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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report: August 8, 2000
(Date of earliest event reported): July 25, 2000
DITECH COMMUNICATIONS CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
000-26209 94-2935531
(Commission File No.) (IRS Employer Identification No.)
825 E. MIDDLEFIELD ROAD
MOUNTAIN VIEW, CA 94043
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (650) 623-1300
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On July 25, 2000, Ditech Communications Corporation, a Delaware
corporation ("Ditech"), acquired Atmosphere Networks, Inc., a Delaware
corporation ("Atmosphere") in a reverse triangular merger in which a
wholly-owned subsidiary of Ditech ("Merger Sub") was merged with and into
Atmosphere. The acquisition was accomplished pursuant to an Agreement and
Plan of Merger and Reorganization (the "Reorganization Agreement"), dated as
of June 21, 2000, as amended, among Ditech, Merger Sub and Atmosphere.
Pursuant to the merger, approximately 841,897 shares of Ditech
Common Stock were issued to the former preferred stockholders of Atmosphere,
and approximately $7.91 million was paid to the former common stockholders of
Atmosphere. In addition, Ditech assumed outstanding options to acquire
Atmosphere Common Stock pursuant to the terms of the Reorganization
Agreement, which become options to issue approximately 122,236 shares of
Ditech Common Stock. In addition, Ditech granted options to purchase up to
750,000 shares of Ditech Common Stock to certain former stockholders of
Atmosphere who became Ditech employees, at an exercise price of $22.50 per
share, which was 50% of the fair market value of the Common Stock on the date
of such grant. The merger is intended to qualify as a tax-free reorganization
under the Internal Revenue Code of 1986, as amended, and was to be accounted
for on a purchase basis.
The terms of the consideration issued in the merger were determined
at the effective time (the "Effective Time") of the merger as follows:
(a) each then-outstanding share of Atmosphere Common Stock was
converted into the right to receive a cash payment equal to
$3.47, which was calculated as (A) the amount equal to
0.0415152 multiplied by (B) $83.5875, the average closing
price of Ditech Common Stock for the specified period prior to
the Effective Time (the "Ditech Average Stock Price");
(b) each then-outstanding share of Series A Preferred Stock of
Atmosphere was converted into the right to receive 0.0415152
of a share of Common Stock of Ditech;
(c) each then-outstanding share of Series C Preferred Stock of
Atmosphere was converted into the right to receive 0.0781217
of a share of Ditech Common Stock, which was calculated as the
fraction of a share of Ditech Common Stock having a numerator
equal to $6.53 and a denominator equal to the Ditech Average
Stock Price.
At the Effective Time, there were no then-outstanding shares of
Atmosphere Series B Preferred Stock, as all such shares were converted into
shares of Atmosphere Series A Preferred Stock.
The fraction 0.0415152 was the fraction having: a numerator equal to
(A) the number of shares of Ditech Common Stock determined by dividing
$88,500,000 by the Ditech Average Stock Price, less (B) the number of shares of
Ditech Common Stock issued in exchange for the
1.
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Series C Preferred Stock of Atmosphere; and a denominator equal to the
difference obtained by subtracting (A) the number of shares of Series C
Preferred Stock of Atmosphere outstanding immediately prior to the Effective
Time, from (B) the Fully Diluted Atmosphere Shares (as defined below). The
"Fully Diluted Atmosphere Shares" was the number of shares equal to the
number of shares of Atmosphere Common Stock outstanding or issuable upon
conversion or exercise of outstanding options and warrants of Atmosphere,
less the number of shares of the Common Stock of Atmosphere held by
individuals who will not be employed by either Atmosphere or Ditech
immediately following the Effective Time, that are either subject to a
repurchase option or purchasable under unvested Atmosphere options.
The cash paid by Ditech in the merger came out of the general funds
of Ditech.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.
It is impracticable for Ditech to file herewith the required
financial statements in this Current Report on Form 8-K. The required financial
statements will be filed by amendment as soon as practicable, but not later than
60 days after the date this Current Report on Form 8-K is required to be filed.
(b) PRO FORMA FINANCIAL INFORMATION
It is impracticable for Ditech to file herewith the required pro
forma financial information in this Current Report on Form 8-K. The required pro
forma financial information will be filed by amendment as soon as practicable,
but not later than 60 days after the date this Current Report on Form 8-K is
required to be filed.
(c) EXHIBITS
The following Exhibits are filed as part of this report:
2.1 Agreement and Plan of Merger and Reorganization, dated as
of June 21, 2000, by and among Ditech Communications
Corporation, a Delaware corporation, Oxygen Acquisition
Corporation, a Delaware corporation, and Atmosphere
Networks, Inc., a Delaware corporation (1)
2.2 Amendment to Agreement and Plan of Merger and
Reorganization, dated as of July 25, 2000, by and among
Ditech Communications Corporation, a Delaware corporation,
Oxygen Acquisition Corporation, a Delaware corporation,
and Atmosphere Networks, Inc., a Delaware corporation
99.1 Press Release, dated June 22, 2000, entitled "Ditech
Communications to Acquire Atmosphere Networks ---
Acquisition Gives Ditech Key Optical Networking Systems
Expertise"
2.
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99.2 Press Release dated as of July 26, 2000, entitled
"Ditech Communications Completes Acquisition of
Atmosphere Networks --- Acquisition Gives Ditech Key
Optical Networking Systems Expertise"
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(1) Incorporated by reference to the correspondingly numbered exhibit to
Ditech's Annual Report on Form 10-K, File No. 000-26209, for the fiscal year
ended April 30, 2000, filed with the Securities and Exchange Commission on July
31, 2000.
3.
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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, thereunto duly authorized.
DITECH COMMUNICATIONS CORPORATION
a Delaware corporation
Dated: August 8, 2000 By: /s/ TIMOTHY K. MONTGOMERY
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Timothy K. Montgomery
President and Chief Executive Officer
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INDEX TO EXHIBITS
2.1 Agreement and Plan of Merger and Reorganization, dated as
of June 21, 2000, by and among Ditech Communications
Corporation, a Delaware corporation, Oxygen Acquisition
Corporation, a Delaware corporation, and Atmosphere
Networks, Inc., a Delaware corporation (1)
2.2 Amendment to Agreement and Plan of Merger and
Reorganization, dated as of July 25, 2000, by and among
Ditech Communications Corporation, a Delaware corporation,
Oxygen Acquisition Corporation, a Delaware corporation,
and Atmosphere Networks, Inc., a Delaware corporation
99.1 Press Release, dated June 22, 2000, entitled "Ditech
Communications to Acquire Atmosphere Networks ---
Acquisition Gives Ditech Key Optical Networking Systems
Expertise"
99.2 Press Release dated as of July 26, 2000, entitled "Ditech
Communications Completes Acquisition of Atmosphere
Networks --- Acquisition Gives Ditech Key Optical
Networking Systems Expertise"
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(1) Incorporated by reference to the correspondingly numbered exhibit to
Ditech's Annual Report on Form 10-K, File No. 000-26209, for the year ending
April 30, 2000, filed with the Securities and Exchange Commission on July 31,
2000.
1.
