0001353538FALSE00013535382024-07-022024-07-02

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): July 2, 2024

Appgate, Inc.
(Exact name of registrant as specified in its charter)

Delaware000-5277620-3547231
(State or other jurisdiction
 of incorporation) 		(Commission File Number) (I.R.S. Employer
 Identification)

2 Alhambra Plaza, Suite PH-1-B, Coral Gables, FL 33134
(Address of principal executive offices) (Zip Code)

(866) 524-4782
(Registrant’s telephone number, including area code)


(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):

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d -2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e -4(c))

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

Title of each class Trading Symbol(s) Name of each exchange on which registered
N/A N/A N/A

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. ☐

1

As previously disclosed, on May 6, 2024, Appgate, Inc., a Delaware corporation (“Appgate” or the “Company”) and certain of its direct and indirect subsidiaries (collectively, the “Debtors”) filed voluntary petitions for relief (the “Chapter 11 Cases”) under Chapter 11 of the United States Bankruptcy Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). On June 17, 2024, the Debtors filed the Second Amended Joint Prepackaged Plan of Reorganization of Appgate, Inc. and its Debtor Subsidiaries Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 150] (as may be amended, supplemented, or modified from time to time, the “Plan”) with the Bankruptcy Court. On June 18, 2024, the Bankruptcy Code confirmed the Plan and entered an Order (I) Approving the Disclosure Statement For, and Confirming, the Second Amended Joint Prepackaged Plan of Reorganization of Appgate, Inc. and its Debtor Subsidiaries Pursuant to Chapter 11 of the Bankruptcy Code and (II) Granting Related Relief [Docket No. 159] (the “Confirmation Order”). Capitalized terms used but not specifically defined herein have the meanings ascribed to them in the Plan. The Plan became effective on July 2, 2024 (the “Effective Date”).

Item 1.02 Termination of a Material Definitive Agreement.

Equity Interests

In accordance with the Plan, on the Effective Date, all shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), issued and outstanding immediately prior to the Effective Date, and any rights of any holder in respect thereof, were deemed cancelled, discharged, extinguished, and of no further force or effect, without consideration and without value. Holders of such shares of Common Stock will not receive distributions on account of their Equity Interests in Appgate, and Appgate Inc. will be dissolved as soon as reasonably practicable following the Effective Date in accordance with the terms of the Restructuring Transactions Memorandum.

Prepetition Indebtedness

Pursuant to the Plan, on the Effective Date, the obligations of the Debtors under the following agreements were cancelled, subject to limitations as set forth in Article IV.H of the Plan:

•Amended and Restated Note Purchase Agreement, dated June 9, 2023 (as amended, restated, supplemented, or otherwise modified from time to time consistent with the terms thereof), by and among Appgate Cybersecurity, Inc. as issuer, Appgate, Inc., as parent, the guarantors party thereto, Magnetar Financial LLC, as representative of the holders, and U.S. Bank Trust Company, National Association, as collateral agent.

•Amended and Restated Note Issuance Agreement, dated June 9, 2023 (as amended, restated, supplemented, or otherwise modified from time to time consistent with the terms thereof), by and among Appgate Cybersecurity, Inc. as issuer, Appgate, Inc., as parent, the guarantors party thereto, Magnetar Financial LLC, as representative of the holders, and U.S. Bank Trust Company, National Association, as collateral agent.

•Note Purchase Agreement, dated July 20, 2023 (as amended, restated, supplemented, or otherwise modified from time to time consistent with the terms thereof), by and among Appgate Cybersecurity, Inc. as issuer, Appgate, Inc., as parent, the guarantors party thereto, and Appgate Funding, LLC, as representative of the holders and collateral agent.

•Note Issuance Agreement, dated July 20, 2023 (as amended, restated, supplemented, or otherwise modified from time to time consistent with the terms thereof), by and among Appgate Cybersecurity, Inc. as issuer, Appgate, Inc., as parent, the guarantors party thereto, and Appgate Funding, LLC, as representative of the holders and collateral agent.

•Amended and Restated Revolving Credit Agreement, dated June 9, 2023 (as amended, restated, supplemented, or otherwise modified from time to time consistent with the terms thereof), by and among Appgate Cybersecurity, Inc., as borrower, Appgate, Inc. as parent, the guarantors party thereto, and SIS Holdings, L.P. as lender.

Item 1.03 Bankruptcy or Receivership.

The Plan became effective on July 2, 2024 (the “Effective Date”) when the Company filed a Notice of (I) Entry of an Order Approving the Disclosure Statement For, and Confirming, the Second Amended Joint Prepackaged Plan of Reorganization of Appgate, Inc. and its Debtor Subsidiaries Pursuant to Chapter 11 of the Bankruptcy Code and (II) Occurrence of Effective Date (the “Notice of Effective Date”) with the Bankruptcy Court. A copy of the Notice of Effective Date is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

2

The foregoing description is a summary of the material terms of the Notice of Effective Date, does not purport to be complete, and is qualified in its entirety by reference to the full text of the Notice of Effective Date filed as Exhibit 99.1 to this Current Report on Form 8-K.

