VOLUNTARY TAKEOVER OFFER OF CLEVON INVESTORS AS TO SHAREHOLDERS OF CLEVON AS FOR THE TAKEOVER OF CLEVON AS SHARES
Introduction
Clevon Investors AS, registry code 16686123, registered address Reinu tee 48, Viljandi, Viljandi county 71020, e-mail address info@clevoninvestors.com (hereinafter the Issuer) is hereby making the current shareholders of Clevon AS, registry code 16472103 (hereinafter Clevon), a voluntary takeover offer in order to take over their shares with the objective of concentrating at least 90% + 1 of all Clevon shares in the hands of the Issuer.
If the voluntary takeover offer is successful, i.e., provided that the Issuer acquires a minimum of 90% + 1 of all shares of Clevon, and further provided that the Issuer succeeds in finding an investor who will finance the mandatory takeover of Clevon shares, the Issuer intends to merge Clevon with itself, in the course whereof the shares of Clevon held by the shareholders who did not participate in the voluntary takeover offer, will be taken over for fair compensation. The exact schedule and conditions for the execution of the merger depend on the results of the Offer and the finding of an investor.
The purpose of the Issuer's takeover of Clevon shares is to submit a request to Nasdaq Tallinn AS to discontinue trading in Clevon shares in the multilateral trading system First North (hereinafter First North) managed by Nasdaq Tallinn AS.
The Issuer was established by Clevon's shareholders for the specific purpose of termination of trading in Clevon's shares on First North. As of the submission of the Offer, the Issuer holds 88.06% of all Clevon shares.
The need for making the Offer
Clevon is a rapidly developing start-up company that is in constant need of additional capital for the development of its main product, i.e., the unmanned vehicle CLEVON 1 and the technology contained therein, as well as for the marketing of the vehicle.
By reason of world events (war in Ukraine, energy crisis, etc.), a situation has arisen in the financial markets, where successful public raising of additional capital by Clevon today and in any subsequent rounds of fundraising has become extremely difficult. Therefore, Clevon is now looking for potential investors outside of First North. Potential investors would be venture capital investors, potential customers of Clevon and other start-up companies in synergy with whom it would be possible to develop the CLEVON 1 vehicle further.
Communication with potential investors has revealed that in order to raise capital for further development from them, Clevon has to leave First North. The key reasoning for leaving First North as a prerequisite for any investment is that investment policies of potential investors include certain restrictions that do not allow them to invest in public companies. Furthermore, the information disclosure requirements associated with being listed on First North, the impossibility of granting preferential rights to larger investors (e.g., the right to appoint members of the management or the right of veto) and the dependence of the company's value on the price formed in the course of trading on First North could also create obstacles to raising capital.
The financial resources previously raised by Clevon are about to run out, and in order to continue its business, Clevon urgently needs additional capital. This capital is not publicly available in sufficient amounts. If Clevon fails to raise the required capital, there is a considerable risk that it would be impossible to further develop the business model of Clevon. The company is also likely to face payment difficulties, and insolvency cannot be ruled out either. In this respect, it is essential to point out that Clevon's business model still can be developed and it certainly has the potential to succeed, but as seeing that it is a business model which requires considerable resources, its further development is in constant need of additional funding. If this funding is found, there are no other apparent obstacles to the further development of Clevon's business model. Therefore, the above described risk of facing payment difficulties can be managed by raising additional capital. In this respect, the success of this Offer is in turn important for attaining such purpose.
Legal basis of the Offer
The Offer is an offer to the public within the meaning of Article 2(d) of Regulation (EU) 2017/1129 of the European Parliament and of the Council (hereinafter the Prospectus Regulation).
On the basis of the provisions of Article 3(2)(b) of the Prospectus Regulation and § 15(1) of the Securities Market Act (hereinafter VPTS), no prospectus will be published in respect of the Offer, seeing that the total volume of the Issuer’s Offer does not exceed 5,000,000 euros per all the Contracting States in total calculated in a one-year period.
The information document of the Offer (appended to this stock exchange announcement) has been prepared in accordance with the provisions of § 15(6) of VPTS and the Regulation No. 7 of the Minister of Finance of 21/02/2022 “Requirements for the information document for the offer of securities”. The information document does not constitute a prospectus within the meaning of the Prospectus Regulation or VPTS.
