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 certain 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, an “Existing Note” and together with the Securities Purchase Agreement, the “Existing Note Documents”).
On
September 22, 2022, the Company and the Holders entered into an exchange agreement (the “Exchange Agreement”) with the Holders
in order to amend and waive certain provisions of the Existing Note Documents and exchange (the “Exchange” or the “Transaction”)
$100 in aggregate principal amount of each of the Existing Notes (the “Exchange Notes”), on the basis and subject to the
terms and conditions set forth in the Exchange Agreement, for warrants (the “Warrants”) to purchase up to 1,090,983 shares
of the Company’s Common Stock (the “Warrant Shares”) at an exercise price of $0.3182 (subject to customary adjustment
upon subdivision or combination of the common stock). The Exchange Agreement, the Exchange or Transaction, the Exchange Notes, the Warrants,
and the Warrant Shares are collectively referred to as the “Exchange Documents.”
The
Exchange Agreement amends the original terms of payment of the Existing Notes and waives payment of principal and interest
due on each of September 7, 2022 and October 7, 2022. All principal, interest, and fees are due on the maturity date of the November
9, 2022.
The
Warrants are immediately exercisable and may be exercised at any time, and from time to time, on or before the third anniversary of the
date of issuance. The Warrant includes a “blocker” provision that, subject to certain exceptions described in the Warrant,
prevents the Investors from exercising the Warrant to the extent such exercise would result in the Investors together with certain affiliates
beneficially owning in excess of 4.99% of the Common Stock outstanding immediately after giving effect to such exercise.
The
foregoing descriptions of the Exchange Agreement and the Warrant are summaries only, do not purport to be complete and are qualified
in their entirety by the full text of these documents, copies of which are attached as Exhibits 10.1 and 4.1, 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.