-----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, VQbQW9oZ4E9zmL+PldjUaGabQz1rrK/S53T/yKTZM9fyKMUrtK2EDSk6BVXR+Y2m 4K2VO0wUUBzOEyRUct7DMA== 0000046709-98-000026.txt : 19980720 0000046709-98-000026.hdr.sgml : 19980720 ACCESSION NUMBER: 0000046709-98-000026 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980507 ITEM INFORMATION: FILED AS OF DATE: 19980714 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: HELIX TECHNOLOGY CORP CENTRAL INDEX KEY: 0000046709 STANDARD INDUSTRIAL CLASSIFICATION: SPECIAL INDUSTRY MACHINERY, NEC [3559] IRS NUMBER: 042423640 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 000-06866 FILM NUMBER: 98665887 BUSINESS ADDRESS: STREET 1: NINE HAMPSHIRE STREET STREET 2: NINE HAMPSHIRE ST CITY: MANSFIELD STATE: MA ZIP: 02048 BUSINESS PHONE: 5083375111 MAIL ADDRESS: STREET 1: NINE HAMPSHIRE STREET CITY: MANSFIELD STATE: MA ZIP: 02048 FORMER COMPANY: FORMER CONFORMED NAME: CRYOGENIC TECHNOLOGY INC DATE OF NAME CHANGE: 19760707 8-K/A 1 AMENDMENT 1 TO FORM 8-K/A SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): May 7, 1998 HELIX TECHNOLOGY CORPORATION (Exact name of registrant as specified in its charter) DELAWARE (State or other jurisdiction of incorporation) 0-6866 04-2423640 (Commission File No.) (I.R.S. Employer Identification No.) Mansfield Corporate Center Nine Hampshire Street Mansfield, Massachusetts 02048-9171 (Address of Principal Executive Offices) (Zip Code) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (508) 337-5111 N.A. (FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT) INFORMATION TO BE INCLUDED IN THE REPORT THIS REPORT ON FORM 8-K/A AMENDS THE REGISTRANT'S REPORT ON FORM 8-K DATED MAY 7, 1998, WHICH WAS FILED ON MAY 15, 1998 TO INCLUDE THE FINANCIAL STATEMENTS AND PRO FORMA FINANCIAL INFORMATION REQUIRED BY ITEM 7 OF FORM 8-K. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED: Independent Auditors' Report Balance Sheets of Granville-Phillips Company as of December 31, 1997 and 1996, and March 31, 1998 Statements of Income of Granville-Phillips Company for the Years Ended December 31, 1997, 1996 and 1995 and the Three Months Ended March 31, 1998 and 1997 Statements of Shareholders' Investment of Granville-Phillips Company for the Years Ended December 31, 1997, 1996 and 1995 and the Three Months Ended March 31, 1998 Statements of Cash Flows of Granville-Phillips Company for the Years Ended December 31, 1997, 1996 and 1995 and the Three Months Ended March 31, 1998 and 1997 Notes to Financial Statements of Granville-Phillips Company (b) PRO FORMA FINANCIAL INFORMATION Unaudited Pro Forma Combined Balance Sheet as of March 27, 1998 Unaudited Pro Forma Combined Statements of Operations for the Years Ended December 31, 1997, 1996 and 1995 and the Three Months Ended March, 1998 and 1997 Unaudited Notes to Pro Forma Financial Statements (c) EXHIBITS Page Number(s) or Incorporation by Description Reference to 2.1 Agreement and Plan of Merger dated Exhibit 2.1 to the as of April 16, 1998 among Helix Company's Form 8-K Technology Corporation, Helix filed May 15, 1998. Acquisition Corporation, Granville- Phillips Company and certain principal stockholders of Granville-Phillips Company. 2.2 Registration Rights Agreement dated Exhibit 2.2 to the May 7, 1998. Company's Form 8-K filed May 15, 1998. Exhibit 2.3 to the 2.3 Escrow Agreement dated May 7, 1998. Company's Form 8-K filed May 15, 1998. 23 Consent of Arthur Andersen LLP REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Shareholders and Board of Directors of Granville-Phillips Company: We have audited the accompanying balance sheets of GRANVILLE-PHILLIPS COMPANY (a Washington S corporation) as of December 31, 1997 and 1996, and the related statements of income, shareholders' investment and cash flows for each of the years in the three-year period ended December 31, 1997. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Granville-Phillips Company as of December 31, 1997 and 1996, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 1997, in conformity with generally accepted accounting principles. /s/Arthur Andersen LLP Denver, Colorado, February 18, 1998 (except for the matter discussed in Note 10, as to which the date is May 7, 1998). GRANVILLE-PHILLIPS COMPANY BALANCE SHEETS AS OF DECEMBER 31, 1997 AND 1996 AND MARCH 31, 1998 - ------------------------------------------------------------------------------------------------------------------------
(Unaudited) December 31, March 31, (in thousands except per share data) 1997 1996 1998 - ------------------------------------------------------------------------------------------------------------------------ ASSETS Current Assets: Cash and cash equivalents $ 1,357 $ 858 $ 1,354 Short-term cash investments, at cost which approximates market 3,675 2,700 3,818 Accounts receivable, less allowance for doubtful accounts of $90 2,814 1,789 2,302 Inventory, net 4,084 3,485 4,441 Prepaid expenses and other 42 60 124 - ------------------------------------------------------------------------------------------------------------------------ Total Current Assets 11,972 8,892 12,039 - ------------------------------------------------------------------------------------------------------------------------ Property, plant and equipment, at cost 7,158 6,428 7,433 Less: accumulated depreciation (4,739) (4,202) (4,869) - ------------------------------------------------------------------------------------------------------------------------ Net property, plant and equipment 2,419 2,226 2,564 Patents, net of accumulated amortization 162 128 104 ======================================================================================================================== TOTAL ASSETS $14,553 $11,246 $14,707 ======================================================================================================================== LIABILITIES