EX-99.1 7 f71565ex99-1.txt EXHIBIT 99.1 1 EXHIBIT 99.1 INKTOMI CORPORATION PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION INDEX TO INKTOMI CORPORATION PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

Inktomi Corporation Pro Forma Condensed Consolidated Financial Information Pro Forma Condensed Consolidated Financial Information 74 Pro Forma Condensed Consolidated Statement of Operations for the Year Ended September 30, 2000 (Unaudited) 75 Pro Forma Condensed Consolidated Statement of Operations for the Three-Months Ended December 31, 2000 (Unaudited) 76 Pro Forma Condensed Consolidated Balance Sheet as of December 31, 2000 (Unaudited) 77 Notes to the Unaudited Condensed Consolidated Pro Forma Financial Information 78

73 2 INKTOMI CORPORATION PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION The following unaudited pro forma condensed consolidated financial information for Inktomi Corporation (the "Company" or "Inktomi") gives effect to the divestiture of Commerce Division ("Commerce") by Inktomi Corporation (the "Divestiture"). The unaudited pro forma condensed consolidated statements of operations for the year ended September 30, 2000 and for the three-months ended December 31, 2000 give pro forma effect to the Divestiture and related pro forma accounting adjustments, as if the Divestiture and related transactions had occurred on October 1, 1999, the beginning of fiscal year 2000. The unaudited pro forma condensed consolidated balance sheet as of December 31, 2000 gives pro forma effect to the Divestiture and related pro forma accounting adjustments, as if the Divestiture and related transactions had occurred on December 31, 2000. The adjustments relating to the Divestiture and other adjustments are described in the notes to the unaudited pro forma condensed consolidated financial information. 74 3 INKTOMI CORPORATION PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)

FOR THE YEAR ENDED SEPTEMBER 30, 2000 -------------------------------------------------- Inktomi Commerce Pro Forma ------------ ------------ ------------ Revenues Network products $ 152,850 $ -- $ 152,850 Portal services 71,367 14,608 56,759 ------------ ------------ ------------ Total revenues 224,217 14,608 209,609 Operating expenses Cost of revenues 31,884 3,138 28,746 Sales and marketing 129,485 9,931 119,554 Research and development 63,566 12,273 51,293 General and administrative 19,121 956 18,165 Purchased in-process research and development 4,400 -- 4,400 Amortization of intangibles and other assets 13,182 -- 13,182 Acquisition costs 3,999 -- 3,999 ------------ ------------ ------------ Total operating expenses 265,637 26,298 239,339 ------------ ------------ ------------ Operating loss (41,420) (11,690) (29,730) Other income, net 14,080 -- 14,080 ------------ ------------ ------------ Net loss $ (27,340) $ (11,690) $ (15,650) ============ ============ ============ Basic and diluted net loss per share $ (0.24) $ (0.24) ============ ============ Shares used in calculating basic and diluted net loss per share 113,030 113,030 ============ ============

See Notes to the Unaudited Pro Forma Condensed Consolidated Financial Information 75 4 INKTOMI CORPORATION PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)

FOR THE THREE-MONTHS ENDED DECEMBER 31, 2000 -------------------------------------------------- INKTOMI COMMERCE PRO FORMA ------------ ------------ ------------ Revenues Network products $ 54,183 $ -- $ 54,183 Portal services 26,321 5,996 20,325 ------------ ------------ ------------ Total revenues 80,504 5,996 74,508 Operating expenses Cost of revenues 10,034 1,428 8,606 Sales and marketing 47,376 2,311 45,065 Research and development 22,921 3,134 19,787 General and administrative 5,924 543 5,381 Purchased in-process research and development 430 -- 430 Amortization of intangibles and other assets 16,208 -- 16,208 Acquisition costs 19,497 -- 19,497 ------------ ------------ ------------ Total operating expenses 122,390 7,416 114,974 ------------ ------------ ------------ Operating loss (41,886) (1,420) (40,466) Other income, net 3,779 -- 3,779 ------------ ------------ ------------ Net loss $ (38,107) $ (1,420) $ (36,687) ============ ============ ============ Basic and diluted net loss per share $ (0.31) $ (0.31) ============ ============ Shares used in calculating basic and diluted net loss per share 124,452 124,452 ============ ============

See Notes to the Unaudited Pro Forma Condensed Consolidated Financial Information 76 5 INKTOMI CORPORATION PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)

