SaltX resolves on a rights issue of approximately SEK 69 million

The Board of Directors in SaltX Technology Holding AB (publ) (“SaltX” or the “Company”) has today, based on the authorisation from the Annual General Meeting on 25 April 2023, resolved on a new issue of class B shares of approximately SEK 69 million, before deductions of costs attributable with the share issue, with preferential rights for existing shareholders (the “Rights Issue”). The Rights Issue is covered to approximately 87 percent by subscription undertakings and guarantee commitments. The primary purpose of the Rights Issue is to strengthen SaltX’s cash position for continued development and marketing of the Company’s technology for electrification of high-temperature processes. Furthermore, SaltX has entered into an agreement regarding a credit facility from the Company’s two largest shareholders, Industrifonden and SMA Mineral AB.

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Summary

• The Rights Issue is carried out primarily for the purpose of strengthening SaltX’s cash position for continued development and marketing of the Company’s technology for electrification of high-temperature processes.
• Upon full subscription of the Rights Issue, the Company receives approximately SEK 69.0 million before deductions of costs attributable with the Rights Issue, which are expected to amount to approximately SEK 5.3 million.
• The subscription price in the Rights Issue is SEK 1.90 per share.
• Those who, on the record date on 7 September 2023, are shareholders in SaltX, will have preferential rights to subscribe for new shares in the Rights Issue. The last day of trading in SaltX’s shares including the right to receive subscription rights in the Rights Issue is 5 September 2023.
• The Rights Issue comprises a maximum of 36,330,699 class B shares.
• One (1) existing share in SaltX entitle to one (1) subscription right. Ten (10) subscription rights entitle to subscription of three (3) newly issued shares in the Rights Issue.
• The subscription period runs from and including 11 September 2023 up to and including 25 September 2023.
• The Company has received subscription undertakings totalling approximately SEK 21.4 million, corresponding to approximately 31.0 percent of the Rights Issue, from the Company’s two largest shareholders, Industrifonden and SMA Mineral AB.
• The Company has furthermore received guarantee commitments totalling approximately SEK 38.6 million from Industrifonden, SMA Mineral AB and Knil AB (Martin Julander), corresponding to approximately 55.9 percent of the Rights Issue. The Rights Issue is thus covered to approximately 86.9 percent by subscription undertakings and guarantee commitments, corresponding in total to approximately SEK 60.0 million.
• Furthermore, SaltX has entered into an agreement regarding a credit facility from the Company’s two largest shareholders, Industrifonden and SMA Mineral AB.

Background and rationale for the Rights Issue

SaltX has developed technologies that enable both the electrification of high-temperature processes and large-scale energy storage. These areas contribute to and enable a green transition and reduced carbon dioxide emissions. The Company has initiated an industrialization phase and is striving towards a commercialization phase of the technologies. Cooperation agreements have been entered into with SMA Mineral AB for the use of the electrification technology for lime production, as well as with Celsa Armeringsstål AB. Moreover, SaltX has initiated a pre-study together with SMA Mineral AB and SSAB, and has entered into a letter of intent with a leading Indian cement producer with the intention of implementing the technology in their manufacturing process. Contacts have also been established with potential partners and stakeholders in other application areas and geographies as well as for energy storage.

SaltX has, during the winter of 2023, decided to build a demonstration plant to industrialize the electric calcination technology; an investment of approximately SEK 58 million, the costs of which are borne by the Company. The construction is currently ongoing intensively. The facility is significantly larger than the previous development unit and aims to ensure the functionality of the technology on a larger scale. The company's objective is to subsequently deliver commercial facilities. In the demonstration plant, customers and partners will be offered to test the calcination of different materials and recipes, in addition to the work SaltX itself needs to conduct.

The above investment is capital-intensive, and the Rights Issue aims primarily to strengthen the Company's cash position for continued development and marketing of the technology for electrification.

Use of proceeds

Upon full subscription of the Rights Issue, the Company receives approximately SEK 69.0 million before deductions of costs attributable with the Rights Issue, which are expected to amount to approximately SEK 5.3 million. SaltX intends to use the net proceeds from the Rights Issue for the following purposes, without relative order of priority:

• 50 percent is to be used for continued development of SaltX’s technology for the electrification of primarily the lime industry, but also of the cement industry and other industrial processes, as well as to investigate and develop the possibilities of simultaneously capturing CO2.
• 30 percent is to be used for marketing the technology in the above areas.
• 20 percent is to be used for the Company's operating expenses and to expand the Company's organization.

Terms and conditions of the Rights Issue

The Board of Directors in SaltX has today, based on an authorisation from the Annual General Meeting on 25 April 2023, resolved to carry out the Rights Issue.

