SCHEDULE: Exicure HiTron Amends 13D: Board Changes, Share Pledge

Exicure HiTron Inc. updated its beneficial ownership filing, detailing board resignations and appointments, and the pledging of 1.6 million Exicure, Inc. shares as collateral for convertible bonds.

Summary

• Exicure HiTron Inc. (the "Reporting Person") filed Amendment No. 2 to its Schedule 13D regarding its beneficial ownership of Exicure, Inc. (the "Issuer").
• The Reporting Person beneficially owns 3,333,333 shares of Exicure, Inc. Common Stock, representing approximately 52.8% of the outstanding shares.
• This percentage is based on 6,317,793 shares of Common Stock reported as outstanding on August 5, 2025.
• On September 8, 2025, four board members (Ho Jung John, Chang Keun Choi, Sangwook Song, and Minwoo Kang) resigned from the Issuer Board.
• Following nominations by the Reporting Person, Sangjin Yeo and Aejin Hwang were appointed to the Issuer Board, maintaining a majority of the board composed of the Reporting Person's nominees.
• On September 18, 2025, the Reporting Person entered into Share Pledge Agreements with Sangsangin Plus Savings Bank Co., Ltd. and Sangsangin Investment & Securities Co., Ltd. (the "Creditors").
• These Pledge Agreements secure obligations related to the Reporting Person's issuance of convertible bonds in a private placement to the Creditors.
• A total of 1,600,000 shares of Exicure, Inc. Common Stock were pledged as security under these agreements.
• Voting rights and rights to receive dividends for the pledged shares remain with the Reporting Person unless an event of default occurs.

Sentiment

Score: 4

Explanation: The sentiment is slightly negative for Exicure, Inc. shareholders due to the pledging of a significant block of shares (approximately 25.3% of total outstanding) by the majority shareholder. While the majority shareholder maintains board control, the share pledge introduces a potential overhang risk if the majority shareholder defaults on its convertible bond obligations, which could lead to a forced sale of these shares.

Positives

• Exicure HiTron Inc. continues to maintain majority control of Exicure, Inc.'s Board of Directors through its nominees, ensuring strategic alignment.

Negatives

• Exicure HiTron Inc. pledged 1,600,000 shares of Exicure, Inc. common stock as security for its convertible bond obligations, representing a significant portion of its holdings and approximately 25.3% of Exicure, Inc.'s total outstanding shares.
• An event of default on the convertible bonds could lead to the Creditors enforcing their security rights, potentially resulting in a large block of Exicure, Inc. shares being sold.

Risks

• Potential for an event of default under the Share Pledge Agreements, which could allow creditors to exercise rights over the 1,600,000 pledged shares.
• The enforcement of security rights by creditors could lead to a significant number of Exicure, Inc. shares entering the market, potentially impacting share price and stability.

Future Outlook

The filing primarily details past events related to beneficial ownership and corporate governance. It does not provide specific forward-looking statements or guidance for Exicure, Inc.'s operational or financial performance. However, the share pledge by the majority shareholder introduces a future financial obligation and potential risk related to the stability of a significant block of shares.

Industry Context

This filing is specific to changes in beneficial ownership and corporate governance for Exicure, Inc. and the financial activities of its majority shareholder, Exicure HiTron Inc. It does not provide information to analyze broader industry trends or competitive landscape.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders of Exicure, Inc. face potential risk from the pledging of 1,600,000 shares by the majority shareholder, as an event of default could lead to a large block of shares being sold.
• Creditors (Sangsangin Plus Savings Bank Co., Ltd. and Sangsangin Investment & Securities Co., Ltd.) gain security over 1,600,000 shares of Exicure, Inc. Common Stock in connection with the convertible bonds issued by Exicure HiTron Inc.

Key Dates

Recommendation

The filing details significant changes in board composition and the pledging of a substantial block of shares by the majority shareholder. While the majority shareholder maintains control, the share pledge introduces a potential overhang risk for Exicure, Inc.'s stock if the majority shareholder defaults on its convertible bond obligations. This information is material but does not provide sufficient operational or financial data for Exicure, Inc. itself to warrant a strong buy or sell recommendation at this time. Investors should monitor the situation for any further developments regarding the pledged shares and the financial health of Exicure HiTron Inc.

Keywords

Exicure, HiTron, Schedule 13D, beneficial ownership, board changes, share pledge, convertible bonds, corporate governance, equity stake