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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
October 6, 1998 (September 30, 1998)
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Date of Report (Date of Earliest Event Reported)
WAVETEK WANDEL & GOLTERMANN, INC.
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(Exact Name of Registrant As Specified In Its Charter)
DELAWARE
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(State or Other Jurisdiction of Incorporation or Organization)
333-32195 33-0457664
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(Commission File Number) (IRS Employer Identification No.)
11995 El Camino Real, Suite 301
San Diego, California 92130
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(Address of Principal Executive Offices)(Zip Code)
(619) 793-2300
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(Registrant's Telephone Number, including Area Code)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On September 30, 1998, Wavetek Wandel & Goltermann, Inc. (the "Registrant")
and Wandel & Goltermann Management Holding GmbH, a German limited liability
company ("WG"), consummated a transaction whereby the stockholders of WG
contributed their capital interests to the Registrant in exchange for cash and
shares of the Registrant's common stock. As a result of the transaction, WG
became a wholly-owned subsidiary of the Registrant and the stockholders of WG
received DM2 million and 8,317,464 newly-issued shares of the Registrant's
common stock, which constitute 63% of the outstanding shares.
At the effective time of such exchange, the Registrant filed a Restated
Certificate of Incorporation which, among other things, changed the name of the
Registrant from Wavetek Corporation to Wavetek Wandel & Goltermann, Inc. In
addition, the Registrant amended its bylaws.
The type and amount of consideration received by the WG stockholders was
determined by arms-length negotiation between the parties, and the cash
consideration was paid from general corporate funds. Prior to entering into the
exchange transaction, there were no material relationships between the
Registrant and WG or between any of their affiliates, directors, officers or
associates of any such director or officer.
The Registrant intends to continue to use the physical plant, property and
equipment of WG for housing administrative offices, manufacturing and
distribution in the same manner that was previously used by WG.
ITEM 4. CHANGES IN REGISTRANT'S INDEPENDENT ACCOUNTANT.
(a) On September 30, 1998, the Registrant and WG consummated a transaction
whereby WG became a wholly-owned subsidiary of the Registrant and the
stockholders of WG became stockholders of the Registrant. The Registrant has
historically engaged Ernst & Young LLP as its independent accountant and WG has
historically engaged Arthur Andersen LLP as its independent accountant.
Although WG became a subsidiary of the Registrant, the stockholders of WG
received 63% of the outstanding common stock of the Registrant and therefore,
for accounting purposes, WG is deemed to be the surviving company in the
transaction and its historical financial statements became the historical
financial statements of the consolidated company. Therefore, on October 2,
1998, the Board of Directors appointed Arthur Andersen LLP as the auditor for
the financial statements of the Registrant for the fiscal year ended September
30, 1998.
During the Registrant's past two fiscal years and the subsequent
interim periods preceding the change in accountants, (i) the reports of Ernst &
Young on the financial statements of the Registrant contained no adverse opinion
or disclaimer of opinion, and were not qualified or modified as to uncertainty,
audit scope or accounting principles, (ii) there have been no disagreements with
Ernst & Young LLP on any matter of accounting principles
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or practice, financial statement disclosure or auditing scope or procedure,
which disagreements if not resolved to the satisfaction of Ernst & Young LLP
would have caused them to make reference thereto in their reports on the
financial statements of the Registrant and (iii) there have been no
"reportable events" (as defined in Item 304(a)(1)(v) of Regulation S-K).
The Registrant has provided Ernst & Young LLP with a copy of the
disclosure it is making in this Item 4. Ernst & Young LLP has furnished the
Registrant with a letter addressed to the Securities and Exchange Commission
stating that it agrees with the above statements. A copy of such letter is
filed as Exhibit 16.1 to this report.
(b) During the Registrant's past two fiscal years and the subsequent
interim periods preceding the change in accountants, neither the Registrant nor
anyone on its behalf consulted Arthur Andersen on any issue.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Businesses Acquired.
The Registrant hereby undertakes to file the financial statements required
by this item no later than December 14, 1998.
(b) Pro Forma Financial Information.
The Registrant hereby undertakes to file the financial information required
by this item no later than December 14, 1998.
(c) Exhibits.
<TABLE>
<CAPTION>
Number Description
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<S> <C>
2.1 First Amendment, dated September 25, 1998, to the Exchange and Merger
Agreement and Stockholders Agreement.
3.1 Restated Certificate of Incorporation.
3.2 Amendment to the Bylaws, dated September 30, 1998.
16.1 Letter from Ernst & Young LLP.
</TABLE>
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunder duly authorized.
Dated: October 6, 1998
WAVETEK WANDEL & GOLTERMANN, INC.
By: /s/ Vickie L. Capps
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Name: Vickie L. Capps
Title: Chief Financial Officer
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FIRST AMENDMENT TO EXCHANGE AND MERGER AGREEMENT
AND STOCKHOLDERS AGREEMENT
First Amendment, dated as of September 25, 1998, to the Exchange and
Merger Agreement, dated as of June 12, 1998 (the "Exchange Agreement"), among
Wavetek Corporation ("Wavetek"), Wandel & Goltermann Management Holding GmbH
("WG") and the stockholders listed on the signature pages thereto (the
"Stockholders") and the Stockholders Agreement, dated as of June 12, 1998 and
effective as of the Effective Time (the "Stockholders Agreement"), among Wavetek
and the Stockholders.
