<PAGE>
[LOGO OF CLARENT GOES HERE]
- --------------------------------------------------------------------------------
Filed by Clarent Corporation
Pursuant to Rule 425 under the
Securities Act of 1933 and deemed
filed pursuant to Rule 14a-12 of the
Securities Exchange Act of 1934
Subject Company: ACT Networks, Inc.
Commission File No. 0-25740
- --------------------------------------------------------------------------------
Final - For Immediate Release
Contacts:
Clarent Corporation Morgen-Walke Assoc.
Amy Wright Jason Golz, Quynh Nguyen
650-481-1743 Investor Relations
[email protected] 415-296-7383
---------------
ACT Networks Morgen-Walke Assoc.
Robert J. Faulk Ty George
818-871-6562 Investor Relations
[email protected] 415-296-7383
----------------------
Clarent Announces Acquisition Agreement with ACT Networks
Combined Company to Offer Broad Suite of Intelligent Converged Telephony
Products
REDWOOD CITY and CALABASAS, Calif.-May 1, 2000- Clarent(TM) Corporation (Nasdaq:
CLRN), a worldwide leader in providing carrier-grade, phone-to-phone Internet
Protocol (IP) telephony solutions, today announced the signing of a definitive
agreement to acquire ACT
<PAGE>
Clarent Announces Acquisition Agreement with ACT Networks
Page 2
Networks, Inc. (Nasdaq: ANET). ACT Networks is a leading provider of multi-
service access and voice/data integration products that enable the convergence
of voice, video and data onto one managed network.
Under the terms of the agreement, each outstanding share of ACT Networks
will be exchanged for 0.2546 of a share of Clarent Common Stock. The exchange
ratio will be subject to a `collar' providing a maximum and minimum value of
Clarent Common Stock to be exchanged for each share of ACT Networks at Closing
of $18.00 and $14.00, respectively. Based on Clarent's closing price on Monday,
May 1st, 2000 the company will issue approximately $189 million of stock for the
outstanding shares of ACT in addition to assuming ACT Networks' outstanding
stock options.
The acquisition has been approved by the boards of directors of both
companies and is expected to close in the third quarter of 2000. This
transaction is subject to various closing conditions, including approval by ACT
Networks' stockholders and termination of the necessary waiting period under the
Hart-Scott-Rodino Act.
"Both Clarent and ACT Networks have pursued this transaction because of the
strong belief that synergies exist between our firms' products and business
strategies" stated Jerry Chang, CEO and President, Clarent Corporation. "We
believe that integration of our product solutions will help service providers
and their enterprise customers migrate to and build more scalable, cost-
effective, end-to-end IP telephony networks. Overall, we believe this business
combination allows Clarent to continue to enhance our leadership position in the
service provider market."
"We believe that both companies have demonstrated leadership and strong
customer momentum in the marketplace," said ACT CEO and President Andre de
Fusco. "We expect that our channel, service provider and large enterprise
partners will look to the combined company as the leading supplier of full-
featured IP-based convergent network solutions. By offering a broad portfolio
of voice and data access equipment, fully integrated command and control
software, and state-of-the-art value-added services, we have the further
opportunity to bridge the gap between in-place legacy voice and data networking
systems, and the next generation IP-based service deployment infrastructure."
<PAGE>
Clarent Announces Acquisition Agreement with ACT Networks
Page 3
Clarent is acquiring ACT to expand its product portfolio to include a
comprehensive suite of data networking service access equipment, to increase
product options available to its service provider customer base, to enhance its
development capabilities, and to blend Clarent's current predominantly direct
sales model with ACT's channel driven distribution strategy.
ACT Networks is expected to become a wholly-owned subsidiary and will
continue to be headquartered in Calabasas, CA. Andre de Fusco, 42, President and
CEO of ACT Networks, will join Clarent's management team as President of the ACT
Networks Division.
Thomas Weisel Partners served as financial advisor to Clarent in this
transaction. ACT was represented by Dain Rauscher Wessels.
Forward-Looking Statements
- ---------------------------
This news release contains forward-looking statements that involve risks
and uncertainties that could cause actual results or outcomes to differ
materially from those contemplated by the forward-looking statements. Factors
that could cause or contribute to such differences include, but are not limited
to, risks relating to the consummation of the contemplated merger, including the
risk that required regulatory clearances or stockholder approval might not be
obtained in a timely manner or at all. In addition, statements in this press
release relating to the expected benefits of the contemplated merger are subject
to risks relating to the timing and successful completion of technology and
product development efforts, integration of the technologies and businesses of
Clarent and ACT Networks, unanticipated expenditures, changing relationships
with customers, suppliers and strategic partners and other factors described in
the most recent Form 10-Q, most recent Form 10-K and other periodic reports
filed by each company with the Securities and Exchange Commission.
Additional Information and Where to Find It
- -------------------------------------------
<PAGE>
Clarent Announces Acquisition Agreement with ACT Networks
Page 4
Clarent plans to file a Registration Statement on SEC Form S-4 in
connection with the merger, and Clarent and ACT Networks expect to mail a Proxy
Statement/Prospectus to stockholders of ACT Networks containing information
about the merger. Investors and security holders are urged to read the
Registration Statement and the Proxy Statement/Prospectus carefully when they
are available. The Registration Statement and the Proxy Statement/Prospectus
will contain important information about Clarent, ACT Networks, the merger and
related matters. Investors and security holders will be able to obtain free
copies of these documents through the website maintained by the U.S. Securities
and Exchange Commission at http://www.sec.gov. Free copies of the Proxy
Statement/Prospectus and these other documents may also be obtained from Clarent
by mail to Clarent Corporation, 700 Chesapeake Drive, Redwood City, California,
94063, Attention: Investor Relations, telephone: (650) 817-3999.
