Velatel Global Comm (PINK:VELA)

WEB NEWS

Thursday, March 6, 2014

Deal Flow

Item 1.01     Entry into Material Definitive Agreements

Completion of Refinance for Acquisition of China Motion Telecom (HK), Ltd.


Newly Disclosed Information

On February 28, 2014, Xin Hua delivered to the Company a Deed of Release which acknowledged (i) payment in full of the remaining balance due under the Xin Hua Loan Agreement, (ii) release of the Shares and other collateral under the Share Charge, and (iii) termination of the Option Deed. A copy of the Deed of Release is attached as Exhibit 10.1 to this Form 8-K and is incorporated by this reference.

The proceeds paid to Xin Hua on various dates in late-February 2014 to secure the Deed of Release were comprised of US$918,000 advanced by AQC (in addition to amounts advanced by AQC described above), which AQC advanced pursuant to a preliminary agreement to enter into the promissory note and related agreements described below, and US$1,500,000 advanced by Tai Chun-ya pursuant to a Loan Agreement between Tai Chun-ya and Gulfstream also described below

In connection with the US$918,000 proceeds advanced by AQC, the Company and AQC entered into a Second Amended AQC Loan Agreement, which provides that in consideration of and subject to execution of the following instruments between AQC and CMMobile directly, all rights and obligations of the parties under the Original and First Amended AQC Loan Agreement shall be declared and deemed satisfied: (1) a Promissory Note, (2) a Security Agreement, and (3) a Warrant for purchase of CMMobile Shares. A copy of the Second Amended AQC Loan Agreement is attached as Exhibit 10.2 to this Form 8-K and is incorporated by this reference.

The new Promissory Note from CM Mobile to AQC is in the amount of US$2,863,000, representing the sum of all amounts previously advanced by AQC, plus interest accrued through the date of the Promissory Note on such amounts. The principal balance of the Promissory Note bears interest at 10% per annum, which increases to 20% in the event of any default. The total term of the Promissory Note is three years, with a final maturity date of March 3, 2017, subject to payment in cash of extension fees in three month intervals, each equal to 3% of the principal balance then due. The Promissory Note may be prepaid in whole or in part without penalty. In addition to standard provisions describing events of default, the filing of any voluntary or involuntary bankruptcy petition, appointment of receiver, or other extraordinary action to dissolve or liquidate the assets of the Company or Gulfstream, or writ for attachment of any of CMMobile’s stock, which proceeding is not dismissed within thirty days of filing, constitutes a default under the Promissory Note, as does any change of management control of the Company. For so long as there is any amount owing under the Promissory Note, AQC has the right to appoint one director of CMMobile, and certain major corporate events are subject to unanimous approval of all directors. A copy of the Promissory Note is attached as Exhibit 10.3 to this Form 8-K and is incorporated by this reference.

The Security Agreement grants AQC a security interest in all of CMMobile’s current and future assets, as security for repayment of the Promissory Note. In the event of default, AQC may take control of and sell any or all of the assets and apply the proceeds of such sale against the amount then owed under the Promissory Note. A copy of the Security Agreement is attached as Exhibit 10.4 to this Form 8-K and is incorporated by this reference.

The Warrant grants AQC the right to purchase 49% (on a fully diluted basis) of the Shares of CMMobile (Series A Warrant). The Warrant may be exercised in whole or in part from time to time until expiration on March 1, 2024 at an exercise price of $0.0001 per Share, subject to price adjustment in the event of future equity or other corporate events that would cause the number of Shares outstanding to change. AQC has the right to vote the number of Shares equal to 49% of the total outstanding Shares that are represented by the Warrant, as though the Warrant had been fully exercised. AQC has the option but not the obligation to partially exercise the Warrant for the number of Shares required to fulfill the prior option of StarHub Mobile Pte., Ltd to acquire up to 25% of the Shares (see Exhibit 10.1 to Form 8-K filed December 2, 2013, Cooperation Agreement between CMMobile and StarHub granting this option). The Warrant is subject to increase (Series B Warrant) upon any of the following events (each percentage described also on a fully diluted basis): (i) 1% for each extension fee described in the Promissory Note that is not timely paid, (ii) 10% in the event of a change of management control of the Company, and/or (iii) 10% in the event of filing of a voluntary or involuntary bankruptcy petition, appointment of receiver, or other extraordinary action to dissolve or liquidate the assets of the Company or Gulfstream, or a writ for attachment of any of CMMobile’s stock, which proceeding is not dismissed within thirty days of filing. AQC has the right to vote the Shares represented by the Series B Warrant only upon exercise of that portion of the Warrant. Exercise of the entire portion of the Warrant not previously exercised shall be deemed to have occurred automatically one day prior to the occurrence of any event described in sub-part (i) or (ii) above, without notice and with sixty (60) days grace period for AQC to pay the exercise price. A copy of the Warrant is attached as Exhibit 10.5 to this Form 8-K and is incorporated by this reference.

