X4 Pharmaceuticals, Inc. has entered into a senior secured term loan facility with K2 HealthVentures LLC. The agreement, signed on October 7, 2026, provides the company with access to up to $150 million in capital.
The facility consists of two tranches. On the closing date, X4 received a first tranche of $80 million. The company used these funds to repay all outstanding obligations under its previous loan and security agreement with Hercules Capital, Inc., which included approximately $75 million in principal and related fees. The remaining proceeds are intended for working capital and general corporate purposes.
An additional $70 million in term loans is available at the Borrowers' request, subject to approval by K2 HealthVentures and other conditions. Proceeds from this second tranche may be used for permitted acquisitions and investments.
The loan agreement includes specific terms regarding interest and repayment. The term loans bear cash interest at a variable annual rate equal to the greater of 8.55% or the prime rate plus 1.55%. Additionally, the loans accrue paid-in-kind interest at a fixed rate of 1.0% per annum. Interest-only payments are due through October 1, 2029, with the maturity date set for October 1, 2030.
The loan is secured by substantially all of the Borrowers' assets, excluding intellectual property. It includes financial covenants that require the company to maintain unrestricted cash and cash equivalents of at least 75% of outstanding obligations when its market capitalization is below $800 million. Additionally, the company must achieve trailing three-month net product revenue of at least 50% of board-approved projections beginning April 1, 2029.
K2 HealthVentures has the option to convert up to $15 million of the principal amount into shares of X4 common stock at a conversion price of $3.2341 per share, subject to certain limitations.
