# EDGAR Filing Document

**Accession Number:** 0001574235
**File Stem:** 0001493152-26-008130
**Filing Date:** 2026-2
**Character Count:** 484568
**Document Hash:** 03ed7e8d7e610ec34f28dd521ef10186
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-26-008130.hdr.sgml**: 20260226

**ACCESSION NUMBER**: 0001493152-26-008130

**CONFORMED SUBMISSION TYPE**: 10-K

**PUBLIC DOCUMENT COUNT**: 69

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260226

**DATE AS OF CHANGE**: 20260226

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Pulmatrix, Inc.
- **CENTRAL INDEX KEY:** 0001574235
- **STANDARD INDUSTRIAL CLASSIFICATION:** PHARMACEUTICAL PREPARATIONS [2834]
- **ORGANIZATION NAME:** 03 Life Sciences
- **EIN:** 461821392
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-36199
- **FILM NUMBER:** 26681816

**BUSINESS ADDRESS:**
- **STREET 1:** 945 CONCORD STREET
- **STREET 2:** SUITE 1217
- **CITY:** FRAMINGHAM
- **STATE:** MA
- **ZIP:** 01701
- **BUSINESS PHONE:** (888) 355-4440

**MAIL ADDRESS:**
- **STREET 1:** 945 CONCORD STREET
- **STREET 2:** SUITE 1217
- **CITY:** FRAMINGHAM
- **STATE:** MA
- **ZIP:** 01701

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Ruthigen, Inc.
- **DATE OF NAME CHANGE:** 20130411

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-K**

**(Mark One)**

☒ **ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934** 

**For the fiscal year ended December 31, 2025**

**or**

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the transition period from ___________ to** __________

**Commission file number: 001-36199**

**PULMATRIX, INC.**

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **Delaware** | **46-1821392** |
| (State or other jurisdiction of<br> incorporation or organization) | (I.R.S. Employer<br> Identification No.) |
| **945 Concord Street, Suite 1217**<br> **Framingham, MA** | **01701** |
| (Address of principal executive offices) | (Zip Code) |

---

**(888) 355-4440**

Registrant's telephone number, including area code

**Securities registered pursuant to Section 12(b) of the Exchange Act:**

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| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| **Common Stock, par value $0.0001 per share** | **PULM** | **The Nasdaq Stock Market LLC** |

---

**Securities registered pursuant to Section 12(g) of the Exchange Act: None**

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

---

| | | | |
|:---|:---|:---|:---|
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
|  |  | Emerging growth company | ☐ |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☐ No ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the registrant's voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, as of June 30, 2025, the last business day of registrant's most recently completed second fiscal quarter, was $25,200,594.

As of February 23, 2026, the registrant had 3,652,285 shares of common stock, par value $0.0001 per share, issued and outstanding.

**DOCUMENTS INCORPORATED BY REFERENCE**

None.

**PULMATRIX, INC.**

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
|  |  | **Page No.** |
| [Forward-Looking Statements](#a_002) | [Forward-Looking Statements](#a_002) | 1 |
| **[PART I](#a_001)** | **[PART I](#a_001)** |  |
| Item 1. | [Business.](#a_003) | 2 |
| Item 1A. | [Risk Factors](#a_004). | 20 |
| Item 1B. | [Unresolved Staff Comments.](#sk_008) | 54 |
| Item 1C. | [Cybersecurity.](#sk_009) | 54 |
| Item 2. | [Properties.](#sk_010) | 55 |
| Item 3. | [Legal Proceedings.](#sk_011) | 55 |
| Item 4. | [Mine Safety Disclosures.](#sk_012) | 55 |
| **[PART II](#sk_013)** | **[PART II](#sk_013)** |  |
| Item 5. | [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.](#sk_014) | 56 |
| Item 6. | [Reserved.](#sk_015) | 56 |
| Item 7. | [Management's Discussion and Analysis of Financial Condition and Results of Operations.](#sk_016) | 56 |
| Item 7A. | [Quantitative and Qualitative Disclosures About Market Risk.](#sk_017) | 64 |
| Item 8. | [Financial Statements and Supplementary Data.](#sk_018) | 64 |
| Item 9. | [Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.](#sk_019) | 65 |
| Item 9A. | [Controls and Procedures.](#sk_020) | 65 |
| Item 9B. | [Other Information.](#sk_021) | 66 |
| Item 9C. | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.](#sk_022) | 66 |
| **[PART III](#sk_023)** | **[PART III](#sk_023)** |  |
| Item 10. | [Directors, Executive Officers and Corporate Governance.](#sk_024) | 67 |
| Item 11. | [Executive Compensation.](#sk_025) | 74 |
| Item 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.](#sk_026) | 76 |
| Item 13. | [Certain Relationships and Related Transactions, and Director Independence.](#sk_027) | 77 |
| Item 14. | [Principal Accountant Fees and Services.](#sk_028) | 77 |
| **[PART IV](#sk_029)** | **[PART IV](#sk_029)** |  |
| Item 15. | [Exhibits, Financial Statement Schedules.](#sk_030) | 79 |
| Item 16. | [Form 10-K Summary.](#sk_031) | 79 |
| [Signatures](#sk_001) | [Signatures](#sk_001) | 84 |

---

**PART I**

**Forward-Looking Statements**

This Annual Report on Form 10-K contains forward-looking statements. All statements other than statements of historical fact contained herein, including statements regarding our business plans or strategies, projected or anticipated benefits or other consequences of our plans or strategies, projected or anticipated benefits from acquisitions to be made by us, or projections involving anticipated revenues, earnings, or other aspects of our operating results, are forward-looking statements. Words such as "anticipates," "assumes," "believes," "can," "could," "estimates," "expects," "forecasts," "guides," "intends," "is confident that," "may," "plans," "seeks," "projects," "targets," and "would," and their opposites and similar expressions, as well as statements in future tense, are intended to identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will actually be achieved. Forward-looking statements are based on information we have when those statements are made or our management's good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:

● the risk that the conditions to closing of the potential Merger with Cullgen (each as defined herein) are not satisfied, including failure to obtain approval from the CSRC (as defined herein);

● the risk that we are unable to meet expectations regarding the timing and completion of the Merger;

● uncertainties as to the timing and costs of the consummation of the transactions contemplated by the Merger Agreement (as defined herein);

● the occurrence of any event, change or other circumstance or condition that could give rise to the termination of the Merger Agreement;

● the outcome of any legal proceedings that may be instituted against us, Cullgen, or any of each company's respective directors or officers related to the Merger Agreement or the transactions contemplated thereby;

● should we resume development of our product candidates, our history of recurring losses and negative cash flows from operating activities, significant future commitments and the uncertainty regarding the adequacy of our liquidity to pursue or complete our business objectives;

● should we resume development of our product candidates, our inability to carry out research, development and commercialization plans;

● should we resume development of our product candidates, our inability to manufacture our product candidates on a commercial scale on our own or in collaborations with third parties;

● should we resume development of our product candidates, our inability to complete preclinical testing and clinical trials as anticipated;

● should we resume development of our product candidates, our collaborators' inability to successfully carry out their contractual duties;

● should we resume development of our product candidates, termination of certain license agreements;

● should we resume development of our product candidates, our ability to adequately protect and enforce rights to intellectual property, or defend against claims of infringement by others;

● should we resume development of our product candidates, difficulties in obtaining financing on commercially reasonable terms, or at all;

● should we resume development of our product candidates, intense competition in our industry, with competitors having substantially greater financial, technological, research and development, regulatory and clinical, manufacturing, marketing and sales, distribution, personnel and resources than we do;

● should we resume development of our product candidates, entry of new competitors and products and potential technological obsolescence of our products;

● adverse market and economic conditions;

● our ability to maintain compliance with the listing standards of the Nasdaq Capital Market ("Nasdaq");

● loss of one or more key executives; and

● should we resume development of our product candidates, difficulties in securing regulatory approval to market our product candidates.

For a more detailed discussion of the risks that may affect our business and that could cause our actual results to differ from those projected in these forward-looking statements, see the risk factors and uncertainties described under the heading "Risk Factors" in Part I, Item 1A of this Annual Report on Form 10-K. The forward-looking statements contained in this Annual Report on Form 10-K are expressly qualified in their entirety by this cautionary statement. We do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which any such statement is made or to reflect the occurrence of unanticipated events, except as required by law.

Unless otherwise stated, references in this Annual Report on Form 10-K to "us," "we," "our," or "Company" refer to Pulmatrix, Inc., a Delaware corporation, and its subsidiaries, Pulmatrix Operating Company, Inc. and PCL Merger Sub, Inc., both Delaware corporations.

"iSPERSE*<sup>™</sup>*" is one of our trademarks used in this Annual Report on Form 10-K. Other trademarks appearing in this report are the property of their respective holders. Solely for convenience, these and other trademarks, trade names and service marks referred to in this report appear without the <sup>®</sup>, TM and SM symbols, but those references are not intended to indicate, in any way, we or the owners of such trademarks will not assert, to the fullest extent under applicable law, their rights to these trademarks and trade names.

---

| | |
|:---|:---|
| **ITEM 1.** | **BUSINESS.** |

---

*Overview*

We are a biopharmaceutical company that has focused on the development of novel inhaled therapeutic products intended to prevent and treat migraine and respiratory diseases with important unmet medical needs using our patented iSPERSE<sup>™</sup> technology. Our proprietary product pipeline includes treatments for central nervous system ("CNS") disorders such as acute migraine and serious lung diseases such as Chronic Obstructive Pulmonary Disease ("COPD") and allergic bronchopulmonary aspergillosis ("ABPA"). Our product candidates are based on our proprietary engineered dry powder delivery platform, iSPERSE<sup>™</sup>, which seeks to improve therapeutic delivery to the lungs by optimizing pharmacokinetics and reducing systemic side effects to improve patient outcomes.

We design and develop inhaled therapeutic products based on our proprietary dry powder delivery technology, iSPERSE<sup>™</sup>, which enables delivery of small or large molecule drugs to the lungs by inhalation for local or systemic applications. The iSPERSE<sup>™</sup> powders are engineered to be small, dense particles with highly efficient dispersibility and delivery to airways. iSPERSE<sup>™</sup> powders can be used with an array of dry powder inhaler technologies and can be formulated with a broad range of drug substances including small molecules and biologics. We believe the iSPERSE<sup>™</sup> dry powder technology offers enhanced drug loading and delivery efficiency that outperforms traditional lactose-blend inhaled dry powder therapies.

We were incorporated in 2013 as a Delaware corporation.

After a comprehensive review of strategic alternatives, including identifying and reviewing potential candidates for a strategic transaction, on November 13, 2024, we entered into the Agreement and Plan of Merger and Reorganization, as amended by Amendment No. 1 ("Amendment No. 1") thereto on April 7, 2025 (as amended by Amendment No. 1, the "Merger Agreement"), pursuant to which, among other matters, PCL Merger Sub, Inc., our direct wholly owned subsidiary, will merge with and into Cullgen Inc. ("Cullgen"), with Cullgen surviving as our wholly owned subsidiary and the surviving corporation of the merger (the "Merger"). The Merger Agreement was unanimously approved by our board of directors, which resolved to recommend approval of the Merger Agreement to our stockholders.

On June 16, 2025, we held a special meeting in lieu of the annual meeting of Pulmatrix stockholders, at which special meeting our stockholders approved the Merger and related proposals. The Closing is subject to other customary closing conditions, including Nasdaq's approval of the listing of the shares of Pulmatrix common stock to be issued in connection with the Merger and approval from the China Securities Regulatory Commission ("CSRC") pursuant to the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Enterprises (the "Trial Measures"), No. 1 to No. 6 Supporting Guidance Rules, the Notice on Administration Arrangements for the Filing of Overseas Listings by Domestic Enterprises and the relevant CSRC Answers to Reporter Questions on the official website of the CSRC. These regulations established a filing-based regime to regulate overseas offerings and listings by Chinese domestic companies. As of the date of this filing, we have not yet received approval from the CSRC to complete the Merger. As previously disclosed, on August 1, 2025, we and Cullgen, as provided for in the Merger Agreement, mutually agreed to extend the "End Date", a term defined in the Merger Agreement, by 60 days from August 13, 2025, to October 12, 2025. The Merger Agreement does not have a defined term and does not terminate on the "End Date". The "End Date" is simply the date at which certain termination options become available to either party.

On December 17, 2025, the Company, Cullgen and PLC Merger Sub, Inc. (collectively, the "Parties") entered into a mutual waiver agreement (the "Waiver Agreement"), pursuant to which the Parties agreed to mutually waive compliance with Section 5.4 of the Merger Agreement, which such provision imposes restrictions on each party during the Pre-Closing Period (as defined in the Merger Agreement). Except as expressly waived pursuant to the Waiver Agreement, the Merger Agreement continues to remain in full force and effect in all respects, and no other provision of the Merger Agreement has otherwise been amended, waived, or modified.

If the Merger is completed, the business of Cullgen will continue as the business of the combined company. We are currently seeking opportunities to monetize iSPERSE™ and our existing clinical assets.

Our future operations are highly dependent on the success of the Merger and there can be no assurances that the Merger will be successfully consummated. There can be no assurance that the strategic review process or any transaction relating to a specific asset, including the Merger and any asset sale, will result in us pursuing such a transaction, or that any transactions, if pursued, will be completed on terms favorable to us and our stockholders in the existing Pulmatrix entity or any possible entity that results from a combination of entities. If the strategic review process is unsuccessful, and if the Merger is not consummated, the Pulmatrix board of directors may decide to pursue a dissolution and liquidation of the Company.

*Business Strategy*

 

Our goal has been to develop breakthrough therapeutic products that are safe, convenient, and more effective than the existing therapeutic products for respiratory and other diseases where iSPERSE™ properties are advantageous.

Our current pipeline of clinical assets is aligned to this goal and includes iSPERSE™-based therapeutic candidates, which target the prevention and treatment of a range of diseases, including CNS disorders and pulmonary diseases. These therapeutic candidates include PUR3100 for the treatment of acute migraine, PUR1800 for the treatment of acute exacerbations of chronic obstructive pulmonary disease ("AECOPD"), and PUR1900 for the treatment of ABPA in patients with asthma and in patients with cystic fibrosis. Each program is enabled by its unique iSPERSE™ formulation designed to achieve specific therapeutic objectives.

In connection with the Merger, we are exploring opportunities to monetize these clinical assets and have paused the development of these product candidates. Continued development of these candidates, if that were to occur, would be contingent on securing additional funding and would require significant expenditures to advance. Thereafter, if development of such product candidates were to be continued and successfully advanced (of which there can be no assurance), it would be necessary to seek and obtain marketing approval to commercialize such product candidates, which could be expected to require the expenditure of significant additional resources and expenses related to regulatory, product sales, medical affairs, marketing, manufacturing and distribution.

Contingent on securing additional funding and continuing development of these candidates, we would expect to continue to incur substantial expenses and operating losses for at least the next several years, as we would:

● *Pursue further clinical studies for PUR3100, an orally inhaled dihydroergotamine ("DHE") including a Phase 2 clinical study for the treatment of acute migraine. We received Food and Drug Administration ("FDA") acceptance of our Investigational New Drug Application ("IND") and a "study may proceed" letter in September 2023, positioning PUR3100 as Phase 2-ready for potential financing or partnership discussions.* 

 We developed PUR3100, an iSPERSE™ formulation of DHE in 2020. We completed good laboratory practice ("GLP") toxicology studies in 2021 and 2022. In 2022, we completed a Phase 1 study designed as a double-blinded trial to assess the safety, tolerability, and pharmacokinetics of three dose levels of single doses of inhaled PUR3100 with intravenous ("IV") placebo, as compared to IV DHE (DHE mesylate injection) with inhaled placebo. On January 4, 2023, we announced the Phase 1 topline results, indicating that PUR3100 was safe and tolerated with fewer gastrointestinal side effects in all doses compared to IV DHE. PUR3100 showed a five-minute T<sub>max</sub> and C<sub>max</sub> within the targeted therapeutic range for all three doses tested. The Phase 1 study data was presented at the American Headache Society 65th Annual Meeting in June 2023. In May 2024, we announced a peer-reviewed publication of Phase 1 clinical results in the publication *Headache: The Journal of Head and Face Pain*.

 In September 2023, we announced the FDA's acceptance of an IND application for PUR3100 and receipt of a "study may proceed" letter for a Phase 2 study. The IND includes a Phase 2 clinical protocol where safety and preliminary efficacy of PUR3100 will be investigated in patients with acute migraine. Based on the rapid systemic exposure in the therapeutic range and the improved side effect profile relative to IV dosing, we believe the PUR3100 formulation of DHE may differentiate from approved DHE products or those in development. If effectiveness is demonstrated, PUR3100 may offer the convenience of being self-administered with a pharmacokinetic profile that may potentially provide rapid onset of action.

● *Pursue partnership or other alternatives to monetize or advance PUR1800, focusing on the development of an orally inhaled kinase inhibitor for treatment of AECOPD.* 

 We completed preclinical safety studies for PUR1800, our iSPERSE *<sup>™</sup>* formulation of RV1162, in 2018 and advanced our formulation and process development efforts to support clinical testing in stable moderate-severe COPD patients. We completed a Phase 1b safety, tolerability, and pharmacokinetics clinical study of PUR1800 for subjects with stable moderate-severe COPD and received topline data from the Phase 1b clinical study in the first quarter of 2022. We analyzed data from the completed Phase 1b clinical study of PUR1800 for AECOPD and presented study results at the American Academy of Allergy, Asthma & Immunology (AAAAI) conference in the first quarter of 2023. The results indicated PUR1800 was safe and well tolerated with no observed safety signals. The topline data, along with the results from chronic toxicology studies, support the continued development of PUR1800 for the treatment of AECOPD and other inflammatory respiratory diseases. In 2024, Pulmatrix published an abstract titled "Ex vivo evaluation of the potential for Narrow Spectrum Kinase inhibitors as a treatment for Idiopathic Pulmonary Fibrosis".

● *Capitalize on our proprietary iSPERSE™ technology and our expertise in inhaled therapeutics and particle engineering to identify new product candidates for prevention and treatment of diseases, including those with important unmet medical needs.* 

 To add additional inhaled therapeutics to our development pipeline and facilitate additional collaborations, we are leveraging our iSPERSE™ technology and our expertise in inhaled therapeutics and particle engineering to identify potential product candidates.

● *Invest in protecting and expanding our intellectual property portfolio and file for additional patents to strengthen our intellectual property rights.* 

 The status of our patent portfolio changes frequently in the ordinary course of patent prosecution. As of December 31, 2025, our patent portfolio related to iSPERSE *<sup>™</sup>* included approximately 149 granted patents, 18 of which are granted US patents, with expiration dates from 2026 to 2043, and approximately 48 additional pending patent applications in the US and other jurisdictions. Our in-licensed portfolio related to kinase inhibitors included approximately 284 granted patents, 33 of which are granted US patents, with expiration dates from 2029 to 2035, and approximately 11 additional pending patent applications in the US and other jurisdictions. We have national phase applications pending in Australia, Brazil, Canada, China, Europe, Israel, India, Japan, Korea, Mexico, New Zealand, Russia, Hong Kong and the United States that cover certain formulations and methods of use relevant to our PUR3100 program.

● *Seek partnerships and license agreements to support the product development and commercialization of our product candidates.* 

 In order to advance our clinical programs, we may seek partners or licensees in areas of pharmaceutical and clinical development.

*iSPERSE<sup>™</sup> Technology*

We use simple, safe excipients, including proprietary cationic salt formulations, to create a robust and flexible dry powder platform technology that can accommodate a wide range of drug loads in highly dispersible particles. Our initial delivery platform emerged from development of iCALM<sup>™</sup> (inhaled Cationic Airway Lining Modulators), a non-steroidal anti-inflammatory therapy. The high degree of aerosol efficiency and the density profile of our dry powder iCALM<sup>™</sup> formulations provided the foundation for our development of iSPERSE*<sup>™</sup>* in 2012, which uses other monovalent and divalent salts.

iSPERSE*<sup>™</sup>* particles are engineered with a small, dense and dispersible profile to exceed the performance of traditional dry powder particles as the iSPERSE*<sup>™</sup>* particles have the dispersibility advantages of porous engineered particles. We believe this results in superior drug delivery compared to traditional oral and injectable forms of treatment for certain diseases. Unlike lactose-blended carrier formulations or low-density particles which disperse poorly, we believe that the iSPERSE*<sup>™</sup>* technology platform offers several potential benefits, achieved through the following technological innovations:

● *Flexible drug loading for delivery of a single microgram to tens of milligrams per dose*.

iSPERSE*<sup>™</sup>* particles can be engineered to include concentrations from less than one percent (1%) to greater than eighty percent (80%) active pharmaceutical ingredients ("APIs"), which allows flexibility for dosing both high potency and high-drug load therapeutics.

● *Superior flow rate independent lung delivery without carriers*.

The iSPERSE*<sup>™</sup>* technology enables pulmonary delivery independent of lactose or other carriers, which results in significantly greater lung dose at a matched nominal dose of conventional lactose-based formulations. iSPERSE*<sup>™</sup>* formulations are dispersible across a range of flow rates with consistent emitted dose and particle size. Performance across flow rates provides reliable dose delivery across patient populations and reduces patient-to-patient variability.

● *Delivery of macromolecules and biologics*.

iSPERSE*<sup>™</sup>* powders can be used with an array of dry powder inhaler technologies and can be formulated with a broad range of therapeutic compounds ranging from small molecules to proteins for both local and systemic drug delivery applications.

● *Homogenous combinations of multiple drugs*.

iSPERSE*<sup>™</sup>* creates homogenous particles including excipients and API, which allow for the consistent delivery of multiple APIs in a product. We have successfully formulated iSPERSE*<sup>™</sup>*-based products with dual and triple API combinations.

● *Strong safety profile*.

Current iSPERSE*<sup>™</sup>* products and planned clinical-stage products to be formulated in iSPERSE*<sup>™</sup>* are supported by robust preclinical safety profiles. iSPERSE*<sup>™</sup>* excipients include those with inhalation precedent and those that are generally regarded as safe by other routes of administration.

**Therapeutic Candidates**

***PUR3100***

PUR3100 is still an investigational drug candidate and not authorized for commercialization, but we are currently exploring other opportunities to monetize PUR3100.

In 2020, we developed PUR3100, the iSPERSE<sup>™</sup> formulation of DHE, for the treatment of acute migraine. Currently DHE is only available as subcutaneous, intravenous infusion or intranasal delivery. If approved for commercialization, PUR3100 has the opportunity to be the first orally inhaled DHE treatment for acute migraine and an alternative to other acute therapies. Given the oral inhaled route of delivery, PUR3100 is anticipated to provide rapid relief from migraine symptoms and provide a favorable tolerability profile.

 

*Competition and Market Opportunities*

The American Migraine Foundation estimates that at least 39 million people in the United States and 1 billion people worldwide live with migraine, but because many people are not diagnosed or do not receive the treatment they need, the actual number may be higher. Current treatments for migraine include oral, intranasal, IV or subcutaneous formulations of triptans, DHE, and calcitonin gene-related peptide ("CGRP") antagonists (gepants). Studies show that people with migraines are underdiagnosed, undertreated, and experience substantial decreases in functioning and productivity, which translates into diminished quality of life for individuals and financial burdens to patients, healthcare systems, and employers. All current treatments are limited by incomplete efficacy and/or intolerability. Therefore, development of additional treatments for acute migraine is warranted.

DHE has been shown to be effective in the treatment of migraine and, in particular, hard to treat migraines, such as menstrual migraine, migraine upon awakening, and severe migraine. Utilization of DHE has been limited due to its poor oral bioavailability, requiring IV, subcutaneous or intranasal dosing. IV dosing generally requires administration in a healthcare setting and may result in nausea and vomiting. Hence, its use has generally been limited to patients with intractable or medication-overuse migraine. In May 2025, the FDA approved Brekiya (Amneal Pharmaceuticals, Inc.), a subcutaneous DHE autoinjector for acute treatment of migraine with or without aura and cluster headaches in adults. Intranasal dosing with DHE, including Migranal (Bausch Health US LLC), approved in December 1997, and Trudhesa (Impel NeuroPharma, Inc.), approved by the FDA in September 2021, have been poorly adopted due to incomplete efficacy and intolerability of nasal inhalation in patients during a migraine.

There is precedent for an orally inhaled DHE therapy. MAP Pharmaceuticals, Inc. developed MAP0004, also known as Levadex or Semprana, a liquid suspension formulation of DHE, designed to be dosed via a breath-actuated pMDI inhalation device. Their published data indicate a safe and well tolerated formulation with rapid onset and long-lasting efficacy that compared favorably to existing treatments. Development of MAP0004 led to a new drug application ("NDA") but was halted after multiple complete response letters from the FDA citing Chemistry, Manufacturing and Controls ("CMC") issues related to dose uniformity and stability issues. Regardless of the failure of MAP0004, the efficacy and tolerability of the formulation reported by MAP Pharmaceuticals provides proof of concept for an orally inhaled DHE formulation. PUR3100, the iSPERSE*<sup>™</sup>* formulation planned by Pulmatrix, is anticipated to deliver DHE to the lung with efficacy and tolerability that compares favorably with MAP0004, while avoiding the device-related issues of MAP0004 by delivering PUR3100 as an iSPERSE*<sup>™</sup>* dry powder.

We believe that an iSPERSE formulation of DHE can provide the positive rapid onset and long-lasting efficacy seen in the MAP0004 data by enabling a similar pharmacokinetic profile while eliminating the manufacturing and device issues which led to the MAP0004 FDA complete response letters.

Aspeya, Inc. ("Aspeya"), a subsidiary of Philip Morris International, Inc. and formerly known as Vectura Fertin Pharma, Inc., is developing a drug-device combination product for the pulmonary delivery of an inhaled dry-powder formulation of DHE for the acute treatment of migraines in adults. Aspeya completed a Phase 1 clinical trial in New Zealand in 2024, later announcing the treatment was assessed safe, well-tolerated and supporting further clinical development. Aspeya later completed a Phase 1 clinical trial in 2025 (NCT07226362), with results pending. To the best of our knowledge, there are no other orally inhaled DHE formulations currently in development or on the market.

Migranal, Trudhesa and Atzumi are currently FDA approved intranasal formulations of DHE. While Migranal and Trudhesa are nasal liquid sprays, Atzumi is a nasal powder formulation. Satsuma Pharmaceuticals, a subsidiary of Shin Nippon Biomedical Laboratories ("Satsuma"), gained FDA approval during 2025 for Atzumi for acute treatment of migraine.

*Non-Clinical Development*

A total of three 14-day GLP toxicology studies have been completed with PUR3100 to support single-dose clinical studies. We are planning to conduct a chronic toxicology study to support long-term dosing. Based on discussions with the FDA, this would complete the non-clinical requirements to support an NDA.

*Clinical Development*

All U.S. clinical development is currently on hold while we work to license or monetize this asset.

Our interactions with the FDA have indicated that, as part of Phase 2 and Phase 3 studies, long-term safety should be assessed in a minimum of one hundred patients for six months of dosing and fifty patients for twelve months of dosing. The FDA also confirmed that it will be necessary to perform a safety study administering PUR3100 to otherwise healthy patients with asthma before an NDA is submitted.

On September 26, 2022, we announced the completion of patient dosing in a Phase 1 clinical study, performed in Australia. The study design was a double-dummy, double-blinded trial to assess the safety, tolerability, and pharmacokinetics of three dose levels of single doses of inhaled PUR3100 with IV placebo, as compared to IV DHE (DHE mesylate injection) with inhaled placebo. This study may also provide preliminary comparative bioavailability data to support the use of the 505(b)(2) pathway for marketing authorization. Twenty-six healthy subjects were enrolled and each of the four groups contained at least six subjects.

On January 4, 2023, we announced topline results. We presented the Phase 1 study data at the American Headache Society 65th Annual Meeting in June 2023. The study showed that PUR3100 achieved peak exposures in the targeted therapeutic range and time to maximum concentration occurred at five minutes after dosing at all dosing levels. The PUR3100 dose groups also showed a lower incidence of nausea and no vomiting compared to observations of nausea and vomiting in the IV administered DHE dose group.

Based on the rapid systemic exposure in the therapeutic range and the improved side effect profile relative to IV dosing, we believe the PUR3100 formulation of DHE may differentiate from approved DHE products or those known to be in development. If effectiveness is demonstrated, PUR3100 may offer the convenience of being self-administered with a pharmacokinetic profile that may potentially provide rapid onset of action.

In September 2023, we announced that the FDA accepted the PUR3100 IND and the receipt of a "study may proceed" letter for the clinical study: "A Phase 2, Multicenter, Randomized, Double-Blind, Placebo-Controlled, Single Event Study to Evaluate the Safety, Tolerability, and Efficacy of PUR3100 (Dihydroergotamine Mesylate Inhalation Powder) in the Acute Treatment of Migraine". We anticipate that this Phase 2 clinical study will initiate once financing or partnership arrangements have been made.

On May 15, 2024, we announced publication of, "Safety, tolerability, and pharmacokinetics of a single orally inhaled dose of PUR3100, a dry powder formulation of dihydroergotamine versus intravenous dihydroergotamine: A Phase 1 randomized, double-blind study in healthy adults" in the peer-reviewed publication *Headache: The Journal of Head and Face Pain*.

We believe that in this trial, PUR3100 demonstrated the potential for rapid pain relief and improved DHE tolerability versus IV DHE. With a T<sub>max</sub> of 5 minutes and a C<sub>max</sub> in the therapeutic window for all doses tested, we believe that PUR3100 has the potential to address an unmet need for acute migraine sufferers and we are pursuing different options to advance PUR3100 into a Phase 2 clinical trial to further investigate its promising profile in treating acute migraine.

The completed Phase 1 study demonstrated optimal pharmacokinetics and improved tolerability of PUR3100 compared to IV DHE. All doses of PUR3100 were generally well tolerated with a lower incidence of nausea (21% vs. 86%), vomiting (0% vs. 29%), and headache (16% vs. 57%) compared to IV DHE. The PK profile of PUR3100 versus IV DHE was characterized by a similar mean time to C<sub>max</sub> (5 vs. 5.5 min), with reduced AUC<sub>0–2h</sub> (1120–4320 vs. 6340 ng\*h/mL), and a lower C<sub>max</sub> (3620–14,400 vs. 45,000 ng/mL). All doses of PUR3100 were associated with mean C<sub>max</sub> above the minimum level required to achieve efficacy (1000 pg/mL).

***PUR1800***

PUR1800 is still an investigational drug candidate and not authorized for commercialization, but we are currently exploring other opportunities to monetize PUR1800.

PUR1800 is a Narrow Spectrum Kinase Inhibitor, engineered with our iSPERSE<sup>™</sup> technology, with a target indication for the treatment of acute exacerbations in chronic obstructive pulmonary disease (AECOPD). PUR1800 targets p38 MAP kinases (p38MAPK), Src kinases, and Syk kinases. These kinases play a critical role in chronic inflammation and airway remodeling.

Reduced responsiveness to corticosteroids represents an important barrier to effective treatment of COPD and AECOPD and provides a clear rationale to seek novel medicines to treat these respiratory diseases. In addition, current treatments generally fail to treat the underlying source of the AECOPD, in particular when a viral or bacterial infection is the cause, which occurs in approximately 80% of exacerbations. RV1162, the active ingredient of PUR1800, is a novel, potent anti-inflammatory that inhibits the phosphorylation of a narrow spectrum of kinases. In pre-clinical studies, RV1162 demonstrated direct anti-inflammatory activity in a model of viral induced respiratory inflammation. RV1162 also demonstrated a reduction in corticosteroid-resistant inflammatory responses in a model of cigarette smoke induced inflammation. These findings suggested that RV1162 has the potential to deliver effective anti-inflammatory outcomes in corticosteroid-resistant patients while also reducing the underlying source of inflammation in an exacerbation, such as a viral and/or bacterial respiratory infection.

Clinical studies conducted by RespiVert/Janssen with RV1162 formulated as a lactose blend for inhalation demonstrated that the molecule was well tolerated for up to 14 days of dosing in patients with COPD. Analysis of sputum collected from patients with COPD treated with RV1162 showed reduced levels of p38 phosphorylation in sputum cells and decreases in the number of neutrophils recovered in sputum after 12 days of dosing. These findings suggest that inhalation of RV1162 may confer anti-inflammatory benefits after a short dosing regimen. Long-term toxicology studies with RV1162 as a lactose blend suggested that this formulation was not suitable for chronic dosing.

Based upon the clinical results generated by RespiVert/Janssen for RV1162 and the anticipated benefits of an iSPERSE*<sup>™</sup>* formulation of RV1162, we entered into a License, Development and Commercialization Agreement with RespiVert Ltd. ("RespiVert"), a wholly owned subsidiary of Janssen Biotech, Inc. on June 9, 2017. RespiVert granted us an exclusive, royalty-bearing license in a portfolio of narrow spectrum kinase inhibitor compounds ("NSKI"). We subsequently formulated RV1162 into PUR1800 for development as a potential therapy for AECOPD. In January 2026, we provided RespiVert notice that, pursuant to our agreement, we are exercising our option to abandon the prosecution of certain individual RespiVert patents. We do not consider these patents to be necessary to support PUR1800 at this time.

*Competition and Market Opportunities*

 

There are 18 million moderate-to-severe episodes of AECOPD in the US each year. AECOPD are sudden onset increases in symptoms, including increased dyspnea, sputum purulence and volume, and wheezing, coughing, and shortness of breath that require medical intervention and can lead to hospitalization. The occurrence of an exacerbation greatly increases the likelihood of a further exacerbation within the following 6 months and creates a significant financial burden to healthcare systems.

Steroids are standard of care for moderate-to-severe acute exacerbations, which occur across all patient severity types. We believe a substantial unmet need exists in AECOPD for those patients with underlying infection and/or steroid resistance. Acumapimod (BCT-197) is an oral p38 MAP kinase inhibitor being developed by Mereo BioPharma. BCT-197 completed Phase 2 development as first-line therapy for severe AECOPD. In April 2019, Mereo BioPharma announced completion of an end of Phase 2 meeting with the FDA and stated the company is continuing discussions with potential partners for BCT-197. We are not aware of any further progress in either clinical development or partnership efforts on this product. A generic version of roflumilast, a phosphodiesterase inhibitor approved by the FDA for use in managing COPD exacerbations, became available in 2022.

*Non-Clinical Development*

We conducted two 28-day GLP toxicology studies in rats and dogs. Results from the two GLP toxicology studies supported the potential for PUR1800 to improve lung exposure, with reduced lung accumulation, as compared to RV1162 as a lactose blend formulation, suggesting potential for chronic dosing.

Toxicology studies in rats and dogs, with durations of six and nine months respectively, are complete. The data from both studies demonstrated that PUR1800 is safe and well tolerated with chronic dosing, with little to no progression of findings from 28-day studies. We believe that this indicates potential for chronic dosing of PUR1800, enabling us to explore PUR1800 therapy for chronic respiratory diseases such as steroid resistant asthma, COPD, or idiopathic pulmonary fibrosis. While the program is currently in development for treatment of acute exacerbation of COPD, these positive toxicology study results could expand potential indications and value of the program. In 2024, Pulmatrix published an abstract titled "Ex vivo evaluation of the potential for Narrow Spectrum Kinase inhibitors as a treatment for Idiopathic Pulmonary Fibrosis".

*Clinical Development*

All clinical development is currently on hold while we work to license or monetize this asset.

We completed a Phase 1b safety, tolerability, and pharmacokinetics of PUR1800 in patients with stable moderate-severe COPD. Topline data were delivered in the first quarter of 2022 and presented at the American Academy of Allergy, Asthma and Immunology conference in the first quarter of 2023.

The clinical study, performed at the Medicines Evaluation Unit in Manchester, UK, was a randomized, three-way crossover double-blind study with 14 days of daily dosing, which included placebo and one of two doses of PUR1800, and included a 28-day follow-up period after each treatment period. A total of 18 adults with stable COPD were enrolled. Safety and tolerability, as well as systemic pharmacokinetics ("PK") were evaluated.

PUR1800 was well tolerated and there were no observed safety signals. The PK data indicate that PUR1800 results in low and consistent systemic exposure when administered via oral inhalation. The topline data, along with the results from chronic toxicology studies, support the continued development of PUR1800 for the treatment of AECOPD and other inflammatory respiratory diseases. These data will inform the design of a potential Phase 2 study in the treatment of AECOPD.

***PUR1900***

PUR1900 is still an investigational drug candidate and not authorized for commercialization, but we are currently exploring other opportunities to monetize PUR1900 within the United States.

PUR1900 is our iSPERSE<sup>™</sup> inhaled formulation of itraconazole, an antifungal drug commercially available as an oral drug. We developed PUR1900 for the prevention and potential treatment of fungal infections and allergic/hypersensitivity reactions to fungus in patients with severe lung disease, including those with asthma and CF. On January 28, 2020, PUR1900 received Fast Track designation from the FDA for the treatment of ABPA. *Aspergillus* colonization and infections are likely underdiagnosed and occur frequently in patients of all ages. Colonization and infection with *Aspergillus* can lead to clinical disease with differing severities and complications depending on the immune status of the host. Invasive aspergillosis is a frequently fatal disease that occurs in patients that are typically immune suppressed as a result of treatment for hematologic cancers or immunosuppression prior to solid organ transplantation. In patients with asthma and CF, *Aspergillus* can cause chronic infections that may be associated with worsening disease and larger declines in lung function than patients without infection. A subset of patients with asthma and CF with *Aspergillus* colonization and/or infection develop ABPA, which is a complex hypersensitivity reaction to fungal antigens. ABPA is a disease resulting in mucus production, wheezing, pulmonary infiltrates, worsening bronchiectasis, and fibrosis of the lung.

In patients with both asthma and CF, ABPA is commonly treated with oral steroids to treat inflammation and with oral antifungals to reduce fungal infection. The inhalation administration of a drug affords direct delivery of the drug to the infected parts of the lung, maximizing the dose to the affected sites and minimizing systemic exposure to the rest of the body where it could cause dose-limiting side effects. Therefore, treatment of lung infections by direct administration of anti-infective products to the lung may improve both the safety and efficacy of treatment compared to systemic administration by other routes, as well as improving patient convenience as compared to oral and injectable forms of the treatment. We believe that local lung delivery by inhalation of our iSPERSE*<sup>™</sup>* formulation could provide convenient, effective and safe management of the debilitating and often life-threatening lung infections that are not currently addressed by inhaled therapies.

*Competition and Market Opportunities*

Current treatments of pulmonary fungal infections highlight the limitations of oral or intravenous anti-infective treatments for lung infections. Itraconazole is one of the most commonly prescribed therapies for treating *Aspergillus* infections in patients with asthma and CF. Itraconazole is available commercially as Sporanox<sup>®</sup> in both a capsule and oral solution form. Itraconazole is metabolized in the liver by CYP3A4 and coadministration with a large number of drugs is contraindicated due to the potential for severe drug-drug interactions.

We have demonstrated that PUR1900 achieves higher local lung itraconazole concentrations with lower systemic exposure relative to oral dosing, thus allowing for the potential to improve upon both the efficacy and safety profiles observed with oral itraconazole. Furthermore, administration by inhalation reduces the exposure of the drug in the rest of the body, which may be beneficial in reducing systemic side effects and the risk of potentially toxic drug-drug interactions.

There is precedent for both dry powder and nebulized inhaled anti-infective therapy to address specific pulmonary infections in patients which demonstrates potential utility of inhaled drug delivery and market opportunity. Mylan currently markets TOBI Podhaler for treatment of *Pseudomonas aeruginosa* infection in the United States and Teva markets inhaled colistin, Colobreathe, for the same infection in Europe. Insmed currently markets Amikacin Liposome Inhalation Suspension (Arikayce) in the United States for the treatment of lung disease caused by a group of bacteria, *Mycobacterium avium complex* in a limited population of patients with the disease who do not respond to conventional treatment (refractory disease). There are currently no products specifically approved for treatment of ABPA, however, there are several inhaled antifungal agents currently under development for the treatment of invasive aspergillosis or ABPA. Treatments under development for invasive aspergillosis include PC945, a novel azole antifungal being developed by Pulmocide as a liquid for nebulization prior to the termination of their Opera-T Phase 3 study with Opelconazole based on an interim analysis data. In addition, a dry powder formulation of voriconazole was previously being developed by TFF Pharmaceuticals prior to announcing dissolution in 2025. In principle, development of an orally inhaled antifungal for the treatment of invasive aspergillosis could also be effective for ABPA but would require additional clinical studies in the target patient population. Zambon has also developed a dry powder formulation of voriconazole for the treatment of ABPA and completed a Phase 1 study in the third quarter of 2020. However, no additional development has since been reported. Regeneron Pharmaceuticals completed a clinical trial in 2024 with dupilumab (NCT04442269) for the treatment of ABPA in asthma. This trial focused on prevention of exacerbations in individuals with at least one or more severe respiratory exacerbations. In 2025, Regeneron announced dupilumab significantly improved lung function and substantially reduced severe exacerbations while enhancing quality of life in patients with ABPA during the treatment period.

New methods to detect *Aspergillus* infection in sputum have improved the sensitivity of diagnosis and clinical appreciation for these infections. Pulmonary *Aspergillus* infections affect approximately 14 million patients worldwide according to the Global Action Fund for Fungal Infections (Improving Outcomes for Patients with Fungal Infections across the World: A Road Map for the Next Decade). The majority of these cases occur in patients with asthma who have allergic disease and also include invasive *Aspergillus* infections that are associated with a high rate of mortality in immunocompromised patients. We believe that PUR1900 compares favorably to the products discussed above and has the potential to generate substantial value based on treating and preventing pulmonary fungal infections in multiple patient populations.

*Clinical Development*

All clinical development is currently on hold while our partner, Cipla, has completed a Phase 2 trial and is approved to proceed to a Phase 3 trial, both in India.

We completed a Phase 1/1b clinical study in 2018, wherein PUR1900 appeared to be safe and well tolerated in healthy normal volunteers (Parts 1 and 2) and in patients with asthma (Part 3). In Part 3 of the Phase 1/1b clinical study, following a single dose of PUR1900, the pharmacokinetics ("PK") analysis of sputum samples demonstrated approximately 70-fold higher maximum lung concentration of itraconazole following inhalation of PUR1900 compared to oral Sporanox<sup>®</sup> (Janssen Pharmaceuticals) despite inhaling only one-tenth the dose of itraconazole (20 mg) relative to the dose of oral Sporanox<sup>®</sup> (200 mg). Lung exposure, as measured by sputum induction and analysis, was approximately 50-fold higher and plasma exposure was approximately 85-fold lower following inhalation of 20 mg of PUR1900 compared to 200 mg of oral Sporanox<sup>®</sup>**.** All endpoints from the Phase 1/1b clinical study were successfully met.

Successful completion of the Phase 1/1b clinical study enabled us to initiate a Phase 2 clinical study in 2019, entitled: "A Randomized, Double-Blind, Multicenter, Placebo-Controlled, Phase 2 Study to Evaluate the Safety, Tolerability, and Pharmacokinetics of Itraconazole Administered as a Dry Powder for Inhalation (PUR1900) in Adult Asthmatic Patients with ABPA." This clinical study was terminated in July 2020 due to the impact of the COVID-19 pandemic on patient enrollment and clinical study conduct. The completion of a 6-month inhalation toxicology study in dogs in 2020 enabled the conduct of a new Phase 2b clinical study.

