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Monday, Oct 7
Digital Generation reaches deal with activist investor
- Under the terms of the deal, Alex Meruelo, who has been waging a proxy war against Digital Generation's (DGIT) board, will support DGIT's board nominations during any election taking place prior to the closing of the sale of the company's TV ad unit to Extreme Reach (set to happen in Q1 2014).
- However, just prior to the merger, DGIT will be creating an online ad subsidiary with newly-issued shares (existing shareholders get them on a pro rata basis) and a 7-member board. Meruelo will have the right of appoint one of the board's directors, and to propose at least three individuals as candidates for one of the remaining board seats (DGIT will nominate two additional candidates for the seat).
- Meruelo promises not to lower his stake in the online ad subsidiary below 8.5%, and not to initiate a proxy war to take control of the unit until at least Q1 2015.