Attached files
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S-1/A - FORM S-1/A AMENDMENT NO. 4 - GUIDED THERAPEUTICS INC | gthps1a221238411217.htm |
EX-23.1 - CONSENTS OF EXPERTS AND COUNSEL - GUIDED THERAPEUTICS INC | ex23one.htm |
EX-10.48 - MATERIAL CONTRACTS - GUIDED THERAPEUTICS INC | ex10fortyeight.htm |
EX-10.47 - MATERIAL CONTRACTS - GUIDED THERAPEUTICS INC | ex10fortyseven.htm |
EX-5.1 - OPINION ON LEGALITY - GUIDED THERAPEUTICS INC | ex5one.htm |
EX-4.32 - INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES INSTRU - GUIDED THERAPEUTICS INC | ex4thirtytwo.htm |
Exhibit 3.3
GUIDED THERAPEUTICS, inc.
CERTIFICATE OF DESIGNATION OF PREFERENCES,
RIGHTS AND LIMITATIONS
OF
SERIES D CONVERTIBLE PREFERRED STOCK
RIGHTS AND LIMITATIONS
OF
SERIES D CONVERTIBLE PREFERRED STOCK
PURSUANT TO SECTION 151 OF
THE
Delaware GENERAL CORPORATION LAW
Delaware GENERAL CORPORATION LAW
The undersigned, Dr. Gene S. Cartwright, does hereby certify
that:
1. He is the President and Chief Executive Officer of Guided
Therapeutics, Inc., a Delaware corporation (the
“Corporation”).
2. The Corporation is authorized to issue 5,000,000 shares of
preferred stock.
3. The following resolutions were duly adopted by the board of
directors of the Corporation (the “Board”):
WHEREAS, the certificate of incorporation of the Corporation
provides for a class of its authorized stock known as preferred
stock, consisting of 5,000,000 shares, $0.001 par value per share,
issuable from time to time in one or more series;
WHEREAS, the Board 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, 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 (as defined in Schedule 1 hereto), up to 5,000 shares of
the preferred stock which the Corporation has the authority to
issue, as follows:
NOW, THEREFORE, BE IT RESOLVED, that the Board 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 set forth in
Schedule 1 hereto.
RESOLVED, FURTHER, that the Chairman, 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 day of , 2017.
__________________________________________
Name: Gene S. Cartwright
Title: President and Chief Executive Officer
|
Schedule 1
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.
“Alternate Consideration” has the meaning set
forth in Section 7(c).
“Beneficial Ownership Limitation” has the
meaning set forth in Section 6(e).
“Board” means the Corporation’s Board of
Directors.
“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.
“Buy-In” has the meaning set forth in Section
6(d)(v).
“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 its subsidiaries that 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 Date” has the meaning set forth in
Section 6(a).
“Conversion Price” has the meaning set forth in
Section 6(c).
“Conversion Shares” means the shares of Common
Stock issuable upon conversion of the shares of Preferred Stock in
accordance with the terms hereof.
“Dividend Payment Date” shall have the meaning
set forth in Section 3(a).
“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) the Corporation
shall have paid all liquidated damages and other amounts owing to
the applicable Holder in respect of the Preferred Stock, (c)(i)
there is an effective registration statement pursuant to which
either (A) the Corporation may issue Conversion Shares or (B) the
Holders are permitted to utilize the prospectus thereunder to
resell all of the shares of Common Stock issuable pursuant to the
Transaction Documents (and the Corporation believes, in good faith,
that such effectiveness will continue uninterrupted for the
foreseeable future); (ii) all of the Conversion Shares issuable
pursuant to the Transaction Documents (and shares issuable in lieu
of cash payments of dividends) may be resold pursuant to Rule 144
without volume or manner-of-sale restrictions or current public
information requirements as determined by the Corporation; or (iii)
all of the Conversion Shares may be issued to the Holder pursuant
to Section 3(a)(9) of the Securities Act and immediately resold
without restriction, (d) the Common Stock is trading on the 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 the Trading Market will continue uninterrupted for
the foreseeable future), (e) 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 Transaction Documents, (f) the issuance of the shares in
question to the applicable Holder would not violate the Beneficial
Ownership Limitation, (g) there has been no public announcement of
a pending or proposed Fundamental Transaction or Change of Control
Transaction that has not been consummated, and (h) the applicable
Holder is not in possession of any information provided by the
Corporation that constitutes, or may constitute, material
non-public information.
