ChromoGenics acquires machinery equipment and decides on a rights issue of approximately SEK 86 million

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ChromoGenics AB (publ) has entered into an agreement to acquire machinery equipment from the German company Hörmann-Verwertungen GmbH & Co (Hörmann). With the equipment, the company will be able to manufacture its patented foil itself, which ensures increased capacity and quality and reduces production costs. In connection with the transaction, ChromoGenics will carry out a rights issue, subject to approval by an extraordinary general meeting on June 18.

Acquisition of machinery

ChromoGenics AB (publ), org. 556630-1809 has today signed an agreement to acquire sputtering machines from the German company Hörmann. Sputtering is the main process in the production of the patented electrochromic film, which is the foundation of ChromoGenic's all dynamic products. Sputtering is done in special machines where the foil is coated with nanometer thin metal oxide layers in a roll-to-roll process.

Today, sputtering takes place at subcontractors abroad where ChromoGenics rents machine time and the process contains several steps with input materials from different suppliers. The current structure leads to long lead times, not least because there is often a shortage of capacity among the suppliers. And if there is an error at any point, the time is further affected, which in turn can cause delays in the delivery.

Given the increasingly strong demand for the company's products, the risks of using only external suppliers are perceived to be high.

The acquisition is thus carried out in order to secure long-term deliveries and shorten lead times. The investment not only gives ChromoGenic's expanded production and development capacity but also quality control over the entire company's production process. In addition, significant cost savings are also achieved. Existing manufacturing channels will be retained and developed in parallel with their own production to ensure delivery reliability and capacity throughout the world.

The machines will be placed in Uppsala during autumn of 2019 and will be upgraded to ChromoGenic's specific needs in the following months. A letter of intent has also been signed with the Ångström Laboratory for collaboration and joint operation of one development machine, included in the acquisition. The ambition is to have the production machines in operation early spring 2020.

The purchase price amounts to approximately EUR 5.25. The payment is split up and takes place at different times during the delivery and installation process of the machines. Of the purchase price, EUR 1.45 will be paid through newly issued shares in ChromoGenics, at the average price during 10 trading days before the delivery date of the machines.

“We are extremely pleased to be able to land this deal, which is crucial for our volume growth. Through the acquisition, we will not only be able to develop our products further but also gain control of the sputtering, which is one of the real key processes. This is fully in line with our goal of supplying the world market with electrochromic glass and foils and thereby contributing to more sustainable glass solutions”, comments ChromoGenics CEO Jerker Lundgren.

“We are very happy for the deal with ChromoGenics. We believe in ChromoGenics, both as a company and in its technology, and see the great market potential ahead. We have therefore decided to take a significant shareholding in the company in connection with the transaction”, says Markus Hörmann, owner of Hörmann-Verwetungen.

Financing the machine acquisition

In order to finance the acquisition, the Board of ChromoGenics has today decided to issue a new share issue with preferential rights for the Company's existing shareholders (the "Issue"). The decision requires approval from an extraordinary general meeting that is scheduled to take place on June 18, 2019. The press release regarding the notice will be published separately. Since the Company's share capital after the Issue's implementation will be relatively high, the Company is considering at a future General Meeting to decide on a more appropriate share capital.

The rights issue in summary

•  Upon full subscription to the rights issue, the company will be added SEK 86.4 million before issue costs.
•  Through the rights issue, the company's share capital will increase by no more than SEK 34,551,197.83 through the issue of a maximum of 172,755,980 shares.
•  The issue is guaranteed at 85 per cent, of which 1 per cent relates to subscription commitments and 84 per cent refers to guarantee commitments. The guarantors receive market compensation for their guarantee commitments.
•  Anyone who is a shareholder of ChromoGenics on the record date on June 21, has preferential rights to subscribe for shares in the issue, whereby one holding of one (1) share entitles one (1) subscription right. One (1) subscription right entitles the holder to subscribe for one (1) new share at the subscription price SEK 0.50.
•  The subscription period runs from June 25, 2019 through Tuesday, July 12, 2019.
•  The proceeds from the Issue will be used to pay the seller the purchase price for the sputtering machines and to cover the costs for upgrading and some adaptation of the machines and transport to and installation in Uppsala. In addition, there is a buffer for unforeseen events in connection with the acquisition
•  Complete terms and instructions for the rights issue and other information about the company will appear from the prospectus published before the beginning of the subscription period.

