<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
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 4, 1996 (September 26, 1996)
SCB COMPUTER TECHNOLOGY, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Tennessee 0-27694 62-1201561
- ---------------------------- ----------------------- ---------------------
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
1365 West Brierbrook Road, Memphis, Tennessee 38138
- --------------------------------------------- ---------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (901) 754-6577
Not Applicable
- --------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE> 2
This Current Report on Form 8-K/A amends and supersedes "Item 7.
Financial Statements and Exhibits" of the Registrant's Current Report on Form
8-K, dated October 8, 1996.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
- --------------------------------------------------------------------------------
(a) and (b) Financial Statements of Business Acquired and Pro Forma Financial
Information.
Independent Auditor's Report*
Balance Sheet at December 31, 1995*
Statement of Operations for the year ended December 31, 1995*
Statement of Stockholders' Equity for the year ended December 31, 1995*
Statement of Cash Flows for the year ended December 31, 1995*
Notes to Financial Statements*
Unaudited Pro Forma Combined Financial Information
Unaudited Pro Forma Combined Statement of Operations for the fiscal
quarters ended July 31, 1996 and 1995 and for the fiscal years
ended April 30, 1996, 1995, and 1994
Unaudited Pro Forma Combined Balance Sheet for the fiscal quarter ended
July 31, 1996
Notes to Unaudited Pro Forma Combined Financial Information
(c) Exhibits. See Exhibit Index following signature page.*
- ------------------
* previously filed
2
<PAGE> 3
Unaudited Pro Forma Combined Financial Information As of July 31,
1996 and for the quarter ended July 31, 1996 and 1995 and
for the fiscal years in the three-year period ended April 30, 1996
SCB Computer Technology, Inc. (SCB) and Delta Software Services, Inc. (Delta)
The following unaudited pro forma combined financial information presents the
pro forma effect of the combination of Delta and SCB on SCB's historical
financial position and results of operations using the pooling-of-interests
method of accounting. Delta's fiscal year ends December 31. In presenting the
pooling-of-interests combination on a pro forma basis, Delta's financial
statements for the twelve months ended April 30, 1996, 1995 and 1994 were
combined with SCB's financial statements for the same periods. The pro forma
statements of operations for the quarters ended July 31, 1996 and 1995 and the
balance sheet as of July 31, 1996 of SCB have been combined with Delta's
statements of operations for the quarters ended July 31, 1996 and 1995,
respectively, and the balance sheet as of July 31, 1996. The pro forma combined
financial information has been prepared and included as required by the rules
and regulations of the Securities and Exchange Commission and does not purport
to be indicative of the results that actually would have been obtained if the
combination had been effected on the dates indicated or of the results which
may be obtained in the future.
<PAGE> 4
SCB Computer Technology, Inc. and Delta Software Services, Inc.
Unaudited Pro Forma Combined Statement of Operations
<TABLE>
<CAPTION>
HISTORICAL
----------------------- --------------------
SCB COMPUTER DELTA SOFTWARE PRO FORMA
TECHNOLOGY, INC. SERVICES, INC. COMBINED
QUARTER ENDED QUARTER ENDED PRO FORMA QUARTER ENDED
JULY 31, 1996 JULY 31, 1996 ADJUSTMENTS JULY 31, 1996
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue $13,175,384 $2,405,933 $15,581,317
Cost of services 9,397,393 1,665,148 11,062,541
--------------------------------------------------------------------------------------
Gross profit 3,777,991 740,785 4,518,776
Compensation-key executives 250,000 - 250,000
Selling, general and administrative
expenses 2,122,526 398,653 2,521,179
--------------------------------------------------------------------------------------
Total operating expenses 2,372,526 398,653 2,771,179
--------------------------------------------------------------------------------------
Income from operations 1,405,465 342,132 1,747,597
Other income (expense), net 225,268 (10,382) 214,886
--------------------------------------------------------------------------------------
Income before income taxes 1,630,733 331,750 1,962,483
Income tax expense 665,000 19,905 115,395(d) 800,300
--------------------------------------------------------------------------------------
Net income $ 965,733 $ 311,845 $(115,395)(d) $ 1,162,183
======================================================================================
Net income per share $.14 $779.61 $.16
======================================================================================
Weighted average number of common and 461,536(a)
common equivalent shares outstanding 7,015,583 400 (400)(a) 7,477,119
======================================================================================
</TABLE>
<PAGE> 5
SCB Computer Technology, Inc. and Delta Software Services, Inc.
