Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 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): March 8, 2024

Calidi Biotherapeutics, Inc.

(Exact name of registrant as specified in its charter)

Delaware

001-40789

86-2967193

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(I.R.S. Employer

Identification No.)

4475 Executive Dr., Suite 200,

San Diego, CA

92121

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (858) 794-9600

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Title of each class	Trading Symbol	Name of each exchange on which registered

Common stock, par value $0.0001 per share	CLDI	NYSE American LLC

Redeemable warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50 per share	CLDIWS	NYSE American LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry into a Material Definitive Agreement.

On March 8, 2024, Calidi Biotherapeutics, Inc. (the “Company,” “we” or “our”) entered into a settlement agreement (the “Settlement Agreement”) with an investor who previously entered into a series of related agreements including (i) an agreement with Calidi Cure, LLC, an affiliate of the Company, in connection with an equity financing to fund the purchase of Series B Convertible Preferred Stock of Calidi Biotherapeutics (Nevada), Inc. (formerly Calidi Biotherapeutics, Inc.), a Nevada corporation and our wholly-owned subsidiary (“Calidi”); (ii) a Non-Redemption Agreement with the Company; (iii) an OTC Equity Prepaid Forward Purchase Agreement with the Company; and (iv) a Subscription Agreement with the Company (items (i) through (iv) collectively “the Supplemental Funding Agreements”) for the purpose of satisfying the “Minimum Cash Condition” required under the Business Combination agreement between First Light Acquisition Group, Inc., and Calidi, among others, which was consummated on September 12, 2023.

Pursuant to the Settlement Agreement, (i) the investor purchased a $2.0 million convertible note from the Company for cash and (ii) the Company issued to the investor a $1.5 million convertible note in consideration for the settlement of all claims related to the Supplemental Funding Agreements. The $2.0 million convertible note and $1.5 million convertible note are collectively herein referred to as the “Convertible Notes”. The Settlement Agreement also includes a mutual release of all claims by both parties.

The Convertible Notes bear semiannual interest at 10.0% per annum and each mature on March 8, 2028, unless due earlier due to an event of a default. After the earlier of 180 days or the effective date of a registration statement registering the Company’s common stock underlying the Convertible Notes, the Company may prepay the Convertible Notes, including any interest earned thereon, without penalty. The Convertible Notes also provide the investor a right to convert in whole or in part, the Principal Amount (as defined in the Convertible Notes) and accrued interest into shares of our common stock at an initial note conversion price equal to 94% of the 10-day VWAP ending the business day preceding execution of the Convertible Notes subject to a reset note conversion price equal to 94% of 10-day VWAP ending on the thirtieth (30th) day after the effective date of the registration statement registering the common stock underlying the Convertible Notes. In the event the Company completes a financing (i) of at least $8 million in an offering registered with the Securities and Exchange Commission (the “SEC”); or (ii) of at least $2 million with a non-affiliated purchaser at an effective price of at least 150% of the initial note conversion price, then the Convertible Notes will be subject to mandatory conversion at the lower of the initial note conversion price and reset note conversion price.

On March 11, 2024, the Company entered into an amendment to the $1.5 million convertible note (the "Note Amendment"), which amended Section 1(c) pertaining to conditions to closing, by deleting Section 1(c)(iii) in its entirety, which previously provided that the Principal Amount be wired to the Company’s bank account. As disclosed above, the $1.5 million convertible note was issued by the Company to the investor in consideration for the settlement of all claims related to the Supplemental Funding Agreements.

The foregoing description of the Settlement Agreement, the Convertible Notes and Note Amendment do not purport to be complete and is qualified in their entirety by reference to the full text of the Settlement Agreement, the Convertible Notes and the Note Amendment, which are attached hereto as Exhibits 10.1, 10.2, 10.3 and 10.4 respectively, and incorporated herein by reference.

Item 1.02 Termination of a Material Definitive Agreement.

Pursuant to the terms of the Settlement Agreement as described in Item 1.01, which is incorporated herein by reference, upon the execution of the Settlement Agreement, all outstanding obligations of the Supplemental Funding Agreements were terminated.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information included in Item 1.01 of this Current Report is incorporated by reference into this Item 2.03.

Item 3.02 Unregistered Sales of Equity Securities

The information set forth under Item 1.01 in this Form 8-K is incorporated herein by reference.

The issuance of the Convertible Notes and the shares of common stock that may be issuable upon conversion of the Convertible Notes (the “Securities”) were made to an accredited investor in reliance on the exemption from registration afforded by Section 4(a)(2) of the Securities Act, as amended (the “Securities Act”) as provided in Rule 506(b) of Regulation D promulgated thereunder. The offering of the Securities was not conducted in connection with a public offering, and no public solicitation nor advertisement was made or relied upon by the investor in connection with the offering.

Item 9.01 Financial Statements and Exhibits.

(d)

Exhibits

Exhibit No.		Description
10.1†		Settlement Agreement dated March 8, 2024
10.2		Form of Convertible Promissory Note ($2,000,000)
10.3		Form of Convertible Promissory Note ($1,500,000)
10.4		Form of Amendment to Convertible Note
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

† Certain information contained in this exhibit has been omitted because it is both (i) not material and (ii) is the type that the Company treats as private or confidential.

SIGNATURE

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.

	Calidi Biotherapeutics, Inc.
Dated: March 12, 2024
	By:	/s/ Wendy Pizarro
	Name:	Wendy Pizarro
	Title:	Chief Legal Officer

Exhibit 10.1

CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH NOT MATERIAL AND IS THE TYPE THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL. [*****] INDICATES THAT INFORMATION HAS BEEN REDACTED OR OMITTED.

Execution Copy – 03/08/2024

SETTLEMENT AGREEMENT AND RELEASE OF ALL CLAIMS

This Settlement Agreement and Release of All Claims (the “Settlement Agreement”) is made by and between [*****] (collectively, “[*****]” or the “[*****]”), on the one hand, and Calidi Biotherapeutics, Inc., a Delaware corporation, formerly First Light Acquisition Group, Inc. (“FLAG,” a Special Purpose Acquisition Company (“SPAC”), and together with Calidi Biotherapeutics, Inc., “Calidi”), Calidi Cure, LLC, a Delaware limited liability company and an affiliate of Calidi (“Calidi Cure”) and Allan Camaisa, an individual (erroneously described as Seller Representative in the OTC Equity Prepaid Forward Purchase Agreement referenced below and an affiliate of Calidi (“Camaisa”) on the other hand (Calidi, Calidi Cure, and Camaisa collectively the “Calidi Party”) (the [*****] and the Calidi Party are referred to collectively herein as the “Parties” and individually as a “Party”). This Settlement Agreement is intended to resolve any and all disputes between the Parties and their affiliates as set forth below and extinguish those obligations described below.

RECITALS

WHEREAS, on or about August 29, 2023, [*****] simultaneously entered into and executed related agreements including (i) an agreement with Calidi Cure to fund the purchase of Calidi Series B Preferred Stock; (ii) a Non-Redemption Agreement with FLAG; (iii) an OTC Equity Prepaid Forward Purchase Agreement with Calidi, FLAG, and Camaisa (“Confirmation”); and (iv) a Subscription Agreement with FLAG (items (i) through (iv) of this preamble sentence collectively “the Supplemental Funding Agreements”) for the purposes of helping FLAG to satisfy the “Minimum Cash Condition” requirement of Article 6.1(g) of the Agreement and Plan of Merger (the “Merger Agreement” or “Business Combination Agreement”) between FLAG, Calidi Biotherapeutics, Inc., a Nevada corporation (the “Target), and several or their subsidiaries and related parties, entered into on January 9, 2023, as amended;

WHEREAS, the Parties disagree, and have voiced disagreement as set forth in various correspondence by the Parties and their counsel, regarding the meaning, interpretation, effect, and/or enforceability of certain terms and conditions in the Supplemental Funding Agreements, including, without limitation: (i) the meaning of “Recycled Shares,” “Backstop Investor Shares,” and “Share Consideration Shares” in the Supplemental Funding Agreements; (ii) whether [*****] “Pricing Date Notice” as defined in the Confirmation correctly set forth the number of “Recycled Shares” and “Additional Shares”; (iii) whether Calidi owes additional payment(s) to [*****] pursuant to the Supplemental Funding Agreements; and (iv) whether conditions precedent for shares purchased by [*****] to be considered Recycled Shares, Backstop Investor Shares, and Share Consideration Shares existed, were met, or were not met (the “Dispute”).

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WHEREAS, the Parties wish to resolve the Dispute in connection with the Supplemental Funding Agreements, including, without limitation, all issues concerning whether payment is due and owing to any Party, and/or the amount, timing, consideration, of such payment;

WHEREAS, on February 27, 2024, the Parties executed a Summary of Binding Terms Convertible Notes Financing, which set forth a binding and enforceable agreement as to the material terms associated with a settlement of the Dispute, all of which is incorporated herein by reference and memorialized pursuant to this Settlement Agreement; and;

WHEREAS, the Parties agree that this Settlement Agreement and the terms and conditions contained herein, is a Full Release by the Parties of the Supplemental Funding Agreements and other potential liabilities or obligation, as provided herein.

AGREEMENT

NOW, THEREFORE, in consideration of the covenants and agreements contained in this Settlement Agreement, and the other valuable consideration described herein, the sufficiency of which is hereby acknowledged by all Parties, the Parties agree as follows.

1. [*****] Purchase of Two Million Dollar ($2,000,000) Convertible Note. Upon the execution of this Settlement Agreement, [*****] will purchase from Calidi a Two Million Dollar ($2,000,000) convertible note in a form identical to in Exhibit A hereto. Upon the execution of this Settlement Agreement, [*****] will wire $2,000,000 to Calidi.

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2. Issuance of One Million Five Hundred Thousand Dollar ($1,500,000) Convertible Note. Upon the execution of this Settlement Agreement, Calidi will issue to [*****] a One Million, Five Hundred Thousand Dollar ($1,500,000) convertible note in a form identical to Exhibit B hereto.

3. Termination of Outstanding Obligations Under the Supplemental Funding Agreements. Upon the execution of this Settlement Agreement, all outstanding obligations of the Supplemental Funding Agreements will terminate.

4. Reasonable Assistance of [*****] in Third Party Claims. [*****] agrees to use reasonable efforts to cooperate with Calidi in any claim brought by Calidi against third parties to this Settlement Agreement related to the Supplemental Funding Agreements.

