UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
For the year ended December 31, 1997
Commission File Number: 1-13424
DATA SYSTEMS NETWORK CORPORATION
(Exact name of Registrant as specified in its charter)
Michigan 38-2649874
(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
34705 West Twelve Mile Road, Suite 300
Farmington Hills, Michigan 48331
(Address of principal executive offices) (Zip Code)
Registrant's telephone no. including area code: (248) 489-8700
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Common Stock, $.01 par value Pacific Stock Exchange and
Nasdaq Stock Market's
SmallCap Market
Securities registered pursuant to Section 12(g) of the Act: None
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
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
The aggregate market value of the voting stock of the registrant held by
non-affiliates(3,196,221 shares) on March 31, 1998 was $20,176,145. For
purposes of this computation only, all executive officers, directors and
beneficial owners of more than 5% of the outstanding shares of common stock
are assumed to be affiliates.
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court.
YES X NO
Indicate the number of shares outstanding of each of the Registrant's
classes of Common Stock as of the latest practicable date: 4,859,224 shares
of Common Stock outstanding as of March 31, 1998.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's definitive Proxy Statement for the 1998 Annual
Meeting of Shareholders are incorporated by reference into Part III.
PART I
ITEM 1. BUSINESS.
Recent Developments
On February 24, 1998, Data Systems Network Corporation (the
"Company") announced that it had discovered accounting irregularities which
it believed resulted in an overstatement of certain previously released
earnings. Its independent auditors issued a letter withdrawing their report
on the audited financial statements for the years ended December 31, 1995
and 1996, and the Company's treasurer and chief financial officer resigned.
A special committee of the outside members of the Company's Board of
Directors was established to investigate the matter. Based on the
preliminary results of the investigation into this matter, the Company
anticipates that 1996 results will be restated to reduce net income by
approximately $1.5 million to $2.0 million and that 1997 earnings will also
be negatively affected, resulting in a loss. Until the investigation and
audit are completed, however, a reasonable estimate of 1997 results cannot
be made. The continued investigation of these accounting irregularities,
coupled with the subsequent resignation of the Company's independent
auditing firm on March 13, 1998, and the engagement of a new independent
auditing firm on March 25, 1998 have resulted in the inability of the new
auditors to complete their audit of the Company's financial statements and
issue the requisite report thereon in time for inclusion in this report.
Consequently, the Company is unable to include information under Items 6, 7
and 8 of this report at this time. The Company will promptly file an
amendment to this report disclosing the information required by Items 6, 7
and 8 upon the completion of audited financial statements and receipt of the
requisite report thereon.
The paragraph above contains forward-looking statements. The
Company's actual results could differ materially from the results discussed
in the forward-looking statements.
General
The Company, incorporated in Michigan in 1986, provides computer
network integration and data management services in the distributed
computing marketplace. The Company's broad array of services includes
designing, installing, and managing networks of personal computers,
workstations and mainframes linked with communications hardware and software
and peripheral equipment, selling network components, training users and
administrators of networks and providing technical, expansion and
maintenance services. Marketing efforts are directed at Fortune 1000 and
middle market corporations, state and local governments, and institutional
users such as hospitals and universities.
In November 1994, the Company completed its initial offering of
1,270,000 shares of Common Stock and 1,270,000 Redeemable Common Stock
Purchase Warrants (the "Warrants") to the public. Upon completion of the
offering, the Common Stock and the Warrants became qualified for trading on
the Nasdaq Stock Market's SmallCap Market and the Pacific Stock Exchange. In
February 1997, the Company called all of its then outstanding Warrants for
redemption as of March 10, 1997 pursuant to the Warrant Agreement, dated
October 28, 1994, setting forth the terms of the Warrants. Approximately 99%
of the Warrants were exercised on or prior to the date of redemption at a
price of $6.25 per Warrant, resulting in net proceeds of approximately
$7,300,000.
In February 1996, the Company acquired 70% of the common stock of
Unified Network Services, Inc. ("UNS"), a start-up network management
operation based in Raleigh, North Carolina for $7,000 in cash. The Company
also acquired the Network Systems Group ("NSG") of SofTech, Inc. in
September 1996 for 540,000 shares of the Company's Common Stock and $890,000
in cash. From September 1996 through December 1997, the Company has opened
in excess of 10 new locations in the eastern, mid-Atlantic, and southern
areas of the United States.
