UNITED STATES
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
February 24, 2005
(Date of earliest event reported)
RF Micro Devices, Inc.
(Exact name of registrant as specified in its charter)
North Carolina | 0-22511 | 56-1733461 |
(State or Other Jurisdiction | (Commission File | (I.R.S. Employer |
of Incorporation) | Number) | Identification No.) |
7628 Thorndike Road
Greensboro, North Carolina 27409-9421
(Address of principal executive offices, including zip code)
(336) 664-1233
(Registrant's telephone number, including area code)
Item 2.05. Costs Associated with Exit or Disposal Activities.
On February 24, 2005, the Board of Directors of RF Micro Devices, Inc. (the "Company") committed to a plan to discontinue the Company's internal wireless local area network (WLAN) chipset development efforts as a result of the Company's inability to bring competitive WLAN chipset solutions to market in a timely manner. The Company will continue to support its WLAN component business, which includes its transceivers for gaming and other applications as well as its WLAN power amplifiers and front-end modules for all WLAN markets.
As a result of the discontinuation of its internal WLAN chipset development efforts, the Company will reduce its WLAN chipset workforce in its San Jose, California location, close its offices in Moscow, Russia and Leuven, Belgium and transfer certain people and resources into other emerging opportunities and product lines within the Company. These actions are expected to be completed by the end of the fourth quarter of fiscal 2005. The results of these actions are expected to reduce the Company's ongoing operating expenses by approximately $18.0 million to $22.0 million per year, commencing in the Company's fiscal year ending March 31, 2006, which begins April 1, 2005. Additionally, these actions are expected to result in cash charges for employee severance and related payroll costs of approximately $2.0 million to $3.0 million and lease termination costs of approximately $1.0 million. These cash charges are expected to be recognized in the fourth quarter of fiscal 2005 and the first quarter of fiscal 2006, respectively. During the fourth quarter of fiscal 2005, the Company may also record a non-cash charge for impairment of equipment of up to $3.5 million, depending on the alternative uses available for such equipment, and will incur a non-cash charge for impairment of intangible assets, consisting of acquired technology licenses and excluding goodwill, if any, of approximately $37.0 million. The total costs expected to be incurred in connection with the discontinuation of the internal WLAN chipset development efforts are approximately $40.0 million to $44.5 million.
The Company will determine the amount of goodwill impairment, if any, with the assistance of an independent valuation firm during the fourth quarter of fiscal year 2005. The Company currently anticipates that the discontinuation of its WLAN chipset development efforts will not materially impact quarterly revenue for the fourth quarter of fiscal 2005 and does not currently expect that this action will result in future cash expenditures, other than as outlined above.
Item 2.06. Material Impairments.
The disclosure included in response to Item 2.05 is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits
Exhibit No. Description of Exhibit
99.1 Press Release dated February 28, 2005
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 hereunto duly authorized.
RF Micro Devices, Inc.
By:/s/ Barry D. Church
Barry D. Church
Vice President and Corporate Controller
Date: February 28, 2005
