<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999 OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _________ TO __________
COMMISSION FILE NUMBER: 000-23889
---------------
BRIGHTSTAR INFORMATION TECHNOLOGY GROUP, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
DELAWARE 76-0553110
(STATE OF OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
4900 HOPYARD ROAD, SUITE 200
PLEASANTON, CALIFORNIA 94566
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (925) 251-0000
---------------
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ].
The number of shares of Common Stock of the Registrant, par value $.001 per
share, outstanding at November 12, 1999, was 8,642,034.
* The Registrant became subject to the reporting requirements of Section 13
of the Securities Exchange Act of 1934 on April 16, 1998.
<PAGE> 2
ITEM 1. FINANCIAL STATEMENTS
BRIGHTSTAR INFORMATION TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(000'S, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1999 1998
------------- ------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 2,406 $ 3,672
Trade accounts receivable, net
of allowance for doubtful accounts
of $1,692 and $1,316 24,735 20,297
Unbilled revenue 3,423 2,238
Deferred tax asset 991 785
Prepaid expenses and other 1,874 1,298
--------- ---------
Total current assets 33,429 28,290
PROPERTY AND EQUIPMENT 7,479 5,051
Less-accumulated depreciation (2,798) (1,505)
--------- ---------
Property and equipment, net 4,681 3,546
GOODWILL 64,372 62,260
Less-accumulated amortization (2,237) (1,030)
--------- ---------
Goodwill, net 62,135 61,230
OTHER 183 498
--------- ---------
TOTAL $ 100,428 $ 93,564
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 5,615 $ 3,920
Acquisition payable 500 4,784
Line of credit 10,910 --
Current maturities of capital lease
obligations 156 167
Restructuring reserve 2,763 4,383
Accrued salaries and other expenses 7,698 6,328
Income taxes payable 295 1,791
Deferred revenue 361 1,936
--------- ---------
Total current liabilities 28,298 23,309
NOTE PAYABLE 500 --
LONG-TERM CAPITAL LEASES, NET 40 129
OTHER 34 52
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, $0.001; 35,000,000 shares
authorized; 8,642,034 and 7,989,059
shares issued and outstanding 8 8
Additional paid-in capital 84,393 82,818
Common stock payable 6,300 6,875
Common stock warrants 100 100
Deferred stock compensation -- (468)
Accumulated other comprehensive income 151 248
Retained earnings (deficit) (19,396) (19,507)
--------- ---------
Total stockholders' equity 71,556 70,074
--------- ---------
TOTAL $ 100,428 $ 93,564
========= =========
</TABLE>
See notes to condensed consolidated financial statements
<PAGE> 3
BRIGHTSTAR INFORMATION TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(000'S, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
------------------------------- -------------------------------
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
1999 1998 1999 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
REVENUE $ 33,046 $ 26,738 $ 101,648 $ 50,404
COST OF REVENUE 25,214 19,505 75,014 36,376
----------- ----------- ----------- -----------
GROSS PROFIT 7,832 7,233 26,634 14,028
OPERATING EXPENSES:
Selling, general and administrative expenses 6,814 5,337 23,013 9,934
Stock compensation expense -- 1,896 468 3,159
In-process research & development costs -- -- -- 3,000
Goodwill amortization 409 330 1,207 525
Depreciation and amortization 491 313 1,293 555
----------- ----------- ----------- -----------
Total operating expenses 7,714 7,876 25,981 17,173
INCOME (LOSS) FROM OPERATIONS 118 (643) 653 (3,145)
OTHER INCOME (EXPENSE) 1 95 (31) 229
INTEREST EXPENSE (234) (7) (312) (68)
----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES (115) (555) 310 (2,984)
INCOME TAX PROVISION (CREDIT) (480) 563 199 1,256
----------- ----------- ----------- -----------
NET INCOME (LOSS) $ 365 $ (1,118) $ 111 $ (4,240)
=========== =========== =========== ===========
Net income (loss) per share -
Basic and Diluted $ 0.04 $ (0.13) $ 0.01 $ (0.76)
=========== =========== =========== ===========
Weighted average shares outstanding -
Basic 8,897,217 8,442,305 8,755,448 5,552,696
=========== =========== =========== ===========
Diluted 8,897,217 8,456,920 8,755,448 5,572,954
=========== =========== =========== ===========
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE> 4
BRIGHTSTAR INFORMATION TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(OOO'S)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1999 1998
------------- -------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income (loss) $ 111 $ (4,241)
Adjustments to reconcile net loss to net cash
used in operating activities:
Cumulative translation adjustment (97) (9)
Depreciation and amortization 2,500 1,080
Additions to allowance for doubtful accounts 376 447
In-process research & development costs -- 3,000
Compensation expense on issuance of common stock 468 3,160
Deferred taxes (206) --
