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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________________ to __________________
Commission file number 0-21985
SEEC, INC.
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 55-0686906
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(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
PARK WEST ONE, SUITE 200, CLIFF MINE ROAD, PITTSBURGH, PENNSYLVANIA 15275
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(Address of Principal Executive Offices) (Zip Code)
(412) 893-0300
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(Registrant's Telephone Number, Including Area Code)
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 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
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As of July 31, 2000, there were 6,071,203 outstanding shares of Common
Stock, par value $.01 per share, of SEEC, Inc.
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SEEC, INC.
FORM 10-Q
TABLE OF CONTENTS
<TABLE>
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PAGE
NUMBER
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<S> <C>
PART I--FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Operations for the three months ended June 30, 2000 and 1999...... 2
Condensed Consolidated Balance Sheets as of June 30, 2000 and March 31, 2000................. 3
Condensed Consolidated Statements of Cash Flows for the three months ended June 30, 2000
and 1999 .................................................................................... 4
Notes to Unaudited Consolidated Financial Statements......................................... 5-6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.... 6-9
Item 3. Quantitative and Qualitative Disclosures about Market Risk............................... 10
PART II--OTHER INFORMATION
Item 1. Legal Proceedings........................................................................ 11
Item 2. Changes in Securities.................................................................... 11
Item 3. Defaults Upon Senior Securities.......................................................... 11
Item 4. Submission of Matters to a Vote of Security Holders...................................... 11
Item 5. Other Information........................................................................ 11
Item 6. Exhibits and Reports on Form 8-K......................................................... 11-12
SIGNATURES........................................................................................ 13
</TABLE>
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PART I -- FINANCIAL INFORMATION
Item 1. Financial Statements
SEEC, INC.
Consolidated Statement of Operations
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30,
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2000 1999
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<S> <C> <C>
Revenues:
Software license and maintenance fees $ 681,224 $ 1,219,433
Professional services 393,703 784,463
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Total revenues 1,074,927 2,003,896
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OPERATING EXPENSES:
Cost of revenues:
Software license and maintenance fees 112,919 184,200
Professional services 332,157 490,874
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Total cost of revenues 445,076 675,074
General and administrative 579,972 536,557
Sales and marketing 1,185,476 1,513,171
Research and development 473,517 382,425
Amortization of goodwill and other intangible assets 140,708 36,097
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Total operating expenses 2,824,749 3,143,324
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LOSS FROM OPERATIONS (1,749,822) (1,139,428)
NET INTEREST INCOME 341,341 375,855
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LOSS BEFORE INCOME TAXES (1,408,481) (763,573)
INCOME TAX BENEFIT -- (100,000)
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NET LOSS $(1,408,481) $ (663,573)
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Net loss per common share:
Basic $(0.23) $(0.11)
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Diluted $(0.23) $(0.11)
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Weighted average number of common and
common equivalent shares outstanding:
Basic 6,095,486 5,828,776
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Diluted 6,095,486 5,828,776
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</TABLE>
The accompanying notes are an integral part of these financial statements.
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SEEC, INC.
