INTERCEPT GROUP INC
8-K/A, 1998-12-11
FUNCTIONS RELATED TO DEPOSITORY BANKING, NEC
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<PAGE>
 
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549
                               -----------------


                                  FORM 8-K/A
                                AMENDMENT NO. 1
                                        


                                CURRENT REPORT
                    PURSUANT TO SECTION 13 OR 15(D) OF THE
                        SECURITIES EXCHANGE ACT OF 1934



    Date of Report (Date of earliest event reported):    September 30, 1998
                                                       ----------------------



                           THE INTERCEPT GROUP, INC.
                           -------------------------
                           (Exact Name of Registrant
                         as Specified in its Charter)



         Georgia                01-14213              58-2237359
    -----------------          -----------         ------------------
    (State or Other           (Commission           (I.R.S. Employer
    Jurisdiction of           File Number)          Identification No.)
     Incorporation)





3150 Holcomb Bridge Road, Suite 200, Norcross, Georgia                 30071
- -----------------------------------------------------------------------------
   (Address of Principal Executive Offices)                        (Zip Code)



      Registrant's telephone number, including area code:  (770) 248-9600
                                                           --------------



                                      N/A
                    ------------------------------------  
         (Former Name or Former Address, if Changed Since Last Report)
<PAGE>
 
ITEM 7.     FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.


     The registrant hereby amends its report on Form 8-K filed on October 14,
1998 by deleting the text under Item 7 and replacing it with the following text.


(A)  FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.


     Included as Exhibits 99.2 hereto and incorporated herein by reference.


(B)  PRO FORMA FINANCIAL INFORMATION.


     Included as Exhibit 99.3 hereto and incorporated herein by reference.


(C)  EXHIBITS.



2.1  Asset Purchase Agreement dated September 30, 1998 by and between
     ProVesa, Inc., a wholly owned subsidiary of The InterCept Group, Inc.
     ("InterCept"), Mercantile Corporation ("Mercantile"), and Dale May.*


99.1 Press Release dated September 30, 1998.*



99.2 The following audited financial statements of Advance Data together
     with the report thereon by Arthur Andersen LLP:


     Balance Sheets as of December 31, 1996 and 1997 and July 31, 1998
     (unaudited). 

     Statements of Operations for the years ended December 31, 1996 and 1997 and
     the seven months ended July 31, 1998 (unaudited).

     Statements of Partners' Capital for the years ended December 31, 1996 and
     1997 and the seven months ended July 31, 1998 (unaudited).

     Statements of Cash Flows for the years ended December 31, 1996 and 1997 and
     the seven months ended July 31, 1998 (unaudited).

     Notes to Financial Statements.
<PAGE>
 
99.3 The following unaudited pro forma condensed consolidated financial
     statements of InterCept and Advance Data:
 
     Pro Forma Condensed Consolidated Statement of Operations for the year ended
     December 31, 1997.
     
     Pro Forma Condensed Consolidated Statement of Operations for the nine
     months ended September 30, 1998.

     Notes to Pro Forma Condensed Consolidated Financial Information.

 
- ---------
*Previously filed with the registrant's Current Report on Form 8-K filed 
 October 14, 1998.
<PAGE>
 
                                 SIGNATURES



  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.

                              THE INTERCEPT GROUP, INC.



                              By:   /s/ Scott R. Meyerhoff
                                    -----------------------------------------
                                    Scott R. Meyerhoff
                                    Chief Financial Officer


Dated:  December 11, 1998
<PAGE>
 
                                 EXHIBIT INDEX



Exhibit                                                                Page
- -------                                                                ----


2.1  Asset Purchase Agreement dated September 30, 1998 by and between 
     Provesa,Inc., a wholly owned subsidiary of The InterCept 
     Group, Inc. ("InterCept") Mercantile Corporation ("Mercantile"), 
     and Dale May.*


99.1 Press Release dated September 30, 1998.*

99.2 The following audited financial statements of Advance Data 
     together with the report thereon by Arthur Andersen LLP:

     Balance Sheets as of December 31, 1996 and 1997 and July 31, 1998
     (unaudited).

     Statements of Operations for the years ended December 31, 1996 
     and 1997 and the seven months ended July 31, 1998 (unaudited).

     Statements of Partners' Capital for the years ended December 31, 
     1996 and 1997 and the seven months ended July 31, 1998 (unaudited).

