<PAGE>
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: June 12, 1998
-----------------------
YAHOO! INC.
(Exact name of registrant as specified in its charter)
0-26822
(Commission File Number)
CALIFORNIA 77-0398689
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3420 CENTRAL EXPRESSWAY
SANTA CLARA, CALIFORNIA 95051
(Address of principal executive offices, with zip code)
(408) 731-3300
(Registrant's telephone number, including area code)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On June 4, 1998, Yahoo! Inc., a California corporation ("Yahoo!"), entered
into an Agreement and Plan of Merger ("Agreement") by and among Yahoo!, XY
Acquisition Corporation, a wholly-owned subsidiary of Yahoo!, and Viaweb Inc., a
Delaware corporation ("Viaweb"). Pursuant to the Agreement, on June 10, 1998
all outstanding shares of Viaweb capital stock were converted into 787,182
shares of capital stock and options to purchase Viaweb capital stock were
converted into options to purchase 122,252 shares of Yahoo! Common Stock.
After discussions with the Staff at the Securities and Exchange Commission
(the "Staff"), Yahoo! has adjusted the allocation of the purchase price related
to the acquisition of Viaweb. As a result, the amount of the charge taken in
the second quarter of 1998 for in-process reasearch and development in
connection with the acquisition was reduced from $44,100,000 to $15,000,000.
Although Yahoo!, with the concurrence of its independent accountants, believes
that its original accounting treatment was in accordance with generally accepted
accounting principles, it has accepted the Staff's view with respect to these
matters. As a result, Item 7b of the Company's Current Report on Form 8-K
originally filed on June 12, 1998 is amended to read as follows:
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(b) PRO FORMA FINANCIAL INFORMATION
UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS
The following unaudited pro forma condensed financial statements give
effect to the acquisition of Viaweb Inc. ("Viaweb") by Yahoo! Inc. ("Yahoo!") in
a transaction to be accounted for as a purchase in accordance with APB Opinion
No. 16 (the "Acquisition"). Under the purchase method of accounting, the
purchase price is allocated to the assets acquired and liabilities assumed based
on their estimated fair values at the date of the Acquisition. Estimates of the
fair values of the assets and liabilities of Viaweb have been combined with the
recorded values of the assets and liabilities of Yahoo! in the unaudited pro
forma condensed financial statements. The pro forma adjustments are based on
management's estimates of the fair values of the tangible assets acquired.
Minor changes to adjustments included in the unaudited pro forma condensed
financial statements are expected as the results of operations of Viaweb
subsequent to March 31, 1998 will affect the allocation of the purchase price.
Accordingly, actual amounts will differ from those in the unaudited pro forma
condensed financial statements.
The unaudited pro forma condensed balance sheet has been prepared to
reflect the Acquisition as if it occurred on March 31, 1998. The unaudited pro
forma condensed statements of operations reflect the results of operations of
Yahoo! and Viaweb for the year ended December 31, 1997 and the three months
ended March 31, 1998 as if the Acquisition occurred on January 1, 1997.
The unaudited pro forma condensed financial statements are presented for
illustrative purposes only and are not necessarily indicative of the combined
financial position or results of operations in future periods or the results
that actually would have been realized had Yahoo! and Viaweb been a combined
company during the specified periods. The unaudited pro forma condensed
financial statements, including the notes thereto, are qualified in their
entirety by reference to, and should be read in conjunction with, the historical
consolidated financial statements of Yahoo!, included in its Annual Report on
Form 10-K for the year ended December 31, 1997 and quarterly report from Form
10-Q for the three months ended March 31, 1998 and the financial statements of
Viaweb included elsewhere in the Company's Current Report on Form 8-K filed on
June 12, 1998.
