<PAGE>
As filed with the Securities and Exchange Commission on June 28, 1999
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): June 11, 1999
GENESIS DIRECT, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
0-24173 22-3449666
(Commission File Number) (I.R.S. Employer Identification No.)
100 Plaza Drive, Secaucus, NJ 07094
(Address of Principal Executive Offices) (Zip Code)
(201) 867-2800
(Registrant's Telephone Number, Including Area Code)
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<PAGE>
Item 2. Acquisition or Disposition of Assets.
On April 23, 1999, Genesis Direct Memphis Operations, LLC and Genesis
Direct Memphis Services, LLC (each a subsidiary of the Registrant), the
Registrant and Toysrus.com, LLC ("Buyer") entered into a Purchase Agreement
providing for the acquisition by Buyer of certain assets and liabilities of the
Sellers relating to Sellers' distribution center located in Memphis, Tennessee,
for a purchase price of $30,000,000 payable in cash. The acquisition was
consummated on June 11, 1999. In connection with the disposition, the
Registrant and the Buyer entered into a Fulfillment Services Agreement pursuant
to which the Buyer will provide fulfillment services for Registrant's business.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired.
-----------------------------------------
Not applicable.
(b) Pro Forma Financial Information.
-------------------------------
See Exhibit 99.1
(c) Exhibits.
--------
The following exhibits are filed herewith:
Exhibit
-------
No. Description
--- -----------
99.1 Pro Forma Financial Statements
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GENESIS DIRECT, INC.
By: /s/ Ronald Benanto
--------------------------------------------
Ronald Benanto
Vice President and Chief Financial Officer
Date: June 28, 1999
<PAGE>
Exhibit 99.1
Index to Financial Statements
-----------------------------
Page
----
Unaudited Pro Forma Financial Statements F-2
Unaudited Pro Forma Balance Sheet -- December 26, 1998 F-3
Unaudited Pro Forma Statements of Operations -- Year ended March 28, 1998 F-4
Unaudited Pro Forma Condensed Combined Statements of Operations --
Nine months ended December 26, 1998 F-5
Notes to Unaudited Pro Forma Condensed Combined Financial Statements F-6
<PAGE>
Genesis Direct, Inc.
Pro Forma Financial Statements
On April 23, 1999, Genesis Direct, Inc., its subsidiaries Genesis Direct Memphis
Operations, LLC and Genesis Direct Memphis Services, LLC, and Toysrus.com, LLC
("Buyer") entered into a Purchase Agreement providing for the acquisition by
Buyer of certain assets and liabilities of the Sellers relating to Sellers'
distribution center located in Memphis, Tennessee, for a purchase price of
$30,000,000 payable in cash. The acquisition was consummated on June 11, 1999.
The following unaudited pro forma balance sheet as of December 26, 1998 has been
prepared to present the financial position of Genesis Direct, Inc. as though the
disposition had been consummated on December 25, 1998. The following pro forma
statements of operations for the year ended March 28, 1998 and the nine months
ended December 26, 1998 have been prepared to present the operations of Genesis
Direct, Inc. assuming the disposition had been completed on March 30, 1997.
The unaudited pro forma condensed combined financial statements, including the
notes thereto, are qualified in their entirety by reference to, and should be
read in conjunction with, the historical consolidated financial statements of
Genesis Direct, Inc. included in its Annual Report on Form 10-K for the year
ended March 28, 1998 and Quarterly Reports on Form 10-Q for the fiscal quarters
ended June 27, 1998, September 26, 1998 and December 26, 1998. The unaudited pro
forma balance sheet and statements of operations have been included herein for
comparative purposes only and do not purport to be indicative of the results of
operations which actually would have been obtained had the acquisition been
completed on March 30, 1997. In addition, future results may vary significantly
from the results reflected in these pro forma financial statements.
F-2-
<PAGE>
Pro Forma Condensed Combined Balance Sheet
December 26, 1998
(in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Elimination of
--------------
Distribution
------------
Genesis Center
------- ------
Direct, Inc. Operations Pro Forma
------------ ---------- ---------
<S> <C> <C> <C>
Assets
Current assets:
Cash and cash equivalents........................... $ 11,662 $ 29,975 (b) $ 41,637
Accounts receivable, net............................ 17,532 17,532
Merchandise inventory, net.......................... 62,119 62,119
Deferred advertising costs.......................... 12,218 12,218
Other current assets................................ 4,955 4,955
Due from Genesis.................................... - -
Note receivable, current portion.................... 479 479
-------------- ----------- ----------
Total current assets............................... 108,965 29,975 138,940
Intangibles, net..................................... 9,747 9,747
Goodwill, net........................................ 93,844 93,844
Property, equipment and leasehold improvements, net.. 46,323 (25,255) (a) 21,068
Note receivable, less current portion................ 1,020 1,020
Other assets......................................... 988 988
-------------- ----------- ----------
$ 260,887 $ 4,720 $ 265,607
========= ======== =========
Liabilities and stockholders' equity (deficiency)
Current liabilities:
Accounts payable.................................... $ 40,733 40,773
Accrued expenses.................................... 45,772 45,772
Current portion of notes payable and long-term debt. 24,043 24,043
Current portion of obligations under capital leases. 1,996 1,996
Other current liabilities........................... 2,181 1,954 (c) 4,135
-------------- ----------- ----------
Total current liabilities.......................... 114,725 1,954 116,679
Notes payable and long-term debt, less current 18,227 18,227
portion.............................................
