-----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, TznyhUgXXJixhUtD5QjLGJ/dwdRNzvQXh/WMp4Dfg6MikoZoM1mi/5SwrG8rjIWB Z8Z1KgmNGv25ThAWgkGtyw== 0000950133-96-002810.txt : 19961216 0000950133-96-002810.hdr.sgml : 19961216 ACCESSION NUMBER: 0000950133-96-002810 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960930 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19961213 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENICOM CORP CENTRAL INDEX KEY: 0000766738 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 510271821 STATE OF INCORPORATION: DE FISCAL YEAR END: 1230 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-14685 FILM NUMBER: 96680497 BUSINESS ADDRESS: STREET 1: 14800 CONFERENCE CNTR DR STREET 2: STE 400 WESTFIELDS CITY: CHANTILLY STATE: VA ZIP: 22021-3806 BUSINESS PHONE: 7038029200 8-K/A 1 GENICOM CORPORATION FORM 8-K (AMENDED). 1 ================================================================================ FORM 8-K/A SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): September 30, 1996 Commission File No.: 0-14685 GENICOM CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 51 - 0271821 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 14800 CONFERENCE CENTER DRIVE SUITE 400, WESTFIELDS CHANTILLY, VIRGINIA 20151 (Address of principal executive (Zip Code) offices) Registrant's telephone number, including area code: (703) 802-9200 ================================================================================ 2 GENICOM CORPORATION AND SUBSIDIARIES FORM 8-K/A INDEX Item 7. Financial Statements and Exhibits (a) Financial statements of operation acquired: 3-11 Statements of Assets Acquired and Liabilities Assumed as of December 31, 1994, December 31, 1995, and September 30, 1996 (unaudited); Statements of Revenues and Direct Operating Expenses for the Years ended December 31, 1993, 1994, and 1995 and for the Nine Months ended September 30, 1995 and 1996 (unaudited) and Report of Independent Auditors. (b) Pro forma financial information: 12-17 Transaction Description Pro Forma Consolidated Balance Sheet as of September 29, 1996 (unaudited) Notes to Pro Forma Consolidated Balance Sheet (unaudited) Pro Forma Consolidated Statements of Operations for the Year Ended December 31, 1995 and for the Nine Months Ended September 29, 1996 (unaudited) Notes to Pro Forma Consolidated Statements of Operations (unaudited) Signatures 18
2 3 Item 7 (a) - Financial Statements of Operation Acquired: Statements of Assets Acquired and Liabilities Assumed as of December 31, 1994, December 31, 1995, and September 30, 1996 (unaudited); Statements of Revenues and Direct Operating Expenses for the Years ended December 31, 1993, 1994, and 1995 and for the Nine Months ended September 30, 1995 (unaudited) and 1996 (unaudited) and Report of Independent Auditors. 3 4 Printer Business of Texas Instruments Incorporated Nine Months ended September 30, 1996 and 1995 (Unaudited) and Years ended December 31, 1995, 1994, and 1993 with Report of Independent Auditors 4 5 Report of Independent Auditors The Board of Directors Texas Instruments Incorporated We have audited the accompanying statements of assets acquired and liabilities assumed of the Printer Business of Texas Instruments Incorporated (the Business) at December 31, 1995 and 1994, and the related statements of revenues and direct operating expenses for each year in the three year period ended December 31, 1995. These statements are the responsibility of the management of Texas Instruments Incorporated. Our responsibility is to express an opinion on these statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall statement presentation. We believe that our audit provides a reasonable basis for our opinion. As described in Note 1, the accompanying statements of revenues and direct operating expenses were prepared solely to present the revenues and direct operating expenses of the Business and are not intended to be a complete presentation of the results of operations of the Business. In our opinion, the statements referred to above present fairly, in all material respects, the assets acquired and liabilities assumed of the Business at December 31, 1995 and 1994, and the related revenues and direct operating expenses for each year in the three year period ended December 31, 1995, in conformity with generally accepted accounting principles. ERNST & YOUNG LLP November 26, 1996 5 6 Printer Business of Texas Instruments Incorporated Statements of Assets Acquired and Liabilities Assumed (In Thousands)
