<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15 (D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: July 2, 1998
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Aztec Technology Partners, Inc.
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(Exact Name of Registrant as Specified in Its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
3408450
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(Commission File Number) (I.R.S. Employer Identification No.)
52 Roland Street, Boston, Massachusetts 02129
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(Address of Principal Executive Officers) Zip Code
617 623-3100
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, if changed Since Last Report
TABLE OF CONTENTS
FORM 8-K
JULY 2, 1998
ITEM PAGE
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ITEM 5. OTHER EVENTS
ITEM 8. CHANGE IN FISCAL YEAR
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ITEM 5
See press releases dated July 1, 1998 attached as Exhibits 99.1, 99.2 and 99.3
ITEM 8. CHANGE IN FISCAL YEAR
The Board of Directors of Aztec Technology Partners, Inc. (the
"Registrant") voted on June 30, 1998 to change its fiscal year end from the
last Saturday in April, to December 31. The Registrant will file its report
covering the applicable transition period on a Form 10-K.
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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.
AZTEC TECHNOLOGY PARTNERS, INC.
Dated: July 2, 1998 By: /s/ Douglas R. Johnson
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Executive Vice President
and Chief Financial Officer
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EXHIBIT 99.1
FOR IMMEDIATE RELEASE
Contacts: Doug Johnson Christina Pandapas / Mark Nardone
Aztec Technology Partners PAN Communications, Inc.
617/623-3100 978/474-1900
[email protected] [email protected]
AZTEC TECHNOLOGY PARTNERS, INC. ANNOUNCES RESULTS FOR FISCAL YEAR 1998 AND
THE FOURTH QUARTER
Boston MA - July 1, 1998 -
I. FISCAL YEAR 1998 REVENUES UP 52%; PROFORMA OPERATING INCOME UP 29%
II. YEAR TO YEAR QUARTERLY REVENUES UP 88%; PROFORMA OPERATING INCOME UP
55%
III. COMMITMENT LETTER SIGNED FOR $140 MILLION CREDIT AND ACQUISITION FACILITY
WITH BANKBOSTON
IV. LETTER OF INTENT EXECUTED TO ACQUIRE A PROFITABLE, $35 MILLION REVENUE,
ENTERPRISE DESIGN/IMPLEMENTATION COMPANY
Aztec Technology Partners (NASDAQ: AZTC), a leading single-source provider of
information technology business solutions, today announced year-end and
fourth quarter results for the period ending April 25, 1998 For the fourth
quarter ended April 25, 1998, revenues increased 88%, to $65.8 million,
compared to fourth quarter fiscal year 1997 revenues of $35.0 million.
Operating income before one-time charges, goodwill amortization and expenses
relating to the spin-off (from Aztec's former parent USOP) for the same
period was $4.7 million, compared to $3.0 million in 1997, a 55% increase.
The 1998 fourth quarter S,G&A expenses included $1.5 million relating to the
spin-off from U.S. Office Products Company (USOP), consisting of operating
management earnouts at newly acquired companies, bad debt reserves and
duplicated corporate overhead. In addition to these S,G&A charges, the fourth
quarter includes one-time charges of $1 million in strategic restructuring
expenses allocated to the Company by USOP and $750,000 of expenses relating
to the Company's spin-off.
For the fiscal year ended April 25, 1998, revenues increased 52%, to $208.3
million, compared to revenues of $136.3 million for fiscal year 1997.
Proforma revenues for the fiscal year were $256.9 million, based on Aztec
owning all 10 operating companies for the entire year. Operating income, for
the fiscal year, before the one-time charges mentioned above, was $16.3
million, compared to $12.6 million for fiscal year 1997.
In other news, Aztec also announced the signing of a letter of intent for the
acquisition, for $54 million, of a highly profitable, $35 million revenue,
Midwest based
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enterprise design and implementation company with earnings margins before
interest and taxes in the high teens. Aztec also confirmed that it had signed
a commitment letter for a credit and acquisition facility with BankBoston for
$140 million (see releases dated July 1, 1998).
"We witnessed exceptional revenue growth for the year and remain very
enthusiastic about the rapid evolution of the IT services market," said Jim
Claypoole, Chairman and CEO of the Company. "I am particularly enthused by
the successful results of the Aztec cross selling initiative. As we continue
to grow by targeted acquisition and internal development, we are well
positioned to become the single source provider of the seamless design,
delivery and implementation of IT solutions that consistently meet our
clients' strategic business needs."
"The Company completed the spin-off from USOP in a solid financial position,"
said Doug Johnson, Executive Vice President and CFO of the Company. "I am
pleased to get the expenses related to the spin-off from USOP behind us in
the fourth quarter. The cash flow from our existing 10 operating companies,
along with the recently announced $140 million credit facility from
BankBoston, provides us with the necessary capital to execute our growth
strategy."
