This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Group Led By Former Chairman And CEO Kaleil Isaza Tuzman Extends Revised Acquisition Offer To KIT Digital Board Of Directors

More importantly, we are aware of numerous strategic and financial parties interested in the Company that have been ignored, rebuffed and stonewalled in recent months and weeks by the Company and its financial advisors, or have been paralyzed for months by standstill provisions included in the form confidentiality agreement propagated by the Company as a requisite for entering into any acquisition dialogue.



If any of the foregoing conclusions are based on incorrect information, please openly correct our understanding.  

We fear that KITD's current structural, commercial and liquidity challenges will worsen and compound—leaving the Company and its shareholders with limited, if any, options to preserve or generate value for shareholders. As such, we urge you to take immediate action to the benefit of shareholders and:

  • Execute on the operational turnaround plan articulated in our Initial Letter;
  • Clearly explain your balance sheet fortification strategy to KITD shareholders, specifically how you intend to avoid a foreclosure by WTI or a similar action taken by a replacement, "last resort" lender;
  • Conduct an open and transparent auction of the business (without discriminating against any prospective bidders) with a reasonable minimum bid price; and
  • Release any party that is currently subject to a standstill provision from any restrictions on participating within or pursuing a transaction to acquire the Company.

With respect to our provisional buy-out offer from the Initial Letter, neither you nor your advisors have engaged with us directly. However, several days after you received our Initial Letter, we were contacted by an executive of JEC Capital (the New York hedge fund that currently controls the Company and for which current KITD CEO Peter Heiland serves as Managing Director), who stated that you were not taking our offer seriously because you were unsure of our financial backing, and encouraged us to submit an offer to the board of KITD using a "customary offer letter format".  While we believe this is a delaying tactic—since we used a standard, conditional offer structure and you are aware of at least one of our large private equity partners—we have nevertheless complied with this request. Earlier today, December 5, 2012, we separately submitted a revised, non-binding offer letter in a customary format to the Company's board of directors, as well as a draft confidentiality agreement that we would be prepared to sign in order to pursue a potential transaction. As part of this documentation, we said we would expect to be able to reach a definitive and binding acquisition agreement within thirty (30) days of being granted due diligence access.

Given the current price of KITD stock, compounded by the Company's strategic drift and worsening liquidity and capital structure issues, we have lowered our indicative offer to acquire the Company to a range of $1.35 -$1.70 per share—representing, at the midpoint of the range, a 112% premium to the $0.72 closing price of the Company's shares on Tuesday, December 4, 2012. Our offer is subject to due diligence, your release of certain parties from standstill agreements, and a mutually acceptable definitive agreement.



2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

DOW 18,232.02 -53.72 -0.29%
S&P 500 2,126.06 -4.76 -0.22%
NASDAQ 5,089.3620 -1.4320 -0.03%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs