ASA INTERNATIONAL LTD.
10 Speen Street
Framingham, Massachusetts 01701
(508) 626-2727
October 20, 2000
Securities and Exchange Commission
450 5th Street, N.W.
Judiciary Plaza
Washington, D.C. 20549
Attention: Filing Desk
-----------------------
RE: ASA INTERNATIONAL LTD.
SEC FILE NO. 0-14741
Pursuant to regulations of the Securities and Exchange Commission, submitted
herewith for filing on behalf of ASA International Ltd. (the "Company") is the
Company's Form 8-K dated October 20, 2000.
This filing is being effected by direct transmission to the Commission's
Operational EDGAR System.
Very truly yours,
ASA INTERNATIONAL LTD.
/s/ Terrence C. McCarthy
Terrence C. McCarthy
Vice President and Treasurer
TCM/mb
<PAGE>
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: October 20, 2000
ASA International Ltd.
----------------------
(Exact name of Registrant as specified in its Charter)
Delaware O-14741 02-0398205
------------- ------------- ----------------
State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification Number)
10 Speen Street, Framingham, MA 01701
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: 508-626-2727
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<PAGE>
TABLE OF CONTENTS
FORM 8-K
October 20, 2000
Item Page
---- ----
Item 2. Disposition of Assets 1
Item 7. Financial Statements and Exhibits 2
Signature 4
Financial Statements F-1
3
<PAGE>
Item 2. Disposition of Assets
------------------------------
ASA International Ltd., a Delaware corporation (the "Registrant"),
completed the sale of its SmartTime business to InterPro Business Solutions,
Inc. (formerly InterPro Expense Systems, Inc.), a Delaware corporation
("InterPro"). Pursuant to an Option to Purchase Agreement dated August 2, 1999
by and between the Registrant, InterPro, and ASA InterPro SmartTime LLC, a
Delaware limited liability company, InterPro exercised its option to purchase
the SmartTime business from the LLC for the aggregate purchase price of
$7,020,000 less the option fees paid on August 2, 1999 of $1,660,000 and
$540,000 paid on August 1, 2000. The terms and conditions of the acquisition
under the option are set forth in the Asset Purchase Agreement dated as of
August 2, 1999 (the "Purchase Agreement"). As more fully set forth in the
Purchase Agreement and Exhibits thereto, on August 2, 1999, InterPro had loaned
to the Registrant $3,200,000 pursuant to a promissory note due on or before
August 31, 2000 (the "ASA Note"). Interest of $160,000 on the ASA Note was
prepaid to August 1, 2000. InterPro completed the transaction by paying the
remaining $4,820,000 of the purchase price by (a) delivering the ASA Note
(valued at $3,213,151 as a result of interest accrued from August 1 through
August 31, 2000), and (b) paying the remainder of $1,606,849 in cash.
Item 7. Financial Statements and Exhibits.
(a) Not applicable.
(b) Pro forma financial information.
The following unaudited pro forma condensed consolidated financial
statements are filed with this report:
Pro forma Condensed Consolidated Balance Sheet
at June 30, 2000 F-1 to F-2
Pro forma Condensed Consolidated Statements of Operations.
Year Ended December 31, 1999 F-3
Six Months Ended June 30, 2000 F-4
The pro forma condensed consolidated balance sheet of the Registrant as of
June 30, 2000, reflects the financial position of the Registrant after giving
effect to the disposition of the assets and assumption of the liabilities
discussed in Item 2 and assumes the disposition took place on June 30, 2000. The
pro forma condensed consolidated statements of operations for the fiscal year
ended December 31, 1999, and the six months ended June 30, 2000, assume that the
disposition occurred on January 1, 1999, and are based on the operations of the
Registrant for the year ended December 31, 1999 and the six months ended June
30, 2000, respectively.
The unaudited pro forma condensed consolidated financial statements have
been prepared by the Registrant based upon assumptions deemed proper by it. The
unaudited pro forma condensed consolidated financial statements are not
necessarily indicative of the future financial position or results of operations
or actual results that would have occurred had the transaction been in effect as
of the dates presented.
4
<PAGE>
The unaudited pro forma condensed consolidated financial statements should
be read in conjunction with the Registrant's historical financial statements and
related notes.
(c) Exhibits.
Exhibit
No. Title
------- -----
10.1* Option to Purchase Agreement dated as of August 2, 1999.
10.2* Asset Purchase Agreement dated as of August 2, 1999.
10.3* Operating Agreement dated as of August 2, 1999.
10.4* Sublease and Consent Agreement dated as of August 2, 1999.
10.5* Revolving Promissory Note dated as of August 2, 1999.
10.6* Customer Intangibles License Agreement dated as of August 2, 1999.
