VMOTO SECURES OEM SUPPLY AGREEMENT WITH VECTRIX
Vmoto Limited (“Vmoto” or “the Company”) is pleased to announce it has today signed an agreement to OEM Manufacture for Vectrix, LLC its VX2 model electric scooter (“Vectrix”), North America’s largest and most reputable electric scooter manufacturer and distributor with over 100 dealers in place and sub distribution agreements with multinational retail selling points.
Pursuant to the agreement, Vmoto’s wholly owned electric scooter manufacturing division, Emax, will manufacture and supply an initial shipment of 144 units of the VX2 scooter, which has been exclusively designed in partnership with Vectrix. The scooter will be powered by Silica Ion batteries and meet the stringent DOT import approvals required for personal transport vehicles in the USA. Under the terms of the agreement, Vmoto’s Emax will be the exclusive OEM Manufacturer and Vectrix will have the global exclusive sales and marketing rights for the VX2 scooter.
Vectrix has been a market leader in electric scooters in recent years following the release of its premium maxiscooter line, the VX1. It now plans to expand its product offering by introducing its versatile all electric scooter class, the VX2 series. Vectrix being a premium brand leader with the highest level of quality products, is happy to offer this leading edge all electric scooter with its iconic design features and its multifunctional patented regenerative throttle technology that make it uniquely a Vectrix.
Vectrix conducted extensive market research in relation to the USA market, such research indicating a potential market in the USA of 7000 units per annum. The minimum number estimated to be required by Vectrix over the next 18 months is approximately 2000 units.
Vmoto’s Managing Director, Patrick Davin, commented: “It’s great for Vmoto to now have a presence in the USA market via this new OEM agreement with Vectrix. Vectrix is one of the pioneers of the electric scooter industry and are just the sort of company that Vmoto, through its acquisition of Emax, likes to associate itself with. Their experience in the electric scooter industry will also hopefully lead to a further mutual cooperation in relation to future developments by both companies. The USA has very big potential as the demand for environmentally friendly types of transport increases and we see this agreement as very significant step forward for our electric division. The initial order of 144 units is seen as an important stepping stone to bigger things.
“We are looking forward to making this first shipment in August this year and I am sure it is the beginning of a very important relationship for both Vmoto and Vectrix.” In addition to the recent Vectrix deal, the electric division of Vmoto has also recently made container shipments to the MSA Group in Germany and is preparing shipments later this month for Spain and Australia. A number of trial shipments to other customers worldwide have also taken place.
The recent acquisition of Emax and the transfer of its manufacturing to the Vmoto Nanjing manufacturing facility have now put Vmoto Emax in an excellent position to meet customer demand with no further restrictions applicable to its manufacturing capacity.
Vmoto Emax also has a number of other distribution agreements being negotiated for the products produced in Nanjing and will advise the market as these new agreements are completed.
VMOTO ACQUIRES REMAINING 40% OF E-MAX ELECTRIC SCOOTERS TO TAKE OWNERSHIP TO 100%
Vmoto Limited (“Vmoto” or “the Company”) is very pleased to announce that it has signed a Heads of Agreement with the minority shareholders in Vmoto E-Max Electric Vehicle Company, Nanjing (“VE-Max”), to acquire the remaining 40% interest in the issued capital of VE-Max and take Vmoto’s interest to 100%.
E-Max is one of the world’s leading manufacturers of electric scooters, with a Munich based development centre and a production base in China. As announced on 10 December 2010 and 21 December 2010, Vmoto owns 60% of VE-Max, following a payment of €1.0million (AUD$1,640,000) to the existing E-Max shareholders and a €2.5million (AUD$4,100,000) capital injection to the new company.
Since January 2010, the existing management and manufacturing plant and equipment of E- Max have been transferred to Vmoto’s state of the art new scooter assembly plant in Nanjing, China. This transfer was concluded in mid May 2010 and mass production for a growing order book has now commenced from the Nanjing facility.
After working with Vmoto for the last 5 months, the 40% minority shareholders of VE-Max (“Vendors”) have agreed to sell their shareholding in VE-Max to Vmoto, in exchange for 22,400,000 ordinary fully paid shares in Vmoto, at a deemed issue price of 20 cents. The shares will be issued within 30 days of execution of the Heads of Agreement pursuant to Vmoto’s existing 15% placement capacity and will be held in voluntary escrow for a period of 12 months from the date of issue.
Further, in the event that 5,000 electric scooters are commercially sold from the VE-Max production lines in Nanjing within 12 months of the date of execution of the Heads of Agreement, Vmoto has also agreed to issue to the Vendors and/or their nominees 2,240,000 options over Vmoto shares, each with an exercise price of 20 cents and exercisable within three years from the date of issue.
Mr Patrick Davin, Vmoto’s Managing Director, today commented: “This is a well thought out strategic move by both parties. As we have worked with E-Max over the last 5 months, it has become clear that in order to run the operations to maximum effect in conjunction with our existing operations, we need to merge the group to run as one. Fortunately, the E-Max people have also seen that as Vmoto Limited continues to grow, their best return on investment to date will be to become shareholders of the parent company and enjoy the growth of the entire organisation, rather than just the electric division.
“This comes at a time when the world’s focus on electric transport is accelerating, with many governments around the world pushing our type of products. Being one of the world’s biggest in this area means that our factory is seeing a constant flow of customers taking samples for their respective markets. The completion of Stage 2 of our factory cannot come fast enough.
“This acquisition will bring significant cost saving benefits to Vmoto, with many duplicated positions being made redundant as the two teams merge into one. From a day to day management standpoint, there is no question that the operations will be easier to run.
“There will be little change to the senior management team of the old E-Max and I look forward to working with them to meet increasing customer demand.”
The acquisition of the remaining 40% interest in VE-Max comes as Stage 2 of Vmoto’s manufacturing facility in Nanjing continues to be built ahead of schedule. It is anticipated that Stage 2 of the Nanjing facility will be ready for scooter manufacture early in the 2011 calendar year. Until that time, Vmoto has the capacity in its existing factory to meet the E-Max demand.
