UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES ACT OF 1934
Date of Report (Date of earliest event reported) April 13, 1998
--------------
PRAEGITZER INDUSTRIES, INC.
Oregon 34-027932 93-0790158
- --------------------------------------------------------------------------------
(State or other jurisdiction of (Commission (IRS Employer
incorporation or organization) File No.) Identification No.)
1270 SE Monmouth Cut Off Rd., Dallas, OR 97338-9532
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(Address of principal executive offices) (Zip Code)
(503) 623-1000
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(Registrant's telephone number, including area code)
No Change
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
<PAGE>
Item 7. Financial Information, Pro Forma Financial Information and Exhibits
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(a) Financial Statements of Business Acquired.
Pages 5 through 10 of this Form 8-K/A contain the audited balance sheets
of Likom PCB Sdn. Bhd. for the two years ended June 30, 1997 and the
related statements of operations and cash flows for the three years ended
June 30, 1997.
(b) Pro Forma Financial Information.
Pages 11 through 15 of this Form 8-K/A contain the unaudited Pro Forma
Balance Sheet at March 31, 1998, Statement of Operations for year ended
June 30, 1997, and Statement of Operations for the nine months ended March
31, 1998 for the Registrant and Likem PCB Sdn. Bh.
(c) Exhibits.
*2.1 Stock Purchase Agreement, dated as of September 24, 1997, between
Praegitzer Industries, Inc. and Likom PCB Sdn. Bhd.
*2.2 List of omitted schedules to Stock Purchase Agreement, dated as of
September 24, 1997, between Praegitzer Industries, Inc. and Likom
PCB Sdn. Bhd.
23.1 Consent of Ong Boon Bah & Co., independent auditors
- -------------------
*Filed previously.
2
<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.
Dated: June 29, 1998
PRAEGITZER INDUSTRIES, INC.
By: SCOTT GILBERT
-------------------------------------
Scott Gilbert
Treasurer
3
<PAGE>
EXHIBIT INDEX
Sequential
Exhibit No. Description Page No.
- ----------- ----------- ----------
*2.1 Stock Purchase Agreement, dated as of September 24,
1997, between Praegitzer Industries, Inc. and Likom
PCB Sdn. Bhd.
*2.2 List of omitted schedules to Stock Purchase
Agreement, dated as of September 24, 1997, between
Praegitzer Industries, Inc. and Likom PCB Sdn. Bhd.
23.1 Consent of Ong Boon Bah & Co., independent auditors
- --------------
*Filed previously.
4
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors
Likom PCB Sdn Bhd
Kuala Lumpur, Malaysia
We have audited the accompanying balance sheets of Likom PCB Sdn Bhd as of June
30, 1997 and 1996, and the related statements of operations and cash flows for
the three years ended June 30, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated 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 present fairly, in all material
respects, the financial position of Likom PCB Sdn Bhd as of June 30, 1997 and
1996, and the results of its operations and its cash flows for the three years
ended June 30, 1997 in conformity with generally accepted accounting principles.
ONG BOON BAH & CO.
ONG BOON BAH & CO.
Kuala Lumpur, Malaysia
June 29, 1998
5
<PAGE>
<TABLE>
<CAPTION>
LIKOM PCB SDN BHD
(Incorporated in Malaysia)
BALANCE SHEETS
JUNE 30, 1997 AND 1996
- -----------------------------------------------------------------------------------------------------------------
ASSETS 1997 1996
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 94,152 $ 472
Accounts receivable, net of allowance for doubtful accounts
of $58,345 (Note 2) 700,745 2,238,756
Inventories (Note 4) 382,477 684,237
Deferred tax assets 4,441,952 3,194,033
Prepaid expenses 26,345 31,673
------------ ------------
Total current assets 5,645,671 6,149,171
PLANT, EQUIPMENT, AND MOTOR VEHICLES, Net (Note 4) 4,657,713 8,095,307
LONG-TERM INVESTMENT 16,214 341
------------ ------------
TOTAL $ 10,319,598 $ 14,244,819
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 282,036 $ 245,439
Other current liabilities 1,018,575 610,319
Current portion of long-term obligation 1,111,666 1,136,255
------------ ------------
Total current liabilities 2,412,277 1,992,013
LONG-TERM DEBT OBLIGATION, Net of current portion 1,480,779 2,560,232
DEFERRED TAX LIABILITIES 158,007 555,066
SHAREHOLDERS' EQUITY:
Common stock - 50,000,000 shares authorized and 42,740,000
shares issued 16,963,684 17,116,541
Retained earnings (deficit) (10,695,149) (7,979,033)
------------ ------------
Total shareholders' equity 6,268,535 9,137,508
------------ ------------
TOTAL $ 10,319,598 $ 14,244,819
============ ============
See notes to financial statements.
