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ACD Systems' logo. Click here to visit the ACD Systems website! ACD announce Deneba acquisition
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(Thursday, April 10, 2003 - 02:42 EDT)

A press release distributed by ACD Systems International Inc. and Deneba Systems Inc. announces that the two companies will be merging in a $5.5 million deal.

ACD will acquire all shares of Deneba, which makes CAD, illustration and photo-sharing software, in exchange for $4.5 million in cash and $1 million in shares of ACD. Deneba shareholders will be able to reallocate a further $1.5 million of the cash as shares with a 20% premium if they should choose to. A further $2 million may be payed if Deneba, which made a $4.6 million profit last year, should meet undisclosed revenue and profit targets in the first year after the acquisition.

A note from Dave: Back in the days when I cared about line drawing vs airbrush and cloning tools, a much (!) prior version of Deneba's Canvas was my hands-down favorite drawing tool on my Mac. They're now cross-platform, and have added so many tools and features I'd likely not recognize the program any more, but the earlier versions were great: Very powerful, yet very logical and easy to use...

Original Source Press Release:

ACD Systems and Deneba Announce Merger of Software Leaders

Victoria, British Columbia - April 7, 2003 - ACD Systems International Inc. (TSX: ASA), and Deneba Systems Inc., today announced that they have entered into a definitive merger agreement where ACD will acquire all of the issued and outstanding shares of privately-held Deneba for total consideration of US$5.5 million. The US$5.5 million of consideration includes US$4.5 million of cash with the remainder payable in ACD common shares. Deneba shareholders can elect to reallocate up to US$1.5 million of the cash consideration to ACD shares and will receive a 20% premium on value for any such reallocated proceeds. The purchase price is subject to downward closing adjustment based on Deneba's net working capital position at closing. Closing is scheduled to occur in the next 21 days, subject to certain conditions. Additional consideration of up to US$2.0 million may be payable if Deneba meets specified increased revenue and profit targets in the first post-acquisition year.

Deneba Systems Inc. is the Miami Florida based developer of Canvas, a unique cross-platform precision illustration solution that integrates award-winning Sprite technology, photo editing, page layout, presentation, and Web graphics capabilities. In business since 1986, Deneba has a large and loyal following among corporate oriented digital graphics users.

In its fiscal year ending December 31, 2002, Deneba completed another profitable year on revenue of approximately US$4.6 million. Deneba's existing management will continue in executive roles with the combined companies.

"This is a marriage of two strong companies with similar philosophies and commitment to high quality engineering," said Mike Zelen, president and chief executive officer of ACD Systems. "Our respective flagship products are extremely complementary, particularly with Deneba's core user group. Moreover, the fact that Deneba has engineered Canvas to fit within ACD's highly evolved and profitable electronic sales and distribution (ESD) channel will take the combined companies into new and exciting territory."

"We are very excited at the potential unleashed by the union of our two companies," said Manny Menendez, president of Deneba. "The merged organization will be in an excellent position to maximize the value of our technology assets and to leverage those assets through ACD Systems' amazing Internet distribution channels and global network of distributors."

About ACD Systems International Inc.
Headquartered in British Columbia since 1993, ACD Systems International (TSX:ASA) is one of the world's leading developers and marketers of digital imaging software. ACD has penetrated the global marketplace through advanced Internet distribution and strategic partnerships with manufacturers and developers. ACD has millions of consumer users and over 33,000 corporate customers including many Fortune 500 companies. The company has a history of solid revenue growth. For further details, please visit us at our corporate web site: www.ACDSYSTEMS.com

About Deneba Systems Inc.
Headquartered in Miami, Florida USA since 1986, Deneba Systems is a leading developer and publisher of design graphics and technical illustration software for both Windows® and Mac OS-based computers. Deneba's award-winning products are available in multiple languages and are sold around the world via internet distribution and through a network of authorized resellers and distributors.

###

THIS NEWS RELEASE MAY CONTAIN FORWARD-LOOKING STATEMENTS BASED ON THE
ESTIMATES AND OPINIONS OF MANAGEMENT AT THE DATE THE STATEMENTS WERE
MADE AND THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE FORWARD-LOOKING
STATEMENTS IF CONDITIONS OR OPINIONS SHOULD CHANGE.

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