5. Attorney Fees. Parties agree to bear their own attorney fees and legal costs in connection with this Settlement Agreement. However, after closing of the respective convertible notes described in Section 1 and Section 2 herein, Calidi will pay [*****] up to $15,000 as reimbursement for reasonable and documented attorney’s fees incurred in connection with the structuring of the convertible notes. Furthermore, upon prior written consent, which shall not be unreasonably withheld, Calidi agrees to pay [*****] attorney fees and legal costs related to [*****] reasonable efforts to cooperate in any of Calidi’s claims against third parties.

6. Mutual Release of all Claims.

a. Release by [*****]. [*****], on behalf of itself, its predecessors, successors, direct and indirect parent companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates, and assigns, and its and their past, present, and future officers, directors, shareholders, interest holders, members, partners, attorneys retained in connection with the Dispute, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them, hereby releases and forever discharges Calidi Party, together with its predecessors, successors, direct and indirect parent companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates, and assigns, and its and their past, present, and future officers, directors, shareholders, interest holders, members, partners, attorneys retained in connection with the Dispute, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under or in concert with them (“[*****] Releasees”), and each of them, from all known and unknown charges, complaints, claims, grievances, liabilities, obligations, promises, agreements, controversies, damages, actions, causes of action, suits, rights, demands, costs, losses, debts, penalties, fees, wages, expenses (including attorneys’ fees and costs actually incurred), and punitive damages, of any nature whatsoever, whether at law or in equity, or known or unknown, which [*****] has, or may have had, against Calidi Party, whether or not apparent or yet to be discovered, or which may hereafter develop, for any acts, claims, or omissions related to or arising from:

(i) The Dispute; and/or

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(ii) The Supplemental Funding Agreements.

This Settlement Agreement resolves any claim for relief that has or could have been alleged by [*****] against Calidi Party related to or arising from the Dispute or the Supplemental Funding Agreements, no matter how characterized, including, without limitation, compensatory damages, damages for breach of contract, bad faith damages, reliance damages, liquidated damages, punitive damages, costs, and attorneys’ fees. Nothing in this Settlement Agreement shall be construed as, or constitute, a release of any Party’s right to enforce the terms of this Settlement Agreement.

[*****] certifies that it has read the provisions of California Civil Code Section 1542 and has consulted its own counsel regarding that section. [*****] waives any and all rights under California Civil Code Section 1542, which states:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.

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[*****] agrees and acknowledges that the released claims extend to and include unknown and unsuspected claims.

[*****] has made an investigation of the facts pertaining to this Settlement Agreement and to the released claims as it deems necessary. [*****] is aware that it may hereafter discover facts in addition to, contrary to, or different from those it now knows or believes to be true with respect to the matters set forth herein. Nevertheless, it is the intention of [*****] to fully, finally, and forever settle and release all claims of any kind or nature whatsoever that were in existence as of the date of this Settlement Agreement. In furtherance of the Parties’ intent, the release in this Settlement Agreement shall remain in full and complete effect notwithstanding the discovery or existence of any additional, contrary, or different facts.

b. Release by Calidi Party. Calidi Party, on behalf of itself, its predecessors, successors, direct and indirect parent companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates, and assigns, and its and their past, present, and future officers, directors, shareholders, interest holders, members, partners, attorneys retained in connection with the Dispute, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them, hereby releases and forever discharges [*****], together with its predecessors, successors, direct and indirect parent companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates, and assigns, and its and their past, present, and future officers, directors, shareholders, interest holders, members, partners, attorneys retained in connection with the Dispute, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under or in concert with them (“Calidi Releasees”), and each of them, from all known and unknown charges, complaints, claims, grievances, liabilities, obligations, promises, agreements, controversies, damages, actions, causes of action, suits, rights, demands, costs, losses, debts, penalties, fees, wages, medical costs, pain and suffering, mental anguish, emotional distress, expenses (including attorneys’ fees and costs actually incurred), and punitive damages, of any nature whatsoever, whether at law or in equity, or known or unknown, which Calidi Party has, or may have had, against [*****], whether or not apparent or yet to be discovered, or which may hereafter develop, for any acts, claims, or omissions related to or arising from:

(i) The Dispute; and/or

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(ii) The Supplemental Funding Agreements.

This Settlement Agreement resolves any claim for relief that has or could have been alleged by Calidi Party against [*****] related to or arising from the Dispute or the Supplemental Funding Agreements, no matter how characterized, including, without limitation, compensatory damages, damages for breach of contract, bad faith damages, reliance damages, liquidated damages, damages for humiliation and embarrassment, punitive damages, costs, and attorneys’ fees. Nothing in this Settlement Agreement shall be construed as, or constitute, a release of any Party’s right to enforce the terms of this Settlement Agreement.

Calidi Party certifies that they have read the provisions of California Civil Code Section 1542 and has consulted their own counsel regarding that section. Calidi Party waives any and all rights under California Civil Code Section 1542, which states:

Calidi Party agrees and acknowledges that the released claims extend to and include unknown and unsuspected claims.

Calidi Party has made an investigation of the facts pertaining to this Settlement Agreement and to the released claims as they deem necessary. Calidi Party is aware that they may hereafter discover facts in addition to, contrary to, or different from those they now know or believe to be true with respect to the matters set forth herein. Nevertheless, it is the intention of Calidi Party to fully, finally, and forever settle and release all claims of any kind or nature whatsoever that were in existence as of the date of this Settlement Agreement. In furtherance of the Parties’ intent, the release in this Settlement Agreement shall remain in full and complete effect notwithstanding the discovery or existence of any additional, contrary, or different facts.

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7. Other Actions. The Parties hereby agree that they have not filed any other complaints against any of the Parties in any state or federal court; that they will not file any complaint arising out of or related to the Dispute or the Supplemental Funding Agreements at any time hereafter other than as it relates to the enforcement of this Settlement Agreement; and that if such court assumes jurisdiction of any such complaint against any of the Parties whenever filed other than the enforcement of this Settlement Agreement, they will request such court to dismiss the matter with prejudice.

8. No Admission of Liability. This Settlement Agreement and compliance with it shall not be construed as an admission by the Parties of any liability whatsoever or as an admission by a Party of any wrongdoing including any violation of any rights under any common law, statute, or contract. The Parties specifically disclaim any wrongdoing and disclaim any liability to each other for any violation of their rights, including any violation of common law, statute, or contract.

9. Representations and Warranties.

	a.	No Outstanding or Known Future Claims or Causes of Actions. Each Party represents and warrants that it has not filed with any governmental agency or court any type of action or report against the other Party, and currently knows of no existing act or omission by the other Party that may constitute a claim or liability excluded from the released claims set out in Section 6, above.

	b.	No Assignment of Claims. The Parties expressly warrant that they have not transferred to any other person or entity any of the rights or causes of action released in this Settlement Agreement. Each Party represents and warrants that they are the rightful owners of and have not encumbered, assigned, or transferred, nor will they in the future attempt to encumber, assign, or transfer, any claim for relief or cause of action released herein.

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	c.	Parties’ Authority to Settle. Each Party represents and warrants that they has full authority to enter into, deliver, and perform under this Settlement Agreement, and that all acts and actions have been taken to grant such authority, and that no third-party consent, which has not already been obtained, is required.

	d.	Signatories’ Authority to Execute Settlement Agreement. Each signatory to this Settlement Agreement represents and warrants that they are authorized to execute this Settlement Agreement on behalf of the Party for whom executed this Settlement Agreement.

	e.	No Violation of By-laws, Covenants, or Restrictions. Each Party warrants and represents that the Party’s execution of this Settlement Agreement, if an entity, is not in violation of any By-law, Operating Agreement, Covenants, and/or other restrictions placed upon them by their respective entities.

	f.	No Reliance Upon Representations Other Than Settlement Agreement. The Parties represent and acknowledge that in executing this Settlement Agreement they do not rely and have not relied upon any representation or statement made by any other Party or by the agents, attorneys or representatives of the other Party with regard to the subject matter of this Settlement Agreement, or its basis, or the effects of this Settlement Agreement other than those representations specifically set forth in this written document.

10. No Waiver. The failure of any Party to insist upon strict adherence to any term of this Settlement Agreement on any occasion shall not be deemed a waiver or deprive any Party of the right thereafter to insist upon strict adherence to that term or any other term of this Settlement Agreement. Any waiver must be in a writing signed by the Party granting the waiver and must expressly state that it is a waiver of such provision of this Settlement Agreement.

11. Effect of Partial Invalidity. Should any part, term or provision of this Settlement Agreement be declared or determined by any Court of competent jurisdiction to be wholly or partially illegal, invalid, or unenforceable, the legality, validity, and enforceability of the remaining parts, terms or provisions of this Settlement Agreement shall not be affected thereby. Said illegal, invalid or unenforceable part, term or provision shall be deemed not to be a part of this Settlement Agreement.

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12. Entire Agreement. This Settlement Agreement and the Summary of Binding Terms Convertible Notes Financing, dated February 27, 2024, which is incorporated herein by reference, constitute the entire agreement between the Parties regarding settlement of the Dispute or settlement of actual or potential claims arising out of or related to the Supplemental Funding Agreements. This Settlement Agreement supersedes all prior agreements, written or oral, between or among the Parties regarding those the settlement of those claims, other than the Summary of Binding Terms Convertible Notes Financing. No other agreement, statement, or promise made by one Party to another as to any matter addressed in this Settlement Agreement shall be binding or valid. This Settlement Agreement cannot be orally modified. Any amendment or modification to this Settlement Agreement must be in writing, signed by a duly authorized representative of each Party. The Parties further represent that they are unaware of any agreement or promise, written or oral, between Calidi Releasees and/or anyone else and [*****] Releasees and/or anyone else, that could serve as the basis for any claim or action against Calidi Releasees or [*****] Releasees, respectively, that have not been released in this Settlement Agreement.

13. Interpretation of Agreement. The Parties agree that any legal rule to the effect that ambiguities shall be resolved against the drafting party shall not apply in any interpretation of this Settlement Agreement.

14. Governing Law and Jurisdiction. This Settlement Agreement shall be interpreted in accordance with and governed by the internal laws of the State of Delaware without giving effect to any choice of law rule that would cause the application of the laws of any jurisdiction other than the internal laws of the State of Delaware to the rights and duties of the parties. All disputes and controversies arising out of or in connection with this Settlement Agreement shall be resolved exclusively by the state or federal courts located in New Castle County in the State of Delaware, and each Party hereto agrees to submit to the jurisdiction of said courts and agrees that venue shall lie exclusively with such courts.

