Washington, D.C. 20549
Information Statement Pursuant to Section
14(c) of the Securities Exchange Act of 1934 (Amendment No. )
NOTICE IS HEREBY GIVEN
that the holders of more than a majority of the voting power of the stockholders of Creative Medical Technology Holdings, Inc.,
a Nevada corporation (the “Company” “we,” “us,” or “our”),
have approved the following action without a meeting of stockholders in accordance with Section 78.320 of the Nevada Revised Statutes:
The approval of
an amendment to our Articles of Incorporation, as amended and corrected (the “Articles of Incorporation”), to
increase our authorized shares of common stock from 3,000,000,000 to 6,000,000,000.
The enclosed information
statement contains information pertaining to the matters acted upon.
INFORMATION STATEMENT
Action by Written Consent of Stockholders
GENERAL INFORMATION
WE ARE NOT ASKING YOU FOR A PROXY,
AND YOU ARE REQUESTED NOT TO SEND US
A PROXY
This information statement
is being furnished in connection with the action by written consent of stockholders taken without a meeting described in this information
statement. We are mailing this information statement to our stockholders of record on August 26, 2019.
What action was taken by written consent?
We obtained stockholder
consent for the approval of an amendment to our Articles of Incorporation to increase our authorized shares of common stock, par
value $.001 per share (the “Common Stock”), from 3,000,000,000 to 6,000,000,000.
How many shares of voting stock were
outstanding on August 26, 2019?
On August 26, 2019,
the date we received the consent of the holders of a majority of the voting power of our stockholders, there were 1,485,831,416
shares of Common Stock outstanding, and 3,000,000 shares of our Series A Preferred Stock outstanding. Each share of Series A Preferred
Stock has the right to cast 1,000 votes per share. The shares of Series A Preferred Stock vote together with the Common Stock as
a single class with respect to any and all matters presented to the holders of Common Stock for their action.
What vote was obtained to approve the
amendment to the Articles of Incorporation described in this Information Statement?
We obtained the approval
of the holders of 91,700,283 shares of Common Stock and 3,000,000 shares of Series A Preferred Stock (representing 3,000,000,000
votes), or approximately 69% of the voting power of our stockholders.
SPECIAL NOTE REGARDING FORWARD-LOOKING
STATEMENTS
Information included
in this Information Statement may contain forward-looking statements within the meaning of Section 27A of the Securities Act and
Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). This information may involve
known and unknown risks, uncertainties and other factors which may cause the Company's actual results, performance or achievements
to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements.
Forward-looking statements, which involve assumptions and describe the Company’s future plans, strategies and expectations,
are generally identifiable by use of the words “may,” “will,” “should,” “expect,”
“anticipate,” “estimate,” “believe,” “intend” or “project” or the negative
of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions
that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come
to pass. The Company’s actual results could differ materially from those expressed or implied by the forward-looking statements
as a result of various factors. The Company undertakes no obligation to update publicly any forward-looking statements for any
reason, even if new information becomes available or other events occur in the future.
AMENDMENT TO THE ARTICLES OF INCORPORATION
TO INCREASE AUTHORIZED SHARES OF COMMON
STOCK FROM 3,000,000,000 TO 6,000,000,000
Our Board of Directors
and the holders of a majority of the voting power of our stockholders have approved an amendment to our Articles of Incorporation
to increase our authorized shares of Common Stock from 3,000,000,000 to 6,000,000,000. The increase in our authorized shares of
Common Stock will become effective upon the filing of the amendment to our Articles of Incorporation with the Secretary of State
of the State of Nevada. We will file the amendment to our Articles of Incorporation to effect the increase in our authorized shares
of Common Stock (the “Amendment”) approximately (but not less than) 20 days after the definitive information
statement is mailed to stockholders.
The form of the Certificate
of Amendment to be filed with the Secretary of State of the State of Nevada is set forth as Appendix A to this Information
Statement.
