<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
Amendment No. 2 to
CURRENT REPORT
Amending Item 7
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 12, 1996 .
TMCI Electronics, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-27510 77-0413814
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1875 Dobbin Drive, San Jose, CA 95133
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 408-272-5700
<PAGE>
ITEM 7. Financial Statements and Exhibits
(a). At the time that TMCI Electronics, Inc. ("TMCI") filed the
Report on Form 8-K on November 27, 1996, the financial statements of the
division (the "Division") acquired from Pen Interconnect, Inc. ("PII") and the
related pro formas were not available. As permitted under Item 7 of Form 8-K,
TMCI stated its intent to file such financial statements as an amendment
within the required 60 days from the date that the Report was required to be
filed.
Following the closing of the acquisition, a dispute arose between
TMCI and PII. As a result, the auditors for PII ceased to cooperate with Moore
Stephens, P.C., the auditors for TMCI, in producing audited financial
statements for the Division. In view of this development, TMCI was unable to
file the audited financial statements required.
(b). The pro forma financial information being filed with this report
is as follows:
(1) Pro Forma Condensed Combined Balance Sheet as of
September 30, 1996 (unaudited);
(2) Pro Forma Condensed Combined Income Statement for the
nine months ended September 30, 1996 (unaudited); and
(3) Pro Forma Condensed Combined Income Statement for the
year ended December 31, 1995 (unaudited).
(c). The following exhibits were previously filed with the Report on
Form 8-K on November 27, 1996.
Exhibit 1. Asset Purchase Agreement
<PAGE>
TMCI ELECTRONICS, INC. AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
Pro Forma Condensed Combined Financial Statements (unaudited)
Basis of Presentation.................................................... P-1
Pro Forma Condensed Combined Balance Sheet as of
September 30, 1996 (unaudited)........................................... P-2
Pro Forma Condensed Combined Income Statement Sheet for the nine months
ended September 30, 1996 (unaudited)..................................... P-3
Pro Forma Condensed Combined Income Statement for the year ended
December 31, 1995 (unaudited)............................................ P-4
Notes to Pro Forma Condensed Combined Financial Statements (unaudited)... P-5
<PAGE>
TMCI ELECTRONICS, INC.
- -------------------------------------------------------------------------------
PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
BASIS OF PRESENTATION
[UNAUDITED]
- -------------------------------------------------------------------------------
The following pro forma condensed combined balance sheet as
of September 30, 1996 and the condensed combined statements of operations for
the nine months ended September 30, 1996 and the year ended December 31, 1995
give effect to TMCI Electronics, Inc. and Subsidiaries [the "Company"]
acquiring through its Touche Electronics, Inc. subsidiary, substantially all
of the operating assets of Pen Interconnect, Inc.'s San Jose Division ["PII"]
for a purchase price of $3,300,000.
The pro forma information is based on the historical
financial statements of the Company and the aforementioned acquired company,
giving effect to the transactions under the purchase method of accounting and
the assumptions and adjustments in the accompanying notes to the pro forma
financial statements.
The pro forma balance sheet at September 30, 1996 gives
effect to the transaction as if it occurred on the balance sheet date.
The pro forma statements of operations for the nine months
ended September 30, 1996 and for the year ended December 31, 1995 give effect
to these transactions as if they occurred at the beginning of the respective
periods presented.
The pro forma condensed combined financial statements have
been prepared by the Company 's management based upon the historical financial
statements of the Company and PII. These pro forma condensed combined
financial statements may not be indicative of the results that actually would
have occurred if the acquisitions had been in effect on the dates indicated.
The pro forma condensed combined financial statements should be read in
conjunction with the historical financial statements and notes contained
elsewhere herein and in the Company's registration statement on Form SB-2, the
Company's annual report on Form 10-KSB and the Company's quarterly reports on
Form 10-QSB.
P-1
<PAGE>
TMCI ELECTRONICS, INC.
- -------------------------------------------------------------------------------
PRO FORMA CONDENSED COMBINED BALANCE SHEET AS OF SEPTEMBER 30, 1996.