AND SHAREHOLDERS' INVESTMENT Current Liabilities: Accounts payable $ 341 $ 189 $ 327 Dividends payable 153 134 - Accrued liabilities 1,102 1,038 1,957 Income taxes payable (Note 3) 52 46 226 - ------------------------------------------------------------------------------------------------------------------------ Total Current Liabilities 1,648 1,407 2,510 - ------------------------------------------------------------------------------------------------------------------------ Noncurrent income taxes payable (Note 3) 39 47 39 Noncurrent liability (Note 4) 217 146 - Commitments and contingencies (Note 5) - - - Shareholders' investment (Notes 6, 7 and 8): Common stock, authorized 1,000,000 shares; 110,689 at December 31, 1997 and March 31, 1998, and 107,289 at December 31, 1996 Series A - voting, no par value shares issued and outstanding 3,506 2,940 7,753 664,134 Series B - non-voting, no par value shares issued and outstanding at December 31, 1997 and March 31, 1998 664 - 664 Retained earnings 9,432 7,591 8,356 Unamortized amount for stock issued under stock incentive plans (953) (885) (4,615) - ------------------------------------------------------------------------------------------------------------------------ Total Shareholders' Investment 12,649 9,646 12,158 ======================================================================================================================== TOTAL LIABILITIES AND SHAREHOLDERS' INVESTMENT $14,553 $11,246 $14,707 ======================================================================================================================== The accompanying notes are an integral part of these financial statements.
GRANVILLE-PHILLIPS COMPANY STATEMENTS OF INCOME FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995 AND THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997 (Unaudited) - ---------------------------------------------------------------------------------------------------------------
(Unaudited) For the years ended For the three months ended December 31, March 31, (in thousands) 1997 1996 1995 1998 1997 - --------------------------------------------------------------------------------------------------------------- Net Sales $25,558 $23,282 $21,703 $ 5,621 $5,386 - --------------------------------------------------------------------------------------------------------------- Costs and expenses: Cost of sales 11,588 10,811 9,941 2,842 2,526 Research and development 2,642 2,545 1,946 634 583 Selling, general and administrative 7,228 6,851 6,098 3,114 1,544 - --------------------------------------------------------------------------------------------------------------- 21,458 20,207 17,985 6,590 4,653 - --------------------------------------------------------------------------------------------------------------- Operating income (loss) 4,100 3,075 3,718 (969) 733 Interest income 209 169 90 38 22 Other, net 18 38 9 - - - --------------------------------------------------------------------------------------------------------------- Income (loss) before taxes 4,327 3,282 3,817 (931) 755 Income taxes - (Note 3) -- State tax provision (98) (113) (108) (145) (25) - --------------------------------------------------------------------------------------------------------------- Net income (loss) $ 4,229 $ 3,169 $ 3,709 $(1,076) $ 730 =============================================================================================================== Pro forma information (unaudited): Income (loss) before taxes $ 4,327 $ 3,282 $ 3,817 $ (931) $ 755 Income tax provision (1,719) (1,300) (1,480) 151 (306) - --------------------------------------------------------------------------------------------------------------- Net income (loss) $ 2,608 $ 1,982 $ 2,337 $ (780) $ 449 =============================================================================================================== The accompanying notes are an integral part of these financial statements.
GRANVILLE-PHILLIPS COMPANY STATEMENTS OF SHAREHOLDERS' INVESTMENT FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995 AND THE THREE MONTH PERIOD ENDED MARCH 31, 1998 (in thousands)
Unamortized Amount for Stock Issued Voting Non-Voting Under Stock Common Stock Common Stock Incentive Retained Shares Amount Shares Amount Plans Earnings BALANCES, December 31, 1994 103 $1,626 - $ - $ (260) $ 4,967 Net income - - - - - 3,709 Stock incentive plans (Note 6) - Common stock issued 3 296 - - (296) - Increase in estimated value of shares - 169 - - (169) - Amortization - - - - 217 - Stock repurchase (3) - - - - (280) Dividends - cash - - - - - (1,244) --- ------ --- ---- ------- ------- BALANCES, December 31, 1995 103 2,091 - - (508) 7,152 Net income - - - - - 3,169 Stock incentive plans (Note 6) - Common stock issued 3 432 - - (432) - Increase in estimated value of shares - 297 - - (297) - Amortization - - - - 352 - Common stock issued for services 1 120 - - - - Dividends - cash - - - - - (2,730) --- ------ --- ---- ------- ------- BALANCES, December 31, 1996 107 2,940 - - (885) 7,591 Net income - - - - - 4,229 Stock incentive plans (Note 6) - Common stock issued 4 442 - - (442) - Increase in estimated value of shares - 124 - - (124) - Amortization - - - - 498 - Dividends - Cash - - - - - (1,724) Stock - - 664 664 - (664) --- ------ --- ---- ------- ------- BALANCES, December 31, 1997 111 3,506 664 664 (953) 9,432 Net loss (unaudited) - - - - - (1,076) Stock incentive plans (Note 6) - (unaudited) Increase in estimated value of shares - 4,247 - - (4,247) - Amortization - - - - 585 - --- ------ --- ---- ------- ------- BALANCES, March 31, 1998 (unaudited) 111 $7,753 664 $664 $(4,615) $ 8,356 === ====== === ==== ======= ======= The accompanying notes are an integral part of these financial statements.
