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Visio Corp · 10-Q · For 6/30/98

Filed On 8/17/98   ·   Accession Number 1032210-98-950   ·   SEC File 0-26772

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  As Of                Filer                Filing    For/On/As Docs:Size              Issuer               Agent

 8/17/98  Visio Corp                        10-Q        6/30/98    2:60K                                    Donnelley R R & S..Co/FA

Quarterly Report   —   Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Form 10-Q for Quarter Ending 06/30/1998               23    109K 
 2: EX-27.1     Financial Data Schedule                                2      5K 


10-Q   —   Form 10-Q for Quarter Ending 06/30/1998
Document Table of Contents

Page (sequential) | (alphabetic) Top
 
11st Page   -   Filing Submission
2Item 1. Financial Statements
95. Subsequent Events
11Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
12Revenues
15Cost of revenues
16Research and development
17Sales and marketing
"General and administrative
18Acquired technology
19Interest and other income, net
21Item 5. Other Information
"Item 6. Exhibits and Reports on Form 8-K
22Signatures
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=============================================================================== SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ____________________ FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1998 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NUMBER 0-26772 VISIO CORPORATION (Exact name of registrant as specified in its charter) WASHINGTON 91-1448389 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 520 PIKE STREET, SUITE 1800, SEATTLE, WASHINGTON 98101-4001 (Address of principal executive offices) (Zip code) (206) 521-4500 (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, as of the latest practicable date: Class Shares outstanding as of July 31, 1998 -------------------------------- --------------------------------------------- Common Stock ($.01 par value) 29,916,896 ===============================================================================
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VISIO CORPORATION FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1998 TABLE OF CONTENTS PART I. FINANCIAL INFORMATION [Enlarge/Download Table] PAGE ----  ITEM 1. FINANCIAL STATEMENTS Balance Sheets as of June 30, 1998 and September 30, 1997......................... 2 Statements of Income for the three and nine months ended June 30, 1998 and 1997... 3 Statements of Cash Flows for the nine months ended June 30, 1998 and 1997......... 4 Notes to Financial Statements..................................................... 5 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS............................................... 10 PART II. OTHER INFORMATION ITEM 5. OTHER INFORMATION................................................................. 20 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.................................................. 20 SIGNATURES................................................................................. 21
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PART I. FINANCIAL INFORMATION  ITEM 1. FINANCIAL STATEMENTS VISIO CORPORATION BALANCE SHEETS (IN THOUSANDS) [Enlarge/Download Table] JUNE 30, SEPTEMBER 30, 1998 1997 ----------- ------------- (UNAUDITED) Assets Current assets: Cash and short-term investments...................................... $105,930 $ 79,594 Accounts receivable.................................................. 12,970 6,360 Inventories.......................................................... 1,085 1,079 Prepaid expenses..................................................... 6,683 3,991 Deferred income taxes................................................ 8,295 7,291 -------- -------- Total current assets................................................ 134,963 98,315 Equipment and leasehold improvements.................................. 9,501 8,039 Capitalized technology................................................ 4,976 2,861 -------- -------- Total assets...................................................... $149,440 $109,215 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable..................................................... $ 5,938 $ 5,954 Accrued compensation and benefits.................................... 5,278 2,706 Other accrued liabilities............................................ 14,694 10,717 Deferred revenue..................................................... 7,487 8,998 Income taxes payable................................................. 2,777 2,988 Current portion of notes payable..................................... 763 1,024 -------- -------- Total current liabilities........................................... 36,937 32,387 -------- -------- Shareholders' equity: Common stock......................................................... 67,816 52,258 Retained earnings.................................................... 44,687 24,570 -------- -------- Total shareholders' equity.......................................... 112,503 76,828 -------- -------- Total liabilities and shareholders' equity........................ $149,440 $109,215 ======== ======== See accompanying notes. 2
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VISIO CORPORATION STATEMENTS OF INCOME (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) [Enlarge/Download Table] THREE MONTHS ENDED NINE MONTHS ENDED JUNE 30, JUNE 30, ----------------- ----------------- 1998 1997 1998 1997 -------- -------- -------- -------- Revenues............................................... $43,748 $25,805 $120,442 $68,351 Cost of revenues....................................... 4,080 2,731 11,037 7,099 ------- ------- -------- ------- Gross profit........................................... 39,668 23,074 109,405 61,252 ------- ------- -------- ------- Operating expenses: Research and development.............................. 6,708 4,175 19,050 10,339 Sales and marketing................................... 18,072 9,988 49,616 26,791 General and administrative............................ 2,999 1,899 8,601 5,081 Acquired technology................................... 976 3,558 8,066 10,255 ------- ------- -------- ------- Total operating expenses............................ 28,755 19,620 85,333 52,466 ------- ------- -------- ------- Operating income....................................... 10,913 3,454 24,072 8,786 Interest and other income, net......................... 1,235 987 3,739 2,229 ------- ------- -------- ------- Income before income taxes............................. 12,148 4,441 27,811 11,015 Provision for income taxes............................. 3,158 1,155 7,232 2,864 ------- ------- -------- ------- Net income............................................. $ 8,990 $ 3,286 $ 20,579 $ 8,151 ======= ======= ======== ======= Basic earnings per share............................... $0.31 $0.12 $0.72 $0.30 ======= ======= ======== ======= Shares used in computation of basic earnings per share. 29,318 27,719 28,780 27,374 ======= ======= ======== ======= Diluted earnings per share............................. $0.28 $0.11 $0.66 $0.27 ======= ======= ======== ======= Shares used in computation of diluted earnings per share................................................. 31,552 30,540 31,222 30,267 ======= ======= ======== ======= See accompanying notes. 3
