<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K - AMENDMENT 1
CURRENT REPORT
Pursuant to Section 13 and 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): November 25, 1996
HALIFAX CORPORATION
(Exact name of registrant as specified in charter)
Virginia 2-84160-W 54-0829246
(State or other jurisdiction
of incorporation) (Commission File Number) (IRS Employer identification
No.)
5250 Cherokee Avenue, Alexandria, Virginia 22312
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (703) 750-2202
Not Applicable
Former name or former address, if changed since last report)
Item 2. Acquisition or Disposition of Assets
(a) On November 25, 1996, Halifax Corporation through its
wholly-owned subsidiary CMS Automation, Inc. ("CMSA") acquired the
ongoing computer network integration business of Consolidated Computer
Investors, Inc. ("CCI") of Hanover, Maryland through an asset
purchase. These computer network integration and business solution
activities will operate as a division of CMSA. The assets purchased
included accounts receivable, inventory and furniture, fixtures and
equipment used in the conduct of the operations. The Company paid
$114,210 in cash and assumed secured debt totaling $1,679,713. The
cash paid was equal to the estimated net assets purchased. The source
of the consideration was the Company's ongoing working capital line of
credit. Under the Uniform Commercial Code of the state of Maryland,
the $114,210 cash proceeds were tendered to an escrow agent for
inclusion in a Bulk Transfer transaction.
Item 7. Financial Statements and Exhibits
(a) Financial Statements of Business Acquired
None.
(b) Pro Forma Financial Information
Unaudited Pro Forma Combined Condensed Financial Statements
The following unaudited pro forma combined condensed financial
statements have been prepared by Halifax's management from the
consolidated financial statements of Halifax and CCI. The Unaudited
Pro Forma Combined Condensed Statement of Earnings for a full year
period reflects adjustments as if the CCI asset purchase transaction
had occurred on April 1, 1995. In order to provide comparability of
operations data, the Unaudited Pro Forma Combined Condensed Statement
of Earnings for the full fiscal year includes data for the effect of
the CMSA acquisition made by Halifax effective April 1, 1996 and
reported on SEC Form 8-K on April 15, 1996. A second Statement of
Earnings is included for the six month period ending September 30,
1996 and reflects adjustments as if the CCI asset purchase transaction
had occurred on April 1, 1996. This six month statement of earnings
includes CMSA's historical results of operations in the consolidated
Halifax historical data. The Unaudited Pro Forma Combined Condensed
Balance Sheet reflects adjustments as if the CCI asset purchase
transaction had occurred on September 30, 1996. See "Note 1 - Basis
of Presentation." The unaudited pro forma adjustments described in
the accompanying notes are based upon preliminary estimates and
certain assumptions that management of Halifax believes are reasonable
in the circumstances.
The unaudited pro forma combined condensed financial statements are
not necessarily indicative of financial position or results of
operations that would have resulted if the asset purchase transaction
had occurred on the applicable dates indicated above. Moreover, they
are not intended to be indicative of future results of operations or
financial position. The pro forma combined condensed financial
statements should be read in conjunction with the historical
consolidated financial statements of Halifax and related notes
thereto, included in the Corporation's Annual Report on Form 10-K for
the year ended March 31, 1996 and the Corporation's Quarterly Reports
on Form 10-Q for the periods ended June 30, 1996 and September 30,
1996.
<PAGE>
<TABLE>
Unaudited Pro Forma Combined Condensed Statement of Earnings
<CAPTION>
For the Six Months Ended
Sept. 30, Sept. 30, Proforma Proforma
1996 1996 Adjustments Combined
Halifax CCI
($ In thousands, except per share data)
<S> <C> <C> <C> <C>
Revenues $36,171 $6,763 $- $42,934
Operating Costs and
Expenses:
Cost of Services 32,287 5,674 (184)b 37,777
Selling, General and 2,421 1,043 (4)ch 3,468
Administrative Expenses
Total Operating Costs and 34,708 6,717 (180) 41,245
Expenses
Operating Income 1,463 46 180 1,689
Interest Expense 492 163 (79)d 576
Other Income (Expense), Net - 1 - 1
Income Before Income Taxes 971 (116) 259 1,114
Income Taxes 383 (46) 102e 439
Net Income/(Loss) $588 $(70) $157 $675
Earnings per Share* $.30 N/A $
.34
Weighted Average Number of
Common Shares Outstanding* #1,973,063 N/A #1,973,063
<FN>
Six month results for CCI and the related proforma adjustments have
been prepared on a prorata basis using the December 31,1995 twelve
month results included in this Form 8-K.
*Takes into effect 3:2 Halifax common stock split effective December
27, 1996.
