CROWN NORTHCORP INC
8-K/A, 1999-11-05
MANAGEMENT SERVICES
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 8-K/A

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported)     August 20, 1999

CROWN NORTHCORP, INC.

(Exact Name of Registrant as Specified in Charter)
         
Delaware 0-22936 22-3172740
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
     
1251 Dublin Road, Columbus, Ohio 43215
(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code     (614) 488-1169

Not Applicable

(Former name or former address, if changed since last report.)

Crown NorthCorp, Inc. hereby amends the following terms, financial statements, exhibits or other parts of this report on Form 8-K as set forth below:

Item 7.     Financial Statements, Pro Forma Information and Exhibits

(a) Financial Statements of Business Acquired

Not applicable

(b) Pro Forma Financial Information

The following pro forma financial information is included in Annex A attached hereto and filed as part of this report:

    • Pro Forma Condensed Consolidated Balance Sheet (Unaudited) as of June 30, 1999
    • Pro Forma Condensed Consolidated Statement of Income (Unaudited) for the Second Quarter Ended June 30, 1999
    • Pro Forma Condensed Consolidated Statement of Income (Unaudited) for the Six Months Ended June 30, 1999

(c)   Exhibits

    1. Purchase and sale agreement between Crown NorthCorp, Inc. and Catella Boardroom Consulting AB. (1)
 
    2. Purchase and sale agreement between Crown NorthCorp, Inc. and Catella Holding AB. (2)

    (1) Incorporated by reference to Exhibit 1 to the company’s Current Report on Form  8-K dated August 20, 1999 (Commission File No.  0-22936)
 
    (2) Incorporated by reference to Exhibit 2 to the company’s Current Report on Form  8-K dated August 20, 1999 (Commission File No.  0-22936)

2

SIGNATURE

      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.

  CROWN NORTHCORP, INC.

November 3, 1999
  By:  /s/ Stephen W. Brown
  Stephen W. Brown
Secretary

  By:  /s/ Ray L. Druseikis
  Ray L. Druseikis
Controller and Chief Financial Officer

3

INDEX TO EXHIBITS

1. Purchase and sale agreement between Crown NorthCorp, Inc. and Catella Boardroom Consulting AB.
 
2. Purchase and sale agreement between Crown NorthCorp, Inc. and Catella Holding AB.

4

ANNEX A

CROWN NORTHCORP, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)

June 30, 1999
                                   
Pro Forma
Historical(a) Adjustments Pro Forma
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 1,298,053 $ 2,563,633 (d) $ 3,861,686
Accounts receivable — net 1,173,129 (113,273 ) (b) 1,059,856
Prepaid expenses and other assets 189,477 — 189,477
Total current assets 2,660,659 2,450,360 5,111,019
PROPERTY AND EQUIPMENT — Net 363,899 363,899
RESTRICTED CASH 3,834,610 (659,291 ) (b) 3,175,319
OTHER ASSETS — net 5,056,372 (2,762,582 ) (c) 2,293,790
TOTAL $ 11,915,540 $ (971,513 ) $ 10,944,027
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES 1,064,826 104,245 (c) 1,169,071
LONG-TERM OBLIGATIONS:
Notes and bonds payable — less current portion 1,706,850 (979,754 ) (c) 727,096
Allowance for loan losses & other 769,640 — 769,640
Total long-term obligations 2,476,490 (979,754 ) 1,496,736
 
REDEEMABLE PREFERRED STOCK 1,400,000 1,400,000
 
SHAREHOLDERS’ EQUITY:
Common stock 111,201 111,201
Convertible preferred stock:
Series AA
Series BB
Additional paid-in capital 10,058,888 10,058,888
Accumulated deficit (3,195,538 ) (96,004 ) (d) (3,291,542 )
Treasury stock, at cost (327 ) — (327 )
Total shareholders’ equity 6,974,224 (96,004 ) 6,878,220
TOTAL $ 11,915,540 $ (971,513 ) $ 10,944,027

(a)  Historical Condensed Consolidated Balance Sheet (Unaudited) as of June 30, 1999.
(b)  Adjustments to reflect receipt of outstanding affiliate receivables and elimination of restrictions on cash securing letter of credit.
(c)  To reflect sale transaction and payoff of associated debt.
(d)  To adjust for net impact of pro forma income adjustments and cumulative impact of cash transactions.

