Seeka announces capital raising to provide Balance Sheet Flexibility and pursue its Growth Strategy

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1 12 November 2018 Seeka announces capital raising to provide Balance Sheet Flexibility and pursue its Growth Strategy Capital raising Seeka Limited [NZX:SEK] has today announced a new capital raising strategy to be implemented over the course of the next 3 years, including a Rights Issue, an issuance of shares under a new Grower Share Scheme and an issuance of shares under Seeka s existing Employee Share Ownership Scheme. The purpose of this capital raising strategy is to strengthen its balance sheet and provide Seeka with the financial flexibility and freedom to pursue its growth strategy of becoming New Zealand s leading orchard-to-market business. The first step is for Seeka to undertake a fully underwritten pro rata renounceable Rights Offer commencing on 21 November 2018 and closing on 7 December This Rights Offer: Seeks to raise approximately NZ$50 million of new equity via a pro rata 1 for 1.5 Rights Offer at NZ$4.25 per share (fully underwritten by First NZ Capital Group Limited). Includes a bookbuild to be undertaken at the end of the Rights Offer period for any shortfall. As a consequence, shareholders not taking up all of their rights (including ineligible shareholders) may receive value for their rights not taken up. Seeka also announces its intention to introduce a new Grower Share Scheme and Employee Share Scheme in the first quarter of 2019 to further align the interests of Seeka, its employees and grower suppliers (many of whom are shareholders).

2 Chairman of Seeka, Fred Hutchings, said: We are excited about Seeka s plans for growth and our continual pursuit towards being New Zealand s leading orchard-to-market business. Seeka will use the capital raised to strengthen our balance sheet, repay bank debt, undertake planned capital expenditure and give us greater financial flexibility and freedom to deliver better value for our shareholders. Seeka intends to target net debt to normalised LTM EBITDA 1 of 1.5x 2.5x by the end of 2019, noting the requirement for flexibility from time to time given Seeka s seasonal investment cycle and the timeframe required for Seeka to implement and complete its capital raising strategy as noted above. Further sales of the Northland orchard portfolio are expected to take place in the next twelve months, which together with other initiatives will further reduce net debt during the 2019 financial year. Earnings Targets For FY2018, Seeka confirms its previous guidance of EBITDA of $24.0m to $25.0m, and NPAT of $6.5m to $7.2m on the basis set out in previous releases. For FY2019, Seeka is targeting EBITDA of $27.5 million to $28.5 million, assuming: Expected increases in kiwifruit volumes in 2019 (in particular gold kiwifruit). Normal operating conditions across Australia and New Zealand. Any material change in guidance will be advised to the market through NZX. In FY2019, Seeka expects to undertake approximately $32 million 2 of capital expenditure, which includes development of the Kerikeri and Oakside sites to improve capacity efficiency, development of long term lease orchards and maintenance capital expenditure. 1 Long Term Maintainable Earnings Before Interest Tax Depreciation and Amortisation. 2 FY19 Capital expenditure is based on investment in capacity at the Company s KeriKeri and Oakside -Te Puke facilities along with an allowance for normal capital maintenance expenditure and $6m for long term lease orchard development.

3 Rights Offer and Bookbuild Under the Rights Offer, eligible shareholders are entitled (but not obliged) to subscribe for 1 new share for every 1.5 existing shares held as at 5.00 pm on the record date of 20 November 2018, at an issue price of $4.25 per new share. This represents a 25.4% discount to the closing share price on the NZX on 9 November 2018 and a 17.0% discount to the theoretical ex-rights price (TERP) of $5.12 per share, post the Rights Offer, based on the preannouncement close of $5.70. Eligible shareholders may choose to take up all, some or none of their rights. Any rights that are not taken up (including rights of ineligible shareholders) will be offered for sale through a bookbuild at the end of the Rights Offer period. Eligible retail shareholders that have taken up all of their rights will have the opportunity to participate in this bookbuild alongside institutional investors. Rights will not be quoted on the NZX Main Board - there will be no licensed market on which shareholders can sell their rights. Full details of the Offer will be sent to eligible shareholders. Information on the Offer, including the Offer Document released on the NZX market announcement platform today, are available on Seeka s website or on the NZX by searching Seeka s stock code (SEK) at Entitlements under the Rights Offer will not be scaled up to a minimum holding. Entitlements to fractions of new shares will be rounded down to the nearest whole number. Existing NZ Shareholders will have a preferential position in the bookbuild should they wish to subscribe for more shares than their entitlement under the Rights Offer. Key Dates for the Rights Offer The record date for determining the entitlements to participate in the Rights Offer is 5.00pm on 20 November Seeka shares will trade ex-rights from 19 November Other key dates (which are subject to change) are as follows: Announcement: 12 November 2018

