<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
FORM 10-QSB
MARK ONE
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
or
[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF
THE EXCHANGE ACT
FOR THE TRANSITION PERIOD FROM TO .
------------- ---------------
COMMISSION FILE NO. 0-20312
------------------------------
VISTA INFORMATION SOLUTIONS, INC.
(Exact name of small business issuer as specified in its charter)
MINNESOTA 41-1293754
(State or other (I.R.S. Employer
jurisdiction of Identification No.)
corporation or
organization)
5060 SHOREHAM PLACE, #300, SAN DIEGO, CA 92122
(Address of principal executive offices)
(619) 450-6100
(Issuer's telephone number)
-------------------------------------------------------------------------------
(Former name, former address, and former fiscal year, if changed since last
report.)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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. YES X NO__
The number of shares of the Issuer's Common Stock, $0.01 par value,
outstanding on November 15, 1996 was 11,856,096.
Transitional Small Business Disclosure Format (check one) YES NO X
----- -----
<PAGE>
INDEX
-----
PART I FINANCIAL INFORMATION PAGE
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE 3
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND
1995 (UNAUDITED)
CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 4,5
1996 (UNAUDITED) AND DECEMBER 31, 1995
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE 6
THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(UNAUDITED)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF 8-11
OPERATION
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS. 12
ITEM 2. CHANGES IN SECURITIES. 12
ITEM 3. DEFAULTS UPON SENIOR SECURITIES. 12
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY 12
HOLDERS.
ITEM 5. OTHER INFORMATION. 12
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. 12
SIGNATURES 13
EXHIBIT INDEX 14
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
VISTA INFORMATION SOLUTIONS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1996 1995 1996 1995
- --------------------------------------------------------------------------------
Revenues $2,145,203 $2,277,491 $6,435,189 $5,553,289
Cost of revenues 493,889 856,445 1,541,953 2,188,448
---------- ---------- ---------- ----------
GROSS MARGIN 1,651,314 1,421,046 4,893,236 3,364,841
OPERATING EXPENSES
Sales and general and
and administrative 1,775,548 1,510,420 5,080,241 4,447,412
Research and
development 106,462 291,817 428,970 829,772
Depreciation and
amortization 1,158,932 1,572,984 3,385,833 3,530,948
---------- ---------- ---------- ----------
OPERATING LOSS (1,389,628) (1,954,175) (4,001,808) (5,443,291)
Other income (expense) (77,464) (147,934) (339,021) (259,134)
---------- ---------- ---------- ----------
NET LOSS ($1,467,092 ($2,102,109) (4,340,829) (5,702,425)
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
NET LOSS PER SHARE ($0.13) ($0.19) ($0.39) ($0.55)
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 11,282,481 10,965,923 11,130,570 10,394,575
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
See Notes to Financial Statements
3
<PAGE>
VISTA INFORMATION SOLUTIONS, INC.
CONSOLIDATED BALANCE SHEETS
SEPTEMBER DECEMBER 31
ASSETS 1996 1995
- --------------------------------------------------------------------------------
CURRENT ASSETS:
Cash and cash equivalents $ 1,625 $ 21,027
Trade accounts receivable, less
for doubtful accounts of
$236,700 and $248,500 respectively 1,495,911 1,843,782
Prepaid expenses & other assets 504,185 204,697
----------- ------------
TOTAL CURRENT ASSETS 2,001,721 2,069,506
EQUIPMENT, FURNITURE AND SOFTWARE,
Equipment and furniture 2,698,361 2,363,148
Purchased software 218,636 109,751
----------- ------------
2,916,997 2,472,899
Less accumulated depreciation and
amortization (2,037,305) (1,595,965)
----------- ------------
NET EQUIPMENT AND SOFTWARE 879,692 876,934
CAPITALIZED SOFTWARE DEVELOPMENT COSTS.
less accumulated amortization of
$1,300,419 and $1,212,919 respectively 104,848
ACQUIRED TECHNOLOGY AND ENVIRONMENTAL DATABASES,
less accumulated amortization of
$5,331,566 and $3,332,229 respectively 5,664,789 8,663,795
----------- ------------
$ 8,546,202 $11,715,083
----------- ------------
----------- ------------
See Notes to Financial Statements
4
<PAGE>
VISTA INFORMATION SOLUTIONS, INC.
