HLB will issue KRW 30 billion worth of private convertible bonds (CB) to secure funding for new drug development and commercialization.

On the 5th, HLB held a board meeting and announced through a regulatory filing that it had resolved to issue KRW 30 billion worth of '44th Unregistered Unsecured Private Convertible Bonds.'

[Fundraising and Usage Plan] The KRW 30 billion raised this time will be entirely allocated to operating funds. The company plans to use KRW 10 billion in 2026 and KRW 20 billion in 2027 for research and development (R&D), clinical trials, and commercialization costs for new drug development.

[CB Issuance and Redemption Terms] The payment date and maturity date of this private CB are August 19, 2026, and August 19, 2029, respectively. The coupon rate has been set at 1.0% per annum, and the yield to maturity at 4.0% per annum.

Bondholders may request early redemption (Put Option) every three months starting from February 19, 2028, which is 18 months after issuance. In such cases, the payment amount will be calculated applying an annual compound interest rate of 4%.

[Conversion Terms and Refixing] The conversion price is set at KRW 33,361. The conversion request period runs from August 19, 2027, to July 19, 2029, and the number of common shares issuable upon conversion is 899,253 shares (0.68% of the total currently issued shares).

Additionally, a refixing (conversion price adjustment) clause has been included as a safeguard against a decline in market price. The initial refixing will take place on March 19, 2027, with subsequent adjustments to the conversion price every seven months thereafter. The minimum adjusted price is KRW 23,353, which represents 70% of the initial conversion price.

[Underwriting and Share Dilution Impact] The underwriters for this issuance are: △BNK Investment Securities KRW 24.5 billion △Cactus Oasis No. 3 Investment Fund KRW 4 billion △Jin Yang-gon KRW 1.5 billion. Notably, a separate call option agreement will be executed for 7% of the volume underwritten by BNK Investment Securities.

Reflecting this CB issuance, HLB's outstanding convertible (exercisable) shares will increase from the existing 6,000,898 shares to 6,901,151 shares. Accordingly, the potential share dilution ratio relative to the total number of issued shares will reach 5.18%.