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, 1997
UNIHOLDING CORPORATION
------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 0-9833 58-1443790
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
96 Spring Street, New York, New York 10012
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 219-9496
Item 2. Acquisition or Disposition of Assets.
The registrant's wholly-owned subsidiary, Global Unilabs Clinical Trials,
Ltd., a British Virgin Islands corporation ("GUCT") entered into and closed a
Master Combination Agreement ("Agreement") dated as of January 31, 1997, with
NDA Clinical Trial Services, Inc., a Delaware corporation ("NDA") and certain
stockholders of NDA.
Prior to the Agreement, GUCT owned 100% of Unilabs Clinical Trials Limited,
a company incorporated in England and Wales ("UCT"), which principally services
European and other non-U.S. based clinical trials, and 100% of Pharmasoft S.A.,
a Switzerland corporation ("Pharmasoft"), which performs data management
services for UCT and NDA. GUCT also owned 17% of NDA. Since February 1, 1995,
UCT has been cooperating with NDA in providing clinical trials testing services
to pharmaceutical companies conducting clinical trials on a multi-national
basis.
Pursuant to the Agreement, GUCT and the NDA stockholders contributed their
respective holdings in NDA (aggregating 100%) and GUCT contributed its 100%
holdings in UCT and Pharmasoft to a newly formed Delaware corporation, UCT
International, Inc. ("UCTI"). GUCT also converted an aggregate of approximately
$1.9 million of debt of NDA and approximately UK(pound)0.3 million of debt of
UCT into equity of NDA and UCT respectively, which were then exchanged for stock
of UCTI. Further, GUCT contributed approximately $2.2 million to UCTI, which
together with the other contributions of stock caused GUCT's ownership in UCTI
to be approximately 70% at January 31, 1997.
The relative values of the shares of NDA, UCT and Pharmasoft were
negotiated between GUCT, NDA and the NDA stockholders. The conversion of
approximately $2.75 million of stockholders' debt of NDA (including $1.9 million
of GUCT) and approximately UK(pound)0.3 million of debt of UCT into equity of
NDA and UCT respectively, which were then exchanged for stock of UCTI and the
additional investment of approximately $2.45 million ($2.2 million from GUCT) in
UCTI were all valued at $150 per share of UCTI.
The source of funds for the purchase of UCTI stock by GUCT was the working
capital of the registrant. The tangible assets acquired consist of the assets of
NDA, including plant and equipment with a book value of approximately $.9
million. GUCT intends to continue the same use of such assets in the clinical
trials business of UCTI.
2
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of NDA filed as part of this report:
1. Balance Sheets as of December 31, 1995 and December 31, 1994.
2. Statement of Operations for the Years Ended December 31,
1995 and December 31, 1994.
3. Statement of Cash Flows for the Years Ended December 31,
1995 and December 31, 1994.
4. Statement of Changes in Stockholder Equity (Deficit)for the
Years Ended December 31, 1995 and December 31, 1994.
5. Notes to the above-listed Financial Statements.
6. Report of Independent Accountants, Price Waterhouse LLP,
dated June 7, 1996, with respect to the above-listed
Financial Statements, to be filed by amendment on or before
April 15, 1997.
7. Unaudited interim Balance Sheet and Profit and Loss
Statement as of December 31, 1996, to be filed by amendment
on or before April 15, 1997.
(b) Pro Forma Financial Information
Any pro forma financial information that would be required
pursuant to Article 11 of Regulation S-X will be filed by
amendment on or before April 15, 1997.
(c) Exhibits
(2) Master Combination Agreement by and among NDA Clinical Trial
Services, Inc. ("NDA"), Various Stockholders of NDA and
Global Unilabs Clinical Trials, Ltd., dated as of
January 31, 1997.
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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.
UNIHOLDING CORPORATION
(Registrant)
Date: February 14, 1997 By: /s/BRUNO ADAM
-------------------------------
BRUNO ADAM
Chief Financial Officer
4
NDA Clinical Trial
Services, Inc
Financial Statements
December 31, 1995 and 1994
5
NDA Clinical Trial Services, Inc.
