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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
AND EXCHANGE ACT OF 1934
Commission File Number 0-29811
Date of Report: December 21, 2000
NEW FOCUS, INC.
(Registrant)
Incorporated in the State of Delaware
I.R.S. Employer Identification Number 33-0404910
2630 Walsh Avenue, Santa Clara, California 95051
Telephone: (408) 980-8088
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ITEM 5: OTHER EVENTS
The Company issued the following press release on December 21, 2000:
NEW FOCUS AND JCA TECHNOLOGY AMEND MERGER AGREEMENT AND EXPECT TO
CLOSE MERGER IN JANUARY
SANTA CLARA, Calif., Dec. 21 -- New Focus, Inc. (Nasdaq: NUFO - news), a leading
supplier of innovative fiber optic products for next-generation optical networks
under the Smart Optics for Networks(TM) brand, today announced that the company
has amended its previously announced merger agreement with JCA Technology, Inc.
in light of recent stock market conditions. The parties now expect to close the
transaction in January 2001, subject to the satisfaction of customary closing
conditions. The merger is structured as a tax-free exchange for JCA's
shareholders and a purchase transaction for accounting purposes.
New Focus and JCA have agreed on two principal revisions to the original merger
agreement. The first revision modifies the transaction consideration to a fixed
10,033,556 shares of New Focus common stock and $75 million in cash. Based on
the $26.375 closing price of New Focus shares today, the total implied value of
the transaction is approximately $340 million. The original transaction
consideration was composed of $575 million of New Focus common stock and $25
million in cash with the number of New Focus common shares determined by the
average price of the company's common stock for a ten-trading day period prior
to the closing of the transaction. The number of shares was subject to a collar
that restricted the number of shares to no fewer than 5,016,778 shares and no
more than 10,033,556 shares. The second revision eliminates JCA's right to
terminate the original merger agreement under certain conditions if such
ten-trading day average price of New Focus shares dropped below $53.21 per
share.
After completion of the transaction, JCA shareholders will own approximately
13.5% of the combined company based on this newly fixed merger consideration.
Excluding shares to be issued in pending acquisitions, New Focus had 64.4
million shares outstanding as of December 20, 2000.
"The management teams at New Focus and JCA are extremely pleased that we could
reach agreement on revised merger terms given the extremely difficult conditions
in the financial markets. This agreement removes uncertainty for both companies
and reflects the recent change in valuations for fiber optic companies. Both
sides have worked together closely during the past two months on a range of
issues and feel even more excited about the potential synergies in the
combination of New Focus and JCA. Both companies are generating considerable
revenue momentum for their respective product offerings and New Focus is showing
stronger-than-expected improvement in its margin performance. As a result, the
near-term financial results of the combined entity should be attractive to the
investment community," said Ken Westrick, president and chief executive officer
of New Focus, Inc.
"The combination of JCA and New Focus has great long-term potential. From a
technology standpoint New Focus brings expertise in optics and high-speed
opto-electronics, while JCA brings expertise in microwave electronics and
packaging to the combined company. Through the combination of New Focus and JCA
we have a unique opportunity to apply the complementary skill sets of our two
companies to develop innovative opto-electronic components that will address the
future requirements of the fiber optics industry," said James Chao, president
and chief executive officer of JCA Technology, Inc.
New Focus reported a pro forma net loss of $14.8 million on $46.5 million in
revenue for the first nine months of 2000. Based on unaudited results, JCA
operated profitably during the first nine months of 2000 on revenues of
approximately $13.9 million. JCA's gross and operating margin percentages are
already higher than New Focus' actual third quarter margins and targeted margins
for 2001. As a result, the JCA transaction will be immediately accretive to the
revenue and margin lines, measured on a pro forma per share basis excluding
acquisition-related charges such as goodwill and compensation expenses, in the
first full quarter of combined operations.
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Credit Suisse First Boston acted as financial advisor to New Focus in this
transaction and CIBC World Markets acted as financial advisor to JCA.
Forward-Looking Statements:
This press release contains predictions, estimates and other forward-looking
statements which include, but are not limited to, statements regarding the
likelihood and timing of the closing, the future financial performance of JCA
and New Focus, the synergistic effects of the proposed combination in terms of
product development, and the accretive nature of the transaction on the combined
financial results in future periods. These statements are subject to risks and
uncertainties and actual results may differ materially from any future
performance suggested above. In particular, risks and uncertainties associated
with the near term financial performance of JCA and New Focus include the
ability to adapt and qualify product designs that fit specific customer
requirements and the ability to scale the manufacturing operations and corporate
infrastructure to accommodate the higher projected revenue levels. To realize
the synergistic effects related to next-generation products, New Focus and JCA
must integrate the efforts of various design and development teams at different
sites and there is no assurance that such integration will be completed
successfully. Risk factors that may affect New Focus' financial performance are
listed in the company's S-1 registration statement for its follow-on public
offering on file with the SEC. New Focus and JCA undertake no obligation to
publicly release any revisions to these forward-looking statements, which may be
made to reflect events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.
About JCA Technology:
JCA Technology, a privately held company, designs, manufactures and markets a
full line of fiber optic products for OC-48 and OC-192 modulators, including
high-speed clock amplifiers and broadband data driver amplifiers. Founded in
1985, the company developed a leadership position in state-of-the-art, thin-film
hybrid microwave amplifiers, switches, and subassemblies for the defense,
wireless and satellite communications markets. Leveraging its technology and
manufacturing capabilities, the company entered the fiber optic market in 1999.
The company employs approximately 215 people at its 42,000 square foot
headquarters and manufacturing facility in Camarillo, California.
About New Focus:
New Focus designs, manufactures and markets innovative fiber optic products for
next-generation optical networks. The company's Smart Optics for Networks(TM)
products enhance the performance of next-generation optical networks by enabling
higher channel counts, faster data rates, longer reach lengths, new service
capabilities, and lower costs of ownership. Founded in 1990, the company remains
a leader in the creation of advanced optical products for the commercial and
research marketplaces. The company is headquartered in Santa Clara, California
and has operations in San Jose, California, Madison, Wisconsin, and Shenzhen,
People's Republic of China that employ nearly 1,500 people.
For more information about New Focus visit the company's Internet home page at
http://www.newfocus.com, call our Investors Relations Department at
408-919-2700, or e-mail us at [email protected].
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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, in the City of Santa Clara, State of
California, on December 22, 2000.
NEW FOCUS, INC.
(Registrant)
DATE: December 22, 2000 BY: /s/ William L. Potts, Jr.
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William L. Potts, Jr.
Senior Vice President
and Chief Financial
Officer
