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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of Earliest Event Reported) - December 29, 2000
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SPECTRIAN CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 0-24360 77-0023003
(State or other jurisdiction of (Commission File Number) (IRS Employer
Incorporation) Identification No.)
350 West Java Drive 94089
Sunnyvale, California (Zip Code)
(Address of principal executive offices)
(408) 745-5400
(Registrant's telephone number, including area code)
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[N/A]
(Former name or address, if changed since last report)
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<PAGE>
Item 2. Acquisition or Disposition of Assets.
On December 29, 2000, Spectrian Corporation (the "Company") completed
the sale of substantially all of the assets and liabilities comprising the
Company's UltraRF division (the "Business") pursuant to the Asset Purchase
Agreement dated as of November 20, 2000 among Cree, Inc. ("Cree"), Zoltar
Acquisition, Inc. ("Zoltar") and the Company, attached hereto as Exhibit 2.1.
The Asset Purchase Agreement provides for the sale by the Company of
certain assets and liabilities of the Business. The assets sold and liabilities
assumed include business inventories, equipment and tangible property,
intangible assets, contract rights, records, supplies, rights associated with
prepaid expenses, certain rights against third parties, certain software and
certain trade accounts receivable, obligations and liabilities under certain
contracts, warranty obligations and tax obligations and liabilities relating to
the Business.
The aggregate purchase price paid by Cree under the Asset Purchase
Agreement consists of stock consideration of 2,656,917 shares of Cree common
stock.
Cree and its wholly-owned subsidiary, Zoltar, have no material
relationship with the Company or, to the knowledge of the Company, with any of
its affiliates, directors, officers or their associates.
Attached as an Exhibit is a copy of the press release of January 2,
2001, announcing the close of the transaction.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of business acquired.
Not applicable.
(b) Pro Forma Financial information.
The following unaudited pro forma condensed consolidated balance sheet assumes
that the sale of the UltraRF division occurred on October 1, 2000. The following
unaudited pro forma condensed consolidated statement of operations for the
period ended October 1, 2000 and the following unaudited pro forma condensed
consolidated statement of operations for the year ended March 31, 2000
respectively, assumes that the sale occurred on April 1, 1999.
The pro forma financial information is presented for illustrative purposes only
and does not purport to be indicative of the operating results or financial
position that would have occurred had the sale been effected for the periods
indicated nor is it indicative of the future operating results or financial
position of the Company.
The pro forma adjustments are based upon information and assumptions available
at the time of the filing of this Form 8-K.
<PAGE>
Spectrian Corporation
Pro Forma Condensed Consolidated Balance Sheet as at October 1, 2000
(in thousands, except share data) (unaudited)
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<TABLE>
<CAPTION>
Pro Forma Pro Forma
As reported Adjustments Amounts
--------- --------- ---------
<S> <C> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 16,011 $ -- $ 16,011
Short-term investments (Note 2a) 28,211 87,713 115,924
Restricted short-term investments (Note 2a) -- 6,790 6,790
Accounts receivable (Note 2b) 23,998 (277) 23,721
Inventories (Note 2b) 28,059 (6,363) 21,696
Prepaid expenses and other current assets (Note 2b) 8,154 (233) 7,921
Deferred tax asset (Note 4) -- 5,000 5,000
--------- --------- ---------
Total current assets 104,433 92,630 197,063
Property and equipment, net (Note 2b) 18,465 (7,302) 11,163
Other assets 1,268 -- 1,268
--------- --------- ---------
Total assets $ 124,166 $ 85,328 $ 209,494
--------- --------- ---------
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable (Note 2b) $ 17,222 $ (1,342) $ 15,880
Accrued liabilities (Note 2b) 11,373 12,102 23,475
Current portion of debt and capital lease obligations (Note 2b) 1,227 (60) 1,167
Deferred gain on sale of UltraRF (Note 2b) -- 58,000 58,000
Income taxes payable (Note 4) -- 5,000 5,000
--------- --------- ---------
Total current liabilities 29,822 73,700 103,522
Debt and capital lease obligations, net of current
portion (Note 2b) 573 (73) 500
--------- --------- ---------
30,395 73,627 104,022
--------- --------- ---------
Stockholders' equity:
Preferred stock, $0.001 par value, 5,000,000 shares
authorized; non issued and outstanding respectively -- -- --
Common stock, $0.001 par value, 20,000,000 shares
authorized; 12,006,843 and 11,859,507 shares issued,
respectively; 11,006,843 and 10,859,507 shares
outstanding, respectively 12 -- 12
Additional paid-in capital (Note 4) 161,379 -- 161,379
Treasury stock, 1,000,000 shares of common stock
held (14,789) -- (14,789)
Deferred compensation expense (84) -- (84)
Accumulated other comprehensive loss (281) -- (281)
Accumulated deficit (Note 2b) (52,466) 11,701 (40,765)
--------- --------- ---------
Total stockholders equity 93,771 11,701 105,472
--------- --------- ---------
Total liabilities and stockholders' equity $ 124,166 $ 85,328 $ 209,494
--------- --------- ---------
<FN>
The accompanying notes are an integral part of these pro forma
condensed consolidated financial statements.