Business Strategy
The Company's primary objective is to be the principal "network
integration and management company" for business, governmental, and
institutional customers throughout the United States. To achieve its
objective, the Company intends to expand through internal growth and to
explore opportunities to acquire other businesses serving its target
markets.
During 1997, the Company has continued to make major changes to its
operations in order to reposition the Company in terms of mix of business,
type of customer, and geographical area served. In terms of mix of business,
the Company is focusing on a higher level of service-to-product revenue mix,
emphasizing those high end services, such as network management services and
products that enable the control of complex distributed computing
environments, where the Company believes it has a competitive advantage. The
Company's marketing focus has changed to include not only commercial
accounts, but also governmental accounts and the Company has expanded its
geographical coverage to include significant sales and service coverage of
the eastern United States.
In addition, the Company continues to make a substantial investment
in a remote network management facility in Raleigh, North Carolina. The
Network Center has been completed and has been operational since the first
quarter 1997. In connection with the Network Center, the Company has
developed a multi-functional software product which has been trademarked
"ENCOR" that performs remote management at a client location. The Company
also has a telephone support center located near its headquarters in
Michigan, which it intends to integrate into its remote network management
offering during 1998.
Products and Services
The Company's principal business is to provide computer network
services and products that allow companies to control their complex
distributed computing environments. Such services include the design, sale
and service of local area networks ("LANs") and wide area networks ("WANs").
The Company generates revenues by providing consulting and network
installation services, selling add-on hardware components to existing
clients and providing after-installation service and support, training
services and network management services. The Company is an authorized
dealer, reseller or integrator for the products of many major vendors,
including, but not limited to: IBM, Compaq, Sun Microsystems, Dell, Bay
Networks, Hewlett-Packard, Novell, Microsoft, Cisco, Meridian Data, 3COM,
Intel, and Oracle. The Company has developed applications for remote
network management and sells private label computer systems, primarily to
state governments. In addition, the Company provides application development
services in database development, web site and Internet development, and
imaging systems.
Resellers who meet specified qualifications receive customer
referrals and recommendations and advanced technical assistance and support
from certain manufacturers, giving the qualifying resellers a competitive
advantage over other resellers in the market. These qualifications vary
from manufacturer to manufacturer and typically include some or all of the
following components: specific training for technical personnel, specific
training for sales personnel, possession of certain advanced equipment,
ongoing training requirements, and minimum purchase targets. The process of
obtaining and maintaining these manufacturer authorizations is both time
consuming and expensive, with the cost of obtaining and maintaining a single
authorization ranging from $5,000 to approximately $250,000. These costs
include, but are not limited to, acquisition of hardware, software,
facilities and spare parts, training fees, personnel and travel expenses and
fees paid to the manufacturer for certification. Some authorizations for
which the Company has qualified are: Novell Platinum Reseller, Microsoft
Solutions Provider, and Banyan Premier Provider.
Equipment is generally sold by the Company only in conjunction with
the Company's higher margin network engineering services. These services
include design, consulting, installation and network administration for both
LANs and WANs. The Company provides turnkey implementation and support
services and, for some customers, on-site support personnel who work in
conjunction with the customer's personnel on a continuous basis.
The Company also provides on-going technical and maintenance support
through a variety of service programs tailored to fit each specific
customer's service needs and budget. These programs include a two-hour
response service for critical network components and a "guaranteed spares"
program for self-maintaining clients. Warranties provided by manufacturers
are generally passed through to the purchaser by the Company. The Company
offers no warranty separate from manufacturers' warranties.
Marketing and Customers
The Company markets its products and services through its internal
sales force. The Company has sales service personnel in the following
states: Connecticut, Florida, Georgia, Illinois, Louisiana, Massachusetts,
Michigan, New Jersey, New York, North Carolina, Ohio, Pennsylvania, and
South Carolina. The Company adds and deletes locations on the basis of
business opportunities. The Company is able to perform work outside of its
locations based upon the locations of its customers' projects. The Company
has no retail sales outlets and has no intentions of entering the retail
markets.
