================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
____________
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 28, 1999
CONCURRENT COMPUTER CORPORATION
-------------------------------
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
0-13150
------------
(Commission File Number)
04-2735766
------------------------
(IRS Employer Identification Number)
4375 River Green Parkway, Duluth, Georgia 30097
---------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (678) 258-4000
================================================================================
<PAGE>
ITEM 5. OTHER EVENTS
-------------
On October 28, 1999, Concurrent Computer Corporation ("Concurrent") issued a
press release announcing its acquisition of Vivid Technology, Inc.
On November 1, 1999, Concurrent issued a press release announcing the
appointment of Steven R. Norton as its Executive Vice President and Chief
Financial Officer.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
------------------------------------
(a) Audited Financial statements of Vivid Technology, Inc. for the years
ended December 31, 1998 and 1997.
<PAGE>
VIVID TECHNOLOGY, INC.
----------------------
FINANCIAL STATEMENTS
--------------------
<PAGE>
<TABLE>
<CAPTION>
VIVID TECHNOLOGY, INC.
----------------------
TABLE OF CONTENTS
-----------------
<PAGE>
Page
------
<S> <C>
Independent Auditor's Report. . . . . . . . . . . . . . . 1
Balance Sheets. . . . . . . . . . . . . . . . . . . . . . 2
Statements of Operations. . . . . . . . . . . . . . . . . 3
Statements of Changes in Stockholders' Equity . . . . . . 4
Statements of Cash Flows. . . . . . . . . . . . . . . . . 5
Notes to Financial Statements . . . . . . . . . . . . . . 6 - 11
</TABLE>
<PAGE>
INDEPENDENT AUDITOR'S REPORT
----------------------------
To the Board of Directors and
Stockholders of Vivid Technology, Inc.
We have audited the accompanying balance sheets of Vivid Technology, Inc. (a
Delaware corporation) as of December 31, 1998 and 1997, and the related
statements of operations, changes in stockholders' equity, and cash flows for
the years then ended. These financial statements are the representation of the
company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to in the first paragraph
present fairly, in all material respects, the financial position of Vivid
Technology, Inc. as of December 31, 1998 and 1997, and the results of its
operations and its cash flows for the years then ended in conformity with
generally accepted accounting principles.
/S/ BERGEY YODER SWEENEY WITTER & ROLAND PC
_____________________________________________________
BERGEY YODER SWEENEY WITTER & ROLAND PC
Certified Public Accountants
November 26, 1999
- 1 -
<PAGE>
<TABLE>
<CAPTION>
VIVID TECHNOLOGY, INC.
----------------------
BALANCE SHEETS
--------------
ASSETS
------
December 31,
----------------------
1998 1997
------------ --------
<S> <C> <C>
Current Assets:
Cash and Cash Equivalents. . . . . . . . . . . . . . . . . $ 1,002,043 $ 34,285
Accounts Receivable. . . . . . . . . . . . . . . . . . . . 85,804 166,232
Prepaid Expenses and Other Assets. . . . . . . . . . . . . 27,515 -- .
------------ --------
Total Current Assets. . . . . . . . . . . . . . . . . . 1,115,362 200,517
Property and Equipment, Net. . . . . . . . . . . . . . . . . 149,931 52,385
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . 12,500 -- .
------------ --------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . $ 1,277,793 $252,902
============ ========
LIABILITIES
- ------------------------------------------------------------
Current Liabilities:
Amount Due to Stockholder. . . . . . . . . . . . . . . . . $ 71,564 $ --
Accounts Payable and Accrued Expenses. . . . . . . . . . . 96,209 22,459
------------ --------
Total Current Liabilities . . . . . . . . . . . . . . . 167,773 22,459
------------ --------
STOCKHOLDERS' EQUITY
- ------------------------------------------------------------
Stockholders' Equity:
Convertible Preferred Stock, Par Value $.001; 199,387
Shares Authorized and Outstanding at December 31, 1998. $ 199 $ --
Common Stock, Par Value $.001; 5,000,000 Shares
Authorized; 600,000 Issued and Outstanding. . . . . . . 600 600
Additional Paid in Capital . . . . . . . . . . . . . . . . 1,301,204 1,400
Retained Earnings (Deficit). . . . . . . . . . . . . . . . (191,983) 228,443
------------ --------
Total Stockholders' Equity (Deficit). . . . . . . . . . 1,110,020 230,443
------------ --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY . . . . . . . . . $ 1,277,793 $252,902
============ ========
</TABLE>
See accountant's report and the accompanying notes.
- 2 -
<PAGE>
<TABLE>
<CAPTION>
VIVID TECHNOLOGY, INC.
----------------------
STATEMENTS OF OPERATIONS
------------------------
Year Ended December 31,
----------------------------
1998 1997
------------- -------------
<S> <C> <C>
Sales. . . . . . . . . . . . . . . . . $ 812,461 $ 659,915
Cost of Sales. . . . . . . . . . . . . 347,579 127,851
------------- -------------
Gross Profit . . . . . . . . . . . . . 464,882 532,064
Operating Expenses:
Selling, General and Administrative. 179,452 24,518
Research and Development . . . . . . 619,603 265,362
------------- -------------
Total Operating Expenses. . . . . 799,055 289,880
------------- -------------
Operating Income (Loss). . . . . . . . (334,173) 242,184
Other Income and (Expenses). . . . . . 20,816 (1,468)
------------- -------------
Net Income (Loss). . . . . . . . . . . $ (313,357) $ 240,716
============= =============
</TABLE>
See accountant's report and the accompanying notes.
- 3 -
<PAGE>
<TABLE>
<CAPTION>
VIVID TECHNOLOGY, INC.