Outstanding Shares and Purpose of
the Amendment
Our Articles of Incorporation
currently authorize us to issue a maximum of 3,000,000,000 shares of Common Stock, par value $0.001 per share. As of August 26,
2019, we had 1,485,831,416 shares of Common Stock issued and outstanding; however, we have entered into a series of financing transactions
which require us to maintain a reserve of shares for conversions of outstanding debt and exercise of warrants which are at multiples
of the number of shares from time to time issuable thereunder. In addition, in order to obtain future financings, we may be required
to have additional authorized and unissued shares reserved for issuance. A summary of our outstanding financing transactions which,
pursuant to their various terms, require the increase of authorized shares of Common Stock is as follows:
$100,000 Loan
On April 13, 2017,
the Company received a loan from an accredited investor in the face amount of $100,000, for which $90,000 in proceeds were received.
The loan is evidenced by a promissory note dated April 13, 2017, which bears interest at 12% and which matures on October 13, 2018.
In addition, at maturity the Company must pay 125% of principal and interest at maturity. The promissory note is secured by 400,000
shares of common stock held by the lender. On November 1, 2018 the note was amended to include a conversion feature. The convertible
note is convertible upon the amendment date and convertible into shares of the Company’s stock at a conversion price equal
to 80% of the lowest traded price of the Company’s common stock during the previous 20 trading days preceding the conversion
date. We are negotiating with the investor to extend the maturity date of the note. As of August 26, 2019, 37,196,347 shares of
common stock were issuable under this promissory note.
$110,000 Convertible
Note
On April 3, 2018,
the Company entered into a convertible note agreement with a third party for an aggregate principal amount of $110,000, for which
$95,000 in proceeds were received on April 3, 2018. Under the terms of the agreement, the convertible note incurs interest at 10%
per annum and has a maturity date of April 1, 2019. The convertible note is convertible upon issuance and convertible into shares
of the Company’s stock at a conversion price equal to 60% of the lowest traded price of the Company’s common stock
during the previous 20 trading days preceding the conversion date. The Company is required at all times to reserve shares of the
Company’s common stock equal to 5 times the number of common shares the convertible note is convertible into. At no additional
cost, we issued to the note holder 11,000,000 five-year warrants to purchase common stock at $0.01, subject to adjustment if we
issue securities at less than the exercise price. The warrants are exercisable on a cashless basis.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. As of August 26, 2019, there were 21,934,346 shares
reserved with our transfer agent with a potential of 743,201,421 being reserved if and when the lender issues a request to
our transfer agent.
$183,250
Convertible Note
On September 20,
2018, the Company entered into a convertible note agreement with a third party for an aggregate principal amount of $183,250, for
which $169,676 in proceeds were received. Under the terms of the agreement, the convertible note incurs interest at 8% per annum
and has a maturity date of September 20, 2019. The convertible note is convertible at any time after 31 days after the closing
date and convertible into shares of the Company’s stock at a conversion price equal to 65% of the lowest trading price of
the Company’s common stock during the previous 20 trading days preceding the conversion date. The Company is required at
all times to reserve shares of the Company’s common stock equal to three times the number of common shares the convertible
note is convertible into. At no additional cost, we issued to the note holder 1,247,618 five-year warrants to purchase common stock
at $0.088, subject to adjustment if we issue securities at less than the exercise price. The warrants are exercisable on a cashless
basis.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. On the date of issuance, the Company
anticipates that it will account for conversion feature as a derivative liability. Derivative accounting applies as the conversion
price is variable and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible
note is not repaid prior to the note being converted significant pressure may be put on the Company’s stock price and additional
dilution of current shareholders may take place. As of August 26, 2019, there were 10,020,242 shares reserved with our
transfer agent with a potential of 672,797,494 being reserved if and when the lender issues a request to our transfer agent.
$183,250 Convertible
Note
On September 20,
2018, the Company entered into a convertible note agreement with a third party for an aggregate principal amount of $183,250, for
which $169,676 in proceeds were received. Under the terms of the agreement, the convertible note incurs interest at 8% per annum
and has a maturity date of September 20, 2019. The convertible note is convertible at any time after 31 days after the closing
date and convertible into shares of the Company’s stock at a conversion price equal to 65% of the lowest trading price of
the Company’s common stock during the previous 20 trading days preceding the conversion date. The Company is required at
all times to reserve shares of the Company’s common stock equal to three times the number of common shares the convertible
note is convertible into. At no additional cost, we issued to the note holder 1,247,618 five-year warrants to purchase common stock
at $0.088, subject to adjustment if we issue securities at less than the exercise price. The warrants are exercisable on a cashless
basis.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 25,000,000 shares reserved with our transfer agent
with a potential of 1,018,425,032 being reserved if and when the lender issues a request to our transfer agent.
