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Del Global Technologies Corp.
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[LOGO] DEL GLOBAL TECHNOLOGIES CORP.
FOR IMMEDIATE RELEASE
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DEL GLOBAL TECHNOLOGIES APPOINTS NEW DIRECTORS
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Assures Independent Governance And Brings
Seasoned Business Leadership To Company
COMPANY ALSO COMMENTS ON PROXY CONTEST
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VALHALLA, NY, April 11, 2003 - Del Global Technologies Corp. (DGTC) ("Del")
today announced the retirement of long-serving directors James Tiernan and David
Michael, as well as the appointment of three new independent directors to its
Board.
Commenting on the changes, Del Global President and Chief Executive Officer
Samuel E. Park said, "Jim and David helped steer the Company through some very
difficult times in the last two years. We appreciate their leadership and
resilience during this recovery period. I wish them both well in the future."
The three new directors are Frank Brady, Glenda Burkhart and Steve Wertheimer.
"Frank, Glenda and Steve bring significant business credentials and seasoned
leadership to Del Global's governance structure; they are eminently qualified to
assure that shareholders' long-term interests are paramount in future strategic
decisions affecting the Company. Importantly, they represent a clean break from
Del's past; it is vital that an independent, capable and balanced Board of
Directors centrally focused on protecting and advancing long-term shareholder
interest be appointed. This represents another step change on our road to
recovery," Mr. Park added.
Frank Brady will assume the chair of the Board, Ms. Burkhart will chair the
Stock Option and Compensation Committee and Mr. Wertheimer will chair the Audit
Committee. Current independent director, Edgar J. Smith Jr., will chair the
Nominating and Governance Committee. Mr. Park is the fifth Board member. In
establishing this structure, the Company assures strict governance standards:
the position of the Chairman and the Chief Executive Officer are separate, four
of five directors are independent, and only independent directors will sit on
each Board committee. Del's Board of Directors increases to five members with
this change.
Frank J. Brady is a co-founder and pro bono chairman of the Board of Trustees
for Medical Missions for Children, an organization which uses telemedicine to
assist underprivileged and seriously ill children. Mr. Brady spent his corporate
career in the international market organizing projects and arranging financing
for international business consortiums among major European, Asian and American
companies. He also founded the School of Diplomacy and International Relations
at Seton Hall University in alliance with the United Nations.
Glenda K. Burkhart is a partner of Deltech Consulting Group, a management
consulting firm. Previously she was Vice President for Operations and Planning
for the Andrew W. Mellon Foundation and held executive management positions at
Readers' Digest Association, Millipore Corporation, Exxon Chemical and worked as
a consultant for Bain & Company.
Del Global Technologies Page 2
April 11, 2003
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Stephen N. Wertheimer is a Managing Director of W Capital Partners, a firm that
specializes in the acquisition and management of portfolios of private equity
investments acquired from corporations and institutions in the secondary market.
Previously he held executive management positions at Bank America, First
Chicago, PaineWebber and CRT Capital Group.
"Frank, Glenda and Steve are globally experienced executives who bring
significant business experience from large private and public companies to Del's
Board. As well as independence, they will bring strategic business and industry
insight, organizational acuity, and financial expertise to the Board. Ed and I
look forward to working with them as we assure Company strategies are aligned
with shareholder long-term interests," commented Mr. Park.
Existing independent director Ed Smith has been a member of Del Global's Board
since December 2002. He was Vice President, General Counsel and Secretary of
Witco Corporation from 1998 until his retirement in 1999. Previously Mr. Smith
had been Vice President, General Counsel and Secretary of General Signal
Corporation. Both were NYSE traded companies.
Sam Park joined Del in May 2001 following the discovery of serious financial
irregularities and the dismissal of the prior Chief Executive Officer and
Chairman. Before joining Del, he was President and Founder of the Hibernian
Consulting Group, which specialized in helping clients increase the value of
their companies; President-Americas, Process Equipment Division, of United
Utilities Ltd., serving the water and wastewater equipment markets worldwide;
and President of Leeds and Northrup (a unit of General Signal), an international
manufacturer of high technology electronic instrumentations, sensors and complex
large-scale process control systems. Prior to that, Mr. Park held various
executive positions with both General Electric Company and General Signal
Corporation.
PROXY CONTEST
The Company also commented on its pending proxy contest and announced that
discussions between the Company and a shareholder activist group had broken
down. The group, which owns approximately 12% of the Company and includes Steel
Partners II, L.P., an investment partnership controlled by Warren Lichtenstein,
and private investment partnerships managed by David Wright, have filed a
preliminary proxy statement designed to take over control of the Company's Board
at Del's annual meeting of shareholders scheduled for May 14, 2003.
