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):
June 30, 2015
Jamba,
Inc.
(Exact name of registrant as specified
in its charter)
Delaware |
|
001-32552 |
|
20-2122262 |
(State or other jurisdiction
of incorporation) |
|
(Commission
File No.) |
|
(I.R.S. Employer
Identification No.) |
6475 Christie Avenue, Suite 150, Emeryville,
California 94608
(Address of principal executive offices)
Registrant's telephone number, including
area code:
(510) 596-0100
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ |
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ |
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ |
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ |
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.01. Completion of Acquisition
or Disposition of Assets.
On June 30, 2015, the
Company completed the refranchising of a group of Company-owned stores located in Southern California as part of its
refranchising initiative. In connection with the refranchising transaction, the Company transferred to CMCS 2 Juice, LP and
CMCS 3 Juice, LP all machinery, equipment, computer hardware (including point of sale equipment), furniture, fixtures, tools,
signs, other tangible personal property, all marketable inventory and all goodwill associated with the stores for a purchase
price of $1,800,000 plus payment for cash on hand at each of the stores. Payment of the purchase price was comprised of
$540,000 in cash and two promissory notes of $542,079 and $717,921, both with an interest rate of four and
one-quarter percent (4.25%) per annum and maturity dates of July 30, 2015. CMCS 2 Juice, LP and CMCS 3 Juice, LP agreed to
enter into the Company’s standard franchise agreement with a ten-year term in connection with entering into the
transaction. The accompanying unaudited pro forma condensed consolidated financial statements give effect to the disposition
of the assets in the above referenced refranchising transaction as well as other store dispositions closed to date during the
current fiscal year.
Item 9.01. Financial Statements and
Exhibits
| (b) | Pro Forma Financial Information |
The unaudited pro forma condensed consolidated
financial statements of the Company, which reflect the disposition described in Item 2.01 and all other prior disposals under the
Company’s refranchising initiative, are furnished as Exhibit 99.1 to this Current Report on Form 8-K and are incorporated
by reference herein.
| 99.1 | Unaudited pro forma condensed consolidated financial statements of the Company. |
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 hereunto duly authorized.
|
JAMBA, INC. |
|
|
Date: July 7, 2015 |
By: |
/s/ Karen L. Luey |
|
|
Karen L. Luey
Chief Financial Officer, Chief Administrative Officer, Executive
Vice President and Secretary |
Exhibit 99.1
JAMBA INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share and per share amounts)
| |
| | |
PRO
FORMA ADJUSTMENTS | | |
| |
| |
Reported | | |
April Disposal | | |
April Disposal | | |
May | | |
June Disposal | | |
June Disposal | | |
Other | | |
Total | | |
Pro Forma | |
| |
December
30, 2014 | | |
1 | | |
2 | | |
Disposal | | |
1 | | |
2 | | |
Disposals | | |
Adjustments
| | |
December
30, 2014 | |
ASSETS | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Current assets: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Cash and cash equivalents | |
$ | 17,750 | | |
$ | 1,499 | | |
$ | 2,760 | | |
$ | 2,300 | | |
$ | 1,840 | | |
$ | 370 | | |
$ | 2,406 | | |
$ | 11,175 | (a) | |
$ | 28,925 | |
Receivables, net of allowances of
$280 and $291 | |
| 16,977 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| | | |
| - | | |
| | | |
| 18,237 | |
Inventories | |
| 2,300 | | |
| (83 | ) | |
| (48 | ) | |
| (56 | ) | |
| (67 | ) | |
| (42 | ) | |
| (32 | ) | |
| (328 | )(c) | |
| 1,972 | |
Prepaid and refundable income taxes | |
| 474 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 474 | |
Prepaid rent | |
| 504 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 504 | |
Assets held for sale | |
| 11,221 | | |
| (2,427 | ) | |
| - | | |
| (1,311 | ) | |
| - | | |
| | | |
| (191 | ) | |
| (3,929 | )(d) | |
| 7,292 | |
Prepaid expenses and other
current assets | |
| 8,105 | | |
| - | | |
| (95 | ) | |
| - | | |
| - | | |
| 1,260 | | |
| - | | |
| 1,165(b) | (c) | |