$108,000 Convertible
Note
On November 15,
2018, the Company entered into a convertible note agreement with a third party for an aggregate principal amount of $108,000, for
which $100,000 in proceeds were received. Under the terms of the agreement, the convertible note incurs interest at 8% per annum
and has a maturity date of November 15, 2019. The convertible note is convertible at any time after 31 days after the closing date
and convertible into shares of the Company’s stock at a conversion price equal to 70% of the lowest trading price of the
Company’s common stock during the previous 20 trading days preceding the conversion date. The Company is required at all
times to reserve shares of the Company’s common stock equal to three times the number of common shares the convertible note
is convertible into. At no additional cost, we issued to the note holder 1,985,294 five-year warrants to purchase common stock
at $0.0272, subject to adjustment if we issue securities at less than the exercise price. The warrants are exercisable on a cashless
basis.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 15,000,000 shares reserved with our transfer agent
with a potential of 550,243,444 being reserved if and when the lender issues a request to our transfer agent.
$108,000 Convertible
Note
On November 15,
2018, the Company entered into a convertible note agreement with a third party for an aggregate principal amount of $108,000, for
which $100,000 in proceeds were received. Under the terms of the agreement, the convertible note incurs interest at 8% per annum
and has a maturity date of November 15, 2019. The convertible note is convertible at any time after 31 days after the closing date
and convertible into shares of the Company’s stock at a conversion price equal to 70% of the lowest trading price of the
Company’s common stock during the previous 20 trading days preceding the conversion date. The Company is required at all
times to reserve shares of the Company’s common stock equal to three times the number of common shares the convertible note
is convertible into. At no additional cost, we issued to the note holder 1,985,294 five-year warrants to purchase common stock
at $0.0272, subject to adjustment if we issue securities at less than the exercise price. The warrants are exercisable on a cashless
basis.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 35,000,000 shares reserved with our transfer agent
with a potential of 191,180,089 being reserved if and when the lender issues a request to our transfer agent.
$140,800 Convertible
Note
On January 30,
2019, the Company entered into a convertible note agreement with a third party for an aggregate principal amount of $140,800,
for which $125,000 in proceeds were received. Under the terms of the agreement, the convertible note incurs interest
at 10% per annum and has a maturity date of January 1, 2020. The convertible note is convertible upon issuance and convertible
into shares of the Company’s stock at a conversion price equal to 71% of the 2 lowest trading prices of the Company’s
common stock during the previous 15 trading days preceding the conversion date. The Company is required at all times to reserve
shares of the Company’s common stock equal to six times the number of common shares the convertible note is convertible into.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 167,681,503 shares reserved with our transfer
agent with a potential of 132,499,889 being reserved if and when the lender issues a request to our transfer agent.
Warrant Exchange
On February 28,
2019, the Company entered into three separate Exchange Agreements (each, an “Exchange Agreement”) with the holders
(the “Warrant Holders”) of Common Stock Purchase Warrants issued by the Company in September 2018 and November 2018.
Under each Exchange Agreement, the Company issued a convertible promissory note in the principal amount of $100,000 (an “Exchange
Note”) to the Warrant Holder party to such Exchange Agreement in exchange for the cancellation of Common Stock Purchase Warrants
held by such Warrant Holder, initially exercisable for an aggregate of 3,232,912 shares of the Company’s common stock. The
exchanges were effected pursuant to Sections 3(a)(9) and 4(a)(2) of the Securities Act of 1933, as amended and Rule 506(b) promulgated
thereunder. The Company is required at all times to reserve shares of the Company’s common stock equal to 3 times the number
of common shares the convertible note is convertible into.
