Earn-out agreement provides additional flexibility for BSM's continued growth
TORONTO, Oct. 16, 2017 /CNW/ - BSM Technologies Inc. ("BSM" or the "Company") (TSX: GPS), a leading provider of real-time GPS fleet and asset management solutions, today announced that, further to its previously announced acquisition of substantially all of the assets of MBCR Dissolution Corp. (formerly Mobi Corp.) (the "Seller") in October 2016 (the "Transaction"), the parties have reached an agreement (the "Agreement") where, among other things, the Company, through its subsidiaries, will pay the Seller US$4,750,000 in lieu of any additional earn-out consideration the Seller may have been entitled to under the Transaction. Pursuant to the terms of the Transaction, the Company paid initial cash consideration of US$8,000,000 to the Seller and the Company made a subsequent payment of US$2,000,000 to the Seller for the achievement of its first earn-out target. Under the original terms of the Transaction, in addition to these payments, the Seller was eligible to receive additional earn-out payments worth up to an additional US$15,000,000 upon the completion of certain financial targets. By reaching this Agreement, the Company paid a total of US$14,750,000 before working capital adjustments pursuant to the Transaction and there will be no further payments required to complete the Transaction.
"The certainty and added flexibility provided by finalizing the Mobi earn-out payment and post-closing obligations will, we believe, enable BSM to accelerate our software platform consolidation plans and allow us to enhance our cross-selling opportunities via improved organizational efficiency," said Aly Rahemtulla, BSM's President and Chief Executive Officer. "One year of ownership has confirmed our investment thesis as we have observed the teams at Mobi perform above expectations, reaffirmed the quality of the technology and received positive feedback from our customers on the Mobi solution. We anticipate that accelerating the Mobi software platform consolidation will expand our customer footprint and enable future customer growth."
Change in Senior Officers
The Company also announced today that Mr. Lawrence (Larry) Juba will be retiring and leaving his position as Chief Operating Officer ("COO") of the Company, effective immediately. The Company further announced today that Mr. Peter Callaghan will be leaving his position as Chief Sales Officer ("CSO") of the Company, effective immediately.
"On behalf of our employees, the senior management team and the board of directors, I want to thank Larry and Peter for their dedicated service to BSM and Webtech," said Aly Rahemtulla, President and Chief Executive Officer of BSM. "We wish them all the best in their future endeavours."
"Working at BSM and Webtech has been a very rewarding experience," said Mr. Juba. "I am very proud of all that we have accomplished during my tenure as COO. With a strong senior leadership team remaining, I am confident that BSM is well positioned for future growth."
The functions that were formerly the responsibility of the COO and the CSO will be assumed by the Company's continuing senior management team.
About BSM Technologies Inc. (bsmtechnologies.com)
BSM Technologies Inc., through its subsidiaries, is a global top 20 commercial fleet telematics provider for automatic vehicle location (AVL) solutions that improve efficiency, accountability and reduce costs for fleet operators. BSM's end-to-end solutions automate record keeping and regulatory compliance, reduce fuel burn and idling, mitigate risk, and keep drivers safe. BSM provides solutions for commercial and government divisions who manage and operate diverse assets and large fleets that utilize its integrated fleet tracking, fleet maintenance, and intelligent business engine which provides real time, web‐based tracking of mobile and fixed assets.
For more information, please visit http://www.bsmtechnologies.com
Cautionary Note Regarding Forward-Looking Statements
This news release includes certain forward-looking statements or information under applicable Canadian, U.S. and other securities laws. Such forward-looking information and statements are often, but not always, identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "expect" and "intend" and statements that an event or result "may", "will", "should", "could", or "might" occur or be achieved and any other similar expressions. Such forward-looking information includes but is not limited to, statements with respect to the timing and scope of the Company's software platform consolidation, the impact of Mobi software platform consolidation and the Company's ability to capitalize on future customer opportunities. These forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business and include, but are not limited to, the Company efficiently and successfully completing a software platform consolidation and developing an enhanced enterprise solution, and current and future customers reacting positively to the enhance enterprise solution leading to increased commercial growth. Management believes that these assumptions are reasonable; however, some risks include, but are not limited to, failing to efficiently or successfully complete the software platform consolidation, failing to develop an enhanced enterprise solution and customer's being unsatisfied with the software platform consolidation or the enhance enterprise solution. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those contained in the forward-looking information. Some of these risks, uncertainties and other factors are described under the heading "Risk Factors" in BSM's most recent annual information form available at www.sedar.com. Forward-looking statements or information are based on estimates and opinions of management at the date the statements are made. Except as required by applicable law, BSM does not undertake any obligation to update forward-looking information. Readers should not place undue reliance on forward-looking information.
SOURCE BSM Technologies Inc.
For further information: Aly Rahemtulla, President & CEO, BSM Technologies Inc., (416) 675-1201, [email protected]; Marc Lakmaaker, Investor Relations, NATIONAL Equicom, (416) 848-1397, [email protected]