Item 3.01. Unregistered Sales of Equity Securities.
Issuance of Securities in Private Placement
On January 9, 2023, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) for a private placement of securities (the “Private Placement”) with Armistice Capital Master Fund Ltd. (“Armistice”). Pursuant to the Securities Purchase Agreement, on March 23, 2023, in consideration of approximately $8.0 million in cash, the Company issued to Armistice Class A units consisting of one common share, one Series F and one Series G warrant at a purchase price of $1.60029 per unit. In lieu of Class A units, for beneficial ownership purposes, as elected by Armistice, the Company also issued Class B units at the same price per unit consisting of convertible preferred stock convertible into approximately 625 shares of common stock shares per share of preferred, one Series F and one Series G warrant. Each Class B Unit contained an amount of Series A Preferred Stock that was convertible into one share of common stock. A total of 497,908 shares of common stock, 7,203 convertible preferred shares convertible into 4,501,060 common shares, 4,999,093 Series F and 4,999,093 Series G warrants were issued in the private placement. The Series F warrants are exercisable for two years, and the Series G warrants are exercisable for six years, and they each have a fixed exercise price of $3.00 per common share. The securities issued in the private placement contain no price reset or anti-dilution features. For further information, including the terms of the securities issued, see the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) on January 13, 2023, which is incorporated by reference herein.
The securities offered in the Private Placement and described above were offered in a private placement under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Act"), and/or Rule 506(b) of Regulation D promulgated thereunder, based on the representations made by Armistice in the Securities Purchase Agreement, and have not been registered under the Act or applicable state securities laws.
The Company has agreed to file a resale registration statement with respect to the common stock underlying the securities issued.
The foregoing description of the material terms of the Private Placement is qualified in its entirety by reference to the Securities Purchase Agreement incorporated by reference herein as Exhibit 10.4, the Registration Rights Agreement incorporated herein as Exhibit 10.5, the Certificate of Designation for the Series A Preferred Stock incorporated herein as Exhibit 3.2, the Form of Series F Warrant incorporated herein as Exhibit 4.2 and the Form of Series G Warrant incorporated herein as Exhibit 4.3.
Ladenburg Thalmann & Co. Inc. acted as the exclusive placement agent in the Private Placement. The Company paid approximately $640,000 in commissions with respect to the Private Placement.
Conversion of Shares of Series X Preferred Stock
Pursuant to the terms of the Amended and Restated Agreement and Plan of Merger entered into between the Company and Catheter Precision, Inc. on January 9, 2023, following approval of the Company’s stockholders on March 21, 2023, approximately 1,974.905 shares of the Company’s Series X Preferred Stock converted into approximately 1,974,905 shares of Company common stock at 5 pm Eastern time on March 23, 2023. No consideration was paid in connection with the conversion. The remaining approximately 12,674.687 shares of Series X Preferred Stock may convert into approximately 12,674,687 shares of common stock on or after July 9, 2024, provided that the Company meets the initial listing requirements of a national stock exchange or has been delisted from the NYSE American. For further information, including the terms of the Series X Preferred, see the Company’s Current Report on Form 8-K filed with the SEC on January 13, 2023, which is incorporated by reference herein.
The securities issued were exempt under Section 3(a)(9) of the Act, as no commission or other remuneration was paid for soliciting the conversion.
2