AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 25, 2000
REGISTRATION NO. 333-37554

SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
AMENDMENT NO. 5 TO
 FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
WILSON GREATBATCH TECHNOLOGIES, INC.
(Exact Name of Registrant as Specified in its Charter)

          DELAWARE                        3692                    16-1531026
(State or Other Jurisdiction        (Primary Standard          (I.R.S. Employer
    of Incorporation or                Industrial           Identification Number)
       Organization)           Classification Code Number)	

10,000 WEHRLE DRIVE
CLARENCE, NEW YORK 14031
 (716) 759-6901
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)

EDWARD F. VOBORIL
PRESIDENT, CHIEF EXECUTIVE OFFICER AND CHAIRMAN OF THE BOARD
WILSON GREATBATCH TECHNOLOGIES, INC.
10,000 WEHRLE DRIVE
CLARENCE, NEW YORK 14031
 (716) 759-6901
(Name, Address Including Zip Code, and Telephone Number, Including Area Code, of
Agent for Service)
COPIES TO:

  STEVEN D. RUBIN, ESQ.                                   STEPHEN E. OLDER, ESQ.
WEIL, GOTSHAL & MANGES LLP                                EDWARD D. SOPHER, ESQ.
700 LOUISIANA, SUITE 1600                       AKIN, GUMP, STRAUSS, HAUER & FELD, L.L.P.
   HOUSTON, TEXAS 77002                                     590 MADISON AVENUE
      (713) 546-5000                                     NEW YORK, NEW YORK 10022
                                                              (212) 872-1000	

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. / /
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /

If delivery of this prospectus is expected to be made pursuant to Rule 434, check the following box. / /
CALCULATION OF REGISTRATION FEE

                                                 AMOUNT              PROPOSED MAXIMUM        PROPOSED MAXIMUM
          TITLE OF EACH CLASS                     TO BE             OFFERING PRICE PER          AGGREGATE
    OF SECURITIES TO BE REGISTERED           REGISTERED (1)             SHARE (2)           OFFERING PRICE (2)
Common stock, par value $.001 per share     5,405,000 shares              $17.00               $91,885,000

          TITLE OF EACH CLASS                  AMOUNT OF
    OF SECURITIES TO BE REGISTERED          REGISTRATION FEE
Common stock, par value $.001 per share        $24,258(3)	

(1) Includes 705,000 shares of common stock that the underwriters may purchase solely to cover over-allotments, if any.
(2) Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(o).
(3) A registration fee in the amount of $30,360.00 was paid in connection with the initial filing of this Registration Statement on May 22, 2000.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.

SUBJECT TO COMPLETION--AUGUST , 2000

WE WILL AMEND AND COMPLETE THE INFORMATION IN THIS PROSPECTUS. ALTHOUGH WE ARE PERMITTED BY U.S. FEDERAL SECURITIES LAWS TO OFFER THESE SECURITIES USING THIS PROSPECTUS, WE MAY NOT SELL THEM OR ACCEPT YOUR OFFER TO BUY THEM UNTIL THE DOCUMENTATION FILED WITH THE SEC RELATING TO THESE SECURITIES HAS BEEN DECLARED EFFECTIVE BY THE SEC. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES OR OUR SOLICITATION OF YOUR OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THAT WOULD NOT BE PERMITTED OR LEGAL.

PROSPECTUS
 , 2000
[LOGO]
WILSON GREATBATCH TECHNOLOGIES
SHARES OF COMMON STOCK

WILSON GREATBATCH TECHNOLOGIES, INC.:
- We are a leading developer and manufacturer of power sources and other components used in implantable medical devices, including wet tantalum capacitors and precision components.
- 10,000 Wehrle Drive
Clarence, New York 14031
(716) 759-6901
PROPOSED TRADING SYMBOL AND MARKET:
- GB / New York Stock Exchange
THE OFFERING:
- We are offering 4,700,000 shares of our common stock.
- The underwriters have an option to purchase an additional 705,000 shares of common stock to cover over-allotments.
- This is our initial public offering and no public market currently exists for our shares.
- We anticipate that the initial public offering price for our shares will be between $15.00 and $17.00 per share.
- We plan to use the net proceeds of this offering to repay indebtedness.
- Closing: , 2000.

-------------------------------------------------------------------------------------
                                                         Per Share          Total
-------------------------------------------------------------------------------------
Public offering price:                                       $                $
Underwriting fees:
Proceeds to Wilson Greatbatch Technologies, Inc.:
-------------------------------------------------------------------------------------	

THIS INVESTMENT INVOLVES RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 7.
Neither the SEC nor any state securities commission has determined whether this prospectus is truthful or complete. Nor have they made, nor will they make, any determination as to whether anyone should buy these securities. Any representation to the contrary is a criminal offense.

DONALDSON, LUFKIN & JENRETTE MERRILL LYNCH & CO.
BANC OF AMERICA SECURITIES LLC
U.S. BANCORP PIPER JAFFRAY
DLJDIRECT INC.

MEDICAL PRODUCTS
COMPONENTS FOR IMPLANTABLE DEVICES
[Photograph of Feedthrough]
FEEDTHROUGHS
HIGHLY DURABLE SEAL
MULTIFUNCTIONAL
[Photograph of Precision Components]
PRECISION COMPONENTS
HIGH LEVEL OF MANUFACTURING PRECISION
BROAD MANUFACTURING FLEXIBILITY
[Close-up Photograph of Electrode Tip]
ELECTRODE TIPS
PRECISION QUALITY COATED SURFACE
CUSTOMIZED OFFERING OF SURFACES AND TIPS

                                                [Diagram of ICD showing location
[Photograph of a Capacitor]                     of components]
CAPACITORS                                      IMPLANTABLE CARDIOVERTER
PROPRIETARY TECHNOLOGY                          DEFIBRILLATOR SHOWING COMPONENTS
ENABLES COMPONENT SIZE REDUCTION OF UP TO 50%   FROM WILSON GREATBATCH
ALLOWS A WIDE RANGE OF CUSTOM CONFIGURATIONS    TECHNOLOGIES, INC.	

[Photograph of four Implantable Power Sources] 
IMPLANTABLE POWER SOURCES
INDUSTRY STANDARD
PROPRIETARY TECHNOLOGIES
DECADES OF IMPLANT EXPERIENCE WITH SUPPORTIVE LIFE TEST DATA
COMMERCIAL PRODUCTS
HIGH PERFORMANCE, SAFE AND RELIABLE PRIMARY POWER SUPPLIES . . .
[Photograph of various power sources]
. . . SPECIFICALLY DESIGNED FOR THE MOST DEMANDING APPLICATIONS SUCH AS SPACE FLIGHT, OCEANOGRAPHY AND PETROLEUM EXPLORATION
[Photographs of a space shuttle, oceanographic exploration and a drilling rig]
[Logo]

TABLE OF CONTENTS

                                          PAGE
                                        --------
Prospectus Summary.....................     1
Risk Factors...........................     7
Forward Looking Statements.............    16
Use of Proceeds........................    17
Dividend Policy........................    17
Capitalization.........................    18
Dilution...............................    20
Selected Consolidated Financial Data...    21
Management's Discussion and Analysis of
  Financial Condition and Results of
  Operations...........................    23	

                                          PAGE
                                        --------
Business...............................    36
Management.............................    49
Related Party Transactions.............    56
Principal Stockholders.................    62
Description of Capital Stock...........    64
Shares Eligible for Future Sale........    67
Underwriting...........................    69
Legal Matters..........................    72
Experts................................    72
Where You Can Find More Information....    72
Index to Consolidated Financial
  Statements...........................   F-1	

i

PROSPECTUS SUMMARY
YOU SHOULD READ THIS SUMMARY TOGETHER WITH THE MORE DETAILED INFORMATION REGARDING US AND THE COMMON STOCK BEING SOLD IN THIS OFFERING AND OUR HISTORICAL
CONSOLIDATED FINANCIAL STATEMENTS AND NOTES TO THE HISTORICAL CONSOLIDATED FINANCIAL STATEMENTS APPEARING ELSEWHERE IN THIS PROSPECTUS.
WILSON GREATBATCH TECHNOLOGIES, INC.
OUR BUSINESS
We are a leading developer and manufacturer of power sources and other components used in implantable medical devices, including wet tantalum capacitors and precision components. We believe that we are a preferred supplier of power sources and components because we offer technologically advanced, highly reliable and long lasting products for implantable medical devices. Through continuous technological innovation and improvements, we have enabled our customers to continually develop and introduce implantable medical devices that are progressively smaller, longer lasting, more efficient and more functional. Our customers include leading implantable medical device manufacturers such as Guidant, St. Jude Medical and Medtronic, the three largest manufacturers of pacemakers and implantable cardioverter defibrillators, or ICDs, based on revenues. We leverage our core competencies in technology and manufacturing to develop and produce power sources for commercial applications that demand high performance and reliability, including aerospace, oil and gas exploration and oceanographic equipment.
Our history, market leadership and reputation for quality and technological innovation in the implantable medical device industry began with Mr. Wilson Greatbatch, who patented the implantable pacemaker in 1962 and founded our company in 1970. We continue to develop pioneering technology used in implantable medical devices and other demanding commercial applications. As of July 1, 2000, we employed 135 scientists, engineers and technicians. To remain a leader in developing new technology, we also maintain close relationships with a number of research organizations, clinicians and other industry professionals. Since 1970, our company has received 321 patents worldwide, and as of July 1, 2000, we held 137 active patents.
We work closely with our customers to enable them to develop innovative medical devices that utilize our specially designed, proprietary power sources and components. We believe that our proprietary technology, close customer relationships, market leadership and dedication to quality provide us with significant competitive advantages over our competitors and create a barrier to entry for potential market entrants.
STRATEGY
Our objective is to enhance our position as a leading developer and manufacturer of power sources and other components for implantable medical devices. We intend to:
- expand our proprietary technology portfolio through continuous technological innovation and continue to focus our research, development and engineering efforts on pioneering power sources and advanced components for implantable medical devices;
- enhance our position as an integrated component supplier to the implantable medical device industry by broadening our product line to include a more comprehensive range of power sources and components;
- continue to collaborate with our customers to jointly develop new technologies that enable them to develop and market increasingly more effective and technologically innovative products; and
- enter into strategic alliances and make selective acquisitions that complement our core competencies in technology and manufacturing for both implantable medical devices and other demanding commercial applications.
1

IMPLANTABLE MEDICAL DEVICE INDUSTRY
An implantable medical device is an instrument that is surgically inserted into the body to provide diagnosis or therapy. The market for our implantable power sources and components benefits directly from the growth of the implantable medical device industry. The largest and fastest growing segment of the implantable medical device market is cardiac rhythm management, which includes devices such as pacemakers and ICDs. Pacemakers treat bradycardia, a condition that occurs when a patient has an abnormally slow heartbeat, by stimulating the heart with regular electrical pulses. ICDs treat tachycardia, a condition that occurs when a patient has a rapid and irregular heartbeat, by delivering concentrated and timed electrical energy to the heart to restore a normal heart rate.
The use of implantable medical devices has grown as advances in technology have enabled the treatment of a wider range of conditions. As the size of implantable medical devices has become smaller, implantation has become less invasive, making the use of these devices more attractive to patients and surgeons. Emerging applications, such as the treatment of congestive heart failure and atrial fibrillation, a condition associated with an unsynchronized motion of the atrium that produces an irregular heartbeat, increased ease of implantation and the general aging of the population are expected to drive the growth of the implantable medical device industry. Medical Data International, an independent industry publisher, estimates that revenues from pacemakers sold worldwide will increase from $2.6 billion in 1999 to $3.6 billion in 2004, representing a compound annual growth rate of 6.7%. Medical Data International also estimates that revenues from ICDs sold worldwide will increase from $1.5 billion in 1999 to $5.5 billion in 2004, representing a compound annual growth rate of 29.7%. The faster growth predicted for the ICD market is predicated on anticipated new applications for, and greater acceptance of, ICDs.
As a leading developer and manufacturer of power sources and other components for implantable medical devices, we believe that our company will continue to be well positioned to meet the requirements of manufacturers of these products.
2

PRODUCTS
We currently manufacture and market 26 models of pacemaker batteries and 15 models of ICD batteries as well as numerous other components for our customers in the implantable medical device industry. Our commercial power sources are used in aerospace, oil and gas exploration and oceanographic equipment. The following table provides information about our principal products:

                                                                                       PRINCIPAL PRODUCT
PRODUCT                        DESCRIPTION                        USED IN              ATTRIBUTES
-------                        -----------                        -------              -----------------
MEDICAL:
  Implantable power sources    Batteries for implantable medical  Pacemakers, ICDs,    High reliability and
                               devices                            left ventricular     predictability
                                                                  assist devices,      Long service life
                                                                  neurostimulators,    Customized configuration
                                                                  drug pumps and       Light weight
                                                                  hearing assist       Compact and less intrusive
                                                                  devices

  Capacitors                   Store energy generated by a        ICDs                 Stores more energy per unit
                               battery before delivery to the                          volume (energy density) than
                               heart                                                   other existing technologies
                                                                                       Customized configuration
  Medical components:

    Feedthroughs               Allow electrical signals to be     Pacemakers, ICDs,    Ceramic to metal seal is
                               brought from inside an             left ventricular     substantially more durable than
                               implantable medical device to an   assist devices,      traditional seals
                               electrode                          neurostimulators,    Multifunctional
                                                                  drug pumps and
                                                                  hearing assist
                                                                  devices

    Electrodes                 Deliver electrical signal from     Pacemakers and ICDs  High quality coated surface
                               the feedthrough to a body part                          Flexible in utilizing any
                               undergoing stimulation                                  combination of biocompatible
                                                                                       coating surfaces
                                                                                       Customized offering of surfaces
                                                                                       and tips

    Precision components       Machined and molded parts for      Pacemakers, ICDs     High level of manufacturing
                               implantable medical devices        and drug pumps       precision
                                                                                       Broad manufacturing flexibility

COMMERCIAL:

  Commercial power sources     Batteries for demanding            Aerospace, oil and   Long-life dependability
                               commercial applications            gas exploration and  High energy density
                                                                  oceanographic
                                                                  equipment	

3

THE OFFERING

Common stock offered.........................  4,700,000 shares
Common stock to be outstanding after this
  offering...................................  17,852,814 shares
Use of proceeds..............................  Repayment of a portion of our Term A and Term
                                               B loans
Proposed NYSE symbol.........................  GB	

The outstanding share information is based on our shares outstanding as of August 15, 2000. Unless otherwise indicated, the outstanding share information gives effect to our August 7, 2000 purchase of Battery Engineering, Inc. for 339,856 shares of common stock and assumption of approximately $2.7 million of indebtedness and our sale of 200,000 shares of common stock to Hitachi Maxell, Ltd., the former parent of Battery Engineering, Inc. This information excludes 584,683 shares of common stock issuable upon exercise of outstanding stock options at a weighted average exercise price of $8.95 per share and an aggregate of 1,086,689 shares of common stock that were available for future issuance under our stock option plans as of August 15, 2000. Unless otherwise indicated, the information in this prospectus assumes no exercise of the underwriters' over-allotment option to purchase additional shares of our common stock and all common stock figures reflect a one-for-three reverse stock split that occurred in May 2000 and a three-for-five reverse stock split that occurred in August 2000.
Our facilities are located in greater Buffalo, New York, Canton Massachusetts and Columbia, Maryland. Our principal executive offices are located at 10,000 Wehrle Drive, Clarence, New York 14031. Our telephone number at that location is (716) 759-6901. Our Internet address is WWW.GREATBATCH.COM.
4

SUMMARY CONSOLIDATED FINANCIAL DATA
 (IN THOUSANDS, EXCEPT PER SHARE DATA)
The following table provides summary consolidated financial data of our company for the periods indicated. You should read the summary consolidated financial data set forth below in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and with our consolidated financial statements and related notes appearing elsewhere in this prospectus.
The unaudited pro forma consolidated statement of operations data and cash flow data for the year ended December 31, 1999 and for the six months ended June 30, 2000 give effect to this offering and the application of the net proceeds of this offering to repay a portion of our indebtedness as if this offering and the repayment of indebtedness had occurred on January 2, 1999. The as adjusted consolidated balance sheet data is adjusted as if this offering and the repayment of indebtedness had occurred on June 30, 2000 and gives effect to our purchase of Battery Engineering, Inc. for 339,856 shares of common stock and assumption of approximately $2.7 million of indebtedness and our sale of 200,000 shares of common stock to the former parent of Battery Engineering, Inc.

                                                                                                                       PRO FORMA
                                                       YEAR ENDED             PRO FORMA        SIX MONTHS ENDED       SIX MONTHS
                                                -------------------------    YEAR ENDED     -----------------------      ENDED
                                                JANUARY 1,   DECEMBER 31,   DECEMBER 31,     JULY 2,      JUNE 30,     JUNE 30,
                                                 1999(1)         1999           1999           1999         2000         2000
CONSOLIDATED STATEMENT OF OPERATIONS DATA:
Total revenues................................   $ 77,361      $79,235        $ 79,235       $38,318      $46,584       $46,584
Cost of goods sold............................     36,454       41,057          41,057        19,385       26,385        26,385
                                                 --------      -------        --------       -------      -------       -------
Gross profit..................................     40,907       38,178          38,178        18,933       20,199        20,199

Selling, general and administrative...........     11,484        9,880           9,880         5,124        5,132         5,132
Research, development and engineering.........     12,190        9,339           9,339         5,130        5,046         5,046
Intangible amortization.......................      5,197        6,510           6,510         3,266        3,267         3,267
                                                 --------      -------        --------       -------      -------       -------
                                                   12,036       12,449          12,449         5,413        6,754         6,754
Interest expense..............................     10,572       13,420           7,173         6,519        7,787         4,058
Other.........................................        364        1,343           1,343           129           71            71
                                                 --------      -------        --------       -------      -------       -------
Income (loss) before income taxes.............      1,100       (2,314)          3,933        (1,235)      (1,104)        2,625
Income tax expense (benefit)..................        410         (605)          1,023          (321)        (328)          780
Cumulative effect of accounting change........         --         (563)           (563)         (563)          --            --
                                                 --------      -------        --------       -------      -------       -------
Net income (loss).............................   $    690      $(2,272)       $  2,347(4)    $(1,477)     $  (776)      $ 1,845
                                                 ========      =======        ========       =======      =======       =======
Net earnings (loss) per share (2):
  Basic.......................................   $   0.07      $ (0.18)       $   0.14       $ (0.12)     $ (0.06)      $  0.11
  Diluted.....................................   $   0.06      $ (0.18)       $   0.14       $ (0.12)     $ (0.06)      $  0.11
Weighted average shares outstanding (2):
  Basic.......................................     10,461       12,491          16,991        12,406       12,615        17,115
  Diluted.....................................     10,677       12,491          17,237        12,406       12,615        17,341

CONSOLIDATED CASH FLOW DATA:
Cash provided by operating activities.........   $  8,927      $ 6,900             N/A       $ 4,060      $ 8,417           N/A
Cash used in investing activities.............    (83,375)      (8,847)            N/A        (3,882)      (3,507)          N/A
Cash provided by (used in) financing
  activities..................................     76,269        1,670             N/A        (2,858)      (6,320)          N/A
EBITDA (3)....................................     20,543       22,152             N/A        11,015       12,760           N/A	

                                                                 AT JUNE 30, 2000
                                                              -----------------------
                                                               ACTUAL    AS ADJUSTED
CONSOLIDATED BALANCE SHEET DATA:
Cash and cash equivalents...................................  $  2,453     $  3,747(5)
Total assets................................................   184,361      192,459
Total debt..................................................   126,562       60,889
Total stockholders' equity..................................    45,561      120,993	

5

(1) In August 1998, we acquired the assets and liabilities of Hittman Materials and Medical Components, Inc., or Hittman. These figures include the results of operations of Hittman from August 8, 1998 to January 1, 1999.
(2) We calculate basic earnings per share by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. We calculate diluted earnings (loss) per share by adjusting for common stock equivalents, which consist of stock options. During the year ended December 31, 1999, the six months ended July 2, 1999 and June 30, 2000 and the pro forma six months ended June 30, 2000, there were options to purchase 246, 283, 226 and 226 shares of common stock, respectively, that were not included in the computation of diluted earnings per share because to do so would be antidilutive for those periods. Diluted earnings per share for the year ended January 1, 1999 includes the potentially dilutive effect of stock options.
(3) When we refer to EBITDA, we mean net earnings or loss before interest expense, income taxes, depreciation and amortization. We have included EBITDA because our management and industry analysts generally consider it to be a measurement of the financial performance of our company that provides a relevant basis for comparison among companies. EBITDA is not a measurement of financial performance under accounting principles generally accepted in the United States and should not be considered a substitute for net income or loss as a measure of performance, or to cash flow as a measure of liquidity. Investors should note that this calculation of EBITDA might differ from similarly titled measures for other companies.
(4) The pro forma net income for the year ended December 31, 1999 does not include an expense, net of tax, of $1.5 million as a result of the early extinguishment of indebtedness.
(5) The as adjusted cash and cash equivalents excludes $2.8 million of cash received from Hitachi-Maxell, Ltd. related to the sale of 200,000 shares of our common stock. Such cash is restricted and is being maintained in an escrow account.
6

RISK FACTORS
BEFORE YOU INVEST IN OUR COMMON STOCK, YOU SHOULD UNDERSTAND THE HIGH DEGREE OF RISK INVOLVED. YOU SHOULD CONSIDER CAREFULLY THE FOLLOWING RISKS AND OTHER INFORMATION IN THIS PROSPECTUS, INCLUDING OUR HISTORICAL CONSOLIDATED FINANCIAL STATEMENTS AND RELATED NOTES, BEFORE YOU DECIDE TO PURCHASE SHARES OF OUR COMMON STOCK. THE FOLLOWING RISKS AND UNCERTAINTIES ARE NOT THE ONLY ONES WE FACE. HOWEVER, THESE ARE THE RISKS OUR MANAGEMENT BELIEVES ARE MATERIAL. IF ANY OF THE FOLLOWING RISKS ACTUALLY OCCUR, OUR BUSINESS, FINANCIAL CONDITION AND OPERATING RESULTS COULD BE ADVERSELY AFFECTED. AS A RESULT, THE TRADING PRICE OF OUR
COMMON STOCK COULD DECLINE AND YOU COULD LOSE PART OR ALL OF YOUR INVESTMENT.
RISKS RELATED TO OUR BUSINESS
WE DEPEND HEAVILY ON A LIMITED NUMBER OF CUSTOMERS, AND IF WE LOSE ANY OF
THEM, WE WOULD LOSE A SUBSTANTIAL PORTION OF OUR REVENUES.
A substantial portion of our business in 1999 was conducted with a limited number of customers, including Guidant, St. Jude Medical, Medtronic, Biotronik and Sulzer Intermedics, which was acquired by Guidant in 1999. Guidant accounted for approximately 33% of our revenues and St. Jude Medical accounted for approximately 31% of our revenues in 1999. As a result, we depend heavily on revenues from Guidant and St. Jude Medical. Our supply agreements, particularly with our large customers, might not be renewed in the future after they expire, including our agreements with Guidant, which expires in 2001, and St. Jude Medical, which expires in 2003. Our supply agreements with St. Jude Medical, Medtronic, Biotronik and Guidant do not require that our customers maintain any minimum purchase levels. The loss of any large customer for any reason could harm our business, financial condition and results of operations.
IF WE DO NOT RESPOND TO CHANGES IN TECHNOLOGY, OUR PRODUCTS MAY BECOME OBSOLETE AND WE MAY EXPERIENCE REDUCED SALES AND A LOSS OF CUSTOMERS, WHICH WOULD NEGATIVELY AFFECT OUR REVENUES.
We sell our products to customers in several industries that are characterized by rapid technological changes, frequent new product introductions and evolving industry standards. For example, in 1998, an industry-wide design change in ICDs occurred, resulting in new ICDs using one battery instead of two. Primarily as a result of this design change, our implantable power source revenues decreased 19% in 1999 compared to 1998. Without the timely introduction of new products and enhancements, our products and services will likely become technologically obsolete over time and we may lose a number of our customers. In addition, other new products introduced by our customers may require fewer of our power sources or components. We dedicate a significant amount of resources to the development of our power sources and other products and technologies and we would be harmed if we did not meet customer requirements and expectations. Our inability, for technological or other reasons, to successfully develop and introduce new and innovative power sources and other products could cause our business to suffer. If this occurs, our revenues and operating results would suffer.
IF WE ARE UNABLE TO SUCCESSFULLY MARKET OUR CURRENT OR FUTURE PRODUCTS, OUR
BUSINESS WILL BE HARMED.
The market for our power sources, components and other products has been growing in recent years. If the market for our products does not grow as rapidly as forecasted by industry experts, our revenues could be less than expected. In addition, it is difficult to predict the rate at which the market for our products will grow or at which new and increased competition will result in market saturation. Slower growth in the pacemaker and ICD markets in particular would negatively impact our revenues. In addition, we face the risk that our products will lose widespread market acceptance. We cannot assure you that our customers will continue to utilize the products we offer or that a market will develop for our future products. We may at times determine that it is not technically or economically
7

feasible for us to manufacture future products and we may not be successful in developing or marketing them. Additionally, new technologies that we develop may not be rapidly accepted because of industry-specific factors, including the need for regulatory clearance, entrenched patterns of clinical practice and uncertainty over third party reimbursement. If this occurs, our business will be harmed.
WE ARE CURRENTLY EXPERIENCING LOSSES AND MAY NOT BECOME PROFITABLE IN THE
FUTURE.
We are currently experiencing losses and we cannot assure you that we will become profitable in the foreseeable future, if ever. For the six months ended June 30, 2000, and the year ended December 31, 1999, we had losses of $0.8 million and $2.3 million, respectively. Even if we do achieve profitability, we may be unable to sustain or increase our profitability in the future.
AMORTIZATION OF OUR INTANGIBLE ASSETS, WHICH REPRESENT A SIGNIFICANT PORTION OF OUR TOTAL ASSETS, WILL ADVERSELY IMPACT OUR NET INCOME AND WE MAY NEVER REALIZE THE FULL VALUE OF OUR INTANGIBLE ASSETS.
As of December 31, 1999, we had $112.9 million of intangible assets, representing 59% of our total assets and 243% of our stockholders' equity. These intangible assets consist primarily of goodwill arising from our acquisition of Hittman and accruals relating to our trademarks and patented technology. We expect to incur amortization expenses relating to these intangible assets of $8.0 million in each of 2000 and 2001. These expenses will reduce our future earnings or increase our future losses. We may not receive the recorded value for our intangible assets if we sell or liquidate our business or assets. The material concentration of intangible assets increases the risk of a large charge to earnings in the event that the recoverability of these intangible assets are impaired, and in the event of such a charge to earnings, the market price of our common stock could be adversely affected.
WE ARE SUBJECT TO PRICING PRESSURES FROM CUSTOMERS, WHICH COULD HARM OUR
OPERATING RESULTS.
We have made price concessions to some of our large customers in recent years and we expect customer pressure for pricing concessions will continue. Further, price concessions or reductions may cause our operating results to suffer. In addition, any delay or failure by a large customer to make payments due to us also could harm our operating results or financial condition.
QUALITY PROBLEMS WITH OUR POWER SOURCES AND OTHER PRODUCTS COULD HARM OUR REPUTATION FOR PRODUCING HIGH QUALITY PRODUCTS AND ERODE OUR COMPETITIVE ADVANTAGE.
Our power sources and other products are held to high quality standards. In the event our power sources and other products fail to meet these standards, our reputation for producing high quality power sources and other products could be harmed, which would damage our competitive advantage.
OUR OPERATING RESULTS MAY FLUCTUATE, WHICH MAY MAKE IT DIFFICULT TO FORECAST
OUR FUTURE PERFORMANCE AND MAY RESULT IN VOLATILITY IN OUR STOCK PRICE.
Our operating results have fluctuated in the past and are likely to fluctuate significantly from quarter to quarter due to a variety of factors, including:
- the fixed nature of a substantial percentage of our costs, which results in our operations being particularly sensitive to fluctuations in revenue;
- changes in the relative portion of our revenue represented by our various products and customers, which could result in reductions in our profits if the relative portion of our revenue represented by lower margin products increases. For a discussion of a recent fluctuation in our operating results due to a shift in the relative portion of our revenue among product lines, see "Management's Discussion and Analysis of Financial Condition and Results of Operations--Results of Operations--First Six Months of 2000 Compared to First Six Months of 1999--Gross profit";
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- timing of orders placed by our principal customers who account for a significant portion of our revenues; and
- increased costs of raw materials or supplies.
IF WE ARE UNABLE TO PROTECT OUR INTELLECTUAL PROPERTY AND PROPRIETARY
RIGHTS, OUR BUSINESS COULD BE ADVERSELY AFFECTED.
We rely on a combination of patents, licenses, trade secrets and know-how to establish and protect our proprietary rights to our technologies and products. As of July 1, 2000, we held 137 active patents. We cannot guarantee that the steps we have taken or will take to protect our proprietary rights will be adequate to deter misappropriation of our intellectual property. In addition to seeking formal patent protection whenever possible, we attempt to protect our proprietary rights and trade secrets by entering into confidentiality and non-compete agreements with employees, consultants and third parties with which we do business. However, these agreements can be breached and, if they are, there may not be an adequate remedy available to us and we may be unable to prevent the unauthorized disclosure or use of our technical knowledge, practices or procedures. If our trade secrets become known, we may lose our competitive advantages.
In addition, we may not be able to detect unauthorized use of our intellectual property and take appropriate steps to enforce our rights. If third parties infringe or misappropriate our patents or other proprietary rights, our business could be seriously harmed. We may be required to spend significant resources to monitor our intellectual property rights, we may not be able to detect infringement of these rights and may lose our competitive advantages associated with our intellectual property rights before we do so. In addition, competitors may design around our technology or develop competing technologies that do not infringe on our proprietary rights.
WE MAY BE SUBJECT TO INTELLECTUAL PROPERTY CLAIMS, WHICH COULD BE COSTLY AND TIME CONSUMING AND COULD DIVERT OUR MANAGEMENT AND KEY PERSONNEL FROM OUR BUSINESS OPERATIONS.
In producing our power sources and other components for implantable medical devices, third parties may claim that we are infringing their intellectual property rights, and we may be found to have infringed those intellectual property rights. While we do not believe that any of our products infringe the intellectual property rights of third parties, we may be unaware of intellectual property rights of others that may be used in our technology and products. In addition, third parties may claim that our patents have been improperly granted and may seek to invalidate our existing or future patents. Although we do not believe that any of our active patents should be subject to invalidation, if any claim for invalidation prevailed, the result could be greatly expanded opportunities for third parties to manufacture and sell products which compete with our products. We also typically do not receive significant indemnification from parties which license technology to us against third party claims of intellectual property infringement. Any litigation or other challenges regarding our patents or other intellectual property could be costly and time consuming and could divert our management and key personnel from our business operations. The complexity of the technology involved in producing our power sources and other components for implantable medical devices, and the uncertainty of intellectual property litigation increase these risks. Claims of intellectual property infringement might also require us to enter into costly royalty or license agreements. However, we may not be able to obtain royalty or license agreements on terms acceptable to us, or at all. We also may be subject to significant damages or injunctions against development and sale of our products. Infringement claims, even if not substantiated, could result in significant legal and other costs and may be a distraction to management.
IF WE BECOME SUBJECT TO PRODUCT LIABILITY CLAIMS, OUR EARNINGS AND FINANCIAL
CONDITION COULD SUFFER.
The manufacture and sale of our products expose us to potential product liability claims and product recalls, including those which may arise from misuse or malfunction of, or design flaws in, our
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products or use of our products with components or systems not manufactured or sold by us. Provisions contained in our agreements with key customers attempting to limit our damages, including provisions to limit damages to liability for gross negligence, may not be enforceable in all instances or may otherwise fail to protect us from liability for damages. Product liability claims or product recalls, regardless of their ultimate outcome, could require us to spend significant time and money in litigation or otherwise or require us to pay significant damages. The occurrence of product liability claims or product recalls could cause our earnings and financial condition to suffer.
We carry product liability insurance coverage which is limited in scope and amount. Our management believes that our insurance coverage is adequate given the risks we face. We cannot assure you that we will be able to maintain this insurance or to do so at reasonable cost and on reasonable terms. We also cannot assure you that this insurance will be adequate to protect us against a product liability claim that arises in the future.
WE ARE DEPENDENT UPON OUR SENIOR MANAGEMENT TEAM AND KEY PERSONNEL AND THE
LOSS OF ANY OF THEM COULD SIGNIFICANTLY HARM US.
Our future performance depends to a significant degree upon the continued contributions of our senior management team and key technical personnel. Our products are highly technical in nature. In general, only highly qualified and trained scientists have the necessary skills to develop our power sources and other products. The loss or unavailability to us of any member of our senior management team or a key technical employee could significantly harm us. We face intense competition for these professionals from our competitors, our customers and other companies operating in our industry. To the extent that the services of members of our senior management team and key technical personnel would be unavailable to us for any reason, we would be required to hire other personnel to manage and operate our company and to develop our products and technology. We cannot assure you that we would be able to locate or employ such qualified personnel on acceptable terms.
WE MAY NOT BE ABLE TO ATTRACT, TRAIN AND RETAIN A SUFFICIENT NUMBER OF
QUALIFIED PROFESSIONALS TO MAINTAIN AND GROW OUR BUSINESS.
Our success will depend in large part upon our ability to attract, train, retain and motivate highly-skilled employees and management. There is currently aggressive competition for employees who have experience in technology and engineering that is used in manufacturing and producing power sources and other components for implantable medical devices. We compete intensely with other companies to recruit and hire from this limited pool. The industries in which we compete for employees are characterized by high levels of employee attrition. Although we believe we offer competitive salaries and benefits, we may have to increase spending in order to retain personnel. In 1999, we temporarily reduced salaries company-wide by 10% and later restored salaries to their original levels. In connection with these salary reductions, we implemented various measures to retain our existing employees, including granting stock options to some of our key employees to compensate for the 10% reduction in salaries. If a number of our employees resign from our company to join or form a competitor, the loss of these employees and any resulting loss of existing or potential clients to a competitor could harm our business, financial condition and results of operations. Any inability to attract, train, retain and motivate employees and management would cause our business, financial condition and results of operations to suffer.
WE RELY ON THIRD PARTY SUPPLIERS FOR RAW MATERIALS, KEY PRODUCTS AND SUBCOMPONENTS AND IF WE ARE UNABLE TO OBTAIN THESE MATERIALS, PRODUCTS AND SUBCOMPONENTS ON A TIMELY BASIS OR ON TERMS ACCEPTABLE TO US, OUR ABILITY TO MANUFACTURE PRODUCTS WILL SUFFER.
Our business depends on a continuous supply of raw materials. The principal raw materials used in our business include lithium, iodine, plastics, cases, lids, glass, screens, tantalum, ruthenium, tantalum pellets and vanadium pentoxide. Raw materials needed for our business are susceptible to fluctuations
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due to transportation, government regulations, price controls, economic climate or other unforeseen circumstances. In addition, there are a limited number of worldwide suppliers of the lithium needed to manufacture our products. We cannot assure you that we will be able to continue to procure raw materials critical to our business.
We rely on third party manufacturers to supply many of our raw materials. For example, we rely on FMC to supply us with lithium for our power sources and HC Starks to supply us with tantalum powder and wire for capacitors. Manufacturing problems may occur with these and other outside sources, as a supplier may fail to develop and supply products and subcomponents to us on a timely basis, or may supply us with products and subcomponents that do not meet our quality, quantity and cost requirements. If any of these problems occur, we may be unable to obtain substitute sources of these products and subcomponents on a timely basis or on terms acceptable to us, which could harm our ability to manufacture our own products and components profitably or on time. In addition, to the extent the processes that our suppliers use to manufacture products and subcomponents are proprietary, we may be unable to obtain comparable subcomponents from alternative suppliers.
WE MAY FACE COMPETITION FROM ONE OF OUR PRINCIPAL CUSTOMERS THAT COULD HARM OUR BUSINESS AND WE MAY BE UNABLE TO COMPETE SUCCESSFULLY AGAINST NEW ENTRANTS AND ESTABLISHED COMPANIES WITH GREATER RESOURCES.
Competition in connection with the manufacturing of power sources for implantable medical devices may intensify in the future. One or more of our customers that manufactures implantable medical devices may undertake additional vertical integration initiatives and begin to manufacture some or all of their power source needs. Although Medtronic manufactures its own lithium batteries for its pacemakers and ICDs, to date, to our knowledge, Medtronic has not sold batteries to third parties. In 1999, Medtronic introduced a new ICD that reduced the number of batteries from two to one and caused us to lose some unit volume. If Medtronic were to begin selling power sources for implantable medical devices to third parties, our revenues could be harmed. As the implantable medical device industry continues to consolidate, this risk will intensify. Many of our potential implantable power source and component competitors, which include some of our customers, have greater name recognition, longer operating histories, larger customer bases, longer customer relationships and greater financial, technical, personnel and marketing resources than our company.
The market for commercial power sources is competitive, fragmented and subject to rapid technological change. Many other commercial power source suppliers are larger and have greater financial, operational, personnel, sales, technical and marketing resources than our company. These and other companies may develop products that are superior to ours, which could cause our results of operations to suffer.
ACCIDENTS AT ONE OF OUR FACILITIES COULD DELAY PRODUCTION AND ADVERSELY
AFFECT OUR OPERATIONS.
Our business involves complex manufacturing processes and hazardous materials that can be dangerous to our employees. Although we employ safety procedures in the design and operation of our facilities and we have not experienced any serious accidents or deaths, there is a risk that an accident or death could occur in one of our facilities. Any accident, such as a chemical spill, could result in significant manufacturing delays or claims for damages resulting from injuries, which would harm our operations and financial condition. The potential liability resulting from any such accident or death, to the extent not covered by insurance, could cause our business to suffer. Any disruption of operations at any of our facilities could harm our business.
IF WE ARE NOT SUCCESSFUL IN MAKING ACQUISITIONS TO EXPAND AND DEVELOP OUR
BUSINESS, OUR FINANCIAL RESULTS MAY SUFFER.
A component of our strategy is to make selective acquisitions that complement our core competencies in technology and manufacturing to enable us to manufacture and sell additional
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products to our existing customers and to expand our business into related markets. For example, in August 1998, we acquired Hittman, a medical components manufacturer. Our continued growth will depend on our ability to identify and acquire companies that complement or enhance our business on acceptable terms. We may not be able to identify or complete future acquisitions. Some of the risks that we may encounter include expenses associated with, and difficulties in identifying, potential targets, the costs associated with incomplete acquisitions and higher prices for acquired companies because of competition for attractive acquisition targets. Our failure to acquire additional companies could cause our financial results to suffer.
WE MAY MAKE ACQUISITIONS THAT COULD SUBJECT US TO A NUMBER OF OPERATIONAL RISKS AND WE MAY NOT BE SUCCESSFUL IN INTEGRATING COMPANIES WE ACQUIRE INTO OUR EXISTING OPERATIONS.
We expect to make selective acquisitions that complement our core competencies in technology and manufacturing to enable us to manufacture and sell additional products to our existing customers and to expand our business into related markets. However, implementation of our acquisition strategy entails a number of risks, including:
- inaccurate assessments of undisclosed liabilities;
- diversion of our management's attention from our core businesses;
- potential loss of key employees or customers of the acquired businesses;
- difficulties in integrating the operations and products of an acquired business or in realizing projected efficiencies and cost savings; and
- increases in our indebtedness and a limitation in our ability to access additional capital when needed.
WE INTEND TO EXPAND INTO NEW MARKETS AND OUR PROPOSED EXPANSION PLANS MAY
NOT BE SUCCESSFUL.
We intend to expand into new markets through the development of new product applications based on our existing component technologies. These efforts have required, and will continue to require, us to make substantial investments, including significant research, development and engineering expenditures and capital expenditures for new, expanded or improved manufacturing facilities. We cannot assure you that we will be able to successfully manage expansion into new markets and products or that these efforts will not have an adverse impact on our business. Specific risks in connection with expanding into new markets include the inability to transfer our quality standards into new products, the failure of customers in new markets to accept our products and price competition.
OUR FAILURE TO OBTAIN LICENSES FROM THIRD PARTIES FOR NEW TECHNOLOGIES OR THE LOSS OF THESE LICENSES COULD IMPAIR OUR ABILITY TO DESIGN AND MANUFACTURE NEW PRODUCTS.
We occasionally license technologies from third parties rather than depending exclusively on our own proprietary technology and developments. For example, we license wet tantalum technology from the Evans Capacitor Company to produce our capacitors. Our ability to license new technologies from third parties is and will continue to be critical to our ability to offer new and improved products. We cannot assure you that we will be able to continue to identify new technologies developed by others and even if we are able to identify new technologies, we may not be able to negotiate licenses on favorable terms, or at all. Additionally, we could lose rights granted under licenses for reasons beyond our control. For example, the licensor could lose patent protection for a number of reasons, including invalidity of the licensed patent.
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RISKS RELATED TO OUR INDUSTRY
WE AND OUR CUSTOMERS ARE SUBJECT TO VARIOUS POLITICAL, ECONOMIC AND REGULATORY CHANGES IN THE HEALTHCARE INDUSTRY WHICH COULD FORCE US TO MAKE MODIFICATIONS TO HOW WE DEVELOP AND PRICE OUR PRODUCTS.
The healthcare industry is highly regulated and is influenced by changing political, economic and regulatory factors. Several of our product lines are subject to international, federal, state and local health and safety, packaging and product content regulations. In addition, implantable medical device products produced by our healthcare customers are subject to regulation by the United States Food and Drug Administration, or FDA, and similar international agencies. These regulations govern a wide variety of product activities from design and development to labeling, manufacturing, promotion, sales and distribution. Compliance with these regulations may be time consuming, burdensome and expensive and could negatively affect our customers' abilities to sell their products, which in turn would adversely affect our ability to sell our products. This may result in higher than anticipated costs or lower than anticipated revenues.
These regulations are also complex, change frequently and have tended to become more stringent over time. Federal and state legislatures have periodically considered programs to reform or amend the U.S. healthcare system at both the federal and state levels. In addition, these regulations may contain proposals to increase governmental involvement in healthcare, lower reimbursement rates or otherwise change the environment in which healthcare industry participants operate. We may be required to incur significant expenses to comply with these regulations or remedy past violations of these regulations. Any failure by our company to comply with applicable government regulations could also result in cessation of portions or all of our operations, impositions of fines and restrictions on our ability to carry on or expand our operations. In addition, because many of our products are sold into regulated industries, we must comply with additional regulations in marketing our products.
OUR BUSINESS IS SUBJECT TO ENVIRONMENTAL REGULATIONS THAT COULD BE COSTLY
FOR OUR COMPANY TO COMPLY WITH.
Federal, state and local regulations impose various environmental controls on the manufacturing, transportation, storage, use and disposal of batteries and hazardous chemicals and other materials used in the manufacturing of batteries. We cannot assure you that conditions relating to our historical operations which may require expenditures for clean-up will not arise in the future or that changes in environmental laws and regulations will not impose costly compliance requirements on us or otherwise subject us to future liabilities. We also cannot assure you that additional or modified regulations relating to the manufacture, transportation, storage, use and disposal of materials used to manufacture our batteries or restricting disposal of batteries will not be imposed. In addition, we cannot predict the effect that additional or modified regulations may have on us or our customers.
CONSOLIDATION IN THE HEALTHCARE INDUSTRY COULD HAVE AN ADVERSE EFFECT ON OUR
REVENUES AND RESULTS OF OPERATIONS.
Many healthcare industry companies are consolidating to create new companies with greater market power. As the healthcare industry consolidates, competition to provide products and services to industry participants will become more intense. These industry participants may try to use their market power to negotiate price concessions or reductions for our products. If we are forced to reduce our prices because of consolidation in the healthcare industry, our revenues would decrease and our results of operations would suffer.
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OUR BUSINESS IS INDIRECTLY SUBJECT TO HEALTHCARE INDUSTRY COST CONTAINMENT
MEASURES THAT COULD RESULT IN REDUCED SALES OF OUR PRODUCTS.
Our healthcare customers rely on third party payors, such as government programs and private health insurance plans, to reimburse some or all of the cost of the procedures in which our products are used. The continuing efforts of government, insurance companies and other payors of healthcare costs to contain or reduce those costs could lead to patients being unable to obtain approval for payment from these third party payors. If that occurred, sales of implantable medical devices may decline significantly, and our customers may reduce or eliminate purchases of our products. The cost containment measures that healthcare providers are instituting, both in the United States and internationally, could harm our ability to operate profitably.
OUR COMMERCIAL POWER SOURCE REVENUES ARE DEPENDENT ON CONDITIONS IN THE OIL
AND NATURAL GAS INDUSTRY, WHICH HISTORICALLY HAS BEEN VOLATILE.
Sales of our commercial power sources depend to a great extent upon the condition of the oil and gas industry and, specifically, the exploration and production expenditures of oil and gas companies. In the past, oil and natural gas prices have been volatile and the oil and gas exploration and production industry has been cyclical, and it is likely that oil and natural gas prices will continue to fluctuate in the future. The current and anticipated prices of oil and natural gas influence the oil and gas exploration and production business and are affected by a variety of political and economic factors beyond our control, including worldwide demand for oil and natural gas, worldwide and domestic supplies of oil and natural gas, the ability of the Organization of Petroleum Exporting Countries, or OPEC, to set and maintain production levels and pricing, the level of production of non-OPEC countries, the price and availability of alternative fuels, political stability in oil producing regions and the policies of the various governments regarding exploration and development of their oil and natural gas reserves. An adverse change in the oil and gas exploration and production industry or a reduction in the exploration and production expenditures of oil and gas companies could cause our revenues from commercial power sources to suffer.
RISKS RELATED TO THIS OFFERING
AN ACTIVE PUBLIC TRADING MARKET FOR OUR COMMON STOCK MAY NOT DEVELOP AND THE
MARKET PRICE OF OUR COMMON STOCK MAY DECLINE BELOW THE PRICE OF THIS OFFERING.
Prior to this offering, you could not buy or sell our common stock publicly. Although we intend to apply to have our common stock listed on The New York Stock Exchange, an active public market for our common stock might not develop or be sustained after this offering. Moreover, even if an active market does develop, the market price of our common stock may decline below the initial public offering price.
THE POSSIBLE VOLATILITY OF OUR STOCK PRICE COULD ADVERSELY AFFECT OUR
STOCKHOLDERS.
Securities markets worldwide have recently experienced significant price and volume fluctuations, and the market prices of the securities of technology companies have been especially volatile. This market volatility, as well as general economic, market or political conditions, could reduce the market price of our common stock in spite of our operating performance. In addition, our operating results could be below the expectations of public market analysts and investors, and in response, the market price of our common stock could decrease significantly. Investors may be unable to resell their shares of our common stock at or above the initial public offering price. In the past, companies that have experienced volatility in the market price of their stock have been the object of securities class action litigation. If we were to become the object of securities class action litigation, we may face substantial costs and our management's attention and resources may be diverted, which could harm our business.
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DLJ MERCHANT BANKING PARTNERS II, L.P. AND SOME OF ITS AFFILIATES CONTROL THE MAJORITY OF OUR VOTING STOCK AND AS A RESULT EXERT SIGNIFICANT INFLUENCE
OVER US AND MAY HAVE INTERESTS THAT CONFLICT WITH THOSE OF OTHER STOCKHOLDERS, INCLUDING PURCHASERS IN THIS OFFERING.
DLJ Merchant Banking Partners II, L.P. and some of its affiliates, which we refer to collectively as DLJ Merchant Banking, have substantial control over our company and may have different interests than those of other holders of our common stock. Prior to this offering, DLJ Merchant Banking held 77.8% of our outstanding common stock and after this offering, these entities will beneficially own approximately 57.3%, or 55.1% if the underwriters exercise their over-allotment option in full, of our outstanding common stock. As a result of its stock ownership and related contractual rights, DLJ Merchant Banking has significant control over our business policies and affairs, including the power to:
- nominate all but one member of our Board of Directors and elect our directors;
- appoint new management; and
- approve any action requiring the approval of the holders of common stock, including the adoption of amendments to our restated certificate of incorporation and approval of mergers or sales of all substantially all of our assets.
The parties to the stockholders agreements have agreed to vote in favor of DLJ Merchant Banking's director nominees. The directors elected by DLJ Merchant Banking have the ability to control decisions affecting the business and management of our company, including our capital structure. This includes the issuance of additional capital stock, the implementation of stock repurchase programs and the declaration of dividends.
The general partners of each of the entities comprising DLJ Merchant Banking are affiliates or employees of Donaldson, Lufkin & Jenrette Securities Corporation, one of the joint book-running managers of this offering.
FUTURE SALES OF OUR COMMON STOCK COULD ADVERSELY AFFECT OUR STOCK PRICE.
Sales of a substantial number of shares of common stock after this offering, or the perception that these sales could occur, could adversely affect the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities. Immediately after this offering, affiliates and holders of "restricted securities," as defined in Rule 144 under the Securities Act, will own 13,152,814 shares, representing approximately 73.7%, or 70.9% if the underwriters exercise their over-allotment option in full, of the outstanding shares of common stock. A decision by these persons to sell shares of common stock could adversely affect the trading price of our common stock.
WE HAVE VARIOUS MECHANISMS IN PLACE TO DISCOURAGE TAKEOVER ATTEMPTS, WHICH MAY REDUCE OR ELIMINATE YOUR ABILITY TO SELL YOUR SHARES FOR A PREMIUM IN A CHANGE OF CONTROL TRANSACTION.
Various provisions of our restated certificate of incorporation and bylaws and in Delaware corporate law may discourage, delay or prevent a change in control or takeover attempt of our company by a third party which is opposed to by our management and Board of Directors. Public stockholders who might desire to participate in such a transaction may not have the opportunity to do so. These anti-takeover provisions could substantially impede the ability of public stockholders to benefit from a change of control or change in our management and Board of Directors. These provisions include:
- authorizing the issuance of "blank check" preferred stock that could be issued by our Board of Directors to increase the number of outstanding shares and thwart a takeover attempt;
- limiting who may call special meetings of our stockholders; and
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- establishing advance notice requirements for nominations of candidates for election to our Board of Directors or for proposing matters that can be acted upon by our stockholders at stockholder meetings.
YOU WILL SUFFER IMMEDIATE AND SUBSTANTIAL DILUTION.
The initial public offering price of our common stock will be substantially higher than the book value per share of our outstanding common stock. If you purchase common stock in this offering, you will incur immediate and substantial dilution in the net tangible book value per share of the common stock from the price you paid.
ABSENCE OF DIVIDENDS COULD REDUCE OUR ATTRACTIVENESS TO INVESTORS.
Some investors favor companies that pay dividends, particularly in market downturns. We currently intend to retain any future earnings for funding growth and, therefore we do not currently anticipate paying cash dividends on our common stock in the foreseeable future. Because we may not pay dividends, your return on this investment likely depends on your ability to sell our stock for a profit.
FORWARD LOOKING STATEMENTS
Some of the statements under "Prospectus Summary," "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Business" and elsewhere in this prospectus constitute forward-looking statements. We have based these forward-looking statements on our current expectations, which are subject to known and unknown risks, uncertainties and assumptions. They include statements relating to:
- future revenues, expenses and profitability;
- the future development and expected growth of our business and the implantable medical device industry;
- our ability to successfully execute our business model and our business strategy;
- our ability to identify trends within the industries for implantable medical devices, medical components and commercial power sources and to offer products and services that meet the changing needs of those markets;
- projected capital expenditures; and
- trends in government regulation.
You can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially from those suggested by these forward-looking statements. In evaluating these statements, you should carefully consider the risks outlined under "Risk Factors."
In this prospectus, we rely on and refer to information and statistics regarding the implantable medical device industry and our market share in the sectors in which we compete. We obtained this information and statistics from various third party sources, discussions with our customers and/or our own internal estimates. We believe that these sources and estimates are reliable, but we have not independently verified them.
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USE OF PROCEEDS
We estimate that the proceeds of this offering, assuming an initial public offering price of $16.00 per share, which is the midpoint of the anticipated offering price range, and after deducting underwriting discounts and commissions and estimated offering expenses of $6.8 million payable by us, will be approximately $68.4 million, or $78.9 million if the underwriters exercise their over-allotment option in full.
We plan to use the net proceeds of this offering to repay indebtedness as follows:
- $29.6 million, or $34.1 million if the underwriters exercise their over-allotment option in full, of our Term A loans which bear an annual interest rate, at our option, of prime plus 2.25% or LIBOR plus 3.50% and are due and payable on September 30, 2004. As of July 1, 2000, the interest rate for our Term A loans was 10.31%; and
- $38.8 million, or $44.8 million if the underwriters exercise their over-allotment option in full, of our Term B loans which bear an annual interest rate, at our option, of prime plus 2.50% or LIBOR plus 3.75% and are due and payable on September 30, 2006. As of July 1, 2000, the interest rate for our Term B loans was 10.28%.
DLJ Capital Funding, Inc., which led a syndicate of financial institutions that extended us the Term A loans and Term B loans, will receive approximately $1.3 million, or $1.5 million if the underwriters exercise their over-allotment option in full, as its pro rata share of the proceeds of this offering to be applied to the Term A loans and Term B loans. DLJ Capital Funding, Inc. is affiliated with DLJ Merchant Banking, which holds approximately 78% of our outstanding common stock.
DIVIDEND POLICY
We do not intend to pay cash dividends in the foreseeable future. We currently intend to retain any earnings to further develop and grow our business and to reduce our indebtedness. We are a holding company and are dependent on distributions from our subsidiaries to meet our cash requirements. The terms of the credit agreement governing our credit facility restrict the ability of our subsidiaries to make distributions to us and, consequently, restrict our ability to pay dividends on our common stock.
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CAPITALIZATION
The following table sets forth our cash and capitalization as of June 30, 2000 on an unaudited actual basis, unaudited pro forma basis and on an unaudited as adjusted basis. Our capitalization pro forma gives effect to our August 7, 2000 purchase of Battery Engineering, Inc. for 339,856 shares of common stock and assumption of approximately $2.7 million of indebtedness and our sale of 200,000 shares of common stock to Hitachi Maxell, Ltd., the former parent of Battery Engineering, Inc. Our capitalization as adjusted gives effect to pro forma capitalization and the sale by us of 4,700,000 shares of common stock offered by this prospectus at an assumed initial public offering price of $16.00 per share and after deducting underwriting discounts and commissions and estimated offering expenses of $6.8 million payable by us and application of the net proceeds of this offering to repay a portion of our indebtedness as if this offering and the repayment of indebtedness had occurred on June 30, 2000. This table should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements and accompanying notes included elsewhere in this prospectus.

