1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1 TO CURRENT REPORT
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
September 30, 1999
Brooks Automation, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
000-25434 04-3040660
(Commission File Number) (I.R.S. Employer Identification No.)
15 Elizabeth Drive, Chelmsford, MA 01824
(978) 262-2400
(Registrant's Telephone Number, Including Area Code)
2
The Undersigned Registrant hereby amends Item 7 of its Current Report
on Form 8-K dated September 30, 1999 to read in its entirety as follows:
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION, AND EXHIBITS
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED
Included with this report on Form 8-K are audited financial
statements for the years ended December 31, 1996, 1997 and
1998 as well as interim unaudited financial statements for the
six months ended June 30, 1998 and 1999, prepared in
accordance with generally accepted accounting principles in
Germany (German GAAP), as follows:
Report of Independent Auditors
Consolidated Balance Sheets as of December 31, 1997 and 1998
Consolidated Statements of Operations for the years ended
December 31, 1996, 1997 and 1998
Consolidated Statements of Cash Flows for the years ended
December 31, 1997 and 1998
Notes to the Consolidated Financial Statements
Fixed Asset Movement Schedules for the years ended December
31, 1997 and 1998
Reconciliation of Net Income to U.S. GAAP
Consolidated Balance Sheets as of December 31,
1998 and June 30, 1999 (unaudited)
Consolidated Statements of Operations for the six months ended
June 30, 1998 and 1999 (unaudited)
Consolidated Statements of Cash Flows for the six months ended
June 30, 1998 and 1999 (unaudited)
Notes to the Unaudited Consolidated Financial Statements
3
(b) PRO FORMA FINANCIAL INFORMATION
Unaudited Pro Forma Combined Condensed Balance Sheet as of
June 30, 1999
Unaudited Pro Forma Combined Condensed Statement of Operations
for the nine months ended June 30, 1999
Unaudited Pro Forma Combined Condensed Statement of Operations
for the year ended September 30, 1998
Notes to Unaudited Pro Forma Combined Condensed Financial
Statements
(c) EXHIBITS
Item No. Description
-------- -----------
*2.1 Master Purchase Agreement by and among Brooks
Automation, Inc., FASTech Integration, Inc., Brooks
Automation GmbH, Jenoptik AG, Meissner & Wurst
Zander Holding GmbH, Jenoptik Infab GmbH, Jenoptik
Infab KK, Jenoptik Infab PLC, Jenoptik Infab, Ltd.,
Meissner & Wurst US, Inc. and Jenoptik Infab, Inc.
dated as of September 9, 1999, as amended on
September 30, 1999.
*2.2 Stockholder Agreement dated September 30, 1999
among Brooks Automation, Inc., Jenoptik AG,
Meissner & Wurst Zander Holding GmbH and Robert J.
Therrien.
23.1 Consent of Ebner Stolz & Partner GmbH
- ----------------------------
* Previously filed
4
INFAB GROUP
Included with this Current Report on Form 8-K/A, Amendment No. 1, are audited
financial statements for the years ended December 31, 1996, 1997 and 1998 as
well as interim unaudited financial statements for the six months ended June 30,
1998 and 1999, in accordance with generally accepted accounting principles in
Germany (German GAAP), as follows:
Report of Independent Auditors 5
Consolidated Balance Sheets as of December 31, 1997 and 1998 6
Consolidated Statements of Operations for the years ended
December 31, 1996, 1997 and 1998 7
Consolidated Statements of Cash Flows for the years ended December 31, 1997
and 1998 8
Notes to the Consolidated Financial Statements 9-23
Fixed Asset Movement Schedules for the years ended
December 31, 1997 and 1998 24-25
Reconciliation of Net Income to U.S. GAAP 26
Consolidated Balance Sheets as of December 31, 1998 and June 30, 1999
(unaudited) 27
Consolidated Statements of Operations for the six months ended June 30, 1998
and 1999 (unaudited) 28
Consolidated Statements of Cash Flows for the six months ended June 30,
1998 and 1999 (unaudited) 29
Notes to the Unaudited Consolidated Financial Statements 30-38
5
Ebner Stolz & Partner
Report of Independent Auditors
To the Board of Management and
Shareholders of Infab Group
We have audited the consolidated balance sheets of INFAB group as of December
31, 1998 and 1997, the related consolidated statements of operations for the
three years ended December 31, 1998 and the related consolidated statements of
cash flows for the two years ended December 31, 1998. These financial statements
which have been prepared under German GAAP are the responsibility of the
company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of INFAB group as of
December 31, 1998 and 1997 and the results of its operations and cash flows for
the years then ended in conformity with generally accepted accounting
principles in Germany.
Stuttgart, December 13, 1999
Dr. Ebner, Dr. Stolz und Partner GmbH
Auditors
Tax Consultants
Dr. Wolfgang Russ
Auditor
Eberhard Poschke
Auditor
6
INFAB GROUP
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS OF DM)
DECEMBER 31, DECEMBER 31,
1997 1998
------------ ------------
ASSETS
Non-Current Assets
Intangible assets 1,193 1,012
Property, plant & equipment 5,041 5,332
Financial assets 22 153
------- -------
Total non-current assets 6,256 6,497
------- -------
Current Assets
Inventories 26,790 24,842
Receivables and other assets 34,393 19,150
Cash 1,561 444
------- -------
Total current assets 62,744 44,436
------- -------
Prepaid expenses 651 237
------- -------
Total assets 69,651 51,170
======= =======
SHAREHOLDER'S DEFICIT AND LIABILITIES
Shareholder's Deficit
Subscribed capital 5,010 5,011
Capital reserve 23,798 5,562
Accumulated loss brought forward (26,108) (47,479)
Cumulative loss in excess of equity 422 (489)
------- -------
Total shareholder's deficit 3,122 (37,395)
------- -------
Accruals
Tax accruals 984 1,623
Other accruals 20,642 10,801
------- -------
Total accruals 21,626 12,424
------- -------
Liabilities
Trade payable 6,692 5,100
Liabilities to Banks -- 214
Liabilities on bills accepted and drawn 176 2
Payable to affiliated companies 36,623 67,198
Other liabilities 1,412 3,354
------- -------
Total liabilities 44,903 75,868
------- -------
Deferred Income -- 273
------- -------
Total shareholder's deficit and liabilities 69,651 51,170
======= =======
The accompanying notes are an integral part of the consolidated financial
statements.
7
INFAB GROUP
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS OF DM)
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1996 1997 1998
------------ ------------ ------------
Sales 66,821 111,527 60,424
Cost of sales 53,430 87,838 55,873
-------- -------- --------
Gross profit 13,391 23,689 4,551
-------- -------- --------
Other operating income 4,355 5,972 4,764
Interest income -- 34 9
-------- -------- --------
Total other income 4,355 6,006 4,773
-------- -------- --------
Selling expenses 12,189 16,033 16,787
General administration expenses 8,479 18,971 16,875
Research and development expenses 9,326 8,719 7,981
Other operating expenses 2,326 1,335 2,770
Interest expense 476 529 1,892
-------- -------- --------
Result of ordinary activities (15,050) (15,892) (36,981)
Extraordinary income 10,510 5,130 15,000
Deferred taxes 74 (100) --
Other taxes 13 970 (1)
-------- -------- --------
Net loss for the year before minority interest (4,627) (11,632) (21,980)
Minority interest on net income for the year 630 (141) 420
-------- -------- --------
Net loss for the year (3,997) (11,773) (21,560)
======== ======== ========
The accompanying notes are an integral part of the consolidated financial
statements.
8
INFAB GROUP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS OF DM)
Year ended December 31,
1997 1998
Cash flows from operating activities:
Net loss (11,773) (21,560)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 2,089 2,915
(Gain) loss on disposal of fixed assets 22 (37)
Minority interest 141 (420)
(Increase) decrease in inventories (6,373) 1,948
(Increase) decrease in receivables and other assets (11,104) 15,243
(Increase) decrease in prepaid expenses (341) 414
Increase in tax accruals 984 639
Increase (decrease) in other accruals 11,545 (9,841)
Increase (decrease) in trade payables 1,972 (1,592)
Increase (decrease) in other liabilities (972) 1,942
Increase in deferred revenue -- 273
------- -------
Cash used in operating activities (13,810) (10,076)
------- -------
Cash flows used in investing activities:
Purchase of financial assets -- (131)
Proceeds from sales of fixed assets 470 600
Capital expenditures (4,657) (3,585)
Acquisition of Cimple -- (18,540)
------- -------
Cash used in investing activities (4,187) (21,656)
------- -------
Cash flows provided by financing activities:
Net proceeds (repayment) of financial liabilities to banks 176 40
Increase in liabilities to affiliated companies 18,599 30,575
------- -------
Cash provided by financing activities 18,775 30,615
------- -------
Net increase (decrease) in cash 778 (1,117)
Cash at beginning of year 783 1,561
------- -------
Cash at end of year 1,561 444
======= =======
The accompanying notes are an integral part of the financial statements.
