MITESCO, INC. Item 1.01 Entry into a Material Definitive Agreement.
Purchase Agreement
On
The closing on the first tranche of the offering resulted in gross proceeds to
the Company of
The foregoing description of the Purchase Agreement set forth above does not purport to be complete and is qualified in its entirety by reference to the Purchase Agreement. A form of the Purchase Agreement and Warrant is filed as Exhibit 10.1 hereto and incorporated herein by reference.
Registration Rights Agreement
In connection with the Purchase Agreement, the Company and the Purchasers entered into a registration rights agreement (the "Registration Rights Agreement"), pursuant to which the Company has agreed to register the shares of common stock underlying the Securities whenever the Company is required or proposes to register any of its equity securities under the Securities Act of 1933 (a "Piggyback Registration."). If a Purchaser is to participate in a Piggyback Registration in connection with a public offering, pursuant to the Registration Rights Agreement, the Purchaser agrees to be bound by certain lock-up agreements, as described in the Registration Rights Agreement.
The foregoing description of the Registration Rights Agreement set forth above does not purport to be complete and is qualified in its entirety by reference to the Registration Rights Agreement. A form of the Registration Rights Agreement is filed as Exhibit 10.2 hereto and incorporated herein by reference.
Exchange Agreements
Also in connection with the Purchase Agreement, the Company entered into
separate exchange agreements (the "Exchange Agreements") with each of the
Purchasers as well as prior investors into the Company (the "Holders"), pursuant
to which the Holders exchanged (the "Exchange") the
This summary is not a complete description of all of the terms of the Exchange Agreements and is qualified in its entirety by reference to the full text of the Exchange Agreements, a form of which is filed as Exhibit 4.1 hereto, which is incorporated by reference into this Item 1.01.
Item 3.02 Unregistered Sales of
The information set forth above under Item 1.01 is hereby incorporated by reference into this Item 3.02.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Effective
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Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On
The Series F Preferred Stock has no stated maturity and will not be subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless and until (x) converted or (y) the Corporation repurchases Series F Shares from the holder(s) thereof.
The Series F Preferred Stock will rank, with respect to rights to the
distribution of assets in the event of any liquidation, dissolution or winding
up of the Corporation: (i) senior to the Corporation's Common Stock, par value
Holders of shares of the Series F Preferred Stock are entitled to receive, on each Dividend Payment Date, whether or not declared, set aside for payment or otherwise authorized by the Board of Directors, payment-in-kind dividends payable to the holder(s) of Series F Preferred Stock only in additional shares of Series F Preferred Stock ("PIK Dividends") at the quarterly rate of three-hundredths (3/100th) of one share per outstanding Series F Share (equivalent to one-quarter (1/4) of 12% per annum per Series F Share) (the "Quarterly Dividend Rate").
In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of shares of Series F Preferred Stock will be entitled to be paid out of the assets the Company has legally available for distribution to its shareholders, subject to the preferential rights of the holders of any class or series of Preferred Stock of the Company ranking senior to the Series F Preferred Stock with respect to the distribution of assets upon liquidation, dissolution or winding up, an amount equal to the Liquidation Preference of the Series F Preferred Stock before any distribution of assets is made to holders of Common Stock or any other class or series of Preferred Stock of the Company that ranks junior to the Series F Preferred Stock as to liquidation rights.
As long as any shares of Series F are outstanding, the Company shall not, without the written consent or affirmative vote of the holders of a majority of the then outstanding shares of the Series F: (a) authorize or create, or increase the authorized or issued amount of, any class or series of capital stock ranking senior to the Series F Preferred Stock; (b) amend, alter, repeal or replace the Certificate of Incorporation so as to materially and adversely affect and deprive holders of Series F Preferred Stock of any right, preference, privilege or voting power of the Series F Preferred Stock; (c) amend, alter, repeal or replace the Certificate of Designations, or otherwise alter the rights, powers or privileges of the Series F Preferred Stock set forth in Certificate of Designations or Bylaws of the Corporation as then in effect, in a way that materially and adversely affects the Series F Preferred Stock or the holder(s) thereof; (d) redeem or repurchase any shares of Common Stock or Preferred Stock (other than pursuant to employee or consultant agreements giving the Company the right to repurchase shares upon the termination of services pursuant to the terms of the applicable agreement); or (e) declare or pay any dividend or otherwise make a distribution to holders of Preferred Stock or Common Stock (excluding payments in kind of additional shares of such securities).
On any date following the date of the first issuance of Series F Shares, holders of outstanding shares of Series F Preferred Stock shall have the right, at each holder's option, to convert their Series F Shares, in whole or in part, into Conversion Shares by following the mechanics of conversion set forth in the Certificate of Designation.
The foregoing description of the Certificate of Designations does not purport to be complete and is qualified in its entirety by reference to the Certificate of Designations, a copy which is filed as Exhibit 3.1, to this Current Report on Form 8-K and is incorporated herein by reference.
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Item 8.01 Other Events.
As a result of lack of funding, effective
As a result of our closing on the first tranche of the bridge financing, our 2022 year-end audit is in process and we intend to complete this as fast as possible in order to remain a fully reporting Company.
Forward Looking Statements
This Current Report on Form 8-K and the press release furnished as Exhibit 99.1 hereto, contain forward looking statements, including, but not limited to, statements related to the expected foreclosure of several of our clinics. Words such as "expects," "anticipates," "aims," "projects," "intends," "plans," "believes," "estimates," "seeks," "assumes," "may," "should," "could," "would," "foresees," "forecasts," "predicts," "targets," "commitments," and variations of such words and similar expressions are intended to identify such forward looking statements. We caution you that the foregoing may not include all the forward looking statements made in this Form 8-K.
These forward looking statements are based upon the Company's current plans,
assumptions, beliefs, and expectations. Forward looking statements are subject
to the occurrence of many events outside of the Company's control. Actual
results and the timing of events may differ materially from those contemplated
by such forward looking statements due to numerous factors that involve
substantial known and unknown risks and uncertainties. These risks and
uncertainties include, among other things, the risk that the liens could result
in defaults under the Company's leases for the affected clinic locations; the
risk that the amounts due under the leases could be accelerated; the risk that
defaults under the Company's leases could trigger other damages and remedies;
the risk that commenced and threatened litigation may result in material
judgements against the Company; the risk that foreclosure of the Company's
clinics may adversely affect the Company's internal programs and the Company's
ability to recruit and retain skilled and motivated personnel, and may be
distracting to employees and management; the risk that foreclosure of the
Company's clinics may negatively impact the Company's business operations and
reputation with or ability to serve customers; and other risks and uncertainties
included in the Company's reports on Forms 10-K, 10-Q, and 8-K and in other
filings the Company makes with the
Forward looking statements should be considered in light of these risks and uncertainties. Investors and others are cautioned not to place undue reliance on forward looking statements. All forward looking statements contained herein speak only as of the date hereof. The Company assumes no obligation and does not intend to update these forward-looking statements, except as required by law.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
3.1 State of Delaware Certificate of Designations, Preferences and Rights
of Series F 12% PIK Convertible Perpetual Preferred Stock of Mitesco,
Inc. dated March 24, 2023 .
4.1 Form of Exchange Agreements
10.1 Form of Securities Purchase Agreement and Warrant
10.2 Form of Registration Rights Agreement
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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