Marketing efforts are directed at Fortune 1000 and middle market
corporations, state and local governments, and institutional users such as
hospitals and universities. Although the Company intends to expand its
geographical coverage, current marketing efforts are generally focused on
customers located in the states in which the Company has offices.
The State of Michigan accounted for 29.6% and 23.6% of revenues in
1997 and 1996, respectively. This business resulted from the contract which
was assigned in connection with the NSG acquisition in September 1996.
Revenues in previous years from the State of Michigan were minimal.
Purchases by agencies of the State of Michigan were made pursuant to a
blanket agreement which has been extended and currently expires in September
1998. There are no assurances that this contract can be extended further or
that, if rebid, the Company will be awarded an additional contract under the
same terms and conditions. The loss of this contract would have a material
adverse affect on the Midwest region revenues, however, the Company believes
that this adverse affect would, in part, be offset by the new customer base
that has been developed in the eastern United States.
Vendors
The Company purchases the microcomputers and related products it
sells directly from certain vendors and indirectly through distributors,
such as Inacom Corporation and Ingram Micro Corporation ("Ingram Micro").
In general, the Company must be authorized by a vendor in order to sell
certain of its products, whether the products are purchased from
distributors or directly from the vendors. The Company is an authorized
reseller for microcomputers, workstations, and related products of over 50
manufacturers. Sales by the Company of products manufactured by Compaq,
Dell, Hewlett-Packard and IBM accounted for between 45% to 55% of revenues
during each of the last three fiscal years. Typically, vendor agreements
provide that the Company has been appointed, on a non-exclusive basis, as an
authorized reseller of specified products at specified locations. The
agreements generally are terminable on 30 to 90 days notice or immediately
upon the occurrence of certain events and are subject to periodic renewal.
The loss of a major manufacturer or the deterioration of the Company's
relationship with a major manufacturer could have a material adverse effect
on the Company's business as certain product offerings that are requested by
customers would not be available to the Company.
The Company determines whether to purchase products from
distributors or directly from manufacturers by surveying prices and product
availability among the manufacturers and the distributors with whom it has
contractual relationships. Distributors, which purchase products in large
quantities, often are able to offer a better price on products due to volume
discounts granted by manufacturers. The Company's contract with Ingram
Micro, through which it purchased 15.8% of its product purchases in 1997,
provides competitive pricing and inventory and asset management terms and
conditions. While the loss of all of the Company's relationships with
distributors would result in higher product prices to the Company and
potentially reduce the Company's profit margins, the Company believes that
the loss of its relationship with any particular distributor would not have
a material adverse effect on the Company's results of operations or
financial condition due to the availability of other sources of supply. As
is customary in the industry, the Company does not have any long-term
agreements or commitments, because competitive sources of supply are
generally available for such products.
During 1997, the Company has signed an agreement with Ingram Micro
to provide remote network management services to Ingram Micro's Ingram
Systems Group ("ISG"). The ISG is a group of companies which represent the
top 40 customers of Ingram Micro and who do not have the capabilities or
capacities to provide their customers with the high-end services such as
remote network management. Though no significant revenues have yet been
recorded, the Company believes that this alliance will provide important
business opportunities in the future.
Competition
The network integration market is highly competitive. The Company
competes with different classes of competitors, depending on the type of
business opportunity. For project-oriented sales, the Company competes with
system integrators and with computer hardware manufacturers. The Company
also competes with a wide variety of local, regional and national hardware
resellers for add-on equipment sales. Because the Company is not as price-
aggressive as some of these competitors, the Company relies on its sales
force to provide superior servicing and post-sale technical support to
maintain its customer relationships. Depending on the customer, the Company
competes on the basis of technological capability, price, breadth of product
offerings and quality of service. Competitors also vary project to project
depending upon the geographic location of the work to be performed.
Although many of its competitors are larger and have significantly
greater financial, marketing and human resources and geographic coverage
than the Company, the Company believes that it can compete effectively
against these competitors on the basis of its extensive experience in the
network integration and management market, authorization to sell a broad
range of products and established infrastructure.
