<PAGE> 1
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): January 3, 2000
HeadHunter.NET, Inc.
--------------------
(Exact name of registrant as specified in its charter)
Georgia 0-27003 58-2403177
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
6410 Atlantic Blvd. Suite 160, Norcross, GA 30071
(Address of principal executive offices)
Registrant's telephone number, including area code: (770) 349-2400
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
This current report on Form 8-K/A is filed to amend the Registrants current
report on Form 8-K dated January 3, 2000 pursuant to Item 7 of Form 8-K.
(a) Financial Statements of Business Required
The following Financial Statements of Chicago Computer Guide--ALL IN ONE SUBMIT
are filed herein to amend the current report on Form 8-K dated January 3, 2000.
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To Chicago Computer Guide, Inc.:
We have audited the accompanying balance sheet of CHICAGO COMPUTER GUIDE,
INC.--ALL IN ONE SUBMIT (an unincorporated division of Chicago Computer Guide,
Inc.) as of October 31, 1999 and the related statements of income and changes
in retained earnings and cash flows for the period from inception (November 1,
1998) to October 31, 1999. These financial statements are the responsibility of
All In One's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit 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 audit provides 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 Chicago Computer Guide,
Inc.--All In One Submit as of October 31, 1999 and the results of its
operations and its cash flows for the period from inception (November 1, 1998)
to October 31, 1999 in conformity with generally accepted accounting
principles.
/s/ Arthur Andersen LLP
Atlanta, Georgia
February 22, 2000
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CHICAGO COMPUTER GUIDE, INC.--
ALL IN ONE SUBMIT
BALANCE SHEET
OCTOBER 31, 1999
<TABLE>
<CAPTION>
ASSETS
<S> <C>
CURRENT ASSETS:
Cash $ 70,231
Accounts receivable 27,675
Due from parent 4,517
---------
Total current assets 102,423
---------
PROPERTY AND EQUIPMENT:
Computer equipment 3,114
Less accumulated depreciation (87)
---------
Total computer equipment, net 3,027
---------
Total assets $ 105,450
=========
LIABILITIES AND RETAINED EARNINGS
CURRENT LIABILITIES:
Accrued payroll liabilities $ 2,389
Deferred revenue 37,640
---------
Total current liabilities 40,029
---------
COMMITMENTS AND CONTINGENCIES
RETAINED EARNINGS 65,511
---------
Total liabilities and retained earnings $ 105,540
=========
</TABLE>
The accompanying notes are an integral part of this balance sheet.
<PAGE> 4
CHICAGO COMPUTER GUIDE, INC.--
ALL IN ONE SUBMIT
STATEMENT OF INCOME
AND CHANGES IN RETAINED EARNINGS
FOR THE PERIOD FROM INCEPTION (NOVEMBER 1, 1998)
TO OCTOBER 31, 1999
<TABLE>
<S> <C>
REVENUES $ 144,728
---------
COSTS AND EXPENSES:
Costs of revenues 39,217
Marketing and selling 3,670
General and administrative 36,243
Depreciation 87
---------
Total costs and expenses 79,217
---------
NET INCOME 65,511
RETAINED EARNINGS, BEGINNING OF PERIOD 0
---------
RETAINED EARNINGS, END OF PERIOD $ 65,511
=========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 5
CHICAGO COMPUTER GUIDE, INC.--
ALL IN ONE SUBMIT
STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM INCEPTION (NOVEMBER 1, 1998)
TO OCTOBER 31, 1999
<TABLE>
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 65,511
---------
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 87
Changes in operating assets and liabilities:
Accounts receivable (27,675)
Due from parent (4,517)
Accrued payroll liabilities 2,389
Deferred revenue 37,640
---------
Total adjustments 7,924
---------
Net cash provided by operating activities 73,435
---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of computer equipment (3,114)
---------
NET INCREASE IN CASH 70,321
CASH, BEGINNING OF PERIOD 0
---------
CASH, END OF PERIOD $ 70,321
=========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 6
CHICAGO COMPUTER GUIDE, INC.--
ALL IN ONE SUBMIT
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 1999
1. ORGANIZATION AND NATURE OF BUSINESS
Chicago Computer Guide, Inc. ("CCG") was incorporated in the state of
Illinois in December 1994. CCG provides technical literature to
subscribers throughout the United States.
All In One Submit (an unincorporated division of CCG) ("All In One")
is an on-line job-posting company based in Chicago, Illinois.
Utilizing sophisticated job-posting technology, All In One offers its
customers the ability to post jobs on multiple free job sites and news
groups across the Internet.
The financial statements and related footnotes contained herein
reflect the operations of CCG's All In One's base of customers in the
United States. A portion of All In One's assets, including equipment,
intellectual property, and the existing customer base, is being
acquired in a transaction accounted for as a purchase by
Headhunter.NET, Inc. ("HeadHunter"). All In One's financial statements
have been derived from the historical books and records of CCG.