“Exchange Act” means the Securities Exchange Act
of 1934, as amended, and the rules and regulations promulgated
thereunder.
“Exempt Issuance” shall mean any issuance of
Common Stock (or Common Stock Equivalents) (a) upon the conversion
of, or dividends or distributions on, any Common Stock Equivalents
outstanding as of the date of the Purchase Agreement, provided that
such Common Stock Equivalents have not been amended since the date
of the Purchase Agreement to increase the number of underlying
securities or to decrease the exercise price, exchange price or
conversion price of such securities (other than automatically
pursuant to their terms); (b) to employees or directors of, or
consultants to, the Corporation upon approval by the Board or under
a stock plan approved by the Board (not including the reissuance of
shares repurchased by the Corporation from employees of the
Corporation); (c) pursuant to the Purchase Agreement, or upon
conversion or exercise of any Common Stock Equivalents issued
pursuant to the Purchase Agreement, as applicable; (d) to any
existing holder of the Corporation’s securities as of the
date of the Purchase Agreement that do not exceed $150,000 of
Common Stock in the aggregate, which issuances are for the purpose
of obtaining benefits and/or waivers from such holder and not for
financing purposes; (e) in full or partial consideration in
connection with a bona fide strategic merger, acquisition,
consolidation or purchase of all or substantially all of the
securities or assets of a corporation or other entity, so long as
such issuance is not for the primary purpose of raising capital by
the Corporation; (f) in connection with a bona fide strategic
license agreement, sponsored research agreement, collaboration
agreement, development agreement, OEM agreement, marketing or
distribution agreement, or other bona fide partnering arrangement,
so long as such issuance is not for the primary purpose of raising
capital by the Corporation; (g) to a bank or other financial
institution pursuant to a bona fide commercial debt financing or to
equipment lessor pursuant to a bona fide equipment leasing
agreement; (h) pursuant to a registered public offering; or
(i) upon a stock split, stock dividend or subdivision of the
Common Stock.
“Existing Preferred Stock” means the outstanding
shares of Series C Convertible Preferred Stock of the
Corporation.
“Forced Conversion Amount” means the sum of (a)
100% of the aggregate Stated Value then outstanding, (b) accrued
but unpaid dividends and (c) all liquidated damages and other
amounts due in respect of the Preferred Stock.
“Forced Conversion Date” has the meaning set
forth in Section 6(b).
“Forced Conversion Notice” has the meaning set
forth in Section 6(b).
“Forced Conversion Notice Date” has the meaning
set forth in Section 6(b).
“Fundamental Transaction” has the meaning set
forth in Section 7(c).
“Holder” has 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.
“Liquidation” has the meaning set forth in
Section 5.
“Notice of Conversion” has the meaning set forth
in Section 8(a).
“Optional Redemption” has the meaning set forth
in Section 8(a).
“Optional Redemption Amount” has the meaning set
forth in Section 8(a) or Section 8(b), as
applicable.
“Optional Redemption Date” has the meaning set
forth in Section 8(a).
“Optional Redemption Notice” has the meaning set
forth in Section 8(a).
“Optional Redemption Notice Date” has the
meaning set forth in Section 8(a).
“Optional Redemption Period” has the meaning set
forth in Section 8(a).
“Original Issue Date” means the original issue
date of the 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” has the meaning set forth in
Section 2.
