<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________
FORM 8-K/A
AMENDMENT NO. 1
Current Report Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of Earliest Event Reported)
April 29, 1996
________________________________________
RADISYS CORPORATION
(Exact name of registrant as specified in its charter)
State of Oregon 0-26844 93-0945232
(State or other (Commission (IRS Employer
jurisdiction of File No.) Identification No.)
incorporation of
organization)
15025 S.W. Koll Parkway
Beaverton, Oregon 97006
(Address of principal executive offices)
(503) 646-1800
(Registrant's telephone number,
including area code)
No Change
(Former name or address, if changed since last report)
_________________________________________
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial statements of business acquired
Presented on pages 3 through 9 are (i) the Report of Ernst & Young LLP,
independent auditors, and the accompanying audited statements of assets
acquired of the iRMX/Multibus Operation of Intel Corporation ("Multibus")
as of December 30, 1995 and December 31, 1994 and the related statements
of net revenues and direct expenses for the three years in the period
ended December 30, 1995 and (ii) the unaudited statements of assets
acquired of Multibus as of March 30, 1996 and the related statements of
net revenues and direct expenses for the three-month periods ended
March 30, 1996 and April 1, 1995.
<PAGE>
FINANCIAL STATEMENTS
IRMX/MULTIBUS OPERATION OF INTEL CORPORATION
YEARS ENDED DECEMBER 30, 1995,
DECEMBER 31, 1994, AND DECEMBER 25, 1993
WITH REPORT OF INDEPENDENT AUDITORS
<PAGE>
iRMX/Multibus Operation of Intel Corporation
Financial Statements
Years ended December 30, 1995,
December 31, 1994, and December 25, 1993
CONTENTS
Report of Ernst & Young LLP, Independent Auditors ....................... 1
Audited Financial Statements
Statements of Assets Acquired............................................ 2
Statements of Net Revenues and Direct Expenses........................... 3
Notes to Financial Statements............................................ 4
<PAGE>
Report of Ernst & Young LLP, Independent Auditors
The Board of Directors and Shareholders
Intel Corporation
We have audited the accompanying statements of assets acquired of the
iRMX/Multibus Operation (OMO) of Intel Corporation as of December 30, 1995 and
December 31, 1994, and the related statements of net revenues and direct
expenses for the three years in the period ended December 30, 1995. These
financial statements are the responsibility 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 audit 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.
As described in Note 1, the accompanying financial statements were prepared
solely to present the assets of OMO acquired by RadiSys Corporation pursuant to
the purchase agreement dated April 29, 1996, and the related net revenues and
direct expenses of OMO, and are not intended to be a complete presentation of
the assets and liabilities or the results of operations of the iRMX/Multibus
Operation of Intel Corporation.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the assets acquired of the iRMX/Multibus Operation of
Intel Corporation at December 30, 1995 and December 31, 1994, and the net
revenues and direct expenses for the three years in the period ended December
30, 1995, in conformity with generally accepted accounting principles.
Ernst & Young LLP
San Jose, California
June 14, 1996
<PAGE>
iRMX/Multibus Operation of Intel Corporation
Statements of Assets Acquired
(In Thousands)
DECEMBER 30, DECEMBER 31, MARCH 30,
1995 1994 1996
--------------------------------------------
(Unaudited)
Inventory:
Raw materials $3,229 $2,491 $2,417
Work-in-process 1,141 1,929 708
Finished goods 3,606 3,258 4,054
--------------------------------------------
Total inventory 7,976 7,678 7,179
Property, plant, and equipment:
Machinery and equipment 6,673 6,572 6,673
Accumulated depreciation 6,362 6,173 6,384
--------------------------------------------
Net property, plant, and equipment 311 399 289
--------------------------------------------
Assets acquired $8,287 $8,077 $7,468
--------------------------------------------
--------------------------------------------
See accompanying notes.