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15. Counterparts. The Parties may execute this Settlement Agreement in counterparts which shall, in the aggregate, be signed by all the Parties; and each counterpart shall be deemed an original instrument as against the party who has signed it.

16. Voluntary and Knowing. This Settlement Agreement is executed voluntarily and without any duress or undue influence on the part or behalf of the parties hereto.

17. Confidentiality. The Parties represent and agree that they have and will keep the terms and amount of this Settlement Agreement completely confidential, and that they will not hereafter disclose any information concerning this Settlement Agreement to anyone without prior notice to the other Party; provided, however, that the Parties may make such disclosure to their immediate family, current and prospective limited partners, and professional representatives (e.g., attorneys, custodians, accountants, auditors, tax preparers). If any disclosures are made as provided in this paragraph, each individual shall first be informed of and agree to be bound by this confidentiality clause, or other such disclosures required by law to enforce this Settlement Agreement. Notwithstanding the foregoing, in the event that Calidi has been advised by its counsel that the terms of this Settlement Agreement must be disclosed in periodic filings with the Securities and Exchange Commission (“SEC”) and filed as an exhibit to filings with the SEC, it may disclose the contents of this Settlement Agreement and such Settlement Agreement, including any exhibits thereto with the SEC. In the event that Calidi discloses certain terms and conditions of this Settlement Agreement in an SEC filing or as an exhibit to an SEC filing (“Publicly Disclosed Terms”) and such Publicly Disclosed Terms are unredacted and become part of the public domain, then [*****] will no longer have any obligation of Confidentiality related to the Publicly Disclosed Terms under this paragraph.

18. Cooperation. Each Party agrees to take all actions and to make, deliver, sign, and file any other documents and instruments necessary to carry out the terms, provisions, purpose, and intent of this Settlement Agreement.

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I, having read the foregoing Settlement Agreement and Release of All Claims and knowing the contents thereof, am effecting this Settlement and executing this Release after having the opportunity to obtain legal advice from counsel, and I sign the same as my own free act.

	Calidi Biotherapeutics, Inc.

Dated: March 8, 2024	/s/ Allan Camaisa
	Allan Camaisa, Chief Executive Officer

	Calidi Cure, LLC

	/s/ Allan Camaisa
Dated: March 8, 2024	Allan Camaisa, Manager

	Allan Camaisa, an Individual

	/s/ Allan Camaisa
Dated: March 8, 2024	Allan Camaisa, an Individual

	[*]

	/s/ [*****]
Dated: March 8, 2024	[*****], General Partner
	[*****], Managing Member

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Exhibit A

Exhibit B

Exhibit 10.2

CALIDI BIOTHERAPEUTICS, INC.
CONVERTIBLE PROMISSORY NOTE

$2,000,000.00	San Diego, California
	March 8, 2024

FOR VALUE RECEIVED, Calidi Biotherapeutics, Inc., a Delaware corporation (“Borrower”), hereby unconditionally promises to pay to [__________], or its registered assigns____________ (“Holder”), in lawful money of the United States of America in the principal amount of Two Million Dollars ($2,000,000.00) (“Principal Amount”) pursuant to that certain Settlement Agreement and Release of All Claims dated March 8, 2024, by and among Borrower and Holder (the “Settlement Agreement”), together with interest thereon in accordance with the terms hereof, from the date hereof until the date on which this Convertible Promissory Note (the “Note”) is paid in full. “Closing” means the closing of the issuance of the Note pursuant to Section 1(c) and the terms and conditions hereunder.

1. Terms of Note.

(a) Interest Rate. Interest on the then outstanding Principal Amount of this Note shall accrue semiannually at a rate per annum equal to ten percent (10.0%), simple interest beginning on the date of this Note. All interest shall be calculated on the basis of the actual daily balances of Principal Amount outstanding for the exact number of days elapsed, using a year of three hundred sixty-five (365) days. All interest shall accrue and shall be payable on the Maturity Date in cash, or at the election of the Borrower, in-kind on the then outstanding amount of the Obligations by increasing the principal amount of the Obligations by the amount of such scheduled interest payment, or in-kind in Common Stock of the Borrower at the then-prevailing Note Conversion Price, provided the Borrower’s voting common stock is traded on an established public trading market.

(b) Maturity Date. Except as otherwise provided herein, the entire outstanding Principal Amount of this Note, together with all accrued but unpaid interest payable thereon, shall be due and payable in full on the earlier of: (i) March 8, 2028 (the “Maturity Date”) or (ii) an Event of Default (as defined below). Such payments shall be applied first to the payment of unpaid interest and second to reduce the outstanding Principal amount.

(c) Conditions to Closing. Upon satisfaction or waiver by the party sought to be benefited thereby of the conditions set forth in this Section 1(c), the Closing shall occur. At Closing:

(i)

the Note shall be duly executed by the Borrower and Holder;

(ii)

the Settlement Agreement shall be duly executed by the Borrower and Holder; and

(iii)

the Principal Amount shall be wired to Borrower’s designated bank account.

2. Voluntary Prepayment. The unpaid Principal Amount, together with interest accrued thereon, may be prepaid by the Company, in whole or in part, after the earlier of (i) 180 days from the issuance of this Note or (ii) the Effective Registration Date (as defined herein) upon thirty (30) days’ prior written notice without penalty.

3. Conversion. Holder shall have the right to convert, in whole or in part, the unpaid Principal Amount, together with accrued interest thereon, of this Note into shares of Borrower’s Common Stock upon the earlier of (i) 180 days from the issuance of this Note or (ii) the Effective Registration Date (as defined herein).

(a) Voluntary Conversion. At Holder’s option, Holder may convert, in whole or in part, the Principal Amount and accrued interest into a number of shares of Common Stock of the Company calculated by dividing (x) the Principal Amount and accrued interest to be converted under the Note, by (y) the then-applicable Conversion Price, as the case may be, subject to adjustment, in any.

(b) Mandatory Conversion. Provided that the Company completes a financing (the “Financing”) of its capital securities, or securities that may be converted into or exercise into capital securities, (i) of at least $8 million, not including the Principal Amount plus any accrued interest subject to the Mandatory Conversion, in an offering registered with the SEC; or (ii) of at least $2 million, not including the Principal Amount plus any accrued interest subject to the Mandatory Conversion, to non-affiliated purchaser(s) at an effective price of at least 150% of the Initial Note Conversion Price, Holder will be required to convert all, but not less than all (subject to the exchange limit set forth in paragraph 3(k) below), Principal Amount plus any accrued interest, into shares of Common Stock at the lower of the then-applicable Conversion Price and the effective price of such Financing; provided, however, that such mandatory conversion shall only be required if the Borrower if the Common Stock is then currently listed for trading on the NYSE or Nasdaq, and either (i) a resale shelf registration statement is in effect at the time of delivery of Common Stock permitting the Holder to sell all such shares of Common Stock to be received upon the Mandatory Conversion, (ii) the Holder thereof may sell all such shares under Rule 144 within a three-month period and such Holder, together with its affiliates, owns less than 1% of the outstanding shares of Common Stock, or (iii) in the case of a public offering, the Holder receives the same registered securities in the public offering in exchange for and in satisfaction of the unpaid Principal and accrued interest thereon.

(i)

For a Mandatory Conversion in connection with a registered public offering to be effective, the Borrower shall provide notice to Holder at least one (1) Business Day prior to the pricing date.

(ii)

For a Mandatory Conversion in connection with an offering with an effective price of at least 150% of the Initial Note Conversion Price, the Borrower shall provide notice of Mandatory Conversion not more than ten (10) Business Days after the closing of the offering, selecting a Mandatory Conversion Date not less than ten (10) Business Days and not more than twenty (20) Business Days after the date on which the Borrower provides the notice of Mandatory Conversion to the Holder. The notice shall state, as appropriate:

(1)

the Mandatory Conversion Date selected by the Borrower; and

(2)

the conversion rate in effect on the Mandatory Conversion Date, the amount of the outstanding principal amount and accrued interest on the Mandatory Conversion Date and the number of shares of Common Stock to be delivered to Holder.

(c) Effectiveness of Conversion. The Conversion shall be deemed to have been made immediately prior to the close of business on the Conversion Date, and the Holder shall be treated for all purposes as the record holder of the shares of Common Stock issued in the Conversion as of such date.

(d) Reservation of Shares. The Borrower shall at all times reserve and keep available out of its authorized and unissued Common Stock, solely for issuance upon the conversion of the Convertible Note, such number of shares of Common Stock as shall from time to time be issuable upon the conversion of all amounts outstanding under the Convertible Notes then outstanding. Any shares of Common Stock issued upon conversion of amounts outstanding under the Note shall be duly authorized, validly issued, fully paid and non-assessable.

(f) Mechanics of Conversion. As promptly as practicable after the conversion of this Note, this Note shall be cancelled, and the Borrower will issue and deliver to the Holder a certificate or certificates or evidence a book entry representing the full number of shares of Common Stock (and the issuance of such certificate or certificates shall be made without charge to the Holder for any issuance in respect thereof or other cost incurred by the Borrower in connection with such conversion and the related issuance of shares). No fractional shares of Common Stock or scrip representing a fraction of a shares of the Common Stock will be issued upon conversion, but the number of such shares issuable shall be rounded up to the nearest whole share.

(g) Adjustments. If the Borrower at any time subdivides (by any stock split, stock dividend, recapitalization or otherwise), its outstanding shares of Common Stock into a greater number of shares, the then applicable Conversion Price in effect immediately prior to such subdivision will be proportionately reduced, and if the Borrower at any time combines (by reverse stock split, recapitalization or otherwise) its outstanding shares of Common Stock into a smaller number of shares, the Conversion Price in effect immediately prior to such combination will be proportionately increased.

(h) Documentation. As a condition of effecting such conversion under this Section 3, Borrower shall execute and delivery all necessary documents, and the Company will take all necessary steps and seek all necessary approvals, including, but not limited to, approval by the NYSE American, to effect such conversion.

