-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, THwEaDY/TbSR/N1cXwkikOJv6DLHpdyzXLnJjdDiHBARUtbNeFc204ob7RWNSteU K2s8OgUkTd2bT/s8Xn7aQg== 0000950168-96-001513.txt : 19960816 0000950168-96-001513.hdr.sgml : 19960816 ACCESSION NUMBER: 0000950168-96-001513 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960531 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19960814 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MEDIC COMPUTER SYSTEMS INC CENTRAL INDEX KEY: 0000885378 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 561306083 STATE OF INCORPORATION: NC FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-20183 FILM NUMBER: 96613004 BUSINESS ADDRESS: STREET 1: 8601 SIX FORKS ROAD STE 300 CITY: RALEIGH STATE: NC ZIP: 27615 BUSINESS PHONE: 9198478102 8-K/A 1 MEDIC COMPUTER SYSTEMS, INC. FORM 8-K/A SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A Amendment No. 1 CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) May 31, 1996 MEDIC COMPUTER SYSTEMS, INC. (Exact name of registrant as specified in its charter) North Carolina (State or other jurisdiction of incorporation) 0-20183 56-1306083 (Commission file Number) (IRS Employer ID Number) 8601 Six Forks Road, Raleigh, North Carolina 27615 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 919/ 847-8102 N/A (Former name or former address, if changed since last report) Item 7. Financial Statements and Exhibits. (a) Financial Statements of Business Acquired. As required by Item 7 of Form 8-K promulgated by the Securities and Exchange Commission (the "Commission") under the Securities Exchange Act of 1934, as amended (the "Act"), the following financial statements of the business acquired are filed with this report:
Page Number Report of Independent Public Accountants.............................................F-2 Combined Balance Sheet as of December 31, 1995.................................................................................F-3 Combined Statement of Income for the Year Ended December 31, 1995.........................................................F-4 Combined Statement of Changes in Shareholders' Equity for the Year Ended December 31, 1995....................................................................F-5 Combined Statement of Cash Flows for the Year Ended December 31, 1995.........................................................F-6 Notes to Combined Financial Statements...............................................F-7 (b) Pro Forma Financial Information. As required by Item 7 of Form 8-K promulgated by the Commission under the Act, the following pro forma financial information is filed with this report: Page Number CompuSystems, Inc. Unaudited Combined Balance Sheet as of March 31, 1996..................................................F-12 CompuSystems, Inc. Unaudited Combined Statement of Operations for the Period Ended March 31, 1996................................................................F-13 Medic Computer Systems, Inc. Unaudited Pro Forma Consolidated Balance Sheets as of June 30, 1996 and December 31, 1995 ..........................................F-15 Medic Computer Systems, Inc. Unaudited Pro Forma Consolidated Statements of Operations For the Years Ended December 31, 1995 and 1994............................................................................F-16 2 Page Number Medic Computer Systems, Inc. Unaudited Pro Forma Consolidated Statements of Operations For the Six Months Ended June 30, 1996 and 1995................................................................................F-17
(c) Exhibits. 2.6* Agreement of Merger dated as of May 31, 1996, by and among the Registrant, CompuSystems Acquisition Corporation, CompuSystems, Inc., Nexsen B. Johnson, Eugene F. Gallogly and Sylvia Johnson. 3.5, 4.6* Articles of Merger of CompuSystems Acquisition Corporation into CompuSystems, Inc. 23.1.1 Consent of Arthur Andersen LLP - ------------------- *Previously filed. 3 CompuSystems, Inc. Combined Financial Statements as of December 31, 1995 Together with Report of Independent Public Accountants F-1 Report of Independent Public Accountants To the Stockholders of CompuSystems, Inc.: We have audited the accompanying combined balance sheet of CompuSystems, Inc. (Note 1) (a South Carolina corporation) as of December 31, 1995, and the related combined statements of income, changes in stockholders' equity and cash flows for the year ended December 31, 1995. