ON TECHNOLOGY News Release
For Immediate Release
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Contact: ON Technology Investor Relations:
Daniel M. Sanders Cynthia DeMonte
781-487-3335 DeMonte Associates
212-473-3700
[email protected]
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ON TECHNOLOGY ANNOUNCES AGREEMENT WITH PRIVATE INVESTORS
WALTHAM, MA, DECEMBER 19, 2000 - ON Technology (NASDAQ: ONTC), a leading
provider of remote software delivery solutions, today announced that the Company
has favorably negotiated the surrender of its potentially highly dilutive
warrants, held by Marshall Capital Management Inc., an affiliate of Credit
Suisse First Boston, and Castle Creek Technology Partners LLC, in exchange for
new warrants exercisable into 2,800,000 shares of the Company's Common Stock
(1,400,000 shares per investor). Each investor has agreed to exercise its
warrants in part into approximately 350,000 shares (approximately 700,000 in
total) within 8 days after the issue date of the warrants. The Company also
issued a limited contingent unsecured note with a principal balance of $500,000
to each investor.
The new agreement fixes the number of shares issuable upon exercise of the
warrants and eliminates the 4-year overhang that would have resulted from the
original warrant agreement. In addition, the new agreement protects ON
Technology shareholders from the very substantial dilution that would have
occurred from exercise of the warrants held by these institutional investors
under the original agreement. Based on recent share price, the new agreement
results in a dilution of only 19.7% compared to approximately 70.0% that would
have resulted from the warrant exercise.
"We're extremely pleased to have reached this agreement with our private
investors," said Robert L. Doretti, Chairman, President and CEO of ON
Technology. "Our recent stock price does not accurately reflect the value of the
company. The agreement fixes the number of shares owned by the investors and
removes a potential 4-year dilutive overhang. This allows shareholders to focus
on business fundamentals and value the company based solely on its business
performance."
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ON TECHNOLOGY ANNOUNCES AGREEMENT WITH PRIVATE INVESTORS -- PAGE 2 OF 2
Mr. Doretti continued: "I'd also like to extend my thanks to Marshall Capital
Management and Castle Creek Technology Partners for working closely with ON
Technology to mutually resolve the overhang and allow us to continue focusing on
our core business."
ABOUT ON TECHNOLOGY CORPORATION
ON Technology empowers IT organizations and service providers to rapidly deliver
business-critical software to a range of remote computing devices including
desktops, mobile PCs, handhelds and servers. The company's flagship product, ON
Command CCM(TM), has been judged by analysts, product reviewers, enterprise IT
customers and service providers as the industry's best solution for remote
software delivery. ON Command CCM is currently being used to deliver software to
over 500,000 corporate computing devices worldwide in over 500 leading Global
2000 corporations such as WorldCom, Deutsche Telecom and Goodyear Tire & Rubber.
Application Service Providers (ASPs) and Management Service Providers (MSPs) are
also using ON Command CCM to deliver high-value outsourced IT services more
quickly and cost-effectively while expediting their clients' technology
upgrades. For more information, visit ON Technology's web site at www.on.com or
call 800-767-6638.
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ON Technology and the ON logo are registered trademarks and ON Command CCM is a
trademark of ON Technology Corporation. All other brand names and trademarks are
properties of their respective owners.
The statements in this news release that relate to future plans, events or
performance are forward-looking statements that involve risks and uncertainties,
including risks associated with uncertainties pertaining to customer orders,
demand for products and services, development of markets for the Company's
products and services and other risks identified in the Company's SEC filings.
Actual results, events and performance may differ materially. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date hereof. The Company undertakes no obligation to
release publicly the result of any revisions to these forward-looking statements
that may be made to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
