DALLAS–(BUSINESS WIRE<\/a>)– \nThe suit is in response to Daktronics\u2019 recently called Special Meeting of Shareholders (the \u201cSpecial Meeting\u201d) to reincorporate from South Dakota to Delaware (the \u201cReincorporation Proposal”). Alta Fox has also filed a preliminary proxy statement (reviewable here<\/a>) to solicit shareholder votes AGAINST<\/span><\/b> the Reincorporation Proposal. Tellingly, the Company\u2019s preliminary proxy statement reveals that the principal reason for reincorporation is to eliminate cumulative voting, a statutory right for all shareholders of companies incorporated in South Dakota. The Reincorporation Proposal appears to be in response to Alta Fox\u2019s publicly disclosed plan to nominate highly qualified candidates for election to the Board of Directors (the \u201cBoard\u201d).1<\/sup> In our view, the Board\u2019s objective is to use a change in the Company\u2019s jurisdiction to eliminate shareholders\u2019 long-standing rights under South Dakota law and prevent the Board from being held to account.<\/p>\n \nAlta Fox believes the timing of the Reincorporation Proposal reveals that the Board\u2019s intent is to weaken shareholder rights, as evidenced by the following facts:<\/p>\n \nIn its misguided attempts to defend itself, the Board chose to mislead investors about the value of Alta Fox’s convertible securities and publicly smear its largest shareholder \u2013 the very benefactor that provided critical financing in the Company\u2019s time of need.5<\/sup> Based on feedback and public statements from other shareholders, it is clear that there are widely held concerns regarding the Company\u2019s long-term underperformance, capital allocation blunders and history of shareholder-unfriendly governance.6<\/sup> As we have said previously, we are supportive of actions that actually enhance Daktronics\u2019 governance.7<\/sup> Alta Fox is committed tocontinuing to push for the governance reforms that Daktronics desperately needs and ensuring that the rights of all shareholders are upheld.<\/p>\n \nIf Alta Fox prevails in our lawsuit, or if Daktronics rescinds the Reincorporation Proposal, we plan to immediately call a special meeting at which we will seek shareholder approval to:<\/p>\n \n***<\/p>\n Alta Fox encourages Daktronics stakeholders to visit <\/i>www.FixDaktronics.com<\/i><\/a> to review our presentation exposing how poor governance and a private family business mentality have driven massive underperformance for shareholders.<\/i><\/p>\n About Alta Fox<\/span><\/b><\/p>\n \nFounded in 2018 by Connor Haley, Alta Fox is a Texas-based alternative asset management firm that employs a long-term focused investment strategy to pursue exceptional risk-adjusted returns for a diverse group of institutions and qualified individual clients. Alta Fox focuses on identifying often overlooked and under-the-radar opportunities across asset classes, market capitalization ranges and sectors. Learn more by visiting www.AltaFoxCapital.com<\/a>.<\/p>\n Certain Information Concerning the Participants<\/span><\/b><\/p>\n \nAlta Fox Opportunities Fund, LP (\u201cAlta Fox Opportunities\u201d), together with the other participants named herein (collectively, \u201cAlta Fox\u201d), has filed a preliminary proxy statement and an accompanying BLUE proxy card with the Securities and Exchange Commission (\u201cSEC\u201d) and intends to solicit votes in connection with their opposition to proposals to be presented at a special meeting of shareholders of Daktronics, Inc., a South Dakota corporation (the \u201cCompany\u201d).<\/p>\n \nALTA FOX STRONGLY ADVISES ALL SHAREHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT AND OTHER PROXY MATERIALS, INCLUDING ITS BLUE PROXY CARD, AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEB SITE AT HTTP:\/\/WWW.SEC.GOV<\/a>. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS’ PROXY SOLICITOR.<\/p>\n \nThe participants in the proxy solicitation are expected to be Alta Fox Opportunities, Alta Fox GenPar, LP (\u201cAlta Fox GP\u201d), Alta Fox Equity, LLC (\u201cAlta Fox LLC\u201d), Alta Fox Capital Management, LLC (\u201cAlta Fox Capital\u201d) and P. Connor Haley (collectively, the \u201cParticipants\u201d).<\/p>\n \nAs of the date hereof, Alta Fox Opportunities directly beneficially owns 5,933,019 shares of Common Stock, no par value (the \u201cCommon Stock\u201d), of the Company. Alta Fox Capital, as the investment manager of Alta Fox Opportunities, may be deemed to beneficially own the 5,933,019 shares of Common Stock beneficially owned by Alta Fox Opportunities. Alta Fox GP, as the general partner of Alta Fox Opportunities, may be deemed to beneficially own the 5,933,019 shares of Common Stock beneficially owned by Alta Fox Opportunities. Alta Fox LLC, as the general partner of Alta Fox GP, may be deemed to beneficially own the 5,933,019 shares of Common Stock beneficially owned by Alta Fox Opportunities. Mr. Haley, as the sole owner, member and manager of each of Alta Fox Capital and Alta Fox LLC, may be deemed to beneficially own the 5,933,019 shares of Common Stock beneficially owned by Alta Fox Opportunities.<\/p>\n CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS<\/b><\/p>\n \nThe information herein contains \u201cforward-looking statements.