                                                                         (UNAUDITED)
                                                                     AS OF JUNE 30, 2000
                                                              ----------------------------------
                                                               ACTUAL    PRO FORMA   AS ADJUSTED
                                                                    (DOLLARS IN THOUSANDS)
Cash and cash equivalents (1)...............................  $  2,453   $  3,747     $   3,747
                                                              ========   ========     =========
Long-term debt:
  Credit facility:
    Term loans (2)..........................................  $102,700   $102,700     $  34,300
    Revolving credit facility (3)...........................     1,100      1,100         1,100
  Senior subordinated notes (4).............................    22,762     22,762        22,762
  Other (5).................................................        --      2,727         2,727
                                                              --------   --------     ---------
  Total long-term debt......................................   126,562    129,289        60,889
Stockholders' equity:
  Preferred stock $.001 par value, 100,000,000 shares
    authorized and none outstanding (actual); 100,000,000
    shares authorized and none outstanding (as adjusted)....
  Common stock $.001 par value; 100,000,000 shares
    authorized; 12,624,928 shares issued and 12,612,958
    shares outstanding (actual); 13,164,784 shares issued
    and 13,152,814 shares outstanding (pro forma);
    17,864,784 shares issued and 17,852,814 shares
    outstanding (as adjusted)...............................        12         13            18
  Capital in excess of par value............................    63,488     71,585       139,980
  Retained deficit..........................................   (17,760)   (17,760)      (18,826)(6)
  Treasury stock, at cost (11,970 shares, actual, pro forma
    and as adjusted)........................................      (179)      (179)         (179)
                                                              --------   --------     ---------
    Total stockholders' equity..............................    45,561     53,659       120,993
                                                              --------   --------     ---------
      Total capitalization..................................  $172,123   $182,948     $ 181,882
                                                              ========   ========     =========	

(1) The pro forma and as adjusted cash and cash equivalents excludes $2.8 million of cash received from Hitachi-Maxell, Ltd. related to the sale of 200,000 shares of our common stock. Such cash is restricted and is being maintained in an escrow account.
(2) Term loans on an actual basis include outstanding Term A loans of $43.8 million and Term B loans of $58.9 million. Term loans on an as adjusted basis includes outstanding Term A loans of $14.2 million and Term B loans of $20.1 million, or $9.7 million and $14.1 million if the underwriters exercise their over-allotment option in full, Term A loans and Term B loans, respectively.
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(3) At June 30, 2000, we had a maximum principal amount of $13.0 million, of which $11.9 million was available, under our revolving credit facility, subject to customary borrowing conditions. If we meet the debt to EBITDA ratio contained in our credit agreement, after December 31, 2000, the maximum availability under our revolving credit facility will increase to $20.0 million.
(4) $25.0 million of proceeds from the senior subordinated notes was initially allocated between $21.8 million of senior subordinated notes and $3.2 million of common stock issued to the holders of the senior subordinated notes. The difference between the principal amount of the notes and the amount allocated is being amortized using the effective yield method and is charged to interest expense over the term of the senior subordinated notes. The balance on an actual basis as of June 30, 2000 of $22.8 million includes $1.0 million of amortization of the discount on the notes.
(5) Represents outstanding debt assumed as part of our August 7, 2000 acquisition of Battery Engineering, Inc. This debt has a maturity date of December 2006. Interest is charged at a variable rate based on the bond market. The interest rate for 1999 was 4.35%.
(6) The as adjusted retained deficit includes an expense, net of tax, of $1.1 million as a result of the early extinguishment of indebtedness.
19

DILUTION
The pro forma net tangible book value of our common stock as of June 30, 2000 was $(56.1) million, or $(4.26) per share. Pro forma net tangible book value per share represents the amount of our total tangible assets, less the amount of our total liabilities, and then divided by the total number of shares of common stock outstanding. Dilution in pro forma net tangible book value per share represents the difference between the amount paid per share by purchasers of shares of common stock in this offering and the pro forma net tangible book value per share of common stock immediately after the completion of this offering. Such amounts give effect to our August 7, 2000 purchase of Battery Engineering, Inc. for 339,856 shares of common stock and assumption of approximately $2.7 million of indebtedness and our sale of 200,000 shares of common stock to the former parent of Battery Engineering, Inc. After giving effect to the sale of the 4,700,000 shares of common stock offered by us at an assumed initial public offering price of $16.00 per share, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us, our pro forma net tangible book value at June 30, 2000 would have been $12.8 million or $0.72 per share of common stock. This represents an immediate increase in pro forma net tangible book value of $4.98 per share to existing stockholders and an immediate dilution of $15.28 per share to new investors purchasing shares at the initial public offering price. The following table illustrates this dilution on a per share basis:

Assumed initial public offering price per share.............             $  16.00
  Pro forma net tangible book value per share as of June 30,
    2000....................................................  $  (4.26)
  Increase per share attributable to new investors..........      4.98
                                                              --------
Pro forma net tangible book value per share after the
  offering..................................................                  .72
                                                                         --------
Dilution per share to new investors.........................             $  15.28
                                                                         ========	

The following table summarizes, on a pro forma basis as of June 30, 2000, the differences between the existing stockholders and new investors with respect to the number of shares of common stock purchased from us, the total consideration paid to us and the average price per share paid (such amounts give effect to our August 7, 2000 purchase of Battery Engineering, Inc. for 339,856 shares of common stock and assumption of approximately $2.7 million of indebtedness and our sale of 200,000 shares of common stock to the former parent of Battery Engineering, Inc.):

                                   SHARES PURCHASED        TOTAL CONSIDERATION
                                 ---------------------   -----------------------   AVERAGE PRICE
                                   NUMBER     PERCENT       AMOUNT      PERCENT      PER SHARE
Existing stockholders..........  13,164,784     73.7%    $ 65,184,000      46.4%      $  4.95
New investors..................   4,700,000     26.3       75,200,000      53.6         16.00
                                 ----------     ----     ------------    ------
  Total........................  17,864,784    100.0%    $140,384,000     100.0%
                                 ==========     ====     ============    ======	

The foregoing table excludes 584,683 shares of common stock to be issued upon the exercise of options outstanding under our stock option plans as of August 15, 2000 at a weighted average price of $8.95 per share. If all of these outstanding options are exercised, the percentage of total shares purchased by new investors will be further diluted from 26.3% to 25.5%.
20

SELECTED CONSOLIDATED FINANCIAL DATA
The following table provides selected financial data of our company for the periods indicated. You should read the selected consolidated financial data set forth below in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations," and with our consolidated financial statements and related notes appearing elsewhere in this prospectus. The consolidated statement of operations data for the period from January 1, 1997 to July 10, 1997, the period from July 11, 1997 to January 2, 1998 and for the years ended January 1, 1999 and December 31, 1999, and the consolidated balance sheet data at January 1, 1999 and December 31, 1999 have been derived from our financial statements and related notes appearing elsewhere in this prospectus which have been audited by Deloitte & Touche LLP, independent auditors. The statement of operations data for the years ended December 31, 1995 and December 31, 1996 and the balance sheet data at December 31, 1995, December 31, 1996 and January 2, 1998 have been derived from our audited financial statements and related notes not included in this prospectus which have been audited by Deloitte & Touche LLP, independent auditors. The consolidated statement of operations data and cash flow data for the six months ended July 2, 1999 and June 30, 2000 and the consolidated balance sheet data at June 30, 2000 are unaudited but, in the opinion of management, include all adjustments, consisting of normal, recurring adjustments, necessary for a fair presentation of our results for these interim periods. The results of operations for the six months ended June 30, 2000 are not necessarily indicative of results to be expected for the entire year or for any period.

                                                     WILSON GREATBATCH LTD. (1)
                                              -----------------------------------------

                                              YEAR ENDED DECEMBER 31,   JANUARY 1, 1997
                                              -----------------------         TO
                                                 1995         1996       JULY 10, 1997
                                                (IN THOUSANDS, EXCEPT PER SHARE DATA)
CONSOLIDATED STATEMENT OF OPERATIONS DATA:
Total revenues..............................   $55,012      $51,390         $30,468
Cost of goods sold..........................    28,437       26,070          14,922
                                               -------      -------         -------
Gross profit................................    26,575       25,320          15,546
Selling, general and administrative.........    10,527       10,356           6,729
Research, development and engineering.......     7,033        7,951           4,400
Intangible amortization.....................        --           --              --
Transaction related expenses................        --           --          11,097
Write-off of purchased in-process research,
  development and engineering...............        --           --              --
                                               -------      -------         -------
                                                 9,015        7,013          (6,680)
Interest expense............................       506          388             252
Other.......................................      (196)        (124)           (117)
                                               -------      -------         -------
Income (loss) before income taxes...........     8,705        6,749          (6,815)
Income tax expense (benefit) (3)............       194          157           1,053
Cumulative effect of accounting change......        --           --              --
                                               -------      -------         -------
Net income (loss)...........................   $ 8,511      $ 6,592         $(7,868)
                                               =======      =======         =======

Net earnings (loss) per share (4):
  Basic.....................................   $   946      $   732         $  (874)
  Diluted...................................   $   946      $   732         $  (874)
Weighted average shares outstanding (4):
  Basic.....................................         9            9               9
  Diluted...................................         9            9               9

CONSOLIDATED CASH FLOW DATA:
Cash provided by operating
  activities................................
Cash used in investing activities...........
Cash provided by (used in) financing
  activities................................
EBITDA (5)(6)...............................

                                                             WILSON GREATBATCH TECHNOLOGIES, INC.
                                              -------------------------------------------------------------------
                                                                       YEAR ENDED             SIX MONTHS ENDED
                                               JULY 11, 1997    -------------------------   ---------------------
                                                    TO          JANUARY 1,   DECEMBER 31,    JULY 2,    JUNE 30,
                                              JANUARY 2, 1998    1999 (2)        1999         1999        2000
                                                             (IN THOUSANDS, EXCEPT PER SHARE DATA)
CONSOLIDATED STATEMENT OF OPERATIONS DATA:
Total revenues..............................      $ 27,193       $ 77,361      $ 79,235     $ 38,318    $ 46,584
Cost of goods sold..........................        12,241         36,454        41,057       19,385      26,385
                                                  --------       --------      --------     --------    --------
Gross profit................................        14,952         40,907        38,178       18,933      20,199
Selling, general and administrative.........         5,412         11,484         9,880        5,124       5,132
Research, development and engineering.......         4,619         12,190         9,339        5,130       5,046
Intangible amortization.....................         1,810          5,197         6,510        3,266       3,267
Transaction related expenses................            --             --            --           --          --
Write-off of purchased in-process research,
  development and engineering...............        23,779             --            --           --          --
                                                  --------       --------      --------     --------    --------
                                                   (20,668)        12,036        12,449        5,413       6,754
Interest expense............................         4,128         10,572        13,420        6,519       7,787
Other.......................................            74            364         1,343          129          71
                                                  --------       --------      --------     --------    --------
Income (loss) before income taxes...........       (24,870)         1,100        (2,314)      (1,235)     (1,104)
Income tax expense (benefit) (3)............        (9,468)           410          (605)        (321)       (328)
Cumulative effect of accounting change......            --             --          (563)        (563)         --
                                                  --------       --------      --------     --------    --------
Net income (loss)...........................      $(15,402)      $    690      $ (2,272)    $ (1,477)   $   (776)
                                                  ========       ========      ========     ========    ========
Net earnings (loss) per share (4):
  Basic.....................................      $  (1.74)      $   0.07      $  (0.18)    $  (0.12)   $  (0.06)
  Diluted...................................      $  (1.74)      $   0.06      $  (0.18)    $  (0.12)   $  (0.06)
Weighted average shares outstanding (4):
  Basic.....................................         8,855         10,461        12,491       12,406      12,615
  Diluted...................................         8,855         10,677        12,491       12,406      12,615
CONSOLIDATED CASH FLOW DATA:
Cash provided by operating
  activities................................      $  4,994       $  8,927      $  6,900     $  4,060    $  8,417
Cash used in investing activities...........        (3,653)       (83,375)       (8,847)      (3,882)     (3,507)
Cash provided by (used in) financing
  activities................................          (932)        76,269         1,670       (2,858)     (6,320)
EBITDA (5)(6)...............................       (17,345)        20,543        22,152       11,015      12,760	

21

                                                         WILSON GREATBATCH
                                                             LTD. (1)                WILSON GREATBATCH TECHNOLOGIES, INC.
                                                        -------------------   ---------------------------------------------------
                                                           DECEMBER 31,
                                                        -------------------   JANUARY 2,   JANUARY 1,   DECEMBER 31,    JUNE 30,
                                                          1995       1996        1998         1999          1999          2000
                                                                                     (IN THOUSANDS)
BALANCE SHEET DATA:
Cash and cash equivalents............................   $    42    $    54     $  2,319     $  4,140      $  3,863      $  2,453
Total assets.........................................    32,300     32,462     $111,709      194,390       189,779       184,361
Total debt...........................................     4,521      6,131       70,863      130,733       132,402       126,562
Total stockholders' equity...........................    16,316     16,914       28,239       45,595        46,407        45,561	

(1) The financial data for periods prior to July 11, 1997 relate to Wilson Greatbatch Ltd., our predecessor.
(2) In August 1998, we acquired the assets and liabilities of Hittman. These figures include the results of operatons of Hittman from August 8, 1998 to January 1, 1999.
(3) Wilson Greatbatch Ltd., our predecessor, incurred minimal state taxes as a former subchapter S corporation. The federal and state taxes for the period from January 1, 1997 to July 10, 1997 are directly attributable to our acquisition of our predecessor in July 1997.
(4) We calculate basic earnings per share by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. We calculate diluted earnings (loss) per share by adjusting for common stock equivalents, which consist of stock options. During the period from July 11, 1997 to January 2, 1998, the year ended December 31, 1999 and the six months ended July 2, 1999 and June 30, 2000, there were options to purchase 0, 246, 283 and 226 shares of common stock, respectively, that were not included in the computation of diluted earnings per share because to do so would be antidilutive for those periods. Diluted earnings per share for the year ended January 1, 1999 includes the potentially dilutive effect of stock options.
(5) When we refer to EBITDA, we mean net earnings or loss before interest expense, income taxes, depreciation and amortization. We have included EBITDA because our management and industry analysts generally consider it to be a measurement of the financial performance of our company that provides a relevant basis for comparison among companies. EBITDA is not a measurement of financial performance under accounting principles generally accepted in the United States and should not be considered a substitute for net income or loss as a measure of performance, or to cash flow as a measure of liquidity. Investors should note that this calculation of EBITDA might differ from similarly titled measures for other companies.
(6) EBITDA for the period July 11, 1997 to January 2, 1998 would have been $7.8 million if we had excluded the $23.8 million write-off of purchased in-process research, development and engineering related to the July 1997 leveraged buyout and $1.4 million of other transaction expenses.
22

MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
YOU SHOULD READ THE FOLLOWING DISCUSSION AND ANALYSIS OF OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS IN CONJUNCTION WITH OUR FINANCIAL STATEMENTS AND RELATED NOTES INCLUDED ELSEWHERE IN THIS PROSPECTUS. THIS DISCUSSION AND ANALYSIS CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS, UNCERTAINTIES AND ASSUMPTIONS. OUR ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF A NUMBER OF FACTORS, INCLUDING, BUT NOT LIMITED TO, THOSE SET FORTH UNDER "RISK FACTORS" AND ELSEWHERE IN THIS PROSPECTUS.
OVERVIEW
We are a leading developer and manufacturer of power sources and other components used in implantable medical devices, including wet tantalum capacitors and precision components. We leverage our core competencies in technology and manufacturing to develop and produce power sources for commercial applications that demand high performance and reliability. These applications include aerospace, oil and gas exploration and oceanographic equipment.
In July 1997, DLJ Merchant Banking and members of our management formed our company to acquire Wilson Greatbatch Ltd. from relatives of its founder, Mr. Wilson Greatbatch, in a leveraged buyout transaction. In the leveraged buyout transaction, DLJ Merchant Banking and its affiliates initially acquired approximately 86% of our outstanding common stock. In connection with the leveraged buyout, we issued $25.0 million principal amount of 13% senior subordinated notes, entered into a $10.0 million revolving line of credit and incurred $50.0 million of senior Term A and Term B loans. Affiliates of DLJ Merchant Banking originally purchased $22.5 million of the principal amount of the notes and led a syndicate of financial institutions in extending us the line of credit and term loans. In October 1997, an affiliate of DLJ Merchant Banking transferred $5.0 million of the principal amount of the notes to an affiliate of Merrill Lynch, Pierce, Fenner & Smith Incorporated. The leveraged buyout generated $82.9 million in intangible assets, of which approximately $6.1 million was allocated to goodwill. In connection with the leveraged buyout, we recorded a one time write-off of $23.8 million of purchased in-process research and development costs. A brief description follows of the more significant projects which comprise the 1997 purchased in-process research and development costs. Each description addresses the status as of the acquisition date and the current status of each project.
CAPACITORS
The objective of this project was to develop new capacitor technology to facilitate a significant reduction in the size of ICDs by significantly improving the energy density.
Capacitor project expenditures, at the time of the acquisition, totaled $2.6 million with additional expenditures of $2.0 million anticipated through completion of the project. We expected development efforts to be completed by mid-1998 and projected first year revenues of $1.4 million. We deemed the technical risks associated with this project to be moderate, as the technology was similar to our battery technology, and the commercialization risks we viewed as low, since we were working with the same customers as for our battery business.
Development efforts for the first generation capacitors continued through the third quarter of 1999. Revenues in 1999 were $2.3 million. Total development costs through the end of 1999 (including operating losses as this project transitioned to product line status) were $10.8 million. In addition, approximately $8.2 million in capital expenditures have been incurred. The revisions of our original timeline and cost estimates resulted from the difficulty in manufacturing capacitors to customer specifications, which became more stringent than those originally envisioned.
23

NEXT GENERATION ICD
The objective of this project was to develop several proprietary process improvements to reduce the size of the ICD battery, while at the same time delivering more energy density than the products sold at the time.
At the date of the acquisition, $0.1 million had been expended on this project with additional expenditures of $0.4 million anticipated through completion. We expected development efforts to be completed by the end of 1997. First year revenues of $6.4 million were projected to begin in 1998. We deemed the technical and commercialization risks to be low since the technology, end-user applications and customer base were familiar to us.
Development efforts were completed by December 1997 with a total cost of $0.5 million. First year revenues were $6.4 million.
GREATBATCH SCIENTIFIC
The objective of this project was the development of battery-powered surgical devices which were magnetic resonance imaging, or MRI, compatible, in order to develop a new product line, a new customer base and a new outlet for our already-existing batteries.
At the time of the acquisition, we had expended $2.0 million on this project with additional expenditures of $1.7 million anticipated through completion. We expected to ship the first instruments in the third quarter of 1998. First year revenues of $4.6 million were projected to begin in 1998. We viewed the technical risk as moderate, as we had not produced a wide variety of surgical devices, and the commercialization risk as high. We intended to outsource much of the production and to initiate distribution to a completely new customer base.
In order to focus our efforts on integrating the Hittman acquisition and bringing our capacitor project into full production, we sold the Greatbatch Scientific operation to an unrelated medical device company in August 1998 in exchange for stock of the acquiror. Greatbatch Scientific had no further impact on our sales or operating costs after August 1998.
Sales from July 1997 through August 1998 were less than $0.1 million.
LITHIUM ION PRODUCTS
The objective of this project was to develop and manufacture rechargeable lithium ion batteries suitable for use in implantable medical devices.
At the time of the acquisition, $0.5 million had been expended on this project, which was expected to be completed by the end of 1997. First year revenues of $0.9 million were projected to begin in 1998. We viewed the technical risk as moderate as we had not previously developed multi-use batteries. We viewed commercialization risk as moderate because we would be targeting a new customer base.
We completed development efforts on the first generation of rechargeable lithium ion cell in the second quarter of 2000. Sales revenue has not yet begun. However, non-refundable engineering fees, which are recorded as an offset to development expenses, have approximated $1.9 million since the acquisition. Development costs since the acquisition have totaled $4.6 million. We have revised our original timelines and cost estimates due to delays in the development phase of this project. Some of the customers for this project are themselves development-stage enterprises.
In August 1998, we acquired Hittman, a medical components manufacturer, for $71.8 million. At the time of the of acquisition, we paid $69.0 million. A portion of the consideration was contingent upon Hittman achieving financial targets after the acquisition. Some of these targets were achieved in 1998 and we subsequently paid $2.8 million to the former owner of Hittman. In connection with our
24

acquisition of Hittman, we borrowed an additional $60.0 million of Term A and Term B loans and increased our revolving line of credit up to a maximum of $20.0 million. We recorded the Hittman acquisition using the purchase method of accounting. The excess of the purchase price over the fair value of the net assets that we acquired was $67.7 million, of which $17.4 million was allocated to identifiable intangible assets and $50.3 million was allocated to goodwill. Sales by Hittman of $8.8 million are reflected in our 1998 results.
Our fiscal year ends on the closest Friday to December 31. Accordingly, our fiscal year will periodically contain more or less than 365 days. For example, fiscal 1997 ended on January 2, 1998 and fiscal 1998 ended on January 1, 1999. Our fiscal quarters are three-month periods that end on the Friday closest to the end of the applicable calendar quarter.
REVENUE AND EXPENSE COMPONENTS
REVENUES
We derive revenues from the sale of medical and commercial products. Our medical revenues consist of sales of implantable power sources, capacitors and components. Our commercial revenues consist of sales of commercial power sources. A substantial part of our business is conducted with a limited number of customers. Guidant accounted for approximately 33% of our revenues and St. Jude Medical accounted for approximately 31% of our revenues in 1999. We have entered into long term supply agreements ranging from two to ten years with most of our large customers.
Our implantable power source revenues are derived from sales of batteries for pacemakers, ICDs and other implantable medical devices. The majority of our implantable power source customers contract with us to develop custom batteries to fit their product specifications. We are the sole provider of these products to many of our customers. We also record royalties as implantable power source revenues. These revenues are recognized based on the reported number of units sold. Since January 2, 1998, royalties have accounted for approximately 2.7% to 3.3% of our aggregate annual revenues. Currently, Medtronic is our sole source of royalty fees. Although our license agreement with Medtronic itself has no termination date, the patents from which we receive royalty payments from Medtronic expire in all material respects in 2000. Thereafter, in the absence of new patents, we do not expect to receive any royalties to record as implantable power source revenues.
Our capacitor revenues are derived from sales of our wet tantalum capacitors, which we developed for use in ICDs. In 1999 and the first six months of 2000, we incurred start-up costs related to our capacitor operations of $5.7 million. We believe that this amount will represent substantially all of our start-up costs. We began selling our new wet tantalum capacitors commercially in the fourth quarter of 1999. We expect to enter into long term agreements of more than one year with our capacitor customers and add new customers in an effort to increase our capacitor revenues. Although there can be no assurance, we believe that our revenues in 2000 and 2001 from capacitor sales will grow at a higher rate than sales of our other medical products and that our capacitor program will become profitable in 2001.
Our components revenues are derived from sales of feedthroughs, electrodes and other precision components principally used in pacemakers and ICDs. We also sell our components for use in other implantable medical devices, such as left ventricular assist devices, hearing assist devices, drug pumps, neurostimulators and other medical applications.
Our commercial power source revenues are primarily derived from sales of batteries for use in oil and gas exploration, including recovery equipment, pipeline inspection gauges, down-hole pressure measurement systems and seismic surveying equipment. We also supply batteries to NASA for its space shuttle program and other demanding commercial applications.
25

For each of our products, we recognize revenue when the products are shipped. We do not give warranties to our customers for our products and to date, returns have been immaterial. In addition to product and royalty revenues, we also receive cash flows from cost reimbursements for research, development and engineering conducted on behalf of some of our customers. We record these cost reimbursements as an offset to research, development and engineering costs. We recognize cost reimbursements upon achieving related milestones. The cost reimbursement charged to customers represents actual costs incurred by us in the design and testing of prototypes built to customer specifications. This cost reimbursement does not include a mark-up. Price concessions have not significantly affected revenues in the historical periods presented.
EXPENSES
Cost of goods sold includes materials, labor and other manufacturing costs associated with the products we sell. We have included start-up costs associated with the production of our capacitors in cost of goods sold. As a result, costs associated with capacitors prior to the fourth quarter of 1999, when we began to commercially offer these products, were substantially in excess of revenue generated from capacitor sales.
Selling, general and administrative expenses include salaries, facility costs and patent-related expenses.
Research, development and engineering expenses include costs associated with the design, development, testing, deployment and enhancement of our products. We record cost reimbursements as an offset to research, development and engineering expenses.
Other expenses primarily include amortization of intangible assets and interest expense. Amortization of intangible assets is primarily related to the leveraged buyout and our acquisition of Hittman. Interest expense is primarily related to indebtedness we assumed in connection with these transactions. We expect to use the proceeds of this offering to repay a portion of our outstanding Term A and Term B loans.
26

RESULTS OF OPERATIONS
The following table sets forth, for the periods indicated, the percentage which the listed amounts bear to total revenues:

                                                                                                      FIRST SIX
                                                                        FISCAL YEAR                   MONTHS OF
                                                              --------------------------------   -------------------
                                                              PRO FORMA
                                                               1997 (1)      1998       1999       1999       2000
Revenues:
  Implantable power sources.................................     69.7%       65.1%      51.1%      50.8%      44.1%
  Capacitors................................................      0.0         0.1        2.9        2.6       14.8
  Medical components........................................      9.9        18.1       33.4       33.6       30.7
                                                                -----       -----      -----      -----      -----
    Total medical revenues..................................     79.6        83.3       87.4       87.0       89.6
  Commercial power sources..................................     20.4        16.7       12.6       13.0       10.4
                                                                -----       -----      -----      -----      -----
    Total revenues..........................................    100.0%      100.0%     100.0%     100.0%     100.0%
                                                                =====       =====      =====      =====      =====

Income statement data as a percentage of revenues:
  Gross profit..............................................     52.9%       52.9%      48.2%      49.4%      43.3%

  Net income (loss).........................................      4.0         0.9       (2.9)      (3.8)      (1.7)

  EBITDA(2).................................................     21.4%       26.6%      28.0%      28.7%      27.4%	

(1) The unaudited pro forma data for fiscal 1997 gives effect to the July 1997 leveraged buyout as if it had occurred on January 1, 1997.
(2) When we refer to EBITDA, we mean net earnings or loss before interest expense, income taxes, depreciation and amortization. We have included EBITDA because our management and industry analysts generally consider it to be a measurement of the financial performance of our company that provides a relevant basis for comparison among companies. EBITDA is not a measurement of financial performance under accounting principles generally accepted in the United States and should not be considered a substitute for net income or loss as a measure of performance, or to cash flow as a measure of liquidity. Investors should note that this calculation of EBITDA might differ from similarly titled measures for other companies.
FIRST SIX MONTHS OF 2000 COMPARED TO FIRST SIX MONTHS OF 1999
REVENUES
Total revenues for the first six months of 2000 were $46.6 million, an $8.3 million, or 22%, increase from $38.3 million for the first six months of 1999. Implantable power source revenues for the first six months of 2000 were $20.5 million, a $1.0 million, or 5%, increase from $19.5 million for the first six months of 1999. This increase was primarily due to higher pacemaker battery sales as a result of an increase in pacemaker sales by our customers, including, in particular, a European device manufacturer receiving a large order from a national health agency. This increase was partially offset due to an industry-wide design change in ICDs that resulted in ICDs using one battery instead of two. Capacitor revenues for the first six months of 2000 were $6.9 million, a $5.9 million, or 605%, increase from $1.0 million for the first six months of 1999. This increase was primarily due to initial commercial sales of our new wet tantalum capacitors beginning in the fourth quarter of 1999. Medical components revenues for the first six months of 2000 were $14.3 million, a $1.4 million, or 11%, increase from $12.9 million for the first six months of 1999. This increase was primarily due to the sale of a greater number of implantable medical devices by our customers, as well as our sales of a broader range of components. Commercial power source revenues for the first six months of 2000 were $4.8 million, a $0.1 million, or 3%, decrease from $5.0 million for the first six months of 1999. This decrease was primarily due to continued weakness in the oil and gas industry.
27

GROSS PROFIT
Gross profit for the first six months of 2000 was $20.2 million, a $1.3 million, or 7%, increase from $18.9 million for the first six months of 1999. As a percentage of total revenues, gross profit for the first six months of 2000 declined to 43% from 49% for the first six months of 1999. This decrease was primarily due to a lower percentage of total revenues from established product lines such as power sources, with no accompanying start-up costs, versus a higher percentage of total revenues from newer products, with accompanying high start-up costs, such as capacitors. Increased costs incurred with respect to our capacitor line decreased gross profit by $0.2 million, despite a $5.9 million increase in sales. The decrease in gross profit attributable to the decrease in commercial power source revenues was $0.1 million. These decreases were more than offset by increases in gross profit of $0.7 million from increased implantable power sources revenues and $0.9 million from increased sales of medical components.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses for the first six months of 2000 were $5.1 million, the same as for the first six months of 1999. As a percentage of total revenues, selling, general and administrative expenses for the first six months of 2000 declined to 11% from 13% for the first six months of 1999. This decrease was primarily due to an increase in revenues attributable to capacitor sales and several actions taken to streamline expenses, the most significant of which was a reduction in discretionary operating expenses, including professional fees, consulting fees and travel expenses.
RESEARCH, DEVELOPMENT AND ENGINEERING EXPENSES
Research, development and engineering expenses for the first six months of 2000 were $5.0 million, a $0.1 million, or 2%, decrease from $5.1 million for the first six months of 1999. As a percentage of total revenues, research, development and engineering expenses for the first six months of 2000 declined to 11% from 13% for the first six months of 1999. This decrease was primarily due to an increase in revenues attributable to capacitor sales, an increase in non-refundable engineering fees, which are an offset to research, development and engineering expenses, and our efforts to curtail operating expenses, such as lower depreciation charges due to reduced capital expenditures, materials used in research and development projects and travel. This cost containment did not impact the funding of programs that we believed to be important to our future growth.
OTHER OPERATING EXPENSES
Intangible amortization was $3.3 million for both the six months ended June 30, 2000 and the six months ended July 2, 1999. Interest expense for the six months ended June 30, 2000 was $7.8 million, an increase of $1.3 million, or 19%, from $6.5 million for the six months ended July 2, 1999. This increase was primarily due to higher interest rates.
PROVISION FOR INCOME TAXES
Our effective tax rate increased to 30% for the first six months of 2000 from 26% for the first six months of 1999. This increase was primarily due to the decrease in state tax credits available to us for the first six months of 2000 compared to the first six months of 1999.
NET LOSS
As a result of the reasons described above, as well as the nonrecurring cumulative effect of an accounting change which resulted in a charge of $0.6 million, net of taxes, the net loss for the first six
28

months of 2000 was $0.8 million, a $0.7 million decrease from the net loss of $1.5 million for the first six months of 1999.
FISCAL 1999 COMPARED TO FISCAL 1998
REVENUES
Total revenues for 1999 were $79.2 million, a $1.9 million, or 2%, increase from $77.4 million for 1998. Implantable power source revenues for 1999 were $40.5 million, a $9.9 million, or 20%, decrease from $50.3 million for 1998. This decrease was primarily due to a 1999 industry-wide design change in ICDs that reduced the number of batteries from two to one and the loss of market share by our ICD battery customers as a result of the introduction of a new ICD by Medtronic. Medtronic manufactured its own power sources for this ICD. This decrease was also due to a reduction in pacemaker battery demand resulting from Guidant's acquisition and subsequent closure of operations of Sulzer Intermedics, which previously purchased batteries from us. This decrease was partially offset by the successful launch of a new pacemaker by one of our customers and increased demand and orders from one of our customers that secured a government contract for pacemakers. Capacitor revenues for 1999 were $2.3 million, a $2.2 million increase from $0.1 million for 1998. This increase resulted primarily because we began selling our new wet tantalum capacitors commercially in the fourth quarter of 1999. Medical components revenues for 1999 were $26.4 million, a $12.4 million, or 89%, increase from $14.0 million for 1998. This increase was primarily due to the inclusion of a full year of operations from our Hittman acquisition and the sale of a greater number of implantable medical devices by our customers. Commercial power source revenues for 1999 were $10.0 million, a $2.9 million, or 22%, decrease from $12.9 million for 1998. This decrease was primarily due to continued weakness in the oil and gas industry.
GROSS PROFIT
Gross profit for 1999 was $38.2 million, a $2.7 million, or 7%, decrease from $40.9 million for 1998. As a percentage of revenues, gross profit for 1999 declined to 48% from 53% in 1998. The decrease in implantable power source gross profit amounted to 9% of revenue, while capacitor start-up costs totaled 6% of revenue.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses for 1999 were $9.9 million, a $1.6 million, or 14%, decrease from $11.5 million for 1998. As a percentage of revenues, selling, general and administrative expenses for 1999 declined to 12% from 15% in 1998. These decreases were due to a temporary reduction in salaries, the deferral of annual merit increases, a reduction in incentive compensation, a general cutback in discretionary expenses and a reduction in the number of our employees.
The temporary reduction in salaries was in effect from April 1999 through December 1999 and reduced selling, general and administrative expenses by $0.3 million in 1999. The reduction in incentive compensation, including both management bonuses and broad-based profit sharing, reduced expenses by $1.0 million compared to 1998. Discretionary expenses in 1999 were $0.3 million lower than in 1998. Three employees accounted for in selling, general and administrative expenses were terminated as part of the 1999 cost reductions, with total cost savings of less than $0.1 million, net of severance benefits.
RESEARCH, DEVELOPMENT AND ENGINEERING EXPENSES
Research, development and engineering expenses for 1999 were $9.3 million, a $2.9 million, or 23%, decrease from $12.2 million for 1998. As a percentage of total revenues, research, development and engineering expenses in 1999 declined to 12% from 16% in 1998. Beginning in 1999, as we
29

anticipated achieving production volumes of our capacitors, we accounted for costs associated with our capacitor program as cost of goods sold, selling, general and administrative expenses and research, development and engineering expenses. In prior years, these costs were recognized only as research, development and engineering expenses. This had the effect of lowering research, development and engineering expenses in 1999 by $1.4 million as compared to 1998. In addition, in 1999, we had no research, development and engineering expenses for Greatbatch Scientific, one of our product lines, which we sold in 1998. The amount of the decrease in research, development and engineering expenses resulting from the sale of Greatbatch Scientific was $0.8 million. Greatbatch Scientific was a developer of battery-powered surgical tools that were magnetic resonance imaging, or MRI, compatible and incurred $0.8 million in research, development and engineering expenses in 1998.
Costs were also reduced in 1999 for the same programs as were discussed above under the caption "--Selling, general and administrative expenses." The temporary reduction in salaries reduced costs in 1999 by $0.3 million. The reduction in incentive compensation reduced expenses by $0.6 million. Four employees accounted for in research, development and engineering expenses were terminated as part of the 1999 cost reductions, with total cost savings of $0.1 million, net of severance benefits. Non-refundable engineering fees, which serve to offset expenses, declined by $0.3 million in 1999 compared to 1998.
OTHER OPERATING EXPENSES
Intangible amortization expense for 1999 was $6.5 million, an increase of $1.3 million, or 25%, from $5.2 million in 1998. This increase was primarily due to incurring a full year of amortization of intangible assets associated with the Hittman acquisition in 1998. Interest expense for 1998 was $13.4 million in 1999, an increase of $2.8 million, or 27%, from $10.6 million in 1998. This increase was due to the combination of a full year of interest expense in 1999 related to the 1998 acquisition of Hittman and higher interest rates in 1999 as compared to 1998. Other expense was $1.3 million in 1999, an increase of $0.9 million from $0.4 million in 1998. The increase resulted primarily from a write down of our investment in an unaffiliated company that we acquired in conjunction with our sale of Greatbatch Scientific.
PROVISION FOR INCOME TAXES
Our effective tax rate declined to 26% in 1999 from 37% in 1998. Our recapture of federal alternative minimum tax credits at a 20% tax rate resulted in a rate differential of 15% from the federal statutory rate. We also benefited from state tax credits.
NET INCOME (LOSS)
Net loss was $2.3 million for 1999, a $3.0 million decrease from net income of $0.7 million for 1998. This decrease was primarily due to an increase in cost of goods sold and higher other expenses, as described above, as well as the nonrecurring cumulative effect of an accounting change which resulted in a charge of $0.6 million, net of taxes.
FISCAL 1998 COMPARED TO FISCAL 1997
The following table summarizes consolidated statement of operations data for Wilson Greatbatch Ltd. for the period from January 1, 1997 to July 10, 1997 and for Wilson Greatbatch Technologies, Inc. for the period from July 11, 1997 to January 2, 1998 and, fiscal 1998 and unaudited pro forma fiscal 1997 as if the July 1997 leveraged buyout had occurred on January 1, 1997. These pro forma amounts were derived by combining financial data from the audited historical financial statements of both Wilson Greatbatch Ltd. and Wilson Greatbatch Technologies, Inc. for fiscal 1997. Pro forma 1997 data
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excludes a $23.8 million write-off of in-process research, development and engineering expense and $11.1 million of transaction related expenses associated with the leveraged buyout. In addition, pro forma 1997 data reflects additional interest of $3.9 million and amortization of $1.8 million incurred in connection with the leveraged buyout. Income tax benefit was calculated at a statutory rate of 38%.