<PAGE>
iRMX/Multibus Operation of Intel Corporation
Statements of Net Revenues and Direct Expenses
(In Thousands)
<TABLE>
<CAPTION>
YEARS ENDED THREE MONTHS ENDED
DECEMBER 30, DECEMBER 31, DECEMBER 25, MARCH 30, APRIL 1,
1995 1994 1993 1996 1995
--------------------------------------------------------------------------
(Unaudited)
<S> <C> <C> <C> <C> <C>
Net revenues $75,127 $76,937 $78,422 $14,787 $15,834
Direct expenses:
Cost of sales 32,635 40,395 41,902 6,873 7,492
Operating expenses:
Research and development 1,206 2,128 2,272 297 304
Selling, marketing, and administrative 2,595 3,386 4,487 522 723
--------------------------------------------------------------------------
Total operating activities 3,801 5,514 6,759 819 1,027
--------------------------------------------------------------------------
Total direct expenses 36,436 45,909 48,661 7,692 8,519
--------------------------------------------------------------------------
Net revenues less direct expenses $38,691 $31,028 $29,761 $7,095 $7,315
--------------------------------------------------------------------------
--------------------------------------------------------------------------
See accompanying notes.
</TABLE>
<PAGE>
1. BASIS OF PRESENTATION
Intel Corporation (Intel or the Company) has a fiscal year that ends the last
Saturday in December. Fiscal years 1995 and 1993, each a 52-week year, ended on
December 30 and December 25, respectively. Fiscal 1994 was a 53-week year and
ended on December 31, 1994.
The iRMX/Multibus Operation (OMO) has operated as a business operation of Intel
Corporation. The accompanying financial statements were prepared to present the
assets of OMO acquired by RadiSys Corporation, pursuant to the purchase
agreement dated April 29, 1996, and the related net revenues and direct
expenses of OMO. The financial statements are not intended to be a complete
presentation of the results of operations of OMO.
The OMO business consists of Multibus boards and related software which are
sold into the Embedded Industrial Bus Computing marketplace. The principal
markets for these products are in the U.S., Europe, Japan, and Asia Pacific.
The OMO business had no separate legal status as it was an integral part of
Intel Corporation's overall operations. As a result, separate financial
statements have not been maintained for the operations acquired by RadiSys
Corporation.
The accompanying financial statements have been prepared from the historical
accounting records of Intel Corporation and do not purport to reflect the
assets and the net revenues and direct expenses that would have resulted if OMO
had operated as an unaffiliated independent company. Since only certain assets
are being acquired, statements of cash flows are not applicable.
Accounts denominated in foreign currencies have been remeasured into the
functional currency in accordance with Statement of Financial Accounting
Standards No. 52, "Foreign Currency Translation," (FAS 52) using the U.S.
dollar as the functional currency. Intel records certain remeasurement
adjustments at the corporate level. Accordingly, estimates have been made to
reflect estimated adjustments necessary to reflect revenues derived from sales
in foreign currencies in accordance with FAS 52. Intel believes that these
adjustments are reasonable.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.
The unaudited interim financial statements reflect all adjustments which are,
in the opinion of management, necessary to a fair statement of the results for
the interim periods presented. The unaudited interim financial statements are
not necessarily indicative of future financial performance.
2. SIGNIFICANT ACCOUNTING POLICIES
INVENTORY
Inventory is stated at the lower of cost or market. Cost is computed on a
currently adjusted standard basis which approximates actual cost on a first-in,
first-out basis.
<PAGE>
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
PROPERTY, PLANT, AND EQUIPMENT
Property, plant, and equipment are stated at cost. Depreciation is computed for
financial reporting purposes principally by the use of the straight-line method
over the estimated useful lives (four years) of the assets. Direct operating
expenses include depreciation expense of $189,000, $473,000, and $577,000 for
the years ended December 30, 1995, December 31, 1994, and December 25, 1993,
respectively, and $22,000 and $47,000 for the three months ended March 30, 1996
and April 1, 1995, respectively, related to the assets acquired.