Historically, manufacturers, which generally target customers
desiring products from only the particular manufacturer, and computer retail
chains, which focus principally on product sales, have not consistently
served the Company's market component. The entry of such competitors into
the Company's market component could have a material adverse effect on the
Company.
Employees
As of December 31, 1997, the Company employed approximately 285
persons, 71 of whom were sales personnel, 160 of whom were service personnel
and the remainder of whom were administrative or management personnel. The
Company's employees have no union affiliations and the Company believes its
relationship with its employees is good.
ITEM 2. PROPERTIES.
The Company's corporate headquarters are located in Farmington
Hills, Michigan, in a leased facility consisting of approximately 11,800
square feet of office space under a lease expiring in November 2002, for
rent totaling $18,600 per month. The Company also leases two technical
facilities. One is located in Farmington Hills, Michigan, of approximately
7,000 square feet under a lease expiring in March 2003 for rent totaling
$3,900 per month. The other is located in Raleigh, North Carolina of
approximately 27,300 square feet under a lease expiring October 2001 for
rent totaling $18,300 per month. The Company's telephone help center and
other related operations are located in Grand Rapids, Michigan, under a
lease assumed in the NSG acquisition. This facility is approximately 14,000
square feet with net rent totaling $15,500 per month, expiring in April
1998. These facilities are scheduled to be downsized and a new location for
these operations is currently under review.
Additionally, the Company leases direct sales offices totaling
approximately 29,000 square feet with lease terms of one to five years, in
18 locations in the United States. The Company believes that its existing
facilities and offices and additional space available to it are adequate to
meet its requirements for its present and reasonably foreseeable needs.
ITEM 3. LEGAL PROCEEDINGS.
On or about February 26, 1998, Plaintiff Tony DiFatta filed civil
action, Case No. 98CV70854 DT (the "DiFatta Complaint"), in the United
States District Court for the Eastern District of Michigan, Southern
Division, against the Company and individual defendants Michael W. Grieves
and Philip M. Goy. Mr. DiFatta seeks to represent a class of all purchasers
of the Company's stock on the open market between March 5, 1997 and February
24, 1998, excluding the individual defendants and any officer, director or
control person of the Company and members of their immediate families. The
DiFatta Complaint alleges violation of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, 15 U.S.C. Sections 78j(b) and 78t(a), and SEC
Rule 10b-5, by means of a scheme to defraud or deceive purchasers of the
Company's common stock through nondisclosure and misrepresentations of
information concerning the Company's financial results and future prospects.
In particular, DiFatta claims that press releases and SEC filings by the
Company were materially false and misleading in that they overstated
revenues and earnings for the year and quarter ended December 31, 1996, and
for the quarters ended March 31, 1997, June 30, 1997 and September 31, 1997
due to accounting irregularities.
On or about March 17, 1998, Plaintiff Jeffrey P. Emrich filed civil
action, Case No. 98CV1223 DT (the "Emrich Complaint"), in the United States
District Court for the Eastern District of Michigan, Southern Division,
against the Company and individual defendants Grieves and Goy. The Emrich
Complaint seeks to certify an essentially identical class of purchasers of
the Company's stock as the class proposed in the DiFatta Complaint, and
presents essentially identical claims.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON
EQUITY AND RELATED STOCKHOLDER MATTERS.
The Company's Common Stock is traded on the Nasdaq Stock Market's
SmallCap Market under the symbol "DSYS" and on the Pacific Stock Exchange
under the symbol "DSY". The high and low sales prices for the Common Stock
on the Nasdaq SmallCap Market during the period from January 1, 1996,
through the first quarter of 1998 are set forth in the following table.
1996 High Low
1st Quarter $3.00 $1.50
2nd Quarter $5.56 $2.00
3rd Quarter $7.25 $2.88
4th Quarter $11.88 $6.18
1997 High Low
1st Quarter $10.00 $6.88
2nd Quarter $14.00 $7.31
3rd Quarter $16.88 $10.19
4th Quarter $15.25 $8.75
1998 High Low
1st Quarter $14.25 $6.13
As of March 31, 1998 the approximate number of record holders and
beneficial owners of the Common Stock was 290, based upon securities
position listings information available to the Company and the records of
the Company's transfer agent.
