-----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, A9i2G09Y6ADRhM1E5QDHZcKvGO17l7DztmDnACb78KL3oPd9GtUpGC+Upc/KLNYt ow3g8u6HfODIBuZ228yU4g== 0000912057-01-000049.txt : 20010122 0000912057-01-000049.hdr.sgml : 20010122 ACCESSION NUMBER: 0000912057-01-000049 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000930 ITEM INFORMATION: FILED AS OF DATE: 20010102 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NETSCOUT SYSTEMS INC CENTRAL INDEX KEY: 0001078075 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 042837575 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-26251 FILM NUMBER: 1500575 BUSINESS ADDRESS: STREET 1: 4 TECHNOLOGY PARK DR CITY: WESTFORD STATE: MA ZIP: 01886 BUSINESS PHONE: 9786144000 MAIL ADDRESS: STREET 1: 4 TECHNOLOGY PARK DRIVE CITY: WESTFORD STATE: MA ZIP: 01886 8-K 1 a2034375z8-k.txt 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ---------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report ---------------------------------- (Date of earliest event reported): July 7, 2000 NETSCOUT SYSTEMS, INC. (Exact Name of Registrant as Specified in Charter) Delaware 0000-26251 04-2837575 - ----------------------------------- ------------------- ------------------------ (State or Other Jurisdiction of (Commission (IRS Employer Incorporation) File Number) Identification No.) 4 Technology Park Drive Westford, Massachusetts 01886 - ---------------------------------------- ------------------------ (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (978) 614-4000 Item 5. OTHER EVENTS. ------------ NETSCOUT SYSTEMS, INC. UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 (IN THOUSANDS, EXCEPT PER SHARE DATA)
PRO FORMA PRO FORMA NETSCOUT NEXTPOINT ADJUSTMENTS COMBINED ---------------------------------------------------------------------- Revenue: Product $38,551 $ - $ - $38,551 Service 8,404 61 - 8,465 License and royalty 7,033 963 - 7,996 ------- ------- ------- ------- Total revenue 53,988 1,024 - 55,012 ------- ------- ------- ------- Cost of revenue: Product 13,357 - - 13,357 Service 1,452 30 - 1,482 License - 16 - 16 ------- ------- ------- ------- Total cost of revenue 14,809 46 - 14,855 ------- ------- ------- ------- Gross margin 39,179 978 - 40,157 ------- ------- ------- ------- Operating expenses: Research and development 6,911 828 552 E 8,291 Sales and marketing 18,976 1,899 - 20,875 General and administrative 3,943 1,443 - 5,386 Stock-based compensation - 121 (121)D - Amortization of intangible assets 2,666 - 2,568 A 5,234 In-process research and development 268 - (268)G - ------- ------- ------- ------- Total operating expenses 32,764 4,291 2,731 39,786 ------- ------- ------- ------- Income (loss) from operations 6,415 (3,313) (2,731) 371 Interest income (expense), net 2,142 (1,899) (229)B 14 ------- ------- ------- ------- Income (loss) before provision for income taxes 8,557 (5,212) (2,960) 385 Provision for income taxes 5,014 - (4,619) C 395 ------- ------- ------- ------- Net income (loss) $ 3,543 $(5,212) $ 1,659 $ (10) ======= ======= ======= ======= Basic net income (loss) per share $ 0.13 $ (0.00) Diluted net income (loss) per share $ 0.12 $ (0.00) Shares used in computing: Basic net income (loss) per share 27,561 1,178 F 28,739 Diluted net income (loss) per share 28,955 28,739
See accompanying notes to the unaudited pro forma combined financial information. NOTES TO THE UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION 1. PRO FORMA BASIS OF PRESENTATION AND ADJUSTMENTS The foregoing unaudited pro forma combined financial information gives effect to the acquisition by NetScout Systems, Inc. ("NetScout") of NextPoint Networks, Inc. ("NextPoint") in a transaction accounted for using the purchase method. The unaudited pro forma combined statement of operations is based on the individual statements of operations of NetScout for the six months ended September 30, 2000 and NextPoint for the period from April 1, 2000 to July 7, 2000 as if the acquisition occurred on April 1, 2000. The results of operations of NextPoint subsequent to July 7, 2000 have been included in NetScout's statement of operations for the six months ended September 30, 2000. The unaudited pro forma combined statement of operations for the six months ended September 30, 2000 excludes $1.1 million of revenue and $1.8 million of net loss related to NextPoint for the three months ended March 31, 2000. On July 7, 2000, NetScout acquired all of the outstanding common and preferred stock of NextPoint in exchange for 1,831,518 shares of NetScout common stock and $19.6 million in cash. NetScout also issued options and warrants exercisable for 298,647 shares of NetScout common stock in exchange for all outstanding options and warrants of NextPoint common stock. In addition 267,602 shares of NetScout common stock have been reserved and will be issued to two founding shareholders and employees of NextPoint in accordance with the terms of the acquisition. The initial value of the acquisition was $53.1 million based on the fair value of the consideration paid plus direct acquisition costs. 2. PRO FORMA ADJUSTMENTS TO PRO FORMA COMBINED CONSOLIDATED FINANCIAL INFORMATION A. The initial purchase price of $53.1 million is based on the consideration paid to NextPoint stockholders including common stock, options, warrants and cash plus acquisition related expenses. The purchase price was allocated as follows (in thousands): Tangible net assets $ 3,709 Intangible assets acquired: Goodwill 45,142 Completed technology 2,166 Customer base 1,100 Assembled workforce 700 In-process research and development 268 ------- Total purchase price allocation $53,085 ======= Based on an estimated useful life of three to five years for such intangible assets, the unaudited pro forma combined financial information includes an adjustment of $2.6 million for the six months ended September 30, 2000 for amortization expense. B. Decrease in interest income resulting from cash payment of $19.6 million and the repayment of notes payable for $3.3 million. C. Decrease in provision for income taxes as a result of the various pro forma adjustments. D. Elimination of stock-based compensation expense related to options issued by NextPoint prior to the acquisition. E. Increase in research and development expense for the amortization of deferred compensation expense on unvested options issued by NetScout in exchange for unvested NextPoint options and for the amortization of deferred compensation on common stock issued to two founding shareholders and employees on NextPoint during the unaudited pro forma period presented. F. Basic and diluted net loss per share assumes that the 1,831,518 shares of NetScout's common stock issued in the acquisition were outstanding for the entire period and assumes 61,548 shares of NetScout's common stock were issued to two founding shareholders and employees of NextPoint as they remained continuously employed by NetScout during the unaudited pro forma combined statements of operations for the six months ended September 30, 2000. All potential common stock has been excluded from the calculation of pro forma net loss per share as their inclusion would be anti-dilutive. G. To eliminate the one-time write-off of in-process research and development as a result of the acquisition. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. NETSCOUT SYSTEMS, INC. January 2, 2001 By: /s/ Anil K. Singhal ---------------------------------------- Anil K. Singhal Chairman and Chief Executive Officer -----END PRIVACY-ENHANCED MESSAGE-----