<PAGE>
UNITED STATES
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) July 16, 1997
- ------------------------------------------------------------------------------
Puma Technology, Inc.
- ------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Delaware 333-11445 77-0349154
- ------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
2550 North First Street, Suite 500, San Jose, CA 95131
- ------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 321-7650
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
PUMA TECHNOLOGY, INC
INDEX TO FINANCIAL STATEMENTS
Page
REAL WORLD SOLUTIONS, INC.
Balance Sheet as of December 31, 1996 and March 31, 1997 (unaudited) 3
Statement of Operations for the year ended December 31, 1996 and three
months ended March 31, 1997 and 1996 (unaudited) 4
Statement of Stockholders' Deficit for the year ended December 31,
1996 and three months ended March 31, 1997 (unaudited) 5
Statement of Cash Flows for the year ended December 31, 1996 and
three months ended March 31, 1997 and 1996 (unaudited) 6
Notes to the Financial Statements 7
Independent Accountants Report 13
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
Unaudited Pro Forma Condensed Combined Balance Sheet 15
Unaudited Pro Forma Condensed Combined Statement of Operations for
year ended July 31, 1996 16
Unaudited Pro Forma Condensed Combined Statement of Operations for
nine months ended April 30, 1997 17
Notes to Unaudited Pro Forma Financial Information 18
2
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED.
The audited financial statements of Real World Solutions, Inc. (RWS) for
the year ended December 31, 1996 with the Independent Auditors' Report, and
the unaudited financial statements for the three months ended March 31, 1997
are filed as part of this Current Report on Form 8-K.
3
<PAGE>
REAL WORLD SOLUTIONS, INC.
BALANCE SHEET
ASSETS
DECEMBER 31, MARCH 31,
1996 1997
(UNAUDITED)
------------ -----------
Current assets:
Cash $ 4,000 $ 36,000
Accounts receivable 20,000 34,000
Prepaid expenses and other current assets 1,000 1,000
------------ -----------
Total current assets 25,000 71,000
Property and equipment, net 132,000 118,000
Other assets 3,000 3,000
------------ -----------
Total assets $ 160,000 $ 192,000
------------ -----------
------------ -----------
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Line of credit $ 14,000 $ 14,000
Accounts payable 65,000 45,000
Accrued expenses and other
current liabilities 31,000 6,000
Notes payable 110,000 410,000
Current portion of capital lease
obligations 18,000 18,000
------------ -----------
Total current liabilities 238,000 493,000
Capital lease obligations, net of current
portion 51,000 47,000
------------ -----------
Total liabilities 289,000 540,000
------------ -----------
Commitments (Note 7)
Stockholders' deficit:
Series A, preferred stock, no par value;
5,000,000 shares authorized; 550,000
shares issued and outstanding at
December 31, 1996 and March 31, 1997 709,000 709,000
Common stock, no par value; 15,000,000
shares authorized, 2,268,000
shares issued and outstanding at
December 31, 1996 and March 31, 1997 59,000 59,000
Accumulated deficit (897,000) (1,116,000)
------------ -----------
Total stockholders' deficit (129,000) (348,000)
------------ -----------
Total liabilities and stockholders'
deficit $ 160,000 $ 192,000
------------ -----------
------------ -----------
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
REAL WORLD SOLUTIONS, INC.
