As filed with the Securities and Exchange Commission on September 30, 1999.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report: September 24, 1999
(Date of earliest event reported)
S3 INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware 0-21126 77-0204341
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
2841 Mission College Boulevard, Santa Clara, CA 95054
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (408) 588-8000
Not applicable
(Former name or former address, if changed since last report)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On September 24, 1999, S3 Incorporated, a Delaware corporation (the
"Company" or "Registrant"), completed its merger with Diamond Multimedia
Systems, Inc., a Delaware corporation ("Diamond"), pursuant to the Agreement and
Plan of Merger, dated as of June 21, 1999 (the "Merger Agreement"), as amended,
by and among the Company, Diamond and Denmark Acquisition Sub, Inc., a Delaware
corporation ("Denmark"). Following consummation of the merger, Diamond became a
wholly-owned subsidiary of the Company.
Pursuant to the Merger Agreement, Denmark, the Company's wholly-owned
subsidiary, was merged with and into Diamond and each share of Diamond common
stock was converted into the right to receive 0.52 shares of the Company's
common stock. No fractional shares of the Company's common stock will be issued
and in lieu thereof former Diamond stockholders otherwise entitled to a
fractional share will receive a cash payment equal to such fraction of a share
multiplied by $9.5625, the closing price of the Company's common stock on the
Nasdaq National Market on the effective date of the merger.
In addition, pursuant to the Merger Agreement, each option and right to
acquire Diamond common stock granted under Diamond's stock-based incentive plans
outstanding immediately prior to the effective time of the merger was converted
into an option to purchase Company common stock and the Company assumed each
such option or right in accordance with the terms of the Diamond stock-based
incentive plan by which it is evidenced. By virtue of the assumption by the
Company of such Diamond options and rights, from and after the effective time of
the merger: (i) each Diamond option or right to acquire common stock assumed by
the Company may be exercised solely for Company common stock; (ii) the number of
shares of Company common stock subject to such Diamond option or right is equal
to the number of Diamond shares subject to the option or right immediately prior
to the effective time of the merger multiplied by 0.52 (the exchange ratio in
the merger), rounded down to the nearest whole number of shares of Company
common stock; and (iii) the per share exercise price for each such option or
right is equal to the quotient obtained by dividing the exercise price per share
of such option or right immediately prior to the effective time of the merger by
0.52, rounded up to the nearest whole cent.
The foregoing descriptions of the Merger Agreement are qualified in
their entirety to the full text of the Merger Agreement, a copy of which is
attached hereto as an exhibit and which is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of Businesses Acquired.
The balance sheets of Diamond at December 31, 1998 and 1997 and the
statements of operations, stockholders' equity and cash flows of Diamond for
each of the three years in the three-year period ended December 31, 1998,
including the report of independent auditors thereon, included in Diamond's
Annual Report on Form 10-K/A Amendment No. 2 for the year ended December 31,
1998 are incorporated herein by reference.
The unaudited balance sheet of Diamond at June 30, 1999 and the
statements of operations and cash flows of Diamond for the six months ended June
30, 1999 and 1998 included in Diamond's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1999 are incorporated herein by reference.
(b) Pro Forma Financial Information.
The Unaudited Pro Forma Combined Condensed Financial Information,
including the Statements of Operations for the Year Ended December 31, 1998 and
the Six Months Ended June 30, 1999, the Balance Sheet as of June 30, 1999, and
Notes 1, 2 and 3 thereto, set forth on pages 78-85 of the Joint Proxy
Statement/Prospectus, dated August 16, 1999, that forms a part of the
Registrant's Registration Statement on Form S-4 filed August 16, 1999 (File No.
333-85323) are incorporated herein by reference.
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<PAGE>
(c) Exhibits.
2.1 Agreement and Plan of Merger, dated as of June 21, 1999, by and between
the Registrant and Diamond (incorporated by reference to Appendix A to
the Joint Proxy Statement/Prospectus, dated August 16, 1999, that forms
a part of the Registrant's Registration Statement on Form S-4 filed
August 16, 1999 (File No. 333-85323).
2.2 Amendment No. 1 to Agreement and Plan of Merger, dated as of
September 15, 1999, by and among the Registrant, Diamond and Denmark
Acquisition Sub, Inc., a Delaware corporation and wholly owned
subsidiary of the Registrant.
23.1 Consent of PricewaterhouseCoopers LLP, Independent Auditors.
99.1 The balance sheets of Diamond at December 31, 1998 and 1997 and the
statements of operations, stockholders' equity and cash flows of
Diamond for each of the three years in the three-year period ended
December 31, 1998, including the report of independent auditors thereon
(incorporated by reference to Diamond Multimedia Systems, Inc. Annual
Report on Form 10-K/A Amendment No. 2 for the year ended December 31,
1998).
99.2 The unaudited balance sheet of Diamond at June 30, 1999 and the
statements of operations and cash flows of Diamond for the six months
ended June 30, 1999 and 1998 (incorporated by reference to Diamond
Multimedia Systems, Inc. Quarterly Report on Form 10-Q for the quarter
ended June 30, 1999).
99.3 The Unaudited Pro Forma Combined Condensed Financial Information,
including the Statements of Operations for the Year Ended December 31,
1998 and the Six Months Ended June 30, 1999, the Balance Sheet as of
June 30, 1999, and Notes 1, 2 and 3 thereto (incorporated by reference
to pages 78-85 of the Joint Proxy Statement/Prospectus, dated August
16, 1999, that forms a part of the Registrant's Registration Statement
on Form S-4 filed August 16, 1999 (File No. 333-85323)).
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<PAGE>
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, in the City of Santa Clara, State of
California, on September 30, 1999.
