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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: December 12, 2000
(Date of earliest event reported) (November 7, 2000)
UNICOMP, INC.
(Exact name of registrant as specified in its charter)
COMMISSION FILE NUMBER: 0-15671
COLORADO 84-1023666
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1850 PARKWAY PLACE, SUITE 925
MARIETTA, GEORGIA 30067
(Address of principal executive offices including zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (770) 424-3684
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Effective as of November 8, 2000 (the "Closing Date"), UniComp, Inc.
(the "Company"), through its wholly-owned subsidiary, UniComp Computing Group
Limited, sold all of the issued and outstanding shares of capital stock (the
"Shares") of the Company's Northern Ireland subsidiary, Unibol Limited ("Unibol
UK"), to California Software Corporation (the "Sale"). Unibol UK develops,
markets, and sells IBM Midrange migration software. The Sale was consummated in
accordance with the terms of that certain Stock Purchase Agreement between
Unibol Limited, ICS Computing Group Limited, UniComp, Inc., and California
Software Corporation ("CSC"), dated effective as of November 8, 2000, as amended
on November 10, 2000 (the "Sale Agreement").
In consideration of the Sale, CSC (i) paid $1,000,000 at closing in
cash to UniComp, Inc., (ii) an additional $500,000, in cash is payable to
UniComp, Inc. in equal monthly installments over four months with each
installment payment due on or before the first of each month beginning with the
second month after that in which the Closing Date falls (e.g., if the Closing
Date is November 8, 2000, then the first installment is due on or before
December 1, 2000), and (iii) $1,500,000 is payable to UniComp, Inc. in CSC
common stock on the six month anniversary of the Closing Date. Regarding item
(ii), CSC has taken the position that the first of the four installment payments
is due January 1, 2001; the Company disputes such claim and is taking the
position that the first payment was due December 1, 2000 as stated in the
parenthetical example.
CSC has now claimed that it has purchased Unibol, Inc. in the Sale. The
Company disputes CSC's claim and has filed suit against CSC in connection with
this dispute. Further, as described in Item 5 below, merger talks with CSC have
been terminated.
ITEM 5. OTHER EVENTS
On November 7, 2000, the Company entered into a Letter of Intent to merge with
CAWC. Subsequently, merger talks were terminated.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Not Applicable.
(b) Pro Forma Financial Information.
INTRODUCTION
The accompanying unaudited pro forma condensed combined financial
statements are based on the historical presentation of the consolidated
financial statements of the Company. The unaudited pro forma balance
sheet as of August 31, 2000 gives effect to the Sale as if it occurred
on August 31, 2000. The unaudited pro forma statements of operations
for the year ended February 29, 2000 and six months ended August 31,
2000 give effect to the Sale as if it had occurred March 1, 1999, and
reflect only the results from continuing operations.
The unaudited pro forma financial information is presented for
informational purposes only and is not necessarily indicative of the
financial position and results of operations that would have been
achieved had the Sale been completed as of the dates indicated and is
not necessarily indicative of the Company's future financial position
or results of operations.
The unaudited pro forma combined financial statements should be read in
conjunction with the historical consolidated financial statements and
notes thereto of the Company.
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UNAUDITED PRO FORMA COMBINED BALANCE SHEET
AS OF AUGUST 31, 2000
(in thousands)
<TABLE>
<CAPTION>
UNICOMP PRO FORMA
CONSOLIDATED ADJUSTMENTS PRO FORMA
------------ ----------- ---------
<S> <C> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents 392 (2)a 1,390
1,000 b
Accounts and other receivables: 4,663 (1,601)a 3,562
500 b
2,374 c
(2,374)c
Inventories 3,736 3,736
Prepaid expenses and other 655 (82)a 573
------------ ----------- ---------
Total current assets 9,446 (185) 9,261
PROPERTY AND EQUIPMENT, NET 3,805 (261)a 3,544
OTHER ASSETS:
Acquired and developed software, net 6,486 (5,100)a 1,386
Goodwill and other intangibles, net 3,446 (325)d 3,121
Other assets 1,688 1,500 b 3,188
------------ ----------- ---------
Total other assets 11,620 (3,925) 7,695
Total assets 24,871 (4,371) 20,500
============ =========== =========
CURRENT LIABILITIES:
Accounts payable 3,624 (420)a 3,204
Accrued expenses 1,834 (464)a 1,670
300 e
Deferred revenue 1,208 (369)a 839
Lines of credit 4,173 4,173
Other 1,436 (339)a 1,097
------------ ----------- ---------
Total current liabilities 12,275 (1,292) 10,983
LONG-TERM LIABILITIES:
Notes payable 2,481 2,481
Other 2,086 2,086
------------ ----------- ---------
Total long-term liabilities 4,567 0 4,567
Total liabilities 16,842 (1,292) 15,550
STOCKHOLDER'S EQUITY:
Common stock 90 0 90
Common stock issuable 405 405
Additional contributed capital 16,765 0 16,765
Retained earnings (deficit) (4,985) (2)a (8,342)
(1,601)a
(82)a
(261)a
(5,100)a
420 a
464 a
369 a
339 a
1,000 b
500 b
1,500 b
(325)d
(300)e
(278)f
------------ ----------- ---------
12,275 (3,357) 8,918
Less treasury stock (3,413) (3,413)
Accumulated other comprehensive income (833) 278 f (555)
------------ ----------- ---------
Total stockholders' equity 8,029 (3,079) 4,950
Total liabilities and 24,871 (4,371) 20,500
stockholders' equity ============ =========== =========
</TABLE>
See the accompanying notes to unaudited pro forma financial statements.
