Q&A – Partnerships in Nigeria and Ghana

On December 30, 2020, Brighter announced two five-year distribution agreements with companies in Nigeria and Ghana regarding the Actiste® product portfolio. Below follows a Q&A regarding the partnerships. If you have any additional questions, please contact ir@brighter.se.

Summary
Brighter has signed two 5-year distribution agreements with companies in Nigeria and Ghana. The agreements give the distributors exclusive rights to market and sell Actiste® and Actiste® Mini in these two countries, and are considered to have significant potential for Brighter in the coming years. For additional information about the agreements, please see the official press releases here: Nigeria | Ghana

On January 5, Brighter also published a Clarification regarding the payment process here.

Who are the partners?

Nigeria – WSSOnlines Nigeria
WSSOnlines is a recently activated company in Nigeria, managed by Dr. C’Fine Okorochukw – an endocrinologist and a key opinion leader in the endocrinology community in Nigeria – and Ikoro Ogbonna Junior, a successful entrepreneur in Sweden with an extensive Nigerian business network, in order to introduce and distribute Actiste® in the Nigerian market. C’Fine Okorochukwu is also known for his role as Founder and Executive Director at Center For Public Health which is a non-governmental organisation with special consultative status to ECOSOC (United Nations). He is also an experienced entrepreneur within distribution of medtech products.

Ghana – Fretac Plus Ventures
Fretac Plus Ventures was established by CEO Frederick Akuffo-Gyimah, a successful Swedish-Ghanaian entrepreneur with an extensive regional business network and wide experience from various businesses and operations. The company is partnering with leading regional endocrinologists in Ghana to introduce and distribute Actiste® in the Ghanaian market.

What is the long-term potential?
The parties have agreed on increasing minimum order volumes each year.

The minimum order volume in Nigeria year one is 8,000 subscriptions. The minimum order volume in year five is 210,000 subscriptions.

The minimum order volume in Ghana year one is 4,000 subscriptions. The minimum order volume in year five is 44,000 subscriptions.

What is the status on market approvals?
The estimated market approval process in Nigeria is 9 months. The estimated market approval process in Ghana is 6 months. These processes will begin shortly in collaboration with regulatory partners and the Distributors.

When will the first deliveries take place?
The fulfillment of the orders is pending the local regulatory approvals. Brighter will fund a User Experience program with one hundred Actiste subscriptions. The distributor will ensure the local authorities’ approval to grant an exception to run the program during the registration period.

What happens next?
Brighter and its new partners will start the collaboration immediately and Brighter will support to get all the necessary processes going. Developments will be communicated continuously.

Q&A – Directed share issue September 15, 2020

On September 15 2020, Brighter announced a share issue of SEK 21 million directed to Unwrap Finance Nordic AB. Read the full press release here. Below is a Q&A based on received questions. Should you have any additional questions not answered in this Q&A, please contact ir@brighter.se. 

Details in short:
Subscription price: SEK ~2.84
Share price at the day of the announcement: SEK ~2.91
Discount: ~2.3% compared with the day of announcement, 10% compared with the vwap of the share during the period August 3 to September 11.

Is this the way transactions are going to be done to cover routine operation?
Yes, this transaction represents the primary option that Brighter currently has decided on to finance its routine operations. We have other types of transactions available to us as well, similar to this one, and we are continuously evaluating what type of transaction that is most efficient for the company as well as its shareholders at any given time. 

Further to that the Board and Leadership team are working on and evaluating additional financing options to secure the funds and resources needed to pursue the ambitious expansion strategy. E.g. Directed share issues to institutions, family offices and other professional investors, and financial agreements/prepayments from large customers/distributors.

Is Unwrap Finance Nordic to be regarded as a long-term investor?
Unwrap Finance Nordic is a financial investor with whom Brighter has a long and solid relationship, but is not to be regarded as an institutional investor in that sense.

Why did you not have a lock-in clause for this transaction?
A lock-in clause is not standard when it comes to directed issues. The discount in this transaction is standard. Addition of nonstandard clauses for such a transaction would have come at a cost of a significantly higher discount. 

What differentiates this transaction from the ones done with L1 and Winance? Is this a “DSF”?
This transaction with Unwrap Finance Nordic is a regular directed share issue and has no relation to the kind of agreements that were signed with L1 Capital and Winance. Those agreements had transactions with convertibles and warrants linked to them. Neither of the agreements with L1 Capital or Winance were so-called DSF either, as Brighter protected its shareholders by making sure that the shareholders received free warrants and not just the investor. Following is a visualization of the Brighter share price development during the period of L1 Capital transactions.

Will there be additional directed share issues?
Yes, likely and Unwrap Finance is likely to be part of some of these. The priority, however, is to attract long-term institutional investors, but that is not short term.

Why are you not directing a share issue to larger institutional investors, with long-term focus, instead?
Larger institutional and professional value investors typically don’t invest smaller sums that would be appropriate in this situation. With Brighter’s current market cap of approximately SEK 600 million, a large investment would also lead to a significant dilution for the current shareholders.

However, it is a priority to bring aboard this type of investors and we are actively working on making that happen, taking into account the interests of shareholders. Key is to reach the next phase in our commercialization efforts.

Does this transaction affect the terms of the outstanding TO5 warrants?
No, according to the terms for TO5 a directed issue does not trigger a recalculation. This is standard terms for warrants. Recalculation is normally triggered by preferential rights issues (företrädesemission).

Q&A – Q2 2020 Interim report

We have received questions about how to interpret the financial statements in the Q2 report released on August 31. Below follows a clarification of Brighter’s financial position. 

If you have any additional questions that are not answered in the clarification, please contact IR@brighter.se directly.

What was Brighter’s financial position at the time of the report?

Cash available was a total SEK 23.5 Million, plus additionally SEK 42.7 million which is currently allocated for a short-term placement against interest (treated as a liquid asset). The SEK 7.4 million write-off is not an expected write-off from cash-flow but only to conform with IFRS to reflect a change in valuation of an underlying security.

Will Brighter need additional funding?

Yes, until Brighter reaches the stage of sales and revenue the company will need external funding, in line with Brighter’s expansion strategy.

How will Brighter keep financing the operations?

The company has a contract in place for additional funding covering routine operations for at least 12 months. 

Brighter is not considering a new rights issue or a contractual financing like the ones held with L1 Capital and Winance.

Further to that the Board and leadership team are working on and evaluating additional financing options to secure the funds and resources needed to pursue the ambitious expansion strategy. E.g. Directed share issues to institutions, family offices and other professional investors, and financial agreements/prepayments from large customers/distributors.