SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 31, 2001
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Commission File No. 001-12392
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NATIONAL DATA CORPORATION
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(Exact name of registrant as specified in its charter)
DELAWARE 58-0977458
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(State or other jurisdiction of (IRS Employer
incorporation) Identification Number)
National Data Plaza, Atlanta, Georgia 30329-2010
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (404) 728-2000
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N/A
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(Former name, former address and former fiscal year, if
changed since last year)
Item 2. Acquisition or Disposition of Assets
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National Data Corporation completed the spin-off of our Global Payments
Inc. subsidiary ("Global Payments") on January 31, 2001 by distributing all of
the shares of common stock, no par value, of Global Payments outstanding on the
record date of January 19, 2001, consisting of 26,430,192 shares, to NDC
stockholders. Stockholders received 0.8 share of Global Payments common stock
for each share of NDC common stock held as of the record date of January 19,
2001.
In connection with the spin-off, we entered into a distribution
agreement with Global Payments which details, among other things, the principal
corporate transactions required to effect the spin-off and certain other
agreements relating to the future relationship between NDC and Global Payments.
These other agreements include a tax sharing and indemnification agreement, an
employee benefits agreement, a transition support agreement, an intercompany
systems/network services agreement, a services agreement (batch processing), a
headquarters lease agreement, and two sublease agreements. These agreements are
filed as exhibits to this report.
As outlined in the distribution agreement, Global Payments paid us an
estimated initial cash dividend of approximately $62.5 million at the time of
the spin-off. We utilized this dividend to pay the outstanding balance under our
then existing line of credit. Additionally, all existing intercompany loans or
advances between NDC and Global Payments were settled or terminated at the time
of the spin-off.
No consideration was payable by NDC stockholders for the shares of
Global Payments Inc. common stock they received in the spin-off nor were they
required to surrender or exchange shares of NDC common stock or take any other
action in order to receive the Global Payments Inc. shares.
Additional information concerning NDC, the distribution and Global
Payments is contained in our Current Report on Form 8-K filed on December 20,
2000, our Quarterly Report on Form 10-Q for the quarter ended November 30, 2000,
and Global Payments' Registration Statement on Form 10 that was declared
effective by the Securities and Exchange Commission on January 2, 2001 (File
No. 1-16111), under the Securities Exchange Act of 1934, as amended.
Item 7. Financial Statements and Exhibits
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(b) Pro Forma Financial Information
The following unaudited pro forma consolidated financial statements
present pro forma financial information for NDC giving effect to the spin-off of
Global Payments Inc. and the related transactions. The unaudited consolidated
balance sheet as of November 30, 2000 is presented as if the spin-off had
occurred as of that date. The unaudited pro forma consolidated income statements
for the six month period ended
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November 30, 2000 and for the fiscal year ended May 31, 2000 are presented as if
the spin-off had occurred at the beginning of the earliest period presented.
The pro forma consolidated financial statements should be read in
conjunction with the unaudited consolidated financial statements and notes
included in our Quarterly Report on Form 10-Q for the quarter ended November 30,
2000 and the audited consolidated financial statements and notes included in our
Annual Report on Form 10-K for the fiscal year ended May 31, 2000. The pro
forma information may not necessarily be indicative of what our results of
operations or financial position would have been had the spin-off and related
transactions been in effect for and as of the periods presented, nor is such
information necessarily indicative of our results of operations or financial
position for or as of any future period or date.
For fiscal 2000, our Management Services business, which was divested
in August 2000, as well as the Global Payments business, were classified as
discontinued operations.
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PRO FORMA CONSOLIDATED BALANCE SHEETS
NDCHealth
(In thousands, except share and per share data)
- -------------------------------------------------------------------------------------------------------------------------
November 30, 2000
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Pro Forma
Adjustments
Historical (A) Pro Forma
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ASSETS
Current assets:
Cash and cash equivalents $ 7,286 $ 5,500 $ 12,786
Accounts receivable 61,648 - 61,648
Allowance for doubtful accounts (6,243) - (6,243)
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Accounts receivable, net 55,405 - 55,405
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Income tax receivable 28,867 - 28,867
Deferred income taxes 298 - 298
Prepaid expenses and other current assets 17,275 - 17,275
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Total current assets 109,131 5,500 114,631
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Property and equipment, net 79,130 - 79,130
Intangible assets, net 217,275 - 217,275
Deferred income taxes 15,565 - 15,565
Investments 36,322 - 36,322
Other 9,539 - 9,539
Net assets of discontinued operations 205,702 (205,702) -
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Total Assets $672,664 $(200,202) $ 472,462
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Line of credit $ 57,000 $ (57,000) $ -
Current portion of long-term debt 164 - 164
Obligations under capital leases 5,362 - 5,362
Accounts payable and accrued liabilities 57,183 - 57,183
Accrued spinoff related liabilities 10,819 - 10,819
Deferred income 23,899 - 23,899
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Total current liabilities 154,427 (57,000) 97,427
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Long-term debt 152,425 - 152,425
Obligations under capital leases 1,607 - 1,607
Other long-term liabilities 15,016 - 15,016
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Total liabilities 323,475 (57,000) 266,475
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Commitments and contingencies
Shareholders' equity:
Preferred stock, par value $1.00 per share;
1,000,000 shares authorized, none issued - - -
Common stock, par value $.125 per share; 200,000,000
shares authorized; 33,953,008 shares issued 4,244 - 4,244
Capital in excess of par value 348,174 (143,202) 204,972
Treasury stock, at cost, 1,019,859 shares (26,897) - (26,897)
Retained earnings 38,375 - 38,375
Deferred compensation (6,798) - (6,798)
Unrealized holding loss (4,264) - (4,264)
Cumulative translation adjustment (3,645) - (3,645)
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Total shareholders' equity 349,189 (143,202) 205,987
