Item 1.01 Entry into a Material Definitive Agreement.
On September 17, 2021, Galectin Therapeutics Inc. (the "Company") and Richard E.
Uihlein entered into a loan agreement in the aggregate of twenty million dollars
($20,000,000) (the "Loan Agreement") to be funded in two closings and evidenced
by two separate unsecured convertible promissory notes. The first of the two
promissory notes was also executed and delivered on September 17, 2021, (the
"September 2021 Note") to evidence the first loan in the principal amount of ten
million dollars. The second closing under the Loan Agreement for the remaining
ten million dollars will occur on or before December 17, 2021.
The September 2021 Note has a maturity date of September 17, 2025 and is
convertible into the Company's common stock at a conversion price equal to $8.64
per share at the option of the noteholder, which is 228% of the closing price of
our stock on September 16, 2021. The September 2021 Note bears interest at the
rate of two percent (2%) per annum, compounded annually, and accrues additional
interest at a rate of two and one-half percent (2.5%) per quarter (the
"Additional Interest") beginning on the date of issuance of the September 2021
Note and ending on the maturity date; provided however, that such Additional
Interest is payable if and only if the noteholder elects to convert the entire
balance of the September 2021 Note into the Company's common stock.
The terms of the second note will be the same as the terms provided under the
September 2021 Note except that the conversion price will be the greater of 228%
of the closing price of our common stock the day prior to the second closing or
$5.00, whichever is greater.
Under the terms of the Loan Agreement, the Line of Credit Letter Agreement (the
"Line of Credit") for $10 million between the Company and Richard E. Uihlein,
dated December 19, 2017, and most recently amended on January 11, 2019, which by
its terms would otherwise expire on December 31, 2021, will be terminated upon
closing of the second $10 million unsecured convertible loan in December 2021.
Currently there are no borrowings under the Line of Credit.
The foregoing description of the Loan Agreement and September 2021 Note do not
purport to be complete and the terms of the Loan Agreement and September 2021
Note are subject to, and qualified in their entirety by reference to the Loan
Agreement and September 2021 Note, which are filed herewith as Exhibit 10.1 and
Exhibit 10.2, respectively, and are incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of Registrant.
The information contained in Item 1.01 above is incorporated herein by
reference.
Item 3.02 Unregistered Sales of Equity Securities.
The information contained in Item 1.01 above is incorporated herein by
reference.
The sale and issuance of the Note as disclosed in Item 1.01 of this Current
Report on Form 8-K has been determined to be exempt from registration under the
Act in reliance on Section 4(2) of the Act and Rule 506 of Regulation
D promulgated under the Act.
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Item 8.01 Other Items.
On September 21, 2021, Galectin Therapeutics Inc. (the "Company) issued the
press release attached hereto as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
Exhibit No.
10.1 Loan Agreement, dated September 17, 2021
10.2 Unsecured Convertible Promissory Note, dated September 17, 2021
99.1 Press release, dated September 21, 2021
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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