SEC Info  
    Home      Search      My Interests      Help      Sign In      Please Sign In

Take Two Interactive Software Inc – ‘8-K/A’ for 12/24/97

As of:  Wednesday, 3/4/98   ·   For:  12/24/97   ·   Accession #:  891554-98-231   ·   File #:  0-29230

Previous ‘8-K’:  ‘8-K’ on 1/7/98 for 12/24/97   ·   Next:  ‘8-K’ on 3/25/98 for 3/18/98   ·   Latest:  ‘8-K’ on 4/1/24 for 3/27/24

Find Words in Filings emoji
 
  in    Show  and   Hints

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 3/04/98  Take Two Interactive Software Inc 8-K/A:7    12/24/97    1:23K                                    Document Techs Inc/FA

Amendment to Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K/A       Amendment No. 1                                       12     51K 


Document Table of Contents

Page (sequential) | (alphabetic) Top
 
11st Page   -   Filing Submission
2Item 7. Financial Statements and Exhibits
8-K/A1st Page of 12TOCTopPreviousNextBottomJust 1st
 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K/A (Amendment No.1) CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of Earliest Event Reported) : Dec 24, 1997 TAKE-TWO INTERACTIVE SOFTWARE, INC. DELAWARE 0-29230 51-0350842 (State or other juridiction) (Commission (I.R.S. Employer of incoropration) File Number) Identification No.) 575 Broadway, New York, NY 10012 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (212) 941-2988 Not Applicable Former name or former address, if changed since last report
8-K/A2nd Page of 12TOC1stPreviousNextBottomJust 2nd
Item 7. Financial Statements and Exhibits. The following financial statements and pro forma financial information omitted from Form 8-K for the event dated December 24, 1997, in reliance upon instructions 7 (a) (4) and 7 (b) (2) of Form 8-K, are filed herewith. (a) Financial Statements of the Businesses Acquired. 1. Financial Statements of L & J Marketing, Inc. D/B/A Alliance Distributors Independent Auditors' Report Balance Sheets as of December 31, 1995 and 1996 Balance Sheet as of September 30, 1997 (unaudited) Statements of Income and Retained Earnings for the years ended December 31, 1995 and 1996 Statements of Income and Retained Earnings for the nine months ended September 30, 1996 and 1997 (unaudited) Statements of Cash Flows for the years ended December 31, 1995 and 1996 Statements of Cash Flows for the nine months ended September 30, 1996 and 1997 (unaudited) Notes to Financial Statements (b) Pro Forma Financial Information. Unaudited Pro Forma Consolidated Financial Statements for Take-Two Interactive Software, Inc. and Subsidiaries Unaudited Pro Forma Consolidated Statement of Operations for the year ended October 31, 1997. Notes to Unaudited Pro Forma Consolidated Financial Statements for the year ended October 31, 1997. (c) Exhibits. Reference is made to the Exhibits previously filed with the Securities and Exchange Commission as Exhibits to the Company's Report on Form 8-K for the event dated December 24, 1997.
8-K/A3rd Page of 12TOC1stPreviousNextBottomJust 3rd
Independent Auditor's Report Stockholders L & J Marketing, Inc. D/B/A Alliance Distributors College Point, NY We have audited the accompanying balance sheets of L & J Marketing, Inc. D/B/A Alliance Distributors as of December 31, 1996 and 1995 and the related statements of income and retained earnings, and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of L & J Marketing, Inc. D/B/A Alliance Distributors as of December 31, 1996 and 1995, and the results of its operations and its cash flows for the years then ended in conformity with generally accepted accounting principles. /s/ BERENSON & COMPANY LLP New York, NY February 19, 1997
8-K/A4th Page of 12TOC1stPreviousNextBottomJust 4th
L & J MARKETING, INC. D/B/A ALLIANCE DISTRIBUTORS BALANCE SHEETS As of December 31, 1995 and 1996 and September 30, 1997 (unaudited) [Enlarge/Download Table] December 31, December 31, September 30, 1995 1996 1997 ------------ ------------ ------------- (unaudited) ASSETS Current assets: Cash $ 101,405 $ 24,593 $ 12,291 Accounts receivable, net of allowance for doubtful accounts of $30,000; $15,000-1995 (note 4) 1,629,774 2,903,584 2,594,948 Inventory (notes 4 and 7) 5,199,708 5,237,481 5,037,292 Prepaid expenses and other current assets 20,796 27,947 29,981 ---------- ---------- ---------- Total current assets 6,951,683 8,193,605 7,674,512 Property and equipment, net (note 3) 119,604 105,549 