-----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, LUO6o90Joi1bNO7GPHG1v3lL1uF7YnhQ5Cv0rm6ZEFlo02SI0Bc7UlrqBx8TZdx4 oEkmqilYy7u06lMTOGL8jg== 0001029869-97-000984.txt : 19970814 0001029869-97-000984.hdr.sgml : 19970814 ACCESSION NUMBER: 0001029869-97-000984 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970813 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: EIS INTERNATIONAL INC /DE/ CENTRAL INDEX KEY: 0000032251 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE & TELEGRAPH APPARATUS [3661] IRS NUMBER: 061017599 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-20329 FILM NUMBER: 97659758 BUSINESS ADDRESS: STREET 1: 555 HERNDON PARKWAY CITY: HERNDON STATE: VA ZIP: 22070 BUSINESS PHONE: 2033514800 FORMER COMPANY: FORMER CONFORMED NAME: ELECTRONIC INFORMATION SYSTEMS INC DATE OF NAME CHANGE: 19940218 10-Q 1 EIS INTERNATIONAL, INC. FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 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, 1997 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 0-20329 EIS INTERNATIONAL, INC. (Exact name of registrant as specified in its charter) Delaware No. 06-1017599 (State or other jurisdiction (I.R.S. Employer of incorporation) Identification Number) 555 Herndon Parkway Herndon, VA 20170 (703) 478-9808 (Registrant's telephone number, including area code) --------------------- 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 --- --- Indicate the number of shares outstanding of each of the issuer's classes of common stock: Common Stock, par value $.01 per share, outstanding as of July 16, 1997: 11,442,715 shares. EIS INTERNATIONAL, INC. and SUBSIDIARIES INDEX to Financial Statements Filed with Quarterly Report of Registrant on Form 10-Q for the Quarter Ended June 30, 1997 (Unaudited)
PART I. FINANCIAL INFORMATION Item 1. Financial Statements: Page ---- Unaudited Consolidated Balance Sheets as of June 30, 1997 and December 31, 1996 3 Unaudited Consolidated Statements of Operations for the three and six months ended June 30, 1997 and 1996 4 Unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 1997 and 1996 5 Notes to Consolidated Financial Statements (unaudited) 6-7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8-10 PART II. OTHER INFORMATION Item 1. Legal Proceedings 11 Item 2. Changes in Securities Not Applicable Item 3. Defaults Upon Senior Securities Not Applicable Item 4. Submission of Matters to a Vote of Security Holders 12 Item 5. Other Information Not Applicable Item 6. Exhibits and Reports on Form 8-K 12 Signatures 13
2 EIS INTERNATIONAL, INC. AND SUBSIDIARIES Consolidated Balance Sheets (Dollars in Thousands)
June 30, December 31 1997 1996 ----------- ----------- (Unaudited) Assets Current assets: Cash and cash equivalents $ 9,731 $ 11,099 Short-term investments 3,332 3,660 Accounts receivable, trade, less allowances for doubtful accounts and sales returns of $5,958 in 1997 and $6,117 in 1996 16,119 21,335 Current portion of installment and lease receivables 1,828 2,007 Inventories (note 4) 7,489 7,732 Deferred income taxes 10,096 8,638 Refundable income taxes 2,359 2,450 Prepaids and other current assets 923 576 --------- -------- Total current assets 51,877 57,497 Capitalized software development costs, net 4,694 4,617 Property and equipment, net 7,271 8,181 Installment and lease receivables, less current portion 2,070 2,470 Other assets 1,801 1,925 --------- -------- Total assets $ 67,713 $ 74,690 ========= ======== Liabilities and Stockholders' Equity Current liabilities: Accounts payable and accrued liabilities $ 13,701 $ 18,894 Deferred revenue 6,936 5,683 Net liability of discontinued operations 1,039 2,738 --------- -------- Total current liabilities 21,676 27,315 Deferred income taxes 1,829 1,829 Other liabilities 283 304 --------- -------- Total liabilities 23,788 29,448 Commitments and Contingencies Stockholders' equity: Common Stock, $.01 par value, 15,000,000 shares authorized, issued 11,543,940 shares in 1997 and 11,173,252 shares in 1996 115 112 Additional paid-in capital 59,094 58,268 Accumulated translation adjustments (179) (196) Retained deficit (14,200) (12,037) Treasury stock, at cost - 101,225 shares in 1997 and 1996 (905) (905) --------- -------- Total stockholders' equity 43,925 45,242 --------- -------- Total liabilities and stockholders' equity $ 67,713 $ 74,690 ========= ========
See accompanying notes to consolidated financial statements. 3 EIS INTERNATIONAL, INC. AND SUBSIDIARIES Consolidated Statements of Operations (In Thousands, Except Per Share Amounts) (Unaudited)