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
LIKOM PCB SDN BHD
(Incorporated in Malaysia)
STATEMENTS OF OPERATIONS
YEARS ENDED JUNE 30, 1997, 1996, AND 1995
- ------------------------------------------------------------------------------------------------------------------------
1997 1996 1995
<S> <C> <C> <C>
REVENUE $ 3,615,256 $ 2,549,748 $ 980,650
COST OF GOODS SOLD 8,927,138 5,675,798 4,958,966
------------ ------------ ------------
Gross loss (5,311,882) (3,126,050) (3,978,316)
SELLING, GENERAL, AND
ADMINISTRATIVE EXPENSE (865,627) (1,369,898) (538,389)
------------ ------------ ------------
OPERATING LOSS (6,177,509) (4,495,948) (4,516,705)
------------ ------------ ------------
OTHER INCOME (EXPENSE):
Interest expense (349,081) (321,951) (147,153)
Other income 2,070,675 103,738 81,400
------------ ------------ ------------
Total other income (expense) 1,721,594 (218,213) (65,753)
------------ ------------ ------------
LOSS BEFORE INCOME TAXES (4,455,915) (4,714,161) (4,582,458)
INCOME TAXES 1,668,545 1,289,388 1,382,239
------------ ------------ ------------
NET LOSS $ (2,787,370) $ (3,424,773) $ (3,200,219)
============ ============ ============
See notes to financial statements.
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
LIKOM PCB SDN BHD
(Incorporated in Malaysia)
STATEMENTS OF CASH FLOWS
YEARS ENDED JUNE 30, 1997, 1996, AND 1995
- -------------------------------------------------------------------------------------------------------------------------------
1997 1996 1995
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (2,787,370) $ (3,424,773) $ (3,200,219)
------------ ------------ ------------
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation 3,390,522 958,115 450,035
Loss on disposal of fixed assets 4,332 - 3,293
Gain on disposal of quoted investment - - (25,272)
Deferred tax (1,668,545) (1,289,388) (1,382,239)
Changes in operating assets and liabilities:
Receivables 1,515,320 (1,837,449) 3,036,048
Inventory 295,649 (155,955) (503,370)
Accounts payable 38,789 (177,775) 308,449
Accrued payroll and related benefit (2,855) (1,141) -
Other current liabilities (556,525) (7,181,655) 6,566,465
------------ ------------ ------------
Net cash provided by operating activities 229,317 (13,110,021) 5,253,190
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets (97,902) (760,232) (5,473,757)
Purchase of investment (15,877) - -
Proceeds from disposal of fixed assets 68,348 - 24,594
Proceeds from disposal of investment - - 31,835
------------ ------------ ------------
Net cash used in investing activities (45,431) (760,232) (5,417,328)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Addition (reduction) in short-term borrowing - (105,007) 200,764
Proceeds from issuance of shares (90,201) 13,912,696 -
------------ ------------ ------------
Net cash provided by (used in) financing activities (90,201) 13,807,689 200,764
------------ ------------ ------------
INCREASE IN CASH AND CASH EQUIVALENTS 93,685 (62,564) 36,626
CASH AND CASH EQUIVALENTS, BEGINNING
OF YEAR 467 63,036 27,936
------------ ------------ ------------
CASH AND CASH EQUIVALENTS, END OF YEAR $ 94,152 $ 472 $ 64,562
============ ============ ============
See notes to financial statements.
</TABLE>
8
<PAGE>
LIKOM PCB SDN BHD
(Incorporated in Malaysia)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 1997, 1996, AND 1995
- --------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business - Likom PCB Sdn Bhd is incorporated in Malaysia, and its
principal business is the manufacturing of printed circuit boards.
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. Actual results could differ from those
estimates.
Revenue Recognition - Revenue is recognized when goods are sold.
Inventories are stated at the lower of cost or market.
Cash and Cash Equivalents includes all cash and short-term debt
instruments, including nonrestricted certificates of deposit, purchased
with an original maturity of three months or less.
Plant, Equipment, and Motor Vehicles - Depreciation of plant, equipment,
and motor vehicles is provided on the straight-line method based on the
estimated useful lives of the individual assets, primarily 3 to 10 years.
