Akebia Therapeutics Reports New Debt, Equity Sales, and Agreement Changes

TL;DR

**Akebia just took on new debt and sold unregistered stock, signaling big financial moves.**

AI Summary

Akebia Therapeutics, Inc. filed an 8-K on January 30, 2024, reporting events from January 29, 2024, including the entry into and termination of a material definitive agreement, the creation of a direct financial obligation, and unregistered sales of equity securities. This indicates significant financial restructuring and potential dilution for existing shareholders, as new equity was sold without public registration. Investors should be aware of these changes as they could impact the company's financial health and stock value.

Why It Matters

This filing signals major financial and contractual shifts for Akebia, potentially impacting its balance sheet, future obligations, and the value of existing shares due to dilution from unregistered equity sales.

Risk Assessment

Risk Level: high — The combination of new financial obligations and unregistered equity sales suggests significant financial activity that could lead to dilution and increased leverage, posing higher risk for investors.

Analyst Insight

A smart investor would closely monitor Akebia's subsequent filings and investor calls for details on the new financial obligations and the impact of the unregistered equity sales, as these could significantly affect future earnings and share value. Consider the potential for dilution.

Key Numbers

• January 29, 2024 — Date of earliest event reported (when the material events occurred)
• January 30, 2024 — Filing date (when the 8-K was filed with the SEC)

Key Players & Entities

• Akebia Therapeutics, Inc. (company) — the registrant filing the 8-K
• The Nasdaq Capital Market (company) — exchange where Akebia's common stock is registered
• 001-36352 (dollar_amount) — Commission File Number
• 20-8756903 (dollar_amount) — IRS Employer Identification No.

Forward-Looking Statements

• Akebia's stock price (AKBA) will experience increased volatility due to the reported financial restructuring and potential dilution from unregistered equity sales. (AKBA) — medium confidence, target: 2024-02-29
• Akebia Therapeutics will provide more detailed information regarding the 'Material Definitive Agreement' and 'Direct Financial Obligation' in subsequent filings or earnings calls. (Akebia Therapeutics, Inc.) — high confidence, target: 2024-03-31

FAQ

Key Financial Figures

• $0.00001 — ich registered Common Stock, par value $0.00001 per share AKBA The Nasdaq Capital Marke
• $55.0 million — the aggregate principal amount of up to $55.0 million (the "Term Loan Facility"). An initial
• $37.0 million — Loan Facility"). An initial tranche of $37.0 million (the "Initial Loan") was funded under t
• $8.0 million — ditional tranches available as follows: $8.0 million available in a single draw through Dece
• $10.0 million — ber 31, 2024 (the "Tranche B Loan") and $10.0 million available in a single draw through Dece
• $34.5 m — rom the Initial Loan were approximately $34.5 million, after deducting estimated debt i
• $1.30 — tock, at an exercise price per share of $1.30 (subject to standard adjustments for st
• $15,000,000 — fiscal month, greater than or equal to $15,000,000 or (ii) earn consolidated revenue, meas
• $150,000,000 — or the trailing twelve-month period, of $150,000,000. If an event of default occurs and is c

Filing Documents

• akba-20240129.htm (8-K) — 40KB
• 0001517022-24-000014.txt ( ) — 182KB
• akba-20240129.xsd (EX-101.SCH) — 2KB
• akba-20240129_def.xml (EX-101.DEF) — 4KB
• akba-20240129_lab.xml (EX-101.LAB) — 27KB
• akba-20240129_pre.xml (EX-101.PRE) — 14KB
• akba-20240129_htm.xml (XML) — 3KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement Entry into Kreos Term Loan Facility On January 29, 2024 (the "Closing Date"), Akebia Therapeutics, Inc. ("Company" and collectively with any Company affiliates that are made party to the Credit Agreement as a borrower, "Borrower") entered into an Agreement for the Provision of a Loan Facility (the "Credit Agreement") with Kreos Capital VII (UK) Limited ("Kreos" or "Lender Representative"), which are funds and accounts managed by BlackRock, and provides for a senior secured term loan facility in the aggregate principal amount of up to $55.0 million (the "Term Loan Facility"). An initial tranche of $37.0 million (the "Initial Loan") was funded under the Term Loan Facility on the Closing Date. In addition to the Initial Loan, the Term Loan Facility includes additional tranches available as follows: $8.0 million available in a single draw through December 31, 2024 (the "Tranche B Loan") and $10.0 million available in a single draw through December 31, 2024 (the "Tranche C Loan" and, together with the Initial Loan and the Tranche B Loan, the "Term Loans"). Each Term Loan draw is subject to various conditions precedent, including (x) the absence of any defaults or events of default and Borrower's continued compliance with the terms and provisions of the Credit Agreement, (y) in the case of the Tranche B Loan and Tranche C Loan, receipt of marketing approval for vadadustat from the United States Food and Drug Administration ("Vadadustat FDA Approval") and (z) in the case of Tranche C, receipt of a certain amount of cumulative gross cash proceeds after the Closing Date in the form of equity or equity linked securities in one or more series of transactions. The Term Loan Facility has an initial maturity date of March 31, 2025, which shall be automatically extended to January 29, 2028 if Company receives Vadadustat FDA Approval on or prior to June 30, 2024 (the "Maturity Date"). Borrower's net proceeds from the Init

02 Termination of a Material Definitive Agreement

Item 1.02 Termination of a Material Definitive Agreement Termination of Pharmakon Term Loan Facility On November 11, 2019, the Company entered into that certain Loan Agreement (as amended, restated, amended and restated, supplemented or otherwise modified, the "Prior Credit Agreement"), with Biopharma Credit PLC, BPCR Limited Partnership and BioPharma Credit Investments V (Master) LP (together, "Pharmakon" and, together with certain affiliates of Pharmakon, the "Prior Lenders"). In connection with the entry into the Credit Agreement, on the Closing Date the Prior Credit Agreement and the other loan documents associated therewith were terminated, the payment and other obligations of Borrower under the Prior Credit Agreement were paid in full and discharged, and Prior Lenders' security interests in the Company's assets and property were released.

03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

02 Unregistered Sales of Equity Securities

Item 3.02 Unregistered Sales of Equity Securities The information set forth under Item 1.01 with respect to the Warrant is incorporated by reference into this Item 3.02. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AKEBIA THERAPEUTICS, INC. Date: January 30, 2024 By: /s/ John P. Butler Name: John P. Butler Title: President and Chief Executive Officer

View Full Filing

View this 8-K filing on SEC EDGAR