refer to this activity as the Conversion. As a result, the members of Avidity LLC became our stockholders in the same ownership proportions as immediately prior to the Conversion, and all
2,920,058 common units, 4,350,299 Series A preferred units and 8,108,471 Series B preferred units of Avidity LLC outstanding at the time of the Conversion were converted into 2,920,058 shares of common stock, 4,350,299 shares of Series A
convertible preferred stock and 8,108,471 shares of Series B convertible preferred stock, respectively, of Avidity Biosciences, Inc.
Convertible Promissory
Note Financings
2018 Notes. In July 2018, we issued and sold in a private placement to certain investors an aggregate
principal amount of $3.0 million in convertible promissory notes (the 2018 Notes). The 2018 Notes accrued interest at a rate of 8% per annum. The 2018 Notes, including an aggregate of approximately $307,000 in accrued interest
thereon, were automatically converted into shares of our Series C convertible preferred stock in the Series C convertible preferred stock financing described below.
2019 Notes. In February 2019, we issued and sold in a private placement to certain investors an aggregate principal amount of
$4.5 million in convertible promissory notes (the 2019 Notes). The 2019 Notes accrued interest at a rate of 10% per annum. The 2019 Notes, including an aggregate of approximately $322,000 in accrued interest thereon, were
automatically converted into shares of our Series C convertible preferred stock in the Series C convertible preferred stock financing described below.
Agreements with Lilly
In April 2019, we and Eli Lilly and Company
(Lilly) entered into a research collaboration and license agreement. In connection with our entry into the research collaboration and license agreement, we entered into a convertible note purchase agreement with Lilly pursuant to which
we issued and sold in a private placement to Lilly a convertible promissory note in the principal amount of $15.0 million (the Lilly Note). The Lilly Note accrued interest at a rate of 8% per annum. The Lilly Note, including
approximately $674,000 in accrued interest thereon, was automatically converted into shares of our Series C convertible preferred stock in the Series C convertible preferred stock financing described below. Lilly is a beneficial owner of more than
5% of our capital stock.
Convertible Preferred Unit and Preferred Stock Financings
Series B Convertible Preferred Unit Financings. In December 2016, we entered into a Series B preferred unit purchase agreement,
pursuant to which we sold to investors in an initial closing and subsequent closings from December 2016 to October 2017 in private placements an aggregate of 8,108,471 Series B preferred units. The per unit purchase price was $2.8269, and we
received gross proceeds of approximately $21.3 million, which included the conversion of previously outstanding convertible promissory notes at a discounted price of $2.2615 per unit.
Series C Convertible Preferred Stock Financings. In November 2019, we entered into a Series C preferred stock purchase
agreement, pursuant to which we sold to investors in an initial closing and a subsequent closing in November 2019 and January 2020, respectively, in private placements, an aggregate of 18,452,757 shares of Series C convertible preferred stock. The
per share purchase price was $4.2812, and we received gross proceeds of approximately $79.0 million. In addition, the 2018 Notes, the 2019 Notes and the Lilly Note were converted into 6,893,036 shares of Series C convertible preferred stock at
discounted purchase prices of $3.639, $3.425 and $3.425, respectively.
The following table sets forth the aggregate number of these securities acquired by the
listed directors, executive officers or holders of more than 5% of our capital stock, or their affiliates. Each outstanding Series B preferred unit, including the Series B preferred units identified in the following table, was converted
into one share of Series B convertible preferred stock in connection with the Conversion. Each outstanding share of convertible
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