<PAGE> 1
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 6, 2000
DAISYTEK INTERNATIONAL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 0-25400 75-2421746
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification
incorporation) Number)
500 NORTH CENTRAL EXPRESSWAY, PLANO, TX 75074
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (972) 881-4700
NONE
(Former name or former address, if changed since last report)
-1-
<PAGE> 2
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On June 8, 2000, the Board of Directors of Daisytek International
Corporation ("Daisytek" or the "Company") approved the spin-off of PFSweb, Inc.
("PFSweb") to holders of Daisytek's common stock. In order to effect this
spin-off, the Daisytek board declared a dividend on Daisytek common stock
consisting of a total of 14,305,000 shares of PFSweb common stock owned by
Daisytek (the "Distribution"), representing about 80.1% of the outstanding
PFSweb common stock. The dividend was paid at the close of business on July 6,
2000 to the holders of record of Daisytek common stock as of the close of
business on June 19, 2000, in the amount of 0.81 of a share of PFSweb common
stock for each share of outstanding Daisytek common stock, as described below.
Holders of Daisytek common stock on the record date were not required
to pay any cash or other consideration for the shares of PFSweb common stock
distributed to them or to surrender or exchange their shares of Daisytek common
stock in order to receive the dividend of PFSweb common stock.
No fractional shares were issued in connection with the spin-off.
Instead, ChaseMellon Shareholder Services, the distribution agent for the
spin-off, was instructed to aggregate all of the fractional shares into whole
shares and sell them in an open market transaction. Holders of Daisytek common
stock who otherwise would be entitled to receive a fractional share will receive
a cash payment in the amount of their pro rata share of the total net proceeds
of that sale.
Further information regarding the spin-off and the relationship
between Daisytek and PFSweb may be found in the Information Statement dated June
20, 2000 (filed as Exhibit 99 to Form 8-K filed by Daisytek on June 22, 2000)
and the PFSweb Prospectus dated December 2, 1999.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro Forma Financial Information
The unaudited pro forma consolidated financial information of the
Company, included in Item 7(b) of this Report, is based on and should be read in
conjunction with the audited consolidated financial statements and notes thereto
appearing in the Company's Annual Report on Form 10-K for the year ended March
31, 2000. The accompanying unaudited pro forma consolidated balance sheet gives
effect to the Distribution of the common stock of PFSweb as if the Distribution
had occurred on March 31, 2000. The accompanying unaudited pro forma
consolidated statements of operations gives effect to the Distribution as if the
Distribution had occurred on April 1, 1999.
The pro forma financial statements are not necessarily indicative of
the current or future financial position or results of operations of the Company
and such statements should be read in the context of the Company's historical
consolidated financial statements. The pro forma adjustments are based upon
information currently available to the Company and contain estimates and
assumptions. Management believes that the estimates and assumptions provide a
reasonable basis for presenting the significant effects of the Distribution and
that the pro forma adjustments give appropriate effect to these estimates and
assumptions and are properly applied in the pro forma financial statements.
-2-
<PAGE> 3
DAISYTEK INTERNATIONAL CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
MARCH 31, 2000
(IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
COMPANY PFSWEB PRO FORMA COMPANY
AS REPORTED AS REPORTED ADJUSTMENTS (1) PRO FORMA
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents ................................ $ 28,186 $ 24,896 $ -- $ 3,290
Accounts receivable, net of allowance for doubtful
accounts ............................................... 167,705 8,892 -- 158,813
Inventories, net ......................................... 96,371 -- -- 96,371
Due from PFSweb .......................................... -- -- 4,707 4,707
Prepaid expenses and other current assets ................ 7,812 8,969 4,540 3,383
Income taxes receivable .................................. 3,714 -- -- 3,714
Deferred tax asset, net .................................. 249 -- -- 249
------------ ------------ ------------ ------------
Total current assets ............................. 304,037 42,757 9,247 270,527
------------ ------------ ------------ ------------
PROPERTY AND EQUIPMENT, net ................................ 30,660 21,555 -- 9,105
OTHER ASSETS ............................................... 528 528 -- --
EMPLOYEE RECEIVABLE ........................................ 518 -- -- 518
EXCESS OF COST OVER NET ASSETS ACQUIRED, net ............... 37,003 -- -- 37,003
------------ ------------ ------------ ------------
Total assets ..................................... $ 372,746 $ 64,840 $ 9,247 $ 317,153
============ ============ ============ ============
LIABILITIES AND SHAREHOLDERS'
EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt ........................ $ 42,392 $ 274 $ -- $ 42,118
Trade accounts payable ................................... 92,978 6,277 4,540 91,241
Payable to Daisytek ...................................... -- 4,707 4,707 --
Accrued expenses ......................................... 14,746 3,525 -- 11,221
Income taxes payable ..................................... -- -- -- --
------------ ------------ ------------ ------------
Total current liabilities ........................ 150,116 14,783 9,247 144,580
------------ ------------ ------------ ------------
LONG-TERM DEBT, less current portion ....................... 2,431 2,407 -- 24
------------ ------------ ------------ ------------
MINORITY INTEREST .......................................... 9,513 -- (9,513)(3)(4) --
------------ ------------ ------------ ------------
SHAREHOLDERS' EQUITY:
Preferred stock, $1.00 par value; 1,000,000 shares
authorized at March 31, 2000 and 1999, none issued
and outstanding ........................................ -- -- -- --
Common stock, $0.01 par value; 30,000,000 shares
authorized at March 31, 2000; 17,600,164 shares
issued and outstanding at March 31, 2000 ............... 176 18 18 (5) 176
Additional paid-in capital ............................... 136,736 50,673 7,136 (3)(4)(5) 93,199
Retained earnings (deficit) .............................. 76,340 (2,836) 2,359 (3)(4) 81,535
Accumulated other comprehensive income (loss) ............ (2,566) (205) -- (2,361)
------------ ------------ ------------ ------------
Total shareholders' equity ....................... 210,686 47,650 9,513 172,549
------------ ------------ ------------ ------------
Total liabilities and shareholders' equity ....... $ 372,746 $ 64,840 $ 9,247 $ 317,153
============ ============ ============ ============
</TABLE>
See Notes to Unaudited Pro Forma Consolidated Financial Statements.
