8-K/A 1 0001.txt FORM 8-K/A AMENDMENT NO. 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A CURRENT REPORT Amendment No. 1 Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (date of earliest event reported) October 31, 2000 ------------------------------- INTERWOVEN, INC. -------------------------------------------------------------------------------- (Exact name of Registrant as specified in its charter) Delaware 000-27389 77-0523543 ------------------------------ --------------- -------------------- (State or other jurisdiction (Commission (I.R.S. Employer of incorporation) File Number) Identification No.) 1195 West Fremont Avenue Sunnyvale, California 94087 ---------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (408) 774-2000 ----------------------------- 1 ITEM 2: Acquisition or Disposition of Assets On November 13, 2000, Interwoven, Inc. ("Interwoven" or the "Company") filed a Form 8-K to report its acquisitions of Ajuba Solutions, Inc. (formerly known as Scriptics Corporation) ("Ajuba") and Metacode Technologies, Inc. ("Metacode"). Pursuant to Item 7 of Form 8-K, Interwoven indicated that it would file certain financial information no later than the date required by Item 7 of Form 8-K. This Amendment No. 1 to Form 8-K is filed to provide the required financial information. ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS. (a) Financial Statements of Business Acquired. ----------------------------------------- The financial statements of Ajuba and Metacode required by paragraph (a)(4) of Item 7 of Form 8-K are included herein as exhibits 99.2, 99.3 and 99.4. (b) Pro Forma Financial Information. ------------------------------- The pro forma financial statements required by paragraphs (b)(2) and (a)(4) of Item 7 of Form 8-K are included herein. Unaudited pro forma combined balance sheet as of September 30, 2000 Unaudited pro forma combined statement of operations for the nine months ended September 30, 2000 and twelve months ended December 31, 1999 Notes to unaudited pro forma combined financial statements The following unaudited pro forma combined financial statements are presented for illustrative purposes only and are not necessarily indicative of the combined financial position or results of operations for future periods or the financial position or results of operations that actually would have been realized had Interwoven, Ajuba and Metacode been a combined company during the specified periods. The unaudited pro forma combined condensed financial statements, including the related notes, are qualified in their entirety by reference to, and should be read in conjunction with, the historical consolidated financial statements and related notes thereto of Interwoven, included in its Form 10-K and Form 10-Q, filed with the Securities and Exchange Commission on March 30, 2000 and November 15, 2000, respectively, and Ajuba and Metacode, included elsewhere in this Form 8-K/A. The following unaudited pro forma combined financial statements give effect to the merger between Interwoven, Ajuba and Metacode using the purchase method of accounting. The pro forma combined financial statements are based on the respective historical unaudited consolidated financial statements and related notes of Interwoven, Ajuba and Metacode. The pro forma adjustments are preliminary and based on management's estimates of the value of the tangible and intangible assets acquired. In addition, management is continuing to assess its integration plans, which may result in additional costs. The pro forma combined balance sheet and statement of operations assume the merger took place as of September 30, 2000 and January 1, 1999, respectively. The pro forma financial statements combine Interwoven's unaudited consolidated balance sheet as of September 30, 2000 with Ajuba's and Metacode's unaudited balance sheet as of September 30, 2000 and Interwoven's audited statement of operations for the twelve months ended December 31, 1999 and unaudited statement of operations for the nine months ended September 30, 2000 with Ajuba's and Metacode's audited statements of operations for the twelve months ended December 31, 1999 and unaudited statements of operations for the nine months ended September 30, 2000. 2 INTERWOVEN, INC. UNAUDITED PRO FORMA COMBINED BALANCE SHEET (In thousands)