Each Exchange
Note matures on February 28, 2020, bears interest at a rate of 8% per annum, and beginning 31 days after the closing date, is convertible
into shares of the Company’s common stock at a conversion price equal to 65% of the Market Price of the common stock. “Market
Price” as defined in each Exchange Note means the average of the two lowest “VWAPs” (as defined) of the Company’s
common stock during the 15 trading days preceding the applicable conversion date.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 70,000,000 shares reserved with our transfer agent
with a potential of 1,073,747,805 being reserved if and when the lender issues a request to our transfer agent.
Note and Warrant
Purchase
On March 1, 2019,
the Company completed the sale of Convertible Notes and Common Stock Purchase Warrants to four institutional investors pursuant
to a Securities Purchase Agreement between the Company and the Investors dated as of February 19, 2019. Pursuant to the Purchase
Agreement, for a purchase price of $100,000, each investor purchased a Note in the principal amount of $110,000 and a warrant to
purchase 1,334,951 shares of common stock. Each note matures on March 1, 2020, bears interest at a rate of 8% per annum, and beginning
31 days after the closing date, is convertible into shares of the Company’s common stock at a conversion price equal to 65%
of the Market Price of the common stock.
The Company is
required at all times to reserve shares of the Company’s common stock equal to three times the number of common shares the
convertible note is convertible into.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 45,000,000 shares reserved with our transfer agent
with a potential of 2,361,750,615 being reserved if and when the lender issues a request to our transfer agent.
Each Warrant is
exercisable for a five-year period at an initial exercise price of $0.0206 per share, subject to anti-dilution adjustment in the
event of stock dividends, stock splits and other specified events.
$140,800
Convertible Note
On March 8, 2019,
the Company entered into a convertible note agreement with a third party for an aggregate principal amount of $91,300, for
which $80,300 in proceeds were received. Under the terms of the agreement, the convertible note incurs interest at 12% per
annum and has a maturity date of March 8, 2020. The convertible note is convertible upon issuance and convertible into shares of
the Company’s stock at a conversion price equal to 71% of the 2 lowest trading prices of the Company’s common
stock during the previous 15 trading days preceding the conversion date. The Company is required at all times to reserve shares
of the Company’s common stock equal to six times the number of common shares the convertible note is convertible into.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 102,873,239 shares reserved with our transfer
agent with a potential of 895,983,639 being reserved if and when the lender issues a request to our transfer agent.
$133,000
Convertible Note
On June 20, 2019,
the Company entered into a convertible note agreement with a third party for an aggregate principal amount of $133,000, for
which $114,000 in proceeds were received. Under the terms of the agreement, the convertible note incurs interest at 11% per
annum and has a maturity date of June 20, 2020. The convertible note is convertible upon issuance and convertible into shares of
the Company’s stock at a conversion price equal to 66% of the lowest traded price of the Company’s common
stock during the previous 20 trading days preceding the conversion date. The Company is required at all times to reserve shares
of the Company’s common stock equal to 4 times the number of common shares the convertible note is convertible into.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 20,151,000 shares reserved with our transfer agent
with a potential of 923,154,098 being reserved if and when the lender issues a request to our transfer agent.
Note and Warrant
Purchase
On July 29, 2019,
the Company completed the sale of 8% Original Issue Discount Senior Convertible Notes and Common Stock Purchase Warrants to three
institutional investors pursuant to a Securities Purchase Agreement between the Company and the Investors (the “Purchase
Agreement”) dated as of July 29, 2019. Pursuant to the Purchase Agreement, for a purchase price of $75,000.00, each investor
purchased a note in the principal amount of $81,000.00 and a warrant to purchase 4,807,695 shares of common stock. Each note matures
on July 29, 2020, bears interest at a rate of 8% per annum, and is convertible into shares of the Company’s common stock
at a conversion price equal to 60% of the lowest traded price of the Company’s common stock during the 15 trading days preceding
the applicable conversion date.
The Company is
required at all times to reserve shares of the Company’s common stock equal to three times the number of common shares the
convertible note is convertible into.
