Savosolar plans to arrange a rights issue of approximately 4.3 MEUR with additional warrants

Savosolar Plc

Company Announcement, Insider information    17 April 2020 at 8.45 a.m. (CEST)

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Savosolar plans to arrange a rights issue of approximately 4.3 MEUR with additional warrants

The Board of Directors of Savosolar Plc ("Savosolar" or the "Company") has decided to arrange a partially underwritten rights issue totaling approximately EUR 4.3 million (the "Offering") with three series of additional warrants enabling the Company to raise up to a maximum of approximately EUR 13.0 million (the "Warrants"), under the condition that the Annual General Meeting to be held on 27 April 2020 gives authorisation to the Board of Directors to resolve on the Offering and the issuance of Warrants. The Offering is expected to consist of a maximum of approximately 28,978,541¹ new shares (the "Offer Shares"). In addition, maximum of approximately 43,467,812¹ new shares could be subscribed based on the Warrants.

Summary

• Approximately EUR 4.3 million before transaction costs is expected to be raised in the Offering if fully subscribed. In case maximum number of Warrants is issued and all the Warrants are used for subscription of shares, the contribution from Warrants will amount to EUR 13.0 million at most.
• The Offering is secured to 80 per cent by subscription commitments and external underwriters. All members of the Company's Board of Directors and the Company's CEO and CFO have entered into subscription commitments in the Offering.
• Savosolar is planning to give all its shareholders registered in Savosolar's shareholder register maintained by Euroclear Finland Ltd ("Euroclear Finland") or Euroclear Sweden AB ("Euroclear Sweden") one (1) book-entry subscription right (the "Subscription Right") for every one (1) share held on the Offering record date. Two (2) Subscription Rights entitles the holder to subscribe for three (3) Offer Shares.
• The record date for the Offering is planned to be 27 May 2020 with the last day of trading including the Subscription Rights on 25 May 2020 and the first day of trading excluding the Subscription Rights on 26 May 2020.
• The subscription price is expected to be 0.15¹ EUR per Offer Share. The subscription period for the Offer Shares (the "Subscription Period") is expected to commence on 1 June 2020 at 09:30 Finnish time (08:30 Swedish time), and it is expected to end on 17 June 2020 at 16:30 Finnish time (15:30 Swedish time) in Finland and on 15 June 2020 in Sweden at 16:30 Finnish time (15:30 Swedish time).
• In addition, Savosolar intends to offer each subscriber of the Offer Shares one (1) newly issued warrant of series TO5, one (1) newly issued warrant of series TO6 and one (1) newly issued warrant of series TO7 for each two (2) shares subscribed and paid for in the Offering.
• Each warrant will entitle its holder to subscribe for one (1) new share during the subscription period 9 – 20 November 2020 (for TO5), 8 – 19 March 2021 (for TO6) and 6 – 17 September 2021 (for TO7) respectively, with a subscription price that will be decided based on the volume weighted average price of the Company’s shares in First North Growth Market Finland for ten (10) business days prior to the warrant’s subscription period with a 30 % discount, at a maximum subscription price of EUR 0.30¹ per share.
• Net proceeds from the Offering and the Warrants will secure the Company's working capital needs and provide to  the Company’s financial capacity to increase its capability to deliver large solar heating systems in a growing market demand both in district heating and industrial process heating segments.

Reasons for the Offering and use of proceeds

The market for large solar heating systems is very active, both in terms of district heating and heat production for industrial processes. The most active markets in Europe are Germany and France, and in both the Company has achieved a strong market position and brand. The Company currently has nine projects in the final bidding phase, of which more than half are in these two countries. In France, Savosolar has achieved clear market leader position as a result of both the Company's efficient and high-quality technology and its local and customer-oriented way to operate. In addition, there are projects elsewhere, which shows that the market continues to develop positively in various countries, such as China, where the first project is expected to take place this year.

The well-respected German BDI (Bundesverband der Deutschen Industrie) has made a study for the Government of Berlin, according to which, in 2030 the solar district heating production should be 9 TWh annually in order to meet targets set for clean heating. This translates into one million square meters of new capacity of solar thermal collectors for district heating in Germany each year for the next ten years. Even if not reaching this level immediately, the German cities and district heating companies have reacted to these targets – and the market situation is better than ever before. At the same time, thanks to systematic efforts by the government and project developers, France is currently the most active market for large solar thermal systems in Europe, which is also reflected in orders received by Savosolar. China is talking about building 4 million square meters of solar heat each year, and the largest growth is expected to come from large-scale systems.

Savosolar has established a strong brand as a reliable supplier of large solar heating systems, and the company's total number of systems already exceeds 100,000 m², which demonstrates Savosolar's ability to supply value-added energy plants to customers. The market is growing globally with the ever-accelerating demand for clean energy production, and recent changes in the competitive situation open up ever greater opportunities for the Company to increase market share by being the technology and quality leader in the industry and via the references in which the customers are highly satisfied. The Company wants and needs to meet the growing market demand and therefore the Company plans to arrange the above mentioned capital raising.