“Purchase Agreement” means the Securities
Purchase Agreement, dated as of
[ ],
2017, among the Corporation 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.
“Stated Value” has the meaning set forth in
Section 2.
“Successor Entity” has the meaning set forth in
Section 7(e).
“Supermajority Interest” at any time means the
holders of not less than two-thirds of the then-total outstanding
shares of Preferred Stock.
“Threshold Period” has the meaning set forth in
Section 6(b).
“Trading Day” means a day on which the Trading
Market is open for trading, or if the Common Stock is not listed or
quoted on any Trading Market, “Trading Day” means a
“Business Day”.
“Trading Market” means the principal trading
market on which the Common Stock is primarily listed or quoted for
trading.
“Transfer Agent” means Computershare Trust
Company, N.A., the current transfer agent of the Company, with a
mailing address of 250 Royall Street, Canton, Massachusetts 02021
and a facsimile number of (303) 262-0610, and any successor
transfer agent of the Company.
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 5,000 (which shall not be subject to increase without the
written consent of all of the holders of the Preferred Stock (each,
a “Holder” and collectively, the
“Holders”)). Each share of Preferred Stock shall
have a par value of $0.001 per share and a stated value equal to
$1,000 (the “Stated Value”).
Section 3.
Dividends.
(a)
Accrual and Payment of
Dividends. From and after the Original Issue Date until the
second anniversary of the Original Issue Date, cumulative dividends
on shares of Preferred Stock shall accrue, whether or not declared
by the Board and whether or not there are funds legally available
for the payment of dividends, on a daily basis in arrears at the
rate of 12% per year on the Stated Value thereof. All accrued
dividends on any shares of Preferred Stock shall be paid in cash,
only when, as and if declared by the Board out of funds legally
available therefor or upon a liquidation or redemption of the
Preferred Stock in accordance with the provisions of Section
5 or Section 8; provided that to the extent not paid on
the last day of March, June, September and December of each
calendar year (each such date, a “Dividend Payment
Date”), all accrued dividends on any share shall
accumulate on the applicable Dividend Payment Date whether or not
declared by the Board and shall remain accumulated dividends until
paid pursuant hereto or converted pursuant to Section 6. All
accrued and accumulated dividends on the shares of Preferred Stock
shall be prior and in preference to any dividend on any Junior
Securities and shall be fully declared and paid before any
dividends are declared and paid, or any other distributions or
redemptions are made, on any Junior Securities, other than to (a)
declare or pay any dividend or distribution payable on the Common
Stock in shares of Common Stock or (b) repurchase Common Stock held
by employees or consultants of the Corporation upon termination of
their employment or services pursuant to agreements providing for
such repurchase.
(b)
Participating Dividends.
Subject to Section 3(a), in addition to the dividends
accruing on the Preferred Stock pursuant to Section 3(a), if
the Corporation declares or pays a dividend or distribution on the
Common Stock, whether such dividend or distribution is payable in
cash, securities or other property, including the purchase or
redemption by the Corporation or any of its subsidiaries of shares
of Common Stock for cash, securities or property, but excluding (i)
any dividend or distribution payable on the Common Stock in shares
of Common Stock and (ii) any repurchases of Common Stock held by
employees or consultants of the Corporation upon termination of
their employment or services pursuant to agreements providing for
such repurchase, the Corporation shall simultaneously declare and
pay a dividend on the Preferred Stock on a pro rata basis with the
Common Stock determined on an as-converted basis assuming all
Shares had been converted pursuant to Section 6 as of
immediately prior to the record date of the applicable dividend (or
if no record date is fixed, the date as of which the record holders
of Common Stock entitled to such dividends are to be
determined).
(c)
Partial Dividend Payments.
Except as otherwise provided herein, if at any time the Corporation
pays less than the total amount of dividends then accrued and
accumulated with respect to the Preferred Stock, such payment shall
be distributed pro rata among the holders thereof based upon the
aggregate accrued and accumulated but unpaid dividends on the
shares of Preferred Stock held by each such holder.