     Statements of Cash Flows for the years ended December 31, 1996 
     and 1997 and the seven months ended July 31, 1998 (unaudited).

     Notes to Financial Statements.

99.3 The following unaudited pro forma condensed consolidated financial
     statements of InterCept and Advance Data:

     Pro Forma Condensed Consolidated Statement of Operations for the 
     year ended December 31, 1997.


     Pro Forma Condensed Consolidated Statement of Operations for the nine
     months ended September 30, 1998.


     Notes to Pro Forma Condensed Consolidated Financial Information.

 
- ---------
*Previously filed with the registrant's Current Report on Form 8-K filed 
 October 14, 1998.

<PAGE>
 
                                                                    EXHIBIT 99.2

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Partners of Advance Data Partnership:

We have audited the accompanying balance sheets of ADVANCE DATA PARTNERSHIP (an
Arkansas general partnership) as of December 31, 1996 and 1997 and the related
statements of operations, partners' capital and cash flows for the years then
ended.  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 audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards 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.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Advance Data Partnership as of
December 31, 1996 and 1997 and the results of its operations and its cash flows
for the years then ended in conformity with generally accepted accounting
principles.

Atlanta, Georgia
November 20, 1998
<PAGE>
 
                            ADVANCE DATA PARTNERSHIP

                                 BALANCE SHEETS

            DECEMBER 31, 1996 AND 1997 AND JULY 31, 1998 (UNAUDITED)

                                    ASSETS

                                              1996        1997         1998
                                            --------    --------     --------
                                                                   (Unaudited)

CURRENT ASSETS:
 Cash                                       $116,697    $405,789     $244,672
 Accounts receivable                         122,005     137,488      142,835
 Other current assets                         12,140      10,324       28,533
                                            --------    --------     --------
       Total current assets                  250,842     553,601      416,040

PROPERTY AND EQUIPMENT, NET                  545,669     441,688      492,407
                                            --------    --------     --------
                                            $796,511    $995,289     $908,447
                                            ========    ========     ========

                       LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
 Current maturities of long-term debt       $175,000    $210,510     $      0
 Accounts payable                             99,791       6,789      246,186
                                            --------    --------     --------
       Total current liabilities             274,791     217,299      246,186

COMMITMENTS AND CONTINGENCIES

PARTNERS' CAPITAL                            521,720     777,990      662,261
                                            --------    --------     --------
                                            $796,511    $995,289     $908,447
                                            ========    ========     ========

      The accompanying notes are an integral part of these balance sheets.
<PAGE>
 
                            ADVANCE DATA PARTNERSHIP

                            STATEMENTS OF OPERATIONS

                 FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1997

              AND THE SEVEN MONTHS ENDED JULY 31, 1998 (UNAUDITED)

                                             1996       1997         1998
                                         ----------  ----------    --------
                                                                 (Unaudited)

REVENUES                                 $1,038,632  $1,224,020    $892,889
                                         ----------  ----------    -------- 
COSTS AND EXPENSES:                                          
 Cost of services                           305,140     289,376     189,716
 Selling, general, and administrative       499,503     537,948     474,764
 Depreciation and amortization               95,552     126,809      74,577
                                         ----------  ----------    --------
OPERATING INCOME                            138,437     269,887     153,832

OTHER (EXPENSE) INCOME, NET                   1,456     (13,617)     (2,236)
                                         ----------  ----------    --------
INCOME BEFORE PRO FORMA
  INCOME TAX PROVISION                      139,893     256,270     151,596

PRO FORMA INCOME TAX
  PROVISION                                  53,159      97,384      57,606
                                         ----------  ----------    --------
NET INCOME                               $   86,734  $  158,886    $ 93,990
                                         ==========  ==========    ========

        The accompanying notes are an integral part of these statements.
<PAGE>
 
                            ADVANCE DATA PARTNERSHIP

                        STATEMENTS OF PARTNERS' CAPITAL

                 FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1997

                    AND THE SEVEN MONTHS ENDED JULY 31, 1998

BALANCE, DECEMBER 31, 1995                                 $ 381,827

 Net income                                                   86,734
 Pro forma income tax provision                               53,159
                                                           ---------
BALANCE, DECEMBER 31, 1996                                   521,720

 Net income                                                  158,886
 Pro forma income tax provision                               97,384
                                                           ---------
BALANCE, DECEMBER 31, 1997                                   777,990

