Item 1.01. Entry into a Material Definitive Agreement
Business Combination Agreement
On December 5, 2022, TG Venture Acquisition Corp., a Delaware corporation
("TGVC"), entered into a Business Combination Agreement (the "Business
Combination Agreement") by and among (i) The Flexi Group Limited, a business
company with limited liability incorporated under the laws of the British Virgin
Islands (the "Flexi"), (ii) The Flexi Group Holdings, Ltd., a business company
with limited liability incorporated under the laws of the British Virgin Islands
and a direct wholly owned subsidiary of Flexi ("PubCo" and, together with Flexi,
the "Flexi Group"), (iii) The Flexi Merger Co. Ltd., a business company with
limited liability incorporated under the laws of the British Virgin Islands and
a direct wholly owned subsidiary of PubCo ("Merger Sub 1"), and (iv) Flexi
Merger Co. LLC, a Delaware limited liability company and a direct wholly owned
subsidiary of PubCo ("Merger Sub 2" and, Merger Sub 2, PubCo and Merger Sub 1,
each, individually, an "Acquisition Entity").
Capitalized terms used in this Current Report on Form 8-K but not otherwise
defined herein have the meanings given to them in the Business Combination
Agreement.
Pursuant to the Business Combination Agreement, subject to the terms and
conditions set forth therein, (i) Merger Sub 1 will merge with and into Flexi
(the "Initial Merger"), whereby the separate existence of Merger Sub 1 will
cease and Flexi will be the surviving entity of the Initial Merger and become a
wholly owned subsidiary of PubCo, and (ii) following confirmation of the
effective filing of the documents required to implement the Initial Merger,
Merger Sub 2 will merge with and into TGVC (the "SPAC Merger" and together with
the Initial Merger, the "Mergers"), the separate existence of Merger Sub 2 will
cease and TGVC will be the surviving entity of the SPAC Merger and a direct
wholly owned subsidiary of PubCo.
As a result of the Mergers, among other things, (i) each outstanding Flexi
Ordinary Share will be cancelled in exchange for the right to receive such
number of PubCo Ordinary Shares that is equal to the Company Exchange Ratio,
(ii) each outstanding SPAC Unit will be automatically detached and the holder
thereof will be deemed to hold one share of SPAC Class A Common Stock and one
SPAC Warrant, (iii) each outstanding share of SPAC Class B Common Stock will
automatically convert into SPAC Class A Common Stock, (iv) each outstanding
share of SPAC Class A Common Stock will be cancelled in exchange for the right
to receive such number of PubCo Ordinary Shares that is equal to the SPAC
Exchange Ratio, and (v) each outstanding SPAC Warrant will be assumed by PubCo
and converted into a warrant to purchase PubCo Ordinary Shares (each, an
"Assumed SPAC Warrant").
Earnout
The Business Combination Agreement, subject to the terms and conditions set
forth therein, provides that Flexi shareholders as of the Initial Merger will
have the right to receive up to an aggregate of 2,900,000 additional PubCo
Ordinary Shares based on the total annual revenues of PubCo in each of the two
fiscal years following the Closing Date.
Representations, Warranties and Covenants
The Business Combination Agreement contains customary representations and
warranties of the parties, which will not survive the Closing. Many of the
representations and warranties are qualified by materiality or Company Material
Adverse Effect (with respect to Flexi) or SPAC Material Adverse Effect (with
respect to TGVC). "Material Adverse Effect" as used in the Business Combination
Agreement means with respect to Flexi or TGVC, as applicable, any event, state
of facts, development, change, circumstance, occurrence or effect that has had,
or would reasonably be expected to have, individually or in the aggregate, a
material adverse effect on (i) the business, assets and liabilities, results of
operations or financial condition of the applicable party and its subsidiaries,
taken as a whole or (ii) the ability of such party or any of its subsidiaries to
consummate the Transactions, in each case subject to certain customary
exceptions. Certain of the representations are subject to specified exceptions
and qualifications contained in the Business Combination Agreement or in
information provided pursuant to certain disclosure schedules to the Business
Combination Agreement.
1
The Business Combination Agreement also contains pre-closing covenants of the
parties, including obligations of the parties to operate their respective
businesses in the ordinary course consistent with past practice, and to refrain
from taking certain specified actions without the prior written consent of the
other applicable parties, in each case, subject to certain exceptions and
qualifications. Additionally, the parties have agreed not to solicit, negotiate
or enter into competing transactions, as further provided in the Business
Combination Agreement. The covenants do not survive the Closing (other than
those that are to be performed after the Closing).