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VISIO CORPORATION STATEMENTS OF CASH FLOWS (IN THOUSANDS) (UNAUDITED) [Enlarge/Download Table] NINE MONTHS ENDED JUNE 30, ----------------------- 1998 1997 --------- --------- CASH FLOWS FROM OPERATIONS: Net income....................................................... $ 20,579 $ 8,151 Adjustments to reconcile net income to net cash from operations: Depreciation and amortization................................... 3,697 1,727 Deferred income taxes........................................... (11) (3,556) Issuance of common stock for acquired technology................ 6,964 - Changes: Accounts receivable........................................... (6,632) (3,050) Inventories................................................... (14) 156 Prepaid expenses.............................................. (3,022) (2,611) Accounts payable.............................................. 29 404 Accrued compensation and benefits............................. 2,552 1,114 Deferred revenue.............................................. (1,495) 2,087 Other accrued liabilities..................................... 4,273 3,576 Income taxes payable.......................................... 2,443 661 -------- -------- Net cash from operations......................................... 29,363 8,659 -------- -------- CASH FLOWS USED FOR INVESTMENTS: Purchases of short-term investments.............................. (34,502) (21,012) Proceeds from maturities of short-term investments............... 25,500 10,815 Purchases of equipment and leasehold improvements................ (5,311) (3,795) Capitalized technology........................................... (2,532) (2,135) -------- -------- Net cash used for investments.................................... (16,845) (16,127) -------- -------- CASH FLOWS FROM FINANCING: Issuance of common stock......................................... 4,893 4,245 Payments on long-term obligations................................ (300) (465) -------- -------- Net cash from financing.......................................... 4,593 3,780 -------- -------- Net increase (decrease) in cash and cash equivalents............... 17,111 (3,688) Effect of exchange rate changes on cash............................ (463) (310) Cash and cash equivalents, beginning............................... 58,222 42,506 -------- -------- Cash and cash equivalents, ending.................................. 74,870 38,508 Short-term investments............................................. 31,060 28,861 -------- -------- Cash and short-term investments.................................... $105,930 $ 67,369 ======== ======== See accompanying notes. 4
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VISIO CORPORATION NOTES TO FINANCIAL STATEMENTS (UNAUDITED) 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The financial statements of Visio Corporation ("Visio" or the "Company") at June 30, 1998 and for the three and nine month periods ended June 30, 1998 and 1997 are unaudited and reflect all adjustments, consisting of only normal recurring items which are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the interim periods. The financial statements should be read in conjunction with the financial statements and notes thereto for the fiscal year ended September 30, 1997 included in Visio's Annual Report on Form 10-K. The results of operations for the three and nine months ended June 30, 1998 are not necessarily indicative of the results to be expected for the full fiscal year. Certain reclassifications were made to prior interim periods to conform to current period presentation. Visio's fiscal year is a 52/53-week period. Accordingly, all references as of and for the periods ended June 30, 1998, September 30, 1997 and June 30, 1997 reflect amounts as of and for the periods ended July 3, 1998, October 3, 1997 and June 27, 1997, respectively. 2. EARNINGS PER SHARE In February 1997, the Financial Accounting Standards Board ("FASB") issued Statement No.128, Earnings Per Share, which the company has adopted effective for periods ending on or after December 31, 1997. Pursuant to the requirements of Statement No. 128, the Company has changed the method previously used to compute earnings per share and has restated all prior periods whereby the calculation of primary and fully diluted earnings per share have been replaced by basic and diluted earnings per share. Under the new requirements for calculating basic earnings per share, the dilutive effect of stock options and stock warrants are excluded. [Enlarge/Download Table] THREE MONTHS ENDED JUNE 30, ------------------------------------------------ BASIC DILUTED ------------------- ------------------ 1998 1997 1998 1997 ---- ---- ---- ---- (IN THOUSANDS, EXCEPT EARNINGS PER SHARE) Weighted average common shares outstanding................ 29,342 27,966 29,342 27,966 Restricted stock subject to repurchase.................... (24) (247) n/a n/a Net effect of dilutive stock options and warrants calculated using the treasury stock method and the average stock price...................................... n/a n/a 2,210 2,574 ------- ------- ------- ------- Total..................................................... 29,318 27,719 31,552 30,540 ======= ======= ======= ======= Net income................................................ $ 8,990 $ 3,286 $ 8,990 $ 3,286 ======= ======= ======= ======= Earnings per share........................................ $ 0.31 $ 0.12 $ 0.28 $ 0.11 ======= ======= ======= ======= 5
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[Enlarge/Download Table] NINE MONTHS ENDED JUNE 30, ------------------------------------------------- BASIC DILUTED ------------------- ------------------- 1998 1997 1998 1997 ---- ---- ---- ---- (IN THOUSANDS, EXCEPT EARNINGS PER SHARE) Weighted average common shares outstanding................ 28,829 27,718 28,829 27,718 Restricted stock subject to repurchase.................... (49) (344) n/a n/a Net effect of dilutive stock options and warrants calculated using the treasury stock method and the average stock price...................................... n/a n/a 2,393 2,549 ------ ------ ------ ------ Total..................................................... 28,780 27,374 31,222 30,267 ======= ======= ======= ======= Net income................................................ $20,579 $ 8,151 $20,579 $ 8,151 ======= ======= ======= ======= Earnings per share........................................ $ 0.72 $ 0.30 $ 0.66 $ 0.27 ======= ======= ======= ======= 3. INVENTORIES Inventories are stated at the lower of cost or market and consist of the following: JUNE 30, SEPTEMBER 30, 1998 1997 ------- ------------ (IN THOUSANDS) Raw Materials............... $ 503 $ 299 Finished Goods.............. 