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 special rights
given to the Preferred Stock or (b) alter or amend this Certificate
of Designation.
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
after any distribution or payment to the holders of the Existing
Preferred Stock and 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.
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 at the option of the Holder thereof, into that number of
shares of Common Stock (subject to the Beneficial Ownership
Limitation) determined by dividing the sum of the Stated Value of
such share of Preferred Stock plus all accrued but unpaid dividends
thereon and all liquidated damages and other amounts due in respect
thereof, 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. 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.
Subject to Section 9(i), 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)
Forced Conversion. Subject to
the provisions of this Section 6, (i) if (A) the VWAP for 20
of 30 consecutive Trading Days (“Threshold
Period”), exceeds 200% of the then effective Conversion
Price and (B) the daily dollar trading volume for each Trading Day
during any Threshold Period exceeds $200,000 per Trading Day, the
Corporation may, within ten Trading Days after the end of any such
Threshold Period; or (ii) the holders of not less than a
Supermajority Interest may instruct the Corporation to, deliver a
written notice to all Holders (a “Forced Conversion
Notice” and the date such notice is delivered to all
Holders, the “Forced Conversion Notice Date”) to
cause each Holder to convert all or part of such Holder’s
Preferred Stock (as specified in such Forced Conversion Notice)
plus all accrued but unpaid dividends thereon and all liquidated
damages and other amounts due in respect of the Preferred Stock,
pursuant to Section 6(a), it being agreed that the
“Conversion Date” for purposes of Section 6
shall be deemed to occur on the third Trading Day following the
Forced Conversion Notice Date (such third Trading Day, the
“Forced Conversion Date”). In the case of clause
(i) of this Section 6(b) only, the Corporation may not
deliver a Forced Conversion Notice, and any Forced Conversion
Notice delivered by the Corporation shall not be effective, unless
all of the Equity Conditions have been met on each Trading Day
during the applicable Threshold Period. Any Forced Conversion
Notices shall be applied ratably to all of the Holders based on
each Holder’s initial purchases of Preferred Stock hereunder,
provided that any voluntary conversions by a Holder shall be
applied against such Holder’s pro rata allocation,
thereby decreasing the aggregate amount forcibly converted
hereunder if less than all shares of the Preferred Stock are
forcibly converted.
(c)
Conversion Price. The
conversion price for the Preferred Stock shall equal $_____,
subject to adjustment herein (the “Conversion
Price”).
(d)
Mechanics of
Conversion
(i)
Delivery of Certificate Upon
Conversion. Certificates for Conversion Shares shall be
transmitted by the Transfer Agent to the Holder by crediting the
account of the Holder’s prime broker with the Depository
Trust Company through its Deposit or Withdrawal Agent at Custodian
system (DWAC) if the Company is then a participant in such system
and there is an effective Registration Statement permitting the
issuance of the Conversion Shares to or resale of the Conversion
Shares by Holder, and otherwise by physical delivery to the address
specified by the Holder in the Notice of Exercise by the date that
is three Trading Days after such Conversion Date.
(ii)
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 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 be issuable (taking into account the
adjustments and restrictions of Section 7) upon the
conversion of the then-outstanding shares of Preferred Stock. The
Corporation covenants that all shares of Common Stock that shall be
so issuable shall, upon issue, be duly authorized, validly issued,
fully paid and nonassessable.
(iii)
Fractional Shares of Common
Stock. 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 receive 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.
