DGAP-Adhoc: PAION AG STARTS CAPITAL INCREASE WITH SUBSCRIPTION RIGHTS THROUGH THE ISSUE OF 18.5 MILLION SHARES AT EUR 2.50 PER SHARE

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| Source: EQS Group AG
PAION AG  / Key word(s): Capital Increase

18.06.2014 14:30

Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted
by DGAP - a company of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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NOT FOR DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN OR INTO THE
UNITED STATES, CANADA, JAPAN, AUSTRALIA OR ANY OTHER JURISDICTION IN WHICH
THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.

AD-HOC ANNOUNCEMENT ACCORDING TO §15 WPHG

PAION AG STARTS CAPITAL INCREASE WITH SUBSCRIPTION RIGHTS THROUGH THE ISSUE
OF 18.5 MILLION SHARES AT EUR 2.50 PER SHARE

  - PAION AG to issue 18.5 million shares at EUR 2.50 per share in capital
    increase with subscription rights

  - Subscription ratio 5:3

  - Subscription period from 20 June to 4 July 2014

  - Subscription trading period from 20 June to 2 July 2014

  - Subsequently all new shares that are not subscribed for shall be placed
    with institutional investors by way of an accelerated bookbuilt
    offering

Aachen (Germany), 18 June 2014 - The Specialty Pharma Company PAION AG
(ISIN DE000A0B65S3; Frankfurt Stock Exchange Prime Standard: PA8) has today
decided with the approval of the Supervisory Board to increase the
Company's registered share capital pursuant to the Annual General Meeting
resolution dated 21 May 2014 by cash contributions granting subscription
rights for existing shareholders from EUR 30,842,178.00 by up to EUR
18,505,305.00 to up to EUR 49,347,483.00 through the issue of up to
18,505,305 new no par value bearer shares, each with a notional value of
the Company's share capital of EUR1.00 per share. The new shares will be
issued at a minimum share price (Ausgabebetrag) of EUR1.00 per share. The
new shares carry full dividend rights from January 1, 2014.

The Close Brothers Bank AG, Frankfurt commits to offer the New Shares for
sale to the existing shareholders of the Company at a subscription ratio of
5:3 (indirect subscription right). That is five old shares entitle the
shareholder to subscribe for three new shares. The subscription price is
EUR 2.50 per share. Shareholders may subscribe to the new shares during the
subscription period in the rights offering, which is expected to begin on
20 June 2014 at 00:00 midnight CEST and end on 04 July 2014 at 24:00
midnight CEST. The subscription rights to the New Shares (ISIN DE000A11QL38
/ A11 QL3) are expected to be traded during the period from 20 June 2014 up
to and including 02 July 2014 in XETRA trading on the Frankfurt Stock
Exchange under the ticker symbol PA8B.

All new shares that are not subscribed for shall be placed with
institutional investors by way of an accelerated bookbuilt offering.

For further details of the capital increase with subscription rights please
see the prospectus, which will be published after approval by the German
Federal Agency for Financial Services Supervision (BaFin) and prior to the
start of the subscription period, and the subscription offer provisionally
planned to be published in the Federal Gazette on 20 June 2014, and each
also available on the PAION website (capital.paion.com).

The net proceeds from the offering shall be used primarily for the further
development of Remimazolam in the US and the EU. For the completion of the
Phase III programs PAION currently anticipates, subject to further
consultations with the regulatory authorities, costs in the amount of
approximately EUR 20-25 million for the US and approximately EUR 15-20
million for the EU. Remaining proceeds from the capital increase in the
amount of approximately EUR 5-10 million could be invested in premarketing
activities.
In this transaction, Close Brothers Seydler Bank AG (Germany) act as the
Sole Global Coordinator and Bookrunner. Blättchen Financial Advisory GmbH
acts as advisor to PAION on the transaction.

###

About PAION
PAION AG is a publicly-listed Specialty Pharma Company headquartered in
Aachen, Germany with a second site in Cambridge, UK. The company has a
track record in developing hospital-based treatments for which there is
substantial unmet medical need. PAION AG is transforming its business model
from a pure development company to a specialty pharmaceutical company with
a focus on anaesthesia products to take advantage of the unique profile of
its main compound, Remimazolam.

Contact
Ralf Penner
Director Investor Relations / Public Relations
PAION AG
Martinstrasse 10-12
52062 Aachen - Germany
Phone: +49 241 4453-152
E-mail: r.penner@paion.com
www.paion.com 

Disclaimer:

This release contains certain forward-looking statements concerning the
future business of PAION AG. These forward-looking statements contained
herein are based on the current expectations, estimates and projections of
PAION AG's management as of the date of this release. They are subject to a
number of assumptions and involve known and unknown risks, uncertainties
and other factors. Should actual conditions differ from the Company's
assumptions, actual results and actions may differ materially from any
future results and developments expressed or implied by such
forward-looking statements. Considering the risks, uncertainties and other
factors involved, recipients should not rely unreasonably upon these
forward-looking statements. PAION AG has no obligation to periodically
update any such forward-looking statements to reflect future events or
developments.

This release does not constitute an offer of securities for sale or a
solicitation of an offer to purchase securities of PAION AG in the United
States, Germany or any other jurisdiction. Neither this announcement nor
anything contained herein shall form the basis of, or be relied upon in
connection with, any offer or commitment whatsoever in any jurisdiction.
The offer will be made exclusively by and on the basis of a securities
prospectus that will be published following approval by the German
Financial Supervisory Authority (Bundesanstalt für
Finanzdienstleistungsaufsicht). It is anticipated that this prospectus will
be published on PAION AG's website and that free-of-charge copies will,
inter alia, be made available at the premises of PAION AG (Martinstrasse
10-12, 52062 Aachen, tel.: +49 241 4453-0). The securities of PAION AG may
not be offered or sold in the United States absent registration or an
exemption from registration under the U.S. Securities Act of 1933, as
amended (the "Securities Act"). The securities of PAION AG have not been,
and will not be, registered under the Securities Act.

In the United Kingdom, this document is only being distributed to and is
only directed at persons who (i) are 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) are
persons falling within Article 49(2)(a) to (d) of the Order (high net worth
companies, unincorporated associations, etc.) (all such persons together
being referred to as "Relevant Persons"). This document is directed only at
Relevant Persons and must not be acted on or relied on by persons who are
not Relevant Persons. Any investment or investment activity to which this
document relates is available only to Relevant Persons and will be engaged
in only with Relevant Persons.


18.06.2014 DGAP's Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de

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Language:     English
Company:      PAION AG
              Martinstr. 10-12
              52062 Aachen
              Germany
Phone:        +49 (0)241-4453-0
Fax:          +49 (0)241-4453-100
E-mail:       info@paion.com
Internet:     www.paion.com
ISIN:         DE000A0B65S3
WKN:          A0B65S
Listed:       Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
              in Berlin, Düsseldorf, Hamburg, München, Stuttgart
 
End of Announcement                             DGAP News-Service
 
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