EX-99.2 4 dex992.htm UNAUDITED PRO FORMA FINANCIAL INFORMATION AS AT DECEMBER 31, 2003 Unaudited pro forma financial information as at December 31, 2003

EXHIBIT 99.2

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

The unaudited pro forma condensed consolidated balance sheet as of December 31, 2003 is presented to give effect to the acquisition of IXOS as if it occurred on December 31, 2003. As the acquisitions of Centrinity, Corechange, Eloquent and Gauss had been completed as of that date, the consolidated balance sheet of Open Text at December 31, 2003 already reflects those transactions. The unaudited pro forma condensed consolidated statement of operations of Open Text is presented as if the acquisitions of Centrinity, Corechange, Eloquent, Gauss and IXOS had taken place on July 1, 2003. As the acquisitions of Centrinity, Corechange and Eloquent had been completed as of July 1, 2003, the statement of operations of Open Text for the six-month period ended December 31, 2003 already reflects their results from operations. The unaudited pro forma condensed financial statements presented herein reflect the restated financial statements of IXOS for each of the periods presented.

The following unaudited pro forma condensed consolidated financial statements are based on the historical financial statements of Open Text, Centrinity, Corechange, Eloquent, Gauss and IXOS after giving effect to the acquisitions of Centrinity, Corechange, Eloquent, Gauss and IXOS, including the impact of restatements of IXOS, using the purchase method of accounting and the assumptions and adjustments described in the accompanying notes to the unaudited pro forma condensed consolidated financial statements. The acquisition of Centrinity was completed on November 1, 2002, the acquisition of Corechange was completed on February 25, 2003, the acquisition of Eloquent was completed on March 20, 2003 and the acquisition of Gauss was completed on October 16, 2003. The Company intends to acquire 100% of the common shares of IXOS and Gauss and the unaudited pro forma condensed consolidated financial statements are prepared on that basis. As of May 3, 2004, Open Text had acquired approximately 88% and 87% of the common shares of IXOS and Gauss, respectively. As of June 30, 2005 the Company had acquired approximately 94% (March 31, 2006 - 95%) of the common shares of IXOS. Certain information presented within the unaudited pro forma condensed consolidated financial statements has been presented as at June 30, 2005 to correspond to Open Text’s most recently filed audited annual financial statements filed on Form 10-K.

The unaudited pro forma condensed consolidated financial statements should be read in conjunction with the historical consolidated financial statements and accompanying notes contained in Open Text’s Annual Report on Form 10-K for its fiscal year ended June 30, 2003 and Quarterly Reports on Form 10-Q for its quarters ended September 30, 2003 and December 31, 2003 and with the restated financial statements contained herein for IXOS. The unaudited pro forma condensed consolidated financial statements are presented for illustrative purposes only and are not intended to represent or be indicative of the consolidated results of operations or financial condition of Open Text that would have been reported had the acquisitions been completed as of the dates presented, and should not be taken as representative of the future consolidated results of operations or financial condition of Open Text. The pro forma condensed consolidated statements of operations do not include any non-recurring charges or credits directly attributable to the acquisition.


Open Text Corporation

Unaudited Pro Forma Condensed Balance Sheet

As of December 31, 2003

(In thousands of US Dollars)

 

     Open Text    

IXOS (restated)

(1)

   

Pro Forma

Adjustments

    Pro Forma  
                 (Note 3)        

ASSETS

        

Current Assets

        

Cash and cash equivalents

   $ 65,421     $ 31,862     $ (66,875 )A   $ 30,408  

Accounts receivable, net of allowance

     39,942       51,103       —         91,045  

Income taxes recoverable

     5,127       —         —         5,127  

Unbilled Revenue

     —         2,129       —         2,129  

Prepaid expenses and other current

     4,368       6,280       —         10,648  

Deferred taxes

     5,866       —         27,986 G     33,852  
                                
     120,724       91,374       (38,889 )     173,209  

Restricted cash

     46,837       —         —         46,837  

Capital assets

     11,850       11,639       2,086 B     25,575  

Goodwill

     50,262       12,454       153,024 C     215,740  

Deferred taxes

     13,388       —         22,105 G     35,493  

Other assets

     35,411       2,059       —         37,470  

Intangible assets

     —         9,577       89,850 D     99,427  
                                

Total Assets

   $ 278,472     $ 127,103     $ 228,176     $ 633,751  
                                

LIABILITIES AND SHAREHOLDERS’ EQUITY

        

Current Liabilities

        

