OXFORD, Miss., Feb. 1, 2005 (PRIMEZONE) -- Modern Technology Corp. (OTCBB:MOTG), a business development and acquisition company, announced today that it has acquired Sound City, Inc., headquartered in Towaco, New Jersey. Sound City, a specialty audio video consumer electronics retailer, markets its products using a diversified distribution strategy through its Web site, direct mail, retail store and a custom Home Theater Installation department.
Sound City's 2003 revenues were approximately $12,000,000 with projected revenues resulting from additional expansion and marketing efforts for 2004 to be in excess of $9,000,000 and with projected 2005 revenues for MOTG and its portfolio to be in excess of $20MM through internal growth and further planned acquisitions. Sound City's retail store format, custom installation model and nationwide acquisition strategy is similar to and parallels the successful model of Tweeter, Inc. (Nasdaq:TWTR)
"Sound City is an important addition to our portfolio," said Anthony K. Welch, chairman of Modern Technology Corp. "Given its high-growth markets, its successful 18-year operating track record, and its exceptionally talented management team, we firmly believe Sound City has the potential to significantly grow its already strong base of approximately 900,000 customers."
"Coming under the Modern Technology Corp. umbrella allows Sound City to achieve its strategic goals more quickly and easily," said Kamel Yassin, Chairman/CEO of Sound City, Inc. "We now have a partner to help us implement our growth strategies, run operations and further increase our existing revenue streams. The timing could not be better to exploit our high growth markets, including the HDTV and flat-panel TV segment which is expected to double in 2005."
Under the terms of the agreement, Modern Technology Corp. acquired 51% of Sound City for $2.0 million paid in a combination of cash and Convertible Notes. Under additional terms of the Agreement, MOTG has an option to purchase the remaining 49%. Sound City's existing management will continue to run operations in its current locations. Kamel Yassin will lead Modern Technology Corp.'s division for nationwide retail acquisitions in order to bring new consumer electronics stores under the Sound City model to gain market share from incumbent home entertainment retailers such as Circuit City (NYSE:CC) and Best Buy (NYSE:BBY).
With the Sound City acquisition, Modern Technology Corp. continues to successfully execute its strategy of growth through strategic acquisitions, market development and revenue expansion. The Modern Technology acquisition model seeks to consistently build market value while simultaneously mitigating, or eliminating, negative dilution of common stock. Modern Technology Corp. recently added DeMarco Energy Systems (PinkSheets:DMES) to its portfolio of companies, and will continue to announce additional acquisitions. Modern Technology Corp. plans to release details on its growth and revenue projections for 2005 and its plans for listing its Common Stock on a larger exchange in the near future.
About Sound City, Inc.
Founded in 1986, Towaco, New Jersey-based Sound City, Inc. is a leading consumer electronics company with over 900,000 customers across the U.S. Sound City markets audio and video solutions for home and mobile environments, including the fastest-growing HD-TV, Plasma and LCD segments. In addition, the company's expertise in the custom home theater market provides a unique competitive advantage to consumers. As a full service dealer, Sound City provides a wide range of custom home installations addressing numerous applications. As one of the largest electronics mail order companies in the U.S., with a customer base of over 900,000 customers, the company distributes its solutions through its direct mail and Web site channels. Consumers can also find the latest audio, video, car stereo and home theatre products in Sound City's retail locations, including 12 custom showrooms.
About Modern Technology Corp.
Founded in 1982, Oxford, Mississippi-based Modern Technology Corp. (MOTG) is a business development and acquisition company, focused on growth by strategic acquisitions and subsequent market and revenue expansion. MOTG provides business infrastructure, substantial intellectual capital, strategic investments, and ongoing support and revenue growth assistance to each individual company within its portfolio. In addition, MOTG provides mentoring and assistance through collective operations experience, significant industry contacts, and strategic and tactical advice. The company's mission is to consistently build shareholder equity through accretive acquisitions, to continue providing both stock and cash dividends to its shareholders, and to create and promote synergistic relationships among portfolio companies and affiliates. For more information, visit the company's web site at: http://www.moderntechnologycorp.com.
Safe-Harbor Statement
This press release contains statements (such as projections regarding future performance) that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to those detailed from time to time in the Company's filings with the Securities and Exchange Commission.