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
YEAR ENDED THREE MONTHS ENDED
DECEMBER 31, MARCH 31,
1996 1997 1996
(UNAUDITED) (UNAUDITED)
------------ ----------- -----------
<S> <C> <C> <C>
Revenue
Service $ 48,000 $ 30,000 $ 10,000
License 25,000 4,000 -
------------ ----------- -----------
Total revenue 73,000 34,000 10,000
------------ ----------- -----------
Costs and expenses
Cost of service revenue 34,000 22,000 7,000
Cost of license revenue 1,000 - -
Research and development 341,000 87,000 61,000
Selling, general and
administrative 571,000 139,000 102,000
------------ ----------- -----------
Total operating expenses 947,000 248,000 170,000
------------ ----------- -----------
Loss from operations (874,000) (214,000) (160,000)
Interest expense, net 15,000 5,000 1,000
------------ ----------- -----------
Net loss $ (889,000) $ (219,000) $ (161,000)
------------ ----------- -----------
------------ ----------- -----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
REAL WORLD SOLUTIONS, INC
STATEMENT OF STOCKHOLDERS' DEFICIT
<TABLE>
<CAPTION>
SERIES A TOTAL
PREFERRED STOCK COMMON STOCK ACCUMULATED STOCKHOLDERS'
SHARES AMOUNT SHARES AMOUNT DEFICIT DEFICIT
--------- --------- --------- -------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Balance at December 31, 1995 - $ - 2,000,000 $ 5,000 $ (8,000) $ (3,000)
Sale of preferred stock 550,000 709,000 - - - 709,000
Sale of Common Stock - - 200,000 40,000 - 40,000
Issuance of Common Stock upon
exercise of stock options - - 68,000 14,000 - 14,000
Net loss - - - - (889,000) (889,000)
--------- --------- --------- -------- ----------- ------------
Balance at December 31, 1996 550,000 709,000 2,268,000 59,000 (897,000) (129,000)
Net loss (unaudited) - - - - (219,000) (219,000)
--------- --------- --------- -------- ----------- ------------
Balance at March 31, 1997
(unaudited) 550,000 $ 709,000 2,268,000 $ 59,000 $(1,116,000) $ (348,000)
--------- --------- --------- -------- ----------- ------------
--------- --------- --------- -------- ----------- ------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
REAL WORLD SOLUTIONS, INC.
STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
YEAR ENDED THREE MONTHS THREE MONTHS
DECEMBER 31, ENDED MARCH 31, ENDED MARCH 31,
1996 1997 1996
(UNAUDITED) (UNAUDITED)
------------ --------------- ---------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (889,000) $ (219,000) $ (161,000)
Adjustments to reconcile net
income to net cash used in
operating activities:
Depreciation 31,000 14,000 3,000
Changes in assets and liabilities:
Accounts receivable 15,000 (14,000) 35,000
Prepaid expenses and other
current assets 3,000 - 1,000
Accounts payable 50,000 (20,000) (8,000)
Accrued expenses and other
current liabilities 4,000 (25,000) (17,000)
----------- ----------- -----------
Net cash used in operating activities (786,000) (264,000) (147,000)
Cash flows from investing activities:
Purchase of property and equipment (109,000) - (11,000)
Proceeds from sale-leaseback
of property and equipment 32,000 - -
----------- ----------- -----------
Net cash used in investing activities (77,000) - (11,000)
Cash flows from financing activities:
Principal payments under capital
leases obligations (12,000) (4,000) (3,000)
Net borrowings from line of credit 5,000 - -
Proceeds from bridge loan 110,000 300,000 -
Proceeds from preferred stock 709,000 - 709,000
Proceeds from Common Stock 54,000 - 41,000
----------- ----------- -----------
Net cash provided by financing activities 866,000 296,000 747,000
----------- ----------- -----------
Increase in cash and cash equivalents 3,000 32,000 589,000
Cash and cash equivalents at beginning
of period 1,000 4,000 1,000
----------- ----------- -----------
Cash and cash equivalents at end of period $ 4,000 $ 36,000 $ 590,000
----------- ----------- -----------
----------- ----------- -----------
SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION:
Interest paid $ 15,000 $ 5,000 $ 1,000
Income taxes paid $ 2,000 $ - $ -
SUPPLEMENTAL DISCLOSURE OF NON-CASH
TRANSACTIONS:
Capital lease obligations incurred
relating to the acquisition of equipment $ 58,000 $ - $ -
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
REAL WORLD SOLUTIONS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 _ THE COMPANY AND A SUMMARY OF ITS SIGNIFICANT ACCOUNTING POLICIES:
THE COMPANY
Real World Solutions, Inc. (the "Company") was incorporated in
California on January 31, 1994. The Company develops client server software
solutions.
USE OF ESTIMATES AND ASSUMPTIONS
The preparation of the consolidated financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from those
estimates.
REVENUE RECOGNITION
The Company recognizes revenue in accordance with the American Institute
of Certified Public Accountants' Statement of Position 91-1 on software
revenue recognition.
Revenue is comprised of license revenue and service revenue. License
revenue is derived from the sale of software licenses to end user customers.
Service revenue is derived from customer funded engineering services.
License revenue is recognized upon shipment of the software if no
significant obligation remains and collection of the resulting receivable is
deemed probable. Service revenue is generally recognized on the percentage
of completion method of accounting using the input method of costs incurred.
