Q-Free ASA — M&A Activity 2014

Oct 30, 2014

Q-FREE SELLS SHARES IN NOCA AS – EXTENDED STOCK EXCHANGE NOTIFICATION

This enclosure contains additional information about Q-Free's sale of its shares in Noca AS, in accordance with Section 3.4 of Continuing Obligations for companies listed on Oslo Stock Exchange.

According to the signed Share Purchase Agreement (SPA), Q-Free has agreed to sell its 53.48 % shares in NOCA AS to Simpro Holding AS after 13 years of ownership. Simpro Holding is owned 45.0 percent by Salvesen&Thams AS, 31.7 percent by Midvestfondene and 23.3 percent by employees and other shareholders.

The net consideration for the shares after cost and dividend distribution is NOK 19.5 million. The net consideration will be paid in cash on closing and the consideration is fully financed by the buyer. Q-Free expects the transaction to be closed during the fourth quarter 2014 and the activities of Noca will be taken out of the consolidated accounts of Q-Free with effect of closing.

On an audited basis, the main results from the operations in Noca AS are as follows on a 100 percent basis:

NOK 1000	2011	2012	2013
Revenues	80 277	100 926	86 118
GP	33 382	41 412	38 747
Operating expenses	30 979	33 722	34 061
EBITDA	2 401	7 688	4 683
EBIT	1 253	6 225	3 278
EBIT-margin	1.6 %	6.2 %	3.8 %
Profit before tax	1 008	6 309	3 446
Profit after tax	690	4 327	2 859
Total assets:	59 509	66 297	62 254
Equity	38 223	43 804	42 657
Equity ratio	64.2 %	66.1%	68.6%

Noca AS was established in 1986, and is a modern supplier of products and solutions within electronics manufacturing and electronic-mechanical assembly to high tech companies. Noca has 45 employees on the date of the sale and is located in Trondheim.

The CEO Frank Rudi leads a management team of 6 people; Pauline Holden (Finance Manager), Sveinung Ryen (Operations Manager), Petra Yan (Logistics Manager), Kristian Fossum (Industrialization Manager), Jon H Singsaas (Sales Manager) and Lena Eide (Administration Manager).

The Board of Directors of Noca AS consists of Chairman Henrik Stoltenberg (CSO Q-Free) , Bjørn Fossum (independent), Inger Heidi Slungård (Q-Free) and Terje Rian (employee elected) at the time of the transaction.

The transaction triggers no agreements to the benefit of members of the managements or Board of Directors in Noca.

Q-Free have strategically no need to own an electronics development and manufacturing company within the current strategy of Q-Free, and Q-Free will rather focus on developing the core business within Road User Charging and Advanced Transportation Management.

Q-Free and Noca/Simpro will continue its cooperation and will before closing agree on a delivery contract within the excisting defined product range on competitive terms and conditions. The term for this agreement will be until 31 March 2017 with an option to extend this for another two years.

Approximately 12 percent of Q-Free's revenues was generated from Noca in 2013.