MDC Companions Particular Committee responds to Indaba Capital Administration, L.P.

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NEW YORK, May 26, 2021 / PRNewswire / – The Special Committee of Independent Directors of MDC Partners Inc. (NASDAQ: MDCA) ("MDC Partners" or the "Company") responded today to press reports indicating that Indaba Capital Management, LP ("Indaba") will vote against the proposed business combination (the "Combination") involving MDC Partners and Stagwell Media ("Stagwell") by stating the following:

"The MDC Special Committee, MDC executives, and Stagwell executives have met with Indaba several times over the past few months to highlight the many strategic benefits of the combination and the exceptional value-creation opportunity that the combination offers MDC shareholders. We are Disappointed Indaba has chosen to take its private concerns public, believing that its analysis and other suggestions are inaccurate and irresponsible.

"The Special Committee is pleased that most MDC investors appear to be realizing the value that the combination can create. Before announcing Stagwell's interest in combining with MDC on June 26, 2020, MDC shares closed at $ 1.15 per share. The MDC share closed $ 4.69 per share May 26, 2021In addition, the volume of shares traded has peaked at every point in time in 2019 and 2020. We have no doubt that a significant part of this increase in value and trade is due to the excitement for the combination and the belief of most shareholders that the combination will create the growth and cash flow that will create value for MDC shareholders in the future .

"The Select Committee agrees. We have worked tirelessly for MDC shareholders, sought advice from financial advisors, and negotiated over a long period of time to ensure MDC shareholders received fair value for their MDC stock. We are who. We are." firm belief that MDC shareholders should do so. " Welcome and support the combination that provides MDC with the opportunity to partner with leading digital and technology-driven marketing companies to create profitable growth opportunities and a better company.

"The Special Committee believes that Stagwell is a leader in technology, digital marketing and strategic communications and has consistently achieved high margins and double-digit sales and EBITDA growth since its inception. MDC is in the midst of a change but is not yet organic Growth has returned and continues to be constrained by high leverage on the balance sheet as well as a portfolio of agencies that are heavily focused on creative and traditional advertising.

"The fact is that this deal is strategically and financially compelling and recognized in the market. This conclusion is corroborated by the fact that ever since June 2020 When Stagwell reached out to MDC Partners with a public undertaking to bring the two companies together, there was a chance other buyers would emerge and no other party made any other proposal.

"It is unfortunate that, after several discussions with representatives from the Special Committee and MDC management, Indaba claims not to recognize the strategic merits of this transaction or the value it has already brought to MDC shareholders. Indaba opposes a transaction that was accepted by the market and resulted in a significant increase in MDC's share price. This endangers the merger, which is unfortunate for all MDC shareholders. We encourage other MDC shareholders to read our full proxy statement carefully for the merger vote and to protect the gains from the share price that have already resulted from the announcement of this attractive transaction. "

About MDC Partners Inc.

MDC Partners is one of the most influential marketing and communication networks in the world. MDC Partners is hailed as "The Place Where Great Talent Lives" for its innovative partners in advertising, PR, branding, digital, social and event marketing agencies for some of the most memorable and effective campaigns for the world's most respected responsible brands. Leveraging technology, data analytics, insights, and strategic consulting solutions, MDC Partners drives creative excellence, business growth, and measurable return on marketing investments for over 1,700 clients worldwide. For more information on MDC Partners and its partner companies, please visit our website at mdc-partners.com. Sign up for investor updates and notifications and follow us on LinkedIn.

Cautionary Note Regarding Forward-Looking Statements

This release may contain certain forward-looking statements (collectively, "forward-looking statements") within the meaning of Section 27A of the US Securities Act of 1933, as amended, and Section 21E of the US Exchange Act and the United States Private Securities Litigation Reform Act of 1995, as amended Version and "Forward-Looking Information" under applicable Canadian securities laws. Statements in this document that are not historical facts, including statements about the beliefs and expectations of MDC or Stagwell and recent business and economic trends, are forward-looking statements. Words like "estimate", "project", "aim", "predict", "believe", "expect", "anticipate", "potential", "create", "intend", "could", "should" " would "," could "," foresee "," plan "," will "," guidance "," look "," outlook "," future "," assume "," forecast "," concentrate "," continue " or the negative of such terms or other variations thereof and terms of similar substance used in connection with discussing current plans, estimates and projections may change due to a number of factors, including those described in this section. These forward-looking statements may include, but are not limited to, statements relating to the following: the future financial performance and prospects of the respective businesses and operations of MDC, Stagwell and the combined company; Information regarding the proposed transaction; the expected benefits of the proposed transaction; the likelihood that the proposed transaction will be completed; the expected outcome of the proposed transaction; the tax implications of the proposed transaction for MDC and MDC's shareholders; the timing of the general meeting to approve the proposed Transaction (the "Special Meeting"); shareholder approvals required for the proposed transaction; regulatory and stock market approval of the proposed transaction; and the timing of the implementation of the proposed transaction. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statements, including the risks identified in our filings with the SEC.

