ABT presentationNOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN OR INTO THE United States, Canada, Australia, Japan or Hong Kong OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER TO BUY, SELL OR SUBSCRIBE FOR ANY SECURITIES DESCRIBED HEREIN.
Aqua Bio Technology ("ABT" or the "Company") is pleased to announce that it has received binding pre-commitments to subscribe for 4,610,000 new shares (the "New Shares") for gross proceeds of NOK 11.525 million in a conditional private placement of minimum NOK 10.5 million and maximum NOK 15 million (the "Private Placement"). The board of directors of the Company (the "Board") will also propose a repair issue.
The Board has also decided to make certain changes in the Company's management team to increase focus on sales and marketing efforts for the Company's product offering. Going forward, current CEO Arvid Lindberg will function as Head of Sales and Marketing and Espen Kvale will function as interim CEO through a consultancy agreement with Espen Kvale Consulting LLC. These changes will come into effect as soon as possible.
The Private Placement
The Private Placement is directed towards the Company's 140 largest existing shareholders as of 4 December 2018, as registered in the Company's shareholder register in the VPS on 6 December 2018 (the "Record Date") and the Company's board of directors and key management (the "Eligible Investors"), however limited upwards to 149 investors in total. Eligible Investors that wish to participate in the Private Placement must contact the Company at arvid@aquabiotech.no in the period between 5 December 2018 at 09.00 CET until 3 January 2019 at 16.30 CET.
The subscription price in the Private Placement has been set to NOK 2.50 per New Share. Each investor in the Private Placement will also receive one (1) warrant ("Warrant") per New Share subscribed and allocated in the Private Placement. Each Warrant shall give the right to require issuance of one additional share in the Company in the period between from and including 30 June 2019 to and including 1 September 2019 against a cash deposit of NOK 2.50 per share.
Allocation of New Shares to Eligible Investors will be determined by the Company's board of directors on or about 4 January 2019. The number of New Shares to be allocated to the Company's board of directors and key management, and the allocation thereof, shall be made at the sole discretion of the Company's board of directors. The remaining New Shares may be allocated to the Eligible Investors up to a number of New Shares which equals to a factor of their existing proportional shareholding and the total number of New Shares to be allocated to the Eligible Investors. Shareholders that have pre-committed to subscribe for New Shares for NOK 11.525 million, will on a pro rata basis (based on their subscription commitment) have a preferential right to subscribe for New Shares that are not subscribed for in the Private Placement. If such shares are not allocated, then they may be allocated to other Eligible Investors based on their proportional shareholding.
The net proceeds from the Private Placement will be used for general purposes and working capital related to the Company's products in its markets of operation, as further described in the enclosed Company presentation dated 3 December 2018.
As the subscription price in the Private Placement is lower than the current par value of the Company's shares, the board of directors (the "Board") will propose to carry out a share capital reduction (the "Share Capital Decrease") in order to reduce the par value of the Company's shares to NOK 2.50.
The Company's obligation to complete the Private Placement is conditional upon the following:
The EGM will be held on or about 7 January 2019. A notice for the EGM will be distributed in due course.
The New Shares will be delivered to the investors in the Private Placement on a separate ISIN as soon as practically possible after the registration of the share capital increase pertaining to the Private Placement, expected on or about 16 January 2019. The New Shares will be converted to the ordinary ISIN of the Company's shares following approval and publication of a prospectus, expected in February 2019 (the "Prospectus").
The Private Placement constitutes a deviation from the preferential right of the shareholders to subscribe for the New Shares. The Board, together with the Company's management, has considered various transaction alternatives to secure new financing. Based on an overall assessment, taking into account inter alia the need for funding, execution risk and possible alternatives, the Board has on the basis of careful considerations decided that the Private Placement is the alternative that best protects the Company's and the shareholders' joint interests. Thus, the deviation of the preferential rights inherent in a share capital increase through issuance of New Shares is considered necessary.