 Net income (unaudited)                                       93,990
 Pro forma income tax provision (unaudited)                   57,606
 Partnership distribution (unaudited)                       (267,325)
                                                           ---------
BALANCE, July 31, 1998 (unaudited)                         $ 662,261
                                                           =========

        The accompanying notes are an integral part of these statements.
<PAGE>
 
                            ADVANCE DATA PARTNERSHIP

                            STATEMENTS OF CASH FLOWS

                 FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1997

                    AND THE SEVEN MONTHS ENDED JULY 31, 1998
<TABLE> 
<CAPTION> 
                                                           1996       1997        1998
                                                        ---------   --------    ---------
                                                                               (Unaudited)
<S>                                                     <C>         <C>         <C> 
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income                                             $  86,734   $158,886    $  93,990
 Adjustments to reconcile net income to net cash
  provided by operating activities:
    Depreciation and amortization                          95,552    126,809       74,577
    Pro forma income tax provision                         53,159     97,384       57,606
    Changes in current assets and liabilities:
      Accounts receivable                                 (35,555)   (15,483)      (5,347)
      Other current assets                                 (5,734)     1,816      (18,209)
      Accounts payable and accrued liabilities             93,356    (93,002)     239,397
                                                        ---------   --------    ---------
        Net cash provided by operating activities         287,512    276,410      442,014
                                                        ---------   --------    ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchase of property and equipment, net                 (464,084)   (22,828)    (125,296)
                                                        ---------   --------    ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Partnership distributions                                      0          0     (267,325)
 Proceeds from long-term debt                             320,678     70,000            0
 Payments on long-term debt                              (145,678)   (34,490)    (210,510)
                                                        ---------   --------    ---------
        Net cash provided by (used in) financing
          activities                                      175,000     35,510     (477,835)
                                                        ---------   --------    ---------
NET (DECREASE) INCREASE IN CASH                            (1,572)   289,092     (161,117)
CASH, beginning of period                                 118,269    116,697      405,789
                                                        ---------   --------    ---------
CASH, end of period                                     $ 116,697   $405,789    $ 244,672
                                                        =========   ========    =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
  INFORMATION:
   Cash paid for interest                               $   4,226   $ 19,613    $   5,408
                                                        =========   ========    =========
</TABLE>
        The accompanying notes are an integral part of these statements.
<PAGE>
 
                            ADVANCE DATA PARTNERSHIP

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            DECEMBER 31, 1996 AND 1997 AND JULY 31, 1998 (UNAUDITED)

 1. ORGANIZATION AND NATURE OF BUSINESS

    Advance Data Partnership ("Advance Data" or the "Company") (an Arkansas
    general partnership) was established for the purpose of providing core data
    processing, check imaging, and item capture services to financial
    institutions, primarily community banks. Certain assets and liabilities of
    the data processing business are being acquired in a transaction accounted
    for as a purchase by The InterCept Group, Inc. ("InterCept") (Note 11).

    The partnership interests at inception were as follows:

           Mercantile Corporation                         48%
           First Processing Services, Inc.                52%

    The partnership agreement stipulated that all partnership income and losses
    would be allocated directly in proportion to the ownership percentages. On
    December 31, 1997, Mercantile Corporation purchased an additional 4% of the
    partnership from First Processing Services, Inc. for total consideration of
    $31,200.

 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    STATEMENTS OF CASH FLOWS

    For the purposes of the statement of cash flows, short-term investments with
    maturities of three months or less are considered to be cash equivalents.

    USE OF ESTIMATES

    The preparation of financial statements in conformity with generally
    accepted accounting principles requires management to make estimates and
    assumptions that affect the reported amount of assets and liabilities and
    disclosures of contingent assets and liabilities at the date of the
    financial statements and the reported amounts of revenues and expenses
    during the reporting period. Actual results could differ from those
    estimates.

    The interim financial information is unaudited. However, in the opinion of
    management, the interim financial data includes all adjustments, consisting
    only of normal recurring adjustments, necessary for a fair statement of the
    results for the interim periods.

