Exhibit
10.1


 


PULMATRIX,
INC.


 


July
9, 2020


 


Holder
of Common Stock Purchase Warrants


 


	Re:	Inducement Offer to Exercise Common Stock Purchase
Warrants




 


Dear
Holder:


 


Pulmatrix,
Inc. (the “Company”) is pleased to offer to you the opportunity to exercise all of the warrants to purchase
shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), issued to you
on April 8, 2019 (the “Existing Warrants”), as set forth on the signature page hereto and currently held by
you (the “Holder”). The issuance of the shares of Common Stock underlying the Existing Warrants (the “Warrant
Shares”) has been registered pursuant to the registration statements on Form S-1 (File Nos. 333-230395 and 333-230714)
(collectively, the “Registration Statements”). The Registration Statements are currently effective and, upon
exercise of the Existing Warrants pursuant to this letter agreement, will be effective for the issuance of the Warrant Shares.
Capitalized terms not otherwise defined herein shall have the meanings set forth in the applicable Existing Warrants.


 


In
consideration for exercising the number of Existing Warrants set forth on the Holder’s signature page hereto
(the “Warrant Exercise”) at the Exercise Price per Warrant Share as set forth in the Existing Warrants of $1.35,
the Company hereby offers to issue you or your designee:


 


a
new unregistered Common Stock Purchase Warrant (“New Warrant”) pursuant to Section 4(a)(2) of the Securities
Act of 1933, as amended (“Securities Act”), to purchase up to a number of shares (the “New Warrant
Shares”) of Common Stock equal to 100% of the number of Warrant Shares issued pursuant to the Warrant Exercise hereunder,
which New Warrant shall be substantially in the form as reflected in Exhibit A hereto, will be exercisable immediately,
and have a term of exercise of five (5) years, and an exercise price per share equal to $1.80.


 


The
original New Warrant certificate(s) will be delivered within two (2) Trading Days following the date hereof. Notwithstanding anything
herein to the contrary, in the event that any Warrant Exercise would otherwise cause the Holder to exceed the beneficial
ownership limitations (“Beneficial Ownership Limitation”) set forth in Section 2(e) of the Existing Warrants
(or, if applicable and at the Holder’s election, 9.99%), the Company shall only issue such number of Warrant Shares to the
Holder that would not cause the Holder to exceed the maximum number of Warrant Shares permitted thereunder, as directed by the
Holder, with the balance to be held in abeyance until notice from the Holder that the balance (or portion thereof) may be issued
in compliance with such limitations, which abeyance shall be evidenced through the Existing Warrants which shall be deemed prepaid
thereafter (including the payment in full of the exercise price), and exercised pursuant to a Notice of Exercise in the Existing
Warrant (provided no additional exercise price shall be due and payable).


 




    	 



    	 



    




 


Expressly
subject to the paragraph immediately following this paragraph below, Holder may accept this offer by signing this letter below,
with such acceptance constituting Holder’s Warrant Exercise for an aggregate exercise price set forth on the Holder’s
signature page hereto (the “Warrants Exercise Price”) on or before 8:30 a.m., Eastern Time, on July
9, 2020 (the “Execution Time”).


 


Additionally,
the Company agrees to the representations, warranties and covenants set forth on Annex A attached hereto. Holder represents
and warrants that, as of the date hereof it is, and on each date on which it exercises any New Warrants it will be, an “accredited
investor” as defined in Rule 501 of the Securities Act, and agrees that the New Warrants will contain restrictive legends
when issued, and neither the New Warrants nor the shares of Common Stock issuable upon exercise of the New Warrants will be registered
under the Securities Act, except as provided in Annex A attached hereto. Also, Holder is acquiring the New Warrants as
principal for its own account and has no direct or indirect arrangement or understandings with any other persons to distribute
or regarding the distribution of the New Warrants (this representation is not limiting Holder’s right to sell the New Warrant
Shares pursuant to an effective registration statement under the Securities Act or otherwise in compliance with applicable federal
and state securities laws). Holder further acknowledges that it has read and understands the supplemental disclosure set forth
on Annex B attached hereto.


 


The
Holder understands that the New Warrants and the shares of Common Stock underlying New Warrants are not, and may never be, registered
under the Securities Act, or the securities laws of any state and, accordingly, each certificate, if any, representing such securities
shall bear a legend substantially similar to the following:


 


“THIS
SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS.”


