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SpineGuard: secures 2.4 M equity funding over 12 months with Nice & Green

Regulatory News:

SpineGuard (Paris: ALSGD) (FR0011464452 – ALSGD, PEA-PME eligible), an innovative company that designs, develops and markets medical devices intended to secure and simplify the placement of bone implants, announces today the installation of ” financing by issuing 120 redeemable share subscription warrants (BSAR) divided into 12 equal monthly tranches for a total amount of € 2.4 million.

This flexible funding is intended to secure the financial situation of SpineGuard on the one hand in the context of the COVID-19 pandemic and on the other hand within the framework of safeguard plans in France and in the United States (Chapter 11), in particular the restructuring of the Company’s bond debt.

Pierre Jérôme Chairman and Chief Executive Officer and co-founder of SpineGuard, says: “ While we were staying on course with our objective of operational profitability at the start of the year, the COVID-19 pandemic has had a strong impact on our sales since mid-March. Although surgical activity is now in a clear recovery phase and we are about to launch our new DSG-Connect interface, it seemed important to us to secure our cash horizon beyond 12 months. We are very satisfied with this financing operation because it gives us great flexibility of use and is useful for the construction of the safeguard plan in France and the United States (Chapter 11), in particular to restructure our debt under good conditions . I would like to thank Nice & Green for their renewed confidence. ”

Main terms of the operation

This financing is provided by Nice & Green, a company specializing in the supply of financing solutions adapted to listed companies and which has supported SpineGuard since 2017.

The Chairman and Chief Executive Officer, using the sub-delegation of competence which was granted to him by the Board of Directors of SpineGuard at its meeting of May 14, 2020, decided on June 26, 2020, to issue 120 BSARs to be subscribed by Nice & Green on fixed dates according to the predefined calendar below.

  • the BSARs subscribed by Nice & Green will not be listed;

  • the BSAR exercises and the transfer of the shares resulting from the exercise will take place on the run of water by decision of Nice & Green without a pre-established schedule;

  • the number of shares to be issued on the exercise of the Nice & Green BSARs will be determined on the basis of the lowest of the average prices weighted by the volumes of the ten trading sessions preceding the exercise of the BSARs with a discount of 8%.

The company Nice & Green undertakes to subscribe these 120 BSARs according to the predefined schedule below for a total amount (subscription price and exercise price) of € 2.4 million (i.e. 12 tranches of 10 BSAR of a unit value of € 20,000 (divided between the subscription price and the exercise price) corresponding to the subscription of all the BSARs by Nice & Green.

This issue will not give rise to the preparation of a prospectus subject to the approval of the AMF.

CHARACTERISTICS AND TERMS OF THE FINANCING PLAN BY ISSUING REDEEMABLE SHARES (BSAR)

Legal framework of the operation

Making use of the delegation of the Board of Directors of May 14, 2020 acting on the basis of the eleventh and twelfth resolutions of the ordinary and extraordinary general meeting of shareholders of SpineGuard of May 14, 2020, the Chairman and Chief Executive Officer decided today issue 12 tranches of 10 BSARs (for a total of 120 BSARs) over a period of 12 months, with a nominal unit value of € 20,000 to be subscribed by Nice & Green according to the pre-established subscription calendar.

Main characteristics of BSARs

The BSARs will be in registered form and numbered from one to one hundred and twenty according to the subscription dates indicated in the calendar below. These may be postponed by mutual agreement or in the event of the exercise of the option to suspend on the initiative of the Company in accordance with the terms of the issue contract which would have the effect of shifting the subscription dates:

Dates

BSAR

01-Jul-20

1 to 10

31-Jul-20

11 to 20

31-Aug-20

21 to 30

29-Sep-20

31 to 40

28-Oct-20

41 to 50

27-Nov-20

51 to 60

30-Dec-20

61 to 70

01-Feb-21

71 to 80

02-March-21

81 to 90

31-March-21

91 to 100

03-May-21

101 to 110

03-Jun-21

111 to 120

The BSARs can be freely transferred by Nice & Green to one or more of its affiliates and cannot be transferred to any other third party without the prior written authorization of SpineGuard.

SpineGuard has a unilateral right of revocation allowing it to reimburse in its sole discretion and at any time the outstanding BSARs. The contract also contains the usual default or termination clauses, in particular in the event of a change of control.

