<PAGE>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
--------------------
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
Commission File Number 0-23098
--------------------
SOFTDESK, INC.
(Exact name of registrant as specified in its charter)
Delaware 02-0390273
----------
(State or other jurisdiction of (I.R.S. Employer
of incorporation or organization) Identification Number)
7 Liberty Hill Road
Henniker, New Hampshire 03242
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (603) 428-5000
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. Yes [X] No [_]
As of August 9, 1996 issuer had outstanding 6,003,709 shares of Common
Stock.
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SOFTDESK, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
Page
----
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
Condensed Consolidated Balance Sheets as of June 30, 1996
and December 31, 1995. 3
Condensed Consolidated Statements of Income for the three
and six months ended June 30, 1996 and 1995. 4
Condensed Consolidated Statements of Cash Flows for the
six months ended June 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 8
PART II - OTHER INFORMATION
ITEM 4. Submission of Matters to a Vote of Security Holders 12
ITEM 6. Exhibits and Reports on Form 8-K 12
SIGNATURES 13
EXHIBIT INDEX 14
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<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
SOFTDESK, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
<TABLE>
<CAPTION>
June 30, December 31,
Notes 1996 1995
----- ---------------- --------------------
(unaudited) (audited)
<S> <C> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 1,976 $ 4,800
Short-term investments 9,268 7,575
Accounts receivable 9,293 11,060
Inventory 640 671
Prepaid expenses and other current assets 4 1,820 1,402
Deferred income taxes 751 751
---------------- --------------------
Total current assets 23,748 26,259
---------------- --------------------
Plant, property and equipment, at cost:
Land 395 409
Buildings and improvements 2,164 2,002
Equipment 6,708 5,853
Furniture and fixtures 314 414
---------------- --------------------
9,581 8,678
Less: Accumulated depreciation (4,426) (4,085)
---------------- --------------------
5,155 4,593
Long-term investments 2,216 4,815
Deferred income taxes 103 103
Other assets, net 675 247
---------------- --------------------
Total assets $ 31,897 $ 36,017
================ ====================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of mortgage payable 3 $ - $ 34
Accounts payable 1,851 3,122
Accrued expenses 3,573 5,179
Customer advances 1,049 1,350
Accrued income taxes - 876
---------------- --------------------
Total current liabilities 6,473 10,561
---------------- --------------------
Mortgage payable, less current maturities 3 - 1,193
Commitments
Stockholders' equity: 5
Preferred stock, $.01 par value -
Authorized - 1,000,000 shares; Issued - none - -
Common stock, $.01 par value -
Authorized - 15,000,000 shares; Issued
and outstanding - 6,003,709 shares and
5,980,380 shares at June 30, 1996 and December 31,
1995, respectively 60 60
Additional paid-in capital 21,584 21,353
Retained earnings 3,821 2,973
Cumulative translation adjustment (41) (123)
---------------- --------------------
Total stockholders' equity 25,424 24,263
---------------- --------------------
Total liabilities and stockholders' equity $ 31,897 $ 36,017
================ ====================
The accompanying notes are an integral part of these financial statements.
</TABLE>
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SOFTDESK, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
Notes 1996 1995 1996 1995
----- ----------- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C>
NET REVENUES $ 9,283 $10,166 $18,236 $19,491
COST OF REVENUES 1,464 1,472 2,918 2,683
------------ ------------ ---------- ------------
Gross profit 7,819 8,694 15,318 16,808
OPERATING EXPENSES:
Selling and marketing expenses 3,768 3,520 7,474 6,732
Product development expenses 2,490 2,508 5,023 4,856
General and administrative expenses 812 694 1,659 1,370
Non recurring charges - 957 - 957
------------ ----------- --------- -----------
Total operating expenses 7,070 7,679 14,156 13,915
Income from operations 749 1,015 1,162 2,893
INTEREST INCOME 132 137 278 297
INTEREST EXPENSE 49 23 73 37
------------ ----------- --------- -----------
Income before provision for income taxes 832 1,129 1,367 3,153
PROVISION FOR INCOME TAXES 316 457 519 1,276
------------ ----------- --------- -----------
NET INCOME $ 516 $ 672 $ 848 $ 1,877
============ =========== ========= ===========
NET INCOME PER COMMON AND COMMON EQUIVALENT
SHARE 6 $ 0.09 $ 0.11 $ 0.14 $ 0.31
============ =========== ========= ===========
WEIGHTED AVERAGE NUMBER OF COMMON AND COMMON
EQUIVALENT SHARES OUTSTANDING 6 6,050 6,153 6,059 6,131
============ =========== ========= ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
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SOFTDESK, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
Notes 1996 1995