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the combined financial statements referred to above present fairly, in all material respects, the financial position of CompuSystems, Inc. (Note 1) as of December 31, 1995, and the results of its operations and its cash flows for the year ended December 31, 1995, in conformity with generally accepted accounting principles. /s/ Arthur Andersen LLP Columbia, South Carolina, July 29, 1996. F-2 CompuSystems, Inc. (Note 1) Combined Balance Sheet December 31, 1995 Assets Current assets: Cash and cash equivalents $1,474,493 Accounts receivable, net 1,540,891 Inventories 1,162,685 Prepaid expenses and other 20,140 Total current assets 4,198,209 Property and equipment, net 2,044,427 Other assets 153,556 $6,396,192 Liabilities and Stockholders' Equity Current liabilities: Accounts payable, trade $ 118,807 Accrued liabilities 296,366 Deferred maintenance revenue 1,236,838 Current portion of long-term debt 1,258,149 Total current liabilities 2,910,160 Long-term debt, less current portion 32,887 Stockholders' equity: Common stock, $1 par value, 100,000 shares authorized, 40,000 shares issued and outstanding 40,000 Additional paid-in capital 170,836 Retained earnings 3,242,309 Total stockholders' equity 3,453,145 $6,396,192 The accompanying notes to combined financial statements are an integral part of this balance sheet. F-3 CompuSystems, Inc. (Note 1) Combined Statement of Income For the Year Ended December 31, 1995 Net sales $10,327,153 Cost of sales 2,813,303 Gross profit 7,513,850 Operating expenses: General and administrative expenses 4,202,135 Depreciation and amortization 295,954 Total operating expenses 4,498,089 Income from operations 3,015,761 Other income (expense): Interest income 131,989 Interest expense (107,463) Loss on sale of marketable securities (83,110) Other, net (5,996) Net income $ 2,951,181 The accompanying notes to combined financial statements are an integral part of this balance sheet. F-4 CompuSystems, Inc. (Note 1) Combined Statement of Changes in Stockholders' Equity For the Year Ended December 31, 1995 Unrealized Common Paid-in Retained Holding Stock Capital Earnings Loss Total Balance, December 31, 1994 $40,000 $170,836 $3,678,229 $(75,859) $3,813,206 Net income 0 0 2,951,181 0 2,951,181 Distribution to stockholders 0 0 (3,387,101) 0 (3,387,101) Reduction in unrealized holding loss on marketable securities 0 0 0 75,859 75,859 Balance, December 31, 1995 $40,000 $170,836 $3,242,309 $ 0 $3,453,145 The accompanying notes to combined financial statements are an integral part of this balance sheet. F-5 CompuSystems, Inc. (Note 1) Combined Statement of Cash Flows For the Year Ended December 31, 1995 Cash flows from operating activities: Net income $2,951,181 Adjustments to reconcile net income to net cash provided by operating activities- Depreciation and amortization 295,954 Loss on sale of marketable securities 83,110 Provision for doubtful accounts 64,315 Changes in operating assets and liabilities: Increase in accounts receivable, net (378,736) Increase in inventories (192,721) Increase in prepaid expenses and other (14,673) Increase in other assets (26,927) Increase in accounts payable, trade 80,603 Increase in accrued liabilities 135,571 Increase in deferred maintenance revenue 132,234 Net cash provided by operating activities 3,129,911 Cash flows from investing activities: Purchases of property and equipment, net (253,851) Purchases of software rights (3,000) Purchases of marketable securities (49,762) Sale of marketable securities 84,283 Net cash used in investing activities (222,330) Cash flows from financing activities: Payments on long-term debt (163,624) Proceeds from long-term debt 35,454 Distributions to stockholders (3,387,101) Net cash used in financing activities (3,515,271) Net decrease in cash and cash equivalents (607,690) Cash and cash equivalents, beginning of period 2,082,183 Cash and cash equivalents, end of period $1,474,493 Supplemental disclosure - Cash paid for interest $ 107,463 The accompanying notes to combined financial statements are an integral part of this balance sheet. F-6 CompuSystems, Inc. (Note 1) Notes to Combined Financial Statements December 31, 1995 1. Organization: The combined statements of CompuSystems, Inc. represent the accounts of CompuSystems, Inc. (the Company) and a building occupied and leased by the Company and owned by the majority stockholder. All transactions between the Company and the majority stockholder related to the building lease have been eliminated in combination. The Company was incorporated on June 30, 1980, under the laws of the state of South Carolina. The Company manufactures computer systems and installs administrative medical support software for physicians' offices primarily in four Southeastern states: North Carolina, South Carolina, Georgia and Florida. The Company also provides maintenance service for its installations as part of its core business. 2. Summary of Significant Accounting Policies: Revenue Recognition The Company recognizes revenue on software license sales in accordance with the provisions of AICPA Statement of Position 91-1, "Software Revenue Recognition." The Company's products are sold with 90 days of technical support services included as part of the sale. Revenue from systems sales are recognized upon the installation and testing of the system. Costs of remaining insignificant company obligations, if any, are accrued as cost of revenues at the time of revenue recognition. Revenues related to hardware and software maintenance contracts are recognized ratably over the terms of the contracts, generally one year. The cost of revenues consists primarily of the costs of hardware components purchased