| 8,010 | |
Total current assets | |
| 57,331 | | |
| (1,011 | ) | |
| 2,617 | | |
| 933 | | |
| 1,773 | | |
| 1,588 | | |
| 2,184 | | |
| 8,084 | | |
| 65,415 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Property, fixtures and equipment, net | |
| 29,575 | | |
| - | | |
| (829 | ) | |
| - | | |
| (964 | ) | |
| (755 | ) | |
| (325 | ) | |
| (2,873 | )(d) | |
| 26,702 | |
Goodwill | |
| 982 | | |
| (7 | ) | |
| (11 | ) | |
| (9 | ) | |
| (8 | ) | |
| (6 | ) | |
| - | | |
| (41 | )(d) | |
| 941 | |
Trademarks and other intangible assets, net | |
| 2,360 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 2,360 | |
Other long-term assets | |
| 2,241 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 2,241 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total
assets | |
$ | 92,489 | | |
$ | (1,018 | ) | |
$ | 1,777 | | |
$ | 924 | | |
$ | 801 | | |
$ | 827 | | |
$ | 1,859 | | |
$ | 5,170 | | |
$ | 97,659 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Current liabilities: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Accounts payable | |
$ | 3,926 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 3,926 | |
Accrued compensation and benefits | |
| 6,325 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 6,325 | |
Workers' compensation and health insurance reserves | |
| 1,311 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 1,311 | |
Accrued jambacard liability | |
| 38,184 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 38,184 | |
Other current liabilities | |
| 16,454 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 16,454 | |
Total current liabilities | |
| 66,200 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 66,200 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Deferred revenue and other long-term liabilities | |
| 9,544 | | |
| 210 | | |
| - | | |
| 295 | | |
| - | | |
| - | | |
| - | | |
| 505 | (e) | |
| 10,049 | |
Total liabilities | |
| 75,744 | | |
| 210 | | |
| - | | |
| 295 | | |
| - | | |
| - | | |
| - | | |
| 505 | | |
| 76,249 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Stockholders' equity: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Common stock | |
$ | 17 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 17 | |
Additional paid-in-capital | |
| 396,629 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 396,629 | |
Treasury Shares at cost | |
| (11,991 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (11,991 | ) |
Accumulated deficit | |
| (368,041 | ) | |
| (1,228 | ) | |
| 1,908 | | |
| 629 | | |
| 801 | | |
| 827 | | |
| 1,859 | | |
| 4,796 | (f) | |
| (363,245 | ) |
Total equity attributable to Jamba, Inc. | |
| 16,614 | | |
| (1,228 | ) | |
| 1,908 | | |
| 629 | | |
| 801 | | |
| 827 | | |
| 1,859 | | |
| 4,796 | | |
| 21,410 | |
Noncontrolling interest | |
| 131 | | |
| - | | |
| (131 | ) | |
| - | | |
| | | |
| | | |
| - | | |
| (131 | )(g) | |
| - | |
Total stockholders' equity | |
| 16,745 | | |
| (1,228 | ) | |
| 1,777 | | |
| 629 | | |
| 801 | | |
| 827 | | |
| 1,859 | | |
| 4,665 | | |
| 21,410 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total
liabilities and stockholders' equity | |
$ | 92,489 | | |
$ | (1,018 | ) | |
$ | 1,777 | | |
$ | 924 | | |
$ | 801 | | |
$ | 827 | | |
$ | 1,859 | | |
$ | 5,170 | | |
$ | 97,659 | |
JAMBA INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(Dollars in thousands)
| |
| | |
PRO
FORMA ADJUSTMENTS | | |
| |
| |
Reported
Fiscal Year Ended
December 30, | | |
April Disposal
| | |
April Disposal
| | |
May | | |
June Disposal | | |
June Disposal | | |
Other | | |
Total | | |
Pro Forma
Fiscal Year Ended
December 30, | |
| |
2014 | | |
1 | | |
2 | | |
Disposal | | |
1 | | |
2 | | |
Disposals | | |
Adjustments | | |
2014 | |
Revenue: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Company Stores | |
$ | 198,737 | | |
$ | (9,563 | ) | |
$ | (6,551 | ) | |
$ | (7,219 | ) | |
$ | (6,543 | ) | |
$ | (6,039 | ) | |
$ | (3,996 | ) | |
$ | (39,911 | )A | |
$ | 158,826 | |
Franchise and other revenue | |
| 19,311 | | |
| 526 | | |
| 360 | | |
| 397 | | |
| 360 | | |
| 332 | | |
| 220 | | |
| 2,195 | B | |
| 21,506 | |
Total revenue | |
| 218,048 | | |
| (9,037 | ) | |
| (6,191 | ) | |
| (6,822 | ) | |
| (6,183 | ) | |
| (5,707 | ) | |
| (3,776 | ) | |
| (37,716 | ) | |
