-----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, PPYe6aR0j6TCXnEct9OFwBkstXS4kLH7IygfDgdIUxhaaHJrH5MqpvyEX2wyBlQw RGncWzaBMPGf4DRIKA5rog== 0000724910-99-000006.txt : 19990217 0000724910-99-000006.hdr.sgml : 19990217 ACCESSION NUMBER: 0000724910-99-000006 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981231 FILED AS OF DATE: 19990216 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PREMIS CORP CENTRAL INDEX KEY: 0000724910 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 411424202 STATE OF INCORPORATION: MN FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-12196 FILM NUMBER: 99538890 BUSINESS ADDRESS: STREET 1: 13220 COUNTY ROAD 6 CITY: PLYMOUTH STATE: MN ZIP: 55441 BUSINESS PHONE: 6125501999 MAIL ADDRESS: STREET 1: 15301 HIGHWAY 55 WEST CITY: PLYMOUTH STATE: MN ZIP: 55447 10QSB 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-QSB (Mark One) [ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 1998 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT Commission file number 0-12196 PREMIS CORPORATION (Exact name of small business issuer as specified in its charter) Minnesota 41-1424202 (State or other jurisdiction of (IRS Employer Identification No.) incorporation or organization) 13220 County Road 6, Plymouth, Minnesota 55441 (Address of principal executive office) (612) 550-1999 (Issuer's telephone number) Not Applicable (Former name, former address and former fiscal year, if changed since last report) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [ ] The number of shares outstanding of the Issuer's Common Stock, $.01 par value, was 4,733,552 as of December 31, 1998. Transitional Small Business Disclosure Format (Check one): Yes [ ] No [ X ] PART 1 - FINANCIAL INFORMATION: ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS PREMIS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (Unaudited) Three Months Ended Nine Months Ended December 31, December 31, ------------------ ----------------- 1998 1997 1998 1997 ---- ---- ---- ---- REVENUES: Systems $ 474 $ 791 $ 4,313 $ 3,640 Maintenance and other services 250 413 739 1,283 ------ ------ ------ ------ Total revenues 724 1,204 5,052 4,923 COST OF REVENUES Systems 25 540 126 2,400 Support and other 82 168 345 498 ------ ------ ------ ------ Total cost of revenues 107 708 471 2,898 ------ ------ ------ ------ GROSS PROFIT 617 496 4,581 2,025 OPERATING EXPENSES Selling, general and administrative 494 796 1,580 2,217 Research and development 410 521 1,522 1,355 ------ ------ ------ ------ Total operating expenses 904 1,317 3,102 3,572 ------ ------ ------ ------ Operating income (loss) (287) (821) 1,479 (1,547) Interest income, net 39 13 48 58 Other (expense) income 46 - 20 29 ------ ------ ------ ------ NET INCOME (LOSS) BEFORE TAXES (202) (808) 1,547 (1,460) Income tax (benefit) expense (41) - (46) 2 ------ ------ ------ ------ NET INCOME (LOSS) $ (161) $ (808) $ 1,593 $ (1,462) ====== ====== ====== ====== Basic earnings (loss) per share $ (.03) $ (.17) $ .34 $ (.31) Diluted earnings (loss) per share $ (.03) $ (.17) $ .33 $ (.31) Shares used to compute: Basic earnings (loss) per share 4,734 4,714 4,732 4,714 Diluted earnings (loss) per share 4,734 4,714 4,830 4,714 PREMIS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) December 31, 1998 March 31, 1998 ----------------- -------------- (unaudited) (audited) ASSETS Current assets: Cash and cash equivalents $ 3,440 $ 1,360 Accounts receivable, net 344 610 Inventory 6 13 Prepaid expenses and other current assets 232 408 Refundable income taxes - 149 --------- --------- Total current assets 4,022 2,540 --------- --------- Property and equipment, net 520 1,316 Note receivable 308 405 Software distribution rights, net 21 83 --------- --------- TOTAL ASSETS $ 4,871 $ 4,344 ========= ========= LIABILITIES Current liabilities: Accounts payable and accrued expenses $ 593 $ 608 Unearned revenue 653 858 Current portion of notes payable 47 82 Current portion of capital lease obligation - 63 --------- --------- Total current liabilities 1,293 1,611 --------- --------- Long-term liabilities: Capital lease obligation - 793 Notes payable 41 78 --------- --------- Total long-term liabilities 41 871 --------- --------- Shareholders' equity: Common stock 47 47 Additional paid in capital 9,648 9,644 Accumulated deficit (6,239) (7,833) Cumulative translation adjustment 81 4 --------- --------- Total shareholders' equity 3,537 1,862 --------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 4,871 $ 4,344 ========= ========= PREMIS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Nine Months Ended December 31, ------------------------ 1998 1997 -------- -------- OPERATING ACTIVITIES Net income (loss) $ 1,593 $ (1,462) Adjustments to reconcile net income to net cash (used in) provided by operating activities: Depreciation and amortization 250 254 Gain on sale of