See accompanying notes to unaudited pro forma combined condensed
financial statements
</FN>
</TABLE>
<PAGE>
<TABLE>
Unaudited ProForma Combined Condensed Balance Sheet
<CAPTION>
As of
Sept. 30, 1996 Oct. 31, 1996 proforma Proforma
Halifax CCI Adjustments Combined
($ In thousands)
<S> <C> <C> <C> <C>
Current Assets:
Cash & Cash Equivalents $599 $- $(114)a $485
Receivables, Net 21,749 1,386 - 23,135
Inventory, Net 5,838 200 - 6,038
Other Current Assets 593 - - 593
Total Current Assets 28,779 1,586 (114) 30,251
Property & Equipment, Net 5,798 231 - 6,029
Costs in Excess of Net
Assets 2,941 - 368ah 3,309
Acquired & Other Assets
Total Assets $37,518 $1,817 $254 $39,589
Liabilities and
Stockholders' Equity:
Current Liabilities:
Accounts Payable & Accrued $13,042 $- $- $13,042
Expenses
Current Maturities Debt 1,025 1,686 - 2,711
Unearned Revenues & Other - 227 - 227
Total Current 14,067 1,913 15,980
Liabilities
Long-Term Operating Debt $9,867 $- - 9,867
Mortage Note 2,590 - - $2,590
Other Liabilities 666 4 161a 831
Total Liabilities 27,190 1,917 161 29,268
Stockholders' Equity:
Common Stock 526 - - 526
Additional Paid-In Capital 4,353 - - 4,353
Treasury Stock at Cost (213) - - (213)
Retained Earning (Deficit) 5,662 - (7)h 5655
Total Stockholders' 10,328 - (7) 10,321
Equity
Total Liabilities & $37,518 $1,917 $154 $39,589
Stockholders' Equity
<FN>
See accompanying notes to unaudited pro forma combined condensed
financial statements
</FN>
</TABLE>
<TABLE>
Unaudited Pro Forma Combined Condensed Statement of Earnings
<CAPTION>
For the
Year
Ended
March Dec 31, Dec. 31,
31, 1996 1995 Proforma Proforma 1995 Proforma Proforma
Halifax CMSA Adjustment Combined CCI Adjustments Combined
($ In thousands, except per share data)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues $47,159 $21,249 $- $68,408 $13,526 $- $81,934
Operating Costs and
Expenses:
Cost of Services 41,675 14,582 - 56,257 11,348 (368)b 67,237
Selling, General and 3,650 6,300 14f 9,964 2,086 9ch 12,059
Administrative
Expenses
Total Operating Costs 45,325 20,882 14 66,221 13,434 (359) 79,296
and Expenses
Operating Income 1,834 367 (14) 2,187 92 359 2,638
Interest Expense 573 543 (240)g 876 325 (158)d 1,043
Other Income (Expense), - 68 - 68 1 - 69
Net
Income before Income Taxes 1,261 (108) 226 1,379 (232) 517 1,664
Income Taxes 498 1 89e 588 (92) 204e 700
Net Income (Loss) $763 $(109) $137 $791 $(140) $313 $964
Eanings per Share* $.43 N/A $.40 N/A $.49
Weighted Average Number of
Common #1,756,881 N/A #1,966,326 N/A #1,966,326
Shares Outstanding*
<FN>*Takes into effect 3:2 Halifax common stock split effective
December 27, 1996
See accompanying notes to unaudited pro forma combined condensed
financial statements
</FN>
</TABLE>
<PAGE>
NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying Unaudited Pro Forma Combined Condensed Statement of
Earnings is presented for a full fiscal year and a six-month period.
The full fiscal year presentation presents the historical results of
operations of Halifax for its fiscal year ended March 31, 1996, the
historical results of operations of CMSA for its fiscal year ended
December 31, 1995 with pro forma adjustments as if the acquisition
transaction had been consummated as of April 1, 1995 and the
historical results of operations for CCI for its fiscal year ended
December 31, 1995 with pro forma adjustments as if the asset purchase
transaction had been consummated as of April 1, 1995. The six-month
presentation presents the consolidated historical results of
operations of Halifax including CMSA for the six-month period ended
September 30, 1996 and the financial results of CCI estimated on a pro
rata basis using the historical results of operations for CCI for its
fiscal year ended December 31, 1995 with pro forma adjustments as if
the asset purchase transaction had been consummated as of April 1,
1996. The Unaudited Pro Forma Combined Condensed Balance Sheet
presents the historical balance sheet of Halifax as of September 30,
1996 and the historical assets and liabilities of CCI as of October
31, 1996 acquired on November 25, 1996, with pro forma adjustments as
if the asset purchase transaction had been consummated as of September
30, 1996, in a transaction accounted for as a purchase in accordance
with Generally Accepted Accounting Principles.
2. Pro Forma Adjustments
Unaudited Pro Forma Combined Condensed Balance Sheet
a. To record the consideration assumed to be exchanged for the
purchased assets consisting of cash and the assumption of certain
liabilities of CCI and to record the estimated expense of the
transaction.
Unaudited Pro Forma Combined Condensed Statements of Earnings
To record estimated effects of changes in operations of CCI
including cost of services, selling, general & administrative costs
and interest expense at Halifax's cost of borrowing under its
borrowing agreement, resulting from the assumption of secured debt
payable:
b. Reduction in Cost of Services from changes in salaries and
fringe benefits, improved hardware purchase margins, commission plan
and lease changes.
c. Reduction in Selling, General & Administrative charges
from changes in accounting and legal services, depreciation, vehicles.
d. Net Reduction in CCI interest expense due to conversion of
secured debt to Halifax borrowing rates.
e. To record the total income tax effect, using a 39.5% rate,
on the net proforma adjustments.
f . To record the amortization of estimated cost in excess of
net assets including capitalizable acquisition cost acquired in the
CMSA transaction over an estimated life of 25 years.
g To record estimated interest expense at Halifax's cost of
borrowing under its borrowing agreement, resulting from the assumption
of the CMSA short-term debt and the conversion of the CMSA long-term
notes payable.
h. To record the amortization of estimated cost in excess of
net assets including capitalizable expenses acquired in the CCI asset
purchase over an estimated life of 25 years.
C. Exhibits
None.
<PAGE>
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 thereunto duly authorized.
HALIFAX CORPORATION
(Registrant)
Date: February 12, 1997 By: s/Howard C. Mills
Howard C. Mills, President
& Chief Executive Officer
Date: February 12, 1997 By: s/John D. D'Amore
John D. D'Amore
V.P. Finance & Accounting
