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): September 29, 1995
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SUNGARD DATA SYSTEMS INC.
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(Exact name of registrant specified in its charter)
Delaware 7379 51-0267091
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(State or other (Commission (IRS Employee
jurisdiction of File Number) Identification No.)
incorporation)
1285 DRUMMERS LANE WAYNE, PENNSYLVANIA 19087
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(Address of principal executive offices) (Zip Code)
Registrant's telephone, including area code: (610) 341-8700
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(Former name and former address, if changed since last report)
Item 5. Other Events
------------
On September 29, 1995, SunGard Data Systems Inc., a Delaware
corporation ("SunGard"), MACESS Corporation, an Alabama corporation ("MACESS"),
and SDS Merger Inc., an Alabama corporation and wholly owned subsidiary of
SunGard ("Newco"), signed an Agreement and Plan of Merger (the "Merger
Agreement") and a related Agreement and Plan of Reorganization (the
"Reorganization Agreement") by and among MACESS, the eight principal
shareholders of MACESS (the "Principals"), SunGard and Newco, providing for the
merger (the "MACESS Merger") of Newco with and into MACESS with MACESS surviving
as a wholly owned subsidiary of SunGard. MACESS' principal business is providing
work-flow management and document imaging systems to the healthcare industry,
with an emphasis on managed healthcare providers. Total consideration for the
MACESS Merger will be 1,990,000 shares of SunGard common stock, par value $.01
per share ("SunGard Common Stock"), subject to adjustment only for
recapitalization, having a value of approximately $57,710,000 based on the last
sale price of SunGard Common Stock on October 2, 1995 as reported on The Nasdaq
Stock Market. The closing of the MACESS Merger is subject to certain conditions,
including, among other conditions, certain regulatory approvals and the approval
of the shareholders of MACESS. The closing of the MACESS Merger is expected to
occur in November 1995. The Reorganization Agreement and Merger Agreement
attached hereto as Exhibits 2.1 and 2.2, respectively, and SunGard's press
release dated October 2, 1995 attached hereto as Exhibit 99.1 are incorporated
herein by reference.
On September 28, 1995, SunGard and Renaissance Software Inc., a
California corporation ("Renaissance"), announced the signing of an Agreement
and Plan of Merger and a related Agreement and Plan of Reorganization by and
among Renaissance, the four principal shareholders of Renaissance, SunGard and a
wholly owned subsidiary of SunGard, providing for the merger (the "Renaissance
Merger") of such subsidiary with and into Renaissance with Renaissance surviving
as a wholly owned subsidiary of SunGard. Renaissance's principal business is
developing and licensing software used by financial institutions, banks and
other market makers in the trading of over-the-counter interest rate derivative
instruments. The closing of the Renaissance Merger is subject to certain
conditions, including, among other conditions, certain regulatory approvals and
the approval of the shareholders of Renaissance. The closing is expected to
occur in November 1995. SunGard's press release dated September 28, 1995
attached hereto as Exhibit 99.2 is incorporated herein by reference.
On August 31, 1995, SunGard completed the acquisition of Intelus
Corporation, a Delaware corporation ("Intelus"), whereby Intelus became a wholly
owned subsidiary of SunGard in accordance with an Agreement and Plan of Merger
and a related Agreement and Plan of Reorganization dated August 23, 1995 (the
"Intelus Merger"). Intelus' principal business is providing work-flow
management and document imaging systems to the healthcare and financial services
industries, with an emphasis on hospitals.
The three business acquisitions described above will be accounted for
as poolings-of-interests. Additionally, during the nine month period ended
September 30, 1995, SunGard has completed five business acquisitions accounted
for as purchases, none of which are expected to have a material effect on
SunGard's financial condition or results of operations.
As described in the press release attached as Exhibit 99.1, MACESS and
Intelus will form the nucleus of a new business group called SunGard Technology
Systems, headed by Kenneth R. Adams who was chief executive officer of SunGard's
Recovery Services Group. Michael F. Mulholland, president and chief operating
officer of SunGard Recovery Services Inc., has succeeded Mr. Adams as Chief
Executive Officer of the Recovery Services Group. With the addition of
Renaissance, SunGard is also reorganizing its trading and risk management
businesses under the SunGard Trading Systems Group, formerly known as the
SunGard Capital Markets Group. The SunGard Trading Systems Group will continue
to be led by Cristobal I. Conde.
1
Item 7. Financial Statements and Exhibits
---------------------------------
(a) Financial Statements.
(1) MACESS Corporation, attached hereto as Appendix I.
a. Report of Independent Auditors dated May 31, 1995.
b. Balance Sheets as of June 30, 1995 (unaudited) and
December 31, 1994 and 1993.
c. Statements of Income for the six months ended June 30,
1995 and 1994 (unaudited), for the years ended
December 31, 1994 and 1993, and for the year ended
December 31, 1992 (unaudited).
d. Statements of Cash Flows for the six months ended June
30, 1995 and 1994 (unaudited), for the years ended
December 31, 1994 and 1993, and for the year ended
December 31, 1992 (unaudited).
e. Statements of Changes in Stockholders' Equity for the
six months ended June 30, 1995 (unaudited), for the
years ended December 31, 1994 and 1993, and for the year
ended December 31, 1992 (unaudited).
f. Notes to Financial Statements.
(2) Renaissance Software Inc., attached hereto as Appendix II.
a. Independent Auditors' Report dated May 17, 1995
(September 23, 1995 as to Note 8).
b. Consolidated Balance Sheet as of March 31, 1995.
c. Consolidated Statement of Income for the year
ended March 31, 1995.
d. Consolidated Statement of Cash Flows for the year
ended March 31, 1995.
e. Consolidated Statement of Shareholders' Equity for the
year ended March 31, 1995.
f. Notes to Consolidated Financial Statements.
g. Condensed Consolidated Balance Sheet as of
June 30, 1995 (unaudited).
h. Condensed Consolidated Statements of Income for the
three months ended June 30, 1995 and 1994 (unaudited).
i. Condensed Consolidated Statements of Cash Flows for the
three months ended June 30, 1995 and 1994 (unaudited).
j. Notes to Condensed Consolidated Financials Statements
(unaudited).
2
(3) Intelus Corporation, attached hereto as Appendix III.
a. Report of Independent Accountants dated August 29, 1995.
b. Balance Sheets as of June 30, 1995 and 1994 (unaudited)
and December 31, 1994 and 1993.
c. Statements of Operations for the six months ended June
30, 1995 and 1994 (unaudited) and for each of the two
years in the period ended December 31, 1994.
d. Statements of Cash Flows for the six months ended June
30, 1995 and 1994 (unaudited) and for each of the two
years in the period ended December 31, 1994.
e. Statements of Changes in Stockholders' Equity for the
six months ended June 30, 1995 (unaudited) and for each
of the two years in the period ended December 31, 1994.
f. Notes to Financial Statements.
(b) Pro Forma Financial Information, attached hereto as Appendix IV.
(1) Unaudited Pro Forma Combined Condensed Income Statement Data
of SunGard, MACESS, Renaissance and Intelus for the six months
ended June 30, 1995 and 1994 and for each of the three years in
the period ended December 31, 1994.
(c) Exhibits.
2.1 Agreement and Plan of Reorganization dated September 29, 1995 by
and among SunGard, Newco, MACESS and the Principals.
3
2.2 Agreement and Plan of Merger dated September 29, 1995 by and
among SunGard, Newco and MACESS.
23.1 Consent of Ernst & Young LLP, independent auditors, regarding
such firm's report on MACESS' audited financial statements.
23.2 Consent of Deloitte & Touche LLP, independent auditors, regarding
such firm's report on Renaissance's audited consolidated
financial statements.
23.3 Consent of Coopers & Lybrand L.L.P., independent accountants,
regarding such firm's report on Intelus' audited financial
statements.
99.1 Press Release dated October 2, 1995 regarding the MACESS and
Intelus acquisitions.
99.2 Press Release dated September 28, 1995 regarding the
Renaissance acquisition.
