<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-Q
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended September 30, 1996
------------------
or
[ ] Transition report pursuant to Section 13 or 15(d)of the Securities Exchange
Act of 1934
For the transistion period from ____________ to ____________
Commission File Number: 0-22712
VERITAS SOFTWARE CORPORATION
----------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 94-2823068
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
1600 Plymouth Street,
Mountain View, California 94043
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 415/335-8000
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. X YES NO
----- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of October 31, 1996:
Common Stock, No Par Value 13,478,940 shares
Page 1 of 14. The Exhibit Index is located on Page 13
<PAGE>
VERITAS Software Corporation
INDEX
PART I. FINANCIAL INFORMATION Page No.
- - ------------------------------ --------
Item 1. Financial Statements
Condensed Consolidated Balance Sheets at
September 30, 1996 and December 31, 1995 3
Condensed Consolidated Statements of Income for
the Three Months Ended September 30, 1996 and 1995,
and for the Nine Months Ended September 30, 1996 and 1995 4
Condensed Consolidated Statements of Cash Flows
for the Nine Months Ended September 30, 1996 and 1995 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II. OTHER INFORMATION
- - ---------------------------
Item 1. Legal Proceedings 11
Item 2. Changes in Securities 11
Item 3. Defaults Upon Senior Securities 11
Item 4. Submission of Matters to Vote of Security Holders 11
Item 5. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
Signatures 12
Index to Exhibits 13
2
<PAGE>
PART I. FINANCIAL INFORMATION
- - -----------------------------
ITEM 1. FINANCIAL STATEMENTS
- - ----------------------------
VERITAS Software Corporation
Condensed Consolidated Balance Sheets
(IN THOUSANDS)
September 30, December 31,
1996 1995
------------- ------------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents.................... $ 1,300 $ 2,345
Short-term investments....................... 34,470 27,409
Accounts receivable, net..................... 2,930 2,003
Prepaid expenses............................. 418 391
------- -------
Total current assets...................... 39,118 32,148
Property and equipment, net..................... 3,715 2,163
Notes and other assets.......................... 1,320 697
------- -------
$44,153 $35,008
------- -------
------- -------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable............................. $ 1,707 $ 653
Other accrued liabilities.................... 2,147 2,228
Deferred revenue............................. 1,488 1,339
Current obligations under capital leases..... 10 116
------- -------
Total current liabilities................. 5,352 4,336
Accrued rent..................................... 905 594
Shareholders' equity:
Common stock................................. 68,521 66,976
Accumulated deficit.......................... (30,625) (36,898)
------- -------
Total shareholders' equity................ 37,896 30,078
------- -------
$44,153 $35,008
------- -------
------- -------
See accompanying notes to condensed consolidated financial statements.
3
<PAGE>
VERITAS Software Corporation
Condensed Consolidated Statements of Income
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- -------------------
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
User license fees................................. $ 8,646 $ 5,425 $22,767 $14,152
Source license fees............................... 100 247 640 837
Services and training............................. 581 387 1,462 1,259
Porting........................................... 171 451 413 1,278
-------- -------- -------- --------
Net revenues............................. 9,498 6,510 25,282 17,526
Operating expenses:
Cost of revenues................................ 901 863 2,146 2,168
Product development............................. 2,826 1,671 7,489 4,445
Selling, general and administrative............. 2,692 1,956 7,225 5,619
In-process research and development............. - - 2,200 -
-------- -------- -------- --------
Total operating expenses................. 6,419 4,490 19,060 12,232
-------- -------- -------- --------
Operating income ................................. 3,079 2,020 6,222 5,294
Interest income, net............................ 534 391 1,339 1,005
Gain on sale of ViSTA operations................ - - - 1,726
-------- -------- -------- --------
Income before taxes............................... 3,613 2,411 7,561 8,025
Provision for income taxes...................... 479 169 1,288 563
-------- -------- -------- --------
Net income........................................ $ 3,134 $ 2,242 $ 6,273 $ 7,462
-------- -------- -------- --------
-------- -------- -------- --------
Net income per share.............................. $ 0.22 $ 0.16 $ 0.44 $ 0.55
-------- -------- -------- --------
-------- -------- -------- --------
Shares used in per share computation.............. 14,389 13,947 14,271 13,625
-------- -------- -------- --------
-------- -------- -------- --------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
4
<PAGE>
VERITAS Software Corporation
Condensed Consolidated Statements of Cash Flows
