Attached files
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of
the
Securities Exchange Act of 1934
October
12, 2009
Date of
Report (date of earliest event reported)
Sigma
Designs, Inc.
(Exact
name of Registrant as specified in its charter)
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California
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001-32207
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94-2848099
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||
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(State
or other jurisdiction of incorporation or organization)
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(Commission
File Number)
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(I.R.S.
Employer
Identification
Number)
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1778
McCarthy Blvd
Milpitas,
California 95035
(Address
of principal executive offices)
(408)
262-9003
(Registrant’s
telephone number, including area code)
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
[ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
Item
1.01. Entry into a Material Definitive Agreement.
On
October 12, 2009, Sigma Designs, Inc. (“Sigma”), entered into an
Acquisition Agreement (the “Acquisition Agreement”), with
CopperGate Communications Ltd. (“CopperGate”), the selling
shareholders named therein, and each of Carmel V.C. 2 Ltd. and Tamir Fishman
Ventures Management II Ltd. as the Holder Representatives. Under the
terms of the Acquisition Agreement, Sigma has agreed to acquire, directly or
indirectly through a wholly owned Israeli subsidiary of Sigma (“Acquisition Subsidiary”), all
of the issued and outstanding share capital of CopperGate, by way of a share
purchase of all of the issued and outstanding share capital of
CopperGate.
Pursuant
to the terms of the Acquisition Agreement, in exchange for all outstanding
shares of CopperGate and all shares of CopperGate issuable upon the exercise of
CopperGate vested options as of the closing, Sigma will pay cash and issue a
certain number of shares of Sigma common stock, subject to adjustment in
accordance with the terms of the Acquisition Agreement. The estimated
amount of cash to be paid by Sigma on the closing date is approximately $92
million, plus the amount of cash and cash equivalents held by CopperGate at the
closing, net of CopperGate transaction expenses and debt outstanding at the
closing. As of September 30, 2009, CopperGate had cash and cash
equivalents of approximately $24.4 million and no debt
outstanding. Sigma will also issue shares of its common stock to
CopperGate shareholders estimated at the time of signing to equal approximately
4.0 million shares, including 0.5 million shares that will be issuable upon
exercise of CopperGate unvested options that Sigma has agreed to assume in the
transaction. The amount of cash consideration is subject to increase
in the event the number of Sigma’s shares to be issued pursuant to the
Acquisition Agreement exceeds the maximum amount permissible under the
agreement. At least ninety percent (90%) of the shares issued at
closing will be subject to a lockup that will expire in equal
installments. The first lockup expiration period will occur on the
later of the second business day following Sigma’s first public earnings release
following the closing, or the date of effectiveness of a registration statement
which registers the shares issued at the closing; and thereafter on the 60th,
120th and 180th day following the first expiration period.
Sigma has
also agreed to pay up to an aggregate of $5.0 million in cash to specified
CopperGate employees provided that the eligible employee remains employed by
Sigma and certain milestones are achieved. Sigma will also assume
unvested stock options held by CopperGate employees that will become exercisable
for approximately 0.5 million shares of Sigma common stock when vested in
accordance with their existing vesting schedules. The Acquisition
Agreement provides that 10% of the total number of shares of Sigma common stock
issued at closing (excluding any shares issuable upon exercise of assumed
CopperGate unvested options) and 10% of the cash payable to the shareholders of
CopperGate and the holders of CopperGate vested options will be placed into
escrow and available to Sigma for breaches of representations and warranties of
CopperGate and the selling shareholders and other specified items for 12 months
following the closing, and for breaches of specified representations and
warranties for 18 months following the closing.
In
connection with the execution of the Acquisition Agreement, certain shareholders
representing over 90% of the outstanding capital stock of CopperGate (the “Supporting Stockholders”) and
Sigma have entered into a Voting and Support Agreement (the “Support Agreement”) pursuant
to which, among other things, each of the Supporting Stockholders has agreed to
vote his, her or its shares of CopperGate (i) in favor of the Acquisition
Agreement and the transaction contemplated thereby (ii) against any action or
agreement that would result in a breach of any covenant, representation or
warranty or any other obligation or agreement of CopperGate or its shareholders
under the Acquisition Agreement; and (iii) against approval of any proposal
made in opposition to the consummation of the Acquisition
Agreement.
