FTE NETWORKS, INC. (OTCMKTS:FTNW) Files An 8-K Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
On December 30, 2020, FTE Networks, Inc. (the “Company”) and certain affiliated entities received a notice of default (the “Notice”) from DS Agent LLC, in its capacity as successor Noteholder Agent (“DS Agent”), asserting that an event of default had occurred with respect to certain Note Issuance and Purchase Agreements, each dated as of July 10, 2017, by and among, inter alia, certain entities controlled by the Company, Inmost (the original Noteholder Agent), and noteholders named therein (the “Note Purchase Agreements”). Specifically, DS Agent claimed that the Company failed to satisfy the loan-to-value test (the “LTV Test”) as defined in the Note Purchase Agreements and demanded that the Company pay the outstanding principal balance due under each of the Note Purchase Agreements. The Notice also stated that DS Agent would be exercising certain rights under the Note Purchase Agreements. The noteholders, collectively, hold approximately $52,000,000 in notes (inclusive of accrued interest) that the Company assumed as part of the Rental Home Portfolio Asset Purchase Agreement. If DS Agent exercises additional remedies, such exercise may have a material adverse effect on the Company’s financial condition and the Company’s ability to continue to operate. The Company intends to negotiate a resolution of this matter, of which no assurance can be given.
About FTE NETWORKS, INC. (OTCMKTS:FTNW)
FTE Networks, Inc., (FTE Networks) is a provider of international and regional telecommunications and technology systems, and infrastructure services. The Company’s segments are Telecommunications and Staffing. It also offers managed information technology, telecommunications services, subscriber-based services and staffing solutions through its subsidiaries, Jus-Com, Inc. (doing business as FTE Network Services), FTE Wireless, LLC and Focus Venture Partners, Inc. (doing business as FVP Worx). Its services include engineering consulting, design, installation, maintenance and emergency response in various categories, including cabling, equipment installation and configuration, rack and stack, wiring build-outs, infrastructure build-outs, direct current power installation, online service provider/Internet service provider fiber placement, fiber cable splicing and testing. In the wireless space, it provides engineering, design, installation and upgrade of wireless communications networks.