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EXHIBIT 10.7
SHARE PURCHASE AGREEMENT
OLICOM A/S
(A/S xxx.xx. 101.733)
- hereinafter called "the Vendor" -
and
NILEX SYSTEMS APS
(ApS xxx.xx. 100.247)
- hereinafter called "the Purchaser" -
have today entered into the following Agreement concerning the Purchaser's
acquisition of the entire share capital ("the Shares") of OLICOM VENTURES A/S
(A/S xxx.xx. 61.269) ("the Company").
NOW IT IS HEREBY AGREED as follows:
1. SALE AND PURCHASE OF SHARES
1.1. The entire registered share capital of the Company is DKK 300,000
issued as A-shares in the amount of DKK 150,000 and B-shares in the
amount of DKK 150,000.
1.2. The Vendor agrees as owner to sell all the Shares, and the Purchaser
agrees to purchase the same, on the Completion Date free and clear
from any encumbrances and other adverse interests except for the
rights stipulated for in Section 3.2. and with the benefit of all
rights for the consideration specified below and subject to the terms
and conditions of this Agreement.
1.3. The Purchaser shall not be obliged to complete the purchase of any of
the Shares unless the sale and purchase of all the Shares is completed
contemporaneously.
1.4. The Shares and the Company's shares in Contex shall forthwith upon
signature of this Agreement be deposited with Advokatfirmaet O. Bondo
Svane, Xxxxxxxxxx Xxxxx 0, XX-0000 Xxxxxxxxx E., duly endorsed for
transfer to be released to the Purchaser as stipulated in Sections
3.1. and 3.3.
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2. THE PURCHASE PRICE AND ACQUISITION FINANCIAL STATEMENT
2.1. The purchase price for the company's Shares and the "Debtnote to the
Mothercompany" has been agreed to:
Total purchase price of DKK 41,000,000
2.2. The Company is a holding company and the purchase price has therefore
been based on a valuation of the only asset transferred in this
transaction, the Company's shares in Contex A/S (A/S reg. no. 177.072)
including goodwill.
2.3. The audited financial statement of the Company at the end of fiscal
1995 Schedule 1 contains assets and liabilities that are not subject
to this Acquisition. The Vendor shall before or at completion arrange
that all other assets than those mentioned in Section 2.2. are
disposed of, and that the Company has no liabilities other than "tax
payable", "The Debtnote to the Mothercompany", "Share Capital" and
"Reserves". The balance sheet of "the Acquisition Financial Statement"
shall thus contain nothing but the following:
Assets as of 30 September 1995 DKK
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1. Shares in Contex in the nominal
amount of DKK 427,700 . . . . . . . . . . . . . . . . . . . . . . . . . 20.350.448
2. Concern goodwill in Contex . . . . . . . . . . . . . . . . . . . . . . . . 5.136.865
3. Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.487.313
Liabilities:
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A. Share capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300.000
Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.272.724
Carried forward . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.560.715
Total Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.133.439
B. Debtnote to Mothercompany (Olicom A/S) . . . . . . . . . . . . . . . . . . 1.353.874
Tax liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0
Total Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.487.313
2.4. The 1993 and 1994 financial statements of the Company are attached
hereto as Schedule 2. All assets and liabilities except for those
contained in Section 2.3. above shall have been disposed of, paid or
otherwise removed from the balance sheet of the Company as at
completion.
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2.5. The 1995 financial statements and the Acquisition Financial Statement
shall be audited by the Company's auditors, Revisionsfirmaet Ernst &
Young A/S, who shall verify that the Acquisition Financial Statement
is in accordance with Sections 2.2. and 2.3. The Annual Financial
Statement for 1995 and the Acquisition Financial Statement shall be
available and signed by the Company's auditors not later than 2 weeks
after the Completion Date.
2.6. The Purchaser warrants that the tax obligations of the Company will be
met in a timely manner. Olicom warrants that the Company's tax
obligation is zero.
3. TERMS OF PAYMENT AND SECURITY
3.1. The purchase price shall be paid in two installments by the Purchaser
as follows:
(a) DKK 15.000.000, cash on the Completion Date.
(b) DKK 26.000.000, to be paid no later than 30 days after
Completion, provided none of the representations and
warranties have become effective in a relevant manner.
The installment (b) shall carry 4,0% p.a. interest in favor of the
Vendor from the Completion Date.
3.2. Until payment of the installment as per Section 3.1. (b) the Vendor
shall retain a security interest in the Shares, whereas the Purchaser
after Completion Date will assume a proxy to vote on behalf of the
Company at the ordinary general assembly of Contex to be held at
January 31, 1996, where a special dividend will be declared to the
shareholders of Contex. During the interim period until second
installment Section 3.1 (b) the Purchaser will assume operational
power in conjunction with the Vendor.
3.3. The Purchaser shall have the right to withhold a relevant portion of
the installment as per Section 3.1. (b), should the Acquisition
Financial Statement contain other liabilities or assets than those
shown in Section 2.3.
4. COMPLETION
4.1. Completion shall take place on January 23, 1996 ("the Completion
Date"). Each of the conditions set out in Section 5.2. below shall
have been satisfied or waived.