10.7* Intellectual Property License Agreement dated as of August 2, 1999.
10.8* Promissory Note dated as of August 2, 1999.
* Previously filed on August 13, 1999.
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<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ASA International Ltd.
By: /s/ Terrence C. McCarthy
-----------------------------
Terrence C. McCarthy
Vice President and Treasurer
Date: October 20, 2000
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<PAGE>
PRO FORMA FINANCIAL INFORMATION
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
<TABLE>
<CAPTION>
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AT JUNE 30, 2000
(Unaudited)
---Pro Forma Adjustments---
Historical SmartTime (a) Other Pro Forma
---------- ------------- --------------- ------------
ASSETS
<S> <C> <C> <C> <C>
CURRENT ASSETS:
Cash and Cash equivalents $ 1,976,377 $ -- $ (573,151)(b) $ 1,403,226
Marketable securities 899,363 -- -- 899,363
Receivables - net 4,869,563 -- -- 4,869,563
Other current assets 2,680,105 -- 2,110,249 (b) 4,790,354
Net assets of SmartTime 488,383 488,383 -- --
------------ ------------ ------------ ------------
TOTAL CURRENT ASSETS 10,913,791 488,383 1,537,098 11,962,506
PROPERTY AND
EQUIPMENT - NET 5,026,917 -- -- 5,026,917
SOFTWARE - NET 5,728,397 -- -- 5,728,397
COST EXCEEDING NET
ASSETS ACQUIRED - NET 9,023 -- -- 9,023
NOTES RECEIVABLE 1,700,000 -- -- 1,700,000
OTHER ASSETS 1,298,441 -- -- 1,298,441
------------ ------------ ------------ ------------
$ 24,676,569 $ 488,383 $ 1,537,098 $ 25,725,284
============ ============ ============ ============
</TABLE>
(a) To eliminate the net assets of ASA's SmartTime business included in ASA's
balance sheet as of June 30, 2000.
(b) To record the receipt of the second option fee ($540,000), the deposit of
funds with an intermediary ($2,720,000), and to reflect the elimination of
prepaid transaction costs related to the sale ($609,751).
(c) To record the repayment of the Note ($3,200,000), the elimination of
deferred option and license fees ($2,460,000) and the accrual of additional
expenses related to the sale and estimated taxes on the gain from the sale.
7
<PAGE>
PRO FORMA FINANCIAL INFORMATION
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
<TABLE>
<CAPTION>
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AT JUNE 30, 2000
(Unaudited)
---Pro Forma Adjustments---
Historical SmartTime (a) Other Pro Forma
------------ ------------- ------------- ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C> <C> <C>
CURRENT LIABILITIES:
Notes payable - bank $ 319,527 $ -- $ -- $ 319,527
Note payable - other 3,200,000 -- 3,200,000 (c) --
Deferred option and license fees 2,460,000 -- 2,460,000 (c) --
Accounts payable 793,211 -- -- 793,211
Accrued expenses 2,191,818 -- (25,000)(c) 2,216,818
Deferred revenue 1,365,265 -- -- 1,365,265
Other current liabilities 686,635 -- -- 686,635
------------ ------------ ------------- ------------
TOTAL CURRENT 11,016,456 -- 5,635,000 5,381,456
LIABILITIES
DEFERRED TAXES 497,000 -- (2,673,000)(c) 3,170,000
LONG-TERM DEBT 3,873,836 -- -- 3,873,836
LONG-TERM LIABILITES 240,631 -- -- 240,631
COMMITMENTS -- -- -- --
SHAREHOLDERS' EQUITY: 9,048,646 488,383 (4,499,098) 13,059,361
------------ ------------ ------------ ------------
$ 24,676,569 $ 488,383 $ (1,537,098) $ 25,725,284
============ ============ ============ ============
</TABLE>
(a) To eliminate the net assets of ASA's SmartTime business included in ASA's
balance sheet as of June 30, 2000.
(b) To record the receipt of the second option fee ($540,000), the deposit of
funds with an intermediary ($2,720,000), and to reflect the elimination of
prepaid transaction costs related to the sale ($609,751).
(c) To record the repayment of the Note ($3,200,000), the elimination of
deferred option and license fees ($2,460,000) and the accrual of additional
expenses related to the sale and estimated taxes on the gain from the sale.