</FN>
</TABLE>
<PAGE>
Spectrian Corporation
Pro Forma Condensed Consolidated Statement of Operations
For the Six Months Ended October 1, 2000
(in thousands, except per share data) (unaudited)
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<TABLE>
<CAPTION>
Pro Forma Pro Forma
As reported Adjustments Amounts
-------- -------- --------
<S> <C> <C> <C> <C>
Net Revenues (Note 3b) $ 84,106 $ (652) $ 83,454
Costs and expenses:
Cost of revenues (Note 3a) 69,982 4,268 74,250
Research and development (Note 3b) 10,942 (2,411) 8,531
Selling, general and administrative (Note 3b) 11,866 (1,475) 10,391
-------- -------- --------
Total cost and expenses 92,790 382 93,172
-------- -------- --------
Operating loss (8,684) (1,034) (9,718)
Interest income 1,120 -- 1,120
Interest expense (89) (9) (80)
-------- -------- --------
Loss before income taxes (7,653) (1,025) (8,678)
Income taxes (12) -- (12)
-------- -------- --------
Net loss $ (7,665) $ (1,025) $ (8,690)
-------- -------- --------
Net loss per share:
Basic $ (0.70) $ -- $ (0.79)
Diluted $ (0.70) $ -- $ (0.79)
Shares used in computing per share amounts:
Basic 10,945 -- 10,945
Diluted 10,945 -- 10,945
<FN>
The accompanying notes are an integral part of these pro forma
condensed consolidated financial statements.
</FN>
</TABLE>
<PAGE>
Spectrian Corporation
Pro Forma Condensed Consolidated Statement of Operations
For the Year Ended March 31, 2000
(in thousands, except per share data) (unaudited)
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<TABLE>
<CAPTION>
Pro Forma Pro Forma
As reported Adjustments Amounts
--------- --------- ---------
<S> <C> <C> <C> <C>
Net Revenues (Note 3b) $ 163,567 $ (880) $ 162,687
Cost and expenses:
Cost of revenues (Note 3a) 129,998 13,419 143,417
Research and development (Note 3b) 22,488 (4,813) 17,675
Selling, general and administrative (Note 3b) 19,337 (1,377) 17,960
Restructuring costs 1,032 -- 1,032
--------- --------- ---------
Total cost and expenses 172,855 7,229 180,084
--------- --------- ---------
Operating loss (9,288) (8,109) (17,397)
Interest income 3,344 -- 3,344
Interest expense (473) (18) (455)
Other income 624 -- 624
--------- --------- ---------
Loss before income taxes (5,793) (8,091) (13,884)
Income taxes 30 -- 30
--------- --------- ---------
Net loss $ (5,823) $ (8,091) $ (13,914)
--------- --------- ---------
Net loss per share:
Basic $ (0.56) $ -- $ (1.33)
Diluted $ (0.56) $ -- $ (1.33)
Shares used in computing per share amounts:
Basic 10,426 -- 10,426
Diluted 10,426 -- 10,426
<FN>
The accompanying notes are an integral part of these pro forma
condensed consolidated financial statements.
</FN>
</TABLE>
<PAGE>
Spectrian Corporation
Notes to Pro Forma Condensed Consolidated Financial Statements
(unaudited)
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1. On December 29, 2000, the Company completed the sale of its semiconductor
division, UltraRF, to Cree, Inc. ("Cree") for 1,815,000 shares of common
stock of Cree plus common stock with a guaranteed realizable value of $30
million. Cree common stock was valued at $35.53 at the date of sale. Cree
purchased the assets of UltraRF and assumed certain of its external
liabilities as a result of the disposition. As part of the definitive
agreement, the Company and Cree entered into a two-year supply agreement
under which Spectrian is obligated to purchase from Cree an aggregate of
$58 million of semiconductors. In the event Spectrian fails to make these
purchases it is obligated to pay Cree the amount of the shortfall.