Content of the Offer
The Issuer's voluntary takeover offer is intended for those existing Clevon shareholders who wish to continue as shareholders of Clevon via the Issuer (hereinafter the Offer).
As part of the Offer, the Issuer proposes to Clevon's shareholders to exchange their Clevon shares for the Issuer's shares with the exchange ratio of 1:1, which in economic terms will take place by making a non-monetary contribution in the form of Clevon shares into the Issuer's share capital via AS LHV Pank.
The maximum total volume of the Offer is 5,000,000 euros.
Within the Offer, the Issuer will make it possible to exchange a total of up to 3,544,427 Clevon shares, against which the Issuer will issue the shareholders subscribing to the Offer up to 3,544,427 of its own shares. The price of the Issuer’s shares to be issued is determined as of the settlement date of the Offer (which is presumably also the date of making the non-monetary contribution) based on the ordinary value of Clevon shares.
The Offer will be executed on the terms and conditions set out in the Offer, which are described in more detail in the Offer information document appended to this stock exchange announcement.
The Offer is realised only in the Republic of Estonia and the Offer will not be available in any other jurisdiction.
In contrast to Clevon's stock exchange announcement published on 16/01/2023, the Issuer is not currently making an offer for the voluntary sale of Clevon's shares, because the Issuer's aim is not to take on additional debt obligations in this complicated economic situation, but to channel available funds into Clevon's business.
Offer Period
The Offer period begins on 31 March 2023 at 10:00 a.m. and ends on 21 April 2023 at 4:00 p.m. The shareholders of Clevon may submit transaction orders to participate in the Offer until 21 April 2023 3:00 p.m.
The Issuer has the right to extend or shorten the Offer period on the terms and conditions set out in the information document of the Offer.
The indicative schedule of the Offer is as follows:
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Start of the offer period: |
March 31, 2023 at 10:00 a.m. |
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Deadline for sending the instruction: |
April 21, 2023 at 3:00 p.m. |
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End of the offer period: |
April 21, 2023 at 4:00 p.m. |
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Determination and disclosure of Offer results: |
April 24, 2023 |
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Offer settlement: |
April 25, 2023 |
Steps required to accept the Offer
In economic terms, by participating in the Offer, Clevon shareholders commit to transfer their Clevon shares to the Issuer in the form of a free-of-payment delivery of securities, and to make a non-monetary contribution into the Issuer's share capital. The Issuer commits to transfer the Issuer’s shares against the Clevon shares on the business day following the Offer period. The non-monetary contribution into the Issuer's capital in the form of Clevon shares, and the transfer of the Issuer’s shares to the shareholders of Clevon in exchange for the Clevon shares will be intermediated by AS LHV Pank.
In order to transfer Clevon shares to AS LHV Pank, the shareholders of Clevon have to submit a transaction order to their securities account manager (e.g., LHV Pank, SEB Bank, Swedbank or another bank or other person entitled to provide investment services) for the transfer of their Clevon shares on the terms and conditions set out in the Offer information document. By placing the transaction order, the current shareholder of Clevon confirms their acceptance of the terms and conditions of the Offer as set out in the Offer information document.
A current shareholder of Clevon may amend or cancel their transaction order under the Offer in accordance with the procedure set out in the Offer information document.
Conditionality of the Offer
The Issuer has the right to cancel the Offer. The Issuer may do this, inter alia, if the Offer is undersubscribed, i.e., if as a result of the Offer the Issuer fails to acquire at least 90% + 1 of Clevon's shares.
The Issuer has the right to extend or shorten the Offer period.
If the Offer is oversubscribed, the Issuer will decide at its discretion on the distribution of the Issuer's shares among the Clevon shareholders who have accepted the Offer on or near the end date of the Offer period.
In the case of distribution, all investors will be treated equally under the same circumstances.
Law applicable to the Offer
The Offer and its information document will be governed by the law of the Republic of Estonia. Any disputes arising from and related to the Offer and its information document shall be settled at the Harju County Court, being the court of first instance.
Disclosure of Offer information
This voluntary takeover offer and the Offer information document will be published in the information system of Nasdaq Tallinn AS in the form of a stock exchange announcement and on the website (https://clevon.com/).
The Issuer has provided the following contact information for any additional information about the Offer:
Arno Kütt
Clevon Investors AS chairman of the management board
arno.kutt@clevon.com
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