OSLO - May 11, 2023: SoftOx Solutions AS ("SoftOx" or the "Company"), a medtech
and clinical-stage pharmaceutical company based in Oslo, Norway,has secured
financing of approx. NOK 9 million which gives the Company a runway of approx. 6
months within which the Company plans to raise further capital through a
contemplated pre-emptive rights issue towards existing shareholders. 

"This raise of funds, a material change of strategy including a considerable
reduction of burn rate, expected further grants and prepaid assets ready for
sale, is expected to fully finance the company's future product development both
for the military and the civil markets." says Executive Chairman of SoftOx
Solutions AS, Geir Almås.

As stated in previous stock exchange notice, including the announcement made
March 27 and March 23, the Company has over some time been exploring funding
alternatives to secure the Company's operations and liabilities, and that it
would restructure and explore strategic alternatives. This work has now been
further progressed, through the contemplated financing and the restructuring of
the company. The restructuring involves securing key personnel and signing a
Letter of Intent (LOI) with the Department of lmmunology and Microbiology
(ISIM), Faculty of Health and Medical Sciences, University of Copenhagen, who
will now lead the future product development as further described below.

Outsourcing the Company's product development
The two parties state in the LoI that the potential partnership is based on the
highly promising clinical results observed in treatment of chronic wounds, the
proof of concept for treatment of influenza in mice and prevention of Sendai
virus (parainfluenza) in mice, safety and tolerability studies of SoftOx
lnhalation Solution (SIS) and the two parties' partnership in the European
Defense Fund's COUNTERACT consortium. The agreement is conditional upon fully
financing of SoftOx Solutions including payment of debts and sufficient runway. 

"At the University of Copenhagen we find some of the best researchers in the
world within the field of antimicrobial resistance and chronic infections. This
partnership is a big step towards our goal of developing the future solutions
for treatment of virucidal infections in the respiratory tract and infections in
chronic wounds", says Almås.

Together the two parties intend to establish new and innovative solutions based
on the SoftOx technology for fighting antimicrobial resistance and chronic
infections in wounds and together an inhaled broad spectrum of anti-infective
treatment for the respiratory tract.

The two parties state in the LOI:
"The first development project the parties want to move from SoftOx to the
University of Copenhagen is the research and development of medical
countermeasure solutions against biological threats and for civil preparedness
toward the next pandemic. The cost of University of Copenhagen's work packages
will be covered by future payments of grants already awarded by European Defense
Fund and The Norwegian Ministry of Defense."

"SoftOx furthermore intends to outsource its civil product development of the
SoftOx lnhalation Solution for treatment of influenza-like illnesses and
prevention of hospital-acquired pneumonia (HAP) to the University of Copenhagen
to ensure that proof of concept in humans", says Thomas Bjarnsholt, Chief
Scientific Officer at SoftOx Solutions, and professor within bacteriology at the
University of Copenhagen. 

Future projects at University of Copenhagen depends on funding from SoftOx
Solutions AS and will give the investors of SoftOx a great opportunity of
conducting an effect study in humans on its inhalation solution for a much lower
price than originally planned. 

SoftOx will keep the commercial rights and ownership to the technology.

Reducing the burn rate, securing key personnel
The Company has reduced the burn rate in the holding company SoftOx Solutions AS
from approx. NOK 8 million per month to approx. NOK 1 million per month. This
reduction has been achieved through layoffs, closing down our own production
facilities for GMP production and other outsourcing of activities. 

The Company will in the future only retain a small staff to coordinate and lead
the company's product development.

As already mentioned the University of Copenhagen will take over and perform
SoftOx' scientific development under the European Defense Funds Medical Counter
Measurement program. SoftOx Defense Solutions AS will have a core scientific
team paid by funding from already received grants working on the program.

"By doing this our burn rate has decreased significantly and at the same time
securing a strategic collaboration with the University of Copenhagen and
University hospitals, we get the ability to do future product development with
top notch scientific and clinical teams", says Almås.

Divestment or co-fund technology after early proof of concept
Based on a change in strategy, where the Company will develop its products to
the stage of proof of concept in humans, SoftOx Solutions has started a process
to either divest the wound care and the disinfection technology or carve it out
in in separate funded companies with a clear pathway of a well-timed potential
divestment of ownership. 

"We have several leads both within wound care and disinfection, which we will
explore further. The interest is solid, and we are optimistic", says Almås.

Further details regarding first and second round of funding
NOK 9 million is already committed by way of share capital contribution and loan
and the Company is in close dialog with other investors with the aim to increase
the first round of funding to NOK 16 million in total. 80% of the funding will
be in the form of a loan to the group subsidiary Water Innovation AB (WIAB),
which will in turn use the funds to secure the company's intellectual property
and pay back a loan to the holding company. The remaining 20% of the funding
will be by way of a private placement in SoftOx Solutions AS with up to 400.000
new shares to be subscribed at a subscription price of NOK 8 per share. The
loan, which matures on the 31st of January 2024 and will be repaid with an
amount equal to 125% of the loan. The lender will at the time of repayment of
the loan have a warrant to buy share an amount equal to the original loan with
strike NOK 8 per share.  Each lender will also receive a number of warrants
amounting to double the gross proceeds paid by the respective investor in the
first funding round (i.e. share capital and loan amount). These warrants will
expire on the date falling 5 years after the issue. 

In addition to the NOK 9-16 million in the form of equity and loans in the first
funding round, the Board of Directors also expects to propose to the general
meeting that it receives an authorization to increase the share capital of the
Company by way of conversion of up to NOK 5 million in debt to employees and
their companies on to shares with a share price of NOK 8 per share. Each lender
will also receive a number of warrants amounting to double the gross proceeds
paid by the respective investor in the first funding round (i.e. share capital
and loan amount). These warrants will expire on the date falling 5 years after
the issue. 

Gross proceeds of NOK 20 to 50 million
In order to secure a well-planned process for the divestment of technology and
to pay off its accumulated debt, the Company intends to raise NOK 20 to 50
million in a second round of funding. This is expected to be in the form of a
rights issue, but other structures may be considered, depending on market
conditions and investor appetite. Under the condition that the Company in the
second round raise NOK 50 million at NOK 8 per share, today's shareholders will
keep ownership of 63,1% of the total amount of shares in the company after the
conversion of today's convertible loan and the execution of the warrants.

The process planning for securing this financing has started and the Company
expects to conclude this second round of financing at the latest by the end of
the third quarter 2023.

The extraordinary General meeting to approve the share issue, the subscription
rights and the authorisations to the Board of Directors to issue new shares will
be convened in due course. 


For further information, please contact:
Geir Almås, Executive Chairman of SoftOx Solutions AS
Mail: ir@soft-ox.com
Phone: Front Desk: (+47) 948-59-599 or (+47) 977-59-071