Sapphire Corporation Limited (Catalist:NF1) entered into a conditional sale and purchase agreement to acquire Mancala Holdings Pty Ltd from Martin Kyne, Francis William Lannen and Timothy Edwin Akerman for AUD 15 million in stock on October 9, 2013. The consideration is subject to adjustments. Under the terms of deal, Sapphire will acquire 0.19 Class A shares from Martin Kyne, Francis William Lannen and 0.02 Class A shares from Timothy Edwin Akerman. Sapphire will acquire 0.05 Class B shares from Martin Kyne, Francis William Lannen and 0.01 Class B shares from Timothy Edwin Akerman. Sapphire will pay first tranche of the consideration in the amount of AUD 1.5 million in shares of Sapphire Corporation, second tranche of AUD 4 million will be paid as AUD 1 million cash and AUD 3 million in shares of Sapphire Corporation subject to the issue of the audited financial statements of Mancala for the 12 months ending December 31, 2014, final tranche of AUD 9.5 million will be paid as AUD 4 million in cash and AUD 5.5 million in shares of Sapphire Corporation subject to the issue of the audited financial statements of Mancala for the 12 months ending December 31, 2015.

The deal is financed from internal sources of funds and/or external borrowings of Sapphire Corporation to finance the cash portion of the consideration. In connection with transaction, Sapphire has agreed to grant a loan of AUD 2 million to Mancala. For the year ending 12 months ended June 30, 2013, EBITDA of Mancala Holdings was AUD 2.8 million, net loss after tax was AUD 2.1 million and net asset value was AUD 13 million. The deal is subject to the results of the due diligence exercise to be conducted in respect of Mancala being satisfactory, Martin Kyne, Francis William Lannen, Timothy Edwin Akerman and all other senior staff of Mancala having agreed to the terms of their service agreements with Sapphire Corporation, the receipt by Sapphire of such waivers or consents as may be necessary to enable Sapphire and/or its nominee to be registered as holder of the sale shares, including approval or waiver by the Foreign Investments Review Board of Australia, if applicable. If any of the conditions have not been fulfilled (or waived) by the date falling 3 months from the date of the agreement, the deal can be terminated.

Sapphire Corporation Limited (Catalist:NF1) completed the acquisition of Mancala Holdings Pty Ltd from Martin Kyne, Francis William Lannen and Timothy Edwin Akerman on January 7, 2014.