Company announcement no. 10/2010 Page 1 of 5 Not for release, publication or distribution in Australia, Canada, Japan or the United States This announcement does not constitute an offer to sell or the solicitation of an offer to buy the securities of TK Development A/S (the Securities ) in Australia, Canada, Japan or the United States or in any other jurisdiction. The securities may not be offered or sold in the United States absent registration or an exemption from the registration obligation under the U.S. Securities Act of 1933, as amended. has not registered and does not intend to register the Securities or any portion thereof in the United States or in any other jurisdiction outside Denmark and does not intend to make a public offering of the Securities, whether directly or indirectly, in the United States or any other jurisdiction outside Denmark. publishes a prospectus today for a rights issue of 14,021,905 new shares of DKK 15 nominal value each at DKK 15 per new share Today, (the Company ) publishes a prospectus relating to the offer of 14,021,905 new shares with preemptive rights to the Company s existing shareholders (the Offering ) pursuant to a resolution to increase the Company s share capital adopted by the shareholders at the Company s extraordinary general meeting held on 1 July 2010. Reference is made to the prospectus in its entirety for a description of the Company and the Offering. The new shares are offered to the Company s existing shareholders at the subscription ratio of 1:2, meaning that one (1) preemptive right will be granted for each existing share held, and two (2) preemptive rights will be required to subscribe for one (1) new share against payment of the subscription price of DKK 15 per new share. The Company expects to receive gross proceeds from the Offering of DKK 210.3 million, and net proceeds of approximately DKK 198.3 million after deduction of estimated costs in connection with the Offering. Reasons for the Offering Management reviews the capital structure of TK Development on a regular basis, as well as the need for any adjustments. Management s overall aim is to provide a capital structure that supports the Company s long term growth, while at the same time ensuring the best possible relation between equity and loan capital and thus maximising the return for the shareholders. Management believes that the present cash flows and equity base of TK Development will be sufficient to execute the projects currently in progress, also without selling any of the completed projects. Moreover, it is expected that the projects which have been fully financed, either by bank loans or by forward funding, can be executed. In order to initiate the development and construction of additional projects and thus exploit the project opportunities, management assesses that a capital injection of about DKK 200 million will be necessary and will provide an opportunity to increase shareholder returns. These expectations are based on several specific projects for which the Company would like to secure the rights at
Company announcement no. 10/2010 Page 2 of 5 the current price level. Management expects that this will help the Company gain faster access to projects with a higher anticipated return than that offered by most of the existing ongoing projects in the portfolio. The scope of additional projects initiated will, apart from the capital injection, also depend on the future sale of completed projects, general market conditions, etc. Advance commitments and underwriting A group of existing shareholders has made advance commitments to TK Development, subject to the satisfaction of certain conditions, to exercise preemptive rights allocated on the basis of the existing shares held by each of them to subscribe for a total of 3,870,676 new shares corresponding to total gross proceeds of DKK 58.1 million. Furthermore, a number of investors have made underwriting commitments to the Company, subject to the satisfaction of certain conditions, to subscribe, in proportion to their underwriting commitments, for up to 10,152,884 new shares at the subscription price which have not been subscribed for by the existing shareholders pursuant to preemptive rights allocated or by investors pursuant to preemptive rights acquired on expiry of the subscription period, corresponding to total gross proceeds of DKK 152.3 million. Consequently, the company has received advance and underwriting commitments to subscribe for at total of 14,023,560 new shares corresponding to more than the total number of shares in the Offering. Terms and conditions of the offering Offering and subscription ratio The offering comprises 14,021,905 new shares of DKK 15 nominal value each, which are offered with preemptive rights to existing shareholders. The new shares are offered with preemptive rights to the existing shareholders of TK Development A/S at the ratio of 1:2, meaning that one (1) preemptive right will be allocated for each existing share held, and that two (2) preemptive rights will entitle the holder to subscribe for one (1) new share. Capital reduction Subject to the completion of the Offering, the share capital will be reduced by a nominal amount of DKK 140,219,050 by reducing the denomination of the shares from DKK 20 nominal value to DKK 15 nominal value. The capital reduction will take place concurrently with the registration of the capital increase related to the Offering with the Danish Commerce and Companies Agency. The completion of the Offering is subject to the final completion and registration of the capital reduction.