Unaudited Pro Forma Combined Statement of Operations
<TABLE>
<CAPTION>
HISTORICAL
----------------------------------------------
SCB COMPUTER DELTA SOFTWARE PRO FORMA
TECHNOLOGY, INC. SERVICES, INC. COMBINED
QUARTER ENDED QUARTER ENDED PRO FORMA QUARTER ENDED
JULY 31, 1995 JULY 31, 1995 ADJUSTMENTS JULY 31, 1995
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue $10,713,047 $1,976,602 $12,689,649
Cost of services 7,533,782 1,278,555 8,812,337
---------------------------------------------------------------------------------------
Gross profit 3,179,265 698,047 3,877,312
Compensation-key executives 1,354,510 - 1,354,510
Selling, general and administrative
expenses 1,164,750 530,977 1,695,727
---------------------------------------------------------------------------------------
Total operating expenses 2,519,260 530,977 3,050,237
---------------------------------------------------------------------------------------
Income from operations 660,005 167,070 827,075
Other income (expense), net (43,157) (10,058) (53,215)
---------------------------------------------------------------------------------------
Income before income taxes 616,848 157,012 773,860
Income tax expense 266,170 4,874 62,926(d) 333,970
---------------------------------------------------------------------------------------
Net income $ 350,678 $ 152,138 $(62,926)(d) $ 439,890
=======================================================================================
Net income per share $.06 $380.35 $.07
=======================================================================================
Weighted average number of common and 461,536(a)
common equivalent shares outstanding 5,433,843 400 (400)(a) 5,895,379
=======================================================================================
</TABLE>
<PAGE> 6
SCB Computer Technology, Inc. and Delta Software Services, Inc.
Unaudited Pro Forma Combined Statement of Operations
<TABLE>
<CAPTION>
HISTORICAL
---------------------------------------------
SCB COMPUTER DELTA SOFTWARE PRO FORMA
TECHNOLOGY, INC. SERVICES, INC. COMBINED
YEAR ENDED YEAR ENDED PRO FORMA YEAR ENDED
APRIL 30, 1996 APRIL 30, 1996 ADJUSTMENTS APRIL 30, 1996
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue $48,710,092 $7,313,779 $56,023,871
Cost of services 34,798,688 4,709,734 39,508,422
-------------------------------------------------------------------------------------
Gross profit 13,911,404 2,604,045 16,515,449
Compensation-key executives 3,764,840 - 3,764,840
Selling, general and administrative
expenses 7,508,308 2,071,915 9,580,223
-------------------------------------------------------------------------------------
Total operating expenses 11,273,148 2,071,915 13,345,063
-------------------------------------------------------------------------------------
Income from operations 2,638,256 532,130 3,170,386
Other income (expense), net 28,983 (55,911) (26,928)
-------------------------------------------------------------------------------------
Income before income taxes 2,667,239 476,219 3,143,458
Income tax expense 1,165,148 21,391 186,600(d) 1,373,139
-------------------------------------------------------------------------------------
Net income $ 1,502,091 $ 454,828 $(186,600)(d) $ 1,770,319
=====================================================================================
Net income per share $.26 $1,137.07 $.28
=====================================================================================
Weighted average number of common and 461,536(a)
common equivalent shares outstanding 5,760,807 400 (400)(a) 6,222,343
=====================================================================================
</TABLE>
<PAGE> 7
SCB Computer Technology, Inc. and Delta Software Services, Inc.
