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
August 3, 1998
(Date of earliest event reported)
UNITRODE CORPORATION
(Exact name of Registrant as specified in its charter)
Maryland 1-5609 04-2271188
(State of Incorporation) (Commission File No.) (IRS Employer
Identification No.)
7 Continental Boulevard, Merrimack, NH 03054
(Address of principal executive offices, including zip code)
(603) 424-2410
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Item 7. Financial Statement, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired. An unaudited balance sheet
for BENCHMARQ Microelectronics, Inc. ("BENCHMARQ") dated as of June 30,
1998 and unaudited statements of income and statements of cash flow for the
six months ended June 30, 1998 attached hereto as Exhibit 99.1 are hereby
incorporated herein by reference. The financial statements reported in the
Annual Report on Form 10-K dated December 31, 1997 and in the Quarterly
Reports on Form 10-Q dated June 30, 1997, each filed by BENCHMARQ, have
been previously filed and accordingly, are not included herein.
(b) Pro Forma Financial Information. The unaudited pro forma combined
condensed financial statements attached hereto as Exhibit 99.2 assume a
business combination between Unitrode Corporation ("Unitrode") and
BENCHMARQ accounted for on a "pooling of interests" basis and are based on
the respective historical financial statements and the notes thereto of
Unitrode and BENCHMARQ, and are hereby incorporated herein by reference.
The unaudited pro forma combined condensed balance sheet combines
Unitrode's unaudited consolidated balance sheet with BENCHMARQ's as of
August 1, 1998. The unaudited pro forma combined condensed statements of
operations combine Unitrode's historical operating results for the six
months ended August 1, 1998 and August 2, 1997 and the fiscal years ended
January 31, 1998, 1997 and 1996 with the corresponding BENCHMARQ historical
operating results for the six months ended August 1, 1998 and June 30, 1997
and for the fiscal years ended December 31, 1997, 1996 and 1995,
respectively.
For the purposes of the preparation of the unaudited pro
forma combined condensed balance sheet, merger-related expenses (which the
companies anticipate will be approximately $2.7 million on a pre-tax basis)
were included.
The unaudited pro forma combined condensed financial
statements are presented for illustrative purposes only and are not
necessarily indicative of the operating results or financial position that
would have been achieved if the Merger had been consummated as of the
beginning of the periods presented, nor are they necessarily indicative of
the future operating results or financial position of the combined company.
The unaudited pro forma combined condensed financial statements do not give
effect to any cost savings or integration costs which may result from the
combination of Unitrode's and BENCHMARQ's operations.
These unaudited pro forma combined condensed financial
statements are based on, and should be read in conjunction with, the
historical consolidated financial statements and the related notes thereto
of Unitrode and BENCHMARQ, which have been previously filed.
(c) Exhibits.
Exhibit No. Description
- ----------- -----------
99.1 Financial Statements of BENCHMARQ Microelectronics, Inc.
99.2 Pro Forma Financial Information
SIGNATURE
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.
