SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________
FORM 8-K
CURRENT REPORT
ON FORM 8-K
PURSUANT TO
SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of December 31, 1998
earliest event reported):
THE VIALINK COMPANY
(Exact Name of Registrant as Specified
in Its Charter)
Oklahoma
(State of Other
Jurisdiction of
Incorporation)
000-21729 73-1247666
(Commission File (IRS Employer
Number) Identification No.)
13800 Benson Road, Edmond, Oklahoma 73013-6417
(Address of Principal Executive Offices) (Zip Code)
(405) 936-2500
(Registrant's Telephone Number,
Including Area Code)
N/A
(Former Name or Former Address, if
Changed Since Last Report)
Item 2.Acquisition or Disposition of Assets.
On December 31, 1998, we sold our ijob, Inc. subsidiary to
DCM Company, Inc., a corporation wholly owned by David C. Mitchell,
the President and a member of the Board of Directors of ijob at the
time of the sale. Our ijob subsidiary operated our Web-based human
resources application asset. The sale of ijob represents another step
in our effort to shed non-core assets and focus on the development of
our viaLink services. We organized ijob in April 1997 to operate
ijob.com, a human resources recruiting application.
DCM purchased all of the outstanding stock of ijob from us
in exchange for a secured, ten-year, $800,000 promissory note that
accrues interest at a rate of 8% per annum. DCM is obligated to pay
the note in full upon the occurrence of certain events, including,
among other things, in the event that Mr. Mitchell ceases to own at
least 51% of DCM. The note is collateralized by principally all of
the fixed assets, contract rights, accounts receivable and general
intangibles of ijob.
The pro forma consolidated statement of operations attached
as Exhibit 99.1 hereto is intended to illustrate the effect of the
sale of our ijob subsidiary, as well as the sale of our consulting
business to The Netplex Group, Inc. effective September 1, 1998 and
are based on available information and certain assumptions which we
believe are reasonable. These assets accounted for 90% of our
historical revenues.
Subsequent Event
On March 11, 1999, we received $800,000 from DCM in full
payment of the promissory note we were issued by DCM upon our sale of
ijob. We have released all security interests which we held pursuant
to the Security and Pledge Agreement in the fixed assets, contract
rights, accounts receivable and general intangibles of ijob.
Item 7.Financial Statements, Pro Forma Financial Information and
Exhibits
(b) Pro forma financial information
The pro forma consolidated statement of operations included
as Exhibit 99.1 hereto is provided to illustrate the effect
on our historical financial statements of the sale of ijob
on December 31, 1998, as well as the sale of our consulting
business effective September 1, 1998.
For more information on the sale of our consulting business,
please refer to our Current Report on Form 8-K dated October
16, 1998.
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(c) Exhibits
No. Description
2.1* Stock Purchase Agreement dated December 31, 1998
by and among Registrant, DCM Company, Inc., David
C. Mitchell and ijob, Inc. (filed as Exhibit 2.5
to Registrant's Annual Report on Form 10-KSB for
the year ending December 31, 1998 (the "1998 Form
10-KSB") and incorporated herein by reference)
10.1* Secured Promissory Note dated December 31, 1998
entered into by DCM Company, Inc. and ijob, Inc.
in favor of Registrant, (filed as Exhibit 10.19 to
the 1998 Form 10-KSB and incorporated herein by
reference)
10.2* Security and Pledge Agreement dated as of December
31, 1998 by and among Registrant, DCM Company,
Inc. and ijob, Inc., (filed as Exhibit 10.20 to
the 1998 Form 10-KSB and incorporated herein by
reference)
99.1 The following Pro Forma Consolidated Financial Statements of
Registrant:
Unaudited Pro Forma Consolidated Statement of
Operations for the Year Ended December 31,
1998
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
THE VIALINK COMPANY
(formerly Applied Intelligence
Group, Inc.)
Dated: March 17, 1999
By: /s/ John M. Duck
John M. Duck,
Vice President and Chief Financial
Officer
(principal financial and accounting
officer)
EXHIBIT INDEX
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No. Description
2.1* Stock Purchase Agreement dated December 31, 1998
by and among Registrant, DCM Company, Inc., David
C. Mitchell and ijob, Inc. (filed as Exhibit 2.5
to Registrant's Annual Report on Form 10-KSB for
the year ending December 31, 1998 (the "1998 Form
10-KSB") and incorporated herein by reference)
10.1* Secured Promissory Note dated December 31, 1998
entered into by DCM Company, Inc. and ijob, Inc.
in favor of Registrant (filed as Exhibit 10.19 to
the 1998 Form 10-KSB and incorporated herein by
reference)
10.2* Security and Pledge Agreement dated as of December
31, 1998 by and among Registrant, DCM Company,
Inc. and ijob, Inc. (filed as Exhibit 10.20 to the
1998 Form 10-KSB and incorporated herein by
reference)
99.1 The following Pro Forma Consolidated Financial Statements of
Registrant:
Unaudited Pro Forma Consolidated Statement of
Operations for the Year Ended December 31,
1998
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EXHIBIT 99.1
THE VIALINK COMPANY (formerly Applied Intelligence Group, Inc.)
Unaudited Pro Forma Consolidated Statement of Operations
The accompanying unaudited pro forma consolidated statement
of operations is provided to illustrate the effect of the sale of The
viaLink Company's (formerly Applied Intelligence Group, Inc.)
