ConnectM Tech Solutions: Deal Termination & Acquisition Completion

TL;DR

ConnectM terminated a deal, closed an acquisition, and might get delisted. Big changes ahead.

AI Summary

ConnectM Technology Solutions, Inc. announced on July 12, 2024, the termination of a material definitive agreement and the completion of an acquisition. The company also provided notice of potential delisting or failure to meet continued listing rules, indicating a significant shift in its operational and financial status.

Why It Matters

This filing signals significant corporate restructuring and potential challenges with stock exchange listing requirements for ConnectM Technology Solutions, Inc.

Risk Assessment

Risk Level: high — The filing indicates potential delisting and material changes, suggesting significant financial or operational instability.

Key Players & Entities

• ConnectM Technology Solutions, Inc. (company) — Registrant
• Monterey Capital Acquisition Corp (company) — Former company name
• 20240712 (date) — Date of report period

FAQ

Key Financial Figures

• $0.0001 — ch registered Common stock, par value $0.0001 per share CNTM The Nasdaq Global Ma
• $11.50 — Common Stock with an exercise price of $11.50 per share (the "Public Warrants") on th

Filing Documents

• tm2418949d1_8k.htm (8-K) — 296KB
• tm2418949d1_ex3-1.htm (EX-3.1) — 60KB
• tm2418949d1_ex3-2.htm (EX-3.2) — 145KB
• tm2418949d1_ex4-1.htm (EX-4.1) — 5KB
• tm2418949d1_ex10-1.htm (EX-10.1) — 73KB
• tm2418949d1_ex10-2.htm (EX-10.2) — 211KB
• tm2418949d1_ex10-3.htm (EX-10.3) — 88KB
• tm2418949d1_ex10-4.htm (EX-10.4) — 138KB
• tm2418949d1_ex10-21.htm (EX-10.21) — 25KB
• tm2418949d1_ex10-45.htm (EX-10.45) — 21KB
• tm2418949d1_ex10-46.htm (EX-10.46) — 21KB
• tm2418949d1_ex10-47.htm (EX-10.47) — 23KB
• tm2418949d1_ex10-48.htm (EX-10.48) — 23KB
• tm2418949d1_ex10-49.htm (EX-10.49) — 23KB
• tm2418949d1_ex10-50.htm (EX-10.50) — 23KB
• tm2418949d1_ex10-51.htm (EX-10.51) — 22KB
• tm2418949d1_ex10-52.htm (EX-10.52) — 22KB
• tm2418949d1_ex10-53.htm (EX-10.53) — 22KB
• tm2418949d1_ex10-54.htm (EX-10.54) — 21KB
• tm2418949d1_ex10-55.htm (EX-10.55) — 22KB
• tm2418949d1_ex10-58.htm (EX-10.58) — 48KB
• tm2418949d1_ex10-59.htm (EX-10.59) — 39KB
• tm2418949d1_ex10-60.htm (EX-10.60) — 23KB
• tm2418949d1_ex10-61.htm (EX-10.61) — 23KB
• tm2418949d1_ex10-62.htm (EX-10.62) — 23KB
• tm2418949d1_ex10-63.htm (EX-10.63) — 22KB
• tm2418949d1_ex21-1.htm (EX-21.1) — 14KB
• tm2418949d1_ex99-1.htm (EX-99.1) — 494KB
• tm2418949d1_ex99-2.htm (EX-99.2) — 350KB
• tm2418949d1_ex99-3.htm (EX-99.3) — 297KB
• tm2418949d1_ex99-4.htm (EX-99.4) — 11KB
• tm2418949d1_ex4-1img001.jpg (GRAPHIC) — 310KB
• tm2418949d1_ex4-1img002.jpg (GRAPHIC) — 173KB
• tm2419744d2_424b5img003.jpg (GRAPHIC) — 13KB
• 0001104659-24-080823.txt ( ) — 3987KB
• cntm-20240712.xsd (EX-101.SCH) — 3KB
• cntm-20240712_def.xml (EX-101.DEF) — 26KB
• cntm-20240712_lab.xml (EX-101.LAB) — 36KB
• cntm-20240712_pre.xml (EX-101.PRE) — 25KB
• tm2418949d1_8k_htm.xml (XML) — 5KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. Indemnification Agreements On the Closing Date, the Company entered into indemnification agreements with each of its directors and executive officers. These indemnification agreements provide the directors and executive officers with certain contractual rights to indemnification and advancement for certain expenses, including reasonable attorneys' fees, judgments, fines and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of their services as one of the Company's or an Affiliate of the Company's (as defined in the applicable indemnification agreement) directors or executive officers or as a director or executive officer of any other company or enterprise to which the person provides services at the request of the Company. The foregoing description of the indemnification agreements is qualified in its entirety by the full text of the form of indemnification agreement, a copy of which is filed as Exhibit 10.1 and incorporated herein by reference. A&R Registration Rights Agreement On the Closing Date, the Company entered into that certain Amended and Restated Registration Rights Agreement (the "A&R Registration Rights Agreement") with Monterrey Acquisition Sponsor, LLC (the "Sponsor"), certain prior stockholders of MCAC, certain stockholders of Legacy ConnectM, the Company's officers, directors and holders of 10% or more of the Common Stock (all such counterparties, collectively, the "Reg Rights Holders"). The A&R Registration Rights Agreement amended and restated the Company's Registration Rights Agreement dated May 10, 2022 (the "IPO Registration Rights Agreement"). Pursuant to the A&R Registration Rights Agreement, the Company will, within 30 days after the Closing, file with the SEC (at the Company's sole cost and expense) a registration statement registering the resale of certain securities held by or issuable to the Reg Rights Holders (the "Resale R

