Savosolar announces plan to arrange rights issue o

Savosolar Plc Company Announcement            21 May 2018 at 9:00 (CEST)

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Savosolar announces its plan to arrange a rights issue of approximately EUR 3.5 million and discloses financial information for the period 1 January - 31 March 2018

The Board of Directors of Savosolar Plc ("Savosolar" or the "Company") has decided to arrange a partially underwritten rights issue totalling approximately EUR 3.5 million (the "Offering") with additional warrants enabling the Company to raise up to a maximum of approximately EUR 3.3 million (the "Warrants"), under the condition that the Extraordinary General Meeting to be summoned today gives authorization 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 174,332,085 new shares (the "Offer Shares"). The Offer Shares would constitute approximately up to 57.1 per cent of all shares in the Company should the Offering be fully subscribed. New information regarding financials of the Company for the period 1 January - 31 March 2018 has also been released.

Summary of the Offering

• The Company sees that the market has finally become active again, signing its first large order outside Denmark and winning its largest tender to date in Denmark. However, due to the temporary downturn in the market, the Company is in need of working capital.
• 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. Three (3) Subscription Rights entitle the holder to subscribe for four (4) Offer Shares.
• The subscription price is expected to be EUR 0.02 per Offer Share. The subscription price includes a discount of approximately 66.1 per cent compared to the current share price.
• The record date for the Offering is planned to be 18 June 2018 with the last day of trading including the Subscription Rights on 14 June 2018 and the first day of trading excluding the Subscription Rights on 15 June 2018.
• The subscription period for the Offer Shares (the "Subscription Period") is expected to commence on 21 June 2018 at 09:30 Finnish time (08:30 Swedish time), and it is expected to end on 10 July 2018 at 16:30 Finnish time (15:30 Swedish time) in Finland and on 6 July 2018 in Sweden at 16:30 Finnish time (15:30 Swedish time).
• Augment Partners AB ("Augment Partners") has received a mandate to acquire professional investors for the Company during the Subscription Period of the Offering, so that the investments received through them is a maximum of approximately EUR 0.9 million (the "Directed Issue"). Investors who are procured by Augment Partners will primarily take part in the Offering, and additionally a separate directed issue to them can be arranged with the same Subscription Price, if the Offering is fully subscribed. The number of shares to be issued in the possible Directed Issue would amount to maximum of 43,583,021 shares, i.e. approximately 12.5 per cent of the total amount of shares in the Company after the Offering and the possible Directed Issue, assuming that the Offering and the possible Directed Issue are both fully subscribed. The Board of Directors shall decide on the possible Directed Issue approximately on 13 July 2018, while resolving on approval of the subscriptions received in the Offering.
• In addition, Savosolar is planning to offer each subscriber of the Offer Shares one (1) warrant (the "Warrant") free of charge for every two (2) Offer Shares subscribed and paid for in the Offering, the subscription of which the Board of Directors has approved. Savosolar is planning to make a similar offer also to investors who will participate in the possible Directed Issue. Each Warrant would entitle its holder to subscribe for one (1) new share in the Company during the time period between 26 November 2018 - 10 December 2018. The subscription price for the shares subscribed based on the Warrants will be defined based on volume weighted average price of the Company's shares in First North Finland during the time period between 12 November 2018 - 23 November 2018 with a discount of 25 per cent. However, the subscription price shall not be less than EUR 0.02 per share nor higher than EUR 0.03 per share. The maximum number of Warrants would be 87,166,043 if the Offering is fully subscribed, and 108,957,553 if both the Offering and Directed Issue are fully subscribed.
• Approximately EUR 3.5 million before the transaction costs is expected to be raised in the Offering if the Offering is fully subscribed and additionally approximately EUR 0.9 million before the transaction costs in the Directed Issue if the Directed Issue is arranged and fully subscribed. A maximum of approximately EUR 3.3 million will be raised through the Warrants if the maximum number of Warrants is issued and if all the Warrants are used for subscription of new shares at the maximum subscription price of EUR 0.03 per share.
• The Offering is secured to 80 per cent by current shareholders and external underwriters. The external underwriters are entitled to receive their underwriting compensation either in cash or in new shares of the Company by setting off the underwriting compensation against the subscription price of the new shares in a directed share issue to be conducted after the Offering, if necessary.