----------------------
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
---------------------------------------------
Additional Retained
Preferred Stock Common Stock Paid In Earnings
Shares Par Value Shares Par Value Capital (Deficit) Total
--------- ---------- ------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at
December 31, 1996
(Unaudited). . . . . -- $ -- 300,000 $ 300 $ 700 $ (5,766) $ (4,766)
Issuance of
Common Stock . . . -- -- 300,000 300 700 -- 1,000
Dividends Paid. . . . -- -- -- -- -- (6,507) (6,507)
Net Income. . . . . . -- -- -- -- -- 240,716 240,716
--------- ---------- ------- ---------- ---------- ---------- -----------
Balance at
December 31, 1997. -- -- 600,000 600 1,400 228,443 230,443
Sale of Preferred
Stock. . . . . . . 199,387 199 -- -- 1,299,804 -- 1,300,003
Dividends Paid. . . . -- -- -- -- -- (107,069) (107,069)
Net (Loss). . . . . . -- -- -- -- -- (313,357) (313,357)
--------- ---------- ------- ---------- ---------- ---------- -----------
Balance at
December 31, 1998. 199,387 $ 199 600,000 $ 600 $1,301,204 $(191,983) $1,110,020
========= ========== ======= ========== ========== ========== ===========
</TABLE>
See accountant's report and the accompanying notes.
- 4 -
<PAGE>
<TABLE>
<CAPTION>
VIVID TECHNOLOGY, INC.
----------------------
STATEMENTS OF CASH FLOWS
------------------------
Year Ended December 31,
---------------------------
1998 1997
------------ -------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income (Loss). . . . . . . . . . . . . . . . $ (313,357) $ 240,716
Adjustments to Reconcile Net Income (Loss)
to Net Cash Provided by (Used in)
Operating Activities:
Depreciation . . . . . . . . . . . . . . 23,065 6,096
(Increase) Decrease in Assets:
Accounts Receivable. . . . . . . . . . 80,428 (156,135)
Inventory. . . . . . . . . . . . . . . (2,695) --
Accrued Interest . . . . . . . . . . . (16,437) --
Prepaid Expenses . . . . . . . . . . . (8,383) --
Deposits . . . . . . . . . . . . . . . (12,500) --
Increase (Decrease) in Liabilities:
Accounts Payable and Accrued Expenses. 69,743 11,626
Other Current Liabilities. . . . . . . 4,007 --
------------ -------------
Net Cash Provided by (Used in)
Operating Activities. . . . . . . . . . . . . (176,129) 102,303
------------ -------------
Cash Flows from Investing Activities:
Purchases of Property and Equipment. . . . . . . (120,611) (54,754)
------------ -------------
Cash Flows from Financing Activities:
Net Proceeds (Payments) on Stockholder Loan. . . 71,564 (7,941)
Proceeds from Issuance of Common Stock . . . . . -- 1,000
Proceeds from Issuance of Preferred Stock. . . . 1,300,003 --
Proceeds from Issuance of Convertible Debt . . . -- --
Cash Dividends Paid. . . . . . . . . . . . . . . (107,069) (6,507)
------------ -------------
Net Cash Provided by (Used in) Financing
Activities . . . . . . . . . . . . . . . . . 1,264,498 (13,448)
------------ -------------
Net Increase (Decrease) in Cash. . . . . . . . . . 967,758 34,101
Cash and Cash Equivalents, Beginning . . . . . . . 34,285 184
------------ -------------
Cash and Cash Equivalents, Ending. . . . . . . . . $ 1,002,043 $ 34,285
============ =============
Supplemental Disclosure of Cash Flow Information:
Cash Payments for Interest . . . . . . . . . . . $ 20 $ 1,468
============ =============
</TABLE>
See accountant's report and the accompanying notes.
- 5 -
<PAGE>
VIVID TECHNOLOGY, INC.
----------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE 1 - OVERVIEW OF THE BUSINESS:
- ----------------------------------------
The company, which is located in Southeastern Pennsylvania, provides Video
on Demand and interactive television solutions. Video on Demand is a
system of hardware and software elements that enables cable operators to offer
subscribers an information and entertainment medium including movies, on-line
shopping, news, sports and classifieds through the use of a television set. The
system can also provide for the management of subscriber accounts, billing
systems and library content.
Sales of the video on demand solution to date have been solely for the
customers to evaluate the viability of the video on demand market and the
proposed architecture prior to making a long-term investment in the unproven
technology.
Revenue has also resulted from sales of the completed interactive
television solution and customer consultations.
The company contracts with customers located throughout North America,
performs ongoing credit evaluations of its customers' financial condition and
generally requires no collateral from its customers.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
- ----------------------------------------------------------
The summary of significant accounting policies of Vivid Technology, Inc. is
presented to assist in understanding the company's financial statements. The
financial statements and notes are representations of the company's management,
who is responsible for their integrity and objectivity. These accounting
policies conform to generally accepted accounting principles and have been
consistently applied in the preparation of the financial statements.
USE OF ESTIMATES:
------------------
Management of the company has made a number of estimates and assumptions
relating to the reporting of assets and liabilities at the balance sheet dates
and the reporting of revenues and expenses during the reporting periods, to
prepare these financial statements in conformity with generally accepted
accounting principles. Actual results could differ from those estimates.
REVENUE AND COST RECOGNITION:
-------------------------------
Computer systems sales are recorded when the earnings process is complete,
typically upon shipment to customers.
CASH AND CASH EQUIVALENTS:
-----------------------------
Short term investments with original maturities of ninety days or less at
the date of purchase are considered cash equivalents.