GRANVILLE-PHILLIPS COMPANY STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995 - ----------------------------------------------------------------------------------------------------------------
(in thousands) 1997 1996 1995 - ---------------------------------------------------------------------------------------------------------------- Cash flows from operating activities: Net income $ 4,229 $ 3,169 $ 3,709 Adjustments to reconcile net income to net cash provided (used) by operating activities: Depreciation and amortization 547 547 520 Gain on sale of assets - (1) (1) Amortization of stock incentive plans 498 352 217 Stock issued for services - 120 - Other 71 83 75 Net change in operating assets and liabilities (A) (1,392) (241) (874) - ---------------------------------------------------------------------------------------------------------------- Net cash provided by operating activities 3,953 4,029 3,646 - ---------------------------------------------------------------------------------------------------------------- Cash flows from investing activities: Capital expenditures (730) (671) (539) Purchase of short-term cash investments (4,445) (4,277) (3,676) Proceeds from sale of short-term cash investments 3,470 3,704 2,205 Proceeds from sale of assets - 1 2 Purchase of patents (44) (31) (18) - ---------------------------------------------------------------------------------------------------------------- Net cash used by investing activities (1,749) (1,274) (2,026) - ---------------------------------------------------------------------------------------------------------------- Cash flows from financing activities: Cash paid for repurchase of stock - - (280) Dividends paid (1,705) (2,713) (1,234) - ---------------------------------------------------------------------------------------------------------------- Net cash used by financing activities (1,705) (2,713) (1,514) - ---------------------------------------------------------------------------------------------------------------- Increase (decrease) in cash and cash equivalents 499 42 106 Cash and cash equivalents, at the beginning of the period 858 816 710 ================================================================================================================ Cash and cash equivalents, at the end of the period $ 1,357 $ 858 $ 816 ================================================================================================================ (A) Change in operating assets and liabilities: (Increase)/decrease in accounts receivable $(1,025) $ 665 $ (380) (Increase)/decrease in inventories, net (599) (699) (672) (Increase)/decrease in prepaid expenses and other 18 (7) 4 Increase/(decrease) in accounts payable and accrued liabilities 216 (149) 148 Increase/(decrease) in income taxes payable (2) (51) 26 ================================================================================================================ Net change in operating assets and liabilities $(1,392) $ (241) $ (874) ================================================================================================================ Supplemental disclosure of non-cash financing activities: Common stock issued under stock incentive plans $ 442 $ 432 $ 296 ================================================================================================================ Stock dividend declared $ 664 $ - $ - ================================================================================================================ The accompanying notes are an integral part of these financial statements.
GRANVILLE-PHILLIPS COMPANY STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997 (Unaudited) - ---------------------------------------------------------------------------------------------------------------
(in thousands) 1998 1997 - --------------------------------------------------------------------------------------------------------------- Cash flows from operating activities: Net income (loss) $(1,076) $ 730 Adjustments to reconcile net income to net cash provided (used) by operating activities: Depreciation and amortization 209 70 Gain on sale of assets - 136 Amortization of stock incentive plans 585 - Net change in operating assets and liabilities (A) 871 (473) - --------------------------------------------------------------------------------------------------------------- Net cash provided by operating activities 589 463 - --------------------------------------------------------------------------------------------------------------- Cash flows from investing activities: Capital expenditures (275) (134) Purchase of short-term cash investments (1,775) (770) Proceeds from sale of short-term cash investments 1,632 1,018 Purchase of patents (21) - - --------------------------------------------------------------------------------------------------------------- Net cash used by investing activities (439) 114 - --------------------------------------------------------------------------------------------------------------- Cash flows from financing activities: Dividends paid (153) (134) - --------------------------------------------------------------------------------------------------------------- Net cash used by financing activities (153) (134) - --------------------------------------------------------------------------------------------------------------- Increase (decrease) in cash and cash equivalents (3) 443 Cash and cash equivalents, at the beginning of the period 1,357 858 =============================================================================================================== Cash and cash equivalents, at the end of the period $ 1,354 $1,301 =============================================================================================================== (A) Change in operating assets and liabilities: (Increase)/decrease in accounts receivable $ 512 $ (690) (Increase)/decrease in inventories, net (357) 211 (Increase)/decrease in prepaid expenses and other (82) 8 Increase/(decrease) in accounts payable and accrued liabilities 624 (2) Increase/(decrease) in income taxes payable 174 - =============================================================================================================== Net change in operating assets and liabilities $ 871 $ (473) =============================================================================================================== The accompanying notes are an integral part of these financial statements.