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30 DECEMBER 31
---------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY 1996 1995
- --------------------------------------------------------------------------------
CURRENT LIABILITIES
Note payable to bank 202,164 1,111,790
Current maturities of long-term obligations 741,728 655,081
Trade accounts payable 670,671 1,029,574
Accrued development costs 487,500 487,500
Accrued compensation and employee benefits 112,986 380,910
Other current liabilities 340,643 398,325
------------ ------------
TOTAL CURRENT LIABILITIES 2,555,692 4,063,180
Long-term obligations, less current maturities 3,369,771 1,624,939
------------ ------------
TOTAL LIABILITIES 5,925,463 5,688,119
STOCKHOLDERS' EQUITY
Preferred stock, Series B convertible, par value $.01;
liquidation value $3,000,000,
authorized 200,000 shares; 200,000 shares
issued and outstanding 2,000 2,000
Preferred stock, Series C convertible, par value $.01;
liquidation value $10,802,185,
authorized 670,000 shares; 613,935 shares
issued and outstanding 6,439 6,439
Preferred stock, Series D convertible, par value $.01;
liquidation value $2,499,982,
authorized 240,000 shares; 187,134 shares
issued and outstanding 1,871 1,871
Common stock, par value $.01; authorized
43,890,000 shares, issued and outstanding
11,502,289 and 8,322,229 shares, respectively 117,897 109,898
Additional paid-in capital 28,024,024 27,097,419
Accumulated deficit (25,531,492) (21,190,663)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 2,620,739 6,026,964
------------ ------------
$8,546,202 $11,715,083
------------ ------------
------------ ------------
See Notes to Financial Statements
5
<PAGE>
VISTA INFORMATION SOLUTIONS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
NINE MONTHS ENDED
SEPTEMBER 30,
- -------------------------------------------------------------------------------
1996 1995
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ($4,340,829) ($5,702,425)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 3,385,833 3,965,291
Amortization of SIRROM warrant value 55,769
Changes in current assets and liabilities, net of
effect of acquisition of VISTA
(Increase) decrease in:
Accounts receivable - trade 402,293 (387,405)
Prepaid expenses & other assets (299,488) (121,417)
Increase (decrease) in:
Trade accounts payable (358,903) (56,388)
Accrued compensation and employee benefits (267,924) (81,807)
Other current liabilities (57,682) (123,421)
----------- -----------
NET CASH USED IN OPERATING ACTIVITIES (1,480,931) (2,507,572)
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of equipment and software (435,434) (207,435)
Additions to capitalized software development costs 0 (107,870)
Decrease in other assets 0 0
Cash acquired in acquisition of VISTA 0 29,546
------------ ------------
NET CASH USED IN INVESTING ACTIVITIES (435,434) (285,759)
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on long-term obligations (277,928) (197,337)
Proceeds from long-term obligations 322,168 78,101
Proceeds from issuance of preferred stock 2,499,020
Net proceeds from note payable to bank (909,626) 220,616
Net proceeds from ISO note payable 320,578
Proceeds from SIRROM note payable 2,341,857
Proceeds from issuance of common stock 99,914
------------ ------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 1,896,963 2,600,400
------------ ------------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (19,402) (192,931)
Cash and cash equivalents at beginning of period 21,027 223,913
Cash and cash equivalents at end of period $1,625 $30,982
------------ ------------
------------ ------------
SUPPLEMENTAL DISCLOSURES:
Value assigned to warrants related to note payable
to SIRROM $648,000
Debentures and accrued interest converted to
common stock $187,000
6
<PAGE>
VISTA Information Solutions, Inc.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996
(Unaudited)
- -------------------------------------------------------------------------------
1. BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information. In the opinion of management, the interim
financial statements include all adjustments (consisting of normal
recurring accruals) necessary for a fair presentation of the results for
interim periods presented. Operating results for the three months or nine
months ended September 30, 1996 are not necessarily indicative of the
operating results that will be achieved for the year or for any other
period. These statements should be read in conjunction with the Company's
Annual Financial Report on Form 10-K for the year ended December 31, 1995
and the Company's Quarterly Financial Reports on Form 10-QSB for the
quarters ended March 31, 1996 and June 30, 1996.
