Eloxx Pharmaceuticals (ELOX) Q4 2025 earnings summary

Executive summary

• Entered into a Sixth Amendment to the Loan and Security Agreement, effective July 10, 2024, among Eloxx Pharmaceuticals, Inc., Zikani Therapeutics, Inc., Eloxx Pharmaceuticals Ltd., Hercules Capital, Inc., and other lenders.

• The amendment reflects the making of a bridge loan on May 31, 2024, and provides for the availability of a Tranche 2 Advance, with updated terms and conditions.

Capital allocation and financing

• The amendment bifurcates the remaining principal of the Tranche 1 Advance into Tranche 1A and Tranche 1B Advances.

• Introduces a Bridge Loan Advance and a Tranche 2 Advance, with the Tranche 2 Lenders advancing $250,000 each on July 5 and July 8, 2024, and the remainder to be advanced by July 12, 2024.

• The aggregate outstanding term loan advances are capped at the maximum term loan amount plus any amount added to principal of the Tranche 1B Advance.

• Interest on the Tranche 1B, Tranche 2, and Bridge Loan Advances can be paid in kind (PIK), increasing the principal balance.

• Principal payments on Tranche 1B, Tranche 2, and Bridge Loan Advances can be deferred monthly at the lenders' election.

• Optional conversion rights allow Tranche 1A and 1B Lenders to convert outstanding obligations into equity at the price per share paid in a qualified financing; mandatory conversion applies to Bridge Loan and Tranche 2 Advances if a qualified financing occurs.

Significant events and developments

• Hercules Capital, Inc. resigned as agent and SD MF 4 LLC was appointed as successor agent under the agreement.

• The amendment includes a release by the loan parties of all claims against the agent and lenders up to the date of the amendment.

• The agreement was updated to reflect the new agent, SD MF 4 LLC, and to transfer all agency rights and collateral interests.