These forward-looking statements are subject to various risks and uncertainties, many of which are beyond the control of MDC. Important factors that could cause actual results and expectations to differ materially from those expressed in such forward-looking statements include the risks and uncertainties set out in the "Risk Factors" section of the registration statement on submitted Form S-4 on February 8, 2021and as amended March 29, 2021, April 21, 2021 and April 30, 2021 (the "Form S-4") as set out in the "Risk Factors" section in the am May 10, 2021 (along with Form S-4, the "Proxy Statement / Prospectus") and under the heading "Risk Factors" in the MDC Annual Report on Form 10-K for the past fiscal year December 31, 2020 under point 1A. These and other risk factors include, but are not limited to, the following:

  • Inability to obtain the anticipated benefits of the proposed transaction or the occurrence of difficulties related to the proposed transaction;
  • adverse tax consequences in connection with the Proposed Transaction for MDC, its business and its shareholders, which may differ from MDC or Stagwell's expectations, including future changes in tax law, potential increases in corporate tax rates in The United States and disagreements with tax authorities over the valuation of MDC and the calculation of its tax attributes can lead to increased tax costs.
  • the occurrence of a material federal Canadian income tax (including a material "emigration tax") as a result of the proposed transaction;
  • the impact of the uncertainty associated with the proposed transaction on the respective businesses of MDC and Stagwell;
  • direct or indirect costs related to the proposed transaction that could be higher than expected;
  • the risk that a condition for the completion of the proposed transaction may not be met and the proposed transaction may not complete; and
  • the risk of parties contesting the proposed transaction; or the impact of the proposed transaction on MDC's debt settlement.

You can obtain copies of the MDC filings from his profile on SEDAR at www.sedar.com, his profile on the SEC's website at www.sec.gov, or its website at www.mdc-partners.com. MDC assumes no obligation to update forward-looking statements as a result of new information, future developments or for other reasons, unless this is expressly required by law. All forward-looking statements in this release are qualified in their entirety by this cautionary statement.

Additional information and where to find it
In connection with the proposed transaction, the MDC and New MDC have filed the proxy statement / prospectus with the SEC. This announcement is not a substitute for the proxy statement / prospectus or any other document that MDC may file with the SEC in connection with the proposed transaction. Once effective, MDC will send the Power of Attorney / Prospectus to its shareholders in connection with the voting to approve certain matters relating to the proposed transaction.

INVESTORS AND SECURITY HOLDERS OF MDC ARE OBLIGED TO SUBMIT THE DECLARATION OF PROXY / PROSPECTUS IN ITS ENTIRETY WITH REGARD TO THE PROPOSED TRANSACTION (INCLUDING CHANGES OR ADDITIONS ABOUT THE TRANSACTIONS MADE BY THE TRANSACTION). Copies of the Power of Attorney / Prospectus and other relevant documents filed by the MDC or New MDC with the SEC can be obtained free of charge from the SEC's website at www.sec.gov. In addition, investors and security holders can obtain free copies of the Power of Attorney / Prospectus and other relevant documents filed by the MDC or New MDC with the SEC and on the MDC website at http://www.mdc-partners.com.

The URLs in this announcement are intended as inactive text references only. They are not intended to be active hyperlinks to websites. The information on such websites, even if they are accessible via a hyperlink resulting from the URLs or to which reference is made here, are not considered part of this announcement. No representation or warranty is made as to the suitability or reliability of any information on such websites for any purpose.

No offer or solicitation
This announcement constitutes neither an offer to buy or an exchange nor the solicitation of an offer to sell or an exchange of securities, nor is there a sale of securities in any jurisdiction in which such an offer, sale or exchange has been made beforehand It would have been illegal to register or qualify under the securities laws of such a jurisdiction. This announcement is not a substitute for any prospectus, power of attorney, or any other document that MDC or New MDC may file with the SEC in connection with the proposed transaction. No solicitation of funds, securities or other consideration will be made and, if sent in response to the information contained herein, will not be accepted.

No securities will be offered except by means of a prospectus that complies with the requirements of the US Securities Act of 1933, as amended. The proposed transaction and distribution of this document may be restricted by law in certain jurisdictions and persons in whose possession a document or other information referred to herein should find out about such restrictions. Failure to comply with these restrictions could constitute a violation of the securities laws of such jurisdiction. No offer of securities will be made, directly or indirectly, in or in any jurisdiction in which it would be inconsistent with the laws of that jurisdiction.

Participant in the call
MDC, New MDC and their respective directors and officers, as well as other members of management and employees, may be considered participants in the solicitation of proxies from MDC shareholders for the approvals required to complete the proposed transaction. More detailed information regarding the identity of these prospective participants and any direct or indirect interests they may have in the proposed transaction, through holdings of securities or otherwise, is contained in the proxy statement / prospectus filed with the SEC. Information regarding MDC's directors and officers is contained in the Definitive Proxy Statement on Appendix 14A, filed by MDC with the SEC on May 10, 2021 and in the Annual Report on Form 10-K filed by the MDC with the SEC on March 16, 2021as amended April 27, 2021. Additional information regarding attendees' interests in soliciting proxies in relation to the special meeting is included in the power of attorney / prospectus filed with the SEC. These documents are available free of charge to MDC shareholders on the SEC's website at www.sec.gov and on the MDC website at www.mdc-partners.com.

You must not interpret the contents of this document as legal, tax, regulatory, financial, accounting or other advice. You are urged to consult with your own advisers about the legal, tax, regulatory, financial, accounting and other consequences of the proposed transaction, the suitability of the proposed transaction for you, and other relevant matters related to the proposed transaction.

SOURCE MDC Partners Inc.

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