Altris Software Announces Investment by Spescom Ltd
SAN DIEGO--(BUSINESS WIRE)--May 14, 1999--Altris Software, Inc. (OTCBB:ALTS) today announced that it had entered into a multi-part agreement with Spescom Ltd., a South African company publicly traded on the Johannesburg Exchange, whereby Spescom will invest $1.8 million for 2 million shares of Altris common stock.
In addition, as part of the agreement, Spescom will pay Altris an additional $1.0 million and invest $1.2 million directly into Altris Software Ltd. ("ASL"), a subsidiary of Altris, for a 60% ownership of ASL. In conjunction with the agreement Altris will contribute $400,000 into ASL and will retain a 40% interest in ASL.
In addition, Altris has entered into a distribution agreement with ASL which grants ASL exclusive distribution rights for Altris' products around the world excluding North and South America and the Caribbean. Under the distribution agreement, the exclusivity is contingent on ASL meeting certain minimum royalty commitments beginning in 2002.
ASL has also entered into a distribution agreement with Spescom providing that ASL will be Spescom's exclusive distributor for the same territory for EMS 2000, Spescom's configuration management (CM) product. In addition, the agreement provides that Altris will become Spescom's exclusive distributor of EMS 2000, in North and South America and the Caribbean.
Roger Erickson Altris' Chief Executive Officer stated "We are excited about the expanded relationship with Spescom. We have been selling our document management software integrated with Spescom's CM product for some time and have installed systems at such customers as BNFL, Bombardier, and London Underground. The extension of our relationship is a natural progression and will provide additional new opportunities for Altris."
Mr. Erickson added, "The additional capital in Altris will be of significant help in our sales and marketing activities while the company is transitioning to selling its new document management software, Altris EB."
Tony Farah, Chairman of Spescom stated "Expanding our relationship with Altris is consistent with Spescom's vision to become a global leader in the information technology industry. The investment will assist in expanding the markets for our EMS 2000 product by closely integrating the product with Altris EB."
In order for Altris to obtain consent to the agreement by Finova Capital (formerly Sirrom Capital), a debt holder and preferred stockholder of Altris, the interest rate on the Altris' outstanding convertible debenture held by Finova was increased from 11.5% to 12%. In addition, the conversion rate on the convertible preferred stock held by Finova has been adjusted from $6.00 per share of common stock to $1.90 per share, and the exercise price on outstanding warrants entitling Finova to purchase 400,000 shares of Altris common stock was also adjusted from $6.00 to $1.90 per share.
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Other terms of the transaction include:
-- Spescom will have the right to appoint one representative to the
Altris board;
-- An additional 1,000,000 shares will be issued to Spescom if court
approval of the settlement of Altris' outstanding securities
litigation is not received, as anticipated, by September 30, 1999;
-- Altris will apply $200,000 of the proceeds from the transaction
to fund an escrow account which will remain in effect until the
second anniversary of the closing date for the purpose of
securing any obligations owed by Altris to Spescom under the
agreement, including any liability Altris may have under its
representations and warranties to Spescom in the agreement;
-- The shares of stock representing Altris' 40% interest in ASL will
be pledged to Spescom to secure the obligations of Altris to
Spescom, such pledge not to extend beyond the second anniversary
of the closing date.
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In other news, the Company announced that it anticipates reporting its results for the first quarter ended March 31, 1999 and filing the related Quarterly Report on Form 10Q on Monday May 17th. Preliminary results for the three months ended March 31, 1999 indicate revenues of approximately $2.4 million and a net loss of approximately $2.4 million or 26 cents per share.
In the prior year the Company reported revenues for the three months ended March 31, 1998 of $3.0 million and a net loss of $2.8 million or 30 cents per share. The final results for the three months ended March 31, 1999 may differ from the preliminary data announced today.
Based in San Diego, Altris Software delivers enterprise-wide document management software to its customers around the world.
Spescom is one of the foremost communications and information technology companies in South Africa. It is listed the Johannesburg Stock Exchange. Spescom employs more than 200 software engineers in the fields of knowledge-management and digital voice processing. Spescom develops its own technology and is also engaged in alliances with several of the world's top corporations in its field.
Safe Harbor Statement
Except for historical information contained herein, the matters set forth in this release include forward-looking statements that are dependent on certain risks and uncertainties, including such factors, among others, as market acceptance, market demand, pricing, changing regulatory environment, the effect of the company's accounting policies, potential seasonality and other risk factors detailed in the company's SEC filings.
Note to editors: Altris EB is a registered trademark of Altris Software Inc. All other named products mentioned in this release may have been identified by trademarks or registered trademarks of their respective holders.
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CONTACT:
Altris Software, Inc.
John Low, 619/625-3000
or
Lippert/Heilshorn & Associates
Lillian Armstrong/Kris Otridge, 415/433-3777 |
