Attached files
Exhibit 3.4
Delaware
The
First State
I, JEFFREY W. BULLOCK, SECRETARY OF STATE OF THE STATE OF DELAWARE,
DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE
CERTIFICATE OF DESIGNATION OF “GUIDED THERAPEUTICS,
INC.”, FILED IN THIS OFFICE ON THE THIRTY-FIRST DAY OF MARCH,
A.D. 2020, AT 12:50 O`CLOCK P.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW
CASTLE COUNTY RECORDER OF DEEDS.
/s/ Jeffrey W. Bullock
Jeffrey W. Bullock, Secretary of State
2313878
8100
|
Authentication:
202694178
|
SR#
20202489602
|
Date:
04-01-20
|
You may
verify this certificate online at
corp.delaware.gov/authver.shtml
1
State
of Delaware Secretary
of State
Division
of Corporations
Delivered
12:50PM
03/31/2020
FILED
12:50PM
03/3ln020
SR 20202489602 - File Number 2313878 |
|
GUIDED THERAPEUTICS, INC.
CERTIFICATE OF DESIGNATION OF PREFERENCES, RIGHTS AND
LIMITATIONS
OF
SERIES D CONVERTIBLE PREFERRED STOCK
PURSUANT
TO SECTION 151 OF THE DELAWARE GENERAL CORPORATION LAW
The
undersigned, Gene S. Cartwright does hereby certify
that:
1.
He is the President, Chief Executive Officer, and
acting Chief Financial Officer of Guided Therapeutics, Inc., a
Delaware corporation (the "Corporation").
2.
The
Corporation is authorized to issue 5 million shares of preferred
stock.
3.
The following resolutions were duly adopted by the
board of directors of the Corporation (the "Board of
Directors"):
WHEREAS, the certificate of incorporation of the
Corporation provides for a class of its authorized stock known as
preferred stock, consisting of 5
million shares, $0.001 par value per
share, issuable from time to time in one or more
series;
WHEREAS,
the Board of Directors is authorized to fix the dividend rights,
dividend rate, voting rights, conversion rights, rights and terms
of redemption and liquidation preferences of any wholly unissued
series of preferred stock and the number of shares constituting any
series and the designation thereof, of any of them;
and
WHEREAS,
it is the desire of the Board of Directors, pursuant to its
authority as aforesaid, to fix the rights, preferences,
restrictions and other matters relating to a series of the
preferred stock, which shall consist of, except as otherwise set
forth in the Purchase Agreement, up to 6,000 shares of the
preferred stock which the Corporation has the authority to issue,
as follows:
NOW,
THEREFORE, BE IT RESOLVED, that the Board of Directors does hereby
provide for the issuance of a series of preferred stock for cash or
exchange of other securities, rights or property and does hereby
fix and determine the rights, preferences, restrictions and other
matters relating to such series of preferred stock as
follows:
2
TERMS OF PREFERRED STOCK
Section
1. Definitions.
For the purposes hereof, the following terms shall have the
following meanings:
"Affiliate"
means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed
under Rule 405 of the Securities Act.
"Bankruptcy
Event" means any of the
following events: (a) the Corporation or any Significant Subsidiary
(as such term is defined in Rule 1-02(w) of Regulation S-X under
the U.S. securities laws) thereof commences a case or other
proceeding under any bankruptcy, reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction relating to the
Corporation or any Significant Subsidiary thereof, (b) there is
commenced against the Corporation or any Significant Subsidiary
thereof any such case or proceeding that is not dismissed within 60
days after commencement, (c) the Corporation or any Significant
Subsidiary thereof is adjudicated insolvent or bankrupt or any
order of relief or other order approving any such case or
proceeding is entered, (d) the Corporation or any Significant
Subsidiary thereof suffers any
appointment of any custodian or the like for it or any
substantial part of its property that is not discharged or
stayed within 60 calendar days after such
appointment,
(e) the Corporation or any Significant Subsidiary
thereof makes a general assignment for the benefit of
creditors, (t) the Corporation or any Significant Subsidiary
thereof calls a meeting of its creditors with a view to arranging a
composition, adjustment or restructuring of its debts, or (g) the
Corporation or any Significant Subsidiary thereof, by any act or
failure to act, expressly indicates its consent to, approval of or
acquiescence in any of the foregoing or takes any corporate or
other action for the purpose of effecting any of the
foregoing.
"Business
Day" means any day except any
Saturday, any Sunday, any day which is a federal legal holiday in
the United States or any day on which banking institutions in the
State of New York are authorized or required by law or other
governmental action to close.
"Canadian Trading
Market" means any of the
following markets or exchanges on which the Common Stock is listed
or quoted for trading on a date in question: the TSX Venture
Exchange and the Toronto Stock Exchange (or any successors to any
of the foregoing).
"Closing"
means the closing of the purchase and sale of the Securities
pursuant to Section 2.1 of the Purchase
Agreement.
"Closing
Date" means the Trading Day on
which all of the Transaction Documents have been executed and
delivered by the applicable parties thereto and all
conditions precedent
to (i) each Holder's obligations to pay the Subscription Amount and
(ii) the Corporation's obligations to deliver the Securities have
been satisfied or waived.
3
"Commission"
means the United States Securities and Exchange Commission.
"Common
Stock" means the
Corporation’s common stock, par value $0.001
per share,
and stock of any other class of securities into which such
securities may hereafter be reclassified or changed.
"Common Stock
Equivalents" means any
securities of the Corporation or the Subsidiaries which would
entitle the holder thereof to acquire at any time Common Stock,
including, without limitation, any debt, preferred stock, rights,
options, warrants or other instrument that is at any time
convertible into or exercisable or exchangeable for, or otherwise
entitles the holder thereof to receive, Common
Stock.
