Orchestra BioMed Holdings Inc

Darren Sherman Bonus

The information included in this portion of Part II, Item 5 of this Quarterly Report is provided in lieu of filing such information on a Current Report on Form 8-K under Item 5.02 (Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers).

On November 7, 2024, the Compensation Committee of the Board approved a one-time cash bonus of $150,000 (the “Bonus”) to Darren Sherman, our President and Chief Operating Officer and a director, to be paid on November 15, 2024 in light of Mr. Sherman’s performance and continued contributions to the Company. Pursuant to the terms of the Bonus, Mr. Sherman is required to repay the Bonus as follows in the event of (i) his voluntary resignation without Good Reason, or (ii) the termination of his employment for Cause (as Good Reason and Cause are defined in Mr. Sherman’s January 26, 2023 Orchestra BioMed Holdings, Inc. Amended and Restated Employment Agreement), in either case before May 15, 2026:

The foregoing description of the Bonus does not purport to be complete and is subject to and qualified in its entirety by reference to the full text of the Bonus Letter Agreement, dated November 8, 2024, by and between the Company and Darren Sherman, which is filed as Exhibit 10.2 hereto and is incorporated herein by reference.

2024 Security and Loan Agreement

The information included in this portion of Part II, Item 5 of this Quarterly Report on Form 10-Q is provided in lieu of filing such information on a Current Report on Form 8-K under Item 1.01 (Entry into a Material Definitive Agreement). Item 2.03 (Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant) and Item 3.02 (Unregistered Sales of Equity Securities).

On November 6, 2024 (the “Closing Date”), the Company and certain of its subsidiaries (together with the Company, the “Borrower”) entered into a Loan and Security Agreement (the “2024 LSA”), by and among the Borrower, the several banks and other financial institutions or entities party thereto, as lenders (collectively, the “Lenders”), and Hercules Capital, Inc., as administrative agent and collateral agent for itself and the Lenders.

**Amount.**The 2024 LSA provides a secured term loan facility of up to $50.0 million (collectively, the “Term Loans”), consisting of:

(a)An initial tranche of Term Loans in an aggregate amount of $15.0 million, which was funded on the Closing Date.

(b)Subject to the terms and conditions of the 2024 LSA, an additional tranche of Term Loans in an aggregate amount of up to $7.5 million, which will be available beginning on the Financing Milestone I Date (as defined in the 2024 LSA) and continuing through the earlier to occur of (A) the date that is 120 days from the Financing Milestone I Date and (B) April 30, 2026 (Tranche 2-A Advances”).

(c)Subject to the terms and conditions of this Agreement, any time beginning on the Performance Milestone Date (as defined in the 2024 LSA) and continuing through the earlier to occur of (A) the date that is 120 days from the Performance Milestone Date and (B) September 30, 2026, the Borrower may request and the Lenders shall severally (and not jointly) make up to three additional advances in minimum increments of $5,000,000 (or if less, the remaining amount of advances available to be drawn) in an aggregate principal amount up to the difference of $15,000,000 minus the aggregate original principal amount of all Tranche 2-A Advances made by the Lenders.

(d)Subject to the terms and conditions of this Agreement, Borrower may request and Lenders shall severally (and not jointly) make, on or prior to the Amortization Date (as defined in the 2024 LSA) but only following and conditioned on the approval by the Lender’s investment committee in its sole and unfettered discretion, in each case, one or more additional Term Loan advances in minimum increments of $5,000,000 (or if less, the remaining amount of Term Loan advances available to be drawn pursuant to this provision in an aggregate principal amount up to $20,000,000.

Interest Rate. Borrowings under the 2024 LSA bear interest at a per annum rate equal to the greater of (i) (x) the Prime Rate (as reported inThe Wall Street Journal) plus (y) 2.0%, and (ii) 9.50%.

Terms of Repayment and Facility Charges. The Term Loans are repayable in monthly interest-only payments until: (i) December 1, 2026 or (ii) June 1, 2027, if the Financing Milestone I Date has occurred on or prior to November 6, 2026; or (iii) December 1, 2027, if the Performance Milestone Date has occurred on or prior to May 6, 2027. After the expiration of the interest-only payment period, the Term Loans are repayable in equal monthly payments of principal and accrued interest until maturity. The Term Loans will mature on November 6, 2028.

