Pharma Equity Group's Recent Convertible Loan Issuance
The Board of Directors of Pharma Equity Group has made a significant decision to issue convertible loans, aiming to strengthen the company’s financial position and support its future growth plans. This action is aligned with the authorization outlined in the company's Articles of Association, particularly under item 4.3.A. This new funding will allow Pharma Equity Group to raise up to DKK 8,798,336, while simultaneously repaying previous convertible loans and a utilized credit facility.
Main Features of the New Convertible Loans
The convertible loans to be issued have several important terms and conditions, which include:
Conversion Rights
Lenders will have the right to convert these loans into company shares within a specific timeframe. This conversion right can be exercised for 30 days starting from the first day of the 24th month after the conclusion of the loans. This exercise period grants investors a significant opportunity to become shareholders.
Interest and Repayment Terms
The loans will accrue interest at an annual rate of 10%, and there will be no repayments required until the end of the exercise period. After this period, Pharma Equity Group must redeem the bonds, including the interest, within 60 days. Notably, the company has the option to extend the loan period by an additional 12 months if needed.
Conversion Price
The conversion will occur at a price of DKK 0.12 per share, allowing investors to transform their loans into equity in the company. If the conversion right is not exercised, any remaining loan amount plus accrued interest will be repaid in shares at the calculated conversion price.
Impact on Share Capital
Upon successful conversion of the loans into new shares, these shares will be issued without pre-emptive rights for existing shareholders, ensuring that all new shares enjoy the same rights as current ones. The newly issued shares will be made available for trading on Nasdaq Copenhagen, marking a step forward for the company.
Furthermore, the maximum potential increase in share capital from the conversion of the loans is approximately DKK 9,652,056. Such strategic moves contribute to the overall expansion and longevity of the Pharma Equity Group.
Repayment of Existing Loans
Alongside the issuance of new convertible loans, Pharma Equity Group will also be repaying existing debts. Among these are convertible loans of nominal DKK 600,000 from April 2025, DKK 1,000,000 from February 2024, and DKK 1,000,000 dated September 2023, as well as a utilized credit facility totaling DKK 4,347,500. This focused approach on debt management will establish a solid foundation for future investments.
Conditions of Existing Loans
The existing DKK 600,000 loan being repaid is a subordinated loan, meaning it ranks behind other creditors unless those are also subordinated loans. The conversion rights and conditions related to this loan mirror those offered in the new convertible loans.
Future Development and Growth Strategy
Pharma Equity Group, as a dedicated subsidiary, emphasizes the advancement of its drug candidates through Reponex Pharmaceuticals. It remains committed to providing substantial support and resources to enhance the success of these endeavors in the healthcare sector. The overarching strategy is to maximize the potential of the current projects before considering any new investment opportunities.
Contact Information for Inquiries
For more information about the convertible loans or other company matters, interested parties can reach out to the following contacts:
Christian Tange, CEO of Pharma Equity Group A/S, phone: +45 2948 8417
Christian Vinding Thomsen, Chairman of the Board of Directors of Pharma Equity Group A/S, phone: +45 2622 7222
Frequently Asked Questions
What are convertible loans?
Convertible loans are a type of financing where the lender has the right to convert the loan amount into equity shares in the borrowing company under certain conditions.
What is the interest rate on these loans?
The new convertible loans issued by Pharma Equity Group bear an interest rate of 10% per annum.
What happens if the conversion rights are not exercised?
If the conversion rights are not exercised, the loan along with accrued interest will be repaid in shares at the conversion price.
What is the purpose of these convertible loans?
The purpose of the convertible loans is to raise funds to manage existing debt and help finance the company's growth and development plans.
Will new shares affect existing shareholders?
The new shares issued will not have pre-emptive rights for existing shareholders, meaning existing shareholders will not have the opportunity to purchase additional shares to maintain their ownership percentage.