WHEREAS, Wavetek, WG and the Stockholders have agreed to amend the Exchange
Agreement and the Stockholders Agreement to eliminate the formation of WG
Holding and the merger of WG Holding with Wavetek Corporation such that the
Exchange and the Merger constitute the same transaction and to make certain
other modifications to the provisions governing conditions to closing,
termination and closing date;
NOW, THEREFORE, the parties hereto agree as follows:
1. Section 1.1(a) of the Exchange Agreement shall be amended to read in
its entirety as follows:
(a) At or before the Effective Time, each WG Stockholder shall
transfer and assign to Wavetek (free and clear of all liabilities, liens,
claims, pledges, security interests, charges or encumbrances, restrictions,
title retention agreements, proxies or other voting arrangements, rights of
first refusal, tag along or similar rights of any nature whatsoever (all of
the foregoing collectively "Liens")) all the outstanding share capital of
WG ("WG Interests"), with the right to all dividends not distributed prior
to September 30, 1998, but without prejudice to Section 2.2(b), and at the
Effective Time, Wavetek shall deliver to the WG Stockholders the number of
shares of Wavetek Common Stock and the cash consideration set forth
opposite the name of such WG Stockholder on Annex 1 (the "Exchange"). The
aggregate number of shares of Wavetek Common Stock issued will be 8,317,464
and the aggregate cash consideration to be paid to the WG Stockholders will
be DM2 million.
The revised Annex 1 attached to this First Amendment shall replace Annex 1
to the Exchange Agreement.
2. Section 1.1(c) of the Exchange Agreement shall be amended to read in
its entirety as follows:
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(c) Although the Exchange and the Merger shall occur simultaneously,
all such transactions shall be unwound and deemed not to have occurred
unless all such transactions are consummated at or immediately prior to the
Effective Time.
3. Section 1.2 of the Exchange Agreement shall be amended to read in its
entirety as follows:
SECTION 1.2. PROCEDURES. At the Effective Time, the WG Stockholders,
on the one hand, and Wavetek, on the other hand, shall be parties to a
notarial deed of a German or Swiss notary pursuant to which all outstanding
WG Interests shall be transferred to Wavetek, such notarial deed to be
substantially in the form of Annex 2 hereto (the "Notarial Deed").
Simultaneously with the satisfaction of the condition precedent to the
transfer of the WG Interests to Wavetek pursuant to the Notarial Deed (see
Item 3 under the caption "Transfer of GmbH Shares" in the Notarial Deed),
Wavetek shall deliver to each holder of WG Interests the cash consideration
and a certificate or certificates representing the number of whole shares
of Wavetek Common Stock which such holder has the right to receive in
respect of the WG Interests pursuant to the provisions of Section 1.1 and
this Section 1.2. The WG Stockholders hereby authorize and direct Wavetek
(i) to deliver possession of Wavetek share certificates to be issued by
Wavetek to the WG Stockholders pursuant to Section 1.1 and this Section 1.2
to WG's U.S. counsel, Rogers & Hardin, and (ii) to pay the aggregate cash
consideration to be paid to the WG Stockholders pursuant to Section 1.1 and
this Section 1.2 by wire transfer to such accounts designated by WG's
German counsel, Norr, Stiefenhofer & Lutz.
The revised Annex 2 attached to this First Amendment shall replace Annex 2
to the Exchange Agreement.
4. Section 1.3 of the Exchange Agreement shall be amended to read in its
entirety as follows:
SECTION 1.3. AMENDMENT TO WG STOCKHOLDER LOANS. Immediately prior to
the Effective Time, the existing WG stockholder loans (set forth in
Annex 4) (the "WG Stockholder Loans") shall be increased and modified,
whereupon the aggregate principal amount of WG Stockholder Loans shall be
increased to an amount not less than DM14 million and not more than DM23
million, the exact amount to be mutually agreed upon by WG and the WG
Stockholders providing such loans prior to the Effective Time, and the
interest rate and repayment terms shall be modified in the manner set forth
on Annex 4-A attached hereto. Annex 4-A attached to this Agreement shall
be deemed incorporated in and attached to the Exchange Agreement.
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5. Section 1.4 of the Exchange Agreement shall be amended to read in its
entirety as follows:
SECTION 1.4. OPTION GRANTS. At the Effective Time, (i) Wavetek's
1992 Non-Qualified Employee Stock Option Plan, as amended, will be amended
to increase the number of shares of Common Stock available for option
grants thereunder from 663,160 shares to 1,320,232 and (ii) Wavetek shall
reserve up to 558,055 options at the Effective Time for granting to WG
employees, directors and new hires, of which 97,161 options shall be fully
vested upon their grant; provided that such vested options shall not
constitute more than 50% of the options held by any grantee and shall
represent acceleration of the earliest vesting dates; provided, however,
that the recipients of such options shall be determined by the Compensation
Committee (as defined in the Stockholders Agreement). The exercise price
for such options shall be the fair market value of the shares of the
Company at the Effective Time as determined pursuant to Section 1.6 hereof.
