-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ux0IBqEpXBj1dP3doLuB1X+eqhM6PWcY4cU2UnmNXSj+AqgWMBtNO4wD9oTuBJtN JHqQLHXiAnM6LKIaFs74pA== 0000950135-99-000254.txt : 19990126 0000950135-99-000254.hdr.sgml : 19990126 ACCESSION NUMBER: 0000950135-99-000254 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990118 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990125 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PICTURETEL CORP CENTRAL INDEX KEY: 0000755095 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE & TELEGRAPH APPARATUS [3661] IRS NUMBER: 042835972 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-09434 FILM NUMBER: 99512169 BUSINESS ADDRESS: STREET 1: 100 MINUTEMAN RD CITY: ANDOVER STATE: MA ZIP: 01810 BUSINESS PHONE: 5087625000 MAIL ADDRESS: STREET 1: 222 ROSEWOOD DR CITY: DANVERS STATE: MA ZIP: 01923 FORMER COMPANY: FORMER CONFORMED NAME: PICTEL CORP DATE OF NAME CHANGE: 19870505 8-K 1 PICTURETEL CORPORATION 1 UNITED STATES ------------- 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): January 18, 1999 PICTURETEL CORPORATION (Exact name of Registrant as specified in its charter) DELAWARE 1-9434 04-2835972 -------- (State or other jurisdiction of (Commission File Number (I.R.S. Employer incorporation or organization Identification No.) 100 MINUTEMAN ROAD, ANDOVER, MA. 01810 - -------------------------------- ----- (Address of Principal Executive Offices) (Zip Code) REGISTRANT'S TELEPHONE NUMBER: 978-292-5000 - ------------------------------ -1- 2 Item 5. Other Events PictureTel and Intel have entered into a Distribution and Joint Product Development agreement. Under terms of the agreement, Intel will provide PictureTel with distribution rights to sell the Intel(R) ProShare(R) Video System 500, and exclusive worldwide distribution rights to sell and support the Intel(R) TeamStation(TM) System. In addition to its expertise in videoconferencing distribution, sales and marketing, PictureTel will provide its complete line of professional, managed and maintenance support services for both products. These Intel products augment PictureTel's existing product line of group, compact, and desktop videoconferencing systems. By utilizing their respective strengths in PC technology innovation and visual collaboration, the two companies will develop high-quality PC-based solutions for customers' diverse communication needs and make it easier for customers to access global services and support. The jointly developed products will take advantage of rapidly emerging markets and technologies, including the next-generation Internet, broadband, cable modems, XDSL, and others. The companies expect the result of their collaboration to be a larger, more competitive videoconferencing industry that distributes products and building blocks through a wider range of channels. Intel and PictureTel also agreed to begin joint development of videoconferencing and collaboration products based on a common PC-based architecture. The common platform will be the foundation for future products that will feature communication and multimedia capabilities such as collaboration over LANs, 3 streaming audio and video, and real-time conferencing. The full benefit of this joint development agreement can be expected in the year 2000. These future products -- which will operate over multiple networks, including IP, ISDN and ATM -- will complement PictureTel's existing product line and will be marketed under the PictureTel brand name. Intel plans to market the resulting building-block components to other manufacturers and integrators. In connection with the Distribution and Joint Product Development Agreement signed January 18, 1999, Intel will also invest $30.5 million in PictureTel, subject to completion of closing conditions in a Stock Purchase and Investor Rights Agreement between the two companies signed concurrently. The shares of a new series of non-voting Series A Preference Stock, convertible into the same number of shares of PictureTel Common Stock (with anti-dilution protection for stock splits and the like), was established by vote of PictureTel's Board of Directors pursuant to its authority under the Company's charter and will represent on an as-converted basis an investment in approximately 10% of PictureTel Common Stock. This security is to be sold by PictureTel in consideration of the payment by Intel of cash of $6.81 per share (or, if lower, the average of the closing prices of a share of PictureTel Common Stock on NASDAQ NMS during a specified trading period prior to the closing) and Intel's entering into the Distribution and Joint Product Development Agreement referenced above. Under the Stock Purchase and Investor Rights Agreement Intel has certain ancillary rights to acquire additional securities of 4 PictureTel