Accounts payable

   $ 42,032     $ 25,373     $ 46,873 F   $ 114,278  

Deferred revenue

     38,628       19,112       (2,278 )W     55,462  

Deferred taxes

     —         424       12,508 G     12,932  

Income taxes payable

     —         782       —         782  
                                
     80,660       45,691       57,103       183,454  
                                

Long Term Liabilities

        

Deferred revenue

     1,149       —         —         1,149  

Deferred taxes

     2,557       —         32,726 G     35,283  

Pension liability

     —         1,399       —         1,399  

Accrued liabilities

     4,944       —         —         4,944  
                                
     8,650       1,399       32,726       42,775  
                                

Minority interest

     —         —         2,633 E     2,633  

Shareholders Equity

        

Share capital

     217,810       28,051       162,856 H     408,717  

Additional paid in capital, less treasury shares

     —         67,889       (67,889 )I     —    

Paid in capital – stock warrants

     —         —         24,820 J     24,820  

Translation adjustment

     2,132       2,426       (2,426 )I     2,132  

Deficit

     (30,780 )     (18,353 )     18,353 I     (30,780 )
                                
     189,162       80,013       135,714       404,889  
                                
   $ 278,472     $ 127,103     $ 228,176     $ 633,751  
                                

(1) Euro converted to USD at rate of 1.2630, the exchange rate in effect at December 31, 2003

See accompanying notes to the pro forma condensed consolidated financial statements


Open Text Corporation

Unaudited Pro Forma Condensed Consolidated Statements of Operations

For the Twelve-Month Period Ended June 30, 2003

(In thousands of US Dollars, except per share data)

 

   

Open Text

Year ended

June 30,
2003

 

Centrinity

July 1, 2002

to Oct. 31,

2002 (1)

 

Corechange

July 1, 2002
to Feb. 24,

2003

 

Eloquent

July 1, 2002

to Mar. 19,

2003

 

Gauss 12

months ended

June 30,

2003 (2)

 

IXOS 12

months ended

June 30,

2003 (restated) (2)

 

IXOS Pro

Forma

Adjustments

   

Other Pro

Forma

Adjustments

   

Total Pro

Forma

Adjustments

    Pro Forma
                            (Note 3)     (Note 3)            

Revenues:

                   

License & networking

  $ 75,991   $ 2,000   $ 1,997   $ 847   $ 8,639   $ 51,427   —       $ (64 )K   $ (64 )   $ 140,837

Customer support

    63,091     1,853     1,757     254     11,779     43,242   —         —         —         121,976

Service

    38,643     418     1,058     671     4,645     37,647   —         —         —         83,082
                                                               

Total revenues

    177,725     4,271     4,812     1,772     25,063     132,316   —         (64 )     (64 )     345,895
                                                               

Cost of revenues:

                   

License & networking

    6,550     415     882     261     3,614     2,612   (49 )P     (128 )K     (177 )     14,157

Customer support

    10,406     386     87     195     3,352     30,397   139 P     —         139       44,962

Service

    28,241     85     1,059     436     785     11,253   (669 )P     —         (669 )     41,190
                                                               

Total cost of revenues

    45,197     886     2,028     892     7,751     44,262   (579 )     (128 )     (707 )     100,309
                                                               

Gross profit

    132,528     3,385     2,784     880     17,312     88,054   579       64       643       245,586
                                                               

Operating expenses:

                   

Research and development

    29,324     825     1,950     1,587     6,233     20,173   (1,805 )P     —         (1,805 )     58,287

Sales and marketing

    54,532     2,361     7,739     2,546     12,531     58,835   (2,359 )P     —         (2,359 )     136,185

General and administrative

    13,509     3,406     1,884     2,590     2,661     14,510   (317 )P     —         (317 )     38,243


Stock based compensation

     —        178       47       184       —         —         —         (409 )L     (409 )     —    

Restructuring charge

     —        —         457       1,205       —         —         —         —         —         1,662  

Other operating income

     —        —         —         —         —         (6,383 )     —         —         —         (6,383 )

Other operating expenses

     —        —         —         —         —         6,553       (560 )P     —         (560 )     5,993  

Depreciation

     5,009      702       539       313       1,946       —         5,016 Q     —         5,016       13,525  

Amortization of acquired intangible assets

     3,236      152       —         1,160       2,649       —         14,949 R     (653 )M     14,296       21,493  

Impairment of goodwill

     —        —         —         —         2,632       —         —         (2,632 )N     (2,632 )     —    

Total operating expenses

     105,610      7,624       12,616       9,585       28,652       93,688       14,924       (3,694 )     11,230       269,005  
                                                                               

