SANTA
CLARA, Calif., Jan. 24,
2025 /PRNewswire/ -- Semler Scientific, Inc.
(Nasdaq: SMLR) today announced the pricing of its offering of
$85.0 million aggregate principal
amount of 4.25% convertible senior notes due 2030 (the "notes") in
a private offering (the "offering") to persons reasonably believed
to be qualified institutional buyers pursuant to Rule 144A under
the Securities Act of 1933, as amended (the "Securities Act"). The
offering size was increased from the previously announced offering
size of $75.0 million aggregate
principal amount of notes. Semler Scientific also granted the
initial purchasers of the notes an option to purchase, during a
13-day period beginning on, and including, the first date on which
the notes are issued, up to an additional $15.0 million principal amount of notes. The sale
of the notes is expected to close on January
28, 2025, subject to satisfaction of customary closing
conditions.
Key Elements of the Transaction
- Upsized $85.0 million 4.25%
convertible senior notes offering (25% conversion premium)
- Capped call transactions entered into in connection with the
offering with an initial cap price of approximately $107.01 per share of Semler Scientific's common
stock, which represents a premium of approximately 75% over the
last reported sale price of the common stock on January 23, 2025
Additional Details of the Convertible Notes
The notes will be senior unsecured obligations of Semler
Scientific and will accrue interest payable semiannually in arrears
on February 1 and August 1 of each year, beginning on August 1, 2025, at a rate of 4.25% per year. The
notes will mature on August 1, 2030,
unless earlier converted, redeemed or repurchased. The initial
conversion rate of the notes will be 13.0826 shares of Semler
Scientific's common stock per $1,000
principal amount of such notes (equivalent to an initial conversion
price of approximately $76.44 per
share). The initial conversion price of the notes represents a
premium of approximately 25% over the last reported sale price of
Semler Scientific's common stock on the Nasdaq Capital Market on
January 23, 2025. Upon conversion,
Semler Scientific will pay or deliver, as the case may be,
cash, shares of its common stock or a combination of cash and
shares of its common stock, at its election.
Semler Scientific may not redeem the notes prior to August 4, 2028. Semler Scientific may redeem for
cash all or any portion of the notes (subject to certain
limitations), at its option, on or after August 4, 2028 and prior to the 21st
scheduled trading day immediately preceding the maturity date, if
the last reported sale price of Semler Scientific's common stock
has been at least 130% of the conversion price then in effect for
at least 20 trading days (whether or not consecutive) during any 30
consecutive trading day period (including the last trading day of
such period) ending on, and including, the trading day immediately
preceding the date on which Semler Scientific provides notice of
redemption at a redemption price equal to 100% of the principal
amount of the notes to be redeemed, plus accrued and unpaid
interest to, but excluding, the redemption date.
If Semler Scientific undergoes a "fundamental change" (as
defined in the indenture that will govern the notes), then, subject
to certain conditions and limited exceptions, holders may require
Semler Scientific to repurchase for cash all or any portion of
their notes at a repurchase price equal to 100% of the principal
amount of the notes to be repurchased, plus accrued and unpaid
interest to, but excluding, the fundamental change repurchase date.
In addition, upon certain corporate events that occur prior to the
maturity date of the notes or if Semler Scientific delivers a
notice of redemption in respect of some or all of the notes, it
will, under certain circumstances, increase the conversion rate of
the notes for holders who elect to convert their notes in
connection with such a corporate event or convert their notes
called (or deemed called) for redemption during the related
redemption period, as the case may be.
Use of Proceeds
Semler Scientific estimates that the net proceeds from the
offering will be approximately $81.4
million (or approximately $95.8
million if the initial purchasers exercise their option to
purchase additional notes in full), after deducting the initial
purchasers' discount and estimated offering expenses payable by
Semler Scientific. Semler Scientific intends to use approximately
$6.6 million of the net proceeds from
the offering to pay the cost of the capped call transactions that
it entered into as described below and the remainder of the net
proceeds for general corporate purposes, including the acquisition
of bitcoin.
Capped Call Transactions
In connection with the pricing of the notes, Semler Scientific
entered into privately negotiated capped call transactions (the
"capped call transactions") with certain financial institutions
(the "option counterparties"). The capped call transactions cover,
subject to customary adjustments, the number of shares of Semler
Scientific's common stock that will initially underlie the notes.
