Cayman Islands*
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6770
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98-1574120
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(State or other jurisdiction of
incorporation or organization)
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(Primary Standard Industrial
Classification Code Number)
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(I.R.S. Employer
Identification Number)
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Lorenzo Corte, Esq.
Skadden, Arps, Slate, Meagher & Flom (UK) LLP
22 Bishopsgate
London EC2N 4BQ
United Kingdom
+44 20 7519 7000
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Ryan J. Maierson, Esq.
Latham & Watkins LLP
811 Main Street, Suite 3700
Houston, TX 77002
(713) 546-5400
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Large accelerated filer
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☐
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Accelerated filer
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☐
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Non-accelerated filer
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☒
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Smaller reporting company
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☒
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Emerging growth company
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☒
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By Order of the RMG III Board,
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Robert S. Mancini
Chairman of the Board |
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○
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The accompanying proxy statement/prospectus is dated , 2024 and is first
being mailed to RMG III shareholders and RMG III warrant holders on or about , 2024.
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•
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Proposal No. 1: The Business Combination Proposal—to consider and vote upon a
proposal to approve by ordinary resolution and adopt the Agreement and Plan of Merger, dated as of May 9, 2023 (as the same has been amended as of December 18, 2023 and may be further amended from time to time, the “Merger Agreement”), by and between RMG III and H2B2 Electrolysis Technologies, Inc., a Delaware corporation (“H2B2”), a copy of which
is attached to the accompanying proxy statement/prospectus as Annex A and Annex A-1. The Merger Agreement provides for, among other things, the merger of H2B2 with and into RMG III (the “Merger”), with RMG III surviving the Merger, in accordance with the terms and subject to the conditions of the Merger Agreement as more fully described elsewhere in the accompanying proxy
statement/prospectus (the “Business Combination Proposal”);
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•
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Proposal No. 2: The Domestication Proposal—to consider and vote upon a proposal to
approve by special resolution, the change of RMG III’s jurisdiction of incorporation by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation incorporated under the laws of the
State of Delaware (the “Domestication” and, together with the Merger, the “Business Combination” and, such proposal, the “Domestication Proposal”);
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•
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Proposal No. 3: The Organizational Documents Proposals—to consider and vote upon the
following four separate proposals (collectively, the “Organizational Documents Proposals”) to approve by special resolution, the following material differences between RMG III’s Amended and
Restated Memorandum and Articles of Association (as may be amended from time to time, the “RMG III Governing Documents,” a copy of which is attached to the accompanying proxy statement/prospectus
as Annex F) and the proposed new certificate of incorporation (“Proposed Certificate of Incorporation”) and the proposed new bylaws (the “Proposed
Bylaws” and, together with the Proposed Certificate of Incorporation, the “Proposed Organizational Documents,” copies of which are attached to the accompanying proxy statement/prospectus
as Annex G and Annex H, respectively) of the Surviving Corporation, each of the Proposed Organizational Documents to be effective upon the consummation of the Business Combination pursuant to which the
Surviving Corporation will be renamed “H2B2 Electrolysis Technologies, Inc.” in connection with the Business Combination (the “Organizational Documents Proposal”);
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•
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Proposal No. 4—The Director Election Proposal—to consider and vote upon a proposal to
approve by ordinary resolution of the holders of the RMG III Class B Ordinary Shares, assuming the Business Combination Proposal, the Domestication Proposal and the Organizational Documents Proposals are approved, the election of
directors who, upon consummation of the Business Combination, will be the directors of the Surviving Corporation (the “Director Election Proposal”), to be effective as of the Closing;
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•
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Proposal No. 5—The Stock Issuance Proposal—to consider and vote upon a proposal to
approve by ordinary resolution for purposes of complying with the applicable provisions of Nasdaq Listing Rule 5635, the issuance of Surviving Corporation Common Stock to the H2B2 Securityholders (as defined elsewhere in the
accompanying proxy statement/prospectus) pursuant to the Merger Agreement (the “Stock Issuance Proposal”), to be effective prior to or substantially concurrently with the Closing;
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•
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Proposal No. 6—The Equity Incentive Plan Proposal—to consider and vote upon a proposal
to approve by ordinary resolution, the Incentive Plan (the “Equity Incentive Plan Proposal,” a copy of which is attached to this proxy statement/prospectus as Annex I), to be effective as of the
Closing; and
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•
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Proposal No. 7—The Adjournment Proposal—to consider and vote upon a proposal to approve
by ordinary resolution, the adjournment of the Special Meeting to a later date or dates, if necessary, (i) to permit further solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more
proposals at the Special Meeting or (ii) if the RMG III Board determines before the Special Meeting that is not necessary or no longer desirable to proceed with the proposals (the “Adjournment Proposal”
and, together with each of Proposal No. 1 through Proposal No. 7, the “Proposals”).
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(i)
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(a) hold Public Shares, or (b) if you hold Public Shares through RMG III Units, you elect to separate your units into the
underlying Public Shares and redeemable warrants (“RMG III Public Warrants”) prior to exercising your redemption rights with respect to the Public Shares;
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(ii)
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submit a written request to Continental Stock Transfer & Trust Company (“Continental”),
RMG III’s transfer agent, that RMG III redeem all or a portion of your Public Shares for cash; and
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(iii)
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tender or deliver your Public Shares (and share certificates (if any) and other redemption forms) to Continental electronically
through DTC.
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By Order of the RMG III Board,
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Robert S. Mancini
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Chairman of the Board
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•
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Proposal No. 1 — The Warrant Amendment Proposal — to consider
and vote upon an amendment to the warrant agreement that governs all of RMG III’s outstanding warrants (the “Warrant Agreement”). The Warrant Amendment proposes to amend
the Warrant Agreement to provide that, upon the closing of the Business Combination (the “Closing”), each of the then outstanding Domesticated RMG III Warrants (such warrants
being the (i) warrants of RMG III issued in RMG III’s initial public offering that was consummated on February 9, 2021 (the “Initial Public Offering”), which
entitle the holder thereof to purchase one Class A ordinary share, par value $0.0001 per share, of RMG III (an “RMG III Class A Ordinary Share”) at an exercise price of $11.50 per
share (the “RMG III Public Warrants”) and (ii) the warrants of RMG III, which entitle the holder thereof to purchase one RMG III Class A Ordinary Share at an
exercise price of $11.50 per share, issued in a private placement concurrent with the closing of the Initial Public Offering (the “RMG III Private Placement Warrants” and,
together with the RMG III Public Warrants, the “RMG III Warrants”) following the Domestication) will be canceled and exchanged for the right to receive up to 0.075 shares of
common stock, par value $0.0001 per share, of the Surviving Corporation (the “Surviving Corporation Common Stock” and, such proposal, the “Warrant Amendment Proposal”), the substantive text of which is attached to the accompanying proxy statement/prospectus as Annex J; and
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•
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Proposal No. 2 — Warrant Holders Adjournment Proposal — to consider and vote upon a
proposal to approve the adjournment of the Warrant Holders Meeting to a later date or dates, if necessary, to permit the further solicitation and vote of proxies if, based upon the tabulated vote at the time of the Warrant Holders
Meeting, the Warrant Amendment Proposal would not be duly approved and adopted by the holders of the requisite amount of each of (i) the then outstanding RMG III Public Warrants and (ii) the then outstanding RMG III Private Placement
Warrants (the “Warrant Holders Adjournment Proposal” and, together with the Warrant Amendment Proposal, the “Warrant Holder Proposals”).
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By Order of the RMG III Board,
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Robert S. Mancini
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Chairman of the Board
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1.
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The unaudited condensed financial statements and notes thereto as of and for the three and nine-month periods ended September
30, 2023 of RMG III (hereinafter referred to as the “2023 Unaudited Condensed Financial Statements of RMG III”);
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2.
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The audited financial statements and notes thereto as of and for the years ended December 31, 2022 and 2021 of RMG III, prepared
in accordance with GAAP (hereinafter referred to as the “2022 Audited Consolidated Financial Statements of RMG III”);
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3.
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The unaudited condensed consolidated financial statements and notes thereto as of and for the three and nine-month periods
ended September 30, 2023 of H2B2 (hereinafter referred to as the “2023 Unaudited Interim Condensed Consolidated Financial Statements of H2B2”);
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4.
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The audited consolidated financial statements and notes thereto as of and for the years ended December 31, 2022 and 2021 of
H2B2, prepared in accordance with GAAP (hereinafter referred to as the “2022 Audited Consolidated Financial Statements of H2B2”); and
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5.
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The unaudited pro forma combined financial information of H2B2 and RMG III as of and for the period ended September 30, 2023,
prepared in accordance with Article 11 of SEC Regulation S-X. (see “Unaudited Pro Forma Combined Financial Information” for further information).
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Q:
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WHAT IS THE BUSINESS COMBINATION?
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A:
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RMG III and H2B2 have entered into the Merger Agreement, pursuant to which (i) RMG III will deregister as an exempted company
incorporated in the Cayman Islands and domesticate as a Delaware corporation, and (ii) H2B2 will merge with and into RMG III, with RMG III surviving the Merger. In connection with the Closing, the Surviving Corporation will be renamed
“H2B2 Electrolysis Technologies, Inc.” RMG III will hold the Special Meeting to, among other things, obtain the approvals required for the Business Combination and the other transactions contemplated by the Merger Agreement, and you
are receiving this proxy statement/prospectus in connection with such meeting. See the section entitled “The Merger Agreement” for more information. In addition, a copy of
the Merger Agreement and the Merger Agreement Amendment are attached to this proxy statement/prospectus as Annex A and Annex A-1, respectively. We urge you to carefully read this proxy statement/prospectus,
including the annexes and the other documents referred to herein, in their entirety.
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Q:
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WHY AM I RECEIVING THIS DOCUMENT?
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A:
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RMG III is sending this proxy statement/prospectus to its RMG III shareholders and RMG III warrant holders to help them
decide how to vote their RMG III Class A Ordinary Shares and/or RMG III Warrants with respect to the matters to be considered at the Special Meetings. The Business Combination cannot be completed unless RMG III shareholders approve
the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposals, the Director Election Proposal, the Stock Issuance Proposal and the Equity Incentive Plan Proposal, and the RMG III warrant holders
also approve the Warrant Amendment Proposal set forth in this proxy statement/prospectus for their respective approvals. Information about the Special Meetings, the Business Combination and the other business to be considered by
RMG III shareholders and RMG III warrant holders at the Special Meetings is contained in this proxy statement/prospectus. This document constitutes a proxy statement/prospectus of RMG III. It is a proxy statement/prospectus because
the RMG III Board is soliciting proxies using this proxy statement/prospectus from RMG III shareholders and RMG III warrant holders.
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Q:
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WHAT WILL H2B2 STOCKHOLDERS RECEIVE IN THE BUSINESS COMBINATION?
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A:
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As part of the Business Combination, the H2B2 Stockholders will receive a number of shares of Surviving Corporation Common
Stock equal to the quotient obtained by dividing (i) the Closing Date Purchase Price by (ii) $10.00, the Aggregate Closing Date Merger Consideration, as discussed in more detail in this proxy statement/prospectus. See the section
entitled “The Merger Agreement—Merger Consideration; Conversion of Shares” for more information.
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Q:
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WHAT WILL HAPPEN TO RMG III SECURITIES UPON THE CONSUMMATION OF THE BUSINESS COMBINATION?
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A:
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RMG III Units, RMG III Class A Ordinary Shares and RMG III Public Warrants are currently listed on Nasdaq under the symbols
“RMGCU,” “RMGC” and “RMGCW,” respectively. At the time of Domestication, (i) each of the then issued and outstanding RMG III Class A Ordinary Shares will convert automatically, on a one-for-one basis, into a share of Domesticated RMG
III Class A Stock, (ii) each of the then issued and outstanding RMG III Class B Ordinary Shares will convert automatically, on a one-for-one basis, into a share of Domesticated RMG III Class B Stock, (iii) each of the then outstanding
RMG III
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Q:
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WHAT WILL HAPPEN TO H2B2 SECURITIES PRIOR TO OR UPON THE CONSUMMATION OF THE BUSINESS COMBINATION?
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A:
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At the Effective Time, all shares of H2B2 Common Stock issued and outstanding immediately prior to the Effective Time
(excluding (i) shares subject to H2B2 Options, (ii) any shares of H2B2 Common Stock held in the treasury of H2B2, which treasury shares shall be canceled as part of the Merger and shall not constitute capital stock of H2B2 and (iii)
the Dissenting Shares will be canceled and converted into the right to receive a portion of the Aggregate Closing Date Merger Consideration.
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Q:
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WHEN DO YOU EXPECT THE BUSINESS COMBINATION TO BE COMPLETED?
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A:
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It is currently anticipated that the Business Combination will be consummated promptly following the Special Meetings, which
is set for , 2024; however, each meeting could be adjourned, as described herein. Neither RMG III nor H2B2 can assure you of when or if the Business Combination will be completed and it is possible that factors outside of the
control of both parties could result in the Business Combination being completed at a different time or not at all. RMG III must first obtain the approval of RMG III shareholders and RMG III warrant holders for certain of the
Proposals and the Warrant Amendment Proposal as set forth in this proxy statement/prospectus and RMG III and H2B2 must also satisfy other closing conditions. See the section entitled “The
Merger Agreement—Conditions to Closing of the Business Combination” for more information.
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Q:
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WHAT HAPPENS IF THE BUSINESS COMBINATION IS NOT COMPLETED?
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A:
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If the Business Combination is not completed, RMG III will not complete the Domestication to Delaware unless all other
conditions to the consummation of the Business Combination have been satisfied or waived by the parties in accordance with the terms of the Merger Agreement. If RMG III is not able to complete the Business Combination with H2B2 by the
Completion Window and is not able to complete another business combination by such date, in each case, as such date may be extended pursuant to the RMG III Governing Documents, RMG III will: (1) cease all operations except for the
purpose of winding up; (2) as
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Q:
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HOW WILL RMG III BE MANAGED AND GOVERNED FOLLOWING THE BUSINESS COMBINATION?
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A:
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In connection with the Closing, RMG III will be renamed “H2B2 Electrolysis Technologies, Inc.” Following the Closing, the
Surviving Corporation will be managed by the Surviving Corporation Board, which is expected to consist of nine (9) directors (with a majority of the directors expected to be independent under applicable Nasdaq listing rules), and its
executive officers are expected to be the current management team of H2B2. See the section entitled “Management of the Surviving Corporation Following the Business Combination” for more
information.
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Q:
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WHAT WILL BE THE RELATIVE EQUITY STAKES OF PUBLIC SHAREHOLDERS, THE SPONSOR, THE RMG III INVESTORS AND H2B2
STOCKHOLDERS IN THE SURVIVING CORPORATION UPON CONSUMMATION OF THE BUSINESS COMBINATION?
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A:
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Upon consummation of the Business Combination, the undiluted post-Closing share ownership of Surviving Corporation is expected
to be as follows:
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Undiluted Share Ownership in the Surviving Corporation(1)
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Pro Forma Combined
(Assuming No
Redemptions)
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Pro Forma Combined
(Assuming 25%
Redemptions)
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Pro Forma Combined
(Assuming 50%
Redemptions)
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Pro Forma Combined
(Assuming 75%
Redemptions)
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Pro Forma Combined
(Assuming Maximum
Redemptions)
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Stockholders
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Number of
Shares
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%
Ownership
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Number of
Shares
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%
Ownership
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Number of
Shares
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%
Ownership
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Number of
Shares
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%
Ownership
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Number of
Shares
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%
Ownership
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H2B2 Stockholders(2)
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40,000,000
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91.57%
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40,000,000
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91.93%
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40,000,000
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92.28%
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40,000,000
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92.65%
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40,000,000
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93.01%
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Public Shareholders(3)
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635,778
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1.46%
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476,834
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1.10%
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317,889
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0.73%
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158,945
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0.37%
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—
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—
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Sponsor(4)
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1,508,368
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3.45%
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1,498,223
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3.44%
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1,488,077
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3.43%
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1,477,932
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3.42%
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1,467,786
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3.41%
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Other Stockholders(5)
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197,500
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0.45%
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197,500
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0.45%
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197,500
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0.46%
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197,500
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0.46%
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197,500
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0.46%
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RMG III Warrants
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Holders of RMG III Private Placement Warrants(6)
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616,225
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1.41%
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616,225
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1.42%
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616,225
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1.42%
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616,225
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1.43%
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616,225
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1.43%
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Holders of RMG III Public Warrants(7)
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724,500
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1.66%
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724,500
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1.66%
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724,500
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1.68%
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724,500
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1.67%
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724,500
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1.69%
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Total Shares Outstanding
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43,682,371
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100.0%
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43,513,281
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100.0%
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43,344,191
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100.0%
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43,175,101
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100.0%
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43,006,011
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100.0%
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Total Pro Forma Book Value
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54,238,482
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52,569,565
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50,900,648
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49,231,730
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47,583,287
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Pro Forma Book Value per Share Outstanding
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1.24
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1.21
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1.17
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1.14
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1.11
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(1)
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Share ownership under each redemption scenario is only presented for illustrative purposes. RMG III cannot predict how many of
its Public Shareholders will exercise their right to have their Public Shares redeemed for cash. As a result, the RMG III Share Redemption Amount and the number of RMG III Class A Ordinary Shares redeemed in connection with the Business
Combination may differ from the amounts presented above. As such, the ownership percentages of H2B2 Stockholders, Public Shareholders, Sponsor, Holders of RMG III Public Warrants, and other stockholders may also differ from the
presentation above if the actual redemptions are different from these assumptions.
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(2)
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Assumes that the Closing Date Purchase Price is $400,000,000.
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(3)
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Excludes 724,500 shares of Surviving Corporation Common Stock issuable in respect of any RMG III Public Warrants that may be
held by Public Shareholders pursuant the proposed terms of the Warrant Amendment, subject to change.
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(4)
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Such shares of Surviving Corporation Common Stock issuable in respect of 12,075,000 RMG III Class B Ordinary Shares held by
the Sponsor, as converted pursuant to the Merger Agreement, inclusive of the 255,319 shares of Surviving Corporation Common Stock issuable in respect of the Convertible Notes of $30.0 million. Excludes 616,225 shares of Surviving
Corporation Common Stock issuable in respect of the 8,216,330 RMG III Private Placement Warrants owned by the Sponsor pursuant the proposed terms of the Warrant Amendment, subject to change.
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(5)
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Such shares of Surviving Corporation Common Stock issuable to Cohen for services provided in connection with the First
Extension and the 172,500 shares of Surviving Corporation Common Stock issuable in exchange of the Convertible Debt of $1.5 million with a conversion premium of 15%, as described elsewhere in this proxy statement/prospectus.
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(6)
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Such shares of Surviving Corporation Common Stock issuable in respect of 8,216,330 RMG III Private Placement Warrants pursuant
the proposed terms of the Warrant Amendment, subject to change.
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(7)
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Such shares of Surviving Corporation Common Stock issuable in respect of 9,660,000 RMG III Public Warrants pursuant the
proposed terms of the Warrant Amendment, subject to change.
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Fully Diluted Share Ownership in the Surviving Corporation(1)(2)
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Pro Forma Combined
(Assuming No
Redemptions)
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Pro Forma Combined
(Assuming 25%
Redemptions)
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| |
Pro Forma Combined
(Assuming 50%
Redemptions)
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| |
Pro Forma Combined
(Assuming 75%
Redemptions)
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| |
Pro Forma Combined
(Assuming Maximum
Redemptions)
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|||||||||||||||
Stockholders
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| |
Number of
Shares
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| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
H2B2 Stockholders(3)
|
| |
40,000,000
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| |
91.57%
|
| |
40,000,000
|
| |
91.93%
|
| |
40,000,000
|
| |
92.28%
|
| |
40,000,000
|
| |
92.65%
|
| |
40,000,000
|
| |
93.01%
|
Public Shareholders(4)
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| |
635,778
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1.46%
|
| |
476,834
|
| |
1.10%
|
| |
317,889
|
| |
0.73%
|
| |
158,945
|
| |
0.37%
|
| |
—
|
| |
—
|
Sponsor(5)
|
| |
1,508,368
|
| |
3.45%
|
| |
1,498,223
|
| |
3.44%
|
| |
1,488,077
|
| |
3.43%
|
| |
1,477,932
|
| |
3.42%
|
| |
1,467,786
|
| |
3.41%
|
Other Stockholders(6)
|
| |
197,500
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| |
0.45%
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
RMG III Warrants
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Holders of RMG III Private Placement Warrants(7)
|
| |
616,225
|
| |
1.41%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.43%
|
| |
616,225
|
| |
1.43%
|
Holders of RMG III Public Warrants(8)
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| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.68%
|
| |
724,500
|
| |
1.67%
|
| |
724,500
|
| |
1.69%
|
Equity Incentive Plan
|
| |
|
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|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Incentive Plan(9)
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Total Shares Outstanding
|
| |
43,682,371
|
| |
100.0%
|
| |
43,513,281
|
| |
100.0%
|
| |
43,344,191
|
| |
100.0%
|
| |
43,175,101
|
| |
100.0%
|
| |
43,006,011
|
| |
100.0%
|
Total Pro Forma Book Value
|
| |
54,238,482
|
| |
—
|
| |
52,569,565
|
| |
—
|
| |
50,900,648
|
| |
—
|
| |
49,231,730
|
| |
—
|
| |
47,583,287
|
| |
—
|
Pro Forma Book Value per Share Outstanding
|
| |
1.24
|
| |
—
|
| |
1.21
|
| |
—
|
| |
1.17
|
| |
—
|
| |
1.14
|
| |
—
|
| |
1.11
|
| |
|
(1)
|
Share ownership under each redemption scenario is only presented for illustrative purposes. RMG III cannot predict how many of
its Public Shareholders will exercise their right to have their Public Shares redeemed for cash. As a result, the RMG III Share Redemption Amount and the number of RMG III Class A Ordinary Shares redeemed in connection with the Business
Combination may differ from the amounts presented above. As such, the ownership percentages of H2B2 Stockholders, Public Shareholders, Sponsor, Holders of RMG III Public Warrants, and other stockholders may also differ from the
presentation above if the actual redemptions are different from these assumptions.
|
(2)
|
This presentation includes shares that may be issued but are not presently outstanding and, as such, differ from the share counts
shown or assumed in the sections entitled “Summary Unaudited Pro Forma Condensed Combined Financial Information” and “Unaudited Pro Forma Condensed Combined
Financial Information,” which sections are limited to shares that are presently issued and outstanding
|
(3)
|
Assumes that the Closing Date Purchase Price is $400,000,000.
|
(4)
|
Excludes 724,500 shares of Surviving Corporation Common Stock issuable in respect of any RMG III Public Warrants that may be
held by Public Shareholders pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(5)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 12,075,000 RMG III Class B Ordinary Shares held by
the Sponsor, as converted pursuant to the Merger Agreement, inclusive of the 255,319 shares of Surviving Corporation Common Stock issuable in respect of the Convertible Notes of $30.0 million. Excludes 616,225 shares of Surviving
Corporation Common Stock issuable in respect of the 8,216,330 RMG III Private Placement Warrants owned by the Sponsor pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(6)
|
Such shares of Surviving Corporation Common Stock issuable to Cohen for services provided in connection with the First
Extension and the 172,500 shares of Surviving Corporation Common Stock issuable in exchange of the Convertible Debt of $1.5 million with a conversion premium of 15%, as described elsewhere in this proxy statement/prospectus.
|
(7)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 8,216,330 RMG III Private Placement Warrants pursuant
the proposed terms of the Warrant Amendment, subject to change.
|
(8)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 9,660,000 RMG III Public Warrants pursuant the
proposed terms of the Warrant Amendment, subject to change.
|
(9)
|
Such shares of Surviving Corporation Common Stock expected to be reserved under the Incentive Plan (assuming the Equity Incentive
Plan Proposal is approved).
|
Q:
|
WHAT ARE THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE DOMESTICATION?
|
A:
|
Any RMG III Class A Ordinary Shares that are redeemed pursuant to the redemption rights described herein will be canceled prior
to the Domestication, and will not be exchanged for shares of Domesticated RMG III Class A Stock pursuant to the Domestication. Accordingly, RMG III shareholders that exercise their redemption rights with respect to their RMG III
Class A Ordinary Shares are not expected to be subject to the U.S. federal income tax consequences of the Domestication described below with respect to such redeemed shares.
|
•
|
A U.S. Holder whose RMG III Class A Ordinary Shares have a fair market value of less than $50,000 on the date of the
Domestication will not be required to include any part of RMG III’s earnings in income and will not, subject to the application of the PFIC rules described below, recognize any gain or loss;
|
•
|
A U.S. Holder whose RMG III Class A Ordinary Shares have a fair market value of $50,000 or more and who, on the date of the
Domestication, owns (actually or constructively) less than 10% of the total combined voting power of all classes of RMG III stock entitled to vote and less than 10% of the total value of all classes of RMG III stock, will generally
recognize gain (but not loss) on the exchange of RMG III Class A Ordinary Shares for shares of Domesticated RMG III Class A Stock pursuant to the Domestication. As an alternative to recognizing gain, such U.S. Holder may file an
election to include in income as a deemed dividend the “all earnings and profits amount” (as defined in the Treasury Regulations under Section 367 of the Code) attributable to its RMG III Class A Ordinary Shares provided certain other
requirements are satisfied; and
|
•
|
A U.S. Holder whose RMG III Class A Ordinary Shares have a fair market value of $50,000 or more and who, on the date of the
Domestication, owns (actually or constructively) 10% or more of the total combined voting power of all classes of RMG III stock entitled to vote or 10% or more of the total value of all classes of RMG III stock, will generally be
required to include in income as a deemed dividend the all earnings and profits amount attributable to its RMG III Class A Ordinary Shares.
|
Q:
|
WHEN AND WHERE ARE THE SPECIAL MEETING AND THE WARRANT HOLDERS MEETING?
|
A:
|
The Special Meeting and the Warrant Holders Meeting will be held at the offices of Skadden, Arps, Slate, Meagher & Flom
LLP located at One Manhattan West, New York, New York 10001, on , 2024, and virtually at . RMG III shareholders and RMG III warrant holders may attend, vote and examine the list of RMG III shareholders and RMG III warrant
holders entitled to vote at the Special Meeting and the Warrant Holders Meeting, respectively, by visiting and entering the control number found on their proxy card, voting instruction form or notice included in their proxy materials.
|
Q:
|
WHAT AM I BEING ASKED TO VOTE ON IN THE SPECIAL MEETING AND WHY IS THIS APPROVAL NECESSARY?
|
A:
|
The Public Shareholders are being asked to vote on the following:
|
•
|
A proposal to adopt the Merger Agreement and the transactions contemplated thereby. See the section entitled “Proposal No. 1—The Business Combination Proposal.”
|
•
|
A proposal to adopt the change of RMG III’s jurisdiction of incorporation by deregistering as an exempted company in the Cayman
Islands and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware. See the section entitled “Proposal No. 2—The Domestication Proposal.”
|
•
|
A proposal to adopt the Proposed Organizational Documents of RMG Acquisition Corp. III (a corporation incorporated in the State
of Delaware, each to be effective upon completion of the Business Combination which will be renamed “H2B2 Electrolysis Technologies, Inc.”). See the section entitled “Proposal No. 3—The Organizational
Documents Proposal.”
|
•
|
A proposal to elect, assuming the Business Combination Proposal, the Domestication Proposal and the Organizational Documents
Proposals are adopted, directors who, upon consummation of the Business Combination, will be the directors of the Surviving Corporation, to be effective as of the Closing. See the section entitled “Proposal
No. 4—The Director Election Proposal.”
|
•
|
A proposal to approve, for purposes of complying with applicable listing rules of Nasdaq, the issuance of shares of Surviving
Corporation Common Stock to the H2B2 Securityholders pursuant to the Merger Agreement. See the section entitled “Proposal No. 5—The Stock Issuance Proposal.”
|
•
|
A proposal to approve and adopt the H2B2 Electrolysis Technologies, Inc. 2023 Incentive Award Plan in the form attached hereto
as Annex I. See the section entitled “Proposal No. 6—The Equity Incentive Plan Proposal.”
|
•
|
A proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary, (i) to permit further
solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more proposals at the Special Meeting or (ii) if the RMG III Board determines before the Special Meeting that it is not necessary
or no longer desirable to proceed with the proposals. See the section entitled “Proposal No. 7—The Adjournment Proposal.”
|
Q:
|
I AM AN RMG III WARRANT HOLDER. WHY I AM RECEIVING THIS PROXY STATEMENT/PROSPECTUS?
|
A:
|
RMG III warrant holders are being asked to consider and vote upon a proposal to amend the Warrant Agreement to provide that,
at Closing, each of the then outstanding Domesticated RMG III Warrants will be canceled and exchanged for the right to receive up to 0.075 shares of Surviving Corporation Common Stock.
|
Q:
|
WHAT AM I BEING ASKED TO VOTE ON IN THE WARRANT HOLDERS MEETING AND WHY IS THIS APPROVAL NECESSARY?
|
A:
|
The RMG III warrant holders are being asked to vote on the following:
|
•
|
A proposal to approve the amendment of the Warrant Agreement to provide that, at Closing, each of the then outstanding
Domesticated RMG III Warrants will be canceled and exchanged for the right to receive up to 0.075 shares of Surviving Corporation Common Stock. See the section entitled “Warrant Holder
Proposal No. 1—The Warrant Amendment Proposal.”
|
•
|
A proposal to approve the adjournment of the Warrant Holders Meeting to a later date or dates, if necessary, for the absence of
a quorum, to solicit additional proxies from RMG III warrant holders to approve the Warrant Amendment Proposal or to ensure that any supplement or amendment to this proxy statement/prospectus is timely provided to RMG III warrant
holders. See the section entitled “Warrant Holder Proposal No. 2—The Warrant Holders Adjournment Proposal.”
|
Q:
|
WHY IS RMG III PROPOSING THE BUSINESS COMBINATION?
|
A:
|
RMG III was organized to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar
business combination with one or more businesses.
|
Q:
|
DID THE RMG III BOARD OBTAIN A THIRD-PARTY VALUATION OR FAIRNESS OPINION IN DETERMINING WHETHER OR NOT TO
PROCEED WITH THE MERGER?
|
A:
|
The RMG III Board did not obtain a fairness opinion or a third-party valuation from an independent investment banking firm or
another independent firm with respect to the Business Combination. RMG III is not required to obtain a third-party opinion that the price it is paying is fair to RMG III from a financial point of view. The RMG III Board has
substantial experience in evaluating the financial merits of companies from a wide range of industries, including the clean energy technology and renewable energy sector, and has concluded that its experience and the backgrounds of
its members enabled it to make the necessary analyses and determinations regarding the Business Combination with H2B2. The factors and information considered by the RMG III Board, as further described under the section titled “The Business Combination — The RMG III Board’s Reasons for Approval of the Merger,” include estimates of potential addressable green hydrogen markets, the terms of the Merger
Agreement, the projected future performance of H2B2 in calendar years 2023, 2024 and 2025, the potential investments by third-party investors participating in the Capital Raise Transaction and other relevant financial information
selected based on the business experience and professional judgment of RMG III’s management. In addition, the RMG III Board and RMG III’s management have substantial experience with mergers and acquisitions. Accordingly, investors
will be relying solely on the judgment of the RMG III Board in valuing H2B2’s business, and assuming the risk that the RMG III Board may not have properly valued the Business Combination.
|
Q:
|
WHY IS RMG III PROVIDING RMG III SHAREHOLDERS WITH THE OPPORTUNITY TO VOTE ON THE BUSINESS COMBINATION?
|
A:
|
We are seeking approval of the Business Combination for purposes of complying with applicable Nasdaq listing rules requiring
shareholder approval of issuances of more than 20% of a listed company’s issued and outstanding ordinary shares. In addition, pursuant to the RMG III Governing Documents, we must provide all Public Shareholders with the opportunity to
redeem all or a portion of their Public Shares upon the consummation of an initial business combination (as defined in our RMG III Governing Documents) either in conjunction with a tender offer or in conjunction with an RMG III
shareholder vote to approve such initial business combination. If we submit the Business Combination to RMG III shareholders for their approval, our RMG III Governing Documents require us to conduct a redemption offer in conjunction
with the proxy solicitation.
|
Q:
|
WHY IS RMG III PROVIDING RMG III WARRANT HOLDERS WITH THE OPPORTUNITY TO VOTE ON THE WARRANT AMENDMENT?
|
A:
|
We are seeking approval of the Warrant Amendment, which will amend the Warrant Agreement to provide that, at Closing, each of
the then outstanding Domesticated RMG III Warrants will be canceled and exchanged for the right to receive up to 0.075 shares of Surviving Corporation Common Stock.
|
Q:
|
WHAT ARE THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE WARRANT AMENDMENT?
|
A:
|
As discussed more fully under “U.S. Federal Income Tax Considerations,” it is expected
that, for U.S. federal income tax purposes, the Warrant Amendment will be treated as a tax-free “recapitalization.” As a result of such treatment, U.S. Holders (as defined in “U.S. Federal Income Tax
Considerations”) of RMG III Warrants will generally not recognize gain or loss for U.S. federal income tax purposes on the Warrant Amendment.
|
Q:
|
HAVE THE H2B2 STOCKHOLDERS APPROVED THE BUSINESS COMBINATION?
|
A:
|
Yes. A special meeting of the H2B2 Stockholders was held on June 19, 2023, at which the H2B2 Stockholder Approval was obtained
with 91.782% of the H2B2 Stockholders voting in favor of adopting the Merger Agreement and the transactions contemplated thereby.
|
Q:
|
DO I HAVE REDEMPTION RIGHTS?
|
A:
|
If you are a holder of Public Shares, you have the right to demand that RMG III redeem such shares for a pro rata portion of the
cash held in the Trust Account as of two business days prior to the consummation of the transactions contemplated by the Business Combination Proposal upon the Closing.
|
Q:
|
WILL MY VOTE AFFECT MY ABILITY TO EXERCISE REDEMPTION RIGHTS?
|
A:
|
No. You may exercise your redemption rights whether you vote for or against, or abstain from voting on, any or all of the
Proposals. As a result, the Condition Precedent Proposals can be approved by Public Shareholders who will redeem their Public Shares and no longer remain RMG III shareholders and the Merger may be consummated even though the funds
available from the Trust Account and the number of Public Shareholders are substantially reduced as a result of redemptions by Public Shareholders.
|
Q:
|
HOW DO I EXERCISE MY REDEMPTION RIGHTS?
|
A:
|
If you are a Public Shareholder and wish to exercise your redemption rights, you must demand that RMG III redeem your shares
for cash no later than the second business day preceding the Special Meeting by delivering or tendering your shares (and share certificates (if any) and other redemption forms) to Continental physically or electronically using the
DTC’s DWAC system. Any holder of Public Shares will be entitled to demand that such holder’s Public Shares be redeemed for a pro rata portion of the amount then in the Trust Account. Such amount, including interest earned, if any, on
the funds held in the Trust Account and not previously released to RMG III to pay its taxes, will be paid promptly upon consummation of the Merger. However, under Delaware law, the proceeds held in the Trust Account could be subject
to claims that could take priority over those of the Public Shareholders exercising redemption rights, regardless of whether such holders vote for or against the Business Combination Proposal. Therefore, the per Public Share
distribution from the Trust Account in such a situation may be less than originally anticipated due to such claims. Your vote on any Proposal will have no impact on the amount you will receive upon exercise of your redemption rights.
|
Q:
|
WHAT ARE THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF EXERCISING MY REDEMPTION RIGHTS?
|
A:
|
In most circumstances, it is expected that a U.S. Holder (as defined in “U.S. Federal Income
Tax Considerations”) that exercises its redemption rights to receive cash from the Trust Account in exchange for its RMG III Class A Ordinary Shares will be treated as selling such ordinary shares resulting in the recognition
of capital gain or capital loss. There may be certain circumstances, however, in which the redemption may be treated as a distribution for U.S. federal income tax purposes depending on the amount of RMG III Class A Ordinary Shares that
such U.S. Holder owns or is deemed to own under certain constructive attribution rules (including through the ownership of RMG III Warrants). For a more complete discussion of the U.S. federal income tax considerations of an exercise of
redemption rights, see “U.S. Federal Income Tax Considerations.”
|
Q:
|
DO I HAVE APPRAISAL OR DISSENTERS’ RIGHTS IF I OBJECT TO THE PROPOSED BUSINESS COMBINATION?
|
A:
|
No. None of the RMG III shareholders, holders of RMG III Units or RMG III warrant holders have appraisal rights in connection
with the Business Combination or the Domestication under the DGCL. None of the RMG III shareholders have dissenters’ rights in connection with the Business Combination or the Domestication under Cayman Islands law. See the section
entitled “Appraisal Rights and Dissenters’ Rights.”
|
Q:
|
WHAT HAPPENS TO THE FUNDS DEPOSITED IN THE TRUST ACCOUNT AFTER CONSUMMATION OF THE BUSINESS COMBINATION?
|
A:
|
Following the closing of the Initial Public Offering, the net proceeds from the Initial Public Offering and the sale of the RMG
III Private Placement Warrants were placed in the Trust Account. In connection with the approval of the First Extension Amendment in January 2023, and the approval of the Second Extension Amendment in August 2023, Public Shareholders
elected to redeem an aggregate of 47,664,222 Public Shares, representing approximately 98.7% of the issued and outstanding Public Shares. As of immediately following redemptions made in connection with the Second Extension Amendment,
there was $6,619,681 in the Trust Account.
|
Q:
|
WHAT UNDERWRITING FEES ARE PAYABLE IN CONNECTION WITH THE BUSINESS COMBINATION?
|
A:
|
In connection with the Initial Public Offering, RMG III entered into the Underwriting Agreement with the IPO Underwriters.
Pursuant to the Underwriting Agreement, the IPO Underwriters were entitled to an aggregate deferred underwriting commission of $16,905,000 upon the consummation of the Business Combination, payable from the amounts held in the Trust
Account. In April 2023, each of the IPO Underwriters waived its respective entitlement to the payment of any deferred underwriting commission with respect to the Business Combination.
|
Q:
|
WHAT HAPPENS IF THE MERGER IS NOT CONSUMMATED?
|
A:
|
If RMG III does not complete the Merger with H2B2 for whatever reason, RMG III may choose to search for another target business
with which to complete a business combination. If RMG III does not complete the Merger with H2B2 or a business combination with another target business within the Completion Window, RMG III must redeem 100% of the outstanding Public
Shares, at a per Public Share price, payable in cash, equal to the amount then held in the Trust Account including interest earned, if any, on the funds held in the Trust Account and not previously released to RMG III to pay taxes and
expenses relating to the administration of the trust account or as limited withdrawals by RMG III to fund its working capital requirements (less up to $100,000 of interest to pay dissolution expenses) divided by the number of
outstanding Public Shares. The Initial Shareholders have no redemption rights in the event a business combination is not effected in the Completion Window, and, accordingly, their Founder Shares will be worthless. Additionally, in the
event of such liquidation, there will be no distribution with respect to outstanding RMG III Warrants. Accordingly, the RMG III Warrants will expire worthless.
|
Q:
|
HOW DOES THE SPONSOR INTEND TO VOTE ON THE PROPOSALS?
|
A:
|
As of the date of this proxy statement/prospectus, and due to the redemption of 47,664,222 Public Shares in aggregate in
connection with the RMG III shareholder vote in January 2023 and in August 2023, to approve the extension of the date by which RMG III must complete an initial business combination, the Sponsor owns approximately 95.0% of the issued and
outstanding RMG III Ordinary Shares, consisting of the Founder Shares. The Sponsor has agreed to vote any RMG III Ordinary Shares held by it as of the RMG III Record Date in favor of each of the Proposals presented at the Special
Meeting.
|
Q:
|
WHAT CONSTITUTES A QUORUM AT THE SPECIAL MEETING?
|
A:
|
A quorum will be present at the Special Meeting if the holders of a majority of the issued and outstanding RMG III Ordinary
Shares entitled to vote at the Special Meeting are represented in person (which would include presence at a virtual meeting) or by proxy. Abstentions and broker non-votes will be counted as
|
Q:
|
WHAT VOTE IS REQUIRED TO APPROVE EACH PROPOSAL AT THE SPECIAL MEETING?
|
A:
|
The following votes are required for each proposal at the Special Meeting:
|
•
|
The Business Combination Proposal: The Business Combination Proposal may be approved by
an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the Special Meeting.
The Initial Shareholders and their permitted transferees have agreed to vote their shares in favor of each of the Proposals. As a result, the affirmative vote of any of the Public Shares is not required to approve the Business
Combination Proposal.
|
•
|
The Domestication Proposal: The approval of the Domestication Proposal requires a
special resolution under Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the Special
Meeting. The Initial Shareholders and their permitted transferees have agreed to vote their shares in favor of each of the Proposals. As a result, the affirmative vote of any of the Public Shares is not required to approve the
Domestication Proposal.
|
•
|
The Organizational Documents Proposals: The separate approval of each of the
Organizational Documents Proposals requires a special resolution under Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the RMG III Ordinary Shares represented in person or by proxy and entitled to
vote thereon and who vote at the Special Meeting. The Initial Shareholders and their permitted transferees have agreed to vote their shares in favor of each of the Proposals. As a result, the affirmative vote of any of the Public Shares
is not required to approve each of the Organizational Documents Proposals.
|
•
|
The Director Election Proposal: The Director Election Proposal may be approved by an
ordinary resolution of the holders of the RMG III Class B Ordinary Shares under Cayman Islands law, being the affirmative vote of the holders of a majority of the RMG III Class B Ordinary Shares represented in person or by proxy and
entitled to vote thereon and who vote at the Special Meeting. The Initial Shareholders and their permitted transferees have agreed to vote their shares in favor of each of the Proposals. As a result, the affirmative vote of any of the
Public Shares is not required to approve the Director Election Proposal.
|
•
|
The Stock Issuance Proposal: The Stock Issuance Proposal may be approved by an ordinary
resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the Special Meeting. The Initial
Shareholders and their permitted transferees have agreed to vote their shares in favor of each of the Proposals. As a result, the affirmative vote of any of the Public Shares is not required to approve the Stock Issuance Proposal.
|
•
|
The Equity Incentive Plan Proposal: The Equity Incentive Plan Proposal may be approved
by an ordinary resolution under Cayman Islands law, being the affirmative vote of a majority of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the Special Meeting. The Initial
Shareholders and their permitted transferees have agreed to vote their shares in favor of each of the Proposals. As a result, the affirmative vote of any of the Public Shares is not required to approve the Equity Incentive Plan
Proposal.
|
•
|
The Adjournment Proposal: The Adjournment Proposal may be approved by an ordinary
resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the Special Meeting. The Initial
Shareholders and their permitted transferees have agreed to vote their shares in favor of each of the Proposals. As a result, the affirmative vote of any of the Public Shares is not required to approve the Adjournment Proposal.
|
Q:
|
WHAT CONSTITUTES A QUORUM AT THE WARRANT HOLDERS MEETING?
|
A:
|
A quorum will be present at the Warrant Holders Meeting if the holders of at least 50% of the outstanding RMG III Warrants are
represented in person (which would include presence at a virtual meeting) or by proxy. Abstentions and broker non-votes will be counted as present for the purpose of determining a quorum. As of the RMG III Record Date, RMG III
Warrants would be required to achieve a quorum. In the absence of a quorum, the chairman of the Warrant Holders Meeting has power to adjourn the Warrant Holders Meeting. The Initial Shareholders own 100% of the outstanding RMG III
Private Placement Warrants and none of the RMG III Public Warrants. Accordingly, it is expected that the RMG III Public Warrants and RMG III Private Placement Warrants held by the Initial Shareholders will be sufficient to establish a
quorum.
|
Q:
|
WHAT VOTE IS REQUIRED TO APPROVE EACH PROPOSAL AT THE WARRANT HOLDERS MEETING?
|
A:
|
The following votes are required for each proposal at the Warrant Holders Meeting:
|
•
|
The Warrant Amendment Proposal: The approval of the Warrant Amendment Proposal requires
the affirmative vote of the holders of at least 65% of each of (i) the then outstanding RMG III Public Warrants and (ii) the then outstanding RMG III Private Placement Warrants, each voting separately as a class. Abstentions and broker
non-votes, while considered present for purposes of establishing quorum, will count as a vote “AGAINST” the Warrant Amendment Proposal. The Initial Shareholders own 100% of the outstanding RMG III Private Placement Warrants and none of
the RMG III Public Warrants. Accordingly, it is expected that the RMG III Private Placement Warrants held by the Initial Shareholders will be voted in favor of the Warrant Amendment Proposal and only the affirmative vote of at least 65%
of the outstanding RMG III Public Warrants represented in person or by proxy and entitled to vote thereon and who vote at the Warrant Holders Meeting will be required to approve the Warrant Amendment Proposal. The RMG III Warrants will
expire worthless if RMG III does not consummate an initial business combination by the Completion Window.
|
•
|
The Warrant Holders Adjournment Proposal: The Warrant Holders Adjournment Proposal may
be approved by the affirmative vote of the holders of at least 50% of the RMG III Warrants represented in person or by proxy and entitled to vote thereon and who vote at the Warrant Holders Meeting. Abstentions and broker non-votes,
while considered present for the purposes of establishing a quorum, will not count as votes cast on the Warrant Holders Adjournment Proposal at the Warrant Holders Meeting. The Initial Shareholders own 100% of the outstanding RMG III
Private Placement Warrants and none of the RMG III Public Warrants. Accordingly, it is expected that the RMG III Private Placement Warrants held by the Initial Shareholders will be voted in favor of the Warrant Amendment Proposal and
such proposal will not require any affirmative votes of the outstanding RMG III Public Warrants represented in person or by proxy and entitled to vote thereon and who vote at the Warrant Holders Meeting to approve the Warrant Holders
Adjournment Proposal.
|
Q:
|
HOW DOES THE SPONSOR INTEND TO VOTE ON THE WARRANT HOLDER PROPOSALS?
|
A:
|
As of the date of this proxy statement/prospectus, the Initial Shareholders own 100% of the outstanding RMG III Private
Placement Warrants and none of the RMG III Public Warrants. The Initial Shareholders intend to vote any shares of RMG III Warrants held by them as of the RMG III Record Date in favor of each of the Proposals presented at the Warrant
Holders Meeting.
|
Q:
|
DO ANY OF RMG III’S DIRECTORS OR OFFICERS OR THE SPONSOR OR ITS AFFILIATES HAVE INTERESTS IN THE BUSINESS
COMBINATION THAT MAY DIFFER FROM OR BE IN ADDITION TO THE INTERESTS OF RMG III SHAREHOLDERS OR THE RMG III WARRANT HOLDERS?
|
A:
|
Certain of RMG III’s executive officers and certain non-employee directors, as well as the Sponsor and its affiliates, may have
interests in the Merger that may be different from, or in addition to, the interests of RMG III shareholders and the RMG III warrant holders generally. These interests include, among other things:
|
•
|
The Sponsor paid an aggregate of $12,349,495 for its purchases of the Founder Shares and the RMG III Private Placement Warrants.
Prior to the Initial Public Offering, the Sponsor purchased 10,062,500 Founder Shares for an aggregate purchase price of $25,000. Subsequently, RMG III effectuated a 5-for-6 share split of the RMG III Class B Ordinary Shares, resulting
in an aggregate outstanding amount of 12,075,000 Founder Shares outstanding. Simultaneously with the consummation of the Initial Public Offering, the Sponsor purchased 8,216,330 RMG III Private Placement Warrants for an aggregate
purchase price of $12,324,495 in a private placement. A portion of the proceeds from the sale of the RMG III Private Placement Warrants were added to the net proceeds from the Initial Public Offering held in the Trust Account. If the
Business Combination with H2B2 or another business combination is not consummated within the Completion Window, RMG III will cease all operations except for the purpose of winding up, redeeming the outstanding Public Shares for cash
and, subject to the approval of its remaining RMG III shareholders and the RMG III Board, dissolving and liquidating. In such event, the 12,075,000 Founder Shares held by the Initial Shareholders would be worthless because the Initial
Shareholders are not entitled to participate in any redemption or distribution with respect to such shares. Additionally, in such event, the 8,216,330 RMG III Private Placement Warrants will also expire worthless. The Founder Shares had
an aggregate market value of $ based upon the closing price of $ per share of RMG III Class A Ordinary Shares on Nasdaq on the RMG III Record Date. The RMG III Private Placement Warrants had an aggregate market value of
approximately $ based upon the closing price of $ per Public Warrant on the Nasdaq on the RMG III Record Date.
|
•
|
In order to finance transaction costs in connection with a business combination, the Sponsor, members of the RMG III founding
team or any of their affiliates may, but are not obligated to (other than pursuant to the January 2022 Note and the July 2022 Note), make certain working capital loans as may be required. On January 19, 2022, RMG Acquisition
Management, agreed to lend RMG III up to an aggregate of $500,000 for working capital purposes, pursuant to the January 2022 Note, an unsecured, non-interest bearing promissory note. The January 2022 Note is due and payable in full by
RMG III upon the consummation of a business combination. On July 27, 2022, RMG Acquisition Management agreed to lend RMG III up to an aggregate of $475,000 for working capital purposes, pursuant to the July 2022 Note, an unsecured,
non-interest bearing promissory note. The July 2022 Note is due and payable in full by RMG III upon the consummation of a business combination. In the event that the Business Combination does not close, RMG III may use a portion of
proceeds held outside the Trust Account to repay the January 2022 Note and the July 2022 Note, but no proceeds held in the Trust Account would be used to repay the January 2022 Note and the July 2022 Note. The January 2022 Note and
the July 2022 Note will be repaid in cash upon consummation of the Business Combination. As of the date hereof, RMG III has borrowed $500,000 under the January 2022 Note and $350,000 under the July 2022 Note. If RMG III does not
complete a business combination by the end of the Completion Window, there will not be sufficient assets to repay the outstanding balance under the January 2022 Note and the July 2022 Note, and the January 2022 Note and the July 2022
Note will be worthless.
|
•
|
There will be no finder’s fees, reimbursements or cash payments made by RMG III to the Sponsor or RMG III’s officers or
directors, or RMG III’s or any of their affiliates, for services rendered to RMG III prior to or in connection with the completion of the Business Combination, other than payment of the amount for office space, utilities,
administrative and support services and repayments of any outstanding balance of the January 2022 Note and the July 2022 Note, as described above. RMG III’s directors and officers and their affiliates are entitled to reimbursement of
out-of-pocket expenses incurred by them in connection with certain activities on RMG III’s behalf, such as identifying and investigating possible business targets and business combinations. There is no cap or ceiling on the
reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on RMG III’s behalf. However, if RMG III fails to consummate a business combination by the end of the Completion Window, RMG III’s
directors and officers will not have any claim against the Trust Account for reimbursement. Accordingly, RMG III may not be able to reimburse these expenses if the Business Combination or another business combination is not
consummated within the Completion Window. As of , 2024, $ was outstanding in out-of-pocket expense reimbursements. Additionally, under the Administrative Services Agreement, RMG Acquisition Management is entitled to $20,000
per month for office space, utilities and administrative and support services provided to
|
•
|
RMG III’s existing directors and officers will be eligible for continued indemnification and continued coverage under RMG III’s
directors’ and officers’ liability insurance after the Business Combination pursuant to the Merger Agreement.
|
•
|
In the event of the liquidation of the Trust Account, the Sponsor has agreed, under the Letter Agreement, dated February 4,
2021, among RMG III, the Sponsor and RMG III’s officers and directors, to indemnify and hold harmless RMG III against any and all losses, liabilities, claims, damages and expenses to which RMG III may become subject as a result of any
claim by (i) any third party for services rendered or products sold to RMG III or (ii) a prospective target business with which RMG III has entered into an acquisition agreement; provided that such indemnification of RMG III by the
Sponsor will apply only to the extent necessary to ensure that such claims by a third party for services rendered or products sold to RMG III or a target do not reduce the amount of funds in the Trust Account to below (i) $10.00 per
share of RMG III Class A Ordinary Shares or (ii) such lesser amount per RMG III Class A Ordinary Share held in the Trust Account due to reductions in the value of the trust assets as of the date of the liquidation of the Trust Account,
in each case, net of the amount of interest earned on the property in the Trust Account, which may be withdrawn to pay taxes, expenses related to the administration of the Trust Account and limited withdrawals for working capital,
except as to any claims by a third party (including a target) who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under RMG III’s indemnity of the IPO Underwriters against certain
liabilities, including liabilities under the Securities Act. If RMG III consummates the Business Combination, on the other hand, RMG III will be liable for all such claims.
|
•
|
Pursuant to the Sponsor Support Agreement, the Sponsor has agreed to, subject to certain exceptions, among other things, vote in
favor of the Merger Agreement and the transactions contemplated thereby, in each case, subject to the terms and conditions contemplated by the Sponsor Support Agreement.
|
•
|
Subject to certain limited exceptions, the Surviving Corporation Common Stock will not be transferable following the Closing
until the date that is 180 days after the Closing.
|
•
|
The Sponsor (including RMG III’s directors, officers and Initial Shareholders and their permitted transferees) owns RMG III
Private Placement Warrants which, in the event the Warrant Amendment Proposal is approved prior to the Effective Time, will be converted into the right to receive up to 0.075 shares of Surviving Corporation Common Stock per RMG III
Private Placement Warrant.
|
•
|
Certain of RMG III’s officers and directors presently have, and any of them in the future may have additional, fiduciary or
contractual obligations to other entities pursuant to which such officer or director is or will be required to present business combination opportunities to such entity. Accordingly, in the future, if any of RMG III’s officers or
directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations
to present such opportunity to such entity. RMG III does not believe, however, that any fiduciary duties or contractual obligations of its officers or directors would materially undermine RMG III’s ability to complete a business
combination. The Existing Articles provide that RMG III renounces any interest or expectancy in, or in being offered, any corporate opportunity offered to any director or officer, but no director or officer of RMG III has any duty,
except and to the extent expressly assumed by contract, to communicate or offer any such corporate opportunity to RMG III and will not be in breach of any fiduciary duty as a director or officer solely by reason of fact that such party
pursues or acquires such corporate opportunity for itself, himself or herself, directs such corporate opportunity to another person, or does not communicate information regarding such corporate opportunity to
|
Q:
|
WHAT DO I NEED TO DO NOW?
|
A:
|
RMG III urges you to read and consider the information contained in this proxy statement/prospectus carefully, including the
annexes and the other documents referred to herein, and to consider how the Merger will affect you as an RMG III shareholder and/or RMG III warrant holder. RMG III shareholders and RMG III warrant holders should then vote as soon as
possible in accordance with the instructions provided in this proxy statement/prospectus and on the enclosed shareholder and/or warrant holder proxy card.
|
Q:
|
WHAT HAPPENS IF I SELL MY PUBLIC SHARES AND/OR RMG III PUBLIC WARRANTS BEFORE THE SPECIAL MEETINGS?
|
A:
|
The RMG III Record Date for the Special Meetings is earlier than the date that the Business Combination is expected to be
completed. If you transfer your Public Shares and/or RMG III Public Warrants after the RMG III Record Date but before the Special Meetings, unless the transferee obtains from you a proxy to vote those shares, you will retain your right
to vote at the Special Meetings. However, you will not be able to seek redemption of your Public Shares because you will no longer be able to tender them prior to the Special Meeting in accordance with the provisions described herein.