9
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS OF THE INFAB GROUP
I. SCOPE OF CONSOLIDATION
1998
In addition to JENOPTIK INFAB GmbH, Jena, the following companies were
consolidated:
Company name and registered office Currency Nominal Participation
capital quota
%
- -----------------------------------------------------------------------------------------------
JENOPTIK INFAB plc., Galway/Ireland IEP 30.00 80,0
JENOPTIK INFAB Ltd., Livingston/Scotland USD 51.00 80,0
JENOPTIK INFAB INC., Austin/USA USD 6.75 100,0
The companies JENOPTIK INFAB INTRAK, INC., Colorado Springs/USA, and
JENOPTIK INFAB Software, Inc., Winter Park/USA, were merged into
JENOPTIK INFAB INC., Austin/USA during 1998.
The following company was not included in the scope of consolidation
for the consolidated financial statements:
Company name and registered office Currency Nominal Participation
capital quota
%
- -----------------------------------------------------------------------------------------------
JENOPTIK INFAB KK, Yokohama/Japan JPY 10.00 100,0
The Infab group is not obliged to prepare consolidated financial
statements as JENOPTIK AG, JENA, as the umbrella parent company,
prepares consolidated financial statements with a discharging effect
pursuant to Section 291 HGB [German Commercial Code]. The relationship
between JENOPTIK INFAB GmbH, Jena, and JENOPTIK INFAB, INC., Austin/USA
is not that between a parent company and a subsidiary as shares are
indirectly held by M+W Zander Facility Engineering GmbH + Co. KG,
Stuttgart.
JENOPTIK INFAB plc., Galway/Ireland and JENOPTIK INFAB Ltd.,
Livingston/Scotland were consolidated for the first time. As a
consequence of the changes in the scope of consolidation, sales
increased by KDM 3.478 and the profit for the year was reduced by KDM
2.101.
JENOPTIK INFAB KK, Yokohama/Japan was founded in 1998. Due to its
subordinate importance, its inclusion in the scope of consolidation was
dispensed with pursuant to Section 296 para. 2 HGB [German Commercial
Code].
10
1997
In addition to JENOPTIK INFAB GmbH, Jena, the following companies were
consolidated:
Company name and registered office Currency Nominal Participation
capital quota
%
- -------------------------------------------------------------------------------------
JENOPTIK INFAB, INC., Austin/USA USD 1.00 100,0
JENOPTIK INFAB INTRAK, INC.,
Colorado Springs/USA USD 1.00 100,0
JENOPTIK INFAB Software, INC.,
Winter Park/USA USD 4.75 88,9
The following company was not included in the scope of consolidation
for the consolidated financial statements:
Company name and registered office Currency Nominal Participation
capital quota
%
- -------------------------------------------------------------------------------------
JENOPTIK INFAB UK LIMITED,
Swindon/Great Britain GBP 10.00 100,0
Shares in the companies included in the scope of consolidation are
directly or indirectly held by M+W Zander Facility Engineering GmbH +
Co. KG, Stuttgart. The Infab group is not obliged to prepare
consolidated statements as the relationship between the companies
included in the scope of consolidation is not that between a parent
company and a subsidiary. Furthermore, a duty to prepare consolidated
accounting does not exist as JENOPTIK AG, JENA, as the umbrella parent
company, prepares consolidated financial statements with a discharging
effect pursuant to Section 291 HGB [German Commercial Code].
JENOPTIK INFAB INC., Austin/USA, was consolidated for the first time.
As a consequence of the changes in the scope of consolidation, sales
increased by KDM 14.052 and the profit for the year was reduced by KDM
6.288.
JENOPTIK INFAB UK LIMITED, Swindon/Great Britain, was founded in 1996.
Due to its subordinate significance, its inclusion in the scope of
consolidation was dispensed with pursuant to Section 296 para. 2 HGB
[German Commercial Code].
11
1996
In addition to JENOPTIK INFAB GmbH, Jena, the following companies were
consolidated:
Company name and registered office Currency Nominal Participation
capital quota
%
- ---------------------------------------------------------------------------------------------------
EMTRAK, INC. (from 1997: JENOPTIK INFAB
INTRAK, INC.), Colorado Springs/USA USD 1.00 85,0
PRAXIS TECHNOLOGIES, INC. (from 1997:
JENOPTIK INFAB Software, INC.),
Austin/USA USD 3.85 66,2
The following companies were not included in the scope of consolidation
for the consolidated financial statements:
Company name and registered office Currency Nominal Participation
capital quota
%
- ------------------------------------------------------------------------------------------------------
JENOPTIK INFAB, INC., Austin/USA USD 1.00 100,0
JENOPTIK INFAB UK LIMITED,
Swindon/Great Britain GBP 10.00 100,0
Holdings in the companies included in the scope of consolidation are
directly or indirectly held by M+W Zander Facility Engineering GmbH +
Co. KG, Stuttgart. The Infab group is not obliged to prepare
consolidated financial statements as the relationship between the
companies included in the scope of consolidation and the company is not
that between subsidiaries and the parent company. In addition, it is
not obliged to prepare consolidated financial statements as JENOPTIK
AG, JENA, as the umbrella parent company prepares consolidated
financial statements with a discharging effect pursuant to Section 291
HGB [German Commercial Code].
JENOPTIK INFAB INC., Austin/USA was founded in 1996. In the year of
foundation, combined financial statements were prepared together with
MEISSNER & WURST GmbH & Co., U.S. OPERATIONS, INC., Anaheim/USA. The
notes required for including the companies in the scope of
consolidation for the consolidated financial statements could not be
determined without incurring disproportionately high costs or delays.
Their inclusion in the scope of consolidation was therefore dispensed
with pursuant to Section 296 para. 1 No. 2 HGB [German Commercial
Code].
JENOPTIK INFAB UK LIMITED, Swindon/Great Britain was also founded in
1996. Due to the company's subordinate significance, its inclusion in
the scope of consolidation was dispensed with pursuant to Section 296
para. 2 HGB [German Commercial Code].
12
II. CURRENCY TRANSLATION, PRINCIPLES OF CONSOLIDATION
The balance-sheet date for individual financial statements as well as
for consolidated financial statements for companies included in the
scope of consolidation is 31st December 1998, 1997 and 1996.
Individual statements were initially prepared subject to the provisions
of the respective national accounting principles. Combined INFAB Ltd. +
plc. financial statements denominated in USD were prepared for JENOPTIK
INFAB plc., Galway/Ireland and JENOPTIK INFAB Ltd.,
Livingston/Scotland.
To the extent that these provisions deviate from statutory provisions
relating to the make-up of balance sheets pursuant to HGB [German
Commercial Code], financial statements prepared according to foreign
law were brought in line with legal requirements for the classification
of financial statements and standards of valuation pursuant to HGB
[German Commercial Code].
For the purpose of the calculation of equity capital (excluding profit
for the year), USD denominated amounts for companies abroad were
uniformly translated at historic exchange rates, the profit/loss for
the year was uniformly translated at the weighted average rate (based
on sales) and all other items on the balance sheet were uniformly
translated at the mean of buying and selling foreign-exchange rate
applicable on the balance-sheet date. Incongruences between foreign
currencies resulting therefrom were offset against reserves without
affecting the operating result.
The items on the profit and loss account were either translated at the
weighted average rate or at the mean of buying and selling
foreign-exchange rate applicable on the balance-sheet date.
Individual financial statements brought in line with German law were
combined into consolidated financial statements subject to the
application of the following measures:
Capital consolidation was carried out according to the book-value
method pursuant to Section 301 para. 1 sub-para. 2 No. 1 HGB [German
Commercial Code]. As far as initial consolidation is concerned, the
subsidiary's equity capital at that time is offset against the book
value of the holding of the parent company. Capital consolidation was
carried out at the time of acquisition of shares.
Initial consolidation resulted in a credit balance in the amount of KDM
18.540 treated as goodwill which was openly offset against the capital
reserve pursuant to Section 309 para. 1 HGB [German Commercial Code].
Intra-group accounts receivable and accounts payable were offset within
the framework of debt consolidation.
All intra-group sales and other intra-group income and expense items
were consolidated in full in the consolidated profit and loss account.
Unrealised results of intra-group trade transactions did not have to be
eliminated.
Tax accrual and deferral based on consolidation measures pursuant to
Section 306 HGB [German Commercial Code] was dispensed with as
significant income tax loss carried forward exists. Deferred taxes
based on income tax loss carried forward must not be charged to
subsequent accounting years according to German law.
13
III. ACCOUNTING PRINCIPLES AND STANDARDS OF VALUATION
A S S E T S
INTANGIBLE ASSETS
Intangible assets were reported at acquisition cost minus scheduled
accumulated depreciation.
Depreciation is carried into effect on a pro rata temporis basis over
the usual useful life of an asset in the company according to the
straight-line method of depreciation.
TANGIBLE ASSETS
Tangible assets are reported at acquisition or production costs minus
scheduled accumulated depreciation.
