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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
AMENDMENT TO CURRENT REPORT ON FORM 8-K FILED JULY 26, 1999
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
Date of Report (Date of earliest event reported): JULY 12, 1999
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QUIDEL CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Commission file number 0-10961
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DELAWARE 94-2573850
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
10165 MCKELLAR COURT, SAN DIEGO, CA 92121
(Address of Principal Executive Offices)
(858) 552-1100
(Registrant's Telephone Number, Including Area Code)
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
The following financial statements and pro forma financial information are
being provided in connection with Quidel's Current Report on Form 8-K
previously filed with the Securities and Exchange Commission on July 26, 1999.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED
(i) The audited consolidated balance sheets of Metra Biosystems, Inc.
("Metra") as of June 30, 1997 and 1998, the audited consolidated statements
of operations, changes in shareholders' equity and cash flows of Metra for
the three years ended June 30, 1998, the related notes, and the Report of
Ernst & Young LLP, Independent Auditors thereto are set forth in the Metra
Annual Report on Form 10-K for the year ended June 30, 1998 filed with the
Securities and Exchange Commission. Such financial statements, notes and
report are incorporated herein by reference.
(ii) The unaudited consolidated balance sheet of Metra as of March 31,
1999, the unaudited consolidated statements of operations, changes in
shareholders' equity and cash flows of Metra for the nine months then ended
and the related notes thereto are set forth in the Metra Quarterly Report on
Form 10-Q for such period filed with the Securities and Exchange Commission.
Such financial statements and notes are incorporated herein by reference.
(b) PRO FORMA FINANCIAL INFORMATION
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma condensed financial information assumes a
business combination between Quidel and Metra is accounted for as a purchase
and is based on the respective historical consolidated financial statements
and the related notes thereto, which are incorporated in this Current Report
from the Quidel Annual Report on Form 10-K, and derived from the Metra
Quarterly Report on Form 10-Q filed for the periods ended March 31, 1999 and
1998, and the Metra Annual Report on Form 10-K for the year ended June 30,
1998. The pro forma combined condensed balance sheet combines Quidel's March
31,1999 consolidated balance sheet with Metra's March 31, 1999 consolidated
balance sheet. The pro forma statement of operations combines Quidel's and
Metra's historical results for the year ended March 31, 1999.
The pro forma information is presented for illustrative purposes only and is
not necessarily indicative of the operating results or financial position
that would have occurred if the merger of Metra had occurred as of the date
or during the periods presented, nor necessarily indicative of future
operating results or financial positions.
These pro forma financial statements are based on, and should be read in
conjunction with, the historical consolidated financial statements, and the
related notes thereto, of Quidel and Metra incorporated in this Current
Report from their respective Annual and Quarterly Reports on Forms 10-K and
10-Q.
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QUIDEL CORPORATION
UNAUDITED PRO FORMA COMBINED CONDENSED BALANCE SHEET
MARCH 31, 1999
AFTER GIVING EFFECT TO THE MERGER
(in thousands)
<TABLE>
<CAPTION>
Quidel Metra Biosystems, Pro Forma Pro Forma
Corporation Inc. Adjustments Combined
----------- ----------------- ----------- ---------
ASSETS
<S> <C> <C> <C> <C>
Current Assets:
Cash and cash equivalents $ 6,622 $ 3,725 $ (3,725)(A) $ 6,622
Short-term investments -- 10,929 (10,929)(A) --
Accounts receivable, net 8,388 1,500 -- 9,888
Inventory 5,811 1,300 -- 7,111
Other current assets 798 834 -- 1,632
--------- -------- -------- ---------
Total current assets 21,619 18,288 (14,654) 25,253