If the total estimated costs to complete a project exceed the total contract
amount, indicating a loss, the entire anticipated loss is recognized
immediately.
SOFTWARE DEVELOPMENT COSTS
Software development costs incurred prior to the establishment of
technological feasibility are included in research and development and are
expensed as incurred. The Company defines establishment of technological
feasibility as the completion of a working model. Software development costs
incurred subsequent to the establishment of technological feasibility through
the period of general market availability of the product are capitalized, if
material. To date, all software development costs have been expensed as
incurred.
PROPERTY AND EQUIPMENT
Property and equipment are stated at cost. Depreciation and amortization
is computed using the straight-line method over the estimated useful lives of
the assets, generally three to five years, or in the case of leased assets
the life of the lease, if shorter.
8
<PAGE>
STOCK-BASED COMPENSATION
The Company has adopted Statement of Financial Accounting Standards No.
123 ("FAS 123"). "Accounting for Stock-Based Compensation", which establishes
a fair value method of accounting for stock-based compensation plans, and
requires additional disclosures for those companies who elect not to adopt
the new method of accounting. The Company has elected to continue to measure
compensation costs using the intrinsic value method prescribed by APB Opinion
No. 25, "Accounting for Stock Issued to Employees" and to comply with the pro
forma disclosure requirements of FAS 123 (see note 6). As such, adoption of
FAS 123 has had no impact on the Company's financial statements.
INCOME TAXES
Income taxes are computed using the asset and liability method. Under
the asset and liability method, deferred income tax assets and liabilities
are determined based on the differences between the financial reporting and
tax bases of the assets and liabilities and are measured using the currently
enacted tax rates and laws.
CONCENTRATION OF CREDIT RISK
Financial instruments that potentially subject the Company to
significant concentrations of credit risk consist principally of cash and
trade accounts receivable. The Company places its cash in money market
accounts.
The Company's accounts receivable are derived primarily from consulting
contracts with system integrators. At December 31, 1996 one customer
accounted for the entire balance of accounts receivable. The Company has not
experienced any significant accounts receivable write-offs.
INTERIM RESULTS (UNAUDITED)
The accompanying balance sheet as of March 31, 1997, the statements of
operations and cash flows for the three months ended March 31, 1997 and 1996
and the statement of stockholders' equity for the three months ended March
31, 1997 are unaudited. In the opinion of management, these statements have
been prepared on the same basis as the audited financial statements and
include all adjustments, consisting only of normal recurring adjustments,
necessary for fair presentation of the results of interim periods. The data
disclosed in these financial statements and notes to the financial statements
at such date and for such periods are unaudited.
NOTE 2 _ BALANCE SHEET COMPONENTS:
Property and equipment, net:
DECEMBER 31
1996
-----------
Computer Equipment and Software $ 158,000
Furniture and Office Equipment 11,000
-----------
169,000
Less: accumulated depreciation and amortization (37,000)
-----------
$ 132,000
-----------
-----------
At December 31, 1996 the company had $92,000 of computer and office equipment
under capital leases and accumulated amortization of $27,000.
Accrued liabilities:
DECEMBER 31
1996
-----------
Legal fees payable $ 24,000
Other accrued liabilities 7,000
-----------
$ 31,000
-----------
-----------
9
<PAGE>
NOTE 3 _ LINE OF CREDIT
The Company has an unsecured line of credit with a bank, which provides for
borrowings of up to $15,000. Borrowings bear interest at the bank's prime
rate plus 6.75% (15% at December 1996). As of December 31, 1996 there were
borrowings outstanding of approximately $14,000.
NOTE 4 _ NOTES PAYABLE
In October 1996, the Company entered into an agreement with certain investors
whereby the investors agreed to provide bridge financing to assist the
Company's cash flow prior to the Company effecting an equity financing of
approximately $1,000,000. The terms provide for exchange, by the investors
of the bridge financing, for equity interests with terms substantially
identical to those in the financing. In the event the Company does not close
the financing before July 1, 1997 the bridge loan shall be invested in the
Company's preferred stock at $1.29 per share with terms and conditions
similar to existing Series A stockholders (see note 5).
In January 1997, the Company received $300,000 from a venture capital fund
secured by a promissory note bearing interest at 10% per year, repayable in
full on May 30, 1997. This note is secured by a security interest in all the
assets of the Company. The Company subsequently obtained a release from the
terms of the notes which extended the financing through the period up to the
sale of the assets of the Company. See note 10 on subsequent events.
