Guided Therapeutics, Inc.
Delaware | 3845 | 58-2029543 | ||
(State or other jurisdiction of incorporation or organization) | (Primary Standard Industrial Classification Code Number) | (I.R.S. Employer Identification Number) |
Large accelerated filer | o | Accelerated filer | o | Non-accelerated filer | o | Smaller reporting company | þ |
SUMMARY | 1 | |||
RISK FACTORS | 3 | |||
FORWARD LOOKING STATEMENTS | 9 | |||
USE OF PROCEEDS | 9 | |||
SELLING STOCKHOLDERS | 10 | |||
PLAN OF DISTRIBUTION | 11 | |||
DESCRIPTION OF SECURITIES | 11 | |||
OUR BUSINESS | 12 | |||
PROPERTIES | 19 | |||
LEGAL PROCEEDINGS | 19 | |||
MARKET FOR OUR COMMON STOCK AND RELATED STOCKHOLDER MATTERS | 20 | |||
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION | 21 | |||
DIRECTORS AND EXECUTIVE OFFICERS | 25 | |||
EXECUTIVE COMPENSATION | 27 | |||
SHARE OWNERSHIP OF DIRECTORS, OFFICERS AND CERTAIN BENEFICIAL OWNERS | 30 | |||
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE | 31 | |||
LEGAL MATTERS | 31 | |||
EXPERTS | 31 | |||
WHERE YOU CAN GET MORE INFORMATION | 31 | |||
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA | F-1 |
Between January 1st and March 6th, 2012, the Company had received a total of $138,323, from the exercise of outstanding warrants to purchase an aggregate of 212,804 shares of our common stock.
Common stock that may be offered by selling stockholders | 1,820000 shares of our common stock. See “Selling Stockholders” on page 9. |
Use of proceeds | We will not receive any proceeds from the resale of the shares of common stock. However, to the extent the warrants are exercised in whole or in part, we will receive payment for the exercise price. The terms of the warrants are described under “Description of Securities—Warrants and Options.” We expect to use any proceeds we receive from the exercise of the warrants for general corporate purposes, including working capital, capital expenditures and repaying or refinancing our debt obligations. See “Use of Proceeds” on page 9. |
Market for the common stock | Our common stock is dually listed on the OTCBB and the OTCQB quotation systems under the symbol “GHTP.” See “Market for Our Common Stock and Related Stockholder Matters” on page 18. |
Risk factors | You should read “Risk Factors” beginning on page 3 for an explanation of the risks of investing in our common stock. |
Accumulated deficit from inception to fiscal year ended 2009 | $73.9 million |
Net Loss for fiscal year 2010, ended 12/31/2010 | $ 4.5 million |
Accumulated deficit at fiscal year ended 12/31/2010 | $78.4 million |
Net Loss for fiscal year 2011, ended 12/31/2011 | $ 6.6 million |
Accumulated deficit, from inception to 12/31/2011 | $85.0 million |
We will require substantial additional capital to develop our products, including completing product testing and clinical trials, obtaining all required regulatory approvals and clearances, beginning and scaling up manufacturing, and marketing our products. We have historically financed our operations though the private sale of preferred stock and debt securities, public and private sales of common stock, funding from collaborative arrangements and grants. We believe funds on hand as of date of this prospectus, along with funds from government contracts and grants, and our collaborative arrangement with Konica Minolta , will be sufficient to support planned operations through the first quarter of 2013 , but will not be sufficient to fund our planned operations to the point of commercial introduction of our LuViva cervical cancer detection device . Any failure to achieve adequate funding in a timely fashion would delay our development programs and could lead to abandonment of one or more of our development initiatives. To the extent we cannot obtain additional funding, our ability to continue to develop and introduce products to market will be limited. Further, financing our operations through the public or private sale of debt or equity, may involve restrictive covenants or other provisions that could limit how we conduct our business or financing our operations. Financing our operations through collaborative arrangements generally means that the obligations of the collaborative partner to fund our expenditures are largely discretionary and depend on a number of factors, including our ability to meet specified milestones in the development and testing of the relevant product. We may not be able to meet these milestones, or the collaborative partner may not continue to fund our expenditures.