Property and equipment, net 18,219 2,408 -- 20,627
Long-term investments -- 6,263 (6,263) (A) --
Deferred tax assets 9,083 -- -- 9,083
Intangible assets and other 3,685 696 1,840 (B) 6,221
--------- -------- -------- ---------
$ 52,606 $ 27,655 $(19,077) $ 61,184
--------- -------- -------- ---------
--------- -------- -------- ---------
LIABILITIES AND STOCKHOLDERS'EQUITY
Current Liabilities:
Accounts payable $ 2,283 $ 912 -- $ 3,195
Accrued expenses 2,023 1,918 3,500 (A) 7,441
Deferred contract research revenue 592 -- -- 592
Current portion of long-term debt and
obligations under capital leases 174 822 -- 996
Line of credit -- -- 1,960 (A) 1,960
--------- -------- -------- ---------
Total current liabilities 5,072 3,652 5,460 14,184
Long-term debt and obligations under capital
leases 2,828 286 -- 3,114
Stockholders' Equity:
Preferred stock, $0.001 par value, 5,000 shares
authorized, none issued or outstanding -- -- -- --
Common stock, $0.001 par value, 50,000 shares
authorized, 23,822 and 12,697 shares issued
outstanding, respectively, and 23,822 Pro Forma
outstanding 24 13 (13)(B,D) 24
Additional paid-in capital 116,720 95,329 (95,329)(B,D) 116,720
Accumulated other comprehensive loss -- (536) 536 (B,D) --
Accumulated deficit (72,038) (71,089) 70,269 (B,E) (72,858)
--------- -------- -------- ---------
Total stockholders' equity 44,706 23,717 (24,537) 43,886
--------- -------- -------- ---------
$ 52,606 $ 27,655 $(19,077) $ 61,184
--------- -------- -------- ---------
--------- -------- -------- ---------
</TABLE>
See accompanying notes to unaudited pro forma combined condensed financial
statements.
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QUIDEL CORPORATION
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 1999
AFTER GIVING EFFECT TO THE MERGER
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Quidel Metra Biosystems, Pro Forma Pro Forma
Corporation Inc. Adjustments(E) Combined
----------- ----------------- -------------- ---------
<S> <C> <C> <C> <C>
Revenues:
Net sales $ 47,163 $ 5,795 $ -- $ 52,958
Research contracts, license fees and royalties 4,333 -- -- 4,333
Partner revenues -- 496 -- 496
-------- -------- ------- --------
Total revenues 51,496 6,291 -- 57,787
Costs and Expenses
Cost of sales 26,106 3,011 -- 29,117
Sales and marketing 9,701 5,934 -- 15,635
Research and development 7,942 5,005 -- 12,947
General and administrative 6,115 2,962 368(C) 9,445
Write down and closure of European
subsidiaries 440 -- -- 440
Acquired in-process research and development
costs -- -- -- --
-------- -------- ------- --------
Total costs and expenses 50,304 16,912 368 67,584
-------- -------- ------- --------
Operating income (loss) 1,192 (10,621) (368) (9,797)
Other income, net 202 1,224 (1,530)(F) (104)
-------- -------- ------- --------
Income (loss) before benefit (provision) for
income taxes 1,394 (9,397) (1,898) (9,901)
Benefit for income taxes 6,267 -- -- 6,267
-------- -------- ------- --------
Net income (loss) $ 7,661 $ (9,397) $(1,898) $ (3,634)
-------- -------- ------- --------
-------- -------- ------- --------
Basic and diluted earnings per share $ .32 $ (.74) $ (.15)
-------- -------- --------
-------- -------- --------
Shares used in basic per share calculation 23,782 12,690 23,782
-------- -------- --------
-------- -------- --------
Shares used in diluted per share calculation 23,804 12,690 23,782
-------- -------- --------
-------- -------- --------
</TABLE>
See accompanying notes to unaudited pro forma combined condensed financial
statements.
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NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
1. Basis of Presentation
The unaudited pro forma financial statements of Quidel Corporation have been
prepared based on the historical statements of Quidel and of Metra Biosystems,
Inc. for the year ended March 31, 1999, considering the effects of the
acquisition under the purchase method. The pro forma balance sheet of Quidel at
March 31, 1999 has been prepared as if the merger of Metra had been consummated
at March 31, 1999. The pro forma statement of operations for the year ended
March 31, 1999 has been prepared as if the merger had been consummated on April
1, 1998.