89,938 Security deposits 22,270 22,270 22,270 ---------- ---------- ---------- $7,093,557 $8,321,424 $7,786,720 ========== ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Note and acceptances payable, bank (note 4) $ 800,000 $2,395,615 $3,705,479 Accounts payable (note 7) 4,684,888 4,198,364 2,324,480 Accrued expenses 56,433 74,019 43,860 ---------- ---------- ---------- Total current liabilities 5,541,321 6,667,998 6,073,819 ---------- ---------- ---------- Commitment and contingency (note 6) Stockholders' equity: Common stock, 100 shares issued and outstanding 1,000 1,000 1,000 Additional paid-in capital 282,000 282,000 282,000 Retained earnings 1,269,236 1,370,426 1,429,901 ---------- ---------- ---------- 1,552,236 1,653,426 1,712,901 ---------- ---------- ---------- $7,093,557 $8,321,424 $7,786,720 ========== ========== ========== The accompanying notes are an integral part of the financial statements.
8-K/A5th Page of 12TOC1stPreviousNextBottomJust 5th
L & J MARKETING, INC. D/B/A ALLIANCE DISTRIBUTORS STATEMENTS OF INCOME AND RETAINED EARNINGS For the years ended December 31, 1995 and 1996 and the nine months ended September 30, 1996 and 1997 (unaudited) [Enlarge/Download Table] December 31, September 30, -------------------------------- ------------------------------- 1995 1996 1996 1997 ------------ ------------ ------------ ------------ (unaudited) Net sales $ 25,117,915 $ 27,552,133 $ 15,588,521 $ 17,179,699 Cost of goods sold (note 7) 22,382,492 24,776,238 13,811,712 15,177,819 ------------ ------------ ------------ ------------ Gross profit 2,735,423 2,775,895 1,776,809 2,001,880 ------------ ------------ ------------ ------------ Operating expenses: Selling 961,168 1,346,824 817,420 978,349 General and administrative 1,231,180 1,083,523 746,384 731,761 Interest 138,185 233,558 149,125 203,942 ------------ ------------ ------------ ------------ 2,330,533 2,663,905 1,712,929 1,914,052 Income before provision for income taxes 404,890 111,990 63,880 87,828 Provision for income taxes 24,000 10,800 3,000 7,300 ------------ ------------ ------------ ------------ Net income 380,890 101,190 60,880 80,528 Retained earnings, beginning of period 1,034,346 1,269,236 1,269,236 1,370,426 Less distributions (146,000) -- -- (21,053) ------------ ------------ ------------ ------------ Retained earnings, end of period $ 1,269,236 $ 1,370,426 $ 1,330,116 $ 1,429,901 ============ ============ ============ ============ The accompanying notes are an integral part of the financial statements.
8-K/A6th Page of 12TOC1stPreviousNextBottomJust 6th
L & J MARKETING, INC. D/B/A ALLIANCE DISTRIBUTORS STATEMENTS OF CASH FLOWS For the years ended December 31, 1995 and 1996 and the nine months ended September 30, 1996 and 1997 (unaudited) [Enlarge/Download Table] December 31, September 30, ---------------------------- ---------------------------- 1995 1996 1996 1997 ----------- ----------- ----------- ----------- (unaudited) Cash flows from operating activities: Net income $ 380,890 $ 101,190 $ 60,880 $ 80,528 Adjustments to reconcile net income to net cash used by operating activities: Depreciation 34,354 33,455 23,750 18,275 Provision for loss on accounts receivable 13,276 18,782 -- 17,282 Gain on disposition of property and equipment (2,000) -- -- -- Changes in assets (increase) decrease: Accounts receivable 398,110 (1,292,592) (147,293) 291,354 Inventory (551,708) (37,773) (1,002,854) 200,189 Prepaid expenses 22,101 (7,151) (40,578) (2,034) Changes in liabilities increase (decrease): Accounts payable (889,853) (486,524) (2,036,303) (1,873,884) Accrued expenses 25,733 17,586 (8,233) (30,161) ----------- ----------- ----------- ----------- Net cash used by operating activities (569,097) (1,653,027) (3,150,631) (1,298,451) ----------- ----------- ----------- ----------- Cash flows from investing activities: Capital expenditures (49,649) (19,400) (13,007) (2,662) Proceeds from sale of truck 2,000 -- -- -- ----------- ----------- ----------- ----------- Net cash used by investing activities (47,649) (19,400) (13,007) (2,662) ----------- ----------- ----------- ----------- Cash flows from financing activities: Net borrowings on note and acceptances payable, bank 800,000 1,595,615 3,095,000 1,309,864 Distributions (146,000) -- -- (21,053) ----------- ----------- ----------- ----------- Net cash provided by financing activities 654,000 1,595,615 3,095,000 1,288,811 ----------- ----------- ----------- ----------- Net increase (decrease) in cash 37,254 (76,812) (68,638) (12,302) Cash, beginning of period 64,151 101,405 101,405 24,593 ----------- ----------- ----------- ----------- Cash, end of period $ 101,405 $ 24,593 $ 32,767 $ 12,291 =========== =========== =========== =========== Supplemental disclosures of cash flow information: Cash paid during the year for: Interest $ 133,150 $ 236,057 $ 149,125 $ 203,942 Income taxes -- 40,063 -- -- The accompanying notes are an integral part of the financial statements.