| 180,332 | |
Costs and operating expenses (income): | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Cost of sales | |
| 52,236 | | |
| (2,418 | ) | |
| (1,634 | ) | |
| (1,851 | ) | |
| (1,677 | ) | |
| (1,601 | ) | |
| (1,032 | ) | |
| (10,213 | )C | |
| 42,023 | |
Labor | |
| 61,749 | | |
| (3,164 | ) | |
| (1,808 | ) | |
| (2,198 | ) | |
| (2,002 | ) | |
| (1,871 | ) | |
| (1,157 | ) | |
| (12,200 | )C | |
| 49,549 | |
Occupancy | |
| 27,630 | | |
| (1,192 | ) | |
| (813 | ) | |
| (843 | ) | |
| (824 | ) | |
| (807 | ) | |
| (370 | ) | |
| (4,849 | )C | |
| 22,781 | |
Store operating | |
| 33,089 | | |
| (1,473 | ) | |
| (846 | ) | |
| (1,106 | ) | |
| (1,024 | ) | |
| (880 | ) | |
| (554 | ) | |
| (5,883 | )C | |
| 27,206 | |
Depreciation and amortization | |
| 10,084 | | |
| (501 | ) | |
| (149 | ) | |
| (323 | ) | |
| (279 | ) | |
| (201 | ) | |
| (91 | ) | |
| (1,544 | )C | |
| 8,540 | |
General and administrative | |
| 37,278 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 37,278 | |
Other operating, net | |
| (718 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (718 | ) |
Total costs and operating expenses | |
| 221,348 | | |
| (8,748 | ) | |
| (5,250 | ) | |
| (6,321 | ) | |
| (5,806 | ) | |
| (5,360 | ) | |
| (3,204 | ) | |
| (34,689 | ) | |
| 186,659 | |
Loss from operations | |
| (3,300 | ) | |
| (289 | ) | |
| (941 | ) | |
| (501 | ) | |
| (377 | ) | |
| (347 | ) | |
| (572 | ) | |
| (3,027 | ) | |
| (6,327 | ) |
Other income (expense): | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Interest income | |
| 74 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 74 | |
Interest expense | |
| (195 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (195 | ) |
Total other expense, net | |
| (121 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (121 | ) |
Loss before income taxes | |
| (3,421 | ) | |
| (289 | ) | |
| (941 | ) | |
| (501 | ) | |
| (377 | ) | |
| (347 | ) | |
| (572 | ) | |
| (3,027 | ) | |
| (6,448 | ) |
Income tax expense | |
| (168 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (168 | ) |
Net loss | |
| (3,589 | ) | |
| (289 | ) | |
| (941 | ) | |
| (501 | ) | |
| (377 | ) | |
| (347 | ) | |
| (572 | ) | |
| (3,027 | ) | |
| (6,616 | ) |
Less: Net income attributable to noncontrolling
interest | |
| 43 | | |
| - | | |
| (43 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| (43 | )D | |
| - | |
Net loss attributable to common stockholders | |
$ | (3,632 | ) | |
$ | (289 | ) | |
$ | (898 | ) | |
$ | (501 | ) | |
| (377 | ) | |
| (347 | ) | |
$ | (572 | ) | |
$ | (2,984 | ) | |
$ | (6,616 | ) |
Jamba, Inc.
Notes to Unaudited Pro Forma Condensed Consolidated Financial
Statements
December 30, 2014
| 1. | Description of Refranchising Transactions |
On April 28, 2015, Jamba Juice
Company, a California corporation and wholly-owned subsidiary of Jamba, Inc. (the “Company”) completed the refranchising
of a group of Company-owned stores located in the San Francisco Bay Area and Southern California as part of the Company’s
refranchising initiative in two separate transactions.
April Disposal 1
In connection with the first refranchising
transaction, the Company transferred to M5 Partners, Inc. all machinery, equipment, computer hardware (including point of sale
equipment), furniture, fixtures, tools, signs, vehicles, other tangible personal property and all goodwill associated with stores
for a purchase price of $1,850,000 plus payment for all marketable inventory and cash on hand at each of the stores. M5 Partners,
Inc. agreed to enter into the Company’s standard franchise agreement with a ten-year term in connection with entering into
the transaction.
April Disposal 2
In another refranchising transaction
completed on April 28, 2015, the Company sold its 88% membership interest in Jamba Juice Southern California LLC (“JJSC”)
to Strategic Marketing Sciences, Inc., its minority partner in the joint venture. JJSC was formed to operate a group of stores
in Southern California. The purchase price for the membership interest was $3,000,000 plus payment for all marketable inventory
and cash on hand at each of the stores. Strategic Marketing Sciences, Inc. agreed to enter into the Company’s standard franchise
agreement with a ten-year term in connection with entering into the transaction.
