-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, F6dkASzAlA0jZaeNAIcco1x4iJQ1OxTlKUnXnLOIC2/elbhWKw2Q/NUo2dvbzTmz fA8ahAeGZnWAq+/T6/Xq0w== 0000931763-98-003157.txt : 19981214 0000931763-98-003157.hdr.sgml : 19981214 ACCESSION NUMBER: 0000931763-98-003157 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19980930 ITEM INFORMATION: FILED AS OF DATE: 19981211 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERCEPT GROUP INC CENTRAL INDEX KEY: 0001054930 STANDARD INDUSTRIAL CLASSIFICATION: FUNCTIONS RELATED TO DEPOSITORY BANKING, NEC [6099] IRS NUMBER: 582237359 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 001-14213 FILM NUMBER: 98768363 BUSINESS ADDRESS: STREET 1: 3150 HOLCOMB BRIDGE ROAD SUITE 200 CITY: NORTCROSS STATE: GA ZIP: 30071 BUSINESS PHONE: 7702489600 MAIL ADDRESS: STREET 1: 3150 HOLCOMB BRIDGE ROAD SUITE 200 CITY: NORTCROSS STATE: GA ZIP: 30071 8-K/A 1 THE INTERCEPT GROUP, INC. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ----------------- FORM 8-K/A AMENDMENT NO. 1 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 30, 1998 ---------------------- THE INTERCEPT GROUP, INC. ------------------------- (Exact Name of Registrant as Specified in its Charter) Georgia 01-14213 58-2237359 ----------------- ----------- ------------------ (State or Other (Commission (I.R.S. Employer Jurisdiction of File Number) Identification No.) Incorporation) 3150 Holcomb Bridge Road, Suite 200, Norcross, Georgia 30071 - ----------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (770) 248-9600 -------------- N/A ------------------------------------ (Former Name or Former Address, if Changed Since Last Report) ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. The registrant hereby amends its report on Form 8-K filed on October 14, 1998 by deleting the text under Item 7 and replacing it with the following text. (A) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED. Included as Exhibits 99.2 hereto and incorporated herein by reference. (B) PRO FORMA FINANCIAL INFORMATION. Included as Exhibit 99.3 hereto and incorporated herein by reference. (C) EXHIBITS. 2.1 Asset Purchase Agreement dated September 30, 1998 by and between ProVesa, Inc., a wholly owned subsidiary of The InterCept Group, Inc. ("InterCept"), Mercantile Corporation ("Mercantile"), and Dale May.* 99.1 Press Release dated September 30, 1998.* 99.2 The following audited financial statements of Advance Data together with the report thereon by Arthur Andersen LLP: Balance Sheets as of December 31, 1996 and 1997 and July 31, 1998 (unaudited). Statements of Operations for the years ended December 31, 1996 and 1997 and the seven months ended July 31, 1998 (unaudited). Statements of Partners' Capital for the years ended December 31, 1996 and 1997 and the seven months ended July 31, 1998 (unaudited). Statements of Cash Flows for the years ended December 31, 1996 and 1997 and the seven months ended July 31, 1998 (unaudited). Notes to Financial Statements. 99.3 The following unaudited pro forma condensed consolidated financial statements of InterCept and Advance Data: Pro Forma Condensed Consolidated Statement of Operations for the year ended December 31, 1997. Pro Forma Condensed Consolidated Statement of Operations for the nine months ended September 30, 1998. Notes to Pro Forma Condensed Consolidated Financial Information. - --------- *Previously filed with the registrant's Current Report on Form 8-K filed October 14, 1998. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. THE INTERCEPT GROUP, INC. By: /s/ Scott R. Meyerhoff ----------------------------------------- Scott R. Meyerhoff Chief Financial Officer Dated: December 11, 1998 EXHIBIT INDEX Exhibit Page - ------- ---- 2.1 Asset Purchase Agreement dated September 30, 1998 by and between Provesa,Inc., a wholly owned subsidiary of The InterCept Group, Inc. ("InterCept") Mercantile Corporation ("Mercantile"), and Dale May.* 99.1 Press Release dated September 30, 1998.* 99.2 The following audited financial statements of Advance Data together with the report thereon by Arthur Andersen LLP: Balance Sheets as of December 31, 1996 and 1997 and July 31, 1998 (unaudited). Statements of Operations for the years ended December 31, 1996 and 1997 and the seven months ended July 31, 1998 (unaudited). Statements of Partners' Capital for the years ended December 31, 1996 and 1997 and the seven months ended July 31, 1998 (unaudited). Statements of Cash Flows for the years ended December 31, 1996 and 1997 and the seven months ended July 31, 1998 (unaudited). Notes to Financial Statements. 