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OR RELEASE WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF
ANY OF THE SECURITIES DESCRIBED HEREIN.
Oslo, 11 June 2025
Reference is made to the previous stock exchange announcement made by Observe
Medical ASA (the “Company” or “Observe Medical”, Euronext Expand ticker “OBSRV”)
regarding a contemplated private placement (the “Private Placement”) of new
shares in the Company (the “Offer Shares”). The Company is pleased to announce
that it has successfully placed and conditionally allocated 72,890,000 Offer
Shares in the Private Placement at a subscription price of NOK 0.50 per Offer
Share (the “Offer Price”) for gross proceeds totalling NOK 36,445,000, as
further described below.
SpareBank 1 Markets AS acted as manager in the Private Placement.
The net proceeds to the Company from the Private Placement will be used to buy
the remaining rights for the Unometer product family as well as for operating
liquidity currently expected to be needed to take the Company to cash positive.
Certain primary insiders and close associates of primary insiders have been
conditionally allocated Offer Shares as follows:
· R Investment Company AS (represented on the Company’s board of directors
(the “Board”) by Terje Bakken, chair of the Board): 8,000,000 Offer Shares
· Seed Capital AS (represented on the Board by Eskild Endrerud): 5,000,000
Offer Shares
· Glimt Invest AS (a company owned and controlled by chair of the Board Terje
Bakken): 2,350,000 Offer Shares
· Jørgen Mann, Company CEO: 800,000 Offer Shares
· Johan Magnus Fagerli, Company CFO: 340,000 Offer Shares
Navamedic ASA (“Navamedic”), the Company’s largest shareholder, has been
conditionally allocated 10 million Offer Shares through conversion of part of
its outstanding loans to the Company (the “Navamedic Conversion”). The Navamedic
Conversion is in addition to the agreement in principle between the Company and
Navamedic whereby Navamedic has agreed on a debt reduction of 50% of its
outstanding loans to the Company, subject to certain conditions, as announced in
the stock exchange announcement published by the Company on 10 April 2025. For
further information about the debt reduction, including the conditions for such
debt reduction, please refer to said stock exchange announcement.
Furthermore, Jiangsu Hongxin Medical Technology Co. Ltd. (“Jiangsu”), who is the
Company’s largest manufacturing partner, has been conditionally allocated 6
million Offer Shares through conversion or contribution of parts of its accounts
receivables towards the Company and/or its subsidiaries (the “Jiangsu
Conversion” and together with the Navamedic Conversion the “Debt Conversions”).
In addition, Jiangsu has agreed that that the Observe Medical group shall be
entitled to place additional orders with Jiangsu without an obligation to pay
the customary prepayment of USD 300,000 upon placing the order. Such payment
shall only be payable according to an agreed payment schedule. Notification of
conditional allocation is expected on or about 12 June 2025, before trading
commences on the Oslo Stock Exchange.
Payment (or settlement by way of set-off in terms of the Debt Conversions) for
the allocated Offer Shares is expected to take place following an extraordinary
general meeting in the Company, expected to be held on or about 3 July 2025 (the
“EGM”). Registration of the share capital increase resolutions relating to the
Private Placement in the Norwegian Register of Business Enterprises (the “NRBE”)
is, subject to timely payment of the entire cash subscription amount and timely
implementation of the Debt Conversions, expected on or about 7 July 2025, and
delivery of the Offer Shares is expected on or about 8 July 2025.
The Offer Shares will be registered with the Norwegian Central Securities
Depository Euronext Securities Oslo (the “VPS”) on a separate ISIN from the
existing shares of the Company, pending approval and publication by the Company
of a prospectus (the “Prospectus”) and will thus not be tradable on Euronext
Expand Oslo until the Prospectus has been approved by the Financial Supervisory
Authority of Norway (the “NFSA”) and published by the Company, upon which the
Offer Shares will be transferred to the Company’s ordinary ISIN in the VPS and
be admitted to trading on Euronext Expand Oslo. The Prospectus is expected to be
approved by the NFSA and published by the Company at the end of Q3 2025.