8-K/A7th Page of 12TOC1stPreviousNextBottomJust 7th
L & J MARKETING, INC. D/B/A ALLIANCE DISTRIBUTORS NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 1. Nature of business: The Company, located in New York, is a distributor of home entertainment and consumer electronic products. The Company grants credit primarily to retailers in the New York metropolitan area. 2. Significant accounting policies: a. Inventory: Inventory, consisting of finished goods, is stated at the lower of cost (first-in, first-out basis) or market. b. Property and equipment: Property and equipment are stated at cost and depreciation is computed by various methods over the estimated useful lives of the assets. c. Income taxes: The Company, with the consent of its stockholders, has elected to have its Federal and State income taxed as an S corporation, which provides that, in lieu of corporate income taxes, the stockholders are taxed on their proportionate share of the Company's taxable income. Therefore, no provision or liability for Federal income taxes is reflected in these financial statements. New York State and New Jersey impose a minimum tax on S corporations based upon the maximum personal rate and the differential it would have paid if it were a C corporation; accordingly, any material provision for state income taxes is reflected in the financial statements. Provision for New York City income taxes is based on statutory rates. d. Cash: The Company maintains its cash accounts in two commercial banks located in New York. The cash balances are insured by the Federal Deposit Insurance Corporation (FDIC) up to $100,000 at each bank. e. Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting year. Actual results could differ from those estimates. f. Advertising costs: Advertising costs are expensed as incurred. Advertising costs for the years ended December 31, 1996 and 1995 were approximately $92,000 and $106,000, respectively.
8-K/A8th Page of 12TOC1stPreviousNextBottomJust 8th
3. Property and equipment: 1996 1995 -------- -------- Auto and trucks $ 42,278 $ 42,278 Furniture and fixtures 90,258 87,481 Computer equipment 69,784 57,011 Leasehold improvements 53,652 49,802 -------- -------- 255,972 236,572 Less accumulated depreciation 150,423 116,968 -------- -------- $105,549 $119,604 ======== ======== 4. Note and acceptances payable, bank: The Company currently has available a $5,000,000 line of credit with a bank maturing June 30, 1997. Interest on direct borrowings is charged at 1% over prime. The Company has pledged, as collateral, all Company assets, as defined, in addition to personal guarantees of the stockholders. The line of credit agreement includes covenants which require the Company to maintain, among other things, certain working capital and net worth relationships. The Company is in compliance with all of the loan covenants as of December 31, 1996. 5. Pension plan: The Company has a profit-sharing plan which covers all employees who meet the eligibility requirements based on age and years of service. Contributions to the plan are made at the discretion of the Company's principals. For the years ended December 31, 1996 and 1995, pension expense was $0 and $34,810, respectively. 6. Commitment and contingency: a. The Company is obligated to make minimum rental payments under operating leases for showroom, office and warehouse space as follows: Years ending December 31, 1997 $ 96,000 1998 96,000 1999 96,000 2000 96,000 2001 56,000 The leases provide for payment of real estate taxes and other operating expenses. Rent and occupancy expense for the years ended December 31, 1996 and 1995 was approximately $96,000 and $102,000, respectively. b. The Company is contingently liable for a letter of credit for approximately $228,000 expiring April 30, 1997. 7. Major supplier: For the year ended December 31, 1996, the Company purchased approximately 24% of its merchandise from one supplier. Included in accounts payable at December 31, 1996 was approximately $1,439,000 due to this supplier. The Company purchased approximately 12% of its merchandise from a different supplier during 1995 and the amount due on these purchases was approximately $282,000 at December 31, 1995.
