EXHIBIT 99.1
[OLICOM LOGO]
OFFER TO PURCHASE
ALL COMMON SHARES HELD
BY HOLDERS OF 1,000 OR FEWER SHARES
FOR US$1.10 PER SHARE IN CASH
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THE OFFER WILL EXPIRE
ON JUNE 19, 2002 AT 5:00 P.M. NEW YORK CITY TIME,
UNLESS THE OFFER IS EXTENDED
---------
May 21, 2002
Olicom A/S, a corporation organized under the laws of the Kingdom of
Denmark ("Olicom"), hereby offers to purchase all common shares, nominal value
DKK 0.25 per share ("Shares"), held by a shareholder who holds 1,000 or fewer
Shares, of record or beneficially, which are tendered in response to Olicom's
offer, for a price of US$1.10 per Share, all upon the terms and subject to the
conditions set forth in this Offer to Purchase and the related Letter of
Transmittal (the "Offer").
Olicom has retained MacKenzie Partners, Inc. (the "Information Agent"),
to provide further information and assistance in connection with the Offer. If a
shareholder desires such information or assistance, or additional copies of the
enclosed materials, please call or write the Information Agent at the following
address:
[MACKENZIE PARTNERS LOGO]
105 Madison Avenue
New York, New York 10016
(212) 929-5500 (Call Collect)
Email: proxy@mackenziepartners.com
or
CALL TOLL-FREE (800) 322-2885
THE OFFER IS NOT BEING MADE TO ANY SHAREHOLDER OF OLICOM WHO HOLDS MORE
THAN 1,000 SHARES, OF RECORD OR BENEFICIALLY.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION, AND YOU SHOULD CAREFULLY READ BOTH IN THEIR ENTIRETY
BEFORE YOU MAKE A DECISION WITH RESPECT TO THE OFFER.
EXPIRATION OF THE OFFER
The Offer will expire at, and all certificates evidencing Shares to be
tendered must be received by Olicom's transfer agent, American Stock Transfer &
Trust Company (the "Depositary"), in proper form by 5:00 p.m., New York City
time, on June 19, 2002, or if the Offer is extended, by the time and date
specified in such extension. The final expiration date and time of the Offer,
whether or not extended, is referred to herein as the "Expiration Time."
Olicom reserves the right to extend or amend the Offer at any time and
from time to time, and to terminate the Offer at any time. Notice of any such
extension, amendment and/or termination will be promptly sent to the Depositary
and made by public announcement.
HOW TO ACCEPT THE OFFER
If a shareholder desires to accept the Offer and tender Shares, the
following summarizes the procedures that must be undertaken (see, generally,
"Procedure for Tendering Shares"):
o As to shareholders who are record holders (which means that a
stock certificate has been issued in such shareholder's name),
the enclosed Letter of Transmittal and Form W-9 should be
completed, signed and mailed in the enclosed reply envelope,
together with stock certificates for all Shares held of
record. These materials must reach the Depositary before the
Expiration Time.
o If Shares are held in street name by a shareholder's broker or
other nominee, a letter from that broker or other nominee is
enclosed. Shareholders who hold Shares in street name who wish
to accept the Offer should request their broker or other
nominee to effect the transaction by signing the acceptance
included with such letter and promptly returning it to their
broker or other nominee.
o As to a shareholder who is a record holder, but as to whom
such shareholder's stock certificate is not available or as to
which such stock certificate cannot be delivered before the
Expiration Time, Shares may still be able to be tendered. See
"Procedure for Tendering Shares -- Guaranteed Delivery."
A SHAREHOLDER ELIGIBLE TO PARTICIPATE IN THE OFFER MUST TENDER ALL
SHARES OWNED ON SUCH DATE; PARTIAL TENDERS WILL NOT BE ACCEPTED.
SUMMARY OF PURPOSES OF THE OFFER
The purposes of the Offer are (i) to enable holders of 1,000 or fewer
Shares to dispose of such Shares without incurring brokerage commissions and
(ii) to reduce the number of shareholders of Olicom resident in the United
States. At such time as the number of holders of Shares resident in the United
States decreases to less than 300, Olicom anticipates that it will terminate the
registration of the Shares under United States securities laws. See "Purposes of
the Offer."
ACCEPTANCE FOR PAYMENT AND PAYMENT OF THE PURCHASE PRICE
For purposes of the Offer, Olicom will be deemed to have accepted for
payment tendered Shares when, as and if it gives oral or written notice of its
acceptance to the Depositary. Olicom will pay for Shares accepted for payment
pursuant to the Offer by depositing the purchase price therefor with the
Depositary. The Depositary will act as agent for each tendering shareholder for
the purpose of receiving payments from Olicom and transmitting such payments to
such tendering shareholder. In all cases, payment for Shares accepted for
payment pursuant to the Offer will be made only after timely receipt by the
Depositary of certificates for such Shares (or of a confirmation of a book-entry
transfer of such Shares into the Depositary's account at the Book-Entry Transfer
Facility (as defined below)), a properly completed and duly executed Letter of
Transmittal and any other required documents. Accordingly, payment may be made
to tendering shareholders at different times if delivery of Shares and other
required documents occurs at different times. For a description of the procedure
for tendering Shares pursuant to the Offer, see "Procedure for Tendering
Shares."
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UNDER NO CIRCUMSTANCES WILL OLICOM PAY INTEREST ON THE CONSIDERATION
PAID FOR SHARES PURSUANT TO THE OFFER, REGARDLESS OF ANY DELAY IN MAKING SUCH
PAYMENT.
If any tendered Shares are not purchased pursuant to the Offer for any
reason, certificates for such unpurchased Shares will be returned (or, in the
case of Shares tendered by book-entry transfer, such Shares will be credited to
an account maintained at the Book-Entry Transfer Facility), without expense to
the tendering shareholder, as promptly as practicable following the expiration
or termination of the Offer.
