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 4, 1998
Date of Report
(Date of earliest event reported)
ATMI, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
02-22756 06-1481060
(Commission File Number) (IRS Employer Identification No.)
7 Commerce Drive
Danbury, Connecticut 06810
(Address of principal executive offices) (Zip Code)
(203) 794-1100
(Registrant's telephone number, including area code)
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On August 4, 1998, pursuant to a Merger Agreement dated February 19, 1998
(the "Merger Agreement"), by and among NOW Technologies, Inc., a Minnesota
corporation ("NOW"), ATMI, Inc. a Delaware corporation ("ATMI"), and Glide
Acquisition, Inc., a newly-formed, wholly-owned Delaware subsidiary of ATMI
("Merger Subsidiary"), Merger Subsidiary merged with and into NOW, with NOW
being the surviving corporation (the "Merger"). As a result of the Merger, NOW
became a wholly-owned subsidiary of ATMI.
Pursuant to the Merger, each outstanding share of NOW Common Stock was
converted into .865338 shares of ATMI Common Stock. In the aggregate, 1,593,952
shares of ATMI Common Stock were issued in the Merger. The number of shares of
ATMI Common Stock issued in the Merger was determined pursuant to an exchange
ratio set forth in the Merger Agreement which was established through
negotiations among the parties. In addition, each outstanding option to purchase
one share of NOW Common Stock was converted into a stock option to purchase
.865338 shares of ATMI Common Stock under a stock option plan of ATMI.
The Merger is intended to be a tax-free transaction under the Internal
Revenue Code of 1986, as amended (the "Code"), and will be accounted for as a
pooling of interests. NOW manufactures proprietary, state-of-the-art, high
performance containers and dispensing systems for advanced purity chemicals used
in the manufacture of microelectronics, particularly semiconductor integrated
circuits and active matrix flat panel displays. ATMI intends to continue the
business currently performed by NOW as a division of ATMI.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired
(1) Consolidated financial statements for NOW Technologies, Inc. and
Subsidiaries
(A) Audited consolidated financial statements for the year ended
March 31, 1998 (incorporated by reference herein to ATMI,
Inc. Amendment No. 3 to Form S-4, Registration No.
333-51333).
(B) Unaudited consolidated financial statements for the six
months ended June 30, 1998.
The foregoing financial statements are included on pages 4
through 8 of this report.
(b) Pro Forma Financial Information
(1) Unaudited Pro Forma Combined Financial Statements for ATMI, Inc.
(A) Unaudited pro forma combined financial statements for the
year ended December 31, 1997 (stated to reflect the
acquisitions of NOW Technologies, Inc. and Subsidiaries on
August 4, 1998).
(B) Unaudited pro forma combined financial statements as of and
for the six months ended June 30, 1998 (stated to reflect
the acquisitions of NOW Technologies, Inc. and Subsidiaries
on August 4, 1998).
The foregoing pro forma financial statements are included on
pages 9 through 14 of this report.
(c) Exhibits.
2.01 Merger Agreement by and among ATMI, Inc., Glide Acquisition, Inc.
and NOW Technologies, Inc. dated as of February 19, 1998 (Exhibit
2.03 to ATMI's Registration Statement on Form S-1, Registration
No. 333-46609). (1)
23.01 Consent of Deloitte & Touche LLP. (2)
-------------
(1) Incorporated by reference herein.
(2) Filed herewith.