Completion of the Private Placement, by delivery of Offer Shares to investors,
is subject to the following conditions (together, the “Conditions”) being
satisfied: (i) all necessary corporate resolutions being validly made by the
Company, including (without limitation) the Board resolving to approve the
Jiangsu Conversion (based on the board authorisation), the annual general
meeting of the Company, scheduled to be held on 27 June 2025 (the “AGM”),
resolving the Proposed Share Capital Reduction (as defined below) and the EGM
resolving the issuance of the Offer Shares and the Navamedic Conversion
(together, the “General Meeting Resolutions”), (ii) the Debt Conversions being
completed no later than simultaneously with completion of the share issue for
cash consideration in the Private Placement, (iii) registration of the General
Meeting Resolutions in the NRBE, and (iv) the issuance of the Offer Shares in
the VPS. Investors being allocated Offer Shares in the Private Placement have
undertaken to vote in favour of the General Meeting Resolutions.
The Board has previously proposed that the Company’s share capital is reduced by
way of reduction of the nominal value of each share to NOK 0.42 (the “Proposed
Share Capital Reduction”), and reference is made to the notice of the AGM dated
6 May 2025 for further information regarding the Proposed Share Capital
Reduction.
The Board has carefully considered the Private Placement in light of the equal
treatment obligations under the Norwegian Public Limited Liability Companies
Act, the Norwegian Securities Trading Act and Oslo Børs’ guidelines on the rule
of equal treatment, and is of the opinion that the Private Placement is in
compliance with these requirements. It is in this respect relevant that the
Company has an immediate need of additional equity to finance its operations,
including operating liquidity currently expected to be needed to take the
Company cash positive. A rights issue would take substantially longer to
complete, which would not secure the Company required liquidity in time and
could significantly impair the Company’s situation. The Board has, in addition
to considering the possibility of conducting a rights issue, looked into other
financing alternatives (bank financing and direct lending) and concluded that
such alternatives are not available.
The Board will also propose to the EGM that it is granted an authorisation to
carry out a subsequent offering (the “Subsequent Offering”) of up to 24,000,000
new shares in the Company, directed at shareholders in the Company as of 11 June
2025 (as registered in Euronext Securities Oslo (VPS) two trading days
thereafter) who (i) were not included in the wall-crossing phase of the Private
Placement, (ii) were not allocated Offer Shares in the Private Placement, and
(ii) are not resident in a jurisdiction where such offering would be unlawful or
would (in jurisdictions other than Norway) require any prospectus, filing,
registration or similar action (the “Eligible Shareholders”). The Eligible
Shareholders will be granted non-transferable subscription rights to subscribe
for and be allocated new shares in the Subsequent Offering. The subscription
price in the Subsequent Offering will be equal to the Offer Price.
Oversubscription will be permitted, but subscription without subscription rights
will not be permitted.
The net proceeds from the Subsequent Offering will be used for operating
liquidity and general corporate purposes. The Subsequent Offering will be
conditional upon the approval of the EGM, as well as the completion of the
Private Placement. The application period for the Subsequent Offering is
expected to commence shortly after the publication of the Prospectus. The
Company will issue a separate stock exchange announcement with further details
on the Subsequent Offering.
Against this background, the Board has considered the Private Placement to be in
the common interest of the Company and its shareholders. Due to the structure of
the Private Placement, the shareholders’ preferential rights will be waived.
Based on the above, the Board has resolved to propose to the EGM that:
i. the Company’s share capital is increased by NOK 23,893,800 by issuance of
56,890,000 Offer Shares, each with a nominal value of NOK 0.42, at the Offer
Price, in connection with the Private Placement.
ii. the Company’s share capital is increased by NOK 4,200,000 by issuance of
10,000,000 new shares, each with a nominal value of NOK 0.42, at the Offer
Price, in connection with the Navamedic Conversion.
iii. the board of directors is granted an authorisation to increase the
Company’s share capital by up to NOK 10,080,000, by the issuance of up to
24,000,000 new shares, each with a nominal value of NOK 0.42, at the Offer
Price, in connection with the Subsequent Offering.
iv. the Board is granted an authorisation to increase the share capital by up to
NOK 7,740,466.44 (approximately 20% of the Company’s share capital following
completion of the Private Placements and the Debt Conversions) in order for the
Board to have flexibility to issue new shares in connection with acquisitions of
other companies or businesses, to secure an optimal capital structure for the
Company and to capitalise on potential growth opportunities, as well as to
finance further growth and the continued product development and
commercialisation of the Company’s business. It is proposed that the
authorisation may also be used to increase the share capital in connection with
share options and incentive schemes.
