aibioOS Therapies sells up to $10,000,000 of senior secured convertible notes
Tickers OSTX
The first closing on August 10, 2026 covered $5,000,000 of units, including a bridge note conversion, and the second tranche is optional for each purchaser.
Key facts
- Company
- OS Therapies Incorporated (AMEX: OSTX)
- News type
- Debt Financing
- Primary source
- SEC Form 8-K
OS Therapies Incorporated, a Delaware corporation based in Grasonville, Maryland, entered into a securities purchase agreement on August 10, 2026 with purchasers the Form 8-K does not name. The private placement covers senior secured convertible promissory notes in an aggregate subscription amount of up to $10,000,000, sold in two tranches of up to $5,000,000 each. Each note carries an original issue discount of 7.5%. The 8-K names no counsel.
The exclusive placement agent is Ceros Financial Services, Inc., under an agreement dated August 6, 2026. The company agreed to pay Ceros a cash fee of 5.0% of the subscription amount in each tranche and a non-accountable expense fee of $60,000 at the initial closing. It also issued Ceros warrants for 75,000 shares at $3.14 a share. RockTov SLC LLC is the collateral agent under a Pledge and Security Agreement dated August 10, 2026.
The first closing
Each $100,000 unit contains a note with a principal amount of $108,108.11, 30,000 shares of common stock or pre-funded warrants for the same number of shares, and five-year warrants for up to 30,000 shares. At the initial closing on August 10, 2026, purchasers bought $5,000,000 of units, including a bridge note conversion. The company issued notes with aggregate principal of $5,405,405.42, 600,000 shares, pre-funded warrants for 900,000 shares and warrants for 1,500,000 shares. A $2,200,000 bridge note issued on August 2, 2026 converted into a note of $2,378,378.38 and warrants for 660,000 shares each. The company intends to use the proceeds for clinical development, regulatory activities and working capital. Funding of the second tranche is entirely optional for each purchaser.
Terms of the notes
The notes bear interest at 9.0% a year, payable monthly. A holder is entitled to a minimum of one full year of interest on the original principal even if the note is converted or repaid earlier. Each tranche matures nine months after funding. A holder may convert at $2.05 per share, subject to adjustment, starting 90 days after funding. The company may prepay by paying 110% of principal, accrued interest and other amounts due.
On an event of default, obligations may be accelerated and increased to 125%. Interest then runs at the lesser of 24% a year or the legal maximum, and the company owes a monthly monitoring fee of $10,000. The notes are secured by a first-priority interest in substantially all of the assets of the company and its subsidiaries, excluding intellectual property. The company's UK subsidiary also assigned its VAT refunds and research and development tax relief claims due from HM Revenue & Customs to the collateral agent. The company must use 100% of such refunds to prepay the notes.
Warrants issued at the first closing have an exercise price of $2.85 and run through August 10, 2031. Purchasers get participation rights for 18 months and a most-favored-nation clause.
The business and its finances
OS Therapies calls itself a clinical-stage company focused on osteosarcoma. Its lead candidate is OST-HER2. The 10-K says the Phase IIb trial, which enrolled 41 patients, met its primary endpoint with statistical significance, and that 75% of treated patients (27 of 36 evaluable patients) reached two-year overall survival, against 40% in historical control patients. The comparison is with historical controls, not a concurrent randomized group, so it does not establish the drug's effect. No product has been approved. The 10-K, filed March 31, 2026, said the company expected to submit the clinical module of its Biologics License Application after a Type B meeting with the FDA in the second quarter of 2026. The 8-K does not say whether that happened.
Research and development expense was $16.4 million in 2025, against $2.8 million in 2024. The net loss was $28.8 million in 2025, against $8.9 million in 2024. Cash used in operations was $14.2 million in 2025, against $7.3 million in 2024.
The company raised $5,000,000 at the first closing against $14.2 million used in operations in 2025, with a second tranche that investors may decline. The notes, warrants and shares add to the share count, and the nine-month maturity and pledged tax refunds leave little room to raise money on other terms.