If you transferred your Public Shares and/or RMG III Public Warrants prior to the RMG III Record Date, you have no right to vote those shares at the Special Meetings or redeem those shares for a pro rata portion of the proceeds held in
the Trust Account.
|
Q:
|
HOW DO I VOTE?
|
A:
|
If you are a holder of record of Public Shares and/or RMG III Public Warrants on the RMG III Record Date, you may vote at the
Special Meetings in person (which would include presence at a virtual meeting) or by proxy. You may submit your proxy by completing, signing, dating and returning the enclosed shareholder and/or warrant holder proxy card in the
accompanying pre-addressed postage paid envelope. If you hold your shares and/or warrants in “street name,” which means your shares are held of record by a broker, bank or other nominee, you should contact your broker, bank or other
nominee to ensure that votes related to the shares and/or warrants you beneficially own are properly counted.
|
Q:
|
IF MY SHARES AND/OR WARRANTS ARE HELD IN “STREET NAME” BY A BROKER, BANK OR OTHER NOMINEE, WILL MY BROKER,
BANK OR OTHER NOMINEE VOTE MY SHARES AND/OR WARRANTS FOR ME?
|
A:
|
If your shares and/or warrants are held in “street name” in a stock brokerage account or by a broker, bank or other nominee, you
must provide the record holder of your shares and/or warrants with instructions on how to vote your shares and/or warrants. Please follow the voting instructions provided by your broker, bank or other nominee. Please note that you may
not vote shares and/or warrants held in “street name” by returning a proxy card directly to RMG III or by voting in person (which would include presence at a virtual meeting) at the Special Meetings unless you provide a “legal proxy,”
which you must obtain from your broker, bank or other nominee. Please submit your legal proxy to Continental at proxy@continentalstock.com in order to receive a control number to vote at the
virtual meeting.
|
Q:
|
WHAT IF I ATTEND THE SPECIAL MEETINGS AND ABSTAIN OR DO NOT VOTE?
|
A:
|
For purposes of the Special Meetings, an abstention occurs when an RMG III shareholder or a RMG III warrant holder attends
the meeting in person (which would include presence at a virtual meeting) and does not vote or returns a proxy with an “abstain” vote.
|
Q:
|
WHAT WILL HAPPEN IF I RETURN MY PROXY CARD WITHOUT INDICATING HOW TO VOTE?
|
A:
|
If you sign and return your proxy card without indicating how to vote on any particular Proposal, the RMG III Ordinary Shares
and/or RMG III Warrants represented by your proxy will be voted “FOR” each of the Proposals presented at the Special Meetings.
|
Q:
|
MAY I CHANGE MY VOTE AFTER I HAVE MAILED MY SIGNED PROXY CARD?
|
A:
|
Yes. If you are an RMG III shareholder of record, you may change your vote at any time before your proxy is exercised by
doing any one of the following:
|
•
|
sending another proxy card with a later date;
|
•
|
notifying RMG III’s Secretary in writing before the Special Meetings that you have revoked your proxy; or
|
•
|
attending the Special Meeting and/or the Warrant Holders Meeting and voting electronically by visiting and entering the
control number found on your proxy card, instruction form or notice you previously received.
|
Q:
|
WHAT HAPPENS IF I FAIL TO TAKE ANY ACTION WITH RESPECT TO THE SPECIAL MEETINGS?
|
A:
|
If you fail to take any action with respect to the Special Meeting and the Business Combination is approved by RMG III
shareholders and the Warrant Amendment is approved by RMG III warrant holders and the Business Combination is consummated, you will become a stockholder of the Surviving Corporation. Failure to take any action with respect to the
Special Meeting will not affect your ability to exercise your redemption rights. If you fail to take any action with respect to the Special Meeting and the Business Combination is not approved, you will continue to be an RMG III
shareholder and/or RMG III warrant holder while RMG III searches for another target business with which to complete a business combination.
|
Q:
|
WHAT SHOULD I DO IF I RECEIVE MORE THAN ONE SET OF VOTING MATERIALS?
|
A:
|
RMG III shareholders and RMG III warrant holders may receive more than one set of voting materials, including multiple copies of
this proxy statement/prospectus and multiple proxy cards or voting instruction cards. For example, if you hold your shares and/or warrants in more than one brokerage account, you will receive a separate voting instruction card for each
brokerage account in which you hold shares and/or warrants. If you are a holder of record and your shares and/or warrants are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and
return each proxy card and voting instruction card that you receive in order to cast a vote with respect to all of your RMG III Ordinary Shares and RMG III Warrants.
|
Q:
|
WHO CAN HELP ANSWER MY QUESTIONS?
|
A:
|
If you have questions about the Merger or if you need additional copies of the proxy statement/prospectus or the enclosed proxy
card you should contact:
|
(1)
|
Reflects 831,306 shares of H2B2 Common Stock held by H2B2 as Treasury Stock.
|
|
| |
Undiluted Share Ownership in the Surviving Corporation(1)
|
|||||||||||||||||||||||||||
|
| |
Pro Forma Combined
(Assuming No
Redemptions)
|
| |
Pro Forma Combined
(Assuming 25%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 50%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 75%
Redemptions)
|
| |
Pro Forma Combined
(Assuming Maximum
Redemptions)
|
|||||||||||||||
Stockholders
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
H2B2 Stockholders(2)
|
| |
40,000,000
|
| |
91.57%
|
| |
40,000,000
|
| |
91.93%
|
| |
40,000,000
|
| |
92.28%
|
| |
40,000,000
|
| |
92.65%
|
| |
40,000,000
|
| |
93.01%
|
Public Shareholders(3)
|
| |
635,778
|
| |
1.46%
|
| |
476,834
|
| |
1.10%
|
| |
317,889
|
| |
0.73%
|
| |
158,945
|
| |
0.37%
|
| |
—
|
| |
—
|
Sponsor(4)
|
| |
1,508,368
|
| |
3.45%
|
| |
1,498,223
|
| |
3.44%
|
| |
1,488,077
|
| |
3.43%
|
| |
1,477,932
|
| |
3.42%
|
| |
1,467,786
|
| |
3.41%
|
Other Stockholders(5)
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
RMG III Warrants
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Holders of RMG III Private Placement Warrants(6)
|
| |
616,225
|
| |
1.41%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.43%
|
| |
616,225
|
| |
1.43%
|
Holders of RMG III Public Warrants(7)
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.68%
|
| |
724,500
|
| |
1.67%
|
| |
724,500
|
| |
1.69%
|
Total Shares Outstanding
|
| |
43,682,371
|
| |
100.0%
|
| |
43,513,281
|
| |
100.0%
|
| |
43,344,191
|
| |
100.0%
|
| |
43,175,101
|
| |
100.0%
|
| |
43,006,011
|
| |
100.0%
|
Total Pro Forma Book Value
|
| |
54,238,482
|
| |
|
| |
52,569,565
|
| |
|
| |
50,900,648
|
| |
|
| |
49,231,730
|
| |
|
| |
47,583,287
|
| |
|
Pro Forma Book Value per Share Outstanding
|
| |
1.24
|
| |
|
| |
1.21
|
| |
|
| |
1.17
|
| |
|
| |
1.14
|
| |
|
| |
1.11
|
| |
|
(1)
|
Share ownership under each redemption scenario is only presented for illustrative purposes. RMG III cannot predict how many of
its Public Shareholders will exercise their right to have their Public Shares redeemed for cash. As a result, the RMG III Share Redemption Amount and the number of RMG III Class A Ordinary Shares redeemed in connection with the
Business Combination may differ from
|
(2)
|
Assumes that the Closing Date Purchase Price is $400,000,000.
|
(3)
|
Excludes 724,500 shares of Surviving Corporation Common Stock issuable in respect of any RMG III Public Warrants that may be
held by Public Shareholders pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(4)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 12,075,000 RMG III Class B Ordinary Shares held by
the Sponsor, as converted pursuant to the Merger Agreement, inclusive of the 255,319 shares of Surviving Corporation Common Stock issuable in respect of the Convertible Notes of $30.0 million. Excludes 616,225 shares of Surviving
Corporation Common Stock issuable in respect of the 8,216,330 RMG III Private Placement Warrants owned by the Sponsor pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(5)
|
Such shares of Surviving Corporation Common Stock issuable to Cohen for services provided in connection with the First
Extension and the 172,500 shares of Surviving Corporation Common Stock issuable in exchange of the Convertible Debt of $1.5 million with a conversion premium of 15%, as described elsewhere in this proxy statement/prospectus.
|
(6)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 8,216,330 RMG III Private Placement Warrants
pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(7)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 9,660,000 RMG III Public Warrants pursuant the
proposed terms of the Warrant Amendment, subject to change.
|
|
| |
Fully Diluted Share Ownership in the Surviving Corporation(1)(2)
|
|||||||||||||||||||||||||||
|
| |
Pro Forma Combined
(Assuming No
Redemptions)
|
| |
Pro Forma Combined
(Assuming 25%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 50%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 75%
Redemptions)
|
| |
Pro Forma Combined
(Assuming Maximum
Redemptions)
|
|||||||||||||||
Stockholders
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
H2B2 Stockholders(3)
|
| |
40,000,000
|
| |
91.57%
|
| |
40,000,000
|
| |
91.93%
|
| |
40,000,000
|
| |
92.28%
|
| |
40,000,000
|
| |
92.65%
|
| |
40,000,000
|
| |
93.01%
|
Public Shareholders(4)
|
| |
635,778
|
| |
1.46%
|
| |
476,834
|
| |
1.10%
|
| |
317,889
|
| |
0.73%
|
| |
158,945
|
| |
0.37%
|
| |
—
|
| |
—
|
Sponsor(5)
|
| |
1,508,368
|
| |
3.45%
|
| |
1,498,223
|
| |
3.44%
|
| |
1,488,077
|
| |
3.43%
|
| |
1,477,932
|
| |
3.42%
|
| |
1,467,786
|
| |
3.41%
|
Other stockholders(6)
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
RMG III Warrants
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Holders of RMG III Private Placement Warrants(7)
|
| |
616,225
|
| |
1.41%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.43%
|
| |
616,225
|
| |
1.43%
|
Holders of RMG III Public Warrants(8)
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.68%
|
| |
724,500
|
| |
1.67%
|
| |
724,500
|
| |
1.69%
|
Equity Incentive Plan
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Incentive Plan(9)
|
| | | | | | | | | | | | | | | | | | | | ||||||||||
Total Shares Outstanding
|
| |
43,682,371
|
| |
100.0%
|
| |
43,513,281
|
| |
100.0%
|
| |
43,344,191
|
| |
100.0%
|
| |
43,175,101
|
| |
100.0%
|
| |
43,006,011
|
| |
100.0%
|
Total Pro Forma Book Value
|
| |
54,238,482
|
| |
|
| |
52,569,565
|
| |
|
| |
50,900,648
|
| |
|
| |
49,231,730
|
| |
|
| |
47,583,287
|
| |
|
Pro Forma Book Value per Share Outstanding
|
| |
1.24
|
| |
|
| |
1.21
|
| |
|
| |
1.17
|
| |
|
| |
1.14
|
| |
|
| |
1.11
|
| |
|
(1)
|
Share ownership under each redemption scenario is only presented for illustrative purposes. RMG III cannot predict how many of
its Public Shareholders will exercise their right to have their Public Shares redeemed for cash. As a result, the RMG III Share Redemption Amount and the number of RMG III Class A Ordinary Shares redeemed in connection with the
Business Combination may differ from the amounts presented above. As such, the ownership percentages of H2B2 Stockholders, Public Shareholders, Sponsor, Holders of RMG III Public Warrants, and other stockholders may also differ from
the presentation above if the actual redemptions are different from these assumptions.
|
(2)
|
This presentation includes shares that may be issued but are not presently outstanding and, as such, differ from the share
counts shown or assumed in the sections entitled “Summary Unaudited Pro Forma Condensed Combined Financial Information” and “Unaudited Pro Forma Condensed
Combined Financial Information,” which sections are limited to shares that are presently issued and outstanding.
|
(3)
|
Assumes that the Closing Date Purchase Price is $400,000,000.
|
(4)
|
Excludes 724,500 shares of Surviving Corporation Common Stock issuable in respect of any RMG III Public Warrants that may be
held by Public Shareholders pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(5)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 12,075,000 RMG III Class B Ordinary Shares held by
the Sponsor, as converted pursuant to the Merger Agreement, inclusive of the 255,319 shares of Surviving Corporation Common Stock issuable in respect of the Convertible Notes of $30.0 million. Excludes 616,225 shares of Surviving
Corporation Common Stock issuable in respect of the 8,216,330 RMG III Private Placement Warrants owned by the Sponsor pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(6)
|
Such shares of Surviving Corporation Common Stock issuable to Cohen for services provided in connection with the First
Extension and the 172,500 shares of Surviving Corporation Common Stock issuable in exchange of the Convertible Debt of $1.5 million with a conversion premium of 15%, as described elsewhere in this proxy statement/prospectus.
|
(7)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 8,216,330 RMG III Private Placement Warrants
pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(8)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 9,660,000 RMG III Public Warrants pursuant the
proposed terms of the Warrant Amendment, subject to change.
|
(9)
|
Such shares of Surviving Corporation Common Stock expected to be reserved under the Incentive Plan (assuming the Equity
Incentive Plan Proposal is approved).
|
|
| |
Undiluted Share Ownership in the Surviving Corporation(1)
|
|||||||||||||||||||||||||||
|
| |
Pro Forma Combined
(Assuming No
Redemptions)
|
| |
Pro Forma Combined
(Assuming 25%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 50%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 75%
Redemptions)
|
| |
Pro Forma Combined
(Assuming Maximum
Redemptions)
|
|||||||||||||||
Stockholders
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
H2B2 Stockholders(2)
|
| |
40,000,000
|
| |
91.57%
|
| |
40,000,000
|
| |
91.93%
|
| |
40,000,000
|
| |
92.28%
|
| |
40,000,000
|
| |
92.65%
|
| |
40,000,000
|
| |
93.01%
|
Public Shareholders(3)
|
| |
635,778
|
| |
1.46%
|
| |
476,834
|
| |
1.10%
|
| |
317,889
|
| |
0.73%
|
| |
158,945
|
| |
0.37%
|
| |
—
|
| |
—
|
Sponsor(4)
|
| |
1,508,368
|
| |
3.45%
|
| |
1,498,223
|
| |
3.44%
|
| |
1,488,077
|
| |
3.43%
|
| |
1,477,932
|
| |
3.42%
|
| |
1,467,786
|
| |
3.41%
|
Other Stockholders(5)
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
RMG III Warrants
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Holders of RMG III Private Placement Warrants(6)
|
| |
616,225
|
| |
1.41%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.43%
|
| |
616,225
|
| |
1.43%
|
Holders of RMG III Public Warrants(7)
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.68%
|
| |
724,500
|
| |
1.67%
|
| |
724,500
|
| |
1.69%
|
Total Shares Outstanding
|
| |
43,682,371
|
| |
100.0%
|
| |
43,513,281
|
| |
100.0%
|
| |
43,344,191
|
| |
100.0%
|
| |
43,175,101
|
| |
100.0%
|
| |
43,006,011
|
| |
100.0%
|
Total Pro Forma Book Value
|
| |
54,238,482
|
| |
|
| |
52,569,565
|
| |
|
| |
50,900,648
|
| |
|
| |
49,231,730
|
| |
|
| |
47,583,287
|
| |
|
Pro Forma Book Value per Share Outstanding
|
| |
1.24
|
| |
|
| |
1.21
|
| |
|
| |
1.17
|
| |
|
| |
1.14
|
| |
|
| |
1.11
|
| |
|
(1)
|
Share ownership under each redemption scenario is only presented for illustrative purposes. RMG III cannot predict how many of
its Public Shareholders will exercise their right to have their Public Shares redeemed for cash. As a result, the RMG III Share Redemption Amount and the number of RMG III Class A Ordinary Shares redeemed in connection with the
Business Combination may differ from the amounts presented above. As such, the ownership percentages of H2B2 Stockholders, Public Shareholders, Sponsor, Holders of RMG III Public Warrants, and other stockholders may also differ from
the presentation above if the actual redemptions are different from these assumptions.
|
(2)
|
Assumes that the Closing Date Purchase Price is $400,000,000.
|
(3)
|
Excludes 724,500 shares of Surviving Corporation Common Stock issuable in respect of any RMG III Public Warrants that may be
held by Public Shareholders pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(4)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 12,075,000 RMG III Class B Ordinary Shares held by
the Sponsor, as converted pursuant to the Merger Agreement, inclusive of the 255,319 shares of Surviving Corporation Common Stock issuable in respect of the Convertible Notes of $30.0 million. Excludes 616,225 shares of Surviving
Corporation Common Stock issuable in respect of the 8,216,330 RMG III Private Placement Warrants owned by the Sponsor pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(5)
|
Such shares of Surviving Corporation Common Stock issuable to Cohen for services provided in connection with the First
Extension and the 172,500 shares of Surviving Corporation Common Stock issuable in exchange of the Convertible Debt of $1.5 million with a conversion premium of 15%, as described elsewhere in this proxy statement/prospectus.
|
(6)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 8,216,330 RMG III Private Placement Warrants
pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(7)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 9,660,000 RMG III Public Warrants pursuant the
proposed terms of the Warrant Amendment, subject to change.
|
|
| |
Fully Diluted Share Ownership in the Surviving Corporation(1)(2)
|
|||||||||||||||||||||||||||
|
| |
Pro Forma Combined
(Assuming No
Redemptions)
|
| |
Pro Forma Combined
(Assuming 25%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 50%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 75%
Redemptions)
|
| |
Pro Forma Combined
(Assuming Maximum
Redemptions)
|
|||||||||||||||
Stockholders
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
H2B2 Stockholders(3)
|
| |
40,000,000
|
| |
91.57%
|
| |
40,000,000
|
| |
91.93%
|
| |
40,000,000
|
| |
92.28%
|
| |
40,000,000
|
| |
92.65%
|
| |
40,000,000
|
| |
93.01%
|
Public Shareholders(4)
|
| |
635,778
|
| |
1.46%
|
| |
476,834
|
| |
1.10%
|
| |
317,889
|
| |
0.73%
|
| |
158,945
|
| |
0.37%
|
| |
—
|
| |
—
|
Sponsor(5)
|
| |
1,508,368
|
| |
3.45%
|
| |
1,498,223
|
| |
3.44%
|
| |
1,488,077
|
| |
3.43%
|
| |
1,477,932
|
| |
3.42%
|
| |
1,467,786
|
| |
3.41%
|
Other stockholders(6)
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
| |
197,500
|
| |
0.46%
|
RMG III Warrants
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Holders of RMG III Private Placement Warrants(7)
|
| |
616,225
|
| |
1.41%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.42%
|
| |
616,225
|
| |
1.43%
|
| |
616,225
|
| |
1.43%
|
Holders of RMG III Public Warrants(8)
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.68%
|
| |
724,500
|
| |
1.67%
|
| |
724,500
|
| |
1.69%
|
|
| |
Fully Diluted Share Ownership in the Surviving Corporation(1)(2)
|
|||||||||||||||||||||||||||
|
| |
Pro Forma Combined
(Assuming No
Redemptions)
|
| |
Pro Forma Combined
(Assuming 25%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 50%
Redemptions)
|
| |
Pro Forma Combined
(Assuming 75%
Redemptions)
|
| |
Pro Forma Combined
(Assuming Maximum
Redemptions)
|
|||||||||||||||
Stockholders
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
Equity Incentive Plan
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Incentive Plan(9)
|
| | | | | | | | | | | | | | | | | | | | ||||||||||
Total Shares Outstanding
|
| |
43,682,371
|
| |
100.0%
|
| |
43,513,281
|
| |
100.0%
|
| |
43,344,191
|
| |
100.0%
|
| |
43,175,101
|
| |
100.0%
|
| |
43,006,011
|
| |
100.0%
|
Total Pro Forma Book Value
|
| |
54,238,482
|
| |
|
| |
52,569,565
|
| |
|
| |
50,900,648
|
| |
|
| |
49,231,730
|
| |
|
| |
47,583,287
|
| |
|
Pro Forma Book Value per Share Outstanding
|
| |
1.24
|
| |
|
| |
1.21
|
| |
|
| |
1.17
|
| |
|
| |
1.14
|
| |
|
| |
1.11
|
| |
|
(1)
|
Share ownership under each redemption scenario is only presented for illustrative purposes. RMG III cannot predict how many of
its Public Shareholders will exercise their right to have their Public Shares redeemed for cash. As a result, the RMG III Share Redemption Amount and the number of RMG III Class A Ordinary Shares redeemed in connection with the
Business Combination may differ from the amounts presented above. As such, the ownership percentages of H2B2 Stockholders, Public Shareholders, Sponsor, Holders of RMG III Public Warrants, and other stockholders may also differ from
the presentation above if the actual redemptions are different from these assumptions.
|
(2)
|
This presentation includes shares that may be issued but are not presently outstanding and, as such, differ from the share
counts shown or assumed in the sections entitled “Summary Unaudited Pro Forma Condensed Combined Financial Information” and “Unaudited Pro Forma Condensed
Combined Financial Information,” which sections are limited to shares that are presently issued and outstanding.
|
(3)
|
Assumes that the Closing Date Purchase Price is $400,000,000.
|
(4)
|
Excludes 724,500 shares of Surviving Corporation Common Stock issuable in respect of any RMG III Public Warrants that may be
held by Public Shareholders pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(5)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 12,075,000 RMG III Class B Ordinary Shares held by
the Sponsor, as converted pursuant to the Merger Agreement, inclusive of the 255,319 shares of Surviving Corporation Common Stock issuable in respect of the Convertible Notes of $30.0 million. Excludes 616,225 shares of Surviving
Corporation Common Stock issuable in respect of the 8,216,330 RMG III Private Placement Warrants owned by the Sponsor pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(6)
|
Such shares of Surviving Corporation Common Stock issuable to Cohen for services provided in connection with the First
Extension and the 172,500 shares of Surviving Corporation Common Stock issuable in exchange of the Convertible Debt of $1.5 million with a conversion premium of 15%, as described elsewhere in this proxy statement/prospectus.
|
(7)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 8,216,330 RMG III Private Placement Warrants
pursuant the proposed terms of the Warrant Amendment, subject to change.
|
(8)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 9,660,000 RMG III Public Warrants pursuant the
proposed terms of the Warrant Amendment, subject to change.
|
(9)
|
Such shares of Surviving Corporation Common Stock expected to be reserved under the Incentive Plan (assuming the Equity
Incentive Plan Proposal is approved).
|
•
|
The Business Combination Proposal: The Business Combination
Proposal may be approved by an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who
vote at the Special Meeting.
|
•
|
The Domestication Proposal: The Domestication Proposal requires a
special resolution under Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the Special
Meeting.
|
•
|
The Organizational Documents Proposals: The separate approval of
each of the Organizational Documents Proposals requires a special resolution under Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the RMG III Ordinary Shares represented in person or by proxy
and entitled to vote thereon and who vote at the Special Meeting.
|
•
|
The Director Election Proposal: The Director Election Proposal may
be approved by an ordinary resolution of the holders of the RMG III Class B Ordinary Shares under Cayman Islands law, being the affirmative vote of the holders of a majority of the RMG III Class B Ordinary Shares represented in person
or by proxy and entitled to vote thereon and who vote at the Special Meeting.
|
•
|
The Stock Issuance Proposal: The Stock Issuance Proposal may be
approved by an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the
Special Meeting.
|
•
|
The Equity Incentive Plan Proposal: The Equity Incentive Plan
Proposal may be approved by an ordinary resolution under Cayman Islands law, being the affirmative vote of a majority of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the
Special Meeting.
|
•
|
The Adjournment Proposal: The Adjournment Proposal may be approved
by an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the RMG III Ordinary Shares represented in person or by proxy and entitled to vote thereon and who vote at the Special
Meeting.
|
(a)
|
hold Public Shares or if you hold Public Shares through RMG III Units, you elect to separate your RMG III Units into the
underlying Public Shares and RMG III Public Warrants prior to exercising your redemption rights with respect to the Public Shares;
|
(b)
|
submit a written request to Continental, RMG III’s transfer agent, that RMG III redeem all or a portion of your Public Shares
for cash; and
|
(c)
|
tender or deliver your Public Shares (and share certificates (if any) and other redemption forms) to Continental, RMG III’s
transfer agent, electronically through DTC.
|
•
|
The Warrant Amendment Proposal: The Warrant Amendment Proposal may be approved by an affirmative vote of the holders of at
least 65% of each of (i) the then outstanding RMG III Public Warrants and (ii) the then outstanding RMG III Private Placement Warrants, each voting separately as a class.
|
•
|
The Warrant Holders Adjournment Proposal: The Adjournment Proposal may be approved by an affirmative vote of at least 50% of
the holders of the RMG III Warrants represented in person or by proxy and entitled to vote thereon and who vote at the Warrant Holders Meeting.
|
•
|
The Sponsor paid an aggregate of $12,349,495 for its purchases of the Founder Shares and the RMG III Private Placement
Warrants. Prior to the Initial Public Offering, the Sponsor purchased 10,062,500 Founder Shares for an aggregate purchase price of $25,000. Subsequently, RMG III effectuated a 5-for-6 share split of the RMG III Class B Ordinary
Shares, resulting in an aggregate outstanding amount of 12,075,000 Founder Shares outstanding. Simultaneously with the consummation of the Initial Public Offering, the Sponsor purchased 8,216,330 RMG III Private Placement Warrants for
an aggregate purchase price of $12,324,495 in a private placement. A portion of the proceeds from the sale of the RMG III Private Placement Warrants was added to the net proceeds from the Initial Public Offering held in the Trust
Account. If the Business Combination with H2B2 or another business combination is not consummated within the Completion Window, RMG III will cease all operations except for the purpose of winding up, redeeming the outstanding Public
Shares for cash and, subject to the approval of the remaining RMG III shareholders and the RMG III Board, dissolving and liquidating. In such event, the 12,075,000 Founder Shares held by the Initial Shareholders would be worthless
because the Initial Shareholders are not entitled to participate in any redemption or distribution with respect to such shares. Additionally, in such event, the 8,216,330 RMG III Private Placement Warrants will also expire worthless.
The Founder Shares had an aggregate market value of $ based upon the closing price of $ per share of RMG III Class A Ordinary Shares on Nasdaq on the RMG III Record Date. The RMG III Private Placement Warrants had an aggregate
market value of approximately $ based upon the closing price of $ per Public Warrant on the Nasdaq on the RMG III Record Date.
|
•
|
In order to finance transaction costs in connection with a business combination, the Sponsor, members of the RMG III
founding team or any of their affiliates may, but are not obligated to (other than pursuant to the January 2022 Note and the July 2022 Note), make certain working capital loans as may be required. On January 19, 2022, RMG
Acquisition Management, agreed to lend RMG III up to an aggregate of $500,000 for working capital purposes, pursuant to the January 2022 Note, an unsecured, non-interest bearing promissory note. The January 2022 Note is due and
payable in full by RMG III upon the consummation of a business combination. On July 27, 2022, RMG Acquisition Management agreed to lend RMG III up to an aggregate of $475,000 for working capital purposes, pursuant to the July 2022
Note, an unsecured, non-interest bearing promissory note. The July 2022 Note is due and payable in full by RMG III upon the consummation of a business combination. In the event that the Business Combination does not close, RMG III
may use a portion of proceeds held outside the Trust Account to repay the January 2022 Note and the July 2022 Note, but no proceeds held in the Trust Account would be used to repay the January 2022 Note and the July 2022 Note. The
January 2022 Note and the July 2022 Note will be repaid in cash upon consummation of the Business Combination. As of the date hereof, RMG III has borrowed $500,000 under the January 2022 Note and $350,000 under the July 2022 Note.
If RMG III does not complete a business combination by the end of the Completion Window, there will not be sufficient assets to repay the outstanding balance under the January 2022 Note and the July 2022 Note, and the January 2022
Note and the July 2022 Note will be worthless.
|
•
|
There will be no finder’s fees, reimbursements or cash payments made by RMG III to the Sponsor or RMG III’s officers or
directors, or RMG III’s or any of their affiliates, for services rendered to RMG III prior to or in connection with the completion of the Business Combination, other than payment of the amount for office space, utilities and
administrative and support services and repayments of any outstanding balance of the January 2022 Note and the July 2022 Note, as described above. RMG III’s directors and officers and their affiliates are entitled to reimbursement of
out-of-pocket expenses incurred by them in connection with certain activities on RMG III’s behalf, such as identifying and investigating possible business targets and business combinations. There is no cap or ceiling on the
reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on RMG III’s behalf. However, if RMG III fails to consummate a business combination by the end of the Completion Window, RMG III’s
directors and officers will not have any claim
|
•
|
RMG III’s existing directors and officers will be eligible for continued indemnification and continued coverage under RMG
III’s directors’ and officers’ liability insurance after the Business Combination pursuant to the Merger Agreement.
|
•
|
In the event of the liquidation of the Trust Account, the Sponsor has agreed, under the Letter Agreement, dated February 4,
2021, among RMG III, the Sponsor and RMG III’s officers and directors, to indemnify and hold harmless RMG III against any and all losses, liabilities, claims, damages and expenses to which RMG III may become subject as a result of any
claim by (i) any third party for services rendered or products sold to RMG III or (ii) a prospective target business with which RMG III has entered into an acquisition agreement; provided that such indemnification of RMG III by the
Sponsor will apply only to the extent necessary to ensure that such claims by a third party for services rendered or products sold to RMG III or a target do not reduce the amount of funds in the Trust Account to below (i) $10.00 per
share of RMG III Class A Ordinary Shares or (ii) such lesser amount per RMG III Class A Ordinary Share held in the Trust Account due to reductions in the value of the trust assets as of the date of the liquidation of the Trust
Account, in each case, net of the amount of interest earned on the property in the Trust Account, which may be withdrawn to pay taxes, expenses related to the administration of the Trust Account and limited withdrawals for working
capital, except as to any claims by a third party (including a target) who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under RMG III’s indemnity of the IPO Underwriters
against certain liabilities, including liabilities under the Securities Act. If RMG III consummates the Business Combination, on the other hand, RMG III will be liable for all such claims.
|
•
|
Pursuant to the Sponsor Support Agreement, the Sponsor has agreed to, subject to certain exceptions, among other things, vote
in favor of the Merger Agreement and the transactions contemplated thereby, in each case, subject to the terms and conditions contemplated by the Sponsor Support Agreement.
|
•
|
Subject to certain limited exceptions, the Surviving Corporation Common Stock held by the Sponsor will not be transferable
following the Closing until the date that is 180 days after the Closing.
|
•
|
The Sponsor (including RMG III’s directors, officers and Initial Shareholders and their permitted transferees) owns RMG III
Private Placement Warrants which, in the event the Warrant Amendment Proposal is approved prior to the Effective Time, will be converted into the right to receive up to 0.075 shares of Surviving Corporation Common Stock per RMG III
Private Placement Warrant.
|
•
|
Certain of RMG III’s officers and directors presently have, and any of them in the future may have additional, fiduciary or
contractual obligations to other entities pursuant to which such officer or director is or will be required to present business combination opportunities to such entity. Accordingly, in the future, if any of RMG III’s officers or
directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual
obligations to present such opportunity to such entity. RMG III does not believe, however, that any fiduciary duties or contractual obligations of its officers or directors would materially undermine RMG III’s ability to complete a
business combination. The Existing Articles provide that RMG III renounces any interest or expectancy in, or in being offered, any corporate opportunity offered to any director or officer, but no director or officer of RMG III has any
duty, except and to the extent expressly assumed by contract, to communicate or offer any such corporate opportunity to RMG III and shall not be in breach of any
|
Sources
|
| |
|
| |
Uses
|
| |
|
($ in thousands)
|
| |
|
| |
|
| |
|
RMG III Cash*
|
| |
$6,966
|
| |
Transaction Accounting Costs***
|
| |
$19,325
|
Cash from H2B2
|
| |
$11,535
|
| |
Cash to Balance Sheet
|
| |
$26,301
|
Cash from convertible debt**
|
| |
$27,125
|
| |
|
| |
|
Total Sources
|
| |
$45,626
|
| |
Total Uses
|
| |
$45,626
|
Sources
|
| |
|
| |
Uses
|
| |
|
($ in thousands)
|
| |
|
| |
|
| |
|
RMG III Cash*
|
| |
$6,966
|
| |
Transaction Accounting Costs***
|
| |
$19,325
|
Cash from H2B2
|
| |
$11,535
|
| |
Cash to Balance Sheet
|
| |
$19,645
|
Cash from convertible debt**
|
| |
$27,125
|
| |
Maximum Right’s Redemption
|
| |
$6,655
|
Total Sources
|
| |
$45,626
|
| |
Total Uses
|
| |
$45,626
|
*
|
The amount of RMG III Cash reflects the amount in RMG III’s Trust Account and RMG III’s cash on the balance sheet, each as
of September 30, 2023.
|
**
|
See Footnotes (4) to the Unaudited Pro Forma Combined Balance Sheet as of September 30, 2023 included as part of the section
entitled “Unaudited Pro Forma Combined Financial Information” for further detail.
|
***
|
See the Footnotes to the Unaudited Pro Forma Combined Balance Sheet as of September 30, 2023 included as part of the section
entitled “Unaudited Pro Forma Combined Financial Information” for further detail.
|
•
|
Base Purchase Price. The definition of Base Purchase Price was removed.
|
•
|
Closing Date Purchase Price. The definition of Closing Date Purchase Price
was amended to a fixed purchase price of $400,000,000.
|
•
|
AVR Option Amount. All references to the AVR Option Amount were removed
from the calculation of the Closing Date Purchase Price and Minimum Investment Amount.
|
•
|
Minimum Investment Amount. The Minimum Investment Amount was reduced from
$40,000,000 to $30,000,000.
|
•
|
10% Premium. The ten percent (10%) premium to the Closing Date Purchase
Price in the event that the Capital Raise Amount exceeded $15,000,000 was removed from the definition of Closing Date Purchase Price (which became a fixed purchase price of $400,000,000).
|
•
|
Minimum Net Tangible Assets Condition. The condition precedent to
closing of the Merger that RMG III will have at least $5,000,001 of net tangible assets upon closing of the Merger (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) was removed.
|
•
|
Conversion of RMG III Class B Ordinary Shares. The definition of Founder
Consideration Shares and other related sections of the Merger Agreement were amended to reflect the planned partial conversion by Sponsor of certain RMG III Class B Ordinary Shares into RMG III Class A Ordinary Shares prior to
closing of the Merger.
|
•
|
Warrant Amendment. The covenant relating to the Warrant Amendment was
amended to clarify that RMG III will, following its execution, cause, in connection with the Closing, each of the then outstanding Public Warrants and Private Placement Warrants to represent the right to receive up to 0.075 shares
of Surviving Corporation Common Stock.
|
•
|
Director Nominees. The covenant relating to the composition of the
Surviving Corporation Board was amended to provide that, immediately following the Effective Time, the Surviving Corporation Board will consist of nine (9) directors, which will initially include (i) six (6) director nominees, each
of whom will be independent directors for the purposes of Nasdaq, (x) five (5) of whom will be designated by H2B2 and (y) one (1) of whom will be designated by RMG III, in each case by written notice to the other party as soon as
reasonably practicable following the date of the Merger Agreement and (ii) three (3) director nominees to be designated by H2B2.
|
•
|
H2B2 is an early-stage company with a history of losses and expects to incur significant expenses and continuing losses for
several years. H2B2 has yet to achieve positive operating cash flow and, given its projected funding needs, its ability to generate positive cash flow is uncertain.
|
•
|
H2B2’s limited operating history makes evaluating its business and future prospects difficult and may increase the risk of
your investment.
|
•
|
H2B2’s business, financial condition, results of operations, cash flow and prospects depend on the level of development and
production activity in the hydrogen industry.
|
•
|
The growth of H2B2’s business depends upon sourcing new projects and its ability to continue to take pipeline projects to
completion.
|
•
|
H2B2 faces risks and uncertainties when developing electrolyzers and green hydrogen projects and it may fail to
successfully deliver electrolyzers and other services of sufficient quality, on schedule and at scale which may result in delayed or canceled payment, increased costs, termination of customer contracts, reputation damage and
deteriorating customer relationships.
|
•
|
H2B2 may be unable to develop effective new technologies for hydrogen production, or to obtain, protect, or enforce its rights
in its existing proprietary technology now or in the future, which may impact its ability to compete in the green hydrogen industry.
|
•
|
The markets for electrolysis solutions and green hydrogen are emerging markets and their development is dependent on the
development of a commercialized market for green hydrogen, broad decarbonization efforts, an increase of renewable energy production and technological development of end-user applications of green hydrogen, which will require
continuous long-term outside investments and is subject to general macroeconomic conditions.
|
•
|
The green hydrogen market is dependent on specific changes to regulations and policies that have not yet been developed.
|
•
|
H2B2’s products have not been on the market for the full length of their expected lifetime and its products may not maintain
the performance standards that H2B2 and its customers are expecting.
|
•
|
The development, construction, maintenance and operation of H2B2’s projects require governmental and other regulatory
approvals and permits, including environmental approvals and permits.
|
•
|
H2B2 currently owns or has interests in, and in the future may acquire, certain assets in which it has limited control over
management decisions, including through joint ventures, and its interests in such assets may be subject to transfer or other related restrictions.
|
•
|
Errors may occur in H2B2’s assembly and production processes, as well as in connection with installation, operation and
maintenance, which could cause its electrolyzers to be defective or flawed or impact its hydrogen product facilities.
|
•
|
H2B2’s EPC operations, as well as its warranties and guarantees, expose it to certain risks, including any unexpected warranty
and production guarantee claims.
|
•
|
Changes in technology, including any rise in the popularity of alternatives to green hydrogen, may render H2B2’s technologies
obsolete and there is no guarantee that newly developed technologies that H2B2 invests in will perform as anticipated.
|
•
|
The green hydrogen market is subject to global competition from both established multinational conglomerates and low-cost
electrolyzer producers.
|
•
|
Green hydrogen has not yet reached price parity with fossil fuels and derived energy carriers, which is critical for the
commercialization of green hydrogen, and it may not reach price parity in the foreseeable future or at all.
|
•
|
H2B2 faces growing competition from traditional and renewable energy companies in developing hydrogen energy projects.
|
•
|
H2B2 may not be able to benefit from synergies from localized green hydrogen “hubs” or “Hydrogen Valleys” to the same extent
as its competitors.
|
•
|
Attractive offtake terms may become unavailable, or H2B2’s offtakers may be unable or unwilling to fulfill or renew their
contractual obligations with H2B2, which would adversely affect its business and growth.
|
•
|
H2B2 has determined that its continuing operating losses and negative cash flows from operations raises substantial doubt
about its ability to continue as a “going concern.”
|
•
|
H2B2 has identified certain material weaknesses in its internal control over financial reporting. If H2B2 is unable to
develop and maintain an effective system of internal controls and procedures required by Section 404(a) of the Sarbanes-Oxley Act, it may not be able to accurately report its financial results in a timely manner, which may adversely
affect investor confidence in H2B2 and materially and adversely affect its stock price, business and operating results.
|
•
|
H2B2’s projects depend, and will depend, on third-party service providers to deliver high-quality products at prices similar
to historical levels.
|
•
|
Failure of third parties to manufacture quality products or provide reliable services in a timely manner could cause delays in
developing and operating H2B2’s projects, which could adversely affect H2B2’s partner relationships or adversely affect its growth.
|
•
|
H2B2’s projects and the industry in which it operates are highly regulated and may be adversely affected by legislative or
regulatory changes or a failure to comply with energy regulations.
|
•
|
Green hydrogen markets may face a rapidly evolving regulatory framework, which replaces or alters existing regulatory
frameworks, and the dynamics of green hydrogen markets and electrolyzer markets may be changed significantly as a result thereof.
|
•
|
Amendments to, or the enactment of, local and international laws and regulations, and industry standards that address data
security and privacy, regarding the collection, distribution, use, security and storage of information, including personal information and confidential information.
|
•
|
H2B2 may not be able to obtain, or agree on, acceptable terms and conditions for government grants, loans and other incentives
for which H2B2 may apply.
|
•
|
Economic conditions in the EU and Spain could have a material adverse effect on H2B2’s business, financial condition, results
of operations, cash flow and prospects.
|
•
|
The market price of shares of Surviving Corporation Common Stock may be volatile or may decline regardless of the Surviving
Corporation’s operating performance. You may lose some or all of your investment.
|
•
|
The Surviving Corporation does not intend to pay dividends on Surviving Corporation Common Stock for the foreseeable future.
|
•
|
If securities or industry analysts do not publish research or reports about the Surviving Corporation’s business or the
Business Combination or publish negative reports, the market price of Surviving Corporation Common Stock could decline.
|
•
|
The Surviving Corporation’s ability to timely raise capital in the future may be limited, or may be unavailable on acceptable
terms, if at all. The Surviving Corporation’s failure to raise capital when needed could harm its business, operating results and financial condition. Debt issued to raise additional capital may reduce the value of Surviving
Corporation Common Stock.
|
•
|
The issuance of additional shares of Surviving Corporation Common Stock or convertible securities could make it difficult for
another company to acquire the Surviving Corporation, may dilute your ownership of the Surviving Corporation and could adversely affect the price of Surviving Corporation Common Stock.
|
•
|
Future resales of Surviving Corporation Common Stock after the consummation of the Business Combination may cause the market
price of the Surviving Corporation’s securities to drop significantly, even if the Surviving Corporation’s business is doing well.
|
•
|
The Surviving Corporation will be an “emerging growth company.” The reduced public company reporting requirements applicable
to emerging growth companies may make Surviving Corporation Common Stock less attractive to investors.
|
•
|
The Surviving Corporation’s management has limited experience in operating a public company.
|
•
|
The market price of shares of Surviving Corporation Common Stock after the Business Combination may be affected by factors
different from those currently affecting the prices of Public Shares.
|
•
|
There can be no assurance that Surviving Corporation Common Stock will be approved for listing on Nasdaq or that Surviving
Corporation Common Stock will be able to comply with the continued listing standards of Nasdaq.
|
•
|
The consummation of the Business Combination is subject to a number of conditions and if those conditions are not satisfied or
waived, the Merger Agreement may be terminated in accordance with its terms and the Business Combination may not be completed.
|
•
|
H2B2 will be subject to business uncertainties and contractual restrictions while the Business Combination is pending.
|
•
|
RMG III directors and officers may have interests in the Business Combination different from the interests of Public
Shareholders and Public Warrant holders.
|
•
|
The Sponsor has interests in the Business Combination different from the interests of Public Shareholders and Public Warrant
holders.
|
•
|
RMG III has not obtained a third-party valuation or a fairness opinion from an independent investment banking firm or another
independent firm, and consequently, you may have no assurance from an independent source that the terms of the Business Combination are fair to RMG III or RMG III shareholders from a financial point of view.
|
•
|
Because H2B2 will become a publicly traded company through the Business Combination rather than an underwritten initial public
offering, the scope of due diligence conducted may be different from that conducted by an underwriter in an underwritten initial public offering.
|
•
|
The Business Combination will result in changes to the board of directors that may affect the Surviving Corporation’s
strategy.
|
•
|
The Merger Agreement contains provisions that limit RMG III from seeking an alternative business combination.
|
•
|
The unaudited pro forma condensed combined financial information included in this proxy statement/prospectus is preliminary
and the actual financial condition and results of operations after the Business Combination may differ materially.
|
•
|
RMG III and H2B2 will incur transaction costs in connection with the Business Combination.
|
•
|
RMG III shareholders will have their rights as RMG III shareholders governed by the Proposed Organizational Documents.
|
•
|
The Sponsor has agreed to vote in favor of each of the Proposals presented at the Special Meeting, regardless of how Public
Shareholders vote.
|
•
|
RMG III’s and H2B2’s ability to consummate the Business Combination, and the operations of the Surviving Corporation following
the Business Combination, may be materially adversely affected by COVID-19.
|
•
|
If third parties bring claims against RMG III, the proceeds held in the Trust Account could be reduced and the per share
redemption amount received by RMG III shareholders may be less than $10.00 per share.
|
•
|
Public Shareholders who redeem their RMG III Class A Ordinary Shares may continue to hold any RMG III Public Warrants they
own, which would result in additional dilution to non-redeeming holders upon exercise of the RMG III Public Warrants.
|
•
|
RMG III’s independent directors may decide not to enforce the indemnification obligations of the Sponsor, resulting in a
reduction in the amount of funds in the Trust Account available for distribution to Public Shareholders.
|
•
|
There is no guarantee that a Public Shareholder’s decision whether to redeem their Public Shares for a pro rata portion of the
Trust Account will put such Public Shareholder in a better future economic position.
|
•
|
If Public Shareholders fail to comply with the redemption requirements specified in this proxy statement, they will not be
entitled to redeem their Public Shares for a pro rata portion of the funds held in the Trust Account.
|
•
|
If, before distributing the proceeds in the Trust Account to Public Shareholders, RMG III files a bankruptcy petition or an
involuntary bankruptcy petition is filed against RMG III that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of RMG III shareholders and the per share amount that would otherwise be
received by RMG III shareholders in connection with RMG III’s liquidation may be reduced.
|
•
|
If, after RMG III distributes the proceeds in the Trust Account to Public Shareholders, RMG III files a bankruptcy petition or
an involuntary bankruptcy petition is filed against RMG III that is not dismissed, a bankruptcy court may seek to recover such proceeds, and RMG III and the RMG III Board may be exposed to claims of punitive damages.
|
•
|
RMG III may redeem your unexpired RMG III Public Warrants prior to their exercise at a time that is disadvantageous to you,
thereby making your RMG III Public Warrants worthless, and the RMG III Private Placement Warrants have different cashless exercise rights than other warrants, including RMG III Public Warrants, issued by RMG III.
|
•
|
Subsequent to the consummation of the Business Combination, the Surviving Corporation may be required to take write-downs or
write-offs, or the Surviving Corporation may be subject to restructuring, impairment or other charges that could have a significant negative effect on the Surviving Corporation’s financial condition, results of operations and the
price of the Surviving Corporation’s securities, which could cause you to lose some or all of your investment.
|
•
|
Delaware law and the Proposed Organizational Documents contain certain provisions, including anti-takeover provisions, that
limit the ability of stockholders to take certain actions and could delay or discourage takeover attempts that stockholders may consider favorable.
|
•
|
If RMG III is not able to complete the Business Combination with H2B2 by the Completion Window and does not obtain an
additional extension, RMG III would be required to cease all operations except for the purpose of winding up and RMG III would redeem 100% of the Public Shares and liquidate the Trust Account, in which case the Public Shareholders
may only receive approximately $10.50 per share and the RMG III Warrants will expire worthless.
|
•
|
You will not have any rights or interests in funds from the Trust Account, except under certain limited circumstances. To
liquidate your investment, therefore, you may be forced to sell your Public Shares and/or RMG III Public Warrants, potentially at a loss.
|
•
|
If RMG III has not completed an initial business combination by the Completion Window or a valid extension thereof, Public
Shareholders may be forced to wait until such time redemption from the Trust Account is possible.
|
•
|
If the net proceeds of the Initial Public Offering not being held in the Trust Account are insufficient to allow RMG III to
operate through the Completion Window and RMG III is unable to obtain additional capital, RMG III may be unable to complete an initial business combination, in which case Public Shareholders may only receive $10.50 per share and the
RMG III Warrants will expire worthless.
|
•
|
The Domestication may result in adverse tax consequences for holders of RMG III Class A Ordinary Shares and RMG III Warrants.
|
|
| |
September 30,
2023
|
| |
December 31,
2022
|
|
| |
Unaudited
|
| |
|
Assets:
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash
|
| |
$310,838
|
| |
$22,339
|
Prepaid expenses
|
| |
51,374
|
| |
50,892
|
Total current assets
|
| |
362,212
|
| |
73,231
|
Cash and investments held in Trust Account
|
| |
6,655,195
|
| |
487,268,822
|
Total Assets
|
| |
$7,017,407
|
| |
$487,342,053
|
Liabilities, Class A Ordinary
Shares Subject to Possible Redemption and Shareholders’ Deficit:
|
| |
|
| |
|
Current liabilities:
|
| |
|
| |
|
Accounts payable
|
| |
$33,367
|
| |
$153,571
|
Accrued expenses
|
| |
7,600,457
|
| |
899,845
|
Accrued expenses - related party
|
| |
240,000
|
| |
120,000
|
Total current liabilities
|
| |
7,873,824
|
| |
1,173,416
|
Deferred legal fees
|
| |
250,000
|
| |
250,000
|
Deferred underwriting commissions
|
| |
6,762,000
|
| |
16,905,000
|
Convertible working capital loan - related party
|
| |
850,000
|
| |
500,000
|
Derivative warrant liabilities
|
| |
2,323,923
|
| |
536,300
|
Total liabilities
|
| |
18,059,747
|
| |
19,364,716
|
Commitments and Contingencies
|
| |
|
| |
|
Class A ordinary shares; 635,778 and 48,300,000
shares subject to possible redemption at $10.00 and $10.09 per share at September 30, 2023 and December 31, 2022, respectively
|
| |
6,357,780
|
| |
487,168,822
|
Shareholders’ Deficit:
|
| |
|
| |
|
Preference shares, $0.0001 par value; 5,000,000
shares authorized; none issued and outstanding at September 30, 2023 and December 31, 2022, respectively
|
| |
—
|
| |
—
|
Class A ordinary shares, $0.0001 par value;
500,000,000 shares authorized at September 30, 2023 and December 31, 2022, respectively
|
| |
—
|
| |
—
|
Class B ordinary shares, $0.0001 par value;
50,000,000 shares authorized; 12,075,000 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively
|
| |
1,208
|
| |
1,208
|
Additional paid-in capital
|
| |
9,585,984
|
| |
—
|
Accumulated deficit
|
| |
(26,987,312)
|
| |
(19,192,693)
|
Total shareholders’ deficit
|
| |
(17,400,120)
|
| |
(19,191,485)
|
Total Liabilities, Class A
Ordinary Shares Subject to Possible Redemption and Shareholders’ Deficit
|
| |
$7,017,407
|
| |
$487,342,053
|
|
| |
For the Three Months
Ended September 30,
|
| |
For the Nine Months
Ended September 30,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
General and administrative expenses
|
| |
$1,455,011
|
| |
$293,696
|
| |
$7,993,065
|
| |
$1,408,870
|
Loss from operations
|
| |
(1,455,011)
|
| |
(293,696)
|
| |
(7,993,065)
|
| |
(1,408,870)
|
Other income:
|
| |
|
| |
|
| |
|
| |
|
Change in fair value of derivative liabilities
|
| |
(355,739)
|
| |
(697,008)
|
| |
(1,787,623)
|
| |
12,181,745
|
Reduction in deferred underwriter commissions
|
| |
—
|
| |
—
|
| |
440,592
|
| |
—
|
Interest income - bank
|
| |
1,048
|
| |
—
|
| |
1,330
|
| |
—
|
Interest expense
|
| |
—
|
| |
(2,468)
|
| |
—
|
| |
(6,614)
|
Investment income earned on cash and investments held
in Trust Account
|
| |
63,138
|
| |
2,179,997
|
| |
1,562,977
|
| |
2,880,650
|
Total other (expense) income, net
|
| |
(291,553)
|
| |
1,480,521
|
| |
217,276
|
| |
15,055,781
|
Net (loss) income
|
| |
$(1,746,564)
|
| |
$1,186,825
|
| |
$(7,775,789)
|
| |
$13,646,911
|
Weighted average Class A ordinary shares, basic and
diluted
|
| |
743,298
|
| |
48,300,000
|
| |
2,768,541
|
| |
48,300,000
|
Basic and diluted net (loss)
income per ordinary share, Class A
|
| |
$(0.14)
|
| |
$0.02
|
| |
$(0.52)
|
| |
$0.23
|
Weighted average Class B ordinary shares, basic and
diluted
|
| |
12,075,000
|
| |
12,075,000
|
| |
12,075,000
|
| |
12,075,000
|
Basic and diluted net (loss)
income per ordinary share, Class B
|
| |
$(0.14)
|
| |
$0.02
|
| |
$(0.52)
|
| |
$0.23
|
|
| |
For the Nine Months Ended September 30,
|
|||
|
| |
2023
|
| |
2022
|
Cash Flows from Operating Activities:
|
| |
|
| |
|
Net (loss) income
|
| |
$(7,775,789)
|
| |
$13,646,911
|
Adjustments to reconcile net (loss) income to net
cash used in operating activities:
|
| |
|
| |
|
Change in fair value of derivative liabilities
|
| |
1,787,623
|
| |
(12,181,745)
|
Interest expense
|
| |
—
|
| |
6,614
|
Investment income earned on cash and investments held in Trust Account
|
| |
(1,562,977)
|
| |
(2,880,650)
|
Reduction in deferred underwriting commissions
|
| |
(440,592)
|
| |
—
|
Changes in operating assets and liabilities:
|
| |
|
| |
|
Prepaid expenses
|
| |
(482)
|
| |
400,249
|
Accounts payable
|
| |
(120,204)
|
| |
62,745
|
Accrued expenses - related party
|
| |
120,000
|
| |
60,000
|
Accrued expenses
|
| |
6,700,612
|
| |
351,153
|
Net cash used in operating activities
|
| |
(1,291,809)
|
| |
(534,723)
|
Cash Flows from Investing Activities:
|
| |
|
| |
|
Cash withdrawn from Trust Account for working capital purposes
|
| |
1,230,308
|
| |
27,010
|
Cash withdrawn from Trust Account in connection with redemption
|
| |
480,946,296
|
| |
—
|
Net cash provided by investing activities
|
| |
482,176,604
|
| |
27,010
|
Cash Flows from Financing Activities:
|
| |
|
| |
|
Proceeds from convertible promissory note - related party
|
| |
350,000
|
| |
500,000
|
Redemption of common stock
|
| |
(480,946,296)
|
| |
—
|
Net cash (used in) provided by financing activities
|
| |
(480,596,296)
|
| |
500,000
|
Net (decrease) increase in cash
|
| |
288,499
|
| |
(7,713)
|
Cash - beginning of the period
|
| |
22,339
|
| |
93,599
|
Cash - end of the period
|
| |
$310,838
|
| |
$85,886
|
Supplemental disclosure of non-cash investing and
financing activities:
|
| |
|
| |
|
Increase in value of Class A common stock subject to
possible redemption
|
| |
$135,254
|
| |
$2,765,952
|
Reduction in deferred underwriting fee payable
|
| |
$9,702,408
|
| |
—
|
|
| |
Three-month period
ended September 30,
|
| |
Nine-month period
ended September 30,
|
| |
Year ended
December 31,
|
|||||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
| |
2022
|
| |
2021
|
|
| |
(unaudited)
|
| |
(unaudited)
|
| |
|
| |
|
||||||
Product sales
|
| |
$765,272
|
| |
$408,999
|
| |
$7,932,684
|
| |
$1,646,000
|
| |
$3,491,673
|
| |
$961,607
|
Cost of sales
|
| |
706,042
|
| |
372,924
|
| |
7,924,701
|
| |
1,375,548
|
| |
3,042,412
|
| |
815,956
|
Gross profit
|
| |
59,230
|
| |
36,075
|
| |
7,983
|
| |
270,452
|
| |
449,261
|
| |
145,651
|
Operating expenses:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
723,436
|
| |
251,048
|
| |
1,894,644
|
| |
908,545
|
| |
1,333,961
|
| |
588,281
|
Selling, general and administrative
|
| |
2,883,447
|
| |
835,041
|
| |
7,403,238
|
| |
2,383,248
|
| |
3,904,132
|
| |
3,220,510
|
Depreciation and amortization of long-lived assets
|
| |
51,700
|
| |
38,576
|
| |
134,151
|
| |
49,332
|
| |
88,257
|
| |
24,178
|
Income from grants
|
| |
1,004,131
|
| |
113,748
|
| |
1,709,387
|
| |
530,903
|
| |
801,991
|
| |
242,170
|
Losses from unconsolidated investments
|
| |
(124,100)
|
| |
—
|
| |
(131,132)
|
| |
—
|
| |
—
|
| |
—
|
Loss from operations
|
| |
(2,719,322)
|
| |
(974,842)
|
| |
(7,845,795)
|
| |
(2,539,770)
|
| |
(4,075,098)
|
| |
(3,445,148)
|
Other income (expense):
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Other income
|
| |
—
|
| |
—
|
| |
326,203
|
| |
411,878
|
| |
411,878
|
| |
105,979
|
Interest and financial income (expense), net
|
| |
(159,424)
|
| |
(495,677)
|
| |
(341,332)
|
| |
(1,252,200)
|
| |
(557,112)
|
| |
(757,444)
|
Total other income (expense), net
|
| |
(159,424)
|
| |
(495,677)
|
| |
(15,129)
|
| |
(840,322)
|
| |
(145,233)
|
| |
(651,465)
|
Loss before income tax expense
|
| |
(2,878,746)
|
| |
(1,470,519)
|
| |
(7,860,924)
|
| |
(3,380,092)
|
| |
(4,220,331)
|
| |
(4,096,613)
|
Income tax expense
|
| |
22,764
|
| |
16,403
|
| |
69,884
|
| |
39,643
|
| |
76,128
|
| |
34,391
|
Net loss
|
| |
(2,901,510)
|
| |
(1,486,922)
|
| |
(7,930,808)
|
| |
(3,419,735)
|
| |
(4,296,459)
|
| |
(4,131,004)
|
Less: Net loss attributable to non-controlling
interests
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(253)
|
Net loss attributable to
Stockholders
|
| |
$(2,901,510)
|
| |
$(1,486,922)
|
| |
$(7,930,808)
|
| |
$(3,419,735)
|
| |
$(4,296,459)
|
| |
$(4,130,751)
|
Net loss per share:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Net loss per share – basic
|
| |
$(0.30)
|
| |
$(0.15)
|
| |
$(0.82)
|
| |
$(0.35)
|
| |
$(0.44)
|
| |
$(0.50)
|
Net loss per share – diluted
|
| |
$(0.30)
|
| |
$(0.15)
|
| |
$(0.82)
|
| |
$(0.35)
|
| |
$(0.44)
|
| |
$(0.50)
|
Weighted average shares outstanding – basic
|
| |
9,515,008
|
| |
9,729,856
|
| |
9,621,235
|
| |
9,732,972
|
| |
9,726,763
|
| |
8,321,904
|
Weighted average shares outstanding – diluted
|
| |
9,515,008
|
| |
9,729,856
|
| |
9,621,235
|
| |
9,732,972
|
| |
9,726,763
|
| |
8,321,904
|
|
| |
As of
|
||||||
|
| |
September 30, 2023
|
| |
December 31, 2022
|
| |
December 31, 2021
|
|
| |
(unaudited)
|
| |
|
| |
|
Total assets
|
| |
$36,546,097
|
| |
$25,185,188
|
| |
$17,446,766
|
Total liabilities
|
| |
51,504,826
|
| |
16,702,754
|
| |
4,607,604
|
Total equity
|
| |
(14,958,729)
|
| |
8,482,434
|
| |
12,839,162
|
Total liabilities and equity
|
| |
$36,546,097
|
| |
$25,185,188
|
| |
$17,446,766
|
|
| |
Nine-month period
ended September 30,
|
| |
Year ended
December 31,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2022
|
| |
2021
|
|
| |
(unaudited)
|
| |
|
| |
|
|||
Net cash (used in)/provided by:
|
| |
|
| |
|
| |
|
| |
|
Operating activities
|
| |
$1,428,427
|
| |
$(3,032,551)
|
| |
$(4,712,637)
|
| |
$(5,411,020)
|
Investing activities
|
| |
(5,651,351)
|
| |
(408,931)
|
| |
(1,240,429)
|
| |
(1,736,570)
|
Financing activities
|
| |
(10,583,576)
|
| |
(28,138)
|
| |
(20,230)
|
| |
9,014,233
|
Effect of exchange rate changes on cash and cash equivalents
|
| |
129,184
|
| |
(1,224,121)
|
| |
(526,836)
|
| |
(650,253)
|
(Decrease) increase in cash and cash equivalents
|
| |
$6,489,836
|
| |
$(4,693,741)
|
| |
$(6,500,132)
|
| |
$1,216,390
|
•
|
Scenario 1 — Assuming No Redemptions: This presentation assumes that no Public
Shareholders exercise redemption rights with respect to the remaining 635,778 Public Shares upon consummation of the Business Combination; and
|
•
|
Scenario 2 — Assuming Maximum Redemptions: This presentation assumes that
Public Shareholders exercise their redemption rights with respect to the remaining 635,778 Public Shares upon consummation of the Business Combination at a redemption price of approximately $10.50 per share, based on the amount held
in the Trust Account as of November 30, 2023. Scenario 2 includes all adjustments contained in Scenario 1 and presents additional adjustments to reflect the effect of maximum redemptions.
|
|
| |
Nine-month period
ended September 30, 2023
|
| |
Year ended
December 31, 2022
|
||||||
|
| |
Assuming No
Redemptions
|
| |
Assuming
Maximum
Redemptions
|
| |
Assuming No
Redemptions
|
| |
Assuming
Maximum
Redemptions
|
|
| |
(unaudited)
|
|||||||||
Net loss
|
| |
$(19,095,318)
|
| |
$ (19,095,318)
|
| |
$(22,213,192)
|
| |
$(22,213,192)
|
Weighted average shares outstanding, basic and
diluted
|
| |
43,682,371
|
| |
43,006,011
|
| |
43,682,371
|
| |
43,006,011
|
Basic and diluted earnings per share attributable to
equity holders of the parent
|
| |
(0.44)
|
| |
(0.44)
|
| |
(0.51)
|
| |
(0.52)
|
|
| |
As of September 30, 2023
|
|||
|
| |
Assuming No
Redemptions
|
| |
Assuming
Maximum
Redemptions
|
|
| |
(unaudited)
|
|||
Total assets
|
| |
$54,238,482
|
| |
$47,583,287
|
Total liabilities
|
| |
$79,932,076
|
| |
$79,932,076
|
Total shareholder’s deficit
|
| |
$(25,693,594)
|
| |
$(32,348,789)
|
•
|
Statements about the parties’ ability to consummate the Business Combination, including RMG III and H2B2 being able to receive
all required regulatory, third-party and shareholder approvals for the Business Combination, including RMG III warrant holder approval for the Warrant Amendment;
|
•
|
the anticipated benefits of the Business Combination, including the potential amount of cash that may be available to the
Surviving Corporation upon consummation of the proposed Business Combination and the use of the net proceeds following the Redemptions;
|
•
|
the anticipated timing of the Business Combination;
|
•
|
H2B2’s expectation that Surviving Corporation Common Stock will be accepted for listing on Nasdaq following the completion of
the proposed Business Combination;
|
•
|
H2B2’s history of losses and expectation to incur significant expenses and continuing losses for the foreseeable future;
|
•
|
H2B2’s limited operating history;
|
•
|
H2B2’s financial and business results depend on the level of development and production activity in the hydrogen industry;
|
•
|
H2B2’s ability to source new projects and its ability to continue to take pipeline projects to completion;
|
•
|
H2B2’s ability to develop and produce electrolyzers of sufficient quality, on a schedule and at scale;
|
•
|
the green hydrogen market’s growth, including the development of a commercialized market for green hydrogen, broad
decarbonization efforts, an increase of renewable energy production and development of end-user applications of green hydrogen;
|
•
|
public and private support for the green hydrogen market;
|
•
|
risks and uncertainties in developing green hydrogen projects, including failing to successfully deliver electrolyzers and other
services;
|
•
|
H2B2’s business, expansion plans and opportunities, including its ability to scale its operations and manage its future growth
effectively;
|
•
|
H2B2’s ability to secure governmental and other regulatory approvals and permits, including environmental approvals and permits;
|
•
|
construction, development, maintenance and operation of H2B2’s projects involves significant risks and hazards;
|
•
|
H2B2’s future capital requirements and sources and uses of cash;
|
•
|
risks associated with H2B2’s EPC operations, including warranties and production guarantees;
|
•
|
risks related to challenges H2B2 faces as a pioneer in the highly-competitive and rapidly-evolving green hydrogen industry;
|
•
|
the ability of H2B2 to keep up with technological advancements and develop new electrolyzer technologies;
|
•
|
operational challenges related to H2B2’s services;
|
•
|
H2B2’s ability to establish critical industrial partnerships with other electrolysis industry and green hydrogen market
stakeholders;
|
•
|
risks associated with offtake agreements, including sign offtake agreements with attractive offtake terms and offtakers
unwilling to fulfill their contractual obligations;
|
•
|
H2B2’s ability to attract and retain key personnel;
|
•
|
H2B2’s reliance on third-party service providers and suppliers;
|
•
|
disruptions in H2B2’s supply chain;
|
•
|
H2B2’s expectations regarding its ability to obtain and maintain intellectual property protection and not infringe on the rights
of others;
|
•
|
potential harm caused by misappropriation of H2B2’s data and compromises in cybersecurity;
|
•
|
litigation, regulatory proceedings, complaints, product liability claims and/or adverse publicity;
|
•
|
risk associated with H2B2 being subject to Spanish laws and regulations;
|
•
|
the possibility that H2B2 may be adversely affected by other economic, business and/or competitive factors;
|
•
|
the stability of the financial and capital markets;
|
•
|
RMG III and H2B2 being able to receive all required regulatory, third-party and shareholder approvals for the proposed Business
Combination;
|
•
|
the amount of Redemptions by Public Shareholders;
|
•
|
other current estimates and assumptions regarding the Business Combination and its benefits. Such expectations and assumptions
are inherently subject to uncertainties and contingencies regarding future events and, as such, are subject to change;
|
•
|
the amount of any Redemptions by existing holders of Public Shares being greater than expected, which may reduce the cash in
Trust Account available to H2B2 upon the consummation of the Business Combination;
|
•
|
the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement
and/or payment of the termination fees;
|
•
|
the outcome of any legal proceedings that may be instituted against H2B2 or RMG III following announcement of the Merger
Agreement;
|
•
|
the inability to consummate the Business Combination due to, among other things, the failure to obtain the RMG III Shareholder
Approval;
|
•
|
the risk that the announcement and consummation of the Business Combination disrupts H2B2’s current plans;
|
•
|
the ability to recognize the anticipated benefits of the Business Combination;
|
•
|
unexpected costs related to the Business Combination;
|
•
|
the risk that the consummation of the Business Combination is substantially delayed or does not occur, including prior to the
date on which RMG III is required to liquidate under the terms of the RMG III Governing Documents;
|
•
|
the effects of COVID-19 or other global health crises on H2B2’s business plans, financial condition and liquidity;
|
•
|
changes or disruptions in the securities markets;
|
•
|
legislative, political or economic developments;
|
•
|
the need to obtain permits and comply with laws and regulations and other regulatory requirements;
|
•
|
risks of accidents, equipment breakdowns, and labor disputes or other unanticipated difficulties or interruptions;
|
•
|
the possibility of cost overruns or unanticipated expenses in development programs;
|
•
|
potential future litigation; and
|
•
|
other factors detailed in the section titled “Risk Factors.”
|
•
|
the cost of producing and delivering hydrogen;
|
•
|
expectations regarding future energy prices;
|
•
|
level of worldwide production of hydrogen;
|
•
|
laws and regulations, including environmental protection laws and regulations and policies of governments pertaining to
hydrogen;
|
•
|
the development and exploitation of alternative products with similar capabilities, and the competitive, social and political
position of hydrogen;
|
•
|
local and international political and economic conditions;
|
•
|
technological change and development of energy sources that could potentially affect hydrogen’s relevance as an energy carrier;
and
|
•
|
political measures in response to climate change, including, but not limited to, subsidies on alternative energy sources,
taxation on emissions or limitations on the use of water for hydrogen production.
|
•
|
obtaining financeable land rights, including land rights for project sites that allow for eventual construction and operation
without undue burden, cost or interruption;
|
•
|
receiving required environmental, land-use, and construction and operation permits and approvals from government entities in a
timely manner and on reasonable terms;
|
•
|
avoiding or mitigating impacts to protected or endangered species or habitats, migratory birds, wetlands or other water
resources, and/or archaeological, historical or cultural resources;
|
•
|
securing necessary rights-of-way for access, as well as water rights and other necessary utilities for project construction and
operation;
|
•
|
completing construction on budget and on time.
|
•
|
our ability to secure necessary funding;
|
•
|
our ability to develop SOEC and AEM electrolyzers at scale and at attractive profit margins for our business;
|
•
|
our ability to negotiate and execute definitive agreements, and maintain arrangements on reasonable terms, with our various
suppliers for hardware, software or services necessary to engineer or manufacture parts or components of our electrolyzers;
|
•
|
securing necessary components, services or licenses on acceptable terms and in a timely manner;
|
•
|
delays by us in delivering final component designs to our suppliers;
|
•
|
quality controls, including within our production operations, which prove to be ineffective or inefficient;
|
•
|
defects in design and/or manufacture that cause our electrolyzers not to perform as expected or that require repair, recalls or
design changes;
|
•
|
delays, disruptions or increased costs in our, third-party outsourcing partners’ and our third-party suppliers’ supply chain,
including raw material supplies;
|
•
|
other delays, backlog in manufacturing and cost overruns in research and development of SOEC and AEM electrolyzers;
|
•
|
obtaining required regulatory approvals and certifications;
|
•
|
compliance with environmental, safety and similar regulations, as well as environmental and social governance obligations; and
|
•
|
our ability to attract, recruit, hire, retain and train skilled employees.
