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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) JULY 31, 1998
KEITHLEY INSTRUMENTS, INC.
(Exact name of registrant as specified in its charter)
OHIO 1-9965 34-0794417
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
28775 AURORA ROAD, SOLON, OHIO 44139
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (440) 248-0400
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Item 2. Acquisition or Disposition of Assets.
On August 10, 1998, Keithley Instruments, Inc., (the "Company" or the
"Registrant") sold certain assets of the Company used in the operation of its
Radiation Measurements Division ("RMD") to Inovision Radiation Measurements,
L.L.C. ("Inovision") pursuant to an Asset Purchase Agreement entered into on and
effective as of July 31, 1998. The major asset categories include RMD's
inventory, accounts receivable, machinery, equipment, furniture and other
tangible personal property, and intangible assets including patents, technology
and goodwill. The purchase price for the transaction was $8,215,000 in cash
which was paid in full upon closing. Additionally, Inovision has assumed certain
liabilities of RMD including accrued vacation, real estate taxes, accrued
consultants, warranty, certain contracts and commissions, at an amount not to
exceed $735,000.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(b) Pro Forma Financial Information.
(i) Introduction to Pro Forma Financial Statements
(ii) Unaudited Pro forma Consolidated Balance Sheet as of
June 30, 1998
(iii) Unaudited Pro forma Consolidated Statements of Income for the
fiscal year ended September 30, 1997, and the nine months
ended June 30, 1998
(iv) Notes
(c) Exhibits.
2(a) Plan of Acquisition, Reorganization, Arrangement, Liquidation or
Succession
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INTRODUCTION TO PRO FORMA FINANCIAL STATEMENTS
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The unaudited pro forma consolidated statements of income for the year ended
September 30, 1997 and the nine months ended June 30, 1998, present the
operating results of Keithley Instruments, Inc., excluding the operations of its
Radiation Measurements Division. The unaudited pro forma consolidated statements
of income are presented as if the transaction had occurred at the beginning of
the year ended September 30, 1997. The unaudited pro forma consolidated balance
sheet has been prepared assuming the transaction had occurred as of June 30,
1998.
The net cash proceeds from the sale of RMD have been applied to reduce the
company's long-term debt. The gain resulting from the sale of RMD has been
excluded from the unaudited pro forma consolidated statements of income.
The unaudited pro forma information is not necessarily indicative of the results
of operations or financial position that would have resulted had the sale
occurred as of the dates and for the periods indicated, or which may be attained
in the future. The unaudited pro forma consolidated financial statements and the
notes thereto should be read in conjunction with the Company's historical
financial statements and related notes thereto included in the Company's Annual
Report on Form 10-K for the year ended September 30, 1997, and Quarterly Report
on Form 10-Q for the quarter ended June 30, 1998.
