Exhibit 99.2 ACQUISITION OF SAGE ONLINE, INC. On March 22, 2000, Multex.com, Inc. ("Multex") completed its acquisition of Sage Online, Inc. a Pennsylvania Corporation ("Sage"), pursuant to an Agreement and Plan of Reorganization, dated March 13, 2000...
Exhibit 99.2
ACQUISITION OF SAGE ONLINE, INC.
On March 22, 2000, Xxxxxx.xxx, Inc. ("Multex") completed its acquisition of Sage
Online, Inc. a Pennsylvania Corporation ("Sage"), pursuant to an Agreement and
Plan of Reorganization, dated March 13, 2000 by and between Xxxxxx.xxx, Inc.,
Multex A Acquisition Corp., a wholly-owned subsidiary of Multex ("Merger Sub"),
and Sage and the shareholders of Sage. The acquisition was accomplished through
the merger of Merger Sub with and into Sage. Consideration payable by Xxxxxx was
determined as a result of negotiation between Multex and Sage. The consideration
paid consisted of 354,183 shares of common stock of Multex and $6.0 million in
cash.
The total purchase price for this transaction was approximately $17.1 million.
The difference between the fair market value of Sage's net tangible assets and
the purchase price will be accounted for as goodwill and will be amortized over
ten years, the expected benefit period.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The unaudited Pro Forma Condensed Consolidated Statement of Operations (the "Pro
Forma Statements of Operations") for the year ended December 31, 1999 and the
three months ended March 31, 2000 gives effect to the acquisition of Sage as if
it had occurred on January 1, 1999 and January 1, 2000, respectively. The Pro
Forma Statement of Operations is based on historical results of operations of
Multex and Sage for the year ended December 31, 1999 and three months ended
March 31, 2000. The unaudited Pro Forma Condensed Consolidated Balance Sheet
(the "Pro Forma Balance Sheet") gives effect to the acquisition as if it had
occurred on December 31, 1999.
The Pro Forma Statement of Operations and Pro Forma Balance Sheet and
accompanying notes (the "Pro Forma Financial Information") should be read in
conjunction with and are qualified by the historical financial statements of the
Company and notes thereto.
Xxxxxx.xxx, Inc.
Unaudited Pro Forma Condensed Consolidated Balance Sheet
December 31, 1999
(in thousands)
Xxxxxx.xxx, Inc. Sage Online, Inc. Adjustments Pro Forma
---------------- ----------------- ----------- ---------
Assets
Current assets:
Cash and cash equivalents $ 6,089 $ 84 $ (6,000) (a) $ 173
Marketable securities 33,028 - - 33,028
Accounts receivable, net 10,954 50 - 11,004
Prepaid expenses 1,404 1 - 1,405
Other current assets 1,789 1 - 1,790
------- ------ --------- ---------
Total current assets 53,264 136 (6,000) 47,400
Property and equipment, net 10,863 39 - 10,902
Goodwill - - 17,252 (a) 17,252
Other 1,473 - - 1,473
------- ------ --------- ---------
Total assets $65,600 $ 175 $ 11,252 $ 77,027
======= ====== ========= =========
Liabilities and stockholders' equity (deficit)
Current liabilities:
Note payable $ - $ 124 $ - 124
Accounts payable 5,051 23 - 5,074
Accrued expenses 4,778 70 - 4,848
Deferred revenues 5,691 74 - 5,765
Current portion of capital lease obligations 225 - - 225
------- ------ --------- ---------
Total current liabilities 15,745 291 - 16,036
Capital lease obligations 193 - - 193
Deferred rent 2,431 - - 2,431
Other liabilities 31 - - 31
Preferred Stock, $.01 par value, 5,000,000
shares, none issued and outstanding
at December 31, 1999 - - - -
Common stock, $.01 par value 272 9 (5) (a) 276
Additional paid-in capital 109,564 565 11,257 (a) 121,386
Accumulated deficit (60,141) (690) - (60,831)
Deferred equity consideration (2,431) - - (2,431)
Accumulated other comprehensive loss (64) - - (64)
-------- ----- -------- ---------
Total stockholders' equity (deficit) 47,200 (116) 11,252 58,336
-------- ----- -------- ---------
Total liabilities and stockholders'
equity (deficit) $ 65,600 $ 175 $ 11,252 $ 77,027
======== ===== ======== =========
Xxxxxx.xxx, Inc.