6. A new Section 1.6 shall be added to the Exchange Agreement to read as
follows:
SECTION 1.6. VALUATION OF WAVETEK. Promptly following the
Effective Time, a valuation of Wavetek shall be performed for purchase
accounting purposes and in order to establish the fair market value of the
Company at the Effective Time for purposes of pricing the options granted
pursuant to Section 1.4 hereof. To the extent that such firms are
available to perform such evaluation without impairing their independence
as auditors of Wavetek and WG and upon terms acceptable to the Executive
Committee (as defined in the Stockholders Agreement), then the public
accounting firm of Ernst & Young shall perform such valuation, such
valuation to be reviewed and approved by the public accounting firm of
Arthur Andersen. Otherwise, such valuation shall be performed by an
independent appraiser or evaluation expert selected by the Executive
Committee.
7. Section 2.2(b) of the Exchange Agreement shall be amended to read in
its entirety as follows:
(b) make, declare or pay any dividend or make any other distribution
on, or directly or indirectly redeem, purchase or otherwise acquire, any
shares of its capital stock or any securities or obligations convertible
into or exchangeable for any shares of its capital stock, or grant any
stock appreciation rights, options or any right to acquire any shares of
its capital stock, except for dividends paid by any wholly owned subsidiary
to WG or Wavetek, as applicable, or any of its
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wholly owned subsidiaries; provided, however, that (i) WG may pay a
dividend to its stockholders in an amount not to exceed DM3 million;
(ii) WG may make a payment of DM205,000 to HF and a payment of
DM246,000 to Frank Goltermann in consideration of their agreement to
amend their respective WG Stockholder Loans to WG in accordance with
Section 1.3 hereof; (iii) WG may pay to or for the benefit of Albrecht
Wandel DM1,124,080 in consideration of the prepayment of a pension/life
insurance obligation of WG to Albrecht Wandel; and (iv) Wavetek may
purchase shares of its capital stock and options from its employees who
terminate employment with Wavetek in a manner consistent with past
practice;
8. Section 2.2 of the Exchange Agreement shall be amended by the addition
of the following new subsection (k):
(k) Notwithstanding anything in this Section 2.2 to contrary: (i) to
the extent that Wavetek, WG or their respective subsidiaries are expressly
permitted to take any action pursuant to any subparagraph of this
Section 2.2, such action shall not be deemed prohibited by any other
subparagraph of this Section 2.2, (ii) WG and its subsidiaries shall be
permitted to effect the dividend of all of the outstanding ownership
interests in Wandel & Goltermann A.T.E. Systems, Inc. from the WG
subsidiary or subsidiaries holding such entity up to WG and (iii) WG and
its subsidiaries shall be entitled to enter into a sale/leaseback
transaction pursuant to which certain property held by WG and/or its
subsidiaries may be purchased by Albrecht Wandel or his affiliates and
leased back to WG and/or its subsidiaries, such sale/leaseback arrangements
to be on such terms as may be approved on behalf of the Company by Peter
Wagner and Dr. Terrence J. Gooding.
9. Section 2.3(a) of the Exchange Agreement shall be amended to read in
its entirety as follows:
(a) sell, transfer, mortgage, encumber or otherwise dispose of any WG
Interests owned or held by it other than (i) in connection with the Merger
or the Exchange, (ii) to any executive officer of WG or any other WG
Stockholder or (iii) in a Permitted Transfer (as defined in the
Stockholders Agreement, assuming the Stockholders Agreement were binding at
the time of such transfer), provided that such transferee becomes a party
to and agrees to be bound by each of this Agreement and the Stockholders
Agreement as a condition to such transfer, or take any action that would
adjust, split, combine or reclassify any capital stock of WG or issue any
additional shares of capital stock of WG except as contemplated by Section
4.9 hereof;
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10. The phrase "at or immediately" in the first sentence of Section 2.5(a)
of the Exchange Agreement shall be replaced with the phrase "as promptly as
practicable".
11. A new Section 2.5(c) shall be added to the Exchange Agreement to read
as follows:
(c) In the event that an Initial Public Offering is not consummated
by March 31, 1999, the Company agrees to use its reasonable best efforts to
effectuate a transaction to provide liquidity for its stockholders.
12. The following sentence shall be added to the end of Section 4.9 of the
Exchange Agreement:
WG shall be entitled to make a cash payment not to exceed DM 1.5
million to acquire such capital stock.
13. Section 4.10 of the Exchange Agreement shall be deleted in its
entirety.
14. Section 5.1(f) of the Exchange Agreement shall be deleted in its
entirety.
15. Section 7.1 of the Exchange Agreement shall be amended to read in its
entirety as follows:
SECTION 7.1. EFFECTIVE DATE AND EFFECTIVE TIME. On September 30,
1998, a closing of the Exchange, the Merger and the transactions
contemplated hereby shall be held at the offices of Sullivan & Cromwell,
1888 Century Park East, Los Angeles, California 90067 at 7:00 a.m., Los
Angeles time, or such other times and locations as may be agreed by Wavetek
and WG, whereupon the deliveries and proceedings contemplated hereby,
including, without limitation, those matters described in Article I hereof,
shall be effected. The date of such closing is herein called the
"Effective Date". The Merger and Exchange shall become effective upon the
satisfaction of the condition precedent to the transfer of the WG Interests
to Wavetek pursuant to the Notarial Deed (see Item 3 under the caption
"Transfer of GmbH Shares" in the Notarial Deed) (the "Effective Time").