582 780 ------ ------ $1,085 $1,079 ====== ====== 4. ACQUISITIONS For all acquisitions accounted for under the purchase method, assets are recorded at fair market value plus a pro rata portion of related acquisition costs. The allocation of the purchase price to Acquired Technology or Capitalized Technology is based on known valuation techniques in the software industry. For some transactions, the Company obtains an independent appraisal of the technology. Amounts allocated to Acquired Technology relate to in- process research and development that were immediately expensed in the period of acquisition because technological feasibility was not established and no alternative commercial use was identified. Amounts allocated to Capitalized Technology relate to technology that had achieved technological feasibility at the time of acquisition. Capitalized Technology is amortized on a straight-line basis over the estimated useful life of the technology. On January 22, 1998, the Company acquired MarComp Inc. ("MarComp"), a privately held provider of programming toolkits for access to Autodesk's AutoCAD .dwg and .dxf file formats, located in Parkton, Maryland. Under the terms of the merger agreement, Visio exchanged 50,014 shares of its unregistered common stock for all of the outstanding shares of MarComp. The transaction was accounted for as a pooling of interests and due to the immateriality of the amounts involved, prior period financial statements have not been restated. The transaction resulted in an increase in equity of $100,000 primarily due to the acquisition of cash and accounts receivable from MarComp and resulted in approximately $100,000 in acquisition related costs in the quarter ended March 31, 1998. 6
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On February 10, 1998, the Company acquired certain technology and assets of InfoModelers, Inc. ("InfoModelers"), a privately held, leading supplier of database and data warehouse visual design, access and query tools, located in Bellevue, Washington. Under the terms of the agreement, Visio issued 200,000 shares of its unregistered common stock for accounts receivable, fixed assets, tax assets and certain technology assets. The transaction was accounted for using the purchase method and was valued at approximately $7.8 million for InfoModeler shareholders. This transaction resulted in a total charge to Acquired Technology of $7.0 million that included $6.8 million for in-process research and development and $236,000 of acquisition related costs in the quarter ended March 31, 1998. In addition, the Company recorded approximately $1.0 million in other balance sheet assets. On May 5, 1998, the Company acquired certain technology and assets from Decision Graphics UK Ltd. ("Decision Graphics"), a privately held provider of computer-aided facilities management (CAFM) software, located in the U.K., for $688,000. The transaction was accounted for using the purchase method and resulted in a total charge to Acquired Technology of $729,000 that included $688,000 for in-process research and development and $41,000 of acquisition related costs in the quarter ended June 30, 1998. On June 2, 1998, the Company acquired certain CAD technology, software products and other assets from Ketiv Technologies Inc. ("Ketiv"), a privately held provider of architecture, engineering and construction (AEC) software located in Portland, Oregon, for approximately $2.6 million. The transaction was accounted for using the purchase method and resulted in Capitalized Technology of $2.5 million including acquisition related costs and a total charge to Acquired Technology of $247,000 that included $235,000 for in-process research and development and $12,000 of acquisition related costs. The Capitalized Technology is being amortized on a straight-line basis over five years. On February 21, 1997, the Company acquired certain technology and assets of Boomerang Technology Inc. ("Boomerang"), a privately held developer of Autodesk AutoCAD-compatible software, located in San Diego, California, for $6.7 million. This transaction resulted in a charge to Acquired Technology of $6.7 million for in-process research and development. On May 1, 1997, the Company acquired certain assets of Freedom Solutions Group, Inc. d.b.a. SysDraw Software Company ("SysDraw Software Company"), a privately held network design and documentation solutions provider, located in Lombard, Illinois. Under the terms of the agreement, the acquisition price included $5.5 million in cash plus the issuance of a $1.0 million note payable due August 1998. Visio is required to pay up to $1.5 million of additional consideration if revenues of the acquired products meet certain performance goals within three years of the acquisition. The transaction was accounted for using the purchase method and resulted in Capitalized Technology of $3.1 million, other balance sheet assets of $100,000 and a charge to Acquired Technology of $3.6 million that included $3.3 million for in-process research and development and $300,000 of acquisition related costs. The Capitalized Technology is being amortized on a straight-line basis over five years. The technologies acquired in the MarComp, Boomerang, Decision Graphics and Ketiv transactions are intended for use in the Company's products in the Technical Drawing product group. The technologies acquired in the Sysdraw and InfoModelers transactions are intended for use in the Company's IT Design and Documentation product group. The operating results of MarComp, Boomerang, SysDraw, InfoModelers, Decision Graphics, and Ketiv were not considered material to the consolidated financial statements of Visio, and accordingly, pro forma financial information has not been presented for these acquisitions. 7
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5. SUBSEQUENT EVENTS On July 10, 1998, the Company acquired Kaspia Systems Inc. ("Kaspia"), a privately held developer of fully automated enterprise-network audit functionality, including discovery, monitoring and reporting software, located in Beaverton, Oregon. Under the terms of the merger agreement, Visio acquired all of Kaspia's outstanding stock for 482,994 shares of Visio common stock, valued at approximately $23.3 million for Kaspia shareholders. This transaction will be accounted for as a pooling of interests. Accordingly, the consolidated financial statements will include the combined results of operations beginning in the quarter ended September 30, 1998 and all prior financial statements will be restated. The transaction resulted in approximately $1.2 million in acquisition related costs in the quarter ended September 30, 1998. The following tables reflect restated summarized unaudited financial data of Visio including the historical results of Kaspia: SELECTED UNAUDITED INCOME STATEMENT DATA: [Enlarge/Download Table] FISCAL YEAR 1998 NINE MONTHS THREE MONTHS ENDED ENDED ---------------------------------------- ----------- DECEMBER 31, MARCH 31, JUNE 30, JUNE 30, (in thousands, except per share data) 1997 1998 1998 1998 ------------ --------- -------- ----------- Revenues............................. $37,497 $40,089 $44,186 $121,772 Net income........................... $ 7,378 $ 3,326 $ 8,449 $ 19,153 Diluted earnings per share........... $ 0.24 $ 0.11 $ 0.26 $ 0.60 Shares used in computation of diluted earnings per share.......... 31,395 31,659 32,018 31,691 [Enlarge/Download Table] FISCAL YEAR 1997 FISCAL YEAR THREE MONTHS ENDED ENDED ------------------------------------------------ ------------- (in thousands, except per share data) DECEMBER 31, MARCH 31, JUNE 30, SEPTEMBER 30, SEPTEMBER 30, 1996 1997 1997 1997 1997 ------------ --------- -------- ------------- ------------- Revenues............................. $19,207 $23,812 $26,367 $31,389 $100,775 Net income........................... $ 4,157 $ 216 $ 2,942 $ 6,385 $ 13,700 Diluted earnings per share........... $ 0.14 $ 0.01 $ 0.10 $ 0.20 $ 0.44 Shares used in computation of diluted earnings per share.......... 30,405 30,518 30,943 31,300 30,792 SELECTED UNAUDITED BALANCE SHEET DATA: (in thousands) SEPTEMBER 30, JUNE 30, 1997 1998 ------------- -------- Cash and short-term investments...... $ 81,212 $106,107 Current assets....................... 101,586 138,251 Total assets......................... 112,701 153,048 Current liabilities.................. 33,544 39,269 Shareholders' equity................. 78,767 113,063 Total liabilities and shareholders' equity................ 112,701 153,048 8