(i) Limitation on Beneficial Ownership. The Holder shall not have the right to convert any of the Note held by such Holder pursuant to the terms and conditions of this Note and any such conversion shall be null and void and treated as if never made, to the extent that after giving effect to such conversion, such Holder together with the other attribution parties collectively would beneficially own in excess of 9.99% (the “Maximum Percentage”) of the shares of Common Stock outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such Holder and the other attribution parties shall include the number of shares of Common Stock held by such Holder and all other attribution parties plus the number of shares of Common Stock issuable upon conversion of the Note with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock which would be issuable upon (A) conversion of the remaining, nonconverted Note beneficially owned by such Holder or any of the other attribution parties and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Borrower (including, without limitation, any convertible notes, convertible preferred stock or warrants) beneficially owned by such Holder or any other attribution party subject to a limitation on conversion or exercise analogous to the limitation contained in this Section. For purposes of this Section, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”). For purposes of determining the number of outstanding shares of Common Stock a Holder may acquire upon the conversion of the Note without exceeding the Maximum Percentage, such Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Borrower’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing with the SEC, as the case may be, (y) a more recent public announcement by the Borrower or (z) any other written notice by the Borrower or the transfer agent, if any, setting forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”). If the Borrower receives a Conversion Notice from a Holder at a time when the actual number of outstanding shares of Common Stock is less than the Reported Outstanding Share Number, the Borrower shall notify such Holder in writing of the number of shares of Common Stock then outstanding and, to the extent that such Conversion Notice would otherwise cause such Holder’s beneficial ownership, as determined pursuant to this Section, to exceed the Maximum Percentage, such Holder must notify the Borrower of a reduced number of shares of Common Stock to be purchased pursuant to such Conversion Notice. For any reason at any time, upon the written or oral request of any Holder, the Borrower shall within one (1) Business Day confirm orally and in writing or by electronic mail to such Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Borrower, including this Note, by such Holder and any other attribution party since the date as of which the Reported Outstanding Share Number was reported. In the event that the issuance of shares of Common Stock to a Holder upon conversion of this Note results in such Holder and the other attribution parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934 Act), the number of shares so issued by which such Holder’s and the other attribution parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and such Holder shall not have the power to vote or to transfer the Excess Shares. Upon delivery of a written notice to the Borrower, any Holder may from time to time increase (with such increase not effective until the sixty-first (61^st) day after delivery of such notice) or decrease the Maximum Percentage of such Holder to any other percentage not in excess of 19.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61^st) day after such notice is delivered to the Borrower and (ii) any such increase or decrease will apply only to such Holder and the other attribution parties and not to any other Holder that is not an attribution party of such Holder. For purposes of clarity, the shares of Common Stock issuable to a Holder pursuant to the terms of this Note in excess of the Maximum Percentage shall not be deemed to be beneficially owned by such Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to convert this Note pursuant to this Section shall have any effect on the applicability of the provisions of this Section with respect to any subsequent determination of convertibility. The provisions of this Section shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section to the extent necessary to correct this Section (or any portion thereof) which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in this Section may not be waived and shall apply to a successor holder of this Note.

(j) As used in this Note, the following capitalized terms have the following meaning.

“Common Stock” shall mean the voting common stock of the Borrower.

“Conversion Price” shall mean the “Initial Conversion Price” or the “Reset Conversion Price,” whichever is in effect at the time of conversion.

“Initial Note Conversion Price” shall equal 94.0% of the 10-day VWAP ending the business day preceding execution of this Note.

“Reset Note Conversion Price” shall equal 94.0% of 10-day VWAP ending on the thirtieth (30th) day after the Effective Registration Date.

“VWAP” shall mean, for any trading day, the daily volume weighted average price of the shares of Common Stock for such trading day on the NYSE American LLC (or such other market or exchange on which the shares of Common Stock are then listed or traded) during regular trading hours as reported by Bloomberg L.P.

(k) Compliance with Rules of Principal Market. Notwithstanding anything to the contrary herein, Holder shall not convert the Principal Amount and accrued interest under this Note (or any other note issued to Holder under the Settlement Agreement) if the aggregate number of shares of Common Stock that is converted under this Note (and any other note issued to Holder under the Settlement Agreement) would exceed 7,068,920 (representing 19.99% of the aggregate amount of Common Stock issued and outstanding as of the date of this Agreement, such maximum number of shares, the “Exchange Cap”); provided, however, that the Exchange Cap will not apply if the Company’s stockholders have approved the conversion into Common Stock in excess of the Exchange Cap in accordance with the rules of the NYSE American or the rules of the then stock exchange on which the Holder’s shares of Common Stock are listed. In connection with each conversion notice and subject to compliance with the rules of the NYSE American, any portion of a conversion that would exceed the Exchange Cap shall automatically be withdrawn with no further action required by the Holder and such conversion notice shall be deemed automatically modified to reduce the aggregate amount of the conversion requested so that such aggregate of conversion of shares of Common Stock by Holder will be less than the Exchange Cap.

(l) Failure to Deliver Common Stock Prior to Delivery Deadline. Without in any way limiting the Holder’s right to pursue other remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon conversion of this Note is not delivered within three (3) Business Days of any conversion (the “Deadline”), the Borrower shall pay to the Holder $2,000 per day in cash, for each day beyond the Deadline that the Borrower fails to deliver such Common Stock until the Borrower issues and delivers a certificate to the Holder or provides evidence of such delivery and book entry form to the Holder the number of shares of Common Stock to which the Holder is entitled upon such Holder’s conversion of any Conversion Amount (under Holder’s and Borrower’s expectation that any damages will tack back to the Issue Date). Such cash amount shall be paid to Holder by the fifth day of the month following the month in which it has accrued or, at the option of the Holder (by written notice to the Borrower by the first day of the month following the month in which it has accrued), shall be added to the principal amount of this Note, in which event interest shall accrue thereon in accordance with the terms of this Note and such additional principal amount shall be convertible into Common Stock in accordance with the terms of this Note. The Borrower agrees that the right to convert is a valuable right to the Holder. The damages resulting from a failure, attempt to frustrate, interference with such conversion right are difficult if not impossible to qualify. Accordingly the parties acknowledge that the liquidated damages provision contained herein are justified.

4. Events of Default. Upon the occurrence of any of the following events (“Event of Default”), the Borrower shall be in default hereunder.

(a) failure by the Borrower to pay when due any of the principal or accrued and unpaid interest hereunder; and such default shall have continued for a period of thirty days (30) days;

(b) the Borrower (i) applies for or consents to the appointment of a receiver, trustee, custodian or liquidator of itself or any part of its property, (ii) becomes subject to the appointment of a receiver, trustee, custodian or liquidator of itself or any part of its property if such appointment is not terminated or dismissed within sixty (60) days, (iii) makes an assignment for the benefit of creditors, (iv) is adjudicated as bankrupt or insolvent, (v) institutes any proceedings under the United States Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar law affecting the rights of creditors generally, or files a petition or answer seeking reorganization or an arrangement with creditors to take advantage of any insolvency law, or files an answer admitting the material allegations of a bankruptcy, reorganization or insolvency petition filed against it, or (vi) becomes subject to any proceedings under the United States Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar law affecting the rights of creditors generally, which proceeding is not dismissed within sixty (60) days of filing, or has an order for relief entered against it in any proceeding under the United States Bankruptcy Code.

If an Event of Default occurs, all indebtedness under this Note shall become immediately due and payable, and the Borrower shall immediately pay to Holder all amounts outstanding hereunder. Upon the occurrence of any Event of Default and at any time thereafter during the continuance of such Event of Default, Holder may, by written notice to the Borrower, declare all outstanding indebtedness payable by the Borrower hereunder to be immediately due and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein to the contrary notwithstanding. Upon the occurrence of any Event of Default, immediately and without notice, all outstanding indebtedness payable by the Borrower hereunder shall automatically become immediately due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein to the contrary notwithstanding. In addition to the foregoing remedies, upon the occurrence and during the continuance of any Event of Default, Holder may exercise any other right, power or remedy granted to it by this Note or otherwise permitted to it by law, either by suit in equity or by action at law, or both.

5. Registration Rights.

(a) Filing of a Registration Statement. Upon a written demand by Holder, Borrower shall prepare and file with the Securities and Exchange Commission (“SEC”) a Registration Statement for the resale by the Holder of the Common Stock issuable upon the conversion of the Note (and shares of Common Stock issuable upon the conversion of another note issued in connection with the Settlement Agreement) as soon as practicable after the effective date of the Settlement Agreement and Release of All Claims. Notwithstanding the foregoing, Borrower will have the right to delay the filing of such Registration Statement if the Borrower provides notice to Holder that it intends to effect a registered public offering of its securities by April 30, 2024. In the event that Borrower gives notice to Holder that it intends to conduct a registered public offering, Borrower shall have the right to delay the filing of a Registration Statement under this Section 5(a) until the lapse of any restrictive period prohibiting the filing of registration statements required under the public offering. The Borrower shall use its best efforts to have such Registration Statement declared effective by the SEC as soon as practicable. The effectiveness date of the Registration Statement under this Section 5(a) or (b) shall be deemed the Effective Registration Date; provided, however, that if the Effective Registration Date shall not have occurred prior to 180 days from the issuance of this Note, the Effective Registration Date as defined in this Note shall be deemed to occur on the 181^stday after the issuance of this Note.

(b) Piggyback Registration. If the Registration Statement provided for in subsection (a) above has not been filed and declared effective by the SEC, and if Borrower determines on or after ninety (90) days from the issuance of this Note to prepare and file with the SEC a registration statement or offering statement relating to an offering for its own account or the account of others under the Securities Act of 1933, as amended (“Securities Act”), of any of its equity securities (other than on Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with the Company’s stock option or other employee benefit plans), then the Borrower shall deliver to the Holder a written notice of such determination and, if within fifteen (15) days after the date of the delivery of such notice, such Holder shall so request in writing, the Borrower shall include in such registration statement or offering statement all Common Stock that may be issued in connection with the conversion of this Note such Holder requests to be registered; provided, however, the Company shall not be required to register any shares of Common Stock pursuant to this Section 5(b) that are eligible for resale pursuant to Rule 144 without restriction (including, without limitation, volume restrictions) and without the need for current public information required by Rule 144(c)(1) (or Rule 144(i)(2), if applicable) or that are the subject of a then-effective Registration Statement.

(c) Cutback. If an underwriter or placement agent that is to be engaged in an underwritten offering or best efforts offering advises the Borrower in good faith that the dollar amount or number of Common Stock which the Holder desires to sell under this Section 5(a) or (b), exceeds the maximum dollar amount or maximum number of shares that can be sold in such offering without adversely affecting the proposed offering price, the timing, the distribution method, or the probability of success of such offering, then the Company, and its underwriter or placement agent, will have to right to reduce the number of Common Stock requested to be registered by such Holder on a pro rata basis.