Balance Sheet
December 31,
1995 1994
Assets
Current assets
Cash $ 338,021 $ 713,541
Accounts receivable 420,757 180,583
Prepaid expenses and other current assets 51,577 44,576
------- -------
Total current assets 810,355 938,700
Fixed assets, net (Note 4) 684,354 351,879
Intangible assets, net (Note 3) 79,048 129,765
Other assets 12,799 --
-------- ---------
1,586,556 1,420,344
========= =========
6
December 31,
1995 1994
---------- ----------
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued expenses 702,569 $ 396,212
Loans payable to stockholders (Note 7) 425,277 197,777
Obligations under capital leases (Note 9) 102,370 66,761
Deferred testing and supplies revenue 332,662 161,049
------- -------
Total current liabilities 1,562,878 821,799
Obligations under capital leases (Note 9) 153,513 154,061
Deferred testing and supplies revenue 753,367 419,908
------- --------
2,469,758 1,395,768
Stockholders' (deficit) equity (Note 5)
Class A Voting Common Stock - $.01 par value;
500,000 shares authorized, 32,425 and 20,000
shares issued and outstanding at December 31,
1995 and 1994; 324 200
Class A Voting Common Stock subject to put
option - 17,025 shares issued and outstanding
at December 31, 1995 and 1994 1,706,126 1,706,126
Class A Non-Voting Common Stock - $.01 par
value; 50,000 shares authorized, 2,280 shares
issued and outstanding at December 31, 1995
and 1994; 23 23
Additional paid-in-capital 2,349,690 816,975
Accumulated loss as an S Corporation (1,628,004) (1,628,004)
Accumulated Deficit (3,175,861) (735,244)
Less:
Treasury stock - 10,000 shares of
Class A Voting Common Stock, at cost (135,500) (135,500)
--------- ---------
Total stockholders' (deficit) equity (883,202) 24,576
--------- -------
$1,586,556 $1,420,344
The accompanying notes are an integral part of these financial statements.
7
NDA Clinical Trial Services, Inc.
Statement of Operations
Years Ended
December 31,
1995 1994
Revenue $ 1,928,014 $ 928,150
------------ -----------
Cost and expenses
Cost of revenue 1,634,176 682,608
General and administrative 1,314,522 1,097,811
Selling and marketing 857,535 546,123
Management information systems 337,239 247,210
Depreciation and amortization 181,713 74,536
------- ------
4,325,185 2,648,288
--------- ---------
Loss from operations (2,397,171) (1,720,138)
Interest expense, net 43,446 1,692
------ ---------
Net loss $(2,440,617) $(1,721,830)
============ ============
The accompanying notes are an integral part of these financial statements.
8
NDA Clinical Trial Services, Inc.
Statement of Cash Flows
Years Ended
December 31,
1995 1994
---- ----
Cash flows from operating activities
Net loss $ (2,440,617) $ (1,721,830)
Adjustments to reconcile net
loss to cash provided by operating
activities:
Depreciation and amortization 181,713 74,536
(Increase) decrease in operating assets
Accounts receivable (240,174) (147,139)
Prepaids and other current
and noncurrent assets (19,800) 120,024
Increase in operating liabilities
Accounts payable and accrued expenses 306,357 219,213
Deferred testing and supplies revenue 505,072 10,213
------- --------
Net cash used in operating activities (1,705,449) (1,444,983)
----------- -----------
Cash flows used in investing activities
Fixed asset acquisitions (340,703) (130,310)
--------- ---------
Cash flows from financing activities
Principal payments under capital lease obligation (87,707) -
Proceeds from the issuance of
Class A Voting Common Stock 1,532,839 1,781,174
Stockholder loans, net repayments 227,500 347,777
------- -------
Net cash provided by
financing activities 1,672,632 2,128,951
--------- ---------
Net (decreases) increase in cash (375,520) 553,658
Cash at beginning of year 713,541 159,883
------- -------
Cash at end of year $ 338,021 $ 713,541
========== ==========
The accompanying notes are an integral part of these financial statements.
9
NDA Clinical Trial Services, Inc.
