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    OBSRV   NO0010865009

OBSERVE MEDICAL ASA

(OBSRV)
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OBSERVE MEDICAL ASA: NOTICE OF EXTRAORDINARY GENERAL MEETING - FULLY UNDERWRITTEN RIGHTS ISSUE

01/14/2022 | 01:02am EST

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. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS STOCK EXCHANGE

The board of directors of Observe Medical ASA ("Observe Medical" or the "Company") has resolved to propose that the Company carries out a share capital increase, by way of a fully underwritten rights issue, to raise gross proceeds of NOK 180 million (the "Rights Issue"). The proceeds from the Rights Issue will partly be used to finance the cash portion of the acquisition consideration of Biim Ultrasound AS (NOK 50 million), cf. the separate stock exchange announcement published by the Company today, on 14 January 2022, simultaneously with this stock exchange announcement regarding Observe Medical entering into a definitive agreement for the acquisition of 100% of the shares in Biim Ultrasound AS. In addition, the proceeds will be used for commercialization and growth initiatives for Sippi® and Biim, repayment of current interest-bearing debt and general corporate purposes.

The proposed Rights Issue is subject to a shareholder approval at an extraordinary general meeting of the Company (the "EGM") to be held on 4 February 2022 at 10:00 hours (Oslo time) at the Company's offices in Dronning Eufemias gate 16, 0191 Oslo, Norway. The notice and agenda with appendices is attached hereto and available on www.observemedical.com.

Carnegie AS and DNB Markets, a part of DNB Bank ASA, have been engaged as managers for the Rights Issue (the "Managers"). Advokatfirmaet Thommessen AS is acting as legal advisor to the

Company in connection with the Rights Issue. Advokatfirmaet Schjødt AS is acting as legal advisor to the Managers in connection with the Rights Issue.

The Rights Issue is fully underwritten by certain existing shareholders of the Company, certain other investors and the Managers (the "Underwriters"), in accordance with an underwriting agreement dated 14 January 2022. Ingerø Reiten Investment Company AS ("IRIC"), the Company's second largest shareholder, has underwritten and pre-committed to subscribe for NOK 40 million in the Rights Issue. Pursuant to, and subject to, the terms and conditions set out in the underwriting agreement, the Underwriters who are existing shareholders in the Company have undertaken to vote their shares held at the time of the EGM in favour of inter alia the Rights Issue and all Underwriters have undertaken to guarantee on a several basis (not jointly) to subscribe for the shares offered in the Rights Issue, for a total underwritten amount of NOK 180 million. The shares in the Rights Issue which are not subscribed upon expiration of the subscription period (if any), will thus be subscribed by and allocated to the Underwriters. The Underwriters are entitled to a guarantee fee of 5% of their respective underwriting obligation.

The subscription price for the new shares to be issued in the Rights Issue, and thus the exact number of new shares and the exact amount of the share capital increase, will be determined by the board of directors, based on a recommendation from the Managers, the day prior to the EGM. The board of directors' resolution in this respect will be announced through a stock exchange announcement the day before the EGM, and then be reflected in the final proposed resolution to the EGM. Pursuant to the underwriting agreement, the subscription price in the Rights Issue shall be based on the theoretical ex rights price (TERP) based on the volume-weighted average price (VWAP) of the shares in the Company on Euronext Expand Oslo during the last three trading day prior to the date of the EGM, less a discount of at least 30%.

In connection with the Right Issue a prospectus will be prepared, which is subject to the approval by the Norwegian Financial Supervisory Authority. The prospectus will be published prior to the commencement of the subscription period and will form the basis for subscriptions in the Right Issue. Provided that the prospectus is approved by the Norwegian Financial Supervisory Authority in time, the subscription period for the Rights Issue will commence on 9 February 2022 and expire on 23 February 2022 at 16:30 hours (Oslo time). In the event that the prospectus is not approved in time to uphold this subscription period, the subscription period will commence on the second trading day on the Oslo Stock Exchange following the approval of the prospectus and expire at 16:30 hours (Oslo time) two weeks thereafter.

Pursuant to section 10-4 of the Norwegian Public Limited Companies Act, the shareholders of the Company at the date of the EGM will be granted a preferential right to subscribe for and be allocated the new shares in proportion to the number of shares in the Company they own as of that date, and will according to the board's proposal receive subscription rights proportionate to their existing shareholding as registered in the Company's shareholder register in the Norwegian Central Securities Depository (the VPS) at the expiry of 8 February 2022. Provided that a purchase of shares is made with ordinary T+2 settlement, shares purchased up to and including 4 February 2022 will give the right to receive subscription rights, whereas shares purchased from and including 7 February 2022, will not give the right to receive subscription rights. The subscription rights are expected to be tradable and listed on Euronext Expand Oslo from and including the first day of the subscription period and until 16:30 (Oslo time) two trading days prior to the expiry of the subscription period. Over-subscription and subscription without subscription rights will be permitted.

The following lock-up undertakings will be entered into in connection with the Rights Issue:

  • The Company for a period of 180 calendar days
  • The Board of Directors and Executive Management of the Company for a period of 360 calendar days
  • The Company's largest shareholder, Navamedic ASA, for a period of 180 calendar days
  • The Company's second largest shareholder, IRIC, for a period of 360 calendar days

Furthermore, the following selling shareholders of Biim Ultrasound AS will enter into lock-up undertakings upon the completion of the acquisition:

  • The selling shareholders of Biim, receiving consideration shares issued as part of the acquisition; JPB AS, ELI AS, JTT AS, US Holding AS, Seed Capital AS, Athend AS and CEO Rune Nystad constituting ~55% of the shareholding have agreed to a lock-up of 360 days; ~42% of the remaining shareholding have agreed to a lock-up of 180 days and the remaining ~3% is expected to agree to a lock-up of 180 days.

