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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): November 1, 1999
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SVI Holdings, Inc.
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(Exact Name of Registrant as Specified in its Charter)
Nevada
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(State or Other Jurisdiction of Incorporation)
0-23049 84-1131608
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(Commission File Number) IRS Employer Identification No.)
12707 High Bluff Drive, Suite 335, San Diego, California 92130
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(Address of Principal Executive Offices) (Zip Code)
(858) 481-4405
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(Registrant's telephone number, including area code)
7979 Ivanhoe Avenue, Suite 500, La Jolla, California 92037
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS
See attached press release and Amendment to Note.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
Exhibit
Number Description
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2.1 Amendment to Note
99.1 Press release
SIGNATURE
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 hereto duly authorized.
Date: November 1, 1999
SVI Holdings, Inc.
(Registrant)
By: /s/ David L. Reese
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David L. Reese, Chief Financial Officer
EXHIBIT 2.1
AMENDMENT TO NOTE
This Amendment to Note is made October 1, 1999 between KIELDUFF
INVESTMENTS LIMITED ("Maker") and SVI HOLDINGS, INC. ("Holder").
BACKGROUND
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Maker executed a Note dated December 31, 1998 ("Note") pursuant to which Maker
borrowed the sum of $18,108,000, which sum is secured by a Pledge Agreement
dated December 31, 1998. The balance of accrued interest due under the Note
through September 30, 1999 will be $355,571.51. Maker has requested an extension
of the due date of the Note from October 1, 1999 to February 15, 2000. As a
condition to Holder granting an extension of the due date of the Note, Maker
agrees to pay to Holder the $355,571.51 of accrued interest due under the Note
through September 30, 1999.
Maker and Holder now agree as follows:
1. CONDITIONS PRECEDENT. Holder has no obligation under this Amendment
and the terms of the Note remain in full force and effect, unmodified by the
terms of this Amendment, unless prior to October 29, 1999, Maker shall have
delivered to Holder immediately available funds in the amount of $355,571.51 to
be applied towards accrued interest due under the Note through September 30,
1999.
2. PAYMENT EXTENSION. Paragraph 1 of the Note is hereby deleted, and
the following provision substituted in its place:
"Payments. All amounts of principal and interest due under this Note
shall be paid to Holder on or before February 15, 2000."
3. CONFIRMATION OF NOTE. All other terms and provisions of the Note not
amended remain in full force and effect.
4. NO WAIVER. Except as specifically provided in this Amendment, Holder
has no obligation, nor has Holder made any commitment or representation, to
waive any further or additional defaults or to provide any additional extension
of the due date.
5. NO NOVATION. This Amendment does not constitute a novation or a
renewal of the Note, but rather a modification of the Note.
6. GENERAL. This Amendment is governed by and construed under the laws
of the State of California. This Amendment represents the entire agreement
between the parties and neither party shall be bound by any prior discussions,
proposals or oral agreements.
7. COUNTERPARTS. This Amendment may be executed in counterparts, each
of which shall be deemed an original and all of which together shall constitute
one document.
KIELDUFF INVESTMENTS LIMITED, SVI HOLDINGS, INC.,
an Ireland company a Nevada corporation
By: /s/ Peter Nagle By: /s/ Barry M. Schechter
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Name: Peter Nagle Name: Barry M. Schechter
Title: Director Title: Chief Executive Officer
ACKNOWLEDGED AND CONSENTED TO BY:
SYSTEMS FOR BUSINESS INCORPORATED,
a British Virgin Islands corporation
By: Peter Nagle
Name: Peter Nagle
Title: Officer
EXHIBIT 99.1
Monday, November 1, 1999
Press Release
SVI Holdings Announces Extension of Note Receivable
SAN DIEGO--(BUSINESS WIRE)--Nov. 1, 1999--SVI Holdings Inc. (AMEX:SVI - news)
announced today that it agreed to extend the maturity on a secured promissory
note payable to SVI by Kielduff Investments Limited ("Kielduff"), the purchaser
of all of the outstanding shares in IBIS Systems Limited ("IBIS").
