EXHIBIT 99.1
TEXT OF PRESS RELEASE DATED JULY 1, 2002
AUTODAQ AND AUTOTRADECENTER SIGN MERGER AGREEMENT
Combined Entity Becomes Most Comprehensive Source For Internet Vehicle
Remarketing Services
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MENLO PARK, CA and MESA, AZ - July 1, 2002 - Autodaq Corporation and
AutoTradeCenter.com Inc. (OTC BB: AUTC - news) announced today the signing of a
definitive merger agreement. The combined entity offers the automotive
remarketing industry the most comprehensive set of remarketing services for
manufacturers, leasing, rental and fleet companies as well as wholesalers and
automobile retailers.
The new AutoTradeCenter, Inc. will continue trading on the OTCBB under
the current symbol AUTC. Three members of AutoTradeCenter.com's current Board of
Directors will join the new entity's Board of Directors following the closing of
the merger. The senior management of both entities will remain with the combined
entity. Adam Boyden, president and chief executive officer of Autodaq, will be
the chief executive officer of the new entity, and Roger L. Butterwick,
president of AutoTradeCenter.com, will be the chief financial officer. The
merged entity will retain its administrative offices and technology group in
Menlo Park, the Internet dealer services operation center in Mesa and Coconut
Creek, Florida, and the remarketing management, lease maturity management and
sales and leadership-training center in Minneapolis.
"This is an important step that will accelerate our strategy and
position us as leaders in remarketing technology, operational expertise and
proven vehicle sales," said Boyden. "In addition to the clear strategic benefits
of combining two highly complementary organizations, we create substantial value
through significant cost structure improvements and access to new growth
opportunities. This combination puts us into a leadership role in our industry
segment."
Butterwick said, "We are creating a new kind of industry leader - one
founded on superior customer service, world-class technology and infrastructure,
and the industry's best performing products and services. With our combined
resources, we can deepen our commitment to excellence in automotive remarketing
services."
The new combined entity will be uniquely positioned to leverage its
expertise and experience operating successful remarketing programs for such
companies including Audi, Honda, Hyundai, Isuzu, Suzuki, Volvo, Enterprise
Rent-a-Car, and several other banks and financial institutions.
Under the terms of the agreement, AutoTradeCenter.com shareholders will
receive shares of Common Stock and Preferred Stock in a newly-formed Delaware
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company, AutoTradeCenter, Inc. Autodaq shareholders will receive shares of
Common Stock and various classes of Preferred Stock in AutoTradeCenter, Inc.
As a result of the foregoing transactions, following the merger the
current shareholders of AutoTradeCenter.com will own approximately 26.5% of the
new company's fully-diluted capital stock (including, for purposes of this
calculation, shares of Common Stock reserved for issuance pursuant to the
company's stock option plan), and the current shareholders of Autodaq will own
approximately 64% of the new company's capital stock. Senior management of
AutoTradeCenter.com will receive options to purchase up to an aggregate of 4.5%
of the new entity's Common Stock. Shares of Common Stock reserved for issuance
pursuant to the company's stock plan will constitute the remaining 5% of the
company's capital stock. The transaction will be accounted for as a purchase and
is intended to qualify as tax-free to the shareholders of AutoTradeCenter.com
and Autodaq. The transaction is expected to close in the second half of 2002.
The merger is subject to approval of the shareholders of AutoTradeCenter.com and
Autodaq, as well as other customary closing conditions. Autodaq shareholders
holding shares sufficient to approve the merger delivered voting agreements and
proxies in which they agreed to vote their shares in favor of the merger. The
agreement requires AutoTradeCenter.com to deliver voting agreements and proxies
from shareholders holding shares sufficient to approve the merger on or before
July 19, 2002. In the event AutoTradeCenter.com fails to deliver such voting
agreements as previously described, an affiliate of Autodaq may exercise a
warrant convertible into a majority of AutoTradeCenter.com's capital stock for
nominal consideration.
Additionally, as part of the agreement, Autodaq loaned
AutoTradeCenter.com approximately $1 million, which AutoTradeCenter.com used to
retire its indebtedness under a credit facility due on June 30, 2002 and to
terminate a services agreement related to such credit facility.
AutoTradeCenter.com is not required to make payments to Autodaq under the loan
prior to the closing of the merger. As partial consideration for such loan,
AutoTradeCenter.com provided an affiliate of Autodaq with a warrant to purchase
shares equal to approximately 5% of AutoTradeCenter.com's Common Stock on a
fully-diluted basis at an exercise price equal to the fair market value of
AutoTradeCenter.com's Common Stock.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
AutoTradeCenter.com intends to mail a proxy statement to its
shareholders in connection with the transaction. Investors and security holders
of AutoTradeCenter.com are urged to read the proxy statement when it becomes
available because it will contain important information about
AutoTradeCenter.com, Autodaq and the transaction. Investors and security holders
may obtain a free copy of the proxy statement (when it is available) at the
SEC's web site at WWW.SEC.GOV. A free copy of the proxy statement may also be
obtained from AutoTradeCenter.com. In addition to the proxy statement,
AutoTradeCenter.com files annual, quarterly and special reports and other
information with the SEC. Investors may read and copy any of these reports,
statements and other
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information at the SEC's public reference rooms located at 450 5th Street, N.W.,
Washington, D.C., 20549, or any of the SEC's other public reference rooms
located in New York and Chicago. Investors should call the SEC at
1-800-SEC-0330 for further information on these public reference rooms. The
reports, statements and other information filed by AutoTradeCenter.com with the
SEC are also available for free at the SEC's web site at WWW.SEC.GOV. A free
copy of these reports, statements and other information may also be obtained
from AutoTradeCenter.com.
FORWARD LOOKING STATEMENT
This news release contains forward-looking statements that involve
risks, uncertainties and assumptions. All statements other than statements of
historical fact are statements that could be deemed forward-looking statements.
For example, statements of expected synergies, timing of closing, industry
ranking, execution of integration plans and management and organizational
structure are all forward-looking statements. Risks, uncertainties and
assumptions include the possibility that the market for the sale of certain
products and services may not develop as expected; that development of these
products and services may not proceed as planned; that the transaction does not
close or that the companies may be required to modify aspects of the transaction
to achieve regulatory and other approval; that the conditions to the closing of
the merger described above do not occur; or that prior to the closing of the
proposed merger, the businesses of the companies suffer due to uncertainty; that
the parties are unable to transition customers, successfully execute their
integration strategies, or achieve planned synergies; other risks that are
described from time to time in AutoTradeCenter.com's Securities and Exchange
Commission reports. If any of these risks or uncertainties materializes or any
of these assumptions proves incorrect, AutoTradeCenter.com's and Autodaq's
results could differ materially from the expectations in these statements.
AutoTradeCenter.com and Autodaq assume no obligation and do not intend to update
these forward-looking statements.
PRESS CONTACTS:
Autodaq: Amy Hendrickson 952.736.8800 or e-mail: ahendrickson@autodaq.com
AutoTradeCenter.com: Lucy Seegan 480.556.6701 ext. 405 or e-mail:
lseegan@autotradecenter.com
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