 




    	 



    	 



    

 


Certificates
evidencing shares of Common Stock underlying the New Warrants shall not contain any legend (including the legend set forth above),
(i) while a registration statement covering the resale of such Common Stock is effective under the Securities Act, (ii) following
any sale of such Common Stock pursuant to Rule 144 under the Securities Act, (iii) if such Common Stock is eligible for sale under
Rule 144 (assuming cashless exercise of the New Warrant), without the requirement for the Company to be in compliance with
the current public information required under Rule 144 as to such Common Stock and without volume or manner-of-sale restrictions,
(iv) if such Common Stock may be sold under Rule 144 (assuming cashless exercise of the New Warrant) and the Company is
then in compliance with the current public information required under Rule 144 as to such Common Stock, or (v) if such legend
is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued
by the staff of the Securities and Exchange Commission (the “Commission”) and the earliest of clauses
(i) through (v), the “Delegend Date”)). The Company shall cause its counsel to issue a legal opinion to the
Transfer Agent promptly after the Delegend Date if required by the Company and/or the Transfer Agent to effect the removal of
the legend hereunder, or at the request of the Holder, which opinion shall be in form and substance reasonably acceptable
to the Holder. From and after the Delegend Date, such Common Stock shall be issued free of all legends. The Company agrees
that following the Delegend Date or at such time as such legend is no longer required under this Section, it will, no later than
two (2) Trading Days following the delivery by the Holder to the Company or the Transfer Agent of a certificate representing the
Common Stock underlying the New Warrants issued with a restrictive legend (such second (2nd) Trading Day, the “Legend
Removal Date”), deliver or cause to be delivered to the Holder a certificate representing such shares that is free from
all restrictive and other legends or, at the request of the Holder shall credit the account of the Holder’s prime broker
with the Depository Trust Company System as directed by the Holder.


 


In addition to the Holder’s
other available remedies, the Company shall pay to a Holder, in cash, (i) as partial liquidated damages and not as a penalty,
for each $1,000 of New Warrant Shares (based on the VWAP of the Common Stock on the date such New Warrant Shares are submitted
to the Transfer Agent) delivered for removal of the restrictive legend, $10 per Trading Day (increasing to $20 per Trading Day
five (5) Trading Days after such damages have begun to accrue) for each Trading Day after the Legend Removal Date until such certificate
is delivered without a legend and (ii) if the Company fails to (a) issue and deliver (or cause to be delivered) to the Holder
by the Legend Removal Date a certificate representing the New Warrant Shares so delivered to the Company by the Holder that is
free from all restrictive and other legends and (b) if after the Legend Removal Date the Holder purchases (in an open market transaction
or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of all or any portion of the number of
shares of Common Stock, or a sale of a number of shares of Common Stock equal to all or any portion of the number of shares of
Common Stock that the Holder anticipated receiving from the Company without any restrictive legend, then, an amount equal to the
excess of the Holder’s total purchase price (including brokerage commissions and other out-of-pocket expenses, if any) for
the shares of Common Stock so purchased (including brokerage commissions and other out-of-pocket expenses, if any) (the “Buy-In
Price”) over the product of (A) such number of New Warrant Shares that the Company was required to deliver to the Holder
by the Legend Removal Date and for which the Holder was required to purchase shares to timely satisfy delivery requirements, multiplied
by (B) the weighted average price at which the Holder sold that number of shares of Common Stock.


 




    	 



    	 



    

 


From
the date hereof until thirty (30) days after the Closing Date, neither the Company nor any Subsidiary shall, (A) issue, enter into any agreement to issue or announce the
issuance or proposed issuance of any Common Stock or Common Stock Equivalents or (B) file any registration statement or any amendment
or supplement to any existing registration statement (other than the resale registration statement referred to herein or prospectus
supplements to the Registration Statements to reflect the transactions contemplated hereby). Notwithstanding the foregoing, this
paragraph shall not apply to the issuance of (a) shares of Common Stock or options to employees, officers or directors of the
Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board
of Directors of the Company or a majority of the members of a committee of non-employee directors established for such purpose
for services rendered to the Company, (b) securities upon the exercise or exchange of or conversion of any securities issued hereunder
and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the
date of this letter agreement, provided that such securities have not been amended since the date of this letter agreement to
increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities
(other than in connection with stock splits or combinations) or to extend the term of such securities, and (c) securities issued
pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided
that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights
that require or permit the filing of any registration statement in connection therewith during the prohibition period set forth
herein, and provided that any such issuance shall only be to a Person (or to the equityholders of a Person) which is, itself or
through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company
and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction
in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business
is investing in securities.


