FOR IMMEDIATE RELEASE FILED UNDER RULE 425
BY CYLINK CORPORATION
SEC File No. 0-27742
Contacts:
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Howard Kalt Chris Chillingworth
Kalt Rosen & Co. Chief Financial Officer
414/397-2686 408/855-6102
Kalt@KRC-IR.com cchillin@cylink.com
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ISS Recommends Cylink Shareowners
Vote for Merger With SafeNet
SANTA CLARA, Calif., January 28, 2003 -Cylink Corporation (Nasdaq: CYLK) today
announced that Institutional Shareholder Services Inc. (ISS) -- the nation's
leading independent proxy advisory firm - has recommended that Cylink
shareholders vote to approve the merger of Cylink with SafeNet, Inc. ISS is an
independent expert organization that advises many of the nation's largest
institutional investors on shareholder voting matters. In issuing its report on
the proposed merger between Cylink and SafeNet ISS said, "Based on the market
premium, the fairness opinion rendered by First Analysis, and the potential
strategic synergies, we believe the merger agreement warrants shareholder
support." In addition, the ISS analysis stated that the merger of the two
companies would:
o Represent a significant premium over the closing price of Cylink's
common stock on the last trading day prior to the merger announcement.
o Result in strategic advantages stemming in part from complementary
expertise, that may result in greater growth of the combined company
than the two companies might achieve operating independently
o Combine complementary strengths of the two companies, as well as their
complementary products, services and solutions.
o Result in a combined company with significantly greater financial,
technological, and human resources to develop new products and acquire
new technologies.
The ISS report also noted that the fairness opinion rendered by First
Analysis Corporation indicated that the transaction was fair to the Cylink
shareholders from a financial point of view, and added that the offer price
represents a 115 percent premium based on Cylink's average closing price
for the five-day period beginning 60 days prior to the announcement.
--more--
ISS Recommends Cylink Shareholders Approve
1/28/03--page 2
The ISS analysis also pointed out that the merger is intended to be tax-free to
the Cylink shareholders, who will end up owning approximately 17.4 percent of
SafeNet stock at the time the merger is completed. For these reasons, ISS has
advised the Cylink shareholders to vote in favor of item 1 on the proxy.
"We are pleased that ISS' careful analysis recognized both the strategic and
economic benefits of this combination," said William P. Crowell, Cylink's
president and chief executive officer. The special meeting of Cylink shareowners
to vote for the merger with SafeNet will be held on February 5. For more
information about how to vote for the merger proposal, shareholders should call
R. Christopher Chillingworth, Cylink's VP Finance and CFO at 408-855-6003.
Subject to shareholder approval and the satisfaction of other closing conditions
in the merger agreement, SafeNet and Cylink expect to close the transaction in
early February.
About Cylink
Cylink develops, markets, and supports a comprehensive portfolio of hardware and
software security products for mission-critical private networks and business
communications over the Internet. The company's solutions offer competitive
advantages by lowering the cost of deploying and managing secure, reliable
private networks, while enabling the use of the Internet for trusted
transactions with business partners and customers. Headquartered in Santa Clara,
California, Cylink has 165 employees worldwide working in six offices around the
world.
About SafeNet
SafeNet, Inc. (Nasdaq: SFNT) has set the industry standard for virtual private
network (VPN) technology and secure business communications. With more than 18
years experience in developing, deploying, and managing network security systems
for the most security-conscious financial institutions and government
organizations around the world, SafeNet's proven technology has emerged as the
de facto industry standard for VPNs. SafeNet created the first Internet VPN
system, which has evolved into the only encryption platform to meet every
security need in every product category. SafeNet security solutions, based on
SecureIP Technology(TM), and part of the CGX Security Platform, have become the
products of choice for leading Internet infrastructure manufacturers, service
providers, and security vendors. With SafeNet securing the infrastructure of
today's e-business communications as well as leading the way in government
Homeland and classified data security, the company has opened new markets for
interoperable, secure, and deployable VPN communications. Commercial customers
include Texas Instruments, Microsoft, Samsung, Centillium Communications, ARM,
and Cisco Systems. Government customers include U.S. Department of Defense, U.S.
Internal Revenue Service, and the Social Security Administration. For more
information, visit http://www.SafeNet-inc.com/.
