Enea informs about initiated arbitration proceedings regarding contract interpretation issues
Enea and one of its largest customers have found that they interpret differently the provisions on calculation of royalties under their contract regarding the use of Enea’s OSE operating system in the customer’s telecommunication equipment.
Enea has initiated arbitration proceedings regarding the interpretation issues.
Enea’s CEO, Anders Lidbeck, comments: ”The arbitration proceedings have been initiated for the purpose of obtaining clarity in an orderly fashion for both us and the customer regarding the correct interpretation of our contract. We believe that we have a sound basis for our position, but the proceedings will duly determine what applies.”
If Enea’s position is correct, Enea is entitled retroactively to receive a substantial amount of further royalties from the customer. The additional amount preliminarily claimed from the customer is SEK 900 million, but this amount is based on estimations and may be significantly revised in either direction. If Enea’s position regarding the interpretation issues is correct, this would also have a positive impact on the basis for calculation of royalties going forward. If Enea’s position regarding the interpretation issue is wrong, then Enea is not entitled to receive more than Enea has already received under the customer’s interpretation of the contract, and the customer’s interpretation of the contract will then also govern the calculation of future royalties. However, regardless of how the interpretation issue is resolved, future royalties are to a large extent dependent on the customer’s future use of Enea’s technology.
Enea profoundly appreciates its long-standing and good business relationship with the customer, but has concluded that in light of the substantial amounts involved it is necessary to have the interpretation issues legally sorted out. Arbitration is the procedure agreed upon in the contract with the customer to resolve interpretation issues like this.
This information is information that Enea AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out below, at 08:00 a.m. CET on November 3, 2016.
For more information visit www.enea.com/investors or contact:
Anders Lidbeck, President & CEO
Julia Steffensen, Investor Relations
Phone: +46 70 971 03 33
Enea is a global supplier of network software platforms and world class services, with a vision of helping customers develop amazing functions in a connected society. We are committed to working together with customers and leading hardware vendors as a key contributor in the open source community, developing and hardening optimal software solutions. Every day, more than three billion people around the globe rely on our technologies in a wide range of applications in multiple verticals – from Telecom and Automotive, to Medical and Avionics. We have offices in Europe, North America and Asia, and are listed on Nasdaq Stockholm. Discover more at www.enea.com and start a conversation at firstname.lastname@example.org.
Enea®, Enea OSE®, Netbricks®, Polyhedra®, Zealcore®, Enea® Element, Enea® Optima, Enea® LINX, Enea® Accelerator, Enea® dSPEED Platform and COSNOS® are registered trademarks of Enea AB and its subsidiaries. Enea OSE®ck, Enea OSE® Epsilon, Enea® Optima Log Analyzer, Enea® Black Box Recorder, Polyhedra® Lite, Enea® System Manager, Enea® ElementCenter NMS, Enea® On-device Management and Embedded for LeadersTM are unregistered trademarks of Enea AB or its subsidiaries. Any other company, product or service names mentioned above are the registered or unregistered trademarks of their respective owner. © Enea AB 2016.