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Viisage and Identix to Merge to Create Biometric Identity
Solution Leader
BILLERICA, Mass. & MINNETONKA, Minn--Jan. 12, 2006--Viisage Technology, Inc.
(Nasdaq: VISGD ) and Identix Incorporated (Nasdaq: IDNX ):
Establishes the Industry's Most Comprehensive Multi-Modal Biometric Platform
for Securing and Protecting Personal Identities
Management Team to be Led by Robert V. LaPenta as Chairman and Chief
Executive Officer
Combined Pro Forma Calendar 2006 Estimated Revenue of $220 Million and
EBITDA of at Least $40 Million
Identity solutions provider Viisage Technology, Inc. (Nasdaq: VISGD ) and
biometric technology innovator Identix Incorporated (Nasdaq: IDNX ) today
announced they have entered into a definitive agreement to merge in an all
stock transaction. The combined company will blend two complementary
approaches to solving the challenge of protecting and securing personal
identities by establishing the industry's most comprehensive single platform
for multi-modal finger, face, skin and imaging identity solutions. The
combination has been approved by the respective boards of directors of each
company.
The combined company, on a pro forma calendar 2006 basis, is expected to
have revenue of approximately $220 million and EBITDA of at least $40
million, including synergies and operating efficiencies.
Under the terms of the transaction, Identix shareholders will receive a
fixed exchange ratio of 0.473 newly issued shares of Viisage stock for each
share of Identix stock. The transaction is expected to be tax-free to
shareholders of both companies for U.S. federal income tax purposes. Based
on Viisage's closing stock price of $17.69 on January 11, 2006, the
transaction is valued at approximately $770 million on a fully diluted
basis.
Upon completion of the transaction, current Identix shareholders will own
approximately 59 percent of the combined company and current Viisage
shareholders will own approximately 41 percent of the combined company. The
combined company's board of directors will consist of 12 directors, with
seven of the members designated by Viisage and affiliates and five
designated by Identix. The headquarters of the combined company will be in
Stamford, Connecticut. In addition, certain affiliates of both Viisage and
Identix have agreed to vote their shares in favor of the merger.
Following the close of the transaction, the company expects to evaluate
alternatives for repurchasing outstanding shares, including the potential
issuance of convertible debt.
"The combination of Identix' advanced multi-biometric search technology with
Viisage's expertise in secure credentials, document authentication and
verification will create a global leader in biometric security, providing
end-to-end identity solutions for state, local, national and foreign
government use, as well as a wide application across the commercial sector,"
said Robert V. LaPenta, Chairman of the Board of Viisage. "With its proven
technology, strength of management and services, and marquee customer base,
the combined entity has the ability to achieve significant revenue growth
and profitability."
Upon completion of the merger, Mr. LaPenta, Viisage's Chairman, will become
Chairman and Chief Executive Officer of the combined company. Mr. LaPenta is
the Chairman, CEO and founder of L-1 Investment Partners, Chairman of the
Board of Viisage, and former President, Chief Financial Officer and
co-founder of L-3 Communications. Dr. Joseph J. Atick, currently Chief
Executive Officer of Identix, will become Vice Chairman of the combined
company's Board of Directors and Chief Strategic Officer.
"This is a fantastic opportunity for the new company's shareholders,
employees and customers and will create a formidable combination in the
identity solution / management and biometrics sector," said Dr. Joseph J.
Atick, CEO of Identix.
Unlocking the Potential of Strong Synergies
Driven by a combined global sales force, the merger unlocks the potential of
both organization's strengths in biometrics, credentialing and imaging
solutions and offers many natural synergies. For example, Viisage and
Identix each have current customer relationships today with the Department
of State, with Identix providing biometric facial recognition products for
the U.S. VISA program and Viisage acting as the sole source provider for
U.S. passports.
The combined technologies are uniquely suited to support multiple identity
programs including visa and passport issuance, border control and security,
voting program integrity, secure logical access for enterprise and
government, and the myriad of government-related access card requirements.
In addition, the new company also can successfully meet rigorous government
mandates including HSPD12, TWIC, WHTI, US- VISIT, Registered Traveler,
HAZMAT, Real ID and ePassport, among others.
The merger positions the new company as a market leader in the biometrics
sector. The combined capabilities allow the new company to effectively
compete for approximately 80 percent of a market opportunity projected by
Frost & Sullivan to reach $3.5 billion by 2008*.
The transaction is expected to close in the second calendar quarter of 2006
and is subject to customary regulatory approvals and other closing
conditions, including approval by Viisage and Identix shareholders at their
respective stockholder meetings.
Bear, Stearns & Co. Inc. is serving as financial advisor to Viisage, while
USBX Advisory Services LLC provided a fairness opinion to the Viisage Board.
Janney Montgomery Scott LLC is serving as financial advisor to Identix and
has provided a fairness opinion to the Identix Board.
Conference Call Today
The management of Viisage, Identix, and L-1 will host a conference call with
the investment community to discuss this merger beginning at 9:00 a.m. ET on
Thursday, January 12, 2006. The dial-in number for the call is 866-713-8566,
confirmation code 12298018. Internationally, please dial 617-597-5325, using
the same confirmation code. To access a live webcast, please go to the
Investor Relations section at www.Viisage.com at least 10 minutes prior to
the start of the call and follow the directions. A replay of the webcast
will be available at both company's Web site beginning one hour after
completion of the call. There also will be a corresponding Powerpoint
presentation available.
About Viisage Technology, Inc.
