Form 4: Nantahala Capital Management and Directors Boost Stake in Aytu BioPharma with Significant Warrant Acquisition

Nantahala Capital Management, along with directors Wilmot B. Harkey and Daniel Mack, reported the acquisition of 4 million prefunded warrants in Aytu BioPharma, Inc., signaling increased beneficial ownership.

Summary

• Nantahala Capital Management, LLC, a 10% owner and director, along with directors Wilmot B. Harkey and Daniel Mack, reported changes in their beneficial ownership of Aytu BioPharma, Inc. (AYTU) securities.
• On June 6, 2025, the reporting persons acquired 4,000,000 prefunded warrants.
• These prefunded warrants are exercisable to purchase Issuer Common Stock at an exercise price of $0.0001 per share.
• The reported price of the derivative security (prefunded warrants) was $1.4999.
• Following this transaction, the reporting persons beneficially own 4,815,217 derivative securities.
• The ownership is indirect, held by certain private funds and managed accounts advised by Nantahala Capital Management, LLC.
• The prefunded warrants do not expire until exercised in full, subject to certain limits on beneficial ownership.

Sentiment

Score: 8

Explanation: The acquisition of a significant number of prefunded warrants by a 10% owner and directors indicates strong insider confidence and a positive outlook for the company's future, despite the technical nature of the filing.

Positives

• Significant acquisition of 4,000,000 prefunded warrants by a 10% owner and directors, indicating strong insider confidence in Aytu BioPharma's future prospects.
• The prefunded warrants have a very low exercise price of $0.0001 per share, suggesting a favorable entry point for the underlying common stock.
• The warrants do not expire until fully exercised, providing long-term flexibility for the holders.

Future Outlook

The acquisition of prefunded warrants with a low exercise price and no expiration date suggests a long-term bullish outlook by Nantahala Capital Management and the associated directors on Aytu BioPharma's future stock performance.

Management Comments

• Nantahala Capital Management, LLC ('NCM'), an investment adviser to certain private funds and managed accounts (the 'NCM Investors') that hold the Aytu BioPharma, Inc ('Issuer') securities disclosed in this Form 4, may be deemed a beneficial owner of such securities.
• Each of Mr. Wilmot B Harkey and Mr. Daniel Mack may be deemed a beneficial owner of Issuer securities beneficially owned by NCM.
• Each of NCM, Mr. Harkey and Mr. Mack disclaims beneficial ownership of the Issuer's securities disclosed herein except to the extent of their respective pecuniary interests therein.

Industry Context

This transaction occurs within the biopharmaceutical industry, where capital raises and strategic investments are common for funding research, development, and commercialization efforts. Insider purchases, especially by significant shareholders and directors, can be interpreted as a positive signal regarding a company's prospects within its competitive landscape.

Related Party Transactions

• The transaction involves Nantahala Capital Management, LLC, a 10% owner and entity associated with directors Wilmot B. Harkey and Daniel Mack, acquiring securities from the issuer, which constitutes a related party transaction.

Stakeholder Impact

• Shareholders: The transaction is likely to be viewed positively by existing shareholders as it demonstrates significant insider confidence and investment in the company's future, potentially leading to increased investor interest and share price stability.

Next Steps

• Potential future exercise of the prefunded warrants into common stock by the reporting persons.

Key Dates

Recommendation

Keywords

AYTU BioPharma, Nantahala Capital Management, Prefunded Warrants, Insider Trading, Beneficial Ownership, SEC Form 4, Biopharma, Investment, Equity Securities