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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:
February
28, 2024
Gaucho
Group Holdings, Inc.
(Exact
name of registrant as specified in its charter)
Delaware |
|
001-40075 |
|
52-2158952 |
State
of
Incorporation |
|
Commission
File Number |
|
IRS
Employer
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) |
|
|
|
|
☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
|
|
|
☐ |
Pre-commencement
communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
|
|
|
☐ |
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
2.04. Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.
As
previously reported on our Current Report on Form 8-K filed on February 21, 2023, Gaucho Group Holdings, Inc. (the “Company”)
entered into a Securities Purchase Agreement (the “Purchase Agreement”) with 3i, LP (“3i”), pursuant to which
the Company sold to 3i a series of senior secured convertible notes of the Company in the aggregate original principal amount of $5,617,978
(the “Notes”), and a series of common stock purchase warrants of the Company, which warrants shall be exercisable into an
aggregate of 337,710 shares of common stock of the Company for a term of three years (the “Warrants,” and together with the
Purchase Agreement and Notes, the “Note Documents”). For the full description of the Note Documents, please refer to our
Current Report on Form 8-K and the exhibits attached thereto as filed with the SEC on February 21, 2023. All terms not defined herein
shall refer to the defined terms in the Note Documents.
As
disclosed on our Current Report on Form 8-K filed February 27, 2024, on February 21, 2024, the Company received an Event of Default Redemption
Notice from 3i providing notice of Events of Default arising under the Note Documents and demanding immediate payment of the Event of
Default Redemption Price equal to a minimum of $3,437,645.74.
On
February 28, 2024, the Company received a second Event of Default Redemption Notice from 3i providing notice of an additional Event of
Default arising under the Note Documents, and demanding immediate payment of the Event of Default Redemption Price equal to a minimum
of $3,450,711.22.
Upon
an Event of Default, the interest rate on the outstanding principal will automatically be increased from 7% to 18% per annum, and 3i
may require the Company to redeem all or any portion of the Note at a price equal to the greater of (i) the product of (A) the amount
to be redeemed multiplied by (B) the redemption premium of 115%, and (ii) the product of (X) the conversion rate in effect at such time
as 3i delivers an Event of Default redemption notice, multiplied by (Y) the product of (1) the redemption premium of 115% multiplied
by (2) the greatest closing sale price of the common stock on any trading day during the period commencing on the date immediately preceding
such Event of Default and ending on the date the Company makes the entire payment required to be made under the Note Documents.
Additionally,
3i may, at its option, convert the Note into shares of common stock of the Company at an alternate conversion price. The remedies provided
in the Note are cumulative and in addition to all other remedies available to 3i at law or in equity (including a decree of specific
performance and/or other injunctive relief).
In
addition to the remedies provided under the Note Documents, 3i also holds a security interest in all of the assets of the Company, including
intellectual property and the Company’s ownership interests in each of its subsidiaries, pursuant to that certain Security and
Pledge Agreement and Intellectual Property Security Agreement each dated February 21, 2023 (together, the “Security Agreement”).
Upon the occurrence of an Event of Default under the Note, the collateral agent appointed under the Security Agreement may exercise all
of the rights and remedies of a secured party upon default under the New York Uniform Commercial Code, and may, among other things, (i)
take absolute control of the collateral and receive, for the benefit of 3i, all payments made thereon, give all consents, waivers, and
ratifications in respect thereof and otherwise act with respect thereto as through it were the outright owner thereof, (ii) require each
grantor to make the collateral available to the collateral agent, and (iii) sell, lease, license, or dispose of the Collateral.
The
Company believes that this Event of Default Redemption Notice from 3i is in response to the Company’s lawsuit filed in the United
States District Court for the District of Delaware alleging that 3i engaged in an unlawful securities transaction with the Company as
an unregistered dealer under U.S. securities laws. 3i is considered a “dealer” within the meaning set forth in Section 3(a)(5)(A)
the Securities Exchange Act of 1934 (“Exchange Act”) and, therefore, violated Section 15(a) by engaging in interstate securities
transactions with the Company absent effective dealer registration. Because of 3i’s violations of Section 15(a) of the Exchange
Act, the Company is seeking to have certain contracts between it and 3i declared void and transactions effectuated thereunder rescinded
pursuant to Section 29(b) of the Exchange Act. Please see our Current Report on Form 8-K as filed with the SEC on February 20, 2024.
