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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K/A
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported):
SEPTEMBER 5, 1996
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CHARTER COMMUNICATIONS INTERNATIONAL, INC.
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NEVADA
(State or other jurisdiction of incorporation or organization)
33-25129-LA 84-1097751
(Commission File No.) (I.R.S. Employer
Identification No.)
17100 EL CAMINO REAL
SUITE 100 77058
HOUSTON, TEXAS (Zip Code)
(Address of principal executive offices)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (713) 486-8337
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(Former address, if changed since last report)
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INFORMATION INCLUDED IN THIS REPORT
This form 8-K/A amends the Form 8-K filed with the Commission on
September 20, 1996, relating to the acquisition by Charter Communications
International, Inc., a Nevada corporation (the "Company"), of Overlook
Communications International Corporation, a North Carolina corporation
("OCI") to provide elimination of the financial information required
pursuant to Item 7 thereof which was not filed with the Form 8-K
on September 20, 1996.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial statement of business acquired:
The audited financial statements of OCI for the year ended December 31,
1995, were filed with the Form 8-K on September 20, 1996; the unaudited
financial statements of OCI for the three months and six month period ended
June 30, 1996, are file herewith.
2
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OVERLOOK COMMUNICATIONS INTERNATIONAL CORPORATION
BALANCE SHEET - BY QUARTER
(UNAUDITED)
3/31/96 6/30/96
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ASSETS
CURRENT ASSETS:
Cash $ 102,711 $ 35,810
Accounts Receivables (Net) 566,882 1,040,726
Miscellaneous Receivables 474,650 879,914
Prepaid Expenses 248,398 415,955
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Total Current Assets 1,392,641 2,372,405
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FIXED ASSETS:
Furniture and fixtures 58,844 58,843
Equipment 1,375,748 1,507,628
Software 357,921 363,054
Accumulated Depreciation (479,039) (545,039)
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Total Fixed Assets 1,313,473 1,384,486
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Total Assets $ 2,706,114 $ 3,756,891
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payable $ 1,624,914 $ 2,381,655
Accrued Liabilities 266,366 348,287
Note Payable 1,072,164 1,078,164
Capital Leases 8,322 5,631
Accrued Commissions 64,472 84,342
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Total Current Liabilities 3,036,238 3,898,079
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Long-term note payable 50,000 -
Captial Lease-Long Term 36,428 36,428
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Long Term Debt 86,428 36,428
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Total Liabilities 3,122,666 3,934,507
SHAREHOLDERS' EQUITY
Common Stock 1,662,500 1,963,000
Treasury Stock (174,300) (174,300)
Retained Earnings (1,934,049) (1,934,049)
YTD Earnings 29,297 (32,266)
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Total Equity (416,552) (177,615)
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Total Liabilities and Equity $ 2,706,114 $ 3,756,891
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OVERLOOK COMMUNICATIONS INTERNATIONAL CORPORATION
1996 PROFIT AND LOSS - BY QUARTER
(UNAUDITED)
FIRST QUARTER SECOND QUARTER YEAR-TO-DATE
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OCI Admin Fees $ 13,842 10,150 $ 23,992
Conferencing 14,940 21,250 36,190
Debit Card Revenue 367,149 695,405 1,062,554
Debit Card Trendar 286,394 246,450 532,844
Interactive Service 264,333 60,909 325,242
Long Distance Resale 46,891 216,782 263,673
long Distance LCI 127,282 120,497 247,779
Call Center 68,701 58,039 126,740
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Total Revenue 1,189,532 1,429,482 2,619,014
Communications 472,814 791,271 1,264,086
Contract Services 30,605 32,559 63,164
Royalties 21,000 7,827 28,827
Depreciation 50,000 66,000 116,000
Other Costs of Revenues 10,689 15,629 26,318
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Total Cost of Revenues 585,108 913,286 1,498,395
Gross Profit 604,424 516,196 1,120,619
Salaries/Wages 272,673 246,862 519,535
Employee Benefits 16,432 21,308 37,740
Payroll Taxes 30,260 22,407 52,667
Contract Labor 38,973 39,431 78,404
Commissions 53,783 65,462 119,245
Advertising 4,348 2,171 6,519
Travel & Entertainment 17,925 14,105 32,030
Rent & Utilities 58,727 58,455 117,182
Insurance 2,829 3,226 6,055
Repairs & Maintenance 1,064 4,160 5,224
Office Supplies 3,618 3,904 7,522
Misc. Expense 10,089 4,689 14,778
Bad Debt Expense 7,000 15,000 22,000
Dues/Subscriptions 472 725 1,197
Postage & Shipping 5,791 8,285 14,076
Legal & Accounting 16,658 25,850 42,508
Bank Fees/Charges 1,940 4,154 6,094
Taxes 4,506 3,222 7,728
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Total SG&A 547,088 543,416 1,090,504
Net Operating Inc. (Loss) 57,336 (27,220) 30,115
Interest Expense 28,036 34,343 62,379
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Profit before tax $ 29,299 $ (61,563) $ (32,264)
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OVERLOOK COMMUNICATIONS INTERNATIONAL
1996 CASH FLOW BY QUARTER
(UNAUDITED)
FIRST SECOND
QUARTER QUARTER
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OPERATING ACTIVITIES
Net income (loss) $ 29,299 $ (61,563)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation expense 50,000 66,000
Changes in operating assets and liabilities:
Accounts receivable (365,354) (473,842)
Receivable from related party (215,689) (405,262)
Other assets (65,834) (167,557)
Accounts payable 549,255 756,736
Accrued liabilities 84,525 101,791
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Net cash flows (used in) from operating activities 66,201 (183,697)
INVESTING ACTIVITIES
Investments in property and equipment (278,734) (137,013)
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Net cash flows used in investing activities (278,734) (137,013)
FINANCING ACTIVITIES
Repayment of capital lease obligation (2,613) (2,692)
Proceeds from shareholder loans 77,588 -
Repayment of shareholder loans (25,000) (14,000)
Proceeds from notes payable 152,242 20,000
Repayment of notes payable - (50,000)
Proceeds from issuance of common stock 25,000 300,500
Purchase of treasury stock - -
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Net cash flows from financing activities 227,217 253,808
Net (decrease) increase in cash 14,683 (66,902)
Cash at the beginning of the quarter 88,027 102,711
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Cash at the end of the quarter 102,711 35,810
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(b) PRO FORMA financial information:
Charter filed a 10-Q for the nine months ended September 30, 1996 and
included in that document is an unaudited balance sheet including the affects
of the transaction. Accordingly, no unaudited pro forma balance sheet is
included herein. Attached is an unaudited pro forma statement of combined
operations for the nine months ended September 30, 1996 and the notes thereto.