(iv)
Obligation Absolute; Partial
Liquidated Damages. Subject to the Beneficial Ownership
Limitation, 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. In the event a Holder
shall elect to convert any or all of the Stated Value of its
Preferred Stock, the Corporation may not refuse conversion based on
any claim that such Holder or anyone associated or affiliated with
such Holder has been engaged in any violation of law, agreement or
for any other reason, unless an injunction from a court, on notice
to Holder, restraining and/or enjoining conversion of all or part
of the Preferred Stock of such Holder shall have been sought and
obtained, and the Corporation posts a surety bond for the benefit
of such Holder in the amount of 150% of the Stated Value of
Preferred Stock which is subject to the injunction, which bond
shall remain in effect until the completion of
arbitration/litigation of the underlying dispute and the proceeds
of which shall be payable to such Holder to the extent it obtains
judgment. In the absence of such injunction, the Corporation shall
issue Conversion Shares and, if applicable, cash, upon a properly
noticed conversion. If the Corporation fails to deliver to a Holder
such Conversion Shares pursuant to Section 6(d)(i) on the
second Trading Day after the Share Delivery Date applicable to such
conversion, the Corporation shall pay to such Holder, in cash, as
liquidated damages and not as a penalty, for each $5,000 of Stated
Value of Preferred Stock being converted, $25 per Trading Day for
each Trading Day after such second Trading Day after the Share
Delivery Date until such Conversion Shares are delivered or Holder
rescinds such conversion. Nothing herein shall limit a
Holder’s right to pursue actual damages for the
Corporation’s failure to deliver Conversion Shares within the
period specified herein and such Holder shall have the right to
pursue all remedies available to it hereunder, at law or in equity
including, without limitation, a decree of specific performance
and/or injunctive relief. The exercise of any such rights shall not
prohibit a Holder from seeking to enforce damages pursuant to any
other Section hereof or under applicable law.
(v)
Compensation for Buy-In on Failure
to Timely Deliver Conversion Shares Upon Conversion. In
addition to any other rights available to the Holder, if the
Corporation fails for any reason to deliver to a Holder the
applicable Conversion Shares by the Share Delivery Date pursuant to
Section 6(d)(i), and if after such Share Delivery Date such
Holder is required by its brokerage firm to purchase (in an open
market transaction or otherwise), or the Holder’s brokerage
firm otherwise purchases, shares of Common Stock to deliver in
satisfaction of a sale by such Holder of the Conversion Shares
which such Holder was entitled to receive upon the conversion
relating to such Share Delivery Date (a
“Buy-In”), then the Corporation shall (A) pay in
cash to such Holder (in addition to any other remedies available to
or elected by such Holder) the amount, if any, by which (x) such
Holder’s total purchase price (including any brokerage
commissions) for the Common Stock so purchased exceeds (y) the
product of (1) the aggregate number of shares of Common Stock that
such Holder was entitled to receive from the conversion at issue
multiplied by (2) the actual sale price at which the sell order
giving rise to such purchase obligation was executed (including any
brokerage commissions) and (B) at the option of such Holder, either
reissue (if surrendered) the shares of Preferred Stock equal to the
number of shares of Preferred Stock submitted for conversion (in
which case, such conversion shall be deemed rescinded) or deliver
to such Holder the number of shares of Common Stock that would have
been issued if the Corporation had timely complied with its
delivery requirements under Section 6(d)(i). For example, if
a Holder purchases shares of Common Stock having a total purchase
price of $11,000 to cover a Buy-In with respect to an attempted
conversion of shares of Preferred Stock with respect to which the
actual sale price of the Conversion Shares (including any brokerage
commissions) giving rise to such purchase obligation was a total of
$10,000 under clause (A) of the immediately preceding sentence, the
Corporation shall be required to pay such Holder $1,000. The Holder
shall provide the Corporation written notice indicating the amounts
payable to such Holder in respect of the Buy-In and, upon request
of the Corporation, evidence of the amount of such loss. Nothing
herein shall limit a Holder’s right to pursue any other
remedies available to it hereunder, at law or in equity including,
without limitation, a decree of specific performance and/or
injunctive relief with respect to the Corporation’s failure
to timely deliver the Conversion Shares upon conversion of the
shares of Preferred Stock as required pursuant to the terms
hereof.