NOTE 5 _STOCKHOLDERS' EQUITY
CONVERTIBLE PREFERRED STOCK
The Board of Directors is authorized to issue an aggregate of 5,000,000
shares of preferred stock, of which 550,000 have been designated "Series A".
In 1996 the company issued 550,000 shares of Series A. The rights,
preferences, privileges and restrictions thereof are set forth in the
Company's Amended and Restated Articles of Incorporation, and are summarized
as follows:
Each share of Series A is convertible at the option of the holder into one
share of Common Stock, subject to certain adjustments, as defined in the
articles of incorporation, which provides for dilution protection. The
Series A will automatically convert into shares of Common Stock upon the
effective date of a public offering of Common Stock or if at least two-thirds
of the holders of the outstanding shares of the Preferred Stock vote to
effect such a conversion.
In the event of liquidation, the holders of Series A are entitled to receive
an amount equal to their original issue price of $1.29 per share for each
share of Series A held. In the event funds are sufficient to permit the
payment to such holders of the full preferential amount, then the entire
assets and property of the corporation shall be distributed ratably among the
holders of the Series A and the Common Stock based on the number of shares of
Common Stock held by each, assuming full conversion of shares of Series A
into Common Stock.
NOTE 6 _ STOCK OPTION PLAN
In 1996 the Board of Directors adopted the 1996 Stock Option Plan (the
"Plan") which provides for granting of incentive stock options and
nonstatutory stock options to employees, officers, directors and consultants
of the Company of up to 1,000,000 shares of Common Stock. In accordance with
the Plan, the stated exercise price shall not be less than 100% and 85% of
the estimated fair market value of Common Stock, as determined by the Board
of Directors, on the date of grant for incentive stock options and
nonstatutory stock options, respectively. Options granted to a stockholder
who owns more than 10% of the outstanding stock of the Company at the time of
grant must be at an exercise price not less than (i) 100% of the fair market
value of the stock on the date of grant in the case of incentive stock
options and (ii) 110% of the fair value of the stock on the date of grant in
the case of nonstatutory stock options. Prior to the formation of the Plan,
the Board of Directors granted 348,000 options outside the Plan.
10
<PAGE>
Options granted prior to formation of the Plan generally vested at the date
of grant and options granted under the Plan generally vest over a three-year
period. All options expire over terms not exceeding 10 years. At December
31, 1996, 325,000 options to purchase shares of Common Stock were
exercisable.
The following table summarizes the Company's option activity:
WEIGHTED
AVERAGE
OPTIONS EXERCISE
OUTSTANDING PRICE
Outstanding at December 31, 1995 348,000 $ 0.06
Options granted 464,000 $ 0.20
Options exercised (68,000) $ 0.20
Options canceled (68,000) $ 0.16
-------
Outstanding at December 31, 1996 676,000 $ 0.13
-------
-------
The weighted average grant date fair value of options, as computed under the
Black-Scholes option valuation model, granted in 1995 and 1996 was $0.02 and
$0.03 respectively. The fair value of each option grant is estimated on the
date of grant using the minimum value method with the following
weighted-average assumptions used for grants in 1996 and 1995: risk free
interest rates of 6.05% and 6.2%, respectively and expected lives of three
years. The company has never declared or paid a dividend; therefore, no
dividend yield has been assumed.
<TABLE>
<CAPTION>
OPTIONS OUTSTANDING OPTIONS EXERCISABLE
NUMBER NUMBER
OUTSTANDING AT WEIGHTED-AVERAGE WEIGHTED- EXERCISABLE AT WEIGHTED-
DECEMBER 31, REMAINING AVERAGE DECEMBER 31, AVERAGE
EXERCISE PRICES 1996 CONTRACTUAL LIFE EXERCISE PRICE 1996 EXERCISE PRICE
<S> <C> <C> <C> <C> <C>
$ 0.05 300,000 8.0 $ 0.05 300,000 $ 0.05
$ 0.10 24,000 8.8 0.10 18,000 0.10
$ 0.20 352,000 9.3 0.20 7,000 0.20
------- -------
Total 676,000 8.7 0.13 325,000 0.06
------- -------
------- -------
</TABLE>
The Company applies the measurement principles of APB No. 25 in accounting
for its stock option plan. Had compensation cost for options granted in 1996
been determined based on the fair market value at the grant dates as
prescribed by Statement of Financial Accounting Standards No. 123 (FAS 123),
the Company's net loss would have been as follows:
YEAR ENDED
DECEMBER 31,
1996
-------------
Net loss
As reported $ (889,000)
Pro forma (894,000)
Because the method of accounting prescribed by FAS 123 has not been applied
to options granted prior to January 1, 1995, and because the Black-Scholes
option valuation model was developed for traded options and requires the
input of subjective assumptions, the resulting pro-forma compensation cost
may not be representative of that to be expected in future years.
