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): November 13, 2001
BE INCORPORATED
(Exact name of registrant as specified in its charter)
DELAWARE 000-26387 94-3123667
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
800 EL CAMINO REAL, SUITE 400
MENLO PARK, CALIFORNIA 94025
(Address of principal executive offices)
(650) 462-4100
(Registrant's telephone number, including area code)
Item 2. Acquisition or Disposition of Assets
Effective November 13, 2001, Be Incorporated ("Be") and Palm, Inc., a
Delaware corporation ("Palm"), completed Palm's acquisition of substantially all
of the intellectual property and other technology assets of Be (the "Asset
Sale") pursuant to the terms of an Amended and Restated Asset Purchase
Agreement, dated September 10, 2001, entered into between Be, Palm and ECA
Subsidiary Acquisition Corporation, a Delaware corporation and wholly-owned
subsidiary of Palm (the "Agreement"). The aggregate consideration received by Be
at closing was 4,104,478 shares of Palm common stock, established pursuant to
the terms of the Agreement as the share value of $11 million of Palm common
stock based on the opening price of Palm common stock ($2.68) as quoted on the
Nasdaq National Market on the closing date of the transaction. Under the terms
of the Agreement, Be will be retaining certain rights, assets and liabilities in
connection with the transaction, including its cash and cash equivalents,
receivables, certain contractual liabilities under in-licensing agreements, and
rights to assert and bring certain claims and causes of action.
The parties completed the Asset Sale following a special meeting of
Be's stockholders on November 12, 2001, whereby a majority of Be's stockholders
approved the Asset Sale and the dissolution of Be and adoption of a plan of
dissolution that provides for the orderly liquidation of Be's remaining assets,
the winding-up of Be's business and operations and the dissolution of the
company (the "Plan of Dissolution"). Under the terms of the Plan of Dissolution,
if the Board of Directors of Be determines that it would be in the best
interests of Be's stockholders or creditors for Be not to dissolve, including in
order to permit Be to pursue (or more easily pursue) any retained claims or
causes of action, the dissolution of the company may be abandoned or delayed
until a future date to be determined by Be's Board of Directors.
On November 13, 2001, Be sold the 4,104,478 shares of Palm common stock
received in the Asset Sale for approximately $10.1 million in cash.
Prior to the Asset Sale, Be had no relationship with Palm, ECA or any
director or officer of either company.
Item 5. Other Events.
Be's press release, dated November 13, 2001, titled "Palm Completes
Acquisition of Be Incorporated" is attached hereto as Exhibit 99.1.
1
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial statements of business acquired. Not applicable.
(b) Pro forma financial information.
The following unaudited pro forma condensed consolidated statements of
operations for the year ended December 31, 2000 and the nine months ended
September 30, 2001, as well as the unaudited pro forma condensed consolidated
balance sheet of Be as of September 30, 2001 were prepared to illustrate the
estimated effects of the asset sale. The unaudited pro forma balance sheet
assumes the sale occurred as of September 30, 2001. The unaudited pro forma
statements of operations assume the sale ocurred as of January 1, 2000.
The unaudited pro forma financial information presented is derived from the
audited consolidated statement of operations of Be for the year ended December
31, 2000 and from the unaudited consolidated financial statements of Be as of
and for the nine month period ended September 30, 2001. The unaudited pro forma
financial information should be read in conjunction with "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
the consolidated financial statements of Be, including the notes thereto,
appearing in Be's Annual Report on Form 10-K for the year ended December 31,
2000 and on Be's Quarterly Report on Form 10-Q for the quarter ended September
30, 2001. The unaudited pro forma financial information and related notes are
provided for informational purposes only and do not purport to be indicative of
the financial position or results of operations that would have been reported
had the events assumed occurred on the dates indicated, or purport to be
indicative of results of operations, or financial condition that may be achieved
in the future.
2
BE INCORPORATED
UNAUDITED PRO FORMA FINANCIAL INFORMATION
CONSOLIDATED BALANCE SHEET AS OF
SEPTEMBER 30, 2001
(in thousands)
Historical Sale As
Be Adjustments Adjusted
-------- ----- -------
ASSETS
Current assets:
Cash and cash equivalents ......................... $ 2,098 $ -- $ 2,098
Short-term investments ............................ 11,000 (a) 11,000
Accounts receivable ............................... 74 74
Prepaid and other current assets .................. 577 -- 577
-------- ----- -------
Total current assets .......................... 2,749 11,000 13,749
Property and equipment, net .......................... 248 -- 248
Other assets, net of accumulated amortization ........ 24 -- 24
-------- ----- -------
Total assets ................................. $ 3,021 $ 11,000 $ 14,021
======== ===== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable .................................. $ 111 $ -- $ 111
Accrued expenses .................................. 621 3,655 (b) 4,276
Technology license obligations, current portion ... 432 -- 432
Deferred revenue .................................. 64 -- 64
-------- ----- -------
Total current liabilities ..................... 1,228 3,655 4,883
Technology license obligations, net of current portion 244 -- 244
-------- ----- -------
Total liabilities ............................. 1,472 3,655 5,127
-------- ----- -------
Stockholders' Equity:
Common stock ...................................... 37 2 (c) 39