Income (loss) from operations

     26,918      (4,239 )     (9,832 )     (8,705 )     (11,340 )     (5,634 )     (14,345 )     3,758       (10,587 )     (23,419 )
                                                                               

Other income (loss)

     2,733      314       (6,803 )     (1,821 )     (693 )     (4,819 )     —         2,611 O     2,611       (8,478 )

Interest income

     1,283      64       7       102       110       806       —         —         —         2,372  
                                                                               

Income (loss) before income taxes

     30,934      (3,861 )     (16,628 )     (10,424 )     (11,923 )     (9,647 )     (14,345 )     6,369       (7,976 )     (29,525 )

Provision for income taxes

     3,177      —         —         —         333       702       —         —         —         4,212  
                                                                               

Net income (loss) for the period

   $ 27,757    $ (3,861 )   $ (16,628 )   $ (10,424 )   $ (12,256 )   $ (10,349 )   $ (14,345 )   $ 6,369     $ (7,976 )   $ (33,737 )
                                                                               

Basic net income (loss) per share

   $ 0.71                    $ (0.70 )

Diluted net income (loss) per share

   $ 0.67                    $ (0.70 )

Weighted average number of Common Shares outstanding - basic *

     39,050                    *&       48,336  

Weighted average number of Common Shares outstanding - diluted *

     41,394                    *&       48,336  

* - adjusted for stock split October 8, 2003 & - adjusted for shares issued to acquire IXOS

                     

(1) Canadian Dollar converted to USD at rate of 0.6404, the average rate of the period.
(2) Euro converted to USD at rate of 1.0552, the average rate of the period.

See accompanying notes to the pro forma condensed consolidated financial statements


Open Text Corporation

Unaudited Pro Forma Condensed Consolidated Statements of Operations

For the Six-Month Period Ended December 31, 2003

(In thousands of US Dollars, except per share data)

 

     Open Text   

Gauss

July 1, 2003

to Oct. 15,

2003 (1)

   

IXOS July 1,

2003 to

December 31,

2003 (restated) (2)

   

IXOS Pro

Forma

Adjustments

   

Other Pro

Forma

Adjustments

    Pro Forma  
                      (Note 3)     (Note 3)        

Revenues:

             

License & networking

   $ 44,760    $ 1,098     $ 32,608     $ —       $ —       $ 78,466  

Customer support

     41,348      3,105       29,650       —         —         74,103  

Service

     19,751      1,058       23,252       —         —         44,061  
                                               

Total revenues

     105,859      5,261       85,510       —         —         196,630  
                                               

Cost of revenues:

             

License & networking

     3,841      1,071       1,637       (18 )S     —         6,531  

Customer support

     7,235      781       6,455       (190 )S     —         14,281  

Service

     16,329      183       18,144       (220 )S     —         34,436  
                                               

Total cost of revenues

     27,405      2,035       26,236       (428 )     —         55,248  
                                               

Gross profit

     78,454      3,226       59,274       428       —         141,382  
                                               

Operating expenses:

             

Research and development

     17,955      1,437       34,446       (1,941 )S     —         51,897  

Sales and marketing

     32,307      3,128       13,289       (811 )S     —         47,913  

General and administrative

     8,241      3,062       8,776       (343 )S     —         19,736  

Total stub period expense

     —        1,347       —         —         —         1,347  

Depreciation

     2,666      592       —         2,763 S     105 T     6,126  

Amortization of acquired intangible assets

     2,822      576       —         7,474 S/U     (10 )U     10,862  

Other operating income

     —        —         (3,689 )     —         —         (3,689 )

Other operating expenses

     —        —         3,682       (318 )S     —         3,364  
                                               

Total operating expenses

     63,991      10,142       56,504       6,824       95       137,556  
                                               

Income (loss) from operations

     14,463      (6,916 )     2,770       (6,396 )     (95 )     3,826  
                                               

Other income (loss)

     488      555       (212 )     —         (43 )V     788  

Interest income

     437      23       59       —         —         519  
                                               

Income (loss) before income taxes

     15,388      (6,338 )     2,617       (6,396 )     (138 )     5,133  

Provision for income taxes

     4,341      (348 )     112       —         —         4,105  
                                               

Net income (loss) for the period

   $ 11,047    $ (5,990 )   $ 2,505     $ (6,396 )   $ (138 )   $ 1,028  
                                               

Basic net income (loss) per share

   $ 0.28            $ 0.02  

Diluted net income (loss) per share

   $ 0.26            $ 0.02  

Weighted average number of Common Shares outstanding - basic

     39,947            * &     49,233  

Weighted average number of Common Shares outstanding - diluted

     42,872            * &     52,158  

* - adjusted for stock split October 8, 2003

             

* adjusted for shares issued to acquire IXOS

             

(1) Euro converted to USD at rate of 1.1299, the average rate of the period.
(2) Euro converted to USD at rate of 1.1691, the average rate of the period.

