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 (Date of earliest event reported):
October 6, 1998
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Information Management Associates, Inc.
(Exact name of registrant as specified in its charter)
Connecticut
(State or Other Jurisdiction of Incorporation)
001-13211 06-1289928
(Commission File Number) (I.R.S. Employer Identification No.)
One Corporate Drive, Suite 414, Shelton, Connecticut, 06484
(Address of Principal Executive Offices) (Zip Code)
(203) 925-6800
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
<PAGE>
ITEM 5. OTHER EVENTS.
Attached hereto as Exhibit 99.1 and incorporated herein by reference is the
press release issued by Information Management Associates, Inc. (the
"Registrant") on October 6, 1998.
The following exhibit is filed as part of this report:
99.1 Press Release dated October 6, 1998.
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, thereunto duly authorized.
Date: October 6, 1998 INFORMATION MANAGEMENT
ASSOCIATES, INC.
By: /s/ Gary R. Martino
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Name: Gary R. Martino
Title: Chairman of the Board of
Directors, Chief Financial
Officer and Treasurer
FOR IMMEDIATE RELEASE
IMA Expects to Exceed Analysts' Third Quarter License Fee and Revenue
Estimates with Lower than Expected EPS for the Third Quarter
Due to a One Time Settlement Charge
SHELTON, Conn. -- Oct. 6, 1998 -- Information Management Associates, Inc.
(NASDAQ: IMAA) announced today that it expects to exceed analysts' estimates for
license fee and total revenue for the third quarter ended September 30, 1998.
IMA's preliminary estimates are that software license fees for the third quarter
will exceed $8.5 million, and total revenues will exceed $15.5 million,
representing growth over the third quarter of 1997 of more than 89% and 67%
respectively. IMA estimates that EPS on a fully taxed basis for the third
quarter will be in the range of $.03 to $.05 after the effect of a one-time
settlement charge including settlement and legal fees of approximately $2.2
million, or $.14 on a fully taxed basis. The settlement is described below.
"We are very excited about exceeding total revenue and software license fee
estimates in the third quarter," said Al Subbloie, president and CEO of IMA.
"These results demonstrate the continuing positive trend that IMA is
experiencing as a result of its expansion of sales and marketing. We are also
pleased with the growth of our sales pipelines in both the domestic and
international markets."
IMA also announced today that it has entered into a settlement agreement with
Rockwell International Corporation and certain of its affiliates ("Rockwell") in
connection with the pending litigation between Rockwell and IMA, relating to
claims by Rockwell regarding IMA's provision of a call center solution to United
States Cellular Corporation ("USCC"). Recently, Rockwell obtained a preliminary
injunction, pending a full trial on the merits of its claims, preventing IMA
from performing further work on the successful implementation of USCC's call
center solution using IMA's software products and services. The preliminary
injunction was based on Rockwell's claim that IMA received and was using certain
project specific documents at USCC that were derived from Rockwell proprietary
information that Rockwell had provided to USCC in connection with a
Rockwell-USCC project. Although IMA contested any wrong doing and filed an
appeal of the preliminary injunction decision, IMA decided to settle this matter
quickly to enable it to resume its business relationship with USCC, which
included an exercise of an option by USCC to license additional software for a
fee of $1,750,000 in the third quarter. Under the terms of the settlement, the
litigation has been dismissed and all claims by Rockwell relating to IMA's
relationship with USCC have been released. IMA agreed to pay Rockwell $1,750,000
in four installments over one year.
IMA also announced that it will restate results for the second quarter to
eliminate approximately $500,000 of services and maintenance revenues relating
to a new source of annual service fees. Management does expect to recognize this
revenue during the third and fourth quarters of 1998, with the maximum potential
third quarter benefit being an addition to EPS of $.01 on a fully taxed basis.
Restated revenues for the second quarter will be approximately $13.1 million and
restated net income for the second quarter will be approximately $1.3 million.
EPS for the second quarter on a fully taxed basis will be approximately $.08 per
share versus $.12 per share which was previously reported.
A conference call for investors and analysts regarding this press release has
been scheduled for Wednesday, October 7, 1998, at 9:00 a.m. est. You may obtain
the number in order to participate on this call by calling (203) 925-6836.
About IMA
IMA is a global leader in front office customer interaction solutions for call
centers used for sales, marketing and customer service. The company's Web- and
CTI-enabled software helps companies maximize the revenue- and
loyalty-generating potential of each customer contact. IMA is the choice of over
400 leading organizations including Bose Corporation, Dakotah Direct, Lloyds TSB
Bank, Pacific Gas and Electric, SNET and Xerox. IMA has headquarters in Shelton,
Conn., offices in Atlanta, Chicago, Frankfurt, Irvine, London, Melbourne and
Paris, and representatives worldwide. More information about IMA's products and
services can be found on the World Wide Web at www.imaedge.com, requested via
e-mail at [email protected], or by calling 1-800-776-0462.
NOTE: IMA and EDGE are registered trademarks of IMA.
Forward-Looking Statements
Except for the historical information contained in this announcement, the
matters discussed in this announcement are "forward-looking statements" (as that
term is used in the Private Securities Litigation Reform Act of 1995) that
involve risks and uncertainties detailed from time to time in the Company's
filings with the Securities and Exchange Commission (the SEC). In particular,
IMA draws the reader's attention to the "Risk Factors" stated in the Company's
Registration Statement on Form S-1 dated July 30, 1997 and its accompanying
Prospectus, the Company's Quarterly Reports on Form 10-Q dated August 14, 1997,
November 14, 1997, May 15, 1998, and August 14, 1998, the Company's Annual
Report on Form 10-K dated March 30, 1998, as well as to the Company's periodic
and current reports as they are filed with the SEC.
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CONTACTS: Press: Financial:
Bob Ventresca Gary Martino, Chairman and CFO
IMA IMA
(203) 925-6878 (203) 925-6800
[email protected]