Olicom reserves the right to transfer or assign, in whole or from time
to time in part, to one or more of its affiliates the right to purchase Shares
tendered pursuant to the Offer, but any such transfer or assignment will not
relieve Olicom of its obligations under the Offer or prejudice a shareholder's
right to receive payment for Shares validly tendered and accepted for payment.
BENEFITS TO TENDERING SHAREHOLDERS
Shareholders who hold their Shares of record will not be obligated to
pay brokerage fees, commissions or, except as set forth in Instruction 6 of the
Letter of Transmittal, transfer taxes on the sale of Shares pursuant to the
Offer. If a shareholder owns Shares through a broker or other nominee, and such
broker or other nominee tenders Shares on behalf of the shareholder, such broker
or nominee may charge the shareholder a fee for doing so. Shareholders should
consult their broker or nominee to determine whether any charges will apply.
Olicom will pay all charges and expenses of the Depositary and the Information
Agent incurred in connection with the Offer.
EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES; REGISTRATION UNDER THE
EXCHANGE ACT.
The Shares are currently registered under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"). Such registration may be terminated
upon application by Olicom to the Securities and Exchange Commission (the
"Commission") if the Shares are not listed on a "national securities exchange"
and there are fewer than 300 holders of Shares resident in the United States. As
discussed more fully under the caption "Purposes of the Offer," Olicom intends
to deregister the Shares under the Exchange Act. The deregistration of the
Shares will result in such shares ceasing to be quoted on the OTC Bulletin
Board. As a consequence, the trading market for the Shares in the United States
will probably become more illiquid. The Offer provides shareholders with an
opportunity to receive a cash payment for their Shares (without incurring
brokerage commissions), and avoid the relative illiquidity with respect to the
Shares in the United States that will probably exist subsequent to their
deregistration.
The deregistration of the Shares under the Exchange Act would terminate
Olicom's obligations to provide certain information to holders of Shares and to
the Commission, and would make certain provisions of the Exchange Act no longer
applicable to the Shares. In addition, upon deregistration of the Shares,
"affiliates" of Olicom and persons holding "restricted securities" of Olicom may
be deprived of the ability to dispose of such securities pursuant to Rule 144
under the Securities Act of 1933, as amended.
SHARES COVERED BY THE OFFER
The Offer is being made only to holders of Shares who hold 1,000 or
fewer Shares, of record or beneficially. The Offer is to purchase all, but not
less than all, Shares held by such shareholders. The Offer is not subject to a
minimum number of Shares being tendered. Olicom expects to pay for Shares
purchased with cash on hand. The Offer is not subject to any financing
condition.
PROCEDURE FOR TENDERING SHARES
In General. To tender Shares pursuant to the Offer:
o The Depositary must receive at its address set forth on the
back cover of this Offer to Purchase a Letter of Transmittal
(or a facsimile thereof) properly completed and duly executed,
and any other documents required by the Letter of Transmittal,
and certificates for the Shares to be tendered, prior to the
Expiration Time; or
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o Such Shares must be delivered pursuant to the procedures for
book-entry transfer described below (and a confirmation of
such delivery including an Agent's Message (as defined below)
if the tendering shareholder has not delivered a Letter of
Transmittal), prior to the Expiration Time; or
o The guaranteed delivery procedure described below must be
complied with.
Book-Entry Delivery. The Depositary will establish an account with
respect to the Shares at The Depository Trust Company (the "Book-Entry Transfer
Facility") for purposes of the Offer within two business days after the date of
this Offer to Purchase, and any financial institution that is a participant in
the system of the Book-Entry Transfer Facility may make delivery of Shares by
causing the Book-Entry Transfer Facility to transfer such Shares into the
Depositary's account in accordance with the procedures of the Book-Entry
Transfer Facility. However, although delivery of Shares may be effected through
book-entry transfer, either the Letter of Transmittal (or a facsimile thereof),
properly completed and duly executed, together with any required signature
guarantees or an Agent's Message in lieu of the Letter of Transmittal and any
other required documents, must, in any case, be received by the Depositary at
its address set forth on the back cover of this Offer to Purchase by the
Expiration Time, or the guaranteed delivery procedure described below must be
complied with. Delivery of the Letter of Transmittal and any other required
documents to the Book-Entry Transfer Facility does not constitute delivery to
the Depositary. "Agent's Message" means a message transmitted by the Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
book-entry confirmation which states that the Book-Entry Transfer Facility has
received an express acknowledgment from the participant in the Book-Entry
Transfer Facility tendering the Shares that are the subject of such book-entry
confirmation which such participant has received, and agrees to be bound by, the
terms of the Letter of Transmittal and that Olicom may enforce such agreement
against such participant.
Signature Guarantees. Except as otherwise provided below, all
signatures on a Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) that is a member of a recognized Medallion Program approved by the
Securities Transfer Association, Inc. (each, an "Eligible Institution").
Signatures on a Letter of Transmittal need not be guaranteed (i) if the Letter
of Transmittal is signed by the registered holder of the Shares tendered
therewith and such holder has not completed the box captioned "Special Payment
Instructions" on the Letter of Transmittal, or (ii) if such Shares are tendered
for the account of an Eligible Institution. See Instructions 1 and 5 of the
Letter of Transmittal.
Guaranteed Delivery. If a shareholder wishes to tender Shares pursuant
to the Offer and cannot deliver certificates therefor and all other required
documents to the Depositary by the Expiration Time, or cannot complete the
procedure for delivery by book-entry transfer on a timely basis, such
shareholder may nevertheless tender such Shares if all of the following
conditions are met:
o Such tender is made by or through an Eligible Institution;
o A properly completed and duly executed Notice of Guaranteed
Delivery in the form provided by Olicom is received by the
Depositary (as provided below) by the Expiration Time; and
o The Share certificates (or a confirmation of a book-entry
transfer into the Depositary's account at the Book-Entry
Transfer Facility), together with a Letter of Transmittal (or
facsimile thereof), properly completed and duly executed, with
any required signature guarantee or an Agent's Message and any
other documents required by the Letter of Transmittal, are
received by the Depositary within three Nasdaq National Market
trading days after the date of execution of the Notice of
Guaranteed Delivery.