8-K/A9th Page of 12TOC1stPreviousNextBottomJust 9th
Unaudited Pro Forma Consolidated Financial Information The following unaudited pro forma consolidated statement of operations, for the year ended October 31, 1997, including the note thereto, give effect to the acquisitions of GameTek (UK) Limited ("GameTek"), Alternative Reality Technologies, Inc. ("ART"), Inventory Management Systems Inc. ("IMSI"), Creative Alliance Group, Inc. ("CAG"), and L & J Marketing, Inc. D/B/A Alliance Distributors ("Alliance"), by Take-Two Interactive Software, Inc. and subsidiaries (the "Company") as if the acquisitions had occurred as of November 1, 1996. On July 31, 1997, the Company acquired all the outstanding stock of IMSI and CAG. IMSI and CAG are engaged in the wholesale distribution of interactive software games. To effect the acquisition, all of the outstanding shares of common stock of each of IMSI and CAG were exchanged for 900,000 shares of restricted common stock of the Company. The acquisition has been accounted for as a pooling of interests in accordance with APB No. 16 and accordingly, the Company's financial statements for the year ended October 31, 1997, have been restated to include the results of operations of IMSI and CAG. All other acquisitions were accounted for under purchase accounting. As a result, the assets and liabilities of the acquired businesses are adjusted from their historical amount to their estimated fair value. Purchase accounting adjustments have been preliminarily estimated by the Company's management based upon available information and are believed by management to be reasonable. There can be no assurance, however, that the final purchase accounting adjustments that will ultimately be determined by the Company's management will not differ from these estimates. The unaudited pro forma consolidated statement of operations for the year ended October 31, 1997 has been prepared based on the audited historical consolidated statement of operations of the Company for the year ended October 31, 1997 which includes Take-Two, Mission, IMSI, CAG and GameTek/ART from July 29, 1997, the date of its acquisition; the unaudited historical statement of operations of GameTek for the period from November 1, 1996 to July 28, 1997; the historical statement of operations for ART, prior to its acquisition, is immaterial and has not been included in the unaudited pro forma consolidated statement of operations; and the unaudited historical statement of operations of Alliance for the period from October 1, 1996 to September 30, 1997. The unaudited pro forma consolidated financial information presented for informational purposes only, is not necessarily indicative of the actual results of operations of the Company that would have been reported if the acquisitions of GameTek, IMSI, CAG, and Alliance had occurred as of November 1, 1996, nor does such information purport to indicate results of future operations or financial condition. In the opinion of management, all adjustments necessary to present fairly such pro forma financial information have been made to the financial statements, and are reflected in the accompanying notes. The unaudited pro forma consolidated financial information should be read in conjunction with the Company's Annual Report on Form 10-KSB and with the financial statements included in this filing.
8-K/A10th Page of 12TOC1stPreviousNextBottomJust 10th
[Enlarge/Download Table] Historical Pro Forma -------------------------------------------- ------------------------------- Company(1) GameTek(2) Alliance(3) Adjustments As adjusted ------------ ------------ ------------ ------------ ------------ Net sales $ 19,014,083 $ 3,081,054 $ 29,143,311 $ (95,110)(4) $ 51,143,338 Cost of sales 12,459,189 3,727,094 26,142,345 (95,110)(4) 42,233,518 ------------ ------------ ------------ ------------ ------------ Gross profit 6,554,894 (646,040) 3,000,966 -- 8,909,820 Operating expenses: Research and development 1,248,258 -- -- 1,248,258 Selling and marketing 4,203,984 736,377 1,507,753 84,431(7) 6,532,545 General and administrative 