See accompanying notes to the pro forma condensed consolidated financial statements


Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

(in thousands of US Dollars)

Note 1: Basis of Presentation

The unaudited pro forma condensed consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission for the purposes of inclusion in Open Text’s amended Form 8-K/A prepared in connection with the acquisition of IXOS. These unaudited pro forma condensed consolidated financial statements give effect to the acquisitions of Centrinity, Corechange, Eloquent, Gauss and IXOS.

Certain information and certain footnote disclosure normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (GAAP) have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures provided herein are adequate to make the information presented not misleading.

The information concerning Open Text has been obtained from the audited consolidated financial statements of Open Text for the year ended June 30, 2003 and the unaudited consolidated financial statements for the six months ended December 31, 2003. The information concerning IXOS has been obtained from the audited restated consolidated financial statements of IXOS for the year ended June 30, 2003 and the unaudited restated consolidated financial statements for the six months ended December 31, 2003. The information concerning Gauss has been obtained from the audited consolidated financial statements of Gauss for the year ended December 31, 2002 and the nine months ended September 30, 2003 and the unaudited consolidated financial statements for the six months ended June 30, 2003 and 2002, the three months ended September 30, 2003 and for the period from October 1, 2003 to October 15, 2003, being the day immediately prior to the completion of the acquisition of Gauss by Open Text. The information concerning Eloquent has been obtained from the audited consolidated financial statements of Eloquent for the year ended December 31, 2002 and the unaudited consolidated financial statements for the six months ended December 31, 2002 and for the period from January 1, 2003 to March 19, 2003, being the day immediately prior to the completion of the acquisition of Eloquent by Open Text. The information concerning Corechange has been obtained from the audited consolidated financial statements of Corechange for the year ended December 31, 2002 and the unaudited consolidated financial statements for the six months ended December 31, 2002 and for the period from January 1, 2003 to February 24, 2003, being the day immediately prior to the completion of the acquisition of Corechange by Open Text. The information concerning Centrinity has been obtained from the audited consolidated financial statements for the year ended September 30, 2002 and unaudited consolidated financial statements for the three months ended September 30, 2002 and the unaudited consolidated financial statements for the four-month period ended October 31, 2002, being the day immediately prior to the acquisition date of Centrinity.

The unaudited pro forma condensed consolidated financial statements are provided for informational purposes only and do not purport to be indicative of the Company’s financial position or results of operations which would actually have been obtained had such transactions been completed as of the date or for the periods presented, or of the financial position or results of operations that may be obtained in the future.

Note 2: Purchase Price Allocation

On February 19, 2004, Open Text closed the Tender Offer, pursuant to which, 2016091 Ontario Inc., a wholly owned subsidiary of Open Text, acquired a total of 19,157,428 IXOS shares or approximately 88% of the ordinary share capital and voting rights of IXOS, including shares acquired in the open market. Of these IXOS shares, 17,792,529 shares (approximately 93% of the tendered shares) were tendered for the Alternative Consideration of Open Text shares and warrants, with the balance, including shares purchased on the open market, tendered for approximately $15 million in cash. The Alternative Consideration for each IXOS share consists of 0.5220 of an Open Text common share and 0.1484 of a warrant. Each whole warrant is exercisable to purchase one Open Text common share for up to one year after the closing date of the Tender Offer at a strike price of US $20.75 per share.

Approximately 9.3 million Open Text shares were issued in conjunction with the tender offer for IXOS. The shares were valued at the weighted average share price two days before and after the acquisition was announced. Accordingly, the fair value of the issued shares was approximately $191 million.

Approximately 2.6 million warrants were issued in conjunction with the Alternate Consideration. The fair value of each warrant was estimated using the Black-Scholes option-pricing model with the following weighted average assumptions:

 

Volatility

   60 %

Risk-free interest rate

   3.5 %

Dividend yield

   —    

Expected life

   1 year  


Based on this methodology, the warrants were valued at $9.40 each for a total value assigned of approximately $25 million.

