Summary

• The board of directors of SyntheticMR has today, subject to an approval by an extraordinary general meeting, resolved to carry out a new share issue of approximately SEK 65 million with preferential rights for the Company's shareholders.
• The extraordinary general meeting is intended to be held on 17 December 2024. A notice for the extraordinary general meeting will be published through a separate press release.
• The rationale for carrying out the Rights Issue is to partly finance the acquisition of Combinostics, which was announced through a separate press release earlier today. The remaining part of the net proceeds from the Rights Issue will be used to finance the Company's R&D efforts and general corporate purposes.
• The record date for the right to participate in the Rights Issue is 19 December 2024.
• For each existing share held on the record date, one subscription right is received. Seven (7) subscription rights entitle to subscription of three (3) new shares, corresponding to a subscription ratio of 3:7.
• The subscription price in the Rights Issue is SEK 3.65 per share.
• The subscription period in the Rights Issue is expected to run during the period 23 December 2024 - 13 January 2025.
• In total, the Company has received and guarantee commitments amounting to approximately SEK 65 million, corresponding to 100 percent of the Rights Issue.

Background and reasons

SyntheticMR, founded in 2007, develops and markets innovative software solutions for Magnetic Resonance Imaging (MRI). SyntheticMR has developed SyMRI®, delivering multiple, adjustable contrast images and quantitative data from a single 5-minute scan. The SyMRI product is available in different packages. SyMRI NEURO delivers multiple contrast images, tissue segmentations and quantitative data on the brain. SyMRI MSK provides multiple contrast images and quantitative data for knee and spine anatomies. SyMRI NEURO is CE-marked, and FDA 510(k) cleared and SyMRI MSK is CE-marked. SyMRI 3D is 510(k)-pending and CE-marked.

In order to accelerate product development and thereby achieve a strengthened product offering for a broader range of healthcare provider profiles, as well as enhanced diagnostic precision, SyntheticMR has entered into an agreement, to acquire all shares in Combinostics. The purchase price[1] amounts to EUR 4.30 million (corresponding to approximately SEK 49.6 million), of which EUR 3.93 million (corresponding to approximately SEK 45.3 million) will be paid in cash and EUR 0.37 million (corresponding to approximately SEK 4.3 million) through the issue of convertible notes to class A shareholders in Combinostics. Upon full conversion of issued convertibles, the number of shares in the Company will increase by 356,907 shares and the share capital by SEK 7,923.3354, which entails a dilution of approximately 0.60 percent following the Rights Issue.

Combinostics offers cloud- and AI-based software solutions, referred to as cNeuro, designed to assist clinicians and radiologists with the early detection, diagnosis, and management of neurological diseases. These solutions provide clinical decision support and advanced image analysis to help healthcare professionals make informed, evidence-based decisions. The products are designed to integrate with existing systems, thereby increasing efficiency and improving workflows within healthcare facilities.

SyntheticMR envision several advantages and opportunities through the acquisition of Combinostics. Among other things, the Company assesses that the acquisition entails a significant acceleration of the Company's existing development plans. Since its founding in 2014, Combinostics has developed multiple solutions that are now CE-certified and FDA-approved, which can complement the Company's offering. SyntheticMR also has a well-established network of clinical and industrial partners. The Company also believes that there are opportunities to combine the two companies' respective technologies, which, according to the Company's assessment, would create a unique offering in the market. Furthermore, SyntheticMR believes that the Company's existing commercial structure can be utilized to expand Combinostics' current products into several major markets.

To finance the cash consideration for the acquisition and at the same time strengthen the capital structure post-acquisition, the board of directors has today, subject to an approval from an extraordinary general meeting, resolved to carry out a rights issue of shares amounting to approximately SEK 65 million with preferential rights for the Company's existing shareholders.

Use of proceeds

Through the Rights Issue, the Company will receive approximately SEK 65 million before deduction of transaction costs. The Company intends to primarily use the proceeds to finance the acquisition of Combinostics and for working capital to support R&D initiatives in accordance with the below breakdown.

• Approximately 86 percent of the net proceeds is intended to be used to partly finance the acquisition of Combinostics.[2]
• Approximately 14 percent of the net proceeds is intended to be used to finance R&D efforts and general corporate purposes.

