<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
Amendment No. 2
to
Current Report
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 31, 1997
PLATINUM ENTERTAINMENT, INC.
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
0-27852 36-3802328
(Commission File Number) (I.R.S. Employer
Identification No.)
2001 Butterfield Road
Downers Grove, Illinois 60515
(Address of principal executive offices, including zip code)
(630) 769-0033
(Registrant's telephone number, including area code)
<PAGE>
The Registrant, in order to provide the Pro Forma Financial Information
required to be included in the Current Report on Form 8-K dated February 18,
1997, and as amended April 21, 1997, in connection with the acquisition of
certain assets and the assumption of certain liabilities of Intersound, Inc.,
hereby amends the following item:
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
a) Financial Statements.
The financial statements of Intersound, Inc. are herein incorporated
by reference to the Company's Current Report on Form 8-K/A,
Amendment No. 1, dated January 31, 1997 filed with the Commission on
April 21, 1997.
b) Pro Forma Financial Information.
The following Pro Forma Financial Information is included in pages P-1
through P-3 of this Form 8-K/A:
Pro Forma Consolidated Statement of Operations Data for the Year Ended
May 31, 1997 (unaudited)
c) Exhibits.
4.1* Registration Rights Agreement, dated as of January 31, 1997,
between Registrant and Intersound, Inc.
4.2* Convertible Promissory Note, dated January 31, 1997, issued by
the Registrant in the principal amount of $3,125,000.
4.3* Convertible Promissory Note, dated January 31, 1997, issued by
the Registrant in the principal amount of $1,875,000.
4.4* Warrant to Purchase Shares of Common Stock of the Registrant,
dated January 31, 1997.
10.1* Asset Purchase Agreement between River North Studios, Inc. and
Intersound, Inc., dated November 13, 1996. Registrant agrees to
furnish supplementally to the Commission, upon request, a copy of
any omitted schedule.
10.2* First Amendment to Asset Purchase Agreement, dated January 31,
1997, between River North Studios, Inc. and Intersound, Inc.
10.3* Employment Agreement of Don Johnson, dated February 1, 1997.
10.4* Credit Agreement, dated as of January 31, 1997, among the
Registrant, Bank of Montreal and the Banks who are or may become
parties thereto. Registrant agrees to furnish supplementally to
the Commission, upon request, a copy of any omitted schedule.
10.5* Security Agreement, dated as of January 31, 1997, among the
Registrant, its subsidiaries and Bank of Montreal. Registrant
agrees to furnish supplementally to the Commission, upon request,
a copy of any omitted schedule.
10.6* Security Agreement re: Intellectual Property, dated as of
January 31, 1997, among the Registrant, its subsidiaries and Bank
of Montreal. Registrant agrees to furnish supplementally to the
Commission, upon request, a copy of any omitted schedule.
10.7* Pledge Agreement, dated as of January 31, 1997, among the
Registrant and Bank of Montreal.
10.8* Guaranty, dated as of January 31, 1997, among the Registrant and
Bank of Montreal.
10.9* Term Credit Note, dated January 31, 1997, made by Steven Devick.
10.10* Revolving Credit Note, dated January 31, 1997, issued by the
Registrant in the principal amount of $10,000,000.
* Previously filed.
1
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Platinum
Entertainment, Inc. has duly caused this Current Report to be signed on its
behalf by the undersigned, hereunto duly authorized, on this 29th day of
August, 1997.
PLATINUM ENTERTAINMENT, INC.
By: /s/ DOUGLAS C. LAUX
---------------------------------------------
Douglas C. Laux
Chief Financial Officer
(Principal Financial and Accounting Officer)
2
<PAGE>
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL DATA
Set forth below is the Unaudited Pro Forma Consolidated Statement of
Operations Data for the fiscal year ended May 31, 1997. The Unaudited Pro
Forma Consolidated Statement of Operations for the fiscal year ended May 31,
1997 (i) gives pro forma effect to the acquisition of Intersound, Inc.
("Intersound" or the "Acquisition") and (ii) reflects the debt borrowed to
finance the Acquisition, both as if such transaction had occurred on June 1,
1996. The Unaudited Pro Forma Consolidated Balance Sheet at May 31, 1997 is
herein incorporated by reference to the Company's Report on Form 10-K filed
with the Securities and Exchange Commission (the "SEC"), on August 29, 1997 as
the Company's actual consolidated balance sheet at May 31, 1997 reflects the
Acquisition.
The unaudited pro forma consolidated financial data presented herein is
based on the assumptions and adjustments described in the accompanying notes.
