<<The purchase price paid to Whittaker consisted of $35,000,000 in cash and three-year warrants to purchase up to 500,000 shares of
common stock of the Company at an exercise price of $35 per share. During the year ended December 31, 1995, the period from January 1, 1996 through April 9, 1996 (the day Xyplex was acquired by Whittaker), the period from April 10, 1996 through October 31, 1996 and the fiscal year ended October 31, 1997, Xyplex reported net revenues of $107,617,000, $28,100,000, $52,021,000, and $75,663,000, respectively, and net losses of $37,360,000, $2,269,000, $13,355,000 and $80,309,000, respectively. While adding 11 months of Xyplex'
revenues to those of the Company, the charges resulting from the Xyplex Acquisition are expected to have a material adverse effect on the net operating results the Company expects to report during and for the year ending December 31, 1998. The Company's ability to operate Xyplex profitably will depend upon its ability to integrate this business successfully, including (i) the completion of Xyplex' research and development projects in process, especially the EdgeBlaster program, (ii) the integration of the products,
technologies and personnel of Xyplex into the Company, (iii) management's ability to reduce Xyplex' operating costs and (iv) the continued market acceptance of Xyplex' products and technology.
An important element of management's strategy is to review acquisition
prospects that would complement the Company's existing products, augment its market coverage and distribution ability or enhance its technological capabilities. Accordingly, the Company may acquire additional businesses, products or technologies in the future. >>
Stuff in 10Ks are supposed to highlight potential risks of course.
But "material adverse affect on net operating results" for all of 1998 seems a bit strong - especially since the positives are not stressed. |
