false 0001017655 0001017655 2024-07-05 2024-07-05

 

 

FORM 8-K

 

 

Date of Report (Date of earliest event reported):  July 5, 2024

 

 

(Exact Name of Registrant as Specified in Charter)

 

 

 

Registrant’s telephone number, including area code: (617) 861-6050

 

(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):

 

 

 

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

 

Indicate by checkmark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) of Rule 12B-2 of the Securities Exchange act of 1934 (§240.12b-2 of this chapter).

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.  ☐

 

 

Item 1.01.         Entry Into a Material Definitive Agreement

 

Effective July 5, 2024, the Company entered into a financing arrangement to loan 5String Solutions, LLC, a Kansas limited liability company, up to $400,000 through December 31, 2025, not to exceed $250,000 in 2024. On July 5, 2024, the Company funded the 2024 installment of $250,000. The loan is secured by all assets of 5String Solutions. The Company is in a first lien position, together with subordinated noteholders in the event of a default, including a default due to insolvency. The loan carries a 12% interest rate and matures no later than April 30, 2027.

 

The Company is obligated, absent default, to convert the loan into 55% of outstanding membership interest units of 5String Solutions, and to purchase the remaining 45% of 5String Solutions units based on a valuation formula related to a five times valuation multiple less indebtedness, calculated at the time of the purchase. The Company may agree to loan additional funds in $50,000 installments prior to the required conversion for an additional 7% of the units of 5String Solutions. The projected purchase of the remaining unconverted units is expected to occur no later than April 30, 2027.

 

5String Solutions, LLC is a Kansas limited liability company that has assembled a coalition of carriers with capabilities to deliver local LTL, local parcel, hot shot, residential and white glove services, fulfillment, reverse logistics, pool distribution, zone-skipping. 5String Solutions advocates for last mile connectivity and helps companies electronically connect to existing networks.

 

 

Item 9.01.         Financial Statements and Exhibits.

 

 

(d)         Exhibits

 

10.1         $400,000 Convertible Promissory Note dated July 3, 2024 (executed July 5, 2024) by 5 String Solutions, LLC for the benefit of Paid, Inc.

 

10.2         Security Agreement dated July 3, 2024 by and among 5String Solutions, LLC (as debtor), Paid, Inc. (as secured party and collateral agent) and certain named subordinated creditors of debtor (as additional secured parties)

 

104          Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.