Mabion S.A. — Share Issue/Capital Change 2019

Oct 22, 2019

Subject: Agreement reached on the terms and conditions of and a decisionmade to conclude finance documentation with the European Investment Bank

Text of the report:The management board of Mabion S.A. (the"Company" or the "Issuer") hereby announces that on 21 October 2019:

a) it agreed with the European Investment Bank (the "EIB") the terms andconditions of financing related to granting an unsecured loan to theCompany to be provided in three tranches that will be made availablesubject to the satisfaction of specified conditions, up to the aggregateamount of EUR 30 million, following the execution of the appropriatedocumentation, including the finance contract (the "Finance Contract")and an agreement on the issue of subscription warrants to EIB (the"Warrant Agreement");

b) it adopted a resolution on reaching a decision to conclude thefinancing documentation, including the Finance Contract and the WarrantAgreement, on the terms agreed with the EIB.

On the date of this report, the Company's supervisory board issued apositive recommendation to the management board with regard to theadoption of the above-mentioned resolution.

Furthermore, the Company's management board announces that the executionof the Finance Contract and the Warrant Agreement based on the agreedterms and conditions of the financing is planned to occur not later thanon 31 October 2019. In the event that the Finance Contract is not signedby 31 October 2019, the Company will make an announcement to that effectin a separate current report.

I. Key terms of the Finance Contract

The funds will be used to finance investment and research anddevelopment projects, including those related to the development ofbiosimilars and innovative biological medicines in Poland, as well asthe development of the Company's research and development infrastructureand production capacities.

The terms of the Finance Contract will provide that the individualfinancing tranches are to be repaid within five years from the drawdownof a given tranche. The loan availability period will be 36 months fromthe execution date of the Finance Contract. The loan will bear fixedinterest not exceeding 2.7% per annum.

The Finance Contract will contain provisions imposing certainrestrictions on the Issuer regarding activities including the disposaland encumbrance of material assets, the granting of loans andguarantees, as well as the payment of dividends and the undertaking offinancial commitments in excess of the agreed thresholds. If the Companybreaches the commitments set out in the Finance Contract, EIB will beentitled to demand the immediate repayment of the loan.

II. Material terms and conditions of the issue of the subscriptionwarrants and the Warrant Agreement

The disbursement of the financing by EIB will be conditional on, amongother things, the issuance by the Company of series C subscriptionwarrants that will be subscribed for by EIB and will entitle EIB tosubscribe for the series T shares in the Company representing 2.85% ofthe Company's share capital as at the date of the issue. To that end,the Company will convene an extraordinary meeting of the shareholderswithin a short time in order to adopt a resolution on the conditionalincrease of the share capital, the exclusion of the existingshareholders' pre-emptive rights, and the issue of the subscriptionwarrants to EIB.

The issue of the subscription warrants to EIB represents a component ofthe remuneration due to EIB for the provision of the financing, andallows for the current debt service costs to be considerably reduced incomparison to standard lending products made available by financialinstitutions.

The Warrant Agreement provides for the following key terms governing theissue of the subscription warrants and the subscription for the shares:

1. the warrants will be subscribed for by EIB free of charge and willentitle EIB to subscribe for the series T shares in the Company at theissue price of PLN 0.1 per share;

2. the subscription warrants will be freely transferable to EIB'saffiliates and will be transferable to any other person pursuant to apurchase agreement;

3. in the cases specified in the Warrant Agreement in which the share ofthe series T shares in the Company's share capital would fall below2.85%, the Company will be required to issue additional warrants to EIBin a number ensuring that the shares subscribed for based on thewarrants represent 2.85% of the Company's share capital.

The Warrant Agreement will regulate the situations in which the rightsattached to the subscription warrants can be exercised as well as theparties' rights and obligations with regard to the transfer andacquisition of the subscription warrants and the series T shares(including the lock-up restriction in relation to the series T sharesthat applies within 6 months following the taking-up of the series Tshares, subject to the exceptions set out in the Warrant Agreement).