(vi)
Transfer Taxes. The issuance
of certificates for shares of the Common Stock on conversion of
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 certificates, 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 certificate 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
certificates 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.
(e)
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(e), 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(e) 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(e), 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 two Trading Days
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(e) 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(e) 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(e) 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. The limitations contained in this paragraph
shall not apply to any Holder that, immediately prior to acquiring
any shares of Preferred Stock, beneficially owned more than 4.99%
of the outstanding Common Stock.
Section 7.
Certain
Adjustments.
(a)
Stock Dividends and Stock
Splits. If the Corporation, at any time while 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, 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)
Subsequent Equity Sales. Until
the earlier of (i) the date immediately following the period of any
20 of 30 consecutive Trading Days wherein (A) the VWAP for each
Trading Day during such period exceeds 200% of the then-effective
Conversion Price and (B) the daily dollar trading volume for each
Trading Day during such period exceeds $200,000 per Trading Day;
and (ii) the Common Stock is first listed on a national securities
exchange registered with the SEC under Section 6 of the Exchange
Act (at which such earlier date this Section 7(b) shall no longer
be applicable) if, without the consent of a majority of the
then-outstanding shares of Preferred Stock, the Corporation sells
or grants any option to purchase or sells or grants any right to
reprice, or otherwise disposes of or issues (or announces any sale,
grant or any option to purchase or other disposition), any Common
Stock or Common Stock Equivalents entitling any Person to acquire
shares of Common Stock at an effective price per share that is
lower than the then Conversion Price (such lower price, the
“Base Conversion Price” and such issuance, a
“Dilutive Issuance”), then the Conversion Price
shall be reduced to equal the Base Conversion Price. Such
adjustment shall be made whenever such Common Stock or Common Stock
Equivalents are issued. Notwithstanding the foregoing, no
adjustment will be made under this Section 7(b) in respect
of an Exempt Issuance, and under no circumstances may the
Conversion Price be lower than the par value of the Common
Stock.
(c)
Subsequent Rights Offerings.
In addition to any adjustments pursuant to Section 7(a) above, if
at any time the Corporation grants, issues or sells any Common
Stock Equivalents or rights to purchase stock, warrants, securities
or other property pro rata to the record holders of any class of
shares of Common Stock (the “Purchase Rights”),
then the Holder of will be entitled to acquire, upon the terms
applicable to such Purchase Rights, the aggregate Purchase Rights
which the Holder could have acquired if the Holder had held the
number of shares of Common Stock acquirable upon complete
conversion of such Holder’s Preferred Stock (without regard
to any limitations on exercise hereof, including without
limitation, the Beneficial Ownership Limitation) immediately before
the date on which a record is taken for the grant, issuance or sale
of such Purchase Rights, or, if no such record is taken, the date
as of which the record holders of shares of Common Stock are to be
determined for the grant, issue or sale of such Purchase Rights
(provided, however, to the extent that the Holder’s right to
participate in any such Purchase Right would result in the Holder
exceeding the Beneficial Ownership Limitation, then the Holder
shall not be entitled to participate in such Purchase Right to such
extent (or beneficial ownership of such shares of Common Stock as a
result of such Purchase Right to such extent) and such Purchase
Right to such extent shall be held in abeyance for the Holder until
such time, if ever, as its right thereto would not result in the
Holder exceeding the Beneficial Ownership Limitation).
