REG - tinyBuild, Inc. - Results of Placing

tinyBuildAnnouncement

21/12/2023 18:30

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RNS Number : 6916X  tinyBuild, Inc.  21 December 2023

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, TO OR
FOR THE ACCOUNT OR BENEFIT OF US PERSONS, AS DEFINED IN REGULATION S
PROMULGATED UNDER THE US SECURITIES ACT OF 1933, AS AMENDED (THE "US
SECURITIES ACT"), OR IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN,
NEW ZEALAND OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE
SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN
OFFER OF SECURITIES IN ANY JURISDICTION.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

For immediate release

21 December 2023

tinyBuild, Inc.

(the "Company" and together with its subsidiaries "tinyBuild" or the "Group")

 

Results of Placing, Private Placement, Subscription and intention to launch
Open Offer

 

tinyBuild (AIM:TBLD), a premium video games publisher and developer with
global operations, is pleased to announce that further to the announcement
earlier today (the "Launch Announcement"), the Company has conditionally
raised gross proceeds of US$12.0 million at 5 pence per share (the "Issue
Price") via:

·      A total of 31,416,902 Private Placement Shares having been
conditionally subscribed for by Atari at the Issue Price, raising gross
proceeds of US$2.0 million for the Company

·      A total of 153,080,000 Subscription Shares having been
conditionally subscribed for and a total of 4,000,000 Placing Shares having
been conditionally placed pursuant to the Placing and the Subscription at the
Issue Price, raising gross proceeds of US$10.0 million for the Company

Having agreed to underwrite the Open Offer pursuant to the terms of the
Subscription Agreement, Alex Nichiporchik, tinyBuild's CEO, may subscribe for
additional Subscription Shares depending on the level of take-up of
entitlements by qualifying stockholders in the Open Offer. This may increase
his current subscription for 153,080,000 Subscription Shares post the Open
Offer to between 54.0% and 59.1% of the enlarged issued share capital, subject
to the take-up in the Open Offer.

The Issue Price represents a premium of 100% to the closing price on 20
December 2023 (being the latest practicable time prior to the announcement of
the Placing). The net proceeds of the Placing are expected to be supplemented
by additional proceeds of up to US$2.16 million to be raised pursuant to the
Open Offer.

The net proceeds raised by the Company pursuant to the Placing, Private
Placement and Subscription are c.US$11.0 million and any additional funds
raised through the Open Offer shall be used for general working capital
purposes by the Company. Together the Placing, Private Placement, Subscription
and Open Offer are referred to as the "Fundraise".

Open Offer

Pusuant to the Open Offer, qualifying stockholders will have an opportunity to
subscribe for up to an aggregate of 33,979,706 Open Offer Shares at the Issue
Price, to raise up to c.US$2.16 million (before expenses), on the basis of 1
Open Offer Share for every 6 Shares held on the Record Date.

In addition, the Open Offer presents qualifying shareholders with an
opportunity, provided that they take up their Basic Entitlements in full, to
apply for additional Open Offer Shares through the Excess Application
Facility.

The Open Offer entitlements will be represented by the ISIN USU8884H1116,
along with Excess Open Offer entitlements under ISIN USU8884H1298.

Entitlements will not be listed to any exchange, and are expected to be
credited to the accounts of qualifying stockholders on or around the 27
December 2023. The Open Offer period is expected to operate until 11am on 17
January 2024.

The CEO cannot participate in the Open Offer but has the ability to take up
shares that are not subscribed for in the Open Offer through the Subscription.

The Open Offer is conditional on the passing of stockholder resolutions at a
special meeting of stockholders of the Company.

Further details on the Open Offer will be contained in the Circular, which is
expected to be posted to stockholders on or around 22 December 2023 and will
be available on the Company's website.

