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Tender Offer Commenced For Innotrac Stock Pursuant To Previously Announced Merger Agreement

Stocks in this article: INOC

ATLANTA, Dec. 5, 2013 /PRNewswire/ -- Innotrac Corporation (NASDAQ: INOC) ("Innotrac"), Blue Eagle Holdings, L.P. ("Parent"), and Blue Eagle Acquisition Sub, Inc., a wholly-owned subsidiary of Parent ("Purchaser"), today announced that, on December 4, 2013, Purchaser commenced the previously-announced cash tender offer for all of the outstanding shares of common stock of Innotrac at a price per share of $8.20, net to the seller in cash, without interest and less any applicable withholding tax.  Parent and Purchaser are affiliates of private equity firm Sterling Partners.

On November 14, 2013, Innotrac announced that it had entered into a definitive merger agreement pursuant to which the tender offer would be made. Pursuant to the merger agreement, after completion of the tender offer and the satisfaction or waiver of the conditions to the tender offer, Purchaser will merge with and into Innotrac, and all of the then outstanding shares of Innotrac's common stock (other than shares held by Innotrac, Parent, their respective wholly owned subsidiaries, or Innotrac's shareholders that validly exercise dissenters' rights under Georgia law with respect to such shares) will be automatically converted into the right to receive cash equal to the $8.20 offer price per share, without interest and less any applicable withholding tax.

As previously announced, Scott D. Dorfman, Innotrac's founder, Chairman, Chief Executive and largest shareholder, has entered into a contribution and support agreement pursuant to which he and related shareholders have agreed not to tender any of their shares in the tender offer and, following the completion of the tender offer, will contribute all of their shares, representing approximately 44% of Innotrac's outstanding common stock, to Parent in exchange for Parent equity interests.  Upon the closing of the transaction, Mr. Dorfman and the related shareholders will be paid at the offer price for Parent equity interests that correspond to approximately 70% of their Innotrac holdings, and will then beneficially own approximately 19.5% of the fully-diluted equity interests of Parent.  Mr. Dorfman and the Innotrac management team will continue their leadership of the Company after the transaction is closed.

Upon the unanimous recommendation of a special committee of the board of directors of Innotrac comprised solely of independent directors, Innotrac's board of directors unanimously (other than Mr. Dorfman, who abstained) approved the merger agreement and the transactions contemplated thereby, including the tender offer. The board of directors of Innotrac has recommended that Innotrac's shareholders tender their shares in the tender offer.

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