Those who, on the record date of 7 September 2023, are registered as shareholders in SaltX, will receive one (1) subscription right for each one (1) held share. The subscription rights entitle the holder to subscribe for new shares with preferential rights, whereby ten (10) subscription rights entitle to subscription of three (3) new shares. In addition, investors are offered the possibility to subscribe for shares without the support of subscription rights.

In the event that not all shares are subscribed for with the support of subscription rights, the Board of Directors shall, within the maximum amount of the Rights Issue, resolve on allotment of shares subscribed for without the support of subscription rights, whereby allotment will take place as follows: primarily, allotment shall be made to those who have subscribed for shares with the support of subscription rights, regardless of whether the subscriber was a shareholder on the record date or not, pro rata in proportion to the number of subscription rights exercised for subscription and, to the extent that this cannot be done, by drawing lots; secondly, allotment shall be made to others who have subscribed for shares without the support of subscription rights. In the event that they cannot receive full allotment, allotment shall be made pro rata in proportion to the number of shares subscribed for by each and, to the extent that this cannot be done, by drawing lots; and thirdly and lastly, any remaining shares shall be allotted to the parties who guaranteed the Rights Issue, in proportion to the amount of the guarantee commitments made and, to the extent that this cannot be done, by drawing lots.

The subscription price in the Rights Issue is SEK 1.90 per share. The Rights Issue will, if fully subscribed, raise proceeds of approximately SEK 69.0 million to SaltX before deductions of costs attributable to the Rights Issue, which are expected to amount to approximately SEK 5.3 million.

The record date for participation in the Rights Issue is 7 September 2023. The Company's shares are traded including the right to receive subscription rights up to and including 5 September 2023, and the first day of trading in the shares excluding the right to receive subscription rights is 6 September 2023.

The subscription period runs from and including 11 September 2023 up to and including 25 September 2023. SaltX's Board of Directors has the right to extend the subscription period and the time for payment, which in such case will be announced by the Company via press release no later than 25 September 2023. Trading in subscription rights will take place on the Nasdaq First North Premier Growth Market during the period from and including 11 September 2023 up to and including 20 September 2023, and trading in paid subscribed shares (BTA) will take place on the Nasdaq First North Premier Growth Market during the period from 11 September 2023 up to and including 9 October 2023.

Subscription undertakings and guarantee commitments  

The Company has received subscription undertakings totalling approximately SEK 21.4 million, corresponding to approximately 31.0 percent of the Rights Issue, from the Company's two largest shareholders, Industrifonden and SMA Mineral AB. In addition, the Company has received guarantee commitments amounting to a total of approximately SEK 38.6 million from Industrifonden, SMA Mineral AB and Knil AB (Martin Julander), corresponding to approximately 55.9 percent of the Rights Issue. The Rights Issue is thus covered to approximately 86.9 percent by subscription undertakings and guarantee commitments, corresponding in total to approximately SEK 60.0 million. In the event that the Rights Issue is subscribed for more than 86.9 percent, the guarantee commitments will not be called upon. Neither the subscription undertakings nor the guarantee commitments are secured by bank guarantee, escrow funds, pledging or similar arrangements.

For the guarantee commitments, a guarantee commission of 14 percent of the guaranteed amount will be paid in the form of newly issued class B shares in the Company, at a subscription price of SEK 1.90 per share, which corresponds to the subscription price per share in the Rights Issue. The guarantee commission and the subscription price have been determined through negotiations at arm's length between the Company and the parties providing the guarantee commitments. The Board of Directors therefore makes the assessment that the terms have been determined in such a way that market fairness has been ensured and that the terms reflect prevailing market conditions. The guarantee commission will be paid regardless of whether the guarantee commitments are called upon. No commission is paid for submitted subscription undertakings.

Additional information about the parties that have submitted the subscription undertakings and guarantee commitments will be included in the prospectus that will be published in connection with the Rights Issue.

Credit facility

In order to ensure that the Company's working capital is sufficient until the Rights Issue is completed, the Company has entered into an agreement regarding a credit facility from Industrifonden and SMA Mineral AB (the "Credit Facility"). The Credit Facility gives the Company the right to, upon request, receive a loan of approximately SEK 21.4 million which falls due on 31 January 2024. Any loan disbursed under the Credit Facility shall carry an annual interest rate of 15 percent. In the event the Company uses the Credit Facility before the Rights Issue has been completed, Industrifonden and SMA Mineral AB shall be able to make payment for shares subscribed by them in the Rights Issue by way of set-off against claims on the Company under the Credit Facility.