Depreciation is carried into effect over the usual useful life of an
asset in the company according to the straight-line method of
depreciation.
Pursuant to Section 6 para. 2 EStG [Income Tax Law], depreciable
movable fixed assets of low value acquired by JENOPTIK INFAB GmbH, Jena
were depreciated in full in the year of addition.
FINANCIAL ASSETS
Holdings in associated companies were reported at acquisition cost.
INVENTORIES
On principle, raw materials and supplies were reported at the average
acquisition cost and/or lower current market value.
The valuation of work in progress and finished goods and merchandise
was based on production costs adopted from corporate accounting.
Production costs include cost of direct material and materials handling
overhead, prime cost and indirect manufacturing overhead as well as
special production costs (e. g. cost of tools).
The determined amounts reported as production cost for work in progress
made to order were retrospectively audited for the purpose of loss-free
reporting.
Necessary and adequate provisions for slow-moving materials were made
concerning raw materials and supplies and finished goods and
merchandise to take insufficient demand or lack of marketability as per
the balance-sheet date into account.
14
ACCOUNTS RECEIVABLE AND OTHER ASSETS
Recognisable individual risks concerning accounts receivable and other
assets were taken into account by means of valuation adjustments. On
principle, the calculated lump-sum valuation adjustment on trade
receivables was 1% of the respective net accounts receivable.
Foreign-currency accounts receivable were valued at the rate applicable
on the day of creation of the accounts receivable or at the lower
buying rate applicable on the balance-sheet date.
Accounts receivable and other assets were otherwise reported at nominal
values.
E Q U I T Y A N D L I A B I L I T I E S
ACCRUALS
The provisions for taxation and other accruals items take account of
all recognisable risks and contingent liabilities and were valued with
the due diligence of a prudent businessman.
LIABILITIES
All liabilities were valued at the amount repayable.
15
IV. EXPLANATORY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FIXED ASSETS
The fixed-assets movement schedules which have been specially prepared
are incorporated by reference into the notes.
INVENTORIES
Apart from the retention of titles to ownership common in the industry,
inventories are not subject to third-party rights.
RECEIVABLES FROM AFFILIATED COMPANIES
M+W Zander Facility Engineering GmbH + Co. KG, Stuttgart, the sole
shareholder, accounts for KDM 441 and KDM 1.985 of receivables from
affiliated companies at December 31, 1998 and 1997.
OTHER ASSETS
The other assets item includes KDM 67 with a remaining term to maturity
of more than one year at December 31, 1998 and 1997.
ACCRUALS
The other accruals item essentially includes follow-up costs for
invoiced orders, warranty obligations, outstanding supplier invoices
and provisions for staff obligations (holiday entitlements,
profit-sharing boni, anniversary obligations).
LIABILITIES
The liabilities item exclusively contains accounts payable due within
one year.
Titles for delivered objects covered by the trade payables item were
retained to the extent common in the industry.
The payables to affiliated companies item includes accounts payable to
M+W Zander Facility Engineering GmbH + Co. KG, Stuttgart, the sole
shareholder, in the amount of KDM 783 at December 31, 1998.
The other liabilities item is made up as follows 1998:
31/12/1998
KDM
----------
Accounts payable for taxes 226
Accounts payable for
social insurance contributions 414
Other accounts payable 2.714
-----
3.354
=====
16
The other liabilities item is made up as follows 1997:
31/12/1997
KDM
----------
Accounts payable for taxes 253
Accounts payable for
social insurance contributions 392
Other accounts payable 767
-----
1.412
=====
17
V. EXPLANATORY NOTES TO THE CONSOLIDATED PROFIT AND LOSS ACCOUNT
The profit and loss account is structured according to cost of sales type of
short-term results accounting.
"Research and development expenses" were added to the profit and loss account as
an additional item to the statutory accounting format.
1998 SALES
Sales are made up as follows:
1998
KDM
----
Domestic sales 10.439
Foreign sales 49.985
------
60.424
======
BELOW-THE-LINE ITEMS
The other operating income item includes below-the-line items in the amount of
KDM 1.165. This income unrelated to the accounting period is made up of income
from the amortisation of accruals and valuation adjustments.
PERSONNEL EXPENSES
Personnel expenses in the financial year totalled KDM 40.684.
BELOW-THE-LINE ITEMS
The other operating expenses item includes below-the-line items in the amount of
KDM 77. This expense item unrelated to the accounting period is made up of the
disposal of fixed assets.
AFFILIATED COMPANIES
The interest and similar expenses item includes interest and similar expenses
from affiliated companies in the amount of KDM 1.869.
EXTRAORDINARY INCOME
The extraordinary income item refers to income contributions by JENOPTIK AG,
Jena.
18
1997 SALES
Sales are made up as follows:
1997
KDM
------
Domestic sales 14.654
Foreign sales 96.873
-------
111.527
=======
BELOW-THE-LINE ITEMS
The other operating income item includes below-the-line items in the amount of
KDM 552. This income unrelated to the accounting period is made up of income
from the amortisation of accruals, valuation adjustments and currency profits.
PERSONNEL EXPENSES
Personnel expenses in the financial year totalled KDM 33.042.
BELOW-THE-LINE ITEMS
The other operating expenses item includes below-the-line items in the amount of
KDM 62. This expense item unrelated to the accounting period is made up of the
disposal of fixed assets and currency losses.
AFFILIATED COMPANIES
The interest and similar expenses item includes interest and similar expenses
from affiliated companies in the amount of KDM 472.
EXTRAORDINARY INCOME
The extraordinary income item refers to income contributions by JENOPTIK AG,
Jena.
19
1996 SALES
Sales are made up as follows:
1996
KDM
------
Domestic sales 31.494
Foreign sales 35.327
------
66.821
======
BELOW-THE-LINE ITEMS
The other operating income item includes below-the-line items in the amount of
KDM 771. This income unrelated to the accounting period is made up of income
from the amortisation of accruals and valuation adjustments.
PERSONNEL EXPENSES
Personnel expenses in the financial year totalled KDM 22.944.
BELOW-THE-LINE ITEMS
The other operating expenses item includes below-the-line items in the amount of
KDM 494. This expense item unrelated to the accounting period is made up of the
disposal of fixed assets.
AFFILIATED COMPANIES
The interest and similar expenses item includes interest and similar expenses
from affiliated companies in the amount of KDM 447.
EXTRAORDINARY INCOME
The extraordinary income item refers to income contributions by JENOPTIK AG,
Jena.
20
VI. CONTINGENCIES AND OTHER FINANCIAL OBLIGATIONS
1998
1. Liabilities on guarantees total KDM 2.808.
2. Other financial obligations are made up as follows:
Due Due Total
1999 2000 - 2003
KDM KDM KDM
--- --- ---
Renting and leasing obligations 1.472 589 2.061
Other obligations 792 0 792
----- --- -----
2.264 589 2.853
===== === =====
Affiliated companies account of KDM 980 of other financial obligations.
1997
1. As at the balance-sheet date, contingencies resulting from the issue and
transfer of bills totalled KDM 13.000. These accounts are payable to
affiliated companies.
2. Other financial obligations are made up as follows:
Due Due Total
1998 1999 - 2002
KDM KDM KDM
----- ----------- -----
Renting and leasing obligations 2.124 1.272 3.396
Other obligations 1.718 0 1.718
----- ----- -----
3.842 1.272 5.114
===== ===== =====
Affiliated companies account for KDM 2.157 of other financial obligations.
21
VII. OTHER STATEMENTS
1998
1. The following gentlemen are or were appointed as members of the
Board of Management of JENOPTIK INFAB GmbH, Jena:
Karl-Heinz Kuch, Wogau (until 1st July 1998),
Dr. Rudolf Simon, Korntal-Munchingen (until 15th September 1998),
Wolfgang Mayr, Koestenberg/Austria (from 15th September 1998),
Reimund Blessing, Vaihingen/Enz (from 1st July 1998), and
Heinz Daugert, Lachendorf (from 15th September 1998).
2. In the reporting year, the Supervisory Board of JENOPTIK INFAB
GmbH, Jena, was made up of the following gentlemen:
Jurgen Giessmann, Ludwigsburg-Neckarweihingen (chairman),
Helmut Laub, Stuttgart,
Thomas Anger, Isserstedt, and
Siegfried Benno Jaschke, Erfurt.
3. In the reporting year, the emoluments paid to the members of the
Board of Management totalled KDM 400. The emoluments paid to the
Supervisory Board amounted to KDM 30.
4. In the reporting year, the group companies employed 343 members of
staff. Staff figures are made up as follows:
Members of
staff
----------
Industrial workers 22
Salaried employees 321
---
343
===
5. Infab group companies are included in the consolidated financial
statements of JENOPTIK AG, Jena. A duty to prepare consolidated
financial statements does not exist as the consolidated financial
statements of JENOPTIK AG, Jena, have a discharging effect. The
consolidated financial statements of JENOPTIK AG, Jena, are
deposited with the commercial register of the Local Court of Gera.
