Item 8.01 Other Events
As previously disclosed,
The LOI envisages that:
? the Loan will bear interest at 15% payable monthly in cash, provided that (i)
for the first six months New Presto may choose to pay 100% of the interest in
kind and (ii) for the following 12 months New Presto may elect to pay 50% of
the interest in kind;
? the Loan will mature thirty months following the Closing;
? the Loan will be secured by a first priority lien on substantially all of New
Presto' real and personal property and will be guaranteed by each of New
Presto's subsidiaries;
? the definitive agreement containing the final terms of the Loan (the "Loan
Documentation") will contain closing conditions, representations and
warranties, events of default and covenants that are customary for term loans
of this type, including covenants requiring the maintenance of minimum
unrestricted cash on New Presto's balance sheet and a ratio of the amount of
the Loan outstanding, less New Presto's unrestricted cash on its balance sheet,
to its annualized rolling 3-month revenue;
? New Presto will pay Metropolitan an initial onboarding fee of
Closing Date and a quarterly monitoring fee of
? New Presto may prepay the Loan at any time, but if such prepayment is prior to
the 18 month anniversary of the Closing Date, it must include an amount of
interest and fees that would have accrued up until such anniversary;
? so long as any of the Loan remains outstanding, Metropolitan will have board
observer rights;
? Metropolitan will receive 1,500,000 warrants to purchase shares of New Presto
common stock that are nonredeemable, exercisable on a cashless basis and have
an exercise price of
amended and restated warrant agreement that will be entered in connection with
the Closing;
? Metropolitan will receive 600,000 shares of New Presto common stock from VTAQ's
founders; and
? New Presto will pay Metropolitan all of its reasonable and documented expenses,
including legal fees.
The entry into the Loan Documentation in a form satisfactory to the parties is subject to the completion of Metropolitan's due diligence and other conditions. No assurance can be given that the Loan Documentation will be entered into or that it will contain terms identical to those described above. Upon entry into the Loan Documentation, VTAQ will file a current report on Form 8-K disclosing the final terms of the Loan.
The entry into the Loan Documentation is also subject to VTAQ and the Investors reaching a mutually satisfactory agreement to terminate the Agreement. VTAQ and the Investors have discussed certain terms including payment of fees and expenses incurred by the Investors, the issuance to the Investors of 400,000 shares of New Presto common stock as well as the transfer of 500,000 warrants currently held by VTAQ's founders.
Neither VTAQ nor Presto can offer any assurance that the Loan Documentation will be entered into or that an agreement will be reached to terminate the Agreement. If such agreements are not reached, the Agreement will continue in effect subject to its terms.
VTAQ will make further disclosure if the Loan Documentation is executed or if the Agreement is terminated. The disclosures provided herein is intended to disclose information that may be material to any investment and/or voting decision in connection with VTAQ's upcoming special meeting.
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