SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
January 27, 1999 (November 18, 1998)
MAGNITUDE INFORMATION SYSTEMS, INC. f/k/a PROFORMIX SYSTEMS, INC.
(Exact name of Registrant as specified in charter)
Delaware 33-20432-FW 75-2228828
(State or other jurisdic- (Commission (IRS Employer
tion of incorporation) File Number) Identification No.)
50 Tannery Road, Branchburg, NJ 08876
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (908) 534-6400
Item 2. Disposition of Assets
On November 18, 1998, Proformix Systems, Inc. ("Registrant") and its
approximately 98% owned subsidiary Proformix, Inc. entered into an Asset
Purchase Agreement and a Marketing and Development Agreement with 1320236
Ontario, Inc., d/b/a Office Specialty ("OS"), a publicly traded Canadian
designer, manufacturer and distributor of office furniture. Pursuant to the
agreements, OS acquires Proformix, Inc.'s hardware product line comprised of
ergonomic keyboard platform products and accessories, and all related inventory
and production tooling and warehousing assets, and all intellectual property
rights including the Proformix name. This sale represents a large portion of
Proformix, Inc.'s and the Registrant's assets. In consideration for the sale and
certain ongoing support services, the Registrant will receive (i) $1,266,000 in
cash; (ii) a contingent payment of 18% of the net revenue realized by OS from
the acquired assets between the closing date and April 30, 1999; and (iii)
subsequent to April 30, 1999, an annual contingent payment calculated at 10% of
net annual revenue realized by OS from the acquired assets. Should OS not attain
target sales of $8.2 million from the acquired assets for the year ending April
30, 2000, OS shall pay the Registrant 6% of net revenue for that year. Should OS
again not meet the target sales amount ($10,660,000) from the acquired assets
for the year ending April 30, 2001, OS will not owe the Registrant any payment
and the Registrant's right to future contingent payments shall cease. Further,
OS will grant the Registrant a ten year royalty-free license to use the
Proformix name in connection with the sales and marketing of Registrant's
proprietary ergonomic software products. The Registrant will continue to market
its proprietary software under the Proformix label.
Item 5. Other Events
On December 3, 1998, the Registrant filed an amendment to its certificate
of incorporation thereby changing its name to Magnitude Information Systems,
Inc.
Item 7. Financial Statements and Exhibits
2.1 Asset Purchase Agreement among the Registrant, Proformix, Inc. and OS.
2.2 Marketing and Development Agreement among Registrant, Proformix, Inc. and
OS.
99.1 Annexed as Exhibit B are the Registrant's Pro-Forma condensed balance
sheet and statement of operations and explanatory notes, giving effect to
all material events that are directly attributable to the agreements with
OS.
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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.
PROFORMIX SYSTEMS, INC.
(Registrant)
January 22, 1999 By:s/Steven Rudnik
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Steven Rudnik, President
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