Stuttgart, 5th October 1999
JENOPTIK INFAB GmbH
The Board of Management
22
1997
1. The following gentlemen were appointed as managing directors of
JENOPTIK INFAB GmbH, Jena:
Karl-Heinz Kuch, Wogau, and
Dr. Rudolf Simon, Korntal-Munchingen.
2. In the reporting year, the following gentlemen were members of the
Supervisory Board of JENOPTIK INFAB GmbH, Jena:
Dr. Lothar Spath, Gerlingen (chairman),
Jurgen Giessmann, Ludwigsburg-Neckarweihingen,
Helmut Laub, Stuttgart,
Thomas Anger, Isserstedt, and
Siegfried Benno Jaschke, Erfurt.
3. In the reporting year, the emoluments of the members of the Board
of Management totalled KDM 611. The emoluments of the members of
the supervisory board amounted to KDM 72.
4. In the reporting year, the group companies employed 311 members of
staff. Staff figures are made up as follows:
Members of
staff
----------
Industrial workers 18
Salaried employees 293
---
311
===
5. Infab group companies are included in the scope of consolidation
for the consolidated financial statements of JENOPTIK AG, Jena. A
duty to prepare consolidated financial statements does not exist as
the consolidated financial statements prepared by JENOPTIK AG,
Jena, have a discharging effect. The consolidated financial
statements of JENOPTIK AG, Jena, are deposited with the commercial
register of the Local Court of Gera.
Stuttgart, 5th October 1999
JENOPTIK INFAB GmbH
The Board of Management
23
1996
1. The following gentlemen were appointed as managing directors of
JENOPTIK INFAB GmbH, Jena:
Karl-Heinz Kuch, Wogau, and
Dr. Rudolf Simon, Korntal-Munchingen.
2. In the reporting year, the following gentlemen were members of the
Supervisory Board of JENOPTIK INFAB GmbH, Jena:
Dr. Lothar Spath, Gerlingen (chairman),
Jurgen Giessmann, Ludwigsburg-Neckarweihingen,
Helmut Laub, Stuttgart,
Thomas Anger, Isserstedt, and
Siegfried Benno Jaschke, Erfurt.
3. In the reporting year, the emoluments of the members of the Board
of Management totalled KDM 424. The emoluments of the members of
the supervisory board amounted to KDM 65.
4. In the reporting year, the group companies employed 249 members of
staff. Staff figures are made up as follows:
Members of
staff
----------
Industrial workers 18
Salaried employees 231
---
249
===
5. Infab group companies are included in the scope of consolidation
for the consolidated financial statements of JENOPTIK AG, Jena. A
duty to prepare consolidated financial statements does not exist as
the consolidated financial statements prepared by JENOPTIK AG,
Jena, have a discharging effect. The consolidated financial
statements of JENOPTIK AG, Jena, are deposited with the commercial
register of the Local Court of Gera.
Stuttgart, 5th October 1999
JENOPTIK INFAB GmbH
The Board of Management
24
FIXED ASSETS MOVEMENT SCHEDULE OF INFAB GROUP,
FOR FISCAL 1997
PURCHASE AND MANUFACTURING COSTS
Status on Currency Additions Disposals Transfers Status on
Jan/ 1, 1997 Differences Dec/ 31, 1997
KDM KDM KDM KDM KDM KDM
--------------------------------------------------------------------------------------
I. INTANGIBLE ASSETS
Industrial and similar rights
and assets 823 36 1,246 108 0 1,997
--------------------------------------------------------------------------------------
II. TANGIBLE ASSETS
1. Technical equipment and machines 102 0 0 4 0 98
2. Other equipment, factory and
office equipment 5,981 400 3,519 1,048 846 9,698
- -. Payments on accounts and assets
under construction 846 0 0 0 -846 0
--------------------------------------------------------------------------------------
6,929 400 3,519 1,052 0 9,796
--------------------------------------------------------------------------------------
III. FINANCIAL ASSETS
Shares in affiliated companies 22 0 0 0 0 22
--------------------------------------------------------------------------------------
7,774 436 4,765 1,160 0 11,815
======================================================================================
ACCUMULATED DEPRECIATION
Status on Currency Additions Disposals Status on
Jan/ 1, 1997 Differences Dec/ 31, 1997
KDM KDM KDM KDM KDM
--------------------------------------------------------------------------
I. INTANGIBLE ASSETS
Industrial and similar rights
and assets 496 4 343 39 804
--------------------------------------------------------------------------
II. TANGIBLE ASSETS
1. Technical equipment and machines 62 0 9 4 67
2. Other equipment, factory and
office equipment 3,036 104 2,104 556 4,688
- -. Payments on accounts and assets
under construction 0 0 0 0 0
--------------------------------------------------------------------------
3,098 104 2,113 560 4,755
--------------------------------------------------------------------------
III. FINANCIAL ASSETS
Shares in affiliated companies 0 0 0 0 0
--------------------------------------------------------------------------
3,594 108 2,456 599 5,559
==========================================================================
NET BOOK VALUE
Status on Status on
Dec/ 31, 1997 Dec/ 31, 1996
KDM KDM
---------------------------------
I. INTANGIBLE ASSETS
Industrial and similar rights
and assets 1,193 327
---------------------------------
II. TANGIBLE ASSETS
1. Technical equipment and machines 31 40
2. Other equipment, factory and
office equipment 5,010 2,945
- -. Payments on accounts and assets
under construction 0 846
---------------------------------
5,041 3,831
---------------------------------
III. FINANCIAL ASSETS
Shares in affiliated companies 22 22
---------------------------------
6,256 4,180
=================================
25
FIXED ASSETS MOVEMENT SCHEDULE OF INFAB GROUP,
FOR FISCAL 1998
PURCHASE AND MANUFACTURING COSTS
Status on Currency Additions Disposals Status on
Jan/ 1, 1998 Differences Dec/ 31, 1998
KDM KDM KDM KDM KDM
---------------------------------------------------------------------------
I. INTANGIBLE ASSETS
Industrial and similar rights and
assets 1,997 -17 229 0 2,209
---------------------------------------------------------------------------
II. TANGIBLE ASSETS
1. Technical equipment and machines 98 0 0 53 45
2. Other equipment, factory and
office equipment 9,698 -298 3,359 799 11,960
---------------------------------------------------------------------------
9,796 -298 3,359 852 12,005
---------------------------------------------------------------------------
III. FINANCIAL ASSETS
Shares in affiliated companies 22 0 153 22 153
---------------------------------------------------------------------------
11,815 -315 3,741 874 14,367
===========================================================================
ACCUMULATED DEPRECIATION
Status on Currency Additions Disposals Status on
Jan/ 1, 1998 Differences Dec/ 31, 1998
KDM KDM KDM KDM KDM
-------------------------------------------------------------------------
I. INTANGIBLE ASSETS
Industrial and similar rights and
assets 804 -6 399 0 1,197
-------------------------------------------------------------------------
II. TANGIBLE ASSETS
1. Technical equipment and machines 67 0 9 49 27
2. Other equipment, factory and
office equipment 4,688 -151 2,349 240 6,646
-------------------------------------------------------------------------
4,755 -151 2,358 289 6,673
-------------------------------------------------------------------------
III. FINANCIAL ASSETS
Shares in affiliated companies 0 0 0 0 0
-------------------------------------------------------------------------
5,559 -157 2,757 289 7,870
=========================================================================
NET BOOK VALUE
Status on Status on
Dec/ 31, 1998 Dec/ 31, 1997
KDM KDM
--------------------------------
I. INTANGIBLE ASSETS
Industrial and similar rights and
assets 1,012 1,193
--------------------------------
II. TANGIBLE ASSETS
1. Technical equipment and machines 18 31
2. Other equipment, factory and
office equipment 5,314 5,010
--------------------------------
5,332 5,041
--------------------------------
III. FINANCIAL ASSETS
Shares in affiliated companies 153 22
--------------------------------
6,497 6,256
================================
26
RECONCILIATION OF INFAB GROUP NET INCOME TO U.S. GAAP
The Company's Financial Statements have been prepared in accordance with the
German Commercial Code which represents generally accepted accounting principles
in Germany ("German GAAP"). German GAAP differs in certain significant respects
from United States generally accepted accounting principles ("U.S. GAAP"). The
following is a reconciliation of the significant adjustments necessary to
reconcile net loss in accordance with U.S. GAAP to the amounts determined under
German GAAP, for the years ended December 31, 1997 and 1998.
Year ended December 31,
1997 1998
---- ----
Net loss as reported in the consolidated statement of operations
Under German GAAP ............................................ (11,773) (21,560)
Amortization of step-up - Purchase of CIMPLE ................... -- (3,090)
Elimination of extraordinary income ............................ (5,130) (15,000)
Percentage-of-completion vs completed contract accounting ...... 811 (1,074)
------- -------
Net loss in accordance with U.S. GAAP .......................... (16,092) (40,724)
------- -------
A brief explanation of the most significant differences follows.
