There is distinctly unique about Steve Burd's connection to Hillside Covenant Church where their youth director breached my laptop in 2011 and several weeks my car was deliberately totaled in Lafayette CA but Chief Christanson refused to investigate. Several months later I handed documents to Chief Bryden about Gary Vinson Collins who is now dead.
In 1995 I revealed my reports to ComputerLand Management where it was clear as day they we're losing or had lost millions. The losses were the classic "Rocks in the Box" where returns were arriving after being stalled at VanStar distribution.
Long after Merisel bought the rights to distribution the losses tallied up to millions. I remember arguing with one long term employee who later was in tears. When Merisel's stock tanked she lost everything that she invested in the closed ended investment model.
More later.
-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FGezcPuUxKcjs61Vzk6mSOUl6mA4dPRr9G9yMZocPFCFmUwUSKb6Yb1VT0KQ5g7+ RUlpIphMM+5WvvbFYyTrZQ==0000724941-97-000005.txt : 19970416 -----END PRIVACY-ENHANCED MESSAGE-----0000724941-97-000005.hdr.sgml : 19970416 ACCESSION NUMBER: 0000724941-97-000005 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970328 ITEM INFORMATION: Acquisition or disposition of assets FILED AS OF DATE: 19970415 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: MERISEL INC /DE/ CENTRAL INDEX KEY: 0000724941 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-COMPUTER & PERIPHERAL EQUIPMENT & SOFTWARE [5045] IRS NUMBER: 954172359 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-17156 FILM NUMBER: 97580987 BUSINESS ADDRESS: STREET 1: 200 CONTINENTAL BLVD CITY: EL SEGUNDO STATE: CA ZIP: 90245-0984 BUSINESS PHONE: 3106153080 MAIL ADDRESS: STREET 1: 200 CONTINENTAL BLVD CITY: EL SEGUNDO STATE: CA ZIP: 90245-0984 FORMER COMPANY: FORMER CONFORMED NAME: SOFTSEL COMPUTER PRODUCTS INC DATE OF NAME CHANGE: 19910509 8-K 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: April 14, 1997 MERISEL, INC. (Exact name of registrant as specified in its charter) Delaware 0-17156 95-4172359 (State or other jurisdiction (Commission File (I.R.S. Employer of incorporation or Number) Identification Number) organization) 200 Continental Boulevard El Segundo, CA 90245-0984 (Address of principal executive offices) (Zip code) (310) 615-3080 (Registrant's telephone number, including area code) -1- Item 2. Acquisition or Disposition of Assets On March 31, 1997, Merisel, Inc., a Delaware corporation (the ("Company") completed the sale of substantially all of the assets of its wholly-owned subsidiary Merisel FAB, Inc., a Delaware corporation ("Merisel FAB"),to ComputerLand Corporation (ComputerLand), a wholly-owned subsidiary of SYNNEX Information Technologies, Inc., a California corporation ("Synnex"). Merisel FAB operates the Company's Franchise and Aggregation Business ("FAB"). The sale was effective as of March 28, 1997, pursuant to a Purchase Agreement (the"Purchase Agreement") dated January 15, 1997, as amended, among the Company, Merisel FAB, Computerland and Synnex. The sale price, computed based upon the February 21, 1997 balance sheet of Merisel FAB was approximately $31,992,000 consisting of ComputerLand assuming $11,992,000 of trade payables and accrued liabilities and a $20,000,000 extended payable due to a third party. As part the sale, the Company agreed to extend rebates to Synnex on future purchases at a defined rate per dollar of purchases, not to exceed $2,000,000. The purchase price is subject to adjustments based upon Merisel FAB's March 28, 1997 balance sheet. In the quarter ended December 31, 1996, the Company recorded an impairment charge of $2,033,000 to adjust Merisel FAB's Assets to their fair value. For additional information see the March 31, 1997 press release of Merisel, Inc.,a copy of which is attached hereto as an exhibit. Item 7. Financial Statements and Exhibits (a) Financial Statements of Business Acquired. Not Applicable (b) Pro Forma Financial Information The Following unaudited pro forma financial statements are filed with this report: Pro Forma Condensed Consolidated Balance Sheet as of December 31, 1996................................. Page 4 Pro Forma Condensed Consolidated Statements of Earnings: Year Ended December 31,1996................................... Page 5 Year Ended December 31,1995................................... Page 6 Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements....................................... Pages 7-8 -2- The unaudited Pro Forma Condensed Consolidated Balance Sheet of the Company as of December 31, 1996 reflects the financial position of the Company after giving effect to the disposition of substantially all of FAB as discussed in Item 2 and assumes the disposition took place on December 31, 1996. The Pro Forma Condensed Consolidated Statements of operations for the years ended December 31, 1995 and December 31, 1996 assume that the disposition occurred on January 1, 1995 and January 1, 1996, respectively and are based on the operations of the Company for the