Gossamer Bio completes early settlement of convertible notes exchange

Gossamer Bio Inc. (NASDAQ: GOSS) completed the early settlement of its exchange offer for 5.00% Convertible Senior Notes due 2027 on June 4, 2026. The company exchanged $181.1 million in aggregate principal amount of existing convertible notes, leaving $18.9 million outstanding.

In the exchange, Gossamer Bio issued $65.2 million in aggregate principal amount of new 7.50% Convertible Senior Secured First Lien Notes due 2030, along with 254.2 million new shares of common stock, 33.4 million prefunded warrants and 135.8 million purchase warrants.

The new convertible notes bear interest at 7.50% per annum and will mature on July 1, 2030, unless earlier converted or repurchased. The notes include a springing maturity date of March 2, 2027 if more than $4 million of existing convertible notes remain outstanding at that time.

The conversion rate for the new notes will initially equal $1,000 divided by a 10% premium to a reference price, which will be determined based on the stock's volume-weighted average price following the final settlement date. The reference price will be the greater of $0.17 or the lower of $0.34 and the seven-day average following final settlement.

Prior to obtaining stockholder approval, the company can only satisfy conversion obligations through cash settlement. The new notes include a minimum liquidity covenant requiring Gossamer Bio to maintain $40 million in liquidity, tested monthly starting with June 2026.

The exchange offer for remaining existing convertible notes will expire at 5:00 p.m. New York time on June 16, 2026, with final settlement expected on June 18, 2026.

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