"Conversion
Amount" means the sum of the
Stated Value at issue. "Conversion
Date" shall have the meaning
set forth in Section 6(a). "Conversion
Price" shall have the meaning
set forth in Section 6(b).
"Conversion
Shares" means, collectively,
the shares of Common Stock issuable upon conversion of the shares
of Preferred Stock in accordance with the terms
hereof.
"Debentures"
means the 12% Senior Secured Debentures.
"Dividend Conversion
Rate" means the Market Price
(as such term is defined in the policies of the TSX Venture
Exchange) immediately prior to the Dividend Payment Date in
question provided, however, that if the Common Stock is not listed
or quoted for trading on a Canadian Trading Market, then the
Dividend Conversion Rate shall mean the average of the 20 volume
weighted average prices of the Common Stock on the principal
Trading Market immediately prior to the Dividend Payment Date in
question.
"Dividend Conversion
Shares" shall have the meaning
set forth in Section 3(a).
"Dividend Notice
Period" shall have the meaning
set forth in Section 3(a).
"Dividend Payment
Date" shall have the meaning
set forth iSection 3(a).
"Dividend Share
Amount" shall have the meaning
set forth in Section 3(a).
"Effective
Date" means the earliest of the
date that (a) the initial Registration Statement has been declared
effective by the Commission, (b) all of the Conversion Shares have
been sold pursuant to Rule 144 or may be sold pursuant to Rule 144
without the requirement for the Corporation to be in compliance
with the current public information required
under Rule 144 and without volume or manner-of-sale restrictions,
(c) following the one year anniversary of the Closing Date provided
that a holder of the Underlying Shares is not an Affiliate of the
Corporation or (d) all of the Underlying Shares may be sold
pursuant to an exemption from registration under Section 4(1) of
the Securities Act without volume or manner-of-sale
restrictions.
4
"Equity
Conditions" means, during the
period in question, (a) the Corporation shall have duly honored all
conversions scheduled to occur or occurring by virtue of one or
more Notices of Conversion of the applicable Holder on or prior to
the dates so requested or required, if any, (b)(i) there is an
effective Registration Statement pursuant to which the Holders are
permitted to utilize the prospectus thereunder to resell all of the
shares of Common Stock issuable pursuant to this Certificate of
Designation (and the Corporation believes, in good faith, that such
effectiveness will continue uninterrupted for the foreseeable
future) or (ii) all of the Conversion Shares issuable pursuant to
this Certificate of Designation may be resold pursuant to Rule 144
without volume or manner-of-sale restrictions, (c) the Common Stock
is trading on a Trading Market and all of the shares issuable
pursuant to the Transaction Documents are listed or quoted for
trading on such Trading Market (and the Corporation believes, in
good faith, that trading of the Common Stock on a Trading Market
will continue uninterrupted for the foreseeable future), (d) there
is a sufficient number of authorized, but unissued and otherwise
unreserved, shares of Common Stock for the issuance of all of the
shares then issuable pursuant to the this Certificate of
Designation and (e) the shares issuable upon conversion in full of
the redemption amount to the applicable Holder would not violate
the limitations set forth in Section 6(d)
herein.
"Exchange
Act" means the Securities
Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
"Holder"
shall have the meaning given such term in Section 2.
"Junior
Securities" means the Common
Stock and all other Common Stock Equivalents of the Corporation
other than those securities which are explicitly senior or
pari passu
to the Preferred Stock in dividend
rights or liquidation preference.
"Liens"
means a lien, charge, security interest, encumbrance, right of
first refusal, preemptive right or other
restriction.
"Liquidation"
shall have the meaning set forth in Section 5.
"New York
Courts" shall have the meaning
set forth in Section 9(d). "Notice of
Conversion" shall have the
meaning set forth in Section 6(a). "Optional
Redemption" shall have the
meaning set forth in Section 8(b).
5
"Optional Redemption
Amount" means the aggregate
Stated Value then outstanding plus accrued but unpaid dividends in
respect of the Preferred Stock.
"Optional Redemption
Date" shall have the meaning
set forth in Section 8(b). "Optional Redemption
Notice" shall have the meaning
set forth in Section 8(b).
"Optional Redemption
Notice Date" shall have the
meaning set forth in Section 8(b).
"Original Issue
Date" means the date of the
first issuance of any shares of the Preferred Stock regardless of
the number of transfers of any particular shares of Preferred Stock
and regardless of the number of certificates which may be issued to
evidence such Preferred Stock.
"Person"
means an individual or corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited
liability company, joint stock company, government (or an agency or
subdivision thereof) or other entity of any
kind.
"Preferred Stock" shall have the meaning set forth in Section
2.
"Purchase
Agreement" means the Securities
Purchase Agreement, dated as of December 30, 2019, among
the Corporation and the original Holders, as amended, modified or
supplemented from time to time in accordance with its
terms.
"Registration
Statement" means a registration
statement filed with the Commission covering the resale of the
Conversion Shares by each Holder.
"Rule
144" means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission
having substantially the same effect as such Rule.
"Securities"
means Debentures, Preferred Stock, the Warrants, the Warrant Shares
and the Underlying Shares.
"Securities
Act" means the Securities Act
of 1933, as amended, and the rules and regulations promulgated
thereunder.
"Stated
Value" shall have the meaning
set forth in Section 2, as the same may be increased pursuant to
Section 3.
"Subscription
Amount" shall mean, as to each
Holder, the aggregate amount to be paid for the Preferred Stock
purchased pursuant to the Purchase Agreement as specified below
such Holder's name on the signature page of the Purchase Agreement
and next to the
heading "Subscription Amount," in United States dollars and in
immediately available funds.
