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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 29, 1998
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
Date of report (Date of earliest event reported): July 22, 1998
INNOVA CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
WASHINGTON
(State or Other Jurisdiction of Incorporation)
000-22931 91-1453311
(Commission File Number) (I.R.S. Employer Identification No.)
3325 SOUTH 116TH STREET, SEATTLE, WA 98168
(Address of Principal Executive Offices) (Zip Code)
(206) 439-9121
(Registrant's Telephone Number, Including Area Code)
With a copy to:
Marion V. Larson, Esq.
GRAHAM & JAMES LLP/RIDDELL WILLIAMS P.S.
1001 Fourth Avenue Plaza, Suite 4500
Seattle, WA 98154
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ITEM 5. OTHER EVENTS.
On July 22, 1998, the Registrant, Digital Microwave Corporation, a
Delaware corporation ("DMC"), and Iguana Merger Corp., a Washington corporation,
and a wholly owned subsidiary of DMC ("Sub"), entered into an Agreement and Plan
of Reorganization and Merger (the "Merger Agreement") providing for a merger of
Sub with and into Registrant. Under the terms of the Merger Agreement,
Registrant's shareholders will receive 1.05 shares of DMC's common stock for
each outstanding share of Registrant's common stock held by them. The merger is
intended to qualify as a tax-free reorganization and a pooling-of-interests for
accounting and financial reporting purposes, and is subject to certain
conditions, including the approval of the respective stockholders of the
Registrant and DMC.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.1 Press Release issued by the Registrant and DMC dated July 23, 1998.
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SIGNATURES
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 hereunto duly authorized.
INNOVA CORPORATION
Date: July 29, 1998 By: /s/JOHN M. HEMINGWAY
---------------------------------
John M. Hemingway
Secretary and Chief Financial
Officer
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EXHIBIT 99.1
Sheryl Lewis, Financial Community, Digital Microwave Corp., (408) 944-1740
Jeanne Harper-Condren, Press, Digital Microwave Corp., (408) 944-1817
John Hemingway, Innova Corporation, (206) 439-9121
FOR IMMEDIATE RELEASE
DIGITAL MICROWAVE CORPORATION AND INNOVA CORPORATION
SIGN DEFINITIVE MERGER AGREEMENT;
COMBINATION CREATES LARGEST INDEPENDENT GLOBAL WIRELESS
TRANSMISSION SOLUTIONS PROVIDER
SAN JOSE, CA AND SEATTLE, WA--July 23, 1998 Digital Microwave Corporation
(Nasdaq: DMIC) and Innova Corporation (Nasdaq: INVA), jointly announced today
that they have signed a definitive agreement by which Innova Corporation would
merge with Digital Microwave Corporation. The combined company will be the
largest independent provider of wireless transmission solutions for worldwide
voice and data networks. The combination of these two companies will allow
Digital Microwave Corporation's unified global sales and service operations to
offer a broad range of complementary products and services.
Under the terms of the agreement, Digital Microwave will exchange 1.05
shares of its common stock for each outstanding share of Innova common stock.
Digital Microwave will also exchange stock options and warrants using the same
ratio, and expects to issue up to 18.5 million shares to Innova shareholders,
option, and warrant holders. Innova shareholders will own approximately 27% of
the combined entity. The resulting transaction represents a premium of
approximately 28% to Innova's 30-day average closing price. The transaction,
which has been approved by the respective Boards of Directors, is expected to
close within approximately 90 days, subject to regulatory reviews, approval by
each company's stockholders, and other customary closing conditions. Special
Meetings of the shareholders of both companies are to be
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convened to approve the transaction. The merger is intended to qualify as a
tax-free reorganization and will be accounted for as a pooling-of-interests
transaction.
"We are extremely pleased to announce our intention to merge with
Innova," said Charles D. Kissner, Digital Microwave's Chairman and Chief
Executive Officer. "This combination will immediately offer our global customers
a full range of highly competitive wireless solutions. Combining with Innova
makes sense not only because of our complementary products and skills,
especially Innova's low-cost technology for its low-to-medium capacity products
and Digital Microwave's high-capacity Altium(TM) radio platform, but also
because there is very little overlap in the customer bases we currently serve.
Additionally, the combined product development capabilities will accelerate the
ability to bring to market important new products to serve new emerging data
services and voice network applications. We believe this merger will enhance
that capability both immediately and in the long term, which we expect to
benefit not only our customers, but also enhance the value to shareholders of
both companies."
Frank Grenon, President and Chief Executive Officer of Innova, said, "We
believe the merger clearly creates a company with unmatched competitive position
in the marketplace. Innova's focus over the past few years has been on reducing
costs of its low-to-medium capacity products, and is a perfect complement to
Digital Microwave's new advances in high-capacity radio systems and their strong
global sales, distribution, and service network. The merger provides
complementary product platforms, increases the customer base and distribution
channels, and will allow both companies to accelerate progress toward their
objectives. We are committed to providing our customers with the best
combination of price/performance, service, and support in the industry."
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The statements made in this release concerning Digital Microwave's and
Innova's future prospects, including statements concerning the ability to offer
a full range of competitive wireless solutions, competitive position,
accelerated ability to introduce new products, and the immediate and long-term
benefits to customers, and enhanced stockholder value, are "forward-looking
statements" under the Federal securities laws. Because such statements apply to
future events, they are subject to risks and uncertainties that could cause the
actual results to differ materially, including without limitation, integration
risks related to the proposed transaction; the risk that the contemplated
benefits of the proposed transaction will not be realized; the risk that the
proposed transaction will not be consummated; and the risk of the impact of
competitive products and developments, market conditions, general economic
conditions, new technologies and industry standards. Important factors which
could cause actual results to differ materially are described in the report on
Form 10-K for the year ended March 31, 1998 filed by Digital Microwave
Corporation and the report on Form 10-QA for the quarter ended March 31, 1998
filed by Innova Corporation with the Securities and Exchange Commission.
Headquartered in San Jose, Digital Microwave 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.
Headquartered in Seattle, Innova designs, manufactures and supports
millimeter wave radios for use as low-to-medium capacity wireless communication
links in developed and developing telecommunications markets. Innova's products
enable telecommunications service providers to establish reliable and
cost-effective voice, data and video communications links
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within their networks. Innova's products operate in frequencies ranging from
13-38 GHz and may be used in various applications, including cellular and
PCS/PCN networks, broadband communications, local loop services and long
distance networks. Altium is a trademark of Digital Microwave Corporation.