years ended December 31, 1995 and December 31, 1996. The unaudited pro forma condensed consolidated financial statements presented herein are shown for illustrative purposes only and are not necessarily indicative of the future financial position or future results of operations of the Company, or of the financial position or results of operations of the Company that would have actually occurred had the transaction occurred as of the date or for the periods presented. The unaudited pro forma condensed consolidated financial statements should be read in conjunction with the historical financial statements and related notes of the Company. (c) Exhibits 2.1 Purchase Agreement dated as of January 15, 1997 by and among Merisel, Inc., Merisel FAB., Inc., Syn Fab, Inc., and Synnex Information Technologies, Inc.(1) 2.2 Amendment No. 1 to Asset Purchase Agreement dated as of March 6, 1997. (1) 99.1 Press release of Merisel, Inc. Dated March 31, 1997. - ----------------- (1) Incorporated herein by reference to the Annual Report on Form 10-K of the Company for the annual period ended December 28, 1996. -3- PRO FORMA FINANCIAL INFORMATION MERISEL, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (In thousands) See accompanying notes to unaudited pro forma condensed consolidated financial statements. -4-
Pro Forma Adjustments Historical 12/31/96 FAB Other Pro Forma Current Assets: Cash & Cash Equivalents $ 44,678 $44,678 Accounts Receivable (net of allowances) 168,295 $6,850(a) 161,445 Inventories 392,557 392,557 Prepaid Expenses 16,925 16,925 Income Taxes Receivable 2,183 2,183 Deferred Income Tax Benefit 482 482 -------- ------- -------- ------- Total current assets 625,120 6,850 618,270 Property and Equipment, Net 61,430 542(a) 60,888 Cost in Excess of Net Assets Acquired 41,724 15,374(b) 26,350 Other Assets 2,765 2,765 -------- -------- -------- ------- Total Assets 731,039 22,766 708,273 -------- -------- -------- ------- -------- -------- -------- ------- Current Liabilities: Accounts Payable $383,548 $25,711(a) $357,837 Accrued Liabilities 37,543 952(a) 4,085(c) 40,676 Short-Term Debt Long-Term Debt-Current 9,084 9,084 Subordinated Debt-Current 4,400 4,400 -------- -------- -------- ------- Total Current Liabilities 434,575 26,663 4,085 411,997 Long-Term Debt 268,079 268,079 Subordinated Debt 13,200 13,200 other Long-term Debt 188 188(a) --------- -------- -------- -------- Total Liabilities 716,042 26,851 4,085 693,276 --------- -------- -------- -------- Total Stockholders' Equity 14,997 (4,085) (4,085) 14,997 Total Liabilities and Stockholders Equity $731,039 $22,766 $708,273 -------- -------- --------- -------- -------- -------- --------- -------- PRO FORMA FINANCIAL INFORMATION MERISEL, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 (In Thousands, Except Per Share Data) See accompanying notes to unaudited pro forma condensed consolidated financial statements. -6-
Pro Forma Adjustments Historical 12/31/96 FAB (a) Other Pro Forma Net Sales $5,522,824 $1,021,310 $4,501,514 Cost of Sales 5,233,570 984,515 4,249,055 ---------- ---------- ---------- ---------- Gross Profit 289,254 36,795 252,459 Selling, General & Administrative Expenses 295,021 33,689 261,332 Impairment Loss 42,033 42,033 ---------- ---------- ---------- ---------- Operating Loss (47,800) (38,927) (8,873) Loss on Sale of European, Mexican and Latin American Operations 33,455 33,455 Interest Expense 37,431 255 37,176 Other Expense 20,150 58 20,092 ---------- ---------- ---------- ---------- Loss Before Income Taxes (138,836) (39,240) (99,596) Income Tax Provision (1,539) (60) (1,479) ---------- ---------- ---------- ---------- Net Loss $(140,375) $(39,300) $(101,075) ---------- ---------- ---------- ----------- ---------- ---------- ---------- ----------- Net Loss Per Share $ (4.68) $ (3.37) ---------- ---------- ---------- ----------- ---------- ---------- ---------- ----------- Weighted Average Number of Shares Outstanding 30,001 30,001 ----------- ---------- ----------- ---------- PRO FORMA FINANCIAL INFORMATION MERISEL, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1995 (In Thousands, Except Per Share Data) See accompanying notes to unaudited pro forma condensed consolidated financial statements. -7-
Pro Forma Adjustments Historical 12/31/96 FAB (a) Other ProForma Net Sales $5,956,967 $1,141,094 $ $4,815,873 Cost of Sales 5,633,278 1,097,673 4,535,605 ---------- ---------- ---------- ---------- Gross Profit 323,689 43,421 280,268 Selling, General & Administrative Expenses 317,195 41,468 2,986(b) 278,713 Impairment Losses 51,383 30,000 21,383 Restructuring Charge 9,333 9,333 ---------- ---------- ----------- ---------- Operating Loss (54,222) (28,047) (2,986) (29,161) Interest Expense 37,583 4,210 33,373 Other Expense 13,885 137 13,748 ---------- ---------- ---------- ---------- Loss Before Income Taxes (105,690) (32,394) (2,986) (76,282) Income Tax Benefit 21,779 903 20,876 ---------- ---------- ---------- ----------- Net Loss $ (83,911) $ (31,491) $ (2,986) $ (55,406) ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- Net