Condensed Consolidated Balance Sheets
<TABLE>
<CAPTION>
JUNE 30, MARCH 31,
2000 2000
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(UNAUDITED) (AUDITED *)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $19,709,963 $18,404,429
Short-term investments 4,801,534 7,797,247
Accounts receivable - trade, net 1,133,717 1,018,740
Prepaid expenses and other current assets 391,017 483,486
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Total current assets 26,036,231 27,703,902
PROPERTY AND EQUIPMENT, NET 1,095,058 1,135,299
GOODWILL AND OTHER INTANGIBLE ASSETS, NET 2,964,086 3,106,422
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$30,095,375 $31,945,623
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable - trade $ 408,162 $ 584,497
Accrued compensation 772,116 717,959
Deferred maintenance revenue 442,513 554,402
Other current liabilities 415,557 444,264
Income taxes payable 6,786 47,583
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Total current liabilities 2,045,134 2,348,705
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SHAREHOLDERS' EQUITY:
Preferred stock--no par value; 10,000,000 shares authorized;
none outstanding
Common stock--$.01 par value; 20,000,000 shares authorized; 6,309,187
shares issued at June 30, 2000 and March 31, 2000,
respectively 63,092 63,092
Additional paid-in capital 34,580,682 34,576,688
Accumulated deficit (5,539,748) (4,130,409)
Less treasury stock, at cost--221,915 and 194,115 shares
at June 30, 2000 and March 31, 2000, respectively (1,019,441) (864,521)
Accumulated other comprehensive loss (34,344) (47,932)
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Total shareholders' equity 28,050,241 29,596,918
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$30,095,375 $31,945,623
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</TABLE>
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* Condensed from audited financial statements
The accompanying notes are an integral part of these financial statements.
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SEEC, INC.
Condensed Consolidated Statements Of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended June 30,
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2000 1999
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<S> <C> <C>
Cash Flows Used by Operating Activities $(1,462,267) $ (150,834)
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment, net of disposals (47,025) (36,425)
Purchases of short-term investments (36,452) (341,528)
Sales of short-term investments 3,001,434 2,000,000
Other, net 1,628 (26,765)
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Net cash provided by investing activities 2,919,585 1,595,282
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CASH FLOWS FROM FINANCING ACTIVITIES:
Purchases of treasury stock (162,484) --
Proceeds from exercise of stock options 10,700 298
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Net cash provided (used) by financing activities (151,784) 298
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NET INCREASE IN CASH AND CASH EQUIVALENTS 1,305,534 1,444,746
Cash and cash equivalents, beginning of period 18,404,429 22,448,176
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CASH AND CASH EQUIVALENTS, END OF PERIOD $19,709,963 $23,892,922
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</TABLE>
The accompanying notes are an integral part of these financial statements.
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SEEC, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements include the
accounts of SEEC, Inc., its wholly-owned subsidiaries, and its unincorporated
branch operations (collectively the "Company" or "SEEC"). Management believes
that all adjustments, consisting only of normal recurring adjustments,
considered necessary for a fair statement of results have been included in the
consolidated financial statements for the interim periods presented. All
significant intercompany accounts and transactions have been eliminated. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements, and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. Operating results for interim
periods are not necessarily indicative of results that may be expected for an
entire fiscal year. Accordingly, these interim period consolidated financial
statements should be read in conjunction with the consolidated financial
statements contained in the Company's Annual Report on Form 10-K for the fiscal
year ended March 31, 2000.
Certain prior period amounts have been reclassified to conform to
current period classifications.
2. REVENUE RECOGNITION
The Company recognizes revenue in accordance with the American Institute of
Certified Public Accountants' Statements of Position ("SOP") 97-2, "Software
Revenue Recognition," and SOP 98-9, "Software Revenue Recognition, With Respect
to Certain Arrangements." SOP 97-2 specifies the criteria that must be met for
recognizing revenues from software sales, and SOP 98-9 requires recognition of
revenue using the "residual method" in a multiple-element arrangement when fair
value does not exist for one or more of the delivered elements in the
arrangement. Under the residual method, the total fair value of the undelivered
elements is deferred and subsequently recognized in accordance with SOP 97-2.
Revenues are derived from the license of software products, customer
support and maintenance contracts, and services contracts, including consulting
and training services. Revenues from product license fees are recognized when an
order or agreement is in hand, the fee is fixed and determinable, and delivery
of the product has occurred. Customer support and maintenance contract revenues
are recognized ratably over the term of the related agreement, generally twelve
months. The Company provides professional services under time-and-materials and
fixed-price contracts. Revenues from time-and-materials contracts are recognized
as the services are provided. Revenues from fixed-price contracts are recognized
on achievement of specified performance milestones negotiated with customers.
