OKEA ASA - Announcement of terms of the initial public offering

Ivar Assen Okea

Press release, Trondheim 24 May 2019

Further to the previously announced intention to apply for a listing on the Oslo Stock Exchange, the Board of Directors of OKEA ASA (the "Company" or "OKEA") has resolved to launch an initial public offering (the "Offering" or the "IPO"). Subject to approval of the listing application and successful completion of the Offering, the shares of OKEA (the "Shares") are expected to be admitted to trading on the Oslo Stock Exchange under the ticker code "OKEA" on or about 11 June 2019 (subject to any extension or shortening of the offer period).

Overview of the Offering

OKEA intends to raise gross proceeds of NOK 650 million to NOK 858 million (approx. USD 74 million to USD 98 million) through issuing up to 26,000,000 new shares (the "New Shares") in the Offering. The primary purpose of the Offering is to support the Company’s growth strategy and enable OKEA to accelerate its growth plans. The Offer Shares (defined below) will be offered for sale within an indicative price range of between NOK 25 and NOK 33 per Offer Share, corresponding to a pre-money equity value of OKEA of between approx. NOK 2,171 million and NOK 2,866 million (approx. USD 248 million to USD 327 million). The final price per Offer Share (the "Offer Price") may, however, be set within, above or below this indicative price range.

In connection with the IPO, certain existing shareholders, including members of the Company's management and OKEA Holdings Ltd. (controlled by Seacrest Capital Group) (the "Selling Shareholders"), will offer up to 4,180,000 Shares (the "Sale Shares") representing approx. 5% of the issued and outstanding Shares of OKEA before the Offering. Of this, members of the Company's management will offer up to 180,000 Shares, representing approx. 17% of the two individuals’ combined holding of Shares and approx. 11% of their total combined economic exposure including warrants and options. OKEA Holdings Ltd. (controlled by Seacrest Capital Group) will offer up to 4,000,000 Shares representing approx. 14% of its holding and retain the majority of its position of 28,753,310 shares prior to the Offering. Erik Haugane, CEO of OKEA, currently holds 821,340 Shares and will not offer any Shares for sale in the Offering.

In addition, and in order to permit stabilisation activities, the Managers may elect to over-allot a number of additional Shares equalling up to 15% of the New Shares allocated in the Offering (the "Additional Shares" and together with the New Shares and the Sale Shares, the "Offer Shares" (unless the context otherwise requires)). Assuming that the maximum number of Additional Shares are allocated, the Offering will comprise up to 34,080,000 Offer Shares, equivalent to a total transaction size of between approx. NOK 852 million to NOK 1,125 million (approx. USD 97 million to USD 128 million) (based on the indicative price range).

The New Shares will comprise up to approx. 23% of the total number of Shares in issue after the Offering, and together with the Sale Shares and the Additional Shares up to approx. 30% of the total number of Shares in issue after the Offering. Following the Offering, the free float is expected to be in the range of up to 36% to 39%.

For the purpose of enabling over-allotments (if any), BCPR Pte. Ltd. and OKEA Holdings Ltd. (the "Greenshoe Shareholders") will grant the Managers an option to borrow a number of Shares equal to the number of Additional Shares. Further, pursuant to a greenshoe option, the Managers will be granted an option to purchase from the Greenshoe Shareholders , a combined number of Shares up to the number of Additional Shares at a price equal to the Offer Price for the purpose of covering any short position created as a result of any over-allotment, and which are not otherwise covered through stabilisation activities.

The Selling Shareholders will receive the proceeds from the sale of the Sale Shares, and OKEA will receive the proceeds from the sale of the New Shares in the Offering. The Greenshoe Shareholders will receive the proceeds from any Shares purchased from them pursuant to exercising of the greenshoe option.

OKEA has agreed with the Managers to be subject to a lock-up period of 180 days. Members of the Company's management and board of directors have agreed on a lock-up period of 365 days, while the Selling Shareholders that are not members of management have agreed with the Managers on a lock-up period of 180 days. These lock-up agreements will be subject to certain exceptions and may only be waived with the consent of the Managers.

Offering details

The Financial Supervisory Authority of Norway is expected to approve the prospectus (the "Prospectus") for the IPO on or about 27 May 2019. The terms and conditions for the Offering, which will be further set out in the Prospectus, comprise:

(i) an institutional offering, in which Offer Shares are being offered (i) to institutional and professional investors in Norway, (ii) to investors outside Norway and the United States subject to applicable exemption from prospectus and registration requirements, and (iii) in the United States to a limited number of QIBs (as defined in Rule 144A under the U.S Securities Act) in transactions exempt from registration requirements under the U.S Securities Act. The institutional offering is subject to a lower limit per application of NOK 2,000,000; and

(ii) a retail offering, in which Offer Shares are being offered to the public in Norway, subject to a lower limit per application of an amount of NOK 10,500 and an upper limit per application of an amount of NOK 1,999,999 for each investor. Investors who intend to place an order in excess of NOK 1,999,999 must do so in the institutional offering. Multiple applications by one applicant in the retail offering will be treated as one application with respect to the maximum application limit.

Time line and offer period

The bookbuilding period in the institutional offering is expected to take place from 28 May 2019 at 09:00 hours (CET) to 6 June 2019 at 15:00 hours (CET). The application period in the retail offering is expected to take place from 28 May 2019 at 09:00 hours (CET) to 6 June 2019 at 12:00 hours (CET). The bookbuilding period and/or the application period may be shortened or extended.

The final number of Offer Shares and the Offer Price will be determined by OKEA, in consultation with the Managers, after completion of the bookbuilding period. The announcement of the Offer Price is expected to take place on the evening of 6 June 2019 or before 09:00 hours (CET) on 7 June 2019. Trading of the Shares on the Oslo Stock Exchange is expected to commence on or around 11 June 2019 at 09:00 hours (CET) under the ticker code "OKEA".

Conditions for the Offering

Completion of the Offering is conditional upon (i) the Board of Directors of the Oslo Stock Exchange approving the application for listing of the Shares in OKEA in its meeting expected to be held on 5 June 2019, (ii) OKEA, in consultation with the Managers, having approved the Offer Price, the number of Offer Shares and the allocation of the Offer Shares to eligible investors following the bookbuilding process, and (iii) the Board of Directors of OKEA resolving to issue the New Shares. There can be no assurance that these conditions will be satisfied.

Prospectus

The Prospectus will, subject to regulatory restrictions in certain jurisdictions, be available at www.okea.no, www.paretosec.com, www.seb.no and www.sb1markets.no, from the commencement of the bookbuilding period and the application period for the Offering, expected to take place from 28 May 2019 at 09:00 hours (CET). Hard copies of the Prospectus may also be obtained free of charge from the same date by contacting OKEA or one of the Managers.

Advisers

Pareto Securities AS, Skandinaviska Enskilda Banken AB (publ.), Oslo Branch and SpareBank 1 Markets AS are acting as Joint Global Coordinators and Joint Bookrunners in the IPO (collectively, the "Managers").

Advokatfirmaet Schjødt AS is acting as legal advisor to OKEA, and Arntzen de Besche Advokatfirma AS is acting as legal advisor to the Managers.