Item
1.01 Entry Into a Material Definitive Agreement
On
February 11, 2021, Pulmatrix, Inc. (the “Company”) entered into a Securities Purchase Agreement (the “Purchase
Agreement”) with certain institutional and accredited investors (the “Purchasers”), pursuant to which
the Company agreed to issue and sell in a registered direct offering (the “Offering”) an aggregate of 20,000,000 shares
(the “Shares”) of common stock of the Company, par value $0.0001 per share (the “Common Stock”), at an
offering price of $2.00 per share.
Pursuant
to an engagement letter (the “Engagement Letter”) the Company entered with H.C. Wainwright & Co., LLC (the “Placement
Agent”), the Placement Agent agreed to serve as the exclusive placement agent for the Company, on a reasonable best efforts
basis, in connection with the Offering. The Company agreed to pay the Placement Agent an aggregate cash fee equal to 7.0% of the
gross proceeds received in the Offering. In addition, the Company has agreed to grant to the Placement Agent or its designees
warrants to purchase up to 1,300,000 shares of Common Stock at an exercise price of $2.50 per share (the “Placement Agent
Warrants”) in a private placement. The Placement Agent Warrants are exercisable immediately upon issuance and will have
a term of five years from the commencement of the sales pursuant to the Offering. A holder of a Placement Agent Warrant
will not have the right to exercise any portion of its warrants if the holder, together with its affiliates, would beneficially
own in excess of 4.99% of the number of shares of Common
Stock outstanding immediately after giving effect to such exercise (the “Beneficial Ownership Limitation”); provided,
however, that upon 61 days’ prior notice to the Company, the holder may increase or decrease the Beneficial Ownership Limitation,
provided that in no event shall the Beneficial Ownership Limitation exceed 9.99%. The Company will also pay the Placement Agent
$75,000 for non-accountable expenses and $15,950 for clearing expenses.
Neither
the Placement Agent Warrants nor the shares of Common Stock issuable upon the exercise of the Placement Agent Warrants (the “Placement
Agent Warrant Shares”) will be registered under the Securities Act of 1933, as amended (the “Securities Act”)
or any state securities laws. The Placement Agent Warrants and the Placement Agent Warrant Shares will be issued in reliance on
the exemptions from registration provided by Section 4(a)(2) under the Securities Act and Regulation D promulgated thereunder.
The Placement Agent has represented that it is an accredited investor, as defined in Rule 501 of Regulation D promulgated under
the Securities Act.
The
net proceeds to the Company from the Offering, after deducting the Placement Agent’s fees and expenses and the Company’s
estimated offering expenses, and excluding the proceeds, if any, from the exercise of the Placement Agent Warrants, are expected
to be approximately $37.1 million. The Company currently intends to use these net proceeds for working capital and general corporate
purposes.
On
February 16, 2021, the Company filed a prospectus supplement, dated February 11, 2021 (the “Prospectus Supplement”),
to a shelf registration statement on Form S-3 (File No. 333-230225), which was initially filed with the Securities and Exchange
Commission (the “Commission”) on March 12, 2019, and was declared effective by the Commission on March 15, 2019, covering
the Offering (the “Shelf Registration Statement”).
The
description of terms and conditions of the Purchase Agreement, Engagement Letter and the Placement Agent Warrants set forth herein
do not purport to be complete and are qualified in their entirety by the full text of the Purchase Agreement, the Engagement Letter
and the form of Placement Agent Warrant, which are attached hereto as Exhibits 10.1, 99.1 and 4.1, respectively.