The Tai Chun-ya Loan Agreement calls for repayment of US$1,500,000, plus interest at 10% per annum on or before July 26, 2014. Tai Chun-ya has the option to accept repayment (including interest) in the form of 15% of the Shares of CMMobile. A copy of the Tai Chun-ya Loan Agreement is attached as Exhibit 10.6 to this Form 8-K and is incorporated by this reference.


Thursday, August 1, 2013

Legal Insights

Item 8.01 Other Events

On July 20, 2013, VelaTel Global Communications, Inc., a Nevada corporation and the Registrant responsible for filing this current Report on Form 8-K, together with its wholly owned subsidiary Gulfstream Capital Partners, Ltd., a Seychelles corporation (collectively “Company”) commenced an arbitration proceeding (“Arbitration”) against China Motion Telecom International Limited, China Motion Holdings Limited, and ChinaMotion InfoServices Limited (collectively “Respondents”) by filing a Notice of Arbitration with the Hong Kong International Arbitration Centre. The Arbitration relates to the stock purchase agreement and related transaction documents (collectively “SPA”) between the Company and the Respondents for the Company’s acquisition of 100% of the capital stock of China Motion Telecom (HK) Limited (“CMTHK”). The Company has previously disclosed the terms of the SPA, as amended from time to time prior to closing, by current Reports on SEC Form 8-K filed November 27, 2012, February 4, 2013, and March 8, 2013.

In the Notice of Arbitration, the Company alleges that Respondents have breached the SPA by interfering in the day-to-day management of CMTHK in various ways that exceed the limited oversight granted to Respondents pursuant to the terms of the SPA, including but not limited to: (a) delaying CMTHK’s processing of the Company’s invoices for technical services rendered to CMTHK, and (b) refusing to authorize CMTHK to process banking board resolutions approved by a majority of CMTHK’s directors to change signatory authority on CMTHK’s bank accounts.

The Company seeks the following relief in the Arbitration: (1) declaring Respondents have breached the SPA, (2) enjoining Respondents from future interference in the management of CMTHK, and (3) for recovery of the Company’s past and future damages caused by Respondents’ breach of the SPA. The Notice of Arbitration does not quantify the Company’s damages, but the Company alleges such damages may include (a) additional audit and legal fees associated with restating the Company’s past financial statements, (b) diminution in value of the Company’s equity or capital raising ability as a result of restating its past financial statements or inability to include the financial results of CMTHK in the Company’s future consolidated financial statements, (c) diminution in value of CMTHK’s equity, (d) harm to CMTHK’s business reputation, corporate opportunities, or potential concession opportunities, (e) other incidental and consequential damages, and (f) attorney fees and other costs and disbursements the Company incurs in prosecuting the Arbitration.

Pursuant to the Arbitration rules to which the Company and the Respondents agreed in the SPA, there are limitations on the right to publish or disclose any information regarding the Arbitration absent consent of all parties to the Arbitration. On August 1, 2013, the Company and Respondents mutually consented to disclosure of current or future information regarding the Arbitration that a party deems required or advisable in connection with its obligations as a company with publicly traded securities.

The Arbitration has just commenced and Respondents have not yet filed their Response to the Notice of Arbitration. The Company may disclose material developments regarding the Arbitration as they occur, in the Company’s quarterly and/or annual current Reports on SEC Forms 10-Q and 10-K, respectively.


