The Board of Directors of Episurf has resolved on an issue of Class B shares and convertibles as part of the consideration for the acquisition of property assets

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO AUSTRALIA, BELARUS, CANADA, HONG KONG, ISRAEL, JAPAN, NEW ZEALAND, RUSSIA, SINGAPORE, SOUTH AFRICA, SOUTH KOREA, SWITZERLAND, THE UNITED KINGDOM, THE UNITED STATES OR ANY OTHER JURISDICTION WHERE SUCH PUBLICATION, DISTRIBUTION OR DISCLOSURE WOULD BE IN VIOLATION OF APPLICABLE LAWS OR REQUIRE ADDITIONAL REGISTRATION OR ANY OTHER MEASURES. PLEASE REFER TO THE SECTION "IMPORTANT INFORMATION" AT THE END OF THIS PRESS RELEASE. 

The Board of Directors of Episurf Medical AB (publ) ("Episurf" or the "Company") has, on 31 August 2026, as part of the Company's strategy to build a Nordic property platform with a focus on cash flow and return, completed an acquisition of a property portfolio comprising 45 properties from Fastighetsaktiebolaget Lilium (the "Lilium Acquisition") and an additional acquisition of four properties from Setune Assets AB (the "Setune Acquisition" and, together with the Lilium Acquisition, the "Acquisitions"). In connection with the Acquisitions, the Board of Directors has today, on [31] [August] 2026, by virtue of the authorisation granted by the Company's Annual General Meeting held on 25 May 2026, resolved on an issue of Class B shares and convertibles to Fastighetsaktiebolaget Lilium and an issue of Class B shares to Setune Assets AB. 

On 22 May 2026, it was announced that Episurf had entered into an agreement with Fastighetsaktiebolaget Lilium regarding the acquisition of a property portfolio comprising 45 properties, with an agreed property value of MSEK 660. On 29 May 2026, Episurf further announced that the Company had entered into an agreement with Setune Assets AB regarding the acquisition of a property portfolio comprising four properties, with an agreed property value of MSEK 285.5. The closing of the acquisition of both property portfolios takes place on 31 August 2026, in accordance with what has previously been communicated.1 

Since the original share purchase agreements regarding the Acquisitions were entered into, the Company has entered into supplemental agreements pursuant to which the Company has transferred certain rights and obligations under the Acquisitions to wholly-owned subsidiaries. Episurf remains jointly and severally liable together with each respective subsidiary for all obligations under the acquisition agreements. Pursuant to the supplemental agreement regarding the Lilium Acquisition, the cash portion of the preliminary purchase price has been reduced by MSEK 30 and the nominal amount of a convertible note has been increased correspondingly, from approximately MSEK 198 to approximately MSEK 228. 

As part of the payment of the consideration to be paid for the Lilium Acquisition, the Board of Directors of Episurf has, on the date of this press release, by virtue of the authorisation granted by the Company's Annual General Meeting held on 25 May 2026, resolved to issue 3,303,407,120 Class B shares, at a subscription price of SEK 0.08 per Class B share, to Fastighetsaktiebolaget Lilium by way of off-setting a promissory note corresponding to approximately MSEK 264 (the "Share Issue"). As an additional part of the payment of the consideration to be paid for the Lilium Acquisition, the Board of Directors of Episurf has also issued a promissory note amounting to approximately MSEK 228 to be off-set against convertibles convertible into Class B shares in Episurf (the "Convertibles"). The Board of Directors of Episurf has, on the date of this press release, by virtue of the authorisation granted by the Company's Annual General Meeting held on 25 May 2026, resolved to issue the Convertibles to Fastighetsaktiebolaget Lilium (the "Convertible Issue", and, together with the Share Issue, the "Lilium Issues"). 