                                                                     WILSON GREATBATCH TECHNOLOGIES, INC.
                                         WILSON GREATBATCH LTD.   -------------------------------------------
                                            JANUARY 1, 1997        JULY 11, 1997
                                                   TO                   TO           PRO FORMA
                                             JULY 10, 1997        JANUARY 2, 1998   FISCAL 1997   FISCAL 1998
                                         ----------------------   ---------------   -----------   -----------
                                                                  (IN THOUSANDS)
CONSOLIDATED STATEMENT OF OPERATIONS
  DATA:
Total revenues.........................         $ 30,468              $ 27,193        $ 57,661      $ 77,361
Cost of goods sold.....................           14,922                12,241          27,163        36,454
                                                --------              --------        --------      --------
Gross profit...........................           15,546                14,952          30,498        40,907
Selling, general and administrative
  expenses.............................            6,729                 5,412          12,141        11,484
Research, development and engineering
  expenses.............................            4,400                 4,619           9,019        12,190
Intangible amortization................               --                 1,810           3,620         5,197
Transaction related expenses...........           11,097                    --              --            --
Write-off of purchased in-process
  research, development and engineering
  costs, net...........................               --                23,779              --            --
                                                --------              --------        --------      --------
                                                  (6,680)              (20,668)          5,718        12,036
Interest expense.......................              252                 4,128           8,256        10,572
Other..................................             (117)                   74              --           364
                                                --------              --------        --------      --------
Income (loss) before income taxes......           (6,815)              (24,870)         (2,538)        1,100
Income tax expense (benefit)...........            1,053                (9,468)           (964)          410
                                                --------              --------        --------      --------
Net income (loss)......................         $ (7,868)             $(15,402)       $ (1,574)     $    690
                                                ========              ========        ========      ========
EBITDA (1).............................              N/A              $(17,345)         12,346      $ 20,543
                                                ========              ========        ========      ========	

(1) When we refer to EBITDA, we mean net earnings or loss before interest expense, income taxes, depreciation and amortization. We have included EBITDA because our management and industry analysts generally consider it to be a measurement of the financial performance of our company that provides a relevant basis for comparison among companies. EBITDA is not a measurement of financial performance under accounting principles generally accepted in the United States and should not be considered a substitute for net income or loss as a measure of performance, or to cash flow as a measure of liquidity. Investors should note that this calculation of EBITDA might differ from similarly titled measures for other companies.
The following analysis compares historical fiscal 1998 results to the combined historical fiscal 1997 amounts for revenues, gross profit, selling, general and administrative expenses and research, development and engineering expenses. The results of the combined 1997 historical amounts include no pro forma adjustments. Other expenses, provision for income taxes and net income
(loss) compares historical fiscal 1998 to the period from July 11, 1997 to January 2, 1998, and compares the July 11, 1997 to January 2, 1998 historical data to the January 1, 1997 to July 10, 1997 historical data.
REVENUES
Total revenues for 1998 were $77.4 million, a $19.7 million, or 34%, increase from $57.7 million for 1997. Implantable power source revenues for 1998 were $50.3 million, a $10.1 million, or 25%, increase from $40.2 million for 1997. This increase was primarily due to increased sales of implantable power sources due to the introduction of a new generation of ICDs by our customers. Medical components revenues for 1998 were $14.0 million, an $8.3 million, or 145%, increase from $5.7 million for 1997. This increase was primarily due to the inclusion of results of operations from our Hittman acquisition beginning in August 1998. Commercial power source revenues for 1998 were $12.9 million, a
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$1.1 million, or 10%, increase from $11.8 million for 1997. This increase was primarily due to increased demand for our products for pipeline inspection gauges and measurement while drilling equipment.
GROSS PROFIT
Gross profit for 1998 was $40.9 million, a $10.4 million, or 34%, increase from $30.5 million for 1997. As a percentage of total revenues, gross profit was 53% in both 1998 and 1997.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses for 1998 were $11.5 million, a $0.6 million, or 5%, decrease from $12.1 million for 1997. As a percentage of total revenues, selling, general and administrative expenses in 1998 decreased to 15% from 21% in 1997. These decreases were primarily due to a reduction in corporate office costs and the inclusion of a partial year of Greatbatch Scientific's selling, general and administrative expenses in 1998 compared to a full year of those expenses in 1997.
RESEARCH, DEVELOPMENT AND ENGINEERING EXPENSES
Research, development and engineering expenses for 1998 were $12.2 million, a $3.2 million, or 35%, increase from $9.0 million for 1997. This increase was primarily due to start-up expenses incurred in establishing our line of capacitor products. As a percentage of total revenues, research, development and engineering expenses were 16% for both periods.
OTHER OPERATING EXPENSES
Intangible amortization for 1998 was $5.2 million, a $1.6 million, or 44%, increase from $3.6 million in 1997. This increase was primarily due to incurring a full year of amortization of intangible assets in 1998 related to the July 1997 leveraged buyout and also related to additional amortization of intangible assets as a result of the Hittman acquisition in 1998.
Transaction related expenses of $11.1 million were incurred by our predecessor, Wilson Greatbatch Ltd. These nonrecurring costs were recognized by Wilson Greatbatch Ltd. for the period from January 1, 1997 to July 10, 1997.
The write-off of purchased in-process research, development and engineering costs of $23.8 million were incurred by the Company as a result of the 1997 leveraged buyout. These nonrecurring costs were immediately charged to expense upon acquisition and recognized in the period from July 11, 1997 to January 2, 1998.
Interest expense for 1998 was $10.6 million, a $2.3 million, or 28%, increase from $8.3 million in 1997. This increase was primarily due to incurring a full year of interest expense in 1998 related to the July 1997 leveraged buyout and also related to additional debt being incurred as a result of the Hittman acquisition in 1998.
PROVISION FOR INCOME TAXES
Our effective tax rate for 1998 was 37%, or a 1% decrease from 38% for the period from July 11, 1997 to January 2, 1998. Our effective tax rate for both periods approximated the combined federal and state statutory rates. The federal and state taxes for the period from January 1, 1997 to July 10, 1997 are directly attributable to the acquisition of Wilson Greatbatch Ltd., which incurred only minimal state taxes as a former subchapter S corporation.
NET INCOME (LOSS)
Net income was $0.7 million for 1998, a $16.1 million increase over a net loss of $15.4 million for the period from July 11, 1997 to January 2, 1998. This increase in net income in 1998 was primarily attributable to a full year of operating results, increased gross profit and the absence of any write-off of purchased in-process research, development and engineering. Net loss was $15.4 million for the period from July 11, 1997 to January 2, 1998, a $7.5 million increase from a net loss of $7.9 million for the
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period from January 1, 1997 to July 10, 1997. This increase in net loss for the period from July 11, 1997 to January 2, 1998 was primarily attributable to the absence of significant interest expense, amortization expense and the write-off of purchased in-process research, development and engineering costs in the period January 1, 1997 to July 10, 1997.
LIQUIDITY AND CAPITAL RESOURCES
Since inception, we have funded our operations primarily from cash generated by our operations. We have financed our acquisitions, including the July 1997 leveraged buyout, through a combination of borrowings and private sales of our common stock. Net proceeds from financing activities from January 1, 1997 through June 30, 2000 included:
- In connection with the LBO, in July 1997 we issued $25.0 million principal amount of 13% senior subordinated notes, entered into a $10.0 million revolving line of credit and incurred $50.0 million of senior Term A and Term B loans. Net proceeds from these borrowings totaled $71.8 million. We also received a $45.3 million equity investment from DLJ Merchant Banking, various members of our senior management and other investors.
- In connection with our August 1998 acquisition of Hittman, we borrowed an additional $60.0 million of Term A and Term B loans and increased our revolving line of credit up to a maximum of $20.0 million. We also received a $16.5 million equity investment from DLJ Merchant Banking, various members of our senior management and other investors.
As of July 1, 2000, there was $25.0 million principal amount outstanding under our 13% senior subordinated notes, $43.8 million outstanding under the Term A loan facility and $58.9 million outstanding under the Term B loan facility. As of July 1, 2000, the interest rate for our Term A loans was 10.31% and the interest rate for our Term B loans was 10.15%.
Our revolving line of credit is with the same lending syndicate that provided financing for the Hittman transaction and allows us to borrow up to $13.0 million. If we meet our financial targets, including the debt to EBITDA ratio set forth in our credit agreement, the maximum availability will increase after December 31, 2000 to $20.0 million. The line of credit bears interest at prime plus 2.25% or LIBOR plus 3.5%, at our option, and expires on September 30, 2004. As of July 1, 2000, $1.1 million was outstanding under this line of credit and the effective rate was 11.75%. The line of credit is secured by our accounts receivable and inventories and requires us to comply with various quarterly financial covenants, including covenants related to EBITDA and ratios of leverage, interest and fixed charges as they relate to EBITDA. We have failed to fully comply with the financial covenants required by our line of credit. In November 1999, we entered into a waiver and amendment with our lenders which, among other things, waived our non-compliance with financial covenants contained in the credit agreement. In February 2000, our credit agreement was again amended to change provisions governing the applicable interest rates and financial covenants. At July 1, 2000, we were in full compliance with the financial covenants under the line of credit.
In August 1998, we sold the assets of one of our product lines, Greatbatch Scientific, to a third party in exchange for stock of that company valued at $2.4 million. Our 1998 results reflect revenues of $0.1 million and an operating loss of $1.3 million from Greatbatch Scientific's operations. In 1997, when we accounted for Greatbatch Scientific as a business development program, our total costs were $3.2 million.
As of June 30, 2000, we had cash and cash equivalents of $2.5 million. We have historically generated positive cash flow from operations. Cash generated by operating activities for the six months ended June 30, 2000 was $8.4 million as compared to $4.1 million for the six months ended July 2, 1999. Cash was positively impacted in the six month period of 2000 by the receipt of state tax credits and lower incentive compensation payments relative to the first six months of 1999. Additionally, cash was positively impacted in 2000 by a restructuring of LIBOR contracts to avoid an increase in interest rates brought on by Year 2000 concerns. This had the effect of increasing cash interest payments in the
33

fourth quarter of 1999 and lowering cash interest payments in the first quarter of 2000. Cash generated by operating activities was $6.9 million in 1999 and $8.9 million in 1998 and cash used in operating activities was $0.6 million in 1997. Cash generated by operating activities in 1999 was positively impacted by lower incentive compensation payments and interest payments compared to payments made in 1998. Cash generated by operating activities in 1998 was negatively impacted by an increase in accounts receivable in 1998, almost completely offset by higher incentive compensation and interest accruals in 1998 versus 1997.
Cash used in investing activities was $3.5 million and $3.9 million for the six months ended June 30, 2000 and July 2, 1999, respectively. Capital expenditures were $3.2 million and $3.6 million for the six months ended June 30, 2000 and July 2, 1999, respectively.
Cash used in investing activities was $8.8 million, $83.4 million and $5.6 million in 1999, 1998 and 1997, respectively. The large increase in 1998 was attributable to our acquisition of Hittman. Capital expenditures were $8.5 million, $6.2 million and $4.6 million in 1999, 1998 and 1997, respectively.
Cash used in financing activities was $6.3 million and $2.9 million for the six months ended June 30, 2000 and July 2, 1999, respectively. Repayments of borrowings under our line of credit and prepayments or repayments of regularly-scheduled long-term debt payments were $6.3 million and $3.0 million for the six months ended June 30, 2000 and July 2, 1999, respectively.
Cash provided by financing activities was $1.7 million, $76.3 million and $6.9 million in 1999, 1998 and 1997, respectively. The increases and decreases in net cash provided by financing activities during these periods were attributable to our acquisition of Hittman.
We expect to incur capital expenditures of approximately $6.6 million in 2000, $2.8 million of which we anticipate will be used for continued development of our capacitor product line and $3.8 million of which we anticipate will be used for routine recurring capital expense obligations. As of July 1, 2000, we had incurred $3.2 million of capital expenditures in 2000. We intend to use the proceeds of this offering to repay a portion of our Term A and Term B loans. Although it is difficult for us to predict future liquidity requirements, we believe that our existing cash balances and cash equivalents and cash from operations will be sufficient to finance our operations and planned capital expenditures for the next two years. Thereafter, we may require additional funds to support our working capital requirements or for other purposes and may seek additional funds through public or private equity or debt financing or from other sources. There can be no assurance that additional financing will be available to us or, if available, that it can be obtained on a timely basis or on terms acceptable to us.
INFLATION
We do not believe that inflation has had a significant effect on our operations to date.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Our major market risk exposure is to changing interest rates. Our policy is to manage interest rates through a combination of variable rate debt and through use of interest rate cap agreements to manage our exposure to fluctuations in interest rates. As of July 1, 2000, 82% of our long-term debt consisted of variable rate instruments that accrue interest at floating rates. As of July 1, 2000, through interest rate cap agreements, we had capped our interest rate exposure at 7.0% on $24.1 million of floating rate debt through December 2000 and at 6.0% on $55.0 million of floating rate debt through January 2002. We do not use foreign currency forward contracts and do not have any material foreign currency exposure. In order to minimize our foreign exchange risk, all of our sales are made in U.S. dollars. We do not hedge against price fluctuation in the commodities used in the manufacturing of our products. We will reevaluate this policy as needed commensurate with the risks inherent in our business.
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NEW ACCOUNTING PRONOUNCEMENTS
In 1999, we adopted AICPA Statement of Position 98-5, "Reporting the Costs of Start-Up Activities," an accounting standard which required that organization and other start-up costs that we capitalized prior to January 2, 1999 be written off and any future start-up costs be expensed as incurred. In accordance with this statement, in 1999 we wrote off $0.6 million, net of tax, of start-up costs that had been deferred in conjunction with the July 1997 leveraged buyout and our acquisition of Hittman's assets and liabilities in August 1998.
In 2001, we plan to adopt Statement of Financial Accounting Standards No. 133, "Accounting for Derivatives Instruments and Hedging Activities." This standard will require us to recognize all derivative financial instruments on our balance sheet at fair value with changes in fair value recorded to the statement of operations or comprehensive income, depending on the nature of the investment. Because our interest rate cap agreements are our only derivative financial instruments, we do not expect the adoption of the standard to have a material effect on our financial statements.
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BUSINESS
OVERVIEW
We are a leading developer and manufacturer of power sources and other components used in implantable medical devices, including wet tantalum capacitors and precision components, and a preferred supplier of power sources and components. We offer technologically advanced, highly reliable and long lasting products for implantable medical devices and enable our customers to introduce implantable medical devices that are progressively smaller, longer lasting, more efficient and more functional. We leverage our core competencies in technology and manufacturing to develop and produce power sources for commercial applications that demand high performance and reliability, including aerospace, oil and gas exploration and oceanographic equipment. Our customers utilize our specially designed, proprietary power sources and components in their products. We believe that our proprietary technology, close customer relationships, market leadership and dedication to quality provide us with significant competitive advantages over our competitors and create a barrier to entry for potential market entrants.
Mr. Wilson Greatbatch patented the implantable pacemaker in 1962. In 1970, Mr. Greatbatch founded Wilson Greatbatch Ltd., our predecessor. In July 1997, DLJ Merchant Banking led a leveraged buyout of Wilson Greatbatch Ltd. Our company was incorporated in connection with the 1997 leveraged buyout to acquire Wilson Greatbatch Ltd., which is now our wholly-owned subsidiary. We acquired Hittman in August 1998 to expand and complement our product lines. Hittman, a medical components manufacturer, is a leading producer of feedthroughs and electrode components for implantable medical devices. Feedthroughs are among the most critical components used in implantable medical devices and both feedthroughs and electrodes are key component technologies.
In August 1998, we also sold the assets of our Greatbatch Scientific product line to focus on the newly-acquired Hittman product lines. Greatbatch Scientific was formed in 1996 to develop, manufacture and sell a line of battery-powered, magnetic resonance imaging, or MRI, compatible surgical instruments. In 1998, we concluded that this product line and customer base was not essential to our core operations and that instead we wanted to concentrate our efforts on integrating Hittman and completing the development of its capacitor program. We sold the assets of Greatbatch Scientific to an unrelated medical device company in exchange for approximately 12% of that company's stock in an investment valued at $2.4 million. This ended our expenditures on Greatbatch Scientific, which in 1998 were $1.3 million. In 1999 we wrote down our investment in this company by $0.9 million.
In August 2000, we acquired all of the capital stock of Battery Engineering, Inc., a small specialty battery manufacturer, from Hitachi Maxell, Ltd. in exchange for 339,856 shares of our common stock and assumption of approximately $2.7 million of indebtedness. The acquisition will be accounted for as a purchase. Battery Engineering, Inc. has approximately 90 full time employees and is part of our commercial power source operations. In a separate transaction, Hitachi Maxell, Ltd. also purchased 200,000 shares of our common stock for $15.00 per share.
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IMPLANTABLE MEDICAL DEVICE INDUSTRY
OVERVIEW
The following table sets forth the main categories of battery-powered implantable medical devices and the principal illness or symptom treated by each device:

DEVICE                                    PRINCIPAL ILLNESS OR SYMPTOM
------                                    ----------------------------
Pacemakers..............................  Abnormally slow heartbeat
ICDs....................................  Rapid and irregular heartbeat
Left ventricular assist devices.........  Heart failure
Hearing assist devices..................  Hearing loss
Neurostimulators........................  Tremors or chronic pain
Drug pumps..............................  Diabetes or chronic pain	

The implantable medical device industry is expected to grow primarily as a result of:
- advances in medical technology that will allow physicians to use implantable medical devices as a substitute for, or in conjunction with, prescription drugs, to treat a wider range of heart diseases, such as atrial fibrillation and congestive heart failure;
- increased use of recently developed implantable medical devices, including left ventricular assist devices, hearing assist devices, neurostimulators and drug pumps;
- expansion of indications, or uses, for implantable medical devices;
- the aging population, which is expected to require an increasing number of pacemakers, ICDs and other implantable medical devices;
- a combination of smaller, lighter, more efficient and more functional devices and longer-lasting power sources which will be easier for physicians to implant and will be less intrusive to recipients; and
- increased market penetration beyond the United States and other developed countries.
Medical Data International predicts that ICD revenues will grow more than four times faster than pacemaker revenues through 2004. The faster growth predicted for the ICD market is predicated on anticipated new applications for, and greater acceptance of, ICDs and an increased penetration of the ICD market.
MARKET OPPORTUNITY
The market for our power sources and components benefits directly from the growth of the implantable medical device industry. Manufacturers are dependent on advances in power sources and component technology to make their devices smaller, longer lasting, more efficient and more functional. In addition, manufacturers of implantable medical devices must be approved by the FDA, and have significant exposure to product liability claims and damages. To minimize risk and facilitate the FDA approval process, which can be lengthy, manufacturers of implantable medical devices generally require the highest quality, most reliable power sources and components available from proven suppliers. As a result, manufacturers generally enter into long term contracts with their suppliers and often collaborate with them on power source and component development. We believe that our proprietary technology, close customer relationships, market leadership and dedication to quality provide us with significant competitive advantages over our competitors and create a barrier to entry for potential market entrants.
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STRATEGY
Our objective is to enhance our position as a leading developer and manufacturer of power sources and other components for implantable medical devices. We intend to:
- EXPAND OUR PROPRIETARY TECHNOLOGY PORTFOLIO THROUGH CONTINUOUS TECHNOLOGICAL INNOVATION AND CONTINUE TO FOCUS OUR RESEARCH, DEVELOPMENT AND ENGINEERING EFFORTS ON PIONEERING POWER SOURCES AND ADVANCED COMPONENTS FOR IMPLANTABLE MEDICAL DEVICES. We commit substantial resources to research, development and engineering and believe that this commitment has enabled us to be at the forefront of the new technologies that are expected to drive the growth of the implantable medical device market in the foreseeable future. In 1999, we introduced a line of capacitors utilizing proprietary wet tantalum technology. Our innovative use of this technology enables us to produce capacitors that are significantly smaller than those currently used and offer improved electrical performance. We believe that our focus on technology has led to strong relationships with our customers and provides us significant advantages in maintaining our continued leadership within our markets.
- ENHANCE OUR POSITION AS AN INTEGRATED COMPONENT SUPPLIER TO THE IMPLANTABLE MEDICAL DEVICE INDUSTRY BY BROADENING OUR PRODUCT LINE TO INCLUDE A MORE COMPREHENSIVE RANGE OF POWER SOURCES AND COMPONENTS. We believe that there is a significant opportunity to provide our customers with substantially all of the key components for their products, other than microelectronics. Our position as a leading manufacturer of implantable medical device components allows us to provide a broader range of product components than any of our competitors. As a result of our 1998 acquisition of Hittman and the internal expansion of our components business, we are able to provide a major implantable medical device manufacturer with most of the components used in its pacemakers. We intend to continue to expand our product line. We believe that our customers value the benefits of a stable, reliable, quality-driven supplier which is able to provide a broad range of components to meet their product requirements.
- CONTINUE TO COLLABORATE WITH OUR CUSTOMERS TO JOINTLY DEVELOP NEW TECHNOLOGIES THAT ENABLE THEM TO DEVELOP AND MARKET INCREASINGLY MORE EFFECTIVE AND TECHNOLOGICALLY INNOVATIVE PRODUCTS. Our close relationships with our customers gives us significant advantages in anticipating and meeting their requirements and needs. We intend to continue to work closely with our customers to develop innovative medical devices that utilize our specially designed, proprietary power sources and components. We are currently collaborating with two leading manufacturers of ICDs to incorporate customized configurations of our new capacitors into their most advanced product programs. We believe that by integrating our development efforts with those of our customers, we can continue to create innovative and technologically superior products and strengthen our position as a single source supplier.
- ENTER INTO STRATEGIC ALLIANCES AND MAKE SELECTIVE ACQUISITIONS THAT COMPLEMENT OUR CORE COMPETENCIES IN TECHNOLOGY AND MANUFACTURING FOR BOTH IMPLANTABLE MEDICAL DEVICES AND OTHER DEMANDING COMMERCIAL APPLICATIONS. We regularly review strategic opportunities to acquire or license technologies. Through our 1998 acquisition of Hittman, we added two key component technologies, feedthroughs and electrodes, to our product offerings. We are currently working with strategic partners to develop rechargeable battery systems and technology for automatic external defibrillators. We believe that strategic alliances and selective acquisitions will enable us to accelerate the development of new technologies and grow our leading market share position.
PRODUCTS
We design and manufacture a variety of power sources, capacitors and components, such as feedthroughs, electrodes and precision components for implantable medical devices. Our technology is also used in a number of demanding commercial applications, including aerospace, oil and gas exploration and oceanographic equipment. The table set forth on page 3 of this Prospectus provides more detailed information about our principal products.
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IMPLANTABLE POWER SOURCES
The power sources that we produce are batteries. A battery is an electrochemical device that stores energy and releases it in the form of electricity. To generate an electrical current, electrons are first released from one part of the battery, called the anode or negative electrode. This flow of electrons, known as a current, travels to a load or device outside the battery. After powering the device, the electron flow reenters another part of the battery, called the cathode or positive electrode. As electrons flow from the anode to the device being powered by the battery, ions released from the anode cross through an electrolyte, which consists of one or more chemical compounds that facilitate the flow of ions to the cathode. The ions react with the cathode in order to complete the circuit. Separators are typically used inside the battery as electrical insulators to divide the anode and the cathode to prevent mechanical contact between them, which would result in the rapid depletion of the battery cell.
The following diagram illustrates the battery process described in the paragraph above:
[BATTERY PROCESS DIAGRAM]
From the late 1950s to the early 1970s, implantable medical devices, such as pacemakers, were powered by zinc/mercuric oxide batteries. These batteries typically lasted two to three years, often failed without warning, were large and bulky and generated hydrogen gas, making it impossible to seal the battery. In the early 1970s, we introduced lithium/iodine batteries as power sources for pacemakers. Lithium batteries manufactured by us and manufactured by others under license from us are now a principal power source for pacemakers. Pacemaker batteries utilizing our technology last approximately six years and provide high reliability and predictability. In the mid 1980s, we introduced lithium/silver vanadium batteries for powering ICDs. These batteries provide the higher power levels required by an ICD with a high degree of reliability and at least a five year battery life. Our lithium/silver vanadium oxide batteries have become a principal power source of ICDs.
39

In 1996, we introduced a lighter weight titanium-encased lithium/carbon monofluoride battery as the next generation pacemaker battery. These batteries offer improved pacemaker performance in several areas, including:
- pacemaker weight reduction of up to 25%;
- improved electrical performance, which is more suitable for use with the latest pacemaker microelectronics; and
- 10-15% longer battery life than comparable products.
In 1996, we introduced a new process for cathode manufacturing that enabled the production of significantly thinner cathodes than previously possible. As a result of this new cathode manufacturing process and other design improvements, our newest generation of ICD batteries is the thinnest commercially available and is up to 50% thinner than many existing models. Over the past few years, the decrease in battery size has contributed significantly to decreases in the size of ICDs, making these devices easier to implant.
CAPACITORS
Capacitors, which are used in ICDs, perform the critical function of storing electrical pulses before delivery to the heart. An ICD typically has two capacitors. Historically, ICDs utilized aluminum-based capacitors. In the fourth quarter of 1999, we introduced wet tantalum hybrid capacitors commercially for use in ICDs, which provide a number of advantages over aluminum-based capacitors. Our wet tantalum hybrid capacitors, which combine liquid electrolytes and ruthenium oxide cathode material with a tantalum anode component, provide a unique combination of high voltage and high energy storage capacity. This combination enables energy density not achievable with competing technologies. Our capacitors can be manufactured in many sizes and shapes to meet the specific needs of our customers.
To produce our capacitors, we have licensed wet tantalum technology from the Evans Capacitor Company. We are the exclusive licensee for implantable medical applications of this technology. We have also developed our own portfolio of patents and patent applications covering improvements that we have made to Evans' capacitor technology. In 1997, we entered into an agreement with a major ICD manufacturer to use our capacitor technology in their next generation of ICDs. We currently supply all of the capacitors used in the new generation of ICDs manufactured by this customer.
MEDICAL COMPONENTS
We manufacture feedthroughs, electrodes and other precision components that are utilized in implantable medical devices. Feedthroughs and electrodes are critical components of these devices that deliver electrical energy to the heart.
FEEDTHROUGHS. Feedthroughs are components that transmit electrical signals from inside an implantable medical device to the electrodes that transmit the signals to the body. Feedthroughs consist of an outer metallic structure called a flange, an electrical insulator made of ceramic or glass material, and wire connectors called poles that carry electrical signals from within the device. Our feedthroughs use a ceramic to metal seal that is substantially more durable than a traditional glass to metal seal. We also manufacture a feedthrough that includes a filtering capacitor that can filter out electromagnetic interference, such as signals from other implantable medical devices or cellular phones.
We design and manufacture 35 types of feedthroughs. Each of our feedthroughs is designed specifically for a particular customer device. We are often the sole source of feedthroughs for our customers. In 1999, approximately 95% of our feedthroughs were used in pacemakers and ICDs, with the balance used primarily in left ventricular assist devices, hearing assist devices, drug pumps and
40

neurostimulators. We are currently working with a number of medical device manufacturers to develop hermetic feedthroughs for the next generation of implantable medical devices and applications, including neurostimulators, middle ear devices, oxygen sensors and muscle stimulation devices.
ELECTRODES. Electrodes are components used in pacemakers and ICDs that deliver the electrical signal from the feedthrough to the heart to restore its normal rhythm. By coating the electrode with chemical compounds, we can enhance its electrical properties and therefore better deliver energy to the heart. Some electrode tips are designed to contain medication, such as steroids, to prevent scarring of the heart tissue following electrode implantation.
We design and manufacture a variety of coated electrodes, some of which have tips that can contain medication. We believe that our experience with physical deposition processes, such as sputtering and powder metallurgic techniques, has enabled us to produce high quality coated surfaces utilizing almost any combination of biocompatible coating surfaces. We believe that our coating technology can also be applied to future generation cardiovascular and non-cardiovascular implantable medical products, such as vascular stents, which are cynlindrical scaffolds used in cardiology procedures to help keep arteries open.
PRECISION COMPONENTS. We design and manufacture miniature precision components and subassemblies primarily for pacemaker and ICD manufacturers. Our precision components are machined or molded to adhere to tolerances up to one ten-thousandth of an inch. To manufacture precision components, we typically use various alloys of stainless steel, platinum, titanium, aluminum and brass, as well as plastics and composites. We also are the exclusive supplier of a critical drug pump subassembly for a manufacturer of implantable drug pumps. Although our primary focus is to develop and manufacture precision components for implantable medical devices, we also serve the general medical equipment market and the aerospace, oil and gas exploration and oceanographic industries.
COMMERCIAL POWER SOURCES
We have developed specialized power source technologies that are functional in high temperatures or under high shock and vibration. The majority of the commercial power sources that we sell are used in oil and gas exploration, including recovery equipment, pipeline inspection gauges, down-hole pressure measurement systems and seismic surveying equipment. We also supply power sources to NASA for its space shuttle program. In addition, our commercial power sources have been used for emergency position locating beacons and locator transmitters, classified governmental uses, electronic circuit breakers for industrial applications, weather balloon instrumentation, electricity transmission cable lighting detectors, wear monitors for train cables and scientific equipment used in Antarctica.
PRODUCT LINES UNDER DEVELOPMENT
RECHARGEABLE LITHIUM ION BATTERIES. We are currently developing a line of rechargeable lithium ion batteries that is expected to broaden and complement our current lines of lithium batteries. A number of new medical devices require rechargeable batteries, including:
- LEFT VENTRICULAR ASSIST DEVICES that are being developed to treat heart failure use external and internal batteries as power sources, both of which must be rechargeable. We are developing lithium ion rechargeable technology to produce lighter batteries with increased power and longer life.
- IMPLANTABLE HEARING ASSIST DEVICES that are used to treat patients who cannot use conventional hearing aids. These batteries are compact and are capable of providing low levels of current with infrequent recharging.
- NEUROSTIMULATORS AND DRUG PUMPS that are used for indications such as tremors, diabetes and chronic pain. Since these devices are sometimes implanted in young patients, the use of our
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rechargeable battery technology with extended device life should reduce the number of replacement implants needed throughout the life of the patient.
IMPLANTABLE PUMP TECHNOLOGY. We have developed proprietary technology that has applications in implantable devices that are designed to deliver small quantities of drugs or other fluids to a patient. Several of our technologies are critical to these devices, including the power source, the feedthroughs and the pumping mechanism that moves the fluid. Currently, one of our customers is seeking regulatory approval in Europe for a device that utilizes our implantable pump technology.
RESEARCH, DEVELOPMENT AND ENGINEERING
Our position as a leading developer and manufacturer of power sources for implantable medical devices is largely the result of our long history of technological innovation. We invest substantial resources in research, development and engineering. Our scientists, engineers and technicians focus on improving existing products, expanding the use of our products and developing new products. In addition to our internal technology and product development efforts, we maintain close relationships with leading research organizations, including Alfred University, Clarkson University, the Jet Propulsion Laboratory, the applied physics department of Johns Hopkins University, NASA, Sandia-National Laboratories, the State University of New York at Buffalo and Villanova University. These relationships include funding research efforts, licensing researchers' technology and assisting in building prototypes. Our research, development and engineering team is responsible for a number of pioneering developments in the implantable medical device industry including:

YEAR                           COMMERCIAL INTRODUCTION                    INDUSTRY IMPACT
----                    -------------------------------------   ------------------------------------
        1972            First lithium anode battery             Industry standard for pacemakers

        1974            First ceramic-to-metal seal for         Industry standard for sealing of
                        implantable devices                     devices

        1980            First oxyhalide/interhalogen            Enabled commercial batteries to
                        batteries                               perform at lower temperatures with
                                                                very high energy density

        1981            First implantable pump capable of       Enabled implantable drug delivery
                        passing bubbles                         system

        1987            First implantable lithium/silver        Enabled commercial viability of ICDs
                        vanadium oxide battery

        1996            First titanium-encased lithium/carbon   Enabled weight reduction and
                        monofluoride pacemaker batteries        improved electrical performance for
                                                                advanced microelectronics

        1999            First wet tantalum capacitors           Enabled smaller sizes of ICDs and
                                                                increased design flexibility	

PATENTS AND PROPRIETARY TECHNOLOGY
We rely on a combination of patents, licenses, trade secrets and know-how to establish and protect our proprietary rights to our technologies and products. To date, we have been granted 125 U.S. patents and 196 foreign patents. We also have 132 U.S. and 125 foreign pending patent applications at various stages of approval. During the past three years, we have received 39 new U.S. patents, of which 13 were received in 1999. Corresponding foreign patents have been issued or are expected to be issued in the near future. Often, a single product is protected by several patents covering various aspects of the design. We believe this provides broad protection of the concepts employed.
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The following table provides a breakdown of our patents as of July 1, 2000 by product type:

                                                       NUMBER OF        NUMBER OF
PRODUCT                                             PATENTS GRANTED   ACTIVE PATENTS
-------                                             ---------------   --------------
Batteries--Pacemakers.............................        164                23
Batteries--ICDs...................................         78                69
Capacitors........................................          3                 3
Feedthroughs......................................          2                 2
Pumps.............................................          8                 8
Batteries--Commercial.............................         11                11
Batteries--Rechargeable...........................          2                 2
Batteries--Lithium/carbon monofluoride............          5                 5
Other products....................................         48                14
                                                          ---               ---
    Total.........................................        321               137
                                                          ===               ===	

The following table sets forth the expiration dates of our material patents as of July 1, 2000:

                   DESCRIPTION OF PATENT                      EXPIRATION DATE
                   ---------------------                      ---------------
Anode assembly for lithium-halogen cell.....................   January 2001
Lithium-halogen cell........................................   January 2001
Anode assembly for lithium-halogen cell.....................   January 2001
Defibrillator cell design...................................     May 2006
Defibrillator cell design...................................     May 2006
Serpentine electrode design for prismatic cell..............     May 2011
Butterfly electrode assembly................................  September 2011
Butterfly electrode assembly................................  September 2011
Multiplate electrode design connected by bridge.............  September 2011
Insulating upper bag for increased cell reliability.........     May 2012
Halogenated polymer fiber separator for electrochemical
  cell......................................................   October 2013
Sheet cathode...............................................  November 2013
Sheet cathode...............................................  November 2013
High shock and vibration resistant cell design..............  February 2015
Aqueous blended electrode material..........................    March 2015
Carbonate electrolyte additives for defibrillator cells.....    March 2015
Separator insert for oxyhalide cell.........................  February 2016
Dual connection tab current collector for carbon
  monofluoride cells........................................    July 2016
Hermetic seal using a single close ball.....................   October 2016
Improved electrolyte/cathode ratio for carbon monofluoride
  cells.....................................................  November 2016
Ultrasonically coated substrate for use in a capacitor and
  method of manufacture.....................................     May 2017
Hermetically sealed wet tantalum capacitor..................     May 2017
Separator for use in carbon monofluoride cells..............    June 2017
Electrode edge design for increased energy density for
  carbon monofluoride cells.................................   August 2017
Insulating upper bag for increased cell reliability.........    April 2018	

In addition, we are also a party to several license agreements with third parties pursuant to which we have obtained, on varying terms, the exclusive or non-exclusive rights to patents held by third parties. We have also granted rights in our own patents to others under license agreements. We use our three material patents that expire in January 2001 in connection with our production of pacemaker batteries. The primary impact on our business as a result of the expiration of these patents will be the
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termination of the related royalties paid by Medtronic. Otherwise, we expect the impact of the expiration of these patents on our product line to be immaterial.
We license the basic capacitor technology used in our defibrillator capacitors from Evans Capacitor Company. The license extends throughout the lives of the related patents, which expire in 2010, 2013 and 2014. The license can be cancelled if we default under the license agreement and fail to cure the default. A cancellation of the license would seriously impair our ability to produce our entire line of capacitors.
We license the anode technology we use in our rechargeable lithium ion batteries from AT&T. The license extends throughout the lives of the related patents, which expire in 2000 and 2002. The license can be cancelled if we default under the license agreement and fail to cure the default. A cancellation of the license may impair our ability to produce our entire line of rechargeable lithium ion batteries. We do not expect the expiration of the license, as a result of the expiration of the patents underlying it, to have a material effect on any of our product lines.
It is our policy to require our executive and technical employees, consultants and other parties to execute confidentiality agreements. These agreements prohibit disclosure of confidential information to third parties except in specified circumstances. In the case of employees and consultants, the agreements generally provide that all confidential information relating to our business is the exclusive property of our company.
MANUFACTURING AND QUALITY CONTROL
Our principal manufacturing facilities are in Clarence, New York, Cheektowaga, New York, Canton, Massachusetts and Columbia, Maryland. Our three New York manufacturing facilities produce implantable power sources, capacitors, commercial power sources and components. Our Canton, Massachusetts facility produces commercial power sources. Our Columbia, Maryland facility produces feedthroughs, electrodes and other components. We test our implantable power sources at our Wheatfield, New York facility.
During the past two years, we have modernized our facilities and a number of our manufacturing lines, processes and equipment. These manufacturing improvements have enabled us to increase the quality and service life of our power sources and other components and increase our manufacturing capacity. Key resources that allow us to manufacture subassemblies include a full model shop, a precious metals machining area, injection molding equipment and a Class 10,000 clean room.
We primarily manufacture small lot sizes, as most customer orders range from a few hundred to thousands of units. As a result, our ability to remain flexible is an important factor in maintaining high levels of productivity. Each of our production teams receives assistance from a manufacturing support team, which typically consists of representatives from our quality control, engineering, manufacturing, materials and procurement departments.
Our quality system is based upon an ISO documentation system and is driven by a master validation plan that requires rigorous testing and validation of all new processes or process changes that directly impact our products. Our New York facilities are ISO-9001 certified, which requires compliance with regulations regarding quality systems of product design, supplier control, manufacturing processes and management review. This certification can only be achieved after completion of an audit conducted by an independent authority. Our New York facilities are audited by the British Standards Institute and are also certified by the British Standards Institute to the more rigorous EN-46001 standard that is usually reserved for manufacturers of medical devices. Our Columbia, Maryland facility is ISO-9002 certified and is audited by TUV Rheinland of North America, an independent auditing firm that specializes in evaluating ISO quality standards. To maintain certification, all facilities must be reexamined every six months by their respective certifying bodies.
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SALES AND MARKETING
We utilize a combination of direct and indirect sales methods, depending on the particular product. In 1999, approximately 73% of our products were sold in the United States.
We market and sell our implantable power sources and capacitors directly to manufacturers of implantable medical devices. The majority of our implantable power source customers contract with us to develop custom batteries or capacitors to fit their specific product specifications. As a result, we have established close working relationships between our internal program managers and our customers. We market our power source products and technologies at industry meetings and trade shows, including CardioStim and North American Society of Pacing and Electrophysiology or NASPE.
We sell feedthroughs, electrodes and other precision components directly to manufacturers. Two internal sales managers support all activity, and involve engineers and materials professionals in the sales process to appropriately address customer requests. As in the implantable power source and capacitor sales process, we have established relationships directly with leading manufacturers of implantable medical devices. We market our precision components, feedthroughs and electrodes by participating in the annual Medical Design and Manufacturing trade show and by producing printed and electronic marketing materials for distribution to prospective customers.
We sell our commercial power sources either directly to the end user, directly to manufacturers that incorporate our products into other devices for resale, or to distributors who sell our products to manufacturers and end users. Our sales managers are trained to assist our customers in selecting appropriate battery chemistries and configurations. We market our commercial power sources at various technical trade meetings, including the annual Petroleum Offshore Technology Conference and Offshore Europe. We also place print advertisements in relevant trade publications.
Firm backlog orders at December 31, 1999 and 1998 were $16.2 million and $24.6 million, respectively. Most of these orders were expected to be shipped within one year. As more of our customers move to "just in time" manufacturing systems, the amount of firm orders placed for delivery for more than a three or four month period has declined in recent years. This is a significant reason for the 34% reduction in backlog between December 31, 1999 and 1998.
CUSTOMERS
Our products are designed to provide reliable, long lasting solutions that meet the evolving requirements and needs of our customers and the end users of their products. Our medical products customers include leading implantable medical device manufacturers such as Guidant, St. Jude Medical and Medtronic. In 1999, Guidant accounted for approximately 33% of our revenues and St. Jude Medical accounted for approximately 31% of our revenues. Our commercial products customers are primarily companies involved in the aerospace, oil and gas exploration and oceanographic industries.
In February 1999, we entered into a supply agreement with Guidant. Pursuant to the agreement, Guidant purchases batteries and components from us for use in its implantable medical devices. Our supply agreement with Guidant expires on December 31, 2001 and can be renewed for additional one year periods upon mutual agreement.
In April 1997, we entered into a supply agreement with St. Jude Medical. In accordance with this agreement, we are the primary supplier of many components used in their pacemakers and ICDs, except for microprocessors and capacitors. We will also be the exclusive supplier of batteries to St. Jude Medical through the expiration of the supply agreement on December 31, 2003.
In March 1976, we entered into a technology transfer agreement and license agreement with Medtronic. Our license agreement provides Medtronic with the nonexclusive right to use our proprietary technology to manufacture its own batteries. The license agreement allows Medtronic to
45

manufacture lithium/iodine or lithium/halide batteries, but does not permit Medtronic to manufacture batteries using our new titanium lithium/carbon monofluoride technology. In accordance with the license agreement, Medtronic pays us a royalty for each battery used in each medical device that it sells. At the time we entered into the license agreement with Medtronic, there were a number of competing battery technologies. Our management believed that licensing our proprietary technology to Medtronic, which was the industry leader at that time, would help make our technology the industry standard. Our license agreement does not terminate so long as Medtronic uses any of our patented technology. However, we do not expect to receive significant royalties from Medtronic after 2000.
In July 1991, we entered into a defibrillator battery supply agreement with Medtronic. In accordance with the agreement, we provide Medtronic with lithium/silver vanadium oxide batteries for their ICDs. Our supply agreement with Medtronic expires on July 31, 2001.
SUPPLIERS AND RAW MATERIALS
Lithium, iodine and metal cases are the most significant raw materials that we use to manufacture our batteries. In the past, we have not experienced any significant interruptions or delays in obtaining raw materials. We seek to minimize inventory levels, which provides us with a reduced risk of obsolescence. Minimizing our inventory levels also enables us to stock materials based on firm order requirements, rather than forecasts and anticipated sales. However, we maintain minimum safety stock levels of critical raw materials. We seek to improve our supply purchase pricing by using bulk purchases, precious metal pool buys and blanket orders and by entering into long term contracts. Annual minimum purchase levels under these contracts have historically been well below our expected annual usage, and therefore present little risk of liability.
We have long standing relationships with most of our significant suppliers and have conducted business with them for an average of 13 years. Our supply agreements typically have three year terms. Our significant suppliers of raw materials and components accounted for approximately 31% of our purchases in 1999. We believe that there are alternative suppliers or substitute products available for each of the materials we purchase, at competitive prices. Our material supply agreements may be terminated prior to their scheduled expiration dates if there is a material breach by us that remains uncured.
COMPETITION
We currently supply implantable power sources, capacitors, feedthroughs, electrodes and precision components to the implantable medical device market. Our existing or potential competitors include:
- leading implantable medical device manufacturers, such as Guidant, St. Jude Medical and Medtronic, which have vertically integrated operations or may become vertically integrated in the future; and
- smaller companies that concentrate on niche markets.
Medtronic produces power sources for use in implantable medical devices that it manufactures. However, to our knowledge Medtronic does not sell power sources to third parties. Our company and Medtronic are the two major manufacturers of power sources for implantable medical devices. We also compete in the intensely competitive commercial power source market. Our principal competitors in this market are Eagle-Picher Industries, ECO-Tracer and Battery Engineering. While we believe that the industry perceives our products to be of the highest quality, there are suppliers whose products are perceived to be of comparable quality. Moreover, the commercial power source market is subject to volatility in oil and gas exploration activity. When oil and gas exploration activity has slowed, a number of our competitors have historically reduced battery prices to maintain or gain market share. Quality
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and technology are the principal bases upon which we compete in both the implantable medical devices market and the commercial power sources market.
GOVERNMENT REGULATION
Our business is not subject to direct governmental regulation other than the laws and regulations generally applicable to businesses in the jurisdictions in which we operate, including those federal, state and local environmental laws and regulations governing the emission, discharge, use, storage and disposal of hazardous materials and the remediation of contamination associated with the release of these materials at our facilities and at off-site disposal locations. Our research, development and engineering activities involve the controlled use of, and our products contain, small amounts of hazardous materials. Liabilities associated with hazardous material releases arise principally under the Comprehensive Environmental Response, Compensation and Liability Act and analogous state laws which impose strict, joint and several liability on owners and operators of contaminated facilities and parties that arrange for the off-site disposal of hazardous materials. We are not aware of any material noncompliance with the environmental laws currently applicable to our business and we are not subject to any material claim for liability with respect to contamination at any company facility or any off-site location. We cannot assure you, however, that we will not be subject to such environmental liabilities in the future as a result of historic or current operations.
As a component manufacturer, we produce products that are not subject to FDA approval. However, the FDA and related state and foreign governmental agencies regulate many of our customers' products as medical devices. The FDA must approve those products prior to commercialization. In addition, because some of the products produced by our engineered components division may be considered finished medical devices, some of the operations within that division are subject to FDA inspection and assessment.
RECRUITING AND TRAINING
We dedicate significant resources to our recruiting efforts. Our internal recruiting efforts primarily focus on supplying quality personnel to our business. We also seek to meet our hiring needs through outside sources. We believe that a strong human resources and recruiting effort is necessary to expand our current employee base and maintain our high employee retention rates. We have established a number of programs that are designed to challenge and motivate our employees and we encourage our employees to be proactive in contributing ideas and regularly survey them to collect feedback on ways that our business and operations can be improved.
We provide an intensive training program to our new employees which is designed to educate them on safety, quality, our business strategy and the methodologies and technical competencies that are required for our business and our corporate culture. Our safety training programs focus on such areas as basic industrial safety practices and emergency response procedures to deal with fires or chemical spills. All of our employees are required to participate in a specialized training program that is designed to provide an understanding of our quality objectives. We also have formal, mandatory training for all of our employees in their core competencies on an annual basis. We offer our employees a tuition reimbursement program and encourage them to continue their education at local colleges. Many of our professionals attend seminars on topics that are related to our corporate objectives and strategies. We believe that comprehensive training is necessary to ensure that our employees work in a uniform and consistent manner and that best practices are effectively utilized.
EMPLOYEES
As of July 1, 2000, we had 750 employees, including 135 research, development and engineering personnel, 448 manufacturing personnel and 167 support personnel. We also employ a number of
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temporary employees to assist us with various projects and service functions. In addition, Battery Engineering, Inc., which we acquired in August 2000, has approximately 90 full time employees. Our employees are not represented by any union and, except for executive officers of our company and our subsidiaries, are retained on an at-will basis. We believe that we have a good relationship with our employees.
PROPERTIES
Our executive offices are located in Clarence, New York. The building that houses our executive offices also contains warehouse operations, a variety of support services and capacity for light manufacturing or laboratory space.
The following table sets forth information about all of our principal manufacturing or testing facilities:

LOCATION                              SQ. FT.    OWN/LEASE                   USE
--------                              --------   ---------   ------------------------------------
Clarence, NY........................   70,400        Own     Battery manufacturing, development
Clarence, NY(1).....................   20,800        Own     Machining and assembly of components
Clarence, NY(1).....................   18,550      Lease     Machining and assembly of components
Clarence, NY........................   45,305      Lease     Offices and warehouse
Wheatfield, NY......................    2,600      Lease     Battery testing
Cheektowaga, NY.....................   19,900      Lease     Capacitor manufacturing
Canton, MA..........................   32,000        Own     Battery manufacturing
Columbia, MD........................   30,000      Lease     Feedthroughs, electrodes and
                                                             components manufacturing	

(1) We own and rent space in part of the same facility.
We believe these facilities are adequate for our current and foreseeable purposes and that additional space will be available when needed.
LEGAL PROCEEDINGS
We are involved in various lawsuits and claims incidental to our business. In the opinion of our management, the ultimate liabilities, if any, resulting from these lawsuits and claims will not materially affect our financial position or results of operations.
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MANAGEMENT
EXECUTIVE OFFICERS, DIRECTORS AND KEY EMPLOYEES
Our directors, executive officers and certain key employees, and their respective ages and positions as of July 1, 2000, are as follows:

NAME                                          AGE                           POSITION
----                                        --------                        --------
Edward F. Voboril.........................     57      President, Chief Executive Officer and Chairman of
                                                       the Board

Larry T. DeAngelo.........................     53      Vice President, Administration and Secretary

Curtis F. Holmes, Ph.D....................     57      President, Greatbatch-Hittman, Inc.