This method, which recognizes revenues on substantially the same basis as the
percentage-of-completion method, is used because management considers milestones
to be the best available measure of progress. Provision for estimated losses on
uncompleted contracts is made in the period in which such losses are
determinable.
3. STOCK REPURCHASE PROGRAM
In July 1998, the Company announced its plan to begin a stock repurchase
program, utilizing up to $3 million to buy shares of the Company's Common Stock
from time to time on the open market, subject to market conditions and other
relevant factors. The Company may use repurchased shares to cover stock option
exercises, employee stock purchase plan transactions, and for other corporate
purposes. Through June 30, 2000, the Company had used $1.6 million to repurchase
343,500 shares, of which 121,585 shares were reissued to cover Employee Stock
Purchase Plan transactions, stock option exercises, and stock warrant exercises.
Repurchased shares are recorded as treasury shares.
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4. EARNINGS PER SHARE
Earnings per share ("EPS") for all periods presented is computed in
accordance with the provisions of Statement of Financial Accounting Standards
No. 128, "Earnings Per Share". All options and warrants are excluded from the
computation of net loss per share of Common Stock for the quarters ended June
30, 2000 and 1999 because their effect is not dilutive.
5. COMPREHENSIVE INCOME
Comprehensive income (loss) includes all changes in equity during a period,
except those resulting from investments by owners and distributions to owners.
The Company reports comprehensive income and its components in its annual
Consolidated Statement of Changes in Shareholders' Equity. The components of the
Company's comprehensive income (loss) were as follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
JUNE 30,
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2000 1999
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<S> <C> <C>
Net loss $(1,408,481) $(663,573)
Unrealized gain (loss) on investments, net of taxes 13,588 (35,401)
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Total comprehensive loss $(1,394,893) $(698,974)
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</TABLE>
6. INCOME TAXES
In the quarter ended June 30, 2000, the Company calculated a deferred tax
asset, which was offset by a valuation allowance due to the uncertainty of
realization of the Company's net operating loss carryforwards, resulting in no
tax provision or benefit accrued in the quarter. In the quarter ended June 30,
1999, a valuation allowance partially offset the deferred tax asset, resulting
in a tax benefit with an effective tax rate of 13%. As of March 31, 2000, the
Company had unused Federal and state net operating loss carryforwards that may
be applied to reduce future taxable income of approximately $4,358,000 and
$5,633,000, respectively. The carryforwards expire at various times from March
31, 2006 to March 31, 2015. Certain changes in ownership could result in an
annual limitation on the amount of carryforwards that may be utilized.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Part I, Item 2 of this report should be read in conjunction with Part II,
Item 7 of SEEC's Annual Report on Form 10-K for the year ended March 31, 2000.
The information contained herein is not a comprehensive management overview and
analysis of the financial condition and results of operations of SEEC, but
rather an update of disclosures made in the aforementioned filing. Certain
information contained herein should be considered "forward-looking information,"
which is subject to a number of risks and uncertainties. The preparation of
forward-looking information requires the use of estimates of future revenues,
expenses, activity levels and economic and market conditions, many of which are
outside our control. Other factors and assumptions are involved in the
preparation of forward-looking information, and the failure of any such factors
and assumptions to be realized may cause actual results to differ materially
from those discussed. We assume no obligation to update such estimates to
reflect actual results, changes in assumptions or changes in other factors
affecting such estimates.
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OVERVIEW
SEEC, Inc. (the "Company" or "SEEC") offers an integrated solution for
transforming legacy assets via Web-enablement, legacy application integration,
and componentization. Most large organizations have vast amounts of data stored
on legacy mainframe systems that until recently could be accessed only through
"green screen" terminals. These organizations increasingly need to gain or
provide access to this data through the Internet or intranets via more
user-friendly methods and interfaces. We provide enterprise solutions for
enhancing and renewing legacy systems and for migrating or integrating them with
newer systems--allowing for disparate systems within an enterprise to
communicate with each other. Our solutions include flexible methodologies,
proven tools, and expert consulting services that have been utilized extensively
by Fortune 1000 companies and similarly-sized organizations and several leading
international information technology ("IT") service providers. Our products and
solutions are used for legacy system transformation for Web-enablement,
application integration and migration, and componentization.
