Cyxone AB carries out a rights issue of shares of approximately MSEK 36.3

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The Board of Directors in Cyxone AB (“Cyxone” or the “Company”) has today, September 25, 2023, subject to subsequent approval at the Extraordinary General Meeting on October 27, 2023, resolved to carry out a rights issue of not more than 213,296,902 shares of approximately MSEK 36.3 before issuing costs (the “Rights Issue”). In connection with the Rights Issue, the Company has received subscription and guarantee commitments of approximately MSEK 20 from members of the Company’s management team, Board of Directors and external investors, corresponding to approximately 55 percent of the Rights Issue. The proceeds from the Rights Issue are primarily intended to be used to finance further clinical development for the Rabeximod and T20K programs. Notice of the Extraordinary General Meeting will be published through a separate press release.

• One (1) existing share in Cyxone entitles to one (1) subscription right. Six (6) subscription rights entitles to subscribe for thirteen (13) shares.
• The subscription price has been set to SEK 0.17 per share. Upon full subscription in the Rights Issue, the Company will receive approximately MSEK 36.3 before deduction of issue costs.
• The record date for the Rights Issue is November 3, 2023 and the subscription period runs from and including November 7, 2023 up and including November 21, 2023.
• The last day for trading with a right to participate in the Rights Issue is November 1, 2023.

Cyxone is a biotechnology company in the clinical phase, specializing in the development of new treatments against autoimmune and autoinflammatory diseases. The Company is run by leading people in pharmaceuticals and biotechnology as well as graduates with extensive experience and expertise in immunotherapy.

The Company's product portfolio currently consists of two substances: Rabeximod and T20K. Rabeximod is a solution with a new and unique mechanism of action and a favorable safety profile that is currently being developed for oral use in patients with moderate to severe active rheumatoid arthritis (RA) who are in clinical phase 2. T20K is a solution with a new and unique mechanism of action that in currently being developed for oral use in patients with multiple sclerosis (MS) and who are in the preclinical phase. The mechanism of action of both of the Company's substances, Rabeximod and T20K, enables development in additional indications, where Rabeximod is considered to be developed against other autoimmune diseases and T20K is considered to be developed against indications within the CNS (central nervous system).

Rabeximod, an oral synthetic DMARD in phase 2 with a novel mechanism of action that has shown efficacy in patients with moderate to severe rheumatoid arthritis, is a leading contender to address the increased inadequate response to biologic DMARDs, such as TNFα inhibitors.

In light of this, Cyxone has decided to change its development strategy to focus on this growing market segment with patients who do not experience sufficient improvement with current treatment options.

In addition to the change in priority, the costs for the new planned development program will be lower in 2024-2025 than previously estimated, and that know-how and material assets from previous studies will be transferred to the new development activities and form the basis for "proof-of-concept"-studies in phase 2. It is important to highlight that the new strategy builds on the recent progress in the development of the new formulation of Rabeximod which resulted in a valuable approved patent in the US in May 2023, extending the patent life by another 20 years.

The company is now carrying out a rights issue primarily to finance the planning and performance of a fast-tracked development program consisting of explorative proof-of-concept studies in Phase 2 to study the drug candidate in patients who respond poorly to the drug class TNFα inhibitors. The net proceeds will cover the financing needs until 2025.

Upon full subscription in the Rights Issue, the Company will receive net proceeds of approximately MSEK 30.6 after deduction of issue costs. The net proceeds are intended to be used for the following purposes listed in order of priority:

• Financing of further clinical development for the programs with Rabeximod and T20K. Expected to constitute approximately 58 percent of the issue proceeds.
• Financing of the Company's ongoing operations including strengthening of the Company's capital structure, personnel costs and IT. Expected to constitute approximately 35 percent of the issue proceeds.
• Business development, patents, quality assurance and regulatory processes. Expected to constitute approximately 7 percent of the issue proceeds.

The Board of Directors of Cyxone has today, September 25, 2023, subject to subsequent approval at the Extraordinary General Meeting on October 27, 2023, resolved to carry out the Rights Issue in accordance with the following main conditions:

• The rights issue comprises a maximum of 98,444,728 subscription rights corresponding to a maximum of 213,296,902 shares. Upon full subscription in the Rights Issue, Cyxone will receive approximately MSEK 36.3 before issuing costs.
• Anyone who on the record date, 3 November 2023, is entered in the share registry maintained by Euroclear Sweden AB has preferential rights to subscribe for shares in the Rights Issue.
• One (1) existing share held on the record date entitles to one (1) subscription right. Six (6) subscription rights entitle to subscription of thirteen (13) new shares.
• The subscription price in the Rights Issue amounts to SEK 0.17 per share.
• The rights issue corresponds to a valuation of Cyxone (pre-money) of approximately MSEK 16.7.
• The subscription period in the Rights Issue runs during the period 7 November 2023 – 21 November 2023.
• Trading in BTA (Paid Subscribed Share) will take place on Nasdaq First North Growth Market from and including November 7, 2023, until the Rights Issue is registered with the Swedish Companies Registration Office, which is expected to take place around week 49, 2023.
• Upon full subscription of shares in the Rights Issue, the Company will receive approximately MSEK 36.3 before deduction of issue costs. The issue costs for the Rights Issue are estimated to amount to approximately MSEK 5.6, of which guarantee compensation amounts to a maximum of approximately MSEK 2.8 in the event that all underwriters choose payment in full in cash.
• If not all shares are subscribed with the support of subscription rights, the allocation of the remaining shares within the framework of the Rights Issue’s maximum amount shall take place: primarily to those who have subscribed for shares with the support of subscription rights (regardless of whether they were shareholders on the record date or not) and who have registered an interest in subscription of shares without the support of subscription rights and in the event that allocation to these cannot take place in full, allocation must be made pro rata in relation to the number of subscription rights that each of those who have declared an interest in subscribing to shares without the support of subscription rights used for subscription of shares; secondarily to others who subscribed for shares in the Rights Issue without the support of subscription rights and in the event that allocation to these cannot take place in full, allocation must be made pro rata in relation to the total number of shares for which the subscriber has registered for subscription; and thirdly to those who have submitted guarantee commitments regarding the subscription of shares, in proportion to such guarantee commitments. To the extent that allocation in any stage according to above cannot be done pro rata, allocation shall occur by drawing lots.
• Complete terms and conditions for the Rights Issue and other information about the Company will be set out in the EU Growth Prospectus that is expected to be published on or about 6 November 2023 (the “Prospectus”).

Cyxone has received subscription undertakings of approximately MSEK 0.1, corresponding to approximately 0.2 percent of the Rights Issue, from the CEO and as well as one existing shareholders. In addition, the Company has entered into agreements on guarantee commitments with external and existing investors including members of the Company’s Board of Directors of approximately MSEK 19.9, corresponding to approximately 54.9 percent of the Rights Issue. In total the Company has received subscription undertakings and guarantee commitments totaling approximately MSEK 20, corresponding to approximately 55 percent of the Rights Issue.

For the guarantee commitments, a cash compensation is paid of fourteen (14) percent of the guaranteed amount, or if the guarantors choose to receive compensation in the form of newly issued shares in the Company, seventeen (17) percent of the guaranteed amount. However, member of the board of directors who have provided a guarantee commitment can only opt for cash compensation In the event that the guarantor chooses to receive compensation in the form of newly issued shares in the Company, the subscription price per share shall correspond to the subscription price in the Rights Issue. No remuneration is paid for the subscription undertakings.

In order to enable new issues of shares as guarantee compensation to the guarantors who choose to receive guarantee compensation in newly issued shares, the Board of Directors has proposed that the Extraordinary General Meeting on October 27, 2023, which is proposed to resolve on the approval of the Rights Issue, also resolves on authorization for the Board of Directors to resolve on new issues of such shares to guarantors.

• 1 November 2023: Last day of trading in the Company’s share with the right to participate in the Rights Issue.
• 2 November 2023: First day of trading in the Company’s share excluding the right to participate in the Rights Issue.
• 3 November 2023: Record date for the right to participate in the Rights Issue.
• 6 November 2023: Estimated date for publication of the Prospectus.
• 7 November 2023 – 16 November 2023: Trading in subscription rights takes place on Nasdaq First North Growth Market.
• 7 November 2023 – 21 November 2023: Subscription period.
• 7 November 2023 until the Swedish Companies Registration Office has registered the Rights Issue: Trading in paid subscribed shares (BTA).
• 24 November 2023: Estimated date for the announcement of outcome in the Rights Issue.

The Board of Directors will propose to the Extraordinary General Meeting on October 27, 2023 that the share capital shall be reduced with SEK 3,491,999.378868 from SEK 7,429,788.498868 to SEK 3,937,789.120. This reduction will mean that the quota value per share is reduced from approximately SEK 0.075472 to SEK 0.04. Upon full subscription in the Rights Issue, the number of shares in the Company will increase by a maximum of 213,296,902 shares from 98,444,728 to 311,741,630 and the share capital will increase by a maximum of SEK 8,531,876.08 from SEK 3,937,789.120 to approximately SEK 12,469,665.20 (calculated on the new quota value following the contemplated share capital decrease proposed by the Board of Directors to the Extraordinary General Meeting on October 27, 2023). For existing shareholders not participating in the Rights Issue this will entail, upon full subscription, a dilution effect of approximately 68.4 percent of the shares and votes in the Company.

If all underwriters who have given guarantee undertakings in the Rights Issue choose to receive remuneration in the form of newly issued shares, a maximum of 19,308,000 new shares will be issued in the directed issue. This entails a dilution of approximately 5.83 percent based on the number of shares in the Company after completion of the Rights Issue (assuming full subscription in the Rights Issue).