11
<PAGE>
NOTE 7 _ COMMITMENTS
The Company leases certain computer equipment and office equipment under
long-term lease agreements that are classified as capital leases. The leases
expire over the next five years and include options to purchase the equipment
at the end of the lease terms.
The Company leases its facilities under an operating lease that expires in
November 1997.
Future minimum lease payments, at December 31, 1996 were as follows (in
thousands):
Capital Operating
Leases Leases
------- ---------
Year ending December 31,
1997 $ 35,000 $ 26,000
1998 31,000 -
1999 21,000 -
2000 15,000 -
2001 10,000 -
--------- ---------
Total minimum lease payments 112,000 $ 26,000
Less amount representing interest (43,000) ---------
--------- ---------
Present value of future minimum
lease payments 69,000
Less current portion of capital
lease payments (18,000)
---------
Long-term capital lease obligations $ 51,000
---------
---------
Total rent expense was approximately $28,000, for the year ended December 31,
1996.
NOTE 8 _ INCOME TAXES
No provision for federal or state income taxes has been recorded for the
year ended December 31, 1996 as the company has incurred net operating losses.
Deferred tax assets are summarized as follows:
Net operating loss carryforward $ 282,000
Research and development credit carryforward 28,000
---------
Total deferred tax assets 310,000
Less: valuation allowance (310,000)
---------
$ -
---------
---------
Management believes that, based on a number of factors, the available
objective evidence creates sufficient uncertainty regarding the realizability
of the deferred tax assets such that a full valuation allowance has been
recorded. These factors include the Company's history of losses, recent
increases in expense levels, the fact that the market in which the Company
competes is intensely competitive and characterized by rapidly changing
technology, the lack of carryback capacity to realize deferred tax assets,
and the uncertainty regarding market acceptance of the company's products.
Based on the currently available evidence, management is unable to assert
that it is more likely than not that the Company will generate sufficient
taxable income to realize the Company's deferred tax assets. The Company
will continue to assess the realizability of the deferred tax assets based on
actual and forecasted operating results.
At December 31, 1996, the Company had net operating loss carryforwards for
federal income tax purposes of approximately $829,000 which expire through
the year 2011.
Under the Tax Reform Act of 1986, the amount of and the benefit from net
operating losses that can be carried forward may be impaired in certain
circumstances. Events which may cause changes in the Company's tax
carryforwards include, but are not limited to, a cumulative ownership change
of more than 50% over a three year period.
12
<PAGE>
NOTE 9 _ RELATED PARTIES
The legal firm representing the Company has also been an investor in the
Company including providing bridge financing to the Company in 1996. Total
legal expenses incurred in 1996 were approximately $42,000.
NOTE 10 _ SUBSEQUENT EVENTS
On July 16, 1997, Puma Technology, Inc. (Puma) purchased the assets and
assumed all the liabilities of the Company. The consideration to the Company
for the sale of the assets to Puma was the assumption of certain liabilities
of approximately $801,000 and cash consideration of $205,000.
13
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and
Stockholders of Real World Solutions, Inc.
In our opinion, the accompanying consolidated balance sheet and the related
statements of operations, of stockholders' deficit and of cash flows present
fairly, in all material respects, the financial position of Real World
Solutions, Inc. at December 3l, 1996, and the results of its operations and
its cash flows for the year in conformity with generally accepted accounting
principles. 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 of these
statements in accordance with generally accepted auditing standards which
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, assessing the accounting
principles used and significant estimates made by management, and evaluating
the overall financial statement presentation. We believe that our audit
provides a reasonable basis for the opinion expressed above.
Price Waterhouse LLP
San Jose, California
September 25, 1997
14
<PAGE>
(b) PRO FORMA FINANCIAL INFORMATION.
The unaudited pro forma financial statements of Puma Technology, Inc.
for the year ended July 31, 1996 and nine months ended April 30, 1997 are
filed as part of this Current Report on Form 8-K.