4
APPENDIX I
5
MACESS Corporation
Financial Statements
June 30, 1995 (unaudited) and 1994 (unaudited) and
December 31, 1994, 1993 and 1992 (unaudited)
with Report of Independent Auditors
MACESS Corporation
Financial Statements
June 30, 1995 (unaudited) and 1994 (unaudited) and
December 31, 1994, 1993 and 1992 (unaudited)
Contents
Report of Independent Auditors.............................................. 1
Financial Statements
Balance Sheets.............................................................. 2
Statements of Income........................................................ 3
Statements of Cash Flows.................................................... 4
Statements of Changes in Stockholders' Equity............................... 5
Notes to Financial Statements............................................... 7
Report of Independent Auditors
The Board of Directors
MACESS Corporation
We have audited the accompanying balance sheets of MACESS Corporation as of
December 31, 1994 and 1993, and the related statements of income, changes in
stockholders' equity and cash flows for the years then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of MACESS Corporation at December
31, 1994 and 1993, and the results of its operations and its cash flows for the
years then ended in conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
May 31, 1995
Birmingham, Alabama
1
MACESS Corporation
Balance Sheets
June 30 December 31
1995 1994 1993
---------------------------------------------------
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 1,592,490 $ 1,280,756 $ 503,978
Accounts receivable 2,340,190 1,313,703 551,604
Prepaid taxes -- 86,841 --
Prepaid expenses 67,384 30,984 2,445
---------------------------------------------------
Total current assets 4,000,064 2,712,284 1,058,027
Property, plant and equipment 903,330 562,225 385,725
Capitalized software development costs, less accumulated
amortization of $481,114 in 1995, $372,261 in 1994 and
$203,381 in 1993 569,353 505,231 364,202
---------------------------------------------------
Total assets $ 5,472,747 $ 3,779,740 $ 1,807,954
===================================================
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 249,139 $ 15,640 $ 41,821
Accrued liabilities 300,323 220,133 316,929
Taxes payable 350,268 -- 85,145
Deferred taxes payable 332,975 399,570 70,660
Notes payable to stockholders due within one year 407,465 403,317 400,000
---------------------------------------------------
Total current liabilities 1,640,170 1,038,660 914,555
---------------------------------------------------
Notes payable to stockholders 55,714 109,592 --
---------------------------------------------------
Deferred taxes payable 246,115 188,360 158,790
---------------------------------------------------
Stockholders' equity:
Common stock, voting 2,891 2,891 14,456
Common stock, non-voting 11,565 11,565 --
Paid-in-capital 12,461 12,461 --
Treasury stock (66,504) (66,504) --
Notes receivable (241,490) (267,750) --
Retained earnings 3,811,825 2,750,465 720,153
---------------------------------------------------
Total stockholders' equity 3,530,748 2,443,128 734,609
---------------------------------------------------
Total liabilities and stockholders' equity $ 5,472,747 $ 3,779,740 $ 1,807,954
===================================================
See accompanying notes.
2
MACESS Corporation
Statements of Income
Six months ended June 30 Year ended December 31
1995 1994 1994 1993 1992
---------------------------------------------------------------------------------------------
(Unaudited) (Unaudited)
Net sales $ 6,514,555 $ 5,597,064 $ 10,314,617 $ 6,470,204 $ 1,871,653
Cost of sales 2,379,868 1,716,353 3,983,625 2,877,628 488,451
---------------------------------------------------------------------------------------------
4,134,687 3,880,711 6,330,992 3,592,576 1,383,202
Operating expenses:
General and administrative:
Salaries 1,166,086 831,521 1,618,875 896,236 452,482
Other 683,134 267,821 602,505 345,093 377,581
Selling:
Salaries 388,696 282,487 564,974 279,532 150,828
Other 139,762 99,149 202,072 190,698 169,634
Research and development 46,940 9,799 56,301 16,300 32,878
---------------------------------------------------------------------------------------------
Income from operations 1,710,069 2,389,934 3,286,265 1,864,717 199,799
Interest expense 25,371 18,801 44,276 56,057 80,686
Loss on disposal of assets -- -- 73,213 201,370 --
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1,684,698 2,371,133 3,168,776 1,607,290 119,113
Provision for taxes 623,338 853,608 1,138,464 499,595 --
---------------------------------------------------------------------------------------------
Net income $ 1,061,360 $ 1,517,525 $ 2,030,312 $ 1,107,695 $ 119,113
=============================================================================================
See accompanying notes.
3
MACESS Corporation
Statements of Cash Flows
Six months ended June 30 Year ended December 31
1995 1994 1994 1993 1992
-------------------------------------------------------------------------------
(Unaudited) (Unaudited)
Cash flows from operating activities:
Net income $ 1,061,360 $ 1,517,525 $ 2,030,312 $ 1,107,695 $ 119,113
Adjustments to reconcile net income to net
cash provided (used) by operating activities:
Depreciation and amortization 214,431 153,800 326,417 280,199 181,919
Provision for deferred taxes (8,840) 354,656 358,480 229,450 --
Loss on disposal of assets -- -- 73,213 201,370 --
Change in assets and liabilities:
Accounts receivable (1,026,487) (954,018) (762,099) (545,694) (133,672)
Prepaid expenses (36,400) -- (28,539) (2,445) --
Accounts payable and accrued liabilities 313,689 (50,949) (122,977) 252,628 (264,054)
Taxes 437,109 227,633 (171,986) 85,145 --
-------------------------------------------------------------------------------
Total adjustments (106,498) (268,878) (327,491) 500,653 (215,807)
-------------------------------------------------------------------------------
Net cash provided (used) by operating activities 954,862 1,248,647 1,702,821 1,608,348 (96,694)
Cash flows from investing activities:
Purchase of equipment and leasehold improvements (446,683) (190,877) (389,749) (277,206) (17,203)
Additions to capitalized software development costs (172,975) (114,571) (327,410) (312,221) (133,692)
-------------------------------------------------------------------------------
Net cash used in investing activities (619,658) (305,448) (717,159) (589,427) (150,895)
-------------------------------------------------------------------------------
Cash flows from financing activities:
Issuance of notes payable -- -- -- -- 319,000
Issuance of stock -- -- -- -- 5,000
Net payments on stockholder notes (23,470) (170,283) (208,884) (640,943) --
-------------------------------------------------------------------------------
Net cash provided (used) by financing activities (23,470) (170,283) (208,884) (640,943) 324,000
-------------------------------------------------------------------------------
Increase in cash and cash equivalents 311,734 772,916 776,778 377,978 76,411
Cash and cash equivalents at beginning of period 1,280,756 503,978 503,978 126,000 49,589
-------------------------------------------------------------------------------
Cash and cash equivalents at end of period $ 1,592,490 $ 1,276,894 $ 1,280,756 $ 503,978 $ 126,000
===============================================================================
4
MACESS Corporation
Statements of Cash Flows (continued)
Six months ended June 30 Year ended December 31
1995 1994 1994 1993 1992
------------------------------------------------------------------------------------
(Unaudited) (Unaudited)
Supplemental disclosure of cash
flow information and non-cash transactions:
Cash paid during the period for:
Interest $ 8,288 $ 416 $ 18,912 $ -- $ 46,875
Income taxes 195,069 105,000 951,970 185,000 --
Issuance of note payable for purchase of
treasury stock -- 321,793 321,793 -- --
Issuance of notes receivable for sale of
treasury stock -- -- 267,750 -- --
See accompanying notes.
5
MACESS Corporation
Statements of Changes in Stockholders' Equity
Common stock, par value of $.002;
1,500,000 shares authorized, Common stock, $.002 par value;
1,445,600 shares issued and 6,000,000 shares authorized,
1,430,100, 1,430,100, 1,445,600 5,782,400 shares issued and
and 1,445,600 shares outstanding 5,720,400 outstanding at
at June 30, 1995 and December 31, June 30, 1995 and
1994, 1993, and 1992, respectively December 31, 1994
-------------------------------------------------------------------
Voting Non-Voting Paid-in Treasury
Shares Amount Shares Amount Capital Stock
---------------------------------------------------------------------------------------------------
Balance at December 31, 1991
(unaudited) 945,600 $ 9,456 -- $ -- $ -- $ --
Issuance of stock 500,000 5,000 -- -- -- --
Net income -- -- -- -- -- --
----------------------------------------------------------------------------------------------------
Balance at December 31, 1992
(unaudited) 1,445,600 14,456 -- -- -- --
Net income -- -- -- -- -- --
----------------------------------------------------------------------------------------------------
Balance at December 31, 1993 1,445,600 14,456 -- -- -- --
Purchase of treasury stock -- -- -- -- -- (321,793)
Treasury stock sold -- -- -- -- 12,461 255,289
Five-for-one stock split -- (11,565) 5,782,400 11,565 -- --
Net income -- -- -- -- -- --
----------------------------------------------------------------------------------------------------
Balance at December 31, 1994 1,445,600 2,891 5,782,400 11,565 12,461 (66,504)
Payments on notes receivable -- -- -- -- -- --
Net income -- -- -- -- -- --
----------------------------------------------------------------------------------------------------
Balance at June 30, 1995
(unaudited) 1,445,600 $ 2,891 5,782,400 $ 11,565 $ 12,461 $ (66,504)
====================================================================================================
Total
Retained Stockholders'
Notes Earnings Equity
Receivable (Deficit) (Deficit)
-------------------------------------------------------
Balance at December 31, 1991
(unaudited) $ -- $ (506,655) $ (497,199)
Issuance of stock -- -- 5,000
Net income -- 119,113 119,113
-------------------------------------------------------
Balance at December 31, 1992
(unaudited) -- (387,542) (373,086)
Net income -- 1,107,695 1,107,695
-------------------------------------------------------
Balance at December 31, 1993 -- 720,153 734,609
Purchase of treasury stock -- -- (321,793)
Treasury stock sold (267,750) -- --
Five-for-one stock split -- -- --
Net income -- 2,030,312 2,030,312
-------------------------------------------------------
Balance at December 31, 1994 (267,750) 2,750,465 2,443,128
Payments on notes receivable 26,260 -- 26,260
Net income -- 1,061,360 1,061,360
-------------------------------------------------------
Balance at June 30, 1995
(unaudited) $ (241,490) $ 3,811,825 $ 3,530,748
=======================================================
See accompanying notes.
