Semler Scientific (SMLR) Announces Proposed $75M Convertible Senior Notes Offering

Semler Scientific, Inc. (Nasdaq: SMLR) today announced that it intends to offer, subject to market conditions and other factors, $75.0 million aggregate principal amount of 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"). Semler Scientific also intends to grant 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 notes will be senior unsecured obligations of Semler Scientific and will accrue interest payable semiannually in arrears. 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. The interest rate, initial conversion rate, repurchase or redemption rights and other terms of the notes will be determined at the time of pricing of the offering. The offering is subject to market and other conditions, and there can be no assurance as to whether, when or on what terms the offering may be completed.

Semler Scientific intends to use a portion of the net proceeds from the offering to pay the cost of the capped call transactions described below and the remainder of the net proceeds for general corporate purposes, including the acquisition of bitcoin.

In connection with the pricing of the notes, Semler Scientific expects to enter into privately negotiated capped call transactions (the "capped call transactions") with one or more of the initial purchasers or their respective affiliates and/or other financial institutions (the "option counterparties"). The capped call transactions will 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 the notes, with such reduction subject to a cap. 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 the shares of Semler Scientific's common stock issuable upon conversion of the notes, if any, 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.

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