Presto Automation enters forbearance requiring $3M capital raise; warns stock could become worthless

Presto Automation Inc.

Forbearance requires raising $3M by May 22 ($2.5M by May 15) to extend to June 14; additional $3M by June 7 to extend to July 15.
Issued $1.5M subordinated convertible note to Remus Capital (board affiliate) at $0.14/share; PIK interest 7.5%.
Extended $4M secured note from Presto CA LLC maturity to forbearance end; anti-dilution trigger lowered to $0.14.
If forbearance ends, lenders can enforce remedies; company warns common stock may become worthless.

Key facts

Extracted from this filing and checked against the source text.

Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.95

Presto Automation Inc. entered into Cooperation Agreement with Metropolitan Partners Group Administration, LLC valued at Forbearance on defaults under Credit Agreement; requires capital raises of $3,000,000 and $3,000,000 (effective 2024-05-16).

Action: entry
Agreement: credit facility
Counterparty: Metropolitan Partners Group Administration, LLC
Value: Forbearance on defaults under Credit Agreement; requires capital raises of $3,000,000 and $3,000,000
Effective: 2024-05-16

Exact text from the filing

On May 16, 2024, the Company and Presto Automation LLC (the “Borrower”), the Company’s wholly owned subsidiary (the “Loan Parties”) entered into a Cooperation Agreement (the “Cooperation Agreement”) with Metropolitan Partners Group Administration, LLC, the administrative, payment and collateral agent (the “Agent”) under the Credit Agreement, dated as of September 21, 2022 (as amended, the “Credit Agreement”), Metropolitan Levered Partners Fund VII, LP, Metropolitan Partners Fund VII, LP, Metropolitan Offshore Partners Fund VII, LP and CEOF Holdings LP (collectively, the “Lenders”), and certain significant stockholders.

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.95

Presto Automation Inc. entered into May Note with Remus Capital Series B II, L.P valued at Convertible subordinated note in principal amount of $1,500,000; convertible into 10,714,286 shares (effective 2024-05-16).

Action: entry
Agreement: notes offering
Counterparty: Remus Capital Series B II, L.P
Value: Convertible subordinated note in principal amount of $1,500,000; convertible into 10,714,286 shares
Effective: 2024-05-16

Exact text from the filing

On May 16, 2024, Presto Automation Inc. (the “Company” or “we”) issued to Remus Capital Series B II, L.P, an entity controlled by Krishna Gupta, a member of our Board of Directors, a subordinated convertible note in the principal amount of $1,500,000 (the “May Note”) in consideration for a cash investment of $1,500,000 from Remus Capital.

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290 material agreements filed in the last 30 days. Browse all material agreements →

Source: SEC EDGAR

accession 0001104659-24-062373

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