MICRONET ENERTEC TECHNOLOGIES, INC. (NASDAQ:MICT) Files An 8-K Entry into a Material Definitive AgreementItem 1.01.Entry into a Material Definitive Agreement
On December 31, 2017, Micronet Enertec Technologies Inc. ( the “Company”), its wholly ownedsubsidiary, Enertec Management Ltd. and its wholly owned subsidiaryEnertec Systems 2001 Ltd. (“Enertec Systems”), entered into a Share Purchase Agreement (“Share Purchase Agreement”) with Coolisys Technologies Inc. (“Buyer”), a subsidiary of DPW Holdings, Inc. (“DPW”), to which the Company agreed to sell the entire share capital of Enertec Systems to the Buyer. As consideration for the sale of Enertec Systems’ entire share capital, the Buyer has agreed to pay at the closing of the transaction (“Closing”) a purchase price of $5.25 million (“Purchase Price”), of which $525,000 will be held in escrow for up to 14 months after the Closing to satisfy certain potential indemnification claims, as well as assume up to $4 million of Enertec Systems debt which consideration may be subject to certain adjustments set forth in the Share Purchase Agreement. Upon the signing of the Share Purchase Agreement, the Buyer agreed to deposit a termination fee of $300,000 into escrow to secure its obligations for Closing.
The parties’ obligations to consummate the Closing are subject to the satisfaction of customary conditions precedent set forth in the Share Purchase Agreement on or before the later of (i) 60 days after the signing of the Share Purchase Agreement or (ii) 15 days after the Company delivers to the Buyer the audited balance sheet and the related audited consolidated cash flows for the year ended December 31, 2017 for Enertec Systems, unless extended automatically by 30 days in accordance with the Share Purchase Agreement. The Company or Buyer may terminate the Share Purchase Agreement if such conditions precedent were not completed within the aforementioned period. The Share Purchase Agreement contains customary representations and warranties by the parties.
In conjunction with, and as a condition to, the Closing, the Company, Enertec Systems, the Buyer, DPW and Mr. David Lucatz, the Company’s Chief Executive Officer, agreed to execute a consulting agreement (the “Consulting Agreement”) whereby the Company, via Mr. Lucatz, will provide Enertec Systems with certain consulting and transitional services over a 3 year period as necessary and requested by the Buyer (but in no event to exceed 20% of Mr. Lucatz’s time). The Buyer (via Enertec Systems) will pay the Company an annual consulting fee of $150,000 as well as issue the Company 150,000 restricted shares of DPW Class A common stock (the “DPW Equity”) for such services, to be vested and released from restriction in three equal installments, with the initial installment vesting the day after the Closing and the remaining installments vesting on each of the first 2 anniversaries of the Closing. In the event of a change of control in the Company, or if Mr. Lucatz shall no longer be employed by the Company, the rights and obligations under the Consulting Agreement shall be assigned to Mr. Lucatz along with the DPW Equity.
The descriptions of the Share Purchase Agreement and Consulting Agreement are qualified in their entirety by reference to the complete text of the Share Purchase Agreement and Consulting Agreement which have been filed with this Current Report on Form 8-K as Exhibits 10.1 and 10.2, respectively.
WARNING CONCERNING FORWARD LOOKING STATEMENTS
This Current Report on Form 8-K contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws, and is subject to the safe-harbor created by such Act and laws. In some cases, readers can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms, or other variations thereon or comparable terminology. The statements herein and their implications are merely predictions and therefore inherently subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results to be materially different from those contemplated by the forward-looking statements. For example, when the Company states that the Closing is expected to occur on or before January 30, 2018, it is using forward looking statements. The Share Purchase Agreement contains various customary closing conditions and the Closing could be delayed or may not occur at all.The forward-looking statements contained in this report are subject to other risks and uncertainties, including those discussed in the “Risk Factors” section and elsewhere in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 and in subsequent filings with the Securities and Exchange Commission. Except as otherwise required by law, the Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
MICRONET ENERTEC TECHNOLOGIES, INC. ExhibitEX-10.1 2 f8k123117ex10-1_micronet.htm SHARE PURCHASE AGREEMENT,…To view the full exhibit click here
About MICRONET ENERTEC TECHNOLOGIES, INC. (NASDAQ:MICT)
Micronet Enertec Technologies, Inc. (Micronet Enertec) operates through Israel-based companies, which include Enertec Systems 2001 Ltd (Enertec), its subsidiary, and Micronet Ltd (Micronet), which develops, manufactures, integrates and markets rugged computers, tablets and computer-based systems and instruments for the commercial, defense and aerospace markets. The Company’s segments include defense and aerospace segment, and mobile resource management (MRM). The Company’s products, solutions and services are designed to perform in severe environments and battlefield conditions. Micronet operates in the commercial mobile resource management market and is a developer, manufacturer and provider of mobile computing platforms, designed for integration into fleet management and mobile workforce management solutions. Enertec operates in the defense and aerospace markets. Enertec designs, develops and manufactures computer based instruments and aerospace electronic solutions.