The Company, which is led by an entirely new management team, tried to reach
agreement with the dissident group to prevent a costly and distracting proxy
battle. "Despite our best good faith efforts, it has become increasingly obvious
that this is simply a blatant attempt to take over the Company while paying no
premium at all to our shareholders," commented Mr. Park.
In the next several days, the Company will be filing its preliminary proxy
statement in preparation for the shareholder meeting. This proxy will nominate
its five-member Board of Directors for re-election and provide notice of other
shareholder matters to be voted on at the shareholder meeting.
Del Global Technologies Page 3
April 11, 2003
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"Over the last two years the new management team has restored the liquidity and
financial condition of the Company and made the Company financially stable. We
now expect the Company to return to profitability in the second half of Fiscal
2003, absent unforeseen expenses," Mr. Park said. "It is vital to assure that
our progress is not interrupted; it is equally important that the shareholders
appoint a seasoned, balanced and globally experienced independent Board of
Directors centrally focused on continuing our momentum and protecting and
advancing longterm shareholder interest," he added.
Since discovery of serious irregularities in late 2000, Del has appointed an
entirely new senior executive team, re-staffed much of its management structure,
and realigned its cost base by consolidating facilities and integrating
operations to restore the Company to profitability. The Company has improved its
liquidity position by arranging a $10 million credit facility, settled the
shareholder class action litigation against the Company, and reached an
agreement in principle with the SEC regarding its investigation into financial
statements filed by the previous management team. Despite the challenging
economic environment and the Company's difficult recent history, revenues grew
by 6% in the last fiscal year, and grew 7% for the six months ending January
2003, versus the prior year. For Fiscal 2002 cash flow from operations improved
from a negative $5.8 million to a positive $6.3 million, and for the first half
of Fiscal 2003 increased to $5.7 million, versus $4.3 million in the same period
of the prior year.
Del Global Technologies Corp. is primarily engaged in the design, manufacture
and marketing of cost-effective medical imaging and diagnostic systems
consisting of stationary and portable x-ray systems, radiographic/fluoroscopic
systems, dental imaging systems and proprietary high-voltage power conversion
subsystems for medical and other critical industrial applications. Industrial
applications for which Del supplies power subsystems include airport explosives
detection, analytical instrumentation, semiconductor capital equipment and
energy exploration.
Statements about future results made in this release may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements are based on current
expectations and the current economic environment. The Company cautions that
these statements are not guarantees of future performance. They involve a number
of risks and uncertainties that are difficult to predict including, but not
limited to, the ability of the Company to implement its business plan,
management changes, changing industry and competitive conditions, obtaining
anticipated operating efficiencies, securing necessary capital facilities,
favorable determinations in various legal and regulatory matters and favorable
general economic conditions. Actual results could differ materially from those
expressed or implied in the forward-looking statements. Important assumptions
and other important factors that could cause actual results to differ materially
from those in the forward-looking statements are specified in the Company's
filings with the Securities and Exchange Commission.
Del Global will file shortly with the Securities and Exchange Commission a
preliminary proxy statement relating to
the solicitation of proxies with respect to the Del Global 2003 annual meeting
of shareholders. Del Global will file
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April 11, 2003
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with the Commission, and will furnish to its shareholders, a definitive proxy
statement and may file other proxy solicitation materials. Investors and
security holders are urged to read the proxy statement and any other proxy
solicitation materials (when they become available) because they will contain
important information.
Del Global and the directors and certain of the executive officers of Del Global
may be deemed to be participants in the solicitation of proxies in respect of
electing the board of directors of Del Global at the 2003 annual meeting of
stockholders. Additional information with respect to the beneficial ownership of
those executive officers and directors of Del Global common stock is set forth
in the preliminary proxy statement to be filed by Del Global with the
Commission.
Investors and security holders may obtain a free copy of the preliminary proxy
statement and the definitive proxy statement (when it is available) and other
documents filed by Del Global with the Commission at the Commission's website at
http://www.sec.gov. You may also access a copy of Del Global's preliminary proxy
statement and definitive proxy statement (when it is available) by accessing
http://www.delglobaltech.com. In addition, you may obtain a free copy of the
definitive proxy statement (when it is available) by contacting Georgeson
Shareholder Communications Inc. toll free at (800) 545-1782 (banks and brokers
call collect at (212) 440-9800).
CONTACTS:
DEL GLOBAL TECHNOLOGIES CORP.
Samuel E. Park, President and Chief Executive Officer
Thomas V. Gilboy, Chief Financial Officer
(914) 686-3600
MEDIA
The Abernathy MacGregor Group, Inc.
Steve Frankel
(212) 371-5999
INVESTORS
Georgeson Shareholder Communications Inc.
(800) 545-1782