XXL ASA: Commencement of subscription period for the share issue

NOT FOR DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA, HONG KONG OR JAPAN, OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.

Oslo, Norway, 4 May 2020: As  previously announced, XXL ASA ("XXL" or the "Company", OSE ticker code "XXL") will carry out a fully underwritten share issue (the "Share Issue") raising gross proceeds of approximately NOK 400 million through issuance of new shares (the "Offer Shares"). The subscription period will commence today, 4 May 2020.

Allocation of subscription rights:

The shareholders of the Company as of 24 April 2020 (as registered in the Norwegian Central Securities Depository (the "VPS") as at the expiry of 28 April 2020 pursuant to the two days' settlement procedure (the "Record Date")) (the "Existing Shareholders"), have been granted tradeable subscription rights (the "Subscription Rights") in the Share Issue that, subject to applicable law, provide a right to subscribe for, and be allocated, Offer Shares at the Subscription Price (as set out below).

Each Existing Shareholder has been granted 0.464 Subscription Right for every existing share registered as held by such Existing Shareholder as at the Record Date, rounded down to the nearest whole Subscription Right. Each Subscription Right will, subject to applicable law, give the right to subscribe for, and be allocated, one (1) Offer Share in the Share Issue. Over-subscription is permitted. Subscription without Subscription Rights is not permitted. Subscription Rights acquired during the trading period for the Subscription Rights carry the same rights as the Subscription Rights held by Existing Shareholders.

The grant or purchase of Subscription Rights and the subscription of Offer Shares by persons resident in, or who are citizens of countries other than Norway, may be affected by the laws of the relevant jurisdiction. For a further description of such restrictions, reference is made to Section 14 "Selling and Transfer Restrictions" in the prospectus dated 27 April 2020 prepared by XXL in connection with the Share Issue, as supplemented by the prospectus supplement dated 30 April 2020 (the "Prospectus").

Subscription period:

The subscription period for the Share Issue will commence today, 4 May 2020, at 09:00 hours (CEST) and expire on 18 May 2020 at 16:30 hours (CEST) (the "Subscription Period").

Subscription rights:

The Subscription Rights will be listed and tradable on the Oslo Stock Exchange from 09:00 hours (CEST) on 4 May 2020 to 16:30 hours (CEST) on 14 May 2020 under the ticker code "XXL T". The Subscription Rights will hence only be tradable during part of the Subscription Period.

Subscription Rights that are not used to subscribe for Offer Shares before the expiry of the Subscription Period, or sold before 16:30 (CEST) on 14 May 2020, will have no value and will lapse without compensation to the holder.

The Subscription Rights will have economic value if the Company's shares trade above the Subscription Price during the Subscription Period. Existing Shareholders who do not use their Subscription Rights will experience a dilution of their shareholding in the Company, see Section 6.21 "Dilution" of the Prospectus.

Subscription price:

NOK 5.00 per Offer Share.

Subscription procedure:

In order to subscribe for Offer Shares, investors need to complete the subscription form, and submit it to one of the subscription offices as set out in the Prospectus by 16:30 hours (CEST) on 18 May 2020. Subject to regulatory restrictions in certain jurisdictions, the Prospectus and the subscription form for the Share Issue may be downloaded from www.dnb.no/emisjoner and www.nordeamarkets.com/xxl.

A hard copy of the Prospectus and the subscription form may also be ordered by contacting DNB Markets Registrars Department (Tel.: +47 23 26 80 20) or Nordea Bank Abp, filial i Norge (Tel: +47 24 01 34 62).

Subscribers who are Norwegian residents with a Norwegian personal identification number who wish to subscribe for Offer Shares are encouraged to do so through the VPS online subscription system (or by following the link on www.dnb.no/emisjoner or www.nordeamarkets.com/xxl, which will redirect the subscriber to the VPS online subscription system).

Pre-commitments and underwriting:

Altor Invest 5 AS, Altor Invest 6 AS (together referred to as "Altor"), Ferd AS, ODIN Norden, ODIN Norge and Nordkronen II AS (Altor, Ferd AS, ODIN Norden, ODIN Norge and Nordkronen II AS together the "Underwriters") have, subject to certain customary conditions, committed to subscribe for at least their pro rata portion of the Share Issue (representing in aggregate 41.46% of the Share Issue), while the remaining part of the Share Issue is, subject to certain conditions, fully underwritten by Altor, Ferd AS and Nordkronen II AS.