(d) Maintaining a Registration Statement. The Borrower shall maintain the effectiveness of any Registration Statement that has been declared effective at all times, provided, however, that if the Borrower has received notification pursuant to Section 3(e) above that the Holder has completed resales pursuant to the Registration Statement for all the shares of Common Stock, then the Borrower shall be under no further obligation to maintain the effectiveness of the Registration Statement. Notwithstanding anything to the contrary contained in this Note, the Borrower shall ensure that, when filed, each Registration Statement (including, without limitation, all amendments and supplements thereto) and the prospectus (including, without limitation, all amendments and supplements thereto) used in connection with such Registration Statement shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein (in the case of prospectuses, in the light of the circumstances in which they were made) not misleading. The Borrower shall notify the Holder promptly if (i) the Registration Statement shall cease to be effective under the Securities Act, (ii) the Common Stock shall cease to be authorized for listing on the NYSE American, (iii) the Common Stock ceases to be registered under Section 12(b) or Section 12(g) of the Exchange Act or (iv) the Borrower fails to file in a timely manner all reports and other documents required of it as a reporting company under the Exchange Act.

(e) Completion of Resale Pursuant to the Registration Statement. After the Holder has completed the subsequent resale of the shares of Common Stock pursuant to the Registration Statement, Holder will notify the Company in writing (which may be by e-mail) that all subsequent resales are completed and the Company will be under no further obligation to maintain the effectiveness of the Registration Statement.

(d) Filing Procedures. The Borrower shall (A) permit counsel to the Holder an opportunity to review and comment upon (i) each Registration Statement at least three (3) Trading Days prior to its filing with the SEC and (ii) all amendments and supplements to each Registration Statement (including, without limitation, the prospectus contained therein) (except for Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any similar or successor reports or prospectus supplements the contents of which is limited to that set forth in such reports) within a reasonable number of days prior to their filing with the SEC, and (B) shall reasonably consider any comments of the Holder and its counsel on any such Registration Statement or amendment or supplement thereto or to any prospectus contained therein. The Borrower shall promptly furnish to the Holder, without charge, (i) electronic copies of any correspondence from the SEC or the staff to the Borrower or its representatives relating to each Registration Statement (which correspondence shall be redacted to exclude any material, non-public information regarding the Company or any of its subsidiaries), (ii) after the same is prepared and filed with the SEC, one (1) electronic copy of each Registration Statement and any amendment(s) and supplement(s) thereto, including, without limitation, financial statements and schedules, all documents incorporated therein by reference, if requested by the Holder, and all exhibits and (iii) upon the effectiveness of each Registration Statement, one (1) electronic copy of the Prospectus included in such Registration Statement and all amendments and supplements thereto; provided, however, the Company shall not be required to furnish any document to the extent such document is available on EDGAR).

(e) Amendments and Other Filings. The Borrower shall (i) prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and the related prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may be necessary to keep such Registration Statement effective at all times, and prepare and file with the SEC such additional Registration Statements in order to register for resale under the Securities Act all of the Registrable Securities; (ii) cause the related prospectus to be amended or supplemented by any required prospectus supplement (subject to the terms of this Note), and as so supplemented or amended to be filed pursuant to Rule 424 promulgated under the Securities Act; (iii) provide the Holder copies of all correspondence from and to the SEC relating to a Registration Statement (provided that the Company may excise any information contained therein which would constitute material non-public information, and (iv) comply with the provisions of the Securities Act with respect to the Registration Statement. In the case of amendments and supplements to a Registration Statement which are required to be filed pursuant to this Agreement (including pursuant to this Section 6.01(e) by reason of the Borrower’s filing a report on Form 10-K, Form 10-Q, or Form 8-K or any analogous report under the Exchange Act, the Borrower shall file such report in a prospectus supplement filed pursuant to Rule 424 promulgated under the Securities Act to incorporate such filing into the Registration Statement, if applicable, or shall file such amendments or supplements with the SEC either on the day on which the Exchange Act report is filed which created the requirement for the Borrower to amend or supplement the Registration Statement, if feasible, or otherwise promptly thereafter.

6. Representations and Warranties of the Borrower. The Borrower represents and warrants to the Holder that:

(a)

Due Incorporation, Qualification. The Borrower (i) is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware; (ii) has the power and authority to own, lease and operate its properties and carry on its business as now conducted; and (iii) is duly qualified, licensed to do business and in good standing as a foreign corporation in each jurisdiction where the failure to be so qualified or licensed could reasonably be expected to have a material adverse effect on the Borrower.

(b)

Authority. The execution, delivery and performance by the Borrower of the Note and the consummation of the transactions contemplated thereby (i) are within the power of the Borrower and (ii) have been duly authorized by all necessary actions on the part of the Borrower.

(c)

Enforceability. Each Note executed, or to be executed, by the Borrower has been, or will be, duly executed and delivered by the Borrower and constitutes, or will constitute, a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity.

(d)

Non-Contravention. The execution and delivery by the Borrower of the Note executed by the Borrower and the performance and consummation of the transactions contemplated thereby do not and will not (i) violate the Charter or bylaws of the Borrower, or any material judgment, order, writ, decree, statute, rule or regulation applicable to the Borrower; or (ii) result in the creation or imposition of any lien upon any property, asset or revenue of the Borrower or the suspension, revocation, impairment, forfeiture, or nonrenewal of any material permit, license, authorization or approval applicable to the Borrower, its business or operations, or any of its assets or properties.

(e)

Approvals. No consent, approval, order or authorization of, or registration, declaration or filing with, any governmental authority or other person (including, without limitation, the shareholders of any person) is required in connection with the execution and delivery of the Note by the Borrower and the performance and consummation of the transactions contemplated thereby, other than such as have been obtained and remain in full force and effect and other than such qualifications or filings under applicable securities laws as may be required in connection with the transactions contemplated by this Note.

(f)

Shareholder Approval. In the event that the aggregate number of shares of Common Stock that are convertible under this Note (and any other note issued to Holder under the Settlement Agreement) would exceed the Exchange Cap, the Borrower shall cause a resolution seeking approval of the excess to be submitted for approval of the stockholders at the next annual or special meeting, and any subsequent meeting until such approval is obtained.

7. Representations and Warranties of Holder. Holder represents and warrants to the Borrower upon the acquisition of the Note as follows:

(a)

Binding Obligation. Holder has full legal capacity, power and authority to execute and deliver this Note and to perform its obligations hereunder. This Note constitutes valid and binding obligations of Holder, enforceable in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity.

(b)

Securities Law Compliance. Holder has been advised that the Note and the underlying securities have not been registered under the Act or any state securities laws and, therefore, cannot be resold unless it or they are registered under the Act and applicable state securities laws or unless an exemption from such registration requirements is available. Investor is aware that the Borrower is under no obligation to effect any such registration with respect to the Note or the underlying securities or to file for or comply with any exemption from registration. Holder has not been formed solely for the purpose of making this investment and is purchasing the Note for its own account for investment, not as a nominee or agent, and not with a view to, or for resale in connection with, the distribution thereof, and Holder has no present intention of selling, granting any participation in, or otherwise distributing the same. Holder has such knowledge and experience in financial and business matters that Holder is capable of evaluating the merits and risks of such investment, is able to incur a complete loss of such investment without impairing Holder’s financial condition and is able to bear the economic risk of such investment for an indefinite period of time. Investor is an “accredited investor” as such term is defined in Rule 501 of Regulation D under the Act and shall submit to the Borrower such further assurances of such status as may be reasonably requested by the Borrower. The residency of Holder (or, in the case of a partnership or corporation, such entity’s principal place of business) is correctly set forth beneath Holder’s name on the signature page hereto.

(c)

Access to Information. Holder acknowledges that the Borrwer has given Holder access to the corporate records and accounts of the Borrower and to all information in its possession relating to the Borrower, has made its officers and representatives available for interview by Holder, and has furnished Holder with all documents and other information required for Holder to make an informed decision with respect to the purchase of the Note.

8. Amendment and Waiver. Any provision of this Note may be amended, waived or modified only with the written consent of the Borrower and the Holder provided however, that no such amendment, waiver or consent shall: (i) reduce the principal amount of any Note without the Holder’s written consent, or (ii) reduce the rate of interest of any Note without the Holder’s written consent. Any term of this Note may be amended and the observance of any term of this Note may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Borrower and Holder. Any amendment or waiver effected in accordance with this paragraph shall be binding upon all of the parties hereto.

9. Assignment by the Borrower. The rights, interests or obligations of the Borrower hereunder may not be assigned, by operation of law or otherwise, in whole or in part, by the Borrower without the prior written consent of the Holder.

10. Place of Payment. Payments of principal and interest and all notices and other communications to Holder hereunder or with respect hereto are to be delivered to Holder such address as specified by Holder by prior written notice to the Borrower, including any transferee of this Note.

11. Costs of Collection. In the event that the Borrower fails to pay when due (including, without limitation upon acceleration in connection with an Event of Default) the full amount of principal and/or interest hereunder, the Borrower shall indemnify and hold harmless Holder of any portion of this Note from and against all costs and expenses incurred in connection with the enforcement of this provision or collection of such principal and interest, including, without limitation, attorneys’ fees and expenses.

12. Waivers. The Borrower hereby waives presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note.

13. Mutilated, Destroyed, Lost and Stolen Note. In case the Note shall be mutilated, lost, stolen or destroyed, the Borrower shall issue a new Note of like date, tenor and denomination and deliver the same in exchange and substitution for and upon surrender and cancellation of the mutilated Note, or in lieu of a lost, stolen or destroyed Note, upon receipt of evidence satisfactory to the Borrower of the loss, theft or destruction of such Note.

14. Interest Savings Clause. In the event any interest is paid on this Note which is deemed to be in excess of the then legal maximum rate, then that portion of the interest payment representing an amount in excess of the then legal maximum rate shall be deemed a payment of principal and applied against the principal of this Note.

15. Governing Law. THIS NOTE AND THE RIGHTS AND DUTIES OF THE BORROWER AND HOLDER HEREOF SHALL BE GOVERNED BY, CONSTRUED IN AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE TO CONTRACTS EXECUTED AND TO BE PERFORMED ENTIRELY WITHIN THAT STATE.

16. Waiver of Jury Trial. The Borrower hereby agrees to waive their respective rights to a jury trial of any claim or cause of action based upon or arising out of this Note.

