-----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, VJum4EXn0O0mUVNJoU4a1zD9Jq4kSLVTZ+TP5/M75fmwjsF60V2wqVYKKHy2+6/u CkQCnSTEMw0Ys/f+NfzKKw== 0000936392-97-000273.txt : 19970223 0000936392-97-000273.hdr.sgml : 19970223 ACCESSION NUMBER: 0000936392-97-000273 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960312 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970221 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERACTIVE GROUP INC CENTRAL INDEX KEY: 0000943354 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 952925769 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-26026 FILM NUMBER: 97541304 BUSINESS ADDRESS: STREET 1: 5095 MURPHY CANYON RD CITY: SAN DIEGO STATE: CA ZIP: 92123 BUSINESS PHONE: 6195608525 MAIL ADDRESS: STREET 1: 5095 MURPHY CANYON RD CITY: SAN DIEGO STATE: CA ZIP: 92123 8-K/A 1 FORM 8-K/A 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 ___________________________ FORM 8-K/A (AMENDMENT NO. 2) CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): December 29, 1995 Commission File Number: 0-26026 ___________________________ INTERACTIVE GROUP, INC. (Exact name of registrant as specified in its charter) DELAWARE 95-2925769 -------- ---------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification Number) 5095 MURPHY CANYON ROAD, SAN DIEGO, CA 92123 - ---------------------------------------- ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (619) 560-8525 2 The undersigned Registrant hereby amends and restates Item 7(b) of its Current Report on Form 8-K, as originally filed with the Securities and Exchange Commission on March 12, 1996 to read in full as follows: ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (b) PRO FORMA FINANCIAL INFORMATION The Registrant has attached the following financial statements reflecting the Registrant's best estimate of the pro forma effect of the acquisition of JIT on the Registrant. The following unaudited pro forma Financial Statements are attached: Introductory Statement Pro Forma Combined Balance Sheet as of December 31, 1995 Pro Forma Combined Statements of Operations for the years ended December 31, 1995 and 1994 Notes to the Pro Forma Combined Balance Sheet and Statements of Operations 2 3 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. Date: February 20, 1997 INTERACTIVE GROUP, INC. By: /s/ Michael D. Reynolds ----------------------------------- Michael D. Reynolds Chief Financial Officer 3 4 INDEX TO FINANCIAL STATEMENTS UNAUDITED PRO FORMA FINANCIAL INFORMATION: Introductory Statement F-10 Pro Forma Combined Balance Sheet F-11 Pro Forma Statements of Operations F-12 Notes to Pro Forma Combined Financial Statements F-14
4 5 INTERACTIVE GROUP, INC. AND JUST IN TIME ENTERPRISE SYSTEMS, INC. PRO FORMA COMBINED FINANCIAL INFORMATION (UNAUDITED) On December 31, 1995, Interactive Group, Inc. (the "Company") acquired all of the outstanding shares of Just In Time Enterprise Systems, Inc. ("JIT"). The following unaudited pro forma combined financial statements give effect to the acquisition by the Company of JIT accounted for under the purchase method of accounting. The pro forma combined balance sheet assumes the acquisition took place on January 1, 1994 and combines the Company's December 31, 1995 balance sheet with JIT's balance sheet as of the same date. The pro forma combined statements of operations for the years ended December 31, 1994 and 1995 combines the Company's historical statements of operations for the years ended December 31, 1994 and 1995 with the corresponding JIT historical statements of operations. The unaudited pro forma combined statements of operations are not necessarily indicative of the operating results that would have been achieved had the acquisition by the Company of JIT been in completed as of the beginning of each of the periods presented, and should not be construed as being indicative of future operations of the combined company. F-10 6 INTERACTIVE GROUP, INC. AND JUST IN TIME ENTERPRISE SYSTEMS, INC. PRO FORMA COMBINED BALANCE SHEET (Unaudited) (In Thousands)