Conditional Fundraise and notice of Special Meeting

The Fundraise is conditional, inter alia, upon:

1)   the passing without amendment of all the Resolutions at the Special
Meeting;

2)   the Company having complied with its obligations and having satisfied
all conditions under the Placing Agreement, which fall to be performed on or
satisfied prior to Admission;

3)   Admission occurring by no later than 8.00 a.m. on 19 January 2024 or
such later time and date (being not later than 8.00 a.m. on 31 January 2024)
as Joh. Berenberg, Gossler & Co. KG ("Berenberg") and the Company may
agree;

4)   in the opinion of Berenberg acting in good faith there not having been
a material adverse change since the date of the Placing Agreement (whether or
not foreseeable at the date of the Placing Agreement).

As set out in detail in the Launch Announcement earlier today, the Fundraise
is conditional, inter alia, upon the passing of each of the Resolutions at the
Special Meeting.

 

A Special Meeting is therefore being convened at the offices of Goodwin
Procter (UK) LLP, 100 Cheapside, London EC2V 6DY, United Kingdom at 12 noon on
18 January 2024 for the purposes of seeking approval of the Resolutions. The
formal Notice of Special Meeting will be set out at the end of the Circular
which is expected to be posted to stockholders on or around 22 December 2023.

 

If the Resolutions are not passed at the Special Meeting, the Fundraise will
not take place and the proceeds of the Fundraise will not be received by the
Company.

If the Company does not receive the proceeds of the Fundraise, the Company
would have to again seek other forms of emergency financing.  Whilst the CEO
has indicated he is willing to support the Company, no terms have been agreed
beyond the proposed Subscription and the Company is unable to provide any
assurance that alternative financing could be secured.  Failure to secure
alternative forms of finance at all or on commercially acceptable terms could
have a material adverse effect on the Group's business, financial condition,
prospects, capital resources, cash flows, share price, liquidity, results
and/or future operations. In particular, failure to conclude the Fundraise
will materially compromise the Group's ability to meet its financial
obligations as they fall due and, in the opinion of the Board, likely result
in the Group entering into a chapter 11 bankruptcy or some other form of
insolvency procedure under which the prospects for recovery of value, if any,
by stockholders would be uncertain.

Application for Admission

Application will be made to the London Stock Exchange for the Placing Shares,
the Private Placement Shares, the Subscription Shares and such number of Open
Offer Shares as are subscribed for in the Open Offer to be admitted to trading
on AIM. Subject to, inter alia, approval of the Resolutions at the Special
Meeting, Admission is expected to take place, and dealings in the Placing
Shares, the Private Placement Shares the Subscription Shares and such number
of Open Offer Shares as are subscribed for are expected to commence, at 8.00
a.m. on 19 January 2024 (or such later time and/or date as may be agreed
between the Company and Berenberg, being no later than 8.00 a.m. on 31 January
2024). No temporary documents of title will be issued.

Capitalised terms not defined in this announcement have the meanings given to
them in the Launch Announcement.

 

Alex Nichiporchik, Chief Executive Officer of tinyBuild, commented:

 

"We are pleased to welcome Atari as a strategic investor of tinyBuild. Atari
is a timeless brand and its support validates the current strategic plan for
tinyBuild."

 

Wade Rosen, Chairman and CEO of Atari, commented:

"tinyBuild is an amazing company, with industry leading games and benefiting
from an expansive fan base. Atari is excited to participate in the current
capital transaction as tinyBuild's approach to the indie games market is in
line with Atari's long-term approach."

For further information please contact:

 tinyBuild, Inc                                  investorrelations@tinybuild.com (mailto:investorrelations@tinybuild.com)
 Alex Nichiporchik - Chief Executive Officer
 Giasone (Jaz) Salati - Chief Financial Officer
 Michael Schauble - Chief Commercial Officer

 Berenberg (Nominated Advisor and Sole Broker)   Tel: +44 (0) 20 3207 7800

 Mark Whitmore, Ciaran Walsh, Milo Bonser

 SEC Newgate (Financial PR)                      tinybuild@secnewgate.co.uk (mailto:tinybuild@secnewgate.co.uk)
 Robin Tozer, Harry Handyside, Molly Gretton     +44 (0)7540 106366

 

The person responsible for releasing this announcement is Giasone Salati,
Chief Financial Officer.

tinyBuild, Inc. LEI: 2138002FIMZYDVU3BD12

This Announcement should be read in its entirety.  In particular, you should
read and understand the information provided in the "Important Notices"
section of this Announcement.

