Contract
Exhibit
4.31
THIS
SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
Original Issue
Date: December __, 2019
$_______________
DUE
__________ ___, 20221
THIS
12% SENIOR SECURED DEBENTURE is one of a series of duly authorized
and validly issued 12% Senior Secured Debentures of Guided
Therapeutics, Inc., a Delaware corporation, (the
“Company”),
having its principal place of business at 0000 Xxxxxxxxx Xxxxxxx Xxxx, Xxxxx X,
Xxxxxxxx, Xxxxxxx 00000, designated as its 12% Senior Secured
Debenture due ______________ __, 2022 (this debenture, the
“Debenture” and,
collectively with the other debentures of such series, the
“Debentures”).
FOR
VALUE RECEIVED, the Company promises to pay to
________________________ or its registered assigns (the
“Holder”), or shall have
paid pursuant to the terms hereunder, the principal sum of
$_______________ on December __, 2020 (the “Maturity Date”) or such
earlier date as this Debenture is required or permitted to be
repaid as provided hereunder, and to pay interest to the Holder on
the then outstanding principal amount of this Debenture in
accordance with the provisions hereof. This Debenture is subject to
the following additional provisions:
Section 1. Definitions. For the purposes
hereof, in addition to the terms defined elsewhere in this
Debenture, (a) capitalized terms not otherwise defined herein shall
have the meanings set forth in the Purchase Agreement and (b) the
following terms shall have the following meanings:
“Bankruptcy Event” means
any of the following events: (a) the Company or any Significant
Subsidiary (as such term is defined in Rule 1-02(w) of Regulation
S-X) 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 Company or any Significant
Subsidiary thereof, (b) there is commenced against the Company or
any Significant Subsidiary thereof any such case or proceeding that
is not dismissed within 60 days after commencement, (c) the Company
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 Company 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 Company or any Significant Subsidiary thereof
makes a general assignment for the benefit of creditors, (f) the
Company or any Significant Subsidiary thereof calls a meeting of
its creditors with a view to arranging a composition, adjustment or
restructuring of its debts, (g) the Company or any Significant
Subsidiary thereof admits in writing that it is generally unable to
pay its debts as they become due, (h) the Company 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.
1 3 years
from issue date.
“Change of Control
Transaction” means the occurrence after the date
hereof of any of (a) an acquisition after the date hereof by an
individual or legal entity or “group” (as described in
Rule 13d-5(b)(1) promulgated under the Exchange Act) of effective
control (whether through legal or beneficial ownership of capital
stock of the Company, by contract or otherwise) of in excess of 50%
of the voting securities of the Company, (b) the Company merges
into or consolidates with any other Person, or any Person merges
into or consolidates with the Company and, after giving effect to
such transaction, the stockholders of the Company immediately prior
to such transaction own less than 50% of the aggregate voting power
of the Company or the successor entity of such transaction, (c) the
Company sells or transfers all or substantially all of its assets
to another Person and the stockholders of the Company immediately
prior to such transaction own less than 50% of the aggregate voting
power of the acquiring entity immediately after the transaction,
(d) a replacement at one time or within a three year period of more
than one-half of the members of the Board of Directors which is not
approved by a majority of those individuals who are members of the
Board of Directors on the Original Issue Date (or by those
individuals who are serving as members of the Board of Directors on
any date whose nomination to the Board of Directors was approved by
a majority of the members of the Board of Directors who are members
on the date hereof), or (e) the execution by the Company of an
agreement to which the Company is a party or by which it is bound,
providing for any of the events set forth in clauses (a) through
(d) above.
“Event of
Default” shall have the
meaning set forth in Section 8(a).
“Interest Conversion Rate”
means the average of the 20 VWAPs
immediately prior to the Interest Payment Date.
“Interest Conversion
Shares” shall have the meaning set forth in Section
2(a).
“Interest Payment Date”
shall have the meaning set forth in Section 2(a).
“Interest Share Amount”
shall have the meaning set forth in Section 2(a).
“Late Fees” shall have the
meaning set forth in Section 2(c).
“Mandatory Default Amount”
means the sum of the outstanding principal amount of this
Debenture, plus all accrued and unpaid interest
hereon.
“New York Courts” shall
have the meaning set forth in Section 9(d).
“Original Issue Date”
means the date of the first issuance of the Debentures, regardless
of any transfers of any Debenture and regardless of the number of
instruments which may be issued to evidence such
Debentures.