INVENTORY:
---------
Inventory is stated at the lower of cost or market. Cost is determined on
the first-in, first-out basis.
- 6 -
<PAGE>
NOTES TO FINANCIAL STATEMENTS - CONTINUED:
- ----------------------------------------------
PROPERTY AND EQUIPMENT:
------------------------
Property and equipment are recorded at cost. Significant additions and
betterments are capitalized while maintenance and repairs are expensed as
incurred. The cost of property and equipment is depreciated over the estimated
useful lives of the related assets using the straight line method.
Gains and losses resulting from the disposition of property and equipment
are included in other income and (expenses).
RESEARCH AND DEVELOPMENT:
--------------------------
Research and development expenditures are expensed as incurred.
INCOME TAX STATUS:
-------------------
The company elected to be an S corporation for both federal and state
corporate tax purposes effective September 26, 1996, its date of incorporation.
In lieu of corporation income taxes, the company's income flowed directly to its
then sole stockholder and was taxed at the individual level. Accordingly, no
provision or liability for corporate income taxes was included in the financial
statements during the time of its S corporation status. The company revoked its
S elections effective July 31, 1998, thereby becoming subject to federal and
state income taxes at the corporate level. Temporary differences between
financial and income tax reporting are minor; accordingly, no deferred tax
accounts have been recorded.
FAIR VALUE OF FINANCIAL INSTRUMENTS:
----------------------------------------
The carrying amounts of cash and cash equivalents, accounts receivable,
prepaid expenses, and other assets, accounts payable, accrued expenses and short
term debt approximate fair value because of the short maturity of these
instruments.
NOTE 3 - PROPERTY AND EQUIPMENT:
- ------------------------------------
The following is a summary of property and equipment at December 31, 1998
and 1997:
<TABLE>
<CAPTION>
<S> <C> <C>
1998 1997
------------ ------------
Lab Equipment . . . . . . . . $ 140,678 $ 47,682
Office Equipment. . . . . . . 24,855 5,609
Office Furniture. . . . . . . 13,973 5,604
------------ ------------
179,506 58,895
Less Accumulated Depreciation ( 29,575) ( 6,510)
------------ ------------
$ 149,931 $ 52,385
============ ============
</TABLE>
Total depreciation expense was $23,065 in 1998 and $6,096 in 1997.
- 7 -
<PAGE>
NOTES TO FINANCIAL STATEMENTS - CONTINUED:
- ----------------------------------------------
NOTE 4 - AMOUNTS DUE TO STOCKHOLDER:
- ------------------------------------------
At December 31, 1998, the company owed its sole common stockholder $71,564,
which was due on demand, non-interest-bearing, and unsecured. At the time of
the merger described in Note 12, the remaining balance was forgiven.
NOTE 5 - STOCKHOLDERS' EQUITY:
- ----------------------------------
The company was originally capitalized during 1996 with authorized common
stock of 1,000,000 shares at a par value of $.01 per share. As of December 31,
1996, the sole stockholder held 100,000 shares, acquired at par value. During
1997, an additional 100,000 shares were issued at par value.
During 1998 the company effected a three-for-one stock dividend and amended
its original capitalization to enable the issuance of two classes of stock,
common and convertible preferred. The amount of authorized shares of common
stock was increased from 1,000,000 to 5,000,000, while the par value was reduced
from $.01 per share to $.001. All common share and per common share amounts
have been adjusted for all periods to reflect the re-capitalization. Total
authorized shares of the new class of convertible preferred stock, entitled
"Series A Preferred Stock", was 199,387 shares, a par value of $.001 per share,
and a provision which called for an annual dividend of $.61 per share. Shares
of the preferred stock were convertible at any time into an equal number of
common shares.
During 1998, the company issued 199,387 shares of preferred stock at $6.52
per share. The stock was convertible at the option of the holder into common
shares on a one-to-one basis, which was done in connection with the merger
described in Note 12.
NOTE 6 - OFFICER'S SALARY AND DIVIDENDS:
- ---------------------------------------------
During 1997 the president and then sole stockholder of the company agreed
to defer his salary because of cash flow considerations. The amount of salary
being deferred was not specified, and there was no accrual for the expense
established at December 31, 1997.
During June 1998 the value of the forgone 1997 salary was set at $90,000,
which was paid to the stockholder as a dividend. Accordingly, 1997 results do
not include any expense for officer's salary.
NOTE 7 - OPERATING LEASE COMMITMENTS:
- -----------------------------------------
The company leases its facility under a 37 month operating lease which
expires November 30, 2001. The lease provides for monthly lease payments of
$6,917 with annual increases thereto. This payment includes common area
maintenance and taxes. The lease also allows for options to extend the term for
an additional 24 months and to renew for an additional three years beyond that
with annual increases in the monthly lease payment.
- 8 -
<PAGE>
NOTES TO FINANCIAL STATEMENT - CONTINUED:
- ----------------------------------------------
The minimum annual rentals required under this non-cancelable lease as of
December 31, 1998 are as follows:
Year Ending
December 31,
- ------------
1999 $ 83,199
2000 85,544
2001 80,432
--------
$249,175
========
Rent expense was $23,331 for 1998 and $22,750 for 1997.
NOTE 8 - RETIREMENT PLAN:
- ----------------------------
The company adopted a Salary Reduction Simplified Employee Pension
Plan effective December 15, 1996. The plan covers all employees who have
completed 1 month of service during the immediately preceding 5 plan years.
Employees may defer a maximum of 15% of their wages up to the indexed limit.
The company matches deferrals up to 5%. Total retirement plan expense was
$7,673 for 1998 and $0 for 1997
NOTE 9 - MAJOR CUSTOMERS:
- ----------------------------
Net sales include sales to the following major customers, each of which
accounted for 10% or more of the total net sales of the company for the year.
