Observe Medical ASA - Terms of the underwritten rights issue

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Reference is made to Observe Medical ASA's (the "Company") stock exchange announcement published on 26 May 2020, regarding a proposed fully underwritten rights issue (the "Rights Issue") which is subject to the approval by the extraordinary general meeting of the Company to be held at 14:00 (CET) tomorrow (16 June 2020).

The Company's board of directors has today, based on a recommendation from SpareBank1 Markets AS (acting as "Manager" in the Rights Issue), determined the following (i) subscription price, (ii) the number of new shares and (iii) the share capital increase pertaining to the Rights Issue:

  • The subscription price is proposed to be NOK 11.00 per new share offered in the Rights Issue (the "Offer Shares"), representing a discount of approximately 32.6% to the theoretical share price exclusive of the subscription rights (TERP) based on the Company's closing share price on Oslo Axess of NOK 17.75 on 15 June 2020;
  • The share capital of the Company is proposed to be increased by NOK 1,063,636.34 through the issue of 4,090,909 Offer Shares, representing a ratio of one (1) Offer Share per 0.266636 existing share; and
  • The Company will raise NOK 45 million in gross proceeds in the Rights Issue.

Each existing shareholder as of 16 June 2020 (and being registered as such in the Norwegian Central Securities Depository (the "VPS") as at the expiry of 18 June 2020 (the record date)) will be granted one subscription right for every 0.266636 share 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 Offer Share in the Rights Issue.

The proposal to increase the share capital of the Company as set out in the notice to the extraordinary general meeting of the Company will be adjusted to reflect the (i) subscription price, (ii) the number of new shares and (iii) the share capital increase pertaining to the Rights Issue as set out above. For further information regarding the Rights Issue, see the notice of the extraordinary general meeting available on www.observemedical.com.

The full terms and conditions of the Rights Issue will be included in a prospectus, comprising a registration document, a securities note and a summary (jointly, the "Prospectus"), which will be published prior to the commencement of the subscription period in the Rights Issue, which is expected to take place from 19 June 2020 to 3 July 2020 at 16:30 CET.

SpareBank1 Markets AS is acting as manager for the Right Issue. Advokatfirmaet Thommessen AS is acting as legal counsel to the Company.

For further information, please contact:

Björn Larsson, CEO, Observe Medical ASA
Tel.: + 46 76 620 17 25
E-mail: bjorn.larsson@observemedical.com

Per Arne Nygård, CFO, Observe Medical ASA
Tel.: +47 411 04 345
E-mail: perarne.nygard@observemedical.com

About Observe Medical

Observe Medical develops and markets innovative hospital products that contribute to increased patient safety and a more efficient care system. The company's headquarter is in Oslo and its operations are based out of Sweden. Observe Medical's initial product was Sippi®, the only automated digital urine meter with wireless data transfer to the hospital patient data management systems, and also prevents bacterial migration that can lead to urinary infections (Sippcoat®). Sippi® is CE marked and is currently being launched at selected hospitals in Europe.


These materials do 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. Any sale in the United States of the securities mentioned in this communication will be made solely to existing shareholders of the Company as of 16 June 2020 (and being registered as such in the Norwegian Central Securities Depository (the "VPS") as at the expiry of 18 June 2020 pursuant to the two days' settlement procedure of VPS) who are "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.

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 (together with any applicable implementing measures in any 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.

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 Manager is 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 Manager nor any of its 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 Manager nor any of its respective affiliates accepts any liability arising from the use of this announcement.

The offering of the securities referred to in this announcement will be made by means of the Prospectus. 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 Member State. 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 website of the Company (www.observemedical.com) and SpareBank 1 Markets (https://www.sb1markets.no/).

Each of the Company, the Manager 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 subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.