HYON signs Share Purchase Agreement with Blue Concept Ltd.

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Oslo, Norway, 31 March 2024 – Hyon AS ("HYON") has signed a Share Purchase Agreement ("SPA") with Blue Concept Ltd. ("Blue Concept") for the acquisition of 19.5% of the shares in Rapid Oil Production Ltd., ("Rapid") a UK-based oil & gas company.

• The agreement closes the strategic review process initiated by the board of directors of HYON within Q1 2024 as previously communicated as the targeted completion.
• HYON is given a basis for continued operations, where it is intended that additional shareholders in Rapid is also given the opportunity to sell their shares against receiving HYON shares to establish Rapid as a subsidiary of HYON.
• Blue Concept will become the largest owner of HYON and intends to secure funding to support continued operations following completion of the SPA, which may consist of loans, equity or any combination thereof.
• The SPA will be dealt with at an extraordinary general meeting to be held on or about 16 April 2024.

Pursuant to the SPA, Blue Concept will sell its 19.5% shareholding in Rapid against a 73.8% ownership in HYON in an all-share transaction. HYON will issue consideration shares that will be new shares issued pursuant to a general meeting's resolution. The transaction, together with the contemplated potential additional acquisition of shares in Rapid from other shareholders whereby Rapid may become a subsidiary of HYON, redirects and restructures HYON towards an enlisted oil company with combined HYON and Rapid shareholder base.

“We are pleased to provide this opportunity to our shareholders to leverage on our infrastructure as a listed company. Since the announcement of the discontinuation of our hydrogen initiatives, Hyon has taken all necessary measures to reduce the activity and cost base in the company, and have now concluded on a transaction the board of directors in Hyon believe is the most valuable solution for our shareholders given the alternatives available. HYON has made a significant effort to develop advanced technical solutions for bunkering of ships with hydrogen. The market has turned out to be immature and is unfortunately delayed with several years in the whole hydrogen value chain. Norwegian Hydrogen has over the years invested resources and competences in the development of Hyon. The Board is very motivated that Norwegian Hydrogen AS will take over ownership and further development of the HYON proprietary technology for inclusion into their hydrogen projects. In addition, we propose to the shareholders to enter into the Rapid agreement to maximize the value of the company in line with the initiatives announced during the autumn of 2023,” says Otto Søberg, Chairman of HYON.

“We have successfully established a business based on oil & gas assets in Rapid. The oil industry is in many geographical areas fragmented with a high number of smaller companies. We strongly believe in the role of being a catalyst for consolidation of smaller oil companies and production interests in order to attract financing, diversify risk and get economy of scale,” says Geir Aune, Chairman of Rapid and Blue Concept.

About Rapid
Rapid is a UK-based oil & gas company backed by a highly experienced management team and Board of Directors with extensive experience from the oil & gas and oil service sector. Rapid's main asset is a working interest in the Fyne field development in the UK, a low-risk development with strong economics that is targeting first oil in 2026.

Rapid owns 15% of the fully funded Fyne development project offshore UK. First oil is planned for Q3 2026 and the net cash flow after tax from Rapid’s share of the production is expected to be $53 million, based on an oil price of $80 per bbl. There will be no additional financing required from Rapid for this project.

Board and management
Geir Aune has been nominated to be Chairman of the Board of Directors of HYON. In addition, Georges Lambert has been nominated as Board member. Geir Aune will also take on as the role as CEO.

Conditions for completion of the transaction and important information
The Transaction is subject to customary terms and conditions, including inter alia following being satisfied or waived by the parties:

• The EGM of HYON approving the Transaction
• Election of the nominated Board of Directors
• All known liabilities of HYON, other than as a result of the Transaction shall be settled

A notice calling for the EGM to approve the necessary corporate resolutions is expected to be issued on 2 of April 2024. It will be proposed that HYON issues 150,238,113 new shares to Blue Concept, providing an ownership in HYON of 73.8% whilst current shareholders in HYON will represent 26.2% of the shares post transaction.

As part of the completion of the acquisition of Rapid shares, HYON will adhere to the Shareholders Agreement between Rapid and its shareholders on the same terms as Blue Concept has as of today.