----- ------------------ ------------------
<S> <C> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net income $ 848 $ 1,877
Adjustments to reconcile net income to cash provided by
(used in) operating activities:
Depreciation and amorization 471 842
Foreign currency translation 76 (75)
Non recurring charges - 957
Changes in assets and liabilities, net of assets
acquired in connection with the acquisitions of
IdeaGraphix, Inc., Aritek Systems, Inc. and
Foresight Resources Corp.:
Accounts receivable 1,767 (2,166)
Inventory 31 (121)
Prepaid expenses and other current assets (418) (518)
Accounts payable (1,271) (184)
Accrued expenses 1 (1,606) 82
Customer advances (301) (84)
Accrued income taxes (876) 416
Net cash provided by (used in) operating ------------------------ -------------------
activities (1,279) 1,026
------------------------ -------------------
CASH FLOW FROM INVESTING ACTIVITIES:
Purchases of property and equipment, net (1,033) (1,911)
Increase in other assets (428) (154)
Cash acquired from the acquisition of Foresight
Resources Corp. - 28
Cash paid for the acquisitions of IndeaGraphix, Inc. and
Aritek Systems, Inc. - (200)
Increase in short-term investments (1,693) (2,714)
Decrease in long-term investments 2,599 2,727
------------------------- -----------------
Net cash used in investing activities (555) (2,224)
------------------------- -----------------
CASH FLOW FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock in connection
with the exercise of common stock options 231 210
Payments of notes payable - (1,473)
Proceeds (payments) on mortgage payable 3 (1,227) 1,084
------------------------- ------------------
Net cash used in financing activities (996) (179)
------------------------- ------------------
EFFECT OF FOREIGN CURRENCY TRANSLATION 6 (60)
------------------------- ------------------
Net decrease in cash and cash equivalents (2,824) (1,437)
Cash and cash equivalents, beginning of period 4,800 4,209
------------------------- ------------------
Cash and cash equivalents,end of period $ 1,976 $ 2,772
========================= ==================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash used for interest $ 73 $ 37
========================= ==================
Cash used for income taxes $ 1,617 $ 714
========================= ==================
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING ACTIVITIES:
In January 1996, the Company acquired SOFT-TECH Software
Technologie GmbH which was accounted for as a pooling of
interests. 2
The accompanying notes are an integral part of these financial statements.
</TABLE>
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SOFTDESK, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The unaudited condensed consolidated financial statements presented
have been prepared by Softdesk, Inc. and subsidiaries (the "Company")
and, in the opinion of management, reflect all adjustments, consisting
only of normal recurring adjustments, necessary for a fair presentation
of the financial results for the interim periods shown. The results of
operations for the interim periods shown in this report are not
necessarily indicative of results for any future interim periods or for
the entire fiscal year. Certain amounts in the 1995 financial statements
have been reclassified to conform to the 1996 presentation. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been omitted. Although the Company believes that the
disclosures included are adequate to make the information presented not
misleading, the condensed consolidated financial statements and the notes
included herein should be read in conjunction with the financial
statements and notes for the fiscal year ended December 31, 1995 and with
the section entitled "Certain Factors That May Affect Future Results"
included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1995.
2. Acquisition of SOFT-TECH Software Technologie GmbH
On January 22, 1996, the Company acquired SOFT-TECH Software
Technologie GmbH ("SOFT-TECH"), a German developer of architectural
software for the European marketplace. The Company exchanged 250,000
shares of common stock for all of the share capital of SOFT-TECH. The
Company placed 25,000 shares into escrow as security for indemnification
obligations of the SOFT-TECH stockholders relating to representations,
warranties and tax matters. This acquisition has been accounted for as a
pooling of interests and accordingly the Company has restated its
historical consolidated financial statements.
3. Mortgage Payable
In March 1995 the Company entered into two agreements with a bank for
the mortgage of its building in Germany. The $1,300,000 in proceeds from
the mortgage was used to purchase the building. In June 1996 the Company
retired the balance of the mortgage.
4. Software Licensing Agreement
In May 1996 the Company signed a software licensing agreement which
included approximately $830,000 in prepaid royalties. The Company
expects to amortize this amount through December 1998. At June 30, 1996
approximately $780,000 was included as a prepaid expense in the
accompanying balance sheet.