17. Jurisdiction. In the event of a dispute, Borrower and Holder agree to the jurisdiction set forth in the Settlement Agreement.

18. Survival and Severability. The representations, warranties, covenants and agreements made herein shall survive the execution and delivery of this Note. If any term, covenant or provision contained in this Note, or the application thereof to any Person or circumstance, will be determined to be void, invalid, illegal or unenforceable to any extent or will otherwise operate to invalidate this Note, in whole or part, then such term, covenant or provision only will be deemed not contained in this Note; the remainder of this Note will remain operative and in full force and effect and will be enforced to the greatest extent permitted by law as if such clause or provision had never been contained in it; and the application of such term, covenant or provision to other Persons or circumstances will not be affected, impaired or restricted by that occurrence.

19. Entire Agreement. This Note and the Settlement Agreement constitute, along with any exhibits hereto and thereto, and contain the entire agreement among the Borrower and Holder and supersedes any and all prior agreements, negotiations, correspondence, understandings and communications among the parties, whether written or oral, respecting the subject matter hereof.

20. Notices. Any notice, request or other communication required or permitted hereunder will be in writing and be deemed to have been duly given (a) when personally delivered or sent by email(the receipt of which is confirmed in writing); (b) one business day after being sent by a nationally recognized overnight courier service; or (c) five business days after being sent by registered or certified mail, return receipt requested, postage prepaid, to the parties at their respective addresses set forth below:

If to the Borrower: Calidi Biotherapeutics, Inc.

4475 Executive Drive, Suite 200

San Diego, CA 92121

wpizarro@calidibio.com or contracts@calidibio.com

If to the Holder: [__________]

IN WITNESS WHEREOF, the Issuer has executed and delivered this Convertible Promissory Note on March 8, 2024

	ISSUER:

	Calidi Biotherapeutics, Inc.

	By:
	Name:	Allan Camaisa
	Title:	Chief Executive Officer

Acknowledged and Agreed:

HOLDER:

[__________]

By:
Name:
Title:

Exhibit 10.3

CALIDI BIOTHERAPEUTICS, INC.

CONVERTIBLE PROMISSORY NOTE

$1,500,000.00	San Diego, California
	March 8, 2024

FOR VALUE RECEIVED, Calidi Biotherapeutics, Inc., a Delaware corporation (“Issuer”), hereby unconditionally promises to pay to [__________], or its registered assigns (“Holder”), in lawful money of the United States of America in the principal amount of One Million Five Hundred Thousand Dollars ($1,500,000.00) (“Principal Amount”) pursuant to that certain Settlement Agreement and Release of All Claims dated March 8, 2024, by and among Issuer and Holder (the “Settlement Agreement”), together with interest thereon in accordance with the terms hereof, from the date hereof until the date on which this Convertible Promissory Note (the “Note”) is paid in full. “Closing” means the closing of the issuance of the Note pursuant to Section 1(c) and the terms and conditions hereunder.

1. Terms of Note.

(a) Interest Rate. Interest on the then outstanding Principal Amount of this Note shall accrue semiannually at a rate per annum equal to ten percent (10.0%), simple interest beginning on the date of this Note. All interest shall be calculated on the basis of the actual daily balances of Principal Amount outstanding for the exact number of days elapsed, using a year of three hundred sixty-five (365) days. All interest shall accrue and shall be payable on the Maturity Date in cash, or at the election of the Issuer, in-kind on the then outstanding amount of the Obligations by increasing the principal amount of the Obligations by the amount of such scheduled interest payment, or in-kind in Common Stock of the Issuer at the then-prevailing Note Conversion Price, provided the Issuer’s voting common stock is traded on an established public trading market.

(c) Conditions to Closing. Upon satisfaction or waiver by the party sought to be benefited thereby of the conditions set forth in this Section 1(c), the Closing shall occur. At Closing:

(i)

the Note shall be duly executed by the Issuer and Holder;

(ii)

the Settlement Agreement shall be duly executed by the Issuer and Holder; and

(iii)

the Principal Amount shall be wired to Issuer’s designated bank account.

3. Conversion. Holder shall have the right to convert, in whole or in part, the unpaid Principal Amount, together with accrued interest thereon, of this Note into shares of Issuer’s Common Stock upon the earlier of (i) 180 days from the issuance of this Note or (ii) the Effective Registration Date (as defined herein).

(b) Mandatory Conversion. Provided that the Company completes a financing (the “Financing”) of its capital securities, or securities that may be converted into or exercise into capital securities, (i) of at least $8 million, not including the Principal Amount plus any accrued interest subject to the Mandatory Conversion, in an offering registered with the SEC; or (ii) of at least $2 million, not including the Principal Amount plus any accrued interest subject to the Mandatory Conversion, to non-affiliated purchaser(s) at an effective price of at least 150% of the Initial Note Conversion Price, Holder will be required to convert all, but not less than all (subject to the exchange limit set forth in paragraph 3(k) below), Principal Amount plus any accrued interest, into shares of Common Stock at the lower of the then-applicable Conversion Price and the effective price of such Financing; provided, however, that such mandatory conversion shall only be required if the Issuer if the Common Stock is then currently listed for trading on the NYSE or Nasdaq, and either (i) a resale shelf registration statement is in effect at the time of delivery of Common Stock permitting the Holder to sell all such shares of Common Stock to be received upon the Mandatory Conversion, (ii) the Holder thereof may sell all such shares under Rule 144 within a three-month period and such Holder, together with its affiliates, owns less than 1% of the outstanding shares of Common Stock, or (iii) in the case of a public offering, the Holder receives the same registered securities in the public offering in exchange for and in satisfaction of the unpaid Principal and accrued interest thereon.

(i)

For a Mandatory Conversion in connection with a registered public offering to be effective, the Issuer shall provide notice to Holder at least one (1) Business Day prior to the pricing date.

(ii)

For a Mandatory Conversion in connection with an offering with an effective price of at least 150% of the Initial Note Conversion Price, the Issuer shall provide notice of Mandatory Conversion not more than ten (10) Business Days after the closing of the offering, selecting a Mandatory Conversion Date not less than ten (10) Business Days and not more than twenty (20) Business Days after the date on which the Issuer provides the notice of Mandatory Conversion to the Holder. The notice shall state, as appropriate:

	(1)	the Mandatory Conversion Date selected by the Issuer; and

	(2)	the conversion rate in effect on the Mandatory Conversion Date, the amount of the outstanding principal amount and accrued interest on the Mandatory Conversion Date and the number of shares of Common Stock to be delivered to Holder.

(d) Reservation of Shares. The Issuer shall at all times reserve and keep available out of its authorized and unissued Common Stock, solely for issuance upon the conversion of the Convertible Note, such number of shares of Common Stock as shall from time to time be issuable upon the conversion of all amounts outstanding under the Convertible Notes then outstanding. Any shares of Common Stock issued upon conversion of amounts outstanding under the Note shall be duly authorized, validly issued, fully paid and non-assessable.

(f) Mechanics of Conversion. As promptly as practicable after the conversion of this Note, this Note shall be cancelled, and the Issuer will issue and deliver to the Holder a certificate or certificates or evidence a book entry representing the full number of shares of Common Stock (and the issuance of such certificate or certificates shall be made without charge to the Holder for any issuance in respect thereof or other cost incurred by the Issuer in connection with such conversion and the related issuance of shares). No fractional shares of Common Stock or scrip representing a fraction of a shares of the Common Stock will be issued upon conversion, but the number of such shares issuable shall be rounded up to the nearest whole share.

(g) Adjustments. If the Issuer at any time subdivides (by any stock split, stock dividend, recapitalization or otherwise), its outstanding shares of Common Stock into a greater number of shares, the then applicable Conversion Price in effect immediately prior to such subdivision will be proportionately reduced, and if the Issuer at any time combines (by reverse stock split, recapitalization or otherwise) its outstanding shares of Common Stock into a smaller number of shares, the Conversion Price in effect immediately prior to such combination will be proportionately increased.

(h) Documentation. As a condition of effecting such conversion under this Section 3, Issuer shall execute and delivery all necessary documents, and the Company will take all necessary steps and seek all necessary approvals, including, but not limited to, approval by the NYSE American, to effect such conversion.

(i) Limitation on Beneficial Ownership. The Holder shall not have the right to convert any of the Note held by such Holder pursuant to the terms and conditions of this Note and any such conversion shall be null and void and treated as if never made, to the extent that after giving effect to such conversion, such Holder together with the other attribution parties collectively would beneficially own in excess of 9.99% (the “Maximum Percentage”) of the shares of Common Stock outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such Holder and the other attribution parties shall include the number of shares of Common Stock held by such Holder and all other attribution parties plus the number of shares of Common Stock issuable upon conversion of the Note with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock which would be issuable upon (A) conversion of the remaining, nonconverted Note beneficially owned by such Holder or any of the other attribution parties and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Issuer (including, without limitation, any convertible notes, convertible preferred stock or warrants) beneficially owned by such Holder or any other attribution party subject to a limitation on conversion or exercise analogous to the limitation contained in this Section. For purposes of this Section, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”). For purposes of determining the number of outstanding shares of Common Stock a Holder may acquire upon the conversion of the Note without exceeding the Maximum Percentage, such Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Issuer’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing with the SEC, as the case may be, (y) a more recent public announcement by the Issuer or (z) any other written notice by the Issuer or the transfer agent, if any, setting forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”). If the Issuer receives a Conversion Notice from a Holder at a time when the actual number of outstanding shares of Common Stock is less than the Reported Outstanding Share Number, the Issuer shall notify such Holder in writing of the number of shares of Common Stock then outstanding and, to the extent that such Conversion Notice would otherwise cause such Holder’s beneficial ownership, as determined pursuant to this Section, to exceed the Maximum Percentage, such Holder must notify the Issuer of a reduced number of shares of Common Stock to be purchased pursuant to such Conversion Notice. For any reason at any time, upon the written or oral request of any Holder, the Issuer shall within one (1) Business Day confirm orally and in writing or by electronic mail to such Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Issuer, including this Note, by such Holder and any other attribution party since the date as of which the Reported Outstanding Share Number was reported. In the event that the issuance of shares of Common Stock to a Holder upon conversion of this Note results in such Holder and the other attribution parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934 Act), the number of shares so issued by which such Holder’s and the other attribution parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and such Holder shall not have the power to vote or to transfer the Excess Shares. Upon delivery of a written notice to the Issuer, any Holder may from time to time increase (with such increase not effective until the sixty-first (61^st) day after delivery of such notice) or decrease the Maximum Percentage of such Holder to any other percentage not in excess of 19.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61^st) day after such notice is delivered to the Issuer and (ii) any such increase or decrease will apply only to such Holder and the other attribution parties and not to any other Holder that is not an attribution party of such Holder. For purposes of clarity, the shares of Common Stock issuable to a Holder pursuant to the terms of this Note in excess of the Maximum Percentage shall not be deemed to be beneficially owned by such Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to convert this Note pursuant to this Section shall have any effect on the applicability of the provisions of this Section with respect to any subsequent determination of convertibility. The provisions of this Section shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section to the extent necessary to correct this Section (or any portion thereof) which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in this Section may not be waived and shall apply to a successor holder of this Note.

