Lucid Diagnostics : Private Placement - Form 8-K

Item 3.02.

Unregistered Sales of Equity Securities.

Effective as ofOctober 17, 2023, Lucid Diagnostics Inc. (the "Company") entered into subscription agreements (each, a "Subscription Agreement") with certain accredited investors for the sale of 5,000 shares of the Company's newly designated Series A-1 Convertible Preferred Stock, par value $0.001 per share (the "Series A-1 Preferred Stock"), at a purchase price of $1,000 per share, for aggregate gross proceeds to the Company of $5.0 million. The closing of the sale occurred on October 18, 2023. In connection with the sale, on the day of the closing (the "Effective Date"), the Company filed a Certificate of Designation of Preferences, Rights and Limitations of the Series A-1 Preferred Stock with the Secretary of State of the State of Delaware (the "Certificate of Designation"). The key terms of the Series A-1 Preferred Stock (which, other than with respect to the conversion price, are substantially identical to the key terms of the Company's Series A Convertible Preferred Stock, par value $0.001 per share (the "Series A Preferred Stock"), that was issued in March 2023) are as follows:

Conversion. Each share of Series A-1 Preferred Stock is convertible at the option of the holder, from and after the six-month anniversary of its issuance (or, if later, the effective date of a registration statement covering the resale of the conversion shares), and subject to certain beneficial ownership limitations as set forth in the Certificate of Designation and described below, into such number of shares of the Company's common stock, par value $0.001 per share (the "Common Stock"), as is equal to the number of shares of Series A-1 Preferred Stock to be converted, multiplied by the stated value of $1,000 (the "Stated Value"), divided by the conversion price in effect at the time of the conversion. The initial conversion price will be $1.2592, subject to adjustment in the event of stock splits, stock dividends, and similar transactions. In addition, the Series A-1 Preferred Stock will automatically convert into shares of Common Stock, subject to certain beneficial ownership limitations as set forth in the Certificate of Designation and described below, on October 18, 2025.

Rank. The Series A-1 Preferred Stock will be pari passu with the Company's Series A Preferred Stock and any other class of the Company's capital stock that is by its terms pari passu with the Series A-1 Preferred Stock. The Series A-1 Preferred Stock will be senior to the Common Stock and any other class of the Company's capital stock that is not by its terms senior to or pari passu with the Series A-1 Preferred Stock.

Dividends. The holders of Series A-1 Preferred Stock will be entitled to dividends payable as follows: (i) a number of shares of Common Stock equal to 20% of the number of shares of Common Stock issuable upon conversion of the Series A-1 Preferred Stock then held by such Holder on October 18, 2024, and (ii) a number of shares of Common Stock equal to 20% of the number of shares of Common Stock issuable upon conversion of the Series A-1 Preferred Stock then held by such Holder on October 18, 2025. A holder that converts its Series A-1 Preferred Stock prior to October 18, 2024 or October 18, 2025, as the case may be, will not receive the dividend that accrues on such date with respect to such converted Series A-1 Preferred Stock. The holders of the Series A-1 Preferred Stock also will be entitled to dividends equal, on an as-if-converted to shares of Common Stock basis, to and in the same form as dividends actually paid on shares of the Common Stock when, as, and if such dividends are paid on shares of the Common Stock.

Liquidation. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company (or any Deemed Liquidation Event as defined in the Certificate of Designation), the holders of shares of Series A-1 Preferred Stock then outstanding will be entitled to be paid out of the assets of the Company available for distribution to its stockholders, before any payment shall be made to the holders of Common Stock by reason of their ownership thereof, and pari passu with the holders of the Series A Preferred Stock, an amount per share equal to the greater of (i) the Stated Value, plus any dividends accrued but unpaid thereon, or (ii) such amount per share as would have been payable had all shares of Series A-1 Preferred Stock been converted into Common Stock immediately prior to such event.

Voting. Except as otherwise provided in the Certificate of Designation or as otherwise required by law, the holders of outstanding shares of Series A-1 Preferred Stock will have no voting rights.

Beneficial Ownership Limitation. The Company will not effect any conversion of the Series A-1 Preferred Stock, and a holder will not have the right to receive dividends or convert any portion of the Series A-1 Preferred Stock, to the extent that, after giving effect to the receipt of dividends or the conversion, the holder (together with such holder's affiliates, and any persons acting as a group together with such holder or any of the holder's affiliates) would beneficially own in excess of 4.99% of the Company's outstanding common stock (or, upon election of the holder, 9.99% of the Company's outstanding common stock).