UNITRODE CORPORATION
By: /s/ Allan R. Campbell
_______________________________
Allan R. Campbell
Senior Vice President, General
Counsel and Secretary
Date: October 7, 1998
Exhibit Index
Exhibit
No. Description
- -------- ------------
99.1 Financial Statements of BENCHMARQ Microelectronics, Inc.
99.2 Pro Forma Financial Information
EXHIBIT 99.1
BENCHMARQ
UNAUDITED BALANCE SHEET
AS OF JUNE 30, 1998
(AMOUNTS IN THOUSANDS)
Current assets:
Cash and cash equivalents......................... $ 5,157
Short-term investments............................ 14,138
Receivables, net of allowances.................... 3,279
Inventories....................................... 5,940
Deferred income tax assets........................ 889
Prepaid expenses and other assets................. 2,116
-------
Total current assets....................... 31,519
-------
Property and equipment, net............................... 3,346
Equipment under capital lease obligations, net............ 2,187
Other assets and deferred charges......................... 53
Prepayment for product purchases, less current............ 3,360
-------
Total assets.............................................. $40,465
=======
Current liabilities:
Accounts payable................................... $ 1,745
Deferred income on shipments to distributors....... 1,374
Current obligations under capital leases........... 875
Other accrued liabilities.......................... 882
--------
Total current liabilities................... 4,876
Obligations under capital leases, less current obligations. 386
Deferred income taxes...................................... 406
--------
Total liabilities........................... 5,668
--------
Stockholders' equity:
Common stock....................................... 7
Additional paid-in capital......................... 26,516
Retained earnings.................................. 8,284
Net unrealized gain on short-term investments...... 3
Treasury stock, 64,000 common shares, at cost...... (13)
--------
Total stockholders' equity.................. 34,797
--------
Total liabilities and stockholders' equity.................$ 40,465
========
BENCHMARQ
UNAUDITED INCOME STATEMENT ANALYSIS
FOR THE SIX MONTHS ENDED JUNE 30, 1998
(Amounts in Thousands,
Except Per Share Data)
Net revenues.......................................... $17,566
Cost of revenues...................................... 8,960
---------
Gross profit...................................... 8,606
---------
Operating expenses:
Research and development.......................... 1,814
Selling, general and administrative............... 5,614
Merger-related costs.............................. 875
----------
Total operating expenses...................... 8,303
---------
Income from operations................................ 303
----------
Other income (expense):
Interest income................................... 377
Interest expense.................................. (67)
----------
Total other income (expense).................. 310
---------
Income before income tax provisions .................. 613
Income tax provision.................................. 392
----------
Net income............................................ $ 221
=========
Basic earnings per share.............................. $ .03
=========
Diluted earnings per share............................ $ .03
=========
Weighted average shares outstanding................... 7,100
=========
Weighted average shares outstanding -
assuming dilution................................. 7,645
=========
BENCHMARQ
UNAUDITED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED JUNE 30, 1998
(Amounts in Thousands)
Cash flows from operating activities:
NET INCOME.......................................... $ 221
ADJUSTMENTS TO RECONCILE NET INCOME:
DEPRECIATION AND AMORTIZATION.................... 1,118
LOSS ON DISPOSITION OF FIXED ASSETS.............. 1
DEFERRED INCOME TAXES............................ (158)
CHANGE IN OPERATING ASSETS & LIABILITIES:
RECEIVABLES...................................... 1,323
INVENTORIES...................................... (1,248)
PREPAID EXPENSES................................. (289)
OTHER ASSETS..................................... 26
PAYABLES......................................... 80
INCOME TAXES PAYABLE............................. (337)
UNEARNED REVENUE................................. 124
OTHER LIABILITIES................................ (27)
----------
TOTAL ADJUSTMENTS............................. 613
---------
NET CASH PROVIDED BY OPERATING ACTIVITIES:....... 834
---------
CASH FLOW FROM INVESTING ACTIVITIES:
CAPITAL EXPENDITURES................................ (1,166)
