UNITED STATES
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) December 21, 2005
AFTERSOFT GROUP, INC. f/k/a W3 Group, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-27083 84-1108035
(State or other jurisdiction (Commission (I.R.S. Employer
Of incorporation) File Number) Identification No.)
Savannah House 5th Floor 11Charles II Street
London SW1Y 4AU UK 83728
(Address of principal executive offices) (Zip Code)
60 East 42nd Street, Suite 1163
New York, NY 10165
(Former name or former address if changed since last report)
(Zip Code)
+44 207 451 2468
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Section 1- Registrant's Business and Operations
Item 1.01 Entry into a Material Definitive Agreement.
On December 21, 2005, W3 Group, Inc. (the "Company") consummated an Acquisition
Agreement ("Agreement") to acquire all of the outstanding shares of common stock
of Aftersoft Group, Inc., a Delaware corporation ("Aftersoft") in exchange for
the issuance of 32,500,000 newly issued shares of the Company, par value $.0001
per share (the "Common Stock"), to Auto Data Network, Inc. (ADN), a Delaware
corporation and the sole shareholder of Aftersoft. The Company reported entry
into the Agreement on the Current Report on Form 8-K dated July 22, 2005.
The shares so issued are "restricted shares" and may not be disposed of except
in compliance with an applicable exemption from registration under U.S.
securities laws or pursuant to an effective registration statement under U.S.
securities laws. Pursuant to the Agreement and as a result of consummation of
the Agreement, the current shareholders of the Company own 1,601,167 shares, or
approximately 4.7% of the 34,101,167 total outstanding shares of the Company
Common Stock and ADN owns 32,500,000 shares approximately 95.3% of the total
outstanding shares. .Concurrent with the closing of the transaction, the Board
of Directors of the Company appointed three additional directors designated by
ADN to serve until the next annual election of directors. In addition,
concurrent with the close of the transaction, the Company (1) changed its
corporate name from W3 Group, Inc. to Aftersoft Group, Inc., (2) changed its
corporate address to California, and replaced the Company's corporate officers..
The foregoing summary of the terms and conditions of the Agreement does not
purport to be complete and is qualified in its entirety and incorporated by
reference to the full text of the Agreement filed as Exhibit 10.1 to the Current
Report on Form 8-K dated July 22, 2005.
Section 2 - Financial Information
Item 2.01 Completion of Acquisition or Disposition of Assets.
See the response to Item 1.01 above, which is specifically incorporated herein
by reference. The parties to the Agreement were unrelated third parties prior to
the completion of the Acquisition on December 21, 2005 and the terms thereof
were negotiated on an arms-length basis.
Aftersoft Group is a leading provider of business and supply chain management
solutions primarily to automotive parts manufacturers, retailers, tire and
service chains, independent installers and wholesale distributors in the
automotive aftermarket. The Company conducts its businesses through subsidiaries
with operations in Europe and North America. MAM Software Limited is the leading
supplier of software to the automotive parts market in the U.K. MAM Software
consists of MAM Autopart Ltd, MAM AutoCat Ltd. and MAM Autowork Ltd., which are
all based in Sheffield, UK. Aftersoft Network North America, Inc. is comprised
of AFS Warehouse Distribution Management, Inc. and AFS Tire Management Inc.,
which are based in San Juan Capistrano, California and AFS Autoservice, Inc.,
which is based in Allentown PA. Aftersoft Network North America was formerly
known as CarParts Technologies Acquisition Corp. and AFS Tire Management was
formerly known as CarParts Technologies, Inc. Together these subsidiaries are
the second largest supplier of software to the automotive parts market in the
U.S.
Item 2.02 Results of Operations and Financial Condition.
On December 21, 2005, the Company announced an EBITDA of 14 cents per share and
earning of 9 cents per share (before one time exceptional items) for the fiscal
year ended June 30, 2005 for the combined entity.
Management's Financial Plan of Operation and Financial Statements for the
Company are included in Form 10-SB, which is specifically incorporated in its
entirety herein by reference and attached hereto as Exhibit 99.1. Please see
Exhibit 99.1 for a fuller description of Aftersoft and its businesses as a
result of the transaction.
Section 3- Securities and Trading Market
Item 3.02 Unregistered Sales of Equity Securities.
Pursuant to the terms of the Agreement completed on December 21, 2005, the
Company issued 32,500,000 shares of Common Stock, par value $0.001, to ADN in a
non-public issuance exempt from the registration requirements of the Securities
Act of 1933, as amended, pursuant to Section 4(1), Section 4(6) and/or
Regulation D. The shares so issued are "restricted shares" and may not be
disposed of except in compliance with an applicable exemption from registration
under U.S. securities laws or pursuant to an effective registration statement
under U.S. securities laws.
Section 5- Corporate Governance and Management
Item 5.01 Changes in Control of Company.
