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): July 2, 2009 (June 29, 2009)

ELEPHANT TALK COMMUNICATIONS INC.
(Exact name of registrant as specified in Charter)

California
 
000-30061
 
95-4557538                  
(State of other Jurisdiction of
incorporation)
 
(Commission file no.)
 
(IRS employer identification no.)
 
 
 
Schiphol Boulevard 249, 1118 BH Luchthaven Schiphol, The Netherlands
(Address of Principal Executive Offices)                                                          (Zip Code)

Registrant's telephone number, including area code (31 0 20 653 5916)

 
N/A
(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:

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

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

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

o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 
Forward Looking Statements
 
         This Form 8-K and other reports we file from time to time with the Securities and Exchange Commission (collectively the "Filings") contain or may contain forward looking statements and information that are based upon beliefs of, and information currently available to, our management as well as estimates and assumptions made by our management. When used in the filings the words "anticipate", "believe", "estimate", "expect", "future", "intend", "plan" or the negative of these terms and similar expressions as they relate to us or our management identify forward looking statements. Such statements reflect our current view with respect to future events and are subject to risks, uncertainties, assumptions and other factors (including the risks contained in the Filings) relating to our industry and our operations and results of operations. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended or planned.

         Although we believe that the expectations reflected in the forward looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements and except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results. The following discussion should be read in conjunction with the exhibits attached to this Current Report on Form 8-K.

Entry into a Material Definitive Agreement

Amendment to Loan Agreement

On June 29, 2009, Elephant Talk Communications, Inc. (the “Company”) and QAT II Investments SA (“QAT”) entered into an amendment (the “Amendment”) to loan agreements dated January 27, 2009, February 15, 2009, March 4, 2009, March 31, 2009, May 4, 2009, and May 27, 2009, (collectively, the “Loan Agreements”) for an aggregate of $4,334,961 (based on a Euro – Dollar exchange rate of $1.4029).  The Loan Agreements had previously had a maturity date of June 30, 2009.  The Amendment extended the maturity date of the Loan Agreements to July 15, 2009. QAT is affiliated with certain of the Company ’ s directors

The QAT II Investments Loan Agreement of July 1, 2009

On July 1, 2009, the Company entered into a Loan Agreement (the “July Loan Agreement”) with QAT. Pursuant to the July Loan Agreement, QAT agreed to lend to the Registrant the sum of €150,000 (or $210,435 based on the June 30, 2009 exchange rate published in the Wall Street Journal on July 1, 2009).  The proceeds of the July Loan Agreement were made available to the Registrant on July 1, 2009.  

The July Loan Agreement provides that Company will pay QAT interest at a rate of twelve percent (12%) per annum on the outstanding balance and provides the principal and interest shall be repaid by July 15, 2009.  The outstanding principal and interest shall become immediately due and payable in the event the Company fails to make required payments of principal and interest, or otherwise breaches the July Loan Agreement and fails to cure such breach upon twenty (20) days notice, or if it disposes of its properties or assets without QAT’s prior consent, or if it files a petition for bankruptcy or otherwise resolves to wind up its affairs.
 
Item 2.03
Creation of a Direct Financial Obligation

As more fully described in Item 1.01 of this Current Report, which information is incorporated by reference into this Item 2.03, the Company entered into the Amendment with QAT, thereby extending the maturity date of the Loan Agreements from June 30, 2009 to July 15, 2009.
 
As more fully described in Item 1.01 of this Current Report, which information is incorporated by reference into this Item 2.03, the Company entered into the July Loan Agreement with QAT, thereby creating direct financial obligations.
 
Item 9.01
Exhibits

(d) Exhibits

Exhibit
No.
Description

10.1
Amendment, dated June 29, 2009, by and among the Company and QAT.
     
 
10.2
July Loan Agreement dated July 1, 2009, by and between the Company and QAT.  

2

SIGNATURES

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

 
  ELEPHANT TALK COMMUNICATIONS, INC.  
       
