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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): March 15, 2000
HEALTHCENTRAL.COM
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(Exact name of registrant as specified in its charter)
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Delaware 000-27567 94-3250851
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State of Incorporation Commission File No. IRS Employer ID Number
HealthCentral.com
6001 Shellmound Street, Suite 800
Emeryville, CA 94608
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Address, including zip code, of registrant's principal executive office
(510) 250-2500
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Registrant's telephone number, including area code
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ITEM 5. OTHER EVENTS
On March 16, 2000, HealthCentral.com (the "Company") announced that it had
entered into an Agreement and Plan of Reorganization and Merger, dated as of
March 15, 2000 (the "Merger Agreement"), by and among Vitamins.com, Inc.
("Vitamins.com"), HCC Acquisition Corp. ("Merger Sub") and the Company. Under
the terms of the Merger Agreement, Merger Sub will merge with and into
Vitamins.com, and Vitamins.com will become a wholly owned subsidiary of the
Company (the "Merger").
Under the terms of the Merger Agreement, the Company will issue
approximately $103,500,000 of common stock in exchange for all of the capital
stock of Vitamins.com. The Merger is subject to various conditions set forth in
the Merger Agreement, including the adoption of the Merger Agreement by the
shareholders of the Company.
A copy of the press release announcing the Merger is attached hereto as
Exhibit 99.1, and incorporated herein by reference in its entirety.
ITEM 7. FINANCIAL STATEMENT AND EXHIBITS
(c) Exhibits.
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EXHIBIT DESCRIPTION
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<S> <C>
99.1 Press Release of HealthCentral.com dated March 16, 2000
announcing the execution of the definitive merger
agreement.
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Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
HealthCentral.com
By: /s/ C. Fred Toney
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Name: C. Fred Toney
Title: Executive Vice President and
Chief Financial Officer
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EXHIBIT 99.1
[HealthCentral Letterhead]
For Immediate Release
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HealthCentral.com to Acquire Vitamins.com
-Company Moves to Forefront of Online Health e-Commerce and Content Category-
Emeryville, Calif. - March 16, 2000 -- HealthCentral.com (Nasdaq: HCEN), a
leading online provider of healthcare e-commerce and content, today announced
that it has signed a definitive agreement to acquire Vitamins.com, a leading e-
commerce provider of vitamins, minerals and supplements.
Vitamins.com had $30.5 million in 1999 proforma net revenues, and, upon
completion of the transaction with HealthCentral.com, will add 200,000 new
Internet customers to the HealthCentral.com e-commerce platform. Vitamins.com
also has a mail order business with an additional 175,000 active customers that
purchased products in 1999. The Vitamins.com annual mail order catalog
circulation totals more than 7 million. Vitamins.com has 4 retail demonstration
stores and 6 other retail stores in the greater Washington, D.C. metropolitan
area. Demonstration stores serve to showcase Vitamins.com's products, and offer
Internet services and consultants to assist in web site registration and product
purchasing. Utilizing a clicks and bricks strategy, the combined companies
intend to better service customers, increase brand awareness, expand customer
reach to include customers that are not yet online, and lower customer
acquisition costs relative to pure play Internet sites.
Under the terms of the proposed transaction, HealthCentral.com will issue
approximately $103.5 million in common stock to acquire Vitamins.com. The
actual number of shares to be issued will be based upon the average closing
price of HealthCentral.com's common stock for the 10 trading days prior to one
day before the closing date. Based on HealthCentral.com's recent trading price
of $7 per share, approximately 14.8 million shares would be issued if this price
per share remained constant, resulting in 36% of the fully diluted shares of the
combined companies. The proposed transaction is subject to the approval of
shareholders of HealthCentral.com and it is expected that the transaction will
close prior to the end of the second quarter of 2000. The transaction is
expected to be accounted for as a pooling of interests.
Commenting on the deal, president and CEO Albert Greene stated, "American
consumers are projected to spend $16.6 billion in 2003 for vitamins, minerals
and supplements due to the rising popularity of alternative medicines and
therapies, and we are now poised to take advantage of this market opportunity.
Combining our product portfolios will provide consumers with an enhanced and
personalized shopping experience and adds an additional "bricks-and-mortar"
legitimacy to our e-pharmacy business. We believe this represents one of the
many steps we are taking to become the most comprehensive consumer-centric super
health portal."