<PAGE>
UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
AS OF MARCH 31, 1998
(IN THOUSANDS)
<TABLE>
<CAPTION>
HISTORICAL
------------------------
YAHOO! VIAWEB
MARCH 31, MARCH 31, PRO FORMA
1998 1998 ADJUSTMENTS PRO FORMA
---------- -------- --------- ---------
<S> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 44,977 $ 106 $ - $ 45,083
Short-term investments in marketable securities 71,920 - - 71,920
Accounts receivable, net 12,978 49 - 13,027
Prepaid expenses and other current assets 4,764 222 - 4,986
---------- -------- --------- ---------
Total current assets 134,639 377 - 135,016
Long-term investments in marketable securities 7,647 - - 7,647
Property and equipment, net 8,007 172 - 8,179
Other assets 10,112 12 39,564 (D) 49,688
---------- -------- --------- ---------
Total $ 160,405 $ 561 $ 39,564 $ 200,530
---------- -------- --------- ---------
---------- -------- --------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Notes payable $ - $ 1,228 $ (1,228) (B) $ -
Accounts payable 4,906 370 - 5,276
Accrued expenses and other current liabilities 18,238 188 1,750 (A) 20,176
Deferred revenue 10,102 8 - 10,110
---------- -------- --------- ---------
Total current liabilities 33,246 1,794 522 35,562
Deferred tax liability - - 6,000 (D) 6,000
Minority interests in consolidated subsidiaries 473 - - 473
Shareholders' equity (deficit) 126,686 (1,233) 46,809 (A) 158,495
1,228 (B)
5 (C)
(15,000) (D)
---------- -------- --------- ---------
Total $ 160,405 $ 561 $ 39,564 $ 200,530
---------- -------- --------- ---------
---------- -------- --------- ---------
</TABLE>
See Accompanying Notes to Unaudited Pro Forma Condensed Financial Statements.
<PAGE>
UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1997
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
HISTORICAL
-------------------------
YAHOO! VIAWEB
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, PRO FORMA
1997 1997 ADJUSTMENTS PRO FORMA
---------- -------- --------- ---------
<S> <C> <C> <C> <C>
Net revenues $ 67,411 $ 343 $ - $ 67,754
Cost of revenues 9,372 268 5,000 (E) 14,640
---------- -------- --------- ---------
Gross profit 58,039 75 (5,000) 53,114
---------- -------- --------- ---------
Operating expenses:
Sales and marketing 43,930 863 - 44,793
Product development 11,138 321 - 11,459
General and administrative 6,472 528 - 7,000
Amortization of intangibles - - 3,509 (E) 3,509
Other - nonrecurring costs 25,095 - - 25,095
---------- -------- --------- ---------
Total operating expenses 86,635 1,712 3,509 91,856
---------- -------- --------- ---------
Loss from operations (28,596) (1,637) (8,509) (38,742)
Interest income (expense), net 4,982 (110) - 4,872
Minority interests in operations
of consolidated subsidiaries 727 - - 727
---------- -------- --------- ---------
Net loss $ (22,887) $ (1,747) $ (8,509) $ (33,143)
---------- -------- --------- ---------
---------- -------- --------- ---------
Net loss per share - basic and diluted $ (0.26) $ (0.38) (F)
---------- ---------
---------- ---------
Weighted average common shares and equivalents
used in per share calculation - basic and diluted 87,166 87,954
---------- ---------
---------- ---------
</TABLE>
See Accompanying Notes to Unaudited Pro Forma Condensed Financial Statements.
<PAGE>
UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1998
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
HISTORICAL
------------------------
YAHOO! VIAWEB
THREE MONTHS THREE MONTHS
ENDED ENDED
MARCH 31, MARCH 31, PRO FORMA
1998 1998 ADJUSTMENTS PRO FORMA
---------- -------- --------- ---------
<S> <C> <C> <C> <C>
Net revenues $ 30,206 $ 290 $ - $ 30,496
Cost of revenues 3,917 94 1,250 (E) 5,261
---------- -------- --------- ---------
Gross profit 26,289 196 (1,250) 25,235
---------- -------- --------- ---------
Operating expenses:
Sales and marketing 16,096 237 - 16,333
Product development 4,534 170 - 4,704
General and administrative 1,992 151 - 2,143
Amortization of intangibles - - 877 (E) 877
---------- -------- --------- ---------
Total operating expenses 22,622 558 877 24,057
---------- -------- --------- ---------
Income (loss) from operations 3,667 (362) (2,127) 1,178
Interest income (expense), net 1,446 (105) - 1,341
Minority interests in operations
of consolidated subsidiaries 243 - - 243
---------- -------- --------- ---------
Income (loss) before income taxes 5,356 (467) (2,127) 2,762
Provision for income taxes 1,071 - - 1,071
---------- -------- --------- ---------
Net income (loss) $ 4,285 $ (467) $ (2,127) $ 1,691
---------- -------- --------- ---------
---------- -------- --------- ---------
Net income per share:
Basic $ 0.05 $ 0.02 (F)
---------- ---------
---------- ---------
Diluted $ 0.04 $ 0.02 (F)
---------- ---------
---------- ---------
Weighted average common shares and equivalents
used in per share calculation:
Basic 86,104 86,892
---------- ---------
---------- ---------
Diluted 106,748 107,628
---------- ---------
---------- ---------
</TABLE>
See Accompanying Notes to Unaudited Pro Forma Condensed Financial Statements.