6
"Subsidiary"
means any subsidiary of the Corporation as set forth on
Schedule
3.l(a) of the Purchase
Agreement and shall, where applicable, also include any direct or
indirect subsidiary of the Corporation formed or acquired after the
date of the Purchase Agreement.
"Successor
Entity" shall have the meaning
set forth in Section 7(e).
"Trading
Day" means a day on which the
principal Trading Market is open for business.
"Trading
Market" means any of the
following markets or exchanges on which the Common Stock is listed
or quoted for trading on the date in question: the NYSE American,
the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq
Global Select Market, the New York Stock Exchange, OTCQB, OTCQX,
the Toronto Stock Exchange and the TSX Venture Exchange (or any
successors to any of the foregoing).
"Transaction
Documents" means this
Certificate of Designation, the Purchase Agreement, the Debentures,
the Warrants, the Registration Rights Agreement, all exhibits and
schedules thereto and hereto and any other documents or agreements
executed in connection with the transactions contemplated pursuant
to the Purchase Agreement.
"Transfer
Agent" means Computershare, the
current transfer agent of the Corporation, and any successor
transfer agent of the Corporation.
"Underlying
Shares" means the shares of
Common Stock issued and issuable upon conversion or redemption of
the Preferred Stock, upon conversion of the Debentures, upon
exercise of the Warrants and issued and issuable in lieu of the
cash payment of interest on the Debentures and dividends on the
Preferred Stock in accordance with the terms of this Certificate of
Designation.
"VWAP"
means, for any date, the price determined by the first of the
following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted
average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is
then listed or quoted as reported by Bloomberg L.P. (based on a
Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New
York City time)), (b) if OTCQB or OTCQX is not a Trading Market,
the volume weighted average price of the Common Stock for such date
(or the nearest preceding date) on OTCQB or OTCQX as applicable,
(c) if the Common Stock is not then listed or quoted for trading on
OTCQB or OTCQX and if prices for the Common Stock are then reported
in the "Pink Sheets" published by OTC Markets Group, Inc. (or a
similar organization or agency succeeding to its functions of
reporting prices), the most recent bid price per share of the
Common Stock so
reported, or (d) in all other cases,
the fair market value of a share of Common Stock as determined by
an independent appraiser selected in
good faith by the Purchasers of a majority in interest of the
Securities then outstanding and reasonably acceptable to the
Corporation, the fees and expenses of which shall be paid by the
Corporation.
7
"Warrants"
means, collectively, the Common Stock purchase warrants delivered
to the Holder at the Closing in accordance with Section 2.2(a) of
the Purchase Agreement.
"Warrant
Shares" means the shares of
Common Stock issuable upon exercise of the
Warrants.
Section 2. Designation, Amount
and Par Value. The series of
preferred stock shall be
designated as its Series D Convertible Preferred Stock (the
"Preferred
Stock'') and the number of
shares so designated shall be up to 6,000. Each share of Preferred
Stock shall have a par value of $0.001 per share and a stated value
equal to $750, subject to increase set forth in Section 3 below
(the "Stated
Value").
Section
3. Dividends.
a) Dividends in Cash or
in Kind. Each Holder of
Preferred Stock (each, a "Holder"
and collectively, the "Holders")
shall be entitled to receive, and the Corporation shall pay,
cumulative dividends at the rate per share (as a percentage of the
Stated Value per share) of 10% per annum (subject to increase
pursuant to Section lO(b)), payable quarterly on January 15, April 15, July 15
and October 15, beginning on the first such date after the Original
Issue Date and on each Optional Redemption Date (with respect only
to Preferred Stock being redeemed) (each such date, a
"Dividend Payment
Date") (if any Dividend Payment
Date is not a Trading Day, the applicable payment shall be due on
the next succeeding Trading Day) in cash, or, following the
approval of Canadian Trading Market and at the Corporation's option
(subject to the waterfall below), in duly authorized, validly
issued, fully paid and non-assessable shares of
Common Stock as set forth in this Section 3(a), or a combination
thereof (the dollar amount to be paid in shares of Common Stock,
the "Dividend Share
Amount") based on the Dividend
Conversion Rate; provided,
however, the Corporation's
election to pay the Dividend Share Amount in lieu of cash is
subject to the following order of priority: (i) if funds are
legally available for the payment of dividends and the Equity
Conditions have not been met during on the applicable Dividend
Payment Date, in cash only, (ii) if funds are legally available for
the payment of dividends and the Equity Conditions have been met on
the applicable Dividend Payment Date, at the sole election of the
Corporation, in cash or shares of Common Stock which shall be
valued as determined above, (iii) if funds are not legally
available for the payment of dividends and the Equity Conditions
have been met on the applicable Dividend Payment Date, in shares of
Common Stock which shall be valued as determined above, (iv) if
funds are not legally available for the payment of dividends and
the Equity Condition relating to an effective Registration
Statement has been waived by such Holder, as to such Holder only,
in unregistered shares of Common Stock which shall be valued as
determined above, and (v) if funds are not legally available for the payment of
dividends and the Equity Conditions have not been met on the
applicable Dividend Payment Date, then, at the election of such
Holder, such dividends shall accrue to the next Dividend Payment
Date or shall be accreted to, and increase, the outstanding Stated
Value.
b) Corporation's Ability
to Pay Dividends in Cash or Kind. The Corporation shall promptly notify the
Holders at any time the Corporation shall become able or unable, as
the case may be, to legally pay cash dividends. If at any time the
Corporation has the right to pay dividends in cash or shares of
Common Stock, the Corporation must provide the Holders with at
least 5 Trading Days' notice of its election to pay a regularly
scheduled dividend in shares of Common Stock (the Corporation may
indicate in such
notice that the election contained in
such notice shall continue for later periods until revised by a
subsequent notice).