2. SIRROM FINANCING
On April 30, 1996, the Company entered into an agreement with the SIRROM
Capital Corporation for a $2,500,000 loan in the form of a 13.5 percent,
five year, interest only note with warrants to purchase 5 percent of the
fully diluted Common Stock at an exercise price of $0.01 per share. The
Company assigned a value to the warrants of $648,179 based on the fair
market value of the common stock at the date of grant. Accordingly, the
note payable has been discounted by this amount and bears an effective
interest rate of 22.4 percent.
3. ISO LOAN
In February, 1996, the Company entered into an agreement with ISO for a
loan, not to exceed $500,000. Advances commenced during the first week of
February 1996 in increments of $25,000 to $50,000. The Company borrowed
$375,000, and repaid approximately $54,000. Under this agreement,
advances bear interest at a rate of 1 percent per month on any outstanding
amounts, including accrued interest and repayment was to be made during
the last 6 months of 1996. The Company also has recorded a liability to
ISO for reimbursement of costs incurred by ISO for the development of the
Public Protection Classification (PPC) data layer of GUS in the amount of
$487,500 which represents the maximum amount VISTA could be liable for
under the terms of the agreement with ISO. The actual amount due to ISO
is presently in dispute. According to a Supplemental Agreement to the
Joint Services Agreement, if no agreement is reached by November 15, 1996,
VISTA and ISO will begin arbitration. Once an amount is determined, the
balance of the ISO loan, plus accrued interest, and the PPC liability will
be combined into a new loan bearing an interest rate 1.5 percent per
month. The total balance will be paid out of VISTA's share of GUS revenue
to the extent that it exceeds $120,000 per month (under certain
conditions, this monthly amount may be reduced to $200,000) until the
balance, plus accrued interest is paid.
3. NOTE PAYABLE TO BANK
On September 30, 1996, the Company entered into a factoring agreement with
Silicon Valley Bank. Transactions under the agreement are not treated as
a sale of receivables due to the existence of repurchase obligations. The
borrowings under this arrangement are collateralized by certain assets of
VISTA, including accounts receivable. The borrowing arrangement allows
the Company to borrow up to 80% of eligible receivables up to a maximum of
$1,000,000. Outstanding amounts bear interest at the rate of 1.5% per
month of all receivables used in the borrowing base. There are additional
administrative fees of 1% per month charged by the lender based on the
value of the receivables submitted for borrowing. The factoring agreement
provides for decreases in the interest rate if certain sales forecasts are
achieved.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATION
The following discussion and analysis provides information that the
Company's management believes is relevant to an assessment and understanding
of the Company's results of operations and financial condition. This
discussion should be read in conjunction with the financial statements and
related notes thereto which appear elsewhere in this Report.
The Company provides environmental risk information and address-based
hazard and classification information to bankers, engineers, insurance
companies and corporations throughout the United States. The Company,
originally known as DataMap, Inc. ("DMI"), was founded in 1975 to develop
geographic-demographic analysis tools for business ("GIS"). Supporting this
business line, the Company has developed a proprietary service known as the
Geographic Underwriting System ("GUS-Registered Trademark-") which delivers
address-based hazard and classification information to property/casualty
insurance underwriters. GUS provides insurance underwriters and loss control
groups of insurance companies with on-line or batch access to a series of
reports presenting specific classification and hazard information about the
property to be insured. The Company's geo-demographic information databases,
technological understanding and techniques of geographic information
processing provide the basis for its current products.
On February 28, 1995, the Company acquired all the outstanding common
stock of VISTA Environmental Information, Inc. ("VISTA Environmental") in
exchange for newly issued common and preferred shares of the Company. The
acquisition of VISTA Environmental expanded the Company's existing product
line to include environmental risk information and significantly increased
the marketing capability within the Company. VISTA Environmental provides
address and name based environmental risk information about properties and
companies in the United States to bankers, engineers and corporations. On
May 23, 1995, the Company changed its name from DataMap, Inc. to "VISTA
Information Solutions, Inc."
