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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

 

Date of Report (Date of earliest event reported):  January 10, 2020

 

INPHI CORPORATION

(Exact name of registrant as specified in its charter)

 

001-34942
(Commission File Number)

Delaware

 

77-0557980

(State or other jurisdiction of

 

(I.R.S. Employer Identification No.)

incorporation)

 

 

 

2953 Bunker Hill Lane, Suite 300, Santa Clara, California 95054

(Address of principal executive offices, with zip code)

 

 

(408) 217-7300
(Registrant’s telephone number, including area code)

 

N/A
(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 obligations of the registrant under any of the following provisions:

 

☐     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))

 

 Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.001 par value per share

IPHI

The New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).

 

Emerging Growth Company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

-1-
 

 

Item 2.01.           Completion of Acquisition or Disposition of Assets.

 

On January 10, 2020, Inphi Corporation (the “Company”) completed the previously announced acquisition of eSilicon Corporation, a Delaware Corporation (“eSilicon”), pursuant to an Agreement and Plan of Merger (the “Merger Agreement”) dated November 10, 2019, and amended on January 10, 2020, by and among the Company, Einstein Acquisition Sub, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub”), eSilicon and Fortis Advisors LLC, a Delaware limited liability company, solely in its capacity as Securityholders’ Agent. Pursuant to the terms of the Merger Agreement, Merger Sub merged with and into eSilicon and eSilicon is the surviving corporation and wholly owned subsidiary of the Company (the “Merger”).

 

At the closing of the Merger, pursuant to the Merger Agreement, the Company paid approximately $216 million in cash, subject to certain adjustments including for cash, debt, working capital and transaction expenses, as well as the assumption of certain liabilities at the closing of the Merger. A portion of the consideration was placed into an escrow fund for 12 months (or up to 36 months in certain circumstances) following the closing for the satisfaction of certain indemnification obligations. In connection with the Merger, eSilicon sold its Vietnamese and Indian subsidiaries to Synopsys, Inc. prior to closing the Merger.

 

The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which was originally filed as an exhibit to the Company’s Current Report on Form 8-K filed on November 12, 2019, and which is incorporated into this Item 2.01 by reference.

 

Item 7.01  Regulation FD Disclosure.

 

On January 13, 2020, the Company issued a press release announcing the completion of the Merger. A copy of the release is filed herewith as Exhibit 99.1 and is incorporated herein by reference. The information in this Form 8-K under Item 7.01 and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific referencing in such filing.

 

Item 9.01           Financial Statements and Exhibits.

 

(a) Financial statements of businesses acquired.

 

The financial statements of eSilicon required by Regulation S-X will be filed by an amendment to this Form 8-K. The amendment will be filed with the Securities and Exchange Commission (the “Commission”) no later than 71 calendar days after the date this Form 8-K is required to be filed with the Commission.

 

(b) Pro forma financial information.

 

The pro forma financial information required by Regulation S-X will be furnished by an amendment to this Form 8-K. The amendment will be filed with the Commission no later than 71 calendar days after the date this Form 8-K is required to be filed with the Commission.

 

(d) Exhibits

 

Exhibit

 

Description

No.    

 

2.1

Agreement and Plan of Merger dated as of November 10, 2019 by and among the Registrant, Einstein Acquisition Sub, Inc., a Delaware corporation and wholly owned subsidiary of the Registrant, eSilicon Corporation, a Delaware corporation, and Fortis Advisors LLC, a Delaware limited liability company, solely in its capacity as Securityholders’ Agent (filed as Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed on November 12, 2016, and incorporated herein by reference).*

 

2.2

Amendment No. 1 to Agreement and Plan of Merger dated January 10, 2020.

 

99.1

Press release dated January 13, 2020

 

104

Cover Page Interactive Data File (formatted as Inline XBRL).

 

_____________

* The Company hereby undertakes to furnish supplementally a copy of any omitted schedule or exhibit to such agreement to the U.S. Securities and Exchange Commission upon request.

 

-2-
 

 

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.

 

Date: January 13, 2020

 

 

 

INPHI CORPORATION

 

 

 

 

 

 

 

 

 

 

By:  

/s/ Richard Ogawa

 

 

 

 

Richard Ogawa

 

 

 

General Counsel

 

-3-

Exhibit 2.2

 

AMENDMENT NO. 1 TO
AGREEMENT AND PLAN OF MERGER

January 10, 2020

 

This Amendment No. 1, dated as of January 10, 2020 (this “Amendment”), to the Agreement and Plan of Merger, dated November 10, 2019 by and among Inphi Corporation, a Delaware corporation (“Acquiror”), Einstein Acquisition Sub, Inc., a Delaware corporation (“Merger Sub”) and wholly owned Subsidiary of Acquiror, eSilicon Corporation, a Delaware corporation (“Target”) and Fortis Advisors LLC, a Delaware limited liability company, solely in its capacity as the securityholders’ representative (“Securityholders’ Agent”) (the “Agreement”). Capitalized terms not defined herein shall have the meanings given in the Agreement.