8
c) Dividend
Calculations. Dividends on the
Preferred Stock shall be calculated on the basis of a 360-day year,
consisting of twelve 30 calendar day periods, and
shall accrue daily commencing on the Original Issue
Date, and shall be deemed to accrue from such date whether or not
earned or declared and whether or not there are profits, surplus or
other funds of the Corporation legally available for the payment of
dividends.
d) Late
Fees. Any dividends, whether
paid in cash or shares
of Common Stock, that are not paid
within three Trading Days following a Dividend Payment Date shall
continue to accrue and shall entail a late fee, which must be paid
in cash, at the rate of 12% per annum or the lesser rate permitted
by applicable law which shall accrue daily from the Dividend
Payment Date through and including the date of actual payment in
full.
Section 4. Voting
Rights. Except as otherwise
provided herein or as otherwise required by law, the Preferred
Stock shall have no voting rights. However, as long as any shares
of Preferred Stock are outstanding, the Corporation shall not,
without the affirmative vote of the Holders of a majority of the
then outstanding shares of the Preferred Stock, (a) alter or change
adversely the powers, preferences or rights given to the Preferred
Stock or alter or amend this Certificate of Designation,
(b)
authorize or create any class of stock
ranking as to dividends, redemption or distribution of assets upon
a Liquidation (as defined in Section 5) senior to, or otherwise
pari passu
with, the Preferred Stock, (c) amend
its certificate of incorporation or other charter documents in any
manner that adversely affects any rights of the Holders, (d)
increase the number of authorized shares of Preferred Stock, or (e)
enter into any agreement with respect to any of the
foregoing.
Section 5. Liquidation.
Upon any liquidation, dissolution or winding-up of the Corporation,
whether voluntary or involuntary (a "Liquidation"),
the Holders shall
be entitled to receive out of the
assets, whether capital or surplus, of the Corporation an amount
equal to the Stated Value, plus any accrued and unpaid dividends
thereon and any other fees or liquidated damages then due and owing
thereon under this Certificate of Designation, for each share of
Preferred Stock before any distribution or payment shall be made to
the holders of any Junior Securities, and if the assets of the
Corporation shall be insufficient to pay in full
such amounts, then the entire assets to be distributed
to the Holders shall be ratably distributed among the
Holders in
accordance with the respective amounts that would be payable on
such shares if all amounts payable thereon were paid in
full.
9
Section
6. Conversion.
a)
Conversions at Option
of Holder. Each share of
Preferred Stock shall be convertible, at any time and from time to
time from and after the Original Issue Date until the 5-year
anniversary of the Original Issue Date at the option of the Holder
thereof, into that number of shares of Common Stock
(subject to the limitations set forth in Section 6(d))
determined by dividing the Stated Value of such share of
Preferred Stock by the Conversion Price. Holders shall effect
conversions by providing the Corporation with the form of
conversion notice attached hereto as Annex A
(a "Notice of
Conversion"). Each Notice of
Conversion shall specify the number of shares of Preferred Stock to
be converted, the number of shares of Preferred Stock owned prior
to the conversion at issue, the number of shares of Preferred Stock
owned subsequent to the conversion at issue and the date on which
such conversion is to be effected, which date may not be prior to
the date the applicable Holder delivers by facsimile such Notice of
Conversion to the Corporation (such date, the "Conversion
Date"). If no Conversion Date
is specified in a Notice of Conversion, the Conversion Date shall
be the date that such Notice of Conversion to the Corporation is
deemed delivered hereunder. No ink-original Notice of Conversion
shall be required, nor shall any
medallion guarantee (or other type of guarantee or notarization) of
any Notice of Conversion form be required. The calculations and
entries set forth in the Notice of Conversion shall control in the
absence of manifest or mathematical error. To effect conversions of
shares of Preferred Stock, a Holder shall not be required to
surrender the certificate(s) representing the shares of Preferred
Stock to the Corporation unless all of the shares of Preferred
Stock represented thereby are so converted, in which case such
Holder shall deliver the certificate representing
such shares of Preferred Stock promptly following the
Conversion Date at issue. Shares of Preferred Stock converted into
Common Stock or redeemed in accordance with the terms hereof shall
be canceled and shall not be reissued.
b) Conversion
Price. The conversion price for
the Preferred Stock shall equal $0.25,
subject to adjustment herein (the
"Conversion
Price").
c)
Mechanics of
Conversion.
i. Delivery
of Conversion Shares Upon Conversion. The Corporation shall deliver, or cause to be
delivered, to the converting Holder the number of Conversion Shares
being acquired upon the conversion of the Preferred
Stock.
ii. Obligation
Absolute; Partial Liquidated Damages. The Corporation's obligation to issue and
deliver the Conversion Shares upon conversion of Preferred Stock in
accordance with the terms hereof are absolute and unconditional,
irrespective of any action or inaction by a Holder to enforce the
same, any waiver or consent with respect to any provision hereof,
the recovery of any judgment against any Person or any action to
enforce the same, or any setoff, counterclaim, recoupment,
limitation or termination, or any breach or alleged breach by such
Holder or any other Person of any obligation to the Corporation or
any violation or alleged violation of law by such Holder or any
other person, and irrespective of any other circumstance which
might otherwise limit such obligation of the Corporation to such
Holder in connection with the issuance of such Conversion Shares;
provided, however, that such delivery shall not operate as a waiver
by the Corporation of any such action that the Corporation may have
against such Holder.