 


If
this offer is accepted and the transaction documents are executed by the Execution Time, then on or before 9:00 a.m., Eastern
Time, on July 9, 2020, the Company shall issue a press release or file a Current Report on Form 8-K with the Commission
disclosing all material terms of the transactions contemplated hereunder. From and after the issuance of such press release or
the filing of such Current Report on Form 8-K, as applicable, the Company represents to you that it shall have publicly disclosed
all material, non-public information delivered to you by the Company, or any of its respective officers, directors, employees
or agents in connection with the transactions contemplated hereunder. In addition, effective upon the issuance of such press release
and/or Current Report on Form 8-K, the Company acknowledges and agrees that any and all confidentiality or similar obligations
under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers,
directors, agents, employees or Affiliates on the one hand, and you and your Affiliates on the other hand, shall terminate. The
Company represents, warrants and covenants that, upon acceptance of this offer, the shares underlying the Existing Warrants shall
be issued free of any legends or restrictions on resale by Holder.


 




    	 



    	 



    

 


No
later than the second (2nd) Trading Day following the date hereof, the closing shall occur at such location as the parties shall
mutually agree. Unless otherwise directed by H.C. Wainwright & Co., LLC (the “Placement Agent”), settlement of
the Warrant Shares shall occur via “Delivery Versus Payment” (“DVP”) (i.e., on the Closing Date,
the Company shall issue the Warrant Shares registered in the Holders’ names and addresses and released by the Transfer Agent
directly to the account(s) at the Placement Agent identified by each Holder; upon receipt of such Warrant Shares, the Placement
Agent shall promptly electronically deliver such Warrant Shares to the applicable Holder, and payment therefor shall be made by
the Placement Agent (or its clearing firm) by wire transfer to the Company). The date of the closing of the exercise of the Existing
Warrants shall be referred to as the “Closing Date”.


 


The
Company acknowledges and agrees that the obligations of the Holders under this letter agreement are several and not joint with
the obligations of any other holder or holders of warrants to purchase Common Stock of the Company that were issued by the Company
on April 8, 2019 (each, an “Other Holder”) under any other agreement related to the exercise of such warrants
(“Other Warrant Exercise Agreement”), and the Holder shall not be responsible in any way for the performance
of the obligations of any Other Holder or under any such Other Warrant Exercise Agreement. Nothing contained in this letter agreement,
and no action taken by the Holders pursuant hereto, shall be deemed to constitute the Holder and the Other Holders as a partnership,
an association, a joint venture or any other kind of entity, or create a presumption that the Holder and the Other Holders are
in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by this letter agreement
and the Company acknowledges that the Holder and the Other Holders are not acting in concert or as a group with respect to such
obligations or the transactions contemplated by this letter agreement or any Other Warrant Exercise Agreement. The Company and
the Holder confirm that the Holder has independently participated in the negotiation of the transactions contemplated hereby with
the advice of its own counsel and advisors. The Holder shall be entitled to independently protect and enforce its rights, including,
without limitation, the rights arising out of this letter agreement, and it shall not be necessary for any Other Holder to be
joined as an additional party in any proceeding for such purpose.


 


The
Company hereby represents and warrants as of the date hereof and covenants and agrees from and after the date hereof until ninety
(90) days after the date hereof, that none of the terms offered to any Other Holder with respect to any Other Warrant Exercise
Agreement (or any amendment, modification or waiver thereof) relating to warrants that were sold concurrently with the Existing
Warrants, is or will be more favorable to such Other Holder than those of the Holder and this letter agreement unless such terms
are concurrently offered to the Holder. If, and whenever on or after the date hereof until ninety (90) days after the date
hereof, the Company enters into an Other Warrant Exercise Agreement relating to warrants that were sold concurrently with the
Existing Warrants, then (i) the Company shall provide notice thereof to the Holder promptly following the occurrence thereof and
(ii) the terms and conditions of this letter agreement shall be, without any further action by the Holder or the Company, automatically
amended and modified in an economically and legally equivalent manner such that the Holder shall receive the benefit of the more
favorable terms and/or conditions (as the case may be) set forth in such Other Warrant Exercise Agreement (including the issuance
of additional Warrant Shares), provided that upon written notice to the Company at any time the Holder may elect not to accept
the benefit of any such amended or modified term or condition, in which event the term or condition contained in this letter agreement
shall apply to the Holder as it was in effect immediately prior to such amendment or modification as if such amendment or modification
never occurred with respect to the Holder. The provisions of this paragraph shall apply similarly and equally to each such Other
Warrant Exercise Agreement.


 


***************


 




    	 



    	 



    

 





	 	Sincerely
    yours,
	 	 	 
	 	PULMATRIX,
    INC.
	 	 	 