GRANVILLE-PHILLIPS COMPANY NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1997, 1996 AND 1995 AND MARCH 31, 1998 (Unaudited) (Monetary Amounts Stated in Thousands Except Per Share Amounts) 1. ORGANIZATION Granville-Phillips Company (the "Company") designs, manufactures and sells vacuum pressure measurement and flow control instrumentation to foreign and domestic distributors and end-users. Interim Financial Information The interim financial statements have been prepared by the Company pursuant to the interim reporting rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and disclosures normally accompanying financial statements prepared in accordance with generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the interim financial statements include all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the information set forth therein. Results for the interim period are not necessarily indicative of the results to be expected for the entire year. 2. SIGNIFICANT ACCOUNTING POLICIES Short-Term Investments The Company has short-term investments classified as "held-to-maturity" as defined by Statement of Financial Accounting Standards No. 115, "Accounting for Certain Investments in Debt and Equity Securities." At December 31, 1997 and 1996, and March 31, 1998, these investments are carried at a cost of approximately $3,675, and $2,700 and $3,818, respectively, which approximates market value, and consists of treasury bills which have an original maturity of longer than three months. Unrealized gains for these securities for the years ended December 31, 1997, 1996 and 1995, and quarter ended March 31, 1998 were immaterial. Inventory Inventory is valued at the lower of cost (last-in, first-out ("LIFO")) or market. The inventory balances were as follows: (Unaudited) December 31, March 31, 1997 1996 1998 Raw materials and work in process (FIFO) $3,793 $3,335 $4,046 Finished goods (FIFO) 509 348 615 ------ ------ ------ 4,302 3,683 4,661 Less-LIFO reserve (218) (198) (220) ------ ------ ------ $4,084 $3,485 $4,441 ====== ====== ====== GRANVILLE-PHILLIPS COMPANY NOTES TO FINANCIAL STATEMENTS (Continued) 2. SIGNIFICANT ACCOUNTING POLICIES (Continued) Property, Plant and Equipment Property, plant and equipment are recorded at cost. Additions, improvements and betterments are capitalized when incurred. Maintenance and repairs are charged to operations as the costs are incurred. The Company computes depreciation using the straight-line method over the following estimated useful lives beginning when the asset is placed in service: Building and improvements 10-50 years Equipment 3-15 years Furniture, fixtures and computer equipment 5-15 years Depreciation expense for the years ended December 31, 1997, 1996 and 1995 was approximately $538, $539 and $513, respectively. Accrued Liabilities Accrued liabilities consist of the following as of December 31, 1997 and 1996 and March 31, 1998. (Unaudited) December 31, March 31, 1997 1996 1998 Accrued salaries and benefits $ 649 $ 605 $1,003 Accrued vacation 291 281 300 Accrued property taxes 85 83 65 Other accrued expenses 77 69 589 --------------------------------------- $1,102 $1,038 $1,957 ======================================= GRANVILLE-PHILLIPS COMPANY NOTES TO FINANCIAL STATEMENTS (Continued) 2. SIGNIFICANT ACCOUNTING POLICIES (Continued) Patents Patent costs consist primarily of legal and filing fees associated with the patent registration. These costs are amortized over the expected useful life of the issued patent, up to 17 years. The Company's current patents expire between 2004 and 2016; however, expiration of any single patent is not expected to have a material adverse effect on the Company or its operations. Revenue Recognition The company recognizes revenue when title and risk of ownership passes to the customer which generally, as to shipments with FOB destination terms, is upon receipt by the customer and, for shipments with FOB shipping point terms, is upon departure from the Company's dock. Research and Development Expenditures Expenditures for research and development are expensed when incurred. The Company incurred approximately $2,642, $2,545 and $1,946 of research and development costs during the years ended December 31, 1997, 1996, and 1995, respectively. For the three-month periods ended March 31, 1998 and 1997, the Company incurred approximately $634 and $583, respectively, of research and development costs. Statements of Cash Flows For purposes of the statements of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Income Taxes The Company has elected to be treated as an S corporation for income tax purposes. The federal and state income taxes related to S corporation income are the responsibility of the individual shareholders of the Company. In certain states, the Company has not elected S corporation status for tax reporting purposes and, therefore, in those states the state income taxes are the responsibility of the Company (see Note 3). The unaudited pro forma income tax provision and related information presented on the statements of income reflects a provision for taxes as if the company had been a tax paying corporation for all periods presented. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. GRANVILLE-PHILLIPS COMPANY NOTES TO FINANCIAL STATEMENTS (Continued) 2. SIGNIFICANT ACCOUNTING POLICIES (Continued) Evaluation of Long-Lived Assets In accordance with Statement of Financial Accounting Standards (SFAS) No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of," the Company evaluates the potential impairment of long-lived assets based upon projections of undiscounted cash flows whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. If deemed impaired, the assets are written down to their fair value. Management believes there has been no impairment of the Company's long-lived assets at December 31, 1997. Reclassifications Certain prior period balances have been reclassified to conform with current period presentation. New Accounting Pronouncements The Financial Accounting Standards Board (FASB) recently issued SFAS Nos. 130 "Reporting Comprehensive Income" (SFAS No. 130) and 131, "Disclosures about Segments of an Enterprise and Related Information" (SFAS No. 131). SFAS No. 130 requires the presentation of "Other Comprehensive Income", as defined, and is effective for fiscal years beginning after December 15, 1997. The Company has no other comprehensive income. SFAS No. 131 establishes standards for the way public business enterprises report information about operating segments and the related disclosures about products and services, geographic areas and major customers. Adoption of SFAS No. 131 will not have a material effect on the corporation's presentation of operating segments and related disclosures. SFAS 131 is effective for financial statements issued for fiscal years beginning after December 15, 1997. 