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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of report (Date of earliest event reported): July 20, 2000
PERCEPTRONICS, INC.
(Exact Name of Registrant as Specified in Charter)
DELAWARE 000-12382 95-2577731
(State or Other Jurisdiction of (Commission (I.R.S. Employer
Incorporation or Organization) File Number) Identification Number)
21010 Erwin Street, Woodland Hills, California 91367
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (818) 884-7470
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Perceptronics, Inc. (the "Company") reported that it had completed the
previously announced sale of its precision gunnery training systems ("PGTS") and
training simulator operation to Eidetics Corporation, a manufacturer of aircraft
simulators and other simulation systems based in Torrance, California.
The transaction included, among other things: (1) transfer to Eidetics of
the PGTS assets; (2) payment or assumption by Eidetics of certain liabilities of
the Company associated with the PGTS business; (3) transfer by the Company to
Eidetics of active contracts and/or proposals in the area of PGTS and training
simulator operations; and (4) payment by Eidetics to the Company for four years
of a royalty on all Eidetics business involving the PGTS assets and/or transfer
of the PGTS contracts and proposals. The approximate value of the transaction
was $500,000.
As part of the shareholder approval process, Perceptronics filed with the
SEC an information statement describing in more detail the terms of the
transaction. Copies may be obtained from the SEC's website at www.sec.gov or
from the Company at no cost.
Perceptronics' business is to develop, produce and market software products
and services that allow website developers and owners to create online
collaborative experiences that meet the growing demand for expanded multi-user
interactivity on the Internet. A description of the Company's IC3D Technology is
found at http://ic3d.perceptronics.com.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
a. Financial statements - not applicable.
b. Pro forma financial information.
1) Perceptronics, Inc. pro forma condensed consolidated balance sheet
as of March 31, 2000 (unaudited).
2) Perceptronics, Inc. pro forma condensed consolidated statement of
income for the year ended March 31, 2000 (unaudited).
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PERCEPTRONICS, INC. AND SUBSIDIARY
PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On July 20, 2000, Perceptronics, Inc. and Subsidiary completed the sale of its
Precision Gunnery Training System (PGTS) and training simulator product line to
Eidetics Coporation, a Torrance, CA based manufacturer of aircraft simulators
and other simulations systems. The transaction included, among other things: 1)
transfer to Eidetics of the PGTS Assets; 2) payment or assumption by Eidetics of
certain liabilities of the Company associated with the PGTS Business; 3)
transfer by the Company to Eidetics active contracts and/or proposals in the
area of PGTS and training simulator operations and 4) payment by Eidetics to the
Company for four years of a royalty on all Eidetics business involving the PGTS
Assets and/or transfer of the PGTS contracts and proposals.
The transaction will be recorded as a gain on sale of assets sold at their fair
values.
The accompanying condensed consolidated financial statements illustrate the
effect of the disposition ("Pro Forma") on the Company's financial position and
results of operations. The condensed consolidated balance sheet as of March 31,
2000 is based on the historical balance sheet of the Company as of that date and
assumes the acquisition took place on that date. The condensed consolidated
statement of income for the year ended March 31, 2000 are based on historical
statements of income of the Company for that period. The pro forma condensed
consolidated statement of income assumes the acquisition took place on April 1,
1999.
The pro forma condensed consolidated financial statements may not be indicative
of the actual results of the sale. In particular, the pro forma financial
statements are based on management's current estimate of the sale price, the
actual sale price may differ.
The accompanying condensed consolidated pro forma financial statements should be
read in connection with the historical statements of Perceptronics, Inc. and
Subsidiary.