Loss Per Share $ (2.82) $ (1.86) ---------- ---------- ---------- ---------- Weighted Average Number of Shares Outstanding 29,806 29,806 ----------- ---------- ----------- ---------- Notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements 1. General The foregoing unaudited pro forma condensed consolidated financial statements illustrate the effect of the sale by the Company of substantially all the assets of Merisel FAB, Inc. to ComputerLand Corporation ("ComputerLand"), a wholly owned subsidiary of SYNNEX Information Technologies, Inc. ("Synnex") pursuant to a Purchase Agreement (the "Purchase Agreement") among the Company, Merisel FAB, Inc., ComputerLand, and Synnex. Merisel FAB operates the Company's Franchise and Aggregation Business ("FAB"). The sales price, if computed at December, 31 1996, would have been $26,850,000 consisting of $6,850,000 of trade payable and accrued liabilites and a $20,000,000 extended payable due to Vanstar Corporation. As part of the sale, the Company agreed to extend rebates to Synnex on future purchases at a defined rate per dollar of purchases, not to exceed $2,000,000. The sales price is subject to adjustments based upon the March 28, 1997 balance sheet. Because the Company recorded an impairment charge of $2,033,000 in the quarter ended December 31, 1996 to adjust Merisel FAB's assets to their fair value, the recognition of this sale as of December 31, 1996 would not result in a loss as follows: Purchase price 26,850,000 Book value of FAB Assets purchased (7,392,000) Value of rebates to be paid to buyer (2,000,000) Intangible assets associated with FAB to be written off (15,374,000) Estimated direct and other costs associated with the transaction (2,084,000) ------------ Loss on Sale of FAB 0 ------------ ------------ 2. Pro Forma Balance Sheet Adjustments a)FAB - Represents the historical unaudited December 31, 1996 balances for Merisel FAB for those assets transferred to, and liabilities assumed by ComputerLand. b) Cost in excess of net asset acquired - Amounts relate to Merisel FAB which will be written off as a result of the sale. c) Accrued Liabilities - Represents adjustments to accrue $2,000,000 of rebates extended to Synnex as part of the purchase agreement, and $2,085,000 of direct costs associated with the sale of FAB. 3. Pro Forma Income Statement Adjustments for the Year Ended December 31, 1996 a)FAB - Represents the historical unaudited December 31, 1996 balances for Merisel FAB which are eliminated to reflect the sale of Merisel FAB. 4. Pro Forma Income Statement Adjustments for the Year Ended December 31, 1995 a)FAB - Represents the historical unaudited December 31, 1995 balances for Merisel FAB which are eliminated to reflect the sale of Merisel FAB. b)Selling, General and Administrative Expenses. In 1995 certain corporate costs were allocated by Merisel to Merisel FAB (corporate overhead, administrative expenses, etc.). It is likely that such costs would not have been eliminated due to the sale of FAB, and are therefore added back for the purposes of this pro forma presentation. -7- SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereto duly authorized. MERISEL, INC. Date: April 14, 1997 /S/ JAMES E. ILLSON ---------------------------- James E. Illson, Senior Vice President Finance, and Chief Financial Officer (Duly authorized officer and principal financial officer) EX-99 2 For Immediate Release Financial Media/Investor Relations: Rivian Bell (310) 615-6812 (310) 615-6868 (800) 686-1910 (24-hour pager) Richard Bernhardt Sr. Manager, Marketing Communications ComputerLand Corporation (510) 467-6097 richard.bernhardt@merisel.com Merisel Completes Sale of FAB Subsidiary El Segundo, Calif. (March 31, 1997) -- Merisel, Inc. (NASDAQ:MSEL) announced today that, as of March 28, 1997, the company has completed the sale of substantially all of the assets of its wholly owned subsidiary, Merisel FAB, Inc., to ComputerLand Corporation, a wholly owned subsidiary of Synnex Information Technologies, Inc., a Fremont, Calif.-based distributor of microcomputers and communication, networking, peripheral, and storage products. Merisel FAB, Inc. operated the company's ComputerLand Franchise and Datago businesses. Terms of the sale called for the buyer to acquire substantially all of the assets and assume substantially all of the liabilities of Merisel FAB, Inc. The liabilities assumed by the buyer include an extended payable of $20,000,000 due to Vanstar Corporation. In the quarter ended Dec. 31, 1996, Merisel, Inc. recorded an impairment charge of $2,033,000 to adjust Merisel FAB's assets to fair market value. Merisel, Inc. (NASDAQ:MSEL) is a leader in the distribution of computer hardware, software and networking products. Merisel distributes a full line of 25,000 products to more than 45,000 resellers throughout the U.S. and Canada. Additional information can be obtained through the company's World Wide Web site (http://www.merisel.com) or by requesting information by fax at (310) 615-6811. # # #
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