May Disposal
On May 19, 2015, the Company completed
the refranchising of a group of Company-owned stores located in the San Francisco Bay Area. In connection with the refranchising
transaction, the Company transferred to Blended Star NorCal, Inc. all machinery, equipment, computer hardware (including point
of sale equipment), furniture, fixtures, tools, signs, vehicles, other tangible personal property and all goodwill associated with
stores for a purchase price of $2,500,000 plus payment for all marketable inventory and cash on hand at each of the stores. Blended
Star NorCal, Inc. agreed to enter into the Company’s standard franchise agreement with a ten-year term in connection with
entering into the transaction.
June Disposal 1
On June 9, 2015, the Company completed
the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative. In
connection with the refranchising transaction, the Company transferred to J’s Juice Masters, Inc. all machinery, equipment,
computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property, all
marketable inventory and all goodwill associated with the stores for a purchase price of $2,100,000 plus payment for cash on hand
at each of the stores. J’s Juice Masters, Inc. agreed to enter into the Company’s standard franchise agreement with
a ten-year term in connection with entering into the transaction.
June Disposal 2
On June 30, 2015, the Company
completed the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative.
In connection with the refranchising transaction, the Company transferred to CMCS 2 Juice, LP and CMCS 3 Juice, LP all machinery,
equipment, computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property,
all marketable inventory and all goodwill associated with the stores for a purchase price of $1,800,000 plus payment for cash on
hand at each of the stores. Payment of the purchase price was comprised of $540,000 in cash and two promissory notes of $542,079
and $717,921, both with an interest rate of the rate of the four and one-quarter percent (4.25%) per annum and maturity dates of
July 30, 2015. CMCS 2 Juice, LP and CMCS 3 Juice, LP agreed to enter into the Company’s standard franchise agreement with
a ten-year term in connection with entering into the transaction.
Other Disposals
In addition to the transactions
mentioned above, the Company entered into multiple individually insignificant agreements and refranchised a small group of stores
located in Southern California and in the San Francisco Bay Area during the 13 week periods ended March 31, 2015 and June 30, 2015.
In connection with the refranchising transactions, the Company received aggregate proceeds of $2,412,000 and the purchasers entered
into the Company’s standard franchise agreements with ten-year terms in connection with entering into the transactions.
The effect of the refranchising
transactions on a cumulative basis is reflected in the unaudited pro forma condensed consolidated financial statements.
The unaudited pro forma condensed
consolidated financial statements were prepared in accordance with U.S. GAAP and pursuant to U.S. Securities and Exchange Commission
Regulation S-X Article 11, and present the pro forma financial position and results of operations of the Company based upon the
historical information after giving effect to the disposal and adjustments described in the notes to the unaudited pro forma condensed
consolidated financial statements. The unaudited pro forma condensed consolidated balance sheet is presented as if the refranchising
had occurred on December 30, 2014, and the unaudited pro forma condensed consolidated statement of operations for the fiscal year
ended December 30, 2014 is presented as if the disposal had occurred on January 1, 2014.
The unaudited pro forma condensed
consolidated financial information is presented for informational purposes only and is not indicative of the Company’s financial
results or financial position as if the transactions reflected herein had occurred, or been in effect during the pro forma periods.
This unaudited pro forma condensed consolidated financial information should not be viewed as indicative of the Company’s
expected financial results for future periods.
| 3. | Adjustments to Unaudited Pro Forma Condensed Consolidated Balance Sheet |
Adjustments in the columns titled “Pro Forma Adjustments”
represent the following:
(a) - Represents the pro forma adjustments
for the proceeds received offset by store-related cash balances at the end of the fiscal year (in thousands).
| |
Amount | |
Proceeds received | |
$ | 12,567 | |
Cost to sell | |
| (1,326 | ) |
Store-related cash at hand | |
| (66 | ) |
| |
$ | 11,175 | |
(b) - Represents the pro forma adjustments
for the one month promissory notes given as consideration included in the purchase price (in thousands):
| |
Amount | |
| |
| |
CMCS 2 Juice, LP | |
$ | 542 | |
CMCS 3 Juice, LP | |
| 718 | |
| |
$ | 1,260 | |
(c) - Represents the pro forma adjustments
for the assets that will no longer be on the Company’s balance sheet as a result of the disposal of the stores to franchise
partners.
(d) - Represents the pro forma adjustments
for the estimated net book value of the assets purchased by the franchise partners from the Company.
(e) - Represents the pro forma adjustments
for the effect of amounts refundable to purchasers contingent upon landlords not extending the lease terms for certain store locations.