Friday, June 14, 2013

Comments & Business Outlook

VELATEL GLOBAL COMMUNICATIONS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

 

    For the Three Months Ended March 31,  
    2013     2012  
                 
REVENUE   $ 1,423,605     $  
Cost of revenue     825,820        
Gross profit (loss)     597,785        
                 
OPERATING EXPENSES:                
Selling, general and administrative expenses     2,612,613       2,932,044  
Depreciation and amortization     76,048       141,800  
Total operating expenses     2,688,661       3,073,844  
                 
Net loss from operations     (2,090,876 )     (3,073,844 )
                 
OTHER INCOME (EXPENSES):                
Other income (expenses)     31,629       (4,709 )
Gain (loss) on settlement of debt     (3,401,263 )     2,275,201  
Gain (loss) on foreign currency transactions     (530 )     (4 )
Gain (loss) on change in fair value of debt derivative     (1,261,021 )     (55,950 )
Interest expense     (306,851 )     (655,529 )
Total other income (expense)     (4,938,036 )     1,559,009  
                 
Loss from continuing operations     (7,028,912 )     (1,514,835 )
                 
Discontinued operations:                
Income (loss) from operations of discontinued operation     195,676       (357,726 )
                 
Net loss     (6,833,236 )     (1,872,561 )
                 
Loss attributed to non controlling interest     106,999       17,886  
                 
NET LOSS ATTRIBUTABLE TO VELATEL GLOBAL COMMUNICATIONS, INC.   $ (6,726,237 )   $ (1,854,675 )
                 
Net loss per common share (basic and fully diluted) - continuing operations   $ (0.05 )   $ (0.21 )
Net income (loss) per common share (basic and fully diluted) - discontinued operations   $ 0.00     $ (0.05 )
Weighted average number of shares outstanding, basic and fully diluted     139,790,494       7,286,391  
                 
Comprehensive Loss:                
Net Loss   $ (6,833,236 )   $ (1,872,561 )
Foreign currency translation gain     3,715        
                 
Comprehensive Loss:     (6,829,521 )     (1,872,561 )
Comprehensive loss attributable to the non controlling interest     106,999       17,886  
Comprehensive loss attributable to Velatel Global Communications, Inc.   $ (6,722,522 )   $ (1,854,675 )

 

 

In its Current Report on SEC Form 10-Q, the Company disclosed existence of a default under the Promissory Note issued as part of the Company’s acquisition of China Motions Telecom (HK) Limited, for failure to pay the installment payment of HK$4,650,000 (US$600,000) principal only called for under the Note to be paid on or before May 31, 2013.

 

As of June 27, 2013, the default has been cured based on payment of the installment, and the holder of the Note has confirmed that the default no longer exists.


Friday, May 17, 2013

Comments & Business Outlook

VELATEL GLOBAL COMMUNICATIONS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS

YEARS ENDED DECEMBER 31, 2012 AND 2011

 

 

    2012     2011  
             
REVENUE   $ 1,877,285     $  
Cost of revenue     1,210,328       3,205  
Gross profit (loss)     666,957       (3,205 )
                 
OPERATING EXPENSES:                
Selling, general and administrative expenses     11,267,766       12,884,765  
Impairment of investments     3,919,000        
Impairment of property, plant and equipment     7,001,870        
Impairment of goodwill     273,048        
Depreciation and amortization     224,385       234,198  
Research and development costs     134,265       6,317,287  
Total operating expenses     22,820,334       19,436,250  
                 
Net loss from operations     (22,153,377 )     (19,439,455 )
                 
OTHER INCOME (EXPENSES):                
Other income (expenses)     82,997       48,103  
Gain (loss) on settlement of debt     (10,822,764 )      
Gain (loss)on foreign currency transactions     (3,853 )     (216 )
Gain (loss) on change in fair value of debt derivative     (4,039,616 )     (71,666 )
Interest expense     (1,375,843 )     (619,202 )
Total other income (expense)     (16,159,079 )     (642,981 )
                 
Loss from continuing operations     (38,312,456 )     (20,082,436 )
                 
Discontinued operations:                
Loss from operations of discontinued operation     (7,288,836 )     (1,710,242 )
                 
Net loss     (45,601,292 )     (21,792,678 )
                 
Loss attributed to non controlling interest     2,448,085       85,512  
                 
NET LOSS ATTRIBUTABLE TO VELATEL GLOBAL COMMUNICATIONS, INC.   $ (43,153,207 )   $ (21,707,166 )
                 
Net loss per common share (basic and fully diluted) - continuing operations   $ (1.27 )   $ (3.74 )
Net loss per common share (basic and fully diluted) - discontinued operations   $ (0.26 )   $ (0.32 )
Weighted average number of shares outstanding, basic and fully diluted     28,213,128       5,344,895  
                 
Comprehensive Loss:                
Net Loss   $ (45,601,292 )   $ (21,792,678 )
Foreign currency translation gain     (69,398 )      
                 
Comprehensive Loss:     (45,670,690 )     (21,792,678 )
Comprehensive loss attributable to the non controlling interest     2,448,085       85,512  
Comprehensive loss attributable to Velatel Global Communications, Inc.   $ (43,222,605 )   $ (21,707,166 )