Vitamins.com's product lines will be integrated into HealthCentral.com's online
drugstore, HealthCentralRx.com, increasing current offerings from 23,000 to
31,000 SKUs, 5,000 of which will represent prescription drugs and 26,000 of
which will include health, beauty, wellness, personal care, vitamins, minerals,
supplements and other products.
"We anticipate that the integration of Vitamins.com will add significant
momentum to our growth strategy and result in new revenue generation, new
customer development and retention and more favorable
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customer acquisition costs," stated Fred Toney, executive vice president and
chief financial officer of HealthCentral.com. "This improves our financial
outlook by accelerating our path to profitability."
Robert Haft, president and CEO of Vitamins.com, will continue to serve as
president of the new wholly owned subsidiary. Mr. Haft has extensive experience
in the retailing sector having been Chairman of Phar-Mor, guiding the turnaround
of the company, and founder of Crown Books and other retail chains. In his
career, he has opened more than 600 new retail stores and brings to
HealthCentral.com a team of e-commerce retailing experts. Mr. Haft will be
responsible for directing HealthCentral.com's e-commerce initiative by
leveraging his expertise and vast retail experience to build a strong franchise.
"We, at Vitamins.com, are pleased to become part of the HealthCentral.com
family," stated Mr. Haft. "Due to the synergies in our marketing philosophies,
we believe that together we can enhance the personalized shopping experience
already being offered by HealthCentralRx.com. Combined, we can leverage our
customer base to bring a significant number of on-line and off-line customers to
the HealthCentral.com network."
Upon completion of the acquisition, Robert Haft, President of Vitamins.com, and
C. Sage Givens, Managing General Partner of Acacia Venture Partners, an investor
in Vitamins.com, will be appointed to HealthCentral.com's board of directors.
For additional information, you are invited to listen to the conference call and
i/cast, which will be broadcast over the Internet at
http://www.noonanrusso.com/www/wwwHC/hcen.ihtml. To listen to the live call,
please go to the Web site at least 15 minutes early to register and ensure all
the necessary components are installed. Alternatively, you can dial (800) 553-
0351 to participate on the conference call. The i/cast replay will be available
until April 16, 2000.
HealthCentral.com and Vitamins.com executives are also available for comment.
To coordinate an interview, contact:
Megan Guffey
Noonan/Russo Communications
[email protected]
212-696-4455 ext. 342
About HealthCentral.com
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HealthCentral.com provides online healthcare content and e-commerce to consumers
through the HealthCentral.com network. This network of information services
provides consumers with highly personalized interactive tools, including custom
newsletters, personalized health information pages and personalized risk
assessments. HealthCentral.com's online drug store, HealthCentralRx.com, carries
over 23,000 SKUs of health-related products and has access to 85 PBM contracts.
HealthCentral.com also acts as an application service provider by designing,
hosting and maintaining private label Web sites for hospitals and health plans.
About Vitamins.com
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Vitamins.com, a Web-based marketer founded in 1997, offers vitamins, minerals,
supplements and other products. The company operates the Vitamins.com Web site,
has 10 retail stores (including four demonstration stores) and a direct mail
retail catalog operation with its own order fulfillment center.
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Forward Looking Statements
Except for historical information, the statements in this news release are
forward-looking statements, involving risks and uncertainties that could cause
actual results to differ materially from those in such forward-looking
statements. Potential risks and uncertainties include, but are not limited to,
the Company's limited operating history and need to generate revenues, a failure
to integrate the Vitamins.com acquisition and other acquisitions or manage
growth, the substantial competition in the eHealth market, the Company's
substantial payment obligations, risks inherent in operating an online pharmacy,
possible liability related to content on or accessed through the Company's Web
sites, the need to build a brand name quickly, the effect of substantial and
changing government regulation, possible systems interruptions, and a failure to
attract and retain key employees and risks related to intellectual property.
Further information regarding these and other risks is included in
HealthCentral.com's S-1 registration statement, filed with the SEC.
# # #
For More Information, Contact:
Media: Financial:
Fiona Hughes Fred Toney
Bairey & Bedford Public Relations EVP and Chief Financial Officer
(925) 672-9547 HealthCentral.com
Fax: (925) 672-9388 (510) 250-2603
[email protected] [email protected]
Megan Guffey Belinda Brouder-Hayes
Noonan/Russo Communications Noonan/Russo Communications
212-696-4455 ext. 342 (212) 696-4455 ext. 224
[email protected] [email protected]