Savosolar intends to use the net proceeds from the Offering and the Warrants for the following:

• Meet the Company's working capital needs and increase, in a growing market, the Company's financial capacity to deliver signed and future orders and increase its ability to meet the growing market demand for large solar thermal systems in both industrial processes and district heating segments.
• To further strengthen the Company's technology and quality leadership in solar thermal collector technology with additional features to the product and offering that further improve Company’s competitiveness.

Terms of the Offering

The Board of Directors of the Company is planning to offer up to approximately 28,978,541 Offer Shares and Warrants amounting to approximately 14,489,271 of three different series (in total maximum of approximately 43,467,812 Warrants) for subscription in accordance with the shareholders' preferential subscription rights, under the condition that the Annual General Meeting to be held on 27 April 2020 gives authorization to the Board of Directors to resolve on the Offering and the issuance of Warrants. The main terms for the Offering are presented below.

• All shareholders registered in Savosolar's shareholder register maintained by Euroclear Finland or Euroclear Sweden are planned to be given one (1) book-entry Subscription Right for every one (1) share held in the Company on the Offering record date, which is planned to be 27 May 2020. Each two (2) Subscription Rights will entitle their holder to subscribe for three (3) Offer Shares.
• The Subscription Rights are planned to be registered in the shareholders' book-entry accounts in the book-entry system maintained by Euroclear Finland and Euroclear Sweden approximately on 1 June 2020.
• The Subscription Rights are planned to be freely assigned and expected to be traded on First North Growth Market Finland and First North Growth Market Sweden between 1 June 2020 and 11 June 2020.
• After the subscription, temporary shares corresponding to the Offer Shares subscribed for based on the Subscription Rights (the "Temporary Shares") will be entered into the subscriber's book-entry account.
• The Offer Shares will be entered into the subscriber's book-entry account once they have been entered into the Trade Register, approximately during week 27, 2020.
• Trading in the Temporary Shares is planned commence on First North Growth Market Finland and on First North Growth Market Sweden as their own special share class approximately on 1 June 2020.
• The Temporary Shares will be combined with the Company's current shares after the Offer Shares have been registered in to the Trade Register.

Subscription commitments and underwriters

The size of the contemplated Offering will be approximately EUR 4.3 million. The Offering has been secured to 80 percent through subscription commitments and underwriters. All members of the Company's Board of Directors and the Company's CEO and CFO have entered into subscription commitments in the Offering. External underwriters are entitled to receive their underwriting compensation either in cash amounting to twelve (12) per cent of underwritten amount, or the equivalence of fourteen (14) per cent of the underwritten amount in new shares by setting off the underwriting compensation against the subscription price in a directed issue to be arranged if needed after the Offering.

Indicative timetable

Advisers

Augment Partners AB is acting as financial advisor to the Company in the Offering. Smartius Oy is acting as the legal adviser to the Company on aspects of the Offering related to the Finnish law.

SAVOSOLAR PLC

For more information:

Savosolar Plc

Managing Director Jari Varjotie

Phone:  734

E-mail:

Savosolar Plc discloses the information provided herein pursuant to the Market Abuse Regulation ((EU) No 596/2014, ”MAR”). The information was submitted for publication by the aforementioned person on 17 April 2020 at 8.45 a.m. (CEST).



About Savosolar

Savosolar with its highly efficient collectors and large-scale solar thermal systems has taken solar thermal technology to the next level. The company’s collectors are equipped with the patented nano-coated direct flow absorbers, and with this leading technology, Savosolar helps its customers to produce competitive clean energy. Savosolar’s vision is to be the first-choice supplier to high performance solar installations on a global scale. Focus is on large-scale applications like district heating, industrial process heating and real estate systems – market segments with a big potential for rapid growth. The company primarily delivers complete systems from design to installation, using the best local partners. Savosolar is known as the most innovative company in the business and aims to stay as such. The company has sold and delivered its products to almost 20 countries on four continents. Savosolar’s shares are listed on Nasdaq First North Growth Market Sweden with the ticker SAVOS and on Nasdaq First North Growth Market Finland with the ticker SAVOH. .

The company’s Certified Adviser is Augment Partners AB, , phone:  172.

IMPORTANT NOTICE

This release or the information contained therein shall not be distributed, directly or indirectly, in Australia, Canada, Hong Kong, Japan, New Zealand, Singapore, South Africa or the United States. The information contained in this release do not constitute an offer of, or invitation to purchase any securities in any area, where offering, procurement of or selling such securities would be unlawful prior to registration or exemption from registration or any other approval required by the securities regulation in such area. This release is not an offer for sale of securities in the United States. Securities 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, and the rules and regulations issued by virtue of it. Savosolar has not registered, and does not intend to register, any offering of securities in the United States. No actions have been taken to register the shares or the offering anywhere else than in Finland and Sweden.

The information contained herein shall not constitute an offer of, or invitation to purchase any securities in any jurisdiction. This release is not a prospectus and does not constitute any offer, invitation or investment advice to subscribe for or purchase securities. Investors should not subscribe for or purchase any securities or make any investment decisions referred to herein except on the basis of information contained in a prospectus issued by Savosolar.

¹ Number of shares and the subscription price are calculated based on the assumption that the Annual General Meeting to be held on 27 April 2020 approves the proposed reverse split of 1:100.