(j) As used in this Note, the following capitalized terms have the following meaning.

“Common Stock” shall mean the voting common stock of the Issuer.

“Conversion Price” shall mean the “Initial Conversion Price” or the “Reset Conversion Price,” whichever is in effect at the time of conversion.

“Initial Note Conversion Price” shall equal 94.0% of the 10-day VWAP ending the business day preceding execution of this Note.

“Reset Note Conversion Price” shall equal 94.0% of 10-day VWAP ending on the thirtieth (30th) day after the Effective Registration Date.

(l) Failure to Deliver Common Stock Prior to Delivery Deadline. Without in any way limiting the Holder’s right to pursue other remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon conversion of this Note is not delivered within three (3) Business Days of any conversion (the “Deadline”), the Issuer shall pay to the Holder $2,000 per day in cash, for each day beyond the Deadline that the Issuer fails to deliver such Common Stock until the Issuer issues and delivers a certificate to the Holder or provides evidence of such delivery and book entry form to the Holder the number of shares of Common Stock to which the Holder is entitled upon such Holder’s conversion of any Conversion Amount (under Holder’s and Issuer’s expectation that any damages will tack back to the Issue Date). Such cash amount shall be paid to Holder by the fifth day of the month following the month in which it has accrued or, at the option of the Holder (by written notice to the Issuer by the first day of the month following the month in which it has accrued), shall be added to the principal amount of this Note, in which event interest shall accrue thereon in accordance with the terms of this Note and such additional principal amount shall be convertible into Common Stock in accordance with the terms of this Note. The Issuer agrees that the right to convert is a valuable right to the Holder. The damages resulting from a failure, attempt to frustrate, interference with such conversion right are difficult if not impossible to qualify. Accordingly the parties acknowledge that the liquidated damages provision contained herein are justified.

4. Events of Default. Upon the occurrence of any of the following events (“Event of Default”), the Issuer shall be in default hereunder.

(a) failure by the Issuer to pay when due any of the principal or accrued and unpaid interest hereunder; and such default shall have continued for a period of thirty days (30) days;

(b) the Issuer (i) applies for or consents to the appointment of a receiver, trustee, custodian or liquidator of itself or any part of its property, (ii) becomes subject to the appointment of a receiver, trustee, custodian or liquidator of itself or any part of its property if such appointment is not terminated or dismissed within sixty (60) days, (iii) makes an assignment for the benefit of creditors, (iv) is adjudicated as bankrupt or insolvent, (v) institutes any proceedings under the United States Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar law affecting the rights of creditors generally, or files a petition or answer seeking reorganization or an arrangement with creditors to take advantage of any insolvency law, or files an answer admitting the material allegations of a bankruptcy, reorganization or insolvency petition filed against it, or (vi) becomes subject to any proceedings under the United States Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar law affecting the rights of creditors generally, which proceeding is not dismissed within sixty (60) days of filing, or has an order for relief entered against it in any proceeding under the United States Bankruptcy Code.

If an Event of Default occurs, all indebtedness under this Note shall become immediately due and payable, and the Issuer shall immediately pay to Holder all amounts outstanding hereunder. Upon the occurrence of any Event of Default and at any time thereafter during the continuance of such Event of Default, Holder may, by written notice to the Issuer, declare all outstanding indebtedness payable by the Issuer hereunder to be immediately due and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein to the contrary notwithstanding. Upon the occurrence of any Event of Default, immediately and without notice, all outstanding indebtedness payable by the Issuer hereunder shall automatically become immediately due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein to the contrary notwithstanding. In addition to the foregoing remedies, upon the occurrence and during the continuance of any Event of Default, Holder may exercise any other right, power or remedy granted to it by this Note or otherwise permitted to it by law, either by suit in equity or by action at law, or both.

5. Registration Rights.

(a) Filing of a Registration Statement. Upon a written demand by Holder, Issuer shall prepare and file with the Securities and Exchange Commission (“SEC”) a Registration Statement for the resale by the Holder of the Common Stock issuable upon the conversion of the Note (and shares of Common Stock issuable upon the conversion of another note issued in connection with the Settlement Agreement) as soon as practicable after the effective date of the Settlement Agreement and Release of All Claims. Notwithstanding the foregoing, Issuer will have the right to delay the filing of such Registration Statement if the Issuer provides notice to Holder that it intends to effect a registered public offering of its securities by April 30, 2024. In the event that Issuer gives notice to Holder that it intends to conduct a registered public offering, Issuer shall have the right to delay the filing of a Registration Statement under this Section 5(a) until the lapse of any restrictive period prohibiting the filing of registration statements required under the public offering. The Issuer shall use its best efforts to have such Registration Statement declared effective by the SEC as soon as practicable. The effectiveness date of the Registration Statement under this Section 5(a) or (b) shall be deemed the Effective Registration Date; provided, however, that if the Effective Registration Date shall not have occurred prior to 180 days from the issuance of this Note, the Effective Registration Date as defined in this Note shall be deemed to occur on the 181^st day after the issuance of this Note.

(b) Piggyback Registration. If the Registration Statement provided for in subsection (a) above has not been filed and declared effective by the SEC, and if Issuer determines on or after ninety (90) days from the issuance of this Note to prepare and file with the SEC a registration statement or offering statement relating to an offering for its own account or the account of others under the Securities Act of 1933, as amended (“Securities Act”), of any of its equity securities (other than on Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with the Company’s stock option or other employee benefit plans), then the Issuer shall deliver to the Holder a written notice of such determination and, if within fifteen (15) days after the date of the delivery of such notice, such Holder shall so request in writing, the Issuer shall include in such registration statement or offering statement all Common Stock that may be issued in connection with the conversion of this Note such Holder requests to be registered; provided, however, the Company shall not be required to register any shares of Common Stock pursuant to this Section 5(b) that are eligible for resale pursuant to Rule 144 without restriction (including, without limitation, volume restrictions) and without the need for current public information required by Rule 144(c)(1) (or Rule 144(i)(2), if applicable) or that are the subject of a then-effective Registration Statement.

(c) Cutback. If an underwriter or placement agent that is to be engaged in an underwritten offering or best efforts offering advises the Issuer in good faith that the dollar amount or number of Common Stock which the Holder desires to sell under this Section 5(a) or (b), exceeds the maximum dollar amount or maximum number of shares that can be sold in such offering without adversely affecting the proposed offering price, the timing, the distribution method, or the probability of success of such offering, then the Company, and its underwriter or placement agent, will have to right to reduce the number of Common Stock requested to be registered by such Holder on a pro rata basis.

(d) Maintaining a Registration Statement. The Issuer shall maintain the effectiveness of any Registration Statement that has been declared effective at all times, provided, however, that if the Issuer has received notification pursuant to Section 3(e) above that the Holder has completed resales pursuant to the Registration Statement for all the shares of Common Stock, then the Issuer shall be under no further obligation to maintain the effectiveness of the Registration Statement. Notwithstanding anything to the contrary contained in this Note, the Issuer shall ensure that, when filed, each Registration Statement (including, without limitation, all amendments and supplements thereto) and the prospectus (including, without limitation, all amendments and supplements thereto) used in connection with such Registration Statement shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein (in the case of prospectuses, in the light of the circumstances in which they were made) not misleading. The Issuer shall notify the Holder promptly if (i) the Registration Statement shall cease to be effective under the Securities Act, (ii) the Common Stock shall cease to be authorized for listing on the NYSE American, (iii) the Common Stock ceases to be registered under Section 12(b) or Section 12(g) of the Exchange Act or (iv) the Issuer fails to file in a timely manner all reports and other documents required of it as a reporting company under the Exchange Act.

(d) Filing Procedures. The Issuer shall (A) permit counsel to the Holder an opportunity to review and comment upon (i) each Registration Statement at least three (3) Trading Days prior to its filing with the SEC and (ii) all amendments and supplements to each Registration Statement (including, without limitation, the prospectus contained therein) (except for Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any similar or successor reports or prospectus supplements the contents of which is limited to that set forth in such reports) within a reasonable number of days prior to their filing with the SEC, and (B) shall reasonably consider any comments of the Holder and its counsel on any such Registration Statement or amendment or supplement thereto or to any prospectus contained therein. The Issuer shall promptly furnish to the Holder, without charge, (i) electronic copies of any correspondence from the SEC or the staff to the Issuer or its representatives relating to each Registration Statement (which correspondence shall be redacted to exclude any material, non-public information regarding the Company or any of its subsidiaries), (ii) after the same is prepared and filed with the SEC, one (1) electronic copy of each Registration Statement and any amendment(s) and supplement(s) thereto, including, without limitation, financial statements and schedules, all documents incorporated therein by reference, if requested by the Holder, and all exhibits and (iii) upon the effectiveness of each Registration Statement, one (1) electronic copy of the Prospectus included in such Registration Statement and all amendments and supplements thereto; provided, however, the Company shall not be required to furnish any document to the extent such document is available on EDGAR).

(e) Amendments and Other Filings. The Issuer shall (i) prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and the related prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may be necessary to keep such Registration Statement effective at all times, and prepare and file with the SEC such additional Registration Statements in order to register for resale under the Securities Act all of the Registrable Securities; (ii) cause the related prospectus to be amended or supplemented by any required prospectus supplement (subject to the terms of this Note), and as so supplemented or amended to be filed pursuant to Rule 424 promulgated under the Securities Act; (iii) provide the Holder copies of all correspondence from and to the SEC relating to a Registration Statement (provided that the Company may excise any information contained therein which would constitute material non-public information, and (iv) comply with the provisions of the Securities Act with respect to the Registration Statement. In the case of amendments and supplements to a Registration Statement which are required to be filed pursuant to this Agreement (including pursuant to this Section 6.01(e) by reason of the Issuer’s filing a report on Form 10-K, Form 10-Q, or Form 8-K or any analogous report under the Exchange Act, the Issuer shall file such report in a prospectus supplement filed pursuant to Rule 424 promulgated under the Securities Act to incorporate such filing into the Registration Statement, if applicable, or shall file such amendments or supplements with the SEC either on the day on which the Exchange Act report is filed which created the requirement for the Issuer to amend or supplement the Registration Statement, if feasible, or otherwise promptly thereafter.