    PROPERTY AND EQUIPMENT

    Property and equipment are recorded at cost at the acquisition date.  The
    Company provides for depreciation using the straight-line method over the
    estimated useful lives of the assets.  Repair and 
<PAGE>
 
    maintenance costs are expensed, and major betterments are capitalized.
    Property, plant, and equipment consisted of the following at December 31,
    1996 and 1997 and July 31, 1998:

<TABLE> 
<CAPTION> 
                                    Useful Life      1996        1997        1998
                                    -----------  ----------  ----------  ----------
                                                                         (Unaudited)
<S>                                 <C>          <C>         <C>         <C> 
    Leasehold improvements          Five years   $   99,154  $   99,154  $   99,154
    Machinery and equipment         Five years      726,375     743,048     864,351
    Furniture and fixtures          Five years       90,869      90,869      94,862
    Software                        Five years      134,021     140,175     140,175
                                                 ----------  ----------  ----------
                                                  1,050,419   1,073,246   1,198,542
    Less accumulated depreciation                  (504,750)   (631,558)   (706,135)
                                                 ----------  ----------  ----------
                                                 $  545,669  $  441,688  $  492,407
                                                 ==========  ==========  ==========
</TABLE> 

    COMPUTER SOFTWARE

    Acquired software and licensing rights are capitalized and amortized using
    the straight-line method over an estimated useful life of five years.

    REVENUE RECOGNITION

    Revenues are derived primarily from service fees and are recognized as
    services are performed.

 4. LONG-TERM DEBT

    Long-term debt consisted of the following at December 31, 1996 and 1997 and
    July 31, 1998:

<TABLE>
<CAPTION>
                                                     1996        1997           1998
                                                  ---------   ---------         -----
                                                                             (Unaudited)
<S>                                               <C>         <C>             <C>
    Revolving note payable to First Bank of
    Arkansas for borrowings of up to $245,000,
    payable on demand, or if no demand is made,
    interest payable at 9% in  monthly principal
    and interest payments of $6,111 through
    April 10, 1999, paid in full subsequent to
    December 31, 1997                             $ 175,000   $ 210,510         $   0

    Less current portion                           (175,000)   (210,510)            0
                                                  ---------   ---------         -----
    Long-term debt, net of current portion        $       0   $       0         $   0
                                                  =========   =========         =====
</TABLE>

 5. INCOME TAXES

    The Company is a partnership for federal and state income tax reporting
    purposes. As such, taxable income and loss of the Company are included in
    the partners' tax returns. The statements of operations reflect pro forma
    income taxes of $53,159, $97,384, and $57,606 for the years ended December
    31, 1996 and 1997 and the seven months ended July 31, 1998, respectively as
    if the Company were subject to income tax. The difference between the pro
    forma income tax

                                      -2-
<PAGE>
 
    provision and the amount computed by applying the statutory federal income
    tax rate to the net income for the period is due to nondeductible expenses
    incurred during each period.
 
    The tax effects of temporary differences between the carrying amounts of
    assets and liabilities in the financial statements and their respective tax
    bases are not material.

 6. EMPLOYEE BENEFITS

    The Company has a defined contribution 401(k) benefit plan which covers
    substantially all employees, subject to certain minimum age and service
    requirements. The plan provides for voluntary contributions by employees and
    matching contributions by the Company at its discretion. For the years ended
    December 31, 1996 and 1997, the Company made no contributions to the plan.

 7. COMMITMENTS

    Advance Data leases certain equipment and facilities under operating leases.
    Future minimum payments on these leases at December 31, 1997 are
    approximately as follows:

                1998                          $ 44,000
                1999                            42,000
                2000                            42,000
                2001                             3,500
                                              --------
                                              $131,500
                                              ========

    Rent expense for all operating leases was approximately $42,000 and $44,000
    for the years ended December 31, 1996 and 1997, respectively.

 8. CUSTOMER CONCENTRATION

    Certain customers made up more than 10% of the Company's sales as of
    December 31, 1996 and 1997, as follows:

                                          1996        1997
                                          ----        ---- 
                Customer A                37.8%       45.5%
                Customer B                12.4        14.7
                Customer C                N/A         11.6

 9. FAIR VALUE OF FINANCIAL INSTRUMENTS

    Advance Data is required to disclose fair value information about financial
    instruments, whether or not they are recognized on the balance sheet, for
    which it is practicable to estimate that value. The assumptions used in the
    estimation of the fair value of the Company's financial instruments are
    detailed below. Where quoted prices are not available, fair values are based
    on estimates using discounted cash flows and other valuation techniques. The
    use of discounted cash flows can be significantly affected by the
    assumptions used, including the discount rate and estimates of future

                                      -3-
<PAGE>
 
    cash flows. The following disclosures should not be considered a surrogate
    of the liquidation value of the Company, but rather a good faith estimate of
    the increase or decrease in value of financial instruments held by the
    Company since purchase, organization, or issuance.