During all of fiscal year 1998, Aztec operated as the technology solutions
division of U.S. Office Products Company, one of the country's fastest
growing suppliers of office products and furniture. The Company was spun-off
from USOP on June 9, 1998 as part of USOP's strategic restructuring plan,
which included the spin-off of three other USOP divisions.
Aztec Technology Partners is a single-source provider of a broad range of
information technology business solutions. Aztec currently consists of 10
companies that have been in business for an average of more than 15 years and
have a track record of superior client service. These companies offer
complementary IT solutions which allow Aztec to be a 'one-stop' IT solutions
provider with exceptional personalized services. Aztec's primary focus is the
midmarket sector, as well as Fortune 1000 companies, in a wide range of
industries such as: communications, health care, financial services,
government, manufacturing, pharmaceuticals, professional services and
technology. The company has offices in 10 states and employs more than 1100
people. The company is publicly traded on the NASDAQ National Market under
the symbol AZTC.
This press release contains "forward-looking statements," within the meaning
of federal securities laws, that involve risks and uncertainties. All
statements herein, other than those consisting solely of historical facts,
that address activities, events or developments that the Company expects or
anticipates will or may occur in the future, including such things as
business strategy, measures to implement strategy, competitive strengths,
goals, references to future success and other events, may be forward-looking
statements. Statements herein are based on certain assumptions and analyses
by the Company in light of its experience and its perception of historical
trends, current conditions and potential future developments, as well as
other factors it
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believes are appropriate in the circumstances. However, whether actual
results, events and developments will conform with the Company's expectations
is subject to a number of risks and uncertainties and important factors could
cause actual results, events and developments to differ materially from those
referenced in, contemplated by or underlying any forward-looking statements
herein, including, among others, the continued development and viability of
the Company's operations, the Company's ability to manage its growth, the
impact of industry and economic conditions, competition and other factors,
many of which are beyond the control of the Company. Consequently, all
forward-looking statements made herein are qualified by these cautionary
statements and there can be no assurance that the actual results, events or
developments referenced herein will occur or be realized.
The following financial data summarizes Aztec Technology Partners financial
results for the fourth quarter and year ended April 25, 1998.
Aztec Technology Partners, Inc.
Consolidated Statement of Operations
(In thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended Fiscal Year Ended Pro Forma Results
------------------ ----------------- -----------------
Fiscal Year
April 25, April 26, April 25, April 26, Ended
1998 1997 1998 1997 April 25, 1998
----------- ----------- ----------- ------------ -----------------
(Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C> <C>
Revenues $65,829 $34,983 $208,341 $136,278 $256,903
Cost of revenues 50,422 26,080 158,317 102,129 192,053
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Gross profit 15,407 8,903 50,024 34,149 64,850
S, G & A expenses 12,234(1) 5,888 35,185(1) 21,525 43,470(1)
Amortization expense 426 840 1,704
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Opening income before one-time charges 2,747 3,015 13,999 12,624 19,676
One-time charges:
Non-recurring acquisition costs 368 2,274
Strategic restructuring plan 1,750 1,750
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Operating income after one-time charges 997 2,647 12,249 10,350 19,676
Interest expense and other (9) (272) (21) 103 118
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Income before provision for income taxes 1,006 2,919 12,270 10,247 19,558
Provision for income taxes 1,105 1,753 5,797(2) 3,524 8,639
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Net income $ (99) $ 1,166 $ 6,473 $ 6,723 $ 10,919
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---------- --------- ---------- --------- ---------
Operating income before one-time
charges, goodwill and spin-off expenses $ 4,673 $ 3,015 $ 16,339 $ 12,624 $ 22,880
EPS before one-time charges:
Net income before one-time charges $ 1,321 $ 1,534 $ 7,893 $ 8,997 $ 10,919
Basic EPS before one-time charges $ 0.05 $ 0.08 $ 0.33 $ 0.50 $ 0.50
Diluted EPS before one-time charges $ 0.05 $ 0.07 $ 0.32 $ 0.49 $ 0.50
GAAP earnings per share:
Basic $ (0.00) $ 0.06 $ 0.27 $ 0.37 $ 0.50
Diluted $ (0.00) $ 0.06 $ 0.27 $ 0.37 $ 0.50
Weighted average shares outstanding:
Basic EPS data 26,770 20,433 23,911 18,005 21,938
Diluted EPS data 27,211 20,714 24,385 18,352 21,938
</TABLE>
(1) The 1998 fourth quarter S, G & A expenses include $1.5 million relating to
the spin-off of operating management earnouts at acquired companies, bad debt
reserves and duplicated corporate overhead.
