The subscription period in Cyxone’s rights issue starts today

Today, 1 August 2024, the subscription period in Cyxone AB’s ("Cyxone" or "the Company") issue of shares (the "Rights Issue") of a maximum of SEK 23 million, with preferential right for the Company's existing shareholders, begins. The purpose of the capital acquisition is primarily to finance development programs with exploratory studies with the drug candidate rabeximod for patients who do not respond well to TNFa inhibitors and to finance development of T20K. The subscription period runs until 15 August 2024. A memorandum is available via the Company's (www.cyxone.com) website.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR TO THE UNITED STATES, AUSTRALIA, HONG KONG, JAPAN, CANADA, NEW ZEALAND, SWITZERLAND, SINGAPORE, SOUTH AFRICA, SOUTH KOREA, RUSSIA, BELARUS OR ANY OTHER JURISDICTION WHERE THIS PRESS RELEASE IS DISTRIBUTABLE WOULD BE ILLEGAL OR REQUIRE ADDITIONAL ACTIONS THAN SUCH ACTIONS RESULTING FROM SWEDISH LAW. SEE THE “IMPORTANT INFORMATION” SECTION AT THE END OF THIS PRESS RELEASE.

Background and motive

Despite advances in the treatment of rheumatoid arthritis (“RA”) and multiple sclerosis (“MS”), there is still a need for safer and more effective treatments for both indications.

Cyxone's product portfolio currently consists of two candidates – rabeximod and T20K. Rabeximod, a drug candidate for the treatment of moderately to severely active RA, has a favorable safety profile and is in clinical phase II. T20K is in preclinical development, ready for clinical development, for MS. Both candidates have mechanisms for growth in other indications; rabeximod can treat other autoimmune diseases and T20K can treat central nervous system (“CNS”) diseases.

The Company's goal is to offer new, effective, safe and easy-to-use medicines for autoimmune inflammatory conditions to improve patients' quality of life. Cyxone also aims to collaborate with established pharmaceutical companies in clinical phases to finance, develop and launch rabeximod globally.

For the next 12 months, the Company is in need of additional working capital. In order to continue development with rabeximod and T20K, the board has decided to carry out the Rights Issue. The primary purpose of the Rights Issue is to finance development programs with exploratory studies with the drug candidate rabeximod for patients who do not respond well to TNFa inhibitors, as well as to finance development of T20K and the overall operational activities.

Provided that the Rights Issue is fully subscribed, the Company has the resources to finance the operations and development plans for the Q3 2025. If the Company through the Rights Issue does not obtain the necessary capital to finance the operations for a period of at least 12 months ahead, the Company intends to evaluate alternative financing solutions.

Objectives

Below is a selection of the Company's objectives for the years 2024-2026.

• Initiation of collaboration with world-leading clinical experts for the treatment of patients who do not respond to treatment with TNF-alpha inhibitors.
• Preclinical studies to explore details of rabeximod's mechanism of action to guide prioritization of future clinical studies.
• Preclinical studies to investigate T20K's ability to halt the progression of MS symptoms in early, middle and late stages of development.
• Explore combinations of T20K and a kappa opioid receptor agonist (“KOR agonist”) to optimize efficacy versus safety in the EAE model.
• Preclinical studies to explore the potential use of rabeximod in other diseases where the pathophysiological processes are likely to be inhibited by rabeximod.
• Initiate partnership discussions in mid-late 2025 for rabeximod and/or T20K, depending on the results of the preclinical studies.
• Obtain advice from regulatory authorities and conduct a pre-IND program with a combination of T20K and a KOR agonist results from preclinical studies of T20K. Investigate the potential of T20K alone or in combination with KOR agonist in disease.
• Identify pharmaceutical partners that can fund clinical trials for T20K and/or rabeximod.

Terms for the Rights Issue

With the support an authorization from the Annual General Meeting, the Board decided, on 23 July 2024, on the implementation of an issue of a maximum of 575,802,760 shares, corresponding to approximately SEK 23 million. Cyxone's existing shareholders have preferential rights to subscribe for shares in proportion to their existing shareholdings. The general public also has the right to subscribe for shares in the Rights Issue.

One (1) existing share in the Company on the record date of 30 July 2024 entitles to one (1) subscription right. Three (3) subscription rights entitle the holder to subscribe for eight (8) shares. The subscription price in the Rights Issue has been set at SEK 0.04 per share.

Subscription for shares must take place during the subscription period that runs from and including 1 August 2024 to and including 15 August 2024. Subscription rights that are not used during the subscription period become invalid and lose their value. Trading in subscription rights will take place on Nasdaq First North Growth Market from and including 1 August 2024, to and including 12 August 2024. Trading in BTA (Paid Subscribed Share) will take place during the period from and including 1 August 2024, until the Rights Issue has been registered with the Swedish Companies Registration Office, estimated around 4 September 2024.