Arthur J. Lalonde.........................     45      Vice President, Finance and Treasurer

Richard W. Mott...........................     41      Group Vice President

Susan M. Bratton..........................     43      General Manager, Electrochem Battery

Robert C. Rusin...........................     42      Vice President, Corporate Quality

Esther S. Takeuchi, Ph.D..................     46      Vice President, Research and Development

David L. Jaffe............................     41      Director

Robert E. Rich, Jr........................     59      Director

Douglas E. Rogers.........................     45      Director

Henry Wendt...............................     66      Director

David M. Wittels..........................     35      Director	

EDWARD F. VOBORIL has served as President and Chief Executive Officer of our company and our predecessor since December 1990. Mr. Voboril became Chairman of our Board of Directors in July 1997. Mr. Voboril's career spans over 25 years in the medical device industry. Prior to joining our predecessor in 1990, Mr. Voboril was Vice President and General Manager of the Biomedical Division of PPG Industries. He was previously Vice President and General Manager of the Medical Electronics Division of Honeywell, which was acquired by PPG in 1986. Mr. Voboril currently serves on the board of directors of Analogic Corporation, an electronics company. Mr. Voboril served as President of the Health Care Industries Association of Western New York from July 1995 to July 1998 and currently serves as a member of the board of directors of the Health Industries Manufacturers Association, where he is a member of the executive committee and chairs the small company council.
LARRY T. DEANGELO has served as Vice President, Administration of our company and our predecessor since November 1991 and has served as our Secretary since July 1997. Prior to joining our predecessor, Mr. DeAngelo was the Director of International Human Resources of Rockwell International Corporation. Mr. DeAngelo is currently a member of the Payment and Health Care Delivery Committee of the Health Industry Manufacturers Association and chairman of the operating board for the Buffalo Hearing and Speech Center.
CURTIS F. HOLMES, PH.D. has served as President of our subsidiary, Greatbatch-Hittman, Inc., since January 2000. Dr. Holmes served as Senior Vice President and Chief Operating Officer of Greatbatch-Hittman, Inc. from July 1999 to December 1999 and as our Senior Vice President from January 1999 to July 1999. From November 1980 to January 1999, Dr. Holmes served as our Vice President, Technology.
ARTHUR J. LALONDE has served as our Vice President, Finance and Treasurer since July 1997 and previously served as the Controller of our predecessor from August 1988 to July 1997. Mr. Lalonde is a Certified Public Accountant and a member of the New York State Society of Certified Public
49

Accountants and the American Institute of Certified Public Accountants. Mr. Lalonde is also a member of the Investments Committee of HealthNow NY, Inc., the local Blue Cross/Blue Shield affiliate.
RICHARD W. MOTT has served as our Group Vice President since August 1998. Mr. Mott served as our Vice President, Batteries from July 1997 to August 1998 and previously served as the Vice President, Batteries of our predecessor from September 1993 to December 1996 and from November 1997 to July 1997. Mr. Mott also served as Vice President and General Manager of Greatbatch Scientific from December 1996 to August 1998.
SUSAN M. BRATTON has served as the General Manager, Electrochem Battery since July 1998 and previously served as the Director of Procurement for our company and our predecessor from June 1991 to July 1998. Ms. Bratton has held various positions with us since 1976.
ROBERT C. RUSIN has served as our Vice President, Corporate Quality since July 1999. From August 1998 to July 1999, Mr. Rusin served as President and Chief Operating Officer of BioVector, Inc. From January 1997 to August 1998, Mr. Rusin served as Director, Sales and Distribution, of Greatbatch Scientific and previously served as Director, Greatbatch Surgical Products for our predecessor from January 1995 to January 1997.
ESTHER S. TAKEUCHI, PH.D. has served as our Vice President, Research and Development since May 1999. Dr. Takeuchi served as our Director of Electrochemical Research from July 1997 to May 1999 and previously served as Director of Electrochemical Research of our predecessor from August 1991 to July 1997. The Electrochemical Society Inc. conferred the Battery Division Technology Award upon Dr. Takeuchi in 1995 and in 1998, the Western New York
Section of the American Chemical Society presented Dr. Takeuchi with the 68th Jacob F. Schoellkopf Medal. Dr. Takeuchi was elected a Fellow of the American Institute for Medical and Biological Engineering in 1999.
DAVID L. JAFFE has served as a director since December 1999. Mr. Jaffe is a Managing Director of DLJ Merchant Banking, Inc. Mr. Jaffe joined DLJ Merchant Banking, Inc. in 1984 and became a Managing Director in 1995. Mr. Jaffe serves on the boards of directors of Brand Scaffold Services, Inc., Duane Reade Inc., Shoppers Drug Mart, Inc. and Target Media Partners.
ROBERT E. RICH, JR. has served as a director since July 1997. Mr. Rich has served as President of Rich Products Corporation, a frozen foods manufacturer, since 1978. Mr. Rich is a member of the board of directors of the Uniform Code Council and Grocery Manufacturers of America, Inc.
DOUGLAS E. ROGERS has served as a director since July 1997. Since January 1997, Mr. Rogers has served as Managing Director of Global Health Care Partners, a unit of DLJ Merchant Banking specializing in private equity investment in health care businesses worldwide. Mr. Rogers previously served as head of U.S. Investment Banking at Baring Brothers and as a Senior Vice President at Lehman Brothers. Mr. Rogers serves on the board of directors of Charles River Laboratories Corp. and Computerized Medical Systems, Inc.
HENRY WENDT has served as a director since July 1997. Since January 1997, Mr. Wendt has served as Chairman of Global Health Care Partners, a unit of DLJ Merchant Banking specializing in private equity investment in healthcare businesses worldwide. Mr. Wendt retired as Chairman of SmithKline Beecham p.l.c. in 1994 after completing a career of nearly 40 years in the pharmaceutical, healthcare products and services industries. Mr. Wendt is Chairman of the Board of Computerized Medical Systems, Inc., and serves on the board of directors of Charles River Laboratories Corp., The Egypt Investment Company and West Marine, Inc., and also is a Trustee of the Trilateral Commission and Trustee Emeritus of the American Enterprise Institute.
DAVID M. WITTELS has served as a director since July 1997. Mr. Wittels has been a Principal of DLJ Merchant Banking, Inc. since January 1997. For the past five years, Mr. Wittels has held various
50

positions with DLJ Merchant Banking, Inc. He serves on the boards of AKI Holding Corp., AKI Inc., Mueller Holdings (N.A.), Inc., Ziff Davis Media Inc. and Ziff Davis Publishing Holdings, Inc.
In accordance with the stockholders agreements described below, all of the parties to the stockholders agreements have agreed to cause our Chief Executive Officer, presently Mr. Voboril, to be a member of our Board of Directors. DLJ Merchant Banking nominated Messrs. Jaffe, Rich, Rogers, Wendt and Wittels to be directors.
BOARD OF DIRECTORS
Our directors are elected annually to serve until the next annual meeting of stockholders or until their successors are duly elected and qualified. Our Board of Directors elects our executive officers annually to serve until the next annual meeting of the Board of Directors, or until their successors are duly elected and qualified, or until their earlier death, resignation, disqualification or removal from office.
BOARD COMMITTEES
Our Board of Directors has established a Compensation Committee, which consists of Messrs. Voboril, Wendt and Wittels. The Compensation Committee makes recommendations to the Board of Directors with respect to our general and specific compensation policies and administers our 1997 and 1998 stock option plans.
The Board of Directors has established an Audit Committee, which consists of Messrs. Rogers, Rich and Jaffe. The Board of Directors intends to name two additional independent directors to the Audit Committee after consummation of this offering. The Audit Committee reviews and reports to the Board of Directors on the scope and results of audits by our independent auditors and recommends a firm of certified independent public accountants to serve as our independent auditors, subject to nomination by the Board of Directors and approval by the stockholders. The Audit Committee also authorizes all audit and other professional services rendered by our independent auditors and periodically reviews the independence of the auditors. Membership on the Audit Committee is restricted to directors who are independent of management and free from any relationship that, in the opinion of the Board of Directors, would interfere with the exercise of independent judgment as a committee member.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 1999, our Compensation Committee consisted of Messrs. Voboril, Wendt and Wittels and Lawrence A. Maciariello, a former director. Mr. Voboril served as our President, Chief Executive Officer and Chairman of the Board during 1999. In November 1997, we issued a loan to Mr. Voboril in the amount of $570,000, which matures on November 1, 2007, in connection with his purchase of shares of our common stock. Mr. Wittels is a Principal of DLJ Merchant Banking, Inc. and from June 1997 to July 1997, prior to our acquisition of Wilson Greatbatch Ltd., he served as our President.
COMPENSATION OF DIRECTORS
Directors do not receive compensation for service as directors but are reimbursed for travel expenses and other out-of-pocket costs incurred in connection with their attendance at meetings.
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EXECUTIVE COMPENSATION
The following table sets forth information with respect to compensation for the year ended December 31, 1999 earned by our President, Chief Executive Officer and Chairman, and our four other most highly compensated executive officers as of December 31, 1999. In this prospectus, we refer to these individuals as our named executive officers.
SUMMARY COMPENSATION TABLE

                                                                                      LONG TERM COMPENSATION
                                                                                    --------------------------
                                               ANNUAL COMPENSATION                     AWARDS        PAYOUTS
                                 ------------------------------------------------   -------------   ----------
                                                                      OTHER          SECURITIES
                                                                      ANNUAL         UNDERLYING        LTIP         ALL OTHER
NAME AND PRINCIPAL POSITION           SALARY         BONUS(1)    COMPENSATION(2)       OPTIONS      PAYOUTS(3)   COMPENSATION(4)
---------------------------      -----------------   ---------   ----------------   -------------   ----------   ----------------
Edward F. Voboril..............  $         271,500   $253,078    $          --          40,940       $     --        $ 23,297
  President, Chief Executive
    Officer and Chairman

Larry T. DeAngelo..............            128,571     36,924               --           6,487        179,410          18,435
  Vice President,
    Administration and
    Secretary

Curtis F. Holmes, Ph.D.........            147,166     38,373           37,967           8,935        184,050         185,655
  President,
    Greatbatch-Hittman, Inc.

Richard W. Mott................            138,332     39,740               --           8,855        179,410          18,652
  Group Vice President

Fred Hittman...................            193,569         --               --           1,267             --           3,370
  Former President, Greatbatch-Hittman,
    Inc. (5)	

(1) Represents payments we made in fiscal 1999 for bonuses earned in prior years.
(2) Includes reimbursement of $31,397 of relocation expenses for Dr. Holmes. No other annual compensation is reported for Mr. Voboril, Mr. DeAngelo, Mr. Mott or Mr. Hittman because perquisites and personal benefits did not exceed the lesser of $50,000 and 10% of the total annual salary and bonus reported for these named executive officers.
(3) Represents payments we made in fiscal 1999 pursuant to our long term compensation plan, which was terminated in 1997. The final payment under the plan will be payable in 2001.
(4) Represents payments of term life insurance premiums of $3,497 for Mr. Voboril, $1,134 for Mr. DeAngelo and $1,761 for Dr. Holmes; our matching contributions to the 401(k) plan of $3,360 for Mr. Voboril, $2,744 for Mr. DeAngelo, $3,360 for Dr. Holmes, $2,923 for Mr. Mott and $3,370 for Mr. Hittman; our contributions under the ESOP plan of $8,440 for Mr. Voboril, $7,847 for Mr. DeAngelo, $8,147 for Dr. Holmes and $8,479 for Mr. Mott, which contributions represent 563, 523, 543 and 565 shares of our common stock, respectively; our contributions under our defined contribution pension plan of $8,000 for Mr. Voboril, $6,710 for Mr. DeAngelo, $6,965 for Dr. Holmes and $7,250 for Mr. Mott; and a payout of $165,422 to Dr. Holmes made in fiscal 1999 in respect of stock appreciation rights granted in prior years.
(5) Mr. Hittman served as the President of Greatbatch-Hittman, Inc. until his retirement on December 31, 1999.
STOCK OPTION GRANTS
The following table sets forth the stock options we granted during the fiscal year ended December 31, 1999 to each of the named executive officers, including the potential realizable value over the 10 year term of the options, based on assumed rates of stock appreciation of 5% and 10%, compounded annually. These assumed rates of appreciation are mandated by the rules of the Securities and Exchange Commission and do not represent our estimate of future stock price performance. Actual gains, if any, on stock option exercises will be dependent on the future performance of our common stock.
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OPTION GRANTS IN LAST FISCAL YEAR

                                                     INDIVIDUAL GRANTS
                       -----------------------------------------------------------------------------
                               NUMBER OF               PERCENTAGE OF
                              SECURITIES               TOTAL OPTIONS
                              UNDERLYING                 GRANTED IN                 EXERCISE
NAME                        OPTIONS GRANTED             FISCAL 1999             PRICE ($/SHARE)
----                   -------------------------   ----------------------   ------------------------
Edward F. Voboril....                    1,900                      1.4%    $                15.00

Edward F. Voboril....                   18,000                     13.0                      15.00

Edward F. Voboril....                   21,040                     15.2                      15.00

Larry T. DeAngelo....                      907                      0.7                      15.00

Larry T. DeAngelo....                    5,580                      4.0                      15.00

Curtis F.
  Holmes, Ph.D.......                    1,055                      0.8                      15.00

Curtis F.
  Holmes, Ph.D.......                    7,880                      5.7                      15.00

Richard W. Mott......                      976                      0.7                      15.00

Richard W. Mott......                    7,880                      5.7                      15.00

Fred Hittman.........                    1,267                      0.9                      15.00

                                                                        POTENTIAL REALIZABLE
                                INDIVIDUAL GRANTS                         VALUE AT ASSUMED
                       ------------------------------------                RATES OF STOCK
                                                                         PRICE APPRECIATION
                                                                        FOR OPTIONS TERM(1)
                                                              ----------------------------------------
NAME                             EXPIRATION DATE                      5%                   10%
----                   ------------------------------------   -------------------   ------------------
Edward F. Voboril....  September 23, 2009                     $            46,423   $           73,922
Edward F. Voboril....  March 10, 2009                                     439,802              700,310
Edward F. Voboril....  December 31, 2009                                  514,079              818,585
Larry T. DeAngelo....  September 23, 2009                                  22,161               35,288
Larry T. DeAngelo....  December 31, 2009                                  136,338              217,096
Curtis F.
  Holmes, Ph.D.......  September 23, 2009                                  25,777               41,046
Curtis F.
  Holmes, Ph.D.......  December 31, 2009                                  192,535              306,580
Richard W. Mott......  September 23, 2009                                  23,847               37,972
Richard W. Mott......  December 31, 2009                                  192,535              306,580
Fred Hittman.........  December 31, 2000                                   30,957               49,294	

(1) Computed using the fair market value on the date of grant of $15.00, as determined by our Board of Directors.
FISCAL YEAR END OPTION VALUES
The table below provides information about the number and value of options held by the named executive officers at December 31, 1999. In the absence of a regular, active public market for our common stock, and based in part on consideration of comparable companies, the Compensation Committee estimated the fair value of the stock options granted in fiscal 1999 to have been $15.00 per share. The values of in-the-money options have been calculated on the basis of a $15.00 per share fair market value of our common stock as of that date, less the applicable exercise price.
YEAR END OPTION VALUES

                                                    NUMBER OF SECURITIES
                                                   UNDERLYING UNEXERCISED      VALUE OF UNEXERCISED IN-THE-
                                                         OPTIONS AT                  MONEY OPTIONS AT
                                                      DECEMBER 31, 1999              DECEMBER 31, 1999
                                                 ---------------------------   -----------------------------
                                                 EXERCISABLE   UNEXERCISABLE   EXERCISABLE    UNEXERCISABLE
                                                 -----------   -------------   ------------   --------------
Edward F. Voboril..............................     30,632        121,448        $239,116        $689,684
Larry T. DeAngelo..............................     12,695         40,432         107,392         309,408
Curtis F. Holmes, Ph.D.........................     13,248         44,368         112,426         324,774
Richard W. Mott................................     13,880         45,608         112,426         324,774
Fred Hittman...................................      1,267             --              --              --	

EMPLOYMENT AGREEMENT
On July 9, 1997, we entered into an employment agreement with Mr. Voboril, our President, Chief Executive Officer and Chairman. The agreement currently expires on June 30, 2001 and automatically extends for additional one year periods until we or Mr. Voboril gives notice to terminate not less than 12 months prior to the proposed termination date. We currently pay Mr. Voboril $320,000 per year and our Compensation Committee, along with our Board of Directors, has the right to increase Mr. Voboril's salary. Under the agreement, Mr. Voboril is entitled to a bonus equal to 75% of his
53

current base salary if our company achieves financial targets set by our Board of Directors and reflected in our annual budget.
If we terminate Mr. Voboril's employment without cause or if Mr. Voboril terminates his employment for good reason, we have agreed to pay to Mr. Voboril the greater of $285,000 or his current annual base salary and a bonus for the year of termination equal to a percentage of his base salary. If we terminate his employment without cause within six months before, or twelve months after, a change in control of our company, we will pay Mr. Voboril an amount equal to his current annual salary and a bonus equal to 75% of his current base salary. In addition, all performance stock options held by Mr. Voboril will automatically vest and he will have the right to exercise all unexercised options.
If we terminate Mr. Voboril's employment for cause or if Mr. Voboril terminates his employment without good reason, we will pay him his accrued base salary and other compensation that has accrued as of the termination date. However, we will not pay Mr. Voboril an annual bonus if we terminate his employment with cause, and any stock options granted to Mr. Voboril that have not vested will be forfeited and canceled. If we terminate Mr. Voboril for cause, we may, at our election, purchase all of his shares and vested stock options at the lesser of the shares' cost or fair market value.
So long as Mr. Voboril is not terminated without cause, he has agreed not to compete, directly or indirectly, against us during his employment and for two years after his employment ends. In addition, Mr. Voboril has agreed not to solicit any of our employees for two years after his employment ends.
We have not entered into employment agreements with our other named executive officers.
STOCK PLANS
We have two stock option plans that provide for the issuance of nonqualified and incentive stock options to our key employees and key employees of our subsidiaries. The terms of our 1997 stock option plan and 1998 stock option plan are substantially the same and both plans are administered by our Compensation Committee. Our 1997 stock option plan authorizes the issuance of options to acquire up to 480,000 shares of our common stock and our 1998 stock option plan authorizes the issuance of options to acquire up to 1,220,000 shares of our common stock. Options granted under our 1997 and 1998 stock option plans generally vest over a three to five year period and the vesting period can be accelerated depending upon the achievement by our company of performance standards, including earnings targets. Options expire 10 years from the date of the grant, except that incentive stock options granted to key employees expire five years from the date of grant. Options are granted with exercise prices equal to the fair market value of our common stock on the date of the grant. Options generally are non-transferable, other than by will or the laws of descent and distribution and are exercisable only by the grantee while the grantee is alive. Both of our stock option plans contain a change in control provision. If a change in control of our company occurs, at the discretion of our Compensation Committee, each option granted under our stock option plans may be terminated. If this occurs, we are to pay each optionholder an amount equal to the difference between the fair market value of each share and the exercise price per share. This amount would be payable upon the closing of a transaction that results in a change in control.
As of August 15, 2000, 584,683 shares of our common stock were issuable upon exercise of outstanding stock options, subject in some cases to vesting conditions, and 1,086,689 options were available for future grants under our 1997 and 1998 stock option plans. The weighted average remaining contractual life of granted options is seven years. The average weighted exercise price per share of the options outstanding as of August 15, 2000 was $8.95.
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INCENTIVE COMPENSATION PLANS
We sponsor various incentive compensation programs, which provide for the payment of cash to key employees based upon achievement of specific earnings goals before incentive compensation expense. The scheduled aggregate payment amounts relating to our deferred compensation plans as of June 30, 2000 were as follows:

                                                               (IN THOUSANDS)
                                                              ----------------
2000........................................................       $   56
2001........................................................          631
2002........................................................           14
                                                                   ------
                                                                      701
Less current maturities of deferred compensation (included
  in accrued liabilities)...................................          (56)
                                                                   ------
Long-term portion of deferred compensation..................       $  645
                                                                   ======	

EMPLOYEE STOCK OWNERSHIP PLAN
We sponsor an employee stock ownership plan, or ESOP, and related trust as a long-term benefit for substantially all of our employees. There are two components to contributions under the ESOP. The first component is a defined contribution pension plan whose annual contribution equals 5% of each employee's compensation. Contributions to the ESOP are in the form of our common stock. The second component is a discretionary profit sharing contribution determined by the Board of Directors. This profit sharing contribution is also contributed to the ESOP in the form of shares of our common stock. The ESOP is subject to contribution limitations and vesting requirements.
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RELATED PARTY TRANSACTIONS
We describe below some of the transactions we have entered into with parties that are related to our company. We believe that each of the transactions described below was on terms no less favorable to us than we could have obtained from unrelated parties.
LEVERAGED BUYOUT
In July 1997, DLJ Merchant Banking and members of our management acquired our predecessor company, Wilson Greatbatch Ltd., in a leveraged buyout transaction. The Greatbatch family members who were the former controlling shareholders received a net aggregate amount of $93.25 million as the sellers in the leveraged buyout transaction. The Greatbatch family members also purchased 1,665,064 shares of our common stock at $5.00 per share for a total purchase price of $8,325,321. As a result of the leveraged buyout and transactions entered into in connection with it:
- DLJ Merchant Banking acquired 86.4% of our common stock;
- Greatbatch family members, who were the former controlling shareholders of our predecessor company, acquired 9.2% of our common stock;
- members of our management acquired 2.2% of our common stock; and
- holders of our 13% senior subordinated notes not affiliated with DLJ Merchant Banking acquired the remaining 2.2% of our common stock.
SALES OF COMMON STOCK TO MANAGEMENT
In July 1997, in connection with the leveraged buyout, we sold 8,346,364 shares of our common stock to DLJ Merchant Banking for an aggregate purchase price of $41,731,818. At that time, we also issued the following number of shares of common stock for the following purchase price to some of our executive officers:

                                                              NUMBER OF SHARES   PURCHASE PRICE
                                                              ----------------   --------------
Edward F. Voboril...........................................       57,000           $285,000
Tim H. Belstadt.............................................       22,200            111,000
Larry T. DeAngelo...........................................       25,600            128,000
Curtis F. Holmes, Ph.D......................................       26,800            134,000
Arthur J. Lalonde...........................................       18,000             90,000
Richard W. Mott.............................................       26,800            134,000
Susan M. Bratton............................................       14,200             71,000	

In November 1997, we sold 336,799 shares of our common stock, for an aggregate purchase price of $1,684,000, to some of our executive officers and issued loans to them in the amount of their respective purchase price, as further described below.
In August 1998, we sold 2,849,384 shares of our common stock to DLJ Merchant Banking for an aggregate purchase price of $14,246,919. At that time we also sold the following number of shares of common stock for the following purchase price to some of our executive officers:

                                                              NUMBER OF SHARES   PURCHASE PRICE
                                                              ----------------   --------------
Edward F. Voboril...........................................       60,822           $304,110
Tim H. Belstadt.............................................       20,000             99,999
Larry T. DeAngelo...........................................       27,316            136,381
Curtis F. Holmes, Ph.D......................................       28,597            142,986
Arthur J. Lalonde...........................................       20,299            101,493
Richard W. Mott.............................................        6,000             30,000
Susan M. Bratton............................................       16,000             80,001	

56

In September 1999, we sold 50,000 shares of our common stock for an aggregate purchase price of $750,000 to Fred Hittman, who at that time was serving as President of Greatbatch-Hittman, Inc.
DIRECTOR AND OFFICER LOANS
On November 1, 1997, we issued loans to a number of our executive officers and key employees in connection with their purchases of shares of our common stock. Each loan bears interest at an annual rate of 6.42%, is evidenced by a full recourse promissory note and secured by a pledge of the shares purchased with the proceeds of the loan and matures on November 1, 2007. The following table sets forth, with respect to our current and former executive officers and directors, the purchase price for the common stock, which is equal to the amount of indebtedness owed to us by each individual as of July 1, 2000 and the largest aggregate amount of indebtedness outstanding during the year ended December 31, 1999, and the number of shares of our common stock purchased and pledged by each individual to secure that indebtedness:

                                                              INDEBTEDNESS   SHARES PURCHASED
                                                              ------------   ----------------
Edward F. Voboril...........................................   $  570,000        114,000
Larry T. DeAngelo...........................................      256,000         51,200
Curtis F. Holmes, Ph.D......................................      268,000         53,600
Arthur J. Lalonde...........................................      180,000         36,000
Richard W. Mott.............................................      268,000         53,600
Susan M. Bratton............................................      142,000         28,400
                                                               ----------        -------
      Total.................................................   $1,684,000        336,800
                                                               ==========        =======	

The borrowers will have the option to repay their respective loans by tendering to us, at the time of the offering, a number of their shares of our common stock equal to their indebtedness, based on a price per share equal to the initial public offering price per share.
SECURITIES PURCHASE AGREEMENT
In July 1997, we and WGL Acquisition Corp., a company formed by DLJ Merchant Banking to acquire all of the shares of our predecessor, which later merged into our predecessor, entered into a securities purchase agreement with DLJ Investment Partners, L.P., DLJ Investment Funding, Inc., DLJ First ESC L.L.C. and Donaldson, Lufkin & Jenrette Securities Corporation, all of which are entities affiliated with DLJ Merchant Banking, and The Northwestern Mutual Life Insurance Company. In accordance with the agreement, we issued and sold 637,663 shares which at the time of issuance represented approximately 7% of our common stock. At the same time as the share issuance, WGL Acquisition Corp. issued 13% senior subordinated notes in the aggregate principal amount of $25.0 million, which have since become obligations of our company. Our senior subordinated notes mature on July 1, 2007. Affiliates of DLJ Merchant Banking originally purchased $22.5 million of the principal amount of the notes. In October 1997, an affiliate of DLJ Merchant Banking transferred $5.0 million of the principal amount of the notes to an affiliate of Merrill Lynch, Pierce Fenner & Smith Incorporated.
REGISTRATION AND ANTI-DILUTION AGREEMENT
We entered into a registration and anti-dilution agreement with DLJ Investment Partners, L.P., DLJ Investment Funding, Inc., DLJ First ESC L.L.C. and Donaldson, Lufkin & Jenrette Securities Corporation, all of which are entities affiliated with DLJ Merchant Banking, and The Northwestern Mutual Life Insurance Company in July 1997. The agreement provides for adjustments to the numbers of shares held by the purchasers to prevent dilution from issuance of shares for less than fair market price. If we propose to register any of our common stock under the Securities Act, either for our own account or for the account of other securityholders, the purchasing parties are entitled to include their
57

shares in the registration. In addition, parties holding more than 25% of the securities entitled to registration may require us to prepare and file a registration statement under the Securities Act at any time after this offering. We are not obligated to effect more than two of these demand registrations. The managing underwriter of the offering has the right to limit the number of shares in any registration relating to the agreement if the underwriter believes that the success of the offering would be materially and adversely affected because of its size or kind. If more than half of the securities entitled to registration are excluded by the managing underwriter, the holders of the registration rights are to be given an additional demand registration.
NOTE REGISTRATION RIGHTS AGREEMENT
We entered into a registration and anti-dilution agreement with DLJ Investment Partners, L.P., DLJ Investment Funding, Inc., DLJ First ESC L.L.C. and Donaldson, Lufkin & Jenrette Securities Corporation, all of which are entities affiliated with DLJ Merchant Banking, and The Northwestern Mutual Life Insurance Company in July 1997. The agreement provides that the parties will receive sufficient shares to prevent dilution if we issue shares at less than market value on the date of issuance or if we issue any securities convertible into shares at less than market value on the date of issuance and grants the parties registration rights with respect to the 13% senior subordinated notes. No conditions or options currently exist that would obligate us to issue more shares under the anti-dilution agreement.
AMENDED AND RESTATED CREDIT AGREEMENT
We entered into a credit agreement with a syndicate of financial institutions led by DLJ Capital Funding, Inc. on July 10, 1997. DLJ Capital Funding, Inc. is an affiliate of DLJ Merchant Banking. The parties to the credit agreement amended and restated it on August 7, 1998. On November 15, 1999, the parties to the credit agreement entered into a waiver and amendment which, among other things, waived compliance with financial covenants contained in the credit agreement. On February 10, 2000, the parties to the credit agreement again amended provisions of the credit agreement governing the applicable interest margins and financial covenants. The credit agreement includes the following commitments:
- a Term A loan commitment, under which:
- there is a maximum principal amount of $50.0 million;
- loan amounts bear interest, at our option, at prime plus 2.25% or LIBOR plus 3.50%;
- we had $43.8 million outstanding as of July 1, 2000; and
- loans mature on September 30, 2004.
- a Term B loan commitment, under which:
- there is a maximum principal amount of $60.0 million;
- loan amounts bear interest, at our option, at prime plus 2.50% or LIBOR plus 3.75%;
- we had $58.9 million outstanding as of July 1, 2000; and
- loans mature on September 30, 2006.
- a revolving line of credit commitment, under which:
- there is a maximum principal amount of $13.0 million, which may increase to $20.0 million after December 31, 2000, in each case if we meet our financial targets, including the debt to EBITDA ratio set forth in the credit agreement;
- we had $1.1 million outstanding and $11.9 million available, subject to customary borrowing conditions, as of July 1, 2000;
58

- loan amounts bear interest at prime plus 2.25% or LIBOR plus 3.50%;
- we pay a commitment fee equal to 0.50% per year, calculated on the unused portion on the revolving loan commitment; and
- loans mature on September 30, 2004.
The credit agreement also includes a letter of credit commitment in the maximum aggregate stated amount of $10.0 million and a swing line loan commitment in a maximum aggregate outstanding principal amount of $2.0 million. Our swing line loan facility is a subfacility of the revolving line of credit in which the agent advances funds on the same day, following timely notice by telephone, on behalf of the revolving credit lenders as a convenience for us and as an administrative convenience for the revolving credit lenders. The revolving credit lenders are required to fund their pro rata share of any swing line loan at the request of the agent if we do not repay the swing line loan.
The credit agreement is subject to conditions precedent, financial covenants, representations and warranties, as well as affirmative and negative covenants. Borrowings under the credit agreement are secured by our shares and shares of one of our affiliates, balances, credits and deposits and monies held by the lenders and substantially all of our assets. In connection with the credit agreement, we pledged all of the issued and outstanding shares of common stock of our subsidiary, WGL Intermediate Holdings, Inc., and that company pledged all of the issued and outstanding common shares of its subsidiary, Wilson Greatbatch Ltd., to Fleet National Bank, as administrative agent under the credit agreement.
The credit agreement provides that a change in control of our company constitutes an event of default. The failure of DLJ Merchant Banking to own in excess of 50% of the capital stock of our company and the failure of DLJ Merchant Banking to have the right to elect a majority of our Board of Directors constitute change in control events.
The credit agreement, in connection with the pledge agreements we entered into, entitles the holders of shares pledged under those agreements to require us to register the shares under the Securities Act if the administrative agent determines to exercise his right to sell the pledged shares upon the occurrence of an event of default under the credit agreement. In the event that we fail to register the pledged shares pursuant to the credit agreement, we will pay, as liquidated damages, an amount equal to the pledged shares' value as of the date that the administrative agent demanded registration.
In connection with the credit agreement, we have paid the following amounts to affiliates of DLJ Merchant Banking in the periods indicated for interest and various fees, including commitment, waiver and amendment and debt financing fees:

YEAR                                                   INTEREST PAID   FEES PAID
----                                                   -------------   ----------
1997.................................................    $423,886      $1,102,500
1998.................................................      52,246       1,709,189
1999.................................................          --              --
2000.................................................          --              --	

STOCKHOLDERS AGREEMENTS
In July 1997, we entered into three separate stockholders agreements with DLJ Merchant Banking and other parties, including members of our management who participated in the leveraged buyout and are stockholders of our company. Holders of an aggregate of 13,152,814 shares of our common stock are party to the three stockholders agreements. The terms of the three stockholders agreements are substantially the same. In the agreements, the parties agreed to elect our Board of Directors, transfer securities governed by the agreements and conduct and participate in registrations of securities governed by the agreements according to the terms of the agreements. The stockholders agreements
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prohibit most transfers of securities governed by the agreements unless the proposed transferor offers to include in the proposed transfer the other parties' pro rata share of securities subject to the agreement, or the transfer is made in connection with a party's exercise of its right of participation in such a transfer or DLJ Merchant Banking's exercise of its right of forced sale under the agreements. Most transfer restrictions under the stockholders agreements will terminate upon the consummation of this offering, or, in the case of the management stockholders agreement, one year after that date. The stockholders agreements will survive the closing of this offering. The agreements provide that the parties to the agreements and our company will take all action required to cause our Board of Directors to consist of seven directors, one of whom shall be our Chief Executive Officer. So long as they collectively beneficially own at least 3% of the fully-diluted shares of our common stock, members of the Greatbatch family, who are the former controlling stockholders of our company, have the right to nominate one director to our Board of Directors. DLJ Merchant Banking has the right to nominate all other members of our Board of Directors. The parties to the stockholders agreements have agreed to vote in favor of nominees selected by DLJ Merchant Banking and, if applicable, the Greatbatch family nominee. The members of our Board of Directors elected pursuant to the agreements include Mr. Voboril, our Chief Executive Officer, and Messrs. Jaffe, Rich, Rogers, Wendt and Wittels, each of whom was nominated by DLJ Merchant Banking. There is currently one vacancy on our Board of Directors, which we anticipate will be filled in the fall of 2000.
All the stockholders party to the stockholders agreements agree to vote their shares in elections of directors in accordance with the terms of the stockholders agreements. Therefore, each party may be deemed to share beneficial ownership of all shares subject to each stockholders agreement to which it is a party. Entities affiliated with DLJ Merchant Banking II, L.P. are party to all three stockholders agreements and consequently may be deemed to beneficially own the aggregate of all 12,562,958 shares subject to the three agreements. This number includes all of the 10,228,214 shares of common stock held directly by the entities affiliated with DLJ Merchant Banking II, L.P. Members of our management are party to two of the three agreements, the stockholders agreement dated as of July 16, 1997 and the management stockholders agreement dated as of July 10, 1997, and consequently may be deemed to beneficially own the aggregate of all 11,949,772 shares subject to those two agreements, in addition to the shares held by them directly.
Subject to pro rata and underwriter exceptions, if we propose to file a registration statement relating to an offering of any of our equity securities, the parties to the agreements have the right to have their shares of our common stock registered and sold as part of the offering.
DLJ FINANCIAL ADVISORY AGREEMENT
On July 10, 1997, we appointed Donaldson, Lufkin & Jenrette Securities Corporation, or DLJ, to act as our exclusive financial advisor with respect to reviewing and analyzing financial alternatives for our company. Under the agreement, DLJ assists us from time to time in analyzing our operations and historical performance as well as our future prospects, with a view to meeting our long term strategic objectives. The agreement expires on July 10, 2002. In accordance with this agreement, we pay DLJ $100,000 annually and as further compensation, DLJ has the right to act as our exclusive financial advisor and sole managing underwriter for any underwritten public offering of our stock and other financial transactions consummated by our company during the engagement period. DLJ is an affiliate of DLJ Merchant Banking and is one of the joint book-running managers for this offering.
HITTMAN AGREEMENTS
In August 1998, we purchased all of the outstanding capital stock of Hittman from Fred Hittman, the sole shareholder, for $71.8 million. Fred Hittman subsequently served as the President of our subsidiary Greatbatch-Hittman, Inc. until his retirement on December 31, 1999. We paid $69.0 million of the purchase price at the time of the acquisition and an additional $2.8 million after Hittman
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achieved financial targets in 1998. We paid DLJ a fee of approximately $2.8 million for acting as our financial advisor in connection with the acquisition, for its underwriting fee and for a bond consent fee.
We lease our Columbia, Maryland facility from Mr. Hittman under an agreement that expires in 2006. In accordance with the agreement, we made payments to Mr. Hittman of $83,655 for the period from August 8, 1998 to the end of fiscal 1998 and $210,600 in 1999. The annual rental payment under the lease is $210,600 until 2003, at which time it increases annually until the termination of the lease. The average annual rental payment throughout the term of the lease is $219,600. In addition, we have an option to purchase the leased property for the agreed fair market value at the time when the lease expires.
In August 1999, we entered into a stockholders agreement with Fred Hittman, then President of Greatbatch-Hittman, Inc., and DLJ Merchant Banking. In the agreement, we and Fred Hittman agreed to elect our Board of Directors and conduct and participate in registrations of securities governed by the agreements according to the terms of the agreement. The stockholders agreement generally prohibits Mr. Hittman from transferring securities governed by the agreement unless the transfer is made in connection with an exercise of his right of participation in transfers made by DLJ Merchant Banking or DLJ Merchant Banking's exercise of its right of forced sale under the agreement. Most transfer restrictions under the stockholders agreement will terminate upon the consummation of this offering. The stockholders agreement will survive the closing of this offering. The stockholders agreement provides that Fred Hittman will take all action within his power required to cause our Board of Directors to include all of the directors designated by DLJ Partners II or its successor in interest. Therefore, because an entity affiliated with DLJ Merchant Banking II, L.P. has the power to direct the voting of Mr. Hittman's shares in this respect, the entities affiliated with DLJ Merchant Banking II, L.P. may be deemed to share beneficial ownership of all of Mr. Hittman's 50,000 shares that are subject to the stockholders agreement. However, because Mr. Hittman does not have the power to direct the voting of shares owned by the entities affiliated with DLJ Merchant Banking II, L.P. under the terms of the stockholders agreement, Mr. Hittman does not share voting power with respect to those shares and consequently is not deemed to beneficially own any of such shares as a result of the stockholders agreement.
GREATBATCH LEASE AGREEMENT
We lease approximately 18,550 square feet at one of our Clarence, New York facilities from Warren Greatbatch, as trustee under an irrevocable trust agreement for the benefit of Ericka Dee Greatbatch, who is the niece of Lawrence
A. Maciariello, a former director. Warren Greatbatch is the brother-in-law of Mr. Maciariello. In accordance with the lease agreement, which will expire on March 31, 2018, we made payments to the trust of $86,400 per year in each of fiscal 1997, 1998 and 1999. This lease provides that the rental rate is to be adjusted in 2003, 2008 and 2013 to reflect the fair market rental value at that time.
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PRINCIPAL STOCKHOLDERS
The following table sets forth information regarding beneficial ownership of our common stock as of August 15, 2000, and as adjusted to reflect the sale of shares of our common stock in this offering, by:
- each person who owns more than 5% of our outstanding shares of common stock;
- each of our named executive officers;
- each of our directors; and
- all of our directors and executive officers as a group.

