Electro Scientific (ESIO) and Zygo (ZIGO) Terminate Merger Agreement; ESIO Receives $5.4 Million Break Up Fee

April 2, 2009 4:08 PM EDT

Electro Scientific Industries, Inc. (NASDAQ: ESIO) and Zygo Corporation (NASDAQ: ZIGO) announced that they have terminated the Agreement and Plan of Merger, dated October 15, 2008, among ESI, ZYGO and Zirkon Merger Sub, LLC.

As part of the termination, ESI received a break up fee of $5.4 million relating to the ZYGO Board of Directors' withdrawal of its recommendation in favor of the merger of ESI and ZYGO; ZYGO will be required to pay an additional $1.2 million in the event ZYGO announces within the next six months that its Board has approved an alternative transaction proposal for the sale of its business; and each of ESI and ZYGO exchanged mutual general releases. Both Bruce Robinson, chairman and CEO of ZYGO, and Nicholas Konidaris, president and CEO of ESI, expressed hope that ESI and ZYGO will be able to explore ways of working together in the future. [SM]

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