Elicio Therapeutics, Inc.

Current report

Changes in United States trade policy, including recently announced or potential future tariffs, could have a material adverse impact on our business, financial condition, and results of operations. The imposition of new tariffs or increases in existing tariffs on goods imported from or expected to be imported from countries where we or our suppliers operate could result in higher costs for materials or components essential to our operations. For example, in April 2025, the United States imposed broad tariffs on imports from virtually all countries, with particularly high tariffs on imports from China. Since this announcement, most tariffs for countries other than China have been suspended temporarily. In response to tariffs, some countries have implemented retaliatory tariffs on U.S. goods, while others seek to negotiate agreements regarding U.S.-imposed tariffs. Historically, tariffs have led to increased trade and political tensions and, to date, the outcome of the negotiations between the United States and the various countries is not yet clear. Political tensions as a result of trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. Any changes in political, trade, regulatory, and economic conditions, including U.S. trade policies, could have a material adverse effect on our financial condition or results of operations.

Previous report

Our largest stockholder has significant influence over us, including influence over decisions that require the approval of stockholders, which could limit our stockholders’ ability to influence the outcome of key transactions, including a change of control.

Previous report

GKCC, LLC (“GKCC”), an entity controlled by a member of our board of directors, beneficially owns 19.99% of our outstanding common stock. Additionally, GKCC holds pre-funded warrants to purchase approximately 4.0 million shares of common stock and a convertible note that is convertible into approximately 3.0 million shares of common stock, neither of which are currently convertible into shares of common stock due to a 19.99% beneficial ownership limitation. Although we are not a “controlled company” within the meaning of the corporate governance standards of the Nasdaq Stock Market LLC, GKCC is able to significantly influence our decisions. Furthermore, should the convertible securities held by GKCC no longer be subject to the 19.99% beneficial ownership limitation and should they be converted into shares of our common stock, GKCC could own an even greater percentage of our outstanding common stock. Additionally, GKCC’s interests may not align with the interests of our other stockholders. GKCC may make investments in companies and may acquire and hold interests in businesses that compete directly or indirectly with us. GKCC may also pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us.

Previous report

The terms of our convertible note arrangement with GKCC, an entity controlled by a member of our board of directors, places certain restrictions on our operating and financial flexibility. If we raise additional capital through debt financing, the terms of any new debt could further restrict our ability to operate our business.

Previous report

On August 12, 2024, we entered into a securities purchase agreement (the “Securities Purchase Agreement”) pursuant to which we issued a 3.0% Senior Secured Convertible Promissory Note due February 15, 2026 (the “Convertible Note”) in the principal amount of $20.0 million (the “Note Financing”). The purchaser of the Convertible Note was GKCC. If we raise any additional debt through a financing, the terms of such additional debt could further restrict our operating and financial flexibility. These restrictions may include, among other things, limitations on borrowing and specific restrictions on the use of the proceeds of such additional debt financing, as well as prohibitions on our ability to incur further debt financing, create liens, pay dividends, redeem capital stock or make investments.

Previous report

If we default under the terms of the Convertible Note beyond the applicable grace period, if any, GKCC may declare all amounts outstanding under the Convertible Note to be immediately due and payable. If we are unable to repay the amounts due under the Convertible Note upon GKCC’s declaration, GKCC could proceed against the collateral granted to it to secure the obligations under the Securities Purchase Agreement (including, but not limited to taking control of our pledged assets and foreclosing on other collateral, including those of our subsidiaries, Elicio Operating Company, Inc. and Elicio Securities Corp.). The enforcement by GKCC upon its declaration to accelerate the obligations under the Convertible Note, as mentioned above, could adversely affect our operations. Further, if we are liquidated, GKCC’s right to repayment, as well as the right to repayment of other lenders under any additional debt financing, would be senior to the rights of the holders of our common stock.