NEWS RELEASE
HEI INC. LOGO
P. O. Box 5000
Victoria, Minnesota 55386 USA
952-443-2500
CONTACTS: FOR IMMEDIATE RELEASE
Anthony J. Fant, CEO
Donald R. Reynolds, President/COO
Steve E. Tondera, CFO
HEI, INC. ANNOUNCES IT NO LONGER INTENDS TO COMMENCE EXCHANGE OFFER
MINNEAPOLIS, October 17, 2000 -- HEI, Inc. (Nasdaq: HEII, www.heii.com) today
announced that it no longer intends to commence an exchange offer for Colorado
MEDtech, Inc. (Nasdaq: CMED) or solicit proxies for the removal and replacement
of the current CMED board. HEI cited negative market conditions, the
announcement of legal claims that may be asserted against CMED, and the
continued refusal of the CMED board to discuss a sale or other options to
maximize shareholder value as being among the reasons for its decision.
HEI also announced today that it has voluntarily dismissed its lawsuit against
Colorado MEDtech and the CMED board of directors. The lawsuit has been
discontinued without prejudice.
"We considered the acquisition of CMED to be strategically appropriate for both
companies, but only on terms that reflect their relative value," said Anthony
Fant, Chairman and Chief Executive Officer of HEI, Inc. "Furthermore, the
announcement that the former shareholder of CIVCO may assert claims in excess of
$5 million dollars against Colorado MEDtech has caused us to step back and
re-analyze the situation." "While we continue to assess our investment in CMED,
we certainly do not preclude taking future action to maximize the value of that
investment" added Mr. Fant.
"Our business strategy and financial goals are unaffected by this decision,"
said Don Reynolds, President and Chief Operating Officer." "We are excited about
our strategic growth plan and remain focused on building shareholder value." "We
will continue to seek acquisitions that complement our technology and our
strategic plan," Reynolds added.
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HEI, Inc., and Cross Technology, Inc., a wholly owned subsidiary of HEI, Inc.,
specialize in the custom design and manufacture of high performance,
ultraminiature microelectronic devices and high-technology products
incorporating those devices. HEI and Cross contribute to their customers'
competitiveness in the hearing, medical, communications, wireless smart cards,
other RF applications, and industrial markets through innovative design
solutions and by the application of state-of-the art materials, processes and
manufacturing capabilities.
Headquarters and Microelectronics Division PO Box 5000, 1495 Steiger Lake Lane, Victoria, MN 55386
Mexico Division, Customer Service Center 777 East MacArthur Circle, Tucson, AZ 85714
High Density Interconnect Division 610 South Rockford Drive, Tempe, AZ 85281
Cross Technology, Inc. 1546 Lake Drive West, Chanhassen, MN 55317
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FORWARD LOOKING INFORMATION Information in this news release, which is not
historical, includes forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Statements
contained in this press release including effects of acquisitions on our
strategic growth and financial plans are forward looking statements. All of such
forward-looking statements involve risks and uncertainties including, without
limitation, adverse business or market conditions, the ability of HEI to secure
and satisfy customers, the availability and cost of materials from HEI's
suppliers, adverse competitive developments, change in or cancellation of
customer requirements, and other risks detailed from time to time in HEI's SEC
filings.
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