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PERCEPTRONICS, INC. AND SUBSIDIARY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
MARCH 31, 2000
<TABLE>
<CAPTION>
Historical Pro Forma Pro Forma
statements adjustments results
---------- ----------- ----------
<S> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
Cash and short term investments ................ $ 355,781 $ 355,781
Restricted cash ................................ -- --
Receivables
Billed ....................................... -- --
Unbilled ..................................... 10,501 10,501
Other receivables ............................ 72 72
Inventory ...................................... 80,620 (80,620)(1) --
Pre-contract Costs ............................. 220,000 (220,000)(1) --
Prepaid expenses ............................... 17,620 17,620
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TOTAL CURRENT ASSETS: .......................... 684,594 383,974
Equipment & Leasehold Improvements, at cost less
accumulated depreciation ...................... 38,039 (12,367)(1) 25,672
Deferred Taxes ................................. 932,566 932,566
Other Assets ................................... 82,930 (6,700)(1) 76,230
---------- ----------
TOTAL ASSETS ................................... $1,738,129 $1,418,442
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY:
CURRENT LIABILITIES:
Current portion of long term debt .............. $ 105,886 (66,523)(1) $ 39,363
Short term debt ................................ 54,000 54,000
Accounts payable ............................... 588,211 (235,595)(1) 352,616
Accrued compensation ........................... 172,499 172,499
Other accrued liabilities ...................... 121,437 (7,980)(1) 113,457
---------- ----------
TOTAL CURRENT LIABILITIES: ..................... 1,042,033 731,935
LONG-TERM LIABILITIES:
Long term debt, net of current portion ......... 103,029 (103,029)(1) --
Other long term liabilities .................... 57,500 (57,500)(1) --
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TOTAL LIABILITIES .............................. $1,202,562 $ 731,935
========== ==========
SHAREHOLDERS' EQUITY: 535,567 150,940 (1) 686,507
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ..... $1,738,129 $1,418,442
========== ==========
</TABLE>
See Notes to Pro Forma Consolidated Financial Statements (Unaudited)
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PERCEPTRONICS, INC. AND SUBSIDIARY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
FOR THE YEAR ENDED MARCH 31, 2000
<TABLE>
<CAPTION>
Historical Pro Forma Pro Forma
statements adjustments results
---------- ----------- -----------
<S> <C> <C> <C>
Net Sales ......................... $ 720,985 $ 720,985
Cost of Sales ..................... 886,223 (288,198) (2) 598,025
----------- -----------
Gross Profit ...................... (165,238) 122,960
Costs and expenses:
Selling, general and administrative 770,809 (128,523) (3) 642,286
Research & development ............ 195,800 195,800
----------- -----------
Operating (loss) .................. (1,131,847) (715,126)
Interest expense .................. 39,881 (34,009) (4) 5,872
Gain on sale of assets ............ -- 150,940 (5) 150,940
Income (loss) before taxes ........ (1,171,728) (570,058)
Income tax provision .............. 800 800
Net Income ........................ (1,172,528) (570,858)
=========== ===========
EARNINGS PER SHARE:
Basic: .......................... (0.18) (0.09)
=========== ===========
Net (loss)
Diluted: ........................ N/A N/A
=========== ===========
WEIGHTED AVERAGE COMMON AND COMMON
EQUIVALENT SHARES:
Basic ............................. 6,681,095 6,681,095
=========== ===========
Diluted ........................... N/A N/A
=========== ===========
</TABLE>
See Notes to Pro Forma Consolidated Financial Statements (Unaudited)
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PERCEPTRONICS, INC. AND SUBSIDIARY
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE A-THE PRO FORMA ADJUSTMENTS TO THE CONDENSED CONSOLIDATED BALANCE SHEET
ARE AS FOLLOWS:
1) To reflect the sale to Eidetics, a California coporation, of all assets of
Perceptronics related to Precision Gunnery Training System (PGTS) product
line and technologies on the basis of the fair values of the assets sold
and liabilities assumed by Eidetics. The components of the purchase
agreement (Eidetics purchase of the assets and assumption liabilities) are
as follows:
<TABLE>
<S> <C>
Components of assets purchased:
Inventory $ 80,620
Precontract costs 220,000
Equipment & Leaseholds 12,367
Other Assets 6,700
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Total of assets purchased $ 319,687
Components of liabilities assumed:
Current portion of long term debt $ 66,523
Accounts payable 235,595
Other accrued liabilities 7,980
Long-term debt 103,029
Other long term liabilities 57,500
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Total of liabilities assumed $ 470,627
Gain in excess of net assets sold $ 150,940
==========
</TABLE>
NOTE B-THE PRO FORMA ADJUSTMENTS TO THE CONDENSED CONSOLIDATED STATEMENTS OF
INCOME ARE AS FOLLOWS:
<TABLE>
<CAPTION>
Year ended
March 31, 2000
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<S> <C>
(2) Adjustments to costs of goods sold:
Direct costs $ 139,780
Manufacturing material 3,644
Fringe allocation 24,178
Utilities 7,045
Rent 79,350
Property taxes 1,000
General insurance 12,000
Depreciation 21,201
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$ 288,198
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</TABLE>
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PERCEPTRONICS, INC. AND SUBSIDIARY
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(3) Adjustments to selling and administrative relate cost attributable to PGTS
product line.
(4) Adjustments to interest expense reflect the decrease in notes payable
assumed by the purchaser Eidetics, Corporation.
(5) To report gain on sale of assets.
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c. Exhibits:
Number Exhibit
------ -------
2.1 Agreement of Purchase for the Precision Gunnery Training
Systems Assets, dated as of May 31, 2000, by and between
Eidetics Corporation and Perceptronics, Inc.
2.2 Amendment No. 1 to Agreement of Purchase for the Precision
Gunnery Training Systems Assets, dated as of July 20, 2000,
by and between Eidetics Corporation and Perceptronics, Inc.
99.1 Press Release, dated July 20, 2000, announcing the
completion of the sale of the Precision Gunnery Training
Systems Assets.
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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.
PERCEPTRONICS, INC.
Date: August 4, 2000 By: /s/ Gershon Weltman
---------------------------------
Gershon Weltman
Chairman, President
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