· | we, or any collaborative partner, will make timely filings with the FDA; |
· | the FDA will act favorably or quickly on these submissions; |
· | we will not be required to submit additional information or perform additional clinical studies; or |
· | other significant difficulties and costs will not be encountered to obtain FDA clearance or approval. |
▪ | we are a small company that is relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume; and | |
▪ | stock analysts, stock brokers and institutional investors may be risk-averse and be reluctant to follow a company such as ours that faces substantial doubt about its ability to continue as a going concern or to purchase or recommend the purchase of our shares until such time as we became more viable. |
· | control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; |
· | manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; |
· | “boiler room” practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; |
· | excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and |
· | the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse of those prices and with consequent investor losses. |
· | access to sufficient debt or equity capital to meet our operating and financial needs; |
· | the effectiveness and ultimate market acceptance of our products; |
· | whether our products in development will prove safe, feasible and effective; |
· | whether and when we or any potential strategic partners will obtain approval from the FDA and corresponding foreign agencies; |
· | our need to achieve manufacturing scale-up in a timely manner, and our need to provide for the efficient manufacturing of sufficient quantities of our products; |
· | the lack of immediate alternate sources of supply for some critical components of our products; |
· | our patent and intellectual property position; |
· | the need to fully develop the marketing, distribution, customer service and technical support and other functions critical to the success of our product lines; |
· | the dependence on potential strategic partners or outside investors for funding, development assistance, clinical trials, distribution and marketing of some of our products; and |
· | other risks and uncertainties described from time to time in our reports filed with the SEC. |
· | the names of the selling stockholders; |
· | the number of shares of common stock, and the percentages of outstanding common stock, beneficially owned by the selling stockholders as of March 15, 2012 prior to the selling stockholders’ offering of the shares of common stock pursuant to this prospectus; |
· | the maximum number of shares of common stock which may be offered by the selling stockholders pursuant to this prospectus; and |
· | the number of shares of common stock, and the percentages of outstanding common stock, to be beneficially owned by the selling stockholders after the offering of common stock pursuant to this prospectus, assuming all such common stock being offered is sold by the selling stockholders and that the selling stockholders do not acquire any additional shares of common stock. |
Beneficial Ownership of Common Stock Prior to Offering | Common Stock Being Offered Pursuant to this Prospectus (maximum number that may be sold)(1) | Beneficial Ownership of Common Stock After Offering | ||||||||||||||||||
Name of Selling Stockholder | Shares | Percentage | Shares | Percentage | ||||||||||||||||
Dolores Maloof | 5,086,466 | 8.84 | % | 1,820,000 | 3,266,466 | 5.86 | % | |||||||||||||
TOTAL | 5,086,466 | 8.84 | % | 1,820,000 | 3,266,466 | 5.86 | % |
The selling stockholders may sell the securities from time to time on any stock exchange or automated interdealer quotation system on which the securities are listed, in the over-the-counter market, in privately negotiated transactions or otherwise, at fixed prices that may be changed, at market prices prevailing at the time of sale, at prices related to prevailing market prices or at prices otherwise negotiated. The selling stockholders (also referred to as “selling security holders”) may sell the securities by one or more of the following methods:
1.block trades in which the broker or dealer so engaged will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction;
2.purchases by a broker or dealer as principal and resale by the broker or dealer for its own account;
3.ordinary brokerage transactions and transactions in which the broker solicits purchases;
4.privately negotiated transactions;
5.short sales;
6.through option transactions; and
7.any combination of any of these methods of sale.
We do not know of any arrangements by the selling security holders for the sale of any of the securities.
The selling security holders may engage brokers and dealers, and any brokers or dealers may arrange for other brokers or dealers to participate in effecting sales of the securities. These brokers, dealers or underwriters may act as principals, or as an agent of a selling security holder. Broker-dealers may agree with a selling security holder to sell a specified number of the securities at a stipulated price per security. If the broker-dealer is unable to sell securities acting as agent for a selling security holder, it may purchase as principal any unsold securities at the stipulated price. Broker-dealers who acquire securities as principals may thereafter resell the securities from time to time in transactions on any stock exchange or automated interdealer quotation system on which the securities are then listed, at prices and on terms then prevailing at the time of sale, at prices related to the then-current market price or in negotiated transactions. Broker-dealers may use block transactions and sales to and through broker-dealers, including transactions of the nature described above. The selling security holders may also sell the securities that qualify in accordance with Rule 144 under the Securities Act of 1933, as amended, rather than pursuant to this prospectus, regardless of whether the securities are covered by this prospectus.
To the extent required under the Securities Act of 1933, as amended, the aggregate amount of selling security holders’ securities being offered and the terms of the offering, the names of any agents, brokers, or dealers and any applicable commission with respect to a particular offer will be set forth in an accompanying prospectus supplement. Any dealers, brokers or agents participating in the distribution of the securities may receive compensation in the form of underwriting discounts, concessions, commissions or fees from a selling security holder and/or purchasers of selling security holders’ securities, for whom they may act (which compensation as to a particular broker-dealer might be in excess of customary commissions).
The selling security holders and any brokers, dealers or agents that participate in the distribution of the securities may be deemed to be “underwriters” within the meaning of the Securities Act of 1933, as amended, and any discounts, concessions, commissions or fees received by them and any profit on the resale of the securities sold by them may be deemed to be underwriting discounts and commissions.
A selling security holder may enter into hedging transactions with broker-dealers and the broker-dealers may engage in short sales of the securities in the course of hedging the positions they assume with that selling security holder, including, without limitation, in connection with distributions of the securities by those broker-dealers.
The selling security holders and other persons participating in the sale or distribution of the securities will be subject to applicable provisions of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, including Regulation M. This regulation may limit the timing of purchases and sales of any of the securities by the selling security holders and any other person. The anti-manipulation rules under the Securities Exchange Act of 1934, as amended, may apply to sales of securities in the market and to the activities of the selling security holders and their affiliates. Furthermore, Regulation M may restrict the ability of any person engaged in the distribution of the securities to engage in market-making activities with respect to the particular securities being distributed for a period of up to five business days before the distribution. These restrictions may affect the marketability of the securities and the ability of any person or entity to engage in market-making activities with respect to the securities.
