NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN CANADA,
JAPAN, AUSTRALIA OR THE UNITED STATES, OR ANY OTHER JURISDICTION IN WHICH SUCH
RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES
NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.
Oslo, 14 December 2024: Reference is made to the stock exchange announcement by
Huddly AS ("Huddly" or the "Company", ticker: HDLY) earlier today, regarding a
contemplated private placement of NOK 130 million (the "Offer Size"), equivalent
to 1,300,000,000 new shares (the "Offer Shares") offered by the Company with a
fixed price per Offer Share of NOK 0.10 (the "Offer Price" and the "Private
Placement").
The Company is pleased to announce that it has conditionally allocated the Offer
Shares in the Private Placement at the Offer Price, raising gross proceeds of
NOK 130 million. The Private Placement received strong support from the
Company's primary insiders and existing shareholders, as well as from new
investors, and it ended up being significantly over-subscribed.
The Company retained Pareto Securities AS as sole manager and bookrunner (the
"Manager") to assist with the Private Placement.
The size of the Private Placement is based on the Company's board of directors'
best understanding of the financial development and liquidity projections going
forward and is deemed sufficient for the Company to succeed with its new
strategy to secure a positive cash flow from the end of 2025. Of the total NOK
130 million in gross proceeds to the Company, approx. NOK 100 million will be
channeled to R&D (including the development of Huddly Crew+) as well as
go-to-market and sales efforts, while the remaining approx. NOK 30 million will
be used for working capital requirements and general corporate purposes.
The Company's board of directors (the "Board") has today resolved to
conditionally allocate the Offer Shares, pending an extraordinary general
meeting in the Company, to be held on 19 December 2024 (the "EGM"), to approve
the share capital increase pertaining to the Private Placement and issue the
Offer Shares and to authorize the Board to issue new shares in a potential
Subsequent Repair Offering (as defined below). The notice to the EGM was
attached to a separate stock exchange announcement published by the Company on 5
December 2024.
Notice of conditional allocation and payment instructions to the applicants in
the Private Placement will be communicated by the Manager on or about 16
December 2024, and the Private Placement is expected to be settled by the
Manager on a delivery-versus-payment ("DVP") basis on or about 27 December 2024,
subject to fulfilment of the Conditions as set out below and processing time
with the Norwegian Register of Business Enterprises (the "NRBE") pertaining to
registration of the share capital increase (such registration to be notified in
a separate stock exchange announcement on the registration date). The DVP
settlement of the Offer Shares in the Private Placement will be facilitated by a
pre-payment agreement entered into between the Company and the Manager (the
"Pre-Payment Agreement").
The Offer Shares will not be tradable on Euronext Growth Oslo before the share
capital increase pertaining to the issuance of the Offer Shares has been
registered with the NRBE, the Offer Shares have been registered with the
Norwegian Central Securities Depository (Euronext Securities Oslo or the "VPS")
and the share capital increase has been announced by the Company, expected on or
about 23 December 2024.
Completion of the Private Placement is still subject to (i) the EGM resolving to
approve the share capital increase pertaining to the Private Placement and the
issuance of the Offer Shares, (ii) the Pre-Payment Agreement remaining in full
force and effect, (iii) the share capital increase pertaining to the issuance of
the allocated Offer Shares being validly registered with the NRBE, and (iv) the
allocated Offer Shares being validly issued and registered in the VPS, jointly
the "Conditions").
Following (and subject to) the issuance of Offer Shares in the Private Placement
(but prior to the Subsequent Repair Offering), the Company will have a share
capital of NOK 1,147,705.03, divided into 1,836,328,048 shares.
Subscription by primary insiders and employees of the Company and lock-up
The following primary insiders and employees of the Company (or persons closely
associated with them) have been allocated Offer Shares for a total of approx.
