<PAGE>
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 March 31, 1994
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 0-10625
THE ASK GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 94-2250034
(State or other jurisdiction of (I.R.S.
Employer
incorporation or organization)
identification no.)
2880 Scott Boulevard, Santa Clara , CA
95052-8013
(Address of principal executive offices)
(Zip code)
Registrant's telephone number, including area code:
(408) 562-8800
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 outstanding of the issuer's common
stock as of April 30, 1994 was 23,534,707.
<PAGE>
THE ASK GROUP, INC.
INDEX
Page No.
PART I. FINANCIAL INFORMATION
Item 1.Financial Statements
Condensed Consolidated Balance Sheets 3
Condensed Consolidated Statements of Operations 4
Condensed Consolidated Statements of Cash Flows 5
Notes to Condensed Consolidated Financial Statements6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II. OTHER INFORMATION 13
<PAGE>
PART I.FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
THE ASK GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands - except shares)
<CAPTION>
March 31, June 30,
1994 1993
(unaudited)
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 30,804 $ 18,271
Accounts receivable, less allowances for
accounts of $2,936 ($7,583 at June 30, 1993) 123,725 146,097
Inventory 744 1,184
Prepaid income taxes - 2,067
Other current assets 14,354 15,966
Total current assets 169,627 183,585
Capitalized software development costs, net 12,394 11,950
Property, plant and equipment, at cost 98,396 92,895
Less: accumulated depreciation and amortization 53,927 46,906
Net property, plant and equipment 44,469 45,989
Goodwill, net 42,283 45,025
Purchased intangibles, net 15,091 25,022
Other long-term assets 2,807 4,200
$ 286,671 $ 315,771
</TABLE>
<PAGE>
[CAPTION]
[S] [C] [C]
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt $ 43,100 $ 3,121
Accounts payable 28,402 26,786
Accrued payroll and related items 22,503 25,637
Sales and value added taxes payable 6,305 6,670
Other accrued liabilities 16,973 17,218
Accrued restructuring costs 32,104 -
Current portion of other liabilities 2,291 3,318
Income taxes payable 3,374 -
Customer deposits 546 849
Deferred income taxes 30 -
Deferred revenue 62,721 66,160
Total current liabilities 218,349 149,759
Long-term debt, net of current portion - 9,697
Other liabilities, net of current portion 5,000 4,528
Deferred income tax 525 3,252
Stockholders' equity:
Common stock, $0.01 par value, 40,000,000 shares au
23,465,296 outstanding (22,917,022 at June 30,
1993) 235 229
Additional paid-in-capital 144,526 140,949
Retained earnings (accumulated deficit) (78,768) 10,541
Cumulative translation adjustment (3,196) (3,184)
Total stockholders' equity 62,797 148,535
$ 286,671 $ 315,771
[/TABLE]
[FN]
See accompanying notes.
<PAGE>
<TABLE>
THE ASK GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts - unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Net revenue:
Systems $ 43,407 $ 59,904 $ 143,270 $ 176,089
Service 43,353 40,575 127,948 121,670
86,760 100,479 271,218 297,759
Costs and expenses:
Cost of systems 8,486 21,590 32,031 61,452
Cost of service 21,891 19,575 60,321 58,281
Product development 12,749 11,941 35,265 34,125
Selling, general and administra 60,928 47,103 173,135 145,454
Restructuring charge 45,000 - 49,000 -
Amortization of goodwill and
other purchased intangibles 2,008 1,989 6,045 6,155
Total costs and expenses 151,062 102,198 355,797 305,467
Loss from operations (64,302) (1,719) (84,579) (7,708)
Interest and other income, net (181) (277) (40) 517
Interest expense (979) (490) (2,394) (1,880)
Loss before income taxes (65,462) (2,486) (87,013) (9,071)
Provision for (benefit from) income
taxes 3,394 (1,812) 2,296 (4,446)
Net loss $ (68,856)$ (674)$ (89,309)$ (4,625)
Loss per share $ (2.95) $ (0.03) $ (3.87) $ (0.21)
Shares used in per share
calculation 23,304 22,571 23,104 21,839
<FN>
See accompanying notes.