The Company has never declared or paid any dividends on its capital
stock. The Company currently anticipates that all of its earnings will be
retained for development of the Company's business, and does not anticipate
paying any cash dividends in the foreseeable future. Future cash dividends,
if any, will be at the discretion of the Company's Board of Directors and
will depend upon, among other things, the Company's future earnings,
operations, capital requirements and surplus, general financial condition,
contractual restrictions, and such other factors as the Board of Directors
may deem relevant.
ITEM 6. SELECTED FINANCIAL DATA.
To be filed by amendment.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
To be filed by amendment.
ITEM 7a. QUANTITATIVE.
Not applicable.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
YEARS ENDED DECEMBER 31, 1997, 1996, AND 1995.
To be filed by amendment.
ITEM 9. CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE.
On March 13, 1998, KPMG Peat Marwick LLP ("KPMG") informed the Board
of Directors of the Company that it has resigned as the Company's
independent auditors. The reports of KPMG on the Company's financial
statements for each of the past two fiscal years were withdrawn as of
February 24, 1998. Prior to such withdrawal, such reports contained no
adverse opinion or disclaimer of opinion and were not qualified or modified
as to uncertainty, audit scope or accounting principle.
In connection with its audits for the two most recent fiscal years
and through March 13, 1998, (i) there were no disagreements between the
Company and KPMG on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure, which
disagreements if not resolved to the satisfaction of KPMG would have caused
them to make reference thereto in their report on the financial statements
for such fiscal years and (ii) there were no reportable events as defined in
Regulation S-K Item 304(a)(1)(v), except as follows:
- As announced on February 24, 1998, the Company and KPMG
became aware of certain accounting irregularities which may
have affected previously issued financial statements.
Contemporaneously, KPMG advised the Company that its
auditor's report on the Company's consolidated financial
statements as of December 31, 1996 and 1995 and for each of
the years in the two-year period ended December 31, 1996
should no longer be relied upon. A special committee of the
outside members of the Company's Board of Directors was
established to investigate the matter. In KPMG's March 13,
1998 letter of resignation, it advised the Board of
Directors of the Company that it had concluded that it could
no longer rely on management's representations, and that it
was unwilling to be associated with the financial statements
prepared by management.
- KPMG previously communicated to the Company two items which
it considered to be material weaknesses in internal control
relating to the Company's new accounting system and the
timeliness, accuracy and availability of reconciliations,
schedules and other supporting documentation. These items
were subsequently discussed with the Audit Committee of the
Board of Directors.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The information required by this item is incorporated by reference
from the Company's definitive proxy statement relating to its 1998 annual
meeting of shareholders (the "1998 Proxy") under the headings "Election of
Directors" and "Section 16(9) Beneficial Ownership Reporting Compliance".
ITEM 11. EXECUTIVE COMPENSATION.
The information required by this item is incorporated by reference
from the 1998 Proxy under the heading "Executive Compensation" (excluding
the Report of the Executive Compensation Committee and the Stock Performance
Graph).
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The information required by this item is incorporated by reference
from the 1998 Proxy under the heading "Securities Ownership of Principal
Shareholders and Management".
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The information required by this item is incorporated by reference
from the 1998 Proxy under the heading "Certain Transactions".PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
(a) Financial Statements, Financial Statement Schedules and
Exhibits.
(1) The financial statements required by Item 8 of this
report will be filed by amendment.
(2) The following financial statement schedule of the
Company will be filed by amendment.
Schedule II Valuation and Qualifying Accounts
(3) A list of the exhibits required to be filed as part
of this Form 10-K is included under the heading "Exhibit Index" in this Form
10-K and incorporated herein by reference. Included in such list as Item
10.3 (1994 Stock Option Plan) are the Company's management contracts and
compensatory plans and arrangements which are required to be filed as
exhibits to this Form 10-K.
(b) Reports on Form 8-K.
There were no Form 8-K filings in the fourth quarter of 1997.
However, the following filings occurred in the first quarter of 1998:
Date Information Reported
February 24, 1998 Items 5 and 7
March 19, 1998 Items 4 and 7
March 31, 1998 Items 4, 5, and 7
No financial statements were filed with Reports on Form 8-K.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
DATA SYSTEMS NETWORK CORPORATION
By: Michael W. Grieves
Michael W. Grieves
Chairman, President and Chief Executive
Officer
Dated April 15, 1998
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities indicated as of April 14, 1998.
