Impact Coatings AB’s (“the Company”) Chairman of the Board Mark Shay has informed the Company that approximately 96,000 of his total 150,000 received subscription rights cannot be exercised since they are registered outside the geographic jurisdiction of the ongoing rights issue. To allow him to subscribe his pro rata portion, and to fulfill his subscription commitment, he has elected to acquire the corresponding number of subscription rights. The subscription rights that Mark Shay received but cannot exercise will not be transferred.
THE INFORMATION IN THIS PRESS RELEASE IS NEITHER AN OFFER TO ACQUIRE NOR AN OFFER TO SUBSCRIBE FOR ANY SECURITIES IN IMPACT COATINGS AND THE INFORMATION IS NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, HONG KONG, NEW ZEALAND, SOUTH AFRICA, SOUTH KOREA, SWITZERLAND, SINGAPORE, JAPAN, RUSSIA, BELARUS OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, DISTRIBUTION OR PUBLICATION WOULD BE UNLAWFUL.
In connection with the subscription period (9 March-23 March, 2023) for the ongoing rights issue in Impact Coatings AB, the company is now publishing an investor presentation about the company and the rights issue, with CEO Torbjörn Sandberg as presenter. The presentation can be viewed at www.impact-offer.com.
The investor presentation constitutes advertizing of the ongoing rights issue in Impact Coatings. A prospectus has been published and is available on Impact Coatings’ webpage, www.impact-offer.com, Pareto Securities’ webpage, www.paretosec.com, and wthe Swedish Financial Supervisory Authority’s webpage, www.fi.se.
THE INFORMATION IN THIS PRESS RELEASE IS NEITHER AN OFFER TO ACQUIRE NOR AN OFFER TO SUBSCRIBE FOR ANY SECURITIES IN IMPACT COATINGS AND THE INFORMATION IS NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, HONG KONG, NEW ZEALAND, SOUTH AFRICA, SOUTH KOREA, SWITZERLAND, SINGAPORE, JAPAN, RUSSIA, BELARUS OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, DISTRIBUTION OR PUBLICATION WOULD BE UNLAWFUL. PLEASE SEE “IMPORTANT INFORMATION” AT THE END OF THIS PRESS RELEASE.
On 28 February 2023, Impact Coatings AB (publ) (“Impact Coatings” or the “Company”) announced that the board of directors had resolved on a rights issue of up to approximately SEK 148.2 million (the “Rights Issue”), making use of the authorisation by the Extraordinary General Meeting on 16 February 2023. Impact Coatings has prepared a so called secondary issue prospectus by reason of the Rights Issue. The prospectus has today been approved by the Swedish Financial Supervisory Authority and has been made available on Impact Coatings’ webpage, www.impact-offer.com, together with all other information related to the Rights Issue. The prospectus is also held available on Pareto Securities’ webpage, www.paretosec.com, and will be made available at the Swedish Financial Supervisory Authority’s webpage, www.fi.se.
The subscription period for the Rights Issue is to be carried out during the period from and including 9 March 2023 up to and including 23 March 2023. AdvisersPareto Securities AB (“Pareto”) acts as Sole Manager and Bookrunner and KANTER Advokatbyrå KB is legal adviser to the Company and Advokatfirman Schjødt is legal adviser to Pareto Securities AB in connection with the Rights Issue.
The Board of Directors in Impact Coatings AB (publ) (“Impact Coatings” or the “Company”) has today, making use of the authorisation by the Extraordinary General Meeting on 16 February 2023, resolved on a right issue of up to 30,877,662 shares (the “Right Issue”) with a subscription price of SEK 4.80 per share. The Company’s largest shareholder, Accendo Capital SICAV RAIF (”Accendo Capital”), has provided a guarantee commitment on customary terms that amounts to approximately SEK 128.7 million, corresponding to approximately 86.8 percent of the Rights Issue. In addition, Accendo Capital as well as shareholding members of the Board of Directors and senior management have entered into subscription commitments, which in aggregate amount to approxiamtely SEK 19.5 million, corresponding to approximately 13.2 percent of the Rights Issue. The Rights Issue is therefore covered to a total of 100 percent by both subscription- and guarantee commitments. Assuming full subscription in the Rights Issue, the Company’s proceeds will amount to approximately SEK 148.2 million before transaction costs of approximately SEK 17.5 million. It is the Board of Directors’ assessment that the Company’s existing working capital is not sufficient to cover the capital requirements for the upcoming twelve (12) months, why the Company carries out the Rights Issue. The Rights Issue will secure continued investments in the industrialization and internationalization of Impact Coatings as well as enable an emerging opportunity within the US green hydrogen market.