99.3 The following unaudited pro forma condensed consolidated financial statements of InterCept and Advance Data: Pro Forma Condensed Consolidated Statement of Operations for the year ended December 31, 1997. Pro Forma Condensed Consolidated Statement of Operations for the nine months ended September 30, 1998. Notes to Pro Forma Condensed Consolidated Financial Information. - --------- *Previously filed with the registrant's Current Report on Form 8-K filed October 14, 1998. EX-99.2 2 AUDITED FINANCIAL STATEMENTS OF ADVANCE DATA EXHIBIT 99.2 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Partners of Advance Data Partnership: We have audited the accompanying balance sheets of ADVANCE DATA PARTNERSHIP (an Arkansas general partnership) as of December 31, 1996 and 1997 and the related statements of operations, partners' capital 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 Advance Data Partnership as of December 31, 1996 and 1997 and the results of its operations and its cash flows for the years then ended in conformity with generally accepted accounting principles. Atlanta, Georgia November 20, 1998 ADVANCE DATA PARTNERSHIP BALANCE SHEETS DECEMBER 31, 1996 AND 1997 AND JULY 31, 1998 (UNAUDITED) ASSETS 1996 1997 1998 -------- -------- -------- (Unaudited) CURRENT ASSETS: Cash $116,697 $405,789 $244,672 Accounts receivable 122,005 137,488 142,835 Other current assets 12,140 10,324 28,533 -------- -------- -------- Total current assets 250,842 553,601 416,040 PROPERTY AND EQUIPMENT, NET 545,669 441,688 492,407 -------- -------- -------- $796,511 $995,289 $908,447 ======== ======== ======== LIABILITIES AND PARTNERS' CAPITAL CURRENT LIABILITIES: Current maturities of long-term debt $175,000 $210,510 $ 0 Accounts payable 99,791 6,789 246,186 -------- -------- -------- Total current liabilities 274,791 217,299 246,186 COMMITMENTS AND CONTINGENCIES PARTNERS' CAPITAL 521,720 777,990 662,261 -------- -------- -------- $796,511 $995,289 $908,447 ======== ======== ======== The accompanying notes are an integral part of these balance sheets. ADVANCE DATA PARTNERSHIP STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1997 AND THE SEVEN MONTHS ENDED JULY 31, 1998 (UNAUDITED) 1996 1997 1998 ---------- ---------- -------- (Unaudited) REVENUES $1,038,632 $1,224,020 $892,889 ---------- ---------- -------- COSTS AND EXPENSES: Cost of services 305,140 289,376 189,716 Selling, general, and administrative 499,503 537,948 474,764 Depreciation and amortization 95,552 126,809 74,577 ---------- ---------- -------- OPERATING INCOME 138,437 269,887 153,832 OTHER (EXPENSE) INCOME, NET 1,456 (13,617) (2,236) ---------- ---------- -------- INCOME BEFORE PRO FORMA INCOME TAX PROVISION 139,893 256,270 151,596 PRO FORMA INCOME TAX PROVISION 53,159 97,384 57,606 ---------- ---------- -------- NET INCOME $ 86,734 $ 158,886 $ 93,990 ========== ========== ======== The accompanying notes are an integral part of these statements. ADVANCE DATA PARTNERSHIP STATEMENTS OF PARTNERS' CAPITAL FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1997 AND THE SEVEN MONTHS ENDED JULY 31, 1998 BALANCE, DECEMBER 31, 1995 $ 381,827 Net income 86,734 Pro forma income tax provision 53,159 --------- BALANCE, DECEMBER 31, 1996 521,720 Net income 158,886 Pro forma income tax provision 97,384 --------- BALANCE, DECEMBER 31, 1997 777,990 Net income (unaudited) 93,990 Pro forma income tax provision (unaudited) 57,606 Partnership distribution (unaudited) (267,325) --------- BALANCE, July 31, 1998 (unaudited) $ 662,261 ========= The accompanying notes are an integral part of these statements. ADVANCE DATA PARTNERSHIP STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1997 AND THE SEVEN MONTHS ENDED JULY 31, 1998
1996 1997 1998 --------- -------- --------- (Unaudited) CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 86,734 $158,886 $ 93,990 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 95,552 126,809 74,577 Pro forma income tax provision 53,159 97,384 57,606 Changes in current assets and liabilities: Accounts receivable (35,555) (15,483) (5,347) Other current assets (5,734) 1,816 (18,209) Accounts payable and accrued liabilities 93,356 (93,002) 239,397 --------- -------- --------- Net cash provided by operating activities 287,512 276,410 442,014 --------- -------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment, net (464,084) (22,828) (125,296) --------- -------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Partnership distributions 0 0 (267,325) Proceeds from long-term debt 320,678 70,000 0 Payments on long-term debt (145,678) (34,490) (210,510) --------- -------- --------- Net cash provided by (used in) financing activities 175,000 35,510 (477,835) --------- -------- --------- NET (DECREASE) INCREASE IN CASH (1,572) 289,092 (161,117) CASH, beginning of period 118,269 116,697 405,789 --------- -------- --------- CASH, end of period $ 116,697 $405,789 $ 244,672 ========= ======== ========= SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid for interest $ 4,226 $ 19,613 $ 5,408 ========= ======== =========
