TARGOVAX ASA - SUCCESSFULLY COMPLETED PRIVATE PLACEMENT

Friday, June 09, 2017

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN, OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.

Oslo, 8 June 2017: Reference is made to the stock exchange announcement release by Targovax ASA ("Targovax" or the "Company") earlier today regarding the contemplated private placement of new shares in the Company.

The Board of Directors of Targovax is pleased to announce that the private placement has been successfully completed, raising NOK 200 million in gross proceeds through the allocation of 10,000,000 new shares (the "New Shares") at a price of NOK 20 per share (the "Private Placement"). The Private Placement took place through an accelerated bookbuilding process after close of market on 8 June 2017. The Private Placement attracted strong interest from both existing shareholders as well as new high quality investors.

The net proceeds from the Private Placement will be used to finance five additional data read-outs from clinical trials through 2018, in addition to the three planned data-read outs in H2 2017, and selective CMC development in preparation for future pivotal clinical studies.

Completion of the Private Placement is subject to (i) the resolution by the extraordinary general meeting of the Company to be held on or around 30 June 2017 (the "EGM") to issue the new shares in the Private Placement and the subsequent repair offering, (ii) the registration of the share capital increase pertaining to the issuance of the New Shares in the Norwegian Register of Business Enterprises, and (iii) the Norwegian Financial Supervisory Authority approving a combined prospectus for the listing of the New Shares and the subsequent repair offering. Following registration of the share capital increase pertaining to the Private Placement, the Company will have a share capital of NOK 5,219,971.90, divided into 52,199,719 shares, each with a nominal value of NOK 0.10.

Payment date for the Private Placement is expected to be on or about 3 July 2017 and the New Shares are expected to be delivered to the applicant's VPS account on or about 6 July 2017 and tradeable on the Oslo Stock Exchange from that date.

The share issuance is carried out as a private placement in order to complete the transaction in today's market conditions in an efficient manner and to allow for participation from new investors. As a consequence of the private placement structure, the shareholders' preferential rights were deviated from. In the Board of Directors' assessment on whether the pre-emption rights should be deviated from, the following factors were amongst others taken into consideration:

●   The Company will carry out a subsequent repair offering to ensure that existing shareholders who were not allocated shares in the Private Placement are given the opportunity to subscribe for shares on the same terms as the investors in the Private Placement.

●   The Private Placement constitutes less than 24% of the issued and outstanding shares in the Company.

●   The Private Placement was completed after a pre-sounding with potential investors on a confidential basis and publicly announced bookbuilding process managed by two investment banks. The achieved share price does express the market price for relevant amount of shares in the Company.

●   The shares in the Company are also frequently traded on the Oslo Stock Exchange, so shares will be available in the market for shareholders whose ownership percentage are diluted by the Private Placement and who do not wish to be diluted.

●   The number of institutional and specialist investors in the Company will be increased through the Private Placement and the Company will thus achieve a strengthened shareholder base.

Subject to completion of the Private Placement, the Board of Directors intend for the Company to carry out a subsequent repair offering of up to NOK 40 million in which shareholders in the Company as of 8 June 2017, as registered in the VPS on 12 June 2017, who were not allocated New Shares in the Private Placement and who are not resident in a jurisdiction where such offering would be unlawful, or would (in jurisdictions other than Norway) require any prospectus filing, registration or similar action, will receive subscription rights. The subscription rights will be listed and over-subscription and subscription without subscription rights will be allowed in the subsequent repair offering. The subscription price in the repair offering will be the same as in the Private Placement, i.e. NOK 20 per share.

The following shareholders that are represented on the Board of Directors of the Company have been allocated New Shares in the Private Placement at the subscription price of NOK 20 per New Share:

●   HealthCap VL.P., represented on the Board of Directors by Per Samuelsson and Johan Christenson: 1,250,000 New Shares. After the transaction, HealthCap will own 12,405,584 shares.

●   Norwegian Radium Hospital Research Foundation, represented on the Board of Directors by Jónas Einarsson and Bente-Lill Romøren: 350,000 New Shares. After the transaction, Norwegian Radium Hospital Research Foundation will own 4,427,255 shares.

For further information, please contact:

Erik Digman Wiklund, CFO

Phone: +47 413 33 536

Email: erik.wiklund@targovax.com

Arming the patient's immune system to fight cancer.

Targovax is a clinical stage company focused on developing and commercializing novel immuno-oncology therapies to target, primarily, treatment-resistant solid tumors. Immuno-oncology is currently one of the fastest growing therapeutic fields in medicine.

The Company's development pipeline is based on two novel proprietary platforms:

The first platform, ONCOS, uses oncolytic viruses, an emerging class of biological therapy. ONCOS exclusively uses an adenovirus that has been engineered to be an immune activator that selectively target cancer cells. In phase I it has shown to immune activate at lesional level which was associated with clinical benefit. We expect proof of concept data for this platform in 2017 from a clinical trial of lead product ONCOS-102 in patients with refractory malignant melanoma.

The second platform, TG peptides (TG), solely targets tumors that express mutated forms of the RAS protein. Mutations to this protein are common in many cancers and are known to drive aggressive disease progression and treatment resistance. There is a high unmet medical need for therapies that are effective against tumors that express these mutations. The TG platform's therapeutic potential stems from its ability to enable a patient's immune system to identify and then destroy tumors bearing any RAS mutations. In early 2017, key proof of concept data for the TG platform from a clinical trial of TG01 in resected pancreatic cancer patients showed encouraging overall survival and will give guidance for the future clinical development of this platform.

Targovax's development pipeline has three novel therapeutic candidates in clinical development covering six indications.

Both platforms are protected by an extensive portfolio of IP and know-how and have the potential to yield multiple product candidates in a cost-effective manner. Additionally, we have other products in early stages of development.

In July 2016, the Company listed its shares on Oslo Axess. In March 2017, the shares were upgraded to Oslo Børs, the main Oslo Stock Exchange.

IMPORTANT NOTICE:

This announcement is not and does not form a part of any offer for sale of securities.

Copies of this announcement are not being made and may not be distributed or sent into the United States, Australia, Canada, Japan or any other jurisdiction in which such distribution would be unlawful or would require registration or other measures.

The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and accordingly may not be offered or sold in the United States absent registration or an exemption from the registration requirements of the Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any part of the offering in the United States or to conduct a public offering of securities in the United States. Any offering of the securities referred to in this announcement will be made by means of a prospectus.

This announcement is not a prospectus for the purposes of Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the "Prospectus Directive"). Investors should not subscribe for any securities referred to in this announcement except on the basis of information contained in the aforementioned prospectus. In any EEA Member State other than Norway that has implemented the Prospectus Directive, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State.

This communication is only being distributed to and is only directed at persons in the United Kingdom that are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") or (ii) high net worth entities, and other persons to whom this announcement may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.

The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice.

This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.