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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:
May
2, 2022
Gaucho
Group Holdings, Inc.
(Exact
name of registrant as specified in its charter)
| Delaware |
|
001-40075 |
|
52-2158952 |
| State
of |
|
Commission
|
|
IRS
Employer |
| Incorporation |
|
File
Number |
|
Identification
No. |
112
NE 41st Street, Suite 106
Miami,
FL 33137
Address
of principal executive offices
212-739-7700
Telephone
number, including
Area
code
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
communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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|
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☐ |
Pre-commencement
communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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|
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☐ |
Pre-commencement
communication 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 (17 CFR §230.405)
or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
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.
Securities
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 |
|
VINO |
|
The
Nasdaq Stock Market LLC |
Item
1.01 Entry into a Material Definitive Agreement
As
previously reported on our Current Report on Form 8-K filed on November 8, 2021, Gaucho Group Holdings, Inc. (the “Company,”
“we,” “us” or “our”), and the investors (the “Holders”) entered into that Securities
Purchase Agreement, dated as of November 3, 2021 (as the same has been amended, restated, amended and restated, supplemented or otherwise
modified prior to the date hereof, the “Securities Purchase Agreement”) and the Company issued to the Holders certain senior
secured convertible notes (as the same has been amended, restated, amended and restated, supplemented or otherwise modified prior to
the date hereof, each, a “Note” and together with the Securities Purchase Agreement, the “Note Documents”).
Also
as previously reported on our Current Report on Form 8-K filed March 1, 2022, on February 22, 2022, the Company entered into an exchange
agreement (the “Exchange Agreement”) with the Holders in order to amend and waive certain provisions of the Note Documents
and exchange $100 in aggregate principal amount of each of the Notes. The Note Documents and the Exchange Agreement are referred to herein
as the Transaction Documents. All terms not defined in this Current Report are as set forth in the Transactional Documents and the
Letter Agreement described below.
For
the full description of the Transaction Documents, please refer to our Current Reports on Forms 8-K and the exhibits attached thereto
as filed with the SEC on November 8, 2021 and March 1, 2022.
On
May 2, 2022, the Company and the Holders entered into a letter agreement (the “Letter Agreement”) pursuant to which the parties
agreed to reduce the Conversion Price from $3.50 to $1.35 for the period beginning May 2, 2022 through May 13, 2022 (the “Reduced
Price Conversion Period”). The Holders may not convert collectively more than $2,000,000 of the outstanding Principal of the Notes
during the Reduced Price Conversion Period. The Holders have waived the Amortization Redemption Amount due on the Amortization Date of
May 7, 2022 and such will be due in full on the next scheduled Amortization Date. Further, any conversion of amounts under the Note pursuant
to the Letter Agreement shall be applied first to the Extended Payments.
The
Company and the Holders may further adjust the Conversion Price upon mutual consent in accordance with the Transaction Documents.
The
foregoing description of the Letter Agreement is a summary only, does not purport to be complete and is qualified in its entirety by
the full text of the document, a copy of which is attached as Exhibit 10.1, and incorporated herein by reference.
The
representations, warranties and covenants contained in the agreements described in Item 1.01 of this Current Report on Form 8-K are not
intended to be a source of factual, business or operational information about the Company; were made only for purposes of such agreements
and as of specific dates; were solely for the benefit of the parties to such agreements and may be subject to limitations agreed upon
by the parties, including being qualified by disclosures for the purpose of allocating contractual risk between the parties instead of
establishing matters as facts; and may be subject to standards of materiality applicable to the contracting parties that differ from
those applicable to investors or security holders. Accordingly, investors should not rely on the representations, warranties and covenants
or any descriptions thereof as characterizations of the actual state of facts or condition of the parties.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The
information set forth in Item 1.01 of this Current Report on Form 8-K with respect to the Letter Agreement is incorporated by reference
into Item 2.03 of this Current Report on Form 8-K.
Item
3.02 Unregistered Sales of Equity Securities.
The
information set forth in Item 1.01 of this Current Report on Form 8-K with respect to the Letter Agreement is incorporated by reference
into Item 3.02 of this Current Report on Form 8-K.
The
shares of common stock that have been and may be issued under the Transaction Documents and the Letter Agreement are being offered and
sold in a transaction exempt from registration under the Securities Act of 1933, as amended, in reliance on Section 4(a)(2) thereof and/or
Rule 506(b) of Regulation D thereunder. The Company filed a Form D with the SEC on or about November 9, 2021.
Subsequently,
the Company filed a resale registration statement on Form S-1 to register up to 12,164,213 shares of our common stock for resale by certain
institutional investors upon conversion of the Notes. The Form S-1 was declared effective on January 13, 2022.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized, on the 2nd day of May 2022.
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Gaucho
Group Holdings, Inc. |
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|
|
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By: |
/s/Scott
L. Mathis |
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|
Scott
L. Mathis, President & CEO |
Exhibit
10.1
 |
From the Desk of Scott Mathis
Direct: 212.739.7650
Fax: 212.655.0140
smathis@gauchoholdings.com |
May
2, 2022
[Investor]
Re:
Conversion Price Voluntary Adjustment Notice
Dear
Sirs:
Reference
is made to (a) that certain Securities Purchase Agreement dated as of November 3, 2021 (the “Purchase Agreement”)
between the Company and the buyers identified therein, including the addressee listed above (the “Investor”), (b)
that certain Amendment and Exchange Agreement dated as of February 22, 2022 between the Company and the Investor, (c) the senior secured
convertible note of the Company issued to the Investor (the “Note”), and (d) the other transaction documents, as modified
from time to time, referred to collectively, as the “Transaction Documents”. Capitalized terms used but not defined
herein shall have the meanings given to them in the Purchase Agreement, or if not defined therein, in the Note, or if not defined therein,
in the applicable Transaction Document, in each case as of the date hereof.
