Wednesday January 3, 9:35 am Eastern Time
Press Release
--SAGE-- Solomon Alliance Group, Inc. Acquires DRN, LLC
Enters Into Agreement For Up To $10,000,000 Of Equity Financing
ATLANTA--(BUSINESS WIRE)--Jan. 3, 2001--Solomon Alliance Group, Inc. (OTCBB:SAGE - news) today announced that it has acquired DRN, LLC, an operating company that supplies equipment and services for telecommunications projects in numerous countries.
In addition, Solomon announced that it has entered into a Letter of Agreement for a minimum of $5 million equity financing with an option for an additional $5 million from IFG Private Equity, LLC, an Atlanta-based institutional investor.
DRN Subsidiary of Solomon
As announced by Solomon in a prior press release, DRN deals in communications equipment used for fiber, satellite, and wireless communications. Products sold include multiplexing equipment, satellite modems and transceivers, DSL modems, routers, T1 channel banks, CSU/DSU, custom cabling solutions, VSAT equipment and call supervision equipment.
DRN enjoys competitive pricing from its vendors, including Phillips Communications & Equipment, Verestar, RevCom, Kent Datacomm, PairGain/ADC and Cisco Systems.
DRN acts as the procurement and sales agent for Denwa Communications, Inc., a multinational firm that acts as a principal or manager of telecommunications projects in over 20 countries. Denwa has entered into a Strategic Alliance Agreement with Solomon.
DRN acts as a reseller offering competitive pricing to fulfill individual project needs for global network deployments, and functions as a key member of the ``turn-key'' systems integration team for each project by supplying the necessary equipment with professional installation and turn-up services.
DRN has recently expanded its services to include VSAT and technical installation and repair services for satellite Earth Stations and other systems.
Equity Financing
Under the terms of a Letter of Agreement for an equity line executed with the Solomon Group on December 30, 2000, IFG Private Equity, LLC has agreed to purchase from Solomon up to $10 million of Solomon's common stock over the next 36-month period. Solomon has structured this agreement to operate similar to a line of credit, allowing Solomon to draw upon funds periodically when and if desired.
The funding is subject to certain items including completion of due diligence and finalization of documents. Solomon intends to utilize this financing to provide resources for an aggressive expansion of the revenue-generating activities of DRN and to provide funding for future acquisitions and operations of the Company.
Tom Weston, President & CEO of Solomon Alliance Group, Inc., stated, ``We are very pleased that we were successful in completing the acquisition of DRN on the 29th of December 2000. While we are firmly convinced that the acquisition of DRN is of great strategic importance to the Company, regardless of date of purchase, we believe that our completion of the transaction prior to year end will provide additional benefits to our shareholders.''
Mr. Weston explained, ``Because our Annual Report for 2000 will now include DRN's revenues of approximately $1,500,000, we anticipate that future investors, shareholders and acquisition candidates will more favorably assess Solomon's future growth plans and its valuation when performing their due diligence review of the Company.''
``Our goal has been for Solomon to become a premier wireless data solutions provider and to expand into other segments of the telecommunications industry through selected acquisitions and joint ventures,'' Mr. Weston continued.
``As we have indicated in the past, we have been reviewing a number of potential business combinations and relationships since becoming an SEC reporting company in early 2000. One of our principal objectives has been to leverage the value-added benefits of each new relationship in order to take advantage of the resulting synergy between the companies. Through its Master Purchase Agreement with Global Wireless Data, Solomon currently has the capability to deliver a large selection of wireless modems, devices and applications. Recently Solomon has taken action to expand its potential sales capabilities. The acquisition of DRN adds a strategic 'land-based' component to Solomon's planned 'comprehensive wireless solution' by providing a broad range of fiber, satellite, and wireless communications equipment and installation services.''
Mr. Weston added, ``We will continue our policy of considering transactions only if they are likely to increase revenue or assets and if they are likely to complement and leverage Solomon's existing or planned activities. We believe that this approach is consistent with our objectives of qualifying Solomon for trading on the NASDAQ SmallCap and maximizing valuation per share for our shareholders based on both a financial statement and a going concern analysis.''
Shareholders are requested to refrain from contacting any of the parties indicated herein. Unauthorized contact is detrimental to Solomon's business activities. Further information on Denwa Communications, Inc. is available by visiting their web site denwa.com.
Further information on Solomon Alliance Group, Inc. is available by contacting Barry Labell of Investor Communications Company at 800/550-5165 or by visiting their Web site iccinfo.com. Please register at the ICC Web site to receive current information and press releases on Solomon Alliance Group, Inc.
This news release may contain certain ``forward-looking statements'' within the meaning of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included in this release, including, without limitation, statements regarding future plans and objectives of Solomon are forward-looking statements that involve various risks and uncertainties.
There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.
Important factors that could cause actual results to differ materially from the Company's expectations are disclosed under the heading ``Risk Factors'' and elsewhere in documents filed from time to time with the Securities and Exchange Commission and other regulatory authorities.
The Securities and Exchange Commission has not reviewed this release and does not accept responsibility for the adequacy or accuracy of this news release.
k2go.com
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Contact:
Solomon Alliance Group
by
Investor Communications Co.
Barry Labell, 800/550-5165
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