3. INCOME TAXES As a result of the Company's status as an S corporation, federal and state income taxes related to the S corporation income are the responsibility of the individual shareholders of the Company. The total amount of the Company's tax basis in its assets exceeded the amount for book purposes by approximately $100 at December 31, 1997, and certain liabilities for book purposes exceeded the amounts recognized for tax purposes by approximately $500 at December 31, 1997. As a result of the change to an S corporation effective April 1, 1994, the previously deferred income taxes of $79 on certain items, remain a liability of the Company and are payable ratably over a ten-year period. During each of the years ended December 31, 1997, 1996 and 1995, the Company made payments related to this liability of approximately $8. The Company has a remaining income tax liability of approximately $47 related to these taxes of which $8 is reflected as a current liability in the accompanying December 31, 1997 balance sheet. The provision for income taxes consists of state taxes currently payable of approximately $98, $113 and $108 for the years ended December 31, 1997, 1996 and 1995, respectively. The Company had made estimated state income tax payments of approximately $59, $81 and $60 prior to December 31, 1997, 1996 and 1995, respectively. GRANVILLE-PHILLIPS COMPANY NOTES TO FINANCIAL STATEMENTS (Continued) 4. BENEFIT PLANS Retirement Savings Plan The Company has a defined contribution plan under Section 401(K) of the Internal Revenue Code. The plan covers full-time employees based on a minimum age of 21 and a minimum service of one year. The Company may make discretionary contributions to the plan, but is not required to match any employee contributions. The Company made discretionary contributions of $355, $340 and $300 during the years ended December 31, 1997, 1996 and 1995, respectively. Amounts withheld from employees but not paid to the plan at December 31, 1997 and 1996 were approximately $43 and $40, respectively, and are included in accrued liabilities in the accompanying balance sheets. Performance Share Plans The Company has established several performance share plans for certain key employees. The benefits from the plans, if any, will be paid to the employees in cash and will be based on the current market value, as defined, of the employee's vested shares on the date of payment. The benefits payable to the employees vest pursuant to a formula based on operating results through December 31, 2001. In the event an employee leaves the Company for any reason, other than a leave of absence approved by the Company, prior to vesting, their performance share benefit shall be canceled and forfeited without payment by the Company. The benefits of the plans will be paid to the employees on March 31, 2004, December 31, 2005, December 31, 2006 and December 31, 2007, or earlier upon certain triggering events defined in the agreement. In the event that a majority of the Company's voting stock or assets are sold (see Note 10), the employee's performance share benefit will fully vest and the employee will be paid the value of the shares at the time of sale. The Company, using current market value of the shares, recorded an expense of approximately $71, $83 and $36 for the years ended December 31, 1997, 1996 and 1995, respectively, and a liability of $217 and $146 as of December 31, 1997 and 1996, respectively, related to the plans. For the three-month periods ended March 31, 1998 and 1997, the Company recorded an expense of $748 and $19, respectively, related to the plans. The related liability as of March 31, 1998 and 1997 was $965 and $150, respectively. GRANVILLE-PHILLIPS COMPANY NOTES TO FINANCIAL STATEMENTS (Continued) 5. COMMITMENTS AND CONTINGENCIES The Company leases manufacturing space and equipment under noncancelable operating leases. The approximate future minimum payments under these operating leases, which expire on various dates through December 31, 2000, are as follows: Year ending December 31 1998 $243 1999 208 2000 100 2001 - Thereafter - ---- $551 Total rent expense related to these leases of approximately $181, $141 and $107 in 1997, 1996 and 1995, respectively, is included in operating expenses. 6. STOCK INCENTIVE PLANS The Company has issued shares of common stock to certain key employees under various stock incentive plans. The shares vest pursuant to a formula based on operating results. In addition, the Company has the option to acquire, at no cost, all of the shares held by these employees if they terminate prior to the date the shares vest. During the years ended December 31, 1997, 1996 and 1995, no shares of stock previously granted were forfeited. Total compensation for the vesting period of the plan is recorded in the financial statements in the year the plan is adopted by a credit to common stock. Estimated compensation is changed annually based on the change in the estimated value of the Company's common stock. The amount expensed each year is the pro rata portion of total compensation for the remaining vesting period based on performance achieved to date. The amount expensed for 1997, 1996 and 