The new Phase 2b study included a 16-week dosing regimen and exploration of potential regulatory approval endpoints. We dosed the first patient during the first quarter of 2023. In January 2024, pursuant to the Third Amendment (as defined herein), we announced plans to stop patient enrollment at 8 subjects in this study, effective immediately, and to terminate the study as soon as reasonably possible between the date of the Third Amendment and July 30, 2024. We completed all Phase 2b wind down activities in the third quarter of 2024. As such, we no longer bear further financial responsibility for the commercialization and development with respect to the Product in the Cipla Territory, with such commercialization and development expenses of the Product in the Cipla Territory to be borne at Cipla's sole cost and expense after January 6, 2024.

**Business Development**

*PUR3100*

We are currently exploring opportunities to monetize PUR3100.

In September 2023, we announced the FDA's acceptance of an IND application for PUR3100 and receipt of a "study may proceed" letter for a Phase 2 study. The IND includes a Phase 2 clinical protocol where safety and preliminary efficacy of PUR3100 will be investigated in patients with acute migraine.

*PUR1800*

 

We are currently exploring opportunities to monetize PUR1800.

We completed a Phase 1b safety, tolerability, and pharmacokinetics clinical study of PUR1800 for subjects with stable moderate-severe COPD and received topline data from the Phase 1b clinical study in the first quarter of 2022. We analyzed data from the completed Phase 1b clinical study of PUR1800 for AECOPD and presented study results at the American Academy of Allergy, Asthma & Immunology (AAAAI) conference in the first quarter of 2023. The results indicated PUR1800 was safe and well tolerated with no observed safety signals. The topline data, along with the results from chronic toxicology studies, support the continued development of PUR1800 for the treatment of AECOPD and other inflammatory respiratory diseases.

*PUR1900*

We are currently exploring opportunities to monetize PUR1900 within the United States.

On April 15, 2019, we entered into a Development and Commercialization Agreement (the "Cipla Agreement") with Cipla for the co-development and commercialization, on a worldwide, except for the Cipla Territory defined below, exclusive basis, of PUR1900, our inhaled iSPERSE*<sup>™</sup>* drug delivery system (the "Product") enabled formulation of the antifungal drug itraconazole, which is only available as an oral drug, for the treatment of all pulmonary indications, including ABPA in patients with asthma. We entered into an amendment to the Cipla Agreement on November 8, 2021 (the "Second Amendment") and a subsequent amendment on January 6, 2024 (the "Third Amendment"). All references to the Cipla Agreement herein refer to the Cipla Agreement, as amended. The Cipla Agreement will remain in effect in perpetuity, unless otherwise earlier terminated in accordance with its terms.

Pursuant to the Third Amendment, all development and commercialization activities with respect to the Product in all markets other than the United States (the "Cipla Territory") will be conducted exclusively by Cipla at Cipla's sole cost and expense, and Cipla shall be entitled to all profits from the sale of the Product in the Cipla Territory, except that we will receive 2% royalties on any potential future net sales by Cipla outside the United States.

Also pursuant to the Third Amendment, we and Cipla stopped patient enrollment for the ongoing Phase 2b clinical study. We agreed that during the period commencing on January 6, 2024 and ending July 30, 2024 (the "Wind Down Period"), we would complete all Phase 2b activities, assign or license all patents to Cipla and their registration with the appropriate authorities in the Cipla Territory, complete a physical and demonstrable technology transfer and secure all data from the Phase 2b study for inclusion in the safety database for the Cipla Territory.

For the duration of the Wind Down Period, we and Cipla were each responsible for 60% and 40%, respectively, of our Direct Costs. We shared all other development costs with Cipla that are not Direct Costs, such as the cost of clinical research organizations, manufacturing costs and other third-party costs, on a 50/50 basis. Reimbursements from Cipla to us for these costs were subject to a maximum reimbursement amount as approved by the joint steering committee.

We completed all Phase 2b wind down activities in the third quarter of 2024. As such, we no longer bear further financial responsibility for the commercialization and development with respect to the Product in the Cipla Territory, with such commercialization and development expenses of the Product in the Cipla Territory to be borne at Cipla's sole cost and expense after January 6, 2024.

Our partner Cipla has continued clinical development outside the United States and India's Central Drug Standard Control Organization has accepted Cipla's Phase 2 clinical trial results for inhaled itraconazole dry powder formulation and approved the company's proposal to proceed with Phase 3 trials. Should Cipla successfully market PUR1900 outside the United States, Pulmatrix will receive 2% royalties on any potential future net sales by Cipla outside the United States. Within the United States, we and Cipla will seek to monetize PUR1900 for indications where an orally inhaled antifungal may provide a therapeutic benefit or fulfill an unmet medical need.

**Intellectual Property**

*Patents and Patent Applications*

We protect our intellectual property by filing and advancing patent applications and maintaining granted patents on our iSPERSE*<sup>™</sup>* platform technology and in-licensed kinase inhibitors, which includes claims to compositions of matter and methods of use for our PUR3100, PUR1800, PUR1900 and other programs, as well as manufacturing processes, devices and packaging relevant to our iSPERSE*<sup>™</sup>* platform and product candidates.

The status of our patent portfolio changes frequently in the ordinary course of patent prosecution. As of December 31, 2025, our patent portfolio related to iSPERSE*<sup>™</sup>* included approximately 149 granted patents, 18 of which are granted US patents, with expiration dates from 2026 to 2043, and approximately 48 additional pending patent applications in the US and other jurisdictions. Our in-licensed portfolio related to kinase inhibitors included approximately 284 granted patents, 33 of which are granted US patents, with expiration dates from 2029 to 2035, and approximately 11 additional pending patent applications in the US and other jurisdictions. We have national phase applications pending in Australia, Brazil, Canada, China, Europe, Israel, India, Japan, Korea, Mexico, New Zealand, Russia, Hong Kong and the United States that cover certain formulations and methods of use relevant to our PUR3100 program.

There can be no assurance that the patent applications will be granted. The term of individual patents depends upon the legal term of the patents in the countries in which they are obtained. In most countries in which we file, the patent term is 20 years from the earliest date of filing a non-provisional patent application. In the United States, the patent term of a patent that covers a FDA-approved drug may also be eligible for patent term extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory review process. The length of the patent term extension is related to the length of time the drug is under regulatory review. Patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval and only one patent applicable to an approved drug may be extended. In the future, if and when our products receive FDA approval, we expect to apply for patent term extensions on patents covering those products. Similar provisions are available in Europe and other foreign jurisdictions to extend the term of a patent that covers an approved drug. We plan to seek patent term extensions to extend the patent coverage of any of our products that received regulatory approval in any jurisdiction where these extensions are available. However, there is no guarantee that the applicable authorities, including the FDA in the United States, will agree with our assessment on whether such extensions should be granted, and if granted, the length of such extensions.

The patent positions of biotechnology companies like ours are generally uncertain and involve complex legal, scientific and factual questions. In addition, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted after issuance. Consequently, we may not obtain or maintain adequate patent protection for any of our product candidates. We cannot predict whether the patent applications we are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from competitors. Any patents that we hold may be challenged, circumvented or invalidated by third parties.

*Trade Secrets*

We also rely on trade secret protection of our confidential and proprietary information, including the iSPERSE*<sup>™</sup>* technology. Although we take steps to protect our proprietary information and trade secrets, including through contractual means with our employees, consultants and others, third parties may independently develop substantially equivalent proprietary information and techniques or otherwise gain access to our trade secrets or disclose our technology. Thus, we may not be able to meaningfully protect our trade secrets. It is our policy to require our employees, consultants, outside scientific collaborators, sponsored researchers and other advisors to execute confidentiality agreements upon the commencement of employment or consulting relationships with us. These confidentiality agreements provide that all confidential information concerning our business or financial affairs developed or made known to the individual during the course of the individual's relationship with us must be kept confidential and not disclosed to third parties except in specific circumstances. Our confidentiality agreements with our employees also provide that all inventions conceived by the employee in the course of employment with us or from the employee's use of our confidential information are our exclusive property.

**Manufacturing**

We do not currently own or operate manufacturing facilities for the production of clinical or commercial quantities of our product candidates. We have historically maintained small-scale production capabilities and performed early process development for our product candidates to produce the quantities necessary to conduct preclinical studies of our investigational product candidates. We do not have, and do not currently plan to acquire or develop, the facilities or capabilities to manufacture bulk drug substance or drug product for use in human clinical studies. We rely on contract manufacturing organizations ("CMOs") and third-party contractors to manufacture drug substance and drug product required for our clinical studies. We expect to continue to rely on CMOs to manufacture drug substances and drug products under the appropriate current Good Manufacturing Practices ("cGMP") conditions to perform clinical studies for the foreseeable future. We also contract with CMOs for the labeling, packaging, storage and distribution of investigational drug products. These arrangements allow us to maintain a more flexible infrastructure while focusing our expertise on researching and developing our products.

We expect to continue to rely on contract manufacturers to produce sufficient quantities of our product candidates in accordance with the appropriate cGMPs for the pertinent phase of clinical trials. cGMP compliance includes strict adherence to regulations for quality control, quality assurance, and the maintenance of records and documentation. The manufacturing facilities that manufacture our approved drug products, if any are approved in the future, must comply with the FDA's cGMP regulation requirements and have acquired FDA or other regulatory approval for the manufacturing of our commercial products. Our contract manufacturers may also be subject to inspections of facilities by regulatory authorities to ensure compliance with applicable regulations. Contract manufacturers often encounter difficulties involving production yields, quality control and quality assurance, as well as shortages of qualified personnel. We have little or no direct control over our manufacturers' compliance with these regulations and standards. Failure to comply with applicable regulatory requirements may result in fines and civil penalties, suspension of production, suspension or delay in product approval, product seizure or recall, or withdrawal of product approval. These actions could have a material impact on the availability of products.

**Suppliers**

We also have relied on third-party contract manufacturers to supply the APIs that are used to formulate our therapeutic candidates. When needed, we place purchase orders with different contract manufacturers for the APIs required for PUR3100, PUR1800 and PUR1900. We additionally have relied on third-party vendors to supply raw materials for our APIs and drug products.

**Research and Development**

For fiscal years ended December 31, 2025 and 2024, we spent approximately less than $0.1 million and $7.2 million, respectively, on research and development activities.

**Government Regulation**

Pharmaceutical companies are subject to extensive regulation by national, state and local agencies, such as the FDA, in the United States and the European Medicines Agency in Europe. The manufacture, distribution, marketing, and sale of pharmaceutical products are subject to government regulation in the United States and various foreign countries. Additionally, in the United States, we must follow rules and regulations established by the FDA requiring the presentation of data indicating that our products are safe and efficacious and are manufactured in accordance with cGMP regulations. If we do not comply with applicable requirements, we may be fined, the government may refuse to approve our marketing applications or allow us to manufacture or market its products, and we may be criminally prosecuted. We and our manufacturers and clinical research organizations may also be subject to regulations under other federal, state and local laws, including, but not limited to, the U.S. Occupational Safety and Health Act, the Resource Conservation and Recovery Act, the Clean Air Act and import, export and customs regulations as well as the laws and regulations of other countries. Pharmaceutical companies must ensure their compliance with the Foreign Corrupt Practices Act and federal healthcare fraud and abuse laws, including the False Claims Act, and the U.S. government has increased its enforcement activity regarding illegal marketing practices domestically and internationally.

These regulatory requirements impact our operations and differ from one country to another, such that securing the applicable regulatory approvals of one country does not imply the approval of another country. However, securing the approval of a more stringent body, e.g., the FDA, may facilitate receiving the approval by a regulatory authority in a different country where the regulatory requirements are similar or less stringent. The approval procedures involve high costs and are manpower intensive and usually extend over many years and require highly skilled and professional resources.

*FDA Approval Process*

The steps required to be taken before a new drug may be marketed in the United States generally include:

● Completion of preclinical laboratory and animal testing;

● The submission to the FDA of an IND application, which must be evaluated, for safety and quality of scientific evaluation, and found acceptable by the FDA before human clinical trials may commence;

● Performance of adequate and well-controlled human clinical trials in accordance with the protocols described in the accepted IND, as well as FDA's IND regulations to establish the safety and efficacy of the proposed drug for its intended use; and

● Submission and approval of an NDA.

Clinical studies are conducted under protocols detailing, among other things, the objectives of the study, what types of patients may enter the study, schedules of tests and procedures, drugs, dosages, and length of study, as well as the parameters to be used in monitoring safety, and the efficacy criteria to be evaluated. A protocol for each clinical study and any subsequent protocol amendments must be submitted to the FDA as part of the IND application and, subsequently adhered to in conducting clinical trials, if the IND application is accepted.

In all the countries that are signatories of the Helsinki Declaration, the prerequisite for conducting clinical trials on human subjects is securing the preliminary approval of the competent authorities of that country to conduct medical experiments on human subjects in compliance with the other principles established by the Helsinki Declaration.

The clinical testing of a product candidate (also commonly referenced as a "drug product candidate" or a "therapeutic product candidate") generally is conducted in three sequential phases prior to approval, but the phases may overlap or be combined. A fourth, or post approval, phase may include additional clinical studies. The phases are generally as follows:

*Phase 1*. In Phase 1 clinical studies, the product is tested in a small number of patients with the target condition or disease or in healthy volunteers. These studies are designed to evaluate the safety, dosage tolerance, metabolism and pharmacologic actions of the product candidate in humans, side effects associated with increasing doses, and, in some cases, to gain early evidence on efficacy. The number of participants included in Phase 1 studies is generally in the range of 20 to 80.

*Phase 2*. In Phase 2 studies, in addition to safety, the sponsor evaluates the efficacy of the product candidate on targeted indications to determine dosage tolerance and optimal dosage and to identify possible adverse effects and safety risks. Phase 2 studies typically are larger than Phase 1 but smaller than Phase 3 studies and may involve several hundred participants.

*Phase 3*. Phase 3 studies typically involve an expanded patient population at geographically-dispersed test sites. They are performed after preliminary evidence suggesting effectiveness of the product candidate has been obtained and are designed to further evaluate clinical efficacy and safety, to establish the overall benefit-risk relationship of the product candidate and to provide an adequate basis for a potential product approval. Phase 3 studies usually involve several hundred to several thousand participants.

*Phase 4.* Phase 4 clinical trials are post marketing studies designed to collect additional safety data as well as potentially expand a product indication. Post marketing commitments are required of, or agreed to by, a sponsor after the FDA has approved a product for marketing. These studies are used to gain additional information from the treatment of patients in the intended therapeutic indication and to verify a clinical benefit in the case of drugs approved under accelerated approval regulations. If the FDA approves a product while a company has ongoing clinical trials that were not necessary for approval, a company may be able to use the data from these clinical trials to meet all or part of any Phase 4 clinical trial requirement. These clinical trials are often referred to as Phase 4 post-approval or post marketing commitments. Failure to promptly conduct Phase 4 clinical trials could result in the inability to deliver the product into interstate commerce, misbranding charges, and civil monetary penalties.

Clinical trials must be conducted in accordance with the FDA's good clinical practices ("GCP"), requirements. The FDA may order the temporary or permanent discontinuation of a clinical study at any time or impose other sanctions if it believes that the clinical study is not being conducted in accordance with FDA requirements or that the participants are being exposed to an unacceptable health risk. In addition, to support an IND or an application for marketing approval with the FDA, clinical studies conducted outside of the United States must conform with GCP requirements. An institutional review board ("IRB") generally must approve the clinical trial design and patient informed consent at study sites that the IRB oversees and also may halt a study, either temporarily or permanently, for failure to comply with the IRB's requirements, or may impose other conditions. Additionally, some clinical studies are overseen by an independent group of qualified experts organized by the clinical study sponsor, known as a data safety monitoring board or committee. This group recommends whether or not a trial may move forward at designated check points based on access to certain data from the study. The clinical study sponsor may also suspend or terminate a clinical trial based on evolving business objectives and/or competitive climate.

As a product candidate moves through the clinical testing phases, manufacturing processes are further defined, refined, controlled and validated. The level of control and validation required by the FDA would generally increase as clinical studies progress. We and the third-party manufacturers on which we rely for the manufacture of our product candidates and their respective components (including the API) are subject to requirements that drugs be manufactured, packaged and labeled in conformity with cGMP. To comply with cGMP requirements, manufacturers must continue to spend time, money and effort to meet requirements relating to personnel, facilities, equipment, production and process, labeling and packaging, quality control, recordkeeping and other requirements.

Assuming completion of all required testing in accordance with all applicable regulatory requirements, detailed information on the product candidate is submitted to the FDA in the form of an NDA, requesting approval to market the product for one or more indications, together with payment of a user fee, unless waived. An NDA includes all relevant data available from pertinent nonclinical and clinical studies, including negative or ambiguous results as well as positive findings, together with detailed information on the chemistry, manufacture, control and proposed labeling, among other things. To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the safety and efficacy of the product candidate for its intended use to the satisfaction of the FDA.

If an NDA submission is accepted for filing, the FDA begins an in-depth review of the NDA. Under the Prescription Drug User Fee Act (the "PDUFA"), the FDA's goal is to complete its initial review and respond to the applicant within twelve months of submission, unless the application relates to an unmet medical need in a serious or life-threatening indication, in which case the goal may be within eight months of NDA submission. However, PDUFA goal dates are not legal mandates and FDA response often occurs several months beyond the original PDUFA goal date. Further, the review process and the target response date under PDUFA may be extended if the FDA requests or the NDA sponsor otherwise provides additional information or clarification regarding information already provided in the NDA. The NDA review process can, accordingly, be very lengthy. During its review of an NDA, the FDA may refer the application to an advisory committee for review, evaluation and recommendation as to whether the application should be approved. The FDA is not bound by the recommendation of an advisory committee, but it typically follows such recommendations. Data from clinical studies are not always conclusive and the FDA and/or any advisory committee it appoints may interpret data differently than the applicant.

After the FDA evaluates the NDA and inspects manufacturing facilities where the drug product and/or its API will be produced, it will either approve commercial marketing of the drug product with prescribing information for specific indications or issue a complete response letter indicating that the application is not ready for approval and stating the conditions that must be met in order to secure approval of the NDA. If the complete response letter requires additional data and the applicant subsequently submits that data, the FDA nevertheless may ultimately decide that the NDA does not satisfy its criteria for approval. The FDA could also approve the NDA with a Risk Evaluation and Mitigation Strategies, plan to mitigate risks, which could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries and other risk minimization tools. The FDA also may condition approval on, among other things, changes to proposed labeling, development of adequate controls and specifications, or a commitment to conduct post-marketing testing. Such post-marketing testing may include Phase 4 clinical studies and surveillance to further assess and monitor the product's safety and efficacy after approval. Regulatory approval of products for serious or life-threatening indications may require that participants in clinical studies be followed for long periods to determine the overall survival benefit of the drug.

If the FDA approves one of our therapeutic candidates, we will be required to comply with a number of post-approval regulatory requirements. We will also be required to report, among other things, certain adverse reactions and production problems to the FDA, provide updated safety and efficacy information and comply with requirements concerning advertising and promotional labeling for any of its products. Also, quality control and manufacturing procedures must continue to conform to cGMP after approval, and the FDA periodically inspects manufacturing facilities to assess compliance with cGMP, which imposes extensive procedural, substantive and record keeping requirements. If we seek to make certain changes to an approved product, such as certain manufacturing changes, we will need FDA review and approval before the change can be implemented. For example, if we change the manufacturer of a product or its API, the FDA may require stability or other data from the new manufacturer, which will take time and is costly to generate, and the delay associated with generating this data may cause interruptions in its ability to meet commercial demand, if any. While physicians may use products for indications that have not been approved by the FDA, we may not label or promote the product for an indication that has not been approved. Securing FDA approval for new indications is similar to the process for approval of the original indication and requires, among other things, submitting data from adequate and well-controlled studies that demonstrate the product's safety and efficacy in the new indication. Even if such studies are conducted, the FDA may not approve any change in a timely fashion, or at all.

We have relied, and expect to continue to rely, should we resume development of our product candidates, on third parties for the manufacture of clinical and future commercial, quantities of its therapeutic candidates. Future FDA and state inspections may identify compliance issues at these third-party facilities that may disrupt production or distribution or require substantial resources to correct. In addition, discovery of previously unknown problems with a product or the failure to comply with applicable requirements may result in restrictions on a product, manufacturer or holder of an approved NDA, including withdrawal or recall of the product from the market or other voluntary, FDA-initiated or judicial action that could delay or prohibit further marketing. Newly discovered or developed safety or efficacy data may require changes to a product's approved labeling, including the addition of new warnings and contraindications, and also may require the implementation of other risk management measures. Many of the foregoing could limit the commercial value of an approved product or require us to commit substantial additional resources in connection with the approval of a product. Also, new government requirements, including those resulting from new legislation, may be established, or the FDA's policies may change, which could delay or prevent regulatory approval of its products under development.

*Section 505(b)(2) New Drug Applications*

As an alternate path for FDA approval of new indications or new formulations of previously approved products, a company may file a Section 505(b)(2) NDA, instead of a "stand-alone" or "full" NDA. Section 505(b)(2), was enacted as part of the Drug Price Competition and Patent Term Restoration Act of 1984, otherwise known as the Hatch-Waxman Amendments. Section 505(b)(2) permits the submission of an NDA where at least some of the information required for approval comes from studies not conducted by or for the applicant and for which the applicant has not obtained a right of reference. Some examples of products that may be allowed to follow a 505(b)(2) path to approval are drugs that have a new dosage form, strength, route of administration, formulation or indication.

The Hatch-Waxman Amendments permit the applicant to rely upon certain published nonclinical or clinical studies conducted for an approved product or the FDA's conclusions from prior review of such studies. The FDA may require companies to perform additional studies or measurements to support any changes from the approved product. The FDA may then approve the new product for all or some of the labeled indications for which the reference product has been approved, as well as for any new indication supported by the NDA. While references to nonclinical and clinical data not generated by the applicant or for which the applicant does not have a right of reference are allowed, all development, process, stability, qualification and validation data related to the manufacturing and quality of the new product must be included in an NDA submitted under Section 505(b)(2).

To the extent that the Section 505(b)(2) applicant is relying on the FDA's conclusions regarding studies conducted for an already approved product, the applicant is required to certify to the FDA concerning any patents listed for the approved product in the FDA's Orange Book publication. Specifically, the applicant must certify that: (i) the required patent information has not been filed; (ii) the listed patent has expired; (iii) the listed patent has not expired but will expire on a particular date and approval is sought after patent expiration; or (iv) the listed patent is invalid or will not be infringed by the new product. The Section 505(b)(2) application also will not be approved until any non-patent exclusivity, such as exclusivity for obtaining approval of a new chemical entity, listed in the Orange Book for the reference product has expired. Thus, the Section 505(b)(2) applicant may invest a significant amount of time and expense in the development of its products only to be subject to significant delay and patent litigation before its products may be commercialized.

*Orphan Drug Designation*

The Orphan Drug Act of 1983 (the "Orphan Drug Act") encourages manufacturers to seek approval of products intended to treat "rare diseases and conditions" with a prevalence of fewer than 200,000 patients in the United States or for which there is no reasonable expectation of recovering the development costs for the product. For products that receive Orphan Drug designation by the FDA, the Orphan Drug Act provides tax credits for clinical research, FDA assistance with protocol design, eligibility for FDA grants to fund clinical studies, waiver of the FDA application fee, and a period of seven years of marketing exclusivity for the product following FDA marketing approval. In limited circumstances, the FDA may approve a competing product if the product shows clinical superiority over a product with orphan drug designation exclusivity.

*Foreign Regulation*

In addition to regulations in the United States, we will be subject to a variety of foreign regulations governing clinical trials and commercial sales and distribution of its products. Whether or not we obtain FDA approval for a product, we must obtain approval by the comparable regulatory authorities of foreign countries before we can commence clinical trials or marketing of the product in those countries. The approval process varies from country to country and the time may be longer or shorter than that required for FDA approval. The requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement vary greatly from country to country.

Under European Union regulatory systems, a company may submit marketing authorization applications either under a centralized or decentralized procedure. The centralized procedure, which is compulsory for medicines produced by biotechnology or those medicines intended to treat acquired immunodeficiency syndrome, cancer, neurodegenerative disorders or diabetes and optional for those medicines which are highly innovative, provides for the grant of a single marketing authorization that is valid for all European Union member states. Abridged applications for the authorization of generic versions of drugs authorized by European Medicines Agency can be submitted to the European Medicines Agency through a centralized procedure referencing the innovator's data and demonstrating bioequivalence to the reference product, among other things. The decentralized procedure provides for mutual recognition of national approval decisions. Under this procedure, the holder of a national marketing authorization may submit an application to the remaining member states. Within 90 days of receiving the applications and assessments report, each member state must decide whether to recognize approval. If a member state does not recognize the marketing authorization, the disputed points are eventually referred to the European Commission, whose decision is binding on all member states.

**Reimbursement and Drug Pricing**

In the United States and other countries, sales of any products for which we decide to resume development of and receive regulatory approval for commercial sale will depend in part on the availability of reimbursement from third-party payors, including government payors, managed care providers, private health insurers and other organizations. Each third-party payor may have its own policy regarding what products it will cover, the conditions under which it will cover such products, and how much it will pay for such products. Third-party payors are increasingly examining the medical necessity and cost effectiveness of medical products and services in addition to safety and efficacy and, accordingly, significant uncertainty exists as to the reimbursement status of newly approved therapeutics. Without adequate coverage and reimbursement from third-party payors, patients and providers are unlikely to use or prescribe any products for which we decide to resume development of and receive regulatory approval for commercial sale and may not enable us to realize an appropriate return on our investment in research and product development may not be available for our products.

The prices of prescription pharmaceuticals have also been the subject of considerable discussion in the United States. There have been several proposed and enacted federal and state legislation designed to, among other things, bring more transparency to pharmaceutical pricing, review the relationship between pricing and manufacturer patient programs, and reduce the costs of pharmaceuticals. The passage of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the "MMA") sets forth requirements for the distribution and pricing of prescription drugs for Medicare beneficiaries. The MMA also introduced a new reimbursement methodology. Moreover, while the MMA applies only to drug benefits for Medicare beneficiaries, private payors often follow Medicare coverage policy and payment limitations in setting their own payment rates. Any reduction in payment that results from the MMA may result in a similar reduction in payments from non-governmental payors.

Additionally, the Inflation Reduction Act of 2022 requires, among other things, the Secretary of the U.S. Department of Health and Human Services ("HHS") and the Centers for Medicare & Medicaid Services ("CMS") to negotiate the price of a set number of high Medicare spend drugs starting in 2026, requires rebates from manufacturers who increase their drug prices above inflation, and makes several changes to the Medicare Part B and D that will increase manufacturer liability for drug costs previously borne by the government and beneficiaries under the program. While it remains to be seen how the drug pricing provisions imposed by the IRA will affect the broader pharmaceutical industry, several pharmaceutical manufacturers and other industry stakeholders have initiated and continue to pursue lawsuits challenging the constitutionality and implementation of the IRA's drug price negotiation provisions. It is uncertain how the drug pricing provisions imposed by the IRA, or results on any related litigation, will impact the broader pharmaceutical industry or our business.

Further, the current presidential administration has taken several initiatives to address drug pricing and access. For example, President Trump has signed multiple executive orders addressing drug pricing including: on April 15, 2025, outlining several actions the Secretary of the Department of HHS must take to optimize healthcare regulations that will provide access to prescription drugs at lower costs; on May 5, 2025, aiming to promote domestic production of critical medicines; and on May 12, 2025, aiming to establish a "most favored nation" drug pricing policy that would tie U.S. drug prices to the prices paid for drugs in other countries. Additionally, on November 6, 2025, CMS announced a new voluntary payment initiative called the GENEROUS Model (GENErating cost Reductions for U.S. Medicaid Model) where drug manufacturers may voluntarily offer supplemental rebates to participating state Medicaid programs that are intended to provide such Medicaid programs with a "most favored nation" price for participating manufacturers' products. It remains to be seen how such drug pricing initiatives will affect the broader pharmaceutical industry.

At the state level, individual states are increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. A number of states, for example, require drug manufacturers and other entities in the drug supply chain, including health carriers, pharmacy benefit managers, wholesale distributors, to disclose information about pricing of pharmaceuticals, including, but not limited to, information in connection with new product launches that exceed certain levels as identified in the relevant statutes.

In some foreign countries, requirements governing drug pricing, coverage, and reimbursement vary widely from country to country. For example, the European Union provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. A member state may approve a specific price for the medicinal product, or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market.

We expect that there will continue to be a number of federal, state, and foreign proposals to implement, among other things, drug reimbursement, coverage, and pricing controls. While we cannot predict whether such legislative or regulatory proposals will be adopted, the adoption of such proposals could have a material adverse effect on our business, financial condition, and profitability.

**Compliance with Environmental Laws**

Compliance with applicable environmental requirements during the years ended December 31, 2025, and 2024 has not had a material effect upon our capital expenditures, earnings or competitive position.

**Employees**

As of December 31, 2025, we had two full-time employees, both of whom were engaged in full-time administrative activities. None of our employees are represented by any collective bargaining unit. We believe that we maintain good relations with our employees.

**Properties**

We are a virtual company and do not lease or own any physical space. We maintain a mailing address at 945 Concord Street, Suite 1217, Framingham, Massachusetts 01701.

**Available Information**

We are subject to the information and periodic reporting requirements of the Securities Exchange Act of 1934, as amended, and, in accordance therewith, we file periodic reports, proxy statements and other information with the Securities and Exchange Commission. We make available, free of charge, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to these reports on our website at www.pulmatrix.com as soon as reasonably practicable after those reports and other information is electronically filed with, or furnished to, the Securities and Exchange Commission.

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| **ITEM 1A.** | **RISK FACTORS.** |

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*The following risk factors, together with all of the other information included or incorporated in this Annual Report on Form 10-K, should be carefully considered. If any of the following risks, either alone or taken together, or other risks not presently known to us or that we currently believe to not be significant, develop into actual events, then our business, financial condition, results of operations or prospects could be materially adversely affected. If that happens, the market price of our common stock could decline, and stockholders may lose all or part of their investment.*

**Risk Factor Summary**

We are providing the following summary of the risk factors contained in this Annual Report on Form 10-K to enhance the readability and accessibility of our risk factor disclosures. We encourage you to carefully review the full risk factors contained in this Annual Report on Form 10-K in their entirety for additional information regarding the material factors that make an investment in our securities speculative or risky. These risks and uncertainties include, but are not limited to, the following:

*Risks Related to the Merger with Cullgen*

● There is no assurance when or if the Merger will be completed. Any delay in completing the Merger may substantially reduce the potential benefits that we and Cullgen expect to obtain from the Merger;

● We may engage in the sale, license, transfer, disposition, divestiture or other monetization transaction Pulmatrix Legacy Business;

● The issuance of shares of our common stock to Cullgen stockholders in the Merger will substantially dilute the voting power of our current stockholders. Having a minority share position will reduce the influence that current stockholders have on our management;

● The issuance, or expected issuance, of our common stock in connection with the Merger could decrease the market price of our common stock;

● The intended benefits of the Merger may not be realized;

● Because the lack of a public market for Cullgen common stock makes it difficult to evaluate the fairness of the Merger, Cullgen stockholders may receive consideration in the Merger that is greater than or less than the fair market value of Cullgen common stock;

● Transfers of the Combined Company's securities utilizing Rule 144 of the Securities Act may be limited;

● Our expected disposal of our historical assets and operations in connection with our proposed Merger with Cullgen will make us a shell company. As a result, we will be subject to more stringent reporting requirements, offering limitations and resale restrictions;

● Directors and officers of us and Cullgen may have interests in the Merger that are different from, or in addition to, those of our stockholders and Cullgen stockholders generally that may influence them to support or approve the Merger;

● If the Merger is completed, Cullgen executive officers and Cullgen appointees to the Combined Company board of directors will have the ability to significantly influence the Combined Company's management and business affairs, as well as matters submitted to the Combined Company board of directors or stockholders for approval, especially if they decide to act together with the current Cullgen stockholders;

● The announcement and pendency of the Merger could have an adverse effect on our or Cullgen's business, financial condition, results of operations or business prospects;

● The rights of Cullgen stockholders who become our stockholders in the Merger and our stockholders following the Merger will be governed by the Certificate of Incorporation, as amended;

● The Exchange Ratio is not adjustable based on the market price of our common stock, so the Merger consideration at the Closing may have a greater or lesser value than at the time the Merger Agreement was signed;

● We are expected to incur substantial expenses related to the Merger with Cullgen;

● Failure to complete the Merger could negatively affect the value of our common stock and the future business and financial results of both us and Cullgen;

● The Merger is expected to result in a limitation on the Combined Company's ability to utilize its net operating loss carryforward;

● The analysis received by our board of directors from Lucid Capital Markets, LLC has not been, and is not expected to be, updated to reflect changes in circumstances that may have occurred since the date of the analysis;

● The Merger may be completed even though material adverse changes may result from the announcement of the Merger, industry-wide changes or other causes;

● We and Cullgen may become involved in securities litigation or stockholder derivative litigation in connection with the Merger, and this could divert the attention of our and Cullgen's management and harm the Combined Company's business, and insurance coverage may not be sufficient to cover all related costs and damages;

● We have never paid and, except the potential Cash Dividend in connection with the Merger, do not intend to pay any cash dividends in the foreseeable future;

● We are substantially dependent on our remaining employees, key contractors and consultants to facilitate the consummation of the Merger.

*Risks Related to the Proposed Reverse Stock Split*

● The proposed reverse stock split may not increase the Combined Company's common stock price over the long term;

● The proposed reverse stock split would have the effect of increasing the amount of common stock that the Combined Company is authorized to issue without further approval by the Combined Company stockholders;

● The proposed reverse stock split may decrease the liquidity of our common stock;

● The proposed reverse stock split may lead to a decrease in overall market capitalization of the Combined Company.

*Risks Related to Our Business*

● We have a history of net losses and may experience future losses;

● We will need to raise additional capital to meet our business requirements in the future and such capital raising may be costly or difficult to obtain and could dilute our stockholders' ownership interests;

● We have historically been a clinical development stage biopharmaceutical company and have never been profitable;

● All of our product candidates are still under development, and there can be no assurance of successful commercialization of any of our products;

● Drug development is a long, expensive, and inherently uncertain process with a high risk of failure at every stage of development, and results of earlier studies and trials may not be predictive of future trial results;

● If our collaborators are not successful, we may not effectively develop and market some of our therapeutic candidates;

● We may not be able to attract, retain, or manage highly qualified personnel, which could adversely impact our business;

● We face substantial competition in the development of our product candidates and may not be able to compete successfully, and our product candidates may be rendered obsolete by rapid technological change;

● If the third parties on which we rely to conduct our clinical trials, to manufacture clinical trial materials, and to assist us with preclinical development do not perform as contractually required or expected, we may not be able to obtain regulatory clearance or approval for, or to commercialize, our products;

● We rely on third-party contract vendors to manufacture and supply us with high quality active pharmaceutical ingredients and manufacture our therapeutic candidates in the quantities we require on a timely basis;

● Supply chain and shipping disruptions may result in shipping delays, a significant increase in shipping costs, and could increase product costs and result in lost sales and reputational damage, which may have a material adverse effect on our business, operating results and financial condition;

● We may not be successful in negotiating for an appropriate price in a future sale or assignment of our rights related to our current drug candidates;

● Our failure to successfully acquire, develop and market additional drug candidates or approved drug products could impair our ability to grow;

● Our business strategy may include entry into additional collaborative or license agreements. We may not be able to enter into collaborative or license agreements or may not be able to negotiate commercially acceptable terms for these agreements;

● We may be subject to claims that our employees, independent consultants or agencies have wrongfully used or inadvertently disclosed confidential information of third parties;

● Market and economic conditions may negatively impact our business, financial condition and share price;

● If we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements could be impaired, which could harm our operating results, our ability to operate our business and investors' views of us;

● Our ability to use our net operating loss carryforwards to offset future taxable income may be subject to certain limitations;

● Our business is subject to cybersecurity risks.

*Risks Related to Regulatory Matters*

● Our product candidates must undergo rigorous nonclinical and clinical testing, and we must obtain regulatory approvals, which could be costly and time-consuming and subject us to unanticipated delays or prevent us from marketing any products;

● We cannot be certain that any of our current and future product candidates will receive regulatory approval, and without regulatory approval we will not be able to market our product candidates;

● We have limited experience in filing and pursuing applications necessary to gain regulatory approvals, which may impede our ability to obtain timely approvals from the U.S. Food and Drug Administration ("FDA") or foreign regulatory agencies, if at all;

● Any failure by us to comply with existing or future regulations could harm our reputation and operating results;

● We and our third-party manufacturers are, and will be, subject to regulations of the FDA and other foreign regulatory authorities;

● Even if we obtain regulatory approvals, our therapeutic candidates will be subject to ongoing regulatory review. If we fail to comply with continuing U.S. and applicable foreign laws, regulations and guidelines, we could lose those approvals, and our business would be seriously harmed;

● Our employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements and insider trading;

● If we fail to comply with federal or state "fraud and abuse" laws, the failure to comply with these laws may adversely affect our business, financial condition and results of operations;

● Legislative or regulatory reform of the U.S. healthcare system may adversely affect our business.

*Risks Related to Our Financial Position and Need for Additional Capital*

● We will be required to raise additional capital to fund our operations, and we may not be able to continue as a going concern if we are unable to do so;

● Our long-term capital requirements are subject to numerous risks;

● We may engage in strategic transactions that could impact our liquidity, increase our expenses and present significant distractions to our management.

*Risks Related to Our Intellectual Property*

● We may be unable to adequately protect or enforce our rights to intellectual property, causing us to lose valuable rights. Loss of patent rights may lead us to lose market share and anticipated profits;

● If we are unable to protect the confidentiality of our trade secrets or know-how, such proprietary information may be used by others to compete against us;

● Legal proceedings or third-party claims of intellectual property infringement and other challenges may require us to spend substantial time and money and could prevent us from developing or commercializing our product candidates;

● We may be subject to other patent-related litigation or proceedings that could be costly to defend and uncertain in their outcome;

● Obtaining and maintaining patent protection depends on compliance with various procedures and other requirements, and our patent protection could be reduced or eliminated in case of non-compliance with these requirements;

● If we fail to comply with our obligations under our license agreements, we could lose the rights to intellectual property that is important to our business;

● We may be subject to damages resulting from claims that we or our employees have wrongfully used or disclosed alleged trade secrets of their former employers.

*Risks Related to Our Common Stock*

● The price of our common stock is subject to fluctuation and has been and may continue to be volatile;

● Financial reporting obligations of being a public company in the United States are expensive and time-consuming, and our management may be required to devote substantial time to compliance matters;

● In the foreseeable future, we do not intend to pay cash dividends on shares of our common stock, except the potential Cash Dividend in connection with the Merger, so any investor gains will be limited to the value of our shares;

● We may be at risk of securities class action litigation;

● In the event that we fail to satisfy any of the listing requirements of Nasdaq, our common stock may be delisted, which could affect our market price and liquidity;

● We may issue additional equity securities in the future, which could result in dilution to existing investors;

● We currently take advantage of reduced disclosure and governance requirements applicable to smaller reporting companies, which could result in our common stock being less attractive to investors;

● Anti-takeover provisions under Delaware corporate law may make it difficult for our stockholders to replace or remove our board of directors and could deter or delay third parties from acquiring us, which may be beneficial to our stockholders;

● Protective provisions in our charter and bylaws could prevent a takeover which could harm our stockholders.

**Risks Related to the Merger with Cullgen**

***There is no assurance when or if the Merger will be completed. Any delay in completing the Merger may substantially reduce the potential benefits that we and Cullgen expect to obtain from the Merger.***

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Completion of the Merger is subject to the satisfaction or waiver of a number of conditions, as set forth in the Merger Agreement, including the approval by the CSRC, approval by our stockholders, which was received in 2025, approval by Nasdaq of our application for the initial listing of our common stock to be issued in connection with the Merger, and other customary closing conditions. There can be no assurance that we and Cullgen will be able to satisfy the closing conditions or that closing conditions beyond their control will be satisfied or waived. For a discussion of the conditions to the completion of the Merger, see the section titled "*The Merger Agreement-Conditions to the Completion of the Merger*" beginning on page <u>147</u> of the proxy statement/prospectus included in the registration statement on Form S-4, filed with the SEC on February 14, 2025 (the "proxy statement/prospectus"). If the conditions are not satisfied or waived, the Merger may not occur or may not be completed within the expected timeframe, and we and Cullgen each may materially and adversely lose some or all of the potential benefits that we and Cullgen expect to achieve as a result of the Merger and could result in additional transaction costs or other effects associated with uncertainty about the Merger. In addition, on August 1, 2025, Pulmatrix and Cullgen, as provided for in the Merger Agreement, mutually agreed to extend the "End Date", a term defined in the Merger Agreement, by 60 days from August 13, 2025, to October 12, 2025. The Merger Agreement does not have a defined term and does not terminate on the "End Date". The "End Date" is simply the date at which certain termination options become available to either party. Moreover, each of we and Cullgen has incurred and expects to continue to incur significant expenses related to the Merger, such as legal and accounting fees, some of which must be paid even if the Merger is not completed.

On December 17, 2025, the Company, Cullgen and PLC Merger Sub, Inc. (collectively, the "Parties") entered into a mutual waiver agreement (the "Waiver Agreement"), pursuant to which the Parties agreed to mutually waive compliance with Section 5.4 of the Merger Agreement, which such provision imposes restrictions on each party during the Pre-Closing Period (as defined in the Merger Agreement). Except as expressly waived pursuant to the Waiver Agreement, the Merger Agreement continues to remain in full force and effect in all respects, and no other provision of the Merger Agreement has otherwise been amended, waived, or modified.

We and Cullgen can agree at any time to terminate the Merger Agreement, even if our stockholders and/or Cullgen securityholders have already adopted the Merger Agreement and thereby approved the Merger and the other transactions contemplated by the Merger Agreement. We and Cullgen can also terminate the Merger Agreement under other specified circumstances.

In addition, if the Merger Agreement is terminated and our board of directors or the Cullgen board of directors determines to seek another business combination, it may not be able to find a third party willing to provide equivalent or more attractive consideration than the consideration to be provided by each party in the Merger. In such circumstances, our board of directors may elect to, among other things, divest all or a portion of our business, or take the steps necessary to liquidate all of our business and assets, and in either such case, the consideration that we receive may be less attractive than the consideration to be received by us pursuant to the Merger Agreement.

If the Merger Agreement is not consummated, it is anticipated that we will be delisted from the Nasdaq Capital Market and may need to consider whether to remain a public company. For risks related to a delisting from the Nasdaq Capital Market, see "*-In the event that we fail to satisfy any of the listing requirements of Nasdaq, our common stock may be delisted, which could affect our market price and liquidity*," in this Annual Report.

***We may engage in the sale, license, transfer, disposition, divestiture or other monetization transaction Pulmatrix Legacy Business.***

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There can be no assurance that we will be able to conduct such transactions on favorable terms. Likewise, if the Merger is not completed, our ongoing businesses would be significantly impacted if assets of our business as conducted at any time prior to the date of the Merger Agreement (the "Pulmatrix Legacy Business") is divested prior to the non-completion of the Merger.