(Unaudited)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(IN THOUSANDS)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-----------------------
1996 1995
-------- --------
<S> <C> <C>
OPERATING ACTIVITIES
Net income..................................................... $ 6,273 $ 7,462
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation and amortization.................................. 1,166 889
Gain on sale of ViSTA operations............................... - (1,726)
In-process research and development............................ 2,200 -
Changes in operating assets and liabilities:
Accounts receivable........................................ (796) 921
Prepaid expenses .......................................... (27) (101)
Notes and other assets..................................... (455) (157)
Accounts payable .......................................... 1,054 (331)
Other accrued liabilities.................................. (81) (224)
Deferred revenue........................................... 149 (66)
Accrued rent............................................... 311 464
-------- --------
Net cash provided by operating activities.............. 9,794 7,131
-------- --------
INVESTING ACTIVITIES
Purchases of available for sale investments.................... (40,868) (40,302)
Redemption of available for sale investments................... 33,807 27,256
Purchase of equipment.......................................... (2,499) (1,793)
Proceeds from sale of ViSTA operations......................... - 2,172
Payment received on note....................................... 282 187
Purchase of ACSC............................................... (3,000) -
-------- --------
Net cash used in investing activities.................. (12,278) (12,480)
FINANCING ACTIVITIES
Principal payments under capital lease obligations............. (106) (232)
Proceeds from sale of common stock............................. 1,545 702
-------- --------
Net cash provided by financing activities............. 1,439 470
Net increase in cash and cash equivalents.......................... (1,045) (4,879)
Cash and cash equivalents at beginning of period................... 2,345 8,686
-------- --------
Cash and cash equivalents at end of period......................... $ 1,300 $ 3,807
-------- --------
-------- --------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
5
<PAGE>
VERITAS Software Corporation
Notes to Condensed Consolidated Financial Statements
September 30, 1996
(Unaudited)
1. Basis of presentation
The accompanying unaudited condensed financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for annual financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary
for a fair presentation have been included. Operating results for the nine
month period ended September 30, 1996 are not necessarily indicative of the
results that may be expected for the year ending December 31, 1996. The
following information should be read in conjunction with the financial
statements and notes thereto included in the Company's annual report on Form
10-K for the year ended December 31, 1995.
2. Use of estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
3. Net income per share
Net income per share has been computed using the weighted average number of
common shares outstanding, after giving effect to dilutive common stock
equivalents. Common stock equivalents consist of the dilutive shares issuable
upon the exercise of stock options and warrants (using the treasury stock
method).
4. Acquisition of ACSC
On April 1, 1996, the Company acquired all of the outstanding capital
stock of Advanced Computing Systems Company ("ACSC"), a company which
develops media management software, for a total cost of $3,450,000. Of the
total charge, $2,200,000 was allocated to in-process research and development
which was expensed in the second quarter of 1996 and approximately $1,250,000
was allocated to acquired intangibles which will be amortized over a three to
five year period. Total cash outflows in the second quarter of 1996 related
to this purchase were $3,000,000. The Company has agreed to pay the sole
shareholder of ACSC a royalty on certain future product revenue derived from
the assets acquired. The royalty will be based on product shipments beginning
in the third quarter of 1997 and will be payable over a five year period up
to a maximum of $2,500,000. For the nine months ended September 30, 1996 and
1995, the results of operations of ACSC were not material to the Company; and
accordingly pro forma information has not been provided.
5. Subsequent Event
On September 3, 1996, the Company announced a three for two stock split
which had an effective date of October 1, 1996.
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The accompanying unaudited condensed financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for annual financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary
for a fair presentation have been included. Operating results for the nine
month period ended September 30, 1996 are not necessarily indicative of the
results that may be expected for the year ending December 31, 1996. The
following information should be read in conjunction with the financial
statements and notes thereto included in the Company's annual report on Form
10-K for the year ended December 31, 1995.
This Form 10-Q contains forward-looking statements written in the
meaning of Section 21E of the Securities Exchange Act of 1934, as amended.