6
MACESS Corporation
Notes to Financial Statements
June 30, 1995 (unaudited) and 1994 (unaudited) and
December 31, 1994, 1993 and 1992 (unaudited)
1. Basis of Presentation
MACESS Corporation (the Company) was formed December 29, 1989 for the purpose of
developing and selling computer software, providing consultation, installation
and training services to meet the needs of potential customers. The Company's
software sales are part of a turnkey vertical market solution to meet its
customers needs which include the above-mentioned services as well as support
and maintenance services and ongoing software sales.
The accompanying unaudited financial statements for the six months ended
June 30, 1995 and 1994 have been prepared in accordance with generally accepted
accounting principles for interim financial information. The Company has
included adjustments (consisting of normal recurring accruals) necessary for a
fair presentation of the Company's financial position at June 30, 1995 and
results of operations and cash flows for the six-month periods ended June 30,
1995 and 1994.
2. Accounting Policies
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers all highly
liquid investments with a maturity of three months or less to be cash
equivalents. Cash equivalents, consisting primarily of money market funds, are
valued at cost which approximates market.
Property, Plant and Equipment
Property, plant and equipment are recorded at cost. Depreciation and
amortization are computed on the straight-line method over the estimated useful
lives of the related assets ranging from three to five years, except for
leasehold improvements which is 39 years.
7
MACESS Corporation
Notes to Financial Statements (continued)
2. Accounting Policies (continued)
Capitalized Software
Amortization of software development costs begins at the time the product is
ready for sale, and is calculated on the straight-line method over the estimated
economic life of the product. Research and development costs related to
software development are expensed as incurred.
Taxes
Deferred taxes are provided for differences between financial and income tax
reporting.
Revenue Recognition
The Company recognizes revenue based on the terms of the contract which
correlates to the percentage of completion method of accounting. The contract
payment terms for software, consulting and training generally include an initial
payment equal to 25% of the contract value, 50% after the computer system is
installed and the final 25% 30 to 90 days after installation. The contract
payment terms for hardware generally include an initial payment equal to 25% of
the contract value and 75% after the computer system is installed. The Company
generally does not require collateral as security for payment.
3. Property, Plant and Equipment
Property, plant and equipment, net consists of the following:
June 30 December 31
1995 1994 1993
------------------------------------
(Unaudited)
Furniture and equipment $ 517,674 $ 300,114 $ 154,533
Leasehold improvements 46,206 - 47,913
Computer equipment 701,812 518,895 332,303
-------------------------------------
1,265,692 819,009 534,749
Less accumulated depreciation (362,362) (256,784) (149,024)
--------------------------------------
$ 903,330 $ 562,225 $ 385,725
======================================
8
MACESS Corporation
Notes to Financial Statements (continued)
4. Capitalized Software Development Costs
The Company capitalized salaries and indirect costs of $172,975 for the six
months ended June 30, 1995 and $327,410, $312,221 and $133,692 in 1994, 1993 and
1992, respectively, relating to the development of new software products,
including product enhancements. Capitalization of software development costs
begins upon the establishment of technological feasibility and continues until
such software is available for sale.
The establishment of technological feasibility, the point at which the product
is ready for general release, and the ongoing assessment of recoverability of
capitalized software development costs requires the exercise of judgment by
management. In the opinion of management, all such costs capitalized at June 30,
1995 are recoverable through anticipated future sales of the applicable
products.
5. Notes Payable to Stockholders
Notes payable to stockholders consisted of the following:
June 30 December 31
1995 1994 1993
-----------------------------------------
(Unaudited)
Notes payable to stockholder,
interest at 8%, payable on demand $ 300,544 $ 300,544 $ 400,000
Note payable to stockholder, interest
at 8%, payable in monthly
installments through 1996 and
1997 162,635 212,365 --
-----------------------------------------
463,179 512,909 400,000
Less current maturities (407,465) (403,317) (400,000)
-----------------------------------------
$ 55,714 $ 109,592 $ --
=========================================
In 1994 the Company purchased 75,000 shares of common stock from a stockholder
through the issuance of a note payable of $321,793, with a balance of $212,365
at December 31, 1994. In connection with this transaction, the Company entered
into a covenant not-to-compete with monthly payments of $6,250 through December
31, 1997.
9
MACESS Corporation
Notes to Financial Statements (continued)
5. Notes Payable to Stockholders (continued)
The Company's notes payable mature as follows:
1995 $ 407,465
1996 55,714
---------------
$ 463,179
===============
6. Taxes
The Company follows the provisions of Financial Accounting Standards Board
Statement No. 109 "Accounting for Income Taxes." Under Statement 109, the
liability method is used in accounting for income taxes. Deferred tax assets
and liabilities are determined based on differences between financial reporting
and tax bases of assets and liabilities and are measured using the enacted tax
rates and laws that will be in effect when the differences are expected to
reverse.
The provision for taxes as a percentage of income before taxes differs from the
U.S. federal statutory rate as follows:
Six months
ended June 30 December 31
1995 1994 1993 1992
---------------------------------------------------------------
(Unaudited) (Unaudited)
Federal provision at the current
statutory rate $ 572,797 $ 1,077,384 $ 546,479 $ 40,498
Tax (benefit) resulting from:
State tax expense 50,541 62,414 27,023 3,573
Adjustment to provision -- -- 50,000 --
Change in beginning of the year
valuation allowance -- (123,907) (44,071)
Other -- (1,334) -- --
---------------------------------------------------------------
$ 623,338 $ 1,138,464 $ 499,595 $ --
===============================================================
10
MACESS Corporation
Notes to Financial Statements (continued)
6. Taxes (continued)
An analysis of the Company's tax provision is as follows:
Six months
ended June 30 December 31
1995 1994 1993 1992
---------------------------------------------------------------
(Unaudited) (Unaudited)
Current:
Federal $ 579,091 $ 714,484 $ 247,806 $ -
State 53,087 65,500 22,339 -
---------------------------------------------------------------
632,178 779,984 270,145 -
---------------------------------------------------------------
Deferred:
Federal (8,122) 329,414 210,845 -
State (718) 29,066 18,605 -
---------------------------------------------------------------
(8,840) 358,480 229,450 -
---------------------------------------------------------------
$ 623,338 $ 1,138,464 $ 499,595 $ -
===============================================================
The deferred tax position is as follows:
June 30 December 31
1995 1994 1993
--------------------------------------------
(Unaudited)
Deferred tax liabilities:
Accrual to cash differences $ 332,975 $ 399,570 $ 70,660
Capitalized software 209,115 154,075 134,755
Tax over book depreciation 37,000 34,285 24,035
--------------------------------------------
$ 579,090 $ 587,930 $ 229,450
============================================
7. 401(k) Plan
The Company began a 401(k) plan in April 1994. The Plan covers substantially
all of the Company's employees ages 21 and over who have completed 12 months of
service. The Company matches contributions in amounts determined by the Board
of Directors at the beginning of each Plan year. The Company's contribution to
the Plan in 1994 was $16,500, and $30,117 for the six months ended June 30,
1995.
11
MACESS Corporation
Notes to Financial Statements (continued)
8. Commitments
The Company leases its office space under an operating lease. Rental expense
amounted to $156,889 for the six months ended June 30, 1995, and $171,579,
$108,473 and $51,911 in 1994, 1993 and 1992, respectively. Future minimum lease
payments under the lease are $276,500 annually through 1999.
9. Related Party Transactions
Effective January 1, 1993, the Company entered into a management agreement with
Complete Health Services, Inc. (CHS) which terminated April 15, 1994. CHS was
founded by a major shareholder of the Company and sold to an unrelated party in
May 1994. In return for services provided to CHS at substantially reduced
rates, CHS agreed to provide all accounting, payroll and bookkeeping functions
for the Company. In connection with this agreement, the Company recognized
revenue and management fee expense of $5,800 and $12,500 in 1994 and 1993,
respectively.
Under the terms of the agreement, CHS also employed all employees on behalf of
the Company and was fully reimbursed at the end of each month by the Company.
Included in general and administrative and selling expenses is $1,058,000, and
$1,373,000 in 1994, and 1993, respectively, for such reimbursed amounts.
10. Subsequent Event (unaudited)
On September 29, 1995, the Company entered into an agreement with SunGard Data
Systems Inc. (SunGard) whereby all of the Company's common stock will be
exchanged for approximately 1,990,000 shares of SunGard's common stock.
