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| GEE > SEC Filings for GEE > Form 8-K on 8-Aug-2008 | All Recent SEC Filings |
8-Aug-2008
Entry into a Material Definitive Agreement, Financial Statements and Ex
On July 31, 2008 , Cragar Industries, Inc. (Seller), a wholly-owned subsidiary of Global Entertainment Corporation, entered into an asset purchase agreement with Danbom Temporary, Inc. (Buyer), an Iowa corporation, pursuant to which Buyer acquired substantially all of the assets, and assumed certain liabilities, of Cragar Industries, Inc. The transaction closed on August 1, 2008. The assets consisted primarily of intangibles, including trademarks, service marks and domain names. The purchase price was approximately $1.9 million in cash. Approximately $1.3 million of the cash has been set aside in a restricted account as security for a letter of credit issued by Global Entertainment Corporation's primary bank.
b) Pro Forma Financial Information
The text of Item 1.01 above is incorporated by reference into this Item 9.01. The following unaudited pro forma financial statements give effect to the discontinuance of operations of Cragar Industries, Inc. as if it occurred on May 31, 2006, with respect to the unaudited condensed pro forma consolidated statements of operations and the unaudited pro forma consolidated balance sheet.
The unaudited pro forma consolidated financial statements presented below are based on the assumptions and adjustments described in the accompanying notes and do not reflect any adjustments for non-recurring items or changes in operating strategies arising as a result of the disposition. The unaudited pro forma consolidated financial statements are presented for illustrative purposes and do not purport to represent what results of operations would have been if the events described above had occurred as of the dates indicated or what such results would be for any future periods. The unaudited pro forma consolidated financial statements and the accompanying notes should be read in conjunction with Global Entertainment Corporation's historical consolidated financial statements and related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in the Company's Annual Report on Form 10-KSB for the fiscal year ended as of May 31, 2007, and Quarterly Report on Form 10-QSB as of February 29, 2008.
Global Entertainment Corporation, Inc.
Unaudited Condensed Pro Forma Consolidated Balance Sheets
As of February 29, 2008
(in thousands, except per share amounts)
February 29, 2008
--------------------------------------
As Pro Forma Pro
Reported Adjustments Forma
-------- ----------- --------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 957 $ -- $ 957
Accounts receivable 3,474 (87) 3,387
Prepaid expenses and other assets 758 (131) 627
Income taxes receivable 138 -- 138
Deferred income tax asset 14 -- 14
-------- -------- --------
TOTAL CURRENT ASSETS 5,341 (218) 5,123
Property and equipment, net 177 (5) 172
Construction in progress 21,818 -- 21,818
Intangible assets, net 2,735 (2,733) 2
Goodwill 519 -- 519
Deferred income tax asset, net of valuation allowance 44 -- 44
Other assets 66 -- 66
-------- -------- --------
TOTAL ASSETS $ 30,700 $ (2,956) $ 27,744
======== ======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,285 $ (56) $ 2,229
Accrued liabilities 1,539 -- 1,539
Deferred revenues 393 (59) 334
Notes payable - current portion 511 -- 511
-------- -------- --------
TOTAL CURRENT LIABILITIES 4,728 (115) 4,613
Deferred income tax liability 66 -- 66
Long-term liabilities 4,699 -- 4,699
Notes payable - long-term portion 16,077 -- 16,077
-------- -------- --------
TOTAL LIABILITIES 25,570 (115) 25,455
-------- -------- --------
COMMITMENTS AND CONTINGENCIES
MINORITY INTERESTS 20 -- 20
STOCKHOLDERS' EQUITY:
Preferred stock - $.001 par value; 10,000 shares authorized;
no shares issued or outstanding -- -- --
Common stock - $.001 par value; 50,000 shares authorized;
6,625 shares issued and outstanding 7 -- 7
Paid-in capital 10,921 -- 10,921
Retained deficit (5,818) (2,841) (8,659)
-------- -------- --------
TOTAL STOCKHOLDERS' EQUITY 5,110 (2,841) 2,269
-------- -------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 30,700 $ (2,956) $ 27,744
======== ======== ========
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Global Entertainment Corporation, Inc.