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4.2. At Completion the Vendor shall deliver to the Purchaser:
(a) the Company's "vedtaegter" (Articles of Association),
"registreringsbevis" (resume from the Registrar of Companies
confirming the registration of the Company),
"aktionaer-fortegnelse" (the Company's register of
shareholders) and all "protokoller" (protocols containing all
minutes of shareholders meetings) and all other documentation
that is to remain with the Company;
(b) duly executed registration form for notification of the
transfer to "Statsskattedirektoratet" (the tax authorities);
(c) the written resignation of all shareholder elected directors
containing acknowledgments to the effect that such directors
have no claim against the Company for compensation for loss of
office or otherwise;
(d) copies of documentation on Contex A/S; "vedtaegter" (Articles
of Association") and "registreringsbevis" (resumes from the
Registrar of Companies confirming the registration of Contex
A/S;
4.3. The Purchaser shall on Completion Date, after receipt of the required
material regarding the Company, execute payment of the first
installment of the purchase price, cf. Section 3.1. (a).
4.4 The Purchaser agrees, that the Purchaser in no manner whatsoever can
use the name "Olicom Ventures" or derivatives thereof and that the
Company should not in the future be linked to the Olicom group, and
that the Purchaser will take immediate steps to change the name of the
Company in the Articles of Association.
4.5 The Purchaser is aware that the Company is formally a registered
development company with the Ministry of Commerce under the Vendor's
authorization and that the Vendor will apply for the Ministry's accept
of a transfer of the developing activities and the government
guarantee to another legal entity appointed by Olicom. The parties
expect to have the information regarding this no later than January
25, 1996. If the transfer is refused by the Ministry the Parties agree
to negotiate in good faith in order to reach a solution.
5. REPRESENTATION AND WARRANTIES
5.1. Subject to the matters disclosed in this Agreement and the Schedules
hereto, the Vendor hereby represent and warrant that:
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(1) Acquisition Financial Statement
The Company has no assets or liabilities other than those
shown in the Acquisition Financial Statement.
(2) Contex A/S
The Vendor is the rightful owner of the Company and the
Company's shareholding in Contex. With regard to the business
activities of Contex, the Vendor will refer to a written
declaration from the Managing Director of Contex which is
expected to be available no later than January 25, 1996
(Schedule 3). The Purchaser has detailed knowledge about
Contex and the Vendor sells the shares in Contex "as is",
hereunder without any liability for the contents of or the
correctness of the declaration from the Managing Director of
Contex.
5.2. The Purchaser is fully informed about the shareholders agreement in
force between the shareholders of Contex and the restrictions therein,
including preemption rights.
6. DELAY, BREACH ETC.
6.1. If at any time at or before Completion the Vendor fail to comply with
all or any of their obligations including without limitation the
obligations to be performed on or within 2 weeks after the Completion
Date in accordance with Sections 4 and 6 hereof, then the Purchaser
may by written notice to the Vendor elect:
(i) to rescind this Agreement, or
(ii) to fix (on one or more subsequent occasions) a new date for
completion in which event the terms of this Agreement
(including all the remedies available to the Purchaser) shall
continue to apply as if the date for completion so fixed was
the Completion Date already specified in Section 4 hereof.
6.2. If the Purchaser does not pay the full purchase price on time, the
transaction can be terminated by the Vendor without further notice. In
case of termination the Purchaser shall pay the Vendor's reasonable
costs and expenses and compensate the Vendor for losses in accordance
with the Danish legal practice. The Vendor's re- payment of any amount
paid by the Purchaser under Section 3.1. (a) shall be made.
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7. ANNOUNCEMENTS
7.1. Both before and after Completion the Vendor and the Purchaser shall
consult together as to the terms, time and manner of any announcements
to shareholders, employees, customers, suppliers or to the press or
otherwise of the sale and purchase hereby agreed or of any
supplemental or ancillary transaction.
7.2. No such announcement shall be made except in mutually agreed terms
save (in the absence of agreement) for any statement or disclosure
which may be required by law, including SEC and Nasdaq regulations or
standards, and any such statement or disclosure shall be no more
extensive than is necessary to meet the minimum requirements imposed
upon the party making such statement or disclosure.
8. EXPENSES
Each party shall pay its own expenses including legal fees, except the
share transfer duty which will be split between the Vendor and the
Purchaser.
9. GOVERNING LAW
9.1. This Agreement shall be governed by and construed in accordance with
Danish law, and the parties hereby submit any disputes to arbitration
under the rules of Det Danske Voldgiftinstitut to be held in
Copenhagen as regards any claim or matter arising under this
Agreement.
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Vendor: Purchaser:
for Olicom A/S for Nilex Systems ApS
Date: January 23, 1996 Date: January 23, 1996
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Name: /s/Xxx Xxxx Name: /s/ Lars Xxxx Xxxxxxx
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Name: /s/Xx Xxxxxxxx Name: /s/ Xxxxxxx Xxxxx
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Name: /s/Lars Xxxx Xxxxxxx
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