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): March 22, 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 March 22, 2000, Grow Biz International, Inc. (the "Company")
announced the appointment of John L. Morgan as a member of the Company's Board
of Directors, its Chairman of the Board and its Chief Executive Officer. Mr.
Morgan replaced K. Jeffrey Dahlberg, who resigned from his positions as a
director, the Company's Chairman of the Board and its Chief Executive Officer
effective March 22, 2000.
In a private transaction occurring on March 22, 2000, Mr. Morgan and
his associates acquired 700,000 shares of Company common stock, which represents
approximately 13% of the outstanding Company stock, from Mr. Dahlberg for $7.00
per share.
Upon his appointment as Chief Executive Officer, Mr. Morgan entered
into an employment agreement with the Company, which provides for an annual
salary of $50,000 and an option to acquire up to 600,000 shares of Company
common stock, with an exercise price of $5.00 per share, a five-year vesting
period and a six-year term.
In connection with the change in the Company's management, the
Company issued to Sheldon T. Fleck a warrant (the "Warrant") for the purchase of
200,000 shares of the Company's common stock, for an exercise price of $6.00 per
share. The Company issued the Warrant to Mr. Fleck as compensation for his
services as a financial advisor to the Company, in accordance with the terms of
a Letter Agreement between the Company and Mr. Fleck, dated as of November 17,
1999.
This transaction is further described in the Press Release, dated
March 22, 2000, which is incorporated herein by reference.
ITEM 7. Financial Statements and Exhibits
(c) Exhibits
99.1 Press release dated March 22, 2000
<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: March 29, 2000 By: /s/ John L. Morgan
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John L. Morgan
Chairman and Chief Executive Officer
Contact: David J. Osboda, Jr. EXHIBIT 99.1
612-520-8500
GROW BIZ INTERNATIONAL, INC. ANNOUNCES APPOINTMENT OF NEW CHAIRMAN AND CEO
WEDNESDAY, MARCH 22, 2000 5:32 PM
- PRNewswire
MINNEAPOLIS, Mar 22, 2000 /PRNewswire via COMTEX/ -- Grow Biz International,
Inc. (Nasdaq:GBIZ) announced today the appointment of John Morgan as Chairman
and Chief Executive Officer of the Company.
Mr. Morgan was a founder and president of Winthrop Resources, an equipment
leasing company, from 1982 through March 1999. Winthrop was sold to TCF
Financial Corporation in 1997 in a transaction valued at $325 million. Among
other things, Winthrop leased and sold computer equipment. Prior to founding
Winthrop in 1982, Mr. Morgan held various management positions with companies in
the computer industry, including IBM, Memorex and Data Serv.
Commenting on the appointment, Mr. Morgan stated, "This is an exciting
opportunity to lead a young, dynamic company with system-wide revenue in excess
of $500 million. The challenge we face is to move the Company forward in this
new internet economy."
In his new role, Mr. Morgan succeeds K. Jeffrey Dahlberg, who has resigned from
his positions with the Company. Mr. Dahlberg, who remains one of the largest
shareholders, commented, "We are very fortunate to attract a man of John's
character and proven track record to lead our Company. The Company is well
positioned and poised for growth under the leadership John will provide."
In a private transaction, Mr. Morgan and his associates acquired 700,000 shares
of Company common stock, which represents approximately 13% of the outstanding
Company stock, from K. Jeffrey Dahlberg for $7.00 per share.
Grow Biz International, Inc. develops, franchises and operates value-oriented
retail concepts for stores that buy, sell, trade and consign used and new
merchandise. At December 25, 1999, the Company had 1,143 stores in operation and
an additional 88 franchises awarded but not open. Of the stores in operation,
there were 614 Play It Again Sports(R), 221 Once Upon A Child(R), 211 Computer
Renaissance(R), 80 Music Go Round(R), 12 ReTool(R) and 5 Plato's Closet(R)
stores.
This press release contains, in addition to historic information,
forward-looking statements that involve risks and uncertainties. Such
forward-looking statements include, without limitation, the statements regarding
the effect of the change in management and the future direction of the Company.
All such forward-looking statements are based on management's current
expectations and are subject to a number of uncertainties and risks that could
cause actual results to differ materially from those described in the
forward-looking statements. Among the most important factors that would cause
actual results to differ materially from those indicated by such forward-looking
statements include the Company's ability to attract qualified franchisees, the
Company's ability to collect its receivables, the Company's ability to open
stores, each store's ability to acquire high-quality, used merchandise, the
Company's ability to control selling, general and administrative expenses, the
Company's ability to operate the Company-owned retail stores profitably, the
Company's ability to obtain competitive financing to fund its growth, and the
other risk factors detailed from time to time in the Company's periodic reports
filed with the Securities and Exchange Commission.
SOURCE Grow Biz International, Inc.
