Finisar Responds to Infineon

Finisar responds to notice by Infineon purporting to terminate agreement to acquire Infineon fiber optics business

January 12, 2005

1 Min Read

SUNNYVALE, Calif. -- Finisar Corporation (NasdaqNM:FNSR - News) announced that on January 11, 2005 it received a notice from Infineon Technologies AG purporting to terminate the purchase agreement dated October 11, 2004, which provides for the acquisition by Finisar of Infineon's fiber optics business unit in exchange for approximately 110 million shares of Finisar common stock.

Infineon's notice alleges, among other things, that the purported termination was based on Finisar's breach of the agreement. Finisar believes that no such breach has taken place.

Prior to receiving Infineon's notice, Finisar had advised Infineon that its Board of Directors was in the process of considering whether, in the proper exercise of its fiduciary duties, it could continue to recommend the transaction to Finisar's stockholders in light of a number of recent adverse developments in Infineon's fiber optics business. The Board engaged in this re-examination of its recommendation in compliance with the terms of the agreement.

Finisar has repeatedly assured Infineon that it is prepared to fulfill its obligations under the agreement, including bringing the transaction to a vote of the Finisar stockholders whether or not the Board's recommendation is modified or withdrawn.

Finisar intends to defend itself vigorously against any legal proceedings that may be instituted by Infineon and to assert appropriate claims for recovery of damages caused by Infineon.

Finisar Corp.

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