Crossword Cybersecurity Regulatory News (CCS)

15 Aug 2008 07:00



CCS.L

Clarity Commerce Solutions plc

(AIM: CCS, 'Clarity' or the 'Company'),

Clarity specialises in the delivery of mission-criticaltransaction processing solutions

for the retail, leisure, ticketing and hospitalitysectors.

MATRA performing strongly - earn-out terms agreed

The Board of Clarity Commerce Solutions plc ispleased to announce that it has reachedagreement in respect of deferred earn-out consideration payable in connection withthe agreement entered into between A Houldsworth, A Jacobs and Others (the "Vendors") (1) and the Company (2)dated 28 March 2006 (the "Agreement")relating to the acquisition of MATRA Systems (Holdings) Limited ("MATRA'"), a global software and solutions providerto the retail sector.

Under the terms ofthe Agreement, the Vendors received £2.5 million in cash on completion of the Agreement and a further sum of £500,000 which was satisfied by the issue of 757,576 ordinary shares in theCompany to Mr A Houldsworth and Mr A Jacobs. In addition,a further payment was possible depending on certain performancecriteria being met. This paymentwould be calculated by reference to a formula. Although the value of this paymentwould be unknown, the maximum amount payable by the Company, as calculated by theformula, would never exceed £8m. 

The Vendors and the Company have reached agreement(which is conditional amongst other things on the passing of resolutions by the shareholdersat the Company's next AGM necessary to implement the transactions detailed at paragraphs(a) and (b) below) in relation to the achievement of the relevant performance criteriawhereby the aggregate deferred consideration payable to the Vendors shall be £4,566,000, whichhas been or will be satisfied by:

(a) the allotmentand issue to the Vendors at any time prior to 30 September 2009 of such number of ordinary shares 0.25 each as are valued at £1,783,000 at the relevant time (the "Earn Out Shares"); and

(b) the issueby the Company to each Vendor of the unsecured Loan Notes to a total aggregate value of £2,283,000 (the "Loan Notes"); and

(c) the issue and allotment to Mr A Houldsworth and Mr A Jacobs (for andon behalf of the Vendors) of afurther 757,576 ordinary shares whichtook place on 21 August 2006.

The Company may, at its discretion, reduce thenumber of Earn Out Shares to be issued to the Vendors by adding the value of theEarn Out Shares not so issued to the aggregate value of Loan Notes to be issued tothe Vendors. The Company has the ability to suspend the issue of the Loan Notes if,in the reasonable opinion of the Board,the Company does not have sufficient working capital to do so.

MATRA has delivered an exceptionally strongperformance to date highlighting its ability to win large orders across multipleretail verticals which include grocery, amusement parks and general merchandise.Recent significant contract wins include BBA Dutch Waterways, Universal Studios Florida,Co-op Denmark as well as Movie Park, Germany.

As well as being Vendors, AnthonyHouldsworth, Simon Towner and Andrew Jacobs remain directors of MATRA, a wholly ownedsubsidiary of Clarity. This transaction is deemed therefore, for the purposes ofthe AIM Rules, to be one with a related party. In accordance with the AIM Rules forCompanies, the Directors of Clarity consider, having consulted with the Company'sNominated Adviser, that the terms of the transaction are fair and reasonable insofaras the Company's shareholders are concerned.

Ken Smith, Clarity's CEO commented:-

"I am delighted that we have now finalisedterms with regards to the acquisition of MATRA. It represents our core retail divisionand has delivered solid growth to date with the potential to accelerate this momentumin the years ahead as recent contract wins demonstrate. 

Our new management team has now restructuredthe Group, disposed of non core operations and dramatically turned the business aroundfrom reporting £1.1m of losses at interims to reporting a small adjusted loss before tax of £74,000 for the full year as recently announced. 

Our business is now streamlined and refocusedon our core markets, which has delivered significant successes to date. We are nowalso capable of quickly entering new markets as the BBA Dutch Contract demonstratessince our software can be easily adapted and modularised. Significant opportunitiesexist for the Group over the longer term and I look forward to reporting furtherprogress in due course."

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