<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
-------------------
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) May 28, 1996
MARK SOLUTIONS, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-17118 112864481
(State or Other Jurisdiction Commission (IRS Employer
Of Incorporation) File Number) Identification Number)
Parkway Technical Center, 1515 Broad Street, Bloomfield, New Jersey 07003
(Address of Principal Executive Offices and Zip Code)
Registrant's telephone number, including area code (201) 893-0500
- --------------------------------------------------------------------------------
(Former Name and Address, if Changed Since Last Report)
<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
This amendment No. 2 to Current Report on Form 8-K amends Item 7
of the Form 8-K of Mark Solutions, Inc. ("Mark") dated May 28, 1996 to include
the following Financial Statements and Pro Forma Information which was excluded
from the original filing pursuant to Item 7(a)(4) of Form 8-K:
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired
1. Simis Medical Imaging Limited Audited Profit and Loss Account
and Balance Sheet for the fiscal years ended December 31, 1995
and 1994;
2. Simis Medical Imaging Limited Unaudited Profit and Loss Account
and Balance Sheet for the period ended March 31, 1996
(b) Pro Forma Financial Information
1. Pro Forma Combined Balance Sheet at March 31, 1996
2. Pro Forma Combined Statement of Operations for Nine Months
Ended March 31, 1996 and Fiscal Year Ended June 30, 1995
<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 hereunto duly authorized.
MARK SOLUTIONS, INC.
July 3, 1996 By: /s/ Carl Coppola
President and Chief Executive Officer
<PAGE>
SIMIS MEDICAL IMAGING LIMITED
FINANCIAL STATEMENT
31 DECEMBER 1995
BAKER TILLY
CHARTERED ACCOUNTANTS
OLD SARUM HOUSE
49 PRINCES STREET
YEOVIL
SOMERSET BA20 1 EG
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 1
DIRECTORS AND OFFICERS
- --------------------------------------------------------------------------------
DIRECTORS
C P R Cummins
I A Baverstock
SECRETARY
Seymour MacIntyre Limited
REGISTERED OFFICE
Abbots Fee
Greenhill
SHERBORNE
Dorset
BA20 1EG
AUDITORS
Baker Tilly
Chartered Accountants
Old Sarum House
49 Princes Street
YEOVIL
Somerset
BA20 1EG
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 2
DIRECTORS' REPORT
- --------------------------------------------------------------------------------
The directors submit their report and financial statements of Simis Medical
Imaging Limited for the year ended 31 December 1995.
PRINCIPAL ACTIVITIES
The principal activity of the company during the year was computer software
development and maintenance.
REVIEW OF THE BUSINESS
The business suffered a substantial loss in sales revenue during 1995, whilst
the operating expenses remained relatively constant. The loss of revenue was
attributable in the main to delays involved in changing the company's product
lines from UNIX workstations to customer preferred Windows NT based platforms.
Another major contributing factor was the lack of anticipated business from its
overseas distributors. During 1995 strenuous efforts were taken to develop
products on the newer platforms which at the end of the year was on target.
During the latter part of 1995 the company underwent a major restructuring
process in which several new employees were recruited to met the forecast
demands of 1996. The company takes the view that it will recover all losses and
return to profitability in 1996; this is backed by the high probability of the
company being awarded a major contract to provide its latest PACS software in
conjunction with an international manufacturer of computers; to supply
substantial enhancements to one of its major reference sites and income will
start to flow from its distributors.
RESULTS AND DIVIDENDS
The trading loss for the year after taxation was 124,674 Pounds. No dividend
has been declared.
CHARITABLE CONTRIBUTIONS
During the year the company made charitable contributions totaling 5 Pounds.
DIRECTORS
The following directors have held office since 1 January 1995:
C P R Cummins
I A Baverstock
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 3
DIRECTORS' REPORT
- --------------------------------------------------------------------------------
DIRECTORS' INTEREST IN SHARES AND DEBENTURES
Directors' interests in the shares of the company were as follows:
Ordinary Shares of 1 Pound each
31 December 1995 31 December 1994
---------------- ----------------
Mr. C. P. R.Cummins (Medical 450 450
Imaging Products & Services)
Mr. I. A. Baverstock 113 450
At 31 December 1994, 450 shares were held by Simis Limited, a company in which
Mr. Baverstock was a director. These shares were subsequently transferred and
Mr. Baverstock now holds 113 shares in his own name.
