Form 4: Athyrium Funds Increase Stake in Biora Therapeutics Through Convertible Note Interest

Athyrium Opportunities funds and related entities acquired additional convertible notes in Biora Therapeutics as payment-in-kind interest, increasing their beneficial ownership.

Summary

• Athyrium Opportunities III Co-Invest 1 LP and Athyrium Opportunities III Acquisition LP received convertible senior secured notes from Biora Therapeutics as payment-in-kind interest.
• The notes were issued on December 12, 2024, but are effective as of December 1, 2024.
• Athyrium Opportunities III Co-Invest 1 LP received $907,023.39 in notes, with $408,163.08 having priority for cash payments.
• Athyrium Opportunities III Acquisition LP received $288,970.50 in notes, with $130,034.19 having priority for cash payments.
• The convertible notes are due in 2028 and have an interest rate of 11.00% / 13.00%.
• The notes are convertible into 158,058 shares of common stock.
• The total value of the notes acquired is $1,195,993.89.
• The total value of the underlying common stock is $19,595,899.89.
• Multiple Athyrium entities and individuals are listed as reporting persons due to their relationships with the funds.

Sentiment

Score: 6

Explanation: The document reflects a routine financial transaction. While it increases Athyrium's stake, it also increases Biora's debt and potential dilution. The sentiment is neutral to slightly positive due to the continued support from a major investor.

Positives

• Athyrium's increased investment demonstrates continued support for Biora Therapeutics.
• The payment-in-kind interest structure allows Biora to conserve cash.

Negatives

• The issuance of convertible notes increases Biora's debt and potential dilution of existing shareholders.

Risks

• The conversion of the notes could dilute existing shareholders.
• Biora's ability to repay the debt is dependent on future performance.

Future Outlook

The document does not contain any specific forward-looking statements or guidance.

Industry Context

This transaction is typical for companies that are raising capital and using convertible debt as a financing mechanism. It is common for investment funds to receive payment-in-kind interest in the form of convertible notes.

Comparison to Industry Standards

• Convertible debt is a common financing tool for biotech companies, especially those in the development stage like Biora Therapeutics.
• The interest rate of 11.00% / 13.00% is within the typical range for convertible notes issued by similar companies.
• The conversion price of the notes will be a key factor in determining the impact on existing shareholders, and this is not disclosed in this document.
• Other biotech companies such as XOMA Corporation and Agenus Inc. have used similar convertible debt structures to raise capital.

Stakeholder Impact

• Shareholders may experience dilution if the convertible notes are converted to common stock.
• Creditors may be impacted by the increased debt load of the company.

Key Dates

Keywords

Convertible Notes, Athyrium, Biora Therapeutics, Payment-in-Kind, Debt, Beneficial Ownership, Senior Secured Notes