At the Company’s option, the Company may prepay all or a portion of the outstanding Term Loans, subject to a prepayment premium equal to (a) 3.0% of the Term Loans being prepaid if the prepayment occurs during the twelve months following the Closing Date, (b) 2.0% of the Term Loans being prepaid if the prepayment occurs after 12 months following the Closing Date but on or prior to 24 months following the Closing Date, and (c) 1.0% of the Term Loans being prepaid if the prepayment occurs after 24 months following the Closing Date and prior to the maturity date. In addition, the Company will pay an end of term charge of 6.35% upon the prepayment or repayment of the Term Loans and a facility charge of 0.75% upon any draws of the Term Loans.

**Covenants, Representations and Warranties, Events of Default.**The 2024 LSA includes customary affirmative and negative covenants and representations and warranties, including a covenant against the occurrence of a “change in control,” financial reporting obligations, and certain limitations on indebtedness, liens, investments, distributions (including dividends), collateral, transfers, mergers or acquisitions, taxes, corporate changes, and bank accounts. The 2024 LSA also includes customary events of default, including payment defaults, breaches of covenants following any applicable cure period, the occurrence of certain events that could reasonably be expected to have a “material adverse effect” as set forth in the 2024 LSA, cross acceleration to third-party indebtedness and certain events relating to bankruptcy or insolvency. Upon the occurrence of an event of default, Hercules may declare all outstanding obligations immediately due and payable and take such other actions as set forth in the 2024 LSA.

Beginning on the Testing Effective Date (as defined in the 2024 LSA), the Company must maintain Qualified Cash (as defined in the 2024 LSA) in an amount greater than or equal to (x) the outstanding principal amount of the Term Loan advances, multiplied by (y) (1) prior to December 1, 2025, 35% or (2) on and after December 1, 2025, (A) if the Performance Milestone Date has not occurred on or prior to December 1, 2025, 50% until the date on which the Performance Milestone Date has occurred and (B) on and after the Performance Milestone Date, 35% (the “Minimum Cash Covenant”). The Minimum Cash Covenant will be waived if the Company’s Market Capitalization (as defined in the 2024 LSA) exceeds $500.0 million.

**Security.**The Term Loans are secured by a lien on substantially all of the assets of the Company.

**Right to Invest.**While the Term Loans remain outstanding, the Lenders shall have the right to participate in any equity financing of the Company of at least $10,000,000 in an aggregate amount of up to $5,000,000 on the same terms, conditions and pricing afforded to others participating in any such equity financing.

**Warrants.**In connection with the entry into the 2024 LSA, on the Closing Date, the Company issued each of the Lenders a warrant to purchase the Company’s common stock (each a “Warrant” and, collectively, the “Warrants”). Pursuant to the terms of the Warrants, each Lender may purchase that number of shares of Company Common Stock equal to (i)(x) 0.02, multiplied by (y) the aggregate principal amount of all Term Loan Advances (as defined in the 2024 LSA) made to the Company by the applicable Lender, divided by (ii) $5.74, which is the Exercise Price of the Warrants. Each Warrant is exercisable for seven years from the Closing Date. The Warrants and the shares of Company Common Stock issuable exercise of the Warrants shall be tradeable in accordance with the provisions of Rule 144 of the Securities Act of 1933, as amended (the “Securities Act”). The Warrants include a customary net exercise provision and customary anti-dilution adjustments with respect to stock splits, stock dividends and the like, among other customary provisions for instruments of this type.

The Warrants were issued in reliance on the exemption from the registration requirements of the Securities Act provided by Section 4(a)(2) of the Securities Act. The Company has relied this exemption from registration based in part on representations made by the Lenders in the Warrant Agreements.

The foregoing descriptions of the 2024 LSA and the Warrants do not purport to be complete and are subject to and qualified in their entirety by reference to the full text of the 2024 LSA and the form of Warrant Agreement, which are filed as Exhibits 10.1 and 4.1 hereto, respectively, and are incorporated herein by reference.

Rule 10b5-1 Trading Arrangements

During the three months ended September 30, 2024, no director or officer (as defined in Rule 16a-1(f) of the Exchange Act) informed us of theadoption ortermination of a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement”, as each term is defined in Item 408(c) of Regulation S-K.