Techstep ASA announces trading update, bridge financing and plans for rights issue

Techstep ASA announces trading update, bridge financing and plans for rights issue

Techstep ASA (the "Company") today announces a new bridge financing facility to

cover short term financing needs and the plans for a rights issue. During Q2 the

Company has faced deteriorating fundamentals even though the long-term potential

remains strong. The rollout within the Health sector represents a large

potential for the company, and at the same time it has been taking more time

than originally expected. The European partner segments also have been

experiencing more lengthy sales and consumption processes. In addition, the

integration and ERP platforms have imposed higher costs on the Company. The

Management and the Board has launched a Techstep Improvement Program to give

firm attention to increasing long-term profitability. However, the combined

factors result in need for additional funding.

The Company has secured a NOK 40 million senior secured revolving facility from

Danske Bank (the "Bridge Facility") as bridge financing to a contemplated equity

raise. The Bridge Facility has a 4-month tenor.

The Bridge Facility has been guaranteed by the three largest shareholders of the

Company, Datum AS, Karbon Invest AS and Valset Invest AS in addition to Arisona

Holding AS and Specter Invest AS (together the "Guarantors"), who are also

represented on the Company's board of directors.

The Company has undertaken to initiate a process of raising a minimum of NOK

83.3 million in new equity during H2. Proceeds will be used for repayment of the

Bridge Facility and release the Guarantors from their obligation towards the

bank, and to strengthen the balance sheet by settling the outstanding NOK 35

million (excluding interests) in shareholder loans. The Company contemplates

proposing to its shareholders the approval of a rights issue, expected to take

place during September/October.

The Company has obtained an undertaking from Datum AS, Karbon Invest AS, Valset

Invest AS, Arisona Holding AS and Specter Invest AS (the "Underwriters") that

they fully underwrite any planned rights issue up to NOK 83.3 million at a price

of NOK 1 per share for an underwriting fee of 10% to be settled in shares in the

Company. The Board remains open to alternative proposals from other investors

that would support the rights issue at a higher subscription price.

"On behalf of the Board and the Company, we are grateful for the support

provided by the Company's main shareholders and its lender, Danske Bank, in

securing both short-term and long-term operational financing in a challenging

market environment. We are also confident that the planned rights issue this

autumn will ensure equal treatment of all shareholders and give all shareholders

the opportunity to participate in the further capitalization of the Company's

operations and development," says Arild Hustad, Chair of the Board.

"This financing is important to safeguard our operational flexibility as we

continue to execute on Techstep's strategic transformation. We appreciate the

confidence shown by our largest shareholders and the Board, who recognize the

potential in Techstep's proprietary software platforms and unique mobility

expertise. This positions us strongly to deliver demanding and complex mobility

projects in the Nordics, while our European partner strategy, built on scalable

software platforms, provides a solid foundation for future profitability and

recurring revenue," says Morten Meier, CEO of Techstep.

The planned rights issue, including settlement of the shareholder loans

represents a liquidity injection of minimum NOK 83.3 million and will contribute

to the catch-up of the higher spend over the last previous months as well as

supports the need reflected in the forward-looking profitability projections.

The Company is expected to convene an extraordinary general meeting in due

course.

As a consequence of the trading update, the Company's board of directors have

started considering alternatives for the Company and will initiate a strategic

review following the rights issue. The strategic review will evaluate several

potential courses of action, which may include structural changes, delisting or

an alternative ownership structure.

Danske Bank A/S NUF has been retained as sole bookrunner in connection with the

planned rights issue.

For further information, please contact:

Morten Meier, CEO

+47 97057717

[email protected]

Håvard Haukdal, CFO

+47 48106569

[email protected]

Arild Hustad, Chair of Board

+47 95241930

About Techstep

Techstep is a mobile and circular technology enabler delivering end-to-end

device lifecycle management to more than 2,100 customers and managing over 3

million devices across Scandinavia, as well as globally through partners. The

company is listed on Euronext Oslo Børs under the ticker TECH

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 MAR article 17 and section 5 -12 of the Norwegian Securities Trading

Act. This stock exchange release was published by Håvard Haukdal, CFO Techstep,

at the time and date set out above.