(Feb.27, 2004) Herzliya, Israel – VCON (Nouveau Marché ISIN Code: IL 00 108 30540), a worldwide leader in audio and videoconferencing solutions, today releases additional information concerning the signing, on January 21, 2004 of an agreement in relation to a private placement of up to US $10 million (€ 7.9 million) which was announced on January 27, 2004. On the date of the signing of the agreement, the price per share, which may be subject to downward adjustment upon closing (as described in VCON's press release of January 27, 2004), was calculated to be approximately US$0.79 (€ 0.63). In the event that there is no downward price adjustment, VCON will, upon closing of the transaction, issue to the investors 12,683,402 ordinary shares. The issue of these shares will result in VCON having 29,819,097 ordinary shares in issue; in this case, the total number of shares to be issued pursuant to the transaction would represent 42.5% of VCON's resulting issued share capital. The effect of this issue of shares on a shareholder holding, pre-transaction, 1% of the share capital of VCON, and not subscribing in the placement would be to reduce such holding to 0.575%, post-transaction. Based on VCON's audited balance sheets for December 31, 2003 (i) the total consolidated equity per share will increase from US $0.60 (€ 0.47) (pre-transaction) to US $0.68 (€ 0.54) (post-transaction) and (ii) the total shareholders' capital per share will decrease from US $4.13 (€ 3.28) (pre-transaction) to US $2.71 (€ 2.15) (post-transaction). (All US $ amounts in this press release are, for convenience, converted to € amounts based on an exchange rate of 1 € = 1.26 US $). Post-transaction, assuming that there is no downward price adjustment, two groups of shareholders, Index Ventures and Pitango, will each hold, directly or indirectly, more than 20% of VCON’s resulting share capital and the total number of shares held by the public through Euroclear will represent 27% of such share capital (pre-transaction, the public float held through Euroclear represents 47% of the issued share capital of VCON). Pursuant to the agreement, VCON will, following the closing, apply for the listing of the newly issued shares on Le Nouveau Marché. The proceeds of this financing will be used for (i) the marketing and selling of VCON's new products and technologies, including its HD new group systems line of products which was announced earlier this month, (ii) further development and integration within VCON's offerings of its new products and technologies, including those technologies acquired from NetMount and RemoteAbility (details of which were announced on November 5, 2003), (iii) funding the Company's working capital, (iv) strengthening the Company's balance sheets and liquidity (VCON's cash position being approximately US $ 4 million as at January 2004) and (v) general corporate purposes. The agreement provides that all conditions precedent to closing must be fulfilled within 120 days from the date of signing, unless otherwise agreed by the parties. However, the parties expect to close the transaction within the next two months, provided that all conditions precedent are fulfilled. The key conditions precedent to the closing of the transaction are (i) satisfactory completion of the due diligence process by the investors, (ii) approval of VCON's banks and (iii) approval of the Office of the Chief Scientist and the Israeli Investment Centre. |