<TABLE>
<CAPTION>
December 31, 1998 December 31, 1997
---------------------------------- -----------------------------
Amount Accounts Amount Accounts
Customer Of Sales % Receivable Of Sales % Receivable
- -------- --------- --------- ------------ --------- ----- -----------
<S> <C> <C> <C> <C> <C> <C>
A. . . . $ 333,000 40.8 $ -- $ -- -- $ --
B. . . . 273,880 33.5 -- -- -- --
C. . . . -- -- -- 202,895 29.9 46,200
D. . . . -- -- -- 159,437 23.5 48,886
E. . . . -- . -- . -- . 80,644 11.9 -- .
--------- --------- ------------ --------- ----- -----------
$ 606,880 74.3 $ -- . $ 442,976 65.3 $ 95,086
========= ========= ============ ========= ===== ===========
</TABLE>
NOTE 10 - INCOME TAXES:
- --------------------------
The Company has a net operating loss carryforward of $229,415 available
under provisions of the Internal Revenue Code to be applied against future
federal taxable income. This carryforward expires December 31, 2018. The
income tax benefit of this carryforward of approximately $100,000 has been fully
reserved since it is not probable that the benefit will be realized in the
foreseeable future.
The Company also has a net operating loss carryforward of $229,415
available to be applied against future Pennsylvania taxable income. This
carryforward expires December 31, 2008.
- 9 -
<PAGE>
NOTES TO FINANCIAL STATEMENT - CONTINUED:
- ---------------------------------------------
NOTE 11 - STOCK BASED COMPENSATION PLANS:
- -----------------------------------------------
The company has an equity compensation plan under which it can issue
incentive stock options, nonqualified stock options, and restricted stock to
designated employees, non-employee members of its board of directors, and key
advisors. Through December 31, 1998, only nonqualified stock options had been
issued under the plan.
The options are granted at prices determined by the company's board of
directors and are to be not less than the market value of the stock on the date
of grant. The options vest over a four year period. The options did not result
in compensation cost to the company.
A summary of the status of the options follows:
<TABLE>
<CAPTION>
Shares .
-----------------------------------------
Year Ended December 31,
-----------------------
1998 1997
------- ---------
<S> <C> <C>
Outstanding, beginning 93,000 --
Granted. . . . . . . . 20,500 93,000
Exercised. . . . . . . -- --
Expired. . . . . . . . -- --
Forfeited. . . . . . . -- . -- .
------- ---------
Outstanding, ending. . 113,500 93,000
======= =========
</TABLE>
All of the options issued through December 31, 1998 had an exercise price
of $1 per share. As of December 31, 1998 and 1997, vested shares totaled 36,250
and 0, respectively; exercisable options totaled 35,730 and 0, respectively.
NOTE 12 - SUBSEQUENT EVENTS:
- --------------------------------
CONVERTIBLE DEBT:
------------------
On September 8, 1999, the company borrowed $500,000 and issued a
convertible promissory note which gave the holder the right to convert the note
into shares of the company's preferred stock. The note was originally due
September 1, 2000, along with accrued interest of 10%.
The number of shares into which the note could be converted was based on a
percentage of the original proceeds plus a percentage based on length of time
the debt was outstanding. The conversion feature was exercisable upon various
events, one of which was the merger of the company. Pursuant to the merger
described below, the debt was converted, resulting in the holder receiving
34,610 shares of the company's preferred stock, which was in turn converted into
an equal number of common shares.
- 10 -
<PAGE>
NOTES TO FINANCIAL STATEMENTS - CONCLUDED:
- ----------------------------------------------
MERGER:
-------
The company entered into an agreement and plan of merger with Concurrent
Computer Corporation ("Concurrent") as of October 28, 1999. The combination was
structured to constitute a tax-free reorganization under applicable provisions
of the Internal Revenue Code.
Immediately prior to the merger on October 28, 1999, the holder of the
convertible debt converted the note into 34,610 shares of preferred stock. All
of the then outstanding 233,997 shares of preferred stock were exchanged for an
equal number of shares of common stock. The shareholder then converted 100% of
their share of Vivid into 2,233,689 shares of Concurrent Computer Corporation
common stock. The company's outstanding and unexercised stock options were
immediately vested and exchanged for options to purchase 376,301 shares of
Concurrent common stock.
- 11 -
<PAGE>
(b) Pro Forma Financial Information
<PAGE>
Item 7(b). Pro Forma Financial Statements
The following unaudited pro forma condensed consolidated financial statements of
Concurrent Computer Corporation (CCC) and Vivid Technology, Inc. (Vivid) are
dervied from, and should be read in conjunction with the audited financial
statements of Vivid filed herein and the audited financial statements of CCC as
previously filed on Form 10-K and unaudited interim financial statements of CCC
as previously filed on Form 10-Q with the Securities and Exchange Commission.
The pro forma condensed consolidated financial statements do not purport to be
indicative of the results of operations or financial position which would have
actually been reported had the acquisition been consummated on the dates
indicated, or which may be reported in the future.
The valuation of the assets acquired from Vivid Technology, Inc. is preliminary
and subject to adjustment resulting from additional subsequent evidence, if any,
and finalization of the independent appraisal report.
The pro forma balance sheet reflects preliminary adjustments as if the
acquisition had been consummated on that date, September 30, 1999. The pro
forma statements of operations reflects preliminary adjustments as if the
acquisition had been consummated at the beginning of the period presented.