from outside vendors. Deferred maintenance revenue consists of the amount collected from customers for maintenance contracts which cover future periods. Cash and Cash Equivalents Cash and cash equivalents include cash in banks and all highly liquid investments with original maturities of three months or less. Inventory Inventories are valued using the first-in, first-out (FIFO) method of inventory costing and are stated at the lower of cost (FIFO) or market. Inventories consist principally of computer hardware held for resale and computer maintenance parts. F-7 Ending inventories consisted of the following: New and used computer hardware and parts $1,100,676 Inventory shipped to customers for which revenue recognition criteria has not been met 9,807 Computer forms 52,202 $1,162,685 Property and Equipment Property and equipment are stated at cost. Expenditures for repairs and maintenance are charged to expense as incurred. Depreciation is computed using the straight-line method based on the estimated useful lives of five to 31.5 years. A summary of property and equipment at December 31, 1995, is as follows: 1995 Useful Lives Equipment $ 677,465 5 to 7 years Furniture and fixtures 358,450 5 to 7 years Vehicles 264,459 5 years Building and improvements 1,750,524 31.5 years 3,050,898 Less - Accumulated depreciation and amortization (1,006,471) Total property and equipment, net $2,044,427 At December 31, 1995, the building, which is owned by the majority stockholder, had a net book value of $1,323,985 and related debt outstanding of $1,201,377. Income Taxes The Company has elected to be taxed as an S Corporation. As an S Corporation, the stockholders of the Company are required to include their proportionate share of the Company's taxable income on their individual tax returns. The Company periodically distributes to the stockholders amounts that represent the estimated increased tax liability of the stockholders associated with their proportionate share of the Company's taxable income. Accordingly, no tax provision has been recorded for the year ended December 31, 1995. F-8 Marketable Securities Effective January 1, 1994, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 115, "Accounting for Certain Investments in Debt and Equity Securities." SFAS No. 115 requires that all securities be classified according to the Company's investment strategy. Based on this strategy, the Company classified all of its marketable securities as available-for-sale during 1994. In accordance with SFAS No. 115, marketable securities were carried at the lower of aggregate quoted market value or cost. Unrealized holding losses on noncurrent marketable equity securities were accumulated in the unrealized holding loss component of stockholders' equity. Realized gains or losses in 1995 were computed based on specific identification of the securities sold. During 1995, the Company sold all of its marketable securities, resulting in the elimination of the unrealized holding loss component of stockholders' equity. Product Development Product development costs, including software development costs, are charged to expense the year incurred. Other Assets Other assets consist primarily of capitalized costs related to software rights purchased from outside sources. These costs are being amortized on a straight-line basis over three years, which is the estimated useful life of the rights. Fair Value of Financial Instruments Effective January 1, 1995, the Company adopted the provision of SFAS No. 107, "Disclosures About Fair Value of Financial Instruments." The following methods and assumptions were used by the Company's management in estimating fair values for financial instruments as required by SFAS No. 107: Investments - The fair values of the Company's investments are based on market quotations. Long-term Note - Management believes that the Company's long-term note is at fair value Pervasiveness of Estimates The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. F-9 3. Concentration of Credit Risk: The Company manufactures and installs medical support systems and provides technical support for medical agencies and physician's offices in the Southeast. The Company performs periodic credit evaluations of its customers' financial conditions and establishes an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information. The Company has no significant exposure to any individual customer. However, the Company sells products and provides services primarily to physicians' practices located in the southeastern United States. Substantially all of the Company's accounts receivable are due from customers in the above lines of business. Receivables are generally due within 30 days. Accounts receivable are reflected net of a reserve for doubtful accounts of $100,000 at December 31, 1995. 