	 	By:
    	               
	 	Name:
    	 
	 	Title:
    	 


 




    	 



    	 



    

 


Accepted
and Agreed to:


 


Name
of Holder: ________________________________________________________


 


Signature
of Authorized Signatory of Holder: _________________________________


 


Name
of Authorized Signatory: _______________________________________________


 


Title
of Authorized Signatory: ________________________________________________


 


Number
of Existing Warrants: ______________


 


Aggregate
Existing Warrant Exercise Price: ______________


 


New
Warrants: (100% of total Existing Warrants being exercised): ___________


 


Beneficial
Ownership Blocker: [  ] 4.99% or [  ] 9.99%


 


DTC
Instructions:


 




    	 



    	 



    

 


Annex
A


 


Representations,
Warranties and Covenants of the Company. The Company hereby makes the following representations and warranties to the Holder:


 


	a)	SEC
                                 Reports. The Company has filed all reports, schedules, forms, statements and other documents
                                 required to be filed by the Company under the Exchange Act, including pursuant to Section 13(a)
                                 or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the
                                 Company was required by law or regulation to file such material) (the foregoing materials, including
                                 the exhibits thereto and documents incorporated by reference therein “SEC Reports”).
                                 As of their respective dates, the SEC Reports complied in all material respects with the requirements
                                 of the Exchange Act and none of the SEC Reports, when filed, contained any untrue statement of
                                 a material fact or omitted to state a material fact required to be stated therein or necessary
                                 in order to make the statements therein, in the light of the circumstances under which they were
                                 made, not misleading. The Company has never been an issuer subject to Rule 144(i) under the Securities
                                 Act.
	 	 
	b)	Authorization;
                                 Enforcement. The Company has the requisite corporate power and authority to enter into and
                                 to consummate the transactions contemplated by this letter agreement and otherwise to carry out
                                 its obligations hereunder and thereunder. The execution and delivery of this letter agreement
                                 by the Company and the consummation by the Company of the transactions contemplated hereby have
                                 been duly authorized by all necessary action on the part of the Company and no further action
                                 is required by the Company, its board of directors or its stockholders in connection therewith.
                                 This letter agreement has been duly executed by the Company and, when delivered in accordance
                                 with the terms hereof, will constitute the valid and binding obligation of the Company enforceable
                                 against the Company in accordance with its terms, except (i) as limited by general equitable
                                 principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of
                                 general application affecting enforcement of creditors’ rights generally, (ii) as limited
                                 by laws relating to the availability of specific performance, injunctive relief or other equitable
                                 remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable
                                 law.
	 	 
	c)	No
                                 Conflicts. The execution, delivery and performance of this letter agreement by the Company
                                 and the consummation by the Company of the transactions contemplated hereby do not and will not:
                                 (i) conflict with or violate any provision of the Company’s certificate or articles of
                                 incorporation, bylaws or other organizational or charter documents; or (ii) conflict with, or
                                 constitute a default (or an event that with notice or lapse of time or both would become a default)
                                 under, result in the creation of any liens, claims, security interests, other encumbrances or
                                 defects upon any of the properties or assets of the Company in connection with, or give to others
                                 any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse
                                 of time or both) of, any material agreement, credit facility, debt or other material instrument
                                 (evidencing Company debt or otherwise) or other material understanding to which such Company
                                 is a party or by which any property or asset of the Company is bound or affected; or (iii) conflict
                                 with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree
                                 or other restriction of any court or governmental authority to which the Company is subject (including
                                 federal and state securities laws and regulations), or by which any property or asset of the
                                 Company is bound or affected, except, in the case of each of clauses (ii) and (iii), such as
                                 could not have or reasonably be expected to result in a material adverse effect upon the business,
                                 prospects, properties, operations, condition (financial or otherwise) or results of operations
                                 of the Company, taken as a whole, or in its ability to perform its obligations under this letter
                                 agreement.
	 	 
	d)	Registration
                                         Obligations. The Company shall prepare and file with the Commission a registration
                                         statement relating to the resale of the shares of Common Stock underlying the New Warrants
                                         by the holders of the New Warrants under the Securities Act on or before the 30th
                                         calendar day following the date hereof and use commercially reasonable best efforts
                                         to cause such registration statement to be declared effective by the Commission as soon
                                         as practical thereafter.
	 	 
	e)	Nasdaq
                                 Corporate Governance. The transactions contemplated under this letter agreement comply with
                                 all the rules and regulations of the Nasdaq Capital Market.