GAIAM INC
8-K/A, 2000-09-15
BUSINESS SERVICES, NEC
Previous: LANIER WORLDWIDE INC, DEF 14A, 2000-09-15
Next: MANAGERS AMG FUNDS, 485APOS, 2000-09-15



                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 8-K/A


                                 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 30, 2000

                                   GAIAM, INC.
             (Exact Name of Registrant as Specified in its Charter)


       Colorado                     0-27515                     84-1113527
(State or Other Jurisdiction      (Commission                  (IRS Employer
    of Incorporation)             File Number)              Identification No.)


360 Interlocken Blvd., Suite 300
Broomfield, Colorado                                          80021
(Address of Principal Executive Offices)                   (Zip Code)

Registrant's telephone number, including area code:        (303) 222-3600

                                 Not Applicable
          (Former Name or Former Address, if Changed Since Last Report)


Item 2.  Acquisition or Disposition of Assets.

     On  June  30,  2000,  Gaiam,  Inc.  ("Gaiam")  and  WholePeople.com,   Inc.
("Amrion") contributed certain of their Internet properties (the "Contribution")
into Gaiam.com,  Inc.  ("Gaiam.com").  The Contribution was made pursuant to the
terms of a contribution agreement dated as of June 19, 2000 among Gaiam, Amrion,
and certain  related  parties,  as amended (the  "Contribution  Agreement").  In
exchange  for the  contributed  Internet  properties,  Gaiam  received  50.1% of
Gaiam.com's  common stock and Amrion received the remaining 49.9% of Gaiam.com's
common stock.  Gaiam.com,  which will continue its Internet e-commerce business,
will be consolidated by Gaiam with Gaiam's other operations.

     Pursuant  to the  Contribution  Agreement,  Gaiam and Amrion also agreed to
certain  marketing  arrangements.  Jirka Rysavy,  the Chief Executive Officer of
Gaiam,  will serve as Chairman of the Board of Directors and Co-Chief  Executive
Officer and John Mackey,  the Chief  Executive  Officer of Whole Foods  Markets,
Inc., will serve as Co-Chief Executive Officer. This summary of the Contribution
Agreement  is  qualified  in  its  entirety  by  reference  to the  copy  of the
Contribution   Agreementattached  as  Exhibit  10.1  and  incorporated  by  this
reference.

Item 7(a)   Financial Statements

            Not applicable.

     In connection with the Contribution  Agreement,  Amrion contributed certain
of    its    Internet-related    assets,    including    the    Wholepeople.com,
healthsmartvitamins.com and bioenergynutrients.com  websites, plus $3 million in
cash and a $3 million  short-term  note,  in  exchange  for 49.9% of  Gaiam.com.
During June 2000,  Gaiam also sold 6,000 shares of Redeemable  Class A preferred
stock in Gaiam.com, Inc., at a price of $1,000 per share, to Amrion.

Item 7(b)   Pro Forma Financial Information

                                   GAIAM, INC.
              UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME

     The following unaudited pro forma consolidated  statement of income for the
year  ended  December  31,  1999 is  derived  from the  historical  consolidated
statement of operations of Gaiam, adjusted to give effect to the contribution of
the Wholepeople.com, healthsmartvitamins.com and bioenergynutrients.com websites
as part of the merger effected by the Contribution  Agreement  between Gaiam and
Amrion  and  certain  related  parties.  The  unaudited  pro forma  consolidated
statement of income for the twelve  months ended  December 31, 1999 assumes that
the merger occurred as of September 1, 1999, the commencement of Gaiam.com, Inc.
The pro forma  consolidated  statement  of income is provided  for  illustrative
purposes only and is not  necessarily  indicative  of the  operating  results or
financial position that would have been achieved had the merger been consummated
at the dates  indicated,  nor is it necessarily  indicative of future  operating
results.

                                   GAIAM, INC.
              UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME

A.  Year Ended December 31, 1999

                                           Contributed                   Total
                              Gaiam, Inc.    Websites   Adjustments   Pro Forma
                              -----------  -----------  -----------  -----------

Net revenue................ $ 45,724,662  $  200,172  $       --    $ 45,924,834
Cost of goods sold.........   18,175,787      86,793          --      18,262,580
                              -----------  -----------  -----------  -----------
Gross profit...............   27,548,875     113,379          --      27,662,254
Expenses:
  Selling and operating....   22,337,950      83,482          --      22,421,432
  Corporate, general and
   administration...........   3,086,514      40,725          --       3,127,239
                              -----------  -----------  -----------  -----------
    Total expenses..........  25,424,464     124,207          --      25,548,671
                              -----------  -----------  -----------  -----------
Income (loss) from operations  2,124,411     (10,828)         --       2,113,583
Other income (expense):
 Realized gain (loss) on sale
  of securities and
  other, (See Note 6).....      971,159         --           --         971,159
 Interest expense.........     (365,294)        --           --        (365,294)
                              -----------  -----------  -----------  -----------
Other income (expense), net      605,865         --           --         605,865
                              -----------  -----------  -----------  -----------
Income before income taxes
 and minority interest.....    2,730,276     (10,828)         -        2,719,448
Provision for income taxes.    1,062,789         --           --       1,062,789
Minority interest in net
 income (loss) of consolidated
 subsidiary, net of tax ...      (50,858)        --        (52,256)(b) (103,114)
                             -----------  -----------  -----------  -----------
  Net income..............   $ 1,718,345  $  (10,828)  $    52,256  $  1,759,773
                              ===========  ===========  ===========  ===========
Net income per share:
  Basic...................  $      0.20                              $      0.20
  Diluted.................. $      0.19                              $      0.19

Shares used in computing net income
 per share:
  Basic...................    8,785,205                               8,785,205
  Diluted.................    9,119,108                               9,119,108

                             See accompanying notes.

                                   GAIAM, INC.
              UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME

A.   Notes to Unaudited Pro Forma Consolidated Statement of Income

(a)  Represents   the   results   of   operations   of   the    Wholepeople.com,
     healthsmartvitamins.com   and   bioenergynutirients.com   websites.   These
     websites were  contributed  to Gaiam.com as part of the merger  effected by
     the Contribution Agreement between Gaiam, Inc. and Whole Foods Market, Inc.
     (Amrion) and certain other related parties.

(b)  Represents  the adjustment to minority  interest to reflect  Amrion's 49.9%
     ownership interest in the results of Gaiam.com, Inc. for the entire year.


Item 7 (c)  Exhibits.

10.1 Contribution  Agreement  dated  June 19,  2000 by and  among  Gaiam,  Inc.,
     Gaiam.com, Inc.,  WholePeople.com,  Inc., WPcom Colorado, Inc., WP Internet
     Company and  GnewCo,  Inc.  as amended on July 10,  2000  (incorporated  by
     reference to Gaiam's Current Report on Form 8-K filed July 11, 2000).


                                   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.

                                             GAIAM, INC.

                                             By:     /s/ Jirka Rysavy
                                             Name:   Jirka Rysavy
                                             Title:  Chief Executive Officer
Date: September 15, 2000

                                  Exhibit Index

10.1 Contribution  Agreement  dated  June 19,  2000 by and  among  Gaiam,  Inc.,
     Gaiam.com, Inc.,  WholePeople.com,  Inc., WPcom Colorado, Inc., WP Internet
     Company and GnewCo,  Inc.,  as amended on July 10,  2000  (incorporated  by
     reference to Gaiam's Current Report on Form 8-K filed on July 11, 2000).


© 2022 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission