ChromoGenics conducts a rights issue of units for SEK 68.2 million

The Board of Directors of ChromoGenics AB (”ChromoGenics” or ”the Company”) has today, with support pursuant to the authorization granted by the Annual General Meeting on May 20, 2021, has decided to conduct an issue of units, consisting of shares and warrants of approximately SEK 68.2 million with preferential rights for existing shareholders (”the Rights Issue”). The terms of the  Rights Issue mean that three (3) existing shares give the right to subscribe for one (1) unit, consisting of four (4) shares and four (4) warrants, at a subscription price of SEK 12.00, corresponding to SEK 3.00 SEK per share.  The rights issue is secured to approximately 79 percent through subscription and guarantee commitments and the Board intends to secure the issue to approximately 80 percent through additional subscription and guarantee commitments from senior executives and board members. Upon full exercise of all attached warrants, ChromoGenics may be added a further maximum of approximately SEK 25.6 million before issue costs

Background and motive in summary

ChromoGenics has successfully completed the tuning of the Company's one sputter machine, Sputter I, in the Company's own production facility in Uppsala and can thus offer customers high-quality dynamic glass of guaranteed industrial quality. With this milestone, ChromoGenic's primary focus now shifts to sales and marketing, in addition to the efforts made to increase production capacity and meet future increasing demand. A growing business entails an increased need for capital as increased activity requires, among other things, a larger amount of working capital in the form of input goods and inventories in the production process. The rights issue is carried out with the aim of accelerating ChromoGenic's ability to implement the transition from development companies to industrial companies. An important step in this is to establish the first partnership with a local, external manufacturer, which receives deliveries of ChromoGenic's electrochromic foil which then handles customization and lamination in and deliveries of dynamic glass to the end customer. Fully developed, this business strategy entails a significant opportunity for marginal expansion.

During the second half of 2021, the Company has focused on the implementation and delivery of dynamic glass to Betonmast Oslo AS regarding the Gullhaug Torg 5 project in Oslo, where the Company was responsible for the entire supply chain. In step with successful production and assured quality, ChromoGenics is now meeting a significant interest and demand for the Company's patented electrochromic ConverLight technology for glass applications from both existing and new customers. ChromoGenics initially plans to focus on orders in the range of SEK 1-10 million. In parallel with an influx and delivery of new orders, ChromoGenics, in consultation with customers, plans to continuously carry out re-deliveries of dynamic glass as a replacement for certain previous deliveries, which were made with sputtered foil from a previous subcontractor, identified with certain aesthetic defects. The company takes care of its customer relationships and has a close dialogue with affected customers regarding re-delivery of ordered products and services and assesses that a majority of these customers are potential repeat customers after completed re-deliveries.

ChromoGenics plans to dispose of the issue proceeds, SEK 58.0 million after issue costs, from the Rights Issue for the following purposes:

• Development of delivery concept with partners, SEK 3.0 million,
• Upgrades and efficiencies in the production process in order to increase the production rate, SEK 8.0 million,
• Operating costs and working capital to finance market expansion, SEK 38.0 million
• ISO and EHS certifications, approximately SEK 1.5 million, and
• Complaints, SEK 7.5 million,

Upon full exercise of the warrants attached to the Offer, the Company may be provided with a net payment of a further maximum of approximately SEK 25.0 million. The net proceeds are intended to be used in their entirety for increased market processing and increased production capacity.

Terms of the Rights Issue

The Board of Directors of ChromoGenics decided on February 8, 2022, with the support of an authorization granted by the Annual General Meeting on May 20, 2021, to carry out a rights issue for existing shareholders by issuing a maximum of 5,679,198 units. The right to subscribe for units shall accrue with preferential rights to those who on the record date for the Rights Issue are registered as shareholders in the Company, whereby holding one (1) existing share in the Company entitles to one (1) unit right. Three (3) unit rights entitle to subscribe for one (1) unit consisting of four (4) shares and four (4) warrants of series 2022/2023: 1. In total, the Rights Issue comprises a maximum of 22,716,792 shares and 22,716,792 warrants series 2022/2023: 1. The record date for the right to receive unit rights is 15 February 2022. The subscription price amounts to SEK 12.00 per unit, corresponding to a subscription price of SEK 3.00 per share, and means that ChromoGenics can be added a maximum of approximately SEK 68.2 million before issue costs. The warrants are issued free of charge. Subscription of units with or without preferential rights shall take place during the period 17 February - 3 March 2022. Unit rights that are not exercised during the subscription period become invalid and lose their value. Trading in unit rights will take place on the Nasdaq First North Growth Market during the period 17 - 28 February 2022.

During the period 13 - 27 March 2023, four (4) warrants entitle to subscribe for one (1) new share in ChromoGenics at an exercise price corresponding to seventy (70) percent of the volume-weighted average price paid for ChromoGenic's share on Nasdaq First North Growth Market during the period 21 February - 7 March 2023, however, a minimum of SEK 2.50 and a maximum of SEK 4.50 per share. This means that ChromoGenics, upon full exercise of the warrants, may be added a further maximum of approximately SEK 25.6 million before issue costs.

In the event that all units have not been subscribed for with the support of unit rights, the Board shall, within the framework of the maximum amount of the Rights Issue, decide on the allocation of units subscribed without the support of unit rights. Allocation without preferential rights shall primarily be made to such subscribers who have also subscribed units with the support of unit rights, regardless of whether the subscriber was a shareholder on the record date or not, and in case allocation to these cannot be made in full, allocation shall be made in relation to number of unit rights used for subscription of units and, insofar as this cannot be done, by drawing lots. In the alternative, allocation of units subscribed for without the support of unit rights shall be made to others who have subscribed without the support of unit rights, and in the event that allocation to these cannot be made in full, allocation shall be made in proportion to the number of units each subscribed and , insofar as this cannot be done, by drawing lots. Thirdly and lastly, allotment of units subscribed for without the support of unit rights shall be made to those who have entered into a guarantee undertaking in their capacity as issue guarantors, and in case allotment to these cannot be made in full, allotment shall be made in proportion to the amount and one guaranteed for drawing and, in so far as this cannot be done, by drawing lots.

Complete terms and conditions for the Rights Issue as well as other information about the Company will be stated in the EU growth prospectus which is expected to be published around 16 February 2022.

Subscription commitments and guarantee commitments

In connection with the Rights Issue, the Company has received subscription commitments from a number of existing shareholders totaling approximately SEK 6.6 million, corresponding to approximately 9.7 percent of the Rights Issue. No compensation is paid for these subscription commitments. In addition, ChromoGenics has entered into agreements on issue guarantees with both existing shareholders and external investors for a total of approximately SEK 47.4 million, corresponding to approximately 69.5 percent of the Rights Issue. Subscription commitments received and guarantee commitments thus amount to approximately SEK 54.0 million, corresponding to approximately 79.2 percent of the Rights Issue. The Board intends to secure the issue to approximately 80 percent through additional subscription and guarantee commitments from senior executives and board members. For the issue guarantees, a cash compensation of ten (10) percent of the guaranteed amount is paid or, if the guarantors choose to receive payment in the form of units, twelve (12) percent of the guaranteed amount. Further information regarding the parties that have entered into subscription commitments and guarantee commitments will be available in the prospectus that is planned to be published around 16 February 2022.

Timeline for the Rights Issue

Change of Share Capital and number of shares

Through the Rights Issue, the share capital in the Company increases by a maximum of SEK 4,543,358.40, from SEK 3,407,519.00 to SEK 7,950,877.40, by issuing a maximum of 22,716,792 shares. The number of shares thus increases from 17,037,595 to a maximum of 39,754,387 shares. For existing shareholders who do not participate in the Rights Issue, this means a dilution effect, upon full subscription, of approximately 57.1 percent of the capital and votes in the Company.

