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Ixchange Technology Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1997/009928/06)
("Ixchange")
Buy back of 16,8% of the issued share capital of
FrontRange Solutions Incorporated and
withdrawal of cautionary announcement.
INTRODUCTION
Further to the cautionary announcement published on 30 March 2001, Nedcor
Investment Bank Limited is authorised to announce that an agreement has been
reached between FrontRange Solutions Incorporated ("FrontRange") and certain
minority shareholders of FrontRange, whereby FrontRange will acqurie their
shares at US$2 per share
("the buy back").
2. EFFECT AND BENEFITS OF THE BUY BACK
As prospects and opportunities continue to remain positive for FrontRange, the
buy back allows Ixchange to increase its stake to an effective 85% of
FrontRange at a value of US$2 per FrontRange share.
Should the buy back payment have been made on 31 March 2001 FrontRange would
have had a net positive cash position of approximately US$31 million post
settlement.
The repurchase consideration of US$2 per share is at a value equal to the
current investment cost per share of Ixchange in FrontRange.
3. DETAILS OF THE BUY BACK
3.1 Background
FrontRange acquired GoldMine Software Corporation ("GoldMine") in terms of an
agreement entered into on
4 May 1999 ("the acquisition agreement"). In terms of the acquisition agreement
certain GoldMine vendors had the right to require either Ixchange or FrontRange
to purchase their shares held in FrontRange at a negotiated purchase price
should FrontRange fail to consummate an Initial Public Offering on or before
31 December 2000 ("the put option"). The put option (which was due to expire on
31 March 2001) was duly exercised by the GoldMine vendors.
3.2 Shares repurchased
Further to the negotiations regarding the exercise of the put option,
FrontRange has agreed to repurchase approximately 8 813 843 issued shares from
The Susser Management Trust, the Ferrara Living Trust, Michael Carter, Diana
Carter and Stephen Kidwell ("GoldMine vendors"), as well as 717 562 shares
subject to certain stock options held by original employees of GoldMine which
are also subject to the put option for a total of 9 531 405 shares being
repurchased.
3.3 Pricing of the buy back
The buy back price is US$2 per share. As a requirement of the GoldMine vendors
a higher consideration will become payable should there be a sale of FrontRange
shares to any third party in excess of US$2 per share prior to 1 November 2001
("a FrontRange transaction"), in which case the third party will purchase the
GoldMine vendors' shares directly at the same price paid to Ixchange. To this
extent it is not currently anticipated that Ixchange or FrontRange will enter
into such a transaction.
3.4 Buy back date
The payment date of the buy back shall be the earlier of 5 November 2001 or in
the event of a FrontRange transaction, five business days after the effective
date of the FrontRange transaction.
The GoldMine vendors may accelerate the buy back date to 8 June 2001 by an
election thereof on or before
1 June 2001 at US$2 per share.
4. FINANCIAL EFFECTS OF THE BUY BACK
The financial effects of the buy back on Ixchange are based on the assumption
that the buyback had been entered into on 1 July 2000 by FrontRange and would
have had the following effect on Ixchange's results for the six months ended 31
December 2000 and net asset value at 31 December 2000.
Before the After the Percentage
buy back buy back change
(cents) (cents)
Headline (loss)/earnings per share (66,46) (80,39) 21,0
(Loss)/earnings per share (94,39) (108,32) 14,8
Net tangible asset value per share 349,92 314 95 (10,0)
5. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
Ixchange shareholders are no longer required to exercise caution when dealing
in their Ixchange shares.
Johannesburg
24 April 2001
Investment bank and sponsor
NEDCOR
INVESTMENT BANK
Corporate law advisers
and consultants
EDWARD NATHAN & FRIEDLAND (PTY) LTD
(Registration number 1999/026464/07)
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