MATEON THERAPEUTICS, INC. (OTCMKTS:MATN) Files An 8-K Entry into a Material Definitive Agreement

MATEON THERAPEUTICS, INC. (OTCMKTS:MATN) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01

Fall 2019 Debt Financing

On November 23, 2019, the Company entered into a Note Purchase Agreement (the “Note Purchase Agreement”) with certain accredited investors, including Dr. Vuong Trieu, the Company’s Chairman and Chief Executive Officer. Under the terms of the Note Purchase Agreement, the Company proposes to issue up to $1,500,0000 in face amount of convertible promissory notes (the “Notes”).

The Company completed the initial closing under the Note Purchase Agreement on November 23, 2019, issuing a $250,000 principal amount Note to each of Dr. Vuong Trieu and Stephen Boesch, in exchange for gross proceeds of $500,000. Mr. Boesch is the VP of AI Technology for PointR Data, Inc., the wholly owned subsidiary of the Company.

The Notes provide for interest at the rate of 5% per annum, and are unsecured. All amounts outstanding under the Notes becomes due and payable upon the approval of the holders of a majority of the principal amount of outstanding Notes (the “Majority Holders”) on or after (a) [November 23, 2020] or (b) the occurrence of an event of default (either, the “Maturity Date”). The Company may prepay the Notes at any time. Events of default under the Notes include failure to make payments under the Notes within thirty (30) days of the date due, failure to observe of the Note Purchase Agreement or Notes which is not cured within thirty (30) days of notice of the breach, bankruptcy, or a change in control of the Company (as defined in the Note Purchase Agreement).

The Majority Holders have the right, at any time not more than five (5) days following the Maturity Date, to elect to convert all, and not less than all, of the outstanding accrued and unpaid interest and principal on the Notes. The Notes may be converted, at the election of the Majority Holders, either (a) into shares of the Company’s Common Stock at a conversion price of $0.18 per share, or (b) into shares of EdgePoint’s, the Company’s to be newly formed subsidiary for AI/Blockchain in pharmaceutical manufacturing, common stock at a conversion price of $5.00 (based on a $5 million pre-money valuation) of EdgePoint and 1 million shares outstanding.

The information in Item 1.01 is incorporated by reference herein.

In connection with the initial closing under the Note Purchase Agreement, the Company issued two Notes in the amount of $250,000 each to Dr. Vuong Trieu and Stephen Boesch, each of which are accredited investors.