EXCHANGE AGREEMENT
Exhibit 10.60
This
EXCHANGE AGREEMENT (this “Agreement”) is made and
entered into effective as of May 22, 2020, by and between GUIDED
THERAPEUTICS, INC., a Delaware corporation (the “Company”) and Auctus
Fund, LLC, a Delaware limited liability company (the
“Creditor”).
W I
T N E S S E T H :
WHEREAS, the
Creditor is the payee of certain obligations owed to the Creditor
by the Company as set forth in the convertible promissory notes
listed on Exhibit A
hereto (the “Notes”) (the collective obligations under
the Notes shall referred to herein as the “Obligations”);
WHEREAS, in
satisfaction in full of the Obligations, the Creditor is willing to
accept the Cash Payments (as defined in this Agreement) and
Securities (as defined in this Agreement) (the “Exchange”);
WHEREAS, the
Exchange is being made in reliance upon the exemption from
registration provided by Section 4(a)(2) of the Securities
Act.
WHEREAS, the
Company and the Creditor desire to enter into this Agreement to
evidence and set forth the terms of the exchange of the Cash
Payments and Securities (as defined in this Agreement) for and in
satisfaction of the Obligations;
NOW,
THEREFORE, in consideration of the mutual covenants herein
contained, and intending to be legally bound hereby, the parties
hereto, being duly sworn, do covenant, agree and certify as
follows:
1. Recitals.
The parties hereto acknowledge and agree that the foregoing
recitals are true and accurate and constitute part of this
Agreement to the same extent as if contained in the body
hereof.
2. Definitions.
In addition to the terms defined elsewhere in this Agreement: (a)
capitalized terms that are not otherwise defined herein have the
meanings given to such terms in the Obligations, and (b) the
following terms have the meanings set forth in this Section
1.1:
“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 under the Securities Act.
“Board of Directors” means
the board of directors of the Company.
“Common Stock” means the
common stock of the Company, par value $0.001 per share, and any
other class of securities into which such securities may hereafter
be reclassified or changed.
“Exchange Act” means the
Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.
“Liens” means a lien,
charge, pledge, security interest, encumbrance, right of first
refusal, preemptive right or other restriction.
“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.
“Securities” has the
meaning set forth in the Preamble of this Agreement.
“Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.
3. Exchange
and Satisfaction. The
Obligations will be exchanged for the Cash Payments (as defined
below), Securities and other considerations according to the
following terms and conditions and pursuant to the terms of this
Agreement:
a.
The Creditor will
receive $160,000 in cash payments (the “Cash Payments”)
according to the following schedule:
●
$20,000 on or
before May 30, 2020 (the “Initial Payment”);
and
●
$20,000 every
thirty (30) calendar days thereafter for seven consecutive calendar
months (a total of $140,000.00).
b.
In addition to the
Cash Payments, the Creditor will be entitled to convert a portion
of the Notes pursuant to the original terms of the Notes into
500,000 shares of the Company’s common stock (the
“First Shares”). The sale of the First Shares by the
Creditor shall be restricted until November 1, 2020, according to
the following schedule:
i.
200,000 shares
cannot be sold unless the market share price is above 15
cents.
ii.
150,000 shares
cannot be sold unless the marker share price is above 20
cents.
iii.
150,000 shares
cannot be sold unless the market share price is above 25
cents.
c.
On the Effective
Date, the Company shall issue to Creditor a common stock purchase
warrant for the purchase of 700,000 shares of the Company’s
common stock (the “Warrant”), a form of which us
attached hereto as Exhibit
B.
d.
For the avoidance
of doubt, the Creditor shall be subject to the beneficial ownership
limitations with respect to the Company’s common stock
provided in the Notes at all times.
e.
Notwithstanding
anything in this Agreement to the contrary, if the Company fails to
timely make any of the Cash Payments to Creditor and/or the Company
fails to comply with the terms of this Agreement, then Creditor may
declare this Agreement null and void and of no further force or
effect in Creditor’s sole discretion (provided , however,
that the Creditor shall retain all rights with respect to the
Warrant even if this Agreement is declared a null and void and of
no further force or effect).
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4. Representations
and Warranties of the Company. The Company hereby makes the following
representations and warranties to Creditor:
(a) Authorization; Enforcement. The
Company has the requisite corporate power and authority to enter
into and to consummate the transactions contemplated by this
Agreement and otherwise to carry out its obligations hereunder. The
execution and delivery of this Agreement by the Company and the
consummation by it of the transactions contemplated hereby and
thereby have been duly authorized by all necessary action on the
part of the Company and no further action is required by the
Company, the Board of Directors or the Company’s stockholders
in connection herewith or therewith. This Agreement have been (or
upon delivery will have been) duly executed by the Company and,
when delivered in accordance with the terms hereof and thereof,
will constitute the valid and binding obligations of the Company
enforceable against the Company in accordance with their terms,
except: (i) as limited by general equitable principles and
applicable bankruptcy, insolvency, reorganization, moratorium and
other laws of general application affecting enforcement of
creditors’ rights generally, (ii) as limited by laws relating
to the availability of specific performance, injunctive relief or
other equitable remedies and (iii) insofar as indemnification and
contribution provisions may be limited by applicable
law.