“Purchase Agreement” means
the Securities Purchase Agreement, dated as of July __, 2019 among
the Company and the original Holders, as amended, modified or
supplemented from time to time in accordance with its
terms.
“Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.
“Trading Day” means a day
on which the principal Trading Market is open for
trading.
“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 or
OTCQX (or any successors to any of the foregoing).
“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, 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 Company, the fees and expenses of
which shall be paid by the Company.
Section 2.
Interest.
a) Payment of Interest. The
Company shall pay interest to the Holder on the aggregate
unconverted and then outstanding principal amount of this Debenture
at the rate of 10% per annum, payable quarterly on January 15,
April 15, July 15 and October 15, beginning on the first such date
after the Original Issue Date, on each Conversion Date (as to that
principal amount then being converted) and on each Optional
Redemption Date (as to that principal amount then being redeemed)
(each such date, an “Interest Payment Date”)
(if any Interest Payment Date is not a Business Day, then the
applicable payment shall be due on the next succeeding Business
Day), in cash or, at the Company’s option, in duly
authorized, validly issued, fully paid and non-assessable shares of
Common Stock at the Interest Conversion Rate (the dollar amount to
be paid in shares, the “Interest Share Amount”
and such shares, the “Interest Conversion
Shares”)) or a combination thereof; provided, however, that payment in shares
of Common Stock may only occur if (i) the Company shall have given
the Holder notice in accordance with the notice requirements set
forth below, and (ii) as to such Interest Payment Date, prior to
such Interest Notice Period (but not more than five (5) Trading
Days prior to the commencement of such Interest Notice
Period).
b) Interest Calculations. Interest
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 until payment in full of the outstanding
principal, together with all accrued and unpaid interest, and other
amounts which may become due hereunder, has been made. Interest
hereunder will be paid to the Person in whose name this Debenture
is registered on the records of the Company regarding registration
and transfers of this Debenture (the “Debenture
Register”).
c) Late
Fee. All overdue accrued and unpaid interest to be paid
hereunder shall entail a late fee at an interest rate equal to the
lesser of 12% per annum or the maximum rate permitted by applicable
law (the “Late
Fees”) which shall accrue daily from the date such
interest is due hereunder through and including the date of actual
payment in full.
d) Prepayment. The Company may
prepay any portion of the principal amount of this Debenture
without the prior written consent of the Holder.
Section
3. Registration
of Transfers and Exchanges.
a) Different Denominations. This
Debenture is exchangeable for an equal aggregate principal amount
of Debentures of different authorized denominations, as requested
by the Holder surrendering the same. No service charge will be
payable for such registration of transfer or exchange.
b) Investment Representations.
This Debenture has been issued subject to certain investment
representations of the original Holder set forth in the Purchase
Agreement and may be transferred or exchanged only in compliance
with the Purchase Agreement and applicable federal and state
securities laws and regulations.
c) Reliance on Debenture Register.
Prior to due presentment for transfer to the Company of this
Debenture, the Company and any agent of the Company may treat the
Person in whose name this Debenture is duly registered on the
Debenture Register as the owner hereof for the purpose of receiving
payment as herein provided and for all other purposes, whether or
not this Debenture is overdue, and neither the Company nor any such
agent shall be affected by notice to the contrary.
Section
4. [INTENTIONALLY
DELETED].
Section 5.
[INTENTIONALLY
DELETED].
Section
7. Negative Covenants. As long as
any portion of this Debenture remains outstanding, unless the
holders of at least 50.1% in principal amount of the then
outstanding Debentures shall have otherwise given prior written
consent, the Company shall not, and shall not permit any of the
Subsidiaries to, directly or indirectly:
a) amend
its charter documents, including, without limitation, its
certificate of incorporation and bylaws, in any manner that
materially and adversely affects any rights of the
Holder;
b) repay, repurchase
or offer to repay, repurchase or otherwise acquire more than a
de minimis number of shares of its
Common Stock or Common Stock Equivalents other than (i) as
permitted or required under the Transaction Documents and (ii)
repurchases of Common Stock or Common Stock Equivalents of
departing officers and directors of the Company, provided that such
repurchases shall not exceed an aggregate of $100,000 for all
officers and directors during the term of this
Debenture;
c) repay,
repurchase or offer to repay, repurchase or otherwise acquire any
Indebtedness, other than the Debentures if on a pro-rata basis,
other than regularly scheduled principal and interest payments as
such terms are in effect as of the Original Issue Date, provided
that such payments shall not be permitted if, at such time, or
after giving effect to such payment, any Event of Default exist or
occur;
d) pay
cash dividends or distributions on any equity securities of the
Company; or
e) enter
into any agreement with respect to any of the foregoing.
