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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): May 28, 1998
SystemSoft Corporation
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(Exact name of Registrant as specified in Charter)
Delaware 0-24418 04-3121799
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(State or Other Jurisdiction of (Commission File Number) (IRS Employer
Incorporation) Identification No.)
One Innovation Drive, Natick, Massachusetts 01760
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (508) 651-0088
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(Former Name or Former Address, if Changed Since Last Report)
Total Number of Sequentially Numbered Pages 8.
Exhibit Index Appears on Page 4.
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ITEM 5. OTHER EVENTS.
On May 28, 1998, the Company issued a press release, a copy of which is
attached as Exhibit 99.1 to this Current Report on Form 8-K.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
Exhibit No. Exhibit
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99.1 Press Release of the Company dated May 28, 1998.
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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.
SYSTEMSOFT CORPORATION
Dated: June 3, 1998 By: /s/ Jeffrey R. Wakely
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Jeffrey R. Wakely,
Vice President, Finance
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EXHIBIT INDEX
Exhibit No. Description Page No.
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99.1 Press Release of the Company dated May 28, 1998. 5
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EXHIBIT 99.1
FOR IMMEDIATE RELEASE
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SYSTEMSOFT(R) ANNOUNCES Q1 FINANCIAL RESULTS
RESULTS IN LINE WITH PRE-ANNOUNCED PRELIMINARY RANGES
NATICK, Mass., -- May 28, 1998 -- SystemSoft(R) Corp. (NASDAQ: SYSF) today
reported financial results for fiscal Q1, ended April 30, 1998, of its 1999
fiscal year.
Revenue for Q1 was $4.0 million, a decrease of 68 percent from $12.5
million in the same period last year. SystemSoft also reported a net loss for
fiscal Q1 of $5.9 million or ($0.22) per basic share before taxes compared to
net income of $2.0 million or $.08 per basic share in the same period last year.
The Q1 results were within the preliminary ranges that SystemSoft pre-announced
on May 7.
SystemSoft attributed the revenue shortfall to several factors including a
softening market for its PC Card technologies, the impact of recent Asian
economic uncertainty on the Company's Taiwanese and Japanese customers, and the
rebuilding of its U.S. sales force during the quarter.
"While SystemSoft's fiscal first quarter results obviously disappointed us,
we are taking an aggressive stance to get back on track as soon as possible,"
said Robert F. Angelo, chairman and CEO of SystemSoft. "The customer agreements
and partnerships that we signed during the quarter for both the Support Products
and Platform Products Business Units demonstrate that we continue to address
real customer needs. Clearly, our challenge is to improve our ability to
translate SystemSoft's technology leadership position into stronger results."
"SystemSoft remains focused on attaining three primary goals over the next
several quarters: controlling operating expenses, conserving cash resources and
increasing revenue and profitability," said Deborah M. Besemer, president and
COO. "With a revamped sales force now in place, SystemSoft is better positioned
to capitalize on product opportunities within our OEM customer base, while
developing sales and distribution channels to reach the corporate market."
During the first quarter SystemSoft announced a technology development
partnership with Computer Associates International, Inc. (NYSE:CA) under which
SystemSoft will integrate SystemWizard with CA's Unicenter TNG Advanced Help
Desk (AHD) and Paradigm Service Desk product lines. In addition, Toshiba America
Information Systems (TAIS) began shipping a customized version of SystemWizard
on its new Equium 7000S and Equium 7000D corporate desktop PCs.
Also during the quarter, SystemSoft Corp. announced its system-level
software for the Intel(R) 440BX AGPset, which has been licensed by several OEMs,
including ASE, Chaplet, Clevo, Dual, Featron/Philips, Kapok, MiTAC, USI and
Veridata.
Any statements that are not historical facts contained in this release,
including but not limited to those relating to management's goals and
objectives, are forward looking statements. Those statements are subject to
risks and uncertainties that could cause actual results to differ materially
from those anticipated, including but not limited to those relating to product
demand, pricing, market acceptance, competitive products, risks in product and
technology development, and other risks identified in the Company's Securities
and Exchange Commission filings.
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ABOUT SYSTEMSOFT
SystemSoft is a leading worldwide provider of enabling software and support
technologies for the PC industry. Founded in 1990, the company reported annual
revenue of $42.6 million in its 1998 fiscal year. SystemSoft licenses its
products primarily to Original Equipment Manufacturers (OEMs), including PC
manufacturers and independent software and hardware vendors. Its customer
include Acer, Apple Computer, Compaq, Computer Associates, Dell, Gateway 2000,
Hewlett-Packard, Hitachi, IBM, Intel, Micron Electronics, Packard Bell NEC,
Sykes Enterprises, Inc., and Toshiba. Information on SystemSoft products and
services is available on the World Wide Web at http://www.systemsoft.com.
# # #
SystemWizard is a trademark and SystemSoft is a registered trademark of
SystemSoft Corp.
For more information, contact:
John Ambrose Tim Hurley/Jon Bornstein
SystemSoft Corporation Copithorne & Bellows
508/651-0088 617/450-4300
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SYSTEMSOFT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended April 30,
In Thousands, except per share data 1998 1997
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(Unaudited)
Revenues:
Software license fees $ 3,405 $10,856
Engineering services 607 1,621
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Total revenues 4,012 12,477
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Cost of revenues:
Software license fees 1,365 972
Engineering services 581 1,460
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Total cost of revenues 1,946 2,432
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Gross profit 2,066 10,045
Operating expenses:
Research and development 3,530 3,135
Sales and marketing 2,950 2,907
General and administrative 1,446 986
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Total operating expenses 7,926 7,028
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(Loss) income from operations (5,860) 3,017
Interest (expense) income, net (32) 29
Foreign exchange loss (7) (32)
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(Loss) income before provision for income taxes (5,899) 3,014
Provision for income taxes - 995
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Net (loss) income $(5,899) $ 2,019
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Per share net (loss) income
Basic $ (0.22) $ 0.08
Diluted $ (0.22) $ 0.08
Weighted average shares outstanding
Basic 26,679 25,024
Diluted 26,679 26,856
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SYSTEMSOFT CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
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April 30, January 31,
In Thousands 1998 1998
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(Unaudited)
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ASSETS
Cash and marketable securities $ 7,512 $ 10,764
Accounts receivable, net 4,709 6,328
Prepaid royalties 2,532 2,554
Other current assets 1,786 2,727
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Total current assets 16,539 22,373
Property and equipment, net 6,904 6,807
Purchased software costs, net 2,657 3,013
Software development costs, net 477 547
Other assets 597 819
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Total assets $ 27,174 $ 33,559
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LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable, accrued expenses and
other current liabilities 7,904 8,135
Other long-term liabilities 1,057 1,480
Common stock 269 268
Additional paid-in capital 83,423 83,328
Treasury stock (427) (427)
Accumulated other comprehensive income (672) (744)
Accumulated deficit (64,380) (58,481)
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Total stockholders' equity 18,213 23,944
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Total liabilities and stockholders' equity $ 27,174 $ 33,559
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