Tuesday, December 18, 2012

Deal Flow

http://www.sec.gov/Archives/edgar/data/1357531/000101968712004548/velatel_8k.htmOn December 14, 2012, VelaTel Global Communications, Inc., a Nevada corporation and the Registrant responsible for filing this current Report on Form 8-K (“Company”), entered into a Stock Purchase Agreement (“SPA”) with Ironridge Technology Co., a division of Ironridge Global IV, Ltd. (collectively “Ironridge”), for the sale of 1,200 shares of convertible redeemable Series B Preferred Stock (“Preferred Shares”) at a price of $10,000 per Preferred Share, for a total purchase price of $12,000,000. The first Closing is scheduled to occur December 17, 2012 by direct wire transfer of $600,000 to the designated escrow holder under the Company’s stock purchase agreement to acquire China Motions Telecom (HK) Limited (disclosed on a Form 8-K filed November 27, 2012), as the down payment deposit for such acquisition. Each successive Closing shall occur on the first day of each calendar month, or sooner at the Company’s sole option, subject to fulfillment of designated equity conditions (“Equity Conditions”) as defined in the Certificate of Designations disclosed under Item 5.03. Ironridge is entitled to a one time non-refundable commitment fee of 60 Preferred Shares in consideration for providing the $12 million irrevocable funding commitment. A complete copy of the SPA is attached as Exhibit 10.1 to this Form 8-K, and is incorporated by this reference.

 Also on December 14, 2012, the Company filed a Certificate of Designations with the Nevada Secretary of State in order to fix the dividend, conversion, redemption, voting rights and other attributes of the Preferred Shares called for under the SPA. The Company may redeem, all or any portion of the Preferred Shares at a redemption price equal to $10,000 per Preferred Share, plus dividends accrued but unpaid, plus , in the event of an early redemption or conversion, an Embedded Derivative Liability, as defined in and as calculated pursuant to a formula more fully described in the Certificate of Designations. The Company or the holder of any Preferred Shares (each a “Holder”) may convert all or any portion of the Preferred Shares into shares of the Company’s Series A common stock (“Series A Shares”) at $10,000 per Preferred Share being converted, divided by the fixed conversion price of $0.20 per Series A Share; together with the sum of accrued dividends plus the Embedded Derivative Liability, divided by the closing bid price per Series A Share as determined on the date of conversion, valued at 81% of such closing bid price. The attributes of the Preferred Shares as set forth in the Certificate of Designations are more fully disclosed in Item 5.03. The information disclosed under Item 5.03 is incorporated into this Item 1.01 in its entirety. A complete copy of the Certificate of Designations is attached as Exhibit 3.1 to this Form 8-K, and is incorporated by this reference.  Full filing. 


Friday, September 21, 2012

Deal Flow

Item 3.02 Unregistered Sale of Equity Securities

 

Since its most recent Report filed on any of Forms 8-K, 10-K or 10-Q, VelaTel Global Communications, Inc., a Nevada corporation and the Registrant responsible for filing this current Report on Form 8-K (“Company”) has made sales of unregistered securities identified below, namely shares of the Company’s Series A common stock (“Series A Shares”) and shares of the Company’s Series B common stock (“Series B Shares”). This Form 8-K is being filed because the aggregate number of Series A Shares and Series B Shares sold exceeds five percent (5%) of the total number of Series A Shares and Series B Shares issued and outstanding as of the Company’s latest filed Report, on Form 8-K filed on September 14, 2012.

 

Series A Shares

 

On September 20, 2012, the Company issued 2,097,848 Series A Shares and 2,097,848 warrants to each of James Shaw, Steven O. Smith and Ann Stowell, for a total of 6,293,544 Shares and 6,293,544 warrants in partial payment of a line of credit promissory note of up to $1,052,631.50 in favor Weal Group, Inc. and partially assigned to James Shaw, Steven O. Smith and Ann Stowell. Each warrant gives the holder the right to purchase one Series A Shares at an exercise price of $0.0251 and with an exercise term of three years. This sale of Series A Shares resulted in a principal reduction of $144,731.79 in notes payable of the Company, and payment of accrued interest of $13,236.17.