4. Debt: The Company's long-term debt consisted of the following at December 31, 1995: Note payable to a bank, monthly payments of $13,968, interest at 7.3%, secured by a building $1,201,377 Note payable to a bank, due in 36 monthly payments of $3,126, beginning September 1993, interest at 6%, secured by six vans 24,609 Note payable to a bank, due in 36 monthly payments of $1,554, beginning June 1994, interest at 7%, secured by three automobiles 23,739 Note payable to a bank, due in 36 monthly payments of $499, beginning June 1994, interest at 9.5%, secured by an automobile 7,581 Note payable to a bank, due in monthly payments of $1,132, beginning November 1995, interest at 9.25%, secured by two vans 33,730 1,291,036 Less - Current maturities 1,258,149 Long-term debt $ 32,887 Future principal maturities of long-term debt are as follows at December 31, 1995: 1996 $1,258,149 1997 22,038 1998 10,849 F-10 5. Benefit Plan: In 1989, the Company established the CompuSystems, Inc. 401(k) Plan (the Plan), covering all employees who meet the service period and age requirement as defined in the Plan. The Company matches employee contributions based on a discretionary matching percentage as determined by the Plan's trustees. In 1995, the Company matched 3% of employee compensation contributed to the Plan. These matching contributions totaled approximately $63,000 for the year ended December 31, 1995. Although additional contributions to the Plan may be made at the discretion of the Company, no additional contributions were made to the Plan for the year ended December 31, 1995. 6. Subsequent Event: On May 31, 1996, the Company entered into an Agreement of Merger with Medic Computer Systems, Inc. (Medic), a North Carolina corporation. As of May 31, 1996, each of the 40,000 shares of the Company's common stock, $1.00 par value per share, was converted into the right to receive shares of the common stock, $.01 par value per share, of Medic. Additionally, each share of the Company's common stock was converted into the right to receive 8.680555 shares of Medic common stock. An aggregate of 347,221 shares of Medic common stock were issued to the stockholders of the Company. Medic also acquired the land and building in which the Company conducts its business for which the owners of the building received an aggregate of 12,222 shares of Medic common stock, subject to adjustment upon completion of an appraisal and survey of the property. F-11 COMPUSYSTEMS, INC. UNAUDITED COMBINED BALANCE SHEET AS OF MARCH 31, 1996 (DOLLARS IN THOUSANDS)
ASSETS CURRENT ASSETS: Cash and cash equivalents $1,558 Accounts receivable, trade, net 1,478 Inventories and maintenance parts 1,298 Prepaid expenses 150 - --------------------------------------------------------------------------------------------------- TOTAL CURRENT ASSETS 4,484 Property and equipment, at cost, net 2,067 - --------------------------------------------------------------------------------------------------- TOTAL ASSETS $6,551 - --------------------------------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of long-term note $1,259 Accounts payable, trade 113 Customer deposits and deferred maintenance revenue 1,196 Accrued expenses: Commissions 49 Compensation and related items 166 Other 11 - --------------------------------------------------------------------------------------------------- TOTAL CURRENT LIABILITIES 2,794 Long-term note, less current portion 16 - --------------------------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY: Common Stock, $1.00 par value; 100,000 shares authorized; 40,000 issued and outstanding in 1996 40 Additional paid-in capital 171 Retained earnings 3,530 - --------------------------------------------------------------------------------------------------- 3,741 - --------------------------------------------------------------------------------------------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $6,551 - ---------------------------------------------------------------------------------------------------
F-12 COMPUSYSTEMS, INC. UNAUDITED COMBINED STATEMENT OF OPERATIONS FOR THE QUARTER ENDED MARCH 31, 1996 (DOLLARS IN THOUSANDS)
NET REVENUES: Systems $1,043 Maintenance, forms and other services 1,271 -------------------- TOTAL NET REVENUES 2,314 - ------------------------------------------------------------------------------------ COST OF REVENUES: Systems 397 Maintenance, forms and other services 715 -------------------- TOTAL COST OF REVENUES 1,112 - ------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------ GROSS MARGIN 1,202 - ------------------------------------------------------------------------------------ OPERATING EXPENSES: Sales and marketing 181 General and administrative 192 Research and development 197 - ------------------------------------------------------------------------------------ TOTAL OPERATING EXPENSES 570 - ------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------ INCOME FROM OPERATIONS 632 - ------------------------------------------------------------------------------------ OTHER EXPENSE: Interest expense 4 - ------------------------------------------------------------------------------------ NET INCOME $628 - ------------------------------------------------------------------------------------