    CASH AND CASH EQUIVALENTS

    For cash, the carrying value amount is a reasonable estimate of fair value.
 
    LONG-TERM DEBT

    The carrying amount of the variable rate long-term debt approximates the
    fair value.

    LIMITATIONS

    Fair value estimates are made at a specific point in time, based on relevant
    market information and information about the financial instrument. These
    estimates do not reflect any premium or discount that could result from
    offering for sale, at one time, the Company's entire holdings of a
    particular financial instrument. Because no market exists for a significant
    portion of the Company's financial instruments, fair value estimates are
    based on many judgments. These estimates are subjective in nature and
    involve uncertainties and matters of significant judgment and therefore
    cannot be determined with precision. Changes in assumptions could
    significantly affect the estimates.

    Fair value estimates are based on existing on- and off-balance sheet
    financial instruments without attempting to estimate the value of
    anticipated future business and the value of assets and liabilities that are
    not considered financial instruments. Significant assets and liabilities
    that are not considered financial instruments include deferred income taxes
    and property and equipment. In addition, the tax ramifications related to
    the realization of the unrealized gains and losses can have a significant
    effect on fair value estimates and have not been considered in the
    estimates.

10. RELATED-PARTY TRANSACTIONS

    Revenues of $392,280, $556,911, and $358,626 for the years ended December
    31, 1996 and 1997 and the seven-month period ended July 31, 1998,
    respectively, were received from First Bank of Arkansas-Jonesboro, an entity
    affiliated with First Processing Services, Inc. through common ownership.

    Accounts receivable as of December 31, 1996 and 1997, and July 31, 1998
    included $43,616, $52,982, and $50,004, respectively, due from First Bank of
    Arkansas-Jonesboro.

    Management and administrative services were performed for the Company by the
    sole shareholder of Mercantile Corporation for a salary of $62,200, $77,692,
    and $58,200 for the years ended December 31, 1996 and 1997 and the seven-
    month period ended July 31, 1998, respectively.

11. SUBSEQUENT EVENT

    On September 30, 1998, InterCept entered into an asset purchase agreement
    with Mercantile Corporation to purchase certain of the assets for a purchase
    price of approximately $1,100,000. In connection with this transaction,
    First Processing Services, Inc. conveyed its remaining 48% interest in the
    Company to Mercantile Corporation as consideration for the cancellation of a
    contract requiring it to use the Company's services. The acquired assets
    consisted primarily of accounts receivable, computer equipment, and various
    other assets.

                                      -4-

<PAGE>
 
 
                                                                    EXHIBIT 99.3

                           The InterCept Group, Inc.
      Unaudited Pro Forma Condensed Consolidated Statement of Operations
                     For the Year Ended December 31, 1997
  
<TABLE>
<CAPTION>
                                                   (a)              (b)
                                               Historical     Advance Data      Pro Forma          Pro Forma
                                              Consolidated     Partnership    Eliminations       Consolidated
                                              ------------    ------------    ------------       ------------
<S>                                           <C>             <C>             <C>                <C>
Revenues                                       $23,260,082      $1,224,020        $      0        $24,484,102

Cost of services                                10,222,651         289,376               0         10,512,027
Selling, general and administrative expense     10,105,317         537,948               0         10,643,265
Depreciation and amortization                    1,323,771         126,809          28,800  (c)     1,479,380
Loss on impairment of intangibles                  727,500               0               0            727,500
Writeoff of purchased research and
  development cost                                       0               0               0                  0
                                               -----------      ----------        --------        -----------
    Total operating expense                     22,379,239         954,133          28,800         23,362,172
                                               -----------      ----------        --------        -----------

Operating Income                                   880,843         269,887         (28,800)         1,121,930
Interest expense                                  (770,175)        (13,617)              0           (783,792)
Interest and other income, net                     121,535               0         (55,000) (d)        66,535
                                               -----------      ----------        --------        -----------

Income before provision for income taxes
 and minority interest                             232,203         256,270         (83,800)           404,673
Provision for income taxes                         666,125          97,384               0            763,509
Minority interest                                   38,564               0               0             38,564
                                               -----------      ----------        --------        -----------