(f) - Represents the pro forma adjustments for the
impact of the refranchising transaction on the Company’s accumulated deficit (in thousands):
| |
Amount | |
Proceeds received | |
$ | 12,567 | |
Promissory Notes | |
| 1,260 | |
Less: Cost to sell | |
| (1,326 | ) |
Assets held for sale | |
| (3,929 | ) |
Property, fixtures and equipment, net | |
| (2,873 | ) |
Goodwill and current assets | |
| (529 | ) |
Amounts contingently refundable | |
| (505 | ) |
Noncontrolling interest | |
| 131 | |
| |
$ | 4,796 | |
(g) - Represents the pro forma adjustment to eliminate
the 12% noncontrolling interest in JJSC, since the purchaser is acquiring the remaining interest on the JJSC stores.
| 4. | Adjustments to Unaudited Pro Forma Condensed Consolidated
Statement of Operations |
A - Reflects the pro forma adjustments for the revenue
during the fiscal year ended December 30, 2014 from the stores sold to franchise partners.
B - Reflects the pro forma adjustments for estimated
royalty income that would have been earned had the stores been owned by franchisees for the 2014 fiscal year.
C - Reflects the pro forma adjustments for the expenses
related to the stores sold to franchise partners.
D - Reflects the pro forma adjustments to eliminate
the 12% noncontrolling interest in JJSC, since the owner of the noncontrolling interest is acquiring the remaining interest on
the JJSC stores.
JAMBA INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share and per share amounts)
| |
| | |
PRO
FORMA ADJUSTMENTS | | |
| |
| |
Reported | | |
April Disposal | | |
April Disposal | | |
May | | |
June Disposal | | |
June Disposal | | |
Other | | |
Total | | |
Pro Forma | |
| |
March
31, 2015 | | |
1 | | |
2 | | |
Disposal | | |
1 | | |
2 | | |
Disposals | | |
Adjustments
| | |
March
31, 2015 | |
ASSETS | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Current assets: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Cash and cash equivalents | |
$ | 8,116 | | |
$ | 1,499 | | |
$ | 2,760 | | |
$ | 2,300 | | |
$ | 1,840 | | |
$ | 370 | | |
$ | 60 | | |
$ | 8,829 | (a) | |
| 16,945 | |
Receivables, net of allowances of
$272 and $280 | |
| 16,226 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| | | |
| - | | |
| | | |
| 17,486 | |
Inventories | |
| 2,267 | | |
| (90 | ) | |
| (44 | ) | |
| (63 | ) | |
| (62 | ) | |
| (48 | ) | |
| (7 | ) | |
| (314 | )(c) | |
| 1,953 | |
Prepaid and refundable income taxes | |
| 329 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 329 | |
Prepaid rent | |
| 2,931 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 2,931 | |
Assets held for sale | |
| 22,875 | | |
| (2,427 | ) | |
| (804 | ) | |
| (1,311 | ) | |
| (846 | ) | |
| (791 | ) | |
| - | | |
| (6,179 | )(d) | |
| 16,696 | |
Prepaid expenses and other
current assets | |
| 7,554 | | |
| - | | |
| (95 | ) | |
| - | | |
| - | | |
| 1,260 | | |
| - | | |
| 1,165(b) | (c) | |
| 7,459 | |
Total current assets | |
| 60,298 | | |
| (1,018 | ) | |
| 1,817 | | |
| 926 | | |
| 932 | | |
| 791 | | |
| 54 | | |
| 3,501 | | |
| 63,799 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Property, fixtures and equipment, net | |
| 16,002 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (114 | ) | |
| (114 | )(d) | |
| 15,888 | |
Goodwill | |
| 897 | | |
| (7 | ) | |
| (11 | ) | |
| (9 | ) | |
| (8 | ) | |
| (6 | ) | |
| - | | |
| (41 | )(d) | |
| 856 | |
Trademarks and other intangible assets, net | |
| 1,295 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 1,295 | |
Other long-term assets | |
| 1,969 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 1,969 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total
assets | |
$ | 80,461 | | |
$ | (1,025 | ) | |
$ | 1,806 | | |
$ | 917 | | |
$ | 924 | | |
$ | 784 | | |
$ | (60 | ) | |
$ | 3,346 | | |
$ | 83,807 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Current liabilities: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Accounts payable | |
$ | 2,310 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 2,310 | |
Accrued compensation and benefits | |
| 4,813 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 4,813 | |
Workers' compensation and health insurance reserves | |
| 1,680 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 1,680 | |
Accrued jambacard liability | |
| 32,368 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 32,368 | |
Other current liabilities | |
| 21,005 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 21,005 | |
Total current liabilities | |
