Item 1.01 Entry into a Material Definitive Agreement.
On April 8, 2021, Todos Medical Ltd. (the "Company") entered into a Securities
Purchase Agreement (the "SPA") with an institutional investor (the "Purchaser")
pursuant to which the Company has agreed to issue a promissory convertible note
(the "Note") to the Purchaser in the principal amount of $4,285,714.29 for
proceeds of $3,000,000 (the "Transaction"). The closing occurred on April 12,
2021 (the "Closing Date"). The Note has a maturity date of one year from the
date of issuance and pays interest at a rate of 4% per annum. The Note is
convertible into shares of Common Stock (the "Conversion Shares") at a
conversion price of $0.0599 (the "Conversion Price). In addition, the Purchaser
received a warrant (the "Warrant") to purchase up to 16,000,000 shares of Common
Stock (the "Warrant Shares") of the Company with an exercise price equal to
$0.107415 per share. The Warrant is exercisable for 5 years from the date of
issuance. From the Closing Date until 180 days thereafter, the Company shall be
restricted from issuing or entering into any agreement to issue any shares of
Common Stock, except under certain circumstances. This provision shall no longer
be in effect if the closing sale price of the Common Stock exceeds $0.10. The
Company intends to use the net proceeds from this Note to initiate the Phase 2
for Tollovir™ clinical trial in COVID-19 patients, complete the acquisition of
Provista Diagnostics, Inc. and for general corporate purposes.
The Company has agreed to file a registration statement with the Securities and
Exchange Commission registering for resale the Conversion Shares and the Warrant
Shares (the "Registration Statement). Subsequent to the effective date of such
registration statement, if the closing sale price of the Common Stock averages
less than the then Conversion Price over a period of ten (10) consecutive
trading days, the Conversion Price shall reset to such average price. If the 10
day volume weighted average price of the Common Stock continues to be less than
the Conversion Price then the Conversion Price should reset to such 10-day
average price with a maximum of a 20% discount from the initial Conversion
Price.
The Purchaser has the option to purchase an additional Note in the principal
amount of $5,285,714.20 for proceeds of $3,700,000 and an additional Warrant to
purchase 16,000,000 shares of Common Stock.
The foregoing descriptions of the SPA, the Note and the Warrant do not purport
to be complete and are qualified in their entirety by reference to the full text
of the SPA, Note and Warrant, forms of which are attached as Exhibit 10.1, 10.2
and 10.3, respectively, to this Current Report on Form 8-K, and are incorporated
herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information included in Item 1.01 of this Form 8-K is hereby incorporated by
reference into this Item 2.03.
Item 3.02 Unregistered Sales of Equity Securities.
The information included in Item 1.01 of this Form 8-K is hereby incorporated by
reference into this Item 3.02.
The issuance of the securities described in item 1.01 was deemed to be exempt
from the registration requirements of the Securities Act of 1933, as amended
(the "Securities Act"), by virtue of Section 4(a)(2) and Rule 506 promulgated
thereunder.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
10.1 Securities Purchase Agreement dated April 8, 2021.
10.2 Form of Promissory Convertible Note.
10.3 Form of Warrant.
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