American Power Conversion Announces Litigation With Competitor
WEST KINGSTON, R.I. -- American Power Conversion, (Nasdaq: APCC), announced today that a competitor has filed a lawsuit relating to APC's February 1997 acquisition of Systems Enhancement Corporation. The lawsuit, filed by Trippe Manufacturing Company, a privately held company, alleges a variety of contract, antitrust, and unfair competition claims based on the acquisition.
"We believe the lawsuit to be without merit and intend to vigorously defend against it," said Rodger B. Dowdell, Jr., APC's president and CEO. "Since completion of the acquisition, APC has proactively worked with Systems Enhancement's customers to reassure them that all contractual and confidentiality obligations will be fulfilled. Our understanding is that Systems Enhancement's other customers are satisfied with our response to date."
Systems Enhancement develops and markets power management software for the uninterruptible power supply (UPS) industry. The purchase price of the February 1997 transaction was approximately $13 million in shares of APC common stock or 0.5% of APC's outstanding common shares.
In the opinion of management, the ultimate disposition of this matter should not have a material adverse effect on the company's consolidated financial position or results of operations and liquidity.
"This matter has no impact on APC's current financial guidance for the second quarter or fiscal 1997," said Donald M. Muir, APC's chief financial officer.
Safe Harbor Provision
Statements contained in this press release which are not historical factors may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to risks and uncertainties which could cause actual results to differ from those projected. The factors that could cause actual results to differ materially include the following: the timely development and acceptance of new products such as the Symmetra Power Array; ramp up and expansion of manufacturing capacity; general economic conditions and growth rates in the power protection industry and related industries, including but not limited to the PC, server and networking industries; competitive factors and pricing pressures; changes in product mix; changes in the seasonality of demand patterns; inventory risks due to shifts in market demand; component constraints and shortages; risk of nonpayment of accounts receivable; the uncertainty of the litigation process including risk of an unexpectedly, unfavorable result of current litigation; and the risks described from time to time in the Company's filings with the Securities and Exchange Commission.
American Power Conversion, a leader in the design, manufacture and marketing of power protection equipment, including surge suppressors, uninterruptible power supplies (UPS), power conditioning equipment and related software for computer and computer related equipment. APC reported sales of $707 million for the year ended December 31, 1996. The company is headquartered in West Kingston, RI, and its products are distributed worldwide.
American Power Conversion is an affirmative action/equal opportunity employer. All trademarks are the property of their owners.
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/CONTACT: Jodi Kennedy, director of media relations, worldwide ext. 2158 or Deborah K. Grey, investor relations manager, ext. 2994 or Don Muir, chief financial officer, ext. 2105, all of APC, 401-789-5735/
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