12
APPENDIX II
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders
Renaissance Software, Inc.:
We have audited the accompanying consolidated balance sheet of Renaissance
Software, Inc. and its subsidiaries as of March 31, 1995, and the related
consolidated statements of income, shareholders' equity and cash flows for the
year then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all
material respects, the consolidated financial position of Renaissance Software,
Inc. and its subsidiaries as of March 31, 1995, and the results of their
operations and their cash flows for the year then ended, in conformity with
generally accepted accounting principles.
DELOITTE & TOUCHE LLP
May 17, 1995 (September 23, 1995 as to Note 8)
San Jose, California
RENAISSANCE SOFTWARE, INC.
CONSOLIDATED BALANCE SHEET
MARCH 31, 1995 (In thousands, except share amounts)
- --------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS:
Cash and equivalents $ 5,500
Accounts receivable 3,725
Notes receivable from employees 40
Prepaid expenses 178
Deferred income taxes 332
-------
Total current assets 9,775
PROPERTY AND EQUIPMENT, Net 1,651
NOTES RECEIVABLE FROM EMPLOYEES 8
OTHER ASSETS 115
-------
TOTAL $11,549
=======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 503
Accrued compensation and related benefits 761
Deferred revenue 246
Other accrued liabilities 337
Income taxes payable 880
-------
Total current liabilities 2,727
-------
DEFERRED INCOME TAXES 28
-------
SHAREHOLDERS' EQUITY:
Convertible preferred stock, no par value; 20,000,000 shares
authorized; 2,560,000 shares outstanding; $2,560 aggregate
liquidation preference 2,000
Common stock, no par value; 30,000,000 shares authorized;
5,053,870 shares outstanding 3,520
Notes receivable from shareholders (2,076)
Deferred compensation (20)
Retained earnings 5,370
-------
Total shareholders' equity 8,794
-------
TOTAL $11,549
=======
See notes to consolidated financial statements.
RENAISSANCE SOFTWARE, INC.
CONSOLIDATED STATEMENT OF INCOME
YEAR ENDED MARCH 31, 1995 (In thousands)
- --------------------------------------------------------------------------------
NET REVENUES:
Licenses $ 8,874
Services 3,653
-------
Total net revenues 12,527
-------
COSTS AND EXPENSES:
Research and development 3,393
Selling, marketing and support 3,798
General and administrative 1,748
-------
Total costs and expenses 8,939
-------
INCOME FROM OPERATIONS 3,588
OTHER INCOME, Net 159
-------
INCOME BEFORE INCOME TAXES 3,747
PROVISION FOR INCOME TAXES 1,370
-------
NET INCOME $ 2,377
=======
See notes to consolidated financial statements.
RENAISSANCE SOFTWARE, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
YEAR ENDED MARCH 31, 1995 (In thousands)
- --------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 2,377
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 599
Amortization of deferred compensation 26
Loss on disposal of fixed assets 8
Interest accrued on notes receivable from shareholders (92)
Deferred income taxes (304)
Changes in operating assets and liabilities:
Accounts receivable (1,975)
Prepaid income taxes 1,064
Prepaid expenses and other assets (171)
Accounts payable 151
Accrued liabilities and deferred revenue 515
Income taxes payable 880
-------
Net cash provided by operating activities 3,078
-------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (1,055)
Collection of notes receivable 69
-------
Net cash used in investing activities (986)
-------
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock 2
Repurchase of common stock (95)
-------
Net cash used in financing activities (93)
-------
NET INCREASE IN CASH AND EQUIVALENTS 1,999
CASH AND EQUIVALENTS - Beginning of year 3,501
-------
CASH AND EQUIVALENTS - End of year $ 5,500
=======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION -
Income taxes paid $ 378
=======
NONCASH INVESTING AND FINANCING ACTIVITIES -
Issuance of common stock in exchange for notes receivable $ 81
=======
See notes to consolidated financial statements.
RENAISSANCE SOFTWARE, INC.
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
YEAR ENDED MARCH 31, 1995 (In thousands, except share amounts)
- --------------------------------------------------------------------------------
Notes
Preferred Stock Common Stock Receivable
------------------- ------------------ from Deferred Retained
Shares Amount Shares Amount Shareholders Compensation Earnings Total
BALANCES, April 1, 1994 2,560,000 $ 2,000 5,102,770 $3,453 $(1,923) $(46) $3,085 $6,569
Issuance of common stock for cash 5,800 2 2
Issuance of common stock in
exchange for notes receivable 90,000 81 (81) -
Repurchase of common stock (144,700) (16) 13 (92) (95)
Collection of notes receivable 7 7
Interest accrued on notes
receivable from shareholders (92) (92)
Amortization of deferred
compensation 26 26
Net income 2,377 2,377
--------- --------- --------- ------ ------- ---- ------ ------
BALANCES, March 31, 1995 2,560,000 $ 2,000 5,053,870 $3,520 $(2,076) $(20) $5,370 $8,794
========= ========= ========= ====== ======= ==== ====== ======
See notes to consolidated financial statements.
RENAISSANCE SOFTWARE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED MARCH 31, 1995
- --------------------------------------------------------------------------------
1. BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
Business - Renaissance Software, Inc. (the Company) is engaged in the
development, marketing and sale of software products and services for use
in the financial services and capital markets industries.
Basis of Presentation - The consolidated financial statements include the
Company and its wholly-owned subsidiaries. All significant intercompany
balances and transactions have been eliminated.
Cash and Equivalents - Cash equivalents consist of highly liquid debt
instruments purchased with original maturities of ninety days or less.
Property and Equipment - Property and equipment are stated at cost.
Depreciation is computed using the straight-line method over the estimated
useful lives of the related assets, which range from four to seven years.
Software Development Costs - Software development costs are expensed as
incurred until technological feasibility is established, at which time any
additional costs are capitalized in accordance with Statement of Financial
Accounting Standards No. 86, "Accounting for the Costs of Computer Software
To Be Sold, Leased, or Otherwise Marketed." Because the Company believes
its current process for developing software is essentially completed
concurrently with the establishment of technological feasibility, no costs
have been capitalized through March 31, 1995.
Revenue Recognition - Revenue from software licenses is recognized upon
installation and when no significant obligations remain outstanding. When
the Company receives payment prior to installation or fulfillment of
significant vendor obligations, such payments are recorded as deferred
revenue and are recognized as revenue upon installation or fulfillment of
significant vendor obligations. Contract revenues are generally recognized
upon completion of milestones and when such amounts are billable.
Maintenance revenue is recognized ratably over the term of the maintenance
agreement. Revenue from customer training, support, and other services is
recognized as the service is performed.
Income Taxes - The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109, which requires an
asset and liability approach for financial accounting and reporting of
income taxes.
2. NOTES RECEIVABLE
The notes receivable from employees are unsecured, bear interest at 5% to
6% per annum and are due September 1995 through February 1997.
3. PROPERTY AND EQUIPMENT
Property and equipment at March 31, 1995 consist of the following (in
thousands):
Equipment $ 2,245
Furniture and fixtures 555
Purchased software 296
-------
3,096
Accumulated depreciation (1,445)
-------
$ 1,651
=======
4. SHAREHOLDERS' EQUITY
Convertible Preferred Stock
Convertible preferred stock at March 31, 1995 consists of the following:
Shares
------------------------
Designated Issued Amount
Series A 200,000 - $ -
Series B-1 1,620,000 1,620,000 900,000
Series B-2 540,000 540,000 600,000
Series B-3 400,000 400,000 500,000
---------- ---------- ----------
2,760,000 2,560,000 $2,000,000
========== ========== ==========
The holders of convertible preferred stock are entitled to receive
dividends, prior and in preference to holders of common stock, when and if
declared by the Board of Directors. Each share of convertible preferred
stock has voting rights equal to its common stock equivalents and is
entitled to a liquidation preference of $1.00 per share.
Beginning June 30, 1995, each share of Series B-1, B-2 and B-3 preferred
stock is convertible into 1-1/8 shares of common stock at the option of the
holder. Such conversions are based on the initial conversion rate, as
defined in the stock purchase agreements, and are subject to certain
antidilution provisions. All outstanding shares of preferred stock
automatically convert to common stock upon the closing of an underwritten
public offering of the Company's common stock yielding proceeds in excess
of $7,500,000 and $3.00 per share.
The Company has reserved 2,880,000 shares of common stock for future
conversion of convertible preferred stock.
Common Stock and Stock Option Plan
In fiscal 1993, the Board of Directors approved the Renaissance Software,
Inc. 1992 Equity Incentive Plan (the Plan), which provides for the issuance
of up to 4,250,000 shares of common stock, incentive stock options and
nonqualified stock options. At March 31, 1995, a total of 3,183,870 shares
of common stock have been issued under the Plan, net of repurchases.
Common stock is issued at fair market value, as determined by the Board of
Directors, and generally vests over a period of three to five years. The
Company may repurchase such stock at the original issue price for unvested
shares. At March 31, 1995 there were 1,108,914 unvested shares. Options are
granted at fair market value, as determined by the Board of Directors, and
generally vest over a period of five years.