In the event that all attached warrants are fully exercised for subscription of new shares in ChromoGenics, the number of shares will increase by a further 5,679,198 to a total of 45,433,585 shares and the share capital will increase by 1,135,839.60 to a total of SEK 9,086,717.00. . The dilution effect, in the event that the Rights Issue and related warrants are fully subscribed, amounts to approximately 62.5 percent.

Advisor

Erik Penser Bank AB and Bird & Bird Advokat are ChromoGenics’ financial and legal advisors, respectively, in conjunction with the Rights Issue.

For more information, please contact:
Fredrik Fränding, CEO         
Tel: +46(0) 72 249 24 62
Lars Ericsson, CFO & Head of Communications
Tel: +46 (0)18 430 0430
E-mail: info@chromogenics.com
ChromoGenics

This information constitutes such information that ChromoGenics AB is obligated to disclose in accordance with the EU Market Abuse Regulation. The information was submitted by the above-mentioned contact persons for publication on February 8, 2022, at 8:25 a.m. CET.

About ChromoGenics
ChromoGenics is a proptech company that produces dynamic glass for real estate. The company’s product ConverLight® Dynamic, controls indoor comfort with high daylight transmission, great view and solar heat blocking and thereby reduces cost of cooling. ConverLight® Dynamic is based on a patented solution where electrochromic coatings are laminated in plastic film and then laminated between glass. The plastic film is easy to transport, so long shipments of bulky glass can be avoided. ChromoGenics also offers static glass, ConverLight® Static, and the ConverLight® Energy facade glass solution. ChromoGenics' stock was listed on Nasdaq First North Growth Market in 2017 and has supplied glass technology to several major real estate companies.

ChromoGenics originates from world-leading research at Ångströmlaboratoriet at Uppsala University. The company's production facility in Uppsala has been partially financed with conditional loans from Energimyndigheten (Energy Authority) in Sweden. ChromoGenics' share (CHRO) is listed on Nasdaq First North Growth Market with Erik Penser Bank as Certified Adviser: certifiedadviser@penser.se

IMPORTANT INFORMATION

This press release is not an offer to subscribe for units in ChromoGenics, and investors should not subscribe or acquire any securities other than on the basis of the information in the prospectus.

This press release may not be released, published or distributed, directly or indirectly, in or to the United States, Australia, Hong Kong, Japan, New Zealand, Switzerland, Singapore, South Africa, or any other jurisdiction where the distribution of this press release would be illegal. This press release also does not constitute an offer to sell new shares, paid subscribed shares or subscription rights to any person in a jurisdiction where it would not be permitted to provide such an offer to such person or where such action would require additional prospectus, registration or other measures than according to Swedish law. The prospectus, the application form and other documents relating to the Rights Issue may not be distributed in or to any country where such distribution or the Rights Issue requires measures specified in the preceding sentence or where they would conflict with rules in such country.

The new shares paid subscribed shares, and subscription rights have not been registered or approved by any US federal or state securities authority or supervisory authority. No new shares, paid subscribed shares, subscription rights or other securities issued by ChromoGenics have been registered or will be registered in accordance with the United States Securities Act 1933 in force at any time or under the securities law of any state in the United States. Therefore, no new shares, paid subscribed shares, subscription rights or other securities issued by the Company may be transferred, exercised or offered for sale in the United States other than in such exceptional cases that do not require registration or through a transaction that is not covered by such registration. There is no intention to register any part 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.

The Company has not accepted any offer to the public regarding the securities referred to in this press release in any other European Economic Area ("EEA") country than Sweden. Therefore, in other EEA Member States, the securities can only be offered to qualified investors.

This press release may only be distributed and directed to "qualified investors" (as defined in section 86 (7) of the Financial Services and Markets Act 2000) in the United Kingdom and which are (i) professional investors covered by Article 19 (5) of Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 ("Order"), or (ii) persons covered by Article 49 (2) (a) to (d) ("High Net Value Companies" etc.) of the Order (commonly referred to as "relevant persons"). In the United Kingdom, such investment or other investment activity referred to in this press release is only available to, and directed only to, relevant persons. Any person who is not a relevant person should not act on the outside or rely on this message or any of its contents.