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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): June 1, 1999
FUNDTECH LTD.
(Exact Name of Registrants as Specified in their Charters)
ISRAEL
(State or Other Jurisdiction of Incorporation)
333-08304 N/A
(Commission File Number) (I.R.S. Employer Identification No.)
C/O FUNDTECH CORP.
30 MONTGOMERY STREET, SUITE 501
JERSEY CITY, NEW JERSEY 07302
(Address of Principal Executive Offices) (Zip Code)
(201) 946-1100
(Registrants' Telephone Number, Including Area Code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
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Item 2. Acquisition or Disposing of Assets.
Fundtech Ltd. (the "Company") hereby amends the following items,
financial statements, exhibits or other portions of its Current
Report on Form 8-K dated June 29, 1999 (the "Initial Report"), relating
to the Company's consummation of the purchase of all of the outstanding
shares of Biveroni Batschelet Partners AG ("BBP") from the shareholders
of BBP to include certain financial information omitted from the
Initial Report pursuant to Item 7(a)(4) of Form 8-K.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired.
See Exhibit 20.1 for the audited financial statements of Biveroni Batschelet
Partners AG.
(b) Pro Forma Financial Information.
The following unaudited pro forma condensed balance sheet was derived from
Fundtech's historical consolidated balance sheet and the historical balance
sheet of Biveroni Batschelet Partners AG. ("BBP") as of March 31, 1999. The
unaudited pro forma condensed statements of operations for the three month
period ended March 31, 1999 and for the year ended December 31, 1998 were
derived from Fundtech's historical consolidated statements of operations and the
historical statements of operations of "BBP" for the three month period ended
March 31, 1999 and for the year ended December 31, 1998. The unaudited pro forma
financial statements reflect the pro forma effects of the acquisitions of "BBP".
These unaudited pro forma financial statements give effect to the acquisitions
as if they had occurred on January 1, 1998 for the statements of operations and
as of March 31, 1999 for the balance sheet. The pro forma consolidated financial
statements do no purport to represent what Fundtech's results of operations or
financial position actually would have been if the acquisition had occurred on
or as of such dates and are not necessarily indicative of future operating
results or financial position. The unaudited pro forma condensed consolidated
financial statements are based upon, and should be read in conjunction with, the
historical consolidated financial statements of Fundtech Ltd., including notes
thereto, included in its annual Report on Form 10-K for the year ended December
31, 1998 and its unaudited historical interim financial statements including
notes thereto, included in its Quarterly Report on Form 10-Q for the period
ended March 31, 1999 and the audited annual historical financial statements and
the unaudited interim historical financial statements of "BBP", and the notes
thereto included in this Current Report on Form 8-K.
The acquisition of "BBP" has been accounted for using the purchase method of
accounting and on available financial information and certain estimates and
assumptions set forth in the notes to the unaudited pro forma consolidated
combined financial statements. Under the purchase method of accounting, the
purchase price is allocated to the fair value of the tangible and identifiable
intangible assets acquired and liabilities assumed. The pro forma adjustments
related to the "BBP" acquisition are based on preliminary assumptions of the
allocation of the purchase price and are subject to revision once appraisals,
evaluations and other studies of the fair value of the assets acquired and
liabilities assumed are completed. Actual purchase accounting adjustments
related to the "BBP" acquisition may differ from the pro forma adjustments
presented in this prospectus.
According to FASB 52, since the functional currency of BBP is the Swiss franc,
the historical financial statements of BBP have been translated to U.S. dollars
using the current rate method.