                                                                                               PERCENTAGE OF
                                                                                               COMMON STOCK
                                                                                                OUTSTANDING
                                                                   NUMBER OF SHARES         -------------------
                                                                     BENEFICIALLY            BEFORE     AFTER
NAME OF BENEFICIAL OWNER                                                 OWNED              OFFERING   OFFERING
------------------------                                      ---------------------------   --------   --------
Entities affiliated with DLJ Merchant
Banking Partners II, L.P. (1)(2)............................                  13,152,814     100.0%      73.7%
  277 Park Avenue
  New York, New York 10172
Edward F. Voboril (3)(4)....................................                  11,980,404      91.1%      67.1%
Larry T. DeAngelo (3)(5)....................................                  11,962,467      90.9%      67.0%
Curtis F. Holmes, Ph.D. (3)(6)..............................                  11,963,020      91.0%      67.0%
Richard W. Mott (3)(7)......................................                  11,963,640      91.0%      67.0%
Fred Hittman(8).............................................                      51,267      *          *
David L. Jaffe (2)(9).......................................                  13,152,814     100.0%      73.7%
Robert E. Rich, Jr.(3)(10)..................................                  11,949,772      90.9%      66.9%
Douglas E. Rogers (2)(9)....................................                  13,152,814     100.0%      73.7%
Henry Wendt (2)(9)..........................................                  13,152,814     100.0%      73.7%
David M. Wittels (2)(9).....................................                  13,152,814     100.0%      73.7%
All directors and executive officers as a
group (10 persons) (2)(3)(4)(5)(6)(7)(9)(10)(11)............                  13,223,257     100.0%      74.1%	

* Less than one percent
(1) Consists of shares held directly by DLJ Merchant Banking Partners II, L.P. and the following related investors: DLJ Merchant Banking Partners II-A, L.P., DLJ Offshore Partners II, C.V., DLJ Diversified Partners, L.P., DLJ Diversified Partners-A, L.P., DLJ Millennium Partners, L.P., DLJ Millennium Partners-A, L.P., DLJMB Funding II, Inc., DLJ Investment Partners, L.P., DLJ Investment Funding, Inc., UK Investment Plan 1997 Partners, DLJ EAB Partners, L.P., DLJ First ESC, L.P. and DLJ ESC II, L.P. In the aggregate, these entities have sole investment power with respect to 10,228,214 shares of common stock, which is equivalent to 77.8% of the common stock outstanding before this offering and 57.3% of the common stock outstanding after this offering.
(2) Voting power with respect to the shares reported is shared, pursuant to the stockholders agreements entered into in July 1997, August 1999 and August 2000, with the other parties to the stockholders agreements. Therefore, the various entities affiliated with DLJ Merchant Banking and Messrs. Jaffe, Rogers, Wendt and Wittels each may be deemed to beneficially own all of the 13,152,814 shares of common stock with respect to which voting power is shared pursuant to the stockholders agreements.
(3) Voting power with respect to the shares reported is shared, pursuant to stockholders agreements entered into in July 1997, with the other parties to the stockholders agreements. Therefore, Messrs. Voboril, DeAngelo, Holmes, Mott and Rich each may be deemed to beneficially own all of the 11,949,772 shares of common stock with respect to which voting power is shared pursuant to the stockholders agreements. Messrs. Voboril, DeAngelo, Holmes, Mott and Rich disclaim beneficial ownership of such shares, other than the 262,453
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shares, 116,811 shares, 122,245 shares, 96,865 shares and 20,000 shares held directly by Messrs. Voboril, DeAngelo, Holmes, Mott and Rich, respectively.
(4) Includes 30,632 shares Mr. Voboril has the right to acquire pursuant to options exercisable within 60 days after August 15, 2000. Including such shares, Mr. Voboril directly holds 262,453 shares of common stock, which is equivalent to 2.1% of the common stock outstanding before this offering and 1.5% of the common stock outstanding after this offering.
(5) Includes 12,695 shares Mr. DeAngelo has the right to acquire pursuant to options exercisable within 60 days after August 15, 2000. Including such shares, Mr. DeAngelo directly holds 116,811 shares of common stock, which is equivalent to less than one percent of the common stock outstanding both before and after this offering.
(6) Includes 13,248 shares Mr. Holmes has the right to acquire pursuant to options exercisable within 60 days after August 15, 2000. Including such shares, Mr. Holmes directly holds 122,245 shares of common stock, which is equivalent to less than one percent of the common stock outstanding both before and after this offering.
(7) Includes 866 shares held by Mr. Mott as trustee of the Sarah E. Mott Trust, 866 shares held by Mr. Mott as trustee of the Lindsay Mott Trust, 866 shares held by Mr. Mott as trustee of the Rachel Mott Trust and 13,868 shares Mr. Mott has the right to acquire pursuant to options exercisable within 60 days after August 15, 2000. Including such shares, Mr. Mott directly holds 96,865 shares of common stock, which is equivalent to less than one percent of the common stock outstanding both before and after this offering.
(8) Includes 1,267 shares Mr. Hittman has the right to acquire pursuant to options exercisable within 60 days after August 15, 2000. Voting power with respect to the shares reported is shared, pursuant to a stockholders agreement entered into in August 1999, with the entities affiliated with DLJ Merchant Banking Partners II, L.P.
(9) Consists of shares held by entities affiliated with DLJ Merchant Banking Partners II, L.P., all of which are funds managed by DLJ Merchant Banking. Messrs. Jaffe, Rogers, Wendt and Wittels disclaim beneficial ownership of such shares.
(10) Mr. Rich directly holds 20,000 shares of common stock, which is equivalent to less than one percent of the common stock outstanding both before and after this offering.
(11) All directors and executive officers as a group directly hold 10,929,803 shares of common stock, which is equivalent to 83.1% of the common stock outstanding before this offering and 61.2% of the common stock outstanding after this offering.
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DESCRIPTION OF CAPITAL STOCK
Immediately following the consummation of this offering, the authorized capital stock of our company will consist of 100,000,000 shares of common stock, par value $.001 per share, and 100,000,000 shares of preferred stock, par value $.001 per share, the rights and preferences of which may be established from time to time by our Board of Directors. As of August 15, 2000, there were 13,152,814 shares of common stock outstanding that were held of record by approximately 100 stockholders. Upon completion of this offering, there will be 17,852,814 outstanding shares of common stock, no outstanding shares of preferred stock and options to purchase 584,683 shares of common stock.
The following discussion summarizes the material provisions of our capital stock and the anti-takeover provisions that will be contained in our certificate of incorporation and bylaws upon consummation of this offering. This summary is qualified by our restated certificate of incorporation and bylaws, copies of which have been filed as exhibits to the registration statement of which this prospectus is a part.
Our restated certificate of incorporation and bylaws contain provisions, such as the authorization of "blank check" preferred stock, limiting who may call special meetings of our stockholders and advance notice procedures that are required for stockholders to nominate candidates for election to our Board of Directors or propose matters to be acted upon at stockholder meetings, which are intended to enhance the likelihood of continuity and stability in the composition of our Board of Directors. "Blank check" preferred stock could be issued by our Board of Directors, without the delay that would be required to obtain stockholder approval, to increase the number of outstanding shares and thwart a takeover attempt. Limitations on who may call special meetings of our stockholders make it difficult for minority stockholders to call special meetings in which a new Board of Directors could be elected, among other things. Advance notice requirements for nominations of candidates for election to our Board of Directors or to propose matters to be acted upon by stockholders at stockholder meetings make it more difficult for stockholders to nominate new directors or submit stockholder proposals to be acted upon at stockholder meetings. These provisions may have the effect of delaying, deferring or preventing a future takeover or change in control of our company, unless such takeover or change in control is approved by our Board of Directors.
COMMON STOCK
Holders of our common stock are entitled to one vote per share on all matters to be voted upon by the stockholders. Because holders of common stock do not have cumulative voting rights, the holders of a majority of the shares of common stock can elect all of the members of our Board of Directors. Subject to preferences of any preferred stock that may be issued in the future, the holders of common stock are entitled to receive dividends as may be declared by our Board of Directors. The common stock is entitled to receive pro rata all of the assets of our company available for distribution to our stockholders. There are no redemption or sinking fund provisions applicable to the common stock. All outstanding shares of common stock are fully paid and non-assessable.
PREFERRED STOCK
Our Board of Directors will be authorized, without further action by our stockholders, to issue shares of preferred stock in one or more series. The Board will have discretion to determine the rights, preferences, privileges and limitations of each series, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences. Satisfaction of any dividend preference of outstanding shares of preferred stock would reduce the amount of funds available for the payment of dividends on shares of common stock. In some circumstances, the issuance of shares of preferred stock may render more difficult or tend to discourage a merger, tender offer or proxy contest, the
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assumption of control by a holder of a large block of our securities or the removal of incumbent management. We have no current intention to issue any shares of preferred stock.
OPTIONS
As of August 15, 2000, options to purchase a total of 584,683 shares of our common stock were outstanding, and options to acquire up to 1,086,689 shares of common stock may be available for future issuance under our existing stock option plans. The average weighted exercise price per share of the options outstanding as of August 15, 2000 was $8.95.
REGISTRATION RIGHTS
After this offering, the holders of 13,152,814 shares of our common stock will be entitled to registration rights. If we propose to register any of our securities under the Securities Act, either for our own account or for the account of other security holders exercising registration rights, these holders are entitled to notice of registration and are entitled to include shares of common stock, subject to pro rata and underwriting exceptions. Additionally, some of our stockholders have demand registration rights pursuant to which they may require us on up to two occasions, to file a registration statement under the Securities Act at our expense. The registration rights are subject to the right of the underwriters of an offering to limit the number of shares included in the registration and our right not to effect a required registration within 180 days following an offering of our securities pursuant to a registration statement in connection with an underwritten public offering, including this offering. If more than half of the securities entitled to demand registration are excluded by the underwriters, the holders of demand registration rights are to be given an additional demand registration right. These registration rights are also subject to our right not to effect a requested registration, for no more than one 120 day period during any calendar year, if our Board of Directors determines in good faith to delay the filing to allow our company to include financial statements in the registration statement or if our Board of Directors reasonably determines that effectiveness of the registration statement or an offering would materially adversely affect a pending or proposed acquisition, merger or other significant corporate transaction.
LIMITATION OF LIABILITY OF OFFICERS AND DIRECTORS
Our restated certificate of incorporation limits the liability of directors to the fullest extent permitted by Delaware law. The effect of these provisions is to eliminate the rights of our company and our stockholders, through stockholders' derivative suits on behalf of our company, to recover monetary damages against a director for breach of fiduciary duty as a director, including breaches resulting from grossly negligent behavior. However, our directors will be personally liable to us and our stockholders for monetary damages if they acted in bad faith, knowingly or intentionally violated the law, authorized illegal dividends or redemptions or derived an improper benefit from their actions as directors. In addition, our restated certificate of incorporation provides that we will indemnify our directors and officers to the fullest extent permitted by Delaware law. We expect to enter into indemnification agreements with our current directors and executive officers prior to the completion of this offering. We also maintain directors and officers insurance.
DELAWARE ANTI-TAKEOVER LAW
We are subject to Section 203 of the Delaware General Corporation law which regulates corporate acquisitions. This law provides that specified persons who, together with affiliates and associates, own, or within three years did own, 15% or more of the outstanding voting stock of a corporation may not engage in business combinations with the corporation for a period of three years after the date on which the person became an interested stockholder. The law does not include interested stockholders prior to the time our common stock is listed on The New York Stock Exchange. The law defines the
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term "business combination" to include mergers, asset sales and other transactions in which the interested stockholder receives or could receive a financial benefit on other than a pro rata basis with other stockholders. This provision has an anti-takeover effect with respect to transactions not approved in advance by our Board of Directors, including discouraging takeover attempts that might result in a premium over the market price for the shares of our common stock. With approval of our stockholders, we could amend our certificate of incorporation in the future to avoid the restrictions imposed by this anti-takeover law.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for our common stock is ChaseMellon Shareholder Services, L.L.C.
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SHARES ELIGIBLE FOR FUTURE SALE
Upon completion of this offering, we will have 17,852,814 outstanding shares of common stock and outstanding options to purchase 584,683 shares of our common stock, assuming no exercise of the underwriters' over-allotment option and no additional option grants or exercises after August 15, 2000. We expect that the 4,700,000 shares to be sold in this offering, plus any shares issued upon exercise of the underwriters' over-allotment option, will be freely tradable without restriction under the Securities Act, unless purchased by our "affiliates," as that term is defined in Rule 144 under the Securities Act. The remaining 13,152,814 shares outstanding and 584,683 shares subject to outstanding options are "restricted securities" within the meaning of Rule 144 under the Securities Act. Restricted securities may be sold in the public market only if the sale is registered or if it qualifies for an exemption from registration, such as under Rule 144, Rule 144(k) or Rule 701 promulgated under the Securities Act, which are summarized below.
LOCK-UP AGREEMENTS
We, our executive officers and directors and substantially all of our stockholders, including DLJ Merchant Banking, have agreed, for a period of 180 days after the date of this prospectus, not to, without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation:
- offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock; or
- enter into any swap or other arrangement that transfers all or a portion of the economic consequences associated with the ownership of any common stock, regardless of whether any of the transactions described in these clauses are to be settled by the delivery of common stock, or such other securities, in cash or otherwise.
RULE 144
In general, under Rule 144 as currently in effect, beginning 180 days after the date of this prospectus, a person who has beneficially owned restricted securities for at least one year would be entitled to sell within any three-month period a number of shares that does not exceed the greater of:
- 1% of the number of shares of common stock then outstanding, which will equal approximately 178,528 shares immediately after this offering; and
- the average weekly trading volume of our common stock on The New York Stock Exchange during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.
Sales under Rule 144 are also subject to requirements with respect to manner of sale, notice and the availability of current public information about us.
RULE 144(K)
Under Rule 144(k), a person who is not deemed to have been our affiliate at any time during the three months preceding a sale, and who has beneficially owned the shares proposed to be sold for at least two years, may sell these shares without complying with the manner of sale, public information, volume limitation or notice requirements of Rule 144.
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RULE 701
Rule 701, as currently in effect, permits our employees, officers, directors or consultants who purchased shares pursuant to a written compensatory plan or contract to resell these shares in reliance upon Rule 144, but without compliance with holding period and in some cases volume limitation and other restrictions. Rule 701 provides that affiliates may sell their Rule 701 shares under Rule 144, 90 days after the effective date of this offering without complying with the holding period requirement contained in Rule 144 and that non-affiliates may sell such shares in reliance on Rule 144 90 days after the effective date of this offering without complying with the holding period, public information, volume limitation or notice requirements of Rule 144.
REGISTRATION RIGHTS
After this offering, the holders of approximately 13,152,814 shares of common stock will be entitled to rights with respect to registration of these shares under the Securities Act. Registration of these shares under the Securities Act would result in these shares, except for shares purchased by affiliates of our company, becoming freely tradable without restriction under the Securities Act immediately on the effective date of this offering.
STOCK OPTIONS
Following expiration of the 180 day lock-up period described above, we intend to file a registration statement on Form S-8 under the Securities Act to register all shares of common stock subject to outstanding stock options and common stock issued or issuable under our stock option plans. Shares of common stock registered under any registration statement will, subject to Rule 144 volume limitations applicable to affiliates, be available for sale in the open market.
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UNDERWRITING
Subject to the terms and conditions of an underwriting agreement dated , 2000, the underwriters named below, who are represented by Donaldson, Lufkin & Jenrette Securities Corporation, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Banc of America Securities LLC, U.S. Bancorp Piper Jaffray Inc. and DLJDIRECT Inc., have severally agreed to purchase from us the number of shares of common stock set forth opposite their names below.

                                                               NUMBER
UNDERWRITERS                                                  OF SHARES
------------                                                  ---------
Donaldson, Lufkin & Jenrette Securities Corporation.........
Merrill Lynch, Pierce, Fenner & Smith
          Incorporated......................................
Banc of America Securities LLC..............................
U.S. Bancorp Piper Jaffray Inc..............................
DLJDIRECT Inc...............................................
                                                                 ---
    Total...................................................
                                                                 ===	

The underwriting agreement provides that the obligations of the several underwriters to purchase and accept delivery of the shares of our common stock offered by this prospectus are subject to the approval by their counsel of legal matters and other conditions. The underwriters must purchase and accept delivery of all the shares of our common stock offered by this prospectus, other than those shares covered by the over-allotment option described below, if any are purchased.
The underwriters propose initially to offer some of the shares of our common stock directly to the public at the public offering price on the cover page of this prospectus and some of the shares of our common stock to dealers, including the underwriters, at the public offering price less a concession not in excess of $ per share. The underwriters may allow, and these dealers may re-allow, a concession not in excess of $ per share on sales to other dealers. After the initial offering of our shares to the public, the representatives of the underwriters may change the public offering price and other selling terms.
We have granted to the underwriters an option, exercisable within 30 days after the date of the underwriting agreement, to purchase up to 705,000 additional shares of our common stock at the initial public offering price less underwriting discounts and commissions. The underwriters may exercise this option solely to cover over-allotments, if any, made in connection with this offering. To the extent that the underwriters exercise this option, each underwriter will become obligated, subject to certain conditions, to purchase a number of additional shares approximately proportionate to their initial purchase commitment.
The following table shows the underwriting fees to be paid by us in this offering. These amounts are shown assuming both no exercise and full exercise of the underwriters' option to purchase additional shares of our common stock.

                                                       NO EXERCISE   FULL EXERCISE
                                                       -----------   -------------
Per share............................................    $             $
Total................................................    $             $	

We will pay the offering expenses, estimated to be $1,550,000.
We have agreed to indemnify the underwriters against specified civil liabilities, including liabilities under the Securities Act, or to contribute to payments that the underwriters may be required to make because of those liabilities.
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We, our executive officers and directors and substantially all of our stockholders have agreed, for a period of 180 days after the date of this prospectus, not to, without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation:
- offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock; or
- enter into any swap or other arrangement that transfers all or a portion of the economic consequences associated with the ownership of any common stock, regardless of whether any of the transactions described in these clauses are to be settled by the delivery of common stock, or such other securities, in cash or otherwise.
The underwriting agreement contains limited exceptions to these lock-up agreements.
In addition, during this 180 day period, we have agreed not to file any registration statement with respect to, and each of our executive officers and directors and a substantially all of our stockholders have agreed not to make any demand for, or exercise any right with respect to, the registration of any shares of common stock or any securities convertible into or exercisable or exchangeable for common stock without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation.
Prior to this offering, there was no established trading market for our common stock. The initial public offering price for our common stock will be determined by negotiation among us and the representatives of the underwriters. The factors to be considered in determining the initial public offering price include:
- the history of and the prospects for the industry in which we compete;
- the ability of our management;
- our past and present operations;
- our prospects for future earnings;
- the general condition of the securities markets at the time of this offering; and
- the recent market prices of securities of generally comparable companies.
Other than in the United States, no action has been taken by us or the underwriters that would permit a public offering of the shares of our common stock offered in this prospectus in any jurisdiction where action for that purpose is required. The shares of our common stock offered in this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any shares of our common stock be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of the jurisdiction. Persons other than in the United States who receive this prospectus are advised to inform themselves about and to observe any restrictions relating to the offering of our common stock and the distribution of this prospectus. This prospectus is not an offer to sell or a solicitation of an offer to buy any shares of our common stock included in this offering in any jurisdiction where that would not be permitted or legal.
In connection with this offering, some underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of our common stock. Specifically, the underwriters may create a syndicate short position by making short sales of our common stock and may purchase our common stock on the open market to cover syndicate short positions created by short sales. Short sales involve the sale by the underwriters of a greater number of shares of common stock than they are required to purchase in the offering. Short sales can be either "covered" or "naked." "Covered" short sales are
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sales made in an amount not greater than the underwriters' over-allotment option to purchase additional shares in the offering. "Naked" short sales are sales in excess of the over-allotment option. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in the offering. The underwriters may close out any covered short positions by either exercising their over-allotment option or purchasing shares in the open market. The underwriters must close out any naked short position by purchasing shares in the open market. In determining the source of shares to close out the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option. The underwriting syndicate may reclaim selling concessions if the syndicate repurchases previously distributed shares of our common stock in syndicate covering transactions, in stabilizing transactions or in some other way if Donaldson, Lufkin & Jenrette Securities Corporation receives a report that indicates clients of such syndicate members have "flipped" the common stock. These activities may have the effect of raising or maintaining the market price of our common stock or preventing or retarding a decline in the market price of our common stock. As a result, the price of our common stock may be higher than the price that might otherwise exist in the open market. The underwriters are not required to engage in these activities and may end any of these activities at any time.
At our request, certain of the underwriters have reserved up to 5% of the shares offered by this prospectus for sale at the initial public offering price to our employees, officers, directors and other individuals associated with us and members of their families. The number of shares of common stock available for sale to the general public will be reduced to the extent any reserved shares are purchased. Any reserved shares not so purchased will be offered by the underwriters on the same basis as the other shares of our common stock. Reserved shares will not be subject to lock-up agreements.
We have applied to have our common stock listed on The New York Stock Exchange under the symbol "GB." In connection with the listing of our common stock on The New York Stock Exchange, the underwriters have undertaken to sell round lots of 100 shares or more to a minimum of 2,000 beneficial owners.
An electronic prospectus is available on the web sites maintained by Merrill Lynch and DLJDIRECT Inc., an affiliate of Donaldson, Lufkin & Jenrette Securities Corporation, respectively. Other than the prospectus in electronic format, the information on the Merrill Lynch and DLJDIRECT Inc. web sites relating to this offering is not a part of this prospectus. All final prospectuses will be delivered to Merrill Lynch's and DLJDIRECT's brokerage customers by regular mail. In addition, DLJDIRECT will be facilitating a portion of the electronic distribution of information relating to this offering through the Internet.
DLJ Merchant Banking Partners II, L.P., DLJ Merchant Banking Partners II-A, L.P., DLJ Offshore Partners II, C.V., DLJ Diversified Partners, L.P., DLJ Diversified Partners-A, L.P., DLJ Millennium Partners, L.P., DLJ Millennium Partners-A, L.P., DLJMB Funding II, Inc., DLJ Investment Partners, L.P., DLJ Investment Funding, Inc., UK Investment Plan 1997 Partners, DLJ EAB Partners, L.P., DLJ First ESC, L.P. and DLJ ESC II, L.P., each of which is an affiliate of Donaldson, Lufkin & Jenrette Securities Corporation, are stockholders of our company. In addition, an affiliate of Merrill Lynch, Pierce, Fenner & Smith Incorporated owns 382,597 shares of our common stock.
In addition, DLJ Merchant Banking Partners II, L.P and its affiliates have the right to appoint a majority of the members of our Board of Directors. DLJ Capital Funding, Inc. acted as syndication agent and is a lender under our bank credit facility. In addition, affiliates of some of the underwriters are lenders under our bank credit facility and will receive proceeds from this offering upon repayment of this indebtedness. Prior to this offering, Donaldson, Lufkin & Jenrette Securities Corporation and its
71

affiliates and employees owned an aggregate of approximately 81% of the issued and outstanding shares of our common stock.
The offering is being conducted in accordance with Rule 2720 of the Conduct Rules of the NASD, which provides that, among other things, when an NASD member distributes securities of a company in which it owns 10% or more of the company's outstanding voting securities, the initial public offering price can be no higher than that recommended by a "qualified independent underwriter" meeting specified standards. In accordance with this requirement, Merrill Lynch, Pierce, Fenner & Smith Incorporated will serve in this role and will recommend a price in compliance with the requirements of Rule 2720. In connection with this offering, Merrill Lynch, Pierce, Fenner & Smith Incorporated, in its role as qualified independent underwriter, has exercised its usual standards of "due diligence" and has reviewed and participated in the preparation of this prospectus and the registration statement of which this prospectus forms a part and will recommend the maximum price at which our common stock may be offered hereby. As compensation for serving as the qualified independent underwriter, we have agreed to pay Merrill Lynch, Pierce, Fenner & Smith Incorporated $5,000.
LEGAL MATTERS
The validity of the issuance of the shares of common stock offered by this prospectus will be passed on for us by Weil, Gotshal & Manges LLP, Houston, Texas. Certain legal matters relating to the common stock offered by this prospectus will be passed on for the underwriters by Akin, Gump, Strauss, Hauer & Feld, L.L.P., New York, New York.
EXPERTS
The consolidated balance sheets of Wilson Greatbatch Technologies, Inc. and subsidiary as of January 1, 1999 and December 31, 1999 and the consolidated statements of operations, stockholders' equity and cash flows for the period from July 11, 1997 to January 2, 1998 and for each of the two years in the period ended December 31, 1999 and the statements of operations, stockholders' equity and cash flows of Wilson Greatbatch Ltd. for the period from January 1, 1997 to July 10, 1997 included in this prospectus and the related financial statement schedule included elsewhere in the registration statement of which this prospectus is a part have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report appearing herein, and are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
The financial statements of Hittman Materials and Medical Components, Inc. at August 7, 1998 and December 31, 1997 and for the period from January 1, 1998 through August 7, 1998 and for the year ended December 31, 1997 have been included herein in reliance upon the report of Grant Thornton LLP, independent public accountants, appearing elsewhere herein and given on the authority of said firm as experts in auditing and accounting in giving said report.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the Securities and Exchange Commission a registration statement on Form S-1 under the Securities Act relating to the common stock being sold in this offering. This prospectus constitutes a part of that registration statement. This prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedules to the registration statement because some parts have been omitted in accordance with the rules and regulations of the Commission. For further information about us and the common stock being sold in this offering, you should refer to the registration statement and the exhibits and schedules filed as a part of the registration statement. Statements contained in this prospectus regarding the contents of any agreement, contract or other document referred to are not necessarily complete. Reference is made in each instance to the copy of the contract or document filed as an exhibit to the registration statement. Each statement is qualified
72

by reference to the exhibit. The registration statement, including related exhibits and schedules, may be inspected without charge at the Commission's principal office in Washington, D.C. Copies of all or any part of the registration statement may be obtained after payment of fees prescribed by the Commission from:
- the Commission's Public Reference Room at the Commission's principal office, 450 Fifth Street, N.W., Washington, D.C. 20549; or
- the Commission's regional offices in:
- New York, located at 7 World Trade Center, Suite 1300, New York, New York 10048; or
- Chicago, located at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
You may obtain information regarding the operation of the Public Reference Room by calling the Commission at 1-800-SEC-0330. The Commission maintains a web site that contains reports, proxy and information statements and other information regarding registrants, including us, that file electronically with the Commission. The address of the web site is WWW.SEC.GOV.
We intend to furnish holders of our common stock with annual reports containing audited financial statements certified by an independent public accounting firm and quarterly reports containing unaudited condensed financial information for the first three quarters of each fiscal year. We intend to furnish other reports as we may determine or as may be required by law.
73

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY AND
  WILSON GREATBATCH LTD.:

  Independent Auditors' Report..............................  F-2

  Consolidated Balance Sheets as of January 1, 1999 and
    December 31, 1999.......................................  F-3

  Statement of Operations for the period from January 1,
    1997 to July 10, 1997 and Consolidated Statements of
    Operations for the period from July 11, 1997 to January
    2, 1998 and the years ended January 1, 1999 and December
    31, 1999................................................  F-4

  Statement of Stockholders' Equity for the period from
    January 1, 1997 to July 10, 1997 and Consolidated
    Statements of Stockholders' Equity for the period from
    July 11, 1997 to January 2, 1998 and for the years ended
    January 1, 1999 and December 31, 1999...................  F-5

  Statement of Cash Flows for the period from January 1,
    1997 to July 10, 1997 and Consolidated Statements of
    Cash Flows for the period from July 11, 1997 to January
    2, 1998 and for the years ended January 1, 1999 and
    December 31, 1999.......................................  F-6

  Notes to Financial Statements for the period from January
    1, 1997 to July 10, 1997 and Consolidated Financial
    Statements for the period from July 11, 1997 to January
    2, 1998 and for the years ended January 1, 1999 and
    December 31, 1999.......................................  F-7

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.:

  Report of Independent Certified Public Accountants........  F-28

  Balance Sheets as of August 7, 1998 and December 31,
    1997....................................................  F-29

  Statements of Operations for the period from January 1,
    1998 through August 7, 1998 and for the year ended
    December 31, 1997.......................................  F-30

  Statements of Stockholder's Equity for the period from
    January 1, 1998 through August 7, 1998 and for the year
    ended December 31, 1997.................................  F-31

  Statements of Cash Flows for the period from January 1,
    1998 through August 7, 1998 and for the year ended
    December 31, 1997.......................................  F-32

  Notes to Financial Statements for the period from January
    1, 1998 through August 7, 1998 and for the year ended
    December 31, 1997.......................................  F-33	

F-1

INDEPENDENT AUDITORS' REPORT
Board of Directors and Stockholders
Wilson Greatbatch Technologies, Inc.
Clarence, New York
We have audited the accompanying consolidated balance sheets of Wilson Greatbatch Technologies, Inc. and subsidiary (the "Company") as of December 31, 1999 and January 1, 1999, and the related consolidated statements of operations, stockholders' equity, and cash flows for the period from July 11, 1997 (date of organization) to January 2, 1998 and for each of the two years in the period ended December 31, 1999. We have also audited the statements of operations, stockholders' equity and cash flows of Wilson Greatbatch Ltd. (the "Predecessor") for the period from January 1, 1997 to July 10, 1997. Our audits also included the financial statement schedule listed in the Index at Item 16(B) of the registration statement. These financial statements and financial statement schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Wilson Greatbatch Technologies, Inc. and subsidiary as of December 31, 1999 and January 1, 1999, and the results of their operations and their cash flows for the period from July 11, 1997 to January 2, 1998 and for each of the two years in the period ended December 31, 1999 and the results of operations and cash flows of Wilson Greatbatch Ltd. for the period from January 1, 1997 to July 10, 1997 in conformity with generally accepted accounting principles. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth therein.
As discussed in Note 2 to the consolidated financial statements, in 1999, the Company changed its method of accounting for the costs of start-up activities.
DELOITTE & TOUCHE LLP
Buffalo, New York
January 21, 2000
(March 14, 2000 as to Note 18 and August 15, 2000 as to the effects of the reverse stock splits described in Note 1)
F-2

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)

                                                             JANUARY 1,   DECEMBER 31,    JUNE 30,
                                                                1999          1999          2000
                                                             ----------   ------------   -----------
                                                                                         (UNAUDITED)
ASSETS
CURRENT ASSETS:
  Cash and cash equivalents................................   $  4,140      $  3,863       $  2,453
  Accounts receivable, net of allowance for doubtful
    accounts of $197 and $219 as of January 1, 1999 and
    December 31, 1999, respectively........................     11,963        11,016         11,677
  Inventories..............................................     13,291        13,583         13,770
  Prepaid expenses and other assets........................        227           868          1,093
  Refundable income taxes..................................        698         2,520            727
  Deferred tax asset.......................................      1,669         1,520          1,520
                                                              --------      --------       --------
    Total current assets...................................     31,988        33,370         31,240

PROPERTY, PLANT AND EQUIPMENT, NET.........................     29,495        33,557         34,180
INTANGIBLE ASSETS, NET.....................................    120,900       112,902        109,255
DEFERRED TAX ASSET.........................................      8,988         7,828          7,828
OTHER ASSETS...............................................      3,019         2,122          1,858
                                                              --------      --------       --------
TOTAL ASSETS...............................................   $194,390      $189,779       $184,361
                                                              ========      ========       ========

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
  Accounts payable.........................................   $  2,134      $  2,385       $  2,484
  Accrued liabilities......................................     14,148         7,139          8,798
  Current maturities of long-term obligations..............      2,950         6,225          7,475
                                                              --------      --------       --------
    Total current liabilities..............................     19,232        15,749         18,757

LONG-TERM OBLIGATIONS......................................    128,336       126,988        119,398
DEFERRED COMPENSATION......................................      1,227           635            645
                                                              --------      --------       --------
    Total liabilities......................................    148,795       143,372        138,800
                                                              --------      --------       --------

COMMITMENTS AND CONTINGENCIES (NOTE 13)

STOCKHOLDERS' EQUITY:
  Common stock.............................................         12            12             12
  Subscribed common stock..................................      1,684         1,684          1,684
  Capital in excess of par value...........................     60,295        63,488         63,488
  Retained deficit.........................................    (14,712)      (16,984)       (17,760)
                                                              --------      --------       --------
    Subtotal...............................................     47,279        48,200         47,424
  Less treasury stock, at cost.............................         --          (109)          (179)
  Less subscribed common stock receivable..................     (1,684)       (1,684)        (1,684)
                                                              --------      --------       --------
    Total stockholders' equity.............................     45,595        46,407         45,561
                                                              --------      --------       --------

  TOTAL LIABILITIES AND STOCKHOLDERS'
    EQUITY.................................................   $194,390      $189,779       $184,361
                                                              ========      ========       ========	

See notes to consolidated financial statements.
F-3

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

                                           WILSON
                                       GREATBATCH LTD.
                                        (PREDECESSOR)
                                          (NOTE 1)                         WILSON GREATBATCH TECHNOLOGIES, INC.
                                       ---------------    -----------------------------------------------------------------------
                                                                                                               SIX MONTHS
                                         JANUARY 1,                                YEAR ENDED                     ENDED
                                            1997           JULY 11, 1997    -------------------------   -------------------------
                                             TO                 TO          JANUARY 1,   DECEMBER 31,     JULY 2,      JUNE 30,
                                        JULY 10, 1997     JANUARY 2, 1998      1999          1999          1999          2000
                                       ---------------    ---------------   ----------   ------------   -----------   -----------
                                                                                                        (UNAUDITED)   (UNAUDITED)
REVENUES.............................      $30,468            $ 27,193       $77,361       $79,235        $38,318       $46,584
COST OF GOODS SOLD...................       14,922              12,241        36,454        41,057         19,385        26,385
                                           -------            --------       -------       -------        -------       -------
GROSS PROFIT.........................       15,546              14,952        40,907        38,178         18,933        20,199
SELLING, GENERAL AND ADMINISTRATIVE
  EXPENSES...........................        6,729               5,412        11,484         9,880          5,124         5,132
RESEARCH, DEVELOPMENT AND ENGINEERING
  COSTS, NET.........................        4,400               4,619        12,190         9,339          5,130         5,046
INTANGIBLE AMORTIZATION..............           --               1,810         5,197         6,510          3,266         3,267
TRANSACTION RELATED EXPENSES.........       11,097                  --            --            --             --            --
WRITE-OFF OF PURCHASED IN-PROCESS
  RESEARCH, DEVELOPMENT AND
  ENGINEERING........................           --              23,779            --            --             --            --
                                           -------            --------       -------       -------        -------       -------
                                            (6,680)            (20,668)       12,036        12,449          5,413         6,754
INTEREST EXPENSE.....................          252               4,128        10,572        13,420          6,519         7,787
OTHER (INCOME) EXPENSE...............         (117)                 74           364         1,343            129            71
                                           -------            --------       -------       -------        -------       -------
INCOME (LOSS) BEFORE INCOME TAXES AND
  CUMULATIVE EFFECT OF ACCOUNTING
  CHANGE.............................       (6,815)            (24,870)        1,100        (2,314)        (1,235)       (1,104)
INCOME TAX EXPENSE (BENEFIT).........        1,053              (9,468)          410          (605)          (321)         (328)
                                           -------            --------       -------       -------        -------       -------
INCOME (LOSS) BEFORE CUMULATIVE
  EFFECT OF ACCOUNTING CHANGE........       (7,868)            (15,402)          690        (1,709)          (914)         (776)
CUMULATIVE EFFECT OF ACCOUNTING
  CHANGE, NET OF TAX (Note 2)........           --                  --            --          (563)          (563)           --
                                           -------            --------       -------       -------        -------       -------
NET INCOME (LOSS)....................      $(7,868)           $(15,402)      $   690       $(2,272)       $(1,477)      $  (776)
                                           =======            ========       =======       =======        =======       =======
BASIC EARNINGS (LOSS) PER SHARE
  Before cumulative effect of
    accounting change................      $  (874)           $  (1.74)      $  0.07       $ (0.14)       $ (0.07)      $ (0.06)
  Basic earnings (loss) per share....      $  (874)           $  (1.74)      $  0.07       $ (0.18)       $ (0.12)      $ (0.06)
DILUTED EARNINGS (LOSS) PER SHARE
  Before cumulative effect of
    accounting change................      $  (874)           $  (1.74)      $  0.06       $ (0.14)       $ (0.07)      $ (0.06)
  Diluted earnings (loss) per
    share............................      $  (874)           $  (1.74)      $  0.06       $ (0.18)       $ (0.12)      $ (0.06)
WEIGHTED AVERAGE SHARES OUTSTANDING
  Basic..............................            9               8,855        10,461        12,491         12,406        12,615
  Diluted............................            9               8,855        10,677        12,491         12,406        12,615	

See notes to consolidated financial statements.
F-4

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(DOLLARS IN THOUSANDS EXCEPT SHARES)

                                                           SUBSCRIBED      CAPITAL                 TREASURY     SUBSCRIBED
                                        COMMON STOCK      COMMON STOCK    IN EXCESS  RETAINED       STOCK         COMMON
                                     ------------------  ---------------   OF PAR    EARNINGS   --------------    STOCK
                                       SHARES    AMOUNT  SHARES   AMOUNT    VALUE    (DEFICIT)  SHARES  AMOUNT  RECEIVABLE
                                     ----------  ------  -------  ------  ---------  ---------  ------  ------  ----------
Wilson Greatbatch Ltd.
  (Predecessor) (Note 1):
BALANCE, JANUARY 1, 1997...........       8,839   $  9        --  $  --    $    --   $ 12,235      --    $ --     $   --
  Net loss.........................          --     --        --     --         --     (7,868)     --      --         --
  Dividends declared...............          --     --        --     --         --     (1,130)     --      --         --
  Cash distributions to
    shareholders...................          --     --        --     --         --     (1,119)     --      --         --
  Other distribution to
    shareholders...................          --     --        --     --         --     (2,182)     --      --         --
                                     ----------   ----   -------  ------   -------   --------   ------   ----     ------
BALANCE, JULY 10, 1997.............       8,839   $  9        --  $  --    $    --   $    (64)     --    $ --     $   --
                                     ==========   ====   =======  ======   =======   ========   ======   ====     ======
--------------------------------------------------------------------------------------------------------------------------
Wilson Greatbatch Technologies, Inc.:
BEGINNING BALANCE, JULY 10,
  1997.............................          --   $ --        --  $  --    $    --   $     --      --    $ --     $   --
  Capitalization of the Company....   8,594,662      9        --     --     42,964         --      --      --         --
  Common stock issued..............     133,600     --        --     --        668         --      --      --         --
  Subscribed common stock..........          --     --   336,800  1,684         --         --      --      --      1,684
  Net loss.........................          --     --        --     --         --    (15,402)     --      --         --
                                     ----------   ----   -------  ------   -------   --------   ------   ----     ------
BALANCE, JANUARY 2, 1998...........   8,728,262      9   336,800  1,684     43,632    (15,402)     --      --      1,684
  Shares issued in connection with
    the financing of Greatbatch-
    Hittman........................   3,300,000      3        --     --     16,497         --      --      --         --
  Shares issued under Employee
  Stock Ownership Plan.............      25,231     --        --     --        126         --      --      --         --
  Exercise of stock options........       7,960     --        --     --         40         --      --      --         --
  Net income.......................          --     --        --     --         --        690      --      --         --
                                     ----------   ----   -------  ------   -------   --------   ------   ----     ------
BALANCE, JANUARY 1, 1999...........  12,061,453     12   336,800  1,684     60,295    (14,712)     --      --      1,684
  Common stock issued..............      66,537     --        --     --        998         --      --      --         --
  Shares issued under Employee
    Stock Ownership Plan...........     139,470     --        --     --      2,092         --      --      --         --
  Exercise of stock options........      20,668     --        --     --        103         --      --      --         --
  Purchase of common stock from
    former employees...............          --     --        --     --         --         --   7,285     109         --
  Net loss.........................          --     --        --     --         --     (2,272)     --      --         --
                                     ----------   ----   -------  ------   -------   --------   ------   ----     ------
BALANCE, DECEMBER 31, 1999.........  12,288,128   $ 12   336,800  $1,684   $63,488   $(16,984)  7,285    $109     $1,684
                                     ==========   ====   =======  ======   =======   ========   ======   ====     ======	

See notes to consolidated financial statements.
F-5

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)

                                     WILSON
                                 GREATBATCH LTD.
                              (PREDECESSOR)(NOTE 1)                      WILSON GREATBATCH TECHNOLOGIES, INC.
                              ---------------------   ---------------------------------------------------------------------------
                                   PERIOD FROM          PERIOD FROM        YEAR          YEAR        SIX MONTHS      SIX MONTHS
                                 JANUARY 1, 1997       JULY 11, 1997      ENDED         ENDED           ENDED           ENDED
                                       TO                   TO          JANUARY 1,   DECEMBER 31,      JULY 2,        JUNE 30,
                                  JULY 10, 1997       JANUARY 2, 1998      1999          1999           1999            2000
                              ---------------------   ---------------   ----------   ------------   -------------   -------------
                                                                                                     (UNAUDITED)     (UNAUDITED)
CASH FLOWS FROM OPERATING
  ACTIVITIES:
Net income (loss)...........         $(7,868)            $ (15,402)      $   690       $(2,272)         (1,477)           (776)
Adjustments to reconcile net
  income (loss) to net cash
  provided by (used in)
  operating activities:
  Purchased in-process
    research and
    development.............              --                23,779            --            --              --              --
  Depreciation and
    amortization............           1,456                 3,548         9,190        11,363           5,911           6,243
  Deferred financing
    costs...................              --                   248           699           972             448             465
  Deferred compensation.....          (1,616)                1,164          (824)         (592)           (302)           (339)
  Deferred income taxes.....              --                (9,750)         (907)        1,685             103              --
  Loss on disposal of
    assets..................             530                     6           194           146              --              --
  Valuation loss on
    investment held at
    cost....................              --                    --            --           859              --              --
  Cumulative effect of
    accounting change.......              --                    --            --           563             563              --
  Reserve for disposal of
    property................              --                    --           300            --              --              --
Changes in operating assets
  and liabilities:
  Accounts receivable.......          (1,132)                1,766        (4,223)          947           2,026            (661)
  Inventories...............           1,082                (1,871)         (629)         (292)            558            (187)
  Prepaid expenses and other
    assets..................             202                   119           (57)         (663)           (686)          1,568
  Accounts payable..........             688                    68          (103)          251            (886)             99
  Accrued liabilities.......           1,073                 1,097         5,507        (4,241)         (2,318)          2,347
  Income taxes..............              --                   222          (910)       (1,826)            120            (342)
                                     -------             ---------       -------       -------         -------         -------
    Net cash (used in)
      provided by operating
      activities............          (5,585)                4,994         8,927         6,900           4,060           8,417
                                     -------             ---------       -------       -------         -------         -------
CASH FLOWS FROM INVESTING
  ACTIVITIES:
  Acquisition of property,
    plant and equipment.....          (1,934)               (2,656)       (6,207)       (8,452)         (3,578)         (3,240)
  Proceeds from sale of
    property, plant and
    equipment...............              --                    --            80             5              --              --
  Increase in intangible
    assets..................              --                  (850)       (1,741)         (570)           (304)           (267)
  Decrease (increase) in
    other long term
    assets..................              --                  (147)       (2,569)          170              --              --
  Acquisition of subsidiary,
    net of cash acquired....              --                    --       (72,938)           --              --              --
                                     -------             ---------       -------       -------         -------         -------
    Net cash used in
      investing
      activities............          (1,934)               (3,653)      (83,375)       (8,847)         (3,882)         (3,507)
                                     -------             ---------       -------       -------         -------         -------
CASH FLOWS FROM FINANCING
  ACTIVITIES:
  Borrowings (repayments)
    under line of credit,
    net.....................          11,677                   200          (700)        4,300              --          (3,200)
  Proceeds from long-term
    debt....................            (488)               (1,800)       61,853            --              --              --
  Proceeds from debt and
    equity financing
    (Note 1)................              --               115,285            --            --              --              --
  Payments to acquire
    Predecessor (Note 1)....              --              (115,285)           --            --              --              --
  Equity investment in
    Company.................              --                   668            --            --              --              --
  Scheduled payments of
    long-term debt..........              --                    --          (775)           --              --          (3,050)
  Prepayments of long-term
    debt....................              --                    --          (775)       (2,950)         (2,950)             --
  Acquisition earnout
    payment.................              --                    --            --        (2,764)             --              --
  Cash dividends paid.......            (920)                   --            --            --              --              --
  Cash distributions to
    shareholders............          (2,419)                   --            --            --              --              --
  Purchase of treasury
    stock...................              --                    --            --          (109)             --             (70)
  Issuance of capital
    stock...................              --                    --        16,666         3,193              92              --
                                     -------             ---------       -------       -------         -------         -------
    Net cash provided by
      (used in) financing
      activities............           7,850                  (932)       76,269         1,670          (2,858)         (6,320)
                                     -------             ---------       -------       -------         -------         -------
NET INCREASE (DECREASE) IN
  CASH AND CASH
  EQUIVALENTS...............             331                   409         1,821          (277)         (2,680)         (1,410)
CASH AND CASH EQUIVALENTS,
  BEGINNING OF PERIOD.......              54                 1,910         2,319         4,140           4,140           3,863
                                     -------             ---------       -------       -------         -------         -------
CASH AND CASH EQUIVALENTS,
  END OF PERIOD.............         $   385             $   2,319       $ 4,140       $ 3,863           1,460           2,453
                                     =======             =========       =======       =======         =======         =======	

See notes to consolidated financial statements.
F-6

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
1. DESCRIPTION OF BUSINESS
THE ENTITY--The consolidated financial statements include the accounts of Wilson Greatbatch Technologies, Inc., a holding company, and its wholly-owned subsidiary Wilson Greatbatch Ltd. (collectively, the "Company"). The Company is comprised of its operating companies, Wilson Greatbatch Ltd. and its wholly-owned subsidiary, Greatbatch-Hittman, Inc. ("Hittman"). All significant intercompany balances and transactions have been eliminated.
On July 10, 1997, the Company acquired all of the outstanding shares of Wilson Greatbatch Ltd. (the "Predecessor") in a leveraged buyout. Equity financing was provided by entities affiliated with DLJ Merchant Banking Partners II, L.P. ("DLJMB"), an affiliate of Donaldson, Lufkin and Jenrette Securities Corporation ("DLJ"). DLJMB acquired approximately 86.4% of the outstanding capital stock of the Company. Debt financing was provided by a variety of lenders, including DLJ Capital Funding, Inc., also an affiliate of DLJ.
The leveraged buyout was accounted for under the purchase method of accounting. Accordingly, the $115.3 million purchase price was allocated to the net assets acquired based on their estimated fair values. The excess of purchase price over fair value of the net tangible assets acquired was $79.1 million of which $23.8 million was allocated to purchased in-process research, development and engineering and $55.3 million was allocated to other intangible assets. The purchased in-process research, development and engineering were immediately charged to expense upon acquisition. Other intangible assets included the following (dollars in thousands):

Goodwill....................................................  $ 6,124
Trademark and Names.........................................   22,860
Patented Technology.........................................   13,990
License Agreement...........................................    6,190
Assembled Workforce.........................................    6,180
                                                              -------
    Total...................................................  $55,344
                                                              =======	

F-7

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
1. DESCRIPTION OF BUSINESS (CONTINUED) In-process research, development and engineering included the following (dollars in thousands):

                                                  YEAR WHEN
                                                  MATERIAL NET     RISK-
                                                  CASH IN-FLOWS   ADJUSTED
                                                  EXPECTED TO     DISCOUNT
                                                   BEGIN            RATE
                                                      ----         -------
Medical:
  Capacitor.....................................      1998             20%      $4,036
  Next Generation ICD...........................      1998             35%       7,004
  Titanium Carbon Monofluoride..................      1998             20%       1,204
  High Value Carbon Monofluoride Cell...........      1999             20%         397
  Lithium Ion Products..........................      1999             35%       3,216
  Pharmatarget & Minimed
    Project (09 Pump)...........................      1998             35%       2,253
  Other.........................................      1999             N/A         640

Commercial:
  200 Degree Cell & MWD DD Cell.................      1998             20%         305

Greatbatch Scientific:
  Medical Products..............................      1998             35%       4,724
                                                                               -------
                                                                               $23,779
                                                                               =======	

A brief description of the nature of the significant acquired in-process research, development and engineering projects are as follows:
Capacitors--The objective of this project was to develop capacitors that deliver twice the energy density of aluminum electrolytic capacitors to facilitate a significant reduction in the size of ICDs.
Next Generation ICD--The objective of this project was to develop several proprietary process improvements to reduce the size of the ICD battery, while at the same time delivering more energy density than products sold at the time.
Titanium Carbon Monofluoride--The objective of this project was to reduce the size and weight of batteries used in pacemaker devices.
Lithium Ion Products--The objective of this project was to develop and manufacture rechargeable lithium ion batteries, suitable for use in implantable medical devices.
Pharmatarget & Minimed Project (09 Pump)--The objective of this project was to develop a more efficient and less costly pump for implantable medical devices.
Greatbatch Scientific--The objective of this project was the development of battery-powered surgical devices, which were magnetic resonance imaging, or MRI, compatible, to develop a new product line, a new customer base and a new outlet for our already-existing batteries.
F-8

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
1. DESCRIPTION OF BUSINESS (CONTINUED) The above-noted technology refers to the product development activities related to the design and manufacture of future Company products. It includes those products or product enhancements which management believes were currently in development and were part of the Company's strategy to increase its dominance of the implantable defibrillators and pacemaker battery market. Such in-process technology was determined by management to have no alternative future use. To value the in-process technology, management of the Company utilized the discounted cash flow method.
The statements of operations, stockholders' equity and cash flows and the notes to the financial statements include activity separately identified for the period from January 1, 1997 to July 10, 1997 that pertain to the Predecessor.
In connection with the leveraged buyout, approximately $11.1 million of nonrecurring costs and expenses were incurred and charged to expense by Predecessor for the period from January 1, 1997 to July 10, 1997. These nonrecurring costs and expenses include the following: (a) payments totaling $4.9 million made to employees and Board members pursuant to the leveraged buyout agreement; (b) payments totaling $5.6 million representing commissions and fees as a result of the sale of Predecessor; and (c) the write-off of $0.6 million of construction in progress.
NATURE OF OPERATIONS--The Company operates in two reportable segments--medical and commercial power sources. The medical segment designs and manufactures power sources, capacitors and components used in implantable medical devices. The commercial power sources segment designs and manufactures non-medical power sources for use in aerospace, oil and gas exploration and oceanographic equipment.
On May 18, 2000, the Board of Directors authorized a one for three reverse stock split to holders of record on May 19, 2000. On August 15, 2000, the Board of Directors authorized a three for five reverse stock split to holders of record on August 15, 2000. All share and per share data, including stock option information for the Company, has been restated to reflect the reverse stock splits.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INTERIM FINANCIAL STATEMENTS--The accompanying consolidated balance sheet as of June 30, 2000, statements of operations and cash flows for the six months ended July 2, 1999 and June 30, 2000 are unaudited but, in the opinion of management, include all adjustments (consisting of normal, recurring adjustments) necessary for a fair presentation for results of these interim periods. The results of operations for the six months ended June 30, 2000 are not necessarily indicative of results to be expected for the entire year or for any other period.
ACCOUNTING CHANGE--In April 1998, the AICPA issued Statement of Position ("SOP") 98-5, "Reporting the Costs of Start-Up Activities." This statement requires that start-up costs, including organization costs, capitalized by the Company prior to January 2, 1999, be written off and any future start-up costs be expensed as incurred. The Company adopted this SOP in 1999. The total amount of deferred start-up costs reported as a cumulative effect of change in accounting principle was $939,000, net of tax benefits of $376,000.
F-9