On February 1, 1996, the Company sold the assets relating to three
product lines to Business Information Technology, Inc. ("BITI"). These
product lines included the Company's: (i) compliance products for the
banking and mortgage industry, known as Census Traks Plus ("CTP"); (ii)
desktop marketing products, known as MarketPro ("MP"); and (iii) custom
mapping services, known as the Service Bureau business. As part of the asset
sale, VISTA also granted certain non-exclusive licenses to BITI for use of
the VISTA mapping module Geocoder 2.0, the "DataMap" name (for a limited
period of time) and ZIPR Extracts. The consideration provided to VISTA in
connection with the sale includes various royalty payments on the products
sold to BITI ranging from 5% to 25% of sales for a period of two years.
Accordingly, as a result of this sale, substantially all of the Company's GIS
revenue will be generated from the GUS product as of February 1, 1996.
8
<PAGE>
RESULTS OF OPERATIONS
COMPARISON OF THE THREE MONTHS ENDED SEPTEMBER 30, 1996 TO THE THREE MONTHS
ENDED SEPTEMBER 30, 1995 AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 TO
THE NINE MONTHS ENDED SEPTEMBER 30, 1995
Revenue
Total revenues decreased 6 percent from $2,277,000 for the three months
ended September 30, 1995, to $2,145,000 for the three months ended September 30,
1996 and increased 16 percent from $5,553,000 for the nine months ended
September 30, 1995, to $6,435,000 for the nine months ended September 30, 1996.
The third quarter decrease was due to the loss of approximately $153,000 in
revenue from certain product lines sold to BITI in February, 1996 and a decrease
in environmental revenue of approximately $205,000 partially offset by increases
in GUS revenue of approximately $226,000. The year-to-date increase was due
primarily to increases in environmental revenue of approximately $1,014,000
(primary the due to the acquisition of VISTA Environmental on February 28, 1995)
and increases in GUS revenue of approximately $452,000 offset by the loss of
approximately $584,000 in revenue from certain product lines sold to BITI in
February, 1996.
Gross Margin
Gross margins increased from 62 percent of revenue for the three months
ended September 30, 1995, to 77 percent of revenue for the three months ended
September 30, 1996 and from 61 percent of revenue for the nine months ended
September 30, 1995, to 76 percent of revenue for the nine months ended September
30, 1996. This increase was due to reduced payroll costs as a result of advances
in production technology as well as from the sale of certain product lines
(which generate lower gross margins than the GUS product) to BITI in February,
1996.
Operating Expenses
Operating expenses decreased 10 percent from $3,375,000 for the three
months ended September 30, 1995, to $3,041,000 for the three months ended
September 30, 1996 and increased 1 percent from $8,808,000 for the nine months
ended September 30, 1995 to $8,895,000 for the nine months ended September 30,
1996. The third quarter decrease was due primarily to a reduction of
amortization charges relating to the valuation write-up recorded at the time of
the VISTA Environmental acquisition, combined with reductions in research and
development resulting from the gradual completion of projects for the GUS system
and partially offset by an increase in sales, general and administrative
expenses. The year-to-date increase was primarily due to increased sales,
general and administrative expenses resulting from the VISTA Environmental
acquisition partially offset by decreases in research and development and
amortization expenses discussed above.
Interest Expense
Interest expense was significantly higher in the third quarter of 1996
compared to 1995 due to increased borrowing particularly relating to the SIRROM
loan financing (see liquidity and capital resources). The Company expects that
interest costs will continue to increase in 1996 with an increase in overall
debt levels as a result of financing transactions discussed below. Factors
influencing this forward looking information are the Company's ability to obtain
additional debt financing, the ability to generate positive cash flows from
operations and fluctuations in interest rates.
The Company had no taxable income and, accordingly, recorded no provision
for income taxes during the quarter or the nine months ended September 30, 1996
and 1995.
The effect of inflation on the Company's results has not been significant.
