SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
Form 8-K/A
AMENDMENT TO APPLICATION OR REPORT
Filed pursuant to Section 12, 13, or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
BIOMET, INC.
(Exact name of registrant as specified in charter)
AMENDMENT NO. 1
The undersigned registrant hereby amends the following items,
financial statements, exhibits or other portions of its Current
Report dated November 18, 1994, on Form 8-K as set forth in the
pages attached hereto:
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
(a) Financial statements of business acquired:
(1) The following documents filed with the Commission by Kirschner
Medical Corporation ("Kirschner") (File No. 0-14053) pursuant to the
Exchange Act are incorporated by reference in this Form 8-K/A:
(i) The Annual Report of Kirschner on Form 10-K for the year ended
December 31, 1993 and
(ii) The Quarterly Reports of Kirschner on Form 10-Q for the quarters
ended March 31 and June 30, 1994.
(2) The following information is included with this report.
(i) Unaudited financial statements of Kirschner as of September
30, 1994 and for the nine months ended September 30, 1994
and 1993.
(b) Pro forma financial information:
(1) The following information filed with the Commission by Biomet, Inc.
("Biomet") on September 28, 1994, is incorporated by reference herein
from the Form S-4 Registation Statement No. 33-55483:
(i) Pro Forma Condensed Consolidated Financial Statements of
Biomet, Inc:
- Pro Forma Condensed Consolidated Balance Sheet as of
May 31, 1994;
- Pro Forma Condensed Consolidated Statement of Income for
the year ended May 31, 1994; and
- Notes to Pro Forma Condensed Consolidated Financial Statements.
(2) The following information is included with this report:
(i) Pro Forma Condensed Consolidated Financial Statements of
Biomet, Inc.:
- Pro Forma Condensed Consolidated Balance Sheet as of
August 31, 1994;
- Pro Forma Condensed Consolidated Statement of Income for
the three months ended August 31, 1994; and
- Notes to Pro Forma Condensed Consolidated Financial Statements.
(c) Exhibits.
(1) See Index of Exhibits.
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this amendment to be signed
on its behalf by the undersigned, thereunto duly authorized.
BIOMET, INC.
By: /s/ Gregory D. Hartman
-----------------------
Gregory D. Hartman,
Vice President, Finance
Date: January 13, 1995
----------------
KIRSCHNER MEDICAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
September 30,
1994
(UNAUDITED)
ASSETS
Current assets:
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 632
Accounts receivable. . . . . . . . . . . . . . . . . . . . 18,866
Inventories. . . . . . . . . . . . . . . . . . . . . . . . 19,052
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . 755
-------
Total current assets. . . . . . . . . . . . . . . . . . 39,305
-------
Property, plant and equipment:
Property, plant and equipment, at cost . . . . . . . . . . 18,741
Less accumulated depreciation and amortization . . . . . . (10,227)
------
Property, plant and equipment, net. . . . . . . . . . . 8,514
------
Intangible assets, net . . . . . . . . . . . . . . . . . . 6,717
Other assets . . . . . . . . . . . . . . . . . . . . . . . 837
------
Total assets. . . . . . . . . . . . . . . . . . . . . . $ 55,373
======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt. . . . . . . . . . . . . . . . . . . . . . $ 2,327
Current portion of long-term debt. . . . . . . . . . . . . 4,074
Current portion of capital lease obligations . . . . . . . 224
Accounts payable . . . . . . . . . . . . . . . . . . . . . 3,246
Accrued commissions. . . . . . . . . . . . . . . . . . . . 2,234
Biomet earnest money deposit . . . . . . . . . . . . . . . 2,000
Accrued liabilities. . . . . . . . . . . . . . . . . . . . 4,956
Income taxes payable, including deferred income
taxes of $745 in 1994. . . . . . . . . . . . . . . . . . 1,018
------
Total current liabilities . . . . . . . . . . . . . . . 20,079
Long-term liabilities:
Long-term debt . . . . . . . . . . . . . . . . . . . . . . 8,058
Capital lease obligations. . . . . . . . . . . . . . . . . 1,166
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Deferred income taxes. . . . . . . . . . . . . . . . . . . 284
------
Total liabilities 29,601
------
Shareholders' equity:
Preferred stock, no par value; authorized
200,000 shares; none issued. . . . . . . . . . . . . . . -
Common stock, $.10 par value; authorized
10,000,000 shares; issued and outstanding 3,607,730