[UNAUDITED]
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Historicals
---------------------------
TMCI Pro Forma Pro Forma
Electronics, Inc. PII Adjustments Combined
----------------- --- ----------- --------
<S> <C> <C> <C> <C>
Assets:
Current Assets:
Cash $ 2,147,314 $ -- $ (2,000,000) [3] $ 147,314
Accounts Receivable [Net] 1,691,391 675,020 (254,072) [1] 2,112,339
Inventory 5,091,630 1,565,458 (849,208) [1] 5,807,880
Prepaid Expenses and Other Current
Assets 382,105 34,177 (30,133) [1] 386,149
-------------- -------------- -------------- ---------------
Total Current Assets 9,312,440 2,274,655 (3,133,413) 8,453,682
-------------- -------------- -------------- ---------------
Property and Equipment [Net] 3,447,871 638,373 (470,378) [1] 3,615,866
-------------- -------------- -------------- ---------------
Other Assets:
Due from Stockholder and Related Party 578,009 -- -- 578,009
Other Assets 734 99,139 (99,139) [1] 734
Goodwill -- -- 2,576,544 [3] 2,576,544
-------------- -------------- -------------- ---------------
Total Other Assets 578,743 99,139 2,477,405 3,155,287
-------------- -------------- -------------- ---------------
Total Assets $ 13,339,054 $ 3,012,167 $ (1,126,386) $ 15,224,835
============== ============== ============== ===============
Liabilities and Stockholders' Equity:
Liabilities:
Accounts Payable and Accrued
Expenses $ 2,421,093 $ 334,042 $ 229,000 [1] $ 2,984,135
Notes Payable and Capital Lease
Obligation - Current Portion 446,329 -- -- 446,329
-------------- -------------- -------------- ---------------
Total Current Liabilities 2,867,422 334,042 229,000 3,430,464
-------------- -------------- -------------- ---------------
Long-Term Liabilities:
Notes Payable and Capital Lease
Obligation - Net of Current Portion 1,617,779 22,739 900,000 [3] 2,540,518
Deferred Income Taxes 405,383 -- -- 405,383
-------------- -------------- -------------- ---------------
Total Long-Term Liabilities 2,023,162 22,739 900,000 2,945,901
-------------- -------------- -------------- ---------------
Total Liabilities 4,890,584 356,781 1,129,000 6,376,365
Stockholders' Equity 8,448,470 2,655,386 (2,255,386) [2,3] 8,848,470
-------------- -------------- -------------- ---------------
Total Liabilities and Stockholders'
Equity $ 13,339,054 $ 3,012,167 $ (1,126,386) $ 15,224,835
============== ============== ============== ===============
</TABLE>
P-2
<PAGE>
TMCI ELECTRONICS, INC.
- -------------------------------------------------------------------------------
PRO FORMA CONDENSED COMBINED INCOME STATEMENT FOR THE NINE MONTHS
ENDED SEPTEMBER 30, 1996.
[UNAUDITED]
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Historicals
--------------------------------
TMCI Pro Forma Adjustments Pro Forma
Electronics, Inc. PII DR CR Combined
---------------- -------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
Net Sales $ 20,496,567 $ 4,973,239 $ 1,551,484[5] $ -- $ 23,918,322
Cost of Goods Sold 13,497,840 3,817,955 -- 1,551,484 [5] 15,764,311
---------------- -------------- -------------- ------------- ---------------
Gross Profit 6,998,727 1,155,284 1,551,484 1,551,484 8,154,011
---------------- -------------- -------------- ------------- ---------------
Operating Expenses 5,170,226 584,630 -- 86,499 [6] 5,668,357
Depreciation and
Amortization 630,104 17,863 128,850[4] -- 776,817
---------------- -------------- -------------- ------------- ---------------
Total Operating
Expenses 5,800,330 602,493 128,850 86,499 6,445,174
---------------- -------------- -------------- ------------- ---------------
Income From Operations 1,198,397 552,791 1,680,334 1,637,983 1,708,837
Other Income [Expense] (478,291) (75,949) -- 42,351 [7] (511,889)
---------------- -------------- -------------- ------------- ---------------
Income Before Provision
for Income Taxes 720,106 476,842 1,680,334 1,680,334 1,196,948
Provision for Income
Taxes 254,736 125,381 -- -- 380,117
---------------- -------------- -------------- ------------- ---------------
Net Income $ 465,370 $ 351,461 $ 1,680,334 $ 1,680,334 $ 816,831
================ ============== ============== ============= ===============
Net Income Per Share $ .15 $ .27
================ ===============
Weighted Average Shares
Outstanding 3,016,403 3,070,072
================ ===============
</TABLE>
P-3
<PAGE>
TMCI ELECTRONICS, INC.