<PAGE>
NOW Technologies, Inc. and Subsidiaries
Consolidated Balance Sheet
(unaudited)
<TABLE>
<CAPTION>
June 30, 1998
-------------
<S> <C>
Assets
Current assets:
Cash and cash equivalents $ 1,818,000
Accounts receivable, net 1,399,000
Inventories 1,856,000
Prepaid expenses and other 573,000
Deferred income taxes 111,000
------------
Total current assets 5,757,000
Property and equipment, net 4,310,000
Other long-term assets, net 166,000
------------
$ 10,233,000
============
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 511,000
Accrued expenses 473,000
Industrial revenue bond payable 2,900,000
------------
Total current liabilities 3,884,000
Stockholders' equity:
Undesignated stock, 1,000,000 shares authorized,
none issued or outstanding -
Common stock, par value $.01: 4,000,000
shares authorized; Shares issued and
outstanding 1,842,000 18,000
Additional paid-in capital 1,498,000
Retained earnings 4,865,000
Less stockholders' receivables (32,000)
------------
Total stockholders' equity 6,349,000
------------
$ 10,233,000
============
</TABLE>
See accompanying notes.
<PAGE>
NOW Technologies, Inc. and Subsidiaries
Consolidated Statement of Income
(unaudited)
<TABLE>
<CAPTION>
Six months ended
June 30, 1998
-----------
<S> <C>
Sales $ 6,043,000
Cost of sales 3,192,000
-----------
Gross profit 2,851,000
Operating expenses:
Research and development 146,000
Selling, general and administrative 2,503,000
-----------
2,649,000
-----------
Operating income 202,000
Interest income 71,000
Interest expense (70,000)
Other income 51,000
-----------
Income before taxes 254,000
Income taxes 81,000
-----------
Net income $ 173,000
===========
Net income per share-basic $ 0.09
===========
Net income per share-assuming dilution $ 0.09
===========
Weighted average shares outstanding-basic 1,835,000
===========
Weighted average shares outstanding-assuming dilution 1,878,000
===========
</TABLE>
See accompanying notes.
<PAGE>
NOW Technologies, Inc. and Subsidiaries
Consolidated Statement of Cash Flows
(unaudited)
<TABLE>
<CAPTION>
Six months ended June
30, 1998
-----------------------
<S> <C>
Operating activities
Net income $ 173,000
Adjustments to reconcile net income to net cash
used by operating activities:
Depreciation and amortization 503,000
Deferred income taxes 28,000
Changes in operating assets and liabilities
Increase in accounts receivable (1,000)
Increase in inventories (345,000)
Increase in prepaid and other assets (425,000)
Increase in accounts payable 198,000
Decrease in accrued expenses (148,000)
Decrease in other liabilities (107,000)
-----------
Total adjustments (297,000)
-----------
Net cash used by operating activities (124,000)
-----------
Investing activities
Capital expenditures (292,000)
-----------
Net cash used by investing activities (292,000)
-----------
Financing activities
Principal payments on industrial revenue bond
and long-term debt (221,000)
Proceeds from stockholders' receivable 46,000
Proceeds from exercise of stock options 35,000
-----------
Net cash used by financing activities (140,000)
-----------
Net decrease in cash and cash equivalents (556,000)
Cash and cash equivalents, beginning of period 2,374,000
-----------
Cash and cash equivalents, end of period $ 1,818,000
===========
</TABLE>
See accompanying notes.
<PAGE>
NOW Technologies, Inc. and Subsidiaries
Notes To Consolidated Interim Financial Statements
(unaudited)
1. Basis of Presentation
The accompanying unaudited interim financial statements of NOW
Technologies, Inc. and Subsidiaries (the "Company") have been prepared in
accordance with the instructions to Form 10-Q and Rule 10.01 of Regulation S-X
and do not include all of the financial information and disclosures required by
generally accepted accounting principles.
In the opinion of the management of the Company the financial information
contained herein has been prepared on the same basis as the audited Consolidated
Financial Statements for the year ended March 31, 1998 contained in the
Registration Statement on Form S-4 of ATMI, Inc. (Registration No.333-51333) and
includes adjustments (consisting only of normal recurring adjustments) necessary
to present fairly the unaudited quarterly results set forth herein. The
Company's quarterly results have, in the past, been subject to fluctuation and,
thus, the operating results for any quarter are not necessarily indicative of
results for any future fiscal period.
2. Per Share Data
In 1997, the Financial Accounting Standards Board (FASB) issued SFAS No.
