Regulated and Inside Information
Settlement Your Drinks, updates Auction Protocol, wind down,
Annual Accounts and General Meeting
To the shareholders:
London - 20 July 2017 at 08:30 hours CET
Introduction
In this notification, the Board wishes to inform and update the shareholders of the following:
A settlement between Your Drinks AG ("Your Drinks") and the Company / Algo Vision Systems GmbH ("AVS") finally settling all existing disputes, claims and costly court proceedings. A single payment of EUR 250,000 is made by the Company or AVS to Your Drinks. The claims Your Drinks stated to have against the Company and AVS of approximately EUR 1,500,000 are settled. Your Drinks agreed not to stand in the way of a dissolution or liquidation of the Company.
The (Financial) consequences of the settlement.
The proposed winding down of the Company and in that respect the proposed sale of assets, including an update on (the lack of bids under) the Auction Protocol and the intended sale of assets to a foundation (subject to shareholder approval).
An update regarding the intended date for publication of the Annual Accounts and the Company's General Meeting.
A summary of the next steps proposed by the Board.
Settlement with Your Drinks AG
As the Company disclosed in its announcement on 20 January 2017, Your Drinks filed legal proceedings in Germany against the Company's subsidiary AVS, demanding payment in aggregate of approximately EUR 1 million plus interest and costs pursuant to a Royalty Agreement entered into in 2014. Separate from these proceedings, Your Drinks and the Company were in dispute about a set-off against a claim of approx. EUR 0.5 million that Your Drinks believed to have against the Company, as well as other payment obligations resulting from loan- and financing agreements agreed between Your Drinks and the Company in 2014. Both the claim that was subject to the proceedings in Germany and the claims which were not subject to court proceedings were strongly contested by the parties. Both AVS and the Company disputed the validity of the agreements and claimed that the circumstances under which they were entered into gave rise to claims against Your Drinks. Your Drinks for its part contested these arguments and counter-claims.
In order to avoid the uncertainty and costs of protracted legal proceedings, and noting even if a success would finally be achieved, it had to be assumed that the claims may not be (fully) recoverable from Your Drinks, and furthermore having regard to the limited liquidity of the OIM-group, the Board considered it desirable to compromise the claims if suitable terms could be agreed. Parties were promoted by the suggestion of the Judge in the German Court that AVS and Your Drinks should attempt settlement negotiations.
The Board is therefore pleased to announce that a settlement has now been reached before the District Court of Berlin, in which Your Drinks, AVS and the Company are included. The terms of the settlement agreement are confidential. However the Board can state that the purpose and effect of the settlement is to settle all existing disputes between the parties, which concern not merely the claims that are subject of the proceedings but other related issues not yet brought into any proceedings and therefore include the abovementioned (disputed) claims against the Company and AVS and the liability claims of the Company and AVS against Your Drinks (as referred to in the Auction Protocol published on 3 February 2017).
Under the settlement agreement OIM or AVS makes a single payment to Your Drinks of EUR 250,000 and no further payments will be due from either company to Your Drinks. The settlement leaves unaffected the existing and future obligations of Your Drinks under an (extended) 5 million loan agreement from 2014 (noting that interest is again due from 1 January 2018 onwards) and the abovementioned Royalty Agreement. This includes, therefore, the payment of royalty fees as well as the repayment of a principal loan amount and the payment of interest from 1 January 2018 onwards. A further financing agreement from 2014 is considered completed and terminated with no remaining rights or obligations for any party.