***The issuance of shares of our common stock to Cullgen stockholders in the Merger will substantially dilute the voting power of our current stockholders. Having a minority share position will reduce the influence that current stockholders have on our management.***

 ****

Pursuant to the terms of the Merger Agreement, at the First Effective Time, we will issue (or reserve for future issuance) approximately 97,519,045 shares of our common stock using the assumed Exchange Ratio of 1.2491 (which is subject to change depending on the net amount of cash we have and the number of our and Cullgen's outstanding securities at the First Effective Time), without giving effect to the proposed reverse stock split contemplated by the Reverse Stock Split Proposal (as defined herein), to Cullgen stockholders as merger consideration. As a result, upon completion of the Merger, our securityholders as of immediately prior to the Merger are expected to own approximately 3.6145% of the outstanding shares of the Combined Company on a fully-diluted basis, as further described under "*The Merger-Exchange Ratio*" in the proxy statement/prospectus. Accordingly, the issuance of the shares of our common stock to Cullgen stockholders in the Merger will significantly reduce the ownership stake and relative voting power of each share of our common stock held by current stockholders. Consequently, following the Merger, the ability of current stockholders to influence Combined Company management will be substantially reduced.

***The issuance, or expected issuance, of our common stock in connection with the Merger could decrease the market price of our common stock.***

 ****

In connection with the Merger and as part of the merger consideration, we expect to issue shares of common stock to Cullgen stockholders. The anticipated issuance of our common stock in the Merger may result in fluctuations in the market price of our common stock, including a stock price decrease. In addition, the perception in the market that the holders of a large number of shares of our common stock may intend to sell shares could reduce the market price of our common stock.

***The intended benefits of the Merger may not be realized.***

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The Merger poses risks for our and Cullgen's ongoing operations, including, among others:

● that senior management's attention may be diverted from the management of our current operations and development of our products and Cullgen's current operations and development of its products;

● costs and expenses associated with any undisclosed or potential liabilities; and

● unforeseen difficulties may arise in integrating Cullgen's and our business in the Combined Company.

As a result of the foregoing, the Combined Company may be unable to realize the full strategic and financial benefits currently anticipated from the Merger, and we or Cullgen cannot assure you that the Merger will be accretive to us or Cullgen in the near term or at all. Furthermore, if we or Cullgen fail to realize the intended benefits of the Merger, the market price of the Combined Company's common stock could decline to the extent that the market price reflects those benefits. Our stockholders will have experienced substantial dilution of their ownership interests in us without receiving any commensurate benefit, or only receiving part of the commensurate benefit to the extent the Combined Company is able to realize only part of the strategic and financial benefits currently anticipated from the Merger.

***Because the lack of a public market for Cullgen common stock makes it difficult to evaluate the fairness of the Merger, Cullgen stockholders may receive consideration in the Merger that is greater than or less than the fair market value of Cullgen common stock.***

 ****

The outstanding Cullgen common stock is privately held and is not traded in any public market. The lack of a public market makes it extremely difficult to determine the fair market value of Cullgen shares. Since the percentage of our common stock to be issued to Cullgen stockholders was determined based on negotiations between the parties, it is possible that the value of our common stock to be issued in connection with the Merger will be greater than the fair market value of Cullgen shares. Alternatively, it is possible that the value of the shares of our common stock to be issued in connection with the Merger will be less than the fair market value of Cullgen shares.

***Transfers of the Combined Company's securities utilizing Rule 144 of the Securities Act may be limited.***

 ****

To the extent that we complete a sale of the assets of the Pulmatrix Legacy Business prior to completion of the Merger or are otherwise deemed a shell company, a significant portion of the Combined Company's securities will be restricted from immediate resale. Holders should be aware that transfers of the Combined Company's securities pursuant to Rule 144 may be limited as Rule 144 is not available, subject to certain exceptions, for the resale of securities initially issued by shell companies (other than business combination related shell companies) or issuers that have been at any time previously a shell company. Our expected disposal of our historical assets and operations in connection with the Merger with Cullgen will make us a shell company. We anticipate that following the consummation of the Merger, the Combined Company will no longer be a shell company. As a result, we anticipate that holders will not be able to sell their restricted Combined Company securities pursuant to Rule 144 without registration until one year after we file the Current Report on Form 8-K following the Closing that includes the required Form 10 information that reflects that the Combined Company is no longer a shell company.

***Our expected disposal of our historical assets and operations in connection with our proposed Merger with Cullgen will make us a shell company. As a result, we will be subject to more stringent reporting requirements, offering limitations and resale restrictions.***

 ****

We are seeking to divest our three remaining ongoing development programs, PUR3100, PUR1800 and its legacy technology and intellectual property. If deemed necessary by us, such a transaction may be contingent upon obtaining stockholder approval. As such, if successful in the divestment or if otherwise is deemed a shell company, we expect to become a shell company prior to or upon consummation of the Merger, and our Merger with Cullgen would be subject to the requirements applicable to shell company business combinations; provided, however, that if the Merger is not consummated, the disposal of our legacy technology and intellectual property is not expected to occur and we would therefore not expect to become a shell company.

The requirements applicable to shell company business combinations are as follows:

● the Combined Company will need to file a Form 8-K to report the Form 10 type information after Closing with the SEC reflecting its status as an entity that is not a shell company;

● We are not, and the Combined Company will not be, eligible to use a Form S-3 until 12 full calendar months after Closing;

● the Combined Company will need to wait at least 60 calendar days after closing to file a Form S-8 for any equity plans or awards;

● the Combined Company will be an "ineligible issuer" for three years following the closing, which will prevent the Combined Company from (i) incorporating by reference in its Form S-1 filings, (ii) using a free writing prospectus, or (iii) taking advantage of well-known seasoned issuer status despite its public float;

● investors who (i) are affiliates of Cullgen at the time the Merger is submitted for the vote or consent of Cullgen stockholders, (ii) receive securities of the Combined Company in the Merger (i.e., Rule 145(c) securities) and (iii) publicly offer or sell such securities, will be deemed to be engaged in a distribution of such securities, and therefore to be underwriters with respect to resales of those securities, and accordingly such securities may not be included in the Form S-1 resale registration statement anticipated to be filed after the closing of the Merger unless such securities are sold only in a fixed price offering in which such investors are named as underwriters in the prospectus; and

● Rule 144(i)(2) will limit the ability to publicly resell Rule 145(c) securities per Rule 145(d), as well as any other "restricted" or "control" securities of the Combined Company per Rule 144 (i.e., holders of restricted securities and any affiliates of the public company are also affected) until one year after the Form 10 information is filed with the SEC.

The foregoing SEC requirements would increase the Combined Company's time and cost of raising capital, offering stock under equity plans, and complying with securities laws. Further, such requirements will add burdensome restrictions on the resale of Combined Company shares by affiliates of Cullgen and any holders of "restricted" or "control" securities.

***Directors and officers of us and Cullgen may have interests in the Merger that are different from, or in addition to, those of our stockholders and Cullgen stockholders generally that may influence them to support or approve the Merger.***

 ****

Our and Cullgen's officers and directors may have interests in the Merger that are different from, or are in addition to, those of our stockholders and Cullgen stockholders generally. Effective upon the Closing, Ying Luo, Ph.D., Thomas Eastling and Yue Xiong, Ph.D. are expected to be employed as executive officers by the Combined Company. It is expected that five directors designated by Cullgen, Drs. Luo and Xiong, Mr. Eastling, Claire Weston, Ph.D. and Maxwell Kirkby, and one director of our existing board of directors to be agreed to by Cullgen (which such director has not been identified as of the date of this Annual Report) are to be appointed as Combined Company directors after the completion of the Merger and will receive cash and equity compensation in consideration for such service as described in more detail in the section titled "*Management Following the Merger*" beginning on page <u>284</u> of the proxy statement/prospectus. Upon the Merger, the vesting of outstanding equity awards held by our current directors and officers will accelerate. Each outstanding option to acquire shares of Cullgen common stock held by Cullgen executive officers and directors will be converted into an option to acquire shares of our common stock.

In addition, our and Cullgen's directors and executive officers also have certain rights to indemnification or to directors' and officers' liability insurance that will survive the completion of the Merger. These interests may have influenced our and Cullgen's directors and executive officers to support or recommend the proposals presented to our and Cullgen's stockholders. See the sections titled "*The Merger-Interests of Pulmatrix Directors and Executive Officers in the Merger*" beginning on page <u>124</u> and "*The Merger-Interests of Cullgen Directors and Executive Officers in the Merger*" beginning on page <u>126</u> of the proxy statement/prospectus.

***If the Merger is completed, Cullgen executive officers and Cullgen appointees to the Combined Company board of directors will have the ability to significantly influence the Combined Company's management and business affairs, as well as matters submitted to the Combined Company board of directors or stockholders for approval, especially if they decide to act together with the current Cullgen stockholders.***

 ****

Upon completion of the Merger, the former Cullgen securityholders are expected to own approximately 96.3655% of the outstanding shares of the Combined Company on a fully diluted basis, excluding the effects of adjustments based on Pulmatrix's Net Cash (as defined in the Merger Agreement). If the Merger is completed, the Combined Company is expected to be led by Cullgen executive officers. Furthermore, the Combined Company's anticipated board of directors will consist of six members, five of which will be appointed by Cullgen pursuant to the terms of the Merger Agreement and one of which will be an existing member of the Pulmatrix board of directors to be agreed to by Cullgen. As a result, such persons, if they choose to act together, will have the ability to significantly influence the Combined Company's management and business affairs, as well as matters submitted to the Combined Company board of directors or stockholders for approval.

***The announcement and pendency of the Merger could have an adverse effect on our or Cullgen's business, financial condition, results of operations or business prospects.***

The announcement and pendency of the Merger could disrupt our and/or Cullgen's businesses in the following ways, among others:

● Our or Cullgen's current and prospective employees could experience uncertainty about their future roles within the Combined Company, and this uncertainty might adversely affect our or Cullgen's ability to retain, recruit and motivate key personnel;

● the attention of our or Cullgen's management may be directed towards the completion of the Merger and other transaction-related considerations and may be diverted from our or Cullgen's day-to-day business operations, as applicable, and matters related to the Merger may require commitments of time and resources that could otherwise have been devoted to other opportunities that might have been beneficial to us or Cullgen, as applicable;

● customers, prospective customers, suppliers, collaborators and other third parties with business relationships with us or Cullgen may decide not to renew or may decide to seek to terminate, change or renegotiate their relationships with us or Cullgen as a result of the Merger, whether pursuant to the terms of their existing agreements with us or Cullgen; and

● the market price of our common stock may decline to the extent that the current market price reflects a market assumption that the proposed Merger will be completed.

Should they occur, any of these matters could adversely affect the businesses of, or harm the financial condition, results of operations or business prospects of, us or Cullgen.

***The rights of Cullgen stockholders who become our stockholders in the Merger and our stockholders following the Merger will be governed by the Certificate of Incorporation, as amended.***

 ****

Upon consummation of the Merger, outstanding shares of Cullgen common stock will be converted into the right to receive shares of our common stock. Cullgen stockholders who receive shares of our common stock in the Merger will become our stockholders. As a result, Cullgen stockholders who become our stockholders will be governed by the Certificate of Amendment, rather than being governed by the Cullgen Charter. Pursuant to the Merger Agreement, the Amended and Restated Certificate of Incorporation (the "Certificate of Incorporation") will be amended, subject to our stockholders' approval of the applicable proposals described in the proxy statement/prospectus, immediately prior to the effective time of the Merger. See the section titled "*Comparison of Rights of Holders of Pulmatrix Capital Stock and Cullgen Capital Stock*" beginning on page <u>305</u> of the proxy statement/prospectus.

***The Exchange Ratio is not adjustable based on the market price of our common stock, so the Merger consideration at the Closing may have a greater or lesser value than at the time the Merger Agreement was signed.***

 ****

The Merger Agreement has set the Exchange Ratio (as defined in the Merger Agreement) formula for the Cullgen common stock, and the Exchange Ratio is only adjustable upward or downward to reflect our and Cullgen's equity capitalization as of immediately prior to the effective time of the Merger and the excess cash we have at the effective time of the Merger. Any changes in the market price of common stock before the completion of the Merger will not affect the number of shares Cullgen securityholders will be entitled to receive pursuant to the Merger Agreement. Therefore, if before the completion of the Merger, the market price of our common stock declines from the market price on the date of the Merger Agreement, then Cullgen securityholders could receive merger consideration with substantially lower value. Similarly, if before the completion of the Merger, the market price of our common stock increases from the market price on the date of the Merger Agreement, then Cullgen securityholders could receive merger consideration with substantially more value for their shares of Cullgen common stock than the parties had negotiated for in the establishment of the Exchange Ratio. For a discussion of the Exchange Ratio, see the section titled "*The Merger Agreement-Exchange Ratio*" beginning on page <u>136</u> of the proxy statement/prospectus.

***We are expected to incur substantial expenses related to the Merger with Cullgen.***

 ****

We have incurred, and expect to continue to incur, substantial expenses in connection with the Merger, as well as operating as a public company. We will incur significant fees and expenses relating to legal, accounting, financial advisory and other transaction fees and costs associated with the Merger. Actual transaction costs may substantially exceed our estimates and may have an adverse effect on the Combined Company's financial condition and operating results.

***Failure to complete the Merger could negatively affect the value of our common stock and the future business and financial results of both us and Cullgen.***

 ****

If the Merger is not completed, our and Cullgen's ongoing businesses could be adversely affected. Moreover, we and Cullgen will be subject to a variety of risks associated with the failure to complete the Merger, including without limitation the following:

● diversion of management focus and resources from operational matters and other strategic opportunities while working to implement the Merger;

● reputational harm due to the adverse perception of any failure to successfully complete the Merger; and

● having to pay certain costs relating to the Merger, such as legal, accounting, financial advisory, filing and printing fees.

If the Merger is not completed, the market price of our common stock and the business and financial results of both us (including the cessation of its operations) and Cullgen could be materially affected.

***The Merger is expected to result in a limitation on the Combined Company's ability to utilize its net operating loss carryforward.***

Under Section 382 of the Code, use of our net operating loss carryforwards ("NOLs") will be limited if we experience a cumulative change in ownership of greater than 50% in a moving three-year period. As of December 31, 2025, we had approximately $81.7 million of net operating loss carryforwards, of which $3.8 million will expire, if unused, between the years 2026 and 2037. We may experience an ownership change as a result of the Merger and therefore its ability to utilize its NOLs and certain credit carryforwards remaining at the effective time of the Merger may be limited. The limitation would be determined by the fair market value of our common stock outstanding prior to the ownership change, multiplied by the applicable federal rate. Limitations imposed on us ability to utilize NOLs could cause U.S. federal and state income taxes to be paid earlier than would be paid if such limitations were not in effect and could cause such NOLs to expire unused, in each case reducing or eliminating the benefit of such NOLs.

***The analysis received by our board of directors from Lucid Capital Markets, LLC has not been, and is not expected to be, updated to reflect changes in circumstances that may have occurred since the date of the analysis.***

Such analysis was one of many factors considered by our board of directors in approving the Merger. The analysis does not speak as of the time the Merger will be completed or any date other than the date of such analysis. Subsequent changes in the operation and prospects of us or Cullgen, general market and economic conditions and other factors that may be beyond the control of us or Cullgen, may significantly alter the value of us or Cullgen or the prices of the shares of our common stock by the time the Merger is to be completed. The analysis does not address the fairness of the merger consideration from a financial point of view to us at the time the Merger is to be completed, or as of any other date other than the date of such analysis, and the Merger Agreement does not require that the analysis be updated, revised or reaffirmed prior to the Closing to reflect any changes in circumstances between the date of the signing of the Merger Agreement and the completion of the Merger as a condition to closing the Merger. See the section titled "*The Merger-Opinion of Pulmatrix's Financial Advisor*" beginning on page <u>112</u> of the proxy statement/prospectus.

***The Merger may be completed even though material adverse changes may result from the announcement of the Merger, industry-wide changes or other causes.***

In general, either party can refuse to complete the Merger if there is a material adverse effect affecting the other party between November 13, 2024, the date of the Merger Agreement, and the Closing of the Merger. However, some types of changes do not permit either party to refuse to complete the Merger, even if such changes would have a material adverse effect on us or Cullgen, as the case may be:

● changes or events affecting the industries in which the parties operate generally;

● any natural disaster, calamity or epidemics, pandemics or other force majeure events or any act or threat of terrorism or war, any armed hostilities or terrorist events anywhere in the world or any governmental or other response or reaction to any of the foregoing; or

● changes in U.S. GAAP or other applicable law or the interpretation thereof.

If adverse changes occur but we and Cullgen must still complete the Merger, the market price of our common stock may suffer. For a more complete discussion of what constitutes a material adverse effect on us or Cullgen under the Merger Agreement, see the section titled "*The Merger Agreement- Representations and Warranties*" beginning on page <u>140</u> of the proxy statement/prospectus.

***We, our Board of Directors, and/or and Cullgen may become involved in securities litigation or stockholder derivative litigation in connection with the Merger, and this could divert the attention of our and Cullgen's management and harm our, Cullgen, and/or the Combined Company's business, and insurance coverage may not be available or sufficient to cover all related costs, expenses, and damages.***

Securities litigation or stockholder derivative litigation frequently follows the announcement of certain significant business transactions, such as the sale of a business division or announcement of a business combination transaction. We, our Board of Directors, and/or Cullgen may become involved in this type of litigation in connection with the Merger, and the Combined Company may become involved in this type of litigation in the future. Litigation often is expensive and diverts management's attention and resources, which could adversely affect the business of us, Cullgen and the Combined Company.

In connection with the Merger Agreement and the proxy statement/prospectus, Pulmatrix has received multiple demand letters from purported Pulmatrix stockholders demanding that Pulmatrix disclose certain additional information related to the merger (the "Demands"). Pulmatrix cannot predict the outcome of the Demands. Pulmatrix believes that the claims asserted in the Demands are without merit and intends to defend against them vigorously. Additional demand letters or lawsuits arising out of the Merger may also be received or filed in the future.

***We have never paid and, except the potential Cash Dividend in connection with the Merger, do not intend to pay any cash dividends in the foreseeable future.***

We have never paid cash dividends on any of its capital stock. Pursuant to the terms of the Merger Agreement, we may declare and pay a special cash dividend to our stockholders of record prior to the Merger (the "Cash Dividend"). The Cash Dividend will be up to an amount equal in the aggregate to our reasonable, good faith approximation of the amount by which Parent Net Cash (as defined in the Merger Agreement) will exceed the Cash Dividend Amount (as defined in the Merger Agreement), provided, that if the Closing Parent Net Cash is greater than $7,000,000, the Cash Dividend Amount shall not exceed (x) $4,500,000 plus (y) an amount equal to (A) 0.5 multiplied by (B) the Closing Parent Net Cash in excess of $7,000,000. There is no guarantee that the Parent Net Cash will exceed $2,500,000. The amount of the Cash Dividend is currently uncertain, pending the determination of our outstanding obligations and net cash position as of the Closing. Other than such potential special cash dividend in connection with the Closing, we do not currently anticipate declaring or paying cash dividends on its capital stock in the foreseeable future.

***We are substantially dependent on our remaining employees, key contractors and consultants to facilitate the consummation of the Merger.***

Our ability to successfully complete the Merger depends in large part on our ability to retain certain remaining personnel, in addition to key contractors and consultants. Despite our efforts to retain these employees, as well as key contractors and consultants, one or more may terminate their employment or services with us on short notice. The loss of the service of certain employees, key contractors or consultants could potentially harm our ability to consummate the Merger and run our day-to-day business operations, as well as fulfill our reporting obligations as a public company.

**Risks Related to the Proposed Reverse Stock Split**

***The proposed reverse stock split may not increase the Combined Company's common stock price over the long term.***

If the proposal to approve an amendment to the Certificate of Incorporation to effect a reverse stock split of the issued and outstanding common stock at a ratio determined by our board of directors and agreed to by Cullgen as further described in the joint proxy statement/prospectus (the "Reverse Stock Split Proposal") is approved, the Combined Company anticipates effecting a reverse stock split in order at a ratio to be determined in the future. While it is expected that the reduction in the number of outstanding shares of common stock will proportionally increase the market price of the Combined Company common stock upon effectiveness of the proposed reverse stock split, it cannot be assured that the proposed reverse stock split will result in any sustained proportionate increase in the market price of the Combined Company common stock, which is dependent upon many factors, including the business and financial performance of the Combined Company, general market conditions, and prospects for future success, which are unrelated to the number of shares of the Combined Company common stock outstanding. While the Combined Company common stock price might meet the initial listing requirements for Nasdaq initially, it cannot be assured that it will continue to do so.

***The proposed reverse stock split would have the effect of increasing the amount of common stock that the Combined Company is authorized to issue without further approval by the Combined Company stockholders.***

The proposed amendment to the Certificate of Incorporation in connection with the proposal to increase the number of authorized shares of common stock of the Company as set forth in the joint proxy statement/prospectus is anticipated to authorize the Combined Company to issue up to a certain number of shares of common stock yet to be determined as of the date of this Annual Report on Form 10-K, and does not anticipate reducing this amount in connection with the proposed reverse stock split. Except in certain instances, as required by law or by the rules of the securities exchange that lists the Combined Company common stock, these additional shares may be issued by the Combined Company without further vote of the Combined Company stockholders. If the Combined Company's board of directors chooses to issue additional shares of the Combined Company common stock, such issuance could have a dilutive effect on the equity, earnings and voting interests of the Combined Company stockholders.

***The proposed reverse stock split may decrease the liquidity of our common stock.***

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Although our board of directors believes that the anticipated increase in the market price of our common stock could encourage interest in its common stock and possibly promote greater liquidity for its stockholders, such liquidity could also be adversely affected by the reduced number of shares outstanding after the reverse stock split. The reduction in the number of outstanding shares may lead to reduced trading and a smaller number of market makers for our common stock.

***The proposed reverse stock split may lead to a decrease in overall market capitalization of the Combined Company.***

Should the market price of our common stock decline after the proposed reverse stock split, the percentage decline may be greater, due to the smaller number of shares outstanding, than it would have been prior to the reverse stock split. A reverse stock split is often viewed negatively by the market and, consequently, can lead to a decrease in the overall market capitalization of the Combined Company. If the per share market price does not increase in proportion to the reverse stock split ratio, then the value of the Combined Company, as measured by its stock capitalization, will be reduced. In some cases, the per-share stock price of companies that have effected reverse stock splits subsequently declined back to pre-reverse split levels and, accordingly, it cannot be assured that the total market value of our common stock will remain the same after the reverse stock split is effected, or that the proposed reverse stock split will not have an adverse effect on our common stock price due to the reduced number of shares outstanding after the proposed reverse stock split.

**Risks Related to Our Business**

***We have a history of net losses and may experience future losses.***

We have yet to establish any history of profitable operations. We reported a net loss of $5.2 million and $9.6 million for the fiscal years ended December 31, 2025, and 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $302.3 million. We expect to incur additional operating losses for the foreseeable future. There can be no assurance that we will be able to achieve sufficient revenues throughout the year or be profitable in the future.

***We will need to raise additional capital to meet our business requirements in the future and such capital raises may be costly or difficult to obtain and could dilute our stockholders' ownership interests.***

Our current capital will be sufficient to enable us to continue operations for at least 12 months following the filing date of this Annual Report on Form 10-K. In order to continue our operations and to fully realize all of our business objectives, absent any non-dilutive funding from a strategic partner or some other strategic transactions, we will need to raise additional capital, which may not be available on reasonable terms, or at all. For instance, we will need to raise additional funds to accomplish the following:

● advancing the research and development of our therapeutic candidates;

● investing in protecting and expanding our intellectual property portfolio, including filing for additional patents to strengthen our intellectual property rights;

● hiring and retaining qualified management and key employees;

● responding to competitive pressures; and

● maintaining compliance with applicable laws.

Any additional capital raised through the sale of equity or equity backed securities will dilute our stockholders' ownership percentages and could also result in a decrease in the market value of our equity securities.

The terms of any securities issued by us in future financing transactions may be more favorable to new investors, and may include preferences, superior voting rights and the issuance of warrants or other derivative securities, which may have a further dilutive effect on the holders of any of our securities then outstanding.

Furthermore, any additional capital financing that we may need in the future may not be available on terms favorable to us, or at all. If we are unable to obtain such additional financing on a timely basis, we may have to curtail our development activities and growth plans and/or be forced to sell assets, perhaps on unfavorable terms, which would have a material adverse effect on our business, financial condition and results of operations, and ultimately could be forced to discontinue our operations and liquidate, in which event it is unlikely that stockholders would receive any distribution on their shares. Further, we may not be able to continue operating if we do not generate sufficient revenues from operations needed to stay in business.

In addition, we may incur substantial costs in pursuing future capital financing, including investment banking fees, legal fees, accounting fees, securities law compliance fees, printing and distribution expenses and other costs. We may also be required to recognize non-cash expenses in connection with certain securities we issue, such as convertible notes and warrants, which may adversely impact our financial condition and cause further dilution to our stockholders.

***We have historically been a clinical development stage biopharmaceutical company and have never been profitable. We expect to incur additional losses in the future and may never be profitable.***

We have historically been a clinical development stage biopharmaceutical company. We have not commercialized any product candidates or recognized any revenues from our product sales. All of our product candidates are still in the preclinical or clinical development stage, and none have been approved for marketing or are currently being marketed or commercialized. Our product candidates will require substantial additional development, clinical studies, regulatory clearances, and additional investments of time and capital before they can be commercialized. We cannot be certain when or if any of our product candidates will obtain the required regulatory approval.

We have never been profitable and have incurred net losses each year since our inception. Our losses are principally a result of research and development and general administrative expenses in support of our operations. We may incur substantial additional losses as we continue to focus our resources on prioritizing, selecting and advancing our product candidates. Our ability to generate revenue and achieve profitability depends mainly upon our ability, alone or with others, to successfully develop our product candidates, obtain the required regulatory approvals in various territories and commercialize our product candidates. We may be unable to achieve any or all of these goals with regard to our product candidates. As a result, we may never be profitable or achieve significant and/or sustained revenues.

***All of our product candidates are still under development, and there can be no assurance of successful commercialization of any of our products.***

All of our research and development programs are in developmental stages. One or more of our product candidates may fail to meet safety and efficacy standards in human testing, even if those product candidates are found to be effective in animal studies. To develop and commercialize inhaled therapeutic treatment for allergic bronchopulmonary aspergillosis ("ABPA"), acute migraine, and other iSPERSE*<sup>™</sup>*-based product candidates, we must provide the FDA and foreign regulatory authorities with human clinical and non-clinical animal data that demonstrate adequate safety and effectiveness. To generate these data, we will have to subject our product candidates to substantial additional research and development efforts, including extensive non-clinical studies and clinical testing. Our approach to drug development may not be effective or may not result in the development of any drug. Our development efforts have been primarily focused on PUR3100, PUR1800 and PUR1900. Even if PUR3100, PUR1800 and PUR1900 or our other product candidates are successful when tested in animals, such success would not be a guarantee of the safety or effectiveness of such product candidates in humans. It can take several years for a product to be approved and we may not be successful in bringing any therapeutic candidates to the market. A new drug may appear promising at an early stage of development or after clinical trials and never reach the market, or it may reach the market and not sell, for a variety of reasons. For example, the drug may:

● be shown to be ineffective or to cause harmful side effects during preclinical testing or clinical trials;

● fail to receive regulatory approval on a timely basis or at all;

● be difficult to manufacture on a large scale;

● not be economically viable;

● not be prescribed by doctors or accepted by patients;

● fail to receive a sufficient level of reimbursement from government, insurers or other third-party payors; or

● infringe on intellectual property rights of any other party.

If our delivery platform technologies or product development efforts fail to generate product candidates that lead to the successful development and commercialization of products, our business and financial condition will be materially adversely affected.

***Drug development is a long, expensive and inherently uncertain process with a high risk of failure at every stage of development, and results of earlier studies and trials may not be predictive of future trial results.***

We have a number of proprietary drug candidates in research and development ranging from the early research phase through preclinical testing and clinical trials. Preclinical testing and clinical trials are long, expensive and highly uncertain processes. It will take us several years to complete clinical trials and we may not have the resources to complete the development and commercialization of any of our proposed drug candidates. The start or end of a clinical trial can often be delayed or halted due to changing regulatory requirements, manufacturing challenges, required clinical trial administrative actions, slower than anticipated patient enrollment, changing standards of care, availability or prevalence of use of a competitor drug or required prior therapy, clinical outcomes, or financial constraints of us and our partners.

Drug development is a highly uncertain scientific and medical endeavor, and failure can unexpectedly occur at any stage of preclinical and clinical development. Typically, there is a high rate of attrition for drug candidates in preclinical and clinical trials due to scientific feasibility, safety, efficacy, changing standards of medical care and other variables. The risk of failure is heightened for our drug candidates that are based on new technologies, such as the application of our dry powder delivery platform, iSPERSE*<sup>™</sup>*, including PUR3100, PUR1800, PUR1900 and other iSPERSE*<sup>™</sup>*-based drug candidates currently in research or preclinical development. The failure of one or more of our iSPERSE*<sup>™</sup>*-based drug candidates could have a material adverse effect on our business, financial condition, and results of operations.

In addition, the results of preclinical studies and clinical trials of previously published iSPERSE*<sup>™</sup>*-based products may not necessarily be indicative of the results of our future clinical trials. The design of our clinical trials is based on many assumptions about the expected effects of inhaled drugs used historically in the industry and if those assumptions are incorrect, the trials may not produce statistically significant results. Preliminary results may not be confirmed upon full analysis of the detailed results of an early clinical trial. Product candidates in later stages of clinical trials may fail to show safety and efficacy sufficient to support intended use claims despite having progressed through initial clinical trials. The data collected from clinical trials of our product candidates may not be sufficient to obtain regulatory approval in the United States or elsewhere. Because of the uncertainties associated with drug development and regulatory approval, we cannot determine if, or when, we may have an approved product for commercialization or whether we will ever achieve sales of or profits on our product candidates or those we may pursue in the future.

***If our collaborators are not successful, or breach their agreements with us, we may not effectively develop and market some of our therapeutic candidates.***

At this time, we have entered into a co-development agreement regarding one of our therapeutic candidates and, as a result, we no longer have complete control over the development of this candidate. We may also enter into co-development agreements for our other therapeutic candidates in the future. If our collaborators do not successfully carry out their contractual duties or meet expected deadlines, or they otherwise breach their contractual obligations to us, we may be delayed or may not obtain regulatory approval for, or commercialize, our product candidates. We are also subject to the terms of such co-development agreements that may affect our ability to develop and manufacture our therapeutic candidates. As a result of such limitations, we may be unable to pursue the most efficient or profitable path in developing our therapeutic candidates.

If our relationships with these collaborators terminate, we believe that we would be able to enter into arrangements with alternative third parties. However, replacing any collaborator could delay our clinical trials and could jeopardize our ability to obtain regulatory approvals and commercialize our product candidates on a timely basis, if at all.

***We may not be able to attract, retain, or manage highly qualified personnel, which could adversely impact our business.***

Our future success and ability to compete in the biopharmaceutical industry is substantially dependent on our ability to identify, attract, and retain highly qualified key managerial, scientific, medical, and operations personnel. The market for key employees in the biopharmaceutical, pharmaceutical and biotechnology industries is competitive. The loss of the services of any of our principal members of management or key employees without an adequate replacement or our inability to hire new employees as needed could delay our product development efforts, harm our ability to sell our products or otherwise negatively impact our business.

The scientific, research and development personnel upon whom we have historically relied to operate our business have expertise in certain aspects of drug development and clinical development, and it may be difficult to replace these individuals. We have previously conducted our research and development operations within the greater Boston area, and this region is headquarters to many other biopharmaceutical, biotechnology, pharmaceutical, and medical technology companies, as well as many academic and research institutions, and, therefore, we face increased competition for technical and managerial personnel in this region.

In addition, we have scientific, medical and clinical advisors who assist us in designing and formulating our products and with development and clinical strategies. These advisors are not our employees and may have commitments to, or consulting or advisory contracts with, other entities that may limit their availability to us, or may have arrangements with other companies to assist in the development of products that may compete with ours.

Despite our efforts to retain valuable employees, members of our management and scientific and development teams may terminate their employment with us at any time. Although we have written employment offer letter agreements with our executive officers, our executive officers can leave their employment at any time, for any reason, with 30 days' notice. A sustained labor shortage or increased turnover rates within our employee base could lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees, and could negatively affect our ability to efficiently operate our manufacturing and distribution facilities and overall business. If we are unable to hire and retain employees capable of performing at a high-level, or if mitigation measures we may take to respond to a decrease in labor availability, such as overtime and third-party outsourcing, have unintended negative effects, our business could be adversely affected. An overall labor shortage, lack of skilled labor, increased turnover or labor inflation could have a material adverse impact on our operations, results of operations, liquidity or cash flows. The loss of the services of any of our executive officers or our other key employees and our inability to find suitable replacements could potentially harm our business, financial condition and prospects. We do not maintain "key man" insurance policies on the lives of these individuals or the lives of any of our other employees.

***We face substantial competition in the development of our product candidates and may not be able to compete successfully, and our product candidates may be rendered obsolete by rapid technological change.***

The pharmaceutical and biotechnology industry is highly competitive, and we face substantial competition from many pharmaceutical, biopharmaceutical and biotechnology companies that are researching and marketing products designed to address the indications for which we are currently developing therapeutic candidates or for which we may develop product candidates in the future.

Many of our existing or potential competitors have, or have access to, substantially greater financial, research and development, production, and sales and marketing resources than we do and have a greater depth and number of experienced managers. As a result, our competitors may be better equipped than us to develop, manufacture, market and sell competing products. In addition, gaining favorable reimbursement is critical to the success of our product candidates. We are aware of many established pharmaceutical companies in the United States and other parts of the world that have or are developing technologies for inhaled drug delivery for the prevention and treatment of respiratory diseases, including GlaxoSmithKline, Mereo BioPharma, Mylan, Savara, Insmed, Satsuma, Bristol-Meyers, TFF Pharmaceuticals, Zambon Pharma and Pulmocide, which we consider our potential competitors in this regard. If we are unable to compete successfully with these and other potential future competitors, we may be unable to grow or generate revenue.

The rapid rate of scientific discoveries and technological changes could result in one or more of our product candidates becoming obsolete or noncompetitive. Our competitors may develop or introduce new products that render our iSPERSE*<sup>™</sup>* delivery technology and other product candidates less competitive, uneconomical or obsolete. Some of these technologies may have an entirely different approach or means of accomplishing similar therapeutic effects compared to our drug candidates. Our future success will depend not only on our ability to develop our product candidates but to improve them and keep pace with emerging industry developments. We cannot assure you that we will be able to do so.

We also expect to face increasing competition from universities and other non-profit research organizations. These institutions carry out substantial research and development in the areas of respiratory diseases. These institutions are becoming increasingly aware of the commercial value of their findings and are more active in seeking patent and other proprietary rights as well as licensing revenues.

The potential acceptance of therapeutics that are alternatives to ours may limit market acceptance of our product candidates, even if commercialized. Respiratory diseases, including our targeted diseases and conditions, can also be treated by other medication or drug delivery technologies. These treatments may be widely accepted in medical communities and have a longer history of use. The established use of these competitive drugs may limit the potential for our product candidates to receive widespread acceptance if commercialized.

***If the third parties on which we rely to conduct our clinical trials and to assist us with preclinical development do not perform as contractually required or expected, we may not be able to obtain regulatory clearance or approval for, or to commercialize, our products.***

We do not have the ability to independently conduct our preclinical and clinical trials for our products and we must rely on third parties, such as contract research organizations, medical institutions, clinical investigators and contract laboratories to conduct such trials. If these third parties do not successfully carry out their contractual duties or regulatory obligations or meet expected deadlines, if these third parties need to be replaced, or if the quality or accuracy of the data they obtain is compromised due to the failure to adhere to our clinical protocols or regulatory requirements or for other reasons, our preclinical development activities or clinical trials may be extended, delayed, suspended or terminated, and we may not be able to obtain regulatory approval for, or successfully commercialize, our products on a timely basis, if at all, and our business, operating results and prospects may be adversely affected. Furthermore, our third-party clinical trial investigators may be delayed in conducting our clinical trials for reasons outside of our control, such as, but not limited to, patient enrollment.

***We rely on third-party contract vendors to manufacture and supply us with high quality active pharmaceutical ingredients and manufacture our therapeutic candidates in the quantities we require on a timely basis.***

We currently do not manufacture any active pharmaceutical ingredients ("APIs"). Instead, we rely on third-party vendors for the manufacture and supply of our APIs that are used to formulate our therapeutic candidates. We also do not currently own or operate manufacturing facilities and therefore rely, and expect to continue to rely, on third parties to manufacture clinical and commercial quantities of our therapeutic candidates and for quality assurance related to regulatory compliance. If these suppliers or manufacturers are incapable or unwilling to meet our current or future needs at our standards or on acceptable terms, if at all, we may be unable to locate alternative suppliers or manufacturers on acceptable terms, if at all, or produce necessary materials or components on our own.

While there may be several alternative suppliers of API in the market, changing API suppliers or finding and qualifying new API suppliers can be costly and can take a significant amount of time. Many APIs require significant lead time to manufacture. There can also be challenges in maintaining similar quality or technical standards from one manufacturing batch to the next. We could experience a delay in conducting clinical trials of or obtaining regulatory approval for PUR3100, PUR1800, PUR1900 or our other drug candidates and incur additional costs if we changed API suppliers for any reason. Similarly, replacing our manufacturers could cause us to incur added costs and experience delays in identifying, engaging, qualifying and training any such replacements.

If we are not able to find stable, affordable, high quality, or reliable supplies of the APIs, or if we are unable to maintain our existing or future third-party manufacturing arrangements, we may not be able to produce enough supply of our therapeutic candidates or commercialize any therapeutic candidates on a timely and competitive basis, which could adversely affect our business, financial condition or results of operations.

***Supply chain and shipping disruptions may result in shipping delays, a significant increase in shipping costs, and could increase product costs and result in lost sales and reputational damage, which may have a material adverse effect on our business, operating results and financial condition.***

Our third-party manufacturers and suppliers have experienced, and may continue to experience, supply chain disruption and shipping disruptions, including disruptions or delays in loading container cargo in ports of origin or off-loading cargo at ports of destination, congestion in port terminal facilities, labor supply and shipping container shortages, inadequate equipment and persons to load, dock and offload container vessels and for other reasons. These disruptions may impact our ability to receive our raw materials and certain components required for the manufacture of our clinical trial materials or products in the future, to distribute our products in a cost-effective and timely manner and to meet demand, all of which could have an adverse effect on our financial condition and results of operations. There can be no assurance that further unforeseen events impacting the supply chain will not have a material adverse effect on us in the future. Additionally, the impacts that supply chain disruptions have on our third-party manufacturers and suppliers are not within our control. It is not currently possible to predict how long it will take for these supply chain disruptions to cease or ease. Prolonged supply chain disruption that may impact us or our manufacturers and suppliers could interrupt or delay our clinical trials, product manufacturing, increase raw material and product lead times, increase raw material and product costs, impact our ability to meet customer demand and result in lost sales and reputational damage, all of which could have a material adverse effect on our business, financial condition and results of operations.

***We may not be successful in negotiating for an appropriate price in a future sale or assignment of our rights related to our current drug candidates.***

We may seek to sell or assign our rights related to our current drug candidates. If completed, any such sale or assignment may be at a substantial discount, the consideration received may not accurately represent the value of the assets sold or assigned and our stockholders may not be entitled to participate in the future prospects of such drug candidates.

***Our failure to successfully acquire, develop and market additional drug candidates or approved drug products could impair our ability to grow.***

As part of our growth strategy, we may evaluate, acquire, license, develop and/or market additional product candidates and technologies, subject to the availability of adequate financing. However, our internal research capabilities are limited, and we may be dependent upon pharmaceutical and biotechnology companies, academic scientists and other researchers to sell or license products or technology to us. The success of this strategy depends partly upon our ability to identify, select and acquire promising pharmaceutical product candidates and products. The process of proposing, negotiating and implementing a license or acquisition of a product candidate or approved product is lengthy and complex. Other companies, including some with substantially greater financial, marketing and sales resources, may compete with us for the license or acquisition of product candidates and approved products. We have limited resources to identify and execute the acquisition or in-licensing of third-party products, businesses and technologies and integrate them into our current infrastructure. Moreover, we may devote resources to potential acquisitions or in-licensing opportunities that are never completed, or we may fail to realize the anticipated benefits of such efforts. We may not be able to acquire the rights to additional product candidates on terms that we find acceptable, or at all.

Any product candidate that we acquire may require additional development efforts prior to commercial sale, including extensive clinical testing and approval by the FDA and applicable foreign regulatory authorities. All product candidates are prone to risks of failure typical of pharmaceutical product development, including the possibility that a product candidate will not be shown to be sufficiently safe and effective for approval by regulatory authorities. In addition, we cannot provide assurance that any products that we develop or approved products that we acquire will be manufactured profitably or achieve market acceptance. We cannot guarantee that we will be able to successfully conduct the preclinical studies of the identified potential product candidates as anticipated.

***Our business strategy may include entry into additional collaborative or license agreements. We may not be able to enter into collaborative or license agreements or may not be able to negotiate commercially acceptable terms for these agreements.***

Our current business strategy may include the entry into additional collaborative or license agreements for the development and commercialization of our product candidates and technologies. The negotiation and consummation of these types of agreements typically involve simultaneous discussions with multiple potential collaborators or licensees and require significant time and resources. In addition, in attracting the attention of pharmaceutical and biotechnology company collaborators or licensees, we compete with numerous other third parties with product opportunities as well as the collaborators' or licensees' own internal product opportunities. We may not be able to consummate collaborative or license agreements, or we may not be able to negotiate commercially acceptable terms for these agreements.

If we do enter into such arrangements, we could be dependent upon the subsequent success of these other parties in performing their respective responsibilities and the cooperation of our partners. Our collaborators may not cooperate with us or perform their obligations under our agreements with them. We cannot control the amount and timing of our collaborators' resources that will be devoted to researching our product candidates pursuant to our collaborative agreements with them. Our collaborators may choose to pursue existing or alternative technologies in preference to those being developed in collaboration with us. If we do not consummate collaborative or license agreements, we may use our financial resources more rapidly on our product development efforts, continue to defer certain development activities or forego the exploitation of certain geographic territories, any of which could have a material adverse effect on our business prospects. Further, we may not be successful in overseeing any such collaborative arrangements. If we fail to establish and maintain necessary collaborative or license relationships, our business prospects could suffer.

***We may be subject to claims that our employees, independent consultants or agencies have wrongfully used or inadvertently disclosed confidential information of third parties.***

We employ individuals and contract with independent consultants and agencies that may have previously worked at or conducted business with third parties; and, we may be subject to claims that we or our employees, consultants or agencies have inadvertently or otherwise used or disclosed confidential information of our employees' former employers or other third parties. We may also be subject to claims that our employees' former employers or other third parties have an ownership interest in our patents. Litigation may be necessary to defend against these claims. There is no guarantee of success in defending these claims, and if we are successful, litigation could result in substantial cost and be a distraction to our management and other employees.

***Market and economic conditions may negatively impact our business, financial condition and share price.***

Concerns over inflation, geopolitical issues, the U.S. financial markets and a declining real estate market, unstable global credit markets and financial conditions, and volatile oil prices have led to periods of significant economic instability, diminished liquidity and credit availability, declines in consumer confidence and discretionary spending, diminished expectations for the global economy and expectations of slower global economic growth going forward, increased unemployment rates, and increased credit defaults in recent years. Our general business strategy may be adversely affected by any such economic downturns, volatile business environments and continued unstable or unpredictable economic and market conditions. If these conditions continue to deteriorate or do not improve, it may make any necessary debt or equity financing more difficult to complete, more costly, and more dilutive. In addition, there is a risk that one or more of our current and future service providers, manufacturers, suppliers, hospitals and other medical facilities, our third-party payors, and other partners could be negatively affected by difficult economic times, which could adversely affect our ability to attain our operating goals on schedule and on budget or meet our business and financial objectives.