8
<PAGE>
PRO FORMA FINANCIAL INFORMATION
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
<TABLE>
<CAPTION>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
(Unaudited)
-Pro Forma Adjustments-
Historical SmartTime (a) Other Pro Forma
------------ ------------- -------- ------------
<S> <C> <C> <C> <C>
REVENUES
Services $ 15,062,870 $ -- $ -- $ 15,062,870
Product licenses 6,506,376 -- -- 6,506,376
Computer and add-on hardware 4,053,289 -- -- 4,053,289
------------ ----------- ------- ------------
NET REVENUE 25,622,535 -- -- 25,622,535
COST OF REVENUE
Services 9,485,924 -- -- 9,485,924
Product licenses 4,456,953 -- -- 4,456,953
Computer and add-on hardware 3,219,535 -- -- 3,219,535
------------ ----------- ------- ------------
TOTAL COST OF REVENUE 17,162,412 -- -- 17,162,412
EXPENSES
Marketing and sales 4,356,610 -- -- 4,356,610
General and administrative 3,570,022 -- -- 3,570,022
Amortization of goodwill 42,234 -- -- 42,234
------------- ----------- -------- ------------
TOTAL EXPENSES 7,968,866 -- -- 7,968,866
EARNINGS (LOSS) FROM OPERATIONS 491,257 -- -- 491,257
INTEREST EXPENSE (386,396) -- -- (386,396)
INTEREST INCOME 508,793 -- -- 508,793
EQUITY IN LOSS FROM AFFILIATE (165,972) 165,972 -- --
GAIN ON SALE OF COMMERCIALWARE 3,824,420 -- -- 3,824,420
OTHER INCOME (EXPENSE)-NET (183,237) -- -- (183,237)
------------ ----------- ------- ------------
EARNINGS BEFORE TAXES ON INCOME 4,088,865 165,972 -- 4,254,837
INCOME TAXES (BENEFIT) 1,922,000 78,016 -- 2,000,016
------------ ----------- ------- ------------
NET EARNINGS (LOSS) $ 2,166,865 $ 87,956 $ -- $ 2,254,821
============ ============ ======= ============
NET INCOME PER SHARE:
BASIC $ 0.67 $ -- $ -- $ 0.70
============ ============ ======= ============
DILUTED $ 0.63 $ -- $ -- $ 0.66
============ ============ ======= ============
WEIGHTED AVERAGE SHARES
BASIC 3,218,291 -- -- 3,218,291
============ ============ ======= ============
DILUTED 3,429,844 -- -- 3,429,844
============ ============ ======= ============
</TABLE>
(a) To eliminate the profit and loss of SmartTime for the entire period
9
<PAGE>
PRO FORMA FINANCIAL INFORMATION
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
<TABLE>
<CAPTION>
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2000
(Unaudited)
-Pro Forma Adjustments-
Historical SmartTime (a) Other Pro Forma
------------ ------------- --------- ------------
<S> <C> <C> <C> <C>
REVENUE
Services $ 6,875,889 $ -- $ -- $ 6,875,889
Product licenses 2,802,865 -- -- 2,802,865
Computer and add-on hardware 670,365 -- -- 670,365
------------ ----------- ------- ------------
NET REVENUE 10,349,119 -- -- 10,349,119
COST OF REVENUE
Services 4,100,765 -- -- 4,100,765
Product licenses 2,494,636 -- -- 2,494,636
Computer and add-on hardware 536,846 -- -- 536,846
------------ ----------- ------- ------------
TOTAL COST OF REVENUE 7,132,247 -- -- 7,132,247
EXPENSES
Marketing and sales 2,527,348 -- -- 2,527,348
General and administrative 1,807,684 -- -- 1,807,684
Amortization of goodwill 9,023 -- -- 9,023
------------ ----------- ------- ------------
TOTAL EXPENSES 4,344,055 -- -- 4,344,055
EARNINGS (LOSS) FROM OPERATIONS (1,127,183) -- -- (1,127,183)
------------ ----------- ------- ------------
INTEREST EXPENSE (214,755) -- -- (214,755)
INTEREST INCOME 203,582 -- -- 203,582
EQUITY IN LOSS FROM AFFILIATE (922,858) 922,858 -- --
OTHER INCOME - NET 320,790 -- -- 320,790
------------ ------------ ------- ------------
EARNINGS BEFORE TAXES ON INCOME (1,740,424) 922,858 -- (817,566)
INCOME TAXES (BENEFIT) (649,000) 344,132 -- (304,868)
------------ ------------ ------- ------------
NET EARNINGS (LOSS) $ (1,091,424) $ 578,726 $ -- $ (512,698)
============ ============ ======= ============
NET INCOME PER SHARE
BASIC $ (0.34) $ -- $ -- $ (0.16)
============ ============ ======= ============
DILUTED $ (0.34) $ -- $ -- $ (0.16)
============ ============ ======= ============
WEIGHTED AVERAGE SHARES
BASIC 3,186,697 -- -- 3,186,697
============ ============ ======= ============
DILUTED 3,186,697 -- -- 3,186,697
============ ============ ======= ============
</TABLE>
(a) To eliminte the profit and loss of SmartTime for the entire period.
10
