Venus Medtech-B (02500.HK): Convertible Bond Subscription Agreement Lapses; Plans to Repay Bridging Loan by March 2027

Venus Medtech (Hangzhou) Inc. (02500.HK) announced that under the subscription agreement (as amended), if the conditions precedent were not satisfied on or before the long stop date or such later date as the subscriber and the company may agree, the subscription agreement would lapse and become invalid. As certain conditions precedent were not satisfied or waived by the long stop date, and the company and the subscriber did not agree to any further extension of the long stop date, the subscription agreement lapsed and became invalid on June 30, 2026, and all obligations of the parties thereunder were discharged.

Under the framework agreement (as amended), if the overseas investment filing procedures were not completed by the relevant deadline, the company would be required to repay the bridging loan and corresponding unpaid interest to the subscriber by March 15, 2027, unless otherwise agreed. The subscriber had paid a bridging loan of RMB150 million to the company. As the overseas investment filing procedures were not completed by the deadline, and no further extension was agreed, the company plans to repay the bridging loan and corresponding unpaid interest to the subscriber no later than March 15, 2027.

The company also referred to an investment term sheet dated July 1, 2026, entered into with Hangzhou Gaoxin and Hangzhou Yingzhiqin, pursuant to which they expressed intention to jointly invest in the company through potential transactions (including potential share subscription and potential convertible bond subscription) with other potential investors, with a total investment amount of up to RMB500 million. Under the term sheet, within 30 business days after shareholder approval of the formal transaction documents, the subscription of new shares and/or convertible bonds with a total investment amount of RMB350 million (including the earnest money) must be completed. The signing date of the formal transaction documents is expected to be no later than August 31, 2026.

The board believes that if the potential transactions are realized and completed according to the timetable in the term sheet, the lapse of the subscription agreement will not have any material adverse effect on the group's existing business, operations, or financial condition. The investment term sheet is not legally binding (except for the earnest money arrangement), and the potential transactions thereunder are subject to the formal transaction documents to be entered into. Therefore, the potential transactions may or may not proceed.

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