1
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 4, 2000
Concord Communications, Inc.
(Exact Name of Registrant as Specified in Charter)
Massachusetts 0-23067 04-2710876
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
600 Nickerson Road, Marlboro, Massachusetts 01752
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (508) 460-4646
2
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On February 4, 2000, Concord Communications, Inc. ("Concord") completed
its acquisition of all of the capital stock of FirstSense Software, Inc., a
Delaware corporation ("FirstSense"), by means of a merger (the "Merger") of F
Acquisition Corp., a Delaware corporation and wholly owned subsidiary of Concord
("Merger Sub"), with and into FirstSense, pursuant to the Agreement and Plan of
Reorganization dated as of January 20, 2000 (the "Merger Agreement") by and
among Concord, Merger Sub, and FirstSense. As a result of the Merger, FirstSense
became a wholly owned subsidiary of Concord and will continue to operate as a
wholly-owned subsidiary of Concord. The Merger was effected by the filing of a
Certificate of Merger with the Secretary of State of Delaware on February 4,
2000. FirstSense Software is a provider of applications performance and
service-level management software designed for distributed applications,
including packaged, custom and e-business applications.
Pursuant to the terms of the Merger Agreement, upon the effective time
of the Merger, each outstanding share of common stock of FirstSense was
converted into the right to receive approximately 0.15 shares (the "Applicable
Fraction") of Concord common stock (subject to payment of cash in lieu of any
fractional shares). Each holder of FirstSense common stock who is otherwise
entitled to a fraction of a share of Concord common stock will receive cash in
lieu thereof, equal to such fraction multiplied by $40.0876. As a result of the
Merger, upon the closing of the transaction on February 4, 2000, Concord issued
an aggregate of 1,673,990 shares of Concord common stock (the "Shares") and
$573.33 in cash in lieu of fractional shares of Concord common stock in exchange
for all of the outstanding shares of capital stock of FirstSense. In accordance
with the terms of the Merger Agreement and an Escrow Agreement dated February 4,
2000 by and among Concord, State Street Bank and Trust Company (as Escrow Agent)
and Timothy Barrows (as Securityholder Agent) (the "Escrow Agreement"), 167,418
of the Shares have been placed in an escrow account for a one-year period to
secure certain indemnification obligations of FirstSense under the Merger
Agreement. The Shares were issued in reliance on the exemption from registration
provided by Rule 506 of Regulation D under the Securities Act of 1933, as
amended.
Also, pursuant to the terms of the Merger Agreement, upon the effective
time of the Merger, Concord assumed FirstSense's obligations under the Mission
Systems, Incorporated 1996 Equity Incentive Stock Plan, and the FirstSense
Software, Inc. 1997 Stock Incentive Plan, and all stock options granted pursuant
to such plans, whether vested or unvested, outstanding as of the effective time
of the Merger. The number of shares of Concord common stock to be issued upon
exercise of any such stock option is determined by multiplying the number of
shares of FirstSense common stock underlying such option by the Applicable
Fraction (rounded down to the nearest whole share). The exercise price to be
paid upon any such exercise is determined by dividing the exercise price per
share of FirstSense common stock for such option by the Applicable Fraction
(rounded up to the nearest whole cent). Concord has reserved an additional
265,995 shares of Concord common stock for issuance upon exercise all such
outstanding options.
The purchase price and terms for the transaction were determined in
arms-length negotiations. The acquisition of FirstSense is intended to qualify a
tax-free reorganization under Section 368 of the Internal Revenue Code of 1986,
as amended. Concord will account for the transaction under the pooling of
interests method of accounting.
The terms of the Merger are more fully described in the Merger
Agreement and the Registration Rights Agreement, each filed herewith.
3
-3-
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Financial Statements of Business Acquired.
Pursuant to Instruction (a)(4) of Item 7 of Form 8-K, financial
statements of FirstSense Software, Inc. will be filed not later than 60 days
after February 19, 2000, the date that this initial report on Form 8-K must be
filed.
(b) Pro Forma Financial Information.
Pursuant to Instruction (b)(2) of Item 7 of Form 8-K, pro forma
financial information relating to FirstSense Software, Inc. will be filed not
later 60 days after February 19, 2000, the date that this initial report on Form
8-K must be filed.
(c) Exhibits.
2.1 Agreement and Plan of Reorganization dated as of January 20,
2000 by and among Concord Communications, Inc., F Acquisition
Corp., and FirstSense Software, Inc.
99.1 Registration Rights Agreement dated as of February 4, 2000 by
and among Concord Communications, Inc. and Timothy Barrows, as
Securityholder Agent
99.2 Press Release dated February 7, 2000
4
-4-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CONCORD COMMUNICATIONS, INC.
Dated: February 7, 2000
By: /s/ Gary E. Haroian
--------------------------------
Gary E. Haroian
Vice President of Finance
and Chief Financial Officer
5
-5-
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
2.1 Agreement and Plan of Reorganization dated as of January 20,
2000 by and among Concord Communications, Inc., F Acquisition
Corp., and FirstSense Software, Inc.
99.1 Registration Rights Agreement dated as of February 4, 2000 by
and among Concord Communications, Inc. and Timothy Barrows, as
Securityholder Agent
99.2 Press Release dated February 7, 2000