AYDIN CORP. Announces Update On Business Restructuring.HORSHAM, Pa.--(BUSINESS WIRE)--June 8, 1998--AYDIN CORP. (NYSE NYSE See: New York Stock Exchange : AYD AYD Advancing Youth Development AYD American Youth for Democracy ) Monday announced its plans and goals for the company's business going forward. Consistent with Aydin's long-term corporate strategy, the company is currently negotiating the sales of the company's West Coast Microwave Components, Displays, and Molded Devices Divisions and closing down its Raytor Division, in order to concentrate full focus on its core Telemetry telemetry Highly automated communications process by which data are collected from instruments located at remote or inaccessible points and transmitted to receiving equipment for measurement, monitoring, display, and recording. and Communications businesses, which represented approximately 80% of 1997 total sales. Completion of these sales and the shut-down is targeted for the third quarter of 1998. The company believes that upon consummation of the Division sales and shut-down of the Raytor Division, the company should return to profitability on an operating basis. The company anticipates that it will not be profitable in the second quarter on an operating basis, due to the need to resolve issues raised by the Lockheed Martin For the former company, see . Lockheed Martin (NYSE: LMT) is a leading multinational aerospace manufacturer and advanced technology company formed in 1995 by the merger of Lockheed Corporation with Martin Marietta. arbitration award An arbitration award (or arbitral award) is a determination on the merits by an arbitration tribunal in an arbitration, and is analogous to a judgment in a court of law. and continuing losses from the Displays Division. Having been profitable on an operating basis for the last two quarters of 1997, with the disposition of assets the company expects to return to operating profitability by the fourth quarter of 1998. I. Gary Bard bard, in Wales, term originally used to refer to the order of minstrel-poets who composed and recited the poems that celebrated the feats of Celtic chieftains and warriors. , chairman and chief executive officer, stated, "While the proceeds of the sale of assets will be used to meet our obligation to satisfy the arbitration award to Lockheed Martin instead of being used for acquisition, our corporate strategy remains to focus the company's resources on being a global communication solutions provider. "The company's management team is committed to growing its leadership position in the aircraft, missile and space telemetry business, to growing its commercial communication business and becoming a significant communications systems In telecommunication, a communications system is a collection of individual communications networks, transmission systems, relay stations, tributary stations, and data terminal equipment (DTE) usually capable of interconnection and interoperation to form an integrated whole. integrator, and to continuing to migrate our Turkish subsidiary from being a single large project company into a diversified defense contractor Noun 1. defense contractor - a contractor concerned with the development and manufacture of systems of defense armed forces, armed services, military, military machine, war machine - the military forces of a nation; "their military is the largest in the region"; in Turkey." The company also announced today that it has reached agreement with Lockheed Martin Corp. regarding payment of the $17.2 million arbitration award won by Lockheed Martin on April 10, 1998. Under the terms of the agreement, the company has withdrawn its appeal of the arbitration award filed in federal court and Lockheed Martin has withdrawn its motion seeking judgment on the award. The company has paid Lockheed Martin $1 million on the award and agreed to pay $.5 million monthly through Dec. 1, 1998. The agreement provides for accelerated payments upon the Division sales, and for payment in full of all obligations to Lockheed Martin by Dec. 15, 1998. The company anticipates that the substantial majority of the award will be paid from the proceeds of the Division sales. If such sales are not consummated, the company would require other sources of funds to meet such obligations. While the company is continuing to explore other potential liquidity sources, there can be no assurance that other sources of funds would be available. The company also announced that it has reached agreement with AT&T Commercial Finance Corp. regarding the company's credit facility with that firm. Under the agreement, the company will satisfy its outstanding obligations in an orderly fashion over the coming months, including repayment of the $1.0 million outstanding on its term loan and establishment of cash collateral for an outstanding $1.6 million letter of credit, and AT&T will not extend further credit to the company. The company noted that since the facility with AT&T Commercial Finance was established in January 1998, it has never borrowed funds under the revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility, although that facility has supported a letter of credit. AYDIN is a world-class provider of products and systems for the acquisition and distribution of information over electronic communications media. The company designs, engineers, manufactures, markets, distributes and installs technologically advanced communications products and systems, from basic components to turnkey systems A complete system of hardware and software delivered to the customer ready-to-run. In other words, just "turn the key" and go.  A Turnkey Video System for military, space, government and commercial organizations around the world. Except for the historical matters contained in this press release, statements made in this press release are forward-looking and are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Investors are cautioned that these forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. reflect numerous assumptions and involve risks and uncertainties which may affect AYDIN's business and prospects and cause actual results to differ materially from these forward-looking statements, including loss of current customers, reductions in orders from current customers, or delays in ordering by current customers, failure to obtain anticipated contracts or orders from new customers, or expected volume from such customers, higher material or labor costs, unfavorable results in litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. against AYDIN, the availability of adequate sources of working capital, consummation of planned Division sales, and economic, competitive, technological, governmental, and other factors discussed in AYDIN's filings with the Securities and Exchange Commission.
CONTACT: AYDIN CORP.
Laura Pennza, 215/658-4502
E-mail: lpennza@aydin.com
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