Investments with maturities greater than one year are classified as
long-term investments.
2. ACCOUNTS RECEIVABLE
<TABLE>
<CAPTION>
June 30,
--------------------------------------------------
1997 1996 1995
<S> <C> <C> <C>
Trade $ 663,545 $ 605,556 $ 311,447
Other 37,200 1,633,200 112,375
----------- ----------- -----------
Total accounts receivable $ 700,745 $ 2,238,756 $ 423,822
=========== =========== ===========
</TABLE>
9
<PAGE>
3. INVENTORIES
Inventories consist of the following:
<TABLE>
<CAPTION>
June 30,
--------------------------------------------------
1997 1996 1995
<S> <C> <C> <C>
Raw materials $ 210,543 $ 314,493 $ 303,197
Work-in-process 31,526 187,024 182,943
Finished goods 140,408 182,720 54,927
----------- ----------- -----------
Total inventories $ 382,477 $ 684,237 $ 541,067
=========== =========== ===========
</TABLE>
4. PLANT, EQUIPMENT, AND MOTOR VEHICLES
<TABLE>
<CAPTION>
Useful June 30,
Life --------------------------------------------------
(Years) 1997 1996 1995
<S> <C> <C> <C> <C>
Plant and machinery 2-1/2 to 10 $ 8,895,790 $ 8,824,129 $ 8,447,599
Furniture, fitting, and equipment 3 to 10 294,297 432,656 270,269
Computers 5 97,087 95,077 81,679
Motor vehicles 5 43,881 138,484 141,837
----------- ----------- -----------
9,331,055 9,490,346 8,941,384
Less: Accumulated depreciation (4,673,342) (1,395,039) (447,500)
----------- ----------- -----------
Plant, equipment, and motor vehicles $ 4,657,713 $ 8,095,307 $ 8,493,884
=========== =========== ===========
</TABLE>
* * * * * *
10
<PAGE>
<TABLE>
<CAPTION>
PRAEGITZER INDUSTRIES, INC.
PRO FORMA BALANCE SHEET
MARCH 31, 1998
(Unaudited) (Amounts in Thousands)
- ------------------------------------------------------------------------------------------------------------------------
Praegitzer Pro forma
Industries, Likom PCB Pro forma March 31,
ASSETS Inc. Sdn Bhd Adjustments 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 390 $ 125 $ - $ 515
Receivables 26,880 637 - 27,517
Inventories 15,331 559 - 15,890
Prepaid expenses 1,409 501 - 1,910
----------- ----------- ----------- -----------
Total current assets 44,010 1,822 - 45,832
PROPERTY, PLANT, AND EQUIPMENT, Net 78,832 2,872 - 81,704
OTHER ASSETS 13,549 11 - 13,560
----------- ----------- ----------- -----------
TOTAL $ 136,391 $ 4,705 $ - $ 141,096
=========== =========== =========== ===========
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Bank overdraft $ 4,506 $ - $ - $ 4,506
Accounts payable 9,959 677 - 10,636
Accrued payroll and related benefits 4,003 1,336 - 5,339
Other current liabilities 1,199 1,218 - 2,417
Current portion of long term obligations 4,642 2,976 - 7,618
----------- ----------- ----------- -----------
Total current liabilities 24,309 6,207 - 30,516
Long term obligations 65,106 - - 65,106
Deferred tax liability 2,899 - - 2,899
Other liabilities 71 - - 71
Minority interest - - (736) (2) (736)
SHAREHOLDERS' EQUITY:
Common stock 42,324 11,247 (12,013) (2) 41,558
Retained earnings 1,682 (12,749) 12,749 (2) 1,682
----------- ----------- ----------- -----------
Total shareholders' equity 44,006 (1,502) 736 43,240
----------- ----------- ----------- -----------
TOTAL $ 136,391 $ 4,705 $ - $ 141,096
=========== =========== =========== ===========
</TABLE>
11
<PAGE>
<TABLE>
<CAPTION>
PRAEGITZER INDUSTRIES, INC.