 

Series B Shares

 

On September 20, 2012, the Company issued 8,000,000 Series B Shares to Colin Tay, the Company’s President. Each Series B Share has the right to cast ten votes for each action on which our shareholders have a right to vote, whereas each Series A Share has the right to cast one vote. The Company believes it is in its best interests to maintain management voting control of the Company, including avoidance of the expense of soliciting proxies for corporate actions requiring shareholder approval. Prior to this issuance, there were 2,000,000 Series B Shares issued and outstanding, all of which are beneficially owned or their voting rights controlled via proxies held by various members of the Company’s management team. The Company issued 8,000,000 additional Series B Shares to Colin Tay in order to maintain such management voting control, taking into account the number of Series A Shares currently issued and outstanding, as well as additional Series A Shares the Company may issue in the future. There was no financial consideration for the issuances of Series B Shares to Colin Tay. The Series B Shares do not participate in any declared dividends. The Series B Shares are redeemable on May 23, 2023 at par value of $0.001 per share. The consent of 80% of the holders of issued and outstanding Series B Shares is required in order to sell, assign or transfer any of the Series B Shares.


Sunday, July 29, 2012

Notable Share Transactions
On July 18, 2012, the Company issued 22,060,607 Series B Shares to Kenneth L. Waggoner, the Company’s General Counsel, Executive Vice-President Legal and Secretary; 22,060,607 Series B Shares to Carlos Trujillo, the Company’s Chief Financial Officer; and 22,060,608 Series B Shares to Kenneth Hobbs, the Company’s Vice-President of Mergers & Acquisitions (“Series B Issuance to Officers”). Each issuance independently represents approximately 11% of the total number of Series B Shares that are outstanding immediately following the three issuances in the aggregate. There was no financial consideration for the Series B Issuance to Officers. The Series B Issuance to Officers is effective prior to the Reverse Stock Split described under Item 5.03 below.

Saturday, June 16, 2012

Deal Flow

Since its most recent Report filed on any of Forms 8-K, 10-K or 10-Q, VelaTel Global Communications, Inc., a Nevada corporation, and the Registrant responsible for filing this current Report on Form 8-K (“Company”) has made the sales of unregistered securities identified below, namely shares of the Company’s Series A common stock (“Shares”). This Form 8-K is being filed because the aggregate number of Shares sold exceeds five percent (5%) of the total number of Shares issued and outstanding as of the Company’s latest filed Report, on Form 10-Q filed on May 21, 2012.

On June 13, 2012, the Company issued 60,612,408 Shares and 60,612,408 warrants to Isaac Organization, Inc. (“Isaac”) in payment of a promissory note in the amount of $500,000 due May 15, 2012. Each warrant has an exercise price of $0.0085 and an exercise term of three years.


Tuesday, May 22, 2012

Comments & Business Outlook
VELATEL GLOBAL COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
   
   
Three Months Ended March 31,
 
   
2012
   
2011
 
             
             
REVENUE
  $ 162,665     $ 204,371  
Cost of revenue
    388,856       219,712  
Gross loss
    (226,191 )     (15,341 )
                 
OPERATING EXPENSES:
               
Selling, general and administrative expenses
    3,100,445       1,980,076  
Depreciation and amortization
    141,800       31,914  
Research and development costs
    -       6,317,287  
Total operating expenses
    3,242,245       8,329,277  
                 
Net loss from operations
    (3,468,436 )     (8,344,618 )
                 
OTHER INCOME (EXPENSES):
               
Other income (expenses)
    49,618       (466 )
Gain on settlement of debt
    2,275,201       -  
Gain (loss)on foreign currency transactions
    (12,805 )     (6,159 )
Gain (loss) on change in fair value of debt derivative
    (55,950 )     37,523  
Interest expense
    (660,189 )     (28,216 )
Total other income (expense)
    1,595,875       2,682  
                 
Net loss
    (1,872,561 )     (8,341,936 )
                 
Loss attributed to non controlling interest
    17,886       5,394  
                 
NET LOSS ATTRIBUTABLE TO VELATEL GLOBAL COMMUNICATIONS, INC.
  $ (1,854,675 )   $ (8,336,542 )
                 
Net loss per common share (basic and fully diluted)
  $ (0.00 )   $ (0.02 )
Weighted average number of shares outstanding, basic and fully diluted
    728,639,086       449,061,685  
                 
Comprehensive Loss:
  $ (1,872,561 )   $ (8,341,936 )
Comprehensive loss attributable to the non controlling interest
    17,886       5,394  
Comprehensive loss attributable to Velatel Global Communications, Inc.
  $ (1,854,675 )   $ (8,336,542 )