Summary of the Rights Issue:
Background and motiveThe purpose of the Rights Issue is twofold. First, it secures continued investments in the industrialization and internationalization of Impact Coatings, strengthening the scalability of the business model, which has been an overarching strategic pillar since 2021. Second, it enables the Company to capture an emerging opportunity within the US green hydrogen market – following the strong recent commercial and regulatory development in the region, including the USD 3 per kg green hydrogen tax credit included in the Inflation Reduction Act effective from August 2022. Hydrogen is taking off, unfolding as the fuel of the future and a cornerstone in the shift to sustainable, low carbon energy systems. The development of hydrogen technologies is largely driven by the need for transportation, storage and use of green energy. Electrolysis, the method used to produce green hydrogen from water, is emerging as a new, significant growth area – especially in the US and Europe. The hydrogen market is still in its early stages, and the Company expects it to grow exponentially over the next decade. In the US, the green hydrogen market is expected to double by 2025 and tenfold by 2030. Against this background, Impact Coatings sees a window of opportunity, investing to meet demand for its electrolysis plate coating solutions. The Company has strong momentum in North America within electrolysis, following the received pilot order on 12 November 2022 and following the signed letter of intent on 21 February 2023 regarding a supply or frame agreement, which has created an expansion platform for it to leverage in the US market. Strengthening the scalability of the business model will also improve the efforts in all major markets, as the Company seeks to further invest in Coating Services. This includes continuing the roll-out of new Coating Services Centers. It is the Board of Directors’ assessment that the Company with its current cash possesses sufficient liquid funds until September 2023, why the Company’s existing working capital is not sufficient to cover the capital requirements for the next twelve (12) months and the Rights Issue is being carried out. Use of proceedsIf the Rights Issue is fully subscribed, the Company will receive a maximum of approximately SEK 148.2 million before deductions for transaction costs of approximately SEK 17.5 million. Impact Coatings intends to use the net proceeds of approximately SEK 130.7 million for the following purposes stated in order of priority:
It is the Board of Directors’ assessment that the SEK 148.2 million of the Rights Issue covered by subscription and guarantee commitments is sufficient to, according to the current business plan, finance the Company during the next twelve-month period. Terms for the Rights IssueShareholders who are registered in the share register in Impact Coatings on the record date 7 March 2023 receives one (1) subscription right for each share held in the Company. The subscription right entitles the holder to subscribe for new shares with preferential rights. Eleven (11) subscription rights entitle the holder to subscription of six (6) new shares. The subscription price is SEK 4.80 per share and Impact Coatings will receive gross proceeds of approximately SEK 148.2 million before deduction of transaction costs, provided that the Rights Issue is fully subscribed. In addition, investors are offered the opportunity to sign up for subscription of shares without the support of subscription rights. Provided that the Rights Issue is fully subscribed, the number of shares in Impact Coatings will increase by 30,877,662, from 56,609,051, to 87,486,713, and the share capital will increase by a maximum of SEK 3,859,707.750, from SEK 7,076,131.375 to SEK 10,935,839.125. Shareholders who choose not to participate in the Rights Issue will have their ownership diluted by up to approximately 35 percent through the Rights Issue (based on the total outstanding shares after the Rights Issue). These shareholders have the opportunity to compensate themselves financially for the dilution effect by selling their subscription rights received. The preliminary timeplan is as follows. The last day of trading in Impact Coatings’ shares including the right to receive subscription rights in the Rights Issue is 3 March 2023. The shares are traded excluding the right to receive subscription rights in the Rights Issue as of 6 March 2023. The subscription