The Repair Issue
In order to reduce the dilution resulting from the issuance of the New Shares, the Board intends to launch a repair issue (the "Repair Issue") of new shares (the "Offer Shares") at a subscription price of NOK 2.50 per Offer Share (i.e. the same subscription price as for the New Shares). Eligible Shareholders (as defined below) who subscribe for Offer Shares will also receive one (1) Warrant per Offer Share subscribed for.
The Repair Issue will be directed towards the Company's shareholders as of the Record Date, less (i) shareholders who were offered to participate in the Private Placement, and (ii) shareholders who are resident in a jurisdiction where such offering would be unlawful or would require any filing, registration or similar action (the "Eligible Shareholders"). The subscription period in the Repair Issue will commence shortly after approval and publication of the Prospectus, and relevant information (including size) about the Repair Issue will be given in due course. The Repair Issue and the issuance of Warrants to Eligible Shareholders who subscribe for Offer Shares will inter alia require approval by the EGM and publication of the Prospectus.
The shareholders that have pre-committed to subscribe for New Shares for NOK 11.525 million, will on a pro rata basis (based on their subscription commitment), have a preferential right to subscribe for offered shares that are not subscribed for in the Repair Issue. If such shares are not allocated, then they may be allocated to other Eligible Shareholders based on their proportional shareholding.
Certain major shareholders, includingbut not limited to closely related companies and related persons of three of the board members and the five largest shareholders, corresponding to 55.02 % of the shares and votes in the Company, have given irrevocable voting undertakings to vote in favor of the Share Capital Decrease, the Private Placement, the issuance of the Warrants, and an authorization to complete a Repair Issue at the EGM.
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Major shareholders and members of the Company's board that has pre-committed to subscribe for New Shares include:
Formal primary insider notifications will be published following allocation of the New Shares.
A Company presentation dated 3 December 2018 that have been distributed to the investors who have pre-committed to subscribe for New Shares in the Private Placement is enclosed to this stock exchange notice.
For further information, please call Arvid Lindberg, CEO, telephone +47 9824 5410 or arvid@aquabiotech.no.
Aqua Bio Technology (ABT) has launched several cosmetic ingredients used in skin care products globally. Skin care is the fastest growing segment in the cosmetics industry, where ABT's ingredients have established a foothold. In addition to ingredients from its own technology, ABT also commercializes novel technologies/ingredients for partners, for use in skin care products. Aqua Bio
Technology is listed on the Axess market of the Oslo Stock Exchange.
This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
IMPORTANT INFORMATION
This communication may not be published, distributed or transmitted in the United States, Canada, Australia, Japan or Hong Kong. These materials do not constitute an offer of securities for sale or a solicitation of an offer to purchase securities of the Company in the United States or any other jurisdiction. The securities of the Company may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"). The securities of the Company have not been, and will not be, registered under the U.S. Securities Act. Any sale in the United States of the securities mentioned in this communication will be made solely to "qualified institutional buyers" as defined in Rule 144A under the U.S. Securities Act. No public offering of the securities will be made in the United States.
In any EEA Member State that has implemented the Prospectus Directive, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State. The expression "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including Directive 2010/73/EU, to the extent implemented in any relevant Member State) and includes any relevant implementing measure in the relevant Member State.
In the United Kingdom, this communication is only addressed to and is only directed at Qualified Investors who (i) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order") or (ii) are persons falling within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations, etc.) (all such persons together being referred to as "Relevant Persons"). These materials are directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this announcement relates is available only to Relevant Persons and will be engaged in only with Relevant Persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.
Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as "anticipate", "believe", "continue", "estimate", "expect", "intends", "may", "should", "will" and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice.
This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. Neither the Managers nor any of their respective affiliates accepts any liability arising from the use of this announcement.
The Company expressly disclaims any obligation or undertaking to update, review or revise any statement contained in this announcement whether as a result of new information, future developments or otherwise.
The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions.