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 (Date of earliest event reported): February 7, 1997
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QUICKTURN DESIGN SYSTEMS, INC.
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(Exact name of registrant as specified in its charter)
Delaware 0-22738 77-0159619
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification Number)
incorporation)
440 CLYDE AVENUE, MOUNTAIN VIEW, CALIFORNIA 94043
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (415) 967-3300
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N/A
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(Former name or former address, if changed since last report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On February 7, 1997 (the "Closing Date"), pursuant to an Agreement and
Plan of Reorganization dated as of January 16, 1997 (the "Reorganization
Agreement"), among Quickturn Design Systems, Inc. ("Quickturn"), QT
Corporation, a Delaware corporation and wholly-owned subsidiary of Quickturn
("Merger Sub"), and SpeedSim, Inc., a Delaware corporation ("SpeedSim"),
Quickturn acquired SpeedSim by means of a statutory merger (the "Merger") of
Merger Sub into SpeedSim, with SpeedSim remaining as the surviving
corporation in the Merger. As a result of the Merger, SpeedSim became a
wholly-owned subsidiary of Quickturn. Merger Sub was formed solely for the
purpose of effecting the Merger. Quickturn is a leading provider of
reprogrammable emulation products for system-level design verification.
SpeedSim provides cycle-based simulation technology and develops and markets
SpeedSim/3 for digital logic simulation.
Pursuant to the Reorganization Agreement, an aggregate of 2,827,221
shares of Quickturn Common Stock were issued in exchange for (i) all of the
issued and outstanding capital stock of SpeedSim and (ii) all unexpired and
unexercised options to acquire capital stock of SpeedSim. Each outstanding
share of SpeedSim capital stock was converted into the right to receive a
number of shares of Quickturn Common Stock equal to 2,827,221 divided by the
sum of (i) the total number of shares of SpeedSim capital stock outstanding
on the Closing Date, and (ii) the total number of shares of SpeedSim capital
stock subject to unexpired and unexercised options to purchase SpeedSim
capital stock outstanding on the Closing Date (the "Exchange Ratio"). All
options to purchase SpeedSim capital stock outstanding immediately prior to
the Merger were assumed by Quickturn. Each such option became exercisable
(when vested) for that number of whole shares of Quickturn Common Stock equal
to the product of the number of shares of SpeedSim capital stock subject to
such option multiplied by the Exchange Ratio, rounded down to the nearest
whole number of shares of Quickturn Common Stock. The per share exercise
price of each assumed option is equal to the quotient determined by dividing
the exercise price per share of SpeedSim capital stock subject to such option
immediately prior to the Merger by the Exchange Ratio, rounded up to the
nearest whole cent.
The consideration paid by Quickturn for the outstanding capital stock of
SpeedSim pursuant to the Reorganization Agreement was determined pursuant to
arms' length negotiations and took into account various factors concerning
the valuation of the business of SpeedSim, including public market valuations
of comparable companies, discounted cash flows for SpeedSim, and multiples
paid in recent acquisitions of comparable companies.
ITEM 5. OTHER EVENTS.
On January 16, 1997 Quickturn announced that for the year ended December
31, 1996, revenue was $104.4 million, an increase of 28% over 1995 revenue of
$81.8 million. Operating income was $16.3 million, an increase of 39% over
the operating income of $11.7 million in 1995. Net income was $12.6 million
or $0.83 per share, compared to net income of $13.1 million or $0.90 per
share in 1995.
Both the 1996 results and the results for the fourth quarter of 1996
include a net year-to-date tax benefit of $542,000 or $0.03 per share
comprised of a one time recognition of deferred tax assets. Both the 1995
results and the results for the fourth quarter of 1995 include a net
year-to-date tax benefit of $3.7 million or $0.26 per share comprised of a
one time recognition of deferred tax assets of $6.0 million or $0.41 per
share offset by an increased tax expense of $2.3 million or $0.15 per share.
Fourth quarter revenue of $28.8 million was up 25% over revenue of $23.0
million in the comparable period of 1995 and up 6% over the previous quarter
of $27.2 million. Operating income was $4.8 million, an
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increase of 33% over the operating income of $3.6 million in the fourth
quarter of 1995 and compared to operating income of $4.2 million in the third
quarter of 1996. Net income was $4.1 million or $0.26 per share, compared to
$6.6 million or $0.45 per share in the fourth quarter of 1995 and an increase
of 29% over the net income of $3.2 million or $0.21 per share in the third
quarter of 1996.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF SPEEDSIM
The Financial Information required to be filed pursuant to Item
7(a) of Form 8-K was not available at the time of filing of this Current
Report on Form 8-K and will be filed on a Form 8-K/A as soon as practicable,
but in no event later than 60 days after the date this Form 8-K is required
to be filed.
(b) PRO FORMA FINANCIAL INFORMATION.
The Pro Forma Financial Information required to be filed pursuant
to Item 7(b) of Form 8-K was not available at the time of filing of this
Current Report on Form 8-K and will be filed on a Form 8-K/A as soon as
practicable, but in no event later than 60 days after the date this Form 8-K
is required to be filed.
(c) EXHIBITS
2.1 Agreement and Plan of Reorganization dated as of January 16,
1997.
2.2 Certificate of Merger dated February 7, 1997, filed with
the Secretary of State of the State of Delaware on
February 7, 1997.
20.1 Press Release of Quickturn, dated January 16, 1997,
announcing the financial results for the quarter and year
ended December 31, 1996.
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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 hereunto duly authorized.
Dated: February __, 1997 QUICKTURN DESIGN SYSTEMS, INC.
/s/ Raymond K. Ostby
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Raymond K. Ostby
Vice President, Finance and
Administration, Chief Financial Officer
and Secretary
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INDEX TO EXHIBITS
Exhibit
Number Description of Document
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2.1 Agreement and Plan of Reorganization dated as of January 16,
1997.
2.2 Certificate of Merger dated February 7, 1997, filed with the
Secretary of State of the State of Delaware on February 7, 1997.
20.1 Press Release of Quickturn, dated January 16, 1997, announcing
the financial results for the quarter and year ended
December 31, 1996.