We have agreed to indemnify in certain circumstances the selling security holders against certain liabilities, including liabilities under the Securities Act of 1933, as amended. The selling security holders have agreed to indemnify us in certain circumstances against certain liabilities, including liabilities under the Securities Act of 1933, as amended.
In order to comply with the securities laws of certain states, sales of shares offered hereby to the public in such states may be made only through broker-dealers who are registered or licensed in such states. Sales of shares offered hereby must also be made by the selling stockholders in compliance with other applicable state securities laws and regulations.
2011 | 2010 | |||||||||||||||
HIGH | LOW | HIGH | LOW | |||||||||||||
First Quarter | $ | 1.46 | $ | 0.77 | $ | 1.43 | $ | 0.72 | ||||||||
Second Quarter | $ | 1.07 | $ | 0.85 | $ | 1.00 | $ | 0.68 | ||||||||
Third Quarter | $ | 1.00 | $ | 0.74 | $ | 0.90 | $ | 0.77 | ||||||||
Fourth Quarter | $ | 1.52 | $ | 0. 69 | $ | 0.89 | $ | 0.73 |
Plan category | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | |||||||||
(a) | (b) | (c) | ||||||||||
Equity compensation plans approved by security holders | 6,862,167 | $ | 0. 70 | 1,393,052 | ||||||||
Equity compensation plans not approved by security holders | - | - | - | |||||||||
TOTAL | 6,862,167 | $ | 0. 70 | 1,393,052 |
Name | Age | Position with Guided Therapeutics | ||
Mark L. Faupel, Ph.D. | 56 | Chief Executive Officer, Acting Chief Financial Officer, President and Director | ||
Richard L. Fowler | 55 | Senior Vice President of Engineering | ||
Shabbir Bambot, Ph.D. | 46 | Vice President for Research and Development | ||
Ronald W. Allen | 70 | Chairman and Director | ||
Ronald W. Hart, Ph.D. | 69 | Vice Chairman and Director | ||
John E. Imhoff, M.D. | 62 | Director | ||
Michael C. James | 53 | Director | ||
Jonathan M. Niloff, M.D. | 57 | Director |
(1) As a former FDA bureau chief, he advises the Board and management on our FDA relationship and strategy. |
(2) As an active participant in the venture community, he advises the Board on financing and other opportunities. |
(3) As an expert in organizational matters, he advises the Board and management regarding company strategy and potential strategic partnerships. |
(4) As an expert in international trade, he advises the Board and management on international partnering and distribution agreements. |
Name and Principal Position | Year | Salary ($) | Bonus ($) | Option Awards ($)(1) | Total ($) | ||||||||||||
Mark Faupel, Ph.D. | 2011 | 243 ,000 | - | 214,500 | 457,500 | ||||||||||||
President, CEO, Acting CFO and Director | 2010 | 228,000 | - | 520 ,000 | 748 ,000 | ||||||||||||
Richard Fowler, | 2011 | 173,400 | - | 6,250 | 179,650 | ||||||||||||
Senior Vice President of Engineering | 2010 | 170,000 | - | - | 170,000 | ||||||||||||
Shabbir Bambot, Ph.D. | 2011 | 183,750 | - | 6,000 | 189,750 | ||||||||||||
Vice President of Research and Development | 2010 | 175,000 | - | - | 175,000 |
Option Awards | |||||||||||||||||||
Name and Principal Position | Number of Securities Underlying Options Exercisable (#)(1) | Number of Securities Underlying Options Un-exercisable (#) | Equity Incentive Plan Awards: Number of Securities Under- lying Un-exercised Unearned Options (#) | Option Exercise Price ($)(2) | Option Expiration Date | ||||||||||||||
Mark Faupel, Ph.D. President, CEO & Acting CFO | 1,306,000 | - | 830,000 | 0. 75 | 12/16/2021 | ||||||||||||||
Richard Fowler Senior Vice President of Engineering | 336,000 | - | 125,000 | 0. 61 | 12/ 16/2021 | ||||||||||||||
Shabbir Bambot, Ph.D. Vice President of Research & Development | 637,500 | - | 120,000 | 0. 51 | 12/ 16/2021 |
(1) | Represents fully vested options. |
(2) | Based on all outstanding options |
Option Awards | ||||||||
Name and Principal Position | Option Awards (#) | Exercise Price ($) | ||||||
Ronald W. Allen Chairman and Director | 642,500 | 0. 41 | ||||||
Ronald W. Hart, Ph.D. Director | 498 ,750 | 0. 41 | ||||||
John E. Imhoff, M.D. Director | 247 ,500 | 0. 80 | ||||||
Michael C. James Director | 51 ,250 | 0. 88 | ||||||
Jonathan Niloff, M.D. Director | 86 ,667 | 0. 78 |
1. | Ronald W. Hart, Ph.D. – Dr. Hart’s consulting services include regulatory and clinical issues, especially with advice for the Company with regard to its application to the FDA. |