16. Section 2.1(h) of the Stockholders Agreement shall be amended to read
in its entirety as follows:
(h) At the Effective Time, Terence J. Gooding and Albrecht Wandel
will be Co-Chairmen of the Board (with the roles and responsibilities set
forth on Annex 1) and the Chief Executive Officer shall be Peter Wagner
(with the roles and responsibilities set forth on Annex 2). The term
"Chairman of the Board"
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used in this Agreement shall refer to (i) each of the Co-Chairmen of the
Board if two individuals serve in such capacity and (ii) the Chairman of
Board if only one individual serves in such capacity. The Company shall
employ Peter Wagner as Chief Executive Officer pursuant to an employment
agreement agreed to between the Company and such individual prior to the
Effective Time. Terence J. Gooding shall not be an executive officer of
the Company and shall no longer serve as Co-Chairman of the Board
following the earlier of (i) six months following the consummation of the
Initial Public Offering and (ii) September 30, 1999.
17. Two new sentences will be added to the end of Section 2.5 of the
Stockholders Agreement as follows:
Notwithstanding the foregoing, if the Stockholders other than Gooding,
the DLJ Investors, GEI and any other "Principals" and their "Related
Parties" (such terms as defined in the Indenture, dated as of June 11,
1997, among the Company, Wavetek U.S. Inc. and The Bank of New York) (such
Stockholders, including for this purpose any other person that with such
Stockholders may constitute a "person" as such term is used in Section
13(d)(3) of the Exchange Act, the "Limited Holders") hold in excess of
49.9% of the outstanding shares of the Common Stock of the Company at any
particular time, then at such time this Section 2.5 (i) shall be operative
as to all shares of Common Stock held by any Stockholder that is not a
Limited Holder and (ii) shall relate only to a fraction of the shares of
the Common Stock then held by any such Limited Holder, the numerator of
such fraction being the product of .499 times the total number of shares of
Common Stock of the Company outstanding at such time and the denominator of
such fraction being the total number of shares of Common Stock then held by
all Limited Holders. For example, as of the Effective Time, this Section
2.5 shall relate only to 2,314,334*((.499*13,202,324) DIVIDED BY
(9,247,074)) = 1,648,818 of the shares held by Albrecht and Renate Wandel.
18. The following sentence shall be added to the beginning of Section 3.1
of the Stockholders Agreement.
Prior to the consummation of an Initial Public Offering, no Stockholder may
Transfer its Shares to any Person unless as a condition of Transfer, such
Person, prior or concurrently with such Transfer, undertakes by a written
agreement in substantially the form of Annex 3, to be bound by the terms of
this Agreement to the same extent and in the same manner as the
Transferring Stockholder.
19. Section 3.3 of the Stockholders Agreement shall be amended by
inserting "(other than those set forth in Section 3.1)" after "Transfer of
Shares" the first time it
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appears and Section 3.4 of the Stockholders Agreement shall be amended by
inserting "(other than those set forth in Section 3.1)" after "Transfer of
Shares".
20. New Section 4.1(d) shall be added to the Stockholders Agreement to
read as follows:
(d) Notwithstanding the foregoing provisions of this Section 4.1, no
Stockholder (including for this purpose any other person that may
constitute a "person" as such term is used in Section 13(d)(3) of the
Exchange Act) may acquire more than 49.9% of the outstanding Shares
pursuant to the Right of First Offer.
21. The first sentence of Section 4.3 of the Stockholders Agreement shall
be amended to read as follows:
Prior to and after the Initial Public Offering, subject to Section 4.1, if
the Stockholders collectively own more than 40% of the issued and
outstanding Shares and if Stockholders owning or holding beneficial
ownership of at least 75% of all issued and outstanding Shares held by
Stockholders (the "PROPOSING STOCKHOLDERS") elect to sell all of such
Stockholders' Shares to any Person not a party to this Agreement for
consideration consisting solely of cash or cash equivalent, such Proposing
Stockholders shall have the right to require the Transfer of all other
Stockholders' Shares to such Person at the same price and on the same terms
and conditions as such Proposing Stockholders (the "Bring-Along Right").