***If we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements could be impaired, which could harm our operating results, our ability to operate our business and investors' views of us.***

Ensuring that we have adequate internal financial and accounting controls and procedures in place so that we can produce accurate financial statements on a timely basis is a costly and time-consuming effort that will need to be evaluated frequently. Section 404 of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act") requires public companies to conduct an annual review and evaluation of their internal controls. Our failure to maintain the effectiveness of our internal controls in accordance with the requirements of the Sarbanes-Oxley Act could have a material adverse effect on our business. We could lose investor confidence in the accuracy and completeness of our financial reports, which could have an adverse effect on the price of our common stock.

***Our ability to use our net operating loss carryforwards to offset future taxable income may be subject to certain limitations***

Our ability to use our net operating loss carryforwards to offset future taxable income may be subject to certain limitations. In general, under Section 382 of the Internal Revenue Code of 1986, as amended (the "Code") a corporation that undergoes an "ownership change" is subject to annual limitations on its ability to use its pre-change net operating loss carryforwards or other tax attributes ("NOLs"), to offset future taxable income or reduce taxes. Our past issuances of stock and other changes in our stock ownership may have resulted in ownership changes within the meaning of Section 382 of the Code; accordingly, our pre-change NOLs may be subject to limitation under Section 382. If we determine that we have not undergone an ownership change, the Internal Revenue Service could challenge our analysis, and our ability to use our NOLs to offset taxable income could be limited by Section 382 of the Code. Future changes in our stock ownership, some of which are outside of our control, could result in ownership changes under Section 382 of the Code further limiting our ability to utilize our NOLs. Furthermore, our ability to use NOLs of companies that we may acquire in the future may be subject to limitations. For these reasons, we may not be able to use a material portion of the NOLs, even if we attain profitability.

***Our business is subject to cybersecurity risks.***

Our operations are increasingly dependent on information technologies and services. Threats to information technology systems associated with cybersecurity risks and cyber incidents or attacks continue to grow, and include, among other things, storms and natural disasters, terrorist attacks, utility outages, theft, viruses, phishing, malware, design defects, human error, and complications encountered as existing systems are maintained, repaired, replaced, or upgraded. Risks associated with these threats include, among other things:

● theft or misappropriation of funds;

● loss, corruption, or misappropriation of intellectual property, or other proprietary, confidential or personally identifiable information (including supplier, clinical data or employee data);

● disruption or impairment of our and our business operations and safety procedures;

● damage to our reputation with our potential partners, patients and the market;

● exposure to litigation;

● increased costs to prevent, respond to or mitigate cybersecurity events.

Although we utilize various procedures and controls to mitigate our exposure to such risk, cybersecurity attacks and other cyber events are evolving and unpredictable. Moreover, we have no control over the information technology systems of third parties conducting our clinical trials, our suppliers, and others with which our systems may connect and communicate. As a result, the occurrence of a cyber incident could go unnoticed for a period of time.

We have cybersecurity insurance coverage in the event we become subject to various cybersecurity attacks, however, we cannot ensure that it will be sufficient to cover any particular losses we may experience as a result of such cyberattacks. Any cyber incident could have a material adverse effect on our business, financial condition and results of operations.

**Risks Related to Regulatory Matters**

***Our product candidates must undergo rigorous nonclinical and clinical testing, and we must obtain regulatory approvals, which could be costly and time-consuming and subject us to unanticipated delays or prevent us from marketing any products. We cannot be certain that any of our current and future product candidates will receive regulatory approval, and without regulatory approval we will not be able to market our product candidates.***

Our ability to generate revenue related to product sales, if ever, will depend on the successful development and regulatory approval of our product candidates. We currently have no products approved for sale, and we cannot guarantee that we will ever have marketable products. The development of a product candidate and issues relating to its approval and marketing are subject to extensive regulation, including regulation for safety, efficacy and quality, by the FDA in the United States and comparable regulatory authorities in other countries, with regulations differing from country to country. The FDA regulations and the regulations of comparable foreign regulatory authorities are wide-ranging and govern, among other things:

● product design, development, manufacture and testing;

● product labeling;

● product storage and shipping;

● pre-market clearance or approval;

● advertising and promotion; and

● product sales and distribution.

Clinical testing can be costly and take many years, and the outcome is uncertain and susceptible to varying interpretations. We cannot predict whether our current or future trials and studies will adequately demonstrate the safety and efficacy of any of our product candidates or whether regulators will agree with our conclusions regarding the preclinical studies and clinical trials we have conducted to date, including the clinical trials for PUR1900. The clinical trials of our product candidates may not be completed on schedule, the FDA or foreign regulatory agencies may order us to stop or modify our research, or these agencies may not ultimately approve any of our product candidates for commercial sale. The data collected from our clinical trials may not be sufficient to support regulatory approval of our various product candidates. Even if we believe the data collected from our clinical trials are sufficient, the FDA has substantial discretion in the approval process and may disagree with our interpretation of the data. If the FDA believes our clinical trials fail to demonstrate the requisite safety and efficacy of a product candidate, we will not obtain regulatory approval.

We are not permitted to market our product candidates in the United States until we receive approval of an NDA from the FDA. Obtaining approval of an NDA is a lengthy, expensive and uncertain process, and we may not be successful in obtaining approval. The FDA review processes can take years to complete and approval is never guaranteed. We cannot be certain that any of our submissions will be accepted for filing and review by the FDA.

The requirements governing the conduct of clinical trials and manufacturing and marketing of our product candidates outside the United States vary widely from country to country. Foreign approvals may take longer to obtain than FDA approvals and can require, among other things, additional testing and different clinical trial designs. Foreign regulatory approval processes include essentially all of the risks associated with the FDA approval processes. Some of those agencies also must approve prices of the products. Approval of a product by the FDA does not ensure approval of the same product by the health authorities of other countries, or vice versa. In addition, changes in regulatory policy in the United States or in foreign countries for product approval during the period of product development and regulatory agency review of each submitted new application may cause delays or rejections.

If we are unable to obtain approval from the FDA or other regulatory agencies for our product candidates, or if, subsequent to approval, we are unable to successfully market and commercialize our product candidates, we will not be able to generate sufficient revenue to become profitable. Furthermore, the introduction of government price controls or other price-reducing regulations may affect the prices we obtain on our product candidates, if approved and commercialized.

***We have limited experience in filing and pursuing applications necessary to gain regulatory approvals, which may impede our ability to obtain timely approvals from the FDA or foreign regulatory agencies, if at all.***

Before obtaining regulatory approval, the FDA requires the sponsor to file a marketing application, which must include all required information detailed in FDA regulations. If the application is incomplete, the FDA may refuse to review the application until the application is complete, which may, for example, require additional clinical trials. As a company, we have no experience in late-stage regulatory filings, such as preparing and submitting NDAs, which may place us at risk of delays, overspending and human resources inefficiencies. Any delay in obtaining, or inability to obtain, regulatory approval could harm our business.

 ****

***Any failure by us to comply with existing or future regulations could harm our reputation and operating results.***

We will be subject to extensive regulation by U.S. federal and state and foreign governments in each of the markets where we intend to sell our product candidates if and after we are approved. If we fail to comply with applicable regulations, including the FDA's pre-or post-approval cGMP requirements, then the FDA or other foreign regulatory authorities could sanction us. Even if a drug is FDA-approved, regulatory authorities may impose significant restrictions on a product's indicated uses or marketing or impose ongoing requirements for potentially costly post-marketing studies.

If a regulatory agency discovers previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility where the product is manufactured, or disagrees with the promotion, marketing or labeling of the product, the regulatory agency may impose restrictions on that product or us, including requiring withdrawal of the product from the market. If we fail to comply with applicable regulatory requirements, a regulatory agency or enforcement authority may:

● issue warning letters;

● impose civil or criminal penalties;

● suspend regulatory approval;

● suspend any of our ongoing clinical trials;

● refuse to approve pending applications or supplements to approved applications submitted by us;

● impose restrictions on our operations, including closing our contract manufacturers' facilities; or

● seize or detain products or require a product recall.

Any government investigation of alleged violations of law could require us to expend significant time and resources in response and could generate negative publicity. Any failure to comply with ongoing regulatory requirements may significantly and adversely affect our ability to commercialize and generate revenue from our product candidates. If regulatory sanctions are applied or if regulatory approval is withdrawn, our value and operating results will be adversely affected. Additionally, if we are unable to generate revenue from sales of our product candidates, our potential for achieving profitability will be diminished and the capital necessary to fund our operations will be increased.

Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses, divert management's attention from the operation of our business and damage our reputation. We expend significant resources on compliance efforts and such expenses are unpredictable and might adversely affect our results. Changing laws, regulations and standards might also create uncertainty, higher expenses and increase insurance costs.

While we believe we understand the current laws and regulations to which our products are and will be subject, laws and regulations are constantly changing, as are administrative interpretations of laws and regulations. If we fail to comply with future changes in laws, regulations, or administrative interpretations, we may be unable to gain regulatory approval. In addition, any changes in current laws or regulations may result in an increase in costs for clinical trials and other requirements to gain regulatory approval. Finally, if we are slow to comply with new laws or regulations, our ability to gain regulatory approval may be substantially delayed.

Recently, President Trump's administration issued a memorandum instructing U.S. executive agencies to prepare for reductions in workforce at governmental agencies, which likely includes the FDA. If the new administration takes action that substantially reduces FDA's workforce, in particular, at the Center for Drug Evaluation and Research, we may face significant delay in obtaining approval and subsequently marketing our product candidates.

***We and our third-party manufacturers are, and will be, subject to regulations of the FDA and other foreign regulatory authorities.***

We and our contract manufacturers are, and will be, required to adhere to laws, regulations and guidelines of the FDA or other foreign regulatory authorities setting forth current good manufacturing practices. These laws, regulations and guidelines cover all aspects of the manufacturing, testing, quality control and recordkeeping relating to our therapeutic candidates. We and our third-party manufacturers may not be able to comply with applicable laws, regulations and guidelines. We and our contract manufacturers are and will be subject to unannounced inspections by the FDA, state regulators and similar foreign regulatory authorities outside the United States. Our failure, or the failure of our third-party manufacturers, to comply with applicable laws, regulations and guidelines could result in the imposition of sanctions on us, including fines, injunctions, civil penalties, refusal of regulatory authorities to grant marketing approval of our therapeutic candidates, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of our therapeutic candidates, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect regulatory approval and supplies of our therapeutic candidates, and materially and adversely affect our business, financial condition and results of operations.

Failure to establish that our manufacturing capabilities are sufficient to comply with FDA regulatory requirements during clinical trials, including cGMP requirements, may result in an inability to gain regulatory approval for our product candidates. While we currently believe our iSPERSE technology will allow us to deliver our product candidates in compliance with FDA cGMPs and other manufacturing regulations, the FDA may disagree. This could result in an inability to receive timely regulatory approval, if at all, for our iSPERSE product candidates.

***Even if we obtain regulatory approvals, our therapeutic candidates will be subject to ongoing regulatory review. If we fail to comply with continuing U.S. and applicable foreign laws, regulations and guidelines, we could lose those approvals, and our business would be seriously harmed.***

Even if our therapeutic candidates receive regulatory approval, we or our commercialization partners, as applicable, will be subject to ongoing reporting obligations, including pharmacovigilance, and the therapeutic candidates and the manufacturing operations will be subject to continuing regulatory review, including inspections by the FDA or other foreign regulatory authorities. The results of this ongoing review may result in the withdrawal of a therapeutic candidate from the market, the interruption of the manufacturing operations and/or the imposition of new product labeling (such as warnings) and/or marketing limitations. Since many more patients are exposed to drugs following their marketing approval, serious but infrequent adverse reactions that were not observed in clinical trials may be observed during the commercial marketing of the therapeutic candidate. In addition, the manufacturer and the manufacturing facilities that we or our commercialization partners use to produce any therapeutic candidate will be subject to periodic review and inspection by the FDA and other foreign regulatory authorities. Later discovery of previously unknown problems with any therapeutic candidate, manufacturer or manufacturing process, or failure to comply with rules and regulatory requirements, may result in actions, including but not limited to the following:

● restrictions on such therapeutic candidate, manufacturer or manufacturing process;

● warning letters from the FDA or other foreign regulatory authorities;

● withdrawal of the therapeutic candidate from the market;

● suspension or withdrawal of regulatory approvals;

● refusal to approve pending applications or supplements to approved applications submitted by us or our commercial partners;

● voluntary or mandatory recall;

● fines;

● refusal to permit the import or export of our therapeutic candidates;

● product seizure or detentions;

● injunctions or the imposition of civil or criminal penalties; or

● adverse publicity.

If we or our commercialization partners, suppliers, third-party contractors or clinical investigators are slow to adapt, or are unable to adapt, to changes in existing regulatory requirements or the adoption of new regulatory requirements or policies, we or our commercialization partners may lose marketing approval for any of our therapeutic candidates if any of our therapeutic candidates are approved, resulting in decreased or lost revenue from milestones, product sales or royalties.

***Our employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements and insider trading.***

We are exposed to the risk of employee fraud or other misconduct. Misconduct by employees could include intentional failures to comply with any regulations applicable to us, to provide accurate information to regulatory authorities, to comply with manufacturing standards we may have established, to comply with federal and state healthcare fraud and abuse laws and regulations, or to report financial information or data accurately or disclose unauthorized activities to us. In particular, sales, marketing and business arrangements in the healthcare industry are subject to extensive laws and regulations intended to prevent fraud, misconduct, kickbacks, self-dealing and other abusive practices. These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements. Employee misconduct could also involve the improper use of information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation. We have adopted a Code of Business Conduct, but it is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risk.

***If we fail to comply with federal or state "fraud and abuse" laws, the failure to comply with these laws may adversely affect our business, financial condition and results of operations.***

In the United States, we will be subject to various federal and state health care "fraud and abuse" laws, including anti-kickback laws, false claims laws and other laws intended to reduce fraud and abuse in the healthcare industry, which could affect us, particularly if we decide to resume development of and successfully commercialize any of our product candidates that receive regulatory approval in the United States. The federal Anti-Kickback Statute makes it illegal for any person, including a prescription drug manufacturer (or a party acting on our behalf), to knowingly and willfully solicit, receive, offer or pay any remuneration in exchange for or to induce the referral of an individual for, or the purchase, order or recommendation of, any good or service, including the purchase, order or prescription of a particular drug for which payment may be made under a federal health care program, such as Medicare or Medicaid. Under federal government regulations, some arrangements, known as safe harbors, are deemed not to violate the federal Anti-Kickback Statute. However, these laws are broadly written, and it is often difficult to determine precisely how the law will be applied in specific circumstances. Accordingly, it is possible that our practices may be challenged under the federal Anti-Kickback Statute. False claims laws prohibit anyone from knowingly and willfully presenting or causing to be presented for payment to third-party payors, including government payors, claims for reimbursed drugs or services that are false or fraudulent, claims for items or services that were not provided as claimed, or claims for medically unnecessary items or services. Cases have been brought under false claims laws alleging that off-label promotion of pharmaceutical products or the provision of kickbacks has resulted in the submission of false claims to governmental healthcare programs. Under the Health Insurance Portability and Accountability Act of 1996, we are prohibited from knowingly and willfully executing a scheme to defraud any healthcare benefit program, including private payors, or knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services. Violations of fraud and abuse laws may be punishable by criminal and/or civil sanctions, including fines, penalties and/or exclusion or suspension from federal and state healthcare programs such as Medicare and Medicaid and debarment from contracting with the U.S. government. In addition, private individuals have the ability to bring actions on behalf of the government under the federal False Claims Act as well as under the false claims laws of several states.

Many states have adopted laws similar to the federal Anti-Kickback Statute, some of which apply to the referral of patients for, or purchase, order or recommendation of, goods or services reimbursed by any source, not just governmental payors. The scope and enforcement of these laws are uncertain and subject to change in the current environment of healthcare reform. We cannot predict the impact on our business, financial condition nor results of operations of any changes in these laws. Any state or federal regulatory review of us, regardless of the outcome, would be costly and time-consuming. Law enforcement authorities are increasingly focused on enforcing these laws, and if we are challenged under of one of these laws, we could be required to pay a fine and/or penalty and could be suspended or excluded from participation in federal or state healthcare programs, and our business, results of operations and financial condition may be adversely affected.

***Legislative or regulatory reform of the U.S. healthcare system may adversely affect our business.***

In the United States, there have been a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could, among other things, impact our business and any of the product candidates we may resume the development of, including: preventing or delaying marketing approval of our product candidates, restrict or regulate post-approval activities and affect our ability, or the ability of any future collaborators, to profitably sell any drugs for which we, or they, obtain marketing approval. We expect that current laws, as well as other healthcare reform measures that may be adopted in the future, may result in more rigorous coverage criteria, additional downward pressure on the price, and/or unfavorable reimbursement rates that we, or any future collaborators, may receive for any product candidates and our business could be materially harmed.

On March 23, 2010, President Obama signed the "Patient Protection and Affordable Care Act" (P.L. 111-148) (the "ACA") and on March 30, 2010, he signed the "Health Care and Education Reconciliation Act" (P.L. 111-152), collectively commonly referred to as the "Healthcare Reform Law." The Healthcare Reform Law included a number of new rules regarding health insurance, the provision of healthcare, conditions to reimbursement for healthcare services provided to Medicare and Medicaid patients, and other healthcare policy reforms. Through the law-making process, substantial changes have been and continue to be made to the current system for paying for healthcare in the U.S., including changes made to extend medical benefits to certain Americans who lacked insurance coverage and to contain or reduce healthcare costs (such as by reducing or conditioning reimbursement amounts for healthcare services and drugs, and imposing additional taxes, fees, and rebate obligations on pharmaceutical and medical device companies). This legislation was one of the most comprehensive and significant reforms ever experienced by the U.S. in the healthcare industry and has significantly changed the way healthcare is financed by both governmental and private insurers. This legislation has impacted the scope of healthcare insurance and incentives for consumers and insurance companies, among others. Additionally, the Healthcare Reform Law's provisions were designed to encourage providers to find cost savings in their clinical operations. Pharmaceuticals represent a significant portion of the cost of providing care. This environment has caused changes in the purchasing habits of consumers and providers and resulted in specific attention to the pricing negotiation, product selection and utilization review surrounding pharmaceuticals which could result in lower pricing and/or reduced market acceptance for any drug products we may commercialize in the U.S. in the future. At this stage, it is difficult to estimate the full extent of the direct or indirect impact of the Healthcare Reform Law on us.

Further, the healthcare regulatory environment has seen significant changes in recent years and is still in flux. Legislative initiatives to modify, limit, replace, or repeal the ACA and judicial challenges have continued for over a decade. However, as of the Supreme Court's ruling ordering the dismissal of, arguably, the most promising case challenging the ACA to-date on June 17, 2021, it appears that the ACA will remain in-effect in its current form for the foreseeable future; however, we cannot predict what additional challenges may arise in the future, the outcome thereof, or the impact any such actions may have on our business.

Additionally, the American Rescue Plan Act of 2021 was signed into law on March 11, 2021, which, in relevant part, eliminates the statutory Medicaid drug rebate cap, currently set at 100% of a drug's average manufacturer price, for single source drugs and innovator multiple source drugs, beginning January 1, 2024. And, in August 2022, the Inflation Reduction Act ("IRA") was signed into law, which, among other things, allows HHS to negotiate the selling price of certain drugs and biologics that CMS reimburses under Medicare Part B and Part D, although only high-expenditure single-source drugs that have been approved for at least 7 years (11 years for biologics) can be selected by CMS for negotiation, with the negotiated price taking effect two years after the selection year. The negotiated prices, which first became effective in January 1, 2026, will be capped at a statutory ceiling price. Beginning in October 2023, the IRA also began penalizing drug manufacturers that increase prices of Medicare Part B and Part D drugs at a rate greater than the rate of inflation. The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years. Manufacturers that fail to comply with the IRA may be subject to various penalties, including civil monetary penalties. Since the enactment of the IRA, several pharmaceutical manufacturers and other industry stakeholders have initiated and continue to pursue lawsuits challenging the constitutionality and implementation of the IRA's drug price negotiation provisions. It is uncertain how the drug pricing provisions imposed by the IRA, or results on any related litigation, will impact the broader pharmaceutical industry or our business.

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In addition, prior presidential administrations as well as the current administration have taken pursued a range of initiatives to address drug pricing and access. For example, President Trump in his second term has signed multiple executive orders addressing drug pricing including: on April 15, 2025, outlining several actions the Secretary of the Department of HHS must take to optimize healthcare regulations that will provide access to prescription drugs at lower costs; on May 5, 2025, aiming to promote domestic production of critical medicines; and on May 12, 2025, aiming to establish a "most favored nation" drug pricing policy that would tie U.S. drug prices to the prices paid for drugs in other countries. Additionally, on November 6, 2025, CMS announced a new voluntary payment initiative called the GENEROUS Model (GENErating cost Reductions for U.S. Medicaid Model) where drug manufacturers may voluntarily offer supplemental rebates to participating state Medicaid programs that are intended to provide such Medicaid programs with a "most favored nation" price for participating manufacturers' products.

At the state level, individual states are increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. A number of states, for example, require drug manufacturers and other entities in the drug supply chain, including health carriers, pharmacy benefit managers, wholesale distributors, to disclose information about pricing of pharmaceuticals, including, but not limited to, information in connection with new product launches that exceed certain levels as identified in the relevant statutes.

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There is uncertainty as to what healthcare programs and regulations may be implemented or changed at the federal and/or state level in the U.S. or the effect of any future legislation or regulation. Furthermore, we cannot assess the future impact that President Trump's second term will have on healthcare programs and regulations or the pharmaceutical industry in general. However, it is possible that such initiatives could have an adverse effect on our ability to obtain approval and/or successfully commercialize any of our product candidates should we decide to resume their development in the future.

**Risks Related to Our Financial Position and Need for Additional Capital**

***We will be required to raise additional capital to fund our operations, and we may not be able to continue as a going concern if we are unable to do so.***

Pharmaceutical product development, which includes research and development, preclinical and clinical studies and human clinical trials, is a time-consuming and expensive process that takes years to complete. Contingent on securing additional funding, we anticipate that our expenses would remain at a high level as we pursue development of PUR3100 and PUR1800 or other iSPERSE*<sup>™</sup>*-based product candidates, and/or pursue development of iSPERSE*<sup>™</sup>*-based pharmaceuticals in additional indications. Based upon our current expectations, we believe that our existing capital resources will enable us to continue planned operations for at least 12 months following the filing date of this Annual Report on Form 10-K. We cannot assure you, however, that our plans will not change or that changed circumstances will not result in the depletion of our capital resources more rapidly than we currently anticipate. We will need to raise additional funds, whether through the sale of equity or debt securities, the entry into strategic business collaborations, the establishment of other funding facilities, licensing arrangements, or asset sales or other means, in order to continue our research and development and clinical trial programs for our iSPERSE*<sup>™</sup>*-based product candidates and to support our other ongoing activities. However, it may be difficult for us to raise additional funds on reasonable terms or at all. Since inception, we have incurred losses each year and have an accumulated deficit of $302.3 million as of December 31, 2025, which may raise concerns about our solvency and affect our ability to raise additional capital.

The amount of additional funds we need will depend on a number of factors, including:

● rate of progress and costs of our clinical trials and research and development activities, including costs of procuring clinical materials and operating our manufacturing facilities;

● our success in establishing strategic business collaborations or other sales or licensing of assets, and the timing and amount of any payments we might receive from any such transactions we are able to establish;

● actions taken by the FDA and other regulatory authorities affecting our products and competitive products;

● our degree of success in commercializing any of our product candidates;

● the emergence of competing technologies and products and other adverse market developments;

● the costs of preparing, filing, prosecuting, maintaining and enforcing patent claims and other intellectual property rights or defending against claims of infringement by others;

● the level of our legal expenses; and

● the costs of discontinuing projects and technologies.

We have raised capital in the past primarily through debt and public offerings and private placements of stock. We may in the future pursue the sale of additional equity and/or debt securities, or the establishment of other funding facilities including asset-based borrowings. There can be no assurances, however, that we will be able to raise additional capital through such an offering on acceptable terms, or at all. Issuances of additional debt or equity securities could impact the rights of the holders of our common stock and may dilute their ownership percentage. Moreover, the establishment of other funding facilities may impose restrictions on our operations. These restrictions could include limitations on additional borrowing and specific restrictions on the use of our assets, as well as prohibitions on our ability to create liens, pay dividends, redeem our stock or make investments.

We also may seek to raise additional capital by pursuing opportunities for the licensing or sale of certain intellectual property and other assets. We cannot offer assurances, however, that any strategic collaborations, sales of securities or sales or licenses of assets will be available to us on a timely basis or on acceptable terms, if at all.

In the event that sufficient additional funds are not obtained through strategic collaboration opportunities, sales of securities, funding facilities, licensing arrangements and/or asset sales on a timely basis, we will be required to reduce expenses through the delay, reduction or curtailment of our projects, including PUR3100, PUR1800 or PUR1900 development activities, or reduction of costs for facilities and administration. Moreover, if we do not obtain such additional funds, doubt may arise about our ability to continue as a going concern and increased risk of insolvency and loss of investment to the holders of our securities. If we are or become insolvent, investors in our stock may lose the entire value of their investment.

***Our long-term capital requirements are subject to numerous risks.***

Our long-term capital requirements are expected to depend on many potential factors, including, among others:

● the number of product candidates in development;

● the regulatory clarity and path of each of our product candidates;

● the progress, success and cost of our clinical trials and research and development programs, including manufacturing;

● the costs, timing and outcome of regulatory review and obtaining regulatory clarity and approval of our product candidates and addressing regulatory and other issues that may arise post-approval;

● the costs of enforcing our issued patents and defending intellectual property-related claims;

● the costs of manufacturing, developing sales, marketing and distribution channels;

● our ability to successfully commercialize our product candidates, including securing commercialization agreements with third parties and favorable pricing and market share; and

● our consumption of available resources more rapidly than currently anticipated, resulting in the need for additional funding sooner than anticipated.

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***We may engage in strategic transactions that could impact our liquidity, increase our expenses and present significant distractions to our management.***

From time to time, we may consider strategic transactions, such as acquisitions of companies, business combinations, asset purchases and out-licensing or in-licensing of products, product candidates or technologies. Additional potential transactions that we may consider include a variety of different business arrangements, including spin-offs, strategic partnerships, joint ventures, restructurings, divestitures, business combinations and investments. Any such transaction may require us to incur non-recurring or other charges, may increase our near- and long-term expenditures and may pose significant integration challenges or disrupt our management or business, which could adversely affect our business, financial condition and results of operations. These transactions may entail numerous operational and financial risks, including:

● exposure to unknown liabilities;

● disruption of our business and diversion of our management's time and attention in order to develop acquired products, product candidates or technologies;

● incurrence of substantial debt or dilutive issuances of equity securities to pay for such transactions;

● higher-than-expected transaction and integration costs;

● write-downs of assets or goodwill or impairment charges;

● increased amortization expenses;

● difficulty and cost in combining the operations and personnel of any acquired businesses or product lines with our operations and personnel;

● impairment of relationships with key suppliers or customers of any acquired businesses or product lines due to changes in management and ownership; and

● inability to retain key employees of any acquired businesses.

Accordingly, although there can be no assurance that we will undertake or successfully complete any transactions of the nature described above, any transactions that we do complete may be subject to the foregoing or other risks and could have a material adverse effect on our business, financial condition and results of operations.

**Risks Related to Our Intellectual Property**

***We may be unable to adequately protect or enforce our rights to intellectual property, causing us to lose valuable rights. Loss of patent rights may lead us to lose market share and anticipated profits.***

Our success, competitive position and future revenues depend, in part, on our ability to obtain patent protection for our products, methods, processes and other technologies, to preserve our trade secrets, to prevent third parties from infringing on our proprietary rights and to operate without infringing the proprietary rights of third parties. Despite our efforts to protect our proprietary technologies and processes, it is possible that competitors or other unauthorized third parties may obtain, copy, use or disclose proprietary technologies and processes.

We try to protect our proprietary position by, among other things, filing U.S., European and other patent applications related to our product candidates, methods, processes and other technologies, to prevent third parties from infringing on our proprietary rights and to operate without infringing the proprietary rights of third parties.

Because the patent position of pharmaceutical companies involves complex legal and factual questions, we cannot predict the validity and enforceability of patents with certainty. Our issued patents may not provide us with any competitive advantages or may be held invalid or unenforceable as a result of legal challenges by third parties or could be circumvented. Our competitors may also independently develop inhaled drug delivery technologies or products similar to iSPERSE*<sup>™</sup>* and iSPERSE*<sup>™</sup>*-based product candidates or design around or otherwise circumvent patents issued to us. Thus, any patents that we own may not provide any protection against competitors. Our pending patent applications, those we may file in the future or those we may license from third parties may not result in patents being issued. Even if these patents are issued, they may not provide us with proprietary protection or competitive advantages. The degree of future protection to be afforded by our proprietary rights is uncertain because legal means afford only limited protection and may not adequately protect our rights or permit us to gain or keep our competitive advantage.

Furthermore, the issuance of a patent, while presumed valid and enforceable, is not conclusive as to its validity or its enforceability and it may not provide us with adequate proprietary protection or competitive advantages against competitors with similar products. Competitors may also be able to design around our patents. Other parties may develop and obtain patent protection for more effective technologies, designs or methods. We may not be able to prevent the unauthorized disclosure or use of our technical knowledge or trade secrets by consultants, vendors, former employees and current employees.

Patent rights are territorial, and accordingly, the patent protection we do have will only extend to those countries in which we have issued patents. Even so, the laws of certain countries do not protect our intellectual property rights to the same extent as do the laws of the United States and the European Union. Competitors may successfully challenge our patents, produce similar drugs or products that do not infringe our patents, or produce drugs in countries where we have not applied for patent protection or that do not respect our patents. Furthermore, it is not possible to know the scope of claims that will be allowed in published applications and it is also not possible to know which claims of granted patents, if any, will be deemed enforceable in a court of law.

We have not pursued or maintained, and may not pursue or maintain in the future, patent protection for our product candidates in every country or territory in which we may sell our products, if approved. The laws of some foreign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States. Consequently, we may not be able to prevent third parties from infringing our patents in all countries outside the United States, or from selling or importing products that infringe our patents in and into the United States or other jurisdictions.

Indeed, several companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of some countries do not favor the enforcement of patents and other intellectual property rights, which could make it difficult for us to stop the infringement, misappropriation or other violation of our intellectual property rights generally. Proceedings to enforce our intellectual property rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful.

After the completion of prosecution and granting of our patents, third parties may still manufacture and/or market therapeutic candidates in infringement of our patent protected rights. Such manufacture and/or market of our product candidates in infringement of our patent protected rights is likely to cause us damage and lead to a reduction in the prices of our product candidates, thereby reducing our anticipated profits.

In addition, due to the extensive time needed to develop, test and obtain regulatory approval for our therapeutic candidates, any patents that protect our product candidate may expire during early stages of commercialization. This may reduce or eliminate any market advantages that such patents may give us. Following patent expiration, we may face increased competition through the entry of generic products into the market and a subsequent decline in market share and profits.

In addition, in some cases we may rely on our licensors to conduct patent prosecution, patent maintenance or patent defense on our behalf. Therefore, our ability to ensure that these patents are properly prosecuted, maintained, or defended may be limited, which may adversely affect our rights in our therapeutic products. Any failure by our licensors or development partners to properly conduct patent prosecution, patent maintenance or patent defense could harm our ability to obtain approval or to commercialize our products, thereby reducing our anticipated profits.

Furthermore, our ability to enforce our patent rights depends on our ability to detect infringement. It is difficult to detect infringers who do not advertise the components that are used in their products. Moreover, it may be difficult or impossible to obtain evidence of infringement in a competitor's or potential competitor's product, particularly in litigation in countries other than the U.S. that do not provide an extensive discovery procedure. Any litigation to enforce or defend our patent rights, if any, even if we were to prevail, could be costly and time-consuming and would divert the attention of our management and key personnel from our business operations. We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded if we were to prevail may not be commercially meaningful.

***If we are unable to protect the confidentiality of our trade secrets or know-how, such proprietary information may be used by others to compete against us.***

In addition to filing patents, we generally try to protect our trade secrets, know-how and technology by entering into confidentiality or non-disclosure agreements with parties that have access to us, such as our development and/or commercialization partners, employees, contractors and consultants. We also enter into agreements that purport to require the disclosure and assignment to us of the rights to the ideas, developments, discoveries and inventions of our employees, advisors, research collaborators, contractors and consultants while employed or engaged by us. However, these agreements can be difficult and costly to enforce or may not provide adequate remedies. Any of these parties may breach the confidentiality agreements and willfully or unintentionally disclose our confidential information, or our competitors might learn of the information in some other way. The disclosure to, or independent development by, a competitor of any trade secret, know-how or other technology not protected by a patent could materially adversely affect any competitive advantage we may have over any such competitor.

To the extent that any of our employees, advisors, research collaborators, contractors or consultants independently develop, or use independently developed, intellectual property in connection with any of our products, disputes may arise as to the proprietary rights to this type of information. If a dispute arises with respect to any proprietary right, enforcement of our rights can be costly and unpredictable, and a court may determine that the right belongs to a third party.

***Legal proceedings or third-party claims of intellectual property infringement and other challenges may require us to spend substantial time and money and could prevent us from developing or commercializing our product candidates.***

Our commercial success also depends upon our ability, and the ability of any third party with which we may partner, to develop, manufacture, market and sell our product candidates and/or products, if approved, and use our patent-protected technologies without infringing the patents of third parties. There is considerable patent litigation in the pharmaceutical industry. As the pharmaceutical industry expands and more patents are issued, we face increased risks that there may be patents issued to third parties that relate to our product candidates and technology of which we are not aware or that we must challenge to continue our operations as currently contemplated.

We may not have identified all patents, published applications or published literature that affect our business either by blocking our ability to commercialize our products or product candidates, by preventing the patentability of one or more aspects of our products or product candidates to us or our licensors, or by covering the same or similar technologies that may affect our ability to market our products and product candidates. For example, we (or the licensor of a product or product candidate to us) may not have conducted a patent clearance search sufficient to identify potentially obstructing third-party patent rights. Moreover, patent applications in the United States are maintained in confidence for up to 18 months after their filing. In some cases, however, patent applications remain confidential in the U.S. Patent and Trademark Office, or the USPTO, for the entire time prior to issuance as a U.S. patent. Patent applications filed in countries outside of the United States are not typically published until at least 18 months from their first filing date. Similarly, publication of discoveries in the scientific or patent literature often lags behind actual discoveries. We cannot be certain that we or our licensors were the first to invent, or the first to file, patent applications covering our products and candidates. We also may not know if our competitors filed patent applications for technology covered by our pending applications or if we were the first to invent the technology that is the subject of our patent applications. Competitors may have filed patent applications or received patents and may obtain additional patents and proprietary rights that block or compete with our patents.

The development, manufacture, use, offer for sale, sale or importation of our product candidates may therefore infringe on the claims of third-party patents or other intellectual property rights. The nature of claims contained in unpublished patent filings around the world is unknown to us, and it is not possible to know which countries patent holders may choose for the extension of their filings under the Patent Cooperation Treaty or other mechanisms. We may also be subject to claims based on the actions of employees and consultants with respect to the usage or disclosure of intellectual property learned at other employers. The cost to us of any intellectual property litigation or other infringement proceeding, even if resolved in our favor, could be substantial. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively because of their substantially greater financial resources. Uncertainties resulting from the initiation, continuation or defense of intellectual property litigation or other proceedings could have a material adverse effect on our ability to compete in the marketplace. Intellectual property litigation and other proceedings may also absorb significant management time. Consequently, we are unable to guarantee that we will be able to manufacture, use, offer for sale, sell or import our therapeutic candidates in the event of an infringement action.

In the event of patent infringement claims, or to avoid potential claims, we may choose or be required to seek a license from a third party and would most likely be required to pay license fees or royalties or both. These licenses may not be available on acceptable terms, or at all. Even if we were able to obtain a license, the rights may be non-exclusive, which could potentially limit our competitive advantage. Ultimately, we could be prevented from commercializing a product candidate or be forced to cease some aspect of our business operations if, as a result of actual or threatened patent infringement or other claims, we are unable to enter into licenses on acceptable terms. This inability to enter into licenses could harm our business significantly.

***We may be subject to other patent-related litigation or proceedings that could be costly to defend and uncertain in their outcome.***

In addition to infringement claims against us, we may in the future become a party to other patent litigation or proceedings before regulatory agencies, including interference, re-examination inter partes review, or post grant review proceedings filed with the U.S. Patent and Trademark Office or opposition proceedings in other foreign patent offices regarding intellectual property rights with respect to our therapeutic candidates, as well as other disputes regarding intellectual property rights with development and/or commercialization partners, or others with whom we have contractual or other business relationships. Post-issuance oppositions are not uncommon and we or our development and/or commercialization partners will be required to defend these opposition procedures as a matter of course. Opposition procedures may be costly, and there is a risk that we may not prevail, which could harm our business significantly.

***Obtaining and maintaining patent protection depends on compliance with various procedures and other requirements, and our patent protection could be reduced or eliminated in case of non-compliance with these requirements.***

Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents and/or applications will be due to the relevant patent agencies in several stages over the lifetime of the patents and /or applications. The relevant patent agencies require compliance with a number of procedural, documentary, fee payment and other provisions during the patent application process. In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. However, there are situations in which the failure to comply with the relevant requirements can result in the abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, our competitors might be able to use our technologies and know-how which could have a material adverse effect on our business, prospects, financial condition and results of operation.

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***If we fail to comply with our obligations under our license agreements, we could lose the rights to intellectual property that is important to our business.***

Our current license agreements impose on us various development obligations, payment of royalties and fees based on achieving certain milestones as well as other obligations. If we fail to comply with our obligations under these agreements, the licensor may have the right to terminate the license. In addition, if the licensor fails to enforce its intellectual property, the licensed rights may not be adequately maintained. The termination of any license agreements or failure to adequately protect such license agreements could prevent us from commercializing our product candidates or possible future products covered by the licensed intellectual property. Any of these events could materially adversely affect our business, prospects, financial condition and results of operation.

***We may be subject to damages resulting from claims that we or our employees have wrongfully used or disclosed alleged trade secrets of their former employers.***

Our employees may have been previously employed at other companies in the industry, including our competitors or potential competitors. Although we are not aware of any claims currently pending against us, we may be subject to claims that these employees or we have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of the former employers of our employees. Litigation may be necessary to defend against these claims. Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management. If we fail in defending such claims, in addition to paying money claims, we may lose valuable intellectual property rights or personnel. A loss of key personnel or their work product could hamper or prevent our ability to commercialize product(s), which would materially adversely affect our commercial development efforts.

**Risks Related to Our Common Stock**

***The price of our common stock is subject to fluctuation and has been and may continue to be volatile.***

The stock market in general, and Nasdaq in particular, as well as biotechnology companies, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of small companies. The market price of our common stock may fluctuate as a result of, among other factors:

● the announcement of new products, new developments, services or technological innovations by us or our competitors;

● actual or anticipated quarterly increases or decreases in revenue, gross margin or earnings, and changes in our business, operations or prospects;

● announcements relating to strategic relationships, mergers, acquisitions, partnerships, collaborations, joint ventures, capital commitments, or other events by us or our competitors;

● conditions or trends in the biotechnology and pharmaceutical industries;

● changes in the economic performance or market valuations of other biotechnology and pharmaceutical companies;

● general market conditions or domestic or international macroeconomic and geopolitical factors unrelated to our performance or financial condition (including, for example, the conflicts in Ukraine and Israel, supply chain and ongoing inflationary pressures and tariff increases);

● purchase or sale of our common stock by stockholders, including executives and directors;

● volatility and limitations in trading volumes of our common stock;

● our ability to obtain financings to conduct and complete research and development activities including, but not limited to, our human clinical trials, and other business activities;

● any delays or adverse developments or perceived adverse developments with respect to the FDA's review of our planned preclinical and clinical trials;

● ability to secure resources and the necessary personnel to conduct clinical trials on our desired schedule;

● failures to meet external expectations or management guidance;

● changes in our capital structure or dividend policy, future issuances of securities, sales or distributions of large blocks of our common stock by stockholders;

● our cash position;

● announcements and events surrounding financing efforts, including debt and equity securities;

● our inability to enter into new markets or develop new products;

● reputational issues;

● analyst research reports, recommendations and changes in recommendations, price targets, and withdrawals of coverage;

● departures and additions of key personnel;

● disputes and litigation related to intellectual property rights, proprietary rights, and contractual obligations;

● changes in applicable laws, rules, regulations, or accounting practices and other dynamics; and

● other events or factors, many of which may be out of our control.

In addition, if the market for stocks in our industry or industries related to our industry, or the stock market in general, experiences a loss of investor confidence, the trading price of our common stock could fluctuate or decline for reasons unrelated to our business, financial condition and results of operations. If any of the foregoing occurs, it could cause our stock price to fall and may expose us to lawsuits that, even if unsuccessful, could be costly to defend and a distraction to management.

***Financial reporting obligations of being a public company in the United States are expensive and time-consuming, and our management may be required to devote substantial time to compliance matters.***

As a publicly traded company, we incur significant additional legal, accounting and other expenses. The obligations of being a public reporting company require significant expenditures, including costs resulting from public company reporting obligations under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations regarding corporate governance practices, including those under the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, and the Nasdaq. These rules require the establishment and maintenance of effective disclosure and financial controls and procedures, internal control over financial reporting and corporate governance practices, among many other complex rules that are often difficult and time consuming to implement, monitor and maintain compliance with. Moreover, despite reforms made possible by the Jumpstart Our Business Startups Act of 2012, the reporting requirements, rules, and regulations will make some activities more time-consuming and costly, particularly as we are no longer an "emerging growth company."

In addition, these rules and regulations make it more difficult and more expensive for us to obtain director and officer liability insurance. Compliance with such requirements also places demands on management's time and attention.

***In the foreseeable future, we do not intend to pay cash dividends on shares of our common stock, except the potential Cash Dividend in connection with the Merger, so any investor gains will be limited to the value of our shares.***

We have not paid dividends to our stockholders since inception. Pursuant to the terms of the Merger Agreement, we may declare and pay the Cash Dividend. The Cash Dividend will be up to an amount equal in the aggregate to our reasonable, good faith approximation of the amount by which Parent Net Cash will exceed the Cash Dividend Amount, provided, that if the Closing Parent Net Cash is greater than $7,000,000, the Cash Dividend Amount shall not exceed (x) $4,500,000 plus (y) an amount equal to (A) 0.5 multiplied by (B) the Closing Parent Net Cash in excess of $7,000,000. There is no guarantee that the Parent Net Cash will exceed $2,500,000. The amount of the Cash Dividend is currently uncertain, pending the determination of our outstanding obligations and net cash position as of the Closing. Other than such potential special cash dividend in connection with the Closing, we do not currently anticipate declaring or paying cash dividends on its capital stock in the foreseeable future.