The SPA is expected to be closed in Q2 2024, following which HYON intends to change its name to Knox Energy Solutions AS.

The completion of the transaction is conditional upon approval from the Board of Directors in Rapid.

Following completion of the acquisition of Rapid shares from Blue Concept, it is intended that other shareholders in Rapid shall be offered to sell their shares in Rapid against receiving HYON shares. This second part of the transaction remains subject to agreements being entered into as well as necessary corporate resolutions. There cannot be made any guarantee as to the completion of any additional transaction or acquisition of shares in Rapid that increases HYON's ownership in Rapid, or that any such transaction will not deviate from what is stated in this announcement.

The SPA assumes a business combination, and Blue Concept's commercial rational and valuation is based on this assumption. Blue Concept's investment in HYON is subject to the portion of shares in Rapid that HYON will ultimately own. Upon completion of the Transaction, Blue Concept will become the owner of approx. 73.8% of the shares in HYON. If and to the extent not all the remaining shareholders in Rapid accepts the subsequent offer and swap their ownership in Rapid with shares in HYON, the percentage of Blue Concept's shareholding will be increased. The SPA sets out that Blue Concept may achieve a stake of up to 90% (for the avoidance of doubt always below 90%) in HYON through subscription of 388,041,212 warrants each providing the right to subscribe one share in HYON at par value. The warrants may be exercised to the extent the acquisition of shares in Rapid (in addition to the shares acquired from Blue Concept) falls short of a 100% ownership in Rapid. The warrants expire by and will, together with the board of directors of HYON to be elected upon completion of the Transaction, work year end 2024. The SPA assumes a business combination with an exchange ration of 6% to existing shareholders in HYON and 94% to Rapid. Further to this, Rapid cannot exercise a number of warrants resulting in the shareholders of HYON as of the date of signing the agreement holding a lower stake than 6% in the Purchaser as a result of the exercise.

The Company's current liquidity situation is estimated to be adequate and sufficient to maintain current reduced operations for a few months. As a result, the Company is planning to raise new financing.

Divestment of current operations in HYON
HYON has discontinued current operations and will in conjunction with the agreement with Blue Concept divest all assets related to its current operations to Norwegian Hydrogen AS, HYON’s largest shareholder and only customer.

HYON has received an advance payment from Norwegian Hydrogen AS under a supply agreement amounting to NOK 500,000. The project was stopped due to a lack of funding and HYON is, therefore, in default of its obligations under the supply agreement as no delivery has been made. It is a condition for the proposed transaction with Blue Concept that all known claims towards HYON have been settled at closing and Hyon has, therefore, explored potential solutions with Norwegian Hydrogen AS. Hyon has received an offer from Norwegian Hydrogen AS that waives all potential claims towards Hyon against transfer of the intellectual property rights owned by HYON. HYON’s intellectual property rights does not include any patents.

HYON has previously actively pursued a potential sale of its business and/or intellectual property rights without receiving any bids or commitments. As a result, the value of Hyon’s intellectual property rights must be considered limited, despite HYON having spent considerable time and money on development of its intellectual property right. In the interest of allowing the transaction to proceed, HYON’s board of directors has accepted the offer from Norwegian Hydrogen AS subject to the transaction with Blue Concept being approved by the extraordinary general meeting.

Presentation
In connection with the EGM a presentation by Blue Concept Ltd. will be made regarding the future strategy and plans for the company.

Contacts

HYON
Otto Søberg, Chairman of the Board
E-mail: [email protected]

Blue Concept Ltd.
Geir Aune, Chairman of the Board
E-mail: [email protected]

Advisers
Advokatfirmaet Selmer AS is acting as legal advisor to HYON AS. Advokatfirmaet Wiersholm AS is acting as legal advisor to Blue Concept Ltd.

Important information
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 Section 5-12 the Norwegian Securities Trading Act. The stock exchange announcement was published by Otto Søberg, Chairman of HYON AS, at the time and date stated above in this announcement.

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. 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.

Matters discussed in this announcement 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 HYON 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 its control.

The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice. HYON undertakes no 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.

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.