Polycom (PLCM) Enters Settlement with MDH, Sun Capital

October 23, 2012 5:00 PM EDT
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On May 11, 2012, Polycom, Inc. (Nasdaq: PLCM) announced that on May 10, 2012 it had entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with Mobile Devices Holdings, LLC (“MDH”), a Delaware limited liability corporation, pursuant to which the Company will divest its enterprise wireless voice solutions business (“EWS Business”) to an affiliate of Sun Capital Partners, Inc.

On August 21, 2012, Polycom filed a lawsuit to enforce the terms of the Purchase Agreement.

On October 22, 2012, Polycom entered into a settlement agreement with MDH and Sun Capital Partners V, L.P. to settle the claims raised in such lawsuit and, in connection with such settlement, amended the Purchase Agreement. Pursuant to the terms of the amendment, the consideration set forth in the Purchase Agreement shall consist of $110 million as follows: approximately $53 million in cash, subject to adjustments for cash, debt and working capital as set forth in the Purchase Agreement, plus up to an additional $57 million in cash over the next four years subject to certain conditions, including meeting certain agreed-upon EBITDA-based milestones.

The transaction is currently intended to close on or before December 15, 2012, subject to the terms of the Purchase Agreement.

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