FIXED ASSETS
The significant changes in fixed assets during the year are explained in note 8
to the financial statements.
By order of the board
C.P.R. Cummins I. A. Baverstock
Director Director
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 4
DIRECTORS' RESPONSIBILITIES IN THE PREPARATION OF
FINANCIAL STATEMENTS
for the year ended 31 December 1995
- --------------------------------------------------------------------------------
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company and of the profit or loss of the company for the period. In preparing
those financial statements, the directors are required to:
a: select suitable accounting policies and then apply them consistently;
b: make judgements and estimates that are reasonable and prudent;
c: prepare the financial statements on the going concern basis unless it
is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose at any time the financial position of the company and to enable them
to ensure that the financial statements comply with the requirements of the
Companies Act of 1985. They are also responsible for safeguarding the assets
of the company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
<PAGE>
PAGE 5
AUDITORS' REPORT TO THE MEMBERS OF SIMIS MEDICAL IMAGING
LIMITED
- --------------------------------------------------------------------------------
We have audited the financial statements on pages 6 to 13.
Respective responsibilities of directors and auditors.
As described on page 4 the company's directors are responsible for the
preparation of financial statements. It is our responsibility to form an
independent opinion, based on our audit, on those statements and to report our
opinion to you.
Basis of opinion
We conducted our audit in accordance with Auditing Standards issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the financial statements.
It also includes an assessment of the significant estimates and judgements made
by the directors in the preparation of the financial statements, and of whether
the accounting policies are appropriate to the company's circumstances,
consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of the information in the financial statements.
Fundamental uncertainty
These accounts have been prepared under the going concern accounting policy as
stated on page 8. This is on the basis that the directors will continue to
obtain sufficient finance to meet the company's liabilities. Our opinion is
not qualified in this respect.
Opinion
In our opinion the financial statements give a true and fair view of the state
of the company's affairs at 31 December 1995 and of its loss for the year then
ended and have been properly prepared in accordance with the provision of the
Companies Act 1985.
BAKER TILLY
Registered Auditor
Chartered Accountants
Old Sarum House
49 Princes Street
YEOVIL
Somerset BA20 1ED
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 6
PROFIT AND LOSS ACCOUNT
For the year ended 31 December 1995
- --------------------------------------------------------------------------------
NOTES 1995 1994
TURNOVER 1 365,253 604,448
Cost of Sales 255,464 291,640
-------- -------
Gross Profit 109,789 312,808
Other operating expenses (net) 2 272,519 281,852
-------- -------
OPERATING (LOSS)/PROFIT (162,730) 30,956
Investment Income 3 2,213 3,074
-------- -------
(160,517) 34,030
Interest payable 3 (753) (92)
-------- -------
(LOSS)/PROFIT ON ORDINARY
ACTIVITIES BEFORE TAXATION 4 (161,270) 33,938
Taxation 6 36,596 (12,031)
-------- -------
RETAINED (LOSS)/PROFIT FOR
THE YEAR 13 Pounds (124,674) 21,907
No separate Statement of Total Recognised Gains and Losses has been presented
as all such gains and losses have been dealt with in the Profit and Loss
Account.
The loss for the year arises from the company's continuing operations.
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 7
BALANCE SHEET
31 December 1995
- -------------------------------------------------------------------------------
Notes 1995 1994
FIXED ASSETS
Tangible Assets 8 31,893 52,538
-------- -------
CURRENT ASSETS
Stocks 9 1,441 20,000
Debtors 10 121,790 119,952
Cash in bank and in hand 4,537 75,498
-------- -------
127,768 215,450
-------- -------
CREDITORS
Amounts falling due within one year 11 (148,448) (132,101)
-------- -------
NET CURRENT ASSETS/(LIABILITIES) (20,680) 83,349
-------- -------
TOTAL ASSETS LESS CURRENT
LIABILITIES Pounds 11,213 135,887
-------- -------
CAPITAL AND RESERVES
Called up share capital 12 900 900
Profit and loss account 13 10,313 134,987
-------- -------
Pounds 11,213 135,887
-------- -------
Approved by the board on 25th
April 1996
C.P.R. Cummins - Director
I. A. Baverstock - Director
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 8
ACCOUNTING POLICIES
Financial statements for the year ended 31 December 1995
- --------------------------------------------------------------------------------
BASIS OF ACCOUNTING
The financial statements have been prepared under the historical cost
convention in accordance with applicable accounting standards.