SEPTEMBER 30, DECEMBER 31 1996 1995 1994 ---------------------------------------------- (Unaudited) ASSETS Receivables, less allowance for doubtful $ 9,018 $10,083 $13,394 accounts of $241 in 1996, $350 in 1995, and $663 in 1994 (Note 7) Inventory (Note 3) 13,319 18,897 14,910 Equipment, net (Note 4) 243 583 915 Other assets 165 300 480 ---------------------------------------------- Total assets acquired $22,745 $29,699 $29,863 ============================================== LIABILITIES Accrued warranty $ 1,392 $ 2,020 $ 2,683 Other accrued liabilities 403 1,019 760 ---------------------------------------------- Total liabilities assumed $ 1,795 $ 3,039 $ 3,443 ============================================== Assets acquired net of liabilities assumed $20,950 $26,824 $26,256 ==============================================
See accompanying notes. 6 7 Printer Business of Texas Instruments Incorporated Statements of Revenues and Direct Operating Expenses (In Thousands)
NINE MONTHS ENDED SEPTEMBER 30 YEAR ENDED DECEMBER 31 1996 1995 1995 1994 1993 --------------------------------------------------------------------------- (Unaudited) Revenues $92,432 $131,734 $172,234 $195,392 $184,962 Direct operating expenses: Cost of revenues 75,584 105,529 138,127 151,049 144,697 Marketing, general, and administrative 9,673 19,592 25,783 29,461 34,534 Research and development 97 2,979 3,604 8,351 7,120 --------------------------------------------------------------------------- Total direct operating expenses 85,354 128,100 167,514 188,861 186,351 --------------------------------------------------------------------------- Revenues less direct operating expenses $ 7,078 $ 3,634 $ 4,720 $ 6,531 $ (1,389) ===========================================================================
See accompanying notes. 7 8 Custom Manufacturing Services Business of Texas Instruments Incorporated Notes to Financial Statements December 31, 1995 1. BASIS OF PRESENTATION The Printer Business of Texas Instruments Incorporated (the Business) engages in the design, development, marketing, and sale of travel ticket, laser/LED, and serial impact printers and provides supplies and replaceable components for such printers to customers in the United States, Europe, and Asia. The Business has operated as a business activity of Texas Instruments Incorporated (TI). On September 30, 1996, Genicom Corporation (the Buyer) acquired certain assets and assumed certain liabilities of the Business. The acquisition was made pursuant to an Asset Purchase Agreement (the Agreement) dated July 22, 1996, and amended September 30, 1996. The assets acquired included accounts receivable (U.S. trade customers only), inventory, equipment, and other assets primarily related to the Business's operations in Texas and Europe. Cash, real property, accounts payable, and certain laser product inventories were excluded from the assets acquired and liabilities assumed. In addition, product liability claims, environmental claims, and product warranty claims (related to "epidemic failure" as defined in the Agreement) arising from the operation of the Business prior to September 30, 1996 were not assumed by the Buyer and any liability associated with such claims is excluded from these statements. Historically, the Business has had no separate legal status as it was an integral part of TI's overall operations. As a result, separate financial statements have not been maintained for the worldwide Business. The accompanying statements have been prepared from the historical accounting records of TI and present the assets acquired and the liabilities assumed as of December 31, 1995 and 1994, and the revenues and direct operating expenses of the Business for each year in the three year period ended December 31, 1995, including allocations of certain common expenses based upon selected criteria, as defined (Note 2). Since only certain assets of the Business have been acquired and only certain liabilities assumed, statements of financial position and cash flows are not applicable. In addition, no liability for income taxes is recorded, and the statements of revenues and direct operating expenses do not include tax expense. The accompanying statements of revenues and direct operating expenses were prepared to present the net revenues and direct operating costs of the Business. Accordingly, they are not intended to be a complete presentation of the results of operations of the Business, and they do not purport to reflect the revenues and direct operating costs that would have resulted if the Business had operated as an unaffiliated independent entity. The preparation of the statements requires the use of management's estimates, which may vary from actual results. 