Carbiotix

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Erik Deaner, CEO of Carbiotix, comments
”Carbiotix's transition to becoming a commercial business is almost a reality, as we are finally approaching GRAS SA approval and can open up opportunities for the sale of CarbiAXOS as a dietary supplement in the US, as well as with a recent approval for cosmetics giving us opportunities for sales in the US and EU. With all the significant progress we have made during 2023, we are well prepared for the transition to a full-fledged commercial operation with the upcoming Rights Issue."

Motive and use of proceeds
Carbiotix is well on its way to becoming a commercial operation and to finance this change, Carbiotix is carrying out the Rights Issue, which, if fully subscribed, will initially provide the Company with approximately SEK 18.7 million before transaction related costs. Upon full subscription of the Rights Issue and full use of issued TO 3 at the highest exercise price, the Company may receive another maximum of approximately SEK 7.5 million before transaction related costs. The transaction related costs for the Rights Issue are estimated to amount to a maximum of approximately SEK 3.2 million (of which approximately SEK 1.4 million refers to guarantee compensation, provided that all guarantors desire cash compensation). The issue proceeds will also be used for repayment of bridge loans.

It is the Board's assessment that the net proceeds from the full subscription level of the Rights Issue are sufficient to finance the Company's ongoing operations and plans up to and including 2024, for example to complete GRAS SA processes and accelerate the sale of CarbiAXOS dietary supplements and cosmetic ingredients.

Objectives
Below is a selection of the Company's goals for the years 2023-2025.

2023
• Increase production of samples from Bjuv for various internal and external safety, efficacy and validation tests for dietary supplement and cosmetic applications.
• Complete the GRAS SA process for CarbiAXOS from corn fiber to enable customer samples and orders to be fulfilled through Carbiotix contract manufacturing partners in the US.
• Complete the ongoing CarbiAXOS Metformin study for patients with type 2 diabetes and submit an EU application for funding to be able to expand this study to several hundred patients.

2024
• Submit the first patent application for CarbiAXOS as an advanced symbiotic product.
• Submit a Novel Foods application allowing the sale of CarbiAXOS in Europe as a dietary supplement ingredient.
• Upgrade the production facility in Bjuv with a spray dryer to expand the production capacity of CarbiAXOS and, among other things, becoming less dependent on third parties.
• Start the sale of CarbiAXOS cosmetic ingredients globally and thus the production at the plant in Bjuv to meet the growing demand.
• Continue with sales efforts of CarbiAXOS for dietary supplement and cosmetic applications in the US via direct sales, trade shows and appropriate distribution networks/partners.
• Complete validation tests of CarbiAXOS based on recycled oat and pea fibers and complete the GRAS SA process for at least one of these fibers.
• Upon successful funding application; start an extended CarbiAXOS Metformin study.

2025
• Complete the Novel Foods process for CarbiAXOS based on corn fiber and start sales of CarbiAXOS for dietary supplement applications in the EU.
• Identify a European contract manufacturing partner to support a faster scale-up, as well as expand the production facility in Bjuv to meet growing demand for both cosmetic and dietary supplement ingredients.
• Continue to grow sales of CarbiAXOS for dietary supplement applications in the US and evaluate the need for a Carbiotix manufacturing facility in the US.
• Complete the extended CarbiAXOS Metformin study and secure at least one cotreatment partner and continued studies in other indication areas.

Terms for the Rights Issue
The Board has today, subject to the approval of the extraordinary general meeting, decided on the implementation of an issue of a maximum of 20,736,229 units consisting of a maximum of 186,626,061 shares and a maximum of 62,208,687 warrants of series TO 3. Carbiotix's existing shareholders have preferential rights to subscribe for units in proportion to their existing shareholdings. The public also has the right to subscribe for units in the Rights Issue.

One (1) existing share in the Company on the record date of January 15, 2024, entitles to one (1) unit right. One (1) unit right entitles the holder to subscribe for one (1) unit in Carbiotix. Each unit consists of nine (9) shares and three (3) warrants of series TO 3. The subscription price in the Rights Issue has been set at SEK 0.90 per unit, which corresponds to SEK 0.10 per share. Subscription options of series TO 3 are issued free of charge.

Subscription of units must take place during the subscription period that runs from and including January 17, 2024, to and including January 31, 2024. Unit rights that are not used during the subscription period become invalid and lose their value. Trading in unit rights is expected to take place on the Spotlight Stock Market from and including January 17, 2024, to and including January 26, 2024. Trading in BTU (Paid Subscription Unit) is expected to take place during the period from and including January 17, 2024, until the Rights Issue registered with the Swedish Companies Registration Office.

The Rights Issue will initially increase the share capital by a maximum of SEK 18,662,606.10, from SEK 2,736,22.90 to SEK 20,736,229.00 (before reduction of the share capital) and the total number of shares will increase by a maximum of 186,626,061 shares, from 20,736,229 shares to 207,362,290 shares. Existing shareholders who choose not to participate in the Rights Issue will be recognized with a dilution effect corresponding to approximately 90 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 January 26, 2024.