Pursuant to the terms of the Agreement, effective December 21, 2005, three
additional directors were appointed to the Company's Board, making a total of
six directors in all. The executive officers of the Company were also replaced.
The names, positions and biographical information of the new management is set
forth in Exhibit 99.1, which is specifically incorporated herein by reference.
Also as a part of the Acquisition, the Registrant issued 32,500,000 shares of
its Common Stock to ADN, which holds 95.3% of the outstanding shares and
therefore has voting control of the Company.
Item 5.02 Departure of Directors or Principal Officers; Election of Directors;
Appointment of Principal Officers
As a part of the Acquisition, Robert Gordon and William C. Hayde resigned as the
officers of the Company, effective December 21, 2005. Mr. Gordon resigned as
President and Mr. Hayde resigned as Secretary. Mssrs. Gordon and Hayde will
remain directors as will the other current director, Joseph J. Messina. The
following three persons were appointed as the principal executive, financial and
operating officers as well as new directors of the Company.
Name Positions
Ian Warwick Chief Executive Officer, President and Director
Mike Jamieson Chief Operating Officer and Director
Michael O'Driscoll Chief Financial Officer and Director
All officers and directors of the Registrant are as set forth in Exhibit 99.1
hereto, which is specially incorporated by reference.
2
The Company intends to form, but doesn't yet have standing audit, nominating and
compensation committees. The Company intends to form those committees
immediately.
Item 5.03 Amendments to Articles of Incorporation or Bylaws.
The Company amended its articles of incorporation on December 21, 2005, to
change its corporate name to Aftersoft Group, Inc. That amendment is filed
herewith as Exhibit 3 (i), and is specifically incorporated herein by reference.
Section 9- Financial Statements and Exhibits.
Item 9.01 Financial Statements and Exhibits.
(a) Financial statements of businesses acquired.
The following financial statements are incorporated by reference to
Exhibit 99.1 to the Current Report on Form 8-K:
Aftersoft Group Inc. Consolidated Financial Statements for fiscal
years ended June 30, 2005 and 2004
Aftersoft Group Inc. Consolidated Financial Statements for the three
months ended September 30, 2005 and 2004
Aftersoft Group Inc. Consolidated Financial Statements as of
December 21, 2005
Aftersoft Group, Inc. Statement of Operations for period from July
1, 2005 to December 21, 2005
(b) Pro forma financial information.
W3 Group, Inc. and Aftersoft Group, Inc. Unaudited pro forma balance
sheet as of June 30, 2005
W3 Group, Inc. and Aftersoft Group, Inc. Unaudited pro forma
condensed combined balance sheet as of September 30, 2005
W3 Group, Inc. and Aftersoft Group, Inc. Unaudited pro forma
consolidated statement of operations for three months ended
September 30, 2005
(d) Exhibits.
The following exhibits are filed as part of this Report on Form 8-K:
Exhibit
Number Description
-------------- ---------------------------------------------------
Exhibit 3 (i) Certificate of Amendment to Certificate of
Incorporation of W3 Group, Inc. :
Exhibit 23.1 Consent of Corbin & Company, LLP
Exhibit 99.1 Aftersoft Group, Inc. Form 10-SB
3
(b) Pro forma financial information
- --------------------------------------------------------------------------------
W3 Group, Inc. and Aftersoft Group, Inc
Unaudited Pro Forma Condensed Combined Balance Sheet
As of June 30, 2005
(In thousands, except loss per share)
Pro Pro
W3 Group, Aftersoft Forma Forma
Inc. Group,Inc. Increase Combined
[Parent] subsidiary] (decrease)
CONDENSED BALANCE SHEET
Current Assets $ -- $ 5,478 $ -- $ 5,478
Property & Equipment, Net -- 521 -- 521
Intangibles -- 27,260 [A] 27,260
Other Long Term Assets -- 36 -- 36
--------------- -------- -------- --------
Total Assets $ -- $ 33,295 $ -- $ 33,295
=============== ======== ======== ========
LIABILITIES & EQUITY
Total Current Liabilities $ -- $ 7,421 $ 40 [B] $ 7,461
Total Liabilities -- 4,370 (98) [A] 4,272
Total Stockholders Equity -- 21,504 58 [B,E, 21,562
D,E]
--------------- -------- -------- --------
Total Liabilities & Equity $ -- $ 33,295 $ -- $ 33,295
=============== ======== ======== ========
CONDENSED STATEMENT OF
OPERATIONS
Revenues $ -- $ 22,062 $-- $ 22,062
Operating costs & expenses -- (19,658) (40) [B,E] (19,698)
Interest and finance charges -- (117) 98 [D] (19)
Provision for income taxes* -- (231) (231)
--------------- -------- -------- --------
Net income / (loss) $ -- $ 2,056 $ 58 $ 2,114
BASIC AND DILUTED NET PROFIT ============== ============ ======== ========
PER COMMON SHARE $0.06
========
WEIGHTED AVERAGE SHARES
OUTSTANDING $ 34,051
========
NOTE 1 - PRO FORMA ADJUSTMENTS
On December 21, 2005, SUBSIDIARY was acquired by PARENT pursuant to an
Agreement signed on July 19, 2005. The agreement called for PARENT to
issue 32,500,000 shares of common stock to the shareholders of SUBSIDIARY
for 100% of the outstanding shares of SUBSIDIARY. The ownership interests
of the former owners of SUBSIDIARY in the combined enterprise will be
approximately 95.4% of the ongoing shareholders of PARENT.