BALANCE SHEET
(a) To reflect the acquisition by merger of all the outstanding stock of
Vivid and the preliminary allocation of the purchase price on the basis of the
estimated fair values of the net assets acquired assuming a September 30, 1999
purchase date. The components of the purchase price and its preliminary
allocation to the assets and liabilities are as follows:
<TABLE>
<CAPTION>
<S> <C>
Stock (2,233,689 shares) . . . . . . . . . . . . . . . . . . $16,753,000
Shares reserved for issuance upon exercise of stock options
(378,983 shares). . . . . . . . . . . . . . . . . . . . . 2,792,000
Other costs of acquisition . . . . . . . . . . . . . . . . . 250,000
------------
Total purchase price. . . . . . . . . . . . . . . . . . . $19,795,000
============
Preliminary allocation of purchase price
Purchased in-process computer software technology. . . . . 14,000,000
Fully developed computer software technology . . . . . . . 1,900,000
Current assets . . . . . . . . . . . . . . . . . . . . . . 373,000
Furniture and fixtures . . . . . . . . . . . . . . . . . . 239,000
Other assets . . . . . . . . . . . . . . . . . . . . . . . 400,000
Current liabilities. . . . . . . . . . . . . . . . . . . . (128,000)
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . 3,011,000
------------
Total purchase price. . . . . . . . . . . . . . . . . . $19,795,000
============
</TABLE>
The actual purchase price paid at closing October 28, 1999 was $20.0 million
resulting in goodwill of $3,155,000.
STATEMENTS OF OPERATIONS:
(b) To expense the cost of purchased in-process computer software technology
in accordance with generally accepted accounting principles.
(c) To record the amortization of capitalized developed computer software
technology, goodwill and other minor intangible assets.
No income tax benefit was recognized on the write-off of the purchased
in-process computer software technology because the merger was structured as tax
free to the selling shareholders and the write-off of this asset and the
amortization of the other intangible assets will not be deductible for federal
income tax purposes.
<PAGE>
<TABLE>
<CAPTION>
Concurrent Computer Corporation
Pro Forma Consolidated Statement of Operations
For the Year Ended June 30, 1999
Historical
---------------------------------
Concurrent
Concurrent Computer
Computer Vivid Pro Forma Corporaton
Corporation Technology, Inc. Adjustments Pro Forma
------------- ------------------ ----------- -------------
<S> <C> <C> <C> <C> <C>
Revenues:
Computer systems . . . . . . . . . . . $ 31,597,000 $ 639,933 $ 32,236,933
Service and other. . . . . . . . . . . 38,366,000 - 38,366,000
------------- ------------------ -------------
Total . . . . . . . . . . . . . . . . . . 69,963,000 639,933 70,602,933
Cost of sales:
Computer systems . . . . . . . . . . . 15,001,000 309,277 15,310,277
Service and other. . . . . . . . . . . 19,625,000 - 19,625,000
------------- ------------------ -------------
Total . . . . . . . . . . . . . . . . . . 34,626,000 309,277 34,935,277
------------- ------------------ -------------
Gross margin. . . . . . . . . . . . . . . 35,337,000 330,656 35,667,656
Operating expenses:
Selling, general and administrative. . 26,157,000 658,729 26,815,729
Research and development . . . . . . . 10,046,000 893,479 10,939,479
Purchased in-process computer -
software technology . . . . . . . . - - ( b ) 14,000,000 14,000,000
Amortization . . . . . . . . . . . . . - - ( c ) 624,000 624,000
Loss on facility held for sale . . . . 423,000 - 423,000
------------- ------------------ -------------
Total operating expenses. . . . . . . . . 36,626,000 1,552,208 52,802,208
------------- ------------------ -------------
Operating income (loss) . . . . . . . . . (1,289,000) (1,221,552) (17,134,552)
Interest and other income (expense), net. (13,000) 13,394 394
------------- ------------------ -------------
Income (loss) before income taxes . . . . (1,302,000) (1,208,158) (17,134,158)
Income taxes. . . . . . . . . . . . . . . 363,000 - 363,000
------------- ------------------ -------------
Net income (loss) . . . . . . . . . . . . $ (1,665,000) $ (1,208,158) $(17,497,158)
============= ================== =============
Income (loss) Per Share (1):
Basic and diluted. . . . . . . . . . . $ (0.03) $ (0.35)
============= =============
Weighted average number of common shares
used in calculating income (loss) per
share of common stock (1):
Basic and diluted. . . . . . . . . . . 47,967,000 50,201,000
============= =============
<FN>
(1) Pro forma diluted earnings (loss) per share excludes the effect of outstanding stock options because the
effect is antidilutive.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Concurrent Computer Corporation
Pro Forma Consolidated Statement of Operations
For the Quarter Ended September 30, 1999
Historical
---------------------------------
Concurrent
Concurrent Computer
Computer Vivid Pro Forma Corporaton
Corporation Technology, Inc. Adjustments Pro Forma
------------- ------------------ ----------- -------------
<S> <C> <C> <C> <C> <C>
Revenues:
Computer systems . . . . . . . . . . . $ 7,604,000 $ 253,615 $ 7,857,615
Service and other. . . . . . . . . . . 8,080,000 - 8,080,000
------------- ------------------ -------------
Total . . . . . . . . . . . . . . . . . . 15,684,000 253,615 15,937,615
Cost of sales:
Computer systems . . . . . . . . . . . 3,790,000 119,539 3,909,539
Service and other. . . . . . . . . . . 4,254,000 - 4,254,000
------------- ------------------ -------------