10
111. Reservation
of Shares Issuable Upon Conversion. The Corporation covenants that it will at all
times reserve and keep available out of its authorized and unissued
shares of Common Stock for the sole purpose of issuance upon
conversion of the Preferred Stock and payment of dividends on the
Preferred Stock, each as herein provided, free from preemptive
rights or any other actual contingent purchase rights of Persons
other than the Holder (and the other holders of the Preferred
Stock), not less than such aggregate number of shares of the Common
Stock as shall (subject to the terms and conditions set forth in
the Purchase Agreement) be issuable (taking into account the
adjustments and restrictions of Section 7) upon the conversion of
the then outstanding shares of Preferred Stock and payment of
dividends hereunder.
iv. Fractional
Shares. No fractional shares or
scrip representing fractional shares shall be issued upon the
conversion of the Preferred Stock. As to any fraction of a share
which the Holder would otherwise be entitled to purchase upon such
conversion, the Corporation shall at its election, either pay a
cash adjustment in respect of such final fraction in an amount
equal to such fraction multiplied by the Conversion Price or round
up to the next whole share.
v. Transfer
Taxes and Expenses. The
issuance of Conversion Shares on conversion of this Preferred Stock
shall be made without charge to any Holder for any documentary
stamp or similar taxes that may be payable in respect of the issue
or delivery of such Conversion Shares, provided that the
Corporation shall not be required to pay any tax that may be
payable in respect of any transfer involved in the issuance and
delivery of any such Conversion Shares upon conversion in a name
other than that of the Holders of such shares of Preferred Stock
and the Corporation shall not be required to issue or deliver such
Conversion Shares unless or until the Person or Persons requesting
the issuance thereof shall have paid to the Corporation the amount
of such tax or shall have established to the satisfaction of the
Corporation that such tax has been paid.
d) Beneficial
Ownership Limitation. The
Corporation shall not effect any conversion of the Preferred Stock,
and a Holder shall not have the right to convert any portion of the
Preferred Stock, to the extent that, after giving effect to the
conversion set forth on the applicable Notice of Conversion, such
Holder (together with such Holder's Affiliates, and any Persons
acting as a group together with such Holder or
any of such Holder's Affiliates (such Persons, "Attribution
Parties")) would beneficially
own in excess of the Beneficial Ownership Limitation (as defined
below). For purposes of the foregoing sentence, the number of
shares of Common Stock beneficially owned by such Holder and its
Affiliates and Attribution Parties shall include
the number of shares of Common Stock issuable upon conversion of
the Preferred Stock with respect to which such determination is
being made, but shall exclude the number of shares of Common Stock
which are issuable upon (i) conversion of the remaining,
unconverted Stated Value of Preferred Stock beneficially owned by
such Holder or any of its Affiliates or Attribution Parties and
(ii) exercise or conversion of the unexercised or unconverted
portion of any other securities of the Corporation subject to a
limitation on conversion or exercise analogous to the limitation
contained herein (including, without limitation, the Preferred
Stock or the Warrants) beneficially owned by such Holder or any of
its Affiliates or Attribution Parties. Except as set forth in the
preceding sentence, for purposes of this Section 6(d), beneficial
ownership shall be calculated in accordance with Section 13(d) of
the Exchange Act and the rules and regulations promulgated
thereunder. To the extent that the limitation contained in this
Section 6(d) applies, the determination of whether the Preferred
Stock is convertible (in relation to other securities owned by such
Holder together with any Affiliates and Attribution Parties) and of
how many shares of Preferred Stock are convertible shall be in the
sole discretion of such Holder, and the submission of a Notice of
Conversion shall be deemed to be such Holder's determination of
whether the shares of Preferred Stock may be converted (in relation
to other securities owned by such Holder together with any
Affiliates and Attribution Parties) and how many shares of the
Preferred Stock are convertible, in each case subject to the
Beneficial Ownership Limitation. To ensure compliance with this
restriction, each Holder will be deemed to represent to the
Corporation each time it delivers a Notice of Conversion that such
Notice of Conversion has not violated the restrictions set forth in
this paragraph and the Corporation shall have no obligation to
verify or confirm the accuracy of such determination. In addition,
a determination as to any group status as contemplated above shall
be determined in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder. For purposes
of this Section 6(d), in determining the number of outstanding
shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as stated in the most recent of
the following: (i) the Corporation's most recent periodic or annual
report filed with the Commission, as the case may be, (ii) a more
recent public announcement by the Corporation or (iii) a more
recent written notice by the Corporation or the Transfer Agent
setting forth the number of shares of Common Stock outstanding.
Upon the written or oral request of a Holder, the Corporation shall
within one Trading Day confirm orally and in writing to such Holder
the number of shares of Common Stock then outstanding.
In
any case, the number of outstanding
shares of Common Stock shall be determined after giving effect to
the conversion or exercise of securities of the Corporation,
including the Preferred Stock, by such Holder or its Affiliates or
Attribution Parties since the date as of which such number of
outstanding shares of Common Stock was reported. The
"Beneficial Ownership
Limitation" shall be 4.99% (or,
upon election by a Holder prior to the issuance of any shares of
Preferred Stock, 9.99%) of the number of shares of the Common Stock
outstanding immediately after giving effect to the issuance of
shares of Common Stock issuable upon conversion of Preferred Stock
held by the
applicable Holder. A Holder, upon notice to the Corporation, may
increase or decrease the Beneficial Ownership Limitation provisions
of this Section 6(d) applicable to its Preferred Stock provided
that the Beneficial Ownership Limitation in no event exceeds 9.99%
of the number of shares of the Common Stock outstanding immediately
after giving effect to the issuance of shares of Common Stock upon
conversion of this Preferred Stock held by the Holder and the
provisions of this Section 6(d) shall continue to apply. Any such
increase in the Beneficial Ownership Limitation will not be
effective until the 61st day after such notice is delivered to the
Corporation and shall only apply to such Holder and no other
Holder. The provisions of this paragraph shall be construed and
implemented in a manner otherwise than in strict conformity with
the terms of this Section 6(d) to correct this paragraph (or any
portion hereof) which may be defective or inconsistent with the
intended Beneficial Ownership Limitation contained herein or to
make changes or supplements necessary or desirable to properly give
effect to such limitation. The limitations contained in this
paragraph shall apply to a successor holder of Preferred
Stock.
