CONTACT:
Jeanne Harper Condren
(408) 944-1817
jeanne_condren@dmcwave.com
DIGITAL MICROWAVE CORPORATION STOCKHOLDERS APPROVE MERGER
SAN JOSE, CALIF. -- OCTOBER 7, 1998 -- Digital Microwave Corporation
(Nasdaq:DMIC) announced that at its special meeting today, stockholders approved
the merger with Innova Corporation (Nasdaq:INVA) such that Innova Corporation
will become a wholly owned subsidiary of Digital Microwave. The shareholders of
Innova Corporation also approved the transaction at a special meeting held
today. The transaction is expected to close this week.
Under the terms of the merger agreement, 1.05 shares of DMC common stock
will be issued for each share of common stock of Innova Corporation outstanding
at the time of the close of the transaction. The merger is intended to qualify
as a tax-free reorganization and a pooling-of-interests for accounting and
financial reporting purposes.
Headquartered in San Jose, California, Digital Microwave Corporation
designs, manufactures, and markets advanced wireless solutions for worldwide
telephone network interconnection and access. Transmitting and receiving
multiple digital lines, Digital Microwave's high-performance systems carry
voice, data, and digitized video signals across a full spectrum of frequencies
and capacities.
FOR MORE INFORMATION, VISIT: http://www.dmcwave.com
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CONTACT:
Jeanne Harper Condren
(408) 944-1817
jeanne_condren@dmcwave.com
DIGITAL MICROWAVE CORPORATION ANNOUNCES
COMPLETION OF INNOVA CORPORATION MERGER
AND COMPANY REORGANIZATION
SAN JOSE, CALIF.--OCTOBER 8, 1998--Digital Microwave Corporation (Nasdaq:DMIC)
today announced the completion of its merger with Innova Corporation
(Nasdaq:INVA). Innova is now a wholly owned subsidiary of Digital Microwave
Corporation. Stockholders of both companies approved the transaction at special
meetings yesterday.
Under the terms of the merger agreement, 1.05 shares of DMC common stock
will be issued for each share of common stock of Innova Corporation outstanding
at the time of the close of the transaction. The merger is intended to qualify
as a tax-free reorganization and a pooling-of-interests for accounting and
financial reporting purposes.
In addition, Digital Microwave Corporation announced today the
reorganization of its operations into three divisions. The Narrowband Division,
which will be responsible for the SPECTRUM-TM- II, XP-4, XP-2 and other related
medium-capacity products, will be headquartered in Seattle under the direction
of Frank Grenon, former President and Chief Executive Officer of Innova
Corporation. The Broadband Division, based in San Jose, has responsibility for
the new Altium-TM- high-capacity product line, and is headed by Sam Smookler.
MAS Technology Limited, a wholly owned subsidiary of the Company located in New
Zealand, under the management of Sam Wyman, becomes the Long Haul Division, and
is responsible for the DXR-TM- low-frequency, low-capacity product line. The
combined products of the Company will be sold through an integrated, worldwide
direct sales force, OEM channels and other indirect sellers.
In conjunction with the reorganization, Digital Microwave announced that
it is implementing approximately a 20% reduction in its worldwide work force. A
portion of this reduction will be immediate, with the remainder to be phased
over the next three to four months. The Company also intends to consolidate
facilities to reduce its fixed costs. The Company will generally be providing
two months' salary continuation packages for employees impacted by this
reduction. Digital Microwave currently employs approximately 1,060 worldwide,
including the former Innova Corporation employees.
As was announced previously, the Company reduced the worldwide work
force by 15% earlier in the year. Salary increases for senior Corporate
Officers were also
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deferred earlier this year. In addition, senior Corporate Officer salaries
will now be reduced 10% at this time.
As discussed in the September 8, 1998 S-4 Registration Statement filed
with the SEC, the Company anticipates acquisition, merger-related restructuring
costs and inventory write-downs, to total approximately $30-$40 million, which
will be taken as a one-time charge in the Company's third quarter ending
December 31, 1998. As a result of these restructuring and other cost-cutting
measures, the Company expects to realize cost savings of $5-6 million per
quarter going forward.
