Hofseth Biocare ASA: PRIVATE PLACEMENT SUCCESSFULLY PLACED

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES OR ANOTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.

(Ålesund, 3 July 2022) Reference is made to the stock exchange release from Hofseth Biocare ASA ("HBC" or the "Company") published on 1 July 2022 regarding a contemplated private placement.

The Company hereby announces that it has allocated 35,490,000 new shares in the Company (the "Offer Shares") in a private placement (the "Private Placement") at a subscription price of NOK 4.00 per Offer Share (the "Offer Price"), thereby raising gross proceeds of approximately NOK 141 million. The Private Placement was oversubscribed on the time of completion.

The net proceeds of the Private Placement will be used for general corporate purposes. The Company is also in the process of securing more fresh salmon raw material off-cuts from nearby external sources to enable the factory at Midsund to operate above 80% capacity utilization at all times. The increase in demand for HBC’s human grade ingredients made from salmon by-products over the past 12 months has increased meaningfully from both the Petcare and nutraceutical channels. There is now a strong pipeline building for which more consistent raw materials input is required.

Notification of allotment of the Offer Shares including settlement instructions will be sent to the applicants through a notification from the Company on or about 4 July 2022. The Offer Shares will be settled towards the investors in the Private Placement as soon as practicable after full payment has been received and the share capital increase pertaining to the Private Placement has been registered in the Norwegian Register of Business Enterprises. The Offer Shares allocated in the Private Placement will be settled partially through cash payment and partially through conversion of debt and outstanding trade credits (a total of NOK 71,200,760).

In order to increase the share capital pertaining to the Private Placement, the Company's board of directors has resolved to issue 35,490,000 new shares in the Company pursuant to the authorization granted by the Company's annual general meeting on 29 April 2022. As disclosed in the stock exchange notice from 1 July 2022, the share capital increase pertaining to the Private Placement has been divided into two separate resolutions, pursuant to which Aqua-Spark will pay for shares allocated to it within 24 July 2022. Consequently, the share capital of the Company will be increased with NOK 354,900. Following registration of the two resolutions to increase the share capital, the Company will have 393,321,030 shares outstanding, each with a par value of NOK 0.01.

Completion of the Private Placement remains subject to payment of all share deposits and registration with the Norwegian Register of Business Enterprises of the share capital increase in the Company pertaining to the Private Placement.

When resolving the issuance of the Offer Shares in the Private Placement, the Company's board of directors considered the structure of the Private Placement in light of the equal treatment obligations under the Norwegian Securities Trading Act and Oslo Børs' Circular no. 2/2014 and is of the opinion that it was in the common interest of the Company and its shareholders to raise equity through the Private Placement. By structuring the equity raise as a private placement, the Company was able to raise equity efficiently, with no discount to the current trading price, at a lower cost and with a significantly lower risk compared to a rights issue. Further, the Offer Price was fixed to a premium towards the prevailing market price of the Company's shares. Based on the foregoing, it is not planned to conduct a subsequent repair issue directed towards shareholders not participating in the Private Placement. As a consequence of the Private Placement structure, the shareholders' preferential rights were deviated from.

Advokatfirmaet CLP DA acts as Norwegian legal counsel in connection with the Private Placement.

For further information, please contact:

Jon Olav Ødegård, CFO at HBC
Phone: +47 936 32 966
E-mail: [email protected]

James Berger, CCO at HBC
Phone: +41 79 950 1034
E-mail: [email protected]

About HBC:

HBC is a Norwegian consumer and pet health ingredient supplier and an incubator for new pharmaceutical drug leads. Research is ongoing to identify the individual elements within its ingredients that modulate inflammation and the immune response with pre-clinical studies ongoing in multiple clinics and university research labs. Lead clinical and pre-clinical candidates are focused on developing an oral treatment for inflammatory disease driven by eosinophils (a type of white blood cell). Clinical trial work with the oil is ongoing to ameliorate lung inflammation in eosinophilic asthma and COPD ("smokers lung") as well as in COVID. Other leads are focused on the protection of the Gastro-Intestinal (GI) system against inflammation (including ulcerative colitis and the orphan condition necrotising enterocolitis) and using peptide fractions of salmon protein hydrolysate (SPH also known as 'ProGo') as a Medical Food to help treat age-related Sarcopenia, and as a treatment for Iron Deficiency Anemia.

The company is founded on the core values of sustainability, optimal utilization of natural resources and full traceability. Through an innovative hydrolysis technology, HBC can preserve the quality of the lipids, proteins and calcium from fresh salmon off-cuts. HBC's headquarters are in Ålesund, Norway with branches in Oslo, London, Zürich, Ningbo, New Jersey and Palo Alto.

HBC is listed on Oslo Børs with ticker "HBC". More information about HBC at hofsethbiocare.com and facebook.com/hofsethbiocare.

This information was considered to be inside information pursuant to the EU Market Abuse Regulation. This stock exchange announcement was published by Jon Olav Ødegård, Chief Financial Officer, on the time and date provided.