In addition to the Registration Statement and the Proxy
Statement/Prospectus, Clarent and ACT Networks file annual, quarterly and
special reports, proxy statements and other information with the Securities and
Exchange Commission. You may read and copy any reports, statements or other
information filed by Clarent or ACT Networks at the SEC public reference rooms
at 450 Fifth Street, N.W., Washington, D.C. 20549 or at any of the Commission's
other public reference rooms in New York, New York and Chicago, Illinois.
Please call the Commission at 1-800-SEC-0330 for further information on the
public reference rooms. Clarent's and ACT Networks' filings with the Commission
are also available to the public from commercial document-retrieval services and
at the web site maintained by the Commission at http://www.sec.gov.
Solicitation of Proxies; Interests of Certain Persons in the Merger.
- ----------------------------------------------------------------------
ACT Networks will be, and certain other persons named below may be,
soliciting proxies from ACT Networks stockholders in favor of the adoption of
the merger agreement. The directors and executive officers of ACT Networks and
the directors and executive officers of Clarent may be deemed to be participants
in ACT Networks' solicitation of proxies.
The following are the directors and executive officers of ACT Networks:
Name Position
- ---- --------
Andre de Fusco President, Chief Executive Officer, and Director
<PAGE>
Clarent Announces Acquisition Agreement with Act Networks
Page 5
William W. Ambrose Director
Archibald J. McGill Director
Frederick W. Gluck Director
Robert Musslewhite Director
Dave Weisman Vice President, Marketing
Alain Gravel Vice President, Engineering
Robert J. Faulk Chief Financial Officer and Vice President, Finance
Eric Grubel Vice President, Worldwide Sales
Ramin Sadr Chief Technology Officer
The following are the directors and executive officers of Clarent:
Name Position
- ---- --------
Jerry Shaw-Yau Chang Chief Executive Officer, President and Director
Michael F. Vargo Senior Vice President, Chief Technology Officer and
Director
William R. Pape Director
Wen Chang Ko Director
Syaru Shirley Lin Director
Richard J. Heaps Chief Operating Officer, Chief Financial Officer,
General Counsel and Secretary
Mark E. McIlvane Senior Vice President, Worldwide Sales
Heidi H. Bersin Senior Vice President, Corporate Marketing and
Communications
Mong Hong (Mahan) Wu Senior Vice President and General Manager, Asia
Pacific
Peter K. Bohacek Senior Vice President, Business Development and
Product Marketing
The directors and executive officers of ACT Networks have interests in the
merger, some of which may differ from, or may be in addition to, those of ACT
Networks' stockholders generally. Those interests include:
* in connection with the merger, Andre de Fusco, Alain Gravel, and certain key
engineers have entered or will enter into employment and noncompetition
agreements with Clarent;
* certain of the directors and executive officers of ACT Networks may own
options to purchase shares of ACT Networks common stock which will become
vested and exercisable in connection with the merger;
<PAGE>
Clarent Announces Acquisition Agreement with ACT Networks
Page 6
* certain of the directors and executive officers of ACT Networks are covered
by severance plans that are triggered in connection with the merger; and
* Clarent has agreed to provide indemnification and director and officer
liability insurance coverage to the directors and executive officers of ACT
Networks following the merger.
About Clarent Corporation
- --------------------------
Clarent Corporation is a premier provider of scalable, IP telephony
products to carriers and Internet service providers around the world. Clarent's
intelligent architecture and the Clarent Command Center enable Clarent products
to route, manage, inter-connect and terminate high volumes of calls for service
provider customers including the world's largest long distance telecommunication
companies. According to an iLocus report published in 1999, more minutes travel
across Clarent-enabled networks worldwide than those of any other equipment
supplier.*
Founded in July 1996, Clarent is headquartered in Redwood City and has
offices in major cities in Asia, Europe, Latin America and North America.
Additional information about Clarent is available at www.clarent.com.
About ACT Networks
- ------------------
ACT Networks develops, manufactures, and markets multi-service access
products that enable the convergence of voice, video, and data onto one managed
network. Service providers and enterprise customers use ACT Networks' products
to build converged networks that are bandwidth efficient, cost-effective and
easy to manage. ACT Networks' award-winning NetPerformer(R) and
ServiceXchange(R) product lines incorporate its unique PowerCell(TM) Technology,
which includes advanced voice and data compression algorithms, enhanced
switching and traffic management, and state-of-the-art telephony integration
technologies to serve enterprise and global carrier customers of all types. For
more information about ACT Networks, headquartered in Calabasas, CA, visit its
corporate web site at http://www.actnetworks.com.
###
Note to Editors: Clarent is a registered trademark of Clarent Corporation in the
United States and other jurisdictions. All other company or product names
mentioned may be trademarks or registered trademarks of the respective companies
with which they are associated.
<PAGE>
Clarent Announces Acquisition Agreement with ACT Networks
Page 7
* "IP Telephony Clearinghouses - A New Business Model." Published November
1999 by iLocus. iLocus, a division of Cape Saffron Ltd., is a UK-based research
group focused on the IP telephony industry. http://www.ilocus.com
ACT Networks and NetPerformer are registered trademarks and ServiceXchange and
PowerCell are trademarks of ACT Networks.
