Current Report Filing (8-k)
May 25 2017 - 4:52PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) May 20, 2017
Net Element, Inc.
(Exact Name of Registrant as Specified
in Charter)
Delaware
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001-34887
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90-1025599
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(State
or Other Jurisdiction
of Incorporation)
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(Commission
File
Number)
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(IRS
Employer
Identification No.)
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3363
NE 163rd Street, Suite 705, North Miami Beach, FL
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33160
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(Address
of Principal Executive Offices)
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(Zip
Code)
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(305)
507-8808
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(Registrant’s
telephone number, including area code)
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Not
Applicable
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(Former
Name or Former Address, if Changed Since Last Report)
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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:
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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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
o
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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.
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Item 1.01
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Entry into a Material Definitive Agreement.
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On May 20, 2017, Net
Element, Inc. (the “Company”), Maglenta Enterprises Inc. (“Maglenta”) and Champfremont Holding Ltd. (“Champfremont;”
together with Maglenta collectively the “Sellers”) entered into the Amendment (the “Amendment”) to the
Settlement Agreement effective as of October 21, 2016 (the “Settlement Agreement”). The Amendment was accepted and
agreed to by TOT Group Europe, Ltd., ТOT Group Russia LLC, each a subsidiary of the Company.
Pursuant to the Amendment,
Section 1 of the Settlement Agreement was amended in its entirety to reflect the new terms under which the Company agreed to pay
to the Sellers an aggregate of $1,792,071 (the “Principal Balance”) plus $29,604 in interest in installments pursuant
to the payment schedule set forth in Exhibit A to the Amendment. Further, Subsections 2 (a) through (f) of the Settlement Agreement
were amended in their entirety to reflect the new amounts and dates of such payments (consistent with the payment schedule set
forth in Exhibit A to the Amendment) and to provide for the remedies to the Sellers if any payment is past due for more than 5
business days. Further, Exhibit B, attached to the Settlement Agreement, showing amounts and timing for payments, assuming timely
payment of all amounts due, was replaced by Exhibit A attached to the Amendment. The Company already made the initial installment
payment to the Sellers in the amount of $800,000.
The foregoing is a
summary description of certain terms of the Amendment and, by its nature, is incomplete. Copy of the Amendment (including Exhibit
B to the Amendment) is filed herewith as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
All readers are encouraged to read the entire text of the Amendment (including Exhibit B to the Amendment).
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Item 2.03
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Creation of a Direct Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement of a Registrant.
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On May 24, 2017, the
Company opted to exchange a tranche in the aggregate amount of $150,000 for 230,875 shares of the Company common stock based on
the exchange price of $0.6497 per share for this tranche pursuant to the Master Exchange Agreement (as amended, the “Agreement”)
with Crede CG III, Ltd. (“Crede”). The Agreement and its terms were disclosed in our Current Report on Form 8-K filed
on May 3, 2016 and our Current Report on Form 8-K filed on March 8, 2017. Such shares of common stock of the Company were issued
to Crede under an exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities
Act”), in reliance upon Section 3(a)(9) of the Securities Act.
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Item 3.02
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Unregistered Sales of
Equity Securities.
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The disclosure provided
in Item 2.03 of this Report is hereby incorporated by reference into this Item 3.02.
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Item 9.01
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Financial Statements
and Exhibits.
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Exhibit
Number
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Description
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10.1
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A
mendment
of Settlement Agreement among Net Element, Inc., Maglenta Enterprises Inc. and Champfremont
Holding Ltd. (accepted and agreed to by TOT Group Europe, Ltd., TOT Group Russia LLC)*
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_________________
*Filed herewith.
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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.
Dated: May 24, 2017
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NET ELEMENT, INC.
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By:
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/s/ Jonathan
New
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Name: Jonathan New
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Title: Chief Financial Officer
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EXHIBIT INDEX
Exhibit
Number
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Description
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10.1
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A
mendment
of Settlement Agreement among Net Element, Inc., Maglenta Enterprises Inc. and Champfremont
Holding Ltd. (accepted and agreed to by TOT Group Europe, Ltd., TOT Group Russia LLC)*
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_________________
*Filed herewith.
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