GOING CONCERN
The financial statements have been prepared on a going concern basis as the
directors have confirmed that they will continue to provide the company with
financial support and will provide any additional support which the company may
require in order to continue trading.
TANGIBLE FIXED ASSETS
Fixed assets are stated at historical cost.
Depreciation is provided on all tangible fixed assets other than freehold land
at rates calculated to write each asset down to its estimated residual value
evenly over its expected useful life, as follows:
Office equipment, fixtures and fittings - 25% per annum on cost
Computer hardware - 25% per annum on cost
Computer software - 50% per annum on cost
Motor vehicles - 25% per annum on cost
STOCKS AND WORK IN PROGRESS
Stocks and work in progress are valued at the lower of cost and net realizable
value. Cost of finished goods and work in progress includes overheads
appropriate to the stage of manufacture. Net realizable value is based upon
estimated selling price less further costs expected to be incurred to
completion and disposal. Provision is made for obsolete and slow-moving items.
Long term contracts are assessed on a contract by contract basis and reflected
in the profit and loss account by recording turnover and related costs as
contract activity progresses. Turnover is ascertained in a manner appropriate
to the stage of completion of the contract and credit taken for profit earned
to date when the outcome of the contract can be assessed with reasonable
certainty.
DEFERRED TAXATION
Provision is made for taxation deferred or accelerated by the effect of timing
differences, to the extent that it is probably that a liability will
crystallize, at the rate expected to be ruling at that date.
TURNOVER
Turnover represents the invoiced value, net of Value Added Tax, of goods and
services provided to customers.
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 9
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
1. TURNOVER AND (LOSS)/PROFIT ON ORDINARY
ACTIVITIES BEFORE TAXATION
The company's turnover and profit before taxation
were all derived from its principal activity. Sales were
made in the following geographical markets:
United Kingdom and Europe 365,253 604,448
------- -------
Pounds 365,253 604,448
------- -------
2. OTHER OPERATING EXPENSES (NET)
Administration expenses 273,234 281,852
Other operating income (715)
------- -------
Pounds 272,519 281,852
------- -------
3. INVESTMENT INCOME
Other interest receivable Pounds 2,213 3,074
------- -------
INTEREST PAYABLE
On VAT assessment 371 -
On Corporation tax assessment 382 -
On PAYE assessment - 92
------- -------
Pounds 753 92
------- -------
4. (LOSS)/PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION
(Loss)/Profit on ordinary activities before
taxation is stated after charging:
Depreciation and amounts written off
tangible fixed assets:
Charge for the period
owned assets Pounds 41,108 35,824
Loss on disposal - 2,820
Auditors' remuneration 1,200 1,200
------- -------
</TABLE>
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 10
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
5. EMPLOYEES
The average weekly number of persons No. No.
(including directors) employed by the
company during the year was: 8 9
Staff costs for the above persons:
Wages and salaries 140,901 153,404
Social security costs 13,992 14,813
------- -------
Pounds 154,893 168,217
------- -------
</TABLE>
The directors received remuneration from the company during the
year of Pounds 2,750. (1994 Pounds Nil). See also note 16.
6. TAXATION
<TABLE>
<S> <C> <C>
Based on the profit for the year:
UK Corporation tax at 25% (1994 - 25%)
Pounds (35,022) 11,889
(Over)/under provided in earlier years (1,574) 142
------- -------
Pounds (36,596) 12,031
------- -------
7. DIVIDENDS
Final Paid Pounds - -
------- -------
</TABLE>
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 11
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 1995
- --------------------------------------------------------------------------------
8. TANGIBLE FIXED ASSETS
<TABLE>
<CAPTION>
OFFICE
EQUIPMENT
MOTOR COMPUTER COMPUTER FIXTURES &
VEHICLES HARDWARE SOFTWARE FITTINGS TOTAL
<S> <C> <C> <C> <C> <C>
Cost:
1 January 1995 ----------- 101,283 18,298 25,650 145,231
Additions ----------- 13,052 7,411 -------- 20,463
----------- ------- ------ -------- -------
31 December 1995 ----------- 114,335 25,709 25,650 165,694
----------- ------- ------ -------- -------
Depreciation:
1 January 1995 ----------- 59,635 14,913 18,145 92,693
Charge for year ----------- 27,664 7,091 6,353 41,108
----------- ------- ------ -------- -------
31 December 1995 ----------- 87,299 22,004 24,498 133,801
----------- ------- ------ -------- -------
Net Book Value:
31 December 1995 ----------- 27,036 3,705 1,152 31,893
----------- ------- ------ -------- -------
1 January 1995 ----------- 41,648 3,385 7,505 52,538
----------- ------- ------ -------- -------
</TABLE>
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 12
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 1995
- -------------------------------------------------------------------------------
1995 1994
9. STOCKS
Raw materials and consumables 1,441 ------
Work in progress ------ 20,000
--------- ---------
Pounds 1,441 20,000
--------- ---------
10. DEBTORS
Due within one year:
Trade debtors 69,736 106,984
Other debtors 38,565 4,046
Prepayments and accrued income 13,489 8,922
--------- ---------
Pounds 121,790 119,952
--------- ---------
11. CREDITORS
Amounts falling due within one year:
Bank loans and overdrafts 25,498 ---------
Trade creditors 41,107 29,426
Corporation tax --------- 11,889
Other taxation and social security costs 5,015 4,391
Balances due to related company 14,776 9,715
Balances due to related party 28,875 20,897
Accruals and deferred income 33,177 55,783
--------- ---------
Pounds 148,448 132,101
--------- ---------
Trade creditors are generally subject to retention of title clauses. The
company's bankers hold a debenture over all assets.