September 30, 2000 (unaudited) ========================================================================= Historical Pro forma ========================================================================= Interwoven Ajuba Metacode Adjustments Combined =========== ========= ========= ============== ======== Assets Current assets: Cash and cash equivalents.......................... $ 53,966 $ 1,620 $ 15 $ (6,166) (a) (d) $ 49,435 Short-term investments............................. 106,510 106,510 Accounts receivable, net .......................... 37,474 361 529 - 38,364 Prepaid expenses................................... 5,272 - 106 - 5,378 Other current assets............................... 1,763 75 - - 1,838 ---------- ---------- --------- --------- --------- Total current assets............................ 204,985 2,056 650 (6,166) 201,525 Investments........................................ 57,021 57,021 Property and equipment, net........................ 9,554 903 308 - 10,765 Intangible assets, net............................. 80,726 - - 183,916 (a) 264,642 Restricted cash.................................... 605 - - - 605 Other assets....................................... 689 199 - - 888 ---------- ---------- --------- --------- --------- Total Assets.................................... $ 353,580 $ 3,158 $ 958 $ 177,750 $ 535,446 ========== ========== ========= ========= ========= Liabilities and Stockholders' Equity Current liabilities: Accounts payable................................... $ 2,828 $ 373 $ 473 $ - $ 3,674 Accrued liabilities................................ 25,629 518 1,046 3,706 (a) 30,899 Deferred revenue, current.......................... 26,828 374 321 - 27,523 Debt, current...................................... - 1,702 4,395 - 6,097 ---------- ---------- --------- --------- --------- Total current liabilities....................... 55,285 2,967 6,235 3,706 68,193 ---------- ---------- --------- --------- --------- Long term liabilities Debt, long-term.................................... - 1,149 - - 1,149 Deferred revenue, long-term........................ - 258 258 ---------- ---------- --------- --------- --------- Total long term liabilities..................... - 1,149 258 - 1,407 ---------- ---------- --------- --------- --------- Mandatorily redeemable convertible preferred stock.. - - 12,857 (12,857) - Stockholders' Equity: Preferred stock..................................... - 10,346 - (10,346) - Common Stock........................................ 24 499 27,445 (27,943) (a) 25 Additional paid-in capital.......................... 343,701 - - 191,350 (a) 535,051 Notes receivable from stockholders.................. (105) (329) (110) - (544) Deferred stock-based compensation................... (7,208) - (12,881) (10,480) (a) (30,569) Accumulated deficit................................. ( 38,117) (11,475) (32,846) 44,321 (a) (38,117) ---------- ---------- --------- --------- --------- Total stockholders' equity...................... 298,295 (959) (18,392) 186,902 465,846 ---------- ---------- --------- --------- --------- Total Liabilities and Stockholders' Equity...... $ 353,580 $ 3,158 $ 958 $ 177,750 $ 535,446 ========== ========== ========= ========= =========
See notes to unaudited pro forma combined financial statements. 3 INTERWOVEN. INC. UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS (In thousands, except per share amounts)
Nine Months Ended September 30, 2000 (unaudited) ----------------------------------------------------------------- Historical Pro forma ----------------------------------- -------------------------- Interwoven Ajuba Metacode Adjustments Combined ----------- ------------ --------- ------------ --------- Revenues: License...................................................... $ 51,347 $ 612 $ 338 $ - $ 52,297 Services..................................................... 26,190 831 255 - 27,276 ----------- ----------- --------- ------------ --------- Total revenues............................................ 77,537 1,443 593 - 79,573 Cost of revenues: License...................................................... 584 132 - - 716 Services..................................................... 24,172 769 415 - 25,356 ----------- ----------- --------- ------------ --------- Total cost of revenues.................................... 24,756 901 415 - 26,072 Gross profit.................................................. 52,781 542 178 - 53,501 Operating expenses: Research and development..................................... 10,487 2,798 1,668 - 14,953 Sales and marketing.......................................... 45,130 1,881 1,109 - 48,120 General and administrative................................... 8,476 2,843 1,147 - 12,466 Amortization of deferred stock-based compensation............ 2,954 - 8,432 4,744 (b) 16,130 Amortization of acquired intangible assets................... 5,109 - - 43,769 (c) 48,878 Writeoff of in-process research & development................ 1,724 - - - 1,724 ----------- ----------- --------- ------------ --------- Total operating expenses.................................. 73,880 7,523 12,356 48,513 142,271 Loss from operations.......................................... (21,099) (6,980) (12,178) (48,513) (88,770) Interest income and other income (expense), net............... 8,945 (213) (1,518) (266) (d) 6,948 ----------- ----------- --------- ------------ --------- Net loss...................................................... $ (12,154) $ (7,193) $(13,696) $ (48,779) $(81,822) ----------- ----------- --------- ------------ --------- Basic and diluted net loss per share.......................... $ (0.13) $ (.88) =========== ========= Shares used in computing basic and diluted net loss per share............................................... 90,256 2,220 (e) 92,476 =========== ============ =========
