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EX-4.1 - EXHIBIT 4.1 - Skyline Medical Inc.v332113_ex4-1.htm
EX-10.1 - EXHIBIT 10.1 - Skyline Medical Inc.v332113_ex10-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported):  January 15, 2013 (January 14, 2013)

 

BioDrain Medical, Inc.

(Exact name of Registrant as Specified in its Charter)

 

Minnesota

(State or Other Jurisdiction of Incorporation)

 

333-155299 33-1007393
(Commission File Number) (IRS Employer Identification No.)

 

2915 Commers Drive, Suite 900

Eagan, MN  55121

(Address of Principal Executive Offices and Zip Code)

 

(651) 389-4800

(Registrant’s telephone number, including area code)

 

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

           

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 
 

 

Item 1.01 Entry into a Material Definitive Agreement.

 

The information included in Item 2.03 below is incorporated into this Item 1.01 by this reference.

 

Item 2.03.   Creation of a Direct Financial Obligation or an Obligation under an Off Balance Sheet Arrangement of a Registrant. 

 

As of January 14, 2013, BioDrain Medical, Inc. (the "Company"), issued to four (4) accredited investors (each a "Holder" and collectively, the “Holders”) (1) 8% convertible 1-year promissory notes (each a “Note” and collectively, the “Notes”) in an aggregate principal amount equal to $300,000 and (2) warrants (each a “Warrant” and collectively, the “Warrants”) to purchase 2,500,000 shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”) for an aggregate purchase price of $300,000, pursuant to the terms and conditions of those certain Subscription Agreements (the "Subscription Agreements").

 

The Notes accrue simple interest at a rate of 8% per annum and are due and payable on the one-year anniversary of the issue date of the Notes. At the option of the Holder, any time prior to a Qualified Transaction (as defined below) until the repayment of the entire principal amount and accrued interest due under such Note (the "Conversion Amount"), the Holder shall have the option to convert any or all of the Conversion Amount into Common Stock at a conversion price equal to $0.12 per share, subject to proportionate adjustment as provided in the Notes (the “Elective Conversion Price”). Upon the consummation of a Qualified Financing until the repayment of the Conversion Amount, each Holder shall have the option to convert any or all of the Conversion Amount into Common Stock, at a conversion price equal to the lesser of 75% of the lowest price per share at which shares of the Company’s Common Stock (or other equity securities of the Company, on an as converted basis) are sold in an equity financing or series of related equity financings by the Company occurring after the issue date of the Notes (not including any sale of Notes in the Offering) which results in aggregate gross proceeds to the Company of at least $2,000,000 (a “Qualified Financing”) or the Elective Conversion Price (subject to proportionate adjustment).

 

The occurrence of any one of the following events will be deemed an event of default: (i) the failure of the Company to pay the principal balance or accrued interest on the Notes when due; (ii) failure by the Company or the Company’s transfer agent to issue securities issuable upon conversion of a Note to the Holder of such Note within thirty (30) calendar days after the receipt of a Conversion Notice (as defined in the Notes) and surrender by a Holder of a Note to the Company or the Company’s transfer agent; (iii) the consent or institution by or against the Company of bankruptcy or insolvency proceedings or the filing, or consent by the Company for the filing of a petition or answer or consent seeking reorganization or release under the federal Bankruptcy Act, or any other applicable federal or state law, or the appointment of a receiver, liquidator, assignee, trustee or other similar official of the Company, or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the taking of corporate action by the Company in furtherance of any such action; (iv) the commencement of an action against the Company seeking any bankruptcy, insolvency, reorganization, liquidation, dissolution or similar relief that has not been resolved in favor of the Company or vacated within 60 days; or (v) any material breach by the Company of any covenant, warranty, representation or other term or condition of the Notes or the Subscription Agreement which is not cured within the time periods permitted therein or, if no cure period is provided therein, within sixty (60) days after the date on which the Company receives written notice of such breach.

 

The Warrants are exercisable at an exercise price of $0.15 per share any time after the issue date of the Notes until 5:00 p.m. EST on the fifth anniversary of the issue date.

 

The description of the Notes and Warrants included in this Item 2.03 is qualified in its entirety by the terms and conditions of the form of the Notes filed as Exhibit 10.1, and the Warrants filed as Exhibit 4.1, to this Current Report on Form 8-K.

 

Item 3.02 

Unregistered Sales of Equity Securities.

 

The information set forth in Item 2.03 above is incorporated herein by this reference. The Company paid cash commissions equal to an aggregate of $24,000 and agreed to issue warrants (the "Placement Agent Warrant") to purchase an aggregate of 200,000 shares of Common Stock to the placement agent in connection with the sale of the Notes and Warrants. The Placement Agent Warrant has terms that are substantially similar to the terms and conditions of the Warrant. The securities described herein were issued pursuant to the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”) and Regulation D promulgated thereunder, in that the sale and purchase of such securities did not involve any public offering and the Company obtained representations from each investor that it was an “accredited investor” as that term is defined under Rule 501 of Regulation D. As of the date of this filing, there are 104,610,194 shares of Common Stock of the Company issued and outstanding.

 

 
 

 

Item 9.01. Exhibits and Financial Statements

 

(d)      Exhibits

 

4.1      Form of Warrant

10.1    Form of Convertible Promissory Note

  

 
 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: January 15, 2013

 

  BIODRAIN MEDICAL, INC.  
       
  By: /s/ Josh Kornberg  
    Josh Kornberg
    President and Chief Executive Officer