02 Termination of Material Definitive Agreement

Item 1.02 Termination of Material Definitive Agreement. Effective as of the Closing, the parties to the IPO Registration Rights Agreement agreed to terminate the IPO Registration Rights Agreement and enter into the A&R Registration Rights Agreement. The information set forth in the "Introductory Note" and Item 1.01 is incorporated herein by reference.

01 Completion of Acquisition or Disposition of Assets

Item 2.01 Completion of Acquisition or Disposition of Assets. The disclosure set forth in the "Introductory Note" above is incorporated herein by reference into this Item 2.01. FORM 10 INFORMATION

01(f) of Form 8-K states that

Item 2.01(f) of Form 8-K states that if the predecessor registrant was a shell company, as the Company was immediately before the business combination, then the registrant must disclose the information that would be required if the registrant were filing a general form for registration of securities on Form 10. Accordingly, the Company is providing the information below that would be included in a Form 10 if it were to file a Form 10. Please note that the information provided below relates to the combined company after the consummation of the business combination unless otherwise specifically indicated or the context otherwise requires. Cautionary Note Regarding Forward-Looking Statements This Current Report on Form 8-K and the documents incorporated by reference herein contain forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). We have based these forward-looking statements on our current expectations and projections about future events. All statements, other than statements of present or historical fact included in this Current Report on Form 8-K and the documents incorporated by reference herein, regarding our future financial performance and our strategy, expansion plans, future operations, future operating results, estimated revenues, losses, projected costs, prospects, plans and objectives of management are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "should," "could," "would," "expect," "plan," "anticipate," "intend," "believe," "estimate," "continue," "project" or the negative of such terms or other similar expressions. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, lev

Risk Factors

Risk Factors The risks associated with the Company's business are described in the Proxy Statement/Prospectus in the section entitled "Risk Factors" of the Proxy Statement/Prospectus, which is incorporated herein by reference. Historical Audited Financial Information The historical audited condensed financial statements of Legacy ConnectM as of and for the years ended December 31, 2023 and December 31, 2022 and the related notes are included in the Proxy Statement/Prospectus beginning on page F-54 and are incorporated herein by reference. Unaudited Condensed Financial Statements The unaudited condensed financial statements as of March 31, 2024 and for the three months ended March 31, 2024 and 2023 of Legacy ConnectM set forth in Exhibit 99.1 hereto are incorporated herein by reference and have been prepared in accordance with U.S. generally accepted accounting principles and pursuant to the regulations of the SEC. The unaudited financial information reflects, in the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company's financial position, results of operations and cash flows for the periods indicated. The results reported for the interim period presented are not necessarily indicative of results that may be expected for the full year. These unaudited condensed financial statements should be read in conjunction with the historical audited condensed financial statements of Legacy ConnectM as of and for the years ended December 31, 2023 and December 31, 2022 and the related notes included in the Proxy Statement/Prospectus beginning on Page F-54 and the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations of ConnectM" set forth in the Proxy Statement/Prospectus, each of which is incorporated by reference elsewhere in this Current Report on Form 8-K. Unaudited Pro Forma Condensed Combined Financial Information The unaudit

Management's Discussion and Analysis of Financial Condition

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's discussion and analysis of

Management's discussion and analysis of the financial condition and results of operations of Legacy ConnectM prior to the business combination is set forth in Exhibit 99.3 hereto, which is incorporated herein by reference.