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6. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS The Accounting Standards Executive Committee has issued Statement of Position 97-2, "Software Revenue Recognition" ("SOP 97-2"), which supersedes SOP 91-1, the former literature on software revenue recognition. This Statement will be effective beginning in fiscal year 1999. The Company believes it is substantially in compliance with the provisions of SOP 97-2, and its adoption is not expected to have a material impact on the financial position or results of operations of the Company. In June 1997, the FASB issued Statement No. 130, "Reporting Comprehensive Income." Statement No. 130 establishes standards for reporting and displaying comprehensive income and its components in the financial statements which requires the Company to display an amount representing total comprehensive income for the period in its financial statements. The Company will be required to implement Statement No. 130 for its fiscal year 1999. In June 1997, the FASB issued Statement No. 131, "Disclosures about Segments of an Enterprise and Related Information." Statement No. 131 establishes standards for the manner in which public companies report information about operating segments in annual and interim financial statements. The Company will be required to implement Statement No. 131 for its fiscal year 1999. In June 1998, the FASB issued Statement No. 133, "Accounting for Derivative Instruments and Hedging Activities" which is required to be adopted in years beginning after June 15, 1999. Statement No. 133 provides a comprehensive and consistent standard for the recognition and measurement of derivatives and hedging activities. The Company currentely hedges foreign exchange transaction exposures. Management has not yet determined what the effect of Statement No. 133 will be on the earnings and financial position of the Company. 9
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW Visio(R), which commenced operations in September 1990, develops drawing and diagramming software for the general business personal computer user. All of the Company's products have been developed for the Microsoft Windows 3.1, Windows 95, Windows 98 and Windows NT operating systems and are marketed under the Visio brand. The Company's primary products are Visio Standard, Visio Technical, Visio Professional and IntelliCAD(R) 98. The Company's first product, Visio Standard, which shipped in November 1992, began creating a new market for business diagramming. The Company shipped its second major product, Visio Technical, for technical drawing, in November 1994. The Company introduced its third significant product in January 1997, Visio Professional, for information systems and network design and documentation. The company introduced its most recent product in March 1998, IntelliCAD 98, for the computer aided drafting market. When used in this discussion, the words "expects," "believes," "anticipates" and similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Factors which could affect the Company's financial results and cause such results to differ materially from quarter to quarter include but are not limited to fluctuations in quarterly performance, dependence on other products, including Microsoft Windows, competition in the business drawing and diagramming software market, timing and customer acceptance of new products, the Company's ability to manage growth and integrate acquired technology, potential changes in licensing and marketing methods and changes in general economic conditions. Additional information concerning these and other risks is described in the "Certain Risk Factors that may Impact Future Results of Operations" section of the Company's Form 10-K for the fiscal year ended September 30, 1997, and, from time to time, in other reports filed by the Company with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward- looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. ------------------ VISIO and IntelliCAD are registered trademarks of Visio Corporation. 10
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RESULTS OF OPERATIONS The following table sets forth statement of income data as a percentage of revenues for the fiscal periods indicated. [Enlarge/Download Table] THREE MONTHS ENDED NINE MONTHS ENDED JUNE 30, JUNE 30, ------------------------ ------------------------ 1998 1997 1998 1997 ---------- ---------- ---------- ---------- Revenues.......................................... 100.0% 100.0% 100.0% 100.0% Cost of revenues.................................. 9.3 10.6 9.2 10.4 ----- ----- ----- ----- Gross profit...................................... 90.7 89.4 90.8 89.6 ----- ----- ----- ----- Operating expenses: Research and development......................... 15.3 16.2 15.8 15.1 Sales and marketing.............................. 41.3 38.7 41.2 39.2 General and administrative....................... 6.9 7.3 7.1 7.4 Acquired technology.............................. 2.2 13.8 6.7 15.0 ----- ----- ----- ----- Total operating expenses.......................... 65.7 76.0 70.8 76.7 ----- ----- ----- ----- Operating income.................................. 25.0 13.4 20.0 12.9 Interest and other income, net.................... 2.8 3.8 3.1 3.2 ----- ----- ----- ----- Income before income taxes........................ 27.8 17.2 23.1 16.1 Provision for income taxes........................ 7.2 4.5 6.0 4.2 ----- ----- ----- ----- Net income........................................ 20.6% 12.7% 17.1% 11.9% ===== ===== ===== =====  REVENUES Revenues include the license of software products, maintenance and support contracts, net of reserves for estimated future returns and allowances. License revenues are derived from packaged software products, volume licenses, international royalties and certain OEM arrangements. The Company periodically upgrades its products. Revenues from upgrades are cyclical and are typically highest in the periods of and immediately following an upgrade. The last significant upgrade occurred in August 1997 where the Company's three primary products Visio Standard, Visio Technical and Visio Professional were upgraded to version 5.0. Revenues for the third quarter of fiscal 1998 increased 70% over the same quarter in the prior year. Revenues for the nine months ended June 30, 1998 increased 76% over the comparable prior year period. The increase in revenues was due primarily to sales volume growth across product groups, distribution channels and geographic regions. 11