In fiscal 1995, the Company issued common stock to certain officers and
employees in exchange for notes receivable. The common stock vests ratably
over a period of three to five years. The notes receivable from the sale of
common stock bear interest at 5% to 10% and are due through 1997.
Option activity under the incentive and nonqualified stock option plan for
fiscal 1995 is as follows:
Shares Exercise
Under Option Price
Balance, April 1, 1994 64,400 $.40-.75
Exercised (5,800) .40
Canceled (14,200) .40-.75
-------
Balance, March 31, 1995 44,400 $.40-.75
=======
At March 31, 1995, options to purchase 26,600 shares of common stock were
exercisable and 1,021,730 shares were available for future grant.
5. INCOME TAXES
The provision for income taxes for the year ended March 31, 1995 consists
of the following (in thousands):
Current:
Federal $1,233
State 353
Foreign 88
------
1,674
------
Deferred:
Federal (307)
State 3
------
(304)
------
$1,370
======
Total provision for income taxes for the year ended March 31, 1995 differs
from amounts computed by applying the statutory federal income tax rate to
income before taxes as a result of the following (in thousands):
Statutory federal income tax $1,311
State income taxes, net of federal benefit 289
Research and experimentation credits (230)
------
$1,370
======
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amount of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes.
Significant components of the Company's deferred income tax assets and
liabilities as of March 31, 1995 are as follows (in thousands):
Deferred tax assets:
Accruals not currently deductible $221
State taxes 111
----
332
Deferred tax liabilities - depreciation (28)
----
Net deferred tax assets $304
====
6. LEASES
The Company leases its facilities under operating lease agreements, which
expire through April 2000. The lease agreements require the Company to pay
its allocable share of property taxes, insurance and normal maintenance
costs. The lease agreement for the Company's principal facility includes a
five-year renewal option.
Following is a schedule of future minimum lease payments at March 31, 1995
(in thousands):
Years Ending
March 31,
1996 $ 614
1997 582
1998 567
1999 505
2000 360
------
Total $2,628
======
Rent expense for the year ended March 31, 1995 was $405,000.
7. MAJOR CUSTOMERS
The Company's customers primarily represent large financial institutions.
During fiscal 1995, two customers accounted for 12% and 11% of the
Company's revenues, respectively. Sales to customers in Europe, Japan, and
Canada accounted for 39%, 13% and 4%, respectively, of fiscal 1995
revenues.
8. SUBSEQUENT EVENT
On September 23, 1995, the Company entered into an agreement and plan of
reorganization with SunGard Data Systems Inc. (SunGard) whereby all of the
Company's outstanding common and preferred stock will be exchanged for a
total of 1,512,931 shares of SunGard's common stock, subject to possible
adjustments as defined in the agreement.
* * * * *
RENAISSANCE SOFTWARE, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
JUNE 30, 1995 (In thousands, except share amounts)
- --------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS:
Cash and equivalents $ 6,592
Accounts receivable 2,283
Prepaid expenses and other current assets 211
Deferred income taxes 332
-------
Total current assets 9,418
PROPERTY AND EQUIPMENT, Net 1,580
OTHER ASSETS 186
-------
TOTAL $11,184
=======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 216
Deferred revenue 251
Other accrued liabilities 768
Income taxes payable 651
-------
Total current liabilities 1,886
-------
DEFERRED INCOME TAXES 28
-------
SHAREHOLDERS' EQUITY:
Convertible preferred stock, no par value; 20,000,000 shares
authorized; 2,560,000 shares outstanding; $2,560 aggregate
liquidation preference 2,000
Common stock, no par value; 30,000,000 shares authorized;
5,467,470 shares outstanding 4,066
Notes receivable from shareholders (2,641)
Deferred compensation (20)
Retained earnings 5,865
-------
Total shareholders' equity 9,270
-------
TOTAL $11,184
=======
RENAISSANCE SOFTWARE, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED JUNE 30, 1995 AND 1994 (In thousands)
- --------------------------------------------------------------------------------
1995 1994
NET REVENUES $3,060 $2,777
------ ------
COSTS AND EXPENSES:
Research and development 918 751
Selling, marketing and support 1,098 806
General and administrative 354 349
------ ------
Total costs and expenses 2,370 1,906
------ ------
INCOME FROM OPERATIONS 690 871
OTHER INCOME, Net 102 131
------ ------
INCOME BEFORE INCOME TAXES 792 1,002
PROVISION FOR INCOME TAXES 297 381
------ ------
NET INCOME $ 495 $ 621
====== ======
RENAISSANCE SOFTWARE, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED JUNE 30, 1995 AND 1994 (In thousands)
- --------------------------------------------------------------------------------
1995 1994
NET CASH PROVIDED BY OPERATING ACTIVITIES $1,198 $1,617
CASH FLOWS FROM INVESTING ACTIVITIES -
Purchases of property and equipment (106) (199)
CASH FLOWS FROM FINANCING ACTIVITIES -
Repurchase of common stock - (7)
------ ------
NET INCREASE IN CASH AND EQUIVALENTS 1,092 1,411
CASH AND EQUIVALENTS - Beginning of period 5,500 3,501
------ ------
CASH AND EQUIVALENTS - End of period $6,592 $4,912
====== ======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION -
Income taxes paid $ 526 $ 713
====== ======
NONCASH INVESTING AND FINANCING ACTIVITIES -
Issuance of common stock in exchange for notes receivable $ 546 $ -
====== ======
RENAISSANCE SOFTWARE, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. The accompanying condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating results for
the three month period ended June 30, 1995 are not necessarily indicative
of the results that may be expected or the fiscal year ending March 31,
1996.
APPENDIX III
Report of Independent Accountants
---------------------------------
To the Board of Directors
Intelus Corporation
We have audited the accompanying balance sheets of Intelus Corporation
as of December 31, 1994 and 1993, and the related statements of operations,
changes in stockholders' equity and cash flows for the years then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Intelus Corporation
as of December 31, 1994 and 1993, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted accounting
principles.
As discussed in Note 13, the Company has agreed to be acquired as of
August 31, 1995.
As discussed in Note 12, in 1993 the Company changed its method of
accounting for income taxes to conform with Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes".
COOPERS & LYBRAND L.L.P.
Washington, D.C.
August 29, 1995
1
INTELUS CORPORATION
BALANCE SHEETS
(unaudited)
ASSETS June 30, December 31,
--------------------------- ---------------------------
1995 1994 1994 1993
------------ ------------ ------------ ------------
Current assets:
Cash and equivalents $ 3,208 $ 12,632 $ 89,241 $ 42,225
Trade receivables, less allowance for doubtful
accounts of $115,599, $0, $100,599 and $0 2,883,809 1,643,639 2,553,158 1,877,355
Earned but unbilled receivables 2,921,178 1,714,172 1,897,805 1,648,510
Inventory 268,533 572,378 226,327 180,290
Prepaid expenses 235,412 166,200 103,291 113,985
Other current assets 41,668 17,245 108,969 11,215
------------ ------------ ------------ ------------
Total current assets 6,353,808 4,126,266 4,978,791 3,873,580
Property and equipment, less accumulated
depreciation of $432,059, $622,352, $330,281
and $547,748 920,896 478,629 693,852 420,407
Software development costs, less accumulated
amortization of $1,568,025, $1,170,641,
$1,425,265 and $927,453 2,965,596 2,316,584 2,701,797 1,878,050
Notes receivable 65,322 85,362 80,322 60,000
Other assets 9,780 10,729 13,240 11,203
------------ ------------ ------------ ------------
Total assets $ 10,315,402 $ 7,017,570 $ 8,468,002 $ 6,243,240
============ ============ ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Note payable to bank $ 2,703,000 $ 1,048,000 $ 1,463,000 $ 700,000
Current portion of long-term debt 97,085 81,044 160,212 95,590
Current portion of lease payable 31,986 - 34,452 -
Subordinated debt to related parties 500,000 - 366,668 -
Accounts payable 1,433,733 993,854 1,271,974 576,963
Accrued expenses 453,545 272,445 163,218 183,798
Dividends payable 116,667 - - -
Deferred revenue 2,007,008 415,859 1,900,383 790,030
------------ ------------ ------------ ------------
Total current liabilities 7,343,024 2,811,202 5,359,907 2,346,381
------------ ------------ ------------ ------------
Long-term debt 291,518 261,042 202,036 93,943
------------ ------------ ------------ ------------
Long-term lease payable 135,695 - 150,263 -
------------ ------------ ------------ ------------
Deferred income taxes 249,851 249,428 249,851 249,000
------------ ------------ ------------ ------------
Other noncurrent liabilities 13,458 15,090 13,459 17,537
------------ ------------ ------------ ------------
Redeemable convertible preferred stock, par value
$.01 per share; 2,044,445 shares authorized,
issued and outstanding; liquidation preference
of $2,500,000 2,500,000 2,500,000 2,500,000 2,500,000
------------ ------------ ------------ ------------
Stockholders' equity:
Common stock, par value $.001 per share;
7,500,000 shares authorized; 3,106,143,
3,086,310, 3,106,143 and 3,083,310 shares
issued 3,106 3,086 3,106 3,083
Capital in excess of par value 8,874 777 8,874 630
Retained earnings (deficit) (230,124) 1,176,945 (19,494) 1,032,666
------------ ------------ ------------ ------------
(218,144) 1,180,808 (7,514) 1,036,379
------------ ------------ ------------ ------------
Total Liabilities And Stockholders' Equity $ 10,315,402 $ 7,017,570 $ 8,468,002 $ 6,243,240
============ ============ ============ ============
The accompanying notes are an integral part of these financial statements.
