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 11, 2003
MEDIFAST, INC.
(Exact name of registrant as specified in its charter)
Delaware 000-23016 13-3714405
------------------------------- ---------------- -------------
(State or other jurisdiction (Commission File (IRS Employer
of incorporation or organization) Number) Ident. No.)
11445 Cronhill Drive, Owing Mills, Maryland 21117
------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (410)-581-8042
--------------------------------------------------------------------------------
(Former name or former address, if changed since last report.)
Item 5. Other Events
1) Effective June 11, 2003, Medifast, Inc.'s wholly-owned subsidiary Jason
Enterprises, Inc. ("Company") (AMEX:MED) completed the acquisition of the assets
of Consumer Choice Systems, Inc., a Delaware corporation, pursuant to the terms
of the agreement. The Company will obtain all the assets of the Consumer Choice
Systems Inc., business that support their retail and international business to
include the distribution rights in 18,000 retail food and drug stores.
The terms of the deal are as follows; Medifast, Inc. issued 76,120 shares
of Medifast, Inc. restricted common stock and 50,000 five-year warrants at a
purchase price of $10.00 per share. The transaction will be accounted for as an
asset purchase transaction. The Company is expecting to record limited and
selected liabilities that amount to approximately $1.35 million. The Company
intends to transfer these assets to the balance sheet of its wholly owned
subsidiary, Jason Enterprises, Inc. The assets and liabilities will be recorded
according to standard GAAP accounting principles. Consumer Choice Systems has an
annualized 12-month revenue of approximately 2 million dollars.
2) Mercantile Safe Deposit and Trust Company increased Medifast, Inc.'s secured
line of credit from $500,000 to $1 million to provide additional working capital
to Medifast, Inc. and its wholly owned subsidiaries.
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.
MEDIFAST, INC.
Dated: June 11, 2003
/s/ Bradley T. MacDonald
------------------------------------
Bradley T. MacDonald
Chairman and Chief Executive Officer
2
For Immediate Release
Contact: Medifast, Inc. (AMX:MED)
Casey Seward, Public & Investor Relations Specialist
410-504-8154
www.medifast.net
Medifast, Inc. Acquires Women's Wellbeing
Accretive Acquisition Expected to Increase Annual Revenues by $2 million
OWINGS MILLS, Md., June 12 /PRNewswire-FirstCall/ -- Medifast, Inc. (Amex:
MED) announced today that Jason Enterprises, Inc., a wholly owned subsidiary of
Medifast, acquired the assets of Consumer Choice Systems, Inc. (CCS) a Delaware
corporation. The purchase price was 76,120 restricted shares of Medifast's
restricted common stock and the issuance of 50,000 warrants to purchase
Medifast's common stock at $10.00 per share. Medifast also assumed $1.35 million
in CCS's liabilities. The acquisition is expected to be immediately accretive.
CCS assembles and distributes its products to over 18,000 chain food and drug
stores across the United States. Its Women's Wellbeing products focus on women
in the age group of 14 to 84, encompassing multiple product categories
including: 1) Urinary Tract Infection products that address detection, relief,
and prevention and 2) Menopause Relief products that address night sweats, hot
flashes and vaginal dryness. Additionally, Jason Enterprises will develop
cutting edge disease and condition management supplements and skin care products
under the Women's Wellbeing trademark. The newly acquired company has an
annualized 12-month revenue of approximately $2 million.
"We believe that the synergies between the two companies are compelling," says
Bradley MacDonald, CEO and Chairman of Medifast. "CCS has always been on the
leading edge of the women's health industry with advances in new products and
technologies developed to assist mature women under the Women's Wellbeing brand.
We believe we can become a leader in this category by combining our highly
successful marketing programs and distribution with their promising product
lines. The acquisition of CCS demonstrates our commitment to expanding our
business model to include an array of nutritional and health care products. The
Company will now be able to leverage its health network, advertising and
distribution programs to further enhance shareholder value. We are very excited
about this opportunity."
"We are excited about this opportunity to join the Medifast team which produces
the finest quality medical meal replacement products in the disease and weight
management industry," said Terry Kelley, the president of CCS. "Women's
Wellbeing and UTI branded products are a perfect complement to the Medifast
distribution system working with over 15,000 physicians across the country."
Additionally, in order to capitalize this new opportunity, Mercantile Safe
Deposit and Trust increased Medifast, Inc.'s secured line of credit from
$500,000 to $1,000,000.
This release contains forward-looking statements, which may involve known, and
unknown risks, uncertainties and other factors that may cause Medifast's actual
results and performance in future periods to be materially different from any
future results or performance suggested by these statements. Medifast cautions
investors not to place undue reliance on forward-looking statements, which speak
only to management's expectation on this date.