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 13
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
12. SHARE CAPITAL
Authorized:
900 ordinary shares of Pounds 1 each 900 900
--------- --------
Allotted, issued and fully paid:
900 ordinary shares of Pounds 1 each 900 900
--------- --------
13. PROFIT AND LOSS ACCOUNT
1 January 1995 134,987 113,080
(Loss)/Profit for the year (124,674) 21,907
--------- --------
31 December 1995 Pounds 10,313 134,987
14. RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS
(Loss)/Profit for the financial year (124,674) 21,907
Dividends - -
--------- --------
Net reduction/addition to shareholders' funds (124,674) 21,907
Opening shareholders' funds 134,987 113,080
--------- --------
Closing shareholders' funds 10,313 134,987
--------- --------
15. PENSION COMMITMENTS
The company operated a defined contribution pension scheme whose assets
are held separately from those of the company in an independently
administered fund. The pension cost charge represents contributions
payable by the company and amount to Pounds Nil in 1995 (1994 Pounds
1,324).
16. DIRECTORS' INTERESTS IN CONTRACTS
The company incurred management charges of Pounds 44,320 in the year from
SIMIS Limited, I A Baverstock is a director of both companies.
The company incurred consultancy charges and expenses of Pounds 56,796 in
the year from Medical Imaging Products and Services and Cummins
Consultancy and Services Limited. C P R Cummins is a director of both
Simis Medical Imaging Limited and Cummins Consultancy and Services Limited
and a partner in Medical Imaging Products and Services which owns 50% of
the share capital.
<PAGE>
SIMIS MEDICAL IMAGING LIMITED PAGE 14
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 1995
- --------------------------------------------------------------------------------
17. CONTINGENT LIABILITIES
The company has made sales of equipment during the year which are not
covered by maintenance contracts. Should they require repair or
replacement this cost would be borne by the company. The approximate cost
would be Pounds 1,500.
18. PURCHASE COMMITMENTS
The company sponsors a Ph.D. student at Imperial College, London. There
are outstanding future commitments in respect of this sponsorship of
approximately Pounds 4,250 for the year ending 31 December 1996. In
addition should the student remain a further year there will be a further
liability in the year ending 31 December 1998.