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PRODUCT GROUPS: The following table sets forth revenues by product group with the corresponding percentage of total revenues and the year-to-year percentage change for the fiscal periods indicated. Prior year's figures have been restated for comparability. [Enlarge/Download Table] THREE MONTHS ENDED JUNE 30, ----------------------------------------- 1998 1997 CHANGE -------------- -------------- -------- (DOLLARS IN THOUSANDS) Revenues: Business Diagramming................................. $11,561 26.4% $11,042 42.8% 4.7% Technical Drawing.................................... 10,753 24.6 7,309 28.3 47.1% IT Design and Documentation.......................... 21,434 49.0 7,454 28.9 187.6% ------- ----- ------- ----- ----- Total revenues................................... $43,748 100.0% $25,805 100.0% 69.5% ======= ===== ======= ===== ===== [Enlarge/Download Table] NINE MONTHS ENDED JUNE 30, ----------------------------------------- 1998 1997 CHANGE -------------- -------------- -------- (DOLLARS IN THOUSANDS) Revenues: Business Diagramming................................. $ 35,220 29.2% $33,648 49.2% 4.7% Technical Drawing.................................... 28,483 23.7 21,836 32.0 30.4% IT Design and Documentation.......................... 56,739 47.1 12,867 18.8 341.0% -------- ----- ------- ----- ----- Total revenues................................... $120,442 100.0% $68,351 100.0% 76.2% ======== ===== ======= ===== ===== The Company classifies its products in the following product groups: Visio Standard and Visio Maps in the Business Diagramming product group, Visio Technical and IntelliCAD 98 in the Technical Drawing product group, and Visio Professional, Visio Business Modeler and Visio Network Equipment in the IT Design and Documentation product group. The Company believes that the percentage growth in the Business Diagramming product group has been impacted by cannibalization from Visio Professional. The Company believes that customers who may otherwise have purchased Visio Standard are choosing Visio Professional for its added features and content. Many Visio Standard customers in the past were information technology professionals who can now choose Visio Professional that provides them with more of the functionality they need. The growth in the Technical Drawing product group was primarily due to IntelliCAD 98 that was introduced in March 1998. Revenues from IntelliCAD 98 were approximately $3.0 million or 28% of Technical Drawing revenues in the quarter ended June 30, 1998. The Company believes that the percentage growth in the Technical Drawing product group has also been impacted by cannibalization from Visio Professional. Prior to the release of Visio Professional, Visio Technical had been marketed to the IT professional as the solution for network diagramming. Visio Professional, the Company's first significant product in the IT Design and Documentation product group, significantly impacted the revenue mix within the product groups for the quarter and nine months ended June 30, 1998. Since being introduced in the second quarter of fiscal 1997, Visio Professional has experienced significant growth as the product has been accepted as a viable solution for IT professionals in the design and documentation of their networks, databases, software applications and web sites. Also contributing to the growth of Visio Professional is the growth of the IT design and documentation market as a whole. 12
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SALES CHANNELS: The following table sets forth revenues by sales channel with the corresponding percentage of total revenues and the year-to-year percentage change for the fiscal periods indicated. [Enlarge/Download Table] THREE MONTHS ENDED JUNE 30, ----------------------------------------- 1998 1997 CHANGE -------------- -------------- ------ (DOLLARS IN THOUSANDS) Revenues: Distribution.............................. $29,901 68.3% $19,264 74.7% 55.2% Direct.................................... 2,614 6.0 1,424 5.5 83.6% Volume Licensing.......................... 11,218 25.6 4,775 18.5 134.9% OEM....................................... 15 0.1 342 1.3 (95.6)% ------- ----- ------- ----- ----- Total revenues........................ $43,748 100.0% $25,805 100.0% 69.5% ======= ===== ======= ===== ===== [Enlarge/Download Table] NINE MONTHS ENDED JUNE 30, ----------------------------------------- 1998 1997 CHANGE -------------- -------------- ------ (DOLLARS IN THOUSANDS) Revenues: Distribution.............................. $ 84,179 69.9% $50,798 74.3% 65.7% Direct.................................... 9,259 7.7 4,558 6.7 103.1% Volume Licensing.......................... 26,892 22.3 12,167 17.8 121.0% OEM....................................... 112 0.1 828 1.2 (86.5)% -------- ----- ------- ----- ----- Total revenues........................ $120,442 100.0% $68,351 100.0% 76.2% ======== ===== ======= ===== ===== Visio classifies its revenues in four sales channels: "Distribution," "Direct," "Volume Licensing," and "OEM." Distribution revenues represent sales of packaged products through national distributors and corporate, retail and mail order resellers. Direct revenues represent sales of packaged products directly by the Company, including upgrades, generally to end users responding to advertising or marketing promotions. Volume Licensing revenues are derived from volume licenses, which are generally administered through corporate resellers after the Company's sales staff has negotiated the sale. The sales cycle for a volume license can extend up to eighteen months on significant volume licenses as organizations can require extensive time to evaluate and consider a large-scale implementation. Volume Licensing revenues usually do not include any significant amount of packaged goods, but do include maintenance and support revenues, which are priced separately and recognized over the lives of the contracts. OEM revenues include licenses of Visio products to hardware and software manufacturers for bundling arrangements. OEM revenues include packaged product sales, as well as royalty payments with no associated product costs. Growth in absolute terms in both the Distribution and Direct channel was primarily driven by the strength of the IT Design and Documentation product group as well as revenue from the version 5.0 upgrade. Volume Licensing channel revenues grew 135% for the three month period ended June 30, 1998, over the comparable period in fiscal 1997. This strong growth reflects continued investment in the corporate sales force and the Volume Licensing programs. The company has increased its staff in the corporate sales department from 31 at June 30, 1997 to 62 at June 30, 1998. 13