The Convertibles have a maturity of 24 months from and including the date of the registration with the Swedish Companies Registration Office, and bear an interest rate of 5 per cent per annum. Fastighetsaktiebolaget Lilium is entitled to convert all or part of the loan amount into Class B shares at the following conversion prices: SEK 0.085 per Class B share (months 1-6 from registration), SEK 0.090 per Class B share (months 7-18 from registration) and SEK 0.095 per Class B share (months 19-24 from registration). Upon full conversion at the lowest conversion price, a maximum of 2,684,757,967 new Class B shares may be issued. 

As part of the payment of the consideration to be paid for the Setune Acquisition, the Board of Directors of Episurf has, on the date of this press release, by virtue of the authorisation granted by the Company's Annual General Meeting held on 25 May 2026, further resolved to issue 1,000,000,000 Class B shares, at a subscription price of SEK 0.10 per Class B share, to Setune Assets AB, by way of off-setting a promissory note of SEK 100,000,000 (the "Setune Issue" and, together with the Lilium Issues, the "Issues"). 

The reason for the deviation from the shareholders' preferential rights in connection with the Issues is to enable the fulfilment of the Company's previously announced commitments as a result of the Acquisitions. 

Through the Issues, the number of shares in Episurf will increase by 4,303,407,120 Class B shares, from a total of 10,688,429,393 shares to 14,991,836,513 shares, and the number of votes in Episurf will increase by 4,303,407,120, from 10,689,376,107 to 14,992,783,227. The Company's share capital will increase by SEK 43,034,071.20, from SEK 106,884,293.93 to SEK 149,918,365.13. For existing shareholders, this entails a dilution effect of approximately 28.71 per cent of the share capital and approximately 28.70 per cent of the votes in the Company. 

Upon the issue of Class B shares and conversion of all Convertibles now issued into Class B shares, the number of shares in Episurf will increase by 6,988,165,087 Class B shares, from a total of 10,688,429,393 shares to 17,676,594,480 shares, and the number of votes in Episurf will increase by 6,988,165,087, from 10,689,376,107 to 17,677,541,194. The Company's share capital will increase by SEK 69,881,650.87, from SEK 106,884,293.93 to SEK 176,765,944.80. For existing shareholders, this entails a dilution effect upon full conversion of approximately 39.53 per cent of the share capital as well as the votes in the Company following such conversion. 

An exemption document in accordance with Article 1.5, first paragraph, ba and Annex IX of Regulation (EU) 2017/1129 of the European Parliament and of the Council regarding the admission to trading of the newly issued Class B shares in Episurf Medical AB on Nasdaq Stockholm will be registered with the Swedish Financial Supervisory Authority and published on Episurf's website (www.episurf.com) prior to the admission to trading on Nasdaq Stockholm of the newly issued Class B shares. 

Advisors 

Roschier Advokatbyrå AB is acting as legal advisor to Episurf in connection with the Issues. 

For further information, please contact: 

Jens Andersson, CEO, Episurf Medical 

Tel: +46 (0) 768 55 67 02 

Email: jens.andersson@episurf.se 

The information was submitted for publication, through the agency of the contact person set out above, at 11:55 CEST on 31 August 2026. 

About Episurf Medical AB 

Episurf Medical is a property company with exposure to a diversified portfolio of property assets. The Company's objective is to create value growth through the acquisition and management of Nordic properties. The Company also has a medical technology business based on the individualised Episealer® implant and associated surgical instruments, which are used to treat cartilage damage in joints. Episurf Medical's head office is located in Stockholm, Sweden.  

THIS PRESS RELEASE HAS BEEN PUBLISHED IN SWEDISH AND IN ENGLISH. IN THE EVENT OF ANY DISCREPANCIES BETWEEN THE LANGUAGE VERSIONS, THE SWEDISH VERSION SHALL PREVAIL. 

Important information 

The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to legal restrictions, and persons in jurisdictions where this press release has been published or distributed should inform themselves about and comply with such legal restrictions. The recipient of this press release is responsible for using this press release, and the information contained herein, in accordance with applicable rules in each jurisdiction. This press release does not constitute an offer, or a solicitation of an offer to sell or a solicitation of an offer to purchase or subscribe for securities issued by the Company in any jurisdiction where such an offer or solicitation would be in violation of applicable rules or require additional registration or other measures. 