|
•
|
accurately prioritizing geographic markets for entry, including by making accurate estimates of addressable market demand;
|
•
|
identifying suitable projects;
|
•
|
participating in and winning hydrogen production facility or electrolyzer auctions on acceptable terms;
|
•
|
developing our projects on time, within budget and in compliance with regulatory requirements;
|
•
|
effectively tracking bid policies and bid updates;
|
•
|
obtaining cost effective financing needed to develop and construct projects;
|
•
|
efficiently sourcing components that meet our design specifications on schedule;
|
•
|
negotiating favorable payment terms with suppliers and contractors;
|
•
|
establishing or expanding design and manufacturing facilities;
|
•
|
managing regulatory requirements, permits and labor issues and controlling costs in connection with the construction of
additional projects or the expansion of existing projects;
|
•
|
continued availability of economic incentives and government investment initiatives along expected lines; and
|
•
|
signing PPAs or other offtake arrangements on commercially acceptable terms.
|
•
|
the level of development and production activity in the hydrogen industry;
|
•
|
our ability to source and develop new projects;
|
•
|
delays, increased costs or other unanticipated changes in contract performance that may affect profitability;
|
•
|
the number, type and significance of contracts commenced and completed during a quarter;
|
•
|
upfront investment cost in projects;
|
•
|
reductions in the prices of the solutions offered by our competitors; and
|
•
|
legislative and regulatory enforcement policy changes that may affect demand for our solutions.
|
•
|
timely implementation and satisfactory completion of construction;
|
•
|
obtaining and maintaining required governmental permits and approvals, including making appeals of, and satisfying obligations
in connection with, approvals obtained;
|
•
|
permit and litigation challenges from project stakeholders, including local residents, environmental organizations, labor
organizations, tribes and others who may oppose the project;
|
•
|
grants of injunctive relief to stop or prevent construction of a project in connection with any permit or litigation challenges
or non-compliance;
|
•
|
delivery of components related to the production of stacks, purification, dispensing, and hydrogen compressors, as well as
electrolyzers or energy storage systems on-budget and on-time;
|
•
|
discovery of unknown impacts to protected or endangered species or habitats, migratory birds, wetlands or other jurisdictional
water resources, and/or cultural resources at project sites;
|
•
|
discovery of title defects or environmental conditions that are not currently known, unforeseen engineering problems,
construction delays, contract performance shortfalls and work stoppages;
|
•
|
limited number of suppliers and material supply shortages, failures or disruptions of labor, equipment or supplies;
|
•
|
increases to labor costs beyond our expectation upon entering into construction agreements as a result of enhanced local or
national requirements regarding the use of union labor on-site, commercial pressures or settlements or the recently enacted IRA’s prevailing wage and apprenticeship requirements;
|
•
|
insolvency or financial distress on the part of our service providers, contractors or suppliers;
|
•
|
cost overruns and change orders;
|
•
|
cost or schedule impacts arising from changes in federal, state or local land-use or regulatory policies;
|
•
|
changes in electric utility procurement practices;
|
•
|
project delays that could adversely affect our ability to secure or maintain interconnection and transmission rights;
|
•
|
unfavorable tax treatment or adverse changes to tax policy;
|
•
|
adverse changes to government investment initiatives;
|
•
|
adverse environmental and geological or weather conditions, including water shortages and climate change, which may in some
cases limit our ability to produce hydrogen or force work stoppages due to the risk of heat, fire or other extreme weather events;
|
•
|
force majeure and other events outside of our control;
|
•
|
changes in laws affecting the project;
|
•
|
accidents on constructions sites; and
|
•
|
damage to consumers triggered by blackouts caused by damage to transmission infrastructure during construction.
|
•
|
increases in the price and availability of labor, equipment and materials;
|
•
|
inaccuracies of drawings and technical information;
|
•
|
delays in the delivery of equipment and materials to project sites;
|
•
|
unanticipated increases in equipment costs;
|
•
|
delays caused by local and seasonal weather conditions; and
|
•
|
any other unforeseen design and engineering issues or physical, site and geological conditions that may result in delays.
|
•
|
costs of renewable electricity, including tariffs and taxes on renewable electricity;
|
•
|
costs of investments in electrolyzers;
|
•
|
the availability of tax credits;
|
•
|
operating expenses of electrolysis systems; and
|
•
|
scarcity of water sources.
|
•
|
Events beyond our control or the control of an offtaker that may temporarily or permanently excuse the offtaker from its
obligation to accept and pay for delivery of energy generated by a project. These events could include a system emergency, a transmission failure or curtailment, adverse weather condition, a change in law, a change in permitting
requirements or conditions, or a labor dispute.
|
•
|
The ability of our offtakers to fulfill their contractual obligations to us depends on their creditworthiness. Due to the
long-term nature of our offtake contracts, we are exposed to the credit risk of our offtakers over an extended period of time. Any of these counterparties could become subject to insolvency or liquidation proceedings or otherwise
suffer a deterioration of its creditworthiness, including when it has not yet paid for energy delivered, any of which could result in a default under their agreements with us, and an insolvency or liquidation of any of these
counterparties could result in the termination of any applicable agreements with such counterparty.
|
•
|
The ability of any of our offtakers to extend, renew or replace its existing offtake contract with us depends on a number of
factors beyond our control, including: (i) whether the offtaker has a continued need for energy or capacity at the time of expiration, which could be affected by, among other things, the presence or absence of governmental incentives or
mandates, prevailing market prices or the availability of other energy sources; (ii) the satisfactory performance of our delivery obligations under such offtake contracts; (iii) the regulatory environment applicable to our offtakers at
the time; and (iv) macroeconomic factors present at the time, such as population, business trends and related energy demand.
|
•
|
conforming our electrolyzers and projects to various international regulatory requirements where our projects are designed,
developed, constructed, operated and maintained, which requirements may change over time;
|
•
|
expenditures related to foreign lawsuits and liability;
|
•
|
difficulties in staffing and managing foreign operations;
|
•
|
difficulties establishing relationships with, or disruption in the supply chain from, international suppliers;
|
•
|
difficulties attracting customers in new jurisdictions;
|
•
|
difficulties in attracting effective distributors, dealers or sales agents, as the case may be;
|
•
|
foreign government taxes, regulations and permit requirements, including foreign taxes that we may not be able to offset against
taxes imposed upon us in the United States, and foreign tax and other laws limiting our ability to repatriate funds to the United States;
|
•
|
fluctuations in foreign currency exchange rates and interest rates, including risks related to any foreign currency swap or
other hedging activities we undertake;
|
•
|
United States and foreign government trade restrictions, tariffs and price or exchange controls;
|
•
|
foreign labor laws, regulations and restrictions;
|
•
|
changes in diplomatic and trade relationships;
|
•
|
laws and business practices favoring local companies;
|
•
|
difficulties protecting or procuring intellectual property;
|
•
|
the adoption of our brand versus competitive foreign brands;
|
•
|
political instability, natural disasters, war or events of terrorism and health epidemics, such as COVID-19 or the conflict in
Ukraine; and
|
•
|
the strength of international economies.
|
•
|
the protection of wildlife, including migratory birds, bats and threatened and endangered species, such as desert tortoises, or
protected species such as eagles, and other protected plants or animals whose presence or movements often cannot be anticipated or controlled;
|
•
|
water use, and discharges of silt-containing or otherwise polluted waters into nearby wetlands or navigable waters;
|
•
|
hazardous or toxic substances or wastes and other regulated substances, materials or chemicals, including those existing on a
project site prior to our use of the site or the releases thereof into the environment;
|
•
|
land use, zoning, building, and transportation laws and requirements, which may mandate conformance with sound levels, radar and
communications interference, hazards to aviation or navigation, or other potential nuisances such as the flickering effect, known as shadow flicker, caused when rotating wind turbine blades periodically cast shadows through openings
such as the windows of neighboring properties;
|
•
|
the presence or discovery of archaeological, historical, religious or cultural artifacts at or near our projects;
|
•
|
the protection of workers’ health and safety; and
|
•
|
the proper decommissioning of the site at the end of its useful life.
|
•
|
be expensive and time-consuming to defend;
|
•
|
cause us to cease manufacturing, using or selling products that incorporate or otherwise use the asserted intellectual property;
|
•
|
require us to redesign, reengineer or rebrand our products, if feasible;
|
•
|
divert management’s attention and resources;
|
•
|
impair our ability to retain customers or attract prospects; and
|
•
|
require us to license third-party intellectual property.
|
•
|
the impact of COVID-19 on the Surviving Corporation’s financial condition and the results of operations;
|
•
|
the Surviving Corporation’s operating and financial performance and prospects;
|
•
|
the Surviving Corporation’s quarterly or annual earnings or those of other companies in its industry compared to market
expectations;
|
•
|
conditions that impact demand for the Surviving Corporation’s products and/or services;
|
•
|
future announcements concerning the Surviving Corporation’s business, its clients’ businesses or its competitors’ businesses;
|
•
|
the public’s reaction to the Surviving Corporation’s press releases or other public announcements and filings with the SEC;
|
•
|
the market’s reaction to the Surviving Corporation’s reduced disclosure and other requirements as a result of being an “emerging
growth company” under the JOBS Act;
|
•
|
the size of RMG III’s public float;
|
•
|
coverage by or changes in financial estimates by securities analysts or failure to meet their expectations;
|
•
|
market and industry perception of the Surviving Corporation’s success, or lack thereof, in pursuing its growth strategy;
|
•
|
strategic actions by the Surviving Corporation or its competitors, such as acquisitions or restructurings;
|
•
|
changes in laws or regulations which adversely affect the Surviving Corporation’s industry or the Surviving Corporation;
|
•
|
privacy and data protection laws, privacy or data breaches, or the loss of data;
|
•
|
changes in accounting standards, policies, guidance, interpretations or principles;
|
•
|
changes in senior management or key personnel;
|
•
|
issuances, exchanges or sales, or expected issuances, exchanges or sales of the Surviving Corporation capital stock;
|
•
|
changes in the Surviving Corporation’s dividend policy;
|
•
|
the impact of COVID-19 on the Surviving Corporation’s financial condition and the results of operations;
|
•
|
adverse resolution of new or pending litigation against the Surviving Corporation; and
|
•
|
changes in general market, economic and political conditions in the United States and global economies or financial markets,
including those resulting from inflation, natural disasters, terrorist attacks, acts of war and responses to such events.
|
•
|
a limited availability of market quotations for the Surviving Corporation Common Stock;
|
•
|
reduced liquidity for the Surviving Corporation Common Stock;
|
•
|
a determination that Surviving Corporation Common Stock is a “penny stock” which will require brokers trading in Surviving
Corporation Common Stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for the Surviving Corporation Common Stock;
|
•
|
a limited amount of analyst coverage; and
|
•
|
a decreased ability to issue additional securities or obtain additional financing in the future.
|
•
|
The Sponsor paid an aggregate of $12,349,495 for its purchases of the Founder Shares and the RMG III Private Placement Warrants.
Prior to the Initial Public Offering, the Sponsor purchased 10,062,500 Founder Shares for an aggregate purchase price of $25,000. Subsequently, RMG III effectuated a 5-for-6 share split of the RMG III Class B Ordinary Shares, resulting
in an aggregate outstanding amount of 12,075,000 Founder Shares outstanding. Simultaneously with the consummation of the Initial Public Offering, the Sponsor purchased 8,216,330 RMG III Private Placement Warrants for an aggregate
purchase price of $12,324,495 in a private placement. A portion of the proceeds from the sale of the RMG III Private Placement Warrants were added to the net proceeds from the Initial Public Offering held in the Trust Account. If the
Business Combination with H2B2 or another business combination is not consummated within the Completion Window, RMG III will cease all operations except for the purpose of winding up, redeeming the outstanding Public Shares for cash
and, subject to the approval of its remaining RMG III shareholders and the RMG III Board, dissolving and liquidating. In such event, the 12,075,000 Founder Shares held by the Initial Shareholders would be worthless because the Initial
Shareholders are not entitled to participate in any redemption or distribution with respect to such shares. Additionally, in such event, the 8,216,330 Private Placement Warrants will also expire worthless. The Founder Shares had an
|
•
|
In order to finance transaction costs in connection with a business combination, the Sponsor, members of the RMG III founding
team or any of their affiliates may, but are not obligated to (other than pursuant to the January 2022 Note and the July 2022 Note), make certain working capital loans as may be required. On January 19, 2022, RMG Acquisition Management
agreed to lend RMG III up to an aggregate of $500,000 for working capital purposes pursuant to the January 2022 Note. The January 2022 Note is due and payable in full by RMG III upon the consummation of a business combination. On
July 27, 2022, RMG Acquisition Management agreed to lend RMG III up to $475,000 for working capital purposes, pursuant to the July 2022 Note. The July 2022 Note is due and payable in full by RMG III upon the consummation of a business
combination. In the event that the Business Combination does not close, RMG III may use a portion of proceeds held outside the Trust Account to repay the January 2022 Note and the July 2022 Note, but no proceeds held in the Trust
Account would be used to repay the January 2022 Note or the July 2022 Note. The January 2022 Note and the July 2022 Note will be repaid in cash upon consummation of the Business Combination. As of the date hereof, RMG III has borrowed
$500,000 under the January 2022 Note and $350,000 under the July 2022 Note. If RMG III does not complete a business combination by the Completion Window, there will not be sufficient assets to repay the outstanding balance under the
January 2022 Note and the July 2022 Note, and the January 2022 Note and the July 2022 Note will be worthless.
|
•
|
There will be no finder’s fees, reimbursements or cash payments made by RMG III to the Sponsor or RMG III’s officers or
directors, or RMG III’s or any of their affiliates, for services rendered to RMG III prior to or in connection with the completion of the Business Combination, other than payment of the amount for office space, utilities,
administrative and support services and repayments of any outstanding balance of the January 2022 Note and the July 2022 Note, as described below. RMG III’s directors and officers and their affiliates are entitled to reimbursement of
out-of-pocket expenses incurred by them in connection with certain activities on RMG III’s behalf, such as identifying and investigating possible business targets and business combinations. There is no cap or ceiling on the
reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on RMG III’s behalf. However, if RMG III fails to consummate a business combination by the Completion Window, RMG III’s directors and
officers will not have any claim against the Trust Account for reimbursement. Accordingly, RMG III may not be able to reimburse these expenses if the Business Combination or another business combination is not consummated within the
Completion Window. As of , 2024, $ was outstanding in out-of-pocket expense reimbursements. Additionally, under the Administrative Services Agreement, RMG Acquisition Management is entitled to $20,000 per month for office
space, utilities, administrative and support services provided to RMG III’s management team, which commenced on February 4, 2021 and will continue through the earlier of consummation of a business combination or RMG III’s liquidation.
The Company incurred $60,000 and $180,000 in expenses in connection with such services during the three and nine months ended September 30, 2023, respectively. The Company incurred $60,000 and $180,000 in expenses in connection with
such services during the three and nine months ended September 30, 2022, respectively. The Company had $240,000 and $120,000 recorded in accrued expenses-related party in connection with such services as of September 30, 2023 and
December 31, 2022, respectively.
|
•
|
RMG III’s existing directors and officers will be eligible for continued indemnification and continued coverage under RMG III’s
directors’ and officers’ liability insurance following completion of the Business Combination pursuant to the Merger Agreement.
|
•
|
In the event of the liquidation of the Trust Account, the Sponsor has agreed, under the Letter Agreement, dated February 4,
2021, among RMG III, the Sponsor and RMG III’s officers and directors, to indemnify and hold harmless RMG III against any and all losses, liabilities, claims, damages and expenses to which RMG III may become subject as a result of any
claim by (i) any third party for services rendered or products sold to RMG III or (ii) a prospective target business with which RMG III has entered into an acquisition agreement; provided that such indemnification of RMG III by
|
•
|
Pursuant to the Sponsor Support Agreement, the Sponsor has agreed to, subject to certain exceptions, among other things, vote in
favor of the Merger Agreement and the transactions contemplated thereby, in each case, subject to the terms and conditions contemplated by the Sponsor Support Agreement.
|
•
|
Subject to certain limited exceptions, the Surviving Corporation Common Stock will not be transferable following the Closing
until the date that is 180 days after the Closing.
|
•
|
The Sponsor (including RMG III’s directors, officers and Initial Shareholders and their permitted transferees) owns RMG III
Private Placement Warrants which, in the event the Warrant Amendment Proposal is approved prior to the Effective Time, will be converted into the right to receive up to 0.075 shares of Surviving Corporation Common Stock per RMG III
Private Placement Warrant.
|
•
|
Certain of RMG III’s officers and directors presently have, and any of them in the future may have additional, fiduciary or
contractual obligations to other entities pursuant to which such officer or director is or will be required to present business combination opportunities to such entity. Accordingly, in the future, if any of RMG III’s officers or
directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations
to present such opportunity to such entity. RMG III does not believe, however, that any fiduciary duties or contractual obligations of its officers or directors would materially undermine RMG III’s ability to complete a business
combination. The Existing Articles provide that RMG III’s directors and officers renounce any interest or expectancy in, or in being offered, any corporate opportunity offered to any director or officer, but no director or officer of
RMG III has any duty, except and to the extent expressly assumed by contract, to communicate or offer any such corporate opportunity to RMG III’s directors and officers and shall not be in breach of any fiduciary duty as a director or
officer, solely by reason of fact that such party pursues or acquires such corporate opportunity for itself, himself or herself, directs such corporate opportunity to another person, or does not communicate information regarding such
corporate opportunity to RMG III. This waiver allows the Sponsor and its affiliates to allocate opportunities based on a combination of the objectives and fundraising needs of the target, as well as the investment objectives of the
entity. However, RMG III does not believe that the waiver of the corporate opportunities doctrine otherwise had a material impact on its search for an acquisition target.
|
•
|
the ability of the Surviving Corporation Board to issue shares of preferred stock, including “blank check” preferred stock and
to determine the terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
|
•
|
the Proposed Certificate of Incorporation does not provide for cumulative voting in the election of directors, which limits the
ability of minority stockholders to elect director candidates;
|
•
|
the limitation of the liability of, and the indemnification of, the Surviving Corporation’s directors and officers;
|
•
|
the ability of the Surviving Corporation Board to amend the Proposed Bylaws, which may allow the Surviving Corporation Board to
take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend the Proposed Bylaws to facilitate an unsolicited takeover attempt; and
|
•
|
advance notice procedures with which stockholders must comply to nominate candidates to the Surviving Corporation Board or to
propose matters to be acted upon at a stockholders’ meeting, which could preclude stockholders from bringing matters before annual or special meetings of stockholders and delay changes in the Surviving Corporation Board and also may
discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of the Surviving Corporation.
|
|
| |
Scenario 1 – Assuming No
Redemption
|
| |
Scenario 2 – Assuming
Maximum Redemption
|
||||||
Capitalization:
|
| |
Shares
|
| |
%
|
| |
Shares
|
| |
%
|
H2B2 Stockholders(1)
|
| |
40,000,000
|
| |
91.57%
|
| |
40,000,000
|
| |
93.01%
|
Holders of RMG III Private Placement Warrants
|
| |
616,225
|
| |
1.41%
|
| |
616,225
|
| |
1.43%
|
Holders of RMG III Public Warrants
|
| |
724,500
|
| |
1.66%
|
| |
724,500
|
| |
1.69%
|
Public Shareholders
|
| |
635,778
|
| |
1.46%
|
| |
—
|
| |
—
|
Sponsor(2)
|
| |
1,508,368
|
| |
3.45%
|
| |
1,467,786
|
| |
3.41%
|
Other Stockholders(3)
|
| |
197,500
|
| |
0.45%
|
| |
197,500
|
| |
0.46%
|
Total Shares Outstanding
|
| |
43,682,371
|
| |
100%
|
| |
43,006,011
|
| |
100%
|
(1)
|
The H2B2 Stockholders shares assumes a pre-money valuation of H2B2 of $400 million.
|
(2)
|
Such shares of Surviving Corporation Common Stock issuable in respect of 12,075,000 RMG III Class B Ordinary Shares held by
the Sponsor, as converted pursuant to the Merger Agreement, inclusive of the 255,319 shares of Surviving Corporation Common Stock issuable in respect of the Convertible Notes of $30.0 million (footnote 4 below). The 3.45%-3.41%
ownership of the Sponsor does not incorporate the effect of the Warrant Amendment explained above.
|
(3)
|
RMG III and Cohen, the capital markets division of J.V.B. Financial Group, LLC, entered into an engagement letter, dated as of
December 5, 2022, pursuant to which RMG III will pay to Cohen, in exchange for services rendered by Cohen in connection with seeking the First Extension and the First Extension Amendment, an advisory fee amounting to (i) $500,000 paid
in cash and due to Cohen at the Closing and (ii) $250,000 paid in equivalent dollar amount of Surviving Corporation Common Stock which will be delivered to Cohen at any time prior to sixty (60) days following the Closing. It includes
the 172,500 shares of Surviving Corporation Common Stock issuable in exchange of the Convertible Debt of $1.5 million with a conversion premium of 15% (footnote 3 below).
|
•
|
H2B2’s existing stockholders will have the greatest voting interest in the Surviving Corporation;
|
•
|
H2B2’s existing stockholders will have the ability to control decisions regarding the election and removal of directors and
officers of the Surviving Corporation;
|
•
|
H2B2 is significantly larger than RMG III by total assets and total cash and cash equivalents;
|
•
|
The senior management team of H2B2 will continue to serve in such positions with substantially similar responsibilities and
duties at the Surviving Corporation following consummation of the Business Combination; and
|
•
|
The purpose and intent of the Business Combination is to create an operating public company, with H2B2’s management continuing
to use its know-how to grow the business.
|
•
|
Scenario 1 — Assuming No Redemptions: This presentation assumes that no Public
Shareholders exercise redemption rights with respect to the remaining 635,778 Public Shares upon consummation of the Business Combination; and
|
•
|
Scenario 2 — Assuming Maximum Redemptions: This presentation assumes that
Public Shareholders exercise their redemption rights with respect to the remaining 635,778 Public Shares upon consummation of the Business Combination at a redemption price of approximately $10.50 per share, based on the amount held
in the Trust Account as of November 30, 2023. Scenario 2 includes all adjustments contained in Scenario 1 and presents additional adjustments to reflect the effect of maximum redemptions.
|
|
| |
H2B2
(Historical)
|
| |
RMG III
(Historical)
|
| |
Debt
Raise
Transaction
|
| |
FN
|
| |
Transaction
Accounting
Adjustments
|
| |
FN
|
| |
Pro Forma
Combined
(Assuming No
Redemptions)
|
| |
Maximum
Redemption
|
| |
FN
|
| |
Pro Forma
Combined
(Assuming
Maximum
Redemptions)
|
Current assets:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$11,534,785
|
| |
$310,838
|
| |
$27,125,000
|
| |
(4a)
|
| |
$(12,669,827)
|
| |
|
| |
$26,300,796
|
| |
$(6,655,195)
|
| |
(10)
|
| |
$19,645,601
|
|
| |
|
| |
|
| |
|
| |
|
| |
6,655,195
|
| |
(1)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
(19,325,022)
|
| |
(9)
|
| |
|
| |
|
| |
|
| |
|
Accounts receivable
|
| |
2,392,859
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
2,392,859
|
| |
—
|
| |
|
| |
2,392,859
|
Inventory
|
| |
2,951,413
|
| |
—
|
| |
2.875.000
|
| |
(4b)
|
| |
—
|
| |
|
| |
5,826,413
|
| |
—
|
| |
|
| |
5,826,413
|
Prepaid expenses and other current assets
|
| |
2,029,972
|
| |
51,374
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
2,081,346
|
| |
—
|
| |
|
| |
2,081,346
|
Grants receivable
|
| |
1,259,393
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
1,259,393
|
| |
—
|
| |
|
| |
1,259,393
|
Contract assets
|
| |
266,034
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
266,034
|
| |
—
|
| |
|
| |
266,034
|
Total Current Assets
|
| |
20,434,456
|
| |
362,212
|
| |
30,000,000
|
| |
|
| |
(12,669,827)
|
| |
|
| |
38,126,841
|
| |
(6,655,195)
|
| |
|
| |
31,471,646
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Non-Current assets:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Property, plant, and equipment, net
|
| |
12,071,988
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
12,071,988
|
| |
—
|
| |
|
| |
12,071,988
|
Operating lease - Right of use asset, net
|
| |
1,978,266
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
1,978,266
|
| |
—
|
| |
|
| |
1,978,266
|
Intangible assets, net
|
| |
154,019
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
154,019
|
| |
—
|
| |
|
| |
154,019
|
Equity methods investments
|
| |
142,530
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
142,530
|
| |
—
|
| |
|
| |
142,530
|
Other assets
|
| |
1,764,838
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
1,764,838
|
| |
—
|
| |
|
| |
1,764,838
|
Investments held in Trust Account
|
| |
—
|
| |
6,655,195
|
| |
—
|
| |
|
| |
(6,655,195)
|
| |
(1)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Total Non-Current Assets
|
| |
16,111,641
|
| |
6,655,195
|
| |
—
|
| |
|
| |
(6,655,195)
|
| |
|
| |
16,111,641
|
| |
—
|
| |
|
| |
16,111,641
|
Total Assets
|
| |
$36,546,097
|
| |
$7,017,407
|
| |
$30,000,000
|
| |
|
| |
$(19,325,022)
|
| |
|
| |
$54,238,482
|
| |
$(6,655,195)
|
| |
|
| |
$47,583,287
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Liabilities and Shareholders’ Deficit
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Current Liabilities:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Accounts payable
|
| |
$14,153,960
|
| |
$33,367
|
| |
$—
|
| |
|
| |
$—
|
| |
|
| |
$14,187,327
|
| |
$—
|
| |
|
| |
$14,187,327
|
Current maturities of long-term debt
|
| |
1,521,458
|
| |
—
|
| |
|
| |
|
| |
(1,500,000)
|
| |
(3)
|
| |
21,458
|
| |
—
|
| |
|
| |
21,458
|
Current maturities of operating lease liabilities
|
| |
166,926
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
166,926
|
| |
—
|
| |
|
| |
166,926
|
Contract liabilities
|
| |
3,220,563
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
3,220,563
|
| |
—
|
| |
|
| |
3,220,563
|
Current provisions
|
| |
85,864
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
85,864
|
| |
—
|
| |
|
| |
85,864
|
Other current liabilities
|
| |
35,596
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
35,596
|
| |
—
|
| |
|
| |
35,596
|
Accrued expenses
|
| |
—
|
| |
7,840,457
|
| |
—
|
| |
|
| |
(7,840,457)
|
| |
(9)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Total Current Liabilities
|
| |
19,184,367
|
| |
7,873,824
|
| |
—
|
| |
|
| |
(9,340,457)
|
| |
|
| |
17,717,734
|
| |
—
|
| |
|
| |
17,717,734
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Non-Current Liabilities:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Unearned grants
|
| |
3,531,326
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
3,531,326
|
| |
—
|
| |
|
| |
3,531,326
|
Long-term operating lease liabilities
|
| |
1,900,146
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
1,900,146
|
| |
—
|
| |
|
| |
1,900,146
|
Income taxes payable
|
| |
1,859,225
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
1,859,225
|
| |
—
|
| |
|
| |
1,859,225
|
Long-term debt, less current maturities
|
| |
16,559,531
|
| |
—
|
| |
30,000,000
|
| |
(4)
|
| |
|
| |
|
| |
46,559,531
|
| |
—
|
| |
|
| |
46,559,531
|
Other liabilities
|
| |
8,470,231
|
| |
—
|
| |
—
|
| |
|
| |
(106,117)
|
| |
(2)
|
| |
8,364,114
|
| |
—
|
| |
|
| |
8,364,114
|
Deferred legal fees
|
| |
—
|
| |
250,000
|
| |
—
|
| |
|
| |
(250,000)
|
| |
(9)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Deferred underwriting commissions
|
| |
—
|
| |
6,762,000
|
| |
—
|
| |
|
| |
(6,762,000)
|
| |
(8)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Convertible Working Capital Loan - related party
|
| |
—
|
| |
850,000
|
| |
—
|
| |
|
| |
(850,000)
|
| |
(9)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Derivative warrant liabilities
|
| |
—
|
| |
2,323,923
|
| |
—
|
| |
|
| |
(2,323,923)
|
| |
|
| |
—
|
| |
—
|
| |
|
| |
—
|
|
| |
|
| |
|
| |
|
| |
|
| |
(15,194,881)
|
| |
(5)
|
| |
|
| |
|
| |
|
| |
|
|
| | | | | | | |
|
| |
12,870,958
|
| |
(5)
|
| | | | | |
|
| | ||||||
Total Liabilities
|
| |
51,504,826
|
| |
18,059,747
|
| |
30,000,000
|
| |
|
| |
(19,632,497)
|
| |
|
| |
79,932,076
|
| |
—
|
| |
|
| |
79,932,076
|
Class A Ordinary shares subject to possible redemption
|
| |
—
|
| |
6,357,780
|
| |
—
|
| |
|
| |
(6,357,780)
|
| |
(1)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
|
| |
H2B2
(Historical)
|
| |
RMG III
(Historical)
|
| |
Debt
Raise
Transaction
|
| |
FN
|
| |
Transaction
Accounting
Adjustments
|
| |
FN
|
| |
Pro Forma
Combined
(Assuming No
Redemptions)
|
| |
Maximum
Redemption
|
| |
FN
|
| |
Pro Forma
Combined
(Assuming
Maximum
Redemptions)
|
Shareholders’ Deficit
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Common stock
|
| |
103
|
| |
—
|
| |
—
|
| |
|
| |
4,266
|
| |
|
| |
4,369
|
| |
(68)
|
| |
(10)
|
| |
4,301
|
|
| |
|
| |
|
| |
|
| |
|
| |
636
|
| |
(1)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
17
|
| |
(3)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
134
|
| |
(5)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
3,476
|
| |
(6)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
3
|
| |
(9)
|
| |
|
| |
|
| |
|
| |
|
Class B Ordinary shares
|
| |
—
|
| |
1,208
|
| |
—
|
| |
|
| |
(1,208)
|
| |
(6)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Additional paid-in capital
|
| |
1,341,102
|
| |
9,585,984
|
| |
—
|
| |
|
| |
(6,907,051)
|
| |
|
| |
(4,020,035)
|
| |
(6,655,127)
|
| |
(10)
|
| |
(2,635,092)
|
|
| |
|
| |
|
| |
|
| |
|
| |
6,357,144
|
| |
(1)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
106,117
|
| |
(2)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
1,724,983
|
| |
(3)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
15,194,747
|
| |
(5)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
(39,860,546)
|
| |
(6)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
2,558,507
|
| |
(7)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
6,762,000
|
| |
(8)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
249,997
|
| |
(9)
|
| |
|
| |
|
| |
|
| |
|
Accumulated other comprehensive loss
|
| |
(3,842)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
(3,842)
|
| |
—
|
| |
|
| |
(3,842)
|
Retained earnings (Accumulated deficit)
|
| |
(16,296,083)
|
| |
(26,987,312)
|
| |
—
|
| |
|
| |
13,569,239
|
| |
|
| |
(29,714,156)
|
| |
—
|
| |
|
| |
(29,714,156)
|
|
| |
|
| |
|
| |
|
| |
|
| |
(225,000)
|
| |
(3)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
(12,870,958)
|
| |
(5)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
39,858,270
|
| |
(6)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
(2,558,507)
|
| |
(7)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
(10,634,566)
|
| |
(9)
|
| |
|
| |
|
| |
|
| |
|
(Less) common stock in treasury
|
| |
(9)
|
| |
—
|
| |
—
|
| |
|
| |
9
|
| |
(6)
|
| |
—
|
| |
—
|
| | | |
—
|
|
Total Shareholders’ Deficit
|
| |
(14,958,729)
|
| |
(17,400,120)
|
| |
—
|
| |
|
| |
6,665,255
|
| |
|
| |
(25,693,594)
|
| |
(6,655,195)
|
| |
|
| |
(32,348,789)
|
Total Liabilities and Shareholders’ Deficit
|
| |
$36,546,097
|
| |
$7,017,407
|
| |
$30,000,000
|
| |
|
| |
$(19,325,022)
|
| |
|
| |
$54,238,482
|
| |
$(6,655,195)
|
| |
|
| |
$47,583,287
|
(1)
|
To reflect the release of cash from marketable securities held in the Trust Account and the conversion of the RMG III
Ordinary Shares subject to possible redemption.
|
(2)
|
Reflects the cancellation of the liability related to the incentive plan awarded by H2B2 to nine of its executives. H2B2
executed in 2021 stock-based compensation awards that entitled the executives to purchase up to 555,000 shares for a purchase price of $1.00 per employee award. The awards become fully vested between January 1, 2026, and March 31,
2026, upon satisfaction of both of the following: (a) H2B2’s stock is publicly traded prior to January 1, 2026 and, (b) the executive maintains employment with the Company until March 31, 2026. In the event the conditions were not
met, the awards shall be terminated on December 31, 2025 and the executives shall be entitled to receive a cash bonus. Prior to the Business Combination, H2B2 had recorded a liability associated with the cash bonus component of the
awards as it determined that the conditions were not probable. Pursuant to the Business Combination the liability associated with the cash bonus component of H2B2’s incentive plan that is then outstanding will be canceled with the
corresponding effect on Additional paid in capital. The conditions of the incentive plan would then be probable, and it will be converted into the right to receive an option to purchase shares of Surviving Corporation Common Stock
upon substantially the same terms and conditions as the original H2B2 incentive plan, adjusted by the exchange ratio. Thus, the initial 555,000 options will be converted to 2,333,156 options (x 4.2 times) to purchase shares of
Surviving Corporation Common Stock. See footnote 7 for the accounting associated with the expense of the options in conjunction with the Business Combination.
|
(3)
|
Reflects the conversion of $1.5 million Convertible Debt into shares of Surviving Corporation Common Stock plus the
conversion premium of 15%. The convertible notes are automatically converted into shares of Surviving Corporation Common Stock at a conversion price equal to 100% of the price paid per share by investors in connection with a Capital
Raise Transaction. Upon the Capital Raise Transaction, the notes are converted into shares of Surviving Corporation Common Stock thereby removing Convertible Debt of $1.5 million, recognizing Equity of $1.7 million, and an increase in
Accumulated deficit for the conversion premium of $0.2 million. This has been reflected in the capitalization table above as Other Stockholders represented as 172,500 shares with a nominal value of $0.0001 per share.
|
(4)
|
Represents the following Capital Raise Transaction adjustments:
|
(a)
|
Reflects the $27.1 million cash received through convertible notes (the “Convertible Notes I”) issued to certain investors in
the Capital Raise Transaction. It is assumed for the pro forma that these Convertible Note I holders will receive a 10.0% coupon in PIK (paid in kind) accrued annually. This $27.1 million cash receipt is reflected as an increase in
Cash and Cash Equivalent and a corresponding increase to Long-Term Debt.
|
(b)
|
Reflects the acquisition of five 1 MW Stacks at an aggregate purchase price of $2.9 million by Surviving Corporation in
exchange for convertible notes (the “Convertible Notes II”). The Convertible Note II holders will receive a 10.0% coupon in PIK (paid in kind) accrued annually and will have a maturity of five years. The notes can be converted into
Surviving Corporation Common Stock at any time during the 5 year-period or will automatically convert upon maturity. The conversion price will be calculated at a discount using a 20-day trailing VWAP (volume-weighted average price)
based on the Surviving Corporation’s share price post Business Combination close. Upon the Business Combination Transaction, $2.9 million of Inventory and Long-Term Debt is recognized.
|
(5)
|
Reflects the cancellation and exchange exercise of both the RMG III Public Warrants and RMG III Private Placement Warrants by
RMG III for Surviving Company Common Stock. The quotation of RMG III Warrants has increased from $0.03 per warrant as of December 31, 2022 to $0.75 per warrant,
|
(6)
|
Reflects the recapitalization of the combined company as the Business Combination will be treated as the equivalent of a
capital transaction in which H2B2 is issuing stock for the net assets of RMG III.
|
(7)
|
Reflects $0.9 million charge associated with the Incentive Plan of H2B2 executives on the date of the Business Combination as
a cumulative catch up, plus stock-based compensation expense for the year ended December 31, 2022 and for the nine months period ended September 30, 2023 of $0.9 million and $0.7 million, respectively, to recognize the expense over
the remaining service period.
|
(8)
|
Reflects that Barclays has waived its entitlement to the payment by RMG III of the $6.8 million portion of the deferred
underwriting commission allocable to it under the terms of the Underwriting Agreement. Barclays does not have any role with respect to the Business Combination. The deferred underwriting commission recognized by RMG III has been
waived with the corresponding effect on Additional paid in capital.
|
(9)
|
Reflects the payment in cash for transaction costs and other related costs of approximately $19.3 million, both previously
incurred and expected to be incurred related to the repayment of $8.1 million of RMG III expenses incurred prior to the Business Combination for deferred legal fees and other accrued expenses; $0.8 million to be paid by RMG III as
repayment of the related party working capital debt; and $10.4 million of aggregated transaction costs associated with the Closing.
|
(10)
|
In Scenario 1 – Assuming No Redemptions, which assumes the same facts as described in Items 1 to 9 above, but also assumes no
additional Public Shareholders exercise their redemption rights, the Public Shares subject to redemption for cash amounting to $6.7 million of the total $6.7 million held in the Trust Account would be transferred to the Surviving
Corporation.
|
|
| |
H2B2
(Historical)
|
| |
RMG III
(Historical)
|
| |
Transaction
Accounting
Adjustments
|
| |
FN
|
| |
Pro Forma
Combined
(Assuming No
Redemptions)
|
| |
Maximum
Redemption
|
| |
FN
|
| |
Pro Forma
Combined
(Assuming
Maximum
Redemptions)
|
Product sales
|
| |
$7,932,684
|
| |
$—
|
| |
$—
|
| |
|
| |
$7,932,684
|
| |
$—
|
| |
|
| |
$7,932,684
|
Cost of sales
|
| |
7,924,701
|
| |
—
|
| |
—
|
| |
|
| |
7,924,701
|
| |
—
|
| |
|
| |
7,924,701
|
Gross profit
|
| |
7,983
|
| |
—
|
| |
—
|
| |
|
| |
7,983
|
| |
—
|
| |
|
| |
7,983
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Operating expenses:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
1,894,644
|
| |
—
|
| |
—
|
| |
|
| |
1,894,644
|
| |
—
|
| |
|
| |
1,894,644
|
Selling, general and administrative
|
| |
7,403,238
|
| |
7,993,065
|
| |
697,775
|
| |
(12)
|
| |
16,094,078
|
| |
—
|
| |
|
| |
16,094,078
|
Depreciation of long-lived assets
|
| |
134,151
|
| |
—
|
| |
—
|
| |
|
| |
134,151
|
| |
—
|
| |
|
| |
134,151
|
Income from grants
|
| |
1,709,387
|
| |
—
|
| |
—
|
| |
|
| |
1,709,387
|
| |
—
|
| |
|
| |
1,709,387
|
Losses from our unconsolidated investments
|
| |
131,132
|
| |
—
|
| |
—
|
| |
|
| |
131,132
|
| |
—
|
| |
|
| |
131,132
|
Loss from operations
|
| |
(7,845,795)
|
| |
(7,993,065)
|
| |
(697,775)
|
| |
|
| |
(16,536,635)
|
| |
—
|
| |
|
| |
(16,536,635)
|
Other non-operating income
|
| |
326,203
|
| |
—
|
| |
—
|
| |
|
| |
326,203
|
| |
—
|
| |
|
| |
326,203
|
Interest and other expense, net
|
| |
(341,332)
|
| |
1,330
|
| |
(2,475,000)
|
| |
(13)
|
| |
(2,815,002)
|
| |
—
|
| |
|
| |
(2,815,002)
|
Change in fair value of derivative liability
|
| |
—
|
| |
(1,787,623)
|
| |
1,787,623
|
| |
(13)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Unrealized gain on marketable securities held in trust
account
|
| |
—
|
| |
1,562,977
|
| |
(1,562,977)
|
| |
(13)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Reduction in deferred underwriting commission
|
| |
—
|
| |
440,592
|
| |
(440,592)
|
| |
(13)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Net income/(loss) before tax
|
| |
(7,860,924)
|
| |
(7,775,789)
|
| |
(3,388,721)
|
| |
|
| |
(19,025,434)
|
| |
—
|
| |
|
| |
(19,025,434)
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Income tax expense
|
| |
69,884
|
| |
—
|
| |
—
|
| |
|
| |
69,884
|
| |
—
|
| |
|
| |
69,884
|
Net loss
|
| |
(7,930,808)
|
| |
(7,775,789)
|
| |
(3,388,721)
|
| |
|
| |
(19,095,318)
|
| |
—
|
| |
|
| |
(19,095,318)
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Weighted average shares outstanding, basic and diluted
|
| |
9,621,235
|
| |
14,843,541
|
| |
|
| |
|
| |
43,682,371
|
| |
|
| |
|
| |
43,006,011
|
Basic and diluted earnings per share attributable to
equity holders of the parent
|
| |
$(0.82)
|
| |
$(0.52)
|
| |
$
|
| |
|
| |
$(0.44)
|
| |
$
|
| |
|
| |
$(0.44)
|
|
| |
H2B2
(Historical)
|
| |
RMG III
(Historical)
|
| |
Transaction
Accounting
Adjustments
|
| |
FN
|
| |
Pro Forma
Combined
(Assuming No
Redemptions)
|
| |
Maximum
Redemption
|
| |
FN
|
| |
Pro Forma
Combined
(Assuming
Maximum
Redemptions)
|
Product sales
|
| |
$3,491,673
|
| |
$—
|
| |
$—
|
| |
|
| |
$3,491,673
|
| |
$—
|
| |
|
| |
$3,491,673
|
Cost of sales
|
| |
3,042,412
|
| |
—
|
| |
—
|
| |
|
| |
3,042,412
|
| |
—
|
| |
|
| |
3,042,412
|
Gross profit
|
| |
449,261
|
| |
—
|
| |
—
|
| |
|
| |
449,261
|
| |
—
|
| |
|
| |
449,261
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Operating expenses:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
1,333,961
|
| |
—
|
| |
—
|
| |
|
| |
1,333,961
|
| |
—
|
| |
|
| |
1,333,961
|
Selling, general and administrative
|
| |
3,904,132
|
| |
2,188,743
|
| |
12,495,298
|
| |
|
| |
18,588,173
|
| |
—
|
| |
|
| |
18,588,173
|
|
| |
|
| |
—
|
| |
10,634,566
|
| |
(11)
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
—
|
| |
1,860,732
|
| |
(12)
|
| |
|
| |
|
| |
|
| |
|
Depreciation of long-lived assets
|
| |
88,257
|
| |
—
|
| |
—
|
| |
|
| |
88,257
|
| |
—
|
| |
|
| |
88,257
|
Income from grants
|
| |
801,991
|
| |
—
|
| |
—
|
| |
|
| |
801,991
|
| |
—
|
| |
|
| |
801,991
|
Loss from operations
|
| |
(4,075,098)
|
| |
(2,188,743)
|
| |
(12,495,298)
|
| |
|
| |
(18,759,139)
|
| |
—
|
| |
|
| |
(18,759,139)
|
Other non-operating income/(expense)
|
| |
411,879
|
| |
—
|
| |
—
|
| |
|
| |
411,879
|
| |
—
|
| |
|
| |
411,879
|
Interest and other expense, net
|
| |
(557,112)
|
| |
(7,692)
|
| |
(3,225,000)
|
| |
(13)
|
| |
(3,789,804)
|
| |
—
|
| |
|
| |
(3,789,084)
|
Change in fair value of derivative liability
|
| |
—
|
| |
13,772,685
|
| |
(13,772,685)
|
| |
(13)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
Unrealized gain on marketable securities held in trust
account
|
| |
—
|
| |
4,299,827
|
| |
(4,299,827)
|
| |
(13)
|
| |
—
|
| |
—
|
| |
|
| |
—
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Net income/(loss) before tax
|
| |
(4,220,331)
|
| |
15,876,077
|
| |
(33,792,810)
|
| |
|
| |
(22,137,064)
|
| |
—
|
| |
|
| |
(22,137,064)
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Income tax expense
|
| |
76,128
|
| |
—
|
| | | |
|
| |
76,128
|
| |
—
|
| |
|
| |
76,128
|
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Net income/(loss)
|
| |
(4,296,459)
|
| |
15,876,077
|
| |
(33,792,810)
|
| |
|
| |
(22,213,192)
|
| |
—
|
| |
|
| |
(22,213,192)
|
Weighted average shares outstanding, basic and diluted
|
| |
9,727,939
|
| |
60,375,000
|
| |
|
| |
|
| |
43,682,371
|
| |
|
| |
|
| |
43,006,011
|
Basic and diluted earnings per share attributable to
equity holders of the parent
|
| |
$(0.44)
|
| |
$0.26
|
| |
$
|
| |
|
| |
$(0.51)
|
| |
$
|
| |
|
| |
$(0.52)
|
(11)
|
To reflect the effect of the estimated transaction costs corresponding to RMG III and H2B2 ($10.6 million) as explained in
footnote 9. The transaction costs have been reflected in the unaudited pro forma condensed combined income statement of the combined entities, exclusively, for the twelve months ended December 31, 2022.
|
(12)
|
To reflect the effect of the Incentive Plan explained in footnotes 2 and 7.
|
(13)
|
Represents the following adjustments:
|
(i)
|
eliminate interest income on marketable securities in the amount of $4.3 million for the twelve months ended December 31,
2022 and $1.6 million for the nine months ended September 30, 2023, respectively held in the Trust Account; to eliminate the effect of the fair value change of RMG III Warrants for the twelve months ended December 31, 2022 ($13.8
million) and for the nine months ended September 30, 2023 ($1.8 million) and to eliminate the reduction of the deferred underwriting commissions for the nine-month period ended September 30, in the amount of $0.4 million, as they are
all non-recurring items in nature. As explained in footnote 5, the revaluation of the warrant liability of $12.9 million has not been included in the unaudited pro forma condensed combined income statement as it is the results of the
revaluation of the warrants issued by RMG III before the Merger;
|
(ii)
|
recognize the conversion premium of the convertible notes explained in footnote 3 amounting to $0.2 million for the twelve
months ended December 31, 2022; and
|
(iii)
|
recognize the coupon paid in kind of the Convertible Notes I explained in footnote 4a amounting to $2.7 million for the
twelve months ended December 31, 2022, and $2.2 million for the nine months ended September 30, 2023.
|
(iv)
|
recognize the coupon paid in kind of the Convertible Notes II explained in footnote 4b amounting to $0.3 million for the
twelve months ended December 31, 2022, and $0.2 million for the nine months ended September 30, 2023.
|
|
| |
Pro Forma Combined
|
|||
|
| |
Assuming
No Redemption
|
| |
Assuming
Maximum
Redemption
|
Twelve-Month Period Ended December 31, 2022
|
| |
|
| |
|
Loss for the year attributable to shareholders of the parent
|
| |
$(22,213,192)
|
| |
$(22,213,192)
|
|
| |
|
| |
|
Basic attributable loss per share
|
| |
$(0.51)
|
| |
$(0.52)
|
Diluted attributable loss per share
|
| |
$(0.51)
|
| |
$(0.52)
|
|
| |
|
| |
|
|
| |
Pro Forma Combined
|
|||
|
| |
Assuming
No Redemption
|
| |
Assuming
Maximum
Redemption
|
Nine-Month Period Ended September
30, 2023
|
| |
|
| |
|
Loss for the period attributable to shareholders of the parent
|
| |
$(19,095,318)
|
| |
$(19,095,318)
|
|
| |
|
| |
|
Basic attributable loss per share
|
| |
$(0.44)
|
| |
$(0.44)
|
Diluted attributable loss per share
|
| |
$(0.44)
|
| |
$(0.44)
|
|
| |
|
| |
|
Pro forma weighted average number of shares outstanding
|
| |
43,682,371
|
| |
43,006,011
|
Basic pro forma weighted average number of shares
outstanding
|
| |
43,682,371
|
| |
43,006,011
|
Diluted pro forma weighted average number of shares
outstanding
|
| |
43,682,371
|
| |
43,006,011
|
1.
|
Basis of Presentation
|
•
|
H2B2’s unaudited condensed consolidated balance sheet as of September 30, 2023, as included elsewhere in this proxy
statement/prospectus; and
|
•
|
RMG III’s unaudited condensed balance sheet as of September 30, 2023, as included elsewhere in this proxy
statement/prospectus.
|
•
|
H2B2’s unaudited condensed consolidated statement of operations for the nine-month period ended September 30, 2023, as
included elsewhere in this proxy statement/prospectus; and
|
•
|
RMG III’s unaudited condensed statement of operations for the year ended September 30, 2023, as included elsewhere in this
proxy statement/prospectus.
|
•
|
H2B2’s audited consolidated statement of operations for the year ended December 31, 2022, as included elsewhere in this proxy
statement/prospectus; and
|
•
|
RMG III’s audited statement of operations for the year ended December 31, 2022, as included elsewhere in this proxy
statement/prospectus.
|
•
|
Scenario 1 — Assuming No Redemptions: This presentation assumes that no Public
Shareholders exercise redemption rights with respect to the remaining 635,778 Public Shares upon consummation of the Business Combination; and
|
•
|
Scenario 2 — Assuming Maximum Redemptions: This presentation assumes that
Public Shareholders exercise their redemption rights with respect to the remaining 635,778 Public Shares upon consummation of the Business Combination at a redemption price of approximately $10.50 per share, based on the amount held
in the Trust Account as of November 30, 2023. Scenario 2 – Assuming Maximum Redemptions includes all adjustments contained in Scenario 1 – Assuming No Redemptions and presents additional adjustments to reflect the effect of maximum
redemptions.
|
2.
|
Accounting Policies
|
3.
|
Adjustments to Unaudited Pro Forma Condensed Combined Financial Information
|
•
|
consider and vote upon a proposal to approve by ordinary resolution and adopt the Merger Agreement and the Merger Agreement
Amendment attached to this proxy statement/prospectus as Annex A and Annex A-1, respectively, pursuant to which, among other things, following the Domestication of RMG III to
Delaware, the Merger of H2B2 with and into RMG III, with RMG III surviving the Merger in accordance with the terms and subject to the conditions of the Merger Agreement as more fully described elsewhere in this proxy
statement/prospectus (Business Combination Proposal);
|
•
|
consider and vote upon a proposal to approve by special resolution, assuming the Business Combination Proposal is approved
and adopted, the change of RMG III’s jurisdiction of incorporation by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware
(Domestication Proposal);
|
•
|
consider and vote upon the following four separate proposals (collectively, the Organizational Documents Proposals) to
approve by special resolution, assuming the Business Combination Proposal and the Domestication Proposal are approved and adopted, the following material differences between the RMG III Governing Documents and the Proposed
Organizational Documents, each to be effective at the Effective Time:
|
•
|
to authorize the change in authorized share capital of RMG III from 500,000,000 Class A Ordinary Shares, 50,000,000 Class B
Ordinary Shares and 5,000,000 preference shares, par value $0.0001 per share, to shares of Surviving Corporation Common Stock (Organizational Documents Proposal A);
|
•
|
to authorize the Surviving Corporation Board to issue any or all shares of Surviving Corporation Preferred Stock in one or
more classes or series, with such terms and conditions as may be expressly determined by the Surviving Corporation Board and as may be permitted by the DGCL (Organizational Documents Proposal B);
|
•
|
to approve that the Surviving Corporation Board will not be classified (Organizational Documentation Proposal C);
|
•
|
to authorize all other changes in connection with the replacement of the RMG III Governing Documents with the Proposed
Certificate of Incorporation and Proposed Bylaws in connection with the consummation of the Business Combination (copies of which are attached to this proxy statement/prospectus as Annex F,
Annex G and Annex H, respectively), including (i) changing the corporate name from “RMG Acquisition Corp. III” to “H2B2 Electrolysis Technologies, Inc.,” (ii) making the Surviving Corporation’s
corporate existence perpetual, (iii) adopting Delaware as the exclusive forum for certain stockholder litigation, and (iv) removing certain provisions related to RMG III’s status as a blank check company that will no longer be
applicable upon consummation of the Business Combination, all of which the RMG III Board believes is necessary to adequately address the needs of RMG III and the Surviving Corporation after the Business Combination (collectively,
Organizational Documents Proposal D);
|
•
|
consider and vote upon a proposal to approve by ordinary resolution of the holders of the RMG III Class B Ordinary Shares,
assuming the Business Combination Proposal, the Domestication Proposal and the Organizational Documents Proposals are approved and adopted, the election of directors who, upon consummation of the Business Combination, will be the
directors of the Surviving Corporation (the Director Election Proposal), to be effective as of the Closing;
|
•
|
consider and vote upon a proposal to approve by ordinary resolution for purposes of complying with the applicable provisions
of Nasdaq Listing Rule 5635 and assuming the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposals and the Director Election Proposal are approved and adopted, the issuance of Surviving
Corporation Common Stock to the H2B2 Securityholders pursuant to the Merger Agreement (Stock Issuance Proposal), to be effective prior to or substantially concurrently with the Closing;
|
•
|
consider and vote upon a proposal to approve by ordinary resolution, assuming the Business Combination Proposal, the
Domestication Proposal, the Organizational Documents Proposals, the Director Election Proposal and the Stock Issuance Proposal are approved and adopted, the Incentive Plan (Equity Incentive Plan Proposal), to be effective as of the
Closing;
|
•
|
consider and vote upon a proposal to approve by ordinary resolution, the adjournment of the Special Meeting to a later date
or dates, if necessary, (i) to permit further solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more proposals at the Special Meeting or (ii) if the RMG III Board determines
before the Special Meeting that it is not necessary or no longer desirable to proceed with the proposals (Adjournment Proposal), to be effective as of the date of the Special Meeting.
|
•
|
you may send another proxy card with a later date;
|
•
|
you may notify RMG III’s Secretary in writing before the Special Meeting that you have revoked your proxy; or
|
•
|
you may attend the Special Meeting and vote electronically by visiting and entering the control number found on your proxy card,
instruction form or notice you previously received. Attendance at the Special Meeting will not, in and of itself, revoke a proxy.
|
•
|
(a) hold Public Shares, or (b) if you hold Public Shares through RMG III Units, you elect to separate such units into the
underlying Public Shares and RMG III Public Warrants prior to exercising your redemption rights with respect to the Public Shares;
|
•
|
submit a written request to Continental, RMG III’s transfer agent, that RMG III redeem all or a portion of your Public Shares
for cash; and
|
•
|
tender or deliver your Public Shares (and share certificates (if any) and other redemption forms) to Continental, RMG III’s
transfer agent, electronically through DTC.
|
•
|
Prominence, Predictability and Flexibility of Delaware Law. For many years, Delaware
has followed a policy of encouraging incorporation in its state and, in furtherance of that policy, has been a leader in adopting, construing, and implementing comprehensive, flexible corporate laws responsive to the legal and business
needs of corporations organized under its laws. Many corporations have chosen Delaware initially as a state of incorporation or have subsequently changed corporate domicile to Delaware. Because of Delaware’s prominence as the state of
incorporation for many major corporations, both the
|
•
|
Well-Established Principles of Corporate Governance. There is substantial judicial
precedent in the Delaware courts as to the legal principles applicable to measures that may be taken by a corporation and to the conduct of a company’s board of directors, such as under the business judgment rule and other standards.
Because the judicial system is based largely on legal precedents, the abundance of Delaware case law provides clarity and predictability to many areas of corporate law. RMG III believes such clarity would be advantageous to the
Surviving Corporation, the Surviving Corporation Board and management to make corporate decisions and take corporate actions with greater assurance as to the validity and consequences of those decisions and actions. Further, investors
and securities professionals are generally more familiar with Delaware corporations and the laws governing such corporations, increasing their level of comfort with Delaware corporations relative to other jurisdictions. The Delaware
courts have developed considerable expertise in dealing with corporate issues, and a substantial body of case law has developed construing Delaware law and establishing public policies with respect to corporate legal affairs. Moreover,
Delaware’s vast body of law on the fiduciary duties of directors provides appropriate protection for the Surviving Corporation stockholders from possible abuses by directors and officers.
|
•
|
Increased Ability to Attract and Retain Qualified Directors. Reincorporation from the
Cayman Islands to Delaware is attractive to directors, officers and shareholders alike. The Surviving Corporation’s incorporation in Delaware may make the Surviving Corporation more attractive to future candidates for its board of
directors, because many such candidates are already familiar with Delaware corporate law from their past business experience. To date, RMG III has not experienced difficulty in retaining directors or officers, but directors of public
companies are exposed to significant potential liability. Thus, candidates’ familiarity and comfort with Delaware laws — especially those relating to director indemnification (as discussed below) — draw such qualified candidates to
Delaware corporations. The RMG III Board, therefore, believes that providing the benefits afforded directors by Delaware law will enable the Surviving Corporation to compete more effectively with other public companies in the
recruitment of talented and experienced directors and officers.
|
|
| |
RMG III Governing Documents
|
| |
The Proposed Organizational Documents
|
Authorized Shares
(Proposal A)
|
| |
The RMG III Governing Documents authorize 555,000,000 shares, consisting of
500,000,000 RMG III Class A Ordinary Shares, 50,000,000 RMG III Class B Ordinary Shares and 5,000,000 preference shares.
See paragraph 5 of the Existing Memorandum.
|
| |
The Proposed Organizational Documents authorize shares, consisting of
shares of Surviving Corporation Common Stock and shares of Surviving Corporation Preferred Stock.
See Article IV of the Proposed Certificate
of Incorporation.
|
|
| |
|
| |
|
Authorize the Board of Directors to Issue Preferred Stock Without Stockholder
Consent
(Proposal B)
|
| |
The RMG III Governing Documents authorize the issuance of 5,000,000
preference shares with such designation, rights and preferences as may be determined from time to time by the RMG III Board. Accordingly, the RMG III Board is empowered under the RMG III Governing Documents, without RMG III
shareholder approval, to issue preferred shares with dividend, liquidation, redemption, voting or other rights which could adversely affect the voting power or other rights of the holders of RMG III Ordinary Shares (except to the
extent it may affect the ability of RMG III to carry out a conversion of RMG III Class B Ordinary Shares on the Closing Date, as contemplated by the Existing Articles).
|
| |
The Proposed Organizational Documents authorize the Surviving Corporation
Board to issue all or any shares of preferred stock in one or more series and to fix for each such series such voting powers, full or limited, and such designations, preferences and relative, participating, optional or other special
rights and such qualifications, limitations, or restrictions thereof, as the Surviving Corporation Board may determine.
See Article IV subsection (B) of the Proposed
Certificate of Incorporation.
|
|
| |
RMG III Governing Documents
|
| |
The Proposed Organizational Documents
|
|
| |
See paragraph 5 of the Existing Memorandum and Article 3
of the Existing Articles.
|
| |
|
|
| |
|
| |
|
Classified Board
(Proposal C)
|
| |
The RMG III Governing Documents contain a provision that provides for a
classified board.
See Article 27.2 of the Existing Memorandum.
|
| |
The Proposed Organizational Documents do not contain a provision that
provides for a classified board.
|
Corporate Name
(Proposal D)
|
| |
The RMG III Governing Documents provide that the name of the company is “RMG
Acquisition Corp. III.”
See paragraph 1 of the Existing Memorandum.
|
| |
The Proposed Organizational Documents provide that the name of the
corporation will be “H2B2 Electrolysis Technologies, Inc.”
See Article I of the Proposed Certificate
of Incorporation.
|
|
| |
|
| |
|
Perpetual Existence
(Proposal D)
|
| |
The RMG III Governing Documents provide that if RMG III does not consummate a
business combination (as defined in the RMG III Governing Documents) by February 9, 2024 (or such later time as the RMG III shareholders may approve in accordance with the RMG III Governing Documents), RMG III will cease all
operations except for the purposes of winding up and will redeem the Public Shares and liquidate the Trust Account.
See Article 49.7 of the Existing Articles.
|
| |
The Proposed Organizational Documents do not include any provisions relating
to the Surviving Corporation’s ongoing existence; the default under the DGCL will make the Surviving Corporation’s existence perpetual.
Default rule under the DGCL.
|
|
| |
|
| |
|
Exclusive Forum
(Proposal D)
|
| |
The RMG III Governing Documents do not contain a provision adopting an
exclusive forum for certain shareholder litigation.
|
| |
The Proposed Organizational Documents adopt Delaware as the exclusive forum
for certain stockholder litigation.
See Article X of the Proposed Certificate
of Incorporation.
|
|
| |
|
| |
|
Takeovers by Interested
Stockholders
(Proposal D)
|
| |
The RMG III Governing Documents do not provide restrictions on takeovers of
RMG III by a related shareholder following a business combination.
|
| |
The Proposed Organizational Documents will have the Surviving Corporation
governed by Section 203 of the DGCL relating to takeovers by interested stockholders.
Default rule under the DGCL.
|
|
| |
|
| |
|
Provisions Related to Status as Blank Check Company
(Proposal D)
|
| |
The RMG III Governing Documents include various provisions related to RMG
III’s status as a blank check company prior to the consummation of a business combination.