Three Months Six Months Ended June 30, Ended June 30, ------------------------- ------------------------- 1997 1996 1997 1996 -------- -------- -------- -------- Net revenues: Product and software sales $ 16,385 $ 24,989 $ 30,298 $ 46,568 Service and other 6,728 5,627 13,038 9,813 -------- -------- -------- --------- 23,113 30,616 43,336 56,381 Cost of revenues: Cost of product and software sold 5,888 8,109 11,494 15,501 Cost of services and other 3,966 3,375 8,152 5,970 -------- -------- -------- --------- 9,854 11,484 19,646 21,471 -------- -------- -------- --------- Gross margin 13,259 19,132 23,690 34,910 -------- -------- -------- --------- Operating cost and expense: Research and development cost 3,156 3,310 6,402 6,054 Selling, general, and administrative 8,240 9,840 18,441 19,883 Restructuring costs - - 2,877 Acquired technology in process - - - 16,900 -------- -------- -------- --------- 11,396 13,150 27,720 42,837 -------- -------- -------- --------- Operating income (loss) 1,863 5,982 (4,030) (7,927) Other income, net: Interest and other income, net 324 291 532 694 -------- -------- -------- --------- Income (loss) before income taxes 2,187 6,273 (3,498) (7,233) Income tax benefit (expense) (828) (2,322) 1,335 (4,058) -------- -------- -------- --------- Income (loss) from continuing operations 1,359 3,951 (2,163) (11,291) Discontinued operations: Income (loss) on discontinued operations, net of tax - (808) - (1,381) -------- -------- -------- --------- Net income (loss) $1,359 $3,143 $ (2,163) $(12,672) ======== ======== ======== ========= Primary income (loss) per share: Continuing operations $ 0.12 $ 0.34 $ (0.19) $ (1.09) Discontinued operations - (0.07) - (0.13) -------- -------- -------- --------- Primary income (loss) per share $ 0.12 $ 0.27 $ (0.19) $ (1.22) ======== ======== ======== ========= Fully diluted income (loss) per share: Continuing operations $ 0.12 $ 0.34 $ (0.19) $ (1.09) Discontinued operations - (0.07) - (0.13) -------- -------- -------- --------- Fully diluted income (loss) per share $ 0.12 $ 0.27 $ (0.19) $ (1.22) ======== ======== ======== ========= Weighted average common and common equivalent shares: Primary 11,405 11,609 11,179 10,354 Fully diluted 11,500 11,727 11,179 10,354
See accompanying notes to consolidated financial statements. 4 EIS INTERNATIONAL, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows (Dollars in Thousands) (Unaudited)
Six Months Ended June 30, ---------------------------- 1997 1996 -------- ------- Cash flows from operating activities: Net loss $ (2,163) $ (12,672) Adjustments to reconcile net loss to net cash used in operating activities: Provision for doubtful accounts and sales returns 1,907 620 Write-off acquired technology in process - 16,900 Depreciation and amortization 4,251 2,796 Deferred income taxes (1,458) - Changes in assets and liabilities: Accounts receivable, trade 3,309 (629) Installment and lease receivables 579 (1,373) Inventories 243 (867) Prepaids and other current assets (347) (381) Accounts payable and accrued expenses (5,123) (938) Deferred revenue 1,253 (376) Other (300) (510) ------- -------- Net cash provided by continuing operations 2,151 2,570 Cash used in discontinuing operations (1,699) (1,693) ------- -------- Net cash provided by (used in) operating activities 452 877 ------- -------- Cash flows from investing activities: Purchases of property and equipment (2,208) (2,006) Sales of short-term investments 2,371 - Purchases of short-term investments (2,043) - Capitalization of software development costs (769) (1,518) Purchases of businesses, net of cash acquired - (6,520) ------- -------- Net cash used in investing activities (2,649) (10,044) ------- -------- Cash flows from financing activities: Sale of lease portfolio - 5,200 Proceeds from exercise of stock options 829 5,113 ------- -------- Net cash provided by financing activities 829 10,313 ------- -------- Net increase (decrease) in cash and cash equivalents (1,368) 1,146 Cash and cash equivalents at beginning of period 11,099 21,002 ------- -------- Cash and cash equivalents at end of period $ 9,731 $ 22,148 ======= ======== Supplemental disclosure of cash flow information: Cash paid during the period for: Interest $ 77 $ 86 Income taxes 155 3,138 Non-cash financing activities: Tax benefit from exercise of stock options - 1,868
See accompanying notes to consolidated financial statements. 5 EIS INTERNATIONAL, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (1) Basis of Presentation The unaudited consolidated financial statements presented herein have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures necessary to conform with annual reporting requirements. The statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report for the year ended December 31, 1996. In the opinion of management, the accompanying consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the Company's financial position and results of operations. The results of operations for the three and six month periods ended June 30, 1997 may not be indicative of the results for the full year. (2) Principles of Consolidation The accompanying financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. (3) Discontinued Operations and Restructuring On February 28, 1997, at the recommendation