Back-up Withholding. Under the federal income tax laws, the Depositary
will be required to withhold a portion of the amount of any payments made to
certain shareholders pursuant to the Offer. In order to avoid such back-up
withholding, a tendering shareholder must provide the Depositary with a correct
taxpayer identification number ("TIN") and certify that such shareholder is not
subject to such back-up withholding by completing the Substitute Form W-9
included in the Letter of Transmittal. Certain shareholders (including, among
others, all corporations and certain foreign individuals and entities) are not
subject to back-up withholding. If a shareholder does not provide its correct
TIN or fails to provide the certifications described above, the Internal Revenue
Service
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may impose a penalty on the shareholder and payment of cash to the shareholder
pursuant to the Offer may be subject to back-up withholding. All shareholders
tendering Shares pursuant to the Offer should complete and sign the Substitute
Form W-9 included in the Letter of Transmittal to provide the information
necessary to avoid back-up withholding. If a tendering shareholder is a
non-resident alien or foreign entity not subject to back-up withholding, such
shareholder must give the Depositary a properly completed Form W-8BEN
Certificate of Foreign Status or successor form in order to avoid backup
withholding with respect to payments made to such shareholder.
Grant of Proxy. By executing a Letter of Transmittal (or delivering an
Agent's Message), a tendering shareholder will irrevocably appoint Jorgen Hog
and Lawrence D. Ginsburg, and any other designees of Olicom, as such
shareholder's proxies in the manner set forth in the Letter of Transmittal to
the full extent of his, her or its rights with respect to the Shares tendered
and accepted for payment by Olicom (and any and all other Shares or other
securities issued or issuable in respect of such Shares on or after the date of
this Offer to Purchase). All such proxies are irrevocable and coupled with an
interest in the tendered Shares. Such appointment is effective only upon
Olicom's acceptance for payment of such Shares. Upon such acceptance for
payment, all prior proxies and consents granted by such tendering shareholder
with respect to such Shares and other securities will, without further action,
be revoked, and no subsequent proxies may be given nor subsequent written
consents executed (and, if previously given or executed, will cease to be
effective). Olicom's designees will be empowered to exercise all voting and
other rights of a tendering shareholder as such proxies, in their sole
discretion, may deem proper at any annual, extraordinary or adjourned meeting of
Olicom's shareholders, by written consent or otherwise. Olicom reserves the
right to require that, in order for Shares to be validly tendered, immediately
upon Olicom's acceptance for payment of such Shares, Olicom be able to exercise
full voting rights with respect to such Shares and other securities (including
voting at any meeting of shareholders then scheduled or acting by written
consent without a meeting).
The foregoing proxies are effective only upon acceptance for payment of
Shares pursuant to the Offer. The Offer does not constitute a solicitation of
proxies, absent a purchase of Shares, for any meeting of Olicom's shareholders,
which will be made only pursuant to separate proxy solicitation.
The tender of Shares pursuant to any one of the procedures described
above will constitute a tendering shareholder's acceptance of the Offer, as well
as his, her or its representation and warranty that such tendering shareholder
(i) owns the Shares being tendered, (ii) has the full power and authority to
tender, sell, assign and transfer the Shares tendered, as specified in the
Letter of Transmittal, (iii) is tendering all Shares held by such tendering
shareholder, of record and beneficially, (iv) owns of record or beneficially, a
total of not more than 1,000 Shares, and (v) upon the sale, assignment and
transfer of Shares tendered by such shareholder, Olicom will acquire good title
thereto, free and clear of all liens, charges, encumbrances, conditional sales
agreements or other obligations relating to the sale or transfer thereof, and
not subject to any adverse claim or right. Olicom's acceptance for payment of
Shares tendered pursuant to the Offer will constitute a binding agreement
between Olicom and such tendering shareholder with respect to such Shares, upon
the terms and subject to the conditions of the Offer.
PLEASE FOLLOW THE TRANSMITTAL INSTRUCTIONS CAREFULLY. THE METHOD OF
DELIVERY OF ALL SHARE CERTIFICATES AND OTHER DOCUMENTS (INCLUDING NOTICE OF
GUARANTEED DELIVERY AND DELIVERY THROUGH THE BOOK-ENTRY TRANSFER FACILITY) IS AT
THE ELECTION AND RISK OF THE SHAREHOLDER, AND DELIVERY WILL BE DEEMED MADE ONLY
WHEN ACTUALLY RECEIVED BY THE DEPOSITARY, INCLUDING, IN THE CASE OF A BOOK-ENTRY
TRANSFER, BY AGENT'S MESSAGE. IF DELIVERY IS BY MAIL, REGISTERED MAIL, RETURN
RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED FOR SAFETY. IN ALL CASES,
SUFFICIENT TIME SHOULD BE ALLOWED FOR TIMELY DELIVERY.
All required documentation should be transmitted to the Depositary at
the following address:
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AMERICAN STOCK TRANSFER & TRUST COMPANY
By First Class Mail, Overnight Delivery or Hand/Overnight Delivery:
American Stock Transfer & Trust Company
59 Maiden Lane
New York, New York 10038
Facsimile Transmission Number (for Eligible Institutions Only):
(718) 234-5001
Confirm by Telephone:
(718) 921-8200
WITHDRAWAL RIGHTS
Shareholders may withdraw tenders of Shares made pursuant to the Offer
at any time prior to the Expiration Time. Thereafter, such tenders are
irrevocable and cannot be withdrawn without Olicom's approval, which may be
withheld in its absolute discretion. If Olicom extends the period of time during
which the Offer is open, is delayed in accepting for payment or paying for
Shares pursuant to the Offer for any reason, or is unable to accept Shares for
payment pursuant to the Offer for any reason, then, without prejudice to its
rights under the Offer, the Depositary may, on Olicom's behalf, retain all
Shares tendered, and such Shares may not be withdrawn except as otherwise
provided in this section.
