SITO MOBILE, LTD. (NASDAQ:SITO) Files An 8-K Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet ArrangementItem 2.04
On July 26, 2017, SITO Mobile, Ltd., (the “Company”) received a purported notice (the “Notice”) of default and acceleration of obligations under that certain Revenue Sharing and Note Purchase Agreement (the “Loan Agreement”), dated October 3, 2014 (and as amended March 1, 2016), by and among the Company, SITO Mobile Solutions, Inc., our wholly-owned subsidiary, SITO Mobile R&D IP, LLC, our wholly-owned subsidiary, Fortress Credit Co. LLC, and CF DB EZ LLC. As of June 30, 2017, there was approximately $4.5 million aggregate principal amount outstanding under the Loan Agreement. In addition, the Loan Agreement provides that the Revenue Purchaser (as defined in the Loan Agreement) is entitled to a revenue stream deriving from the Company’s patents, of up to (i) $5,000,000, if paid in full prior to March 31, 2018 and (ii) $7,500,000 thereafter, which could also be subject to acceleration following the occurrence of a bona fide Event of Default.
The purported notice of default alleges, without merit, that the Company had undergone a Change of Control under the terms of the Loan Agreement and has breached its obligations to provide timely information with respect to the Company’s intellectual property to the holders of notes under the Loan Agreement, in addition to other alleged minor technical and curable defaults. In fact, no Change of Control within the meaning of the Loan Agreement has occurred and the Company is in the process of providing fulsome and timely disclosure to the holders of the Notes in response to a request received four business days prior to the purported notice of default.
The Company believes that it has fully complied with all of the covenants under the Loan Agreement, and it believes each of the claims that an Event of Default has occurred are without merit and has provided notice of the same to the holder as attached to this Form 8-K as Exhibit 99.1. Nevertheless, in accordance with Instruction No. 3 to this Item, the Company is filing a Current Report on Form 8-K in respect of the Notice.
| Item 9.01 | Financial Statements and Exhibits. |
| Exhibit Number | |
| 99.1 | Letter to TAR SITO LendCo LLC |
SITO MOBILE, LTD. ExhibitEX-99.1 2 v471503_ex99-1.htm EXHIBIT 99.1 Exhibit 99.1 July 25,…To view the full exhibit click here
About SITO MOBILE, LTD. (NASDAQ:SITO)
SITO Mobile, Ltd. operates a mobile location-based advertising platform serving businesses, advertisers and brands. The Company’s offerings include SITO Location-Based Advertising and SITO Mobile Messaging. SITO Location-Based Advertising delivers display advertisements and videos on behalf of advertisers, including various features, such as Geo-fencing, Verified walk-in, Behavioral Targeting, and Analytics and Optimization. Geo-fencing targets customers within a certain radius of location and uses technology to push coupons, advertisements and promotions to mobile applications. Verified Walk-in tracks foot-traffic to locations and which advertisements drive action. Behavioral Targeting tracks past behaviors over 30 to 90 day increments allowing for real-time campaign management. Analytics and Optimization is a culling and building measurement system. SITO Mobile Messaging is a platform for building and controlling programs, including messaging and customer incentive programs.