The capped call transactions are expected to offset the potential
dilution to Semler Scientific's common stock as a result of any
conversion of notes, with such reduction subject to a cap. The cap
price of the capped call transactions relating to the notes will
initially be approximately $107.01,
which represents a premium of approximately 75% over the last
reported sale price of Semler Scientific's common stock on the
Nadaq Capital Market on January 23,
2025, and is subject to certain adjustments under the terms
of the capped call transactions. If the initial purchasers exercise
their option to purchase additional notes, Semler Scientific
expects to enter into additional capped call transactions with the
option counterparties.
In connection with establishing their initial hedges of the
capped call transactions, Semler Scientific expects that the option
counterparties and/or their respective affiliates may enter into
various derivative transactions with respect to its common stock
and/or purchase its common stock in secondary market transactions
concurrently with or shortly after the pricing of the notes,
including with certain investors in the notes. This activity could
increase (or reduce the size of any decrease in) the market price
of Semler Scientific's common stock or the notes at that time.
In addition, Semler Scientific expects that the option
counterparties and/or their respective affiliates may modify or
unwind their hedge positions by entering into or unwinding various
derivative transactions and/or purchasing or selling Semler
Scientific's common stock or other securities of Semler Scientific
in secondary market transactions following the pricing of the notes
and prior to the maturity of the notes (and are likely to do so on
each exercise date of the capped call transactions, which are
scheduled to occur during the observation period relating to any
conversion of the notes on or after May 1,
2030 that is not in connection with a redemption, or
following Semler Scientific's election to terminate any portion of
the capped call transactions in connection with any repurchase,
redemption, exchange or early conversion of the notes). This
activity could also cause or avoid an increase or a decrease in the
market price of Semler Scientific's common stock or the notes,
which could affect a noteholder's ability to convert its notes and,
to the extent the activity occurs during any observation period
related to a conversion of notes, it could affect the amount and
value of the consideration that a noteholder will receive upon
conversion of its notes.
Neither the notes, nor any shares of Semler Scientific's common
stock issuable upon conversion of the notes, have been registered
under the Securities Act or any state securities laws, and unless
so registered, may not be offered or sold in the United States or to, or for the account or
benefit of, U.S. persons, absent registration or an applicable
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and other
applicable securities laws.
This press release is neither an offer to sell nor a
solicitation of an offer to buy any securities, nor shall it
constitute an offer, solicitation or sale of any securities in any
state or jurisdiction in which such offer, solicitation or sale
would be unlawful prior to the registration or qualification under
the securities laws of any such state or jurisdiction.
About Semler Scientific
Semler Scientific, Inc. is a pioneer in developing and marketing
technology products and services to healthcare providers to combat
chronic diseases. Its flagship product, QuantaFlo®, which is
patented and cleared by the U.S. Food and Drug Administration
(FDA), is a rapid point-of-care test that measures arterial blood
flow in the extremities. The QuantaFlo test aids in the diagnosis
of cardiovascular diseases, such as peripheral arterial disease
(PAD), and Semler Scientific is seeking a new 510(k) clearance for
expanded indications. QuantaFlo is used by healthcare providers to
evaluate their patient's risk of mortality and major adverse
cardiovascular events (MACE). Semler Scientific also invests in
Bitcoin and has adopted Bitcoin as its primary
treasury asset.
Forward-Looking Statements
This press release contains "forward-looking" statements. Such
statements can be identified by, among other things, the use of
forward-looking language such as the words "believe," "goal,"
"may," "will," "intend," "expect," "anticipate," "estimate,"
"project," "would," "could" or words with similar meaning or the
negatives of these terms or by the discussion of strategy or
intentions. The forward-looking statements in this release include
express or implied statements about the closing of the offering of
the notes and capped call transactions, the potential impact of the
foregoing or related transactions on dilution to holders of our
common stock, the market price of our common stock or the notes,
and the anticipated use of proceeds from the offering. Such
forward-looking statements are subject to a number of risks and
uncertainties that could cause Semler Scientific's actual results
to differ materially from those discussed here, including but not
limited to whether we will consummate the offering of notes on the
expected terms or at all, which could differ or change based upon
market conditions or for other reasons, and the other risk factors
detailed in Semler Scientific's filings with the Securities and
Exchange Commission. These forward-looking statements involve
assumptions, estimates, and uncertainties that reflect current
internal projections, expectations or beliefs. There can be no
assurance that such statements will prove to be accurate, and
actual results and future events could differ materially from those
anticipated in such statements. All forward-looking statements
contained in this press release are qualified in their entirety by
these cautionary statements and the risk factors described above.
Furthermore, all such statements are made as of the date of this
press release and Semler Scientific assumes no obligation to update
or revise these statements unless otherwise required by law.
Investor Relations Contact:
Renae Cormier
Chief Financial Officer
ir@semlerscientific.com
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SOURCE Semler Scientific, Inc.