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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
BALANCE SHEETS AT MARCH 31, 1999
Fundtech Acquired Pro forma Pro forma
historical business adjustments combined
----------------- ------------------ ------------------ --------------
U.S. dollars in thousands
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ASSETS
CURRENT ASSETS:
Cash and cash equivalents 12,014 1,615 (10,403)(1) 3,226
Marketable securities - 940 - 940
Inventories - 10 - 10
Loan to a shareholder - 338 - 338
Trade receivables, net 12,282 633 - 12,915
Deferred income taxes - 36 - 36
Other accounts receivable 1,626 189 - 1,815
----------------- ------------------ ------------------ -----------------
Total current assets 25,922 3,761 (10,403) 19,280
----------------- ------------------ ------------------ -----------------
LONG-TERM TRADE RECEIVABLES 593 - - 593
----------------- ------------------ ------------------ -----------------
FIXED ASSETS, NET 4,740 708 - 5,448
----------------- ------------------ ------------------ -----------------
OTHER ASSETS 2,886 - 9,796(3) 12,682
----------------- ------------------ ------------------ -----------------
34,141 4,469 (607) 38,003
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LIABILITIES AND SHAREHOLDERS'
EQUITY (DEFICIENCY)
CURRENT LIABILITIES:
Trade payables 2,221 122 - 2,343
Other accounts payable and accrued expenses 4,290 3,493 - 7,783
Proposed dividend - 54 - 54
----------------- ------------------ ------------------ -----------------
Total current liabilities 6,511 3,669 - 10,180
----------------- ------------------ ------------------ -----------------
LONG-TERM LIABILITIES:
Deferred tax liabilities - 41 - 41
Other liabilities 71 - - 71
----------------- ------------------ ------------------ -----------------
71 41 - 112
----------------- ------------------ ------------------ -----------------
SHAREHOLDERS' EQUITY (DEFICIENCY):
Ordinary shares 34 540 2,414(2) (6) 2,988
Additional paid-in capital 42,358 - - 42,358
Deferred compensation (196) - - (196)
Retained earnings (accumulated deficit) (14,637) 219 (3,021)(3) (6) (17,439)
----------------- ------------------ ------------------ -----------------
Total shareholders' equity (deficiency) 27,559 759 (607) 27,711
----------------- ------------------ ------------------ -----------------
34,141 4,469 (607) 38,003
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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS FOR THE THREE-MONTH PERIOD ENDED
MARCH 31, 1999
Fundtech Acquired Pro forma Pro forma
historical business adjustments combined
---------------- ---------------- ----------------- -----------------
U.S. dollars in thousands
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Revenues 7,901 2,270 - 10,171
Cost of revenues 2,051 510 - 2,561
---------------- ---------------- ----------------- -----------------
Gross profit 5,850 1,760 - 7,610
Operating expenses:
Software development, net 2,337 404 - 2,741
Selling and marketing, net 1,095 222 - 1,317
General and administrative 748 202 288(5) 1,238
---------------- ---------------- ----------------- -----------------
Total operating expenses 4,180 828 288 5,296
Operating income 1,670 932 - 2,314
Financial income (expenses), net 124 1 (115)(4) 10
Other expenses, net - (13) - (13)
Income taxes - (247) - (247)
---------------- ---------------- ----------------- -----------------
Net income for the period 1,794 673 (403) 2,064
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Basic earnings per share 0.17 0.19
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Diluted earnings per share 0.16 0.18
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Shares used in computing:
Basic earnings per share 10,846 10,951
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Diluted earnings per share 11,554 11,659
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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED
DECEMBER 31, 1998
Fundtech Acquired Pro forma Pro forma
historical business adjustments combined
---------------- ---------------- ----------------- -----------------
U.S. dollars in thousands
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Revenues 23,132 4,600 - 27,732
Cost of revenues 6,418 1,598 - 8,016
---------------- ---------------- ----------------- -----------------
Gross profit 16,714 3,002 - 19,716
Operating expenses:
Software development, net 6,636 1,563 - 8,199
Selling and marketing, net 2,970 608 - 3,578
General and administrative 2,471 1,017 1,152(5) 4,640
In-process research and development
write-off 16,600 - - 16,600
---------------- ---------------- ----------------- -----------------
Total operating expenses 28,677 3,188 1,152 33,017
Operating loss (11,963) (186) - (13,301)
Financial income (expenses), net 571 4 (489) (4) 86
Other expenses, net - (25) - (25)
Income taxes - 26 - 26
---------------- ---------------- ----------------- -----------------
Loss for the year (11,392) (181) (1,641) (13,214)
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Basic loss per share (1.12) (1.29)
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Diluted loss per share (1.12) (1.29)
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Shares used in computing:
Basic loss per share 10,171 10,276
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Diluted loss per share 10,171 10,276
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NOTES TO UNAUDITED PRO-FORMA CONSOLIDATED
CONDENSED FINANCIAL STATEMENTS
(1) Reflects payment at the time of the closing of the acquisition in the form
of a cash consideration of $ 9,851 and other estimated acquisition expenses
of $ 552.