The
Acquisition Agreement and the acquisition have been approved by the board of
directors of each company. The closing of the transaction remains
subject to closing conditions, including the approval of the shareholders of
CopperGate and Israeli securities law matters. The holders of over
95% of the outstanding capital stock of CopperGate have executed the Acquisition
Agreement. The transaction is expected to close in 45 to 60
days.
The
Acquisition Agreement provides that if less than 100% of CopperGate shareholders
have executed the Acquisition Agreement within ten business days following the
date of the Acquisition Agreement, Sigma may provide notice to
CopperGate of its desire to amend the Acquisition Agreement to provide that the
acquisition be consummated as a merger, which shall be effected no later than 75
days after execution of a merger agreement to be negotiated in good faith by the
parties. If, after working in good faith to execute a merger
agreement, the parties cannot agree on a merger agreement within five business
days of Sigma’s notice to CopperGate, the parties will use commercially
reasonable efforts to facilitate the closing in accordance with the provisions
set forth in the Acquisition Agreement.
The
Acquisition Agreement may be terminated at any time prior to closing by either
party through mutual consent, or, generally, if all remaining closing conditions
have not been satisfied and the closing has not occurred by 90 days from date of
Acquisition Agreement, or if an alternative merger agreement is executed, 120
days from date of the Acquisition Agreement. The Acquisition
Agreement also may be terminated by either party in the event of certain
material breaches or misrepresentations by the other party that are not timely
cured.
Further
Information
A copy of
the Acquisition Agreement and the Support Agreement are attached to this Current
Report on Form 8-K as Exhibit 2.1 and Exhibit 10.1, respectively, and are
incorporated therein by reference. The summary description of the
proposed transaction set forth above does not purport to be complete and is
qualified in its entirety by reference to the Acquisition
Agreement.
Item
7.01 Regulation FD Disclosure.
On
October 13, 2009, the management of Sigma conducted a conference call with
investors to discuss the transaction in detail. A copy of the transcript of the
conference call is attached as Exhibit 99.1 hereto.
In
accordance with General Instruction B.2 of Form 8-K, the information included or
incorporated in Item 7.01 of this report, including Exhibit 99.1, is being
furnished to the Commission and shall not be deemed “filed” for purposes of
Section 18 of the Securities and Exchange Act of 1934, as amended, nor shall it
be deemed incorporated by reference in any filing under the Securities Act of
1933, except as shall be expressly set forth by specific reference in such
filing.
Item
9.01. Financial Statements and Exhibits.
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(d)
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Exhibits.
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Exhibit
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Description
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2.1
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Acquisition
Agreement, dated as of October 12, 2009, by and among Sigma Designs, Inc.,
CopperGate Communications Ltd., Carmel V.C. 2 Ltd. and Tamir Fishman
Ventures Management II Ltd., as the Holder Representatives, and the
Selling Shareholders.*
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10.1
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Form
of Voting and Support Agreement.
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99.1
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Transcript
from conference call on October 13,
2009.
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* Schedules
and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation
S-K. Sigma undertakes to furnish supplemental copies of any of the
omitted schedules and exhibits upon request by the U.S. Securities and Exchange
Commission.
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the Registrant has duly caused this Report to
be signed on its behalf by the undersigned hereunto duly
authorized.
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Dated:
October 13, 2009
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SIGMA
DESIGNS, INC.
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By:
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/s/ Thinh Q. Tran | ||
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Thinh
Q. Tran
President
and Chief Executive Officer
(Principal
Executive Officer)
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EXHIBIT
INDEX
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Exhibit
No.
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Description
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2.1
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Acquisition
Agreement, dated as of October 12, 2009, by and among Sigma Designs, Inc.,
CopperGate Communications Ltd., Carmel V.C. 2 Ltd. and Tamir Fishman
Ventures Management II Ltd., as the Holder Representatives, and the
Selling Shareholders.*
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10.1
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Form
of Voting and Support Agreement.
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99.1
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Transcript
from conference call on October 13,
2009.
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* Schedules
and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation
S-K. Sigma undertakes to furnish supplemental copies of any of the
omitted schedules and exhibits upon request by the U.S. Securities and Exchange
Commission.