Exhibit 99.1
RELEASE DATE: JANUARY 22, 2007
FOR IMMEDIATE RELEASE
DEL GLOBAL TECHNOLOGIES CORP.
ADOPTS SHAREHOLDER RIGHTS PLAN
FRANKLIN PARK, IL, January 22, 2007 -- DEL GLOBAL TECHNOLOGIES CORP.
(DGTC) ("Del Global" or "the Company") today announced that its Board of
Directors has adopted a shareholder rights plan that is primarily designed to
protect the Company's net operating loss carryforwards ("NOLs") for tax
purposes. NOLs are past losses that a corporation can use to reduce its current
or future taxable income. The Company's ability to use the NOLs could be
substantially reduced if the Company experiences an "ownership change," as
defined under Section 382 of the Internal Revenue Code (the "Code").
"After careful consideration, the Company's Board of Directors has
determined that it is in the best interests of the Company and all of its
stockholders to adopt the rights plan at this time," said James A. Risher,
President and Chief Executive Officer of the Company. "NOLs have become an
increasingly valuable asset to the Company and its stockholders, and we hope
that the rights plan will help safeguard the availability of this asset to the
Company. However, while the rights plan has been designed to protect the NOLs to
the extent possible, it cannot ensure the protection of the NOLs."
The rights plan is designed to deter any person or group from becoming a
4.99 percent or greater beneficial owner of the Company's Common Stock. The
rights plan also discourages, with certain exceptions, existing 4.99 percent or
greater beneficial owners from acquiring any additional shares of Common Stock.
Section 382 generally restricts the use of NOLs after an "ownership change" to
an annual amount equal to the value of the company (generally measured by the
value of its outstanding stock) multiplied by the long-term tax-exempt rate. An
"ownership change" is generally a more than 50 percentage point increase in
stock ownership, during a moving 3-year testing period, by "5% shareholders".
The percentage of stock owned is calculated by dividing a person or group's
share ownership over the total stock outstanding. The terms of the rights plan
permit the Board of Directors, in its discretion, to determine that a particular
person's beneficial ownership of 4.99% or more of the Company's Common Stock
will not jeopardize or endanger the Company's NOLs, and to exempt such person's
ownership of shares from triggering the rights plan.
As part of the adoption of the rights plan, the Company's Board of
Directors declared a dividend of one right for each share of Common Stock held
of record as of the close of business on February 2, 2007 payable on February 2,
2007. The rights may cause substantial dilution to a person or group that
attempts to acquire 4.99 percent or greater of the Company's Common Stock on
terms not approved by the Board of Directors. Acquisitions of the Company's
Common Stock that would otherwise trigger the rights under the terms of the plan
are permitted where the entire Board of Directors has determined, prior to
consummation, that the transaction is fair to and in the best interests of the
Company's stockholders. In addition, the Board of Directors may redeem all but
not less than all of the rights, in its discretion, at a redemption price of
$0.01 per right at any time until the close of business on the later of (i) the
"distribution date" under the terms of the rights plan and (ii) "share
acquisition date" under the terms of the rights plan.
B-3
Additional information regarding the rights plan and the common stock
purchase rights are or will be contained in a Current Report on Form 8-K and in
a Registration Statement on Form 8-A that the Company has filed or will be
filing with the Securities and Exchange Commission (the "SEC"). These filings
will be available on the SEC's web site at WWW.SEC.GOV. In addition, the Company
will mail, as soon as practicable, a "Summary of the Rights" to its holders of
record on February 2, 2007 which will describe the material terms of the rights
plan.
Statements in this release that express a belief, expectation or
intention, as well as those which are not historical fact, are forward looking.
They involve a number of risks and uncertainties, which may cause actual results
to differ materially from such forward-looking statements. For more information
about these risks and uncertainties, please refer to the Company's annual report
on Form 10-K for the fiscal year ended July 29, 2006, and other filings with the
Securities and Exchange Commission.
ABOUT DEL GLOBAL TECHNOLOGIES
Del Global Technologies Corp. is primarily engaged in the design, manufacture
and marketing of high performance diagnostic imaging systems for medical, dental
and veterinary applications through the Del Medical Systems Group. Through its
U.S. based Del Medical Imaging Corp. and Milan, Italy based Villa Sistemi
Medicali S.p.A. subsidiaries the Company offers a broad portfolio of general
radiographic, radiographic/fluoroscopic, portable x-ray and digital radiographic
systems to the global marketplace. Through its RFI subsidiary, Del Global
manufactures proprietary high-voltage power conversion subsystems including
electronic filters, high voltage capacitors, pulse modulators, transformers and
reactors, and a variety of other products designed for industrial, medical,
military and other commercial applications. The company's web site is
WWW.DELGLOBAL.COM.
DEL GLOBAL TECHNOLOGIES CORP.: MEDIA RELATIONS:
James A. Risher M. Thomas Boon
Chief Executive Officer VP Global Sales and
Marketing (847) 288-7023
(847) 288-7065
Mark A. Zorko
Chief Financial Officer
(847) 288-7003
THE EQUITY GROUP INC.
Devin Sullivan
Senior Vice President
(212) 836-9608
