Beyond Frames carries out a directed share issue of approximately SEK 10,2 million

The board of directors of Beyond Frames Entertainment AB (publ) ("Beyond Frames" or the "Company") has on 9 January 2025 resolved to issue 1,000,000 new shares at a subscription price of SEK 10.21 per share in a directed share issue to the existing shareholders Magnus Unger and Calyptra AB (the "Directed Issue"). All investors have entered into subscription undertakings. The net proceeds from the Directed Issue will improve the Company's ability to act on opportunities and supports existing operations, which include the development of a VR game based on the Teenage Mutant Ninja Turtles ("TMNT") intellectual property.

THE DIRECTED ISSUE

The board of directors of Beyond Frames has on 9 January 2025 resolved, pursuant to the authorization granted by the annual general meeting on 28 June 2024, on the Directed Issue of 1,000,000 new shares at a subscription price of SEK 10.21 per share. Through the Directed Issue, the Company will receive gross proceeds of approximately SEK 10,2 million before transaction related costs. The transaction related costs are limited and consist of costs for legal advice and contracting an issuing agent.

The subscription price is SEK 10.21 per share and corresponds to the volume-weighted average price of the Company's share on Spotlight Stock Market during the period from 17 December 2024 up until 7 January 2025, which represents a premium of approximately 0.59 percent from the closing price on 7 January 2025. The subscription price per new share in the Directed Issue has been determined by the board of directors of the Company following arms-length negotiations with the investors based on the current share price of Beyond Frame's shares and is therefore, taking into account the feedback from investors that the Company has received, deemed to correspond to the shares' market value.

The participating investors include the existing shareholders Magnus Unger and Calyptra AB. The participating investors have entered into subscription undertakings.

"We have a strong pipeline of game releases and partnership opportunities between 2024 and 2026. This capital injection supports existing operations in remaining undisrupted." says Ace St. Germain, CEO for Beyond Frames.

BACKGROUND AND REASONS

As Beyond Frames expands, a multitude of high-potential opportunities in the VR landscape is explored. Due to current resource constraints, the ability to capitalize on all partnerships is limited. With the introduced volatility in the internal cash flow forecast calculations for the Company's catalog of titles, due to several market factors, the Company has explored a bridge financing to ensure cash flow stability while bringing their future slate of games to market, including TMNT.

The reasons for deviating from the shareholders' preferential rights are as follows. The Company's board of directors has thoroughly evaluated the option of raising capital through a rights issue and determined that, for several reasons, it is more beneficial for both the Company and its shareholders to pursue capital raising through the Directed Issue. The Company's board of directors has, in preparation of the Directed Issue, contacted both already existing shareholders in the Company, who were been selected on objective grounds, and potential institutional investors and has subsequently decided to direct the issue to already existing shareholders to ensure that the Directed Issue could be carried out on swift and favorable terms for the Company. Whereby on the contrary, a rights issue would have involved a significantly longer execution time, increased costs and complexity and an exposure to potential market volatility considering the volatility that has characterized the market during the previous years compared to the Directed Issue.

The proceeds from the Directed Issue will be used to ensure a stable cash flow while capitalizing on high-potential opportunities in the VR-gaming market which the Company expects will benefit the Company's global competitive position in the VR-gaming market.

Considering the above, the board of directors has concluded that the Directed Issue, deviating from the shareholders' preferential rights, is the most advantageous option for the Company's continued expansion on the global VR-gaming market. Further, the board of directors considers it to be beneficial for the Company's continued development to take advantage of the opportunity to obtain capital for the Company on favorable terms, which is deemed to be in the best interest of the Company's shareholders.

NUMBER OF SHARES AND SHARE CAPITAL

Through the Directed Issue the number of shares and votes outstanding in the Company will increase by 1,000,000 from 17,544,409 to 18,544,409. The share capital will increase by SEK 50,000 from SEK 877,220.45 to SEK 927,220.45. The Directed Issue will entail a dilution of approximately 5.4 percent based on the number of shares and votes in the Company after the Directed Issue.

Through the Directed Issue, Magnus Unger will subscribe for 500,000 shares and Calyptra AB will subscribe for 500,000 shares. As a result of the Directed Issue, Magnus Unger will hold approximately 16.5 percent of the shares and votes in Beyond Frames and Calyptra AB will hold approximately 8.3 percent¹ of the shares and votes in Beyond Frames.

ADVISER

Advokatfirman Delphi has acted as legal adviser to the Company in connection with the Directed Issue.

¹In addition, Calyptra AB's owner Erik Åfors holds an additional 0.1 percent of the shares and votes in the Company through private ownership.

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