Vaahto Group has agreed on conditional debt forgiveness with its major creditors and issues shares in a targeted issue
VAAHTO GROUP PLC OYJ STOCK EXCHANGE RELEASE 16 FEBRUARY 2015 at 10:00 am
VAAHTO GROUP HAS AGREED ON CONDITIONAL DEBT FORGIVENESS WITH ITS MAJOR CREDITORS AND ISSUES SHARES IN A TARGETED ISSUE
Vaahto Group has on 16 February 2015 agreed with its major creditors on an arrangement the purpose of which is the strengthening of the company’s financial standing and the securing of the continuance of the company’s operations. At the same time, Vaahto Group issues 10,000,000 new shares at a subscription price of EUR 0.25 per share in a targeted share issue.
By the agreement, the creditors have undertaken to forgive the company’s debts in an amount of EUR 3,850,000, to convert the debts to subordinated capital loans in an amount of EUR 1,175,000 and to grant the company a repayment holiday on such creditors’ receivables until 30 June 2016, each on the condition that a EUR 2,500,000 equity injection is paid to the company’s bank account.
In order to implement the arrangement, the board of directors of the company resolved in its meeting convening on 15 February 2015 on a share issue in which the company offered up to 10,000,000 new shares for subscription. In the share issue, Mikko Laakkonen, HML FINANCE OY and Nemea Credit Opportunities Fund, managed by Nemea Alternative Investment Funds (SICAV) Ltd, subscribed to 3,000,000 shares each and Lombard International SA:n PCP 34443 subscribed to 1,000,000 shares. The subscription price of each share was EUR 0.25. The investors subscribed for all the offered shares.
The subscription price was determined based on negotiations between the company and the investors. In determining the subscription price the financial standing of the company and opportunities for alternative means of financing have been taken into account. Due to the company’s critical liquidity situation and the demands of the company’s creditors, it would not have been possible to continue the company’s operations without an equity injection of at least than EUR 2,500,000. Based on negotiations with investors, it has become clear that it would not have been possible for the company to attract new equity financing on terms more favourable to the company.
It has not been possible for the company to implement a rights issue while retaining its solvency. Thus the continuance of the company’s operations has necessitated implementing the share issue as a targeted share issue. Pursuant to the share issue resolution, the grounds for deviating from the pre-emptive subscription rights of the shareholders were the strengthening of the company’s financial standing and the securing of the continuance of the company’s operations.
The shares shall be paid to the company in cash no later than on 18 February 2015. After having received the subscription payments, the company will file an application to have the shares registered with the Trade Register. The company will apply for the listing of the shares at the latest within one year from the issuance of the shares. In connection with the application, the company will publish a listing prospectus in accordance with the Finnish Securities Market Act and the EU Prospectus Regulation.
In Lahti 16.2.2015
VAAHTO GROUP PLC OYJ
Board of Directors
Reijo Järvinen, Chairman of the Board of Directors Vaahto Group Plc Oyj +358 400 715968