-----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, KK0WT0/91bcdVOXKrqnfg/s9OJ24Gic3U9l/wWXnoIzDdTY8E38CF0QxAfud06+7 vqOLTvlHXfCL1ruvSuR2zw== /in/edgar/work/20000814/0000930661-00-002031/0000930661-00-002031.txt : 20000921 0000930661-00-002031.hdr.sgml : 20000921 ACCESSION NUMBER: 0000930661-00-002031 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LOISLAW COM INC CENTRAL INDEX KEY: 0001088820 STANDARD INDUSTRIAL CLASSIFICATION: [7370 ] IRS NUMBER: 710655999 STATE OF INCORPORATION: AR FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-27463 FILM NUMBER: 697433 BUSINESS ADDRESS: STREET 1: 105 NORTH 28TH STREET CITY: VAN BUREN STATE: AR ZIP: 72956 BUSINESS PHONE: 5014715581 MAIL ADDRESS: STREET 1: 105 NORTH 28TH STREET CITY: VAN BUREN STATE: AK ZIP: 72956 10-Q 1 0001.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2000. OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES exchange act of 1934 For the transition period from ______ to ______ . Commission file number 0-27463 Loislaw.com, Inc. - ------------------------------------------------------------------------------- (Exact name of Registrant as specified in its charter) Delaware 71-0655999 - ---------------------------------------- ----------------------------------- (State or other jurisdiction of (IRS Employer Identification No.) incorporation or organization) 105 North 28th Street Van Buren, Arkansas 72956 - ---------------------------------------- ----------------------------------- (Address of principal executive offices) (Zip Code) (501) 471-5581 - ------------------------------------------------------------------------------- Registrant's telephone number, including area code Not applicable - ------------------------------------------------------------------------------- Former name, address and former fiscal year, if changed since last report. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 21,038,497 shares of common stock, $.001 par value, were outstanding on August 3, 2000. INDEX LOISLAW.COM, INC.
PART I. FINANCIAL INFORMATION - ------------------------------ Item 1. Financial Statements Page - ------- ---- Condensed Balance Sheets -- June 30, 2000 (unaudited) and December 31, 1999 3 Unaudited Condensed Statements of Operations - Three months and six months ended June 30, 2000 and 1999 4 Unaudited Condensed Statements of Cash Flows -- Six months ended March 31, 2000 and 1999 5 Notes to Unaudited Condensed Financial Statements -- June 30, 2000 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results - ------- of Operations 7 Item 3. Quantitative and Qualitative Disclosures about Market Risk 12 - ------- PART II. OTHER INFORMATION - --------------------------- Item 4. Submission of Matters to a Vote of Security Holders 13 - ------- Item 5. Other Information 13 - ------ Item 6. Exhibits and Reports on Form 8-K 13 - -------
Page 2 PART I. FINANCIAL INFORMATION Item 1. Financial Statements - ------- LOISLAW.COM, INC. CONDENSED BALANCE SHEETS
June 30, December 31, 2000 1999 ------------ ------------ ASSETS (unaudited) (see note) Current assets: Cash and cash equivalents $ 8,214,425 $ 19,286,007 Accounts receivable, net 5,754,646 4,052,088 Prepaid commissions 1,456,726 1,454,797 Prepaid software license 305,588 296,125 Other current assets 565,879 650,843 ------------ ------------ Total current assets 16,297,264 25,739,860 Databases, net 19,686,981 16,585,088 Property and equipment, net 4,532,065 3,803,122 Other assets 269,188 444,985 ------------ ------------ Total assets $ 40,785,498 $ 46,573,055 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current installments of long-term debt $ 200,620 $ 13,060 Accounts payable 3,716,142 2,580,284 Deferred revenues 6,923,467 6,003,521 Accrued expenses 1,555,468 1,716,435 ------------ ------------ Total current liabilities 12,395,697 10,313,300 Deferred revenues 23,386 222,504 Long-term debt, excluding current installments 386,065 9,405 ------------ ------------ Total liabilities 12,805,148 10,545,209 ============ ============ Stockholders' equity : Common stock, $.001 par value. 50,000,000 shares authorized; 21,048,497 shares issued at March 31, 2000 and 20,952,003 shares issued at December 31, 1999 21,048 20,952 Additional paid-in capital 74,164,843 73,847,856 Accumulated deficit (46,189,441) (37,824,862) Treasury stock, at cost, 10,000 shares (16,100) (16,100) ------------ ------------ Total stockholders' equity 27,980,350 36,027,846 ------------ ------------ Total liabilities and stockholders' equity $ 40,785,498 $ 46,573,055 ============ ============
