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
Date of Report (Date of earliest event reported): October 30, 1998
RIVERSIDE GROUP, INC.
(Exact name of registrant as specified in its charter)
Florida 0-9209 59-1144172
(State of other (Commission File No.) (IRS Employer
jurisdiction of Identification
incorporation) number)
7800 Belfort Parkway, Jacksonville, Florida 32256
(Address of principal executive offices) (Zip Code)
904-281-2200
(Registrant's telephone number, including area code)
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Item 5. Other Events
As a result of a reduction in the registrant's ownership of Wickes Inc.,
to a level below 50%, effective with the registrant's financial statements
for the period ended September 30, 1998, the registrant will account for
its investment in Wickes Inc., on the equity method. From July 1996
through the period ended June 30, 1998, the financial statements of
the registrant included those of Wickes Inc. on a consolidated basis.
In accordance with a NASDAQ requirement, the registrant is including
in this report a Pro Forma Unaudited Condensed Consolidated Balance Sheet
of the registrant at September 30, 1998. This Pro Forma Unaudited
Condensed Consolidated Balance Sheet presents the historical
financial position of the registrant at September 30, 1998 and the
pro forma effects of the previously reported sale of 250,000 shares of Wickes
Inc. common stock on October 5, 1998 pursuant to the Stock Purchase Agreement
dated that date between the registrant and Imagine Investments, Inc. (the
"Imagine Agreement") and the future sale by the Company of an additional
200,000 shares of Wickes Inc. common stock pursuant to the registrant's put
option contained in the Imagine Agreement as if such transations had been
completed on September 30, 1998.
THE INFORMATION CONTAINED IN THE PROFORMA UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEET IS PRESENTED FOR INFORMATIONAL
PURPOSES ONLY AND SHOULD NOT BE RELIED UPON EXCEPT IN CONJUNCTION
WITH THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF
THE REGISTRANT AND NOTES THERETO AND "MANAGEMENT'S OPERATION" THAT
WILL BE CONTAINED IN THE REGISTRANT'S QUARTERLY DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF REPORT FOR THE
PERIOD ENDED SEPTEMBER 30, 1998, WHICH WILL BE FILED BY THE
REGISTRANT WITH THE SECURITIES AND EXCHANGE COMMISSION ON OR BEFORE
NOVEMBER 13, 1998.
IN ADDITION, THE INFORMATION CONTAINED IN THE PRO FORMA
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET SHOULD NOT BE
CONSTRUED TO BE INDICATIVE OF THE REGISTRANT'S CONSOLIDATED
FINANCIAL POSITION HAD THE ABOVE-DESCRIBED SALE OF WICKES INC.
COMMON STOCK BEEN CONSUMMATED ON THE DATES ASSUMED.
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Riverside Group, Inc.
Proforma Condensed Consolidated Balance Sheet
(unaudited)
(in thousands)
<TABLE>
<CAPTION>
September 30, Proforma Proforma
1998 Adjustments(2) Adjustments(3) Proforma
---------- -------------- --------------- ----------
ASSETS
<S> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 140 $ $ 350 $ 490
Notes receivable 439 439
Accounts receivable, less
allowance for doubtful
accounts of $414,000 570 570
Prepaid expenses 46 46
________ __________ ___________ __________
Total current assets 1,195 0 350 1,545
Investment in Wickes Inc. 17,928 (1,197) (957) 15,774
Investment in Greenleaf
Technologies, Inc. (1) 2,949 2,949
Investment in real estate 10,943 10,943
Property, plant and equipment, net 311 311
Deferred tax asset, net 3,307 3,307
Other assets (net of accumula-
ted amortization of $739,000) 434 434
________ __________ __________ __________
Total assets 37,067 (1,197) (607) 35,263
======== ========== ========== ==========
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of
long-term debt $ 10,653 $ $ $ 10,653
Accounts payable 1,181 (813) (300) 68
Income tax payable 25 25
Accrued liabilities 1,325 1,325
_________ __________ __________ __________
Total current liabilities 13,184 (813) (300) 12,071
Mortgage debt 12,750 12,750
Liabilities of discontinued
operations 6 6
Other long-term liabilities 96 96
__________ __________ _________ __________
Total liabilities 26,036 (813) (300) 24,923
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Common stockholders' equity:
Common stock, $.10 par value; 529 529
20,000,000 shares authorized;
issued and outstanding,
5,287,123 in 1998
Additional paid in capital 16,783 16,783
Retained earnings (deficit) (6,281) (384) (307) (6,972)
__________ __________ _________ ___________
Total common stockholders' equity 11,031 (384) (307) 10,340
__________ __________ _________ ___________
Total liabilities and common
stockholders'equity $ 37,067 $ (1,197) (607) $ 35,263
=========== =========== ========= ===========
</TABLE>
Notes to
Pro Forma Unaudited
Condensed Consolidated Balance Sheet
(1) As of September 30, 1998, Riverside Group, Inc. (the
"Company") entered into and completed an agreement with Greenleaf
Technologies Corporation ("Greenleaf"), based in Iselin, New Jersey,
whereby the Company has acquired common shares of Greenleaf in
exchange for 100% of the common stock of the Company's wholly owned
subsidiary, GameVerse, Inc. ("GameVerse"). As a result of the
transaction, the Company now owns 14,687,585 shares, or approximately
forty percent of Greenleaf's outstanding common shares. The Company also
received two five year options to acquire additional newly-issued shares of
Greenleaf's common stock (1) 5,733,333 shares at an average exercise price
of $.25 per share; (2) 1,581,249 shares at an exercise price of $.15 per share.
The Company has recorded its investment in Greenleaf at $2.9 million, which
represents the Company's investment in GameVerse as of September 30, 1998.
The Company plans to have an appraisal completed on its investment in
Greenleaf in accordance with FASB 116. The Company believes that it has made
the best estimate at recording its investment. The market value of the
Company's investment in Greenleaf at the time of the transaction was
approximately $6.7 million based on Greenleaf's stock price of $.46 per share
on the over-the-counter Bulletin Board.
(2) Includes the accounting for the sale of 250,000
shares of Wickes, Inc. common stock that were sold on October 5, 1998.
(3) The Company believes that its cash on hand will not be
sufficient to support its operations and overhead and to service its
indebtedness until such time as its Cybermax and Home Building Resource
operations have begun to generate significant positive cash flow. The
Company will need to obtain additional required funds through assets sales
or additional borrowings or other financing. The Company anticipates that
it will obtain these funds through market and private sales of Wickes common
stock. The pro forma adjustments includes the accounting for the exercise of
the put option with respect to 200,000 shares of Wickes, Inc. common stock
under the Imagine Agreement with respect to Wickes, Inc. common stock that the
Company believes it will exercise prior to November 15, 1998. This exercise
would generate approximately $650,000, of which approximately $300,000 would
be used to pay outstanding payables.
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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.
RIVERSIDE GROUP, INC.
Date: October 30, 1998 By:/s/ Catherine J. Gray
________________________
Catherine J. Gray
Senior Vice President