22. New Sections 4.4 and 4.5 shall be added to the Stockholders Agreement
to read as follows:
4.4 CERTAIN PREEMPTIVE RIGHTS. If, prior to an Initial Public
Offering, the Company proposes to issue, sell, or grant Common Stock or
Rights, then the Company shall, no later than 30 days prior to the
consummation of such issuance, give written notice to all Stockholders of
such proposed issuance. Such notice shall describe the proposed issuance
and contain an offer to each of the Stockholders to sell to such
Stockholder, at the same price and on the same terms and conditions as
offered to the proposed purchasers, such Stockholder's pro rata portion
(which shall be a percentage equal to the percentage of the outstanding
Common Stock held by such Stockholder before such proposed issuance;
PROVIDED, HOWEVER, that if the use of proceeds of such transaction shall
include the repurchase of Common Stock, then such percentage shall be
calculated assuming the consummation of such repurchase) of the Common
Stock or Rights to be sold. If any Wavetek Stockholder fails to accept
such offer, by written notice within 25
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days after its receipt of the Company's notice (a "DECLINING WAVETEK
STOCKHOLDER"), the Company shall offer to sell to each other Wavetek
Stockholder that has accepted such offer (an "ACCEPTING WAVETEK
STOCKHOLDER") such Accepting Wavetek Stockholders' pro rata portion (which
shall be a percentage equal to the number of shares of outstanding Common
Stock held by such Accepting Wavetek Stockholder divided by the number of
shares of outstanding Common Stock held by all Accepting Wavetek
Stockholders desiring to acquire a portion of the Common Stock offered to
the Declining Wavetek Stockholder; such proration shall be made so that
Accepting Wavetek Stockholders shall have the right to acquire up to 100%
of the shares allocated to the Declining Wavetek Stockholder) of the
Common Stock offered to the Declining Wavetek Stock- holder. If any
WG Stockholder fails to accept such offer by written notice within 25 days
after its receipt of the Company's notice (a "DECLINING WG STOCKHOLDER"),
the Company shall offer to sell to each other WG Stockholder that has
accepted such offer (an "ACCEPTING WG STOCKHOLDER") such Accepting
WG Stockholders' pro rata portion (which shall be a percentage equal to
the number of shares of outstanding Common Stock held by such Accepting
WG Stockholder divided by the number of shares of outstanding Common Stock
held by all Accepting WG Stockholders desiring to acquire a portion of the
Common Stock offered to the Declining WG Stockholder; such proration shall
be made so that Accepting WG Stockholders shall have the right to acquire
up to 100% of the shares allocated to the Declining WG Stockholder) of
the Common Stock offered to the Declining WG Stockholder. If any
Stockholder fails to accept such offer by written notice within 25 days
after its receipt of the Company's notice, or any Accepting Wavetek
Stockholder or Accepting WG Stockholder fails to accept such offer of
Common Stock offered to a Declining Wavetek Stockholder or a Declining
WG Stockholder, respectively, by written notice within 2 business days
after its receipt of the Company's notice with respect thereto, the
Company may proceed with such proposed issuance, free of any right on the
part of such Stockholder or any Declining Wavetek Stockholder or Declining
WG Stockholder under this Section 4.4 in respect thereof. This Section 4.4
shall not apply to issuances of Common Stock or Rights (i) to employees
pursuant to employee stock option plans, stock purchase plan or similar
benefit program or agreement, where the primary purpose is not to raise
additional equity capital for the Company or (ii) as consideration for the
acquisition by the Company of another business or the merger of any
business entity with and into the Company or any wholly owned subsidiary of
the Company.
4.5 LIQUIDITY. In the event that an Initial Public Offering is not
consummated by March 31, 1999, the Company agrees to use its reasonable
best efforts to effectuate a transaction to provide liquidity for its
stockholders.
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23. Section 5.1(a) of the Stockholders Agreement shall be renumbered as
Section 5.1(b) and shall be amended by inserting the following phrase at
beginning: "Subsequent to an Initial Public Offering,"; Section 5.1(b) shall be
renumbered as Section 5.1(c); Section 5.1(c) shall be renumbered as Section
5.1(d); Section 5.1(d) shall be renumbered as Section 5.1(e); and the following
shall be inserted as Section 5.1(a):
(a) If an Initial Public Offering is not consummated within
24 months of the Effective Time, the Stockholders shall have a right
("Pre-Offering Registration Right") to require the Company, as
expeditiously as possible, to use its best efforts to effect the
registration of the Shares that such Stockholders shall request, pursuant
to a Registration Statement, subject to the following limitations:
(i) such Pre-Offering Registration Right shall be
exercisable, on one occasion, by written notice given to the Company
and to all other Stockholders by one or more Stockholders owning or
holding of record greater than 15% of the issued and outstanding
shares of Common Stock (the "Section 5.1(a) Notice");
(ii) during the fifteen (15) day period following the
giving of the Section 5.1(a) Notice, all Stockholders shall have the
right to elect to participate in the Pre-Offering Registration Right
by giving notice to the Company of their respective election;
(iii) the shares to be registered by all Stockholders
electing to register Shares pursuant to this Section 5.1(a) shall have
an aggregate offering price of at least $10 million; and
(iv) such Pre-Offering Registration Right shall terminate
upon the consummation of an Initial Public Offering consummated after
such 24 month period.
24. Section 5.1(e) of the Stockholders Agreement shall be renumbered as
Section 5.1(f) and shall be amended to read in its entirety as follows:
(f) PRIORITY IN REGISTRATIONS ON REQUEST. If a registration
pursuant to this Section 5.1 involves an underwritten offering and the
managing underwriter with respect to such offering advises the Stockholders
participating in such registration in writing that, in its opinion, the
number of Shares which the Stockholders and any other persons intended to
be included in such registration exceeds the largest number of Shares which
can be sold in such offering without having an adverse effect on the
offering of Shares as contemplated by such Stockholders, then the Company
will include in such registration (i) first, in the
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case of the Initial Public Offering only, such Shares requested by HF, if
any, to enable it to reduce its ownership of shares in the Company
immediately following consummation of the Initial Public Offering to not
less than 10% of the outstanding shares (provided that any shares thereby
allocated to HF will reduce the shares available to other WG Stockholders
pursuant to clause (iv)), (ii) second, in the case of any registration
following the Initial Public Offering in which HF shall be entitled to
register Shares pursuant to Section 5.1 or 5.2 hereof, such shares
requested by HF, if any, (iii) third, all the shares the Company proposes
to sell for its own account and (iv) fourth, the Shares which the
Stockholders (excluding HF in the event clause (i) or (ii) shall be
applicable with respect to such registration) have requested to be included
in such registration pursuant to Section 5.1 and which, in the opinion of
such managing underwriter, can be sold without having the adverse effect
referred to above, such reduced number of Shares shall be allocated
pro rata among all requesting Stockholders on the basis of the relative
number of Shares then owned or held of record by each such Stockholder
(provided that (A) any shares thereby allocated to any Wavetek Stockholder
that exceed such Wavetek Stockholder's request will be first reallocated
among the remaining requesting Wavetek Stockholders in like manner and
(B) any shares thereby allocated to any WG Stockholder that exceed such
WG Stockholders' request will first be reallocated among the remaining
requesting WG Stockholders in like manner).