fixed assets (86) - Proceeds from note receivable 77 68 Changes in assets and liabilities: Current assets 586 1,890 Current liabilities (161) (475) -------- -------- Net cash provided by operating activities 2,259 275 -------- -------- INVESTING ACTIVITIES Proceeds from the sale of property and equipment 16 - Purchase of property and equipment (147) (166) -------- -------- Net cash provided by (used in) investing activities (131) (166) -------- -------- FINANCING ACTIVITIES Proceeds from the exercise of common stock options 4 2 Proceeds from note payable - 47 Repayment of bank line of credit - (194) Repurchase of common stock - (61) Capital lease obligations (46) (41) Repayment of debt (63) (154) -------- -------- Net cash (used in) financing activities (105) (401) -------- -------- Effect of exchange rate changes on cash 57 (2) Net increase in cash and cash equivalents 2,080 (294) Cash and cash equivalents, beginning of fiscal year 1,360 2,433 -------- -------- Cash and cash equivalents, end of period $ 3,440 $ 2,139 ======== ======== PREMIS CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS UNAUDITED 1. BASIS OF PRESENTATION The accompanying condensed consolidated financial statements have been prepared by the Company without audit, with the exception of the balance sheet for March 31, 1998, which was derived from audited financial statements, and reflect all adjustments (consisting only of normal and recurring adjustments and accruals) which are, in the opinion of management, necessary to present a fair statement of the results for the interim periods presented. The statements have been prepared in accordance with the regulations of the Securities and Exchange Commission, but omit certain information and footnote disclosures necessary to present the statements in accordance with generally accepted accounting principles. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the full fiscal year. These condensed consolidated financial statements should be read in conjunction with the Financial Statements and footnotes thereto included as an exhibit to the Company's Annual 10-KSB Report for the fiscal year ended March 31, 1998. 2. PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. 3. NET INCOME (LOSS) PER SHARE In February 1997, the Financial Accounting Standards Board issued Statement No. 128, "Earnings Per Share", which was adopted on December 31, 1997. All earnings (loss) per share amounts for all periods have been presented, and where necessary, restated to conform to the Statement 128 requirements. Shares used in the net income (loss) per share calculation are as follows: Three Months Ended Nine Months Ended December 31, December 31, ------------------ ----------------- 1998 1997 1998 1997 ---- ---- ---- ---- Shares in (000's) used to compute: Basic earnings (loss) per share 4,734 4,714 4,732 4,714 Dilutive common stock equivalents -- -- 98 -- ----- ----- ----- ----- Dilutive earnings (loss) per share 4,734 4,714 4,830 4,714 ===== ===== ===== ===== Basic earnings (loss) per share is computed on the basis of the weighted average number of common shares outstanding. Diluted earnings (loss) per share does not include the effect of outstanding stock options and warrants in a loss period as they are anti-dilutive. 4. COMPREHENSIVE INCOME (LOSS) The Company adopted Statement of Financial Accounting Standards No. 130, Reporting Comprehensive Income ("SFAS No. 130"), effective April 1, 1998. SFAS No. 130 requires that items defined as other comprehensive income, such as foreign currency translation adjustments, be separately classified in the financial statements and that the accumulated balance of other comprehensive income be reported separately from retained earnings and additional paid-in capital in the equity section of the balance sheet. The components of comprehensive income for the three and six months ended December 31, 1998 and 1997 (in 000's) are as follows: Three Months Ended Nine Months Ended December 31, December 31, ------------------ ----------------- 1998 1997 1998 1997 ---- ---- ---- ---- Comprehensive income (loss): Net income (loss) $(161) $(808) $ 1,593 $(1,462) Other comprehensive income (loss): Foreign currency translation adjustments (12) 2 77 (2) ----- ----- ------- ------- Comprehensive income (loss) $(173) $(806) $ 1,670 $(1,464) ===== ===== ======= ======= 5. SEGMENT DISCLOSURES The Company adopted Statement of Financial Accounting Standards No. 131, Disclosures about Segments of an Enterprise and Related Information ("SFAS No. 131"), effective April 1, 1998. SFAS No. 131 requires public companies to report certain information about operating segments in their financial statements, and establishes related disclosures about products and services, geographic areas and major customers. SFAS No. 131 does not need to be applied to interim financial statements in the initial year of application; however, comparative information for interim periods in the initial year of application will be reported in the financial statements for interim periods in fiscal 2000. 