Item
5.07 Submission of Matters to a Vote of Security Holders.
The
Company virtually convened a 2024 Special Stockholder Meeting (the “Meeting”) on February 29, 2024 at 12:00 p.m. Eastern
Time. A quorum was present for the Meeting.
At
the Meeting, four proposals were submitted to the stockholders for approval as set forth in the definitive Proxy Statement as filed with
the SEC on January 22, 2024. As of the record date, January 3, 2024, a total of 4,807,938 shares of common stock of the Company were
issued and a total of 4,807,909 shares of common stock were outstanding and entitled to vote. The holders of record of 2,111,089 shares
of common stock were present in person or represented by proxy at said Meeting for a total of 2,111,089 votes represented at the meeting.
Such amount represented 43.91% of the shares entitled to vote at such meeting.
At
the meeting, the stockholders approved three of the four proposals submitted. The first proposal is moot, since Tumim Capital LLC
terminated the ELOC prior to the meeting, but the vote was held anyway. The fourth proposal was not approved by the stockholders.
The votes on the proposals were cast as set forth below:
|
1. |
Proposal
No. 1 – Full Issuance of Shares in Connection with an ELOC. As reported in the Company’s Current Report on Form 8-K filed
February 27, 2024, on February 22, 2024, the Company received notice from its investor in the equity line of credit (“ELOC”)
that it was electing to terminate the ELOC, effective immediately. While the ELOC was terminated prior to the meeting, the Company
nevertheless held the vote as described in the Proxy Statement, and the stockholders approved the full issuance of shares of common
stock in connection with the ELOC. |
Shares FOR | | |
Shares AGAINST | | |
ABSTAIN | | |
Broker Non- Vote | |
| 1,191,759 | | |
| 284,356 | | |
| 283 | | |
| 634,691 | |
|
2. |
Proposal
No. 2 – Reverse Stock Split. The stockholders approved the grant to the Board of Directors of discretion on or before June
30, 2024, to implement a reverse stock split of the outstanding shares of common stock in a range of one-for-two (1:2) up to one-for-ten
(1:10). |
Shares FOR | | |
Shares AGAINST | | |
ABSTAIN | |
| 1,463,158 | | |
| 647,533 | | |
| 398 | |
|
3. |
Proposal
No. 3 – Full Issuance of Shares in a Private Placement. The stockholders approved the full issuance of shares of our common
stock to be issued in a private placement of common stock for gross proceeds of up to $7.2 million pursuant to Rule 506(b) of the
Securities Act of 1933. |
Shares FOR | | |
Shares AGAINST | | |
ABSTAIN | | |
Broker Non- Vote | |
| 1,083,464 | | |
| 392,635 | | |
| 299 | | |
| 634,691 | |
|
4. |
Proposal
No. 4 – Full Issuance of Shares Pursuant to the Security Purchase Agreement. The stockholders did not approve the full issuance
and exercise of shares of our common stock to be issued pursuant to that certain securities purchase agreement, senior secured convertible
promissory note, common stock purchase warrant, and registration rights agreement, each dated February 21, 2023 by and between the
Company and an institutional investor. |
Shares FOR | | |
Shares AGAINST | | |
ABSTAIN | | |
Broker Non- Vote | |
| 618,319 | | |
| 818,788 | | |
| 39,291 | | |
| 634,691 | |
Item
7.01 Regulation FD Disclosure.
The
information set forth in Item 2.04 of this Current Report on Form 8-K is incorporated herein by reference into this Item 7.01 in its
entirety.
For
a recording of the 2024 Special Stockholder’s Meeting which includes commentary by the Company’s President and CEO, Scott
Mathis, please see: https://www.cstproxy.com/gauchogroupholdings/sm2024.
The
information furnished with this Item 7.01 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange
Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated
by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, regardless
of any general incorporation language in such filing.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits
104 |
|
Cover
Page Interactive Data File (embedded within the Inline XBRL document) |
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 1st day of March 2024.
|
Gaucho
Group Holdings, Inc. |
|
|
|
|
By: |
/s/
Scott L. Mathis |
|
|
Scott
L. Mathis, President & CEO |
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