(b) Issuance of the Securities. The
Securities are duly authorized and, when issued and paid for in
accordance with this Agreement, will be duly and validly issued,
fully paid and nonassessable, free and clear of all Liens imposed
by the Company. The shares of Common Stock underlying the
Securities (if any), when issued in accordance with the terms of
the Securities, will be validly issued, fully paid and
nonassessable, free and clear of all Liens imposed by the Company
other than restrictions on transfer required by law. The
Creditor’s holding period with respect to such Securities and
the Common Stock underlying the Securities shall tack back to the
original acquisition date of the Obligations pursuant to Section
3(a)(9) of the Securities Act.
5. Representations
and Warranties of the Creditor. Creditor hereby represents
and warrants as of the date hereof and as of the Closing Date to
the Company as follows (unless as of a specific date
therein):
(a) Own
Account. Creditor understands that the Securities are
“restricted securities” and have not been registered
under the Securities Act or any applicable state securities law and
is acquiring the Securities as principal for its own account and
not with a view to or for distributing or reselling such Securities
or any part thereof in violation of the Securities Act or any
applicable state securities law, has no present intention of
distributing any of such Securities in violation of the Securities
Act or any applicable state securities law and has no direct or
indirect arrangement or understandings with any other persons to
distribute or regarding the distribution of such Securities in
violation of the Securities Act or any applicable state securities
law (this representation and warranty not limiting such
Creditor’s right to sell the Securities pursuant to a
registration statement or otherwise in compliance with applicable
federal and state securities laws). The Creditor is acquiring the
Securities hereunder in the ordinary course of its
business.
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(c) Creditor’s
Status. At the time the Creditor was offered the Securities,
it was, and as of the date hereof it is, an “accredited
investor” as defined in Rule 501(a) under the Securities
Act.
(d) Experience
of Creditor. Creditor, either alone or together with its
representatives, has such knowledge, sophistication and experience
in business and financial matters so as to be capable of evaluating
the merits and risks of the prospective investment in the
Securities, and has so evaluated the merits and risks of such
investment. Such Creditor is able to bear the economic risk of an
investment in the Securities and, at the present time, is able to
afford a complete loss of such investment.
6. Release.
The Creditor acknowledges and agrees that it shall have no further
rights or interest in, and shall not receive any further
consideration, payment or distribution of any kind with respect to,
the Obligations, except as provided in this Agreement. In such
regard, the Creditor hereby waives, relinquishes, remises and
releases all rights, claims, interests or liabilities, known and
unknown, of any nature whatsoever in law or equity which the
Creditor may previously have had or may now or hereafter have as
against or to receive from the Company arising out of, resulting
from or relating to the Obligations or any rights or interest of
the Creditor with respect thereto, except as provided in this
Agreement. The Company acknowledges and agrees that it shall have
no further rights or interest in, and shall not receive any further
consideration, payment or distribution of any kind with respect to,
the Obligations, except as provided in this Agreement. In such
regard, the Company hereby waives, relinquishes, remises and
releases all rights, claims, interests or liabilities, known and
unknown, of any nature whatsoever in law or equity which the
Company may previously have had or may now or hereafter have as
against or to receive from the Creditor arising out of, resulting
from or relating to the Obligations or any rights or interest of
the Company with respect thereto, except as provided in this
Agreement
7. Transfer
Restrictions. The Securities may only be disposed of in
compliance with state and federal securities laws. In connection
with any transfer of Securities other than pursuant to an effective
registration statement or Rule 144 under the Securities Act or
other applicable exemption, the Company may require the transferor
thereof to provide to the Company an opinion of counsel selected by
the Creditor, the form and substance of which opinion shall be
reasonably satisfactory to the Company, to the effect that such
transfer does not require registration of such transferred
Securities under the Securities Act.
8. Further
Assurances. The
Creditor shall hereafter, without further consideration, execute
and deliver promptly to the Company such further consents, waivers,
assignments, endorsements and other documents and instruments, and
to take all such further actions, as the Company may from time to
time reasonably request with respect to the Exchange and
satisfaction of the Obligations and the consummation in full
thereof. The Company shall hereafter, without further
consideration, execute and deliver promptly to the Creditor such
further consents, waivers, assignments, endorsements and other
documents and instruments, and to take all such further actions, as
the Creditor may from time to time reasonably request with respect
to the Exchange and satisfaction of the Obligations and the
consummation in full thereof.
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9. Successors
and Assigns. This
Agreement is binding upon, and shall inure to the benefit of, the
parties hereto and their respective successors and assigns,
provided, however, that any assignment of the rights and benefits
hereunder by the Company must be agreed to in a signed writing by
the Creditor.
10. Counterparts.
This Agreement may be executed in multiple counterparts, each of
which shall be deemed an original and all of which, when taken
together, shall constitute one and the same
instrument.
IN
WITNESS WHEREOF, the parties hereto have affixed their hands and
seals by signing this Agreement as of the day and year first above
written.
Company:
GUIDED
THERAPEUTICS, INC.
By:
/Xxxx X. Xxxxxxxxxx
Name:
Xxxx X. Xxxxxxxxxx
Title:
President and CEO
Creditor:
Auctus
Fund, LLC
By:
/Xxx Xxxxxx
Name:
Xxx Xxxxxx
Title:
Managing Director
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Exhibit
A
1.
That certain
convertible promissory note in the original principal amount of
$150,000.00 dated March 20, 2018
2.
That certain
convertible promissory note in the original principal amount of
$89,250.00 dated July 3, 2018.
3.
That certain
convertible promissory note in the original principal amount of
$65,000.00 dated March 29, 2019.
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Exhibit
B
(see
attached)
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