128, "Earnings per Share," which was adopted in the fourth quarter of 1997. This
rule changes the way earnings per share is calculated and requires restatement
of all reported prior period amounts. Under the new requirements, basic earnings
per share is calculated by dividing net earnings by the weighted-average number
of common shares outstanding during the period. The diluted earnings per share
computation includes the effect of shares which would be issuable upon the
exercise of outstanding stock options, reduced by the number of shares which are
assumed to be purchased by the Company from the resulting proceeds at the
average market price during the period.
The following table presents the computation of basic and diluted earnings
per share for the six months ended June 30, 1998:
Numerator:
Net income $ 240,000
===========
Denominator:
Denominator for basic earnings per share-
weighted-average shares 1,835,000
Dilutive effect of stock options 43,000
---------
Denominator for diluted earnings per share 1,878,000
=========
Net income per share-basic $ 0.09
===========
Net income per share-assuming dilution $ 0.09
===========
<PAGE>
3. Mergers and Acquisitions
On August 4, 1998, pursuant to a Merger Agreement dated February 19, 1998
(the "Merger Agreement"), by and among NOW Technologies, Inc., a Minnesota
corporation ("NOW"), ATMI, Inc. a Delaware corporation ("ATMI"), and Glide
Acquisition, Inc., a newly-formed, wholly-owned Delaware subsidiary of ATMI
("Merger Subsidiary"), Merger Subsidiary merged with and into NOW, with NOW
being the surviving corporation (the "Merger"). As a result of the Merger, NOW
became a wholly-owned subsidiary of ATMI.
Pursuant to the Merger, each outstanding share of NOW Common Stock was
converted into .865338 shares of ATMI Common Stock. In the aggregate, 1,593,952
shares of ATMI Common Stock were issued in the Merger. The number of shares of
ATMI Common Stock issued in the Merger was determined pursuant to an exchange
ratio set forth in the Merger Agreement which was established through
negotiations among the parties. In addition, each outstanding option to purchase
one share of NOW Common Stock was converted into a stock option to purchase
.865338 shares of ATMI Common Stock under a stock option plan of ATMI.
The Merger is intended to be a tax-free transaction under the Internal
Revenue Code of 1986, as amended (the "Code"), and will be accounted for as a
pooling of interests. NOW manufactures proprietary, state-of-the-art, high
performance containers and dispensing systems for advanced purity chemicals used
in the manufacture of microelectronics, particularly semiconductor integrated
circuits and active matrix flat panel displays. ATMI intends to continue the
business currently performed by NOW as a division of ATMI.
<PAGE>
Unaudited Pro Forma Condensed Combined Financial Statements
The following unaudited pro forma condensed combined balance sheet at June
30, 1998 and the unaudited pro forma condensed combined statements of income for
the six months ended June 30, 1998 and 1997 and for the year ended December 31,
1997 give effect to the Merger completed on August 4, 1998, as if the Merger had
occurred on January 1, 1997 for purposes of the statements of operations and at
June 30, 1997 for the condensed combined balance sheet. Under the Merger
Agreement, NOW became a wholly-owned subsidiary of ATMI and each share of NOW
Common Stock was converted into .865338 shares of ATMI Common Stock. In the
aggregate, 1,593,952 shares of ATMI Common Stock were issued in the Merger. The
pro forma information gives effect to the Merger under the pooling-of-interests
method and to the adjustments described in the accompanying notes to the
unaudited pro forma condensed combined financial statements.
The unaudited pro forma condensed combined financial statements may not be
indicative of the results that would have occurred if the Merger had been
consummated as of the dates indicated or the operating results which may be
obtained by ATMI in the future. The unaudited pro forma condensed combined
financial statements should be read in conjunction with the consolidated
financial statements, including the related notes thereto, and other financial
information included in ATMI's Annual Report on Form 10-K/A for the fiscal year
ended December 31, 1997 and ATMI's Quarterly Report on Form 10-Q for the six
months ended June 30, 1998.