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) CASH AND CASH EQUIVALENTS--Cash and cash equivalents consist of cash and highly liquid, short-term investments with maturities of three months or less.
INVENTORIES--Inventories include raw materials, work-in-process and finished goods and are stated at the lower of cost (as determined by the first-in, first-out method) or market.
PROPERTY, PLANT AND EQUIPMENT--Property, plant and equipment is carried at cost. Depreciation is computed primarily by the straight-line method over the estimated useful lives of the assets, which are as follows: buildings and building improvements 7-40 years; machinery and equipment 3-10 years; office equipment 3-10 years; and leasehold improvements over the remaining lives of the improvements or the lease term, if less.
The cost of repairs and maintenance is charged to expense as incurred. Renewals and betterments are capitalized. Upon retirement or sale of an asset, its cost and related accumulated depreciation or amortization are removed from the accounts and any gain or loss is recorded in income or expense. The Company continually reviews plant and equipment to determine that the carrying values have not been impaired.
INTANGIBLE ASSETS--Intangible assets include goodwill and other identifiable intangible assets, which were derived in connection with the Company's acquisition of the Predecessor and Hittman. Goodwill represents the excess of the purchase price over the fair value of the net assets acquired. Goodwill is being amortized on a straight-line basis over 40 years. Other identifiable intangible assets are being amortized on a straight-line basis over their estimated useful lives ranging from 6 to 40 years, except for deferred financing costs which are being amortized using the effective yield method over the life of the underlying debt. The Company continually reviews these intangible assets for potential impairment by assessing significant decreases in the market value, a significant change in the extent or manner in which an asset is used or a significant adverse change in the business climate. The Company measures expected future cash flows and compares to the carrying amount of the asset to determine whether any impairment loss is to be recognized.
FAIR VALUE OF FINANCIAL INSTRUMENTS--The fair value of financial instruments is determined by reference to various market data and other valuation techniques, as appropriate. Unless otherwise disclosed, the fair value of cash and cash equivalents approximates their recorded values due to the nature of the instruments. The floating rate debt carrying value approximates the fair value based using the floating interest rate resetting on a regular basis. The fixed rate long-term debt carrying value approximates fair value.
The fair value of the interest rate cap agreements are estimated by obtaining quotes from brokers and represents the cash requirement if the existing contract has been settled at year end. The notional amount, fair value and carrying amount of the Company's interest rate cap agreements were approximately $54.1 million and $79.1 million; $196,000 and $515,300; and $254,500 and $229,100, as of January 1, 1999 and December 31, 1999, respectively.
CONCENTRATION OF CREDIT RISK--Financial instruments which potentially subject the Company to concentration of credit risk consist principally of trade receivables. A significant portion of the Company's sales are to customers in the medical industry, and, as such, the Company is directly
F-10

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) affected by the condition of that industry. However, the credit risk associated with trade receivables is minimal due to the Company's stable customer base and ongoing control procedures, which monitor the creditworthiness of customers.
The credit risk associated with the Company's interest rate cap agreements is not considered significant due to the creditworthiness of the counterparties.
DERIVATIVE FINANCIAL INSTRUMENTS--The Company has only limited involvement with derivative financial instruments and does not enter into financial instruments for trading purposes. Interest rate cap agreements are used to reduce the potential impact of increases in interest rates on floating-rate long-term debt. Premiums paid for purchased interest rate cap agreements are amortized over the terms of the caps and recognized as interest expense. Unamortized premiums are included in other assets in the consolidated balance sheets. Amounts receivable under interest rate cap agreements are accrued as a reduction of interest expense. At December 31, 1999, the Company was a party to three interest rate cap agreements (see Note 8).
STOCK OPTION PLAN--The Company accounts for stock-based compensation in accordance with Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation." As permitted in that standard, the Company has chosen to account for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board No. 25, "Accounting for Stock Issued to Employees," and related interpretations. In the absence of a "regular, active public market," the fair market value of the common stock has been determined by the Board of Directors. The most recent independent valuation of the Company stock was performed in May 1999 as of December 31, 1998.
INCOME TAXES--The Company provides for income taxes using the liability method whereby deferred tax liabilities and assets are recognized based on temporary differences between the financial reporting and tax basis of assets and liabilities using the anticipated tax rate when taxes are expected to be paid or reversed.
REVENUE RECOGNITION--Revenues are recognized when the products are shipped to customers.
RESEARCH, DEVELOPMENT AND ENGINEERING COSTS--Research, development and engineering costs are expensed as incurred. The Company recognizes cost reimbursements from customers for whom the Company designs products upon achieving milestones related to designing batteries and capacitors for their products. The cost reimbursements charged to customers represent actual costs incurred by the Company in the design and testing of prototypes built to customer specifications. This cost reimbursement includes no mark-up and is recorded as an offset to research, development and engineering costs.
F-11

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Net research, development and engineering costs for the periods from January 1, 1997 to July 10, 1997 and July 11, 1997 to January 2, 1998 and the years ended January 1, 1999 and December 31, 1999 are as follows (dollars in thousands):

                                                      PREDECESSOR
                                                    ---------------
                                                    JANUARY 1, 1997    JULY 11, 1997
                                                          TO                TO
                                                     JULY 10, 1997    JANUARY 2, 1998     1998       1999
                                                    ---------------   ---------------   --------   --------
Gross research, development and engineering
  costs...........................................      $5,980             $5,765       $15,580    $11,885
Less cost reimbursements..........................      (1,580)            (1,146)       (3,390)    (2,546)
                                                        ------             ------       -------    -------
Research, development and engineering costs,
  net.............................................      $4,400             $4,619       $12,190    $ 9,339
                                                        ======             ======       =======    =======	

EARNINGS (LOSS) PER SHARE ("EPS")--Basic earnings per share is calculated by dividing net income (loss) by the average number of shares outstanding during the period. Diluted earnings per share is calculated by adjusting for common stock equivalents, which consist of stock options. During the period from July 11, 1997 to January 2, 1998 there were no dilutive stock options. During the year ended December 31, 1999, there were approximately 0.2 million stock options that were not included in the computation of diluted EPS because to do so would have been antidilutive. Diluted earnings per share for the year ended January 1, 1999 includes the potentiality dilutive effect of stock options. All shares held in the Employee Stock Ownership Plan are considered outstanding for both basic and diluted earnings (loss) per share calculations. For the period from January 1, 1997 to July 10, 1997, the Predecessor was a subchapter S corporation and therefore EPS has not been included.
COMPREHENSIVE INCOME--Comprehensive income includes all changes in stockholders' equity during a period except those resulting from investments by owners and distribution to owners. For all periods presented, the Company's only component of comprehensive income is its net income (loss) for those periods.
USE OF ESTIMATES--The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
RECENT ACCOUNTING PRONOUNCEMENTS--The Company adopted SFAS No. 131, "Disclosures About Segments of an Enterprise and Related Information," in 1999. SFAS No. 131 establishes standards for reporting information about operating and related disclosures about products and services, geographical areas and major customers. The adoption of SFAS No. 131 did not effect the Company's financial position, results of operations or cash flows, but did affect the disclosure of segment information.
In June 1998, the Financial Accounting Standards Board issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activity," which, as amended, is required to be adopted by the Company in 2001. The Statement will require the Company to recognize all derivatives on the balance sheet at fair value. Derivatives that are not hedges of underlying transactions must be adjusted to fair value through income. If the derivative is a hedge, depending on the nature of the hedge, changes in
F-12

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) the fair value of derivatives will either be offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings or recognized in other comprehensive income until the hedged item is recognized in earnings. The ineffective portion of a derivative's change in fair value will be immediately recognized in earnings. Management has not yet determined the effect SFAS No. 133 will have, if any, on the Company's consolidated financial position, results of operations or cash flows.
SUPPLEMENTAL CASH FLOW INFORMATION--Cash paid for interest from January 1, 1997 to July 10, 1997, from July 11, 1997 to January 2, 1998, in 1998 and 1999 was approximately $275,000, $1,992,000, $9,150,000 and $13,790,000, respectively. Cash paid for income taxes from January 1, 1997 to July 10, 1997, from July 11, 1997 to January 2, 1998, in 1998 and 1999 was approximately $17,000, $-0-, $1,482,000 and $186,000, respectively.
FINANCIAL STATEMENT YEAR END--The Company's year end is the closest Friday to December 31. Fiscal 1999 and 1998 included 52 weeks.
3. ACQUISITION
On August 7, 1998, Wilson Greatbatch Ltd. acquired all of the issued and outstanding shares of Hittman, formerly Hittman Materials and Medical Components, Inc., for a total purchase price of $71.8 million. Of the total purchase price, $69.0 million was paid in cash at the date of acquisition. The remaining purchase price was contingent upon Hittman achieving certain financial targets in 1998 and 1999. Approximately $2.8 million of the contingent consideration was incurred in fiscal 1998, paid in 1999, and allocated to the purchase price. There is no additional contingent consideration to be incurred.
The acquisition was recorded under the purchase method of accounting and accordingly, the results of the operations of Hittman have been included in the consolidated financial statements from the date of acquisition. The purchase price has been allocated to assets acquired and liabilities assumed based on the fair value at the date of acquisition. The excess of the purchase price over fair value of the net assets acquired was approximately $67.7 million, of which $17.4 million was allocated to identifiable intangible assets and $50.3 million was allocated to goodwill. Identifiable intangible assets included the following (dollars in thousands):

Hittman Trademark...........................................  $ 6,800
Proprietary Technology......................................    3,200
Noncompetition/Employment Agreements........................    5,600
Assembled Workforce.........................................    1,200
Other.......................................................      600
                                                              -------
    Total...................................................  $17,400
                                                              =======	

F-13

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
4. INVENTORIES
Inventories consisted of the following (dollars in thousands):

                                             JANUARY 1,   DECEMBER 31,    JUNE 30,
                                                1999          1999          2000
                                             ----------   ------------   -----------
                                                                         (UNAUDITED)
Raw material...............................    $ 6,033       $ 7,099       $ 6,913
Work-in-process............................      6,016         5,089         5,088
Finished goods.............................      1,242         1,395         1,769
                                               -------       -------       -------
Total......................................    $13,291       $13,583       $13,770
                                               =======       =======       =======	

5. PROPERTY, PLANT AND EQUIPMENT, NET
Property, plant, and equipment consisted of the following (dollars in thousands):

                                                        JANUARY 1,   DECEMBER 31,
                                                           1999          1999
                                                        ----------   ------------
Land and land improvements............................    $ 2,227       $ 2,227
Buildings and building improvements...................      4,974         5,226
Leasehold improvements................................      1,348         2,243
Machinery and equipment...............................     20,630        26,153
Furniture and fixtures................................      1,552         1,628
Computers and information technology..................      1,893         2,259
Other.................................................      1,749         2,863
                                                          -------       -------
                                                           34,373        42,599
Less accumulated depreciation.........................     (4,878)       (9,042)
                                                          -------       -------
Total.................................................    $29,495       $33,557
                                                          =======       =======	

Depreciation expense for the period from January 1, 1997 to July 11, 1997, from July 11, 1997 to January 2, 1998 in 1998 and 1999 was approximately $1,441,000, $1,586,000, $3,532,000 and $4,240,000, respectively.
F-14

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
6. INTANGIBLE ASSETS, NET
Intangible assets consisted of the following (dollars in thousands):

                                                              JANUARY 1,   DECEMBER 31,
                                                                 1999          1999
                                                              ----------   ------------
Goodwill, net of accumulated amortization of $824 and
  $2,229....................................................   $ 55,028      $ 53,944
Trademark and names, net of accumulated amortization of $944
  and $1,685................................................     28,817        27,975
Patented technology, net of accumulated amortization of
  $1,696 and $2,824.........................................     11,734        10,606
License agreement, net of accumulated amortization of $1,548
  and $2,579................................................      4,642         3,611
Assembled workforce, net of accumulated amortization of $833
  and $1,468................................................      6,548         5,912
Noncompete/employment agreement, net of accumulated
  amortization of $467 and $1,400...........................      5,133         4,200
Unpatented proprietary technology, net of accumulated
  amortization of $340 and $976.............................      3,060         2,224
Patent licenses, net of accumulated amortization of $142 and
  $312......................................................        198           295
Deferred financing costs, net of accumulated amortization of
  $922 and $1,746...........................................      4,730         3,906
Organizational costs, net of accumulated amortization of
  $286 at January 1, 1999 (Note 2)..........................        939            --
Interest rate cap agreements................................         71           229
                                                               --------      --------
Total.......................................................   $120,900      $112,902
                                                               ========      ========	

The estimated useful lives of the significant intangible assets are as follows:

                                                              IN YEARS
                                                              --------
Goodwill....................................................      40
Trademark and names.........................................      40
Patented technology.........................................      12
Assembled workforce.........................................   10-12
Other intangibles...........................................    3-10	

7. ACCRUED LIABILITIES
Accrued liabilities consisted of the following (dollars in thousands):

                                                      JANUARY 1,   DECEMBER 31,
                                                         1999          1999
                                                      ----------   ------------
Profit sharing......................................   $  2,749      $  1,105
Interest............................................      2,350           931
Salaries and benefits...............................      4,688         3,832
Contingent consideration for Hittman acquisition
  (Note 3)..........................................      2,764            --
Other...............................................      1,597         1,271
                                                       --------      --------
Total...............................................   $ 14,148      $  7,139
                                                       ========      ========	

F-15

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
8. LONG-TERM OBLIGATIONS
Long-term obligations consisted of the following:

                                                                                           JUNE 30,
                                                              JANUARY 1,   DECEMBER 31,      2000
                                                                 1999          1999       (UNAUDITED)
                                                              ----------   ------------   -----------
                                                                      (DOLLARS IN THOUSANDS)
Long-term Debt:
  Term A Facility, $50.0 million, due September 30, 2004.
    Quarterly principal installments due of $0.625 million
    in December 1998 through September 1999, $1.25 million
    through September 2000, $1.875 million through September
    2002, $3.125 million through September 2003, and $3.75
    million through September 2004. Interest payments are
    due quarterly and charged, at the Company's option,
    based on either prime plus 1.50% or LIBOR plus 2.75% as
    per the credit agreement (prime was 8.50% and LIBOR was
    7.69% at January 1, 2000). Interest rate requirements
    varied from the above through the Waiver Period, as
    discussed below.........................................   $ 48,750      $ 46,250       $ 43,750
  Term B Facility, $60.0 million, due September 30, 2006.
    Quarterly principal installments due of $150,000 through
    September 2005 and $1.395 million through September
    2006. Interest payments are due quarterly and charged,
    at the Company's option, based on either prime plus
    1.75% or LIBOR plus 3.00% as per the credit agreement.
    Interest rate requirements varied from the above through
    the Waiver Period, as discussed below...................     59,700        59,250         58,950
  Revolving Facility, up to $20.0 million, due September 30,
    2004. Borrowing limited to $8 million through waiver
    period. Interest payments are due quarterly on any
    outstanding loans and charged, at the Company's option,
    based on either prime plus 1.50% or LIBOR plus 2.75% as
    per the credit agreement. Interest rate requirements
    varied from the above through the Waiver Period, as
    discussed below.........................................         --         4,300          1,100
  Senior Subordinated Notes, principal amount of Notes of
    $25.0 million due July 1, 2007. Semi-annual interest
    installments are due to note holders on January 1 and
    July 1 of each year.....................................     22,283        22,602         22,762
                                                               --------      --------       --------
    Total long-term debt....................................    130,733       132,402        126,562
Other long-term obligations.................................        553           811            311
                                                               --------      --------       --------
    Total long-term obligations.............................    131,286       133,213        126,873
Less current maturities of long-term obligations............     (2,950)       (6,225)        (7,475)
                                                               --------      --------       --------
Long-term obligations.......................................   $128,336      $126,988       $119,398
                                                               ========      ========       ========	

In July 1997, the Company entered into a Credit Agreement with various financial institutions providing a maximum of $60.0 million in senior, first-secured financing. In August 1998, this agreement was amended and restated to facilitate the Greatbatch-Hittman acquisition, and the maximum senior, first secured financing was increased to $130.0 million (the "Agreement"). The Agreement provides for
F-16

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
8. LONG-TERM OBLIGATIONS (CONTINUED) two term facilities ("Term A Facility" and "Term B Facility") and a revolving credit facility ("Revolving Facility"). No gain or loss was recorded as a result of the amended and restated Agreement.
Also, in July 1997, the Company issued $25.0 million, 13% Senior Subordinated Notes (the "Senior Subordinated Notes") to various affiliates of DLJ and third parties and received $25.0 million related to the issuance. At maturity, July 1, 2007, the entire principal amount of the Senior Subordinated Notes, $25.0 million, will be payable to the holders of the Senior Subordinated Notes. At the date of inception, the Company recorded $21,811,688 as its obligation due to lenders and $3,188,312 for shares issued to the lenders. The difference between the face amount of the Senior Subordinated Notes and the recorded book value is amortized under the effective yield method and will be charged to interest expense over the term of the Senior Subordinated Notes. The effect of this transaction resulted in an effective interest rate of 14.3% for the period from July 11, 1997 to January 2, 1998, 1998 and 1999. Payments are subordinated to amounts due under the Agreement. In connection with the issuance of the Senior Subordinated Notes, the Company issued 637,663 shares to the holders of the Senior Subordinated Notes.
The Revolving Facility includes the availability to the Company of up to $20.0 million in the form of either revolving loans, swing-line loans, or letters of credit. The swing-line loans and letters of credit may not exceed $2.0 million and $5.0 million, respectively. The Revolving Facility is due September 30, 2004. There was $4.3 million outstanding at December 31, 1999 and no balance outstanding at January 1, 1999.
Interest is payable quarterly on any outstanding loans and charged, at the Company's option, based on either prime or LIBOR plus an interest rate add-on ("Applicable Margin"). For the Term A Facility and the Revolving Facility, the Applicable Margin is 1.50% for prime rate loans and 2.75% for LIBOR rate loans. For the Term B Facility, the Applicable Margin is 1.75% and 3.00% for prime rate and LIBOR rate loans, respectively (see Note 18).
The Applicable Margin with respect to the Term A Facility and the Revolving Facility may be reduced, depending upon the Company's degree of leverage, as defined. The Applicable Margin is reduced in accordance with a matrix setting forth leverage ratios and corresponding Applicable Margins.
The Agreement for the Term A Facility, Term B Facility and the Revolving Facility contains, among other covenants, quarterly and annual financial covenants pertaining to minimum earnings, interest coverage, leverage and other ratios. In November 1999, the Agreement was amended to change and waive compliance with covenants. The Company was not in compliance at December 31, 1999 with the financial covenants relating to the Leverage Ratio and Interest Coverage Ratio contained in Section 7.2.4 (b) and Section 7.2.4 (c), respectively, of the Agreement. The Company has obtained waivers from the lending institutions for the aforementioned financial covenants for the period from November 15, 1999 to February 15, 2000 (the "Waiver Period"). In addition, during the Waiver Period, the Applicable Margins referred to above were all increased prospectively by 75 basis points and the Revolving Facility was limited to a maximum outstanding of $8.0 million. During the Waiver Period, the Company was restricted from making loans, investments and capital stock redemptions (see Note 18).
F-17

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
8. LONG-TERM OBLIGATIONS (CONTINUED) The Company has three outstanding interest rate cap agreements with three financial institutions. The Credit Agreement requires the Company to provide interest rate protection on at least 50% of the related senior credit facility. To meet this requirement, in December 1997, December 1998, and January 1999, the Company hedged $24.1 million, $30.0 million, and $25.0 million respectively of the outstanding Term A Facility and Term B Facility. The 1997 agreement caps LIBOR for a portion of the Term A Facility and the Term B Facility at 7% through December 2000. The 1998 and 1999 agreements cap LIBOR for a portion of the Term A Facility and the Term B Facility at 6% through January 2002.
Maturities of long-term obligations subsequent to December 31, 1999 are as follows (dollars in thousands):

2000........................................................  $  6,225
2001........................................................     8,600
2002........................................................     9,350
2003........................................................    13,725
2004........................................................    16,150
Thereafter..................................................    81,561
                                                              --------
Total of long-term maturities...............................   135,611
Amount to be amortized to debt on the Senior Subordinated
  Notes.....................................................    (2,398)
                                                              --------
Total.......................................................  $133,213
                                                              ========	

9. INCENTIVE COMPENSATION AND EMPLOYEE BENEFIT PLANS
INCENTIVE COMPENSATION PLANS--The Company sponsors various incentive compensation programs, which provide for the payment of cash to key employees based upon achievement of specific earnings goals before incentive compensation expense.
The scheduled payment terms of the deferred compensation plans subsequent to December 31, 1999 are as follows (dollars in thousands):

2000........................................................   $  680
2001........................................................      621
2002........................................................       14
                                                               ------
                                                                1,315
Less current maturities of deferred compensation (included
  in accrued liabilities)...................................     (680)
                                                               ------
Long-term portion of deferred compensation..................   $  635
                                                               ======	

F-18

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
9. INCENTIVE COMPENSATION AND EMPLOYEE BENEFIT PLANS (CONTINUED)
EMPLOYEE STOCK OWNERSHIP PLAN--The Company sponsors a non-leveraged Employee Stock Ownership Plan ("ESOP") and related trust as a long-term benefit for substantially all of its employees as defined in the plan documents. Under the ESOP, there are two components to ESOP contributions. The first component is a defined contribution pension plan whose annual contribution equals five percent of each employee's compensation. Contributions to the ESOP are in the form of Company stock.
The second component is a discretionary profit sharing contribution as determined by the Board of Directors. This profit sharing contribution is to be contributed to the ESOP in the form of Company stock. The ESOP is subject to contribution limitations and vesting requirements as defined in the plan.
Compensation cost recognized by the Company was approximately $2.2 million in 1998 and $1.1 million in 1999. There was no compensation cost prior to 1998. As of December 31, 1999, the Company had issued 164,701 shares under the ESOP and 72,467 committed-to-be-released shares under the ESOP, which equals the number of shares to settle the liability based on the fair value of shares as of December 31, 1999. Under the terms of the ESOP, the participant has a right to require the Company to repurchase the Company stock. The number of shares subject to the put options depends upon the number of terminated employees and is deemed to be DE MINIMIS at any point in time.
SAVINGS PLAN--The Company sponsors a defined contribution 401(k) plan, which covers substantially all of its employees. The plan provides for the deferral of employee compensation under Section 401(k) and a Company match. Net pension costs related to this defined contribution pension plan were approximately $57,000, $51,000, $477,500 and $429,000 from January 1, 1997 to July 10, 1997, from July 11, 1997 to January 2, 1998, in 1998 and 1999, respectively.
Total costs to the Company for all of the above plans were approximately $1,908,000, $1,384,000, $4,118,000 and $1,946,000 from January 1, 1997 to July 10, 1997, from July 11, 1997 to January 2, 1998, in 1998 and 1999, respectively.
10. STOCK OPTION PLANS
The Company has two stock option plans, which provide for the issuance of nonqualified and incentive stock options to employees of the Company. The Company's 1997 Stock Option Plan ("1997 Plan") authorizes the issuance of options to purchase up to 480,000 shares of common stock of the Company. The stock options generally vest over a five year period and may vary depending upon the achievement of earnings targets. The stock options expire 10 years from the date of the grant. Stock options are granted at exercise prices equal to the fair market value of the Company's common stock at the date of the grant.
The Company's 1998 Stock Option Plan ("1998 Plan") authorizes the issuance of nonqualified and incentive stock options to purchase up to 1,220,000 shares of common stock of the Company, subject to the terms of the plan. The stock options vest over a three to five year period and may vary depending upon the achievement of earnings targets. The stock options expire 10 years from the date of the grant. Stock options are granted at exercise prices equal to the fair value of the Company's common stock at the date of the grant.
F-19

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
10. STOCK OPTION PLANS (CONTINUED) As of December 31, 1999, options for 1,161,115 shares were available for future grants under the two plans. The weighted average remaining contractual life is seven years.
The Compensation Committee of the Board of Directors has determined the fair value of the stock options granted in 1999 and 1998. In the absence of a "regular, active public market," and based in part on an independent valuation of the Company's stock as of December 31, 1998 and consideration of comparable companies, the fair value of the common stock underlying stock options granted in fiscal 1999 was estimated to be $15.00 per share. The fair value of the common stock underlying stock options granted in fiscal 1998 was estimated to be $5.00 per share.
A summary of the transactions under the 1997 Plan and 1998 Plan for the period from July 11, 1997 to January 2, 1998 and the years ended January 1, 1999 and December 31, 1999 follows (there were no options prior to July 11, 1997):

                                                                OPTIONS     WEIGHTED AVERAGE
                                                              OUTSTANDING    EXERCISE PRICE
                                                              -----------   ----------------
Balance at July 11, 1997....................................          --         $   --
  Options granted...........................................     423,600           5.00
  Options exercised.........................................          --             --
  Options forfeited.........................................          --             --
                                                                --------         ------
Balance at January 2, 1998..................................     423,600           5.00
  Options granted...........................................      57,307           5.00
  Options exercised.........................................      (7,960)          5.00
  Options forfeited.........................................     (17,040)          5.00
                                                                --------         ------
Balance at January 1, 1999..................................     455,907           5.00
  Options granted...........................................     138,457          15.00
  Options exercised.........................................     (20,668)          5.00
  Options forfeited.........................................     (63,440)          5.75
                                                                --------         ------
Balance at December 31, 1999................................     510,257         $ 7.60
                                                                ========         ======
Options exercisable at:
  January 1, 1999...........................................     137,412         $ 5.00
  December 31, 1999.........................................     133,325         $ 7.05	

Of the options outstanding as of December 31, 1999, 435,239 options were outstanding at a range of exercise prices of $5.00 to $5.75, which approximated their weighted average exercise price. As of June 30, 2000, there were 584,683 options outstanding.
No compensation cost has been recognized in the financial statements because the option exercise price was equal to the estimated fair market value of the underlying stock on the date of grant. The weighted average grant date fair value of options granted was $5.00 for the period from July 11, 1997 to January 2, 1998, $15.00 for the year ended January 1, 1999 and $15.00 for the year ended December 31, 1999.
F-20

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
10. STOCK OPTION PLANS (CONTINUED) The Company has determined the pro forma information as if the Company had accounted for stock options granted under the fair value method of SFAS 123. The binomial option pricing model was used with the following weighted average assumptions for fiscal 1999: risk free interest rate of 6.55%; no dividend yield; expected common stock market price volatility factor of effectively zero; and a weighted average expected life of the options of 7 years. As prescribed by SFAS 123, pro forma net income (loss), basic and diluted earnings (loss) per share would have been $(15,480,000), $(1.75), $(1.75); $600,000, $0.06, $0.06; and $(2,975,000), $(0.24), $(0.24) for the period from July 11, 1997 to January 2, 1998 and for 1998 and 1999, respectively. These pro forma calculations assume the common stock is freely tradeable and as such, the impact is not necessarily indicative of the effects on reported net income of future years.
11. INCOME TAXES
The components of income tax expense (benefit) attributable to continuing operations for the periods from January 1, 1997 to July 10, 1997 and July 11, 1997 to January 2, 1998 and the years ended January 1, 1999 and December 31, 1999, consisted of the following (dollars in thousands):

                                     PREDECESSOR
                                   ---------------
                                   JANUARY 1, 1997    JULY 11, 1997
                                         TO                TO
                                    JULY 10, 1997    JANUARY 2, 1998     1998       1999
                                   ---------------   ---------------   --------   --------
Federal:
  Current........................      $  412            $   222        $ 580     $  (702)
  Deferred.......................          --             (8,514)        (129)        685
                                       ------            -------        -----     -------
                                          412             (8,292)         451         (17)
                                       ------            -------        -----     -------
State:
  Current........................         641                 60          142      (1,588)
  Deferred.......................          --             (1,236)        (183)      1,000
                                       ------            -------        -----     -------
                                          641             (1,176)         (41)       (588)
                                       ------            -------        -----     -------
Income tax expense (benefit).....      $1,053            $(9,468)       $ 410     $  (605)
                                       ======            =======        =====     =======	

The Federal and state taxes associated with the Predecessor (a former S corporation) are directly attributable to the sale of its assets to the Company (see Note 1).
The net deferred tax asset includes the following (dollars in thousands):

                                                        JANUARY 1,   DECEMBER 31,
                                                           1999          1999
                                                        ----------   ------------
Deferred tax asset--current...........................    $ 1,669       $1,520
Deferred tax asset--non current.......................      8,988        7,828
                                                          -------       ------
Net deferred tax asset................................    $10,657       $9,348
                                                          =======       ======	

F-21

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
11. INCOME TAXES (CONTINUED) The tax effect of major temporary differences that give rise to the Company's net deferred tax asset are as follows (dollars in thousands):

                                                        JANUARY 1,   DECEMBER 31,
                                                           1999          1999
                                                        ----------   ------------
Allowance for obsolete inventory and Uniform
  Capitalization......................................    $   677       $   687
Accrued liabilities and deferred compensation.........        859           751
Amortization of intangible assets.....................      7,775         7,249
Depreciation..........................................       (731)       (1,507)
Restructuring reserves................................        230           153
Tax credits...........................................      1,761           559
Net operating loss carryforward.......................         --         1,430
Other.................................................         86            26
                                                          -------       -------
Net deferred tax asset................................    $10,657       $ 9,348
                                                          =======       =======	

The net deferred tax asset of $7,775,000 at January 1, 1999 and $7,249,000 at December 31, 1999 ascribed to the amortization of intangible assets is primarily attributable to the July 11, 1997 to January 2, 1998 expensing of purchased in-process research, development and engineering costs.
The provision for income taxes differs in each of the periods and years from the federal statutory rate due to the following:

                                                       JULY 11, 1997
                                                            TO
                                                        JANUARY 2,
                                                           1998          1998       1999
                                                       -------------   --------   --------
Statutory rate.......................................        35%          35%        35%
State taxes..........................................         3           15        (30)
Federal and state tax credits........................        --          (14)        20
Other................................................        --            1          1
                                                            ---          ---        ---
Effective tax rate...................................        38%          37%        26%
                                                            ===          ===        ===	

12. CAPITAL STOCK
The authorized capital stock of the Company consists of 100,000,000 shares of common stock, $.001 par value per share. Dividends are not permitted until conditions under the senior secured debt agreement are satisfied, including payment in full of such senior debt obligations. Holders of common stock have one vote per share.
Subscribed common stock receivable consists of promissory notes, bearing interest at 6.4% (the "Applicable Federal Rate" at the time the notes were issued) extended by the Company to management stockholders to facilitate the purchase of 336,800 shares of common stock. The amounts under this arrangement are due November 2007.
F-22

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
12. CAPITAL STOCK (CONTINUED) On the date of the acquisition of Hittman (See Note 3), existing stockholders, who had participated in the leveraged buyout, purchased 3,300,000 additional shares of common stock at $5.00 per share.
13. COMMITMENTS AND CONTINGENCIES
The Company is a party to various legal actions arising in the normal course of business. The Company does not believe that any such pending activities should have a material adverse effect on its results of operations or financial position.
The Company is a party to various license agreements through 2003 to manufacture and sell components for use in medical implants and various commercial applications.
OPERATING LEASES--The Company is a party to various operating lease agreements for office and manufacturing space. The Company incurred operating lease expense of $53,000, $53,000, $621,000 and $807,000 the period January 1, 1997 to July 10, 1997 and July 11, 1997 to January 2, 1998 and in 1998 and 1999, respectively. Included in this amount is $43,000, $43,000, $83,655 and $211,000 paid in the period January 1, 1997 to July 10, 1997 and July 11, 1997 to January 2, 1998 and in 1998 and 1999, respectively to a related party under a non-cancelable operating lease which expires in 2006.
If all lease extension options are exercised as expected by Company management, minimum future annual operating lease payments over the next five years for the Company are $724,000 in 2000; $704,000 in 2001; $702,000 in 2002; $477,000 in 2003; and $405,000 in 2004.
14. BUSINESS SEGMENT INFORMATION
The Company operates its business in two reportable segments: medical and commercial power sources. The medical segment designs and manufactures power sources, capacitors and components used in implantable medical devices, which are instruments that are surgically inserted into the body to provide diagnosis or therapy. The commercial power sources segment designs and manufactures non- medical power sources for use in aerospace, oil and gas exploration and oceanographic equipment.
The Company's medical segment includes three product lines that have been aggregated because they share similar economic characteristics and similarities in the areas of products, production processes, types of customers, methods of distribution and regulatory environment. The three product lines are implantable power sources, capacitors and medical components.
The reportable segments are separately managed, and their performance is evaluated based on income from operations. Management defines segment income from operations as gross profit less costs and expenses attributable to segment specific selling, general and administrative and research, development and engineering. Non-segment specific selling, general and administrative, research, development and engineering, interest expense, intangible amortization and non-recurring items are not allocated to reportable segments. Revenues from transactions between the two segments are not
F-23

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
14. BUSINESS SEGMENT INFORMATION (CONTINUED) significant. The accounting policies of the segments are the same as those described in Note 2. All dollars are in thousands.

                                         WILSON
                                     GREATBATCH LTD.
                                      (PREDECESSOR)                     WILSON GREATBATCH TECHNOLOGIES, INC.
                                     ---------------   -----------------------------------------------------------------------
                                       PERIOD FROM     PERIOD FROM
                                       JANUARY 1,       JULY 11,
                                          1997            1997          YEAR          YEAR        SIX MONTHS      SIX MONTHS
                                           TO              TO          ENDED         ENDED           ENDED           ENDED
                                        JULY 10,       JANUARY 2,    JANUARY 1,   DECEMBER 31,      JULY 2,        JUNE 30,
                                          1997            1998          1999          1999           1999            2000
                                     ---------------   -----------   ----------   ------------   -------------   -------------
                                                                                                  (UNAUDITED)     (UNAUDITED)
Revenues:
  Medical..........................      $25,091        $ 20,819      $ 64,449      $ 69,224       $ 33,354        $ 41,746
  Commercial power sources.........        5,377           6,374        12,912        10,011          4,964           4,838
                                         -------        --------      --------      --------       --------        --------
  Total revenues...................      $30,468        $ 27,193      $ 77,361      $ 79,235       $ 38,318        $ 46,584
                                         =======        ========      ========      ========       ========        ========
Segment income from operations:
  Medical..........................      $11,213        $ 10,213      $ 26,834      $ 26,359       $ 13,037        $ 13,037
  Commercial power sources.........        1,560           2,590         4,303         2,711          1,249           1,251
                                         -------        --------      --------      --------       --------        --------
  Total segment income from
    operations.....................       12,773          12,803        31,137        29,070         14,286          14,558
  Unallocated......................      (19,588)        (37,673)      (30,037)      (31,384)       (15,521)        (15,662)
                                         -------        --------      --------      --------       --------        --------
Income (loss) before income
  taxes............................      $(6,815)       $(24,870)     $  1,100      $ (2,314)      $ (1,235)       $ (1,104)
                                         =======        ========      ========      ========       ========        ========
Expenditures for tangible
  long-lived assets:
  Medical..........................      $ 1,112        $    994      $  2,129      $  6,700
  Commercial power sources.........           24              79           136            72
                                         -------        --------      --------      --------
  Total reportable segments........        1,136           1,073         2,265         6,772
  Unallocated long-lived tangible
    assets.........................          798           1,583         3,942         1,680
                                         -------        --------      --------      --------
  Consolidated expenditures........      $ 1,934        $  2,656      $  6,207      $  8,452
                                         =======        ========      ========      ========	

                                                                     JANUARY 1,   DECEMBER 31,
                                                                        1999          1999
                                                                     ----------   ------------
Identifiable assets, net:
  Medical..........................                                   $ 34,481      $ 42,236
  Commercial power sources.........                                      5,959         5,068
                                                                      --------      --------
  Total reportable segments........                                     40,440        47,304
  Unallocated assets...............                                    153,950       142,475
                                                                      --------      --------
  Consolidated total assets........                                   $194,390      $189,779
                                                                      ========      ========	

F-24

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
14. BUSINESS SEGMENT INFORMATION (CONTINUED) Net revenues by geographic area are presented by attributing revenues based upon the location from external customers on the basis of where the products are sold. All dollars are in thousands.

                                                        WILSON
                                                    GREATBATCH LTD.
                                                     (PREDECESSOR)     WILSON GREATBATCH TECHNOLOGIES, INC.
                                                    ---------------   ---------------------------------------
                                                      PERIOD FROM     PERIOD FROM
                                                      JANUARY 1,       JULY 11,
                                                         1997            1997          YEAR          YEAR
                                                          TO              TO          ENDED         ENDED
                                                       JULY 10,       JANUARY 2,    JANUARY 1,   DECEMBER 31,
                                                         1997            1998          1999          1999
                                                    ---------------   -----------   ----------   ------------
Revenues by geographic area:
  United States...................................      $23,854         $20,946      $ 60,917      $ 58,644
  Foreign countries...............................        6,614           6,247        16,444        20,591
                                                        -------         -------      --------      --------
  Consolidated net revenues.......................      $30,468         $27,193      $ 77,361      $ 79,235
                                                        -------         -------      --------      --------	

                                                                              JANUARY 1,   DECEMBER 31,
                                                                                 1999          1999
                                                                              ----------   ------------
Long-lived assets:
  United States............................................................    $162,402      $156,409
Foreign countries..........................................................          --            --
                                                                               --------      --------
Consolidated long-lived assets.............................................    $162,402      $156,409
                                                                               ========      ========	

Two customers accounted for approximately 26%, 44%, 36% and 64% of sales for the period from January 1, 1997 to July 10, 1997, the period from July 11, 1997 to January 2, 1998 and the years ended January 1, 1999 and December 31, 1999, respectively. As of December 31, 1999, two customers accounted for approximately 62% of the outstanding accounts receivable.
15. SALE OF ASSETS
In August 1998, the Company sold the assets of a product line, Greatbatch-Scientific, to a third party in exchange for shares of stock of the third party. Greatbatch-Scientific sales were not significant to the consolidated financial statements. As a result of this transaction, the Company recorded the shares of stock acquired as an investment carried at cost, which approximated $2.4 million. Cost of the assets sold approximated fair value and accordingly, no gain or loss was recorded in the accompanying consolidated financial statements as of the date of sale. The investment is included in other assets on the consolidated balance sheet. The cost method is used to account for the Company's investment because the Company does not have the ability to exercise significant influence over the investee's operating and financial policies. Management intends for this investment to be long-term. As of December 31, 1999, a $859,000 impairment of this investment was recorded in fiscal 1999. The write-down of the investment represents an other than temporary decline and was based upon the Company's monitoring of this investment and other publicly available information.
F-25

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
16. RESTRUCTURING
In October 1998, management of the Company initiated a plan to restructure Engineered Components ("EC"), a product line of the Company's medical segment. EC ceased the production of non-medical products to concentrate on its core customer base. The restructuring is not expected to significantly impact future operations. A total of $825,000 in restructuring costs were charged to operations in fiscal 1998. Such restructuring costs included the following (dollars in thousands):

Asset Impairment Charges:
  Estimated unsaleable inventory............................    $350
  Losses from the planned disposal of equipment.............     300
                                                                ----
                                                                $650
                                                                ====

Other Restructuring Costs:
  Losses on equipment leases................................    $100
  Severance pay and benefits to employees...................      75
                                                                ----
                                                                $175
                                                                ====	

Approximately $49,000 for terminated EC employees and $5,000 for lease exit costs were paid in 1998. The future cash liability at January 1, 1999 approximated $26,000 for terminated EC employees and $95,000 for lease exit costs. Approximately $121,000, including all severance and benefits, was paid in cash, in 1999. In addition, approximately $80,000 of inventory was disposed of. The remaining assets are anticipated to be disposed of during the fourth quarter of 2000.
17. RELATED PARTY TRANSACTIONS
The Company had amounts due from related parties totaling $1,684,000 at January 1, 1999 and December 31, 1999, respectively. Amounts due from related parties is composed of notes receivable from executive officers and key employees in connection with their purchase in 1997 of shares of the Company's common stock. The notes receivable are due in November 2007 and bear interest at 6.42% per annum. Payments of interest commenced on May 1, 1998 and are due on each May 1 thereafter until the maturity date. The notes are full recourse notes that are collateralized by the 336,800 shares of common stock they purchased with the proceeds of the loans. The notes receivable is shown on the consolidated balance sheets as a reduction in stockholders' equity (see Note 12).
On July 10, 1997, the Company acquired all of the outstanding shares of Predecessor. Equity financing was provided by entities affiliated with DLJ Merchant Banking Partners II, L.P., an affiliate of DLJ. DLJ Capital Funding, Inc., an affiliate of DLJ, received a customary funding fee of approximately $1.5 million related to the issuance of the 1997 Credit Agreement. DLJ received a customary funding fee of approximately $1.9 million related to the issuance of the Senior Subordinated Notes and reimbursement for reasonable out-of-pocket expenses. Such amounts were capitalized as deferred financing fees and are being amortized over the life of the underlying debt. In August 1998, the Credit Agreement was amended and restated to facilitate the Hittman acquisition (see Note 3). DLJ received a fee of approximately $2.8 million related to acting as a financial advisor to the Company in connection with the acquisition, for its underwriting fee and a bond consent fee. Approximately
F-26

WILSON GREATBATCH TECHNOLOGIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
PERIODS FROM JANUARY 1, 1997 TO JULY 10, 1997 AND JULY 11, 1997
TO JANUARY 2, 1998 AND YEARS ENDED JANUARY 1, 1999 AND DECEMBER 31, 1999
17. RELATED PARTY TRANSACTIONS (CONTINUED) $1.8 million was capitalized as deferred financing fees and is being amortized over the life of the underlying debt. The remaining $1.0 million was included as part of the direct cost of the Hittman acquisition.
The Company may from time to time enter into other investment banking relationships with DLJ or one of its affiliates pursuant to which DLJ or its affiliates will receive customary fees and will be entitled to reimbursement of reasonable disbursements and out-of-pocket expenses incurred in connection therewith. The Company expects that any such arrangement will include provisions for the indemnification of DLJ against liability, including liabilities under the federal securities laws.
The Company is a party to an operating lease to a related party under a non-cancelable operating lease which expires in 2006 (see Note 13).
18. SUBSEQUENT EVENTS
In February 2000, the Agreement referred to in Note 8 was amended to change the financial covenants. The Company believes that it will be in compliance with the new covenants in fiscal 2000. The 75 basis point increase in Applicable Margin (as defined in Note 8) was made permanent. The Revolving Facility was set to a maximum of $13.0 million through December 31, 2000. After that time, if the leverage targets are met, the Revolving Facility will increase to $20.0 million.
On March 14, 2000, the Company signed a letter of intent to acquire the stock of a battery manufacturer. Closing of the transaction, along with final determination of a purchase price, will not occur prior to the second half of 2000 and is subject to customary conditions, including due diligence and the execution of a definitive purchase agreement.
19. SUBSEQUENT EVENT AFTER ISSUANCE (UNAUDITED)
On August 7, 2000, the Company completed the acquisition of all of the capital stock of Battery Engineering, Inc. ("BEI"), a small specialty battery manufacturer, in exchange for 339,856 shares of Company stock and assumption of approximately $2.7 million of indebtedness. The acquisition will be accounted for as a purchase. In a separate transaction, on August 7, 2000, the former parent of BEI purchased 200,000 shares of common stock at $15.00 per share.
* * * * * *
F-27

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
Hittman Materials and Medical Components, Inc.
We have audited the accompanying balance sheets of Hittman Materials and Medical Components, Inc. (the "Company") as of August 7, 1998 and December 31, 1997 and the related statements of operations, stockholder's equity and cash flows for the period from January 1, 1998 through August 7, 1998 and year ended December 31, 1997. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Hittman Materials and Medical Components, Inc. as of August 7, 1998 and December 31,1997, and the results of its operations and its cash flows for the period and year then ended in conformity with generally accepted accounting principles.