Michael W. Grieves
Michael W. Grieves
Chairman of the Board, President,
Chief Executive Officer and Director (Principal Executive Officer,
Principal Financial Officer and Principal Accounting Officer)
Richard R. Burkhart*
Richard R. Burkhart
Director and Assistant Treasurer
Walter J. Aspatore*
Walter J. Aspatore
Director
Jerry A. Dusa*
Jerry A. Dusa
Director
*By: Michael W. Grieves
Michael W. Grieves
Attorney-in-Fact
EXHIBIT INDEX
Exhibit No. Description of Exhibits
2.2 Asset Purchase Agreement, dated September 12, 1996, by and
among the Company, Information Decisions, Inc., System
Constructs, Inc. and SofTech, Inc. Schedules to the
Agreement, listed on pp. iii-iv of the Table of Contents of
the Agreement, were not filed, but will be provided to the
Commission supplementally upon request.(5)
4.5 Form of Warrant issued to former unsecured creditors
pursuant to Third Amended Plan of Reorganization*
10.1 Compaq Computer Corporation Authorized Dealer Agreement.(1)
10.3(a) Form of non-qualified stock option agreement under 1994
Stock Option Plan.(3)
10.3(c) 1994 Stock Option Plan, as amended and restated April
1997.(8)
10.3(d) Form of non-qualified stock option agreement under 1994
Stock Option Plan (April 1997 version).(8)
10.4(b) Restated Business Financing Agreement - NBD Secured Credit
Agreement, dated November 27, 1996.(5)
10.4(c) Amendment to NBD Credit Facility Agreement, dated April 23,
1997.(7)
10.4(d) NBD Bank Credit Agreement, dated September 30, 1997.(9)
10.8 Subordinated Promissory Notes issued to Michael Grieves and
Richard Burkhart, dated May 22, 1992.(1)
10.9 Promissory Note, dated June 30, 1992, from Michael
Grieves.(1)
10.14 Shareholder Agreement, dated February 22, 1996, among the
Company and Unified Network Services.(4)
10.15 Stock Purchase Agreement, dated February 22, 1996, among the
Company and Unified Network Services.(4)
10.16 Registration Rights Agreement, dated September 12, 1996,
entered into by the Company and SofTech, Inc.(5)
10.17 Financial Consulting Agreement between the Company and H.J.
Meyers & Co., Inc. and Amendment of Representative's
Warrant, dated as of December 22, 1996.(6)
10.18 Warrant Redemption Agreement, dated January 21, 1997,
between the Company and H.J. Meyers & Co., Inc.(6)
10.19 Letter Agreement between First Colonial Securities Group,
Inc. and the Company, dated as of January 29, 1997.(6)
23.1 Consent of Plante & Moran LLP**
24.1 Power of Attorney of Walter J. Aspatore*
24.2 Power of Attorney of Richard R. Burkhart*
24.3 Power of Attorney of Jerry A. Dusa*
27 Financial Data Schedule**
- --------------------------------------------
* Filed herewith.
** To be filed by amendment.
(1) Incorporated by reference from the Company's Registration Statement
on Form S-1, No. 33-81350, as amended.
(2) Incorporated by reference from the Company's Quarterly Report on
Form 10-Q for the period ended September 30, 1994.
(3) Incorporated by reference from the Company's Annual Report on Form
10-K for the year ended December 31, 1995.
(4) Incorporated by reference from the Company's Quarterly Report on
Form 10-Q for the period ended March 31, 1996.
(5) Incorporated by reference from the Company's Quarterly Report on
Form 10-Q for the period ended September 30, 1996.
(6) Incorporated by reference from the Company's Annual Report on Form
10-K for the year ended December 31, 1996.
(7) Incorporated by reference from the Company's Quarterly Report on
Form 10-Q for the period ended March 31, 1997.
(8) Incorporated by reference from the Company's Quarterly Report on
Form 10-Q for the period ended June 30, 1997.
(9) Incorporated by reference from the Company's Quarterly Report on
Form 10-Q for the period ended September 30, 1997.