-3-
<PAGE> 4
DAISYTEK INTERNATIONAL CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED MARCH 31, 2000
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
COMPANY PFSWEB INTERCOMPANY COMPANY PRO FORMA COMPANY
AS REPORTED AS REPORTED ELIMINATIONS ADJUSTED ADJUSTMENT(2) PRO FORMA
----------- ----------- ------------ ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
NET REVENUES .................................. $ 1,060,147 $ 86,607 $ (19,284) $ 992,824 $ -- $ 992,824
COST OF SALES ................................. 957,006 76,114 (7,160) 888,052 -- 888,052
----------- ----------- ------------ ----------- ----------- -----------
Gross profit ................................ 103,141 10,493 (12,124) 104,772 -- 104,772
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES .. 90,844 17,764 (12,124) 85,204 -- 85,204
ACQUISITION RELATED COSTS ..................... 619 -- -- 619 -- 619
LOSS ON DISPOSITION OF BUSINESS ............... (1,000) -- -- (1,000) -- (1,000)
----------- ----------- ------------ ----------- ----------- -----------
Income (loss) from operations ............... 12,678 (7,271) -- 19,949 -- 19,949
INTEREST EXPENSE .............................. 4,035 459 -- 3,576 -- 3,576
----------- ----------- ------------ ----------- ----------- -----------
Income (loss) before income taxes ........... 8,643 (7,730) -- 16,373 -- 16,373
PROVISION (BENEFIT) FOR INCOME TAXES .......... 4,670 (1,791) -- 6,461 -- 6,461
----------- ----------- ------------ ----------- ----------- -----------
Income (loss) before minority interest ........ 3,973 (5,939) -- 9,912 -- 9,912
MINORITY INTEREST ............................. 566 -- -- 566 (566)(3) --
----------- ----------- ------------ ----------- ----------- -----------
NET INCOME (LOSS) ............................. $ 4,539 $ (5,939) $ -- $ 10,478 $ (566) $ 9,912
=========== =========== ============ =========== =========== ===========
NET INCOME (LOSS) PER COMMON SHARE:
Basic ....................................... $ 0.26 $ 0.61 $ 0.57
=========== =========== ===========
Diluted ..................................... $ 0.25 $ 0.58 $ 0.55
=========== =========== ===========
WEIGHTED AVERAGE COMMON AND COMMON SHARE
EQUIVALENTS OUTSTANDING:
Basic .................................... 17,248 17,248 17,248
Diluted .................................. 18,186 18,186 18,186
</TABLE>
See Notes to Unaudited Pro Forma Consolidated Financial Statements.
-4-
<PAGE> 5
DAISYTEK INTERNATIONAL CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(in thousands)
(1) Reflects adjustments for the spin-off of PFSweb as if it had taken place as
of the date presented.
(2) Reflects adjustments for the spin-off of PFSweb as if it had taken place at
April 1, 1999.
(3) Reflects elimination of 19.9% minority share of PFSweb's loss.
(4) Reflects $10,079 elimination of 19.9% minority share of proceeds from
PFSweb's December 2, 1999 initial public offering and the Company's net
equity investment in PFSweb.
(5) Reflects $18 reclassification of PFSweb's common stock to additional
paid-in capital.
(6) Reflects reclassification of intercompany receivable and payable.
(7) Reflects adjustment to reverse an elimination entry in the consolidating
group.
(8) Reflects elimination of professional fees related to legally separating
PFSweb from the Company.
-5-
<PAGE> 6
(c) Exhibits
2.1 Amendment to Initial Public Offering and Distribution
Agreement dated July 6, 2000 by and among Daisytek
International Corporation, Daisytek, Incorporated and
PFSweb, Inc.
-6-
<PAGE> 7
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 hereunto duly authorized.
DAISYTEK INTERNATIONAL CORPORATION
Dated: July 21, 2000 By: /s/ RALPH MITCHELL
Ralph Mitchell
Chief Financial Officer,
Executive Vice President - Finance
-7-
<PAGE> 8
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
---------- ---------
<S> <C>
2.1 Amendment to Initial Public Offering and Distribution
Agreement dated July 6, 2000 by and among Daisytek
International Corporation, Daisytek, Incorporated and
PFSweb, Inc.
</TABLE>