6. Representations and Warranties of the Issuer. The Issuer represents and warrants to the Holder that:

(a)

Due Incorporation, Qualification. The Issuer (i) is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware; (ii) has the power and authority to own, lease and operate its properties and carry on its business as now conducted; and (iii) is duly qualified, licensed to do business and in good standing as a foreign corporation in each jurisdiction where the failure to be so qualified or licensed could reasonably be expected to have a material adverse effect on the Issuer.

(b)

Authority. The execution, delivery and performance by the Issuer of the Note and the consummation of the transactions contemplated thereby (i) are within the power of the Issuer and (ii) have been duly authorized by all necessary actions on the part of the Issuer.

(c)

Enforceability. Each Note executed, or to be executed, by the Issuer has been, or will be, duly executed and delivered by the Issuer and constitutes, or will constitute, a legal, valid and binding obligation of the Issuer, enforceable against the Issuer in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity.

(d)

Non-Contravention. The execution and delivery by the Issuer of the Note executed by the Issuer and the performance and consummation of the transactions contemplated thereby do not and will not (i) violate the Charter or bylaws of the Issuer, or any material judgment, order, writ, decree, statute, rule or regulation applicable to the Issuer; or (ii) result in the creation or imposition of any lien upon any property, asset or revenue of the Issuer or the suspension, revocation, impairment, forfeiture, or nonrenewal of any material permit, license, authorization or approval applicable to the Issuer, its business or operations, or any of its assets or properties.

(e)

Approvals. No consent, approval, order or authorization of, or registration, declaration or filing with, any governmental authority or other person (including, without limitation, the shareholders of any person) is required in connection with the execution and delivery of the Note by the Issuer and the performance and consummation of the transactions contemplated thereby, other than such as have been obtained and remain in full force and effect and other than such qualifications or filings under applicable securities laws as may be required in connection with the transactions contemplated by this Note.

(f)

Shareholder Approval. In the event that the aggregate number of shares of Common Stock that are convertible under this Note (and any other note issued to Holder under the Settlement Agreement) would exceed the Exchange Cap, the Issuer shall cause a resolution seeking approval of the excess to be submitted for approval of the stockholders at the next annual or special meeting, and any subsequent meeting until such approval is obtained.

7. Representations and Warranties of Holder. Holder represents and warrants to the Issuer upon the acquisition of the Note as follows:

	(a)	Binding Obligation. Holder has full legal capacity, power and authority to execute and deliver this Note and to perform its obligations hereunder. This Note constitutes valid and binding obligations of Holder, enforceable in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity.

	(b)	Securities Law Compliance. Holder has been advised that the Note and the underlying securities have not been registered under the Act or any state securities laws and, therefore, cannot be resold unless it or they are registered under the Act and applicable state securities laws or unless an exemption from such registration requirements is available. Investor is aware that the Issuer is under no obligation to effect any such registration with respect to the Note or the underlying securities or to file for or comply with any exemption from registration. Holder has not been formed solely for the purpose of making this investment and is purchasing the Note for its own account for investment, not as a nominee or agent, and not with a view to, or for resale in connection with, the distribution thereof, and Holder has no present intention of selling, granting any participation in, or otherwise distributing the same. Holder has such knowledge and experience in financial and business matters that Holder is capable of evaluating the merits and risks of such investment, is able to incur a complete loss of such investment without impairing Holder’s financial condition and is able to bear the economic risk of such investment for an indefinite period of time. Investor is an “accredited investor” as such term is defined in Rule 501 of Regulation D under the Act and shall submit to the Issuer such further assurances of such status as may be reasonably requested by the Issuer. The residency of Holder (or, in the case of a partnership or corporation, such entity’s principal place of business) is correctly set forth beneath Holder’s name on the signature page hereto.

	(c)	Access to Information. Holder acknowledges that the Borrwer has given Holder access to the corporate records and accounts of the Issuer and to all information in its possession relating to the Issuer, has made its officers and representatives available for interview by Holder, and has furnished Holder with all documents and other information required for Holder to make an informed decision with respect to the purchase of the Note.

8. Amendment and Waiver. Any provision of this Note may be amended, waived or modified only with the written consent of the Issuer and the Holder provided however, that no such amendment, waiver or consent shall: (i) reduce the principal amount of any Note without the Holder’s written consent, or (ii) reduce the rate of interest of any Note without the Holder’s written consent. Any term of this Note may be amended and the observance of any term of this Note may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Issuer and Holder. Any amendment or waiver effected in accordance with this paragraph shall be binding upon all of the parties hereto.

9. Assignment by the Issuer. The rights, interests or obligations of the Issuer hereunder may not be assigned, by operation of law or otherwise, in whole or in part, by the Issuer without the prior written consent of the Holder.

11. Costs of Collection. In the event that the Issuer fails to pay when due (including, without limitation upon acceleration in connection with an Event of Default) the full amount of principal and/or interest hereunder, the Issuer shall indemnify and hold harmless Holder of any portion of this Note from and against all costs and expenses incurred in connection with the enforcement of this provision or collection of such principal and interest, including, without limitation, attorneys’ fees and expenses.

12. Waivers. The Issuer hereby waives presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note.

13. Mutilated, Destroyed, Lost and Stolen Note. In case the Note shall be mutilated, lost, stolen or destroyed, the Issuer shall issue a new Note of like date, tenor and denomination and deliver the same in exchange and substitution for and upon surrender and cancellation of the mutilated Note, or in lieu of a lost, stolen or destroyed Note, upon receipt of evidence satisfactory to the Issuer of the loss, theft or destruction of such Note.

15. Governing Law. THIS NOTE AND THE RIGHTS AND DUTIES OF THE ISSUER AND HOLDER HEREOF SHALL BE GOVERNED BY, CONSTRUED IN AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE TO CONTRACTS EXECUTED AND TO BE PERFORMED ENTIRELY WITHIN THAT STATE.

16. Waiver of Jury Trial. The Issuer hereby agrees to waive their respective rights to a jury trial of any claim or cause of action based upon or arising out of this Note.

17. Jurisdiction. In the event of a dispute, Issuer and Holder agree to the jurisdiction set forth in the Settlement Agreement.

19. Entire Agreement. This Note and the Settlement Agreement constitute, along with any exhibits hereto and thereto, and contain the entire agreement among the Issuer and Holder and supersedes any and all prior agreements, negotiations, correspondence, understandings and communications among the parties, whether written or oral, respecting the subject matter hereof.

20. Notices. Any notice, request or other communication required or permitted hereunder will be in writing and be deemed to have been duly given (a) when personally delivered or sent by email (the receipt of which is confirmed in writing); (b) one business day after being sent by a nationally recognized overnight courier service; or (c) five business days after being sent by registered or certified mail, return receipt requested, postage prepaid, to the parties at their respective addresses set forth below:

If to the Issuer: Calidi Biotherapeutics, Inc.

Attn: Wendy Pizarro, Esq.

4475 Executive Drive, Suite 200

San Diego, CA 92121

wpizarro@calidibio.com or contracts@calidibio.com

If to the Holder: [__________]

[Remainder of this page is intentionally blank]

IN WITNESS WHEREOF, the Issuer has executed and delivered this Convertible Promissory Note on March 8, 2024

	ISSUER:

	Calidi Biotherapeutics, Inc.

	By:
	Name:	Allan Camaisa
	Title:	Chief Executive Officer

Acknowledged and Agreed:

HOLDER:

[__________]

By:
Name:
Title:

Exhibit 10.4

AMENDMENT TO CONVERTIBLE NOTE

This Amendment to the CONVERTIBLE NOTE in the principal amount of $1,500,000.00 (“Amendment”) is entered with an effective date of March 11, 2024, by and between Calidi Biotherapeutics Inc., (the “Issuer”), and [_________] (the “Holder”), collectively the “Parties” and each a “Party”.

WHEREAS, the Issuer and Holder entered into the Convertible Note in the principal amount of $1,500,000.00 dated March 8, 2024 (the “Convertible Note”), attached hereto as Exhibit A.

WHEREAS, the Issuer and Holder desire to amend the terms of the Convertible Note as set forth below.

NOW THEREFORE, in exchange for the mutual covenants set forth below, and other valuable consideration, the Parties agree to amend the Agreement as follows:

The following provision shall be deleted in its entirety in Section 1.(c): (iii) the Principal Amount shall be wired to Issuer’s bank account.

The terms of this Amendment shall be incorporated by reference into the Convertible Note. Besides the terms as forth herein, all of the terms, conditions, and obligations of the Convertible Note shall remain in full force and effect.

IN WITNESS WHEREOF, the Issuer and the Holder have caused this Convertible Note to be duly executed as of the date first written above.

	ISSUER:
	CALIDI BIOTHERAPEUTICS, INC.

	By:
	Name:	Wendy Pizarro, Esq.
	Title:	Chief Legal Officer

HOLDER:

[_________________]

By:
Name:
Title:

Cover	Mar. 08, 2024
Document Type	8-K
Amendment Flag	false
Document Period End Date	Mar. 08, 2024
Entity File Number	001-40789
Entity Registrant Name	Calidi Biotherapeutics, Inc.
Entity Central Index Key	0001855485
Entity Tax Identification Number	86-2967193
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	4475 Executive Dr.
Entity Address, Address Line Two	Suite 200
Entity Address, City or Town	San Diego
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92121
City Area Code	(858)
Local Phone Number	794-9600
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false
Common Stock Par Value 0. 0001 Per Share [Member]
Title of 12(b) Security	Common stock, par value $0.0001 per share
Trading Symbol	CLDI
Security Exchange Name	NYSEAMER
Redeemable Warrants Each Whole Warrant Exercisable For One Share Of Common Stock At Exercise Price Of 11. 50 Per Share [Member]
Title of 12(b) Security	Redeemable warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50 per share
Trading Symbol	CLDIWS
Security Exchange Name	NYSEAMER

- Details

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