("viaLink") wholly-owned subsidiary, ijob, Inc., to DCM Company, Inc.
and the sale of the consulting business of viaLink to The Netplex
Group, Inc. on the historical financial statements of viaLink, as if
these sales had occurred, for statement of operations purposes on
January 1, 1998. The unaudited pro forma consolidated statement of
operations is not necessarily indicative of operating results which
would have been achieved had the sales been consummated as of the
beginning of the period presented and should not be construed as
representative of future operations. The unaudited pro forma
adjustments described in the accompanying notes are based on available
information and certain assumptions that viaLink believes are
reasonable. These unaudited pro forma financial statements should be
read in conjunction with the viaLink's Annual Report on Form 10-KSB
for the year ended December 31, 1998.
THE VIALINK COMPANY (formerly Applied Intelligence Group, Inc.)PRO
FORMA CONSOLIDATED STATEMENT OF OPERATIONSFor the Twelve Months Ended
December 31, 1998 (unaudited)
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Pro Forma
Pro Forma Adjustments
Adjustments Pro Forma Consulting
December ijob December Business December
31, 1998 Sale 31, 1998 Sale 31, 1998
---------- ---------- ---------- ---------- ----------
Revenues $8,230,628 $ 666,125(a) $7,564,503 $6,831,916(e) $ 732,587
Expenses:
Direct cost
of sales 1,563,757 - 1,563,757 (1,563,757)(f) -
Salaries
and benefits 5,256,247 (535,570)(b) 4,720,677 130,000 (g) 2,287,401
(2,563,276)(h)
Selling,
general and
admini-
strative 1,964,180 (269,196)(c) 1,694,984 (662,505)(i) 767,479
(265,000)(j)
Interest
expense, net 161,355 - 161,355 (161,355)(k) -
Depreciation
and
amortization 925,134 (56,553)(d) 868,581 (255,569)(l) 613,012
--------- --------- --------- ---------- ----------
Total
Expenses 9,870,673 (861,319) 9,009,354 (5,341,462) 3,667,892
--------- --------- --------- ---------- ----------
(Loss) Income
from
Operations (1,640,045) (195,194) (1,444,851) 1,490,454 (2,935,305)
--------- -------- --------- ---------- ----------
Gain on sale
of assets 2,998,453 - 2,998,453 - 2,998,453
Other income 340,670 - 340,670 (766,000)(m) 1,106,670
--------- -------- --------- ---------- ----------
Income (loss) before
income
taxes 1,699,078 (195,194) 1,894,272 724,454 1,169,818
Provision
(benefit) for
income taxes 1,049,440 - 1,049,440 1,049,440 -
--------- -------- --------- ---------- ----------
Net income
(loss) 649,638 (195,194) 844,832 724,454 120,378
Other comprehensive loss:
Unrealized
loss on
securities (315,673) - (315,673) - (315,673)
-------- --------- --------- ---------- ----------
Comprehensive income
(loss) $ 333,965 $ (195,194) $ 529,159 $ 724,454 $ (195,295)
========= ========== ========== ========== ==========
Weighted average shares
outstanding-
Basic 2,741,041 2,741,041 2,741,041
========= ========== ===========
Net income
(loss) per
common share-
Basic $ 0.24 $ 0.31 $ 0.04
========= ========== ==========
Weighted average common
shares outstanding-
Diluted 3,102,443 3,102,443 3,102,443
========= ========== ===========
Net income (loss)
per common share-
Diluted $ 0.21 $ 0.27 $ 0.04
========= ========== ===========
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The accompanying notes are an integral part of these pro forma
consolidated financial statements.
THE VIALINK COMPANY (formerly Applied Intelligence Group, Inc.)
NOTES TO PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
December 31, 1998
(a) This adjustment eliminates the revenue directly related to ijob,
Inc. which was acquired by DCM Company, Inc. on December 31, 1998.
(b) The adjustment eliminates the direct and indirect payroll, taxes
and benefits and contract labor expenses associated with ijob, Inc.
(c) This adjustment eliminates the direct and indirect selling,
general and administrative expenses associated with ijob, Inc.
(d) This adjustment eliminates the depreciation and amortization of
the fixed assets and capitalized software development costs that were
associated with ijob, Inc.
(e) This adjustment eliminates the revenue directly related to the
consulting business of viaLink which was sold to The Netplex Group,
Inc. on September 1, 1998.
(f) This adjustment eliminates the direct cost of revenue associated
with the product and solutions revenue of viaLink's consulting
business.
(g) This adjustment accrues the estimated salary for the new CEO of
viaLink.
(h) This adjustment eliminates the direct and indirect payroll, taxes
and benefits and contract labor expenses associated with viaLink's
consulting business.
(i) This adjustment eliminates the direct and indirect selling,
general and administrative expenses associated with viaLink's
Consulting Business.
(j) This adjustment reduces selling, general and administrative
expenses for amounts that Netplex would have paid to viaLink under the
Sub-lease and the Administrative Services Agreement had the sale been
effective January 1, 1998.
(k) This adjustment eliminates interest expense because the proceeds
of the sale would have paid viaLink's credit facility and shareholder
notes at January 1, 1998.
(l) This adjustment eliminates the depreciation and amortization of
the fixed assets and capitalized software development costs that were
acquired by Netplex in the purchase of viaLink's consulting business.
(m) This adjustment records the income that would have been received
under the Earn-out Agreement with Netplex effective January 1, 1998.