The conversion
price is subject to adjustment in the case of stock splits, stock dividends, combinations of shares and similar recapitalization
transactions and any issuances of securities below the conversion price of the convertible note. The conversion price is variable
and does not have a floor as to the number of common shares in which could be converted. Thus, if the convertible note is not repaid
prior to the note being converted significant pressure may be put on the Company’s stock price and additional dilution of
current shareholders may take place. As of August 26, 2019, there were 350,000,000 shares reserved with our transfer
agent with a potential of 1,368,641,096 being reserved if and when the lender issues a request to our transfer agent.
Each Warrant is
exercisable for a five-year period at an initial exercise price of $0.0039 per share, subject to anti-dilution adjustment in the
event of future sales of equity by the Company below the then exercise price, stock dividends, stock splits and other specified
events.
The table below addresses
aggregate convertible and share reserve requirements under our convertible debt agreements as of August 26, 2019 (the record date):
|
Shares of Common Stock Issuable Under Convertible Debt and Warrant Agreements
|
|
Share Reserve Requirements Under Convertible Debt and Warrant Agreements
|
|
2,984,668,728 shares of Common Stock
|
|
9,837,831,380 shares of Common Stock
|
Our debt is convertible,
and many of our warrants are exercisable, at rates that are dependent upon the trading price of our Common Stock from time to time.
As a result, the number of shares of Common Stock issuable under these arrangements is variable.
Based on the above,
the Board of Directors believes that the increase in our authorized Common Stock will allow us to comply with existing financing
agreements and will also provide us greater flexibility with respect to the Company’s capital structure for purposes of obtaining
additional financing.
Effects of the Increase in Authorized
Common Stock
In the event of conversions
of outstanding debt and exercise of warrants and the resulting increase in outstanding shares of Common Stock, the additional shares
of Common Stock will have the same rights as the presently authorized shares, including the right to cast one vote per share of
Common Stock. Although debt conversions, warrant exercises and the authorization of additional shares will not, in itself, have
any effect on the rights of any holder of our Common Stock, the future issuance of additional shares of Common Stock pursuant to
the conversions of outstanding debt and exercise of warrants, among others (other than by way of a stock split or dividend), would
have the effect of diluting existing stockholders.
At present, the Board
of Directors has no specific plans to issue the additional shares of Common Stock authorized by the Amendment (except upon conversions
of outstanding debt and exercise of warrants by our lenders). However, the Company anticipates that some of these additional shares
will be used in the future for various purposes without further stockholder approval, except as such approval may be required in
particular cases by our charter documents, applicable law or the rules of any stock exchange or other quotation system on which
our securities may then be listed. These purposes may include: raising capital, providing equity incentives to employees, officers
or directors, establishing strategic relationships with other companies, and expanding the Company’s business or product
lines through the acquisition of other businesses or products.
We could also use the
additional shares of Common Stock that will become available pursuant to the Amendment to oppose a hostile takeover attempt or
to delay or prevent changes in control or management of the Company. Although the Board’s approval of the Amendment was not
prompted by the threat of any hostile takeover attempt (nor is the Board currently aware of any such attempts directed at the Company),
stockholders should be aware that the Amendment could facilitate future efforts by us to deter or prevent changes in control of
the Company, including transactions in which stockholders of the Company might otherwise receive a premium for their shares over
then current market prices.
BENEFICIAL OWNERSHIP OF SECURITIES AND
SECURITY OWNERSHIP OF MANAGEMENT
The following table
and footnotes thereto sets forth information regarding the number of shares of common stock beneficially owned by (i) each director
and named executive officer of our company, (ii) each person known by us to be the beneficial owner of 5% or more of its issued
and outstanding shares of common stock, and (iii) all named executive officers and directors of the Company as a group. In calculating
any percentage in the following table of common stock beneficially owned by one or more persons named therein, the following table
assumes 1,485,831,416 shares of common stock issued and outstanding. Unless otherwise further indicated in the following table,
the persons and entities named in the following table have sole voting and sole investment power with respect to the shares set
forth opposite the shareholder’s name, subject to community property laws, where applicable. Unless as otherwise indicated
in the following table and/or the footnotes thereto, the address of each person beneficially owning in excess of 5% of the outstanding
common stock named in the following table is: 3008 West Lupine Avenue, Phoenix, Arizona 85029.
