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UNITED STATES
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 (Date of earliest event reported): August 30, 2000
Commission File Number:
THE MANAGEMENT NETWORK GROUP, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 48-1129619
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State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7300 COLLEGE BLVD., SUITE 302, OVERLAND PARK, KS 66210
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(Address of principal executive offices) (Zip Code)
913-345-9315
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Registrant's telephone number, including area code
NOT APPLICABLE
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(Former name, former address and former fiscal year, if changed
since last report.)
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Item 2. ACQUISITION OR DISPOSITION OF ASSETS
(a) PURCHASE PRICE AND CONSIDERATION
On August 30, 2000, The Management Network Group, Inc. (the "Registrant"
or "TMNG") announced the acquisition of The Weathersby Group, Inc. ("TWG") of
Bethesda, Maryland. In a stock purchase agreement between TMNG and the
shareholder of TWG (the "Seller"), TMNG agreed to pay, in exchange for all of
the outstanding shares of TWG, an amount equal to $19.2 million, as the initial
purchase price, payable in 348,157 newly-issued and unregistered shares of
common stock, representing $8.0 million calculated at a fixed price of $22.98
per share, and $11.2 million in cash, with $3.5 million of the cash to be placed
in escrow and paid out upon full satisfaction (or provision for resolution
thereof) of any claims or disputed claims, if any, received by the escrow agent
prior to the date which is one year following the commencement of the escrow
account.
On the date of announcement of the acquisition, the closing price of
TMNG's common stock was $22.81 per share.
TMNG further agreed to pay an amount up to $9.0 million of additional
consideration, consisting of $2.5 million cash consideration and $6.5 million
stock consideration, contingent on TWG achieving certain performance targets in
2001. Consideration will be paid-out if the performance targets are met on March
31, 2002.
The acquisition was completed on September 5, 2000.
(b) ASSETS OF THE BUSINESS PURCHASED AND INTENDED USE OF THE ASSETS
Through the merger, TMNG will fold its Marketing and Customer
Relationship Management (CRM) practice, launched earlier this year, into TWG to
create a new wholly owned TMNG subsidiary, TWG Marketing. TWG Marketing will
operate as a full service marketing telecommunications consulting practice to
the encompassing product development and positioning, strategy, CRM and loyalty
programs, communications, and channel management, among other services. TWG
Marketing will be led by Amanda Weathersby, the founder and CEO of TWG.
(c) SOURCE OF THE FUNDS USED IN THE ACQUISITION
In addition to TMNG common stock, the funding for the acquisition was
provided from available cash resources.
(d) ACCOUNTING
The transaction will be accounted for using purchase accounting.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) FINANCIAL STATEMENTS
Registrant expects to file the financial information required by this
item by amendment within 60 days of September 14, 2000.
(b) PRO FORMA FINANCIAL INFORMATION
Registrant expects to file the financial information required by this
item by amendment within 60 days of September 14, 2000.
(c) EXHIBITS
A copy of the Stock Purchase Agreement dated August 30, 2000 between The
Management Network Group, Inc. and the shareholder of The Weathersby Group, Inc.
is filed herewith as Exhibit 2.1 and is incorporated herein by reference.
A copy of the press release issued by the Registrant on August 30, 2000
concerning the completion of the foregoing transaction is filed herewith as
Exhibit 99.1 and is incorporated herein by reference.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Dated: September 14, 2000 The Management Network Group, Inc.
By: /s/ Donald E. Klumb
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Donald E. Klumb
Executive Vice President and
Chief Financial Officer
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EXHIBIT INDEX
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Exhibit
Number Description of Document
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2.1 Stock Purchase Agreement, dated August 30, 2000
between Registrant and the shareholder of
The Weathersby Group, Inc.
99.1 Press Release of Registrant, dated August 30, 2000,
announcing the completion of the acquisition of The
Weathersby Group, Inc., a Maryland corporation.
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