8 9 Printer Business of Texas Instruments Incorporated Notes to Statements (continued) 2. SIGNIFICANT ACCOUNTING POLICIES ALLOCATION OF EXPENSES TI provides various administrative services to the Business including marketing, data processing and personnel services. TI charged these expenses and all other central operating costs, first on the basis of direct usage when identifiable, with the remainder allocated among TI's division entities on the basis of their respective revenues, headcount, or level of effort. An occupancy charge (consisting of depreciation, rent, and taxes) for TI facilities occupied by the Business was allocated based on square footage used. In the opinion of management of TI, these methods of allocation are reasonable. The charges allocated by TI to the Business are included in the statements of revenues and direct operating expenses for all periods presented. EQUIPMENT Equipment is recorded at cost and depreciated using the 150% declining balance method with an estimated useful life of five years. Amounts related to fully depreciated assets are removed from the financial records. Depreciation included in the statements of revenues and direct operating expenses reflects total direct charges recorded by the Business rather than such depreciation related only to the equipment acquired by the Buyer (see Note 4). Maintenance and repairs are charged to expense as incurred. INVENTORY Inventory is stated at the lower of standard cost (which approximates actuals) or market. Cost is determined using a first-in, first-out method. REVENUES Revenues represent sales to unaffiliated customers and certain other TI operating units. Revenues are recognized when shipments are made. Sales to unaffiliated non-U.S. customers approximated $74.5 million, $74.1 million, and $68.6 million in 1995, 1994, and 1993, respectively. See Note 5 for further discussion of sales to affiliated customers. DIRECT OPERATING EXPENSES Direct operating expenses include the costs of manufacturing the related product shipments included in revenues of the Business. Cost of revenues include direct labor and direct material, and allocations of costs associated with engineering, production planning, manufacturing plant administration, purchasing, and other costs incurred at the manufacturing plants. Research and development expenses are expensed as incurred. Total direct operating expenses are not necessarily indicative of the costs that would have been incurred had the Business operated as a stand-alone business. 9 10 Printer Business of Texas Instruments Incorporated Notes to Statements (continued) 3. INVENTORY
SEPTEMBER 30, DECEMBER 31 1996 1995 1994 --------------------------------------------- (Unaudited) (In Thousands) Raw materials and purchased parts $ 4,502 $ 6,478 $ 6,382 Work in process 735 1,216 1,108 Finished goods 11,326 14,884 9,877 --------------------------------------------- 16,563 22,578 17,367 Less: Reserves for salability and obsolescence 3,244 3,681 2,457 --------------------------------------------- $ 13,319 $18,897 $14,910 =============================================
4. EQUIPMENT
SEPTEMBER 30, DECEMBER 31 1996 1995 1994 --------------------------------------------- (Unaudited) (In Thousands) Equipment, at cost $ 1,712 $ 4,386 $ 4,697 Less: Accumulated depreciation (1,469) (3,803) (3,782) --------------------------------------------- Equipment, net $ 243 $ 583 $ 915 =============================================
Total equipment depreciation expense included in the statement of revenues and direct operating expenses was approximately $888,000, $857,000, and $998,000 in 1995, 1994, and 1993, respectively. See Note 2 for discussion of depreciation. 5. RELATED PARTY TRANSACTIONS Sales to other business units of TI approximated $8.4 million, $3.7 million, and $3.2 million for the years ended December 31, 1995, 1994, and 1993, respectively. These revenues are recorded at cost plus a negotiated gross margin and are not necessarily indicative of revenues that would be recognized on third-party sales. 10 11 Printer Business of Texas Instruments Incorporated Notes to Statements (continued) 6. LEASES The Business leased a materials warehouse in Temple, Texas under an operating lease. The term for this lease ended in 1996. Rental expense associated with this lease was approximately $151 thousand, $146 thousand, and $133 thousand in 1995, 1994, and 1993, respectively. 7. RISK CONCENTRATION Concentrations of credit risk for the Business primarily relate to accounts receivable. Such concentrations for the Business are limited due to its large number of customers, which are dispersed across different geographic areas. The Business maintains an allowance for losses based upon the expected collectibility of accounts receivable. 