2. | Ronald W. Allen – Mr. Allen advises the company with regard to personnel and financing. As such, he plays an important role in identifying potential funding sources. |
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership (1) | Percent of Class (2) | ||||||
John E. Imhoff (3) | 11,028,180 | 19.19 | % | |||||
The Whittemore Collection, Ltd. / George Landegger (4) 4 International Drive Rye Brook, NY 10573 | 6, 414,697 | 12.16 | % | |||||
Dolores Maloof (5) 2669 Mercedes Drive Atlanta, GA 30345 | 5,086,466 | 8. 84 | % | |||||
Richard Blumberg (6) 821 Second Avenue, Suite 2200 Seattle, WA 98116 | 2,798,469 | 5. 07 | % | |||||
Michael C. James / Kuekenhof Equity Fund, LLP (7) | 2, 451,192 | 4.52 | % | |||||
Ronald Hart (8) | 1, 620,435 | 3.05 | % | |||||
Mark L. Faupel (9) | 1, 406, 000 | 2. 62 | % | |||||
Ronald W. Allen (10) | 1,009, 376 | 1. 89 | % | |||||
Shabbir Bambot (11) | 637,500 | 1. 20 | % | |||||
Richard L. Fowler (12) | 479,343 | * | % | |||||
Jonathan Niloff (13) | 125,834 | * | ||||||
All directors and executive officers as a group (8 persons) (14) | 18, 757,860 | 29.64 | % |
(*) | Less than 1%. |
(1) | Except as otherwise indicated in the footnotes to this table and pursuant to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all shares of common stock. |
(2) | Percentage ownership is based on 52,211,073 shares of common stock outstanding as of March 15, 2012. Beneficial ownership is determined in accordance with the rules of the SEC, based on factors that include voting and investment power with respect to shares. Shares of common stock subject to currently exercisable options, warrants, convertible preferred stock or convertible notes, or any such securities exercisable within 60 days after March 16, 2012 , are deemed outstanding for purposes of computing the percentage ownership of the person holding those options, but are not deemed outstanding for purposes of computing the percentage ownership of any other person. |
(3) | Consists of 5, 996,757 common shares, 4,783,923 warrants to purchase common stock at $0.65 per share and 247 ,500 shares subject to stock options. Dr. Imhoff is on the board of directors. |
(4) | Consists of 6,129,511 shares of common stock and 285,186 warrants to purchase common stoc k at $ 1.05 per share. |
(5) | Consists of warrants to purchase 1,820,000 and 3,266,466 common shares at $ 0.01 and 0 .65 per share, respectively . |
(6) | Consists of 2,798,469 warrants to purchase common stock at $0.65 per share. |
(7) | Consists of 663 ,368 shares of common stock and 1,736,574 warrants to purchase common stock at $0.65 per share, held by Kuekenhof Equity Fund, LP, plus 51 ,250 shares subject to stock options held by Michael C. James personally. Mr. James is on the Board of Directors. |
(8) | Consists of 903 ,275 shares of common stock, 218,410 warrants to purchase common stock at $0.65 per share and 498,750 shares subject to stock options held by Hart Management, LLC, Ronald Hart, owner. Dr. Hart is on the Board of Directors. |
(9) | Consists of 100,000 shares of common stock and 1, 306 ,000 shares subject to stock options. |
(10) | Consists of 124, 341 shares of common stock, 242,535 warrants to purchase common shares at $0.65 per share and 642 ,500 shares subject to stock options held by Ronald Allen. Mr. Allen is on the Board of Directors. |
(11) | Consists of 637,500 shares subject to stock options. |
(12) | Consists of 87,223 shares of common stock, 56,120 warrants to purchase common shares at $0.65 per share and 336,000 shares subject to stock options. |
(13) | Consists of 39,167 shares of common stock, and 86 ,667 shares subject to stock options held by Jonathan M. Niloff. Dr. Niloff is on the Board of Directors. |
(14) | Consists of 7,914,131 shares of common stock, 7,037,562 warrants to purchase common shares at $0.65 per share and 3, 806,167 shares subject to stock options. |
Annual Consolidated Financial Statements | ||||
Report of Independent Registered Public Accounting Firm | F-2 | |||
Consolidated Balance Sheets as of December 31, 201 1 and 20 1 0 | F-3 | |||
Consolidated Statements of Operations for the Year Ended December 31, 201 1 and 20 1 0 | F-4 | |||
Consolidated Statements of Cash Flows for the Year Ended December 31, 201 1 and 20 1 0 | F-6 | |||
Notes to Consolidated Financial Statements | F-7 |
2011 | 2010 | |||||||