See notes to unaudited pro forma combined financial statements. 4 INTERWOVEN, INC. UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS (In thousands, except per share amounts)
Twelve Months Ended December 31, 1999 ---------------------------------------------------------------------- Historical Pro forma -------------------------------------- ----------------------------- Interwoven Ajuba Metacode Adjustments Combined ------------ ----------- ----------- ------------- ---------- (unaudited) Revenues: License............................................... $ 10,706 $ 915 $ 29 $ - $ 11,650 Services.............................................. 6,100 1,671 50 - 7,821 ------------ ----------- ----------- ------------ ---------- Total revenues................................... 16,806 2,586 79 - 19,471 Cost of revenues: License............................................... 181 693 - - 874 Services.............................................. 6,576 158 55 - 6,789 ------------ ----------- ----------- ------------ ---------- Total cost of revenues........................... 6,757 851 55 - 7,663 Gross profit........................................... 10,049 1,735 24 - 11,808 Operating expenses: Research and development.............................. 4,199 2,038 985 - 7,222 Sales and marketing................................... 15,582 2,377 559 - 18,518 General and administrative............................ 3,220 1,062 2,358 - 6,640 Amortization of deferred stock-based compensation..... 3,687 - 4,562 12,167 (b) 20,416 Amortization of acquired intangible assets............ 377 - - 53,495 (c) 53,872 Writeoff of in-process research & development......... - - - - - ------------ ----------- ----------- ------------ ---------- Total operating expenses......................... 27,065 5,477 8,464 65,662 106,668 Loss from operations................................... (17,016) (3,742) (8,440) (65,662) (94,860) Interest income and other income (expense), net........ 1,361 89 (46) (354) (d) 1,050 ------------ ----------- ----------- ------------ ---------- Net loss............................................... $ (15,655) $ (3,653) $ (8,486) $ (66,016) $ (93,810) ============ =========== =========== ============ ========== Accretion of mandatorily redeemable convertible preferred stock....................................... (13,227) (13,227) ------------ ---------- Net loss attributable to common stockholders........... $ (28,882) $ (107,037) ============ ========== Basic and diluted net loss per share................... $ (0.24) $ (1.58) ------------ ---------- Shares used in computing basic and diluted net loss per share............................................. 65,336 2,220 (e) 67,556 ------------ ------------ ----------
See notes to unaudited pro forma combined financial statements. 5 INTERWOVEN, INC. NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS On October 31, 2000, Interwoven acquired all of the outstanding capital stock of Ajuba Solutions, Inc. in exchange for approximately 180,000 shares of Interwoven common stock. In addition, Interwoven issued options to purchase a total of approximately 109,000 shares of Interwoven common stock in exchange for all issued and outstanding Ajuba options and agreed to pay Interwoven common stock upon the exercise of such assumed options. Interwoven also loaned approximately $2.0 million to Ajuba in connection with the acquisition. Under purchase accounting, the total purchase price was allocated to Ajuba's assets and liabilities based on their relative fair values with any excess purchase price being allocated to intangibles and goodwill. The fair value of Ajuba's assets and liabilities were estimated by examining expected future cash flows. The amounts and components of the purchase price along with the allocation of the purchase price to assets acquired were as follows (in thousands): Net cash..................................................... $ 650 Common stock................................................. 21,061 Fair value of Ajuba stock options assumed.................... 2,094 Transaction costs............................................ 1,105 -------- Total purchase price....................................... $ 24,910 ======== Book value of tangible assets of Ajuba ...................... $ 2,073 Assumed liabilities ......................................... (4,376) Acquired workforce........................................... 1,480 Goodwill..................................................... 25,733 -------- Net assets acquired........................................ $ 24,910 ======== On November 1, 2000, Interwoven acquired all of the outstanding capital stock of Metacode Technologies, Inc. in exchange for approximately 930,000 shares of Interwoven common stock. In addition, Interwoven issued options to purchase a total of 457,000 shares of Interwoven common stock in exchange for all issued and outstanding Metacode options and agreed to pay Interwoven common stock upon the exercise of such assumed options. Interwoven also loaned approximately $9.0 million to Metacode in connection with the acquisition. Under purchase accounting, the total purchase price was allocated to Metacode's assets and liabilities based on their relative fair values with any excess purchase price being allocated to intangibles and goodwill. The fair value of intangibles and goodwill related to the acquisition were estimated by examining replacement cost and present value of discounted cash flows. The amounts and components of the purchase price along with the allocation of the purchase price to assets acquired were as follows (in thousands): Net cash........................................................ $ 5,250 Common stock.................................................... 114,049 Fair value of Metacode stock options assumed.................... 30,613 Transaction costs............................................... 2,601 -------- Total purchase price........................................ $152,513 ======== Book value of net tangible assets of Metacode................... $ 5,206 Assumed liabilities............................................. (566) Acquired workforce.............................................. 1,700 Completed Technology ........................................... 2,600 Writeoff of In-process Research and Development ................ 100 Goodwill........................................................ 143,473 -------- Net assets acquired............................................. $152,513 ======== 6 INTERWOVEN, INC. NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS As the Company recorded approximately $175.0 million in intangible assets related to the acquisitions, amortization charges of these intangibles is expected to be $9.7 million in the fourth quarter of 2000 and $14.6 million in the first quarter of 2001, respectively. As the Company recorded a deferred compensation liability of $23.3 million related to the assumption of the acquired companies options and the exchange of Interwoven shares for Ajuba shares, amortization expenses related to these items is expected to be $3.0 million in the fourth quarter of 2000 and the first quarter of 2001, respectively. The unaudited pro forma combined balance sheet and unaudited statements of operations give effect to the merger as if it had occurred at the beginning of the period presented. All share and per share amounts have been adjusted to reflect the two for one stock split effected December 29, 2000. The following adjustments have been reflected in the unaudited pro forma combined balance sheet and statements of operations: (a) To record cash paid, common stock and options issued to common and preferred stockholders of the acquired companies, and record applicable purchase accounting entries. (b) To reflect the year to date adjustment related to amortization of deferred stock based compensation. (c) Adjustment to record the amortization of goodwill and intangible assets resulting from the allocation of the Ajuba and Metacode purchase price. The pro forma adjustment assumes goodwill and other intangible assets will be amortized on a straight-line basis over the following estimated lives: Ajuba Metacode ------- ---------- Acquired workforce................................. 2 years 3 years Completed Technology............................... n/a 4 years Goodwill........................................... 3 years 4 years (d) To eliminate interest income earned by Interwoven on cash paid at the date of the merger assuming a 6% interest rate which approximates the Company's actual weighted average rate of return during the periods presented. (e) To reflect the shares issued as consideration for the merger based on the calculated exchange price of $51.125 per share, and $52.34 per share for the Ajuba and Metacode acquisitions, respectively. 7 (c) Exhibits. The following exhibits are filed with this current report on Form 8-K/A Exhibit No. Exhibit Description ----------- ------------------- 2.1* Agreement and Plan of Merger dated October 19, 2000 among Interwoven, Inc., AJ Acquisition Corp. and Ajuba Solutions, Inc. 2.2* Agreement and Plan of Merger dated October 20, 2000 among Interwoven, Inc., Melon Acquisition Corporation and Metacode Technologies, Inc. 23.1 Consent of Arthur Andersen LLP, Independent Public Accountants. 23.2 Consent of PriceWaterhouseCoopers LLP, Independent Accountants. 99.1* Press release dated October 20, 2000. 99.2 Financial statements of Scriptics Corporation for the twelve months ended December 31, 1999 99.3 Unaudited financial statements of Ajuba Solutions, Inc. for the nine months ended September 30, 2000 99.4 Financial statements of Metacode, Inc. __________ *Previously filed 8 SIGNATURE 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 hereunto duly authorized. Dated: January 16, 2001 INTERWOVEN, INC. By: /s/ David M. Allen ------------------------------ David M. Allen Senior Vice President, Chief Financial Officer and Secretary 9