11
Section
7.
Certain
Adjustments.
a) Stock
Dividends and Stock Splits. If the Corporation, at any time while this Preferred
Stock is outstanding: (i) pays a stock dividend or otherwise makes
a distribution or distributions payable in shares of Common Stock
on shares of Common Stock or any other Common Stock Equivalents
(which, for avoidance of doubt, shall not include any shares of
Common Stock issued by the Corporation upon conversion of, or
payment of a dividend on, this Preferred Stock), (ii) subdivides
outstanding shares of Common Stock into a larger number of
shares, (iii) combines (including by way of a reverse stock
split) outstanding shares of Common Stock into a smaller number of
shares, or (iv) issues, in the event of a reclassification of
shares of the Common Stock, any shares of capital stock of the
Corporation, then the Conversion Price shall be multiplied by a
fraction of which the numerator shall be the number of shares of
Common Stock (excluding any treasury shares of the Corporation)
outstanding immediately before such event, and of which the
denominator shall be the number of shares of Common Stock
outstanding immediately after such event. Any adjustment made
pursuant to this Section 7(a) shall become effective immediately
after the record date for the determination of stockholders
entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a
subdivision, combination or re-classification.
b) Fundamental
Transaction. If, at any time
while this Preferred Stock is outstanding, (i) the Corporation,
directly or indirectly, in one or more related transactions effects
any merger or consolidation of the Corporation with or into another
Person, (ii) the Corporation, directly or indirectly, effects any
sale, lease, license, assignment, transfer, conveyance or other
disposition of all or substantially all of its assets in one or a
series of related transactions, (iii) any, direct or indirect,
purchase offer, tender offer or exchange offer (whether by the
Corporation or another Person) is completed pursuant to which
holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been
accepted by the holders of 50% or more of the outstanding Common
Stock, (iv) the Corporation, directly or indirectly, in one or
more related
transactions effects any reclassification, reorganization or
recapitalization of the Common Stock or any compulsory share
exchange pursuant to which the Common Stock is effectively
converted into or exchanged for other securities, cash or property,
or (v) the Corporation, directly or indirectly, in one or more
related transactions consummates a stock or share purchase
agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme
of arrangement) with another Person whereby such other Person
acquires more than 50% of the outstanding shares of Common Stock
(not including any shares of Common Stock held by the other Person
or other Persons making or party to, or associated or affiliated
with the other Persons making or party to, such stock or share purchase agreement or other
business combination) (each a "Fundamental
Transaction"),
then, upon any subsequent conversion of this Preferred Stock, the
Holder shall have the right to receive, for each Conversion Share
that would have been issuable upon such conversion immediately
prior to the occurrence of such Fundamental Transaction (without
regard to any limitation in Section 6(d) on the conversion of this
Preferred Stock), the number of shares of Common Stock of the
successor or acquiring corporation or of the Corporation, if it is
the surviving corporation, and any additional consideration (the
"Alternate
Consideration") receivable as a result of such
Fundamental Transaction by a holder of the number of shares of
Common Stock for which this Preferred Stock is convertible
immediately prior to such Fundamental Transaction (without regard
to any limitation in Section 6(d) on the conversion of this
Preferred Stock). For purposes of any such conversion, the
determination of the Conversion Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the
amount of Alternate Consideration issuable in respect of one share
of Common Stock in such Fundamental Transaction, and the
Corporation shall apportion the Conversion Price among the
Alternate Consideration in a reasonable manner reflecting the
relative value of any different components of the Alternate
Consideration. If holders of Common Stock are given any choice as
to the securities, cash or property to be received in a Fundamental
Transaction, then the Holder shall be given the same choice as to
the Alternate Consideration it receives upon any conversion of this
Preferred Stock following such Fundamental
Transaction.
c) Calculations.
All calculations under this Section 7 shall be made to the nearest
cent or the nearest 11100th of a share, as the case may be. For
purposes of this Section 7, the number of shares of
Common Stock deemed to be issued and outstanding as of a given date
shall be the sum
of the number of shares of Common
Stock (excluding any treasury shares of the Corporation) issued and
outstanding.
d)
Notice to the
Holders.
i. Adjustment
to Conversion Price. Whenever
the Conversion Price is adjusted pursuant to any provision of this
Section 7, the Corporation shall promptly deliver to each Holder by
facsimile or email a notice setting forth the Conversion Price
after such adjustment and setting forth a brief statement of the
facts requiring such adjustment.
12
ii.