Unaudited Pro Forma Condensed Consolidated Statement of Operations
Year ended December 31, 1999
(in thousands)
Xxxxxx.xxx, Inc. Sage Online, Inc. Adjustments Pro Forma
---------------- ----------------- ----------- ---------
Revenues $ 40,850 $746 $ - $ 41,596
Cost of revenues 10,569 970 - 11,539
--------- ----- ------- ---------
Gross profit 30,281 (224) - 30,057
Operating expenses:
Sales and marketing 26,379 28 - 26,407
Research & development 6,301 - - 6,301
General and administrative 18,414 218 1,725 (b) 20,357
--------- ----- ------- ---------
Total operating expenses 51,094 246 1,725 53,065
--------- ----- ------- ---------
Loss from operations (20,813) (470) (1,725) (23,008)
Other income (expense)
Acquisition expenses (5,713) - - (5,713)
Interest expense (114) (18) - (132)
Interest and investment income 2,359 - - 2,359
--------- ----- ------- ---------
Loss from continuing operations before tax expense) (24,281) (488) (1,725) (26,494)
Income taxes 1,030 1,030
--------- ----- ------- ---------
Loss from operations (25,311) (488) (1,725) (27,524)
Discontinued operations
Income (loss) from discontinued operations 106 - - 106
Gain on sale of discontinued operations, net of taxes 226 - - 226
--------- ----- ------- ---------
332 - - 332
--------- ----- ------- ---------
Net loss (24,979) (488) (1,725) (27,192)
--------- ----- ------- ---------
Redeemable preferred stock dividends 1,188 - - 1,188
--------- ----- ------- ---------
Net loss attributable to common stockholders' ($26,167) ($488) ($1,725) ($28,380)
========= ===== ======= =========
Earnings (loss) per common share - basic and diluted:
Continuing operations, net of redeemable preferred
stock dividends ($1.17) - - ($1.25)
========= ===== ======= =========
Discontinued operations $0.01 - - $0.01
========= ===== ======= =========
Net loss ($1.15) - - ($1.23)
========= ===== ======= =========
Number of shares used in computing basic and diluted
loss per share 22,688 - 354 23,042
========= ===== ======= =========
Xxxxxx.xxx, Inc.
Unaudited Pro Forma Condensed Consolidated Statement of
Operations
Three Months Ended March 31, 2000
(in thousands)
Xxxxxx.xxx, Inc. Sage Online, Inc. Adjustments Pro Forma
---------------- ----------------- ----------- ---------
Revenues $ 16,083 $ 253 $ - $16,336
Cost of revenues 3,968 1,114 - 5,082
-------- -------- -------- -------
Gross profit 12,115 (861) - 11,254
Operating expenses:
Sales and marketing 6,240 3 - 6,243
Research & development 2,255 - - 2,255
General and administrative 6,347 98 431 (b) 6,876
-------- -------- -------- -------
Total operating expenses 14,842 101 431 15,374
-------- -------- -------- -------
Loss from operations (2,727) (962) (431) (4,120)
Other income (expense)
Acquisition expenses 710 - - 710
Interest expense (13) (24) - (37)
Interest and investment income - - - -
-------- -------- -------- -------
Loss from continuing operations before tax expense) (2,030) (986) (431) (3,447)
Income taxes (47) (47)
-------- -------- -------- -------
Net loss ($2,077) ($986) ($431) ($3,494)
======== ======== ======== =======
Earnings (loss) per common share - basic and diluted:
Net loss ($0.07) - - ($0.12)
======== ======== ======== =======
Number of shares used in computed basic and diluted loss
per share 28,297 - 354 28,651
======== ======== ======== =======
PRO FORMA ADJUSTMENTS AND ASSUMPTIONS
(a) On March 22, 2000, Xxxxxx.xxx, Inc. ("Multex") acquired Sage Online, Inc.
("Sage") for approximately $17.1 million including acquisition costs pursuant to
the Agreement and Plan of Merger dated March 13, 2000 (the "Sage Merger
Agreement"), among Multex, Sage and the shareholders of Sage. Pursuant to the
terms of the Sage Merger Agreement, Sage merged with and into Multex and became
a wholly-owned subsidiary of Multex. The acquisition will be accounted for as a
purchase business combination. The consideration payable by Multex in connection
with the acquisition of Sage consisted of the following: 354,183 shares of
Multex
common stock valued at $11 million and $6.0 million in cash . The Company also
incurred acquisition costs of approximately $100,000.
The following represents the allocation of the purchase price over the
historical net book value of the acquired assets and liabilities of Sage at
December 31, 1999, and is for illustrative pro forma purposes only. Actual fair
values have been based on financial information as of the acquisition date
(March 22, 2000), which are not expected to be significantly different from the
historical net book value of the acquired assets and liabilities. Assuming the
transaction occurred on December 31, 1999, the allocation would have been as
follows:
Assets acquired:
Cash and cash equivalents $ 84,202
Accounts receivable 49,584
Prepaid expenses and other
current assets 1,895
Property and equipment 39,126
Goodwill 17,252,320
-----------
17,427,127
Liabilities assumed (290,785)
------------
$ 17,136,342
============
This allocation is preliminary and my be subject to change upon evaluation of
the fair value of Sage's acquired assets and liabilities as of the acquisition
date as well as the potential identification of certain intangible assets.
The Pro Forma adjustment reconciles the historical balance sheet of Sage at
December 31, 1999 to the allocated purchase price assuming the transaction had
occurred on December 31, 1999.
(b) Goodwill will be amortized over a period of 10 years, the expected period
of benefit. The Pro Forma adjustment to the Pro Forma Statement of Operations
reflects twelve months of amortization expense for the year ended December 31,
1999, assuming the transaction occurred on January 1, 1999. The Pro Forma
adjustment to the Pro Forma Statement of Operations reflects three months of
amortization expense for the three months ended March 31, 2000.