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GEOGRAPHY: The following table sets forth revenues by geography with the corresponding percentage of total revenues and the year-to-year percentage change for the fiscal periods indicated. THREE MONTHS ENDED JUNE 30, ----------------------------------------- 1998 1997 CHANGE -------------- -------------- ------ (DOLLARS IN THOUSANDS) Revenues: North America.................. $27,047 61.8% $17,039 66.0% 58.7% Europe......................... 10,355 23.7 5,533 21.5 87.1% Rest of World.................. 6,346 14.5 3,233 12.5 96.3% ------- ----- ------- ----- ---- Total international...... 16,701 38.2 8,766 34.0 90.5% ------- ----- ------- ----- ---- Total revenues............. $43,748 100.0% $25,805 100.0% 69.5% ======= ===== ======= ===== ==== NINE MONTHS ENDED JUNE 30, ----------------------------------------- 1998 1997 CHANGE -------------- -------------- ------ (DOLLARS IN THOUSANDS) Revenues: North America.................. $ 70,396 58.4% $42,841 62.7% 64.3% Europe......................... 30,600 25.4 15,756 23.0 94.2% Rest of World.................. 19,446 16.2 9,754 14.3 99.4% -------- ----- ------- ----- ---- Total international...... 50,046 41.6 25,510 37.3 96.2% -------- ----- ------- ----- ---- Total revenues............. $120,442 100.0% $68,351 100.0% 76.2% ======== ===== ======= ===== ==== Revenues in the U.S. and Canada for the quarter ended June 30, 1998 increased in absolute terms over the comparable period of fiscal 1997 primarily due to the growth of the IT Design and Documentation product group, the upgrade to version 5.0 and the increase in Volume Licensing. International revenues for the quarter ended June 30, 1998, increased in absolute terms and as a percentage of total revenues over the comparable period of fiscal 1997, primarily due to the growth of the IT Design and Documentation product group, the upgrade to version 5.0, an increase in Volume Licensing and continued investment in international markets. For the quarter and nine months ended June 30, 1998, the growth in Rest of World was partially offset by general weakened economic conditions and foreign currency fluctuations in Japan and Southeast Asia. These economic and currency conditions may continue to negatively impact revenue and operating results in the Rest of World region in upcoming periods.  COST OF REVENUES The following table sets forth cost of revenues with the corresponding percentage of revenues and year-to-year percentage change for the fiscal periods indicated. JUNE 30, ------------------------------------------------- 1998 1997 CHANGE -------------- ----------------- ------ (DOLLARS IN THOUSANDS) Three months ended......... $ 4,080 9.3% $2,731 10.6% 49.4% Nine months ended.......... $11,037 9.2% $7,099 10.4% 55.5% Cost of revenues varies with the mix of Distribution, Direct, Volume Licensing and OEM revenues, due to relative variations in the standard product costs associated with each revenue category, and with fluctuations in 14
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period costs. Standard product costs consist primarily of documentation, packaging, media duplication, assembly and material management costs. Period costs consist primarily of certain royalties, technical support, production management, freight and fulfillment, amortization of capitalized technology, standard material variances and inventory valuation adjustments. Standard costs associated with each revenue category are primarily determined by the amount of packaged product delivered in that revenue category. Accordingly, most of the Company's standard costs are associated with Distribution and Direct revenues, the majority of which are derived from sales of packaged products. Volume Licensing revenues have the lowest standard cost because they generally do not include any substantive amount of packaged goods. The decrease in cost of revenues as a percentage of revenues for the three and nine month periods of fiscal 1998 over the comparable periods of fiscal 1997 resulted from the increased use of lower cost CD-ROM media and other raw material cost reductions, an increase in the percentage of revenue from Visio Professional, Visio Technical, and IntelliCAD 98 which have lower standard product costs as a percentage of revenues than Visio Standard and increased Volume Licensing revenues which have little or no standard product costs. These decreases were partially offset by increased royalty costs for licensed technology including Visual Basic for Applications (VBA) from Microsoft Corporation and increased amortization costs of capitalized technology. The Company expects its cost of revenues as a percentage of revenues to increase due to expected increases in technical support costs associated with the Company's new computer-aided drafting product, IntelliCAD 98 as well as support for other future products of more complexity, and increased amortization of Capitalized Technology from recent acquisitions.  RESEARCH AND DEVELOPMENT The following table sets forth research and development expenses with the corresponding percentage of revenues and year-to-year percentage change for the fiscal periods indicated. [Download Table] JUNE 30, ------------------------------------------------- 1998 1997 CHANGE -------------- ----------------- ------ (DOLLARS IN THOUSANDS) Three months ended......... $ 6,708 15.3% $ 4,175 16.2% 60.7% Nine months ended.......... $19,050 15.8% $10,339 15.1% 84.3% Research and development expenses consist primarily of personnel, contract services, occupancy and equipment costs required to conduct the Company's product development efforts. Product development includes product engineering, documentation development, localization, usability testing, quality assurance and advanced research and development costs. Product localization costs and lump sum payments for technology such as file converters are capitalized and amortized to development over the lesser of the useful life or 18 months. Research and development expenses are charged to operations as incurred. The Company has not capitalized certain software development costs subsequent to the establishment of technological feasibility, as these costs have been immaterial. Increases in research and development expenses in absolute terms for the three and nine month periods ended June 30, 1998 over the corresponding periods of fiscal 1997 resulted primarily from planned additions to the Company's development organization and the addition of engineering personnel that joined the Company as part of the acquisitions completed during these time periods. The Company believes it will be necessary to continue to increase research and development spending on an absolute basis in order to continue to maintain a competitive technological position as well as continue to expand its product line and the number of localized language versions. 15
