SCHEDULE: AEON Biopharma Stakeholders Report Dilution Below 1%

Daewoong Co., Ltd. and Daewoong Pharmaceutical Co. Ltd. report their beneficial ownership in AEON Biopharma, Inc. has fallen below 1% due to recent dilution and a reverse stock split.

Summary

• Reporting persons, Daewoong Co., Ltd. (DWC) and Daewoong Pharmaceutical Co. Ltd. (DWP), filed an Amendment No. 1 to their Schedule 13D.
• The amendment reports that beneficial ownership of AEON Biopharma, Inc. common stock decreased to less than 1% as of March 21, 2025.
• This decrease is attributed to dilution from a public offering completed by AEON Biopharma on January 7, 2025, and a 1-for-72 reverse stock split on February 24, 2025.
• DWC beneficially owns 91,357 shares, representing 0.9% of the class.
• DWP beneficially owns 33,334 shares, representing 0.3% of the class.
• The percentages are based on 10,532,802 shares outstanding as of March 21, 2025.
• No transactions in AEON Biopharma securities were made by the reporting persons between July 28, 2023, and March 24, 2025.
• DWP holds convertible notes ($5.0 million and $10.0 million) and entered into an Exchange Agreement on December 15, 2025, to convert these notes into approximately 23.1 million shares, a new $1.5 million convertible note, and warrants for 8 million shares, subject to stockholder approval.

Sentiment

Score: 4

Explanation: StockSavvy.ai views this filing as moderately negative for the reporting persons due to significant dilution, but it also highlights ongoing strategic investment and potential future capital for AEON Biopharma through the Exchange Agreement.

Positives

• The Exchange Agreement, if approved, could significantly increase DWP's equity stake and provide additional financing to AEON Biopharma through the new convertible note and warrants.

Negatives

• Beneficial ownership of DWC and DWP in AEON Biopharma, Inc. has decreased to below 1% (0.9% for DWC, 0.3% for DWP) due to dilution from a public offering and a reverse stock split.
• The significant dilution indicates a substantial increase in the number of outstanding shares, which typically puts downward pressure on per-share value.

Risks

• The consummation of the Exchange Agreement, which would convert DWP's convertible notes into equity and new notes/warrants, is subject to the approval of AEON Biopharma's stockholders.

Future Outlook

The Issuer expects to hold a stockholder meeting on January 21, 2026, to approve the Exchange Agreement, which, if approved, will convert DWP's existing convertible notes into a significant equity stake, a new convertible note, and warrants. The new convertible note will automatically convert into equity upon a Qualified Financing of at least $30.0 million.

Industry Context

StockSavvy.ai notes that dilution from public offerings and reverse stock splits are common events for biopharma companies, especially those in development stages, as they frequently raise capital to fund research, clinical trials, and operations. The strategic exchange of convertible notes for equity and new financing instruments by a significant investor like Daewoong suggests a continued commitment to AEON Biopharma, albeit with a restructured investment profile. This type of restructuring can be a mechanism to provide ongoing financial support while managing ownership thresholds.

Comparison to Industry Standards

• NA

Related Party Transactions

• DWP (a subsidiary of DWC) acquired senior secured convertible notes from AEON Biopharma and AEON Biopharma Sub, Inc.
• DWP entered into an Exchange Agreement with AEON Biopharma and AEON Sub to convert existing convertible notes into equity, a new convertible note, and warrants.

Stakeholder Impact

• Shareholders (AEON Biopharma): Existing shareholders experienced dilution from a public offering and a reverse stock split. The proposed Exchange Agreement, if approved, could further dilute existing shareholders but also provides a pathway for significant capital infusion and continued strategic partnership.
• DWP/DWC: Their beneficial ownership percentage has decreased, but they are poised to significantly increase their equity stake and maintain a strategic financial relationship with AEON Biopharma through the Exchange Agreement.

Next Steps

• AEON Biopharma's stockholders are expected to vote on the Exchange Agreement at a meeting anticipated on January 21, 2026.
• Upon completion of a Qualified Financing (at least $30.0 million), the New Convertible Note held by DWP will automatically convert into shares of Common Stock or Pre-Funded Warrants.

Key Dates

Recommendation

While the dilution and reverse stock split are negative indicators, the ongoing strategic investment by Daewoong through the convertible notes and the proposed Exchange Agreement suggests a long-term commitment and potential for future value creation. The outcome of the stockholder vote on the Exchange Agreement and future capital raises will be critical determinants of the company's trajectory, warranting a 'hold' position for now.

Keywords

AEON Biopharma, Schedule 13D/A, Beneficial Ownership, Dilution, Reverse Stock Split, Convertible Notes, Public Offering, Daewoong, Biopharma, SEC Filing