See the RMG III Governing Documents.
|
| |
The Proposed Organizational Documents do not include such provisions related
to RMG III’s status as a blank check company, which no longer will apply upon consummation of the Merger, as RMG III will cease to be a blank check company at such time.
|
•
|
Stock Options and SARs. The plan administrator may determine the number of shares to be
covered by each option and/or SAR, the exercise price and such other terms, conditions, and limitations, including the vesting, exercise, term and forfeiture provisions, applicable to each option and/or SAR as it deems necessary or
advisable. Stock options provide for the purchase of shares of Surviving Corporation Common Stock in the future at an exercise price set on the grant date. Options granted under the Incentive Plan may be either ISOs or NSOs. ISOs, in
contrast to NSOs, may provide tax deferral beyond exercise and favorable capital gains tax treatment to their holders if certain holding period and other requirements of the Code. SARs entitle their holder, upon exercise, to receive
from us an amount equal to the appreciation of the shares subject to the award between the grant date and the exercise date. The exercise price of an option or SAR is determined by the plan administrator at the time of grant but shall
not be less than 100% of the fair market value of the underlying shares on the grant date, or in the case of ISOs granted to an employee who owns more than 10% of the Surviving Corporation, 110% of the fair market value of the
underlying shares on the day of such grant. Stock options and SARs may have a maximum term of ten years, or, in the case of ISOs granted to an employee who owns more than 10% of the Surviving Corporation, five years from the date of
grant. No dividends or dividend equivalents will be payable with respect to stock options or SARs.
|
•
|
Restricted Stock. Restricted stock is an award of shares of Surviving Corporation
Common Stock that are subject to certain vesting conditions and other restrictions and that are nontransferable prior to vesting. The plan administrator may determine the terms and conditions of restricted stock awards, including the
number of shares awarded, the purchase price, if any, to be paid by the recipient, the applicable vesting conditions, and any rights to acceleration thereof. The Incentive Plan provides that dividends payable with respect to restricted
stock prior to the vesting of such restricted stock instead will be paid out to the participant only as and to the extent that the applicable vesting conditions of the underlying award are subsequently satisfied and the restricted stock
vests. Dividends payable with respect to the portion of a restricted stock award that fails to vest will be forfeited.
|
•
|
RSUs. RSUs are contractual promises to deliver cash or shares of Surviving Corporation
Common Stock in the future, which may also remain forfeitable unless and until specified conditions are met. The terms and conditions applicable to RSUs are determined by the plan administrator, subject to the conditions and limitations
contained in the Incentive Plan.
|
•
|
Other Stock or Cash Based Awards. Other stock or cash based awards are awards of cash,
fully vested shares of Surviving Corporation Common Stock and other awards valued wholly or partially by reference to, or otherwise based on, shares of Surviving Corporation Common Stock. Other stock or cash based awards may be granted
to participants and may also be available as a payment form in the settlement of other awards, as standalone payments and as payment in lieu of compensation to which a participant is otherwise entitled.
|
•
|
Dividend Equivalents. Dividend equivalents represent the right to receive the
equivalent value of dividends paid on shares of Surviving Corporation Common Stock and may be granted alone or in tandem with awards other than stock options or SARs. Dividend equivalents are credited as of the dividend record dates
during the period between the date an award is granted and the date such award vests, is exercised, is distributed or expires, as determined by the plan administrator. Under the Incentive Plan, dividend equivalents payable with respect
to an award shall only be paid to a participant to the extent that the vesting conditions of the underlying award are subsequently satisfied and the award vests. Dividend equivalents payable with respect to the portion of the award that
fails to vest will be forfeited.
|
•
|
consider and vote upon the Warrant Amendment Proposal; and
|
•
|
consider and vote upon the Warrant Holders Adjournment Proposal (together with the Warrant Amendment Proposal, the “Warrant Holder Proposal”) to be effective as of the date of the Warrant Holders Meeting.
|
•
|
you may send another proxy card with a later date;
|
•
|
you may notify RMG III’s Secretary in writing before the Warrant Holders Meeting that you have revoked your proxy; or
|
•
|
you may attend the Warrant Holders Meeting and vote electronically by visiting and entering the control number found on your
proxy card, instruction form or notice you previously received. Attendance at the Warrant Holders Meeting will not, in and of itself, revoke a proxy.
|
•
|
in whole and not in part;
|
•
|
at a price of $0.01 per Public Warrant;
|
•
|
upon not less than 30 days’ prior written notice of redemption to each Public Warrant holder; and
|
•
|
if and only if the last reported sale price of the RMG III Class A Ordinary Shares for any 20 trading days within a 30-trading
day period ending on the third trading day prior to the date on which RMG III sends the notice of redemption to the Public Warrant holders equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable
upon exercise or the exercise price of a Public Warrant. See “ – Anti-dilution Adjustments”).
|
•
|
This proxy statement/prospectus discloses the possibility that the Sponsor, RMG III’s directors, executive officers, advisors or
any of their respective affiliates may purchase RMG III Class A Ordinary Shares outside the redemption process, along with the purpose of such purchases;
|
•
|
If the Sponsor, RMG III’s directors, executive officers, advisors or any of their respective affiliates were to purchase RMG III
Class A Ordinary Shares:
|
○
|
the Sponsor and such directors, executive officers, advisors or affiliates would do so at a price
no higher than the price offered through the redemption process;
|
○
|
such purchased RMG III Class A Ordinary Shares would not be voted in favor of approving the
Business Combination;
|
○
|
the Sponsor and such directors, executive officers, advisors or affiliates would not possess any
redemption rights with respect to such purchased RMG III Class A Ordinary Shares or, if they do acquire and possess redemption rights, they would waive such rights; and
|
•
|
RMG III would disclose in a Current Report on Form 8-K, before the Special Meeting, the following:
|
○
|
the amount of RMG III Class A Ordinary Shares purchased outside of the redemption offer by the
Sponsor, RMG III’s directors, executive officers, advisors or any of their respective affiliates, along with the purchase price;
|
○
|
the purpose of such purchases;
|
○
|
the impact, if any, of such purchases on the likelihood that a business combination will be
approved;
|
○
|
the identities of our selling shareholders for such purchases (if not purchased on the open
market) or the nature of our stockholders (e.g., 5% stockholders) who sold to the Sponsor, RMG III’s directors, executive officers, advisors or any of their respective affiliates; and
|
○
|
the number of our RMG III Class A Ordinary Shares for which we have received redemption requests
pursuant to the redemption offer.
|
Name
|
| |
Age
|
| |
Title
|
Robert S. Mancini
|
| |
66
|
| |
Chairman and Chief Executive Officer
|
Philip Kassin
|
| |
66
|
| |
President, Chief Operating Officer and Director
|
D. James Carpenter
|
| |
55
|
| |
Executive Vice President
|
Wesley Sima
|
| |
35
|
| |
Chief Financial Officer
|
Craig Broderick
|
| |
64
|
| |
Director
|
W. Thaddeus Miller
|
| |
72
|
| |
Director
|
Catherine D. Rice
|
| |
64
|
| |
Director
|
•
|
assisting board oversight of (i) the integrity of our financial statements, (ii) our compliance with legal and regulatory
requirements, (iii) our independent auditor’s qualifications and independence, and (iv) the performance of our internal audit function and independent auditors;
|
•
|
the appointment, compensation, retention, replacement and oversight of the work of the independent auditors and any other
independent registered public accounting firm engaged by RMG III;
|
•
|
pre-approving all audit and non-audit services to be provided by the independent auditors or any other registered public
accounting firm engaged by us, and establishing pre-approval policies and procedures;
|
•
|
reviewing and discussing with the independent auditors all relationships the auditors have with us in order to evaluate their
continued independence;
|
•
|
setting clear hiring policies for employees or former employees of the independent auditors;
|
•
|
setting clear policies for audit partner rotation in compliance with applicable laws and regulations;
|
•
|
obtaining and reviewing a report, at least annually, from the independent auditors describing (i) the independent auditor’s
internal quality-control procedures and (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional
authorities, within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues;
|
•
|
meeting to review and discuss our annual audited financial statements and quarterly financial statements with management and the
independent auditor, including reviewing our specific disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations”;
|
•
|
reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K
promulgated by the SEC prior to us entering into such transaction; and
|
•
|
reviewing with management, the independent auditors, and our legal advisors, as appropriate, any legal, regulatory or compliance
matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant
changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities.
|
•
|
reviewing and approving on an annual basis the corporate goals and objectives relevant to the Chief Executive Officer’s
compensation, evaluating the Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of the Chief Executive Officer based on such evaluation;
|
•
|
reviewing and making recommendations to RMG III Board with respect to the compensation, and any incentive-compensation and
equity-based plans that are subject to board approval, of all of its other officers;
|
•
|
reviewing the executive compensation policies and plans;
|
•
|
implementing and administering the incentive compensation equity-based remuneration plans;
|
•
|
assisting management in complying with the proxy statement/prospectus and annual report disclosure requirements;
|
•
|
approving all special perquisites, special cash payments and other special compensation and benefit arrangements for the
officers and employees;
|
•
|
producing a report on executive compensation to be included in the annual proxy statement/prospectus; and
|
•
|
reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.
|
•
|
identifying, screening and reviewing individuals qualified to serve as directors, consistent with criteria approved by RMG III
Board, and recommending to RMG III Board candidates for nomination for appointment at the annual general meeting or to fill vacancies on RMG III Board;
|
•
|
developing and recommending to RMG III Board and overseeing implementation of our corporate governance guidelines;
|
•
|
coordinating and overseeing the annual self-evaluation of RMG III Board, its committees, individual directors and management in
the governance of the company; and
|
•
|
reviewing on a regular basis our overall corporate governance and recommending improvements as and when necessary.
|
•
|
duty to act in good faith in what the director or officer believes to be in the best interests of the company as a whole;
|
•
|
duty to exercise authority for the purpose for which it is conferred;
|
•
|
duty to not improperly fetter the exercise of future discretion;
|
•
|
duty not to put themselves in a position in which there is a conflict between their duty to the company and their personal
interests; and
|
•
|
duty to exercise independent judgment.
|
•
|
None of the directors or officers is required to commit his or her full time to our affairs and, accordingly, may have conflicts
of interest in allocating his or her time among various business activities.
|
•
|
In the course of their other business activities, the officers and directors may become aware of investment and business
opportunities that may be appropriate for presentation to us as well as the other entities with which they are affiliated. The management may have conflicts of interest in determining to which entity a particular business opportunity
should be presented.
|
•
|
RMG III’s Initial Shareholders, officers and directors have agreed to waive their redemption rights with respect to any Founder
Shares and Public Shares held by them in connection with the consummation of an initial business combination. Additionally, the Initial Shareholders have agreed to waive their redemption
|
•
|
The officers and directors may negotiate employment or consulting agreements with a target business in connection with a
particular business combination. These agreements may provide for them to receive compensation following an initial business combination and as a result, may cause them to have conflicts of interest in determining whether to proceed
with a particular business combination.
|
•
|
The officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the
retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination.
|
•
|
The conflicts described above may not be resolved in RMG III’s favor.
|
Individual
|
| |
Entity
|
| |
Entity’s Business
|
| |
Affiliation
|
Robert S. Mancini
|
| |
—
|
| |
—
|
| |
—
|
|
| |
|
| |
|
| ||
Philip Kassin
|
| |
—
|
| |
—
|
| |
—
|
|
| |
|
| |
|
| ||
D. James Carpenter
|
| |
Riverside Management Group, LLC
|
| |
Merchant Bank
|
| |
Founder & CEO
|
|
| |
|
| |
|
| ||
Craig Broderick
|
| |
Goldman, Sachs & Co.
|
| |
Investment Bank
|
| |
Senior Director
|
|
| |
|
| |
|
| |
|
|
| |
Bank of Montreal
|
| |
Investment Bank
|
| |
Director
|
|
| |
|
| |
|
| ||
|
| |
McDermott International
|
| |
Engineering and Construction Company
|
| |
Director
|
|
| |
|
| |
|
| |
|
|
| |
Circle Financial International
|
| |
Stablecoin Company
|
| |
Director
|
|
| |
|
| |
|
| |
|
Individual
|
| |
Entity
|
| |
Entity’s Business
|
| |
Affiliation
|
W. Thaddeus Miller
|
| |
Calpine Corporation
|
| |
Energy Services
|
| |
Executive Vice Chairman & Board Member
|
|
| |
|
| |
|
| ||
Catherine D. Rice
|
| |
BrightSpire Capital
|
| |
Real Estate
|
| |
Director
|
|
| |
|
| |
|
| ||
|
| |
Urban Edge
|
| |
|
| |
|
|
| |
September 30,
2023
|
| |
December 31,
2022
|
|
| |
Unaudited
|
| |
|
Assets:
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash
|
| |
$310,838
|
| |
$22,339
|
Prepaid expenses
|
| |
51,374
|
| |
50,892
|
Total current assets
|
| |
362,212
|
| |
73,231
|
Cash and investments held in Trust Account
|
| |
6,655,195
|
| |
487,268,822
|
Total Assets
|
| |
$7,017,407
|
| |
$487,342,053
|
Liabilities, Class A Ordinary Shares
Subject to Possible Redemption and Shareholders’ Deficit:
|
| |
|
| |
|
Current liabilities:
|
| |
|
| |
|
Accounts payable
|
| |
$33,367
|
| |
$153,571
|
Accrued expenses
|
| |
7,600,457
|
| |
899,845
|
Accrued expenses - related party
|
| |
240,000
|
| |
120,000
|
Total current liabilities
|
| |
7,873,824
|
| |
1,173,416
|
Deferred legal fees
|
| |
250,000
|
| |
250,000
|
Deferred underwriting commissions
|
| |
6,762,000
|
| |
16,905,000
|
Convertible working capital loan - related party
|
| |
850,000
|
| |
500,000
|
Derivative warrant liabilities
|
| |
2,323,923
|
| |
536,300
|
Total liabilities
|
| |
18,059,747
|
| |
19,364,716
|
Commitments and Contingencies
|
| |
|
| |
|
Class A ordinary shares; 635,778 and 48,300,000 shares
subject to possible redemption at $10.00 and $10.09 per share at September 30, 2023 and December 31, 2022, respectively
|
| |
6,357,780
|
| |
487,168,822
|
Shareholders’ Deficit:
|
| |
|
| |
|
Preference shares, $0.0001 par value; 5,000,000 shares
authorized; none issued and outstanding at September 30, 2023 and December 31, 2022, respectively
|
| |
—
|
| |
—
|
Class A ordinary shares, $0.0001 par value; 500,000,000
shares authorized at September 30, 2023 and December 31, 2022, respectively
|
| |
—
|
| |
—
|
Class B ordinary shares, $0.0001 par value; 50,000,000
shares authorized; 12,075,000 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively
|
| |
1,208
|
| |
1,208
|
Additional paid-in capital
|
| |
9,585,984
|
| |
—
|
Accumulated deficit
|
| |
(26,987,312)
|
| |
(19,192,693)
|
Total shareholders’ deficit
|
| |
(17,400,120)
|
| |
(19,191,485)
|
Total Liabilities, Class A Ordinary
Shares Subject to Possible Redemption and Shareholders’ Deficit
|
| |
$7,017,407
|
| |
$487,342,053
|
|
| |
For the Three Months
Ended September 30,
|
| |
For the Nine Months
Ended September 30,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
General and administrative expenses
|
| |
$1,455,011
|
| |
$293,696
|
| |
$7,993,065
|
| |
$1,408,870
|
Loss from operations
|
| |
(1,455,011)
|
| |
(293,696)
|
| |
(7,993,065)
|
| |
(1,408,870)
|
Other income:
|
| |
|
| |
|
| |
|
| |
|
Change in fair value of derivative liabilities
|
| |
(355,739)
|
| |
(697,008)
|
| |
(1,787,623)
|
| |
12,181,745
|
Reduction in deferred underwriter commissions
|
| |
—
|
| |
—
|
| |
440,592
|
| |
—
|
Interest income - bank
|
| |
1,048
|
| |
—
|
| |
1,330
|
| |
—
|
Interest expense
|
| |
—
|
| |
(2,468)
|
| |
—
|
| |
(6,614)
|
Investment income earned on cash and investments held
in Trust Account
|
| |
63,138
|
| |
2,179,997
|
| |
1,562,977
|
| |
2,880,650
|
Total other (expense) income, net
|
| |
(291,553)
|
| |
1,480,521
|
| |
217,276
|
| |
15,055,781
|
Net (loss) income
|
| |
$(1,746,564)
|
| |
$1,186,825
|
| |
$(7,775,789)
|
| |
$13,646,911
|
Weighted average Class A ordinary shares, basic and
diluted
|
| |
743,298
|
| |
48,300,000
|
| |
2,768,541
|
| |
48,300,000
|
Basic and diluted net (loss) income
per ordinary share, Class A
|
| |
$(0.14)
|
| |
$0.02
|
| |
$(0.52)
|
| |
$0.23
|
Weighted average Class B ordinary shares, basic and
diluted
|
| |
12,075,000
|
| |
12,075,000
|
| |
12,075,000
|
| |
12,075,000
|
Basic and diluted net (loss) income
per ordinary share, Class B
|
| |
$(0.14)
|
| |
$0.02
|
| |
$(0.52)
|
| |
$0.23
|
|
| |
For the Nine Months Ended September 30,
|
|||
|
| |
2023
|
| |
2022
|
Cash Flows from Operating Activities:
|
| |
|
| |
|
Net (loss) income
|
| |
$(7,775,789)
|
| |
$13,646,911
|
Adjustments to reconcile net (loss) income to net cash
used in operating activities:
|
| |
|
| |
|
Change in fair value of derivative liabilities
|
| |
1,787,623
|
| |
(12,181,745)
|
Interest expense
|
| |
—
|
| |
6,614
|
Investment income earned on cash and investments held in Trust Account
|
| |
(1,562,977)
|
| |
(2,880,650)
|
Reduction in deferred underwriting commissions
|
| |
(440,592)
|
| |
—
|
Changes in operating assets and liabilities:
|
| |
|
| |
|
Prepaid expenses
|
| |
(482)
|
| |
400,249
|
Accounts payable
|
| |
(120,204)
|
| |
62,745
|
Accrued expenses - related party
|
| |
120,000
|
| |
60,000
|
Accrued expenses
|
| |
6,700,612
|
| |
351,153
|
Net cash used in operating activities
|
| |
(1,291,809)
|
| |
(534,723)
|
Cash Flows from Investing Activities:
|
| |
|
| |
|
Cash withdrawn from Trust Account for working capital purposes
|
| |
1,230,308
|
| |
27,010
|
Cash withdrawn from Trust Account in connection with redemption
|
| |
480,946,296
|
| |
—
|
Net cash provided by investing activities
|
| |
482,176,604
|
| |
27,010
|
Cash Flows from Financing Activities:
|
| |
|
| |
|
Proceeds from convertible promissory note - related party
|
| |
350,000
|
| |
500,000
|
Redemption of common stock
|
| |
(480,946,296)
|
| |
—
|
Net cash (used in) provided by financing activities
|
| |
(480,596,296)
|
| |
500,000
|
Net increase (decrease)in cash
|
| |
288,499
|
| |
(7,713)
|
Cash - beginning of the period
|
| |
22,339
|
| |
93,599
|
Cash - end of the period
|
| |
$310,838
|
| |
$85,886
|
Supplemental disclosure of non-cash investing and
financing activities:
|
| |
|
| |
|
Change Increase in value of Class A common stock
subject to possible redemption
|
| |
$135,254
|
| |
$2,765,952
|
Reduction in deferred underwriting fee payable
|
| |
$9,702,408
|
| |
—
|
•
|
Base Purchase Price. Removal of the definition of Base Purchase Price.
|
•
|
Closing Date Purchase Price. Amendment to the definition of Closing Date
Purchase Price to a fixed purchase price of $400,000,000.
|
•
|
AVR Option Amount. Removal of the AVR Option Amount from the calculation of
the Closing Date Purchase Price and Minimum Investment Amount as a result of the agreement between the current Chairman of the Board of Directors of H2B2, Mr. Vázquez, and H2B2 to delay the exercise of Mr. Vázquez’s option to acquire
up to 68,966 shares of Company Common Stock, to after closing of the Merger.
|
•
|
Minimum Investment Amount. Reduction of the Minimum Investment Amount from
$40,000,000 to $30,000,000.
|
•
|
10% Premium. Removal of the ten percent (10%) premium to the Closing Date
Purchase Price in the event that the Capital Raise Amount exceeded $15,000,000 from the definition of Closing Date Purchase Price.
|
•
|
Minimum Net Tangible Assets Condition. Removal of the condition precedent to
closing of the Merger that RMG III will have at least $5,000,001 of net tangible assets upon closing of the Merger (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act).
|
•
|
Conversion of RMG III Class B Ordinary Shares. Amendment to the definition of
Founder Consideration Shares and other related sections of the Merger Agreement to reflect the planned partial conversion by Sponsor of certain RMG III Class B Ordinary Shares into RMG III Class A Ordinary Shares prior to closing of
the Merger.
|
•
|
Warrant Amendment. Amendment to the covenant relating to the Warrant
Amendment to clarify that RMG III will, following its execution, cause, in connection with the Closing, each of the then outstanding Public Warrants and Private Placement Warrants to represent the right to receive up to 0.075 shares
of Surviving Corporation Common Stock.
|
•
|
Director Nominees. Amendment to the covenant relating to the composition of
the Surviving Corporation Board to provide that, immediately following the Effective Time, the Surviving Corporation Board will consist of nine (9) directors, which will initially include (i) six (6) director nominees, each of whom
will be independent directors for the purposes of Nasdaq, five (5) of whom to be designated by H2B2 and one (1) of whom to be designated by RMG III, and (ii) three (3) director nominees to be designated by H2B2.
|
•
|
each person who is, or is expected to be, the beneficial owner of more than 5% of the outstanding shares of common stock of RMG
III or the Surviving Corporation, as applicable;
|
•
|
each of RMG III’s current directors and executive officers;
|
•
|
each person who will become a director or executive officer of the Surviving Corporation; and
|
•
|
all directors and officers of RMG III, as a group, and of the Surviving Corporation, as a group.
|
|
| |
Before the
Business Combination
|
| |
After the Business Combination
|
||||||||||||
|
| |
Pro Forma Combined
(Assuming No
Redemption)
|
| |
Pro Forma Combined
(Assuming Maximum
Redemption)(1)
|
||||||||||||
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
| |
Number of
Shares
|
| |
%
Ownership
|
Name of Beneficial Owner
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
RMG III
Directors and Executive Officers Pre-Business Combination
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Robert S. Mancini
|
| |
12,075,000(2)(3)
|
| |
95.00%
|
| |
2,124,593
|
| |
4.86%
|
| |
2,084,011
|
| |
4.85%
|
Philip Kassin
|
| |
12,075,000(2)(3)
|
| |
95.00%
|
| |
2,124,593
|
| |
4.86%
|
| |
2,084,011
|
| |
4.85%
|
D. James Carpenter
|
| |
12,075,000(2)(3)
|
| |
95.00%
|
| |
2,124,593
|
| |
4.86%
|
| |
2,084,011
|
| |
4.85%
|
Wesley Sima
|
| |
—(4)
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Craig Broderick
|
| |
—(4)
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
W. Thaddeus Miller
|
| |
—(4)
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Catherine D. Rice
|
| |
—(4)
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
All officers and directors as a group (7 individuals)
|
| |
12,075,000
|
| |
95.00%
|
| |
2,124,593
|
| |
4.86%
|
| |
2,084,011
|
| |
4.85%
|
RMG III Company
Five Percent Holders Pre-Business Combination
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Sponsor
|
| |
12,075,000(2)(3)
|
| |
95.00%
|
| |
2,124,593
|
| |
4.86%
|
| |
2,084,011
|
| |
4.85%
|
Surviving
Corporation Directors and Executive Officers Post-Business Combination
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Blanca de Porres Guardiola(5)
|
| |
—
|
| |
—
|
| |
3,361,418
|
| |
7.70%
|
| |
3,361,418
|
| |
7.82%
|
África Castro Rosende(6)
|
| |
—
|
| |
—
|
| |
955,240
|
| |
2.19%
|
| |
955,240
|
| |
2.22%
|
Blanca Benjumea de Porres(7)
|
| |
—
|
| |
—
|
| |
218,602
|
| |
0.50%
|
| |
218,602
|
| |
0.51%
|
Anselmo Andrade Fernández de Mesa(8)
|
| |
—
|
| |
—
|
| |
406,638
|
| |
0.93%
|
| |
406,638
|
| |
0.95%
|
Felipe Benjumea de Porres(9)
|
| |
—
|
| |
—
|
| |
405,116
|
| |
0.93%
|
| |
405,116
|
| |
0.94%
|
Antonio Vazquez Romero(10)
|
| |
—
|
| |
—
|
| |
15,765
|
| |
0.04%
|
| |
15,765
|
| |
0.04%
|
José Javier Brey Sánchez(11)
|
| |
—
|
| |
—
|
| |
3,471,388
|
| |
7.95%
|
| |
3,471,388
|
| |
8.07%
|
Manuel Delclaux Lezama(12)
|
| |
—
|
| |
—
|
| |
1,566,418
|
| |
3.59%
|
| |
1,566,418
|
| |
3.64%
|
Guillermo Delclaux Lezama(13)
|
| |
—
|
| |
—
|
| |
1,566,418
|
| |
3.59%
|
| |
1,566,418
|
| |
3.64%
|
Robert S. Mancini(2)(3)
|
| |
12,075,000
|
| |
95.00%
|
| |
2,124,593
|
| |
4.86%
|
| |
2,084,011
|
| |
4.85%
|
Iván E. Mercado
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
All officers and directors as a group (11 individuals)
|
| |
—
|
| |
—
|
| |
11,482,051
|
| |
26.29%
|
| |
11,482,051
|
| |
26.70%
|
Surviving
Corporation Five Percent Holders Post-Business Combination
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Onatrium H2,S.L.(14)
|
| |
—
|
| |
—
|
| |
9,346,397
|
| |
21.40%
|
| |
9,346,397
|
| |
21.73%
|
Ardachon, S.L.(15)
|
| |
—
|
| |
—
|
| |
7,595,020
|
| |
17.39%
|
| |
7,595,020
|
| |
17.66%
|
Luján Aresti Llorente(16)
|
| |
—
|
| |
—
|
| |
2,763,369
|
| |
6.33%
|
| |
2,763,369
|
| |
6.43%
|
Empelia Capital, S.L.(17)
|
| |
—
|
| |
—
|
| |
3,228,912
|
| |
7.39%
|
| |
3,228,912
|
| |
7.51%
|
(1)
|
(1) Share ownership under each redemption scenario is only presented for illustrative purposes. RMG III cannot predict how
many of its Public Shareholders will exercise their right to have their Public Shares redeemed for cash. As a result, the RMG III Share Redemption Amount and the number of RMG III Class A Ordinary Shares redeemed in connection with
the Business Combination may differ from the amounts presented above. As such, the ownership percentages of H2B2 Stockholders, Public Shareholders, Sponsor, Holders of RMG III Public Warrants and other stockholders may also differ
from the presentation above if the actual redemptions are different from these assumptions.
|
(2)
|
The Sponsor is the record holder of the shares reported herein. Each of the officers, directors and certain members of the RMG
III advisory board is or will be, directly or indirectly, a member of the Sponsor. MKC Investments LLC is the sole managing member of RMG Sponsor III, LLC, and Messrs. Carpenter, Mancini and Kassin are the managing members of MKC
Investments LLC. As such, they may be deemed to have or share beneficial ownership of the Class B Ordinary Shares held directly by the Sponsor. Each such person disclaims any beneficial ownership of the reported shares other than to
the extent of any pecuniary interest they may have therein, directly or indirectly.
|
(3)
|
Interests shown consist solely of Founder Shares, classified as RMG III Class B Ordinary Shares.
|
(4)
|
Does not include any shares indirectly owned by this individual as a result of a profit interest in the Sponsor. Each of these
individuals disclaims beneficial ownership of any shares except to the extent of their pecuniary interest therein.
|
(5)
|
Consists of 3,361,418 shares of Surviving Corporation common stock that will be held following the Business Combination.
|
(6)
|
Consists of 955,240 shares of Surviving Corporation common stock that will be held following the Business Combination.
|
(7)
|
Consists of 218,602 shares of Surviving Corporation common stock that will be held following the Business Combination.
|
(8)
|
Consists of 164,162 shares of Surviving Corporation common stock that will be held following the Business Combination. In
addition, Mr. Andrade is in the decision body of Fundación para el Microemprendimiento that will hold 242,476 shares of Surviving Corporation common stock following the Business Combination. As such, he may be deemed to have or share
beneficial ownership of the shares held by Fundación para el Microemprendimiento. The address for Fundación para el Microemprendimiento is C/ Fortuny 19 - Entresuelo, 28010 - Madrid (Spain).
|
(9)
|
Consists of 162,640 shares of Surviving Corporation common stock that will be held following the Business Combination. In
addition, Mr. Benjumea de Porres is in the decision body of Fundación para el Microemprendimiento that will hold 242,476 shares of Surviving Corporation common stock following the Business Combination. As such, he may be deemed to
have or share beneficial ownership of the shares held by Fundación para el Microemprendimiento. The address for Fundación para el Microemprendimiento is C/ Fortuny 19 - Entresuelo, 28010 - Madrid (Spain).
|
(10)
|
Consists of 15,765 shares of Surviving Corporation common stock that would be issuable upon exercise of options exercisable as
of December 21, 2023.
|
(11)
|
Empelia Capital, S.L.will hold 3,228,912 shares of Surviving Corporation common stock following the Business Combination. Jose
Javier Brey Sánchez is the sole shareholder of Empelia Capital, S.L. As a result, Mr. Brey may be deemed to beneficially own the shares held by Empelia Capital, S.L. The address for Empelia Capital, S.L. is C/ Campamento 23 E, 41018 -
Sevilla (Spain). In addition, Mr. Brey is in the decision body of Fundación para el Microemprendimiento that will hold 242,476 shares of Surviving Corporation common stock following the Business Combination. As such, he may be deemed
to have or share beneficial ownership of the shares held by Fundación para el Microemprendimiento. The address for Fundación para el Microemprendimiento is C/ Fortuny 19 - Entresuelo, 28010 - Madrid (Spain).
|
(12)
|
Consists of 1,566,418 shares of Surviving Corporation common stock that will be held indirectly through Onatrium H2, S.L.
following the Business Combination.
|
(13)
|
Consists of 1,566,418 shares of Surviving Corporation common stock that will be held indirectly through Onatrium H2, S.L.
following the Business Combination.
|
(14)
|
Consists of 9,346,397 shares of Surviving Corporation common stock that will be held following the Business Combination.
Manuel Delclaux Lezama Leguizamón and Guillermo Delclaux Lezama Leguizamón are the joint and several directors of Onatrium H2,S.L. The address for Onatrium H2,S.L. is C/ San Vicente 8 13 - Dpto 3 Bilbao 48001-Bizkaia (Spain).
|
(15)
|
Consists of 7,595,020 shares of Surviving Corporation common stock that will be held following the Business Combination.
Felipe Benjumea Lorrente is the sole shareholder of Ardachon, S.L. As a result, Mr.Benjumea Llorente may be deemed to beneficially own the shares held by Ardachon, S.L. The address for Ardachon, S.L. is C/ Fortuny 19 - Entresuelo
Derecha, 28010 - Madrid (Spain).
|
(16)
|
Consists of 2,763,369 shares of Surviving Corporation common stock that will be held following the Business Combination.
|
(17)
|
Consists of 3,228,912 shares of Surviving Corporation common stock that will be held following the Business Combination. Jose
Javier Brey Sánchez is the sole shareholder of Empelia Capital, S.L. As a result, Mr. Brey may be deemed to beneficially own the shares held by Empelia Capital, S.L. The address for Empelia Capital, S.L. is C/ Campamento 23 E, 41018 -
Sevilla (Spain).
|
•
|
Conventional Product: Currently we offer our customers this solution, which focuses on selling and installing hydrogen
facilities for third parties, which includes manufacturing and installing equipment, including electrolyzers, consulting and engineering services, EPC, and O&M services, with limited integration and specific to the needs of a
project; and
|
•
|
Integrated Product: We expect to provide a more fulsome and integrated suite of products and services that includes all the
services offered under our Conventional Product together with project development services, such as identification of opportunities, site selection, negotiating PPAs and offtake agreements, permitting, and financing solutions,
including offering PG to secure sustainable financing. Our Integrated Products will be self-developed and the majority funded by third parties, or, in some cases, we may function as a technological partner for a customer interested in
developing a green hydrogen production facility.
|
Status
|
| |
Expected Installed Capacity
|
| |
Product Type
|
| |
Description
|
Installed projects
|
| |
Approximately 3.8 MW
|
| |
Conventional Product
|
| |
PowiDian (0.11 MW), Ecopetrol and Esenttia (0.27 MW), Cepsa (0.02 MW), FM
Logistics (0.02 MW), VTT (0.02 MW), Técnicas Reunidas (0.07 MW), Ministry of Science and Innovation (Spain) (0.01 MW) and University of Valencia (0.003 MW).
|
|
| |
|
| |
Integrated Product
|
| |
Our landmark SoHyCal production facility, one of the largest green hydrogen
electrolysis production facilities in the U.S. Construction of Phase I (approximately the first 3 MW) has been completed and the plant is currently in operation.
|
Projects under construction
|
| |
Approximately 15.5 MW
|
| |
Conventional Product
|
| |
Projects under construction include GP Joule (10 MW), Redexis (2.5 MW), Serveo
(1 MW), Puerto de Vigo (1 MW) and Medha (1 MW).
|
Awarded projects(1)
|
| |
Approximately 57 MW
|
| |
Conventional Product
|
| |
Pending customer obtaining financial close, including projects, Dynamis Energy
(30 MW), Rørvik (18 MW) and GreenSwitch (3 MW).(2)
|
Status
|
| |
Expected Installed Capacity
|
| |
Product Type
|
| |
Description
|
|
| |
|
| |
Integrated Product
|
| |
We recently received a conditional use permit for Phase II of SoHyCal which
includes an additional 6 MW of electrolysis powered by a 15 MW solar facility. We are awaiting final approvals and financial close for Phase II. We are also awaiting review and approval of a separate conditional use permit for a HRS
that will be part of Phase II.
|
Potential pipeline projects(3)
|
| |
Approximately 7.4 GW
|
| |
Conventional Product
|
| |
Approximately 6.9 GW across several projects.
|
|
| |
|
| |
Integrated Product
|
| |
Approximately 0.6 GW across several projects
|
(1)
|
Projects awarded or named preferred bidder, subject to client obtaining financial close. The contract is still to be signed.
|
(2)
|
The commitment is that the plant will be operational in 2026. We have a Right of First Refusal with GreenSwitch and have helped
them with the preparation for the tender process.
|
(3)
|
Includes projects that have not been awarded yet but are at varying stages of the process, including those that (i) we have bids
out for, (ii) are at the budgetary or technological partner stage, (iii) are at the technical economical proposal or expected RFQ stage or (iv) are at the tender process or early development stage.
|
(1)
|
SoHyCal Phase I has an electrolysis capacity of 1,290 kg per day of hydrogen, and once Phase II is completed, SoHyCal is expected
to have an electrolysis capacity of 3,000 kg or more of hydrogen per day.
|
(2)
|
Important Projects of Common European Interest.
|
(3)
|
Hydrogen Refueling Stations.
|
•
|
Opening our state-of-the-art manufacturing facility in Seville, Spain;
|
•
|
Leasing and finalizing preparation of a 9,700 m2 facility in Jhajjar, India that serves as a
manufacturing facility with an expected production capacity of 100 MW per year in connection with our GreenH joint venture. We estimate the plant to be operational in Q1 2024;
|
•
|
Entering into a framework agreement with Ecopetrol to analyze the development of manufacturing facilities in Colombia to support
Ecopetrol’s hydrogen plan; and
|
•
|
Signing a memorandum of understanding with Enel for the building of a manufacturing facility in northern Spain that is expected
to have at least 40 MW capacity.
|
1.
|
Containerized solutions for those units up to approximately 15–20 MW. These solutions are plug-and-play. Our product portfolio
for the containerized solutions include:
|
|
| |
|
| |
|
| |
Small-scale containerized system
|
| |
|
|
|
| |
|
| |
•
|
| |
Capacity of 3.2–12 kilowatts (“kW”)
|
| |||
|
| |
|
| |
•
|
| |
Able to supply hydrogen production with a range of 0.5–2 normal cubic meter per
hour (“Nm3/h”)
|
| |||
|
| |
|
| |
•
|
| |
Optimal for small consumers (laboratories, residential, and small fleets)
|
| |||
|
| |
|
| |
•
|
| |
Integrated within a cabinet
|
| |||
|
| |
|
| |
|
| |
|
| |||
|
| |
|
| |
|
| |
Medium-scale containerized system
|
| |
|
|
|
| |
|
| |
•
|
| |
Capacity of 50–300 kW
|
| |||
|
| |
|
| |
•
|
| |
Able to supply hydrogen production with a range of 10–60 Nm3/h
|
| |||
|
| |
|
| |
•
|
| |
These systems are integrated into 10-40 ft long containers depending on the
size of the electrolyzers and the scope of the project
|
| |||
|
| |
|
| |
|
| |
|
| |
|
|
|
| |
|
| |
|
| |
Large-scale containerized system
|
| |
|
|
|
| |
|
| |
•
|
| |
Capacity of 0.5–5 MW
|
| |
|
|
|
| |
|
| |
•
|
| |
Able to supply hydrogen with a range of 100–1,000 Nm3/h
|
| |||
|
| |
|
| |
•
|
| |
These systems are integrated into several 40 ft containers
|
|
2.
|
Skid mounted solutions for those facilities greater than 20 MW. These solutions are installed on-site and connections are made
among different components of the hydrogen facility.
|
•
|
Compressed to the final storing pressure;
|
•
|
Stored in order to have enough flow to dispense the equipment to be fueled; and
|
•
|
Dispensed to the final consumer, that could be a forklift, light- and heavy-duty vehicles, maritime or industrial and
residential use. Depending on the final use the dispensing system will vary accordingly.
|
•
|
Engineering: As soon as a project is awarded, we get involved in the development of the
basic and detailed engineering as part of the design of the equipment, including designing specifications, procedures, calculations, permit documents, tabulations, instructions, and any other document requested for the manufacturing,
commissioning and testing of the hydrogen production facilities. Most of these tasks are developed by in-house resources, although our team is able to manage and coordinate with other local engineering firms, if necessary, while keeping
our know-how confidential.
|
•
|
Procurement: We purchase all materials and equipment needed and begin contract
negotiations in parallel with our engineering team, by supporting commercial teams and leading technical aspects while supported by our engineering team. During this phase, we aim to build long-term relationships with key suppliers in
the local market.
|
•
|
Construction: We oversee on-site construction and installation of the production
facility, as well as the integration of our equipment with any third-party equipment if necessary. These tasks can be carried out by our own staff or through the hiring of subcontractors in local markets who are specialized in the
applicable area of construction. We rely on our personnel to manage any subcontractors and supervise such work to ensure it complies with our expectations related to performance, cost, timeliness, quality and health and safety
standards.
|
•
|
Commissioning and Testing: We also conduct, in coordination with our main suppliers,
commissioning of the different systems of a project and the commissioning of entire hydrogen production facilities. Finally, performance tests are conducted to ensure the production facility complies with the committed features, until
provisional acceptance is achieved, and the production facility reaches COD status.
|
•
|
PM: The customer develops the operation work plan, and we regularly visit the hydrogen
facility for approved preventative maintenance to the facilities’ main equipment and components.
|
•
|
LTSA: Tasks may include full O&M services to be provided for a hydrogen facility or
may be limited to only supervising services. Under these arrangements, we are responsible for providing guaranteed availability to the customer. Our employees are typically permanently located at the facility conducting surveillance
tasks or O&M services, depending on the customers’ needs.
|
•
|
PG: For the Integrated Product, we intend to guarantee a specific level of
the plant’s availability. We believe our offering positions us among the few green hydrogen companies capable of providing such level of assurance to our projects. Such a guarantee is of an outstanding importance in making these
projects financially viable. In order to achieve the latter, we undertake a thorough analysis of the project’s business model, taking into account the availability required by the offtaker and potential penalties, and design a
technical configuration that ensures this level of availability. This may involve sizing storage and entering into backup hydrogen contracts.
|
•
|
Self-Developed: We intend to participate in 100% of the project development and may
remain a minority stake. Under this approach, we will sell the development to a financial partner, who will fund 85% or more of the project’s construction. We may develop the project by ourselves or partner with other co-developers to
create synergies. These projects are currently focused on regulated markets such as the U.S. and Europe. Our SoHyCal production facility in California is an example of a self-developed project.
|
•
|
Third-Party Developed: We intend to position ourselves as a technology
partner for third parties interested in developing green hydrogen projects. We will retain exclusivity over the whole project and provide turnkey solutions for such third-party developers. The third party is typically the lead
developer, already having offtake agreement arrangements, but requiring technological capabilities to develop and build the project. This will sometimes be funded by the offtaker or by third-party funds. Our project with SDCL Energy
Efficiency Income Trust plc (“SDCL”) is a clear example of a third-party developed Integrated Product. In such project, we act as a technology partner to SDCL, with the overall
aim being decarbonizing cogeneration assets by introducing hydrogen as a substitute for natural gas.
|
Status
|
| |
Expected Installed
Capacity
|
| |
Product Type
|
| |
Description
|
Installed projects
|
| |
Approximately 3.8 MW
|
| |
Conventional Product
|
| |
PowiDian (0.11 MW), Ecopetrol and Esenttia (0.27 MW), Cepsa (0.02 MW), FM
Logistics (0.02 MW), VTT (0.02 MW), Técnicas Reunidas (0.07 MW), Ministry of Science and Innovation (Spain) (0.01 MW) and University of Valencia (0.003 MW).
|
|
| |
|
| |
Integrated Product
|
| |
Our landmark SoHyCal production facility, one of the largest green hydrogen
electrolysis production facilities in the U.S. Construction of Phase I (approximately the first 3 MW) has been completed and the plant is currently in operation.
|
Project under construction
|
| |
Approximately 15.5 MW
|
| |
Conventional Product
|
| |
Projects under construction include GP Joule (10 MW), Redexis (2.5 MW),
Serveo (1 MW), Puerto de Vigo (1 MW) and Medha (1 MW).
|
Awarded projects(1)
|
| |
Approximately 57 MW
|
| |
Conventional Product
|
| |
Pending customer obtaining financial close, including projects, Dynamis
Energy (30 MW), Rørvik project (18 MW) and GreenSwitch project (3 MW)(2).
|
|
| |
|
| |
Integrated Product
|
| |
We recently received a conditional use permit for Phase II of SoHyCal which
includes an additional 6 MW of electrolysis powered by a 15 MW solar facility. We are awaiting final approvals and financial close for Phase II. We are also awaiting review and approval of a separate conditional use permit for a HRS
that will be part of Phase II.
|
Potential pipeline projects(3)
|
| |
Approximately 7.4 GW
|
| |
Conventional Product
|
| |
Approximately 6.9 GW across several projects.
|
|
| |
|
| |
Integrated Product
|
| |
Approximately 0.6 GW across several projects
|
(1)
|
Projects awarded or named preferred bidder, subject to client obtaining financial close. The contract is still to be signed.
|
(2)
|
The commitment is that the plant will be operative in 2026. We have a Right of First Refusal with GreenSwitch and have helped
them with the preparation for the tender process.
|
(3)
|
Includes projects that have not been awarded yet but are at varying stages of the process, including those that (i) we have bids
out for, (ii) are at the budgetary or technological partner stage, (iii) are at the technical economical proposal or expected RFQ stage or (iv) are at the tender process or early development stage.
|
•
|
SoHyCal Project Phase I: With a capacity of 3 MW of electrolysis, SoHyCal Phase I is
powered by a biogas engine and has an electrolysis capacity of 1,290 kg/day.
|
•
|
SoHyCal Project Phase II: This phase will add an additional 6 MW of electrolysis
capacity for a total expected capacity of 9 MW. This phase is planned to be powered by a 15 MW solar plant. We received a conditional use permit for Phase II from the Fresno County Planning Commission in June 2023, but final permitting
and approvals for Phase II are still underway and are expected by Q4 2023. Phase II is also pending financial close in order to start operations. Once completed, it will have an expected electrolysis capacity of approximately 3,000 kg
or more per day. We are also awaiting review and approval of a separate conditional use permit for a HRS from the City of Fresno as part of Phase II.
|
•
|
On-site personnel taking care of the O&M of the production facility
|
•
|
Remote support from our engineering and O&M teams
|
•
|
Preventive maintenance of both spare parts and assistance
|
•
|
Corrective maintenance with recommended spare parts and assistance
|
•
|
10 Mt of renewable hydrogen production in the EU and the same quantity of imports by 2030
|
•
|
Doubling the number of hydrogen valleys through Hydrogen Joint Undertaking
|
•
|
Mapping hydrogen infrastructure needs by March 2023
|
•
|
Scaling up of electrolyzer manufacturing, details outlined in the “Electrolyzer Declaration”
|
•
|
Aligning sub-targets for RFNBOs for industry and transport
|
•
|
Defining objectives for renewable hydrogen production and establishing methodology for calculating GHG emissions of different
production methods
|
•
|
Share of renewable energy in the EU’s overall energy consumption to 42.5% with an additional 2.5% indicative top up to allow the
target of 45% to be achieved
|
•
|
A 1.6% annual increase in renewable energy usage for the industry sector and 42% of the hydrogen used in industry should come
from RFNBOs
|
•
|
Transport shall reduce emissions by 14.5%. Biofuels and RFNBO to occupy 1% of fuels in transport by 2025. 5.5% of fuels used in
transport shall be biofuels or RFNBO by 2030, with a minimum 1% RFNBO
|
•
|
RFNBO shall occupy 1.2% of the total amount of energy supplied to maritime transport section
|
•
|
Indicative target of at least a 49% renewable energy share in buildings and a binding increase for renewable energy targets for
heating and cooling of 0.8% per year at a national level until 2026 and 1.1% from 2026 to 2030
|
•
|
Faster permitting processes – national authorities will have 12 months to approve or reject new solar and wind farms if they are
in a renewable “acceleration area.” Outside these areas, the process should not exceed 24 months
|
•
|
Lease with Bar 20 Dairy, LLC of our hydrogen production facility, 1.5 acres, for a 22-year initial term that has since
commenced, with optional subsequent renewals.
|
•
|
Lease with Bar 20 Dairy, LLC for a solar plant, 40 acres, for a 22-year initial term that will commence when the solar plant is
complete, with optional subsequent renewals.
|
|
| |
Three-month period
ended September 30,
|
| |
Nine-month period
ended September 30,
|
| |
Year ended
December 31,
|
|||||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
| |
2022
|
| |
2021
|
|
| |
(unaudited)
|
| |
(unaudited)
|
| |
|
| |
|
||||||
Product sales
|
| |
$765,272
|
| |
$408,999
|
| |
$7,932,684
|
| |
$1,646,000
|
| |
$3,491,673
|
| |
$961,607
|
Cost of sales
|
| |
706,042
|
| |
372,924
|
| |
7,924,701
|
| |
1,375,548
|
| |
3,042,412
|
| |
815,956
|
Gross profit
|
| |
59,230
|
| |
36,075
|
| |
7,983
|
| |
270,452
|
| |
449,261
|
| |
145,651
|
Operating expenses:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
723,436
|
| |
251,048
|
| |
1,894,644
|
| |
908,545
|
| |
1,333,961
|
| |
588,281
|
Selling, general and administrative
|
| |
2,883,447
|
| |
835,041
|
| |
7,403,238
|
| |
2,383,248
|
| |
3,904,132
|
| |
3,220,510
|
Depreciation and amortization of long-lived assets
|
| |
51,700
|
| |
38,576
|
| |
134,151
|
| |
49,332
|
| |
88,257
|
| |
24,178
|
Income from grants
|
| |
1,004,131
|
| |
113,748
|
| |
1,709,387
|
| |
530,903
|
| |
801,991
|
| |
242,170
|
Losses from unconsolidated investments
|
| |
(124,100)
|
| |
—
|
| |
(131,132)
|
| |
—
|
| |
—
|
| |
—
|
Loss from operations
|
| |
(2,719,322)
|
| |
(974,842)
|
| |
(7,845,795)
|
| |
(2,539,770)
|
| |
(4,075,098)
|
| |
(3,445,148)
|
Other income (expense):
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Other income
|
| |
—
|
| |
—
|
| |
326,203
|
| |
411,878
|
| |
411,878
|
| |
105,979
|
Interest and financial income (expense), net
|
| |
(159,424)
|
| |
(495,677)
|
| |
(341,332)
|
| |
(1,252,200)
|
| |
(557,112)
|
| |
(757,444)
|
Total other income (expense), net
|
| |
(159,424)
|
| |
(495,677)
|
| |
(15,129)
|
| |
(840,322)
|
| |
(145,233)
|
| |
(651,465)
|
Loss before income tax expense
|
| |
(2,878,746)
|
| |
(1,470,519)
|
| |
(7,860,924)
|
| |
(3,380,092)
|
| |
(4,220,331)
|
| |
(4,096,613)
|
Income tax expense
|
| |
22,764
|
| |
16,403
|
| |
69,884
|
| |
39,643
|
| |
76,128
|
| |
34,391
|
Net loss
|
| |
(2,901,510)
|
| |
(1,486,922)
|
| |
(7,930,808)
|
| |
(3,419,735)
|
| |
(4,296,459)
|
| |
(4,131,004)
|
Less: Net loss attributable to non-controlling
interests
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(253)
|
Net loss attributable to
Stockholders
|
| |
$(2,901,510)
|
| |
$(1,486,922)
|
| |
$(7,930,808)
|
| |
$(3,419,735)
|
| |
$(4,296,459)
|
| |
$(4,130,751)
|
Net loss per share:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Net loss per share – basic
|
| |
$(0.30)
|
| |
$(0.15)
|
| |
$(0.82)
|
| |
$(0.35)
|
| |
$(0.44)
|
| |
$(0.50)
|
Net loss per share – diluted
|
| |
$(0.30)
|
| |
$(0.15)
|
| |
$(0.82)
|
| |
$(0.35)
|
| |
$(0.44)
|
| |
$(0.50)
|
Weighted average shares outstanding – basic
|
| |
9,515,008
|
| |
9,729,856
|
| |
9,621,235
|
| |
9,732,972
|
| |
9,726,763
|
| |
8,321,904
|
Weighted average shares outstanding – diluted
|
| |
9,515,008
|
| |
9,729,856
|
| |
9,621,235
|
| |
9,732,972
|
| |
9,726,763
|
| |
8,321,904
|
|
| |
As of
|
||||||
|
| |
September 30, 2023
|
| |
December 31, 2022
|
| |
December 31, 2021
|
|
| |
(unaudited)
|
| |
|
| |
|
Total assets
|
| |
$36,546,097
|
| |
$25,185,188
|
| |
$17,446,766
|
Total liabilities
|
| |
51,504,826
|
| |
16,702,754
|
| |
4,607,604
|
Total (deficit) / equity
|
| |
(14,958,729)
|
| |
8,482,434
|
| |
12,839,162
|
Total liabilities and equity
|
| |
$36,546,097
|
| |
$25,185,188
|
| |
$17,446,766
|
|
| |
Nine-month period
ended September 30,
|
| |
Year ended
December 31,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2022
|
| |
2021
|
|
| |
(unaudited)
|
| |
|
| |
|
|||
Net cash (used in)/provided by:
|
| |
|
| |
|
| |
|
| |
|
Operating activities
|
| |
$1,428,427
|
| |
$(3,032,551)
|
| |
$(4,712,637)
|
| |
$(5,411,020)
|
Investing activities
|
| |
(5,651,351)
|
| |
(408,931)
|
| |
(1,240,429)
|
| |
(1,736,570)
|
Financing activities
|
| |
10,583,576
|
| |
(28,138)
|
| |
(20,230)
|
| |
9,014,233
|
Effect of exchange rate changes on cash and cash
equivalents
|
| |
129,184
|
| |
(1,224,221)
|
| |
(526,836)
|
| |
(650,253)
|
(Decrease) increase in cash and cash
equivalents
|
| |
$6,489,836
|
| |
$(4,693,741)
|
| |
$(6,500,132)
|
| |
$1,216,390
|
•
|
Conventional Product: Currently we offer our customers this solution, which focuses on selling and installing hydrogen
facilities for third parties, which includes manufacturing and installing equipment, including electrolyzers, consulting and engineering services, EPC, and O&M services, with limited integration and specific to the needs of a
project; and
|
•
|
Integrated Product: We expect to provide a more fulsome and integrated suite of products and services that
includes all the services offered under our Conventional Product together with project development services, such as identification of opportunities, site selection, negotiating PPAs and offtake agreements, permitting, and financing
solutions, including offering production guarantees PG to secure sustainable financing. Our Integrated Products will be self-developed and the majority funded by third parties, or, in some cases, we may function as a technological
partner for a customer interested in developing a green hydrogen production facility.
|
•
|
Base Purchase Price. Removal of the definition of Base Purchase Price.
|
•
|
Closing Date Purchase Price. Amendment to the definition of Closing Date
Purchase Price to a fixed purchase price of$400,000,000.
|
•
|
AVR Option Amount. Removal of the AVR Option Amount from the calculation of
the Closing Date Purchase Price andMinimum Investment Amount as a result of the agreement between the Chairman of the Board of Directors, Mr. Vázquez,and the Company to delay the exercise of Mr. Vázquez’s option to acquire up to
68,966 shares of Company Common Stock,to after closing of the Merger.
|
•
|
Minimum Investment Amount. Reduction of the Minimum Investment Amount from
$40,000,000 to $30,000,000.
|
•
|
10% Premium. Removal of the ten percent (10%) premium to the Closing Date
Purchase Price in the event that the CapitalRaise Amount exceeded $15,000,000 from the definition of Closing Date Purchase Price.
|
•
|
Minimum Net Tangible Assets Condition. Removal of the condition precedent to
closing of the Merger that RMG III willhave at least $5,000,001 of net tangible assets upon closing of the Merger (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act).
|
•
|
Conversion of RMG III Class B Ordinary Shares. Amendment to the definition of
Founder Consideration Shares and otherrelated sections of the Merger Agreement to reflect the planned partial conversion by Sponsor of certain RMG III Class BOrdinary Shares into RMG III Class A Ordinary Shares prior to closing of the
Merger.
|
•
|
Warrant Amendment. Amendment to the covenant relating to the Warrant
Amendment to clarify that RMG III will,following its execution, cause, in connection with the Closing, each of the then outstanding Public Warrants and PrivatePlacement Warrants to represent the right to receive up to 0.075 shares of
Surviving Corporation Common Stock.
|
•
|
Director Nominees. Amendment to the covenant relating to the composition of
the Surviving Corporation Board to providethat, immediately following the Effective Time, the Surviving Corporation Board will consist of nine (9) directors, whichwill initially include (i) six (6) director nominees, each of whom will
be independent directors for the purposes of Nasdaq,five (5) of whom to be designated by the Company and one (1) of whom to be designated by RMG III, and (ii) three (3)director nominees to be designated by the Company.
|
|
| |
As of and for the
three-month period ended
September 30, 2023
|
| |
As of and for the
three-month period ended
September 30, 2022
|
||||||
Currency
|
| |
Closing
|
| |
Average
|
| |
Closing
|
| |
Average
|
|
| |
(unaudited)
|
| |
(unaudited)
|
||||||
Euro (EUR)
|
| |
0.9439
|
| |
0.9188
|
| |
1.0259
|
| |
0.9930
|
|
| |
As of and for the
nine-month period ended
September 30, 2023
|
| |
As of and for the
nine-month period ended
September 30, 2022
|
||||||
Currency
|
| |
Closing
|
| |
Average
|
| |
Closing
|
| |
Average
|
|
| |
(unaudited)
|
| |
(unaudited)
|
||||||
Euro (EUR)
|
| |
0.9439
|
| |
0.9231
|
| |
1.0259
|
| |
0.9400
|
|
| |
As of and for the year ended
December 31, 2022
|
| |
As of and for the year ended
December 31, 2021
|
||||||
Currency
|
| |
Closing
|
| |
Average
|
| |
Closing
|
| |
Average
|
|
| |
(unaudited)
|
| |
(unaudited)
|
||||||
Euro (EUR)
|
| |
0.9376
|
| |
0.9497
|
| |
0.8785
|
| |
0.8453
|
|
| |
Three-month period
ended September 30,
|
| |
Change
|
||||||
|
| |
2023
|
| |
2022
|
| |
$
|
| |
%
|
|
| |
(unaudited)
|
| |
|
| |
|
|||
Product sales
|
| |
$765,272
|
| |
$408,999
|
| |
$356,273
|
| |
87.1%
|
Cost of sales
|
| |
706,042
|
| |
372,924
|
| |
333,118
|
| |
89.3%
|
Gross profit
|
| |
59,230
|
| |
36,075
|
| |
23,155
|
| |
64.2%
|
Operating expenses:
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
723,436
|
| |
251,048
|
| |
472,388
|
| |
188.2%
|
Selling, general and administrative
|
| |
2,883,447
|
| |
835,041
|
| |
2,048,406
|
| |
245.3%
|
Depreciation and amortization of long-lived assets
|
| |
51,700
|
| |
38,576
|
| |
13,124
|
| |
34.0%
|
Income from grants
|
| |
1,004,131
|
| |
113,748
|
| |
890,383
|
| |
n.m.
|
Losses from our unconsolidated investments
|
| |
(124,100)
|
| |
—
|
| |
(124,100)
|
| |
n.m.
|
Loss from operations
|
| |
(2,719,322)
|
| |
(974,842)
|
| |
(1,744,480)
|
| |
179.0%
|
Other income (expense):
|
| |
|
| |
|
| |
|
| |
|
Interest and financial income (expense), net
|
| |
(159,424)
|
| |
(495,677)
|
| |
336,253
|
| |
(67.8)%
|
Total other income (expense), net
|
| |
(159,424)
|
| |
(495,677)
|
| |
336,253
|
| |
(67.8)%
|
Loss before income tax expense
|
| |
(2,878,746)
|
| |
(1,470,519)
|
| |
(1,408,227)
|
| |
95.8%
|
Income tax expense
|
| |
22,764
|
| |
16,403
|
| |
6,361
|
| |
38.8%
|
Net loss
|
| |
$(2,901,510)
|
| |
$(1,486,922)
|
| |
$(1,414,588)
|
| |
95.1%
|
•
|
R&D expenses increased $472,388 (188.2%) to $723,436 for the three-month
period ended September 30, 2023 from $251,048 for the three-month period ended September 30, 2022, mainly due to our sustained commitment to intensive capital investment in the period associated with the in-house development of new
technologies applicable to our electrolyzers and electrolysis processes, in line with our strategic business expansion efforts.
|
•
|
SG&A expenses increased $2,048,406 to $2,883,447 for the three-month
period ended September 30, 2023 from $835,041 for the three-month period ended September 30, 2022, the primary driver of this increase is the expenditure on professional services in the third quarter of 2023, mainly related to the
pre-Initial Public Offering services and an increase in costs associated with our expanded business operations in 2023.
|
•
|
Depreciation and amortization of long-lived assets increased
$13,124 to $51,700 for the three-month period ended September 30, 2023 from $38,576 for the three-month period ended September 30, 2022, primarily due to the increase in machinery and equipment due to the Company’s increased business
activity as compared to the same quarter of the previous year.
|
|
| |
Nine-month period
ended September 30,
|
| |
Change
|
||||||
|
| |
2023
|
| |
2022
|
| |
$
|
| |
%
|
|
| |
(unaudited)
|
| |
|
| |
|
|||
Product sales
|
| |
$7,932,684
|
| |
$1,646,000
|
| |
$6,286,684
|
| |
n.m.
|
Cost of sales
|
| |
7,924,701
|
| |
1,375,548
|
| |
6,549,153
|
| |
n.m.
|
Gross profit
|
| |
7,983
|
| |
270,452
|
| |
(262,469)
|
| |
(97.0)%
|
Operating expenses:
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
1,894,644
|
| |
908,545
|
| |
986,099
|
| |
108.5%
|
Selling, general and administrative
|
| |
7,403,238
|
| |
2,383,248
|
| |
5,019,990
|
| |
210.6%
|
Depreciation and amortization of long-lived assets
|
| |
134,151
|
| |
49,332
|
| |
84,819
|
| |
171.9%
|
Income from grants
|
| |
1,709,387
|
| |
530,903
|
| |
1,178,484
|
| |
222.0%
|
Losses from unconsolidated investments
|
| |
(131,132)
|
| |
—
|
| |
(131,132)
|
| |
n.m.
|
Loss from operations
|
| |
(7,845,795)
|
| |
(2,539,770)
|
| |
(5,306,025)
|
| |
208.9%
|
Other income (expense):
|
| |
|
| |
|
| |
|
| |
|
Other income
|
| |
326,203
|
| |
411,878
|
| |
(85,675)
|
| |
(20.8)%
|
Interest and financial income (expense), net
|
| |
(341,332)
|
| |
(1,252,200)
|
| |
910,868
|
| |
(72.7)%
|
Total other income (expense), net
|
| |
(15,129)
|
| |
(840,322)
|
| |
825,193
|
| |
(98.2)%
|
Loss before income tax expense
|
| |
(7,860,924)
|
| |
(3,380,092)
|
| |
(4,480,832)
|
| |
132.6%
|
Income tax expense
|
| |
69,884
|
| |
39,643
|
| |
30,241
|
| |
76.3%
|
Net loss
|
| |
$(7,930,808)
|
| |
$(3,419,735)
|
| |
$(4,511,073)
|
| |
131.9%
|
•
|
R&D expenses increased $986,099 (108.5%) to $1,894,644 for the nine-month
period ended September 30, 2023 from $908,545 for the nine-month period ended September 30, 2022, primarily due to our ongoing intensive capital investment endeavors in advancing our electrolyzers’ related in-house technology, in line
with our strategic business expansion efforts.
|
•
|
SG&A expenses increased $5,019,990 (210.6%) to $7,403,238 for the
nine-month period ended September 30, 2023 from $2,383,248 for the nine-month period ended September 30, 2022, primarily driven by professional services expenses in the nine-month period ended September 30, 2023, mainly related to the
pre-IPO services, and to a lesser extent due to an increase in general SG&A costs related to our incremental business activity in 2023.