ASSETS | ||||||||
CURRENT ASSETS: | ||||||||
Cash and cash equivalents | $ | 2,200 | $ | 3,268 | ||||
Accounts receivable, net of allowance for doubtful accounts of $20 and $38 at December 31, 2011 and 2010, respectively | 117 | 85 | ||||||
Inventory, net of reserves of $64 and $0 at December 31, 2011 and 2010, respectively | 520 | - | ||||||
Other current assets | 54 | 30 | ||||||
Total current assets | 2,891 | 3,383 | ||||||
Property and equipment, net | 1,033 | 37 | ||||||
Capitalized cost of internally developed software for internal use | - | 299 | ||||||
Other assets | 386 | 200 | ||||||
Total noncurrent assets | 1,419 | 536 | ||||||
TOTAL ASSETS | $ | 4,310 | $ | 3,919 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
CURRENT LIABILITIES: | ||||||||
Short-term notes payable | $ | 30 | $ | 25 | ||||
Current portion of long term debt | 25 | - | ||||||
Notes payable – past due | 362 | 614 | ||||||
Accounts payable | 1,102 | 915 | ||||||
Accrued liabilities | 757 | 885 | ||||||
Deferred revenue | 453 | 332 | ||||||
Total current liabilities | 2,729 | 2,771 | ||||||
Long-term loan payable, less current portion | 4 | 31 | ||||||
TOTAL LIABILITIES | 2,733 | 2,802 | ||||||
COMMITMENTS & CONTINGENCIES (Note 5) | ||||||||
STOCKHOLDERS’ EQUITY (DEFICIT): | ||||||||
Common stock, $.001 par value; 100,000 shares authorized, 52,211 and 47,299 shares issued and outstanding as of December 31, 2011 and 2010, respectively | 52 | 47 | ||||||
Additional paid-in capital | 86,614 | 79,515 | ||||||
Treasury stock, at cost | (104 | ) | (104 | ) | ||||
Accumulated deficit | (85,089 | ) | (78,445 | ) | ||||
TOTAL GUIDED THERAPEUTICS STOCKHOLDERS’ EQUITY | 1,473 | 1,013 | ||||||
Non-controlling interest | 104 | 104 | ||||||
TOTAL STOCKHOLDERS’ EQUITY | 1,577 | 1,117 | ||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 4,310 | $ | 3,919 |
2011 | 2010 | |||||||
REVENUE: | ||||||||
Contract and grant revenue | $ | 3,597 | $ | 3,364 | ||||
Sales – Devices and Disposables | 25 | - | ||||||
Cost of goods sold | 106 | - | ||||||
Gross loss | (81 | ) | - | |||||
OPERATING EXPENSES: | ||||||||
Claim settlement | 3,622 | - | ||||||
Research and development | 2,779 | 1,805 | ||||||
Sales and marketing | 287 | 131 | ||||||
General and administrative | 3,584 | 3,049 | ||||||
Total Costs and Expenses | 10,272 | 4,985 | ||||||
Operating loss | (6,756 | ) | (1,621 | ) | ||||
OTHER INCOME | 192 | 2 | ||||||
INTEREST EXPENSE | (80 | ) | (1,227 | ) | ||||
LOSS FROM OPERATIONS | (6,644 | ) | (2,846 | ) | ||||
PROVISION FOR INCOME TAXES | - | - | ||||||
NET LOSS | (6,644 | ) | (2,846 | ) | ||||
PREFERRED STOCK DIVIDENDS | - | (1,700 | ) | |||||
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | (6,644 | ) | $ | (4,546 | ) | ||
BASIC AND DILUTED NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | (0.14 | ) | $ | (0.12 | ) | ||
WEIGHTED AVERAGE SHARES OUTSTANDING | 48,868 | 38,596 |
Preferred Stock Series A | Common Stock | Additional Paid-In | Treasury | Accumulated | Non- Controlling | |||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Stock | Deficit | Interest | TOTAL | ||||||||||||||||||||
BALANCE, January 1, 2010 | 243 | $ | 1,962 | 19,915 | $ | 20 | $ | 61,642 | $ | (104 | ) | $ | (75,599 | ) | $ | 104 | $ | (11,975 | ) | |||||||||
Conversion of convertible notes into common stock | - | - | 14,528 | 14 | 9,319 | - | - | - | 9,333 | |||||||||||||||||||
Conversion of preferred stock and accrued dividends into common stock | (243 | ) | (1,962 | ) | 8,084 | 8 | 3,778 | - | - | - | 1,824 | |||||||||||||||||
Issuance of common stock | - | - | 3,772 | 4 | 3,051 | - | - | - | 3,055 | |||||||||||||||||||
Exercise of warrants/options | - | - | 899 | 1 | 477 | - | - | - | 478 | |||||||||||||||||||
Conversion of accrued compensation into common stock | - | - | 101 | - | 90 | - | - | - | 90 | |||||||||||||||||||
Stock-based compensation expense | - | - | - | - | 1,158 | - | - | - | 1,158 | |||||||||||||||||||
Net Loss | - | - | - | - | - | - | (2,846 | ) | - | (2,846 | ) | |||||||||||||||||
BALANCE, December 31, 2010 | - | $ | - | 47,299 | $ | 47 | $ | 79,515 | $ | (104 | ) | $ | (78,445 | ) | $ | 104 | $ | 1,117 | ||||||||||
Issuance of warrants for claim settlement | - | - | - | - | 3,622 | - | - | - | 3,622 | |||||||||||||||||||
Issuance of common stock | - | - | 2,090 | 2 | 1,765 | - | - | - | 1,767 | |||||||||||||||||||
