Betolar Oyj: Inside information: Betolar Plc successfully completes directed share issue of 1,960,688 new shares raising EUR 2.35 million

BETOLAR PLCInside information28 August 2024 at [22:50] p.m. EEST

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Inside information: Betolar Plc successfully completes directed share issue of 1,960,688 new shares raising EUR 2.35 million

Betolar Plc ("Betolar" or the "Company") announces the result of the directed issue of new shares in the Company (the "Shares") to eligible institutional and other professional investors (the "Placing"). The Placing and the cost adjustment measures previously implemented by the Company enable Betolar to focus on the mining and metals business in line with its strategic reorientation and to have sufficient financing at least until 2027.

The meeting of the Board of Directors of the Company held on 28 August 2024 resolved to issue 1,960,688 Shares in the Placing based on the authorisation granted to the Board of Directors by the Company's Annual General Meeting held on 27 March 2024 and in deviation from the shareholders' pre-emptive subscription rights.

The subscription price for the Shares was EUR 1.20 per Share, reflecting the current market value determined based on 5-day volume-weighted average price, rounded to the nearest cent. The closing price of the Company's share was EUR 1.15 per share on 28 August 2024. As a result of the Placing, the Company will raise gross proceeds of approximately EUR 2.35 million. The subscription price will be recorded in full to the Company's invested unrestricted equity reserve.

In order to ensure the successful completion of the Placing, the share issue was directed to certain current shareholders of the Company based on their status as long-only institutional and other professional investors with understanding on the Company's business and the industry in which it operates. The Company's long-term shareholders, Nidoco AB and Voima Ventures Fund II LP, subscribed Shares in the Placing. Nidoco AB as the Company's largest shareholder had irrevocably undertaken to subscribe for Shares in the event that the maximum number of Shares would have not been subscribed for in the Placing.

The Company has carefully assessed its financing needs and options in its current development stage and market environment. The development and commercialisation of Betolar's solutions have caused and will continue to cause significant costs to the Company. As disclosed earlier, to mitigate the expenditures, the Company has taken active measures to secure the financial conditions to implement its strategy, which was updated in 2023, and to achieve its business and financial goals, which were renewed in February 2024. The Company has significantly adjusted its cost structure during 2023 and 2024, applied for public business financing for research and development, and renewed its Management Team. According to the assessment of the Board of Directors, the Placing will now strengthen the Company's balance sheet and improve its liquidity position in a rapid and cost-effective manner as well as increase the Company's credibility and operating freedom from the perspective of its personnel, clients and investors. The Board of Directors has considered other financing options, including various debt and equity financing options, but the other alternatives would have involved significant costs, timetable requirements as well as uncertainties related to the implementation which are not in the interest of the Company and its shareholders when taking into account the Company's current need to fully focus on developing its business in line with its strategy and under the leadership of its new Management Team. Therefore, the Board of Directors of the Company has considered that there is a weighty financial reason for the Company to deviate from the pre-emptive subscription rights and that the Placing is in the interest of the Company and its shareholders.

The Board of Directors has accepted the terms and conditions of the Placing and the Share subscriptions made in accordance with the terms and conditions of the Placing. The terms and conditions of the Placing are attached to this company announcement. In line with the resolution of the Company's Board of Directors, Anders Dahlblom has not participated in and has refrained from the work of the Company's Board of Directors concerning the Placing due to his material connections to and interests in Nidoco AB. Correspondingly, in line with the resolution of the Company's Board of Directors, Inka Mero has not participated in and has refrained from the work of the Company's Board of Directors concerning the Placing due to his material connections to and interests in Voima Ventures Fund II LP.

In connection with the Placing, the Company has agreed to enter into a lock-up undertaking, according to which it will, subject to certain customary exceptions, undertake not to issue or sell shares in the Company during a period of 90 days after the completion of the Placing.

The Shares subscribed for in the Placing represent approximately 10 per cent and 9.1 per cent of, respectively, all shares in the Company prior to and following the Placing. After the Shares subscribed for in the Placing have been registered with the Finnish Trade Register, the total number of all registered shares in the Company will be 21,567,570.