6. SOFTWARE REVENUE RECOGNITION In November 1997, the Financial Accounting Standards Board issued Statement of Position ("SOP") 97-2 "Software Revenue Recognition" to replace SOP-91-1. The Company adopted SOP 97-2 in the first quarter of fiscal 1999 and it has not had a material impact on revenue recognition in fiscal 1999, to date. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Forward-Looking Statements The statements included in this Management's Discussion and Analysis of Financial Condition and Results of Operations, except for the historical information contained herein, are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created by that statute. Such statements are subject to certain risks and uncertainties, some of which are discussed below. Other factors that could cause actual results to differ materially from those described in the forward-looking statements include: volatility in the demand and price for retail software systems; the risk of postponement of delivery dates and corresponding payment dates for system orders; the risk of order cancellations; the risk of delays in introducing new software products; and the market's acceptance of such products. Readers are cautioned not to place undue reliance on the forward-looking statements contained in this Report, since such statements necessarily reflect the knowledge and belief of the Company which speak as to matters only as of the date hereof. The Company does not undertake, and shall have no obligation, to publicly release the results of any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Results of Operations Revenue. The Company's revenues are divided into two categories: systems revenues and maintenance and other services revenues. Systems revenues are composed principally of software license, hardware, long-term system development contracts and U.S. Postal Service ("USPS") site installation revenues. Maintenance fees and other revenue are composed principally of system maintenance contracts. The Company records revenues from software licenses, hardware and site installations upon the completion of services and customer acceptance. Revenues under long-term system development contracts are recognized over the period the Company satisfies its obligation using the percentage-of-completion method of accounting. Progress on the contracts is measured by the percentage of cost incurred to date to the total estimated cost of each contract. Revenues derived from system maintenance contracts are deferred and recognized ratably over the contract period, which is typically twelve months. Total revenues decreased by 40 percent to $724,000 for the third quarter of fiscal 1999, down from $1,204,000 in the same period of fiscal 1998. For the nine months ended December 31, 1998, total revenues increased 3 percent to $5,052,000 from $4,923,000 in fiscal 1998. Systems revenues for the nine month period ended December 31, 1998 included license fees of $3,250,000 under an agreement with NCR Corporation permitting NCR to employ PREMIS' commercial OpenStore technology in the U. S. Postal Service's POS ONE program. For the nine month period ended December 31, 1998, maintenance and other services revenues declined 42 percent to $739,000 from $1,283,000. The Company derives a substantial amount of its revenues from a small number of customers. Accordingly, the timing of product deliverables and amount of services performed for these customers may cause the Company's systems revenues to fluctuate widely. The Company expects continued volatility in systems revenues throughout the remainder of fiscal 1999. Gross Profit. Gross profit increased to $617,000 in the third quarter of fiscal 1999 up from $496,000 in the same period of fiscal 1998. Gross profit as a percentage of revenue increased to 85 percent in the third quarter of fiscal 1999 from 41 percent in the third quarter of fiscal 1998. Gross profit increased to $4,581,000 for the nine months ended December 31, 1998, up from $2,025,000 in the same period of fiscal 1998. As a percentage of revenue, gross profit was 91 percent and 41 percent for the nine months ended December 31, 1998 and December 31, 1997, respectively. The increase in the margin for both the three and nine months ended December 31, 1998 in absolute dollars and as a percentage of revenue is primarily attributable to the recognition of the $3,250,000 license fee related to the Software License Agreement with NCR Corporation and the sale of custom developed source code during fiscal 1999. The Company expects gross profit to fluctuate widely based on the level and composition of revenues. Selling, General And Administrative. Selling, general