See notes to accompanying unaudited condensed financial statements. Page 3 LOISLAW.COM, INC. UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended June 30, June 30, ---------------------------- ---------------------------- 2000 1999 2000 1999 ----------- ----------- ----------- ----------- Revenues: Subscriptions $ 3,374,437 $ 1,481,491 $ 6,219,466 $ 2,792,372 Other 10,153 - 10,153 - ----------- ----------- ----------- ----------- Total revenues 3,384,590 1,481,491 6,229,619 2,792,372 Operating expenses: Database costs 1,861,598 1,569,418 3,752,330 2,704,417 Selling and marketing 3,902,273 2,580,449 7,984,236 4,320,448 General and administrative 1,376,005 936,032 3,073,826 1,708,179 Product development 49,463 117,864 163,071 333,075 ----------- ----------- ----------- ----------- Total operating expenses 7,189,339 5,203,763 14,973,463 9,066,119 ----------- ----------- ----------- ----------- Loss from operations (3,804,749) (3,722,272) (8,743,844) (6,273,747) Other income (expense): Interest income 152,789 23,469 387,497 29,811 Interest expense (8,594) (738,438) (9,022) (1,338,489) Other, net 788 3,982 788 5,485 ----------- ----------- ----------- ----------- Total other income (expense) 144,983 (710,987) 379,263 (1,303,193) ----------- ----------- ----------- ----------- Net loss (3,659,766) (4,433,259) (8,364,581) (7,576,940) Accrued preferred stock dividends and accretion on redeemable preferred stock and common warrants - 256,348 - 462,079 ----------- ----------- ----------- ----------- Net loss applicable to common stock $(3,659,766) $(4,689,607) $(8,364,581) (8,039,019) =========== =========== =========== =========== Net loss per share - basic and diluted $(0.17) $(0.52) $(0.40) $(0.95) =========== =========== =========== =========== Weighted average common shares outstanding - basic and diluted 20,982,121 8,969,234 20,972,584 8,424,298 ----------- ----------- ----------- -----------
See notes to accompanying unaudited condensed financial statements. Page 4 LOISLAW.COM, INC. UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended June 30, ---------------------------------- 2000 1999 ------------ ----------- Operating activities: Net loss $ (8,364,581) $(7,576,940) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation and amortization 1,667,122 1,411,375 Changes in operating assets and liabilities: Receivables (1,702,558) 40,852 Prepaid expenses and other current assets 73,574 (1,103,457) Accounts payable 1,135,858 1,192,307 Accrued expenses (160,967) 96,312 Deferred revenue 720,828 78,109 ------------ ----------- Net cash used by operating activities (6,630,724) (5,861,442) Investing activities: Database production expenditures (4,351,632) (5,737,218) Purchase of property and equipment (1,146,326) (1,668,324) (Increase) decrease in other assets 175,797 (222,141) ------------ ----------- Net cash used by investing activities (5,322,161) (7,627,683) Financing activities: Proceeds from notes payable 600,000 9,362,500 Proceeds from sale of common stock 317,083 478,485 Proceeds from sale of Series C convertible preferred stock, net of issuance costs of $624,023 - 8,893,850 Deferred loan costs - (13,273) Repayment of notes payable (29,380) (2,050,623) Repayment of capital lease obligations (6,400) (5,910) ------------ ----------- Net cash provided by financing activities 881,303 16,665,029 (Decrease) Increase in cash and cash equivalents (11,071,582) 3,175,904 Cash and cash equivalents at beginning of period 19,286,007 99,042 ------------ ----------- Cash and cash equivalents at end of period $ 8,214,425 $ 3,274,946 ============ =========== Supplemental cash flow information: Cash paid for interest $ 9,022 $ 1,176,070 Noncash investing and financing transactions: Accrued Series B redeemable preferred stock dividends - $ 169,777 Accretion on redeemable equity securities - $ 372,774 Issuance of warrants - $ 408,364 Cancellation of redemption feature on redeemable common stock - $ 1,233,746 Conversion of subordinated notes payable to 857,509 shares of Series C convertible preferred stock - $ 4,982,127 Exercise of warrants for satisfaction of subordinated notes payable - $ 10,566
See notes to accompanying unaudited condensed financial statements. Page 5 LOISLAW.COM, INC. NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS June 30, 2000 NOTE A--BASIS OF PRESENTATION The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six-month period ended June 30, 2000 are not necessarily indicative of the results that may be expected for the year ending December 31, 2000. For further information, refer to the financial statements and notes thereto included in the annual report on Form 10-K of Loislaw.com, Inc. (the "Company" or "Loislaw.com") for the year ended December 31, 1999. NOTE B--CONTINGENCIES The Company is involved in certain claims and pending litigation arising from the normal conduct of business. Based on the present knowledge of the facts, management believes the resolution of these claims and pending litigation will not have a material adverse effect on the financial position, results of operations or liquidity of the Company. Page 6 FORM 10-Q LOISLAW.COM, INC. Item 2. Management's Discussion and Analysis of Financial - ------- Condition and Results of Operations Overview Loislaw.com provides comprehensive, affordable and easy-to-use legal and related information to lawyers and law firms over the Internet and on