Unaudited Condensed Pro Forma Consolidated Statements of Operations
For the Nine Months Ended February 29, 2008 and February 28, 2007
(in thousands, except per share amounts)
Nine Months Ended Nine Months Ended
February 29, 2008 February 28, 2007
-------------------------------------- --------------------------------------
As Pro Forma Pro As Pro Forma Pro
Reported Adjustments Forma Reported Adjustments Forma
-------- ----------- ----- -------- ----------- -----
Total Revenues $ 9,688 $ (602) $ 9,086 $ 22,139 $ (420) $ 21,719
-------- -------- -------- -------- -------- --------
Operating Costs
Cost of revenues 5,213 (351) 4,862 17,173 (118) 17,055
General and administrative costs 6,670 (475) 6,195 6,501 (830) 5,671
-------- -------- -------- -------- -------- --------
Total Operating Costs 11,883 (826) 11,057 23,674 (948) 22,726
-------- -------- -------- -------- -------- --------
Income (Loss) from Operations (2,195) 224 (1,971) (1,535) 528 (1,007)
Other Income (Expense)
Interest income 96 (7) 89 228 (38) 190
Interest expense (22) 1 (21) (12) 2 (10)
Minority interests (20) -- (20) 194 194
-------- -------- -------- -------- -------- --------
Total Other Income 54 (6) 48 410 (36) 374
-------- -------- -------- -------- -------- --------
Loss Before Income Taxes (2,141) 218 (1,923) (1,125) 492 (633)
Income Tax Benefit 107 -- 107 -- -- --
-------- -------- -------- -------- -------- --------
Net Loss $ (2,034) $ 218 $ (1,816) $ (1,125) $ 492 $ (633)
======== ======== ======== ======== ======== ========
Loss Per Share
-basic $ (0.31) $ (0.28) $ (0.17) $ (0.10)
======== ======== ======== ========
-diluted $ (0.31) $ (0.28) $ (0.17) $ (0.10)
======== ======== ======== ========
Weighted Average Shares Outstanding
-basic 6,518 6,518 6,501 6,501
======== ======== ======== ========
-diluted 6,518 6,518 6,501 6,501
======== ======== ======== ========
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Global Entertainment Corporation, Inc.
Unaudited Condensed Pro Forma Consolidated Statements of Operations
For the Year Ended May 31, 2007
(in thousands, except per share amounts)
Year Ended May 31, 2007
-------------------------------------------
As Pro Forma Pro
Reported Adjustments Forma
-------- ----------- -----
Total Revenues $ 26,450 $ (637) $ 25,813
-------- -------- --------
Operating Costs
Cost of revenues 20,175 (234) 19,941
General and administrative costs 9,696 (1,070) 8,626
Inangible asset impairment 906 (906) --
-------- -------- --------
Total Operating Costs 30,777 (2,210) 28,567
-------- -------- --------
Income (Loss) from Operations (4,327) 1,573 (2,754)
Other Income (Expense)
Interest income 294 (47) 247
Interest expense (14) 2 (12)
Minority interests (78) -- (78)
-------- -------- --------
Total Other Income 202 (45) 157
-------- -------- --------
Net Loss $ (4,125) $ 1,528 $ (2,597)
======== ======== ========
Loss Per Share
-basic $ (0.63) $ (0.40)
======== ========
-diluted $ (0.63) $ (0.40)
======== ========
Weighted Average Shares Outstanding
-basic 6,503 6,503
======== ========
-diluted 6,503 6,503
======== ========
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Global Entertainment Corporation Notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements
1. BASIS OF PRO FORMA PRESENTATION
These unaudited pro forma consolidated statements of operations for the year ended May 31, 2007, and the nine months ended February 29, 2008 and February 28, 2007, and unaudited pro forma consolidated balance sheets as of February 29, 2008, are based on the historical consolidated statements of operations and balance sheets, and give effect to the discontinuance of Cragar Industries, Inc. as if it had occurred at the beginning of the earliest period presented.
These unaudited pro forma consolidated financial statements are based on the assumptions and adjustments described in the accompanying notes and do not reflect any adjustments for non-recurring items or changes in operating strategies arising as a result of the disposition. The unaudited pro forma consolidated financial statements are presented for illustrative purposes and do not purport to represent what our results of operations actually would have been if the events described above had occurred as of the dates indicated or what such results would be for any future periods. The unaudited pro forma consolidated financial statements, and the accompanying notes, should be read in conjunction with the Global Entertainment Corporations's historical consolidated financial statements and the related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in the Company's Annual Report on Form 10-KSB for the fiscal year ended as of May 31, 2007, and Quarterly Report on Form 10-QSB for the period ended as of February 29, 2008.
2. PRO FORMA ADJUSTMENTS
Pro forma adjustments to the consolidated statements of operations reflect removal of Cragar Industries, Inc.-related income statement balances from reported amounts. Pro forma adjustments to the consolidated balance sheet reflect removal of Cragar Industries, Inc.-related balance sheet balances from reported amounts.
d) Exhibits
2.1 Asset Purchase Agreement dated July 31, 2008, between Danbom Temporary, Inc and Cragar Industries, Inc.
99.1 Press release dated August 1, 2008.
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