11 12 Item 7 (b) - Pro Forma Financial Information: On September 30, 1996, the Registrant acquired certain assets of Texas Instruments worldwide printer and related supplies business for the purchase price of approximately $27.9 million, subject to adjustment as provided for in the Asset Purchase Agreement. Based on currently available information, the Registrant does not expect the adjustment to exceed $2.1 million in favor of Texas Instruments. The payment of the preliminary purchase price was financed primarily through the Registrant's credit facility with NationsBank for $19.4 million and a note of $9.0 million to Texas Instruments payable over two years. The Registrant expects to pay any additional purchase price from cash provided by operations. The assets acquired include primarily accounts receivable and inventory. The acquisition is being accounted for as a purchase and the allocation of the purchase price and related acquisition costs is subject to adjustment based upon refinements in the application of purchase method accounting and the final determination of the purchase price. The pro forma financial statements have been prepared by the Registrant's management based upon the financial statements of the Texas Instruments worldwide printer and related supplies business included in this Form 8-K/A. These pro forma financial statements may not be indicative of the results that actually would have occurred if the combination had been in effect on the dates indicated or which may be obtained in the future. The pro forma financial statements should be read in conjunction with the audited financial statements and footnotes included in the Registrant's Annual Report on Form 10-K for the year ended December 31, 1995 and the Texas Instruments audited Statements of Assets Acquired and Liabilities Assumed as of December 31, 1994 and 1995 and Statements of Revenues and Direct Operating Expenses for the years ended December 31, 1993, 1994 and 1995 and footnotes contained in this Form 8-K/A. The pro forma consolidated balance sheet (unaudited) as of September 29, 1996 presents the financial position of the Registrant as if the assets and liabilities of Texas Instruments printer business has been acquired as that date. The pro forma consolidated statements of operations (unaudited) for the year ended December 31, 1995 present the results of operations as if the Texas Instruments printer business had been acquired as of January 2, 1995, taking into consideration only those transactions known to be occurring, and having continuing impact to operations as a result of the acquisition. 12 13 GENICOM CORPORATION AND SUBSIDIARIES PRO FORMA CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER 29, 1996 (UNAUDITED) (In thousands, except share data)
TEXAS PRO FORMA GENICOM INSTRUMENTS ADJUSTMENTS PRO FORMA ============= ============== =============== ============== ASSETS CURRENT ASSETS: Cash and cash equivalents $ 13,969 $ $ $ 13,969 Accounts receivable, less allowance for doubtful accounts of $2,575 53,422 9,018 62,440 Inventories 30,474 13,319 43,793 Prepaid expenses and other assets 5,401 165 5,566 ------------ ------------ ------------- ------------- TOTAL CURRENT ASSETS 103,266 22,502 0 125,768 Property, plant and equipment, net 26,602 243 26,845 Intangibles and other assets 27,744 9,555 (1) 37,299 ------------ ------------ ------------- ------------- $ 157,612 $ 22,745 $ 9,555 $ 189,912 ============ ============ ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Debt maturing within one year $ 3,923 $ $ $ 3,923 Accounts payable and accrued expenses 47,706 1,795 2,100 (4) 51,601 Deferred income 12,325 12,325 ------------ ------------ ------------- ------------- TOTAL CURRENT LIABILITIES 63,954 1,795 2,100 67,849 Long-term debt, less current portion 47,013 28,405 (2) 75,418 Other non-current liabilities 12,498 12,498 ------------ ------------ ------------- ------------- TOTAL LIABILITIES 123,465 1,795 30,505 155,765 STOCKHOLDERS' EQUITY: Common stock 110 110 Additional paid-in capital 26,173 26,173 Retained earnings 9,965 9,965 Foreign currency translation adjustment (1,331) (1,331) Pension liability adjustment (770) (770) Assets acquired, net 20,950 (20,950)(3) 0 ------------ ------------ ------------- ------------- TOTAL STOCKHOLDERS' EQUITY 34,147 20,950 (20,950) 34,147 ------------ ------------ ------------- ------------- $ 157,612 $ 22,745 $ 9,555 $ 189,912 ============ ============ ============= =============
See notes to pro forma consolidated financial statements. 13 14 GENICOM CORPORATION AND SUBSIDIARIES NOTES TO PRO FORMA CONSOLIDATED BALANCE SHEETS (UNAUDITED) 1. This pro forma adjustment reflects the goodwill recognized upon the acquisition of certain assets and liabilities of the Texas Instruments worldwide printer business. 2. This pro forma adjustment reflects the assumed borrowings under the Registrant's credit facilities and the note payable to Texas Instruments. The Registrant has classified the debt as long-term. 3. Eliminate the net assets of the Texas Instruments printer business. 4. Possible additional purchase price payment due to Texas Instruments, subject to review by both parties pursuant to the Asset Purchase Agreement. 14 15 GENICOM CORPORATION AND SUBSIDIARIES PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1995 (UNAUDITED) (In thousands, except per share data)