|
Name and Address of Beneficial Owner
|
|
Amount and
Nature of
Beneficial
Ownership(1)
|
|
|
Percent
of Class(1)
|
|
|
Named Executive Officers and Directors
|
|
|
|
|
|
|
|
|
|
Timothy Warbington
|
|
|
83,940,283
|
(2)
|
|
|
5.7%
|
|
|
Donald Dickerson
|
|
|
1,293,333
|
|
|
|
0.1%
|
|
|
Thomas Ichim PhD
|
|
|
2,586,667
|
(3)
|
|
|
0.2%
|
|
|
Amit Patel, MD
|
|
|
3,880,000
|
(4)
|
|
|
0.3%
|
|
|
Steven L. White
|
|
|
-
|
|
|
|
|
|
|
Executive Officers and Directors as a Group (5 Persons)
|
|
|
91,700,283
|
|
|
|
6.2%
|
|
|
5% Beneficial Holders
|
|
|
|
|
|
|
|
|
|
Creative Medical Health, Inc.(5)
3008 West Lupine Avenue
Phoenix, AZ 85029
|
|
|
77,473,616
|
(6)
|
|
|
5.2%
|
|
|
(1)
|
Under Rule 13d-3 of the Exchange Act, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in the above table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding on the date of this report.
|
|
(2)
|
Includes 77,473,616 shares beneficially owned by Creative Medical Health, Inc., of which Mr. Warbington serves as President and Chief Executive Officer. Mr. Warbington also holds 3,000,000 shares of Series A Preferred Stock, which entitle him to cast 1,000 votes per share. When the 3,000,000,000 votes are taken into account, Mr. Warbington accounts for 69% of the voting power of the Company’s outstanding shares of capital stock.
|
|
(3)
|
These shares are held by Biotech Holdings LLC, a limited liability company controlled by Mr. Ichim.
|
|
(4)
|
These shares are held by Jadi Cells, LLC, a limited liability company controlled by Mr. Patel.
|
|
(5)
|
Mr. Warbington, as President and CEO of Creative Medical Health, Inc. has voting and investment power over these shares which are included in shares beneficially owned by him above.
|
DESCRIPTION OF SECURITIES
General
Our current authorized
capital stock consists of 3,000,000,000 shares of common stock, and 10,000,000 shares of preferred stock, par value $0.001 per
share, of which we have designated 3,000,000 shares as Series A Preferred Stock. Our Board of Directors can, without shareholder
approval, cause additional shares of preferred stock to be issued and may determine the price, rights, preferences, privileges
and restrictions, including voting rights, of those additional shares. If our Board of Directors causes additional shares of preferred
stock to be issued, the rights of the holders of our common stock could be adversely affected. Our Board of Directors’ ability
to determine the terms of preferred stock and to cause its issuance, while providing desirable flexibility in connection with possible
acquisitions and other corporate purposes, could have the effect of making it more difficult for a third party to acquire a majority
of our outstanding voting stock. Additional preferred shares issued by our Board of Directors could include voting rights, or even
super voting rights, which could shift the ability to control the Company to the holders of the preferred stock. Additional preferred
shares could also have conversion rights into shares of common stock at a discount to the market price of the common stock which
could negatively affect the market for our common stock. In addition, additional preferred shares could have preference in the
event of liquidation of the Company, which means that the holders of additional preferred shares would be entitled to receive the
net assets of the Company distributed in liquidation before the common stock holders receive any distribution of the liquidated
assets. We have no current plans to issue any additional shares of preferred stock.
Common Stock
We are authorized to
issue up to 3,000,000,000 shares of $0.001 par value common stock. The holders of common stock are entitled to equal dividends
and distributions, per share, with respect to the common stock when, as and if declared by our Board of Directors from funds legally
available therefore. No holder of any shares of common stock has a pre-emptive right to subscribe for any securities of our company
nor are any common shares subject to redemption or convertible into other securities of our company. Upon liquidation, dissolution
or winding up of our company, and after payment of creditors and preferred shareholders, if any, the assets will be divided pro-rata
on a share-for-share basis among the holders of the shares of common stock.