To withdraw tendered Shares, a written or facsimile transmission notice
of withdrawal with respect to the Shares must be timely received by the
Depositary at its address set forth on the back cover of this Offer to Purchase,
and the notice of withdrawal must specify the name of the person who tendered
the Shares to be withdrawn and the number of Shares to be withdrawn and the name
of the registered holder of Shares, if different from that of the person who
tendered such Shares. If the Shares to be withdrawn have been delivered to the
Depositary, a signed notice of withdrawal with (except in the case of Shares
tendered by an Eligible Institution) signatures guaranteed by an Eligible
Institution must be submitted prior to the release of such Shares. In addition,
such notice must specify, in the case of Shares tendered by delivery of
certificates, the name of the registered holder (if different from that of the
tendering shareholder) and the serial numbers shown on the particular
certificates evidencing the Shares to be withdrawn or, in the case of Shares
tendered by book-entry transfer, the name and number of the account at the
Book-Entry Transfer Facility to be credited with the withdrawn Shares.
Withdrawals may not be rescinded, and Shares withdrawn will thereafter be deemed
not validly tendered for purposes of the Offer. However, withdrawn Shares may be
re-tendered by again following one of the procedures described in "Procedure for
Tendering Shares" at any time prior to the Expiration Time.
Olicom will determine, in its sole discretion, all questions as to the
form and validity (including time of receipt) of any notice of withdrawal, and
Olicom's determination shall be final and binding. None of Olicom, the
Depositary, the Information Agent or any other person will be under any duty to
give notification of any defect or irregularity in any notice of withdrawal or
waiver of any such defect or irregularity or incur any liability for failure to
give any such notification.
IMPROPER TENDERS
The Offer is being made only to shareholders of Olicom who hold,
directly or indirectly, 1,000 or fewer Shares. Tenders by shareholders who hold,
directly or indirectly, more than 1,000 Shares will not be accepted by Olicom.
VALIDITY OF TENDERS
All questions as to the form of documents and the validity, form,
eligibility (including, without limitation, time of receipt) and acceptance for
payment of any tender of Shares will be determined by Olicom, in its sole
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discretion, which determination will be final and binding on all parties. Olicom
reserves the absolute right to reject any and all tenders of Shares determined
by it not to be in proper form or the acceptance for payment of which may, in
the opinion of its counsel, be unlawful. Olicom also reserves the absolute right
to waive any of the conditions of the Offer to the extent permitted by
applicable law or any defect or irregularity in the tender of any Shares of any
particular shareholder, whether or not similar defects or irregularities are
waived in the case of other shareholders. No tender of Shares will be deemed to
have been validly made until all defects and irregularities have been cured or
waived. None of Olicom or any of its affiliates or assigns, the Depositary, the
Information Agent or any other person will be under any duty to give
notification of any defects or irregularities in tenders or waiver of any such
defect or irregularity or incur any liability for failure to give any such
notification. Olicom's interpretation of the terms and conditions of the Offer
will be final and binding on all parties.
PURPOSES OF THE OFFER
Since November 1997, the Shares have traded on the Copenhagen Stock
Exchange ("CSE"). Following the delisting of the Shares from the Nasdaq National
Market in April 2000, the percentage of Shares held by shareholders with
addresses in the United States has declined dramatically. Based on recent
information as to record and beneficial holders, Olicom believes that at least
90% of its outstanding Shares are held by shareholders who are not resident in
the United States.
In connection with the foregoing, the Board of Directors of Olicom (the
"Board") has determined that it is no longer in Olicom's best interests to
continue the registration of the Shares under the Exchange Act. In making such a
determination, the Board considered several factors, the most important of which
were the following: (i) the CSE has become the principal market on which the
Shares are traded; (ii) approximately 90% of the outstanding Shares are
currently deposited in accounts at the Danish Securities Centre
(Vaerdipapircentralen) ("DSC"), so as to facilitate the trading thereof on the
CSE, or are deposited elsewhere outside of the United States; and (iii) the
significant expense attendant to maintaining registration of the Shares under
the Exchange Act and complying with the reporting obligations thereunder, in
view of the number of shareholders who are resident in the United States and the
level of trading activity for the Shares in the United States. This Offer is
being undertaken pursuant to the exemption for cross-border tender offers
provided in Rule 13e-4(h)(8) under the Exchange Act.
A primary purpose of the Offer is to purchase Shares from a sufficient
number of shareholders so that the number of holders of Shares resident in the
United States decreases to less than 300. At such time as the number of holders
of Shares resident in the United States decreases to less than 300, Olicom
anticipates terminating the registration of the Shares under the Exchange Act.
The termination of the registration of the Shares under the Exchange Act will
result in the Shares ceasing to be quoted on the OTC Bulletin Board. See "Effect
of the Offer on the Market for the Shares; Registration under the Exchange Act."
Olicom anticipates maintaining the listing of the Shares on the CSE and
will continue to be subject to the reporting obligations of such exchange.
Simultaneously with the Offer, Olicom has undertaken actions and may undertake
other actions that may result in a decreased number of holders of Shares
resident in the United States. In particular, Olicom is undertaking actions to
facilitate the transfer of Shares held by shareholders not resident in the
United States to accounts at the DSC and elsewhere in Europe.
CERTAIN TAX CONSEQUENCES
The sale of Shares to Olicom pursuant to the Offer will be a taxable
transaction, and should generally result in gain or loss for federal income tax
purposes, as well as under applicable state, local and other tax laws.
