Spacetec and Labtec Agree to Waive Right to Contingent Shares
LOWELL, Mass., Feb. 3 /PRNewswire/ -- Spacetec IMC Corporation announced today that it had reached agreement with Labtec Inc. whereby, as part of their pending merger, Labtec irrevocably waived the right to the issuance of contingent shares of Spacetec common stock to Labtec stockholders based on a valuation of the industrial business of Spacetec. As a result, subject to the approval of the Spacetec stockholders of the matters being submitted at the
February 17, 1999 stockholders meeting, each share of common stock of Labtec shall be converted into approximately .554 shares of Spacetec common stock and a pro-rata share of all payments made under a $1,065,000 promissory note. There will be no adjustment in the
number of shares issuable to Labtec because of a subsequent valuation of the Spacetec industrial business. George Rea, Acting Chief Executive Officer of Spacetec said, ''The steps taken over the past several months to bring the overhead and expense structure of Spacetec, including the industrial business, into line with revenues resulted in a modest profit for the quarter ending December 31, 1998 (excluding one-time expenses). We are pleased that Labtec has agreed to waive its right to the issuance of additional shares and further dilution of Spacetec stockholders. Following the merger with Labtec, Spacetec stockholders will own approximately 33% of the combined company.''
Marc Leder, Co-chairman of Labtec said, ''We have worked closely with Spacetec since October in an effort to better understand the industrial business and believe that the combined company will be strengthened by the industrial business. The steps taken in the past several months along with the expected benefits of the merger have convinced us to forego the extensive and disruptive valuation process originally contemplated by the merger agreement and concentrate on achieving the expected benefits of the merger. This will accrue to the benefit of both the Spacetec and the Labtec stockholders.''
Mr. Rea commented, ''We are looking forward to the special stockholders meeting to be held February 17, 1999 in Boston to approve the matters relating to the completion of the merger with Labtec and urge our stockholders to return their proxy ballots promptly.''
About Spacetec IMC Corporation
Based in Lowell, Massachusetts, Spacetec IMC Corporation is a leading provider of
interactive input controllers and software technology for use with 3D graphical applications. The
markets served by Spacetec are: Mechanical - CAD, Design Engineering, Digital Content
Creation, Corporate Desktop and Consumer End Use. Today, its products and technology are
used in diverse applications ranging from designing parts for leading worldwide manufacturers
such as Boeing, General Motors and Honda Motor Company to controlling the navigation of
NASA's Sojourner Rover on Mars from 200 million miles away, as well as allowing computer
games to perform extraordinary maneuvers in 3D games. For additional information, please call
978-275-6100, or visit the Spacetec Web site at: www.spacetec.com.
Risk Factors Associated with Acquisition
This release, as it relates to the proposed acquisition, contains forward-looking statements that
are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act
of 1995. If the acquisition is completed, there can be no assurance that the combined
companies can successfully integrate the acquired businesses, products or technologies. The
integration of the acquired business may cause a diversion of management time and reallocation
of resources. There can be no assurance that the Spacetec 3D controller technology can be
successfully integrated with Labtec's product line and manufacturing and distribution
infrastructure, or that further product development will be required to integrate Spacetec's
products with those of Labtec. Investors are cautioned that all forward-looking statements
involve risks related to the market acceptance of and demand for the combined company's
products, new product development, impact of competitors, and dependence on third-party
distribution channels.
SOURCE: Spacetec IMC Corporation
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