(a) Amortization of step-up
The acquisition of CIMPLE in March 1998, for an amount greater than the
fair value of CIMPLE's net assets at the date of acquisition, did not
result in the recording of intangible assets for German GAAP purposes,
rather, the excess amount was recorded as a charge to capital reserve.
For U.S. GAAP purposes the purchase price paid has been allocated to
the fair value of the assets and liabilities acquired. The excess of
the price paid over the fair value of the assets and liabilities
acquired has been allocated to goodwill and is being amortized over
five years.
(b) Elimination of extraordinary income.
Under German GAAP, certain capital contributions made by JENOPTIK AG,
JENA are recorded as extraordinary gains in the statement of
operations. Under U.S. GAAP, such amounts are recorded directly to
stockholder's equity.
(c) Contract accounting
The Company accounts for long duration contracts on the completed
contract method of accounting in accordance with German GAAP. Under
U.S. GAAP, such contracts are accounted for on the
percentage-of-completion method.
27
INFAB GROUP
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS OF DM)
DECEMBER 31, JUNE 30,
1998 1999
---- ----
(UNAUDITED)
ASSETS
Non-Current Assets
Intangible assets 1,012 854
Property, plant & equipment 5,332 5,052
Financial assets 153 153
------- -------
Total non-current assets 6,497 6,059
------- -------
Current Assets
Inventories 24,842 24,388
Receivables and other assets 19,150 19,540
Cash 444 936
------- -------
Total current assets 44,436 44,864
------- -------
Prepaid expenses 237 390
------- -------
Total assets 51,170 51,313
======= =======
SHAREHOLDER'S DEFICIT AND LIABILITIES
Shareholder's Deficit
Subscribed capital 5,011 5,011
Capital reserve 5,562 3,444
Accumulated loss brought forward (47,479) (61,768)
Cumulative loss in excess of equity (489) (1,022)
------- -------
Total shareholder's deficit (37,395) (54,335)
------- -------
Accruals
Tax accruals 1,623 1,775
Other accruals 10,801 8,149
------- -------
Total accruals 12,424 9,924
------- -------
Liabilities
Trade payable 5,100 1,811
Liabilities to Banks 214 --
Liabilities on bills accepted and drawn 2 --
Payable to affiliated companies 67,198 91,185
Other liabilities 3,354 2,444
------- -------
Total liabilities 75,868 95,440
------- -------
Deferred Income 273 284
------- -------
Total shareholder's deficit and liabilities 51,170 51,313
======= =======
The accompanying notes are an integral part of the consolidated financial
statements.
28
INFAB GROUP
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS OF DM)
SIX MONTHS ENDED
JUNE 30, JUNE 30,
1998 1999
---- ----
(UNAUDITED) (UNAUDITED)
Sales 38,347 12,670
Cost of sales 31,765 13,250
------- -------
Gross profit 6,582 (580)
------- -------
Other operating income 1,100 1,578
Interest income 3 9
------- -------
Total other income 1,103 1,587
------- -------
Selling expenses 9,366 6,572
General administration expenses 7,583 3,986
Research and development expenses 4,436 3,812
Other operating expenses 1,064 132
Amortization of financial assets -- 137
Interest expense 757 1,149
------- -------
Result of ordinary activities (15,521) (14,781)
Other taxes 1 41
------- -------
Net loss for the period before
minority interest (15,522) (14,822)
Minority interest on net income for the period 241 533
------- -------
Net loss for the period (15,281) (14,289)
======= =======
The accompanying notes are an integral part of the consolidated financial
statements.
29
INFAB GROUP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS OF DM)
Six months ended June 30,
-------------------------
1998 1999
------- -------
(Unaudited) (Unaudited)
Cash flows from operating activities:
Net loss (15,281) (14,289)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 1,511 1,662
Minority interest (241) (533)
(Increase) decrease in inventories (5,129) 454
Increase in receivables and other assets (5,152) (390)
Increase in prepaid expenses (178) (153)
Increase in tax accruals 1,188 152
Decrease in other accruals (3,232) (2,652)
Increase (decrease) in trade payables 11,022 (3,289)
Increase (decrease) in other liabilities 4,815 (910)
Increase in deferred revenue 1,691 11
------- -------
Cash used in operating activities (8,986) (19,937)
------- -------
Cash flows used in investing activities:
Purchase of financial assets (95) --
Capital expenditures (3,070) (1,224)
Acquisition of Cimple (18,540) --
------- -------
Cash used in investing activities (21,705) (1,224)
------- -------
Cash flows provided by financing activities:
Net repayment of financial liabilities to banks (2) (216)
Increase in liabilities to affiliated companies 29,823 21,869
------- -------
Cash provided by financing activities 29,821 21,653
------- -------
Net increase (decrease) in cash (870) 492
Cash at beginning of period 1,561 444
------- -------
Cash at end of period 691 936
======= =======
The accompanying notes are an integral part of the financial statements.
30
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS OF THE INFAB GROUP
FOR THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
I. SCOPE OF CONSOLIDATION
1999
In addition to JENOPTIK INFAB GmbH, Jena, the following companies were
consolidated:
Company name and registered office Currency Nominal Participation
capital quota
%
------------------------------------------------------------------------------------------------------------
JENOPTIK INFAB plc., Galway/Ireland IEP 30.000,00 80,0
JENOPTIK INFAB Ltd., Livingston/Scotland USD 51.000,00 80,0
JENOPTIK INFAB INC., Austin/USA USD 6.750,00 100,0
The following company was not included in the scope of consolidation
for the consolidated financial statements:
Company name and registered office Currency Nominal Participation
capital quota
%
--------------------------------------------------------------------------------------------------------------
JENOPTIK INFAB KK, Yokohama/Japan JPY 10.000.000,00 100,0
The Infab group is not obliged to prepare consolidated financial
statements as JENOPTIK AG, JENA, as the umbrella parent company,
prepares consolidated financial statements with a discharging effect
pursuant to Section 291 HGB [German Commercial Code]. The relationship
between JENOPTIK INFAB GmbH, Jena, and JENOPTIK INFAB, INC., Austin/USA
is not that between a parent company and a subsidiary as shares are
indirectly held by M+W Zander Facility Engineering GmbH + Co. KG,
Stuttgart. In addition, it is not obliged by law to prepare interim
financial statements during the financial year.
JENOPTIK INFAB KK, Yokohama/Japan was founded in 1998. Its inclusion in
the scope of consolidation was dispensed with pursuant to Section 296
para. 2 HGB [German Commercial Code] due to its subordinate
significance.
31
I. SCOPE OF CONSOLIDATION
1998
In addition to JENOPTIK INFAB GmbH, Jena, the following companies were
consolidated:
Company name and registered office Currency Nominal Participation
capital quota
%
-----------------------------------------------------------------------------------------------------
JENOPTIK INFAB plc., Galway/Ireland IEP 30.000,00 80,0
JENOPTIK INFAB Ltd., Livingston/Scotland USD 51.000,00 80,0
JENOPTIK INFAB INC., Austin/USA USD 6.750,00 100,0
The following company was not included in the scope of consolidation
for the consolidated financial statements:
Company name and registered office Currency Nominal Participation
capital quota
%
------------------------------------------------------------------------------------------------------
JENOPTIK INFAB KK, Yokohama/Japan JPY 10.00 100,0
The Infab group is not obliged to prepare consolidated financial
statements as JENOPTIK AG, JENA, as the umbrella parent company,
prepares consolidated financial statements with a discharging effect
pursuant to Section 291 HGB [German Commercial Code]. The relationship
between JENOPTIK INFAB GmbH, Jena, and JENOPTIK INFAB, INC., Austin/USA
is not that between a parent company and a subsidiary as shares are
indirectly held by M+W Zander Facility Engineering GmbH + Co. KG,
Stuttgart. In addition, it is not obliged by law to prepare interim
financial statements during the financial year.
JENOPTIK INFAB plc., Galway/Ireland, and JENOPTIK INFAB Ltd.,
Livingston/Scotland, were consolidated for the first time. As a
consequence of the changes in the scope of consolidation, sales
increased by KDM 1.646 and the profit for the year was reduced by KDM
1.206.
JENOPTIK INFAB KK, Yokohama/Japan was founded in 1998. Its inclusion in
the scope of consolidation was dispensed with pursuant to Section 296
para. 2 HGB [German Commercial Code] due to its subordinate
significance.
32
II. CURRENCY TRANSLATION, PRINCIPLES OF CONSOLIDATION
The balance-sheet date for the companies included in the scope of
consolidation is 31st December 1999 and 1998. As per 30th June 1999 and
1998, interim financial statements were prepared for the companies
included in the scope of consolidation. The balance-sheet date for
individual financial statements covering the companies included in the
scope of consolidation is identical to that for the consolidated
interim financial statements of the Infab group.
