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SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
CURRENT REPORT
on
FORM 8-K/A
(Amendment No. 2)
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: November 14, 1994
AMERIQUEST TECHNOLOGIES, INC.
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(Exact name of registrant as specified in charter)
Delaware
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(State of other jurisdiction of incorporation)
1-10397 33-0244136
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(Commission File Number) (IRS Employer Identification No.)
2722 Michelson Drive, Irvine, CA 92715
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(Address of principal executive offices) (Zip Code)
(714) 222-6000
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(Registrant's telephone number, including area code)
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(Former name or former address, if changed since last report)
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Item 2. Acquisition or Disposition of Assets
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Effective November 14, 1994, AmeriQuest Technologies, Inc. ("AQS") issued
1,864,767 shares of its Common Stock and $3,473,312 in exchange for 100% percent
of the issued and outstanding equity securities of Ross White Enterprises, Inc.
d/b/a "National Computer Distributors" ("NCD").
NCD is a national value-added distributor of microcomputer systems,
peripherals and accessories. Its key vendors include Acer, AST, Leading Edge
and Canon.
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Item 5. Other Events
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AQS and Computer 2000 AG ("Computer 2000"), a company duly organized under
the laws of the Federal Republic of Germany, entered into an agreement dated
November 14, 1994 (the "Investment Agreement") pursuant to which Computer 2000
agreed to invest approximately $50 million in AQS in exchange for an
approximately 51 percent ownership interest in AQS, including shares already
owned by Computer 2000. The transaction has been approved by the boards of both
companies, and is subject to approval by the stockholders of AQS and to certain
regulatory approvals.
Under the terms of the Investment Agreement and the related Loan Agreement,
Computer 2000 will initially extend to AmeriQuest 2000, Inc., a Delaware
corporation and a wholly-owned subsidiary of AQS ("Sub"), a loan of $13 million
with an additional $5 million to follow within 45 days if Computer 2000 is
satisfied with a due diligence review of AQS's inventories and accounts
receivable (the "Loan"). Sub's repayment obligations under the Loan will be
satisfied by AQS's issuance to Computer 2000 of up to 8,108,108 shares of its
Common Stock at a conversion rate of $2.22 per share, subject however to
approval thereof by AQS's stockholders. The Investment Agreement further
provides that, subject to certain conditions, on or before September 1, 1995,
Computer 2000 will invest an additional $32 million in AQS in exchange for 14.1
million additional newly issued shares of its Common Stock, bringing Computer
2000's total ownership interest to approximately 22.9 million shares or 51% of
the total outstanding shares of AQS. The $32 million investment is contingent
upon a number of conditions, including but not limited to AQS's meeting certain
monthly and cumulative after-tax operating profitability conditions during the
first half of calendar 1995. AQS will also issue to Computer 2000 an option to
purchase additional shares of AQS in an amount equal to the number of AQS's
shares issuable upon exercise of currently outstanding options and warrants and
conversion of any other convertible securities. All newly issued shares of AQS
will be subject to resale restrictions under Rule 144 of the Securities Act of
1933, but will carry registration rights.
The preceding summary of certain of the material terms of the Investment
Agreement and Loan Agreement, which are attached hereto as Exhibits 2.03 and
2.04, respectively, is not intended to be complete and is qualified by reference
to the Investment Agreement and Loan Agreement.
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Item 7. Financial Statements and Exhibits
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(a) The financial statements of NCD required to be filed pursuant to
Item 7(a) of Form 8-K are attached hereto and incorporated herein by
this reference.
(b) The pro forma financial information for NCD required to be filed
pursuant to Item 7(b) of Form 8-K and Rule 601 of Regulation S-K are
attached hereto and incorporated herein by this reference, including:
Pro Forma Condensed Balance Sheet at September 30, 1994
Pro Forma Condensed Statements of Operations for the fiscal year
ended June 30, 1994.
Pro Forma Condensed Statements of Operations for the fiscal
quarter ended September 30, 1994.
(c) Exhibit No. Description of Exhibit
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2.02* Agreement and Plan of Reorganization dated September
26, 1994 by, between and among AQS, Ross White
Enterprises, Inc. d/b/a "National Computer
Distributors" ("NCD") and the shareholders of NCD.
(Filed as Exhibit 2.02 to the Annual Report on Form
10-K/A of AQS for the year ended June 30, 1994)
2.03* Investment Agreement dated as of November 14, 1994 by
and between AQS and Computer 2000 AG. (Filed with the
original Current Report on Form 8-K of AQS for
November 14, 1994.)
2.04* Loan Agreement dated as of November 14, 1994 by and
between Computer 2000 AG and AmeriQuest 2000,Inc.
(Filed with the original Current Report on Form 8-K
of AQS for November 14, 1994.)
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* Incorporated herein by this reference pursuant to Rule 12b-32 under the
Securities Exchange Act of 1934, as amended, and Rule 24 of the Commission's
Rules of Practice.
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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.
AMERIQUEST TECHNOLOGIES, INC.
/s/ Stephen G. Holmes
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Stephen G. Holmes,
Secretary, Treasurer and
Chief Financial Officer
Dated: February 8, 1995
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AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED BALANCE SHEET
September 30,1994 (Unaudited)
(Dollars in thousands except shares)
(Dollars in thousands, except
per share data)
ASSETS
<TABLE>
<CAPTION>
AmeriQuest Pro Forma Pro Forma
Technologies, Inc. NCD Adjustments Combined
------------------ -------- ----------- ---------
<S> <C> <C> <C> <C>
CURRENT ASSETS
Cash $ 1,378 $ 127 $ 3,608 (F,G) $ 5,113
Accounts receivable, net 42,687 21,203 0 63,890
Inventories 47,291 27,369 0 74,660
Income taxes receivable 0 24 0 24
Prepaid expenses and other 1,668 1,920 0 3,588
-------------- -------- ----------- ---------
Total current assets 93,024 50,643 3,608 147,275
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PROPERTY AND EQUIPMENT, NET 5,831 965 0 6,796
INTANGIBLE ASSETS, NET 6,426 56 8,934 (F) 15,416
OTHER ASSETS 1,449 695 0 2,144
-------------- -------- ----------- ---------
$106,730 $52,359 $ 12,542 $171,631
============== ======== =========== =========
</TABLE>
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
AmeriQuest Pro Forma Pro Forma
Technologies, Inc. NCD Adjustments Combined
------------------ -------- ----------- ---------
<S> <C> <C> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 29,722 $27,715 $ 0 $ 57,437
Notes payable 43,211 20,593 (11,287)(G,F) 52,517
Other 5,358 54 2,954 (G,F) 8,366
-------------- -------- ----------- --------
Total current liabilities 78,291 48,362 (8,333) 118,320
-------------- -------- ----------- --------
LONG-TERM DEBT 0 2,737 (2,737) 0
OTHER NONCURRENT LIABILITIES 0 0 0 0
DEFERRED INCOME TAXES 267 0 0 267
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value;
authorized 10,000,000 shares;
issued and no shares issued
and outstanding 0 0 0 0
Common stock, $.01 par value;
authorized 30,000,000 shares;
issued and outstanding
17,136,935 shares 171 0 115 (G,F) 286
Common stock, $.01 par value;
authorized 10,000,000 shares;
issued and outstanding
4,599,180 shares 0 0 0 0
Common stock, $.01 par value;
authorized 10,000,000 shares;
issued and outstanding 195 shares 0 0 0 0
Additional paid-in capital 43,683 2,096 22,661 (G,F) 68,440
Retained deficit (15,682) (836) 836 (G,F) (15,682)
-------------- -------- ----------- --------
Total stockholders' equity 28,172 1,260 23,612 53,044
-------------- -------- ----------- --------
$106,730 $52,359 $ 12,542 $171,631
============== ======== =========== ========
OUTSTANDING COMMON
SHARES 17,136,935 28,649,810
============== ==========
</TABLE>
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AMERIQUEST TECHNOLOGIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For year ended June 30, 1994
(Unaudited)
(Dollars in thousands, except
per share data)
<TABLE>
<CAPTION>
AmeriQuest Pro Forma Pro Forma
Technologies, Inc.(A) NCD Adjustments Combined
--------------------- --------- ----------- -------------
<S> <C> <C> <C> <C>
NET SALES $ 394,798 $218,808 $ 0 (D) $ 613,606
COST OF SALES 359,702 202,114 0 561,816
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Gross profit 35,096 16,694 0 51,790
OPERATING EXPENSES
Selling, general and administrative 61,979 13,259 893 76,131
Restructuring charge and
earthquake loss 9,130 0 0 9,130
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71,109 13,259 893 85,261
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Income (loss) from operations (36,013) 3,435 (893) (33,471)
OTHER INCOME (EXPENSE)
Other income 71 0 0 71
Interest expense (4,587) (1,908) 930 (B) (5,565)
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(4,516) (1,908) 930 (5,494)
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Income (loss) before taxes (40,529) 1,527 37 (39,965)
PROVISION FOR INCOME TAXES (797) 0 0 (797)
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Net income (loss) (D) $ (39,732) $ 1,527 $ 37 $ (38,168)
============= ======== ======== ===========
Net income (loss) per common share $ (3.03) $ 7.83 $ (1.55)
============= ======== ===========
Common and common equivalent shares 13,105,281 195 24,618,156
============= ======== ===========
</TABLE>
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AMERIQUEST TECHNOLOGIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For three months ended September 30, 1994
(Unaudited)
(Dollars in thousands, except per share data)
(Dollars in thousands, except
per share data)
<TABLE>
<CAPTION>