in order to maintain, subject to the specified terms and conditions, its percentage ownership of PictureTel's equity. The Stock Purchase and Investor Rights Agreement contemplates a closing by February 17, 1999, subject to satisfaction (or waiver) of specified closing conditions (including completion of due diligence by Intel) and contains indemnification and related provisions relating to the representation and warranties by the parties to the Stock Purchase and Investor Rights Agreement. The terms of the new Series A Preference Stock to be purchased by Intel will be set forth in a Certificate of Designation to be filed by PictureTel in Delaware in connection with the Closing. The Agreement also contains various other ancillary provisions, including those relating to registration rights and information to be provided to Intel in connection with the acquired securities, maintaining the confidentiality of information, notice to Intel and other related provisions in connection with important corporate events of PictureTel, and provisions relating to compliance with the Hart-Scott-Rodino Anti-Trust Improvements Act of 1976, pertaining to any conversion by Intel into PictureTel Common Stock. 5 A copy of the Stock Purchase and Investor Rights Agreement will be filed with the PictureTel Report on Form 10-K for the year ending December 31, 1998, to be filed in March 1999. Item 7. Financial Statement and Exhibits. (c) Exhibits 99.1. Press release dated January 19, 1999 99.2. Press release dated January 19, 1999 6 SIGNATURE Pursuant to 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. PICTURETEL CORPORATION /s/ Arthur L. Fatum ------------------------------------------ Arthur L. Fatum Vice President and Chief Financial Officer (Principal Financial Officer) January 22, 1999 EX-99.1 2 PRESS RELEASE RE: ACCELERATED GROWTH 1 Exhibit 99.1 INTEL, PICTURETEL TEAM TO ACCELERATE GROWTH OF VIDEOCONFERENCING COMPANIES TO JOINTLY DEVELOP NEW PC-BASED PRODUCTS; INTEL TO INVEST $30.5 MILLION IN PICTURETEL HILLSBORO, Ore., - Jan. 19, 1999 - Intel Corporation and PictureTel Corporation (Nasdaq: PCTL) announced today that they have entered into a distribution and joint product development agreement to accelerate growth of videoconferencing worldwide. Intel also will invest $30.5 million in PictureTel. In combining their respective strengths in PC technology innovation and visual collaboration, the two companies will develop high-quality PC-based solutions for customers' diverse communication needs and make it easier for customers to access global services and support. The jointly developed products will take advantage of rapidly emerging markets and technologies, including the next-generation Internet, broadband, cable modems, XDSL, and others. The companies expect the result of their collaboration to be a larger, more competitive videoconferencing industry that distributes products and building blocks through a wider range of channels. Under terms of the agreement, Intel will provide PictureTel with distribution rights to sell the Intel(R) ProShare(R) Video System 500, and exclusive worldwide distribution rights to sell and support the Intel TeamStation(TM) System. In addition to its expertise in videoconferencing distribution, sales and marketing, PictureTel will provide its complete line of professional, managed and maintenance support services for both products. These Intel products augment PictureTel's existing product line of group, compact and desktop videoconferencing systems. Intel and PictureTel also agreed to begin joint development of videoconferencing and collaboration products based on a common PC-based technology platform. The common platform will be the foundation for future products that will feature communication and multimedia capabilities such as collaboration over - more - 2 INTEL, PICTURETEL, p. 2 LANs, streaming audio and video, and real-time conferencing. The full benefits of this joint development agreement can be expected in the year 2000. These future products - which will operate over multiple networks, including IP, ISDN and ATM - will complement PictureTel's existing product line and will be marketed under the PictureTel brand name. Intel plans to market the resulting building-block components to other manufacturers and integrators. "Through the strength of PictureTel's global distribution and service network, we expect a significant worldwide increase in the use of PC-based videoconferencing products," said Gerhard H. Parker, executive vice president of Intel and general manager of the New Business Group. "We are delighted to have the global leader in visual collaboration embrace the PC architecture as the core building-block for emerging videoconferencing solutions." The alliance will create the world's most