Additional paid-in capital ........................ 108,344 192 (c) 108,536
Accumulated other comprehensive income ............ -- -- --
Deferred stock compensation ....................... (280) -- (280)
Accumulated deficit ............................... (106,552) 7,151 (99,401)
-------- ----- -------
Total stockholders' equity .................... 1,549 7,345 8,894
-------- ----- -------
Total liabilities and stockholders' equity ... $ 3,021 $ 11,000 $ 14,021
======== ===== =======
3
BE INCORPORATED
UNAUDITED PRO FORMA FINANCIAL INFORMATION
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except per share data)
Historical
Historical Pro Forma Nine months Pro Forma
Year ended Pro Forma Year ended ended Pro Forma Nine months ended
12/31/00 Adjustments 12/31/00 9/30/01 Adjustments 9/30/01
-------- -------- -------- -------- -------- --------
Net revenues ...................... $ 480 $ (480) (d) $ -- $ 1,950 $ (1,950) (d) $ --
Cost of revenues .................. 1,097 (1,097) (d) -- 2,336 (2,336) (d) --
-------- -------- -------- -------- -------- --------
Gross profit (loss) ............... (617) 617 -- (386) 386 --
Operating expenses:
Research and development ...... 9,139 (5,018) (e) 4,121 6,112 (2,688) (e) 3,424
Sales and marketing ........... 7,812 (170) (e) 7,642 1,688 (123) (e) 1,565
General and administrative .... 4,740 (289) (e) 4,451 3,790 (219) (e) 3,571
Restrucuturing charge ......... -- -- -- 450 -- 450
-------- -------- -------- -------- -------- --------
Total operating expenses .... 21,691 (5,477) 16,214 12,040 (3,031) 9,009
-------- -------- -------- -------- -------- --------
Loss from operations .............. (22,308) 6,094 (16,214) (12,426) 3,417 (9,009)
Other income, net ................. 1,156 -- 1,156 249 -- 249
-------- -------- -------- -------- -------- --------
Net income (loss) ................. $(21,152) $ 6,094 $(15,058) $(12,177) $ 3,417 $ (8,760)
======== ======== ======== ======== ======== ========
Net loss per share -
basic and diluted ................. $ (0.60) $ (0.42) $ (0.33) $ (0.24)
======== ======== ======== ========
Shares used in per common share
calculation - basic and diluted 35,533 35,533 36,430 36,430
======== ======== ======== ========
4
BE INCORPORATED
NOTES TO UNAUDITED PRO FORMA FINANCIAL INFORMATION
(in thousands, except per share amounts)
NOTE 1 - BASIS OF PRESENTATION:
The unaudited pro forma financial information gives effect to the Asset
Sale, as defined below. The unaudited pro forma balance sheet assumes the sale
occurred as of September 30, 2001. The unaudited pro forma statements of
operations assume the sale ocurred as of January 1, 2000.
Effective November 13, 2001, Be Incorporated ("Be") and Palm, Inc., a
Delaware corporation ("Palm"), completed Palm's acquisition of substantially all
of the intellectual property and other technology assets of Be (the "Asset
Sale") pursuant to the terms of an Amended and Restated Asset Purchase
Agreement, dated September 10, 2001, entered into between Be, Palm and ECA
Subsidiary Acquisition Corporation, a Delaware corporation and wholly-owned
subsidiary of Palm (the "Agreement"). The aggregate consideration received by Be
at closing was 4,104,478 shares of Palm common stock, established pursuant to
the terms of the Agreement as the share value of $11 million of Palm common
stock based on the opening price of Palm common stock ($2.68) as quoted on the
Nasdaq National Market on the closing date of the transaction. The parties
completed the Asset Sale following a special meeting of Be's stockholders on
November 12, 2001, whereby a majority of Be's stockholders approved the Asset
Sale and the dissolution of Be and adoption of a plan of dissolution that
provides for the orderly liquidation of Be's remaining assets, the winding-up of
Be's business and operations and the dissolution of the company.
The pro forma information presented herein does not include the adjustments
related to the dissolution of the Company.
NOTE 2 - PRO FORMA ADJUSTMENTS:
The following pro forma adjustments were applied to the pro forma financial
information:
(a) To record the total sale price of approximately $11 million paid in
shares of common stock of Palm. Be liquidated these shares by selling
them for approximately $10.1 million in cash promptly following the
closing of the Asset Sale.
(b) To record accrual for estimated costs related to the Asset Sale, which
include net payments to employees of $2.8 million and other
liabilities of $825,000, including $750,000 owed to Lehman Brothers.
(c) Torecord the estimated non cash expense related to stock bonuses
granted to employees.
(d) To record the elimination of revenues, and associated costs, generated
from substantially all of Be's intellectual property and other
technology assets sold to Palm; and
(e) To record the elimination of actual expenses incurred during the
respective period for the employees hired by Palm.
5
(c) Exhibits
Exhibit Number Description
----------------------- -----------
2.1 Amended and Restated Asset Purchase Agreement, dated as of
September 10, 2001, by and among Palm, Inc., ECA Subsidiary
Acquisition Corporation and Be Incorporated.
2.2 Plan of Dissolution of Be Incorporated, as approved by a majority
of Be's stockholders at a special meeting of stockholders on
November 12, 2001.
99.1 Press release, dated November 13, 2001, titled "Palm Completes
Acquisition of Be Incorporated."
6
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.
Date: November 28, 2001
BE INCORPORATED
By: /s/ P.C. Berndt
P.C. Berndt, Chief Financial Officer
7
EXHIBIT INDEX
(c) Exhibit Number Description
--------------- -----------
2.1 Amended and Restated Asset Purchase Agreement, dated as of
September 10, 2001, by and among Palm, Inc., ECA Subsidiary
Acquisition Corporation and Be Incorporated.
2.2 Plan of Dissolution of Be Incorporated, as approved by a majority
of Be's stockholders at a special meeting of stockholders on
November 12, 2001.
99.1 Press release, dated November 13, 2001, titled "Palm Completes
Acquisition of Be Incorporated."
8