Open Text intends to acquire 100% of the shares of IXOS and, accordingly, these pro forma financial statements are prepared on this basis. Between the closing date of the tender offer and June 30, 2005, Open Text acquired an additional 5,592,250 common shares of IXOS. As a result of the additional purchases up to June 30, 2005, 2016091 Ontario Inc. obtained a total of 24,749,678 IXOS shares or approximately 94% ownership of IXOS.

For the purpose of these pro forma financial statements, the purchase price of IXOS has been allocated to the assets acquired and liabilities assumed based on their fair values at the dates of acquisitions giving effect to the original tender offer and subsequent step acquisitions. For certain assets and liabilities, the book values at the balance sheet date have been determined to reflect fair values. The following table summarizes the components of the total purchase price of IXOS and the pro forma allocation:

 

Current assets (excluding cash acquired)

   $ 87,498  

Non-current assets

     37,889  

Intangible assets

     99,427  

Goodwill

     165,478  
        

Total assets acquired

     390,292  

Liabilities

     (136,919 )

Minority interest

     (2,633 )
        

Purchase price, net of cash acquired

   $ 250,740  
        

Note 3: Pro Forma Adjustments

The following adjustments have been reflected in the unaudited pro forma condensed consolidated financial statements:

 

  A. Represents, as of June 30, 2005, the cash consideration paid for IXOS by Open Text at the closing of the tender offer, additional cash consideration for the subsequent step acquisitions to acquire the shares of IXOS and usage of accruals set up for acquisition related costs.

 

  B. Represents the fair value adjustment to capital assets associated with IXOS acquisition.

 

  C. To record the new goodwill related to the acquisition of IXOS and to eliminate the historical goodwill of IXOS (see Note 2).

 

Elimination of IXOS historical goodwill

   $ (12,454 )

Goodwill from IXOS acquisition

     165,478  
        
   $ 153,024  
        

 

  D. To record the new intangible assets related to the acquisition of IXOS (see Note 2).

 

Customer intangibles from IXOS acquisition

   $ 37,500  

Core technology intangibles from IXOS acquisition

     20,757  

Application technology intangibles from IXOS acquisition

     41,170  
        
     99,427  

Less existing IXOS intangible assets

     (9,577 )
        
   $ 89,850  
        

 

  E. Minority interest assumed

 

  F. To record the Company’s severance and relocation costs related to certain IXOS employees, costs of vacating certain facilities and other direct costs associated with the transaction.

 

  G. To record deferred tax assets and deferred tax liabilities related to IXOS acquisition.

 

  H. To eliminate the share capital of IXOS and to record the shares issued by Open Text to acquire IXOS as follows:

 

Share capital of IXOS

   $ (28,051 )

Shares issued to acquire IXOS

     190,907  
        
   $ 162,856  
        


  I. To eliminate the additional paid in capital, translation adjustment and accumulated deficit of IXOS.

 

  J. To record the stock warrants issued associated with the acquisition of IXOS.

 

  K. To eliminate the revenues and expenses for hosting activities, as Open Text exited Centrinity’s hosting operations upon completion of that acquisition.

 

  L. To remove the stock-based compensation recorded in Centrinity, Eloquent, and Corechange as follows:

 

Centrinity

   $ 178

Corechange

     47

Eloquent

     184
      
   $ 409
      

As Open Text acquired the entire capital structure of Centrinity, Eloquent and Corechange as part of these acquisitions, Open Text incurs no such expenses post-acquisition.

 

  M. To adjust amortization relating to the identifiable intangible assets recorded at the time of the acquisition of Centrinity, Corechange, Eloquent, and Gauss and to reflect the elimination of Centrinity’s goodwill amortization and Eloquent’s, and Gauss’ intangible asset amortization as follows:

 

Amortization of acquired intangible assets relating to Centrinity acquisition

   $ 408  

Amortization of acquired intangible assets relating to Eloquent Acquisition

     332  

Amortization of acquired intangible assets relating to Corechange Acquisition

     628  

Amortization of acquired intangible assets relating to Gauss acquisition

     1,940  

Elimination of Eloquent’s historical intangible asset amortization

     (1,160 )

Elimination of Centrinity’s historical goodwill amortization

     (152 )

Elimination of Gauss’ historical intangible asset amortization

     (2,649 )
        
   $ (653 )
        

Based on the independent valuators reports, the Company has selected amortization periods of 5–7 years for various components of the acquired technology, as well as an amortization period of 3 years for customer contracts and 7 years for customer relationships.


