CALVERTON, N.Y., Oct. 28, 2004 (PRIMEZONE) -- AdZone Research, Inc. (OTCBB:ADZR), a provider of pioneering Internet surveillance and event tracking technology, reported today that its Chairman & CEO, Charles A. Cardona, has issued the company's latest operational report to shareholders. The full text of his message follows:
October 28, 2004
Dear Fellow Shareholders:
During the month of October, the necessary validation process of the company's Global Defense Group's technology continued. It is continuing according to the timetable set by the U.S. Government. We also moved forward with our efforts to accelerate international development of our commercial division as well. In that connection, the Board of Directors on October 13 approved the company's first dividend to shareholders of record as of October 20.
The dividend will be paid in securities issued to the company by Senticore, Inc. (OTCBB:SNIO) -- both freely trading shares and warrants exercisable into freely trading shares. The Senticore securities are part of its initial payment for participation in the $2.5 million, multi-year commercial division contract announced last month. Upon the effectiveness of a Senticore registration statement covering these shares and warrants, AdZone's transfer agent will distribute 90% of the initial payment from Senticore, or $135,000. As part of that distribution, both my brother, COO John A. Cardona, and myself, have exempted those shares we would have received to increase the value of the payout to other holders.
Senticore and The Justice Fund (TJF), a soon to be public company, have signed a non-exclusive contract with AdZone, calling for Senticore and TJF to jointly distribute and market NetGet's Internet commercial applications in both Asia and South America over the next four years. Recently, the company had several inquiries regarding our transaction with Senticore. I asked our investment banker at The Nutmeg Group, Randall S. Goulding, to respond to these comments. Here is his reply:
"The Nutmeg Group saw a potential synergy between Senticore, The Justice Fund, and AdZone Research, and a way all three might benefit.
"The Nutmeg Group is a value added investment firm that is committed to the financial success of both Senticore and AdZone Research and feels confident of the management capabilities of both companies, a prerequisite for its sizeable investment in both.
"As a value added investment company, The Nutmeg Group attempts to provide services to improve its portfolio companies. Additionally, our greatest returns have resulted from our unique ability to facilitate strategic relationships, of which this is a prime example.
"Not only have we already invested approximately $1.1 million in AdZone, we are committed to investing another $750,000 before the end of the year, if we are permitted to do so by the company.
"With AdZone's technology achieving this level of critical recognition, especially through its involvement with the U.S. Government, it already has proven to be the harbinger of many other opportunities, especially on the commercial front. Very truly yours, Randall S. Goulding, Managing Director, The Nutmeg Group."
We are, in fact, very much looking forward to The Nutmeg Group investing that additional $750,000 in operating capital as soon as the SB-2 covering the transaction is declared effective. Meanwhile, we also are continuing our efforts to identify and to acquire defense-related companies with immediate revenue generating applications and that are profitable.
As to our release last week about online advertising revenues increasing for the third straight month, a long-term shareholder questioned the wisdom of giving away such information without a payback. In fact, as we responded to him, we have always provided the media with this kind of top line ad expenditure information. It is now becoming increasingly more important to do so with more dollars being spent on online advertising.
We do this to allow the media to use AdZone as a benchmark point of reference, and position us as an ongoing resource for their current and future articles related to the Internet and advertising on it, as well as identify whom AdZone is, and what it is about.
This long- term media relations strategy allows us to showcase our research in major financial publications and on business news TV programs, further enhancing the visibility of the company. Our ongoing goal is to become one of the primary sources for comment and analysis related to online media intelligence. As we concluded: to coin a popular credit card commercial: the benefit of AdZone being referred to in a third party validation story of its Internet monitoring capabilities: priceless.
In conclusion, we urge everyone to remember that this coming Tuesday is Election Day. It is the opportunity for all eligible Americans to cast their vote for those whom they believe can best lead our cities, counties, states and nation in a period of unprecedented challenge for us all in the years ahead.
God Bless America, and all who stand with us and for us, to defend the privileges we all enjoy as citizens of the world's greatest nation. Our personal liberties, hard fought for and diligently defended, continue to be the envy of others worldwide.
To those shareholders who have called and written to express continued support of AdZone and its mission, our continued thanks.
On behalf of everyone at the company, we wish for all of you, your family and friends, a very safe, happy and enjoyable Thanksgiving holiday, at a time when we need to give thanks more than ever. We look forward to reporting directly to you again at the end of November.
Sincerely, Charles A. Cardona III Chairman & CEO
AdZone Research is headquartered in Calverton, N.Y., in a facility that formerly housed major defense contractor Northrop Grumman Corporation. The facility was earlier used for top-secret defense research and development, and was part of the United States Navy's Naval Defense Technology Center.
Through monitoring of more than 500,000 Web sites worldwide, AdZone provides tracking and monitoring of targeted information on the Internet, with an expanded focus on global Internet analysis of security-related data transmissions. For additional information, please visit the company's Web site at http://www.adzoneresearch.com.
Certain statements contained herein are "forward-looking" statements (as such term is defined in the Private Securities Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.