These forward-looking statements involve a number of risks and uncertainties,
including (i) the Company's timely development and market acceptance of new
non-OEM products, (ii) the timely creation of versions of the Company's
products for Microsoft Windows NT operating system ("Windows NT"), (iii) the
impact of Windows NT and other operating systems on the UNIX market upon
which the Company's current products are dependent (iv) the reliance on OEMs
to continue porting and shipping the Company's products, (v) the ability of
the Company to successfully expand the distribution of its products through
new and unproven channels, including resellers, integrators, distributors and
end-users, (vi) the uncertainty of the labor market, management issues and
local regulations in India where the Company's subsidiary provides software
development services, (vii) the Company's ability to hire and retain research
and development and sales personnel with appropriate skills in a highly
competitive labor market, and (viii) such risks and uncertainties as are
detailed from time to time in the Company's reports and filings with the
Securities and Exchange Commission ("SEC"), including the Form 10-K for the
year ended December 31, 1995 and the Company's Form 10-Q for the quarters
ended March 31, 1996 and June 30, 1996. The actual results that the Company
achieves may differ materially from any anticipated results described in the
forward-looking statements due to such risks and uncertainties.
The Company has used various sentences within this Form 10-Q which contain
such forward-looking statements, and words such as "believes", "anticipates",
"expects", "intends", and similar expressions are intended to identify
forward-looking statements, but are not the exclusive means of denoting the
same. The Company undertakes no obligation to revise any forward-looking
statements in order to reflect events or circumstances that may arise after
the date of this report. Readers are urged to carefully review and consider
various disclosures made by the Company in this report and in the Company's
other reports filed with the SEC that attempt to advise interested parties of
the risks and factors that may affect the Company's business.
RESULTS OF OPERATIONS
NET REVENUES
Net revenues increased to $9,498,000 in the third quarter of 1996 from
$6,510,000 for the same period of 1995, an increase of $2,988,000, or 46%.
Net revenues increased to $25,282,000 in the first nine months of 1996 from
$17,526,000 for the same period of 1995, an increase of $7,756,000, or 44%.
These increases primarily reflect a growth in user license fees. There were
no revenues associated with the ViSTA operations during the first nine months
of 1996, compared to $677,000 net revenues in the same period of 1995. ViSTA
was sold to CenterLine Software, Inc. ("Centerline") on March 31, 1995.
Excluding ViSTA, net revenues increased $8,433,000, or 50%, in the first nine
months of 1996 compared to the same period of 1995.
USER AND SOURCE LICENSE FEES
7
<PAGE>
User license fees increased to $8,646,000 in the third quarter of 1996
from $5,425,000 for the same period of 1995, an increase of $3,221,000, or
59%. User license fees increased to $22,767,000 in the first nine months of
1996 from $14,152,000 for the same period of 1995, an increase of $8,615,000,
or 61%. These increases primarily reflect the growth in OEM shipments of one
or more of the Company's storage management products and an increase in sales
of the Company's shrink wrap versions of products, including FirstWatch high
availability products acquired from Tidalwave Technologies, Inc.
("Tidalwave") in 1995. There were no user license fees associated with the
ViSTA operations during the first nine months of 1996, compared to $557,000
ViSTA user license fees in the same period of 1995. Excluding ViSTA, user
license fees increased $9,137,000, or 67%, in the first nine months of 1996
compared to the same period of 1995. Source license fees decreased to $100,
000 in the third quarter of 1996 from $247,000 for the same period of 1995.
Source license fees decreased to $640,000 in the first nine months of 1996
from $837,000 for the same period of 1995.
SERVICES AND TRAINING
Services and training revenue, primarily derived from annual maintenance
agreements and training, increased to $581,000 in the third quarter of 1996
from $387,000 for the same period of 1995, an increase of $194,000, or 50%.
Services and training revenue increased to $1,462,000 in the first nine
months of 1996 from $1,259,000 for the same period of 1995, an increase of
$203,000, or 16%. These increases reflect the increasing size of the
Company's installed base of customers and products. There were no ViSTA
services and training revenues during the first nine months of 1996, compared
to $120,000 of ViSTA service and training revenue in the first nine months of
1995. Excluding ViSTA, service and training revenue increased $323,000, or
28%, in the first nine months of 1996 compared to the same period of 1995.