</TABLE>
<PAGE>
<TABLE>
THE ASK GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
( In thousands - unaudited )
<CAPTION>
Nine Months Ended
March 31,
1994 1993
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (89,309) $ (4,625)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization 25,456 23,129
Restructuring charge 43,308 -
Changes in assets and liabilities:
Accounts receivable 23,041 16,787
Inventory 184 774
Prepaid income tax 2,065 -
Accounts payable 1,557 (9,480)
Accrued payroll and related items (3,230) (764)
Income taxes payable 3,303 (430)
Sales and valued added taxes payable (287) (4,899)
Other accrued liabilities (455) (6,277)
Customer deposits (303) (186)
Deferred income taxes (2,687) (7,921)
Deferred revenue (3,233) (674)
Other, net 1,811 (4,075)
Net cash provided by operating activities 1,221 1,359
Cash flows from investing activities:
Capitalized software development costs (9,449) (5,933)
Purchase of intangible assets (1,243) -
Capital expenditures, net of retirements (9,029) (12,816)
Net cash used for investing activities (19,721) (18,749)
Cash flows from financing activities:
Principal payments on bank borrowings and capital lease (9,236) (4,990)
Bank borrowings 36,600 -
Issuance of stock, net 3,582 8,968
Net cash provided by financing activities 30,946 3,978
Effect of exchange rates on cash 87 (1,509)
Net (increase) decrease in cash and cash equivalents 12,533 (14,921)
Cash and cash equivalents at beginning of period 18,271 27,743
Cash and cash equivalents at end of period $ 30,804 $ 12,822
<FN>
See accompanying notes.
</TABLE>
<PAGE>
NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
(Unaudited)
March 31, 1994
1. The condensed consolidated financial statements
for the three- and nine-months ended March 31,
1994 and 1993 are unaudited, but include all
adjustments, which, in the opinion of management,
are necessary for a fair statement of the results
of operations for the interim periods presented.
The interim results are not necessarily indicative
of the results for the full year. Certain prior
period amounts have been reclassified to conform
with the current period's presentation.
2. A summary of the significant accounting policies
of the Company is included in the consolidated
financial statements listed in Item 8 of the
Company's Form 10-K for the fiscal year ended June
30, 1993.
3. The condensed consolidated financial statements include the
accounts of The ASK Group, Inc. and all of its
wholly-owned subsidiaries, after the elimination
of intercompany accounts and transactions.
4. The Company capitalizes software development costs in
accordance with Statement of Financial Accounting
Standards No. 86. Such costs are amortized on a
straight-line basis over the estimated useful life
which ranges from one to three years or the ratio
of current revenue to the total current and
anticipated future revenue, whichever is greater.
The capitalization and amortization of software development costs for
the three- and nine-months ended March 31, 1994
and 1993 follow (in thousands):
<TABLE>
<CAPTION>
Three Months Nine Months
Ended March 31, Ended March 31,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Balance, beginning of $14,497 $9,416 $11,950 $9,383
period
Software development 2,303 2,028 9,449 5,933
costs capitalized
Write-off of capitalized 2,131 - 2,131 -
costs
Amortization of 2,275 1,441 6,874 5,313
capitalized costs
Balance, end of period $12,394 $10,003 $12,394 $10,003
</TABLE>
<PAGE>
5. In the three-months ended March 31, 1994, the Company recorded a
restructuring charge of $45,000,000. The Company
restructured its organization to strengthen its
ongoing cash, expense control and financial
position. The restructuring charge is principally
related to a reduction in the workforce worldwide,
the closure and consolidation of certain
facilities, and write-offs of non-productive
assets. The Company also posted a restructuring
charge of $4,000,000 during the three-month period
ended December 31, 1993. (Also see Management's
Discussion and Analysis.)
6. On May 9, 1994 the Company announced that
its Board of Directors and lending
banks had formally approved the terms of a new,
secured line of credit, replacing an existing $50
million credit facility under which the Company
was in default. The restructured agreement, which
the Company expects to execute in May 1994,
provides for a $30,000,000 term loan and a
$10,000,000 revolving credit and standby letter of
credit facility. The term loan will require
repayments of $3,500,000 each quarter through the
June 30, 1996 maturity date. Amounts outstanding
under the Agreement bear interest at the prime
rate (6.75% at May 9, 1994) plus a variable
interest rate, between 1% and 3%, based on the
principal balance of the term loan. The Agreement
is secured by assets the ASK Group holds in the
United States.
