The Board of Directors of Next Games resolved on a rights offering and publishes the terms and conditions and basic information document of its rights offering
NEXT GAMES CORPORATION, INSIDER INFORMATION, 25 SEPTEMBER 2019 AT 1:55 p.m. EEST
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, SOUTH AFRICA, HONG KONG, JAPAN, CANADA OR SINGAPORE OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.
The Board of Directors of Next Games Corporation (“Next Games” or the “Company”) has resolved on 25 September 2019 on a rights offering of approximately EUR 8 million (the “Offering”) with pre-emptive subscription right for existing shareholders based on the authorisation granted by the Extraordinary General Meeting held on 25 September 2019. The proceeds from the Offering will be used to strengthen the balance sheet of the Company and according to the Company’s strategy, enable future investments such as product development and marketing of new products as well as be used for license payments and other general corporate purposes. The Board of Directors of Next Games today announces the terms and conditions of the Offering.
The Offering in short
- Next Games aims to raise gross proceeds of approximately EUR 8 million by offering new shares (the “Offer Shares”) for subscription in the Offering.
- The existing shareholders of the Company have a pre-emptive right to subscribe for Offer Shares (the “Subscription Right”) issued in the Offering in proportion to their existing shareholdings in the company.
- Shareholders will receive one (1) Subscription Right for each one (1) share held on the record date 27 September 2019 (the “Record Date”).
- Each two (2) Subscription Rights entitle to subscribe for one (1) new share in the Offering.
- The subscription price is EUR 0.86 per share (the “Subscription Price”).
- The Company’s shares will trade ex-rights from 26 September 2019.
- Subscription Period commences on 2 October 2019 at 9.30 a.m. Finnish time and expires on 16 October 2019 at 4.30 p.m. Finnish time (the “Subscription Period”).
- The Subscription Rights are freely transferrable and trading in the Subscription Rights on Nasdaq First North Growth Market Finland (“First North”) is expected to take place between 2 October 2019 and 10 October 2019.
- Existing shareholders Jari Ovaskainen and AMC Networks Ventures LLC (“AMC”) have committed to undertakings to subscribe, subject to certain conditions, for Offer Shares in the Offering up to a maximum amount of EUR 4 million each, EUR 8 million in total, in the event that any shares remain unsubscribed for after the expiry of the Subscription Period of the Offering.
Background and reason for the Offering
Next Games has successfully renewed its operations during this year by stabilising its business operations and rebuilding the product development pipeline. The third and final phase of the turnaround project is to secure additional funding, which is why the Board of Directors has decided to carry out the Offering.
The proceeds from the Offering will be used to strengthen the balance sheet of the Company and according to the Company’s strategy, enable future investments such as product development and marketing of new products as well as be used for license payments and other general corporate purposes. The Offering will also enable the Company to expand its shareholder base and increase the liquidity of its share.
Terms and conditions of the Offering
A shareholder who is registered in the Company's shareholders' register on the Record Date 27 September 2019 of the Offering will automatically receive one (1) freely transferable Subscription Right for every one (1) existing share owned on the Record Date. Every two (2) Subscription Rights entitle the holder to subscribe for one (1) Offer Share at the Subscription price (the “Primary Subscription Right”). Fractions of Offer Shares cannot be subscribed for. Shareholders or other investors are entitled without Subscription Rights to subscribe for Offer Shares that have not been subscribed with Primary Subscription Right (“Secondary Subscription”). Subscriptions for Offer Shares are binding and irrevocable and cannot be altered or cancelled.
As a result of the Offering, the total number of shares in the Company may increase from 18,610,270 shares to a maximum of 27,908,700 shares. If the Offering is fully subscribed for, the Offer Shares will correspond to approximately 50% of the Company's issued and outstanding shares prior to the Offering.
The Subscription Price is EUR 0.86 per Offer Share.
Subscription Period commences on 2 October 2019 at 9.30 a.m. Finnish time and expires on 16 October 2019 at 4.30 p.m. Finnish time. Holders of Subscription Rights may sell their Subscription Rights at any time prior to the end of trading in the Subscription Rights. The Subscription Rights are subject to trading on First North from 2 October 2019 at 10.00 a.m. Finnish time to 10 October 2019 at 6.25 p.m. Finnish time. Any unexercised Subscription Rights will expire without any compensation at the end of the Subscription Period at 4.30 p.m. Finnish time on 16 October 2019.
The Company’s Board of Directors will approve all subscriptions made pursuant to the Primary Subscription Right and in accordance with the terms and conditions of the Offering. In the event not all the Offer Shares in the Offering have been subscribed for pursuant to the exercise of the Primary Subscription Right, the Company’s Board of Directors will allocate unsubscribed Offer Shares first to those shareholders and other investors who have made a Secondary Subscription and also subscribed for Offer Shares on the basis of Subscription Rights, second to those shareholders and other investors who have made a Secondary Subscription but have not subscribed for any Offer Shares on the basis of Subscription Rights and third to the parties that gave subscription commitments in accordance with the terms and conditions of the Offering.
The interim shares will become subject to trading on or about from 17 October 2019. The interim shares will be combined with the Company’s existing shares on or about 23 October 2019. The Offer Shares subscribed for and approved in the Secondary Subscription will be entered into the book-entry accounts of the subscribers on or about 23 October 2019, after the registration of the Offer Shares with the Trade Register on or about 22 October 2019.