Exercise of warrants/options | - | - | 2,609 | 3 | 815 | - | - | - | 818 | |||||||||||||||||||
Conversion of debts into common stock | - | - | 34 | - | 27 | - | - | - | 27 | |||||||||||||||||||
Stock-based compensation expense | - | - | 179 | - | 870 | - | - | - | 870 | |||||||||||||||||||
Net Loss | - | - | - | - | - | - | (6,644 | ) | - | (6,644 | ) | |||||||||||||||||
BALANCE, December 31, 2011 | - | $ | - | 52,211 | $ | 52 | $ | 86,614 | $ | (104 | ) | $ | (85,089 | ) | $ | 104 | $ | 1,577 |
2011 | 2010 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net loss | $ | (6,644 | ) | $ | (2,846 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Bad debt expense | 18 | 3 | ||||||
Depreciation | 34 | 7 | ||||||
Amortization and accretion of deferred financing costs, notes and warrants | - | 1,095 | ||||||
Issuance of warrants for legal settlement | 3,622 | - | ||||||
Stock based compensation | 870 | 1,158 | ||||||
Conversion of interest to principal | - | 230 | ||||||
Changes in operating assets and liabilities: | ||||||||
Inventory | (520 | ) | - | |||||
Accounts receivable | (50 | ) | 47 | |||||
Other current assets | (24 | ) | 18 | |||||
Accounts payable | 187 | (243 | ) | |||||
Deferred revenue | 121 | 82 | ||||||
Accrued liabilities | (168 | ) | 141 | |||||
Other assets | (180 | ) | (39 | ) | ||||
Total adjustments | 3,910 | 2,499 | ||||||
Net cash used in operating activities | (2,734 | ) | (347 | ) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Additions to capitalized software costs | (260 | ) | (186 | ) | ||||
Additions to fixed assets | (444 | ) | (40 | ) | ||||
Net cash used in investing activities | (704 | ) | (226 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from issuance of common stock | 1,767 | 3,055 | ||||||
Proceeds from issuance of convertible notes payable to former debt holders - related parties | - | 101 | ||||||
Payments made on notes payable | (215 | ) | (23 | ) | ||||
Proceeds from options and warrants exercised | 818 | 478 | ||||||
Net cash provided by financing activities | 2,370 | 3,574 | ||||||
NET CHANGE IN CASH AND CASH EQUIVALENTS | (1,068 | ) | 3,611 | |||||
CASH AND CASH EQUIVALENTS, beginning of year | 3,268 | 230 | ||||||
CASH AND CASH EQUIVALENTS, end of period | $ | 2,200 | $ | 3,268 | ||||
SUPPLEMENTAL SCHEDULE OF: | ||||||||
Cash paid for: | ||||||||
Interest | $ | 183 | $ | 253 | ||||
NONCASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
Conversion of preferred stock into common stock | $ | - | $ | 1,962 | ||||
Dividends payable in the form of preferred stock converted into common stock | $ | - | $ | 1,824 | ||||
Conversion of bridge notes payable into common stock | $ | - | $ | 9,333 | ||||
Conversion of accrued expenses into common stock | $ | 27 | $ | - | ||||
Conversion of interest to principal | $ | 63 | $ | - | ||||
Conversion of accrued compensation to debt | $ | - | $ | 90 | ||||
Deemed dividends in the form of warrants. | $ | - | $ | 1,700 |
Year Ended December 31, | �� | ||||||||
2011 | 2010 | ||||||||
Equipment | $ | 1,484 | $ | 1,426 | |||||
Software | 640 | - | |||||||
Furniture and fixtures | 605 | 500 | |||||||
Leasehold Improvement | 170 | - | |||||||
2,899 | 1,926 | ||||||||
Less accumulated depreciation | (1,866 | ) | (1,889 | ) | |||||
Total | $ | 1,033 | $ | 37 |
As of December 31, | ||||||||
2011 | 2010 | |||||||
Accrued compensation | $ | 463 | $ | 632 | ||||
Accrued professional fees | 126 | 143 | ||||||
Accrued rent | 82 | 36 | ||||||
Other accrued expenses | 86 | 74 | ||||||
Total | $ | 757 | $ | 885 |
2011 | 2010 | |||||||||||
Expected volatility | 146 | % | 125 | % | ||||||||
Expected option life in years | 10.0 | 10.0 | ||||||||||
Expected dividend yield | 0.00 | % | 0.0 | % | ||||||||
Risk-free interest rate | 1.94 | % | 1.50 | % | ||||||||
Weighted average fair value per option at grant date | $ | 1.20 | $ | 0.98 |
2011 | 2010 | |||||||||||||||
Weighted Average Exercise | Weighted Average Exercise | |||||||||||||||
Shares | Price | Shares | Price | |||||||||||||
Outstanding at beginning of year | 5,738,167 | $ | 0.41 | 5,480,076 | $ | 0.38 | ||||||||||
Options granted | 2,143,000 | $ | 1.20 | 632,667 | $ | 1.02 | ||||||||||
Options exercised | ( 980,000 | ) | $ | 0.07 | (223,576 | ) | $ | 0.03 | ||||||||
Options expired/forfeited | ( 39,000 | ) | $ | 1.52 | (151,000 | ) | $ | 3.59 | ||||||||