4 Seeka shares trade ex-rights from 19 November 2018 Record date for rights issue: 5.00pm on 20 November 2018 Dispatch of Rights Offer to Shareholders: 21 November 2018 Opening Date of Rights Offer: 21 November 2018 Closing Date of Rights Offer: 5.00pm on 7 December 2018 Shortfall Bookbuild: 11 December 2018 Allotment Date: 14 December 2018 Payment of any premium achieved in the Bookbuild: By 17 December 2018 Shareholders should consult their broker, solicitor, accountant, financial adviser, or other professional adviser with any questions about the Rights Offer and the capital raising strategy generally. Seeka has appointed First NZ Capital Securities Limited as lead manager of the capital raising, with the Offer fully underwritten by First NZ Capital Group Limited. Harmos Horton Lusk Limited has provided legal advice. New Grower Share Scheme Following the initial Rights Offer capital raising, Seeka intends to introduce a new Grower Share Scheme (GSS) to further align its interests with those of its grower suppliers. Up to 2,600,000 shares in aggregate will be issued for the benefit of growers who choose to participate in the GSS. The GSS requires shareholder approval, which will be sought at a shareholder meeting intended to be held in March A summary of the proposed key terms of the GSS are set out below: Offers to participate in the GSS will only be made to growers who are the registered owners of kiwifruit, kiwiberry or avocado orchards as determined by the Board. The shares will be issued to a scheme trustee with full dividend and voting rights at a price to be determined by Seeka and will be held on a Grower s behalf for 3 years. Growers will beneficially own the shares from the issue date (but will not be able to transfer or encumber their beneficial interest in the shares).

5 The issue price of the shares will be funded by limited recourse loans from Seeka to the scheme trustee (on the Growers behalf). The loan will be interest free and repayable only if the Grower elects to acquire the shares at the end of the 3-year period. During that 3-year period, any dividends paid by Seeka on the shares will be applied towards repayment of the loan. At the end of the 3 year period, the Grower will be transferred the shares provided: o the Grower has supplied all fruit from the orchard(s) registered for the GSS to Seeka; o the Grower makes an election to acquire the shares by the relevant due date; and o the Grower pays off the balance of the loan. If the Grower fails to supply all fruit from their registered orchard(s) or pay off the balance of the loan, the Grower will forfeit the shares being held by the scheme trustee on its behalf. The Grower will not be obliged to supply fruit or repay the loan. The only consequence of not doing so will be that the Grower does not get the shares. If the Grower s orchard(s) are sold, the Seller will be able to continue to participate in the GSS but must: o notify Seeka of the sale and the name(s) of the new owner(s); and o ensure the new owner(s) continues to supply all fruit from the orchard(s) to Seeka, otherwise the Grower will not be entitled to acquire the shares at the end of the 3-year period. Employee Share Ownership Scheme In 2019 Seeka also intends to issue Shares to employees under the existing Employee Share Ownership Scheme (ESS) to further align its interests with employees. An expected maximum of 700,000 shares in aggregate will be issued for the benefit of employees who are offered the option to participate in the ESS and that elect to do so. Offers to participate in the ESS will be made in accordance with the terms of Seeka s existing ESS and will not require shareholder approval. Further details about the intended issue of shares under the ESS shall be released in 2019.

6 Ends. For further information please contact: Michael Franks Seeka Chief Executive Stuart McKinstry Seeka Chief Financial Officer