UNITED STATES
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): August 28, 1996
PRAEGITZER INDUSTRIES, INC.
State of Oregon 4-027932 93-0790158
- --------------------------------------------------------------------------------
(State or other (Commission (IRS Employer
jurisdiction of File No.) Identification No.)
incorporation or
organization)
1270 S.E. Monmouth Cut-Off Road, Dallas, Oregon 97338-9532
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(503) 623-9273
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Not Applicable
- --------------------------------------------------------------------------------
(Former name and former address and former fiscal year,
if changed since last report)
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
-------------------------------------------------------------------
(a) Financial Statements of Business Acquired.
------------------------------------------
Pages 4 through 13 of this Form 8-K/A contain the audited financial
statements of Trend Circuits, Inc. for the two years ended December 31,
1995.
(b) Pro Forma Financial Information.
--------------------------------
Pages 14 through 15 of this Form 8-K/A contain unaudited interim
financial statements for the six months ended June 30, 1995 and 1996, and
an unaudited balance sheet of Trend Circuits, Inc. dated as of June 30,
1996 and Pro Forma Combined Statements of Operations for the Registrant and
Trend Circuits, Inc. for the six months ended June 30, 1996 and for the 12
months ended December 31, 1995.
(c) Exhibits.
---------
None
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders of
Trend Circuits, Inc.
We have audited the accompanying combined balance sheets of Trend Circuits,
Inc. as of December 31, 1995 and 1994, and the related statements of
income, stockholders' equity and cash flows for the years then ended. 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. These 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 such financial statements present fairly, in all material
respects, the financial position of Trend Circuits, Inc. as of December 31,
1995 and 1994 and the results of its operations and its cash flows for the
years then ended in conformity with generally accepted accounting
principles.
As discussed in Note 11 to the financial statements, on March 31, 1996, the
Company and certain of its stockholders entered into various agreements
with the Company's controlling stockholder and Chief Executive Officer,
including an agreement to purchase 5,096 shares of common stock from the
Company's controlling stockholder. As also discussed in Note 11, on August
16, 1996, the Company's stockholders agreed, subject to certain conditions,
to merge with another company.
DELOITTE & TOUCHE LLP
August 16, 1996
-3-
<PAGE>
<TABLE>
<CAPTION>
TREND CIRCUITS, INC.
BALANCE SHEETS
DECEMBER 31, 1995 AND 1994
- --------------------------------------------------------------------------------
ASSETS 1995 1994
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 39,752 $ 43,798
Accounts receivable, less allowance for
doubtful accounts of $45,000 3,300,167 2,064,876
Inventories 626,297 515,038
Prepaid expenses 135,685 150,382
------------------ -----------------
Total current assets 4,101,901 2,774,094
PROPERTY AND EQUIPMENT - Net 4,043,179 2,967,635
NOTES RECEIVABLE - Related parties 186,703 187,026
OTHER ASSETS 76,104 43,257
DEFERRED INCOME TAXES 54,056 20,509
------------------ -----------------
TOTAL $ 8,461,943 $ 5,992,521
================== =================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Line of credit $ 400,000 $ 600,000
Current portion of long-term obligations 3,277,214 522,623
Accounts payable 927,968 729,121
Accrued employee costs 676,981 374,024
Accrued commissions 200,001 138,608
Other accrued expenses 145,304 65,091
Income taxes payable 32,298 10,702
------------------ -----------------
Total current liabilities 5,659,766 2,440,169
LONG-TERM OBLIGATIONS 907,901 1,446,328
DEFERRED INCOME TAXES 30,385 22,294
STOCKHOLDERS' EQUITY:
Common stock, $10 par value; 10,000 shares 76,140 70,440
authorized; 7,614 and 7,044 shares
outstanding in 1995 and 1994,
respectively
Additional paid-in capital 575,705 468,905
Retaining earnings 1,212,046 1,544,385
------------------ -----------------
Total stockholders' equity 1,863,891 2,083,730
------------------ -----------------
TOTAL $ 8,461,943 $ 5,992,521
================== =================
See notes to financial statements.
</TABLE>
-4-
<PAGE>
<TABLE>
<CAPTION>
TREND CIRCUITS, INC.