1995, respectively, was approximately $498, $352 and $217. For the three-month periods ended March 31, 1998 and 1997, the amount expensed was approximately $585 and $49, respectively. The unamortized compensation amount is reflected as an offset to shareholders' investment. The Company's accounting, as described above, for its stock based incentive compensation plans is consistent with the methods prescribed by APB Opinion No. 25, "Accounting for Stock Issued to Employees." GRANVILLE-PHILLIPS COMPANY NOTES TO FINANCIAL STATEMENTS (Continued) 6. STOCK INCENTIVE PLANS (Continued) At December 31, 1997, there were 13,700 shares issued and outstanding that vest through December 31, 2001. At issue date, the estimated value of these shares was approximately $1,384. At December 31, 1997 and at March 31, 1998, the estimated value was approximately $1,781 and $6,028, respectively. For each incentive plan transaction, the Board of Directors ratifies a per share value according to an independent appraisal. The estimated fair values at issue date are computed by multiplying the specific year's per share value times the number of shares issued under each plan. Number of Shares Issue Date Estimated Fair Value Increases during - 1995 3,400 $296 1996 3,600 $432 1997 3,400 $442 7. COMMON STOCK During 1997, the Company's shareholders approved an increase in the number of authorized common shares to 1,000,000 and the Board of Directors approved the issuance of 664,134 shares of Series B, non-voting common stock as a stock dividend to all existing shareholders. The shareholders also approved a transfer of $1 per share for the stock dividend from retained earnings to capital stock. 8. RETIREMENT OF STOCK The state of Washington, under whose laws the Company is incorporated, requires the retirement of stock to be charged to retained earnings as a restriction on dividends. 9. MAJOR CUSTOMER Revenue in 1997, 1996 and 1995, from Applied Materials, a leading manufacturer of semiconductor capital equipment, accounted for approximately 32%, 29% and 29% of Company revenues, respectively, and 21% of the total trade accounts receivable at December 31, 1997 and 1996. 10. SUBSEQUENT EVENT In a transaction which closed on May 7, 1998, all of the outstanding stock of the Company was exchanged for shares in Helix Technology Corporation. HELIX TECHNOLOGY CORPORATION AND GRANVILLE-PHILLIPS COMPANY UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION BASIS OF PRESENTATION The following unaudited pro forma combined financial statements give effect to the merger of Helix Technology Corporation ("Helix" or "Company") and Granville-Phillips Company ("GPC) under the pooling-of-interests method of accounting. The unaudited pro forma combined financial statements are based on the historical consolidated financial statements and notes thereto (as applicable) of Helix and the historical financial statements and notes thereto (as applicable) of GPC, which are included elsewhere herein. The unaudited pro forma combined balance sheet assumes that the merger took place on March 27, 1998, and combines Helix's March 27, 1998, consolidated balance sheet with GPC's March 31, 1998, balance sheet. The unaudited pro forma combined statements of operations assume that the merger took place on January 1, 1995, and combines Helix's consolidated statements of operations with GPC's statements of operations for the fiscal years ended December 31, 1997, 1996 and 1995 and the three months ended March 27, 1998 and March 28, 1997 for Helix and March 31, 1998 and 1997 for GPC. The unaudited pro forma financial information does not purport to represent what the Company's financial position or results of operations would actually have been had the transactions in fact occurred on the dates indicated above, nor to project the Company's financial position or results of operations for any future date or period. The pro forma financial information should be read in conjunction with the accompanying notes and the consolidated financial statements included in the Company's 1997 Annual Report on Form 10-K/A and Quarterly Report on Form 10-Q for the quarter ended March 27, 1998. HELIX TECHNOLOGY CORPORATION PRO FORMA COMBINED BALANCE SHEET (Unaudited) AS OF MARCH 27, 1998
Historical Pro Forma (in thousands except per share data) Helix GPC Adjustments Combined - -------------------------------------------------------------------------------------------------------------------- ASSETS Current: Cash $ 8,458 $ 1,354 $ 9,812 Investments 25,211 3,818 29,029 Receivables 14,647 2,302 16,949 Inventories 11,963 4,441 16,404 Deferred income taxes 4,215 - $ 695 4,910 Other current assets 1,101 124 1,225 ------- ------- ------- ------- Total Current Assets 65,595 12,039 695 78,329 ------- ------- ------- ------- Property, plant and equipment 27,628 7,433 35,061 Less: accumulated depreciation (18,190) (4,869) (23,059) ------- ------- ------- Net property, plant and equipment 9,438 2,564 12,002 ------- ------- ------- Other assets 6,590 104 6,694 ------- ------- ------- TOTAL ASSETS $81,623 $14,707 $ 695 $97,025 ======== ======= ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY Current: Accounts payable $ 5,764 $ 327 $ 6,091 Payroll and compensation 1,864 505 2,369 Retirement costs 3,176 655 3,831 Income taxes 3,159 265 3,424 Other accrued liabilities 504 797 $ 2,225 3,526 ------- ------- ------- ------- Total current liabilities 14,467 2,549 2,225 19,241 ------- ------- ------- ------- Stockholders' Equity Common stock 19,832 8,417 (6,134) 22,115 Unamortized amount for stock incentive plans - (4,615) 184 (4,431) Capital in excess of par 3,582 - 10,043 13,625 Currency translation adjustment (283) - (283) Retained earnings 44,025 8,356 (5,623) 46,758 ------- ------- ------- ------- Total Stockholders' Equity 67,156 12,158 (1,530) 77,784 ------- ------- ------- ------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $81,623 $14,707 $ 695 $97,025 ======= ======= ======= ======= The accompanying notes are an integral part of these financial statements.