INVESTMENT IN EQUITY SECURITIES..................... (12,048)
SALES OF EQUITY SECURITIES.......................... 14,962
--------
NET CASH USED IN INVESTING ACTIVITIES............ 1,748
---------
CASH FLOW FROM FINANCING ACTIVITIES:
COMMON STOCK ISSUANCE UPON EXERCISE OF OPTIONS...... 362
PRINCIPAL PAYMENTS UNDER CAPITAL LEASE OBLIGATIONS.. (670)
----------
NET CASH PROVIDED BY FINANCING ACTIVITIES........ (308)
----------
NET INCREASE IN CASH................................... 2,274
CASH AT BEGINNING OF PERIOD............................ 2,883
--------
CASH AT END OF PERIOD.................................. $ 5,157
=======
EXHIBIT 99.2
UNITRODE AND BENCHMARQ
UNAUDITED PRO FORMA COMBINED CONDENSED BALANCE SHEET
AS OF AUGUST 1, 1998
<TABLE>
<CAPTION>
Pro Forma
---------------------
Unitrode BENCHMARQ Adjustments Combined
-------- --------- ----------- --------
(Amounts in Thousands)
Current assets:
<S> <C> <C> <C> <C>
Cash and cash equivalents................ $ 63,623 $ 7,488 $ -- $ 71,111
Short-term investments................... -- 11,512 -- 11,512
Accounts receivable, net................. 17,290 3,287 -- 20,577
Inventories.............................. 13,735 5,863 -- 19,598
Notes receivable......................... 720 -- -- 720
Deferred income taxes.................... 5,563 889 -- 6,452
Prepaid expenses and other current assets 2,426 2,065 -- 4,491
----------- --------- ------------- -----------
Total current assets................ 103,357 31,104 -- 134,461
--------- -------- ------------- ---------
Property, plant and equipment, net.......... 75,128 3,368 -- 78,496
Equipment under capital lease obligations,
net......................................... -- 2,024 -- 2,024
Other assets and deferred charges........... 1,591 248 -- 1,839
Restricted cash and investments............. 1,115 -- -- 1,115
Notes and other receivables, net............ 2,437 -- -- 2,437
Prepayment of product purchases, less
current..................................... -- 3,360 -- 3,360
Excess of cost over net assets acquired, net 1,554 -- -- 1,554
----------- ----------- ---------- ---------
Total assets................................ $185,182 $40,104 $ $225,286
======== ========== ============ ========
Current liabilities:
Accounts payable......................... $ 8,933 $ 1,442 $ -- $ 10,375
Income taxes payable..................... 1,434 291 -- 1,725
Accrued employee compensation and
benefits................................. 1,835 -- -- 1,835
Accrued distributor liability............ 3,578 (10) -- 3,568
Deferred income on shipments to
distributors............................ -- 1,378 -- 1,378
Current obligations under capital leases. -- 804 -- 804
Other current liabilities................ 4,375 462 400 5,237
--------- -------------- -------- ---------
Total current liabilities........... 20,155 4,367 400 24,922
Obligation under capital leases, less
current..................................... -- 355 -- 355
Deferred income taxes....................... 2,223 405 -- 2,628
Other long-term liabilities................. 941 -- -- 941
---------- ---------------- ------------ -----------
Total liabilities................... 23,319 5,127 400 28,846
--------- --------------- --------- ---------
Stockholders' equity:
Common stock............................. 245 7 65 317
Additional paid-in capital............... 46,721 26,545 (78) 73,188
Retained earnings........................ 115,776 8,436 (400) 123,812
Net unrealized gain on short-term
investments.............................. -- 2 -- 2
Treasury stock........................... -- (13) 13 --
Deferred compensation.................... (879) -- -- (879)
-------- ---------------- ------------- -----------
Total stockholders' equity.......... 161,863 34,977 (400) 196,440
--------- ---------------- ---------- ---------
Total liabilities and stockholders' equity.. $185,182 $ 40,104 $ -- $225,286
======== ============== ============ ========
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
</TABLE>
UNITRODE AND BENCHMARQ
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED AUGUST 1, 1998
<TABLE>
<CAPTION>
Pro Forma
-----------------
Unitrode BENCHMARQ Adjustments Combined
-------- --------- ----------- --------
(Amounts in Thousands, Except Per Share Data)
<S> <C> <C> <C> <C>
Net revenues................................ $57,724 $18,105 $ -- $75,829
Cost of revenues............................ 33,422 9,507 -- 42,929
-------- --------- ------- -------
Gross profit............................ 24,302 8,598 -- 32,900
-------- --------- ------- -------
Operating expenses:
Research and development................ 7,217 2,004 -- 9,221
Selling, general and administrative..... 10,754 4,944 -- 15,698