At first, individual financial statements were prepared subject to the
provisions of the respective national accounting principles. Combined
INFAB Ltd. + plc. financial statements denominated in USD were prepared
for JENOPTIK INFAB plc., Galway/Ireland and JENOPTIK INFAB Ltd.,
Livingston/Scotland. To the extent that these provisions deviate from
statutory provisions relating to the make-up of balance sheets pursuant
to HGB [German Commercial Code], financial statements prepared
according to foreign law were brought in line with legal requirements
for the classification of financial statements and standards of
valuation pursuant to HGB [German Commercial Code].
For the purpose of the calculation of equity capital (excluding profit
for the period), USD-denominated amounts for companies abroad were
uniformly translated at historic exchange rates, the profit/loss for
the period was uniformly translated at the weighted average rate (based
on sales) and all other items on the balance sheet were uniformly
translated at the mean of buying and selling foreign-exchange rate
applicable on the balance-sheet date. Incongruences between foreign
currencies resulting therefrom were offset against reserves without
affecting the operating result.
The items on the profit and loss account were either translated at the
weighted average rate or at the mean of buying and selling
foreign-exchange rate applicable on the balance-sheet date.
Individual financial statements brought in line with German law were
combined into consolidated financial statements subject to the
application of the following measures:
Capital consolidation was carried out according to the book-value
method pursuant to Section 301 para. 1 sub-para. 2 No. 1 HGB [German
Commercial Code]. As far as initial consolidation is concerned, the
subsidiary's equity capital at that time is offset against the book
value of the holding of the parent company. Capital consolidation was
carried out at the time of acquisition of the shares.
Initial consolidation resulted in a credit balance in the amount of KDM
18.540 treated as goodwill which was openly offset against the capital
reserve pursuant to Section 309 para. 1 HGB [German Commercial Code].
Intra-group accounts receivable and accounts payable were offset within
the framework of debt consolidation.
All intra-group sales and other intra-group income and expense items
were consolidated in full in the consolidated profit and loss account.
Unrealised results of intra-group trade transactions did not have to be
eliminated.
Tax accrual and deferral based on consolidation measures pursuant to
Section 306 HGB [German Commercial Code] did not have to be made.
Deferred taxes based on income tax loss carried forward must not be
charged to subsequent accounting years according to German law
33
III. ACCOUNTING PRINCIPLES AND STANDARDS OF VALUATION
A S S E T S
INTANGIBLE ASSETS
Intangible assets were reported at acquisition cost minus scheduled
accumulated depreciation.
Depreciation is carried into effect on a pro rata temporis basis over
the usual useful life of an asset in the company according to the
straight-line method of depreciation.
TANGIBLE ASSETS
Tangible assets are reported at acquisition or production costs minus
scheduled accumulated depreciation. Depreciation is carried into effect
over the usual useful life of an asset in the company according to the
straight-line method of depreciation.
Pursuant to Section 6 para. 2 EStG [Income Tax Law], depreciable
movable fixed assets of low value acquired by JENOPTIK INFAB GmbH, Jena
were depreciated in full in the period of addition.
FINANCIAL ASSETS
Holdings in associated companies were reported at acquisition cost.
INVENTORIES
On principle, raw materials and supplies were reported at the average
acquisition cost and/or lower current market value.
The valuation of work in progress and finished goods and merchandise
was based on production costs adopted from corporate accounting.
Production costs include cost of direct material and materials handling
overhead, prime cost and indirect manufacturing overhead as well as
special production costs (e. g. cost of tools).
The determined amounts reported as production costs for work in
progress made to order were retrospectively audited for the purpose of
loss-free reporting.
Necessary and adequate provisions for slow-moving materials were made
concerning raw materials and supplies and finished goods and
merchandise to take insufficient demand or lack of marketability as per
the balance-sheet date into account.
34
ACCOUNTS RECEIVABLE AND OTHER ASSETS
Recognisable individual risks concerning accounts receivable and other
assets were taken into account by means of valuation adjustments. On
principle, the calculated lump-sum valuation adjustment on trade
receivables was 1 % of the respective net accounts receivable.
Foreign-currency accounts receivable were valued at the rate applicable
on the day of creation of the accounts receivable or at the lower
buying rate applicable on the balance-sheet date.
Accounts receivable and other assets were otherwise reported at nominal
values.
E Q U I T Y A N D L I A B I L I T I E S
ACCRUALS
The provisions for taxation and other accruals items take account of
all recognisable risks and contingent liabilities and were valued with
the due diligence of a prudent businessman.
LIABILITIES
All liabilities were valued at the amount repayable.
35
IV. EXPLANATORY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
INVENTORIES
Apart from the retention of titles to ownership common in the industry,
inventories are not subject to third-party rights.
RECEIVABLES FROM AFFILIATED COMPANIES
M+W Zander Facility Engineering GmbH + Co. KG, Stuttgart, the sole
shareholder, accounts for KDM 1.054 and KDM 441 of receivables from
affiliated companies at June 30, 1999 and December 31, 1998.
LIABILITIES
The liabilities item exclusively contains accounts payable due within
one year.
Titles for delivered objects covered by the trade payables item were
retained to the extent common in the industry.
The payables to affiliated companies item includes accounts payable to
M+W Zander Facility Engineering GmbH + Co. KG, Stuttgart, the sole
shareholder, in the amount of KDM 783 at December 31, 1998.
36
V. EXPLANATORY NOTES TO THE CONSOLIDATED PROFIT AND LOSS ACCOUNT
The profit and loss account is structured according to cost of sales
type of short-term results accounting.
"Research and development expenses" were added to the profit and loss
account as an additional item to the statutory accounting format.
SALES - 1999
Sales are made up as follows:
1 - 6/1999
KDM
---
Domestic sales 4.777
Foreign sales 7.893
------
12.670
======
AFFILIATED COMPANIES
Affiliated companies account for KDM 1.149 of the interest and similar
expenses item.
SALES - 1998
Sales are made up as follows:
1-6/1998
KDM
---
Domestic sales 7.672
Foreign sales 30.675
------
38.347
======
AFFILIATED COMPANIES
Affiliated companies account for KDM 757 of the interest and similar
expenses item.
37
VI.OTHER STATEMENTS
1999
1. The following gentlemen were appointed as managing directors of
JENOPTIK INFAB GmbH, Jena
Wolfgang Mayr, Koestenberg/Austria, and
Reimund Blessing, Vaihingen/Enz.
2. In first half of 1999, the emoluments of the members of the Board of
Management totalled KDM 160.
3. As per the balance-sheet date, the group companies employed 189
members of staff.
4. Infab group companies are included in the consolidated financial
statements of JENOPTIK AG, Jena. A duty to prepare consolidated
financial statements does not exist.
Stuttgart, 5th October 1999
JENOPTIK INFAB GmbH
The Board of Management
38
1998
1. The following gentlemen were appointed as managing directors of
JENOPTIK INFAB GmbH, Jena
Karl-Heinz Kuch, Wogau (until 1st July 1998),
Dr. Rudolf Simon, Korntal-Munchingen, and
Reimund Blessing, Vaihingen/Enz (from 1st July 1998).
2. In the reporting year, the Supervisory Board of JENOPTIK INFAB
GmbH, Jena, was made up of the following gentleman:
Jurgen Giessmann, Ludwigsburg-Neckarweihingen
(chairman),
Helmut Laub, Stuttgart,
Thomas Anger, Isserstedt, and
Siegfried Benno Jaschke, Erfurt.
3. In first half of 1998, the emoluments of the members of the Board
of Management totalled KDM 214. The emoluments paid to the
Supervisory Board amounted to TDM 15.
4. As per the balance-sheet date, the group companies employed 371
members of staff.
5. Infab group companies are included in the consolidated financial
statements of JENOPTIK AG, Jena. A duty to prepare consolidated
financial statements does not exist.
Stuttgart, 5th October 1999
JENOPTIK INFAB GmbH
The Board of Management
39
BROOKS AUTOMATION, INC.
UNAUDITED PRO FORMA COMBINED CONDENSED
FINANCIAL STATEMENTS
On September 30, 1999, Brooks Automation, Inc. (the "Company") acquired certain
of the assets and assumed certain of the liabilities of the Infab Division
("Infab") of Jenoptik AG ("Jenoptik") in exchange for 914,286 shares of the
Company's common stock, subject to adjustment pending the completion of a
post-closing review of the purchased assets. The Infab Division is a worldwide
supplier of advanced factory automation systems headquartered in Germany. The
assets purchased from the Infab Division included certain fixed assets, usable
inventory, collectible receivables, patents and intellectual property. The
Company intends to continue to use these assets in connection with its conduct
of the business of the former Infab Division.
The acquisition was accounted for using the purchase method of accounting in
accordance with Accounting Principles Board Opinion No. 16, "Business
Combinations" ("APB 16"). Under APB 16, purchase price allocations are made to
the assets acquired and the liabilities assumed based on their respective fair
values.