Security Ownership of Certain Beneficial Owners and Management

Security Ownership of Certain Beneficial Owners and Management The following table sets forth information known to the Company regarding the beneficial ownership of Common Stock as of the Closing Date by: each person known to the Company to be the beneficial owner of more than 5% of the outstanding Common Stock; each of the Company's named executive officers and directors; and all of the executive officers and directors of the Company as a group. Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security, including options and warrants that are currently exercisable or exercisable within 60 days. Common Stock issuable upon exercise of options and warrants currently exercisable within 60 days are deemed outstanding solely for purposes of calculating the percentage of total voting power of the beneficial owner thereof. Unless otherwise indicated, the Company believes that each beneficial owner named in the table below has the sole voting and investment power with respect to all shares of Common Stock beneficially owned by such beneficial owner and the business address of each of the following entities or individuals is 2 Mount Royal Avenue, Suite 550, Marlborough, Massachusetts 01752. 7 Name of Beneficial Owner Common Stock Beneficially Owned Percentage of Common Stock Beneficially Owned Greater than Five Percent Holders Bhaskar Panigrahi (1) 3,968,145 18.8 % Win-Light, Capital, Co. 1,995,126 9.4 % Person and entities affiliated with Monterrey Acquisition Sponsor, LLC (2) 5,415,000 21.7 % Entities affiliated with Meteora Special Opportunity Fund (3) 3,288,466 15.6 % Directors and Named Executive Officers Bala Padmakumar (2) 5,415,000 21.7 % Bhaskar Panigrahi (1) 3,968,145 18.8 % Girish Subramanya 431,775 2.0 % Kevin Stateham (4) 24,910 * Mah

Executive Compensation

Executive Compensation Information with respect to the compensation of the named executive officers of the Company is set forth in the Proxy Statement/Prospectus in the section entitled "ConnectM's Executive and Director Compensation" of the Proxy Statement/Prospectus, and that information is incorporated herein by reference. Director Compensation A description of the compensation of the board of directors of Legacy ConnectM before the consummation of the business combination is set forth in the Proxy Statement/Prospectus section entitled "ConnectM's Executive and Director Compensation—Director Compensation" of the Proxy Statement/Prospectus, and that information is incorporated herein by reference. A description of the compensation of the Board after the consummation of the business combination is set forth under Item 5.02 of this Current Report on Form 8-K and is incorporated herein by reference. Certain Relationships and Related Party Transactions Certain relationships and related party transactions of the Company and Legacy ConnectM are described in the Proxy Statement/Prospectus in the section entitled "Certain Relationships and Related Party Transactions" of the Proxy Statement/Prospectus, which is incorporated herein by reference.

Legal Proceedings

Legal Proceedings From time to time, we may become involved in litigation or other legal proceedings. Reference is made to the disclosure regarding legal proceedings in the section of the Proxy Statement/Prospectus entitled "Business of ConnectM—Legal Proceedings" and that information is incorporated herein by reference. Market Price of and Dividends on the Registrant's Common Equity and Related Stockholder Matters The information set forth in the section of the Proxy Statement/Prospectus entitled "Trading Market and Dividends" is incorporated herein by reference with the exception of the information under "Combined Company—Nasdaq Stock Market Listing." 10 MCAC's Class A Common Stock, Warrants, units (consisting of one share of Class A Common Stock, one warrant and one right to receive one-tenth (1/10) of one share of MCAC Class A Common Stock, the "Units") and Rights were historically quoted on the Nasdaq Global Market under the symbols "MCAC," "MCACW," "MCACU" and "MCACR" respectively. In connection with the Closing, the Rights converted into an aggregate of 920,000 shares of Common Stock and no longer trade as a security and any remaining Units automatically separated into the component securities and, as a result, no longer trade as a separate security. On July 15, 2024, the Common Stock began trading on the Nasdaq Global Market under the new trading symbol "CNTM." As of the Closing Date, there were 104 record holders of ConnectM Common Stock. As of the Closing Date, there were 21,124,056 shares of Common Stock outstanding. Equity Compensation Plan Information The following table provides certain information about Common Stock that may be issued under our existing equity compensation plans. As of the Closing Date, there were 473,922 shares of Common Stock authorized for issuance under the ConnectM Technology Solutions, Inc. 2019 Equity Incentive Plan (the "2019 Plan") which our stockholders approved on March 22, 2019. As of the Closing Date, there wer

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View this 8-K filing on SEC EDGAR