STATEMENTS OF INCOME
YEARS ENDED DECEMBER 31, 1995 AND 1994
- --------------------------------------------------------------------------------
1995 1994
<S> <C> <C>
NET SALES $ 22,462,072 $ 15,423,103
COST OF GOODS SOLD 14,569,708 10,751,445
----------------- ----------------
Gross profit 7,892,364 4,671,658
----------------- ----------------
EXPENSES:
Sales and marketing 2,726,720 2,328,691
General and administrative 2,369,221 1,571,441
Total expenses 5,095,941 3,900,132
----------------- ----------------
INCOME FROM OPERATIONS 2,796,423 771,526
OTHER EXPENSE - Net 857,620 205,650
================= ================
INCOME BEFORE INCOME TAXES 1,938,803 565,876
PROVISION (CREDIT) FOR STATE INCOME TAXES 22,142 (3,199)
----------------- ----------------
NET INCOME $ 1,916,661 $ 569,075
================= ================
See notes to financial statements.
</TABLE>
-5-
<PAGE>
<TABLE>
<CAPTION>
TREND CIRCUITS, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 1995 AND 1994
- -------------------------------------------------------------------------------
COMMON STOCK ADDITIONAL TOTAL
---------------------------- PAID-IN RETAINED STOCKHOLDERS'
SHARES AMOUNT CAPITAL EARNINGS EQUITY
<S> <C> <C> <C> <C> <C>
BALANCE, January 1, 1994 7,044 $ 70,440 $ 468,905 $ 975,310 $ 1,514,655
Net income 569,075 569,075
---------- ------------ ------------- --------------- ----------------
BALANCE, December 31, 1994 7,044 70,440 468,905 1,544,385 2,083,730
Sale of common stock 570 5,700 106,800 112,500
Net income 1,916,661 1,916,661
Stockholder distributions (2,249,000) (2,249,000)
---------- ------------ ------------- --------------- ----------------
BALANCE, December 31, 1995 7,614 $ 76,140 $ 575,705 $ 1,212,046 $ 1,863,891
========== ============ ============= =============== ================
See notes to financial statements.
</TABLE>
-6-
<PAGE>
<TABLE>
<CAPTION>
TREND CIRCUITS, INC.
STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1995 AND 1994
- --------------------------------------------------------------------------------
1995 1994
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 1,916,661 $ 569,075
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 772,328 752,720
Loss on disposal of equipment 678,147 18,699
Deferred income taxes (25,456) (16,725)
Change in operating assets and liabilities:
Accounts receivable (1,235,291) (597,035)
Inventories (111,259) (37,524)
Prepaid expenses 14,697 33,101
Other assets (32,847) (9,213)
Accounts payable 198,847 16,776
Accrued expenses 444,563 115,953
Income taxes payable 21,596 11,907
------------------ ----------------
Net cash provided by operating activities 2,641,986 857,734
------------------ ----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease (increase) in notes receivable 323 (59,273)
Purchase of property and equipment (1,244,033) (369,848)
Proceeds from sale of assets 54 1,250
------------------ ----------------
Net cash used by investing activities (1,243,656) (427,871)
------------------ ----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net payment of line of credit (200,000) (535,000)
Repayment of long-term obligations (915,876) (1,138,554)
Proceeds from long-term obligations 1,850,000 1,178,000
Distributions to stockholders (2,249,000) -
Proceeds from sale of stock 112,500 -
------------------ ----------------
Net cash used by financing activities (1,402,376) (495,554)
------------------ ----------------
NET DECREASE IN CASH AND CASH EQUIVALENTS (4,046) (65,691)
CASH AND CASH EQUIVALENTS:
Beginning of year 43,798 109,489
------------------ ----------------
End of year $ 39,752 $ 43,798
------------------ ----------------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Income taxes paid $ 29,360 $ 530
------------------ ----------------
Interest paid $ 287,769 $ 236,081
------------------ ----------------
NONCASH ACTIVITIES:
Noncash activities consist of new equipment of $1,282,040 and $501,736
acquired through additional financing during the years ended December
31, 1995 and 1994, respectively.
See notes to financial statements.
</TABLE>
-7-
<PAGE>
TREND CIRCUITS, INC.
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995 AND 1994
- --------------------------------------------------------------------------------
1. BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
BUSINESS - Trend Circuits, Inc. (the Company) manufacturers and sells
prototype electronic printed circuit boards to customers in the
electronics industry. Virtually all of the Company's sales are on
credit. The Company's headquarters are located in Fremont, California.
ESTIMATES AND ASSUMPTIONS - In accordance with generally accepted
accounting principles, the Company's management prepares the financial
statements utilizing certain estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
CASH AND CASH EQUIVALENTS - Cash and cash equivalents include all
highly liquid investments with original maturities of three months or
less.