Company announcement no. 10/2010 Page 3 of 5 Trading in preemptive rights The preemptive rights can be traded on NASDAQ OMX Copenhagen A/S from 9 August 2010 at 9.00 a.m. CET to 20 August 2010 at 5 p.m. CET. Holders of preemptive rights wishing to sell their preemptive rights should instruct their custodian bank or other financial intermediary accordingly. Subscription price The new shares are offered at DKK 15 per share with a nominal value of DKK 15. Subscription period The new shares may be subscribed for from 12 August 2010 at 9.00 a.m. CET to 25 August 2010 at 5 p.m. CET. Listing of the new shares The new shares will, following registration with the Danish Commerce and Companies Agency, be admitted to trading and official listing under the ISIN code of the existing shares, which is expected to take place on 31 August 2010. Expected timetable Last day of trading in existing shares cum preemptive rights: First day of trading in existing shares ex preemptive rights: Trading period for preemptive rights commences: Allocation time for preemptive rights: Subscription period for new shares commences: Trading period for preemptive rights closes: Subscription period for new shares closes: Completion of the capital reduction and the Offering: 6 August 2010 9 August 2010 9 August 2010 at 9.00 a.m. CET 11 August 2010 at 12.30 p.m. CET 12 August 2010 at 9.00 a.m. CET 20 August 2010 at 5 p.m. CET 25 August 2010 at 5 p.m. CET The Offering will be completed only if and when the new shares subscribed for are issued by the Company after registration of the capital increase and simultaneous registration of the capital reduction with the Danish Commerce and Companies Agency, expected
Company announcement no. 10/2010 Page 4 of 5 to take place on 27 August 2010 Announcement of the results of the Offering: Date of admission of the new shares to trading and official listing under the ISIN code of the existing shares: Expectedly two business days after the end of the subscription period, expected to take place on 27 August 2010 Expected to take place on 31 August 2010 Lead Manager Nordea Markets (Division of Nordea Bank Danmark A/S) is the Lead Manager in connection with the Offering. Prospectus Requests for copies of the prospectus containing detailed information about TK Development and the complete terms and conditions of the Offering may be addressed to: Nordea Bank Danmark A/S Securities Operations / HH 7324 PO Box 850 0900 Copenhagen C Denmark Tel.: +45 33 33 50 92 Fax: +45 33 33 31 82 E mail: prospekt.ca@nordea.com The prospectus will also be available from the Company s offices in Aalborg and can, subject to certain exceptions, including prohibition on access by persons located in the United States, be downloaded from the Company s website: http://www.tk development.dk/. The contents of the website do not form part of the prospectus. Any questions you may have to this announcement may be addressed to Frede Clausen, President and CEO, on tel. +45 8896 1010. This announcement has been prepared in a Danish language and an English language version. In the event of discrepancies, the Danish version shall prevail. Forward looking statements This announcement contains certain forward looking statements, including statements concerning TK Development s business and the Offering. Such forward looking statements are based on information, assumptions and beliefs deemed reasonable by the company. They may change or be changed due to uncertainty relating to the
Company announcement no. 10/2010 Page 5 of 5 economic, financial, competitive, regulatory and marketing environment. In addition, the Company s business activities and its ability to meet its goals may be adversely affected if one or more of the risks that are set forth in the prospectus prepared by the Company for the Offering should materialise, or if other risks, currently unforeseen or considered insignificant, materialise. TK Development does not undertake to achieve the objectives stated in the prospectus and does not give any assurance that it will achieve the objectives set forth in the prospectus. Investors should carefully consider each of the risk factors described in the prospectus before making any investment decision.