\u201d Specific forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and include, without limitation, words such as \u201cmay,\u201d \u201cwill,\u201d \u201cexpects,\u201d \u201cintends,\u201d \u201cbelieves,\u201d \u201canticipates,\u201d \u201cplans,\u201d \u201cestimates,\u201d \u201cprojects,\u201d \u201cpotential,\u201d \u201ctargets,\u201d \u201cforecasts,\u201d \u201cseeks,\u201d \u201ccould,\u201d \u201cshould\u201d or the negative of such terms or other variations on such terms or comparable terminology. Similarly, statements that describe our objectives, plans or goals are forward-looking. Forward-looking statements relate to future events or future performance and involve known and unknown risks, uncertainties, and other factors that may cause actual results, levels of activity, performance or achievements or those of the industry to be materially different from those expressed or implied by any forward-looking statements. Daktronics, Inc., a South Dakota corporation, has also identified additional risks relating to its business in its public filings with the Securities and Exchange Commission (the \u201cSEC\u201d). Alta Fox Capital Management, LLC (together with its affiliates, \u201cAlta Fox\u201d), has based these forward-looking statements on current expectations, assumptions, estimates, beliefs, and projections. While Alta Fox believes these expectations, assumptions, estimates, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which involve factors or circumstances that are beyond Alta Fox\u2019s control. There can be no assurance that any idea or assumption herein is, or will be proven, correct. If one or more of the risks or uncertainties materialize, or if the underlying assumptions of Alta Fox described herein prove to be incorrect, the actual results may vary materially from outcomes indicated by these statements. Accordingly, forward-looking statements should not be regarded as a representation by Alta Fox that the future plans, estimates or expectations contemplated will ever be achieved. You should not rely upon forward-looking statements as a prediction of actual results and actual results may vary materially from what is expressed in or indicated by the forward-looking statements. Except to the extent required by applicable law, Alta Fox will not undertake and specifically declines any obligation to disclose the results of any revisions that may be made to any projected results or forward-looking statements herein to reflect events or circumstances after the date of such projected results or statements or to reflect the occurrence of anticipated or unanticipated events.<\/p>\n \nCertain statements and information included herein have been sourced from third parties. Alta Fox does not make any representations regarding the accuracy, completeness or timeliness of such third party statements or information. Except as may be expressly set forth herein, permission to cite such statements or information has neither been sought nor obtained from such third parties. Any such statements or information should not be viewed as an indication of support from such third parties for the views expressed herein.<\/p>\n 1<\/sup> Alta Fox press release dated December 10, 2024. Link<\/a>. View source version on businesswire.com: <\/span>https:\/\/www.businesswire.com\/news\/home\/20250204828929\/en\/<\/a><\/span><\/p>\n \nFor Shareholders:<\/p>\n Alta Fox Investor Relations or<\/p>\n Okapi Partners For Media:<\/p>\n
\nAlta Fox Capital Management, LLC (together with its affiliates, \u201cAlta Fox\u201d or \u201cwe\u201d), the largest shareholder of Daktronics, Inc. (NASDAQ: DAKT) (\u201cDaktronics\u201d or the \u201cCompany\u201d) based on its beneficial ownership interest on a fully converted basis of 11.7% of the Company\u2019s outstanding shares, today announced that it has filed a lawsuit against the Company and Chairman, President and Chief Executive Officer Reece A. Kurtenbach in the United States District Court for the District of South Dakota.<\/p>\n\n
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2<\/sup> Alta Fox press release dated December 10, 2024. Link<\/a>.
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3<\/sup> Alta Fox press release dated December 11, 2024. Link<\/a>.
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4<\/sup> The Company\u2019s definitive proxy statement for its 2024 annual meeting. Link<\/a>.
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5<\/sup> The Company\u2019s statement dated November 8, 2024, implied that the value of Alta Fox\u2019s promissory note is based on face value or a Black Scholes model. For Alta Fox and likely any other shareholder, the value of the in-the-money convertible securities is the market value of the converted shares (approximately $79.5 million). Link<\/a>.
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6<\/sup> Breach Inlet Capital, LP press release dated December 17, 2024. Link<\/a>. Anchor Capital Advisors, LLC press release dated January 27, 2025. Link<\/a>. Breach Inlet Capital, LP press release dated February 4, 2025. Link<\/a>.
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7<\/sup> Alta Fox press release dated December 10, 2024. Link<\/a>.<\/p>\n<\/p>\n
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ir@altafoxcapital.com
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Bruce Goldfarb \/ Chuck Garske, 212-297-0720
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info@okapipartners.com
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