of new management, the Board of Directors of the Company resolved to discontinue the operations of Surefind Information, Inc. ("Surefind"). Accordingly, the Consolidated Statement of Operations for the three and six month periods ended June 30, 1996 has been reclassified to reflect the results of Surefind on a discontinued operations basis. The results of Surefind for the three and six months ended June 30, 1997 has been charged against the provision for estimated operating losses during the phase out period established at December 31, 1996. On March 3, 1997, the Company announced a restructuring and reorganization program (the "Restructuring"), the purpose of which was to refocus the Company on its core business and to reduce costs. During the first quarter of 1997, in connection with the Restructuring, the Company recorded charges of $2.9 million including $1.1 million of severance costs, $1.3 million of facilities leases and fixed asset disposal costs, and $0.5 million of other costs. (4) Inventories Inventories primarily consists of finished goods as of June 30, 1997 and December 31, 1996. 6 EIS INTERNATIONAL, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited) (5) New Accounting Pronouncements In February 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standard ("SFAS") No. 128, "Earnings per Share" which is effective for all interim and annual periods ending after December 15, 1997. SFAS No. 128 replaces primary and fully diluted earnings per share ("EPS") with "basic" and "diluted" EPS on the face of the statement of operations. The Company does not expect the adoption of SFAS No. 128 to have a material effect on its financial position or results of operations. In February 1997, FASB issued SFAS No. 129, "Disclosure of Information about Capital Structure" which is effective for the year ending December 31, 1998. SFAS No. 129 continues the previous requirements to disclose certain information about an entity's capital structure found in Accounting Principles Board ("APB") Opinions No. 10, "Omnibus Opinion-1966," and No. 15, "Earnings per Share," and FASB SFAS No. 47, "Disclosure of Long-Term Obligations." The Company has been subject to the requirements of those standards, and as a result does not expect the adoption of SFAS No. 129 to have a material impact on the Company's financial statements. In June 1997, FASB issued SFAS No. 130, "Reporting Comprehensive Income" which is effective for the year ending December 31, 1998. SFAS No. 130 establishes standards for the reporting and display of comprehensive income and its components in the financial statements. Earlier application of this statement is permitted; however, upon adoption the Company will be required to reclassify previously reported annual and interim financial statements. The Company believes that the disclosure of comprehensive income in accordance with the provisions of SFAS No. 130 will impact the manner of presentation of its financial statements as currently and previously reported. In June 1997, FASB issued SFAS No. 131, "Disclosure about Segments of an Enterprise and Related Information," which is effective for the year ending December 31, 1998. SFAS No. 131 requires companies to present certain information about operating segments and related information, including geographic and major customer data, in its annual financial statements and in condensed financial statements for interim periods. The Company does not believe that the adoption of SFAS No. 131 will have a material impact on its financial statements. 7 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations The Company's quarterly and annual operating results are affected by a wide variety of factors that could materially and adversely affect revenues and profitability, including the timing of customer orders; its ability to introduce new products on a timely basis; introduction of products and technologies by competitors; and market acceptance of the Company's and its competitors products. As a result of the foregoing and other factors, the Company may experience material fluctuations in its future operating results on a quarterly or annual basis, which could materially and adversely affect its business, financial condition, operating results and stock price. This quarterly report contains certain cautionary statements and information relating to the Company that are based on the beliefs of its management and assumptions made by and information currently available to that management. When used in this report, the words "believe," and "expect," and words or phrases of similar import, as they relate to the Company, its subsidiaries or its management, are intended to identify cautionary statements. Such cautionary statements reflect the current risks, uncertainties, and assumptions related to certain factors including, without limitations, competitive factors, general economic conditions, customer relations, technological change, product introductions and acceptance, distribution networks, changes in industry practices, one-time events and other factors described herein and under the heading "Factors Affecting Future Results" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1996. Based upon changing conditions, should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein. Unless otherwise stated below, the Company does not intend to update those cautionary statements. Results of Operations - --------------------- NET REVENUES Net revenues of $23.1 million in the second quarter of 1997 decreased 25% from $30.6 million in the second quarter of 1996. Product and software revenues during the second quarter of 1997 decreased $8.6 million (34%) while service and other revenues increased $1.1 million (20%) from the second quarter of 1996. Net revenues of $43.3 million during the first six months of 1997 decreased $13.0 million (23%) from $56.4 million during the first six months of 1996. Product and software revenues during this period decreased $16.3 million (35%) while service and other revenues increased $3.2 million (33%) from the first six months of 1996. The decrease in product and software sales is primarily a result of a decrease in sales of the Company's mature products which were not offset by an increase in sales of its newer products, the timing of shipment and installation of customer orders, and a decrease in sales of the Company's wholly owned subsidiary Cybernetics Systems International Corp. ("Cybernetics"). Service and other revenues increased primarily due to expansion of the Company's customer base covered by service contracts and the expansion of its systems integration business. COST OF REVENUES Cost of revenues was 43% of net revenues in the second quarter of 1997 compared to 38% of net revenues in the second quarter of 1996. Product costs as a percentage of product revenues increased to 36% from 32% in the second quarter of 1997 as compared to the second quarter of 1996. Cost of revenues was 45% of net revenues during the first six months of 1997 compared to 38% during the same period in 1996. Product costs as a percentage of product revenues increased to 38% from 33% during the 8 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) first six months of 1997 as compared to the same period in 1996. The increase in product costs as a percentage of net revenue is primarily due to the fixed cost of certain operations which do not fluctuate with changes in product revenue. Service and other costs were 59% of service and other revenues in the second quarter of 1997 compared to 60% in the second quarter of 1996. Service and other costs were 63% of service and other revenues during the first six months of 1997 compared to 61% for the same period in 1996. The increase in costs of service and other as a percentage of service and other revenues during the first six months of 1997 is due primarily to an increase in the cost of maintenance parts shipped to customers under the related service agreements during the first quarter of 1997. RESEARCH AND DEVELOPMENT COST Research and development cost decreased $154,000 during the second quarter of 1997 as compared to the second quarter of 1996. This decrease was primarily due to a decline in the use of subcontractor software engineers offset by a decline in the capitalization of certain software development costs. In accordance with Statement of Financial Accounting Standards No. 86, the Company capitalizes certain software development costs relating to the enhancement of existing products and to the development of new products. Research and development cost increased $348,000 during the first six months of 1997 as compared to the first six months of 1996. The increase was primarily due to a decline in capitalization of software development costs during the first six months of 1997 as compared to the same period in 1996. SELLING, GENERAL AND ADMINISTRATIVE Selling, general and administrative expense declined $1.6 million for the second quarter of 1997 as compared to the second quarter of 1996, and declined $1.4 million during the first six months of 1997 as compared to the same period in 1996. During the first quarter of 1997, in connection with the Restructuring, the Company downsized its Cybernetics and Pulse Technologies, Inc. ("Pulse") subsidiaries and consolidated several of its administrative functions and facilities. RESTRUCTURING COSTS As discussed above, during the first quarter of 1997, the Company downsized its Cybernetics and Pulse subsidiaries and consolidated several of its administrative functions and facilities. The Restructuring costs incurred during the first quarter of 1997 primarily represent severance and lease buyout costs associated with those actions. ACQUIRED TECHNOLOGY IN PROCESS The acquired technology in process costs of $16.9 million incurred in the first quarter of 1996 reflect the fair value of the software products under development at Cybernetics that had not achieved technological feasibility at the date of the Company's acquisition of Cybernetics, and had no alternative future uses, and were therefore charged against the Company's operations at the time of the acquisition. 