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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) MAY 31, 1996
KIDS MART, INC.
(Exact name of registrant as specified in its charter)
FLORIDA 0-21910 65-0406710
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
801 SENTOUS AVENUE, CITY OF INDUSTRY, CALIFORNIA 91748
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code:
(818) 854-3166
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Item 5. Other Events
On May 31, 1996, Kids Mart, Inc. (the "Company"), a Florida corporation, settled
its disputes and pending litigation with Woolworth Corporation ("Woolworth") and
Kinney Shoe Corporation. Pursuant to the terms of the settlement agreement,
approximately $13.8 million of debt owed or claimed to be owed by LFS
Acquisition Corp., a wholly-owned subsidiary of the Company, to Woolworth was
canceled and approximately $1.67 million deposited in an escrow account was
released to the Company. Also, the Company issued to Woolworth 1,000,000 shares
of a new series of the Company's convertible non-voting preferred stock. The
terms of the settlement agreement are more fully described in the Press Release
of the Company, dated May 31, 1996, and attached to this Report as Exhibit 99.1.
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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.
KIDS MART, INC.
Date: June 4, 1996 By /s/ Robert Kelleher
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Robert Kelleher
Vice President, Chief Operating
Officer and Chief Financial Officer
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INDEX TO EXHIBITS
Exhibit Number Description of Exhibit
99.1 Press Release of the Company
dated May 31, 1996
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EXHIBIT 99.1
FOR IMMEDIATE RELEASE
CONTACT: Bernie Tessler
Chairman and Chief Executive Officer
(818) 854-3166
Robert S. Kelleher
Vice President, Chief Operating Officer and Chief Financial Officer
(818) 854-3804
KIDS MART, INC. ANNOUNCES SETTLEMENT WITH WOOLWORTH
City of Industry, Ca. (May 31, 1996) -- Kids Mart, Inc. (OTC:KIDM) (f/k/a Frost
Hanna Acquisition Group, Inc.) (the "Company"), a Florida corporation, today
announced that it settled its disputes and pending litigation with Woolworth
Corporation ("Woolworth") and Kinney Shoe Corporation ("Kinney").
The Company's predecessor-in-interest, LFS Acquisition Corp. ("LFS"), had
instituted a civil suit against Woolworth and Kinney in December 1995 asserting
causes of action for fraud, negligent misrepresentation and breach of contract
stemming from the acquisition (the "Acquisition") by LFS of the Kids
Mart/Little Folks business from Woolworth and Kinney on May 31, 1995. Woolworth
and Kinney denied the allegations and counter-claimed for breach of contract.
Pursuant to the terms of the Settlement Agreement, all of the parties'
respective claims against the other, including all remaining payment
obligations of LFS related to the Acquisition and the related transitional
service agreement, were released and discharged. Woolworth was issued 1,000,000
shares of a new series of the Company's convertible non-voting preferred stock.
Also, approximately $1.67 million deposited in an escrow account following the
Acquisition was released to the Company. Further, the parties agreed to extend
to October 1996 an agreement with LFS whereby Woolworth performs certain MIS
services for the Company. Management believes this settlement will have a
positive impact on the Company's results of operation for the period ended
January 27, 1996.
Bernie Tessler, Chairman and Chief Executive Officer of the Company stated that
"the settlement with Woolworth is another step towards implementing the
Company's program to revitalize Kids Mart, and it will allow the Company to
refocus its energies on doing what it does best, innovatively selling
children's clothing."
The Company is a value oriented specialty retailer of children's apparel,
located in malls and strip centers. It currently operates 296 children's apparel
stores in 20 states under the names Kids Mart (282 stores) and Little Folks
(14 stores).