and administrative expenses decreased by 38 percent to $494,000 in the second quarter of fiscal 1999 down from $796,000 in the same period of fiscal 1998. Selling, general and administrative expenses decreased by 29% for the nine month period ended December 31, 1998 to $1,580,000, down from $2,217,000 in the same period of fiscal 1998. The decline is primarily attributed to a reduction in administrative personnel and related costs. Research And Development. Research and development expense for the third quarter and nine month period ended December 31, 1998 was $410,000 and $1,522,000, respectively. This compares to $521,000 and $1,355,000 for the three and nine month periods ended December 31, 1997. The increase in research and development expenditures for the three and nine month periods are related to the continued development and enhancement of the PREMIS OpenEnterprise suite of products, which includes PREMIS OpenStore, PREMIS OpenOffice and PREMIS OpenNet. Interest And Other Income. The difference in interest income between periods reflects interest earned on investments, as well as interest earned on the 5-year 12% note receivable in the original amount of $651,000 related to the licensing in fiscal 1997 of ADVANTAGE, the Company's Food Brokerage Technology. Such note is due and payable in monthly installments of $14,481. The interest income is off-set by interest expense on various debt instruments, including the Company's building capital lease obligation. Other income for the three and nine month periods ended December 31, 1998 was primarily due to a gain on the early retirement of the Company's capital lease obligation related to its U.S. operating facility. Such gain was off-set by foreign currency losses resulting from the Canadian subsidiary's investments held in US dollar accounts. These foreign exchange losses were partially off-set by foreign currency gains on US dollar receivables held by the Canadian subsidiary. Other income for the nine month period ended December 31, 1997 was primarily generated from a sub-leasing arrangement for a portion of the Company's U.S. office facility. The sub-leasing arrangement expired on June 30, 1997. Income Tax Expense. Although the Company had net income of $1,593,000 for the nine month period ending December 31, 1998, no income tax expense was recorded, since the Company believes its net operating loss carryforwards and Canadian research and development tax credits are adequate to offset current period earnings. Income tax (benefit) expense was ($46,000) and $2,000 for the nine month periods ended December 31, 1998 and 1997, respectively. The Company has not previously recorded any deferred tax asset and related income tax benefit associated with its accumulated net operating losses or research and development credits. The determination not to record such deferred tax asset in prior periods was based on management's belief that it was not more likely than not that such deferred tax asset would be realized in future periods. The Company had no deferred tax asset or liability recorded as of December 31, 1998. Liquidity and Capital Resources The Company's cash and cash equivalents increased by $2,080,000 from March 31, 1998 to December 31, 1998. The increase resulted from the receipt of a license payment of $3,250,000 under a software license agreement dated August 3, 1998 with NCR Corporation during the second quarter of fiscal 1999. As of December 31, 1998, the Company had working capital of $2,729,000 compared to working capital of $929,000 at March 31, 1998. On February 8, 1998, the Company publicly announced that it will propose the liquidation of the Company to its shareholders. To protect shareholder assets, the Company will wind down its Canadian subsidiary and consolidate its operations in the United States pending a shareholder vote on liquidation of the Company's assets. See Part 2 Item 6(b) for information regarding the Company's decision to seek shareholder approval for the liquidation and dissolution of the Company. Capital expenditures for property and equipment in the first nine months of fiscal 1999 were $147,000. These expenditures primarily consisted of construction related costs for the Company's Canadian office facility. Other capital expenditures consisted of computers and related equipment. Prior to January 1, 1999, the Company occupied its headquarters in Plymouth, Minnesota pursuant to a lease, effective September 1, 1996, with a limited liability partnership controlled by two persons who are officers, directors, and principal shareholders of the Company. The lease provided for approximately 22,000 square feet of space at a minimum monthly base rent of $13,477. As of December 31, 1998, the limited liability partnership sold the entire premises to a third party. In connection with the sale the lease between the