29th Jan 2009 16:25
January 29 2009
Telit Communications Plc
"Telit" or "the Company" or "the Licensor"
Trademark License Agreement and Related Party Transaction
Telit Communications plc (AIM: TCM), a global wireless communications developer and distributor, announces that it has entered into a Licensing Agreement ("the License" or "the Agreement") with Services for Electronic Manufacturing - SEM s.r.l. ("SEM"). Subject to the terms and conditions of the Agreement, Telit granted SEM a non-exclusive, non-transferable license under a licensed trademark to market, distribute and sell WiMAX products - Base Stations and Customer Premise Equipment - under the licensed trademark, worldwide. As consideration for the grant of the license, SEM shall pay Telit an amount equal to €3,500,000, payable in three fully secured cash instalments beginning in March 2010 and ending in March 2012.
As announced on 20 June 2007, within the framework of a strategic alliance, Telit Wireless Solutions s.r.l. ("TWS) (a 90 per cent. owned subsidiary of the Company) owns 19.9% of the share capital of SEM; the remainder being owned by Bartolini After Market Electronics Services s.r.l ("BAMES"), which in turn holds the remaining 10% of the share capital of TWS, as announced on 15 December 2008.
As BAMES is therefore a substantial shareholder in the subsidiary of an AIM Company the Agreement constitutes a related party transaction which requires disclosure by way of announcement under the AIM Rules, as the amount payable by the Licensee exceeds the five per cent. threshold in certain of the class tests under the AIM Rules for Companies.
The directors of Telit consider, having consulted with Seymour Pierce Limited (the Nominated Adviser of Telit), that the terms of the Agreement are fair and reasonable insofar as shareholders are concerned.
Oozi Cats, Chief Executive of Telit said: "the license agreement with SEM proves the strength of the Telit brand and technology and serves to further strengthen Telit's strategic alliance with BAMES and SEM. We look forward to the continued success of the strategic alliance".
Enquiries:
Telit Communications Plc Tel 00 972 3 791 40 40
Michael Galai, Finance director [email protected]
Maya Lustig, VP, Investor Relations [email protected]
Seymour Pierce Ltd Tel: 00 44 207 107 8000
Stuart Lane / Christopher Wren www.seymourpierce.com
Related Shares:
TCM.L