New fab pre-operating expenses.......... 2,075 -- -- 2,075
Restructuring costs..................... 1,267 -- -- 1,267
Merger-related costs.................... 1,385 933 (2,318) --
-------- ---------- --------- ----------
Total operating expenses............ 22,698 7,881 (2,318) 28,261
------- --------- --------- -------
Income from operations...................... 1,604 717 2,318 4,639
-------- ---------- -------- --------
Other income (expense):
Royalty income.......................... 1,000 -- -- 1,000
Interest income......................... 1,501 369 -- 1,870
Interest expense........................ (6) (64) -- (70)
Non-operating income (expense), net..... (2,277) (2) -- (2,279)
-------- --------- --------- -------
Total other income (expense)........ 218 303 -- 521
--------- --------- --------- ---------
Income before income tax provisions ........ 1,822 1,020 2,318 5,160
Income tax provision........................ 1,209 671 -- 1,880
-------- ---------- --------- --------
Net income.................................. $ 613 $ 349 $ 2,318 $ 3,280
======== ========= ======= =======
Basic earnings per share.................... $ .03 $ .05 $ .10
========== ========== =========
Diluted earnings per share.................. $ .02 $ .05 $ .10
========== ========== =========
Weighted average shares outstanding......... 24,391 7,127 31,518
======== ========= =======
Weighted average shares outstanding -
assuming dilution....................... 24,897 7,629 32,526
======= ========= =======
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
</TABLE>
UNITRODE AND BENCHMARQ
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED AUGUST 2, 1997
<TABLE>
<CAPTION>
Pro Forma
-----------------
Unitrode BENCHMARQ Adjustments Combined
-------- --------- ----------- --------
(Amounts in Thousands, Except Per Share Data)
<S> <C> <C> <C> <C>
Net revenues.............................. $89,018 $23,169 $ -- $112,187
Cost of revenues.......................... 41,770 11,003 411 53,184
-------- -------- ------- --------
Gross profit............................ 47,248 12,166 (411) 59,003
-------- -------- ---------- --------
Operating expenses:
Research and development................ 8,731 1,632 179 10,542
Selling, general and administrative..... 14,590 5,455 (590) 19,455
New fab pre-operating expenses.......... 3,145 -- -- 3,145
-------- --------- -------- ---------
Total operating expenses............... 26,466 7,087 (411) 33,142
-------- -------- ---------- --------
Income from operations.................... 20,782 5,079 -- 25,861
-------- -------- --------- --------
Other income (expense):
Royalty income.......................... 1,650 -- -- 1,650
Interest income......................... 1,313 318 -- 1,631
Interest expense........................ (47) (98) -- (145)
Non-operating income (expense), net..... (297) (37) -- (334)
---------- ---------- --------- ----------
Total other income (expense).......... 2,619 183 -- 2,802
--------- --------- --------- ---------
Income before income tax provision........ 23,401 5,262 -- 28,663
Income tax provision...................... 8,697 1,894 -- 10,591
--------- -------- --------- --------
Net income................................ $14,704 $ 3,368 -- $ 18,072
======= ======== ========== ========
Basic earnings per share.................. $ .63 $ .49 -- $ .60
========== ========== ========== =======
Diluted earnings per share................ $ .60 $ .44 $ .56
========== ========== ===========
Weighted average shares outstanding....... 23,442 6,815 30,257
======== ========= =========
Weighted average shares outstanding -
assuming dilution......................... 24,649 7,676 32,325
======== ========= =========
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
</TABLE>
UNITRODE AND BENCHMARQ
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS
FOR THE FISCAL YEAR ENDED JANUARY 31, 1998
<TABLE>
<CAPTION>
Pro Forma
-----------------
Unitrode BENCHMARQ Adjustments Combined
-------- --------- ----------- --------
(Amounts in Thousands, Except Per Share Data)
<S> <C> <C> <C> <C>
Net revenues................................. $177,603 $44,437 $ -- $222,040
Cost of revenues............................. 83,592 20,740 801 105,133
---------- -------- ----------- ---------
Gross profit.............................. 94,011 23,697 (801) 116,907
---------- -------- ---------- ---------
Operating expenses:
Research and development.................. 17,096 3,087 328 20,511
Selling, general and administrative....... 28,749 10,806 (1,129) 38,426
New fab pre-operating expenses............ 6,289 -- -- 6,289
----------- --------- ------------ ---------
