Femasys Inc. Completes ~$30M Private Placement; Issues Warrants

What Happened

• Femasys Inc. (FEMY) announced the closing of a private placement on August 10, 2026, expected to yield approximately $30.0 million in gross proceeds. The company issued 5,013,559 shares of common stock, pre‑funded warrants exercisable into up to 4,361,440 shares, and two types of accompanying warrants (common and milestone) covering an aggregate of 18,749,998 shares. Five company insiders (including the CEO and CFO) participated for about $134,000 on the same terms as other investors. The company also agreed to file a resale registration statement covering 100% of the shares issuable upon exercise of the warrants within 30 days of closing.

Key Details

• Common stock issued: 5,013,559 shares; purchase price per share: $3.20.
• Pre‑Funded Warrants: exercisable for $0.0001 per share; purchase price $3.1999 each; up to 4,361,440 shares.
• Warrants issued: total 18,749,998 (9,374,999 Common Warrants immediately exercisable; 9,374,999 Milestone Warrants exercisable only if both (i) U.S. revenue ≥ $1,500,000 in any fiscal quarter and (ii) VWAP ≥ 130% of exercise price for 20 of 30 consecutive trading days). Exercise price for Common and Milestone Warrants: $2.95; term: 3 years.
• Ownership cap on exercise: prevents beneficial ownership >4.99% (or 9.99% if elected) immediately following exercise; adjustable with 61 days’ notice.
• Side Letter with Lead Investor (Nantahala Capital) grants rights to designate up to two board designees (and a non-voting observer if thresholds met); board representation rights terminate after 10 years.
• Registration Rights Agreement: company to file a resale registration statement within 30 days and use commercially reasonable efforts to have it declared effective.

Why It Matters

• This transaction provides Femasys with near-term capital (~$30M) to support operations or development plans, reducing immediate cash pressure.
• It also creates potential future dilution: large warrant pools and pre‑funded warrants can convert into common shares if exercised, and milestone warrants add contingent dilution tied to revenue and stock performance.
• The Lead Investor’s board designation rights could influence governance and strategy while the registration agreement enables public resale of the warrant‑issued shares once effective. Retail investors should weigh the improved cash position against potential dilution and new investor influence on the board.