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Total Liabilities and Shareholders' Equity $672,664 $(200,202) $ 472,462
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PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
NDCHealth
(In thousands, except per share data)
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Six Months Ended November 30, 2000
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Pro Forma
Historical Adjustments (A) Pro Forma
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Revenues $169,540 $ - $169,540
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Operating expenses:
Cost of service 99,871 - 99,871
Sales, general and administrative 40,546 - 40,546
Restructuring and impairment charges 2,156 - 2,156
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142,573 - 142,573
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Operating income 26,967 - 26,967
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Other income (expense):
Interest and other income 30 - 30
Interest and other expense (3,753) - (3,753)
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(3,723) - (3,723)
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Income before income taxes and
discontinued operations 23,244 - 23,244
Provision for income taxes 9,024 - 9,024
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Income before discontinued operations 14,220 - 14,220
Discontinued operations, net of tax 8,323 (8,323) -
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Net income $ 22,543 $(8,323) $ 14,220
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Basic earnings per
share:
Income before discontinued operations $ 0.43 $ - $ 0.43
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Discontinued operations, net of tax $ 0.25 $ (0.25) $ -
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Basic earnings per share $ 0.69 $ (0.25) $ 0.43
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Diluted earnings per share:
Income before discontinued operations $ 0.42 $ - $ 0.42
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Discontinued operations, net of tax $ 0.25 $ (0.25) $ -
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Diluted earnings per share $ 0.67 $ (0.25) $ 0.42
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Average shares outstanding
Basic 32,825 32,825 32,825
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Diluted 33,741 33,741 33,741
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PRO FORMA CONSOLIDATED STATEMENTS OF INCOME (LOSS)
NDCHealth
(In thousands, except per share data
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended May 31, 2000
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Pro Forma
Historical Adjustments (A) Pro Forma
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Revenues $345,673 $ - $345,673
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Operating expenses:
Cost of service 157,738 - 157,738
Sales, general and administrative 141,159 - 141,159
Non-recurring, restructuring and
impairment charges 34,393 - 34,393
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333,290 - 333,290
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Operating income 12,383 - 12,383
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Other income (expense):
Interest and other income 4,549 - 4,549
Interest and other expense (16,270) - (16,270)
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(11,721) - (11,721)
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Income before income taxes and discontinued operations 662 - 662
Provision for income taxes 1,825 - 1,825
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Income (loss) before discontinued operations (1,163) - (1,163)
Discontinued operations including cumulative change in
accounting principle of $(13,760) in 2000, net of
income taxes (39,002) (33,047) (72,049)
- ---------------------------------------------------------------------------------------------------------------------------
Net income (loss) $(40,165) $(33,047) $(73,212)
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Basic earnings (loss) per share:
Income (loss) before discontinued operations $ (0.03) $ - $ (0.03)
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Discontinued operations, net of tax $ (1.17) $ (0.99) $ (2.17)
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Basic earnings (loss) per share $ (1.21) $ (0.99) $ (2.20)
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Diluted earnings (loss) per share:
Income (loss) before discontinued operations $ (0.03) $ - $ (0.03)
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Discontinued operations, net of tax $ (1.17) $ (0.99) $ (2.17)
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Diluted earnings (loss) per share $ (1.21) $ (0.99) $ (2.20)
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Average shares outstanding
Basic 33,232 33,232 33,232
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Diluted 34,448 34,448 34,448
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Note to Unaudited Pro Forma Financial Information
(A) Reflects the spin-off of Global Payments Inc. including an estimated
cash dividend of approximately $62.5 million to us from Global Payments at
November 30, 2000. The pro forma adjustment to the consolidated balance sheet
as of November 30, 2000 assumes a portion of the cash dividend received from
Global Payments would be used to reduce the amount outstanding on our line of
credit. The pro forma adjustments to the consolidated income statements for the
six month period ended November 30, 2000 and for the fiscal year ended May 31,
2000 eliminate the operating results of Global Payments included in the line
items titled discontinued operations.
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(c) Exhibits
The following documents are filed as Exhibits to this Report:
2.1 Distribution Agreement, Plan of Distribution and Reorganization, dated as
of January 31, 2001 by and between National Data Corporation and Global
Payments Inc.
10.1 Tax Sharing and Indemnification Agreement, dated as of January 31, 2001 by
and between National Data Corporation and Global Payments Inc.
10.2 Employee Benefits Agreement, dated as of January 31, 2001 by and between
National Data Corporation and Global Payments Inc.
10.3 Transition Support Agreement, dated as of January 31, 2001 by and between
National Data Corporation and Global Payments Inc.
10.4 Intercompany Systems/Network Services Agreement, dated as of January 31,
2001 by and between National Data Corporation and Global Payments Inc.
10.5 Services Agreement (Batch Processing), dated as of January 31, 2001 by and
between National Data Corporation and Global Payments Inc.
10.6 Headquarters Lease Agreement, dated as of January 31, 2001 by and between
National Data Corporation and Global Payments Inc.
10.7 Sublease Agreement, dated as of January 31, 2001 by and between National
Data Corporation and Global Payments Systems LLC.
10.8 Sublease Agreement, dated as of January 31, 2001 by and between National
Data Corporation and National Data Payment Systems, Inc.
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SIGNATURE
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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.
NATIONAL DATA CORPORATION
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(Registrant)
By: /s/ David H. Shenk
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David H. Shenk
Corporate Controller
(Chief Accounting Officer)
Date: February 14, 2001
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