UNITED STATES
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) May 18, 2000
GROW BIZ INTERNATIONAL, INC.
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(Exact Name of Issuer as Specified in Charter)
Minnesota 0-22012 41-1622691
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(State or Other Jurisdiction or (Commission File (I.R.S. Employer
Incorporation or Organization) Number) Identification Number)
4200 Dahlberg Drive, Golden Valley, MN 55422-4837
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(Address of Principal Executive Offices)
(612) 520-8500
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(Registrant's Telephone Number, Including Area Code)
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ITEM 5. Other Events
On May 18, 2000, Grow Biz International, Inc. announced that it will record
a $2.5 million charge to earnings in the second quarter. This event is further
described in the Press Release dated May 18, 2000, which is incorporated herein
by reference.
ITEM 7. Financial Statements and Exhibits
(c) Exhibits
99.1 Press Release dated May 18, 2000
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<PAGE>
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 thereunto duly authorized.
GROW BIZ INTERNATIONAL, INC.
Date: May 26, 2000 By: /s/ John L. Morgan
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John L. Morgan
Chairman and Chief Executive Officer
Date: May 26, 2000 By: /s/ David J. Osdoba, Jr.
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David J. Osdoba, Jr.
Senior Vice President of Finance and
Chief Financial Officer
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Contact: David J. Osdoba, Jr. EXHIBIT 99.1
612-520-8500
FOR IMMEDIATE RELEASE
GROW BIZ INTERNATIONAL INC. ANNOUNCES EARNINGS CHARGE
Minneapolis, MN (May 18, 2000) -- Grow Biz International, Inc. announced today
that it will be booking a charge to earnings in the second quarter of
approximately $2.5 million. This charge consists primarily of two components.
First, approximately one-half of the charge relates to management's assessment
of current information relating to notes receivable booked in connection with a
sale of Company-owned stores. The other component relates to management's
strategic decision to re-evaluate certain of its franchising concepts and
Company-owned stores that are not performing at expected levels. In conjunction
with this decision, management has written-off certain intangible assets that
are under-performing or are not consistent with its core strategy - franchising.
John L. Morgan, Chairman and CEO, stated, "In order to turn the Company around
we believe these changes are necessary."
Mr. Morgan went on to say, "We are continuing to work on financing to replace
our current credit facilities that expire on July 31, 2000 and are not being
renewed by our bank. We anticipate that financial institutions will require the
Company to raise additional funds or provide a guarantee from a third party in
connection with the refinancing."
Grow Biz International, Inc. develops franchises which operate value-oriented
retail concepts for stores that buy, sell, trade and consign used and new
merchandise. At March 25, 2000, the Company had 1,131 stores in operation and an
additional 88 franchises awarded but not open. Of the stores in operation, there
were 596 Play It Again Sports(R), 224 Once Upon A Child(R), 209 Computer
Renaissance(R), 80 Music Go Round(R), 13 Retool(R) and 9 Plato's Closet(R)
stores.