Notice to Allow
Conversion by Holder. If (A)
the Corporation shall declare a dividend (or any other distribution
in whatever form) on the Common Stock, (B) the Corporation shall
declare a special nonrecurring cash dividend on or a redemption of
the Common Stock, (C) the Corporation shall authorize the granting
to all holders of the Common Stock of rights or warrants to
subscribe for or purchase any shares of capital stock of any class
or of any rights, (D) the approval of any stockholders of the
Corporation shall be required in connection with any
reclassification of the Common Stock, any consolidation or merger
to which the Corporation is a party, any sale or transfer of all or
substantially all of the assets of the Corporation, or any
compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property or (E) the Corporation
shall authorize the voluntary or involuntary dissolution,
liquidation or winding up of the affairs of the Corporation, then,
in each case, the Corporation shall cause to be filed at each
office or agency maintained for the purpose of conversion of this
Preferred Stock, and shall cause to be delivered by facsimile or
email to each Holder at its last facsimile number or email address
as it shall appear upon the stock books of the Corporation, at
least twenty (20) calendar days prior to the applicable record or
effective date hereinafter specified, a notice stating (x) the date
on which a record is to be taken for the purpose of such dividend,
distribution, redemption, rights or warrants, or if a record is not
to be taken, the date as of which the holders of the Common Stock
of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date
on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or
close, and the date as of which it is expected that holders of the
Common Stock of record shall be entitled to exchange their shares
of the Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger,
sale, transfer or share exchange, provided that the failure to
deliver such notice or any defect therein or in the delivery
thereof shall not affect the validity of the corporate action
required to be specified in such notice. To the extent that any
notice provided hereunder constitutes, or
contains, material, non-public information regarding the
Corporation or any of the Subsidiaries, the Corporation shall
simultaneously file such notice with the Commission pursuant to a
Current Report on Form 8-K. The Holder shall remain entitled to
convert the Conversion Amount of this Preferred Stock (or any part
hereof) during the 20-day period commencing on the date of such
notice through the effective date of the event triggering such
notice except as may otherwise be expressly set forth
herein.
Section 8. Optional Redemption at
Election of Corporation.
Subject to the provisions of this Section 8, at any time following
the Effective Date if the average of the VWAPs for any consecutive
5 Trading Day period ("Measurement
Period") exceeds 200% of the
then Conversion Price and the average daily trading volume of the
Common Stock on the primary Trading Market exceeds 1,000 shares per
Trading Day during the Measurement Period (subject to adjustment
for reverse and forward stock splits and the like), then the
Corporation may deliver a notice to the Holders (an
"Optional Redemption
Notice" and the date such
notice is deemed delivered hereunder, the "Optional Redemption
Notice Date") of its
irrevocable election to redeem some or all of the then outstanding
Preferred Stock, for cash in an amount equal to the Optional
Redemption Amount on the 201h Trading Day following the Optional Redemption
Notice Date (such date, the "Optional Redemption
Date" and such redemption, the
"Optional
Redemption"). The Optional
Redemption Amount is payable in full on the Optional Redemption
Date. The Corporation may only effect an Optional Redemption
if
each of the Equity Conditions shall
have been met on each Trading Day occurring during the period
commencing on the Optional Redemption Notice Date through to the
Optional Redemption Date and through and including the date payment
of the Optional Redemption Amount is actually made.
If
any of the Equity Conditions shall
cease to be satisfied at any time during the 20 Trading Day period,
then a Holder may elect to nullify the Optional Redemption Notice
as to such Holder by notice to the Corporation within 3 Trading
Days after the first day on which any such Equity Condition has not
been met (provided that if, by a provision of the Transaction
Documents, the Corporation is obligated to notify the Holders of
the non-existence of an Equity Condition, such notice
period shall
be extended to the third Trading Day
after proper notice from the Corporation) in which case the
Optional Redemption Notice shall be null and void, ab
initio.
The Corporation covenants and agrees that it will honor all Notices
of Conversion tendered from the time of delivery of the Optional
Redemption Notice through the date the Optional Redemption Amount
is paid in full.
Section
9. Miscellaneous.
a) Notices.
Any and all notices or other communications or deliveries to be
provided by the Holders hereunder including, without limitation,
any Notice of Conversion, shall be in writing and delivered
personally, by facsimile or e-mail attachment, or sent by a
nationally recognized overnight courier service, addressed to the
Corporation, at the address set forth above Attention: Mark Faupel,
COO, e-mail address mfaupel@guidedinc.com, or such other facsimile number, e-mail address or
address as the Corporation may specify for such purposes by notice
to the Holders delivered in accordance with this Section 11. Any
and all notices or other communications or deliveries to be
provided by the Corporation hereunder shall be in writing and
delivered personally, by facsimile or e-mail attachment, or sent by
a nationally recognized overnight courier service addressed to each
Holder at the facsimile number, e-mail address or address of such
Holder appearing on the books of the Corporation, or if no such
facsimile number, e-mail address or address appears on the books of
the Corporation, at the principal place of business of such Holder,
as set forth in the Purchase Agreement. Any notice or other
communication or deliveries hereunder shall be deemed given and
effective on the earliest of (i) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile
number or e-mail attachment at the e-mail address set forth in this
Section prior to 5:30 p.m. (New York City time) on any date, (ii)
the next Trading Day after the date of transmission, if such notice
or communication is delivered via facsimile at the facsimile number
or e-mail attachment at the e-mail address set forth in this
Section on a day that is not a Trading Day or later than 5:30 p.m.
(New York City time) on any Trading Day, (iii) the second Trading
Day following the date of mailing, if sent by U.S. nationally
recognized overnight courier service, or (iv) upon actual receipt
by the party to whom such notice is required to be
given.