HELIX TECHNOLOGY CORPORATION PRO FORMA COMBINED STATEMENT OF OPERATIONS (Unaudited) FOR THE YEAR ENDED DECEMBER 31, 1997
Historical Pro Forma (in thousands except per share data) Helix GPC Adjustments Combined - ------------------------------------------------------------------------------------------------------------------ Net sales $131,519 $25,558 $157,077 ------------------------------------------------------- Costs and expenses: Cost of sales 69,210 11,588 80,798 Research and development 8,899 2,642 11,541 Selling, general and administrative 24,189 7,228 31,417 ------------------------------------------------------- 102,298 21,458 123,756 ------------------------------------------------------- Operating income 29,221 4,100 33,321 Other income 3,271 227 3,498 ------------------------------------------------------- Income before taxes 32,492 4,327 36,819 Income taxes (11,177) (98) $(1,621) (12,896) ------------------------------------------------------- Net income $ 21,315 $ 4,229 $(1,621) $ 23,923 ======================================================= Net income per share: Basic $ 1.08 $ 1.08 Diluted $ 1.07 $ 1.07 ======================================================= Number of shares used in per share calculations: Basic 19,768 2,310 22,078 Diluted 19,970 2,310 22,280 ======================================================= The accompanying notes are an integral part of these financial statements.
HELIX TECHNOLOGY CORPORATION PRO FORMA COMBINED STATEMENT OF OPERATIONS (Unaudited) FOR THE YEAR ENDED DECEMBER 31, 1996
Historical Pro Forma (in thousands except per share data) Helix GPC Adjustments Combined - ------------------------------------------------------------------------------------------------------------------ Net sales $128,383 $23,282 $151,665 ----------------------------------------------------- Costs and expenses: Cost of sales 68,081 10,811 78,892 Research and development 7,668 2,545 10,213 Selling, general and administrative 20,922 6,851 27,773 -------------------------------------------------------- 96,671 20,207 116,878 -------------------------------------------------------- Operating income 31,712 3,075 34,787 Other income 2,730 207 2,937 -------------------------------------------------------- Income before taxes 34,442 3,282 37,724 Income taxes (12,485) (113) $(1,187) (13,785) ------------------------------------------------------- Net income $ 21,957 $ 3,169 $(1,187) $ 23,939 ======================================================== Net income per share: Basic $ 1.12 $ 1.10 Diluted $ 1.10 $ 1.08 ======================================================== Number of shares used in per share calculations: Basic 19,670 2,118 21,788 Diluted 19,978 2,118 22,096 ======================================================== The accompanying notes are an integral part of these financial statements.
HELIX TECHNOLOGY CORPORATION PRO FORMA COMBINED STATEMENT OF OPERATIONS (Unaudited) FOR THE YEAR ENDED DECEMBER 31, 1995
Historical Pro Forma (in thousands except per share data) Helix GPC Adjustments Combined - ----------------------------------------------------------------------------------------------------------------- Net sales $123,667 $21,703 $145,370 ------------------------------------------------------- Costs and expenses: Cost of sales 67,740 9,941 77,681 Research and development 4,534 1,946 6,480 Selling, general and administrative 19,588 6,098 25,686 ------------------------------------------------------- 91,862 17,985 109,847 ------------------------------------------------------- Operating income 31,805 3,718 35,523 Other income 1,909 99 2,008 ------------------------------------------------------- Income before taxes 33,714 3,817 37,531 Income taxes (12,729) (108) $(1,372) (14,209) ------------------------------------------------------- Net income $ 20,985 $ 3,709 $(1,372) $ 23,322 ======================================================= Net income per share: Basic $ 1.08 $ 1.08 Diluted $ 1.05 $ 1.05 ======================================================= Number of shares used in per share calculations: Basic 19,478 2,114 21,592 Diluted 20,010 2,114 22,124 ======================================================= The accompanying notes are an integral part of these financial statements.
HELIX TECHNOLOGY CORPORATION PRO FORMA COMBINED STATEMENT OF OPERATIONS (Unaudited) FOR THE THREE MONTHS ENDED MARCH 27, 1998
Historical Pro Forma (in thousands except per share data) Helix GPC Adjustments Combined - --------------------------------------------------------------------------------------------------------------- Net sales $25,872 $ 5,621 $31,493 ---------------------------------------------------- Costs and expenses: Cost of sales 13,857 2,842 16,699 Research and development 2,553 634 3,187 Selling, general and administrative 5,695 3,114 8,809 ---------------------------------------------------- 22,105 6,590 28,695 ------------------------------------------------------- Operating income 3,767 (969) 2,798 Other income 690 38 728 ------------------------------------------------------- Income before taxes 4,457 (931) 3,526 Income taxes (1,516) (145) $296 (1,365) ------------------------------------------------------- Net income $ 2,941 $(1,076) $296 $ 2,161 ======================================================= Net income per share: Basic $ .15 $ .10 Diluted $ .15 $ .10 ======================================================= Number of shares used in per share calculations: Basic 19,832 2,383 22,215 Diluted 19,990 2,383 22,373 ======================================================= The accompanying notes are an integral part of these financial statements.