 

RECITALS

 

WHEREAS, the parties hereto desire to amend the Agreement as set forth herein; and

 

WHEREAS, pursuant to Section 10.10 of the Agreement, any term or condition of the Agreement can be waived or amended if such waiver or amendment is in writing and duly executed by or on behalf of the party to be charged with such waiver.

 

NOW, THEREFORE, in consideration of the foregoing, the mutual promises set forth herein and for other good and valuable consideration, the receipt of which are hereby acknowledged, the undersigned parties, hereby intending to be legally bound, agree to amend the Agreement as set forth below.

 

AGREEMENT

 

1.                Amendment.

 

(a)         Section 1.1 of the Agreement shall be amended as follows:

 

(i)     The definition of “Per Share Amount” shall be revised to include at the end “, in each case, after taking into account the payment of amounts required to be made to Target’s management pursuant to Target’s Management Retention Plan, as set forth on the Payment Schedule.”

 

(ii)     A new definition shall be added after the definition of “Lease” or “Leases” and shall read as follows:

 

““Management Retention Plan” means Target’s Management Retention Plan adopted by Target’s Board of Directors on March 22, 2019, as amended on December 6, 2019.”

 

(iii)     The definition of “Pro Rata Portion” shall be amended in its entirety to read as follows:

 

““Closing Pro Rata Portion” means with respect to any applicable Effective Time Holder, as set forth in the Payment Schedule.”

 

1
 

 

(iv)     A new definition shall be added after “Closing Pro Rata Portion” and shall read as follows:

 

““Indemnification Pro Rata Portion” means with respect to any applicable Effective Time Holder, as set forth in the Payment Schedule.”

 

(b)         Section 2.10(b)(i) of the Agreement shall be amended and restated such that the last phrase which refers to Pro Rata Portion reads in its entirety as follows:

 

“…the Closing Pro Rata Portion and Indemnification Pro Rata Portion of each applicable Effective Time Holder, each stated as a percentage…”

 

(c)          Section 2.11(c)(i), Section 2.11(c)(ii), Section 9.1(a), Section 9.1(b), Section 9.1(c) and Section 9.1(d) shall be amended such that the reference to “Pro Rata Portion” shall be changed to “Closing Pro Rata Portion.”

 

(d)          Section 6.10(f) shall be amended such that the retention pool of “$5,000,000 in cash” shall instead read as follows: “at least $5,000,000 in cash.”

 

(e)          The last sentence of Section 9.1(a) shall be amended in its entirety to read as follows:

 

“The Escrow Consideration will be held by the Escrow Agent for the periods provided herein and in the Escrow Agreement, and any Escrow Consideration to be distributed to any Effective Time Holders shall be distributed in accordance with such Effective Time Holder’s Closing Pro Rata Portion, in each case, after taking into account the payment of amounts required to be made to Target’s management pursuant to Target’s Management Retention Plan, as set forth on the Payment Schedule.”

 

(f)           A new Section 9.1(e) shall be added to read as follows:

 

“Any unused portion of the Retention Amount shall remain in the Escrow Fund until such date as Acquiror is no longer able to make claims pursuant to the R&W Insurance Policies, or until the resolution of any timely claim made pursuant to the R&W Insurance Policies, whichever is later. Any unused portion of the Retention Amount, once eligible for release to the Effective Time Holders, shall be distributed to the Effective Time Holders in accordance with their Closing Pro Rata Portion.”

 

(g)         Section 9.2(a), Section 9.2(c), Section 9.5(b), and Section 9.9 shall be amended such that the reference to “Pro Rata Portion” shall be changed to “Indemnification Pro Rata Portion.”

 

2
 

 

(h)         The last sentence of 9.5(c) shall be amended to read in its entirety as follows:

 

“As soon as reasonably determined by the Securityholders’ Agent that the Expense Fund is no longer required to be withheld, the Securityholders’ Agent shall distribute the remaining Expense Fund (if any) to the Payment Agent and/or Acquiror, as applicable, for further distribution to the Effective Time Holders in accordance with their Closing Pro Rata Portion, after taking into account the payment of amounts required to be made to Target’s management pursuant to Target’s Management Retention Plan, as set forth on the Payment Schedule.”

 

2.              All references to “this Agreement” in the Agreement shall mean the Agreement as amended by this Amendment. References in the Agreement to provisions “herein” or attachments “hereto” shall include the provisions of this Amendment.

 

3.            This Amendment, together with the Agreement and all exhibits and schedules thereto, and the Confidentiality Agreement, constitute the entire agreement, and supersede all other prior agreements and understandings, both written and oral, between the parties, or any of them, with respect to the subject matter hereof and thereof, and this Amendment is not intended to grant standing to any Person other than the parties hereto.

