N.B. The English text is an in-house translation of the original Swedish text. Should there be any disparities between the Swedish and the English text, the Swedish text shall prevail.

The resolution requires approval at an Extraordinary General Meeting, which will be held on May 15, 2019. The notice of the Extraordinary General Meeting will be published in a separate press release.

Summary

• Existing shareholders are entitled to subscribe for one (1) subscription right for each share held on the record date of 21 May 2019, regardless of share class. One (1) subscription right entitles the holder to subscribe for one (1) newly issued share of class B.
• The Rights Issue consist of a maximum of 19,181,302 new shares of class B and are offered at a subscription price of SEK 2.90 per share, which means that the Company will receive SEK 55.6 million before issuing costs, if the Rights Issue is fully subscribed.
• The Rights Issue is guaranteed up to 80 percent by subscriptions and underwriting commitments.
• The subscription period for subscription of shares will be from May 23, 2019 until June 7, 2019.
• To enable allocation to subscribers who may not receive allocation in the Rights Issue and to potentially broaden and strengthen the Company"s ownership base, the Board proposes authorization for the Board of Directors to decide on an over-allotment issue amounting to SEK 5.0 million, if fully exercised.
• To finance repayment and termination of the previous outstanding convertible loan and to secure the short-term working capital requirement, the Company has entered into agreement regarding a short-term bridge loan of SEK 12 million. The bridge loan is intended to be repaid with proceeds received from the Rights Issue.
• The Company carries out the Rights Issue to finance preparations for the Phase 2 study, to initiate pre-clinical studies with the newly acquired drug substance and to repay short-term loans.

The Bridge Loan

In connection with the Rights Issue, the Company entered into an agreement with Formue Nord Markedsneutral A/S regarding a bridge loan of SEK 12 million. The Bridge Loan enabled full repayment and termination of the previous outstanding convertible loan issued by the European High Growth Securities Opportunities Fund ("EHGOSF"). The Bridge Loan also ensures the short-term working capital requirement.

The cost of the Bridge Loan corresponds to a monthly interest rate of 2.5 percent per initiated 30-day period. The Bridge Loan is intended to be repaid with cash received from the Rights Issue.

Background and rational in summary

Cereno Scientific develops drugs that restore the body"s own defense system against thrombosis to be used in the prevention of thrombosis-related complications to cardiovascular disease in the global market.

In June 2018 the Company received positive results from the Phase 1 study with its drug candidate CS1 and is ready to continue the clinical development with a phase 2 study, planned to begin in H1 2020. The overall purpose of the upcoming Phase 2 study is to validate its therapeutic effect and tolerance of CS1. In addition to CS1, Cereno Scientific has signed an agreement with Emeriti Bio AB regarding an acquisition of the substance EB014 in order to broaden Cereno Scientific"s portfolio in cardiovascular diseases.

During March 2018, Cereno Scientific entered into an agreement regarding a financing solution with the European High Growth Opportunities Securitization Fund, EHGOSF, for the purpose of obtaining working capital and to finance the clinical development of CS1. On March 1, 2019, Cereno Scientific terminated the agreement.

The Company’s proposed financing is the present Rights Issue, including the Bridge Loan, which is considered to be the alternative creating the right conditions for the Company´s operations and long-term shareholder value.

Cereno Scientific intends to use the total proceeds raised for the following purposes, specified in order of priority:

• Repayment of the Bridge Loan used to finance the Company’s operations after the previously mentioned financing solution was terminated.
• Complete the planning work and to submit the application for the Phase 2 study during Q3 2019 to the authorities in order to obtain approval for the study during Q1 2020.
• Scale the production of the clinical trial drug CS1 to be used in the Phase 2 study.
• After approval, initiate the Phase 2 study during H1 2020.
• Initiate preclinical studies on new drug substance in collaboration with Emeriti Bio.
• Continuing the development of the Company’s patent portfolio.
• Finance operating costs.

The Company intends to use the proceeds that might be raised from the over-allotment issue to the following:

• Accelerate Phase 2 study initiation.

The Rights Issue

The Board of Cereno Scientific has resolved to issue shares with preferential rights for the Company"s existing shareholders in accordance with the terms listed below. The decision is conditional on the following extraordinary general meeting´s subsequent approval, and that the extraordinary general meeting resolves to amend the Company"s Articles of Association regarding the number of shares and share capital.

• All existing shareholders receive one (1) subscription right for each share, regardless of share class, held on the record date, May 21, 2019. One (1) subscription right entitles the holder to subscribe for one (1) newly issued share for a subscription price of SEK 2.90.
• The Rights Issue entails the issue of a maximum of 19,181,302 shares of series B. At full subscription of the Rights Issue, the Company receives proceeds amounting to approximately SEK 55,6 million, before issuing costs. As a result, the share capital may increase from SEK 1,918,130.20 to SEK 3,836,260.40, representing an increase of SEK 1,918,130.20.
• The subscription period will be from May 23, 2019 up and until June 7, 2019.
• Existing shareholders who choose not to participate in the Rights Issue will experience a dilution amounting to 50 percent, if the Rights Issue is fully subscribed.

