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): January 4, 2021

 

Pareteum Corporation

(Exact name of Registrant as Specified in Charter)

 

Delaware   001-35360   95-4557538
(State or Other Jurisdiction of
Incorporation) 		  (Commission File Number)   (IRS. Employer Identification No.)

 

1185 Avenue of the Americas, 2nd Floor

New York, NY 10036

(Address of principal executive offices) (Zip Code)

 

(646) 975-0400

(Registrant's telephone number, including area code)

 

Securities registered or to be registered pursuant to Section 12(b) of the Act:

 

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock TEUM NASDAQ

 

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:

 

¨ 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))

 

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 January 4, 2021, Pareteum Corporation (the “Company”) entered into a letter agreement (the “Letter Agreement”) with High Trail Investments SA LLC (“HT”), the holder of that certain Senior Secured Convertible Note due 2025 (the “Note”) issued by the Company on June 8, 2020. Under the terms of the Letter Agreement, HT and the Company agreed that HT would accept 583,334 shares of the Company’s common stock (the “Interest Shares”) in full satisfaction of the Company’s obligation to make a payment of $262,500 in interest on January 1, 2021 under the Note.

 

The foregoing description is qualified in its entirety by the terms of the Letter Agreement, which is incorporated herein by reference and attached hereto as Exhibit 10.1.

 

Item 3.02. Unregistered Sales of Equity Securities.

 

The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.  The offer and sale of the Interest Shares was made pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), provided by Section 4(a)(2) of the Securities Act. The Company has relied on this exemption from registration based in part on representations made by HT in the SPA that it is an “accredited investor” as defined in Rule 501 under the Securities Act and HT’s understanding that the Interest Shares are being acquired for investment purposes and not with a view to or for sale in connection with any distribution thereof in violation of any federal or state securities laws.

 

Item 9.01. Financial Statements and Exhibits.

 

(d)       Exhibits

 

Exhibit Number   Description
10.1   Letter agreement, dated as of January 4, 2021, between Pareteum Corporation and High Trail Investments SA LLC

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  PARETEUM CORPORATION
   
   
Dated: January 6, 2021 By: /s/ Laura W. Thomas
    Name: Laura W. Thomas
    Title: Interim Chief Financial Officer

 

 

 

Exhibit 10.1

 

 

 

1185 Avenue of the Americas, 2nd Floor, New York, NY 10036

 

January 4, 2021

 

High Trail Investments SA LLC

221 River Street, 9th Floor

Hoboken, NJ 07030

Attention: Eric Helenek

 

Re:        Pareteum Corporation Financing

 

Ladies and Gentlemen:

 

This letter agreement pertains to that certain Senior Secured Convertible Note due 2025, dated as of June 8, 2020 (as amended by that certain Amendment to Senior Secured Convertible Note Due 2025, dated as of July 18, 2020, and as further amended by that certain Forbearance Agreement, dated as of November 30, 2020 (the “Forbearance Agreement”), the “Note”), made by Pareteum Corporation, a Delaware corporation (the “Company”), to High Trail Investments SA LLC (“HT”). All capitalized terms used in this letter agreement, but not defined herein, have the meanings ascribed to such terms in the Forbearance Agreement or, if not defined therein, the Note.

 

HT and the Company hereby agree as follows:

 

1.            Shares in Lieu of January 1, 2021 Cash Interest Payment. HT hereby agrees to accept, in full satisfaction of the Company’s obligation to make the payment of Stated Interest on the January 1, 2021 Interest Payment Date, 583,334 shares of Common Stock (the “Shares in Lieu of Interest Payment”). The Company shall cause its transfer agent to credit such shares to HT’s account with The Depositary Trust Company on the date hereof.

 

2.            Securities Purchase Agreement. The parties hereby agree that for purposes of Sections 5(d) and 5(e) of the Securities Purchase Agreement, the Shares in Lieu of Interest Payment shall constitute “Securities” and HT shall constitute a “Buyer” as such terms are used therein.

 

3.            Material Non-Public Information. On or before 9:00 a.m., New York time, on the trading day after the date of this letter agreement, the Company shall file a Current Report on Form 8-K describing all the material terms of the transactions contemplated by this letter agreement in the form required by the Exchange Act. From and after the filing of the such Form 8-K, the Company shall have disclosed all material, non-public information (if any) provided to HT by the Company or any of its subsidiaries or any of their respective officers, directors, employees or agents. In addition, effective upon the issuance of such Form 8-K, the Company acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its subsidiaries or any of their respective officers, directors, affiliates, employees or agents, on the one hand, and HT or any of its affiliates, on the other hand, shall terminate. The Company shall not, and the Company shall cause each of its subsidiaries and each of its and their respective officers, directors, employees and agents not to, provide HT with any material, non-public information regarding the Company or any of its subsidiaries from and after the date hereof unless prior thereto HT shall have consented in writing to the receipt of such information and agreed with the Company to keep such information confidential.

 

 

 

 

High Trail Investments SA LLC

January 4, 2021

Page 2 of 3

 

4.            Limited Nature of Agreement. The agreement set forth in this letter agreement is limited to the extent specifically set forth above and shall in no way serve to amend or waive compliance with any terms, covenants or provisions of the Note, other than as expressly set forth above.

 

5.            Acknowledgements. To induce HT to enter into this letter agreement, the Company hereby acknowledges, stipulates, warrants and agrees as follows:

 

(a)            upon giving effect to this letter agreement, other than as disclosed in the Forbearance Agreement, no default or Event of Default currently exists or is continuing as of the date hereof and none is currently expected; and

 

(b)            the execution of this letter agreement does not constitute an agreement by HT that there are no events of default existing under the Note, the March Warrant, the June Warrant or the Securities Purchase Agreement, and HT has reserved all rights and remedies with respect to any other such defaults or events of default, subject to the Forbearance Agreement.

 

6.            Miscellaneous. The Note, the March Warrant, the June Warrant and the Securities Purchase Agreement remain in full force and effect in accordance with their terms. Nothing in this letter agreement, any other correspondence, or any oral communications between the Company and HT should be construed to be a waiver, limitation, or forgiveness of any default or any of HT’s default rights and remedies under any of the Note, the March Warrant, the June Warrant and the Securities Purchase Agreement, any other agreement, instrument or document between the Company and HT, and as provided by applicable law, all of which rights and remedies remain in full force and effect.

 

The terms and provisions of the Note, the March Warrant, the June Warrant and the Securities Purchase Agreement are ratified and confirmed and remain in full force and effect. Any breach of the terms and conditions of this letter agreement will constitute an event of default under the Note, the March Warrant, the June Warrant and the Securities Purchase Agreement, as applicable.

 

If the foregoing correctly sets forth the understanding between the Company and HT, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between the Company and HT.

 

[Remainder of Page Left Blank; Signature Page Follows]

 

 

 

 

High Trail Investments SA LLC

January 4, 2021

Page 3 of 3

 

This letter agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all of which counterparts together shall constitute but one and the same instrument.

 

  Very truly yours,
     
  PARETEUM CORPORATION
     
  By: /s/ Alexander Korff
  Name: Alexander Korff
  Title: Corporate Secretary

 

AGREED AND ACCEPTED:

 

HIGH TRAIL INVESTMENTS SA LLC  
     
By: /s/ Eric Helenek  
Name: Eric Helenek  
Title: Authorized Signatory