<PAGE>
SIMIS MEDICAL IMAGING LIMITED SCHEDULE 1
DETAILED TRADING PROFIT AND LOSS ACCOUNT
For the year ended 31 December 1995
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C> <C> <C>
SALES
Imtran sale 201,494 462,597
Optical disc sales 14,292 29,411
Consultancy 27,695 4,218
Customer maintenance 108,552 101,811
CPRC personal 11,874 -
Other sales 1,346 -
Other work done - 6,340
Distribution and carriage - 71
---------- ---------
365,253 604,448
COST OF SALES
Opening stock 20,000 1,273
Imtran costs 70,841 104,571
Optical disc costs 9,852 27,240
Other cost of sales 945 2,838
Customer maintenance (80) 15,939
Wages and salaries 155,347 159,779
---------- ---------
256,905 311,640
Closing stock 1,441 20,000
---------- ---------
255,464 291,640
---------- ---------
GROSS PROFIT 30.1% 109,789 51.8% 312,808
SUNDRY TRADING INCOME
Other operating income 715 -
Deposit account interest 2,213 3,074
2,928 3,074
---------- ---------
112,717 315,882
OVERHEADS PER SCHEDULE
Labor Costs 77,845 86,563
Establishment 41,547 34,126
Administrative and general 104,739 117,158
Selling and distribution 5,952 4,185
Financial 2,043 1,176
Depreciation 41,108 38,644
---------- ---------
273,234 281,852
---------- ---------
(160,517) 34,030
INTEREST PAYABLE 753 92
---------- ---------
(LOSS)/PROFIT FOR
THE YEAR Pounds (161,270) Pounds 33,938
---------- ---------
</TABLE>
<PAGE>
SIMIS MEDICAL IMAGING LIMITED SCHEDULE 2
SCHEDULE OF OVERHEADS
For the year ended 31 December 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
LABOR COSTS
Wages and national insurance 77,446 86,563
Training 339 -
---------- ---------
77,845 86,563
ESTABLISHMENT
Rent 20,827 19,208
Rates and water 7,198 6,475
Repairs to property 165 -
Lighting and heating 1,705 1,462
Service charge 11,652 6,981
---------- ---------
41,547 34,126
ADMINISTRATIVE AND GENERAL
Repairs to plant 608 (1,841)
Motor vehicle expenses - 13,098
Insurance (4,020) 9,715
Printing,stationery and postage 8,128 10,314
Telephone 12,450 16,299
Traveling expenses 29,661 30,604
Accountancy charges 2,430 4,275
Consultancy fees 25,966 26,042
Legal and professional fees 25,989 3,420
Subscriptions and donations 915 2,181
Cleaning 1,837 1,811
General expenses 775 1,240
---------- ---------
104,739 117,158
SELLING AND DISTRIBUTION
Sales promotion 2,177 (1,585)
Advertising 2,622 2,707
Entertaining 1,098 1,336
Bad debts 55 1,727
---------- ---------
5,952 4,185
FINANCIAL
Bank charges 2,043 1,176
---------- ---------
2,043 1,176
DEPRECIATION
Charged for the year 41,108 35,824
Loss on sale of fixed assets - 2,820
---------- ---------
41,108 38,644
---------- ---------
TOTAL OVERHEAD
EXPENSES Pounds 273,234 Pounds 281,852
</TABLE>
<PAGE>
SIMIS MEDICAL IMAGING LIMITED
FINANCIAL STATEMENT
31 MARCH 1996
<PAGE>
SIMIS MEDICAL IMAGING LIMITED
BALANCE SHEET
31 March 1996
31 March 1996
--------------------------
FIXED ASSETS
Tangible Assets 27,789
CURRENT ASSETS
Stocks 1,441
Debtors 140,465
Corporation Tax 23,132
Prepayments 7,746
Cash in bank and in hand 20,437
--------
POUNDS 193,221
--------
CREDITORS
Amounts falling due within one year POUNDS 174,815
--------
NET CURRENT ASSETS/
(LIABILITIES) POUNDS 18,406
--------
TOTAL ASSETS LESS CURRENT
LIABILITIES POUNDS 46,195
--------
CAPITAL AND RESERVES
Called up share capital 900
Profit and loss account 45,295
--------
POUNDS 46,195
--------
<PAGE>
SIMIS MEDICAL IMAGING LIMITED
PROFIT AND LOSS ACCOUNT
For the Three Months Ended March 31, 1996
<TABLE>
<CAPTION>
Three Months Ended 31, March
-----------------------------------------------
1996 1995
------- --------
<S> <C> <C> <C>
TURNOVER
Sales POUNDS 173,369 174,710
------- --------
COSTS OF SALES
Cost of Sales 20,151 122,122
------- --------
GROSS PROFIT POUNDS 153,218 52,588
OTHER OPERATING EXPENSES
Direct Expenses 6,160 ---
Overheads 112,076 68,308
------- --------
OPERATING (LOSS)/PROFIT POUNDS 34,982 (15,720)
------- --------
OTHER INCOME (EXPENSES) --- 365
------- --------
(LOSS)/PROFIT ON ORDINARY
ACTIVITIES 34,982 (15,355)
------- --------
TAXATION 8,745 ---
------- --------
(LOSS)/PROFIT POUNDS 26,237 15,355
------- --------
</TABLE>
<PAGE>
NOTES TO MARCH 31, 1996 FINANCIAL STATEMENT
Note 1- Financial Statement Presentation
In the opinion of SMI management at March 31, 1996, the accompanying
financial statements give a true and fair view of the state of affairs of SMI
and of the profit or loss of SMI for the period.