The estimated excess of the acquisition cost over the net tangible assets
acquired was determined as follows (in thousands):
Common stock $22,473
Transaction costs 1,476
-------
Total consideration 23,949
Estimated fair value of net tangible assets acquired 16,637
-------
Excess of purchase price over fair value of
net tangible assets acquired $ 7,312
=======
The estimated excess of the purchase price over the fair value of the net assets
acquired of $7,312,000 has been reflected in the unaudited pro forma financial
statements based on a preliminary purchase price allocation. Finalization of the
allocation of the purchase price to assets acquired and liabilities assumed will
be made after analyses of their fair values.
The following Pro Forma Combined Condensed Balance Sheet as of June 30, 1999 and
the Pro Forma Combined Condensed Statements of Operations for the nine months
ended June 30, 1999 and the year ended September 30, 1998 have been prepared to
reflect the effect of the acquisition by the Company of Infab.
On April 21, 1999, the Company acquired Hanyon Technology, Inc. ("Hanyon") in a
transaction accounted for using the purchase method of accounting. Hanyon's
historical results through its acquisition date and pro forma adjustments have
been included in the Pro Forma Combined Condensed Statement of Operations for
the nine months ended June 30, 1999. The Company's historical results include
the results of Hanyon subsequent to its date of acquisition.
On August 31, 1999, the Company acquired Smart Machines Inc. ("Smart Machines")
in a transaction accounted for as a pooling of interests. Smart Machines'
historical results and pro forma adjustments have been included in the Pro Forma
Combined Condensed Statement of Operations for the nine months ended June 30,
1999.
40
The Hanyon and Smart Machines pro forma financial information has been
aggregated with the Company's historical results for the year ended September
30, 1998 as reported in the Company's Current Report on Form 8-K/A, Amendment
No. 1, dated August 31, 1999.
The Company has included the Hanyon and Smart Machines pro forma financial
information because it believes these pro forma combined results are more
representative of the Company's ongoing operations before any pro forma
adjustments to reflect the acquisition of Infab.
The following unaudited pro forma information assumes that the acquisition of
Infab had occurred on June 30, 1999 for purposes of the balance sheet and on
October 1, 1997 for purposes of the statements of operations. The pro forma
information is based on the historical financial statements of the Company
(adjusted for Hanyon and Smart Machines) and Infab, giving effect to the Infab
transaction under the purchase method of accounting and the assumptions and
adjustments in the accompanying notes to the pro forma financial information.
The pro forma information for the nine months ended June 30, 1999 includes the
unaudited historical results of the Company, Hanyon and Smart Machines as
described above and of Infab for the nine months then ended. The pro forma
information for the fiscal year ended September 30, 1998 includes the unaudited
historical results of the Company adjusted to give effect to the Hanyon and
Smart Machines acquisitions as described above for the year then ended, and the
historical results of Infab for the year ended December 31, 1998. Accordingly,
the unaudited results of operations for the Infab quarter ended December 31,
1998 are included in both the nine-month and fiscal year periods. Revenues and
loss from continuing operations for that quarter were $2,761,000 and $9,788,000,
respectively.
The pro forma information does not purport to be indicative of the financial
position or results of operations that would have been attained had the
combinations been in effect on the dates indicated nor of future results of
operations of the Company. The pro forma combined condensed financial statements
should be read in conjunction with the separate audited financial statements and
notes thereto of Brooks Automation, Inc., included in its Annual Report on Form
10-K for the year ended September 30, 1998, the unaudited financial information
included in the Company's Form 10-Q for the three and nine month periods ended
June 30, 1999, the Company's Current Report on Form 8-K and Form 8-K/A,
Amendment No. 1, dated April 21, 1999, the Company's Current Report on Form 8-K
and Form 8-K/A, Amendment No. 1, dated August 31, 1999 and the audited financial
statements and notes thereto of Infab included as part of this Form 8-K/A.
41
BROOKS AUTOMATION, INC.
UNAUDITED PRO FORMA COMBINED CONDENSED BALANCE SHEET
JUNE 30, 1999
$000'S
Smart
Historical Machines
Historical Smart Historical Pro forma
Brooks (A) Machines Infab (1) Adjustments(2)
---------- -------- --------- --------------
ASSETS
CURRENT ASSETS
Cash and equivalents $ 68,101 $ 120 $ 495 $ --
Accounts receivable, net 25,340 23 10,750 --
Inventories 19,085 498 12,533 --
Prepaid expenses and other current assets 10,114 61 206 --
--------- --------- --------- ---------
Total current assets 122,640 702 23,984 --
Fixed assets, net 17,230 333 3,123 --
Infab intangibles -- -- -- --
Other intangible assets, net 5,298 -- 7,189 --
Other 4,781 15 81 --
--------- --------- --------- ---------
TOTAL ASSETS $ 149,949 $ 1,050 $ 34,377 $ --
========= ========= ========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Borrowings due within one year $ -- $ 2,940 $ -- $ (2,500)
Accounts payable 6,539 225 49,173 --
Accrued expenses and other current liabilities 18,311 325 6,690 (214)
--------- --------- --------- ---------
Total current liabilities 24,850 3,490 55,863 (2,714)
--------- --------- --------- ---------
LONG-TERM LIABILITIES
Debt -- 889 -- --
Other long-term liabilities 1,518 -- -- --
--------- --------- --------- ---------
Total long-term liabilities 1,518 889 -- --
--------- --------- --------- ---------
TOTAL LIABILITIES 26,368 4,379 55,863 (2,714)
--------- --------- --------- ---------
MINORITY INTEREST 1,500 -- (540) --
--------- --------- --------- ---------
REDEEMABLE CONVERTIBLE PREFERRED STOCK -- 3,562 -- (3,562)
--------- --------- --------- ---------
STOCKHOLDERS' EQUITY
Preferred stock -- 6,922 -- (6,922)
Common stock 111 771 2,650 (766)
Additional paid-in capital 129,340 -- 11,624 13,964
Cumulative translation adjustment (573) -- -- --
Deferred compensation (79) -- -- --
Retained earnings (accumulated deficit) (6,718) (14,584) (35,220) --
--------- --------- --------- ---------
Total stockholders' equity 122,081 (6,891) (20,946) 6,276
--------- --------- --------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 149,949 $ 1,050 $ 34,377 $ --
========= ========= ========= =========
Infab
Pro forma Pro forma
Adjustments(3) Combined
-------------- --------
ASSETS
CURRENT ASSETS
Cash and equivalents $ 1,529 $ 70,245
Accounts receivable, net (7,205) 28,908
Inventories (3,193) 28,923
Prepaid expenses and other current assets 1,520 11,901
--------- ---------
Total current assets (7,349) 139,977
Fixed assets, net (1,427) 19,259
Infab intangibles 7,312 7,312
Other intangible assets, net (7,189) 5,298
Other (81) 4,796
--------- ---------
TOTAL ASSETS $ (8,734) $ 176,642
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Borrowings due within one year $ -- $ 440
Accounts payable (49,173) 6,764
Accrued expenses and other current liabilities (3,520) 21,592
--------- ---------
Total current liabilities (52,693) 28,796
--------- ---------
LONG-TERM LIABILITIES
Debt -- 889
Other long-term liabilities -- 1,518
--------- ---------
Total long-term liabilities -- 2,407
--------- ---------
TOTAL LIABILITIES (52,693) 31,203
--------- ---------
MINORITY INTEREST 540 1,500
--------- ---------
REDEEMABLE CONVERTIBLE PREFERRED STOCK -- --
--------- ---------
STOCKHOLDERS' EQUITY
Preferred stock -- --
Common stock (2,641) 125
Additional paid-in capital 10,840 165,768
Cumulative translation adjustment -- (573)
Deferred compensation -- (79)
Retained earnings (accumulated deficit) 35,220 (21,302)
--------- ---------
Total stockholders' equity 43,419 143,939
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ (8,734) $ 176,642
========= =========
(A) As filed on Form 10-Q for the quarterly period ended June 30, 1999.
42
BROOKS AUTOMATION, INC.