REVENUES
Net revenues per the accompanying financial statements represent billings by
Intel Corporation for the products acquired by RadiSys Corporation. Although
Intel maintains reserves for returns and defers revenue on sales to
distributors at the consolidated level, it does not record or maintain such
information at a product line level. Accordingly, adjustments have been made to
reflect estimated sales returns in accordance with FAS 48. Intel believes that
these estimates are reasonable.
No customer exceeded 10% of revenues in 1993 or 1994. Two significant customers
accounted for 17% and 11% of revenues in 1995.
DIRECT EXPENSES
The caption "Direct Expenses" on the accompanying financial statements
represents that portion of the total Direct Expenses of Intel Corporation
incurred by OMO and/or allocated to OMO by Intel Corporation. OMO does not
have separate and unique manufacturing, cost of sales, research and
development, or selling, marketing, and administrative expenses. Intel
allocates corporate services, facilities, information services, and other
selling, general and administrative services, etc., based on estimated usage
determined by actual headcount. There is no allocation of interest income,
interest expense, or income taxes. Cost of sales is computed based on
absorption of manufacturing costs using an allocation model for overhead
charges and is not necessarily indicative of the costs that would have been
incurred by an independent third party purchaser. These direct expenses are
not necessarily indicative of the expenses that would have been incurred had
OMO operated as a stand-alone business.
3. SUBSEQUENT EVENT
On April 29, 1996, the assets of OMO on the accompanying statement of assets
acquired were acquired by RadiSys Corporation.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (CONTINUED)
(b) Pro Forma Financial Information
Presented on pages 11 through 15 are the unaudited pro forma condensed
combined balance sheet as of March 31, 1996 prepared as if the
Multibus acquisition occurred at that date, and the unaudited pro
forma condensed combined statement of operations for the three months
ended March 31, 1996 and the twelve months ended December 31, 1995 as
if the Multibus acquisition occurred at the beginning of the
respective periods.
The acquisition was financed by the issuance of shares of common stock
("Common Stock") of RadiSys Corporation (the "Company"), warrants to
purchase additional shares of Common Stock and cash on hand using the
purchase method of accounting. The unaudited pro forma financial
statements reflect, among other adjustments, purchase accounting and
estimated fair market value allocation of the assets acquired and the
obligations assumed.
In the opinion of management of the Company, all adjustments necessary
to present fairly such pro forma financial statements have been made
based on the terms and structures of the transaction. These unaudited
pro forma financial statements are not necessarily indicative of what
actual results would have been had the Multibus acquisition occurred
at the beginning of the respective periods nor do they purport to
indicate the results of future operations of the Company.
These unaudited pro forma financial statements should be read in
conjunction with the accompanying notes and the historical financial
statements and notes thereto of the Company.
<PAGE>
PRO FORMA CONDENSED COMBINED BALANCE SHEET
RADISYS CORPORATION AND
IRMX/MULTIBUS OPERATION OF INTEL CORPORATION
MARCH 31, 1996
(Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
RADISYS IRMX/ PRO FORMA PRO FORMA
CORPORATION MULTIBUS ADJUSTMENTS NOTES COMBINED
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ASSETS:
Cash and cash equivalents $ 20,049 $ 20,049
Receivables 7,275 7,275
Inventories 5,453 $ 7,179 $ 3,257 (b) 15,889
Other current assets 1,991 225 (c) 2,216
--------------------------------------------- ---------------
Total current assets 34,768 7,179 3,482 45,429
--------------------------------------------- ---------------
Equipment 8,483 6,673 (4,084) (d) 11,072
Accumulated depreciation (4,162) (6,384) 6,384 (d) (4,162)
--------------------------------------------- ---------------
Equipment, net 4,321 289 2,300 6,910
--------------------------------------------- ---------------
Other assets 786 786
--------------------------------------------- ---------------
Total assets $ 39,875 $ 7,468 $ 5,782 $ 53,125
--------------------------------------------- ---------------