***We may be at risk of securities class action litigation.***

We may be at risk of securities class action litigation. This risk is especially relevant due to our dependence on positive clinical trial outcomes and regulatory approvals. In the past, biotechnology and pharmaceutical companies have experienced significant stock price volatility, particularly when associated with binary events such as clinical trials and product approvals. If we face such litigation, it could result in substantial costs and a diversion of management's attention and resources, which could harm our business and result in a decline in the market price of our common stock.

***In the event that we fail to satisfy any of the listing requirements of Nasdaq, our common stock may be delisted, which could affect our market price and liquidity.***

Our common stock is listed on Nasdaq. For continued listing on Nasdaq, we will be required to comply with the continued listing requirements, including the minimum market capitalization standard, the minimum stockholders' equity requirement, the corporate governance requirements and the minimum closing bid price requirement, among other requirements. In the event that we fail to satisfy any of the listing requirements of Nasdaq, our common stock may be delisted. If our securities are delisted from trading on the Nasdaq Stock Market, and we are not able to list our securities on another exchange or to have them quoted on the Nasdaq Stock Market, our securities could be quoted on the OTC Markets. As a result, we could face significant adverse consequences including:

● a limited availability of market quotations for our securities;

● a determination that our common stock is a "penny stock," which would require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;

● a limited amount of news and analyst coverage; and

● a decreased ability to issue additional securities (including pursuant to short-form registration statements on Form S-3 or obtain additional financing in the future).

***We may issue additional equity securities in the future, which could result in dilution to existing investors.***

We may seek the additional capital necessary to fund our operations through public or private equity offerings, debt financings, and collaborative and licensing arrangements. To the extent we raise additional capital by issuing equity securities, including in a debt financing where we issue convertible notes or notes with warrants and any shares of our common stock to be issued in a private placement, our stockholders may experience substantial dilution. We may, from time to time, sell additional equity securities in one or more transactions at prices and in a manner we determine. If we sell additional equity securities, existing stockholders may be materially diluted. In addition, new investors could gain rights superior to existing stockholders, such as liquidation and other preferences. In addition, the exercise or conversion of outstanding options or warrants to purchase shares of capital stock may result in dilution to our stockholders upon any such exercise or conversion.

In addition, we have sponsored the Amended and Restated 2013 Employee, Director and Consultant Equity Incentive Plan (the "Incentive Plan"), which expired on June 10, 2025. No new awards may be made under the Incentive Plan after its expiration date. Awards issued under the Incentive Plan prior to its expiration remain outstanding in accordance with their terms. As of December 31, 2025, an aggregate of 33,858 shares of our common stock could be delivered upon the exercise or conversion of outstanding stock options under the Incentive Plan.

We may also issue additional options, warrants and other types of equity in the future as part of stock-based compensation, capital raising transactions, technology licenses, financings, strategic licenses or other strategic transactions. To the extent these options are exercised, existing stockholders would experience additional ownership dilution.

***We currently take advantage of reduced disclosure and governance requirements applicable to smaller reporting companies, which could result in our common stock being less attractive to investors.***

We have a public float of less than $250 million and therefore qualify as a smaller reporting company under the rules of the SEC. As a smaller reporting company, we are able to take advantage of reduced disclosure requirements, such as simplified executive compensation disclosures and reduced financial statement disclosure requirements in our SEC filings. Decreased disclosures in our SEC filings due to our status as a smaller reporting company may make it harder for investors to analyze our results of operations and financial prospects. We cannot predict if investors will find our common stock less attractive if we rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. We may take advantage of the reporting exemptions applicable to a smaller reporting company until we are no longer a smaller reporting company, which status would end once we have a public float greater than $250 million. In that event, we could still be a smaller reporting company if our annual revenues were below $100 million and we have a public float of less than $700 million.

***Anti-takeover provisions under Delaware corporate law may make it difficult for our stockholders to replace or remove our board of directors and could deter or delay third parties from acquiring us, which may be beneficial to our stockholders.***

We are subject to the anti-takeover provisions of Delaware law, including Section 203 of the General Corporation Law of Delaware (the "DGCL"). Under these provisions, if anyone becomes an "interested stockholder," we may not enter into a "business combination" with that person for three (3) years without special approval, which could discourage a third party from making a takeover offer and could delay or prevent a change of control. For purposes of Section 203 of the DGCL, "interested stockholder" means, generally, someone owning fifteen percent (15%) or more of our outstanding voting stock or an affiliate that owned fifteen percent (15%) or more of our outstanding voting stock during the past three (3) years, subject to certain exceptions as described in Section 203 of the DGCL.

***Protective provisions in our charter and bylaws could prevent a takeover which could harm our stockholders.***

Our certificate of incorporation and bylaws contain a number of provisions that could impede a takeover or prevent us from being acquired, including, but not limited to, a classified board of directors and limitations on the ability of our stockholders to remove a director from office without cause. Each of these charter and bylaw provisions give our board of directors the ability to render more difficult or costly the completion of a takeover transaction that our stockholders might view as being in their best interests.

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| **ITEM 1B.** | **UNRESOLVED STAFF COMMENTS.** |

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None.

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| **ITEM 1C.** | **CYBERSECURITY.** |

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We operate in the biopharmaceutical industry, which is subject to various cybersecurity risks that could adversely affect our business, financial condition, and results of operations, including intellectual property theft, fraud, extortion, harm to employees or customers, violation of privacy laws and other litigation and legal risk, and reputational risk. We recognize the critical importance of developing, implementing, and maintaining robust cybersecurity measures to safeguard our information systems and protect the confidentiality, integrity, and availability of our data. We currently have security measures in place to protect information and prevent data loss and other security breaches, including a cybersecurity risk assessment program. Both management and the board of directors are actively involved in the continuous assessment of risks from cybersecurity threats, including prevention, mitigation, detection, and remediation of cybersecurity incidents.

We have established policies and processes for assessing, identifying, and managing material risk from cybersecurity threats, and have integrated these processes into our overall risk management systems and processes. We routinely assess material risks from cybersecurity threats, including any potential unauthorized occurrence on or conducted through our information systems that may result in adverse effects on the confidentiality, integrity, or availability of our information systems or any information residing therein.

Our current cybersecurity risk assessment program includes identification of reasonably foreseeable internal and external risks, the likelihood and potential damage that could result from such risks, and the sufficiency of existing policies, procedures, systems, and safeguards in place to manage such risks. The program outlines governance, policies and procedures, and technology we use to oversee and identify risks from cybersecurity threats and is informed by previous cybersecurity incidents we have observed in our industry.

Following these risk assessments, we re-design, implement, and maintain reasonable safeguards to minimize identified risks; reasonably address any identified gaps in existing safeguards; and regularly monitor the effectiveness of our safeguards. Primary responsibility for the day-to-day assessment and management of risks from cybersecurity, including the prevention, mitigation, detection, and remediation of cybersecurity incidents, rests with an IT consultant who reports to management.

As part of our overall risk management system, we monitor and test our safeguards and train our employees on these safeguards. Personnel at all levels and departments are made aware of our cybersecurity policies through trainings.

We engage consultants, or other third parties in connection with our risk assessment processes. These service providers assist us to design and implement our cybersecurity policies and procedures, as well as to monitor and test our safeguards. We require each third-party service provider to certify that it has the ability to implement and maintain appropriate security measures, consistent with all applicable laws, to implement and maintain reasonable security measures in connection with their work with us, and to promptly report any suspected breach of its security measures that may affect our company.

One of the key functions of our board of directors is informed oversight of our risk management process, including risks from cybersecurity threats. Our board of directors is responsible for monitoring and assessing strategic risk exposure, and our executive officers are responsible for the day-to-day management of the material risks we face. Our board of directors administers its cybersecurity risk oversight function directly as a whole, as well as through the audit committee.

To date, no cybersecurity incident (or aggregation of incidents) or cybersecurity threat has materially affected our results of operations or financial condition. However, an actual or perceived breach of our security could damage our reputation, interfere with the progress of our clinical trials, interfere with our efforts to pursue regulatory approvals for our product candidates, or subject us to third-party lawsuits, regulatory fines or other actions or liabilities, any of which could adversely affect our business, operating results or financial condition. We have attempted to preemptively mitigate the financial impact of any cybersecurity incident and currently maintain a cyber liability insurance policy. However, our cyber liability insurance may be inadequate or may not be available in the future on acceptable terms, or at all. In addition, our cyber liability insurance policy may not cover all claims made against us, and defending a suit, regardless of its merit, could be costly and divert management's attention from our business and operations. For further information regarding risks from cybersecurity threats, please refer to "Item 1A. RISK FACTORS—Risks Related to Our Business."

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| **ITEM 2.** | **PROPERTIES.** |

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We are a virtual company and do not lease or own any physical space. We maintain a mailing address at 945 Concord Street, Suite 1217, Framingham, Massachusetts 01701.

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| **ITEM 3.** | **LEGAL PROCEEDINGS.** |

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From time to time, we may be involved in litigation that arises through the normal course of business. As of the date of this filing, we are not aware of any material legal proceedings to which we or our subsidiaries are a party or to which any of our property is subject, nor are we aware of any such threatened or pending litigation or proceedings known to be contemplated by governmental authorities.

To our knowledge, there are no material proceedings in which any of our directors, officers or affiliates or any registered or beneficial stockholder of more than 5% of our common stock, or any associate of any of the foregoing, is an adverse party or has a material interest adverse to our interest.

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| **ITEM 4.** | **MINE SAFETY DISCLOSURES.** |

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Not applicable.

**PART II**

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| **ITEM 5.** | **MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.** |

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**Market Information**

Our common stock trades on The Nasdaq Capital Market under the symbol "PULM".

**Stockholders**

As of February 23, 2026, there were approximately 43 stockholders of record of our common stock.

**Dividends**

We have not paid dividends to our stockholders since inception. Pursuant to the terms of the Merger Agreement, Pulmatrix may declare and pay a special cash dividend to Pulmatrix stockholders of record prior to the Merger. The Cash Dividend will be up to an amount equal in the aggregate to Pulmatrix's reasonable, good faith approximation of the amount by which Pulmatrix's Net Cash will exceed the Cash Dividend Amount, provided, that if the Closing Pulmatrix Net Cash is greater than $7,000,000, the Cash Dividend Amount shall not exceed (x) $4,500,000 plus (y) an amount equal to (A) 0.5 multiplied by (B) the Closing Pulmatrix Net Cash in excess of $7,000,000. There is no guarantee that the Pulmatrix Net Cash will exceed $2,500,000. The amount of the Cash Dividend is currently uncertain, pending the determination of Pulmatrix's outstanding obligations and net cash position as of the Closing. Other than such potential special cash dividend in connection with the Closing, Pulmatrix does not currently anticipate declaring or paying cash dividends on its capital stock in the foreseeable future.

**Unregistered Sales of Securities**

None.

**Issuer Purchases of Equity Securities**

Not applicable.

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| **ITEM 6.** | **RESERVED.** |

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| **ITEM 7.** | **MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.** |

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*The information set forth below should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Annual Report on Form 10-K. This discussion and analysis contain forward-looking statements based on our current expectations, assumptions, estimates and projections. These forward-looking statements involve risks and uncertainties. Our actual results could differ materially from those indicated in these forward-looking statements as a result of certain factors, including those discussed in Item 1 of this Annual Report on Form 10-K, entitled "Business," under "Forward-Looking Statements" and Item 1A of this Annual Report on Form 10-K, entitled "Risk Factors." References in this discussion and analysis to "us," "we," "our," or our "Company" refer to Pulmatrix, Inc., a Delaware corporation, and our subsidiaries, Pulmatrix Operating Company, Inc. and PCL Merger Sub, Inc., both Delaware corporations, and PCL Merger Sub II, LLC, a Delaware limited liability company.*

**Overview**

We are a biopharmaceutical company that has focused on the development of novel inhaled therapeutic products intended to prevent and treat migraine and respiratory diseases with important unmet medical needs using our patented iSPERSE™ technology. Our proprietary product pipeline includes treatments for central nervous system ("CNS") disorders such as acute migraine and serious lung diseases such as Chronic Obstructive Pulmonary Disease ("COPD") and allergic bronchopulmonary aspergillosis ("ABPA"). Our product candidates are based on our proprietary engineered dry powder delivery platform, iSPERSE™, which seeks to improve therapeutic delivery to the lungs by optimizing pharmacokinetics and reducing systemic side effects to improve patient outcomes.

We design and develop inhaled therapeutic products based on our proprietary dry powder delivery technology, iSPERSE™, which enables delivery of small or large molecule drugs to the lungs by inhalation for local or systemic applications. The iSPERSE™ powders are engineered to be small, dense particles with highly efficient dispersibility and delivery to airways. iSPERSE™ powders can be used with an array of dry powder inhaler technologies and can be formulated with a broad range of drug substances including small molecules and biologics. We believe the iSPERSE™ dry powder technology offers enhanced drug loading and delivery efficiency that outperforms traditional lactose-blend inhaled dry powder therapies.

We believe the advantages of using the iSPERSE™ technology include reduced total inhaled powder mass, enhanced dosing efficiency, reduced cost of goods, and improved safety and tolerability profiles.

After a comprehensive review of strategic alternatives, including identifying and reviewing potential candidates for a strategic transaction, on November 13, 2024, we entered into the Agreement and Plan of Merger and Reorganization, as amended by Amendment No. 1 ("Amendment No. 1") thereto on April 7, 2025 (as amended by Amendment No. 1, the "Merger Agreement"), pursuant to which, among other matters, PCL Merger Sub, Inc., our direct wholly owned subsidiary, will merge with and into Cullgen Inc. ("Cullgen"), with Cullgen surviving as our wholly owned subsidiary and the surviving corporation of the merger (the "Merger"). The Merger Agreement was unanimously approved by our board of directors, which resolved to recommend approval of the Merger Agreement to our stockholders.

On June 16, 2025, we held a special meeting in lieu of the annual meeting of Pulmatrix stockholders, at which special meeting our stockholders approved the Merger and related proposals. The Closing is subject to other customary closing conditions, including Nasdaq's approval of the listing of the shares of Pulmatrix common stock to be issued in connection with the Merger and approval from the China Securities Regulatory Commission ("CSRC") pursuant to the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Enterprises (the "Trial Measures"), No. 1 to No. 6 Supporting Guidance Rules, the Notice on Administration Arrangements for the Filing of Overseas Listings by Domestic Enterprises and the relevant CSRC Answers to Reporter Questions on the official website of the CSRC. These regulations established a filing-based regime to regulate overseas offerings and listings by Chinese domestic companies. As of the date of this filing, we have not yet received approval from the CSRC to complete the Merger. As previously disclosed, on August 1, 2025, we and Cullgen, as provided for in the Merger Agreement, mutually agreed to extend the "End Date", a term defined in the Merger Agreement, by 60 days from August 13, 2025, to October 12, 2025. The Merger Agreement does not have a defined term and does not terminate on the "End Date". The "End Date" is simply the date at which certain termination options become available to either party.

On December 17, 2025, the Company, Cullgen and PLC Merger Sub, Inc. (collectively, the "Parties") entered into a mutual waiver agreement (the "Waiver Agreement"), pursuant to which the Parties agreed to mutually waive compliance with Section 5.4 of the Merger Agreement, which such provision imposes restrictions on each party during the Pre-Closing Period (as defined in the Merger Agreement). Except as expressly waived pursuant to the Waiver Agreement, the Merger Agreement remains in full force and effect in all respects, and no other provision of the Merger Agreement has otherwise been amended, waived, or modified.

If the Merger is completed, the business of Cullgen will continue as the business of the combined company. We are currently seeking opportunities to monetize iSPERSE™ and our existing clinical assets.

Our future operations are highly dependent on the success of the Merger and there can be no assurances that the Merger will be successfully consummated. There can be no assurance that the strategic review process or any transaction relating to a specific asset, including the Merger and any asset sale, will result in us pursuing such a transaction, or that any transactions, if pursued, will be completed on terms favorable to us and our stockholders in the existing Pulmatrix entity or any possible entity that results from a combination of entities. If the strategic review process is unsuccessful, and if the Merger is not consummated, the Pulmatrix board of directors may decide to pursue a dissolution and liquidation of the Company.

Our goal has been to develop breakthrough therapeutic products that are safe, convenient, and more effective than the existing therapeutic products for respiratory and other diseases where iSPERSE™ properties are advantageous.

Our current pipeline of clinical assets is aligned to this goal and includes iSPERSE™-based therapeutic candidates, which target the prevention and treatment of a range of diseases, including CNS disorders and pulmonary diseases. These therapeutic candidates include PUR3100 for the treatment of acute migraine, PUR1800 for the treatment of acute exacerbations of chronic obstructive pulmonary disease ("AECOPD"), and PUR1900 for the treatment of ABPA in patients with asthma and in patients with cystic fibrosis. Each program is enabled by its unique iSPERSE™ formulation designed to achieve specific therapeutic objectives.

In connection with the Merger, we are exploring opportunities to monetize these clinical assets and have paused the development of these product candidates. Continued development of these candidates, if that were to occur, would be contingent on securing additional funding and would require significant expenditures to advance. Thereafter, if development of such product candidates were to be continued and successfully advanced (of which there can be no assurance), it would be necessary to seek and obtain marketing approval to commercialize such product candidates, which could be expected to require the expenditure of significant additional resources and expenses related to regulatory, product sales, medical affairs, marketing, manufacturing and distribution.

Contingent on securing additional funding and continuing development of these candidates, we would expect to continue to incur substantial expenses and operating losses for at least the next several years, as we would:

● *Pursue further clinical studies for PUR3100, an orally inhaled dihydroergotamine ("DHE") including a Phase 2 clinical study for the treatment of acute migraine. We received Food and Drug Administration ("FDA") acceptance of our Investigational New Drug Application ("IND") and a "study may proceed" letter in September 2023, positioning PUR3100 as Phase 2-ready for potential financing or partnership discussions.* 

● *Pursue partnership or other alternatives to monetize or advance PUR1800, focusing on the development of an orally inhaled kinase inhibitor for treatment of AECOPD.* 

● *Capitalize on our proprietary iSPERSE™ technology and our expertise in inhaled therapeutics and particle engineering to identify new product candidates for prevention and treatment of diseases, including those with important unmet medical needs.* 

● *Invest in protecting and expanding our intellectual property portfolio and file for additional patents to strengthen our intellectual property rights.* 

● *Seek partnerships and license agreements to support the product development and commercialization of our product candidates.* 

We do not have any products approved for sale and have not generated any revenue from product sales. We will not generate product sales unless and until we successfully complete clinical developments and obtain regulatory approvals for our product candidates. Additionally, we currently utilize third-party contract research organizations ("CROs") to carry out our clinical development activities and third-party contract manufacturing organizations ("CMOs") to carry out our clinical manufacturing activities as we do not yet have a commercial organization. If we obtain regulatory approval for any of our product candidates, we expect to incur substantial expenses related to developing our internal commercialization capability to support product sales, marketing and distribution. Accordingly, we anticipate that we will seek to fund our operations through public or private equity or debt financings, licensing arrangements, collaborations with third parties, non-dilutive grants or other sources, potentially including collaborative commercial arrangements. Likewise, we intend to seek to limit our commercialization costs by partnering with other companies with complementary capabilities or larger infrastructure including sales and marketing.

Because of the numerous risks and uncertainties associated with product development, we are unable to predict the timing or amount of increased expenses or when or if we will be able to achieve or maintain profitability. Even if we are able to generate product sales, we may not become profitable. If we fail to become profitable or are unable to sustain profitability on a continuing basis, we may be unable to continue our operations at planned levels and be forced to reduce or terminate our operations.

**Therapeutic Candidates**

*PUR3100*

We are currently exploring opportunities to monetize PUR3100.

In 2020, we developed PUR3100, the iSPERSE<sup>™</sup> formulation of DHE, for the treatment of acute migraine. Currently DHE is only available as subcutaneous, intravenous infusion or intranasal delivery. If approved for commercialization, PUR3100 has the opportunity to be the first orally inhaled DHE treatment for acute migraine and an alternative to other acute therapies. Given the oral inhaled route of delivery, PUR3100 is anticipated to provide rapid relief from migraine symptoms and provide a favorable tolerability profile.

A total of three 14-day GLP toxicology studies have been completed with PUR3100 to support single-dose clinical studies. We are planning to conduct a chronic toxicology study to support long-term dosing. Based on discussions with the FDA, this would complete the non-clinical requirements to support an NDA.

Our interactions with the FDA have indicated that, as part of Phase 2 and Phase 3 studies, long-term safety should be assessed in a minimum of one hundred patients for six months of dosing and fifty patients for twelve months of dosing. The FDA also confirmed that it will be necessary to perform a safety study administering PUR3100 to otherwise healthy patients with asthma before an NDA is submitted.

On September 26, 2022, we announced the completion of patient dosing in a Phase 1 clinical study, performed in Australia. The study design was a double-dummy, double-blinded trial to assess the safety, tolerability, and pharmacokinetics of three dose levels of single doses of inhaled PUR3100 with IV placebo, as compared to IV DHE (DHE mesylate injection) with inhaled placebo. This study may also provide preliminary comparative bioavailability data to support the use of the 505(b)(2) pathway for marketing authorization. Twenty-six healthy subjects were enrolled and each of the four groups contained at least six subjects.

On January 4, 2023, we announced topline results. We presented the Phase 1 study data at the American Headache Society 65th Annual Meeting in June 2023. The study showed that PUR3100 achieved peak exposures in the targeted therapeutic range and time to maximum concentration occurred at five minutes after dosing at all dosing levels. The PUR3100 dose groups also showed a lower incidence of nausea and no vomiting compared to observations of nausea and vomiting in the IV administered DHE dose group.

Based on the rapid systemic exposure in the therapeutic range and the improved side effect profile relative to IV dosing, we believe the PUR3100 formulation of DHE may differentiate from approved DHE products or those known to be in development. If effectiveness is demonstrated, PUR3100 may offer the convenience of being self-administered with a pharmacokinetic profile that may potentially provide rapid onset of action.

In September 2023, we announced that the FDA accepted the PUR3100 IND and the receipt of a "study may proceed" letter for the clinical study: "A Phase 2, Multicenter, Randomized, Double-Blind, Placebo-Controlled, Single Event Study to Evaluate the Safety, Tolerability, and Efficacy of PUR3100 (Dihydroergotamine Mesylate Inhalation Powder) in the Acute Treatment of Migraine". We anticipate that this Phase 2 clinical study will initiate once financing or partnership arrangements have been made.

On May 15, 2024, we announced publication of, "Safety, tolerability, and pharmacokinetics of a single orally inhaled dose of PUR3100, a dry powder formulation of dihydroergotamine versus intravenous dihydroergotamine: A Phase 1 randomized, double-blind study in healthy adults" in the peer-reviewed publication *Headache: The Journal of Head and Face Pain*.

We believe that in this trial, PUR3100 demonstrated the potential for rapid pain relief and improved DHE tolerability versus IV DHE. With a T<sub>max</sub> of 5 minutes and a C<sub>max</sub> in the therapeutic window for all doses tested, we believe that PUR3100 has the potential to address an unmet need for acute migraine sufferers and we are pursuing different options to advance PUR3100 into a Phase 2 clinical trial to further investigate its promising profile in treating acute migraine.

The completed Phase 1 study demonstrated optimal pharmacokinetics and improved tolerability of PUR3100 compared to IV DHE. All doses of PUR3100 were generally well tolerated with a lower incidence of nausea (21% vs. 86%), vomiting (0% vs. 29%), and headache (16% vs. 57%) compared to IV DHE. The PK profile of PUR3100 versus IV DHE was characterized by a similar mean time to C<sub>max</sub> (5 vs. 5.5 min), with reduced AUC<sub>0–2h</sub> (1120–4320 vs. 6340 ng\*h/mL), and a lower C<sub>max</sub> (3620–14,400 vs. 45,000 ng/mL). All doses of PUR3100 were associated with mean C<sub>max</sub> above the minimum level required to achieve efficacy (1000 pg/mL).

*PUR1800*

We are currently exploring opportunities to monetize PUR1800.

PUR1800 is a Narrow Spectrum Kinase Inhibitor, engineered with our iSPERSE<sup>™</sup> technology, being developed for the treatment of acute exacerbations in chronic obstructive pulmonary disease (AECOPD). PUR1800 targets p38 MAP kinases (p38MAPK), Src kinases, and Syk kinases. These kinases play a critical role in chronic inflammation and airway remodeling.

We completed a Phase 1b safety, tolerability, and pharmacokinetics of PUR1800 in patients with stable moderate-severe COPD. Topline data were delivered in the first quarter of 2022 and presented at the American Academy of Allergy, Asthma and Immunology conference in the first quarter of 2023.

The clinical study, performed at the Medicines Evaluation Unit in Manchester, UK, was a randomized, three-way crossover double-blind study with 14 days of daily dosing, which included placebo and one of two doses of PUR1800, and included a 28-day follow-up period after each treatment period. A total of 18 adults with stable COPD were enrolled. Safety and tolerability, as well as systemic pharmacokinetics ("PK") were evaluated.

PUR1800 was well tolerated and there were no observed safety signals. The PK data indicate that PUR1800 results in low and consistent systemic exposure when administered via oral inhalation. The topline data, along with the results from chronic toxicology studies, support the continued development of PUR1800 for the treatment of AECOPD and other inflammatory respiratory diseases. These data will inform the design of a potential Phase 2 study in the treatment of AECOPD.

Toxicology studies in rats and dogs, with durations of six and nine months respectively, are complete. The data from both studies demonstrated that PUR1800 is safe and well tolerated with chronic dosing, with little to no progression of findings from 28-day studies. We believe that this indicates potential for chronic dosing of PUR1800, enabling us to explore PUR1800 therapy for chronic respiratory diseases such as steroid resistant asthma, COPD, or idiopathic pulmonary fibrosis. While the program is currently in development for treatment of acute exacerbation of COPD, these positive toxicology study results could expand potential indications and value of the program.

*PUR1900*

We are currently exploring opportunities to monetize PUR1900 within the United States.

On April 15, 2019, we entered into a Development and Commercialization Agreement (the "Cipla Agreement") with Cipla for the co-development and commercialization, on a worldwide, except for the Cipla Territory defined below, exclusive basis, of PUR1900, our inhaled iSPERSE*<sup>™</sup>* drug delivery system (the "Product") enabled formulation of the antifungal drug itraconazole, which is only available as an oral drug, for the treatment of all pulmonary indications, including ABPA in patients with asthma. We entered into an amendment to the Cipla Agreement on November 8, 2021 (the "Second Amendment") and a subsequent amendment on January 6, 2024 (the "Third Amendment"). All references to the Cipla Agreement herein refer to the Cipla Agreement, as amended. The Cipla Agreement will remain in effect in perpetuity, unless otherwise earlier terminated in accordance with its terms.

Pursuant to the Third Amendment, all development and commercialization activities with respect to the Product in all markets other than the United States (the "Cipla Territory") will be conducted exclusively by Cipla at Cipla's sole cost and expense, and Cipla shall be entitled to all profits from the sale of the Product in the Cipla Territory, except that we will receive 2% royalties on any potential future net sales by Cipla outside the United States.

Also pursuant to the Third Amendment, we and Cipla stopped patient enrollment for the ongoing Phase 2b clinical study. We agreed that during the period commencing on January 6, 2024 and ending July 30, 2024 (the "Wind Down Period"), we would complete all Phase 2b activities, assign or license all patents to Cipla and their registration with the appropriate authorities in the Cipla Territory, complete a physical and demonstrable technology transfer and secure all data from the Phase 2b study for inclusion in the safety database for the Cipla Territory.

We completed all Phase 2b wind down activities in the third quarter of 2024. As such, we no longer bear further financial responsibility for the commercialization and development with respect to the Product in the Cipla Territory, with such commercialization and development expenses of the Product in the Cipla Territory to be borne at Cipla's sole cost and expense after January 6, 2024.

Our partner Cipla has continued clinical development outside the United States and India's Central Drug Standard Control Organization has accepted Cipla's Phase 2 clinical trial results for inhaled itraconazole dry powder formulation and approved the company's proposal to proceed with Phase 3 trials. Should Cipla successfully market PUR1900 outside the United States, Pulmatrix will receive 2% royalties on any potential future net sales by Cipla outside the United States. Within the United States, we and Cipla will seek to monetize PUR1900 for indications where an orally inhaled antifungal may provide a therapeutic benefit or fulfill an unmet medical need.

**Financial Overview**

***Revenues***

To date, we have not generated any product sales. No revenues were recognized for the year ended December 31, 2025. Revenue recognized for the year ended December 31, 2024, were primarily generated from the Cipla Agreement as related to our PUR1900 program, for which wind down activities have been completed.

For more discussion on the Cipla Agreement, please see Note 5, *Significant Agreements*, to our consolidated financial statements included in this report.

***Research and Development Expenses***

We expense research and development costs to operations as incurred. Research and development activities have been central to our business model. We have utilized a combination of internal and external efforts to advance product development from early-stage work to clinical trial manufacturing and clinical trial support. External efforts have included work with consultants and substantial work at contract research and manufacturing organizations. We have historically supported an internal research and development team and facility for our pipeline and other potential development programs, however following the closing of the transaction with MannKind Corporation ("MannKind" and such transactions, the "MannKind Transaction") in the year ended December 31, 2024, the majority of our research and development employees were terminated and our facility lease was assigned to MannKind. Going forward, we expect to utilize external resources for further development. Additionally, a Master Services Agreement between the Company and MannKind calls for MannKind to provide certain development services to the Company, including but not limited to, activities to develop dry powder formulations using iSPERSE™.

To continue development of existing programs or opportunities identified for iSPERSE™ in any new indications, we will need to secure additional funding and anticipate additional development costs would be incurred. Because of the numerous risks and uncertainties associated with product development, however, we cannot determine with certainty the duration and completion costs of these or other current or future preclinical studies and clinical trials. The duration, costs and timing of our future clinical trials and development of our product candidates will depend on a variety of factors, including the selected development path and uncertainties associated with clinical and preclinical studies, clinical trial enrollment rates and changing government regulation. In addition, the probability of success for each product candidate will depend on numerous factors, including competition, manufacturing capability and commercial viability.

***General and Administrative Expenses***

General and administrative expenses consist principally of salaries, benefits and related costs such as stock-based compensation for personnel and consultants in executive, finance, business development, corporate communications and human resource functions, facility costs not otherwise included in research and development expenses, patent filing fees and legal fees. Other general and administrative expenses include travel expenses, expenses related to being a publicly traded company, professional fees for consulting, auditing and tax services, and expenses related to the Company's exploration of strategic alternatives, including the Merger.

**Critical Accounting Estimates**

Our management's discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP"). The preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements. We base our estimates on historical experience, known trends and events, and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. Actual results may differ from these estimates under different assumptions or conditions.

Our significant accounting policies are described in the notes to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K. As we wound down ongoing clinical programs, in the year ended December 31, 2025, we have no critical accounting estimates which involve a significant level of uncertainty at the time the estimate was made, nor estimates for which changes in them have had or are reasonably likely to have a material effect on our financial condition or results of operations.

**Results of Operations**

***Comparison of the Years Ended December 31, 2025 and 2024***

The following table sets forth our results of operations for each of the periods set forth below (in thousands):

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| | | | |
|:---|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** | |
|  | **2025** | **2024** |<br>**Change** |
| **Revenues** | $- | $7806 | $(7806) |
| **Operating expenses:** |  |  |  |
| &nbsp;&nbsp;&nbsp;Research and development | 38 | 7166 | (7128) |
| &nbsp;&nbsp;&nbsp;General and administrative | 5131 | 7785 | (2654) |
| &nbsp;&nbsp;&nbsp;Loss on MannKind Transaction | - | 2618 | (2618) |
| Total operating expenses | 5169 | 17569 | (12400) |
| Loss from operations | (5169) | (9763) | 4594 |
| **Other income (expense):** |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 144 | 467 | (323) |
| &nbsp;&nbsp;&nbsp;Fair value adjustment of warrants | 67 | (67) | 134 |
| &nbsp;&nbsp;&nbsp;Other expense, net | (204) | (196) | (8) |
| Net loss | $(5162) | $(9559) | $4397 |

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***Revenues*** — No revenues were recognized for the year ended December 31, 2025, as compared to $7.8 million for the year ended December 31, 2024, a decrease of $7.8 million. The decrease is primarily related to completion of the wind down of the PUR1900 Phase 2b clinical trial during the year ended December 31, 2024.

***Research and development expenses*** — Research and development expenses were less than $0.1 million for the year ended December 31, 2025, as compared to $7.2 million for the year ended December 31, 2024, a decrease of approximately $7.1 million. The decrease was primarily due to $5.0 million less employment and other costs following the MannKind Transaction and $2.1 million less cost incurred on the PUR1900 program, for which the winding down of the Phase 2b clinical trial was completed during the year ended December 31, 2024.

 ****

***General and administrative expenses*** — General and administrative expenses were $5.1 million for the year ended December 31, 2025, as compared to $7.8 million for the year ended December 31, 2024, a decrease of approximately $2.7 million. The decrease was primarily due to $2.9 million of decreased employment and other operating costs, partially offset by $0.2 million of increased costs related to the Merger.

***Loss on MannKind Transaction*** — Loss on MannKind Transaction was $2.6 million on certain assets disposed of during the year ended December 31, 2024, in connection with the assignment of our long-term lease of our Bedford facility pursuant to those certain agreement by and between us and MannKind Corporation and Cobalt Propco 2020, LLC (the "MannKind Transaction"). No such loss occurred for the year ended December 31, 2025.

**Liquidity and Capital Resources**

Through December 31, 2025, we incurred an accumulated deficit of $302.3 million, primarily as a result of expenses incurred through a combination of research and development activities related to our various product candidates and general and administrative expenses supporting those activities. We have financed our operations since inception primarily through the sale of preferred and common stock, the issuance of convertible promissory notes, term loans, and collaboration and license agreements. Our total cash and cash equivalents balance as of December 31, 2025, was $4.1 million.

We anticipate that we will continue to incur significant expenses in connection with pursuing strategic alternatives, including as related to and in connection with the Merger. Contingent on securing additional funding and continuing development of our program candidates, we anticipate that we would continue to incur losses over the next several years due to development costs associated with our iSPERSE<sup>™</sup> pipeline programs. We expect that we will need additional capital to fund our operations as we continue to incur research and development and general and administrative expenses. We may raise such capital through a combination of equity offerings, debt financings, other third-party funding and other collaborations and strategic alliances.

We expect that our existing cash and cash equivalents as of December 31, 2025, will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months following the date of this Annual Report on Form 10-K. We have based our projections of operating capital requirements on assumptions that may prove to be incorrect, and we may use all of our available capital resources sooner than we expect. Because of the numerous risks and uncertainties associated with research, development, achievement of contingent milestones and commercialization of pharmaceutical products, we are unable to estimate the exact amount of our operating capital requirements.

We have no material off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

The following table sets forth the major sources and uses of cash for each of the periods set forth below (in thousands):

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| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2025** | **2024** |
| Net cash used in operating activities | $(5433) | (10716) |
| Net cash used in investing activities | - | (398) |
| Net decrease in cash, cash equivalents, and restricted cash | $(5433) | (11114) |

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***Net cash used in operating activities***

Net cash used in operating activities for the year ended December 31, 2025 was $5.4 million, which was primarily the result of a net loss of $5.2 million, and $0.2 million in cash outflows associated with changes in operating assets and liabilities and less than $0.1 million of net non-cash adjustments.

Net cash used in operating activities for the year ended December 31, 2024 was $10.7 million, which was primarily the result of a net loss of $9.6 million and $4.8 million in cash outflows associated with changes in operating assets and liabilities, partially offset by $3.6 million of net non-cash adjustments.

 ****

***Net cash used in investing activities***

No net cash was used in investing activities for the year ended December 31, 2025.

Net cash used in investing activities for the year ended December 31, 2024 was due to purchases of property and equipment.

***Financings***

In May 2021, the Company entered into an At-The-Market Sales Agreement (the "Sales Agreement") with H.C. Wainwright and Co., LLC ("HCW") to act as the Company's sales agent with respect to the issuance and sale of up to $20.0 million of the Company's shares of common stock, from time to time in an at-the-market public offering (the "ATM Offering"). Upon filing of the Annual Report, the Company continued to be subject to General Instruction I.B.6 of Form S-3, pursuant to which in no event will the Company sell its common stock in a registered primary offering using Form S-3 with a value exceeding more than one-third of its public float in any 12 calendar month period so long as its public float remains below $75,000,000. Therefore, the amount that may be able to be raised using the ATM Offering will be significantly less than $20,000,000, until such time as the Company's public float held by non-affiliates exceeds $75,000,000.

Sales of common stock under the Sales Agreement are made pursuant to an effective shelf registration statement on Form S-3, which was filed with the SEC on May 17, 2024, and subsequently declared effective on May 30, 2024 (File No. 333-279491), and a related prospectus. HCW acts as the Company's sales agent on a commercially reasonable efforts basis, consistent with its normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of The Nasdaq Capital Market ("Nasdaq"). If expressly authorized by the Company, HCW may also sell the Company's common stock in privately negotiated transactions. There is no specific date on which the ATM Offering will end, there are no minimum sale requirements and there are no arrangements to place any of the proceeds of the ATM Offering in an escrow, trust or similar account. HCW is entitled to compensation at a fixed commission rate of 3.0% of the gross proceeds from the sale of the Company's common stock pursuant to the Sales Agreement.

During the years ended December 31, 2025 and 2024, no shares of the Company's common stock were sold under the Sales Agreement.

**Known Trends, Events and Uncertainties**

The Company is subject to risks and uncertainties including, should it resume development of its product candidates, risks and uncertainties common to companies in the biopharmaceutical industry, including but not limited to, risks associated with completing preclinical studies and clinical trials, receiving regulatory approvals for product candidates, development by competitors of new biopharmaceutical products, dependence on key personnel, protection of proprietary technology, compliance with government regulations and the ability to secure additional capital to fund operations. Should the Company resume development of its product candidates, significant additional research and development efforts, including preclinical and clinical testing and regulatory approval, prior to commercialization, would be required. These efforts would require significant amounts of additional capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Even if the Company's product development efforts are successful, should the Company resume development of its product candidates, it is uncertain when, if ever, the Company would realize revenue from product sales. Additionally, recent changes to U.S. policy implemented by the U.S. Congress, the Trump administration or any new administration have impacted and may in the future impact, among other things, the U.S. and global economy, tariffs, international trade relations, unemployment, immigration, healthcare, taxation, the U.S. regulatory environment, inflation and other areas. Although we cannot predict the impact, if any, of these changes to our business, they could adversely affect our business.

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|:---|:---|
| **ITEM 7A.** | **QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.** |

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Not applicable.

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|:---|:---|
| **ITEM 8.** | **FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.** |

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The information required by this Item 8 is included at the end of this Annual Report on Form 10-K beginning on page F-1.

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|:---|:---|
| **ITEM 9.** | **CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.** |

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As previously reported on our Current Report on Form 8-K, filed with the SEC on April 8, 2025, on April 4, 2025, the Audit Committee engaged CBIZ CPAs P.C. ("CBIZ") as our independent registered public accounting firm for the fiscal year ended December 31, 2025, and accepted the resignation of Marcum LLP ("Marcum").

On November 1, 2024, CBIZ acquired the attest business of Marcum. Substantially all of the partners and staff that provided attestation services with Marcum joined CBIZ CPAs P.C. On April 4, 2025, Marcum resigned as auditors of the Company and with the approval of the Audit Committee of the Company's Board of Directors, CBIZ was engaged as our independent registered public accounting firm.

During the fiscal years ended December 31, 2024, and December 31, 2023, and the subsequent interim period through April 4, 2025, neither we nor anyone on our behalf consulted with CBIZ regarding (i) the application of accounting principles to any specified transaction, either completed or proposed or the type of audit opinion that might be rendered on our consolidated financial statements, and neither a written report nor oral advice was provided to us that CBIZ concluded was an important factor considered by us in reaching a decision as to any accounting, auditing, or financial reporting issue, or (ii) any matter that was either the subject of a "disagreement," as defined in Item 304(a)(1)(iv) of Regulation S-K, or a "reportable event," as defined in Item 304(a)(1)(v) of Regulation S-K.

The reports of Marcum on our consolidated financial statements for the years ended December 31, 2024, and December 31, 2023, did not contain an adverse opinion or a disclaimer of opinion, and was not qualified or modified as to uncertainty, audit scope, or accounting principles.

During the two most recent fiscal years ended December 31, 2024, and December 31, 2023, and the subsequent interim period through April 4, 2025, there were no disagreements (as defined in Item 304(a)(1)(iv) of Regulation S-K of the Securities Exchange Act of 1934, as amended ("Regulation S-K") and the related instructions to Item 304 of Regulation S-K) with Marcum on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Marcum, would have caused Marcum to make reference to the subject matter of the disagreements in connection with its reports on our consolidated financial statements for such years. Also during this time, there were no "reportable events," as defined in Item 304(a)(1)(v) of Regulation S-K.

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| | |
|:---|:---|
| **ITEM 9A.** | **CONTROLS AND PROCEDURES.** |

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**Disclosure Controls and Procedures**

Our Principal Executive Officer and Principal Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Annual Report on Form 10-K, have concluded that, based on such evaluation, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms, and is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer as appropriate to allow timely decisions regarding required disclosure.

**Internal Control over Financial Reporting**

*Management's Annual Report on Internal Control over Financial Reporting*

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Internal control over financial reporting is a process designed by, or under the supervision of, our Principal Executive Officer and Principal Financial Officer, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with GAAP, including those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and the disposition of our assets, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with GAAP and that receipts and expenditures are being made only in accordance with authorizations of our management and board of directors, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the consolidated financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may deteriorate.

Management evaluates the effectiveness of our internal control over financial reporting based on the 2013 framework in *Internal Control — Integrated Framework* issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2025.

*Changes in Internal Controls over Financial Reporting*

There were no changes in our internal control over financial reporting that occurred during our last fiscal quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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| | |
|:---|:---|
| **ITEM 9B.** | **OTHER INFORMATION.** |

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None.

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| | |
|:---|:---|
| **ITEM 9C.** | **DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.** |

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Not applicable.

**PART III**

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|:---|:---|
| **ITEM 10.** | **DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE** |

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**Management and the Board of Directors**

The following table sets forth the persons who serve as our executive officers and directors, and their ages as of December 31, 2025.

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position** |
| Peter Ludlum | 70 | Interim Chief Executive Officer and Interim Chief Financial Officer |
| Richard Batycky, Ph.D. | 57 | Director |
| Todd Bazemore | 55 | Director |
| Christopher Cabell M.D. | 57 | Director |
| Michael J. Higgins | 63 | Director |
| Anand Varadan | 59 | Director |

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**Management**

**Peter Ludlum.** Mr. Ludlum has served as our Interim Chief Executive Officer and principal executive officer since July 20, 2024, Pulmatrix's Interim Chief Financial Officer, principal accounting officer and principal financial officer since April 2022, and Pulmatrix's Strategic Advisor – Finance since December 2021, all pursuant to a November 30, 2021, consulting agreement and subsequent amendments thereto, by and between Pulmatrix and Danforth Advisors, LLC ("Danforth"). Mr. Ludlum has served as an employee with Danforth, a provider of strategic and operational finance and accounting for life science companies, since December 2021. Prior to Danforth, Mr. Ludlum worked as an independent financial consultant. Previously, Mr. Ludlum served in several executive roles at Emmaus Life Sciences, Inc. (n/k/a EMI Holding, Inc.), a commercial-stage biopharmaceutical company, including Co-President, Chief Business Officer, Executive Vice President and Chief Financial Officer, during his tenure from April 2012 until May 2017. Mr. Ludlum previously served as the Chief Financial Officer of Energy and Power Solutions, Inc., an energy intelligence company, from April 2008 to December 2011. He received a B.S. in Business and Economics with a major in accounting from Lehigh University and an MBA with a concentration in Finance from California State University, Fullerton.