|
•
|
Depreciation and amortization of long-lived assets increased
$84,819 (171.9%) to $134,151 for the nine-month period ended September 30, 2023 from $49,332 for the nine-month period ended September 30, 2022, mainly attributed to the increase in machinery and equipment due to the Company’s
heightened business operations compared to the same period in the previous year.
|
|
| |
Year ended
December 31,
|
| |
Change
|
||||||
|
| |
2022
|
| |
2021
|
| |
$
|
| |
%
|
Product sales
|
| |
$3,491,673
|
| |
$961,607
|
| |
$2,530,066
|
| |
263.1%
|
Cost of sales
|
| |
3,042,412
|
| |
815,956
|
| |
2,226,456
|
| |
272.9%
|
Gross (loss) profit
|
| |
449,261
|
| |
145,651
|
| |
303,610
|
| |
208.5%
|
Operating expenses:
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
1,333,961
|
| |
588,281
|
| |
745,679
|
| |
126.8%
|
Selling, general and administrative
|
| |
3,904,132
|
| |
3,220,510
|
| |
683,622
|
| |
21.2%
|
Depreciation of long-lived assets
|
| |
88,257
|
| |
24,178
|
| |
64,079
|
| |
265.0%
|
Income from grants
|
| |
801,991
|
| |
242,170
|
| |
559,821
|
| |
n.m.
|
Loss from operations
|
| |
(4,075,098)
|
| |
(3,445,148)
|
| |
(629,950)
|
| |
18.3%
|
Other income (expense):
|
| |
|
| |
|
| |
|
| |
|
Other income
|
| |
411,878
|
| |
105,979
|
| |
305,899
|
| |
n.m.
|
Interest and financial income (expense), net
|
| |
(557,112)
|
| |
(757,444)
|
| |
200,332
|
| |
(26.4)%
|
Total other expense, net
|
| |
(145,233)
|
| |
(651,465)
|
| |
506,232
|
| |
(77.7)%
|
Loss before tax expense
|
| |
(4,220,331)
|
| |
(4,096,613)
|
| |
(123,718)
|
| |
3.0%
|
Income tax expense
|
| |
76,128
|
| |
34,391
|
| |
41,737
|
| |
121.4%
|
Net loss
|
| |
(4,296,459)
|
| |
(4,131,004)
|
| |
(165,455)
|
| |
4.0%
|
Less: Net loss attributable to non-controlling interests
|
| |
—
|
| |
(253)
|
| |
253
|
| |
n.m.
|
Net loss attributable to Stockholders
|
| |
$(4,296,459)
|
| |
$(4,130,751)
|
| |
$(165,708)
|
| |
4.0%
|
•
|
R&D expenses increased $745,679 (126.8%) to $1,333,961 for the year ended
December 31, 2022 from $588,281 for the year ended December 31, 2021, mainly due to the intensive capital investment in the year associated with the in-house development of new technologies applicable to our electrolyzers and
electrolysis processes to accompany and sustain our business expansion, pursuing our main business goal of becoming a leading developer and operator of green hydrogen facilities.
|
•
|
SG&A expenses increased $683,622 (21.2%) to $3,904,132 for the year ended
December 31, 2022 from $3,220,510 for the year ended December 31, 2021, mainly due to professional services in the year totaling $1,577,100 in 2022 (an increase of $751,728 as compared with $825,372 in 2021), and to a lesser extent due
to an increase in general SG&A costs related to our incremental business activity in 2022.
|
•
|
Depreciation of long-lived assets increased $64,079 (265.0%) to $88,257 for the year
ended December 31, 2022 from $24,178 for the year ended December 31, 2021, mainly due to the increase in machinery and equipment predominantly located in Spain.
|
|
| |
As of
|
| |
Change
|
||||||
|
| |
September 30,
2023
|
| |
December 31,
2022
|
| |
$
|
| |
%
|
|
| |
(unaudited)
|
| |
|
| |
|
| |
|
Assets
|
| |
|
| |
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$11,534,785
|
| |
$5,044,949
|
| |
$6,489,836
|
| |
128.6%
|
Accounts receivable, net of allowance for doubtful
accounts of $100,868 and $47,758, respectively
|
| |
2,392,859
|
| |
2,099,177
|
| |
293,682
|
| |
14.0%
|
Inventory
|
| |
2,951,413
|
| |
6,175,000
|
| |
(3,223,587)
|
| |
(52.2)%
|
Prepaid expenses and other current assets
|
| |
2,029,972
|
| |
1,281,268
|
| |
748,704
|
| |
58.4%
|
Grants receivable
|
| |
1,259,393
|
| |
742,837
|
| |
516,556
|
| |
69.5%
|
Contract assets
|
| |
266,034
|
| |
2,197,730
|
| |
(1,931,696)
|
| |
(87.9)%
|
Total current assets
|
| |
20,434,456
|
| |
17,540,961
|
| |
2,893,495
|
| |
16.5%
|
Property, plant, and equipment, net
|
| |
12,071,988
|
| |
5,148,017
|
| |
6,923,971
|
| |
134.5%
|
Operating lease – Right of use asset, net
|
| |
1,978,266
|
| |
2,235,854
|
| |
(257,588)
|
| |
(11.5)%
|
Intangible assets, net
|
| |
154,019
|
| |
87,301
|
| |
66,718
|
| |
76.4%
|
Equity method investments
|
| |
142,530
|
| |
—
|
| |
142,530
|
| |
n.m.
|
Other assets
|
| |
1,764,838
|
| |
173,055
|
| |
1,591,783
|
| |
n.m.
|
Total assets
|
| |
$36,546,097
|
| |
$25,185,188
|
| |
$11,360,909
|
| |
45.1%
|
Liabilities and Stockholders´ Equity
|
| |
|
| |
|
| |
|
| |
|
Current liabilities:
|
| |
|
| |
|
| |
|
| |
|
Accounts payable
|
| |
$14,153,960
|
| |
$8,484,808
|
| |
$5,669,152
|
| |
66.8%
|
Current notes payable
|
| |
1,500,000
|
| |
—
|
| |
1,500,000
|
| |
n.m.
|
Current maturities of long-term debt
|
| |
21,458
|
| |
10,663
|
| |
10,795
|
| |
101.2%
|
Current maturities of operating lease liabilities
|
| |
166,926
|
| |
230,645
|
| |
(63,719)
|
| |
(27.6)%
|
Contract liabilities
|
| |
3,220,563
|
| |
1,735,716
|
| |
1,484,847
|
| |
85.5%
|
Current provisions
|
| |
85,864
|
| |
44,378
|
| |
41,486
|
| |
93.5%
|
Other current liabilities
|
| |
35,596
|
| |
21,179
|
| |
14,417
|
| |
68.1%
|
Total current liabilities
|
| |
19,184,367
|
| |
10,527,389
|
| |
8,656,978
|
| |
82.2%
|
Unearned grants
|
| |
3,531,326
|
| |
2,053,159
|
| |
1,478,167
|
| |
72.0%
|
Long-term operating lease liabilities
|
| |
1,900,146
|
| |
2,111,530
|
| |
(211,384)
|
| |
(10.0)%
|
Income taxes payable
|
| |
1,859,225
|
| |
1,787,968
|
| |
71,257
|
| |
4.0%
|
Long-term debt, less current maturities
|
| |
16,559,531
|
| |
13,796
|
| |
16,545,735
|
| |
n.m.
|
Other liabilities
|
| |
8,740,231
|
| |
208,912
|
| |
8,261,319
|
| |
n.m.
|
Total liabilities
|
| |
51,504,826
|
| |
16,702,754
|
| |
34,802,072
|
| |
208.4%
|
Stockholders’ (deficit) equity:
|
| |
|
| |
|
| |
|
| |
|
Common stock, $0.00001 par value per share; 10,346,314
shares authorized, 9,515,008 and 9,708,341 issued and outstanding at September 30, 2023 and December 31, 2022, respectively
|
| |
103
|
| |
103
|
| |
—
|
| |
—
|
Treasury stock, at cost, 831,306 shares at September
30, 2023 and 637,973 shares at December 31, 2022
|
| |
(9)
|
| |
(7)
|
| |
(2)
|
| |
28.6%
|
Additional paid-in capital
|
| |
1,341,102
|
| |
16,851,455
|
| |
(15,510,353)
|
| |
(92.0)%
|
Accumulated other comprehensive loss
|
| |
(3,842)
|
| |
(3,842)
|
| |
—
|
| |
0.0%
|
Accumulated deficit
|
| |
(16,296,083)
|
| |
(8,365,275)
|
| |
(7,930,808)
|
| |
94.8%
|
Total stockholders’ (deficit) equity
|
| |
(14,958,729)
|
| |
8,482,434
|
| |
(23,441,163)
|
| |
(276.3)%
|
Total liabilities and (deficit) equity
|
| |
$36,546,097
|
| |
$25,185,188
|
| |
$11,360,909
|
| |
45.1%
|
|
| |
As of December 31,
|
| |
Change
|
||||||
|
| |
2022
|
| |
2021
|
| |
$
|
| |
%
|
Assets
|
| |
|
| |
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$5,044,949
|
| |
$11,545,081
|
| |
$(6,500,132)
|
| |
(56.3)%
|
Accounts receivable, net of allowance for doubtful
accounts of $47,758 and $0, respectively
|
| |
2,099,177
|
| |
382,698
|
| |
1,716,479
|
| |
n.m.
|
Inventory
|
| |
6,175,000
|
| |
986
|
| |
6,174,014
|
| |
n.m.
|
Prepaid expenses and other current assets
|
| |
1,281,268
|
| |
2,100,391
|
| |
(819,123)
|
| |
(39.0)%
|
Grants receivable
|
| |
742,837
|
| |
498,308
|
| |
244,529
|
| |
49.1%
|
Contract assets
|
| |
2,197,730
|
| |
212,410
|
| |
1,985,320
|
| |
n.m.
|
Total current assets
|
| |
17,540,961
|
| |
14,739,874
|
| |
2,801,087
|
| |
19.0%
|
Property, plant, and equipment, net
|
| |
5,148,017
|
| |
858,149
|
| |
4,289,868
|
| |
n.m.
|
Operating lease – Right of use asset, net
|
| |
2,235,854
|
| |
1,553,135
|
| |
682,719
|
| |
44.0%
|
Intangible assets, net
|
| |
87,301
|
| |
85,503
|
| |
1,798
|
| |
2.1%
|
Other assets
|
| |
173,055
|
| |
210,105
|
| |
(37,050)
|
| |
(17.6)%
|
Total assets
|
| |
$25,185,188
|
| |
$17,446,766
|
| |
$7,738,422
|
| |
44.4%
|
Liabilities and Equity
|
| |
|
| |
|
| |
|
| |
|
Current liabilities:
|
| |
|
| |
|
| |
|
| |
|
Accounts payable and accrued expenses
|
| |
$8,484,808
|
| |
$593,146
|
| |
$7,891,662
|
| |
n.m.
|
Current maturities of long-term debt
|
| |
10,663
|
| |
1,946
|
| |
8,717
|
| |
n.m.
|
Current maturities of operating lease liabilities
|
| |
230,645
|
| |
106,773
|
| |
123,872
|
| |
n.m.
|
Contract liabilities
|
| |
1,735,716
|
| |
257,061
|
| |
1,478,655
|
| |
n.m.
|
Current provisions
|
| |
44,378
|
| |
17,348
|
| |
27,030
|
| |
n.m.
|
Other current liabilities
|
| |
21,179
|
| |
3,792
|
| |
17,387
|
| |
n.m.
|
Total current liabilities
|
| |
10,527,389
|
| |
980,066
|
| |
9,547,323
|
| |
n.m.
|
Unearned grants
|
| |
2,053,159
|
| |
271,091
|
| |
1,782,068
|
| |
n.m.
|
Long-term operating lease liabilities
|
| |
2,111,530
|
| |
1,489,869
|
| |
621,661
|
| |
41.7%
|
Income taxes payable
|
| |
1,787,968
|
| |
1,729,227
|
| |
58,741
|
| |
3.4%
|
Long-term debt, less current maturities
|
| |
13,796
|
| |
17,743
|
| |
(3,947)
|
| |
(22.2)%
|
Other liabilities
|
| |
208,912
|
| |
119,608
|
| |
89,304
|
| |
74.7%
|
Total liabilities
|
| |
16,702,754
|
| |
4,607,604
|
| |
12,095,150
|
| |
n.m.
|
H2B2 Electrolysis Technologies, Inc.
Stockholders’ equity:
|
| |
|
| |
|
| |
|
| |
|
Common stock, $ 0.00001 par value per share; 10,346,314
shares authorized, 9,708,341 and 9,736,314 issued and outstanding at December 31, 2022 and 2021, respectively
|
| |
103
|
| |
103
|
| |
—
|
| |
n.m.
|
Treasury stock, at cost, 637,973 and 610,000 shares at
December 31, 2022 and 2021, respectively
|
| |
(7)
|
| |
(6)
|
| |
(1)
|
| |
16.7%
|
Additional paid-in capital
|
| |
16,851,455
|
| |
16,835,962
|
| |
154,493
|
| |
0.1%
|
Accumulated other comprehensive loss
|
| |
(3,842)
|
| |
(3,842)
|
| |
—
|
| |
n.m.
|
Accumulated deficit
|
| |
(8,365,275)
|
| |
(4,068,816)
|
| |
(4,296,459)
|
| |
n.m.
|
Total H2B2 Electrolysis Technologies,
Inc. Stockholders’ equity
|
| |
8,482,434
|
| |
12,763,401
|
| |
(4,280,967)
|
| |
(33.5)%
|
Non-controlling interests
|
| |
—
|
| |
75,761
|
| |
(75,761)
|
| |
n.m.
|
Total equity
|
| |
8,482,434
|
| |
12,839,162
|
| |
(4,356,728)
|
| |
(33.9)%
|
Total liabilities and equity
|
| |
$25,185,188
|
| |
$17,446,766
|
| |
$7,738,422
|
| |
44.4%
|
•
|
The Company’s stock is publicly traded prior to January 1, 2026.
|
•
|
The executive maintains employment with the Company until March 31, 2026.
|
|
| |
Nine-month period
ended September 30,
|
| |
Change
|
||||||
|
| |
2023
|
| |
2022
|
| |
$
|
| |
%
|
|
| |
(unaudited)
|
| |
|
| |
|
|||
Net cash provided by/(used) in:
|
| |
|
| |
|
| |
|
| |
|
Operating activities
|
| |
$1,428,427
|
| |
$(3,032,551)
|
| |
$4,460,978
|
| |
(147.1)%
|
Investing activities
|
| |
(5,651,351)
|
| |
(408,931)
|
| |
(5,242,420)
|
| |
n.m.
|
Financing activities
|
| |
10,583,576
|
| |
(28,138)
|
| |
10,611,714
|
| |
n.m.
|
Effect of exchange rate changes on cash and cash
equivalents
|
| |
129,184
|
| |
(1,224,121)
|
| |
1,353,305
|
| |
(110.6)%
|
Increase (decrease) in cash and cash equivalents
|
| |
6,489,836
|
| |
(4,693,741)
|
| |
11,183,576
|
| |
(238.3)%
|
Cash and cash equivalents beginning of period
|
| |
5,044,949
|
| |
11,545,081
|
| |
(6,500,132)
|
| |
(56.3)%
|
Cash and cash equivalents end of period
|
| |
$11,534,785
|
| |
$6,851,340
|
| |
$4,683,445
|
| |
68.4%
|
|
| |
Year ended December 31,
|
| |
Change
|
||||||
|
| |
2022
|
| |
2021
|
| |
$
|
| |
%
|
Net cash (used in)/provided by:
|
| |
|
| |
|
| |
|
| |
|
Operating activities
|
| |
$(4,712,637)
|
| |
$(5,411,020)
|
| |
$698,383
|
| |
(12.9)%
|
Investing activities
|
| |
(1,240,429)
|
| |
(1,736,570)
|
| |
496,141
|
| |
(28.6)%
|
Financing activities
|
| |
(20,230)
|
| |
9,014,233
|
| |
(9,034,463)
|
| |
n.m.
|
Effect of exchange rate changes on cash and cash
equivalents
|
| |
(526,836)
|
| |
(650,253)
|
| |
123,417
|
| |
(19.0)%
|
(Decrease) increase in cash and cash equivalents
|
| |
(6,500,132)
|
| |
1,216,390
|
| |
(7,716,522)
|
| |
n.m.
|
Cash and cash equivalents beginning of period
|
| |
11,545,081
|
| |
10,328,691
|
| |
1,216,390
|
| |
11.8%
|
Cash and cash equivalents end of period
|
| |
$5,044,949
|
| |
$11,545,081
|
| |
$(6,500,132)
|
| |
(56.3)%
|
|
| |
As of December 31,
|
|
| |
2022
|
2023
|
| |
$290,645
|
2024
|
| |
344,984
|
2025
|
| |
346,020
|
2026
|
| |
347,087
|
2027
|
| |
331,314
|
Thereafter
|
| |
2,287,624
|
Total future minimum lease payments
|
| |
3,947,674
|
Less imputed lease interest
|
| |
(1,605,499)
|
Total lease liabilities
|
| |
$2,342,175
|
•
|
they do not reflect the Company’s CapEx, the Company’s future requirements for CapEx or the Company’s contractual commitments;
|
•
|
they do not reflect changes in, or cash requirements for, the Company’s working capital needs;
|
•
|
although depreciation is a non-cash charge, the assets being depreciated will often need to be replaced in the future and
measures based on EBITDA do not reflect any cash requirements that would be required for such replacements; and
|
•
|
the fact that other companies in the industry may calculate EBITDA differently than we do limit their usefulness as comparative
measures.
|
|
| |
Three-month period
ended September 30,
|
| |
Nine-month period ended
September 30,
|
| |
Year ended
December 31,
|
|||||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
| |
2022
|
| |
2021
|
|
| |
(unaudited)
|
| |
(unaudited)
|
| |
|
| |
|
||||||
Net loss
|
| |
$(2,901,510)
|
| |
$(1,486,922)
|
| |
$(7,930,808)
|
| |
$(3,419,735)
|
| |
$(4,296,459)
|
| |
$(4,131,004)
|
Income tax expense
|
| |
22,764
|
| |
16,403
|
| |
69,884
|
| |
39,643
|
| |
76,128
|
| |
34,391
|
Interest and financial income (expense), net
|
| |
159,424
|
| |
495,677
|
| |
341,332
|
| |
1,252,200
|
| |
557,112
|
| |
757,444
|
Depreciation and amortization of long-lived assets
|
| |
51,700
|
| |
38,576
|
| |
134,151
|
| |
49,332
|
| |
88,257
|
| |
24,178
|
EBITDA (unaudited)
|
| |
$(2,667,622)
|
| |
$(936,266)
|
| |
$(7,385,441)
|
| |
$(2,078,560)
|
| |
$(3,574,963)
|
| |
$(3,314,991)
|
|
| |||||||||||||||||
Product sales
|
| |
765,272
|
| |
408,999
|
| |
7,932,684
|
| |
1,646,000
|
| |
3,491,673
|
| |
961,607
|
Net loss margin
|
| |
(379.1)%
|
| |
(363.6)%
|
| |
(100.0)%
|
| |
(207.8)%
|
| |
(123.0)%
|
| |
(429.6)%
|
EBITDA Margin
(unaudited)
|
| |
(348.6)%
|
| |
(228.9)%
|
| |
(93.1)%
|
| |
(126.3)%
|
| |
(102.4)%
|
| |
(344.7)%
|
Name
|
| |
Age
|
| |
Title
|
Antonio Vázquez Romero
|
| |
71
|
| |
Chairman of the Board, Director
|
Anselmo Andrade Fernández de Mesa
|
| |
30
|
| |
Chief Executive Officer, Director
|
Blanca Benjumea de Porres
|
| |
33
|
| |
Chief Financial Officer
|
Florencio Ferrera Saldaña
|
| |
53
|
| |
Chief Operating Officer
|
Javier Brey Sánchez
|
| |
49
|
| |
Chief Technology Officer
|
Felipe Benjumea de Porres
|
| |
29
|
| |
Chief Investment Officer, Director
|
África Castro Rosende
|
| |
51
|
| |
Business Development Officer
|
Blanca de Porres Guardiola
|
| |
59
|
| |
Director
|
Guillermo Delclaux Lezama Leguizamón
|
| |
40
|
| |
Director
|
Manuel Delclaux Lezama Leguizamón
|
| |
34
|
| |
Director
|
Robert S. Mancini
|
| |
66
|
| |
Director
|
Iván E. Mercado
|
| |
56
|
| |
Director
|
•
|
the Surviving Corporation will have independent director representation on its audit, compensation and nominating committees
immediately at the time of the Business Combination, and its independent directors will meet regularly in executive sessions without the presence of its corporate officers or non-independent directors;
|
•
|
at least one of the Surviving Corporation’s directors will qualify as an “audit committee financial expert” as defined by the
SEC; and
|
•
|
the Surviving Corporation will implement a range of other corporate governance best practices, including implementing a robust
director education program.
|
•
|
appointing, compensating, retaining, evaluating, terminating and overseeing its independent registered public accounting firm;
|
•
|
discussing with its independent registered public accounting firm their independence from management;
|
•
|
reviewing, with its independent registered public accounting firm, the scope and results of their audit;
|
•
|
approving all audit and permissible non-audit services to be performed by its independent registered public accounting firm;
|
•
|
overseeing the financial reporting process and discussing with management and its independent registered public accounting firm
the quarterly and annual financial statements that its files with the SEC;
|
•
|
overseeing its financial and accounting controls and compliance with legal and regulatory requirements;
|
•
|
reviewing its policies on risk assessment and risk management;
|
•
|
reviewing related person transactions; and
|
•
|
establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal
controls or auditing matters.
|
•
|
reviewing and approving the corporate goals and objectives, evaluating the performance of and reviewing and approving, (either
alone or, if directed by the Surviving Corporation Board, in conjunction with a majority of the independent members of the Surviving Corporation Board) the compensation of its Chief Executive Officer;
|
•
|
overseeing an evaluation of the performance of and reviewing and setting or making recommendations to the Surviving Corporation
Board regarding the compensation of its other executive officers;
|
•
|
reviewing and approving or making recommendations to the Surviving Corporation Board regarding the Surviving Corporation’s
incentive compensation and equity-based plans, policies and programs;
|
•
|
reviewing and approving all employment agreement and severance arrangements for the Surviving Corporation’s executive officers;
|
•
|
making recommendations to the Surviving Corporation Board regarding the compensation of the Surviving Corporation’s directors;
and
|
•
|
retaining and overseeing any compensation consultants.
|
•
|
identifying individuals qualified to become members of the Surviving Corporation Board, consistent with criteria approved by the
Surviving Corporation Board;
|
•
|
overseeing succession planning for the Surviving Corporation’s Chief Executive Officer and other executive officers;
|
•
|
periodically reviewing the Surviving Corporation Board’s leadership structure and recommending any proposed changes to the
Surviving Corporation Board;
|
•
|
overseeing an annual evaluation of the effectiveness of the Surviving Corporation Board and its committees; and
|
•
|
developing and recommending to the Surviving Corporation Board a set of corporate governance guidelines.
|
•
|
Anselmo Andrade Fernández de Mesa, Chief Executive Officer and Former Head of Business
Development;
|
•
|
Florencio Ferrera Saldaña, Chief Operating Officer and Former Chief Executive Officer;
|
•
|
Felipe Benjumea Llorente, Strategic Advisor; and
|
•
|
Javier Brey Sánchez, Chief Technology Officer.
|
Name and Principal
Position(1)
|
| |
Salary ($)
|
| |
Non-Equity
Incentive Plan
Compensation
($)(2)
|
| |
Total
|
Anselmo Andrade Fernández de Mesa
Chief Executive Officer and Former Head of
Business Development
|
| |
57,074
|
| |
—
|
| |
57,074
|
Florencio Ferrera Saldaña
Chief Operating Officer and Former Chief
Executive Officer
|
| |
213,960
|
| |
—
|
| |
213,960
|
Felipe Benjumea Llorente
Strategic Advisor
|
| |
352,117
|
| |
—
|
| |
352,117
|
Javier Brey Sánchez
Chief Technology Officer
|
| |
106,980
|
| |
—
|
| |
107,260
|
(1)
|
Base salary and other compensation values in this Summary Compensation Table originally denoted in local currency (EUR) have been
converted to USD using an exchange rate as of December 30, 2022 (the last business day of 2022) of 1 USD to 0.93475 EUR.
|
(2)
|
Non-equity incentive plan compensation consists of payments made pursuant to our annual incentive bonus program, discussed below
under “Narrative to Summary Compensation Table—2022 Bonuses.” For fiscal year 2022, the amounts of the annual cash incentives earned by our named executive officers have not yet been determined
as of the date of this filing and are expected to be determined and disclosed in a subsequent filing. Messrs. Benjumea Llorente and Sánchez did not participate in our 2022 annual incentive bonus program.
|
|
| |
Option Awards
|
|||||||||||||||
Name
|
| |
Grant
Date
|
| |
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
| |
Number
of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
|
| |
Equity
Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
|
| |
Option
Exercise
Price
($)
|
| |
Option
Expiration
Date
|
Anselmo Andrade Fernández de Mesa(1)
|
| |
1/1/2021
|
| |
—
|
| |
125,000
|
| |
—
|
| |
$1.00
|
| |
3/31/2026
|
Florencio Ferrera Saldaña(1)
|
| |
7/1/2021
|
| |
—
|
| |
200,000
|
| |
—
|
| |
$1.00
|
| |
3/31/2026
|
Felipe Benjumea Llorente
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Javier Brey Sánchez(1)
|
| |
1/1/2021
|
| |
—
|
| |
25,000
|
| |
—
|
| |
$1.00
|
| |
3/31/2026
|
(1)
|
These option awards vest on January 1st, 2026, subject to the applicable named executive officer’s continued service,
and will vest in full upon the applicable named executive officer’s termination of service due to death or disability. In the event of termination of the named executive officer’s service with the Company (other than due to death or
disability) before January 1, 2026, the named executive officer shall lose their rights to purchase the shares subject to the options.
|
Name(1)
|
| |
Fees Earned
or Paid in
Cash ($)
|
| |
Option
Awards
($)(2)
|
| |
Total ($)
|
Antonio Vázquez Romero
|
| |
4,167(3)
|
| |
113,063
|
| |
117,230
|
Ignacio Solis
|
| |
16,047
|
| |
—
|
| |
16,047
|
Gonzalo Hidalgo
|
| |
16,047
|
| |
—
|
| |
16,047
|
Guillermo Delclaux
|
| |
16,047
|
| |
—
|
| |
16,047
|
Manuel Delclaux
|
| |
16,047
|
| |
—
|
| |
16,047
|
Fernando Franco
|
| |
16,047
|
| |
—
|
| |
16,047
|
Juan Suarez
|
| |
16,047
|
| |
—
|
| |
16,047
|
(1)
|
Compensation values in this Director Compensation Table originally denoted in local currency (EUR) have been converted to USD
using an exchange rate as of December 30, 2022 (the last business day of 2022) of 1 USD to 0.93475 EUR.
|
(2)
|
Amount reflects the full grant-date fair value of awards of H2B2 Options granted during 2022 computed in accordance with ASC 718,
rather than the amounts paid to or realized by the named individual. See the consolidated financial statements and notes thereto included elsewhere in this proxy statement/prospectus for a discussion of the relevant assumptions used in
calculating this amount.
|
(3)
|
Mr. Vázquez commenced service on our board of directors in December 2022. Accordingly, the amounts shown reflect the 2022 cash
fees earned by or paid to Mr. Vázquez in respect of his partial year of service.
|
Name
|
| |
Shares Subject to
H2B2 Options at
Fiscal Year End
(#)
|
Antonio Vázquez Romero
|
| |
68,966(a)
|
Ignacio Solis
|
| |
—
|
Gonzalo Hidalgo
|
| |
—
|
Guillermo Delclaux
|
| |
—
|
Manuel Delclaux
|
| |
—
|
Fernando Franco
|
| |
—
|
Juan Suarez
|
| |
—
|
(a)
|
In December 2022, Mr. Vázquez was granted two H2B2 Options: (i) an H2B2 Option covering 68,966 shares of H2B2 Common Stock
(the “First Vázquez H2B2 Option”) and (ii) an H2B2 Option covering a number of shares of H2B2 Common Stock determined as described below (the “Second Vázquez H2B2 Option”). In April 2023, Mr. Vázquez exercised the First Vázquez H2B2 Option in full, subject to and conditioned upon the Closing. In December 2023, the
conditional exercise of such option was rescinded, and such option was amended to permit Mr. Vázquez to exercise such option during the period beginning on the date on which Mr. Vázquez became the non-executive chairman of the H2B2
Board and ending on the third anniversary of the effective date of such option amendment. The number of shares of H2B2 Common Stock subject to the Second Vázquez H2B2 Option will be determined by dividing $750,000 by the exchange
price of the Company’s shares in the Business Combination.
|
•
|
Purchase equity price. RMG III derived a purchase equity price of $500,000,000. The
purchase equity price would be revisited after a minimum of $15,000,000 of new capital raised by H2B2 through a private capital raise, with the aim of an upward adjustment by a 5% to 10% premium to the amount of the post-money
calculation of the private capital raise. Such private capital raise was expected to raise up to $200,000,000 in equity commitments;
|
•
|
Earnout Shares. Consistent with the terms of the November LOI and the December LOI, an
additional 10,000,000 earnout shares would be issued to H2B2’s existing stockholders if the share price of the combined company met certain price targets;
|
•
|
Vesting of founder shares. RMG III Class B Ordinary Shares would vest in the combined
company pursuant to a vesting schedule based on the share price of the combined company meeting certain price targets;
|
•
|
Private capital raise. The consummation of the potential business combination would be
conditioned upon the completion by H2B2 of the private capital raise;
|
•
|
Sponsor lock-up agreement. A lock-up agreement would be entered into by the Sponsor
replicating the lock-up in effect relating to the RMG III Class B Ordinary Shares as of the date of the Initial Public Offering;
|
•
|
H2B2 stockholders lock-up agreement. Lock-up Agreements would be entered into
by certain H2B2 Stockholders, subject to customary exceptions and registration rights, whereby shares held by certain H2B2 Stockholders at the closing of the proposed business combination would be released from lock-up 180 days after
the closing of the proposed business combination;
|
•
|
Management. Senior management of H2B2 would continue to serve in their existing
positions in the combined entity, and the CEO of the combined entity would be Mr. Anselmo Andrade Fernández de Mesa;
|
•
|
Board composition. Non-independent directors of the combined company would be appointed
by H2B2, all but one independent director would be initially proposed by H2B2, and one independent director would be initially proposed by RMG III; and
|
•
|
Exclusivity. Each of RMG III and H2B2 agreed to an exclusivity term of 90 days
following the execution of the January LOI, at the end of which the January LOI would be automatically extended for 30-day terms unless advance notice to terminate was given by either party prior to the expiration of the relevant 30-day
term. During the exclusivity period, H2B2 agreed not to initiate, solicit, seek, negotiate or accept any proposal or offer or enter into or consummate any merger, consolidation, liquidation, dissolution, recapitalization,
reorganization, amalgamation, business combination or similar transactions (including a de-SPAC transaction) other than with RMG III, and RMG III agreed not to initiate, solicit, seek, negotiate or accept any proposal or offer or enter
into or consummate any de-SPAC transaction with a target other than H2B2 or its affiliates.
|
•
|
Adjustment of RMG III Warrants’ exchange ratio. In order to further incentivize H2B2
Stockholders to approve the Business Combination, RMG III and H2B2 agreed that the RMG III Warrants’ exchange ratio would be adjusted such that, following the Business Combination, each RMG III Warrant would be exercisable for 0.075
shares of Surviving Corporation Common Stock;
|
•
|
H2B2 termination right. RMG III and H2B2 agreed that H2B2 would have a right to
terminate the Merger Agreement in the event that certain Capital Raise Investors participating in the Capital Raise Transaction object to the Merger, in exchange for the payment of a reimbursement fee amounting to $3,300,000 by H2B2 to
RMG III to cover costs and expenses incurred by RMG III relating to efforts and resources expended and opportunities foregone while negotiating the Merger Agreement;
|
•
|
Closing date purchase price. After discussions between RMG III and H2B2, the
parties agreed to a base purchase price of $750,000,000 to be adjusted upwards or downwards on a dollar-for-dollar basis:
|
i.
|
If H2B2 raises capital in an equity or equity-linked Capital Raise Transaction, an amount equal to the difference between the
base purchase price and the actual pre-money valuation in the Capital Raise Transaction, plus the amount raised in the Capital Raise Transaction, plus $2,000,014 which amount accounts for exercise of H2B2 stock options by the H2B2
chairperson, Mr. Antonio Vázquez Romero at the Closing; and
|
ii.
|
If H2B2 raises capital in a debt raise transaction (other than in a transaction solely involving traditional senior debt) an
amount equal to the difference between the base purchase price and the actual debt transaction pre-money valuation, plus the $2,000,014;
|
•
|
No earnout shares. No earnout shares would be issued to H2B2 Stockholders;
|
•
|
No founder shares’ vesting schedule. After discussions between RMG III and
H2B2, RMG III agreed to accept H2B2’s proposal on the vesting of the Founder Shares. At Closing, only a number of shares of RMG III Common Stock owned by the Sponsor equal to the Founder Consideration Shares would convert into
Surviving Corporation Common Stock with the remainder of such shares of RMG III Common Stock owned by the Sponsor being cancelled with no vesting schedule; and
|
•
|
Observer on the Surviving Corporation’s board of directors: After discussions between
RMG III and H2B2, the parties agreed that RMG III will have the right, for a one-year period following the Closing, to appoint an observer to the Surviving Corporation’s board of directors in lieu of one independent director.
|
•
|
Base Purchase Price. The definition of Base Purchase Price was removed.
|
•
|
Closing Date Purchase Price. The definition of Closing Date Purchase Price
was amended to a fixed purchase price of $400,000,000.
|
•
|
No AVR Option Amount. The removal of the AVR Option Amount from the
calculation of the “Closing Date Purchase Price” and “Minimum Investment Amount” as a result of the agreement
between Mr. Vázquez and H2B2 to rescind the exercise of Mr. Vázquez’s option to acquire up to 68,966 shares of H2B2 and amend such option permit Mr. Vázquez to exercise such option until the third anniversary of the effective date of
such option amendment;
|
•
|
Revised Minimum Investment Amount. To better account for current
market conditions impacting the Capital Raise Transaction, the parties agreed to reduce the Minimum Investment Amount from $40,000,000 to $30,000,000.
|
•
|
No 10% Premium. As a result of reducing the Minimum Investment Amount and
commercial discussions relating to H2B2’s valuation, the parties agreed to remove the ten percent (10%) premium from the calculation of the Closing Date Purchase Price.
|
•
|
No Minimum Net Tangible Assets Condition. On August 4, 2023, the shareholders
of RMG III approved the proposal to amend and restate the RMG III Governing Documents to eliminate the limitation that RMG III shall not redeem Public Shares to the extent that such redemptions would cause RMG III’s net tangible
assets to be less than $5,000,001 following such redemptions. As a result of such amendment, and to increase certainty of closing, RMG III and H2B2 agreed to remove the minimum net tangible assets condition precedent.
|
•
|
Conversion of RMG III Class B Ordinary Shares. RMG III and H2B2 agreed
certain amendments to the definition of “Founder Consideration Shares” and other related sections of the Merger Agreement to account for the planned partial conversion by Sponsor
of certain RMG III Class B Ordinary Shares into RMG III Class A Ordinary Shares prior to closing of the Merger.
|
•
|
Warrant Amendment. The covenant relating to the Warrant Amendment was amended
to clarify that it shall, following the execution thereof, cause, in connection with the closing of the Merger, each of the then outstanding Public Warrants and Private Placement Warrants to be canceled and exchanged for the right to
receive up to 0.075 shares of Surviving Corporation Common Stock.
|
•
|
Director Nominees. The covenant relating to the Surviving Corporation Board
was amended to provide that, immediately following the Effective Time, the Surviving Corporation Board will consist of nine (9) directors, which will initially include (i) six (6) director nominees, each of whom will be independent
directors for the purposes of Nasdaq, to be mutually designated by H2B2 as set forth in the Merger Agreement, and all of whom will be proposed by H2B2 pursuant to written notice to RMG III as soon as reasonably practicable following
the date of the Merger Agreement and (ii) three (3) director nominees to be designated by H2B2.
|
•
|
Early mover advantage in high-growth hydrogen markets supported by global
regulatory tailwinds. The green hydrogen market has the potential to reach ~$10 trillion by 2030, and it is supported by regulators globally as evidenced by the IRA, the Green Industrial Plan in the EU, and hydrogen roadmaps
discussed by a number of other countries. RMG III’s Board believed that H2B2 has a first mover advantage that positions them as an experienced competitor in a nascent industry in need of expertise across the value chain, from project
development to operations and maintenance. RMG III’s Board also believed that the Company’s favorable positioning is expected to allow H2B2 to grow rapidly with the market.
|
•
|
Vertically integrated business model. RMG III’s Board believed that
H2B2 approaches the green hydrogen market by leveraging its expertise across the value chain, including technological development, project development, electrolyzer manufacturing, EPC services, and operations and
|
•
|
Demonstrated success in generating customer demand. RMG III’s Board
believed that H2B2 has evidenced its competitive market positioning with 82 MWs of projects under construction and recently awarded, as well as key customer partnerships, such as with Ecopetrol. The Company’s impressive pipeline
indicates management’s ability to provide tailored solutions to address key customer selection criteria. RMG III’s Board believed that H2B2’s early mover advantage in a growing market, paired with its vertically integrated solutions, is
expected to lead to further project awards.
|
•
|
Highly Experienced Management Team Ready to Commercialize Market
Opportunity. The RMG III Board believed that H2B2 has an experienced leadership team with a track record of successfully developing and deploying cutting edge technologies from product inception to successful market launch.
|
•
|
Results of Due Diligence Conducted by RMG III. The RMG III Board
considered the scope of the due diligence examinations conducted by RMG III’s management team and outside advisors and evaluated the results thereof and information available to it related to H2B2, including:
|
○
|
extensive virtual meetings and calls with H2B2’s management team regarding its operations and
projections and the proposed Business Combination;
|
○
|
in-person meetings at H2B2’s locations; and
|
○
|
review of materials related to H2B2 made available, including with respect to financial,
accounting, tax, legal (including corporate governance, indebtedness, real property, intellectual property, executive compensation and labor, anti-trust/regulatory and litigation), industry, management background and technical due
diligence matters.
|
•
|
Terms of the Transaction Documents. The RMG III Board reviewed and
considered the terms of the Merger Agreement and the other related agreements, including the parties’ conditions to their respective obligations to complete the transactions contemplated therein and their ability to terminate the Merger
Agreement. See the sections entitled “The Merger Agreement” and “Other Agreements” for detailed discussions of the terms and conditions of these
agreements.
|
•
|
Redemption Rights Available for Public Shareholders. If the Business
Combination closes, the Public Shareholders may have all or any portion of their Public Shares redeemed for cash, regardless of whether they vote for or against the Business Combination Proposal. This redemption option will allow each
Public Shareholder to choose whether or not to invest in H2B2. This is an important decision, particularly given certain post-signing developments as noted in the negative factors, uncertainties and risks described below. If the
Business Combination fails to close, this redemption option will not be available until RMG III finds and closes an alternative transaction in the future, which could take substantial time and may never occur. Given the state of the
market, there are a more limited number of targets available for SPACs, and it will be more difficult for RMG III to identify and close an alternative transaction.
|
•
|
Consideration. The RMG III Board has substantial experience in
evaluating the operating and financial merits of companies from a wide range of industries and their experience and backgrounds, together with the experience and expertise of RMG III’s advisors, enabled them to make the necessary
analyses and determination that consideration being paid in the Business Combination, which amount was negotiated at arms-length, was in the best interests of RMG III and RMG III shareholders and appropriately reflected H2B2’s value.
|
•
|
No Better Alternatives. The RMG III Board believed, after a thorough
review of other business combination opportunities reasonably available to RMG III, that the proposed Business Combination represented the best potential business combination for RMG III that was currently available in the market at the
time the Business Combination announced.
|
•
|
Growth opportunities through capital investment. The RMG III Board
believed that H2B2 had prospects of benefiting from additional capital investment, particularly through the Capital Raise Transaction.
|
•
|
Limited Management Experience in Operating a Public Company. H2B2’s
management has limited experience in operating a U.S. public company. The requirements of being a public company may strain H2B2’s resources and divert management’s attention, and the increases in legal, accounting and compliance
expenses that will result from the Merger may be greater than H2B2 anticipates.
|
•
|
Uncertainty Regarding Post-Closing Trading Price and Float. The RMG
III Board believed that there is a meaningful risk that shares of Surviving Corporation Common Stock may trade below $10.00 per share immediately post-Closing, and that a substantial percentage of holders of Public Shares may choose to
redeem their shares rather than remain invested in H2B2.
|
•
|
Valuation Depends on Future Performance. The valuation of H2B2
agreed to in the Business Combination depended in large part on H2B2’s performance in calendar years 2023 and 2024. There is a risk that, if H2B2 does not perform as was expected, the valuation used in the Business Combination may not
reflect the fair market value of H2B2 at the time of Closing.
|
•
|
Limitations of Due Diligence. Although RMG III and its outside
advisors conducted due diligence on H2B2, the scope of review was limited by the time available, the materials provided by H2B2 and the inherent uncertainties in any due diligence process. Accordingly, there can be no assurance that RMG
III discovered all material issues that may be present with regard to H2B2’s business, or that issues outside of RMG III’s or H2B2’s control will not later arise.
|
•
|
Benefits not Achieved. The RMG III Board considered the risk that
the potential benefits of the Business Combination may not be fully achieved or may not be achieved within the expected timeframe.
|
•
|
No Third-Party Valuation. The RMG III Board considered the risk that
it did not obtain an opinion from an independent investment banking firm or other independent entity that commonly renders valuation opinions in connection with the Business Combination. As disclosed in RMG III’s IPO Registration
Statement, the RMG III Board is required to obtain an opinion, from an independent investment banking firm or other independent entity that commonly renders valuation opinions, that the Business Combination is fair to RMG III from a
financial point of view only if the Business Combination is with a target that is affiliated with the Sponsor or RMG III’s officers or directors. Because H2B2 is not an affiliate of the Sponsor or RMG III’s officers or directors, RMG
III is not required to obtain such an opinion for the proposed Business Combination.
|
•
|
Liquidation of RMG III. The RMG III Board considered the risks and
costs to RMG III if the Business Combination is not completed, including the risk of diverting management focus and resources from other businesses combination opportunities, which could result in RMG III being unable to effect a
business combination by the Completion Window and being forced to liquidate.
|
•
|
Exclusivity. The RMG III Board considered the fact that the Merger
Agreement includes an exclusivity provision that prohibits RMG III from soliciting other business combination proposals and restricts RMG III’s ability to consider other potential business combinations so long as the Merger Agreement is
in effect.
|
•
|
Post-Business Combination Corporate Governance. The RMG III Board
considered the corporate governance provisions of the Merger Agreement and the proposed material provisions of the Proposed Organizational Documents and the effect of those provisions on the governance of the company post-Business
Combination. Given that the existing stockholders of H2B2 will collectively control shares representing a majority of the outstanding shares of Surviving Corporation Common Stock upon completion of the Business Combination, the existing
stockholders of H2B2 may be able to elect future directors and make other decisions (including approving certain transactions involving the Surviving Corporation and other corporate actions) without the consent or approval of any of RMG
III’s current shareholders, directors or management team. See the sections entitled “The Merger Agreement,” “Management of the Surviving Corporation Following
the Business Combination” for detailed discussions.
|
•
|
Closing Conditions. The RMG III Board considered the fact that
completion of the Business Combination is conditioned on the satisfaction or waiver of certain closing conditions that are not within RMG III’s control.
|
•
|
Litigation. The RMG III Board considered the possibility of
litigation challenging the Business Combination or that an adverse judgment granting permanent injunctive relief could indefinitely delay consummation of the Business Combination.
|
•
|
Potential Conflicts. The RMG III Board considered the potential
additional or different conflicts of interests of RMG III’s directors, executive officers, the Sponsor and its affiliates, as described in the sections entitled “—Interests of RMG III’s Directors,
Executive Officers and the Sponsor and its Affiliates in the Business Combination” and “Certain Relationships and Related Party Transactions.” The RMG III Board, including RMG III’s
independent directors, with their outside counsel, reviewed and considered these interests during the negotiation of the Business Combination and in evaluating and approving, as members of the RMG III Board, the Merger Agreement and the
transactions contemplated thereby, including the Merger.
|
•
|
Fees and Expenses. The RMG III Board considered the fees and
expenses associated with completing the Business Combination.
|
•
|
Other Risks. The RMG III Board considered various other risks
associated with the Business Combination, the business of RMG III and the business of H2B2 described under the section entitled “Risk Factors.”
|
•
|
Revenue growth forecasted in 2023 is mainly expected to come from projects under construction or awarded projects and revenue
growth forecasted in 2024 is also based on projects under construction or awarded projects as well as projects currently in the pipeline of identified opportunities, with H2B2’s Conventional Products expected to be the main near-term
revenue growth drivers, complemented by H2B2’s Integrated Products;
|
•
|
Bookings and market size (GW) growth based on H2B2’s bottom-up pipeline, including contracted projects and contracts under
discussion. H2B2’s pipeline is compromised solely of projects that H2B2 has identified and had at least preliminary discussions with the relevant counterparty about the scope of the project and expected services, bookings and timing,
among other things;
|
•
|
The growth of EPC and O&M services as projects under construction or awarded projects are begun or completed;
|
•
|
Increased investment in research and development to increase the efficiency of electrolyzers and increase breadth of the H2B2
product portfolio, including developing next-generation SOEC and AEM technologies;
|
•
|
Expanded spare parts inventory to meet PG requirements;
|
•
|
The SoHyCal project will be deconsolidated from H2B2 for accounting purposes in 2024;
|
•
|
Expanded minority investments in projects developed by H2B2;
|
•
|
Increased investment in personnel, with a focus on business development, engineering and project development;
|
•
|
Receipt of government funds through additional grants, subsidies and awards; and
|
•
|
Improved economies of scale in general and administrative functions.
|
•
|
As of April 2023, H2B2’s pipeline of identified opportunities consisted of more than 200 potential projects, with approximately
13 of the projects being projects under construction or awarded projects;
|
•
|
For the year ended December 31, 2022, 100% of H2B2’s revenue was from H2B2’s Conventional Products and 0% of H2B2’s revenue was
from H2B2’s Integrated Products;
|
•
|
92% of the revenue forecasted in 2023 is based on projects that are under construction or awarded projects;
|
•
|
Estimated new project revenue for fiscal years 2023 and 2024 is expected to be split 100% and 55.5% from H2B2’s Conventional
Products and 0% and 44.5% from H2B2’s Integrated Products, respectively;
|
•
|
EPC revenue is forecasted on the expected CapEx cost of the renewable source, EPC costs of the hydrogen plant, plus a margin;
|
•
|
EPC revenue is expected to grow as Integrated Product projects are completed and H2B2 wins projects for solely EPC services;
|
•
|
O&M services revenue is expected to grow as new Conventional Product and Integrated Product projects are under construction
or installed, which H2B2 expects 75% of Conventional Products and 100% of Integrated Products projects will enter into O&M services contracts;
|
•
|
The average price per electrolyzer is expected to drop 5% annually over time until a unit prove of $750k per MW electrolyzer is
achieved, driven by economies of scale and technology improvements;
|
•
|
The establishment of regional manufacturing facilities in target markets throughout EMEA, the Americas and APAC;
|
•
|
An estimated green hydrogen demand outlook of 9.1 (MT) in 2030, annual electrolyzer installations of 85 GW in 2030, including an
expected boost in electrolyzer capacity from 2 GW worldwide to 242 GW in 2030, which would represent an 82% CAGR, and annual investment in electrolyzer deployment of $36 billion in 2030; and
|
•
|
Management forecasts for hydrogen industry growth.
|
•
|
The ability to convert potential pipeline projects into projects under construction or awarded projects was based on H2B2’s
historical project conversion rate, the current stage of the process of each identified pipeline project and the expected growth in green hydrogen demand and annual electrolyzer installations;
|
•
|
The revenue split between H2B2’s Conventional Products and Integrated Products was based on H2B2’s estimated pipeline projects
that are under construction or awarded for 2023 and 2024; and
|
•
|
The growth in EPC services was based on management’s estimates at the time, trended in pipeline projects, third party market
growth data and H2B2 diligence.
|
(in $ millions)
|
| |
2023E
|
| |
2024E
|
|
| |
(unaudited)
|
|||
Revenue
|
| |
$25.8
|
| |
$114.0
|
Net loss
|
| |
($11.5)
|
| |
($8.9)
|
Adjusted EBITDA(1)
|
| |
($11.9)
|
| |
($10.1)
|
Further Adjusted EBITDA(2)
|
| |
($2.7)
|
| |
$2.8
|
(1)
|
Adjusted EBITDA is defined as net loss before interest and other expense, net, income tax expense, other income and depreciation
of long-lived asset. Please see the section titled “The Business Combination—Certain Unaudited H2B2 Prospective Financial Information—Non-GAAP Financial Measures.”
|
(2)
|
Further Adjusted EBITDA is defined net loss before interest and other expense, net, income tax expense, other income,
depreciation of long-lived asset, and one-off expenses, and include grant funding and dividends from minority investments in projects. Please see the section titled “The Business Combination—Certain
Unaudited H2B2 Prospective Financial Information—Non-GAAP Financial Measures.”
|
(in $ millions)
|
| |
2023E
|
| |
2024E
|
| |
2025E
|
Revenue
|
| |
$15.8
|
| |
$78.4
|
| |
$206.8
|
Net loss
|
| |
($16.6)
|
| |
($17.1)
|
| |
$7.4
|
Adjusted EBITDA(1)
|
| |
($17.1)
|
| |
($17.8)
|
| |
$8.6
|
Further Adjusted EBITDA(2)
|
| |
($8.0)
|
| |
($4.8)
|
| |
$20.5
|
(1)
|
Adjusted EBITDA is defined as net loss before interest and other expense, net, income tax expense, other income and depreciation
of long-lived asset. Please see the section titled “The Business Combination—Certain Unaudited H2B2 Prospective Financial Information—Non-GAAP Financial Measures.”
|
(2)
|
Further Adjusted EBITDA is defined net loss before interest and other expense, net, income tax expense, other income,
depreciation of long-lived asset, and one-off expenses, and include grant funding and dividends from minority investments in projects. Please see the section titled “The Business Combination—Certain
Unaudited H2B2 Prospective Financial Information—Non-GAAP Financial Measures.”
|
(in $ millions)
|
| |
2023E
|
| |
2024E
|
| |
2025E
|
Revenue
|
| |
$12.0
|
| |
$78.6
|
| |
$206.6
|
Net loss
|
| |
($20.9)
|
| |
($16.3)
|
| |
$3.9
|
Adjusted EBITDA(1)
|
| |
($21.2)
|
| |
($16.0)
|
| |
$5.2
|
Further Adjusted EBITDA(2)
|
| |
($7.9)
|
| |
($5.8)
|
| |
$16.7
|
(1)
|
Adjusted EBITDA is defined as net loss before interest and other expense, net, income tax expense, other income and depreciation
of long-lived asset. Please see the section titled “The Business Combination—Certain Unaudited H2B2 Prospective Financial Information—Non-GAAP Financial Measures”
|
(2)
|
Further Adjusted EBITDA is defined net loss before interest and other expense, net, income tax expense, other income,
depreciation of long-lived asset, and one-off expenses, and include grant funding and dividends from minority investments in projects. Please see the section titled “The Business Combination—Certain
Unaudited H2B2 Prospective Financial Information—Non-GAAP Financial Measures”
|
(in $ millions)
|
| |
2023E
|
| |
2024E
|
| |
2025E(1)
|
Revenue
|
| |
$12.0
|
| |
$29.3
|
| |
$50.0-150.0
|
Net loss
|
| |
($16.8)
|
| |
($24.9)
|
| |
($15.4)
|
Adjusted EBITDA(2)
|
| |
($18.5)
|
| |
($26.1)
|
| |
($14.3)
|
Further Adjusted EBITDA(3)
|
| |
$2.5
|
| |
($23.4)
|
| |
($12.5)
|
(1)
|
Net loss, Adjusted EBITDA and Further Adjusted EBITDA based off of $50.0 million of Revenue.
|
(2)
|
Adjusted EBITDA is defined as net loss before interest and other expense, net, income tax expense, other income and
depreciation of long-lived asset. Please see the section titled “The Business Combination—Certain Unaudited H2B2 Prospective Financial Information—Non-GAAP Financial Measures”
|
(3)
|
Further Adjusted EBITDA is defined net loss before interest and other expense, net, income tax expense, other income,
depreciation of long-lived asset, and one-off expenses, and include grant funding and dividends from minority investments in projects. Please see the section titled “The Business
Combination—Certain Unaudited H2B2 Prospective Financial Information—Non-GAAP Financial Measures”
|
|
| |
2023E
|
| |
2024E
|
|
| |
(unaudited)
|
|||
(in $ millions)
|
| |
|
| |
|
Net loss
|
| |
($11.5)
|
| |
($8.9)
|
(–) Income tax expense
|
| |
0.2
|
| |
1.0
|
(+) Interest and other expense, net
|
| |
—
|
| |
0.1
|
(–) Other income
|
| |
0.6
|
| |
1.9
|
(+) Depreciation of long-lived assets
|
| |
0.4
|
| |
1.5
|
Adjusted EBITDA
|
| |
($11.9)
|
| |
($10.1)
|
(+) Grant funding
|
| |
6.0
|
| |
13.0
|
(+) One-off expenses
|
| |
3.2
|
| |
—
|
(+) Dividends from Minority Interest Projects
|
| |
—
|
| |
—
|
Further Adjusted EBITDA
|
| |
($2.7)
|
| |
$2.8
|
|
| |
2023E
|
| |
2024E
|
| |
2025E
|
|
| |
(unaudited)
|
||||||
(in $ millions)
|
| |
|
| |
|
| |
|
Net loss
|
| |
($16.6)
|
| |
($17.1)
|
| |
$7.4
|
(+) Income tax expense
|
| |
—
|
| |
—
|
| |
0.4
|
(+) Interest and other expense, net
|
| |
—
|
| |
0.1
|
| |
0.3
|
(-) Other income
|
| |
0.6
|
| |
1.9
|
| |
3.1
|
(+) Depreciation of long-lived assets
|
| |
0.1
|
| |
1.2
|
| |
3.8
|
Adjusted EBITDA
|
| |
($17.1)
|
| |
($17.8)
|
| |
$8.6
|
(+) Grant funding
|
| |
6.0
|
| |
13.0
|
| |
11.8
|
(+) One-off expenses
|
| |
3.1
|
| |
—
|
| |
—
|
(-) Dividends from Minority Interest Projects
|
| |
—
|
| |
—
|
| |
(0.1)
|
Further Adjusted EBITDA
|
| |
($8.0)
|
| |
($4.8)
|
| |
$20.5
|
|
| |
2023E
|
| |
2024E
|
| |
2025E
|
|
| |
(unaudited)
|
||||||
(in $ millions)
|
| |
|
| |
|
| |
|
Net loss
|
| |
($20.9)
|
| |
($16.3)
|
| |
$3.9
|
(+) Income tax expense
|
| |
—
|
| |
—
|
| |
0.2
|
(+) Interest and other expense, net
|
| |
—
|
| |
0.1
|
| |
0.3
|
(-) Other income
|
| |
(0.7)
|
| |
(1.7)
|
| |
(2.9)
|
(+) Depreciation of long-lived assets
|
| |
0.3
|
| |
1.9
|
| |
3.7
|
Adjusted EBITDA
|
| |
($21.2)
|
| |
($16.0)
|
| |
$5.2
|
(+) Grant funding
|
| |
7.2
|
| |
10.2
|
| |
11.5
|
(+) One-off expenses
|
| |
6.2
|
| |
—
|
| |
—
|
(-) Dividends from Minority Interest Projects
|
| |
—
|
| |
—
|
| |
0.1
|
Further Adjusted EBITDA
|
| |
($7.9)
|
| |
($5.8)
|
| |
$16.7
|
|
| |
2023E
|
| |
2024E
|
| |
2025E(1)
|
|
| |
(unaudited)
|
||||||
(in $ millions)
|
| |
|
| |
|
| |
|
Net loss
|
| |
($16.8)
|
| |
($24.9)
|
| |
($15.4)
|
|
| |
2023E
|
| |
2024E
|
| |
2025E(1)
|
|
| |
(unaudited)
|
||||||
(in $ millions)
|
| |
|
| |
|
| |
|
(+) Income tax expense
|
| |
—
|
| |
—
|
| |
—
|
(+) Interest and other expense, net
|
| |
1.4
|
| |
2.2
|
| |
2.1
|
(-) Other income
|
| |
(3.2)
|
| |
(4.8)
|
| |
(2.7)
|
(+) Depreciation of long-lived assets
|
| |
0.1
|
| |
1.4
|
| |
1.8
|
Adjusted EBITDA
|
| |
($18.5)
|
| |
($26.1)
|
| |
($14.3)
|
(+) Grant funding
|
| |
11.1
|
| |
1.0
|
| |
1.6
|
(+) One-off expenses
|
| |
9.8
|
| |
1.7
|
| |
—
|
(-) Dividends from Minority Interest Projects
|
| |
—
|
| |
—
|
| |
0.1
|
Further Adjusted EBITDA
|
| |
$2.5
|
| |
($23.4)
|
| |
($12.5)
|
(1)
|
Figures based off of $50.0 million of Revenue.
|
•
|
The Sponsor paid an aggregate of $12,349,495 for its purchases of the Founder Shares and the RMG III Private Placement Warrants.