Obligations under capital leases, net of current 3,293 3,293
portion.............................................
Other liabilities.................................... 2,296 2,296
Common stockholders' equity (deficiency):
Investment in subsidiary............................ - -
Common Stock........................................ 323 323
Additional paid-in-capital.......................... 278,542 278,542
Accumulated (deficit) earnings...................... (156,519) 2,766 (b) (153,753)
-------------- ----------- ----------
Total common stockholders' equity.................... 122,346 2,766 125,112
Total liabilities and common stockholders' equity.... $ 260,887 $ 4,720 $ 265,607
============== ========== ==========
</TABLE>
F-3-
<PAGE>
Pro Forma Condensed Combined Statement of Operations
Year Ended March 28, 1998
(in thousands, except share and per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Elimination of
--------------
Distribution
------------
Genesis Center
------- ------
Direct, Inc. Operations Pro Forma
------------ ---------- ---------
<S> <C> <C> <C>
Net sales.............................. $ 107,210 - $ 107,210
Cost of goods sold..................... 81,606 $ 2,108 (a) 83,714
-------------- ------------------ -------------
Gross profit........................... 25,604 (2,108) 23,496
Selling, general and administrative
expenses.............................. 97,840 (6,795) (a) 91,045
-------------- ------------------ -------------
Loss from operations................... (72,236) 4,687 (67,549)
Interest expense....................... 4,488 4,488
Interest income........................ 513 513
-------------- ------------------ -------------
Net income (loss)...................... (76,211) 4,687 (71,524)
Dividends accruing on Series A Preferred
Stock................................. (2,439) (2,439)
-------------- ------------------ -------------
Net loss attributable to common
stockholders.......................... $ (78,650) 4,687 $ (73,963)
-------------- ------------------ -------------
Basic net loss per share............... $(8.89) $(8.36)
-------------- ------------------ -------------
Weighted average common shares
outstanding........................... 8,842,200 8,842,200
============== =============
</TABLE>
F-4-
<PAGE>
Pro Forma Condensed Combined Statement of Operations
Nine Months Ended December 26, 1998
(in thousands, except share and per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Elimination of
--------------
Distribution
------------
Genesis Center
------- ------
Direct, Inc. Operations Pro Forma
------------ ---------- ---------
<S> <C> <C> <C>
Net sales.................................... $ 192,773 - $ 192,773
Cost of goods sold........................... 127,792 $ 7,123 (a) 134,915
------------------ ------------------ ------------------------
Gross profit................................. 64,981 (7,123) 57,858
Selling, general and administrative expenses. 121,152 (8,788) (a) 112,364
------------------ ------------------ -------------------------
Loss from operations......................... (56,171) 1,665 (54,506)
Interest expense............................. 3,597 3,597
Interest income.............................. 920 920
------------------ ------------------ ------------------------
Net income (loss) before extraordinary item.. (58,848) 1,665 (57,183)
Extraordinary item - loss on extinguishment
of debt..................................... (5,235) - (5,235)
------------------ ------------------- ------------------------
Net loss..................................... (64,083) 1,665 (62,418)
================== ================== ========================
Basic net loss per share:
Loss before extraordinary item.............. $ (2.13) $ (2.07)
Extraordinary item.......................... (0.19) (0.19)
------------------ ------------------------
Net loss.................................... $ (2.32) $ (2.26)
================== ========================
Weighted average shares - basic.............. 27,630,445 27,630,445
================== ========================
</TABLE>
F-5-
<PAGE>
Genesis Direct, Inc.
Notes to Unaudited Pro Forma Condensed Combined Financial Statements
1. Dispositions
On April 23, 1999, Genesis Direct, Inc. (the "Company"), its
subsidiaries Genesis Direct Memphis Operations, LLC and Genesis Direct Memphis
Services, LLC, and Toysrus.com, LLC ("Buyer") entered into a Purchase Agreement
providing for the acquisition by Buyer of certain assets and liabilities of the
Sellers relating to Sellers' distribution center located in Memphis, Tennessee,
for a purchase price of $30,000,000 payable in cash. The acquisition was
consummated on June 11, 1999. In connection with the disposition, the Company
and the Buyer entered into a fulfillment agreement pursuant to which the Buyer
will provide fulfillment services to the Company. The Company expects to
recognize a gain from this transaction of approximately $2.7 million.
2. Pro Forma Adjustments
Balance Sheet
(a) Elimination of disposed distribution center assets.
(b) Net proceeds and resulting net gain from disposition of
distribution center assets.
(c) Accrual for costs in excess of fair market value related to the
fulfillment agreement.
Statement of Operations
(a) To eliminate actual fulfillment expenses incurred during the
respective periods, and replace such expenses with an estimate of
the fulfillment expenses that would have been incurred had the
Company entered into a fulfillment agreement with a third party
on March 30, 1997 on the same terms as those set forth in its
fulfillment agreement with Buyer.
F-6