--------------------------------------------- ---------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities $ 3,656 $ 350 (a) $ 4,006
--------------------------------------------- ---------------
Long term obligations 826 1,200 (a) 2,026
--------------------------------------------- ---------------
Shareholders' equity
Common stock 33,633 10,500 (a) 44,133
Warrants for common stock 1,200 (a) 1,200
Cumulative translation adjustment (90) (90)
Retained earnings 1,850 1,850
--------------------------------------------- ---------------
35,393 11,700 47,093
--------------------------------------------- ---------------
Total liabilities and shareholders'
equity $ 39,875 - $ 13,250 $ 53,125
--------------------------------------------- ---------------
--------------------------------------------- ---------------
</TABLE>
<PAGE>
RADISYS CORPORATION
NOTES TO PRO FORMA CONDENSED COMBINED BALANCE SHEET
NOTE 1 - The pro forma condensed combined balance sheet has been prepared to
reflect the acquisition of the iRMX/Multibus operation of Intel Corporation, as
if the acquisition occurred as of the balance sheet date, for 1.3 million
shares of the Company's common stock ("Common Stock") and warrants to purchase
an additional 300,000 shares of Common Stock exercisable within 24 months at
prices per share ranging from $13.50 to $15.00, plus an aggregate of $1.2
million in cash to be paid in 1997. The pro forma condensed combined balance
sheet is not necessarily indicative of balances which would have resulted had
the acquisitions actually occurred on the balance sheet date. Pro forma
adjustments are made to reflect the following:
a. The issuance of 1.3 million shares of the Company's common stock ("Common
Stock") and warrants to purchase an additional 300,000 shares of Common
Stock exercisable within 24 months at prices per share ranging from $13.50
to $15.00, plus an aggregate of $1.2 million in cash to be paid in 1997.
Also accrual of direct costs of acquisition estimated to be approximately
$350,000.
b. Adjustment to reflect aggregate of inventory to be delivered to RadiSys
Corporation in connection with the acquisition, plus adjustment of $1.3
million to state inventory balances at their assumed fair market value at
acquisition.
c. Adjustment to reflect purchased in process research and development at its
assumed fair market value.
d. Adjustment to state fixed asset balances at their assumed fair market
value at acquisition.
<PAGE>
PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
RADISYS CORPORATION AND
IRMX/MULTIBUS OPERATION OF INTEL CORPORATION
FOR THE THREE MONTHS ENDED MARCH 31, 1996
(Unaudited)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
RADISYS IRMX/ PRO FORMA PRO FORMA
CORPORATION MULTIBUS ADJUSTMENTS Notes COMBINED
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net revenues $ 11,065 $ 14,787 $ 25,852
Cost of sales 7,398 6,873 $ 4,200 (a),(b) 18,471
------------------------------------------------- -------------------
3,667 7,914 (4,200) 7,381
Research and development 1,130 297 700 (c),(d),(e) 2,127
Selling, marketing, and administrative 1,903 522 1,400 (d) 3,825
------------------------------------------------- -------------------
Income from operations 634 7,095 (6,300) 1,429
Interest income 253 253
------------------------------------------------- -------------------
Income before income tax provision 887 7,095 (6,300) 1682
Income tax provision 337 235 (f) 572
------------------------------------------------- -------------------
Net income $ 550 $ 7,095 $ (6,535) $ 1,110
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Net income per share $ 0.09 $ 0.14
------------------- -------------------
------------------- -------------------
Weighted average shares outstanding 6,162 1,600 (g) 7,762
------------------- -------------------
------------------- -------------------
</TABLE>
<PAGE>
PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
RADISYS CORPORATION AND
IRMX/MULTIBUS OPERATION OF INTEL CORPORATION
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1995
(Unaudited)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
RADISYS IRMX/ PRO FORMA PRO Forma
CORPORATION MULTIBUS Adjustments NOTES COMBINED
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net revenues $ 35,025 $ 75,127 $ 110,152
Cost of sales 22,992 32,635 $ 18,200 (a),(b) 73,827
------------------------------------------------- -------------------
12,033 42,492 (18,200) 36,325
Research and development 3,301 1,206 5,100 (c),(d),(e) 9,607
Selling, marketing, and administrative 6,714 2,595 7,200 (d) 16,509