9 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) INTEREST AND OTHER INCOME, NET Interest and other income remained consistent during the second quarter of 1997 as compared to the same period in 1996. Interest and other income decreased during the first six months of 1997 compared to the same period in 1996 primarily due to the sale of a major portion of the Company's lease portfolio during the first quarter of 1996 and lower cash balances during the first six months of 1997 as compared to the same period in 1996. INCOME TAXES The Company's effective income tax rate was 38% for the second quarter of 1997 as compared to 37% for the same period in 1996. Income taxes decreased during the first six months of 1997 to a tax benefit of $1.3 million, as compared to a tax expense of $4.1 million during the same period in 1996. This change was primarily caused by the non-deductible acquired technology in process and other costs incurred during the first quarter of 1996 associated with the Company's acquisitions during that period. LIQUIDITY AND CAPITAL RESOURCES The Company's working capital was $30.2 million at June 30, 1997 and December 31, 1996. Cash and cash equivalents and short-term investment balances were $13.1 million at June 30, 1997 compared to $14.8 million at December 31, 1996. Operating activities generated $452,000 in cash during the six month period ended June 30, 1997 compared to $877,000 in cash for the same period in 1996. This decrease was due to a decrease in cash from continuing operations which was $2.2 million for the first six months of 1997 as compared to $2.6 million for the same period in 1996. Cash and cash equivalents used to invest in the purchase of property and equipment was $2.2 million for the first six months of 1997 and $2.0 million for the first six months of 1996. The capitalization of software development costs decreased from $1.7 million during the first six months of 1996 to $769,000 for the same period in 1997. Proceeds from the exercise of stock options decreased to $829,000 during the first six months of 1997 from $5.1 million during the same period in 1996. The Company had an unsecured line of credit of $12.5 million with a commercial bank under a commitment that expired in January 1997 and was not renewed. The Company has received a letter of intent with a commercial bank to implement a new $7 million, secured line of credit and is currently in the process of finalizing that agreement. The Company expects that its current cash balances and short-term investments, together with cash anticipated to be provided by operating activities, will be sufficient to fund its working capital requirements (including research and development) through the balance of 1997. However, the Company's ability to achieve that result will be affected by the amount of cash generated from operations and the pace that its available resources are utilized. Accordingly, the Company may in the future be required to seek additional sources of financing, including borrowing and/or the sale of equity. If additional funds are raised by issuing equity, further dilution to shareholders may result. No assurance can be given that any such additional sources of financing will be available on acceptable terms, or at all. 10 PART II. OTHER INFORMATION Item 1. Legal Proceedings. The Company and certain individuals indicated below are named as defendants in the following lawsuits, each of which were filed on the date indicated in the United States District Court for the District of Connecticut, allegedly on behalf of certain of the Company's shareholders, each of which claim certain alleged misleading representations regarding the Company's acquisition of Surefind and Cybernetics and their operations, each of which seek damages in an unspecified amount. 1. Warburgh v. EIS International, Inc., Joseph J. Porfeli, Edward J. Sarkesian and Kent M. Klineman, filed April 25, 1997. ----------------------------------------------------------------- 2. Wallace v. EIS International, Inc., Joseph J. Porfeli, Edward J. Sarkesian, Harry Peisach, and Kent M. Klineman, filed May 21, 1997. ------------------------------------------------------------------- 3. Augenbaum v. EIS International, Inc., Joseph J. Porfeli, Edward J. Sarkesian, Kent M. Klineman, Robert Jeserum and Herbert Balzuweit, filed May 23, 1997. ------------------------------------------------------------------------ 4. Romano, et. al. v. EIS International, Inc., Joseph J. Porfeli, Edward J. Sarkesian, and Kent M. Klineman, filed June 4, 1997. --------------------------------------------------------------------- 