IRRAS intends to carry out a rights issue of up to SEK 215 million

NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, JAPAN, SOUTH AFRICA OR AUSTRALIA OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL

Stockholm, (July 4, 2022) – IRRAS AB (publ) (“IRRAS” or the “Company”), (Nasdaq Stockholm: IRRAS), hereby announces that the Board of Directors has resolved on a new issue of shares corresponding to up to SEK 215 million with preferential rights for the Company’s existing shareholders (the “Rights Issue”). The Rights Issue is subject to approval by an extraordinary general meeting, to be held on August 3, 2022 (the “EGM”). The notice to the EGM will be announced through a separate press release.

Summary

• The purpose of the Rights Issue is to ensure a successful implementation of the Company’s growth strategy, including financing of its ongoing operations and the continued commercialization of its product portfolio.
• For each existing share held on the record date, one (1) subscription right is received. The subscription right entitles the holder to subscribe for new shares with preferential right, whereby one (1) subscription right gives the right to subscribe for nine (9) new shares, i.e. a subscription ratio of 9:1.
• The subscription price has been set to SEK 0.3 per share which, assuming that the Rights Issue is fully subscribed, amounts to issue proceeds of approximately SEK 215 million before the deduction of transaction costs.
• The Rights Issue comprises a maximum of 715,332,060 shares.
• Bacara Holdings Ltd and Lexington Holding Assets Ltd have undertaken to subscribe for shares representing up to their pro rata share of the Rights Issue (approximately 27.5 percent) conditional on that their combined ownership after the Rights Issue does not represent a shareholding of 30 percent or more. A Swedish institutional shareholder has undertaken to subscribe for shares representing up to their pro rata share of the Rights Issue, provided that the Rights Issue is not subscribed for up to SEK 180 million through subscriptions with or without subscription rights or through allocation under the guarantee undertaking described below, and that their ownership after the Rights Issue does not surpass their current shareholding.
• Spetses Investments Limited, an investment vehicle managed by Levant Capital (in which Marios Fotiadis is a director of the board[1]), has undertaken to guarantee approximately 46.6 percent of the Rights Issue, corresponding to SEK 100 million. No renumeration will be paid for the guarantee undertaking other than reimbursement for Levant Capital’s costs and expenses.
• The Rights Issue is covered to approximately 77 percent on beforehand through above subscription and guarantee commitments, representing an issue proceeds of at least SEK 166 million.
• The Board of Directors’ resolution on the Rights Issue is subject to approval by the EGM, to be held on August 3, 2022.
• Existing shareholders, representing 36.7 percent of the total shares and votes in the Company, have undertaken to, or indicated an intention to, vote in favor of the approval of the Rights Issue at the EGM.
• The subscription period will run from and including August 9, 2022 until and including August, 23, 2022.
• The record date for participation in the Rights Issue with preferential rights is August 5, 2022. Last day of trading in the Company’s shares including right to receive subscription rights in the Rights Issue is August 3, 2022 and the first day of trading in the Company’s shares without right to receive subscription rights in the Rights Issue is August 4, 2022.
• Trading in subscription rights will take place on the Nasdaq Stockholm during the period from and including August 9, 2022 until and including August 18, 2022.

Background and intention

IRRAS is a medical technology company that focuses on the delivery of innovative solutions for brain damage and intracranial haemorrhage. IRRAS designs, develops and commercializes products that improve the outcome for patients and reduce the total cost of care by addressing complications associated with current treatment methods in neurointensive care. IRRAS markets and sells its products globally to hospitals, through its own sales force in the US and in selected markets in Europe, as well as through a network of distributors in other markets. In the pursuit of these goals, IRRAS intends to become a dominant player in neurointensive care.

IRRAS' product portfolio includes the Company's original product IRRAflow and the product line Hummingbird ICP Monitoring. IRRAflow, which is a system for ventricular drainage and infusion, is FDA-approved and CE-marked for monitoring intracranial pressure as well as drainage of collected blood and excess cerebrospinal fluid. The Hummingbird product line includes eight FDA-approved products that help physicians diagnose and manage intracranial pressure in patients with traumatic brain injury, subarachnoid hemorrhage, and/or stroke. As IRRAflow is the only product on the market that has a flushing drainage, the combination of IRRAflow and Hummingbird creates a unique product portfolio and together with strong patent protection, IRRAS has, in the Company's assessment, good prospects of establishing itself as a leading player in the market.