/S/ GRANT THORNTON LLP

Baltimore, Maryland
September 22, 1998	

F-28

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.
BALANCE SHEETS
AUGUST 7, 1998 AND DECEMBER 31, 1997

                                                               AUGUST 7,    DECEMBER 31
                                                                 1998          1997
                                                              -----------   -----------
                                        ASSETS
CURRENT ASSETS
  Cash and cash equivalents.................................  $   839,272   $  800,392
  Accounts receivable.......................................    2,023,195    1,709,351
  Inventories...............................................    1,986,096    2,339,210
  Prepaid expenses..........................................       44,245       27,340
                                                              -----------   ----------
      Total current assets..................................    4,892,808    4,876,293

PROPERTY AND EQUIPMENT--AT COST
  Furniture, fixtures and equipment.........................    2,115,414    1,856,253
  Equipment under capital lease.............................           --      574,117
                                                              -----------   ----------
                                                                2,115,414    2,430,370

  Less accumulated depreciation and amortization............    1,558,736    1,748,887
                                                              -----------   ----------
                                                                  556,678      681,483

OTHER ASSETS................................................       52,382       52,382
                                                              -----------   ----------
                                                              $ 5,501,868   $5,610,158
                                                              ===========   ==========
                                      LIABILITIES
CURRENT LIABILITIES
  Current maturities of capital lease obligation............  $        --   $   45,938
  Accounts payable..........................................      402,640      278,746
  Accrued compensation and employee benefits................      536,234      874,572
  Accrued expenses..........................................       94,995      161,429
                                                              -----------   ----------
      Total current liabilities.............................    1,033,869    1,360,685

CAPITAL LEASE OBLIGATION, less current maturities...........           --      306,154

COMMITMENTS.................................................           --           --

STOCKHOLDER'S EQUITY
  Common stock--par value, $.10 per share; authorized, 1,000
    shares;
    issued and outstanding, 500 shares......................           50           50
  Additional paid-in capital................................    5,858,834      299,950
  Retained (deficit) earnings...............................   (1,390,885)   3,643,319
                                                              -----------   ----------
                                                                4,467,999    3,943,319
                                                              -----------   ----------
                                                              $ 5,501,868   $5,610,158
                                                              ===========   ==========	

The accompanying notes are an integral part of these financial statements.
F-29

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.
STATEMENTS OF OPERATIONS
PERIOD FROM JANUARY 1, 1998 THROUGH AUGUST 7, 1998
AND THE YEAR ENDED DECEMBER 31, 1997

                                                              PERIOD ENDED    YEAR ENDED
                                                               AUGUST 7,     DECEMBER 31,
                                                                  1998           1997
                                                              ------------   ------------
NET SALES...................................................  $11,394,951    $18,507,437
COST OF SALES...............................................    5,072,595      7,769,408
                                                              -----------    -----------
      Gross profit..........................................    6,322,356     10,738,029
SELLING AND ADMINISTRATIVE EXPENSES.........................    2,202,100      2,829,658
                                                              -----------    -----------
      Operating profit......................................    4,120,256      7,908,371

OTHER INCOME (EXPENSE)
  Share value plan termination costs........................   (4,907,802)            --
  Gain on termination of capital lease......................       93,940             --
  Interest income...........................................       25,448         27,477
  Interest expense..........................................      (20,524)       (37,496)
  Other.....................................................       16,777         29,258
                                                              -----------    -----------
                                                               (4,792,161)        19,239
                                                              -----------    -----------
      NET (LOSS) EARNINGS...................................  $  (671,905)   $ 7,927,610
                                                              ===========    ===========	

The accompanying notes are an integral part of these financial statements.
F-30

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.
STATEMENTS OF STOCKHOLDER'S EQUITY
PERIOD FROM JANUARY 1, 1998 THROUGH AUGUST 7, 1998
AND THE YEAR ENDED DECEMBER 31, 1997

                                                            ADDITIONAL    RETAINED
                                                  COMMON     PAID-IN      EARNINGS
                                                  STOCK      CAPITAL      (DEFICIT)       TOTAL
                                                 --------   ----------   -----------   -----------
BALANCE AT JANUARY 1, 1997.....................    $50      $  299,950   $ 2,665,709   $ 2,965,709
  Net earnings.................................     --              --     7,927,610     7,927,610
  Dividends to stockholder.....................     --              --    (6,950,000)   (6,950,000)
                                                   ---      ----------   -----------   -----------
BALANCE AT DECEMBER 31, 1997...................     50         299,950     3,643,319     3,943,319
  Net loss.....................................     --              --      (671,905)     (671,905)
  Contributions from stockholder...............     --       5,558,884            --     5,558,884
  Dividends to stockholder.....................     --              --    (4,362,299)   (4,362,299)
                                                   ---      ----------   -----------   -----------
BALANCE AT AUGUST 7, 1998......................    $50      $5,858,834   $(1,390,885)  $ 4,467,999
                                                   ===      ==========   ===========   ===========	

The accompanying notes are an integral part of these financial statements.
F-31

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.
STATEMENTS OF CASH FLOWS
PERIOD FROM JANUARY 1, 1998 THROUGH AUGUST 7, 1998
AND THE YEAR ENDED DECEMBER 31, 1997

                                                                 1998          1997
                                                              -----------   -----------
Increase (decrease) in cash and cash equivalents

CASH FLOWS FROM OPERATING ACTIVITIES
  Net (loss) earnings.......................................  $  (671,905)  $ 7,927,610
  Adjustments to reconcile net (loss) earnings to net cash
    (used in) provided by operating activities
      Gain on lease termination.............................      (93,940)           --
      Depreciation and amortization.........................      152,958       323,541
      Changes in assets and liabilities
        Accounts receivable.................................     (313,844)     (177,286)
        Inventories.........................................      353,114      (758,891)
        Prepaid expenses....................................      (16,905)      (13,340)
        Accounts payable and accrued expenses...............     (280,877)      (56,390)
                                                              -----------   -----------
                                                                 (199,494)     (682,366)
                                                              -----------   -----------
          Net cash (used in) provided by operating
            activities......................................     (871,399)    7,245,244
CASH FLOWS FROM INVESTING ACTIVITIES
  Capital expenditures......................................      (28,154)     (133,964)
  Other.....................................................           --       (10,277)
                                                              -----------   -----------
          Net cash used in investing activities.............      (28,154)     (144,241)
CASH FLOWS FROM FINANCING ACTIVITIES
  Repayment of capital lease obligation.....................      (27,144)      (41,584)
  Stockholder contributions.................................    5,327,876            --
  Dividends paid............................................   (4,362,299)   (6,950,000)
                                                              -----------   -----------
          Net cash provided by (used in) financing
            activities......................................      938,433    (6,991,584)
                                                              -----------   -----------
          NET INCREASE IN CASH AND CASH EQUIVALENTS.........       38,880       109,419
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR..............      800,392       690,973
                                                              -----------   -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD/YEAR.............  $   839,272   $   800,392
                                                              ===========   ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
  Cash paid during the year for interest....................  $    20,524   $    37,496

NON-CASH INVESTING AND FINANCING ACTIVITIES:
  Equipment contributed by stockholder......................      231,008            --
  Capital lease obligation retired..........................      324,948            --	

The accompanying notes are an integral part of these financial statements.
F-32

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.
NOTES TO FINANCIAL STATEMENTS
AUGUST 7, 1998 AND DECEMBER 31, 1997
NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Hittman Materials and Medical Components, Inc. (the Company) is principally engaged in the manufacturing of components for medical devices, primarily implantables, such as pacemakers and defibrillators. Components are sold worldwide.
A summary of the significant accounting policies consistently applied in the preparation of the accompanying financial statements follows.
1. RECEIVABLES
The Company charges off doubtful receivables as bad debts in the year they are deemed to be uncollectible. Management believes that substantially all remaining receivables will be collected in the ordinary course of business and, accordingly, has not provided an allowance for doubtful accounts.
2. INVENTORIES
Inventories are valued at the lower of cost or market. Raw material costs are determined using the first-in, first-out method. Work-in-process and finished goods costs are determined based on accumulated average costs.
3. PROPERTY AND EQUIPMENT
Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to operations over the estimated service lives of the assets, principally using an accelerated method.
Equipment under a capitalized lease is depreciated over the lease term, which approximates the service lives of the equipment, using the straight-line method.
4. REVENUE RECOGNITION
Revenues are recognized at the time finished products are shipped.
5. RESEARCH AND DEVELOPMENT
Research and development expenditures are expensed as incurred and amounted to approximately $328,587 and $553,277 for the period ended August 7, 1998 and year ended December 31,1997, respectively.
6. INCOME TAXES
The Company has elected to be treated as an S Corporation under the Internal Revenue Code. As a result, income taxes on net earnings are payable personally by the Company's stockholder and the Company is not taxed as a Corporation. Accordingly, no provision has been made for income taxes. Had income taxes been payable by the Company, the income tax benefit would have been approximately $262,000 for the period ended August 7, 1998 and income tax expense of approximately $3,092,000 for the year ended December 31, 1997.
F-33

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
AUGUST 7, 1998 AND DECEMBER 31, 1997
NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
7. STATEMENTS OF CASH FLOWS
For purposes of the statements of cash flows, the Company considers all liquid debt instruments purchased with a maturity of three months or less to be cash equivalents.
8. USE OF ESTIMATES
In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. Actual results could differ from those estimates.
9. RECLASSIFICATIONS
Certain reclassifications have been made to 1997 amounts to conform with 1998 presentation.
NOTE B--INVENTORIES
Inventories at August 7, 1998 and December 31, 1997 are comprised as follows:

                                                          1998         1997
                                                       ----------   ----------
Raw materials........................................  $1,102,283   $1,475,330
Work-in-process......................................     767,248      342,033
Finished goods.......................................     116,565      521,847
                                                       ----------   ----------
                                                       $1,986,096   $2,339,210
                                                       ==========   ==========	

NOTE C--OTHER ASSETS
In 1993, the Company purchased a split dollar, joint life insurance policy with a last to die provision, on the lives of the Company's sole stockholder and his wife. The Company is the beneficiary to the extent of premiums paid.
NOTE D--CAPITAL LEASE OBLIGATION
The Company leased certain equipment from a related party under an agreement classified as a capital lease, which expired in 2003. The related asset and obligation were recorded using a 10% imputed interest rate. The lease was terminated as of August 7, 1998
F-34

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
AUGUST 7, 1998 AND DECEMBER 31, 1997
NOTE D--CAPITAL LEASE OBLIGATION (CONTINUED)
 The following is a schedule of equipment under capital lease.

                                                         AUGUST 7,   DECEMBER 31,
                                                           1998          1997
                                                         ---------   ------------
Equipment under capital lease..........................    $ --        $574,117
Less accumulated depreciation..........................      --         316,501
                                                           ----        --------
                                                           $ --        $257,616
                                                           ====        ========	

NOTE E--COMMITMENTS
The Company leases its facility from a related party under a non-cancelable operating lease agreement which expires in 2006. The Company is responsible for the payment of property taxes, insurance, maintenance and all other expenses associated with the operation of the facility. Rent expense of $79,277 and $131,520 was charged to operations for the period ended August 7, 1998 and the year ended December 31, 1997, respectively.
The Company also leases equipment under operating lease agreements which expire at various times over the next two to five years. Rent expense of $10,958 and $16,351 was charged to operations for the period ended August 7, 1998 and the year ended December 31, 1997, respectively.
At August 7, 1998, future minimum annual operating lease payments are as follows:

YEAR                                                           AMOUNT
----                                                          ---------
1998........................................................  $  91,482
1999........................................................    220,974
2000........................................................    215,916
2001........................................................    215,916
2002........................................................    212,372
2003........................................................    210,600
Thereafter..................................................  1,739,405	

NOTE F--RETIREMENT PLAN
The Hittman Retirement Plan covers substantially all employees who have reached the age of eighteen and completed six months of service. Eligible employees may execute a written agreement with the Company whereby the employee agrees to accept a salary reduction of not less than 1% nor more than 10% in exchange for the Company's contribution to the plan. The Company must contribute an amount based on the employee's percentage salary reduction. Additional employer contributions are allowed within certain limitations. The Company's contribution was approximately $112,000 in 1998 and $154,000 in 1997.
NOTE G--SHARE VALUE PLAN
In 1989, the Company instituted a share value plan wherein certain employees can receive compensation based on the earnings of the Company and under certain circumstances acquire shares of
F-35

HITTMAN MATERIALS AND MEDICAL COMPONENTS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
AUGUST 7, 1998 AND DECEMBER 31, 1997
NOTE G--SHARE VALUE PLAN (CONTINUED)
 the Company's common stock. Compensation expense of $5,241,428 and $500,000 was charged to operations for the period ended August 7, 1998 and the year ended December 31, 1997, respectively, pursuant to the plan. The plan was terminated as of August 7, 1998.
NOTE H--CONCENTRATIONS
MAJOR CUSTOMERS
During the period ended August 7, 1998, approximately 59% of sales were derived from four major customers and in 1997, approximately 80% of sales were derived from six major customers.
CASH BALANCES
The Company maintains its cash balances in several financial institutions located in Maryland, which at times may exceed federally insured limits. The Company has not experienced any losses and believes it is not exposed to any significant credit risk on cash and cash equivalents.
NOTE I--STOCK SALE
Effective with the close of business on August 7, 1998, all of the Company's outstanding stock was sold to Wilson Greatbatch Ltd.
F-36

, 2000
[LOGO]
WILSON GREATBATCH TECHNOLOGIES
SHARES OF COMMON STOCK

PROSPECTUS

DONALDSON, LUFKIN & JENRETTE                                 MERRILL LYNCH & CO.

                                ----------------

    BANC OF AMERICA SECURITIES LLC

                       U.S. BANCORP PIPER JAFFRAY

                                                                  DLJDIRECT INC.	

WE HAVE NOT AUTHORIZED ANY DEALER, SALESPERSON OR OTHER PERSON TO GIVE YOU WRITTEN INFORMATION OTHER THAN THIS PROSPECTUS OR TO MAKE REPRESENTATIONS AS TO MATTERS NOT STATED IN THIS PROSPECTUS. YOU MUST NOT RELY ON UNAUTHORIZED INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES OR OUR SOLICITATION OF YOUR OFFER TO BUY THE SECURITIES IN ANY JURISDICTION WHERE THAT WOULD NOT BE PERMITTED OR LEGAL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALES MADE HEREUNDER AFTER THE DATE OF THIS PROSPECTUS SHALL CREATE AN IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR THE AFFAIRS OF WILSON GREATBATCH TECHNOLOGIES HAVE NOT CHANGED SINCE THE DATE HEREOF.

UNTIL , 2000 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL DEALERS THAT EFFECT TRANSACTIONS IN THESE SHARES OF COMMON STOCK, WHETHER OR NOT PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE DEALER'S OBLIGATION TO DELIVER A PROSPECTUS WHEN ACTING AS AN UNDERWRITER AND REGARDING THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than underwriting discounts and commissions, payable in connection with the sale of common stock being registered. All amounts are estimates except the SEC registration fee and the NASD filing fees.

SEC registration fee........................................  $   30,360
NASD filing fee.............................................      12,000
New York Stock Exchange listing fee.........................     168,600
Printing and engraving......................................     475,000
Legal fees and expenses.....................................     500,000
Accounting fees and expenses................................     300,000
Transfer agent fees.........................................       3,500
Miscellaneous expenses......................................      60,540
                                                              ----------
  Total.....................................................  $1,550,000	

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law, or the DGCL, provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise), against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.
Section 145 further provides that a corporation similarly may indemnify any such person serving in any such capacity who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees) actually and reasonably incurred in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Delaware Court of Chancery or such other court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Delaware Court of Chancery or such other court shall deem proper.
Our restated certificate of incorporation provides that indemnification shall be to the fullest extent permitted by the DGCL for all current or former directors or officers of our company.
As permitted by the DGCL, the certificate of incorporation provides that directors of our company shall have no personal liability to our company or our stockholders for monetary damages for breach of fiduciary duty as a director, except (1) for any breach of the director's duty of loyalty to our company
II-1

or our stockholders, (2) for acts or omissions not in good faith or which involve intentional misconduct or knowing violation of law, (3) under
Section 174 of the DGCL or (4) for any transaction from which a director derived an improper personal benefit.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
We have not sold any securities, registered or otherwise, within the past three years, except as set forth below.
In July 1997, we issued 8,728,262 shares of our common stock for an aggregate purchase price of $43,641,312. The securities were issued in a private placement in reliance on Section 4(2) of the Securities Act. We issued 7,546,364 shares to DLJ Merchant Banking and its affiliates, 800,000 to former shareholders of Wilson Greatbatch Ltd. who participated in the leveraged buyout and their affiliates, 190,600 shares to members of our management and other key personnel who participated in the leveraged buyout and 191,298 shares to The Northwestern Mutual Life Insurance Company.
In November 1997, we issued 336,799 shares of our common stock, for an aggregate purchase price of $1,684,000, to members of our management and other key personnel who participated in the leveraged buyout. The securities were issued in a private placement in reliance on Section 4(2) of the Securities Act.
In March 1998, we issued 25,231 shares of our common stock, for an aggregate purchase price of $126,153, to the Trustees of the Wilson Greatbatch Ltd. Equity Plus Plan Stock Bonus Plan as a bonus to the plan members. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rue 701 under the Securities Act.
In April 1998, we issued 120 shares of our common stock, for an aggregate purchase price of $600, to John T. Fordyce upon his exercise of a stock option. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act.
In July 1998, we issued 1,920 shares of our common stock, for an aggregate purchase price of $9,600, to Stuart Scott Ferguson upon his exercise of a stock option. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act.
In August 1998, we issued 480 shares of our common stock, for an aggregate purchase price of $2,400, upon the exercise of stock options. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act. We issued 240 shares to Jack Belstadt and 240 shares to Charles Mozeko.
In August 1998, we issued 3,231,014 shares of our common stock for an aggregate purchase price of $16,619,616. We issued 2,849,384 shares to DLJ Merchant Banking and its affiliates. We issued 100,000 shares to East Hill Foundation and 201,630 shares to members of our management and other key personnel who participated in the leveraged buyout and their affiliates. We issued 80,000 shares to former shareholders of Wilson Greatbatch Ltd. who participated in the leveraged buyout and their affiliates. The securities were issued in a private placement in reliance on Section 4(2) of the Securities Act.
In August 1998, we issued 2,080 shares of our common stock, for an aggregate purchase price of $10,400, upon the exercise of stock options. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act. We issued 240 shares to Robert W. Siegler, 240 shares to Richard M. Garlapow and 1,600 shares to Gary Sfeir.
In August 1998, we issued 68,985 shares of our common stock, for an aggregate purchase price of $344,925, to The Northwestern Mutual Life Insurance Company. The securities were issued in a private placement in reliance on
Section 4(2) of the Securities Act.
II-2

In November 1998, we issued 3,360 shares of our common stock, for an aggregate purchase price of $16,800, to Robert C. Rusin upon his exercise of a stock option. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act.
In March 1999, we issued 10,761 shares of our common stock, for an aggregate purchase price of $53,805, upon the exercise of stock options. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act. We issued 1,448 shares to Gary Whitcher and 9,313 shares to Tim H. Belstadt.
In April 1999, we issued 4,363 shares of our common stock, for an aggregate purchase price of $21,816, upon the exercise of stock options. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act. We issued 251 shares to Gayle Fairchild, 251 shares to William Bruns and 3,861 shares to Robert W. Hammell.
In May 1999, we issued 3,356 shares of our common stock, for an aggregate purchase price of $16,782, to Robert C. Jackson upon the exercise of stock options. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act.
In August 1999, we issued 139,471 shares of our common stock, for an aggregate purchase price of $2,092,050, to the Trustees of the Wilson Greatbatch Ltd. Equity Plus Plan Stock Bonus Plan for our annual retirement plan contribution. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act.
In September 1999, we issued 50,000 shares of our common stock, for an aggregate purchase price of $750,000, to Fred Hittman. The securities were issued in a private placement in reliance on Section 4(2) of the Securities Act.
In September 1999, we issued 2,188 shares of our common stock, for an aggregate purchase price of $32,823, to Christine A. Fryz upon her exercise of stock options. The securities were issued in a transaction exempt from Section 5 of the Securities Act pursuant to Rule 701 under the Securities Act.
In December 1999, we issued 16,537 shares of our common stock, for an aggregate purchase price of $293,679, to members of our management and other key personnel who had terminated their employment. The securities were issued in a private placement in reliance on Section 4(2) of the Securities Act.
In August 2000, we issued 339,856 shares of our common stock to Hitachi Maxell, Ltd. in exchange for all of the capital stock of Battery Engineering, Inc. The securities were issued in reliance on Section 4(2) of the Securities Act.
In August 2000, we issued 200,000 shares of our common stock, for an aggregate purchase price of $3,000,006, to Hitachi Maxell, Ltd. The securities were issued in a private placement in reliance on Section 4(2) of the Securities Act.
No underwriters were involved in connection with any transaction set forth above. As noted above, the issuances of the securities described above were deemed to be exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder as a transaction by an issuer not involving a public offering. In all of these transactions, the recipients of securities represented their intention to acquire the securities for investment purposes only and not with a view to, or for sale in connection with, any distribution thereof and appropriate legends were affixed to the securities issued.
II-3

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(A) EXHIBITS

       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
        1.1             Form of Underwriting Agreement

        3.1*            Amended and Restated Certificate of Incorporation

        3.2*            Amended and Restated Bylaws

        5.1*            Opinion of Weil, Gotshal & Manges LLP

       10.1*            1997 Stock Option Plan (including form of "standard" option
                        agreement and form of "special" option agreement)

       10.2*            1998 Stock Option Plan (including form of "standard" option
                        agreement, form of "special" option agreement and form of
                        "non-standard" option agreement)

       10.3*            Wilson Greatbatch Ltd. Equity Plus Plan Money Purchase Plan

       10.4*            Wilson Greatbatch Ltd. Equity Plus Plan Stock Bonus Plan

       10.5*            Employment Agreement, dated as of July 9, 1997, between
                        Wilson Greatbatch Ltd. and Edward F. Voboril

       10.6*            Securities Purchase Agreement, dated as of July 10, 1997,
                        among WGL Acquisition Corp., Wilson Greatbatch Technologies,
                        Inc., DLJ Investment Partners, L.P., DLJ Investment Funding,
                        Inc., DLJ First ESC L.L.C., The Northwestern Mutual Life
                        Insurance Company and Donaldson, Lufkin & Jenrette
                        Securities Corporation

       10.7*            Registration and Anti-Dilution Agreement, dated as of July
                        10, 1997, among Wilson Greatbatch Technologies, Inc., DLJ
                        Investment Partners, L.P., DLJ Investment Funding, Inc., DLJ
                        First ESC L.L.C., The Northwestern Mutual Life Insurance
                        Company and Donaldson, Lufkin & Jenrette Securities
                        Corporation

       10.8*            Note Registration Rights Agreement, dated as of July 10,
                        1997, among Wilson Greatbatch Ltd., DLJ Investment Partners,
                        L.P., DLJ Investment Funding, Inc., DLJ First ESC L.L.C.,
                        DLJ LBO Plans Management Corporation, The Northwestern
                        Mutual Life Insurance Company and Donaldson, Lufkin &
                        Jenrette Securities Corporation

       10.9*            Amended and Restated Credit Agreement, dated as of August 7,
                        1998, among Wilson Greatbatch Ltd., DLJ Capital Funding,
                        Inc., as Syndication Agent, Heller Financial, Inc., as
                        Documentation Agent, Fleet National Bank, as Administrative
                        Agent, and various financial institutions party thereto as
                        Lenders

       10.10*           Waiver and Amendment No. 1 to Credit Agreement, dated as of
                        November 15, 1999, among Wilson Greatbatch Ltd., the
                        Consenting Obligors party thereto, DLJ Capital Funding,
                        Inc., as Syndication Agent, Heller Financial, Inc., as
                        Documentation Agent, Fleet National Bank, as Administrative
                        Agent, and various financial institutions party thereto as
                        Lenders

       10.11*           Amendment No. 2 to Credit Agreement, dated as of February
                        10, 2000, among Wilson Greatbatch Ltd., the Consenting
                        Obligors party thereto, DLJ Capital Funding, Inc., as
                        Syndication Agent, Heller Financial, Inc., as Documentation
                        Agent, Fleet National Bank, as Administrative Agent, and
                        various financial institutions party thereto as Lenders

       10.12*           Stockholders Agreement, dated as of July 16, 1997, among
                        Wilson Greatbatch Technologies, Inc., DLJ Merchant Banking
                        Partners II, L.P., DLJMB Funding II, Inc., DLJ Merchant
                        Banking Partners II-A, L.P., DLJ Diversified Partners, L.P.,
                        DLJ Diversified Partners-A, L.P., DLJ Millennium Partners,
                        L.P., DLJ First ESC L.L.C., DLJ Offshore Partners II, C.V.,
                        DLJ EAB Partners, L.P., U.K. Investment Plan 1997 Partners,
                        and the other holders of common stock of Wilson Greatbatch
                        Technologies Inc. party thereto	

II-4

       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
       10.13*           Amendment No. 1 to Stockholders Agreement, dated as of
                        October 31, 1997, among Wilson Greatbatch Technologies,
                        Inc., DLJ Merchant Banking Partners II, L.P., DLJMB Funding
                        II, Inc., DLJ Merchant Banking Partners II-A, L.P., DLJ
                        Diversified Partners, L.P., DLJ Diversified Partners-A,
                        L.P., DLJ Millennium Partners, L.P., DLJ First ESC L.L.C.,
                        DLJ Offshore Partners II, C.V., DLJ EAB Partners, L.P., U.K.
                        Investment Plan 1997 Partners, and the other holders of
                        common stock of Wilson Greatbatch Technologies, Inc. party
                        thereto

       10.14*           Management Stockholders Agreement, dated as of July 10,
                        1997, among Wilson Greatbatch Technologies, Inc., DLJ
                        Merchant Banking Partners II, L.P., DLJMB Funding II, Inc.,
                        DLJ Merchant Banking Partners II-A, L.P., DLJ Diversified
                        Partners, L.P., DLJ Diversified Partners-A, L.P., DLJ
                        Millennium Partners, L.P., DLJ First ESC L.L.C., DLJ
                        Offshore Partners II, C.V., DLJ EAB Partners, L.P., U.K.
                        Investment Plan 1997 Partners, and the other holders of
                        common stock of Wilson Greatbatch Technologies, Inc. party
                        thereto

       10.15*           Subordinated Note Holders Stockholders Agreement, dated as
                        of July 10, 1997, among Wilson Greatbatch Technologies,
                        Inc., DLJ Merchant Banking Partners II, L.P., DLJMB Funding
                        II, Inc., DLJ Merchant Banking Partners II-A, L.P., DLJ
                        Diversified Partners, L.P., DLJ Diversified Partners-A,
                        L.P., DLJ Millennium Partners, L.P., DLJ First ESC L.L.C.,
                        DLJ Offshore Partners II, C.V., DLJ EAB Partners, L.P., U.K.
                        Investment Plan 1997 Partners, DLJ Investment Partners,
                        L.P., DLJ Investment Funding, Inc., The Northwestern Mutual
                        Life Insurance Company and Donaldson, Lufkin & Jenrette
                        Securities Corporation

       10.16*+          Supply Agreement (SVO Batteries), dated as of July 31, 1991,
                        between Wilson Greatbatch Ltd. and Medtronic Inc.

       10.17*+          Amendment No. 1 to the Supply Agreement (SVO Batteries),
                        dated as of June 3, 1996, between Wilson Greatbatch Ltd. and
                        Medtronic Inc.

       10.18*+          Amendment No. 2 to the Supply Agreement (SVO Batteries),
                        dated as of March 24, 1997, between Wilson Greatbatch Ltd.
                        And Medtronic Inc.

       10.19*+          Amendment No. 3 to the Supply Agreement (SVO Batteries),
                        dated as of July 22, 1999, between Wilson Greatbatch Ltd.
                        and Medtronic Inc.

       10.20*+          Supply Agreement, dated as of February 1, 1999, among Wilson
                        Greatbatch Ltd. and Guidant/CRM

       10.21*+          Agreement, dated as of April 16, 1997, between Wilson
                        Greatbatch Ltd. and Pacesetter, Inc., a St. Jude Medical
                        Company

       10.22*+          License Agreement, dated August 8, 1996, between Wilson
                        Greatbatch Ltd. and Evans Capacitor Company

       10.23*+          Supplier Partnering Agreement, dated as of June 1, 2000,
                        between Wilson Greatbatch Ltd. and Pacesetter, Inc., a St.
                        Jude Medical Company

       10.24*           License Agreement, dated March 16, 1976, between Wilson
                        Greatbatch Ltd. and Medtronic Inc.

       10.25*           Amendment No. 1 to License Agreement, dated July 20, 1976,
                        between Wilson Greatbatch Ltd. and Medtronic Inc.

       10.26*           Stockholders Agreement, dated as of August 23, 1999, among
                        Wilson Greatbatch Technologies, Inc., DLJ Merchant Banking
                        Partners II, L.P., DLJMB Funding II, Inc., DLJ Merchant
                        Banking Partners II-A, L.P., DLJ Diversified Partners, L.P.,
                        DLJ Diversified Partners-A, L.P., DLJ Millennium Partners,
                        L.P., DLJ First ESC L.P., DLJ Offshore Partners II, C.V.,
                        DLJ EAB Partners, L.P., UK Investment Plan 1997 Partners and
                        Fred Hittman

       10.27*           Form of Subscription Agreement, dated on or about July 17,
                        1997, between Wilson Greatbatch Technologies, Inc. and each
                        of Edward F. Voboril, Larry T. DeAngelo, Curtis F. Holmes,
                        Ph.D., Arthur J. Lalonde, Richard W. Mott and Susan M.
                        Bratton.	

II-5

       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
       10.28*           Form of Management Subscription Agreement, dated November 1,
                        1997, between Wilson Greatbatch Technologies, Inc. and each
                        of Edward F. Voboril, Larry T. DeAngelo, Curtis F. Holmes,
                        Ph.D., Arthur J. Lalonde, Richard W. Mott and Susan M.
                        Bratton

       10.29*           Form of Promissory Note, dated November 1, 1997, payable to
                        Wilson Greatbatch Technologies, Inc. by each of Edward F.
                        Voboril, Larry T. DeAngelo, Curtis F. Holmes, Ph.D., Arthur
                        J. Lalonde, Richard W. Mott and Susan M. Bratton

       10.30*           Form of Pledge Agreement, dated November 1, 1997, between
                        Wilson Greatbatch Technologies, Inc. and each of Edward F.
                        Voboril, Larry T. DeAngelo, Curtis F. Holmes, Ph.D., Arthur
                        J. Lalonde, Richard W. Mott and Susan M. Bratton

       10.31*           Stock Purchase Agreement, dated as of July 31, 2000, among
                        Wilson Greatbatch Technologies, Inc., Battery Engineering,
                        Inc. and Hitachi Maxell, Ltd.

       10.32*           Stockholders Agreement, dated as of August 7, 2000, among
                        Wilson Greatbatch Technologies, Inc., Hitachi Maxell, Ltd.,
                        DLJ Merchant Banking Partners II, L.P., DLJMB Funding II,
                        Inc., DLJ Merchant Banking Partners II-A, L.P., DLJ
                        Diversified Partners, L.P., DLJ Diversified Partners-A,
                        L.P., DLJ Millennium Partners, L.P., DLJ First ESC L.P., DLJ
                        Offshore Partners II, C.V., DLJ EAB Partners, L.P. and UK
                        Investment Plan 1997 Partners

       10.33*           Subscription Agreement, dated as of August 7, 2000, between
                        Wilson Greatbatch Technologies, Inc. and Hitachi Maxell,
                        Ltd.

       10.34*           Non-Compete Agreement, dated as of August 7, 2000, between
                        Wilson Greatbatch Technologies, Inc. and Hitachi
                        Maxell, Ltd.

       21.1*            List of Subsidiaries

       23.1             Consent of Deloitte & Touche LLP

       23.2             Consent of Grant Thornton LLP

       23.3*            Consent of Weil, Gotshal & Manges LLP (included in Exhibit
                        5.1)

       24.1*            Power of Attorney

       27.1*            Financial Data Schedule	

* Previously filed.
+ Portions of the exhibit have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.
(B) FINANCIAL STATEMENT SCHEDULES

 PAGE
NUMBER                                   DESCRIPTION
------           ------------------------------------------------------------
  S-1            Schedule II--Valuation and Qualifying Accounts	

All other schedules are omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or the notes thereto.
ITEM 17. UNDERTAKINGS
The Registrant hereby undertakes:
(a) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the provisions described in Item 14, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is,
II-6

therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
(b) To provide to the underwriter(s) at the closing specified in the underwriting agreements, certificates in such denominations and registered in such names as required by the underwriter(s) to permit prompt delivery to each purchaser.
(c) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective.
(d) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
II-7

SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Clarence, New York, on August 25, 2000.

WILSON GREATBATCH TECHNOLOGIES, INC.

By:  /s/ ARTHUR J. LALONDE
     -----------------------------------------
     Arthur J. Lalonde
     Vice President, Finance
     and Treasurer	

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the dates indicated:

             NAME                                      TITLE                          DATE
             ----                                      -----                          ----
    /s/ EDWARD F. VOBORIL *          President, Chief Executive Officer and
-------------------------------        Chairman of the Board (principal          August 25, 2000
       Edward F. Voboril               executive officer)

     /s/ ARTHUR J. LALONDE           Vice President, Finance and Treasurer
-------------------------------        (principal financial and accounting       August 25, 2000
       Arthur J. Lalonde               officer)

     /s/ DAVID L. JAFFE *            Director
-------------------------------                                                  August 25, 2000
        David L. Jaffe

     /s/ ROBERT E. RICH *            Director
-------------------------------                                                  August 25, 2000
        Robert E. Rich

    /s/ DOUGLAS E. ROGERS *          Director
-------------------------------                                                  August 25, 2000
       Douglas E. Rogers

       /s/ HENRY WENDT *             Director
-------------------------------                                                  August 25, 2000
          Henry Wendt

    /s/ DAVID M. WITTELS *           Director
-------------------------------                                                  August 25, 2000
       David M. Wittels	

*By:  /s/ ARTHUR J. LALONDE
      --------------------------
      Arthur J. Lalonde
      Attorney-in-Fact	

II-8

SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS
 (DOLLARS IN THOUSANDS)

                                                              COL. C
                                                            ADDITIONS
                                                      ----------------------
                                           COL. B                   CHARGED
                                         BALANCE AT    CHARGED     TO OTHER      COL. D         COL. E
                COL. A                   BEGINNING     TO COSTS    ACCOUNTS-   DEDUCTIONS-    BALANCE AT
              DESCRIPTION                OF PERIOD    & EXPENSES   DESCRIBE    DESCRIBE(1)   END OF PERIOD
              -----------                ----------   ----------   ---------   -----------   -------------
January 1, 1997 to July 10, 1997:
  Allowance for doubtful accounts......    $  118       $   63       $ --        $   (53)       $  128
  Valuation for LIFO inventory.........     1,173           --         --            (90)        1,083

July 11, 1997 to January 2, 1998:
  Allowance for doubtful accounts......       128            4         --             (9)          123
  Valuation for LIFO inventory.........     1,083           --         --         (1,083)(2)        --

Fiscal 1998:
  Allowance for doubtful accounts......       123          111         --            (37)          197

Fiscal 1999:
  Allowance for doubtful accounts......       197          179         --           (157)          219	

(1) Accounts written off, net of collections on accounts receivable.
(2) Represents the LIFO inventory valuation applicable to Predecessor adjusted in accordance with the purchase method of accounting.
S-1

INDEX TO EXHIBITS

       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------                           -----------
   1.1                  Form of Underwriting Agreement

   3.1*                 Amended and Restated Certificate of Incorporation

   3.2*                 Amended and Restated Bylaws

   5.1*                 Opinion of Weil, Gotshal & Manges LLP

  10.1*                 1997 Stock Option Plan (including form of "standard" option
                        agreement and form of "special" option agreement)

  10.2*                 1998 Stock Option Plan (including form of "standard" option
                        agreement, form of "special" option agreement and form of
                        "non-standard" option agreement)

  10.3*                 Wilson Greatbatch Ltd. Equity Plus Plan Money Purchase Plan

  10.4*                 Wilson Greatbatch Ltd. Equity Plus Plan Stock Bonus Plan

  10.5*                 Employment Agreement, dated as of July 9, 1997, between
                        Wilson Greatbatch Ltd. and Edward F. Voboril

  10.6*                 Securities Purchase Agreement, dated as of July 10, 1997,
                        among WGL Acquisition Corp., Wilson Greatbatch Technologies,
                        Inc., DLJ Investment Partners, L.P., DLJ Investment Funding,
                        Inc., DLJ First ESC L.L.C., The Northwestern Mutual Life
                        Insurance Company and Donaldson, Lufkin & Jenrette
                        Securities Corporation

  10.7*                 Registration and Anti-Dilution Agreement, dated as of July
                        10, 1997, among Wilson Greatbatch Technologies, Inc., DLJ
                        Investment Partners, L.P., DLJ Investment Funding, Inc., DLJ
                        First ESC L.L.C., The Northwestern Mutual Life Insurance
                        Company and Donaldson, Lufkin & Jenrette Securities
                        Corporation

  10.8*                 Note Registration Rights Agreement, dated as of July 10,
                        1997, among Wilson Greatbatch Ltd., DLJ Investment Partners,
                        L.P., DLJ Investment Funding, Inc., DLJ First ESC L.L.C.,
                        DLJ LBO Plans Management Corporation, The Northwestern
                        Mutual Life Insurance Company and Donaldson, Lufkin &
                        Jenrette Securities Corporation

  10.9*                 Amended and Restated Credit Agreement, dated as of August 7,
                        1998, among Wilson Greatbatch Ltd., DLJ Capital Funding,
                        Inc., as Syndication Agent, Heller Financial, Inc., as
                        Documentation Agent, Fleet National Bank, as Administrative
                        Agent, and various financial institutions party thereto as
                        Lenders

  10.10*                Waiver and Amendment No. 1 to Credit Agreement, dated as of
                        November 15, 1999, among Wilson Greatbatch Ltd., the
                        Consenting Obligors party thereto, DLJ Capital Funding,
                        Inc., as Syndication Agent, Heller Financial, Inc., as
                        Documentation Agent, Fleet National Bank, as Administrative
                        Agent, and various financial institutions party thereto as
                        Lenders

  10.11*                Amendment No. 2 to Credit Agreement, dated as of February
                        10, 2000, among Wilson Greatbatch Ltd., the Consenting
                        Obligors party thereto, DLJ Capital Funding, Inc., as
                        Syndication Agent, Heller Financial, Inc., as Documentation
                        Agent, Fleet National Bank, as Administrative Agent, and
                        various financial institutions party thereto as Lenders

  10.12*                Stockholders Agreement, dated as of July 16, 1997, among
                        Wilson Greatbatch Technologies, Inc., DLJ Merchant Banking
                        Partners II, L.P., DLJMB Funding II, Inc., DLJ Merchant
                        Banking Partners II-A, L.P., DLJ Diversified Partners, L.P.,
                        DLJ Diversified Partners-A, L.P., DLJ Millennium Partners,
                        L.P., DLJ First ESC L.L.C., DLJ Offshore Partners II, C.V.,
                        DLJ EAB Partners, L.P., U.K. Investment Plan 1997 Partners,
                        and the other holders of common stock of Wilson Greatbatch
                        Technologies, Inc. party thereto	

       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------                           -----------
  10.13*                Amendment No. 1 to Stockholders Agreement, dated as of
                        October 31, 1997, among Wilson Greatbatch Technologies,
                        Inc., DLJ Merchant Banking Partners II, L.P., DLJMB Funding
                        II, Inc., DLJ Merchant Banking Partners II-A, L.P., DLJ
                        Diversified Partners, L.P., DLJ Diversified Partners-A,
                        L.P., DLJ Millennium Partners, L.P., DLJ First ESC L.L.C.,
                        DLJ Offshore Partners II, C.V., DLJ EAB Partners, L.P., U.K.
                        Investment Plan 1997 Partners, and the other holders of
                        common stock of Wilson Greatbatch Technologies, Inc. party
                        thereto

  10.14*                Management Stockholders Agreement, dated as of July 10,
                        1997, among Wilson Greatbatch Technologies, Inc., DLJ
                        Merchant Banking Partners II, L.P., DLJMB Funding II, Inc.,
                        DLJ Merchant Banking Partners II-A, L.P., DLJ Diversified
                        Partners, L.P., DLJ Diversified Partners-A, L.P., DLJ
                        Millennium Partners, L.P., DLJ First ESC L.L.C., DLJ
                        Offshore Partners II, C.V., DLJ EAB Partners, L.P., U.K.
                        Investment Plan 1997 Partners, and the other holders of
                        common stock of Wilson Greatbatch Technologies, Inc. party
                        thereto

  10.15*                Subordinated Note Holders Stockholders Agreement, dated as
                        of July 10, 1997, among Wilson Greatbatch Technologies,
                        Inc., DLJ Merchant Banking Partners II, L.P., DLJMB Funding
                        II, Inc., DLJ Merchant Banking Partners II-A, L.P., DLJ
                        Diversified Partners, L.P., DLJ Diversified Partners-A,
                        L.P., DLJ Millennium Partners, L.P., DLJ First ESC L.L.C.,
                        DLJ Offshore Partners II, C.V., DLJ EAB Partners, L.P., U.K.
                        Investment Plan 1997 Partners, DLJ Investment Partners,
                        L.P., DLJ Investment Funding, Inc., The Northwestern Mutual
                        Life Insurance Company and Donaldson, Lufkin & Jenrette
                        Securities Corporation

  10.16*+               Supply Agreement (SVO Batteries), dated as of July 31, 1991,
                        between Wilson Greatbatch Ltd. and Medtronic Inc.

  10.17*+               Amendment No. 1 to the Supply Agreement (SVO Batteries),
                        dated as of June 3, 1996, between Wilson Greatbatch Ltd. and
                        Medtronic Inc.

  10.18*+               Amendment No. 2 to the Supply Agreement (SVO Batteries),
                        dated as of March 24, 1997, between Wilson Greatbatch Ltd.
                        and Medtronic Inc.

  10.19*+               Amendment No. 3 to the Supply Agreement (SVO Batteries),
                        dated as of July 22, 1999, between Wilson Greatbatch Ltd.
                        and Medtronic Inc.

  10.20*+               Supply Agreement, dated as of February 1, 1999, among Wilson
                        Greatbatch Ltd. and Guidant/CRM

  10.21*+               Agreement, dated as of April 16, 1997, between Wilson
                        Greatbatch Ltd. and Pacesetter, Inc., a St. Jude Medical
                        Company

  10.22*+               License Agreement, dated August 8, 1996, between Wilson
                        Greatbatch Ltd. and Evans Capacitor Company

  10.23*+               Supplier Partnering Agreement, dated as of June 1, 2000,
                        between Wilson Greatbatch Ltd. and Pacesetter, Inc., a St.
                        Jude Medical Company

  10.24*                License Agreement, dated March 16, 1976, between Wilson
                        Greatbatch Ltd. and Medtronic Inc.

  10.25*                Amendment No. 1 to License Agreement, dated July 20, 1976,
                        between Wilson Greatbatch Ltd. and Medtronic Inc.

  10.26*                Stockholders Agreement, dated as of August 23, 1999, among
                        Wilson Greatbatch Technologies, Inc., DLJ Merchant Banking
                        Partners II, L.P., DLJMB Funding II, Inc., DLJ Merchant
                        Banking Partners II-A, L.P., DLJ Diversified Partners, L.P.,
                        DLJ Diversified Partners-A, L.P., DLJ Millennium Partners,
                        L.P., DLJ First ESC L.P., DLJ Offshore Partners II, C.V.,
                        DLJ EAB Partners, L.P., UK Investment Plan 1997 Partners and
                        Fred Hittman	

       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------                           -----------
  10.27*                Form of Subscription Agreement, dated on or about July 17,
                        1997, between Wilson Greatbatch Technologies, Inc. and each
                        of Edward F. Voboril, Larry T. DeAngelo, Curtis F. Holmes,
                        Ph.D., Arthur J. Lalonde, Richard W. Mott and Susan M.
                        Bratton

  10.28*                Form of Management Subscription Agreement, dated November 1,
                        1997, between Wilson Greatbatch Technologies, Inc. and each
                        of Edward F. Voboril, Larry T. DeAngelo, Curtis F. Holmes,
                        Ph.D., Arthur J. Lalonde, Richard W. Mott and Susan M.
                        Bratton

  10.29*                Form of Promissory Note, dated November 1, 1997, payable to
                        Wilson Greatbatch Technologies, Inc. by each of Edward F.
                        Voboril, Larry T. DeAngelo, Curtis F. Holmes, Ph.D., Arthur
                        J. Lalonde, Richard W. Mott and Susan M. Bratton

  10.30*                Form of Pledge Agreement, dated November 1, 1997, between
                        Wilson Greatbatch Technologies, Inc. and each of Edward F.
                        Voboril, Larry T. DeAngelo, Curtis F. Holmes, Ph.D., Arthur
                        J. Lalonde, Richard W. Mott and Susan M. Bratton

  10.31*                Stock Purchase Agreement, dated as of July 31, 2000, among
                        Wilson Greatbatch Technologies, Inc., Battery Engineering,
                        Inc. and Hitachi Maxell, Ltd.

  10.32*                Stockholders Agreement, dated as of August 7, 2000, among
                        Wilson Greatbatch Technologies, Inc., Hitachi Maxell, Ltd.,
                        DLJ Merchant Banking Partners II, L.P., DLJMB Funding II,
                        Inc., DLJ Merchant Banking Partners II-A, L.P., DLJ
                        Diversified Partners, L.P., DLJ Diversified Partners-A,
                        L.P., DLJ Millennium Partners, L.P., DLJ First ESC L.P., DLJ
                        Offshore Partners II, C.V., DLJ EAB Partners, L.P. and UK
                        Investment Plan 1997 Partners

  10.33*                Subscription Agreement, dated as of August 7, 2000, between
                        Wilson Greatbatch Technologies, Inc. and Hitachi Maxell,
                        Ltd.

  10.34*                Non-Compete Agreement, dated as of August 7, 2000, between
                        Wilson Greatbatch Technologies, Inc. and Hitachi
                        Maxell, Ltd.

  21.1*                 List of Subsidiaries

  23.1                  Consent of Deloitte & Touche LLP

  23.2                  Consent of Grant Thornton LLP

  23.3*                 Consent of Weil, Gotshal & Manges LLP (included in Exhibit
                        5.1)

  24.1*                 Power of Attorney

  27.1*                 Financial Data Schedule	

* Previously filed.
+ Portions of the exhibit have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential
treatment.