As promptly as practicable after the execution of the Business Combination
Agreement, TGVC and PubCo have agreed to prepare and file with the SEC, a
Registration Statement on Form F-4 (as amended, the "F-4 Registration
Statement") in connection with the registration under the Securities Act of
1933, as amended (the "Securities Act"), of the offer and issuance of the PubCo
Ordinary Shares and Assumed SPAC Warrants to be issued pursuant to the Business
Combination Agreement The F-4 Registration Statement will contain a proxy
statement/prospectus for the purpose of (i) TGVC soliciting proxies from its
shareholders to approve the Business Combination Agreement, the Transactions and
related matters (the "TGVC Shareholder Approval") at a special meeting of TGVC
shareholders (the "Shareholder Meeting"), (ii) providing TGVC's shareholders an
opportunity, in accordance with its organizational documents and initial public
offering prospectus, to redeem their shares of SPAC Class A Common Stock
(collectively, the "Redemptions"), and (iii) PubCo's offering and issuance of
the PubCo Ordinary Shares and Assumed Warrants in connection with the
Transactions.
PubCo agreed to take all action within its power so that effective at the
Closing, the board of directors of PubCo will consist of no less than five
individuals, two of whom may be designated by the Sponsor, and a majority of
whom shall be independent directors in accordance with Nasdaq requirements, and
which shall comply with all diversity requirements under applicable Law.
In addition, prior to Closing, PubCo agreed to amend and restate its Memorandum
of Association and Articles of Association (the "PubCo Governing Documents").
The PubCo Governing Documents will include customary provisions for a memorandum
of association and articles of association of a British Virgin Islands publicly
traded company that is traded on Nasdaq.
Conditions to the Parties' Obligations to Consummate the Mergers
Under the Business Combination Agreement, the parties' obligations to consummate
the Transactions are subject to a number of customary conditions for special
purpose acquisition companies, including, among others, the following: (i) the
approval of the Mergers and the other shareholder proposals required to approve
the Transactions by TGVC's and Flexi's shareholders, (ii) all specified
approvals or consents (including governmental and regulatory approvals) have
been obtained and all waiting, notice, or review periods have expired or been
terminated, as applicable, (iii) the effectiveness of the F-4 Registration
Statement, (iv) PubCo's initial listing application with Nasdaq shall have been
conditionally approved and, immediately following the Closing, PubCo shall
satisfy any applicable initial and continuing listing requirements of Nasdaq and
PubCo shall not have received any notice of non-compliance therewith, and (v)
the PubCo Ordinary Shares and Assumed SPAC Warrants having been approved for
listing on Nasdaq, subject to round lot holder requirements.
In addition to these customary closing conditions, TGVC must also hold net
tangible assets of at least $5,000,001 immediately prior to Closing, net of
Redemptions and liabilities (including TGVC's transaction expenses).
The obligations of TGVC to consummate the Transactions are also subject to,
among other things (i) the representations and warranties of Flexi and of each
Acquisition Entity being true and correct, subject to the materiality standards
contained in the Business Combination Agreement, (ii) material compliance by
Flexi and each Acquisition Entity with its pre-closing covenants, and (iii) the
absence of a Company Material Adverse Effect.
In addition, the obligations of Flexi to consummate the Transactions are also
subject to, among other things (i) the representations and warranties of TGVC
being true and correct, subject to the materiality standards contained in the
Business Combination Agreement, (ii) material compliance by TGVC with its
pre-closing covenants, and (iii) the absence of a SPAC Material Adverse Effect.
Termination Rights
The Business Combination Agreement contains certain termination rights,
including, among others, the following: (i) upon the mutual written consent of
TGVC and Flexi, (ii) if the consummation of the Transactions is prohibited by
governmental order, (iii) if the Closing has not occurred on or before May 5,
2023, (iv) in connection with a breach of a representation, warranty, covenant
or other agreement by Flexi or TGVC which is not capable of being cured or is
. . .
Item 7.01. Regulation FD Disclosure
On December 5, 2022, TGVC and Flexi issued a joint press release announcing the
execution of the Business Combination Agreement described in Item 1.01 above.
The press release is attached hereto as Exhibit 99.1 and incorporated into this
Item 7.01 by reference. Notwithstanding the foregoing, information contained on
the websites of TGVC, Flexi or any of their affiliates referenced in Exhibit
99.1 or linked therein or otherwise connected thereto does not constitute part
of nor is it incorporated by reference into this Current Report on Form 8-K.
The information in this Item 7.01, including Exhibit 99.1, is furnished and
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to
liabilities under that section, and shall not be deemed to be incorporated by
reference into the filings of TGVC under the Securities Act or the Exchange Act,
regardless of any general incorporation language in such filings. This Current
Report on Form 8-K will not be deemed an admission as to the materiality of any
of the information in this Item 7.01, including Exhibit 99.1.
Important Information and Where to Find It
This Current Report on Form 8-K relates to a proposed transaction between TGVC,
PubCo and Flexi. This Current Report on Form 8-K does not constitute an offer to
sell or exchange, or the solicitation of an offer to buy or exchange, any
securities, nor shall there be any sale of securities in any jurisdiction in
which such offer, sale or exchange would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction. In connection
with the transaction described herein, TGVC and PubCo intend to file relevant
materials with the SEC, including the F-4 Registration Statement, which will
include a proxy statement/prospectus. The proxy statement/prospectus will be
sent to all TGVC shareholders. TGVC and PubCo also will file other documents
regarding the proposed transaction with the SEC. Before making any voting or
investment decision, investors and security holders of TGVC are urged to read
the F-4 Registration Statement, the proxy statement/prospectus and all other
relevant documents filed or that will be filed with the SEC in connection with
the proposed transaction as they become available because they will contain
important information about the proposed transaction.