Under federal income tax law, a non-exempt shareholder who receives a
cash payment from Olicom is required to provide a correct taxpayer
identification number. If a shareholder fails to provide such taxpayer
identification number, the shareholder may be subject to certain penalties and
30% backup withholding may be required to be deducted from any cash payment due
to the shareholder. See "Procedure for Tendering Shares -- Back-up Withholding."
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SHAREHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS AS TO THE SPECIFIC
TAX CONSEQUENCES TO THEM OF TENDERING INTO THE OFFER, INCLUDING THE
APPLICABILITY OF FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX LAWS.
CERTAIN INFORMATION ABOUT OLICOM
Information concerning Olicom, including the Group and Parent Company
Financial Statements of Olicom for the fiscal year ended December 31, 2001, are
available without charge upon written request addressed to Olicom A/S, Nybrovej
110, DK-2800 Kgs. Lyngby, Denmark, Attn: Shareholder Relations Department, or
Olicom A/S, 2200 Ross Avenue, Suite 2200, Dallas, Texas 75201-6776, Attn:
Shareholder Relations Department. Enclosed herewith is the Summary of Financial
Statements of Olicom for the fiscal year ended December 31, 2001, together with
its Financial Statements for the quarter ended March 31, 2002. Additional
information about Olicom is available from Olicom's filings with the Commission
by contacting Olicom directly. The Commission maintains a Web site that contains
reports and other information regarding registrants that file with
electronically with the Commission at http://www.sec.gov. Olicom is subject to
the informational requirements of the Exchange Act, and in connection therewith,
voluntarily files its reports electronically with the Commission. Information is
also available on Olicom's Web site at www.olicom.com.
In considering the Offer, shareholders should carefully judge for
themselves whether or not the acceptance of the Offer is best, and in
appropriate cases, a financial advisor should be consulted. Olicom has
determined the offer price of US$1.10 per share on the basis of the last sale
price for the Shares (US$0.85) as quoted on the OTC Bulletin Board on May 17,
2002. The offer price represents a 29% premium over the last sale price for the
Shares as quoted on the OTC Bulletin Board on May 17, 2002. The last sale price
for the Shares quoted by the CSE on May 17, 2002 was DKK 8.60, which converts
into US$1.06 based on the exchange rate of the Danish Central Bank for
converting Danish kroner into US dollars in effect on such date. The following
table reflects the highest and lowest sale prices for the Shares for each of the
last four completed quarters and the current quarter, as quoted by the OTC
Bulletin Board:
<Table>
<Caption>
QUARTER ENDED HIGHEST SALE PRICE LOWEST SALE PRICE
------------- ------------------ -----------------
06/30/01 US$1.00 US$1.30
09/30/01 0.90 1.15
12/31/01 0.85 1.00
03/31/02 0.85 1.25
06/30/02* 0.90 0.96
</Table>
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* Through May 17, 2002
The following table reflects the highest and lowest sale prices for the
Shares for each of the last four completed quarters and the current quarter, as
quoted by the CSE and converted into US dollars based on the exchange rate of
the Danish Central Bank for converting Danish kroner into US dollars on the
dates indicated for the highest and lowest sale prices:
<Table>
<Caption>
QUARTER ENDED HIGHEST SALE PRICE LOWEST SALE PRICE
------------- ------------------ -----------------
06/30/01 US$1.10 US$1.54
09/30/01 1.00 1.18
12/31/01 0.95 1.09
03/31/02 1.04 1.35
06/30/02* 0.89 1.04
</Table>
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* Through May 17, 2002
On May 17, 2002, the reported closing price of a Share on the OTC
Bulletin Board was US$0.85, and the reported closing price of a Share on the CSE
was DKK 8.60 (or US$1.06, based on the exchange rate of the Danish
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Central Bank for converting Danish kroner into US dollars in effect on such
date). Olicom urges shareholders to obtain current market quotations for the
Shares. Since its initial public offering in 1992, Olicom has not declared or
paid cash dividends on its capital stock.
MISCELLANEOUS
The Offer is not being made to, nor will Olicom accept tenders of
Shares from, shareholders in any jurisdiction in which the Offer or the
acceptance thereof would not be in compliance with the securities or other
applicable laws of such jurisdiction.
Olicom is not aware of any jurisdiction in which the making of the
Offer or the tender of Shares in connection therewith would not be in compliance
with the laws of such jurisdiction. To the extent that Olicom becomes aware of
the law of any jurisdiction that would limit the class of offerees in the Offer,
Olicom will amend the Offer and disseminate such information to holders of
Shares by public announcement prior to the expiration of the Offer.
If a shareholder requires assistance, or would like additional copies
of the Offer materials, please call or write to the Information Agent as set
forth on the back cover hereof.
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SUMMARY OF
THE FINANCIAL STATEMENTS FOR 2001
Below the main contents of the Financial Statements for the year ended
December 31, 2001, are rendered, followed by an overview of selected financial
data. The following should be read in conjunction with, and is qualified in its
entirety by Olicom's financial statements and the related notes thereto, which
are available at http://www.olicom.com in both a Danish and an English version.
o For 2001, Olicom's net result was a loss of DKK 10.4 million (USD 1.2
million). The result exclusive of the loss from affiliated companies
was a profit of DKK 32.7 million (USD 3.9 million) which compares to
the earlier announced expectation of a loss of approximately DKK 5
million (USD 0.6 million). The positive deviation was primarily caused
by the recognition of the previously announced claim for refund of
customs duty in the amount of DKK 29 million (USD 3.4 million). The
result from affiliated companies, which comprises Olicom's share in
the operating results thereof, amortization of goodwill and
write-downs, amounted to a loss of DKK 43 million (USD 5 million).
