PRINCETON, N.J., March 9, 2017 /PRNewswire/ -- Dataram
Corporation (NASDAQ: DRAM) has announced a Special Meeting of
Shareholders to be held at the offices of Sichenzia Ross Ference
Kesner LLP at 61 Broadway 32nd floor NY, NY 10006 on
March 30, 2017 at 10:00 a.m. EDT. The notice of Special Meeting and
proxy statement/prospectus and a Letter to the Shareholders from
Dataram's Chairman and CEO, Dave
Moylan, can be found on the Company's website at
http://corporate.dataram.com/company-info/investor-relations/financial-releases-and-info.
Shareholders may also obtain this information without charge
through the Securities and Exchange Commission ("SEC") website
(www.sec.gov) or upon your written or oral request by contacting
the Chief Executive Officer of Dataram Corporation, 777 Alexander
Road, Suite 100, Princeton, New
Jersey 08540 or by calling (609) 799-0071.
Our shareholder letter follows in its entirety.
Dear Fellow Dataram Shareholders:
As I have done periodically, I would like to take this
opportunity to provide you with an update on the business and
direction of our Company, and in doing so, also ask for your
support.
A little over two years ago, we re-focused Dataram to
concentrate on what it does best, and has done extremely well,
since incorporating in 1967 — delivering customized memory
solutions into complex technical environments for our business
customers around the globe. Throughout this period, our customers
have continuously reaffirmed that Dataram's efforts to deliver
solutions that provide the lowest cost of ownership in a consistent
and service-oriented manner are what they value most.
As we refocused, we embarked on a journey to aggressively
streamline operations to establish the foundation for global growth
and afford us optimum strategic flexibility, while maximizing
shareholder value. On our journey, we made many difficult, but
necessary decisions to ensure the Company remained viable and
relevant. We reset the business strategy, improved Corporate
Governance to provide transparency and accountability at all
levels, transformed our go-to-market efforts and established
powerful market touch points, focused on and improved talent
management, and improved financial performance, while significantly
reducing operational costs to deliver quantifiable bottom line
improvements, establish a leaner, more flexible workforce,
facilitate partnerships, and support M&A efforts.
Of all these efforts, improving financial performance has proven
most challenging. The business environment for enterprise memory
solutions has remained as volatile and competitive as it has ever
been, and Dataram continues to operate in a market driven by
technical product standardization, supplier and manufacturer
consolidation, and continuous technology advancements.
While our size is an advantage, affording us an entrepreneurial
nimbleness to address challenges the larger players may not
possess, we remain constrained in that while we can quickly respond
to changes, we do not have the deep pockets many of our much larger
competitors have. We are also subject to extreme price fluctuations
in our raw materials, which ranged from significant decreases in
2015 to steep increases in 2016. To address this challenge,
business diversification and growth through acquisition have become
increasingly attractive and viable strategic options and we have
focused on and evaluated several potential acquisitions to help us
grow and diversify business risks across sectors.
Diversification and Growth Through Acquisition
In May 2016, we identified U.S.
Gold Corp., a U.S. based exploration company, as an acquisition
candidate, intended to accelerate our existing strategy of growth
and diversification. In evaluating the acquisition, we considered
Dataram's financial situation combined with the market for our
products and services and projected organic growth, and determined
that the entry into the natural resources segment represented a
market opportunity that would diversify the Company's business
model and thereby potentially mitigate risk associated with
focusing on one industry. It would also potentially increase the
overall value of the Company given U.S. Gold's two specific
projects – Copper King and Keystone - and the promising industry
analysis regarding the value of gold.
The Copper King property located in southwest Wyoming has a Net Present Value (NPV) of
$160 million based on measured,
indicated, and inferred resources of 1.1 million oz. of gold and
285 million lbs. of copper as presented in a Preliminary Economic
Assessment (PEA) by Mine Development Associates (MDA). The Keystone
Project, located in North Central Nevada, on the Cortez Trend,
consists of 377 unpatented lode mining claims representing
approximately 7,500 acres or 11-12 square miles. In mining terms,
Keystone represents a large, district scale opportunity.
While the memory business and junior mining business have
different business models and risk profiles, and also operate in
different markets (suppliers, customers), the combination of the
two businesses potentially mitigates sector specific exposure and
associated risks. Furthermore, the potentially strengthened balance
sheet of the combined organization resulting from U.S. Gold having
more than $9M in net assets provides
the combined entity a strong financial footing from which to
grow.
Upon closing of the transaction, Dataram will operate as a
single entity with two reporting businesses – a junior mining
business and a computer memory business. While each of these
businesses will be operated and managed independent of one another,
they will share common resources and functions to include, without
limitation: human resources, legal, facilities, back office
operations and administrative support. The sharing of common
functions and resources will be of mutual operational and financial
benefit. While each business will report as separate business into
the parent entity (Dataram), the combined organization will be led
by an experienced senior management team with representation from
each of the current management teams of Dataram and U.S. Gold, and
the Board of Directors will also have representation from each of
the current Boards of Directors of Dataram and U.S. Gold.