 

4.            This Amendment shall not constitute an amendment or waiver of any provision of the Agreement not expressly amended or waived herein and shall not be construed as an amendment, waiver or consent to any action that would require an amendment, waiver or consent except as expressly stated herein. The Agreement, as amended by this Amendment, is and shall continue to be in full force and effect.

 

5.             The provisions of Section 10 of the Agreement shall apply to this Amendment mutatis mutandis unless otherwise modified herein.

 

[signature page follows]

 

3
 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to Agreement and Plan of Merger to be duly executed by their respective authorized officers as of the day and year first above written.

 

 

 

INPHI CORPORATION

 
   
   

By:    /s/ Richard Ogawa                                     

 

Richard Ogawa, General Counsel

 
   
   

EINSTEIN ACQUISITION SUB, INC.

 
   
   
By:    /s/ Richard Ogawa                                       

Richard Ogawa, President and Chief Executive Officer

 

 

 

[Signature Page to Merger Agreement Amendment]

 

 
 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to Agreement and Plan of Merger to be duly executed by their respective authorized officers as of the day and year first above written.

 

 

ESILICON CORPORATION

 

 

By:    /s/ Jack Harding                                    

Jack Harding, President and Chief Executive Officer

 

 

[Signature Page to Merger Agreement Amendment]

 

 
 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to Agreement and Plan of Merger to be duly executed by their respective authorized officers as of the day and year first above written.

 

 

 

SECURITYHOLDERS’ AGENT

 
 

By:   /s/ Ryan Simkin                                       
 Ryan Simkin, Managing Director

 

 

[Signature Page to Merger Agreement Amendment]

Exhibit 99.1

 

 

 

Inphi Completes Acquisition of eSilicon

 

Further Solidifies Inphi’s Market Leadership and Scale in High-Performance Electro-Optics

 

SANTA CLARA, Calif., January 13, 2020 – Inphi Corporation (NYSE: IPHI), a leader in high-speed data movement interconnects, today announced that it has completed the acquisition of eSilicon, as announced on November 11, 2019, in a transaction valued at approximately $216 million in both cash and the assumption of debt.

 

“We are pleased to complete the acquisition of eSilicon,” said Ford Tamer, President and CEO of Inphi Corporation. “We welcome eSilicon to the Inphi family and are excited to advance our shared commitments in driving successful customer engagement, industry-leading innovation, and best of class execution.”

 

Inphi believes this acquisition will further reinforce its premier positioning in data center interconnects, expand its presence into strategic geographic regions for talent acquisition and accelerate its strategic roadmap in developing electro-optics solutions for our Cloud and telecom customers.

 

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements contain words such as "believe," "will," and "expect," or the negative thereof or comparable terminology, and include (without limitation) statements regarding the acquisition of eSilicon and expectations regarding the impact thereof, including impact on market position, talent acquisition, strategic roadmap and addressable market, as well as the financial impacts of the acquisition. Forward-looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in any such statement. These risks include, but are not limited to: Inphi’s ability to successfully integrate the two companies, including retention of key personnel of eSilicon and maintaining sales to existing eSilicon customers, the impact on Inphi’s financial performance, the ability to extend product offerings into new areas or products, the ability to commercialize technology, unexpected occurrences that deter the full documentation and "bring to market" plan for products, trends and fluctuations in the industry, changes in demand and purchasing volume of customers, unpredictability of suppliers, the ability to attract and retain qualified personnel, the ability to move product sales to production levels, the ability to compete for client design-in opportunities, the ability to cross-sell to new clients and to diversify, and the success of product sales in new markets or of recently produced product offerings, including bundled product solutions. Additional factors that could cause actual results to differ are discussed under the heading "Risk Factors" and in other sections of the Inphi filings with the SEC, and in its other current and periodic reports filed or furnished from time to time with the SEC. All forward-looking statements in this press release are made as of the date hereof, based on information available to Inphi as of the date hereof, and Inphi assumes no obligation to update any forward-looking statement.

 

 
 

 

About Inphi
Inphi Corporation is a leader in high-speed data movement interconnects. We move big data fast, throughout the globe, between data centers, and inside data centers.  Inphi's expertise in signal integrity results in reliable data delivery, at high speeds, over a variety of distances. As data volumes ramp exponentially due to video streaming, social media, cloud-based services, and wireless infrastructure, the need for speed has never been greater. That's where we come in. Customers rely on Inphi's solutions to develop and build out the Service Provider and Cloud infrastructures, and data centers of tomorrow. To learn more about Inphi, visit www.inphi.com.

 

# # #

 

Inphi, the Inphi logo and Think fast are registered trademarks of Inphi Corporation. All other trademarks used herein are the property of their respective owners.

 

 

Investor Contact:

Vernon P. Essi, Jr.

408-606-6524

vessi@inphi.com

 

Corporate Contact:

Kim Markle

408-217-7329

kmarkle@inphi.com