PORTING
Porting revenue decreased to $171,000 in the third quarter of 1996 from
$451,000 for the same period of 1995, a decrease of $280,000, or 62%. Porting
revenue decreased to $413,000 in the first nine months of 1996 from
$1,278,000 for the same period of 1995, a decrease of $865,000, or 68%. The
Company generally does not seek porting or any other custom work, but the
Company does enter into agreements which it believes would result in useful
extensions to current products and result in the growth of user license fees.
COST OF REVENUES
Cost of revenues increased to $901,000 in the third quarter of 1996 from
$863,000 for the same period of 1995, an increase of $38,000, or 4%. Cost of
revenues decreased to $2,146,000 in the first nine months of 1996 from
$2,168,000 for the same period of 1995, a decrease of $22,000, or 1%. Cost of
revenues includes the costs associated with user and source license fees, the
costs of providing service and training to the Company's customers, and the
costs of porting and other non-recurring engineering services. Cost of
license fees increased to $331,000 in the third quarter of 1996 from $192,000
for the same period of 1995, an increase of $139,000, or 72%. Cost of license
fees increased to $867,000 in the first nine months of 1996 from $612,000 for
the same period of 1995, an increase of $255,000, or 42%. These increases are
primarily due to higher sales volumes and an increase in sales of products
requiring royalties paid to third parties. Cost of service and training
increased to $394,000 in the third quarter of 1996 from $264,000 for the same
period of 1995, an increase of $130,000, or 49%. Cost of service and training
increased to $938,000 in the first nine months of 1996 from $584,000 for the
same period of 1995, an increase of $354,000, or 61%. These increases reflect
increases in headcount necessary to support the increasing size of the
Company's installed base of customers and products. Cost of porting decreased
to $176,000 in the third quarter of 1996 from $407,000 for the same period of
1995, a decrease of $231,000, or 57%. Cost of porting decreased to $341,000
in the first nine months of 1996 from $972,000 for the same period of 1995, a
decrease of $631,000, or 65%. These decreases relate to the decrease in
porting revenues and corresponding costs during 1996.
8
<PAGE>
PRODUCT DEVELOPMENT
Product development expenses increased to $2,826,000 in the third
quarter of 1996 from $1,671,000 for the same period of 1995, an increase of
$1,155,000, or 69%. Product development expenses increased to $7,489,000 in
the first nine months of 1996 from $4,445,000 for the same period of 1995, an
increase of $3,044,000, or 68%. These increases in product development
expense were primarily attributable to increased headcount and related
recruiting expenses required to support new product development activities,
such as adapting the Company's products to run on the Windows NT operating
system. Total product development headcount increased to 87 at September 30,
1996 from 54 at September 30, 1995.
SELLING, GENERAL AND ADMINISTRATIVE
Selling, general and administrative expenses increased to $2,692,000 in
the third quarter of 1996 from $1,956,000 for the same period of 1995, an
increase of $736,000, or 38%. Selling, general and administrative expenses
increased to $7,225,000 in the first nine months of 1996 from $5,619,000 for
the same period of 1995, an increase of $1,606,000, or 29%. These increases
were primarily a result of an increase in the number of sales representatives
and marketing personnel employed by the Company and in the number of
marketing programs implemented by the Company as the Company continues to
invest in the development of non-OEM channels. Selling, general and
administrative expenses as a percentage of total net revenues decreased to
28% in the third quarter of 1996 from 30% in the third quarter of 1995.
Selling, general and administrative expenses as a percentage of total net
revenues decreased to 29% in the first nine months of 1996 from 32% in the
first nine months of 1995. These decreases were primarily due to increased
user license fees from OEM customers, which did not require a corresponding
increase in selling, general and administrative expenses. However, the
Company expects selling, general and administrative expenses to increase as a
percentage of revenues as non-OEM revenues begin to represent a larger
percentage of the Company's revenues.
IN-PROCESS RESEARCH AND DEVELOPMENT
On April 1, 1996, the Company acquired all of the outstanding capital
stock of Advanced Computing Systems Company ("ACSC"), a company which
develops media management software, for a total cost of $3,450,000. Of the
total charge, $2,200,000 was allocated to in-process research and development
which was expensed in the second quarter of 1996 and approximately $1,250,000
was allocated to acquired intangibles which will be amortized over a three to
five year period. Total cash outflows in the second quarter of 1996 related
to this purchase were $3,000,000. The Company has agreed to pay the sole
shareholder of ACSC a royalty on certain future product revenue derived from
the assets acquired. The royalty will be based on product shipments beginning
in the third quarter of 1997 and will be payable over a five year period up
to a maximum of $2,500,000. For the three months and nine months ended
September 30, 1996 and 1995, the results of operations of ACSC were not
material to the Company.