5. Dechter v. EIS International, Inc., Joseph J. Porfeli, Edward J. Sarkesian, Kent M. Klineman and Harry Peisach, filed June 4, 1997. ------------------------------------------------------------------ The Company expects that these lawsuits will be consolidated and that a single amended complaint will be filed. The Company and various other defendants have retained counsel, the claims are being reviewed, and the lawsuits will be vigorously defended. The Company is a party to various legal actions and claims arising in the ordinary course of its business. The Company believes that it has adequate legal defenses for each of the actions and claims and believes that their ultimate disposition will not have a material adverse effect on the Company's consolidated financial position or results of operations. Item 2. Changes in Securities. None. Item 3. Defaults Upon Senior Securities. None. 11 Item 4. Submission of Matters to a Vote of Security Holders. The Company's Annual Meeting of Stockholders was held on July 24, 1997. The results of voting at this meeting are provided below: Broker Election of Directors For Withheld Non-Votes - --------------------- --------- -------- --------- Kent M. Klineman 7,836,307 172,959 - James E. McGowan 7,841,475 167,791 - Broker Ratification of Auditors For Against Abstain Non-Votes - ------------------------ ---------- ------- ------- --------- KPMG Peat Marwick 7,963,162 22,932 23,172 - The following directors continue to serve their respective terms: Robert J. Cresci, Robert M. Jesurum, and Charles W. McCall. Item 5. Other Information. None. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits Exhibit 11 - Statement Re Computation of Earnings Per Share Exhibit 27 - Financial Data Schedule (b) Reports on Form 8-K On May 28, 1997, the Company filed Form 8-K to report the adoption of a Shareholder Rights Plan effective May 16, 1997. This plan provides for distribution to shareholders of certain rights to acquire shares of the Company's equity securities. Under certain circumstances, the rights are exerciseable in the event that a person or group acquires, or has the right to acquire, 20% or more of the Company's outstanding common stock, or has commenced a tender offer or exchange offer that would result in a person or group beneficially owning 20% or more of the Company's common stock. 12 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. EIS INTERNATIONAL, INC. Date: August 13, 1997 By: /s/ James E. McGowan --------------------------- ---------------------- James E. McGowan President and Chief Executive Officer Date: August 13, 1997 By: /s/ Frederick C. Foley --------------------------- ------------------------ Frederick C. Foley Senior Vice President, Finance, Chief Financial Officer and Treasurer 13 EX-11 2 STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS EIS International, Inc. and Subsidiaries Exhibit 11 Statement Re Computation of Per Share Earnings (in thousands, except for per share amounts)
Three Months Ended June 30, Six Months Ended June 30, 1997 1996 1997 1996 ------- ------- -------- -------- Income (loss) from continuing operations $ 1,359 $ 3,951 $ (2,163) $ (11,291) Discontinued operations - (808) (1,381) ------- ------- -------- --------- Net income (loss) $ 1,359 $ 3,143 $ (2,163) $ (12,672) ======= ======= ======== ========= Weighted average nunber of common and common equivalent shares: Common shares outstanding 11,224 10,668 11,179 10,354 Dilutive effect of stock options and warrants, primary computation 181 941 - - ------- ------- -------- --------- Weighted average number of common and common equivalent shares utilized in the primary income (loss) per share computation: 11,405 11,609 11,179 10,354 Additional dilutive effect of stock options and warrants, fully diluted computation 95 118 - - ------- ------- -------- --------- Weighted average number of common and common equivalent shares utilized in the fully diluted loss per share computation 11,500 11,727 11,179 10,354 ======= ======= ======== ========= Priory income (loss) per share: Continuing operations $ 0.12 $ 0.34 $ (0.19) $ (1.09) Discontinued operations - (0.07) - (0.13) ------- ------- -------- --------- Pimary income (loss) per share $ 0.12 $ 0.27 $ (0.19) $ (1.22) ======= ======= ======== ========= Fully diluted income (loss) per share: Continuing operations $ 0.12 $ 0.34 $ (0.19) $ (1.09) Discontinued operations - (0.07) - (0.13) ------- ------- -------- --------- Fully diluted income (loss) per share $ 0.12 $ 0.27 $ (0.19) $ (1.22) ======= ======= ======== =========
14 EX-27 3 FINANCIAL DATA SCHEDULE
5 1,000 U.S. DOLLARS 6-MOS DEC-31-1997 JAN-01-1997 JUN-30-1997 1 9,731 0 16,119 5,958 7,489 51,877 7,271 12,620 67,713 21,676 0 0 0 115 0 67,713 43,336 43,336 19,646 44,489 2,877 0 0 (3,498) 1,335 (2,163) 0 0 0 (2,163) (0.19) (0.19)
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