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SALES AND MARKETING The following table sets forth sales and marketing expenses with the corresponding percentage of revenues and year-to-year percentage change for the fiscal periods indicated. [Enlarge/Download Table] JUNE 30, ------------------------------------------------------------------------- 1998 1997 CHANGE ------------------------ -------------------------- -------- (DOLLARS IN THOUSANDS) Three months ended......... $18,072 41.3% $ 9,988 38.7% 80.9% Nine months ended.......... $49,616 41.2% $26,791 39.2% 85.2% Sales and marketing expenses have increased in absolute terms as the Company continues building its worldwide sales, marketing and customer service infrastructure. The increase in sales and marketing expenses in absolute terms and as a percentage of revenue for the three and nine month periods ended June 30, 1998 over the comparable periods in fiscal 1997 was primarily due to expansion in international markets, increased product marketing costs to support new products and upgrades to existing products and investment in the corporate sales force and the Volume Licensing programs. The Company believes substantial spending on marketing awareness and corporate sales staffing is essential to achieve revenue growth and to maintain and enhance the Company's competitive position. Accordingly, Visio expects sales and marketing expenses will continue to increase in absolute terms over time.  GENERAL AND ADMINISTRATIVE The following table sets forth general and administrative expenses with the corresponding percentage of revenues and year-to-year percentage change for the fiscal periods indicated. [Enlarge/Download Table] JUNE 30, ------------------------------------------------------------------------ 1998 1997 CHANGE ------------------------ -------------------------- ------ (DOLLARS IN THOUSANDS) Three months ended......... $2,999 6.9% $1,899 7.3% 57.9% Nine months ended.......... $8,601 7.1% $5,081 7.4% 69.3% General and administrative expenses increased in absolute terms in both the third quarter and nine months of fiscal 1998 over the corresponding periods of fiscal 1997 primarily due to increased staffing to support the Company's growth as well as growth in Visio's operational headquarters in the Asia Pacific region. The Company expects to show increased general and administrative expenses in absolute terms in future periods for infrastructure to support the Company's revenue growth. 16
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ACQUIRED TECHNOLOGY The following table sets forth acquired technology expenses related to recent acquisitions with the corresponding percentage of revenues and year-to- year percentage change for the fiscal periods indicated. [Enlarge/Download Table] JUNE 30, ------------------------------------------------------------------------- 1998 1997 CHANGE ------------------------ -------------------------- ------ (DOLLARS IN THOUSANDS) Three months ended......... $ 976 2.2% $ 3,558 13.8% (72.6)% Nine months ended.......... $8,066 6.7% $10,255 15.0% (21.3)% On January 22, 1998, the Company acquired MarComp Inc. ("MarComp"), a privately held provider of programming toolkits for access to Autodesk's AutoCAD .dwg and .dxf file formats, located in Parkton, Maryland. Under the terms of the merger agreement, Visio exchanged 50,014 shares of its unregistered common stock for all of the outstanding shares of MarComp. The transaction was accounted for as a pooling of interests and due to the immateriality of the amounts involved, prior period financial statements have not been restated. The transaction resulted in an increase in equity of $100,000 primarily due to the acquisition of cash and accounts receivable from MarComp and resulted in approximately $100,000 in acquisition related costs in the quarter ended March 31, 1998. On February 10, 1998, the Company acquired certain technology and assets of InfoModelers, Inc. ("InfoModelers"), a privately held, leading supplier of database and data warehouse visual design, access and query tools, located in Bellevue, Washington. Under the terms of the agreement, Visio issued 200,000 shares of its unregistered common stock for accounts receivable, fixed assets, tax assets and certain technology assets. The transaction was accounted for using the purchase method and was valued at approximately $7.8 million for InfoModeler shareholders. This transaction resulted in a total charge to Acquired Technology of $7.0 million that included $6.8 million for in-process research and development and $236,000 of acquisition related costs in the quarter ended March 31, 1998. In addition, the Company recorded approximately $1.0 million in other balance sheet assets. On May 5, 1998, the Company acquired certain technology and assets from Decision Graphics UK Ltd. ("Decision Graphics"), a privately held provider of computer-aided facilities management (CAFM) software, located in the U.K., for $688,000. The transaction was accounted for using the purchase method and resulted in a total charge to Acquired Technology of $729,000 that included $688,000 for in-process research and development and $41,000 of acquisition related costs in the quarter ended June 30, 1998. On June 2, 1998, the Company acquired certain CAD technology, software products and other assets from Ketiv Technologies Inc. ("Ketiv"), a privately held provider of architecture, engineering and construction (AEC) software located in Portland, Oregon, for approximately $2.6 million. The transaction was accounted for using the purchase method and resulted in Capitalized Technology of $2.5 million including acquisition related costs and a total charge to Acquired Technology of $247,000 that included $235,000 for in-process research and development and $12,000 of acquisition related costs. The Capitalized Technology is being amortized on a straight-line basis over five years. On February 21, 1997, the Company acquired certain technology and assets of Boomerang Technology Inc. ("Boomerang"), a privately held developer of Autodesk AutoCAD-compatible software, located in San Diego, California, for $6.7 million. This transaction resulted in a charge to Acquired Technology of $6.7 million for in-process research and development. 17
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On May 1, 1997, the Company acquired certain assets of Freedom Solutions Group, Inc. d.b.a. SysDraw Software Company ("SysDraw Software Company"), a privately held network design and documentation solutions provider, located in Lombard, Illinois. Under the terms of the agreement, the acquisition price included $5.5 million in cash plus the issuance of a $1.0 million note payable due August 1998. Visio is required to pay up to $1.5 million of additional consideration if revenues of the acquired products meet certain performance goals within three years of the acquisition. The transaction was accounted for using the purchase method and resulted in Capitalized Technology of $3.1 million, other balance sheet assets of $100,000 and a charge to Acquired Technology of $3.6 million that included $3.3 million for in-process research and development and $300,000 of acquisition related costs. The Capitalized Technology is being amortized on a straight-line basis over five years.  