The underwriting is governed by an underwriting agreement dated 31 March 2020, as amended on 22 April 2020 (the "Underwriting Agreement").

Pursuant to the Underwriting Agreement, the Share Issue is underwritten, severally and not jointly, by the Underwriters. The Underwriters have agreed, on the terms and conditions set out in the Underwriting Agreement, to secure the gross proceeds to the Company of NOK 400 million that is required under the Company's NOK 1,450 million debt refinancing.

The Underwriters' commitments under the Underwriting Agreement is distinguished between (i) a pre-commitment for the Underwriters' respective pro rata portion of the Share Issue by exercising their Subscription Rights (i.e. a pre-commitment to subscribe) which amounts to NOK 165,896,295 in total, and (ii) an obligation to subscribe for any Offer Shares that are not subscribed for by holders of Subscription Rights prior to expiry of the Subscription Period (i.e. an underwriting commitment) in the total amount of NOK 234,149,900. The Underwriters' respective commitment are described in section 6.22 "The Underwriting Agreement" of the Prospectus.

In the event that Altor Fund IV through Altor would otherwise become the owner of more than one third (1/3 or 33.33%) of the shares and votes in the Company as a result of allocation of Offer Shares, then Altor shall have the right to decide whether their obligation under such allocation shall be satisfied by:

  1. Altor taking delivery of the excess Offer Shares and thereby obtaining a combined shareholding in the Company in excess of the mandatory offer obligation under the Norwegian Securities Trading Act; or
  1. Altor or an affiliate of them providing to the Company an unsecured convertible bond loan (the "Convertible Loan") for the excess amount in order to avoid mandatory offer obligations to be triggered.

Each Underwriter's obligation to subscribe for and pay for unsubscribed Offer Shares, as applicable, is subject to the satisfaction or waiver of certain conditions, of which the following are still relevant:

  1. Fully underwritten: The Underwriters shall have agreed to underwrite the total underwriting commitment (i.e. the sum of the underwritten amounts of each Underwriter), and no underwriting commitments shall have been lawfully withdrawn.
  1. No Termination Event: There shall have been no event giving the Underwriters a right to terminate the Underwriting Agreement.

Prior to subscription for the unsubscribed Offer Shares in the Share Issue, Underwriters representing at least 2/3 of their total commitment may terminate the Underwriting Agreement on behalf of themselves and the other Underwriters by notice to the Company in the event that:

  1. the Company is in material breach of the Underwriting Agreement; or
  1. (i) there is any withdrawal of admission to listing of the Offer Shares or any suspension of, or limitation on prices for, trading in the existing Shares of the Company on the Oslo Stock Exchange (if such withdrawal, suspension or limitation occurs on, is continuing after or occurs after the date of the Underwriting Agreement), or in equity securities generally on the Oslo Stock Exchange, the London Stock Exchange, or the New York Stock Exchange; (ii) any declaration of a banking moratorium or suspension of payments in respect of banks generally in Norway, New York or the United Kingdom or with the respect to the European Central Bank; (iii) any change or developments involving a prospective change in the international financial markets, or in the financial markets of or in financial, political, monetary or economic conditions in Norway, the United Kingdom or the United States, or any outbreak or escalation of hostilities or any other calamity or crisis; (iv) any material change in currency exchange rates or foreign exchange controls, or a disruption of settlement systems or commercial banking in Norway, the United Kingdom or the United States; or (v) there has occurred a change or development involving a change in taxation affecting the Company, the Offer Shares or the transfer thereof, and the effect of any of the events described in (i) to (v), in the good faith opinion of the Managers (being DNB Markets, a part of DNB Bank ASA and Nordea Bank Abp, filial i Norge), is material and makes it impracticable or inadvisable to proceed with the Share Issue or the underwriting of the Offer Shares or materially and adversely affects dealings in the Offer Shares following the payment date (it being agreed that the shareholder structure in the Company following the Share Issue shall not be a relevant factor when considering whether dealings in the Offer Shares will be materially and adversely effected),

provided, however, that the Underwriting Agreement may only be terminated pursuant to sub-clause b) above if DNB Bank ASA and Nordea Bank Abp, filial i Norge does not participate in any utilisation, cancels any commitment or accelerate all or any part of any loan outstanding, in each case under any loan agreement between the Company and either bank as a result of a material adverse change (however described) due to Covid-19 related circumstances.