compact disc. We offer more than 2,000 databases that we estimate to contain over 10 million documents. These databases consist of federal and state law, continuing legal education materials and other legal information. As of June 30, 2000, our databases included court decisions, statutes, acts, and regulations of all 50 states and the District of Columbia, the U.S. Code, the Code of Federal Regulations, and court decisions for the U.S. Supreme Court, all 13 U.S. Circuit Courts of Appeal, selected Federal District Court Reports, and selected U.S. Bankruptcy Court Opinions. We generate revenues primarily from the sale of web-based products for fixed annual subscription fees. The list price for unlimited Internet access to substantially all federal and state law databases that we offer is currently $139 per seat per month. During 1999, we offered another multi-jurisdiction product offering fewer databases for $98 per month. The list price for unlimited Internet access to substantially all state law for a single state currently varies from state to state from $39 to $69 per seat per month. We do not charge any additional fees for multiple permitted users of a seat but only one simultaneous access per seat is allowed. Our pricing strategy with respect to our web-based products may change as a result of our evolving market. Continuing legal education materials, bar materials, and some specialty databases are available for an additional charge. Historically, we offered compact disc products at annual subscription prices ranging from $300 to $690 per state or federal jurisdiction. In recent periods, we have de-emphasized our compact disc products by implementing a focused marketing and sales effort for our web-based products. Since July 1999, we have offered new subscriptions only for our web-based products. Some revenue from compact disc sales will continue as we fulfill obligations to our current compact disc customers. Revenues from compact disc products also include a small amount of revenue from one-time sales of bar association publications. We will continue to make these one-time compact disc sales. The migration of our customers to our web-based products will increase our average revenue per customer if most customers purchase our unlimited Internet access package, National CollectionSM, featuring substantially all of our primary state and federal law databases. It will also decrease our average cost per customer if fewer customers use our compact disc products. This is because we currently provide our compact disc customers with updated discs every 90 days and because compact disc products typically require significantly more customer and technical support due to the reinstallation of updated compact discs and issues with customer hardware configuration changes. Upon the sale of a new subscription, the total amount of the subscription fee is accounted for as deferred revenue. Revenues from subscription sales are recognized on a monthly basis Page 7 over the subscription period, which is typically one year. Subscription fees are paid up front in cash or on a monthly basis by electronic funds transfer or credit card. Database costs consist primarily of database production costs that support both our web-based products and our compact disc products. Database production costs represent amounts incurred for data acquisition and conversion, editing, coding and quality control of legal information, related salaries and benefits, facilities cost allocation and related expenses associated with computers for data processing. We capitalize costs, other than overhead allocations, related to the production of databases. Because court decisions have significant value for long periods of time or indefinitely, we amortize our court decision databases over 20 years. We amortize databases containing statutes and regulations, which have a more limited useful life, over two years. We expense as incurred database maintenance and updating costs. Results of Operations Comparison of Results for the Three Months Ended June 30, 2000 and 1999 Revenues. Total revenues increased 128.5% to $3.4 million for the three months ended June 30, 2000 from $1.5 million for the three months ended June 30, 1999. We believe the revenues from subscriptions increased due primarily to the increase in the number of legal databases we offered to 2,023 at June 30, 2000 from 986 at June 30, 1999 and the increase in our marketing efforts. We expect that this trend will continue and that web-based subscription revenues will represent substantially all of our total revenues in future periods. Total database seats increased 129.9% to 20,302 at June 30, 2000 from 8,829 at June 30, 1999. Database Costs. Total database costs increased 18.6% to $1.9 million for the three months ended June 30, 2000 from $1.6 million for the three months ended June 30, 1999. The increase is primarily attributable to increased amortization and updating costs as a result of having more