U. S. Securities and Exchange Commission
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Date of Report ( Date of earliest event reported) September 29, 1999
0-23545
Commission File Number
JRECK Subs Group, Inc.
(Exact name of small business issuer as specified in its charter)
Colorado 84-1317674
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
2101 West State Road 434, Suite 100,
Longwood, Florida, 32779 (407) 682-6363
(Address of principal executive offices) (Issuer's telephone number
including area code)
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On September 29, 1999 the former owners of Little king, Inc. (a wholly owned
subsidiary) repurchased that company from JRECK Subs Group, Inc. for a return of
800,000 shares of the Company's common stock. The agreement was concluded as
part of the original acquisition agreement which allowed for the repurchase of
Little King. Inc. if the Company's common stock was not at least $1.50 per share
on the second anniversary date of the acquisition (August 31, 1999). A summary
balance sheet and statement or operations as of June 30, 1999 ad a pro-forma
balance sheet and statement of operations after the repurchase is as follows:
<TABLE>
<CAPTION>
JRECK Subs Group, Inc. JRECK Subs Group. Inc.
Consolidated Little King, Inc. Proforma
Balance Sheet Balance Sheet Consolidated Balance Sheet
June 30, 1999 June 30, 1999 June 30, 1999
------------ ------------ ------------
<S> <C> <C> <C>
Current Assets $ 1,753,184 $ 97,124 $ 1,628,184
Property & Equipment (net) 791,508 0 791,508
Excess Cost over Fair Value 10,826,582 1,719,069 9,107,513
Other Assets 820,506 191,454 656,928
------------ ------------ ------------
Total Assets $ 14,191,780 $ 2,007,647 $ 12,184,133
============ ============ ============
Current Liabilities $ 4,132,496 $ 658,880 $ 3,473,616
Long Term Debt 985,952 287,437 698,515
------------ ------------ ------------
Total Liabilities 5,118,448 946,317 4,172,131
Redeemable Stock 3,519,288 0 3,519,288
Shareholders' Equity 5,554,044 1,061,330 4,492,714
Total Liabilities & Shareholders'
Equity $ 14,191,780 $ 2,007,647 $ 12,184,133
============ ============ ============
<CAPTION>
Little King, Inc. JRECK Subs Group, Inc.
JRECK Subs Group. Inc. Income Stmt. Proforma
Consolidated Income Stmt. Six Months Income Stmt.
Six Months Ended Ended Six Months Ended
June 30, 1999 June 30,1999 June 30, 1999
------------ ------------ ------------
<S> <C> <C> <C>
Revenues $ 2,149,004 $ 133,892 $ 2,015,112
Costs & Expenses:
Cost of Retail Sales 348,287 101,709 246,578
General & Administrative 1,615,589 0 1,615,589
Consulting & Investor Relations 412,486 0 412,486
Interest 262,713 18,522 244,191
Amortization & Depreciation 426,471 61,644 364,827
------------ ------------ ------------
Total Costs & Expenses 3,065,546 181,875 2,883,671
Other 125,471 0 125,471
Net Income Attributable to Common
Shareholders' $ (1,042,013) $ (47,983) $ (994,030)
============ ============ ============
Basic Earnings Per Share $ (0.05) $ (0.05)
</TABLE>
<PAGE>
Item 7. Exhibits.
Exhibit No. Description
10.1 Repurchase Agreement between Sidney Wertheim and JRECK
Subs, Group, Inc. for the repurchase of Little King, Inc.
dated September 29, 1999.
SIGNATURES
In accordance with all the requirements of the Exchange Act, the registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Jreck Subs Group, Inc.
- -----------------------------
(Registrant)
President &
10/08/99 Christopher M. Swartz Duly Authorized Officer Christopher M. Swartz
- -------- --------------------- ----------------------- ---------------------
Date Print Name Title Signature
Chief Financial Officer
10/08/99 Michael F. Cronin Principal Accounting Officer Michael F. Cronin
- -------- ----------------- ---------------------------- -----------------
Date Print Name Title Signature
REPURCHASE AGREEMENT
The following Agreement is the understanding between the parties relating to a
Repurchase Agreement to be EFFECTIVE on August 31, 1999 and FINALIZED on
September 28th, 1999 by and between SRW, Inc., Little King, Inc. (Repurchaser)
and Jreck Subs Group, Inc. (the Company). The parties hereto desire to define
their respective rights, duties and obligations in connection with the Option to
Repurchase Stock and conclude their business relationship as follows:
1. Jreck Subs Group, Inc. agrees to transfer back all corporate documents and
Trademarks of Little King, Inc. and any and all personal property, including all
tangible and intangible assets held by the Company on the effective date of this
Agreement.
2. Parties hereto agree to mutually release, discharge and waive all claims
known or unknown regarding one another. Under this Mutual Indemnification, the
parties agree to hold each other, and their principals, employees, directors,
agents and representatives, harmless from all suits, proceedings, claims,
demands, judgments or appeals thereof, past present and future; specifically,
but not limited to, any litigation or judgment against Little King, Inc., SRW,
Inc., Sidney B. Wertheim, personally, and Robert Wertheim and Jreck Subs Group,
Inc.
3. Repurchase Price shall be all shares that are presently held by Sidney B.
Wertheim or his designees, except the 1,000 shares issued to Don Pistillo.
4. It is understood that Jreck Subs Group, Inc. will cancel all shares that have
ever been issued to Sidney B. Wartheim or his designees, exclusive of the 1,000
shares issued to Don Pistillo.
5. The Consideration for this Agreement will be the cancellation of all
outstanding shares issued under the original Agreement and Addendums, except as
hereinabove stated.
6. It is understood that this Agreement is being mutually agreed upon and is
mutually desired and was referred to in the Original Agreement (see 7.10 of
Original Agreement).
7. It is further agreed that any disputes arising under or in connection with
the Interpretation of this Agreement or the rights and obligations of the
parties hereto shall be resolved by arbitration under the rules of the American
Arbitration Association, at a site to be mutually agreed upon by the parties.
The decision of the arbitrator(s) shall be final and binding, and judgment may
be entered thereon in the appropriate court having jurisdiction in the State of
Florida, County of Orange.
JRECK SUBS GROUP, INC. LITTLE KING, INC.
By: /s/ Christopher M. Swartz By: /s/ Sidney B. Wertheim 9-29-99
--------------------------- ------------------------
Christopher M. Swartz Sidney B. Wertheim, President
President & CEO
/s/ Sidney B. Wertheim 9-29-99
------------------------------
Sidney B. Wertheim, Personally
/s/ Robert Wertheim 9-29-99
------------------------------
Robert Wertheim, Personally