Dataram's Board will also declare a special dividend for the
shareholders of record as of no less than five (5) business days
prior to closing. This means the Company shareholders of this
record date will receive a special dividend from the net proceeds
should the Board elect to divest the memory business within
eighteen (18) months of the Closing Date of the U.S. Gold
acquisition. While there is no current plan to divest, should this
become a future consideration, the intent is to ensure the benefit
is received by, and only by, the pre-close shareholders.
Both Dataram's management and Board believe this acquisition
represents a tremendous diversification opportunity that is
economically viable and energizing, given the overall landscape and
market opportunity within natural resources, and that the
combination of the companies will generate significant value for
our shareholders.
The Proxy – We Are Asking for Your Support on Three
Items
In this proxy, there are three items we are asking you for your
support for and approval of. They are:
- Approval of the merger and the issuance of the merger
consideration;
- Approval of the certificate of amendment to Dataram's Articles
of Incorporation to increase its authorized Common Stock and
Preferred Stock; and
- Granting Dataram's Board the authority to implement a reverse
split of its common stock within a range of 1 for 2 and 1 for
10.
ROTH Capital Partners LLC, a full service investment banking
firm, was retained by Dataram. They reviewed the terms of the
acquisition and deemed the terms as fair. The amendment to increase
our capital stock gives Dataram the ability to complete the
transaction and ensure we have sufficient stock available to issue
the merger consideration and further support the Company's pursuit
of future growth opportunities. Important to note is that the
increase in capital stock is, in and of itself, not dilutive. The
approval of a reverse split is necessary to ensure the Company
meets the listing requirements after closing of the transaction and
maintains compliance with listing requirements of the NASDAQ Stock
Market LLC.
In Closing
Between May 2008 and April 2015, Dataram lost an average of
$4.7 million per year. This was a
bleak period in the Company's otherwise respectable history. In
January 2015, we took immediate,
decisive, and aggressive actions to significantly improve business
performance. We established a strong foundation from which to grow,
while simultaneously reigniting the entrepreneurial spirit upon
which the Company was founded nearly 50 years ago.
As we have transformed, we have looked at numerous opportunities
to diversify our business, grow the Company, and increase the value
delivered to shareholders. Dataram's proposed acquisition of U.S.
Gold is intended to accomplish our diversification and growth
objectives while also improving the value delivered to you, our
shareholders.
In 2015, I said it was "darkest before the dawn, and the dawn
has started to break. We believe our best days are ahead of us."
Our best days have arrived and with your approval, begin today.
Thank you for your continued support.
~ Dave
David A.
Moylan
Chairman and Chief Executive Officer
About Dataram Corporation
Dataram is an independent manufacturer of memory products and
provider of performance solutions that increase the performance and
extend the useful life of servers, workstations, desktops and
laptops sold by leading manufacturers such as Dell, Cisco, Fujitsu,
HP, IBM, Lenovo and Oracle. Dataram's memory products and solutions
are sold worldwide to OEMs, distributors, value-added resellers and
end users. Additionally, Dataram manufactures and markets a line of
Intel Approved memory products for sale to manufacturers and
assemblers of embedded and original equipment. 70 Fortune 100
companies are powered by Dataram. Founded in 1967, the Company is a
US based manufacturer, with presence in the United States, Europe and Asia. For more information about Dataram,
visit www.dataram.com.
Safe Harbor
Matters discussed herein contain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. When used in this press release, the words "anticipate,"
"believe," "estimate," "may," "intend," "expect" and similar
expressions identify such forward-looking statements. Actual
results, performance or achievements could differ materially from
those contemplated, expressed or implied by the forward-looking
statements contained herein. These forward-looking statements are
based largely on the expectations of the Company and are subject to
a number of risks and uncertainties. These risks include, but are
not limited to, risks and uncertainties associated with the price
of the Company's common stock and its ability to satisfy the
continued listing standards of The NASDAQ Stock Market, the impact
of economic, competitive and other factors affecting the Company
and its operations, markets, products, changes in the price of
memory chips, changes in the demand for memory systems, increased
competition in the memory systems industry, order cancellations,
delays in developing and commercializing new products, the
successful acquisition of U.S. Gold Corp., risks related to U.S.
Gold Corp., faced by junior exploration companies generally engaged
in pre-production activities; maintenance of important business
relationships; and other factors described in the Company's most
recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q
and Current Reports on Form 8-K, including the Risk Factors with
respect to U.S. Gold contained in the Current Report on Form 8-K
filed on November 29, 2016, with the
Securities and Exchange Commission, which can be reviewed at
www.sec.gov. The Company has based these forward-looking
statements on its current expectations and assumptions about future
events. While management considers these expectations and
assumptions to be reasonable, they are inherently subject to
significant business, economic, competitive, regulatory, and other
risks, contingencies, and uncertainties, most of which are
difficult to predict and many of which are beyond the Company's
control. The Company does not assume any obligations to update any
of these forward-looking statements.
For additional information, please contact:
Dataram Contact:
Jeffrey Goldenbaum
Director, Marketing
609-799-0071
info@dataram.com
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/dataram-announces-special-meeting-of-shareholders-and-shareholder-letter-300421442.html
SOURCE Dataram Corporation