Statement of Changes in Stockholder, Equity (Deficit)
Years ended December 31, 1995 and 1994
Class A Voting Class A Non-Voting
Common Stock Common Stock
Amount
Number of Subject to Number Additional paid Accumulated
Shares Amount put Option of Shares Amount In-capital Deficit
------ ------ ---------- --------- ------ ---------- -------
Balance at January 1, 1994 ...... 200 $ 2 -- 23 $ -- $ 592,148 $ (641,418)
One hundred-for-one
common stock split ............. 19,800 198 -- 2,257 $ 23 (221)
Contribution of Class A Voting
Common Stock by stockholders
to the Company .............. (2,955) (29) -- -- -- 29 --
Conversion of loans payable to
stockholder to Class A
Voting Common Stock ............ 2,214 22 -- -- -- 149,978 --
Issuance of Shares of Class A
Voting Common Stock, subject
to put option, for cash, net
of related expenses of $145,478,
paid in cash and stock ......... 9,874 -- $ 854,522 -- -- --
Issuance of Class A Voting Common
Stock for services rendered .... 741 7 -- -- -- 75,041 --
Issuance of Class A Voting Common
Stock for cash, net of related
expense of $17,458 ............. 7,151 -- $ 81,604 -- -- -- --
Net loss ........................ -- -- -- -- -- -- (1,721,830)
------- ------ --------- ------- -------- ----------- -----------
Balance at December 31, 1994 ... 37,025 $ 200 $ 1,706,126 2,280 $ 23 $ 816,975 $(2,363,218)
-------- ------ ----------- ------- -------- ----------- -----------
Issuance of Class A Voting
Common Stock for cash, net
of related expense of $3,250 ... 3,493 $ 35 -- -- -- $ 421,219 --
Issuance of Class A Voting
Common Stock for cash, net
of related expenses of $74,371 . 8,932 69 -- -- -- 1,111,496 --
Net loss ........................ -- -- -- -- -- -- (2,446,617)
Balance at December 31, 1995 .. 49,450 $ 324 $ 1,706,126 2,280 $ 23 $ 3,349,690 $(4,803,865)
========= ========= =========== ======= ======= =========== ============
The accompanying notes are an integral part of these financial statements.
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NDA Clinical Trial Services, Inc.
Statement of Changes in Stockholder, Equity (Deficit)
(Continued)
Years ended December 31, 1995 and 1994
Treasury Stock
Stockholders'
Number of Equity
Shares Amount (Deficit)
------ ------ ---------
Balance at January 1, 1994 10,000 $ (135,500) $ (184,768)
One hundred-for-one
common stock split -- -- --
Contribution of Class A Voting
Common Stock by stockholders
to the Company -- -- --
Conversion of loans payable to
stockholder to Class A
Voting Common Stock -- -- 150,000
Issuance of Shares of Class A Voting
Common Stock, subject to put option,
for cash, net of related expenses of
$145,478, paid in cash and stock -- -- --
Issuance of Class A Voting Common
Stock for services rendered -- -- 75,028
Issuance of Class A Voting Common
Stock for cash, net of related
expense of $17,458 -- -- 851,604
Net loss -- -- (1,721,830)
------- --------- ------------
Balance at December 31, 1994 10,000 $ (135,500) $24,576
-------- ---------- ------------
Issuance of Class A Voting
Common Stock for cash, net
of related expense of $3,250 -- -- 421,251
Issuance of Class A Voting
Common Stock for cash, net
of related expenses of $74,371 -- -- 1,111,585
Net loss -- -- (2,440,617)
Balance at December 31, 1995 865)10,000 $ (135,500) $(883,202)
========== =========== ==========
The accompanying notes are an integral part of these financial statements.
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NDA Clinical Trial Services, Inc.
Notes to Financial Statements
1. Organization and Business
NDA Clinical Trial Services, Inc. (the "Company or NDA") was
incorporated in April 1993 for the purpose of engaging in central
laboratory testing for pharmaceutical, biotech and contract research
organization.
2. Liquidity
The Company has incurred losses from operations since its inception and
has an accumulated deficit and a working capital deficit at December
31, 1995. The Company's ability to continue operations as a going
concern is dependent on its ability to obtain additional equity
financing in the short-term and achieve profitable operations in the
longer-term.
3. Summary of Significant Accounting Policies
Revenue recognition
Revenue from the laboratory testing is recognized when the testing is
performed. Revenue from supplies is recognized ratably over the period
of the related contract. Payments received in advance are classified in
advance as deferred testing and supplies revenue.
Fixed assets
Fixed assets are stated at cost less accumulated depreciation.
Depreciation of fixed assets is recorded on a straight-line basis over
their estimated useful lives of five years. Certain leased laboratory
equipment with future rental payments for periods though 1999 have been
capitalized. These amounts are included in fixed assets within the
accompanying balance sheet and are being amortized over the estimated
useful lives of the equipment which is five years.
Intangible asset
Intangible assets are stated at acquisition cost and consist of trade
names, covenants not to compete, customer lists and purchased software.
Amortization is provided on a straight line basis over five years.
Amortization expense for the years ended December 31, 1995 and 1994 was
$51,052 and $50,715, respectively. Accumulated amortization was
$113,102 and $62,050 at December 31, 1995 and 1994, respectively.