Item 3.03 Material Modification to the Rights of Security Holders.

The information set forth under Item 1.02 of this Current Report on Form 8-K is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

On July 2, 2024, the Company issued a press release in connection with the effectiveness of the Plan. A copy of the press release is attached to this Current Report as Exhibit 99.2 and is incorporated herein by reference.

The information contained in this Item 7.01 shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of such section, and shall not be deemed to be incorporated by reference into any of the Company’s filings under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and regardless of any general incorporation language in such filings, except to the extent expressly set forth by specific reference in such a filing.

Item 8.01 Other Events.

In conjunction with its emergence from bankruptcy, the Company filed a post-effective amendment to the Registration Statement on Form S-8 with the U.S. Securities and Exchange Commission (the “SEC”). After its emergence, the Company intends to file a Form 15 with the SEC to deregister the Company’s common stock pursuant to Rule 12g-4(a)(1) under the Securities Act.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.Description
Notice of (I) Entry of an Order Approving the Disclosure Statement For, and Confirming, the Second Amended Joint Prepackaged Plan of Reorganization of Appgate, Inc. and its Debtor Subsidiaries Pursuant to Chapter 11 of the Bankruptcy Code and (II) Occurrence of Effective Date.
Press Release issued by Appgate, Inc. on July 3, 2024.
104Cover Page Interactive Data File


SIGNATURES

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.

Dated: July 3, 2024Appgate, Inc.
By: /s/ Leo Taddeo
Name: Leo Taddeo
Title: Chief Executive Officer and President
3
IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE ) In re: ) Chapter 11 ) APPGATE, INC., et al.,1 ) Case No. 24-10956 (CTG) ) Debtors. ) (Jointly Administered) ) ) Re: Docket Nos. 16, 150, & 159 NOTICE OF (I) ENTRY OF AN ORDER APPROVING THE DISCLOSURE STATEMENT FOR, AND CONFIRMING, THE AMENDED JOINT PREPACKAGED PLAN OF REORGANIZATION OF APPGATE, INC. AND ITS DEBTOR SUBSIDIARIES PURSUANT TO CHAPTER 11 OF THE BANKRUPTCY CODE AND (II) OCCURRENCE OF EFFECTIVE DATE PLEASE TAKE NOTICE that on June 18, 2024, the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) entered an Order Approving the Disclosure Statement for, and Confirming, the Second Amended Joint Prepackaged Plan of Reorganization of Appgate, Inc. and its Debtor Subsidiaries Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 159] (the “Confirmation Order”) confirming the Second Amended Joint Prepackaged Plan of Reorganization of Appgate, Inc. and its Debtor Subsidiaries Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 150] (the “Plan”) and approving the Disclosure Statement Relating to the Joint Prepackaged Plan of Reorganization of Appgate, Inc. and Its Debtor Subsidiaries Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 16] (the “Disclosure Statement”) of the above-captioned debtors and debtors in possession (collectively, the “Debtors”).2 PLEASE TAKE FURTHER NOTICE that the Effective Date of the Plan occurred on July 2, 2024. Each of the conditions precedent to consummation of the Plan enumerated in Article IX of the Plan has been satisfied or waived in accordance with the Plan and the Confirmation Order. 1 The Debtors in these Chapter 11 Cases, along with the last four digits of each Debtor’s federal tax identification number, are: Appgate, Inc. (7231); Appgate Cybersecurity, Inc. (5215); Cryptzone Worldwide, Inc. (3539); Cryptzone International Holdings Inc. (6133); Cryptzone North America Inc. (6777); Immunity, Inc. (3955); Immunity Federal Services, LLC (9722); Immunity Products, LLC (9570); Immunity Services, LLC (9647); Easy Solutions Enterprises Corp. (1954); Catbird Networks, Inc. (6028); and Easy Solutions, Inc. (0401). The location of the Debtors’ service address is: 2 Alhambra Plaza, Suite PH–1–B, Coral Gables, Florida 33134. 2 Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Confirmation Order or the Plan, as applicable.

 
PLEASE TAKE FURTHER NOTICE that the Bankruptcy Court has approved certain discharge, release, exculpation, injunction, and related provisions contained in Article VIII of the Plan. PLEASE TAKE FURTHER NOTICE that the Confirmation Order, the Plan, and copies of all documents Filed in these Chapter 11 Cases are available free of charge by visiting https://www.donlinrecano.com/Clients/apg or by calling the Debtors’ restructuring information line at (877) 896-3192 (toll free) or +1 (212) 771-1128 (international). You may also obtain copies of any pleadings filed in these chapter 11 cases for a fee via PACER at: http://www.deb.uscourts.gov. PLEASE TAKE FURTHER NOTICE that the terms of the Confirmation Order and the Plan (which, for the avoidance of doubt, includes the Plan Supplement and all exhibits and documents related thereto) are binding upon the Debtors, the Reorganized Debtors, and any and all Holders of Claims or Equity Interests (irrespective of whether Holders of such Claims or Equity Interests are deemed to have accepted the Plan), all Entities that are parties to or are subject to the settlements, compromises, releases, discharges, and injunctions described in the Plan or herein, each Entity acquiring property under the Plan, and any and all non-Debtor parties to Executory Contracts and Unexpired Leases with the Debtors. PLEASE TAKE FURTHER NOTICE that, in accordance with Article IV.B of the Plan, on the Effective Date, certain of the Debtors and other applicable parties engaged in a series of Restructuring Transactions as set forth in the Restructuring Transactions Memorandum attached to the Plan Supplement as Exhibit G. PLEASE TAKE FURTHER NOTICE THAT all requests for payment of Professional Fee Claims for services rendered and reimbursement of expenses incurred prior to the Confirmation Date must be filed no later than 45 days after the Effective Date. The Bankruptcy Court shall determine the Allowed amounts of such Professional Fee Claims after notice and a hearing in accordance with the procedures established by the Bankruptcy Court. [Remainder of page intentionally left blank.]