shares at September 30, 1994 . . . . . . . . . . . . . . 361
Additional paid-in capital . . . . . . . . . . . . . . . . 38,362
Less: unearned compensation . . . . . . . . . . . . . . . (1,035)
Cumulative foreign currency translation adjustments. . . . (483)
Accumulated deficit. . . . . . . . . . . . . . . . . . . . (11,433)
------
Total shareholders' equity. . . . . . . . . . . . . . . 25,772
------
Total liabilities and shareholders' equity. . . . . . . $ 55,373
======
KIRSCHNER MEDICAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(in thousands, except per share data)
Nine months ended September 30,
1994 1993
---- ----
Revenues . . . . . . . . . . . . . . . . $49,440 $55,060
Cost of sales. . . . . . . . . . . . . . 20,884 23,992
------ ------
Gross profit . . . . . . . . . . . . . . 28,556 31,068
------ ------
Operating expenses:
Selling. . . . . . . . . . . . . . . . . 16,532 18,149
Administrative . . . . . . . . . . . . . 7,718 7,025
Research and development . . . . . . . . 1,190 1,703
------ ------
Total operating expenses. . . . . . . 25,440 26,877
------ ------
Operating profit . . . . . . . . . . . . 3,116 4,191
Net interest expense and other . . . . . 1,535 2,690
------ ------
Income from continuing operations
before income tax provision and
extraordinary item . . . . . . . . . . 1,581 1,501
Provision for income taxes . . . . . . . 501 348
------ ------
Income from continuing operations
before extraordinary item. . . . . . . 1,080 1,153
Loss from discontinued operations. . . (157) --
------ ------
Income before extraordinary item . . . . 923 1,153
Extraordinary item . . . . . . . . . . . - 2,395
------ ------
Net income . . . . . . . . . . . . . . . $ 923 $ 3,548
====== ======
Earnings per share:
Income from continuing operations. . . . $ .30 $ .34
Income before extraordinary item . . . . $ .26 $ .34
Net income . . . . . . . . . . . . . . . $ .26 $ 1.05
Weighted average common and common
equivalent shares outstanding. . . . . 3,591 3,383
KIRSCHNER MEDICAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
Nine months ended September 30,
1994 1993
---- ----
Cash flows from operating activities:
Net income . . . . . . . . . . . . . . . . . . . . $ 923 $3,548
Adjustments to reconcile net income
to net cash provided by operating
activities:
Loss from discontinued operations. . . . . . . 157 --
Depreciation . . . . . . . . . . . . . . . . . 1,167 1,214
Amortization . . . . . . . . . . . . . . . . . 468 443
Provision for deferred income taxes. . . . . . -- (79)
Extraordinary gain on extinguishment of debt . -- (2,730)
Loss on sale of assets . . . . . . . . . . . . 10 9
Changes in certain assets and liabilities:
Accounts receivable. . . . . . . . . . . . . 404 (362)
Inventories. . . . . . . . . . . . . . . . . 99 3,789
Prepaid expenses and other assets. . . . . . (129) (81)
Accounts payable and accrued liabilities . . 154 (1,293)
Income taxes payable . . . . . . . . . . . . 153 110
Net cash used for operating activities of
discontinued operations. . . . . . . . . . . (304) --
----- -----
Net cash provided by operating activities. . . . 3,102 4,568
----- -----
Cash flows from investing activities:
Net proceeds from sale of discontinued operations. 1,937 --
Capital expenditures . . . . . . . . . . . . . . . (907) (620)
Proceeds from sale of property and equipment . . . 81 --
Other. . . . . . . . . . . . . . . . . . . . . . . (28) 66
----- -----
Net cash provided by (used in) investing
activities . . . . . . . . . . . . . . . . . . 1,083 (554)
----- -----
Cash flows from financing activities:
Net repayments of short-term debt. . . . . . . . . (813) (3,054)
Net repayments under revolving credit facilities . (3,459) (535)
Proceeds from new revolving credit facility. . . . 5,159 --
Repayment of previous revolving credit facility. . (3,023) --
Proceeds from long-term debt . . . . . . . . . . . 5,216 2,214
Repayment of long-term debt. . . . . . . . . . . . (9,420) (2,618)
Principal payments under capital lease obligations (273) (293)
Earnest money deposit payable. . . . . . . . . . . 2,000 --
proceeds from issuance on common stock . . . . . . -- 385
----- -----
Net cash used for financing activities . . . . . (4,613) (3,901)
----- -----
Net effect of exchange rate changes on cash. . . . 55 (12)
----- -----
Net increase (decrease) in cash. . . . . . . . . . (373) 101
Cash at beginning of period. . . . . . . . . . . . 1,005 990
----- -----
Cash at end of period. . . . . . . . . . . . . . . $ 632 $ 1,091
===== =====
BIOMET, INC.
PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited pro forma condensed consolidated financial
statements (the "Pro Forma Statements"), are required by the rules of the
Securities and Exchange Commission and are provided for comparative purposes
only. The Pro Forma Statements should not necessarily be considered indicative
of the results which would have been or will be achieved since they are based
on historical rather than prospective information and include certain
assumptions which are subject to change.
The Pro Forma Statements illustrate the effect of the transactions between
Biomet and Kirschner, and are based on historical financial statements of
Biomet as of and for the three-month period ended August 31, 1994 and on
historical financial statements of Kirschner as of and for the three-month
period ended June 30, 1994. These statements reflect how Biomet's consolidated
balance sheet might have appeared if the transactions had occurred on August
31, 1994 and how Biomet's consolidated statement of income might have appeared
if the transactions had occurred at the beginning of the three-month period
ended August 31, 1994. Biomet will account for the acquisition of Kirschner
using the purchase method.
The Pro Forma Statements are unaudited and should be read in conjunction
with the accompanying notes thereto and with Biomet's and Kirschner's
historical financial statements and related notes. The pro forma purchase
adjustments are based on assumptions and estimates made specifically for the
purpose of preparing these Pro Forma Statements. The final purchase
adjustments to the accounts of Kirschner may vary, based upon changes in
estimated values resulting from final reports of independent appraisals and
other factors impacting the net assets of Kirschner. In the opinion of
Biomet's management, these Pro Forma Statements are reasonable under the
circumstances.
BIOMET, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
as of August 31, 1994
(in thousands)
Historical Pro-Forma
------------------ -----------------------
Biomet Kirschner Adjustment Consolidated
------ -------- ---------- ------------
ASSETS
Current assets: (5)$(16,454)
Cash and cash equivalents $ 70,113 $ 1,459 (6) (14,434) $ 40,684
Short-term investments 82,630 -- -- 82,630
Accounts and notes receivable, net 95,863 18,261 -- 114,124
Inventories 96,176 18,159 -- 114,335
(1) 6,400
Prepaid expenses and other 15,481 767 (3) 570 23,218
-------- ------- ------- --------
Total current assets 360,263 38,646 (23,918) 374,991
Property, plant and equipment, net 51,304 8,682 -- 59,986
(5) 32,700
(7) (2,500)
Investment in and
advance to Kirschner 8,700 -- (8)(38,900) --
Investment in and
advances to affiliates 1,138 -- -- 1,138
Other assets 1,965 2,029 -- 3,994
Intangible assets, net 9,161 583 -- 9,744
Excess acquisition costs over fair (2) (6,256)
value of acquired net assets 11,160 6,256 (4) 13,102 24,262
-------- -------- -------- --------
Total assets $443,691 $ 56,196 $(25,772) $474,115
======== ======== ======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings $ 1,350 $ 1,928 (6)$(1,928) $ 1,350
(6) (1,582)
Long-term debt, current -- 4,082 (7) (2,500) --
Capital leases, current -- 214 (6) (214) --
Accounts payable 17,199 3,938 -- 21,137
Accrued income tax 19,449 1,086 -- 20,535
Other accrued expenses 21,547 7,359 (3) 1,500 30,406
-------- ------- -------- --------
Total current liabilities 59,545 18,607 (4,724) 73,428
Long-term debt and capital leases -- 10,710 (6)(10,710) --
Other liabilities 6,930 295 -- 7,225
-------- ------- -------- --------
Total liabilities 66,475 29,612 (15,434) 80,653
Shareholders' equity: (5) 16,246
Common shares 47,506 361 (8) (361) 63,752
Additional paid-in-capital 13,606 38,362 (8)(38,362) 13,606
Retained earnings (deficit) 316,623 (11,469) (8) 11,469 316,623
Unrealized gain on certain
equity securities 2,300 -- -- 2,300
Cumulative translation adjustment (2,819) (670) (8) 670 (2,819)
-------- ------- -------- --------
Total shareholders' equity 377,216 26,584 (10,338) 393,462
-------- ------- -------- --------
Total liabilities and
shareholders' equity $443,691 $56,196 $(25,772) $474,115
======== ======= ======== ========
The accompanying notes are part of the pro forma condensed consolidated
financial statements.