In addition to interest, the Company must pay a
quarterly commitment fee equal to .5% per annum on
the unused amount of the revolving credit
facility.
The Agreement contains affirmative and negative
covenants and will, among other things, require
the maintenance of certain financial ratios; limit
net losses in specified periods; limit the
Company's ability to incur additional debt, pay
cash dividends, or to purchase or sell certain
assets; and restrict certain acquisitions,
mergers, consolidations, or similar transactions.
<PAGE>
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The ASK Group, Inc. (the Company) develops, markets and
sells computer-based relational database management systems
(RDBMS), data access and connectivity products,
manufacturing and financial applications software and
application development tools and provides related
consulting and support services. The Company has two
independent business units: Ingres for the database and
tools products and ASK Manufacturing Systems for
manufacturing application software. The Ingres business
unit was formerly divided into two separate units. They
share a common administrative infrastructure. The Company's
products are sold and supported through a network of Company-
owned and independent distribution operations located
worldwide. The business units are responsible for designing
and developing products as well as designing programs to
position products and creating marketing programs.
RESULTS OF OPERATIONS
The Company's revenue is derived from computer systems sales
and a full range of services. Computer systems sales
include licensing proprietary software and
reselling/licensing of third party computer hardware and
software products on a turnkey basis. Service revenue
includes maintenance contracts (including updates to
software products), education, technical support and
application integration and implementation consulting.
The Company's reported loss of $68,856,000 or $2.95 per
share, for the quarter ended March 31, 1994 reflects
primarily a restructuring charge of $45,000,000 for
consolidation of facilities, worldwide headcount reductions
and write-offs of non-productive assets; and $4,500,000 of
additional bad debt expense. Before restructuring and bad
debt charges, the Company had a loss from operations of
$14,802,000 as compared to $1,719,000 for the year-ago
quarter.
Total revenue for the three- and nine-months ended March 31,
1994 decreased $13,719,000 (14%) and $26,541,000 (9%),
respectively, from that of the same prior year periods.
Software revenue declined $7,165,000 (15%) and $11,279,000
(8%), respectively for the three- and nine-month periods
ended March 31, 1994 when compared to the year earlier
periods. Management believes that a portion of the revenue
shortfall resulted from purchasing delays by customers
because of uncertainty about the Company's financial
condition. Additionally a stronger U.S. dollar in the nine-
month fiscal 1994 period compared to the fiscal 1993 period
had a negative impact on revenue growth rates in Europe when
revenue denominated in European currencies was translated to
equivalent amounts in U.S. dollars. Hardware revenue
decreased $9,332,000 (71%) and $21,540,000 (57%) in the
three- and nine-month periods, respectively, as the Company
continued to de-emphasize third party hardware resold with
applications software due to the trend toward open UNIX-
based software applications.
Software revenue trends were negatively impacted by a
reclassification during fiscal 1994 of revenue and its
related costs attributable from third party software
distributors. In fiscal 1993, the Company included the full
amount of revenue generated by its distributors in systems
revenue, with the amount retained by the distributor
included in cost of systems. In fiscal 1994, the Company
reflects the net amount of distributor revenue in systems
revenue. As the distributor revenue amounts related to
fiscal 1993 are immaterial on both a quarterly and
annualized basis, no reclassifications were made to prior
year financial statements. If reported on a comparable
basis fiscal 1994 software revenue levels declined 5% for
the current quarter, but increased 6% on a year to date
basis, to those revenue levels of the prior year periods.
In order to generate growth and sales momentum, the Company
must continue to capitalize on the trend toward open or UNIX-
oriented software products including those that run on
smaller desktop workstations or personal computers. If the
Company is not successful in continuing to expand its UNIX-
based revenue and product lines over the next several years,
particularly in its ASK Manufacturing Systems business, it
could adversely impact the Company's ability to grow and
sustain its software business. Additionally, the Company
must continue to expand its range of product offerings, gain
more productivity from its sales organization and improve
visibility into its short-term business trends.
Service revenue grew $2,778,000 (7%) and $6,278,000 (5%),
respectively, for the three- and nine-month periods in
fiscal 1994 as compared to the same periods of fiscal 1993.