5. Stockholders' Equity
(a) 1993 Stock Option Plan
In December 1993, the Company adopted the 1993 Equity Incentive Plan
(the 1993 Plan). Under the terms of the 1993 Plan, the Company may grant
either incentive or nonqualified stock options to purchase common stock
and restricted common stock to employees and consultants. The Company
originally reserved 750,000 shares for issuance under the 1993 Plan. In
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April 1996, the Board of Directors of the Company approved an increase in
the number of shares reserved for issuance under the 1993 Plan to
1,150,000 shares. This increase was ratified by the Company's
stockholders at the 1996 Annual Meeting of Stockholders, which was held
on June 24, 1996 (the "Annual Meeting").
In addition, effective May 1, 1996, the Board of Directors of the
Company agreed to offer the Company's then current employees an
opportunity to forfeit existing common stock options in exchange for new
common stock options at the May 1, 1996 closing price of $13.25 for the
Company's Common Stock as reported by the Nasdaq National Market. The
new common stock options are for the same number of shares as the
forfeited stock options and the vesting of the new grant mirrors the
vesting of the options forfeited. The number of shares covered by
previously existing options which were forfeited and subsequently
regranted is 351,439.
(b) Employee Stock Purchase Plan
In January 1996, the Board of Directors of the Company adopted the
1996 Softdesk, Inc. Employee Stock Purchase Plan (the "Employee Plan").
The Employee Plan provides for 250,000 shares of the Company's common
stock to be issued in a series of offerings. This plan was approved by
the Company's stockholders at the 1996 Annual Meeting. Except for the
initial offering, offering periods are 12 months in length commencing
each January 1 and July 1 and expire when all shares are issued. The
initial offering commenced March 1, 1996 and is 10 months in length. The
price at which shares are sold in each offering will be 85% of the
closing price of the common stock on the first or last day of each
offering period, whichever is lower. Participants may have up to 10% of
their qualifying compensation deducted and set aside for purchasing
shares in each offering under the Employee Plan. The Employee Plan may
be terminated by the Board of Directors at any time.
6. Computation of Per Share Earnings
Income per common and common equivalent share is based upon net income
for the six months ended June 30, 1996 and 1995. Income per common and
common equivalent share has been determined, in accordance with the
treasury stock method, by dividing net income by the weighted average
number of common and common equivalent shares outstanding during the
period computed. Fully diluted and primary income per common share do
not differ materially for any of the periods presented.
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<PAGE>
ITEM 2. Management's Discussion and Analysis of Financial Condition
-----------------------------------------------------------
and Results of Operations
-------------------------
On January 22, 1996 Softdesk acquired all the outstanding capital
stock of SOFT-TECH Software Technologie GmbH ("SOFT-TECH"), a German
based developer of professional architectural software. The transaction
was accounted for as a pooling of interests and Softdesk has therefore
restated its historical consolidated financial statements and financial
information to reflect the combined financial condition and results of
operations of the two entities for all periods presented. (See Note 2 to
the Condensed Consolidated Financial Statements.) The following
discussions refer to the combined consolidated Company. These
discussions should be read in conjunction with the Company's 1995 Annual
Report on Form 10-K for the year ended December 31, 1995 including the
section entitled "Certain Factors That May Affect Future Results".
Results of Operations: Three and Six Months Ended June 30, 1996 and 1995
Net revenues decreased approximately 9% in the second quarter of 1996
as compared to the same period in 1995 while they decreased 6% during the
six months ended June 30, 1996 as compared to the same period in 1995.
The revenue decrease was primarily attributable to the decrease in sales
of the Company's high-range professional software products, especially
its products for the AutoCAD markets which historically have represented
a majority of the Company's total revenues. The Company believes that
sales of its software for this market decreased during the three and six
month periods of 1996 because of delays in the final release of
Autodesk's AutoCAD release 13. In addition, the Company believes that
the decline of its high-range product sales was also a result of
customers delaying their software purchases until they completed their
purchases of new computer hardware required to transition from a DOS to a
Windows operating environment, on which AutoCAD release 13 and many of
the Company's new releases of software are optimized. To a lesser
extent, the Company believes that less favorable economic conditions in
Europe, especially in the Architecture, Engineering and Construction
markets, also contributed to the decline in revenues in the 1996 periods.
Partially offsetting the decline in these software sales was an increase
in sales of the Company's low to mid-range product lines, including
Retail products, which the Company believes was attributable to the
release of new products during the 1996 periods combined with an
expansion of their "shelf space" in the retail stores that offer these
products for sale.