Section 8.
Events of
Default.
a) “Event of Default” means,
wherever used herein, any of the following events (whatever the
reason for such event and whether such event shall be voluntary or
involuntary or effected by operation of law or pursuant to any
judgment, decree or order of any court, or any order, rule or
regulation of any administrative or governmental
body):
i. any
default in the payment of (A) the principal amount of any Debenture
or (B) interest and other amounts owing to a Holder on any
Debenture, as and when the same shall become due and payable which
default, solely in the case of an interest payment or other default
under clause (B) above, is not cured within 10 Business
Days;
ii. the
Company shall fail to observe or perform any other covenant or
agreement contained in the Debentures or in any Transaction
Document, which failure is not cured, if possible to cure, within
the earlier to occur of
(A) 10 Business Days after notice of such failure
sent by the Holder or by any other Holder to the Company and (B) 15 Business Days after
the Company has become or should have become aware of such
failure;
iii. a
default or event of default (subject to any grace or cure period
provided in the applicable agreement, document or instrument) shall
occur under (A) any of the Transaction Documents or (B) any other
material agreement, lease, document or instrument to which the
Company or any Subsidiary is obligated (and not covered by clause
(vi) below);
iv. any representation or warranty made in this Debenture, any
other Transaction Documents, any written statement pursuant hereto
or thereto or any other report, financial statement or certificate
made or delivered to the Holder or any other Holder shall be untrue
or incorrect in any material respect as of the date when made or
deemed made;
v. the Company or any
Significant Subsidiary (as such term is defined in Rule 1-02(w) of
Regulation S-X) shall be subject to a Bankruptcy
Event;
vi. the Company or any
Subsidiary shall default on any of its obligations under any
mortgage, credit agreement or other facility, indenture agreement,
factoring agreement or other instrument under which there may be
issued, or by which there may be secured or evidenced, any
indebtedness for borrowed money or money due under any long term
leasing or factoring arrangement that (a) involves an obligation
greater than $250,000, whether such indebtedness now exists or
shall hereafter be created, and (b) results in such indebtedness
becoming or being declared due and payable prior to the date on
which it would otherwise become due and payable;
vii. any
monetary judgment, writ or similar final process shall be entered
or filed against the Company, any subsidiary or any of their
respective property or other assets for more than $250,000, and
such judgment, writ or similar final process shall remain
unvacated, unbonded or unstayed for a period of 90 calendar
days.
b) Remedies Upon Event of Default.
If any Event of Default occurs, the outstanding principal amount of
this Debenture, plus accrued but unpaid interest, and other amounts
owing in respect thereof through the date of acceleration, shall
become, at the Holder’s election, immediately due and payable
in cash at the Mandatory Default Amount. Commencing 5 days after
the occurrence of any Event of Default that results in the eventual
acceleration of this Debenture, the interest rate on this Debenture
shall accrue at an interest rate equal to the lesser of 15% per
annum or the maximum rate permitted under applicable law. Upon the
payment in full of the Mandatory Default Amount, the Holder shall
promptly surrender this Debenture to or as directed by the Company.
In connection with such acceleration described herein, the Holder
need not provide, and the Company hereby waives, any presentment,
demand, protest or other notice of any kind, and the Holder may
immediately and without expiration of any grace period enforce any
and all of its rights and remedies hereunder and all other remedies
available to it under applicable law. Such acceleration may be
rescinded and annulled by Xxxxxx at any time prior to payment
hereunder and the Holder shall have all rights as a holder of the
Debenture until such time, if any, as the Holder receives full
payment pursuant to this Section 8(b). No such rescission or
annulment shall affect any subsequent Event of Default or impair
any right consequent thereon.
Section 9.
Miscellaneous.
a) Notices. Any and all notices or
other communications or deliveries to be provided by the Holder
hereunder shall be in writing and delivered personally, by
facsimile, by email attachment, or sent by a nationally recognized
overnight courier service, addressed to the Company, at the address
set forth above, or such other facsimile number, email address, or
address as the Company may specify for such purposes by notice to
the Holder delivered in accordance with this Section 9(a).
