OBSERVE MEDICAL ASA – Terms of the rights issue
NOT FOR DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, THE HONG KONG SPECIAL ADMINISTRATIVE REGION OF THE PEOPLE'S REPUBLIC OF CHINA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL. OTHER RESTRICTIONS ARE APPLICABLE. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT.
Reference is made to the stock exchange announcement published by Observe Medical ASA (the "Company") on 1 November 2023, regarding a proposed rights issue of shares (the "New Shares") with subscription rights for existing shareholders (the "Rights Issue"), which is subject to the approval by the extraordinary general meeting of the Company to be held at 09:00 (CET) on 22 November 2023 (the "EGM") as further described in the notice to the EGM published on 1 November 2023.
The Company's board of directors has today, on 21 November 2023, based on a recommendation from Sparebank 1 Markets (acting as "Manager" in the Rights Issue), determined the following proposed (i) subscription price, (ii) minimum and maximum number of New Shares, and (iii) minimum and maximum share capital increase pertaining to the Rights Issue:
- The subscription price is proposed to be NOK 0.26 per New Share, based on a theoretical ex rights price (TERP) of NOK 0.35 of the Company's shares calculated on the basis of (i) the volume-weighted average price (VWAP) of the Company's shares on the Oslo Stock Exchange (Euronext Expand) during the three trading days from 16th November to 20th November 2023 (NOK 0.71433), and (ii) the assumed issue of the maximum number of New Shares in the Rights Issue (equal to the number of subscription rights to be issued). And,
- The share capital of the Company is proposed to be increased by minimum NOK 18,000,000.20 million and maximum NOK 54,999,999.86 million through the issue of minimum 69,230,770 New Shares and maximum 211,538,461 New Shares, representing a ratio of 3.9546 New Shares per each existing share (assuming issue of the maximum number of New Shares).
The Company will raise between approximately NOK 18 million and approximately NOK 55 million in gross proceeds in connection with the Rights Issue.
In 2023 the Company has received loans from its largest shareholders (listed in Appendix 4 ("Lenders") in the notice of Extraordinary General Meeting) with an aggregate nominal value of NOK 16.75 million, and NOK 20.186 million included accrued interest and interest that will accrue up to and including the agreed maturity date. As previously announced by the Company, the Lenders may choose to utilize the Loans (including accrued and unaccrued interest calculated up to and including the agreed maturity date) fully or partly to set-off against the subscription amount to be paid upon any subscription of shares in the Company during the terms of the Loans. As a result, the subscription amount for the new shares may be settled by both cash and by way of set-off against shareholder loans. However, it is a condition for the Lenders to be permitted to convert the Loans in the Rights Issue that the Company raises gross proceeds in cash of a minimum of NOK 18,000,000.20.
It is a condition for completion of the Rights Issue that (i) the Company raising gross proceeds in the Rights Issue of minimum NOK 18,000,000.20 in cash and (ii) that each of the Lenders convert the Loans in whole and/or enter into an amendment agreement for the remaining amount under each of the respective Loans that are not converted regarding extension of the maturity date and amendment of the terms to market terms.
Each existing shareholder as of 22 November 2023 (as registered in Euronext Securities Oslo, the Norwegian Central Securities Depository (ESO) as at the expiry of 24 November 2023 (the record date)) will be granted 3.9546 subscription rights for each share in the Company registered as held by the shareholder. The number of subscription rights granted to each existing shareholder will be rounded down to the nearest whole subscription right. Each subscription right will, subject to applicable securities laws, give the right to subscribe for and be allocated one (1) New Share in the Rights Issue.
The proposal to increase the share capital of the Company as set out in the notice of the EGM dated 1 November 2023 will be adjusted to reflect the (i) subscription price, (ii) the number of minimum and maximum new shares and (iii) the minimum and maximum share capital increase pertaining to the Rights Issue as set out above. For further information regarding the Rights Issue, see the notice of the EGM available on www.observemedical.com.
If the Rights Issue is withdrawn, all subscription rights will lapse without value, any subscriptions for, and allocations of, New Shares that have been made will be disregarded and any payments for New Shares made will be returned to the subscribers without interest or any other compensation. The lapsing of subscription rights will be without prejudice to the validity of any trades in subscription rights, and investors will not receive any refund or compensation in respect of subscription rights purchased in the market.