Each share of common
stock is entitled to one vote with respect to the election of any director or any other matter upon which shareholders are required
or permitted to vote. Under Nevada corporate law, holders of our common stock do not have cumulative voting rights, so that the
holders of more than 50% of the combined shares voting for the election of directors may elect all of the directors, if they choose
to do so and, in that event, the holders of the remaining shares will not be able to elect any members to our Board of Directors.
Preferred Stock
We are authorized to
issue up to 10,000,000 shares of $0.001 par value preferred stock, of which 3,000,000 shares have been designated as Series A Preferred
Stock and were issued to our Chief Executive Officer in January 2018. The Series A Preferred Stock has the following rights and
preferences:
·
Upon liquidation, holders of shares of Series A Preferred Stock then outstanding will be entitled to receive, before any
payment is made or any assets distributed to the holders of the common stock, an amount per share of the Series A Preferred Stock
equal to $0.05 plus simple interest at the rate of 8% per annum from the issuance date of the outstanding shares of Series
A Preferred Stock;
·
Each Share of Series A Preferred Stock entitles the holder thereof to vote with the holders of common stock, voting together
as a single class, with respect to any and all matters presented to the holders of common stock and entitles each share of Series
A Preferred Stock to cast 1,000 votes per share;
·
On or after the fourth anniversary of the issuance date of shares of the Series A Preferred Stock, the Company, at its option,
may redeem all, but not less than all, of the outstanding shares of Series A Preferred Stock by paying to the holder a cash amount
equaling $0.05 plus simple interest at the rate of 8% per annum from the date of issuance of the shares, plus any accrued and unpaid
dividends thereon to the date fixed for redemption; and
·
The Series A Preferred Stock is not convertible into common shares or any other class of authorized stock of the Company.
Nevada Anti-Takeover Laws
The Nevada “Acquisition
of Controlling Interest” statutes generally provide that any person or entity that acquires 20% or more of the outstanding
voting shares of a publicly-held Nevada corporation in the secondary public or private market may be denied voting rights with
respect to the acquired shares, unless a majority of the disinterested shareholders of the corporation elects to restore such voting
rights in whole or in part. The control share acquisition act provides that a person or entity acquires “control shares”
whenever it acquires shares that, but for the operation of the control share acquisition act, would bring its voting power within
any of the following three ranges: (1) 20 to 33 1/3%, (2) 33 1/3 to 50%, or (3) more than 50%. A “control share acquisition”
is generally defined as the direct or indirect acquisition of either ownership or voting power associated with issued and outstanding
control shares. The shareholders or board of directors of a corporation may elect to exempt the stock of the corporation from the
provisions of the control share acquisition act through adoption of a provision to that effect in the Articles of Incorporation
or Bylaws of the corporation. Our Articles of Incorporation and Bylaws do not exempt our common stock from the control share acquisition
act. The control share acquisition act is applicable only to shares of “Issuing Corporations” as defined by the act.
An Issuing Corporation is a Nevada corporation, which; (1) has 200 or more shareholders, with at least 100 of such shareholders
being both shareholders of record and residents of Nevada; and (2) does business in Nevada directly or through an affiliated corporation.
At this time, we do
not have 100 shareholders of record resident of Nevada. Therefore, the provisions of the control share acquisition act do not apply
to acquisitions of our shares and will not until such time as these requirements have been met. At such time as they may apply
to us, the provisions of the control share acquisition act may discourage companies or persons interested in acquiring a significant
interest in or control of the company, regardless of whether such acquisition may be in the interest of our shareholders.