<PAGE>
<TABLE>
<CAPTION>
ATMI, INC
PRO FORMA CONDENSED COMBINED BALANCE SHEET (Unaudited)
June 30, 1998
(in thousands)
Pro Forma Pro Forma
ATMI NOW Adjustments ATMI and NOW
--------- ---------- ----------- -------------
<S> <C> <C> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 13,205 $ 1,818 $ 15,023
Marketable securities 73,901 -- 73,901
Accounts receivable, net 16,775 1,399 18,174
Notes and other receivables 1,269 -- 1,269
Inventories 9,815 1,856 11,671
Prepaid expenses and other 4,612 573 $ (425)(b) 4,760
Deferred income taxes -- 111 111
--------- --------- ---------
Total current assets 119,577 5,757 124,909
Property and equipment, net 38,465 4,310 42,775
Goodwill and other long-term assets, net 6,423 166 6,589
--------- --------- ---------
$ 164,465 $ 10,233 $ 174,273
========= ========= =========
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 2,545 $ 511 $ 3,056
Accrued expenses 7,564 473 $1,175(b) 9,212
Current portion of debt 4,168 2,900 7,068
--------- --------- ---------
Total current liabilities 14,277 3,884 19,336
Long-term debt, less current portion 13,451 -- 13,451
Deferred income taxes and other long-term
liabilities 5,355 -- 5,355
Minority interest 663 -- 663
Stockholders' equity:
Common stock 205 18 (18)(a) 221
16 (a)
Additional paid-in capital 103,093 1,498 2 (a) 104,593
Cumulative translation adjustment (917) -- (917)
Retained earnings 28,338 4,865 (1,600)(b) 31,603
Less stockholders' receivables -- (32) (32)
--------- --------- ---------
Total stockholders' equity 130,719 6,349 135,468
--------- ---------- ---------
$ 164,465 $ 10,233 $ 174,273
========= ========== =========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
ATMI, INC.
PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME (Unaudited)
Year Ended December 31, 1997
(in thousands, except shares outstanding and per share data)
Year Ended Year Ended
December 31, March 31,
1997 1998 Pro Forma Pro Forma
ATMI NOW Adjustments ATMI and NOW
--------------- -------------- ----------- -------------------
<S> <C> <C> <C>
Revenues:
Product revenues $ 92,757 $ 14,855 $ 107,612
Contract revenues 9,120 -- 9,120
--------- --------- ---------
Total revenues 101,877 14,855 116,732
Cost of revenues:
Cost of product revenues 40,817 7,353 48,170
Cost of contract revenues 7,867 -- 7,867
--------- --------- ---------
Total cost of revenues 48,684 7,353 56,037
--------- --------- ---------
Gross profit 53,193 7,502 60,695
Operating expenses:
Research and development (c) 10,581 246 $ 701 11,528
Selling, general and administrative (c) 23,153 5,102 (701) 27,554
Non-recurring expenses 9,000 -- 9,000
--------- --------- ---------
42,734 5,348 48,082
--------- --------- ---------
Operating income 10,459 2,154 12,613
Interest income 1,482 110 1,592
Interest expense (1,810) (130) (1,940)
Other income 233 71 304
--------- --------- ---------
Income before taxes and minority interest 10,364 2,205 12,569
Income taxes 5,941 697 6,638
--------- --------- ---------
Income before minority interest 4,423 1,508 5,931
Minority interest (2) - (2)
--------- --------- ---------
Net income (b) $ 4,421 $ 1,508 $ 5,929
======== ======== ==========
Net income per share-basic (e) $0.26 $0.82
======== ========
Net income per share-assuming dilution (e) $0.24 $0.80
======== ========
Net income per share-basic (d) $0.32
=========
Net income per share-assuming dilution (d) $0.29
==========
Weighted average shares outstanding-basic (e) 17,288,000 1,830,000
========== =========
Weighted average shares
outstanding-assuming dilution (e) 18,660,000 1,874,000
========== =========
Weighted average shares outstanding-basic (d) 18,802,000
==========
Weighted average shares
outstanding-assuming dilution (d) 20,354,000
==========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
ATMI, INC.
PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
(Unaudited) Six months ended June 30, 1997
(in thousands, except shares outstanding and per share data)
Pro Forma Pro Forma
ATMI NOW Adjustments ATMI and NOW
-------------- -------------- -------------- ---------------
<S> <C> <C> <C>
Revenues:
Product revenues $ 41,134 $ 7,683 $ 48,817
Contract revenues 4,900 -- 4,900
---------- --------- ---------
Total revenues 46,034 7,683 53,717
Cost of revenues:
Cost of product revenues 18,862 3,657 22,519
Cost of contract revenues 4,039 -- 4,039
---------- ---------- ---------
Total cost of revenues 22,901 3,657 26,558
---------- ---------- ---------
Gross profit 23,133 4,026 27,159
Operating expenses:
Research and development (c) 5,108 105 $ 387 5,600
Selling, general and administrative (c) 10,931 2,530 (387) 13,074
---------- ---------- ---------
16,039 2,635 18,674
---------- ---------- ---------
Operating income 7,094 1,391 8,485
Interest income 781 28 809
Interest expense (825) (69) (894)
Other income 17 39 56
---------- ---------- ---------
Income before taxes and minority interest 7,067 1,389 8,456
Income taxes 1,910 414 2,324
---------- ---------- ---------
Income before minority interest 5,157 975 6,132
Minority interest (25) -- (25)
---------- ---------- ---------
Net income (b) $ 5,132 $ 975 $ 6,107
=========== =========== ==========
Net income per share-basic (e) $0.30 $0.53
=========== ===========
Net income per share-assuming dilution (e) $0.27 $0.52
=========== ===========
Net income per share-basic (d) $0.32
===========
Net income per share-assuming dilution (d) $0.30
===========
Weighted average shares outstanding-basic (e) 17,388,000 1,824,000
========== =========
Weighted average shares outstanding-assuming
dilution (e) 18,745,000 1,878,000
========== =========
Weighted average shares outstanding-basic (d) 18,902,000
==========
Weighted average shares outstanding-assuming
dilution (d) 20,437,000
==========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
ATMI, INC.
PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
(Unaudited) Six months ended
June 30, 1998
(in thousands, except shares outstanding and per share data)
Pro Forma Pro Forma
ATMI NOW Adjustments ATMI and NOW
-------------- -------------- -------------- -------------
<S> <C> <C> <C>
Revenues:
Product revenues $ 44,583 $ 6,043 $ 50,626
Contract revenues 4,423 -- 4,423
--------- ---------- ---------
Total revenues 49,006 6,043 55,049
Cost of revenues:
Cost of product revenues 20,141 3,192 23,333
Cost of contract revenues 3,343 -- 3,343
--------- ---------- ---------
Total cost of revenues 23,484 3,192 26,676
--------- ---------- ---------
Gross profit 25,522 2,851 28,373
Operating expenses:
Research and development (c) 6,053 146 $ 241 6,440
Selling, general and administrative (c) 11,340 2,503 (241) 13,602
--------- ---------- ---------
17,393 2,649 20,042
--------- ---------- ---------
Operating income 8,129 202 8,331
Interest income 1,629 71 1,700
Interest expense (797) (70) (867)
Other income 160 51 211
--------- ---------- ---------
Income before taxes and minority interest 9,121 254 9,375
Income taxes 3,054 81 3,135
--------- ---------- ---------
Income before minority interest 6,067 173 6,240
Minority interest (68) -- (68)
--------- ---------- ---------
Net income (b) $ 5,999 $ 173 $ 6,172
========== ========== ==========
Net income per share-basic (e) $0.32 $0.09
========== ==========
Net income per share-assuming dilution (e) $0.30 $0.09
========== ==========
Net income per share-basic (d) $0.31
=========
Net income per share-assuming dilution (d) $0.29
=========
Weighted average shares outstanding-basic (e) 18,681,000 1,835,000
========== =========
Weighted average shares outstanding-assuming
dilution (e) 19,936,000 1,878,000
========== =========
Weighted average shares outstanding-basic (d) 20,195,000
===========
Weighted average shares outstanding-assuming
dilution (d) 21,625,000
===========
</TABLE>
See accompanying notes.