International revenues decreased 21% during the second quarter and 18%
during the first six months of 1996 as compared with the same periods in
1995. The declines in international revenues in both of the 1996 periods
were primarily caused by reduced revenues from Europe and Canada. The
decline in European revenues was a result of decreased sales in Germany
of the Spirit Software line which was in the final stages of a new
release during the beginning of 1996. To a lesser extent the Company
believes that less favorable economic conditions in Europe also
contributed to the decline in international revenues in the 1996 periods.
The decline in Canadian revenues was primarily a result of the transition
to a new distributor in early 1996. The Company believes that a somewhat
stronger U.S. Dollar as measured against the major international
currencies during the three and six month periods of 1996, as compared to
the comparable periods in 1995, also contributed to the decline in
international revenues.
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<PAGE>
The following table summarizes total revenues by geographic region
(amounts are in thousands):
<TABLE>
<CAPTION>
Three months Three months Six months Six months
ended ended ended ended
June 30, 1996 June 30, 1995 June 30, 1996 June 30, 1995
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
United States $6,689 72% $ 6,864 68% $13,094 72% $13,189 68%
Europe 1,777 19 2,304 23 3,604 19 4,512 23
Asia Pacific 375 4 389 4 694 4 684 3
Other 272 3 243 2 521 3 408 2
Canada 170 2 366 3 323 2 698 4
------------- ------------- ------------- -------------
$9,283 100% $10,166 100% $18,236 100% $19,491 100%
</TABLE>
The Company's revenues are primarily denominated in U.S. Dollars.
However, revenues and expenses for foreign operations, particularly the
Company's German subsidiary, are usually recorded in the applicable
foreign currency and translated with any applicable foreign exchange
adjustments. There were no foreign exchange transactions or translation
gains or losses that were material to the Company's financial results in
either of the three and six month periods ended June 30, 1996 or June 30,
1995. In addition, during these periods the Company's financial results
were not materially affected by inflation.
Total costs and expenses increased to 92% of net revenues in the
second quarter of 1996 from 90% of net revenues in the same quarter in
1995. For the six months ended June 30, 1996 total costs and expenses
increased to 94% of net revenues from 85% of net revenues during the same
period in 1995. As a percentage of revenue, the 2 percentage point
quarterly comparative increase in total costs and expenses consisted of a
1 percentage point increase in the cost of revenues and a 1 percentage
point increase in other costs and expenses. As a percentage of revenue,
the 9 percentage point six month comparative increase in total costs and
expenses consisted of a 2 percentage point increase in the cost of
revenues and a 7 percentage point increase in other costs and expenses.
These items are discussed below. Although the Company's headcount totaled
254 at the end of June 1996 as compared to 265 at the end of June 1995,
the 1996 quarterly and six month average headcount was actually higher
than that during the comparable periods in 1995 due to an acquisition at
the end of the second quarter of 1995. The higher average headcount
during the 1996 periods also contributed to increased expenses. The
Company's headcount had decreased to 251 as of August 9, 1996.
Gross profit margin decreased to approximately 84% in the second
quarter of 1996 from 85.5% in the second quarter of 1995. For the six
months ended June 30, 1996 gross profit margin decreased to approximately
84% from approximately 86% during the comparable period of 1995. The
decreases were primarily attributable to a shift in the overall product
mix toward lower margin products which included the Company's low to mid-
range product lines and, to a lesser extent, to the lack of the benefit
caused by economies of scale which usually occur with increasing
revenues, as was the case during the three and six month periods of 1995.
Softdesk continues to monitor and react to market events and developments
in an attempt to improve its gross margin levels.
Selling and marketing expenses, which include distribution, marketing,
and training, increased 7% in the second quarter of 1996 and 11% in the
first six months of 1996 from their totals in the 1995 respective
periods. For both the second quarter of 1996 and the six months ended
June 30, 1996 selling and marketing expenses were 41% of net revenues, as
compared to 35% in both of the comparable 1995 periods. The increases in
expenses were primarily a result of increased trade show, public
relations and advertising expenses. The increases were also partially
attributable to an increased average sales and marketing headcount, which
contributed to increased salary and travel costs. These increases were
partially offset
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by a decrease in total commission expense which resulted from the decrease in
revenues in the first half of 1996 as compared to the first half of 1995. As
Softdesk attempts to expand its sales and marketing programs during 1996, in an
effort to increase its market share and revenues, increased expenditures in
sales and marketing are planned.