Company and the limited liability partnership was terminated. Effective January 1, 1999, the Company entered into a new 36 month lease term with the same third party buyer for approximately 7,000 square feet at a minimum monthly base rent of $4,333. As of January 1, 1999, the Company's Canadian subsidiary entered into a subleasing arrangement with a third party to sublease the subsidiary's entire 19,893 square foot office facility. The term of sublease corresponds to the Canadian subsidiary's original 10 year lease term for such office space. The minimum monthly rental rates for the first twelve months of the sublease are below the original lease rates. Subsequent to the first twelve months the rental rates are either equal to or greater than the original lease rates. Effective January 1, 1999, the Canadian subsidiary entered into a new lease for different premises comprising approximately 8,300 square feet at a minimum monthly rent of CDN$7,463 during calendar 1999, CDN$9,555 during calendar 2000, CDN$10,252 during calendar 2001 and CDN$10,601 for the balance of the lease term. The lease term expires January 30, 2006, with one option to cancel at the end of year 5. Under the software license agreement with NCR Corporation a one-time software license fee will be paid to the Company by NCR in two installments of $3,250,000. The first license fee installment was received during the second quarter of fiscal 1999. The second installment is payable no later than June 1, 1999, but only if NCR receives an order for Phase II application software as part of the POS ONE program, which includes PREMIS OpenStore. As of February 15, 1999 the POS ONE program continues to rollout Phase I systems and an order for Phase II application software has not yet been awarded to NCR. The $6,500,000 one-time license fee exceeds the amount anticipated under the former sub-contract for the POS ONE program. The former sub-contract between the Company and NCR called for a payment of approximately $2.2 million upon the USPS's final acceptance of the application software for Phase I. At its current level of operations, the Company believes that its existing cash and cash equivalents are sufficient to meet the Company's current working capital and capital expenditure requirements through at least the next 12 months. However, see Part 2 Item 6(b) for information regarding the Company's decision to seek shareholder approval for the liquidation and dissolution of the Company. Year 2000 Compliance Background. Some computers, software, and other equipment include programming code in which calendar year data is abbreviated to only two digits. As a result of this design decision, some of these systems could fail to operate or fail to produce correct results if "00" is interpreted to mean 1900, rather than 2000. These problems are widely expected to increase in frequency and severity as the year 2000 approaches and are commonly referred to as the "Millenium Bug" or "Year 2000 Problem". Assessment. The Year 2000 Problem could affect computers, software, and other equipment used, operated, or maintained by the Company as well as software developed and sold by the Company. Accordingly, the Company is reviewing its internal computer programs and systems and its products to ensure that the programs and systems will be Year 2000 compliant. As more fully described below, the Company presently believes that its internal computer systems and its products are or will be Year 2000 compliant in a timely manner. However, while the estimated cost of these efforts are not expected to be material to the Company's financial position or any year's results of operations, there can be no assurance to this effect. Software Sold to Customers. The Company believes it has substantially identified and resolved all potential Year 2000 Problems with any of the software products which it currently develops and markets. Currently, the Company only develops and markets software products which were originally developed as Year 2000 compliant. However, management also believes that it is not possible to determine with complete certainty that all Year 2000 Problems affecting the Company's software products have been identified or corrected due to complexity of these products and the fact that these products interact with other third party vendor products and operate on computer systems which are not under the Company's control. The Company has previously installed custom software point of sale solutions for retail customers which are not Year 2000 compliant. The Company has or continues to be in discussions with customers regarding options to modify these previously installed systems to comply with Year 2000 requirements. However, the Company does not believe it has any contractual obligation to provide such services to customers of previously installed systems. Any