April 15, 2005
Mail Stop 0409
Michael I. Ruxin, M.D.
Chairman of the Board and Chief Executive Officer
Global Med Technologies, Inc.
12600 West Colfax, Suite C-420
Lakewood, CO 80215
Re: Registration Statement on Form S-1
Filed March 16, 2005
Registration No. 333-123378
Dear Dr. Ruxin:
We have limited our review of your registration statement to
the
terms of the financing you entered into with Fusion Capital.
Where
indicated, we think you should revise your document in response to
these comments. If you disagree, we will consider your
explanation
as to why our comment is inapplicable or a revision is
unnecessary.
Please be as detailed as necessary in your explanation. In some
of
our comments, we may ask you to provide us with supplemental
information so we may better understand your disclosure. After
reviewing this information, we may or may not raise additional
comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or any other aspect
of
our review. Feel free to call us at the telephone numbers listed
at
the end of this letter.
General
1. Please file your supplemental response, dated January 7, 2005,
on
EDGAR that replied to our comment letter with respect to the S-1
that
was filed on December 6, 2004 and withdrawn on March 15, 2005
(File
No. 333-121030).
Management`s Discussion and Analysis of Financial Condition and
Results of Operations
2. Please disclose how you intend to account for the additional
commitment shares that will be issued to Fusion Capital each time
a
purchase of securities under the Common Stock Purchase Agreement
is
made. Please consider disclosing the accounting treatment under
the
"Critical Accounting Policies" section of MD&A.
The Fusion Capital Transaction
3. Please revise here and in the risk factors section to include a
detailed discussion of the price and volume volatility that will
result from the daily sales to Fusion Capital and potential daily
sales by Fusion Capital. In that connection, please revise to
include a discussion of the fact that each daily sale to Fusion
Capital could make a subsequent day`s sale more dilutive by
decreasing the prices of the subsequent day`s sales.
4. We note the risk factor discussion regarding the fact that you
may
require additional financing if the number of shares to be issued
to
Fusion Capital exceeds 10 million. Please revise here, in the
risk
factors section and in MD&A to include an enhanced discussion of
the
risk and consequences of the likelihood that you will not receive
$8
million from share issuances to Fusion Capital because of the
dilutive effect of sales and because of the 9.9% limitation on
Fusion
Capital`s ownership of shares.
5. In this connection we note your disclosure in MD&A that you
plan
to use the first $4 million in proceeds from Fusion Capital to
redeem
your $3.5 million in Series AA Convertible Redeemable Preferred
Stock
and payoff the outstanding $529,000 in related party debt. Please
revise the MD&A to clarify to whom such debt was outstanding and
supplementally advise as to the identity of the preferred
stockholder, including whether they are affiliated individuals or
entities.
6. We note your statement that in MD&A that "assuming the
Company`s
stock price remains at $2.26 per share, the Company believes it
would
be able to redeem its outstanding Series AA Preferred Stock and
pay
off the outstanding debt within approximately 4 months of the
common
shares being registered and sold under the terms of the Purchase
Agreement." Please revise this statement and the risk factors
section to clarify that sales under the Fusion Capital Purchase
Agreement will have the effect of decreasing the price of the
stock
and may result in the issuance of additional shares so that Fusion
Capital reaches its 9.9 percent ownership limit prior to the four-
month timeframe included here.
7. We note your statement that "in connection with each purchase"
you
will issue up to 486,815 shares of common stock to Fusion Capital
as
an additional commitment fee. Please revise to clarify whether
486,815 shares represents the upper limit over the course of the
agreement.
8. We note your statement that the additional shares will be
issued
"pro rata based on the proportion that a dollar amount purchased
by
Fusion bears to the $8.0 million aggregate amount under the
purchase
agreement with Fusion Capital." Please revise to clarify the
operation of this formula and consider using an example for
clarification.
9. Please enhance your disclosure regarding the additional
commitment
fee shares to discuss the fact that the economic effect of these
issuances is lower the average purchase price that Fusion Capital
is
obligated to pay for your shares. In addition, please disclose
the
dilutive effect on stockholders that these issuances will have.
10. We note your statement that you estimate that you will issue
no
more than 10 million shares to Fusion Capital. In light of the
fact
that you are under no obligation to limit such issuances to 10
million shares, please revise your disclosure to reflect the
possibility that you will register additional shares.
11. We note your statement that Fusion Capital has agreed that
neither it nor any of its affiliates will engage in any direct or
indirect short-selling or hedging of your stock during any time
prior
to the termination of the Stock Purchase Agreement. Please
confirm
that it will not sell shares prior to their purchase as opposed to
prior to the contractual obligation to purchase such shares.
* * * *
As appropriate, please amend your registration statement
in
response to these comments. You may wish to provide us with
marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. Please
understand that we may have additional comments after reviewing
your
amendment and responses to our comments.
Notwithstanding our comments, when the company requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such
request,
acknowledging that:
* should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
* the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the company from its full responsibility for the adequacy
and
accuracy of the disclosure in the filing; and
* the company may not assert this action as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in connection with our review of
your
filing or in response to our comments on your filing.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the proposed public
offering
of the securities specified in the above registration statement.
We
will act on the request and, pursuant to delegated authority,
grant
acceleration of the effective date.
We direct your attention to Rules 460 and 461 regarding
requesting acceleration of a registration statement. Please allow
adequate time after the filing of any amendment for further review
before submitting a request for acceleration. Please provide this
request at least two business days in advance of the requested
effective date.
Please contact Owen Pinkerton, Attorney-Advisor, at (202)
942-
1971 or me at (202) 942-1960 with any other questions.
Sincerely,
Elaine Wolff
Branch Chief
cc: Clayton E. Parker, Esq. (via facsimile)
Ronald S. Haligman, Esq.
Kirkpatrick & Lockhart LLP
??
??
??
??
Global Med Technologies, Inc.
Page 4