Mitesco (MITI) 8-KEntry into a Material Definitive Agreement

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 20, 2024

MITESCO, INC.

(Exact Name of Registrant as Specified in Charter)

(844) 383-8689

(Registrant's telephone number, including area code)

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:

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or 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. ☐

Restructuring plans and elimination of obligations

The Company is continuing an effort to restructure its obligations including all debts, notes, accounts payable and certain of its previously issued preferred shares. As noted below, the Company has now converted over $12 million of its obligations into restricted common stock at a price of $4.00 per share, and it is exchanging over $13 million of its senior securities into a newly created, non-interest bearing preferred stock. All of these obligations were related to its clinic business which was discontinued in FY2022.

This is an update from the information contained in a Form 8-K Filing dated October 24, 2024. The link for the filing is here:

https://www.sec.gov/ix?doc=/Archives/edgar/data/0000802257/000118518524001041/mitesco20241024_8k.htm.

Since September 28, 2024, the Company has entered into Obligation Exchange Agreements pursuant to which it has now converted over $12 million of its obligations, including accounts payable, notes and certain of its previously issued preferred shares, into restricted common stock using a price per share of $4.00, resulting in the aggregate issuance of roughly 2.5 million shares of restricted common stock.

Further, as of November 22, 2024, the Company has authorized the issuance of 534,835 shares of its newly created Series A Amortizing Convertible Preferred Stock (the “Series A Shares” or “Series A Preferred Stock”), whose stated value is $25.00 per share to five (5) of its accredited institutional investors in exchange for the cancellation of $13,370,883 million of its Series D and Series F Preferred shares.

As disclosed previously, the Series A Shares may be converted into shares of common stock by dividing the stated value by $4.00 (the “Conversion Price”). The Series A Shares may be converted at the option of the holder at any time, or mandatorily by the Company if certain conditions set forth in the certificate of designation (filed previously) are met. As stipulated in the certificate of designation, unless converted, shares of Series A Preferred Stock will be redeemed by the Company, using common stock, or cash, 1/36^th of the remaining amounts monthly beginning in January 2025. The cash redemption shall be at 105% of the original price of the Series A Preferred Stock (as adjusted) and common stock redemption shall be at a 10% discount to the average of the five lowest closing prices over a 30 trading day period.  The Company intends to accrue the redemption shares monthly and issue any shares to be used thereunder quarterly to reduce its expense.

As a result of its terms, timeframe and other factors including regulatory and market factors outside of the control of the Company, the risk to the holders of Series A Preferred Stock is deemed to be significant, and as such its issuance is limited to only accredited institutional entities.

Following the exchange transactions noted above, as of the date of this filing, there currently remain outstanding only seven (7) historical senior securities and notes that remain un-exchanged for common stock. Five (5) of those are held by former officers, directors and related parties of the Company. These former insider holdings include: (i) a single issuance of its Series D Preferred shares whose value at September 30, 2024 was approximately $30,000; (ii) one (1) issuance of its or Series F Preferred shares whose value at September 30, 2024 was approximately $90,000; and (iii) five (5) promissory notes whose aggregate value is around $964,000, including a single institutional investor which accounts for approximately $720,000 of the total.

The Company continues to negotiate restructuring of these instruments with the respective holders and expects that all will convert under the same terms as the previous holders, given there is no path to liquidity under the structure found in the existing holdings in the foreseeable future.

Furthermore, all participants in its restructuring activities have agreed to the cancelation of their warrants.

Lastly, the Company has agreed to use its commercially reasonable efforts to file a registration statement to register the resale of common stock issued in exchange for its obligations and the shares which may be issued in the conversion or redemption of Series A Preferred stock, within 120 days from the date of execution of the agreements. Further, the Company shall use its commercially reasonable efforts to cause the registration statement to be declared effective as promptly as practicable following the filing of the same. There can be no assurance that the regulatory process will be completed timely, or that the shares will ultimately become registered. Nor can there be any assurance that there will be a market for the common stock of price or volume sufficient to meet the needs of the holders for liquidity in the markets.

The Company expects to recognize a substantial gain upon extinguishment of the outstanding debt described in this Form 8-K (accounts payable and promissory notes) upon its conversion into common stock, which treatment will be subject to final review by our auditors.

A copy of the forms of the Obligation Exchange Agreement and Share Exchange Agreement is filed as Exhibit 10.1 and 10.2 respectively to this Current Report on Form 8-K and a letter that accompanied the exchange agreements as Exhibit 99.1, each incorporated herein by reference.

The disclosure made under Item 1.01 and Item 5.02 in this Form 8-K is incorporated herein by reference.  In connection with the debt restructuring, the Company completed the issuance of shares of common stock to a combination of accredited and non-accredited investors in a transaction not involving a public offering pursuant to section 4(a)(2) of the United States Securities Act of 1933, as amended (the “Securities Act”). In connection with the issuance of compensation to directors, the Company relied on Regulation D/section 4(a)(2) of the Securities Act to issue shares of common and preferred stock. 

Restructuring Plans

The Company is in discussions with various of its institutional investors regarding its restructuring plans and expects to make further progress over the next few weeks and months. The goal is to have substantially all of its payables, notes and other obligations extinguished by the end of the fiscal year, December 31, 2024. While it has received positive and supportive feedback from those with whom it has discussed the plans, there can be no assurance that the restructuring will be successful, or that the current business activities will grow to a level that can support the costs associated with being a public company.

Forward-Looking Statements

This Form 8-K contains forward-looking statements. You can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “proposed,” “intended,” or “continue” or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future events or state other “forward-looking” information. There may be events in the future that we are not able to accurately predict or control. The forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in such forward-looking statements. We cannot give any guarantee that these plans, intentions, or expectations will be achieved. All forward-looking statements involve risks and uncertainties, and actual results may differ materially from those discussed in the forward-looking statements as a result of various factors.

SIGNATURE

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.