INTELUS CORPORATION
STATEMENTS OF OPERATIONS
(unaudited)
for the six months ended June 30, for the year ended December 31,
-------------------------------- --------------------------------
1995 1994 1994 1993
------------ ------------ ------------ ------------
Revenues:
Systems and products $ 6,217,197 $ 2,950,012 $ 5,476,996 $ 4,947,299
Maintenance 893,963 744,374 1,488,408 1,348,508
------------ ------------ ------------ ------------
7,111,160 3,694,386 6,965,404 6,295,807
------------ ------------ ------------ ------------
Costs and expenses:
Cost of sales and direct operating 3,112,768 832,484 2,101,905 1,803,089
Sales, marketing and administration 3,261,425 2,377,853 5,140,701 3,233,447
Amortization of software products 392,134 230,507 497,312 376,688
Depreciation of property and equipment 295,365 75,618 131,665 166,004
------------ ------------ ------------ ------------
7,061,692 3,516,462 7,871,583 5,579,228
------------ ------------ ------------ ------------
Income (loss) from operations 49,468 177,924 (906,179) 716,579
Interest expense (152,686) (35,677) (149,118) (42,341)
Interest income 9,255 2,032 4,132 2,613
------------ ------------ ------------ ------------
Income (loss) before provision for income taxes
and cumulative effect of accounting change (93,963) 144,279 (1,051,165) 676,851
Provision for income taxes - - (995) -
Cumulative effect of accounting change - - - (14,832)
------------ ------------ ------------ ------------
Net (loss) income $ (93,963) $ 144,279 $ (1,052,160) $ 662,019
============ ============ ============ ============
The accompanying notes are an integral part of these financial statements.
INTELUS CORPORATION
STATEMENTS OF CASH FLOWS
(unaudited)
for the six months ended June 30, for the year ended December 31,
-------------------------------- --------------------------------
1995 1994 1994 1993
------------ ------------ ------------ ------------
Cash flows from operating activities:
Net (loss) income $ (93,963) $ 144,279 $ (1,052,160) $ 662,019
Adjustments to reconcile net (loss) income to net cash
provided by operating activities
Depreciation and amortization 515,993 317,292 670,524 542,692
Deferred income taxes, net - - 851 14,832
Cash effect of changes:
Billed receivables (330,651) 233,716 (675,803) (466,418)
Unbilled receivables (1,023,374) (65,663) (249,295) (823,008)
Inventory (42,206) (392,087) (46,037) (12,565)
Prepaid expenses (132,121) (52,215) 10,694 (50,353)
Other assets 70,760 (5,556) (99,791) (5,648)
Accounts payable 161,760 416,891 695,011 258,070
Accrued expenses 290,327 89,075 (20,580) 77,603
Other noncurrent liabilities - (2,447) (4,078) (4,894)
Deferred revenue 106,625 (374,171) 1,110,353 40,023
------------ ------------ ------------ ------------
Net cash provided by operating activities (476,850) 309,114 339,689 232,353
------------ ------------ ------------ ------------
Cash flows from investing activities:
Purchases of fixed assets (328,822) (132,825) (253,662) (198,581)
Proceeds from sale of fixed assets - - - 13,276
Capitalization of software development costs (678,014) (681,223) (1,321,059) (978,724)
Issuance of note receivable 15,000 (25,362) (20,322) (60,000)
------------ ------------ ------------ ------------
Net cash used in investing activities (991,836) (839,410) (1,595,043) (1,224,029)
------------ ------------ ------------ ------------
Cash flows from financing activities:
Borrowings under note payable 1,240,000 428,000 863,000 1,520,000
Payments on note payable - (80,000) (100,000) (1,120,000)
Proceeds from issuance of long-term debt 116,696 195,099 326,549 130,956
Payments on long-term debt (90,341) (42,546) (153,834) (63,303)
Payments on capital lease (17,034) - (8,280) -
Proceeds from issuance of convertible demand notes 133,332 - 366,668 -
Proceeds from issuance of common stock - 150 8,267 -
Proceeds from issuance of preferred stock - - - 500,000
------------ ------------ ------------ ------------
Net cash provided by financing activities 1,382,653 500,703 1,302,370 967,653
------------ ------------ ------------ ------------
Net increase/(decrease) in cash and equivalents (86,033) (29,593) 47,016 (24,023)
Cash and equivalents, beginning of period 89,241 42,225 42,225 66,248
------------ ------------ ------------ ------------
Cash and equivalents, end of period $ 3,208 $ 12,632 $ 89,241 $ 42,225
============ ============ ============ ============
Noncash transactions:
Transfer of inventory to fixed assets $ - $ - $ 53,628 $ 96,446
Borrowings under capital leases - - 192,995 -
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest $ 152,686 $ 35,677 $ 149,118 $ 45,094
The accompanying notes are an integral part of these financial statements.
INTELUS CORPORATION
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
Common Stock Capital in Retained
-------------------------- Excess of Earnings/
Shares Amount Par Value (Deficit)
----------- ----------- ----------- -----------
Balances, December 31, 1992 3,083,310 $ 3,083 $ 630 $ 370,647
Net Income - - - 662,019
----------- ----------- ----------- -----------
Balances, December 31, 1993 3,083,310 3,083 630 1,032,666
Net (loss) - - - (1,052,160)
Stock issued under stock option plans 22,833 23 8,244 -
----------- ----------- ----------- -----------
Balances, December 31, 1994 3,106,143 3,106 8,874 (19,494)
Preferred Stock Dividend Accrued - - - (116,667)
Net (loss) - - - (93,963)
----------- ----------- ----------- -----------
Balances, June 30, 1995 - unaudited 3,106,143 $ 3,106 $ 8,874 $ (230,124)
=========== =========== =========== ===========
The accompanying notes are an integral part of these financial statements.
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
1. Organization
Intelus Corporation (the Company) was incorporated on July 31,
1986, under the laws of the State of Delaware, to acquire and operate a
division of Infocel, Inc. The Company is primarily engaged in the
development, marketing, and maintenance of comprehensive document
management systems using UNIX-based distributed computer networks.
2. Summary of significant accounting policies
Interim financial statements
----------------------------
The interim financial statements are unaudited, but, in the
opinion of management, include all necessary adjustments (which
comprise only normal recurring items) required for a fair presentation
of the financial position as of June 30, 1995 and 1994 and the
results of operations, changes in stockholders' equity and cash
flows for the six months ended June 30, 1995 and 1994.
Revenue recognition
-------------------
The Company's revenues consist primarily of sales of systems and
product and fees for maintenance. Systems and product revenues are
recognized upon shipment of the equipment and acceptance of software
by the customer in accordance with Statement of Position 91-1 Software
Revenue Recognition and Statement of Position 81-1, Accounting for
Performance of Construction-Type and Certain Production-Type
Contracts. Annual maintenance fees are recorded as deferred revenue
at the time of receipt and then recognized ratably over the respective
maintenance period.
Cash and cash equivalents
-------------------------
The Company considers all highly liquid investments with original
maturities of three months or less to be cash equivalents for purposes
of the statement of cash flows.
Inventory
---------
Inventory primarily consists of computer equipment and is valued
at the lower of cost or market. Cost is determined principally on the
average cost method.
continued
8
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
Fixed assets
------------
Fixed assets are stated at cost. Depreciation is computed on the
straight-line method over the estimated useful lives of the related
assets, ranging from 3 to 7 years. Leasehold improvements are
amortized over the term of the lease or the useful life of the
improvements, whichever is less.
At the time of retirement or other disposal of fixed assets, the
cost and related accumulated depreciation are removed from the
accounts and resulting gains or losses are reflected in the statement
of operations.
Software
--------
Purchased software is amortized over useful lives of up to 5
years on a straight-line basis. Amortization expense of $29,371 and
$21,087 was recorded in 1994 and 1993, respectively.
The Company capitalizes software development costs incurred for
new products and product enhancements when technological feasibility
has been established, as evidenced by a working model. Capitalization
ceases when the new product or enhancement is available for general
release to customers, at which time amortization of the capitalized
costs begins and is included in cost of goods sold. Total
amortization expense was $468,092 and $376,688 in 1994 and 1993,
respectively. Capitalized software is amortized on a straight-line
basis over the estimated life of the products, generally three to five
years. Research and development expense, before capitalization of
software development costs, amounted to approximately $1,416,000 and
$1,350,000 for the years ended December 31, 1994, and 1993,
respectively.
continued
9
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
Income taxes
------------
Effective January 1, 1993, the Company adopted SFAS Statement No.