The original sale price was $18.1 million and the current balance of the
purchase price payable to SVI is $13.6 million. The note originally matured on
Oct. 1, 1999, and has been extended to Feb. 15, 2000. Interest on the debt is
current and the note remains secured by a pledge of 100% of the common stock of
IBIS. Kielduff is a company affiliated with Peter Nagle, who was managing
director of IBIS during the period the company owned IBIS.
Barry Schechter, chairman of the board and chief executive officer of SVI,
stated: "Kielduff requested an extension of the maturity date on the note as it
had not completed a planned reorganization to provide the funds necessary to
retire the note. After obtaining assurances from Kielduff that its
reorganization is likely to occur before February 2000, the company granted
Kielduff the additional period to complete the reorganization."
Schechter added, "IBIS was sold by SVI so the company's resources and management
team could be better utilized developing and expanding its market share in the
retail software systems market." IBIS supplies accounting and business software
applications primarily to United Kingdom customers in the construction and plant
hire industries.
Since the sale of IBIS, SVI acquired Island Pacific Systems Corp. ("Island
Pacific"), a leading software provider of back office merchandising and
e-commerce applications. Together with its existing point-of-sale technology,
SVI has now emerged as a world leader in providing end-to-end systems and
e-commerce services and solutions to retailers worldwide.
In connection with the acquisition of Island Pacific, the company obtained two
bank loans in the total amount of $18.5 million. The company had intended to
retire one of the bank loans in the sum of $15 million from the proceeds of the
Kielduff note. The bank loan requires interest only payments until December
1999.
Schechter explained, "Our agreement with the bank allows for the $15 million
loan to convert to a two-year fully amortizing term loan in December 1999." The
company believes it will have, or can generate, sufficient cash resources to
meet the principal and interest payments on the converted bank loan until the
extended maturity date on the Kielduff note. The company will, however, actively
pursue other alternatives for prepayment of the bank loan regardless of the
Kielduff payment status. While the company is confident in receiving the
required payment from Kielduff, it is taking a prudent and direct posture in
recognizing that this delayed payment could negatively impact the operational
cash flow of the group.
SVI is focused on becoming a leading global provider of enterprise software
solutions for the retail industry, including point-of-sale, retail marketing,
merchandising, training and financial systems. The company maintains offices and
subsidiaries in the United States, the United Kingdom, Australia and South
Africa.
SVI has a worldwide base of more than 100,000 terminals among such Tier 1
clients as the U.S. Postal Service, Home Depot, OfficeMax, The Limited, J.C.
Penney, the Disney Stores, Victoria's Secret and many others.
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Certain statements contained in this news release regarding matters that are not
historical facts may be forward-looking statements, including statements
concerning the ability of Kielduff to pay the $13.6 million note balance by Feb.
15, 2000, and the effect of the extension of that note on SVI and its financial
position and results of operations. Because such forward-looking statements
include risks and uncertainties, actual results may differ materially from those
expressed in or implied by such forward-looking statements. Factors that could
cause actual results to differ materially include, but are not limited to: the
successful completion of Kielduff's reorganization; other factors affecting
Kielduff's business and its financial condition; the continuation of SVI's cash
flow at projected levels, which in turn depends upon competition, fluctuations
in currency exchange rates, and the demand for the company's products and
services domestically and internationally, especially in the United Kingdom,
Australia and South Africa; the availability of additional financing when and if
needed on terms acceptable to the company and other risk factors identified from
time to time in the company's filings with the Securities and Exchange
Commission. Other risk factors are listed in the company's Form 10-KSB for the
year ended March 31, 1999. SVI undertakes no obligation to release publicly any
revisions to the forward-looking statements to reflect events or circumstances
after the date of this news release or to reflect the occurrence of
unanticipated events.
Contact:
SVI Holdings Inc., 858/481-4404
Barry Schechter, [email protected]
David Reese, [email protected]
or
Pondel/Wilkinson Group, 310/207-9300
Roger Pondel/Michael Pollock/E.E. Wang
[email protected]