       
       
 
By:
/s/ Steven van der Velden   
    Steven van der Velden   
    President, Chief Executive Officer   
       

Dated:  July 2, 2009

3
 
Exhibit 10.1
 
AMENDMENT TO LOAN AGREEMENTS


THIS AMENDMENT (this “ Amendment ”) to the Loan Agreement dated January 27, 2009, the Loan Agreement dated February 15, 2009, the Loan Agreement dated March 4, 2009, the Loan Agreement dated March 31, 2009, the Loan Agreement dated May 4, 2009 and  the Loan Agreement dated May 27, 2009  (collectively, the “ Loan Agreements ”) by and among QAT II Investments SA (“Lender”) and Elephant Talk Communication, Inc. (“Borrower”), is entered into by the parties hereto as of this 29 th day of June, 2009.
 
RECITALS:
 
WHEREAS, pursuant to the Loan Agreements, Lender has loaned to Borrower an aggregate amount of €3,090,000;
 
WHEREAS, each of the Loan Agreements provides that if the principal amount loaned to Borrower is due and payable on or before June 30, 2009 if the Lender and the Borrower do not execute an investment agreement on or before such date;
 
WHEREAS, the Lender and the Borrower

NOW, THEREFORE, in consideration of the premises, the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
 
1.      Article 3 of each the Loan Agreements is hereby amended by restating Article 3 to read in its entirety as follows:
 
Article 3 – Repayment of Principal.
 
 
If the Lender and the Borrower sign an investment agreement (the “Investment Agreement”) then the amount of the loan and the interest will then be deducted from the amount that has to be paid by the Lender pursuant to the investment agreement.
 
If no Investment Agreement between the Lender and the Borrower is executed, the loan and the interest will be repaid in full to Lender on or before July 15, 2009.
 
If the amount of the investment pursuant to the Investment Agreement is less than the loan made to the Borrower pursuant to this Agreement, the balance of the loan shall be paid to Lender simultaneously with the execution of the Investment Agreement.
 
2.      The parties hereto hereby ratify and reaffirm the Loan Agreements, as amended and modified by this Second Amendment.
 
 
 
 
 
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above-written.
 
 

 
 
The Lender:
 
QAT II Investments S.A.
 

 
By: /s/   Yves van Sante ______
Name: Yves van Sante
Title: Chief Executive Officer


The Borrower

Elephant Talk Communications, Inc.


By: /s/ Steven van der Velden
Name: Steven van der Velden
Title: Chief Executive Officer
 
 
 
 
 
 
Exhibit 10.2
LOAN AGREEMENT


BETWEEN:


1.   
QAT II INVESTMENTS SA, a limited liability company organized and existing under Luxembourg law, with registered office at L-2419 Luxembourg 7 Rue du fort Rheinsheim, registered in the Luxembourg company register under n° B 116261, in this duly represented by M. Yves VAN SANTE and M. Luc KINDT, both Director,

hereafter referred to as the “”, on the one hand,

AND


2.  
ELEPHANT TALK COMMUNICATION Inc. , with registered office at World Trade Center, Schiphol Boulevard 249, 1118 BH SCHIPHOL, The Netherlands, in this duly represented by M. Steven VAN DER VELDEN,   Chief Executive Officer,

hereafter referred to as the ‘ ’ on the other hand


WHEREAS:

1.  
The Lender is a closed end fund with participations in Belgium and the Netherlands;
2.  
The Lender is interested in an investment in the Borrower depending on a satisfactory outcome of the due diligence;
3.  
The Lender meanwhile orally agreed to provide the Borrower with a loan of EUR 150.000 as a short term bridging loan;
4.  
The parties wish to set forth in writing the terms and conditions upon which the Lender makes its loan available to the Borrower.


THE PARTIES HAVE AGREED AS FOLLOWS:


Article 1 – Amount

The Lender agrees under terms and conditions hereinafter set forth to provide the Borrower with a loan in the principal amount of EUR 150.000.- and the Borrower hereby agrees to borrow this principal amount of EUR 150.000.- from the Lender.

The Lender agrees that this amount will be made available to the Borrower as of 01.07.2009 by transferring, on behalf of the Borrower, EUR 150.000,- to the account of Elephant Talk Communications Carrier Services GmbH, Credit Suisse , Zug (Switserland), account n° : IBAN: CH41 0483 5052 0104 5200 0, SWIFT: CRESCHZZ80A.
 
 
 
 
 
 
 
Article 2 – Interest.

The Borrower shall pay to the Lender interest on the amount outstanding under this loan at a rate of 12 percent per annum. The interest calculation is to be done on a 365/365 days basis.


