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At meeting held on 17 April 2017Autoline Industries announced that the Board of Directors at its meeting held on 17 April 2017 considered the matter of dispute raised by CJ Holdings North America, LLC (CJ Holdings) with reference to Stock Purchase Agreement dated 23 December 2014 (SPA) entered into by the Company with CJ Holdings for selling of its entire holding in its Overseas Subsidiaries i.e. Autoline Butler, Indiana and its step down subsidiaries.
CJ Holdings alleged the accuracy of certain representations and warranties in the SPA and the consummation of the transactions contemplated in the SPA and claimed that it sustained substantial damages.
After in depth study of claim and thorough discussion with US Counsel/Attorney of the Company and independent firm of CPA's, the matter was put before the Board meeting of the Company for consideration and the Board deliberated in the matter and it was noted that the Company does not accept any of the allegations of CJ but considering the high likelihood that CJ Holding will recover $ 1.00 million under SPA as indemnification damages cap, high cost of litigating a lawsuit in US, uncertainty of outcome of litigation etc. the Board has approved and accepted settlement of claim for an amount of $ 1.7 million which is to be paid in instalments upto 16 June 2018 subject to RBI and other necessary approvals. The Company has executed settlement agreement on 18 April 2017.
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