The following pro forma combined condensed financial statements give effect
to the Acquisition under the purchase method of accounting. The pro forma
combined condensed balance sheet assumes the Acquisition took place on April
30, 1997 and combines Puma's April 30, 1997 unaudited condensed consolidated
balance sheet with RWS' unaudited historical condensed balance sheet at March
31, 1997. The pro forma combined condensed statements of operations assume
that the Acquisition took place as of the beginning of each of the periods
presented and combine Puma's condensed consolidated statement of operations
for the year ended July 31, 1996 and Puma's unaudited condensed consolidated
statement of operations for the nine months ended April 30, 1997 with the
unaudited condensed statement of operations of RWS for the twelve-month
period ended June 30, 1996 and the unaudited condensed statement of
operations of RWS for the nine months ended March 31, 1997.
The charge of $880,000 resulting from the purchased in-process research and
development costs has been reflected in stockholders equity in the pro forma
combined condensed balance sheet at April 30, 1997. However, this charge has
been excluded from the pro forma combined condensed statement of operations
for the year ended July 31, 1996 and the nine months ended April 30, 1997.
The pro forma information is presented for illustrative purposes only and is
not necessarily indicative of operating results or financial position that
would have occurred if the Acquisition had been consummated as of the dates
indicated, nor is it necessarily indicative of future operating results or
financial position.
15
<PAGE>
PUMA AND RWS
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
(in thousands)
ASSETS
<TABLE>
<CAPTION>
PUMA RWS
---- ---
APRIL 30, MARCH 31, PRO
FORMA
1997 1997 ADJUSTMENTS (1) BALANCES
----------- ----------- ------------------------------
<S> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 5,537 $ 36 $ (975) (a) $ 4,598
Short-term investments 18,514 - - 18,514
Accounts receivable, net 3,066 34 (34) (b) 3,066
Inventories 179 - - 179
Prepaid expenses and other current assets 382 1 (1) (b) 382
--------- -------- --------- --------
Total current assets 27,678 71 (1,010) 26,739
Property and equipment, net 1,069 118 (50) (c) 1,137
Other assets 453 3 53 (b) 509
--------- -------- --------- --------
Total assets $ 29,200 $ 192 $ (1,007) $ 28,385
--------- -------- --------- --------
--------- -------- --------- --------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Line of credit $ - $ 14 $ (14) (d) $ -
Accounts payable 764 45 (45) (d) 764
Accrued expenses and other current
liabilities 952 6 (6) (d) 952
Notes payable - 410 (410) (d) -
Deferred revenue 727 - - 727
Current portion of capital
lease obligations 11 18 - (e) 29
--------- -------- --------- --------
Total current liabilities 2,454 493 (475) 2,472
Capital lease obligations, net
of current portion 13 47 - (e) 60
--------- -------- --------- --------
Total liabilities 2,467 540 (475) 2,532
Stockholders' equity (deficit) 26,733 (348) (532) (f) 25,853
--------- -------- --------- --------
Total liabilities and
stockholders' equity (deficit) $ 29,200 $ 192 $ (1,007) $ 28,385
--------- -------- --------- --------
--------- -------- --------- --------
</TABLE>
See accompanying notes
16
<PAGE>
PUMA AND RWS
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
(in thousands, except per share data)
<TABLE>
<CAPTION>
PUMA RWS
---- ---
YEAR ENDED 12 MONTHS
JULY 31, ENDED JUNE 30, PRO FORMA
1996 1996 ADJUSTMENTS (2) BALANCES
---------- -------------- ----------------------------
<S> <C> <C> <C> <C>
Revenue $ 7,716 $ 172 $ - $ 7,888
Cost of revenue 673 107 - 780
-------- ------- ------- --------
Gross profit 7,043 65 - 7,108
Operating expenses:
Research and Development 3,107 143 3,250
Selling, general and
Administrative 3,233 375 28 (a) 3,636
In-process research and
development 2,680 - - 2,680
-------- ------- ------- --------
Total operating expenses 9,020 518 28 9,566
-------- ------- ------- --------
Loss from operations (1,977) (453) (28) (2,458)
Other income (expense), net 85 (4) (60) (b) 21
-------- ------- ------- --------
Loss before income taxes (1,892) (457) (88) (2,437)
Provision for income taxes 509 - - 509
-------- ------- ------- --------
Net loss $ (2,401) $ (457) $ (88) $ (2,946)