INTEREST AND OTHER INCOME, NET Interest income for the third quarter of fiscal 1998 of $1.2 million increased 25% over the third quarter of fiscal 1997. Interest income for the nine months ended June 30, 1998 of $3.7 million increased 68% over the comparable period of fiscal 1997. The increase in fiscal 1998 was primarily due to a larger cash and short-term investment balance. Other income includes grant income from the Industrial Development Agency of Ireland and foreign currency transaction gains and losses. Visio currently hedges certain foreign exchange transaction exposures. To the extent the Company has assets and liabilities denominated in foreign currencies that are not hedged, the Company is subject to foreign currency gains and losses. INCOME TAXES The Company's effective income tax rate was 26% for both the fiscal 1998 and fiscal 1997 periods. LIQUIDITY AND CAPITAL RESOURCES At June 30, 1998, the Company had cash and short-term investments totaling $105.9 million, an increase of $26.3 million from September 30, 1997. The increase in cash and short-term investments was due primarily to cash generated from operations and cash proceeds from the issuance of shares through the employee stock option program. At June 30, 1998, the Company's principal commitments consisted primarily of leases on its facilities. The Company's capital expenditures totaled $5.3 million in the first nine months of fiscal 1998. At June 30,1998, the Company had commitments for approximately $8.0 million to be paid over the next nine months related to tenant improvements associated with the Company's new headquarters building. The Company believes that its current cash balances and cash flows from operations will be sufficient to meet its working capital and capital expenditure requirements for at least the next 12 months. From time to time, the Company evaluates potential acquisitions of businesses, products or technologies that complement the Company's business. At June 30, 1998, except for the acquisition of Kaspia Systems, Inc. ("Kaspia") described in "Subsequest Events", the Company had no material agreements or commitments with respect to any such transactions. 18
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SUBSEQUENT EVENTS On July 10, 1998, the Company acquired Kaspia, a privately held developer of fully automated enterprise-network audit functionality, including discovery, monitoring and reporting software, located in Beaverton, Oregon. Under the terms of the merger agreement, Visio acquired all of Kaspia's outstanding stock for 482,994 shares of Visio common stock, valued at approximately $23.3 million for Kaspia shareholders. This transaction will be accounted for as a pooling of interests. The transaction resulted in acquisition related charges of approximately $1.2 million that will be expensed in the quarter ended September 30, 1998. See "Notes to Financial Statements -- 5. Subsequent Events." RECENTLY ISSUED ACCOUNTING STANDARDS The Accounting Standards Executive Committee has issued Statement of Position 97-2, "Software Revenue Recognition" ("SOP 97-2"), which supersedes SOP 91-1, the former literature on software revenue recognition. This Statement will be effective beginning in fiscal year 1999. The Company believes it is substantially in compliance with the provisions of SOP 97-2, and its adoption is not expected to have a material impact on the financial position or results of operations of the Company. In June 1997, the FASB issued Statement No. 130, "Reporting Comprehensive Income." Statement No. 130 establishes standards for reporting and displaying comprehensive income and its components in the financial statements which requires the Company to display an amount representing total comprehensive income for the period in its financial statements. The Company will be required to implement Statement No. 130 for its fiscal year 1999. In June 1997, the FASB issued Statement No. 131, "Disclosures About Segments of an Enterprise and Related Information." Statement No. 131 establishes standards for the manner in which public companies report information about operating segments in annual and interim financial statements. The Company will be required to implement Statement No. 131 for its fiscal year 1999. In June 1998, the FASB issued Statement No. 133, "Accounting for Derivative Instruments and Hedging Activities" which is required to be adopted in years beginning after June 15, 1999. Statement No. 133 provides a comprehensive and consistent standard for the recognition and measurement of derivatives and hedging activities. The Company currently hedges certain foreign exchange transaction exposures. Management has not yet determined what the effect of Statement No. 133 will be on the earnings and financial position of the Company. 19
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PART II. OTHER INFORMATION  ITEM 5. OTHER INFORMATION In accordance with the Company's Bylaws, a shareholder proposing to transact business at the Company's 1999 annual meeting must provide written notice of such proposal, in the manner provided by the Company's Bylaws, not fewer than 60 or more than 90 days prior to the date of such annual meeting (or, if the Company provides less than 60 days notice of such meeting, no later than 10 days after the date of the Company's notice). In addition, if the Company receives notice of a shareholder proposal after November 25, 1998 the persons named as proxies in such proxy statement and proxy will have discretionary authority to vote on such shareholder proposal.  ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits required by Item 601 of Regulation S-K: 2.1 Agreement and Plan of Merger by and among Visio Corporation, Kaspia Systems, Inc., VMS-1, Inc. and the stockholders of Kaspia named therein, dated July 10, 1998 (filed as Exhibit 2.1 to the registrant's Current Report on Form 8-K dated July 10, 1998 and incorporated herein by reference). 4.2 Investor Rights Agreement between Visio Corporation and the investors named therein, dated July 10, 1998 (filed as Exhibit 4.1 to the registrant's Current Report on Form 8-K dated July 10, 1998 and incorporated herein by reference). 27.1 Financial Data Schedule which is submitted electronically to the Securities and Exchange Commission for information purposes only and not filed. (b) Reports on Form 8-K: The Company filed Form 8-K dated July 10, 1988, disclosing the Agreement and Plan of Merger by and among Visio Corporation, Kaspia Systems, Inc., VMS-1, Inc. and the stockholders of Kaspia, dated July 10, 1998. ITEMS 1, 2, 3, AND 4 ARE NOT APPLICABLE AND HAVE BEEN OMITTED. 20
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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. Date: August 17, 1998 VISIO CORPORATION By: /s/ STEVE M. GORDON ------------------------------------------------- Steve M. Gordon Senior Vice President, Finance and Administration; Chief Financial Officer (Principal Financial and Accounting Officer and Duly Authorized Officer) 21
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INDEX TO EXHIBITS EXHIBIT NO. DESCRIPTION PAGE ----------- ----------- ---- 2.1 Agreement and Plan of Merger by and among Visio Corporation, Kaspia Systems, Inc., VMS-1, Inc. and the stockholders of Kaspia named therein, dated July 10, 1998 (filed as Exhibit 2.1 to the registrant's Current Report on Form 8-K dated July 10, 1998 and incorporated herein by reference). N/A 4.2 Investor Rights Agreement between Visio Corporation and the investors named therein, dated July 10, 1998 (filed as Exhibit 4.1 to the registrant's Current Report on Form 8-K dated July 10, 1998 and incorporated herein by reference). N/A 27.1 Financial Data Schedule which is submitted electronically to the Securities and Exchange Commission for information purposes only and not filed. N/A 22

Dates Referenced Herein   and   Documents Incorporated By Reference

Referenced-On Page
This 10-Q Filing   Date First   Last      Other Filings
2/21/97818
5/1/97819
6/27/976
6/30/9721410-Q
9/30/9721910-K405
10/3/976
12/31/97610-Q
1/22/98718
2/10/98818
3/31/9871810-Q
5/5/98818
6/2/98818
For The Period Ended6/30/98119
7/3/986
7/10/989238-K
7/31/981
Filed On / Filed As Of8/17/9822
9/30/9892010-K
11/25/9821
6/15/991020
 
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