here are the facts:
Investor FAQ
Proposed Acquisition of Livewire Mobile’s Business Assets and Certain Liabilities by OnMobile Global, Ltd.
(1) Why did Livewire Mobile agree to sell its business to OnMobile?
Livewire Mobile is incredibly excited to become part of OnMobile to create the world’s leading carrier-VAS company. Upon evaluation of several strategic alternatives made possible by our recent revenue growth, our Board concluded that this transaction was the best path to maximizing value for our shareholders and for our customers.
OnMobile is a well-respected leader in delivering value-added services to mobile operators around the world with a very complementary suite of mobile services and geographical footprint to ours. Livewire Mobile’s customers will be well-served not only by the one-stop access to additional mobile entertainment services, but also by OnMobile’s dedication to quality and innovation and their substantial development resources.
The combination of Livewire and OnMobile Global will provide extended reach, coverage, technology framework, and innovation and together, OnMobile and Livewire Mobile will have a market reach of almost 2 billion end-consumers generating over $1.5 billion (USD) of top-line revenues for carriers around the globe.
(2) What is being sold to OnMobile? What is the purchase price?
Livewire is selling its business assets and OnMobile is assuming certain liabilities of Livewire Mobile for cash consideration of USD $17.8 million, subject to certain escrow and performance contingencies. Livewire Mobile is not selling its shares.
(3) What happens to my shares?
This transaction is a sale of the Company’s assets and assumption of certain liabilities for cash. Thus, existing outstanding shares will continue to be outstanding.
(4) Your press release stated that it is the Company’s expectation that the holders of senior secured convertible notes will convert a majority of their notes and vote the converted shares in favor of this transaction, which could amount to approximately 80% of the then fully-diluted outstanding shares. What does this mean?
The Company currently has 4,651,433 common shares outstanding. Additionally, Livewire Mobile has outstanding $6.615 million of senior secured convertible notes, plus additional amounts in accumulated interest that is convertible. The Company expects that the note holders will convert a majority of their notes into common stock of the Company. If the full value of notes and accumulated interest is converted, this could result in an additional increase of outstanding shares of approximately 20 million, and could be higher depending on the timing of the closing of the transaction. The note holders also hold warrants to purchase an additional 1,032,035 common shares.
(5) When does the Company expect the transaction to close?
The transaction is targeted to close on June 30, 2013 upon satisfaction of various customary closing conditions.
(6) Upon closing, what does the Company intend to do with the proceeds of the transaction?
The Company has not yet made a determination of what it will do with net proceeds of the transaction. Upon any determination, the Company will communicate to shareholders at that time.
Forward Looking Statements
Statements other than historical facts included or referred to in this FAQ are “forward-looking statements” including forward-looking statements about the expected closing date of the transaction and the conversion of senior secured convertible notes and favorable vote by holders of these notes. These statements are based on management’s expectations as of the date of this document and are subject to uncertainties and changes in circumstances. Actual results may differ materially from these expectations due to risks and uncertainties including, but not limited to, uncertainties with respect to the anticipated closing date of the transaction and conversion of senior secured convertible notes and favorable vote by holders of these. In addition, while management may elect to update forward-looking statements at some point in the future, management specifically disclaims any obligation to do so, even if its estimates change. Any reference to our website in this press release is not intended to incorporate the contents thereof into this FAQ, press release or any other public announcement
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