**Board of Directors (Non-Employee Directors)**

**Richard Batycky, Ph.D**. Dr. Batycky was appointed to serve as our director in November 2019. He is currently the President and Chief Executive Officer of Nocion Therapeutics, Inc., having served in such position since 2018. Dr. Batycky has over two decades of experience with biotech start-ups from founding to acquisition across an array of platforms and disease states with notable expertise in inhaled drug development. From 2009 to 2014, he was the Chief Scientific Officer and a founder of Civitas Therapeutics, which was acquired by Acorda Therapeutics, Inc., or Acorda. At Acorda, he served as Chief Technology Officer from 2014 to 2018 where he led its novel dry powder inhalation therapy to treat motor issues in Parkinson's patients through to FDA approval as Inbrija<sup>™</sup>. Prior to Civitas Therapeutics, he was Chief Scientific Officer and Senior VP of R&D at Pulmatrix from 2007 to 2009 and held prior positions at Alkermes and Advanced Inhalation Research from 1998 to 2007. Dr. Batycky received his B.Sc. in Chemical Engineering from the University of Calgary and his S.M. and Ph.D. in Chemical Engineering from the Massachusetts Institute of Technology (MIT). Pulmatrix believes that Dr. Batycky's noteworthy experience in inhaled drug development in biotechnology companies qualifies him to serve as a member of our Board.

**Todd Bazemore.** Mr. Bazemore was appointed to serve as our director in October 2020. Todd Bazemore is the former CEO and Director at KALA BIO, which he joined in November 2017. Previously, Mr. Bazemore served as Executive Vice President and Chief Operating Officer of Santhera Pharmaceuticals (USA) Inc., or Santhera, a pharmaceutical company and subsidiary of Santhera Pharmaceuticals Holdings AG, from September 2016 until November 2017. Prior to joining Santhera, Mr. Bazemore served as Executive Vice President and Chief Commercial Officer of Dyax Corp., or Dyax, a biopharmaceutical company focused on orphan diseases, between April 2014 and January 2016, when Dyax was acquired by Shire plc. Between April 2012 and September 2013, he served as Vice President, Managed Markets at Sunovion Pharmaceuticals, Inc., or Sunovion (a subsidiary of Dainippon Sumitomo Pharma Co. Ltd.), a global biopharmaceutical company focused on serious medical conditions. Prior to that, Mr. Bazemore held several roles of increasing responsibility at Sunovion, including Vice President of Sales and Vice President of the Respiratory Business Unit. He received his Bachelor of Science from the University of Massachusetts, Lowell. Pulmatrix believes that Mr. Bazemore has extensive business experience running the commercial operations of biopharmaceutical companies and qualifies him to serve as a member of our Board.

**Christopher Cabell, M.D.** Dr. Cabell was appointed to serve as our director in June 2020. He is currently the President, Head of Research & Development and Chief Medical Officer at Inhibikase Therapeutics. Prior to joining Inhibikase Therapeutics in February 2025, Dr. Cabell was Chief Executive Officer at CorHepta Pharmaceuticals, which was acquired by Inhibikase. Previously, Dr. Cabell was Chief Medical Officer at Arena Pharmaceuticals, Zura Bio and Emergent BioSolutions. Dr. Cabell has also served on multiple corporate and scientific advisory boards. Earlier in his career, Dr. Cabell was a consultant, founding HD Consulting and serving as Head of the Therapeutic & Specialty Business Development team for Quintiles. Dr. Cabell was on faculty at Duke University School of Medicine in the Division of Cardiology. Dr. Cabell is a Fellow of the American College of Cardiology and has over 100 peer reviewed publications including in the New England Journal of Medicine, JAMA, and Annals of Internal Medicine. Board certified in both internal medicine and cardiovascular diseases, Dr. Cabell is an honors graduate of Pennsylvania State University and Duke University, earning both his Medical Degree and a Masters in Health Sciences from the latter. Pulmatrix believes that Dr. Cabell's noteworthy experience in clinical drug development in biotechnology companies qualifies him to serve as a member of our Board.

**Michael J. Higgins.** Mr. Higgins was appointed Chairman of our Board in April 2020. He has been a member of the Pulmatrix Board since June 2015. He has served as chairman of the board of directors of Voyager Therapeutics, a publicly traded biopharmaceutical company, since June 2019, and served as Voyager's Interim CEO from June 2021 through March 2022. He has served as a board member of Genocea Biosciences Inc., a publicly traded immuno-oncology company, from 2015 to June 2022; Nocion Therapeutics, Inc., a biopharmaceutical company, since September 2020; Camp4 Therapeutics Corporation, a biopharmaceutical company, since October 2017 and Cyclerion Therapeutics, Inc., a publicly traded biopharmaceutical company, since November 2023. Mr. Higgins is a serial entrepreneur who has helped launch/build numerous companies during his career. He served as Entrepreneur-in-Residence at Polaris Partners, an investment company, from 2015 to 2020. From 2003 to 2014 he served as Senior Vice President, Chief Operating Officer at Ironwood Pharmaceuticals Inc, a biopharmaceutical company. Prior to 2003, Mr. Higgins held a variety of senior business positions at Genzyme Corporation, including Vice President of Corporate Finance and Vice President of Business Development. Prior to joining Genzyme Corporation, Mr. Higgins led Procept, Inc.'s financial team from founding through its initial public offering. Mr. Higgins earned a B.S. from Cornell University and an M.B.A. from the Amos Tuck School of Business Administration at Dartmouth College. Pulmatrix believes that Mr. Higgins' financial and business expertise, including his diversified background as an executive officer in public pharmaceutical companies, qualifies him to serve as a member of our Board.

**Anand Varadan.** Mr. Varadan was appointed to serve as our director in July 2021. He is currently the founder and President of Ignition Insights, LLC, a consulting firm providing commercial and strategic consultancy services to biopharma companies and investors. Previously, he was Executive Vice President, Chief Commercial Officer at Chiasma Inc., a commercial-stage biopharmaceutical company, until its acquisition by Amryt PLC. Mr. Varadan also served as Executive Vice President, Chief Commercial Officer of Karyopharm Therapeutics, Inc, an oncology-focused pharmaceutical company, where he started up commercial operations leading to the successful launch of XPOVIO for multiple myeloma. Earlier in his career, Mr. Varadan held executive leadership roles at Amgen Inc., a biopharmaceutical company, in the U.S., E.U., and Canada including Vice President, U.S. Inflammation and Nephrology Business Unit and Vice President and General Manager, Amgen Canada. Prior to Amgen, Mr. Varadan was a brand manager at Procter and Gamble Company. Mr. Varadan has a B.A. from George Washington University and an M.B.A. from the Simon Business School at the University of Rochester. Mr. Varadan's extensive executive leadership experience and his in-depth knowledge of the biopharmaceutical industry make him well qualified to serve on our Board.

**Corporate Governance**

We, with the oversight of the Board and its committees, operates within a comprehensive plan of corporate governance for the purpose of defining independence, assigning responsibilities, setting high standards of professional and personal conduct and assuring compliance with such responsibilities and standards. We regularly monitor developments in the area of corporate governance.

**Code of Corporate Conduct and Ethics and Whistleblower Policy**

We have adopted a Code of Corporate Conduct and Ethics and Whistleblower Policy that applies to all of our associates, as well as each of our directors and certain persons performing services for us. The Code of Corporate Conduct and Ethics and Whistleblower Policy addresses, among other things, competition and fair dealing, conflicts of interest, protection and proper use of Company assets, government relations, compliance with laws, rules and regulations and the process for reporting violations of the Code of Corporate Conduct and Ethics and Whistleblower Policy, employee misconduct, improper conflicts of interest or other violations. Our Code of Corporate Conduct and Ethics and Whistleblower Policy is available on our website at www.pulmatrix.com in the "Corporate Governance" section found under the "Investors" tab. We intend to disclose any amendments to, or waivers from, our Code of Corporate Conduct and Ethics and Whistleblower Policy at the same website address provided above.

**Board Composition**

Our Amended and Restated Certificate of Incorporation and our Restated Bylaws provide that our Board will consist of such number of directors as determined from time to time by resolution adopted by the Board. Effective April 6, 2021, the size of the Board was fixed at six directors, which decreased to five directors following the departure of Ted Raad on July 19, 2024. Subject to any rights applicable to any then outstanding shares of preferred stock, any vacancies or newly created directorships resulting from an increase in the authorized number of directors may be filled by a majority of the directors then in office. The Board is classified into three classes, with the term of office of one class expiring each year. The term of office of the Class I directors expires at our annual meeting of stockholders to be held in 2027, the term of office of the Class II directors expires at our annual meeting of stockholders to be held in 2025 and the term of office of the Class III directors expires at our annual meeting of stockholders to be held in 2026. Stockholders vote to elect directors of the class with a term then expiring each year at our annual meeting.

We have no formal policy regarding board diversity. Our Board believes that each director should have a basic understanding of our principal operational and financial objectives and plans and strategies, our results of operations and financial condition and relative standing in relation to its competitors. We take into consideration the overall composition and diversity of our Board and areas of expertise that director nominees may be able to offer, including business experience, knowledge, abilities and customer relationships. Generally, we will strive to assemble a board that brings to it a variety of perspectives and skills derived from business and professional experience as Pulmatrix may deem are in its and its stockholders' best interests. In doing so, we will also consider candidates with appropriate non-business backgrounds.

**Director Independence**

We are currently listed on Nasdaq and therefore rely on the definition of independence set forth in the Nasdaq Listing Rules ("Nasdaq Rules"). Under the Nasdaq Rules, a director will only qualify as an "independent director" if, in the opinion of our Board, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Based upon information requested from and provided by each director concerning his background, employment, and affiliations, including family relationships, we have determined that Mr. Bazemore, Dr. Batycky, Dr. Cabell, Mr. Higgins, and Mr. Varadan have no material relationships with us that would interfere with the exercise of independent judgment and are "independent directors" as that term is defined in the Nasdaq Rules.

**Board Committees, Meetings and Attendance**

During 2025, the Board held eight meetings. We expect our directors to attend Board meetings, meetings of any committees and subcommittees on which they serve, and each annual meeting of stockholders, either in person or by teleconference. During 2025, each director attended at least seventy-five percent (75%) of the total number of meetings held by the Board and Board committees of which such director was a member. All of our directors attended our 2025 special meeting, which was held in lieu of the annual meeting of stockholders.

The Board delegates various responsibilities and authority to different Board committees. Committees regularly report on their activities and actions to the full Board. Currently, the Board has established an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee. Committee assignments are re-evaluated annually. Each of these committees operates under a charter that has been approved by our Board. The current charter of each of these committees is available on our website at *www.pulmatrix.com* in the "Corporate Governance" section under "Investors." As of the date of this Annual Report on Form 10-K, the following table sets forth the membership of each of the Board committees listed above.

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| | | | |
|:---|:---|:---|:---|
| **Name** | **Audit Committee** | **Compensation Committee** | **Nominating and**<br> **Corporate Governance**<br> **Committee** |
| Richard Batycky, Ph.D. | Member | Chairman |  |
| Todd Bazemore | Member |  | Chairman |
| Christopher Cabell, M.D. |  | Member | Member |
| Michael J. Higgins\* | Chairman |  | Member |
| Anand Varadan |  | Member |  |

---

\* Chairman of the Board of Directors

***Audit Committee***

Our Audit Committee is responsible for, among other matters:

● approving and retaining the independent auditors to conduct the annual audit of our financial statements;

● reviewing the proposed scope and results of the audit;

● reviewing and pre-approving audit and non-audit fees and services;

● reviewing accounting and financial controls with the independent auditors and our financial and accounting staff;

● reviewing and approving transactions between us and our directors, officers and affiliates;

● recognizing and preventing prohibited non-audit services;

● establishing procedures for complaints received by us regarding accounting matters;

● overseeing internal audit functions, if any; and

● preparing the report of the audit committee that the rules of the SEC require to be included in our annual meeting proxy statement.

Our Audit Committee is composed of Michael J. Higgins (chairman), Richard Batycky, Ph.D. and Todd Bazemore. Our Board has determined that Mr. Higgins, Dr. Batycky and Mr. Bazemore were independent in accordance with Nasdaq Rules and Rule 10A-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Our Board has also reviewed the education, experience and other qualifications of each member of the Audit Committee. Based upon that review, our Board has determined that Michael J. Higgins qualifies as an "audit committee financial expert," as defined by the rules of the SEC. The Audit Committee met four times during 2025.

 ****

***Compensation Committee***

Our Compensation Committee is responsible for, among other matters:

● reviewing and recommending the compensation arrangements for management, including the compensation for our president and chief executive officer;

● appointing, compensating and overseeing the work of any compensation consultant, legal counsel or other advisor retained by the Compensation Committee;

● establishing and reviewing general compensation policies with the objective to attract and retain superior talent, to reward individual performance and to achieve our financial goals;

● administering our stock incentive plans; and

● preparing the report of the compensation committee to the extent that the rules of the SEC require such report to be included in our annual meeting proxy statement.

Our Compensation Committee is composed of Richard Batycky, Ph.D. (chairman), Christopher Cabell, M.D. and Anand Varadan. Our Board has determined that Dr. Batycky, Dr. Cabell and Mr. Varadan were independent in accordance with Nasdaq Rules. The Compensation Committee has the authority to delegate to subcommittees of the Compensation Committee any of the responsibilities of the full committee. The Compensation Committee did not meet during 2025 and did not engage a compensation consultant.

***Nominating and Corporate Governance Committee***

Our Nominating and Corporate Governance Committee is responsible for, among other matters:

● evaluating the current composition, organization and governance of the Board and its committees, and making recommendations for changes thereto;

● reviewing each director and nominee annually;

● determining desired Board member skills and attributes and conducting searches for prospective members accordingly;

● evaluating nominees, and making recommendations to the Board concerning the appointment of directors to Board committees, the selection of Board committee chairs, proposal of the slate of directors for election to the Board, and the termination of membership of individual directors in accordance with the Board's governance principles;

● overseeing the process of succession planning for the chief executive officer and, as warranted, other senior officers of the Company;

● developing, adopting and overseeing the implementation of a code of business conduct and ethics; and

● administering the annual Board performance evaluation process.

Our Nominating and Corporate Governance Committee is composed of Todd Bazemore (chairman), Christopher Cabell, M.D. and Michael J. Higgins. The Nominating and Corporate Governance Committee did not meet during 2025.

**Director Nominations**

Our Nominating and Corporate Governance Committee considers all qualified candidates identified by members of the Board, by senior management and by stockholders. The Nominating and Corporate Governance Committee follows the same process and uses the same criteria for evaluating candidates proposed by stockholders, members of the Board and members of senior management. We did not pay fees to any third party to assist in the process of identifying or evaluating director candidates during 2025.

In evaluating director nominees, the Nominating and Corporate Governance Committee considers the following factors:

● the appropriate size and diversity of our Board;

● our needs with respect to the particular knowledge, skills and experience of nominees, including experience in corporate finance, technology, business, administration and sales, in light of the prevailing business conditions and the knowledge, skills and experience already possessed by other members of the Board;

● experience with accounting rules and practices, and whether such a person qualifies as an "audit committee financial expert" pursuant to SEC rules; and

● balancing continuity of our Board with periodic injection of fresh perspectives provided by new Board members.

Our Board believes that each director should have a basic understanding of our principal operational and financial objectives and plans and strategies, our results of operations and financial condition and our relative standing in relation to our competitors.

In identifying director nominees, the Board will first evaluate the current members of the Board willing to continue in service. Current members of the Board with skills and experience that are relevant to our business and who are willing to continue in service will be considered for re-nomination.

If any member of the Board does not wish to continue in service or if the Board decides not to re-nominate a member for re-election, the Board will identify another nominee with the desired skills and experience described above. The Board takes into consideration the overall composition and diversity of the Board and areas of expertise that director nominees may be able to offer, including business experience, knowledge, abilities and customer relationships. Generally, the Board will strive to assemble a Board that brings to us a variety of perspectives and skills derived from business and professional experience as it may deem are in our and our stockholders' best interests. In doing so, the Board will also consider candidates with appropriate non-business backgrounds.

**Board Leadership Structure and Role in Risk Oversight**

**Communications with Directors**

The Board welcomes communication from our stockholders. Stockholders and other interested parties who wish to communicate with a member or members of our Board or a committee thereof may do so by addressing correspondence to the Board member, members or committee, c/o Secretary, Pulmatrix, Inc., 945 Concord Street, Suite 1217, Framingham, Massachusetts 01701. Our Secretary will review and forward correspondence to the appropriate person or persons.

All communications received as set forth in the preceding paragraph will be opened by our Secretary for the sole purpose of determining whether the contents represent a message to our directors. Any contents that are not in the nature of advertising, promotions of a product or service or patently offensive material will be forwarded promptly to the addressee(s). In the case of communications to the Board or any group or committee of directors, our Secretary will make sufficient copies of the contents to send to each director who is a member of the group or committee to whom the communication is addressed. If the amount of correspondence received through the foregoing process becomes excessive, our Board may consider approving a process for review, organization and screening of the correspondence by our Secretary or another appropriate person.

**Family Relationships**

There are no family relationships amongst our directors and executive officers, or person nominated or chosen by the Company to become a director or executive officer.

**Involvement in Certain Legal Proceedings**

There have been no material legal proceedings that would require disclosure under the federal securities laws that are material to an evaluation of the ability or integrity of our directors or executive officers, or in which any director, officer, nominee or principal stockholder, or any affiliate thereof, is a party adverse to us or has a material interest adverse to us.

**Insider Trading Policy and Anti-Hedging Policy**

We maintain an insider trading policy that applies to our officers and directors that prohibits trading our securities during certain established periods and when in possession of material non-public information. It also prohibits, unless approved in advance in limited circumstances by the policy administrator, the hedging of our securities, including short sales or purchases or sales of derivative securities based on our securities, and the use of our securities to secure a margin or other loan. Since the adoption of our insider trading policy, the policy administrator has not granted any such exemptions to the policy's general prohibition on hedging or pledging. While the Company is not subject to the insider trading policy, the company does not trade in its securities when it is in possession of material nonpublic information other than pursuant to previously adopted Rule 10b5-1 trading plans.

**Section 16(a) Beneficial Ownership Reporting Compliance**

Each of our executive officers and directors and persons who own more than 10% of our outstanding shares of common stock is required under Section 16(a) of the Exchange Act to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock and to furnish us with copies of those reports. To our knowledge, based solely on our review of copies of reports we have received and written representations from certain reporting persons, we do not believe that there were any delinquent filers. We believe our directors and executive officers and greater than 10% shareholders for the year ended December 31, 2025, complied with all applicable Section 16(a) filing requirements.

**Timing and Issuance of Stock Options**

The Board does not have a formal policy on the timing of stock option awards in relation to the disclosure of material non-public information; however, it would take into account material non-public information when determining the timing and terms of such an award to avoid an inappropriate impact on the value of the award. The Company has not timed the disclosure of material non-public information for the purpose of affecting the value of executive compensation.

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| | |
|:---|:---|
| **ITEM 11.** | **EXECUTIVE COMPENSATION** |

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**Executive Summary**

This section discusses the material components of our executive compensation program. We comply with the executive compensation disclosure rules applicable to "smaller reporting companies," as such term is defined in the rules promulgated under the Securities Act, which require compensation disclosure for (i) our principal executive officer; (ii) the two most highly compensated executive officers other than our principal executive officer; and (iii) up to two additional individuals for whom disclosure would have been provided pursuant to clause (ii) but for the fact that the individual was not serving as an executive officer at the end of 2025. These current officers are referred to as our Named Executive Officers.

**Summary Compensation Table**

The following table sets forth information concerning the compensation of our Named Executive Officers for the years ended December 31, 2025 and 2024.

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Name and Principal Position** | **Year** | **Bonus<br> ($)** | **All Other Compensation<br> ($)** | **Total <br> ($)** |
| Peter Ludlum<sup>(1)</sup> | 2025 |  | 715225<sup>(2)</sup> | 715225 |
| (Interim Chief Executive and Interim Chief Financial Officer) | 2024 | 50000<sup>(3)</sup> | 730877<sup>(2)</sup> | 780877 |

---

<sup>(1)</sup> Peter Ludlum was appointed as our Interim Chief Financial Officer in April 2022. Effective as of July 20, 2024, Mr. Ludlum also was appointed as our Interim Chief Executive Officer.

<sup>(2)</sup> The amount shown in the "All Other Compensation" column for Mr. Ludlum includes fees paid to Danforth on his behalf during the years ended December 31, 2025, and 2024.

<sup>(3)</sup> Represents amounts earned by Mr. Ludlum pursuant to the Ludlum Retention Agreement (as defined below).

**Narrative Disclosure to Summary Compensation Table**

***Mr. Ludlum, Interim Chief Executive Officer and Interim Chief Financial Officer***

Mr. Ludlum has served as our Interim Chief Executive Officer and principal executive officer since July 20, 2024, our Interim Chief Financial Officer, principal accounting officer and principal financial officer since April 2022, and our Strategic Advisor – Finance since December 2021, all pursuant to a November 30, 2021, consulting agreement and subsequent amendments thereto, by and between us and Danforth (the "Ludlum Consulting Agreement").

*Ludlum Consulting Agreement*

Pursuant to the Ludlum Consulting Agreement, Danforth received cash compensation at a rate of $400 per hour for Mr. Ludlum's services as our Interim Chief Financial Officer. Effective following Mr. Ludlum's appointment as our Interim Chief Executive Officer, the rate payable to Danforth increased to $700 per hour to cover Mr. Ludlum's roles as interim CEO and interim CFO collectively. Each month, we and Danforth shall evaluate jointly the current fee structure and scope of Services (as defined in the Ludlum Consulting Agreement). Danforth reserves the right to an annual increase in consultant rates of up to 4%, effective January 1 of each year. Upon termination of the Ludlum Consulting Agreement, no compensation or benefits of any kind shall be payable or issuable to Danforth after the effective date of such termination. In addition, we will reimburse Danforth for reasonable out-of-pocket business expenses, including but not limited to travel and parking, incurred by Danforth in performing the services, upon submission by Danforth of supporting documentation reasonably acceptable to us. Any such accrued expenses in any given three (3) month period that exceed $1,000 shall be submitted to us for our prior written approval.

Pursuant to the Ludlum Consulting Agreement, Mr. Ludlum will provide services to us under the Ludlum Consulting Agreement as an independent contractor and employee of Danforth. The term of the Ludlum Consulting Agreement will continue until such time as either party has given notice of termination. The Ludlum Consulting Agreement may be terminated by either party hereto: (a) with cause (as defined in the Ludlum Consulting Agreement) upon written notice to the other party; or (b) without cause upon 30 days prior written notice to the other party.

*Ludlum Retention Agreement*

In addition to the Ludlum Consulting Agreement, pursuant to the terms of a retention letter agreement, dated as of July 15, 2024, and effective as of July 20, 2024 (the "Ludlum Retention Agreement"), we also agreed to pay to Mr. Ludlum two bonuses to reflect his increased role with us. We paid Mr. Ludlum a lump sum $30,000 bonus in July 2024 and an additional $20,000 following the completion of our 2024 annual meeting of stockholders (the "2024 Annual Meeting") held on December 18, 2024. Pursuant to this agreement, Mr. Ludlum must be providing services to us on the date of the 2024 Annual Meeting (such date, the "Ludlum Retention Date" and each bonus, a "Ludlum Retention Bonus"), which Mr. Ludlum was as of the date of the 2024 Annual Meeting.

Notwithstanding the foregoing, if Mr. Ludlum's services relationship with us is terminated prior to the Ludlum Retention Date by us without Cause (as defined in the Ludlum Retention Agreement) or due to Mr. Ludlum's death or disability, then we shall pay any Ludlum Retention Bonus not previously paid to him (or to his estate) on our next regularly scheduled payroll date following the date he (or his estate or legal representative) returns a validly executed, irrevocable release of claims in the form provided by us at the time of his termination (the "Ludlum Release") and such Ludlum Release becomes effective; provided, however, that in the event the time period for signing the Ludlum Release, plus the expiration of any applicable revocation period, begins in one taxable year and ends in a second taxable year, payment of the applicable retention bonus will not be made until the second taxable year.

**Outstanding Equity Awards at Fiscal Year-End**

Mr. Ludlum had no outstanding equity awards as of December 31, 2025.

**Compensation Recovery Policy**

In November 2023, our board of directors approved a Compensation Recovery Policy, which states that in the event we are required to prepare an accounting restatement, then we are directed, to the fullest extent permitted by governing law, to recover from each executive officer the amount, if any, of previously awarded compensation that has been determined to be erroneously awarded. This policy applies to incentive-based compensation received by executive officers on or after October 2, 2023.

**Director Compensation**

We have entered into a director's agreement with each of our non-employee directors. In 2025, under these agreements, non-employee directors were paid cash compensation payable in four quarterly payments as set forth in the table below.

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| | |
|:---|:---|
|  | **Annual Retainer<br> Non-Employee<br> Directors** |
| **Board of Directors:** |  |
| Members | $35000 |
| Chairperson | $65000 |
| **Audit Committee:** |  |
| Members | $7500 |
| Chairperson | $15000 |
| **Compensation Committee:** |  |
| Members | $5000 |
| Chairperson | $11500 |
| **Nominating and Corporate Governance Committee:** |  |
| Members | $5000 |
| Chairperson | $10000 |

---

The agreements also provide that such directors will be reimbursed for reasonable out-of-pocket expenses incurred in connection with the attendance of board and committee meetings.

**Director Compensation Table**

The following table presents the total compensation for each person who served as a member of our Board during 2025. Other than as set forth in the table and described more fully below, we did not pay any compensation, reimburse any expense of, make any equity awards or non-equity awards to, or pay any other compensation to any of the other members of our Board in such period.

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| | | | | |
|:---|:---|:---|:---|:---|
| **Name** | **Fees earned<br> or paid in cash<br> ($)** | **Option <br> awards <sup>(1)</sup> ($)** | **All other compensation <sup></sup> ($)** | **Total <br> ($)** |
| Richard Batycky, Ph.D. | 54000 |  |  | 54000 |
| Todd Bazemore | 52500 |  |  | 52500 |
| Christopher Cabell, M.D. | 45000 |  |  | 45000 |
| Michael J. Higgins | 85000 |  |  | 85000 |
| Anand Varadan | 40000 |  |  | 40000 |

---

<sup>(1)</sup> As of December 31, 2025, our non-employee directors held the following aggregate number of options to purchase shares of common stock: Dr. Batycky, 5,555 options; Mr. Bazemore, 5,055 options; Dr. Cabell, 5,055 options; Mr. Higgins, 8,963 options; and Mr. Varadan, 4,305 options. No options were granted during the fiscal year ended December 31, 2025.

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| | |
|:---|:---|
| **ITEM 12.** | **SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS** |

---

The following table sets forth information regarding the beneficial ownership of our common stock as of February 23, 2026 by (i) each person known to us to beneficially own five percent (5%) or more of our common stock, (ii) each director and Named Executive Officer and (iii) all of our directors and executive officers as a group. The persons named in the table have sole voting and investment power with respect to all shares of common stock owned by them and have an address of c/o Pulmatrix Inc., 945 Concord Street, Suite 1217, Framingham, MA 01701, unless otherwise noted. Percentage of ownership is based on 3,652,285 shares of common stock issued and outstanding as of February 23, 2026.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Name** | **Number of Shares Beneficially Owned** | **Percentage of Shares outstanding<sup>(1)</sup>** | **Beneficially Owned as a result of stock ownership** | **Beneficially Owned as a result of stock option ownership** | **Beneficially Owned as a result of warrant ownership** |
| ***<u>Named Executive Officers and Directors</u>*** |  |  |  |  |  |
| Richard Batycky, Ph.D. | 5261 | \* | 25 | 5236 |  |
| Todd Bazemore | 4736 | \* |  | 4736 |  |
| Christopher Cabell M.D. | 4736 | \* |  | 4736 |  |
| Michael J. Higgins | 8462 | \* |  | 8462 |  |
| Anand Varadan | 3986 | \* |  | 3986 |  |
| Peter Ludlum |  |  |  |  |  |
| **All directors and executive officers as a group of six persons** | 27181 | \* | 25 | 27156 |  |
| ***<u>5% Stockholders</u>*** |  |  |  |  |  |

---

<sup>\*</sup> Less than 1%.

<sup>(1)</sup> Beneficial ownership as reported in the above table has been determined in accordance with Rule 13d-3 promulgated under the Exchange Act and is not necessarily indicative of beneficial ownership for any other purpose. The number of shares of common stock shown as beneficially owned in column one includes shares of common stock issuable upon the exercise of stock options and warrants that are currently exercisable or will become exercisable within sixty (60) days of February 23, 2026.

**Equity Compensation Plan Information**

The following table provides information regarding the number of securities to be issued under the Incentive Plan, the weighted-average exercise price of options issued under the Incentive Plan and the number of securities remaining available for future issuance under the Incentive Plan, in each case as of December 31, 2025:

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| | | | |
|:---|:---|:---|:---|
| **Plan category** | **Number of securities to be issued upon exercise of outstanding options, warrants and rights** | **Weighted-average exercise price of outstanding options, warrants and rights** | **Number of securities remaining available for future issuance under equity compensation plans<sup>(2)</sup>** |
| Equity compensation plans approved by security holders<sup>(1)</sup> | 33858 | $17.67 |  |
| Equity compensation plans not approved by security holders |  |  |  |
| Total | 33858 | $17.67 |  |

---

<sup>(1)</sup> Represents shares available for issuance under the Incentive Plan.

<sup>(2)</sup> The Company sponsored the Incentive Plan, which expired on June 10, 2025. No new awards may be made under the Incentive Plan after its expiration date. Awards issued under the Incentive Plan prior to its expiration remain outstanding in accordance with their terms.

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| | |
|:---|:---|
| **ITEM 13.** | **CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE** |

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Transactions with related persons are governed by our Code of Corporate Conduct and Ethics and Whistleblower Policy, which applies to all of our associates, as well as each of our directors and certain persons performing services for us. This code covers a wide range of potential activities, including, among others, conflicts of interest, self-dealing and related party transactions. Waiver of the policies set forth in this code will only be permitted when circumstances warrant. Such waivers for directors and executive officers, or that provide a benefit to a director or executive officer, may be made only by our Board, as a whole, or the Audit Committee and must be promptly disclosed as required by applicable law or regulation. Absent such a review and approval process in conformity with the applicable guidelines relating to the particular transaction under consideration, such arrangements are not permitted. All related party transactions for which disclosure is required to be provided herein were approved in accordance with our Code of Corporate Conduct and Ethics and Whistleblower Policy.

Since January 1, 2024, there were no transactions nor proposed transactions with related persons outside the normal course of business in which any related person has or will have a direct or indirect material interest involving an amount that exceeds the lesser of $120,000 or one percent (1%) of the average of the Company's total assets as of the end of last two completed fiscal years. A related person is any executive officer, director, nominee for director, or holder of 5% or more of the Company's common stock, or an immediate family member of any of those persons.

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| | |
|:---|:---|
| **ITEM 14.** | **PRINCIPAL ACCOUNTANT FEES AND SERVICES** |

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**Fees to Independent Registered Public Accounting Firm**

On November 1, 2024, CBIZ CPAs P.C. ("CBIZ") acquired the attest business of Marcum. Substantially all of the partners and staff that provided attestation services with Marcum joined CBIZ CPAs P.C.

On April 4, 2025, Marcum resigned as auditors of the Company and with the approval of the Audit Committee of the Company's Board of Directors, CBIZ was engaged as the Company's independent registered public accounting firm for the fiscal year ended December 31, 2025.

The following is a summary of the fees billed to us by CBIZ CPAs P.C. and Marcum LLP for professional services rendered in the years ended December 31, 2025 and 2024:

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| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Audit Fees | $317120 | $258530 |
| Audit-Related Fees |  |  |
| Tax Fees |  |  |
| All Other Fees |  |  |
| Total Fees | $317120 | $258530 |

---

*Audit Fees.* This category includes the audit of our annual consolidated financial statements, reviews of our interim financial statements included in our Form 10-Qs and services that are normally provided by our independent registered public accounting firm in connection with its engagements for those years. This category also includes advice on audit and accounting matters that arose during, or as a result of, the audit or the review of our unaudited interim financial statements.

*Audit-Related Fees.* This category consists of assurance and related services by our independent registered public accounting firm that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under "Audit Fees." The services for the fees disclosed under this category include consents regarding equity issuances.

*Tax Fees.* This category typically consists of professional services rendered by our independent registered public accounting firm for tax compliance and tax advice.

*All Other Fees.* This category includes aggregate fees billed in each of the last two fiscal years for products and services provided by CBIZ CPAs P.C. and Marcum LLP, other than the services reported in the categories above.

**Pre-Approval Policies and Procedures**

Under the Audit Committee's pre-approval policies and procedures, the Audit Committee is required to pre-approve the audit and non-audit services performed by our independent registered public accounting firm. On an annual basis, the Audit Committee pre-approves a list of services that may be provided by the independent registered public accounting firm without obtaining specific pre-approval from the Audit Committee. In addition, the Audit Committee sets pre-approved fee levels for each of the listed services. Any type of service that is not included on the list of pre-approved services must be specifically approved by the Audit Committee or its designee. Any proposed service that is included on the list of pre-approved services but will cause the pre-approved fee level to be exceeded will also require specific pre-approval by the Audit Committee or its designee.

The Audit Committee has delegated pre-approval authority to the Audit Committee chairman and any pre-approved actions by the Audit Committee chairman as designee are reported to the Audit Committee for approval at its next scheduled meeting.

All of the services rendered by CBIZ CPAs P.C. in 2025 were pre-approved by the Audit Committee.

**PART IV**

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| | |
|:---|:---|
| **ITEM 15.** | **EXHIBITS, FINANCIAL STATEMENT SCHEDULES.** |

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(a) The
 following documents are filed as part of this Annual Report on Form 10-K:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Consolidated
 Financial Statements:

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| | |
|:---|:---|
| [Report of Independent Registered Public Accounting Firm](#sk_002) – CBIZ CPAs P.C. (PCAOB ID: 199) | F-2 |
| [Report of Independent Registered Public Accounting Firm](#da_001) – Marcum LLP (PCAOB ID: 688) | F-3 |
| [Consolidated Balance Sheets as of December 31, 2025 and 2024](#sk_003) | F-4 |
| [Consolidated Statements of Operations for the Years Ended December 31, 2025 and 2024](#sk_004) | F-5 |
| [Consolidated Statements of Stockholders' Equity for the Years Ended December 31, 2025 and 2024](#sk_005) | F-6 |
| [Consolidated Statements of Cash Flows for the Years Ended December 31, 2025 and 2024](#sk_006) | F-7 |
| [Notes to Consolidated Financial Statements](#sk_007) | F-8 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Financial
 Statement Schedules:

None. Financial statement schedules have not been included because they are not applicable, or the information is included in the consolidated financial statements or notes thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Exhibits:

See "Index to Exhibits" for a description of our exhibits.

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| | |
|:---|:---|
| **ITEM 16.** | **FORM 10-K SUMMARY** |

---

Not applicable.

**INDEX TO EXHIBITS**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Exhibit**<br> **Number** | **Exhibit Description** | **Filed**<br> **with this**<br> **Report** | **Incorporated**<br> **by Reference**<br> **herein from Form**<br> **or Schedule** | **Filing Date** | **SEC**<br> **File/Reg.**<br> **Number** |
| 1.1 | [At the Market Offering Agreement, dated May 26, 2021, by and between Pulmatrix, Inc. and H.C. Wainwright & Co., LLC](https://www.sec.gov/Archives/edgar/data/1574235/000149315221012974/ex1-2.htm) |  | Form S-3<br> (Exhibit 1.2) | 05/26/21 | 333-256502 |
| 2.1 | [Agreement and Plan of Merger and Reorganization, dated as of November 13, 2024, by and among Pulmatrix, Inc., PCL Merger Sub, Inc., PCL Merger Sub II, LLC and Cullgen Inc.](https://www.sec.gov/Archives/edgar/data/1574235/000149315224044986/ex2-1.htm) |  | Form 8-K<br> (Exhibit 2.1) | 11/13/24 | 001-36199 |
| 2.2 | [Amendment No. 1 to the Agreement and Plan of Merger and Reorganization, dated as of April 7, 2025, by and among Pulmatrix, Inc., PCL Merger Sub, Inc., PCL Merger Sub II, LLC and Cullgen Inc.](https://www.sec.gov/Archives/edgar/data/1574235/000164117225003620/ex2-1.htm) |  | Form 8-K<br> (Exhibit 2.1) | 04/10/25 | 001-36199 |
| 3.1 | [Amended and Restated Certificate of Incorporation of Pulmatrix, Inc., as amended through June 15, 2015](https://www.sec.gov/Archives/edgar/data/1574235/000119312515290771/d40240dex31.htm) |  | Form 10-Q <br> (Exhibit 3.1) | 08/14/15 | 001-36199 |
| 3.2 | [Restated Bylaws of Pulmatrix, Inc., as amended through June 15, 2015](https://www.sec.gov/Archives/edgar/data/1574235/000119312515290771/d40240dex32.htm) |  | Form 10-Q <br> (Exhibit 3.2) | 08/14/15 | 001-36199 |
| 3.3 | [Certificate of Amendment to Amended and Restated Certificate of Incorporation of Pulmatrix, Inc., dated as of June 5, 2018](https://www.sec.gov/Archives/edgar/data/1574235/000119312518186316/d602014dex31.htm) |  | Form 8-K <br> (Exhibit 3.1) | 06/07/18 | 001-36199 |
| 3.4 | [Form of Certificate of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock.](https://www.sec.gov/Archives/edgar/data/1574235/000149315221031617/ex3-1.htm) |  | Form 8-K/A<br> (Exhibit 3.1) | 12/17/21 | 001-36199 |
| 3.5 | [Certificate of Correction to the Certificate of Designation, filed December 16, 2021](https://www.sec.gov/Archives/edgar/data/1574235/000149315221031788/ex3-2.htm) |  | Form 8-K/A<br> (Exhibit 3.2) | 12/17/21 | 001-36199 |
| 3.6 | [Certificate of Amendment to Amended and Restated Certificate of Incorporation of Pulmatrix, Inc., dated as of February 5, 2019](https://www.sec.gov/Archives/edgar/data/1574235/000119312519029535/d696559dex31.htm) |  | Form 8-K<br> (Exhibit 3.1) | 02/06/19 | 001-36199 |
| 3.7 | [Certificate of Amendment to Amended and Restated Certificate of Incorporation of Pulmatrix, Inc., dated as of February 28, 2022](https://www.sec.gov/Archives/edgar/data/1574235/000149315222007957/ex3-7.htm) |  | Form 10-K<br> (Exhibit 3.7) | 03/29/22 | 001-36199 |

---

3.8 [Amendment to the Restated Bylaws of Pulmatrix Inc., dated as of April 28, 2022](https://www.sec.gov/Archives/edgar/data/1574235/000149315222011543/ex3-1.htm) Form
 8-K (Exhibit
 3.1) 04/29/22 001-36199

3.9 [Amendment No. 2 to the Restated Bylaws of Pulmatrix, Inc., dated as of February 11, 2025](https://www.sec.gov/Archives/edgar/data/1574235/000149315225006588/ex3-1.htm) Form
 8-K (Exhibit
 3.1) 02/14/25 001-36199

4.1 [Form of Specimen Stock Certificate](https://www.sec.gov/Archives/edgar/data/1574235/000114420415037358/v413147_ex4-1.htm) Form
 8-K (Exhibit 4.1) 06/16/15 001-36199

4.2 [Form of Warrant Dated July 9, 2020](https://www.sec.gov/Archives/edgar/data/1574235/000149315220012889/ex4-1.htm) Form
 8-K (Exhibit 4.1) 07/09/20 001-36199