The accompanying notes are an integral part of these statements. ADVANCE DATA PARTNERSHIP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1997 AND JULY 31, 1998 (UNAUDITED) 1. ORGANIZATION AND NATURE OF BUSINESS Advance Data Partnership ("Advance Data" or the "Company") (an Arkansas general partnership) was established for the purpose of providing core data processing, check imaging, and item capture services to financial institutions, primarily community banks. Certain assets and liabilities of the data processing business are being acquired in a transaction accounted for as a purchase by The InterCept Group, Inc. ("InterCept") (Note 11). The partnership interests at inception were as follows: Mercantile Corporation 48% First Processing Services, Inc. 52% The partnership agreement stipulated that all partnership income and losses would be allocated directly in proportion to the ownership percentages. On December 31, 1997, Mercantile Corporation purchased an additional 4% of the partnership from First Processing Services, Inc. for total consideration of $31,200. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES STATEMENTS OF CASH FLOWS For the purposes of the statement of cash flows, short-term investments with maturities of three months or less are considered to be cash equivalents. USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The interim financial information is unaudited. However, in the opinion of management, the interim financial data includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results for the interim periods. PROPERTY AND EQUIPMENT Property and equipment are recorded at cost at the acquisition date. The Company provides for depreciation using the straight-line method over the estimated useful lives of the assets. Repair and maintenance costs are expensed, and major betterments are capitalized. Property, plant, and equipment consisted of the following at December 31, 1996 and 1997 and July 31, 1998:
Useful Life 1996 1997 1998 ----------- ---------- ---------- ---------- (Unaudited) Leasehold improvements Five years $ 99,154 $ 99,154 $ 99,154 Machinery and equipment Five years 726,375 743,048 864,351 Furniture and fixtures Five years 90,869 90,869 94,862 Software Five years 134,021 140,175 140,175 ---------- ---------- ---------- 1,050,419 1,073,246 1,198,542 Less accumulated depreciation (504,750) (631,558) (706,135) ---------- ---------- ---------- $ 545,669 $ 441,688 $ 492,407 ========== ========== ==========
COMPUTER SOFTWARE Acquired software and licensing rights are capitalized and amortized using the straight-line method over an estimated useful life of five years. REVENUE RECOGNITION Revenues are derived primarily from service fees and are recognized as services are performed. 4. LONG-TERM DEBT Long-term debt consisted of the following at December 31, 1996 and 1997 and July 31, 1998:
1996 1997 1998 --------- --------- ----- (Unaudited) Revolving note payable to First Bank of Arkansas for borrowings of up to $245,000, payable on demand, or if no demand is made, interest payable at 9% in monthly principal and interest payments of $6,111 through April 10, 1999, paid in full subsequent to December 31, 1997 $ 175,000 $ 210,510 $ 0 Less current portion (175,000) (210,510) 0 --------- --------- ----- Long-term debt, net of current portion $ 0 $ 0 $ 0 ========= ========= =====
