Streaming related investment in a competitor (?)
iBEAM Broadcasting Announces Completion of $40 Million Investment; Company
Also Announces Board of Directors and Management Changes
SUNNYVALE, Calif.--(BUSINESS WIRE)--July 11, 2001--iBEAM Broadcasting(R)
Corp. (Nasdaq:IBEM), a leading provider of streaming communications
solutions, announced today that it has completed the previously announced
strategic partnership and funding transaction with four investors
including Williams Communications (NYSE:WCG), a leading provider of
broadband services for bandwidth-centric customers, under which the
investors have provided iBEAM $40 million in cash and services. The other
investors are Allen & Company Incorporated, who acted as financial advisor
to Williams Communications in the transaction, TouchAmerica Inc., and Lunn
iBEAM, LLC.
Peter Desnoes, chairman, president, and CEO of iBEAM, said, "We are very
pleased to have established this strategic partnership with Williams
Communications and obtained the funding needed to continue providing
superior quality streaming products and services to our customers. We look
forward to leveraging Williams Communications' extensive international
fiber optic network and broadband and reseller services to capitalize on
new opportunities for our world-class streaming solutions."
Under the terms of the agreement, iBEAM issued and sold 2,400,939 shares
of convertible preferred stock for a total purchase price of $30 million
in cash, plus an in-kind contribution of services by Williams
Communications valued at $10 million, for total consideration of $40
million. The preferred stock votes with the common stock on an as
converted basis and is initially convertible into 240,093,900 shares of
common stock of iBEAM, representing approximately 65% of iBEAM's
outstanding voting stock. Williams Communications holds preferred stock
initially convertible into 49% of iBEAM's outstanding voting stock.
iBEAM requested and obtained an exception to the shareholder approval
requirements and a waiver of the voting rights rules from The Nasdaq Stock
Market, citing the company's immediate need for the funds.
In connection with the completion of the transaction, four new members
were appointed to iBEAM's Board of Directors: Howard Janzen, President and
CEO, Williams Communications; John Bumgarner, President of Strategic
Investments, Williams Communications; Laura Kenny, President of Vyvx, a
subsidiary of Williams Communications, and Paul Gould, Managing Director
of Allen & Company. Following the resignations of two iBEAM Board members,
Rich Shapero, Managing Partner of Crosspoint Ventures Partners and J.
Peter Wagner, General Partner of Accel Partners, both part of iBEAM's
original venture funding group, iBEAM's board of directors now has nine
members.
In connection with the completion of the transaction, iBEAM also announced
several senior management changes, reflecting the company's increased
focus on its two key markets: Enterprise and Entertainment. Robert Davis,
previously Senior Vice President of Sales, has been appointed President of
Entertainment Services. Nicholas Balletta, previously Senior Vice
President and General Manager of Enterprise Services, has been appointed
President of Enterprise Services. Kurt Hoffman, formerly Chief Operating
Officer, and Thomas Gillis, formerly Senior Vice President and General
Manager of Entertainment Services, have resigned from the company.
Further, Geoff Ribar, Chief Financial Officer, has announced his plans to
resign from the company as of August 1, 2001. A search for his replacement
is currently underway.
The investment banking firms of Morgan Stanley & Co. and Dresdner
Kleinwort Wasserstein advised iBEAM on the transaction.
About iBEAM Broadcasting Corp.
iBEAM Broadcasting(R) Corp. (Nasdaq:IBEM - news), founded in 1998, is a
leading provider of streaming communications solutions. iBEAM's end-to-end
solutions for enterprise and media customers include interactive
webcasting, streaming advertising insertion, syndication and pay-per-view
management, and secure, licensed download and geographical identification
applications. iBEAM currently delivers more than 100 million audio and
video streams per month across its intelligent distribution network of
satellite connected, high-performance servers located in more than 210
networks around the world. Several hundred innovative companies use
iBEAM's global services including media leaders, CNBC, MTVi, and
LAUNCH.com, and enterprise customers IBM/Lotus, Bristol-Myers Squibb, and
Merrill Lynch. iBEAM is headquartered in Sunnyvale, Calif.
iBEAM's Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995
The statements contained in this release are forward-looking statements.
Actual results may differ materially from those anticipated in any
forward-looking statement as a result of certain risks and uncertainties,
including, without limitation, the success of the business relationship
between iBEAM and Williams Communications, the impact of the substantial
dilution resulting from the transaction on the trading price of iBEAM's
common stock; iBEAM's ability to obtain additional funding, increase its
revenues and expand its customer base, reduce its capital expenditures and
other operating expenses, improve its gross margins and reduce its cash
consumption; iBEAM's ability to remain listed on the Nasdaq National
Market, the early stage of iBEAM's operating history and the industry for
Internet broadcast services, the impact of competition; and the
desirability of iBEAM's new and existing products and services in the
market. For other risks and uncertainties applicable to iBEAM's business,
investors are encouraged to refer to iBEAM's most recent Form 10-Q, Forms
8-K and Form 10-K filed with the Securities and Exchange Commission. |
