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): February 2, 2004
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E Com Ventures, Inc.
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(Exact name of registrant as specified in its charter)
Florida 0-19714 65-0977964
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(State of Incorporation) (Commission File Number) (IRS Employer
Identification No.)
251 International Parkway, Sunrise, FL 33325
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(Address of principal executive offices)
Registrant's telephone number, including area code: (954) 335-9100
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Item 1. Changes in Control of Registrant
On February 2, 2004, Ilia Lekach, IZJD Corp., Pacific Investment Group,
Inc. and Deborah Lekach (collectively, "Lekach"), entered into an Option
Agreement (the "Agreement"), with Stephen Nussdorf and Glenn Nussdorf (the
"Nussdorfs"), pursuant to which the Nussdorfs were granted options to acquire up
to an aggregate 720,954 shares of Common Stock of E Com Ventures, Inc. (the
"Issuer"), beneficially owned by Lekach (the "Shares"), for a purchase price of
$12.70 per Share in the installments indicated on or after the dates set forth
in the table below:
Date Number of Shares
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January 30, 2004 433,070
March 15, 2004 162,884
April 23, 2004 125,000
The purchase price for the Shares to be acquired by the Nussdorfs
under the Agreement is payable in cash; provided that the Nussdorfs may elect to
pay a portion of the purchase price for the Shares that are subject to the
option installment that first becomes exercisable in April 2004, by offsetting
the principal and accrued interest then owed under a $1,000,000 demand note,
dated December 8, 2003, made by Mr. Lekach and payable to the order of Stephen
Nussdorf.
On February 2, 2004, the Nussdorfs exercised the first option
installment pursuant to the Agreement to acquire 433,070 Shares: 298,530 Shares
by Stephen Nussdorf and 134,540 Shares by Glenn Nussdorf (the "Initial
Exercise"). The aggregate purchase price for the Initial Exercise will be
payable in cash. A portion of the aggregate purchase price payable under the
Initial Exercise will be deposited into escrow pursuant to an Escrow Agreement,
entered into on February 2, 2004, by and among Lekach, the Nussdorfs,
Perfumania, Inc., a wholly-owned subsidiary of the Issuer ("Perfumania"), and
Edwards & Angell, LLP, as escrow agent (the "Escrow Agreement").
Of the 720,954 Shares subject to the Agreement, up to an aggregate
443,750 shares are issuable upon exercise of certain stock options owned of
record by Ilia Lekach, including 125,000 options required to be issued to Mr.
Lekach pursuant to the terms of his employment agreement as a result of the
change of control. Said 125,000 options may only be issued upon approval of an
amendment to the Issuer's 2000 Stock Option Plan.
Assuming the Nussdorfs exercise the options under the Agreement and
acquire all of the 720,954 Shares, the Nussdorfs would own (based upon an
amendment to Schedule 13D, filed by the Nussdorfs), an aggregate 1,128,144
shares of the Issuer's Common Stock or approximately 39.21% of the total number
of shares of the Issuer currently outstanding.
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In addition, the Nussdorfs have agreed to make a $5,000,000 secured
demand loan to Perfumania, upon the acquisition of the 433,070 Shares pursuant
to the Initial Exercise. Such loan will be evidenced by a subordinated secured
demand note of Perfumania (the "Note"). The demand loan will be secured by a
security interest in Perfumania's assets pursuant to a Security Agreement, by
and among Perfumania and the Nussdorfs (the "Security Agreement"). The Note and
the Security Agreement will be executed by Perfumania and delivered to the
Nussdorfs prior to the funding of the demand loan. The Nussdorfs have deposited
$5,000,000 to fund the demand loan into escrow pursuant to the Escrow Agreement.
In addition, pursuant to and in accordance with the terms of the
Agreement, the Nussdorfs have been granted an irrevocable proxy for the term set
forth in the Agreement to vote any Shares owned by the Lekach Entities that are
the subject of the Agreement.
Effective as of January 30, 2004, Miles Raper, Donovan Chin and Daniel
Bengio resigned as members of the Issuer's Board of Directors, and effective
February 6, 2004, Stephen Nussdorf, Paul Garfinkle and Michael W. Katz were
elected to the Issuer's Board of Directors to fill such vacancies.
Item 7. Financial Statements and Exhibits
(c) Exhibits.
99.1 Option Agreement, by and among Ilia Lekach, IZJD Corp., Pacific
Investment Group, Inc., Deborah Lekach, Stephen Nussdorf and Glenn Nussdorf.
99.2. Escrow Agreement, by and among Ilia Lekach, IZJD Corp., Pacific
Investment Group, Inc., Deborah Lekach, Stephen Nussdorf, Glenn Nussdorf, and
Edwards & Angell, LLP.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized on this 10th day of February, 2004.
E COM VENTURES, INC.
By: /s/ A. Mark Young
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A. Mark Young
Chief Financial Officer
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