Total operating expenses............. 52,134 13,893 (801) 65,226
---------- -------- ---------- --------
Income from operations....................... 41,877 9,804 -- 51,681
---------- --------- ------- --------
Other income (expense):
Royalty income............................ 2,886 -- -- 2,886
Interest income........................... 2,864 672 -- 3,536
Interest expense.......................... (95) (178) -- (273)
Non-operating income (expense), net....... 279 (32) -- 247
------------ ------------ ------------ ---------
Total other income................... 5,934 462 -- 6,396
----------- ------------ ------------ ---------
Income before income tax provision........... 47,811 10,266 -- 58,077
Income tax provision......................... 17,576 3,595 -- 21,171
---------- ----------- ------------ ---------
Net income................................... $ 30,235 $ 6,671 $ -- $ 36,906
========= ========== =========== ========
Basic earnings per share.....................$ 1.27 $ .97 $ 1.20
=========== ============ ==========
Diluted earnings per share...................$ 1.21 $ .86 $ 1.13
=========== ============ ==========
Weighted average shares outstanding.......... 23,806 6,867 30,673
========== =========== =========
Weighted average shares outstanding -
assuming dilution............................ 24,957 7,752 32,709
========== =========== =========
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
</TABLE>
UNITRODE AND BENCHMARQ
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS
FOR THE FISCAL YEAR ENDED JANUARY 31, 1997
<TABLE>
<CAPTION>
Pro Forma
-----------------
Unitrode BENCHMARQ Adjustments Combined
-------- --------- ----------- --------
(Amounts in Thousands, Except Per Share Data)
<S> <C> <C> <C> <C>
Net revenues............................... $133,526 $40,153 $ -- $173,679
Cost of revenues........................... 63,028 21,820 723 85,571
---------- --------- ---------- ----------
Gross profit............................ 70,498 18,333 (723) 88,108
---------- --------- ---------- ----------
Operating expenses:
Research and development................ 17,976 2,922 219 21,117
Selling, general and administrative..... 23,435 8,575 (942) 31,068
---------- --------- ---------- ----------
Total operating expenses........... 41,411 11,497 (723) 52,185
---------- --------- ----------- ----------
Income from operations..................... 29,087 6,836 -- 35,923
---------- --------- ---------- ----------
Other income (expense):
Royalty income.......................... 2,582 -- -- 2,582
Interest income......................... 2,081 705 -- 2,786
Interest expense........................ (96) (210) -- (306)
Non-operating income (expense), net..... 8 (38) -- (30)
------------- ----------- ---------- -----------
Total other income................. 4,575 457 -- 5,032
----------- ----------- ---------- ----------
Income before income tax provision......... 33,662 7,293 -- 40,955
Income tax provision....................... 12,985 231 -- 13,216
---------- ----------- ---------- ----------
Net income................................. $ 20,677 $ 7,062 $ -- $ 27,739
========= ========= ========= =========
Basic earnings per share................... $ .90 $ 1.06 $ .93
============ ========== =========
Diluted earnings per share................. $ .87 $ .96 $ .89
============ =========== =========
Weighted average shares outstanding........ 23,061 6,640 29,701
========== ========== ==========
Weighted average shares outstanding -
assuming dilution.......................... 23,705 7,391 31,096
========== ========== ==========
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
</TABLE>
UNITRODE AND BENCHMARQ
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS
FOR THE FISCAL YEAR ENDED JANUARY 31, 1996
<TABLE>
<CAPTION>
Pro Forma
-----------------
Unitrode BENCHMARQ Adjustments Combined
-------- --------- ----------- --------
(Amounts in Thousands, Except Per Share Data)
<S> <C> <C> <C> <C>
Net revenues................................ $116,148 $29,215 $ -- $145,363
Cost of revenues............................ 55,165 16,872 535 72,572
---------- -------- ----------- ----------
Gross profit............................. 60,983 12,343 (535) 72,791
---------- -------- ----------- ---------
Operating expenses:
Research and development................. 14,674 2,238 146 17,058
Selling, general and administrative...... 22,313 6,090 (681) 27,722
--------- ------- ----------- --------
Total operating expenses............ 36,987 8,328 (535) 44,780
--------- ------- ----------- --------
Income from operations...................... 23,996 4,015 -- 28,011
--------- ------- ----------- ------
Other income (expense):