Viisage (NASDAQ: VISGD - News) delivers advanced technology identity
solutions for governments, law enforcement agencies and businesses concerned
with enhancing security, reducing identity theft, and protecting personal
privacy. Viisage solutions include secure credentials such as passports and
drivers' licenses, biometric technologies for uniquely linking individuals
to those credentials, and credential authentication technologies to ensure
the documents are valid before individuals are allowed to cross borders,
gain access to finances, or granted other privileges. With over 3,000
installations worldwide, Viisage's identity solutions stand out as a result
of the Company's industry-leading technology and unique understanding of
customer needs. Viisage's product suite includes FaceTOOLS® SDK, Viisage
PROOF(TM), FaceEXPLORER®, iA-thenticate®, BorderGuard®, FacePASS(TM) and
FaceFINDER®.
About Identix Incorporated
Identix Incorporated (Nasdaq:IDNX - News) is the world's leading
multi-biometric technology company. Identix provides fingerprint, facial and
skin biometric technologies, as well as systems, and critical system
components that empower the identification of individuals in large-scale ID
and ID management programs. The Company's offerings include live scan
systems and services for biometric data capture, mobile systems for
on-the-spot ID, and backend standards-based modules and software components
for biometric matching and data mining. Identix products are used to conduct
background checks, speed travel and commerce via secure identification
documents, prevent identity fraud in large-scale government and civil ID
programs, and control access to secure areas and networks. With a global
network of partners, such as leading system integrators, defense prime
contractors and OEMs, Identix serves a broad range of markets including
government, law enforcement, gaming, finance, travel, transportation,
corporate enterprise and healthcare. More information on Identix can be
accessed via the Company web site at http://www.Identix.com.
About L-1 Investment Partners
L-1 Investment Partners LLC was founded in June 2005 by Robert V. LaPenta,
former President, Chief Financial Officer and co-founder of L-3
Communications. L-1 invests in public and private entities in the biometric
technologies and security solutions sector and provides both growth capital
and management expertise to assist its portfolio companies in building their
businesses.
Forward-Looking Statements
The statements contained in this release, which are not historical facts,
are forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. These statements are based on Viisage's and Identix' current
expectations and beliefs and are subject to a number of risks and
assumptions that could cause actual results to differ materially from those
described in the forward-looking statements. All statements other than
statements of historical fact are statements that could be deemed
forward-looking statements. Examples of such forward looking statements
include Identix' belief that the merger will be completed, Viisage is an
excellent fit with Identix, the merger of Identix and Viisage will
strengthen the combined company's activities, and that the merger will add a
base of new customers and expand the scope of the combined company's
products. These statements are subject to uncertainties that could cause
actual results to differ materially from those set forth in or implied by
forward-looking statements. These risks and uncertainties include, among
others, the following risks: that the merger will not close, that the
regulatory or shareholders approval will not be obtained, that the closing
will be delayed, that customers and partners will not react favorably to the
merger, integration risks, the risk that the combined companies may be
unable to achieve cost-cutting synergies, and other risks described in
Identix' and Viisage's Securities and Exchange Commission filings, including
the Registration Statement on Form S-4 to be filed with the SEC in
connection with the transaction, Identix' Annual Report on Form 10-K for the
year ended June 30, 2005 and its Quarterly Report on Form 10-Q for the
quarter ended September 30, 2005 under the captions "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," and Viisage's Annual Report on Form 10-K for the year ended
December 31, 2004 and its Quarterly Reports on Form 10-Q for the quarters
ended April 3, 2005, July 3, 2005 and October 2, 2005 under the captions
"Risk Factors" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations." Neither Identix nor Viisage undertake
any obligation to update these forward-looking statements to reflect events
or circumstances after the date of this press release.
EBITDA
Viisage uses EBITDA as a non-GAAP financial performance measurement. EBITDA
is calculated by adding back to net income (loss) interest, taxes,
depreciation and amortization. EBITDA is provided to investors to complement
results provided in accordance with GAAP, as management believes the
measures help illustrate underlying operating trends in the Company's
business and uses the measures to establish internal budgets and goals,
manage the business, and evaluate performance. EBITDA should not be
considered in isolation or as a substitute for comparable measures
calculated and presented in accordance with GAAP.
Additional Information and Where to Find It
Investors and security holders of both Identix and Viisage are advised to
read the joint proxy statement/prospectus regarding the business combination
transaction referred to in the material below, when it becomes available,
because it will contain important information. Identix and Viisage expect to
mail a joint proxy statement/prospectus about the transaction to their
respective stockholders. This joint proxy statement/prospectus will be filed
with the Securities and Exchange Commission by both companies. Investors and
security holders may obtain a free copy of the joint proxy
statement/prospectus and other documents filed by the companies at the
Securities and Exchange Commission's web site at
http://www.sec.gov. The joint proxy
statement/prospectus and such other documents may also be obtained from
Identix or Viisage by directing such requests to the companies.
Participants In Solicitation
Viisage, Identix and their respective directors and executive officers
and other members of management and employees may be deemed to be
participants in the solicitation of proxies in respect of the merger.
Information concerning Viisage's participants is set forth in the proxy
statement dated, November 21, 2005, for Viisage's special meeting of
shareholders held on December 16, 2005 as filed with the SEC on Schedule
14A. Information concerning Identix' participants is set forth in the proxy
statement, dated October 6, 2005, for Identix' 2005 annual meeting of
shareholders as filed with the SEC on Schedule 14A. Additional information
regarding the interests of participants of Viisage and Identix in the
solicitation of proxies in respect of the merger will be included in the
registration statement and joint proxy statement/prospectus to be filed with
the SEC.
*Frost and Sullivan, North American Biometrics Markets - Investment Analysis
and Growth Opportunities, F637-F1
Contact:
Viisage
Chad Crouch, 703-414-5474
ccrouch@Viisage.com
or
Identix
Damon Wright, 952-979-8485
damon.wright@Identix.com
or
L-1 Investment Partners
Doni Fordyce, 203-504-1109
dfordyce@L-1ip.com
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