Shares and share capital

Provided that the Rights Issue is fully subscribed, the Company's share capital will increase by SEK 2,906,455.92, from SEK 9,688,186.72 to SEK 12,594,642.64 through a new issue of 36,330,699 shares of class B, which entails that the total number of shares in the Company will increase from 121,102,334 to 157,433,033, corresponding to a dilutive effect of approximately 23.1 percent for shareholders choosing not to participate in the Rights Issue. Shareholders have the possibility to be financially compensated for the dilutive effect by selling their subscription rights. Unexercised subscription rights must be sold no later than 20 September 2023 in order to not expire without value. The company has not issued any class A shares.

The new share issue of class B shares to be issued as guarantee commission (the “Compensation Issue”) will result in an increase of the Company’s share capital by an additional SEK 227,494.64 through issuance of 2,843,683 class B shares, corresponding to a dilutive effect of approximately 2.3 percent (based on the number of shares in the Company before the Rights Issue).

The total dilutive effect upon a fully subscribed Rights Issue and completion of the Compensation Issue amount to approximately 24.4 percent.

Prospectus

Complete information regarding the Rights Issue and information about the Company will be included in a prospectus, expected to be published on or around 7 September 2023.

Preliminary timetable for the Rights Issue

Advisors

ABG Sundal Collier AB acts as financial advisor and Törngren Magnell & Partners Advokatfirma KB acts as legal advisor to SaltX in connection with the Rights Issue. Nordic Issuing acts as issuing agent in connection with the Rights Issue.

For more information, please contact:

Carl-Johan Linér, CEO +46 70 532 08 08
cj.liner@saltxtechnology.com
Harald Bauer, CFO +46 70 810 80 34
harald.bauer@saltxtechnology.com

This information is information that SaltX Technology Holding AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, on 30 August 2023, at 08:30 CEST. 

About SaltX

SaltX Technology is a Swedish Greentech company that develops and markets sustainable technology that benefits customers, the climate, and society. The company operates in large-scale energy storage solutions and electrification technology for mainly the lime and cement industry. SaltX Technology's share is listed on the Nasdaq First North Premier Growth Market. For more information, visit www.saltxtechnology.com.

FNCA Sweden AB, +46 8-528 00 399, info@fnca.se, is SaltX Technology's Certified Advisor.

IMPORTANT INFORMATION

The information in this press release does not constitute an offer to acquire, subscribe for or otherwise trade with shares, paid subscribed shares, subscription rights or other securities in SaltX in any jurisdiction. An invitation to eligible persons to subscribe for shares in SaltX will only be made through the prospectus which SaltX intends to publish following the approval and registration thereof by the Swedish Financial Supervisory Authority.

The information in this press release may not be released, published, copied, reproduced or distributed, directly or indirectly, within or into the United States of America (including its territories and possessions, any state of the United States and the District of Columbia, the “USA”), Australia, Belarus, Canada, Hong Kong, Japan, New Zealand, Russia, Switzerland, Singapore, South Africa or any jurisdiction where doing so might be unlawful, subject to legal restrictions or require other actions than the ones prescribed under Swedish law. Actions in violation of these instructions may constitute a breach of applicable securities law.

This press release does not constitute an offer or invitation to acquire or subscribe for shares or other securities in the USA. No shares, subscribed shares, subscription rights or other securities issued by the Company (the “Securities”) have been, nor will they be, registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”) or the securities laws in any other state or jurisdiction in the USA, and no Securities may be offered, subscribed, used, pledged, sold, retailed, delivered or transferred, directly or indirectly, in or into the USA other than pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the USA. The Securities have not been and will not be approved or registered by the Securities and Exchange Commission, any state securities authority or other authority in the USA. No such authority has assessed or made any statements about the Rights Issue or the accuracy or reliability of the prospectus. To assert the contrary is a criminal act in the USA.

This press release is not a prospectus for the purposes of Regulation (EU) 2017/1129 (the “Prospectus Regulation”) and has not been approved by any regulatory authority in any jurisdiction.

In the United Kingdom, this document and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, “qualified investors” (within the meaning of the United Kingdom’s version of the EU Prospectus Regulation (2017/1129/ EU) which is part of United Kingdom’s law by virtue of the European Union (Withdrawal) Act 2018) who are (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.

This press release does not identify, or purport to identify, risks (direct or indirect) that may be associated with an investment in Securities. Any investment decision to acquire or subscribe for Securities in connection with the Rights Issue must be made only on the basis of the prospectus to be published in connection with the Rights Issue.

Matters discussed in this press release 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”, “intends”, “estimate”, “will”, “may”, “continue”, “should” and similar expressions. The forward-looking statements in this press 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, these 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. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this press release by such forward-looking statements.