We derive our revenues from software license and maintenance fees and
professional services fees. Our software is licensed primarily to Fortune 1000
companies, governmental organizations and third-party service providers.
Professional services are provided to customers in conjunction with the license
of software products. Our enterprise solutions and software products and
services are marketed through a broad range of distribution channels, including
direct sales to end users, and to end users in conjunction with our partners.
COMPARISON OF QUARTERS ENDED JUNE 30, 2000 AND 1999
The following section includes information related to changes in SEEC's
Consolidated Statements of Operations. References to the first quarter of fiscal
2001 and to the first quarter of fiscal 2000 refer to the three months ended
June 30, 2000 and June 30, 1999, respectively.
REVENUES. Total revenues for the first quarter of fiscal 2001 were
$1,075,000 compared to $2,004,000 for the first quarter of fiscal 2000, a
decrease of $929,000 or 46%. The decrease resulted from a decline in the demand
for year 2000 solutions, as market demand and our offerings shifted from year
2000 solutions to Web-enablement and legacy system transformation solutions
(collectively, "e-business" solutions). Revenues from e-business solutions
accounted for substantially all of our revenues in the first quarter of fiscal
2001. No revenues were derived from e-business solutions in the first quarter of
fiscal 2000, when year 2000 solutions accounted for 100% of our revenues.
Software license and maintenance fees were $681,000 for the first quarter
of fiscal 2001 compared to $1,219,000 for the first quarter of fiscal 2000, a
decrease of $538,000 or 44%. Professional services revenues were $394,000 for
the first quarter of fiscal 2001 compared to $784,000 for the first quarter of
fiscal 2000, a decrease of $390,000 or 50%. These decreases were primarily the
result of the decline in demand for year 2000 solutions, which was only
partially offset by revenues from e-business products and services.
COST OF REVENUES. Total cost of revenues was $445,000 for the first quarter
of fiscal 2001 compared to $675,000 for the first quarter of fiscal 2000, a
decrease of $230,000 or 34%. The decrease in total cost of revenues corresponds
to the overall decline in revenues, discussed above.
Cost of software license and maintenance fees includes the costs of
providing customer support services, royalty expenses, the cost of third-party
software sold, and, to a lesser degree, the costs of media, manuals, duplication
and shipping related to sales of certain of our software products. Customer
support is primarily telephone or online (Internet) support for customers who
have purchased maintenance in conjunction with software license purchases. Cost
of software license and maintenance fees was $113,000 for the first quarter of
fiscal 2001 compared to $184,000 for the first quarter of fiscal 2000, a
decrease of $71,000 or 39%. Costs in the first quarter of fiscal 2000 included a
charge for third-party software sold, a cost not incurred in fiscal 2001.
Professional services costs consist primarily of compensation and related
benefits, and travel and equipment for Company personnel responsible for
providing consulting and training services to customers. Costs of temporary or
subcontracted labor may also be included, if such labor is required to meet the
demands of providing services. Professional services costs were $332,000 for the
first quarter of fiscal 2001 compared to $491,000 for the first quarter of
fiscal 2000, a decrease of $159,000 or 32%. The decrease in professional
services costs corresponds to the decline in professional services revenues.
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GROSS MARGINS. Total gross margin (total revenues less total cost of
revenues) as a percentage of revenues was 59% and 66% for the quarters ended
June 30, 2000 and 1999, respectively. Gross margin percentages were 83% and 85%
for software license and maintenance fees, and 16% and 37% for professional
services for the first quarters of fiscal 2001 and 2000, respectively. The gross
margin percentages for software license and maintenance fees are impacted by the
proportion of customer support services costs to the amount of software license
and maintenance fees generated in a given period. These percentages also
fluctuate depending on the mix of software products and the varying royalty
expenses, if any, associated with those products. The gross margin percentages
for professional services--product related vary depending on the utilization
rates for billable consultants, the timing and amount of costs incurred for
recruiting and training services consultants, and the type of services provided.