Reasons for the Offering and use of proceeds

Until recently, Denmark was the only active market in the segment for large solar collector fields and systems. Even though market analysts predicted that new markets both in Europe and elsewhere would be activating earlier, it was not until 2017 that Savosolar started seeing real activity in other markets. With Savosolar's award-winning products and due to the intensified sales actions in the past 18 months, the Company has been invited to almost all notable tenders in Europe, signing its first large-scale order outside Denmark and winning its largest tender ever during the spring 2018. The order, with a collector area exceeding 4,000 m ² to newHeat SAS will be the largest solar thermal field ever built in France and first in the world installed on a one-axis tracking system. The tender won by the Company in Denmark, with a total collector area of approximately 20,000 m ² to Grenaa Varmevaerk, is worth approximately EUR 3.0 million  and would be the Company's largest order to date.

This means, that after many years of proving its technology to the market and signing orders on the competitive Danish market, Savosolar has finally been able to take a leap forward towards its vision of becoming the global first-choice supplier to high performance solar installations. While delivering to large collector fields in Europe as well as with strong partnerships around the world, e.g. in China, Latin America, Australia and Africa, the Company believes it is ready to take on the global market.

Due to the temporary downturn because of the Danish government's delayed decisions of the terms concerning renewable energies and longer-than-expected processing times in other markets since the end of 2016, the Company is in need for more working capital.

The Company aims to raise approximately EUR 3.5 million through the Offering and may raise additionally approximately EUR 0.9 million through the Directed Issue if the Directed Issue is arranged and fully subscribed. The Warrants would enable the Company to raise additionally up to approximately EUR 3.3 million if the maximum number of Warrants is issued and if all the Warrants are used for subscription of new shares at the maximum subscription price of EUR 0.03 per share.

The proceeds from the Offering will be used for working capital so that the Company can deliver signed and upcoming orders in 2018-2019 and continue to streamline Savosolar's operations to match profitability targets and the increasing demand globally.

Financial information that has not been published before (unaudited)

INCOME STATEMENT

BALANCE SHEET

ASSETS

EQUITY AND LIABILITIES

The Offering

The size of the contemplated Offering will be approximately EUR 3.5 million. The Offering has been secured to 80 per cent.

The Board of Directors of the Company is planning to offer up to 174,332,085 new shares in the Company for subscription in accordance with the shareholders' preferential subscription right, under the condition that the Extraordinary General Meeting to be summoned today gives authorization to the Board of Directors to resolve on the Offering and the issuance of Warrants. 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 approximately 18 June 2018. Each three (3) Subscription Rights would entitle their holder to subscribe for four (4) 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 approximately on 19 June 2018 and in the book-entry system maintained by Euroclear Sweden approximately on 20 June 2018. The Subscription Rights are planned to be freely assigned and they are expected to be traded on First North Finland and First North Sweden between 21 June and 4 July 2018.

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 30, 2018. Trading in the Temporary Shares is planned to commence on First North Finland and on First North Sweden as their own special share class approximately on 21 June 2018. The Temporary Shares will be combined with the Company's current shares after the Offer Shares have been registered into the Trade Register. The combination is planned to take place approximately during week 30, 2018 and the Offer Shares are planned to be subject to trading together with the Company's existing shares on First North Finland approximately during week 30, 2018 and on First North Sweden approximately during week 31, 2018.

Planned timetable for the Offering       

Advisers

Augment Partners 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.

For more information:

Savosolar Plc Managing Director Jari Varjotie Phone: +358 400 419 734 E-mail: jari.varjotie@savosolar.com

This company announcement contains information that Savosolar Plc is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication by aforementioned contact person on 21 May 2018 at 9:00 a.m. (CEST).

Savosolar in brief

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 17 countries on four continents. Savosolar's shares are listed on Nasdaq First North Sweden with the ticker SAVOS and on Nasdaq First North Finland with the ticker SAVOH. www.savosolar.com .

The company's Certified Adviser is Augment Partners AB, phone: +46 8-505 65 172.

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.