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS
BASIS OF PRESENTATION:
Effective June 10, 1998, Yahoo! acquired Viaweb in exchange for acquisition
consideration consisting of (i) 787,182 shares of Common Stock issued in
exchange for all outstanding shares of Viaweb Common Stock, and (ii) options to
purchase 122,252 shares of Yahoo! Common Stock in exchange for all outstanding
options to purchase Viaweb Common Stock. The Acquisition will be accounted for
as a purchase. Under the purchase method of accounting, the purchase price is
allocated to the assets acquired and liabilities assumed based on their
estimated fair values at June 5, 1998, the date of the acquisition. Estimates
of the fair values of the assets and liabilities of Viaweb have been combined
with the recorded values of the assets and liabilities of Yahoo! in the
unaudited pro forma condensed financial statements.
PRO FORMA ADJUSTMENTS (IN THOUSANDS):
(A) To record the consideration issued by Yahoo! to consummate the
Acquisition. Acquisition consideration consisted of the following:
<TABLE>
<S> <C>
Yahoo! Common Stock and options to purchase Yahoo! Common Stock $ 46,809
Acquisition expenses 1,750
--------
$ 48,559
--------
--------
</TABLE>
(B) To reflect the conversion, effective upon the Acquisition, of $1,228 of
Viaweb convertible notes payable into Viaweb Common Stock. Interest associated
with the convertible notes was not material for any period presented.
(C) To eliminate the historical stockholders' deficit of Viaweb.
(D) To record the excess of the acquisition price over the fair value of assets
and liabilities of $48,564. The book value of tangible assets acquired and
liabilities are assumed to approximate fair value.
<TABLE>
<S> <C>
Total purchase price $ 48,559
Fair value of tangible assets acquired (561)
Fair value of liabilities assumed 566
--------
$ 48,564
--------
--------
</TABLE>
The purchase price is allocated as follows:
<TABLE>
<S> <C>
In-process research and development $ 15,000
Acquired technology (estimated useful life of three years) 15,000
Intangible assets (estimated useful life of seven years) 24,564
Deferred tax liability (6,000)
--------
$ 48,564
--------
--------
</TABLE>
<PAGE>
After discussions with the Staff, Yahoo! has recorded $15,000 of the purchase
price as purchased in-process research and development that has not yet
reached technological feasibility and has no alternative future use. This
amount will be expensed as a non-recurring charge upon consummation of the
acquisition. This amount has been reflected as a reduction to shareholders'
equity and has not been included in the pro forma combined statement of
income due to its non-recurring nature. A deferred tax liability will be
recognized for the difference between the assigned values for book purposes
and the tax bases of assets in accordance with the provisions of Statement of
Financial Accounting Standard No. 109.
(E) To record amortization of purchased technology and other intangible assets
over useful lives of three and seven years, respectively.
(F) Basic pro forma earnings per share is computed using the weighted average
number of Yahoo! common shares outstanding during the period plus shares of
Common Stock assumed to be issued as part of the acquisition. Diluted pro forma
earnings per share is computed using the weighted average number of common and
common equivalent shares outstanding during the period plus shares of Common
Stock and common equivalent shares assumed to be issued as part of the
acquisition. Common equivalent shares consist of the incremental common shares
issuable upon the exercise of stock options and warrants (using the treasury
stock method). Common equivalent shares are excluded from the computation if
their effect is antidilutive. Shares and options issued pursuant to the
Acquisition are assumed outstanding at the beginning of the period.
<PAGE>
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.
YAHOO! INC.
Date: January 21, 1999 By: /s/ GARY VALENZUELA
-----------------------------------
Gary Valenzuela
Senior Vice President, Finance and
Administration, and Chief Financial
Officer