3,385,481 2,539,249 1,040,920 6,965,650 Depreciation and amortization 844,221 58,627 27,980 283,024(5) 1,414,664 200,812(6) ------------ ------------ ------------ ------------ ------------ Total operating expenses 9,681,944 3,334,253 2,576,653 568,267 16,161,117 Income (loss) from operations (3,127,050) (3,980,293) 424,313 (568,267) (7,251,297) Interest and other expenses 1,016,612 43,772 288,375 30,000(8) 1,378,759 ------------ ------------ ------------ ------------ ------------ Income (loss) before income taxes (4,143,662) (4,024,065) 135,938 (598,267) (8,630,056) Provision for income taxes (benefit) 18,421 (247,610) 15,100 (214,089) ------------ ------------ ------------ ------------ ------------ Net income (loss) (4,162,083) (3,776,455) 120,838 (598,267) (8,415,967) Preferred dividends (135,416) -- -- (135,416) Distributions paid to S corporation shareholders prior to acquisition (202,092) -- -- (202,092) ------------ ------------ ------------ ------------ ------------ Net income (loss) attributable to common stockholders' $ (4,499,591) $ (3,776,455) $ 120,838 $ (598,267) $ (8,753,475) ============ ============ ============ ============ ============ Net loss per share $ (0.96) Weighted average shares (9) 9,141,029 outstanding
8-K/A11th Page of 12TOC1stPreviousNextBottomJust 11th
Notes to Unaudited Pro Forma Consolidated Financial Statements for the year ended October 31, 1997 (1) Reflects the Company's audited historical financial statements for the year ended October 31, 1997, which includes the operations of Take-Two, Mission, IMSI, CAG, and GameTek / ART from July 29, 1997, the date of its acquisition. (2) Reflects GameTek's unaudited historical financial statements for the period from November 1, 1996 to July 28, 1997. (3) Reflects Alliance's unaudited historical financial statements for the period from October 1, 1996 to September 30, 1997. (4) Reflects the elimination of inter-company transactions between IMSI and Alliance. (5) Reflects the adjustment of $283,024, which represents the amortization of the intangible assets acquired in connection with the GameTek acquisition. The acquired intangible asset is being amortized over the estimated useful life of 10 years. (6) Reflects the adjustment of $200,812, which represents the amortization of intangible assets acquired in connection with the Alliance acquisition. The acquired intangible asset is being amortized over the estimated useful life of 10 years. The cost of the acquisition was allocated to the assets acquired and liabilities assumed based upon their estimated fair values as follows: Working capital $ 1,010,007 Equipment 97,580 Intangibles 2,008,119 Deferred compensation 253,294 ----------- $ 3,369,000 =========== (7) Reflects the adjustment of $84,431, which represents the amortization of deferred compensation as a result of the issuance of non-qualified options to Alliance employees at an exercise price of $2.00 per share. The options vest over a period of three years. The difference between the exercise price and the fair value of the options at the measurement date is being amortized over the vesting period. (8) Reflects additional interest expense incurred in connection with the $500,000 promissory note, bearing interest at 8.0% per annum, issued in connection with the GameTek acquisition. (9) Reflects the Company's historical weighted average shares outstanding, plus 900,000 shares issued in connection with the acquisition of IMSI and CAG, plus 406,553 shares issued in connection with the acquisition of GameTek, plus 500,000 shares issued in connection with the acquisition of Alliance.
8-K/ALast Page of 12TOC1stPreviousNextBottomJust 12th
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. Dated: March 2, 1998 Take-Two Interactive Software, Inc. By:/s/ Ryan A. Brant --------------------------- Ryan A. Brant Chief Executive Officer

Dates Referenced Herein   and   Documents Incorporated by Reference

Referenced-On Page
This ‘8-K/A’ Filing    Date First  Last      Other Filings
Filed on:3/4/98
3/2/9812
12/31/978
For Period End:12/24/9728-K
10/31/9721110KSB,  8-K,  NT 10-K
9/30/97211
7/31/97910-Q
7/29/979118-K,  8-K/A
7/28/97911
6/30/978
4/30/97810QSB
2/19/973
12/31/9628
11/1/96911
10/1/96911
9/30/9626
12/31/9528
 List all Filings 
Top
Filing Submission 0000891554-98-000231   –   Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
AboutPrivacyRedactionsHelp — Tue., Apr. 16, 4:16:22.2pm ET