(2) Reflects amount of $ 2,954 for shares issued in connection with the
acquisition.
(3) The purchase price has been allocated as follows (U.S. dollars in
thousands):
In-process research and development 2,802
Goodwill 9,796
Tangible assets and liabilities of the acquired business, net 759
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13,357
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The total purchase price paid in connection with the acquisition has been
allocated in the accompanying pro forma information to the tangible and
identifiable intangible assets and liabilities of BBP based upon the
Company's estimates of their values. In connection with the allocation of
the purchase price, the pro forma combined condensed balance sheet
information included the write off of $ 2,802 thousand representing the
estimated value of the in process research and development ("R&D") of
software acquired from "BBP" for which technological feasibility has not
yet been established and for which no alternative future use exists. The
write off is not reflected in the unaudited pro forma consolidated combined
statement of earnings since pro forma adjustments are limited to those
events that are expected to have continuing impact, however it is reflected
as an increase in the accumulated deficit in the pro forma consolidated
combined balance sheet as of March 31, 1999. The allocation of the purchase
price for the acquisition is subject to revision when additional
information concerning assets and liability valuation is obtained. In the
opinion of the Company's management, the assets and liability valuations
for the acquisition will not be materially different from the pro forma
financial data presented.
(4) Reflects a pro forma adjustment in the amount of $ 489 for interest expense
from Janury 1, 1998 until the IPO date (March 13, 1998) and then a
reduction of interest income from the IPO date until December 31, 1998 and
a reduction of interest income of $ 115 from January 1, 1999 until March
31, 1999, respectively (which has been assumed to be 5.5% per annum on
loans and 4.5% per annum on investments) on $ 10,403 of loans and
investments assumed to finance the acquisition.
(5) Reflects a pro forma increase in amortization expenses associated with the
acquired goodwill of approximately $ 9,796 over its estimated useful life
of up to 8.5 years resulting from the application of purchase accounting
method (the increases were $ 1,152 and $ 288 for the year ended December
31, 1998 and for the three months ended March 31, 1999, respectively).
(6) Reflects the elimination of BBp's capital stock and retained earnings.
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(c) Exhibits
Exhibit No. Exhibit
2.1 Share Purchase Agreement, dated as of June 1, 1999, by and
among Fundtech Ltd., Biveroni Batschelet Partners AG and the
Shareholders listed on Schedule I thereto.*
2.2 Escrow Agreement, dated June 16, 1999, by and among Fundtech
Ltd., Fundtech Netherlands B.V.i.o., Dr. Marco Muller and
Jon A. Biveroni.*
20.1 Audited Financial Statements of Biveroni Batschelet Partners
AG.
23.1 Consent of Kost, Forer & Gabbay.
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* Previously filed as an exhibit to the Initial Report
The Company agrees to furnish supplementally to the Commission, upon request, a
copy of any exhibit or schedule to the Agreement not filed herewith.
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 thereunto duly authorized.
FUNDTECH LTD.
(Registrant)
By: /s/ Reuven Ben-Menachem
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Date: July 21, 1999 Reuven Ben-Menachem
Chairman and Chief Executive Officer
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EXHIBIT INDEX
Exhibit No. Exhibit
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2.1 Share Purchase Agreement, dated as of June 1, 1999,
by and among Fundtech Ltd., Biveroni Batschelet
Partners AG and the Shareholders listed on Schedule I
thereto.*
2.2 Escrow Agreement, dated June 16, 1999, by and among
Fundtech Ltd., Fundtech Netherlands B.V.i.o., Dr.
Marco Muller and Jon A. Biveroni.*
20.1 Audited Financial Statements of Biveroni Batschelet
Partners AG.
23.1 Consent of Kost, Forer & Gabbay.
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* Previously filed as an exhibit to the Initial Report
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