As such, the Board has decided to carry out a Rights Issue to ensure a successful development in accordance with the Company's business plan and strategy. The purpose of the Rights Issue is to finance the Company's ongoing operations and its continued commercialization of its product portfolio.

Terms of the Rights Issue

Those who are registered shareholders in IRRAS on the record date, will receive one (1) subscription right for one (1) existing share. The subscription right grants the holder preferential right to subscribe for new shares, whereby one (1) subscription right entitles the shareholder to subscribe for nine (9) new shares. In addition, investors are offered the possibility to subscribe for shares without subscription rights.

In case not all shares have been subscribed for, the Board of Directors shall decide that allotment of shares subscribed for without subscription rights shall take place up to the maximum amount of the issue, whereby the board of directors primarily will allot shares to those who also subscribed for shares based on subscription rights, and in the event of over subscription, pro rata to their subscription based on subscription rights. Secondly, the board of directors will allot shares to those who subscribed for shares without subscription rights, and if full allotment cannot be made, pro rata to their subscription. To the extent not possible, allotment shall be made through drawing of lots, and finally, subject to such allocation being required in order for the issue to be fully subscribed, to the guarantors of the issue.

The subscription price is SEK 0.3 per new share. Assuming that the Rights Issue is fully subscribed, the share capital will be increased by a maximum of approximately SEK 21,459,961.80 from SEK 2,384,440.20 to SEK 23,844,402.00, by new issue of a maximum of 715,332,060 new shares, resulting in the total number of shares increasing from 79,481,340 shares to 794,813,400 shares. Assuming full subscription, IRRAS will receive total proceeds of approximately SEK 215 million, before deduction of transaction costs.

Shareholders who choose not to participate in the Rights Issue will, assuming that the Rights Issue is fully subscribed, have their shareholdings diluted by approximately 90 percent, but are able to financially compensate for this dilution by selling their subscription rights.

Undertakings and expected timeline of the Rights Issue

Bacara Holdings Ltd and Lexington Holding Assets Ltd have undertaken to subscribe for shares representing up to their pro-rata share of the Rights Issue (approximately 27.5 percent) conditional on that their combined ownership after the Rights Issue does not represent a shareholding of 30 percent or more. A Swedish institutional shareholder has undertaken to subscribe for shares representing up to their pro-rata share of the Rights Issue, provided that the Rights Issue is not subscribed for up to SEK 180 million through subscriptions with or without subscription rights or through allocation under the guarantee undertaking, and that their ownership after the Rights Issue does not surpass their current shareholding. Spetses Investments Limited, an investment vehicle managed by Levant Capital (in which Marios Fotiadis is a director of the board[2]), has undertaken to guarantee approximately 46.6 percent of the Rights Issue, corresponding to SEK 100 million. No commission will be paid for the guarantee undertaking other than reimbursement for Levant Capital’s costs and expenses.

The Board of Directors’ resolution on the Rights Issue is subject to approval by the EGM, to be held on August 3, 2022. Existing shareholders, representing approximately 36.7 percent of the total shares and votes in the Company, have undertaken, or indicated an intention to, vote in favor of the Rights Issue at the EGM.

In connection with the Rights Issue, the Company will undertake, subject to customary exceptions, not to issue additional shares for a period of 180 days after the outcome of the Rights Issue has been announced. During the same period, shareholding members of the Board of Directors and management of the Company will undertake, subject to customary exceptions, not to sell shares in the Company.

Preliminary timetable for the Rights Issue

August 3, 2022                                           Last day for trading including the right to receive subscription rights

August 4, 2022                                           First day of trading without the right to receive subscription rights

August 5, 2022                                           Publication of Prospectus

August 5, 2022                                           Record date for participation in the Rights Issue with preferential rights, that is, shareholders who are registered in the share register kept by Euroclear Sweden AB as of this day will receive subscription rights that entitle to participation in the Rights Issue with preferential rights

August 9, 2022 – August 18, 2022      Trading in subscription rights

August 9, 2022 – August 23, 2022      Subscription period

August 25, 2022                                         Announcement of the outcome of the Rights Issue

Advisors

Carnegie Investment Bank AB (publ) acts as Sole Global Coordinator and Joint Bookrunner in connection with the Rights Issue. Vator Securities acts as Joint Bookrunner in connection with the Rights Issue. Setterwalls Advokatbyrå AB acts as legal adviser to IRRAS in connection with the Rights Issue.