Unaudited Pro Forma Combined Statement of Operations
<TABLE>
<CAPTION>
HISTORICAL
----------------------- ---------------------
SCB COMPUTER DELTA SOFTWARE PRO FORMA
TECHNOLOGY, INC. SERVICES, INC. COMBINED
YEAR ENDED YEAR ENDED PRO FORMA YEAR ENDED
APRIL 30, 1995 APRIL 30, 1995 ADJUSTMENTS APRIL 30, 1995
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue $33,354,659 $5,815,460 $39,170,119
Cost of services 23,699,036 3,328,123 27,027,159
--------------------------------------------------------------------------------------
Gross profit 9,655,623 2,487,337 12,142,960
Compensation-key executives 4,170,000 - 4,170,000
Selling, general and administrative
expenses 3,785,043 1,687,132 5,472,175
--------------------------------------------------------------------------------------
Total operating expenses 7,955,043 1,687,132 9,642,175
--------------------------------------------------------------------------------------
Income from operations 1,700,580 800,205 2,500,785
Other income (expense), net (159,763) 13,845 (145,918)
--------------------------------------------------------------------------------------
Income before income taxes 1,540,817 814,050 2,354,867
Income tax expense 716,604 1,598 378,600(d) 1,096,802
--------------------------------------------------------------------------------------
Net income $ 824,213 $ 812,452 $(378,600)(d) $ 1,258,065
======================================================================================
Net income per share $.15 $2,031.13 $.21
======================================================================================
Weighted average number of common and 461,536(a)
common equivalent shares outstanding 5,433,843 400 (400)(a) 5,895,379
======================================================================================
</TABLE>
<PAGE> 8
SCB Computer Technology, Inc. and Delta Software Services, Inc.
Unaudited Pro Forma Combined Statement of Operations
<TABLE>
<CAPTION>
HISTORICAL
--------------------------------------------
SCB COMPUTER DELTA SOFTWARE PRO FORMA
TECHNOLOGY, INC. SERVICES, INC. COMBINED
YEAR ENDED YEAR ENDED PRO FORMA YEAR ENDED
APRIL 30, 1994 APRIL 30, 1994 ADJUSTMENTS APRIL 30, 1994
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue $23,909,942 $4,654,675 $28,564,617
Cost of services 17,290,144 3,252,798 20,542,942
------------------------------------------------------------------------------------
Gross profit 6,619,798 1,401,877 8,021,675
Compensation-key executives 3,130,740 - 3,130,740
Selling, general and administrative
expenses 3,129,911 1,708,512 4,838,423
------------------------------------------------------------------------------------
Total Operating expenses 6,260,651 1,708,512 7,969,163
------------------------------------------------------------------------------------
Income from operations 359,147 (306,635) 52,512
Other income (expense), net (110,106) 194,242 84,136
-------------------------------------------------------------------------------------
Income before income taxes and
cumulative effect of change in
accounting principle 249,041 (112,393) 136,648
Income tax expense (benefit) 114,343 1,200 (52,800)(d) 62,743
------------------------------------------------------------------------------------
Income before cumulative effect of
change in accounting principle 134,698 (113,593) 52,800(d) 73,905
Cumulative effect of change in accounting
principle (35,874) - (35,874)
------------------------------------------------------------------------------------
Net income $ 98,824 $ (113,593) $ 52,800(d) $ 38,031
====================================================================================
Earnings per share:
Income before cumulative effect of
change in accounting principle $.03 $283.98 $.01
Cumulative effect of change (.01) (.01)
------------------------------------------------------------------------------------
Net income per share $.02 $283.98 $-
====================================================================================
Weighted average number of common and 461,536(a)
common equivalent shares outstanding 5,433,843 400 (400)(a) 5,895,379
====================================================================================
</TABLE>
<PAGE> 9
SCB Computer Technology, Inc. and Delta Software Services, Inc.
Unaudited Pro Forma Combined Balance Sheet
<TABLE>
<CAPTION>
HISTORICAL
----------------------- ----------------------
SCB COMPUTER DELTA SOFTWARE PRO FORMA
TECHNOLOGY, INC. SERVICES, INC. PRO FORMA COMBINED
JULY 31, 1996 JULY 31, 1996 ADJUSTMENTS JULY 31, 1996
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents:
Cash $ 1,555,254 $ 433,876 $ 1,989,130
Securities purchased under
agreement to resell 18,500,000 - 18,500,000
Accounts receivable:
Trade 6,413,518 1,376,150 7,789,668
Related parties 8,071 9,725 17,796
Prepaid expenses 59,728 - 59,728
Deferred federal and state income
tax 188,160 - 188,160
Federal & state income taxes
refundable 2,370 - 2,370
------------------------------------------------------------------------------------
Total current assets 26,727,101 1,819,751 28,546,852
Fixed assets:
Buildings 1,348,293 - 1,348,293
Furniture, fixtures, and equipment 797,314 382,278 1,179,592
Accumulated depreciation (368,707) (262,008) (630,715)
------------------------------------------------------------------------------------
1,776,900 120,270 1,897,170
Land 443,301 - 443,301
------------------------------------------------------------------------------------
2,220,201 120,270 2,340,471
Other 8,491 9,423 17,914
------------------------------------------------------------------------------------
Total assets $28,955,793 $1,949,444 $30,905,237
====================================================================================
</TABLE>
<PAGE> 10
SCB Computer Technology, Inc. and Delta Software Services, Inc.