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ISS Recommends Cylink Shareholders Approve
1/28/03--page 3
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995
The statements contained in this release, which are not historical facts, are
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Examples of
such forward looking statements include statements regarding the premium to be
realized by Cylink shareholders in the merger, the expected synergies between
Cylink and SafeNet and the ability of the combined company to develop new
products and technologies, the tax treatment of the merger, and the expected
period for closing the transaction. These statements are subject to
uncertainties that could cause actual results to differ materially
from those set forth in or implied by forward-looking statements. These risks
and uncertainties include the volatility of both SafeNet's and Cylink's common
stock and the market value of SafeNet's common stock at the effective time of
the merger, the failure of either SafeNet's or Cylink's shareholders to approve
the merger by the required vote, the failure of Cylink or SafeNet to satisfy
certain closing conditions in the merger agreement, the risk that SafeNet and
Cylink may not combine the two companies, their products and technologies
effectively or at all, and the other risks described in Cylink's and SafeNet's
Securities and Exchange Commission filings.
Additional Information and Where to Find It
Prior to this communication, SafeNet has filed a Registration Statement on Form
S-4 with the SEC (the "Registration Statement") in connection with the proposed
merger of Cylink with a subsidiary of SafeNet, Inc. (the "Merger"), pursuant to
the merger agreement (the "Merger Agreement") between SafeNet and Cylink. The
Registration Statement includes a proxy statement of Cylink with respect to its
shareholders' vote on the proposed Merger, a proxy statement of SafeNet, Inc.
with respect to its shareholders' vote on the proposed Merger and a prospectus
of SafeNet with respect to the SafeNet shares to be issued to Cylink's
shareholders in the proposed merger (the "Proxy Statement/Prospectus"). Cylink
Corporation and SafeNet, Inc. mailed the Proxy Statement/Prospectus to their
respective shareholders on December 31, 2002. Investors and security holders are
urged to read the Registration Statement and the Proxy Statement/Prospectus
carefully. The Registration Statement and the Proxy Statement/Prospectus contain
important information about Cylink, SafeNet, the Merger, the Merger Agreement,
the persons soliciting proxies relating to the Merger, their interests in the
Merger, and related matters. Investors and security holders may obtain free
copies of these documents through the Web site maintained by the SEC at
http://www.sec.gov. In addition to the Registration Statement and the Proxy
Statement/Prospectus, Cylink and SafeNet file annual, quarterly and special
reports, proxy statements and other information with the SEC. You may read and
copy any reports, statements, or other information filed by Cylink or SafeNet at
the SEC public reference rooms at 450 Fifth Street, N.W., Washington, D.C. 20549
or at any of the SEC's other public reference rooms in New York, N.Y., and
Chicago, Ill. Please call the SEC at 1-800-SEC-0330 for further information on
the public reference rooms. Cylink's and SafeNet's filings with the SEC are also
available to the public from commercial document-retrieval services and at the
Web site maintained by the SEC at http://www.sec.gov.
--more--
ISS Recommends Cylink Shareholders Approve
1/28/03--page 4
Participants in Solicitation
Cylink, its directors, executive officers and certain other members of
management and employees and Mackenzie Partners are currently soliciting proxies
from Cylink shareholders in favor of the approval of the Merger and related
matters. SafeNet, its directors, executive officers and certain other members of
management and employees are currently soliciting proxies from SafeNet
shareholders in favor of the approval of the Merger and related matters.
Information concerning the participants in these solicitations is set forth in
the Registration Statement and the Proxy Statement/ Prospectus and investors are
urged to read such Registration Statement and the Proxy Statement/Prospectus.
# # #
Filed Under Rule 425
by Cylink Corporation
Sec File No. 0-27742
(Posted on Cylink Corporation
website-www.cylink.com)
Reminder Mailing
Two easy ways to vote
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Vote by Telephone
It's fast, convenient and your vote is immediately confirmed and posted.
Using a touch-tone telephone call the toll-free number located in the gray
shaded box on the upper left side of your Voting Instruction Form.
Follow the 4 easy steps:
1. Read the accompanying Proxy Statement and Voting Instruction Form.
2. Call the toll-free phone number.
3. Enter your 12-digit control number located in the gray shaded box on the
right side of your Voting Instruction Form.
4. Follow the simple instructions.
Make Your Vote Count!
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Vote by Internet
It's fast, convenient and your vote is immediately confirmed and posted. You
will also have the option to register to receive future materials via the
Internet, when available.
WWW.PROXYVOTE.COM
Follow the 4 easy steps:
1. Read the accompanying Proxy Statement and Voting Instruction Form.
2. Go to website www.proxyvote.com.
3. Enter your 12-digit control number located in the gray shaded box on the
right side of your Voting Instruction Form.
4. Follow the simple instructions.
Make Your Vote Count!
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And Remember...
Your vote by telephone or Internet will help your company save money!!!
Do not return your Voting Form if you voted by Telephone or Internet.