25. Section 6.4(a) of the Stockholders Agreement shall be amended by
inserting the following text at the end:
At the time of the Initial Public Offering, this Agreement shall be amended
(i) to eliminate provisions that are expressly operative only prior to the
Initial Public Offering and (ii) as is otherwise then deemed appropriate by
the Stockholders.
26. The WG Stockholders represent that, except to the extent contained in
the Exchange Agreement or the Stockholders Agreement or contracts, arrangements
or understandings among the Wandel Stockholders or among the Goltermann
Stockholders, there is no contract, arrangement or understanding with any of the
WG Stockholders whereby they have agreed to act as a partnership, limited
partnership, syndicate or group for the purpose of acquiring, holding or
disposing of the shares of Wavetek Common Stock to be acquired pursuant to the
Exchange Agreement.
27. Each person executing this First Amendment who was not originally a
party to the Exchange Agreement or Stockholders Agreement agrees, effective upon
transfer of WG Interests to such person in accordance with the terms of the
Exchange Agreement, to be bound by the terms of the Exchange Agreement and
Stockholders Agreement, each as amended hereby, as if such person was a party to
such agreements.
-10-
<PAGE>
28. Except as expressly amended and modified hereby, the Exchange
Agreement and the Stockholders Agreement are reaffirmed and remain in full force
and effect. This First Amendment may be executed in several counterparts, each
of which shall be deemed an original and all of which together shall constitute
one and the same instrument.
-11-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
as of the date first written above.
WAVETEK CORPORATION
By: /s/ Terence J. Gooding
-----------------------------------------
Name: Terence J. Gooding
Title: Chairman and CEO
DLJ MERCHANT BANKING PARTNERS II, L.P.
By: DLJ Merchant Banking II, Inc.
Managing General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
DLJ MERCHANT BANKING PARTNERS II-A, L.P.
By: DLJ Merchant Banking II, Inc.
Managing General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
DLJ DIVERSIFIED PARTNERS, L.P.
By: DLJ Diversified Partners, Inc.
Managing General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
-11-A-
<PAGE>
DLJ DIVERSIFIED PARTNERS-A, L.P.
By: DLJ Diversified Partners, Inc.
Managing General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
DLJMB FUNDING II, INC.
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
DLJ FIRST ESC L.P.
By: DLJ LBO Plans Management Corporation
General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
DLJ EAB PARTNERS, L.P.
By: DLJ LBO Plans Management Corporation
General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
-11-B-
<PAGE>
DLJ MILLENNIUM PARTNERS, L.P.
By: DLJ Merchant Banking II, Inc.
Managing General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
DLJ MILLENNIUM PARTNERS-A, L.P.
By: DLJ Merchant Banking II, Inc.
Managing General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
DLJ OFFSHORE PARTNERS II, C.V.
By: DLJ Merchant Banking II, L.P.
Managing General Partner
By: /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
UK INVESTMENT PLAN 1997 PARTNERS
By: UK Investment Plan 1997 Partners, Inc.
General Partner
By /s/ Ivy Dodes
-----------------------------------------
Name: Ivy Dodes
Title: Vice President
-11-C-
<PAGE>
GREEN EQUITY INVESTORS II, L.P.
By: Grand Avenue Capital Partners, L.P.