Just In Time Interactive Enterprise Pro Forma Group, Inc. Systems, Inc. Adjustments Pro Forma Dec. 31, 1995 Dec. 31, 1995 (Notes 1, 2 & 3) Combined --------------- --------------- ---------------- --------------- ASSETS: Current assets: Cash and cash equivalents $ 5,967 $ - $ (1,316) $ 4,651 Accounts receivable, net 10,699 2,278 - 12,977 Deferred income taxes 398 - - 398 Prepaid expenses and other current assets 914 200 - 1,114 -------- -------- -------- -------- 17,978 2,478 (1,316) 19,140 Property and equipment, net 1,467 983 (120) 2,330 Deferred income taxes 1,267 - 66 1,333 Intangible assets - - 1,472 1,472 Deposits and other assets 329 - - 329 -------- -------- -------- -------- Total assets $ 21,041 $ 3,461 $ 102 $ 24,604 ======== ======== ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT): Current liabilities: Accounts payable $ 3,273 $ 1,563 $ 19 $ 4,855 Accrued expenses 3,443 1,021 462 4,926 Current Portion of obligations under capital leases 68 336 - 404 Short-term borrowings 533 - - 533 Deferred revenue and customer deposits 2,056 1,591 - 3,647 -------- -------- -------- -------- 9,373 4,511 481 14,365 Obligations under capital leases, net of current portion 70 101 - 171 Long-term obligations, less current portion - - 2,500 2,500 Amounts due to parent - 14,658 (14,658) - Stockholders' equity (deficit): Common stock 4 - - 4 Additional paid-in capital 6,462 - - 6,462 Retained earnings (accumulated deficit) 5,115 (15,809) 11,779 1,085 Cumulative foreign currency translation adjustments 17 - - 17 -------- -------- -------- -------- Total stockholders' equity (deficit) 11,598 (15,809) 11,779 7,568 -------- -------- -------- -------- Total liabilities and stockholders' equity (deficit) $ 21,041 $ 3,461 $ 102 $ 24,604 ======== ======== ======== ========
See accompanying notes to unaudited pro forma combined financial information F-11 7 INTERACTIVE GROUP, INC. AND JUST IN TIME ENTERPRISE SYSTEMS, INC. PRO FORMA COMBINED STATEMENT OF OPERATIONS (Unaudited) (In thousands except share and per share amounts)
Year Ended December 31, 1995 ---------------------------- Just In Time Interactive Enterprise Pro Forma Group, Inc. Systems, Inc. Adjustments Note Combined ----------- ------------- ----------- ---- -------- Revenues $ 32,993 $ 15,810 $ - $ 48,803 Cost of revenues 15,231 13,738 171 2 29,140 -------- -------- -------- -------- Gross margin 17,762 2,072 (171) 19,663 Operating expenses: Research and development 1,588 2,920 56 2 4,564 Selling, general and administrative 13,891 5,528 57 2 19,476 Write-off of software license 235 - 235 Compensation expense associated with employee stock bonus 871 - - 871 Purchased research and development 3,250 - (3,250) - Restructuring charge 0 2,651 - 2,651 -------- -------- -------- -------- Total 19,835 11,099 (3,137) 27,797 Income (loss) from operations (2,073) (9,027) 2,966 (8,134) Other income (expense), net 87 (17) (291) 5(g) (221) -------- -------- -------- -------- Income (loss) before income taxes (1,986) (9,044) 2,675 (8,355) Provision (benefit) for income taxes (848) (206) 1,142 4 88 -------- -------- -------- -------- Net income (loss) $ (1,138) $ (8,838) $ 1,533 $ (8,443) ======== ======== ======== ======== Net loss per share ($2.07) Weighted average shares outstanding 4,084,000
See accompanying notes to unaudited pro forma combined financial information F-12 8 INTERACTIVE GROUP, INC. AND JUST IN TIME ENTERPRISE SYSTEMS, INC. PRO FORMA COMBINED STATEMENT OF OPERATIONS (Unaudited) (In Thousands)
Year Ended December 31, 1995 ---------------------------- Just In Time Interactive Enterprise Pro Forma Group, Inc. Systems, Inc. Adjustments Note Combined ----------- ------------- ----------- ---- -------- Revenues $ 28,625 $ 16,822 $ - $ 45,447 Cost of revenues 13,597 11,285 171 2 25,053 -------- -------- ------ -------- Gross margin 15,028 5,537 (171) 20,394 Operating expenses: Research and development 1,320 4,533 56 2 5,909 Selling, general and administrative 10,847 7,799 57 2 18,703 -------- -------- ------ -------- Total 12,167 12,332 113 24,612 Income (loss) from operations 2,861 (6,795) (284) (4,218) Other income (expense), net (80) (32) (306) 5(h) (418) -------- -------- ------ -------- Income (loss) before income taxes 2,781 (6,827) (590) (4,636) Provision (benefit) for income taxes 972 (11) (207) 4 755 -------- -------- ------ -------- Net income (loss) $ 1,809 $ (6,816) $ (384) $ (5,391) ======== ======== ====== ======== Net loss per share ($ 1.46) Weighted average shares outstanding 3,685,000
