CONTROL BIONICS LIMITED — Capital/Financing Update 2023

May 16, 2023

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17 May 2023

NON-RENOUNCEABLE RIGHTS ISSUE OFFER

Control Bionics Limited is pleased to announce that it will be undertaking a pro rata nonrenounceable rights issue ( Offer ) of ordinary fully paid shares to Eligible Shareholders, being persons who are registered as shareholders of the Company on the record date of 22 May 2023 ( Record Date ) and have a registered address in Australia or New Zealand.

The Company is raising capital to fund a specific set of new growth initiatives including the commercialisation of new products such as the recently announced Drove Autonomous Wheelchair Module, regulatory approvals required for export development of new and existing products and acquisition of relevant distribution channels in key export markets.

Shareholders are being offered the opportunity to subscribe for 1 new fully paid ordinary share in the Company (each, a New Share ) for every 3 existing fully paid ordinary shares in the Company (each, a Share ) held at 7pm (Sydney time) on the Record Date at a price of 9.5c per New Share ( Issue Price ).

The Issue Price of 9.5c represents an approximately 9.5% discount to the last closing price on 12 May 2023, and an approximately 29.6% discount to the volume weighted average price of Shares for the 30 days prior to the announcement of the Offer.

If fully subscribed, the Offer will raise up to approximately $2.865 million (before costs).

The Offer is not underwritten.

Shareholders who, at the Record Date, have an address registered in either Australia or New Zealand, will be eligible to participate in the Offer. All other shareholders will not be eligible to participate.

New Shares issued pursuant to the Offer will rank equally with existing fully paid ordinary shares currently on issue and the Company will apply to ASX for official quotation of the New Shares.

Eligible Shareholders may also apply for additional new shares ( Additional New Shares ), being New Shares in excess of their pro rata entitlement under the Offer. The allocation of Additional New Shares and any scale back will be subject to availability of Additional New Shares and will occur in the Company's absolute discretion.

Any New Shares offered under the Rights Issue that are not subscribed for by Eligible Shareholders will form part of the shortfall ( Shortfall ). The Directors reserve the right, subject to the Corporations Act and the Listing Rules, to allocate any Shortfall to Eligible Shareholders that apply for Additional New Shares or otherwise, to place any remaining Shortfall at their discretion within 3 months after the Closing Date (on the same conditions as New Shares and at a price not less than the Issue Price).

Control Bionics Limited

Registered Office: Level 5, Suite 5.01, 697 Burke Road, Camberwell, Vic., 3124 T: +61 3 9897 3576 W: www.controlbionics.com

ABN: 45 115 465 462

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Capital Structure

The capital structure of the Company following completion of the Offer is summarised below:

Shares	100% of entitlements paid up	50% of entitlements paid up
Shares on issue at date of the offer	90,479,028	90,479,028
New shares offered under the offer	30,159,676	15,079,838
Total shares on completion of the offer	120,638,704	105,558,866

Use of Funds

It is intended that the proceeds from the Offer will be used in accordance with the table set out below.

Purpose	Amount $
New product development, production and commercialisation	1,000,000
Software development for export markets	500,000
Regulatory Approvals	500,000
Distribution channel acquisitions	400,000
Working capital and reserve	465,000
TOTAL	2,865,000

Timetable

The Offer is proposed to be conducted according to the following timetable:

Lodgement of Appendix 3B and Cleansing Notice for 17 May 2023 Rights Issue with ASX "Ex" Date (i.e. the date on and from which Shares 19 May 2023 trade on ASX without an Entitlement) Record Date (i.e. the time and date for determining 7pm (Sydney time) on 22 May 2023 Entitlements) Despatch of Offer Booklet and Entitlement and 25 May 2023 Acceptance Form to Eligible Shareholders

Control Bionics Limited

Registered Office: Level 5, Suite 5.01, 697 Burke Road, Camberwell, Vic., 3124

T: +61 3 9897 3576 W: www.controlbionics.com

ABN: 45 115 465 462

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Rights Issue Opening Date	25 May 2023
Last day to extend the offer Closing Date	13 June 2023
Rights Issue Closing Date	5pm (Sydney time) on 16 June 2023
Trading in New Shares on ASX on a "deferred settlement basis" begins	19 June 2023
Announcement of results of Rights Issue	19 June 2023
Issue of New Shares to successful applicants under the Rights Issue	19 June 2023
Trading in New Shares on ASX on a normal ("T+2") settlement basis begins	20 June 2023

All dates (other than the date of lodgement of the Offer Document with ASX) are indicative only. The Company reserves the right, subject to the Corporations Act, the ASX Listing Rules and other applicable laws, to vary the dates of the Offer, including extending the Closing Date or accepting late acceptances, either generally or in particular cases, without notice.

On 25 May 2023, the Company will dispatch an Offer Document together with a personalised Entitlement and Acceptance Form to eligible shareholders. The Entitlement and Acceptance Form together with the appropriate application monies needs to be returned to the Company’s share registry before 7pm (Sydney time) on the anticipated closing date of 16 June 2023.

The Offer Document includes details of the Offer and the risks associated with investing in the Company. It is recommended that you read the Offer Document carefully and, if you are interested in participating in the Offer, consult with your professional advisers.

This announcement is authorised by CBL’s Chairman, Roger Hawke.

About Control Bionics:

Control Bionics is a medical device company assisting patients whose ability to communicate verbally or via text and social media is compromised by illnesses such as Motor Neurone Disease (MND)/ Amyotrophic Lateral Sclerosis (ALS), Spinal Cord Injury, Traumatic Brain Injury and Cerebral Palsy among others. Our core patented NeuroNode technology is a wireless wearable device that detects minute signals sent from the brain to any skeletal muscle and is captured as Electromyography (EMG) signals which are processed on personal computers, smartphones and tablets to generate text, text to speech, email and other computer-controlled functions. Our technology is integrated with eye gaze technology whereby the eye gaze enables a cursor to be moved about a computer screen, driven much like a mouse, and the NeuroNode acts as like the mouse button. Control Bionics produces the only system to harness three modalities – touch, eye movement and EMG control – which combined yield unique benefits in terms of the ability of patients to express themselves with significantly faster speed and less fatigue.

Control Bionics recently extended its offering to mobility with the launch of DROVE – the autonomous wheelchair module. DROVE allows powered users the independence to operate their wheelchairs in their own homes for the first time.

Control Bionics operates in North America, Australia, Singapore and Japan.

Control Bionics Limited

Registered Office: Level 5, Suite 5.01, 697 Burke Road, Camberwell, Vic., 3124 T: +61 3 9897 3576 W: www.controlbionics.com

ABN: 45 115 465 462