Daticon Reaches Agreement with Xiotech Corporation for the Purchase of Daticon's Assets. Daticon to Remain in Eastern Connecticut and to Retain its Current Employees.
Company Officials Expect the Deal to be Completed within 7 weeks and to Result in Daticon Becoming a Stronger, More Successful Company.
Norwich, Conn., January 17, 2006
Daticon, LLC, one of the leading providers of litigation support and document conversion services, announced that today it has reached an agreement with Xiotech Corporation, a leading storage technology company with headquarters in Eden Prairie, Minnesota, for Xiotech to purchase the assets of Daticon. As a part of this agreement, Daticon has filed a petition under Chapter 11 of the U.S. Bankruptcy Code with the U.S. Bankruptcy Court, District of Connecticut, seeking authority to sell its assets to Xiotech. This and several other strategic initiatives are geared towards helping Daticon become stronger, healthier, and ultimately a better company that is more competitive in its marketplace.
Xiotech has already executed an Asset Purchase Agreement with Daticon. While it is the intent of both parties to consummate the transaction within 7 weeks, the Agreement and the buyer are subject to approval of the Bankruptcy Court. Under the Agreement, Xiotech proposes to purchase virtually all of Daticon's assets and assume its employee expenses thereby retaining its current employee levels. Xiotech's Chief Executive Officer, Casey Powell, a native of Groton, Connecticut, is looking forward to expanding Xiotech's presence into Eastern Connecticut.
Daticon's sale and restructuring is designed to ensure the company's long-term financial health while it continues to operate in the normal course of business. The sale will permit the company to focus on the steps it must take to further its operational goals, while providing an opportunity to re-evaluate the current capital and cost structures.
"This is an important step for Daticon, and is part of a process that will result in a stronger company," said Bill Zambarano, President of Daticon. "Our goals are simple: to reduce Daticon's debt burden, maintain employee levels, and to give the company the financial infusion needed to
invest in its business and grow. I am confident in the future of Daticon and we appreciate the continued support of our customers, dedicated employees and business partners."
Daticon's highest priority is maintaining its commitments to its customers, employees, and community as it completes the sale process, which is anticipated to take no more than 60 days.
As a leading technology company with over 170 employees located in Eastern Connecticut, Daticon's restructuring will provide the company with the long-term financial stability that will preserve the vitality and high level of service that continues to be the hallmark of the company's reputation. The company's decision to restructure its financial underpinnings, while hard, is necessary to secure a positive environment for their employees while reassuring quality for customers.
Zambarano commented "There are many examples of companies successfully restructuring themselves while maintaining high quality deliverables and continuing their position as industry leaders. Daticon can, and will, accomplish these goals and join the fraternity of companies that emerge from restructuring stronger and extremely confident in the future. This is an exciting yet challenging time for Daticon, but the company knows that our restructuring will enable us to continue to maintain our market position as a world-class litigation support vendor to law firms and corporate legal departments."
Recently, Daticon announced that it was named one of the top 5 electronic discovery service providers for the second consecutive year in the recent Socha-Gelbmann 2005 Electronic Discovery Survey. Companies making this list are selected based on their performance in 2004, taking into account their experience, capacity, service offerings, as well as their overall customer ratings and revenue. Daticon was also recently recognized for the sixth straight year by being named to Deloitte & Touche's prestigious Technology Fast 50 Program for Connecticut. This prestigious ranking by Deloitte & Touche LLP, one of the nation's leading professional services firms recognizes Daticon as one of Connecticut's 50 fastest growing technology companies. Rankings are based on the percentage of growth in fiscal year revenues.
Zambarano added "Over the past few years, Daticon has achieved national recognition as one of the leading providers of electronic data and paper discovery services to law firms and corporate legal departments. As a technology-leading company headquartered in Norwich, CT., we are thankful for our strong relationship with the entire community, and we take pride in all of our valued employees - who are the driving force behind Daticon's continued success. We are proud to call Eastern Connecticut home and we look forward to a long-lasting partnership with the community in years to come."
About Daticon
Since 1993, Daticon has provided document review and management services for law firms, corporations, and government agencies involved in complex litigations, mergers, or compliance matters. Daticon's full-service offerings include Dativision, which encompasses a comprehensive set of Electronic Data Discovery (EDD) services including strategy, forensics, data collection, search and cull, conversion, review, and production; Daticon's Hosted Document Review offerings and all of the services needed to manage paper documents. The company's innovative services and flexible technology solutions meet the specialized needs of professionals throughout the industry including six of the Fortune 10 companies, more than half of America's leading litigation firms, and many state and federal agencies. Daticon is headquartered in Norwich, CT, with sales offices in Norwich, New York, and Washington, D.C.