This
letter agreement (this “Letter Agreement”) confirms our recent discussions about, among other matters, certain modifications
to the Note.
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1. |
Pursuant to Section 7(g) of the Note, the Company hereby
reduces the Conversion Price of the Note to $1.35 for the Trading Days of May 2, 2022 through and inclusive of May 13, 2022 (the
“Reduced Price Conversion Period”). Any conversion which occurs shall be voluntary at the election of the Investor,
which shall evidence its election as to the Note being converted in writing on a Conversion Notice delivered in accordance with Section
3(c)(i) of the Note. |
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2. |
The Investor may not convert more than $____________
of the outstanding Principal of the Note, at the Conversion Price of $1.35 during the Reduced Price Conversion Period. |
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3. |
The Investor agrees to waive the Amortization Redemption
Amount due on the Amortization Date of May 7, 2022 and the associated Amortization Redemption Notice due May 2, 2022. Such Amortization
Redemption Amount will be due in full on the next scheduled Amortization Date. |
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4. |
In connection with any conversion of the Note in accordance
with this Letter Agreement, the Investor and the Company agree that notwithstanding anything to the contrary in any of the Transaction
Documents, including Section 12 of the Note, any conversion of amounts under the Note pursuant to this Letter Agreement shall be
applied first to the Extended Payments and in the following order: |
| |
a. |
Any accrued and unpaid Late Charges related to the
Principal amount of the May 7 Amortization Redemption Amount converted; then to |
gaucho
group holdings, Inc. group (nasdaq:vino)
112
NE 41st Street, Suite 106, Miami, FL 33137
(main)
212.739.7700 (fax) 212.655.0140 | www.gauchoholdings.com
| |
b. |
Any accrued and unpaid Interest (not including any
Make-Whole Amount) related to the Principal amount of the May 7 Amortization Redemption Amount converted; then to |
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c. |
The outstanding Principal amount of the May 7 Amortization
Redemption Amount converted; then to |
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d. |
Any Make-Whole Amount related to the Principal amount
of the May 7 Amortization Redemption Amount converted. |
This
Letter Agreement is a Transaction Document and is limited as written. As of the date first written above, each reference in the Purchase
Agreement or any other applicable Transaction Document to “this Agreement,” “hereunder,” “hereof,”
“herein,” or words of like import, and each reference in the other Transaction Documents to such Purchase Agreement
or other Transaction Documents (including, without limitation, by means of words like “thereunder,” “thereof”
and words of like import), shall refer to the Purchase Agreement and the other Transaction Documents as modified thereby, and this Letter
Agreement and the Purchase Agreement and/or the other Transaction Documents modified hereby, as applicable, shall be read together and
construed as a single agreement. The execution, delivery and effectiveness of this Letter Agreement shall not, except as expressly provided
herein, (A) waive or modify any right, power or remedy under, or any other provision of, any Transaction Document or (B) commit or otherwise
obligate any Purchaser to enter into or consider entering into any other amendment, waiver or modification of any Transaction Document.
All
communications and notices hereunder shall be given as provided in the Transaction Documents. This Letter Agreement (a) shall be governed
by and construed in accordance with the law of the State of New York, (b) is for the exclusive benefit of the parties hereto and the
beneficiaries of the Purchase Agreement set forth in Section 9(h) of the Purchase Agreement and, together with the other Transaction
Documents, constitutes the entire agreement of such parties, superseding all prior agreements among them, with respect to the subject
matter hereof, (c) may be modified, waived or assigned only in writing and only to the extent such modification, waiver or assignment
would be permitted under the Transaction Documents (and any attempt to assign this Letter Agreement without such writing shall be null
and void), (d) is a negotiated document, entered into freely among the parties upon advice of their own counsel, and it should not be
construed against any of its drafters and (e) shall survive the satisfaction or discharge of the amounts owing under the Transaction
Documents. The fact that any term or provision of this Letter Agreement is held invalid, illegal or unenforceable as to any person in
any situation in any jurisdiction shall not affect the validity, enforceability or legality of the remaining terms or provisions hereof
or the validity, enforceability or legality of such offending term or provision in any other situation or jurisdiction or as applied
to any person.
This
Letter Agreement is expressly conditioned on the following conditions precedent:
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(1) |
The
Company’s Board of Directors shall have approved this Letter Agreement and all undertakings thereto in all respects and shall
provide written evidence of the same to the Investor by Monday, May 2, 2022; and |
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(2) |
The
Company shall have verified and confirmed with its transfer agent that there are no impediments to the issuance of shares as a result
of this Letter Agreement. |
Kindly
confirm your agreement with the above by signing in the space indicated below and by PDFing an executed copy of this letter to the undersigned,
and which may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one
and the same agreement.
[Signatures
follow on next page]
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Very truly
yours, |
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|
GAUCHO
GROUP HOLDINGS, INC. |
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By: |
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Scott L Mathis |
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President & Chief
Executive Officer |
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| AGREED
AND ACCEPTED: |
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| Holder |
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| By: |
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| Name: |
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| Title: |
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