INTEREST INCOME
Interest income increased to $534,000 in the third quarter of 1996 from
$391,000 for the same period of 1995, an increase of $143,000, or 37%.
Interest income increased to $1,339,000 in the first nine months of 1996 from
$1,005,000 for the same period of 1995, an increase of $334,000, or 33%.
These increases reflect higher average investment balances.
GAIN ON SALE OF VISTA OPERATION
During the nine months ended September 30, 1995, the Company recognized
a gain of $1,726,000 on the sale of substantially all of the operating assets
of its ViSTA testing tools operation. Under the terms of the sale agreement,
the Company received a cash payment of $2,172,000 in 1995, was issued a
subordinated promissory note for $750,000 payable in quarterly installments
over a two year period and was granted the right to receive royalties on
ViSTA related products payable over three years.
9
<PAGE>
PROVISION FOR INCOME TAXES
The Company had an effective tax rate of 13% in the quarter ended September
30, 1996, compared to 7% for the same period of 1995. The Company had an
effective tax rate of 13% for the nine months ended September 30, 1996, before a
non-deductible expense of $2,200,000 for in-process research and development,
compared to 7% for the same period of 1995. The increase reflects the Company's
full utilization of its California loss carryforwards in the first quarter of
1996.
The Company's tax rate reflects the benefits of federal loss and credit
carryforwards. The federal tax loss carryforwards expire in 1996 through 2009.
The federal tax laws impose limitations on loss and credit carryforwards in the
event that changes in a company's stock ownership over a three year period
exceed a specified threshold (a "Change in Ownership"). Based on its analysis of
prior stock ownership changes, the Company believes that it has not incurred a
Change of Ownership. However, stock ownership changes have caused the percentage
of stock ownership change to be slightly below that which results in a Change of
Ownership, and sales of shares by shareholders of record prior to the initial
public offering within three years after the initial public offering may cause a
Change of Ownership to occur. In addition, the Company's analysis of its stock
ownership changes, which requires numerous assumptions, is subject to review by
the Internal Revenue Service (the "IRS"). If the IRS were to maintain that the
Company incurred a Change of Ownership, the Company would be subject to an
annual limitation on the utilization of its net operating loss and certain tax
credit carryforwards. However, given the Company's current fair market value,
such limitation, if any, is not expected to have a significant effect on the
Company's utilization of its net operation loss and tax credit carryforwards.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary source of liquidity during the first nine months
of 1996 and 1995, respectively, has been cash generated from operating
activities. At September 30, 1996, the Company had $35,770,000 in cash, cash
equivalents and short-term investments, compared to $29,754,000 at December
31, 1995, an increase of 6,016,000, or 20%. At September 30, 1996, the
Company had working capital of $33,766,000 compared to $27,812,000 at
December 31, 1995. The ratio of current assets to current liabilities at
September 30, 1996 was 7.31 to 1 compared to 7.41 to 1 at December 31, 1995.
CASH FLOWS FROM OPERATING ACTIVITIES
Cash provided by operating activities was $9,794,000 for the first nine
months of 1996, primarily reflecting higher revenues and income from operations
in the first nine months of 1996 compared to the same period of 1995.
CASH FLOWS FROM INVESTING ACTIVITIES
Cash used for investing activities in the first nine months of 1996 was
$12,278,000, including $7,061,000 used for the net purchase of short-term
investments, $2,499,000 used for the purchase of equipment, and $3,000,000
used for the purchase of ACSC. Cash provided by investing activities in the
first nine months of 1996 included $282,000 received on the note receivable
from Centerline.
CASH FLOWS FROM FINANCING ACTIVITIES
Cash provided by financing activities in the first nine months of 1996 was
$1,439,000, primarily provided by the exercise of stock options and the
issuance of common stock under the employee stock purchase plan.