The gross margin percentage for the first quarter of fiscal 2001 was lower than
the gross margin percentage for fiscal 2000 due to decreased utilization rates
of our billable consultants.
GENERAL AND ADMINISTRATIVE. General and administrative expenses include the
costs of general management, finance, legal, accounting, investor relations,
office facilities and other administrative functions. General and administrative
expenses were $580,000 for the first quarter of fiscal 2001 compared to $537,000
for the first quarter of fiscal 2000, an increase of $43,000 or 8%. The increase
was primarily due to the general and administrative costs of Mozart Systems
Corporation, which was acquired in the second quarter of fiscal 2000. The
increase in expenses resulting from the Mozart acquisition was partially offset
by our efforts to reduce general expenses, including the closing of our Munich,
Germany office in the third quarter of fiscal 2000.
SALES AND MARKETING. Sales and marketing expenses consist primarily of
salaries, incentive compensation and related taxes and benefits of our sales,
sales support, and marketing personnel, plus the costs of travel, advertising,
and other promotional activities. Sales and marketing expenses were $1,185,000
for the first quarter of fiscal 2001 compared to $1,513,000 for the first
quarter of fiscal 2000, a decrease of $328,000 or 22%. In the first quarter of
fiscal 2000, we incurred higher expenses for advertising and promotion in
conjunction with the launch of our e-business solutions. In addition, we
restructured our worldwide sales organization in the fourth quarter of fiscal
2000, resulting in cost reductions that are reflected in the first quarter of
fiscal 2001.
RESEARCH AND DEVELOPMENT. Total expenditures for research and development
were $474,000 for the first quarter of fiscal 2001, compared to $382,000 for the
first quarter of fiscal 2000, an increase of $92,000 or 24%. This increase is
due primarily to the added research and development personnel and related
expenses in connection with the acquisition of Mozart.
AMORTIZATION OF GOODWILL AND OTHER INTANGIBLE ASSETS. Goodwill and other
intangible assets are amortized over their estimated useful lives of five to
seven years. In the first quarter of fiscal 2001, amortization of goodwill and
other intangible assets amounted to $141,000 compared to $36,000 for the first
quarter of fiscal 2000, an increase of $105,000 or 292%. The increase was due to
amortization of intangible assets acquired in the acquisition of Mozart.
NET INTEREST INCOME. Net interest income consists principally of interest
income on cash equivalents and short-term investments, comprised primarily of
money market funds and high-grade bonds and bond funds with average maturities
of less than two years. Net interest income was $341,000 for the first quarter
of fiscal 2001 compared to $376,000 for the first quarter of fiscal 2000, a
decrease of $35,000 or 9%. The decrease from the first quarter of fiscal 2000 to
the first quarter of fiscal 2001 was due primarily to decreased cash balances
resulting from the use of cash for the Mozart acquisition, to fund operations,
and for stock repurchases. The negative effect of the reduced cash balances on
interest income was partially offset by the positive impact of higher interest
rates earned on cash equivalents and short-term investments.
INCOME TAXES. In the respective first quarters, the Company calculated a
net deferred tax asset, which was fully offset in fiscal 2001 and partially
offset in fiscal 2000 by a valuation allowance, due to the uncertainty of
realization of our net operating loss carryforwards. As a result, no provision
for income taxes was recorded in the first quarter of fiscal 2001. An income tax
benefit of ($100,000) was recorded in the first quarter of fiscal 2000. At March
31, 2000, the Company had unused Federal and state net operating loss
carryforwards that may be applied to reduce future taxable income of
approximately $4,358,000 and $5,633,000, respectively. The
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carryforwards expire at various times from March 31, 2006 to March 31, 2015.
