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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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) January 14, 2000
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WATKINS-JOHNSON COMPANY
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(Exact name of registrant as specified in Charter)
California 1-5631 94-1402710
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(State or Other Jurisdiction (Commission File (IRS Employer
of Incorporation) Number) Identification No.)
3333 Hillview Avenue, Palo Alto, California 94304-1223
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (650) 493-4141
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None
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS
On January 14, 2000, Watkins Johnson Company (the "Company") issued a
press release announcing the closing of the sale of substantially all of the
assets of its Telecommunications Group to BAe Aerospace Electronic Systems
Inc. Also on January 14, 2000, the Company issued a press release announcing
that it had reached a tentative settlement of pending litigation against the
Company related to the proposed merger of an affiliate of Fox Paine &
Company with the Company (the "WJ Merger"). The press releases are attached
hereto as Exhibit 99.1 and 99.2, respectively, and are incorporated herein by
this reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) EXHIBITS
Exhibit 99.1 Press release issued by the Company on January 14, 2000
relating to the closing of the Telecommunications Group sale.
Exhibit 99.2 Press release issued by the Company on January 14, 2000 related
to the tentative settlement of certain litigation challenging the
WJ Merger.
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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 herewith duly authorized.
Date: January 14, 2000 WATKINS-JOHNSON COMPANY
By: /s/ W. Keith Kennedy
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W. Keith Kennedy, Jr., President
and Chief Executive Officer
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EXHBIT INDEX
Exhibit 99.1 Press release issued by the Company on January 14, 2000
relating to the closing of the Telecommunications Group sale.
Exhibit 99.2 Press release issued by the Company on January 14, 2000 related
to the tentative settlement of certain litigation challenging the
WJ Merger.
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Exhibit 99.1
FOR FURTHER INFORMATION:
MEDIA: JUDY BRENNAN (SARD VERBINNEN & CO) 212-687-8080
ANDREW COLE
INVESTOR CONTACT: FRANK E. EMERY (WATKINS-JOHNSON) 650-813-2752
FOR IMMEDIATE RELEASE
WATKINS-JOHNSON COMPLETES SALE OF ITS
TELECOMMUNICATION GROUP TO BAE SYSTEMS
PALO ALTO, CALIF. JANUARY 14, 2000 -- Watkins-Johnson Company (NYSE: WJ)
announced today that it has completed the sale of substantially all the assets
of its Telecommunications Group to the North American unit of BAE SYSTEMS. Prior
to November 1999 when British Aerospace merged with Marconi Electronic Systems
of General Electric Company plc, Marconi North America was part of GEC's Marconi
Electronic Systems Group. As announced August 1999, the purchase price is $57.9
million, subject to a post-closing balance sheet adjustment.
The Telecommunications Group sale was approved by a majority of
Watkins-Johnson shares at a special meeting held January 14, 2000 at the
company's headquarters in Palo Alto, Calif. This was the first of two special
meetings of WJ shareowners being held within a few weeks of one another. At
the second meeting, scheduled for January 31, 2000, shareowners will vote on
a separate transaction, announced last October, in which a new company formed
by investment funds managed by Fox Paine & Company will acquire
Watkins-Johnson Company in a recapitalization merger for $41.125 per share.
At this second meeting, the proxy card is BLUE to aid shareowners in
distinguishing it.
The sale of WJ's Telecommunications Group to a subsidiary of BAE SYSTEMS is part
of a strategy of the Watkins-Johnson Board of Directors, announced on March 1,
1999, to maximize shareowner value through the sale of the company. If the
subsequent Fox Paine merger is completed, the strategy will have been fully
implemented.
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THIS NEWS RELEASE, OTHER THAN THE HISTORICAL FINANCIAL INFORMATION, CONSISTS OF
FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES IN CONSUMMATING
THE PROPOSED FOX PAINE MERGER AND THE OTHER RISKS DETAILED FROM TIME TO TIME IN
THE COMPANY'S SEC REPORTS, INCLUDING THE REPORT ON FORM 10-K/A FOR THE YEAR
ENDED DEC. 31, 1998. ACTUAL RESULTS MAY VARY MATERIALLY.
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EXHIBIT 99.2
FOR FURTHER INFORMATION:
MEDIA: JUDY BRENNAN (SARD VERBINNEN & CO) 212-687-8080
ANDREW COLE
INVESTOR CONTACT: FRANK EMERY (WATKINS-JOHNSON) 650-813-2752
FOR RELEASE ON APPROVAL
WATKINS-JOHNSON COMPANY ANNOUNCES TENTATIVE
SETTLEMENT OF CHALLENGES TO RECAPITALIZATION
PALO ALTO, CALIF. JANUARY 14, 2000 - Watkins-Johnson Company (NYSE:WJ)
announced today that it has reached a tentative settlement with the
plaintiffs' counsel in the litigation opposing the proposed recapitalization
merger with an affiliate of investment funds managed by Fox Paine & Company,
LLC. As previously announced, pursuant to a recapitalization merger,
Watkins-Johnson's shareowners would be entitled to receive $41.125 per share
in cash. Following the announcement of the recapitalization merger
transaction in October 1999, Watkins-Johnson and its directors, in addition
to other parties, were named as defendants in several purported shareowner
class actions challenging the proposed transaction. The tentative settlement
being announced today, which is subject to the execution of a definitive
settlement agreement and judicial approval, would provide for a release of
the claims asserted in the lawsuits.
Pursuant to the tentative settlement agreement, the Fox Paine entity, FP-WJ
Acquisition Corp., has agreed, immediately and irrevocably, to reduce the
"break-up" fee payable under certain circumstances following a termination of
the recapitalization merger agreement from $13.25 million to $8.75 million.
In addition, Watkins-Johnson agreed to retain a qualified investment-banking
firm to render an additional opinion as to the fairness of the
recapitalization merger transaction.
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THIS NEWS RELEASE, OTHER THAN THE HISTORICAL FINANCIAL INFORMATION, CONSISTS OF
FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES IN COMPLETION OF
THE LITIGATION SETTLEMENT AND CONSUMMATING THE PROPOSED FOX PAINE MERGER AND THE
OTHER RISKS DETAILED FROM TIME TO TIME IN THE COMPANY'S SEC REPORTS, INCLUDING
THE REPORT ON FORM 10-K/A FOR THE YEAR ENDED DEC. 31, 1998. ACTUAL RESULTS MAY
VARY MATERIALLY.
