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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): JULY 22, 1999
K2 INC.
(exact name of registrant as specified in its charter)
DELAWARE 1-4290 95-2077125
(State of Incorporation) (Commission File No. (I.R.S. Employer
Identification No.)
4900 SOUTH EASTERN AVENUE, LOS ANGELES, CA 90040
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (323) 724-2800
N/A
(Former name or former address, if change since last report)
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Item 5. Other Events.
On July 22, 1999, K2 Inc. (the "Registrant"), announced that it had
entered into an Agreement and Plan of Merger (the "Merger Agreement"), dated
July 22, 1999, among the Registrant, Ride Inc. and KT Acquisition, Inc.,
pursuant to which Ride, Inc. agreed to merge with a wholly owned subsidiary
of the Registrant subject to the terms and conditions described in the
agreement.
A copy of the Registrant's press release announcing the execution of
the Merger Agreement, dated July 22, 1999, is filed as an exhibit to this
Current Report on Form 8-K.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) EXHIBITS.
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EXHIBIT NO. DESCRIPTION
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99.1 Press Release, dated July 22, 1999, announcing the execution
of the Merger Agreement.
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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.
Date: July 30, 1999 K2 INC.
By: /S/RICHARD M. RODSTEIN
-------------------------------------
Richard M. Rodstein
President and Chief Executive Officer
K2 INC.
Dated: July 30, 1999
By: /S/JOHN R. RANGEL
-------------------------------------
John R. Rangel
Senior Vice President - Finance
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July 22, 1999
K2 Inc. (NYSE:KTO) announces
acquisition of Ride, Inc. (OTC:RIDE)
Los Angeles, California -July 22, 1999 - K2 Inc. (NYSE:KTO)
today announced that it has signed a definitive agreement to acquire Ride
Inc. (OTC:RIDE), a Preston Washington-based designer and manufacturer of
snowboard equipment, apparel and accessories under the Ride, Liquid, 5150,
Smiley and FullTilt brand names. The all stock transaction is expected to be
accretive to K2 earnings during 2000, if integration can be accomplished as
planned.
"This acquisition will enable us to create one of the
strongest snowboard organizations in the world," said Richard M. Rodstein, K2
president and chief executive officer. "This is an exciting acquisition of
one of the early innovators in the snowboard business. Ride's demonstrated
ability to design innovative and high quality snowboards, strap and step-in
bindings and snowboard boots and apparel has resulted in upward momentum for
its brands in the marketplace. While it is our intention to maintain the
distinctiveness of the Ride brand, we see exciting opportunities to combine
the talents of our companies that will enable us to deliver higher quality
products, introduce new products, and raise service levels to our valued
customer base. The acquisition creates an opportunity to benefit from a
synergistic combination and to leverage each company's strengths in different
markets to grow our global presence."
"There are many compelling reasons for the company to join
forces with K2," added Robert Marcovitch, president and chief executive
officer of Ride Inc. "The strong market position of Ride and its family of
brands combined with K2's reputation for innovation and financial strength
will help solidify the combined company's position in the growing snowboard
category. Furthermore, the synergies afforded by the combination will enhance
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Ride's ability to continue to develop and manufacture the technically
innovative, superior quality products our customers around the world have
come to expect."
Under the terms of the agreement, K2 will acquire all
outstanding shares of common stock of Ride Inc., in exchange for shares of K2
Inc. common stock. The shareholders of Ride Inc. will receive a fraction of a
K2 share with an approximate value of $1.00 for each share of Ride stock
owned. The exact exchange ratio will be determined by dividing $1.00 by the
market price of K2 stock during a five-day period prior to the merger, but
not less than $10 nor more than $12. Based on the current number of Ride Inc.
common shares outstanding, the value of the transaction is approximately
$14.3 million. In the aggregate, K2 will issue approximately 1.4 million
shares at closing and will reserve approximately 324,000 additional shares
for possible future issuance on exercise of options and warrants.
The merger transaction is expected to close within 100 days
and will be accounted for as a purchase. The boards of directors of both
companies have approved the agreement. The transaction is subject to the
approval of Ride Inc. shareholders and satisfaction of regulatory
requirements and other customary terms and conditions K2 Inc. is a leading
designer, manufacturer and marketer of brand name sporting goods, other
recreational and industrial products. The Company's sporting goods products
include well-known names such as K2 and OLIN alpine skis, K2 SNOWBOARDS,
BOOTS AND BINDINGS, K2 in-line skates, STEARNS sports equipment, SHAKESPEARE
fishing tackle, K2 bikes, AND DANA DESIGN backpacks. K2's other recreational
products include Planet Earth skate boards, Adio skateboard shoes and HILTON
active apparel. K2's industrial products include SHAKESPEARE extruded
monofilaments, marine antennas and fiberglass light poles.
This News Release contains forward-looking statements based
on K2's current expectations, estimates and projections about the snowboard
industry, management's beliefs, and certain assumptions made by us. Words
such as "should," "expects," "believes," "may," "will," and similar
expressions are intended to identify forward-looking statements. These
statements are not guarantees of future performance and are subject to
certain risks, uncertainties and assumptions that are difficult to predict.
Therefore, our actual results could
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differ materially and adversely from those expressed in any forward-looking
statements as a result of various factors. Important factors that may cause
such a difference for K2 in connection with the acquisition of Ride include
but are not limited to, the risks inherent in acquisitions in the sporting
goods market, including the timing and successful completion of product
development through production readiness, integration issues, unanticipated
expenditures, changing relationships with customers and suppliers, potential
contractual, intellectual property or employment issues, and the risk that
the acquisition cannot be completed successfully or that anticipated benefits
are not realized; risks and uncertainties associated with the weather; the
timing, rescheduling or cancellation of significant customer orders; the loss
of a significant customer; the availability and pricing of competing products
and the resulting effects on sales and pricing of our products; intellectual
property disputes; risks and uncertainties associated with international
operations; our ability to retain and hire key executives, and other
employees in the numbers, with the capabilities, and at the compensation
levels needed to implement our business and product plans; the quality of our
products; business disruptions, claims, expenses and other difficulties
resulting from "Year 2000" problems in computer-based systems used by us, our
suppliers or our customers; general economic conditions and specific
conditions in the markets we address; and other factors.
K2's recent Annual Report on Form 10-K and Quarterly Report
on Form 10-Q and other Securities and Exchange Commission filings discuss
some of the important risk factors that may affect our business, results of
operations and financial condition.
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