(d)
Pro Rata Distributions. During
such time as this Preferred Stock is outstanding, if the
Corporation shall declare or make any dividend or other
distribution of its assets (or rights to acquire its assets) to
holders of shares of Common Stock, by way of return of capital or
otherwise (including, without limitation, any distribution of cash,
stock or other securities, property or options by way of a
dividend, spin off, reclassification, corporate rearrangement,
scheme of arrangement or other similar transaction) (a
“Distribution”), at any time after the issuance
of this Preferred Stock, then, in each such case, the Holder shall
be entitled to participate in such Distribution to the same extent
that the Holder would have participated therein if the Holder had
held the number of shares of Common Stock acquirable upon complete
conversion of this Preferred Stock (without regard to any
limitations on conversion hereof, including without limitation, the
Beneficial Ownership Limitation) immediately before the date of
which a record is taken for such Distribution, or, if no such
record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the participation in such
Distribution (provided, however, to the extent that
the Holder's right to participate in any such Distribution would
result in the Holder exceeding the Beneficial Ownership Limitation,
then the Holder shall not be entitled to participate in such
Distribution to such extent (or in the beneficial ownership of any
shares of Common Stock as a result of such Distribution to such
extent) and the portion of such Distribution shall be held in
abeyance for the benefit of the Holder until such time, if ever, as
its right thereto would not result in the Holder exceeding the
Beneficial Ownership Limitation).
(e)
Fundamental Transaction. If,
at any time while 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, (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 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(e)), 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 Preferred Stock is convertible
immediately prior to such Fundamental Transaction (without regard
to any limitation in Section 6(e)). 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
Preferred Stock following such Fundamental Transaction. To the
extent necessary to effectuate the foregoing provisions, any
successor to the Corporation or surviving entity in such
Fundamental Transaction shall file a new Certificate of Designation
with the same terms and conditions and issue to the Holders new
preferred stock consistent with the foregoing provisions and
evidencing the Holders’ right to convert such preferred stock
into Alternate Consideration. The Corporation shall cause any
successor entity in a Fundamental Transaction in which the
Corporation is not the survivor (the “Successor
Entity”) to assume in writing all of the obligations of
the Corporation under this Certificate of Designation and the other
Transaction Documents (as defined in the Purchase Agreement) in
accordance with the provisions of this Section 7(e) pursuant
to written agreements in form and substance reasonably satisfactory
to the Holder and approved by the Holder (without unreasonable
delay) prior to such Fundamental Transaction and shall, at the
option of the holder of this Preferred Stock, deliver to the Holder
in exchange for this Preferred Stock a security of the Successor
Entity evidenced by a written instrument substantially similar in
form and substance to this Preferred Stock which is convertible for
a corresponding number of shares of capital stock of such Successor
Entity (or its parent entity) equivalent to the shares of Common
Stock acquirable and receivable upon conversion of this Preferred
Stock (without regard to any limitations on the conversion of this
Preferred Stock) prior to such Fundamental Transaction, and with a
conversion price which applies the conversion price hereunder to
such shares of capital stock (but taking into account the relative
value of the shares of Common Stock pursuant to such Fundamental
Transaction and the value of such shares of capital stock, such
number of shares of capital stock and such conversion price being
for the purpose of protecting the economic value of this Preferred
Stock immediately prior to the consummation of such Fundamental
Transaction), and which is reasonably satisfactory in form and
substance to the Holder. Upon the occurrence of any such
Fundamental Transaction, the Successor Entity shall succeed to, and
be substituted for (so that from and after the date of such
Fundamental Transaction, the provisions of this Certificate of
Designation and the other Transaction Documents referring to the
“Corporation” shall refer instead to the Successor
Entity), and may exercise every right and power of the Corporation
and shall assume all of the obligations of the Corporation under
this Certificate of Designation and the other Transaction Documents
with the same effect as if such Successor Entity had been named as
the Corporation herein.
(f)
Calculations. All calculations
under this Section 7 shall be made to the nearest cent or
the nearest 1/100th 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.
(g)
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 a notice setting forth the
Conversion Price after such adjustment and setting forth a brief
statement of the facts requiring such adjustment. Whether or not
the Corporation provides such notice, upon the occurrence of any
adjustment pursuant to any provision of this Section 7, the
Holders are entitled to receive a number of Conversion Shares based
upon adjusted Conversion Price upon a conversion occurring on or
after the date of such adjustment, regardless of whether a Holder
accurately refers to the adjusted Conversion Price in the Notice of
Conversion.