period, with or without the support of subscription rights, runs from 9 March 2023 up to and including 23 March 2023. Trading in subscription rights will take place on Nasdaq First North Growth Market during the period from 9 March 2023 up to and including 20 March 2023 and trading in BTAs (paid subscribed shares) will take place on Nasdaq First North Growth Market during the period from 9 March 2023 up to and including 4 April 2023. The full terms and conditions and information about Impact Coatings will be presented in the prospectus that the Company plans to publish in relation to the Rights Issue on, or about, 3 March 2023. The prospectus will be available on Impact Coatings’ website (https://impact-offer.com/), Finansinspektionen’s website (https://www.fi.se/) and Pareto Securities AB’s website (https://www.paretosec.com). Subscription and guarantee commitmentsIn total, subscription commitments amount to approximately SEK 19.5 million, corresponding to approximately 13.2 percent of the Rights Issue and has been entered into by Accendo Capital and shareholding members of the Board of Directors and senior management. Accendo Capital has also provided a guarantee commitment on customary terms that amounts to approximately SEK 128.7 million, corresponding to approximately 86.8 percent of the Rights Issue. The Rights Issue is therefore covered to a total of 100 percent by both subscription and guarantee commitments. A guarantee fee of eight (8) percent of the guaranteed amount will be paid in cash under the guarantee commitment. No fee is to be paid for the subscription commitments that have been entered into. Submitted subscription and guarantee commitments can be fulfilled by subscription and payment of shares in the Rights Issue, or by the shareholder providing to the company an unconditional shareholder contribution corresponding to the commitment. Neither the subscription commitments nor the guarantee commitments are secured. Bid exemptionThe Swedish Securities Council has granted Accendo an exemption from the mandatory bid obligation, which could arise due to the subscription in the Rights Issue. Furthermore, the Swedish Securities Council has granted Accendo an exemption from the mandatory bid obligation, which could arise due to, in additional to their preferential rights, the subscription of shares due to the guarantee commitment. The exemption, as far as the guarantee commitment is concerned, is conditional on (i) the shareholders being informed before the extraordinary general meeting of the maximum capital and voting share that Accendo may obtain by subscribing for shares in the rights issue in addition to its preferential rights, and (ii) that the resolution to issue new shares is approved by the Extraordinary General Meeting and supported by shareholders holding not less than two-thirds of both the votes cast and the shares represented at the Extraordinary General Meeting, whereby the shares held and represented at the meeting by Accendo shall be disregarded. The Swedish Securities Council’s decision (AMN 2022:57) is available on the Swedish Securities Council’s website. The percentage of shares and votes held by Accendo Capital, at fully utilization of the guarantee commitment, will not exceed 43.6 percent of the toal number of shares and votes in the Company. Lock-up undertakingsPrior to the Rights Issue being carried out, Accendo Capital and the Board of Directors and senior management of the Company have entered into lock-up undertakings, which, inter alia and subject to customary exceptions regarding, among other things, intra-group transfers, sales in connection with public takeover offers or sales of allocated subscription rights, mean that they will undertake not to sell shares in the Company without consent from Pareto Securities AB. The lock-up undertakings expire on the day that falls six (6) months after the end of the subscription period in the Rights Issue. The Company has undertaken towards Pareto Securities AB, subject to customary exceptions, not to issue additional shares or other share-related instruments without consent from Pareto Securities AB, for a period of twelve (12) months after the end of the subscription period in the Rights Issue.
Indicative timeplan for the Rights Issue
AdvisersPareto Securities AB acts as Sole Manager and Bookrunner, KANTER Advokatbyrå KB is legal adviser to the Company and Advokatfirman Schjødt is legal adviser to Pareto Securities AB in connection with the Rights Issue.