o Shareholders' equity at year-end was DKK 228 million (USD 27 million)
corresponding to DKK 13.10 (USD 1.56) per share outstanding at the end
of 2001.
o Olicom's cash position at the end of 2001 amounted to DKK 170 million
(USD 20 million). The outstanding booked customs duty refund of DKK 21
million (USD 2.5 million) is expected to be received during the first
quarter of 2002.
o During 2001, Olicom evaluated approximately 200 investment proposals
and made 6 investments, totaling DKK 56 million (USD 6.6 million). At
year-end, the Company's portfolio consisted of investments in 10
companies. At the end of 2001, Olicom entered into an agreement to
invest in Danacell. The investment closed at the beginning of 2002.
o Olicom's first portfolio company Juize A/S was sold to the English
public company RTS NetWorks PLC ("RTSe") in July 2001. The
consideration received by Olicom consisted of shares in RTSe, and as
part of the agreement Olicom further subscribed for additional new
shares in RTSe. Subsequently, RTSe experienced considerable financial
difficulties; as a result, Olicom determined to write off its
shareholding in RTSe during financial year 2001.
o In 2001, Olicom continued to fulfill the obligations the Company
assumed in connection with transactions implemented in 1999 with
respect to the divestiture of certain business activities (the "1999
Transactions") as well as other agreements relating to discontinued
business operations. The Company's restructuring has generally been
completed with lower costs than expected when the Company announced
its 2000 full year results. Accordingly, part of the provisions with
respect to the 1999 Transactions and subsequent restructuring has been
reversed.
o Olicom's discontinued production of equipment used in local area
networks was undertaken by contract manufacturers in Thailand, from
which the equipment was imported to Denmark. For this importation, the
Company paid customs duty in accordance with the rating specified by
Danish customs authorities. In 2001, the EU Court of Justice rendered
a judgment that directed that a lower rate of customs duty be utilized
with respect to the importation of the above-mentioned equipment than
the one applied by Olicom from 1996 to 1999. In this connection,
Olicom made a demand for a refund of excess customs duties paid from
1996 to 1999. On the basis of the available information from the
customs authorities, the Company has recorded DKK 29 million (USD 3.4
million) as income in the Financial Statements for 2001, representing
the expected refund, with the addition of interest through December
31, 2001. Of this amount, DKK 7.8 million (USD 0.9 million) was
received at the end of 2001.
o Overview of existing portfolio companies:
<Table>
<Caption>
DKK
NAME MILLION SHARE BUSINESS AREA
- ---- ------- ----- -------------
Sifira A/S 11.8 50% Develops unified messaging products, which are offered to
telephone companies.
Transynergy A/S 5.2 50% Develops software for technology platforms utilized on handheld
computers.
Vizion Factory 5.0 4.8% Develops e-learning products.
e-learning A/S
GoPinocchio ApS 3.62 8.2% System integrator for mobile solutions.
Interactive Television 10.0 50% Develops interactive TV concepts (especially known for the Hugo
Entertainment ApS character); supports the sale of games to PC, Sony PlayStation,
Nintendo Game Boy, etc.
Hymite ApS 9.0 16.9% Develops complete solutions for manufacturing and packaging
optical modules deployed within the high growth
telecommunications market.
LH Comlog A/S 6.3 14.5% Develops and markets fleet management systems; develops fleet
management software and a range of wireless data terminals based
on GSM and GSP.
Scalado AB 6.4 22.2% Develops patent-pending solutions for rendering and transferring
digital image information independent of communication
technology. Scalado's Image Zoom substantially minimizes the
amount of data sent from a web server.
Mobite A/S 8.2 17.2% Develops an enterprise software platform, TIMEngine(TM), together
with its American Partner Xtime, Inc. (which owns a substantial
shareholding in Mobite). The platform is a service automation
solution targeted at larger enterprises within the service industry.
Decuma AB 5.0 8.5% Develops and markets handwriting recognition software for
handheld devices like mobile phones, PDAs, PC Tablets and
digital pens.
Danacell A/S 0.9 6.0% Developed and patented a new type of polymer-membrane
electrolytes for use in rechargeable litium polymer and litium ion
batteries.
</Table>
o With a present portfolio of 11 companies, Olicom expects its efforts
to be concentrated on the continued development of its portfolio
companies. As a result, the Company's new investments in 2002 are
expected to be less than in 2001. Olicom therefore expects to be
making two to four investments in new portfolio companies in 2002.
These investments and additional investments in existing portfolio
companies are expected to be in the range of DKK 75 million (USD 9
million) in total.
o Olicom's existing portfolio companies are still primarily in the
establishment phase and are in total expected to record a negative
result in 2002. In the Company's opinion two or three portfolio
investments may be exited in late 2002. As a matter of caution,
however, such possible profits are not included in the expected result
for 2002. On the basis of these assumptions, the Company therefore
expects to report a net loss in the range of DKK 60 million (USD 7
million) for 2002. This is a consequence of the Company's accounting
policies, according to which the result is affected negatively by
Olicom's share in the affiliated companies' operating results and
amortization of goodwill.
2
SELECTED FINANCIAL DATA
During 2000, the Company's business activities underwent significant
change. Comparison figures for 1997 to 1999 cannot be adjusted to present a
comparable view of the Company's present activities and therefore have been
omitted.