HELIX TECHNOLOGY CORPORATION PRO FORMA COMBINED STATEMENT OF OPERATIONS (Unaudited) FOR THE THREE MONTHS ENDED MARCH 28, 1997
Historical Pro Forma (in thousands except per share data) Helix GPC Adjustments Combined - -------------------------------------------------------------------------------------------------------------------- Net sales $29,022 $5,386 $34,408 ------------------------------------------------------- Costs and expenses: Cost of sales 15,559 2,526 18,085 Research and development 1,875 583 2,458 Selling, general and administrative 5,745 1,544 7,289 ------------------------------------------------------- 23,179 4,653 27,832 ------------------------------------------------------- Operating income 5,843 733 6,576 Other income 654 22 676 ------------------------------------------------------- Income before taxes 6,497 755 7,252 Income taxes (2,339) (25) $(281) (2,645) ------------------------------------------------------- Net income $ 4,158 $ 730 $(281) $ 4,607 ======================================================= Net income per share: Basic $ .21 $ .21 Diluted $ .21 $ .21 ======================================================= Number of shares used in per share calculations: Basic 19,738 2,118 21,856 Diluted 19,918 2,118 22,036 ======================================================= The accompanying notes are an integral part of these financial statements.
HELIX TECHNOLOGY CORPORATION AND GRANVILLE-PHILLIPS COMPANY NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS 1. The unaudited pro forma combined financial statements of Helix Technology Corporation ("Helix") and Granville- Phillips Company ("GPC") give retroactive effect to the merger, which has been accounted for as a pooling of interest, as if the combining companies had been merged for all periods presented. 2. The unaudited pro forma combined financial statements combine historical financial data of Helix for the three months ended March 27, 1998 and March 28, 1997 and the years ended December 31, 1997, 1996 and 1995 with financial data of GPC for the three months ended March 31, 1998 and 1997 and the years ended December 31, 1997, 1996 and 1995. 3. GPC was treated as a Subchapter S Corporation for income tax purposes for periods subsequent to December 31, 1994 and, as such, income was taxed at the shareholder level. As a result of the merger, the tax status o GPC has changed from a Subchapter S Corporation to a C-Corporation. The adjustment for income taxes in the unaudited pro forma combined statements of operations is to reflect income taxes for GPC at the statutory rates (after effect of permanent differences) in effect during the periods presented as if GPC had been a C Corporation. The adjustment for net deferred tax assets includes the impact of temporary differences between book and tax basis of assets at the date of the merger. In addition, the portion of undistributed earnings ($3,909) generated during the periods that GPC was taxed as an S corporation is transferred from retained earnings to capital in excess of par in accordance with SAB topic 4B. 4. The unaudited pro forma combined earnings per share amounts are based on the combined weighted average number of shares of Helix common stock and GPC common stock outstanding for each period, based on an effective exchange ratio of 3.2265 shares of Helix common stock for each share of GPC common stock. The unaudited pro forma combined balance sheet reflects the issuance of 2,382,925 shares of Helix common stock ($1.00 par value) in exchange for all of the outstanding common stock of GPC at May 7, 1998. 5. The unaudited pro forma combined financial statements do not include adjustments to conform the accounting policies of GPC to those followed by Helix. The nature and extent of such adjustments, if any, will be based upon further study and analysis and are not expected to be material. 6. Merger and other costs to be incurred by Helix and GPC are estimated to be approximately $3,555 including approximately $1,750 of compensation expense to be recorded relating to a mark-to-market adjustment for performance shares and shares of common stock owned by certain key employees under various stock incentive plans. Selling, general and administration expenses for GPC for the three months ended March 31, 1998 includes approximately $1,350 of the mark-to-market adjustment. The remaining merger and other costs will be charged against net income in the second quarter when the merger is completed and accordingly, the effects of these costs have not been reflected in the unaudited pro forma combined statements of operations. Total merger and other costs have been reflected in the unaudited pro forma combined balance sheet. 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. HELIX TECHNOLOGY CORPORATION Date: July 14, 1998 By: /s/Michael El-Hillow Michael El-Hillow Senior Vice President and Chief Financial Officer INDEX TO EXHIBITS Exhibit Number Description EX-23 Independent Auditor's Consent EX-23 2 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS EXHIBIT 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the inclusion in this Form 8-K/A of Helix Technology Corporation of our report dated February 18, 1998 (except for the matter discussed in Note 10, as to which the date is May 7, 1998) on Granville-Phillips Company. It should be noted that we have not audited any financial statements of Granville-Phillips Company subsequent to December 31, 1997 or performed any audit procedures subsequent to the date of our report. /s/Arthur Andersen LLP Denver, Colorado July 13, 1998 -----END PRIVACY-ENHANCED MESSAGE-----