Filed by Datron Systems Incorporated pursuant to Rule
425 under the Securities Act of 1933 and deemed filed
under Rule 14d-9(a) of the Securities Exchange Act of 1934
Subject Company: Datron Systems Incorporated
Commission File No. 0-7445
DATRON SYSTEMS AGREES TO BE ACQUIRED
BY THE TITAN CORPORATION
VISTA, CA - June 25, 2001 - Datron Systems Incorporated
(Nasdaq: DTSI) today announced it has entered into a definitive
agreement to be acquired by The Titan Corporation (NYSE: TTN), a
leading-edge technology company that creates, builds and launches
technology-based businesses, for approximately $51 million, or
$16.00 per fully-diluted share, in Titan common stock. Datron
common stock closed at $14.00 on Friday, June 22, 2001.
Consummation of the transaction, which will be accounted for as a
purchase, is subject to customary closing conditions, will
include a tender for exchange of at least a majority of Datron's
outstanding shares, and is expected to close by the end of
Datron's second quarter, September 30, 2001.
Commenting on the announcement, David A. Derby, Datron
Systems' chairman, president and chief executive officer, stated,
"We are firmly committed to maximizing the tremendous growth
potential of Datron's mobile broadband communications and public
safety wireless network markets, the continued growth of our
radio communications products and the resurgence of our satellite
antenna systems business. We believe Titan's e-tenna subsidiary,
which is developing unique radio frequency technologies, its
radio communications business, familiarity with long-term
government contracting as well as its size and distribution
capabilities are a strategic fit for Datron that will enable the
combined companies to better pursue the growth opportunities in
these markets.
"With its patented antenna technology, Datron has
established a strong leadership position in the emerging market
of providing broadband satellite data to airliners worldwide. We
were first to fly on a commercial airliner nearly five years ago
and have maintained our technological and market lead through the
protracted maturation of this market. The added strength
provided by Titan sharply improves the probability that Datron's
substantial investments in this arena will lead to additional
growth opportunities in the airborne broadband market."
Under terms of the definitive agreement, Titan will first
commence an exchange offer for all of the outstanding shares of
Datron common stock. The exchange offer will be followed by a
merger in which Titan will acquire, at the same exchange ratio,
the remaining shares of Datron not previously acquired in the
exchange offer. All outstanding options to acquire Datron common
stock will be assumed by Titan and converted into the right to
purchase shares of Titan common stock.
Also under terms of the definitive agreement, which has been
approved by the Board of Directors of both companies, Datron
stockholders and option holders are expected to receive a total
equity value of approximately $51 million if Titan's ten-day
average closing share price is equal to or greater than $19.00
and less than or equal to $26.00 per share at the price
determination date, which is five (5) trading days prior to the
expiration of the initial offering period. If Titan's average
closing share price is equal to or greater than $17.50 and less
than $19.00, the equity value will decrease ratably from
approximately $51 million to approximately $47 million. At a
Titan average closing share price of less than $17.50, Datron has
the right to terminate the definitive agreement subject to a
Titan option to assure a minimum equity value of approximately
$46 million. If Datron does not elect to terminate if the average
closing share price is less than $17.50, the equity value would
be less than $46 million. If Titan's average closing share price
is greater than $26.00 and equal to or less than $27.50, the
equity value will increase ratably from approximately $51 million
to approximately $54 million. At a Titan average closing share
price of more than $27.50, Titan has the right to terminate the
definitive agreement subject to a Datron option to agree to
receive a maximum equity value of approximately $56 million.
Philpott Ball & Werner is acting as financial advisor to Datron
on the transaction.
The foregoing summary is a general description of certain
pricing and related terms contained in the definitive agreement
for the transaction, and is qualified in its entirety by
reference to the definitive agreement, a copy of which will be
filed with the Securities and Exchange Commission.
ADDITIONAL INFORMATION
Titan intends to file a Registration Statement on Form S-4
and Schedule TO, and Datron plans to file a
Solicitation/Recommendation Statement on Schedule 14D-9, with the
Securities and Exchange Commission in connection with the
transaction. Titan and Datron expect to mail a Prospectus, the
Schedule 14D-9 and related tender offer materials to stockholders
of Datron. These documents contain important information about
the transaction. Investors and security holders are urged to
read these documents carefully when they are available.
Investors and security holders will be able to obtain free copies
of these documents through the website maintained by the U.S.
Securities and Exchange Commission at www.sec.gov. Free copies
of these documents may also be obtained from Datron by directing
a request to the Investor Relations section of Datron's website
at www.dtsi.com or by mail to Datron Systems, 3030 Enterprise
Court, Vista, CA 92083, Attention: Investor Relations, telephone
(760) 734-5454.
In addition to the Registration Statement, Schedule TO,
Prospectus and Schedule 14D-9, Titan and Datron file annual,
quarterly and other reports, proxy statements and other
information with the Securities and Exchange Commission. You may
read and copy any reports, statements or other information filed
by Titan or Datron at the SEC public reference room at 450 Fifth
Street, N.W., Washington, D.C. 20549 or any of the commission's
other public reference rooms in New York, N.Y. and Chicago, IL.
Please call the Securities and Exchange Commission at 800-SEC-
0330 for further information on the public reference rooms.
Titan's and Datron's filings with the Securities and Exchange
Commission are also available to the public from commercial
document-retrieval services and at the website maintained by the
commission at http://www.sec.gov.
The Titan Corporation
Headquartered in San Diego, The Titan Corporation creates,
builds and launches technology-based businesses, offering
innovative technical solutions. Three of Titan's four core
businesses develop and deploy communications and information
technology solutions and services. In addition, Titan's SureBeam
(Nasdaq: SURE) subsidiary markets the leading technology for the
electronic pasteurization of food products and Titan is
continually identifying promising technologies suitable for
commercialization. The company has 7,800 employees and annualized
sales of approximately $1.1 billion.
Datron Systems Incorporated
Datron Systems provides products and services addressing the
needs of emerging satellite and radio communication markets. From
facilities in Simi Valley and Vista, California, the Company
supplies satellite tracking antenna systems, earth stations, and
voice and data communication radios to worldwide markets. Datron
was the first company to bring live satellite TV to passengers on
a commercial airline and is now uniquely positioned as a provider
of broadband satellite tracking antennas for mobile customers in
the land, sea and air markets. Datron is playing a vital
leadership role in the broadband revolution that will see a
seamless convergence of voice, video and data services.
This release may contain "forward-looking statements" as
defined in the Private Securities Litigation Reform Act of 1995.
A variety of factors could cause the Company's actual results to
differ from the anticipated results expressed in such forward-
looking statements. These include, among others, uncertainties
stemming from the dependence of the Company on foreign sales and
on large orders from a relatively small number of customers,
risks relating to the decline in the Company's traditional
defense business and the Company's efforts to develop and market
consumer products, lack of timely development or customer
acceptance of new products, changes in or unavailability of
products and services offered by satellite service providers and
their related suppliers, worldwide economic downturns and
currency devaluations, restrictions that may be imposed by the
U.S. government on the export of Company products, and the impact
of competition. For more information, please review the Company's
periodic reports under the Securities Exchange Act of 1934,
including without limitation the Investment Considerations set
forth in the Company's Annual Report on Form 10-K.
CONTACT: William L. Stephan
Chief Financial Officer
(760) 734-5454
www.dtsi.com
Tripp Sullivan
CORPORATE COMMUNICATIONS, INC.
(615)254-3376
tripp.sullivan@cci-ir.com