Terms of the Rights Issue

For the reasons set out above, the Company's board of directors, subject to an approval from an extraordinary general meeting, has decided to carry out the Rights Issue of approximately SEK 65 million before transaction costs. Those who are registered as shareholders in SyntheticMR on the record date 19 December 2024 have preferential rights to subscribe for new shares in SyntheticMR in relation to their current shareholding in the Company. Shareholders receive one (1) subscription right for each share held in the Company. The subscription rights entitle the holder to subscribe for new shares in the Rights Issue, whereby seven (7) subscription rights give the shareholder the right to subscribe for three (3) new shares. In addition, investors are offered the possibility to apply for subscription of shares without subscription rights.

The subscription price in the Rights Issue has been set to SEK 3.65 per share. Through the Rights Issue, the number of shares will increase by 17,866,405  shares, from 41,688,280 shares to 59,554,685 shares. The share capital will increase by SEK 396.634.191, from SEK 925,479.816 to SEK 1,322,114.007. Shareholders who choose not to participate in the Rights Issue will through the Rights Issue have their ownership share diluted by up to 17,866,405 shares, corresponding to approximately 30 percent.

Subscription for new shares shall be made during the period 23 December 2024 - 13 January 2025. Trading in subscription rights is expected to take place on Spotlight Stock Market during the period from 23 December 2024 to 8 January 2025 and trading in BTA (paid subscribed shares) is expected to occur between 23 December 2024 and 22 January 2025.

No prospectus will be prepared in connection with the Rights Issue. The Company will prepare and publish a disclosure document in the form prescribed by Regulation (EU) 2024/2809 ("Listing Act") Annex IX.

Extraordinary general meeting

The board of directors' resolution regarding the Rights Issue is subject to approval by an extraordinary general meeting, which is scheduled to be held on 17 December 2024. A notice for the extraordinary general meeting will be published through a separate press release.

Subscription undertakings, guarantee commitments and voting commitments

Provided that the extraordinary general meeting approves the board of directors' resolution on the Rights Issue, certain existing shareholders, including Staffan Persson, through Swedia Invest AB, and Aktia Nordic Micro Cap Fund, have undertaken to subscribe for their respective pro rata share of the Rights Issue, corresponding to a total of approximately 34 percent, or approximately SEK 22.4 million of the Rights Issue. These shareholders have also undertaken to vote in favor of the Rights Issue at the extraordinary general meeting.

Several members of the Company's board of directors and management, Johanna Norén, Johanna Fälting and Gisli Hennermark, as well as multiple external investors, Thomas Eklund, Åsa Riisberg, Wilhelm Risberg, Fredrik Lundgren, Buntel AB, Capmate AB, Carl Rosvall, Exelity AB, Fenja Capital I A/S, Gryningskust Holding AB, Mastan AB and Råsunda Förvaltning AB, have on customary terms and at a guarantee commission of 8 percent of the guaranteed amount in cash, entered into guarantee commitments for, in total, approximately 66 percent of the Rights Issue, corresponding to approximately SEK 43.8 million.[3] Neither the subscription undertakings nor the guarantee commitments are secured by bank guarantee, blocked funds, pledges or similar arrangements.

The Rights Issue is thus covered by subscription commitments and guarantee commitments of approximately SEK 65 million, corresponding to 100 percent of the Rights Issue.

Lock-up undertakings

Prior to the execution of the Rights Issue, the board of directors and management of SyntheticMR have towards Skandinaviska Enskilda Banken AB ("SEB") undertaken, subject to certain customary exceptions, not to sell any shares in the Company for a period of 90 days from the day after the outcome of the Rights Issue has been announced, a so-called lock-up undertaking.

Furthermore, the Company has undertaken towards SEB, subject to customary exceptions and except for the issue of convertibles to the sellers of Combinostics as part of the purchase price, not to issue additional shares or other share-related instruments for a period of 180 days from the day after the outcome of the Rights Issue has been announced.

Indicative timetable for the Rights Issue

The below timetable for the Rights Issue is preliminary and may be adjusted.