Plug Power and Impact Coatings have signed a letter of intent to sign a definitive supply or frame agreement, where Impact Coatings may be awarded coating services of separator plates and portable transport layer plates for electrolysis for a value of 2 to 3.5 MUSD during 2023, conditioned on the parties entering into a definitive supply agreement, that Impact Coatings will fulfill the technical requirements provided by Plug Power for these plates, and that Impact Coatings can demonstrate delivery capability of the number of plates corresponding to the above value.
Impact Coatings AB (publ) has today, 16 February 2023, held an extraordinary general meeting where the following resolutions were adopted.
Amendment of the articles of associationIn order to enable the rights issue in accordance with the press release published on December 22, 2022, the meeting resolved to amend the limits of the share capital stated in the articles of association (§4) from “no less than SEK 2,500,000 and no more than SEK 10,000,000” to “no less than SEK 5,000,000 and no more than SEK 20,000,000” and to amend the limits of shares stated in the articles of association (§5) from “no less than 20,000,000 and no more than 80,000,000” to “no less than 40,000,000 and no more than 160,000,000”.
Authorization for the Board of Directors to resolve on new issue of sharesIn order to enable the above mentioned rights issue, the meeting resolved to authorize the Board of Directors to, at one or several occasions during the period until the next annual general meeting, resolve on issue of new shares with preferential rights for the Company’s shareholders of no more than 30,877,664 new shares. Payment shall be made in cash, by non-cash consideration or by set-off.
Impact Coatings AB (Sweden) and Hyundai Motor Company (South Korea) have signed an extension to a joint development agreement entered in 2019, and which was described in a press release on October 30, 2019. According to the joint development agreement the companies will “… jointly research and develop novel materials, processes and equipment for coatings for applying it into bipolar plates for a variety of applications including fuel cells and/or hydrogen production.”
FINANCIAL RESULTS FOURTH QUARTER 2022
FINANCIAL RESULTS FULL YEAR 2022
SIGNIFICANT EVENTS (1) FOURTH QUARTER 2022
SIGNIFICANT EVENTS (1) AFTER THE PERIOD
(1) Significant events refer to events that comprise insider information and shall be made public via press release.
CEO’s COMMENTARY
During the fourth quarter and full year 2022, Impact Coatings achieved several central milestones in industrializing and internationalizing the company. During 2022, we have clarified our strategy in Coating Services and other service offerings, which helps us accelerate commercialization by working more closely with customers and scaling up production in an appropriate way.
We ended 2022 with strong momentum. In November, the company won its first order within electrolysis for green hydrogen production from a customer in USA. The order marks a historic achievement for the company and creates a robust platform for growth in a highly compelling market.
Technology that matches the market’s development and needsOur unique competence in coating technology and our new coating system for volume production – INLINECOATER™ IC2000 – form a solid basis for continued commercial development. We have a technology, initially developed for fuel cells, that is applicable to electrolysis in parallel with our continuing efforts in fuel cells.
Strong start of 2023 following a slower 2022The fourth quarter, like 2022 in general, was characterized by challenging macroeconomic developments. Net sales for the full year 2022 amounted to SEK 32,022 thousand (57,198). One of three system orders received during the year was delivered with the associated revenue recognized as planned during the fourth quarter. Revenue recognition for the other two systems ordered during 2022 will occur during 2023. During the year, we also built two coating machines for internal use, which have been recognized as capitalized work for own account and included in total revenue. Fewer system deliveries during 2022 is the primary reason for the lower sales level compared to 2021.
After a promising start to the year, annual sales for Coating Services during 2022 ended at the same level as in 2021. A slowdown occurred during the year due to component shortages that affected our customers and, by extension, our business. A recovery toward the end of the fourth quarter and high capacity utilization in Coating Services at the start of 2023 have significantly improved our outlook for Coating Services development.
Operating expenses increased during 2022 due to increased investments in expertise, ongoing R&D projects, and increased production capacity, as well as the establishment of a subsidiary and Coating Services Center in China – important initiatives to strengthen our long-term competitive position.