The shares resulting from the exercise of BSARs will be issued in bearer form.

Subscription and exercise of BSAR

The unit subscription price for each BSAR is eighteen thousand euros and must be paid by Nice & Green to SpineGuard on the subscription date (the “Subscription Price”).

Unless a suspension request is made in accordance with the terms of the issue contract, each BSAR must be exercised within forty-five Trading Days from its date of subscription (the “Exercise Period”).

The unit exercise price of each BSAR is two thousand euros and must be paid by Nice & Green to SpineGuard on each exercise date (the “Exercise Price”).

Share issues

The unit issue price of the new shares resulting from the exercise of the BSARs (the “Issue Price”) will be equal to ninety-two percent of the lowest average price weighted by the reference volumes out of the 10 last sessions before exercise.

The number of Shares issued on exercise of each BSAR will be determined according to the following formula:

N = (PS + PEx) / PE

Or

N: designates the number of shares to be issued

PS: designates the Subscription Price

PEx: designates the Exercise Price

PE: means the Issue Price

Example of calculation of the number of shares to be issued on the exercise of ten BSAR:

Average price weighted by reference volumes: € 0.30 issue price = € 0.30 x 0.92 = € 0.2760

Number of shares to be issued: (180,000 + 20,000) / 0.2760 € = 724,638 shares

The new shares will be admitted to trading on Euronext Growth from their issue, will carry current rights and will be fully assimilated to existing shares and fungible with them.

The Company will keep up to date on its website a table monitoring the BSARs and the number of shares issued on exercise of the BSARs.

The policy of Nice & Green is not to integrate the governance of the companies in which it invests and therefore does not intend to seek representatives from the governance of the Company.

Nice & Green is not a financial intermediary and finances this operation with its own funds. There is therefore no constraint on the rapid sale of the shares subscribed for upon exercise of the BSARs, but neither is it intended to keep its securities over the long term.

Theoretical impact of the BSAR issue

As an indication, the impact of the issue and subscription of BSAR 1 to 120 for a total nominal amount of € 2.4 million would be as follows:

Impact of the issue on the participation in the share capital

The impact of the issue of 8,695,652 new ordinary shares (theoretical number of shares given as an indication in the event that the BSARs are all exercised at an exercise price of € 0.2760 on the participation in the shareholder capital holding 1% of the Company’s capital prior to the issue (calculations made on the basis of 17,707,245 shares making up the capital as of May 31, 2020 and 20,377,786 shares on a fully diluted basis), would be the next :

Shareholder participation (in%)

Based

undiluted

Based

diluted

Number

of actions

Before issuance of BSAs from this transaction

1.00%

0.87%

17,707,245

After issuance of 120 BSA from this transaction

0.67%

0.61%

26,402,897

Impact of the issue on the share of equity

The impact of the issuance of 8,695,652 new ordinary shares on the share of shareholder equity as of December 31, 2020 which amounts to € 592,031 (calculations made on the basis of 17,707,245 shares making up the capital at May 31, 2020 and 20,377,786 shares on a fully diluted basis), would be as follows:

Share of equity per share

(in euros)

Based

undiluted

Based

diluted

Number

of actions

Before issuance of BSAs from

of this operation

(€ 0.03)

(€ 0.03)

17,707,245

After issuance of 120 BSAs from

of this operation

(€ 0.02)

(€ 0.02)

26,402,897

About SpineGuard®

Founded in 2009 by Pierre Jérôme and Stéphane Bette, based in Paris and Boulder in the United States, SpineGuard is an innovative company which deploys its digital DSG® technology for real-time surgical guidance without X-rays to secure and simplify the placement of bone implants. The company designs, develops and markets worldwide innovative medical devices used in more than 75,000 surgeries to date. Numerous scientific studies, including 15 published in leading medical journals, have established the reliability and precision of DSG® technology and its numerous advantages for patients, surgeons, hospital staff and health systems. Building on these fundamentals and strategic partnerships, SpineGuard is extending the applications of its DSG® technology to innovations such as the “smart” pedicle screw, surgical robotics and dental implantology. DSG® was invented by Maurice Bourlion, Dr Ciaran Bolger and Alain Vanquaethem, the company has been labeled “innovative company” by Bpifrance since 2009.

More information on www.spineguard.fr