CONCENTRATION OF CREDIT RISK - Financial instruments that potentially
subject the Company to concentrations of credit risk consist
principally of trade accounts receivable. The risk is limited due to
the fact that the Company's trade accounts receivable are derived from
sales in various geographic areas to numerous companies varying in
size within the electronic interconnect industry. Additionally, the
Company performs ongoing credit evaluations of its customers'
financial condition and generally does not require collateral, such as
letters of credit or security agreements. Credit losses have
consistently been within management's expectations.
INVENTORIES - Inventories are stated at the lower of cost, using the
first-in, first-out (FIFO) method, or market.
PROPERTY AND EQUIPMENT - Property and equipment are stated at cost
less accumulated depreciation and amortization. Depreciation and
amortization are computed over the Company's estimated useful lives
using the straight-line method as follows:
Furniture and fixtures 10 years
Machinery and equipment 10 years
Computer equipment 7 years
Automobiles 6 years
Leasehold improvements:
Nonbuilding Shorter of lease term or 10 years
Building Shorter of lease term or 20 years
FAIR VALUE OF FINANCIAL INSTRUMENTS - Financial instruments consist of
notes payable. The carrying amount of the Company's notes payable
approximates fair market value based on similar rates available to the
Company.
REVENUE RECOGNITION - Sales are recognized at the time of product
shipment.
INCOME TAXES - Income taxes are accounted for in accordance with
Statement of Financial Accounting Standards No. 109 (SFAS 109),
"Accounting for Income Taxes" which requires an asset and liability
approach for financial accounting and reporting of income taxes.
-8-
<PAGE>
2. INVENTORIES
Inventories at December 31 consist of the following:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Raw materials $ 369,647 $ 273,433
Work in process 198,188 173,512
Finished goods 58,462 68,093
-------------- --------------
$ 626,297 $ 515,038
============== ==============
</TABLE>
3. PROPERTY AND EQUIPMENT
Property and equipment at December 31 consist of:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Machinery and equipment $ 4,614,686 $ 4,457,540
Computers 904,432 736,751
Furniture and fixtures 260,545 215,431
Automobiles 19,903 31,393
Leasehold improvements 2,081,421 1,481,639
Construction in process 335,575 22,951
Tooling 116,205 134,332
----------------- ----------------
8,332,767 7,080,037
Accumulated depreciation and amortization (4,289,588) (4,112,402)
----------------- ----------------
$ 4,043,179 $ 2,967,635
----------------- ----------------
</TABLE>
4. NOTES RECEIVABLE - RELATED PARTIES
The Company has notes receivable from certain officers who are also
stockholders of the Company. The balance of the principal and accrued
interest on these notes were $183,935 and $2,768, respectively, at
December 31, 1995 and $183,935 and $3,091, respectively, at December
31, 1994. Principal and accrued interest on these notes become due in
1998 and 1999 (see the fifth paragraph of Note 11). The interest rate
is 6% per annum for all notes.
5. FINANCING ARRANGEMENTS
The Company has a line of credit agreement with a bank, which may be
terminated by either party with a 30-day notice to the other party.
The agreement provides for borrowings of up to the lesser of
$3,000,000 or 80% of eligible trade accounts receivable and 80% of
inventory balances. Borrowings bear interest at the bank's prime
lending rate (8.5% at December 31, 1995) plus 1.25%. The line of
credit is collateralized by receivables, inventory, equipment and
deposits. The agreement requires, among other things, that the Company
satisfy certain financial covenants for maintaining minimum levels of
profit, working capital and tangible net worth. The Company was not in
compliance with certain of these covenants at December 31, 1995 and,
therefore, the bank has the right to demand payment at any time of all
amounts outstanding on the line of credit.
-9-
<PAGE>
6. LONG-TERM OBLIGATIONS
Long-term obligations consist of the following:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Notes payable to bank $ 2,393,337 $ 831,300
Notes payable to other financing companies 501,612 532,936
Capital lease obligations (see Note 8) 1,290,166 604,715
------------- -----------
4,185,115 1,968,952
Current portion (3,277,214) (522,623)
------------- -----------
Long-term portion $ 907,901 $ 1,446,328
============= ===========
</TABLE>
The Company has entered into certain financing arrangements including
equipment term notes and capital lease obligations with various
lenders with terms expiring through 1999. These arrangements bear
interest ranging from 8.67% to 23%. Principal and interest or lease
payments are due quarterly or monthly. Each financing arrangement is
collateralized by the applicable underlying equipment purchased by the
Company. Certain of these financing arrangements require, among other
things, that the Company satisfy certain financial covenants for
maintaining minimum levels of profit, working capital and tangible net
worth. At December 31, 1995, the Company was not in compliance with
these covenants. As a result, all notes payable have been classified
as a current obligation in the amount of $2,894,949.