| 62,176 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 62,176 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Deferred revenue and other long-term liabilities | |
| 8,643 | | |
| 210 | | |
| - | | |
| 295 | | |
| - | | |
| - | | |
| - | | |
| 505 | (e) | |
| 9,148 | |
Total liabilities | |
| 70,819 | | |
| 210 | | |
| - | | |
| 295 | | |
| - | | |
| - | | |
| - | | |
| 505 | | |
| 71,324 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Stockholders' equity: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Common stock | |
$ | 18 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | 18 | |
Additional paid-in-capital | |
| 397,928 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 397,928 | |
Treasury Shares at cost | |
| (18,674 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (18,674 | ) |
Accumulated deficit | |
| (369,792 | ) | |
| (1,235 | ) | |
| 1,968 | | |
| 622 | | |
| 924 | | |
| 784 | | |
| (60 | ) | |
| 3,003 | (f) | |
| (366,789 | ) |
Total equity attributable to Jamba, Inc. | |
| 9,480 | | |
| (1,235 | ) | |
| 1,968 | | |
| 622 | | |
| 924 | | |
| 784 | | |
| (60 | ) | |
| 3,003 | | |
| 12,483 | |
Noncontrolling interest | |
| 162 | | |
| - | | |
| (162 | ) | |
| - | | |
| - | | |
| | | |
| - | | |
| (162 | )(g) | |
| - | |
Total stockholders' equity | |
| 9,642 | | |
| (1,235 | ) | |
| 1,806 | | |
| 622 | | |
| 924 | | |
| 784 | | |
| (60 | ) | |
| 2,841 | | |
| 12,483 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total
liabilities and stockholders' equity | |
$ | 80,461 | | |
$ | (1,025 | ) | |
$ | 1,806 | | |
$ | 917 | | |
$ | 924 | | |
$ | 784 | | |
$ | (60 | ) | |
$ | 3,346 | | |
$ | 83,807 | |
JAMBA INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(Dollars in thousands)
| |
| | |
PRO
FORMA ADJUSTMENTS | | |
| |
| |
Reported
13 week period ended
March 31, | | |
April Disposal
| | |
April Disposal
| | |
May | | |
June Disposal | | |
June Disposal | | |
Other | | |
Total | | |
Pro Forma
13 week period ended
March 31, | |
| |
2015 | | |
1 | | |
2 | | |
Disposal | | |
1 | | |
2 | | |
Disposals | | |
Adjustments | | |
2015 | |
Revenue: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Company Stores | |
$ | 47,728 | | |
$ | (2,350 | ) | |
$ | (1,644 | ) | |
$ | (1,737 | ) | |
$ | (1,681 | ) | |
$ | (1,550 | ) | |
$ | (814 | ) | |
$ | (9,776 | )A | |
$ | 37,952 | |
Franchise and other revenue | |
| 4,776 | | |
| 129 | | |
| 90 | | |
| 96 | | |
| 92 | | |
| 85 | | |
| 45 | | |
| 538 | B | |
| 5,314 | |
Total revenue | |
| 52,504 | | |
| (2,221 | ) | |
| (1,554 | ) | |
| (1,641 | ) | |
| (1,589 | ) | |
| (1,465 | ) | |
| (769 | ) | |
| (9,239 | ) | |
| 43,265 | |
Costs and operating expenses (income): | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Cost of sales | |
| 12,407 | | |
| (585 | ) | |
| (428 | ) | |
| (428 | ) | |
| (431 | ) | |
| (412 | ) | |
| (216 | ) | |
| (2,500 | )C | |
| 9,907 | |
Labor | |
| 16,088 | | |
| (822 | ) | |
| (477 | ) | |
| (557 | ) | |
| (518 | ) | |
| (498 | ) | |
| (288 | ) | |
| (3,160 | )C | |
| 12,928 | |
Occupancy | |
| 6,835 | | |
| (301 | ) | |
| (207 | ) | |
| (222 | ) | |
| (211 | ) | |
| (213 | ) | |
| (58 | ) | |
| (1,212 | )C | |
| 5,623 | |
Store operating | |
| 8,034 | | |
| (376 | ) | |
| (224 | ) | |
| (244 | ) | |
| (239 | ) | |
| (216 | ) | |
| (76 | ) | |
| (1,375 | )C | |
| 6,659 | |
Depreciation and amortization | |
| 1,873 | | |
| (51 | ) | |
| (32 | ) | |
| (68 | ) | |
| (55 | ) | |
| (37 | ) | |
| (81 | ) | |
| (324 | )C | |
| 1,549 | |
General and administrative | |
| 8,963 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 8,963 | |
Other operating, net | |
| (28 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 1,924 | | |
| 1,924 | D | |
| 1,896 | |
Total costs and operating expenses | |
| 54,172 | | |
| (2,135 | ) | |
| (1,368 | ) | |
| (1,519 | ) | |
| (1,454 | ) | |
| (1,375 | ) | |
| 1,205 | | |
| (6,646 | ) | |
| 47,526 | |
Loss from operations | |
| (1,668 | ) | |
| (86 | ) | |
| (186 | ) | |
| (122 | ) | |
| (135 | ) | |
| (90 | ) | |
| (1,974 | ) | |
| (2,592 | ) | |
| (4,260 | ) |
Other income (expense): | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Interest income | |
| 15 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 15 | |
Interest expense | |
| (41 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (41 | ) |
Total other expense, net | |
| (26 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (26 | ) |
Loss before income taxes | |
| (1,694 | ) | |
| (86 | ) | |
| (186 | ) | |
| (122 | ) | |
| (135 | ) | |
| (90 | ) | |
| (1,974 | ) | |
| (2,592 | ) | |
| (4,286 | ) |
Income tax expense | |