Product development expenses, which consist primarily of developers'
wages and benefits, decreased 1% in the second quarter of 1996 while
increasing 3% in the first half of 1996 from their totals in the
comparable periods of 1995. As percentage of net revenues, product
development expenses represented 27% of revenues in the second quarter of
1996 and 28% of revenues in the first six months of 1996 as compared to
25% of revenues in both the second quarter of 1995 and the first six
months of 1995. These slight differences are primarily a result of
changes in headcount, which was lower in the second quarter of 1996 but,
on average, higher during the first half of 1996, as compared to the
similar periods in 1995. There were no capitalized product development
costs in the first half of 1996 or in the first half of 1995, as
determined in accordance with Statement of Financial Accounting Standards
No. 86. The Company may increase its product development expenses in the
remainder of 1996 or make acquisitions of third party technologies to
keep pace with the technological needs of the marketplace, to improve and
expand the Company's product lines and to respond to its customers'
needs.
General and administrative expenses, which include the costs of the
Company's corporate finance, human resource and administrative functions,
increased 17% in the second quarter of 1996 and 21% in the first six
months of 1996 from their respective totals in the comparable periods in
1995. G&A expenses represented 9% of both the 1996 quarterly and six
month net revenues, as compared to 7% in the comparable periods in 1995.
The increase in expenses was primarily due to increased salaries, bad
debt expense and higher professional fees. These increases were somewhat
offset by savings generated by the continued centralization and
consolidation of administrative functions on a company-wide basis.
Additional resources will be invested in the general and administrative
areas as required by the Company's future growth.
The Company recorded a non-recurring charge of $957,000 in the quarter
and six months ended June 30, 1995. This charge represented a write-off
of purchased research and development relating to its acquisitions in the
second quarter of 1995 and the Company's periodic assessment of its
realizable purchased product development. There was no such charge in
either the quarter or the six months ended June 30, 1996.
Net interest income decreased 27% in the second quarter of 1996 and
decreased 21% in the first half of 1996 as compared to the applicable
periods in 1995. The net decreases were primarily due to significantly
higher interest expense in the first half of 1996 from a mortgage related
to the purchase of facility space in Germany. This mortgage was retired
at the end of June 1996. In addition, the Company had somewhat lower
average cash balances earning interest during the 1996 periods.
The Company's consolidated provision for income taxes decreased 31% in
the second quarter of 1996 as compared to the first quarter of 1995 while
it decreased 59% in the first half of 1996 as compared to the same period
in 1995, due to the decreased pretax earnings in the applicable periods
of 1996. The Company's effective income tax rate decreased to 38% in the
second quarter and first six months of 1996 from 40% in the second
quarter and first six months of 1995 primarily due to the level of
foreign earnings and the taxability of certain of the 1995 non recurring
charges included in the accompanying statements of income.
The Company's net income in the second quarter of 1996 was $516,000,
or $.09 per share, as compared to net income in the second quarter of
1995 of
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<PAGE>
$672,000, or $.11 per share. Net income for the six months ended
June 30, 1996 totaled $848,000, or $.14 per share, as compared to
$1,877,000, or $.31 per share for the six months ended June 30, 1995.
Liquidity and Capital Resources
The Company is currently satisfying its operating cash requirements
from its existing cash balances. As of June 30, 1996, the Company had
cash, cash equivalents, short and long term investments of $13,460,000 as
compared to $17,190,000 at December 31, 1995.
The decrease in total cash and investments during the first half of
1996 was attributable primarily to the Company's payment of income taxes
($1,617,000), the retirement of a mortgage on a facility in Germany
($1,227,000), the net investment in capital assets ($1,033,000), the
completion of a software licensing contract including prepaid royalties
($830,000), and, to a lesser extent, funds used to complete the SOFT-TECH
acquisition. During the six months ended June 30, 1996 the Company
received $231,000 from the exercise of stock options and reduced its net
accounts receivable by approximately $1,800,000.
The purchase of property and equipment was primarily related to the
addition of computer equipment and software including a new corporate MIS
and telecommunication system. Management of the Company plans to continue
to invest in these efforts during the next 12 months. In addition, the
Company is in the process of expanding its corporate headquarters. These
expenditures are not expected to have a material effect on the Company's
overall cash position or its operations during the next 12 months.
During the first six months of 1996 and 1995 the Company invested its
cash reserves mainly in debt securities, with maturities of less than 2
years, issued by the U.S. treasury, other U.S. government agencies and
political subdivisions of the states and municipalities. The Company
expects to continue similar conservative investment policies in the
future. The Company believes that its existing cash, investments and
projected funds from operations will satisfy the Company's working
capital and operating needs for at least the next 12 months.
