Hoylu AB (publ) carries out a SEK 34.6 million convertible notes issue and has been requested to call for an EGM to resolve on an additional SEK 37 million convertible notes issue to board members and executives

The board of directors of Hoylu AB (publ) (“Hoylu” or the “Company”) has, with support of authorization granted by the annual general meeting on 10 June 2022, carried out a directed issue of convertible loan notes corresponding to a value of SEK 34.6 million of which approx. SEK 5.4 million has been paid in cash and SEK 29.2 million by set-off. Furthermore, the Company’s shareholder Alden AS, representing 14.9 per cent of the shares in the Company, has requested that an extraordinary general meeting shall be summoned to resolve on a directed issue of convertible loan notes of approx. SEK 37 million, SEK 6.6 million will be paid in cash and SEK 30.4 million by set-off, towards members of the board of directors, executives, and there to related parties. Notice convening the extraordinary general meeting for resolution on the directed issue will be announced through a separate press release.

Convertible notes issue resolved by the board of directors

The right to subscribe for convertible loan notes in the directed issue resolved by the board of directors is vested in Alden AS, Andreas Martinussen, Anglo Invest AS, Bimo Kapital AS, Camelback Eiendom AS, Camelback Holding AS, Erling Johnsen A/S, Frenisa AS, Helling Invest AS, Karl-Erik Staubo, KES AS, Libert AS, Navesta AS, Norse AS, Norse Partners AS, Nucleus Life AG, OnteTwo3 AS, Staco AS, Torsen Tankers & Towers AS (the “Subscribers”). Prior to the directed issue of convertible notes, the board of directors did consider the possibility of raising capital through a rights issue but concluded that a rights issue would be significantly more time consuming and entail significantly higher costs and increased exposure to potential market volatility compared to a directed issue. Furthermore, it is considered that the current stock market climate makes it likely that, in the case of a rights issue, the issue would not be subscribed to the required extent and that guarantee commitments would therefore have to be procured to ensure that the Company is provided with sufficient capital, which in turn risks entailing additional costs and/or further dilution depending on the type of consideration paid for such a guarantee subscription. Other options, including the raising of a long-term loan, have also been considered but were either considered too costly or would not provide sufficient working capital and were therefore not considered to be in the best interests of the Company or its shareholders. In view of the above, the board of directors has considered that a directed convertible notes issue on the proposed terms is the most advantageous for the Company and its shareholders, especially in view of the Company's need for immediate financing to clear overdue debt and for continued expansion of the business.

Convertible notes issue proposed by shareholder Alden AS

The right to subscribe for convertible loan notes in the directed issue proposed by Alden AS shall vest in Baklid Invest AS, CeWi Invest AS, Fougner Invest AS, Trellevika Invest AS, Fredrik Fougner, Skadi AS, TTC Invest AS and Windchange Invest AB on the same terms and conditions as for the convertible notes issued by the Board of Directors today. Full details about the proposal will be included in the notice convening the extraordinary general meeting. The proposed directed issue to the board members and management is subject to the so-called Leo Act (Chapter 16 of the Swedish Companies Act). Notice convening an extraordinary general meeting for resolution on the directed issue will be announced through a separate press release.

Terms and conditions

The terms and conditions of the convertible loan notes in both the directed issue resolved by the board of directors and the proposal by the Company’s shareholder Alden AS are identical. The convertible loan notes mature on February 28, 2023 and carries an annual interest rate of six (6) per cent. The conversion price for new shares is set at SEK 1.00 and the holder of the convertible instrument has the right to ask for conversion of whole or part of its claim to new shares in the Company commencing on the date of the registration of the issue and up until February 28, 2023. Terms of the convertible loan notes, including the conversion price, have been determined following arms lengths negotiations with the subscribers. As a result, the board of directors of the Company considers that the terms of the convertible loan notes issue are in line with market conditions.

Share capital, shares, and dilution

Upon on full conversion of the convertible loan notes in the directed issue to Subscribers (excluding accrued interest) the share capital will increase by approximately SEK 2,853,077.38 by issue of 34,608,337 new shares.

Provided that the extraordinary general meeting resolves in accordance with Alden AS proposal and upon full conversation (excluding accrued interest) the share capital will increase by an additional amount of approximately SEK 3,053,772.70 by issue of 37,042,807 new shares.

Provided that the extraordinary general meeting resolves to carry out Alden AS proposal, the dilution for existing shareholders amounts to a maximum of approximately 43.8 per cent

For more information, please contact:

Truls Baklid, CEO Hoylu AB

Tel: +47 924 38 900

Email: [email protected]

Certified Adviser:

Mangold Fondkommission AB

About Hoylu

Hoylu’s visual collaboration technology empowers distributed teams to translate ideas into actions. Large enterprises as well as small and medium companies rely on Hoylu to run projects, programs, and initiatives across time zones and continents as seamlessly as when working in the same room.

For more information: www.hoylu.com

Try Hoylu for free: https://app.hoylu.com/

Publication

This information is information that Hoylu AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 18:45 CET on November 7, 2022.