After registration of the Proposed Share Capital Reduction and the share capital
increases related to the Private Placement and the Debt Conversions, the
Company’s share capital will be NOK 38,702,333.04. The total number of shares in
the Company will be 92,148,412 shares, each with a nominal value of NOK 0.42.
Advokatfirmaet Thommessen AS is acting as Norwegian legal counsel to the Company
in connection with the Private Placement.
For additional information, please contact:
Jørgen Mann, CEO Observe Medical
Mobile: +45 408 67 558
E-mail: jorgen.mann@observemedical.com
Johan Fagerli, CFO Observe Medical
Mobile: +47 958 12 765
E-mail: johan.fagerli@observemedical.com
This information is considered to be inside information pursuant to the EU
Market Abuse Regulation and is subject to the disclosure requirements pursuant
to section 5-12 the Norwegian Securities Trading Act. This stock exchange
announcement was published by Johan Fagerli, CFO, on the time and date provided.
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 and ultrasound, in combination with targeted M&A and
distribution. Observe Medical is working with a network of leading distributors
to provide outstanding solutions for healthcare professionals globally.
The Company is headquartered in Oslo, Norway.
Further information is available at www.observemedical.com.
Important notice:
This announcement is not and does not form a part of any offer to sell, or a
solicitation of an offer to purchase, any securities of the Company. Copies of
this announcement are not being made and may not be distributed or sent into any
jurisdiction in which such distribution would be unlawful or would require
registration or other measures.
The securities referred to in this announcement have not been and will not be
registered under the U.S. Securities Act of 1933, as amended (the “Securities
Act”), and accordingly may not be offered or sold in the United States absent
registration or an applicable exemption from the registration requirements of
the Securities Act and in accordance with applicable U.S. state securities laws.
The Company does not intend to register any part of the offering in the United
States or to conduct a public offering of securities in the United States. Any
sale in the United States of the securities mentioned in this announcement will
be made solely to “qualified institutional buyers” as defined in Rule 144A under
the Securities Act.
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. The expression “Prospectus
Regulation” means Regulation (EU) 2017/1129 as amended (together with any
applicable implementing measures in any Member State.
This communication is only being distributed to and is only directed at persons
in the United Kingdom that are (i) 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) high net worth entities,
and other persons to whom this announcement may lawfully be communicated,
falling within Article 49(2)(a) to (d) of the Order (all such persons together
being referred to as “relevant persons”). This communication must not be acted
on or relied on by persons who are not relevant persons. Any investment or
investment activity to which this communication relates is available only for
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.
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 “believe”, “expect”, “anticipate”,
“strategy”, “intends”, “estimate”, “will”, “may”, “continue”, “should” 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 believe 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 their 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 Company does not make any
guarantee that the assumptions underlying the forward-looking statements in this
announcement are free from errors nor does it accept any responsibility for the
future accuracy of the opinions expressed in this announcement or any obligation
to update or revise the statements in this announcement to reflect subsequent
events. You should not place undue reliance on the forward-looking statements in
this announcement.
The information, opinions and forward-looking statements contained in this
announcement speak only as at its date, and are subject to change without
notice. The Company does not undertake any obligation to review, update,
confirm, or to release publicly any revisions to any forward-looking statements
to reflect events that occur or circumstances that arise in relation to the
content of this announcement.
Neither the Managers nor any of their 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. Neither the
Managers nor any of their affiliates accepts any liability arising from the use
of this announcement.
The distribution of this announcement and other information may be restricted by
law in certain jurisdictions. Persons into whose possession this announcement or
such other information should come are required to inform themselves about and
to observe any such restrictions.
Kilde