---

| | | | | |
|:---|:---|:---|:---|:---|
| 4.3 | [Form of Common Stock Purchase Warrant, dated December 17, 2021](https://www.sec.gov/Archives/edgar/data/1574235/000149315221031617/ex4-1.htm) | Form 8-K<br> (Exhibit 4.1) | 12/15/21 | 001-36199 |
| 4.4 | [Form of Placement Agent Warrant dated December 17, 2021](https://www.sec.gov/Archives/edgar/data/1574235/000149315221031617/ex4-2.htm) | Form 8-K<br> (Exhibit 4.2) | 12/15/21 | 001-36199 |
| 4.5 | [Description of Securities](https://www.sec.gov/Archives/edgar/data/1574235/000149315222007957/ex4-21.htm) | Form 10-K<br> (Exhibit 4.21) | 03/29/22 | 001-36199 |
| 4.6 | [Form of Placement Agent Warrant dated February 16, 2021](https://www.sec.gov/Archives/edgar/data/1574235/000149315221003992/ex4-1.htm) | Form 8-K<br> (Exhibit 4.1) | 02/16/21 | 001-36199 |
| 10.1\* | [Pulmatrix, Inc. Amended and Restated 2013 Employee, Director and Consultant Equity Incentive Plan](https://www.sec.gov/Archives/edgar/data/1574235/000114420415037358/v413147_ex10-6.htm) | Form 8-K<br> (Exhibit 10.6) | 06/16/15 | 001-36199 |
| 10.2\* | [Pulmatrix, Inc. 2013 Employee, Director and Consultant Equity Incentive Plan](https://www.sec.gov/Archives/edgar/data/1574235/000114420415043270/v415805_ex99-2.htm) | Form S-8 <br> (Exhibit 99.2) | 07/20/15 | 333-205752 |
| 10.3\* | [Pulmatrix Inc. 2003 Employee, Director and Consultant Stock Plan](https://www.sec.gov/Archives/edgar/data/1574235/000114420415043270/v415805_ex99-3.htm) | Form S-8<br> (Exhibit 99.3) | 07/20/15 | 333-205752 |
| 10.4 | [License, Development and Commercialization Agreement, dated June 9, 2017, by and between Pulmatrix, Inc. and Respivert Ltd.](https://www.sec.gov/Archives/edgar/data/1574235/000119312517248241/d419563dex101.htm) | Form 10-Q <br> (Exhibit 10.1) | 08/04/17 | 001-36199 |
| 10.5 | [First Amendment to the Pulmatrix, Inc. Amended and Restated 2013 Employee, Director and Consultant Equity Incentive Plan, dated as of June 5, 2018](https://www.sec.gov/Archives/edgar/data/1574235/000119312518186316/d602014dex101.htm) | Form 8-K<br> (Exhibit 10.1) | 06/07/18 | 001-36199 |
| 10.6\* | [Amended and Restated Employment Agreement, dated June 28, 2019, by and between the Company and Teofilo Raad](https://www.sec.gov/Archives/edgar/data/1574235/000119312519186184/d65604dex101.htm) | Form 10-K/A<br> (Exhibit 10.1) | 06/28/19 | 001-36199 |
| 10.7 | [Development and Commercialization Agreement, dated as of April 15, 2019, by and between Cipla Technologies, LLC and Pulmatrix, Inc.](https://www.sec.gov/Archives/edgar/data/1574235/000119312519212598/d773542dex104.htm) | Form 10-Q<br> (Exhibit 10.4) | 08/05/19 | 001-36199 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| 10.8\* | [Second Amendment to the Pulmatrix, Inc. Amended and Restated 2013 Employee, Director and Consultant Equity Incentive Plan, dated March 11, 2019](https://www.sec.gov/Archives/edgar/data/1574235/000119312519164828/d723890dex993.htm) | Form S-8 <br> (Exhibit 99.3) | 06/04/19 | 333-231935 |
| 10.9\* | [Third Amendment to the Pulmatrix, Inc. Amended and Restated 2013 Employee, Director and Consultant Equity Incentive Plan, dated as of September 6, 2019](https://www.sec.gov/Archives/edgar/data/1574235/000119312519240952/d796429dex101.htm) | Form 8-K<br> (Exhibit 10.1) | 09/09/19 | 001-36199 |
| 10.10\*\* | [License, Development and Commercialization Agreement, by and between Pulmatrix, Inc. and Johnson & Johnson Enterprise Innovation, Inc., dated as of December 26, 2019](https://www.sec.gov/Archives/edgar/data/1574235/000119312520086168/d862269dex1013.htm) | Form 10-K<br> (Exhibit 10.13) | 03/26/20 | 001-36199 |
| 10.11 | [Securities Purchase Agreement](https://www.sec.gov/Archives/edgar/data/1574235/000149315220006575/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 04/16/20 | 001-36199 |
| 10.12 | [Form of Letter Agreement](https://www.sec.gov/Archives/edgar/data/1574235/000149315220012889/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 07/09/20 | 001-36199 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| 10.13 | [Form of Securities Purchase Agreement dated December 15, 2021, by and between Pulmatrix, Inc. and the purchaser parties thereto](https://www.sec.gov/Archives/edgar/data/1574235/000149315221031617/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 12/15/21 | 001-36199 |
| 10.14\*\* | [Second Amendment to Development and Commercialization Agreement, dated as of November 8, 2021, by and between Cipla Technologies, LLC and Pulmatrix, Inc.](https://www.sec.gov/Archives/edgar/data/1574235/000149315221027587/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 11/09/21 | 001-36199 |
| 10.15 | [Form of Securities Purchase Agreement dated February 11, 2021, by and between Pulmatrix, Inc. and the purchaser parties thereto](https://www.sec.gov/Archives/edgar/data/1574235/000149315221003992/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 02/16/21 | 001-36199 |
| 10.16\* | [Consulting Agreement, dated November 30, 2021, by and between Pulmatrix, Inc. and Danforth Advisors, LLC](https://www.sec.gov/Archives/edgar/data/1574235/000149315222010083/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 04/14/22 | 001-36199 |
| 10.17\*\*\* | [Third Amendment to the Development and Commercialization Agreement, dated as of January 6, 2024, by and among Pulmatrix, Inc., Pulmatrix Operating Company, Inc., and Cipla Technologies LLC.](https://www.sec.gov/Archives/edgar/data/1574235/000149315224001667/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 01/08/24 | 001-36199 |
| 10.18\* | [Letter Agreement, dated January 6, 2024, by and between Teofilo Raad and the Company](https://www.sec.gov/Archives/edgar/data/1574235/000149315224001667/ex10-2.htm) | Form 8-K<br> (Exhibit 10.2) | 01/08/24 | 001-36199 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| 10.19 | [Bill of Sale and Assignment Agreement, dated as of May 28, 2024, by and between Pulmatrix, Inc. and MannKind Corporation](https://www.sec.gov/Archives/edgar/data/1574235/000149315224031478/ex10-4.htm) | Form 10-Q<br> (Exhibit 10.4) | 08/13/24 | 001-36199 |
| 10.20 | [Intellectual Property Cross License Agreement, dated as of May 28, 2024, by and between Pulmatrix, Inc. and MannKind Corporation](https://www.sec.gov/Archives/edgar/data/1574235/000149315224031478/ex10-5.htm) | Form 10-Q<br> (Exhibit 10.5) | 08/13/24 | 001-36199 |
| 10.21 | [Master Services Agreement, dated as of May 28, 2024, by and between Pulmatrix, Inc. and MannKind Corporation](https://www.sec.gov/Archives/edgar/data/1574235/000149315224031478/ex10-6.htm) | Form 10-Q<br> (Exhibit 10.6) | 08/13/24 | 001-36199 |
| 10.22\* | [General Release and Severance Agreement, dated as of July 19, 2024, by and between Pulmatrix, Inc. and Teofilo Raad](https://www.sec.gov/Archives/edgar/data/1574235/000149315224028507/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 07/19/24 | 001-36199 |
| 10.23\* | [Amendment No. 3 to Consulting Agreement, dated as of July 15, 2024, by and between Pulmatrix, Inc. and Danforth Advisors, LLC](https://www.sec.gov/Archives/edgar/data/1574235/000149315224028507/ex10-2.htm) | Form 8-K<br> (Exhibit 10.2) | 07/19/24 | 001-36199 |
| 10.24\* | [Letter Agreement, dated as of July 15, 2024, by and between Pulmatrix, Inc. and Peter Ludlum](https://www.sec.gov/Archives/edgar/data/1574235/000149315224028507/ex10-3.htm) | Form 8-K<br> (Exhibit 10.3) | 07/19/24 | 001-36199 |
| 10.25 | [Form of Cullgen Support Agreement](https://www.sec.gov/Archives/edgar/data/1574235/000149315224044986/ex10-1.htm) | Form 8-K<br> (Exhibit 10.1) | 11/13/24 | 001-36199 |
| 10.26 | [Form of Lock-Up Agreement](https://www.sec.gov/Archives/edgar/data/1574235/000149315224044986/ex10-2.htm) | Form 8-K<br> (Exhibit 10.2) | 11/13/24 | 001-36199 |
| 10.27\*\*\* | [Form of Registration Rights Agreement](https://www.sec.gov/Archives/edgar/data/1574235/000149315224044986/ex10-3.htm) | Form 8-K<br> (Exhibit 10.3) | 11/13/24 | 001-36199 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| 16.1 | [Letter from Marcum LLP to the Securities and Exchange Commission dated April 8, 2025](https://www.sec.gov/Archives/edgar/data/1574235/000164117225003216/ex16-1.htm) |  | Form 8-K<br> (Exhibit 16.1) | 04/08/25 | 001-36199 |
| 19.1\*\*\* | [Insider Trading Policy of Pulmatrix, Inc.](ex19-1.htm) | X |  |  |  |
| 21.1 | [List of Subsidiaries](https://www.sec.gov/Archives/edgar/data/1574235/000149315225011084/ex21-1.htm) |  | Form 10-K<br> (Exhibit 21.1) | 03/21/25 | 001-36199 |
| 23.1 | [Consent of CBIZ CPAs P.C., independent registered public accounting firm, to the Form 10-K](ex23-1.htm) | X |  |  |  |
| 23.2 | [Consent of Marcum LLP, independent registered public accounting firm, to the Form 10-K](ex23-2.htm) | X |  |  |  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| 31.1 | [Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ex31-1.htm) | X |  |  |  |
| 32.1 | [Certification of Interim Chief Executive Officer and Interim Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ex32-1.htm) | X<br> (furnished herewith) |  |  |  |
| 97.1 | [Compensation Recovery Policy](https://www.sec.gov/Archives/edgar/data/1574235/000149315224011630/ex97-01.htm) |  | Form 10-K (Exhibit 97.01) | 03/28/24 | 001-36199 |
| 101. INS | Inline XBRL Instance Document | X |  |  |  |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | X |  |  |  |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | X |  |  |  |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | X |  |  |  |
| 101.LAB | Inline XBRL Taxonomy Extension Labels Linkbase Document | X |  |  |  |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | X |  |  |  |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |  |  |  |  |

---

\* These exhibits are management contracts or compensatory plans or arrangements.

\*\* Portions of this exhibit have been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K under the Securities Act of 1933, as amended, because they are both (i) not material and (ii) the type that the registrant treats as private or confidential. A copy of the omitted portions will be furnished to the SEC upon its request.

\*\*\* Certain of the schedules (and similar attachments) to this exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K under the Securities Act because they do not contain information material to an investment or voting decision and that information is not otherwise disclosed in the exhibit or the disclosure document. The registrant hereby agrees to furnish a copy of all omitted schedules (or similar attachments) to the SEC upon its request.

**SIGNATURES**

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized**.**

---

| | | | |
|:---|:---|:---|:---|
| | | **PULMATRIX, INC.** | **PULMATRIX, INC.** |
| Date: | February 26, 2026 | By: | */s/ Peter Ludlum* |
|  |  |  | Peter Ludlum |
|  |  |  | Interim Chief Executive Officer and Interim Chief Financial Officer<br> (Principal Executive, Financial and Accounting Officer) |

---

**POWER OF ATTORNEY**

KNOW ALL PERSONS BY THESE PRESENTS, that each of the undersigned directors of Pulmatrix, Inc., a Delaware corporation, hereby constitutes and appoints Peter Ludlum as his true and lawful attorney-in-fact and agent, with full power of substitution and revocation, for and in his or her name, place and stead, in any and all capacities, to sign the Annual Report on Form 10-K of Pulmatrix, Inc. for the year ended December 31, 2025, and any and all amendments and supplements thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary as fully as to all intents and purposes as he or she might or could do in person, and hereby ratifying and confirming all that each said attorney-in-fact and agent or his or her substitute(s) may lawfully do or cause to be done by virtue hereof.

---

| | | |
|:---|:---|:---|
| **Signature** | **Title** | **Date** |
| */s/ Peter Ludlum* | Interim Chief Executive Officer and Interim Chief Financial Officer | February 26, 2026 |
| Peter Ludlum | Interim Chief Executive Officer and Interim Chief Financial Officer |  |
|  | (Principal Executive, Financial and Accounting Officer) |  |
| */s/ Michael J. Higgins* | Chairman of the Board of Directors | February 26, 2026 |
| Michael J. Higgins |  |  |
| */s/ Richard Batycky, Ph.D.* | Director | February 26, 2026 |
| Richard Batycky, Ph.D. |  |  |
| */s/ Todd Bazemore* | Director | February 26, 2026 |
| Todd Bazemore |  |  |
| */s/ Christopher Cabell, M.D.* | Director | February 26, 2026 |
| Christopher Cabell, M.D. |  |  |
| */s/ Anand Varadan* | Director | February 26, 2026 |
| Anand Varadan |  |  |

---

**PULMATRIX, INC.**

**INDEX TO CONSOLIDATED FINANCIAL STATEMENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [Report of Independent Registered Public Accounting Firm](#sk_002) – CBIZ CPAs P.C. (PCAOB ID: 199) | F-2 |
| [Report of Independent Registered Public Accounting Firm](#da_001) – Marcum LLP (PCAOB ID: 688) | F-3 |
| [Consolidated Balance Sheets as of December 31, 2025 and 2024](#sk_003) | F-4 |
| [Consolidated Statements of Operations for the Years Ended December 31, 2025 and 2024](#sk_004) | F-5 |
| [Consolidated Statements of Stockholders' Equity for the Years Ended December 31, 2025 and 2024](#sk_005) | F-6 |
| [Consolidated Statements of Cash Flows for the Years Ended December 31, 2025 and 2024](#sk_006) | F-7 |
| [Notes to Consolidated Financial Statements](#sk_007) | F-8 |

---

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Stockholders and Board of Directors of

**Pulmatrix, Inc.**

***Opinion on the Financial Statements***

We have audited the accompanying consolidated balance sheet of Pulmatrix, Inc. (the "Company") as of December 31, 2025, the related consolidated statements of operations, stockholders' equity and cash flows for the year ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the year ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

***Basis for Opinion***

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

**Critical Audit Matters**

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

*/s/ CBIZ CPAs P.C.*

CBIZ CPAs P.C.

We have served as the Company's auditor since 2015 (such date takes into account the acquisition of the attest business of Marcum LLP by CBIZ CPAs P.C. effective November 1, 2024).

New York, NY

February 26, 2025

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Stockholders and Board of Directors of

**Pulmatrix, Inc.**

***Opinion on the Financial Statements***

We have audited the accompanying consolidated balance sheet of Pulmatrix, Inc. (the "Company") as of December 31, 2024, the related consolidated statements of operations, stockholders' equity and cash flows for the year ended December 31, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its operations and its cash flows for the year ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

***Basis for Opinion***

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

**Critical Audit Matters**

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

*/s/ Marcum LLP*

Marcum LLP

We have served as the Company's auditor from 2015 through April 2025.

New York, NY

March 21, 2025

**PULMATRIX, INC.**

**Consolidated Balance Sheets**

**(in thousands, except share and per share data)**

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **December 31, 2024** |
| **Assets** |  |  |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $4088 | $9521 |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 41 | 399 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 4129 | 9920 |
| Long-term restricted cash | 10 | 10 |
| Other long-term assets | - | 13 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $4139 | $9943 |
| **Liabilities and stockholders' equity** |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable | $272 | $809 |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | 57 | 120 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 329 | 929 |
| Warrant liability | - | 67 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 329 | 996 |
| Commitments and contingencies (Note 9) |  |  |
| Stockholders' equity: |  |  |
| &nbsp;&nbsp;&nbsp;Preferred stock, $0.0001 par value — 500,000 shares authorized; 6,746 shares designated Series A convertible preferred stock; no shares issued and outstanding at December 31, 2025 and 2024 |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, $0.0001 par value — 200,000,000 shares authorized; 3,652,285 shares issued and outstanding at December 31, 2025 and 2024 |  |  |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital | 306128 | 306103 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (302318) | (297156) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stockholders' equity | 3810 | 8947 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and stockholders' equity | $4139 | $9943 |

---

*The accompanying footnotes are an integral part of these consolidated financial statements.*

 

**PULMATRIX, INC.**

**Consolidated Statements of Operations**

**(in thousands, except share and per share data)**

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2025** | **2024** |
| **Revenues** | $- | $7806 |
| **Operating expenses:** |  |  |
| &nbsp;&nbsp;&nbsp;Research and development | 38 | 7166 |
| &nbsp;&nbsp;&nbsp;General and administrative | 5131 | 7785 |
| &nbsp;&nbsp;&nbsp;Loss on MannKind Transaction | - | 2618 |
| Total operating expenses | 5169 | 17569 |
| Loss from operations | (5169) | (9763) |
| **Other income (expense):** |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 144 | 467 |
| &nbsp;&nbsp;&nbsp;Fair value adjustment of warrants | 67 | (67) |
| &nbsp;&nbsp;&nbsp;Other expense, net | (204) | (196) |
| Total other income (expense), net | 7 | 204 |
| Net loss | $(5162) | $(9559) |
| Net loss per share attributable to common stockholders – basic and diluted | $(1.41) | $(2.62) |
| Weighted average common shares outstanding – basic and diluted | 3652285 | 3652285 |

---

*The accompanying footnotes are an integral part of these consolidated financial statements.*

 

**PULMATRIX, INC.**

**Consolidated Statements of Stockholders' Equity**

**(in thousands, except share data)**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Additional Paid-in**<br>**Capital** | **Accumulated**<br>**Deficit** | **Total Stockholders'**<br>**Equity** |
| Balance — January 1, 2024 |  | $- | 3652285 | $&nbsp;&nbsp;&nbsp;&nbsp; - | $305592 | $(287597) | $17995 |
| &nbsp;&nbsp;&nbsp;Stock-based compensation |  |  |  |  | 511 |  | 511 |
| &nbsp;&nbsp;&nbsp;Net loss |  | - | - | - | - | (9559) | (9559) |
| Balance — December 31, 2024 |  | $- | 3652285 | $- | $306103 | $(297156) | $8947 |
| &nbsp;&nbsp;&nbsp;Stock-based compensation |  |  |  |  | 25 |  | 25 |
| &nbsp;&nbsp;&nbsp;Net loss |  | - | - | - | - | (5162) | (5162) |
| Balance — December 31, 2025 |  | $- | 3652285 | $- | $306128 | $(302318) | $3810 |

---

*The accompanying footnotes are an integral part of these consolidated financial statements.*

 

**PULMATRIX, INC.**

**Consolidated Statements of Cash Flows**

**(in thousands)**

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2025** | **2024** |
| **Cash flows from operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Net loss | $(5162) | $(9559) |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization |  | 106 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of operating lease right-of-use asset |  | 329 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 25 | 511 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on disposals |  | 2618 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair value adjustment of warrants | (67) | 67 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable |  | 928 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 358 | 343 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other long-term assets | 13 | 163 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | (537) | (1106) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | (63) | (438) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liability |  | (333) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenue | - | (4345) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in operating activities | (5433) | (10716) |
| **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Purchases of property and equipment | - | (398) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in investing activities | - | (398) |
| **Net decrease in cash, cash equivalents and restricted cash** | (5433) | (11114) |
| **Cash, cash equivalents and restricted cash — beginning of period** | 9531 | 20645 |
| **Cash, cash equivalents and restricted cash — end of period** | $4098 | $9531 |
| **Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheets:** |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $4088 | $9521 |
| &nbsp;&nbsp;&nbsp;Long-term restricted cash | 10 | 10 |
| Total cash, cash equivalents and restricted cash | $4098 | $9531 |
| **Supplemental disclosures of non-cash investing and financing information:** |  |  |
| &nbsp;&nbsp;&nbsp;Reduction of operating lease right-of-use asset and lease liability upon lease modification | $- | $8423 |

---

*The accompanying footnotes are an integral part of these consolidated financial statements.*

 

**PULMATRIX, INC.**

**Notes to Consolidated Financial Statements**

**(in thousands, except share and per share data)**

**1. Nature of the Business**

Pulmatrix, Inc. ("Pulmatrix" or the "Company") was incorporated in 2013 as a Delaware corporation. The Company is a biopharmaceutical company that has focused on the development of a novel inhaled therapeutic products intended to prevent and treat migraine and respiratory diseases with important unmet medical needs using its patented iSPERSE™ technology. The Company's proprietary dry powder delivery platform, iSPERSE™, is engineered to deliver small, dense particles with highly efficient dispersibility and delivery to the airways, which can be used with an array of dry powder inhaler technologies and can be formulated with a variety of drug substances.

**Agreement and Plan of Merger and Reorganization**

On November 13, 2024, Pulmatrix and Cullgen Inc., a Delaware corporation ("Cullgen") entered into an Agreement and Plan of Merger and Reorganization, as amended by Amendment No. 1 thereto on April 7, 2025 (the "Merger Agreement"), pursuant to which, among other matters, PCL Merger Sub, Inc., a direct wholly owned subsidiary of Pulmatrix ("Merger Sub"), will merge with and into Cullgen, with Cullgen surviving as a wholly owned subsidiary of Pulmatrix, and the surviving corporation of the merger (the "Merger").

Pursuant to the Merger Agreement, prior to the closing of the Merger (the "Closing"), Pulmatrix currently expects to declare a cash dividend to the pre-Merger Pulmatrix stockholders equal in the aggregate to Pulmatrix's reasonable, good faith approximation of the amount by which Pulmatrix's net cash (as determined pursuant to the Merger Agreement) will exceed $2.5 million, subject to certain adjustments and limitations (such excess amount, the "Cash Dividend").

Subject to the terms and conditions of the Merger Agreement, at the Closing, (a) each then-outstanding share of Cullgen common stock other than dissenting shares, will be converted into the right to receive a number of shares of Pulmatrix common stock calculated in accordance with the Merger Agreement (the "Exchange Ratio"), (b) each then-outstanding share of Cullgen preferred stock, other than dissenting shares, will be converted into the right to receive a number of shares of Pulmatrix common stock equal to the number of shares of Cullgen common stock issuable upon conversion of each share of Cullgen preferred stock multiplied by the Exchange Ratio and (c) each then-outstanding option to purchase Cullgen common stock, whether vested or unvested, will be assumed by Pulmatrix, subject to adjustment to reflect the Exchange Ratio as set forth in the Merger Agreement.

In connection with the Merger: (i) each share of Pulmatrix common stock that is issued and outstanding at the Effective Time (as defined below) of the Merger will remain issued and outstanding and such shares, subject to the proposed Pulmatrix reverse stock split, will be unaffected by the Merger; (ii) each option to acquire shares of Pulmatrix common stock outstanding but then not vested or exercisable shall be accelerated in full; (iii) each option to acquire shares of Pulmatrix common stock with an exercise price per share greater than $10.00 per share shall be cancelled for no consideration; (iv) each option to acquire shares of Pulmatrix common stock with an exercise price less than or equal to the Pulmatrix Closing Price (as defined herein) will be converted into the right to receive the number of shares underlying such Pulmatrix option, reduced as set forth in the Merger Agreement; (v) each option to acquire shares of Pulmatrix common stock with an exercise price greater than the volume weighted average closing trading price of a share of Parent Common Stock on Nasdaq for the five (5) consecutive trading days ending three (3) trading days immediately prior to the Closing Date as reported by Bloomberg L.P. (the "Pulmatrix Closing Price"), but less than $10.00 per share, will remain outstanding; and (vi) each warrant to acquire shares of Pulmatrix common stock that is outstanding and unexercised immediately prior to the Effective Time of the Merger shall survive the Closing and remain outstanding in accordance with its terms; provided that the holders of any such warrants which remain outstanding following closing may elect to require Pulmatrix to pay such holders cash in exchange for the termination of the remaining unexercised portion of such warrants if contemplated by the terms of such warrants.

Under the Exchange Ratio formula in the Merger Agreement, upon the Closing, on a pro forma basis and based upon the number of shares of Pulmatrix common stock expected to be issued in the Merger, pre-Merger Cullgen stockholders will own approximately 96.4% of the combined company and pre-Merger Pulmatrix stockholders will own approximately 3.6% of the combined company on a fully-diluted basis (excluding out-of-the-money options and warrants and any shares reserved for future grants under Pulmatrix's equity incentive plans). Under certain circumstances further described in the Merger Agreement, the ownership percentages may be adjusted upward or downward based on Pulmatrix's net cash at the Closing.

The Exchange Ratio assumes (i) a valuation for Pulmatrix of $10.5 million (comprised of $8 million in enterprise value and $2.5 million in cash) and (ii) a valuation for Cullgen of $280.0 million. The Exchange Ratio is also based on the relative capitalization of each of Pulmatrix and Cullgen, for which, for the purposes of calculating the Exchange Ratio, the shares of Pulmatrix common stock underlying Pulmatrix's in-the-money stock options outstanding immediately prior to the time of the Closing (the "Effective Time"), as adjusted to take into account the Cash Dividend will be deemed outstanding, and all shares of Cullgen common stock underlying outstanding Cullgen's stock options will be deemed outstanding, subject to certain exceptions as set forth in the Merger Agreement.

On June 16, 2025, the Company held a special meeting in lieu of the annual meeting of Pulmatrix stockholders, at which the Company's stockholders approved the Merger and related proposals. The Closing is subject to other customary closing conditions, including Nasdaq's approval of the listing of the shares of Pulmatrix common stock to be issued in connection with the Merger and approval from the China Securities Regulatory Commission ("CSRC") pursuant to the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Enterprises (the "Trial Measures"), No. 1 to No. 6 Supporting Guidance Rules, the Notice on Administration Arrangements for the Filing of Overseas Listings by Domestic Enterprises and the relevant CSRC Answers to Reporter Questions on the official website of the CSRC. These regulations established a filing-based regime to regulate overseas offerings and listings by Chinese domestic companies. As of the date of this filing, Pulmatrix has not yet received approval from the CSRC to complete the Merger. As previously disclosed, on August 1, 2025, Pulmatrix and Cullgen, as provided for in the Merger Agreement, mutually agreed to extend the "End Date", a term defined in the Merger Agreement, by 60 days from August 13, 2025, to October 12, 2025. The Merger Agreement does not have a defined term and does not terminate on the "End Date". The "End Date" is simply the date at which certain termination options become available to either party.

On December 17, 2025, the Company, Cullgen and PLC Merger Sub, Inc. (collectively, the "Parties") entered into a mutual waiver agreement (the "Waiver Agreement"), pursuant to which the Parties agreed to mutually waive compliance with Section 5.4 of the Merger Agreement, which such provision imposes restrictions on each party during the Pre-Closing Period (as defined in the Merger Agreement). Except as expressly waived pursuant to the Waiver Agreement, the Merger Agreement remains in full force and effect in all respects, and no other provision of the Merger Agreement has otherwise been amended, waived, or modified.

If the Merger is completed, the business of Cullgen will continue as the business of the combined company. Concurrent with the Merger, the Company will seek to monetize its intellectual property, including iSPERSE™ and its clinical assets (the "Asset Sale").

The Company's future operations are highly dependent on the success of the Merger and there can be no assurances that the Merger will be successfully consummated. There can be no assurance that the strategic review process or any transaction relating to a specific asset, including the Merger and any Asset Sale, will result in the Company pursuing such a transaction, or that any transactions, if pursued, will be completed on terms favorable to Pulmatrix and its stockholders in the existing Pulmatrix entity or any possible entity that results from a combination of entities. If the strategic review process is unsuccessful, and if the Merger is not consummated, the Company's board of directors may decide to pursue a dissolution and liquidation in the future.

**2. Summary of Significant Accounting Policies and Recent Accounting Standards**

**Principles of Consolidation**

The consolidated financial statements represent the consolidation of the accounts of the Company and its subsidiaries in conformity with generally accepted accounting principles in the United States of America ("U.S. GAAP"). All intercompany accounts and transactions have been eliminated in consolidation. Any reference in these notes to applicable guidance is meant to refer to the U.S. GAAP as found in the Accounting Standards Codification ("ASC") and Accounting Standards Update ("ASU") of the Financial Accounting Standards Board ("FASB").

**Risks, Uncertainties and Liquidity**

The Company's future operations are highly dependent on the success of the Merger and there can be no assurances that the Merger will be successfully consummated. If the Merger is not consummated, the Company believes that its cash and cash equivalents as of December 31, 2025, would be adequate to fund its operating expenses for at least twelve months from the date these consolidated financial statements are issued. However, in order to continue development of its programs, the Company would need to secure substantial additional funding in the future, from one or more equity or debt financings, collaborations, or other sources. Additional funding may not be available to the Company on acceptable terms, or at all. The Company's board of directors may also decide in the future to pursue a dissolution and liquidation in lieu of continuing program development.

Should the Company continue development of its product candidates, the Company would be subject to risks and uncertainties. The ongoing research and development activities will be subject to extensive regulation by numerous governmental authorities in the United States. Prior to marketing in the United States, any drug developed by the Company must undergo rigorous preclinical and clinical testing and an extensive regulatory approval process implemented by the United States Food and Drug Administration ("FDA") under the Food, Drug and Cosmetic Act. The Company has limited experience in conducting and managing the preclinical and clinical testing necessary to obtain regulatory approval. There can be no assurance that the Company will not encounter problems in the clinical trials that will cause the Company or the FDA to delay or suspend clinical trials.

The Company's success in developing its product candidates would depend in part on its ability to obtain patents and product license rights, maintain trade secrets, and operate without infringing on the property rights of others, both in the United States and other countries. There can be no assurance that patents issued to or licensed by the Company will not be challenged, invalidated, circumvented, or that the rights granted thereunder will provide proprietary protection or competitive advantages to the Company.

**Use of Estimates**

In preparing the consolidated financial statements in conformity with U.S. GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported amounts of expenses during the reporting period. Due to inherent uncertainty involved in making estimates, actual results may differ from these estimates. On an ongoing basis, the Company evaluates its estimates and assumptions, with any changes applied prospectively.

**Concentrations of Credit Risk**

Cash and cash equivalents is a financial instrument that potentially subjects the Company to concentrations of credit risk. For all periods presented, substantially all of the Company's cash was deposited in accounts at a single financial institution that management believes is creditworthy, and the Company has not incurred any losses to date. The Company is exposed to credit risk in the event of default by this financial institution for amounts in excess of the Federal Deposit Insurance Corporation insured limits.

For the year ended December 31, 2025, the Company recognized no revenue. For the year ended December 31, 2024, revenue from two customers accounted for 100% of revenue recognized in the accompanying consolidated financial statements.

**Cash, Cash Equivalents and Restricted Cash**

Cash and cash equivalents are held in US banks and consist of cash deposited in operating and money market accounts.

As of December 31, 2025, $10 was deposited in a money market account as security for a credit card and presented as long-term restricted cash in the consolidated balance sheet.

During the year ended December 31, 2024, $1,421 of restricted cash collateralizing a letter of credit related to the Company's former headquarters lease in Bedford, Massachusetts, became unrestricted, providing additional cash available for operations.

**Fair Value of Financial Instruments**

The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. FASB ASC Topic 820, *Fair Value Measurement*, establishes a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The three levels of the fair value hierarchy are described below:

Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2 — Valuations based on quoted prices for similar assets or liabilities in markets that are not active, or for which all significant inputs are observable, either directly or indirectly.

Level 3 — Valuations that require inputs that reflect the Company's own assumptions that are both significant to the fair value measurement and unobservable.

To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

As of December 31, 2024, certain of the Company's outstanding warrants were classified as liabilities and measured at fair value in accordance with FASC ASC Topic 815, *Derivatives and Hedging*. The Company measures the Level 3 fair value of the warrant liability using the Black-Scholes option-pricing model with changes in fair value recognized as increases or reductions to other income (expense) in the consolidated statement of operations. These warrants expired during the year ended December 31, 2025.

As of December 31, 2025 and 2024, the Company did not hold any other financial assets or liabilities that were measured at fair value on a recurring or nonrecurring basis. During the years ended December 31, 2025 and 2024, there were no transfers between Level 1, Level 2 and Level 3.

**Leases**

The Company accounts for leases in accordance with FASB ASC Topic 842, *Leases*. At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. The Company has elected not to recognize on the balance sheet leases with terms of one year or less. Options to renew a lease are not included in the Company's initial lease term assessment unless there is reasonable certainty that the Company will renew. The Company monitors its plans to renew its material leases on a quarterly basis.

Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected remaining lease term. However, certain adjustments to the right-of-use asset may be required for items, such as incentives received. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company utilizes its incremental borrowing rates, which are the rates incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. The Company has elected to account for the lease and non-lease components as a combined lease component. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term.

**Revenue Recognition**

No revenues were recognized for the year ended December 31, 2025. The Company's principal source of revenue during the year ended December 31, 2024, was derived from a collaboration arrangement and license agreement that relate to the development and commercialization of PUR1900 under the Cipla Agreement (as defined below).

At inception, management determines whether contracts are within the scope of FASB ASC Topic 606, *Revenue from Contracts with Customers* ("ASC 606") or other topics, including FASB ASC Topic 808, *Collaborative Arrangements* ("ASC 808"). For contracts that are within the scope of ASC 808, the Company evaluates whether the counterparty is a customer for any of the units of account (i.e., distinct goods and services) in the contract. For units of account where the counterparty is considered a customer, the Company applies ASC 606 to those unit(s) of account, including recognition, measurement, presentation, and disclosure guidance. To date, the Company has determined it is appropriate to apply ASC 606 to all contracts and units of account for contracts within the scope of ASC 808.

For contracts and units of account that are determined to be within the scope of ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which management expects to be entitled to receive in exchange for these goods and services. To achieve this core principle, management applies the following five steps (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when or as the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer.

*Identification of Performance Obligations.* Performance obligations promised in a contract are identified at contract inception based on the goods and services that are both capable of being distinct and are distinct in the context of the contract. To the extent a contract includes multiple promised goods and services, management applies judgment to determine whether promised goods and services are both capable of being distinct and distinct in the context of the contract. If these criteria are not met, the promised goods and services are accounted for as a combined performance obligation.

*Transaction Price and Milestone Payments.* The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring goods and services to the customer. At the inception of each contract that includes research or development milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company's control or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. Management evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each reporting period, management reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjust the estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment.

*Exclusive Licenses.* If the license to the Company's intellectual property is determined to be distinct from the other promises or performance obligations identified in the arrangement, the Company recognizes revenue from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. In assessing whether a promise or performance obligation is distinct from the other promises, the Company considers factors such as the research, development, manufacturing and commercialization capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the counterparty can benefit from a promise for its intended purpose without the receipt of the remaining promise, whether the value of the promise is dependent on the unsatisfied promise, whether there are other vendors that could provide the remaining promise, and whether it is separately identifiable from the remaining promise. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. The measure of progress, and thereby periods over which revenue should be recognized, are subject to estimates by management and may change over the course of the research and development and licensing agreement. Such a change could have a material impact on the amount of revenue the Company records in future periods.

*Research and Development Services.* The promises under the Company's arrangements may include research and development services to be performed by the Company on behalf of the counterparty. Payments or reimbursements from customers resulting from the Company's research and development efforts are recognized as the services are performed and presented on a gross basis because the Company is the principal for such efforts. The Company uses an input method, according to the ratio of costs incurred to the total costs expected to be incurred in the future to satisfy the performance obligation. In management's judgment, this input method is the best measure of the transfer of control of the performance obligation. Amounts received prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Reimbursements from and payments to the counterparty that are the result of a collaborative relationship, instead of a customer relationship, such as co-development activities, are recognized as the services are performed and presented as a reduction to research and development expense. To date, the Company has determined that all arrangements which include research and development services have been transacted with customers and recognized on a gross basis using ASC 606.

 

*Royalties.* For contracts that include sales-based royalties, including milestone payments upon first commercial sales and milestone payments based on a level of sales, which are the result of a customer-vendor relationship and for which the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied or partially satisfied.

*Customer Options.* If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options that are not determined to be material rights are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. The Company evaluates the customer options for material rights, or options to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the outset of the arrangement. The Company allocates the transaction price to material rights based on the relative standalone selling price, which is determined based on the identified discount and the probability that the customer will exercise the option. Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised.

For a complete discussion of accounting for the Company's revenue contracts, see Note 5, *Significant Agreements*.

**Research and Development Costs**

Research and development costs are expensed as incurred and include salaries, benefits, bonus, stock-based compensation, license fees, milestone payments due under license agreements, costs paid to third-party contractors to perform research, conduct clinical trials, and develop drug materials and delivery devices; and associated overhead and facilities costs. Clinical trial costs are a substantial component of research and development expenses and include costs associated with third-party contractors, clinical research organizations ("CROs") and clinical manufacturing organizations ("CMOs"). Invoicing from third-party contractors for services performed can lag several months. The Company accrues the costs of services rendered in connection with third-party contractor activities based on management's estimate of fees and costs associated with the contract that were rendered during the period and they are expensed as incurred. Research and development costs that are paid in advance of performance are capitalized as prepaid expenses and amortized over the service period as the services are provided.

**Stock-based Compensation**

The Company recognizes all employee stock-based compensation as a cost in the consolidated financial statements. Equity-classified awards principally related to stock options, which are measured at the grant date fair value of the award. The Company determines grant-date fair value of stock option awards using the Black-Scholes option-pricing model. For service-based vesting grants, expense is recognized over the requisite service period based on the number of options or shares expected to ultimately vest. For performance-based vesting grants, expense is recognized over the requisite period until the performance obligation is met, assuming that it is probable. No expense is recognized for performance-based grants until it is probable the vesting criteria will be satisfied.

Stock-based payments to non-employees are recognized as services are rendered, generally on a straight-line basis. The Company believes that the fair values of these awards are more reliably measurable than the fair values of the services rendered.

**Common Stock Warrants**

The Company classifies as equity any warrants that (i) require physical settlement or net-share settlement or (ii) provide the Company with a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any warrants that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the Company's control), (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement) or (iii) that contain reset provisions that do not qualify for the scope exception. The Company assesses classification of its common stock warrants and other freestanding derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required. The Company's freestanding derivatives consist of warrants to purchase common stock that were issued in connection with its (i) convertible preferred stock, (ii) private placements, (iii) term loan, (iv) consulting services and (v) underwriting and representative services.

Warrants that are determined to require equity classification are measured at fair value upon issuance and are not subsequently remeasured unless they are required to be reclassified. Warrants that are determined to require liability classification are subject to re-measurement at each balance sheet date until exercised, terminated or reclassified, and any change in fair value is recognized in the Company's consolidated statements of operations.

**Basic and Diluted Net Loss Per Share**

Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is calculated by dividing the weighted-average number common shares outstanding during the period, after taking into consideration any potentially dilutive effects from outstanding stock options or warrants.

Basic and diluted earnings (loss) per share are computed using the two-class method, which is an earnings allocation method that determines earnings (loss) per share for common shares and participating securities. The participating securities consist of outstanding warrants to purchase common stock. Undistributed earnings are allocated between common shares and participating securities as if all earnings had been distributed during the period. In periods of loss, no allocation is made to the participating securities.

Basic and diluted net loss per share are the same in periods for which the effect of potentially dilutive securities would be antidilutive.

**Income Taxes**

Income taxes are recorded in accordance with FASB ASC Topic 740, *Income Taxes* ("ASC 740"), which provides for deferred taxes using an asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. A valuation allowance is provided, if, based upon the weight of available evidence, it is more likely than not that some or all of the net deferred tax assets will not be realized.

The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position, as well as consideration of the available facts and circumstances.

***Recent Accounting Pronouncements***

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies that are adopted by the Company as of the specified effective date. The Company did not adopt any new accounting pronouncements during the year ended December 31, 2025, that had a material effect on its consolidated financial statements.

In December 2023, the FASB issued Accounting Standard Update 2023-09, *Income Taxes (Topic 740): Improvements to Income Tax Disclosures* ("ASU 2023-09"). The guidance in ASU 2023-09 improves the transparency of income tax disclosures by greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. The standard becomes effective for the annual period beginning on January 1, 2025, with early adoption permitted. The Company prospectively adopted ASU 2023-09 in its 2025 annual period, which resulted in additional income tax disclosures. Refer to Note 11, *Income Taxes* for further information.

In November 2024, the FASB issued ASU 2024-03, *Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses* ("ASU 2024-03"). The guidance in ASU 2024-03 requires disclosure about the types of costs and expenses included in certain expense captions presented on the income statement. The new disclosure requirements are effective for the Company's annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact that adoption of ASU 2024-03 may have on its consolidated financial statements.

As of December 31, 2025, there are no other new, or existing recently issued, accounting pronouncements that are of significance, or potential significance, that impact the Company's consolidated financial statements.

**3. Prepaid Expenses and Other Current Assets**

Prepaid expenses and other current assets consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **December 31,**<br> **2025** | **December 31,**<br> **2024** |
| Software and hosting costs | $4 | $19 |
| Insurance | 3 | 200 |
| Other | 34 | 180 |
| &nbsp;&nbsp;&nbsp;Total prepaid expenses and other current assets | $41 | $399 |

---

**4. Accrued Expenses and Other Current Liabilities**

Accrued expenses and other current liabilities consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **December 31,**<br> **2025** | **December 31,**<br> **2024** |
| Wages and incentives | 41 | 38 |
| Legal and patents | 2 | 11 |
| Other | 14 | 71 |
| &nbsp;&nbsp;&nbsp;Total accrued expenses and other current liabilities | $57 | $120 |

---

**5. Significant Agreements**

*Development and Commercialization Agreement with Cipla Technologies LLC ("Cipla")*

On April 15, 2019, the Company entered into a Development and Commercialization Agreement (the "Cipla Agreement") with Cipla for the co-development and commercialization, on a worldwide exclusive basis, of PUR1900, the Company's inhaled iSPERSE*<sup>™</sup>* drug delivery system (the "Product") enabled formulation of the antifungal drug itraconazole, which is only available as an oral drug, for the treatment of all pulmonary indications, including allergic bronchopulmonary aspergillosis ("ABPA") in patients with asthma. The Company entered into an amendment to the Cipla Agreement on November 8, 2021 (the "Second Amendment") and a subsequent amendment on January 6, 2024 (the "Third Amendment"). All references to the Cipla Agreement herein refer to the Cipla Agreement, as amended.

The Company received a non-refundable upfront payment of $22.0 million (the "Upfront Payment") under the Cipla Agreement. Upon receipt of the Upfront Payment, the Company irrevocably assigned to Cipla the following assets, solely to the extent that each covers the Product in connection with any treatment, prevention, and/or diagnosis of diseases of the pulmonary system ("Pulmonary Indications"): all existing and future technologies, current and future drug master files, dossiers, third-party contracts, regulatory filings, regulatory materials and regulatory approvals, patents, and intellectual property rights, as well as any other associated rights and assets directly related to the Product, specifically in relation to Pulmonary Indications (collectively, the "Assigned Assets"), excluding most specifically the Company's iSPERSE*<sup>™</sup>* technology. A portion of the Upfront Payment was deposited by the Company into a bank account, along with an equal amount from the Company, and was dedicated to the development of the Product (the "Initial Development Funding"). The Initial Development Funding was depleted during the year ended December 31, 2021, at which point the Company and Cipla each became responsible for a portion of the development costs actually incurred as described below (the "Co-Development Phase").

Pursuant to the Second Amendment, the Company and Cipla were each responsible for 60% and 40%, respectively, of the Company's overhead costs and the time spent by the Company's employees and consultants on development of the Product ("Direct Costs"). The Company shared all other development costs with Cipla that were not Direct Costs, such as the cost of clinical research organizations, manufacturing costs and other third-party costs, on a 50/50 basis.

Pursuant to the Third Amendment, the Company and Cipla agreed that, during the period commencing on January 6, 2024 and ending July 30, 2024 (the "Wind Down Period"), the Company would complete all Phase 2b activities, assign or license all patents to Cipla and their registration with the appropriate authorities in regions other than the United States, complete a physical and demonstrable technology transfer and secure all data from the Phase 2b study for inclusion in the safety database. The Company shared costs with Cipla during the Wind Down Period in the same proportions in effect with the Second Amendment discussed above, but subject to a maximum reimbursement amount by Cipla as approved by the joint steering committee. The Company completed all Phase 2b activities by the end of the Wind Down Period.

 

*Accounting Treatment*

The Company originally concluded that because both it and Cipla are active participants in the arrangement and are exposed to the significant risks and rewards of the collaboration, the Company's collaboration with Cipla is within the scope of ASC 808. The Company concluded that Cipla is a customer since they contracted with the Company to obtain research and development services and a license to the Assigned Assets, each of which is an output of the Company's ordinary activities, in exchange for consideration. Therefore, the Company has applied the guidance in ASC 606 to account for the research and development services and a license within the contract. The Company determined that the research and development services and license to the Assigned Assets are considered highly interdependent and highly interrelated and therefore are considered a single combined performance obligation because Cipla cannot benefit from the license without the performance by the Company of the research and development services. Such research and development services are highly specialized and proprietary to the Company and therefore not available to Cipla from any other third party.

The Company initially determined the total transaction price to be $22.0 million – comprised of $12.0 million for research and development services for the Product and $10.0 million for the irrevocable license to the Assigned Assets. Any consideration related to the Co-Development Phase was not initially included in the transaction price as such amounts were subject to the variable consideration constraint. Additionally, the Company has fully constrained any transaction price that might be realized upon commercialization.

Revenue is recognized for the Cipla Agreement as the research and development services are provided using an input method, according to the ratio of costs incurred to the total costs expected to be incurred in the future to satisfy the Company's obligations. In management's judgment, this input method is the best measure of the transfer of control of the combined performance obligation. The amounts received that have not yet been recognized as revenue are recorded in deferred revenue on the Company's consolidated balance sheets, with amounts expected to be recognized in the next 12 months recorded as current.