Tuesday, April 24, 2012

Acquisition Activity

SAN DIEGO, CA--(Marketwire - Apr 24, 2012) - VelaTel Global Communications (OTCQB: VELA) (PINKSHEETS: VELA), a leader in deploying and operating wireless broadband and telecommunication networks worldwide, today announced it has entered into an Amended and Restated Subscription and Stockholder Agreement to acquire a 75% equity interest in Shenzhen VN Technologies Co., Ltd., a limited liability company in the Peoples Republic of China. VN Tech is a leading distributor of hydrogen fuel cells that satisfy the telecommunication industry standard to provide back-up power to operate data centers and remotely located infrastructure equipment during periods where primary electrical transmission is interrupted for any reason. Under the original agreement entered into just over one year ago, upon completion of forming corporate entities, VelaTel was to acquire 51% in the venture in exchange for five million of its publicly traded shares. VelaTel will now pay ten million shares to increase its stake to 75%.

Under the amended agreement, VN Tech PRC will become a wholly-owned subsidiary of a Hong Kong company, VN Tech Investments, Ltd. (HK). VN Tech HK will in turn become a wholly-owned subsidiary of a Cayman Island holding company, VN Tech Investments, Ltd. (Cayman). This corporate structure facilitates any foreign investment into VN Tech PRC, as well as the future ability to publicly list the venture on an offshore stock exchange such as Hong Kong. The transaction has been structured to allow VelaTel to report the results of the venture's operations on its consolidated financial statements in the same manner as its other subsidiaries. The transaction is considered fully completed, with exchange of shares and appointment of directors and officers to the holding companies to follow as expeditiously as possible.

VelaTel's President, Colin Tay, remarked: "VelaTel recognizes the enormous potential of hydrogen fuel cell technology. So do major telecommunications carriers like China Mobile and China Unicom, who in February commissioned VN Tech to conduct field trials that are now in progress. VelaTel's increased equity stake in VN Tech provides the platform for us to generate new revenue sources from third parties, and also to apply that technology to our own projects."


Monday, March 12, 2012

Deal Flow
On March 5, 2012, VelaTel Global Communications, Inc., a Nevada corporation and the registrant responsible for the filing of this Form 8-K (“Company”), granted a Line of Credit Promissory Note to Weal Group, Inc. (“Weal Note”) in the principal amount of $1,052,631.50. The disbursement amount of the Weal Note is $1,000,000.000. Weal will retain a 5% Holdback as a set-up fee and compensation for Weal’s due diligence. The difference between the disbursement amount and the principal amount represents the 5% Holdback fee. The Maturity Date of the Weal Note is March 5, 2013. The Company may prepay the Weal Note in whole or in part prior to its Maturity Date without penalty. The Weal Note bears interest on its principal amount at 10% per annum.

Wednesday, February 29, 2012

Deal Flow
Item 1.01  Entry into Material Definitive Agreements 

 

On February 23, 2012, VelaTel Global Communications, Inc., a Nevada corporation and the registrant responsible for the filing of this Form 8-K (“Company”) entered into the following agreements with Isaac Organization, Inc.: (1) Agreement to Extend and Increase First Line of Credit Loan Agreement and Promissory Note, Cancel Stock Purchase Agreement, and Grant Option in VN Tech Agreement (“Extension Agreement”); and (2) Second Line of Credit Loan Agreement and Promissory Note (“Second Note”). The Company and Isaac are sometimes referred to in each of these agreements and in this Form 8-K as a “Party” and collectively as the “Parties.”


Wednesday, February 8, 2012

Deal Flow
Item 3.02                    
  Unregistered Sale of Equity Securities
 
Since its last quarterly Report on Form 10-Q filed on November 14, 2012, VelaTel Global Communications, Inc., a Nevada corporation, and the Registrant responsible for filing this current Report on Form 8-K ("Company") has made the sales of unregistered securities identified below, namely shares of the Company's Series A common stock ("Shares").  This Form 8-K is being filed because the aggregate number of Shares sold exceeds five percent (5%) of the total number of Shares issued and outstanding as of the Company's Report on Form 10-Q filed November 14, 2011.
 
On December 2, 2011, the Company issued 934,657 Shares to Joaquin de Teresa pursuant to the Settlement Agreement and Mutual General Release between China Tel Group, Inc. and Joaquin de Teresa, effective as of December 15, 2010 (“Joaquin de Teresa Settlement Agreement”).  This sale of Shares resulted in a reduction of $154,125 in debt of the Company.
 