| (26 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (26 | ) |
Net loss | |
| (1,720 | ) | |
| (86 | ) | |
| (186 | ) | |
| (122 | ) | |
| (135 | ) | |
| (90 | ) | |
| (1,974 | ) | |
| (2,592 | ) | |
| (4,312 | ) |
Less: Net income attributable to noncontrolling
interest | |
| 31 | | |
| - | | |
| (31 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| (31 | )E | |
| - | |
Net loss attributable to common stockholders | |
$ | (1,751 | ) | |
$ | (86 | ) | |
$ | (155 | ) | |
$ | (122 | ) | |
$ | (135 | ) | |
$ | (90 | ) | |
$ | (1,974 | ) | |
$ | (2,561 | ) | |
$ | (4,312 | ) |
Jamba, Inc.
Notes to Unaudited Pro Forma Condensed Consolidated Financial
Statements
March 31, 2015
| 1. | Description of Refranchising Transactions |
On April 28, 2015, Jamba Juice
Company, a California corporation and wholly-owned subsidiary of Jamba, Inc. (the “Company”) completed the refranchising
of a group of Company-owned stores located in the San Francisco Bay Area and Southern California as part of the Company’s
refranchising initiative in two separate transactions.
April Disposal 1
In connection with the first refranchising
transaction, the Company transferred to M5 Partners, Inc. all machinery, equipment, computer hardware (including point of sale
equipment), furniture, fixtures, tools, signs, vehicles, other tangible personal property and all goodwill associated with stores
for a purchase price of $1,850,000 plus payment for all marketable inventory and cash on hand at each of the stores. M5 Partners,
Inc. agreed to enter into the Company’s standard franchise agreement with a ten-year term in connection with entering into
the transaction.
April Disposal 2
In another refranchising transaction
completed on April 28, 2015, the Company sold its 88% membership interest in Jamba Juice Southern California LLC (“JJSC”)
to Strategic Marketing Sciences, Inc., its minority partner in the joint venture. JJSC was formed to operate a group of stores
in Southern California. The purchase price for the membership interest was $3,000,000 plus payment for all marketable inventory
and cash on hand at each of the stores. Strategic Marketing Sciences, Inc. agreed to enter into the Company’s standard franchise
agreement with a ten-year term in connection with entering into the transaction.
May Disposal
On May 19, 2015, the Company completed
the refranchising of a group of Company-owned stores located in the San Francisco Bay Area. In connection with the refranchising
transaction, the Company transferred to Blended Star NorCal, Inc. all machinery, equipment, computer hardware (including point
of sale equipment), furniture, fixtures, tools, signs, vehicles, other tangible personal property and all goodwill associated with
stores for a purchase price of $2,500,000 plus payment for all marketable inventory and cash on hand at each of the stores. Blended
Star NorCal, Inc. agreed to enter into the Company’s standard franchise agreement with a ten-year term in connection with
entering into the transaction.
June Disposal 1
On June 9, 2015, the Company completed
the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative. In
connection with the refranchising transaction, the Company transferred to J’s Juice Masters, Inc. all machinery, equipment,
computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property, all
marketable inventory and all goodwill associated with the stores for a purchase price of $2,100,000 plus payment for cash on hand
at each of the stores. J’s Juice Masters, Inc. agreed to enter into the Company’s standard franchise agreement with
a ten-year term in connection with entering into the transaction.
June Disposal 2
On June 30, 2015, the Company
completed the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative.
In connection with the refranchising transaction, the Company transferred to CMCS 2 Juice, LP and CMCS 3 Juice, LP all machinery,
equipment, computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property,
all marketable inventory and all goodwill associated with the stores for a purchase price of $1,800,000 plus payment for cash on
hand at each of the stores. Payment of the purchase price was comprised of $540,000 in cash and two promissory notes of $542,079
and $717,921, both with an interest rate of the rate of the four and one-quarter percent (4.25%) per annum and maturity dates of
July 30, 2015. CMCS 2 Juice, LP and CMCS 3 Juice, LP agreed to enter into the Company’s standard franchise agreement with
a ten-year term in connection with entering into the transaction.
