Altimmune draws $15.0 million under Hercules loan agreement for up to $100.0 million

Altimmune, Inc. (Nasdaq: ALT) signed a Loan and Security Agreement on May 13, 2025 with Hercules Capital, Inc. that makes up to $100.0 million in term loans available, and drew the first $15.0 million at closing. The company disclosed the loan agreement in a Form 8-K filed May 13, 2025. Further tranches depend on milestones, other conditions or lender approval.

The tranches

The agreement provides up to four tranches of term loans, in an aggregate principal amount of $100.0 million. The first tranche, $15.0 million, was made on the closing date. After the company meets certain milestones and other conditions, the second tranche will be available in an amount of up to $25.0 million and the third in an amount of up to $15.0 million. The fourth tranche, up to $45.0 million, requires the approval of the lenders.

The company's first quarter press release gives the timing. It says the additional $25 million is available in 2025 at Altimmune's option, subject to clinical and financial milestones. The remaining $60 million is available beginning in 2026.

Interest, fees and repayment

The term loan matures on June 1, 2029. Interest is the greater of two figures: the prime rate reported in The Wall Street Journal plus 2.45%, or 9.95% until December 31, 2025 and 9.45% after that.

The agreement carries an end of term charge of 6.25% of the funded loan amount, due at prepayment or maturity. Altimmune also pays a facility charge of 1.0% of each tranche when it is funded, and a prepayment charge on certain voluntary prepayments that decreases over time.

The loan runs for 48 months. Payments are interest-only for up to 24 months from closing, a period that can extend up to 42 months if milestones are met. After that, the company repays principal and interest in equal monthly installments until maturity.

Covenants and collateral

The loan is secured by a security interest in substantially all of the assets of Altimmune and of its subsidiaries that are co-borrowers or guarantors. The agreement limits indebtedness, liens, investments, distributions including dividends, mergers or acquisitions and other corporate actions. It also requires the company to keep a minimum level of cash, cash equivalents and liquid funds starting April 1, 2026.

If an event of default occurs, such as a payment default or a breach of a covenant after any cure period, Hercules and the lenders can accelerate the loan and foreclose on the collateral. The company says it will file the full agreement with its first quarter 2025 Form 10-Q.

The company's cash and results

The press release reports cash, cash equivalents and short-term investments of $150 million as of March 31, 2025. For the three months ended that day, research and development expenses were $15.8 million, general and administrative expenses were $6.0 million and the net loss was $19.6 million, or $0.26 per share.

Altimmune describes itself as a late clinical-stage biopharmaceutical company developing peptide-based therapeutics for liver and cardiometabolic diseases. Its lead program, pemvidutide, is in the IMPACT Phase 2b trial in MASH, with top-line data expected in the second quarter of 2025. The company says 212 participants were randomized. Its chief executive said that achieving statistical significance on MASH resolution and fibrosis improvement at 24 weeks would position pemvidutide as best-in-class, which means the trial has yet to show it. The 10-K describes the company's 48-week MOMENTUM Phase 2 obesity trial, announced on November 30, 2023, as enrolling 391 subjects.

Who is involved

Chief Financial Officer Gregory Weaver signed the 8-K. Vipin K. Garg, Ph.D., President and Chief Executive Officer, is quoted in the press release. Hercules Capital, Inc. and the lenders party to the agreement provide the loan. The 8-K and press release name no financial advisor or counsel on either side.

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