 
Dated: July 2, 2024 /s/ Patrick J. Reilly Wilmington, Delaware Patrick J. Reilley (No. 4451) Stacy L. Newman (No. 5044) Jack M. Dougherty (No. 6784) Michael E. Fitzpatrick (No. 6797) COLE SCHOTZ P.C. 500 Delaware Avenue, Suite 1410 Wilmington, Delaware 19801 Telephone: (302) 652-3131 Facsimile: (302) 652-3117 Email: preilley@coleschotz.com snewman@coleschotz.com jdougherty@coleschotz.com mfitzpatrick@colescotz.com -and- Edward O. Sassower, P.C. (admitted pro hac vice) Christopher Marcus, P.C. (admitted pro hac vice) Derek I. Hunter (admitted pro hac vice) KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 Email: edward.sassower@kirkland.com Email: christopher.marcus@kirkland.com Email: derek.hunter@kirkland.com Co-Counsel for the Debtors and Debtors in Possession

 
Appgate Successfully Completes Recapitalization and Embarks on Next Phase of Growth Company emerges debt free from recapitalization, launches new malware analysis service and releases enhanced version of its Universal Zero Trust Network Access Solution MIAMI (JULY 3, 2024) -- Appgate, the secure access company, today announced the successful completion of its recapitalization process and transition to a private company. Post emergence, the company has significantly strengthened its financial position with no issued corporate debt outstanding and enhanced its capital reserves to support and expand operations. As a result of this transition, certain of Appgate’s existing lead investors have become the majority equity owners of the company. Building on this solid financial foundation as a private entity, Appgate has secured additional equity financing from Magnetar, a leading alternative investment firm with $15B1 in assets. This investment is an important element of Appgate’s broader financial restructuring to further fortify the company as it seeks to strengthen its platform and drive sustainable growth. A leading provider of Universal Zero Trust Network Access (ZTNA) and Online Fraud Protection, Appgate maintained a strong customer experience throughout the company’s transition to a private entity and continued to see growing demand for its products. Appgate won significant new business during the recapitalization process, including the finalization of a meaningful deal with the Department of Defense. The company also recently released Appgate SDP 6.3, the latest version of its award-winning Universal Zero Trust Network Access (ZTNA) solution, which enables network transformation by hardening an organization’s perimeter and securing its most valuable assets, while reducing costs. The new version includes an AI-based risk engine and maximizes resiliency, speed and performance to create a more agile, efficient and secure network, improving business continuity, security and performance. Additionally, the company recently launched a new malware analysis service, aimed at helping customers mitigate cyberthreats by identifying and neutralizing malicious software. “We are pleased to have completed our recapitalization to strengthen our balance sheet and enhance our financial flexibility as we seek to drive increased value for all Appgate stakeholders,” said Leo Taddeo, CEO and President, Appgate. “Emerging from this process, and on the heels of two consecutive quarters of strong growth, we are moving forward with momentum and a fortified capital structure that supports our ability to capitalize on the growing market and increased demand for cybersecurity solutions that meet the needs of today’s largest enterprises and government agencies.” Mr. Taddeo continued, “Through this recapitalization, Appgate is now well positioned to increase investments in new technologies, enhance the customer experience and pursue new customer 1 As of March 31, 2024.

 
acquisition in our pursuit of profitable growth. We look forward to deepening our partnership with our long-term investors to strengthen the company for the future and drive continued innovation in securing and protecting organizations’ most valuable assets and applications.” Kirkland & Ellis LLP served as legal advisor and Portage Point Partners, LLC served as investment banker and financial advisor to the company. Willkie Farr & Gallagher LLP served as legal advisor and Uzzi & Lall and M3 Partners served as financial advisors to certain Appgate investors. About Appgate Appgate secures and protects an organization's most valuable assets and applications. Appgate is the market leader in Zero Trust Network Access (ZTNA) and online fraud protection. Appgate products include Appgate SDP for Universal ZTNA and 360 Fraud Protection. Appgate services include threat advisory analysis and ZTNA implementation. Appgate safeguards enterprises and government agencies worldwide. Learn more at appgate.com. Media Contacts ZAG Communications for Appgate appgate@zagcommunications.com

 
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Jul. 02, 2024
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