Indicative timetable

Advisors
Naventus Corporate Finance AB is a financial advisor in connection with the issue and the law firm Lindahl KB is legal advisor to the Company. Aqurat Fondkommission AB has been appointed as the issuing institution. G&W Fondkommission AB is the Company's Certified Adviser at First North.

About Naventus Corporate Finance AB

Naventus Corporate Finance is an independent, privately-owned financial advisor who offers qualified advice on new introductions, capital acquisitions (equity and debt), change of ownership, acquisitions, mergers and divestments (M&A) to listed and private companies and its owners.

Kontakt
Jerker Lundgren, VD
Lars Ericsson, CFO & Kommunikationschef
Tel: +46 705 497 644

E-mail: info@chromogenics.com

This information is such information that ChromoGenics AB (publ) is required to publish in accordance with the EU Market Abuse Regulation. The information was provided for publication by the contact persons mentioned above [30 May 2019 kl. 14:00 CET].

IMPORTANT INFORMATION

This press release is not an offer to subscribe for shares (in this text, of course, shares as well as other securities) in ChromoGenics and investors shall not subscribe or acquire any securities other than on the basis of the information in the prospectus.

This press release may not be released, published or distributed, directly or indirectly, in or to the United States, Australia, Japan, New Zealand, South Africa, Canada or any other jurisdiction where the distribution of this press release would be illegal. This press release also does not constitute an offer to sell new shares, BTA or subscription rights to any person in a jurisdiction where it would not be permitted to provide such an offer to such person or where such action would require additional prospectus, registration or other measures than according to Swedish law. The prospectus, the application form and other documents relating to the rights issue may not be distributed in or to any country where such distribution or the rights issue requires measures specified in the preceding sentence or where they would conflict with rules in such country.

The new shares, BTA and subscription rights have not been recommended or approved by any US federal or state securities authority or supervisory authority. No new shares, BTA, subscription rights or other securities issued by ChromoGenics have been registered or will be registered in accordance with the United States Securities Act 1933 in force at any time, or under the securities law of any state in the United States. Therefore, no new shares, BTAs, subscription rights or other securities issued by the company may be transferred, exercised or offered for sale in the United States other than in such exceptional cases that do not require registration or through a transaction that is not covered by such registration. There is no intention to register any part of the offer in the US and the securities issued in the rights issue will not be offered to the public in the US.

The Company has not accepted any offer to the public regarding the securities referred to in this press release in any other European Economic Area ("EEA") country than Sweden. Therefore, in other member states of the EEA, the securities can only be offered to (i) a qualified investor as defined in Directive 2003/71 / EC of the European Parliament and of the Council (the "Prospectus Directive") or (ii) someone who falls under Article 3 (2) of the Prospectus Directive.

This press release may only be distributed and directed only to "qualified investors" (as defined in section 86 (7) of the Financial Services and Markets Act 2000) in the United Kingdom and which are (i) professional investors covered by Article 19 (5) of Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 ("Order"), or (ii) persons covered by Article 49 (2) (a) to (d) ("High Net Value Companies" etc.) of the Order (commonly referred to as "relevant persons"). In the UK, such investment or other investment activity referred to in this press release is only available to, and directed only to, relevant persons. Any person who is not a relevant person should not act on the outside or rely on this message or any of its contents.

This press release may contain some forward-looking information that reflects ChromoGenic's current outlook on future events as well as financial and operational developments. Words such as "intended", "coming", "judging", "expecting", "can", "planning", "appreciating" and other expressions that involve indications or predictions regarding future developments or trends constitute forward-looking information. Forward-looking information is inherently associated with known as well as unknown risks and uncertainties because it is dependent on future events and circumstances. Forward-looking information does not constitute a guarantee for future results or development, and actual outcomes may differ materially from what is stated in forward-looking information. This information, the views and the forward-looking statements contained in this press release apply only to this date and are subject to change without notice.

About ChromoGenics
ChromoGenics offers dynamic glass with controllable heat- and light transmission and static glass with world leading performance. The company’s unique technology ConverLight® provides sustainable solar control for increased indoor comfort and energy efficiency. ConverLight also contributes to Green Building certifications. In 2016 the company started commercial sales to real estate projects in Scandinavia.

ChromoGenics is located in Uppsala, Sweden, and the technology is derived from the world leading research center at Ångström Laboratory at Uppsala University. The plant has been partly financed by a conditional loan from the Swedish Energy Agency. ChromoGenics share (CHRO) is listed on Nasdaq First North Stockholm with G&W Fondkommission as Certified Adviser. www.chromogenics.com

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