AmeriQuest Pro Forma Pro Forma
Technologies, Inc. Robec, Inc. NCD Adjustments Combined
------------------ ----------- --------- ----------- ---------
<S> <C> <C> <C> <C> <C>
NET SALES $ 49,476 22,351 $ 61,364 $ 0(D) $133,191
COST OF SALES 44,704 20,366 56,628 0 121,698
--------- -------- -------- -------- --------
Gross profit 4,772 1,985 4,736 0 11,493
OPERATING EXPENSES
Selling, general and administrative 5,222 2,500 3,582 274 11,578
Research and development 3 0 0 0 3
--------- -------- -------- -------- --------
5,225 2,500 3,582 274 11,581
Income (loss) from operations (453) (515) 1,154 (274) (88)
OTHER INCOME (EXPENSE)
Other income 67 0 0 0 67
Interest expense (727) (201) (669) 233 (B) (1,364)
--------- -------- -------- -------- --------
(660) (201) (669) 233 (1,297)
--------- -------- -------- -------- --------
Income (loss) before taxes (1,113) (716) 485 (41) (1,385)
PROVISION FOR INCOME TAXES 0 0 0 0 0
--------- -------- -------- -------- --------
Net income (loss) (1,113) (716) 485 (41) (1,385)
Net income (loss) per common share $ (0.10) $ (0.05)
========= ========
Weighted average shares 11,622,873 29,691,169
========== ==========
</TABLE>
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FOOTNOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS OF AMERIQUEST TECHNOLOGIES, INC. AND ROBEC INC.
The following footnotes reflect the assumptions made in the preparation of the
Pro Forma Condensed Consolidated Financial Statements.
(A) Gives effect to the acquisitions of Kenfil, Inc. and 50.1% of the issued
and outstanding stock of Robec, Inc. as indicated in the Form 8-K/A dated
September 12, 1994.
(B) Savings of interest expense on notes payable and long-term debt retired
through the issuance of AmeriQuest Common Stock, interest ranging from 9.5%
to 13.91%. See Footnotes (F) and (G) below.
(C) The restructuring charge and earthquake loss of $9,130,000 included in
AmeriQuest's historical statement of operations includes $5,700,000 which
relates principally to the write-off of certain former personal computer
joint venture operations at Kenfil; charges of $866,000 relating to
severance costs and lease termination costs; charges of $336,000 relating
to a reduction in office and warehouse space at Robec; and $3,430,000 for
losses sustained by Kenfil in the Southern California earthquake.
(D) On July 8, 1994, AmeriQuest reacquired 345,091 shares of its Common Stock
from Mr. James D'Jen, a former officer and director of AmeriQuest, as down
payment on an obligation of Mr. D'Jen to exchange 350,000 shares of
AmeriQuest Common Stock, in exchange for all (100%) of the common stock of
AmeriQuest's Singapore subsidiary, CMS Enhancements (S) PTE Ltd. The
Singapore subsidiary is a distributor of commodity disk drives. Sales for
this Singapore subsidiary approximate $20 million annually, with an
approximate breakeven in operating results. Upon the receipt of the
balance of the shares due from Mr. D'Jen, AmeriQuest will be divested of
its Singapore subsidiary.
(E) During fiscal year 1994 AmeriQuest acquired two companies, the impact of
which would be an increase of approximately $20 million in revenues for the
six months not reflected in historical results, with an approximate
breakeven in operating results.
(F) To effect the purchase of NCD, AmeriQuest issued 1,864,767 shares of
AmeriQuest Common Stock plus paid cash of $6,674,263 (including the
redemption of subordinate indebtedness of approximately $3 million) in
exchange for all 195 outstanding shares of NCD Common Stock and to
eliminate NCD's historical equity. The AmeriQuest Common Stock is assumed
to have market value of $1.75 per share at the time of the transaction for
a total purchase price, including debt redemption, of $9,937,605. This
purchase price exceeds the fair value of the net assets acquired resulting
in goodwill of approximately $8.9 million. Such shares are reflected in
the accompanying pro forma financial statements as outstanding common stock
owned by AmeriQuest.
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(G) The $18 million advance from Computer 2000 AG to the Company for the
purchase of 8.1 million shares of AmeriQuest Common Stock is reflected as
equity in the accompanying pro forma financial statements. This
transaction is subject to approval by AmeriQuest's shareholders. Computer
2000 has agreed, subject to certain conditions, to invest an additional $32
million for an approximately 51 percent ownership interest in AmeriQuest,
including shares already owned by AmeriQuest and assuming consummation of
the Merger. In addition, AmeriQuest completed a private placement of
equity securities in October, 1994 providing net proceeds of $3,608,000.
The aggregate proceeds were used to fund the cash portion of the NCD
purchase price, repayment of notes payable and the redemption of NCD's
subordinated indebtedness.
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