Enclosed please find Hiddn Solutions ASA's report for the second quarter of
2019.
Important events in the second quarter of 2019 and year-to date
· Significant changes in the Group's operations
The subsidiary, Hiddn Security AS, reported lower operating revenue than
budgeted and continued loss making during first quarter of 2019. This negative
trend increased in second quarter of 2019. A new assessment of future sales
and probabilities to find bases for a profit-making business was performed. The
conclusion from the assessment was that this would involve unacceptable risk and
call for additional future funding. Hence, Hiddn Security AS had to enter a
petition for bankruptcy proceedings with Oslo enforcement, bankruptcy and
probate Court. The petition was filed 21 May 2019.
· Changes in management
Carl Espen Wollebekk resigned from his position as CEO in July 2019. Chairman of
the Board Mr. Øystein Tvenge acted as CEO on a temporary basis until Jørgen
Waaler was appointed as CEO for the Company through a part-time management for
hire agreement effective from 1 August 2019.
· Recapitalization efforts - secured commitments in a private placement
On 3 July 2019, the Company announced that it was insolvent and operated at a
loss. Notwithstanding the situation, the Board of Directors considered that
there were grounds to continue a process, safeguarding creditor interests,
whereby exploring possibilities for the Company, which could also be in the
shareholders' interests.
On 17 July 2019, the Company announced that it had received commitments in a
contemplated private placement towards certain existing shareholders and new
investors. The aggregate subscription amount committed was NOK 8.6 million. The
private placement is subject to approval from a shareholder meeting in the
Company to take place on 4 September 2019.
· Strategic initiatives and growth opportunities
The Company worked with various strategic alternatives, including a possible
business combination with Tactilis Pte Ltd, Energos Group and Ayfie Group
respectively. As announced by the Company, these initiatives were terminated
due to the financial situation in the Company.
The private placement to be approved by the shareholder meeting on 4 September
2019, has secured the Company with sufficient funds to cover all outstanding
debt as well as working capital to pursue new strategic opportunities to add new
business to the Group and with the possibility to create interesting
opportunities for growth and value creation going forward.
***
For further information, please contact:
Jørgen Waaler (CEO), telephone: +47 605 90 010 /e-mail: jorgen@waaler.no