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Windtree Therapeutics, Inc. (OTCID:WINT) announced Tuesday it has issued $857,142.86 in senior convertible promissory notes due 2026 to an institutional investor. The transaction, which took place on November 25, was disclosed in a press release statement filed with the Securities and Exchange Commission. The micro-cap company, currently trading at just $0.05 per share with a market capitalization of $1.65 million, has seen its stock plummet nearly 100% over the past year according to InvestingPro data. The company’s financial health is rated as "WEAK" with a score of just 1.24 out of 10.
The 2026 Notes were issued in connection with a letter of intent by Windtree to acquire all outstanding securities of CommLoan Inc. Of the proceeds, $450,000 will be advanced to CommLoan, while $150,000 will be used for general corporate purposes. This move comes as InvestingPro data shows Windtree is "quickly burning through cash" with a concerning current ratio of 0.33, indicating its short-term obligations significantly exceed its liquid assets.
The notes carry a 10% annual interest rate, calculated on a 360-day basis, and mature on November 26, 2026. Interest payments are due monthly, starting November 25, 2025. The notes must be prepaid by Windtree in an amount equal to 25% of gross proceeds received from a specific Common Stock Purchase Agreement dated June 26, 2024, with a mandatory prepayment premium of 115%.
If Windtree completes a qualified equity financing of $1 million or more before maturity, the notes must be repaid in full, including principal, accrued interest, and a prepayment premium of 115% of the notes’ value as of November 25, 2025. The holder will have the opportunity to convert the notes before such a repayment. This additional debt burden is particularly notable as InvestingPro analysis indicates Windtree "operates with a significant debt burden" and has not been profitable over the last twelve months, with a concerning return on assets of -172.27%.
The notes are convertible at the holder’s option into shares of Windtree’s common stock at a conversion price equal to 90% of the lowest sale price for the 20 consecutive trading days before conversion, subject to adjustment. A beneficial ownership limitation restricts the holder to 4.99% of Windtree’s outstanding common stock, which may be increased to 9.99% with 61 days’ notice.
The agreement includes provisions for events of default, a requirement to file a resale registration statement within 45 days, and adjustment of the conversion price in the event of a dilutive issuance of new equity. The holder may also apply outstanding principal and interest as consideration in future public or private offerings at a price equal to 80% of the cash purchase price paid by other investors.
This summary is based on a company statement filed with the SEC.
In other recent news, Windtree Therapeutics has issued $1.6 million in senior convertible promissory notes due in 2026. These notes carry an annual interest rate of 10% and were issued to institutional investors as part of a settlement related to a previous purchase and sale agreement involving its subsidiary, WINT Real Estate, LLC. Additionally, the company has settled a real estate dispute concerning a property known as the Aubrey, resulting in a $750,000 escrow release. Windtree Therapeutics also announced the resignation of its Chief Medical Officer, Steven G. Simonson, M.D., with no further details provided on his departure. Meanwhile, at a recent Special Meeting of Stockholders, the company received approval for several proposals regarding share issuance and amendments to its charter and equity plans. These approvals include the issuance of Series D Convertible Shares and other related shares in compliance with Nasdaq Listing Rules. These developments reflect Windtree Therapeutics’ ongoing financial and operational adjustments.
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