Therefore, certain financial amounts have been allocated by CCG in
order to present the financial results of All In One on a stand-alone
basis. Management believes such allocations are reasonable, however,
the costs allocated to All In One may not necessarily be indicative of
the costs that would have been incurred if All In One had operated on
a stand-alone basis. All In One is an on-line job-posting company in
the Chicago area that was organized by CCG on November 1, 1999.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ACCOUNTING 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 disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the period. Actual results could differ from those
estimates.
REVENUE RECOGNITION
Revenues consist of job-posting revenues and are recognized over the
period in which services are provided.
<PAGE> 7
DEFERRED REVENUE
Deferred revenue represents the liability for advance billings to
customers. Such amounts are recognized as revenues when the related
services are provided.
COMPUTER EQUIPMENT
Computer equipment is stated at cost and is depreciated using the
straight-line method over its estimated useful life of three years.
Additions and improvements are charged to the fixed asset account
while maintenance and repairs which do not improve or extend the lives
of the fixed assets are expensed in the current period.
SEGMENTAL DISCLOSURES
All In One adopted Statement of Financial Accounting Standards No.
131, "Segmental Disclosures," effective November 1, 1998. The standard
had no effect, because All In One operates in one segment.
INCOME TAXES
All In One, with the consent of its shareholder, has elected under the
Internal Revenue Code to be an S corporation and is therefore not
liable for federal and state income taxes. All In One's net income or
loss is allocated to the shareholder in accordance with the corporate
charter and the shareholder is taxed individually on his share of All
In One's earnings.
CONCENTRATION OF CREDIT RISK
Financial instruments that potentially subject All In One to
concentrations of credit risk consist principally of trade
receivables. All In One's cash investment policies limit investments
to short-term, low-risk instruments. Concentrations of credit risk
with respect to trade receivables are limited due to advance billings
to customers for services and the ability to terminate service on
delinquent accounts. In addition, the number of customers comprising
the customer base mitigates the concentration of credit risk. The
carrying amount of All In One's receivables approximates their fair
value.
3. RELATED-PARTY TRANSACTIONS
CCG either advances funds to or borrows funds from All In One. The
advances and borrowings are netted and are reflected in the "due from
parent" line item included in the accompanying balance sheet. At
October 31, 1999, All In One has a due from CCG of $4,517.
4. COMMITMENTS AND CONTINGENCIES
OPERATING LEASES
All In One occupies office space that is leased by CCG under a
noncancelable operating lease agreement. Under the terms of the
operating lease agreement, all future lease commitments are the
obligation of CCG. All In One has no future rental obligations to CCG
or the lessor.
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Based upon the portion of office space occupied by All In One, CCG has
allocated a share of its rent expense to All In One. All In One's
share of rent expense in the amount of $5,130 is included in the
accompanying statement of income and changes in retained earnings.
LEGAL PROCEEDINGS
All In One is not currently party to any legal proceedings. All In
One, from time to time, may be subject to legal proceedings and claims
in the ordinary course of business, including claims of alleged
infringement of trademarks and other intellectual property of third
parties by All In One. Such claims, even if not meritorious, could
result in the expenditure of significant financial and managerial
resources.
5. RETIREMENT PLAN
All In One participates in a simplified employee pension ("SEP") plan
sponsored by CCG. The SEP plan is a defined contribution plan which
covers all employees meeting age and years of service requirements
provided in the plan. CCG makes contributions to the plan equal to 15%
of each participant's annual salary. As of the end of the year, an
annual contribution had not yet been made to the plan. An accrual in
the amount of $1,703 for the portion of benefit plan contributions
related to All In One is included in the accompanying balance sheet.
6. SUBSEQUENT EVENT
On December 17, 1999, CCG executed an asset purchase agreement to
divest All In One to a third party, HeadHunter. In consideration for
the deal, the sole shareholder of CCG has received 25,000 shares of
HeadHunter common stock and $250,000 and will receive an additional
75,000 shares of HeadHunter common stock and cash consideration of
$50,000 based on an earn-out provision.
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(b) Pro Forma Financial Information.
UNAUDITED PRO FORMA FINANCIAL DATA
The following pro forma balance sheet reflects the acquisition by
HeadHunter.NET of certain assets of All in One Submit (an unincorporated
division of Chicago Computer Guide, Inc.) ("AIOS") as if it had occurred on
September 30, 1999. The pro forma balance sheet has been prepared combining
AIOS's 7/31/99 unaudited balance sheet with HeadHunter.NET's 9/30/99 unaudited
balance sheet. The following pro forma statement of operations for the nine
months ended September 30, 1999 has been prepared by combining HeadHunter.NET's
unaudited historical results of operations for the nine months ended September
30, 1999 with AIOS's unaudited historical income statement for the nine months
ended July 31, 1999 and reflects the acquisition by HeadHunter.NET of AIOS as
if it had occurred on November 1, 1998. The pro forma financial information
does not purport to represent what HeadHunter.NET's consolidated results of
operations would have been if the acquisition had in fact occurred on these
dates, nor does it purport to indicate HeadHunter.NET's future consolidated
financial position or future consolidated results of operations. The pro forma
adjustments are based on currently available information and certain
assumptions that HeadHunter.NET's management believes are reasonable.
