XML 41 R24.htm IDEA: XBRL DOCUMENT v2.4.0.6
Subsequent Events
6 Months Ended
Jun. 30, 2012
Subsequent Events [Abstract]  
Subsequent Events
Subsequent Event

On August 1, 2012 the Company entered into a Share Purchase Agreement with IJ Next, an acquisition vehicle for Holding Baelen Gaillard of Paris, France, to purchase all of the shares of Pedrena Enterprises B.V. (“Pedrena”) held by the Company. Pedrena is the parent company of Interdata, the Company's Network Integration subsidiary in France.  The terms of the agreement include payment of 14.6 million euros 18.1 million USD) in cash. As of June 30, 2012, Pedrena had consolidated net cash (cash on hand, less negotiated liabilities) totaling 1.0 million euros (1.2 million USD). The transaction is conditioned upon the Company receiving stockholder approval for the transaction, the termination of certain contracts between Interdata/J3TEL and the Company and its subsidiaries and the adoption of a new contract between Interdata/J3TEL and the Company's subsidiary, MRV Communications - Boston Division, Inc., and Interdata and J3TEL meeting certain revenue, margin and booking percentages (unless such conditions are waived). The closing is expected to occur by the end of October 2012. In addition, the Company and IJ Next entered into a Representations and Warranties Agreement on August 1, 2012 (the “Representation and Warranties Agreement”) related to the transaction. The Representations and Warranties Agreement contains customary representations, warranties and covenants, as well as customary indemnification obligations. In addition, the Representation and Warranties Agreement contains an arrangement whereby if the Company does not obtain a representations and warranties insurance policy within 90 days of close of the transaction, and if the Company's cash falls below 20 million USD prior to December 31, 2013, the Company will deposit 1.5 million euros (or U.S. equivalent) in an escrow account to secure its indemnification obligations under the Representations and Warranties Agreement. The Company filed a preliminary proxy statement requesting stockholder approval of this transaction on August 8, 2012. 

In addition, on July 20, 2012 the Company entered into a Letter of Intent to sell 100 percent of the outstanding shares of Alcadon, its network integration subsidiary in Sweden to Deltaco AB (publ) (“Deltaco”) of Stockholm, Sweden that is non-binding except to its exclusivity and other miscellaneous provisions.  The terms of the agreement include payment of approximately $8.5 million plus net cash, which is approximately $2.0 million as of June 30, 2012. The stock purchase agreement is expected to contain customary terms, conditions, representations, warranties and covenants for an acquisition of this nature, including customary indemnification provisions. It is expected that the purchase agreement will contain limited representations relating to the operations of Alcadon. It is further expected that 10% of the purchase price will be placed in escrow at closing which escrow would be released to MRV (subject to any pending claims thereon) no later than December 31, 2012. The Company filed a preliminary proxy statement requesting stockholder approval of this transaction on August 9, 2012.