Royalty income........................... 2,396 -- -- 2,396
Interest income.......................... 1,682 403 -- 2,085
Interest expense......................... (85) (340) -- (425)
Non-operating income (expense), net...... (37) (6) -- (43)
------------ --------- ---------- -----------
Total other income.................. 3,956 57 -- 4,013
---------- ----------- ----------- ----------
Income before income tax provision.......... 27,952 4,072 -- 32,024
Income tax provision........................ 10,433 270 -- 10,703
--------- ---------- ----------- ---------
Net income.................................. $ 17,519 $ 3,802 $ -- $ 21,321
========= ======== =========== =========
Basic earnings per share.................... $ .76 $ .70 $ .75
========= =========== =========
Diluted earnings per share.................. $ .74 $ .61 $ .71
========= =========== =========
Weighted average shares outstanding......... 22,994 5,451 28,445
========== ========== ==========
Weighted average shares outstanding -
assuming dilution.......................... 23,814 6,273 30,087
========== ========== ==========
See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
</TABLE>
NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
1. The unaudited pro forma combined condensed financial statements of
Unitrode and BENCHMARQ give retroactive effect to the Merger, which is
being accounted for as a "pooling of interests" and, as a result, such
statements are presented as if the combining companies had been combined
for all periods presented. The unaudited pro forma combined condensed
financial statements reflect the issuance of one share of Unitrode
Common Stock for each share of BENCHMARQ Common Stock in the Merger.
2. The unaudited pro forma combined basic and diluted earnings per share is
based on the combined weighted average number of common shares and
common and dilutive shares of Unitrode Common Stock and BENCHMARQ Common
Stock for each period.
3. On September 29, 1997, the Unitrode stockholders approved a 2-for-1
stock split of the Unitrode Common Stock effected in the form of a 100%
stock dividend distributed on October 14, 1997 to stockholders of record
as of October 6, 1997. All per share and weighted average shares
outstanding data have been restated to reflect the retroactive effect of
the stock split and the adoption of Statement of Financial Accounting
Standards ("SFAS") No. 128.
4. The unaudited pro forma combined condensed financial statements combine
Unitrode's consolidated financial statements as of August 1, 1998, and
for the six months ended August 1, 1998 and August 2, 1997, and the
fiscal years ended January 31, 1998, 1997 and 1996 with BENCHMARQ's
consolidated financial statements as of August 1, 1998, and for the six
months ended August 1, 1998 and June 30, 1997, and the fiscal years
ended December 31, 1997, 1996, and 1995, respectively.
5. The unaudited pro forma combined condensed financial statements include
various adjustments to conform the accounting policies of BENCHMARQ to
those followed by Unitrode.
6. Unitrode and BENCHMARQ estimate they will incur merger-related costs of
approximately $2.7 million, including investment advisory fees,
regulatory filing costs, legal and accounting expenses, and other
transaction costs. Merger-related costs incurred to date and recorded in
the historical Unitrode and BENCHMARQ balance sheets as of August 1,
1998 were $2.3 million. Additional merger-related costs and expenses
have been reflected as a pro forma adjustment in the pro forma combined
condensed balance sheet as of August 1, 1998. Unitrode is currently
unable to estimate what total integration costs will be following the
merger but does not anticipate these costs will have a material adverse
effect on the financial condition of the combined company.
7. Certain financial statement balances of BENCHMARQ have been reclassified
to conform with the Unitrode financial statements presentation.
8. Pursuant to "change in control" provisions contained in the BENCHMARQ
Plans, all unvested stock options outstanding will immediately vest upon
completion of the Merger. As a result, for the purposes of the pro forma
disclosures required by SFAS No. 123, "Accounting for Stock-Based
Compensation," the additional pro forma expense for the 1,054,575
unvested options, as of December 31, 1997, which would immediately vest
as a result of the Merger, would have been approximately $3.8 million.
This additional pro forma expense of $3.8 million under SFAS No. 123
would have reduced the pro forma combined basic and dilute earnings per
share of Unitrode and BENCHMARQ for the fiscal year ended January 31,
1998 by $0.11 and $0.10, respectively.