On December 2, 2011, the Company issued 15,000,000 Shares to Azur Capital (NBD) SDN BHD (“Azur”) pursuant to an Addendum to Subscription and Shareholder Agreement between the Company and Azur, effective as of December 2, 2011.  This sale of Shares resulted in an investment of $1,245,000 in Azur. This sale of Shares was previously reported on the Company's Report on Form 8-K filed on December 9, 2011.
 
On December 6, 2011, the Company issued 13,998,100 Shares to Joinmax Engineering & Consultants (HK) Ltd. (“Joinmax”) for professional services rendered to the Company pursuant to the Agreement for Professional Services between China Tel Group, Inc. and Joinmax effective as of April 10, 2009, as amended by the First Amendment to Agreement for Professional Services between VelaTel and Joinmax effective as of December 1, 2011 (“collectively, “Joinmax Professional Services Agreement”).  This sale of Shares resulted in a reduction of $1,399,810 in accounts payable of the Company.
 
On January 4, 2012, the Company issued 7,262,340 Shares to Joinmax for professional services rendered to the Company pursuant to the Joinmax Professional Services Agreement.  This sale of Shares resulted in a reduction of $726,234 in accounts payable of the Company.
 
On January 10, 2012, the Company issued 7,568,880 Shares to Joinmax for professional services rendered to the Company pursuant to the Joinmax Professional Services Agreement.  This sale of Shares resulted in a reduction of $756,888 in accounts payable of the Company.
 
On January 11, 2012, the Company issued 816,340 Shares to Joaquin de Teresa pursuant to the Joaquin de Teresa Settlement Agreement.  This sale of Shares resulted in a reduction of $77,062 in debt of the Company.
 
On February 2, 2012, the Company issued 7,405,040 Shares to Joinmax for professional services rendered to the Company pursuant to the Joinmax Professional Services Agreement.  This sale of Shares resulted in a reduction of $740,504 in debt of the Company.
 
The restricted Shares issued to the aforementioned persons and entities relied upon exemptions provided for in Sections 4(2) and 4(5) of the Securities Act of 1933, as amended, including Regulation D promulgated thereunder based on the aforementioned knowledge of our operations and financial condition and experience in financial and business matters that allowed them to evaluate the merits and risk of receipt of these securities.
 

Monday, December 19, 2011

Acquisition Activity
SAN DIEGO, CA--(Marketwire - Dec 19, 2011) - US-based VelaTel Global Communications (OTCQB: VELA) (PINKSHEETS: VELA) (VelaTel), a leader in deploying and operating wireless broadband and telecommunication networks worldwide, today announced it has entered into a Business Cooperation Agreement with the shareholders of Cyprus holding company Kerseyco Trading Limited to acquire at least a 51% controlling interest in Kerseyco and its Serbian operating subsidiary, VeratNet d.o.o. The transaction is expected to close in February 2012, in order to allow sufficient time for VelaTel's auditors to conduct the work needed to report the financial results of Kerseyco and its subsidiary on VelaTel's consolidated financial statements going forward.

Monday, November 28, 2011

Investor Alert
On November 18, 2011, VelaTel Global Communications, Inc., a Nevada corporation and the registrant responsible for the filing of this Report on Form 8-K (“the Company”), along with Trussnet Capital Partners (HK) Ltd. (“the Plaintiffs”), commenced litigation against Chinacomm Limited, Thrive Century International Limited, Newtop Holdings Limited, Smart Channel Development Limited, Mong Sin, Qiu Ping, Yuan Yi, CECT Chinacomm Communications Co. Ltd. and CECT Chinacomm Shanghai Co. Ltd. (“the Defendants”) in The High Court of the Hong Kong Special Administrative Region, Court of First Instance, Action No. 1978 of 2011 (“the Litigation”). The Litigation arises out of the breach of numerous agreements between the Plaintiffs and some of the Defendants, including, but not limited to, Framework Agreements and Subscription and Shareholders’ Agreements, related to a joint venture between the parties to those agreements for the deployment of a 3.5GHz wireless broadband telecommunications network in 29 cities (“the Chinacomm Network”) in the People’s Republic of China (“the PRC”). It addition, the Litigation arises out of what the Plaintiffs allege to be deceitful representations by certain of the Defendants in connection with the issuance of licenses by applicable regulatory agencies in the PRC for the operation of the Chinacomm Network. Finally, the Litigation involves the unauthorized removal of the signature of Colin Tay Yong Lee as an authorized signatory to a joint bank account Chinacomm Limited has with Standard Chartered Bank (HK) Limited, one of three Standard Chartered Bank (HK) Limited bank accounts in the name of Chinacomm Limited (“the Standard Accounts”) and into which the Plaintiffs deposited $4,749,599. The Litigation seeks injunctive relief, damages, including, but not limited to, loss of profits, restitution, reinstatement of any funds taken from the Standard