DECEMBER 31, 2000 ------------------------------------------------------------------ INKTOMI COMMERCE ADJUSTMENTS PRO FORMA ------------ ------------ ------------ ------------ Assets Current assets Cash and cash equivalents $ 9,269 $ -- $ -- $ 9,269 Restricted cash 119,616 -- -- 119,616 Short-term investments 182,262 -- -- 182,262 ------------ ------------ ------------ ------------ Total cash, cash equivalents and short-term investments 311,147 -- -- 311,147 Accounts receivable, net 53,365 1,511 688 (a) 52,542 Prepaid expenses and other current assets 8,512 -- 8,512 ------------ ------------ ------------ ------------ Total current assets 373,024 1,511 688 372,201 Investments in equity securities 52,341 -- 19,601 (b) 71,942 Property and equipment, net 89,634 11,827 -- 77,807 Intangibles and other assets 331,914 -- 331,914 ------------ ------------ ------------ ------------ Total assets $ 846,913 $ 13,338 $ 20,289 $ 853,864 ============ ============ ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 14,846 $ 333 $ 9,058 (c) $ 23,571 Accrued liabilities 72,456 1,937 1,937 (a) 72,456 Deferred revenue 44,894 8,015 6,672 (a) 43,551 Current portion of notes payable 2,939 -- -- 2,939 Current portion of capital lease obligations 3,458 -- -- 3,458 ------------ ------------ ------------ ------------ Total current liabilities 138,593 10,285 17,667 145,975 Notes payable, less current portion 1,002 -- -- 1,002 Capital lease obligations, less current portion 1,100 -- -- 1,100 Other liabilities 342 -- 342 ------------ ------------ ------------ ------------ Total liabilities 141,037 10,285 17,667 148,419 Stockholders' equity Total stockholders' equity 705,876 3,053 2,622 (d) 705,445 ------------ ------------ ------------ ------------ Total liabilities and stockholders' equity $ 846,913 $ 13,338 $ 20,289 $ 853,864 ============ ============ ============ ============

See Notes to the Unaudited Pro Forma Condensed Consolidated Financial Information 77 6 INKTOMI CORPORATION NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION DESCRIPTION OF THE TRANSACTION On March 28, 2001, Inktomi Corporation ("Inktomi"), the Registrant, consummated its divestiture of its Commerce Division pursuant to an Asset Purchase Agreement dated as of January 18, 2001 by and between e-centives, Inc. ("e-centives") and Inktomi. Under the agreement, Inktomi sold the business assets of its Commerce Division and e-centives hired certain employees of the Commerce Division. In exchange for the assets, consisting primarily of contracts, intellectual property and computer equipment, Inktomi received 2,551,700 shares of Common Stock of e-centives, of which 382,755 shares are held in escrow pending satisfaction of certain performance criteria, and 627,925 shares are held in escrow subject to claims for indemnity by e-centives. Inktomi also received a warrant to purchase up to 1,860,577 shares of e-centives on or after March 28, 2006, which will become exercisable upon the achievement of certain performance criteria by the Commerce Division. For the purposes of these pro forma financial statements, no value has been assigned to the warrant or the escrow shares. The value of the warrant and escrow shares will be assigned if and when these contingencies are met. PRO FORMA LOSS ON DISPOSITION The pro forma loss on the disposition of Commerce Division at December 31, 2000 is calculated as follows (in thousands): Consideration received from e-centives $ 19,601 Less transaction costs and accruals remaining with Inktomi $ (8,725) Less Commerce Division assets and liabilities not transferred to e-centives $ (8,254) -------- Proceeds from disposition $ 2,622 Less net book value $ (3,053) -------- Loss on disposition $ (431) ======== PRO FORMA ADJUSTMENTS Pro forma adjustments for the unaudited pro forma condensed consolidated balance sheet as of December 31, 2000 and the unaudited pro forma condensed consolidated statements of operations for the year ended September 30, 2000 and the three-months ended December 31, 2000 are as follows: (a) Represents amounts of Commerce Division that are not transferred to e-centives as a part of the Asset Purchase Agreement. (b) Represents the investment in equity securities value of the 2,168,945 shares of e-centives' Common Stock received by Inktomi (net of the shares subject to performance criteria) as a part of the Asset Purchase Agreement at an approximate value of $9.04 per share (the ten day moving average closing price for e-centives' Common Stock as of December 31, 2000 converted to US Dollars). 78 7 (c) Represents $8,725,000 in transaction costs and accruals incurred by Inktomi in the Divestiture of the Commerce Division, and $333,000 in accounts payable that are not being transferred to e-centives as a part of the Asset Purchase Agreement. The transaction costs and accruals consist primarily of: $4.8 million in severance packages for Commerce Division employees, $1.3 million in accounting, banking and legal fees, $0.6 million in fees associated with the Commerce move to e-centives and $2.0 million in computer equipment and software write-offs and other miscellaneous transaction costs and accruals. (d) Represents the net effect of the consideration received of 2,168,945 shares of e-centives' Common Stock (net of the shares subject to performance criteria) at an approximate value of $9.04 per share (the ten day moving average closing price for e-centives' Common Stock as of December 31, 2000 converted to US Dollars), less the $8,725,000 in transaction costs and accruals incurred by Inktomi in the Divestiture of the Commerce Division and the net effect of all Commerce Division assets and liabilities not transferred to e-centives as a part of the Asset Purchase Agreement. 79