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News • December 13, 2024

Huddly AS – Successful completion of private placement

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):

  • Jostein Devold, chair of the Board: NOK 0.5 million.
  • Mertoun Capital AS (7.06%), being a company closely associated with Jostein Devold, chair of the Board: NOK 10 million.
  • Sonstad AS (7.33%), being a company closely associated with Jon Øyvind Eriksen, Board member: NOK 18 million.
  • Kolberg Motors AS (3.85%) and Multiplikator AS (2.39%), being companies closely associated with Kristian Kolberg, Board member: NOK 11 million.
  • Abhijit Saha Banik (0.01%), CFO: NOK 0.5 million.
  • SOM Holding AS (4.47%), a company associated with Stein Ove Eriksen, co-founder and CPO: NOK 6 million.
  • Knut Teppan Design AS (0.45%), a company associated with Knut Helge Teppan, CDO: NOK 0.05 million.
  • Vegard Hammer, CTO: NOK 0.05 million.
  • HPA Holding AS (1.38%), a company associated with by Håvard Alstad, VP Engineering: NOK 2 million.
  • Korinvest AS (1.53%), a company associated with Jan Tore Korneliussen, Technical Product Manager: NOK 1.2 million.
  • 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; (ii) necessary corporate approvals, including the EGM resolving to authorize the Board to issue new shares in the Subsequent Repair Offering and the Board resolving a share capital increase to issue new shares in the Subsequent Repair Offering; (iii) the publication of an offering prospectus pertaining to the Subsequent Repair Offering; and (iv) the prevailing market price and trading volume of the Company's shares following the Private Placement. The Board may decide that the Subsequent Repair Offering will not be carried out if the Company's shares trade at or below the subscription price in the Subsequent Offering (i.e. the Offer Price) at sufficient volumes.

Board composition and reverse stock split

The Board has resolved to propose certain amendments to the Company’s board composition, which (among other) includes a new chairperson. A new extraordinary general meeting (separate from the EGM to be held in connection with the Private Placement) will be held as soon as practicable (early 2025) in order to consummate the proposition. At the same extraordinary general meeting, the Board intends to propose a reverse stock split.

Advisors

Pareto Securities AS is acting as sole manager and bookrunner in connection with the Private Placement.

Advokatfirmaet Simonsen Vogt Wiig AS is acting as legal counsel to the Company.

Contacts

For more information, please contact:

Jostein Devold, chair of the Board, +47 90 88 00 49, jd@mertoun.no

Abhijit Saha Banik, CFO, +47 40 83 09 64, abi.banik@huddly.com

Disclosure

This information is considered to be inside information pursuant to the EU Market Abuse Regulation ("MAR") and is subject to the disclosure requirements pursuant to MAR article 17, Euronext Growth Oslo Rule Book – Part II, section 3.9.1 and section 5-12 of the Norwegian Securities Trading Act. This stock exchange announcement was published by Abhijit Saha Banik, CFO of the Company on 14 December 2024, at 00:30 hours CET.

About Huddly AS

Disruptive innovation is our heartbeat at Huddly. We're committed to pushing technology and challenging the status quo in order to empower human collaboration. Combining our industry-leading expertise in artificial intelligence, software, hardware, and UX, we craft intelligent camera systems that enable inclusive and productive teamwork. Huddly cameras are designed to provide high-quality, AI-powered video meetings on major platforms, including Microsoft Teams, Zoom, and Google Meet. With upgradable software, durable hardware, and engaging user experiences, they are the ideal choice for organizations seeking a future-proof, scalable, and sustainable solution. Founded in 2013, Huddly is headquartered in Oslo, Norway, with presence in the US and EMEA and distribution globally.

Important notice

This announcement is not, and does not form a part of, any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Copies of this announcement are not being made and may not be distributed or sent into any jurisdiction in which such distribution would be unlawful or would require registration or other measures. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions.

The securities referred to in this announcement have not been and will not be registered under the Securities Act, and accordingly may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any part of the offering or their securities in the United States or to conduct a public offering of securities in the United States. Any sale in the United States of the securities mentioned in this announcement will be made solely to QIBs as defined in Rule 144A under the Securities Act, pursuant to an exemption from the registration requirements under the US Securities Act, as well as to "major U.S. institutional investors" as defined in Rule 15a-6 under the United States Exchange Act of 1934, as amended.

In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that EEA Member State within the meaning of the Prospectus Regulation, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State. The expression "Prospectus Regulation" means Regulation 2017/1129 as amended together with any applicable implementing measures in any EEA Member State (also as it forms part of the United Kingdom domestic law by virtue of the European Union Withdrawal Act 2018).

In the United Kingdom, this communication is only being distributed to and is only directed at persons that are (i) 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) high net worth entities, and other persons to whom this announcement may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only for 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 "believe", "expect", "anticipate", "strategy", "intends", "estimate", "will", "may", "continue", "should" 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, the 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 the Company's control.

Actual events may differ significantly from any anticipated development due to a number of factors, including without limitation, changes in investment levels and need for the Company's services, changes in the general economic, political and market conditions in the markets in which the Company operates, the Company's ability to attract, retain and motivate qualified personnel, changes in the Company's ability to engage in commercially acceptable acquisitions and strategic investments, and changes in laws and regulation and the potential impact of legal proceedings and actions. 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 forward-looking statements. The Company does not provide any guarantees that the assumptions underlying the forward-looking statements in this announcement are free from errors nor does it accept any responsibility for the future accuracy of the opinions expressed in this announcement or any obligation to update or revise the statements in this announcement to reflect subsequent events. You should not place undue reliance on any forward-looking statements in this announcement.

The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice. The Company does not undertake any obligation to review, update, confirm, or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this announcement. Neither the Manager nor any of its affiliates make any representation as to the accuracy or completeness of this announcement and none of them accept any responsibility for the contents of this announcement or any matters referred to herein.

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 in the Company. Neither the Manager nor any of its affiliates accept any liability arising from the use of this announcement.

This announcement is an advertisement and is not a prospectus for the purposes of the Prospectus Regulation as amended together with any applicable implementing measures in any EEA Member State (or as it forms part of the United Kingdom domestic law by virtue of the European Union Withdrawal Act 2018), and repealing Directive 2003/71/EC (as amended) as implemented in any Member State.