UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 30, 2008
AETHLON MEDICAL, INC.
(Exact name of Registrant as specified in charter)
NEVADA 000-21846 13-3632859
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification Number)
3030 Bunker Hill Street, Suite 4000
San Diego, California 92109
(Address of principal executive offices)
Registrant's telephone number, including area code: (858) 459-7800
NOT APPLICABLE
(Former name or former address, if changed since last report)
FORWARD LOOKING STATEMENTS
This Form 8-K and other reports filed by Registrant from time to time
with the Securities and Exchange Commission (collectively the "Filings") contain
or may contain forward looking statements and information that are based upon
beliefs of, and information currently available to, Registrant's management as
well as estimates and assumptions made by Registrant's management. When used in
the Filings the words "anticipate, "believe", "estimate", "expect", "future",
"intend", "plan" or the negative of these terms and similar expressions as they
relate to Registrant or Registrant's management identify forward looking
statements. Such statements reflect the current view of Registrant with respect
to future events and are subject to risks, uncertainties, assumptions and other
factors relating to Registrant's industry, Registrant's operations and results
of operations and any businesses that may be acquired by Registrant. Should one
or more of these risks or uncertainties materialize, or should the underlying
assumptions prove incorrect, actual results may differ significantly from those
anticipated, believed, estimated, expected, intended or planned.
Although Registrant believes that the expectations reflected in the
forward looking statements are reasonable, Registrant cannot guarantee future
results, levels of activity, performance or achievements. Except as required by
applicable law, including the securities laws of the United States, Registrant
does not intend to update any of the forward-looking statements to conform these
statements to actual results.
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On December 30, 2008, Registrant entered into a Modification and
Amendment Agreement with three investors (the "Modification Agreement"). Under
the terms of the Modification Agreement, notes originally issued December 5,
2007, in an aggregate principal amount of $450,000, and on January 18, 2008 in
an aggregate principal amount of $220,000 (collectively, the "Original Notes")
were modified to extend the maturity date and include conversion rights on the
part of the holders ("Investors"). In addition, the Registrant issued new notes
(the "New Notes") to the Investors, representing amounts due for accrued but
unpaid interest under the Original Notes in the aggregate amount of $217,425,
and amounts due for accrued but unpaid damages under the Original Notes in the
aggregate amount of $355,786.01. All of the New Notes and the amended Original
Notes will accrue interest at a rate of ten percent (10%) per annum and have a
maturity date of July 1, 2009.
All of the New Notes and the amended Original Notes provide for
conversion rights on the part of the Investors at any time prior to the maturity
date of the notes. The principal and interest under the New Notes and the
amended Original Notes, subject to adjustment as provided in the Modification
Agreement, are convertible into shares of the common stock of the Registrant at
the "Conversion Price" per share equal to the lesser of (i) $0.25 and (ii)
eighty percent (80%) of the three day average of the closing bid prices of the
Common Stock as reported by Bloomberg L.P. on the date preceding a conversion
date subject to a "Floor Price" of $0.15. All of the New Notes and the amended
Original Notes contain an antidilution feature, whereby upon the issuance by
Registrant of common stock or securities convertible into common stock at a
price per share less than the Floor Price, the Conversion Price shall be
adjusted downward to match such new lower issuance price. The Conversion Price
will also adjust equitably for certain events, such as recapitalizations, stock
splits, dividends and similar events affecting all classes of securities.
Under the terms of the Modification Agreement, in addition to the
modification of the Original Notes and the issuances of the New Notes, the
Registrant has extended the exercise period of the common stock purchase
warrants original issued on December 5, 2007 and January 18, 2008 (in connection
with the issuance of the Original Notes), to July 1 2012.
The foregoing description of the material terms of the Modification
Agreement, the amended Original Notes and New Notes does not purport to be
complete and is qualified in its entirety by the Exhibits attached hereto, each
of which is incorporated herein by reference.
ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES
The information set forth in Item 1.01 is hereby incorporated into this
Item 3.02. The Modification Agreement and related Notes were made in reliance on
the exemption from registration contained in Section 4(2) of the Securities Act
of 1933, as amended, and Rule 506 of Regulation D promulgated thereunder. Each
Investor represented to the Registrant that such Investor was an "accredited
investor" as such term is defined under Regulation D and the offering did not
involve any form of general solicitation or general advertising.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
EXHIBITS
ITEM NO. DESCRIPTION
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10.1 Modification and Amendment Agreement dated December 30, 2008
10.2 Form of Interest Note dated December 30, 2008
10.3 Form of Liquidated Damages Note dated December 30, 2008
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 hereunto duly authorized.
Date: January 2, 2009
AETHLON MEDICAL, INC.
By: /S/ JAMES A. JOYCE
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James A. Joyce
Chief Executive Officer