Gilat Seeks Enforcement Of Merger Deal Or Damages After Comtech' Filing Of Amended Complaint

(RTTNews) - Gilat Satellite Networks Ltd. (GILT) said it plans to file a counter claim seeking enforcement of the merger agreement or hundreds of millions of dollars in monetary damages following Comtech Telecommunications Corp.'s filing of an amended complaint.

Gilat said it was notified on July 11, 2020 that an amended complaint was filed by Comtech Telecommunications Corp. and its subsidiary, Convoy Ltd., against Gilat in the Court of Chancery of the State of Delaware. The amended complaint seeks an additional declaratory judgment that Gilat has suffered a "Material Adverse Effect", as a result of the Covid-19 pandemic and, as a consequence, Comtech is not required to consummate the merger because certain closing conditions of the Merger Agreement cannot be satisfied.

Gilat said it strongly rejected all such allegations. Gilat believed that no Material Adverse Effect under the merger agreement has occurred and that Comtech's complaint is nothing more than an effort to avoid its clear contractual obligation to acquire Gilat, due to Comtech's own rapidly deteriorating performance.