Subscription commitments and guarantees

The Rights Issue is partially secured through subscription commitments of approximately 6.6 percent and through underwriting commitments of approximately 73.4 percent. In total, 80 percent of the Rights Issue is secured by subscription and underwriting commitments. Subscription commitments have been provided by Björn Dahlöf privately and via company (Board Member and CMO), Jonas Faijerson Säljö via company (Board member and Head of Intellectual Property Rights), Sverker Jern (Board member), Anders Svensson (Board member), Niklas Bergh via company (Board deputy and CSO), Sten R. Sörensen via company (CEO), Jan-Peter Idström (Senior Director Development) and GU Ventures AB. The underwriting commitments have been provided by external parties. For the underwriters, an underwriting compensation of ten (10) percent of the underwritten amount is paid in cash. The underwriters may also choose to receive compensation in shares instead of cash, in which case the compensation is twelve (12) percent. No compensation is paid to the shareholders who entered into subscription commitments.

Proposal for amendment of the Articles of Association

At the Extraordinary General Meeting, the Board also proposes to decide on the Articles of Association to be amended regarding the share capital limits and the number of outstanding shares limits by adjusting the share capital to a minimum of SEK 1,900,000 and a maximum of SEK 7,600,000 and the number of shares to a minimum of SEK 19,000,000 and a maximum of 76,000,000. Amendment of the Articles of Association is a prerequisite for the Rights Issue.

Proposal for authorization for the Board to decide on over-allotment issue

To enable allocation to subscribers who may not receive allocation in the Rights Issue and to potentially broaden and strengthen the Company"s ownership base, the Board proposes the Board of Directors to be authorized to issue an additional maximum of 1,724,137 shares of class B to be issued by an over-allotment issue at the same subscription price as the shares issued in the Rights Issue. Upon full utilization of the over-allotment issue, the Company will receive an additional SEK 5.0 million. The over-allotment issue is conditional on a fully subscribed Rights Issue and will, if fully utilized, increases the share capital by an additional SEK 172,413.70 to SEK 4,008,674.10. The over-allotment issue would entail an additional dilution of 4.3 percent, resulting in dilution totaling 52.2 percent for a shareholder who does not subscribe in the Rights Issue upon capitalization of the entire over-allotment.

Timetable

Advisors 

Mangold Fondkommission AB is acting as financial adviser to the Company in the Rights Issue. Advokatfirman MAQS is acting as the legal adviser to the Company.

For further information, please contact:
Sten R. Sörensen – CEO
Tel: +46 733 74 03 74
E-mail: sten.sorensen@cerenoscientific.com
www.cerenoscientific.se

About Cereno Scientific AB 
Cereno Scientific is developing a novel preventive medicine to treat thrombosis-related disease, based on the body’s own intelligent clot-busting system. Cardiovascular disease is currently the leading cause of death worldwide. Current therapies are connected to an increased risk of bleeding and, as a result, low effectiveness due to lower dosing levels. In turn, this leads to a high risk of new blood clots. Cereno Scientific’s drug candidate, CS1, is expected to provide a possibility for an effective prevention of thrombosis and a lower risk for serious bleeding complications than with current blood thinning therapies. CS1 is an innovative controlled release formulation of a known compound, and as such is expected to have a relatively short development time. The Gothenburg-based company is located in AstraZeneca’s BioVenture Hub and is supported by GU Ventures. Cereno Scientific’s B share has been listed on Spotlight Stock market since June 2016 with the ticker CRNO B, ISIN SE0008241558.

This information is such that Cereno Scientific AB is required to make public in accordance with the EU’s Market Abuse Regulation (MAR). The information was made public by the Company’s contact person above on April 12, 2019.

Important information

This press release is not an offer to subscribe for shares in Cereno Scientific and investors should not subscribe or acquire any securities. Invitation to concerned persons to subscribe for shares in Cereno Scientific will only be made through the prospectus that Cereno Scientific is expected to publish on May 20, 2019.

This press release shall not, directly or indirectly, be released, published or distributed in or to the United States, Australia Japan, Canada, New Zealand, Hong Kong, South Africa or other country where such action as a whole or in part is subject to legal restrictions.

Neither subscription rights, shares subscribed for ("BTA") or newly issued shares have been recommended or approved by any US federal or state securities authority or regulatory authority. No subscription rights, BTA or newly issued shares have been registered or will be registered under the United States Securities Act of 1933, as applicable, or in accordance with applicable laws in the United States, Australia, Hong Kong, Japan, Canada, New Zealand, Switzerland, Singapore, South Africa or in any other country where the Rights Issue or distribution of the press release is in violation of applicable laws or regulations or presupposes that a further prospectus is established, registered or that any other measure is undertaken beyond that required by Swedish law.

There is no intention to register any portion of the offer in the United States and the securities issued in the Rights Issue will not be offered to the public in the United States.

This press release may contain certain forward-looking information that reflects Cereno Scientific"s current views on future events as well as financial and operational development. Words that are "intended", "come", "judged", "expected", "can", "plan", "appreciate" and other expressions that imply indications or predictions about future developments or trends, constitute forward-looking information. Forward-looking information is inherently associated with both known and unknown risks and uncertainties because it depends on future events and circumstances. Forward-looking information does not constitute a guarantee of future performance or development and actual outcomes may differ substantially from what is stated in forward-looking information. This information, the opinions and the forward-looking statements contained in this press release are valid only on this date and may be amended without notice. Cereno Scientific makes no representations about publishing updates or revisions of forward-looking information, future events or similar circumstances other than the applicable law.