109, Accounting for Income Taxes. Under SFAS 109, deferred tax
liabilities and assets are recognized for the estimated future tax
consequences of temporary differences and income tax credits.
Temporary differences are primarily the result of the differences
between the tax bases of assets and liabilities and their financial
reporting amounts. Deferred tax liabilities and assets are measured
by applying enacted statutory tax rates, applicable to the future
years, in which deferred tax liabilities or assets are expected to be
settled or realized. Valuation allowances are established when
necessary to reduce deferred tax assets to the amount expected to be
realized. Income tax expense consists of the taxes payable for the
current period and the change in deferred tax assets and liabilities
during the period.
Concentration of credit risk
----------------------------
The Company sells its products to various end users in different
industries and geographic locations. The Company's five largest
customers accounted for approximately 37.3% and 30.5% of sales in 1994
and 1993, respectively. Accounts receivable included two diversified
customers whose balances accounted for approximately 37% and 25% of
the outstanding accounts receivable at December 31, 1994 and 1993,
respectively.
3. Property and equipment
Property and equipment consisted of the following:
December 31, 1994 December 31, 1993
----------------- -----------------
Computer equipment $ 638,983 $ 794,932
Furniture and fixtures 86,446 65,691
Office equipment 239,435 48,713
Leasehold improvements 59,269 58,819
---------- ---------
1,024,133 968,155
Less accumulated depreciation (330,281) (547,748)
---------- ---------
$ 693,852 $ 420,407
========== =========
4. Note payable
The Company has a promissory note payable (the Note) under a
Revolving Loan Note agreement with a bank which provides for short-term
borrowings of up to $1,000,000 and a $400,000 unsecured note at the bank's
prime rate plus 1/2%. Borrowings under the Note are limited to 80% of
eligible accounts receivable and 30% of eligible inventory. The Note is
collateralized by substantially all of the Company's assets. Accrued
continued
10
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
interest is due on demand and principal was due in full on May 31, 1993.
The bank extended the Company's due date on the Note until June 30, 1995.
As of December 31, 1994, the Company was in default with respect to several
affirmative covenants, but was granted a waiver for all of them.
On March 28, 1995, the Company received an increase in the
maximum borrowing amount under its Revolving Loan Note Agreement with its
bank. Available short-term borrowings increased to $2,500,000 and were due
and payable on June 30, 1995. Borrowings under the Note were limited to
85% of eligible accounts receivable, 60% of maintenance accounts receivable
(not to exceed $400,000) and 50% against inventory (not to exceed
$250,000). As of March 31, 1995, the Company was in default with respect
to one of the affirmative covenants, for which a waiver was received from
the bank.
On June 22, 1995, the Company received another increase in the
maximum borrowing amount under its Revolving Loan Note Agreement with its
bank. Available short term borrowings are now in the amount of $3,100,000,
and are due and payable on September 30, 1995. Borrowings under the Note
have the same limitations as the March 28, 1995 increase, except for the
addition of 30% of eligible unbilled accounts receivable (not to exceed
$500,000). Interest on the loan is at a floating rate of prime minus 1%.
As of June 30, 1995, the Company was in default with respect to several
affirmative covenants, but was granted a waiver for all of them.
Also, under the terms of the Revolving Loan Note Agreement, there
exists a Fraud Indemnification Agreement ("the Agreement") between the
majority shareholder ("the Indemnitor") and the bank whereby, with respect
to the existence or occurrence of a condition of fraud, as defined in the
Agreement, the Indemnitor agrees to indemnify the bank from any loss, cost
or expense as a result of such a condition, for all obligations between the
Company and the bank.
continued
11
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
5. Long-term debt
The Company has a term loan agreement as part of the Revolving
Loan Note Agreement (see Note 4) with the bank that permits it to borrow up
to $400,000 to purchase equipment. Individual borrowings bear interest at
the bank's prime rate plus 1% and are payable monthly over three years from
the transaction date and are collateralized by the related equipment.
Total borrowings outstanding under this agreement at December 31, 1994 and
1993 amounted to $362,248 and $189,533, respectively.
The aggregate amount of future repayment of the term loan is as
follows:
Year ending
December 31,
------------
1995 $160,212
1996 143,589
1997 58,447
--------
$362,248
========
The Company is subject to certain covenants under its term loan
agreement. Under the most restrictive covenant, the Company is required to
maintain at all times, net worth (as defined) of not less than $1,400,000
which it has met.
continued
12
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
6. Capital lease obligations
During the year the Company entered into 60 month leases for the
purchase of a telephone system and a copier, with interest rates of 5.8%
and 10.9% respectively. Future principal repayments under the lease are as
follows:
1995 $ 48,251
1996 48,251
1997 48,251
1998 48,251
1999 35,486
Less: interest portion (43,775)
--------
Present value of net
minimum lease payments 184,715
Less: current portion (34,452)
--------
$150,263
========
At December 31, 1994, the cost and accumulated depreciation
related to the assets held under capital lease was $192,995 and $9,650,
respectively.
7. Subordinated convertible demand note
During the year, the Company received $366,668 in advances from
its convertible preferred shareholders. The funds were used for working
capital purposes, and are due by November 14, 1995. The advances bear
interest at 8% up to November 14, 1995; 10% interest thereafter. At the
option of the holder, up to one half of the amount advanced is convertible
into common stock of the Company. The conversion price is $1.125/share of
the amount advanced if not repaid by November 14, 1995; $1.53/share if the
amount advanced is repaid by November 14, 1995.
continued
13
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
8. Redeemable convertible preferred stock
On November 30, 1990, the Company completed a private placement
of 1,600,000 shares of its Series 1 convertible preferred stock for an
aggregate amount of $2,000,000. The convertible preferred stock entitles
its holder to certain voting rights; to a cumulative dividend at the rate
of $0.125 per share per annum accruing semi-annually from day to day,
beginning on December 1, 1994 (the Accruing Dividend); to a liquidation
preference over the Company's common stock in an amount equal to $1.25 per
share, plus unpaid Accruing Dividend and any other dividends declared but
unpaid thereon; and to convert at any time, or upon occurrence of certain
events (as defined), into shares of the Company's common stock at $1.25 per
share, subject to certain antidilution adjustments.
The Company is obligated to redeem, on November 30, 1996, 1997
and 1998, one-third of the Series 1 outstanding convertible preferred stock
for the per share amount of $1.25 plus unpaid Accruing Dividend and any
other dividends declared but unpaid thereon.
On June 1, 1993, the Company completed a private placement of
444,445 shares of its Series 2 convertible preferred stock for an aggregate
amount of $500,000. The convertible preferred stock entitles its holders
to certain voting rights; to a cumulative dividend at the rate of $0.1125
per share per annum accruing semi-annually beginning on June 1, 1997 (the
Accruing Dividend); to a liquidation preference over the Company's common
stock in an amount equal to $1.125 per share, plus unpaid Accruing Dividend
and any other dividends declared but unpaid thereon; and to convert at any
time, or upon occurrence of certain events (as defined), into shares of the
Company's common stock at $1.125 per share, subject to certain antidilution
adjustments.
The Company is obligated to redeem, on each June 1, 1999, 2000
and 2001, one-third of the Series 2 outstanding convertible preferred stock
for the per share amount of $1.125 plus unpaid Accruing Dividend and any
other dividends declared but unpaid thereon.
continued
14
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
Additionally, the Company is restricted from repurchasing or
redeeming any of its common stock or from paying dividends on its common
stock without the consent of the majority of the convertible preferred
shareholders.
9. Stock option plan
The 1988 nonqualified stock option plan, as amended, provides for
the granting of options to purchase up to 828,916 shares of common stock to
eligible employees at prices not less than the fair market value of the
common stock on the date of grant. These options normally vest over a five-
year period and generally expire within ten years from the date of grant.
Information regarding this option plan is as follows:
Number of Option Price
Options per Share
--------- ------------
Outstanding, December 31,
1992 240,000 $.05-$.50
Granted 252,000 $.05-$.50
Exercised -
Cancelled (2,000) $.05
-------
Outstanding, December 31,
1993 490,000 $.05-$5.00
Granted 285,000 $.50-$1.00
Exercised (22,833) $.05-$.50
Cancelled (84,667) $.50
Outstanding, December 31, -------
1994 667,500 $.05-$1.00
=======
At December 31, 1994 and 1993, respectively, options for 77,667 and
159,416, shares of common stock remain available for issuance under the
plan.
continued
15
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
10. Commitments and contingencies
The Company currently leases office space under a noncancelable
operating sublease agreement. Future minimum rental commitments under the
sublease agreement are as follows:
December 31
-----------
1995 $281,682
1996 288,291
1997 219,147
--------
$789,120
========
Under the terms of the sublease agreement, the Company is subject
to scheduled annual rent escalation of two percent (2%) of the previous
year's annual rent. The total amount of the base rent payment and the
escalation portion is being charged to expense using the straight-line
method over the term of the lease. In addition, the Company also pays an
allocation of the building's operating expenses. The sublease terminates
on July 31, 1997 with no renewal option.