Unaudited Pro Forma Combined Balance Sheet
<TABLE>
<CAPTION>
HISTORICAL
---------------------------------------------
SCB COMPUTER DELTA SOFTWARE PRO FORMA
TECHNOLOGY, INC. SERVICES, INC. PRO FORMA COMBINED
JULY 31, 1996 JULY 31, 1996 ADJUSTMENTS JULY 31, 1996
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable-trade $ 631,663 $ 67,347 $ 699,010
Accrued and withheld payroll taxes,
insurance, and payroll deductions 64,882 73,414 138,296
Accrued vacation 471,748 - 471,748
Other accrued expenses 456,641 151,798 608,439
Accrued federal and state income
taxes 673,645 19,905 115,395(d) 808,945
------------------------------------------------------------------------------------
Total current liabilities 2,298,579 312,464 115,395(d) 2,726,438
Long-term liabilities:
Deferred federal and state income
taxes 22,800 59,961 431,000(c) 513,761
------------------------------------------------------------------------------------
22,800 59,961 431,000(c) 513,761
------------------------------------------------------------------------------------
Total liabilities 2,321,379 372,425 546,395 3,240,199
SHAREHOLDERS' EQUITY:
Preferred stock, no par value-
authorized 1,000,000 shares,
none issued
Common stock-20,000,000 shares of
$.01 par value authorized and
7,015,583 shares issued and
outstanding at July 31, 1996 70,155 1,600 - 71,755
Additional paid-in capital 22,516,279 1,953 1,573,466(b) 23,545,303
(431,000)(c)
(115,395)(d)
Retained earnings 4,047,980 1,573,466 (1,573,466)(b) 4,047,980
------------------------------------------------------------------------------------
Total shareholders' equity 26,634,414 1,577,019 (546,395) 27,665,038
------------------------------------------------------------------------------------
Total liabilities and shareholders' equity $28,955,793 $1,949,444 $ - $30,905,237
====================================================================================
</TABLE>
See accompanying notes.
<PAGE> 11
SCB Computer Technology, Inc. and Subsidiaries
Notes to Unaudited Pro Forma Combined Financial Information
THE FOLLOWING PRO FORMA ITEMS ARE REFLECTED IN THE ACCOMPANYING UNAUDITED PRO
FORMA COMBINED BALANCE SHEET AND STATMENTS OF OPERATIONS.
(a) Pro forma net income per common and common equivalent share was
computed by dividing pro forma net income by the pro forma
combined weighted average number of common and common
equivalent shares outstanding. The pro forma adjustment for
combined weighted average number of common and common
equivalent shares was based upon the number of common and
common equivalent shares issued in combination with Delta.
(b) Adjustment to transfer the undistributed earnings of Delta to
additional paid-in capital from retained earnings. Delta was an
S Corporation and under a pooling of interests business
combination, the combined enterprise should report the
undistributed earnings of the S Corporation as additional
capital.
(c) Adjustment to recognize the effect of recording net deferred tax
liabilities related to existing temporary differences of Delta
as if it had been a C Corporation versus an S Corporation. The
net deferred tax liabilities and corresponding deferred tax
expense will be recorded in the historical financial statements
in the second quarter of fiscal 1997.
(d) Adjustment to recognize the effect of the income tax (expense)
benefit for Delta as if it had been subject to taxation as a C
Corporation versus an S Corporation. As a result of Delta being
a subchapter S Corporation, any tax liabilities prior to the
combination were the responsibility of the individual Delta
shareholders.
In connection with the merger, approximately $118,000 of merger costs and
expenses will be incurred and will be charged to expense in the second quarter
of fiscal 1997. The merger expenses will consist of legal, accounting and
investment advisor fees. These expenses have not been included in the Pro Forma
Combined Financial Information.
<PAGE> 12
SIGNATURE
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.
SCB COMPUTER TECHNOLOGY, INC.
Date: December 4, 1996 By: /s/ Gordon L. Bateman
-----------------------
Gordon L. Bateman
Executive Vice President of
Finance and Administration and
Chief Financial Officer