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UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996
<TABLE>
Historical (1) Pro Forma
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Charter Overlook
Communications Phoenix Communications Worldlink
International, Data International Communication
Inc. Systems, Inc. Corporation Inc. Adjustments Combined
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<S> <C> <C> <C> <C> <C> <C>
REVENUES:
Communications Services $ 1,536,189 $ 3,363,261 2,721,132 $ 7,620,582
Hardware and Software 1,998,694 1,204,890 3,203,584
Internet Connection Services 1,228,523 0 1,228,523
System Services 540,826 161,001 701,827
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TOTAL REVENUES $ 5,304,232 $1,365,891 $3,363,261 $2,721,132 $12,754,516
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COST OF REVENUES AND
OPERATING EXPENSES:
Data Communications and
Operations 2,614,573 104,702 2,415,135 2,403,185 7,537,595
Hardware and Software Cost 1,584,694 1,015,753 2,600,447
Sales and Marketing 968,410 91,629 356,103 135,631 1,551,773
General and Administrative 2,663,937 180,635 879,463 455,260 4,179,295
Bad Debts 188,164 26,000 127,223 341,387
Depreciation and Amortization 698,698 15,061 183,779 30,400 584,440(2) 1,512,378
Interest Expense 282,897 (3,346) 76,082 23,704 379,337
Other (Income) Expense 1,619 (2,271) (240) 10,086 9,194
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TOTAL COST OF REVENUES AND
OPERATIONS 9,002,992 1,402,163 3,936,322 3,185,489 584,440 18,111,406
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LOSS BEFORE INCOME TAXES AND
MINORITY INTEREST IN
CONSOLIDATED SUBSIDIARY (3,698,760) (36,272) (573,061) (464,357) (584,440) (5,356,890)
INCOME TAX PROVISION (BENEFIT)
MINORITY INTEREST IN CONSOLIDATED
SUBSIDIARY 12,783 (12,783)(3) 0
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NET LOSS $(3,685,977) $ (36,272) $ (573,061) $ (464,357) $(597,223)(2) $(5,356,890)
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LOSS PER COMMON SHARE $ (0.31) $ (0.24)
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WEIGHTED AVERAGE SHARES OUTSTANDING 11,886,440 21,876,312
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</TABLE>
SEE NOTES TO UNAUDITED PRO FORMA FINANCIAL INFORMATION
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CHARTER COMMUNICATIONS INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA FINANCIAL INFORMATION
SEPTEMBER 30, 1996
On March 21, 1996, Charter Communications International, Inc. (the Company)
acquired all of the outstanding common stock of Phoenix Data Systems, Inc.
(Systems) by immediately issuing 825,000 shares of the Company's common stock
valued at $2.00 per share and deferring the issuance of an additional 175,000
shares of common stock subject to warranties and covenants of Systems and
Systems shareholders that could be used to offset claims against Systems. All
claims against Systems have been settled and the 175,000 shares were issued
on September 20, 1996. Additionally, the Company acquired the remaining 10%
minority interest of Phoenix DataNet, Inc. (PDN) by issuing 150,000 shares of
the Company's common stock valued at $2.00.
On July 25, 1996, the Company entered into an agreement to acquire 100
percent of the issued and outstanding stock of Overlook Communications
International Corporation (OCI). The transaction involved the exchange of
9,000,000 shares of the Company's common stock for all of the outstanding
shares of OCI. The shares issued in transaction were valued at $2.00 per
share, the estimated fair market value as of the date the transaction was
consummated.
On September 13, 1996, the Company entered into an agreement to acquire 100
percent of the issued and outstanding stock of Worldlink Communications, Inc.
(Worldlink). The transaction involved the exchange of 1,850,000 shares of the
Company's common stock for all of the outstanding shares of Worldlink. The
shares issued in transaction were valued at $2.00 per share, the estimated
fair market value as of the date the transaction was consummated.
(1) Column includes unaudited historical financial information for Charter,
Systems, OCI and Worldlink and was obtained from the respective companies
financial statements.
(2) Adjustment to amortize goodwill acquired, totaling $24,414,478, over a
period ranging from five years to thirty years beginning January 1, 1996.
(3) Adjustment to eliminate minority interest in consolidated subsidiary,
Phoenix DataNet, Inc. as of January 1, 1996.
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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.
Dated: November 19, 1996
CHARTER COMMUNICATIONS INTERNATIONAL, INC.
By: /s/ David G. Olson
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David G. Olson, Chief Executive Officer