The Shares are expected to be registered with the Finnish Trade Register on or about 29 August 2024. The Shares offered in the Placing are expected to be ready for delivery to the investors against payment through Euroclear Finland Ltd on or about 2 September 2024. Trading in the Shares is expected to commence on Nasdaq First North Growth Market Finland on or about 2 September 2024. The Shares will rank pari passu in all respects with the existing shares of the Company once they have been registered with the Finnish Trade Register.

Skandinaviska Enskilda Banken AB (publ) Helsinki branch acts as the Bookrunner of the Placing. Hannes Snellman Attorneys Ltd acts as the legal adviser to the Company.

Betolar Plc

Board of Directors

For further information, please contact:  

Tuija Kalpala, President and CEO, Betolar Plc, tel. +358 50567 6608, tuija.kalpala@betolar.com

Certified Advisor:

Aktia Alexander Corporate Finance Oy, tel. +358 50520 4098

About Betolar Plc

Betolar Plc is a pioneering Finnish materials technology company driving the green transition in mining and construction. Betolar's mission is to help reduce CO₂ emissions and the use of virgin natural resources.

Betolar develops low-carbon and waste-free solutions for the mining and metals industries, and its Geoprime® solution produces i.a. the world's lowest-emission hollow-core slabs. Betolar's AI-powered Data Platform turns industrial side streams into value, accelerates solution development and builds global markets for side streams.

Betolar was founded in 2016 and is domiciled in Kannonkoski, Finland. Betolar is listed on the Nasdaq First North Growth Market. For more information, visit www.betolar.com

APPENDIX 1: TERMS AND CONDITIONS OF THE DIRECTED SHARE ISSUE

TERMS AND CONDITIONS OF THE DIRECTED SHARE ISSUE

The Board of Directors of Betolar Oyj (the "Company" or "Betolar") has in its meeting on 28 August 2024, by virtue of the authorisation granted by the Annual General Meeting of the Company on 27 March 2024, resolved that the Company shall issue up to 1,960,688 new shares of the Company (the "Shares") by a directed share issue. The Shares will be issued on the following terms and conditions:

1Subscription

Up to 1,960,688 new Shares shall be issued in the share issue. The Shares are offered to be subscribed for by institutional and professional investors obtained by the manager of the share issue, Skandinaviska Enskilda Banken AB (publ) Helsinki Branch (the "Manager"), in deviation from the pre-emptive subscription rights of the shareholders set forth in Chapter 9, Section 3 of the Finnish Companies Act.

2Subscription price and its entry into balance sheet

The subscription price for the Shares is EUR 1.20 per Share. The subscription price for the Shares has been determined based on the recent market value of the Company's share, also taking into account investor feedback and subscription indications received by the Manager. The Board of Directors of the Company has considered the subscription price to represent the fair value of the Shares from the point of view of the Company and all its shareholders.

The subscription price will be credited in full to the Company's reserve for invested unrestricted equity.

3Place of subscription

The subscription shall be made during the meeting of the Board of Directors of the Company on 28 August 2024. The Board of Directors reserves the right to reject, partly or entirely, any subscription made if the subscription has not been paid in accordance with these terms and conditions, or to approve a new subscriber. No interest shall be paid on funds returned by the Company in case a subscription is partly or entirely rejected.

4Terms of payment

The subscription price of the Share shall be paid on 29 August 2024 at 10:00 a.m. Finnish time, at the latest, in accordance with the approval of the allocation by the Board of Directors of the Company, unless the Board of Directors of the Company in its discretion resolves to grant an extension to the payment period.

5Right to dividend and other rights

The Shares carry a right to dividend and other shareholder rights as from the date they are registered with the Finnish Trade Register and entered into the book-entry system maintained by Euroclear Finland Oy.

