magicJack Announces Repurchase of $13 Million in Stock and Founder's Exit From
WEST PALM BEACH, Fla. and JERUSALEM, Nov. 12, 2013 (GLOBE NEWSWIRE) --
magicJack VocalTec, Ltd. (Nasdaq:CALL), a leading cloud communications
company, announced that it has repurchased in privately negotiated
transactions 1,062,092 of the Company's ordinary shares at $12.24 per share,
for an aggregate purchase price of approximately $13 million. The shares were
purchased pursuant to agreements entered into with the independent trustees of
two irrevocable trusts previously created by the Company's founder, Daniel M.
The Company has also entered into an agreement with Mr. Borislow which
provides that Mr. Borislow will not have any ongoing involvement in the
business or operations of the Company or any of its subsidiaries. The
agreement contains a standstill provision under which Mr. Borislow agrees, for
a period of two years, to refrain from taking certain actions as a shareholder
of the Company.Except as limited by this provision, Mr. Borislow may still
exercise his shareholder rights.Mr. Borislow has also agreed not to compete
with the Company or to solicit its employees without the Company's consent
during the next two years.Mr. Borislow has also agreed to the assignment of
certain intellectual property rights for the benefit of the Company.The
Company will issue 300,000 of its ordinary shares to Mr. Borislow in exchange
for his obligations under this agreement.
The Company has also executed a Letter of Intent committing to negotiate an
agreement to outsource to a customer care company affiliated with Mr. Borislow
certain live chat customer care activities currently provided to the Company
primarily by a third party.The Company has allowed Mr. Borislow to solicit
six current Company employees to assist with the operation of the customer
care company.If the customer care agreement is executed, the customer care
services performed under such agreement will constitute an express and limited
exception to the limit on Mr. Borislow's activities on behalf of the Company
described above.The Letter of Intent provides for the Company to pay a $1.5
million break-up fee to the customer care company if an agreement on the terms
of such customer care activities is not reached by December 20, 2013.
"The share repurchase demonstrates our strong conviction about the future
growth potential of our business and building long-term shareholder value,"
said magicJack VocalTec President and CEO Gerald Vento.
About magicJack VocalTec Ltd.
magicJack VocalTec Ltd. (Nasdaq:CALL), the inventor of the magicJack, is a
leading cloud communications company. The Company has sold more than 10
million of the easy-to-use, award-winning magicJack since the device's launch
in 2007, and has the use of more than 30 patents. It is the largest-reaching
CLEC (Competitive Local Exchange Carrier) in the United States in terms of
area codes available and certification in number of states, and the network
has historically had uptime of over 99.99 percent.
CONTACT: Seth Potter
Press spacebar to pause and continue. Press esc to stop.