Grand Avenue Capital Corporation,
its general partner
By: /s/ Peter Nolan
-----------------------------------------
Name: Peter Nolan
Title: Partner
SCHRODER UK VENTURE FUND III
By: Schroder Venture Managers Inc.,
as General Partner of
Schroder UK Venture Fund III LP1
By: /s/ Peter L. Everson
-----------------------------------------
Peter L. Everson, Director & VP
And: /s/ Nicola Lawson
-----------------------------------------
Nicola Lawson, Director & VP
SCHRODER UK VENTURE FUND III
By: Schroder Venture Managers Inc.,
as General Partner of
Schroder UK Venture Fund III LP2
By: /s/ Peter L. Everson
-----------------------------------------
Peter L. Everson, Director & VP
And: /s/ Nicola Lawson
-----------------------------------------
Nicola Lawson, Director & VP
-12-
<PAGE>
SCHRODER UK VENTURE FUND III
By: Schroder International Trust Company Limited,
as Trustee of Schroder UK Venture Fund III
Trust
By: /s/ Peter L. Everson
-----------------------------------------
Peter L. Everson, Director & VP
And: /s/ Nicola Lawson
-----------------------------------------
Nicola Lawson, Secretary
YOKOGAWA ELECTRIC CORPORATION
By: /s/ Joichi Ueba
-----------------------------------------
Name: Joichi Ueba
Title: Senior Vice President
DR. TERENCE J. GOODING
/s/ Terence J. Gooding
----------------------------------------------
Dr. Terence J. Gooding
BARBARA A. GOODING
TERENCE J. GOODING GRAT 1
TERENCE J. GOODING GRAT 2
BARBARA A. GOODING GRAT
By: /s/ Terence J. Gooding
-----------------------------------------
Terence J. Gooding, as
Attorney-in-Fact
-13-
<PAGE>
Wavetek Management Stockholders:
- --------------------------------
SNOW HILL TRUSTEES
RICHARD J. BERRY
PAUL STEVENSON
By: /s/ Terence J. Gooding
-----------------------------------------
Terence J. Gooding, as
Attorney-in-Fact
DEREK T. MORIKAWA
/s/ Derek T. Morikawa
-----------------------------------------
Derek T. Morikawa
MORIKAWA TRUST F/B/O MEGAN K. MORIKAWA
By: /s/ Criss Y. Morikawa
-----------------------------------------
Criss Y. Morikawa, as Trustee
MORIKAWA TRUST F/B/O EVAN T. MORIKAWA
By: /s/ Criss Y. Morikawa
-----------------------------------------
Criss Y. Morikawa, as Trustee
-14-
<PAGE>
BEN J. CONSTANTINI
/s/ Ben J. Constantini
----------------------------------------------
Ben J. Constantini
WG Stockholders:
- ----------------
WANDEL & GOLTERMANN MANAGEMENT
HOLDING GmbH
By: /s/ Karl-Heinz Eisemann
-----------------------------------------
Name: Karl-Heinz Eisemann
Title: Vice President, Controlling and
Logistics
And: /s/ Rolf Schmid
-----------------------------------------
Name:/s/ Rolf Schmid
Title: Chief Financial Officer
ALBRECHT WANDEL
/s/ Albrecht Wandel
----------------------------------------------
Albrecht Wandel
RENATE WANDEL
/s/ Renate Wandel
----------------------------------------------
Renate Wandel
-15-
<PAGE>
FRANK GOLTERMANN
/s/ Frank Goltermann
----------------------------------------------
Frank Goltermann
ULRIKE GOLTERMANN
By: /s/ Frank Goltermann
-----------------------------------------
Frank Goltermann, as Attorney-in-Fact
BURKHARD GOLTERMANN
/s/ Burkhard Goltermann
-----------------------------------------
Burkhard Goltermann
HANNOVER FINANZ W&G
BETEILIGUNGSGESELLSCHAFT mbH
By: /s/ Joachim Simmross
-----------------------------------------
Name: Joachim Simmross
Title: Managing Director
And: /s/ Claus von Loeper
----------------------------------------
Name: Claus von Loeper
Title: Managing Director
-16-
<PAGE>
New WG Stockholders:
- --------------------
PETER WAGNER
/s/ Peter Wagner
----------------------------------------------
Peter Wagner
ROBERTA AGOSTO GOLTERMANN
By: /s/ Frank Goltermann
------------------------------------------
Frank Goltermann, as Attorney-in-Fact
-17-
<PAGE>
RESTATED CERTIFICATE OF INCORPORATION
OF
WAVETEK CORPORATON
Wavetek Corporation, a Delaware corporation, hereby certifies as follows:
1. The name of the corporation is Wavetek Corporation. The date of
filing of its original certificate of incorporation with the Secretary of State
was January 28, 1991 and the name under which it was originally incorporated was
Torrey Investments, Inc.
2. This restated certificate of incorporation amends, restates and
integrates the provisions of the certificate of incorporation of said
corporation and has been duly adopted in accordance with the provisions of
Sections 242 and 245 of the General Corporation Law of the State of Delaware by
written consent of the holders of a majority of the outstanding stock entitled
to vote thereon in accordance with Section 228 of the General Corporation Law of
the State of Delaware, and written notice has been given to those stockholders
who have not consented in writing as provided in said Section 228.
3. The text of the certificate of incorporation is hereby amended and
restated to read herein as set forth in full:
FIRST. The name of this corporation is Wavetek Wandel & Goltermann,
Inc.
SECOND. The address of the corporation's registered office in the
State of Delaware is Corporation Trust Center, 1209 Orange Street in the
City of Wilmington, County of New Castle. The name of its registered agent
at such address is The Corporation Trust Company.
THIRD. The purpose of the corporation is to engage in any lawful act
or activity for which corporations may be organized under the General
Corporation Law of Delaware.