The full terms and conditions of the Rights Issue will be included in the prospectus, which will be published prior to the commencement of the subscription period in the Rights Issue, expected to take place from 28 November 2023 to 12 December 2023 at 16:30 (CET).
Sparebank 1 Markets is acting as manager for the Rights Issue. Advokatfirmaet Thommessen AS is acting as legal counsel to the Company.
For further information about the Company, please contact:
Rune Nystad, CEO Observe Medical
Mobile: +47 916 24 683
E-mail: [email protected]
Per Arne Nygård, CFO Observe Medical
Mobile: +47 411 04 345
E-mail: [email protected]
This information is considered to be inside information pursuant to the EU Market Abuse Regulation (MAR) and is subject to the disclosure requirements pursuant to MAR article 17 and section 5-12 of the Norwegian Securities Trading Act.
This stock exchange announcement was published by Per Arne Nygård, CFO on 21 November 2023 at 13:55 (CET) on behalf of the Company.
About Observe Medical
Observe Medical is a Nordic medtech company that develops, markets and sells innovative medtech products for the global market. The Company is committed to improving patient welfare and patient outcomes, improving clinical data accuracy and promoting positive health economics.
The Company seeks to drive growth by leveraging its expertise in sales and commercialization of its broad portfolio of medical technology products, mainly in urine measurement, ultrasound, anesthesiology/ICUs, surgery and wound care, in combination with targeted M&A.
The Company is headquartered in Oslo, Norway, with additional offices in Narvik, Norway and Gothenburg, Sweden, and subsidiaries in Finland and the US. In addition, Observe Medical has a direct sale organization in the Nordics and a distributor network internationally.
Further information is available at www.observemedical.com.
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- IMPORTANT INFORMATION -
This announcement does not constitute an offer of securities for sale or a solicitation of an offer to purchase securities of the Company in the United States or any other jurisdiction. Copies of this document may not be sent to jurisdictions, or distributed in or sent from jurisdictions, in which this is barred or prohibited by law. The securities of the Company may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act").
The securities of the Company have not been, and will not be, registered under the U.S. Securities Act. Any sale in the United States of the securities mentioned in this communication will be made solely to "qualified institutional buyers" as defined in Rule 144A under the U.S. Securities Act. No public offering of the securities will be made in the United States.
Any offering of the securities referred to in this announcement will be made by means of a prospectus (the "Prospectus") which will be prepared and which is subject to the approval by the Norwegian Financial Supervisory Authority. 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 EA Member State (the "Prospectus Regulation"). Investors should not subscribe for any securities referred to in this announcement except on the basis of information contained in the Prospectus. Copies of the Prospectus will, following publication, be available from the Company's registered office and, subject to certain exceptions, on the websites of the Manager and the Company.
In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Regulation, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State.
In the United Kingdom, this communication is only addressed to and is only directed at Qualified Investors who (i) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order") or (ii) are persons falling within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations, etc.) (all such persons together being referred to as "Relevant Persons"). These materials are directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this announcement relates is available only to Relevant Persons and will be engaged in only with Relevant Persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.
This document is not for publication or distribution in, directly or indirectly, Australia, Canada, Japan, the United States or any other jurisdiction in which such release, publication or distribution would be unlawful, and it does not constitute an offer or invitation to subscribe for or purchase any securities in such countries or in any other jurisdiction. In particular, the document and the information contained herein should not be distributed or otherwise transmitted into the United States or to publications with a general circulation in the United States of America.
The Manager is acting for the Company in connection with the Rights Issue and no one else and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients or for providing advice in relation to the Rights Issue or any transaction or arrangement referred to in this announcement.
Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as "anticipate", "believe", "continue", "estimate", "expect", "intends", "may", "should", "will" and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The information, opinions and forward-looking statements contained in this announcement speak only as at its date and are subject to change without notice. This announcement is made by and is the responsibility of, the Company. Neither the Manager nor any of its affiliates makes any representation as to the accuracy or completeness of this announcement and none of them accepts any responsibility for the contents of this announcement or any matters referred to herein.
This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy, fairness or completeness. Neither the Manager nor any of its affiliates accepts any liability arising from the use of this announcement.