Cash provided by (used in) operating working capital:
Trade accounts receivable (4,814) (6,184)
Unbilled revenue (1,185) 102
Prepaid expenses and other (279) (825)
Accounts payable 1,695 183
Restructuring reserve (1,620) --
Accrued salaries and other expenses 1,370 (5,312)
Income taxes payable (1,496) 1,317
Deferred revenue (1,575) --
-------- --------
Net cash used in operating activities (4,752) (7,282)
INVESTING ACTIVITIES:
Cash paid to acquire founding companies -- (41,891)
Payments for acquisitions (4,896) (1,157)
Additions of property and equipment, net of disposals (2,428) (710)
-------- --------
Net cash used by investing activities (7,324) (43,758)
FINANCING ACTIVITIES:
Payments on short-term debt and notes payable -- (1,211)
Net proceeds from issuance of common stock -- 59,090
Borrowings under line of credit 10,910 (175)
Net payments on capital lease obligations (100) (182)
-------- --------
Net cash provided by financing activities 10,810 57,522
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (1,266) 6,482
CASH AND CASH EQUIVALENTS:
Beginning of period 3,672 3
-------- --------
End of period $ 2,406 $ 6,485
======== ========
SUPPLEMENTAL DISCLOSURE:
Noncash issuance of common stock of fair value $ 1,575 $ --
======== ========
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE> 5
BRIGHTSTAR INFORMATION TECHNOLOGY GROUP, INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and the instructions to Form 10-Q and Article
10 of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. The consolidated financial statements for the
three and nine month periods ended September 30, 1999 and the balance sheet
at December 31, 1998 include the accounts of all BrightStar subsidiaries. The
statement of operations and cash flows for the nine month period ended
September 30, 1998 include only the accounts of Brian R. Blackmarr and
Associates, Inc, the accounting acquirer, from January 1, 1998 to April 17,
1998, the date of acquisition. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included in the financial statements. Operating
results for the three and nine month periods ended September 30, 1999, are
not necessarily indicative of the results that may be expected for the year
ending December 31, 1999. The balance sheet at December 31, 1998, has been
derived from the audited financial statements at that date but does not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. For additional
information, refer to financial statements and footnotes thereto included in
the Company's annual report on Form 10-K for the year ended December 31,
1998.
Certain reclassifications have been made to conform the prior year's
financial statement amounts to the current year presentation. Additionally,
certain costs and expenses amounting to $0.9 million and $1.5 million,
respectively, for the three and six month periods ended June 30, 1998 and
$1.4 million for the three month period ended March 31, 1999 that were
previously included in cost of revenue have been reclassified to selling,
general and administrative expenses.
2. CREDIT FACILITY
Effective March 29, 1999, the Company established a $15 million credit
facility (the "Credit Facility") with Comerica Bank. Under terms of the
agreement, the Credit Facility will be used for working capital needs,
including issuance of letters of credit, and for general corporate purposes.
Borrowings under the Credit Facility bear an interest rate of prime plus
.25%, or the Eurodollar rate plus 2.5%. The Company will pay a commitment fee
on unused amounts of the Credit Facility amounting to .375% per annum based
on the average daily amount by which the commitment amount exceeds the
principal amount outstanding during the preceding month. Interest is payable
monthly on prime rate borrowings and quarterly or at the end of the
applicable interest period for the Eurodollar rate borrowings.
The Credit Facility is secured by liens on substantially all the Company's
assets (including accounts receivable) and a pledge of all of the outstanding
capital stock of the Company's domestic operating subsidiaries. The Credit
Facility also requires that the Company comply with various loan covenants,
including (i) maintenance of certain financial ratios, (ii) restrictions on
additional indebtedness and (iii) restrictions on liens, guarantees and
payments of dividends. As of, and during the quarter ended September 30,
1999, the Company was not in compliance with a certain financial covenant.
Comerica Bank has agreed to waive the default.
The Credit Facility contains provisions requiring mandatory prepayment of
outstanding borrowings from the issuance of debt or equity securities for
cash, excluding certain equity issued in connection with future acquisitions,
and cash realized in connection with permitted asset sales outside of the
ordinary course of business. Borrowings outstanding under the Credit Facility
amounted to $10.8 million at September 30, 1999 at an interest rate of 8.25%.
The Credit Facility expires on March 30, 2001.