See accompanying notes to unaudited pro forma combined financial information F-13 9 INTERACTIVE GROUP, INC. AND JUST IN TIME ENTERPRISE SYSTEMS, INC. NOTES TO PRO FORMA COMBINED FINANCIAL INFORMATION (UNAUDITED) NOTE 1: The pro forma combined balance sheet reflects the acquisition of all of the capital stock of JIT in exchange for $1.5 million of cash, $2.5 million note payable, and net liabilities of $4.3 million. In addition, $1.2 million of contingent consideration is payable based on a percentage of future revenues generated from the JIT software. The initial purchase price of $8.3 million was allocated as follows based upon a valuation of the tangible and intangible assets, including acquired technology and in-process research and development, by an independent appraiser, as well as management's best estimates (in thousands). Current assets $2,165 Fixed assets 863 Trademarks and trade names 457 Assembled work force 790 Customer base 440 Developed technology 353 In-process technology 3,250 ------ $8,318
NOTE 2: The allocation of the purchase price was applied to the historical balance sheet or historical statements of operations of the Company and JIT to arrive at the pro forma combined balance sheet and statements of operations. The trademarks, assembled work force, customer base, and developed technology (total of $2,040,000) are being amortized over estimated useful lives ranging from 5 to 10 years. The pro forma combined statements of operations for the years ended December 31, 1994 and 1995 reflect amortization expense of $284,000 for each period, with the amortization being charged to cost of revenues, $171,000; research and development expense, $56,000; and selling, general and administrative expense, $57,000. Intangible assets reflect the $2,040,000 shown above. NOTE 3: Interest income has been reduced in the pro forma combined statement of operations to reflect the net decrease in cash of $1.5 million and $1.2 million that would have been available to invest during the years ended December 31, 1994 and 1995, respectively, had the transaction occurred on January 1, 1994. The assumed interest rate used to calculate interest income was 5% per annum. For the years ended December 31, 1994 and 1995 the reduction was $75,000 and $60,000, respectively, for each period. Interest expense has been increased in the pro forma combined statements of operations to reflect the $2.5 million note payable that would have been incurred had the transaction been effected on January 1, 1994. The assumed interest rate used to calculate interest expense was 9.25% per annum. For the years ended December 31, 1994 and 1995 the interest expense reflected was $231,000 for each period. NOTE 4: The provisions for income taxes have been adjusted for each year presented by the Company's effective tax rate to reflect the impact of the combined operations on the results of the periods presented. . The effective tax rates for the years ended December 31, 1994 and December 31, 1995 were 35% and 42.7%, respectively. F-14 10 NOTE 5: The following reconciliations provide detail for certain adjustments to the proforma balance sheet and statements of operation: (a) (1,500) Cash to purchase JIT Note 1 (75) Reduction of interest revenue 1994 Note 3 (60) Reduction of interest revenue 1995 Note 3 -------- (1,635) Adjustment to cash (b) 863 Fixed assets assumed in purchase price Note 1 (983) Fixed asssets per balance sheet ----- (120) Adjustment to fixed assets (c) 207 Provision for income tax adjustment to 1994 income statement (1,142) Provision for income tax adjustment to 1995 income statement ------ (935) Adjustment to deferred income taxes (d) 457 Trademarks and tradenames Note 1 790 Assembled workforce Note 1 440 Customer base Note 1 353 Developed technology Note 1 ------ 2,040 Adjustment to intangibles (e) 19 Elimination of costs to acquire JIT (f) 15,809 JIT accumulated deficit (1,717) Proforma adjustments to 1995 operations statement, net of purchased research and development (383) Proforma adjustments to 1994 operations statement 568 Amortization of intangible assets Note 2 (3,250) Retained earnings adjustment related to in-process research and development write-off ------- 11,027 Adjustment to retained earnings (g) (231) Additional interest expense Note 3 (60) Reduction of interest revenue Note 3 ------ (291) Adjustment to 1995 other income (expense) (h) (231) Additional interest expense Note 3 (75) Reduction of interest revenue Note 3 ------ (306) Adjustment to 1994 other income (expense)
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