The Company anticipates that its current cash, cash equivalents and
short-term investments will be sufficient to fund operating expenses at least
through fiscal 1996, including anticipated capital expenditures and future
acquisitions. The Company's long-term liquidity will be affected by numerous
factors, including its ability to generate cash from operations, its capital
requirements, future acquisitions and or dispositions, and the Company's
product development activities. The Company expects to continue to fund these
future
10
<PAGE>
activities from cash flows from operations and from future financings as
required. The Company may seek additional equity or debt financing to satisfy
future liquidity and capital resource needs, however, there can be no
assurance that capital will be available when needed or, if available, that
the terms for obtaining such funds will be favorable to the Company.
PART II. OTHER INFORMATION
- - --------------------------
ITEM 1. LEGAL PROCEEDINGS
- - -------------------------
Not applicable
ITEM 2. CHANGES IN SECURITIES
- - -----------------------------
Not applicable
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
- - ---------------------------------------
Not applicable
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS
- - ---------------------------------------------------------
Not applicable
ITEM 5. OTHER INFORMATION
- - -------------------------
Not applicable
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- - ----------------------------------------
(a) EXHIBITS
--------
The exhibits filed as a part of, or incorporated into, this Report on
Form 10-Q are listed in the accompanying Index to Exhibits on page 14.
(b) REPORTS ON FORM 8-K
-------------------
The Company did not file any reports on Form 8-K during the quarter
ended September 30, 1996.
11
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS
BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF MOUNTAIN
VIEW, STATE OF CALIFORNIA.
VERITAS Software Corporation
--------------------------------------
(Registrant)
November 12, 1996 /s/ Mark Leslie
- - ----------------- ---------------
(Date) Mark Leslie
President, Chief Executive Officer and
Director, Chief Financial Officer
(principal financial and accounting
officer)
12
<PAGE>
INDEX TO EXHIBITS
EXHIBIT
NUMBER EXHIBIT TITLE PAGE
- - ------- ------------- ----
2.01 Technology Acquisition Agreement dated March 31,
1995 between the Registrant and CenterLine Software,
Inc. (incorporated herein by reference to Exhibit
2.01 of the Registrant's Report on Form 8-K filed
with the Securities and Exchange Commission (the
SEC) on April 14, 1995)
2.02 Agreement and Plan of Reorganization between the
Registrant and Tidalwave Technologies, Inc. dated
April 10, 1995 (incorporated herein by reference to
the Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1995).
3.01 Registrant's Amended and Restated Articles of
Incorporation (incorporated herein by reference to
Exhibit 3.01 of the Registrant's Annual Report on
Form 10-K for the year ended December 31, 1993 (the
1993 Form 10-K))
3.02 Registrant's Amended Bylaws (incorporated herein by
reference to Exhibit 3.03 of the Registrant's
Registration Statement on Form S-1 (File No.
33-70726) filed with the SEC on October 22, 1993, as
amended (the Form S-1))
4.01 Form of Specimen Certificate for Registrant's Common
Stock (incorporated herein by reference to Exhibit
4.01 to the Form S-1)
4.02 Registration Rights Agreement dated April 6, 1995
between Registrant and certain Investors as defined
therein (incorporated by reference to Exhibit 4.02
of the Registrant's Registration Statement on Form
S-3 (file No. 33-95558) filed with the SEC on August
9, 1995, as amended
10.04 Registrant's 1993 Directors Stock Option Plan, as
amended.
10.05 Registrant's 1993 Employee Stock Purchase Plan, as
amended.
27.01 Financial Data Schedules 14
- - ---------------
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 1,300
<SECURITIES> 34,470
<RECEIVABLES> 3,055
<ALLOWANCES> 125
<INVENTORY> 74
<CURRENT-ASSETS> 39,118
<PP&E> 7,073
<DEPRECIATION> 3,358
<TOTAL-ASSETS> 44,153
<CURRENT-LIABILITIES> 5,352
<BONDS> 0
0
0
<COMMON> 68,521
<OTHER-SE> (30,625)
<TOTAL-LIABILITY-AND-EQUITY> 37,896
<SALES> 25,282
<TOTAL-REVENUES> 25,282
<CGS> 2,146
<TOTAL-COSTS> 2,146
<OTHER-EXPENSES> 16,914
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 7,561
<INCOME-TAX> 1,288
<INCOME-CONTINUING> 6,273
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,273
<EPS-PRIMARY> .44
<EPS-DILUTED> .44
</TABLE>