CROWN NORTHCORP, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

FOR THE SECOND QUARTER ENDED JUNE 30, 1999
                                   
Pro Forma
Historical Adjustments Pro Forma
REVENUES:
Management fees $ 687,729 $ (100,053 ) (a) $ 587,676
Disposition and incentive fees 33,809 33,809
Other 263,722 (51,610 ) (a)
— 16,691 (b) 228,803
Total revenues 985,260 (134,972 ) 850,288
EXPENSES:
Personnel 1,237,614 (152,123 ) (a) 1,085,491
Occupancy, insurance and other 430,822 (16,785 ) (a) 414,037
Depreciation and amortization 87,984 — 87,984
Total expenses 1,756,420 (168,908 ) 1,587,512
Loss from operations before non-recurring items (771,160 ) 33,936 (737,224 )
Non-recurring income (expenses):
Gain on sale of building 260,616 — 260,616
LOSS FROM OPERATIONS (510,544 ) 33,936 (476,608 )
INTEREST EXPENSE 66,015 (16,007 ) (a) 50,008
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (576,559 ) 49,943 (526,616 )
INCOME TAX EXPENSE — — —
NET LOSS FROM CONTINUING OPERATIONS (576,559 ) 49,943 (526,616 )
DISCONTINUED OPERATIONS:
Loss on disposal of European interests, including provision of $149,000 for operating losses during phase-out period — (141,280 ) (c) (141,280 )
NET LOSS (576,559 ) (91,337 ) (667,896 )
LOSS PER SHARE — BASIC AND DILUTED $ (0.05 ) $ (0.06 )
WEIGHTED AVERAGE SHARES OUTSTANDING 11,098,836 11,098,836

(a)  To reflect revenue and expense reductions attributable to the elimination of European investment activity.
(b)  To reflect increased interest income attributable to higher investable cash balances.
(c)  To reflect net loss on sale of European investment interests.

CROWN NORTHCORP, INC. AND SUBSIDIARIES

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

FOR THE SIX MONTHS ENDED JUNE 30, 1999
                                   
Pro Forma
Historical Adjustments Pro Forma
REVENUES:
Management fees $ 1,542,124 $ (221,331 ) (A) $ 1,320,793
Disposition and incentive fees 66,182 66,182
Other 751,166 (171,032 ) (A)
— 33,382 (B) 613,516
Total revenues 2,359,472 (358,981 ) 2,000,491
EXPENSES:
Personnel 2,407,458 (301,033 ) (A) 2,106,425
Occupancy, insurance and other 899,944 (22,753 ) (A) 877,191
Depreciation and amortization 179,451 — 179,451
Total expenses 3,486,853 (323,786 ) 3,163,067
Loss from operations before non-recurring items (1,127,381 ) (35,195 ) (1,162,576 )
Non-recurring income:
Gain on sale of building 260,616 — 260,616
LOSS FROM OPERATIONS (866,765 ) (35,195 ) (901,960 )
INTEREST EXPENSE 132,796 (32,014 ) (A) 100,782
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (999,561 ) (3,181 ) (1,002,742 )
INCOME TAX EXPENSE — — —
NET LOSS FROM CONTINUING OPERATIONS (999,561 ) (3,181 ) (1,002,742 )
DISCONTINUED OPERATIONS:
Loss on disposal of European interests, including provision of $149,000 for operating losses during phase-out period — (141,280 ) (C) (141,280 )
NET LOSS (999,561 ) (144,461 ) (1,144,022 )
LOSS PER SHARE — BASIC AND DILUTED $ (0.09 ) $ (0.10 )
WEIGHTED AVERAGE SHARES OUTSTANDING 11,091,656 11,091,656

(A)  To reflect revenue and expense reductions attributable to the elimination of European investment activity.
(B)  To reflect increased interest income attributable to higher investable cash balances.
(C)  To reflect net loss on sale of European investment interests.



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