Management estimates
The presentation 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.
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NDA Clinical Trial Services, Inc.
Notes to Financial Statements
Supplemental cash flow information
Capital lease obligations of $122,768 and $220,822 were incurred during
the years ended December 31, 1995 and 1994, respectively. Taxes paid
were $1,269 and $325 during the years ended December 31, 1995 and 1994,
respectively. Interest paid was $23,631 and $1,692 during the years
ended December 31, 1995 and 1994, respectively. Common stock was issued
upon the conversion of $150,000 of payables to stockholders during the
year ended December 31, 1994. Common stock, valued at $75,048, was
issued in satisfaction of certain expenses incurred in connection with
a stock purchase agreement during the year ended December 31, 1994.
Common stock, valued at $92,150, was issued in exchange for certain
intangible assets during the year ended December 31, 1994.
4. Fixed Assets
Fixed assets at December 31, 1995 and 1994 consist of the following
1995 1994
---- ----
Laboratory equipment $ 242,933 $ 89,735
Computer equipment 225,269 61,795
Furniture and office equipment 28,044 6,078
Equipment under capital leases 343,590 228,822
------- -------
839,836 378,430
Less - Accumulated depreciation 155,482 26,551
------- ------
$ 684,354 $ 351,879
========= =========
Depreciation expense for the years ended December 31, 1995 and 1994 was $130,661
and $19,360, respectively.
5. Stockholders' Equity
Stock split
On August 1, 1994, the stockholders authorized an amendment to the
Certificate of Incorporation which provided for a stock split on a 100-
for-1 basis of all issued Class A Voting and Non-Voting Common Stock at
a par value of $.01. The par value of the new shares issued totalled
$221, which was transferred from additional paid-in-capital to common
stock.
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NDA Clinical Trial Services, Inc.
Notes to Financial Statements
Put option
Certain stockholders were granted a put option, exercisable only one to
put all or a part of their common shares to the Company, at any time
after June 2000, at a price per common share equal to nine times the
Company's post tax earnings per share for the four fiscal quarters
prior to the exercise of the put option. These put options expire upon
the successful completion of a public offering f the securities of the
Company in an aggregate amount in excess of $5,000,000.
Stock option
In conjunction with the sale of common stock, the Company issued an
option to purchase certain number of shares, at a price per share of
$133, which when added to all other shares, will result in the
stockholder owning 30% of all outstanding stock of the Company. The
option becomes exercisable upon the issuance of the Company's December
31, 1996 audited financial statements and expires in thirty days.
6. Stock Option Plan
During 1994, the Company adopted a stock option plan, which permits the
issuance of incentive or non-qualified stock options, stock
appreciation rights, restricted stock, performance shares, loans and/or
tax offset payments to certain key employees. At December 31, 1995,
3,300 shares were reserved for issuance and 775 options were
outstanding.
7. Related Party Transactions
The Company leases its office and laboratory facilities from NDA
Properties, a company owned by a stockholder of the Company. Rent
expense for the year ended December 31, 1995 and 1994 was approximately
$241,646 and $180,000, respectively.
At December 31, 1995 loans payable to stockholders include $337,500
borrowed from stockholders in 1995 in the form of 12% demand loans and
$87,777 of non-interest bearing demand loans from stockholders.
8. Income Taxes
Effective August 1, 1994, the Company's S Corporation status was
terminated. Since such date, the Company has incurred approximately
$3,400,000 in operating losses which are available to offset future
federal taxable income through 2010.
Cross deferred tax assets of approximately $1,200,000 are fully offset
by a valuation allowance and arise primarily from net operating loss
carry forwards and differences in the amounts of depreciations and
accruals for financial reporting purposes and income tax purposes.
14
NDA Clinical Trial Services, Inc.
Notes to Financial Statements
9. Commitments
Lease commitments
The Company is obligated under capital and operating leases for its
office and certain equipment. Future minimum payments under leases,
with initial or remaining terms of one year or more, consist of the
following at December 31, 1995:
Capital Operating
Leases Leases
1996 $ 119,962 $ 255,871
1997 107,895 207,999
1998 30,697 220,690
1999 30,697 228,000
2000 - 240,000
-------- ---------
Total minimum lease payments $ 289,251 $ 1,152,560
===========
Less - Amounts representing interest 33,368
------
Present value of net
minimum lease payments $ 255,883
=========
10. Major Customers
Sales to one customer accounted for approximately 58% and 67% of
revenues for the year ended December 31, 1995 and 1994, respectively.