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<PAGE>
PART II. OTHER INFORMATION
ITEM 4. Submission of Matters to a Vote of Security Holders
(a) The following information relates to matters submitted to a vote of
stockholders at the Annual Meeting of Stockholders of Softdesk,
Inc. held on June 24, 1996.
(b) Proxies for the meeting were solicited and there was no
solicitation in opposition to management's nominee for Class III
Director as listed in the proxy statement and such nominee was
elected. David C. Arnold was elected as the Class III Director.
All other directors, previously in office and previously duly
elected continued in office subsequent to the meeting.
(c) The total number of shares entitled to vote at the Annual Meeting
of Stockholders was 5,995,476. The total shares voted were
5,629,874 or approximately 94% of those eligible to vote.
The vote for Class III Director was: 1) David C. Arnold, 5,420,952
votes in favor and 208,922 votes withheld.
Approval was granted to ratify the adoption of the Company's 1996
Employee Stock Purchase Plan. The vote was 4,622,325 for approval,
378,486 against approval, 11,487 abstentions, and 617,576 broker
non-votes.
Approval was granted to ratify the amendment to the Company's 1993
Equity Incentive Plan. The vote was 2,584,529 for approval,
2,348,786 against approval, 15,030 abstentions, and 681,529 broker
non-votes.
Approval was granted to the proposal that Arthur Andersen LLP be
appointed as the Company's independent auditors for 1996. The vote
was 5,594,078 for approval, 28,059 against approval, 7,737
abstentions, and 0 broker non-votes.
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 11.1 Computation of Per Share Earnings.
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K
The Company filed a Current Report on Form 8-K/A on April 8,
1996 regarding the acquisition of SOFT-TECH Software
Technologie GmbH.
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<PAGE>
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.
SOFTDESK, INC.
Date: August 12, 1996 By: /s/ David C. Arnold
---------------------------------------
David C. Arnold,
President & Chief Executive Officer
Date: August 12, 1996 By: /s/ John A. Rogers
---------------------------------------
John A. Rogers,
Vice President, Finance
and Chief Financial Officer
(Principal financial and accounting
officer)
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<PAGE>
EXHIBIT INDEX
-------------
Page
----
11.1 Computation of Per Share Earnings 15
27 Financial Data Schedule (EDGAR) 16
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<PAGE>
EXHIBIT 11.1
COMPUTATION OF PER SHARE EARNINGS
(In thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Six Months
Ended Ended
June 30, June 30,
------------------------- -------------------------
Weighted Average Number of Shares Outstanding 1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Common Stock 6,001 5,931 5,994 5,925
Common equivalent shares resulting from stock options issued
(treasury stock method) 49 222 65 206
-------- -------- -------- --------
Total 6,050 6,153 6,059 6,131
======== ======== ======== ========
Net income applicable to common stock $ 516 $ 672 $ 848 $1,877
======== ======== ======== ========
Net income per common stock $0.09 $0.11 $0.14 $0.31
======== ======== ======== ========
</TABLE>
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<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1996 DEC-31-1996
<PERIOD-START> APR-01-1996 JAN-01-1996
<PERIOD-END> JUN-30-1996 JUN-30-1996
<CASH> 1,976 1,976
<SECURITIES> 9,268 9,268
<RECEIVABLES> 9,293 9,293
<ALLOWANCES> 0 0
<INVENTORY> 640 640
<CURRENT-ASSETS> 23,748 23,748
<PP&E> 9,581 9,581
<DEPRECIATION> 4,426 4,426
<TOTAL-ASSETS> 31,897 31,897
<CURRENT-LIABILITIES> 6,473 6,473
<BONDS> 0 0
0 0
0 0
<COMMON> 60 60
<OTHER-SE> 25,364 25,364
<TOTAL-LIABILITY-AND-EQUITY> 31,897 31,897
<SALES> 9,283 18,236
<TOTAL-REVENUES> 9,283 18,236
<CGS> 1,464 2,918
<TOTAL-COSTS> 8,534 17,074
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 49 73
<INCOME-PRETAX> 832 1,367
<INCOME-TAX> 316 519
<INCOME-CONTINUING> 516 848
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 516 848
<EPS-PRIMARY> 0.09 0.14
<EPS-DILUTED> 0.09 0.14
</TABLE>