(2) The effective tax rate for fiscal year 1998 was 47% compared to 34% in
fiscal year 1997 due to the non-deductibility of goodwill and $1 million of
strategic restructuring expenses.
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EXHIBIT 99.2
FOR IMMEDIATE RELEASE
Contacts: Doug Johnson Christina Pandapas/Mark Nardone
Aztec Technology Partners PAN Communications, Inc.
617/623-3100 978/474-1900
[email protected] [email protected]
AZTEC TECHNOLOGY PARTNERS TO ACQUIRE A HIGHLY PROFITABLE
ENTERPRISE DESIGN/IMPLEMENTATION COMPANY IN $54 MILLION
TRANSACTION
BOSTON, MA - July 1, 1998 - Aztec Technology Partners (NASDAQ:AZTC), a leading
single source provider of information technology (IT) business solutions, today
announced the signing of a letter of intent to acquire a $35 million revenue
Midwest based enterprise design and implementation company with earnings before
interest and taxes (EBIT) margins in the high teens. This acquisition is EPS
accretive and fits within Aztec's acquisition target criteria. This acquisition
also marks Aztec's initial expansion into the Midwest, and is part of an overall
strategy to grow the company via targeted acquisition of IT companies with
complementary products and services. The announced $140 million credit and
acquisition facility with BankBoston will fund the ambitious Aztec acquisition
plans. In other news announced by Aztec today, the Company issued its FY 1998
earnings. (See separate BankBoston credit line, and FY 1998 announcements dated
July 1, 1998.)
This transaction is expected to close later in the month and is subject to
regulatory approval and other customary closing conditions.
As a result of the $54 million transaction, this enterprise design and
implementation company will become a wholly-owned subsidiary of Aztec Technology
Partners. The acquired company's expertise in IT consulting and engineering,
enterprise design and implementation, and IT support and operations outsourcing
will allow Aztec to expand its current IT services business to a wider client
base. This will allow Aztec to gain a stronger foothold as the premier one-stop
IT services provider. The 12-year-old company currently provides IT services to
more than 500 clients in a broad range of industries including: professional
services, banking, financial services, government, healthcare and manufacturing.
It is a strong complement to Aztec's current core competencies in the same
areas.
"This acquisition is a strong complement to our core competencies and is a
significant step to achieving our growth and development objectives by expanding
our IT services offerings to their clients," comments James Claypoole, chairman
and CEO, Aztec Technology Partners. "I am very pleased that the management team
will continue in their current positions of responsibility." Claypoole also
said, "We offer our clients convenient access to leading-edge technology and
consulting providing seamless
<PAGE>
enterprise wide business solutions design and fulfillment of IT services on a
national scale."
About Aztec Technology Partners
Aztec Technology Partners is a single-source provider of a broad range of
information technology business solutions. Aztec currently consists of 10
companies that have been in business for an average of more than 15 years and
have a track record of superior client service. These companies offer
complementary IT solutions which allow Aztec to be a `one-stop' IT solutions
provider with exceptional personalized services Aztec's primary focus is the
mid-market sector, as well as Fortune 1000 companies, in a wide range of
industries such as: communications, health care, financial services, government,
manufacturing, pharmaceuticals, professional services and technology. The
company has offices in 11 states and employs more than 1100 people. The company
is publicly traded on the NASDAQ National Market under the symbol AZTC.
This press release contains "forward-looking statements," within the meaning of
federal securities laws, that involve risks and uncertainties. All statements
herein, other than those consisting solely of historical facts, that address
activities, events or developments that the Company expects or anticipates will
or may occur in the future, including such things as business strategy, measures
to implement strategy, competi tive strengths, goals, references to future
success and other events, may be forwardlooking statements. Statements herein
are based on certain assumptions and analyses by the Company in light of its
experience and its perception of historical trends, current conditions and
potential future developments, as well as other factors it believes are
appropriate In the circumstances. However, whether actual results, events and
developments will conform with the Company's expectations is subject to a number
of risks and uncertainties and important factors could cause actual results,
events and developments to differ materially from those referenced in,
contemplated by or underlying any forward-looking statements herein, including,
among others, the continued development and viability of the Company's
operations, the Company's ability to manage its growth, the impact of industry
and economic conditions, competi tion and other factors, many of which are
beyond the control of the Company. Consequently, all forward-looking statements
made herein are qualified by these cautionary statements and there can be no
assurance that the actual results, events or developments referenced herein will
occur or be realized.
###
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EXHIBIT 99.3
FOR IMMEDIATE RELEASE
Contacts: Doug Johnson Christina Pandapas / Mark Nardone
Aztec Technology Partners PAN Communications, Inc.