Any and all notices or other communications or deliveries to be
provided by the Company hereunder shall be in writing and delivered
personally, by facsimile, by email attachment, or sent by a
nationally recognized overnight courier service addressed to each
Holder at the facsimile number, email address or address of the
Holder appearing on the books of the Company, or if no such
facsimile number or email attachment or address appears on the
books of the Company, 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 email attachment to the email address set forth
on the signature pages attached hereto prior to 5:30 p.m. (New York
City time) on any date, (ii) the next Business Day after the date
of transmission, if such notice or communication is delivered via
facsimile at the facsimile number or email attachment to the email
address set forth on the signature pages attached hereto on a day
that is not a Business Day or later than 5:30 p.m. (New York City
time) on any Business Day, (iii) the second Business 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.
b) Absolute Obligation. Except as
expressly provided herein, no provision of this Debenture shall
alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of, and accrued interest,
as applicable, on this Debenture at the time, place, and rate, and
in the coin or currency, herein prescribed. This Debenture is a
direct debt obligation of the Company. This Debenture ranks
pari passu with all other Debentures
now or hereafter issued under the terms set forth
herein.
c) Lost or Mutilated Debenture. If
this Debenture shall be mutilated, lost, stolen or destroyed, the
Company shall execute and deliver, in exchange and substitution for
and upon cancellation of a mutilated Debenture, or in lieu of or in
substitution for a lost, stolen or destroyed Debenture, a new
Debenture for the principal amount of this Debenture so mutilated,
lost, stolen or destroyed, but only upon receipt of evidence of
such loss, theft or destruction of such Debenture, and of the
ownership hereof, reasonably satisfactory to the
Company.
d) Governing Law. All questions
concerning the construction, validity, enforcement and
interpretation of this Debenture shall be governed by and construed
and enforced in accordance with the internal laws of the State of
New York, without regard to the principles of conflict of laws
thereof. Each party agrees that 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”). Each
party hereto 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. Each party
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 Debenture 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. Each party hereto 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 Debenture or the transactions
contemplated hereby. If any party shall commence an action or
proceeding to enforce any provisions of this Debenture, 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
Company or the Holder of a breach of any provision of this
Debenture 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 Debenture. The failure of the Company or the
Holder to insist upon strict adherence to any term of this
Debenture on one or more occasions shall not be considered a waiver
or deprive that party of the right thereafter to insist upon strict
adherence to that term or any other term of this Debenture on any
other occasion. Any waiver by the Company or the Holder must be in
writing.
f) Severability. If any provision
of this Debenture is invalid, illegal or unenforceable, the balance
of this Debenture 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. The Company covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead,
or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would
prohibit or forgive the Company from paying all or any portion of
the principal of or interest on this Debenture as contemplated
herein, wherever enacted, now or at any time hereafter in force, or
which may affect the covenants or the performance of this
Debenture, and the Company (to the extent it may lawfully do so)
hereby expressly waives all benefits or advantage of any such law,
and covenants that it will not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the
Holder, but will suffer and permit the execution of every such as
though no such law has been enacted.
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 Debenture and shall not be deemed to limit or affect any of
the provisions hereof.
i) Secured Obligation. The
obligations of the Company under this Debenture are secured by all
assets of the Company and each Subsidiary pursuant to the Security
Agreement, dated as of July __, 2019 between the Company, the
Subsidiaries of the Company and the Secured Parties (as defined
therein).
Section
10. Disclosure.
Upon receipt or delivery by the Company of any notice in accordance
with the terms of this Debenture, unless the Company has in good
faith determined that the matters relating to such notice do not
constitute material, nonpublic information relating to the Company
or its Subsidiaries, the Company shall within two (2) Business Days
after such receipt or delivery publicly disclose such material,
nonpublic information on a Current Report on Form 8-K or otherwise.
In the event that the Company believes that a notice contains
material, non-public information relating to the Company or its
Subsidiaries, the Company so shall indicate to the Holder
contemporaneously with delivery of such notice, and in the absence
of any such indication, the Holder shall be allowed to presume that
all matters relating to such notice do not constitute material,
nonpublic information relating to the Company or its
Subsidiaries.
*********************
(Signature Pages Follow)
IN
WITNESS WHEREOF, the Company has caused this Debenture to be duly
executed by a duly authorized officer as of the date first above
indicated.
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GUIDED
THERAPEUTICS, INC.
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By:__________________________________________
Name:
Title:
Facsimile No. for
delivery of Notices: _______________
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