The Nevada “Combination
with Interested Stockholders Statute” may also have an effect of delaying or making it more difficult to effect a change
in control of the company. This statute prevents an “interested stockholder” and a resident domestic Nevada corporation
from entering into a “combination,” unless certain conditions are met. The statute defines “combination”
to include any merger or consolidation with an “interested stockholder,” or any sale, lease, exchange, mortgage, pledge,
transfer or other disposition, in one transaction or a series of transactions with an “interested stockholder” having;
(1) an aggregate market value equal to 5% or more of the aggregate market value of the assets of the corporation; (2) an aggregate
market value equal to 5% or more of the aggregate market value of all outstanding shares of the corporation; or (3) representing
10% or more of the earning power or net income of the corporation. An “interested stockholder” means the beneficial
owner of 10% or more of the voting shares of a resident domestic corporation, or an affiliate or associate thereof. A corporation
affected by the statute may not engage in a “combination” within three years after the interested stockholder acquires
its shares unless the combination or purchase is approved by the board of directors before the interested stockholder acquired
such shares. If approval is not obtained, then after the expiration of the three-year period, the business combination may be consummated
with the approval of the board of directors or a majority of the voting power held by disinterested stockholders, or if the consideration
to be paid by the interested stockholder is at least equal to the highest of: (1) the highest price per share paid by the interested
stockholder within the three years immediately preceding the date of the announcement of the combination or in the transaction
in which he became an interested stockholder, whichever is higher; (2) the market value per common share on the date of announcement
of the combination or the date the interested stockholder acquired the shares, whichever is higher; or (3) if higher for the holders
of preferred stock, the highest liquidation value of the preferred stock. The effect of Nevada’s business combination law
is to potentially discourage parties interested in taking control of the company from doing so if it cannot obtain the approval
of our board of directors.
Dividend Policy
We have never declared
or paid any cash dividends on our common stock and do not intend to pay dividends for the foreseeable future.
DISSENTER’S RIGHTS
Under the Nevada Revised
Statutes, holders of shares of Common Stock are not entitled to dissenters’ rights with respect to any aspect of the Amendment,
and we will not independently provide holders with any such right.
INTEREST OF CERTAIN PERSONS IN THE AMENDMENT
No director, executive
officer, associate of any director or executive officer or any other person has any substantial interest, direct or indirect, by
security holdings or otherwise, in the Amendment which is not shared by all other holders of the shares of Common Stock.
AVAILABLE INFORMATION
We are subject to the
information and reporting requirements of the Exchange Act and in accordance with such Act we file periodic reports, documents
and other information with the Securities and Exchange Commission relating to our business, financial statements and other matters.
Such reports and other information may be inspected and are available for copying at the public reference facilities of the Securities
and Exchange Commission at 100 F Street, N.E., Washington D.C. 20549 or may be accessed at www.sec.gov.
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By
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Order of the Board of Directors
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Timothy Warbington
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Chief Executive Officer
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September __, 2019
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Appendix A
CERTIFICATE OF AMENDMENT
TO ARTICLES OF INCORPORATION FOR NEVADA
PROFIT CORPORATIONS
(Pursuant to NRS 78.385 and 78.390 - After
Issuance of Stock)
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1.
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Name of Corporation: Creative Medical Technology Holdings, Inc.
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2.
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The Articles have been amended as follows:
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Article IV(a) is hereby amended to read
as follows:
(a) Common Stock. The aggregate number of shares of Common Stock which the Corporation shall have authority to issue is 6,000,000,000
at a par value of $0.001 per share. All stock, when issued shall be fully paid and non-assessable, shall be of the same class,
and shall have the same rights and preferences.
Each share of Common Stock shall
be entitled to one vote at a stockholders’ meeting, either in person or by proxy. Cumulative voting in elections of Directors
and all other matters brought before stockholder meetings, whether they be annual or special, shall not be permitted.
The holders of the capital stock
of the Corporation shall not be personally liable for the payment of the Corporation’s debts, and private property of the
holders of the capital stock of the Corporation shall not be subject to the payment of debts of the Corporation to any extent whatsoever.
Stockholders of the Corporation
shall not have any preemptive rights to subscribe for additional issues of stock of the Corporation except as may be agreed upon
from time to time by the Corporation and any stockholder.
3. The vote by which the stockholders holding shares in the corporation entitling them to exercise at least a majority of the voting
power, or such greater proportion of the voting power as may be required in the case of a vote by classes or series, or as may
be required by the provisions of the Articles of Incorporation have voted in favor of the amendment is: 69%.
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4.
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Effective date of filing: (optional)
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Timothy Warbington, Chief Executive Officer