Growth in the installed license base primarily contributed
to the increases in maintenance, training and consulting
revenue during fiscal 1994. Again, the relative strength of
the U.S. dollar against European currencies (particularly
the British Pound) negatively impacted the 1994 service
revenue trends when compared to 1993.
Approximately 55% and 52%, respectively, of revenue for the
three- and nine-months ended March 31, 1994 was generated
outside North America compared to 50% and 51%, respectively,
for the same periods a year earlier. Management believes
that a portion of this North American revenue shortfall
during the most recent three month period resulted from
purchasing delays by customers because of uncertainty about
the Company's financial condition. When distributor
software revenue is reported on a comparable basis, as
described above, revenue generated outside North America
decreased to 47% and 48%, respectively, for the three- and
nine-month periods ended March 31, 1994.
Because a substantial portion of the Company's international
operations are denominated in foreign currencies
(principally the Pound Sterling), the Company engages in a
foreign currency management program to minimize the effects
of exchange rate fluctuations on foreign cash flows which
are converted to U.S. dollars. This program includes the
use of foreign exchange forward contracts and swaps to hedge
its inter company balances. The program is not intended to
protect any specific area (i.e., revenue) as reported in the
Condensed Consolidated Statements of Operations. Instead it
is intended to minimize the overall impact of exchange rate
fluctuations on the Company's foreign currency cash flows
converted to U.S. dollars. The effect of this program is
included in interest and other income, net, in the Condensed
Consolidated Statements of Operations.
Cost of systems consists primarily of the cost of resold
hardware, royalties to third parties and amortization of
software development costs capitalized under the provisions
of Statement of Financial Accounting Standards No. 86 (FAS
86). As a percentage of the related revenue reported, costs
of systems decreased from 36% and 35%, respectively, in the
three- and nine-month periods of fiscal 1993 to 20% and 22%,
respectively, in the same periods of fiscal 1994. The
decrease primarily results from lower levels of resold third
party hardware. When distributor software revenue and costs
are reported on a comparable basis, as described above,
costs of systems for the fiscal 1993 reporting periods was
30% and 27%, respectively.
Cost of service consists of the direct costs of training and
consulting as well as costs of customer support. Cost of
service remained relatively constant in amount and as a
percentage of the related revenue for the three- and nine-
month periods of fiscal 1993 and 1994.
Product development expenses, net of software development
costs capitalized under the provisions of FAS 86, remained
relatively constant in amount for the three- and nine-months
periods of fiscal 1993 and 1994.
Software development costs capitalized in the three- and
nine-month periods of fiscal 1994 were $2,303,000 and
$9,449,000, respectively, compared to $2,028,000 and
$5,933,000, respectively, for the same periods of fiscal
1993. Costs capitalized under FAS 86 will vary from period
to period depending on the timing and duration of testing of
software products. Before the adjustment related to FAS 86,
product development costs increased 8% to $15,052,000 and
12% to $44,714,000, respectively, for the periods ended
March 31, 1994, as compared to $13,969,000 and $40,058,000,
respectively, for the same periods ended March 31, 1993.
The increase reflects the Company's continuing emphasis on
investment in both new and existing products and is due
primarily to incremental headcount and salary increases over
that of comparable prior year periods. In addition,
capitalized software costs of $2,131,000 were written-off in
conjunction with the Company's restructuring during the
quarter ended March 31, 1994.
Selling, general and administrative expenses for the fiscal
1994 three- and nine-month periods increased $13,825,000 and
$27,681,000, respectively, over that of the comparable
fiscal 1993 periods. Bad debt expense and personnel-related
items, including higher headcount, general increases in
salaries, and outside professional services, accounted for a
substantial portion of these increases in the fiscal 1994
periods. The $4,500,000 increase in bad debt expense for the
three months ended March 31, 1994 reflects the Company's
inability to collect certain receivables and the institution
of more conservative collection policies during the
quarter.
Interest and other income, net, consists of interest income,
foreign exchange gains and losses, foreign exchange hedging
costs and miscellaneous income. For the nine-month periods
ended March 31, 1994 and 1993, the decrease is due primarily
to lower interest income as a result of lower average cash
balances and lower interest rates.
The combination of higher average debt levels and interest
rates resulted in an increase in interest expense in the
fiscal 1994 periods when compared to the fiscal 1993.