databases. Selling and Marketing Expense. Selling and marketing expense increased 51.2% to $3.9 million for the three months ended June 30, 2000 from $2.6 million for the three months ended June 30, 1999. This was principally due to an increase of 304.1% in our commission expenses associated with an increase in the amount of commissionable sales for the three months ended June 30, 2000 compared to the three months ended June 30, 1999. Selling and marketing expense consists primarily of: . employee salaries and benefits for marketing and customer support personnel; . sales commissions paid to our sales force; . advertising expenses; . the cost of direct marketing promotional materials; and . facilities cost allocation and related expenses. We pay sales commissions upon receipt of an initial subscription payment after subscription agreements are signed. We record commissions as prepaid costs and amortize them ratably over the term of the contract, typically one year, as we recognize the associated revenues. We do not pay commissions on renewals of subscriptions. We expense all other selling and marketing costs as incurred. Page 8 General and Administrative Expense. General and administrative expense increased 47.0% to $1.4 million for the three months ended June 30, 2000 from $936,000 for the three months ended June 30, 1999. This increase resulted primarily from an increase of 33.9% in compensation expenses associated with an increase in the number of administrative employees, including technical support employees who support our web site, to 86 at June 30, 2000 from 75 at June 30, 1999. General and administrative expense consists primarily of employee salaries and benefits, facilities cost allocation and related expenses associated with our management, finance, human resources, management information systems and administrative groups. Interest Income. Interest income increased 551.0% to $153,000 for the three months ended June 30, 2000 from $23,000 for the three months ended June 30, 1999. This increase was due primarily to an increase in funds available for investment as a result of our initial public offering in September 1999. Interest Expense. Interest expense decreased 98.8% to $8,594 for the three months ended June 30, 2000 from $738,000 for the three months ended June 30, 1999. This decrease was due primarily to the reduction of debt using proceeds from our initial public offering. Comparison of Results for the Six Months Ended June 30, 2000 and 1999 Revenues. Total revenues increased 123.1% to $6.2 million for the six months ended June 30, 2000 from $2.8 million for the six months ended June 30, 1999. We believe revenues from subscriptions increased for the same reasons discussed above in the comparison of the quarter ended June 30, 2000 to the quarter ended June 30, 1999. Database Costs. Total database costs increased 38.7% to $3.8 million for the six months ended June 30, 2000 from $2.7 million for the six months ended June 30, 1999. The increase is attributable to the same reasons discussed above in the comparison of the quarter ended June 30, 2000 to the quarter ended June 30, 1999. Selling and Marketing Expense. Selling and marketing expense increased 84.8% to $8.0 million for the six months ended June 30, 2000 from $4.3 million for the six months ended June 30, 1999. This was principally due to the same reasons discussed above in the comparison of the quarter ended June 30, 2000 to the quarter ended June 30, 1999. General and Administrative Expense. General and administrative expense increased 79.9% to $3.1 million for the six months ended June 30, 2000 from $1.7 million for the six months ended June 30, 1999. This increase resulted primarily from the same factors discussed above in the comparison of the quarter ended June 30, 2000 to the quarter ended June 30, 1999. Interest Income. Interest income increased 1,199.8% to $387,000 for the six months ended June 30, 2000 from $30,000 for the six months ended June 30, 1999. This increase was due primarily to an increase in funds available for investment as a result of our initial public offering in September 1999. Interest Expense. Interest expense decreased 99.3% to $9,000 for the six months ended June 30, 2000 from $1.3 million for the six months ended June 30, 1999. This decrease was due primarily to the reduction of debt using proceeds from our initial public offering and the elimination of interest expense associated with amortization of deferred loan costs of $396,000 for the six months ended June 30, 1999. Page 9 Liquidity and Capital Resources We have used substantial amounts of cash in the growth of our company. Net cash used in operating activities was $6.5 million and $5.9 million for the six months ended June 30, 2000 and 1999, respectively. The primary use of cash was the payment of operating expenses, including database production costs. We expect to continue to incur significant database production costs for the foreseeable future. The continued