Advisors

Skandinaviska Enskilda Banken AB ("SEB") acts as Sole Global Coordinator and Bookrunner and Baker & McKenzie Advokatbyrå KB acts as legal advisor to the Company in connection with the Rights Issue.

For more information, please contact:

Ulrik Harrysson, CEO               
Phone: + 46 70 529 29 87          
E-mail: ulrik.harrysson@syntheticmr.com

Johanna Norén, CFO and Head of Investor Relations               
Phone: + 46 70 619 21 00          
E-mail: johanna.noren@syntheticmr.com

This information is information that SyntheticMR is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014. The information was submitted for publication, through the agency of the contact persons set out above, at 28 November 2024 kl. 23:05 CET. 

About SyntheticMR

SyntheticMR develops and markets innovative software solutions for Magnetic Resonance Imaging (MRI). SyntheticMR has developed SyMRI®, delivering multiple, adjustable contrast images and quantitative data from a single 5-minute scan. The SyMRI product is available in different packages. SyMRI NEURO delivers multiple contrast images, tissue segmentations and quantitative data on the brain. SyMRI MSK provides multiple contrast images and quantitative data for knee and spine anatomies. SyMRI NEURO is CE-marked, and FDA 510(k) cleared and SyMRI MSK is CE-marked. SyMRI 3D is 510(k)-pending and CE-marked. SyMRI is a registered trademark in Europe and the USA. SyntheticMR is listed on the Spotlight Stock Market Exchange in Stockholm, Sweden. For more information, visit www.syntheticmr.com.

IMPORTANT INFORMATION

The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to legal 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 legal 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 SyntheticMR in any jurisdiction, neither from SyntheticMR nor from someone else.

This press release is not a prospectus for the purposes of Regulation (EU) 2017/1129 (the "Prospectus Regulation") and has not been approved by any regulatory authority in any jurisdiction. No prospectus will be prepared in connection with the Rights Issue. The Company will prepare and publish a disclosure document in the form prescribed by Regulation (EU) 2024/2809 ("Listing Act") Annex IX.

This press release 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 Company. The information contained in this announcement relating to the Rights Issue is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this press release or its accuracy or completeness. SEB are acting for SyntheticMR in connection with the Rights Issue and no one else and will not be responsible to anyone other than SyntheticMR for providing the protections afforded to its clients nor for giving advice in relation to the Rights Issue or any other matter referred to herein. SEB are not liable to anyone else for providing the protection provided to their customers or for providing advice in connection with the Rights Issue or anything else mentioned herein.

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 Rights Issue 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 USA, Australia, Canada, Hong Kong, Japan, New Zeeland, Singapore, South Africa, South Korea, Switzerland 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.

Please note that an investment in the Company is subject to regulation under the Foreign Direct Investment Act (2023:560), which requires investors, under certain conditions, to notify and obtain approval from the Swedish Inspectorate for Strategic Products. Investors should make their own assessment of whether a notification obligation exists before making any investment decision regarding the Rights Issue.

Forward-looking statements

This press release contains forward-looking statements that reflect the Company's intentions, beliefs, or current expectations about and targets for the Company's and the group's future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies and opportunities and the markets in which the Company and the group operates. Forward-looking statements are statements that are not historical facts and may be identified by words such as "believe", "expect", "anticipate", "intend", "may", "plan", "estimate", "will", "should", "could", "aim" or "might", or, in each case, their negative, or similar expressions. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurances that they will materialize or prove to be correct. Because these statements are based on assumptions or estimates and are subject to risks and uncertainties, the actual results or outcome could differ materially from those set out in the forward-looking statements as a result of many factors. 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 Company does not guarantee that the assumptions underlying the forward-looking statements in this press release are free from errors and readers of this press release should not place undue reliance on the forward-looking statements in this press release. The information, opinions and forward-looking statements that are expressly or implicitly contained herein speak only as of its date and are subject to change without notice. Neither the Company nor anyone else undertake to review, update, confirm or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this press release.

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 offered shares 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 the Company may decline and investors could lose all or part of their investment; the shares in the Company offer no guaranteed income and no capital protection; and an investment in the shares in the Company 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 the Company.

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