Prior to the Initial Public Offering, the Sponsor purchased 10,062,500 Founder Shares for an aggregate purchase price of $25,000. Subsequently, RMG III effectuated a 5-for-6 share split of the RMG III Class B Ordinary Shares, resulting
in an aggregate outstanding amount of 12,075,000 Founder Shares outstanding. Simultaneously with the consummation of the Initial Public Offering, the Sponsor purchased 8,216,330 RMG III Private Placement Warrants for an aggregate
purchase price of $12,324,495 in a private placement. A portion of the proceeds from the sale of the RMG III Private Placement Warrants were added to the net proceeds from the Initial Public Offering held in the Trust Account. If the
Business Combination with H2B2 or another business combination is not consummated within the Completion Window, RMG III will cease all operations except for the purpose of winding up, redeeming the outstanding Public Shares for cash
and, subject to the approval of its remaining RMG III shareholders and the RMG III Board, dissolving and liquidating. In such event, the 12,075,000 Founder Shares held by the Initial Shareholders would be worthless because the Initial
Shareholders are not entitled to participate in any redemption or distribution with respect to such shares. Additionally, in such event, the 8,216,330 RMG III Private Placement Warrants will also expire worthless. The Founder Shares had
an aggregate market value of $ based upon the closing price of $ per share of RMG III Class A Ordinary Shares on Nasdaq on the RMG III Record Date. The RMG III Private Placement Warrants had an aggregate market value of
approximately $ based upon the closing price of $ per Public Warrant on the Nasdaq on the RMG III Record Date.
|
•
|
In order to finance transaction costs in connection with a business combination, the Sponsor, members of the RMG III founding
team or any of their affiliates may, but are not obligated to (other than pursuant to the January 2022 Note and the July 2022 Note), make certain working capital loans as may be required. On January 19, 2022, RMG Acquisition Management
agreed to lend RMG III up to an aggregate of $500,000 for working capital purposes, pursuant to the January 2022 Note. The January 2022 Note is due and payable in full by RMG III upon the consummation of a business combination. On
July 27, 2022, RMG Acquisition Management agreed to lend RMG III up to $475,000 for working capital purposes, pursuant to the July 2022 Note. The July 2022 Note is due and payable in full by RMG III upon the consummation of a business
combination. In the event that the Business Combination does not close, RMG III may use a portion of proceeds held outside the Trust Account to repay the January 2022 Note and the July 2022 Note, but no proceeds held in the Trust
Account would be used to repay the January 2022 Note or the July 2022 Note. The January 2022 Note and the July 2022 Note will be repaid in cash upon consummation of the Business Combination. As of the date hereof, RMG III has borrowed
$500,000 under the January 2022 Note and $350,000 under the July 2022 Note. If RMG III does not complete a business combination by the Completion Window, there will not be sufficient assets to repay the outstanding balance under the
January 2022 Note and the July 2022 Note, and the January 2022 Note and the July 2022 Note will be worthless.
|
•
|
There will be no finder’s fees, reimbursements or cash payments made by RMG III to the Sponsor or RMG III’s officers or
directors, or RMG III’s or any of their affiliates, for services rendered to RMG III prior to or in connection with the completion of the Business Combination, other than payment of the amount described below for office space,
utilities, administrative and support services described below and repayments of any outstanding balance of the January 2022 Note and the July 2022 Note, as described below. RMG III’s directors and officers and their affiliates are
entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on
|
•
|
The Sponsor (including RMG III’s directors, officers and Initial Shareholders and their permitted transferees) owns RMG III
Private Placement Warrants which, in the event the Warrant Amendment Proposal is approved prior to the Effective Time, will be converted into the right to receive up to 0.075 shares of Surviving Corporation Common Stock per RMG III
Private Placement Warrant.
|
•
|
RMG III’s existing directors and officers will be eligible for continued indemnification and continued coverage under RMG III’s
directors’ and officers’ liability insurance after the Business Combination pursuant to the Merger Agreement.
|
•
|
In the event of the liquidation of the Trust Account, the Sponsor has agreed, under the Letter Agreement, dated February 4,
2021, among RMG III, the Sponsor and RMG III’s officers and directors, to indemnify and hold harmless RMG III against any and all losses, liabilities, claims, damages and expenses to which RMG III may become subject as a result of any
claim by (i) any third party for services rendered or products sold to RMG III or (ii) a prospective target business with which RMG III has entered into an acquisition agreement; provided that
such indemnification of RMG III by the Sponsor will apply only to the extent necessary to ensure that such claims by a third party for services rendered or products sold to RMG III or a target do not reduce the amount of funds in the
Trust Account to below (i) $10.00 per share of RMG III Class A Ordinary Shares or (ii) such lesser amount per RMG III Class A Ordinary Share held in the Trust Account due to reductions in the value of the trust assets as of the date of
the liquidation of the Trust Account, in each case, net of the amount of interest earned on the property in the Trust Account, which may be withdrawn to pay taxes, expenses related to the administration of the Trust Account and limited
withdrawals for working capital, except as to any claims by a third party (including a target) who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under RMG III’s indemnity of the
IPO Underwriters against certain liabilities, including liabilities under the Securities Act. If RMG III consummates the Business Combination, on the other hand, RMG III will be liable for all such claims.
|
•
|
Pursuant to the Sponsor Support Agreement, the Sponsor has agreed to, subject to certain exceptions, among other things, vote in
favor of the Merger Agreement and the transactions contemplated thereby, in each case, subject to the terms and conditions contemplated by the Sponsor Support Agreement.
|
•
|
Subject to certain limited exceptions, the Surviving Corporation Common Stock will not be transferable following the Closing
until the date that is 180 days after the Closing.
|
•
|
Certain of RMG III’s officers and directors presently have, and any of them in the future may have additional, fiduciary or
contractual obligations to other entities pursuant to which such officer or director is or will be required to present business combination opportunities to such entity. Accordingly, in the future, if any of RMG III’s officers or
directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations
to present such opportunity to such entity. RMG III does not believe, however, that any fiduciary duties or contractual obligations of its officers or directors would materially undermine RMG III’s ability to complete a
|
•
|
Certain of H2B2’s directors and officers hold outstanding H2B2 Options which, pursuant to the terms of the Merger Agreement,
will be converted into options to purchase shares of Surviving Corporation Common Stock, based on the Exchange Ratio (each, a “Converted Option”). Each Converted Option will otherwise be subject
to the same terms and conditions as applied to the underlying H2B2 Option immediately prior to the Effective Time, including with respect to vesting and termination-related provisions. The following table sets forth, for each of H2B2’s
officers, the number of shares of H2B2
|
Name
|
| |
Shares Subject to
Vested Options
|
| |
Shares Subject to
Unvested Options
|
Executive Officers
|
| |
|
| |
|
Anselmo Andrade Fernández de Mesa
|
| |
|
| |
|
Florencio Ferrera Saldaña
|
| |
|
| |
|
Felipe Benjumea Llorente
|
| |
|
| |
|
Javier Brey Sánchez
|
| |
|
| |
|
Blanca Benjumea de Porres
|
| |
|
| |
|
Felipe Benjumea de Porres
|
| |
|
| |
|
África Castro Rosende
|
| |
|
| |
|
|
| |
|
| |
|
Directors
|
| |
|
| |
|
Antonio Vázquez Romero(1)
|
| |
|
| |
|
Ignacio Solis
|
| |
|
| |
|
Gonzalo Hidalgo
|
| |
|
| |
|
Guillermo Delclaux
|
| |
|
| |
|
Manuel Delclaux
|
| |
|
| |
|
Fernando Franco
|
| |
|
| |
|
Juan Suarez
|
| |
|
| |
|
(1)
|
In April 2023, Mr. Vázquez exercised the First Vázquez H2B2 Option in full, subject to and conditioned upon the Closing. In
December 2023, the conditional exercise of such option was rescinded, and such option was amended to permit Mr. Vázquez to exercise such option during the period beginning on the date on which Mr. Vázquez became the non-executive
chairman of the H2B2 Board and ending on the third anniversary of the effective date of such option amendment. Pursuant to his service agreement with H2B2, in December 2022, Mr. Vázquez was granted the Second Vázquez H2B2 Option. The
number of shares of H2B2 Common Stock subject to the Second Vázquez H2B2 Option will be determined by dividing $750,000 by the exchange price of the Company’s shares in the Business Combination.
|
Name
|
| |
Age
|
| |
Title
|
Antonio Vázquez Romero
|
| |
71
|
| |
Chairman of the Board, Director
|
Anselmo Andrade Fernández de Mesa
|
| |
30
|
| |
Chief Executive Officer, Director
|
Blanca Benjumea de Porres
|
| |
33
|
| |
Chief Financial Officer
|
Florencio Ferrera Saldaña
|
| |
53
|
| |
Chief Operating Officer
|
Javier Brey Sánchez
|
| |
49
|
| |
Chief Technology Officer
|
Felipe Benjumea de Porres
|
| |
29
|
| |
Chief Investment Officer, Director
|
África Castro Rosende
|
| |
51
|
| |
Business Development Officer
|
Blanca de Porres Guardiola
|
| |
59
|
| |
Director
|
Guillermo Delclaux Lezama Leguizamón
|
| |
40
|
| |
Director
|
Manuel Delclaux Lezama Leguizamón
|
| |
34
|
| |
Director
|
Robert S. Mancini
|
| |
66
|
| |
Director
|
Iván E. Mercado
|
| |
56
|
| |
Director
|
Sources
|
| |
|
| |
Uses
|
| |
|
($ in thousands)
|
| |
|
| |
|
| |
|
RMG III Cash*
|
| |
$6,966
|
| |
Transaction Accounting Costs****
|
| |
$19,325
|
Cash from H2B2
|
| |
$11,535
|
| |
Cash to Balance Sheet
|
| |
$26,301
|
Cash from convertible debt**
|
| |
$27,125
|
| |
|
| |
|
Total Sources
|
| |
$45,626
|
| |
Total Uses
|
| |
$45,626
|
Sources
|
| |
|
| |
Uses
|
| |
|
($ in thousands)
|
| |
|
| |
|
| |
|
RMG III Cash*
|
| |
$6,966
|
| |
Transaction Accounting Costs***
|
| |
$19,325
|
Cash from H2B2
|
| |
$11,535
|
| |
Cash to Balance Sheet
|
| |
$19,645
|
Cash from convertible debt**
|
| |
$27,125
|
| |
Maximum Right’s Redemption
|
| |
$6,655
|
Total Sources
|
| |
$45,626
|
| |
Total Uses
|
| |
$45,626
|
*
|
The amount of RMG III Cash reflects the amount in RMG III’s Trust Account and RMG III’s cash on the balance sheet, each as of
September 30, 2023.
|
**
|
See Footnotes (4) to the Unaudited Pro Forma Combined Balance Sheet as of September 30, 2023 included as part of the section
entitled “Unaudited Pro Forma Combined Financial Information” for further detail.
|
***
|
See the Footnotes to the Unaudited Pro Forma Combined Balance Sheet as of September 30, 2023 included as part of the section
entitled “Unaudited Pro Forma Combined Financial Information” for further detail.
|
•
|
1% of the total number of the shares of Surviving Corporation Common Stock then outstanding; or
|
•
|
the average weekly reported trading volume of Surviving Corporation Common Stock during the four calendar weeks preceding the
filing of a notice on Rule 144 with respect to the sale.
|
•
|
the issuer of the securities that was formerly a shell company has ceased to be a shell company (which the Surviving Corporation
will cease to be upon completion of the Business Combination);
|
•
|
the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act (which the
Surviving Corporation will be following the Business Combination);
|
•
|
the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the
preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Form 8-K reports; and
|
•
|
at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its
status as an entity that is not a shell company.
|
(a)
|
each share of H2B2 Common Stock issued and outstanding immediately prior to the Effective Time
|
(b)
|
each treasury share of H2B2 issued and outstanding immediately prior to the Effective Time will be canceled without
consideration;
|
(c)
|
each share of Domesticated RMG III Class A Stock (other than any Founder Consideration Shares that are shares of Domesticated
RMG III Class A Stock, which shall be treated pursuant to (d) below) issued and outstanding immediately prior to the Effective Time will remain as an issued and outstanding share of Surviving Corporation Common Stock;
|
(d)
|
a number of shares of RMG III Common Stock equal to the number of Founder Consideration Shares will convert into issued and
outstanding shares of Surviving Corporation Common Stock and the remaining shares of RMG III Common Stock issued and outstanding will be canceled without consideration; and
|
(e)
|
each H2B2 Option will be canceled and will convert into the right to receive an option to purchase, upon substantially the same
terms and conditions, a whole number of shares of Surviving Corporation Common Stock (rounded down to the nearest whole share) equal to the number of shares of H2B2 Common Stock subject to such H2B2 Option immediately prior to the
Effective Time multiplied by the Exchange Ratio (each, a “Surviving Corporation Option”), except that the exercise price per share of each such Surviving Corporation Option will be equal to the
exercise price per share of such H2B2 Option in effect immediately prior to the Effective Time, divided by the Exchange Ratio (rounded up to the nearest full cent).
|
(a)
|
any change in applicable laws or GAAP or any interpretation thereof following the date of the Merger Agreement;
|
(b)
|
any change in interest rates or economic, political, business or financial market conditions generally;
|
(c)
|
the taking of any action required by the Merger Agreement or any Ancillary Agreement;
|
(d)
|
any natural disaster (including hurricanes, storms, tornadoes, flooding, earthquakes, volcanic eruptions or similar
occurrences), pandemic or change in climate;
|
(e)
|
any acts of terrorism or war, the outbreak or escalation of hostilities, geopolitical conditions, local, national or
international political conditions;
|
(f)
|
any failure of H2B2 to meet any projections or forecasts (provided that the foregoing will not prevent a determination that any
Event not otherwise excluded from the definition of H2B2 Material Adverse Effect underlying such failure to meet projections or forecasts has resulted in a H2B2 Material Adverse Effect);
|
(g)
|
any Events generally applicable to the industries or markets in which H2B2 and its subsidiaries operate (including increases in
the cost of products, supplies, materials or other goods purchased from third-party suppliers);
|
(h)
|
the announcement of the Merger Agreement and the Ancillary Agreements and consummation of the transactions contemplated thereby,
including any termination of, reduction in or similar adverse impact (but in each case only to the extent attributable to such announcement or consummation) on relationships, contractual or otherwise, with any landlords, customers,
suppliers, distributors, partners, employees, workers or officers of H2B2 and its subsidiaries (it being understood that the foregoing will be disregarded for purposes of the representation and warranty set forth in the section of the
Merger Agreement titled “No Conflicts” and the corresponding condition to Closing);
|
(i)
|
any matter set forth in H2B2’s disclosure letter;
|
(j)
|
any Events to the extent actually known by certain individuals identified in RMG III’s disclosure letter on or prior to the date
of the Merger Agreement; or
|
(k)
|
any action taken by, or at the request of, RMG III or taken or not taken by H2B2 as required by the Merger Agreement or any
Ancillary Agreement.
|
•
|
the RMG III Shareholder Approval having been obtained;
|
•
|
the adoption and approval of the Merger Agreement and the transactions contemplated thereby by the H2B2 Stockholders having been
obtained;
|
•
|
the approval of the Warrant Amendment and the Warrant Exchange by RMG III warrant holders having been obtained;
|
•
|
the waiting period or periods (and any extension thereof) under the HSR Act applicable to the transactions contemplated by the
Merger Agreement and the Ancillary Agreements having expired or been terminated;
|
•
|
there will not be in force any order or law enjoining, preventing, prohibiting or making illegal the consummation of the
Merger; provided that the governmental authority issuing such order or law has jurisdiction over the parties with respect to the transactions contemplated by the Merger Agreement;
|
•
|
this Registration Statement becoming effective in accordance with the Securities Act, no stop order suspending the effectiveness
of this Registration Statement having been issued by the SEC that remains in effect, and no proceedings for that purpose having been initiated or threatened by the SEC and not withdrawn;
|
•
|
the shares of Surviving Corporation Common Stock to be issued in connection with the Merger having been approved for listing on
Nasdaq; and
|
•
|
the Capital Raise Transaction having been consummated with an aggregate Capital Raise Amount equal to at least the Minimum
Investment Amount.
|
•
|
the representations and warranties of H2B2 regarding its capitalization, as provided for in the Merger Agreement, having been
true and correct in all but de minimis respects as of the Closing Date, except with respect to such representations and warranties which speak as to an earlier date, which representations and
warranties having been true and correct in all but de minimis respects at and as of such date, except for changes after the date of the Merger Agreement which are contemplated or expressly
permitted by the Merger Agreement or the Ancillary Agreements;
|
•
|
the H2B2 Fundamental Representations (as defined below) (other than those portions of the capitalization representations
referenced above) having been true and correct in all material respects, in each case as of the Closing Date, except with respect to such representations and warranties which speak as to an earlier date, which representations and
warranties having been true and correct in all material respects at and as of such date, except for changes after the date of the Merger Agreement that are contemplated or expressly permitted by the Merger Agreement or the Ancillary
Agreements;
|
•
|
the remaining representations and warranties of H2B2 contained in the Merger Agreement (disregarding any qualifications and
exceptions contained therein relating to materiality, material adverse effect and H2B2 Material Adverse Effect or any similar qualification or exception) having been true and correct as of the Closing Date, except with respect to such
representations and warranties which speak as to an earlier date, which representations and warranties having been true and correct at and as of such date, except for, in each case, inaccuracies or omissions that would not, individually
or in the aggregate, reasonably be expected to have a H2B2 Material Adverse Effect;
|
•
|
each of the covenants of H2B2 to be performed as of or prior to the Closing having been performed in all material respects;
|
•
|
there will not have occurred a H2B2 Material Adverse Effect after the date of the Merger Agreement that is continuing; and
|
•
|
the following documentation having been delivered to RMG III pursuant to the Merger Agreement: (i) a certificate signed by an
officer of H2B2, dated as of the Closing Date, certifying that, to the knowledge and belief of such officer, certain conditions to the obligations of RMG III specified in the Merger Agreement have been fulfilled, (ii) the written
resignations of all of the directors of H2B2 (other than any such persons identified as initial directors of the Surviving Corporation pursuant to the Merger Agreement), effective as of the Effective Time, (iii) written evidence
(reasonably satisfactory to RMG III) of the termination of the H2B2 Stockholders Agreement according to its terms, (iv) the Registration Rights Agreement, duly executed by the H2B2 Stockholders party thereto, (v) the Lock-Up Agreement,
duly executed by the H2B2 Stockholders representing eighty percent (80%) of the shares of H2B2 Common Stock outstanding immediately prior to the Effective Time, (vi) if the Ardachon Proceedings will not have been terminated prior to
Closing, a letter agreement addressing the obligations set forth on H2B2’s disclosure letter, and (vii) a certificate on behalf of H2B2, prepared in
|
•
|
the representations and warranties of RMG III regarding its capitalization, as provided for in the Merger Agreement, having been
true and correct in all but de minimis respects as of the Closing Date, except with respect to such representations and warranties which speak as to an earlier date, which representations and
warranties having been true and correct in all but de minimis respects at and as of such date, except for changes after the date of the Merger Agreement which are contemplated or expressly
permitted by the Merger Agreement;
|
•
|
the RMG III Fundamental Representations (as defined below) (other than the capitalization representations referenced above)
having been true and correct in all material respects, in each case as of the Closing Date, except with respect to such representations and warranties which speak as to an earlier date, which representations and warranties will be true
and correct in all material respects at and as of such date, except for changes after the date of the Merger Agreement which are contemplated or expressly permitted by this Agreement or the Ancillary Agreements;
|
•
|
the remaining representations and warranties of RMG III contained in the Merger Agreement (disregarding any qualifications and
exceptions contained therein relating to materiality, material adverse effect or any similar qualification or exception) having been true and correct in all material respects, in each case as of the Closing Date, except with respect to
such representations and warranties which speak as to an earlier date, which representations and warranties will be true and correct in all material respects at and as of such date, except for changes after the date of the Merger
Agreement which are contemplated or expressly permitted by the Merger Agreement or the Ancillary Agreements;
|
•
|
each of the covenants of RMG III to be performed as of or prior to the Closing having been performed in all material respects;
|
•
|
the Domestication having been completed as contemplated by the Merger Agreement and a time-stamped copy of the certificate
issued by the Secretary of State of the State of Delaware in relation to such certificate having been delivered to H2B2. See the section entitled “Proposal No. 2—The Domestication Proposal” for
more information; and
|
•
|
the following documentation having been delivered, or caused to be delivered, by RMG III pursuant to the Merger Agreement:
(i) to the Exchange Agent, the Aggregate Closing Date Merger Consideration for further distribution to H2B2 Stockholders pursuant to the Merger Agreement, (ii) to H2B2, a certificate signed by an officer of RMG III, dated the Closing
Date, certifying that, to the knowledge and belief of such officer, certain conditions to the obligations of H2B2 have been fulfilled, (iii) to H2B2, the Registration Rights Agreement and each Lock-Up Agreement, duly executed by duly
authorized representatives of RMG III and the Sponsor, and the other parties thereto, (iv) to H2B2, the written resignations of all of the directors and officers of RMG III (other than those persons identified as the initial directors
and officers, respectively, of the Surviving Corporation after the Effective Time, in accordance with the Merger Agreement), effective as of the Effective Time, (v) to H2B2, a time-stamped copy of the certificate issued by the Secretary
of State of the State of Delaware in relation to the Domestication and (vi) to H2B2, an Internal Revenue Service Form W-9.
|
•
|
change or amend the H2B2 Stockholders Agreement;
|
•
|
change or amend the governing documents of H2B2 or any of its subsidiaries other than in connection with the matters set forth
in H2B2’s disclosure letter;
|
•
|
form or cause to be formed any new subsidiary of H2B2;
|
•
|
make or declare any dividend or distribution to the H2B2 Securityholders or make any other distributions in respect of any of
the H2B2 Common Stock or Equity Interests;
|
•
|
split, combine, reclassify, recapitalize or otherwise amend any terms of any shares of H2B2 Common Stock or any of H2B2’s
subsidiaries’ capital stock or Equity Interests, except for any such transaction by a wholly-owned subsidiary of H2B2 that remains a wholly-owned subsidiary of H2B2 after consummation of such transaction;
|
•
|
purchase, repurchase, redeem or otherwise acquire any issued and outstanding share capital, outstanding shares of capital stock,
membership interests or other Equity Interests of H2B2 or its subsidiaries, except for: (i) the acquisition by H2B2 or any of its subsidiaries of any shares of capital stock, membership interests or other Equity Interests (other than
H2B2 Options) of H2B2 or its subsidiaries in connection with the forfeiture or cancellation of such interests, including, for the avoidance of doubt, redemptions of equity securities from former employees, workers or officers of H2B2 or
any of its subsidiaries upon the terms set forth in the underlying agreements governing such equity securities; (ii) the Ardachon Share Acquisition; (iii) transactions between H2B2 and any wholly-owned subsidiary of H2B2 or between
wholly-owned subsidiaries of H2B2; (iv) the acquisition by H2B2 of shares of H2B2 Common Stock in connection with the surrender of shares of H2B2 Common Stock by holders of H2B2 Options in order to pay the exercise price of such H2B2
Options; and (v) the withholding of shares of H2B2 Common Stock to satisfy tax obligations with respect to H2B2 Options, in each of clauses (iv) and (v), solely to the extent and in accordance with their terms as previously disclosed to
RMG III;
|
•
|
enter into, modify in any material respect or terminate (other than expiration in accordance with its terms) any material
contracts, or any real property lease, in each case, other than entry into such agreements in connection with the (i) the Ardachon Share Acquisition, (ii) the Capital Raise Transaction, or (iii) in the ordinary course of business
consistent with past practice or as required by law;
|
•
|
sell, assign, transfer, convey, lease or otherwise dispose of any material portion of tangible assets or properties of H2B2 or
its subsidiaries, except for (i) dispositions of obsolete or worthless equipment, (ii) transactions among H2B2 and its wholly-owned subsidiaries or among its wholly-owned subsidiaries, and (iii) transactions in the ordinary course of
business consistent with past practice;
|
•
|
acquire any ownership interest in any real property;
|
•
|
except as otherwise required by law, an existing H2B2 benefit plan or certain contractual obligations, (i) grant any material
severance, retention, change in control or termination or similar pay to any employee, worker or officer of H2B2 or any of its subsidiaries, (ii) make any change in the key management structure of H2B2 or any of its subsidiaries,
(iii) hire or engage, or make an offer to hire or engage, any employee, worker or officer with an annual base compensation of $250,000 or more, (iv) terminate the employment or engagement of any employee, worker or officer with an
annual base compensation of $250,000 or more, other than terminations for cause or due to death or disability, (v) terminate, adopt, enter into or materially amend any H2B2 benefit plan, except in the ordinary course of business
consistent with past practice, (vi) materially increase the cash compensation or bonus opportunity of any employee, worker or officer of H2B2 or any of its subsidiaries, except in the ordinary course of business consistent with past
practice, (vii) establish any trust or take any other action to secure the payment of any compensation payable by H2B2 or any of its subsidiaries, (viii) take any action to amend or waive any performance or vesting criteria or to
accelerate the time of payment or vesting of any compensation or benefit payable by H2B2 or any of its subsidiaries or (ix) grant any equity or equity-based compensation to any employee, worker or officer of H2B2 or any of its
subsidiaries;
|
•
|
acquire by merger or consolidation with, or merge or consolidate with, or purchase substantially all or a material portion of
the assets of, any corporation, partnership, association, joint venture or other business organization or division thereof;
|
•
|
(i) issue or sell any debt securities or warrants or other rights to acquire any debt securities of H2B2 or any of its
subsidiaries or otherwise incur or assume any indebtedness, or (ii) guarantee any indebtedness of another person, the sum of (i) and (ii) not to be in excess of $10,000,000 in the aggregate, in each case, other than in the ordinary
course of business consistent with past practice, or in connection with the Ardachon Share Acquisition;
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(i) make or change any material election in respect of material taxes, (ii) materially amend any filed material tax return,
(iii) adopt or request permission of any taxing authority to change any accounting method in respect of material taxes, (iv) enter into any “closing agreement” as described in Section 7121 of the Code (or any similar provision of state,
local, or foreign law) with any governmental authority in respect of material taxes executed on or prior to the Closing Date or enter into any tax sharing or similar agreement (other than any such agreement solely between H2B2 and its
existing subsidiaries and customary commercial contracts (or contracts entered into in the ordinary course of business) not primarily related to taxes), (v) settle any claim or assessment in respect of material taxes or (vi) consent to
any extension or waiver of the limitation period applicable to any claim or assessment in respect of material taxes (other than automatic extensions to file tax returns), in each case, if such action would be reasonably expected to have
an adverse effect on H2B2, RMG III or any of their subsidiaries after the Closing Date;
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take any action, or knowingly fail to take any action, where such action or failure to act would reasonably be expected to
prevent the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code and the Treasury Regulations promulgated thereunder, or as a “fusión” within the meaning
of Section 76.1 of the Spanish CIT Act benefiting from the tax treatment provided in Title VII, Chapter VII, of the Spanish CIT Act, and in particular, Section 77.1.e), 78.1 and 81 thereunder;
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discharge any secured or unsecured obligation or liability (whether accrued, absolute, contingent or otherwise) in excess of
$10,000,000, except as such obligations become due in the ordinary course and subject to the terms of each applicable contract, other than in connection with the Ardachon Share Acquisition or in connection with the Capital Raise
Transaction;
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issue any additional shares of H2B2 Common Stock or securities exercisable for or convertible into H2B2 Common Stock, other than
(i) the issuance of H2B2 Common Stock upon the exercise of H2B2 Options in the ordinary course of business or (ii) in connection with the Capital Raise Transaction;
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adopt a plan of, or otherwise enter into or effect a, complete or partial liquidation, dissolution, restructuring,
recapitalization or other reorganization of H2B2 or its subsidiaries (other than the Merger);
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waive, release, settle, compromise or otherwise resolve any inquiry, investigation, claim, litigation or other actions or legal
proceedings, except where such waivers, releases, settlements or compromises involve only the payment of monetary damages in an amount less than $250,000 in the aggregate;
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assign, transfer, pledge, sell or license to any person rights to any intellectual property owned by H2B2 or any of its
subsidiaries, or dispose of, abandon, permit to lapse or fail to renew such intellectual property, except for the expiration of intellectual property rights in accordance with the applicable statutory term, or for the grant of
non-exclusive licenses in the ordinary course of business, consistent with past practice;
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modify in any material respect any of H2B2’s privacy policies, or any administrative, technical or physical safeguards related
to privacy or cybersecurity, except (i) to remediate any security issue, (ii) to enhance data security or integrity, (iii) to comply with applicable law, or (iv) as otherwise directed or required by a governmental authority;
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disclose or agree to disclose to any person (other than RMG III or any of its representatives) any material trade secret or any
other material confidential or proprietary information of H2B2 or any of its subsidiaries, other than to persons who are subject to a contractual, legal, or enforceable ethical obligation to maintain the confidentiality thereof;
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except as set forth on H2B2’s disclosure letter, make or commit to make any CapEx in an amount greater than $250,000 in the
aggregate;
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manage H2B2’s and its subsidiaries’ working capital (including paying amounts payable in a timely manner when due and payable)
in a manner other than in the ordinary course of business consistent with past practice;
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other than as required by applicable law, modify, enter into or extend any collective bargaining agreement or any other
labor-related agreements or arrangements with any labor union, labor
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terminate without replacement or fail to use reasonable efforts to maintain any license material to the conduct of the business
of H2B2 and its subsidiaries, taken as a whole;
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waive the restrictive covenant obligations of any current or former employee, worker or officer of H2B2 or any of its
subsidiaries;
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(i) limit the right of H2B2 or any of the its subsidiaries to engage in any line of business or in any geographic area, to
develop, market or sell products or services, or to compete with any person or (ii) grant any exclusive rights to any person, in each case, except where such limitation or grant does not, and would not be reasonably likely to,
individually or in the aggregate, materially and adversely affect, or materially disrupt, the ordinary course operation of the businesses of H2B2 and its subsidiaries, taken as a whole;
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terminate without replacement or amend in a manner materially detrimental to H2B2 and its subsidiaries, taken as a whole, any
insurance policy insuring the business of H2B2 or any of its subsidiaries; or
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enter into any agreement to do any action specified above.
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change, modify or amend the Trust Agreement or the RMG III Governing Documents, except as otherwise contemplated by the
Proposals;
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(i) make or declare any dividend or distribution to RMG III shareholders or make any other distributions in respect of any of
RMG III’s share capital, (ii) split, combine, reclassify, recapitalize or otherwise amend any terms of any shares or series of RMG III’s share capital or Equity Interests, or (iii) purchase, repurchase, redeem or otherwise acquire any
issued and outstanding share capital, outstanding shares of capital stock, share capital or membership interests, warrants or other Equity Interests of RMG III, other than a redemption of RMG III Class A Ordinary Shares effected in
connection with the Proposals;
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(i) make or change any material election in respect of material taxes, (ii) amend any filed material tax return, (iii) adopt or
request permission of any taxing authority to change any accounting method in respect of material taxes, (iv) enter into any “closing agreement” as described in Section 7121 of the Code (or any similar provision of state, local, or
foreign law) with any governmental authority in respect of material taxes or enter into any tax sharing or similar agreement, (v) settle any claim or assessment in respect of material taxes, or (vi) consent to any extension or waiver of
the limitation period applicable to any claim or assessment in respect of material taxes;
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take any action, or knowingly fail to take any action, where such action or failure to act would reasonably be expected to
prevent the Merger from qualifying as a “reorganization” within the
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other than as expressly required by the Sponsor Support Agreement, enter into, renew or amend in any material respect, any
transaction or contract with an affiliate of RMG III including, for the avoidance of doubt, (i) the Sponsor and (ii) any person in which the Sponsor has a direct or indirect legal, contractual or beneficial ownership interest of 5% or
greater;
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except as contemplated by the Incentive Plan, (i) enter into, adopt or amend any RMG III benefit plan, or enter into any
employment contract or collective bargaining agreement that would cover employees of RMG III following Closing, or (ii) hire any employee or any other individual to provide services to RMG III following Closing;
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incur or assume any indebtedness or guarantee any indebtedness of another person, issue or sell any debt securities or warrants
or other rights to acquire any debt securities of H2B2 or any of its subsidiaries or guaranty any debt securities of another person, or otherwise knowingly and purposefully incur, guarantee or otherwise become liable for (whether
directly, contingently or otherwise) any other material liabilities, debts or obligations, other than (i) fees and expenses, including finder’s fees, for professional services incurred in support of the transactions contemplated by the
Merger Agreement and the Ancillary Agreements or in support of the ordinary course operations of RMG III (which the parties agree will include any indebtedness in respect of any Working Capital Loans outstanding as of the Effective
Time) or (ii) any indebtedness for borrowed money or guarantee incurred in the ordinary course of business consistent with past practice;
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(i) issue any RMG III securities or securities exercisable for or convertible into RMG III securities, other than the issuance
(x) of the Aggregate Closing Date Merger Consideration, (y) of Surviving Corporation Options, in connection with the Merger, and (z) in connection with any financing arrangement or efforts contemplated by the Merger Agreement,
(ii) grant any options, warrants or other equity-based awards with respect to RMG III securities not outstanding on the date hereof, or (iii) amend, modify or waive any of the material terms or rights set forth in any RMG III Warrant or
the Warrant Agreement, including any amendment, modification or reduction of the warrant price set forth therein; or
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enter into any agreement to do any action specified above.
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RMG III to take certain actions so that, among other things, (i) the trustee of the Trust Account will pay when due all amounts
payable to RMG III shareholders following any RMG III shareholder redemptions, and pay all remaining amounts, less the fees and costs incurred by the trustee under the Trust Agreement then available in the Trust Account to RMG III for
immediate use and thereafter the Trust Account will terminate, in each case, pursuant to the terms and subject to the terms and conditions of the Trust Agreement;
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during the Interim Period, RMG III to ensure it remains listed as a public company on Nasdaq and to use reasonable best efforts
to obtain approval for the listing of Surviving Corporation Common Stock on Nasdaq from and after the Effective Time;
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RMG III to approve and adopt the Incentive Plan, which provides for grants of awards to eligible service providers, with an
Initial Share Reserve that is reasonably satisfactory to RMG III;
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during the Interim Period, (i) RMG III not, and to instruct its representatives not to, (x) make any proposal or offer relating
to certain alternative or proposed transactions, (y) initiate any discussions or negotiations with any person with respect to such alternative or proposed transactions, or (z) enter into
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subject to obtaining the RMG III Shareholder Approval, RMG III to cause the Domestication to become effective at least one (1)
business day prior to the Effective Time (see the section entitled “Proposal No. 2—The Domestication Proposal” for more information);
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the Surviving Corporation to provide customary indemnification of, and provision of insurance with respect to, present and
former officers and directors of RMG III, H2B2 and each of H2B2’s subsidiaries;
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during the Interim Period, RMG III to keep current and timely file all reports required to be filed or furnished with the SEC
and otherwise comply in all material respects with its reporting obligations under applicable law;
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if the Closing has not occurred by June 28, 2023, and unless the Merger Agreement has been validly terminated, RMG III to take,
in accordance with applicable law and the RMG III Governing Documents, all commercially reasonable actions necessary to (i) establish a record date for, give, publish the notice of, convene, schedule and hold a meeting of RMG III
shareholders to consider the adoption and approval of an extension of the deadline by which RMG III must complete a business combination, in each case, on a month-to-month basis up to the earlier of the Closing or the valid termination
of the Merger Agreement and (ii) obtain approval of such extension by RMG III shareholders, in each case of clauses (i) and (ii) prior to August 9, 2023;
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on the Closing Date, RMG III to amend, or cause to be amended, the Warrant Agreement to provide that each outstanding RMG III
Warrant represents the right to receive up to 0.075 shares of Surviving Corporation Common Stock.
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during the Interim Period, H2B2 to grant RMG III and its accountants, counsel and other representatives reasonable access to its
properties, books, contracts, commitments, tax returns, records and appropriate officers and employees of H2B2 and its subsidiaries and to furnish such representatives with all financial and operating data and other information
concerning the affairs of H2B2 and its subsidiaries;
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H2B2 (i) to deliver to RMG III, as soon as reasonably practicable and no later than the dates set forth in the Merger Agreement,
certain audited and unaudited financial statements which comply in all material respects with applicable accounting requirements and with the rules and regulations of the SEC, the Exchange Act and the Securities Act, (ii) to deliver to
RMG III, as soon as reasonably practicable, any additional financial or other information reasonably requested by RMG III to prepare pro forma financial statements required under federal securities laws to be included in RMG III’s
filings with the SEC (including this proxy statement) which comply with the rules and regulations of the SEC, (iii) to cooperate with RMG III to prepare such pro forma financial statements, and (iv) to use reasonable best efforts to
cause its independent auditors to provide any necessary consents to the inclusion of H2B2’s financial statements in RMG III’s filings with the SEC in accordance with the applicable requirements of federal securities laws;
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during the Interim Period, H2B2 not to, and to instruct and use reasonable best efforts to cause its representatives not to,
(i) initiate any negotiations with any person with respect to certain alternative or proposed transactions, (ii) enter into an agreement with respect to any such alternative or proposed transactions, (iii) grant any waiver, amendment or
release under any confidentiality agreement or the anti-takeover laws of any state, or (iv) otherwise knowingly facilitate any inquiries, proposals, discussions, or negotiations or any effort or attempt by any person to make a proposal
with respect to any such alternative or proposed transactions;
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each of RMG III and H2B2 to (and, to the extent required, to cause its affiliates to) comply promptly with the notification and
reporting requirements of the HSR Act and to use reasonable best efforts to comply with any information or document requests;
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each of RMG III and H2B2 to (and to cause its affiliates to) exercise its reasonable best efforts to (i) obtain termination or
expiration of any applicable waiting periods under the HSR Act, (ii) prevent the entry, in any action brought by an antitrust authority or any other person, of any governmental order which would prohibit, make unlawful or delay the
consummation of the transactions contemplated hereby, and (iii) if any such governmental order is issued in any such action, cause such governmental order to be lifted;
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each of RMG III and H2B2 to (i) use reasonable best efforts to obtain any necessary or advisable clearance, approval, consent,
or governmental authorization under laws prescribed or enforceable by any governmental authority for the transactions contemplated by the Merger Agreement and to resolve any objections as may be asserted by any governmental authority
with respect to the transactions contemplated by the Merger Agreement and (ii) cooperate fully with each other in the defense of such matters;
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RMG III and H2B2 to jointly prepare and RMG III to file with the SEC this Registration Statement and proxy statement to be sent
to RMG III shareholders relating to the Special Meeting;
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RMG III and H2B2 to, and to cause its subsidiaries to, use reasonable best efforts to obtain all material consents and approvals
of third parties that any of RMG III, H2B2, or its respective affiliates are required to obtain in order to consummate the Merger;
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each of RMG III and H2B2 to take certain actions to effect the Intended U.S. Tax Treatment and Intended Spanish Tax Treatment
(as such terms are defined in the Merger Agreement);
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each of RMG III and H2B2 to, prior to the Effective Time, take all such steps as may be required to cause any dispositions of
shares of H2B2 Common Stock or acquisitions of shares of RMG III Ordinary Shares (including, in each case, securities deliverable upon exercise, vesting or settlement of any derivative securities) resulting from the transactions
contemplated by the Merger Agreement by each individual who may become subject to the reporting requirements of Section 16(a) of the Exchange Act in connection with the transactions contemplated thereby to be exempt under Rule B-3
promulgated under the Exchange Act;
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each of RMG III and H2B2 to, and to cause its subsidiaries (in the case of H2B2) and its and their representatives to, prior to
the Closing, reasonably cooperate in a timely manner in connection with any financing arrangement the parties mutually agree to seek in connection with the transactions contemplated by the Merger Agreement;
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each of RMG III and H2B2 to take all such action within their power, subject to the Surviving Corporation Governing
Documents, so that immediately following the Effective Time, (i) the Surviving Corporation Board will consist of nine (9) directors, which will initially include (x) six (6) director nominees, each of whom will be independent
directors for the purposes of Nasdaq, to be mutually designated by H2B2 as set forth in the Merger Agreement, five (5) of whom will be designated by H2B2, and one (1) of whom will be designated by RMG, in each case by written notice
to the other party as soon as reasonably practicable following the date of the Merger Agreement and (y) three (3) director nominees to be designated by H2B2, (ii) the Chief Executive Officer of the Surviving Corporation will be
Mr. Anselmo Andrade Fernández de Mesa, and (iii) RMG III will be entitled, for a one year period following the Closing, to appoint one person as an observer to the Surviving Corporation Board; and
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prior to Closing, each of RMG III and H2B2 to (i) promptly notify the other party of, and keep such other party reasonably
informed of, the status of any litigation related to the Merger Agreement, any Ancillary Agreement or the transactions contemplated thereby brought, or, to the knowledge of a party, threatened in writing, against a party or the board of
directors of such party by any of such party’s stockholders or shareholders prior to the Closing and (ii) provide such other party the opportunity to participate in (subject to a customary joint defense agreement), but not control, the
defense of any such
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by written consent of H2B2 and RMG III;
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by H2B2 or RMG III if any governmental authority has enacted, issued, promulgated, enforced or entered any law or governmental
order which has become final and non-appealable and has the effect of making consummation of the transactions contemplated by the Merger Agreement and the Ancillary Agreements illegal, or otherwise enjoining, preventing or prohibiting
the consummation of the transactions contemplated by the Merger Agreement and the Ancillary Agreements (provided that such party did not cause such enactment);
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by H2B2 or RMG III if the Closing has not occurred on or prior to March 31, 2024, subject to certain automatic extensions,
for reasons not primarily due to the terminating party’s breach or violation of the terms of the Merger Agreement;
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by H2B2 if there has been a modification in recommendation of the RMG III Board with respect to any of the Proposals;
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by H2B2 if the RMG III Shareholder Approval has not been obtained by reason of the failure to obtain the required vote at a
meeting of RMG III shareholders;
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by H2B2 if (i) prior to completion of a Capital Raise Transaction, a Capital Raise Investor or group of Capital Raise Investors,
with legal, valid and binding commitments to fund in such Capital Raise Transaction represent in the aggregate at least the Minimum Investment Amount object to the Merger and the other transactions contemplated by the Merger Agreement
by delivering a written notice to the H2B2 Board by no later than fifteen days following execution of definitive agreements relating to the Capital Raise Transaction after which time no Capital Raise Investor will be entitled to object
to the Merger and the other transactions contemplated by the Merger Agreement; provided that, upon receipt of the written notice described above, H2B2 will be required to terminate the Merger Agreement on the tenth business day
following receipt of the written notice
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by H2B2 in the event of an uncured breach of any representation, warranty, covenant or agreement on the part of RMG III, except
if the breach is curable by RMG III through the exercise of its reasonable best efforts, then, for a period of up to thirty (30) days after receipt by RMG III of notice from H2B2 of such breach, but only as long as RMG III continues to
exercise such reasonable best efforts to cure such breach, such termination will not be effective, and such termination will be effective only if such breach is not cured within the thirty-day period;
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by RMG III in the event of an uncured breach of any representation, warranty, covenant or agreement on the part of H2B2, except
if the breach is curable by H2B2 through the exercise of its reasonable best efforts, then, for a period of up to thirty (30) days after receipt by H2B2 of notice from RMG III of such breach, but only as long as H2B2 continues to
exercise such reasonable best efforts to cure such breach, such termination will not be effective, and such termination will be effective only if such breach is not cured within the thirty-day period;
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by RMG III if the H2B2 Stockholder Approval has not been obtained; and
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by RMG III if an H2B2 Stockholder exercises any right or takes any action or fails to take any action required to satisfy the
conditions or any closing deliverables required to be delivered under the Merger Agreement that prevents consummation of the Merger and the other transactions contemplated by the Merger Agreement and the Ancillary Agreements.
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Base Purchase Price. The definition of Base Purchase Price was removed.
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Closing Date Purchase Price. The definition of Closing Date Purchase Price
was amended to a fixed purchase price of $400,000,000.
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AVR Option Amount. All references to the AVR Option Amount were removed from
the calculation of the Closing Date Purchase Price and Minimum Investment Amount.
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Minimum Investment Amount. The Minimum Investment Amount was reduced from
$40,000,000 to $30,000,000.
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10% Premium. The ten percent (10%) premium to the Closing Date Purchase Price
in the event that the Capital Raise Amount exceeded $15,000,000 was removed from the definition of Closing Date Purchase Price (which became a fixed purchase price of $400,000,000).
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Minimum Net Tangible Assets Condition. The condition precedent to closing of
the Merger that RMG III will have at least $5,000,001 of net tangible assets upon closing of the Merger (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) was removed.
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Conversion of RMG III Class B Ordinary Shares. The definition of Founder
Consideration Shares and other related sections of the Merger Agreement were amended to reflect the planned partial conversion by Sponsor of certain RMG III Class B Ordinary Shares into RMG III Class A Ordinary Shares prior to closing
of the Merger.
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Warrant Amendment. The covenant relating to the Warrant Amendment was amended
to clarify that RMG III will, following its execution, cause, in connection with the Closing, each of the then outstanding Public Warrants and Private Placement Warrants to represent the right to receive up to 0.075 shares of
Surviving Corporation Common Stock.
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Director Nominees. The covenant relating to the Surviving Corporation Board
was amended to provide that, immediately following the Effective Time, the Surviving Corporation Board will consist of nine (9) directors, which will initially include (i) six (6) director nominees, each of whom will be independent
directors for the purposes of Nasdaq, five (5) of whom will be designated by H2B2 and one (1) of whom will be designated by RMG III, in each case by written notice to the other party and (ii) three (3) director nominees to be
designated by H2B2.
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the Sponsor or RMG III’s officers or directors;
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financial institutions or financial services entities;
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broker-dealers;
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taxpayers that are subject to the mark-to-market accounting rules;
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tax-exempt entities;
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governments or agencies or instrumentalities thereof;
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insurance companies;
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regulated investment companies or real estate investment trusts;
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expatriates or former long-term residents of the United States;
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persons that actually or constructively own five percent or more of our voting shares or five percent or more of the total value
of all classes of our shares, except as specifically discussed under the caption heading “—Effects of Section 367 to U.S. Holders”;
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persons that acquired our securities pursuant to an exercise of employee share options or upon payout of a restricted stock
unit, in connection with employee share incentive plans or otherwise as compensation;
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persons that hold our securities as part of a straddle, constructive sale, hedging, conversion or other integrated or similar
transaction;
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U.S. Holders (as defined below) whose functional currency is not the U.S. dollar;
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controlled foreign corporations; and
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passive foreign investment companies.
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an individual citizen or resident of the United States,
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a corporation (or other entity that is treated as a corporation for U.S. federal income tax purposes) that is created or
organized (or treated as created or organized) in or under the laws of the United States or any state thereof or the District of Columbia,
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an estate whose income is subject to U.S. federal income tax regardless of its source, or
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a trust if (1) a U.S. court can exercise primary supervision over the administration of such trust and one or more U.S. persons
have the authority to control all substantial decisions of the trust or (2) it has a valid election in place to be treated as a U.S. person.
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(i)
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a statement that the Domestication is a Section 367(b) exchange (within the meaning of the applicable Treasury Regulations);
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(ii)
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a complete description of the Domestication;
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(iii)
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a description of any stock, securities or other consideration transferred or received in the Domestication;
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(iv)
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a statement describing the amounts required to be taken into account for U.S. federal income tax purposes;
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(v)
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a statement that the U.S. Holder is making the election that includes (A) a copy of the information that the U.S. Holder
received from RMG III establishing and substantiating the U.S. Holder’s all earnings and profits amount with respect to the U.S. Holder’s RMG III Class A Ordinary Shares and (B) a representation that the U.S. Holder has notified RMG III
(or the Surviving Corporation) that the U.S. Holder is making the election; and
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(vi)
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certain other information required to be furnished with the U.S. Holder’s tax return or otherwise furnished pursuant to the Code
or the Treasury Regulations.
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any gain recognized by the U.S. Holder on the sale or other disposition of its RMG III Class A Ordinary Shares or RMG III
Warrants; and
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any “excess distribution” made to the U.S. Holder (generally, any distributions to such U.S. Holder during a taxable year of the
U.S. Holder that are greater than 125% of the average annual distributions received by such U.S. Holder in respect of its ordinary shares during the three preceding taxable years of such U.S. Holder or, if shorter, such U.S. Holder’s
holding period for such ordinary shares).
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the U.S. Holder’s gain will be allocated ratably over the U.S. Holder’s holding period for such U.S. Holder’s RMG III Class A
Ordinary Shares or RMG III Warrants;
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the amount of gain allocated to the U.S. Holder’s taxable year in which the U.S. Holder recognized the gain, or to the period in
the U.S. Holder’s holding period before the first day of the first taxable year in which RMG III was a PFIC, will be taxed as ordinary income;
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the amount of gain allocated to other taxable years (or portions thereof) of the U.S. Holder and included in such U.S. Holder’s
holding period would be taxed at the highest tax rate in effect for that year and applicable to the U.S. Holder; and
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an additional tax equal to the interest charge generally applicable to underpayments of tax will be imposed on the U.S. Holder
in respect of the tax attributable to each such other taxable year of such U.S. Holder.
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such non-U.S. Holder is an individual who was present in the United States for 183 days or more in the taxable year of such
disposition and certain other requirements are met, in which case any gain realized will generally be subject to a flat 30% U.S. federal income tax;
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the gain is effectively connected with a trade or business of such non-U.S. Holder in the United States (and, if required by an
applicable income tax treaty, attributable to a U.S. permanent establishment or fixed base maintained by such non-U.S. Holder), in which case such gain will be subject to U.S. federal income tax, net of certain deductions, at the same
graduated individual or corporate rates applicable to U.S. Holders, and any such gain of a non-U.S. Holder that is a corporation may be subject to an additional “branch profits tax” at a rate of 30% (or such lower rate as may be
specified by an applicable income tax treaty); or
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the Surviving Corporation is or has been a U.S. real property holding corporation at any time during the shorter of the
five-year period preceding such disposition and such non-U.S. Holder’s holding period and either (A) Surviving Corporation’s Common Stock has ceased to be regularly traded on an established securities market or (B) such non-U.S. Holder
has owned or is deemed to have owned, at any time during the shorter of the five-year period preceding such disposition and such non-U.S. Holder’s holding period, more than 5% of outstanding Surviving Corporation Common Stock.
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Delaware
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Cayman Islands
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Stockholder/Shareholder Approval of Business Combinations
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| |
Generally, approval of routine corporate matters that are put to a
stockholder vote require the affirmative vote of the majority of shares present in person or represented by proxy at the meeting and entitled to vote on the subject matter. The Proposed Organizational Documents will not alter this
provision.
|
| |
Under the Cayman Islands Companies Act and the RMG III Governing Documents,
routine corporate matters may be approved by an ordinary resolution (being a resolution passed by a simple majority of the shareholders entitled to do so).
|
|
| |
|
| |
|
Appraisal Rights
|
| |
Generally, a stockholder of a publicly traded corporation does not have
appraisal rights in connection with a merger. The Proposed Organizational Documents will not provide for appraisal rights.
|
| |
Minority shareholders that dissent from a merger are entitled to be paid the
fair market value of their shares, which, if necessary, may ultimately be determined by the court.
|
|
| |
|
| |
|
Inspection of Books and Records
|
| |
Any stockholder may inspect the corporation’s books and records for a proper
purpose during the corporation’s usual hours of business.
|
| |
Shareholders generally do not have any rights to inspect or obtain copies of
the register of shareholders or other corporate records of a company.
|
|
| |
|
| |
|
Stockholder/Shareholder Lawsuits
|
| |
A stockholder may bring a derivative suit subject to procedural requirements
(including adopting Delaware as the exclusive forum as per the Organizational Documents Proposal D).
|
| |
The decision to institute proceedings on behalf of a company is generally
made by the company’s board of directors. A shareholder may be entitled to bring a derivative action on behalf of the company, but only in certain limited circumstances.
|
|
| |
Delaware
|
| |
Cayman Islands
|
Fiduciary Duties of Directors
|
| |
Directors must exercise a duty of care and duty of loyalty and good faith to
the company and its stockholders.
|
| |
A director owes fiduciary duties to a company, including to exercise loyalty,
honesty, and good faith to the company as a whole.
In addition to fiduciary duties, directors owe a duty of care, diligence and
skill.
Such duties are owed to the company as a whole but may be owed to creditors or
shareholders in certain limited circumstances.
|
|
| |
|
| |
|
Indemnification of Directors and Officers
|
| |
A corporation is generally permitted to indemnify its directors and officers
acting in good faith and in a manner reasonably believed to be in or not opposed to the best interests of the corporation. The Proposed Certificate of Incorporation will provide for indemnification of directors to the extent permissible
under Delaware law.
|
| |
A company generally may indemnify its directors or officers except with regard
to fraud or willful default.
|
|
| |
|
| |
|
Limited Liability of Directors
|
| |
Delaware law permits limiting or eliminating the monetary liability of a
director to a corporation or its stockholders, except with regard to breaches of duty of loyalty, intentional misconduct, unlawful repurchases or dividends or improper personal benefit. The Proposed Certificate of Incorporation will
limit a director’s liability to the extent permissible under Delaware law.
|
| |
Liability of directors may be limited, except with regard to their own fraud or
willful default.
|
|
| |
|
| |
|
Corporate Opportunity
|
| |
The Proposed Certificate of Incorporation will be silent on the issue of the
application of the doctrine of corporate opportunity.
|
| |
The RMG III Governing Documents provide that RMG III renounces its interest in
any corporate opportunity offered to any director or officer of RMG III which may be an opportunity for such director, on the one hand, or RMG III, on the other hand.
|
•
|
before such date, the board of directors of the corporation approved either the business combination or the transaction that
resulted in the stockholder becoming an interested stockholder;
|
•
|
upon completion of the transaction that resulted in the stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction began, excluding for purposes of determining the voting stock outstanding, but not the outstanding voting stock owned by the
interested stockholder, those shares owned (i) by persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to
the plan will be tendered in a tender or exchange offer; or
|
•
|
on or after such date, the business combination is approved by the board of directors and authorized at an annual or special
meeting of the stockholders, and not by written consent, by the affirmative vote of at least two-thirds (66 and 2∕3%) of the outstanding voting stock that is not owned by the interested stockholder.
|
•
|
any merger or consolidation involving the corporation and the interested stockholder;
|
•
|
any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested
stockholder;
|
•
|
subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the
corporation to the interested stockholder;
|
•
|
any transaction involving the corporation that has the effect of increasing the proportionate share of the stock or any class or
series of the corporation beneficially owned by the interested stockholder; or
|
•
|
the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits
by or through the corporation.
|
•
|
permit the Surviving Corporation Board to issue up to shares of preferred stock, with any rights, preferences and
privileges as they may designate, including the right to approve an acquisition or other change of control;
|
•
|
provide that the authorized number of directors may be changed only by resolution of the Surviving Corporation Board;
|
•
|
provide that, subject to the rights of any series of preferred stock to elect directors, directors may only be removed for
cause, which removal may be effected, subject to any limitation imposed by law, by the holders of at least two-thirds (66 and 2∕3%) of the voting power of all of the then outstanding shares of voting stock of the corporation entitled to
vote at an election of directors.
|
•
|
provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the
affirmative vote of the holders of a majority of directors then in office, even if less than a quorum, or by a sole remaining director (other than any directors elected by the separate vote of one or more outstanding series of preferred
stock), and shall not be filled by the stockholders;
|
•
|
require that any action to be taken by the Surviving Corporation stockholders must be effected at a duly called annual or
special meeting of stockholders and not be taken by written consent or electronic transmission;
|
•
|
provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election
as directors at a meeting of stockholders must provide advance notice in writing, and also specify requirements as to the form and content of a stockholder’s notice;
|
•
|
provide that special meetings of our stockholders may be called only by the chairperson of the Surviving Corporation Board, its
chief executive officer, its president or by its board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors; and
|
•
|
not provide for cumulative voting rights, therefore allowing the holders of a majority of the shares of common stock entitled to
vote in any election of directors to elect all of the directors standing for election, if they should so choose.
|
•
|
any breach of the director’s duty of loyalty to the corporation or its stockholders;
|
•
|
any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;
|
•
|
unlawful payments of dividends or unlawful stock repurchases or redemptions; or
|
•
|
any transaction from which the director derived an improper personal benefit.
|
•
|
1% of the total number of shares of Surviving Corporation Common Stock then outstanding; or
|
•
|
the average weekly reported trading volume of Surviving Corporation Common Stock during the four calendar weeks preceding the
filing of a notice on Form 144 with respect to the sale.
|
•
|
the issuer of the securities that was formerly a shell company has ceased to be a shell company;
|
•
|
the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act;
|
•
|
the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the
preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Form 8-K reports; and
|
•
|
at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its
status as an entity that is not a shell company.
|
•
|
1% of the total number of shares of the Surviving Corporation Common Stock then outstanding; or
|
•
|
the average weekly reported trading volume of Surviving Corporation Common Stock during the four calendar weeks preceding the
filing of a notice on Form 144 with respect to the sale.
|
•
|
the issuer of the securities that was formerly a shell company has ceased to be a shell company;
|
•
|
the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act;
|
•
|
the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the
preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Form 8-K reports; and
|
•
|
at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its
status as an entity that is not a shell company.
|
•
|
not earlier than the 90th day; and
|
•
|
not later than the 120th day,
|
|
| |
Page
No.
|
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| |
|
| |
Page
No.
|
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| |
|
| |
September 30, 2023
|
| |
December 31, 2022
|
Assets
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$11,534,785
|
| |
$5,044,949
|
Accounts receivable, net of allowance for doubtful
accounts of $100,868 and $47,758, respectively
|
| |
2,392,859
|
| |
2,099,177
|
Inventory
|
| |
2,951,413
|
| |
6,175,000
|
Prepaid expenses and other current assets
|
| |
2,029,972
|
| |
1,281,268
|
Grants receivable
|
| |
1,259,393
|
| |
742,837
|
Contract assets
|
| |
266,034
|
| |
2,197,730
|
Total current assets
|
| |
20,434,456
|
| |
17,540,961
|
Property, plant, and equipment, net
|
| |
12,071,988
|
| |
5,148,017
|
Operating lease – right of use asset, net
|
| |
1,978,266
|
| |
2,235,854
|
Intangible assets, net
|
| |
154,019
|
| |
87,301
|
Equity method investments
|
| |
142,530
|
| |
—
|
Other assets
|
| |
1,764,838
|
| |
173,055
|
Total assets
|
| |
$36,546,097
|
| |
$25,185,188
|
Liabilities and Stockholders’ Equity
|
| |
|
| |
|
Current liabilities:
|
| |
|
| |
|
Accounts payable
|
| |
$14,153,960
|
| |
$8,484,808
|
Current notes payable
|
| |
1,500,000
|
| |
—
|
Current maturities of long-term debt
|
| |
21,458
|
| |
10,663
|
Current maturities of operating lease liabilities
|
| |
166,926
|
| |
230,645
|
Contract liabilities
|
| |
3,220,563
|
| |
1,735,716
|
Current provisions
|
| |
85,864
|
| |
44,378
|
Other current liabilities
|
| |
35,596
|
| |
21,179
|
Total current liabilities
|
| |
19,184,367
|
| |
10,527,389
|
Unearned grants
|
| |
3,531,326
|
| |
2,053,159
|
Long-term operating lease liabilities
|
| |
1,900,146
|
| |
2,111,530
|
Income taxes payable
|
| |
1,859,225
|
| |
1,787,968
|
Long-term debt, less current maturities
|
| |
16,559,531
|
| |
13,796
|
Other liabilities
|
| |
8,470,231
|
| |
208,912
|
Total liabilities
|
| |
51,504,826
|
| |
16,702,754
|
Commitments and contingent liabilities (Note 13)
|
| |
|
| |
—
|
Stockholders’ (deficit) equity:
|
| |
|
| |
|
Common stock, $0.00001 par value per share; 10,346,314
shares authorized, 9,515,008 and 9,708,341 issued and outstanding at September 30, 2023 and December 31, 2022, respectively
|
| |
103
|
| |
103
|
Treasury stock, at cost, 831,306 shares at
September 30, 2023 and 637,973 shares at December 31, 2022
|
| |
(9)
|
| |
(7)
|
Additional paid-in capital
|
| |
1,341,102
|
| |
16,851,455
|
Accumulated other comprehensive loss
|
| |
(3,842)
|
| |
(3,842)
|
Accumulated deficit
|
| |
(16,296,083)
|
| |
(8,365,275)
|
Total stockholders’ (deficit) equity
|
| |
(14,958,729)
|
| |
8,482,434
|
Total liabilities and (deficit) equity
|
| |
$36,546,097
|
| |
$25,185,188
|
|
| |
Three Months Ended September 30,
|
| |
Nine Months Ended September 30,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
Product sales
|
| |
$765,272
|
| |
$408,999
|
| |
$7,932,684
|
| |
$1,646,000
|
Cost of sales
|
| |
706,042
|
| |
372,924
|
| |
7,924,701
|
| |
1,375,548
|
Gross profit
|
| |
59,230
|
| |
36,075
|
| |
7,983
|
| |
270,452
|
|
| |
|
| |
|
| |
|
| |
|
Operating expenses:
|
| |
|
| |
|
| |
|
| |
|
Research and development
|
| |
723,436
|
| |
251,048
|
| |
1,894,644
|
| |
908,545
|
Selling, general and administrative
|
| |
2,883,447
|
| |
835,041
|
| |
7,403,238
|
| |
2,383,248
|
Depreciation and amortization of long-lived assets
|
| |
51,700
|
| |
38,576
|
| |
134,151
|
| |
49,332
|
Income from grants
|
| |
1,004,131
|
| |
113,748
|
| |
1,709,387
|
| |
530,903
|
Losses from our unconsolidated investments
|
| |
(124,100)
|
| |
—
|
| |
(131,132)
|
| |
—
|
Loss from operations
|
| |
(2,719,322)
|
| |
(974,842)
|
| |
(7,845,795)
|
| |
(2,539,770)
|
|
| |
|
| |
|
| |
|
| |
|
Other income (expense):
|
| |
|
| |
|
| |
|
| |
|
Other income
|
| |
—
|
| |
—
|
| |
326,203
|
| |
411,878
|
Interest and financial income (expense), net
|
| |
(159,424)
|
| |
(495,677)
|
| |
(341,332)
|
| |
(1,252,200)
|
Total other income (expense), net
|
| |
(159,424)
|
| |
(495,677)
|
| |
(15,129)
|
| |
(840,322)
|
Loss before income tax expense
|
| |
(2,878,746)
|
| |
(1,470,519)
|
| |
(7,860,924)
|
| |
(3,380,092)
|
Income tax expense
|
| |
22,764
|
| |
16,403
|
| |
69,884
|
| |
39,643
|
Net loss
|
| |
(2,901,510)
|
| |
(1,486,922)
|
| |
(7,930,808)
|
| |
(3,419,735)
|
|
| |
|
| |
|
| |
|
| |
|
Net loss per share:
|
| |
|
| |
|
| |
|
| |
|
Net loss per share – basic
|
| |
$(0.30)
|
| |
$(0.15)
|
| |
$(0.82)
|
| |
$(0.35)
|
Net loss per share – diluted
|
| |
$(0.30)
|
| |
$(0.15)
|
| |
$(0.82)
|
| |
$(0.35)
|
|
| |
|
| |
|
| |
|
| |
|
Weighted average shares outstanding – basic
|
| |
9,515,008
|
| |
9,729,856
|
| |
9,621,235
|
| |
9,732,972
|
Weighted average shares outstanding – diluted
|
| |
9,515,008
|
| |
9,729,856
|
| |
9,621,235
|
| |
9,732,972
|
|
| |
Common Stock
|
| |
Additional Paid-in
Capital
|
| |
Accumulated
Other
Comprehensive
Loss
|
| |
Retained Earnings
(Accumulated
Deficit)
|
| |
Treasury stock, at cost
|
| |
Total H2B2 Electrolysis
Technologies, Inc.
Stockholders
|
| |
Noncontrolling
Interest
|
| |
Total
(Deficit)
Equity
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| |||||||||||||||||
July 1, 2023
|
| |
10,346,314
|
| |
$103
|
| |
$1,320,221
|
| |
$(3,842)
|
| |
$(13,394,573)
|
| |
(831,306)
|
| |
$(9)
|
| |
$(12,078,100)
|
| |
$—
|
| |
$(12,078,100)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(2,901,510)
|
| |
—
|
| |
—
|
| |
(2,901,510)
|
| |
—
|
| |
(2,901,510)
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
20,881
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
20,881
|
| |
—
|
| |
20,881
|
September 30, 2023
|
| |
10,346,314
|
| |
$103
|
| |
$1,341,102
|
| |
$(3,842)
|
| |
$(16,296,083)
|
| |
(831,306)
|
| |
$(9)
|
| |
$(14,958,729)
|
| |
$—
|
| |
$(14,958,729)
|
July 1, 2022
|
| |
10,346,314
|
| |
$103
|
| |
$16,855,005
|
| |
$(3,842)
|
| |
$(6,001,629)
|
| |
(611,929)
|
| |
$(6)
|
| |
$10,849,631
|
| |
$—
|
| |
$10,849,631
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(1,486,922)
|
| |
—
|
| |
—
|
| |
(1,486,922)
|
| |
—
|
| |
(1,486,922)
|
Repurchase of common stock
|
| |
—
|
| |
—
|
| |
(4,170)
|
| |
—
|
| |
—
|
| |
(26,044)
|
| |
(1)
|
| |
(4,171)
|
| |
—
|
| |
(4,171)
|
September 30, 2022
|
| |
10,346,314
|
| |
$103
|
| |
$16,850,835
|
| |
$(3,842)
|
| |
$(7,488,551)
|
| |
(637,973)
|
| |
$(7)
|
| |
$9,358,538
|
| |
$—
|
| |
$9,358,538
|
|
| |
Common Stock
|
| |
|
| |
|
| |
|
| |
Treasury stock, at cost
|
| |
|
| |
|
| |
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Additional Paid-in
Capital
|
| |
Accumulated
Other
Comprehensive
Loss
|
| |
Retained Earnings
(Accumulated
Deficit)
|
| |
Shares
|
| |
Amount
|
| |
Total H2B2 Electrolysis
Technologies, Inc.