payment and amortization of database production costs, together with increased selling and marketing expenditures, is expected to generate losses for 2000 and at least through the first half of 2001. Net cash used in investing activities was $5.3 million and $7.6 million for the six months ended June 30, 2000 and 1999, respectively. The primary use of cash was the payment of the capitalized portion of our database production costs. For the six months ended June 30, 1999, $5.7 million of these expenditures was for the payment of database production costs, which we capitalized, and $1.7 million was for property and equipment and other assets purchased to support the growth of our business. For the six months ended June 30, 2000, $4.4 million of these expenditures was for the payment of database production costs, which we capitalized, and $971,000 was for property and equipment and other assets purchased to support the growth of our business. For the six months ended June 30, 2000, financing of our operations and continued expansion was from cash reserves remaining from additional capital obtained through our initial public offering of 3.9 million shares of common stock in September 1999, the proceeds from a term loan for $600,000 from a financial institution, and the sale of common stock from the exercise of stock options. Total financing, net of repayments, was approximately $788,000 for the six-month period ended June 30, 2000. To finance our operations and continued expansion during the first six months of 1999, we obtained additional capital through private placements of debt from a related party. Total financing, net of repayments, was approximately $16.7 million for the six months ended June 30, 1999. During 2000, we anticipate our selling and marketing expenses will increase due to more aggressive marketing. We believe available cash on hand generated from operations and our initial public offering will be adequate to meet our anticipated cash needs for working capital and capital expenditures throughout the year 2000. However, we may choose to seek additional financing to accelerate our growth by, for example, adding new specialty databases at a faster pace, to expand our marketing activities or for other purposes. As part of our growth strategy, we may consider acquiring companies or businesses, and any acquisition could significantly increase our cash requirements. An acquisition, or any other increase in our anticipated cash requirements, could require us to obtain additional financing. We cannot assure you that additional financing would be available to us or, if available, that we would be able to obtain it on terms we considered satisfactory. On April 28, 2000, the Company executed a promissory note with Bank of America for the purchase of computer equipment. This note was for $600,000 with a term of 36 months. As of June 30, 2000, the balance of the note was $571,000. Page 10 Net Operating Loss Carryforwards Since 1994, we have incurred significant net losses. Through June 30, 2000, our accumulated deficit totaled $46.2 million. At December 31, 1999, we had net operating loss carryforwards of approximately $49 million, which will begin to expire in 2010 for federal income tax purposes and in 2000 for state purposes. We cannot assure you that we will have income that is sufficient to allow us to use these loss carryforwards. Recently Issued Accounting Pronouncements In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement No. 133, "Accounting for Derivative Instruments and Hedging Activities," which is required to be adopted in years beginning after June 15, 2000. Because Loislaw.com does not use derivatives, Statement No. 133 will have no significant effect on earnings or the financial position of Loislaw.com, Inc. In December 1999, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements" (SAB 101), which, as amended, must be adopted no later than October 1, 2000. SAB 101 deals with various revenue recognition issues. Management believes adoption of Interpretation No. 44 will have no significant effect on earnings or the financial position of Loislaw.com, Inc. In March 2000, the FASB issued Interpretation No. 44, "Accounting for Certain Transactions Involving Stock Compensation," which is generally effective July 1, 2000. This interpretation clarifies the application of Accounting Principles Board Opinion No. 25. Management believes adoption of Interpretation No. 44 will have no significant effect on earnings or the financial position of Loislaw.com, Inc. Forward-Looking Statements Except for the historical information contained herein, the matters discussed in this report on Form 10-Q are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are dependent on certain risks and uncertainties. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting Loislaw.com and the financial condition of our business. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to a variety of factors. These factors include, among other things, our ability to predict and respond to rapid technological changes; the presence of competitors in the web-based legal information market with larger databases and greater financial resources; the availability of free legal information from Internet portal companies and government agencies; the acceptance of our products by the market; our potential loss of relationships with legal information providers; difficulties managing growth; difficulties caused by Year 2000 problems; difficulties caused by Internet accessibility and increased usage; potential system failures due to viruses, telecommunications failures or other damage to our computer systems; risks due to our reliance on foreign data converters; legal liability caused by legal information provided in our databases; and the other risks detailed from time to time in the reports we file with the Securities and Exchange Commission, including the factors discussed under the heading "Risk Factors" in the Company's annual report on Form 10-K for the year ended December 31, 1999. Page 11 In addition, in this report, the words "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect," and similar expressions are intended to identify forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Item 3. Quantitative and Qualitative Disclosures about Market Risk - ------- We do not engage in commodity futures trading or hedging activities and do not enter into derivative financial instrument transactions for trading or other speculative purposes. We also do not engage in transactions in foreign currencies or in interest rate swap transactions that could expose us to market risk. We are not subject to interest rate risk in connection with our promissory note with Bank of America. The interest rate term of this note is fixed for the term of the note. Page 12 FORM 10-Q LOISLAW.COM, INC. PART II. OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders - ------- The Annual Meeting of Stockholders of the Company was held on June 13, 2000. At the meeting, the stockholders elected the person set forth in the table below to serve as a director for a term expiring at the 2003 Annual Meeting of Stockholders: Votes Votes Nominee For Against Abstention ------- --- ------- ---------- Hannah C. Stone 18,475,612 -0- -0- Also, at the meeting the stockholders approved the 1999 Nonqualified Stock Option Plan for Nonemployee Directors. The results of the vote on this item were as set forth below: FOR 11,375,018 AGAINST 684,018 ABSTAIN 6,158,400 Also, at the meeting the stockholders approved the adoption of the 2000 Stock Option Plan for Sales and Marketing Personnel. The results of the vote on this item were as set forth below: FOR 18,001,116 AGAINST 474,496 ABSTAIN -0- Also, at the meeting the stockholders approved an Amendment to the 1996 Stock Option Plan to increase the number of available shares from 1,500,000 shares to 1,950,000 shares. The results of the vote on this item were as set forth below: FOR 18,126,504 AGAINST 349,108 ABSTAIN -0- Item 5. Other Information. - ------- Loislaw.com has elected to comply with the requirement to make quarterly financial information available to its stockholders by making its quarterly reports on Form 10-Q available through its web site. To view or print this information, please visit our web site at www.loislaw.com and select "Investor --------------- Relations -- SEC Filings." You may also request that a copy of our most recent report on Form 10-Q be mailed to you by submitting a request through our web site by selecting "Investor Relations -- Info Request" or by calling Loislaw.com's Investor Resources Information Line toll free at (877) 447-5647. Item 6. Exhibits and Reports on Form 8-K. - ------- (A) Exhibits -------- 27.1 Financial Data Schedule (B) Reports on Form 8-K ------------------- The Company did not file any reports on Form 8-K during the three months ended June 30, 2000. Page 13 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 thereunto duly authorized. LOISLAW.COM, INC. ---------------------------------------- (Registrant) Date: 08/11/2000 /s/ MARK O. BEYLAND ---------------- ---------------------------------------- Mark O. Beyland President and Chief Financial Officer (Principal Financial and Duly Authorized Officer) Page 14 FORM 10-Q INDEX TO EXHIBITS LOISLAW.COM, INC. Sequentially Exhibit Numbered Number Exhibit Page ----------- ------------------------------------- -------------- 27.1 Financial Data Schedule 16 Page 15 EX-27 2 0002.txt FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE REGISTRANT'S REPORT ON FORM 10-Q FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 6-MOS DEC-31-2000 JAN-01-2000 JUN-30-2000 8,214,425 0 6,160,225 405,579 0 16,297,264 31,094,965 7,206,731 40,785,498 12,395,697 0 0 0 21,048 28,368,753 40,785,498 6,229,619 6,229,619 0 (14,973,842) 0 0 379,263 (8,364,579) 0 (8,364,579) 0 0 0 (8,364,579) (.40) (.40)
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