  N. To eliminate Gauss’ goodwill impairment charge based upon the annual impairment test performed by Gauss.

 

  O. To remove the accretion and dividends on Corechange’s preferred stock and interest expense on Corechange’s warrants recorded by Corechange, the interest on Gauss’ convertible debt which was converted to common shares at the acquisition date and the minority interest recorded in Gauss’ statement of operations.

 

Elimination of Corechange’s dividends and interest

   $ 2,563  

Elimination of Gauss’ interest on convertible debt

     197  

Elimination of Gauss’ minority interest

     (149 )
        
   $ 2,611  
        

 

  P. To adjust IXOS presentation to conform to Open Text’s presentation.

 

Cost of revenue – license

   $ (49 )

Cost of revenue – service

     (669 )

Cost of revenue – customer support

     139  
        

Total

     (579 )
        

Sales and marketing expenses

     (2,359 )

Research and development

     (1,805 )

G&A

     (317 )

Other operating expenses

     (560 )

Depreciation

     4,807  

Amortization of acquired intangibles

     813  
        

Total

     579  
        

Net adjustment

     —    
        

 

  Q. To adjust the depreciation of capital assets associated with the IXOS acquisition.

 

Depreciation of capital asset adjustment

   $ 209

Reallocation of depreciation of existing capital assets (see note P)

     4,807
      
   $ 5,016
      

 

  R. To adjust amortization relating to the identifiable intangible assets recorded at the time of the acquisition of IXOS and to reflect the elimination of IXOS’ goodwill amortization as follows:

 

Elimination of IXOS historical intangible asset amortization

   $ (813 )

Amortization of acquired intangible assets relating to IXOS acquisition

     14,949  
        
     14,136  

Re-allocation of IXOS amortization to conform with Open Text’s reporting structure (see note P for adjustment)

     813  
        
   $ 14,949  
        


  S. To adjust IXOS presentation to conform to Open Text’s presentation:

 

Cost of revenue – license

   (18 )

Cost of revenue – service

   (220 )

Cost of revenue – customer support

   (190 )
      

Total cost of sales

   (428 )
      

Sales and marketing expenses

   (811 )

Research and development

   (1,941 )

G&A

   (343 )

Other operating expenses

   (318 )

Depreciation

   2,763  

Amortization of acquired intangibles

   1,078  
      

Total operating expenses

   428  
      

Net adjustment

   —    
      

 

  T. To adjust the depreciation related to the capital assets associated with the IXOS acquisition.

 

  U. To adjust amortization relating to the identifiable intangible assets recorded at the time of the acquisition of Gauss and IXOS and to reflect the elimination of Gauss’ and IXOS’ intangible asset amortization as follows:

 

Elimination of Gauss’ historical intangible asset amortization

   $ (576 )

Amortization of acquired intangible assets relating to Gauss acquisition

     566  
        
   $ (10 )
        

 

Elimination of IXOS’ historical intangible asset amortization

     (1,078 )

Amortization of acquired intangible assets relating to IXOS acquisition

     7,474  
        
   $ 6,396  
        

 

  V. To remove the interest on Gauss’ convertible debt, which was converted to common shares at the merger date and the minority interest recorded in Gauss’ statement of operations.

 

Elimination of Gauss’ interest on convertible debt

   $ 100  

Elimination of Gauss’ minority interest

     (143 )
        
   $ (43 )
        

 

W. To eliminate a portion of deferred revenue using a valuation based on estimated costs and appropriate profit margin to perform the services related to IXOS’ deferred maintenance contracts.


Note 4: Forward-Looking Statements

This document contains forward-looking statements that are based on a number of assumptions and estimates and that involve risks and uncertainties. All statements other than statements of historical fact are forward-looking statements. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, the actual results or performance of Open Text and its consolidated subsidiaries could differ materially from those expressed or implied by such forward-looking statements.

The risks, uncertainties and assumptions referred to above include the challenges of integration associated with the acquisitions or other planned acquisitions; the inability to achieve anticipated synergies; the costs associated with the acquisitions; the inability to maintain revenues on a combined company basis; employee management issues; the timely development, production and acceptance of products and services; the challenge of managing asset levels and expenses; and the other risks that are described from time to time in Open Text’s Securities and Exchange Commission reports, including but not limited to Open Text’s Annual Report on Form 10-K for the fiscal year ended June 30, 2005.

Open Text assumes no obligation and does not intend to update these forward-looking statements.