The Unaudited Pro Forma Consolidated Statement of Operations does not purport
to represent what the Company's results of operations would have been if the
events described above had occurred as of the date indicated or what such
results will be for any future periods. The unaudited pro forma consolidated
financial data is based upon assumptions and adjustments that the Company
believes are reasonable. The unaudited pro forma consolidated financial data
and the accompanying notes should be read in conjunction with (i) the
historical financial statements of the Company, including the notes thereto,
which are included in its Annual Report on Form 10-K filed with the SEC on
August 29, 1997 and (ii) the historical financial statements of Intersound,
including the notes thereto, which are included in its Form 8-K/A filed with
the SEC on April 21, 1997.
P-1
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UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS DATA
Year Ended May 31, 1997
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
PRO FORMA
HISTORICAL INTERSOUND AS ADJUSTED
PLATINUM INTERSOUND (a) ADJUSTMENTS (b) PLATINUM
-------- -------------- --------------- -----------
<S> <C> <C> <C> <C>
Gross product sales $ 37,502 $ 18,361 $ - $ 55,863
Less: Returns and allowances (8,713) (4,246) - (12,959)
Less: Discounts (2,463) (1,196) - (3,659)
---------- ---------- ---------- ----------
Net product sales 26,326 12,919 - 39,245
Cost of product sales 14,038 5,019 - 19,057
---------- ---------- ---------- ----------
12,288 7,900 - 20,188
Gross artist project revenues 3,876 - - 3,876
Less: Allowance for unrecoupable
artist advances (855) - - (855)
---------- ---------- ---------- ----------
Net artist project revenues 3,021 - - 3,021
Licensing, publishing and other revenues 1,255 277 61 1,593
---------- ---------- ---------- ----------
Net artist project and other revenues 4,276 277 61 4,614
Cost of artist project and other revenues 3,752 111 41 3,904
---------- ---------- ---------- ----------
524 166 20 710
Gross profit 12,812 8,066 20 20,898
Other operating expenses:
Selling, general and administrative expenses 13,141 5,388 2 18,531
Merger, restructuring and one-time costs 3,336 - - 3,336
Depreciation and amortization 973 371 646 (c) 1,990
---------- ---------- ---------- ----------
17,450 5,759 648 23,857
---------- ---------- ---------- ----------
Operating income (loss) (4,638) 2,307 (628) (2,959)
Interest income 154 - - 154
Interest expense (1,385) (194) (1,989) (d) (3,568)
Financing costs (3,533) - - (3,533)
Equity gain 48 - - 48
---------- ---------- ---------- ----------
Income (loss) before income taxes (9,354) 2,113 (2,617) (9,858)
Provision for income taxes - - - -
---------- ---------- ---------- ----------
Net income (loss) $ (9,354) $ 2,113 $ (2,617) $ (9,858)
========== ========== ========== ==========
Net loss per common share $ (1.82) $ (1.92)
Weighted average number of common
shares outstanding 5,136,830 5,136,830
</TABLE>
P-2
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(a) The historical statement of operations data for Intersound represents the
unaudited results of operations from June 1, 1996 to December 31, 1996.
The operations of Intersound for the months of January through May 1997 are
reflected in the Platinum amounts. The Acquisition has been accounted for
as a purchase totaling $41,000,000 which exceeds the fair value of the
assets acquired by $6,098,000, which represents goodwill. See financial
statements and notes thereto of Intersound, Inc. incorporated herein by
reference.
(b) The pro forma adjustments include the unaudited activities of Red Rewmar
Music, Inc., Rappel Music, Inc. and Spec Twelve Music, Inc. for the
six month period ended December 31, 1996 that were acquired simultaneously
with the Acquisition and not reflected in the historical Intersound
amounts. Such adjustments increased licensing, publishing and other
revenues, cost of artist project and other revenues, and selling, general
and administrative expenses by $61,000, $41,000 and $2,000, respectively.
(c) The adjustment to depreciation and amortization consists of an increase in
amortization of music catalog, music publishing rights and goodwill
acquired from Intersound, Inc. over a 25-year period, as if such purchase
had occurred on June 1, 1996.
(d) The adjustment to interest expense reflects additional interest expense
that would have been incurred had the consideration in the form of debt
related to the Acquisition been incurred on June 1, 1996 ($2,183,000).
The interest expense related to additional debt incurred by the Company in
connection with the Acquisition is based on bank borrowings of $28,856,000
with an average interest rate of 12.00% per annum and convertible
debentures of $5,000,000 with an interest rate of 8.00%. In addition, the
historical interest expense incurred by Intersound ($194,000) has been
eliminated as the related debt was paid in full upon the closing of the
Acquisition.
P-3