(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.
(a)
At Election of Corporation. At
any time after the date hereof, the Corporation may deliver a
notice to the Holder (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 sum of (a) 120% of the then-outstanding Stated Value of the
Preferred Stock, (b) accrued but unpaid dividends and (c) all
liquidated damages and other amounts due in respect of the
Preferred Stock (such amount, the “Optional Redemption
Amount”) on the 20th 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.
(b)
At Election of Supermajority
Interest. At any time after the second anniversary of the
Original Issue Date, the holders of not less than a Supermajority
Interest may deliver a notice to the Corporation of their
irrevocable election to cause the Corporation to deliver an
Optional Redemption Notice pursuant to Section 8(a) for the
redemption of not less than all of the then-outstanding Preferred
Stock; provided that, notwithstanding anything to the contrary in
Section 8(a), the Optional Redemption Amount for purposes of
this Section 8(b) shall be the sum of (a) 100% of the
then-outstanding Stated Value of the Preferred Stock, (b) accrued
but unpaid dividends and (c) all liquidated damages and other
amounts due in respect of the Preferred Stock.
(c)
Redemption Procedure. The
payment of cash pursuant to an Optional Redemption shall be payable
on the Optional Redemption Date. Notwithstanding anything to the
contrary in this Section 8, the Corporation’s
determination to redeem shares of Preferred Stock under Section
8(a) shall be applied ratably among the Holders of the
Preferred Stock. Any Holder may elect to convert its Preferred
Stock pursuant to Section 6 prior to the Optional Redemption
Date by the delivery of a Notice of Conversion to the
Corporation.
(d)
Surrender of Certificates. On
or before the Optional Redemption Date, each of the Holders, unless
such Holder has exercised his, her or its right to convert such
Preferred Stock as provided in Section 6, shall surrender
the certificate or certificates representing such Preferred Stock
(or, if such Holder alleges that such certificate has been lost,
stolen or destroyed, a lost certificate affidavit and agreement
reasonably acceptable to the Corporation to indemnify the
Corporation against any claim that may be made against the
Corporation on account of the alleged loss, theft or destruction of
such certificate) to the Corporation, in the manner and at the
place designated in the Optional Redemption Notice, and thereupon
the Optional Redemption Amount for such Preferred Stock shall be
payable to the order of the person whose name appears on such
certificate or certificates as the owner thereof. In the event less
than all of the shares of Preferred Stock represented by a
certificate are redeemed, a new certificate representing the
unredeemed shares of Preferred Stock shall promptly be issued to
such Holder.
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 sent
by a nationally recognized overnight courier service, addressed to
the Corporation, at 5835 Peachtree Corners East, Suite D, Norcross,
Georgia 30092, Attention: Investor Relations, facsimile number
(770) 242-8639, or such other facsimile number or address as
the Corporation may specify for such purposes by notice to the
Holders delivered in accordance with this Section 9. 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 sent by a nationally recognized
overnight courier service addressed to each Holder at the facsimile
number or address of such Holder appearing on the books of the
Corporation. 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 set forth in this
Section 9 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 set forth in this Section 9 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.
(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)
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.
(e)
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.
(f)
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.
(g)
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.
(h)
Status of Converted or Redeemed
Preferred Stock. If any shares of Preferred Stock shall be
converted, redeemed or reacquired by the Corporation, such shares
shall resume the status of authorized but unissued shares of
preferred stock and shall no longer be designated as Series D
Convertible Preferred Stock.
* * * * * * * * * * * *
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 pursuant to which the
Preferred Stock was issued. 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
Price:_________________________________________________
Number of shares of Preferred Stock subsequent to
Conversion:_____________________
Address for Delivery:
_______________________________________________________
Or
DWAC Instructions:
Broker No.:______________________
Account No.: _____________________
[HOLDER]
By:____________________________________
Name:_________________________________
Title:__________________________________