PRO FORMA STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1997
(Unaudited) (Amounts in Thousands)
- ------------------------------------------------------------------------------------------------------------------------
Praegitzer Pro forma
Industries, Likom PCB Pro forma June 30,
Inc. Sdn Bhd Adjustments 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenue $ 147,947 $ 3,615 $ - $ 151,562
Cost of goods sold 122,013 8,927 - 130,940
----------- ----------- ----------- -----------
Gross profit (loss) 25,934 (5,312) - 20,622
Selling, general and administrative expense 19,188 866 - 20,054
Impairment and in-process technology expense 11,650 - - 11,650
----------- ----------- ----------- -----------
EARNINGS (LOSS) FROM OPERATIONS (4,904) (6,178) - (11,082)
Interest expense 2,295 349 - 2,644
Other income 568 2,071 - 2,639
Minority interest loss - - 1,366 (1) 1,366
----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES (6,631) (4,456) 1,366 (9,721)
PRO FORMA PROVISION (BENEFIT) FOR
INCOME TAXES 1,670 (1,669) - 1
----------- ----------- ----------- -----------
PRO FORMA INCOME (LOSS) $ (8,301) $ (2,787) $ 1,366 $ (9,722)
=========== =========== =========== ===========
Pro forma loss per share - basic and diluted $ (0.68) $ (0.79)
=========== ===========
Pro forma weighted average shares outstanding 12,234 12,234
=========== ===========
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
PRAEGITZER INDUSTRIES, INC.
PRO FORMA STATEMENT OF OPERATIONS
NINE MONTHS ENDED MARCH 31, 1998
(Unaudited) (Amounts in Thousands)
- --------------------------------------------------------------------------------------------------------------------------
Praegitzer Pro forma
Industries, Likom PCB Pro forma March 31,
Inc. Sdn Bhd Adjustments 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenue $ 133,339 $ 2,137 $ - $ 135,467
Cost of goods sold 106,528 2,889 - 109,417
----------- ----------- ----------- -----------
Gross profit (loss) 26,811 (752) - 26,059
Selling, general and administrative expense 17,166 766 - 17,932
Restructuring charges 1,400 1,400
----------- ----------- ----------- -----------
EARNINGS (LOSS) FROM OPERATIONS 9,645 (2,918) - 6,727
Interest expense 2,288 158 - 2,446
Other income (expense) 166 (28) - 138
Minority interest loss - - 1,521 (1) 1,521
----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES 7,523 (3,104) 1,521 5,940
PRO FORMA PROVISION (BENEFIT) FOR
INCOME TAXES 2,417 - - 2,417
----------- ----------- ----------- -----------
PRO FORMA INCOME (LOSS) $ 5,106 $ (3,104) $ 1,521 $ 3,523
=========== =========== =========== ===========
Pro forma income per share - basic and diluted $ 0.40 $ 0.27
=========== ===========
Pro forma weighted average shares outstanding 12,898 12,898
=========== ===========
</TABLE>
13
<PAGE>
PRAEGITZER INDUSTRIES, INC.
NOTES TO PRO FORMA COMBINED STATEMENTS OF OPERATIONS (Unaudited)
- --------------------------------------------------------------------------------
Effective April 13, 1998, Praegitzer Industries, Inc. ("Praegitzer") acquired
51% of the outstanding capital stock of Likom PCB Sdn Bhd ("Likom"), a printed
circuit board manufacturer located in Malaysia. The acquisition of Likom has
been accounted for using the purchase method of accounting. The purchase price
is up to $5.2 million Malaysian Ringgit ($1,432,000) based on the currency
exchange rate on April 27, 1998, which will consist of the transfer and
contribution to Likom over an eighteen-month period ending in October 1999 of
third-party software license rights, machinery and equipment currently owned by
Praegitzer. At its option Praegitzer may contribute cash in lieu of this
property. The unaudited pro forma combined financial statements reflect an
adjustment for the recognition of the minority interest. No purchase price
adjustments have been recognized as the historical cost of the assets and
liabilities approximates the fair value; accordingly, no goodwill has been
recognized. The unaudited pro forma balance sheet was prepared as if the
transaction had occurred on March 31, 1998, and the pro forma statements of
operations were prepared as if the transaction had occurred on July 1 of the
respective period.
In the opinion of management of Praegitzer, all adjustments necessary to present
fairly such pro forma financial statements have been made. 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) The recognition of the minority interest in the loss from operations during
the respective period.
(2) Elimination of the minority interest in the amounts of common stock and
accumulated deficit in Likom.
14
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement Nos.
333-07533, 333-07535, and 333-09319 on Form S-8 and Registration Statement No.
333-01228 on Form S-3 of Praegitzer Industries, Inc. of our report of Likom PCB
Sdn Bhd dated June 29, 1998, included in this Form 8-K of Praegitzer Industries,
Inc.
ONG BOON BAH & CO.
ONG BOON BAH & CO.
Kuala Lumpur, Malaysia
June 29, 1998