9
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company currently has negative cashflow from operations and has been
dependent on the raising of capital to fund continuing operations. From the
beginning of the fiscal year through September 30, 1996, the Company has raised
a total of $2.5 million in new long term debt and entered into a $1 million
accounts receivable factoring agreement with Silicon Valley Bank. The Company
has also obtained lease financing for equipment for approximately $400,000 and
is seeking additional lease financing for software of approximately $100,000,
although no assurance can be made that such financing will be available for
reasonable terms, if at all.
Net cash used in operating activities for the nine months ended September
30, 1996 was approximately $1,481,000 compared to $2,508,000 during the nine
months ended September 30, 1995. The decrease in net cash used was caused
primarily by an improvement in profitability and a decrease in trade accounts
receivable offset by reductions in accounts payable and current liabilities as a
result of financing transactions discussed below. The Company expects that cash
used in operating activities should continue to decrease in future periods as
current liabilities have been reduced substantially. This forward looking
information could be impacted by the Company's ability to meet sales
expectations and manage expenses although no assurances can be made that a level
of profitability sufficient to achieve these reductions can be maintained.
Net cash used in investing activities for the nine months ended September
30, 1996 was approximately $435,000 compared to $286,000 for the nine months
ended September 30, 1995. The increase in cash used was due to an increase in
purchases of computers and technological equipment partially offset by a
reduction in capitalized software development resulting from the completion of
certain projects for the GUS system. The Company has secured approximately
$400,000 in equipment lease financing and expects to uses a substantial portion
of this to acquire computer related equipment during the remainder of the year.
Net cash provided by financing activities was approximately $1,897,000
during the nine months ended September 30, 1996, compared to $2,600,000 during
the nine months ended September 30, 1995. Proceeds from the ISO, SIRROM and
Silicon Valley Bank loans discussed below as well as new lease financing were
the primary sources of cash provided in the first half of 1996. Proceeds from
the issuance of Series D Convertible Preferred Stock in connection with the
acquisition of VISTA Environmental was the major component of the cash provided
by financing activities in 1995.
In 1995, the Company received $446,000 from the sales of 16% subordinated
convertible debentures. In December, 1995 and March, 1996, the Company
defaulted on these obligations, as the required quarterly interest payments were
not made. In May, 1996, the Company remedied this default by offering the
holders the option to either (a) convert the debentures into Common Stock at a
rate of $0.75 of principal balance to one share of Common Stock, or (b) extend
the term of the debentures to March, 1997 with an option to convert the balance
to common stock at 70 percent of the then market price of the Common Stock. One
debenture holder elected to be repaid ($20,000 principal) and all other holders
elected option (b). During the second quarter of 1996, eight debenture holders
elected to convert their principal and accrued interest into common stock.
These transactions converted approximately $187,000 of debt and accrued interest
into 393,000 shares of common stock.
The Company has outstanding $898,928 of convertible subordinated
debentures assumed in the acquisition of VISTA Environmental. The debentures
are convertible into Series C Preferred Stock ("Series C Preferred Stock") at a
rate of $16.72 per share. At December 31, 1995, the debentures, including
accrued interest, were convertible into approximately 63,000 shares of Series C
Preferred Stock and were due in January 1996. In January 1996, the Company did
not repay the debentures. As a result, under the terms of the debentures, the
repayment date was extended to January 1997 and the debenture holders received,
in aggregate, warrants for the purchase of 3,732 shares of Series C Preferred
Stock at $16.72 per share. In January, 1997, the Company will have the option
to either pay these debentures off or extend them for another year.
10
<PAGE>
In February, 1996, the Company entered into an agreement with ISO for a
loan, not to exceed $500,000. Advances commenced during the first week of
February 1996 in increments of $25,000 to $50,000. The Company borrowed
$375,000, and repaid approximately $54,000. Under this agreement, advances bear
interest at a rate of 1 percent per month on any outstanding amounts, including
accrued interest and repayment was to be made during the last 6 months of 1996.
The Company also has recorded a liability to ISO for reimbursement of costs
incurred by ISO for the development of the Public Protection Classification
(PPC) data layer of GUS in the amount of $487,500 which represents the maximum
amount VISTA could be liable for under the terms of the agreement with ISO. The
actual amount due to ISO is presently in dispute. According to a Supplemental
Agreement to the Joint Services Agreement, if no agreement is reached by
November 15, 1996, VISTA and ISO will begin arbitration. Once an amount is
determined, the balance of the ISO loan, plus accrued interest, and the PPC
liability will be combined into a new loan bearing an interest rate 1.5 percent
per month. The total balance will be paid out of VISTA's share of GUS revenue
to the extent that it exceeds $120,000 per month (under certain conditions, this
monthly amount may be reduced to $200,000) until the balance, plus accrued
interest is paid.