The accounting policies followed by SMI are set forth in the Notes to
Financial Statements included in this Report for the fiscal years ended
December 31, 1994 and 1995, and such notes are incorporated herein by
reference.
The results of operations for the interim period presented is not
necessarily indicative of the results to be expected for the full fiscal year.
<PAGE>
PRO FORMA COMBINED
FINANCIAL STATEMENTS
<PAGE>
Mark Solutions, Inc. and Subsidiaries
Pro Forma Combined Financial Statements
The Registrant's March 31, 1996 unaudited pro forma combined financial
statements give effect to the purchase of Simis Medical Imaging, Limited as set
forth in Notes (1) and (2) to these financial statements, as if the transaction
had occurred for balance sheet purposes on March 31, 1996 and, for purposes of
the statement of operations, on July 1, 1995. These unaudited pro forma
combined financial statements should be read in conjunction with the
Registrant's consolidated financial statements and notes thereto. The pro
forma information is not necessarily indicative of the results that would have
been reported had such events actually occurred on the dates specified, nor is
it indicative of the Registrant's future results.
Pro Forma Combined Balance Sheet
March 31, 1996
<TABLE>
<CAPTION>
Historical
------------------------------------ Pro Forma
Mark Solutions, Inc. Simis Medical --------------------------
and Subsidiaries Imaging Limited Adjustments Combined
------------------- --------------- ----------- ---------
<S> <C> <C> <C> <C>
Assets
Cash and restricted cash $ 316,081 $ 31,165 - - - $ 347,246
Accounts receivable, net 923,187 214,195 - - - 1,137,382
Inventories 285,014 2,197 - - - 287,211
Other 352,037 47,086 - - - 399,123
------------ ------------ ------------- ------------
Total Current Assets 1,876,319 294,643 - - - 2,170,962
------------ ------------ ------------- ------------
Property and Equipment, Net 256,887 42,375 - - - 299,262
------------ ------------ ------------- ------------
Other Assets:
Costs in excess of net assets of
businesses acquired, net 907,088 - - -(1) 1,179,558 2,086,646
Other 105,134 - - - - - - 105,134
------------ ------------ ------------- ------------
Total Other Assets 1,012,222 - - - 1,179,558 2,191,780
------------ ------------ ------------- ------------
Total Assets $ 3,145,428 $ 337,018 $ 1,179,558 $ 4,662,004
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $ 1,018,049 $ 158,820 - - - $ 1,176,869
Current liabilities 61,339 107,756 - - - 169,095
------------ ------------ ------------- ------------
Total Current Liabilities 1,079,388 266,576 - - - 1,345,964
------------ ------------ ------------- ------------
Other Liabilities:
Long-term debt,
excluding current maturities 54,802 - - - - - - 54,802
------------ ------------ ------------- ------------
Stockholders' Equity:
Common stock 130,853 1,372(1) (1,372) 132,492
1,639
Additional paid in capital 22,393,191 - - -(1) 1,248,361 23,641,552
Retained earnings (deficit) (20,512,806) 69,070(1) (69,070) (20,512,806)
------------ ------------ ------------- ------------
Total Stockholders' Equity 2,011,238 70,442 1,179,558 3,261,238
------------ ------------ ------------- ------------
Total Liabilities and
Stockholders' Equity $ 3,145,428 $ 337,018 $ 1,179,558 $ 4,662,004
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
<PAGE>
Mark Solutions, Inc. and Subsidiaries
Pro Forma Combined Statement of Operations
For the Nine Months Ended March 31, 1996
</TABLE>
<TABLE>
<CAPTION>
Historical
------------------------------------ Pro Forma
Mark Solutions, Inc. Simis Medical --------------------------
and Subsidiaries Imaging Limited Adjustments Combined
------------------- --------------- ----------- ---------
<S> <C> <C> <C> <C>
Revenues $ 3,206,371 $ 313,349 $ - - - $ 3,519,720
------------ ------------ ------------- ------------
Cost and Expenses:
Cost of sales 3,656,949 61,735 - - - 3,718,684
Selling, general, and
administrative expenses 2,807,949 396,809(2) 176,934 3,381,692
------------ ------------ ------------- ------------
Total Costs and Expenses 6,464,898 458,544 176,934 7,100,376
------------ ------------ ------------- ------------
Operating (Loss) (3,258,527) (145,195) (176,934) (3,580,656)
Other Income (Expenses) (48,178) 1,138 - - - (47,040)