Total . . . . . . . . . . . . . . . . . . 8,044,000 119,539 8,163,539
------------- ------------------ -------------
Gross margin. . . . . . . . . . . . . . . 7,640,000 134,076 7,774,076
Operating expenses:
Selling, general and administrative. . 6,156,000 153,453 6,309,453
Research and development . . . . . . . 2,222,000 304,539 2,526,539
Purchased in-process computer -
software technology . . . . . . . . - - ( b ) 14,000,000 14,000,000
Amortization . . . . . . . . . . . . . - - ( c ) 156,000 156,000
Relocation and restructuring . . . . . 2,367,000 - 2,367,000
------------- ------------------ -------------
Total operating expenses. . . . . . . . . 10,745,000 457,992 25,358,992
------------- ------------------ -------------
Operating income (loss) . . . . . . . . . (3,105,000) (323,916) (17,584,916)
Interest and other income (expense), net. 704,000 23 704,023
------------- ------------------ -------------
Income (loss) before income taxes . . . . (2,401,000) (323,893) (16,880,893)
Income taxes. . . . . . . . . . . . . . . 150,000 - 150,000
------------- ------------------ -------------
Net income (loss) . . . . . . . . . . . . $ (2,551,000) $ (323,893) $(17,030,893)
============= ================== =============
Income (loss) Per Share (1):
Basic and diluted. . . . . . . . . . . $ (0.05) $ (0.33)
============= =============
Weighted average number of common shares
used in calculating income (loss) per
share of common stock (1):
Basic and diluted. . . . . . . . . . . 48,965,000 51,199,000
============= =============
<FN>
(1) Pro forma diluted earnings (loss) per share excludes the effect of outstanding stock
options because the effect is antidilutive.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Concurrent Computer Corporation
Pro Forma Consolidated Statement of Operations
September 30, 1999
Historical
---------------------------------
Concurrent
Concurrent Computer
Computer Vivid Pro Forma Corporaton
Corporation Technology, Inc. Adjustments Pro Forma
------------- ------------------ ------------ -------------
<S> <C> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents . . . . . . . . . . . $ 4,812,000 $ 357,488 $ 5,169,488
Trade accounts receivable, net. . . . . . . . . 16,786,000 9,030 16,795,030
Inventory . . . . . . . . . . . . . . . . . . . 5,015,000 5,580 5,020,580
Prepaid expenses and other current assets . . . 1,354,000 1,144 1,355,144
------------- ------------------ -------------
Total current assets . . . . . . . . . . . . 27,967,000 373,242 28,340,242
Property, plant and equipment, net. . . . . . . 11,269,000 238,717 11,507,717
Purchased developed computer software . . . . . - - ( a ) 1,900,000 1,900,000
Cost of in-process computer software technology - - ( a ) 14,000,000 -
( a ) (14,000,000)
Goodwill. . . . . . . . . . . . . . . . . . . . - - ( a ) 3,011,000 3,011,000
Other long-term assets. . . . . . . . . . . . . 1,084,000 - ( a ) 400,000 1,484,000
------------- ------------------ -------------
Total Assets. . . . . . . . . . . . . . . . . . . $ 40,320,000 $ 611,959 $ 46,242,959
============= ================== =============
LIABILITIES
Note payable. . . . . . . . . . . . . . . . . . - 500,000 ( a ) (500,000) -
Amount due to shareholder . . . . . . . . . . . - 26,490 ( a ) (26,490) -
Accounts payable and accrued expenses . . . . . 10,353,000 84,957 ( a ) 250,000 10,687,957
Deferred revenue. . . . . . . . . . . . . . . . 2,788,000 - 2,788,000
Other current liabilities . . . . . . . . . . . - 43,155 43,155
------------- ------------------ -------------
Total current liabilities. . . . . . . . . . 13,141,000 654,602 13,519,112
Long-term liabilities . . . . . . . . . . . . . 1,885,000 - 1,885,000
STOCKHOLDERS' EQUITY
Common stock. . . . . . . . . . . . . . . . . . 492,000 600 ( a ) (600) 514,337
( a ) 22,337
Preferred stock . . . . . . . . . . . . . . . . - 199 ( a ) (199) -
Additional Paid-in Capital. . . . . . . . . . . 100,331,000 1,301,204 ( a ) (1,301,204) 119,853,510
( a ) 19,522,510
Treasury stock. . . . . . . . . . . . . . . . . (58,000) (58,000)
Retained earnings . . . . . . . . . . . . . . . (75,407,000) (1,344,646) ( a ) 1,344,646 (89,407,000)
( a ) (14,000,000)
Accumulated translation adjustment. . . . . . . (64,000) - (64,000)
------------- ------------------ -------------
Total stockholders' equity . . . . . . . . . 25,294,000 (42,643) 30,838,847
------------- ------------------ -------------
Total liabilities and stockholders' equity. . . . $ 40,320,000 $ 611,959 $ 46,242,959
============= ================== =============
</TABLE>
<PAGE>
(c) Exhibits: See Exhibit Index.
Exhibit No.
- ------------
23.1 Independent Auditors Consent
99.1 Press release dated October 28, 1999
99.2 Press release dated November 1, 1999
<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 thereunto duly authorized.
Date: January 11, 2000
Concurrent Computer Corporation
By: /s/ Steven R. Norton
-----------------------
Steven R. Norton
Executive Vice President and
Chief Financial Officer
<PAGE>
EXHIBIT INDEX
-------------
23.1 Independent Auditors Consent
99.1 Press release dated October 28, 1999
99.2 Press release dated November 1, 1999
<PAGE>
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the inclusion in the Current Report on Form 8-K under the
Securities Exchange Act of 1934 of Concurrent Computer Corporation dated January
10, 2000 of our reports dated November 26, 1999 insofar as such reports relate
to the financial statements of Vivid Technology, Inc. for the years ended
December 31, 1998 and 1997.