Stockholders
|
| |
Noncontrolling
Interest
|
| |
Total
(Deficit)
Equity
|
January 1, 2023
|
| |
10,346,314
|
| |
$103
|
| |
$16,851,455
|
| |
$(3,842)
|
| |
$(8,365,275)
|
| |
(637,973)
|
| |
$(7)
|
| |
$8,482,434
|
| |
$—
|
| |
$8,482,434
|
Repurchase of common stock
|
| |
—
|
| |
—
|
| |
(15,536,748)
|
| |
—
|
| |
—
|
| |
(193,333)
|
| |
(2)
|
| |
(15,536,750)
|
| |
—
|
| |
(15,536,750)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(7,930,808)
|
| |
—
|
| |
—
|
| |
(7,930,808)
|
| |
—
|
| |
(7,930,808)
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
26,395
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
26,395
|
| |
—
|
| |
26,395
|
September 30, 2023
|
| |
10,346,314
|
| |
$103
|
| |
$1,341,102
|
| |
$(3,842)
|
| |
$(16,296,083)
|
| |
(831,306)
|
| |
$(9)
|
| |
$(14,958,729)
|
| |
$—
|
| |
$(14,958,729)
|
January 1, 2022
|
| |
10,346,314
|
| |
$103
|
| |
$16,835,962
|
| |
$(3,842)
|
| |
$(4,068,816)
|
| |
(610,000)
|
| |
$(6)
|
| |
$12,763,401
|
| |
$75,761
|
| |
$12,839,162
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(3,419,735)
|
| |
—
|
| |
—
|
| |
(3,419,735)
|
| |
—
|
| |
(3,419,735)
|
Repurchase of common stock
|
| |
—
|
| |
—
|
| |
(11,888)
|
| |
—
|
| |
—
|
| |
(27,973)
|
| |
(1)
|
| |
(11,889)
|
| |
—
|
| |
(11,889)
|
Purchase of noncontrolling interest
|
| |
—
|
| |
—
|
| |
26,761
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
26,761
|
| |
(75,761)
|
| |
(49,000)
|
September 30, 2022
|
| |
10,346,314
|
| |
$103
|
| |
$16,850,835
|
| |
$(3,842)
|
| |
$(7,488,551)
|
| |
(637,973)
|
| |
$(7)
|
| |
$9,358,538
|
| |
$—
|
| |
$9,358,538
|
|
| |
September 30, 2023
|
| |
September 30, 2022
|
Operating Activities
|
| |
|
| |
|
Net loss
|
| |
$(7,930,808)
|
| |
$(3,419,735)
|
Adjustments to reconcile net loss to net cash provided
by (used in) operating activities:
|
| |
|
| |
|
Paid in kind interest
|
| |
546,650
|
| |
—
|
Depreciation and amortization of long-lived assets
|
| |
134,151
|
| |
49,332
|
Accrued employee benefits and other provisions
|
| |
15,513
|
| |
115,789
|
Noncash lease expense
|
| |
99,152
|
| |
39,274
|
Stock-based compensation
|
| |
26,395
|
| |
—
|
Foreign currency (gain) loss
|
| |
(452,368)
|
| |
1,224,122
|
Losses from our unconsolidated investments
|
| |
131,132
|
| |
—
|
Changes in operating assets and liabilities
|
| |
|
| |
|
Accounts receivable
|
| |
(293,682)
|
| |
330,668
|
Inventory
|
| |
3,223,587
|
| |
986
|
Prepaid expenses and other current assets
|
| |
(1,171,257)
|
| |
(487,711)
|
Grants receivable
|
| |
(599,524)
|
| |
(428,744)
|
Contract assets
|
| |
1,931,696
|
| |
(1,199,603)
|
Accounts payable
|
| |
4,313,936
|
| |
617,179
|
Contract liabilities
|
| |
1,484,847
|
| |
93,831
|
Lease liabilities
|
| |
(116,667)
|
| |
(7,583)
|
Income taxes payable
|
| |
85,674
|
| |
39,644
|
Net cash provided by (used in) operating activities
|
| |
1,428,427
|
| |
(3,032,551)
|
Investing Activities
|
| |
|
| |
|
Payments for assets under construction
|
| |
(5,107,490)
|
| |
(2,744,195)
|
Purchase of intangible assets
|
| |
(85,128)
|
| |
—
|
Purchase of property, plant, and equipment
|
| |
(154,423)
|
| |
(354,185)
|
Proceeds from grants for assets under construction
|
| |
1,561,135
|
| |
1,312,062
|
Advance to equity method investees
|
| |
(273,662)
|
| |
—
|
Proceeds from deposits and guarantees
|
| |
—
|
| |
1,218,231
|
Other assets
|
| |
(1,591,783)
|
| |
159,156
|
Net cash used in investing activities
|
| |
(5,651,351)
|
| |
(408,931)
|
Financing Activities
|
| |
|
| |
|
Proceed from issuance long-term borrowing
|
| |
15,536,750
|
| |
—
|
Debt issue cost
|
| |
(465,015)
|
| |
—
|
Proceeds from working capital facility
|
| |
1,145,712
|
| |
—
|
Proceeds from other long-term liability
|
| |
8,405,330
|
| |
—
|
Proceeds from issuance mandatory convertible notes
|
| |
1,500,000
|
| |
—
|
Payments of long-term debt, net
|
| |
(2,451)
|
| |
(16,249)
|
Acquisition of treasury shares
|
| |
(15,536,750)
|
| |
(11,889)
|
Net cash provided by (used in) financing activities
|
| |
10,583,576
|
| |
(28,138)
|
Effect of exchange rate changes on cash and cash
equivalents
|
| |
129,184
|
| |
(1,224,121)
|
Increase (decrease) in cash and cash equivalents
|
| |
6,489,836
|
| |
(4,693,741)
|
Cash and cash equivalents beginning of period
|
| |
5,044,949
|
| |
11,545,081
|
Cash and cash equivalents end of period
|
| |
$11,534,785
|
| |
$6,851,340
|
|
| |
|
| |
|
Supplemental cash flow information:
|
| |
|
| |
|
Purchase of property and equipment by incurring current liabilities
|
| |
$1,623,281
|
| |
$277,085
|
Acquisition of non-controlling interest
|
| |
$—
|
| |
$49,000
|
Noncash recognition of lease modification
|
| |
$(212,834)
|
| |
$—
|
1.
|
Nature of Operations
|
2.
|
Summary of Significant Accounting Policies and New Accounting Pronouncements
|
|
| |
September 30, 2023
|
| |
December 31, 2022
|
Level 3
|
| |
|
| |
|
Current note payable
|
| |
$1,500,000
|
| |
$—
|
Total
|
| |
$1,500,000
|
| |
$—
|
|
| |
September 30, 2023
|
| |
December 31, 2022
|
Accounts receivable
|
| |
$2,392,859
|
| |
$2,099,177
|
Contract assets
|
| |
266,034
|
| |
2,197,730
|
Contract liabilities
|
| |
(3,220,563)
|
| |
(1,735,716)
|
Net contract assets/liabilities
|
| |
$(561,670)
|
| |
$2,561,191
|
Contract assets
|
| |
September 30, 2023
|
Transferred to receivables
|
| |
$(2,197,730)
|
Revenue recognized and not billed
|
| |
266,034
|
Net change in contract assets
|
| |
$(1,931,696)
|
Contract liabilities
|
| |
September 30, 2023
|
Advanced billings
|
| |
$3,220,563
|
Revenue recognized during the period
|
| |
(1,735,716)
|
Net change in contract liabilities
|
| |
$1,484,847
|
3.
|
Property, Plant and Equipment
|
|
| |
September 30, 2023
|
| |
December 31, 2022
|
Assets under construction
|
| |
$11,737,926
|
| |
$4,852,667
|
Machinery and equipment
|
| |
360,338
|
| |
357,142
|
Computer hardware
|
| |
166,739
|
| |
83,919
|
Furniture and other fixtures
|
| |
70,445
|
| |
2,038
|
Property, plant, and equipment
|
| |
12,335,448
|
| |
5,295,766
|
Less accumulated depreciation
|
| |
(263,460)
|
| |
(147,749)
|
Property, plant, and equipment, net
|
| |
$12,071,988
|
| |
$5,148,017
|
4.
|
Prepaid Expenses and Other Current Assets
|
|
| |
September 30, 2023
|
| |
December 31, 2022
|
Prepayments to suppliers
|
| |
$1,397,363
|
| |
$899,161
|
VAT receivables
|
| |
286,284
|
| |
371,315
|
Other current assets
|
| |
346,325
|
| |
10,792
|
Total
|
| |
$2,029,972
|
| |
$1,281,268
|
5.
|
Accounts Payable and other payables
|
|
| |
September 30, 2023
|
| |
December 31, 2022
|
Accrued employee benefits
|
| |
$388,437
|
| |
$221,827
|
Accounts payable
|
| |
13,405,545
|
| |
8,019,474
|
Other taxes
|
| |
359,978
|
| |
243,507
|
Total
|
| |
$14,153,960
|
| |
$8,484,808
|
6.
|
Current notes payable
|
7.
|
Government grants
|
|
| |
Unearned grants
|
December 31, 2022
|
| |
$2,053,159
|
Additions
|
| |
1,478,167
|
Disposals
|
| |
—
|
Recognized in income
|
| |
—
|
September 30, 2023
|
| |
$3,531,326
|
|
| |
September 30, 2023
|
| |
December 31, 2022
|
Grants in Spain
|
| |
$1,184,914
|
| |
$585,390
|
Grants in U.S.
|
| |
74,479
|
| |
157,447
|
Grant receivable
|
| |
$1,259,393
|
| |
$742,837
|
8.
|
Equity investments
|
|
| |
September 30, 2023
|
Equity method investment
|
| |
$273,662
|
Loss from our unconsolidated investments
|
| |
(131,132)
|
|
| |
$142,530
|
9.
|
Income Taxes
|
10.
|
Stock-Based Compensation
|
11.
|
Leases
|
|
| |
Operating Leases
|
2023
|
| |
$92,026
|
2024
|
| |
350,203
|
2025
|
| |
349,739
|
2026
|
| |
350,806
|
2027
|
| |
335,723
|
Thereafter
|
| |
2,278,624
|
Total future minimum lease payments
|
| |
3,757,121
|
Less imputed lease interest
|
| |
(1,690,049)
|
Total lease liabilities
|
| |
$2,067,072
|
|
| |
Nine months ended
September 30, 2023
|
| |
Nine months ended
September 30, 2022
|
Cash payments
|
| |
$203,909
|
| |
$81,000
|
Weighted average remaining lease term (years)
|
| |
14.00
|
| |
19.98
|
Weighted average discount rate
|
| |
9.08%
|
| |
7.00%
|
Noncash lease amount
|
| |
$99,152
|
| |
$39,274
|
12.
|
Long-term Debt
|
13.
|
Commitments and Contingencies
|
14.
|
Loss per Share
|
15.
|
Segment Reporting
|
|
| |
Product sales
|
| |
Product sales
|
| |
Long-lived assets
|
|||||||||
|
| |
Three Months Ended
|
| |
Nine Months Ended
|
| |
Nine Months Ended
|
|||||||||
Region
|
| |
September 30,
2023
|
| |
September 30,
2022
|
| |
September 30,
2023
|
| |
September 30,
2022
|
| |
September 30,
2023
|
| |
December 31,
2022
|
N. America
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$—
|
| |
$13,076,904
|
| |
$6,361,086
|
LATAM(1)
|
| |
87,288
|
| |
395,490
|
| |
485,436
|
| |
1,603,674
|
| |
—
|
| |
—
|
Europe
|
| |
677,984
|
| |
13,509
|
| |
7,447,248
|
| |
42,326
|
| |
1,127,369
|
| |
1,110,086
|
Total
|
| |
$765,272
|
| |
$408,999
|
| |
$7,932,684
|
| |
$1,646,000
|
| |
$14,204,273
|
| |
$7,471,172
|
(1)
|
LATAM comprises Central America, South America, and Mexico.
|
16.
|
Subsequent Events
|
•
|
Base Purchase Price. Removal of the definition of Base Purchase Price.
|
•
|
Closing Date Purchase Price. Amendment to the definition of Closing Date
Purchase Price to a fixed purchase price of $400,000,000.
|
•
|
AVR Option Amount. Removal of the AVR Option Amount from the calculation of
the Closing Date Purchase Price and Minimum Investment Amount as a result of the agreement between the Chairman of the Board of Directors, Mr. Vázquez, and the Company to delay the exercise of Mr. Vázquez’s option to acquire up to
68,966 shares of Company Common Stock, to after closing of the Merger.
|
•
|
Minimum Investment Amount. Reduction of the Minimum Investment Amount from
$40,000,000 to $30,000,000.
|
•
|
10% Premium. Removal of the ten percent (10%) premium to the Closing Date
Purchase Price in the event that the Capital Raise Amount exceeded $15,000,000 from the definition of Closing Date Purchase Price.
|
•
|
Minimum Net Tangible Assets Condition. Removal of the condition precedent to
closing of the Merger that RMG III will have at least $5,000,001 of net tangible assets upon closing of the Merger (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act).
|
•
|
Conversion of RMG III Class B Ordinary Shares. Amendment to the definition
of Founder Consideration Shares and other related sections of the Merger Agreement to reflect the planned partial conversion by Sponsor of certain RMG III Class B Ordinary Shares into RMG III Class A Ordinary Shares prior to closing
of the Merger.
|
•
|
Warrant Amendment. Amendment to the covenant relating to the Warrant
Amendment to clarify that RMG III will, following its execution, cause, in connection with the Closing, each of the then outstanding Public Warrants and Private Placement Warrants to represent the right to receive up to 0.075 shares
of Surviving Corporation Common Stock.
|
•
|
Director Nominees. Amendment to the covenant relating to the composition of
the Surviving Corporation Board to provide that, immediately following the Effective Time, the Surviving Corporation Board will consist of nine (9) directors, which will initially include (i) six (6) director nominees, each of whom
will be independent directors for the purposes of Nasdaq, five (5) of whom to be designated by the Company and one (1) of whom to be designated by RMG III, and (ii) three (3) director nominees to be designated by the Company.
|
|
| |
2022
|
| |
2021
|
Assets
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$5,044,949
|
| |
$11,545,081
|
Accounts receivable, net of allowance for doubtful
accounts of $47,758 and $0, respectively
|
| |
2,099,177
|
| |
382,698
|
Inventory
|
| |
6,175,000
|
| |
986
|
Prepaid expenses and other current assets
|
| |
1,281,268
|
| |
2,100,391
|
Grants receivable
|
| |
742,837
|
| |
498,308
|
Contract assets
|
| |
2,197,730
|
| |
212,410
|
Total current assets
|
| |
17,540,961
|
| |
14,739,874
|
Property, plant, and equipment, net
|
| |
5,148,017
|
| |
858,149
|
Operating lease – right of use asset, net
|
| |
2,235,854
|
| |
1,553,135
|
Intangible assets, net
|
| |
87,301
|
| |
85,503
|
Other assets
|
| |
173,055
|
| |
210,105
|
Total assets
|
| |
$25,185,188
|
| |
$17,446,766
|
Liabilities and Equity
|
| |
|
| |
|
Current liabilities:
|
| |
|
| |
|
Accounts payable and accrued expenses
|
| |
$8,484,808
|
| |
$593,146
|
Current maturities of long-term debt
|
| |
10,663
|
| |
1,946
|
Current maturities of operating lease liabilities
|
| |
230,645
|
| |
106,773
|
Contract liabilities
|
| |
1,735,716
|
| |
257,061
|
Current provisions
|
| |
44,378
|
| |
17,348
|
Other current liabilities
|
| |
21,179
|
| |
3,792
|
Total current liabilities
|
| |
10,527,389
|
| |
980,066
|
Unearned grants
|
| |
2,053,159
|
| |
271,091
|
Long-term operating lease liabilities
|
| |
2,111,530
|
| |
1,489,869
|
Income taxes payable
|
| |
1,787,968
|
| |
1,729,227
|
Long-term debt, less current maturities
|
| |
13,796
|
| |
17,743
|
Other liabilities
|
| |
208,912
|
| |
119,608
|
Total liabilities
|
| |
16,702,754
|
| |
4,607,604
|
Commitments and contingencies (Note 11)
|
| |
—
|
| |
—
|
Equity
|
| |
|
| |
|
H2B2 Electrolysis Technologies, Inc. Stockholders’ equity:
|
| |
|
| |
|
Common stock, $0.00001 par value per share; 10,346,314
shares authorized, issued 9,708,341 and 9,736,314 outstanding at December 31, 2022 and 2021, respectively
|
| |
103
|
| |
103
|
Treasury stock, at cost, 637,973 and 610,000 shares at
December 31, 2022 and 2021, respectively
|
| |
(7)
|
| |
(6)
|
Additional paid-in capital
|
| |
16,851,455
|
| |
16,835,962
|
Accumulated other comprehensive loss
|
| |
(3,842)
|
| |
(3,842)
|
Accumulated deficit
|
| |
(8,365,275)
|
| |
(4,068,816)
|
Total H2B2 Electrolysis Technologies, Inc. Stockholders’
equity
|
| |
8,482,434
|
| |
12,763,401
|
Noncontrolling interests
|
| |
—
|
| |
75,761
|
Total equity
|
| |
8,482,434
|
| |
12,839,162
|
Total liabilities and equity
|
| |
$25,185,188
|
| |
$17,446,766
|
|
| |
2022
|
| |
2021
|
Product sales
|
| |
$3,491,673
|
| |
$961,607
|
Cost of sales
|
| |
3,042,412
|
| |
815,956
|
Gross profit
|
| |
449,261
|
| |
145,651
|
|
| |
|
| |
|
Operating expenses:
|
| |
|
| |
|
Research and development
|
| |
1,333,961
|
| |
588,281
|
Selling, general and administrative
|
| |
3,904,132
|
| |
3,220,510
|
Depreciation of long-lived assets
|
| |
88,257
|
| |
24,178
|
|
| |
|
| |
|
Income from grants
|
| |
801,991
|
| |
242,170
|
|
| |
|
| |
|
Loss from operations
|
| |
(4,075,098)
|
| |
(3,445,148)
|
|
| |
|
| |
|
Other income (expense):
|
| |
|
| |
|
Other income
|
| |
411,879
|
| |
105,979
|
Interest and other expense, net
|
| |
(557,112)
|
| |
(757,444)
|
Total other expense, net
|
| |
(145,233)
|
| |
(651,465)
|
|
| |
|
| |
|
Loss before tax expense
|
| |
(4,220,331)
|
| |
(4,096,613)
|
|
| |
|
| |
|
Income tax expense
|
| |
76,128
|
| |
34,391
|
|
| |
|
| |
|
Net loss
|
| |
(4,296,459)
|
| |
(4,131,004)
|
Less: Net loss attributable to noncontrolling interests
|
| |
—
|
| |
(253)
|
Net loss attributable to Stockholders’
|
| |
$(4,296,459)
|
| |
$(4,130,751)
|
|
| |
|
| |
|
Net loss per share:
|
| |
|
| |
|
Net loss per share – basic
|
| |
$(0.44)
|
| |
$(0.50)
|
Net loss per share – diluted
|
| |
$(0.44)
|
| |
$(0.50)
|
|
| |
|
| |
|
Weighted average shares outstanding – basic
|
| |
9,727,939
|
| |
8,321,904
|
Weighted average shares outstanding – diluted
|
| |
9,727,939
|
| |
8,321,904
|
|
| |
Common Stock
|
| |
Additional
Paid-in
Capital
|
| |
Accumulated
Other
Comprehensive
Loss
|
| |
Retained
Earnings
(Accumulated
Deficit)
|
| |
Treasury stock,
at cost
|
| |
Total H2B2
Electrolysis
Technologies, Inc.
Stockholders’
|
| |
Noncontrolling
Interest
|
| |
Total
Equity
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| |||||||||||||||||
January 1, 2021
|
| |
8,241,050
|
| |
$82
|
| |
$7,257,573
|
| |
$(3,842)
|
| |
$61,936
|
| |
(651,929)
|
| |
$(7)
|
| |
$7,315,742
|
| |
$76,017
|
| |
$7,391,759
|
Net (loss)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(4,130,751)
|
| |
—
|
| |
—
|
| |
(4,130,751)
|
| |
(253)
|
| |
(4,131,004)
|
Issuance of common stock
|
| |
2,105,264
|
| |
21
|
| |
9,579,480
|
| |
—
|
| |
—
|
| |
118,012
|
| |
—
|
| |
9,579,501
|
| |
—
|
| |
9,579,501
|
Repurchase of common stock
|
| |
—
|
| |
—
|
| |
(1,091)
|
| |
—
|
| |
(1)
|
| |
(76,083)
|
| |
1
|
| |
(1,091)
|
| |
(3)
|
| |
(1,094)
|
December 31, 2021
|
| |
10,346,314
|
| |
103
|
| |
16,835,962
|
| |
(3,842)
|
| |
(4,068,816)
|
| |
(610,000)
|
| |
(6)
|
| |
12,763,401
|
| |
75,761
|
| |
12,839,162
|
Net (loss)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(4,296,459)
|
| |
—
|
| |
—
|
| |
(4,296,459)
|
| |
—
|
| |
(4,296,459)
|
Repurchase of common stock
|
| |
—
|
| |
—
|
| |
(11,887)
|
| |
—
|
| |
—
|
| |
(27,973)
|
| |
(1)
|
| |
(11,888)
|
| |
—
|
| |
(11,888)
|
Purchase of noncontrolling interest
|
| |
—
|
| |
—
|
| |
26,761
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
26,761
|
| |
(75,761)
|
| |
(49,000)
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
619
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
619
|
| |
—
|
| |
619
|
December 31, 2022
|
| |
10,346,314
|
| |
$103
|
| |
$16,851,455
|
| |
$(3,842)
|
| |
$(8,365,275)
|
| |
(637,973)
|
| |
$(7)
|
| |
$8,482,434
|
| |
$—
|
| |
$8,482,434
|
|
| |
2022
|
| |
2021
|
Operating Activities
|
| |
|
| |
|
Net loss
|
| |
$(4,296,459)
|
| |
$(4,131,004)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
| |
|
| |
|
Depreciation of long-lived assets
|
| |
88,256
|
| |
24,178
|
Accrued employee benefits and other provisions
|
| |
129,445
|
| |
189,620
|
Noncash lease expense
|
| |
55,646
|
| |
—
|
Stock-based compensation
|
| |
619
|
| |
—
|
Foreign currency loss
|
| |
526,839
|
| |
737,442
|
Loss on disposal of assets
|
| |
—
|
| |
65,199
|
Changes in operating assets and liabilities
|
| |
|
| |
|
Accounts receivable
|
| |
(1,716,479)
|
| |
(629,486)
|
Inventory
|
| |
(6,174,014)
|
| |
—
|
Prepaid expenses and other current assets
|
| |
(436,610)
|
| |
—
|
Grants receivable
|
| |
(358,173)
|
| |
—
|
Contract assets
|
| |
(1,985,320)
|
| |
156,581
|
Accounts payable
|
| |
7,891,662
|
| |
(134,651)
|
Contract liabilities
|
| |
1,478,655
|
| |
236,101
|
Lease liabilities
|
| |
7,168
|
| |
—
|
Income taxes payable
|
| |
76,128
|
| |
(1,925,000)
|
Net cash used in operating activities
|
| |
(4,712,637)
|
| |
(5,411,020)
|
Investing Activities
|
| |
|
| |
|
Payments for assets under construction
|
| |
(4,612,932)
|
| |
(846,335)
|
Purchase of intangible assets
|
| |
(6,113)
|
| |
(44,452)
|
Purchase of property, plant, and equipment
|
| |
(374,386)
|
| |
(14,872)
|
Proceeds from grants for assets under construction
|
| |
1,895,712
|
| |
—
|
Proceeds from deposits and guarantees
|
| |
1,869,239
|
| |
(830,911)
|
Proceeds from other assets
|
| |
(11,949)
|
| |
—
|
Net cash used in investing activities
|
| |
(1,240,429)
|
| |
(1,736,570)
|
Financing Activities
|
| |
|
| |
|
Payments of notes payable
|
| |
—
|
| |
(564,174)
|
Payments of long-term debt
|
| |
(8,340)
|
| |
—
|
Proceeds from issuance of equity securities
|
| |
—
|
| |
9,579,501
|
Acquisition of Treasury Shares
|
| |
(11,890)
|
| |
(1,094)
|
Net cash (used in) provided by financing activities
|
| |
(20,230)
|
| |
9,014,233
|
Effect of exchange rate changes on cash and cash equivalents
|
| |
(526,836)
|
| |
(650,253)
|
(Decrease) increase in cash and cash equivalents
|
| |
(6,500,132)
|
| |
1,216,390
|
Cash and cash equivalents beginning of period
|
| |
11,545,081
|
| |
10,328,691
|
Cash and cash equivalents end of period
|
| |
$5,044,949
|
| |
$11,545,081
|
Supplemental cash flow information:
|
| |
2022
|
| |
2021
|
Cash paid for income taxes
|
| |
—
|
| |
$(1,925,000)
|
Cash paid for interest
|
| |
—
|
| |
$(7,145)
|
Purchase of property and equipment by incurring current liabilities
|
| |
$268,065
|
| |
$80,505
|
Acquisition of non-controlling interest
|
| |
$49,000
|
| |
—
|
Noncash recognition of new lease
|
| |
$730,333
|
| |
—
|
Machinery and equipment
|
| |
4 years
|
Computer hardware
|
| |
4 years
|
Furniture & Other Fixtures
|
| |
4 - 10 years
|
Technology
|
| |
3 - 6 years
|
Patents, licenses and similar rights
|
| |
20 years
|
•
|
Accounting Standards Codification (ASC) Topic 842 requires a lessee to discount its unpaid lease payments using the interest
rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Generally, the Company cannot determine the interest rate implicit in the lease because it does not have access to the lessor’s
estimated residual value or the amount of the lessor’s deferred initial direct costs. Therefore, the Company uses its incremental borrowing rate as the discount rate for the lease. The Company’s incremental borrowing rate for a lease is
the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms.
|
•
|
The lease term for the Company’s leases includes the noncancelable period of the lease, plus any additional periods covered by
either a Company’s option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor.
|
•
|
Lease payments included in the measurement of the lease liability comprise fixed payments, and the exercise price of Company’s
option to purchase the underlying asset if the Company is reasonably certain to exercise the option.
|
|
| |
December 31,
2022
|
| |
December 31,
2021
|
Accounts receivable
|
| |
$2,099,177
|
| |
$382,698
|
Contract assets
|
| |
2,197,730
|
| |
212,410
|
Contract liabilities
|
| |
(1,735,716)
|
| |
(257,061)
|
Net contract assets
|
| |
$2,561,191
|
| |
$338,047
|
Contract assets
|
| |
Year ended
December 31, 2022
|
| |
Year ended
December 31, 2021
|
Transferred to receivables
|
| |
$(212,410)
|
| |
$ (368,991)
|
Revenue recognized and not billed
|
| |
2,197,730
|
| |
212,410
|
Net change in contract assets
|
| |
$1,985,320
|
| |
$(156,581)
|
Contract liabilities
|
| |
Year ended
December 31, 2022
|
| |
Year ended
December 31, 2021
|
Advanced billings
|
| |
$1,735,716
|
| |
$257,061
|
Revenue recognized during the period
|
| |
(257,061)
|
| |
(16,102)
|
Net change in contract liabilities
|
| |
$1,478,655
|
| |
$240,959
|
|
| |
2022
|
| |
2021
|
Assets under construction
|
| |
$4,852,667
|
| |
$846,335
|
Machinery and equipment
|
| |
357,142
|
| |
23,923
|
Computer hardware
|
| |
83,919
|
| |
45,967
|
Furniture and other fixtures
|
| |
2,038
|
| |
5,730
|
Property, plant, and equipment
|
| |
5,295,766
|
| |
921,955
|
Less accumulated depreciation
|
| |
(147,749)
|
| |
(63,806)
|
Property, plant, and equipment, net
|
| |
$5,148,017
|
| |
$858,149
|
|
| |
2022
|
| |
2021
|
Technology
|
| |
$21,776
|
| |
$21,776
|
Patents and other intangible assets
|
| |
97,729
|
| |
91,617
|
Intangible assets
|
| |
119,505
|
| |
113,393
|
Less accumulated amortization
|
| |
(32,204)
|
| |
(27,890)
|
Intangible assets, net
|
| |
$87,301
|
| |
$85,503
|
|
| |
Weighted-average amortization period (Years)
|
|||
|
| |
2022
|
| |
2021
|
Technology
|
| |
3
|
| |
3
|
Patents and other intangible assets
|
| |
20
|
| |
20
|
|
| |
2022
|
| |
2021
|
Prepayments to suppliers
|
| |
$899,161
|
| |
$—
|
Deposits and project guarantees
|
| |
—
|
| |
1,869,239
|
VAT receivables
|
| |
371,315
|
| |
222,695
|
Other current assets
|
| |
10,792
|
| |
8,457
|
Prepaid expenses and other current assets
|
| |
$1,281,268
|
| |
$2,100,391
|
|
| |
2022
|
| |
2021
|
Accrued employee benefits
|
| |
$221,827
|
| |
$133,541
|
Accounts payable
|
| |
8,019,474
|
| |
315,320
|
Other taxes
|
| |
243,507
|
| |
144,285
|
Accounts payable and other payables
|
| |
$8,484,808
|
| |
$593,146
|
•
|
Grants for research and development activities, which include the development of seasonal storage of renewable energy with green
hydrogen integrated in an intelligent network, research on hybrid storage technologies and predictive models to transform industries into delocalized points of renewable energy management, and research on new materials, technologies and
processes for the generation, storage, transport, and integration of renewable hydrogen and biomethane from biowaste. The grant is for a period of four years, beginning in 2021 and expiring in December 2024.
|
•
|
Grants from the CEC for the development and construction of the hydrogen facility, SoHyCal (refer to note 3). The grant is for a
maximum amount of $3,965,000.
|
|
| |
Unearned grants
|
January 1, 2021
|
| |
$—
|
Additions
|
| |
271,091
|
Disposals
|
| |
—
|
Recognized in income
|
| |
—
|
December 31, 2021
|
| |
271,091
|
Additions
|
| |
1,782,068
|
Disposals
|
| |
—
|
Recognized in income
|
| |
—
|
December 31, 2022
|
| |
$2,053,159
|
|
| |
2022
|
| |
2021
|
Grants in Spain
|
| |
$585,390
|
| |
$227,217
|
Grants in U.S.
|
| |
157,447
|
| |
271,091
|
Grant receivable
|
| |
$742,837
|
| |
$498,308
|
|
| |
Years ended December 31
|
|||
|
| |
2022
|
| |
2021
|
Domestic
|
| |
$(2,236,426)
|
| |
$(1,823,321)
|
Foreign
|
| |
(1,983,905)
|
| |
(2,273,292)
|
Loss before tax expense
|
| |
$(4,220,331)
|
| |
$(4,096,613)
|
|
| |
Years ended December 31
|
|||
|
| |
2022
|
| |
2021
|
Domestic
|
| |
$74,196
|
| |
$33,240
|
State
|
| |
1,932
|
| |
800
|
Foreign
|
| |
—
|
| |
—
|
Total current taxes
|
| |
76,128
|
| |
34,040
|
Domestic
|
| |
—
|
| |
263
|
State
|
| |
—
|
| |
88
|
Foreign
|
| |
—
|
| |
—
|
Total deferred taxes
|
| |
—
|
| |
351
|
Total income tax expense
|
| |
$76,128
|
| |
$34,391
|
|
| |
Years ended December 31
|
|||||||||
|
| |
2022
|
| |
2021
|
||||||
U.S. Statutory tax rate
|
| |
$(886,270)
|
| |
21.0%
|
| |
$(860,215)
|
| |
21.0%
|
State income taxes, less federal income tax benefits
|
| |
(155,230)
|
| |
3.7%
|
| |
719
|
| |
0.0%
|
Uncertain tax positions
|
| |
58,741
|
| |
(1.4)%
|
| |
33,241
|
| |
(0.8)%
|
Foreign rate differential
|
| |
(75,779)
|
| |
1.8%
|
| |
(87,407)
|
| |
2.1%
|
R&D credit
|
| |
(100,939)
|
| |
2.4%
|
| |
—
|
| |
0.0.%
|
Change in valuation allowance
|
| |
1,102,817
|
| |
(26.1)%
|
| |
929,548
|
| |
(22.7)%
|
Other
|
| |
132,788
|
| |
(3.1)%
|
| |
18,505
|
| |
(0.5)%
|
Total
|
| |
$76,128
|
| | | |
$34,391
|
| | ||
Effective tax rate
|
| |
%
|
| |
(1.8)%
|
| |
%
|
| |
(0.8)%
|
|
| |
Years ended December 31
|
|||
|
| |
2022
|
| |
2021
|
Tax loss carryforwards
|
| |
$2,545,115
|
| |
$2,153,239
|
Research and development expenditures
|
| |
169,009
|
| |
268,234
|
Unrealized gain/loss
|
| |
294,001
|
| |
106,288
|
All other assets
|
| |
690,475
|
| |
68,021
|
Total deferred tax assets
|
| |
$3,698,600
|
| |
2,595,782
|
Valuation allowances
|
| |
(3,698,600)
|
| |
(2,595,782)
|
Total net deferred tax assets
|
| |
$—
|
| |
$—
|
|
| |
Years ended December 31
|
|||
|
| |
2022
|
| |
2021
|
Beginning balance
|
| |
$1,489,396
|
| |
$1,056,236
|
Increase due to current year tax positions
|
| |
—
|
| |
—
|
Increase due to prior year tax positions
|
| |
—
|
| |
433,160
|
Ending balance
|
| |
$1,489,396
|
| |
$1,489,396
|
|
| |
SOP 1
|
| |
SOP 2
|
Granted shares
|
| |
68,966
|
| |
18,750
|
|
| |
|
| |
|
Vesting conditions
|
| |
None
|
| |
Service and performance condition
|
|
| |
|
| |
|
Vesting period
|
| |
At grant date
|
| |
Ratably over 5 years
|
|
| |
|
| |
|
Classification
|
| |
Equity
|
| |
Equity
|
|
| |
SOP 1
|
| |
SOP 2
|
Expected term of options (years)
|
| |
2
|
| |
5
|
Risk free interest rate (%)
|
| |
4.23
|
| |
3.50
|
Volatility (%)
|
| |
25
|
| |
30
|
Strike Price ($)
|
| |
29
|
| |
0.0001
|
Fair value ($)
|
| |
0.000001
|
| |
6.03
|
SOP 1
|
| |
Shares
|
| |
Exercise Price
|
| |
Remaining Contractual Life
|
Outstanding at December 31, 2021
|
| |
—
|
| |
—
|
| |
|
Granted
|
| |
68,966
|
| |
29
|
| |
|
Exercised
|
| |
—
|
| |
—
|
| |
|
Forfeited
|
| |
—
|
| |
—
|
| |
|
Outstanding at December 31, 2022
|
| |
68,966
|
| |
29
|
| |
2 years
|
Exercisable at December 31, 2022
|
| |
68,966
|
| |
29
|
| |
2 years
|
SOP 2
|
| |
Shares
|
| |
Exercise Price
|
| |
Remaining Contractual Life
|
Outstanding at December 31, 2021
|
| |
—
|
| |
—
|
| |
|
Granted
|
| |
18,750
|
| |
0.0001
|
| |
|
Exercised
|
| |
—
|
| |
—
|
| |
|
Forfeited
|
| |
—
|
| |
—
|
| |
|
Outstanding at December 31, 2022
|
| |
18,750
|
| |
0.0001
|
| |
5 years
|
Exercisable at December 31, 2022
|
| |
—
|
| |
—
|
| |
—
|
•
|
The Company’s stock is publicly traded prior to January 1, 2026
|
•
|
The executive maintains employment with the Company until March 31, 2026
|
|
| |
Operating Leases
|
2023
|
| |
$290,645
|
2024
|
| |
344,984
|
2025
|
| |
346,020
|
2026
|
| |
347,087
|
2027
|
| |
331,314
|
Thereafter
|
| |
2,287,624
|
Total future minimum lease payments
|
| |
3,947,674
|
Less imputed lease interest
|
| |
(1,605,499)
|
Total lease liabilities
|
| |
$2,342,175
|
|
| |
Year ended
December 31, 2022
|
| |
Year ended
December 31, 2021
|
Cash payments
|
| |
$108,000
|
| |
$63,000
|
Weighted average remaining lease term (years)
|
| |
15.06
|
| |
20
|
Weighted average discount rate
|
| |
7.81%
|
| |
7.00%
|
Noncash lease amount
|
| |
55,646
|
| |
—
|
For the year ended December 31,
|
| |
2022
|
| |
2021
|
Net (loss) attributable to Stockholders’ of the parent
|
| |
$(4,296,459)
|
| |
$(4,130,751)
|
Total weighted average shares outstanding
|
| |
9,727,939
|
| |
8,321,904
|
Net loss per share (basic and diluted)
|
| |
$(0.44)
|
| |
$(0.50)
|
|
| |
Product sales
|
| |
Long-lived assets
|
||||||
Region
|
| |
2022
|
| |
2021
|
| |
2022
|
| |
2021
|
North America
|
| |
$—
|
| |
$—
|
| |
$6,361,086
|
| |
$2,411,284
|
LATAM(1)
|
| |
3,275,038
|
| |
436,124
|
| |
—
|
| |
—
|
Europe
|
| |
216,635
|
| |
525,483
|
| |
1,110,086
|
| |
85,503
|
Total
|
| |
$3,491,673
|
| |
$961,607
|
| |
$7,471,172
|
| |
$2,496,787
|
(1)
|
LATAM comprises Central America, South America, and Mexico.
|
|
| |
September 30,
2023
|
| |
December 31,
2022
|
|
| |
Unaudited
|
| |
|
Assets:
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash
|
| |
$
|
| |
$
|
Prepaid expenses
|
| |
|
| |
|
Total current assets
|
| |
|
| |
|
|
| |
|
| |
|
Cash and investments held in Trust Account
|
| |
|
| |
|
Total Assets
|
| |
$
|
| |
$
|
|
| |
|
| |
|
Liabilities, Class A Ordinary Shares
Subject to Possible Redemption and Shareholders’ Deficit:
|
| |
|
| |
|
Current liabilities:
|
| |
|
| |
|
Accounts payable
|
| |
$
|
| |
$
|
Accrued expenses
|
| |
|
| |
|
Accrued expenses - related party
|
| |
|
| |
|
Total current liabilities
|
| |
|
| |
|
|
| |
|
| |
|
Deferred legal fees
|
| |
|
| |
|
Deferred underwriting commissions
|
| |
|
| |
|
Convertible working capital loan -
|
| |
|
| |
|
Derivative warrant liabilities
|
| |
|
| |
|
Total liabilities
|
| |
|
| |
|
|
| |
|
| |
|
Commitments and Contingencies
|
| |
|
| |
|
Class A ordinary shares;
|
| |
|
| |
|
|
| |
|
| |
|
Shareholders’ Deficit:
|
| |
|
| |
|
Preference shares, $
|
| |
|
| |
|
Class A ordinary shares, $
|
| |
|
| |
|
Class B ordinary shares, $
|
| |
|
| |
|
Additional paid-in capital
|
| |
|
| |
|
Accumulated deficit
|
| |
(
|
| |
(
|
Total shareholders’ deficit
|
| |
(
|
| |
(
|
Total Liabilities, Class A Ordinary
Shares Subject to Possible Redemption and Shareholders’ Deficit
|
| |
$
|
| |
$
|
|
| |
For the Three Months
Ended September 30,
|
| |
For the Nine Months
Ended September 30,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
General and administrative expenses
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
Loss from operations
|
| |
(
|
| |
(
|
| |
(
|
| |
(
|
|
| |
|
| |
|
| |
|
| |
|
Other (expense) income:
|
| |
|
| |
|
| |
|
| |
|
Change in fair value of derivative liabilities
|
| |
(
|
| |
(
|
| |
(
|
| |
|
Reduction in deferred underwriter commissions
|
| |
|
| |
|
| |
|
| |
|
Interest income - bank
|
| |
|
| |
|
| |
|
| |
|
Interest expense
|
| |
|
| |
(
|
| |
|
| |
(
|
Investment income earned on cash and investments held
in Trust Account
|
| |
|
| |
|
| |
|
| |
|
Total other (expense) income, net
|
| |
(
|
| |
|
| |
|
| |
|
Net (loss) income
|
| |
$(
|
| |
$
|
| |
$(
|
| |
$
|
|
| |
|
| |
|
| |
|
| |
|
Weighted average Class A ordinary shares, basic and
diluted
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted net (loss) income
per ordinary share, Class A
|
| |
$(
|
| |
$
|
| |
$(
|
| |
$
|
|
| |
|
| |
|
| |
|
| |
|
Weighted average Class B ordinary shares, basic and
diluted
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted net (loss) income
per ordinary share, Class B
|
| |
$(
|
| |
$
|
| |
$(
|
| |
$
|
|
| |
Ordinary Shares
|
| |
Additional
Paid-in
Capital
|
| |
Accumulated
Deficit
|
| |
Total
Shareholders’
Deficit
|
|||||||||
|
| |
Class A
|
| |
Class B
|
| ||||||||||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balance - December 31, 2022
|
| |
|
| |
$
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Remeasurement adjustment of Class A ordinary shares
subject to possible redemption
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Net loss
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Balance - March 31, 2023
|
| |
|
| |
$
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
|
$(
|
|
Reduction in deferred underwriting commissions
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Remeasurement adjustment of Class A ordinary shares
subject to possible redemption
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Net loss
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Balance – June 30, 2023
|
| |
|
| |
$
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Remeasurement adjustment of Class A ordinary shares
subject to possible redemption
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
(
|
| |
|
| |
(
|
Net loss
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Balance - September 30, 2023
|
| |
|
| |
$
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
|
| |
Ordinary Shares
|
| |
Additional
Paid-in
Capital
|
| |
Accumulated
Deficit
|
| |
Total
Shareholders’
Deficit
|
|||||||||
|
| |
Class A
|
| |
Class B
|
| ||||||||||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balance - December 31, 2021
|
| |
|
| |
$
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Net income
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Balance - March 31, 2022 (unaudited)
|
| |
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Increase in redemption value of Class A ordinary shares
subject to possible redemption
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Net income
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Balance - June 30, 2022 (unaudited)
|
| |
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Increase in redemption value of Class A ordinary shares
subject to possible redemption
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Net income
|
| |
—
|
| |
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Balance - September 30, 2022
(unaudited)
|
| |
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
|
| |
For the Nine Months Ended September 30,
|
|||
|
| |
2023
|
| |
2022
|
Cash Flows from Operating Activities:
|
| |
|
| |
|
Net (loss) income
|
| |
$(
|
| |
$
|
Adjustments to reconcile net (loss) income to net cash
used in operating activities:
|
| |
|
| |
|
Change in fair value of derivative liabilities
|
| |
|
| |
(
|
Interest expense
|
| |
|
| |
|
Investment income earned on cash and investments held
in Trust Account
|
| |
(
|
| |
(
|
Reduction in deferred underwriting commissions
|
| |
(
|
| |
|
Changes in operating assets and liabilities:
|
| |
|
| |
|
Prepaid expenses
|
| |
(
|
| |
|
Accounts payable
|
| |
(
|
| |
|
Accrued expenses - related party
|
| |
|
| |
|
Accrued expenses
|
| |
|
| |
|
Net cash used in operating activities
|
| |
(
|
| |
(
|
|
| |
|
| |
|
Cash Flows from Investing Activities:
|
| |
|
| |
|
Cash withdrawn from Trust Account for working capital purposes
|
| |
|
| |
|
Cash withdrawn from Trust Account in connection with redemption
|
| |
|
| |
|
Net cash provided by investing activities
|
| |
|
| |
|
|
| |
|
| |
|
Cash Flows from Financing Activities:
|
| |
|
| |
|
Proceeds from convertible promissory note - related party
|
| |
|
| |
|
Redemption of common stock
|
| |
(
|
| |
|
Net cash (used in) provided by financing activities
|
| |
(
|
| |
|
|
| |
|
| |
|
Net increase (decrease) in cash
|
| |
|
| |
(
|
Cash - beginning of the period
|
| |
|
| |
|
Cash - end of the period
|
| |
$
|
| |
$
|
|
| |
|
| |
|
Supplemental disclosure of noncash
investing and financing activities:
|
| |
|
| |
|
Increase in value of Class A common stock subject to
possible redemption
|
| |
$
|
| |
$
|
Reduction in deferred underwriting fee payable
|
| |
$
|
| |
$
|
•
|
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
•
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as
quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
•
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its
own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
|
| |
For the Three Months Ended September 30,
|
| |
For the Nine Months Ended September 30,
|
||||||||||||||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
||||||||||||
|
| |
Class A
|
| |
Class B
|
| |
Class A
|
| |
Class B
|
| |
Class A
|
| |
Class B
|
| |
Class A
|
| |
Class B
|
Basic and diluted net (loss) income per common share:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Numerator:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Allocation of net (loss) income
|
| |
$(
|
| |
$(
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
|
$
|
| |
$
|
|
Denominator:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted weighted average common shares
outstanding
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted net (loss) income per common share
|
| |
$(
|
| |
$(
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
| |
$
|
| |
$
|
•
|
by written consent of H2B2 and the Company;
|
•
|
by H2B2 or the Company if any governmental authority has enacted, issued, promulgated, enforced or entered any law or
governmental order which has become final and non-appealable and has the effect of making consummation of the transactions contemplated by the Merger Agreement and the Ancillary Agreements (as defined in the Merger Agreement) illegal or
otherwise enjoining, preventing or prohibiting the consummation of the transactions contemplated by the Merger Agreement and the Ancillary Agreements (provided that such party did not cause such enactment);
|
•
|
by H2B2 or the Company if the consummation of the Transactions has not occurred on or prior to June 30, 2024, subject to certain
automatic extensions, for reasons not primarily due to the terminating party’s breach or violation of the terms of the Merger Agreement;
|
•
|
by H2B2 or the Company if such party disagrees with the final determination of the Closing Date Purchase Price (as defined in
the Merger Agreement) by the valuation firm as further described in the Merger Agreement;
|
•
|
by H2B2 if there has been a modification in recommendation of the Company’s board of directors with respect to any of the
Proposals (as defined in the Merger Agreement);
|
•
|
by H2B2 if the Company has not obtained shareholder approval for the Transactions by reason of the failure to obtain the
required vote at a meeting of the Company’s shareholders;
|
•
|
by H2B2 if (i) prior to completion of a Capital Raise Transaction (as defined in the Merger Agreement), a Capital Raise
Investor (as defined in the Merger Agreement) or group of Capital Raise Investors, with legal,
|
•
|
by H2B2 in the event of an uncured breach of any representation, warranty, covenant or agreement on the part of the Company,
except if the breach is curable by the Company through the exercise of its reasonable best efforts, then, for a period of up to
(30) days after receipt by the Company of notice from H2B2 of such breach, but only as long as the Company continues to exercise such reasonable best efforts to cure such breach, such termination will not be effective, and such
termination will be effective only if such breach is not cured within the |
•
|
by the Company in the event of an uncured breach of any representation, warranty, covenant or agreement on the part of H2B2,
except if the breach is curable by H2B2 through the exercise of its reasonable best efforts, then, for a period of up to
(30) days after receipt by H2B2 of notice from the Company of such breach, but only as long as H2B2 continues to exercise such reasonable best efforts to cure such breach, such termination will not be effective, and such termination
will be effective only if such breach is not cured within the |
•
|
by the Company if the H2B2 stockholder approval has not been obtained; and
|
•
|
by the Company if an H2B2 stockholder exercises any right or takes any action or fails to take any action required to satisfy
the conditions or any closing deliverables required to be delivered under the Merger Agreement that prevents consummation of the Merger and the other transactions contemplated by the Merger Agreement and the Ancillary Agreements.
|
Class A ordinary shares subject to possible redemption at
December 31, 2021
|
| |
$
|
Increase in redemption value of Class A ordinary shares subject to possible
redeem
|
| |
|
Class A ordinary shares subject to possible redemption at
December 31, 2022
|
| |
|
Redemptions of Class A ordinary shares
|
| |
(
|
Increase in redemption value of Class A ordinary shares subject to possible
redeem
|
| |
|
Class A ordinary shares subject to possible redemption at
September 30, 2023
|
| |
$
|
•
|
in whole and not in part;
|
•
|
at a price of $
|
•
|
upon not less than
|
•
|
if, and only if, the last reported sale price (the “closing price”) of Class A ordinary shares equals or exceeds $
|
•
|
in whole and not in part;
|
•
|
at $
|
•
|
if, and only if, the closing price of Class A ordinary shares equals or exceeds $
|
•
|
if the closing price of the Class A ordinary shares for any
|
Description
|
| |
Level 1
|
| |
Level 2
|
| |
Level 3
|
Assets:
|
| |
|
| |
|
| |
|
Cash held in Trust Account
|
| |
$
|
| |
$—
|
| |
$—
|
Liabilities:
|
| |
|
| |
|
| |
|
Derivative liabilities - Public Warrants
|
| |
$
|
| |
$—
|
| |
$—
|
Derivative liabilities - Private Warrants
|
| |
$—
|
| |
$—
|
| |
$
|
Description
|
| |
Level 1
|
| |
Level 2
|
| |
Level 3
|
Assets:
|
| |
|
| |
|
| |
|
Investments held in Trust Account - Money Market Funds
|
| |
$
|
| |
$—
|
| |
$—
|
Liabilities:
|
| |
|
| |
|
| |
|
Derivative liabilities - Public Warrants
|
| |
$
|
| |
$—
|
| |
$—
|
Derivative liabilities - Private Warrants
|
| |
$—
|
| |
$—
|
| |
$
|
Private Warrants
|
| |
As of
December 31,
2022
|
| |
As of
September 30,
2023
|
Stock price
|
| |
$
|
| |
$
|
Volatility
|
| |
|
| |
|
Expected life of the options to convert
|
| |
|
| |
|
Risk-free rate
|
| |
|
| |
|
Dividend yield
|
| |
|
| |
|
|
| |
December 31,
2022
|
| |
September 30,
2023
|
Strike price of debt conversion
|
| |
$
|
| |
$
|
Volatility
|
| |
|
| |
|
Expected life of the options to convert
|
| |
|
| |
|
Risk-free rate
|
| |
|
| |
|
Dividend yield
|
| |
|
| |
|
|
| |
Private
Warrants
|
Derivative warrant liabilities at December 31, 2022
|
| |
$
|
Change in fair value of derivative warrant liabilities
|
| |
|
Derivative warrant liabilities at March 31, 2023
|
| |
|
Change in fair value of derivative warrant liabilities
|
| |
(
|
Derivative warrant liabilities at June 30, 2023
|
| |
$
|
Change in fair value of derivative warrant liabilities
|
| |
|
Derivative warrant liabilities at September 30, 2023
|
| |
$
|
Derivative warrant liabilities at December 31, 2021
|
| |
$
|
Change in fair value of derivative warrant liabilities
|
| |
(
|
Derivative warrant liabilities at March 31, 2022
|
| |
|
|
| |
Private
Warrants
|
Change in fair value of derivative warrant liabilities
|
| |
(
|
Derivative warrant liabilities at June 30, 2022
|
| |
$
|
Change in fair value of derivative warrant liabilities
|
| |
|
Derivative warrant liabilities at September 30, 2022
|
| |
$
|
Balance at December 31, 2021
|
| |
$
|
Initial fair value of the Working Capital Loan Option
|
| |
|
Change in fair value
|
| |
(
|
Balance at December 31, 2022 and September 30, 2023
|
| |
$
|
•
|
Base Purchase Price. Removal of the definition of Base Purchase Price.
|
•
|
Closing Date Purchase Price. Amendment to the definition of Closing Date
Purchase Price to a fixed purchase price of $
|
•
|
AVR Option Amount. Removal of the AVR Option Amount from the calculation of
the Closing Date Purchase Price and Minimum Investment Amount as a result of the agreement between the current Chairman of the Board of Directors of H2B2, Mr. Vázquez, and H2B2 to delay the exercise of Mr. Vázquez’s option to acquire
up to
|
•
|
Minimum Investment Amount. Reduction of the Minimum Investment Amount from $
|
•
|
|
•
|
Minimum Net Tangible Assets Condition. Removal of the condition precedent to
closing of the Merger that RMG III will have at least $
|
•
|
Conversion of RMG III Class B Ordinary Shares. Amendment to the definition of
Founder Consideration Shares and other related sections of the Merger Agreement to reflect the planned partial conversion by Sponsor of certain RMG III Class B Ordinary Shares into RMG III Class A Ordinary Shares prior to closing of
the Merger.
|
•
|
Warrant Amendment. Amendment to the covenant relating to the Warrant
Amendment to clarify that RMG III will, following its execution, cause, in connection with the Closing, each of the then outstanding Public Warrants and Private Placement Warrants to represent the right to receive up to
|
•
|
Director Nominees. Amendment to the covenant relating to the composition of
the Surviving Corporation Board to provide that, immediately following the Effective Time, the Surviving Corporation Board will consist of nine (
|
|
| |
December 31,
|
|||
|
| |
2022
|
| |
2021
|
Assets:
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash
|
| |
$
|
| |
$
|
Prepaid expenses
|
| |
|
| |
|
Total current assets
|
| |
|
| |
|
Investments held in Trust Account
|
| |
|
| |
|
Other assets
|
| |
—
|
| |
|
Total Assets
|
| |
$
|
| |
$
|
Liabilities, Class A Ordinary Shares
Subject to Possible Redemption and Shareholders’ Deficit:
|
| |
|
| |
|
Current liabilities:
|
| |
|
| |
|
Accounts payable
|
| |
$
|
| |
$
|
Accrued expenses
|
| |
|
| |
|
Accrued expenses - related party
|
| |
|
| |
|
Total current liabilities
|
| |
|
| |
|
Deferred legal fees
|
| |
|
| |
|
Deferred underwriting commissions
|
| |
|
| |
|
|
| |
|
| |
|
Derivative warrant liabilities
|
| |
|
| |
|
Total liabilities
|
| |
|
| |
|
Commitments and Contingencies
|
| |
|
| |
|
Class A ordinary shares;
|
| |
|
| |
|
Shareholders’ Deficit:
|
| |
|
| |
|
Preference shares, $
|
| |
|
| |
|
Class A ordinary shares, $
|
| |
|
| |
|
Class B ordinary shares, $
|
| |
|
| |
|
Additional paid-in capital
|
| |
—
|
| |
|
Accumulated deficit
|
| |
(
|
| |
(
|
Total shareholders’ deficit
|
| |
(
|
| |
(
|
Total Liabilities, Class A Ordinary
Shares Subject to Possible Redemption and Shareholders’ Deficit
|
| |
$
|
| |
$
|
|
| |
For the year ended December 31,
|
|||
|
| |
2022
|
| |
2021
|
General and administrative expenses
|
| |
$
|
| |
$
|
Loss from operations
|
| |
(
|
| |
(
|
Other income (expense)
|
| |
|
| |
|
Change in fair value of derivative liabilities
|
| |
|
| |
|
Financing costs - warrant liabilities
|
| |
|
| |
(
|
Interest income
|
| |
|
| |
|
Interest expense
|
| |
(
|
| |
|
Unrealized gain on investments held in Trust Account
|
| |
|
| |
|
Total other income (expense)
|
| |
|
| |
|
Net income
|
| |
$
|
| |
$
|
Weighted average Class A ordinary shares, basic and diluted
|
| |
|
| |
|
Basic and diluted net income per ordinary share, Class A
|
| |
$
|
| |
$
|
Weighted average Class B ordinary shares, basic and diluted
|
| |
|
| |
|
Basic and diluted net income per ordinary share, Class B
|
| |
$
|
| |
$
|
|
| |
Ordinary Shares
|
| |
Additional
Paid-in
Capital
|
| |
Accumulated
Deficit
|
| |
Total
Shareholders’
Equity
(Deficit)
|
|||||||||
|
| |
Class A
|
| |
Class B
|
| ||||||||||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balance - December 31, 2020
|
| |
|
| |
$
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$
|
Excess purchase price above fair value of private
placement warrants
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
|
| |
—
|
| |
|
Remeasurement adjustment of Class A ordinary shares
subject to possible redemption
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(
|
| |
(
|
| |
(
|
Net income
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
|
| |
|
Balance - December 31, 2021
|
| |
|
| |
$
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Remeasurement adjustment of Class A ordinary shares
subject to possible redemption
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(
|
| |
(
|
Net income
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
|
| |
|
Balance - December 31, 2022
|
| |
|
| |
$
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
|
| |
For the year ended December 31,
|
|||
|
| |
2022
|
| |
2021
|
Cash Flows from Operating Activities:
|
| |
|
| |
|
Net income
|
| |
$
|
| |
$
|
Adjustments to reconcile net income to net cash used in operating activities:
|
| |
|
| |
|
Change in fair value of derivative liabilities
|
| |
(
|
| |
(
|
Financing costs - warrant liabilities
|
| |
|
| |
|
Interest expense
|
| |
|
| |
|
Unrealized gain on investments held in Trust Account
|
| |
(
|
| |
(
|
Changes in operating assets and liabilities:
|
| |
|
| |
|
Prepaid expenses and other assets
|
| |
|
| |
(
|
Accounts payable
|
| |
|
| |
|
Accrued expenses
|
| |
|
| |
|
Accrued expenses - related party
|
| |
|
| |
|
Net cash used in operating activities
|
| |
(
|
| |
(
|
Cash Flows from Investing Activities:
|
| |
|
| |
|
Cash deposited in Trust Account
|
| |
|
| |
(
|
Cash withdrawn from Trust Account
|
| |
|
| |
|
Net cash provided by (used in) investing activities
|
| |
|
| |
(
|
Cash Flows from Financing Activities:
|
| |
|
| |
|
Proceeds from note payable to related party
|
| |
|
| |
|
Repayment of note payable to related party
|
| |
|
| |
(
|
Proceeds from convertible working capital loan
|
| |
|
| |
|
Proceeds received from initial public offering, gross
|
| |
|
| |
|
Proceeds received from private placement
|
| |
|
| |
|
Offering costs paid
|
| |
|
| |
(
|
Net cash provided by financing activities
|
| |
|
| |
|
Net (decrease) increase in cash
|
| |
(
|
| |
|
Cash - beginning of the year
|
| |
|
| |
—
|
Cash - end of the year
|
| |
$
|
| |
$
|
Supplemental disclosure of noncash investing and financing
activities:
|
| |
|
| |
|
Increase in redemption value of Class A ordinary shares
subject to possible redemption
|
| |
$
|
| |
$
|
Offering costs included in accrued expenses
|
| |
$
|
| |
$
|
Offering costs paid by related party under promissory note
|
| |
$
|
| |
$
|
Deferred legal fees
|
| |
$
|
| |
$
|
Deferred underwriting commissions
|
| |
$
|
| |
$
|
Remeasurement of Class A ordinary shares to redemption amount
|
| |
$
|
| |
$
|
•
|
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
•
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as
quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
•
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its
own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
|
| |
For the Year Ended
December 31, 2022
|
| |
For the Year Ended
December 31, 2021
|
||||||
|
| |
Class A
|
| |
Class B
|
| |
Class A
|
| |
Class B
|
Basic and diluted net income per common share:
|
| |
|
| |
|
| |
|
| |
|
Numerator:
|
| |
|
| |
|
| |
|
| |
|
Allocation of net income (loss)
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
Denominator:
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted weighted average common shares
outstanding
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted net income per common share
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
Gross Proceeds
|
| |
$
|
Less:
|
| |
|
Offering costs allocated to Class A shares subject to possible redemption
|
| |
(
|
Proceeds allocated to Public Warrants at issuance
|
| |
(
|
Plus:
|
| |
|
Accrection on Class A ordinary shares subject to possible redemption amount
|
| |
|
Class A ordinary shares subject to possible redemption at December 31, 2021
|
| |
|
Increase in redemption value of Class A ordinary shares subject to possible
redeem
|
| |
|
Class A ordinary shares subject to possible redemption at
December 31, 2022
|
| |
$
|
•
|
in whole and not in part;
|
•
|
at a price of $
|
•
|
upon not less than
|
•
|
if, and only if, the last reported sale price (the “closing price”) of Class A ordinary shares equals or exceeds $
|
•
|
in whole and not in part;
|
•
|
at $
|
•
|
if, and only if, the closing price of Class A ordinary shares equals or exceeds $
|
•
|
if the closing price of the Class A ordinary shares for any
|
Description
|
| |
Level 1
|
| |
Level 2
|
| |
Level 3
|
Assets:
|
| |
|
| |
|
| |
|
Investments held in Trust Account - Money Market Funds
|
| |
$
|
| |
$—
|
| |
$—
|
Liabilities:
|
| |
|
| |
|
| |
|
Derivative liabilities - Public Warrants
|
| |
$
|
| |
$—
|
| |
$—
|
Derivative liabilities - Private Warrants
|
| |
$—
|
| |
$—
|
| |
$
|
Description
|
| |
Level 1
|
| |
Level 2
|
| |
Level 3
|
Assets:
|
| |
|
| |
|
| |
|
Investments held in Trust Account - U.S. Treasury Securities
|
| |
$
|
| |
$—
|
| |
$—
|
Liabilities:
|
| |
|
| |
|
| |
|
Derivative liabilities - Public Warrants
|
| |
$
|
| |
$—
|
| |
$—
|
Derivative liabilities - Private Warrants
|
| |
$—
|
| |
$—
|
| |
$
|
Private Warrants
|
| |
As of
December 31,
2022
|
| |
As of
December 31,
2021
|
Stock price
|
| |
$
|
| |
$
|
Volatility
|
| |
|
| |
|
Expected life of the options to convert
|
| |
|
| |
|
Risk-free rate
|
| |
|
| |
|
Dividend yield
|
| |
|
| |
|
|
| |
December 31,
2022
|
Strike price of debt conversion
|
| |
$
|
Volatility
|
| |
|
Expected life of the options to convert
|
| |
|
Risk-free rate
|
| |
|
Dividend yield
|
| |
|
|
| |
Public
Warrants
|
| |
Private
Warrants
|
| |
Total
|
Derivative warrant liabilities at December 31, 2020
|
| |
$
|
| |
$
|
| |
$
|
Issuance of Public and Private Warrants
|
| |
|
| |
|
| |
|
Transfer of Public Warrants to Level 1
|
| |
(
|
| |
|
| |
(
|
Change in fair value of derivative warrant liabilities
|
| |
|
| |
(
|
| |
(
|
Derivative warrant liabilities at December 31, 2021
|
| |
|
| |
|
| |
|
warrant liabilities |
| |
|
| |
(
|
| |
(
|
Derivative warrant liabilities at December 31, 2022
|
| |
$
|
| |
$
|
| |
$
|
Balance at December 31, 2021
|
| |
$
|
Initial fair value of the Working Capital Loan Option
|
| |
|
Change in fair value
|
| |
(
|
Balance at December 31, 2022
|
| |
$
|
|
| |
|
| |
Page
|
ARTICLE I
|
||||||
|
| |
|
| |
|
CERTAIN DEFINITIONS
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE II
|
||||||
|
| |
|
| |
|
THE MERGER; CLOSING
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE III
|
||||||
|
| |
|
| |
|
EFFECTS OF THE MERGER ON ACQUIROR AND COMPANY SECURITIES
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE IV
|
||||||
|
| |
|
| |
|
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | |
|
| |
|
| |
Page
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE V
|
||||||
|
| |
|
| |
|
REPRESENTATIONS AND WARRANTIES OF ACQUIROR
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE VI
|
||||||
|
| |
|
| |
|
COVENANTS OF THE COMPANY
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
|
| |
|
| |
Page
|
ARTICLE VII
|
||||||
|
| |
|
| |
|
COVENANTS OF ACQUIROR
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE VIII
|
||||||
|
| |
|
| |
|
JOINT COVENANTS
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE IX
|
||||||
|
| |
|
| |
|
CONDITIONS TO OBLIGATIONS
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE X
|
||||||
|
| |
|
| |
|
TERMINATION/EFFECTIVENESS
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
|
| |
|
| |
|
ARTICLE XI
|
||||||
|
| |
|
| |
|
MISCELLANEOUS
|
||||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | |
|
| |
|
| |
Page
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | |
|
| |
(i)
|
| |
If to Acquiror prior to the Closing, or to the Surviving Corporation after the
Effective Time, to:
|
|
| |
|
| |
|
|
| |
RMG Acquisition Corp. III
|
|||
|
| |
57 Ocean, Suite 403, 5775 Collins Avenue
|
|||
|
| |
Miami Beach, Florida
|
|||
|
| |
Attention:
|
| |
Philip Kassin
|
|
| |
Email:
|
| |
pkassin@rmginvestments.com
|
|
| |
|
| |
|
with copies to (which shall not constitute notice):
|
||||||
|
| |
|
| |
|
|
| |
Skadden, Arps, Slate, Meagher & Flom (UK) LLP
|
|||
|
| |
22 Bishopsgate, EC2N 4BQ London
|
|||
|
| |
Attention:
|
| |
Lorenzo Corte; Maria Protopapa
|
|
| |
Email:
|
| |
lorenzo.corte@skadden.com
|
|
| |
|
| |
maria.protopapa@skadden.com
|
|
| |
|
| |
|
|
| |
(ii)
|
| |
If to the Company prior to the Closing, or to the Surviving Corporation after
the Effective Time, to:
|
|
| |
|
| |
|
|
| |
H2B2 Electrolysis Technologies, Inc.
