UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of March 2019
Commission File Number 333-209744
TODOS MEDICAL LTD.
(Translation of registrant's name into English)
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1 Hamada Street Rehovot, Israel 2244427 Tel: (011) (972) 8-633-3964 |
(Address of Principal Executive Offices)
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Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
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x Form 20-F o Form 40-F
| Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____ |
| Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____ |
Entry into a Material Definitive Agreement.
Amendment to Convertible Bridge Loan Transaction
Background
On February 27, 2019, we entered into a convertible bridge loan agreement (“Loan Agreement”), and issued notes and warrants relating thereto, to obtain an aggregate loan of $1,350,500 (the “Loan Amount”) from several private lenders, including DPH Investments Ltd., a holder of approximately 11.5% of the Registrant (“Lenders”). The Loan Amount is expected to be used for our working capital needs and to finance our activities through the consummation of a proposed public offering and our planned uplisting to the NASDAQ Capital Market.
The Loan Amount, which had an original issue discount of ten percent (10%), bears interest at a flat rate of ten percent (10%), and matures on August 27, 2019. The loan is convertible after the maturity date into ordinary shares of the Company at a conversion price equal to 70% of the average closing bid price of our ordinary shares in the five days prior to the conversion. In the event we default under the Loan Agreement, the conversion price will be reduced to 60% of the average closing bid price of our ordinary shares in the 15 days prior to the conversion.
As part of the Loan Agreement, we are issuing to each Lender a convertible promissory note (the “Note”) and an ordinary share purchase warrant for the purchase of ordinary shares (the “Warrant”).
The Warrant provides each Lender with 25% warrant coverage, with the warrant exercise price to be equal to the offering price in our proposed public offering, or, in the event the Loan Amount is converted into ordinary shares, the warrant exercise price will be equal to the applicable closing bid price of our shares at the time of the conversion of the Loan Amount. The term of the Warrant is three years from the date of the determination of the exercise price. The Warrant may be exercised by cash payment or through cashless exercise by the surrender of warrant shares having a value equal to the exercise price of the portion of the warrants being exercised.
The Loan Agreement and the Note contain events of default, including, among other things, failure to repay the Loan Amount by the maturity date, and bankruptcy and insolvency events, that could result in the acceleration of the Lenders’ right to convert the Loan Amount into ordinary shares.
Amendment
On March 10, 2019, we entered into an amendment to the convertible bridge loan agreement (“Amendment”). The Amendment provides for a 10% penalty if we repay the loan prior to the maturity date. In addition, we agreed to grant the Lenders an additional 25% warrant coverage, under the same terms as the original warrant, but with a warrant exercise price equal to 150% of the closing bid price of our shares on the day prior to the closing of the bridge loan transaction.
A copy of the Amendment is attached hereto as Exhibit 4.1 and is incorporated herein by reference. The foregoing descriptions of the terms and conditions of the Loan Agreement, the Note, and the Warrant are qualified in their entirety by reference to the full text of the Loan Agreement, the Note, and the Warrant.
We issued the new warrants under the exemptions from registration provided by Section 4(2) of the Securities Act of 1933. We expect that any issuance of our ordinary shares pursuant to the terms of the new warrants will be exempt from registration under Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”), and regulations promulgated thereunder. None of these transactions involved any underwriters, underwriting discounts or commissions, or any public offering, and the Lenders had adequate access, through their relationships with us, to information about us.
Our ordinary shares to be issued in the event of conversion of the Loan Amount and upon exercise of the new warrants will not be registered under the Securities Act, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act.
Financial Statements and Exhibits.
The following Exhibits are filed as part of this Report.
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Exhibit Number |
Description | |
| 4.1 | Amendment to Convertible Bridge Loan Agreement, dated February 27, 2019 | |
| 1 |
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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TODOS MEDICAL LTD. |
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| By: | /s/ Dr. Herman Weiss | |
| Name: Dr. Herman Weiss | ||
| Title: Chief Executive Officer | ||
| Date: March 12, 2019 | ||
| 2 |
Exhibit 4.1
AMENDMENT TO CONVERTIBLE BRIDGE LOAN AGREEMENT
THIS AMENDMENT CONVERTIBLE BRIDGE LOAN AGREEMENT (this “ Amendment ”) is entered into as of the 27 th day of February 2019 (“Effective Date”), by and between Todos Medical Ltd. , an Israeli company (the “ Company ”), and the entities set forth on Schedule 1 attached hereto (the “ Investors ”).
WHEREAS , the Company and the Investors entered into a Convertible Bridge Loan Agreement dated February 27, 2019 (the “Agreement”); and
WHEREAS , the Company and the Investors desire to amend the Agreement as set forth herein;
NOW, THEREFORE , the parties hereto hereby agree as follows:
1. Agreement .
Except as specifically modified by this Amendment, the terms and conditions of the Agreement shall remain in full force and effect. In the event of any inconsistency between the terms of this Amendment and the terms of the Agreement, the terms of this Amendment shall control. All capitalized terms used herein shall have the meaning ascribed to them in the Agreement, unless defined otherwise herein.
2. Prepayment
The following new Section 1.6 shall be added to the Agreement:
“1.6 Prepayment. In the event the Company prepays the Loan Principal and Interest prior to the Maturity Date, the Company shall pay an additional ten percent (10%) of the Loan Principal.”
3. Additional Warrant Coverage
The following new Section 4.3 shall be added to the Agreement:
“4.3 In addition to the Warrant issued to each Investor pursuant to Section 4.1 of the Agreement, at the Closing, the Company shall deliver to each Investor a second Warrant (the “ Second Warrant ”) providing each Investor with a right to purchase such number Warrant Shares equal in value to twenty-five percent (25%) of such Investor’s Loan Principal, at an exercise price that is equal to 150% of the closing bid price of the Company’s Ordinary Shares on the day prior to the Closing. The Investor may exercise the Second Warrant at any time starting six (6) months following the Uplisting or the conversion of the Loan Principal, as applicable, and up to three (3) years thereafter.”
4. Entire Agreement .
This Amendment and the Agreement constitute the entire agreement and understanding between the parties with regard to the subject matter hereof and supersede any prior written or oral agreements. Any modifications to this Amendment or the Agreement must be in writing and signed by the authorized representatives of the Parties.
5. Counterparts .
This Amendment may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF the parties have signed this Amendment to Convertible Bridge Loan Agreement in one or more counterparts as of the date first hereinabove set forth.