comprehensive and widely distributed visual collaboration solutions, which will be easier for customers to deploy and use. "The combination of Intel's market-leading PC technology and PictureTel's global leadership in visual collaboration applications will propel videoconferencing forward into the new millennium," said Bruce R. Bond, chairman and CEO of PictureTel. "By working together to develop new products and market segments, we will deliver the solutions that will enable customers around the world to use visual collaboration in their mission-critical activities and make their businesses more productive." ABOUT INTEL TEAMSTATION SYSTEM Intel TeamStation System is a conference room workstation that combines videoconferencing, Internet access, corporate network access and PC applications in one convenient system. Based on the Intel Pentium(R) II processor, the Intel TeamStation is a turnkey, high-performance system that brings increased productivity to conference rooms. Current manufacturer's suggested retail price (MSRP) for the Intel TeamStation System with 128 Kbps capability is $8,999, and $11,999 for 384 Kbps capability. - more - 3 INTEL, PICTURETEL, p. 3 ABOUT INTEL PROSHARE VIDEO SYSTEM 500 Intel ProShare Video System 500 is an add-in kit for desktop PCs. Priced at $799 (U.S. dollars) MSRP, it provides excellent audio and video quality over both ISDN and LAN transports, and offers fully integrated data-sharing capabilities. With its single-board design, Intel ProShare Video System 500 can be installed in approximately 30 minutes. ABOUT PICTURETEL PictureTel Corporation is the world leader in developing, manufacturing and marketing a full range of visual- and audio-collaboration solutions. The company's systems meet customers' collaboration needs from the desktop to the boardroom. PictureTel also markets network conferencing servers and a comprehensive portfolio of enterprisewide services. PictureTel collaboration products and services eliminate the barrier of distance, enabling people to be Anywhere Now(TM). Additional PictureTel information is available on the Internet at www.picturetel.com. ABOUT INTEL Intel, the world's largest chip maker, is also a leading manufacturer of computer, networking and communications products. Additional information about Intel is available at www.intel.com/pressroom. - End - *Third party marks and brands are property of their respective holders. Intel, ProShare, and Pentium are registered trademarks and TeamStation is a trademark of Intel Corporation. PictureTel is a registered trademark and Anywhere Now is a trademark of PictureTel Corporation. EX-99.2 3 PRESS RELEASE RE: FURTHER DETAILS 1 Exhibit 99.2 Contact: Tom Waldrop Kevin Flanagan Intel Corporation PictureTel Corporation (408) 765-8478 (978) 292-5178 tom.waldrop@intel.com flanagank@pictel.com INTEL AND PICTURETEL PROVIDE FURTHER DETAILS REGARDING INVESTMENT SANTA CLARA, Calif., - Jan. 19, 1999 - Earlier today Intel Corporation and PictureTel Corporation (Nasdaq: PCTL) announced that they have entered into a distribution and joint product development agreement to accelerate growth of videoconferencing worldwide. It was also announced that Intel would invest $30.5 million in PictureTel. In connection with the investment, Intel and PictureTel entered into an agreement pursuant to which Intel would make a $30.5 million investment for nonvoting Series A convertible preferred stock, comprising approximately 10 percent of PictureTel's outstanding equity after the investment. The preferred stock is convertible into PictureTel common stock on a one-for-one basis. The closing of the transaction is subject to customary dosing conditions, including the completion of due diligence to Intel's satisfaction. The transaction is expected to close on or before February 17, 1999. Intel, the world's largest chip maker, is also a leading manufacturer of computer, networking and communications products. Additional information about Intel is available at www.intel.com/pressroom. PictureTel Corporation is the world leader in developing, manufacturing and marketing a full range of visual- and audio-collaboration solutions. The company's systems meet customers' collaboration needs from the desktop to the boardroom. PictureTel also markets network conferencing servers and a comprehensive portfolio of enterprise-wide services. PictureTel collaboration products and services eliminate the barrier of distance, enabling people to be Anywhere Now(TM). Additional PictureTel information is available on the Internet at www.picturetel.com. - End- PictureTel is a registered trademark and Anywhere Now is a trademark of Picture Tel Corporation. Other brands or products are trademarks or registered trademarks of their respective owners. -----END PRIVACY-ENHANCED MESSAGE-----