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Michael Colaco sells 2.8 million Cavotec shares to pay USD 6.7 million to Cavotec SA

08:00 / 18 May 2016 Cavotec Press release

Michael Colaco sells 2.8 million Cavotec shares to pay USD 6.7 million to
Cavotec SA

The Chief Executive Officer of Cavotec SA ("Cavotec" or the "Company"), Ottonel
Popesco, is pleased to announce that on 17 May 2016, Michael Colaco, the former
owner of INET Airport Systems, sold 2.8 million shares in Cavotec SA in order
to pay USD 6.7 million pursuant to the court judgment entered in favour of
Cavotec in a lawsuit in the Orange County Superior Court in California, USA.
The payment of USD 6.7 million is in addition to payments Cavotec already
collected from Mr. Colaco that totalled USD 1.8 million. 

As previously reported, Mr. Colaco has filed a Notice of Appeal of the
judgment, and Cavotec expects Mr. Colaco to proceed with his appeal, which
could postpone a final settlement to early 2017. The payment made by Mr. Colaco
will positively affect the Company’s 2Q16 results by approximately USD 5.8

The background to this payment is the lawsuit in the U.S. that was filed by Mr.
Colaco in 2012 against Cavotec and its Chairman and CEO. The lawsuit was
initiated by Mr. Colaco, the former owner of INET Airport Systems, following
his suspension and dismissal as Managing Director of Cavotec INET and as a
member of the Company's Executive Management Committee. The Company filed
several counter-claims against Mr. Colaco, his former company, and others,
including claims for breach of fiduciary duty, misappropriation of funds, and
breach of contract. 

Following a seven-week courtroom trial in California between Cavotec and Mr.
Colaco, a 12-person jury, on 18 and 19 June, 2015 (PSDT), issued a verdict in
favour of Cavotec, the Chairman of its Board of Directors, and the CEO. The
jury rejected Mr. Colaco's claim in his lawsuit that Cavotec, the Chairman and
the CEO owed him USD 3.8 million pursuant to agreements that were allegedly
breached. The jury instead determined that Mr. Colaco breached his fiduciary
duties to Cavotec with malice, oppression and fraud, and, that, as a result, he
must pay compensatory and punitive damages, plus attorneys’ fees and costs, for
a total judgment of USD 8 million to Cavotec subsidiary, Cavotec INET US Inc.
Accordingly, the verdict effectively amounted to a victory for Cavotec in the
amount of USD 11.8 million. 


For more information, please contact:

Michael Scheepers

Chief Communications Officer or +41795024010

The information in this release is subject to the disclosure requirements of
Cavotec SA under the Swedish Securities Market Act and/or the Swedish Financial
Instruments Trading Act. This information was publicly communicated on 18 May
2016, 08:00 CEST

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