 

Important Notices

No action has been taken by the Company, Berenberg or any of their respective
affiliates, or any person acting on its or their behalf that would permit an
offer of the Placing Shares or possession or distribution of this Announcement
or any other offering or publicity material relating to such Placing Shares in
any jurisdiction where action for that purpose is required. Persons into whose
possession this Announcement comes are required by the Company and Berenberg
to inform themselves about, and to observe, such restrictions.

 

No prospectus, offering memorandum, offering document or admission document
has been or will be made available in connection with the matters contained in
this Announcement and no such prospectus is required (in accordance with the
Prospectus Regulation (EU) 2017/1129 (the "Prospectus Regulation") or the
Prospectus Regulation as it forms part of UK domestic law by virtue of the
European Union Withdrawal Act 2018 (the "UK Prospectus Regulation") as
applicable)) to be published. Persons needing advice should consult a
qualified independent legal adviser, business adviser, financial adviser or
tax adviser for legal, financial, business or tax advice.

 

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED IN IT, IS RESTRICTED AND IS
NOT FOR PUBLICATION, RELEASE, FORWARDING OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES OF AMERICA, ITS
TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OR THE DISTRICT OF
COLUMBIA (COLLECTIVELY, THE "UNITED STATES"), AUSTRALIA, CANADA, THE REPUBLIC
OF SOUTH AFRICA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION,
RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL. FURTHER, THIS ANNOUNCEMENT IS FOR
INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF SECURITIES IN ANY
JURISDICTION. THIS ANNOUNCEMENT HAS NOT BEEN APPROVED BY THE LONDON STOCK
EXCHANGE, NOR IS IT INTENDED THAT IT WILL BE SO APPROVED.

 

This Announcement or any part of it does not constitute or form part of any
offer to issue or sell, or the solicitation of an offer to acquire, purchase
or subscribe for, any securities in the United States, Canada, Australia, the
Republic of South Africa, Japan or any other jurisdiction in which the same
would be unlawful. No public offering of the Placing Shares is being made in
any such jurisdiction.

 

The securities referred to herein have not been and will not be registered
under the United States Securities Act of 1933, as amended (the "Securities
Act"), or with any securities regulatory authority of any State or other
jurisdiction of the United States, and may not be offered, sold or transferred
directly or indirectly in or into the United States except pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and in compliance with the securities laws
of any State or any other jurisdiction of the United States. Accordingly, the
Placing Shares are being offered and sold by the Company only outside the
United States in "offshore transactions" (as such terms are defined in
Regulation S under the Securities Act ("Regulation S")) in accordance with,
and in reliance on, the safe harbour from registration provided by Rule
903(b)(3), or Category 3, of Regulation Sand otherwise in accordance with
applicable. The securities referred to herein are subject to the conditions
listed under Rule 903(b)(3), or Category 3, of Regulation S. Under Category 3,
offering restrictions (as defined under Regulation S) are in place and
additional restrictions are imposed on resales of the securities referred to
herein. Further, hedging transactions in the securities referred to herein may
not be conducted unless in compliance with the US Securities Act.  No public
offering of securities is being made in the United States.

 

This Announcement is for information purposes only and is directed only at
persons whose ordinary activities involve them in acquiring, holding, managing
and disposing of investments (as principal or agent) for the purposes of their
business and who have professional experience in matters relating to
investments and are:  (a) if in a member state of the European Economic Area
(the "EEA"), persons who are qualified investors, within the meaning of
Article 2(E) of the Prospectus Regulation ("Qualified Investors"); or (b) if
in the United Kingdom, 'Qualified Investors' within the meaning of Article
2(E) Of the UK Prospectus Regulation and who are also: (i) persons who fall
within the definition of "investment professionals" in Article 19(5) of the
Financial Services And Markets Act 2000 (Financial Promotion) Order 2005, as
amended (the "Order"), or (ii) persons who fall within Article 49(2)(a) to (d)
(high net worth bodies companies, unincorporated associations, etc) of the
Order, or (c) persons to whom it may otherwise be lawfully communicated, and
in all cases who are capable of being categorised as a professional client or
an eligible counterparty for the purposes of the FCA conduct of business
rules, (all such persons referred to in (a), (b) and (c) above together being
referred to as "Relevant Persons").

