UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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) March 4, 2005
Neoware Systems, Inc.
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(Exact Name of Registrant as Specified in Its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
000-21240 23-2705700
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(Commission File Number) (IRS Employer Identification No.)
400 Feheley Drive, King of Prussia, Pennsylvania 19406
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(Address of Principal Executive Offices) (Zip Code)
(610) 277-8300
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(Registrant's Telephone Number, Including Area Code)
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01 Entry into a Material Definitive Agreement.
On March 7, 2005, Neoware Systems, Inc. (the "Company") announced that on March
5, 2005 it entered into an Asset Purchase Agreement ("Agreement") with eSeSIX
Computer GmbH ("eSeSIX Computer"), based near Munich, Germany, and on March 4,
2005 it entered into a Share Purchase Agreement with eSeSIX
Information-Technologies, its development and engineering affiliate based in
Austria ("eSESIX Tech" and together with eSeSIX Computer, "eSeSIX"), to purchase
eSeSIX Computer's thin client assets and all of the shares of eSeSIX Tech (the
"Thintune Business") and that, pursuant to the Agreements, completed the
acquisition. The Agreements contained customary representations, warranties and
covenants. The Thintune Business acquired principally consisted of customer
lists, intellectual property, contract rights, goodwill, inventory and the
assumption of certain warranty obligations. As part of the transaction, the
Company also acquired non-competition agreements from eSeSIX Computer and its
principal shareholder and an agreement providing for eSeSIX Computer to serve as
a distributor of Neoware's Thintune and other thin client products in Central
Europe. The Company intends to use the Thintune Business acquired for purposes
similar to those of eSeSIX. The up front cash consideration paid by the Company
was EUR 6,830,000 ($9,112,000) in cash, EUR 673,077 ($898,000) of which is being
held in an escrow account for six months for indemnification claims, additional
cash payments for inventory of up to $660,000 and certain warranty liabilities
assumed of approximately $249,000, net of the value of related services to be
provided by eSeSIX. In addition, the Agreements specify a potential cash
earn-out of up to $1,550,000 based on defined revenues. The purchase price was
paid with cash on hand. The amount and type of consideration was determined on
the basis of arm's length negotiations between Neoware, eSeSIX Computer and the
shareholders of eSeSIX Tech. The Company is not assuming any of eSeSIX
Computer's debt or other liabilities, except for the warranty obligations
discussed above. Neither the Company nor any of its affiliates has any material
relationship to eSeSIX Computer, eSeSIX Tech or any of the shareholders of
eSeSIX other than in respect of the Agreements and the transactions
contemplated thereby.
The foregoing description of the Agreements and the transactions contemplated
thereby are qualified in their entirety by reference to the Asset Purchase
Agreement and the Share Purchase Agreement which are filed as Exhibits 2.1 and
2.2 hereto, respectively.
Item 2.01 Acquisition or Disposition of Assets.
The information set forth in Item 1.01 is hereby incorporated herein by
reference.
Item 9.01 Financial Statements and Exhibits.
(a) Financial Statements.
The Company is not required to file financial statements in connection with the
acquisition described in Items 1.01 and 2.01.
(b) Pro Forma financial information.
The Company is not required to file pro forma financial information in
connection with the acquisition described in Items 1.01 and 2.01.
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(c) Exhibits. The following documents are filed as exhibits to this report.
2.1 Asset Purchase Agreement between Neoware Systems, Inc., eSeSIX Computer
GmbH and Engelbert Tretter dated as of March 4, 2005. The Company
agrees to furnish supplementally a copy of any of the exhibits and
schedules to the Asset Purchase Agreement identified therein upon
request of the Securities and Exchange Commission.
2.2 Share Purchase Agreement between Neoware Systems Inc. and the
shareholders of eSeSIX Information-Technologies GmbH dated as of March
4, 2005. The Company agrees to furnish supplementally a copy of any of
the exhibits and schedules to the Share Purchase Agreement identified
therein upon request of the Securities and Exchange Commission.
99.1 Press Release dated March 7, 2005.
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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: March 10, 2005 Neoware Systems, Inc.
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(Registrant)
/s/ Keith D. Schneck
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Keith D. Schneck
Executive Vice President and
Chief Financial Officer