FOURTH. The total number of shares of all classes of stock which the
corporation shall have authority to issue is 55,000,000, of which
50,000,000 shares of the par value of $.01 per share shall be designated as
Common Stock and 5,000,000
<PAGE>
shares of the par value of $.01 per share shall be designated as Preferred
Stock. Shares of Preferred Stock may be issued in one or more series from
time to time by the board of directors, and the board of directors is
expressly authorized to fix by resolution or resolutions the designations
and the powers, preferences and rights, and the qualifications, limitations
and restrictions thereof, of the shares of each series of Preferred Stock,
including without limitation the following:
(a) the distinctive serial designation of such series which
shall distinguish it from other series;
(b) the number of shares included in such series;
(c) the dividend rate (or method of determining such rate)
payable to the holders of the shares of such series, any conditions
upon which such dividends shall be paid and the date or dates upon
which such dividends shall be payable;
(d) whether dividends on the shares of such series shall be
cumulative and, in the case of shares of any series having cumulative
dividend rights, the date or dates or method of determining the date
or dates from which dividends on the shares of such series shall be
cumulative;
(e) the amount or amounts which shall be payable out of the
assets of the corporation to the holders of the shares of such series
upon voluntary or involuntary liquidation, dissolution or winding up
the corporation, and the relative rights of priority, if any, of
payment of the shares of such series;
-2-
<PAGE>
(f) the price or prices at which, the period or periods within
which and the terms and conditions upon which the shares of such
series may be redeemed, in whole or in part, at the option of the
corporation or at the option of the holder or holders thereof or upon
the happening of a specified event or events;
(g) the obligation, if any, of the corporation to purchase or
redeem shares of such series pursuant to a sinking fund or otherwise
and the price or prices at which, the period or periods within which
and the terms and conditions upon which the shares of such series
shall be redeemed or purchased, in whole or in part, pursuant to such
obligation;
(h) whether or not the shares of such series shall be
convertible or exchangeable, at any time or times at the option of the
holder or holders thereof or at the option of the corporation or upon
the happening of a specified event or events, into shares of any other
class or classes or any other series of the same or any other class or
classes of stock of the corporation, and the price or prices or rate
or rates of exchange or conversion and any adjustments applicable
thereto; and
(i) whether or not the holders of the shares of such series
shall have voting rights, in addition to the voting rights provided by
law, and if so the terms of such voting rights.
-3-
<PAGE>
Subject to the rights of the holders of any series of Preferred Stock, the
number of authorized shares of any class or series of Preferred Stock may
be increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of the
outstanding shares of such class or series, voting together as a single
class, irrespective of the provisions of Section 242(b)(2) of the General
Corporation Law of Delaware or any corresponding provision hereafter
enacted.
FIFTH. The board of directors of the corporation is expressly
authorized to adopt, amend or repeal the by-laws of the corporation.
SIXTH. Elections of directors need not be by written ballot except
and to the extent provided in the by-laws of the corporation.
SEVENTH. A director of the corporation shall not be liable to the
corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except to the extent that such exemption from
liability or limitation thereof is not permitted under the Delaware General
Corporation Law as currently in effect or as the same may hereafter be
amended. No amendment, modification or repeal of this Article SEVENTH
shall adversely affect any right or protection of a director that exists at
the time of such amendment, modification or repeal.
EIGHTH. This Certificate of Incorporation may be amended only with
the approval of a two-thirds majority of each of the board of directors and
stockholders.
-4-
<PAGE>
IN WITNESS WHEREOF, Wavetek Corporation has caused this certificate to
be signed by Terence J. Gooding, its Chairman, as attested by Vickie L. Capps,
its Secretary, on this 29th day of September, 1998.
By: /s/ Terence J. Gooding
------------------------------------------
Terence J. Gooding
Attest:
By: /s/ Vickie L. Capps
-------------------------
Vickie L. Capps
-5-
<PAGE>
AMENDMENT NO. 1 TO THE BYLAWS
OF WAVETEK WANDEL & GOLTERMANN, INC.
(FORMERLY KNOWN AS TORREY INVESTMENTS, INC.)
Adopted by the Board of Directors on September 30, 1998
1. Section 1.7 of the Bylaws of the Company shall be amended by adding
the following to the end:
"Notwithstanding the foregoing, the following actions require the
approval of two-thirds of the stockholders: (i) any merger, consolidation,
liquidation or sale of all or substantially all of the assets of the
Corporation and (ii) any action to amend or repeal any provisions of the
certificate of incorporation or by-laws of the Corporation."
2. Section 2.6 of the Bylaws of the Company shall be amended to read in
its entirety the following:
Section 2.6 QUORUM; VOTE REQUIRED FOR ACTION. At all meetings of the
Board of Directors, six members of the entire Board shall constitute a
quorum for the transaction of business. In case at any meeting of the
Board a quorum shall not be present, the members of the Board present may
adjourn the meeting from time to time until a quorum shall be present. The
vote of a majority of the directors present at a meeting at which a quorum
is present shall be the act of the Board unless the certificate of
incorporation, these by-laws, a shareholders agreement with the Corporation
or a board approval policy approved by the Board shall require a vote of a
greater number.
3. Section 6.7 of the Bylaws of the Company shall be amended to read in
its entirety the following:
Section 6.7. AMENDMENT OF BY-LAWS. These by-laws may be amended or
repealed, and new by-laws adopted, with the approval of the Board, subject
to any stockholders agreement, and a two-thirds majority of the
stockholders entitled to vote.
<PAGE>
[LETTERHEAD]
October 6, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Gentlemen:
We have read Item 4 of Form 8-K dated October 6, 1998 of Wavetek Wandel &
Goltermann, Inc. and are in agreement with the statements contained in the
second and third paragraphs under Item 4(a) on pages 2 and 3 therein. We
have no basis to agree or disagree with other statements of the registrant
contained therein.
Very truly yours,
/s/ Ernst & Young LLP