Friday, July 22, 2011

Deal Flow
On May 20, 2011, VelaTel Global Communications, Inc. (formerly China Tel Group, Inc.)1, a Nevada corporation and the registrant responsible for the filing of this current report on Form 8-K (“the Company”) issued 11,900,094 shares of its Series A common stock (“Stock”). The consideration the Company received in exchange for the issuance of these shares was reduction of accounts payable in the amount of $2,911,254 for professional services previously performed.

Monday, May 30, 2011

Investor Alert
On March 24, 2010, VRT Square, LP (“VRT”) filed a complaint against Mario Alvarez, an officer of the Company, and 18 other named defendants, including the Company, in the Superior Court of the State of California for the County of San Diego, Case No. 37-2010-00087536-CU-EN-CTL (“VRT Lawsuit”). The complaint alleges numerous causes of action against the defendants. The only cause of action asserted against the Company is an alleged conspiracy to defraud creditors of Mr. Alvarez, including VRT, and/or to effectuate a fraudulent transfer of Shares that had been issued to Mr. Alvarez in consideration for Mr. Alvarez performing professional services to the Company as an independent contractor. On or about May 1, 2011, the VRT Lawsuit was settled without monetary or other contribution on the part of the Company, with dismissal of the VRT Lawsuit to follow when all settlement documents have been executed by all parties.

Saturday, May 14, 2011

Deal Flow
On May 10, 2011 (“Effective Date”), China Tel Group, Inc., a Nevada corporation and the registrant responsible for the filing of this Form 8-K and Isaac Organization, Inc., a Canadian corporation, entered into a Second Amended and Restated Stock Purchase Agreement (“Second A&R Isaac SPA”). The parties originally entered into a stock purchase agreement on February 9, 2010 (“Isaac SPA”), subsequently amended the Isaac SPA on March 5, 2010 (“Amended Isaac SPA”) and then amended and restated the Isaac SPA, as amended, on May 9, 2010 (“A&R Isaac SPA”). The Second A&R Isaac SPA supersedes entirely the terms of the prior operative A&R Isaac SPA. The stock which is the subject of all of the Parties’ stock purchase agreements consists of shares of the Company’s Series A common stock, together with warrants granting the holder the right to acquire Shares. The material changes between the Second A&R Isaac SPA and the terms of the prior A&R Isaac SPA are as follows (capitalized terms are as defined in the Second A&R Isaac SPA):

Tuesday, April 19, 2011

Liquidity Requirements

Historically, we have financed our operations through the sale of equity and convertible debt, as well as borrowings from related parties.

Since our inception, we have incurred accumulated losses of approximately $231.9 million. As of December 31, 2010, we had cash of $27,516 and liabilities of approximately $28.1 million, which are deemed to be current liabilities. We expect to continue to incur net losses for the foreseeable future. Our independent accountants have expressed substantial doubt about our ability to continue as a going concern in their audit report, dated April 15, 2010, for the period ended December 31, 2010. In order to continue to operate our business, we will need to raise substantial amounts of additional capital.


Thursday, February 12, 2009

Share Structure

Outstanding Shares:  87,439,040

Source: Sec Form 10Q (For the quarter period ended November 30, 2008)


Sunday, June 8, 2008

Share Structure
Outstanding Shares: 79,325,603

Source: Sec Form 10Q (For the quarter period ended March 31, 2008)

GeoSpecial Notes
China Tel is devoting substantially all of its present efforts to establish a new business and none of its planned principal operations have commenced.

Source: Sec Form 10Q (For the quarter period ended March 31, 2008)




China Tel Group Enters Into Agreement to Acquire Trussnet USA, Inc:

Trussnet was formed in April 2008 to pursue investment opportunities in the wireless telecommunication industry in the People's Republic of China ("PRC"). Trussnet had no operations prior to entering into the Reorganization and Merger Agreement. CHTL intends to pursue an investment opportunity held by Trussnet to acquire a 49% interest in CECT-Chinacomm Communications Co., Ltd. that, through a Chinese subsidiary, will build and operate a 3.5GHz Wireless broadband system in up to 29 cities in the PRC.

Source: Marketwire (May 23, 2008)