F-13 UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION Pro forma financial information is set forth herein to give effect to the acquisition of CompuSystems, Inc. ("CompuSystems") by Medic Computer Systems, Inc., ("Medic") as if the two companies had always operated on a combined basis for purposes of the Unaudited Pro Forma Consolidated Balance Sheets as of June 30,1996, and December 31, 1995, and for the Unaudited Pro Forma Consolidated Statements of Operations for the years ended December 31, 1995 and 1994 and for the six months ended June 30, 1996 and 1995. The Pro Forma Consolidated Statement of Operations for the year ended December 31, 1993 has not been presented as it is not significant to the evaluation of the combined companies. The Unaudited Pro Forma Consolidated Statements of Operations does not purport to represent what the Company's results of operations would actually have been if such transaction had in fact occurred at the beginning of the periods presented and does not purport to project the results of operations of the Company for the current year or for any future period. There are no significant adjustments made in the preparation of these pro forma combined statements. All information contained herein should be read in conjunction with the Consolidated Financial Statements and the Notes thereto of Medic and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Medic's Annual Report, the Combined Financial Statements and Notes thereto of CompuSystems incorporated by reference in Form 8-K/A Amendment 1, the Consolidated Financial Statements and the Notes thereto of Medic and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Medic's Form 10Q for the quarter ended June 1996 and the notes to the Unaudited Pro Forma Consolidated Financial Information. F-14 MEDIC COMPUTER SYSTEMS, INC. CONSOLIDATED BALANCE SHEETS (DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
JUNE 30, DECEMBER 31, 1996 1995 (unaudited) (unaudited and restated) ASSETS CURRENT ASSETS: Cash and cash equivalents $32,993 $38,935 Short-term investments 16,672 11,461 Accounts receivable, trade, net 44,898 41,189 Inventories and maintenance parts 11,994 12,294 Prepaid expenses 6,575 6,190 Other current assets 1,372 1,237 Deferred income tax benefit 2,255 2,515 - ----------------------------------------------------------------------------------------------------------------------- TOTAL CURRENT ASSETS 116,759 113,821 Property and equipment, at cost, net 8,185 7,075 Intangible assets, at cost, net 19,622 20,445 Other assets 99 122 - ----------------------------------------------------------------------------------------------------------------------- TOTAL ASSETS $144,665 $141,463 - ----------------------------------------------------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of long-term note $1,475 $2,677 Accounts payable, trade 5,520 7,336 Customer deposits and deferred maintenance revenue 9,573 13,396 Income taxes payable 0 1,676 Accrued expenses: Commissions 1,660 1,604 Compensation and related items 5,985 3,963 Other 2,746 3,075 - ----------------------------------------------------------------------------------------------------------------------- TOTAL CURRENT LIABILITIES 26,959 33,727 Long-term note, less current portion 2,192 3,127 Other long-term liabilities 134 172 - ----------------------------------------------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY: Common Stock, $.01 par value; 40,000,000 shares authorized; 24,336,008 and 24,210,264 shares issued and outstanding in 1996 and 1995, respectively 243 242 Additional paid-in capital 69,960 68,628 Retained earnings 45,177 35,567 - ----------------------------------------------------------------------------------------------------------------------- 115,380 104,437 - ----------------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $144,665 $141,463 - -----------------------------------------------------------------------------------------------------------------------
F-15 MEDIC COMPUTER SYSTEMS, INC. UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994 (DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
1995 1994 ---- ---- NET REVENUES: Systems $77,618 $59,794 Maintenance, forms and other services 75,898 55,561 -------------------------------- TOTAL NET REVENUES 153,516 115,355 - ----------------------------------------------------------------------------------------- COST OF REVENUES: Systems 48,275 36,752 Maintenance, forms and other services 43,846 30,327 -------------------------------- TOTAL COST OF REVENUES 92,121 67,079 - ----------------------------------------------------------------------------------------- -------------------------------- GROSS MARGIN 61,395 48,276 - ----------------------------------------------------------------------------------------- OPERATING EXPENSES: Sales and marketing 15,001 12,639 General and administrative 8,503 6,968 Amortization of intangible assets 2,872 3,088 Research and development 8,391 5,991 - ----------------------------------------------------------------------------------------- TOTAL OPERATING EXPENSES 34,767 28,686 - ----------------------------------------------------------------------------------------- -------------------------------- INCOME FROM OPERATIONS 26,628 19,590 - ----------------------------------------------------------------------------------------- OTHER INCOME: Interest income (1,868) (317) - ----------------------------------------------------------------------------------------- INCOME BEFORE INCOME TAXES 28,496 19,907 PROVISION FOR INCOME TAXES 10,102 7,233 - ----------------------------------------------------------------------------------------- -------------------------------- NET INCOME 18,394 12,674 - ----------------------------------------------------------------------------------------- PRO FORMA DATA: INCOME BEFORE PRO FORMA INCOME TAX PROVISION 18,394 12,674 PRO FORMA INCOME TAX EXPENSE FOR THE PERIODS PRIOR TO MAY 31, 1996 FOR COMPUSYSTEMS 1,178 968 -------------------------------- -------------------------------- PRO FORMA NET INCOME $17,216 $11,706 - ----------------------------------------------------------------------------------------- PRO FORMA EARNINGS PER SHARE: NET INCOME PER SHARE $0.72 $0.52 - ----------------------------------------------------------------------------------------- WEIGHTED AVERAGE COMMON SHARES AND EQUIVALENTS USED IN COMPUTING NET INCOME PER SHARE 23,951,132 22,513,824 - -----------------------------------------------------------------------------------------
F-16 MEDIC COMPUTER SYSTEMS, INC. PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
------------------------------ SIX MONTHS ENDED ------------------------------ JUNE 30, JUNE 30, 1996 1995 ---- ---- NET REVENUES: Systems $41,488 $34,845 Maintenance, forms and other services $46,470 $34,658 ------------------------------ TOTAL NET REVENUES 87,958 69,503 - -------------------------------------------------------------------------------------------------------------------- COST OF REVENUES: Systems 24,888 21,880 Maintenance, forms and other services 27,841 19,753 ------------------------------ TOTAL COST OF REVENUES 52,729 41,633 - -------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------- GROSS MARGIN 35,229 27,870 - -------------------------------------------------------------------------------------------------------------------- OPERATING EXPENSES: Sales and marketing 8,397 6,748 General and administrative 4,862 3,665 Amortization of intangible assets 892 1,512 Research and development 4,793 3,686 - -------------------------------------------------------------------------------------------------------------------- TOTAL OPERATING EXPENSES 18,944 15,611 - -------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------- INCOME FROM OPERATIONS 16,285 12,259 - -------------------------------------------------------------------------------------------------------------------- OTHER INCOME: Interest income (1,118) (706) - -------------------------------------------------------------------------------------------------------------------- INCOME BEFORE TAXES 17,403 12,965 ------------------------------ PROVISION FOR INCOME TAXES 6,320 4,591 - -------------------------------------------------------------------------------------------------------------------- NET INCOME $11,083 8,374 - -------------------------------------------------------------------------------------------------------------------- PRO FORMA DATA: INCOME BEFORE PRO FORMA INCOME TAX PROVISION $11,083 $8,374 PRO FORMA INCOME TAX EXPENSE FOR THE PERIODS PRIOR TO MAY 31, 1996 FOR COMPUSYSTEMS 489 557 - -------------------------------------------------------------------------------------------------------------------- PRO FORMA NET INCOME $10,594 $7,817 - -------------------------------------------------------------------------------------------------------------------- PRO FORMA EARNINGS PER SHARE: Net income per share $0.43 $0.33 - -------------------------------------------------------------------------------------------------------------------- Weighted average common shares and equivalents used in computing net income per share 24,786,156 23,387,158 - --------------------------------------------------------------------------------------------------------------------
Notes to Pro Forma Combined Statement of Operations Merger related expenses of $243 have been included in the Pro Forma Consolidated Statement of Operations for the six months ended June 30, 1996. F-17 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. MEDIC COMPUTER SYSTEMS, INC. Date: August 13, 1996 /s/ Luanne L. Roth ------------------ Luanne L. Roth Vice President, Chief Financial Officer, Secretary and Treasurer (Principal Financial and Accounting Officer) EX-23 2 EXHIBIT 23.1.1 Consent of Independent Public Accountants As independent public accounts, we hereby consent to the use of our report on the combined financial statements of CompuSystems, Inc. for the year ended December 31, 1995, included in or made a part of this Form 8-K/A Amendment No. 1. /s/ Arthur Andersen LLP Columbia, South Carolina, August 9, 1996. -----END PRIVACY-ENHANCED MESSAGE-----