Should the Underwriting Agreement be terminated, the Underwriters will no longer be obliged to subscribe for unsubscribed Offer Shares, and the Share Issue will in such case lapse if the minimum number of Offer Shares offered have not been subscribed by the end of the Subscription Period.

See further information regarding the underwriting in Section 6.22 "The Underwriting Agreement" of the Prospectus.

Financial intermediaries:

If a shareholder held shares in the Company registered through a financial intermediary on the Record Date, the financial intermediary will, subject to the terms of the agreement between the shareholder and the financial intermediaries, customarily give the shareholder details of the aggregate number of Subscription Rights to which it will be entitled. The relevant financial intermediary will customarily supply each such shareholder with this information in accordance with its usual customer relations procedures. Shareholders who held their shares in the Company through a financial intermediary should contact the financial intermediary if they have received no information with respect to the Share Issue.

Listing and commencement of trading in the Offer Shares:

Due date for payment of the Offer Shares is 22 May 2020. Subject to timely payment of the entire subscription amount in the Share Issue, the Company expects that the share capital increase pertaining to the Share Issue will be registered with the Norwegian Register of Business Enterprises on or about 26 May 2020 and that the Offer Shares will be delivered to the VPS accounts of the subscribers to whom they are allocated on or about the same day. The Offer Shares are expected to be tradable on the Oslo Stock Exchange from and including 27 May 2020.

For further queries, please contact:

Investor Relations:

Tolle O. R. Grøterud

Tel: +47 90 27 29 59

E-mail:ir@xxlasa.com

About XXL ASA

XXL is a leading sports retailer with stores and e-commerce in Norway, Sweden, Finland, Denmark and Austria. It is the largest among the major sports retailers in the Nordics. XXL pursues a broad customer appeal, offering a one stop shop experience with a wide range of products for sports, hunting, skiing, biking and other outdoor activities. XXL’s concept is to have the largest stores with the best prices and the widest assortment of products, focusing on branded goods.

Important information

The release is not for publication or distribution, in whole or in part directly or indirectly, in or into Australia, Canada, Japan or the United States (including its territories and possessions, any state of the United States and the District of Columbia). This release is an announcement issued pursuant to legal information obligations, and is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act. It is issued for information purposes only, and does not constitute or form part of any offer or solicitation to purchase or subscribe for securities, in the United States or in any other jurisdiction. The securities mentioned herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "US Securities Act"). The securities may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the US Securities Act.

The Company does not intend to register any portion of the offering of the securities in the United States or to conduct a public offering of the securities in the United States. Copies of this announcement are not being made and may not be distributed or sent into Australia, Canada, Japan or the United States.

Any offering of the securities referred to in this announcement will be made by means of a prospectus. This announcement is an advertisement and is not a prospectus for the purposes of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on prospectuses to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (as amended) as implemented in any Member State. Investors should not subscribe for any securities referred to in this announcement except on the basis of information contained in the aforementioned prospectus. Copies of the prospectus is available from the Company's registered office and, subject to certain exceptions, on the websites of  DNB Markets, a part of DNB Bank ASA (www.dnb.no/emisjoner) and Nordea Bank Abp, filial i Norge (www.nordeamarkets.com/xxl) (jointly, the "Managers").

The issue, subscription or purchase of shares in the Company is subject to specific legal or regulatory restrictions in certain jurisdictions. Neither the Company nor the Managers assume any responsibility in the event there is a violation by any person of such restrictions. The distribution of this release may in certain jurisdictions be restricted by law. Persons into whose possession this release comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

The Managers are acting for the Company and no one else in connection with the Share Issue and will not be responsible to anyone other than the Company providing the protections afforded to their respective clients or for providing advice in relation to the Share Issue and/or any other matter referred to in this release.

Forward-looking statements: This release and any materials distributed in connection with this release may contain certain forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect the Company's current expectations and assumptions as to future events and circumstances that may not prove accurate. A number of material factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.