GUIDED THERAPEUTICS, INC. (OTCBB:GTHPD) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01
| Entry Into a Material Definitive Agreement |
On February 13, 2017, Guided Therapeutics, Inc. (the Company)
entered into a securities purchase agreement with Auctus Fund,
LLC for the issuance and sale to Auctus of $170,000 in aggregate
principal amount of a 12% convertible promissory note for an
aggregate purchase price of $156,400 (representing a $13,600
original issue discount). On February 13, 2017, the Company
issued the note to Auctus. to the purchase agreement, the Company
also issued to Auctus a warrant exercisable to purchase an
aggregate of 200,000 shares of the Companys common stock.
to the purchase agreement, Auctus may not engage in any short
sale transactions of the Companys common stock.
The purchase agreement contains customary representations,
warranties and covenants by, among and for the benefit of the
parties. The purchase agreement also provides for customary
indemnification of Auctus by the Company.
The warrant is exercisable at any time, at an exercise price per
share equal to $0.77 (110% of the closing price of the common
stock on the day prior to issuance), subject to certain customary
adjustments and price-protection provisions contained in the
warrant. The warrant has a five-year term.
The note matures nine months from the date of issuance and, in
addition to the original issue discount, accrues interest at a
rate of 12% per year. The Company may prepay the note, in whole
or in part, for 115% of outstanding principal and interest until
30 days from issuance, for 125% of outstanding principal and
interest at any time from 31 to 60 days from issuance, and for
130% of outstanding principal and interest at any time from 61
days from issuance to 180 days from issuance.
After six months from the date of issuance, Auctus may convert
the note, at any time, in whole or in part, into shares of the
Companys common stock, at a conversion price equal to the lower
of the price offered in the Companys next public offering or a
40% discount to the average of the two lowest trading prices of
the common stock during the 20 trading days prior to the
conversion, subject to certain customary adjustments and
price-protection provisions contained in the note.
The note includes customary events of default provisions and a
default interest rate of 24% per year. Upon the occurrence of an
event of default, Auctus may require the Company to redeem the
note (or convert it into shares of common stock) at 150% of the
outstanding principal balance plus accrued and unpaid interest.
In connection with the transaction, the Company agreed to
reimburse Auctus for $30,000 in legal and diligence fees, of
which the Company paid $10,000 in cash and $20,000 in restricted
shares of common stock, valued at $0.40 per share (a 42.86%
discount to the closing price of the common stock on the day
prior to issuance).
The Company used a placement agent in connection with the
transaction. For its services, the placement agent received a
cash placement fee equal to 10% of the net proceeds from the
transaction.
The issuance of the note, the warrant and the shares of common
stock under the purchase agreement was exempt from the
registration requirements of the Securities Act, to the exemption
for transactions by an issuer not involving any public offering
under Section 4(a)(2) of the Securities Act of 1933, as amended
(the Securities Act). In making this determination, the Company
relied on the representations of Auctus in the purchase agreement
that it is an accredited investor and had access to information
about its investment and about the Company. Should the note and
warrant be converted into shares of common stock, the issuance of
the shares of common stock would be exempt from the registration
requirements of the Securities Act to the exemption for exchange
transactions under Section 3(a)(9) of the Securities Act.
The descriptions of the of the purchase agreement, the note and
the warrant do not purport to be complete and are qualified in
their entirety by the full text of each, attached as Exhibits
10.1 and 4.1 and 4.2, respectively, and incorporated herein by
reference.
This current report on Form 8-K is neither an offer to sell nor
the solicitation of an offer to buy any securities. The
securities described above have not been registered under the
Securities Act and may not be offered or sold in the United
States absent registration or an exemption from registration
under the Securities Act.
| Item 2.03 |
Creation of Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant |
The information set forth in Item 1.01 is incorporated herein by
reference.
| Item 3.02 | Unregistered Sale of Equity Securities |
The information set forth in Item 1.01 is incorporated herein by
reference.
| Item 9.01 | Financial Statements and Exhibits |
(d) Exhibits.
| Number | Exhibit | |
| 4.1 | Convertible Note | |
| 4.2 | Warrant | |
| 10.1 |
Purchase Agreement, dated February 13, 2017, by and between the Company and Auctus Fund, LLC |
About GUIDED THERAPEUTICS, INC. (OTCBB:GTHPD)
Guided Therapeutics, Inc. is a medical technology company. The Company is focused on developing medical devices. The Company’s primary focus is the sales and marketing of its LuViva Advanced Cervical Scan non-invasive cervical cancer detection device and extension of its cancer detection technology into other cancers, including esophageal. The Company’s technology of LuViva primarily relates to the use of biophotonics for the non-invasive detection of cancers. The Company focuses on two primary applications for LuViva: first, as a cancer screening tool and second, as a triage. Its product, in addition to detecting the structural changes attributed to cervical cancer, is also detects the biochemical changes that precede the development of visual lesions. LuViva consists of three components: Touch screen monitor, Hand Held Unit (HHU) and the Wheeled Base. GUIDED THERAPEUTICS, INC. (OTCBB:GTHPD) Recent Trading Information
GUIDED THERAPEUTICS, INC. (OTCBB:GTHPD) closed its last trading session 00.0000 at 0.0000 with 54,019,175 shares trading hands.