Pursuant to Rule 425
under the Securities Act of 1933 and
deemed filed pursuant to Rule 14d-2(b) under
the Securities Exchange Act of 1934
Filing Person: Networks Associates, Inc.
Subject Company: McAfee.com Corporation
Subject Company's Commission File No.: 00-28247
Date: March 18, 2002
The following are certain questions and answers prepared by Network Associates,
Inc. in connection with the proposed exchange offer announced by Network
Associates, Inc. on March 18, 2002, for all outstanding shares of McAfee.com
Class A common stock:
QUESTIONS AND ANSWERS ABOUT THE OFFER
The following are answers to some questions about Network Associates'
announcement of its planned offer to purchase all outstanding publicly held
shares of McAfee.com Corporation's common stock. Network Associates intends to
file an exchange offer prospectus and related materials with the Securities and
Exchange Commission (the "Offer Documents") on or about March 25, 2002, for
complete answers to these and other questions related to the offer and merger
you should read the Offer Documents in their entirety.
Q: WHY IS NETWORK ASSOCIATES MAKING THE OFFER?
A: We currently own 36,000,000 shares of McAfee.com Class B common stock. These
shares represent approximately 75% of all the outstanding McAfee.com common
stock. Our offer would be intended to acquire all the outstanding shares of
McAfee.com's Class A common stock, none of which we own, in order to recombine
Network Associates and McAfee.com.
The offer will be conditioned on the tender of a sufficient number of shares of
McAfee.com Class A common stock such that, after the offer is completed, we
would own at least 90% of all the outstanding shares of McAfee.com common stock.
If the conditions to the offer are met and the offer is completed, as soon as
practicable thereafter, we will effect a "short-form" merger of McAfee.com and
our wholly-owned subsidiary, unless it is not lawful to do so.
Q: WHAT WILL MCAFEE.COM STOCKHOLDERS RECEIVE IN EXCHANGE FOR THEIR SHARES?
A: For each outstanding share of McAfee.com Class A common stock validly
tendered and not properly withdrawn, the stockholder will receive 0.675 shares
of Network Associates common stock. McAfee.com stockholders will also receive
the cash equivalent to any fractional Network Associates shares. Based on the
$27.61 closing price of Network Associates shares on March 15, 2002, our offer
represents a value of approximately $18.64 per McAfee.com share, or a 20%
premium to the closing price of McAfee.com stock on that date.
Q: WHAT REASONS DOES NETWORK ASSOCIATES HAVE FOR MAKING THE OFFER?
A: Since early 2001, we have taken a number of steps to focus our business on
our core strengths, and to eliminate overlapping objectives between our business
units. This recombination is consistent with that strategy. We believe that the
recombination would significantly reduce customer and market confusion due to
the similarity of our products and services. In addition, the move would help us
to more efficiently and effectively target the consumer and small and mid-sized
business marketplace, and may reduce overall costs of the combined businesses.
Q: WHAT PERCENTAGE OF NETWORK ASSOCIATES COMMON STOCK WOULD MCAFEE.COM
STOCKHOLDERS RECEIVE IN THE OFFER AND THE MERGER?
A: McAfee.com stockholders (other than Network Associates) currently own
approximately 25% of McAfee.com. We anticipate that McAfee.com stockholders
(other than Network Associates) would own approximately 5% of Network
Associates' outstanding common stock after giving effect to the offer and
merger.
Q: WHEN DOES NETWORK ASSOCIATES EXPECT TO COMPLETE THE OFFER AND THE MERGER?
A: If commenced on March 25, 2002, we hope to complete the offer on April 19,
2002. We expect to complete the merger as soon as practicable thereafter.
Q: HOW WILL MCAFEE.COM EMPLOYEE STOCK OPTIONS BE TREATED IN CONNECTION WITH THE
OFFER AND MERGER?
A: If the offer and merger are completed, McAfee.com employee stock options will
be assumed by Network Associates. Holders of McAfee.com options will receive
stock options for Network Associates common stock with substantially similar
terms based on the exchange ratio.
Q: IF COMPLETED, WHAT IS THE EXPECTED IMPACT OF THE OFFER AND MERGER ON
OPERATING RESULTS FOR THE CONSOLIDATED COMPANY?
A: Based on previously announced 2002 expected operating results, we expect the
offer and merger will result in a $0.01 per share reduction in the 2002 pro
forma earnings per share of the consolidated entity. Pro forma earnings for the
consolidated entity include Network Associates and McAfee.com operating results
and exclude interest and amortization expense, compensation charges relating to
employee stock options and one-time charges.