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UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
For the Six Months Ended August 31, 2000
(in thousands, except per share information)
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
UNICOMP, INC. ADJUSTMENTS COMBINED
------------- ----------- ---------
<S> <C> <C> <C>
Revenue:
Equipment 6,056 6,056
Services 1,546 1,546
Software 2,013 (1,507)a 506
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Total revenue 9,615 (1,507) 8,108
Cost of sales
Equipment 4,219 4,219
Services 198 198
Software 809 (606)a 203
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Total cost of sales 5,226 (606) 4,620
Gross Profit 4,389 (901) 3,488
Selling, General, and Administrative 10,746 (2,336)a,d 8,410
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Operating Income (Loss) (6,357) 1,435 (4,922)
Other (Income) Expense:
Other, net (14) (14)
Interest, net 266 (6)a 260
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Other expense, net 252 (6) 246
Income (Loss) from continuing operations (6,609) 1,441 (5,168)
before provision for income taxes
Provision for income taxes 0 0
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Income (loss) from continuing operations (6,609) 1,441 (5,168)
============= =========== =========
Basic Earnings Per Common Share: (0.80) (0.63)
============= =========
Diluted Earnings Per Common Share: (0.80) (0.63)
============= =========
Weighted Average Shares 8,220 8,220
============= =========
Weighted Average Shares Assuming Dilution 8,220 8,220
============= =========
</TABLE>
See the accompanying notes to unaudited pro forma financial statements.
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UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
For the Twelve Months Ended February 29, 2000
(in thousands, except per share information)
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
UNICOMP, INC. ADJUSTMENTS COMBINED
------------- ----------- ---------
<S> <C> <C> <C>
Revenue:
Equipment 11,017 11,017
Services 6,032 (3,128)a 2,904
Software 7,062 (3,221)a 3,841
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Total revenue 24,111 (6,349) 17,762
Cost of sales
Equipment 7,329 7,329
Services 1,026 (215)a 811
Software 2,598 (1,786)a 812
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Total cost of sales 10,953 (2,001) 8,952
Gross Profit 13,158 (4,348) 8,810
Selling, General, and Administrative 13,988 (4,024)a,d 9,964
---------- --------- -------
Operating Income (Loss) (830) (324) (1,154)
Other (Income) Expense:
Other, net 148 (42)a 106
Interest, net 509 (16)a 493
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Other expense, net 657 (58) 599
Income (Loss) from continuing operations (1,487) (266) (1,753)
before provision for income taxes
Provision for income taxes 129 129
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Income (loss) from continuing operations (1,616) (266) (1,882)
Preferred Stock Dividends and Accretion 138 0 138
========== ======== ========
Income (Loss) Available to (1,754) (266) (2,020)
========== ======== ========
Common Shareholders
Basic Earnings Per Common Share: (0.23) (0.27)
========== ========
Diluted Earnings Per Common Share: (0.23) (0.27)
========== ========
Weighted Average Shares 7,557 7,557
========== ========
Weighted Average Shares Assuming Dilution 8,007 8,007
========== ========
</TABLE>
See the accompanying notes to unaudited pro forma financial statements.
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NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
(1) SALE OF UNIBOL LIMITED
Effective as of November 8, 2000 (the "Closing Date"), UniComp, Inc.
(the "Company"), through its wholly-owned subsidiary, UniComp Computing Group
Limited, sold all of the issued and outstanding shares of capital stock (the
"Shares") of the Company's Northern Ireland subsidiary, Unibol Limited ("Unibol
UK"), to California Software Corporation (the "Sale"). Unibol UK develops,
markets, and sells IBM Midrange migration software. The Sale was consummated in
accordance with the terms of that certain Stock Purchase Agreement between
Unibol Limited, ICS Computing Group Limited, UniComp, Inc., and California
Software Corporation ("CSC"), dated effective as of November 8, 2000, as amended
on November 10, 2000 (the "Sale Agreement").
In consideration of the Sale, CSC (i) paid $1,000,000 at closing in
cash to UniComp, Inc., (ii) an additional $500,000, in cash is payable to
UniComp, Inc. in equal monthly installments over four months with each
installment payment due on or before the first of each month beginning with the
second month after that in which the Closing Date falls (e.g., if the Closing
Date is November 8, 2000, then the first installment is due on or before
December 1, 2000), and (iii) $1,500,000 is payable to UniComp, Inc. in CSC
common stock on the six month anniversary of the Closing Date.