The Board of Directors’ resolution on the Rights Issue is subject to approval by the Extraordinary General Meeting on October 27, 2023. Notice of the Extraordinary General Meeting will be announced in a separate press release.

Full terms and conditions for the Rights Issue, as well as other information about the Company and information about subscription undertakings and guarantee commitments will be presented in the Prospectus that is expected to be published on 6 November 2023.

Corpura Fondkommission AB (www.corpura.se) is financial advisor and Setterwalls Advokatbyrå AB is legal advisor to Cyxone in connection with the Rights Issue. Hagberg & Aneborn Fondkomission AB acts as issuing agent.

Carl-Magnus Högerkorp, CEO
Tel: 070 781 88 12
E-mail: carl.hogerkorp@cyxone.com

This information is such information as Cyxone AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above on 25 September 2023.

Cyxone AB (publ) (Nasdaq First North Growth Market: CYXO) develops disease-modifying treatments for diseases such as rheumatoid arthritis and multiple sclerosis. Rabeximod is a Phase 2 candidate drug being evaluated for the management of rheumatoid arthritis. T20K is a Phase 1 candidate drug for treatment of multiple sclerosis. Certified Adviser is FNCA Sweden AB. For more information, please visit www.cyxone.com

The information in this press release does not contain or constitute an offer to acquire, subscribe or otherwise trade in shares or other securities in Cyxone. No action has been taken and measures will not be taken to permit a public offering in any jurisdictions other than Sweden. Any invitation to the persons concerned to subscribe for shares in Cyxone will only be made through the Prospectus that Cyxone estimates to publish on November 6, 2023 on Cyxone’s website, www.cyxone.com. The upcoming approval of the Prospectus by the Swedish Financial Supervisory Authority shall not be regarded as an approval of the shares or any other securities. This release is however not a prospectus in accordance with the definition in the Prospectus Regulation (EU) 2017/1129 (“Prospectus Regulation”) and this announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in shares or other securities in Cyxone. In order for investors to fully understand the potential risks and benefits associated with a decision to participate in the Rights Issue, any investment decision should only be made based on the information in the Prospectus. Thus, investors are encouraged to review the Prospectus in its entirety. In accordance with article 2 k of the Prospectus Regulation this press release constitutes an advertisement.

The information in this press release may not be released, distributed or published, directly or indirectly, in or into the United States of America, Australia, Belarus, Canada, Hong Kong, Japan, New Zealand, Russia, Singapore, South Africa, South Korea, Switzerland or any other jurisdiction in which such action would be unlawful or would require registration or any other measures than those required by Swedish law. Actions in violation of these restrictions may constitute a violation of applicable securities laws. No shares or other securities in Cyxone have been registered, and no shares or other securities will be registered, under the United States Securities Act of 1933, as amended (the “Securities Act”) or the securities legislation of any state or other jurisdiction in the United States of America and no shares or other securities may be offered, sold or otherwise transferred, directly or indirectly, in or into the United States of America, except under an available exemption from, or in a transaction not subject to, the registration requirements under the Securities Act and in compliance with the securities legislation in the relevant state or any other jurisdiction of the United States of America.

Within the European Economic Area (“EEA”), no public offering of shares or other securities (“Securities”) is made in other countries than Sweden. In other member states of the EU, such an offering of Securities may only be made in accordance with the Prospectus Regulation. In other member states of the EEA which have implemented the Prospectus Regulation in its national legislation, any offer of Securities may only be made in accordance with an applicable exemption in the Prospectus Regulation and/or in accordance with an applicable exemption under a relevant national implementation measure. In other member states of the EEA which have not implemented the Prospectus Regulation in its national legislation, any offer of Securities may only be made in accordance with an applicable exemption under national law.

In the United Kingdom, this document and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, “qualified investors” (within the meaning of the United Kingdom version of the EU Prospectus Regulation (2017/1129/ EU) which is part of United Kingdom law by virtue of the European Union (Withdrawal) Act 2018) who are (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); (ii) high net worth entities etc. falling within Article 49(2)(a) to (d) of the Order; or (iii) such other persons to whom such investment or investment activity may lawfully be made available under the Order (all such persons together being referred to as “relevant persons”). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.

This press release may contain forward-looking statements which reflect the Company’s current view on future events and financial and operational development. Words such as “intend”, “expect”, “anticipate”, “may”, “believe”, “plan”, “estimate” and other expressions which imply indications or predictions of future development or trends, and which are not based on historical facts, are intended to identify forward-looking statements. Forward-looking statements inherently involve both known and unknown risks and uncertainties as they depend on future events and circumstances. Forward-looking statements do not guarantee future results or development and the actual outcome could differ materially from the forward-looking statements.

The English text is an unofficial translation of the original Swedish text. In case of any discrepancies between the Swedish text and the English translation, the Swedish text shall prevail.