3. RESTRUCTURING
During the fourth quarter of 1998, the Company announced a plan to
restructure its operations and recorded a charge of $7.6 million. The plan
included a reorganization of operations, relocation of the Company's
corporate office, reduction in workforce, and termination of leases and other
contractual obligations.
<PAGE> 6
The major categories of the restructuring charge are summarized below (000's
omitted):
<TABLE>
<CAPTION>
REMAINING
AMOUNTS CHARGED AMOUNTS ACCRUED
TO EARNINGS IN 1998 AT SEPTEMBER 30, 1999
------------------- ---------------------
<S> <C> <C>
Workforce severance obligations $4,960 $1,813
Asset writedowns 1,171 --
Lease and other contract obligations 1,483 950
------ ------
Total $7,614 $2,763
====== ======
</TABLE>
The balance of the restructuring charge will be utilized through the first
quarter of 2001.
4. INCOME TAXES
The provision for income taxes for the nine month period ended September 30,
1999 is based on an estimated effective tax rate of 39%, adjusted for
non-deductible goodwill amortization and stock compensation expense.
Additionally, the provision for income taxes reflects a third quarter
reduction in the deferred tax asset valuation allowance of $0.6 million,
based upon the estimated utilization of the underlying tax assets. Components
of net deferred tax assets of $1.0 million at September 30, 1999 principally
relate to the Company's accounts receivable and restructuring reserves.
5. COMPREHENSIVE INCOME
SFAS No. 130, "Reporting Comprehensive Income," requires companies to report
and display comprehensive income and its components in the financial
statements. Comprehensive income includes all changes in equity during a
period except those resulting from investment by owners and distributions to
owners. Due to the effect of the cumulative foreign currency translation
adjustment, comprehensive income was $0.1 million less than net income
reported for the nine months ended September 30, 1999. Comprehensive income
is the same as net income reported in the 1998 period reported.
6. ACQUISITION
On May 28, 1999, the Company purchased Integrated Systems Consultants, LLC
("ISC") pursuant to an Asset Purchase Agreement (the "Agreement"), dated as
of April 1, 1999. ISC is a provider of SAP consulting services based in
Phoenix, Arizona. The four principals of ISC each have over five years
experience leading and completing SAP implementations for mid-tier and large
global enterprises. The ISC customers include Microsoft, Arch Chemicals and
the Tessenderlo Group as well as other companies in the high tech, chemical
and manufacturing industries.
The aggregate consideration for this transaction was $3.0 million; of which
$500,000 was paid in cash upon closing; $1,000,000 will be paid on June 1,
2000 in up to 255,183 shares of common stock, or a combination of cash and
stock as defined in the Agreement; $500,000 was financed by a Convertible
Subordinated Promissory Note due August 1, 2000; and, the remaining
$1,000,000 contingent consideration will be paid subject to the achievement
of ISC earnings during the twelve months ending March 31, 2000, as defined in
the Agreement. The Company has allocated the entire purchase price and
certain other acquisition costs to goodwill.
7. CONTINGENT LIABILITY
Under the terms of the acquisition of Cogent Technologies, LLC ("Cogent"),
the Company is required, as additional consideration for the acquisition, to
make an additional cash payment and issue additional shares of the Company's
common stock to the prior owners based upon an earn-out calculation. The
additional purchase consideration will be recorded as goodwill upon transfer.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
INTRODUCTION - BrightStar provides enterprise-wide business and technology
solutions to Global 2000 companies and other large organizations. BrightStar
provides these services to a diverse client base including but not limited to
retail, industrial, petrochemical, manufacturing and distribution companies
and governmental agencies.
The Company's services and products include Enterprise Resource Planning
(ERP) software implementation, consulting, software
<PAGE> 7
and Web application development, systems integration and outsourcing, and
training as well as upgrades and support related to software products. The
services are generally performed at clients' locations and also at the
Company's facilities. In providing ERP implementation and other IT services,
the Company may assume responsibility for project management and bill the
client on a time and material or fixed fee basis.
Revenue is recognized as services are rendered. The timing of revenue is
difficult to forecast because the Company's sales cycle for certain of its
services can be relatively long and is subject to a number of uncertainties,
including clients' budgetary constraints, the timing of clients' budget
cycles, clients' internal approval processes and general economic conditions.