 

Any investment or investment activity to which this Announcement relates is
available in the EEA or the United Kingdom only to Relevant Persons and will
be engaged in only with Relevant Persons. This Announcement must not be acted
on or relied on by persons in the EEA or the United Kingdom who are not
Relevant Persons.

 

In Canada, no prospectus has been filed with any securities commission or
similar regulatory authority in respect of the Placing Shares. No such
securities commission or similar regulatory authority in Canada has reviewed
or in any way passed upon the merits of any proposed offering of the Placing
Shares and any representation to the contrary is an offence; no prospectus has
been lodged with, or registered by, the Australian Securities and Investments
Commission or the Japanese Ministry of Finance; the relevant clearances have
not been, and will not be, obtained for the South Africa Reserve Bank or any
other applicable body in the Republic of South Africa in relation to the
Placing Shares and the Placing Shares have not been, nor will they be,
registered under or offering in compliance with the securities laws of any
state, province or territory of Australia, Canada, the Republic of South
Africa or Japan. Accordingly, the Placing Shares may not (unless an exemption
under the relevant securities laws is applicable) be offered, sold, resold or
delivered, directly or indirectly, in or into Australia, Canada, the Republic
of South Africa, or Japan or any other jurisdiction in which such activities
would be unlawful.

 

This Announcement contains forward-looking statements. Forward-looking
statements are not historical facts but are based on certain assumptions of
management regarding our present and future business strategies and the
environment in which we will operate, which the Company believes to be
reasonable but are inherently uncertain, and describe the Company's future
operations, plans, strategies, objectives, goals and targets and expectations
and future developments in the markets. Forward-looking statements typically
use terms such as "believes", "projects", "anticipates", "expects", "intends",
"plans", "may", "will", "would", "could" or "should" or similar terminology.
Any forward-looking statements in this Announcement are based on the Company's
current expectations and, by their nature, forward-looking statements are
subject to a number of risks and uncertainties, many of which are beyond the
Company's control, that could cause the Company's actual results and
performance to differ materially from any expected future results or
performance expressed or implied by any forward-looking statements. As a
result, you are cautioned not to place undue reliance on such forward-looking
statements. Past performance should not be taken as an indication or guarantee
of future results, and no representation or warranty, express or implied, is
made regarding future performance. Some of the information is still in draft
form and will only be finalised, if legally verifiable, at a later date. The
Company undertakes no obligation to release the results of any revisions to
any forward-looking statements in this Announcement that may occur due to any
change in its expectations or to reflect events or circumstances after the
date of this Announcement, unless required to do so by applicable law or
regulation, and the parties named above disclaim any such obligation.

 

Berenberg and its affiliates may have engaged in transactions with, and
provided various commercial banking, investment banking, financial advisory
transactions and services in the ordinary course of their business with the
Company and/or its affiliates for which they would have received customary
fees and commissions. Berenberg and its affiliates may provide such services
to the Company and/or its affiliates in the future.

 

This Announcement has been issued by and is the sole responsibility of the
Company. No representation or warranty, express or implied, is or will be made
as to, or in relation to, and no responsibility or liability is or will be
accepted by Berenberg or by any of its affiliates or any person acting on its
or their behalf as to, or in relation to, the accuracy or completeness of this
Announcement or any other written or oral information made available to or
publicly available to any interested party or its advisers, and any liability
therefore is expressly disclaimed.