13
b) Absolute
Obligation. Except as expressly
provided herein, no provision of this Certificate of Designation
shall alter or impair the obligation of the Corporation, which is
absolute and unconditional, to pay liquidated damages, accrued
dividends and accrued interest, as applicable, on the shares of
Preferred Stock at the time, place, and rate, and in the coin or
currency, herein prescribed.
c) Lost
or Mutilated Preferred Stock Certificate. If a Holder's Preferred Stock certificate
shall be mutilated, lost, stolen or destroyed, the
Corporation shall execute and deliver, in exchange and substitution
for and upon cancellation of a mutilated certificate, or in lieu of
or in substitution for a lost, stolen or destroyed certificate, a
new certificate for the shares of Preferred Stock so mutilated,
lost, stolen or destroyed, but only upon receipt of evidence of
such loss, theft or destruction of such certificate, and of the
ownership hereof reasonably satisfactory to the
Corporation.
d) Governing
Law. All questions concerning
the construction, validity, enforcement and interpretation of this
Certificate of Designation shall be governed by and construed and
enforced in accordance with the internal laws of the State of
Delaware, without regard to the principles of conflict of laws
thereof. All legal proceedings concerning the interpretation,
enforcement and defense of the transactions contemplated by any of
the Transaction Documents (whether brought against a party hereto
or its respective Affiliates, directors, officers, shareholders,
employees or agents) shall be commenced in the state and federal
courts sitting in the City of New York, Borough of Manhattan (the
"New York
Courts"). The Corporation and
each Holder hereby irrevocably submits to the exclusive
jurisdiction of the New York Courts for the adjudication of any
dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to
the enforcement of any of the Transaction Documents), and hereby
irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the
jurisdiction of such New York Courts, or such New York Courts are
improper or inconvenient venue for such proceeding. The Corporation
and each Holder hereby irrevocably waives personal service of
process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to
such party at the address in effect for notices to it under this
Certificate of Designation and agrees that such service shall
constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any other manner permitted by
applicable law. The Corporation and each Holder hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of
or relating to this Certificate of Designation or the transactions
contemplated hereby. If the Corporation or any Holder shall
commence an action or proceeding to enforce any provisions of this
Certificate of Designation, then the prevailing party in such
action or proceeding shall be reimbursed by the other party for its
attorneys' fees and other costs and expenses incurred in the
investigation, preparation and prosecution of such action or
proceeding.
e) Waiver.
Any waiver by the Corporation or a Holder of a breach of any
provision of this Certificate of Designation shall not operate as
or be construed to be a waiver of any other breach of such
provision or of any breach of any other provision of this
Certificate of Designation or a waiver by any other Holders. The
failure of the Corporation or a Holder to insist upon strict
adherence to any term of this Certificate of Designation on one or
more occasions shall not be considered a waiver or deprive that
party (or any other Holder) of the right thereafter to insist upon
strict adherence to that term or any other term of this Certificate
of Designation on any other occasion. Any waiver by the Corporation
or a Holder must be in writing.
f) Severability.
If any provision of this Certificate of Designation is invalid,
illegal or unenforceable, the balance of this Certificate of
Designation shall remain in effect, and if any provision is
inapplicable to any Person or circumstance, it shall nevertheless
remain applicable to all other Persons and circumstances. If it
shall be found that any interest or other amount deemed interest
due hereunder violates the applicable law governing usury, the
applicable rate of interest due hereunder shall automatically be
lowered to equal the maximum rate of interest permitted under
applicable law.
g) Next
Business Day. Whenever any
payment or other obligation hereunder shall be due on a day other
than a Business Day, such payment shall be made on the next
succeeding Business Day.
h) Headings.
The headings contained herein are for convenience only, do not
constitute a part of this Certificate of Designation and shall not
be deemed to limit or affect any of the provisions
hereof.
i) Status
of Converted or Redeemed Preferred Stock. Shares of Preferred Stock may only be issued
pursuant to the Purchase Agreement. If any shares of Preferred
Stock shall be converted, redeemed or
reacquired by the Corporation, such shares shall resume the status
of authorized but issued shares of preferred stock and shall no
longer be designated as Series D Convertible Preferred
Stock.
j)
Non-Transferrable.
The Preferred Stock may not be transferred.
*********************
14
RESOLVED, FURTHER,
that the Chai1man, the president or any vice-president, and the
secretary or any assistant secretary, of the Corporation be and
they hereby are authorized and directed to prepare and file this
Certificate of Designation of Preferences, Rights and Limitations
in accordance with the foregoing resolution and the provisions of
Delaware law.
IN
WITNESS WHEREOF, the undersigned have executed this Certificate
this 31st day
of
March, 2020.
/s/
Gene Cartwright
|
/s/
Mark Faupel
|
Name:
Gene Cartwright
|
Name:
Mark Faupel
|
Title:
President and CEO
|
Title:
Secretary and COO
|
15
ANNEX
A
NOTICE
OF CONVERSION
(TO BE
EXECUTED BY THE REGISTERED HOLDER IN ORDER TO CONVERT SHARES OF
PREFERRED STOCK)
The
undersigned hereby elects to convert the number of shares of Series
D Convertible Preferred Stock indicated below into shares of common
stock, par value $0.001 per share (the "Common Stock"), of Guided
Therapeutics, Inc., a Delaware corporation (the "Corporation"), according to the
conditions hereof, as of the date written below. If shares of Common Stock are to be issued
in the name of a Person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto and is
delivering herewith such certificates and opinions as may be
required by the Corporation in accordance with the Purchase
Agreement. No fee will be charged to the Holders for any
conversion, except for any such transfer taxes.
Conversion
calculations:
Date to
Effect Conversion:-------------------- Number of shares of
Preferred Stock owned prior to Conversion:------
Number of shares of Preferred Stock to be
Converted:----------- Stated
Value of shares of Preferred Stock to be
Converted:---------
Number of shares of Common Stock to
be Issued:------------
Applicable
Conversion
____________________________________________
Number
of shares of Preferred Stock subsequent to
Conversion: ___________________
Address
for Delivery:----------
or
DWAC
Instructions:
Broker no:----
Account no:-----
|
[HOLDER]
_______________________
Name:
Title:
|
16