/S/ Bergey, Yoder, Sweeney, Witter & Roland, P.C.
Telford, PA
January 7, 2000
<PAGE>
EXHIBIT 99.1
For More Information Contact:
- --------------------------------
Concurrent Computer Corporation Concurrent Computer Corporation
Andrea Ariza (Media) Beth Alonzo (Analysts/Investors)
(678) 258-4070 or [email protected] (954) 973-5100
FOR IMMEDIATE RELEASE
CONCURRENT COMPUTER CORPORATION ACQUIRES VIDEO SERVER COMPETITOR,
VIVID TECHNOLOGY
- - INTEGRATION OF CONCURRENT AND VIVID'S TECHNOLOGY GIVES CONCURRENT BROADEST
PRODUCT SUITE IN EMERGING VOD MARKETPLACE
- - ACQUISITION EXPECTED TO BE ACCRETIVE IN FIRST FULL YEAR OF COMBINED
OPERATION
Atlanta, Georgia, October 28, 1999 -- Concurrent Computer Corporation
(NASDAQ:CCUR) announced today the acquisition of rival Video-On-Demand (VOD)
provider, Vivid Technology. Concurrent is one of the leading providers of
digital video server hardware and software for VOD applications. Vivid
Technology, based outside of Philadelphia, provides complete end-to-end VOD and
interactive television solutions. The two companies believe that Concurrent's
acquisition of Vivid strategically positions Concurrent as the leading video
server provider by allowing it to offer customers the broadest VOD product
offering including compatibility with both the Scientific-Atlanta and the
General Instrument digital platforms. No competitor can currently boast active
site installations of both Scientific-Atlanta and General Instrument platforms.
In the merger, each share of outstanding Vivid capital stock was exchanged for
2.67831 shares of Concurrent common stock. In aggregate, Concurrent issued a
total of 2,233,700 shares to the current stockholders of Vivid and has reserved
376,300 shares for issuance upon the exercise of assumed Vivid stock options.
VOD enables cable operators to offer subscribers an information and
Entertainment medium that provides individual freedom, control, choice,
flexibility, convenience, and simplicity through the use of a television set.
The most exciting benefit of VOD technology is that it brings movies -
more-
<PAGE>
Concurrent/Vivid
October 28, 1999
Page 2
on-demand into the subscribers' homes with full VCR-type control, such as pause,
rewind, fastforward, etc. For subscribers, VOD will equate to having the video
rental store right in their home -- minus the late fees, selection limitations,
and poor video quality. Many have already labeled VOD as the "killer app." Today
cable companies have deployed 4 million digital set-top boxes in subscriber
homes, with the majority of these boxes provided by General Instrument and
Scientific-Atlanta. As the digital revolution continues, by the year 2004 the
number of digital set-top boxes deployed is expected to increase seven-fold.
Both Concurrent and Vivid are recognized technical leaders in VOD technology
providing VOD and interactive applications to the cable industry. Each company
has developed unique advantages that will now be available to their combined
customers, providing the combined operations with greater depth to meet a
broader range of application needs.
The Vivid and Concurrent video servers use industrial PC server hardware. Both
solutions offer a fully integrated system including Video Streaming, Interactive
Application Support VOD Set-top Management, and Purchase Tracking with billing
system interface. Vivid's VOD System has been integrated with General
Instrument's DCT1000 and DCT2000 set-top boxes. Concurrent's VOD system has
been integrated with Scientific-Atlanta's Explorer 2000 set-top box and head-end
equipment. Concurrent is also working with content providers such as TVN,
Viewer's Choice, and Intertainer. Concurrent's BackOffice Software Suite,
co-developed with PRASARA Technologies, has been optimized to meet the
operational and management requirements of cable operators. Concurrent is also
working with several conditional access providers, such as Nagravision and NDS,
in addition to the aforementioned set-top box manufacturers. The combined
technologies of Concurrent and Vivid coupled with their existing partners
provide Concurrent with the broadest product offering in the marketplace.
Fred Allegrezza, Founder and President of Vivid Technology, stated, "As a result
of all the consolidation in the cable industry, it makes sense for us to merge
our GI digital video server solution with the company that offers the best SA
digital video server solution. Concurrent's technology provides the most viable,
robust SA-compatible solution; and thus we feel that Concurrent is the right
company to leverage the Vivid technology."
-more-
<PAGE>
Concurrent/Vivid
October 28, 1999
Page 3
Robert Clasen, former President of Comcast Cable and Chairman of the Board of
Vivid Technology added, "Based on my experience in the CATV industry and my
early involvement with Vivid, I am a firm believer that VOD is the most exciting
application yet for digital customers. Combining the Vivid and Concurrent
technologies gives Concurrent a tremendous advantage over other VOD vendors.
With this deal, we expect to win the Time-to-Market race."
E. Courtney Siegel, Chairman, President and Chief Executive Officer of
Concurrent Computer Corporation commented, "With Vivid's lead in the GI
marketplace, this acquisition made perfect sense. For Concurrent, this deal
will broaden our product suite and customer base and be accretive almost
immediately."
Vivid Technology (http://www.vividtech.com) will be integrated into the Xstreme
------------------------
Division of Concurrent Computer Corporation, headed by Steve Nussrallah,
President of Concurrent's Xstreme Division. Fred Allegrezza, President of Vivid
Technology, will continue on with Concurrent reporting directly to Nussrallah.
The Vivid facilities in Chalfont, Pennsylvania will become a new Concurrent
office.
Steve Nussrallah, President Xstreme Division, added, "I am pleased to welcome
Vivid to the Concurrent team. This deal will enable Concurrent to offer a VOD
solution to every cable operator - no matter what its platform requirements
are." He added, "Vivid brings other assets to the deal such as its integrated
QAM technology, its network management, its Pennsylvania facility, and the
talent that resides there."