For more information, please contact:
USA
Will Martin
President and CEO
ir@irras.com

Europe
Sten Gustafsson
Director, Investor Relations
sten.gustafsson@irras.com
+46 102 11 5172

This document is considered information that IRRAS is obliged to disclose pursuant to the EU Market Abuse Regulation. The information was released for public disclosure, through the agency of the contact person above, on July 4, 2022, at 17:40 (CEST).

About IRRAS
IRRAS is a global medical care company focused on delivering innovative medical solutions to improve the lives of critically ill patients. IRRAS designs, develops, and commercializes neurocritical care products that transform patient outcomes and decrease the overall cost of care by addressing complications associated with current treatment methodologies. IRRAS markets and sells its comprehensive, innovative IRRAflow and Hummingbird ICP Monitoring product lines to hospitals worldwide through its direct sales organization in the United States and select European countries as well as an international network of distribution partners.

IRRAS maintains its headquarters in Stockholm, Sweden, with corporate offices in Munich, Germany, and San Diego, California, USA. For more information, please visit www.irras.com.

IRRAS is listed on Nasdaq Stockholm (ticker: IRRAS).

Important information
The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to restrictions. The recipients of this press release in jurisdictions where this press release has been published or distributed shall inform themselves of and follow such restrictions. The recipient of this press release is responsible for using this press release, and the information contained herein, in accordance with applicable rules in each jurisdiction. This press release does not constitute an offer, or a solicitation of any offer, to buy or subscribe for any securities in the Company in any jurisdiction where such offer would be considered illegal. This press release does not constitute an offer to sell or an offer to buy or subscribe for shares issued by the Company in any jurisdiction where such offer or invitation would be illegal. In a member state within the European Economic Area ("EEA"), shares referred to in the press release may only be offered in accordance with applicable exemptions under the Prospectus Regulation.

This press release does not constitute or form part of an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be sold in the United States absent registration or an exemption from registration under the US Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States. The information in this press release may not be announced, published, copied, reproduced or distributed, directly or indirectly, in whole or in part, within or into the United States, Canada, Japan, South Africa or Australia, or in any other jurisdiction where such announcement, publication or distribution of the information would not comply with applicable laws and regulations or where such actions are subject to legal restrictions or would require additional registration or other measures than what is required under Swedish law. Actions taken in violation of this instruction may constitute a crime against applicable securities laws and regulations.

In the United Kingdom, this document and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, "qualified investors" who are (i) persons having professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.

A prospectus regarding the Rights Issue described in this release will be published by the Company on or about August 5, 2022. This release is however not a prospectus in accordance to the definition in the Prospectus Regulation. In accordance with article 2 k of the Prospectus Regulation this press release constitutes an advertisement. Complete information regarding the Rights Issue can only be obtained through the Prospectus. IRRAS has not authorized any offer to the public of shares or rights in any other member state of the EEA. 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. This announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the new shares. Any investment decision in connection with the Rights Issue must be made on the basis of all publicly available information relating to the Company and the Company's shares. Such information has not been independently verified by the Joint Bookrunners. The Joint Bookrunners are acting for the Company in connection with the transaction and no one else and will not be responsible to anyone other than the Company for providing the protections afforded to its clients nor for giving advice in relation to the transaction or any other matter referred to herein.

Information to distributors

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the shares in IRRAS have been subject to a product approval process, which has determined that such shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, Distributors should note that: the price of the shares in IRRAS may decline and investors could lose all or part of their investment; the shares in IRRAS offer no guaranteed income and no capital protection; and an investment in the shares in IRRAS is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Rights Issue.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the shares in IRRAS.

Each distributor is responsible for undertaking its own target market assessment in respect of the shares in IRRAS and determining appropriate distribution channels.