Investors and security holders will be able to obtain free copies of the proxy
statement/prospectus and all other relevant documents filed or that will be
filed with the SEC by TGVC through the website maintained by the SEC at
www.sec.gov or by directing a request to TGVC to 1390 Market Street, Suite 200,
San Francisco, CA 94102 or via email at info@tgventureaquisition.com.
Participants in the Solicitation
The Flexi Group, TGVC and their respective directors and executive officers may
be deemed to be participants in the solicitation of proxies from TGVC's
shareholders in connection with the proposed transaction. A list of the names of
such directors and executive officers, information regarding their interests in
the business combination and their ownership of TGVC's securities are, or will
be, contained in TGVC's filings with the SEC, and such information and names of
PubCo's directors and executive officers will also be in the F-4 Registration
Statement to be filed with the SEC by The Flexi Group, TGVC or a successor
entity thereof, which will include the proxy statement of TGVC. You may obtain
free copies of these documents as described in the preceding paragraph.
Non-Solicitation
This Current Report on Form 8-K is not a proxy statement or solicitation of a
proxy, consent or authorization with respect to any securities or in respect of
the potential transaction and shall not constitute an offer to sell or a
solicitation of an offer to buy the securities of TGVC, The Flexi Group, or any
successor entity thereof, nor shall there be any offer, solicitation, or sale of
any such securities in any state or jurisdiction in which such offer,
solicitation, or sale would be unlawful prior to registration or qualification
under the securities laws of such state or jurisdiction. No offer of securities
shall be made except by means of a prospectus meeting the requirements of the
Securities Act.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements include all statements that are not historical facts, including the
statements regarding the anticipated timing and benefits of the proposed
transactions. All forward-looking statements are based on TGVC's current
expectations and beliefs concerning future developments and their potential
effects on TGVC, The Flexi Group or any successor entity thereof.
Forward-looking statements are based on various assumptions, whether or not
identified in this press release, and are subject to risks and uncertainties.
These forward-looking statements are not intended to serve as a guarantee of
future performance.
Many factors could cause actual future events to differ materially from the
forward-looking statements in this Current Report on Form 8-K, including but not
limited to: (i) the failure to satisfy the conditions to the consummation of the
transaction, including the adoption of the Business Combination Agreement by
TGVC's shareholders, the satisfaction of the minimum trust account amount
following any Redemptions by TGVC's public shareholders, (ii) the occurrence of
any event, change or other circumstance that could give rise to the termination
of the Business Combination Agreement, (iii) the effect of the announcement or
pendency of the transaction on The Flexi Group's business relationships,
operating results and business generally, (iv) risks that the transaction
disrupts current plans and operations of The Flexi Group, (v) the outcome of any
legal proceedings that may be instituted against The Flexi Group or TGVC related
to the Business Combination Agreement or the proposed transaction, (vi) costs
related to the transaction and the failure to realize anticipated benefits of
the transaction or to realize estimated pro forma results and underlying
assumptions, including with respect to estimated shareholder Redemptions, (vii)
the risk that The Flexi Group and its current and future collaborators are
unable to successfully develop and commercialize The Flexi Group's products or
services, or experience significant delays in doing so, (viii) the risk that The
Flexi Group may need to raise additional capital to execute its business plan,
which many not be available on acceptable terms or at all, and (ix) the risk
that the post-combination company experiences difficulties in managing its
growth and expanding operations. The foregoing list of factors is not
exhaustive. You should carefully consider the foregoing factors and the other
risks and uncertainties described in the "Risk Factors" section of the F-4
Registration Statement and proxy statement/prospectus discussed above and other
documents filed or to be filed by TGVC, The Flexi Group and/or or any successor
entity thereof from time to time with the SEC. These filings identify and
address other important risks and uncertainties that could cause actual events
and results to differ materially from those contained in the forward-looking
statements. Forward-looking statements speak only as of the date they are made.
Readers are cautioned not to put undue reliance on forward-looking statements,
and TGVC assumes no obligation and do not intend to update or revise these
forward-looking statements, whether as a result of new information, future
events, or otherwise, except as required by law.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
2.1* Business Combination Agreement, dated as of December 5, 2022, by and
among TGVC, PubCo, Merger Sub 1, Merger Sub 2 and Flexi.
10.1 Form of Shareholder Support Agreement.
10.2 Form of Sponsor Support Agreement.
10.3 Form of Lock-Up Agreement.
10.4 Form of Registration Rights Agreement.
99.1 Joint Press Release, dated December 5, 2022.
* Certain exhibits and schedules to this Exhibit have been omitted in
accordance with Regulation S-K Item 601(a)(5). TGVC agrees to furnish
supplementally a copy of any omitted exhibit or schedule to the SEC upon its
request; however, TGVC may request confidential treatment of omitted items.
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