Outstanding at end of year | 6,862,167 | $ | 0.70 | 5,738,167 | $ | 0.41 | ||||||||||
Options vested and exercisable at year-end | 4,800,354 | $ | 0.47 | 4,456,500 | $ | 0.39 | ||||||||||
Options available for grant at year-end | 1,393,052 | 2,517,052 | ||||||||||||||
Aggregate intrinsic value – options exercised | $ | 72,990 | $ | 172,073 | ||||||||||||
Aggregate intrinsic value – options outstanding | $ | 5,624,479 | $ | 2,229,563 | ||||||||||||
Aggregate intrinsic value – options vested and exercisable | $ | 5,055,690 | $ | 1,860,362 |
Warrants (Underlying Shares) | Exercise Price | Expiration Date | |||||||
28,605,141 | (1 | ) | $ | 0.65 | 03/01/2013 | ||||
6,790 | (2 | ) | $ | 1.01 | 09/10/2015 | ||||
2,320,000 | (3 | ) | $ | 0.01 | 03/01/2013 | ||||
285,186 | (4 | ) | $ | 1.05 | 11/20/2016 | ||||
31,217,117 |
(1) | During the year ended December 31, 2011, warrants for 562,424 shares of common stock were exercised. |
(2) | Consists of outstanding warrants issued in conjunction with a private placement on September 10, 2010. |
(3) | Consists of warrants to purchase common stock at a purchase price of $0.01 per share issued in conjunction with the settlement of a claim. |
(4) | Consists of outstanding warrants issued in conjunction with a private placement on November 21, 2011. |
2011 | 2010 | |||||||
Deferred tax assets: | ||||||||
Net operating loss carryforwards | $ | 25,095 | $ | 23,651 | ||||
Deferred tax liabilities: | ||||||||
Intangible assets and other | - | 980 | ||||||
25095 | 24631 | |||||||
Valuation allowance | (25,095 | ) | (24,631 | ) | ||||
$ | 0 | $ | 0 |
2011 | 2010 | |||||||
Statutory federal tax rate | 34 | % | 34 | % | ||||
State taxes, net of federal benefit | 4 | 4 | ||||||
Nondeductible expenses | - | - | ||||||
Valuation allowance | (38 | ) | (38 | ) | ||||
0 | % | 0 | % |
Year | Amount | |||
2012 | $ | 172 | ||
2013 | $ | 177 | ||
2014 | $ | 179 | ||
2015 | $ | 183 | ||
2016 and thereafter | $ | 255 | ||
Total | $ | 966 |
Year Ended December 31, | |||||||||
2011 | 2010 | ||||||||
Beginning balance | $ | 38 | $ | 41 | |||||
Additions / (Adjustments) | (18 | ) | (3 | ) | |||||
Balance | $ | 20 | $ | 38 |
Year Ended December 31, | |||||||||
2011 | 2010 | ||||||||
Beginning balance | $ | - | $ | - | |||||
Additions / (Adjustments) | 64 | - | |||||||
Balance | $ | 64 | $ | - |
Expense | Dollar Amount | |||
SEC filing fee | $ | 1,872 | ||
Legal fees and expenses | 10, 000 | |||
Accounting fees and expenses | 10 ,000 | |||
Blue sky and related expenses | 5,800 | |||
Miscellaneous | 500 | |||
Total | $ | 28,172 |
Noteholder | Original Loan Amount | Original Loan Date(s) | Loan Maturity Date | Loan Status | |||||
Ronald W. Hart | $ | 10,000 | 04/10/09 | 10/09/09 | Converted to 2007 Note | ||||
Dolores Maloof | $ | 25,000 | 04/17/09 | 05/27/09 | Converted to 2007 Note | ||||
Ronald W. Hart | $ | 6,000 | 04/23/09 | 10/22/09 | Converted to 2007 Note | ||||
John Imhoff | $ | 65,000 | 07/07/09 | 01/06/10 | Converted to 2007 Note |
(a)Exhibits |
EXHIBIT NO. | DESCRIPTION | ||
3.1 | Certificate of Incorporation, as amended (incorporated by reference to Exhibit 3.1 to the Quarterly Report on Form 10-Q for the period ended June 30, 2010, filed August 12, 2010). | ||
3.2 | Amended and Restated Bylaws (incorporated by reference to Exhibit 3. 1 to the current Report on Form 8 -K, filed March 23, 2012). | ||
4.1 | Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Amended Registration Statement on Form S-1/A (No. 333-22429), filed April 24, 1997). | ||
4.2 | Amended and Restated Loan Agreement by and among SpectRx, Inc., the Agent, and the Noteholders, dated March 1, 2007 (incorporated by reference to Exhibit 4.1 to the Quarterly Report on Form 10-QSB, filed August 24, 2007). | ||
4.3 | First Amendment to the Amended and Restated Loan Agreement (incorporated by reference to Exhibit 4.2 to the Quarterly Report on Form 10-QSB, filed August 24, 2007). | ||
4.4 | Amendment to Amended and Restated Loan Agreement (incorporated by reference to Exhibit 4.12 to the Quarterly Report on Form 10-Q for the period ended June 30, 2010, filed August 12, 2010). | ||
4.5 | Form of Warrant (incorporated by reference to Annex 1 to the proxy statement on Schedule 14A, filed February 3, 2010). | ||
4.6 | Form of Warrant Agreement (incorporated by reference to Exhibit 4 .1 to the Current Report on Form 8-K, filed September 14 , 2010). | ||
