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Tsunami to become a wholly owned subsidiary and Tsunami shareholders to receive approximately 3.2M shares of Stratos common stock
January 23, 2002
CHICAGO -- Stratos Lightwave, Inc., (Nasdaq: STLW - news) a leading supplier of optical subsystems and optical components, today announced it has entered into a definitive agreement to acquire Tsunami Optics, Inc., based in Mountain View, California. Tsunami Optics is a privately held company that develops and manufactures innovative fiber optic components and modules that enable the delivery of cost-effective bandwidth in metro communication networks. Tsunami's products include coarse wavelength division multiplexing (CWDM) modules, micro-lithographic optics, and micro-optic components. Under the terms of the agreement, Tsunami will become a wholly owned subsidiary of Stratos and the Tsunami shareholders will receive approximately 3.2 million shares of Stratos common stock. Stratos will also assume approximately $5.9 million of debt, plus certain expenses in connection with this transaction. Provided that Tsunami reaches certain financial performance goals during the twelve month period following the closing, an additional contingent payment of up to $18 million in Stratos common stock will be made in early calendar 2003. Stratos expects the transaction to be accretive for its fiscal year 2003, and this will not be dependent on Tsunami achieving the minimum financial performance goals necessary to begin earning the additional consideration. The transaction will be accounted for as a purchase and is intended to qualify as a tax-free reorganization. The transaction is expected to close early in the Stratos' fourth fiscal quarter of 2002 and is subject to approval by Tsunami's shareholders and other customary conditions."The strategic addition of Tsunami's products and intellectual property to the Stratos family provides us with components that enable low-cost CWDM solutions that integrate with our existing transceiver product lines," said Jim McGinley, President and CEO of Stratos. "Stratos Lightwave is excited about the metro access market where we believe we already have a strong presence. Tsunami's CWDM technology adds additional core competencies to the Stratos offerings for the metro access market. With Tsunami, we offer our customers the broadest product line with higher efficiencies and reliabilities that address the current and future needs of our customers."Stratos Lightwave LLCTsunami Optics
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