Year 2000 work performed by the Company in connection with previously installed systems is separately contracted for by the customer. To date these customers have decided to either purchase the source code or contract with the Company directly to perform work related to Year 2000 issues. The Company does not consider the Year 2000 obligation with respect to these previously installed systems to be material to its business operations. Internal Infrastructure. The Company believes that it has reviewed and assessed all of the major computers, software applications, and related equipment used in connection with its internal operations that would potentially require modification, upgrade, or replacement to minimize the possibility of a material disruption to its business. The Company's internal review of such systems did not identify any material Year 2000 problems. Systems Other than Information Technology Systems. In addition to computers and related systems, the operations of office and facilities equipment such as fax machines, photocopiers, telephone switches, security systems, and other common devices may be affected by the Year 2000 Problem. The Company is currently assessing the potential effect of, and costs of mitigating, the Year 2000 Problem on its office and facilities equipment. The Company estimates the total cost to the Company of completing any required modifications, upgrades, or replacements of these internal systems will not have a material adverse effect on the Company's business or results of operations. The Company does not have a comprehensive contingency plan with respect to the Year 2000 Problem, but intends to establish such a plan during calendar 1999 as part of its on-going Year 2000 compliance effort. Based on the activities described above, the Company does not believe that the Year 2000 Problem will have a material adverse effect on the Company's business or results of operations. Disclaimer. The discussion of the Company's efforts, and management's expectations, relating to Year 2000 compliance are forward-looking statements. The Company's ability to achieve Year 2000 compliance and the level of incremental costs associated therewith, could be adversely impacted by, among other things, the availability and cost of programming and testing resources, vendors' ability to modify proprietary software, and unanticipated problems identified in ongoing internal compliance reviews. PART 2 - OTHER INFORMATION: ITEM 1. LEGAL PROCEEDINGS In September 1997, the Company commenced legal proceedings against Edward W. Anderson and Robert E. Ferguson, the former owners of REF Retail Systems Corp. ("REF") which the Company acquired on October 1, 1996, seeking damages in an unspecified amount related to alleged breaches of the agreement for the purchase of REF, and related matters. Additionally, the Anderson claim sought to annul and declare void an employment agreement with Mr. Anderson dated October 1, 1996. Mr. Anderson ceased to be employed by the Company as president and chief executive officer of PREMIS Systems Canada Incorporated (formerly, REF) effective July 15, 1997. Mr. Ferguson resigned as an officer, director and employee of REF on October 1, 1996 in connection with the Company's acquisition of REF. The legal proceeding against Mr. Anderson was filed in the United States District Court, District of Minnesota, Fourth Division on September 16, 1997 (Case No. 97-2087 MJD/AJB). The legal proceeding against Mr. Ferguson was filed in the Ontario Court of Justice, General Division on September 22, 1997 (Case No. 97-CV-132581). The Ferguson suit has not been settled as of February 15, 1999. ITEM 2. CHANGES IN SECURITIES None. ITEM 3. DEFAULT UPON SENIOR SECURITIES Not Applicable. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None. ITEM 5. OTHER INFORMATION None. ITEM 6. EXHIBITS AND REPORTS ON FORM 8K (A) EXHIBITS None. (B) REPORTS ON FORM 8-K The Company filed a report on Form 8-K dated February 9, 1999 related to the closing of its Canadian subsidiary and pending shareholder vote on complete liquidation and dissolution of the Company. The Company expects to mail proxy materials to shareholders of record as of March 22, 1999 regarding the proposal for complete liquidation and dissolution of the Company no later than March 22, 1999. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Dated: February 15, 1999 PREMIS CORPORATION (Registrant) /S/ F. T. Biermeier F. T. Biermeier Chairman and Chief Executive Officer /S/ Richard R. Peterson Richard R. Peterson Chief Financial Officer (Principal Financial and Accounting Officer) EX-27 2 ART. 5 FDS FOR 3RD QUARTER 10-QSB
5 1,000 3-MOS MAR-31-1999 DEC-31-1998 3440 0 444 100 6 4021 1009 489 4871 1293 0 47 0 0 3490 4871 724 724 107 107 905 0 27 (202) (42) (161) 0 0 0 (161) (.03) (.03)
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