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED JUNE 30, 1999
$000'S
Historical Hanyon
Historical Historical Smart Historical Pro forma
Brooks (A) Hanyon (4) Machines Infab (1) Adjustments(5)
---------- ---------- -------- --------- --------------
Revenues $ 69,449 $ 2,306 $ 537 $ 9,518 $ (613)
Cost of revenues 38,381 130 1,102 13,539 (613)
-------- -------- -------- -------- --------
Gross profit 31,068 2,176 (565) (4,021) --
OPERATING EXPENSES
Research and development 13,661 -- 1,844 2,698 --
Selling, general and administrative 19,066 1,530 700 11,628 --
Amortization of acquired intangibles 79 -- -- -- 212
-------- -------- -------- -------- --------
Total operating expenses 32,806 1,530 2,544 14,326 212
OPERATING INCOME (LOSS) (1,738) 646 (3,109) (18,347) (212)
OTHER (INCOME) EXPENSE
Interest (income) expense, net (2,087) 87 201 1,058 --
Other (income) expense, net -- -- -- (202) --
-------- -------- -------- -------- --------
Total other (income) expense (2,087) 87 201 856 --
Income (loss) from continuing
operations before income taxes
and minority interests 349 559 (3,310) (19,203) (212)
Income tax provision (benefit) 536 (44) 1 22 --
-------- -------- -------- -------- --------
INCOME(LOSS) FROM
CONTINUING OPERATIONS
BEFORE MINORITY INTERESTS (187) 603 (3,311) (19,225) (212)
Minority interests in earnings (loss)
of consolidated subsidiaries -- -- -- (378) (58)
-------- -------- -------- -------- --------
NET INCOME (LOSS) (187) 603 (3,311) (18,847) (154)
Dividends on preferred stock -- -- (549) -- --
-------- -------- -------- -------- --------
NET INCOME (LOSS) APPLICABLE TO
COMMON STOCKHOLDERS $ (187) $ 603 $ (3,860) $(18,847) $ (154)
======== ======== ======== ======== ========
Earnings (loss) per share:
Basic $ (0.02)
Diluted $ (0.02)
Shares used to compute earnings (loss) per share:
Basic 11,039
Diluted 11,039
Smart
Machines Infab
Pro forma Pro forma Pro forma
Adjustments(6) Adjustments Combined
-------------- ----------- --------
Revenues $ -- $ -- $ 81,197
Cost of revenues -- -- 52,539
-------- -------- --------
Gross profit -- -- 28,658
OPERATING EXPENSES
Research and development -- -- 18,203
Selling, general and administrative -- -- 32,924
Amortization of acquired intangibles -- 1,828(7) 2,119
-------- -------- --------
Total operating expenses -- 1,828 53,246
OPERATING INCOME (LOSS) -- (1,828) (24,588)
OTHER (INCOME) EXPENSE
Interest (income) expense, net -- -- (741)
Other (income) expense, net -- -- (202)
-------- -------- --------
Total other (income) expense -- -- (943)
Income (loss) from continuing
operations before income taxes
and minority interests -- (1,828) (23,645)
Income tax provision (benefit) (874) -- (359)
-------- -------- --------
INCOME(LOSS) FROM
CONTINUING OPERATIONS
BEFORE MINORITY INTERESTS 874 (1,828) (23,286)
Minority interests in earnings (loss)
of consolidated subsidiaries -- 378(8) (58)
-------- -------- --------
NET INCOME (LOSS) 874 (2,206) (23,228)
Dividends on preferred stock -- -- (549)
-------- -------- --------
NET INCOME (LOSS) APPLICABLE TO
COMMON STOCKHOLDERS $ 874 $ (2,206) $(23,777)
======== ======== ========
Earnings (loss) per share:
Basic $ (1.98)
Diluted $ (1.98)
Shares used to compute earnings (loss) per share:
Basic 12,021
Diluted 12,021
(A) As filed on Form 10-Q for the quarterly period ended June 30, 1999.
43
BROOKS AUTOMATION, INC.
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED SEPTEMBER 30, 1998
$000'S
Historical Historical Pro forma Pro forma
Brooks (A) Infab (1) Adjustments Combined
---------- --------- ----------- --------
Revenues $ 107,697 $ 31,504 $ -- $ 139,201
Cost of revenues 73,924 28,722 -- 102,646
--------- --------- --------- ---------
Gross profit 33,773 2,782 -- 36,555
OPERATING EXPENSES
Research and development 25,389 3,670 -- 29,059
Selling, general and administrative 30,392 21,507 -- 51,899
Amortization of acquired intangibles -- -- 2,437(7) 2,437
Acquisition-related and restructuring 3,722 -- -- 3,722
--------- --------- --------- ---------
Total operating expenses 59,503 25,177 2,437 87,117
OPERATING INCOME (LOSS) (25,730) (22,395) (2,437) (50,562)
OTHER (INCOME) EXPENSE
Interest (income) expense, net (2,941) 1,072 -- (1,869)
Other (income) expense, net -- (73) -- (73)
--------- --------- --------- ---------
Total other (income) expense (2,941) 999 -- (1,942)
Income (loss) from continuing
operations before income taxes and minority
interests (22,789) (23,394) (2,437) (48,620)
Income tax provision(benefit) (2,835) (1) -- (2,836)
--------- --------- --------- ---------
INCOME(LOSS) FROM
CONTINUING OPERATIONS
BEFORE MINORITY INTERESTS (19,954) (23,393) (2,437) (45,784)
Minority interests in earnings (loss)
of consolidated subsidiaries -- (239) 239(8) --
--------- --------- --------- ---------
NET INCOME (LOSS) (19,954) (23,154) (2,676) (45,784)
Dividends on preferred stock (1,420) -- -- (1,420)
--------- --------- --------- ---------
NET INCOME (LOSS) APPLICABLE TO
COMMON STOCKHOLDERS $ (21,374) $ (23,154) $ (2,676) $ (47,204)
========= ========= ========= =========
Earnings (loss) per share:
Basic $ (1.99) $ (4.05)
Diluted $ (1.99) $ (4.05)
Shares used to compute earnings (loss) per share:
Basic 10,739 11,653
Diluted 10,739 11,653
(A) Pro forma combined results of the Company, Hanyon and Smart Machines as
filed on the Company's Current Report on Form 8-K/A, Amendment No. 1, dated
August 31, 1999.
44
NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED
FINANCIAL STATEMENTS
(1) The Infab balance sheet at June 30, 1999 has been translated to U.S.
dollars at a rate of 1.8912 German deutschmarks to 1.0 U.S. dollar. The
statement of operations for the nine months ended June 30, 1999 was
translated as follows: results for the three months ended December 31, 1998
were translated at a rate of 1.7588 German deutschmarks to 1.0 U.S. dollar
and results for the six months ended June 30, 1999 were translated at a
rate of 1.7970 German deutschmarks to 1.0 U.S. dollar. The statement of
operations for the year ended December 31, 1998 was translated at a rate of
1.7588 German deutschmarks to 1.0 U.S. dollar. All Infab historical amounts
are presented in accordance with U.S. generally accepted accounting
principles.
(2) To record the issuance of Brooks common stock in exchange for all of the
Smart Machines outstanding common stock, preferred stock, and convertible
notes and related interest.
(3) To adjust the historical balance sheet of Infab to equal the assets
acquired and the liabilities assumed under the acquisition agreement. The
following purchase price and purchase accounting adjustments were made to
the historical balance sheet:
- Consideration of 914,286 shares of Brooks common stock issued at $24.58
per share.
- Transaction costs of $1,476,000, of which $976,000 was paid and $500,000
was accrued.
- Adjustments of $2,670,000 to record costs for exiting certain Infab
facilities, the relocation of Infab employees to the Company's
facilities and severance costs. This purchase accounting adjustment is
recorded as a component of goodwill and an increase in liabilities.
- Preliminary allocation of the purchase price and the elimination of net
liabilities and minority interest of $55,323,000 not assumed by the
Company, as well as $20,946,000 of historical stockholders' deficit of
Infab. Goodwill will be amortized on a straight-line basis over three
years.
(4) The Hanyon statement of operations for the period from October 1, 1998
through April 20, 1999 (date of its acquisition by the Company) is
translated at a rate of 1,240.84 Korean won to 1.0 U.S. dollar.
(5) Hanyon pro forma adjustments to eliminate intercompany transactions as a
result of intercompany software product sales, record amortization of
Hanyon goodwill, and record the 9.5% minority shareholders' interest in
Hanyon's earnings.
(6) To adjust income tax expense as a result of the Smart Machines acquisition,
which was accounted for as a pooling of interests.
(7) To record amortization expense for the intangible asset which represents
the excess of purchase price over net tangible assets acquired established
as part of the Company's purchase accounting related to the acquisition of
Infab.
(8) To eliminate minority shareholders' interest in Infab's loss; the Company
did not assume this liability.
45
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, thereunto duly authorized.
By: /s/ Ellen B. Richstone
--------------------------------------
Ellen B. Richstone
Senior Vice President of Finance and
Administration and Chief Financial
Officer
Dated: December 14, 1999
46
EXHIBIT INDEX
Item No. Description
-------- -----------
* 2.1 Master Purchase Agreement by and among
Brooks Automation, Inc., FASTech
Integration, Inc., Brooks Automation GmbH,
Jenoptik AG, Meissner & Wurst Zander Holding
GmbH, Jenoptik Infab GmbH, Jenoptik Infab
KK, Jenoptik Infab PLC, Jenoptik Infab,
Ltd., Meissner & Wurst US, Inc. and Jenoptik
Infab, Inc. dated as of September 9, 1999,
as amended on September 30, 1999.
* 2.2 Stockholder Agreement dated September 30,
1999 among Brooks Automation, Inc., Jenoptik
AG, Meissner & Wurst Zander Holding GmbH and
Robert J. Therrien.
23.1 Consent of Ebner Stolz & Partner GmbH
- -------------------------------------------
* Previously filed