S3 INCORPORATED
By /S/ WALTER D. AMARAL
-------------------------------------
Walter D. Amaral
Senior Vice President and
Chief Financial Officer
-3-
<PAGE>
INDEX TO EXHIBITS
-----------------
2.1 Agreement and Plan of Merger, dated as of June 21, 1999, by and between
the Registrant and Diamond (incorporated by reference to Appendix A to
the Joint Proxy Statement/Prospectus, dated August 16, 1999, that forms
a part of the Registrant's Registration Statement on Form S-4 filed
August 16, 1999 (File No. 333-85323).
2.2 Amendment No. 1 to Agreement and Plan of Merger, dated as of
September 15, 1999, by and among the Registrant, Diamond and Denmark
Acquisition Sub, Inc., a Delaware corporation and wholly owned
subsidiary of the Registrant.
23.1 Consent of PricewaterhouseCoopers LLP, Independent Auditors.
99.1 The balance sheets of Diamond at December 31, 1998 and 1997 and the
statements of operations, stockholders' equity and cash flows of
Diamond for each of the three years in the three-year period ended
December 31, 1998, including the report of independent auditors thereon
(incorporated by reference to Diamond Multimedia Systems, Inc. Annual
Report on Form 10-K/A Amendment No. 2 for the year ended December 31,
1998).
99.2 The unaudited balance sheet of Diamond at June 30, 1999 and the
statements of operations and cash flows of Diamond for the six months
ended June 30, 1999 and 1998 (incorporated by reference to Diamond
Multimedia Systems, Inc. Quarterly Report on Form 10-Q for the quarter
ended June 30, 1999).
99.3 The Unaudited Pro Forma Combined Condensed Financial Information,
including the Statements of Operations for the Year Ended December 31,
1998 and the Six Months Ended June 30, 1999, the Balance Sheet as of
June 30, 1999, and Notes 1, 2 and 3 thereto (incorporated by reference
to pages 78-85 of the Joint Proxy Statement/Prospectus, dated August
16, 1999, that forms a part of the Registrant's Registration Statement
on Form S-4 filed August 16, 1999 (File No. 333-85323)).
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<PAGE>
EXHIBIT 2.2
AMENDMENT NO. 1
TO
AGREEMENT AND PLAN OF MERGER
BETWEEEN
DIAMOND MULTIMEDIA SYSTEMS, INC.
AND S3 INCORPORATED
AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER, dated as of September
15, 1999 (this "Amendment"), by and among DIAMOND MULTIMEDIA SYSTEMS, INC., a
Delaware corporation (the "Company"), S3 INCORPORATED, a Delaware corporation
(the "Acquiror"), and DENMARK ACQUISITION SUB, INC., a Delaware corporation (the
"Merger Subsidiary").
RECITALS
WHEREAS, the Company and Acquiror are parties to the Agreement and Plan
of Merger, dated June 21, 1999 (the "Merger Agreement");
WHEREAS, pursuant to the terms of the Merger Agreement, Merger
Subsidiary, a wholly owned subsidiary of Acquiror, shall be merged with and into
the Company, whereupon the separate existence of Merger Subsidiary shall cease
and the Company shall be the surviving corporation;
WHEREAS, Section 7.10 of the Merger Agreement contemplates that Merger
Subsidiary shall execute an amendment to the Merger Agreement and thereby become
a party to the Merger Agreement;
WHEREAS, Section 10.3 of the Merger Agreement provides, generally, that
the Merger Agreement may be amended in writing by the parties thereto; and
WHEREAS, the respective Boards of Directors of the Company, Acquiror
and Merger Subsidiary have approved this Amendment, and deem it advisable and in
the best interests of each corporation and its respective stockholders;
NOW, THEREFORE, the parties hereto agree as follows:
Section 1. Amendment of Merger Agreement. The Merger Agreement is
hereby amended, pursuant to Sections 7.10 and 10.3 thereof, to add Merger
Subsidiary as a party thereto, such that Merger Subsidiary is hereby bound to
the terms thereof.
Section 2. Full Force and Effect. Except as set forth in Section 1 of
this Amendment, the Merger Agreement is not being otherwise amended,
supplemented or modified, and the terms, conditions and agreements set forth in
the Merger Agreement are hereby ratified and confirmed and shall continue in
full force and effect.
Section 3. Governing Law. This Amendment shall be construed in
accordance with and governed by the law of the State of Delaware, without regard
to principles of conflicts of law.
Section 4. Counterparts. This Amendment may be executed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed, all as of the date first written above.
S3 INCORPORATED
/S/ KENNETH F. POTASHNER
By ____________________________________
Kenneth F. Potashner
President and Chief Executive Officer
DIAMOND MULTIMEDIA SYSTEMS, INC.
/S/ WILLIAM J. SCHROEDER
By ___________________________________
William J. Schroeder
President and Chief Executive Officer
DENMARK ACQUISITION SUB, INC.
/S/ KENNETH F. POTASHNER
By ____________________________________
Kenneth F. Potashner
President
<PAGE>
EXHIBIT 23.1
CONSENT OF PRICEWATERHOUSECOOPERS LLP, INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference in the Form 8-K of S3
Incorporated dated September 30, 1999 of our report dated January 29, 1999
relating to the financial statements and financial statement schedule of
Diamond Multimedia Systems, Inc., which appears in Diamond Multimedia Systems
Inc.'s Annual Report on Form 10-K/A Amendment No. 2 for the year ended
December 31, 1998.
/S/ PRICEWATERHOUSECOOPERS LLP
By __________________________________
PricewaterhouseCoopers LLP
September 30, 1999
