On October 12, 2016, the Company entered into a Termination Agreement with Memcine, the University of Iowa Research Foundation, and Dr. Tony Vanden Bush. Pursuant to the termination agreement, the Company terminated and cancelled all of its interest in Memcine, terminated the shareholder agreement of Memcine, and John Krohn and Cristopher Grunewald resigned as officers and directors of Memcine.
On October 18, 2016, the Company entered into a Forbearance and Refinancing Agreement (the Refinancing Agreement) with K4 to refinance certain financial instruments. Pursuant to the Refinancing Agreement, the Company and K4 agreed as follows:
|The December 31, 2015 Convertible Note in the principal amount of $2.5 million was cancelled and replaced with a new Amended and Restated Convertible Note in the principal amount of $2.5 million (the Amended Note). The warrants previously issued pursuant to the December 31, 2015 Convertible Note remain in effect. The material terms of the Amended Note include: interest at the rate of 8% per annum, which shall begin to accrue on January 1, 2017; Company may prepay the Amended Note (a) on or before December 31, 2017, with consent, which consent cannot be unreasonably withheld, for such purposes, including but not limited to a Nasdaq listing of the Companys securities, or as a condition to an equity financing, and (b) at any time after December 31, 2017 upon 30 days written notice by the Company; principal amount and interest may be converted into shares of common stock of the Company at a discount of 15% of the average price of the common stock of the Company during the 20 consecutive trading days immediately prior to such conversion, but not less than $0.75; and the maturity date is December 31, 2021.|
|·||Repayment of a $700,000 loan (termination of all related loan documents) was waived.|
|·||The Company agreed to issue 4,000,000 shares of common stock, with standard restrictive legend.|
|·||The following warrants to purchase shares of common stock of the Company were terminated:|
|Issuance Date||Expiration Date||Exercise Price||# Warrants / Shares|
|10/05/2013||10/05/2016||$1.46 / share||120,000|
|10/05/2013||10/05/2017||$1.46 / share||120,000|
|10/05/2013||10/05/2018||$1.46 / share||120,000|
|12/31/2015||12/31/2018||$1.00 / share||300,000|
|12/31/2015||12/31/2018||$1.25 / share||200,000|
|·||The Company issued warrants to purchase shares of common stock of the Company as follows:|
|Expiration Date||Exercise Price / Share||# Warrants / Shares|
On October 26, 2016, the Company invested $200,000 with the potential to invest an additional $1.3 million dollars, in Solx, Inc. (Solx), a privately-held medical device company. Solx is dedicated to developing and commercializing innovative surgical technologies that threat refectory and moderate glaucoma and preserve vision.
On October 26, 2016, the Company entered into a restructuring term sheet with K4, whereby K4 agreed to attempt to (i) re-negotiate and assume certain payments owed to two third parties (the Debt Service), and (ii) re-negotiate and assume the $752,325 and $250,975 outstanding Letters of Credit with Denver Savings Bank (collectively the LOCs), prior to January 31, 2017. If K4 renegotiates and assumes the Debt Service and the LOCs, the Company will, on the closing date, issue to K4 a Convertible Promissory Note with the principal balance equal to the sum of (i) the principal balance outstanding on the LOCs as of the closing date, and (ii) the Debt Service as of the closing date. The Convertible Promissory Note will be converted into shares of common stock of the Company as follows: if converted within 120 days following issuance, at a rate of 65% of the average trading price of the Companys for the period beginning on and including September 1, 2016 and ending the day before the issuance date, or (ii) $0.55 per share; and if converted after the 120th day following the issuance date thereof, at a rate of 65% of the average price of the common stock of the Company during the 20 consecutive trading days immediately prior to such conversion, but not less than $0.55 per share. The Company will, as additional consideration for the refinancing, issue K4 a warrant to purchase 1,875,000 shares of common stock of the Company at an exercise price of $1.20 per share, expiring December 31, 2018.
In November 2016, the Company converted Caretta Therapeutics, Inc. from a corporation to a limited liability company.
The above information was disclosed in a filing to the SEC. To see the filing, click here.
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