5. INCOME TAXES The Company is a partnership for federal and state income tax reporting purposes. As such, taxable income and loss of the Company are included in the partners' tax returns. The statements of operations reflect pro forma income taxes of $53,159, $97,384, and $57,606 for the years ended December 31, 1996 and 1997 and the seven months ended July 31, 1998, respectively as if the Company were subject to income tax. The difference between the pro forma income tax -2- provision and the amount computed by applying the statutory federal income tax rate to the net income for the period is due to nondeductible expenses incurred during each period. The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases are not material. 6. EMPLOYEE BENEFITS The Company has a defined contribution 401(k) benefit plan which covers substantially all employees, subject to certain minimum age and service requirements. The plan provides for voluntary contributions by employees and matching contributions by the Company at its discretion. For the years ended December 31, 1996 and 1997, the Company made no contributions to the plan. 7. COMMITMENTS Advance Data leases certain equipment and facilities under operating leases. Future minimum payments on these leases at December 31, 1997 are approximately as follows: 1998 $ 44,000 1999 42,000 2000 42,000 2001 3,500 -------- $131,500 ======== Rent expense for all operating leases was approximately $42,000 and $44,000 for the years ended December 31, 1996 and 1997, respectively. 8. CUSTOMER CONCENTRATION Certain customers made up more than 10% of the Company's sales as of December 31, 1996 and 1997, as follows: 1996 1997 ---- ---- Customer A 37.8% 45.5% Customer B 12.4 14.7 Customer C N/A 11.6 9. FAIR VALUE OF FINANCIAL INSTRUMENTS Advance Data is required to disclose fair value information about financial instruments, whether or not they are recognized on the balance sheet, for which it is practicable to estimate that value. The assumptions used in the estimation of the fair value of the Company's financial instruments are detailed below. Where quoted prices are not available, fair values are based on estimates using discounted cash flows and other valuation techniques. The use of discounted cash flows can be significantly affected by the assumptions used, including the discount rate and estimates of future -3- cash flows. The following disclosures should not be considered a surrogate of the liquidation value of the Company, but rather a good faith estimate of the increase or decrease in value of financial instruments held by the Company since purchase, organization, or issuance. CASH AND CASH EQUIVALENTS For cash, the carrying value amount is a reasonable estimate of fair value. LONG-TERM DEBT The carrying amount of the variable rate long-term debt approximates the fair value. LIMITATIONS Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale, at one time, the Company's entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Company's financial instruments, fair value estimates are based on many judgments. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing on- and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Significant assets and liabilities that are not considered financial instruments include deferred income taxes and property and equipment. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates. 10. RELATED-PARTY TRANSACTIONS Revenues of $392,280, $556,911, and $358,626 for the years ended December 31, 1996 and 1997 and the seven-month period ended July 31, 1998, respectively, were received from First Bank of Arkansas-Jonesboro, an entity affiliated with First Processing Services, Inc. through common ownership. Accounts receivable as of December 31, 1996 and 1997, and July 31, 1998 included $43,616, $52,982, and $50,004, respectively, due from First Bank of Arkansas-Jonesboro. Management and administrative services were performed for the Company by the sole shareholder of Mercantile Corporation for a salary of $62,200, $77,692, and $58,200 for the years ended December 31, 1996 and 1997 and the seven- month period ended July 31, 1998, respectively. 11. SUBSEQUENT EVENT On September 30, 1998, InterCept entered into an asset purchase agreement with Mercantile Corporation to purchase certain of the assets for a purchase price of approximately $1,100,000. In connection with this transaction, First Processing Services, Inc. conveyed its remaining 48% interest in the Company to Mercantile Corporation as consideration for the cancellation of a contract requiring it to use the Company's services. The acquired assets consisted primarily of accounts receivable, computer equipment, and various other assets. -4- EX-99.3 3 UNAUDITED PRO FORMA FINANCIAL STATEMENTS EXHIBIT 99.3 The InterCept Group, Inc. Unaudited Pro Forma Condensed Consolidated Statement of Operations For the Year Ended December 31, 1997