Certain changes in SEEC's ownership could result in an annual limitation on the
amount of carryforwards that may be utilized.
LIQUIDITY AND CAPITAL RESOURCES
We have funded our operations primarily through sales of equity securities
and through cash flows from operations. In fiscal 1997, we sold 211,425 shares
of Common Stock in a private placement for $747,000, and sold 2,070,000 shares
of Common Stock in an initial public offering, the net proceeds of which were
$13.0 million. In fiscal 1998, we sold 1,030,000 shares of Common Stock in a
secondary public offering, the net proceeds of which were $19.1 million.
At June 30, 2000, we had cash, cash equivalents, and short-term investments
of $24.5 million and working capital of $24.0 million. Excess cash has been
invested, and we expect that it will continue to be invested, in
interest-bearing investment grade securities and money market funds. Cash has
been used primarily to fund general operations, including ongoing research and
development, to purchase property and equipment, to fund two acquisitions, and
to purchase Company Common Stock under the Stock Repurchase Program described in
Note 3 to the Unaudited Consolidated Financial Statements. We used $1.5 million
for operating activities in the three months ended June 30, 2000, compared to
$151,000 used for operating activities in the three months ended June 30, 1999.
We used $47,000 and $36,000 to purchase property and equipment, net of proceeds
from disposals, in the three months ended June 30, 2000 and 1999, respectively.
We generated $3.0 million in cash and cash equivalents from sales of short-term
investments, net of purchases, in the three months ended June 30, 2000, compared
to $1.7 million in generated in the three months ended June 30, 1999. We used
$162,000 for stock repurchases in the three months ended June 30, 2000.
Our cash balances may be used to broaden international sales and marketing
efforts, to expand domestic sales and marketing efforts, to establish additional
facilities, to hire additional personnel, to increase research and development,
for capital expenditures and for working capital and other general corporate
purposes. We may also utilize cash to develop or acquire other businesses,
products or technologies complementary to our current business. The amounts
actually expended for each such purpose may vary significantly and are subject
to change at management's discretion, depending upon certain factors, including
economic or industry conditions, changes in the competitive environment and
strategic opportunities that may arise. Management believes that cash flows from
operations and the current cash balances will be sufficient to meet our
liquidity needs for the foreseeable future. In the longer term, we may require
additional sources of capital to fund future growth. Such sources of capital may
include additional equity offerings or debt financings.
SEASONALITY
Our operations are not affected by seasonal factors. Our cash flows may at
times fluctuate due to the timing of cash receipts from large individual sales.
FOREIGN CURRENCY
The overall effects of foreign currency exchange rates on our business
during the periods discussed have not been material. Movements in foreign
currency exchange rates create a degree of risk to our operations if those
movements affect the dollar value of costs incurred in foreign currencies. The
majority of our billings to date have been denominated in U.S. dollars. Changing
currency exchange rates may affect our competitive position if exchange rate
changes impact profitability and business and/or pricing strategies of foreign
competitors. Specific currencies that impact us are the British Pound Sterling,
Indian Rupee, German Deutschmark, Korean Won, and the Singapore Dollar.
The functional currency of our subsidiaries and branch operations is the
U.S. dollar. Monetary assets and liabilities of these subsidiaries and branches
are remeasured at the current exchange rate at the balance sheet date, and
non-monetary items are translated at historical rates. Revenues and expenses are
translated using the average exchange rate during the period.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Interest Rate Risk. Our exposure to market rate risk for changes in
interest rates relates primarily to our cash equivalent investments. We have not
used derivative financial instruments. We invest our excess cash in short-term,
floating-rate instruments that carry a degree of interest rate risk. These
instruments may produce less income than expected if interest rates fall.
Conversely, if interest rates rise, the market value of our fixed-income
investments will likely be negatively impacted.