7. PROFIT-SHARING PLAN
The Company has a qualified profit-sharing plan with a 401(k) deferred
compensation provision for all eligible employees of the Company. The
Company contributed for 1995, on the 401(k) portion of the plan, 25%
of amounts contributed by employees not to exceed 4% of each eligible
employee's wages, and a discretionary profit-sharing contribution as
determined by the Company's Board of Directors. The Company
contributions charged to operations for the plan amounted to $45,710
for 1995. No contribution was made for 1994.
8. INCOME TAXES
The Company has elected S corporation status for federal income tax
purposes. Accordingly, the stockholders are responsible for reporting
their pro rata share of the Company's federal taxable income or loss
on their individual tax returns.
The Company's state income tax provision credit consists of:
1995 1994
Current $ 47,598 13,526
Deferred (25,456) (16,725)
--------- ----------
$ 22,142 $ (3,199)
========= ==========
Deferred tax assets at December 31, 1995 and 1994 primarily result
from accruals and reserves not yet recognized for tax return purposes
and accumulated Manufacturer's Investment Credit of $44,512 available
to offset California taxes. This credit will expire in 2005.
-10-
<PAGE>
9. LEASES
Equipment with a cost and accumulated amortization of $1,371,187 and
$696,291 at December 31, 1995 and $1,418,943 and $995,784 at December
31, 1994 has been leased under capital leases. In addition, the
Company rents office and warehouse facilities under operating lease
agreements which expire through 1999.
Future minimum annual capital and operating lease payments at December
31, 1995 are as follows:
<TABLE>
<CAPTION>
FISCAL YEAR OPERATING LEASES CAPITAL LEASES
<S> <C> <C>
1996 $ 640,588 $ 463,288
1997 583,574 400,765
1998 587,696 242,252
1999 317,731 202,708
2000 -- 140,147
---------- ----------
Total minimum lease payments $2,129,589 1,449,160
==========
Amount representing interest (158,994)
----------
Present value of minimum lease payments 1,290,166
Current portion (382,265)
Long-term portion $ 907,901
==========
</TABLE>
Rent expense for office and warehouse facilities and equipment rentals
was approximately $724,757 and $692,995 for the years ended December
31, 1995 and 1994, respectively.
10. MAJOR CUSTOMER
The Company had one customer representing 14% of the total sales for
the fiscal year ended December 31, 1995. During the fiscal year ended
December 31, 1994, there were no customers representing over 10% of
sales.
11. SUBSEQUENT EVENTS
On March 31, 1996, the Company's controlling stockholder and CEO
retired from the Company and simultaneously sold all of his common
stock to the Company and its officers in exchange for $2,229,695 in
nonrecourse notes of which $1,752,340 is payable by the Company and
$477,355 is payable by the officers. The notes bear interest at 10%
per annum and are payable over four years (interest only for the first
year and one-twelfth of the principal plus accrued interest each
quarter thereafter). In the event of a change in control as a result
of a merger, liquidation, etc., the notes become immediately due and
payable. Of the 5,096 shares sold, the Company reacquired and retired
4,005 shares. Additionally, the Company agreed with its officers to
pay the principal and interest on the notes issued by the officers as
the amounts become due in the form of a bonus totaling approximately
$950,000 which includes an amount for the related estimated income
taxes payable by the officers. Consequently, this obligation is to be
recorded by the Company in 1996, with the related deferred
compensation recorded as a reduction to stockholders' equity.
Also on March 31, 1996, as part of the above agreement, the Company
and the former CEO entered into agreements for the former CEO to (1)
provide consulting services until December 31, 1997 for $288,000
payable over seven quarters, (2) receive bonuses totaling $580,137 for
past services, (3) not compete with the Company for a period of four
years for $200,000 payable in installments through 1999 and (4)
receive health and life insurance paid for by the Company. Pursuant to
these agreements, in the event of a change in control as a result of a
merger, liquidation, etc., the amounts specified in (1) through (3)
above under these agreements become immediately due and payable.