A further description of the Rights Issue and of other circumstances that must be considered upon subscription of shares in the Rights Issue will be included in the prospectus for the Rights Issue, which will be published no later than at the commencement of the subscription period and that will constitute the subscription material for the offering.

Included below is an indicative timeline for the Rights Issue:

4 February 2022: EGM

4 February 2022: Last day of trading in the shares including subscription rights

7 February 2022: First day of trading in the shares excluding subscription rights

8 February 2022: Record date for determination of the right to receive subscription rights

On or around 8 February 2022: Publication of the prospectus

On or around 9 February 2022: Commencement of the subscription period and first day of trading in the subscription rights

On or around 21 February 2022: Last day of trading in the subscription rights

On or around 23 February 2022: Last day of the subscription period

On or around 24 2022: Allocation of the offer shares

On or around 28 February 2022: Payment of the offer shares

On or around 3 March 2022: Registration of the share capital increase with the Norwegian Register of Business Enterprises

For further information about the Company, please contact:

Björn Larsson, CEO of Observe Medical,

Mobile: +46 76 620 17 25

E-mail: bjorn.larsson@observemedical.com

Per Arne Nygård, CFO of Observe Medical,

Mobile: +47 411 04 345

E-mail: perarne.nygard@observemedical.com

For information about the Rights Issue please contact the Managers:

Carnegie AS, tel +47 22 00 93 40

DNB Markets, tel +47 23 26 81 01

About Observe Medical

Observe Medical develops and markets and sells innovative hospital products that contribute to increased patient safety and a more efficient care system. The company's ambition is to drive growth by leveraging its expertise in sales and commercialization of its broad portfolio of medical technology products, mainly in the areas of Urine measurement, Anesthesiology/ICUs and wound care, in combination with targeted M&A. The company's headquarter is in Oslo, Norway and its operations is based out of Gothenburg, Sweden. Observe Medical has a direct sales organization in the Nordics and a distributor network internationally. Observe Medical's product Sippi® is the only automated digital urine meter with possibility for wireless data transfer to the hospital patient data management systems and hinders bacterial migration that can lead to urinary infections (SippCoat®). Sippi® is CE marked and is currently being launched with focus on selected markets and hospitals in Nordics and in Europe.

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. 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. The information contained in this announcement is for informational purposes only and does not purport to be full or completed. The Company does not intend to register any portion of this offering in the United States or to conduct a public offering in the United States. Copies of this announcement are not being, and should not be, distributed in or sent into the United States.

This announcement has been prepared on the basis that any offer of securities in any Member State of the European Economic Area, other than Norway, which has implemented the Prospectus Regulation (EU) (2017/1129, as amended, the "Prospectus Regulation") (each, a "Relevant Member State") will be made pursuant to an exemption under the Prospectus Regulation, as implemented in that Relevant Member State, from the requirement to publish a prospectus for offers of securities. Accordingly any person making or intending to make any offer in that Relevant Member State of securities which are the subject of the offering contemplated in this announcement, may only do so in circumstances in which no obligation arises for the Company or any of the Managers to publish a prospectus pursuant to Article 3 of the Prospectus Regulation or supplement a prospectus pursuant to Article 16 of the Prospectus Regulation, in each case, in relation to such offer. Neither the Company nor any of the Managers have authorised, nor do they authorise, the making of any offer of the securities through any financial intermediary, other than offers made by the Managers which constitute the final placement of the securities contemplated in this announcement. Neither the Company nor any of the Managers have authorised, nor do they authorise, the making of any offer of securities in circumstances in which an obligation arises for the Company or any Managers to publish or supplement a prospectus for such offer.

In the United Kingdom, this announcement 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"). This announcement 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.

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, and is the responsibility of, the Company. The Managers are acting exclusively for the Company 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 advice in relation to the contents of this announcement or any of the matters referred to herein.

Neither the Managers nor any of their respective 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 respective affiliates accepts any liability arising from the use of this announcement.

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 the Prospectus Regulation. 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 any such prospectus will, following publication, be available from the Company's registered office and, subject to certain exceptions, on the websites of Carnegie (ww.carnegie.no/ongoing-prospectuses-and-offerings) and DNB Markets (www.dnb.no/emisjoner).

Each of the Company, the Managers and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any statement contained in this announcement whether as a result of new information, future developments or otherwise.

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.

This information is considered to be inside information pursuant to the EU Market Abuse Regulation article 7 and is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act. This stock exchange announcement was published by Per Arne Nygård on 14 January 2022 at 07:00 CET on behalf of the Company.

https://news.cision.com/observe-medical-asa/r/observe-medical-asa--notice-of-extraordinary-general-meeting---fully-underwritten-rights-issue,c3486006

https://mb.cision.com/Main/19175/3486006/1520308.pdf

https://mb.cision.com/Public/19175/3486006/83bedd60f1d8a246.pdf

(c) 2022 Cision. All rights reserved., source Press Releases - English

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Financials
Sales 2020 2,96 M 0,34 M 0,34 M
Net income 2020 -36,9 M -4,23 M -4,23 M
Net Debt 2020 16,3 M 1,87 M 1,87 M
P/E ratio 2020 -6,23x
Yield 2020 -
Capitalization 404 M 46,3 M 46,3 M
EV / Sales 2019 1 155x
EV / Sales 2020 97,2x
Nbr of Employees 8
Free-Float -
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Managers and Directors
Bj÷rn Oskar Larsson Chief Executive Officer
Per Arne Nygard Chief Financial Officer
Terje Bakken Chairman
Kristin Nyberg Independent Director
Thomas GrŘnfeld Independent Director
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