The Company will publish the final results of the Offering in a company release on or about 22 October 2019.
Subscription undertakings from current shareholders
The Company's largest shareholder, Jari Ovaskainen, who holds approximately 16.6% of all the shares and votes in the Company, has committed to subscribe for his pro-rata share of the Offer Shares in the Offering. In addition, Jari Ovaskainen has undertaken to subscribe for Offer Shares that may not be otherwise subscribed for with a maximum of EUR 4 million, i.e. approximately 50% of the Offer Shares, which includes Jari Ovaskainen's pro rata share of the Offer Shares. Jari Ovaskainen's subscription commitment is conditional upon the fulfilment of certain conditions.
The Company's major shareholder, AMC, which holds approximately 5.2% of all the shares and votes in the Company, has committed to subscribe for its pro-rata share of the Offer Shares in the Offering. In addition, AMC has undertaken to subscribe for Offer Shares that may not be otherwise subscribed for with a maximum of EUR 4 million, i.e. approximately 50% of the Offer Shares, which includes AMC's pro rata share of the Offer Shares. AMC's subscription commitment is conditional upon the fulfilment of certain conditions.
Indicative timetable for the Offering
|26 September 2019||Ex-rights date|
|27 September 2019||Record date of the Offering|
|2 October 2019||Subscription period for the Offering commences|
|2 October 2019||Trading in the Subscription Rights on First North commences|
|10 October 2019||Trading in the Subscription Rights on First North expires|
|16 October 2019||Subscription period for the Offering expires and unexercised Subscription Rights expire without compensation|
|17 October 2019 (estimate)||Preliminary result of the Offering published|
|17 October 2019 (estimate)||Trading in the interim shares on First North commences|
|22 October 2019 (estimate)||Final result of the Offering published|
|22 October 2019 (estimate)||Trading in the interim shares on First North expires|
|22 October 2019 (estimate)||Shares subscribed for in the Offering are registered in the Trade Register|
|23 October 2019 (estimate)||Interim shares are combined with the existing shares of the Company on First North|
|23 October 2019 (estimate)||Shares subscribed for in the Offering are admitted to trading on First North|
Danske Bank A/S, Finland Branch (“Danske Bank”) is acting as the lead manager in the Offering and Castrén & Snellman Attorneys Ltd is acting as the legal advisor to the Company and Danske Bank.
The basic information document concerning the Offering provided for in chapter 3, section 2 of the Finnish Securities Markets Act (746/2012, as amended) will be available on the Company’s website at www.nextgames.com/fi/ng/sijoittajille/ from on or about 25 September 2019 until the end of the offering period.
Detailed terms and conditions of the Offering are enclosed in the appendix of this company release.
+358 (0)50 483 3896
Certified Adviser: Danske Bank A/S, Finland Branch, tel. +358 10 546 7938
Next Games is the first publicly listed mobile game developer and publisher in Finland, specializing in games based on entertainment franchises, such as movies, TV series or books. The developers of the critically acclaimed The Walking Dead games redefines the way franchise entertainment transforms into highly engaging service-based mobile games. In summer 2018, Next Games launched The Walking Dead: Our World, which utilizes cutting edge AR technology and is powered by Google Maps. Currently Next Games is working on multiple new games based on popular entertainment franchises including, Blade Runner Nexus, for the popular Blade Runner franchise and a mobile game based on Netflix’s Stranger Things.
The information contained herein is not for publication or distribution, directly or indirectly, in or into Australia, Canada, Hong Kong, Japan, South Africa, Singapore or the United States. The issue, exercise or sales of securities in the Offering are subject to specific legal or regulatory restrictions in certain jurisdictions. The Company assumes no responsibility in the event there is a violation by any person of such restrictions.
The information contained herein shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Investors must neither accept any offer for, nor acquire, any securities to which this document refers, unless they do so on the basis of the information contained in the applicable prospectus published by the Company.
These written materials do not constitute an offer for sale of securities in the United States, nor may the securities be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder. There is no intention to register any portion of the offering in the United States or to conduct a public offering of securities in the United States.
The Company has not authorised any offer to the public of securities in any member state of the European Economic Area other than Finland. With respect to each member state of the European Economic Area, no action has been undertaken or will be undertaken to make an offer to the public of securities requiring publication of a prospectus in accordance with Regulation (EU) 2017/1129 of the European Parliament and of the Council.
The information contained herein shall not constitute a public offering of shares in the United Kingdom. This document is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) to investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2) of the Order (all such persons together being referred to as “relevant persons”). Any investment activity to which this document relates will be only available to, and will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.
The information contained in this document is for background purposes only and does not purport to be full or complete. No reliance may or should be placed by any person for any purposes whatsoever on the information contained in this document or on its completeness, accuracy or fairness. The information in this document is subject to change. Any subscription for securities should be made solely on the basis of the information contained in the offering circular to be issued by the company in due course.
This document contains certain forward-looking statements. These forward-looking statements involve risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward-looking statements. Due to these uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as at the date of this document. The company disclaims any obligation to update any forward-looking statements contained in this document, except as required pursuant to applicable law.