GENESIS DIRECT INC
8-K, 1999-09-03
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<PAGE>

                                 UNITED STATES
                      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



                                August 19, 1999
- --------------------------------------------------------------------------------
                Date of Report (Date of earliest event reported)



                              GENESIS DIRECT, INC.
- --------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


     Delaware                            0-24173               22-3449666
- --------------------------------------------------------------------------------
  (State or other jurisdiction         (Commission           (IRS Employer
      of incorporation)                File Number)        Identification No.)


    100 Plaza Drive, Secaucus, New Jersey                              07094
- --------------------------------------------------------------------------------
   (Address of principal executive offices)                         (Zip Code)



Registrant's telephone number, including area code        (201) 867-2800
                                                          --------------
<PAGE>

                    INFORMATION TO BE INCLUDED IN THE REPORT



Item 3.   Bankruptcy or Receivership.
- -------   --------------------------

          On August 19, 1999, Genesis Direct, Inc. and substantially all of its
subsidiaries (collectively, the "Debtors") filed petitions for reorganization
under Chapter 11 of the United States Bankruptcy Code, 11 U.S.C. Sections 101 et
seq. The petitions were filed in the United States Bankruptcy Court in Newark,
New Jersey. The petition for Genesis Direct, Inc. was assigned Case No. 99-
39299 (NLW), and was assigned to Judge Novalyn L. Winfield. The Debtors are
continuing to operate their business and their assets as debtors-in-possession.
No trustee has been appointed.

          Registrant's press release dated August 19, 1999 is filed herewith as
Exhibit 20 and is incorporated herein by reference.


Item 4.   Changes in Registrant's Certifying Accountant.
- ------    ---------------------------------------------

  a. Prior to the bankruptcy filing, Ernst & Young LLP ("Ernst & Young") served
as the Registrant's independent accountants. On August 31, 1999, the Registrant
determined not to proceed with Ernst & Young's continued service as its
accountants during bankruptcy because the Registrant and Ernst & Young have been
unable to agree on the compensation terms of such an engagement, including the
payment of pre-petition amounts due to Ernst & Young.

  b. Ernst & Young's report on Registrant's financial statements for the fiscal
year ended March 27, 1999 was qualified by the following paragraph:

     The accompanying financial statements have been prepared assuming Genesis
     Direct, Inc. will continue as a going concern.  As more fully described in
     Note 2, the Company has incurred operating losses since inception, has an
     accumulated deficit of $248.2 million at March 27, 1999, and has working
     capital of $8.3 million, inclusive of $49.6 million representing the
     estimated net realizable value of net assets available for sale.  These
     conditions raise substantial doubt about the Company's ability to continue
     as a going concern.  The financial statements do not include any
     adjustments to reflect the possible future effects on the recoverability
     and classification of assets or the amounts and classification of
     liabilities that may result from the outcome of this uncertainty.

  c. The Registrant has not had any disagreements with Ernst & Young, and there
have not been any reportable events, in each case which would require disclosure
under Item 304 of Regulation S-K.

  d. The Registrant has requested that Ernst &Young furnish it with a letter
addressed to the Securities and Exchange Commission stating whether it agrees
with the above statements, which letter is filed herewith as Exhibit 16.

  e. On August 31, 1999, the Board of Directors of the Registrant approved
engaging Arthur Anderson LLP ("Arthur Anderson") as accountants and financial
advisors to assist the Registrant in its reorganization. The Registrant has not
consulted with Arthur Anderson on any matter which would require disclosure
under Item 304 of Regulation S-K.
<PAGE>

Item 7.   Financial Statements and Exhibits.
- ------    ---------------------------------

          (c)  Exhibits.
               ----------

               16.  Letter from Ernst & Young to the Securities and Exchange
                    Commission regarding the change in Registrant's certifying
                    accountant.

               20.  Press release of Registrant dated August 19, 1999.
<PAGE>

                                   SIGNATURE
                                   ---------


          Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, the Registrant has duly caused this Current Report to be signed on
its behalf by the undersigned thereunto duly authorized.