(a) (b) Historical Advance Data Pro Forma Pro Forma Consolidated Partnership Eliminations Consolidated ------------ ------------ ------------ ------------ Revenues $23,260,082 $1,224,020 $ 0 $24,484,102 Cost of services 10,222,651 289,376 0 10,512,027 Selling, general and administrative expense 10,105,317 537,948 0 10,643,265 Depreciation and amortization 1,323,771 126,809 28,800 (c) 1,479,380 Loss on impairment of intangibles 727,500 0 0 727,500 Writeoff of purchased research and development cost 0 0 0 0 ----------- ---------- -------- ----------- Total operating expense 22,379,239 954,133 28,800 23,362,172 ----------- ---------- -------- ----------- Operating Income 880,843 269,887 (28,800) 1,121,930 Interest expense (770,175) (13,617) 0 (783,792) Interest and other income, net 121,535 0 (55,000) (d) 66,535 ----------- ---------- -------- ----------- Income before provision for income taxes and minority interest 232,203 256,270 (83,800) 404,673 Provision for income taxes 666,125 97,384 0 763,509 Minority interest 38,564 0 0 38,564 ----------- ---------- -------- ----------- Net loss before preferred dividends (395,358) 158,886 (83,800) (320,272) Preferred dividends (32,000) 0 0 (32,000) ----------- ---------- -------- ----------- Net loss attributable to common shareholders $ (427,358) $ 158,886 $(83,800) $ (352,272) =========== ========== ======== =========== Pro Forma net loss attributable to common shareholders $ (0.06) $ (0.05) =========== ============ Pro forma weighted average common and common equivalent shares outstanding 6,750,114 6,750,114 =========== ============
- -------------- (a) Represents the historical consolidated statement of operations of InterCept for the year ended December 31, 1997 contained in the Company's Registration Statement on Form S-1 (Registration No. 333-47197) as declared effective by the Securities and Exchange Commission on June 9, 1998. (b) Represents the historical statement of operations of Advance Data Partnership ("Advance Data") for the year ended December 31, 1997 included herein. (c) Reflects the amortization of intangibles related to the acquisition of Advance Data as if it had occurred on January 1, 1997. (d) Reflects the reduction in interest income related to the acquisition of Advance Data as if it had occurred on January 1, 1997 due to the use of cash to fund the acquisition. The InterCept Group, Inc. Unaudited Pro Forma Condensed Consolidated Statement of Operations For the Nine Months Ended September 30, 1998
(a) (b) Historical Advance Data Pro Forma Pro Forma Consolidated Partnership Eliminations Consolidated ------------ ------------ ------------ ------------ Revenues $20,483,133 $892,889 $ 0 $21,376,022 Cost of services 8,635,678 189,716 0 8,825,394 Selling, general and administrative expense 7,896,546 474,764 0 8,371,310 Depreciation and amortization 961,551 74,577 16,800 (c) 1,052,928 Loss on impairment of intangibles 0 0 0 0 Writeoff of purchased research and development costs 0 0 0 0 ----------- -------- -------- ----------- Total operating expense 17,493,775 739,057 16,800 18,249,632 ----------- -------- -------- ----------- 0 Operating Income 2,989,358 153,832 (16,800) 3,126,390 Interest expense (329,080) (2,236) 0 (331,316) Interest and other income, net 118,844 0 (32,000) (d) 86,844 ----------- -------- -------- ----------- Income before provision for income taxes and minority interest 2,779,122 151,596 (48,800) 2,881,918 Provision for income taxes 1,076,315 57,606 0 1,133,921 Minority interest (79,886) 0 0 (79,886) ----------- -------- -------- ----------- Net loss before preferred dividends 1,622,921 93,990 (48,800) 1,668,111 Preferred dividends (16,000) 0 0 (16,000) ----------- -------- -------- ----------- Net loss attributable to common shareholders $ 1,606,921 $ 93,990 $(48,800) $ 1,652,111 =========== ======== ======== =========== Pro Forma net loss attributable to common shareholders $ 0.20 $ 0.21 =========== =========== Pro forma weighted average common and common equivalent shares outstanding 7,866,960 7,866,960 =========== ===========
- -------------- (a) Represents the historical unaudited consolidated statement of operations of InterCept for the nine months ended September 30, 1998 contained in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1998. (b) Represents the historical unaudited statement of operations of Advance Data Partnership ("Advance Data") for the seven months ended July 31, 1998 included herein. (c) Reflects the amortization of intangibles related to the acquisition of Advance Data as if it had occurred on January 1, 1998. (d) Reflects the reduction in interest income related to the acquisition of Advance Data as if it had occurred on January 1, 1998 due to the use of cash to fund the acquisition. -----END PRIVACY-ENHANCED MESSAGE-----