<PAGE>
Notes To Unaudited Pro Forma Condensed Combined Financial Statements
(a) Pursuant to the Merger Agreement, NOW became a wholly-owned subsidiary of
ATMI. Upon consummation of the Merger, ATMI issued 1,593,952 shares of its
common stock upon the conversion of all of the issued and outstanding
shares of NOW's common stock. The unaudited pro forma condensed combined
financial statements assume that all 1,593,592 shares of ATMI common stock
were issued to the NOW shareholders in accordance with the terms of the
Merger Agreement. The effect of this transaction is to decrease the common
stock of NOW by $18,000 and to increase the combined stated common stock of
ATMI and NOW by $16,000 and additional paid in capital by $2,000 to reflect
the par value of ATMI common stock at the Merger.
(b) The unaudited pro forma condensed combined balance sheet includes
$1,600,000 of transaction costs associated with the Merger. As of June 30,
1998, transaction costs of approximately $193,000 and $232,000 for ATMI and
NOW, respectively, were included in other current assets. The pro forma
condensed combined balance sheet has been adjusted to eliminate such costs
and to recognize additional accrued expenses equivalent to the expected
transaction costs associated with the Merger. Retained earnings have been
adjusted to reflect a net of tax charge to earnings as if the Merger had
occurred on such date. The unaudited pro forma condensed combined
statements of operations do not include costs associated with the
transaction, which are expected to approximate $1,600,000 in the aggregate
and will be charged to earnings in the third quarter of 1998.
(c) The unaudited pro forma condensed combined statement of income includes the
reclassification of various NOW engineering salaries from selling, general
and administrative expense to research and development expense to conform
to ATMI's classification of such costs.
(d) Net income per common share has been computed based upon the weighted
average number of common shares outstanding of ATMI and the equivalent
shares exchanged in the pooling of interests for the Merger of 1,593,952
shares. Net income per common share-assuming dilution has been computed
including the effect of shares which will be issuable upon the exercise of
outstanding stock options. The dilutive effect of stock options is
approximately 106,000 shares.
(e) The calculation of net income per common share has been computed based upon
the weighted average shares outstanding as derived from the historical
consolidated financial statements of ATMI and NOW.
<PAGE>
Exhibit 23.01
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in the Registration Statements
pertaining to the 1998 Employee Stock Purchase Plan (Form S-8 No. 333-55827),
the 1998 Stock Option Plan (Form S-8 No. 333-56349), the 1997 Stock Option Plan
(Form S-8 No. 333-49561), the 1995 Stck Option Plan (Form S-8 No. 33-93048), and
the 1987 Stock Option Plan (Form S-8 No. 33-77060) of ATMI, Inc. of our report
dated May 1, 1998 and contained in Amendment No. 3 to Registration Stateemnt No.
333-51333 of ATMI, Inc. on Form S-4 under the Securities Act of 1933 insofar as
such report relates to the financial statments of NOW Technologies, Inc. and
Subsidiaries as of March 31, 1998 and 1997 and for each of the three years in
the period ended March 31, 1998.
Deloitte & Touche LLP
Minneapolis, Minnesota
October 5, 1998
<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 hereunto duly authorized.
Date: October 9, 1998 ATMI, INC.
/s/ Daniel P. Sharkey
Daniel P. Sharkey
Vice President, Chief Financial Officer and
Treasurer (Chief Accounting Officer)
