OTTAWA, ONTARIO--(Marketwire - July 12, 2012) -
Attn: Business/High-Tech Editors
International Datacasting Corporation (TSX:IDC) ("IDC" or the "Company") responded today to certain statements in the dissident proxy circular filed by Mr. Adam Adamou in connection with the Company's upcoming meeting of shareholders to be held on July 31, 2012. The current directors (other than Mr. Adamou) and management of IDC wish to correct certain misinformation and omissions in Mr. Adamou's circular:
- Mr. Adamou's circular states that his business acquisition strategy ("BAQ") was "short-lived" and implies that the strategy was in effect for two months only, from July 12, 2011 to September 7, 2011. This is factually incorrect. IDC pursued Mr. Adamou's BAQ strategy, without success, from December 2010 through to and including June 2012.
- Mr. Adamou's circular fails to disclose the costs of the business acquisition strategy to IDC. Under Adam's leadership, the BAQ strategy has cost IDC a total of $871,658. $239,597 of this amount, including $18,750 in fees to Mr. Adamou, was incurred in the current quarter.
- This $239,597 cost, which will significantly affect IDC's earnings in the current quarter ending on July 31, 2012, was incurred in negotiating a transaction that was sourced and principally negotiated by Mr. Adamou under the auspices of the BAQ. This transaction ultimately failed as it was rejected by the other party. During the course of the BAQ, several other transactions were considered by Mr. Adamou's Investment Committee, but were not put forward to the full Board for consideration.
- Mr. Adamou was in fact terminated as Executive Chairman of IDC, in part as a result of his record of execution on the BAQ. As an accommodation to Mr. Adamou, he was permitted to resign his employment instead.
- Mr. Adamou's circular states that his director nominees are aligned with his strategy. In fact, Jim Hall, one of Mr. Adamou's nominees, supported Mr. Adamou's termination as Executive Chairman, was one of the lead proponents of de-emphasizing the BAQ, and resigned as a director of IDC immediately before being called upon to vote on the transaction that ultimately failed.
- Mr. Adamou's circular fails to identify a principal occupation for either Mr. Adamou or his nominee Robert Mimeault, as required under applicable securities laws. IDC's information is that neither Mr. Adamou nor Mr. Mimeault currently have a principal occupation. We note that Mr. Adamou's circular calls for IDC to "hire experts to execute" his acquisition strategy. We ask that Mr. Adamou publicly state his intentions about assuming a senior executive position at IDC, or otherwise causing IDC to retain his services or the services of Mr. Mimeault, should his slate prove to be successful in the upcoming election. For the record, over the two year period ending July 31, 2012, the direct cost to IDC of Mr. Adamou's involvement has been $632,061, which includes his salary, severance, hotel and food costs while in Ottawa and other ancillary costs associated with the BAQ. This is separate from the $18,750 in fees Mr. Adamou earned related to the above noted failed transaction. The potential benefits of the BAQ should be weighed against the direct and indirect costs to IDC.
- Mr. Adamou's circular does not clearly state that most of his IDC shares were acquired with a $552,000 shareholder loan from IDC. Mr. Adamou is the only current director, officer or employee of IDC who has received the benefit of a share purchase loan. IDC's Board has the ability to call Mr. Adamou's shareholder loan 90 days after he ceases to be a director.
Del Lippert, one of the directors of IDC, stated "Regardless of which side prevails in this election, the current Board and management feel that it is important that the facts of the BAQ, Mr. Adamou's plans and the costs to the Company are understood. The shareholders of IDC deserve to make an informed decision."
IDC also wishes to address confusion caused by Mr. Adamou's proxy solicitation campaign. Mr. Adamou's use of IDC's name, logo and customer brand in his social media campaign are unauthorized. IDC has invested in its logo and branding to support its digital content distribution business, and the logo and branding should only be used for that purpose. Shareholders are also advised that on July 9, 2012, Mr. Adamou made an unauthorized filing on SEDAR under IDC's profile, which has now been removed by the Ontario Securities Commission.
About International Datacasting Corporation:
International Datacasting Corporation (TSX:IDC) is a global leader in digital content distribution for the world's premiere broadcasters in radio, television, data and digital cinema. IDC offers a broad portfolio of advanced solutions including Pro Audio, Pro Video, Pro Cinema, and Pro Data for implementing broadcast content contribution and distribution applications. IDC's products and solutions are in demand for radio and television networks, digital cinema, 3D live events, ad insertion, satellite news gathering, sport contribution, ad insertion, VOD, and IPTV among others. IDC is headquartered in Ottawa, Canada, with regional offices in Arnhem, the Netherlands and in San Diego, California. IDC has installations in over 100 countries and service offices in Australia, Singapore and China with an international network of value-added partners and distributors.
This press release contains forward-looking statements reflecting IDC's objectives, estimates and expectations, including statements about expected financial impacts. All of these forward-looking statements are subject to risks and uncertainties. IDC's actual results, performance, achievements and developments may differ materially from the results, performance, achievements or developments expressed or implied by such statements. Factors that might cause actual results to differ materially include, but are not limited to, competitive developments; risks associated with IDC's growth; any difficulties with integrating acquired product lines into IDC's business and/or manufacturing procedures; any difficulties or disputes with IDC's subcontractors, contract manufacturers and suppliers; IDC's dependence on the development and growth of the satellite datacasting market; a lengthy and variable sales cycle for IDC's products and services; IDC's reliance on a small number of customers for a large percentage of its revenue; regulatory risks and intellectual property infringement. IDC assumes no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof, except as expressly required by applicable law. Forward-looking statements are provided to assist external stakeholders in understanding the current Board and management's expectations as at the date of this release and may not be appropriate for other purposes. Readers are cautioned not to place undue reliance on such statements. More detailed information about potential factors that could affect IDC's financial and business results is included in the public documents IDC files from time to time with Canadian securities regulatory authorities and which are available on SEDAR at www.sedar.com, including, without limitation, IDC's Annual Information Form dated April 30, 2012.
In connection with the solicitation of proxies, management of IDC has filed on SEDAR a management proxy circular and other relevant documents. The management proxy circular contains important information about IDC and the 2012 Annual General Meeting. In connection with the 2012 Annual General Meeting, IDC has mailed its management proxy circular to shareholders.