8-K 1 europesale.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 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): April 9, 2003 _____________________ Exact Name of Registrant as Specified in Its Charter: SMTEK INTERNATIONAL, INC. ___________________________________ DELAWARE 1-8101 33-0213512 _____________________________ ____________ _____________ State or Other Jurisdiction of Commission I.R.S. Employer Incorporation or Organization File Number Identification No. Address of Principal Executive Offices: 200 Science Drive Moorpark, CA 93021 _________________________ Registrant's Telephone Number, Including Area Code: (805) 532-2800 _________________________ Former Name or Former Address, if Changed Since Last Report: Not Applicable _________________________ Item 2. Acquisition or Disposition of Assets. On April 9, 2003, SMTEK International, Inc. sold its operations in Ireland to Alina Limited, a company registered under the laws of Northern Ireland. The transaction was consummated by the sale to Alina Limited of all of the capital stock of SMTEK Europe Limited, a wholly-owned subsidiary of DDL Europe Limited and an indirect wholly-owned subsidiary of SMTEK International. In consideration for SMTEK Europe's capital stock, SMTEK International received $1.00 and Alina Limited assumed $5.2 million worth of SMTEK Europe's liabilities. Kieran Leonard, a director of DDL Europe and the Managing Director of SMTEK Europe, is a minority stockholder of Alina Limited. A copy of SMTEK International's press release dated April 15, 2003, announcing the sale, is filed as Exhibit 99.1 hereto and incorporated herein by reference. The foregoing description of the transaction is qualified in its entirety by reference to Exhibits 2.1, 2.2, and 2.3 hereto, which are incorporated herein by reference. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (b) Pro forma financial information: The following pro forma financial information of SMTEK International is included in this Form 8-K on pages F-1 through F-5. - unaudited pro forma condensed consolidated balance sheet of SMTEK International as of December 31, 2002; - the unaudited pro forma condensed consolidated statement of operations of SMTEK International for the year ended June 30, 2002; and - the unaudited pro forma condensed consolidated statement of operations of SMTEK International for the six months ended December 31, 2002. (c) Exhibits The following exhibits are filed with this report on Form 8-K: Exhibit Description _______ ____________ 2.1 Share Sale Agreement, dated March 21, 2003, by and among DDL Europe Limited, Alina Limited and SMTEK International, Inc. 2.2 Disclosure Letter, dated March 21, 2003, from DDL Europe Limited to Alina Limited 2.3 Amendment to Share Sale Agreement, dated April 9, 2003, by and among DDL Europe Limited, Alina Limited and SMTEK International, Inc. 99.1 Press release issued by SMTEK International on April 15, 2003 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. SMTEK INTERNATIONAL, INC. April 24, 2004 /s/ Kirk A. Waldron _________________________________ _________________________________ Date Kirk A. Waldron Senior Vice President Chief Financial Officer EXHIBIT INDEX Exhibit Number Description 2.1 Share Sale Agreement, dated March 21, 2003, by and among DDL Europe Limited, Alina Limited and SMTEK International, Inc. 2.2 Disclosure Letter, dated March 21, 2003, from DDL Europe Limited to Alina Limited 2.3 Amendment to Share Sale Agreement, dated April 9, 2003, by and among DDL Europe Limited, Alina Limited and SMTEK International, Inc. 99.1 Press Release issued by SMTEK International on April 15, 2003 DESCRIPTION OF UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS REFLECTING THE SALE OF SMTEK EUROPE LIMITED BY SMTEK INTERNATIONAL, INC. The following unaudited pro forma condensed consolidated financial statements of SMTEK International have been prepared giving effect to the sale of SMTEK Europe Limited by reflecting this entity as discontinued operations for the pro forma condensed consolidated balance sheet at December 31, 2002 and both the pro forma condensed consolidated statement of operations for the year ended June 30, 2002 and for the six months ended December 31, 2002. F-1 SMTEK INTERNATIONAL, INC. PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET DECEMBER 31, 2002 (Unaudited) (In thousands) Historical Pro forma Pro forma amounts adjustments amounts ------- --------- ------- ASSETS Current assets: Cash and cash equivalents $ 628 $ (159)(A) $ 469 Accounts receivable, net 12,155 (3,534)(A) 8,621 Inventories 10,082 (1,249)(A) 8,833 Prepaid expenses 1,061 (156)(A) 905 Current assets - discontinued operations 5,098 5,098 ------ ------ ------ Total current assets 23,926 - 23,926 Property and equipment, net 8,115 (1,672)(A) 6,443 Deposits and other assets 330 330 Property and equipment - discontinued operations 1,672 1,672 ------ ------ ------ $ 32,371 $ - $ 32,371 ====== ====== ====== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Bank lines of credit payable $ 8,131 $ (2,939)(A) $ 5,192 Current portion of long-term debt 3,235 (1,119)(A) 2,116 Accounts payable 8,343 (1,915)(A) 6,428 Other current liabilities 7,099 (415)(A) 6,684 Current liabilities - discontinued operations 6,388 6,388 ------ ------ ------ Total current liabilities 26,808 - 26,808 ------ ------ ------ Long-term debt 4,618 (86)(A) 4,532 Other long-term liabilities 710 710 Long-term debt - discontinued operations 86 86 ------ ------ ------ Total long-term liabilities 5,328 - 5,328 ------ ------ ------ Stockholders' equity: Common stock and additional paid-in capital 37,051 37,051 Accumulated deficit (36,697) (36,697) Accumulated other comprehensive income (loss) (119) (119) ------ ------ Total stockholders' equity 235 235 ------ ------ ------ $ 32,371 $ - $ 32,371 ====== ====== ====== F-2 SMTEK INTERNATIONAL, INC. PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) YEAR ENDED JUNE 30, 2002 (Unaudited) (In thousands except per share amounts) Historical Pro forma Pro forma results adjustments results ------- --------- ------- Sales $74,222 $(9,664)(A) $64,558 ------ ------ ------ Costs and expenses: Cost of goods sold 68,762 (8,860)(A) 59,902 Administrative and selling 10,716 (1,470)(A) 9,246 Amortization of goodwill 37 37 ------ ------ ------ 79,515 (10,330) 69,185 ------ ------ ------ Operating loss (5,293) (666) (4,627) ------ ------ ------ Non-operating income (expense): Interest expense (1,200) (207)(A) (993) Other income (expense) 284 48 (A) 236 ------ ------ ------ (916) 159 (757) ------ ------ ------ Loss from continuing operations before income taxes (6,209) (825) (5,384) Income tax benefit 225 225 ------ ------ ------ Loss from continuing operations (5,984) (825) (5,159) Loss from discontinued operations, net of taxes 825 (825) ------ ------ ------ Net loss $(5,984) $ - $(5,984) ====== ====== ====== Basic and diluted loss per share: Loss from continuing operations $ (2.62) $ (2.26) Loss from discontinued operations - (0.36) ------- ------- Basic and diluted loss per share $ (2.62) $ (2.62) ======= ======= Shares used in computing basic and diluted loss per share 2,284 2,284 ====== ====== F-3 SMTEK INTERNATIONAL, INC. PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS SIX MONTHS ENDED DECEMBER 31, 2002 (Unaudited) (In thousands except per share amounts) Historical Pro forma Pro forma results adjustments results ------- --------- ------- Sales $ 38,035 $(4,991)(A) $ 33,044 ------ ------ Costs and expenses: Cost of goods sold 35,540 (4,928)(A) 30,612 Administrative and selling 6,526 (500)(A) 6,026 ------ ------ ------ 42,066 (5,428) 36,638 ------ ------ ------ Operating loss (4,031) (437) (3,594) ------ ------ ------ Non-operating income (expense): Interest expense (654) (145)(A) (509) Other income (expense) 30 38 (A) (8) ------ ------ ------ (624) (107) (517) ------ ------ ------ Loss from continuing operations before income taxes (4,655) (544) (4,111) Provision for income taxes (6) (6) ------ ------ ------ Loss from continuing operations (4,661) (544) (4,117) Loss from discontinued operations, net of taxes 544 (544) Loss before change in accounting ------ ------ ------ principle (4,661) - (4,661) Change in accounting principle, net of taxes (420) (420) ------ ------ ------ Net loss $ 5,081) $ - $ (5,081) ====== ====== ====== Basic and diluted loss per share: Loss from continuing operations $ (2.04) $ (1.80) Loss from discontinued operations - (0.24) Change in accounting principle (0.18) (0.18) ======= ======= Basic and diluted loss per share $ (2.22) $ (2.22) ======= ======= Shares used in computing basic and diluted loss per share 2,284 2,284 ====== ====== F-4 SMTEK INTERNATIONAL, INC. NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS (In thousands) (A) To reclassify the financial position of SMTEK Europe Limited and the results of operations of SMTEK Europe Limited for the year ended June 30, 2002 and for the six months ended December 31, 2002 to discontinued operations. F-5