 

This Announcement does not constitute a recommendation concerning any
investor's investment decision with respect to the Placing. Any indication in
this Announcement of the price at which ordinary shares have been bought or
sold in the past cannot be relied upon as a guide to future performance. The
price of shares and any income expected from them may go down as well as up
and investors may not get back the full amount invested upon disposal of the
shares. Past performance is no guide to future performance. The contents of
this Announcement are not to be construed as legal, business, financial or tax
advice. Each investor or prospective investor should consult his, her or its
own legal adviser, business adviser, financial adviser or tax adviser for
legal, financial, business or tax advice.

 

The Placing Shares to be issued or sold pursuant to the Placing will not be
admitted to trading on any stock exchange other than the London Stock
Exchange.

 

Persons (including, without limitation, nominees and trustees) who have a
contractual or other legal obligation to forward a copy of this Announcement
should seek appropriate advice before taking any action.

 

Neither the content of the Company's website (or any other website) nor the
content of any website accessible from hyperlinks on the Company's website (or
any other website) is incorporated into or forms part of this Announcement.

 

This Announcement has been prepared for the purposes of complying with
applicable law and regulation in the United Kingdom and the information
disclosed may not be the same as that which would have been disclosed if this
Announcement had been prepared in accordance with the laws and regulations of
any jurisdiction outside the United Kingdom.

 

Berenberg is authorised and regulated by the German Federal Financial
Supervisory Authority and is authorised, and subject to limited regulation by,
the FCA in the United Kingdom. Berenberg is acting exclusively for the Company
and no one else in connection with the contents of this Announcement and other
matters described in this Announcement and will not regard any other person as
its client in relation to the content of this Announcement and other matters
described in this Announcement and will not be responsible to anyone other
than the Company for providing the protections afforded to its clients or for
providing advice to any other person in relation to the content of this
Announcement or any other matters referred to in this Announcement.

 

Notice to Distributors

 

UK Product Governance Requirements

Solely for the purposes of the product governance requirements contained
within the FCA Handbook Product Intervention and Product Governance Sourcebook
(the "UK Product Governance Rules"), and disclaiming all and any liability,
whether arising in tort, contract or otherwise, which any "manufacturer" (for
the purposes of the UK Product Governance Rules) may otherwise have with
respect thereto, the Placing Shares have been subject to a product approval
process, which has determined that the Placing Shares are: (i) compatible with
an end target market of retail investors and investors who meet the criteria
of professional clients and eligible counterparties as defined in paragraph 3
of the FCA Handbook Conduct of Business Sourcebook; and (ii) eligible for
distribution through all distribution channels to professional clients and
eligible counterparties (the "UK Target Market Assessment").

Notwithstanding the UK Target Market Assessment, distributors should note
that: the price of the Placing Shares may decline and investors could lose all
or part of their investment; the Placing Shares offer no guaranteed income and
no capital protection; and an investment in the Placing Shares is compatible
only with investors who do not need a guaranteed income or capital protection,
who (either alone or in conjunction with an appropriate financial or other
adviser) are capable of evaluating the merits and risks of such an investment
and who have sufficient resources to be able to bear any losses that may
result therefrom.

The UK Target Market Assessment is without prejudice to the requirements of
any contractual, legal or regulatory selling restrictions in relation to the
Placing. Furthermore, it is noted that, notwithstanding the UK Target Market
Assessment, Berenberg will only procure investors who meet the criteria of
professional clients and eligible counterparties.

For the avoidance of doubt, the UK Target Market Assessment does not
constitute: (a) an assessment of suitability or appropriateness for the
purposes of the UK Product Governance Requirements; or (b) a recommendation to
any investor or group of investors to invest in, or purchase, or take any
other action whatsoever with respect to the Placing Shares.

Each distributor is responsible for undertaking its own target market
assessment in respect of the Placing Shares and determining appropriate
distribution channels.

Capitalised terms used but not defined in this Announcement have the meaning
given in the Placing Announcement unless otherwise stated.

The information below set out in accordance with the requirement of Market
Abuse Regulation (EU) NO. 596/2014, including as it forms part of domestic law
in the United Kingdom by virtue of the European Union (Withdrawal) Act 2018
provides further detail.

 

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