Accordingly, Spectrian will defer $58 million of the gain on sale of
UltraRF and recognize it in future periods as the related purchase
commitments to Cree are fulfilled.
2. The pro forma condensed balance sheet reflects the effects of the sale of
UltraRF as if it had been consummated on October 1, 2000 (in thousands):
a. Increase in short-term investments
Increase in short-term investments $ 87,713
Increase in restricted short-term investments 6,790
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$ 94,503
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b. Net gain on sale of UltraRF
Total amount due from Cree $ 94,503
Net book value of inventory (6,363)
Net book value of property and equipment (7,302)
Net book value of third party accounts receivables (277)
Net book value of other assets (233)
Net book value of liabilities assumed by Cree 1,490
Transaction expenses* (12,117)
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Gross gain on sale of UltraRF 69,701
Less: Amount deferred due to supply
agreement (58,000)
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Net gain on sale of UltraRF $ 11,701
----------
* Transaction expenses consist principally of fees to the
Company's financial advisors and certain legal and accounting
fees.
3. The pro forma condensed statement of operations assumed that the sale of
UltraRF had been consummated on April 1, 1999.
a. The increase in cost of revenues of $4,268,000 for the six months
ended October 1, 2000 and $13,419,000 for the year ended March 31,
2000, respectively, reflects the profit on intercompany sales from
UltraRF to Spectrian, which was previously eliminated in the
consolidated financial statements of the Company.
b. Following the close of the sale of UltraRF, the Company will no
longer have revenues related to sales of the UltraRF products to
third party customers. The pro forma condensed statement of
operations has been adjusted to eliminate the net revenues and
operating expenses which the Company believes (i) are directly
attributable to the UltraRF business and (ii) will not continue
after the completion of the sale of UltraRF. These amounts include
the costs directly incurred by UltraRF and rents for facilities
occupied by UltraRF which are being subleased to UltraRF by
Spectrian.
<PAGE>
Spectrian Corporation
Notes to Pro Forma Condensed Consolidated Financial Statements (Continued)
(unaudited)
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Under agreement between Spectrian and Cree, Spectrian is obligated
to buy certain minimum quantities of semiconductors from Cree for
a period of 24 months. Additionally, as a result of the sale,
Spectrian's cost of semiconductors will increase by profits made
by UltraRF on its sales to Spectrian as such profits would now
belong to Cree. The effect of this change has been reflected in
the pro forma statements of operations.
4. Spectrian currently estimates that it will pay income tax of
approximately $5 million as a result of the sale of UltraRF after
utilization of net operating losses carryforwards and certain tax
credits. This payment has been reflected in the deferred tax asset and
income tax payable account.
5. The pro forma condensed consolidated statements of operations has been
prepared for continuing operations and, therefore, do not give effect to
the gain from the sale of UltraRF.
6. The actual impact of the sale of UltraRF could differ from that shown
above due to an adjustment to the proceeds from the sale for the net
increase or decrease in net assets of UltraRF between October 1, 2000 and
the closing date, being December 29, 2000, of the sale.
<PAGE>
(c) Exhibits.
2.1 Asset Purchase Agreement dated as of November 20, 2000 among
Cree, Inc., Zoltar Acquisition, Inc. and Spectrian
Corporation. *
99.1 Press Release dated January 2, 2001.
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* Certain schedules and attachments have been omitted from this filing
pursuant to Item 601(6)(2). A list of omitted schedules and attachments is
attached to the agreement. Registrant hereby agrees to furnish
supplementally to the commission a copy of any omitted schedule or
attachment upon request.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
Spectrian Corporation has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
SPECTRIAN CORPORATION
By: /s/ Michael D. Angel
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Michael D. Angel
Executive Vice President,
Finance and Administration,
Chief Financial Officer and
Secretary
Date: January 16, 2001
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
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2.1 Asset Purchase Agreement dated as of November 20, 2000 among
Cree, Inc., Zoltar Acquisition, Inc. and Spectrian
Corporation.*
99.1 Press Release of Spectrian Corporation, dated January 2, 2000.
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* Certain schedules and attachments have been omitted from this filing
pursuant to Item 601(6)(2). A list of omitted schedules and attachments is
attached to the agreement. Registrant hereby agrees to furnish
supplementally to the commission a copy of any omitted schedule or
attachment upon request.