11. Profit-sharing plan
The Company maintains a defined contribution profit-sharing plan
under Section 401(k) of the Internal Revenue Code (the Plan) which covers
substantially all of its permanent employees.
Pursuant to the Plan, eligible participants may elect to
contribute a percentage of their annual gross compensation and the Company
will contribute certain additional amounts as provided by the Plan. Total
contribution expense for the years ended December 31, 1994 and 1993,
amounted to $23,204 and $18,713, respectively.
continued
16
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
12. Income taxes
The Company adopted SFAS No. 109, "Accounting for Income Taxes",
as of January 1, 1993. As a result of this change in accounting for income
taxes, the financial statements presented have reflected a cumulative
charge against income of $14,832.
The components of the Company's net deferred tax liability are as
follows:
December 31, December 31,
1994 1993
------------- ------------
Non-current deferred tax liability:
Capitalized software costs $ 990,000 $ 707,000
Property and equipment 6,000 -
Non-current deferred tax assets:
Property and equipment - (5,000)
Amounts related to research credits (349,000) (433,000)
Accrued liabilities (31,000) (20,000)
Net operating loss benefit (677,000) -
Accounts receivable (38,000) -
--------- ---------
(99,000) 249,000
Less valuation allowance 349,000 -
--------- ---------
Net deferred tax liability $ 250,000 $ 249,000
========= =========
The types of differences between the tax bases of assets and
liabilities and their financial reporting amounts that give rise to
significant portions of deferred income tax liabilities or assets are
capitalized software costs, fixed assets, allowance for bad debts and
accrued expenses. As of December 31, 1994, the Company has the following
net operating loss and general business credit carry-forwards available:
Net Operating General Business
Expiring Losses Credits
-------- ------------- ----------------
2005 $ - $ 8,000
2006 - 96,000
2007 71,000 95,000
2008 - 150,000
2009 1,713,000 -
---------- --------
$1,784,000 $349,000
========== ========
continued
17
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
The provision for income taxes consists of the following:
Year ended December 31,
1994 1993
----------- ----------
Federal
Current $ - $ -
Deferred (838) -
State
Current $ - $ -
Deferred (157) -
----- ------
$(995) $ -
====== ======
Reconciliations between the statutory federal income tax rate and the
Company's effective income tax rate as a percentage of income (loss) before
provision for income taxes and cumulative effect of accounting change are as
follows:
Year ended December 31,
1994 1993
------------- -----------
Statutory federal income
tax rate (34.0)% 34.0%
Statutory state income tax
rate ( 4.0) 4.0
Permanent differences 3.7 0.0
Change in valuation allowance 33.2 0.0
Other, net 1.2 0.0
Net operating loss 0.0 (38.0)
------ ------
Effective tax rate 0.1% -%
====== ======
The net increase in the valuation allowance from 1993 to 1994 was $349,000.
continued
18
INTELUS CORPORATION
NOTES TO FINANCIAL STATEMENTS
________
13. Subsequent event
Management's plans with regard to the refinancing of the Note payable
to the bank (see Note 4), included alternate financing through several
venture capital sources or a potential merger opportunity. On June 15,
1995, the Company and its majority stockholders signed a letter of intent to
be acquired by merger through the exchange of substantially all of the
Company's outstanding common and preferred shares for shares of the
acquiring entity at the exchange rate equating to a total company valuation
of approximately $23 million.
19
APPENDIX IV
Unaudited Pro Forma Combined Condensed Income Statement Data
The Unaudited Pro Forma Combined Condensed Income Statement Data
assumes that the MACESS Merger, the Renaissance Merger and the Intelus
Merger (collectively, the "Mergers") had occurred on January 1, 1992,
combining the results of SunGard, MACESS, Renaissance and Intelus for
the six months ended June 30, 1995 and 1994 and for each of the three
years in the period ended December 31, 1994, with each of the Mergers
accounted for on a pooling-of-interests basis. The pro forma information
is provided for illustrative purposes only and is not necessarily
indicative of the results of operations that actually would have been
obtained if the Mergers had been effected on the dates indicated or of
the results that may be obtained in the future. Unaudited pro forma
combined condensed balance sheet data as of June 30, 1995 and
December 31, 1994 are not provided herein because the Mergers would not
have had a material effect on SunGard's historical consolidated balance
sheets. During the nine month period ended September 30, 1995, SunGard
has completed five business acquisitions accounted for as purchases. Pro
forma data for these acquisitions are not presented since the financial
condition and results of operations as reported in SunGard's historical
financial statements would not be materially different.
The Unaudited Pro Forma Combined Condensed Income Statement Data
should be read in conjunction with the historical financial statements
and the related notes thereto of SunGard, MACESS, Renaissance and
Intelus, all of which are included or incorporated by reference herein.
Six Months Ended
June 30, Years Ended December 31,
1995 1994 1994 1993 1992
---- ---- ---- ---- ----
Revenues (as reported):
SunGard $246,609 $206,744 $437,190 $381,372 $324,570
MACESS 6,515 5,597 10,315 6,470 1,872
Renaissance/(1)/ 8,156 5,325 12,527 10,271 9,054
Intelus 7,111 3,694 6,965 6,296 4,795
-------- -------- -------- -------- --------
Pro Forma Combined $268,391 $221,360 $466,997 $404,409 $340,291
======== ======== ======== ======== ========
Net income (as reported):
SunGard $23,339 $19,841 $43,087 $38,474/(5)/ $25,808
MACESS 1,061 1,518 2,030 1,108 119
Renaissance/(1)/ 1,923 1,011/(6)/ 2,377 985/(6)/ 1,418
Intelus (94) 144 (1,052) 662 21
------- ------- ------- ------- -------
Pro Forma Combined/(2)/ $26,229 $22,514 $46,442 $41,229 $27,366
======= ======= ======= ======= =======
Fully diluted net income
per common share/(3)/:
SunGard (as reported) $0.61 $0.51 $1.12 $1.04/(5)/ $0.79
===== ===== ===== ===== =====
Pro Forma Combined $0.61 $0.53 $1.08 $1.00 $0.75
===== ===== ===== ===== =====
Shares used to compute fully
diluted net income per
common share:
SunGard (as reported)/(4)/ 38,348 38,534 38,502 38,352 37,982
MACESS 1,990 1,990 1,990 1,990 1,990
Renaissance 1,513 1,513 1,513 1,513 1,513
Intelus 810 810 810 810 810
------ ------ ------ ------ ------
Pro Forma Combined 42,661 42,847 42,815 42,665 42,295
====== ====== ====== ====== ======
/(1)/ The fiscal year of Renaissance ends March 31. For purposes of the pro
forma financial information presented above, the fiscal years ended March
31, 1995, 1994 and 1993 are included in the 1994, 1993 and 1992 columns,
respectively. Interim six month information is presented on a calendar
year basis.
/(2)/ Excludes merger costs which are estimated to be approximately $4.5
million.
/(3)/ Fully diluted net income per common share includes assumed interest
expense savings on convertible subordinated debentures, net of income
taxes, of $1,565 and $4,337 in 1993 and 1992, respectively. The debentures
were converted into common stock of SunGard on May 12, 1993.
/(4)/ All shares have been adjusted for the two-for-one stock split which
occurred in July 1995.
/(5)/ 1993 includes after-tax gain on sale of product line of $3,371, or $0.09
per share on a fully diluted basis.
/(6)/ Includes after-tax charges of $1,150 and $164 during the fiscal year ended
March 31, 1994 and the six months ended June 30, 1994, respectively, in
connection with the settlement of litigation.
SIGNATURE
---------
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.
Date: October 6, 1995
SUNGARD DATA SYSTEMS INC.
By: /s/ Michael J. Ruane
----------------------------
Michael J. Ruane
Vice President-Finance and
Chief Financial Officer
Exhibit Index
-------------
Exhibit Page
- ------- ----
2.1 Agreement and Plan of Reorganization dated September 29, 1995 by and among
SunGard, Newco, MACESS and the Principals.
2.2 Agreement and Plan of Merger dated September 29, 1995 by and among SunGard,
Newco and MACESS.
23.1 Consent of Ernst & Young LLP, independent auditors, regarding
such firm's report on MACESS' audited financial statements.
23.2 Consent of Deloitte & Touche LLP, independent auditors, regarding such
firm's report on Renaissance's audited financial statements.
23.3 Consent of Coopers & Lybrand L.L.P., independent accountants, regarding
such firm's report on Intelus' audited financial statements.
99.1 Press Release dated October 2, 1995 regarding MACESS and Intelus acquisitions.
99.2 Press Release dated September 28, 1995 regarding the Renaissance acquisition.