Generic Announces a Rights Offering

In order to strengthen the company’s financial position and to enable more long-term development of its operations, the Board of Directors has decided to propose a new share issue of SEK 10.1 million with preferential subscription rights for existing shareholders. The proposal is subject to approval at an extraordinary general meeting on November 23, 2009, and is contingent upon the new share issue being fully covered by subscription commitments and guarantees.

Summary
 A rights offering of 10.1 MSEK with preferential subscription rights for existing shareholders in Generic
 Five (5) existing shares entitle the holder to subscribe for four (4) new shares at an issue price of 1.85 kronor per share
 The rights offering is conditional upon approval at an extraordinary general meeting on November 23, 2009
 The record date is November 26, 2009, and the subscription period runs from November 30 to December 14, 2009
 The rights offering is being conducted to strengthen the company’s financial position and to enable more long-term development of its operations
 The resolution is conditional upon the new share issue being fully covered by subscription commitments and guarantees.

Background and Rationale
Generic’s strategy is to be a specialized service provider in the fields of communication, information management, security, and systems development. The company believes in long-term growth in all sectors in which it operates. The goal is for all operating companies and the Group to be profitable, demonstrate sound and profitable growth, and be a leading company in Sweden within selected niches.

The company is implementing extensive efficiency measures that have begun to have a positive impact on its economic and financial performance; see the interim report for January–September 2009.
After a period of focusing entirely on cost control and streamlining, the company is now in a position to carry out strategic hiring and other initiatives to drive growth.

However, the company’s financial position deteriorated in 2009 as a result of profitability issues in both the consulting and telecommunications operations, which—together with high restructuring costs, primarily in the parent company, and extraordinary payments resulting from the compulsory redemption of minority shares in Generic Mobile—have led to a decline in the company’s liquidity and equity ratio.
The Board of Directors and management have determined that it is in the best interest of Generic’s shareholders to strengthen the capital base, reduce the debt burden, and generate resources for growth by raising new capital through a new share issue.

“Generic is undergoing a comprehensive transformation process, with the short-term goal of streamlining operations and achieving profitability on a monthly basis, both overall and for each business segment. The intention for 2010 is to return to a phase of profitable growth. To strengthen the company’s capital base and liquidity and facilitate its long-term development, the Board of Directors proposes a new share issue of approximately 10 MSEK,” says the company’s Chairman of the Board, Stig-Arne Larsson.

Main Terms and Conditions
Five (5) existing shares entitle the holder to subscribe for four (4) new shares. The issue price is 1.85 kronor per share. The record date is November 26, 2009, and the subscription period runs from November 30 to December 14, 2009. Following the new share issue, the number of shares in Generic will increase by a maximum of 5,463,120 shares to a maximum of 12,292,020 shares, and the share capital will increase by a maximum of 4,370,496 SEK to a maximum of 9,833,616 SEK.

Subscription Commitments and Guarantee Undertakings
The decision is contingent upon the new share issue being fully covered by subscription commitments and guarantees. An announcement will be made once such commitments and guarantees have been entered into.

Preliminary Schedule
Nov. 23, 2009 Extraordinary General Meeting
Nov. 24, 2009 Shares traded excluding the right to participate in the new share issue
Nov. 26, 2009 Record date for participation in the new share issue
Nov. 30 – Dec. 14, 2009 Subscription period for the new share issue
Nov. 30 – Dec. 9, 2009 Trading in subscription rights
Nov. 30, 2009 Trading in paid-up subscribed shares begins and continues until the new share issue has been registered with the Swedish Companies Registration Office

For further information, please refer to the upcoming information brochure regarding the rights offering, which is expected to be published in week 48.

Extraordinary General Meeting Following the Board of Directors’ decision regarding a new share issue, the Board will convene an Extraordinary General Meeting to be held on November 23, 2009. For further information regarding the Extraordinary General Meeting, please refer to the notice of meeting, which is expected to be published shortly.

Financial Advisors
Remium AB is acting as financial advisor to Generic in connection with the rights offering.

Nacka, November 5, 2009

The Board of Directors of Generic Sweden AB (publ)

wkr0011.pdf