KEY FIGURES (IN THOUSANDS DKK EXCEPT PER SHARE AMOUNTS):
<Table>
<Caption>
2000 2001
------- -------
CONSOLIDATED STATEMENTS OF INCOME
Income (loss) from portfolio companies .................. (3,635) (43,025)
Administrative expenses ................................. 24,569 17,249
INCOME (LOSS) FROM PRIMARY OPERATIONS ................... (28,204) (60,274)
Other operating income .................................. 175 810
Other operating expenses ................................ 198 796
Foreign currency gains (losses) ......................... 20,132 101
Other financial items, etc .............................. 5,817 6,820
INCOME (LOSS) BEFORE INCOME TAX ......................... (2,278) (53,339)
Income tax of net income ................................ 0 0
Income of discontinued business operations .............. 82,735 42,972
NET INCOME (LOSS) ....................................... 80,457 (10,367)
BALANCE SHEET DATA
Working capital ......................................... 221,204 181,410
Total assets ............................................ 307,244 270,598
Total shareholders' equity at end of year ............... 242,073 228,047
KEY FIGURES
Book value per share at end of year (DKK) ............... 13.90 13.10
Return on equity (%) .................................... 39.2 (5.2)
Earnings (loss) per share (DKK) ......................... 4.54 (0.60)
Weighted average shares outstanding ..................... 17,726 17,294
Number of employees at end of year ...................... 10 10
</Table>
- ----------
The foregoing key figures have been prepared in accordance with the Association
of Danish Financial Analysts' "Recommendations and Key Figures 1997" (Den Danske
Finansanalytikerforenings "Anbefalinger og Nogletal 1997") on the basis of the
Olicom Group's accounting policies.
SAFE HARBOR STATEMENT
This Summary contains statements that constitute "forward-looking
statements" within the meaning of Section 21E of the United States Securities
Exchange Act of 1934, as amended. The United States Private Securities
Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking
information to encourage companies to provide prospective information about
themselves without fear of litigation so long as the information is identified
as forward looking and is accompanied by meaningful cautionary statements
identifying important factors that could cause actual results to differ
materially from those projected in the information. The words "anticipate",
"believe", "expect", "estimate", "intend", "plan", "should", "could", "may",
"objective", "target", "goal" and "strategy" (or the negatives of such terms)
and other similar expressions are used in connection with forward-looking
statements. These forward-looking statements are based on information currently
available to the Company and are subject to a number of risks, uncertainties and
other factors that could cause the Company's actual results, performance,
prospects or opportunities to differ materially from those expressed in, or
implied by, these forward-looking statements. There can be no assurance that
forward-looking statements will approximate actual experience.
3
OLICOM REPORTS FIRST QUARTER 2002 RESULTS
COPENHAGEN, DENMARK, APRIL 24, 2002 -- Olicom A/S (OTC Bulletin Board: OLCMF)
("Olicom" or "the Company") today announced its financial results for first
quarter 2002.
With effect from the current fiscal year, Olicom has decided to change
the Company's accounting policy regarding the valuation of its investments in
affiliated companies. Up to now, such investments have been accounted for by the
equity method of accounting at the pro rata share of the companies' equity with
addition of goodwill and deduction of amortization of goodwill. Going forward,
the valuation will be made at the estimated market value. Planned operating
losses will thus no longer automatically result in write-down of the valuation,
as write-downs solely will be based on specific estimates of the market value of
the investments. Increases in valuation may be recognized if independent
documentation shows that a permanent increase in value has taken place.
It has been decided to change Olicom's accounting policy in order to
better be able to present a fair view of the Company's assets, financial
position and results. The change also facilitates comparison between the
Company's financial statements and those of other Danish and international
venture capital companies, as it will bring Olicom's accounting policy more in
line with generally applied accounting principles for such companies.
For comparison reasons, the Company's financial statements for 2001
have been adjusted in accordance with the new accounting policy. The adjusted
financial statements record shareholders' equity at year-end 2001 to be 244.3
million Danish kroner ("DKK"), or US$ 28.8 million, which is DKK 16.3 million,
or US$ 1.9 million, more than reported in the financial statements for 2001.
For the first quarter of 2002, Olicom realized a net loss of DKK 3.9
million, or US$ 455,000. The loss per share was DKK 0.22, or US$ 0.03 per share.
All amounts expressed in US dollars are calculated at the March 31, 2002, rate
of exchange between the US dollar and the Danish kroner.
As of March 31, 2002, Olicom had cash and restricted cash of DKK 172.0
million, or US$ 20.2 million. Shareholders' equity at March 31, 2002, was DKK
240.2 million, or US$ 28.3 million, corresponding to DKK 13.93 per share or US$
1.64 per share.
Recognising the very slow development of the demand for software
applications, which support companies' advanced use of handheld computers, etc.,
it was decided in the first quarter to wind up the affiliated company,
Transynergy. Olicom's decision to wind up Transynergy is adversely affecting the
first quarter results with DKK 4.0 million, or US$ 470,000.
In general, during first quarter 2002, the Company's other affiliated
companies performed as expected. Sifira, which develops and sells sophisticated
messaging systems to phone companies, has experienced a great interest among
potential customers in Denmark and Sweden and expects more, new contracts to be
concluded soon.
Decuma, which sells software for handwriting recognition, entered into
an agreement with HP Japan and expects more sales particularly in the Japanese
and other Asiatic markets where the use of handwriting recognition instead of
keyboards are especially advantageous.
Olicom expects that the results for 2002 will be negative in the range
of DKK 20 million, or US$ 2.5 million, compared to the earlier announced
expectation of a negative result in the range of DKK 60 million, or US$ 7.0
million. The changed expectation is solely due to the Company's changed
accounting policy. As a precaution, potential gains from exits or increases in
the value of affiliated companies have not been included in the expected
results.
"We are convinced that the market conditions of the IT industry will
improve considerably, but we are not certain when that will happen", says Boje
Rinhart, CEO of Olicom. "We have therefore chosen a prudent policy, particularly
focusing on maintaining a sound cash position. As a consequence, we have chosen
not to make follow-up investments in affiliated companies which, like
Transynergy, have been especially affected by the unfavourable market
condition."