Foreign Currency Risk. Our international business is subject to risks
typical of an international business including, but not limited to, differing
economic conditions, changes in political climate, differing tax structures,
other regulations and restrictions, and foreign exchange rate volatility.
Accordingly, our future results could be materially and adversely impacted by
changes in these or other factors. We are exposed to foreign currency exchange
rate fluctuations as the financial results of our foreign subsidiaries are
translated into U.S. dollars in consolidation. As exchange rates vary, these
results, when translated, may vary from expectations and adversely impact
overall profitability. The effect of foreign exchange rate fluctuations on us
has not been material.
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PART II--OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS--NOT APPLICABLE
ITEM 2. CHANGES IN SECURITIES--NOT APPLICABLE
ITEM 3. DEFAULTS UPON SENIOR SECURITIES--NOT APPLICABLE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS--NOT APPLICABLE
ITEM 5. OTHER INFORMATION--NOT APPLICABLE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS:
The Exhibits listed below are filed or incorporated by reference as part of
this Form 10-Q.
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
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<S> <C>
2.1 (5) Agreement and Plan of Merger dated July 16, 1999 between the Registrant and
Mozart Systems Corporation.
3.1 (1) The Registrant's Amended and Restated Articles of
Incorporation.
3.2 (1) The Registrant's Amended and Restated Bylaws.
10.1 (1) SEEC, Inc. 1994 Stock Option Plan.
10.2 (1) Registration Rights Agreement dated as of August 15, 1996
among the Registrant and certain of its shareholders.
10.3 (1) Agreement dated July 16, 1996 between the Registrant and Raj
Reddy.
10.4 (2) SEEC, Inc. 1997 Stock Option Plan.
10.5 (4) Asset Purchase Agreement dated August 7, 1998, between the
Registrant and ERA.
10.6 (3) SEEC, Inc. 1998 Employee Stock Purchase Plan.
10.7 (5) Employment Agreement dated August 3, 1999 between Mozart Systems Corporation and Alan
P. Parnass.
10.8 (5) Non-Competition Agreement dated August 3, 1999 between Mozart Systems Corporation and
Alan P. and Kim I. Parnass.
10.9 (6) Agreement and Release dated March 7, 2000 between the Registrant and Allen Gart.
10.10 (6) Employment Agreement dated March 10, 2000 between the Registrant and Ravindra Koka.
10.11 (6) Employment Agreement dated March 10, 2000 between the Registrant and John D. Godfrey.
10.12 (6) Employment Agreement dated March 10, 2000 between the Registrant and Richard J.
Goldbach.
21.1 (6) Subsidiaries of the Company.
27 Financial Data Schedule.
</TABLE>
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(1) Incorporated by reference to Exhibits to the Company's Registration
Statement on Form S-1, File No. 333-14027.
(2) Incorporated by reference to Exhibits to the Company's Annual Report on
Form 10-K for the fiscal year ended March 31, 1997, File No. 0-21985.
(3) Incorporated by reference to the Company's Registration Statement on
Form S-8, File No. 333-62149.
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<PAGE> 13
(4) Incorporated by reference to Exhibits to the Company's Annual Report on
Form 10-K for the fiscal year ended March 31, 1999, File No. 0-21985.
(5) Incorporated by reference to the Company's Report on Form 8-K dated
August 4, 1999, File No. 0-21985.
(6) Incorporated by reference to Exhibits to the Company's Report on Form 10-K
for the fiscal year ended March 31, 2000, File No. 0-21985.
(B) REPORTS ON FORM 8-K:
No reports on Form 8-K were filed during the quarter ended June 30, 2000.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused the report to be signed on its behalf by the
undersigned thereunto duly authorized.
SEEC, Inc.
(Registrant)
Date: August 14, 2000
By: /s/ RAVINDRA KOKA
-----------------------------------------------
Ravindra Koka
President, Chief Executive Officer and Director
By: /s/ RICHARD J. GOLDBACH
-----------------------------------------------
Richard J. Goldbach
Treasurer and Chief Financial Officer
13