The third quarter of fiscal 1994 includes a tax provision of
$3,394,000. The charge primarily relates to the revaluing of
foreign tax credit assets under FAS 109 with no offsetting
tax benefit for U.S. losses. The Company will take the
benefit of current U.S. losses against future U.S. earnings.
This compares to a tax benefit of $1,812,000, for the
comparable quarter of fiscal 1993 which included a tax
benefit on U.S. and certain foreign losses.
The Company's future revenue and earnings may be subject to
significant volatility, especially on a quarterly basis. A
substantial amount of the Company's quarterly revenue has
typically been recorded in the third month of any fiscal
quarter, with a concentration of such revenue in the last
half of that month. In addition, the timing of the closing
of large license agreements increases the risk of quarter-to-
quarter revenue fluctuations. The Company's operating
expenses are based on anticipated revenue, are relatively
fixed in the short term and are incurred approximately
evenly during a quarter. As a result, if revenue is not
realized as expected, the Company's operating results will
be adversely affected.
Any shortfall in revenue or operating results from levels
expected by securities analysts and the timing of the
announcement of such shortfall could have an immediate and
significant effect on the trading price of the Company's
stock in any given period. In addition, the Company
participates in a highly dynamic industry, which often
results in significant volatility in the Company's common
stock price.
Restructuring Charge
For the three months ended December 31, 1993 the Company
recorded a $4,000,000 restructuring charge primarily related
to an 8% reduction in the North American workforce. In
February 1994, following the resignations of two of its
executive officers, and the failure to meet certain
financial test covenants on its unsecured credit agreement
with two banks, the Company announced the formation of a new
management team. After reviewing the Company's business
practices and those of its competitors, the Board of
Directors and the new management team developed a new
operating plan. This plan included additional restructuring
measures designed to align the Company's expense levels with
current and expected revenue. During March 1994, management
completed restructuring plans designed to substantially
strengthen its ongoing cash, expense control and financial
positions under conservative revenue models. The
restructuring plan included a reduction of the Company's
worldwide workforce of approximately 250 people, provided
for the closure and consolidation of certain facilities
worldwide and the write-off of certain non-productive
assets.
The estimated cost of the restructuring plan ($45,000,000)
was recorded by the Company in the third quarter of fiscal
1994 with approximately $6,600,000 of expenses related to
the reduction in workforce. The restructuring charge also
includes approximately $28,300,000 associated with the
closure of excess and redundant facilities and write-offs of
leasehold improvements connected with these facilities, as
well as asset retirements, relocation and related costs.
The remaining $10,100,000 of the restructuring charge arose
from the Company's decision to re-emphasize its core
business, products and markets. As a result, the recorded
value of certain intangible assets acquired in the 1990
Ingres acquisition were written down as the Company now
expected revenue from older Ingres products and the related
customer base to be less than originally anticipated. In
addition, the growth of revenue from new products and
services in an Asian market is now expected to occur at a
lower rate than previously estimated resulting in the
impairment of certain related intangible assets. Finally,
certain older software development projects no longer
important to the core business were ended.
The Company's second and third quarter restructuring
measures are intended to reduce future operating expenses by
approximately $14,000,000 to $15,000,000 per quarter. These
actions will begin to reduce expenses in the fourth quarter
of fiscal 1994; however, their full impact is not expected
to be realized until the first quarter of fiscal 1995.
While the Company intends to limit spending in certain other
areas as well, it expects to increase its Research &
Development programs.
Of the $49,000,000 of restructuring charges recorded during
the nine months ended March 31, 1994, approximately
$5,700,000 required cash expenditures during the period and
$32,100,000 will require future cash outlay. The future
cash requirements for the restructuring are comprised of
about $6,000,000 in connection with the workforce reductions
and $26,100,000 for facilities closures and related costs.
All of the costs related to workforce reductions and about
$13,000,000 of the facilities closure and related costs are
expected to be paid by June 30, 1995. The remaining
$13,100,000 of facilities related costs represents
expenditures to be incurred after June 30, 1995 over the
then remaining terms of leases for facilities which are
expected to be closed and which the Company may not be able
to terminate before the end of the lease term. The Company
anticipates that these cash outlays will be funded by cash
generated from operations.
The $11,200,000 balance of the $49,000,000 charge represents
write-offs of non-productive assets taken at March 31, 1994.