(2) PRO FORMA ADJUSTMENTS
As discussed in the introduction to this filing, the accompanying
unaudited pro forma condensed combined financial statements are based
on the historical presentation of the consolidated financial
statements of the Company. The unaudited pro forma balance sheet as of
August 31, 2000 gives effect to the Sale as if it occurred on August
31, 2000. The unaudited pro forma statements of operations for the year
ended February 29, 2000 and six months ended August 31, 2000 give
effect to the Sale as if it had occurred March 1, 1999, and reflect
only the results from continuing operations.
The unaudited pro forma financial information is presented for
informational purposes only and is not necessarily indicative of the
financial position and results of operations
<PAGE>
that would have been achieved had the Sale been completed as of the
dates indicated and is not necessarily indicative of the Company's
future financial position or results of operations.
The unaudited pro forma combined financial statements should be read
in conjunction with the historical consolidated financial statements
and notes thereto of the Company.
The pro forma adjustments are as follows:
(a) Removes Unibol Ltd's balances as of August 31, 2000 and results
for the periods ended February 29, 2000 and August 31, 2000 as
derived from the historical stand alone statements of
Unibol Limited.
(b) Recognize proceeds from the sale as noted above: $1,000,000 cash
at closing, $500,000 cash receivable over a four month period,
and $1,500,000 in CSC's common stock six months following the
Closing Date. The $500,000 receivable is classified as a current
asset in the pro forma balance sheet; however, if due to ongoing
litigation those payments are delayed, the Company will consider
a reclassification to non-current. There is no guarantee that the
shares of CSC common stock received on the six-month anniversary
of the Closing Date will be registered, marketable securities. As
such, the Company has recorded those shares receivable as a
non-current asset. The Company will continue to monitor CSC's
financial condition and the continuing litigation, and will
periodically re-evaluate the realizability of the cash and common
stock receivable.
(c) The Company records various intercompany transactions, including
funding of operations and allocations of Company wide costs, by
means of intercompany receivable and payable accounts. At the
time of disposition, Unibol Ltd. had a net payable position to
the Company and its other direct and indirect subsidiaries of
approximately $2.4 million. The Company has recorded a receivable
in that amount in the pro forma balance sheet to recognize the
fact that CSC acquired Unibol Ltd's payable in the transaction.
Due to the uncertainties caused by the continuing litigation, the
Company has reserved for the entire receivable. If the litigation
should be favorably settled within twelve months of the Closing
Date, the Company will reverse the reserve and adjust the gain or
loss on disposal accordingly.
(d) The Company recorded goodwill in its purchase of ICS Computing
Group, Ltd. and its subsidiaries, Unibol Ltd., ICS UniComp
("ICS"), and Aurora UniComp ("Aurora"). Both ICS and Aurora had
previously been disposed of, so the sale of Unibol Ltd.
effectively completes the disposal of the active operations of
ICS Computing Group. Consequently, amortization expense of
$148,000 and $70,000 has been reversed for the year ended 2/29/00
and six months ended 8/31/00, and the remaining goodwill balance
of $325,000 has been written off in connection with the sale in
the pro forma balance sheet.
(e) The Company has estimated fees payable as a result of the
transaction of $300,000.
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(f) Accumulated other comprehensive income on the Company's balance
sheet is entirely made up of translation gains and losses recorded
from the translation of foreign subsidiaries functional currencies
to the Company reporting currency of the U.S. dollar.
(3) LITIGATION WITH CALIFORNIA SOFTWARE CORPORATION
The Company is presently party to two lawsuits with CSC relating to the
sale of Unibol Limited. CSC claims to have purchased Unibol, Inc. in
its purchase of Unibol Ltd. and announced plans to operate under that
assumption. The Company disputes these claims and has filed a lawsuit
against CSC in connection with this dispute. CSC has filed a lawsuit
claiming fraudulent misrepresentation and other causes against several
parties including the Company and its CEO. The Company vigorously
denies these charges. Although there can be no assurances, management
strongly believes the Company will be successful in both of these
lawsuits. Management also believes the receivables from CSC for the
sale are fully enforceable. As discussed in pro forma adjustment (b)
above, the Company will continue to monitor the collectibility of those
receivables by reviewing CSC's financial condition and the status of
the lawsuits and will record any adjustments if necessary.
(c) Exhibits
<TABLE>
<CAPTION>
Exhibit No. Description
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<S> <C>
Exhibit 2.1 Stock Purchase Agreement dated as of November 9,
2000, by, between and among California Software
Corporation, a Nevada corporation, Unibol, Ltd, a
United Kingdom corporation, ICS Computing Group Ltd,
a United Kingdom corporation, and UniComp, Inc., a
Colorado corporation.
Exhibit 2.2 Addendum to Stock Purchase Agreement, dated as of
November 10, 2000
Exhibit 5.1 UniComp, Inc. press release, "UniComp Incorporated
Announces Letter of Intent With California Software
Corporation," dated November 8, 2000.
Exhibit 5.2 UniComp, Inc. press release, "UniComp Inc. Sells
Unibol Ltd. and Terminates Merger Talks With
California Software Corp.," dated December 4, 2000.
</TABLE>