In management's opinion, all material adjustments necessary to reflect the
effects of the acquisition have been made. The unaudited pro forma financial
statements are not necessarily indicative of the actual financial position at
March 31, 1999, or what the actual results of operations of Quidel would have
been assuming the acquisition had been completed as of April 1, 1998, nor are
they indicative of the financial position or results of operations for future
periods. The pro forma financial statements should be read in conjunction with
the historical financial statements and notes thereto of Quidel and Metra.
2. Pro Forma Adjustments and Assumptions
(A) The purchase price for the completion of the Metra acquisition
was determined by combining the purchase price paid for the Metra common
stock (12,852,248 fully diluted shares times $1.78 per share) and the
estimated transactions costs for the acquisition. The estimated direct
transaction costs to be incurred by the Combined Company include sign-on
bonuses, transaction fees for investment bankers, attorneys, accountants,
financial printing and other related charges. The purchase price is
summarized below (in thousands):
<TABLE>
<CAPTION>
<S> <C>
Common stock acquired $ 22,877
Estimated transaction costs 3,500
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$ 26,377
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--------
</TABLE>
The tender offer was financed from cash reserves, proceeds from a
short-term bank loan and proceeds from a revolving line of credit. The
short-term bank loan was repaid with the Metra cash acquired.
(B) Allocation of the purchase price for the completion of the
Metra acquisition was determined as follows (in thousands):
<TABLE>
<CAPTION>
<S> <C>
Acquired in-process technology $ 820
Intangible assets 1,840
Net assets acquired 23,717
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$ 26,377
--------
--------
</TABLE>
(C) Amortization of the intangible assets for Metra will be on the
straight-line method over five years and will be included in depreciation
and amortization expense beginning April 1,1998.
(D) Elimination of Metra stockholders' equity amounts.
(E) The pro forma statement of operations excludes the charge of
$820,000 for purchased in-process technology, which arose from the
acquisition. These charges will be included in the Combined Company's
consolidated financial statements for the six-month period ending
September 30, 1999.
(F) Elimination of Metra interest income on cash and investments
of $1,370,000 and interest expense related to the line of credit of
$160,000.
The purchase price for the Metra acquisition was allocated to the tangible and
intangible assets of Metra based on preliminary estimates of the fair market
value of those assets. The evaluation of the underlying technology acquired
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considered the inherent difficulties and uncertainties in completing the
development, and thereby achieving technological feasibility, and the risks
related to the viability of and potential changes in future target markets that
the acquired technology has any alternative future uses.
(c) EXHIBITS
The following exhibits are filed with this Current Report on Form 8-K:
<TABLE>
<CAPTION>
Exhibit
Number Description
------- ---------------------------------------------------------------
<S> <C>
10.1* Business Loan Agreement, dated as of July 12, 1999, by and
between Bank of America National Trust and Savings Association
and Quidel Corporation
10.2* Security Agreement, dated as of July 12, 1999, by and among
Bank of America National Trust and Savings Association, Quidel
Corporation, MBS Acquisition Corporation, and Pacific Biotech,
Inc.
10.3* Subsidiary Guaranty, dated as of July 12, 1999, by MBS
Acquisition Corporation and Pacific Biotech, Inc.
10.4* Cash Collateral Agreement, dated as of July 12, 1999, by and
between Bank of America National Trust and Savings Association
and Pacific Biotech, Inc.
23.1 Consent of Ernst & Young LLP, Independent Auditors
</TABLE>
* Previously filed with Quidel's Current Report on Form 8-K filed with the
Securities and Exchange Commission on July 26, 1999.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Amendment to Current Report to be signed on its
behalf by the undersigned hereunto duly authorized.
QUIDEL CORPORATION
Date: August 13, 1999 /s/ Charles J.Cashion
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Charles J. Cashion
Senior Vice President,
Corporate Operations,
Chief Financial Officer and
Secretary
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EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement on
Form S-8 (No. 333-72603) pertaining to the Employee Stock Plan of Quidel
Corporation of our report dated July 22, 1998 with respect to the
consolidated financial statements and schedule of Metra Biosystems, Inc. for
the year ended June 30, 1998 incorporated by reference in this Current Report
on Form 8-K/A dated July 12, 1999 of Quidel Corporation.
ERNST & YOUNG LLP
Palo Alto, California
August 12, 1999
