NEW YORK, Oct. 18, 2010 (GLOBE NEWSWIRE) -- Mr. Ephraim Fields of Echo Lake Capital today announced he had sent a letter to the Board of Directors of Tix Corp. (Nasdaq:TIXC). In the letter, Mr. Fields expressed his belief that the plan to delist and deregister the company's stock was not in the best interest of shareholders and had resulted in the further destruction of shareholder value. Mr. Fields also noted that the board was attempting to enact the Proposal without the approval of the company's shareholders. As a result, Mr. Fields called on TIXC's board to publicly release all the materials, analyses, reports, studies, etc. used by the board in evaluating whether the Proposal would benefit shareholders.
The full text of the letter follows:
October 17, 2010
Tix Corp.
12711 Ventura Boulevard
Suite 340
Studio City, CA 91604
To The Board of Directors of Tix Corp.:
In the press release announcing the plan to delist and deregister the stock of Tix Corp. (the "Proposal"), you claimed the Proposal "will benefit…stockholders, and ultimately will serve to maximize the value of the company." As our previous letter illustrated, the Proposal actually had the opposite effect because TIXC's stock price declined by as much as 37% as investors showed their displeasure with the Proposal by aggressively selling their shares. Clearly the investment community does not believe the Proposal is a good idea and is worried about the Proposal's significant, long-term ramifications. Furthermore, we note that you are attempting to enact the Proposal without obtaining shareholders' approval, a decision we believe is morally questionable.
Since the publication of our letter last week suggesting, among other things, that you cancel the Proposal, TIXC's stock price has increased 37%. This reinforces our belief that any reasonable person (not to mention any financially sophisticated investor) would recognize that the Proposal is not in the best interest of TIXC's shareholders.
Some investors believe you support the Proposal because you lack sufficient capital markets and public company experience. Other investors believe the Proposal is part of a scheme by company insiders to intentionally depress TIXC's stock price so they can eventually take the company private at a price lower than they would have needed to pay had the stock remained listed and registered.
Our concerns about the Proposal are based largely on our experience having observed the negative impact similar transactions have had on the stock prices and trading volume of other companies. However, we are reasonable people and only want what is best for shareholders. Therefore, if there is compelling evidence proving the Proposal will benefit shareholders, we (and other shareholders) would love to see it. As a result, we hereby call on you to publicly release all the materials, analyses, reports, studies, etc. you used to evaluate whether the Proposal would benefit shareholders. Presumably this information (i) includes precedents and other publicly available information, and (ii) does not include any projections or other confidential or material non-public information. As a result, we see no legal reason why you can not provide such information so that shareholders can better assess the merits of the Proposal. In fact, considering how much shareholder value has been destroyed under your watch and the lack of confidence investors have in you, we believe it behooves you to prove why the Proposal is so good for shareholders.
Unlike some of you, we own a significant amount of TIXC stock, so we are highly incentivized to ensure that shareholder value is created. Unlike all of you, we do not receive any cash compensation from the company, so we have no possible motivation to advocate something that would not be in the best interest of TIXC's shareholders.
You should be embarrassed by your poor record of creating shareholder value. We hope you will soon finally start acting in the best interest of TIXC's shareholders.
Sincerely,
Ephraim Fields
CONTACT: Echo Lake Capital Ephraim Fields 917-620-8421 ef@echolakecapital.com