------------ ------------ ------------- ------------
(Loss) From Continuing Operations (3,306,705) (144,057) (176,934) (3,627,696)
Income Taxes (Benefit) - - - (57,060) - - - (57,060)
------------ ------------ ------------- ------------
(Loss) Before Discontinued Operations (3,306,705) (86,997) (176,934) (3,570,636)
(Loss) From Discontinued Operations (104,503) - - - - - - (104,503)
------------ ------------ ------------- ------------
Net (Loss) $ (3,411,208) $ (86,997) $ (176,934) $ (3,675,139)
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
(Loss) per Share ($0.27) $ - - - $ - - - ($0.29)
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
Weighted Average Number of Shares
Outstanding 12,500,250 - - - - - - 12,664,184
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
</TABLE>
Notes:
(1) The unaudited pro forma combined balance sheet as of March 31, 1996
gives the effect to the purchase of Simis Medical Imaging, Limited,
which was acquired on May 28, 1996 as though such acquisition had taken
place on March 31, 1996. The unaudited combined statement of
operations gives effect to the purchase of Simis Medical Imaging,
Limited as though such acquisition had taken place on July 1, 1995.
(2) Reflects the amortization of Costs in excess of net assets of business
acquired with a five year amortization period.
<PAGE>
Mark Solutions, Inc. and Subsidiaries
Pro Forma Combined Financial Statements
The Registrant's June 30, 1995 unaudited pro forma combined financial statement
gives effect to the purchase of Simis Medical Imaging, Limited as set forth in
Notes (1) and (2) to these financial statements, as if the transaction had
occurred for statement of income purposes on July 1, 1994. This unaudited pro
forma combined statement of operations should be read in conjunction with the
Registrant's consolidated financial statements and notes thereto. The pro
forma information is not necessarily indicative of the results that would have
been reported had such events actually occurred on the dates specified, nor is
it indicative of the Registrant's future results.
Pro Forma Combined Statement of Operations
For the Year Ended June 30, 1995
<TABLE>
<CAPTION>
Historical
------------------------------------ Pro Forma
Mark Solutions, Inc. Simis Medical --------------------------
and Subsidiaries Imaging Limited Adjustments Combined
------------------- --------------- ----------- ---------
<S> <C> <C> <C> <C>
Revenues $ 5,997,165 $ 934,202 $ - - - $ 6,931,367
------------ ------------ ------------- ------------
Cost and Expenses:
Cost of sales 5,851,503 564,529 - - - 6,416,032
Selling, general, and
administrative expenses 3,872,392 432,187(2) 235,912 4,540,491
Adjustment of net assets of
business acquired 1,100,000 - - - - - - 1,100,000
------------ ------------ ------------- ------------
Total Costs and Expenses 10,823,895 996,716 235,912 12,056,523
------------ ------------ ------------- ------------
Operating (Loss) (4,826,730) (62,514) (235,912) (5,125,156)
Other Income (Expenses) (85,905) 3,463 - - - (82,442)
------------ ------------ ------------- ------------
(Loss) From Continuing Operations (4,912,635) (59,051) (235,912) (5,207,598)
Income Taxes (Benefit) - - - (19,152) - - - (19,152)
------------ ------------ ------------- ------------
(Loss) Before Discontinued Operations (4,912,635) (39,899) (235,912) (5,188,446)
(Loss) From Discontinued Operations (277,438) - - - - - - (277,438)
------------ ------------ ------------- ------------
Net (Loss) $ (5,190,073) $ (39,899) $ (235,912) $ (5,465,884)
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
(Loss) per Share ($0.48) $ - - - $ - - - ($0.50)
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
Weighted Average Number of Shares
Outstanding 10,726,204 - - - - - - 10,890,138
------------ ------------ ------------- ------------
------------ ------------ ------------- ------------
</TABLE>
Notes:
(1) The unaudited pro forma combined statement of operations as of June 30,
1995 gives effect to the purchase of Simis Medical Imaging, Limited,
which was acquired on May 28, 1996 as though such acquisition had taken
place on July 1, 1994.
(2) Reflects the amortization of Costs in excess of net assets of business
acquired with a five year amortization period.