On April 30, 1996, the Company entered into an agreement with the SIRROM
Capital Corporation for a $2,500,000 loan in the form of a 13.5 percent, five
year, interest only note with warrants to purchase 5 percent of the fully
diluted Common Stock at an exercise price of $0.01 per share. The Company
assigned a value to the warrants of $648,000 based on the fair market value of
the common stock at the date of grant. Accordingly, the note payable has been
discounted by this amount and bears an effective interest rate of 22.4 percent.
This note is secured by the tangible and intangible assets of the Company.
Proceeds have been used to retire amounts outstanding under the Company's
factoring agreement and to pay down existing payables.
On September 30, 1996, the Company entered into a factoring agreement with
Silicon Valley Bank. Transactions under the agreement are not treated as a sale
of receivables due to the existence of repurchase obligations. The borrowings
under this arrangement are collateralized by certain assets of VISTA, including
accounts receivable. The borrowing arrangement allows the Company to borrow up
to 80% of eligible receivables up to a maximum of $1,000,000. Outstanding
amounts bear interest at the rate of 1.5% per month of all receivables used in
the borrowing base. There are additional administrative fees of 1% per month
charged by the lender based on the value of the receivables submitted for
borrowing. The factoring agreement provides for decreases in the interest rate
if certain sales forecasts are achieved.
As reflected in the cash flow statement, the Company's operations
currently do not generate sufficient cash flows to meet the on-going cash needs
of the Company. The Company believes that the financing transactions discussed
above will be sufficient to fund operations for the next 12 months. Factors
impacting this forward looking information are the levels of the Company's
overall revenues and overhead expenses and changes in the Company's accounts
receivable and accounts payable turnover. If revenues do not increase as
anticipated, the Company may need to raise additional debt or equity financing
to meet its operating capital needs. In addition, the Company may need to raise
additional capital in the future to meet various strategic growth and research
and development initiatives. There can be no assurance that the Company will be
able to obtain any required additional funding on satisfactory terms, if at all.
If the additional funding is not obtained, the Company will seek alternative
sources of debt and/or equity financing and, to the extent necessary, will
reduce overhead expenditures.
11
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
On October 29, 1996, the Board of Directors for the Company elected
Richard Freeman as a member of the Board. Mr. Freeman had previously served
as a Board Observer for the Company. On that same date, Jay D. Seid was
elected as Chairman of the Board.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits:
b) Reports on Form 8-K.
None.
12
<PAGE>
SIGNATURE
In accordance to the requirements of the Securities Exchange Act of 1934, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
VISTA INFORMATION SOLUTIONS, INC.
(REGISTRANT)
DATE: NOVEMBER 15 , 1996 By /s/E. Stevens Hamilton
E. Stevens Hamilton
Chief Financial Officer
(Principal Financial Officer)
DATE: NOVEMBER 15, 1996 By /s/Brian Dean Conn
Brian Dean Conn
Controller
(Principal Accounting Officer)
13
<PAGE>
EXHIBIT INDEX
-------------
Exhibit
Number Description Location
-------- ----------- --------
27.1 Financial Data Schedule Filed electronically
14
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 1,625
<SECURITIES> 0
<RECEIVABLES> 1,732,611
<ALLOWANCES> 236,700
<INVENTORY> 0
<CURRENT-ASSETS> 2,001,721
<PP&E> 15
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
10,310
<COMMON> 117,897
<OTHER-SE> 2,492,532
<TOTAL-LIABILITY-AND-EQUITY> 8,546,202
<SALES> 2,145,203
<TOTAL-REVENUES> 2,145,203
<CGS> 493,889
<TOTAL-COSTS> 3,534,831
<OTHER-EXPENSES> 77,464
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 217,345
<INCOME-PRETAX> (1,467,092)
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