TEXAS PRO FORMA GENICOM INSTRUMENTS ADJUSTMENTS PRO FORMA ============ ============ ============= ============= REVENUES, NET: $ 294,052 $ 172,234 $ (47,508) (1) $ 418,778 OPERATING COSTS AND EXPENSES: Cost of revenues 217,613 138,127 (38,406) (2) 317,334 Operating expenses 61,261 29,387 (13,635) (3) 77,013 ------------ ------------ ------------- ------------- 278,874 167,514 (52,041) 394,347 ------------ ------------ ------------- ------------- OPERATING INCOME 15,178 4,720 4,533 24,431 Interest expense, net 7,741 2,976 (4) 10,717 ------------ ------------ ------------- ------------- INCOME BEFORE INCOME TAXES 7,437 4,720 1,557 13,714 Income tax expense 1,285 2,134 (5) 3,419 ------------ ------------ ------------- ------------- NET INCOME (LOSS) $ 6,152 4,720 (577) $ 10,295 ============ ============ ============= ============= EARNINGS PER COMMON SHARE AND COMMON SHARE EQUIVALENT (PRIMARY AND FULLY DILUTED) $ 0.51 $ 0.85 ============ ============= WEIGHTED AVERAGE NUMBER OF COMMON SHARES AND COMMON SHARE EQUIVALENTS OUTSTANDING Primary 12,038 12,038 ============ ============= Fully diluted 12,056 12,056 ============ =============
See notes to pro forma consolidated financial statements. 15 16 GENICOM CORPORATION AND SUBSIDIARIES PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 29, 1996 (UNAUDITED) (In thousands, except per share data)
TEXAS PRO FORMA GENICOM INSTRUMENTS ADJUSTMENTS PRO FORMA ============ ============ ============= ============= REVENUES, NET: $ 211,503 92,432 (15,014) (1) $ 288,921 OPERATING COSTS AND EXPENSES: Cost of revenues 162,516 75,584 (13,650) (2) 224,450 Operating expenses 49,836 9,770 (1,671) (3) 57,935 ------------ ------------ ------------- ------------- 212,352 85,354 (15,321) 282,385 ------------ ------------ ------------- ------------- OPERATING (LOSS) INCOME (849) 7,078 307 6,536 Interest expense, net 3,299 1,945 (4) 5,244 Other income 153 153 ------------ ------------ ------------- ------------- (LOSS) INCOME BEFORE INCOME TAXES (3,995) 7,078 (1,638) 1,445 Income tax (benefit) expense (3,876) 1,850 (5) (2,026) ------------ ------------ ------------- ------------- NET (LOSS) INCOME $ (119) 7,078 (3,488) $ 3,471 ------------ ------------ ------------- ------------- EARNINGS PER COMMON SHARE AND COMMON SHARE EQUIVALENT (PRIMARY AND FULLY DILUTED) $ (0.01) (6) $ 0.29 ------------ ------------ ------------- ------------- WEIGHTED AVERAGE NUMBER OF COMMON SHARES AND COMMON SHARE EQUIVALENTS OUTSTANDING Primary 10,918 12,142 ------------ ------------ ------------- ------------- Fully diluted 10,918 12,164 ------------ ------------ ------------- -------------
See notes to pro forma consolidated financial statements. 16 17 GENICOM CORPORATION AND SUBSIDIARIES NOTES TO PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) 1. Eliminates the revenue associated with the laser printers the Registrant did not acquire. 2. Eliminates the cost of goods associated with the laser printers the Registrant did not acquire. 3. Eliminates operating expenses associated with the laser printers the Registrant did not acquire. Includes $1.4 million and $1.0 million for 1995 and 1996, respectively, for amortization of the goodwill associated with the acquisition. 4. Incremental interest expense on acquisition related borrowings at an effective interest rate of approximately 8.5%. 5. To recognize a consolidated pro forma income tax provision at a rate of 34%. 6. Recalculated using common stock equivalents due to the pro forma statements resulted in net income. 17 18 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. GENICOM Corporation -------------------------------------- Registrant Date: December 13, 1996 \s\James C. Gale -------------------------------------- Signature James C. Gale Senior Vice President Finance and Chief Financial Officer (Mr. Gale is the Chief Financial Officer and has been duly authorized to sign on behalf of the Registrant) 18 19 GENICOM CORPORATION AND SUBSIDIARIES INDEX TO EXHIBITS TO FORM 8-K/A SEPTEMBER 30, 1996
EXHIBIT NUMBER DESCRIPTION PAGE - ------------ ------------------------------------------------------------------ ----------------- 23 Consent of Independent Auditor E-2
E - 1 EX-23 2 CONSENT. 1 Exhibit 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS We consent to the use of our report dated November 26, 1996, with respect to the statements of assets acquired and liabilities assumed and the statements of revenues and direct operating expenses of the Printer Business of Texas Instruments Incorporated included in the Current Report on Form 8-K/A of GENICOM Corporation filed on December 13, 1996 with the Securities and Exchange Commission. ERNST & YOUNG LLP Dallas, Texas December 12, 1996 -----END PRIVACY-ENHANCED MESSAGE-----