- -------------------------------------------------------------------------------
PRO FORMA CONDENSED COMBINED INCOME STATEMENT FOR THE YEAR ENDED
DECEMBER 31, 1995.
[UNAUDITED]
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Historicals
--------------------------------
TMCI Pro Forma Adjustments Pro Forma
Electronics, Inc. PII DR CR Combined
---------------- -------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
Net Sales $ 28,098,919 $ 5,130,004 $ 2,576,310[5] $ -- $ 30,652,613
Cost of Goods Sold 19,991,649 4,001,985 -- 2,576,310 [5] 21,417,324
---------------- -------------- -------------- ------------- ---------------
Gross Profit 8,107,270 1,128,019 2,576,310 2,576,310 9,235,289
---------------- -------------- -------------- ------------- ---------------
Operating Expenses 5,417,984 738,275 -- 75,215 [6] 6,081,044
Depreciation and
Amortization 966,962 23,817 171,800[4] -- 1,162,579
---------------- -------------- -------------- ------------- ---------------
Total Operating
Expenses 6,384,946 762,092 171,800 75,215 7,243,623
---------------- -------------- -------------- ------------- ---------------
Income From Operations 1,722,324 365,927 2,748,110 2,651,525 1,991,666
Other Income [Expense] (714,708) (140,084) -- 96,585 [7] (758,207)
---------------- -------------- -------------- ------------- ---------------
Income Before Provision
for Income Taxes 1,007,616 225,843 2,748,110 2,748,110 1,233,459
Provision for Income
Taxes 534,200 90,337 -- -- 624,537
---------------- -------------- -------------- ------------- ---------------
Net Income $ 473,416 $ 135,506 $ 2,748,110 $ 2,748,110 $ 608,922
================ ============== ============== ============= ===============
Net Income Per Share $ .25 $ .31
================ ===============
Weighted Average Shares
Outstanding 1,893,600 1,947,269
================ ===============
</TABLE>
P-4
<PAGE>
TMCI ELECTRONICS, INC.
NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
[UNAUDITED]
- -------------------------------------------------------------------------------
[1] To adjust to market assets acquired and liabilities assumed.
[2] To eliminate equity accounts of acquired enterprise.
[3] To record consideration paid of $2,000,000 in cash, $900,000 in
promissory notes and issuance of 134,172 shares with a fair value of
$400,000 in exchange for substantially all of the assets and
liabilities of the San Jose Division of Pen Interconnect which gives
rise to goodwill of $2,577,000 calculated as follows:
Purchase Price $ 3,300,000
Less: Assets in Excess of Liabilities Acquired 723,000
---------------
Goodwill $ 2,577,000
-------- ===============
[4] To record amortization of goodwill over 15 years utilizing the
straight-line method. Calculated as follows:
Goodwill $ 2,577,000
Life 15
---------------
Annual Amortization $ 171,800
------------------- ===============
[5] To eliminate intercompany sales and costs of goods sold.
[6] To adjust operating expenses of the San Jose Division of Pen
Interconnect to reflect a reduction of management salaries in the
amount of $75,215 and $86,499 for the year ending December 31, 1995 and
for the period ending September 30, 1996, respectively.
[7] To record gain on sale of equipment.
P-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this amendment to this report to be signed on
its behalf by the undersigned hereunto duly authorized.
TMCI ELECTRONICS, INC.
By: /s/ Charles E. Shaw
----------------------------------------
Charles E. Shaw
Vice President - Chief Financial Officer
Date: November 24, 1997