(617) 623-3100 (978) 474-1900
[email protected] [email protected]
AZTEC TECHNOLOGY PARTNERS SIGNS COMMITMENT LETTER FOR $140
MILLION CREDIT AND ACQUISITION FACILITY FROM BANKBOSTON
I. New Credit Line to Support Aztec's Strategic Acquisition Plans
BOSTON, MA - July 1, 1998 - Aztec Technology Partners (Nasdaq: AZTC), a leading
single-source provider of information technology (IT) business solutions,
announced today that the company received a commitment letter for a $140 million
line of credit from BankBoston Corp. (NYSE:BKB) which will be utilized to
support the company's aggressive growth strategy. The line of credit replaces
the $15 million BankBoston credit line received earlier in the year. In two
separate releases today, Aztec also announced a letter of intent to acquire a
highly profitable, $35 million revenue, Midwest based enterprise design and
implementation company with earnings margins before interest and taxes in the
high teens; and issued Aztec's FY 1998 earnings.
"The BankBoston credit line demonstrates BankBoston's confidence in the company
and its business strategy and provides the company with the financial resources
necessary to support Aztec's ambitious strategic and geographic growth plans
throughout the U.S." said Jim Claypoole, Chairman and CEO of Aztec. "The
products and services provided by Aztec and its 10 operating companies are
central to the solidification of the Aztec goal of being the premier one-stop
national IT service provider. As we look to further strengthen our position in
the growing IT marketplace, BankBoston will be a valuable partner for our
company and its future growth strategy," says Claypoole.
Aztec Technology Partners launched as a spin off of U.S. Office Products
(Nasdaq: OFISD) on June 9 with a distribution of approximately 21.9M common
shares trading on the Nasdaq National Market. The company was initially formed
in October 1996 with U.S. Office Products' acquisition of Bay State Computer
Group, and since that time has acquired nine other complementary IT solutions
companies to form Aztec Technology Partners. With the new $140M BankBoston
credit line, the company is now well positioned to continue its expansion into
other regions throughout the U.S
"Aztec is in a very attractive marketplace and has clearly demonstrated that
<PAGE>
its acquisition strategy is building a powerful group of IT service providers
which are both geographically and strategically complementary to Aztec's goal of
being the premier one-stop national service provider," says Tena Lindenauer,
Managing Director, BankBoston. "Aztec is on a solid path based on the vision of
its leadership and its successful track record to date."
BankBoston's commitment is subject to the preparation of mutually acceptable
loan documentation and the satisfaction of the conditions in that documentation.
About Aztec Technology Partners
Aztec Technology Partners is a single-source provider of a broad range of
information technology business solutions. Aztec currently consists of 10
companies that have been in business for an average of more than 15 years and
have a track record of superior client service. These companies offer
complementary IT solutions which allow Aztec to be a `one-stop' IT solutions
provider with exceptional personalized services. Aztec's primary focus is the
mid-market sector, as well as Fortune 1000 companies, in a wide range of
industries such as: communications, health care, financial services, government,
manufacturing, pharmaceuticals, professional services and technology. The
company has offices in 11 states and employs more than 1100 people. The company
is publicly traded on the NASDAQ National Market under the symbol AZTC.
About BankBoston
BankBoston (NYSE:BKB), with assets of $71.4 billion as of March 31, 1998, was
founded in 1784 and is the 16th-largest bank holding company in the United
States. BankBoston offers a full range of banking services to consumers, small
businesses and corporate customers in southern New England; delivers
sophisticated financial solutions to mid-size and large corporations nationally
as well as corporations and governments internationally; and provides
full-service banking in leading Latin Ameri can markets. BankBoston's technology
practice is one of the largest and most experienced in the country. The
Corporation's common and preferred stocks are listed on the New York and Boston
stock exchanges.
This press release contains "forward-looking statements," within the meaning of
federal securities laws, that involve risks and uncertainties. All statements
herein, other than those consisting solely of historical facts, that address
activities, events or developments that the Company expects or anticipates will
or may occur in the future, including such things as business strategy, measures
to implement strategy, competi tive strengths, goals, references to future
success and other events, may be forwardlooking statements. Statements herein
are based on certain assumptions and analyses by the Company in light of its
experience and its perception of historical trends, current conditions and
potential future developments, as well as other factors it believes are
appropriate In the circumstances. However, whether actual results, events and
developments will conform with the Company's expectations is subject to a number
of risks and uncertainties and important factors could cause actual results,
events and developments to differ materially from those referenced in,
contemplated
<PAGE>
by or underlying any forward-looking statements herein, including, among others,
the continued development and viability of the Company's operations, the
Company's ability to manage its growth, the impact of industry and economic
conditions, competi tion and other factors, many of which are beyond the control
of the Company. Consequently, all forward-looking statements made herein are
qualified by these cautionary statements and there can be no assurance that the
actual results, events or developments referenced herein will occur or be
realized.
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