Hepion Pharmaceuticals Enters $500K Convertible Note Financing

What Happened Hepion Pharmaceuticals, Inc. announced on September 3, 2026 that it entered into a convertible note purchase agreement with Gravitas Capital LP and issued a $500,000 secured convertible note plus a warrant to purchase 12,500,000 shares of common stock. The note bears 8% annual interest payable in kind, matures September 3, 2027, and is secured by all of the company’s assets. Conversion of the note and exercise of the warrant are contingent on stockholder approval to increase the company’s authorized shares.

Key Details

• Amount raised: $500,000 via a secured convertible note issued September 3, 2026.
• Interest and term: 8% per year, payable in kind (accrues to principal); maturity date September 3, 2027.
• Conversion and warrants: Note convertible at Gravitas’s option at $0.04 per share (conversion possible on/after Sept 3, 2026 pending stockholder approval) — conversion would equal up to 12,500,000 shares; separate warrant to buy 12,500,000 shares at $0.06 per share exercisable starting on/after Sept 3, 2026 (subject to the same shareholder approval) and expiring Sept 3, 2031.
• Security: Note is secured by all of Hepion’s assets under a convertible note security agreement.

Why It Matters This transaction provides Hepion with immediate non-dilutive cash (debt) but creates potential future dilution if the note is converted and the warrant is exercised — together they could add up to about 25 million shares outstanding if fully converted/exercised. The note’s secured status gives Gravitas priority over other creditors. The interest accrual (paid in kind) increases the effective amount owed over the one-year term unless converted earlier. Importantly, conversion and warrant exercise require shareholder approval to increase authorized shares, so dilution is not automatic and depends on a future vote.