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UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
JUNE 30, 1998
(In Thousands)
Historical Elimination Consolidating Proforma
Balances of RMD (a) Adjustments (b) Balances
-------- ---------- --------------- --------
Assets
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Current assets:
Cash and cash equivalents $ 2,412 $ $2,359 $ 4,771
Accounts receivable and other, net 18,155 (1,059) 17,096
Inventories:
Raw materials 7,512 (476) 7,036
Work in process 4,198 (486) 3,712
Finished products 3,912 (364) 3,548
------- -------- ------- -------
Total inventories 15,622 (1,326) 0 14,296
Other current assets 3,206 -- 3,206
------- -------- ------- -------
Total current assets 39,395 (2,385) 2,359 39,369
------- -------- ------- -------
Property, plant and equipment, at cost 42,825 (3,297) 39,528
Less-Accumulated depreciation 26,187 (1,743) 24,444
------- -------- ------- -------
Total property, plant and equipment, net 16,638 (1,554) 0 15,084
------- -------- ------- -------
Other assets 15,368 (1,122) 14,246
------- -------- ------- -------
Total assets $71,401 $ (5,061) $2,359 $68,699
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Liabilities and Shareholders' Equity
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Current liabilities:
Accounts payable $ 6,357 $ $ 373 $ 6,730
Accrued payroll and related expenses 4,815 (111) 783 5,487
Other accrued expenses 5,985 (215) 125 5,895
Income taxes payable 2,106 861 2,967
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Total current liabilities 19,263 (326) 2,142 21,079
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Long-term debt 12,265 (6,265) 6,000
Other long-term liabilities 3,928 3,928
Shareholders' equity:
Paid-in-capital 8,867 8,867
Earnings reinvested in the business 27,636 24 1,723 29,383
Other shareholders' equity (558) (558)
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Total shareholders' equity 35,945 24 1,723 37,692
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Total liabilities and shareholders' equity $71,401 $ (302) $(2,400) $68,699
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UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED SEPTEMBER 30, 1997
(In Thousands of Dollars Except for Per Share Data)
Historical Elimination Consolidating Proforma
Results of RMD (c) Adjustments (d) Results
------- ---------- --------------- -------
Net sales $ 123,295 $ 9,746 $ $ 113,549
Cost of goods sold 51,924 5,132 46,792
Selling, general and administrative
expenses 51,011 4,042 46,969
Product development expenses 17,233 1,120 16,113
Special charges 771 771
Net financing expenses 1,145 -- 550 595
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Income (loss) before income taxes 1,211 (548) (550) 2,309
Income taxes (benefit) 421 (181) (182) 783
------- -------- --------- --------
Net income (loss) $ 790 $ (367) $ (369) $ 1,526
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Basic income (loss) per share $ 0.10 $ (0.05) $ (0.05) $ 0.20
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Diluted income (loss) per share $ 0.10 $ (0.05) $ (0.05) $ 0.19
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Average number of shares outstanding (in thousands):
Basic 7,588 7,588
Diluted 7,867 7,867
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UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE NINE MONTHS ENDED JUNE 30, 1998
(In Thousands of Dollars Except for Per Share Data)
Historical Elimination Consolidating Proforma
Results of RMD (c) Adjustments (d) Results
------- ---------- --------------- -------
Net sales $ 89,897 $ 8,070 $ $ 81,827
Cost of goods sold 38,182 4,318 33,864
Selling, general and administrative
expenses 36,499 3,143 33,356
Product development expenses 10,271 549 9,722
Special charges 335 335
Net financing expenses 816 -- 435 381
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Income (loss) before income taxes 3,794 60 (435) 4,169
Income taxes (benefit) 1,252 20 (144) 1,376
------- ------ -------- -------
Net income (loss) $ 2,542 $ 40 $ (291) $ 2,793
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Basic income (loss) per share $ 0.33 $ 0.01 $ (0.04) $ 0.36
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Diluted income (loss) per share $ 0.32 $ 0.01 $ (0.04) $ 0.35
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Average number of shares outstanding (in thousands):
Basic 7,777 7,777
Diluted 8,029 8,029
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NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS
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(a) Elimination of assets sold to and liabilities assumed by the buyer reflect
the terms of the Asset Purchase Agreement.
(b) The consolidating adjustments include/reflect:
- The repayment of long-term debt to $6,000 using the net cash proceeds
from the sale.
- Additional liabilities that are directly attributable to the sale such
as severance costs, legal and accounting fees and broker fees.
- Retained earnings as a result of the sale.
(c) Includes the actual results of the Radiation Measurements Division for the
applicable reporting period, less interest allocations.
(d) Consolidated adjustments for net financing expenses assume the pay down of
an additional $8,215 of long-term debt at October 1, 1996, (not to a level
below $6,000) at an average interest rate of 6.7 percent for the applicable
period.
SIGNATURES
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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.
KEITHLEY INSTRUMENTS, INC.
(Registrant)
Date: August 17, 1998 /s/ Ronald M. Rebner
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Ronald M. Rebner
Vice President and Chief Financial Officer
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