Exhibit 1.1
_________ Shares
WILSON GREATBATCH TECHNOLOGIES, INC.
Common Stock
UNDERWRITING AGREEMENT
__________, 2000
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MERRILL LYNCH, PIERCE,
FENNER & SMITH INCORPORATED
BANC OF AMERICA SECURITIES LLC
U.S. BANCORP PIPER JAFFRAY INC.
DLJDIRECT INC.
As representatives of the several Underwriters named in Schedule I hereto
c/o Donaldson, Lufkin & Jenrette Securities Corporation 277 Park Avenue
New York, New York 10172
Dear Sirs:
Wilson Greatbatch Technologies, Inc., a Delaware corporation (the "COMPANY"), proposes to issue and sell ____________ shares of its common stock, par value $.001 per share (the "FIRM SHARES"), to the several underwriters named in Schedule I hereto (the "UNDERWRITERS"). The Company also proposes to issue and sell to the several Underwriters not more than an additional _______ shares of the common stock, par value $.001 per share (the "ADDITIONAL SHARES"), if requested by the Underwriters as provided in Section 2 hereof. The Firm Shares and the Additional Shares are hereinafter referred to collectively as the "SHARES". The shares of common stock of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the "COMMON STOCK."
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SECTION 1. REGISTRATION STATEMENT AND PROSPECTUS. The Company has prepared and filed with the Securities and Exchange Commission (the "COMMISSION") in accordance with the provisions of the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the "ACT"), a registration statement on Form S-1, including a prospectus, relating to the Shares. The registration statement, as amended at the time it became effective, including the information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430A under the Act, is hereinafter referred to as the "REGISTRATION STATEMENT" and the prospectus in the form first used to confirm sales of Shares is hereinafter referred to as the "PROSPECTUS". If the Company has filed or is required pursuant to the terms hereof to file a registration statement pursuant to Rule 462(b) under the Act registering additional shares of Common Stock (a "RULE
462(B) REGISTRATION STATEMENT"), then, unless otherwise specified, any reference herein to the term "Registration Statement" shall be deemed to include such Rule
462(b) Registration Statement.
SECTION 2. AGREEMENTS TO SELL AND PURCHASE AND LOCK-UP AGREEMENTS. On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to issue and sell, and each Underwriter agrees, severally and not jointly, to purchase from the Company at a price per Share of $______ (the "PURCHASE Price") the number of Firm Shares set forth opposite the name of such Underwriter in Schedule I hereto.
On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to issue and sell the Additional Shares and the Underwriters shall have the right to purchase, severally and not jointly, up to _______ Additional Shares from the Company at the Purchase Price. Additional Shares may be purchased solely for the purpose of covering over-allotments made in connection with the offering of the Firm Shares. The Underwriters may exercise their right to purchase Additional Shares in whole or in part from time to time by giving written notice thereof to the Company within 30 days after the date of this Agreement. You shall give any such notice on behalf of the Underwriters and such notice shall specify the aggregate number of Additional Shares to be purchased pursuant to such exercise and the date for payment and delivery thereof, which date shall be a business day (i) no earlier than two business days after such notice has been given (and, in any event, no earlier than the Closing Date (as hereinafter defined)) and
(ii) no later than ten business days after such notice has been given. If any Additional Shares are to be purchased, each Underwriter, severally and not jointly, agrees to purchase from the Company the number of Additional Shares (subject to such adjustments to eliminate fractional shares as you may determine) which bears the same proportion to the total number of Additional Shares to be purchased from the Company as the number of Firm Shares set forth opposite the name of such Underwriter in Schedule I bears to the total number of Firm Shares.
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The Company hereby agrees not to (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or
(ii) enter into any swap or other arrangement that transfers all or a portion of the economic consequences associated with the ownership of any Common Stock
(regardless of whether any of the transactions described in clause (i) or (ii) is to be settled by the delivery of Common Stock, or such other securities, in cash or otherwise), except to the Underwriters pursuant to this Agreement, for a period of 180 days after the date of the Prospectus without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation. Notwithstanding the foregoing, during such period (i) the Company may grant stock options pursuant to the Company's existing stock option plans and (ii) the Company may issue shares of Common Stock upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof. The Company also agrees not to file any registration statement with respect to any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock for a period of 180 days after the date of the Prospectus without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation. The Company shall, prior to or concurrently with the execution of this Agreement, deliver an agreement executed by (i) each of the directors and officers of the Company and (ii) each stockholder listed on Annex I hereto to the effect that such person will not, during the period commencing on the date such person signs such agreement and ending 180 days after the date of the Prospectus, without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation, (A) engage in any of the transactions described in the first sentence of this paragraph or (B) make any demand for, or exercise any right with respect to, the registration of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock.
The Company hereby confirms its engagement of Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MERRILL LYNCH") as, and Merrill Lynch hereby confirms its agreement with the Company to render services as, a "qualified independent underwriter," within the meaning of Section (b)(15) of Rule 2720 of the Conduct Rules of the National Association of Securities Dealers, Inc. (the "NASD") with respect to the offering and sale of the Shares. Merrill Lynch, solely in its capacity as qualified independent underwriter and not otherwise, is referred to herein as the "QIU." As compensation for the services of the QIU hereunder, the Company agrees to pay the QIU $5,000 on the Closing Date. The price at which the Shares will be sold to the public shall not be higher than the maximum price recommended by DLJ acting as QIU.
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SECTION 3. TERMS OF PUBLIC OFFERING. The Company is advised by you that the Underwriters propose to (i) make a public offering of their respective portions of the Shares as soon after the execution and delivery of this Agreement as in your judgment is advisable and (ii) initially offer the Shares upon the terms set forth in the Prospectus.
SECTION 4. DELIVERY AND PAYMENT. The Shares shall be represented by definitive certificates and shall be issued in such authorized denominations and registered in such names as Donaldson, Lufkin & Jenrette Securities Corporation shall request no later than two business days prior to the Closing Date or the applicable Option Closing Date (as defined below), as the case may be. The Company shall deliver the Shares, with any transfer taxes thereon duly paid by the respective Sellers, to Donaldson, Lufkin & Jenrette Securities Corporation through the facilities of The Depository Trust Company ("DTC"), for the respective accounts of the several Underwriters, against payment to the Company of the Purchase Price therefore by wire transfer of Federal or other funds immediately available in New York City. The certificates representing the Shares shall be made available for inspection not later than 9:30 A.M., New York City time, on the business day prior to the Closing Date or the applicable Option Closing Date (as defined below), as the case may be, at the office of DTC or its designated custodian (the "DESIGNATED OFFICE"). The time and date of delivery and payment for the Firm Shares shall be 9:00 A.M., New York City time, on _______, 2000 or such other time on the same or such other date as Donaldson, Lufkin & Jenrette Securities Corporation and the Company shall agree in writing. The time and date of delivery for the Firm Shares are hereinafter referred to as the "CLOSING DATE". The time and date of delivery and payment for any Additional Shares to be purchased by the Underwriters shall be 9:00 A.M., New York City time, on the date specified in the applicable exercise notice given by you pursuant to Section 2 or such other time on the same or such other date as Donaldson, Lufkin & Jenrette Securities Corporation and the Company shall agree in writing. The time and date of delivery for the Additional Shares are hereinafter referred to as an "OPTION CLOSING DATE."
The documents to be delivered on the Closing Date or any Option Closing Date on behalf of the parties hereto pursuant to Section 8 of this Agreement shall be delivered at the offices of Akin, Gump, Strauss, Hauer & Feld, L.L.P., 590 Madison Avenue, New York, New York, 10022, and the Shares shall be delivered at the Designated Office, all on the Closing Date or such Option Closing Date, as the case may be.
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SECTION 5. AGREEMENTS OF THE COMPANY. The Company agrees with you:
(a) To advise you promptly and, if requested by you, to confirm such advice in writing (i) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information, (ii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of the suspension of qualification of the Shares for offering or sale in any jurisdiction, or the initiation of any proceeding for such purposes, (iii) when any amendment to the Registration Statement becomes effective, (iv) if the Company is required to file a Rule 462(b) Registration Statement after the effectiveness of this Agreement, when the Rule 462(b) Registration Statement has become effective and
(v) of the happening of any event during the period referred to in Section 5(d) below which makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or which requires any additions to or changes in the Registration Statement or the Prospectus in order to make the statements therein not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, the Company will use its best efforts to obtain the withdrawal or lifting of such order at the earliest possible time.
(b) To furnish to you with six signed copies of the Registration Statement as first filed with the Commission and of each amendment to it, including all exhibits, and to furnish to you and each Underwriter designated by you such number of conformed copies of the Registration Statement as so filed and of each amendment to it, without exhibits, as you may reasonably request.
(c) To prepare the Prospectus, the form and substance of which shall be satisfactory to you, and to file the Prospectus in such form with the Commission within the applicable period specified in Rule 424(b) under the Act; during the period specified in Section 5(d) below, not to file any further amendment to the Registration Statement and not to make any amendment or supplement to the Prospectus of which you shall not previously have been advised or to which you shall reasonably object after being so advised; and, during such period, to prepare and file with the Commission, promptly upon your reasonable request, any amendment to the Registration Statement or amendment or supplement to the Prospectus which may be necessary or advisable in connection with the distribution of the Shares by you, and to use its best efforts to cause any such amendment to the Registration Statement to become promptly effective.
(d) Prior to 10:00 A.M., New York City time, on the first business day after the date of this Agreement and from time to time thereafter for such period as in the opinion of counsel for the Underwriters a prospectus is required by law to be delivered in connection with sales by an Underwriter or a dealer, to furnish in New York City to each Underwriter and any dealer as many copies of the Prospectus (and of any amendment or supplement to the Prospectus) as such
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Underwriter or dealer may reasonably request.
(e) If during the period specified in Section 5(d), any event shall occur or condition shall exist as a result of which, in the opinion of counsel for the Underwriters, it becomes necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare and file with the Commission an appropriate amendment or supplement to the Prospectus so that the statements in the Prospectus, as so amended or supplemented, will not in the light of the circumstances when it is so delivered, be misleading, or so that the Prospectus will comply with applicable law, and to furnish to each Underwriter and to any dealer as many copies thereof as such Underwriter or dealer may reasonably request.
(f) Prior to any public offering of the Shares, to cooperate with you and counsel for the Underwriters in connection with the registration or qualification of the Shares for offer and sale by the several Underwriters and by dealers under the state securities or Blue Sky laws of such jurisdictions as you may request, to continue such registration or qualification in effect so long as required for distribution of the Shares and to file such consents to service of process or other documents as may be necessary in order to effect such registration or qualification; PROVIDED, HOWEVER, that the Company shall not be required in connection therewith to qualify as a foreign corporation in any jurisdiction in which it is not now so qualified or to take any action that would subject it to general consent to service of process or taxation other than as to matters and transactions relating to the Prospectus, the Registration Statement, any preliminary prospectus or the offering or sale of the Shares, in any jurisdiction in which it is not now so subject.
(g) To mail and make generally available to its stockholders as soon as practicable an earnings statement covering the twelve-month period ending September 30, 2001 that shall satisfy the provisions of Section 11(a) of the Act, and to advise you in writing when such statement has been so made available.
(h) During the period of three years after the date of this Agreement, to furnish to you as soon as available copies of all reports or other communications furnished to the record holders of Common Stock or furnished to or filed with the Commission or any national securities exchange on which any class of securities of the Company is listed and such other publicly available information concerning the Company and its subsidiaries as you may reasonably request.
(i) Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, to pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement,
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including: (i) the fees, disbursements and expenses of the Company's counsel and the Company's accountants in connection with the registration and delivery of the Shares under the Act and all other fees and expenses in connection with the preparation, printing, filing and distribution of the Registration Statement (including financial statements and exhibits), any preliminary prospectus, the Prospectus and all amendments and supplements to any of the foregoing, including the mailing and delivering of copies thereof to the Underwriters and dealers in the quantities specified herein, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or other taxes payable thereon, (iii) all costs of printing or producing this Agreement and any other agreements or documents in connection with the offering, purchase, sale or delivery of the Shares, (iv) all expenses in connection with the registration or qualification of the Shares for offer and sale under the securities or Blue Sky laws of the several states and all costs of printing or producing any Preliminary and Supplemental Blue Sky Memoranda in connection therewith (including the filing fees and fees and disbursements of counsel for the Underwriters in connection with such registration or qualification and memoranda relating thereto), (v) the filing fees and disbursements of counsel for the Underwriters in connection with the review and clearance of the offering of the Shares by the NASD, (vi) all fees and expenses in connection with the preparation and filing of the registration statement on Form 8-A relating to the Common Stock and all costs and expenses incident to the listing of the Shares on the New York Stock Exchange, Inc. (the "NYSE"), (vii) the cost of printing certificates representing the Shares, (viii) the costs and charges of any transfer agent, registrar and/or depositary, (ix) the fees and expenses of the QIU (including the fees and disbursements of counsel to the QIU) and (x) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section.
(j) To use its best efforts to list, subject to notice of issuance, the Shares on the NYSE and to maintain the listing of the Shares on the NYSE for a period of three years after the date of this Agreement.
(k) To use its best efforts to do and perform all things required or necessary to be done and performed under this Agreement by the Company prior to the Closing Date or any Option Closing Date, as the case may be, and to satisfy all conditions precedent to the delivery of the Shares.
(l) If the Registration Statement at the time of the effectiveness of this Agreement does not cover all of the Shares, to file a Rule 462(b) Registration Statement with the Commission registering the Shares not so covered in compliance with Rule 462(b) by 10:00 P.M., New York City time, on the date of this Agreement and to pay to the Commission the filing fee for such Rule 462(b) Registration Statement at the time of the filing thereof or to give irrevocable instructions for the payment of such fee pursuant to Rule 111(b) under the Act.
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SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each Underwriter that:
(a) The Registration Statement has become effective (other than any Rule
462(b) Registration Statement to be filed by the Company after the effectiveness of this Agreement); any Rule 462(b) Registration Statement filed after the effectiveness of this Agreement will become effective no later than 10:00 P.M., New York City time, on the date of this Agreement; and no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose are pending before or threatened by the Commission.
(b) (i) The Registration Statement (other than any Rule 462(b) Registration Statement to be filed by the Company after the effectiveness of this Agreement), when it became effective, did not contain and, as amended, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement (other than any Rule 462(b) Registration Statement to be filed by the Company after the effectiveness of this Agreement) and the Prospectus comply and, as amended or supplemented, if applicable, will comply in all material respects with the Act, (iii) if the Company is required to file a Rule 462(b) Registration Statement after the effectiveness of this Agreement, such Rule 462(b) Registration Statement and any amendments thereto, when they become effective (A) will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading and (B) will comply in all material respects with the Act and (iv) the Prospectus does not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein.
(c) Each preliminary prospectus filed as part of the registration statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Act, complied when so filed in all material respects with the Act, and did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in any preliminary prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein.
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(d) Each of the Company and its subsidiaries has been duly incorporated, is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation and has the corporate power and authority to carry on its business as described in the Prospectus and to own, lease and operate its properties, and each is duly qualified and is in good standing as a foreign corporation authorized to do business in each jurisdiction in which the nature of its business or its ownership or leasing of property requires such qualification, except where the failure to be so qualified would not have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole.
(e) There are no outstanding subscriptions, rights, warrants, options, calls, convertible securities, commitments of sale or liens granted or issued by the Company or any of its subsidiaries relating to or entitling any person to purchase or otherwise to acquire any shares of the capital stock of the Company or any of its subsidiaries, except as otherwise disclosed in the Registration Statement.
(f) All the outstanding shares of capital stock of the Company have been duly authorized and validly issued and are fully paid, non-assessable and not subject to any preemptive or similar rights; and the Shares have been duly authorized and, when issued and delivered to the Underwriters against payment therefor as provided by this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of such Shares will not be subject to any preemptive or similar rights.
(g) All of the outstanding shares of capital stock of each of the Company's subsidiaries have been duly authorized and validly issued and are fully paid and non-assessable, and are owned by the Company, directly or indirectly through one or more subsidiaries, free and clear of any security interest, claim, lien, encumbrance or adverse interest of any nature.
(h) The authorized capital stock of the Company conforms as to legal matters to the description thereof contained in the Prospectus.
(i) Neither the Company nor any of its subsidiaries is in violation of its respective charter or by-laws or in default in the performance of any obligation, agreement, covenant or condition contained in any indenture, loan agreement, mortgage, lease or other agreement or instrument that is material to the Company and its subsidiaries, taken as a whole, to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or their respective property is bound.
(j) The execution, delivery and performance of this Agreement by the Company, the compliance by the Company with all the provisions hereof and the consummation of the transactions contemplated hereby will not (i) require any
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consent, approval, authorization or other order of, or qualification with, any court or governmental body or agency (except such as may be required under the securities or Blue Sky laws of the various states), (ii) conflict with or constitute a breach of any of the terms or provisions of, or a default under, the charter or by-laws of the Company or any of its subsidiaries or any indenture, loan agreement, mortgage, lease or other agreement or instrument that is material to the Company and its subsidiaries, taken as a whole, to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or their respective property is bound, (iii) violate or conflict with any applicable law or any rule, regulation, judgment, order or decree of any court or any governmental body or agency having jurisdiction over the Company, any of its subsidiaries or their respective property or (iv) result in the suspension, termination or revocation of any Authorization (as defined below) of the Company or any of its subsidiaries or any other impairment of the rights of the holder of any such Authorization.
(k) There are no legal or governmental proceedings pending or threatened to which the Company or any of its subsidiaries is or could be a party or to which any of their respective property is or could be subject that are required to be described in the Registration Statement or the Prospectus and are not so described; nor are there any statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not so described or filed as required.
(l) Neither the Company nor any of its subsidiaries has violated any foreign, federal, state or local law or regulation relating to the protection of human health and safety (including, without limitation, laws relating to the Food and Drug Administration), the environment or hazardous or toxic substances or wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"), any provisions of the Employee Retirement Income Security Act of 1974, as amended, or any provisions of the Foreign Corrupt Practices Act, or the rules and regulations promulgated thereunder, except for such violations which, singly or in the aggregate, would not have a material adverse effect on the business, prospects, financial condition or results of operation of the Company and its subsidiaries, taken as a whole.
(m) Each of the Company and its subsidiaries has such permits, licenses, consents, exemptions, franchises, authorizations and other approvals (each, an "AUTHORIZATION") of, and has made all filings with and notices to, all governmental or regulatory authorities and self-regulatory organizations and all courts and other tribunals, including, without limitation, under any applicable Environmental Laws, as are necessary to own, lease, license and operate its respective properties and to conduct its business, except where the failure to have any such Authorization or to make any such filing or notice would not, singly or in the aggregate, have a material adverse effect on the business, prospects,
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financial condition or results of operations of the Company and its subsidiaries, taken as a whole. Each such Authorization is valid and in full force and effect and each of the Company and its subsidiaries is in compliance with all the terms and conditions thereof and with the rules and regulations of the authorities and governing bodies having jurisdiction with respect thereto; and no event has occurred (including, without limitation, the receipt of any notice from any authority or governing body) which allows or, after notice or lapse of time or both, would allow, revocation, suspension or termination of any such Authorization or results or, after notice or lapse of time or both, would result in any other impairment of the rights of the holder of any such Authorization; and such Authorizations contain no restrictions that are burdensome to the Company or any of its subsidiaries; except where such failure to be valid and in full force and effect or to be in compliance, the occurrence of any such event or the presence of any such restriction would not, singly or in the aggregate, have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole.
(n) There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any Authorization, any related constraints on operating activities and any potential liabilities to third parties) which would, singly or in the aggregate, have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole.
(o) This Agreement has been duly authorized, executed and delivered by the Company.
(p) Deloitte & Touche LLP are independent public accountants with respect to the Company and its subsidiaries as required by the Act.
(q) The consolidated financial statements included in the Registration Statement and the Prospectus (and any amendment or supplement thereto), together with related schedules and notes, present fairly the consolidated financial position, results of operations and changes in financial position of the Company and its subsidiaries on the basis stated therein at the respective dates or for the respective periods to which they apply; such statements and related schedules and notes have been prepared in accordance with generally accepted accounting principles consistently applied throughout the periods involved, except as disclosed therein; the supporting schedules, if any, included in the Registration Statement present fairly in accordance with generally accepted accounting principles the information required to be stated therein; and the other financial and statistical information and data set forth in the Registration Statement and the Prospectus (and any amendment or supplement thereto) are, in all material respects, accurately presented and prepared on a basis consistent with such financial statements and the books and records of the Company.
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(r) The Company is not and, after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Prospectus, will not be, an "investment company" as such term is defined in the Investment Company Act of 1940, as amended.
(s) There are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement.
(t) Since the respective dates as of which information is given in the Prospectus other than as set forth in the Prospectus (exclusive of any amendments or supplements thereto subsequent to the date of this Agreement), (i) there has not occurred any material adverse change or any development involving a prospective material adverse change in the condition, financial or otherwise, or the earnings, business, management or operations of the Company and its subsidiaries, taken as a whole, (ii) there has not been any material adverse change or any development involving a prospective material adverse change in the capital stock or in the long-term debt of the Company or any of its subsidiaries and (iii) neither the Company nor any of its subsidiaries has incurred any material liability or obligation, direct or contingent.
(u) Each certificate signed by any officer of the Company and delivered to the Underwriters or counsel for the Underwriters shall be deemed to be a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
(v) The Company owns or possesses, or can acquire on reasonable terms, all patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks and trade names (collectively, "INTELLECTUAL PROPERTY") currently employed by it in connection with the business now operated by it, except where the failure to own or possess or otherwise be able to acquire such Intellectual Property would not, singly or in the aggregate, have a material adverse effect on the business, prospects, financial condition or results of operation of the Company; and the Company is not infringing or conflicting with asserted rights of others with respect to any of such Intellectual Property which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a material adverse effect on the business, prospects, financial condition or results of operations of the Company.
SECTION 7. INDEMNIFICATION. (a) The Company agrees to indemnify and hold harmless each Underwriter, its directors, its officers and each person, if any, who
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controls any Underwriter within the meaning of Section 15 of the Act or Section 20 of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), from and against any and all losses, claims, damages, liabilities and judgments (including, without limitation, any legal or other expenses incurred in connection with investigating or defending any matter, including any action, that could give rise to any such losses, claims, damages, liabilities or judgments) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), the Prospectus (or any amendment or supplement thereto) or any preliminary prospectus, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or judgments are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to any Underwriter furnished in writing to the Company by such Underwriter through you expressly for use therein; PROVIDED, HOWEVER, that the foregoing indemnity agreement with respect to any preliminary prospectus shall not inure to the benefit of any Underwriter who failed to deliver a Prospectus (as then amended or supplemented, provided by the Company to the several Underwriters in the requisite quantity and on a timely basis to permit proper delivery on or prior to the Closing Date) to the person asserting any losses, claims, damages and liabilities and judgments caused by any untrue statement or alleged untrue statement of a material fact contained in any preliminary prospectus, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, if such material misstatement or omission or alleged material misstatement or omission was cured in such Prospectus and such Prospectus was required by law to be delivered at or prior to the written confirmation of sale to such person.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent as the foregoing indemnity from the Company to such Underwriter but only with reference to information relating to such Underwriter furnished in writing to the Company by such Underwriter through you expressly for use in the Registration Statement (or any amendment thereto), the Prospectus (or any amendment or supplement thereto) or any preliminary prospectus.
(c) In case any action shall be commenced involving any person in respect of which indemnity may be sought pursuant to Section 7(a) or 7(b) (the "INDEMNIFIED PARTY"), the indemnified party shall promptly notify the person against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing and the indemnifying party shall assume the defense of such action, including the employment of counsel reasonably satisfactory to the indemnified party and the payment of all fees and expenses of such counsel, as incurred
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(except that in the case of any action in respect of which indemnity may be sought pursuant to both Sections 7(a) and 7(b), the Underwriter shall not be required to assume the defense of such action pursuant to this Section 7(c), but may employ separate counsel and participate in the defense thereof, but the fees and expenses of such counsel, except as provided below, shall be at the expense of such Underwriter). Any indemnified party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of the indemnified party unless (i) the employment of such counsel shall have been specifically authorized in writing by the indemnifying party, (ii) the indemnifying party shall have failed to assume the defense of such action or employ counsel reasonably satisfactory to the indemnified party or (iii) the named parties to any such action (including any impleaded parties) include both the indemnified party and the indemnifying party, and the indemnified party shall have been advised by such counsel that there may be one or more legal defenses available to it which are different from or additional to those available to the indemnifying party (in which case the indemnifying party shall not have the right to assume the defense of such action on behalf of the indemnified party). In any such case, the indemnifying party shall not, in connection with any one action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) for all indemnified parties and all such fees and expenses shall be reimbursed as they are incurred. Such firm shall be designated in writing by Donaldson, Lufkin & Jenrette Securities Corporation and Merrill Lynch, in the case of parties indemnified pursuant to Section 7(a), and by the Company, in the case of parties indemnified pursuant to Section 7(b). The indemnifying party shall indemnify and hold harmless the indemnified party from and against any and all losses, claims, damages, liabilities and judgments by reason of any settlement of any action (i) effected with its written consent or
(ii) effected without its written consent if the settlement is entered into more than twenty business days after the indemnifying party shall have received a request from the indemnified party for reimbursement for the fees and expenses of counsel (in any case where such fees and expenses are at the expense of the indemnifying party) and, prior to the date of such settlement, the indemnifying party shall have failed to comply with such reimbursement request. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement or compromise of, or consent to the entry of judgment with respect to, any pending or threatened action in respect of which the indemnified party is or could have been a party and indemnity or contribution may be or could have been sought hereunder by the indemnified party, unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability on claims that are or could have been the subject matter of such action and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of the indemnified party.
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(d) To the extent the indemnification provided for in this Section 7 is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages, liabilities or judgments referred to therein, then each indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities and judgments (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the offering of the Shares or (ii) if the allocation provided by clause 7(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 7(d)(i) above but also the relative fault of the Company on the one hand and the Underwriters on the other hand in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or judgments, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other hand shall be deemed to be in the same proportion as the total net proceeds from the offering (after deducting underwriting discounts and commissions, but before deducting expenses) received by the Company, and the total underwriting discounts and commissions received by the Underwriters, bear to the total price to the public of the Shares, in each case as set forth in the table on the cover page of the Prospectus. The relative fault of the Company on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7(d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or judgments referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such indemnified party in connection with investigating or defending any matter, including any action, that could have given rise to such losses, claims, damages, liabilities or judgments. Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not
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guilty of such fraudulent misrepresentation. The Underwriters' obligations to contribute pursuant to this Section 7(d) are several in proportion to the respective number of Shares purchased by each of the Underwriters hereunder and not joint.
(e) The remedies provided for in this Section 7 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.
SECTION 8. INDEMNIFICATION OF QIU.
(a) The Company agrees to indemnify and hold harmless the QIU, its directors, its officers and each person, if any, who controls the QIU within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and against any and all losses, claims, damages, liabilities and judgments (including, without limitation, any legal or other expenses incurred in connection with defending or investigating any matter, including any action that could give rise to any such losses, claims, damages, liabilities or judgments) related to, based upon or arising out of (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), the Prospectus (or any amendment or supplement thereto) or any preliminary prospectus, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading or (ii) the QIU's activities as QIU under its engagement pursuant to Section 2 hereof.
(b) In case any action shall be commenced involving any person in respect of which indemnity may be sought pursuant to paragraph (a) of this Section 8 (THE "QIU INDEMNIFIED PARTY"), the QIU Indemnified Party shall promptly notify the Company in writing and the Company shall assume the defense of such action, including the employment of counsel reasonably satisfactory to the QIU Indemnified Party and the payment of all fees and expenses of such counsel, as incurred. Any QIU Indemnified Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of the QIU Indemnified Party unless (i) the employment of such counsel shall have been specifically authorized in writing by the Company, (ii) the Company shall have failed to assume the defense of such action or employ counsel reasonably satisfactory to the QIU Indemnified Party or (iii) the named parties to any such action (including any impleaded parties) include both the QIU Indemnified Party and the Company, and the QIU Indemnified Party shall have been advised by such counsel that there may be one or more legal defenses available to it which are different from or additional to those available to the Company (in which case the Company shall not have the right to assume the defense of such action on behalf of the QIU Indemnified Party). In any such case, the Company shall not, in connection with any one action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or
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circumstances, be liable for the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) for all QIU Indemnified Parties, which firm shall be designated by the QIU, and all such fees and expenses shall be reimbursed as they are incurred. The Company shall indemnify and hold harmless the QIU Indemnified Party from and against any and all losses, claims, damages, liabilities and judgments by reason of any settlement of any action (i) effected with its written consent or (ii) effected without its written consent if the settlement is entered into more than ten business days after the Company shall have received a request from the QIU Indemnified Party for reimbursement for the fees and expenses of counsel (in any case where such fees and expenses are at the expense of the Company) and, prior to the date of such settlement, the Company shall have failed to comply with such reimbursement request. The Company shall not, without the prior written consent of the QIU Indemnified Party, effect any settlement or compromise of, or consent to the entry of judgment with respect to, any pending or threatened action in respect of which the QIU Indemnified Party is or could have been a party and indemnity or contribution may be or could have been sought hereunder by the QIU Indemnified Party, unless such settlement, compromise or judgment (i) includes an unconditional release of the QIU Indemnified Party from all liability on claims that are or could have been the subject matter of such action and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of the QIU Indemnified Party.
(c) To the extent the indemnification provided for in this Section 8 is unavailable to a QIU Indemnified Party or insufficient in respect of any losses, claims, damages, liabilities or judgments referred to therein, then the Company, in lieu of indemnifying such QIU Indemnified Party, shall contribute to the amount paid or payable by such QIU Indemnified Party as a result of such losses, claims, damages, liabilities and judgments (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the QIU on the other hand from the offering of the Shares or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company and the QIU in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or judgments, as well as any other relevant equitable considerations. The relative benefits received by the Company and the QIU shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company as set forth in the table on the cover page of the Prospectus, and the fee received by the QIU pursuant to Section 2 hereof, bear to the sum of such total net proceeds and such fee. The relative fault of the Company and the QIU shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the QIU and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
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The Company and the QIU agree that it would not be just and equitable if contribution pursuant to this Section 8(c) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by a QIU Indemnified Party as a result of the losses, claims, damages, liabilities or judgments referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such QIU Indemnified Party in connection with investigating or defending any matter that could have given rise to such losses, claims, damages, liabilities or judgments. In no event shall any QIU Indemnified Party be required to contribute in the aggregate an amount exceeding the fee received by the QIU pursuant to Section 2 hereof. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
(d) The remedies provided for in this Section 8 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any QIU Indemnified Party at law or in equity.
SECTION 9. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations of the Underwriters to purchase the Firm Shares under this Agreement are subject to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company contained in this Agreement shall be true and correct on the Closing Date with the same force and effect as if made on and as of the Closing Date.
(b) If the Company is required to file a Rule 462(b) Registration Statement after the effectiveness of this Agreement, such Rule 462(b) Registration Statement shall have become effective by 10:00 P.M., New York City time, on the date of this Agreement; and no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been commenced or shall be pending before or contemplated by the Commission.
(c) You shall have received on the Closing Date a certificate dated the Closing Date, signed by Edward F. Voboril and Arthur J. Lalonde, in their capacities as President, Chief Executive Officer and Chairman of the Board and Vice President, Finance and Treasurer, respectively, of the Company, confirming the matters set forth in Sections 6(t), 9(a) and 9(b) and that the Company has complied with all of the agreements and satisfied all of the conditions herein contained and required to be complied with or satisfied by the Company on or prior to the Closing Date.
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(d) Since the respective dates as of which information is given in the Prospectus other than as set forth in the Prospectus (exclusive of any amendments or supplements thereto subsequent to the date of this Agreement), (i) there shall not have occurred any change or any development involving a prospective change in the condition, financial or otherwise, or the earnings, business, management or operations of the Company and its subsidiaries, taken as a whole, (ii) there shall not have been any change or any development involving a prospective change in the capital stock or in the long-term debt of the Company or any of its subsidiaries and (iii) neither the Company nor any of its subsidiaries shall have incurred any liability or obligation, direct or contingent, the effect of which, in any such case described in clause 9(d)(i), 9(d)(ii) or 9(d)(iii), in your judgment, is material and adverse and, in your judgment, makes it impracticable to market the Shares on the terms and in the manner contemplated in the Prospectus.
(e) You shall have received on the Closing Date an opinion (satisfactory to you and counsel for the Underwriters), dated the Closing Date, of Weil, Gotshal & Manges LLP counsel for the Company, to the effect that:
(i) each of the Company and Wilson Greatbatch Ltd., WGL Intermediate Holdings, Inc. and Hittman, Inc. (each a "Subsidiary" and collectively the "Subsidiaries"), is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation and has the corporate power and authority to carry on its business as described in the Prospectus and to own, lease and operate its properties;
(ii) each of the Company and each Subsidiary is duly qualified and is in good standing as a foreign corporation authorized to do business in each jurisdiction identified in Schedule __ hereto;
(iii) all the outstanding shares of capital stock of the Company have been duly authorized and validly issued and are fully paid, non-assessable and not subject to any preemptive or similar rights;
(iv) the Shares have been duly authorized and, when issued and delivered to the Underwriters against payment therefor as provided by this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of such Shares will not be subject to any preemptive or similar rights;
(v) all of the outstanding shares of capital stock of each Subsidiary have been duly authorized and validly issued and are fully paid and non-assessable, and are owned by the Company, directly or indirectly through one or more subsidiaries, and have not been issued in violation of any statutory preemptive rights or the Subsidiary's Certificate of Incorporation, and to our knowledge, such shares are also owned
19

beneficially by the Company and are free and clear of all adverse claims, limitations on voting rights, options and other encumbrances;
(vi) this Agreement has been duly authorized, executed and delivered by the Company;
(vii) the authorized capital stock of the Company conforms as to legal matters to the description thereof contained in the Prospectus;
(viii) the Registration Statement has become effective under the Act, and such counsel is not aware of any stop order suspending its effectiveness and no proceedings for that purpose are, to the best of such counsel's knowledge after due inquiry, pending before or contemplated by the Commission;
(ix) the statements under the captions "Risk Factors", "Management's Discussion and Analysis of Financial Condition and Results of Operations", "Business", "Management", "Related Party Transactions", "Description of Capital Stock", "Shares Eligible for Future Sale" and "Underwriting" in the Prospectus and Items 14 and 15 of Part II of the Registration Statement, insofar as such statements constitute a summary of the legal matters, documents or proceedings referred to therein, except as pertaining to matters of intellectual property (including without limitation matters of patents, licenses and trade secrets) fairly present the information called for with respect to such legal matters, documents and proceedings referred to therein in all material respects;
(x) to such counsel's knowledge, neither the Company nor any of the Subsidiaries is in violation of its respective charter or by-laws and, to the best of such counsel's knowledge after due inquiry, neither the Company nor any Subsidiary is in default in the performance of any obligation, agreement, covenant or condition contained in any indenture, loan agreement, mortgage, lease or other agreement or instrument, of which counsel is aware, that is material to the Company and its subsidiaries, taken as a whole, to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or their respective property is bound;
(xi) the execution, delivery and performance of this Agreement by the Company, the compliance by the Company with all the provisions hereof and the consummation of the transactions contemplated hereby will not (A) require any consent, approval, authorization or other order of, or qualification with, any court or governmental body or agency (except such as may be required under the securities or Blue Sky laws of the various states), (B) conflict with or constitute a breach of any of the terms or provisions of, or a default under, the charter or by-laws of the Company
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or any Subsidiary or any indenture, loan agreement, mortgage, lease or other agreement or instrument, of which such counsel is aware, that is material to the Company and its Subsidiaries, taken as a whole, to which the Company or any Subsidiary is a party or by which the Company or any Subsidiary or their respective property is bound, or (C) violate or conflict with any applicable law or any rule, regulation, judgment, order or decree of any court or any governmental body or agency having jurisdiction over the Company, any of its subsidiaries or their respective property;
(xii) to such counsel's knowledge, there are no legal or governmental proceedings pending or overtly threatened to which the Company or any Subsidiary is a party or to which any of their respective property is subject that are required to be described in the Registration Statement or the Prospectus and are not so described or any contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not so described or filed as required;
(xiii) the Company is not and, after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Prospectus, will not be, an "investment company" as such term is defined in the Investment Company Act of 1940, as amended;
(xiv) to the best of such counsel's knowledge after due inquiry, except as disclosed in the prospectus, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement; and
(xv) Such counsel has participated in conferences with directors, officers and other representatives of the Company, representatives of the independent public accountants for the Company, representatives of the Underwriters and representatives of counsel for the Underwriters, at which conferences the contents of the Registration Statement and the Prospectus and related matters were discusses, and, although such counsel has not independently verified and is not passing upon and assumes no responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement and Prospects (except to the extent specified in the foregoing opinion), no facts have come to such counsel's attention which leads such counsel to believe that the Registration Statement, on the effective date thereof, contained and untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements contained therein not misleading or that the Prospectus, on the date thereof or on the date
21

hereof, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact required to be stated therein or necessary to make the statements contained therein, in light of the circumstances under which they were made, not misleading (it being understood that we express no view with respect to the financial statements and related notes, the financial statement schedules and the other financial, statistical and accounting data included in the Registration Statement or Prospectus).
The opinion of Weil, Gotshal & Manges LLP described in Section 9(e) above shall be rendered to you at the request of the Company and shall so state therein.
(f) You shall have received on the Closing Date an opinion (satisfactory to you and counsel for the Underwriters), dated the Closing Date, of Hodgson, Russ, Andrews, Woods & Goodyear LLP, local counsel for the Company, to the effect that:
(i) there have come to such counsel's attention no facts that lead such counsel to believe that the Registration Statement or that the Prospectus contains an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements contained therein, in light of the circumstances under which they were made, not misleading, with respect to (1) any Intellectual Property of the Company or (2) any license agreement relating to any Intellectual Property of the Company;
(ii) such counsel has no knowledge that, other than as stated in the Registration Statement and the Prospectus, there is any material pending or threatened action against the Company relating to (1) any Intellectual Property of the Company or (2) any license agreement relating to any Intellectual Property of the Company;
(iii) such counsel has no knowledge that the Company does not take measures that the Company reasonably believes to be adequate to prevent material adverse effects upon the Company by creating, maintaining, protecting, and realizing reasonable value from the material Intellectual Property of the Company and from current material license and other agreements between the Company and others;
(iv) such counsel has no knowledge that any license agreement listed as an Exhibit in the Registration Statement was not duly executed or is not valid in accordance with its terms or that the Company is in default (declared or undeclared), except as otherwise disclosed, in connection with any material provision of any such license agreement, and there have come to such counsel's attention no facts that lead such counsel to believe
22

that any such license agreement to which the Company is a party is not enforceable;
(v) such counsel has no knowledge that, other than as stated in the Registration Statement and the Prospectus, there is any pending or threatened legal proceeding asserting a material breach or default by the Company relating to (1) any Intellectual Property of the Company or (2) any license agreement relating to any Intellectual Property of the Company;
(vi) such counsel has no knowledge that the Company does not possess the Intellectual Property and licenses to Intellectual Property that are currently believed by the Company to be necessary for the conduct of the business of the Company as described in the Registration Statement and the Prospectus;
(vii) such counsel has no knowledge, that the Company is not an owner of record in the appropriate governmental agency of any Intellectual Property of the Company that is currently believed by the Company to be necessary for the conduct of the business, of the Company as described in the Registration Statement and the Prospectus and for which the Company does not otherwise hold rights through an express license or agreement;
(viii) such counsel has no knowledge that any Intellectual Property of the Company currently believed by the Company to be necessary for the conduct of the business of the Company as described in the Registration Statement and the Prospectus is unenforceable or invalid owing to a statutory bar arising out of the acts or omissions of the Company, or that any lien has been filed against any such Intellectual Property;
(ix) the statements under the subcaption "Patents and Proprietary Technology", under the caption "Business" in the Prospectus, insofar as such statements constitute a summary of the legal matters, documents or proceedings referred to therein fairly present the information called for with respect to such legal matters, documents and proceedings referred to therein in all material respects.
The opinion of Hodgson, Russ, Andrews, Woods & Goodyear LLP described in
Section 9(f) above shall be rendered to you at the request of the Company and shall so state therein.
(g) You shall have received on the Closing Date an opinion, dated the Closing Date, of Akin, Gump, Strauss, Hauer & Feld, L.L.P., counsel for the Underwriters, as to the matters referred to in Sections 9(e)(iv), 9(e)(vi), 9(e)(ix)
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(but only with respect to the statements under the caption "Description of Capital Stock" and "Underwriting") and 9(e)(xvii).
In giving such opinions with respect to the matters covered by Section
9(e)(xvii), Weil, Gotshal & Manges LLP and Akin, Gump, Strauss, Hauer & Feld, L.L.P. may state that their opinion and belief are based upon their participation in the preparation of the Registration Statement and Prospectus and any amendments or supplements thereto and review and discussion of the contents thereof, but are without independent check or verification except as specified.
(h) You shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to you, from Deloitte & Touche LLP, independent public accountants, containing the information and statements of the type ordinarily included in accountants' "comfort letters" to Underwriters with respect to the financial statements and certain financial information contained in the Registration Statement and the Prospectus.
(i) The Company shall have delivered to you the agreements specified in
Section 2 hereof which agreements shall be in full force and effect on the Closing Date.
(j) The Shares shall have been duly listed, subject to notice of issuance, on the NYSE.
(k) The Company shall not have failed on or prior to the Closing Date to perform or comply with any of the agreements herein contained and required to be performed or complied with by the Company on or prior to the Closing Date.
The several obligations of the Underwriters to purchase any Additional Shares hereunder are subject to the delivery to you on the applicable Option Closing Date of such documents as you may reasonably request with respect to the good standing of the Company, the due authorization and issuance of such Additional Shares and other matters related to the issuance of such Additional Shares.
SECTION 9. EFFECTIVENESS OF AGREEMENT AND TERMINATION. This Agreement shall become effective upon the execution and delivery of this Agreement by the parties hereto.
This Agreement may be terminated at any time on or prior to the Closing Date by you by written notice to the Company if any of the following has occurred: (i) any outbreak or escalation of hostilities or other national or international calamity or crisis or change in economic conditions or in the financial markets of the United States or elsewhere that, in your judgment, is material and adverse and, in your judgment, makes it impracticable to market the
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Shares on the terms and in the manner contemplated in the Prospectus, (ii) the suspension or material limitation of trading in securities or other instruments on the NYSE, the American Stock Exchange, the Chicago Board of Options Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade or the Nasdaq National Market or limitation on prices for securities or other instruments on any such exchange or the Nasdaq National Market, (iii) the suspension of trading of any securities of the Company on any exchange or in the over-the-counter market, (iv) the enactment, publication, decree or other promulgation of any federal or state statute, regulation, rule or order of any court or other governmental authority which in your opinion materially and adversely affects, or will materially and adversely affect, the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole, (v) the declaration of a banking moratorium by either federal or New York State authorities or (vi) the taking of any action by any federal, state or local government or agency in respect of its monetary or fiscal affairs which in your opinion has a material adverse effect on the financial markets in the United States.
If on the Closing Date or on an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase the Firm Shares or Additional Shares, as the case may be, which it has or they have agreed to purchase hereunder on such date and the aggregate number of Firm Shares or Additional Shares, as the case may be, which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the total number of Firm Shares or Additional Shares, as the case may be, to be purchased on such date by all Underwriters, each non-defaulting Underwriter shall be obligated severally, in the proportion which the number of Firm Shares set forth opposite its name in Schedule I bears to the total number of Firm Shares which all the non-defaulting Underwriters have agreed to purchase, or in such other proportion as you may specify, to purchase the Firm Shares or Additional Shares, as the case may be, which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; PROVIDED that in no event shall the number of Firm Shares or Additional Shares, as the case may be, which any Underwriter has agreed to purchase pursuant to Section 2 hereof be increased pursuant to this Section 9 by an amount in excess of one-ninth of such number of Firm Shares or Additional Shares, as the case may be, without the written consent of such Underwriter. If on the Closing Date any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be purchased by all Underwriters and arrangements satisfactory to you and the Company for purchase of such Firm Shares are not made within 48 hours after such default, this Agreement will terminate without liability on the part of any non-defaulting Underwriter and the Company. In any such case which does not result in termination of this Agreement, either you or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement and the Prospectus or any other
25

documents or arrangements may be effected. If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such date, the non-defaulting Underwriters shall have the option to
(i) terminate their obligation hereunder to purchase such Additional Shares or
(ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to purchase on such date in the absence of such default. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of any such Underwriter under this Agreement.
SECTION 10. MISCELLANEOUS. Notices given pursuant to any provision of this Agreement shall be addressed as follows: (i) if to the Company, to Wilson Greatbatch Technologies, Inc., 10,000 Wehrle Drive, Clarence, New York, 14031 and (ii) if to any Underwriter or to you, to you c/o Donaldson, Lufkin & Jenrette Securities Corporation, 277 Park Avenue, New York, New York 10172, Attention: Syndicate Department or in any case to such other address as the person to be notified may have requested in writing.
The respective indemnities, contribution agreements, representations, warranties and other statements of the Company and the several Underwriters set forth in or made pursuant to this Agreement shall remain operative and in full force and effect, and will survive delivery of and payment for the Shares, regardless of (i) any investigation, or statement as to the results thereof, made by or on behalf of any Underwriter, the officers or directors of any Underwriter, any person controlling any Underwriter, the QIU Indemnified Party, the Company, the officers or directors of the Company or any person controlling the Company, (ii) acceptance of the Shares and payment for them hereunder and
(iii) termination of this Agreement.
If for any reason the Shares are not delivered by or on behalf of the Company as provided herein (other than as a result of any termination of this Agreement pursuant to Section 9), the Company agrees to reimburse the several Underwriters for all out-of-pocket expenses (including the fees and disbursements of counsel) incurred by them. Notwithstanding any termination of this Agreement, the Company shall be liable for all expenses which it has agreed to pay pursuant to Section 5(i) hereof. The Company also agrees to reimburse the several Underwriters, their directors and officers and any persons controlling any of the Underwriters for any and all fees and expenses (including, without limitation, the fees disbursements of counsel) incurred by them in connection with enforcing their rights hereunder (including, without limitation, pursuant to Sections 7 and 8 hereof).
Except as otherwise provided, this Agreement has been and is made solely for the benefit of and shall be binding upon the Company, the Underwriters, the
26

Underwriters' directors and officers, any controlling persons referred to herein, the QIU Indemnified Party, the Company's directors and the Company's officers who sign the Registration Statement and their respective successors and assigns, all as and to the extent provided in this Agreement, and no other person shall acquire or have any right under or by virtue of this Agreement. The term "successors and assigns" shall not include a purchaser of any of the Shares from any of the several Underwriters merely because of such purchase.
This Agreement shall be governed and construed in accordance with the laws of the State of New York.
This Agreement may be signed in various counterparts which together shall constitute one and the same instrument.
27

Please confirm that the foregoing correctly sets forth the agreement between the Company and the several Underwriters.
Very truly yours,
WILSON GREATBATCH TECHNOLOGIES, INC.
By:

Name:
Title:
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MERRILL LYNCH, PIERCE,
FENNER & SMITH INCORPORATED
BANC OF AMERICA SECURITEIS LLC
U.S. BANCORP PIPER JAFFRAY, INC.
DLJDIRECT INC.
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto
By DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By:
 Name:
Title:

28

SCHEDULE I

Underwriters                                            Number of Firm Shares
                                                          to be Purchased

Donaldson, Lufkin & Jenrette Securities
     Corporation
Merrill Lynch, Pierce, Fenner & Smith Incorporated.
Banc of America Securities LLC
U.S. Bancorp Piper Jaffray Inc.
DLJDIRECT Inc.

TOTAL                                                          =========	

1

Annex I
[NAMES OF STOCKHOLDERS OF THE COMPANY WHO WILL BE REQUIRED TO SIGN LOCK UPS TO COME]
2

EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Amendment No. 5 to Registration Statement No. 333-37554 of Wilson Greatbatch Technologies, Inc. of our report dated January 21, 2000 (March 14, 2000 as to Note 18 and August 15, 2000 as to the effects of the reverse stock splits described in Note 1) appearing in the Prospectus, which is a part of such Registration Statement, and of our report dated January 21, 2000 (March 14, 2000 as to Note 18 and August 15, 2000 as to the effects of the reverse stock splits described in Note 1) relating to the financial statement schedule appearing elsewhere in such Registration Statement.
We also consent to the reference to us under the headings "Selected Consolidated Financial Data" and "Experts" in such Prospectus.
DELOITTE & TOUCHE LLP
Buffalo, New York
August 25, 2000

EXHIBIT 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have issued our reports dated September 22, 1998, accompanying the financial statements of Hittman Materials and Medical Components, Inc. contained in the Registration Statement and Prospectus. We consent to the use of the aforementioned reports in the Registration Statement and Prospectus, and to the use of our name as it appears under the caption "Experts."

/s/ Grant Thornton LLP

Baltimore, Maryland
August 25, 2000