The Principals of Vivid have over twenty years experience in communications
technologies, including interactive digital cable networks. Their extensive
backgrounds include Product Management, System Design, Software and Hardware
Design, Product Development, System Integration, and System Deployment.
ABOUT CONCURRENT
Concurrent Computer Corporation (http://www.ccur.com), headquartered in Atlanta,
-------------------
Georgia, is
a leading provider of high-performance computer systems, software, and servers.
Concurrent Computer Corporation's Xstreme Division is a leading supplier in the
emerging digital video
-more-
<PAGE>
Concurrent/Vivid
October 28, 1999
Page 4
server marketplace. This market includes the broadband/cable, corporate
training, education, hospitality, and in-flight entertainment industries.
Operating in 32 countries worldwide, Concurrent provides sales and support from
offices throughout North America, South America, Europe, Asia, and Australia.
Certain matters discussed in this news release may be "forward-looking
statements" as defined in the Private Securities Litigation Reform Act of 1995.
Concurrent Computer Corporation cautions investors that any forward-looking
statements made herein are not guarantees of future performance and that a
variety of factors could cause its actual results and experience to differ
materially from the anticipated results or other expectations expressed in such
forward-looking statements. The risks and uncertainties that could affect
Concurrent Computer Corporation's performance or results include, without
limitation, changes in product demand; economic conditions; various inventory
risks due to changes in market conditions; uncertainties relating to the
development and ownership of intellectual property; uncertainties relating to
the ability of Concurrent Computer Corporation and other companies to enforce
their intellectual property rights; the pricing and availability of equipment,
materials, and inventories; technological developments; delays in testing of new
products; rapid technology changes; the highly competitive environment in which
Concurrent Computer Corporation operates; the entry of new well-capitalized
competitors into Concurrent Computer Corporation's markets; and other risks and
uncertainties.
# # #
Note to Editors: For additional company or product information from Concurrent
Computer Corporation, please contact Concurrent Computer Corporation, 4375
RiverGreen Parkway, Duluth, Georgia 30096. Call toll free in the U.S. and Canada
at (877) 978-7363 or (678) 258-4000, or fax (678) 258-4300. Readers can also
access information through the company's web site at http://www.ccur.com.
-------------------
Concurrent Computer Corporation is a registered trademark and MediaHawk is a
trademark of Concurrent Computer Corporation. All other products are trademarks
or registered trademarks of their respective owners.
<PAGE>
EXHIBIT 99.2
For More Information Contact:
- --------------------------------
Concurrent Computer Corporation Concurrent Computer Corporation
Andrea Ariza (Media) Beth Alonzo (Analysts/Investors)
(678) 258-4070 or [email protected] (954) 973-5100
FOR IMMEDIATE RELEASE
STEVEN R. NORTON NAMED CHIEF FINANCIAL OFFICER OF
CONCURRENT COMPUTER CORPORATION
Atlanta, Georgia, November 1, 1999 -- Concurrent Computer Corporation
(NASDAQ:CCUR) announced today that Steven R. Norton has joined the company as
Executive Vice President and Chief Financial Officer. Prior to joining
Concurrent Computer Corporation, Mr. Norton served for over 3 years as the Vice
President of Finance and Administration for LHS Group Inc. and the Chief
Financial Officer for LHS Communications Systems, Inc. In this role, one of his
many responsibilities, together with the Chief Financial Officer of LHS Group
Inc., was the initial public offering of common stock of LHS Group Inc. which
was completed in May 1997 and subsequent regulatory filings required by the
Securities and Exchange Commission. Prior to his employment at LHS, Mr. Norton
was an Audit Senior Manager for Ernst & Young LLP for 8 years in Grand Rapids,
Michigan and Frankfurt, Germany and at KPMG Peat Marwick in Atlanta, Georgia for
5 years.
E. Courtney Siegel, Chairman of the Board, President and Chief Executive Officer
of Concurrent Computer Corporation said, "We are delighted to have Steve on
board. His international, operational, and financial experience with a publicly
held company in a high-tech growth industry similar to ours are qualities that
we believe will provide significant benefit to Concurrent."
Concurrent Computer Corporation (HTTP://WWW.CCUR.COM), headquartered in Atlanta,
-------------------
Georgia, is a leading provider of high-performance computer systems, software,
and servers. Concurrent
-more-
<PAGE>
Concurrent/CFO
November 1, 1999
Page 2
Computer Corporation's Xstreme Division is a leading supplier in the emerging
digital video server marketplace. This market includes the broadband/cable,
corporate training, education, hospitality, and in-flight entertainment
industries. Concurrent is also a leading provider of high-performance, real-time
computer systems, solutions, and software for commercial and government markets.
The company's 30-year old real-time business focuses on strategic market areas
that include: hardware-in-the-loop and man-in-the-loop simulation; data
acquisition; industrial systems; and software and embedded applications.
Operating in 32 countries worldwide, Concurrent provides sales and support from
offices throughout North America, South America, Europe, Asia, and Australia.
# # #
Note to Editors: For additional company or product information from Concurrent
Computer Corporation, please contact Concurrent Computer Corporation, 4375 River
Green Parkway, Duluth, Georgia 30096. Call toll free in the U.S. and Canada at
(877) 978-7363 or (678) 258-4000, or fax (678) 258-4300. Readers can also access
information through the company's web site at http://www.ccur.com.
-------------------
Concurrent Computer Corporation is a registered trademark of Concurrent Computer
Corporation. All other products are trademarks or registered trademarks of their
respective owners.
<PAGE>