ABOUT OLICOM
Olicom initiates or participates in the development of new products and
services that leverage leading-edge communications technologies, primarily with
a focus on satisfying the needs of mobile data communication users. Business
opportunities are identified both through Olicom's internal research and through
the solicitation of ventures with start-up companies, which are offered seed and
venture financing and access to the Company's established business network and
infrastructure. More information about Olicom is available from the Company's
SEC filings or by contacting the Company directly. Information is also available
on the Company's Web site at www.olicom.com.
Olicom is a registered trademark.
Except for historical information contained herein, the matters discussed in
this news release may contain forward-looking statements that reflect the
Company's current expectations and projections about its future results,
performance, prospects and opportunities. These forward-looking statements are
based on information currently available to the Company and are subject to a
number of risks, uncertainties and other factors that could cause its actual
results, performance, prospects or opportunities to differ materially from those
expressed in, or implied by, these forward-looking statements. Among the risks,
uncertainties and other factors that could cause results to differ are uncertain
market conditions, the successful implementation of the Company's new strategic
direction; the Company's need to continue to identify and acquire interests in
suitable portfolio companies; intense competition among capital providers to
acquire interests in technology companies; the dependence of the Company on the
financial and operating success of the enterprises in which it invests or
participates; and existing and future regulations affecting the Company's
business, the businesses of its portfolio companies or technology generally.
Further information may be found in Olicom's periodic filings with the U.S.
Securities and Exchange Commission (SEC), including the most recent reports on
Form 20-F and 6-K, which identify important risk factors related to the
Company's business that could cause actual results, performance, prospects or
opportunities to materially differ from those contained in the forward-looking
statements.
CONTACT INFORMATION:
Boje Rinhart, CEO
Olicom A/S
+45 (45) 27 00 00
bri@olicom.com
###
OLICOM A/S
Condensed Consolidated Statements of Income
(In thousands except for amounts per share)
<Table>
<Caption>
THREE MONTHS ENDED MARCH 31,
2001 2002 2002
---- ---- ----
CONVENIENCE
TRANSLATION
DKK USD
(Unaudited) (Unaudited) (Unaudited)
VALUATION ADJUSTMENTS, AFFILIATED COMPANIES (1,191) (5,637) $ (663)
-------- -------- --------
GROSS PROFIT (1,191) (5,637) (663)
-------- -------- --------
OPERATING EXPENSES
General and administrative 4,288 4,334 510
Restructuring charges (199) (3,981) (469)
-------- -------- --------
Total operating expenses 4,089 353 41
-------- -------- --------
INCOME/(LOSS) FROM OPERATIONS BEFORE
INTEREST AND INCOME TAXES (5,280) (5,990) (704)
Interest income and other, net 2,241 2,126 250
-------- -------- --------
INCOME/(LOSS) BEFORE INCOME TAXES (3,039) (3,864) (454)
Income taxes (720) 5 1
-------- -------- --------
NET INCOME/(LOSS) (2,319) (3,869) (455)
EARNINGS/(LOSS) PER SHARE, BASIC (0.13) (0.22) (0.03)
======== ======== ========
EARNINGS (LOSS) PER SHARE, DILUTED (0.13) (0.22) (0.03)
======== ======== ========
WEIGHTED AVERAGE SHARES OUTSTANDING,
INCLUDING COMMON STOCK EQUIVALENTS, BASIC 17,405 17,244 17,244
======== ======== ========
WEIGHTED AVERAGE SHARES OUTSTANDING,
INCLUDING COMMON STOCK EQUIVALENTS, DILUTED 17,405 17,244 17,244
======== ======== ========
</Table>
The balance sheets and statements of income include a convenience
translation for the most recent reporting period by applying the quarter-end
exchange rate of DKK 8.499 per US$ 1.00. This translation should not be
construed to imply that the DKK amounts actually represent, or have been or
could have been converted to, US dollars.
OLICOM A/S
Condensed Consolidated Balance Sheets
(In thousands)
<Table>
<Caption>
DECEMBER 31, MARCH 31, MARCH 31,
2001 2002 2002
---- ---- ----
CONVENIENCE
TRANSLATION
DKK DKK USD
(Audited) (Unaudited) (Unaudited)
ASSETS
Current assets:
Cash and cash equivalents 148,288 156,289 $18,389
Restricted cash 21,679 15,667 1,843
Accounts receivable 638 150 18
Prepaid expenses and other current assets 53,356 46,158 5,431
------- ------- -------
Total current assets 223,961 218,264 25,681
Long-term assets 3,677 3,010 354
Investments, property and equipment, net 969 769 91
Investments in affiliated companies 58,291 58,741 6,911
------- ------- -------
TOTAL ASSETS 280,784
286,898 33,037
======= ======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities 42,551 40,553 $ 4,771
------- ------- -------
Total current liabilities 42,551 40,553 4,771
Shareholders' equity 244,347 240,231 28,266
------- ------- -------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 280,784 286,898 33,037
======= ======= =======
</Table>
The balance sheets and statements of income include a convenience
translation for the most recent reporting period by applying the quarter-end
exchange rate of DKK 8.499 per US$ 1.00. This translation should not be
construed to imply that the DKK amounts actually represent, or have been or
could have been converted to, US dollars.
Investments in Affiliated Companies as of March 31, 2002
<Table>
<Caption>
SHAREHOLDING INVESTMENT
(NON-DILUTED) (DKK 1,000)
------------- -----------
Danacell A/S 13.0% 929
Decuma AB 8.5% 4,984
GoPinocchio ApS 28.2% 3,560
Hymite A/S 16.9% 9,000
ITE ApS 50.0% 10,000
LH Comlog A/S 14.5% 6,250
Mobite A/S 17.2% 8,238
Scalado AB 22.2% 6,431
Sifira A/S 50.7% 11,793
Vizion Factory e-Learning A/S 4.8% 5,000
------ ------
INVESTMENTS IN TOTAL 66,185
Write-down (7,444)
Write-up 0
INVESTMENTS IN AFFILIATED COMPANIES 58,741
------
</Table>
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