-------- ------- ------- --------
-------- ------- ------- --------
Net loss per share $ (0.25) $ - $ - $ (0.31)
Shares used in per share
calculation 9,474 - - 9,474
</TABLE>
See accompanying notes
17
<PAGE>
PUMA AND RWS
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
(in thousands, except per share data)
<TABLE>
<CAPTION>
PUMA RWS
---- ---
NINE MONTHS NINE MONTHS
ENDED APRIL 30, ENDED MARCH 31, PRO FORMA
1997 1997 ADJUSTMENTS (2) BALANCES
--------------- --------------- -------------------------------
<S> <C> <C> <C> <C>
Revenue $ 11,151 $ 98 $ - $ 11,249
Cost of revenue 1,186 50 - 1,236
---------- --------- -------- ---------
Gross profit 9,965 48 - 10,013
Operating expenses:
Research and development 4,240 246 4,486
Selling, general and administrative 4,196 420 (a) 4,637
---------- --------- -------- ---------
Total operating expenses 8,436 666 21 9,123
---------- --------- -------- ---------
Income (loss) from operations 1,529 (618) (21) 890
Other income (expense), net 486 (17) (45) (b) 424
---------- --------- -------- ---------
Income (loss) before income taxes 2,015 (635) (66) 1,314
Provision for income taxes 706 - - 706
---------- --------- -------- ---------
Net income (loss) $ 1,309 $ (635) $ (66) $ 608
---------- --------- -------- ---------
---------- --------- -------- ---------
Net income per share $ 0.11 $ - $ - $ 0.05
Shares used in per share calculation 11,579 - - 11,579
</TABLE>
See accompanying notes
18
<PAGE>
PUMA AND RWS
NOTES TO UNAUDITED PRO FORMA FINANCIAL INFORMATION
1. The Puma Technology, Inc. ("Puma") pro forma combined condensed balance
sheet reflects the completion of the acquisition of Real World
Solutions, Inc. ("RWS") on April 30, 1997 and combines Puma's April 30,
1997 unaudited condensed consolidated balance sheet with RWS' unaudited
condensed balance sheet at March 31, 1997. The pro forma adjustments
reflect the allocation of the purchase price among identifiable tangible
and intangible assets acquired and certain liabilities assumed which was
based on an analysis of the fair values of those assets and liabilities.
(a) Reflects cash used in acquisition and repayment by Puma of certain
liabilities assumed.
(b) Accounts receivable, prepaid and other assets were not acquired by
Puma.
(c) Reflects adjustment to fair market value of property and equipment
acquired.
(d) Reflects repayment by Puma of RWS' line of credit, accounts payable,
accrued expenses and notes payable which were assumed by Puma.
(e) Reflects liabilities assumed but not immediately paid off by Puma.
(f) Reflects the elimination of RWS' accumulated deficit and the recording
by Puma of the purchased in-process research and development.
2. The unaudited pro forma combined condensed statements of operations
assume that the acquisition took place as of the beginning of each of
the periods presented. The unaudited pro forma combined condensed
statement of operations for the year ended July 31, 1996 combines Puma's
condensed consolidated statement of operations for the year ended July
31, 1996 with RWS' unaudited condensed statement of operations for the
twelve months ended June 30, 1996. The unaudited pro forma combined
condensed statement of operations for the nine months ended April 30,
1997 combines Puma's unaudited condensed consolidated statement of
operations for the nine months ended April 30, 1997 with RWS' unaudited
condensed statement of operations for the nine months ended March 30,
1997. The unaudited pro forma combined condensed statements of
operations for the year ended July 31, 1996 and the nine months ended
April 30, 1997 do not include the $880,000 write-off of purchased
in-process research and development as it is a material non-recurring
charge. It will be included in the actual consolidated statement of
operations of Puma in the quarter ended July 31, 1997.
(a) Reflects the amortization of purchased intangible assets (principally
purchased workforce in place). The amortization of purchased
intangible assets is based on a two year economic life of those
assets.
(b) Reflects the reduction of interest income on cash used in the
acquisition.
(c) EXHIBITS.
None
19
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Puma Technology, Inc.
Date September 26, 1997 By: /s/ M. Bruce Nakao
-------------------------
M. Bruce Nakao
Sr. Vice President and
Chief Financial Officer
20