BIOMET, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME (Unaudited)
for the three months ended August 31, 1994
(in thousands, except per share amounts)
Historical Pro-Forma
------------------ ------------------------
Biomet Kirschner Adjustments Consolidated
------ --------- ----------- ------------
Net sales $ 96,226 $ 17,162 $ -- $113,388
Cost of sales 29,805 7,210 -- 37,015
-------- -------- ------- --------
Gross profit 66,421 9,952 -- 76,373
Selling, general and (11) (46)
administrative expenses 35,166 8,488 (12) 218 43,826
Research and development expense 5,215 395 -- 5,610
-------- -------- ------- --------
Operating income 26,040 1,069 (172) 26,937
Other income (expense), net 1,578 (100) (9) (424) 1,054
Interest expense (187) (643) (10) 643 (187)
-------- -------- ------- --------
Income from continuing operations
before income taxes 27,431 326 47 27,807
Provision for income taxes 10,318 153 (13) 83 10,554
-------- -------- ------- --------
Income from continuing operations $ 17,113 $ 173 $ (36) $ 17,250
======== ======== ======= ========
Earnings per share
from continuing operations $ .15 $ .05 $ .15
===== ===== =====
Weighted average shares 114,377 3,463 115,761
======= ===== =======
The accompanying notes are part of the pro forma condensed consolidated
financial statements.
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For purposes of the pro forma condensed consolidated balance sheet, it is
assumed that the acquisition by Biomet of Kirschner occurred on August 31,
1994. For purposes of the pro forma condensed consolidated statement of
income, it is assumed that the acquisition by Biomet of Kirschner occurred at
the beginning of the three-month period ended August 31, 1994. Both pro forma
condensed financial statements reflect, on a pro forma basis, Biomet's
ownership of 100% of the issued and outstanding common shares of Kirschner.
Kirschner's amounts are as of and for the three-month period ended June 30,
1994, as amounts as of and for the period ended August 31, 1994 are not
practicable to determine.
(Amounts in thousands)
Cost of acquisition:
Purchase price of 2,922,508 shares
representing 81% of Kirschner's
issued and outstanding common shares $ 32,492
Purchase price of 685,222 shares from
Figgie International Inc. ("Figgie") on
August 12, 1994, representing 19% of
Kirschner's issued and outstanding
common shares 6,200
Estimated acquisition costs 208
--------
$ 38,900
========
Net assets acquired:
Kirschner's shareholders' equity as of
June 30, 1994 $ 26,584
Fair value adjustments to reflect
increase (decrease) in book value:
(1) Deferred taxes 6,400
(2) Kirschner's excess acquisition cost
over estimated fair value of acquired
net assets ("Goodwill") (6,256)
(3) Accrued liabilities, net of deferred
tax benefit (930)
(4) Goodwill 13,102
--------
$ 38,900
========
(1) Adjustment to Kirschner's deferred tax valuation allowance.
(2) Write-off of Kirschner's Goodwill which has no continuing
value to Biomet.
(3) Record liabilities incurred in the transaction but not reflected on
Kirschner's consolidated balance sheet (for example, contingencies
that are probable and subject to reasonable estimation), net of
related tax benefit.
(4) Record Goodwill in Biomet's acquisition of Kirschner.
(5) Adjustment to record Biomet's purchase for cash of 40.5% of
Kirschner's issued and outstanding shares, the exchange of 40.5% of
Kirschner's issued and outstanding common shares for Biomet Common
Shares and the payment of estimated costs.
(6) Reflect the repayment of Kirschner's short-term borrowings and
long-term debt.
(7) Elimination of intercompany note receivable and payable.
(8) Elimination of Biomet's investment in Kirschner and the related
shareholders' equity.
(9) Decrease investment income as a result of the reduction of cash and
cash investments used for the acquisition and the payoff of debt.
(10) Elimination of interest expense relating to the payoff of debt.
(11) Elimination of amortization expense relating to Kirschner's Goodwill
written off at acquisition date.
(12) Amortization of Goodwill using the straight-line method over a 15
year period.
(13) Income tax effect of adjustments (9) and (10), assuming an effective
tax rate of 38%.
BIOMET, INC.
FORM 8-K
INDEX TO EXHIBITS
Exhibit Number Page Number in
Assigned in Sequential
Regulation S-K Numbering
Item 601 Description of Exhibit System
______________ ______________________ ______________
(1) No Exhibit.
(2) 2.01 Agreement and Plan of Merger by and
among Biomet, Inc., Biomet Acquisition
Corp. and Kirschner Medical Corporation.
(Incorporated by reference to Exhibit 2
to Schedule 13D filed August 20, 1994, by
Biomet, Inc. and Kirschner Acquisition
Corporation with respect to the Common
Stock, $0.01 par value, of Kirschner,
CUSIP No. 497660100.)
2.02 First Amendment to Agreement and Plan of
Merger by and among Biomet, Inc., Biomet
Acquisition Corp., Kirschner Acquisition
Corp. and Kirschner Medical Corporation.
(Incorporated by reference to Exhibit 2.02
to Biomet's Amendment No. 1 to Form S-4,
Registration No. 33-55483.)
(4) No Exhibit.
(16) No Exhibit.
(17) No Exhibit.
(20) No Exhibit.
(23) No Exhibit.
(24) No Exhibit.
(27) No Exhibit.