Positive developments in Europe – activity is picking up againEurope remains the company’s primary market, with important customers in all business areas. Within the hydrogen solutions area, an increasing number of large European automotive component suppliers are investing in fuel cells. At the same time, we see a number of European companies increasingly focusing on electrolysis. With the REPowerEU Plan, which aims to secure Europe’s energy needs and independence from Russian gas, the EU Commission has also taken a significant step during 2022 towards formalizing the initiative for green hydrogen.
We expect the pace of European activities to increase significantly during 2023. We are confident that our combination of Coating Services (via our Coating Services Center in Linköping), coating systems, and other service offerings give us the flexibility to meet our customers’ needs quickly.
Continued progress in ChinaPreparation of our Coating Services Center in Shanghai continued during the fourth quarter. An INLINECOATER™ IC500 machine is scheduled to be shipped from Linköping in March 2023, with start of production in China later during the spring. Our Coating Services Center will facilitate meeting the increased requirements of both new and existing customers. With our establishment and the current team of six people, we have built a strong local organization for the Chinese market. With clear intentions in the production of fuel cell vehicles and hydrogen – focus areas in China’s 14th Five-year Plan (2021-2025) – China remains a strategically important market for the foreseeable future.
Rights issue facilitates investment in USA and green hydrogenThe global development of electrolysis for the production of green hydrogen from renewable energy sources is accelerating and the USA has in a short period of time emerged as a leader in the field. The strong commercial and political development in the region, which encompasses both the Inflation Reduction Act and Hydrogen Shot, create meaningful possibilities due to the USA’s focus on domestic production of green hydrogen.
Against this backdrop, we decided in December 2022 to carry out a fully guaranteed rights issue of approximately SEK 148 million. The issue secures our continuing investments, with a focus on electrolysis and the fast-growing market for green hydrogen. It also enables our initiatives in North America through the establishment of a Coating Services Center as well as the development of Coating Services Centers in other regions – well in line with our strategy.
Strong momentum into 2023We continue strengthening our organization and are preparing to scale up the business. Our regional operations are growing, and through new Coating Services Centers we are increasing our production capacity. We have recently signed a leasing agreement for new headquarters in Linköping, with occupancy planned for the second half of 2024. The new facilities are better equipped for our operations, provide double the production space of our current facility, and will become an important component in the company’s development. During February 2023, Bengt Vernerson joined as interim CFO. In Bengt, the company gains valuable experience from international expansions and capital markets, and he will be an important part of our growth journey during 2023.
We are well positioned to deliver on our strategy during the coming years – a challenge we look forward to.
Torbjörn Sandberg, CEO
The full report is attached, and can be retrieved on the company’s website at www.impactcoatings.com/finansiella-rapporter-arkiv/.
The shareholders of Impact Coatings AB (publ), reg. no. 556544-5318 (the ”Company”), are hereby invited to participate in the Extraordinary General Meeting (“EGM”), which will be held on Thursday, February 16, 2023 at 09.00 a.m. CET at KANTER law firm on Engelbrektsgatan 3 in Stockholm.
Shareholders wishing to participate in the EGM must be registered in the register of shareholders maintained by Euroclear Sweden AB as of Wednesday, February 8, 2023, and notify attendance to the Company no later than Friday, February 10, 2023.
The notice of attendance to the EGM shall be sent by email to anmalan@impactcoatings.com or by post to Impact Coatings AB, Westmansgatan 29G, SE-582 16 Linköping, Sweden. The notice of attendance shall state name, date of birth or corporate identification number, address, telephone number, when applicable, the number of assistants, and the number of shares held by the shareholder.
A form of a power of attorney for shareholders who wish to participate in the EGM through a proxy holder will be available on the Company´s website, www.impactcoatings.com. Shareholders who are represented by a proxy holder may exercise their voting right at the EGM by a proxy holder with a written and dated power of attorney which is signed by the shareholder. If the power of attorney is issued by a legal entity, a copy of the certificate of registration or equivalent for the legal entity shall be attached. The power of attorney and any certificate of registration or equivalent must be sent to the Company to the abovementioned address well in advance before the EGM. The power of attorney cannot be older than one year, unless a longer validity term is specifically stated in the power of attorney, maximum five years.