Terms for warrants of series TO 3
One (1) TO 3 gives the holder the right to subscribe for one (1) new share in Carbiotix during the period that runs from and including June 5, 2024, to and including June 19, 2024. The subscription price for TO 3 shall amount to seventy (70) percent of the average volumeweighted price of the share according to the official price statistics of the Spotlight Stock Market during a period of twenty (20) trading days ending two (2) banking days before the beginning of the exercise period and the subscription price will be determined within the range where the quota value at the relevant time is the lowest price per new share and SEK 0.12 per new share is the highest price in the range. The subscription price must be rounded to the nearest whole öre. The Company will announce the subscription price the day before the first day of the usage period. Upon full subscription of the Rights Issue and full utilization of TO 3 issued thereby at the highest subscription price, the Company may receive a maximum of approximately SEK 7.5 million before transaction costs, which are estimated to amount to approximately SEK 0.6 million.

Through TO 3, the share capital can increase by a maximum of SEK 622,086.87 (before reduction of the share capital). Provided that the Rights Issue is fully subscribed and that TO 3 is fully utilized, TO 3 will result in a dilution of approximately 23 percent of the votes and capital. TO 3 is planned to be admitted to trading on the Spotlight Stock Market as soon as possible after final registration of the Rights Issue with the Swedish Companies Registration Office. The last day of trading in TO 3 is expected to be June 17, 2024.

Pre-subscription and guarantee commitment agreements
The Rights Issue is secured in writing by members of the Board, management, certain existing shareholders and external investors to a total of approximately 60 percent (equivalent to approximately SEK 11.2 million) through pre-subscription and bottom guarantee commitments. The pre-subscription commitments amount to approximately SEK 2.3 million, which corresponds to approximately 12.2 percent of the Rights Issue. The guarantee commitments amount to a total of approximately SEK 8.9 million, corresponding to approximately 47.8 percent of the Rights Issue.

For the guarantee commitment, a guarantee fee of 15 percent in cash or 20 percent in the form of newly issued units, which are issued on the same terms as the Rights Issue, is paid. No compensation is paid for the subscription commitments that have been submitted.

The pre-subscription and guarantee commitments are not secured by bank guarantee, blocking funds, pledging or similar arrangements.

Bridge loan
In order to secure the Company's short-term working capital need until the liquidation from the Rights Issue accrues to Carbiotix, the Company has taken out a bridging loan of a total of SEK 3 million from Formue Nord Markedsneutral A/S. For the bridging loan, an interest rate of 1.5 percent is paid per started 30-day period. The bridge loan is intended to be repaid with cash from the rights issue. The Board of Directors of the Company assesses the terms of the bridging loan as market-based.

Lock up
Through lock-up agreements, with Sedermera Corporate Finance AB as counterparty, the Board and management have undertaken, with customary exceptions, not to sell any of the existing shareholding or such shareholding that is added through subscription in the Rights Issue, during a period of six months after the Rights Issue has been implemented.

Extraordinary General Meeting
The Board's decision on the Rights Issue is subject to approval at an Extraordinary General Meeting which is scheduled to be held on January 10, 2024. The decision on the Rights Issue presupposes and is conditional on changes to the limits of share capital and number of shares in the articles of association, as well as a reduction of the share capital in order to lower the shares' quota value and thus release capital from the Rights Issue at the disposal of the business under company law, is decided in accordance with the board's proposal to the extraordinary general meeting. The maximum reduction of the share capital will not exceed the share capital increase that takes place through the Rights Issue. The share capital will therefore be reduced by SEK 18,662,606.10 at most. Notice of the Extraordinary General Meeting is published through a separate press release.

Indicative timeline for the Rights Issue
• Last day for trading in shares, including the right to receive unit rights: 11 January 2024.
• First day for trading in shares, excluding the right to receive unit rights: 12 January 2024.
• Record date for participation in the Rights Issue: 15 January 2024.
• Subscription period: 17-31 January 2024.
• Trading in unit rights: 17-26 January 2024.
• Trading in BTU: from 17 January 2024 until the Rights Issue has been registered with the Swedish Companies Registration Office. The last day for trading in BTU 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 1 February 2024.

Memorandum, teaser and the possibility to subscribe for units
Memorandum and teaser about the Rights Issue will be made available via the Company's (www.carbiotix.com), Sedermera Corporate Finance AB's (www.sedermera.se) and Nordic Issuing AB's (www.nordic-issuing.se) websites no later than the subscription period begins. Via Nordic Issuing AB's website, it will also be possible to subscribe for units.

Advisors
In connection with the Rights Issue, Carbiotix has engaged Sedermera Corporate Finance AB as financial advisor, Markets & Corporate Law Nordic AB as legal advisor and Nordic Issuing AB as issuing agent.

For further information about the Rights Issue, please contact:
Sedermera Corporate Finance AB
Phone: +46 (0)40 615 14 10
E-mail: cf@sedermera.se
www.sedermera.se

For more information about the Company, please contact:
Erik Deaner, CEO
Phone: +46 (0)73-867 30 85
E-mail: erik.deaner@carbiotix.com

Important information
This press release does not constitute an offer to acquire, subscribe for or otherwise trade in shares, warrants, subscription rights, BTUs or other securities in Carbiotix 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, BTUs 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, BTUs 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, forwardlooking 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 Spotlight Stock Market.

This is information that Carbiotix AB is obliged to make public according to the EU Market Abuse Regulation (MAR). The information was made publicly available by the Company’s contact person set out above on 7 December 2023.

About Carbiotix
Carbiotix AB (CRBX) (www.carbiotix.com) is an award-winning biotechnology company pioneering microbiome healthcare through a portfolio of prebiotic modulators and diagnostic testing services.