Other Disposals
In addition to the transactions
mentioned above, the Company entered into multiple individually insignificant agreements and refranchised a small group of stores
located in Southern California and in the San Francisco Bay Area during the 13 week periods ended March 31, 2015 and June 30, 2015.
In connection with the refranchising transactions, the Company received aggregate proceeds of $2,412,000 and the purchasers entered
into the Company’s standard franchise agreements with ten-year terms in connection with entering into the transactions.
The unaudited pro forma condensed
consolidated financial statements were prepared in accordance with GAAP and pursuant to U.S. Securities and Exchange Commission
Regulation S-X Article 11, and present the pro forma financial position and results of operations of the Company based upon the
historical information after giving effect to the disposal and adjustments described in the notes to the unaudited pro forma condensed
consolidated financial statements. The unaudited pro forma condensed consolidated balance sheet is presented as if the refranchising
had occurred on March 31, 2015, and the unaudited pro forma condensed consolidated statement of operations for the 13 week period
ended March 31, 2015 is presented as if the disposal had occurred on January 1, 2014 and carried forward through the 13 week period
ended on March 31, 2015. As a result, pro forma adjustments for refranchising of the small group of stores completed during
the 13 week period ended March 31, 2015 were reflected in the unaudited pro forma condensed consolidated statement of operations
only.
The unaudited pro forma condensed
consolidated financial information is presented for informational purposes only and is not indicative of the Company’s financial
results or financial position as if the transactions reflected herein had occurred, or been in effect during the pro forma periods.
This unaudited pro forma condensed consolidated financial information should not be viewed as indicative of the Company’s
expected financial results for future periods.
| 3. | Adjustments to Unaudited Pro Forma Condensed Consolidated
Balance Sheet |
Adjustments in the columns titled “Pro Forma Adjustments”
represent the following:
(a) - Represents the pro forma adjustments
for the proceeds received offset by store-related cash balances at the end of the 13 week period ended March 31, 2015 (in thousands).
| |
Amount | |
Proceeds received | |
$ | 10,215 | |
Cost to sell | |
| (1,326 | ) |
Store-related cash at hand | |
| (60 | ) |
| |
$ | 8,829 | |
(b) - Represents the pro forma adjustments
for the one month promissory notes given as consideration included in the purchase price (in thousands):
| |
Amount | |
| |
| |
CMCS 2 Juice, LP | |
$ | 542 | |
CMCS 3 Juice, LP | |
| 718 | |
| |
$ | 1,260 | |
(c) - Represents the pro forma adjustments
for the assets that will no longer be on the Company’s balance sheet as a result of the disposal of the stores to franchise
partners.
(d) - Represents the pro forma adjustments for
the estimated net book value of the assets purchased by the franchise partners from the Company.
(e) - Represents the pro forma adjustments
for the effect of amounts refundable to purchasers contingent upon landlords not extending the lease terms for certain store locations.
(f) - Represents the pro forma adjustments
for the impact of the refranchising transaction on the Company’s accumulated deficit (in thousands):
| |
Amount | |
Proceeds received | |
$ | 10,215 | |
Promissory Notes | |
| 1,260 | |
Less: Cost to sell | |
| (1,326 | ) |
Assets held for sale | |
| (6,179 | ) |
Property, fixtures and equipment, net | |
| (114 | ) |
Goodwill and current assets | |
| (510 | ) |
Amounts contingently refundable | |
| (505 | ) |
Noncontrolling interest | |
| 162 | |
| |
$ | 3,003 | |
(g) - Represents the pro forma adjustment
to eliminate the 12% noncontrolling interest in JJSC, since the purchaser is acquiring the remaining interest on the JJSC stores.
Adjustments to Unaudited Pro Forma Condensed Consolidated
Statement of Operations
A - Reflects the pro forma adjustments for the revenue
during the 13 week period ended March 31, 2015 from the stores sold to franchise partners.
B - Reflects the pro forma adjustments for estimated
royalty income that would have been earned had the stores been owned by franchisees for the 13 week period ended March 31, 2015.
C - Reflects the pro forma adjustments for the expenses
related to the stores sold to franchise partners.
D - Reflects the pro forma adjustments to remove
the effect of the gain on refranchising the small group of stores during the 13 week period ended March 31, 2015.
E - Reflects the pro forma adjustments to eliminate
the 12% noncontrolling interest in JJSC, since the owner of the noncontrolling interest is acquiring the remaining interest on
the JJSC stores.
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