The Rights Issue will increase the share capital by a maximum of SEK 23,032,110.40, from SEK 8,637,041.44 to SEK 31,669,151.84 and the total number of shares will increase by a maximum of 575,802,760 shares, from 215,926,036 shares to 791,728,796 shares. Existing shareholders who choose not to participate in the Rights Issue will be recognized with a dilution effect corresponding to approximately 72.7 percent of the votes and capital, calculated on the number of shares in the Company after the Rights Issue has been fully subscribed. Shareholders who choose not to participate in the Rights Issue have the opportunity to partially compensate themselves for the financial dilution effect by selling their subscription rights no later than 12 August 2024.

Pre-subscription commitments

The Rights Issue is secured in writing by members of the board and management to a total of approximately 1.1 percent (equivalent to approximately SEK 260,000) through pre-subscription commitments. The commitments are not secured by bank guarantee or similar arrangements.

Timeplan for the Rights Issue

• Subscription period: 1-15 August 2024.
• Trading in subscription rights: 1-12 August 2024.
• Trading in BTA: from 1 August 2024 until the Rights Issue has been registered with the Swedish Companies Registration Office, estimated around 4 September 2024. The last day for trading in BTA will be announced through a separate press release after the rights issue has been completed.
• Press release on the outcome of the Rights Issue: around 16 August 2024.

Memorandum and teaser

A memorandum and a teaser about the Rights Issue are available via the Company's (cyxone.com) and Hagberg & Aneborn Fondkommission AB's (hagberganeborn.se) websites.

Advisors

In connection with the Rights Issue, Sedermera Corporate Finance AB assists the Company with project management, Markets & Corporate Law Nordic AB with legal advice and Hagberg & Aneborn Fondkommission AB with issuing services.

For more information about the Rights Issue, please contact:

Sedermera Corporate Finance AB
Phone: +46 (0)40 615 14 10
E-mail: [email protected]
sedermera.se

For more information about the Company, please contact:

Kjell Stenberg, CEO
Phone: +46 (0)70 781 88 08
E-mail: [email protected]
cyxone.com

Important information

This press release does not constitute an offer to acquire, subscribe for or otherwise trade in shares, warrants, subscription rights, BTA’s or other securities in Cyxone AB investors should not subscribe for or acquire any securities other than on the basis of the information in the information document that will be made public before the start of the subscription period in the Rights Issue. No action has been taken and no action will be taken to permit an offer to the public in any jurisdiction other than Sweden.

This press release may not be released, published or distributed, directly or indirectly, in or into the United States, Australia, Hong Kong, Japan, Canada, New Zealand, Switzerland, Singapore, South Africa, South Korea, Russia, Belarus or in any other jurisdiction where the distribution of this press release would be unlawful. Nor does this press release constitute an offer to sell new shares, warrants, subscription rights, BTA’s or other securities to any person in a jurisdiction where it would not be permitted to make such an offer to such a person or where such action would require prospectus, additional registration or other measures than under Swedish law. The information document, the application form and other documents relating to the Rights Issue may not be distributed in or into any country where such distribution or the Rights Issue requires measures referred to in the previous sentence or where they would be contrary to the rules of such country. Actions contrary to this instruction may constitute a violation of applicable securities laws.

Neither shares, warrants, subscription rights, BTA’s nor any other securities have been or will be registered under the United States Securities Act of 1933 in its current wording (the "Securities Act") or the securities laws of any state or other jurisdiction in the United States and may not be offered, subscribed for, exercised, pledged, sold, resold, assigned, delivered or otherwise transferred, directly or indirectly, in or into the United States except pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with the securities laws of any state or other jurisdiction of the United States.

This press release may contain certain forward-looking statements that reflect the Company's current views on future events and financial and operational development. Words such as "intends", " estimates", "expects", "may", "plans", "believes", " anticipates" and other expressions that imply indications or predictions of future developments or trends, and that are not based on historical facts, constitute forward-looking statements. By nature, forward-looking statements involve known and unknown risks and uncertainties because they depend on future events and circumstances. Forward-looking statements do not constitute a guarantee of future results or developments and actual outcomes may differ materially from those expressed in forward-looking statements. Neither the Company nor anyone else undertakes to review, update, confirm or publicly announce any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this press release, unless required by law or the rules of First North Growth Market.

About Cyxone

Cyxone AB (publ) (Nasdaq First North Growth Market: CYXO) develops disease modifying therapies 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 cyxone.com