                                             GENESIS DIRECT, INC.
                                             --------------------
                                                 (Registrant)


                                             By  /s/ Harry Usher
                                               -----------------------
                                               Chief Executive Officer



Date:  September 3, 1999
<PAGE>

                                 EXHIBIT INDEX



                                                                  Sequentially
Exhibit                                                           Numbered Page
- -------                                                           -------------


 16.      Letter from Ernst & Young to the Securities and
          Exchange Commission regarding the change in
          Registrant's certifying accountant.

 20.      Press release of Registrant dated
          August 19, 1999.

<PAGE>

                                                                      Exhibit 16
                                                                      ----------

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Gentlemen:

We have read Item 4 of Form 8-K dated September 3, 1999 of Genesis Direct, Inc.,
and are in agreement with the statements contained in paragraphs a, b, and c
therein.  We have no basis to agree or disagree with other statements contained
therein.

                                        /s/ Ernst & Young LLP

September 3, 1999

<PAGE>

                                                                      Exhibit 20
                                                                      ----------


                                    For:      Genesis Direct, Inc.
                                              (d.b.a. PROTEAM.com)

                                    Contact:  Fred Larcombe
                                              (201) 867-2800

     For Immediate Release
     ---------------------



               PROTEAM.COM ANNOUNCES VOLUNTARY CHAPTER 11 FILING

   - Restructuring Will Assist Company in Maintaining Its Leadership Position
                        In the Fan-Based Sports Market -


     Secaucus, New Jersey, August 19, 1999 - Genesis Direct, Inc., doing
business as PROTEAM.com, (Nasdaq:PRTM) stated today that it has filed a
voluntary petition to reorganize under Chapter 11 of the United States
Bankruptcy Code. Under Chapter 11, PROTEAM.com will continue to operate its
business under court protection from creditors while it formulates a
reorganization plan. The petition was filed in the U.S. Bankruptcy Court of
Newark, New Jersey. The Company determined that seeking Chapter 11 protection
was appropriate in order to continue the operation of its core business.

     PROTEAM.com has obtained debtor-in-possession (DIP) financing to fund its
ongoing operations.

     Harry Usher, recently appointed by the Board as Chief Executive Officer of
PROTEAM, stated, "While the decision to file for Chapter 11 was difficult to
make, it clearly represented the most viable option as we pursue a restructuring
plan for our Company. Our core sports business is strong, and PROTEAM continues
to be the leader in innovative thinking as proven by its groundbreaking ability
to combine television, print, radio and Internet marketing and sales strategies.
Due to these factors, we expect to emerge from this process the continued
leading e-tailer in the fan-based sports market."

PROTEAM.com is a leading e-tailer specializing in the marketing and sales of
sports and sports related products to both fans and participants. The Company
offers products directly to consumers through several targeted websites and
complementary catalogs, television and radio advertising and other electronic
broadcast and print media.
<PAGE>

This press release contains forward-looking statements within the meaning of the
applicable federal securities laws. Such forward-looking statements include,
among other things, the Company's plans to implement its growth strategies,
increase it Internet website presence, increase its access to Internet users,
dispose of its non-sports assets, improve its financial performance, reduce its
fixed cost structure and improve its fulfillment capabilities. Such forward-
looking statements also include the Company's expectations concerning factors
affecting the markets for its products, such as consumer demand, general market
conditions and Internet access. Actual results could differ from those projected
in any forward-looking statements. Factors that could cause actual results to
differ from those anticipated are detailed in PROTEAM.com's filings with the
Securities and Exchange Commission. The forward-looking statements are made as
of June 28, 1999 and the Company assumes no obligation to update the forward-
looking statements or to update the reasons why actual results could differ from
those projected in the forward-looking statements. Investors should consult all
of the information set forth herein and the other information set forth from
time to time in the Company's reports filed with the Securities and Exchange
Commission pursuant to the Securities Act of 1933 and the Securities Exchange
Act of 1934.


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