Pro forma adjustments above include the following:
[A] Allocate valuation of goodwill and other intangibles at date of
acquisition.
[B] Add estimated regulatory compliance costs.
[C] Issue 32,500,000 shares of common stock and eliminate equity accounts
of SUBSIDIARY.
[D] Loan interest payable to related party
[E] Amortization of the valuation of certain intangible assets at date of
acquisition which do not effect future operations.
NOTE 2 - PRO FORMA PROFIT PER SHARE
Pro forma profit per share is computed based on the number of shares
outstanding, as though all Common Stock had been issued at the beginning
of the period.
4
W3 Group, Inc. and Aftersoft Group, Inc
Unaudited Pro Forma Condensed Combined Balance Sheet
As of September 30, 2005
(In thousands, except loss per share)
W3
Group, Aftersoft Pro Forma Pro
Inc. Group, Inc. Increase Forma
[Parent] [subsidiary] (decrease) Combined
CONDENSED BALANCE SHEET
Current Assets $ -- $ 5,656 $ -- $ 5,656
Property & Equipment, Net -- 468 -- 468
Intangibles -- 27,152 [A] 27,152
Other Long Term Assets -- 39 -- 39
--------- -------- -------- --------
Total Assets $ -- $ 33,314 $ -- $ 33,314
LIABILITIES & EQUITY
Total Current Liabilities $ -- 7,624 $ 40 [B] $ 7,664
Total Liabilities -- 4,277 (98) [A] 4,179
Total Stockholders Equity -- 21,413 58 [B,E,D,E] 21,471
--------- -------- -------- --------
Total Liabilities & Equity $ -- 33,314 $ -- $ 33,314
========= ======== ======== ========
CONDENSED STATEMENT OF OPERATIONS
Revenues -- 4,779 $ -- $ 4,779
Operating costs & expenses -- (4,829) (40) [B,E] (4,869)
Interest and finance charges -- (31) 98 [D] 67
--------- -------- -------- --------
Net income / (loss) -- (82) 58 (24)
========= ======== ======== ========
BASIC AND DILUTED NET PROFIT PER COMMON SHARE $ 0.00
========
WEIGHTED AVERAGE SHARES OUTSTANDING $ 34,051
======== ========
NOTE 1 - PRO FORMA ADJUSTMENTS
On December 21, 2005, SUBSIDIARY was acquired by PARENT pursuant to an
Agreement signed on July 19, 2005. The agreement called for PARENT to
issue 32,500,000 shares of common stock to the shareholders of SUBSIDIARY
for 100% of the outstanding shares of SUBSIDIARY. The ownership interests
of the former owners of SUBSIDIARY in the combined enterprise will be
approximately 95.4% of the ongoing shareholders of PARENT.
Pro forma adjustments above include the following:
[A] Allocate valuation of goodwill and other intangibles at date of
acquisition.
[B] Add estimated regulatory compliance costs.
[C] Issue 32,500,000 shares of common stock and eliminate equity accounts
of SUBSIDIARY.
[D] Loan interest payable to related party
[E] Amortization of the valuation of certain intangible assets at date of
acquisition which do not effect future operations.
NOTE 2 - PRO FORMA PROFIT PER SHARE
Pro forma profit per share is computed based on the number of shares
outstanding, as though all Common Stock had been issued at the beginning
of the period.
5
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.
WE AFTERSOFT GROUP, INC.[f/k/a W3 Group, Inc.]
By /s/ Ian Warwick
------------------------------------
Ian Warwick
Chief Executive and President
Date: December [28], 2005
6
The following financial statements are incorporated by reference to Exhibit 99.1
to the Current Report on Form 8-K:
Aftersoft Group, Inc. Consolidated Financial Statements for fiscal years ended
June 30, 2005 and 2004
Aftersoft Group, Inc. Consolidated Financial Statements for the three months
ended September 30, 2005 and 2004
Aftersoft Group, Inc. Consolidated Financial Statements as of December 21, 2005
Aftersoft Group, Inc. Statement of Operations for Aftersoft Group, Inc. for the
period July 1, 2005 to December 21, 2005
Exhibits Table
Exhibit Number
3(i) Certificate of Amendment to Certificate of Incorporation of W3 Group
23.1 Consent of Corbin & Company, LLP
99.1 Aftersoft Group, Inc. Form 10-SB
7