Relief Therapeutics Holding AG (RLFTF)

[threebabiesbusy]

Re-Post from DD Police on the Yahoo Board. Worthwhile and good analysis. Thank you for taking the time to put this together...DD Police.

DD POLICE - 8 hours ago
A lot of confusion on capital structure of Relief Therapeutics. I have done some DD and below are my conclusions. The Six Exchange website is our source for info, but unfortunately it is very poorly represented and not up to date. That said, I have done my best and believe I am correct in my findings. Hopefully our Swiss Friends on the Cash.Ch forums can read this, as they seem confused as well:

https://www.ser-ag.com/en/resources/notifications-market-participants/significant-shareholders.html#/shareholder-details/TAK9200037

GEM does not own 64% of Relief.
From the link above GEM owns 707,475,186 shares which represents 30.93% of voting rights.
707,475,186/30.93% = 2,287,342,987 shares outstanding. We know based on latest PR that Share count is at 2.534b shares and not 2.287b. So Six is using outdated share count here.
Add up all of the options in the link above that GEM owns and you get another 733,325,334 shares after exercise.
Six also lists another potential 25,781,293 shares if Relief exercises it’s SSF (Share Subscription Facility) with GEM at a price of 0.488CHF. RLF doesn’t have to use this facility.
707,475,186 + 733,325,334 + 25,781,293 = 1,466,581,813 potential shares outstanding the GEM may eventually hold
Now here is where Six math makes no sense at all, but it is how they do it. After exercising options, they assume the share count doesn’t increase. In my experience when warrants get exercised a company will typically issue new shares (authorized shares are used here for example). But let’s play along with Six Exchange:
1,466,581,813/2,287,342,987 = 64.117%

This is where Six gets it’s 64.11%

And it is entirely incorrect!

Here is more realistic math. I can’t guarantee it is correct, because I don’t know all of the contracts they signed on these warrants and options, but using an assumption that all of these warrants and options are standard contracts (very likely) here it goes:

We know from latest PR that share count is 2.534b (this includes the 66.667m shares that GEM took from Yves for 0.01HCF that are not included on Six yet, since they say they weren’t delivered yet according to Six).
As I previously posted; all options and warrants amount to 695m, including GEM (who has 733m -66.7m = roughly 667m of those 695m). The rest belongs to management team and others.
https://www.ser-ag.com/de/resources/notifications-market-participants/significant-shareholders.html#/shareholder-details/TAK8R00056

This confirms the numbers at 695,576,325 warrants/options outstanding (after the 66.7m Yves Options got exercised) of which GEM holds 666,658,667 (The Devil is in the details ?? )
Fully diluted share count stands at 3.23b. This is an important number and that is why I talked about it in my past posts (may have used slightly different number due to rounding error). It is the number I use to determine market cap and future value of the company.
GEM fully diluted, i.e. after exercising all options will have 1,466,581,813 shares (as calculated above)
Total Share Count Fully Diluted will be 695,576,325 + 2,534,168,581 = 3,229,744,906 (same 3.23b number above)
All options/warrants have strike price under 0.04 CHF and vast majority at 0.01 CHF, so all are guaranteed to get exercised.
GEM fully diluted, after all options/warrants are exercised will have 1,466,581,813 shares. But we have to exclude the 25,781,293 shares from the SSF that Relief may never use (not certain like option/warrant exercise):
1,466,581,813 – 25,781,293 = 1,440,800,520 shares fully diluted for GEM
1,440,800,512/3,229,744,906 = 44.61% ownership of the entire company.

Apparently, there are Six Exchange rules where if a shareholder owns more than 33.33% (one third) of a company’s shares outstanding it has to make an offer to purchase the entire company. But in 2019, Relief past a statute that anyone can buy more than 33.33% of it’s shares and not have to make an offer to buy out the whole company (sounds like it was tailormade for GEM).

There you have it. GEM does not own 64% of the company. It currently owns:

707,475,186 + 66,666,667 = 774,141,853 shares after the Yves called shares get delivered.
Current share ownership:
774,141,853/2,534,168,581 = 30.55%
Once again, fully diluted will be 44.61%