NOK 49.5 million (approx. 38.1% of the Private Placement) at the Offer Price in
the Private Placement (% ownership share is pre-money ownership):
o Jostein Devold, chair of the Board: NOK 0.5 million.
o Mertoun Capital AS (7.06%), being a company closely associated with Jostein
Devold, chair of the Board: NOK 10 million.
o Sonstad AS (7.33%), being a company closely associated with Jon Øyvind
Eriksen, Board member: NOK 18 million.
o Kolberg Motors AS (3.85%) and Multiplikator AS (2.39%), being companies
closely associated with Kristian Kolberg, Board member: NOK 11 million.
o Abhijit Saha Banik (0.01%), CFO: NOK 0.5 million.
o SOM Holding AS (4.47%), a company associated with Stein Ove Eriksen,
co-founder and CPO: NOK 6 million.
o Knut Teppan Design AS (0.45%), a company associated with Knut Helge Teppan,
CDO: NOK 0.05 million.
o Vegard Hammer, CTO: NOK 0.05 million.
o HPA Holding AS (1.38%), a company associated with by Håvard Alstad, VP
Engineering: NOK 2 million.
o Korinvest AS (1.53%), a company associated with Jan Tore Korneliussen,
Technical Product Manager: NOK 1.2 million.
o Kvamstad Solutions AS (0.15%), a company associated with Bendik Kvamstad,
Technical Product Manager: NOK 0.215 million.
In relation to the Private Placement, the Company, members of the Board and the
Company's management as well as the pre-committing employees in the Company have
entered into customary lock-up undertakings with the Manager that will restrict,
subject to certain exceptions, their ability to issue, sell or dispose of shares
in the Company, as applicable, for a period of six months from the date hereof
without the prior written consent from the Manager.
Potential Subsequent Repair Offering and equal treatment considerations
Completion of the Private Placement entails a deviation from the preferential
rights of the existing shareholders. When resolving to conduct the Private
Placement, the Board considered this deviation in light of the equal treatment
obligations set out in the Norwegian Private Limited Liability Companies Act,
Euronext Growth Oslo Rule Book - Part II and Oslo Stock Exchange's guidelines on
equal treatment of shareholders. By structuring the Private Placement as a
private placement with a Subsequent Repair Offering, the Company was able to
raise capital in an efficient manner, faster, with a lower discount to the
current trading price and significantly lower completion risks compared to a
rights issue and without the underwriting commissions normally associated with
such rights issues. A fast process with limited costs was particularly important
taking the Company's current financial situation into account. On this basis,
the Board is of the opinion that there are sufficient grounds to deviate from
the preferential rights of the existing shareholders and that the Private
Placement is compliant with the equal treatment obligations.
To mitigate the dilutive effects for the existing shareholders not participating
in the Private Placement, the Board has resolved to propose that the EGM
authorizes the Board to resolve a share capital increase in connection with a
potential subsequent repair offering (the "Subsequent Repair Offering") of up to
250,000,000 new shares in the Company (equal to NOK 25 million) directed towards
existing shareholders in the Company as of 13 December 2024 (as registered in
the VPS two trading days thereafter, i.e. 17 December 2024), who (i) are not
primary insiders in the Company, (ii) do not have a pro-rata share of the
Private Placement which is equal to or higher than the minimum order and
allocation in the Private Placement (approx. 0.8% of the shares outstanding in
the Company), (iii) were not included in the pre-sounding phase of the Private
Placement, (iv) were not allocated Offer Shares in the Private Placement, and
(v) are not resident in a jurisdiction where such offering would be unlawful or
would (in jurisdictions other than Norway) require any prospectus, filing,
registration or similar action (the "Eligible Shareholders"). The subscription
price in the Subsequent Repair Offering will be equal to the Offer Price in the
Private Placement. The Eligible Shareholders will receive non-transferrable
subscription rights in the Subsequent Repair Offering. Over-subscription and
subscription without subscription rights will be allowed.
The Subsequent Repair Offering is subject to (i) completion of the Private
Placement