Net loss before preferred dividends               (395,358)        158,886         (83,800)          (320,272)
Preferred dividends                                (32,000)              0               0            (32,000)
                                               -----------      ----------        --------        -----------

Net loss attributable to common shareholders   $  (427,358)     $  158,886        $(83,800)       $  (352,272)
                                               ===========      ==========        ========        ===========

Pro Forma net loss attributable to common
 shareholders                                  $     (0.06)                                      $      (0.05)
                                               ===========                                       ============

Pro forma weighted average common and common
 equivalent shares outstanding                   6,750,114                                          6,750,114
                                               ===========                                       ============
</TABLE>
- --------------
(a) Represents the historical consolidated statement of operations of InterCept
    for the year ended December 31, 1997 contained in the Company's Registration
    Statement on Form S-1 (Registration No. 333-47197) as declared effective by
    the Securities and Exchange Commission on June 9, 1998.
 
(b) Represents the historical statement of operations of Advance Data
    Partnership ("Advance Data") for the year ended December 31, 1997 included
    herein.
  
(c) Reflects the amortization of intangibles related to the acquisition of
    Advance Data as if it had occurred on January 1, 1997.
 
(d) Reflects the reduction in interest income related to the acquisition of
    Advance Data as if it had occurred on January 1, 1997 due to the use of cash
    to fund the acquisition.
<PAGE>

                          The InterCept Group, Inc. 
      Unaudited Pro Forma Condensed Consolidated Statement of Operations
                 For the Nine Months Ended September 30, 1998
<TABLE>
<CAPTION>
 
                                                        (a)              (b)
                                                    Historical      Advance Data       Pro Forma           Pro Forma
                                                   Consolidated      Partnership     Eliminations        Consolidated
                                                   ------------     ------------     ------------        ------------
<S>                                                <C>              <C>              <C>                 <C>
Revenues                                            $20,483,133         $892,889         $      0         $21,376,022
 
Cost of services                                      8,635,678          189,716                0           8,825,394
Selling, general and administrative expense           7,896,546          474,764                0           8,371,310
Depreciation and amortization                           961,551           74,577           16,800   (c)     1,052,928
Loss on impairment of intangibles                             0                0                0                   0
Writeoff of purchased research and
   development costs                                          0                0                0                   0
                                                    -----------         --------         --------         -----------
      Total operating expense                        17,493,775          739,057           16,800          18,249,632
                                                    -----------         --------         --------         -----------
                                                                                                                    0
Operating Income                                      2,989,358          153,832          (16,800)          3,126,390
Interest expense                                       (329,080)          (2,236)               0            (331,316)
Interest and other income, net                          118,844                0          (32,000)  (d)        86,844
                                                    -----------         --------         --------         -----------

Income before provision for income taxes
     and minority interest                            2,779,122          151,596          (48,800)          2,881,918
Provision for income taxes                            1,076,315           57,606                0           1,133,921
Minority interest                                       (79,886)               0                0             (79,886)
                                                    -----------         --------         --------         -----------
 
Net loss before preferred dividends                   1,622,921           93,990          (48,800)          1,668,111
Preferred dividends                                     (16,000)               0                0             (16,000)
                                                    -----------         --------         --------         -----------
 
Net loss attributable to common shareholders        $ 1,606,921         $ 93,990         $(48,800)        $ 1,652,111
                                                    ===========         ========         ========         ===========
 
Pro Forma net loss attributable to common     
 shareholders                                       $      0.20                                           $      0.21
                                                    ===========                                           ===========
 
Pro forma weighted average common and common
 equivalent shares outstanding                        7,866,960                                             7,866,960
                                                    ===========                                           ===========
</TABLE>
- --------------
(a) Represents the historical unaudited consolidated statement of operations of
    InterCept for the nine months ended September 30, 1998 contained in the
    Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
    1998.
 
(b) Represents the historical unaudited statement of operations of Advance Data
    Partnership ("Advance Data") for the seven months ended July 31, 1998
    included herein.
 
(c) Reflects the amortization of intangibles related to the acquisition of
    Advance Data as if it had occurred on January 1, 1998.
 
(d) Reflects the reduction in interest income related to the acquisition of
    Advance Data as if it had occurred on January 1, 1998 due to the use of cash
    to fund the acquisition.


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