Item 1.01 Entry into a Material Definitive Agreement.
The information set forth below under Item 2.03 is hereby incorporated by reference into this Item 1.01.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant.
On
The PPP Loan provides for working capital to the Company and will mature on
The Company is enacting certain measures aimed at cutting costs and attempting
to address operational challenges. Consequently, the Company's President and CEO
agreed to reduce his compensation by 85%. The Company is accruing all
compensation not paid to
The foregoing summary of the PPP Loan is qualified in its entirety by reference to the PPP Loan Agreement, which is attached as Exhibit 10.1 hereto.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Due to economic circumstances related to the global coronavirus outbreak 2019
(COVID-19), on
Item 8.01 Other Events.
On
Due to the outbreak of the COVID-19 pandemic, the Company is filing this Current
Report on Form 8-K to report that it is postponing the filing of its Quarterly
Report on Form 10-Q for the first quarter ended
We require additional time to finalize and file our Form 10-Q due to significant
disruptions to our business and operations we are experiencing as a result of
the COVID-19 pandemic and related cautionary measures. In accordance with stay
at home orders that have been issued in the
The Company has had diminishing operating revenue as well as limited cash and cash equivalents and has been incurring operating losses. Furthermore, the current global COVID-19 pandemic has added even greater pressure on the Company's ability to operate efficiently.
We expect to file our Form 10-Q no later than
Set forth below is a risk factor regarding the risks related to the impact of
COVID-19 pandemic on our business and results of operations. We are
supplementing the risk factors previously disclosed in "Item 1A. Risk Factors"
of our Form 10-K with the following risk factor, which should be read in
conjunction with the other risk factors presented in the Annual Report on Form
10-K for the year ended
We face significant business disruption and related risks resulting from the COVID-19 pandemic, which could have a material adverse effect on our business and results of operations.
The ongoing and developing COVID-19 pandemic has caused a broad impact globally. While the potential economic impact brought by, and the duration of, the COVID-19 pandemic is difficult to assess or predict, any resulting recession or economic slowdown will have a negative impact on our business and results of operations.
We rely on third-party suppliers and manufacturers in
The COVID-19 pandemic has affected the global economy, potentially in a
significant adverse manner, resulting in an economic downturn that could impact
demand for our Gaucho products and affect tourism in
In addition, any significant disruption of global financial markets, reducing our ability to access capital, could negatively affect our liquidity. The COVID-19 pandemic could also negatively affect our internal controls over financial reporting, as a significant portion of our workforce is required to work from home and standard processes are disrupted. New processes, procedures, and controls may be required to ensure an effective control environment.
We are still assessing the impact the COVID-19 pandemic will have on our business and results of operations, but we anticipate that its impact will be significant. The exact impact is and will remain unknown and largely dependent upon future developments, including but not limited to information on the duration and spread of COVID-19, changes in customer demand, additional mitigation strategies proposed by governmental authorities (including federal, state, or local stay at home or similar orders), restrictions on the activities of our domestic and international suppliers and shipment of goods.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
10.1 Loan Agreement between the Company and
2020
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