Article 3 - Repayment of principal.

If the Lender and the Borrower sign a investment agreement the amount of the loan and the interest will as then be deducted from the amount that has to be paid by the Lender at signature of the investment.

If no contra ct between the Borrower and the Lender is signed the loan and the interests will be repaid in full to QAT at the latest 15.07 .2009.

If the amount of the investment would be less than the amount of the investment, the remaining will be repaid to the Lender.


Article 4 - Prepayment.

The Borrower shall be allowed at all times to prepay the (remaining) outstanding amount without any penalty being due and without the consent of the Lender.


Article 5 - Payment.

Payments of interest, principal amounts or other amounts due hereunder shall be remitted without any deduction for or on account of any tax whatsoever by transfer of immediately available funds to a bank account of the Lender designated by the Lender in writing to the Borrower.

Any payments by the Borrower hereunder shall be applied first to payment of accrued and unpaid interest through the date of payment and then to the payment of the outstanding principal balance of the loan.


Article 6 – Defaults.

The outstanding amount and all interest and all costs shall become immediately due and payable to the Lender upon issuance of a simple payment order in the name of the Lender to the Borrower if and when:

i.  
the Borrower fails to pay the interest and costs due and/or fails to repay the outstanding amounts of the loan when due and/or acts contrary to or fails to meet or fulfil any provision of this agreement and – after having been requested to fulfil its obligations by registered letter – neglects to do so for a period of 20 (twenty) days after the date of the said notification;
 
 
 
 
 
 
 
ii.  
Other than in the ordinary course of business, the Borrower transfers, sells or otherwise disposes of its properties or assets without the Lender’s prior written consent;

iii.  
a petition is presented or a resolution passed for the Borrower’s winding up, bankruptcy, moratorium of payment or any (other) voluntary arrangement or administration order or any proposal or petition therefore or any distress, execution or other process levied or any receiver or any encumbrances appointed.


Article 7 - Notices.

All notices which are required or may be given pursuant to the terms of this agreement shall be in writing and shall be deemed given when delivered by hand or, if given by telecopy or telefax, when sent or, if mailed, shall be deemed given five (5) days after the date when sent by registered or certified mail, postage prepaid. The addresses of the parties hereto for purposes of notices, requests, demands and other communications are as set out at the beginning of this agreement or such other address as any party hereto shall have designated by notice in writing to the other party hereto.

 
Article 8 – Miscellaneous

1.
The obligations which the Borrower has assumed by way of this agreement have also been assumed by the Borrower for its legal successors by singular title.

2.
The Borrower is not entitled to assign its rights and obligations under this agreement to a third party. If the Lender has given the Borrower written permission to assign the rights and obligations under this agreement to one or more third parties, the Borrower undertakes vis-à-vis the Lender to impose the Borrower’s obligation vis-à-vis the Lender on those third parties by way of a perpetual clause.

 
The Lender is entitled to assign its rights and obligations under this agreement to a third party.

 
The Borrower undertakes at all times to render its cooperation in an assignment by the Lender of all or part of the loan and to acknowledge such assignment in writing and without any reservations.

3.
Except in the event of explicit reference, this agreement contains the full agreement between the Lender and the Borrower with respect to this loan. All prior oral or written agreements, statements or obligations between the Lender and the Borrower in this regard hereby cease to exist.
 
 
 
 
 
 
 
4.
This agreement will take effect upon the signing of this agreement and will end as soon as the Lender has nothing more to claim from the Borrower on the basis of this loan.

5.
The obligations under this agreement are indivisible.


Article 9 - Governing Law.

This agreement shall entirely be governed by and construed in accordance with the laws of Luxembourg.


Article 10 - Jurisdiction.

Any and all disputes arising from or connected with this agreement or any amendment thereof shall be settled exclusively by the competent court of Luxembourg.


Executed in two originals in Luxembourg on 01.07.2009 and each party acknowledging having received one original hereof:
 
 
The Lender:
The Borrower:
   
Elephant Talk Communication Inc
represented by
represented by
   
   
   
   
/s/ Yves van Sante
/s/ Steven van der Velden
Yves VAN SANTE
Steven VAN DER VELDEN
Chief Executive Officer 
CEO
   
   
   
   
/s/ Luc Kindt
 
Luc KINDT
 
Director