Windtree Therapeutics issues $1.6 million in convertible notes due 2026

Windtree Therapeutics, Inc. (OTCID:WINT), a micro-cap company with a market value of $4.37 million, announced the issuance of $1.6 million in senior convertible promissory notes to institutional investors on October 9, 2025, according to a statement filed with the Securities and Exchange Commission. InvestingPro analysis indicates the company faces significant financial challenges, with a weak financial health score and rapidly diminishing cash reserves.

The notes, which mature on October 9, 2026, carry an annual interest rate of 10% calculated on a 360-day basis. Interest payments are due in arrears on the fifth calendar day of each month, beginning November 5, 2025. The notes were issued in connection with the termination and settlement of agreements related to a prior purchase and sale arrangement involving WINT Real Estate, LLC, a subsidiary of Windtree Therapeutics, and Way Maker Growth Fund, LLC. The company’s current ratio of 0.43 suggests potential challenges in meeting short-term obligations.

The notes are junior to a previous convertible promissory note issued in June 2025 to DFU, LLC, which holds senior unsecured status and priority over other company indebtedness.

Windtree is required to prepay 25% of the gross proceeds it receives from a specific common stock purchase agreement, with a mandatory prepayment premium of 120%. If the company completes a qualified equity financing of $1 million or more before maturity, the notes must be repaid in full, including accrued interest and a 120% prepayment premium, within one business day of the financing’s closing. Holders may convert the notes into common stock at a price equal to 90% of the lowest sale price over the 20 consecutive trading days before conversion, subject to adjustment. A beneficial ownership limitation of 4.99% applies, which can be increased to 9.99% with 61 days’ notice.

If Windtree issues stock or equivalents at a price lower than the current conversion price, the conversion price will be adjusted to match the lower price, with certain exemptions. The notes also include provisions for adjustment in the event of mergers or similar transactions, and allow holders to participate in future offerings at a conversion price of 80% of the cash purchase price.

The company must file a resale registration statement on Form S-1 within 20 days after October 9, 2025, for securities related to the notes. This information is based on a press release statement included in the SEC filing.

In other recent news, Windtree Therapeutics, Inc. has reported several key developments. The company announced the results of its Special Meeting of Stockholders, where stockholders approved the issuance of various shares, including Series D Convertible Shares and Series E Preferred Stock. This approval aligns with Nasdaq Listing Rules 5635(b) and (d). In a significant corporate update, Windtree Therapeutics will be delisted from the Nasdaq Capital Market due to noncompliance and will begin trading over-the-counter. Additionally, the company has seen a major reduction in its preferred stock, with investors redeeming or converting the majority of its Series C and Series D Preferred Stock.

Furthermore, Windtree Therapeutics settled a real estate dispute involving a property in Houston, Texas, resulting in a $750,000 receipt from escrow. In executive news, the company announced the resignation of its Chief Medical Officer, Dr. Steven G. Simonson, effective immediately. These recent developments reflect significant changes and strategic decisions within the company.

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