"Due to dramatic changes in world markets, we have concluded that
significant changes are required at Digital Microwave Corporation. We believe
that while this economic situation provides many challenges, there are also
opportunities," said Digital Microwave Corporation Chairman and CEO Charles
Kissner. "These changes in our markets in light of the current direction of the
world's economies demanded our proactive and immediate response. This new
structure allows us to concentrate into logical areas of technological expertise
with a focus on development and manufacturing efficiencies. This will benefit
our customers with a full range of highly competitive and advanced wireless
solutions for both voice and data telecommunications requirements. Digital
Microwave Corporation is thus better aligned to meet our customers' needs,
capitalize on our core competencies and take advantage of long-term
opportunities within the marketplace."
The statements in this press release that relate to future events or the
Company's future performance, including statements regarding future cost savings
are forward-looking. These forward-looking statements are based on current
expectations and the Company assumes no obligation to update this information.
The Company's actual results could differ materially from those anticipated in
these forward-looking statements as a result of certain factors, including the
volume and timing of orders for the Company's products, the ability of the
Company and its suppliers to respond to changes made by customers in their
orders, the timing of new product introductions, competition in the microwave
and access business, fluctuations in foreign currency exchange rates, the
economic conditions in the Asia/Pacific region, regulatory developments and
general economic conditions. For a more detailed discussion of such factors,
see the "Risk Factors" in the Company's Registration Statement on Form S-4 filed
with the SEC on September 1, 1998.
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Headquartered in San Jose, California, Digital Microwave Corporation
designs, manufactures, and markets advanced wireless solutions for worldwide
telephone network interconnection and access. Transmitting and receiving
multiple digital lines, Digital Microwave's high-performance systems carry
voice, data, and digitized video signals across a full spectrum of frequencies
and capacities.
FOR MORE INFORMATION, VISIT: http://www.dmcwave.com
SPECTRUM, ALTIUM AND DXR ARE TRADEMARKS OF DIGITAL MICROWAVE CORPORATION.
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Jeanne Harper Condren
(408) 944-1817
jeanne_condren@dmcwave.com
DIGITAL MICROWAVE CORPORATION APPOINTS PAUL S. BACHOW AND
V. FRANK MENDOCINO TO BOARD OF DIRECTORS
SAN JOSE, CALIF.--OCTOBER 8, 1998--Digital Microwave Corporation (Nasdaq:DMIC)
today announced that it has appointed Paul S. Bachow, 47, and V. Frank
Mendocino, 59, to its Board of Directors.
In a related story, Digital Microwave Corporation today announced the
completion of its merger with Innova Corporation, a designer and manufacturer of
millimeter wave radios for use as low- to medium-capacity wireless
communications links.
Paul Bachow has served as a Director of Innova Corporation since January
1993. Mr. Bachow is President of Bachow & Associates, Inc., a venture capital
investment company, and the General Partner of Paul S. Bachow Co-Investment
Fund, L.P. and Bachow Investment Partners III, L.P. Mr. Bachow serves as a
director of Deb Shops, Inc., a publicly traded company in the women's clothing
business; Anadigics, Inc., a publicly traded manufacturer of gallium arsenide
chips for use in a broad array of communications devices; Crusader Holding
Corporation, a publicly traded savings and loan; and several private companies.
Frank Mendicino has served as a Director of Innova Corporation since
July 1989 and as Innova's Chairman since February 1992. As of 1983,
Mr. Mendicino has acted as a General Partner of Woodside Fund, Woodside Fund II
and Woodside Fund III, private investment funds. He has also served as a
director of over 15 private companies.
"We are extremely pleased to welcome Paul and Frank, two businessmen who
are very knowledgeable about the telecommunications sector, to Digital
Microwave's Board of Directors," stated Chuck Kissner, Chairman and Chief
Executive Officer of Digital Microwave Corporation. "We believe their wealth of
experience will be especially valuable to the Company as we integrate our
business with Innova's and continue to expand into new markets in the U.S. and
abroad."
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Headquartered in San Jose, California, Digital Microwave Corporation
designs, manufactures, and markets advanced wireless solutions for worldwide
telephone network interconnection and access. Transmitting and receiving
multiple digital lines, Digital Microwave's high-performance systems carry
voice, data, and digitized video signals across a full spectrum of frequencies
and capacities.
FOR MORE INFORMATION: www.dmcwave.com
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