FINANCIAL CONDITION
Cash and cash equivalents increased to $30,804,000 at March
31, 1994 from $18,271,000 at June 30,1993. Cash provided
from operations, principally the collection of outstanding
customer receivables during the most recent quarter, and
bank borrowings accounted for a substantial portion of this
cash increase.
In June of 1992, the Company signed a $50 million term loan
and revolving unsecured credit facility agreement with CIBC
Inc. and The First National Bank of Boston. As previously
reported, the Company was in default of certain of its
financial test covenants as of December 31, 1993. The
Company has not been in default of any of its payment
obligations under that agreement. Following the default,
the Company and the banks began to negotiate a new credit
agreement and the banks conditionally agreed not to exercise
any of their rights under the credit agreement. That
"standstill" agreement required the Company to work closely
with the banks as it developed a new business plan. As of
March 31, 1994, $43,100,000 was outstanding under this
credit facility.
On May 9, 1994, the Company announced that its Board of
Directors and the credit committees of the two lending banks
had formally approved the terms of a new, secured line of
credit. The restructured loan includes both term and
revolver loans totaling $40,000,000 and extends the term of
the credit facility through June 30, 1996. This new
facility will be secured by U.S. assets of the Company and
its subsidiaries. As of the filing of this Form 10-Q, the
Company and the banks were completing the documentation for
the new agreement. See also Note 6 of Notes to Condensed
Consolidated Financial Statements.
While the Company believes that it will have adequate
liquidity through internally generated funds to fund
operations, the Company may seek to raise additional capital
which may include the sale of securities.
<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceedings.
In mid-April 1994, a derivative lawsuit was filed
by a holder of 100 shares of the Company's stock
in the Superior Court of California against ten
current and former directors and officers of the
Company. Because a derivative suit is an action
filed on behalf of and for the benefit of the
Company, the Company is required to be a party and
was, therefore, named as a "nominal defendant."
The plaintiff claims that, during the period
October 22, 1992 through April 2, 1993, the
individual defendants breached their fiduciary
duties, mismanaged the Company, unjustly enriched
themselves and violated California's insider
trading laws by the sale of Company common stock
during the period. The Company has notified its
directors' and officers' liability carriers of the
claim and has retained counsel, and anticipates
filing a response to the complaint within the next
thirty days. The complaint does not seek damages
or any form of relief from the Company.
Item 2. Changes in Securities. Not Applicable
Item 3. Defaults upon Senior Securities. Not Applicable
Item 4. Submission of Matters to a Vote of Security
Holders. Not Applicable
Item 5. Other Information. Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) List of Exhibits
Exhibit
Number Description
11.1 Computation of Net Loss per
Common and Common Equivalent Share
(b) Reports on Form 8-K
None
<PAGE>
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 thereunto duly
authorized.
THE ASK GROUP, INC.
Registrant
May 13, 1994
Date /s/ Gary B. Filler
Gary B. Filler
Executive Vice President of
Operations and Chief
Financial Officer
(Principal Financial
Officer)
/s/ Michael G. Barsotti
Michael G. Barsotti
Corporate Controller and
Treasurer
(Principal Accounting
Officer)
<PAGE>
<TABLE>
EXHIBIT 11.1
THE ASK GROUP, INC.
COMPUTATION OF NET LOSS
PER COMMON AND COMMON EQUIVALENT SHARE
(In thousands, except per share amount)
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Primary
Weighted average number of
common shares outstanding 23,304 22,571 23,104 21,839
Incremental common shares
attributable to shares issuable
under employee stock plans * * * *
Total shares 23,304 22,571 23,104 21,839
Net loss:
Amount $(68,856)$ (674) $ (89,309)$(4,625)
Per share $ (2.95)$ (0.03) $ (3.87)$ (0.21)
Fully Diluted
Weighted average number of
common shares oustanding 23,304 22,571 23,104 21,839
Incremental common shares
attributable to shares issuable
under employee stock plans * * * *
Total shares 23,304 22,571 23,104 21,839
Net loss:
Amount $(68,856)$ (674) $ (89,309)$ (4,625)
Per share $ (2.95)$ (0.03) (3.87)$ (0.21)
<FN>
* Common equivalent shares relating to shares issuable under employee stock
plans are not included due to their antidilutive effect on the loss per
share.
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