The Company concluded that the Third Amendment is a contract modification that should be accounted for as part of the existing contract. During the years ended December 31, 2025 and 2024, the Company recognized $0 and $6.9 million, respectively, in revenue related to the research and development services and irrevocable license to the Assigned Assets in the Company's consolidated statements of operations. The revenue recognized during the year ended December 31, 2024 was primarily associated with the cumulative catch-up recorded as a result of the contract modification, that had been included in deferred revenue at the beginning of that period. As of December 31, 2025, all of the Company's performance obligations under the Cipla Agreement have been satisfied.

*Agreements with MannKind Corporation ("MannKind")*

On May 28, 2024, the Company executed certain agreements with MannKind and the Company's landlord (collectively, the "MannKind Transaction"), all of which closed during July 2024. The agreements with MannKind included a Bill of Sale and Assignment Agreement (the "Bill of Sale") with respect to the assignment of the Company's rental facility at 36 Crosby Drive, Bedford, Massachusetts (the "Bedford Facility") to MannKind along with the transfer of all leasehold improvements, laboratory equipment and other related personal property. In connection with the assignment of the Bedford Facility, the Company, MannKind and Cobalt Propco 2020, LLC (the "Landlord") entered into an Amendment to Lease and Consent to Assignment of Lease (the "Lease Assignment Agreement") pursuant to that certain Lease Agreement, dated as of January 7, 2022 (the "Lease Agreement"), by and between the Company and the Landlord. Pursuant to the Lease Assignment Agreement, MannKind assumed all of the Company's obligations under the Lease Agreement, including all rent and other payments.

In connection with these transactions, the Company and MannKind entered into an Intellectual Property Cross License Agreement (the "Cross License Agreement"). Pursuant to the Cross License Agreement, the Company granted to MannKind (i) an exclusive license to develop, use, manufacture, market, offer and sell iSPERSE formulations of Clofazimine, (ii) an exclusive license to develop, use, manufacture, market, offer and sell formulations of iSPERSE with one more active pharmaceutical ingredients for the treatment of nontuberculous mycobacteria lung disease in humans, (iii) an exclusive license to develop, use, manufacture, market, offer and sell iSPERSE formulations of insulin, (iv) a non-exclusive license to develop, use, manufacture, market, offer and sell formulations of iSPERSE with one more active pharmaceutical ingredients for the treatment of endocrine disease in humans, and (v) a non-exclusive license to develop, use, manufacture, market, offer and sell formulations of iSPERSE with one more active pharmaceutical ingredients for the treatment of interstitial lung diseases (including IPF, PPF and other related lung diseases) in humans (collectively, the "Out-License").

Additionally, pursuant to the Cross License Agreement, MannKind granted to the Company (i) the exclusive right to develop, use, manufacture, market, offer and sell its single-use disposable dry powder inhaler (including all modifications or improvement thereto made by or on behalf of the Company, the "Cricket Device") for the inhaled delivery of dihydroergotamine in any formulation whatsoever, including the Company's PUR3100 treatment of acute migraine and (ii) a non-exclusive license to develop, use, manufacture, market, offer and sell the Cricket Device for the inhaled delivery of one more active pharmaceutical ingredients formulated with iSPERSE for the treatment of neurological disease in humans (collectively, the "In-License").

Additionally, pursuant to the Master Services Agreement, by and between the Company and MannKind, MannKind shall provide certain development services to the Company, including but not limited to, activities to develop a dry powder formulation of the active pharmaceutical ingredient that the Company provides to MannKind for oral inhalation using iSPERSE.

To maintain continuity of iSPERSE platform knowledge, MannKind hired certain members of the Company's research and development staff in July 2024.

*Accounting Treatment*

The Company determined that the MannKind Transaction represents a combined agreement for accounting purposes, as the individual components have the same overall commercial objectives and the consideration under each component is dependent on the other components.

The consideration due to the Company in the MannKind Transaction consists solely of the non-cash consideration in the form of the In-License. The fair value of the non-cash consideration received should be allocated to the other components of the MannKind Transaction to determine the consideration received for the other components. The Company determined that the fair value of the In-License is immaterial given that adequate alternative inhaler devices are already available on the market (and indeed, the Company has already established use of another third-party inhalation device in their PUR3100 Phase 1 trial that performed well as a DHE delivery device as reported in a peer-reviewed publication), and considering optional purchases of Cricket Devices are at market prices. Accordingly, the consideration allocated to other components of the MannKind Transaction was immaterial.

During the year ended December 31, 2024, the Company accounted for the Lease Assignment Agreement upon execution as a lease modification that reduced the lease term to the assignment date in July 2024. Accordingly, the Company remeasured its operating lease liability as of the modification date to reflect the decrease in fixed lease payments, with the amount of the remeasurement, $8.4 million, adjusted by a corresponding reduction to the right-of-use asset.

The Company determined that its operating lease right-of-use asset and property and equipment subject to the Bill of Sale represented a disposal group. The Company recorded a full write-down of the disposal group's carrying value in the amount of $2.6 million during the year ended December 31, 2025.

Concurrent with the closing of the MannKind Transaction, the Company terminated and MannKind hired the majority of the Company's research and development employees, representing approximately two-thirds of the Company's workforce at the time. The Company agreed to provide termination benefits to these employees, which was fully paid during the year ended December 31, 2024.

**6. Common Stock**

In May 2021, the Company entered into an At-The-Market Sales Agreement (the "Sales Agreement") with H.C. Wainwright and Co., LLC ("HCW") to act as the Company's sales agent with respect to the issuance and sale of up to $20.0 million of the Company's shares of common stock, from time to time in an at-the-market public offering (the "ATM Offering"). Upon filing of the Annual Report, the Company continued to be subject to General Instruction I.B.6 of Form S-3, pursuant to which in no event will the Company sell its common stock in a registered primary offering using Form S-3 with a value exceeding more than one-third of its public float in any 12 calendar month period so long as its public float remains below $75,000,000. Therefore, the amount that may be able to be raised using the ATM Offering will be significantly less than $20,000,000, until such time as the Company's public float held by non-affiliates exceeds $75,000,000.

Sales of common stock under the Sales Agreement are made pursuant to an effective shelf registration statement on Form S-3, which was filed with the SEC on May 17, 2024, and subsequently declared effective on May 30, 2024 (File No. 333-279491), and a related prospectus. HCW acts as the Company's sales agent on a commercially reasonable efforts basis, consistent with its normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of The Nasdaq Capital Market. If expressly authorized by the Company, HCW may also sell the Company's common stock in privately negotiated transactions. There is no specific date on which the ATM Offering will end, there are no minimum sale requirements and there are no arrangements to place any of the proceeds of the ATM Offering in an escrow, trust or similar account. HCW is entitled to compensation at a fixed commission rate of 3.0% of the gross proceeds from the sale of the Company's common stock pursuant to the Sales Agreement.

During the years ended December 31, 2025, and 2024, no shares of common stock were sold under the Sales Agreement.

**7. Warrants**

The following table summarizes warrant activity for the year ended December 31, 2025:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of<br> Common Warrants** | **Weighted Average<br> Exercise Price** | **Average Remaining Contractual Term (Years)** | **Aggregate<br> Intrinsic Value** |
| Outstanding January 1, 2025 | 934373 | $55.01 |  |  |
| &nbsp;&nbsp;&nbsp;Warrants Expired | (551785) | 79.15 |  |  |
| Outstanding December 31, 2025 | 382588 | $20.20 | 0.82 | $- |

---

The following represents a summary of the warrants outstanding at December 31, 2025, all of which are equity-classified:

---

| | | | |
|:---|:---|:---|:---|
| **Issue Date** | **Adjusted <br> Exercise Price** | **Expiration Date** | **Number of Shares <br> Underlying Warrants** |
| December 17, 2021 | $14.99 | December 15, 2026 | 36538 |
| December 17, 2021 | $13.99 | December 17, 2026 | 281047 |
| February 16, 2021 | $49.99 | February 11, 2026 | 65003 |
| Total |  |  | 382588 |

---

Warrants to purchase 535,830 shares of common stock with a contingent cash redemption feature expired during the year ended December 31, 2025. These warrants included terms that could have given rise to an obligation of the Company to pay cash to its warrant holders following a change in control. Following the execution of the Merger Agreement on November 13, 2024, the Company concluded this contingent cash redemption feature was no longer within its control and accordingly reclassified these warrants from equity to liability, remeasuring the fair value of these warrants at approximately $67 thousand as of December 31, 2024, recording a corresponding loss in the Company's consolidated statements of operations. Since the warrants expired during the year ended December 31, 2025, prior to a change in control occurring, the Company recorded a gain of $67 thousand in the Company's consolidated statements of operations for the year ended December 31, 2025.

Warrants to purchase 65,003 shares of common stock, with a weighted-average exercise price of $49.99, expired subsequent to December 31, 2025, but before the date these consolidated financial statements were issued.

**8. Stock-based Compensation**

The Company sponsored the Pulmatrix, Inc. Amended and Restated 2013 Employee, Director and Consultant Equity Incentive Plan (the "Incentive Plan"), which expired on June 10, 2025. No new awards may be made under the Incentive Plan after its expiration date. Awards issued under the Incentive Plan prior to its expiration remain outstanding in accordance with their terms.

No stock options were granted during the years ended December 31, 2025, and 2024. The following table summarizes stock option activity for the year ended December 31, 2025:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of**<br> **Options** | **Weighted-**<br> **Average**<br> **Exercise**<br> **Price** | **Weighted-**<br> **Average**<br> **Remaining**<br> **Contractual Term**<br> **(Years)** | **Aggregate**<br> **Intrinsic**<br> **Value** |
| Outstanding — January 1, 2025 | 34046 | $30.55 |  |  |
| &nbsp;&nbsp;&nbsp;Forfeited or expired | (188) | 2350.64 |  |  |
| Outstanding — December 31, 2025 | 33858 | 17.67 | 5.72 | $- |
| Exercisable — December 31, 2025 | 30961 | 18.95 | 5.60 | $- |

---

The Company records stock-based compensation expense related to stock options based on their grant-date fair value. As of December 31, 2025, there was an immaterial amount of unrecognized stock-based compensation expense related to unvested stock options granted under the Company's Incentive Plan.

The following table presents total stock-based compensation expense for the years ended December 31, 2025, and 2024:

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2025** | **2024** |
| Research and development | $- | $149 |
| General and administrative | 25 | 362 |
| Total stock-based compensation expense | $25 | $511 |

---

**9. Commitments and Contingencies**

*Research and Development Activities*

The Company has contracted with various other organizations to conduct research and development activities, including clinical trials. The scope of the services under contracts for research and development activities may be modified and the contracts, subject to certain conditions, may generally be cancelled by the Company upon written notice. In some instances, the contracts, subject to certain conditions, may be cancelled by the third party. As of December 31, 2025, the Company had no material noncancellable commitments.

*Legal Proceedings*

In the ordinary course of its business, the Company may be involved in various legal proceedings involving contractual and employment relationships, patent or other intellectual property rights, and a variety of other matters. The Company is not aware of any pending legal proceedings that would reasonably be expected to have a material impact on the Company's financial position or results of operations.

**10. Leases**

Following the closing of the MannKind Transaction in the third quarter of 2024, in which the Company assigned its former lease to MannKind, the Company has operated as a virtual company. The Company entered into a short-term agreement to maintain a corporate address at 945 Concord Street, Framingham, Massachusetts. No lease liability or right-of-use asset has been recorded for this short-term lease, and the short-term lease cost associated with this lease is immaterial.

*Previous Headquarters*

On May 28, 2024, as part of the MannKind Transaction (see further discussion in Note 5, *Significant Agreements*), the Company and the Landlord executed the Lease Assignment Agreement to assign the Lease Agreement to MannKind in July 2024. The Company accounted for the Lease Assignment Agreement as a lease modification that reduced the lease term to the assignment date in July 2024. Accordingly, during the year ended December 31, 2024, the Company remeasured its lease liability as of the modification date to reflect the decrease in fixed lease payments, with the amount of the remeasurement, $8.4 million, adjusted by a corresponding reduction to the right-of-use asset.

Following the closing of the MannKind Transaction, $1.4 million of restricted cash was released in August 2024, which had been held in a depository account at a financial institution to collateralize a conditional stand-by letter of credit related to the Lease Agreement.

The components of lease expense for the Company for the years ended December 31, 2025, and 2024 were as follows:

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2025** | **2024** |
| Lease cost |  |  |
| &nbsp;&nbsp;&nbsp;Fixed lease cost | $- | $678 |
| &nbsp;&nbsp;&nbsp;Variable lease cost | - | 214 |
| &nbsp;&nbsp;&nbsp;Total lease cost | $- | $892 |
| Other information |  |  |
| &nbsp;&nbsp;&nbsp;Cash paid for amounts included in the measurement of lease liabilities | $- | $681 |
| &nbsp;&nbsp;&nbsp;Weighted-average remaining lease term |  |  |
| &nbsp;&nbsp;&nbsp;Weighted-average discount rate |  |  |

---

**11. Income Taxes**

The Company had no income tax expense due to operating losses incurred for the years ended December 31, 2025 and 2024.

The Company adopted ASU 2023-09 on a prospective basis beginning with the year ended December 31, 2025. The following table presents the required disclosure pursuant to ASU 2023-09 and reconciles the U.S. federal statutory tax amount and rate to the actual effective amount and rate for the year ended December 31, 2025:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2025** |
|  | Amount | Percent |
| U.S federal statutory tax rate | $(1084) | 21.0% |
| Changes in valuation allowances | 1018 | (19.7)% |
| Nontaxable or nondeductible items |  |  |
| &nbsp;&nbsp;&nbsp;Stock-based compensation | 63 | (1.2)% |
| &nbsp;&nbsp;&nbsp;Other | 3 | (0.1)% |
| Effective tax rate | $- | -% |

---

The following table presents the required disclosure prior to the adoption of ASU 2023-09 and reconciles the U.S. federal statutory income tax rate to the actual effective income tax rate for the years ended December 31, 2024:

---

| | |
|:---|:---|
|  | **2024** |
| Income tax computed at federal statutory tax rate | 21.0% |
| State taxes, net of federal benefit | 5.5% |
| Research and development credits | 5.8% |
| Expiration of stock options | (7.7)% |
| Permanent differences | (2.4)% |
| Limitations on credits and net operating losses | (1.2)% |
| Change in valuation allowance | (21.0)% |
| Effective tax rate | - |

---

The significant components of the Company's deferred tax assets as of December 31, 2025 and 2024 were as follows:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Deferred tax assets: |  |  |
| &nbsp;&nbsp;&nbsp;Net operating loss carryforwards | $19311 | $16116 |
| &nbsp;&nbsp;&nbsp;Capitalized research and experimental costs | 5708 | 7836 |
| &nbsp;&nbsp;&nbsp;Research and development credit carryforwards | 1945 | 1945 |
| &nbsp;&nbsp;&nbsp;Capitalized start-up expenses | 117 | 135 |
| &nbsp;&nbsp;&nbsp;Stock-based compensation | 108 | 183 |
| &nbsp;&nbsp;&nbsp;Other | 660 | 309 |
| Total deferred tax assets | 27849 | 26524 |
| Valuation allowance | (27849) | (26524) |
| Net deferred tax assets | $- | $- |

---

Subject to the limitations described below, as of December 31, 2025, the Company had federal net operating loss carryforwards of approximately $81.7 million available to reduce future taxable income, of which $3.8 million is subject to expiration between 2026 and 2037 and $77.9 million may be carried forward indefinitely. As of December 31, 2025, the Company had state net operating loss carryforwards of approximately $33.9 million, which is subject to expiration between 2030 and 2045. The Company also had research and development credits of approximately $1.9 million as of December 31, 2025 to offset future federal and state income taxes, which is subject to expiration at various times through 2044.

Under the provisions of the Internal Revenue Code, the net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. Net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50 percent, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years. The Company has completed several financings since its inception which it believes has resulted in changes in control as defined by Sections 382 and 383 of the Internal Revenue Code.

Management of the Company evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets and determined that it is more likely than not that the Company will not recognize the benefits of the deferred tax assets. As a result, a full valuation allowance was recorded as of December 31, 2025 and 2024. The valuation allowance increased by $1.3 million during the year ended December 31, 2025, primarily due to the increase in loss carryforwards by the Company.

The One Big Beautiful Bill Act ("OBBBA") was enacted in the U.S. on July 4, 2025. OBBBA introduced significant changes to the U.S. federal corporate tax system, including retroactive relief for certain small business taxpayers, such as reinstatement of immediate expensing for domestic research and development expenditures and modifications to the business interest expense limitation. Under U.S. GAAP, the effects of changes in tax laws are recognized in the period in which the new law is enacted. Accordingly, the provisions impacting the Company have been reflected in the financial statements for the year ended December 31, 2025, and did not have a material impact as the Company has a valuation allowance against its net deferred tax assets.

The Company is currently not under examination by the Internal Revenue Service or any other jurisdictions for any tax years. The Company files income tax returns in the United States for federal and state income taxes. In the normal course of business, the Company is subject to examination by tax authorities in the United States. Since the Company is in a loss carryforward position, the Company is generally subject to U.S. federal and state income tax examinations by tax authorities for all years for which a loss carryforward is utilized. The Company's returns remain subject to federal and state audits for the years 2022 through 2025. However, carryforward attributes from prior years may still be adjusted upon examination by tax authorities if they are used in an open period.

The Company may from time to time be assessed interest or penalties by major tax jurisdictions. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. The Company has not recorded interest or penalties on any unrecognized tax benefits since its inception.

The roll-forward of the Company's gross uncertain tax positions is as follows:

---

| | |
|:---|:---|
|  | **Gross<br> Uncertain<br> Tax Position** |
| Balance — January 1, 2024 | $505 |
| &nbsp;&nbsp;&nbsp;Additions for current year tax positions | 139 |
| Balance — December 31, 2024 | 644 |
| &nbsp;&nbsp;&nbsp;Additions for current year tax positions | - |
| Balance — December 31, 2025 | $644 |

---

The Company's total uncertain tax positions did not have any changes during the year ended December 31, 2025. None of the uncertain tax positions, if realized, would affect the Company's effective tax rate in future periods due to a valuation allowance provided against the Company's net deferred tax assets.

**12. Net Loss Per Share**

Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted loss per share is calculated by dividing net loss by the weighted-average number common shares outstanding during the period, after taking into consideration any potentially dilutive effects from outstanding stock options or warrants.

Basic and diluted net loss per share were the same for the years ended December 31, 2025, and 2024, as the effect of potentially dilutive securities would have been anti-dilutive. The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted-average shares outstanding, because such securities had an anti-dilutive impact:

Schedule of Computation of Anti-Dilutive Weighted-Average Shares Outstanding

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2025** | **2024** |
| Options to purchase common stock | 33858 | 34046 |
| Warrants to purchase common stock | 382588 | 934373 |
| &nbsp;&nbsp;&nbsp;Total potentially dilutive securities excluded | 416446 | 968419 |

---

**13. Segment Reporting**

The Company operates in a single reportable segment. The accounting policies of the segment are the same as those described in the summary of significant accounting policies (Note 2). The measure of segment assets is reported on the balance sheet as total consolidated assets.

The Company's chief operating decision maker ("CODM") is its chief executive officer, who reviews financial information presented on a consolidated basis. The CODM uses net loss to assess financial performance of the Company and allocate resources, in addition to operating forecasts and clinical results.

The Company's single segment revenue, significant segment expenses, other segment items and net loss are each presented separately on the Company's consolidated statements of operations.

**14. Subsequent Events**

The Company has completed an evaluation of all subsequent events after the balance sheet date of December 31, 2025, through the date the consolidated financial statements were issued to ensure that the consolidated financial statements include appropriate disclosure of events both recognized in the consolidated financial statements as of December 31, 2025, and events which occurred subsequently but were not recognized in the consolidated financial statements. The Company has concluded that no subsequent events have occurred that require disclosure, except as disclosed within the consolidated financial statements.

## Exhibit 19.1

**EXHIBIT 19.1**

**Pulmatrix, Inc.**

**Insider Trading Policy**

**Table of Contents**

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| | | |
|:---|:---|:---|
| 1 | Purpose | 2 |
| 2 | The Need for an Insider Trading Policy | 2 |
| 3 | What is Material Non-Public Information | 2 |
| 4 | The Consequences of Insider Trading | 4 |
| 5 | Our Policy | 4 |
| 6 | Individual Responsibility | 8 |
| 7 | Additional Prohibited Transactions | 9 |
| 8 | Post-Termination Transactions | 10 |
| 9 | Company Assistance | 10 |
| 10 | Certifications | 10 |
| 11 | Appendix | 10 |

---

---

| | |
|:---|:---|
| 1 | Purpose |

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Pulmatrix, Inc. (the "Company") has adopted the following policy regarding trading by Company personnel in the Company's securities (the "Insider Trading Policy," or this "Policy"). This Policy applies to all Company personnel, including directors, officers, employees and consultants of the Company and its subsidiaries. This Policy also applies to certain family members, other members of a person's household and entities controlled by Company personnel, as described in Section 5 below.<sup>1</sup>

2 The Need for an Insider Trading Policy

This Policy has been developed:

● to educate all Company personnel as to the federal securities laws and the rules of the Securities and Exchange Commission (the "SEC") on insider trading in public company securities;

● to set forth requirements that apply to Company personnel and other persons covered by this Policy who seek to trade in the Company's securities;

● to protect the Company and its personnel from legal liability; and

● to preserve the reputation of the Company and its personnel for integrity and ethical conduct.

Because the Company is a public company, transactions in the Company's securities are subject to the federal securities laws and regulations adopted by the SEC. These laws and regulations make it illegal for an individual to buy or sell securities of the Company while aware of ***material non-public information***. The SEC takes insider trading very seriously and devotes significant resources to uncovering the activity and to prosecuting offenders. Liability may extend not only to the individuals who trade while in possession of material non-public information but also to their "tippers," people who leak material non-public information to individuals who then trade based on that information.<sup>2</sup> The Company and "controlling persons" of the Company may also be liable for violations by Company employees.<sup>3</sup>

3 What is Material Non-Public Information

&nbsp;&nbsp;&nbsp;&nbsp;3.1 Definition

Material non-public information is any information (positive or negative) that:

● is not generally known to the public, and

● which, if publicly known, would likely affect either the market price of the Company's securities or a person's decision to buy, sell or hold the Company's securities.

 

<sup>1</sup> If contractors have access to material non-public information in the course of their activities for the Company, the Company's agreements with them should include a covenant that they will comply with the Company's insider trading policy.

<sup>2</sup> In order to incur liability for "tipping," the tipper must (1) know or have reason to know that the information may be used in order to trade, and (2) derive some benefit from providing the information to the tippee. In order to incur liability for trading on a tip, the tippee must know or have reason to know that the information was provided in violation of a duty of trust or confidence. See, e.g., SEC v. Musella, 678 F. Supp. 1060, 1063 (S.D.N.Y. 1988).

<sup>3</sup> "Control person" liability extends to the company and to officers and directors who are part of a "control group" with regard to (1) the company itself or (2) an employee who engages in insider trading, and who "in some meaningful sense are culpable participants in the fraud." Lanza v. Drexel & Co., 479 F.2d 1277, 1299 (2d Cir. 1973).

&nbsp;&nbsp;&nbsp;&nbsp;3.2 Examples

Common examples of information that will frequently be regarded as material include, but are not limited to:

● Quarterly or annual earnings results;

● Projections of future financial results;

● Earnings or losses;

● News of a pending or proposed merger, acquisition or tender offer;

● News of a pending or proposed acquisition or disposition of a significant asset;

● News of a pending or proposed joint venture;

● A company restructuring;

● Significant transactions with officers, directors or greater than 5% shareholders;

● Financing transactions;

● Changes in dividend policies, the declaration of a stock split or the offering of additional securities;

● Establishment of a stock repurchase program;

● Changes in pricing or cost structure of Company products or services;

● Changes in management;

● Changes in auditors or notification that the auditor's reports may no longer be relied upon;

● Significant new products or discoveries;

● Significant clinical or regulatory developments;

● Pending or threatened significant litigation, or the resolution of such litigation;

● Impending bankruptcy or financial liquidity problems;

● Internal financial information which departs from what the market expects;

● The gain or loss of a significant customer or supplier, major contract, license, registration or collaboration;

● The entry, amendment or termination of a material contract; or

● Other items that require the filing of a Current Report on Form 8-K with the SEC.

&nbsp;&nbsp;&nbsp;&nbsp;3.3 Twenty-Twenty
 Hindsight

In determining whether information is material, the SEC and other regulators will view the information after-the-fact with the benefit of hindsight. As a result, in determining whether any information is material, we will and you should carefully consider whether regulators and others might view the information as being material in hindsight, with the benefit of all relevant information that later becomes available. For example, if there is a significant change in the Company's stock price following release of certain information, that information will likely be determined to have been material when viewed with the benefit of hindsight.

In addition to addressing the relevant statutes and regulations in this area, we are adopting this Policy to avoid even the appearance of improper conduct on the part of anyone employed by or associated with the Company and certain related persons, not just members of senior management.

4 The Consequences of Insider Trading

The consequences of insider trading violations can be severe:

<u>For individuals</u> who trade while in possession of material non-public information (or tip information to others):

● A civil penalty of up to three times the profit gained, or loss avoided;

● A criminal fine (no matter how small the profit) of up to $5 million; and

● A jail term of up to 20 years.

These penalties can apply even if the individual is not a member of the Board of Directors or an officer of the Company. Moreover, if an employee violates this Policy, he or she may also be subject to Company-imposed sanctions, including termination for cause.

<u>For a Company</u> (as well as possibly any supervisory person) that fails to take appropriate steps to prevent illegal trading:

● A civil penalty of the greater of $1 million or three times the profit gained, or loss avoided as a result of the employee's violation; and

● A criminal penalty of up to $25 million.

Any of the above consequences, including an SEC investigation that does not result in prosecution, can tarnish the Company's or an individual's reputation and irreparably damage a career.

5 Our Policy

&nbsp;&nbsp;&nbsp;&nbsp;5.1 General
 Prohibition on Trading

Company personnel and Related Persons (as defined below in this Section 5.2)<sup>4</sup> may not buy or sell securities of the Company while in possession of material non-public information or engage in any other action to take advantage of, or pass on to others, that information, subject to the specific exceptions noted below in Section 5.9 "Exceptions for Certain Transactions."

<sup>4</sup> "Related persons" can include companies or entities affiliated with or otherwise controlled by the corporate insider. Note, however, this Policy does not include all family members related by blood.

&nbsp;&nbsp;&nbsp;&nbsp;5.2 Transactions
 by Family Members, Others in Your Household and Entities You Control

The restrictions in this Policy also apply to (1) immediate family members who reside with you, (2) others living in your household (whether or not related to you), (3) family members who do not live in your household but whose transactions in the Company's securities are directed by you or are subject to your influence or control (e.g., parents or children who consult with you before they trade in the Company's securities) and (4) any entities that you influence or control, including any corporations, limited liability companies, partnerships or trusts (each person or entity identified in clauses (1) – (4), a "Related Person"). SEC regulations specifically provide that any material non-public information about the Company communicated to any spouse, parent, child or sibling is considered to have been communicated under a duty of trust or confidence; and that any trading in the Company's securities by such family members while they are aware of such information may, therefore, violate insider trading laws and regulations. Company personnel are expected to be responsible for the compliance of all Related Persons with this Policy. This means that, to the extent such Related Persons of Company personnel intend to trade in the Company's securities, the Related Persons need to comply with the black-out periods and all other restrictions in this Policy. Furthermore, you should not participate in any investment club (i.e., groups of people who pool their money to make investments) that may invest in the Company's securities.

&nbsp;&nbsp;&nbsp;&nbsp;5.3 Other
 Companies' Non-public Information

This Policy also applies with equal force to information relating to any other company, including our customers or suppliers, obtained by Company personnel during the course of their service to, or employment by, the Company. Specifically, no Company personnel who, in the course of work on behalf of the Company, learns of material non-public information about a company with which the Company does business may trade in the other company's securities until the information becomes public or is no longer material.

&nbsp;&nbsp;&nbsp;&nbsp;5.4 Personal
 or Independent Reasons Are Not Exceptions

Transactions in the Company's securities that may be necessary or justifiable for independent reasons (such as the need to raise money for an emergency expenditure) are no exception. Even the appearance of an improper transaction must be avoided to preserve our reputation for adhering to the highest standards of conduct.

&nbsp;&nbsp;&nbsp;&nbsp;5.5 Policy
 Administrator

This Policy shall be administered by the "Policy Administrator," who shall initially be the Company's Chief Financial Officer, and if such person is not available, then the Company's Principal Financial Officer, shall serve as the alternate Policy Administrator. The Policy Administrator may, however, change from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;5.6 When
 Information Becomes Public

This Policy applies to material non-public information about the Company and about any other company as discussed in section 5.3, which means that trading is permitted once the information becomes known to the public (unless some other Company policy or legal obligation restricts trading at that time). Because the Company's shareholders and the investing public should be afforded time to receive and absorb information, as a general rule you should not engage in any transactions until the beginning of the second business day after material information has been released. Thus, if an announcement is made before the market opens on a Monday, then Wednesday generally would be the first day on which you may trade. If an announcement is made before the market opens on a Friday, then Tuesday generally would be the first day on which you may trade. However, if the information released is complex, such as a major financing or other significant transaction, it may be necessary to allow additional time for the information to be absorbed by the investing public. In addition, we have established specified black-out periods, as described below.

&nbsp;&nbsp;&nbsp;&nbsp;5.7 Pre-Clearance
 of Trades by All Personnel

In order to ensure compliance with this Policy and with any Section 16 reporting requirements, all transactions in the Company's securities (including acquisitions, sales, gifts and other transfers, whether or not for value)<sup>5</sup>, including the execution of Trading Plans (as defined below), by members of the Company's Board of Directors, Senior Management, Financial Team Members, Designated Employees and Related Persons, must be pre-cleared by the Policy Administrator. If you are a member of one of the groups listed above and you contemplate a transaction in the Company's securities, you must contact the Policy Administrator or other designated individual prior to executing the transaction. The Policy Administrator will use his or her reasonable best efforts to provide approval or disapproval within two business days. You must wait until receiving pre-clearance to execute the transaction. Neither the Company nor the Policy Administrator shall be liable for any delays that may occur due to the pre-clearance process. If the transaction is pre-cleared by the Policy Administrator, it must be executed by the end of the second business day after receipt of pre-clearance. Notwithstanding receipt of pre-clearance of a transaction, if you become aware of material non-public information about the Company after receiving the pre-clearance but prior to the execution of the transaction, you may not execute the transaction. The responsibility for determining whether you are in possession of material non-public information rests with you, as discussed below in Section 6. If you are a Section 16 reporting person, promptly following execution of the transaction, but in no event later than the end of the first business day after the execution of the transaction, you must notify the Policy Administrator and provide details regarding the transaction sufficient to complete the required Section 16 filing.

Please note that pre-clearance does not provide Company personnel with immunity from investigation or suit, for which it is the responsibility of the individual to comply with the federal securities regulations.

The following members of management constitute the "Senior Management" of the Company: all Executive (Section 16) Officers, as listed on Exhibit A hereto, which list shall be amended from time to time to reflect the then-current group of such individuals.

The following individual constitute the "Financial Team Members" of the Company: all members of the Company's financial team, as listed on Exhibit B hereto, which list shall be amended from time to time to reflect the then-current group of such individuals.

The following individuals constitute other "Designated Employees" of the Company: certain additional members of Company personnel, as listed on Exhibit C hereto, which list shall be amended from time to time to reflect the then-current group of such individuals.

The Policy Administrator may, from time to time, amend the list of and/or designate other employees as Senior Management, Financial Team Members or Designated Employees, in which case the Policy Administrator shall notify the affected individuals.

&nbsp;&nbsp;&nbsp;&nbsp;5.8 Prohibited
 Trading Periods

While it is never permissible to trade based on material non-public information, we are implementing the following procedures to help prevent inadvertent violations of this Policy and avoid even the appearance of an improper transaction (which could result, for example, where Company personnel engage in a trade while unaware of a *pending major development*). Therefore, in addition to all Company personnel being subject to the pre-clearance process described above, certain Company personnel are also subject to additional trading procedures and restrictions, which are set forth below.

<sup>5</sup> Note here that gifts or other transfers of Company securities require pre-approval from the Policy Administrator, even though they may not be explicitly covered transactions under other portions of the Policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.8.1 Company
 Wide Black-Out Periods Applicable to All Company Personnel

All Company personnel and Related Persons are prohibited from trading in any of the Company's securities during the following periods:

● From the time each such individual becomes aware of the material information (the black-out start times often vary), until the beginning of the second business day after the day the Company has made a public announcement of material information, including earnings releases, unless the information released is complex, in which case it may be necessary to extend this period; and

● During other specified periods when significant developments or announcements are anticipated.

● The periods from 14 days 2 weeks prior to the close of each fiscal quarter until the beginning of the second business day after the release of the Company's financial results for each quarter and, in the case of the fourth quarter, financial results for the year end; and

● Any other periods as determined by the Company.

It should also be noted that even during periods when trading is permitted, no one, including persons or entities who do not fall within the definition of Related Persons, should trade in the Company's securities if he or she possess material non-public information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.8.2 For
 the avoidance of doubt, the black-out period restrictions set forth in this Section 5.8 apply to all transactions involving the Company's
 securities, including trading on the open-market.

&nbsp;&nbsp;&nbsp;&nbsp;5.9 Exceptions
 for Certain Transactions

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9.1 Gifts

Bona fide gifts are not transactions that are subject to this Policy, unless the person making the gift (the donor) has reason to believe that the recipient of the gift intends to sell the Company's securities while the donor is in possession of material non-public information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9.2 Mutual
 Funds

Transactions in mutual funds that are invested in the Company's securities are not transactions subject to this Policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9.3 Transactions
 Involving Company Equity Plans

Except as set forth in Section 5.8 and otherwise noted below, this Policy does not apply to the following transactions:

● Stock Option Exercises. This Policy does not apply to the exercise of an employee stock option acquired pursuant to the Company's equity plans, or to the exercise of a tax withholding right pursuant to which a person has elected to have the Company withhold shares subject to an option to satisfy tax withholding requirements. This Policy does apply, however, to any sale of stock as part of a broker-assisted cashless exercise of an option, any market sale of stock for the purpose of generating the cash needed to pay the exercise price and or taxes upon the exercise of an option or simply the sale of company stock received upon the exercise of an employee stock option regardless of the reason for exercise and sale.

● Restricted Stock Awards and Restricted Stock Unit Awards. This Policy does not apply to the vesting of restricted stock or restricted stock units, or the exercise of a tax withholding right pursuant to which a person elects to have the Company withhold shares of stock to satisfy tax withholding requirements upon the vesting of any restricted stock or restricted stock unit. This Policy does apply, however, to any market sale of restricted stock or shares received upon vesting of restricted stock units.

● Employee Stock Purchase Plan. This Policy does not apply to purchases of the Company's securities under the Company's employee stock purchase plan. This Policy does apply, however, to subsequent sales or other transfers of such securities.

● Other Transactions with the Company. Any other purchase of the Company's securities from the Company or sales of the Company's securities to the Company are not subject to this Policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9.4 Rule
 10b5-1 Trading Plans

Notwithstanding the restrictions and prohibitions on trading in the Company's securities set forth in this Policy, persons subject to this Policy are permitted to effect transactions in the Company's securities pursuant to approved trading plans established under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended ("Trading Plans"), which may include transactions during the prohibited periods discussed above. Rule 10b5-1 requires that these transactions be made pursuant to a plan that was established while the person was not in possession of material non-public information, and the SEC requires that these plans not be entered into during any applicable Company-imposed black-out period. In order to comply with this Policy, the Company must pre-approve any such Trading Plan prior to its effectiveness. After a Trading Plan is approved, you must wait for a cooling-off period before the first trade is made under the Trading Plan, the length of which will be determined by the Policy Administrator. Once the Trading Plan is adopted, you must not exercise any influence over the amount of securities to be traded, the price at which they are to be traded or the dates of the trades. The Trading Plan must either specify the amount, pricing and timing of transactions in advance or delegate discretion on these matters to an independent third party. Any modification of a Trading Plan is the equivalent of entering into a new Trading Plan and cancelling the old Trading Plan. Company personnel seeking to establish, modify or cancel a Trading Plan should contact the Policy Administrator.

6 Individual Responsibility

Persons subject to this Policy have ethical and legal obligations to maintain the confidentiality of information about the Company and to not engage in transactions in the Company's securities while in possession of material non-public information. Each individual is responsible for making sure that he or she complies with this Policy, and that any Related Person, whose transactions are subject to this Policy, also comply with this Policy. In all cases, the responsibility for determining whether an individual is in possession of material non-public information rests with that individual, and any action on the part of the Company, the Policy Administrator or any other employee or director pursuant to this Policy (or otherwise) does not in any way constitute legal advice or insulate an individual from liability under applicable securities laws. You may be subject to legal penalties and disciplinary action by law enforcement officials and/or the Company for any conduct prohibited by this Policy or applicable securities laws, as described in Section 4 above.

&nbsp;&nbsp;&nbsp;&nbsp;6.1 Tipping
 Information to Others

Company personnel must not disclose non-public information about the Company to others outside the Company who do not have an obligation to maintain the confidentiality of such information. If the outsider trades on such information, penalties for insider trading may apply in these situations whether or not you derive any monetary benefit from the other person's trading activities.<sup>6</sup> Material non-public information is often inadvertently disclosed or overheard in casual, social conversations. Please take care to avoid such disclosures.

<sup>6</sup> While some benefit must be incurred, it need not be monetary.

&nbsp;&nbsp;&nbsp;&nbsp;6.2 Prevention
 of Insider Trading by Others

If you become aware of a potential insider trading violation, you must immediately advise our Policy Administrator and/or report the matter using the Company's anonymous whistleblower reporting procedures. You should also take steps, where appropriate, to prevent persons under your supervision and/or control from using material non-public information for trading purposes. Moreover, Company-imposed sanctions, including termination for cause, could result if an employee fails to comply with this Policy.

&nbsp;&nbsp;&nbsp;&nbsp;6.3 Confidentiality

Serious problems could be caused for the Company by the unauthorized disclosure of internal information about the Company, whether or not for the purpose of facilitating improper trading in the Company's securities. Company personnel should not discuss internal Company matters or developments (whether or not you think such information is material) with anyone outside of the Company (including, but not limited to, family, friends, business associates, investors and expert consulting firms), except as required in the performance of regular corporate duties. This prohibition applies specifically (but not exclusively) to inquiries about the Company that may be made by the financial press, investment analysts or others in the financial community and also includes posting material non-public information on any social media outlets such as Facebook, Twitter, etc. It is important that all such communications on behalf of the Company be made only through an authorized officer under carefully controlled circumstances. Unless you are expressly authorized to the contrary, if you receive any inquiries of this nature, you should decline comment and refer the inquirer to a designated communications officer. Please review the Company's separate Regulation FD Policy, which governs all public communications with people outside the Company.

7 Additional Prohibited Transactions

Because we believe it is generally improper and inappropriate for Company personnel to engage in short-term or speculative transactions involving the Company's securities, it is our policy that Company personnel and Related Persons not engage in any of the following activities, except in each case in limited circumstances with prior approval of the Policy Administrator:

● Trading in the Company's securities on a short-term basis. Any shares of Company common stock purchased in the open market must be held for a minimum of six months and ideally longer;

● Short sales of the Company's securities;

● Use of the Company's securities to secure a margin or other loan;

● Transactions in straddles, collars or other similar risk reduction or hedging devices; and

● Transactions in publicly-traded options relating to the Company's securities (i.e., options that are not granted by the Company).

8 Post-Termination Transactions

This Policy will no longer apply after termination of service to the Company. However, if an individual is in possession of material non-public information when his or her service terminates, that individual may not trade in the Company's securities until that information has become public or is no longer material, and it would be prudent for the individual, if he or she is subject to a black-out period upon termination of service, to refrain from trading until those restrictions no longer apply to Company personnel.

9 Company Assistance

Any person who has any questions about specific transactions or this Policy in general may obtain additional guidance from the Policy Administrator. Remember, however, the ultimate responsibility for adhering to this Policy and avoiding improper transactions rests with you. In this regard, please use your best judgment when considering a transaction in the Company's securities.

10 Certifications

As a condition to employment, all employees will be required to certify their understanding of and intent to comply with this Policy. Members of the Board of Directors, Senior Management and other personnel may be required to certify compliance on an annual basis.

11 Appendix

Exhibit A

"Senior Management"

Exhibit B

"Financial Team Members"

Exhibit C

"Designated Employees"

Exhibit D

"Black-out periods"

## Exhibit 23.1

**Exhibit 23.1**

<u>CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</u>

We consent to the incorporation by reference in the Registration Statement on Form S-1 (File Nos. 333-223630, 333-230670, 333-239431, and 333-230395, and the related registration statement (File No. 333-230714) filed under Rule 462(b)), Forms S-3 (File Nos. 333-242341 and 333-279491) and Forms S-8 (File Nos. 333-263957, 333-195737, 333-205752, 333-207002, 333-212547, 333-216628, 333-225627, 333-231935, and 333-252439) of our report dated February 26, 2026, with respect to the consolidated financial statements of Pulmatrix, Inc. included in this Annual Report on Form 10-K for the year ended December 31, 2025.

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| |
|:---|
| */s/ CBIZ CPAs P.C.* |
| CBIZ CPAs P.C. |
| New York, NY |
| February 26, 2026 |

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## Exhibit 23.2

**Exhibit 23.2**

<u>CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</u>

We consent to the incorporation by reference in the Registration Statement(s) on Form S-1 (File Nos. 333-223630, 333-230670, 333-239431, and 333-230395, and the related registration statement (File No. 333-230714) filed under Rule 462(b)), Forms S-3 (File Nos. 333-242341 and 333-279491) and Forms S-8 (File Nos. 333-263957, 333-195737, 333-205752, 333-207002, 333-212547, 333-216628, 333-225627, 333-231935, and 333-252439) of our report dated March 21, 2025, with respect to the consolidated financial statements of Pulmatrix, Inc. included in this Annual Report on Form 10-K for the year ended December 31, 2025.

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| |
|:---|
| */s/ Marcum LLP* |
| Marcum LLP |
| New York, NY |
| February 26, 2026 |

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## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION PURSUANT TO**

**SECURITIES EXCHANGE ACT RULES 13a-14 and 15d-14**

**AS ADOPTED PURSUANT TO**

**SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Peter Ludlum, Interim Chief Executive Officer and Interim Chief Financial Officer, certify that:

1. I have reviewed this Annual Report on Form 10-K of Pulmatrix, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

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| |
|:---|
| Date: February 26, 2026 |
| */s/ Peter Ludlum* |
| Peter Ludlum |
| Interim Chief Executive Officer and Interim Chief Financial Officer |
| (Principal Executive, Financial and Accounting Officer) |

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## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION PURSUANT TO**

**18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Annual Report on Form 10-K of Pulmatrix, Inc. (the "Company") for the period ended December 31, 2025 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, the undersigned, Peter Ludlum, as the Interim Chief Executive Officer and Interim Chief Financial Officer of the Company, do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

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| |
|:---|
| Date: February 26, 2026 |
| */s/ Peter Ludlum* |
| Peter Ludlum |
| Interim Chief Executive Officer and Interim Chief Financial Officer |
| (Principal Executive, Financial and Accounting Officer) |

---

The foregoing certification is being furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) and is not being filed as part of the Form 10-K or as a separate disclosure document.