Q: ARE YOU CONFIRMING EARLIER GUIDANCE FOR NETWORK ASSOCIATES OR MCAFEE.COM?
A. No. The 2002 guidance for Network Associates was provided earlier this
year. We do not expect to provide further guidance regarding Network Associates
operating results until after we announce our actual results for the quarter
ending March 31, 2002. We believe the same is true for McAfee.com.
Q: WHAT ARE POSSIBLE COST SAVINGS OF THE OFFER AND MERGER?
A: We expect to have some cost savings, but have not quantified them yet. An
example would be not having to operate two public companies.
Q: DOES THE OFFER AND MERGER PRECLUDE OTHER NET OPTIONS TO ACQUIRE MCAF STOCK?
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A: We intend to acquire shares pursuant to the offer. If the offer is not
completed, we may acquire shares of McAfee.com in public or private transactions
to get our ownership to 90% to effect a "short-form" merger or McAfee.com may
remain a separate publicly traded company.
Q: WILL THERE BE EMPLOYEE AND PRODUCT CHANGES RESULTING FROM THE OFFER AND
MERGER?
A: We have made no determinations as of yet. For now, both companies will
continue to be operated separately, and we will continue to evaluate how to
smoothly reintegrate McAfee.com's employees and offerings.
Q: HAS NETWORK ASSOCIATES NEGOTIATED THE OFFER WITH MCAFEE.COM?
A: No. The offer is being made directly to McAfee.com stockholders. The offer
does not require, and we are not seeking, approval of the offer by McAfee.com or
its board. We encourage each McAfee.com stockholder to evaluate our offer for
themselves.
Q: WHAT ELSE CAN YOU TELL US ABOUT THE OFFER?
A: On March 25, 2002, we intend to file the Offer Documents with the Securities
and Exchange Commission. The Offer Documents will contain detailed information
concerning the offer and merger.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed transaction, Network Associates will file
an exchange offer prospectus and related materials with the Securities and
Exchange Commission. INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THIS
DOCUMENT AND RELATED MATERIALS WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL
CONTAIN IMPORTANT INFORMATION. Investors and security holders may obtain a free
copy of the exchange offer prospectus (when available) and other documents filed
by Network Associates with the Commission at the Commission's web site at
http://www.sec.gov. Free copies of the exchange offer prospectus (when
available) as well as Network Associates' related filings made with the
Commission, may also be obtained from Network Associates by directing a request
to Network Associates Investor Relations, at 3965 Freedom Circle, Santa Clara,
California, 95054.
SAFE HARBOR STATEMENT
The foregoing document contains forward-looking statements. Forward-looking
statements include those regarding Network Associates' exchange offer, the
anticipated benefits of the recombination of Network Associates and McAfee.com,
expected operating results for 2002 and the financial impact of the exchange
offer on 2002 pro forma operating results for the consolidated entity. Neither
Network Associates nor McAfee.com has updated prior guidance as to expected 2002
operating results, and the statements in this document should not be construed
as an update of such guidance. Actual results may vary, perhaps materially, from
those contained in the forward-looking statements and the expected results may
not occur. Actual operating results for Network Associates and McAfee.com may
differ from prior guidance. Network Associates may not realize the expected
benefits from the recombination with McAfee.com and, if the offer and merger
occur, 2002 pro forma operating results for the consolidated entity may be
impacted by more than $0.01 per share. Network Associates may not commence or
complete the exchange offer or merger described in this document. Investors
should read Network Associates' prospectus and tender offer statement, when
these documents are available, describing the proposed exchange offer and merger
and the documents
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incorporated therein for a more detailed discussion of the offer and merger and
the associated risks and uncertainties. Network Associates is under no
obligation and does not intend to update any of these forward-looking
statements, even if experience or future changes make it clear that any proposed
results experienced or implied therein will not be realized.
Additional Information
In connection with the exchange offer, Network Associates, Inc. expects to
file an exchange offer prospectus and a registration statement on Form S-4 with
the Securities and Exchange Commission. INVESTORS AND STOCKHOLDERS ARE ADVISED
TO READ THESE AND ALL RELATED DOCUMENTS, WHEN AVAILABLE, BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION RELATING TO THE EXCHANGE OFFER. Investors and
stockholders may obtain a free copy of the exchange offer prospectus, the
registration statement and related documents, when available, from the
Securities and Exchange Commission's web site at http://www.sec.gov. Free copies
of these documents may also be obtained from Parent, when available, by
directing a request to the information agent, D.F. King & Co., Inc., 77 Water
Street, New York, NY 10005, 1-888-414-5566.
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