------------------------------------------------- -------------------
Income from operations 2,018 38,691 (30,500) 10,209
Interest income 170 170
------------------------------------------------- -------------------
Income before income tax provision 2,188 38,691 (30,500) 10,379
Income tax provision 672 2,850 (f) 3,522
------------------------------------------------- -------------------
Net income $ 1,516 38,691 (33,350) $ 6,857
------------------------------------------------- -------------------
------------------------------------------------- -------------------
Net income per share $ 0.35 $ 1.15
------------------- -------------------
------------------- -------------------
Weighted average shares outstanding 4,355 1,600 (g) 5,955
------------------- -------------------
------------------- -------------------
</TABLE>
<PAGE>
RADISYS CORPORATION
NOTES TO PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
NOTE 1 - The pro forma condensed combined statement of operations has been
prepared to reflect the acquisition of the iRMX/Multibus operation of Intel
Corporation, as if the acquisition occurred as of the beginning of the period
presented, for 1.3 million shares of the Company's common stock ("Common
Stock") and warrants to purchase an additional 300,000 shares of Common Stock
exercisable within 24 months at prices per share ranging from $13.50 to $15.00,
plus an aggregate of $1.2 million in cash to be paid in 1997. The pro forma
condensed combined statements of operations are not necessarily indicative of
balances which would have resulted had the acquisition actually occurred at the
beginning of the period presented. Pro forma adjustments are made to reflect
the following:
a. Adjustment to reflect increased cost of goods sold from the sale of
inventory balances adjusted to their assumed fair market value at
acquisition.
b. Adjustment to reflect the assumed increase in costs to manufacture or
purchase the iRMX/Multibus products as a stand alone entity.
c. Adjustment to reflect increased depreciation resulting from the
adjustment of fixed asset balances to their assumed fair market value at
acquisition.
d. Adjustment to reflect assumed research and development and selling,
general and administrative expenses that would have been incurred had the
iRMX/Multibus operations been a stand alone entity.
e. Adjustment to expense in process research and development recorded in
purchase accounting.
f. Adjustment to reflect the estimated impact on tax expense of the
acquisition.
g. The issuance of 1.3 million shares of the Company's common stock ("Common
Stock") and warrants to purchase an additional 300,000 shares of Common
Stock exercisable within 24 months at prices per share ranging from $13.50
to $15.00.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (CONTINUED)
(c) Exhibits
#*2.1 Asset Purchase Agreement between RadiSys Corporation and
Intel Corporation, dated as of April 29, 1996
#2.2 List of omitted schedules to Asset Purchase Agreement
between RadiSys Corporation and Intel Corporation, dated as
of April 29, 1996
23.1 Consent of Ernst & Young LLP
#Previously filed.
*Confidential treatment of portions of this document has been requested.
<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.
Dated: July 1, 1996
RADISYS CORPORATION
By: /s/Brian V. Turner
--------------------------------------------------
Brian V. Turner
Vice President of Finance and Administration and
Chief Financial Officer
(Principal Financial and Accounting Officer)
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION SEQUENTIAL PAGE NO.
- ---------- ----------- -------------------
#*2.1 Asset Purchase Agreement between RadiSys
Corporation and Intel Corporation, dated
as of April 29, 1996
#2.2 List of omitted schedules to Asset Purchase
Agreement between RadiSys Corporation and
Intel Corporation, dated as of April 29, 1996
23.1 Consent of Ernst & Young LLP
#Previously filed.
*Confidential treatment of portions of this document has been requested.
<PAGE>
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statements
(Form S-8 Nos. 333-00514 and 33-80577) of our report dated June 14, 1996 with
respect to the statements of assets acquired of the iRMX/Multibus Operation
of Intel Corporation as of December 30, 1995 and December 31, 1994, and the
related statements of net revenues and direct expenses for the three years in
the period ended December 30, 1995 included in the Current Report on Form
8K/A dated July 1, 1996.
ERNST & YOUNG LLP
San Jose, California
June 27, 1996