4.7 | Form of Warrant Agreement (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, filed September 2, 2011). | ||
4.8 | Form of Warrant Agreement (incorporated by reference to Exhibit 4 .1 to the Current Report on Form 8-K /A , filed November 28 , 2011). | ||
5.1 ** | Opinion of Jones Day regarding validity. | ||
10.1 | 1995 Stock Plan and form of Stock Option Agreement thereunder (incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-1 (No. 333-22429) filed February 27, 1997). | ||
10.2 | 2000 Amendment to the 1995 Stock Plan, as amended (incorporation by reference to Appendix 1 to the Definitive Proxy Statement filed April 24, 2000). | ||
10.3 | 2005 Amendment No. 2 to the 1995 Stock Plan, as amended (incorporated by reference to Appendix 1 to the proxy statement on Schedule 14A, filed May 10, 2005). | ||
10.4 | 2010 Amendment to the 1995 Stock Plan (incorporated by reference to Exhibit 10.3 to the Registration Statement on Form S-8 (File No. 333-178261), filed December 1, 2011. | ||
10. 5 | Consulting and Severance Agreement between SpectRx, Inc. and Mark A. Samuels, dated May 7, 2007 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K/A, filed June 5, 2007). | ||
10.6 | Assigned Task Agreement (incorporated by reference to Exhibit 10.17 to the Quarterly Report on Form 10-Q for the period ended March 31, 2010, filed May 13, 2010). | ||
10.7 | Assigned Task Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed April 1, 2011). | ||
10.8 | Agreement for Collaboration (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K, filed April 1, 2011). | ||
10.9 | Agreement for Re-Engineering and Manufacture of New BDS Device (incorporated by reference to Exhibit 10. 3 to the Quarterly Report on Form 10-Q for the period ended March 31 , 2010, filed May 16, 2011 ). | ||
10.10 | Form of Subscription Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed September 14, 2010). | ||
10.11 | Form of Subscription Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed November 28, 2010). | ||
10.12 | Registration Rights Agreement , dated August 30, 2011 (incorporated by reference to 10.2 to the Current Report on Form 8-K, filed September 2, 2011). | ||
10.13 | Agreement and Release, dated August 30, 2011 (incorporated by reference to 10.2 to the Current Report on Form 8-K, filed September 2, 2011). | ||
21.1 | Subsidiaries (incorporated by reference to Exhibit 21.1 to the Registration Statement on Form S-1 (No. 333-169755) filed October 5, 2010). | ||
23.1* | Consent of UHY LLP. | ||
23.2 | Consent of Jones Day (included in Exhibit 5.1). | ||
24.1 | Powers of Attorney (included at signature page of registration statement on Form S-1, filed October 5, 2010 ). | ||
101.1 | Interactive Data File* |
(a) | The undersigned registrant hereby undertakes: | ||
(1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: | ||
(i) | To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; | ||
(ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement. | ||
(iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; | ||
(2) | That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. | ||
(3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. | ||
(4) | That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: | ||
(i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; | ||
(ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; | ||
(iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and | ||
(iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. | ||
(b) | Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. |
GUIDED THERAPEUTICS, INC. | |||
By: | /s/ Mark L. Faupel | ||
President, Chief Executive Officer and Acting Chief Financial Officer |
DATE | SIGNATURE | TITLE | ||
April 2, 2012 | /s/ Mark L. Faupel | President, Chief Executive Officer, Acting Chief Financial Officer and Director (Principal Executive Officer and Principal Financial and Accounting Officer) | ||
Mark L. Faupel | ||||
* | Director | |||
Ronald W. Hart | ||||
* | Director | |||
John E. Imhoff | ||||
* | Director | |||
Michael C. James | ||||
* | Director | |||
Ronald W. Allen | ||||
* | Director | |||
Jonathan M. Niloff |
April 2, 2012 | By: | /s/ Mark L. Faupel | |
Mark L. Faupel | |||
Attorney- in-Fact |
Exhibit Number | Description of Exhibits | |
23.1 | Consent of UHY LLP. | |
101.1 | Interactive Data File. |