In addition, as is customary in the industry, the Company's engagements,
generally, are terminable without a client penalty. The Companies' revenue
and results of operations may fluctuate significantly from quarter to quarter
or year to year because of a number of factors, including, but not limited
to, the effect of changes in estimates to complete fixed fee contracts; the
rate of hiring and the productivity of revenue generating personnel; the
availability of qualified IT professionals; the significance of client
engagements commenced and completed during a quarter; the number of business
days in the quarter; changes in the relative mix of the Company's services;
changes in the pricing of the Company's services; the timing and the rate of
entrance into new geographic or IT specialty markets; departures or temporary
absences of key revenue-generating personnel; the structure and timing of
acquisitions; changes in the demand for IT services; and general economic
factors.
Cost of revenue consists primarily of salaries (including non-billable and
training time) and benefits for consultants. The Company generally strives to
maintain its gross profit margins by offsetting increases in salaries and
benefits with increases in billing rates.
Selling, general and administrative expenses primarily consist of costs
associated with (i) corporate overhead, (ii) sales and account management,
(iii) telecommunications, (iv) human resources, (v) recruiting and training.
RESULTS OF OPERATIONS
Financial results for the three and nine month periods ended September 30,
1999 include the operations of all BrightStar companies acquired in
conjunction with, or subsequent to the date of the IPO. Financial results for
the nine months ended September 30, 1998 contain only the operations of
Blackmarr, the accounting acquirer from January 1, 1998 to April 17, 1998,
the date of acquisition. Consequently, variances between nine month periods
reflect the combined operations of the BrightStar companies from April 17,
1998, which was the date BrightStar commenced operations, or later dates for
companies subsequently acquired. The information herein should be read in
conjunction with financial and pro forma information contained in the
Company's 1998 Annual Report on Form 10-K.
Revenue increased primarily due to new ERP contracts, additional custom and
web application development projects and business related to acquired
entities.
Cost of revenue increased in proportion to the additional ERP and custom
application development revenue. Cost of revenue as a percentage of revenue
for the three and nine months ended September 30, 1999 was higher than normal
as a result of consultant salaries and related costs attributable to certain
fixed fee contracts that are not billable at normal rates and competitive
pricing pressures. During the three and nine month periods ending September
30, 1999, the Company recorded losses amounting to $1.2 million and $1.7
million, respectively, related to two fixed fee projects which originated
prior to 1999.
The increase in selling, general and administrative expenses reflect the
Company's investment in building its internal infrastructure and field sales
force.
Stock compensation is a non-cash expense item related to the issuance of
stock to certain Founders as a part of the IPO. This amount was amortized
over a period of 12 months.
Goodwill amortization relates to goodwill acquired in conjunction with the
IPO and subsequent acquisitions.
Income taxes are based on the Company's estimated annual tax rate of 39%,
adjusted for non-deductible goodwill amortization and stock compensation
expense. Additionally, during the third quarter, the Company reduced the
deferred tax asset valuation allowance by $0.6 million based upon estimated
utilization of the underlying deferred tax assets.
<PAGE> 8
LIQUIDITY AND CAPITAL RESOURCES
Effective March 29, 1999, the Company established a $15 million credit
facility (the "Credit Facility") with Comerica Bank. Under terms of the
agreement, the Credit Facility will be used for working capital needs,
including issuance of letters of credit, and for general corporate purposes.
Borrowings under the Credit Facility bear an interest rate of prime plus
.25%, or the Eurodollar rate plus 2.5%. The Company will pay a commitment fee
on unused amounts of the Credit Facility amounting to a .375% per annum based
on the average daily amount by which the commitment amount exceeds the
principal amount outstanding during the preceding month. Interest is payable
monthly on prime rate borrowings and quarterly or at the end of the
applicable interest period for the Eurodollar rate borrowings.
The Credit Facility is secured by liens on substantially all the Company's
assets (including accounts receivable) and a pledge of all of the outstanding
capital stock of the Company's domestic operating subsidiaries. The Credit
Facility also requires that the Company comply with various loan covenants,
including (i) maintenance of certain financial ratios, (ii) restrictions on
additional indebtedness and (iii) restrictions on liens, guarantees and
payments of dividends. As of, and during the quarter ended September 30,
1999, the Company was not in compliance with a certain financial covenant.
Comerica Bank has agreed to waive the default. The Credit Facility contains
provisions requiring mandatory prepayment of outstanding borrowings from the
issuance of debt or equity securities for cash, excluding certain equity
issued in connection with future acquisitions, and cash realized in
connection with permitted asset sales outside of the ordinary course of
business. The Credit Facility expires on March 30, 2001.
During the first half of 1999, the Company borrowed $10.8 million under its
Credit Facility to finance $3.5 million of additional working capital
requirements, $2.4 million of equipment additions and $4.9 million of
payments related to acquisitions.