This announcement is not a prospectus, information memorandum or exemption document for the purposes of Regulation (EU) 2017/1129 (the "Prospectus Regulation") and has not been approved by any regulatory authority in any jurisdiction. 

This press release does not constitute an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be sold in the United States absent registration or an exemption from registration under the US Securities Act of 1933 (the "Securities Act"), as amended, and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States. The information in this press release may not be announced, published, copied, reproduced or distributed, directly or indirectly, in whole or in part, within or into, Australia, Belarus, Canada, Hong Kong, Israel, Japan, New Zealand, Russia, Singapore, South Africa, South Korea, Switzerland, the United Kingdom, the United States or in any other jurisdiction where such announcement, publication or distribution of the information would not comply with applicable laws and regulations or where such actions are subject to legal restrictions or would require additional registration or other measures than what is required under Swedish law. Actions taken in violation of this instruction may constitute a crime against applicable securities laws and regulations. 

This press release does not identify, or purport to identify, the risks (direct or indirect) that may be associated with an investment in the Company. Any information in this press release is provided solely to describe the background to the Issues and does not claim to be complete or exhaustive. No assurance shall be given with regard to the information in this press release nor to its accuracy or completeness. 

This press release does not constitute a recommendation for any investors' decisions regarding the Issues or Episurf. Each investor or prospective investor should conduct his, her or its own investigation, analysis and evaluation of the business and information described in this press release and all publicly available information. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. Neither the contents of the Company's website nor any other website accessible through hyperlinks on the Company's website are incorporated into or form part of this press release, unless expressly stated otherwise. 

In the United Kingdom, this document and other materials relating to the securities referred to herein are distributed and directed only to, and an investment or investment activity related to this document is only available to and will only be available to, "qualified investors" (as defined in paragraph 15 of Schedule 1 to the Public Offers and Admissions to Trading Regulations 2024) who are (i) persons who have professional experience in matters relating to investments and who fall within the definition of "professional investors" in Article 19(5) of the UK Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); or (ii) high net worth individuals referred to in Article 49(2)(a)-(d) of the Order (all such persons are collectively referred to as "relevant persons"). Any investment or investment action referred to in this announcement is only available to relevant persons in the United Kingdom and will only be carried out with relevant persons. Persons who are not relevant persons should not take any action based on this press release, nor should they act or rely on it. 

Forward-looking statements 

This press release contains forward-looking statements that relate to the Company's intentions, assessments or expectations regarding the Company's future results, financial position, liquidity, development, prospects, expected growth, strategies and opportunities and the markets in which the Company operates. Forward-looking statements are statements that do not refer to historical facts and can be identified through statements which includes, but is not limited to, terms such as "consider", "expects", "anticipates", "intends", "appreciates", "will", "can", "assumes", "should", "could" and, in any case, negations thereof, or similar expressions. The forward-looking statements in this press release are based on various assumptions, which in many cases are based on additional assumptions. Although the Company considers that the assumptions reflected in these forward-looking statements are reasonable, it cannot be guaranteed that the assumptions will occur or that they are correct. Since these assumptions are based on assumptions or estimates and are subject to risks and uncertainties, the actual result or outcome may, for many different reasons, differ materially from the forward-looking statements. Such risks, uncertainties, eventualities and other significant factors may cause actual events to deviate significantly from the expectations expressly or implicitly stated in this press release through the forward-looking statements. 

The Company does not guarantee that the assumptions underlying the forward-looking statements in this press release are correct and each recipient of this press release should not unduly rely on the forward-looking statements in this press release. The information, perceptions and forward-looking statements expressly or implicitly set forth herein are provided only as of the date of this press release and may change. Neither the Company nor anyone else undertakes to review, update, confirm or publicly announce any revision of any forward-looking statement to reflect events or circumstances that occur relating to the content of this press release.