Shareholders who have had their shares registered in the name of a nominee must have their shares registered in their own name in the register of shareholders maintained by Euroclear Sweden AB in order to be entitled to participate in the EGM. Such registration may be temporary (so-called voting rights registration) and is requested from the trustee in accordance with the trustee’s procedures. Registrations of voting rights made no later than February 10, 2023, will be taken into account in the preparation of the share register.
PROPOSED AGENDA
PROPOSED RESOLUTIONS
Resolution to amend the articles of association (item 7)In order to enable the rights issue in accordance with the press release published by the Company on December 22, 2022, which the Board of Directors intends to resolve upon based on the authorization from the EGM proposed under item 8 below, the Board of Directors proposes that the EGM resolves to amend the articles of association. It is proposed that the limits of the share capital stated in the articles of association (§4) is amended from “no less than SEK 2,500,000 and no more than SEK 10,000,000” to “no less than SEK 5,000,000 and no more than SEK 20,000,000” and that the limits of shares stated in the articles of association (§5) is amended from “no less than 20,000,000 and no more than 80,000,000” to “no less than 40,000,000 and no more than 160,000,000”.
The resolution under this item is conditional on the EGM resolving in accordance with the Board of Directors’ proposal on item 8 below.
A resolution in accordance with this item requires that shareholders representing no less than two thirds of the votes cast as well as the shares represented at the EGM approve the resolution.
Resolution regarding authorization for the Board of Directors to resolve on new issue of shares (item 8)In order to enable the rights issue in accordance with the press release published by the Company on December 22, 2022, the Board of Directors proposes that the EGM resolves to authorize the Board of Directors to, at one or several occasions during the period until the next annual general meeting, resolve on issue of new shares with preferential rights for the Company’s shareholders of no more than 30,877,664 new shares. Payment shall be made in cash, by non-cash consideration or by set-off.
The resolution under this item is conditional on the EGM resolving in accordance with the Board of Directors’ proposal on item 7 above.
Resolution to authorize the Board of Directors to make minor adjustments to the resolutions adopted at the EGM in connection with the registration with the Swedish Companies Registration Office (item 9)The EGM is proposed to authorise the Board of Directors or the person appointed by the Board of Directors to make such minor adjustments and clarifications to the resolutions adopted at the EGM as are necessary for the registration with the Swedish Companies Registration Office.
DOCUMENTS, INFORMATION AND NUMBER OF SHARES AND VOTES
The Board of Directors and the CEO shall, if a shareholder so requests and the Board of Directors believes that it can be done without material harm to the Company, at the EGM provide information regarding circumstances that may affect the assessment of an item on the agenda.
All documents in accordance with the Swedish Companies Act will be available at the Company and on the Company’s website, www.impactcoatings.com, no later than Thursday, January 26, 2023. The documents will be sent free of charge to shareholders who request it and who states its address.
The total number of shares and votes in the Company as of the date of this notice is 56,609,051. The Company holds no own shares.
For information on how your personal data is processed in connection with the EGM, please see the privacy notice on Euroclear Sweden AB’s website, www.euroclear.com/dam/ESw/Legal/Privacy-notice-bolagsstammor-engelska.pdf.
___________________________Linköping in January 2023Impact Coatings AB (publ)Board of Directors
Marie Dhayer Teikmans is leaving as CFO and member of the management team at Impact Coatings, her last day is February 3, 2023. Recruitment of a new CFO has begun, and Bengt Vernerson is appointed acting CFO as of Marie’s departure and during the recruitment period.
“During her time at Impact Coatings, Marie has been instrumental in the change effort to professionalize and industrialize the company, and I thank her for her contributions and commitment,” said Torbjörn Sandberg, CEO at Impact Coatings. Bengt Vernerson has extensive experience in CFO, board and management work with a focus on strategy and business planning. He also has broad experience from internal and external financial reporting in listed companies, including with Höganäs Group and Lammhults Design Group.
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