The Company intends to continue to pursue acquisition opportunities. The
timing, size or success of any acquisition effort and the associated
potential capital commitments are unpredictable. The Company expects to fund
future acquisitions through the issuance of additional equity, as well as
through a combination of working capital, cash flow from operations, and
borrowings under the Credit Facility. Additionally, the Company intends to
divest its classroom training business in the fourth quarter of 1999.
The Company believes that cash flow from operations and borrowings under the
Credit Facility will be sufficient to fund its requirements over the next
twelve months.
YEAR 2000 COMPLIANCE - The inability of computers, software and other
equipment utilizing microprocessors to recognize and properly process data
fields containing a two-digit year is commonly referred to as the Year 2000
problem. The Year 2000 problem arises from the way dates are recorded and
computed in most applications, operating systems, hardware and embedded
chips. If the problem is not corrected a system that uses a date in its
prescribed function may fail or produce erroneous results before, on and
after the Year 2000.
The Company has completed a review of its businesses to determine whether or
not purchased and internally developed computer programs are Year 2000
compliant, as well as to determine the extent of any remedial action and
associated costs for such programs which are not compliant. Based upon its
review, the Company plans to complete all remediation efforts for its
critical systems prior to Year 2000. The Company is also contacting its key
suppliers and customers to determine their Year 2000 readiness in order to
ensure a steady flow of goods and services to the Company and continuity with
respect to customer service.
The costs of Year 2000 preparation for the Company's products are primarily
costs of existing internal resources largely absorbed within existing
spending levels. The costs of the readiness program for internal systems are
a combination of incremental external spending and use of existing internal
resources and expertise. The financial impact of the Year 2000 reviews,
modifications, testing, replacements or related purchases are not expected to
be material to the Company's business or its consolidated financial position,
results of operations or cash flows.
FORWARD-LOOKING INFORMATION - Management's Discussion and Analysis of
Financial Condition and Results of Operations ("MD&A") includes
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. All statements, other than statements of historical facts, included in
this MD&A regarding the Company's financial position, business strategy and
plans and objectives of management of the Company for future operations are
forward-looking statements. These forward-looking statements rely on a number
of assumptions concerning future events and are subject to a number of
uncertainties and other factors, many of which are outside of the Company's
control, that could cause actual results to materially differ from such
statements. While the Company believes that the assumptions
<PAGE> 9
concerning future events are reasonable, it cautions that there are inherent
difficulties in predicting certain important factors, especially the timing
and magnitude of technological advances; the performance of recently acquired
businesses; the prospects for future acquisitions; the possibility that a
current customer could be acquired or otherwise be affected by a future event
that would diminish their information technology requirements; the
competition in the information technology industry and the impact of such
competition on pricing, revenues and margins; the degree to which business
entities continue to outsource information technology and business processes;
uncertainties surrounding budget reductions or changes in funding priorities
or existing government programs and the cost of attracting and retaining
highly skilled personnel.
PART II - OTHER INFORMATION
ITEM 1. Legal proceedings
None.
ITEM 3. Defaults upon Senior Securities
See Note 2 to the Condensed Consolidated Financial Statements.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF STOCKHOLDERS
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
On June 14, 1999, the Company filed a report on Form 8-K describing its
acquisition of Integrated Systems Consultants pursuant to an Asset Purchase
Agreement dated as of April 1, 1999
<PAGE> 10
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
BRIGHTSTAR INFORMATION
TECHNOLOGY GROUP, INC.
Date: November 12, 1999. BY: /s/ Michael A. Ober
----------------------------------
Michael A. Ober
Chief Executive Officer
BY: /s/ Donald W. Rowley
----------------------------------
Donald W. Rowley
Chief Financial Officer
<PAGE> 11
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 2,406
<SECURITIES> 0
<RECEIVABLES> 24,735
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 33,429
<PP&E> 7,479
<DEPRECIATION> 2,798
<TOTAL-ASSETS> 100,428
<CURRENT-LIABILITIES> 28,298
<BONDS> 0
0
0
<COMMON> 8
<OTHER-SE> 71,548
<TOTAL-LIABILITY-AND-EQUITY> 100,428
<SALES> 101,648
<TOTAL-REVENUES> 101,648
<CGS> 75,014
<TOTAL-COSTS> 75,014
<OTHER-EXPENSES> 25,981
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 312
<INCOME-PRETAX> 310
<INCOME-TAX> 199
<INCOME-CONTINUING> 111
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 111
<EPS-BASIC> 0.01
<EPS-DILUTED> (0.01)
</TABLE>