6Reasons for deviating from the pre-emptive subscription rights of the shareholders

The Company has carefully assessed its financing needs and options in its current development stage and market environment. The development and commercialisation of Betolar's solutions have caused and will continue to cause significant costs to the Company. To mitigate the expenditures, the Company has taken active measures to secure the financial conditions to implement its strategy, which was updated in 2023, and to achieve its business and financial goals, which were renewed in February 2024. The Company has significantly adjusted its cost structure during 2023 and 2024, applied for public business financing for research and development, and renewed its Management Team. According to the assessment of the Board of Directors, the share issue would now strengthen the Company's balance sheet and improve its liquidity position in a rapid and cost-effective manner as well as increase the Company's credibility and operating freedom from the perspective of its personnel, clients and investors. The Board has considered other financing options, including various debt and equity financing options, but the other alternatives would have involved significant costs, timetable requirements as well as uncertainties related to the implementation which are not in the interest of the Company and its shareholders when taking into account the Company's current need to fully focus on developing its business in line with its strategy and under the leadership of its new Management Team. Therefore, the Board of Directors of the Company has considered that there is a weighty financial reason for the Company to deviate from the pre-emptive subscription rights and that the share issue is in the interest of the Company and its shareholders.

7Registration of shares to book-entry accounts and trading

The Shares subscribed for in the share issue shall be issued as book-entries in the book-entry system maintained by Euroclear Finland Oy.

The Shares are expected to be registered with the Finnish Trade Register on or about 29 August 2024. The new Shares are freely transferable.

The Company will apply for filing of the new Shares, subscribed through the share issue, to be listed on Nasdaq First North Growth Market Finland, maintained by Nasdaq Helsinki Ltd, and traded equally with the other shares of the Company.

8Other terms

The share issue shall be governed by the laws of Finland. Any disputes arising in connection therewith shall be settled by a court of competent jurisdiction in Finland.

The Board of Directors of the Company will decide on other matters related to the share issue and practical arrangements resulting therefrom.

Forward-Looking Statements

This release contains forward-looking statements, including, without limitation, statements regarding Betolar's strategy, business plans and focus. The words "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," believe," "estimate," "predict," "project," "potential," "continue," "target" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Any forward-looking statements in this release are based on management's current expectations and beliefs and are subject to a number of risks, uncertainties and important factors that may cause actual events or results to differ materially from those expressed or implied by any forward-looking statements contained in this release, including, without limitation, any related to Betolar's business, operations, supply chain, strategy, goals and anticipated timelines and competition from other companies. Betolar cautions you not to place undue reliance on any forward-looking statements, which speak only as of the date they are made. Betolar disclaims any obligation to publicly update or revise any such statements to reflect any change in expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements. Any forward-looking statements contained in this release represent Betolar's views only as of the date hereof and should not be relied upon as representing its views as of any subsequent date.

Important notice

The information contained herein shall not constitute an offer to sell or the solicitation of any offer to buy or subscribe for, nor shall there be any sale of the securities referred to herein in any jurisdiction.

The information contained herein may not be announced, published, copied, reproduced or distributed, directly or indirectly, in whole or in part, within or into the United States, Australia, Canada, Hong Kong, South Africa, Singapore, New Zealand or Japan or in any other jurisdiction in which such announcement, publication or distribution would not comply with applicable laws and regulations or where such actions are subject to legal restrictions or would require additional registration or other measures than what is required under Finnish law. This press release does not constitute an offer of securities for sale in the United States, nor may the securities be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements under the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder. There is no intention to register any portion of the offering in the United States or to conduct a public offering of the securities in the United States.

In any EEA Member State, this announcement is only addressed to and is only directed at qualified investors in that Member State within the meaning of Regulation (EU) 2017/1129 ("Relevant Persons"). Persons who are not Relevant Persons should not take any action on the basis of this announcement and should not act or rely on it.

Skandinaviska Enskilda Banken AB (publ) Helsinki branch acts only for and on behalf of the Company in connection of the Placing. Skandinaviska Enskilda Banken AB (publ) Helsinki branch does not hold any other party as their client or cannot be held accountable to advise or indemnify other parties than the Company with regards to the Placing or other matters referred here to.