-11-
<PAGE>
The following condensed pro forma financial information reflects the
above transactions had these agreements been entered into on December
31, 1995:
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA
<S> <C> <C>
As of December 31, 1995
Total current assets $4,101,901 $ 4,101,901
Total assets 8,461,943 8,661,943
Total liabilities 6,598,052 10,080,529
Total stockholders' equity (deficit) 1,863,891 (1,418,586)
Year ended December 31, 1995:
Operating expenses $5,095,941 $5,676,078
Net income 1,916,661 1,336,524
</TABLE>
On July 24, 1996, the Company committed to purchase approximately
seven acres of land in Fremont, California for a purchase price of
$2,700,000 from an individual (the "Seller") and made a nonrefundable
deposit of $250,000. The closing date for the land purchase is
expected to be in September 1996. The purchase is contingent upon the
Company being acquired by Praegitzer Industries (see below). In the
event the company is not acquired by Praegitzer Industries, the
Company is obligated to purchase a 25,000 square foot building to be
constructed by the Seller.
On August 15, 1996, the Company's stockholders agreed to issue a cash
bonus to certain officers of approximately $190,231. The bonus is
contingent upon the sale of the Company to Praegitzer Industries (see
below) and will be used by the officers to pay off the amount of notes
receivables due from such officers (see Note 4) along with the
estimated income taxes related to the bonus.
On August 16, 1996, the Company and its stockholders entered into an
agreement to sell their ownership interest in the Company to
Praegitzer Industries, an entity also in the printed circuit board
industry. The sale is subject to the satisfaction of certain closing
conditions and is expected to close on August 26, 1996. The estimated
sales price is one million shares of Praegitzer Industries stock and
$5 million in cash. Upon the closing, all amounts to be paid to the
former CEO as discussed above become immediately payable.
-12-
<PAGE>
PRAEGITZER INDUSTRIES, INC.
NOTES TO PRO FORMA STATEMENTS OF OPERATIONS
(UNAUDITED)
Effective August 26, 1996, Praegitzer Industries, Inc. ("Praegitzer")
acquired Trend Circuits, Inc. ("Trend"), a printed circuit board
manufacturer with production facilities in Fremont, California. The
acquisition was accomplished by a merger of Trend with and into Praegitzer.
The acquisition of Trend has been accounted for using the purchase method
of accounting. The purchase price consisted of $5.0 million in cash and
1,000,000 shares of Praegitzer common stock. The unaudited pro forma
combined statements of operations reflect the following: (i) adjustment for
the purchase accounting and estimated fair market value allocation of the
assets acquired and the obligations assumed and (ii) provision for income
taxes as if the combined operations had been taxed as a C corporation for
all periods presented. The unaudited pro forma balance sheet and statement
of operations for the fiscal year ended June 30, 1996 were prepared as if
the transaction had occurred on July 1, 1995.
In the opinion of management of Praegitzer, all adjustments necessary to
present fairly such pro forma financial statements have been made. However,
a one time, nonrecurring charge of $8.0 million related to a portion of the
purchase price allocated to in-process technology which was expensed at the
closing of the transaction has not been included in the pro forma financial
statements. These unaudited pro forma financial statements are not
necessarily indicative of what actual results would have been had the
transaction occurred at the beginning of the respective period nor do they
purport to indicate the results of future operations of Praegitzer.
(1) Depreciation expense associated with the property and equipment of $1.1
million, the amount by which the fair market value of the assets acquired
exceeded the book value of the assets as reflected on the balance sheet of
Trend, on a straight-line basis over five years.
(2) Amortization associated with the goodwill of $9.0 million, the amount
by which the total consideration for the acquisition exceeded the fair
market value of assets acquired less the one-time, nonrecurring charge of
$8.0 million, over eight years on a straight-line basis.
(3) Income tax expense at the pro forma effective tax rates of Praegitzer
for effects of the adjustments set forth in notes (1) through (2).
(4) Gives effect to 1,000,000 shares valued at $10.65 per share issued by
Praegitzer in connection with the acquisition of Trend.
(5) Amount by which the fair market value of the assets or liabilities
differed from historical cost basis of assets or liabilities as reflected
on the balance sheet of Trend.
(6) Goodwill of $9.0 million less the amortization over eight years on a
straight-line basis.
-14-
<PAGE>
<TABLE>
<CAPTION>
PRAEGITZER INDUSTRIES, INC.
PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1996
PRO FORMA
PRAEGITZER TREND ADJUSTMENTS PRO FORMA
INDUSTRIES CIRCUITS, JUNE 30, JUNE 30,
INC. INC. 1996 1996
<S> <C> <C> <C> <C>
Revenue $ 95,101,170 $ 14,379,602 $ - $ 109,480,772
Cost of goods sold 72,941,213 8,732,800 214,295(1) 81,888,308
------------ ------------- ------------ -------------
Gross profit 22,159,957 5,646,802 (214,295) 27,592,464
General and administrative expense 8,895,548 3,827,278 1,125,000(2) 13,847,826
------------ ------------- ------------ -------------
EARNINGS (LOSS) FROM
OPERATIONS 13,264,409 1,819,524 (1,339,295) 13,744,638
Interest expense 1,798,914 821,053 - 2,619,967
Other income 301,642 - - 301,642
------------ ------------- ------------ -------------
INCOME FROM CONTINUING
OPERATIONS BEFORE
INCOME TAXES 11,767,137 998,471 (1,339,295) 11,426,313
PRO FORMA PROVISION FOR
INCOME TAXES 4,472,000 340,000 (509,000)(3) 4,303,000
------------ ------------- ------------ -------------
PRO FORMA INCOME FROM
CONTINUING OPERATIONS $ 7,295,137 $ 658,471 $ (830,295) $ 7,123,313
------------ ------------- ------------ -------------
PRO FORMA INCOME PER SHARE
FROM CONTINUING OPERATIONS $ 0.80 $ 0.70
------------ -------------
PRO FORMA WEIGHTED AVERAGE
SHARES OUTSTANDING 9,110,233 10,110,233
------------ -------------
</TABLE>
-14-
<PAGE>
<TABLE>
<CAPTION>
PRAEGITZER INDUSTRIES, INC.
PRO FORMA BALANCE SHEET
YEAR ENDED JUNE 30, 1996
(UNAUDITED)
PRAEGITZER TREND PRO FORMA
INDUSTRIES CIRCUITS, PRO FORMA JUNE 30,
INC. INC. ADJUSTMENTS 1996
<S> <C> <C> <C> <C>
ASSETS
Cash $ 38,687 $ - $ - $ 38,687
Receivables 13,073,861 3,838,400 (234,077)(5) 16,678,184
Inventories 6,211,755 853,460 106,909 (5) 7,172,124
Prepaid expenses 206,129 293,621 (143,626)(5) 356,124
Current deferred taxes 394,000 - - 394,000
------------ ------------- ------------ -------------
Total current assets 19,924,432 4,985,481 (270,794) 24,639,119
Property, plant, and equipment, net 24,795,705 4,984,974 1,071,475 (5) 30,852,154
Restricted cash 305,956 - - 305,956
Other assets 7,809,968 425,460 (285,339)(5)
------------ ------------- ------------ -------------
TOTAL ASSETS $ 52,836,061 $ 10,395,915 $ 8,390,342 $ 71,622,318
============ ============= ============ =============
LIABILITIES AND EQUITY
Bank overdraft $ 530,817 $ 158,471 $ - $ 689,288
Taxes payable 943,000 55,934 - 998,934
Accounts payable 5,157,913 1,123,172 250,000 (5) 6,531,085
Accrued payroll and related benefits 1,623,439 977,643 (17,040)(5) 2,584,042
Other current liabilities 55,045 449,338 - 504,383
Current portion of long term obligations 870,874 5,040,308 - 5,911,182
------------ ------------- ------------ -------------
Total current liabilities 9,181,088 7,804,866 232,960 17,218,914
------------ ------------- ------------ -------------
Long term obligations 7,694,590 1,481,028 - 9,175,618
Deferred tax liability 896,000 - - 896,000
Contingencies and commitments 423,450 - - 423,450
Common stock 29,932,049 373,458 10,650,000 (4) 40,955,507
Retained earnings 4,708,884 736,563 (2,492,618) 2,952,829
------------ ------------- ------------- -------------
Total shareholders' equity 34,640,933 1,110,021 8,157,382 43,908,336
------------ ------------- ------------ -------------
TOTAL LIABILITIES AND EQUITY $ 52,836,061 $ 10,395,915 $ 8,390,342 $ 71,622,318
============ ============= ============ =============
</TABLE>
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<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
November __, 1996
PRAEGITZER INDUSTRIES, INC.
By MATTHEW J. BERGERON
-------------------------------
Matthew J. Bergeron
Senior Vice President and Chief
Financial Officer
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