UNAUDITED PRO FORMA
BALANCE SHEET
AS OF SEPTEMBER 30, 1999
(In Thousands)
<TABLE>
<CAPTION>
HISTORICAL
HEADHUNTER.NET AIOS ADJUSTMENTS TOTAL
Total Assets: -------------- ------ ----------- -------
<S> <C> <C> <C> <C>
Cash and cash equivalents 24,631 51 (250)(a) 24,381
(51)(a)
Short term investments -- -- -- --
Accounts receivable, net 1,486 25 (25)(a) 1,486
Prepaid expenses and other 170 3 (3)(a) 170
------- --- ---- -------
Total current assets 26,287 79 (329) 26,037
------- --- ---- -------
Property and equipment, net 1,306 -- 6 (a) 1,312
Intangible assets, net 604 -- 600 (a) 1,204
Other noncurrent assets 84 -- -- 84
------- --- ---- -------
Total assets 28,281 79 277 28,637
======= === ==== =======
Liabilities and shareholders' equity:
Accounts payable 1,193 -- -- 1,193
Other accrued expenses 1,166 -- -- 1,166
Customer deposits 22 -- -- 22
Deferred revenue 84 30 (30)(a) 84
------- --- ---- -------
Total current liabilities 2,465 30 (30) 2,465
------- --- ---- -------
Shareholders' equity:
Common stock 108 -- -- 108
Additional paid-in capital 64,424 -- 356 (a) 64,780
Stock warrants 342 -- -- 342
Accumulated deficit (34,498) 49 (49)(a) (34,498)
Deferred Compensation (4,560) -- -- (4,560)
------- --- ---- -------
Total shareholders' equity 25,816 49 307 26,172
------- --- ---- -------
Total liabilities and shareholders' equity 28,281 79 277 28,637
======= === ==== =======
</TABLE>
(a) Reflects the preliminary purchase price allocation based on $606,000,
with payment comprised of $250,000 in cash and 25,000 shares of
HeadHunter common stock valued at approximately $356,000. The estimated
remaining purchase price of approximately $1.1 million is based on a
earn out provision in the original purchase documents. In addition to
the acquired customer base, HeadHunter acquired property and equipment
with an estimated fair value of $6,000. All other assets and
liabilities of AIOS are not being acquired and , accordingly, they have
been eliminated in the accompanying pro forma balance sheet.
<PAGE> 10
UNAUDITED PRO FORMA
STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999
(In Thousands, except per share data)
<TABLE>
<CAPTION>
HISTORICAL
HEADHUNTER.NET AIOS ADJUSTMENTS TOTAL
-------------- ------- ----------- ---------
<S> <C> <C> <C> <C>
REVENUES $ 5,306 $ 109 $ 5,415
COSTS AND EXPENSES:
Costs of revenues 94 29 123
Marketing and selling 5,819 3 5,822
General and administrative 2,363 27 2,390
Stock compensation expense 5,039 0 5,039
Depreciation and amortization 333 0 91 (a) 424
---------- ------- ---------- ----------
Total costs and expenses 13,648 59 91 13,798
---------- ------- ---------- ----------
OPERATING INCOME (LOSS) $ (8,342) $ 50 $ (91) $ (8,383)
---------- ------- ---------- ----------
OTHER INCOME (EXPENSE) 66 0 0 66
---------- ------- ---------- ----------
NET INCOME (LOSS) $ (8,276) $ 50 $ (91) $ (8,317)
========== ======= ========== ==========
LOSS PER SHARE:
Basic and diluted $ (2.23) $ (2.24)
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic and diluted 3,719 3,719
</TABLE>
(a) Represents additional amortization based on the preliminary purchase
price allocation (as noted in footnote (a) to the pro forma balance
sheet) for All in One Submit acquisition over five years
<PAGE> 11
(C) EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
-------- -----------
<S> <C>
2.1 Purchase Agreement dated December 17, 1999 between
HeadHunter.NET, Inc., Chicago Computer Guide, Inc.
and George Scholomite.*
99.1 Press Release dated December 20, 1999*
</TABLE>
- -------------------
* Previously Filed
<PAGE> 12
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.
HeadHunter.NET, Inc.
/s/ Mark W. Partin
------------------------------------------------
Mark W. Partin
Chief Financial Officer and Assistant Secretary
Date: March 2, 2000