|
|||
|
| |
300 Delaware Ave Ste 210-A
|
|||
|
| |
Wilmington, DE 19801
|
|||
|
| |
Attention:
|
| |
Anselmo Andrade; Mario Barragan
|
|
| |
Email:
|
| |
anselmo.andrade@h2b2.es;
|
|
| |
|
| |
mario.barragan@h2b2.es
|
|
| |
|
| |
|
with copies to (which shall not constitute notice):
|
||||||
|
| |
|
| |
|
|
| |
Latham & Watkins LLP
|
|||
|
| |
811 Main Street, Suite 3700
|
|||
|
| |
Houston, Texas 77002
|
|||
|
| |
Attention:
|
| |
Ryan Maierson; Thomas Verity
|
|
| |
Email:
|
| |
ryan.maierson@lw.com
|
|
| |
|
| |
thomas.verity@lw.com
|
|
| |
RMG ACQUISITION CORP. III
|
||||||
|
| |
|
| |||||
|
| |
By:
|
| |
/s/ Philip Kassin
|
|||
|
| |
|
| |
Name:
|
| |
Philip Kassin
|
|
| |
|
| |
Title:
|
| |
President and COO
|
|
| |
H2B2 ELECTROLYSIS TECHNOLOGIES, INC.
|
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|
| |
|
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|
|
| |
By:
|
| |
|
|
| |
|
| |
Name:
|
|
| |
|
| |
Title:
|
|
| |
RMG ACQUISITION CORP. III
|
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By:
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Name:
|
| ||
|
| |
|
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Title:
|
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|
| |
H2B2 ELECTROLYSIS TECHNOLOGIES, INC.
|
||||||
|
| |
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Anselmo Andrade Fernández de Mesa
|
|||
|
| |
|
| |
Name:
|
| |
Anselmo Andrade Fernández de Mesa
|
|
| |
|
| |
Title:
|
| |
Chief Executive Officer
|
|
| |
|
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Page
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|
| |
COMPANY:
|
|||
|
| |
, a Delaware corporation
|
|||
|
| |
By:
|
| |
|
|
| |
Name:
|
| |
|
|
| |
Title:
|
| |
|
|
| |
HOLDERS:
|
|||
|
| |
|
| |
|
|
| |
RMG SPONSOR III LLC, a
Delaware limited liability company
|
|||
|
| |
|
| |
|
|
| |
By:
|
| |
|
|
| |
Name:
|
| |
|
|
| |
Title:
|
| |
|
|
| |
|
|
| |
Name:
|
|
| |
|
|||
|
| |
Signature of Stockholder
|
|||
|
| |
|
|||
|
| |
Print Name of Stockholder
|
|||
|
| |
|
|||
|
| |
Its:
|
|||
|
| |
|
| |
|
|
| |
Address:
|
| |
|
|
| |
|
| |
|
|
| |
|
| |
|
|
| |
|
| |
|
By:
|
| |
|
| |
|
Name:
|
| |
|
| |
|
Its:
|
| |
|
| |
|
(i)
|
in the case of an entity, Transfers (A) to another entity that is an affiliate (as defined in Rule 405 promulgated under the
Securities Act) of the undersigned, or to any investment fund or other entity controlling, controlled by, managing or managed by or under common control with the undersigned or affiliates of the undersigned or who shares a common
investment advisor with the undersigned or (B) as part of a distribution to members, partners, shareholders or equity holders of the undersigned;
|
(ii)
|
in the case of an individual, Transfers by gift to members of the individual’s immediate family (as defined below) or to a
trust, the beneficiary of which is a member of one of the individual’s immediate family, an affiliate of such person or to a charitable organization;
|
1
|
NTD: To be included for C-level executives of the Company, Chairman, Blanca de Porres Guardiola,
and Ardachon (subject to exceptions in Merger Agreement) only.
|
2
|
NTD: To be included for stockholders other than C-level executives, Chairman, Blanca de Porres
Guardiola, and Ardachon (subject to exceptions in Merger Agreement).
|
(iii)
|
in the case of an individual, Transfers by virtue of laws of descent and distribution upon death of the individual;
|
(iv)
|
in the case of an individual, Transfers by operation of law or pursuant to a court order, such as a qualified domestic relations
order, divorce decree or separation agreement;
|
(v)
|
in the case of an individual, Transfers to a partnership, limited liability company or other entity of which the undersigned
and/or the immediate family (as defined below) of the undersigned are the legal and beneficial owner of all of the outstanding equity securities or similar interests;
|
(vi)
|
in the case of an entity that is a trust, Transfers to a trustor or beneficiary of the trust or to the estate of a beneficiary
of such trust;
|
(vii)
|
in the case of an entity, Transfers by virtue of the laws of the state of the entity’s organization and the entity’s
organizational documents upon dissolution of the entity;
|
(viii)
|
Transfers relating to Surviving Corporation Common Stock or other securities convertible into or exercisable or exchangeable for
Surviving Corporation Common Stock acquired in open market transactions after the Closing; provided that no such transaction is required to be, or is, publicly announced (whether on Form 4, Form
5 or otherwise, other than a required filing on Schedule 13F, 13G or 13G/A) during the Lock-Up Period;
|
(ix)
|
the exercise of stock options or the vesting of stock awards of Surviving Corporation Common Stock and any related transfer of
shares of Surviving Corporation Common Stock in connection therewith (x) deemed to occur upon the “cashless” or “net” exercise of such options or (y) for the purpose of paying the exercise price of such options or for paying taxes due
as a result of the exercise of such options, the vesting of such options or stock awards, or as a result of the vesting of such shares of Surviving Corporation Common Stock, it being understood that all shares of Surviving Corporation
Common Stock received upon such exercise, vesting or transfer will remain subject to the restrictions of this Agreement during the Lock-Up Period;
|
(x)
|
Transfers to the Company pursuant to any contractual arrangement in effect at the Effective Time that provides for the
repurchase by the Company or forfeiture of Surviving Corporation Common Stock or other securities convertible into or exercisable or exchangeable for Surviving Corporation Common Stock in connection with the termination of the
Securityholder’s service to the Company;
|
(xi)
|
the entry, by a Securityholder, at any time after the Effective Time, of any trading plan providing for the sale of shares of
Surviving Corporation Common Stock by a Securityholder, which trading plan meets the requirements of Rule 10b5-1(c) under the Exchange Act; provided, however,
that such plan does not provide for, or permit, the sale of any shares of Surviving Corporation Common Stock during the Lock-Up Period and no public announcement or filing is voluntarily made or required regarding such plan during the
Lock-Up Period;
|
(xii)
|
Transfers in the event of completion of a liquidation, merger, stock exchange, reorganization or other similar transaction that
results in all of the Company’s securityholders having the right to exchange their shares of Surviving Corporation Common Stock for cash, securities or other property;
|
(xiii)
|
Transfers to satisfy any U.S. federal, state, or local income tax obligations of a Securityholder (or its direct or indirect
owners) arising from a change in the Code, or the U.S. Treasury Regulations promulgated thereunder (the “Regulations”) after the date on which the Merger Agreement was executed by the parties thereto, and such change prevents the
Merger from qualifying as a “reorganization” pursuant to Section 368 of the Code (and the Merger does not qualify for similar tax-free treatment pursuant to any successor or other provision of the Code or Regulations taking into account
such changes), in each case solely and to the extent necessary to cover any tax liability as a direct result of the transaction;
|
(xiv)
|
Transfers to satisfy any Spanish tax obligations of a Securityholder (or its direct or indirect owners) arising from a change in
the Spanish tax laws and regulations after the date on which the Merger Agreement was executed by the parties thereto, and such change prevents the
|
(xv)
|
pledges of Surviving Corporation Common Stock or other securities convertible into or exercisable or exchangeable for Surviving
Corporation Common Stock in a bona fide transaction as collateral to secure obligations pursuant to lending or other financing arrangements between a Securityholder (or its affiliates), on the one hand, and a third party, on the other
hand, for the benefit of such Securityholder and/or its affiliates.
|
|
| |
COMPANY:
|
|||
|
| |
|
|||
|
| |
|
|||
|
| |
By:
|
| |
|
|
| |
Name:
|
|||
|
| |
Title:
|
|
| |
SECURITYHOLDERS:
|
|||
|
| |
|
|||
|
| |
|
|||
|
| |
By:
|
| |
|
|
| |
Name:
|
|||
|
| |
Title:
|
1.
|
Amendments to the Merger Agreement. The Parties hereby agree that the Merger Agreement shall be deemed to be
amended as follows:
|
1.1
|
Section 1.1 of the Merger Agreement. The definition of “AVR Option Amount” in Section 1.1
of the Merger Agreement is hereby deleted in its entirety.
|
1.2
|
Section 1.1 of the Merger Agreement. The definition of “Base Purchase Price” in Section
1.1 of the Merger Agreement is hereby deleted in its entirety.
|
1.3
|
Section 1.1 of the Merger Agreement. The definition of “Capital Raise Transaction” in
Section 1.1 of the Merger Agreement is hereby deleted in its entirety and replaced by the following:
|
1.4
|
Section 1.1 of the Merger Agreement. The definition of “Closing Date Purchase Price” in
Section 1.1 of the Merger Agreement is hereby deleted in its entirety and replaced by the following:
|
1.5
|
Section 1.1 of the Merger Agreement. The definition of “Debt Raise Transaction” in Section
1.1 of the Merger Agreement is hereby deleted in its entirety.
|
1.6
|
Section 1.1 of the Merger Agreement. The definition of “Debt Transaction Pre-Money Valuation”
in Section 1.1 of the Merger Agreement is hereby deleted in its entirety.
|
1.7
|
Section 1.1 of the Merger Agreement. The definition of “Debt Transaction Pre-Money Valuation Schedule”
in Section 1.1 of the Merger Agreement is hereby deleted in its entirety.
|
1.8
|
Section 1.1 of the Merger Agreement. The definition of “Founder Consideration Shares” in
Section 1.1 of the Merger Agreement is hereby deleted in its entirety and replaced by the following:
|
1.9
|
Section 1.1 of the Merger Agreement. The definition of “Minimum Investment Amount” in
Section 1.1 of the Merger Agreement is hereby deleted in its entirety and replaced by the following:
|
1.10
|
Section 1.1 of the Merger Agreement. The definition of “Valuation Firm” in Section 1.1 of
the Merger Agreement is hereby deleted in its entirety.
|
1.11
|
Section 2.4(a) of the Merger Agreement. Section 2.4(a) of the Merger Agreement is hereby deleted in its
entirety and replaced by the following:
|
(a)
|
As soon as reasonably practicable following completion of the Capital Raise Transaction, the Company shall prepare and
deliver to Acquiror a statement setting forth the Company’s good faith calculation of the Capital Raise Amount in reasonable detail to allow Acquiror to deliver the Preliminary Closing Statement pursuant to Section 2.4(d).
|
1.12
|
Section 2.4(f) of the Merger Agreement. Section 2.4(f) of the Merger Agreement is hereby deleted in its
entirety.
|
1.13
|
Section 3.1(a) of the Merger Agreement. Section 3.1(a) of the Merger Agreement is hereby deleted in its
entirety and replaced by the following:
|
(i)
|
each share of Company Common Stock issued and outstanding immediately prior to the Effective Time (other than (1) any shares
of Company Common Stock subject to Company Options (which shall be subject to Section 3.3(a)), (2) any shares of Company Common Stock held in the treasury of the Company (each such share, a “Treasury Share”)
and (3) any Dissenting Shares (which shall be subject to Section 3.5)), shall be canceled and converted into the right to receive the applicable portion of the Aggregate Closing Date Merger Consideration as
determined pursuant to Section 3.1(b);
|
(ii)
|
each Treasury Share issued and outstanding immediately prior to the Effective Time shall be canceled as part of the Merger
and no consideration shall be paid in respect thereto;
|
(iii)
|
each share of Domesticated Acquiror Class A Stock (other than any Founder Consideration Shares that are shares of
Domesticated Acquiror Class A Stock, which shall be treated pursuant to Section 3.1(a)(iv) below) issued and outstanding immediately prior to the Effective Time shall remain as an issued and outstanding share of
Surviving Corporation Common Stock; and
|
(iv)
|
a number of shares of Acquiror Common Stock equal to the number of Founder Consideration Shares shall convert into issued and
outstanding shares of Surviving Corporation Common Stock and the remaining shares of Acquiror Common Stock issued and outstanding shall be canceled as part of the Merger and no consideration shall be paid thereof.
|
1.14
|
Section 7.10 of the Merger Agreement. Section 7.10 of the Merger Agreement is hereby deleted in its entirety
and replaced with:
|
1.15
|
Section 8.7(a) of the Merger Agreement. Section 8.7(a) of the Merger Agreement is hereby deleted in its
entirety and replaced with:
|
(a)
|
the Board of Directors of the Surviving Corporation (the “Surviving Corporation Board” shall consist of
nine (9) directors, which shall initially include:
|
(i)
|
six (6) director nominees, each of whom shall be “independent” directors for the purposes of Nasdaq, (x) five (5) of whom
shall be designated by the Company, each of whom shall be proposed by the Company pursuant to written notice to Acquiror as soon as reasonably practicable following the date of this Agreement, and (y) one (1) of whom shall be
designated by Acquiror, who shall be proposed by Acquiror pursuant to written notice to the Company as soon as reasonably practicable following the date of this Agreement;
|
(ii)
|
three (3) director nominees to be designated by the Company pursuant to written notice to Acquiror as soon as reasonably
practicable following the date of this Agreement;
|
1.16
|
Section 9.1(f) of the Merger Agreement. Section 9.1(f) of the Merger Agreement is hereby deleted in its
entirety.
|
1.17
|
Section 10.1(b)(iii) of the Merger Agreement. Section 10.1(b)(iii) of the Merger Agreement is hereby deleted in
its entirety.
|
2.
|
Acquiror Authority Relative to Amendment. Acquiror has all requisite company or corporate power and authority
to execute and deliver this Amendment. This Amendment constitutes, assuming due authorization, execution and delivery by the other Party hereto, a legal, valid and binding obligation of Acquiror, enforceable against Acquiror in
accordance with its terms, subject to any Enforceability Exceptions.
|
3.
|
Company Authority Relative to Amendment. The Company has all requisite company or corporate power and authority
to execute and deliver this Amendment. This Amendment constitutes, assuming due authorization, execution and delivery by the other Party hereto, a legal, valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, subject to any Enforceability Exceptions.
|
4.
|
Effectiveness. All of the provisions of this Amendment shall be effective as of the date of this Amendment.
Except to the extent specifically amended hereby, all of the terms of the Merger
|
5.
|
References to the Merger Agreement. After giving effect to this Amendment, each reference in the Merger
Agreement to “this Agreement”, “hereof”, “hereunder” or words of like import referring to the Merger Agreement shall refer to the Merger Agreement as amended by this Amendment, all references in the Acquiror Disclosure Letter or the
Company Disclosure Letter to “the Agreement” shall refer to the Merger Agreement as amended by this Amendment. All references in the Merger Agreement, the Acquiror Disclosure Letter or the Company Disclosure Letter to “the date
hereof” or “the date of this Agreement” shall refer to May 9, 2023.
|
6.
|
Entire Agreement. This Amendment, the Merger Agreement (including the Exhibits thereto, the Acquiror Disclosure
Letter and the Company Disclosure Letter) and the Ancillary Agreements constitute the entire agreement between the Parties with respect to the subject matter hereof and supersede all prior and contemporaneous agreements and
undertakings, both written and oral, between the Parties, or any of them, with respect to the subject matter hereof and thereof.
|
7.
|
Other Provisions. The provisions of Article XI (Miscellaneous)
of the Merger Agreement shall, to the extent not already set forth in this Amendment, apply mutatis mutandis to this Amendment, and to the Merger Agreement as modified by this
Amendment, taken together as a single agreement, reflecting the terms as modified hereby.
|
|
| |
RMG ACQUISITION CORP. III
|
||||||
|
| |
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Philip Kassim
|
|||
|
| |
|
| |
Name:
|
| |
Philip Kassin
|
|
| |
|
| |
Title:
|
| |
President and COO
|
|
| |
|
| |
|
| |
|
|
| |
H2B2 ELECTROLYSIS TECHNOLOGIES, INC.
|
||||||
|
| |
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Anselmo Andrade Fernández de Mesa
|
|||
|
| |
|
| |
Name:
|
| |
Anselmo Andrade Fernández de Mesa
|
|
| |
|
| |
Title:
|
| |
Chief Executive Officer
|
|
| |
If to Acquiror:
|
|||
|
| |
|
| |
|
|
| |
RMG Acquisition Corp. III
|
|||
|
| |
57 Ocean, Suite 403, 5775 Collins Avenue
|
|||
|
| |
Miami Beach, Florida
|
|||
|
| |
Attention:
|
| |
Philip Kassin
|
|
| |
Email:
|
| |
pkassin@rmginvestments.com
|
|
| |
|
| |
|
|
| |
with copies to (which shall not constitute notice):
|
|||
|
| |
|
| |
|
|
| |
Skadden, Arps, Slate, Meagher & Flom (UK) LLP
|
|||
|
| |
22 Bishopsgate, EC2N 4BQ London
|
|||
|
| |
Attention:
|
| |
Lorenzo Corte; Maria Protopapa
|
|
| |
Email:
|
| |
lorenzo.corte@skadden.com
|
|
| |
|
| |
maria.protopapa@skadden.com
|
|
| |
|
| |
|
|
| |
If to the Company:
|
|||
|
| |
|
| |
|
|
| |
H2B2 Electrolysis Technologies, Inc.
|
|||
|
| |
300 Delaware Ave Ste 210-A,
|
|||
|
| |
Wilmington, Delaware 19801
|
|||
|
| |
Attention:
|
| |
Anselmo Andrade and Mario Barragan
|
|
| |
Email:
|
| |
anselmo.andrade@h2b2.es and mario.barragan@h2b2.es
|
|
| |
|
| |
|
|
| |
with copies to (which shall not constitute notice):
|
|||
|
| |
|
| |
|
|
| |
Latham & Watkins LLP
|
|||
|
| |
811 Main Street, Suite 3700
|
|||
|
| |
Houston, Texas 77002
|
|||
|
| |
Attention:
|
| |
Ryan Maierson; Thomas Verity
|
|
| |
Email:
|
| |
ryan.maierson@lw.com
|
|
| |
|
| |
thomas.verity@lw.com
|
|
| |
|
| |
|
|
| |
If to the Sponsor:
|
|||
|
| |
|
| |
|
|
| |
RMG Sponsor III LLC
|
|||
|
| |
57 Ocean, Suite 403, 5775 Collins Avenue
|
|||
|
| |
Miami Beach, Florida
|
|||
|
| |
Attention:
|
| |
Philip Kassin
|
|
| |
Email:
|
| |
pkassin@rmginvestments.com
|
|
| |
|
| |
|
|
| |
with a copy to (which will not constitute notice):
|
|||
|
| |
|
| |
|
|
| |
Skadden, Arps, Slate, Meagher & Flom (UK) LLP
|
|||
|
| |
22 Bishopsgate, EC2N 4BQ London
|
|||
|
| |
Attention:
|
| |
Lorenzo Corte; Maria Protopapa
|
|
| |
Email:
|
| |
lorenzo.corte@skadden.com
|
|
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maria.protopapa@skadden.com
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SPONSOR:
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RMG Sponsor III LLC
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By:
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/s/ Philip Kassin
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Name:
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Philip Kassin
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Title:
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President and COO
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ACQUIROR:
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RMG Acquisition Corp. III
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By:
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/s/ Philip Kassim
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Name:
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Philip Kassin
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Title:
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President and COO
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COMPANY:
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H2B2 Electrolysis Technologies, Inc.
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By:
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/s/ Anselmo Andrade Fernández de Mesa
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Name:
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Anselmo Andrade Fernández de Mesa
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Title:
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Chief Executive Officer
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1.
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Securities Subscription Agreement, dated as of December 30, 2020, by and between Acquiror and Sponsor.
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2.
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Letter Agreement.
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3.
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Sponsor Warrants Purchase Agreement, dated as of February 4, 2021, by and between Acquiror and Sponsor.
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4.
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Registration Rights Agreement, dated as of February 4, 2021, by and between Acquiror and Sponsor.
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If to Acquiror:
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RMG Acquisition Corp. III
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57 Ocean, Suite 403, 5775 Collins Avenue
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Miami Beach, Florida
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Attention: Philip Kassin
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Email: pkassin@rmginvestments.com
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with copies to (which shall not constitute notice):
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Skadden, Arps, Slate, Meagher & Flom (UK) LLP
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22 Bishopsgate, EC2N 4BQ London
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Attention: Lorenzo Corte; Maria Protopapa
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Email: lorenzo.corte@skadden.com
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maria.protopapa@skadden.com
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If to the Company:
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H2B2 Electrolysis Technologies, Inc.
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300 Delaware Ave Ste 210-A
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Wilmington, DE 19801
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Attention: Anselo Andrade; Mario Barragan
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Email: anselmo.andrade@h2b2.es; mario.barragan@h2b2.es
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with copies to (which shall not constitute notice):
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Latham & Watkins LLP
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811 Main Street, Suite 3700
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Houston, Texas 77002
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Attention: Ryan Maierson; Thomas Verity
|
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Email: ryan.maierson@lw.com
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thomas.verity@lw.com
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If to a Company Stockholder
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To such Company Stockholder’s address set forth in Schedule I
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COMPANY STOCKHOLDERS:
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By:
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/s/ África Castro Rosende
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Name:
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África Castro Rosende
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COMPANY STOCKHOLDERS:
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By:
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/s/ Alejandra Benjumea de Porres
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Name:
|
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Alejandra Benjumea de Porres
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COMPANY STOCKHOLDERS:
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By:
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/s/ Anselmo Andrade Fernández de Mesa
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Name:
|
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Anselmo Andrade Fernández de Mesa
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COMPANY STOCKHOLDERS:
|
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By:
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/s/ Anselmo Andrade Rodríguez
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Name:
|
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Anselmo Andrade Rodríguez
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COMPANY STOCKHOLDERS:
|
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By:
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/s/ Blanca Benjumea de Porres
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Name:
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Blanca Benjumea de Porres
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COMPANY STOCKHOLDERS:
|
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By:
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/s/ Blanca de Porres Guardiola
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Name:
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Blanca de Porres Guardiola
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COMPANY STOCKHOLDERS:
|
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By:
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/s/ Carla Benjumea de Porres
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Name:
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Carla Benjumea de Porres
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COMPANY STOCKHOLDERS:
|
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By:
|
| |
/s/ Carlos Sundheim Losada
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Name:
|
| |
Carlos Sundheim Losada
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COMPANY STOCKHOLDERS:
|
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By:
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/s/ Covadonga García Gómez
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Name:
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Covadonga García Gómez
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|
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COMPANY STOCKHOLDERS:
|
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By:
|
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/s/ Delia Muñoz Alé
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Name:
|
| |
Delia Muñoz Alé
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|
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COMPANY STOCKHOLDERS:
|
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By:
|
| |
/s/ José Javier Brey Sánchez
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|
| |
Name:
|
| |
José Javier Brey Sánchez as CEO of
Empelia Capital S.L.
|
|
| |
COMPANY STOCKHOLDERS:
|
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| |
|
| |
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By:
|
| |
/s/ Enrique Barrientos García
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|
| |
Name:
|
| |
Enrique Barrientos García
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|
| |
COMPANY STOCKHOLDERS:
|
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| |
|
| |
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By:
|
| |
/s/ Felipe Benjumea de Porres
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Name:
|
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Felipe Benjumea de Porres
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|
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COMPANY STOCKHOLDERS:
|
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|
| |
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By:
|
| |
/s/ José Javier Brey Sánchez
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|
| |
Name:
|
| |
José Javier Brey Sánchez as President of Fundación para la Promoción de los
Microemprendimientos
|
|
| |
COMPANY STOCKHOLDERS:
|
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|
| |
|
| |
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| |
By:
|
| |
/s/ José Antonio Vázquez Arjona
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|
| |
Name:
|
| |
José Antonio Vázquez Arjona
|
|
| |
COMPANY STOCKHOLDERS:
|
|||
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Juan Suarez Ávila
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|
| |
Name:
|
| |
Juan Suarez Ávila
|
|
| |
COMPANY STOCKHOLDERS:
|
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|
| |
|
| |
|
|
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By:
|
| |
/s/ Luján Aresti Llorente
|
|
| |
Name:
|
| |
Luján Aresti Llorente
|
|
| |
COMPANY STOCKHOLDERS:
|
|||
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ María Concepción Guardiola Domínguez
|
|
| |
Name:
|
| |
María Concepción Guardiola Domínguez
|
|
| |
COMPANY STOCKHOLDERS:
|
|||
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Guillermo Delclaux Lezama-Leguizamón
|
|
| |
Name:
|
| |
Guillermo Delclaux Lezama-Leguizamón
As legal representative of Onatrium H2 S.L.
|
|
| |
COMPANY STOCKHOLDERS:
|
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|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Roberto Wilson Fernández del Castillo
|
|
| |
Name:
|
| |
Roberto Wilson Fernández del Castillo
|
|
| |
ACQUIROR:
|
||||||
|
| |
|
| |
|
| |
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|
| |
RMG Acquisition Corp. III
|
||||||
|
| |
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Philip Kassin
|
|||
|
| |
|
| |
Name:
|
| |
Philip Kassin
|
|
| |
|
| |
Title:
|
| |
President and COO
|
|
| |
COMPANY:
|
||||||
|
| |
|
| |
|
| |
|
|
| |
H2B2 Electrolysis Technologies, Inc.
|
||||||
|
| |
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Anselmo Andrade Fernández de Mesa
|
|||
|
| |
|
| |
Name:
|
| |
Anselmo Andrade Fernández de Mesa
|
|
| |
|
| |
Title:
|
| |
Chief Executive Officer
|
|
Company Stockholder
|
| |
Shares of Company
Common Stock
|
|
|
África Castro Rosende
|
| |
227,228
|
|
|
Alejandra Benjumea de Porres
|
| |
956
|
|
|
Anselmo Andrade Fernández de Mesa
|
| |
39,050
|
|
|
Anselmo Andrade Rodríguez
|
| |
54,821
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|
|
Blanca Benjumea de Porres
|
| |
52,000
|
|
|
Blanca de Porres Guardiola
|
| |
799,598
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|
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Carla Benjumea de Porres
|
| |
4,188
|
|
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Carlos Sundheim Losada
|
| |
82,918
|
|
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Covadonga García Gómez
|
| |
202,508
|
|
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Delia Muñoz Alé
|
| |
25,510
|
|
|
Empelia Capital, SL
|
| |
768,078
|
|
|
Enrique Barrientos García
|
| |
4,136
|
|
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Felipe Benjumea de Porres
|
| |
38,688
|
|
|
Fundación para la Promoción de los Microemprendimientos
|
| |
57,679
|
|
|
José Antonio Vázquez Arjona
|
| |
4,060
|
|
|
Juan Suarez Ávila
|
| |
55,619
|
|
|
Luján Aresti Llorente
|
| |
657,337
|
|
|
María Concepción Guardiola Domínguez
|
| |
554,743
|
|
|
Onatrium H2, S.L.
|
| |
2,223,276
|
|
|
Roberto Wilson Fernández del Castillo
|
| |
1,219
|
|
|
| |
COMPANY:
|
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, a Delaware corporation
|
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By:
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Name:
|
| |
|
|
| |
Title:
|
| |
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|
| |
HOLDERS:
|
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|
| |
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|
| |
RMG SPONSOR III LLC, a
Delaware limited liability company
|
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| |
|
| |
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By:
|
| |
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Name:
|
| |
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|
| |
Title:
|
| |
|
|
| |
|
|
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Name:
|
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|
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|
| |
Signature of Stockholder
|
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|
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|
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Print Name of Stockholder
|
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|
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|
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Its:
|
| |
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Address:
|
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|
| |
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Agreed and Accepted as of
|
| |
|
|||
, 20
|
| |
|
|||
|
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By:
|
| |
|
| |
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Name:
|
| |
|
| |
|
Its:
|
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|
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|
|
H2B2 Holders
|
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2.
|
The restrictions set forth in Section 1 shall not apply to:
|
(i)
|
in the case of an entity, Transfers (A) to another entity that is an affiliate (as defined in Rule 405 promulgated under the
Securities Act) of the undersigned, or to any investment fund or other entity controlling, controlled by, managing or managed by or under common control with the undersigned or affiliates of the undersigned or who shares a common
investment advisor with the undersigned or (B) as part of a distribution to members, partners, shareholders or equity holders of the undersigned;
|
(ii)
|
in the case of an individual, Transfers by gift to members of the individual’s immediate family (as defined below) or to a
trust, the beneficiary of which is a member of one of the individual’s immediate family, an affiliate of such person or to a charitable organization;
|
1
|
NTD: To be included for C-level executives of the Company, Chairman, Blanca de Porres Guardiola,
and Ardachon (subject to exceptions in Merger Agreement) only
|
2
|
NTD: To be included for stockholders other than C-level executives, Chairman, Blanca de Porres
Guardiola, and Ardachon (subject to exceptions in Merger Agreement).
|
(iii)
|
in the case of an individual, Transfers by virtue of laws of descent and distribution upon death of the individual;
|
(iv)
|
in the case of an individual, Transfers by operation of law or pursuant to a court order, such as a qualified domestic relations
order, divorce decree or separation agreement;
|
(v)
|
in the case of an individual, Transfers to a partnership, limited liability company or other entity of which the undersigned
and/or the immediate family (as defined below) of the undersigned are the legal and beneficial owner of all of the outstanding equity securities or similar interests;
|
(vi)
|
in the case of an entity that is a trust, Transfers to a trustor or beneficiary of the trust or to the estate of a beneficiary
of such trust;
|
(vii)
|
in the case of an entity, Transfers by virtue of the laws of the state of the entity’s organization and the entity’s
organizational documents upon dissolution of the entity;
|
(viii)
|
Transfers relating to Surviving Corporation Common Stock or other securities convertible into or exercisable or exchangeable for
Surviving Corporation Common Stock acquired in open market transactions after the Closing; provided that no such transaction is required to be, or is, publicly announced (whether on Form 4, Form
5 or otherwise, other than a required filing on Schedule 13F, 13G or 13G/A) during the Lock-Up Period;
|
(ix)
|
the exercise of stock options or the vesting of stock awards of Surviving Corporation Common Stock and any related transfer of
shares of Surviving Corporation Common Stock in connection therewith (x) deemed to occur upon the “cashless” or “net” exercise of such options or (y) for the purpose of paying the exercise price of such options or for paying taxes due
as a result of the exercise of such options, the vesting of such options or stock awards, or as a result of the vesting of such shares of Surviving Corporation Common Stock, it being understood that all shares of Surviving Corporation
Common Stock received upon such exercise, vesting or transfer will remain subject to the restrictions of this Agreement during the Lock-Up Period;
|
(x)
|
Transfers to the Company pursuant to any contractual arrangement in effect at the Effective Time that provides for the
repurchase by the Company or forfeiture of Surviving Corporation Common Stock or other securities convertible into or exercisable or exchangeable for Surviving Corporation Common Stock in connection with the termination of the
Securityholder’s service to the Company;
|
(xi)
|
the entry, by a Securityholder, at any time after the Effective Time, of any trading plan providing for the sale of shares of
Surviving Corporation Common Stock by a Securityholder, which trading plan meets the requirements of Rule 10b5-1(c) under the Exchange Act; provided, however,
that such plan does not provide for, or permit, the sale of any shares of Surviving Corporation Common Stock during the Lock-Up Period and no public announcement or filing is voluntarily made or required regarding such plan during the
Lock-Up Period;
|
(xii)
|
Transfers in the event of completion of a liquidation, merger, stock exchange, reorganization or other similar transaction that
results in all of the Company’s securityholders having the right to exchange their shares of Surviving Corporation Common Stock for cash, securities or other property;
|
(xiii)
|
Transfers to satisfy any U.S. federal, state, or local income tax obligations of a Securityholder (or its direct or indirect
owners) arising from a change in the Code, or the U.S. Treasury Regulations promulgated thereunder (the “Regulations”) after the date on which the Merger Agreement was executed by the parties thereto, and such change prevents the
Merger from qualifying as a “reorganization” pursuant to Section 368 of the Code (and the Merger does not qualify for similar tax-free treatment pursuant to any successor or other provision of the Code or Regulations taking into account
such changes), in each case solely and to the extent necessary to cover any tax liability as a direct result of the transaction;
|
(xiv)
|
Transfers to satisfy any Spanish tax obligations of a Securityholder (or its direct or indirect owners) arising from a change in
the Spanish tax laws and regulations after the date on which the Merger Agreement was executed by the parties thereto, and such change prevents the Merger from qualifying for the regime set forth under Title VII, Chapter VII of the
Spanish Law 27/209014, Corporate Income Tax Law (and the Merger does not qualify for similar tax-free treatment pursuant to any successor or other provision of such Law or regulations thereunder taking into account such changes), in
each case solely and to the extent necessary to cover any tax liability as a direct result of the transaction; and
|
(xv)
|
pledges of Surviving Corporation Common Stock or other securities convertible into or exercisable or exchangeable for Surviving
Corporation Common Stock in a bona fide transaction as collateral to secure obligations pursuant to lending or other financing arrangements between a Securityholder (or its affiliates), on the one hand, and a third party, on the other
hand, for the benefit of such Securityholder and/or its affiliates.
|
|
| |
COMPANY:
|
|||
|
| |
|
|||
|
| |
|
|||
|
| |
By:
|
| |
|
|
| |
Name:
|
|||
|
| |
Title:
|
|
| |
SECURITYHOLDERS:
|
|||
|
| |
|
|||
|
| |
|
|||
|
| |
By:
|
| |
|
|
| |
Name:
|
|||
|
| |
Title:
|
(1)
|
The name of the Company is RMG Acquisition Corp. III.
|
(2)
|
The Registered Office of the Company shall be at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House,
Grand Cayman, KY1-1104, Cayman Islands, or at such other place within the Cayman Islands as the Directors may decide.
|
(3)
|
The objects for which the Company is established are unrestricted and the Company shall have full power and authority to carry
out any object not prohibited by the laws of the Cayman Islands.
|
(4)
|
The liability of each Member is limited to the amount unpaid on such Member’s shares.
|
(5)
|
The share capital of the Company is US$ 55,500 divided into 500,000,000 Class A ordinary shares of a par value of US$0.0001
each, 50,000,000 Class B ordinary shares of a par value of US$0.0001 each and 5,000,000 preference shares of a par value of US$0.0001 each.
|
(6)
|
The Company has power to register by way of continuation as a body corporate limited by shares under the laws of any
jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands.
|
(7)
|
Capitalised terms that are not defined in this Third Amended and Restated Memorandum of Association bear the respective meanings
given to them in the Third Amended and Restated Articles of Association of the Company.
|
1.
|
INTERPRETATION
|
1.1
|
In the Articles Table A in the First Schedule to the Statute does not apply and, unless there is something in the subject or
context inconsistent therewith:
|
“Affiliate”
|
| |
in respect of a person, means any other person that, directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under common control with, such person, and (a) in the case of a natural person, shall include, without limitation, such person’s spouse, parents, children, siblings,
mother in law and father in law and brothers and sisters in law, whether by blood, marriage or adoption or anyone residing in such person’s home, a trust for the benefit of any of the foregoing, a company, partnership or any natural
person or entity wholly or jointly owned by any of the foregoing and (b) in the case of an entity, shall include a partnership, a corporation or any natural person or entity which directly, or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with, such entity.
|
|
| |
|
“Applicable Law”
|
| |
means, with respect to any person, all provisions of laws, statutes,
ordinances, rules, regulations, permits, certificates, judgments, decisions, decrees or orders of any governmental authority applicable to such person.
|
|
| |
|
“Articles”
|
| |
means these third amended and restated articles of association of the Company.
|
|
| |
|
“Audit Committee”
|
| |
means the audit committee of the board of directors of the Company established
pursuant to the Articles, or any successor committee.
|
|
| |
|
“Auditor”
|
| |
means the person for the time being performing the duties of auditor of the
Company (if any).
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| |
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“Business Combination”
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| |
means a merger, amalgamation, share exchange, asset acquisition, share
purchase, reorganisation or similar business combination involving the Company, with one or more businesses or entities (the “target business”), which Business Combination: (a) as long as the securities of the Company are listed on the
Nasdaq Capital Market., must occur with one or more target businesses that together have an aggregate fair market value of at least 80 per cent of the assets held in the Trust Account (excluding the
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|
| |
deferred underwriting commissions and taxes payable on the income earned on the
Trust Account at the time of the signing of the definitive agreement to enter into such Business Combination); and (b) must not be solely effectuated with another blank cheque company or a similar company with nominal operations.
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| |
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“business day”
|
| |
means any day other than a Saturday, a Sunday or a legal holiday or a day on
which banking institutions or trust companies are authorised or obligated by law to close in New York City.
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| |
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“Clearing House”
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| |
means a clearing house recognised by the laws of the jurisdiction in which the
Shares (or depositary receipts therefor) are listed or quoted on a stock exchange or interdealer quotation system in such jurisdiction.
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| |
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“Class A Share”
|
| |
means a Class A ordinary share of a par value of US$0.0001 in the share capital
of the Company.
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| |
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“Class B Share”
|
| |
means a Class B ordinary share of a par value of US$0.0001 in the share capital
of the Company.
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| |
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“Company”
|
| |
means the above named company.
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| |
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“Company’s Website”
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| |
means the website of the Company and/or its web address or domain name (if
any).
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| |
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“Compensation Committee”
|
| |
means the compensation committee of the board of directors of the Company
established pursuant to the Articles, or any successor committee.
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| |
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“Designated Stock Exchange”
|
| |
means any United States national securities exchange on which the securities of
the Company are listed for trading, including the Nasdaq Capital Market.
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“Directors”
|
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means the directors for the time being of the Company.
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“Dividend”
|
| |
means any dividend (whether interim or final) resolved to be paid on Shares
pursuant to the Articles.
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“Electronic Communication”
|
| |
means a communication sent by electronic means, including electronic posting to
the Company’s Website, transmission to any number, address or internet website (including the website of the Securities and Exchange Commission) or other electronic delivery methods as otherwise decided and approved by the Directors.
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| |
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“Electronic Record”
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has the same meaning as in the Electronic Transactions Act.
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“Electronic Transactions Act”
|
| |
means the Electronic Transactions Act (As Revised) of the Cayman Islands.
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“Equity linked Securities”
|
| |
means any debt or equity securities that are convertible, exercisable or
exchangeable for Class A Shares issued in a financing transaction in connection with a Business Combination,
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| |
including but not limited to a private placement of equity or debt.
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“Exchange Act”
|
| |
means the United States Securities Exchange Act of 1934, as amended, or any
similar U.S. federal statute and the rules and regulations of the Securities and Exchange Commission thereunder, all as the same shall be in effect at the time.
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“Founders”
|
| |
means all Members immediately prior to the consummation of the IPO.
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“Independent Director”
|
| |
has the same meaning as in the rules and regulations of the Designated Stock
Exchange or in Rule 10A-3 under the Exchange Act, as the case may be.
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| |
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“IPO”
|
| |
means the Company’s initial public offering of securities.
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| |
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“Member”
|
| |
has the same meaning as in the Statute.
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| |
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“Memorandum”
|
| |
means the third amended and restated memorandum of association of the Company,
as amended or substituted from time to time.
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| |
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“Nominating and Corporate Governance Committee”
|
| |
means the nominating and corporate governance committee of the board of
directors of the Company established pursuant to the Articles, or any successor committee.
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| |
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“Officer”
|
| |
means a person appointed to hold an office in the Company.
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| |
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“Ordinary Resolution”
|
| |
means a resolution passed by a simple majority of the Members as, being
entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting, and includes a unanimous written resolution. In computing the majority when a poll is demanded regard shall be had to the number of votes to
which each Member is entitled by the Articles.
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| |
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“Ordinary Share”
|
| |
means an ordinary share of a par value of US$0.0001 in the share capital of the
Company.
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| |
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“Over-Allotment Option”
|
| |
means the option of the Underwriters to purchase up to an additional 15 per
cent of the firm units (as described in the Articles) issued in the IPO at a price equal to US$10 per unit, less underwriting discounts and commissions.
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| |
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“Preference Share”
|
| |
means a preference share of a par value of US$0.0001 in the share capital of
the Company.
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| |
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“Public Share”
|
| |
means a Class A Share issued as part of the units (as described in the
Articles) issued in the IPO.
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|
| |
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“Redemption Notice”
|
| |
means a notice in a form approved by the Company by which a holder of Public
Shares is entitled to require the Company to redeem its Public Shares, subject to any conditions contained therein.
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| |
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“Register of Members”
|
| |
means the register of Members maintained in accordance with the Statute and
includes (except where otherwise stated) any branch or duplicate register of Members.
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| |
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“Registered Office”
|
| |
means the registered office for the time being of the Company.
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| |
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“Representative”
|
| |
means a representative of the Underwriters.
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| |
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“Seal”
|
| |
means the common seal of the Company and includes every duplicate seal.
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| |
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“Securities and Exchange Commission”
|
| |
means the United States Securities and Exchange Commission.
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| |
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“Share”
|
| |
means a Class A Share, a Class B Share or a Preference Share and includes a
fraction of a share in the Company.
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| |
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“Special Resolution”
|
| |
has the same meaning as in the Statute, and includes a unanimous written
resolution.
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| |
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“Sponsor”
|
| |
means RMG Sponsor III, LLC, a Delaware limited liability company, and its
successors or assigns.
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| |
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“Statute”
|
| |
means the Companies Act (As Revised) of the Cayman Islands.
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| |
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“Treasury Share”
|
| |
means a Share held in the name of the Company as a treasury share in accordance
with the Statute.
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| |
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“Trust Account”
|
| |
means the trust account established by the Company upon the consummation of its
IPO and into which a certain amount of the net proceeds of the IPO, together with a certain amount of the proceeds of a private placement of warrants simultaneously with the closing date of the IPO, will be deposited.
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| |
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“Underwriter”
|
| |
means an underwriter of the IPO from time to time and any successor
underwriter.
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1.2
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In the Articles:
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(a)
|
words importing the singular number include the plural number and vice versa;
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(b)
|
words importing the masculine gender include the feminine gender;
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(c)
|
words importing persons include corporations as well as any other legal or natural person;
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(d)
|
“written” and “in writing” include all modes of representing or reproducing words in visible form, including in the form of an
Electronic Record;
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(e)
|
“shall” shall be construed as imperative and “may” shall be construed as permissive;
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(f)
|
references to provisions of any law or regulation shall be construed as references to those provisions as amended, modified,
re-enacted or replaced;
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(g)
|
any phrase introduced by the terms “including”, “include”, “in particular” or any similar expression shall be construed as
illustrative and shall not limit the sense of the words preceding those terms;
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(h)
|
the term “and/or” is used herein to mean both “and” as well as “or.” The use of “and/or” in
|
(i)
|
headings are inserted for reference only and shall be ignored in construing the Articles;
|
(j)
|
any requirements as to delivery under the Articles include delivery in the form of an Electronic Record;
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(k)
|
any requirements as to execution or signature under the Articles including the execution of the Articles themselves can be
satisfied in the form of an electronic signature as defined in the Electronic Transactions Act;
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(l)
|
sections 8 and 19(3) of the Electronic Transactions Act shall not apply;
|
(m)
|
the term “clear days” in relation to the period of a notice means that period excluding the day when the notice is received or
deemed to be received and the day for which it is given or on which it is to take effect; and
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(n)
|
the term “holder” in relation to a Share means a person whose name is entered in the Register of Members as the holder of such
Share.
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2.
|
COMMENCEMENT OF BUSINESS
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2.1
|
The business of the Company may be commenced as soon after incorporation of the Company as the Directors shall see fit.
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2.2
|
The Directors may pay, out of the capital or any other monies of the Company, all expenses incurred in or about the formation
and establishment of the Company, including the expenses of registration.
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3.
|
ISSUE OF SHARES AND OTHER SECURITIES
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3.1
|
Subject to the provisions, if any, in the Memorandum (and to any direction that may be given by the Company in general meeting)
and, where applicable, the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law, and without prejudice to any
rights attached to any existing Shares, the Directors may allot, issue, grant options over or otherwise dispose of Shares (including fractions of a Share) with or without preferred, deferred or other rights or restrictions, whether in
regard to Dividends or other distributions, voting, return of capital or otherwise and to such persons, at such times and on such other terms as they think proper, and may also (subject to the Statute and the Articles) vary such rights,
save that the Directors shall not allot, issue, grant options over or otherwise dispose of Shares (including fractions of a Share) to the extent that it may affect the ability of the Company to carry out a Class B Share Conversion set
out in the Articles.
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3.2
|
The Company may issue rights, options, warrants or convertible securities or securities of similar nature conferring the right
upon the holders thereof to subscribe for, purchase or receive any class of Shares or other securities in the Company on such terms as the Directors may from time to time determine.
|
3.3
|
The Company may issue units of securities in the Company, which may be comprised of whole or fractional Shares, rights, options,
warrants or convertible securities or securities of similar nature conferring the right upon the holders thereof to subscribe for, purchase or receive any class of Shares or other securities in the Company, upon such terms as the
Directors may from time to time determine.
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3.4
|
The Company shall not issue Shares to bearer.
|
4.
|
REGISTER OF MEMBERS
|
4.1
|
The Company shall maintain or cause to be maintained the Register of Members in accordance with the Statute.
|
4.2
|
The Directors may determine that the Company shall maintain one or more branch registers of
|
5.
|
CLOSING REGISTER OF MEMBERS OR FIXING RECORD DATE
|
5.1
|
For the purpose of determining Members entitled to notice of, or to vote at any meeting of Members or any adjournment thereof,
or Members entitled to receive payment of any Dividend or other distribution, or in order to make a determination of Members for any other purpose, the Directors may, after notice has been given by advertisement in an appointed
newspaper or any other newspaper or by any other means in accordance with the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise
under Applicable Law, provide that the Register of Members shall be closed for transfers for a stated period which shall not in any case exceed forty days.
|
5.2
|
In lieu of, or apart from, closing the Register of Members, the Directors may fix in advance or arrears a date as the record
date for any such determination of Members entitled to notice of, or to vote at any meeting of the Members or any adjournment thereof, or for the purpose of determining the Members entitled to receive payment of any Dividend or other
distribution, or in order to make a determination of Members for any other purpose.
|
5.3
|
If the Register of Members is not so closed and no record date is fixed for the determination of Members entitled to notice of,
or to vote at, a meeting of Members or Members entitled to receive payment of a Dividend or other distribution, the date on which notice of the meeting is sent or the date on which the resolution of the Directors resolving to pay such
Dividend or other distribution is passed, as the case may be, shall be the record date for such determination of Members. When a determination of Members entitled to vote at any meeting of Members has been made as provided in this
Article, such determination shall apply to any adjournment thereof.
|
6.
|
CERTIFICATES FOR SHARES
|
6.1
|
A Member shall only be entitled to a share certificate if the Directors resolve that share certificates shall be issued. Share
certificates representing Shares, if any, shall be in such form as the Directors may determine. Share certificates shall be signed by one or more Directors or other person authorised by the Directors. The Directors may authorise
certificates to be issued with the authorised signature(s) affixed by mechanical process. All certificates for Shares shall be consecutively numbered or otherwise identified and shall specify the Shares to which they relate. All
certificates surrendered to the Company for transfer shall be cancelled and, subject to the Articles, no new certificate shall be issued until the former certificate representing a like number of relevant Shares shall have been
surrendered and cancelled.
|
6.2
|
The Company shall not be bound to issue more than one certificate for Shares held jointly by more than one person and delivery
of a certificate to one joint holder shall be a sufficient delivery to all of them.
|
6.3
|
If a share certificate is defaced, worn out, lost or destroyed, it may be renewed on such terms (if any) as to evidence and
indemnity and on the payment of such expenses reasonably incurred by the Company in investigating evidence, as the Directors may prescribe, and (in the case of defacement or wearing out) upon delivery of the old certificate.
|
6.4
|
Every share certificate sent in accordance with the Articles will be sent at the risk of the Member or other person entitled to
the certificate. The Company will not be responsible for any share certificate lost or delayed in the course of delivery.
|
6.5
|
Share certificates shall be issued within the relevant time limit as prescribed by the Statute, if applicable, or as the rules
and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law may from time to time determine, whichever is shorter, after the
allotment or, except in the case of a Share transfer which the Company is for the time being entitled to refuse to register and does not register, after lodgement of a Share transfer with the Company.
|
7.
|
TRANSFER OF SHARES
|
7.1
|
Subject to the terms of the Articles, any Member may transfer all or any of his Shares by an instrument of transfer provided
that such transfer complies with the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law. If the Shares in
question were issued in conjunction with rights, options, warrants or units issued pursuant to the Articles on terms that one cannot be transferred without the other, the Directors shall refuse to register the transfer of any such Share
without evidence satisfactory to them of the like transfer of such option, warrant or unit.
|
7.2
|
The instrument of transfer of any Share shall be in writing in the usual or common form or in a form prescribed by the rules and
regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law or in any other form approved by the Directors and shall be executed
by or on behalf of the transferor (and if the Directors so require, signed by or on behalf of the transferee) and may be under hand or, if the transferor or transferee is a Clearing House or its nominee(s), by hand or by machine
imprinted signature or by such other manner of execution as the Directors may approve from time to time. The transferor shall be deemed to remain the holder of a Share until the name of the transferee is entered in the Register of
Members.
|
8.
|
REDEMPTION, REPURCHASE AND SURRENDER OF SHARES
|
8.1
|
Subject to the provisions of the Statute, and, where applicable, the rules and regulations of the Designated Stock Exchange, the
Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law, the Company may issue Shares that are to be redeemed or are liable to be redeemed at the option of the Member or the
Company. The redemption of such Shares, except Public Shares, shall be effected in such manner and upon such other terms as the Company may, by Special Resolution, determine before the issue of such Shares. With respect to redeeming or
repurchasing the Shares:
|
(a)
|
Members who hold Public Shares are entitled to request the redemption of such Shares in the circumstances described in the
Business Combination Article hereof;
|
(b)
|
Class B Shares held by the Sponsor shall be surrendered by the Sponsor for no consideration to the extent that the
Over-Allotment Option is not exercised in full so that the number of Class B Shares in issue will equal 20 per cent of the Company’s issued Shares after the IPO (exclusive of any securities purchased in a private placement
simultaneously with the IPO); and
|
(c)
|
Public Shares shall be repurchased by way of tender offer in the circumstances set out in the Business Combination
Article hereof.
|
8.2
|
Subject to the provisions of the Statute, and, where applicable, the rules and regulations of the Designated Stock Exchange, the
Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law, the Company may purchase its own Shares (including any redeemable Shares) in such manner and on such other terms as
the Directors may agree with the relevant Member. For the avoidance of doubt, redemptions, repurchases and surrenders of Shares in the circumstances described in the Article above shall not require further approval of the Members.
|
8.3
|
The Company may make a payment in respect of the redemption or purchase of its own Shares in any manner permitted by the
Statute, including out of capital.
|
8.4
|
The Directors may accept the surrender for no consideration of any fully paid Share.
|
9.
|
TREASURY SHARES
|
9.1
|
The Directors may, prior to the purchase, redemption or surrender of any Share, determine that such Share shall be held as a
Treasury Share.
|
9.2
|
The Directors may determine to cancel a Treasury Share or transfer a Treasury Share on such terms as they think proper
(including, without limitation, for nil consideration).
|
10.
|
VARIATION OF RIGHTS OF SHARES
|
10.1
|
Subject to Article 3.1, if at any time the share capital of the Company is divided into different classes of Shares, all or any
of the rights attached to any class (unless otherwise provided by the terms of issue of the Shares of that class) may, whether or not the Company is being wound up, be varied without the consent of the holders of the issued Shares of
that class where such variation is considered by the Directors not to have a material adverse effect upon such rights; otherwise, any such variation shall be made only with the consent in writing of the holders of not less than two
thirds of the issued Shares of that class (other than with respect to a waiver of the provisions of the Class B Share Conversion Article hereof, which as stated therein shall only require the consent in writing of the holders of a
majority of the issued Shares of that class), or with the approval of a resolution passed by a majority of not less than two thirds of the votes cast at a separate meeting of the holders of the Shares of that class. For the avoidance of
doubt, the Directors reserve the right, notwithstanding that any such variation may not have a material adverse effect, to obtain consent from the holders of Shares of the relevant class. To any such meeting all the provisions of the
Articles relating to general meetings shall apply mutatis mutandis, except that the necessary quorum shall be one person holding or representing by proxy at least one third of the issued Shares
of the class and that any holder of Shares of the class present in person or by proxy may demand a poll.
|
10.2
|
For the purposes of a separate class meeting, the Directors may treat two or more or all the classes of Shares as forming one
class of Shares if the Directors consider that such class of Shares would be affected in the same way by the proposals under consideration, but in any other case shall treat them as separate classes of Shares.
|
10.3
|
The rights conferred upon the holders of the Shares of any class issued with preferred or other rights shall not, unless
otherwise expressly provided by the terms of issue of the Shares of that class, be deemed to be varied by the creation or issue of further Shares ranking pari passu therewith or Shares issued with preferred or other rights.
|
11.
|
COMMISSION ON SALE OF SHARES
|
12.
|
NON RECOGNITION OF TRUSTS
|
13.
|
LIEN ON SHARES
|
13.1
|
The Company shall have a first and paramount lien on all Shares (whether fully paid-up or not) registered in the name of a
Member (whether solely or jointly with others) for all debts, liabilities or engagements to or with the Company (whether presently payable or not) by such Member or his estate, either alone or jointly with any other person, whether a
Member or not, but the Directors may at any time declare any Share to be wholly or in part exempt from the provisions of this Article. The registration of a transfer of any such Share shall operate as a waiver of the Company’s lien
thereon. The Company’s lien on a Share shall also extend to any amount payable in respect of that Share.
|
13.2
|
The Company may sell, in such manner as the Directors think fit, any Shares on which the Company has a lien, if a sum in respect
of which the lien exists is presently payable, and is not paid within fourteen clear days after notice has been received or deemed to have been received by the holder of the Shares, or to the person entitled to it in consequence of the
death or bankruptcy of the holder, demanding payment and stating that if the notice is not complied with the Shares may be sold.
|
13.3
|
To give effect to any such sale the Directors may authorise any person to execute an instrument of transfer of the Shares sold
to, or in accordance with the directions of, the purchaser. The purchaser or his nominee shall be registered as the holder of the Shares comprised in any such transfer, and he shall not be bound to see to the application of the purchase
money, nor shall his title to the Shares be affected by any irregularity or invalidity in the sale or the exercise of the Company’s power of sale under the Articles.
|
13.4
|
The net proceeds of such sale after payment of costs, shall be applied in payment of such part of the amount in respect of which
the lien exists as is presently payable and any balance shall (subject to a like lien for sums not presently payable as existed upon the Shares before the sale) be paid to the person entitled to the Shares at the date of the sale.
|
14.
|
CALL ON SHARES
|
14.1
|
Subject to the terms of the allotment and issue of any Shares, the Directors may make calls upon the Members in respect of any
monies unpaid on their Shares (whether in respect of par value or premium), and each Member shall (subject to receiving at least fourteen clear days’ notice specifying the time or times of payment) pay to the Company at the time or
times so specified the amount called on the Shares. A call may be revoked or postponed, in whole or in part, as the Directors may determine. A call may be required to be paid by instalments. A person upon whom a call is made shall
remain liable for calls made upon him notwithstanding the subsequent transfer of the Shares in respect of which the call was made.
|
14.2
|
A call shall be deemed to have been made at the time when the resolution of the Directors authorising such call was passed.
|
14.3
|
The joint holders of a Share shall be jointly and severally liable to pay all calls in respect thereof.
|
14.4
|
If a call remains unpaid after it has become due and payable, the person from whom it is due shall pay interest on the amount
unpaid from the day it became due and payable until it is paid at such rate as the Directors may determine (and in addition all expenses that have been incurred by the Company by reason of such non-payment), but the Directors may waive
payment of the interest or expenses wholly or in part.
|
14.5
|
An amount payable in respect of a Share on issue or allotment or at any fixed date, whether on account of the par value of the
Share or premium or otherwise, shall be deemed to be a call and if it is not paid all the provisions of the Articles shall apply as if that amount had become due and payable by virtue of a call.
|
14.6
|
The Directors may issue Shares with different terms as to the amount and times of payment of calls, or the interest to be paid.
|
14.7
|
The Directors may, if they think fit, receive an amount from any Member willing to advance all or any part of the monies
uncalled and unpaid upon any Shares held by him, and may (until the amount would otherwise become payable) pay interest at such rate as may be agreed upon between the Directors and the Member paying such amount in advance.
|
14.8
|
No such amount paid in advance of calls shall entitle the Member paying such amount to any portion of a Dividend or other
distribution payable in respect of any period prior to the date upon which such amount would, but for such payment, become payable.
|
15.
|
FORFEITURE OF SHARES
|
15.1
|
If a call or instalment of a call remains unpaid after it has become due and payable the Directors may give to the person from
whom it is due not less than fourteen clear days’ notice requiring payment of the amount unpaid together with any interest which may have accrued and any expenses incurred by the Company by reason of such non-payment. The notice shall
specify where payment is to be made and shall state that if the notice is not complied with the Shares in respect of which the call was made will be liable to be forfeited.
|
15.2
|
If the notice is not complied with, any Share in respect of which it was given may, before the payment
|
15.3
|
A forfeited Share may be sold, re-allotted or otherwise disposed of on such terms and in such manner as the Directors think fit
and at any time before a sale, re-allotment or disposition the forfeiture may be cancelled on such terms as the Directors think fit. Where for the purposes of its disposal a forfeited Share is to be transferred to any person the
Directors may authorise some person to execute an instrument of transfer of the Share in favour of that person.
|
15.4
|
A person any of whose Shares have been forfeited shall cease to be a Member in respect of them and shall surrender to the
Company for cancellation the certificate for the Shares forfeited and shall remain liable to pay to the Company all monies which at the date of forfeiture were payable by him to the Company in respect of those Shares together with
interest at such rate as the Directors may determine, but his liability shall cease if and when the Company shall have received payment in full of all monies due and payable by him in respect of those Shares.
|
15.5
|
A certificate in writing under the hand of one Director or Officer that a Share has been forfeited on a specified date shall be
conclusive evidence of the facts stated in it as against all persons claiming to be entitled to the Share. The certificate shall (subject to the execution of an instrument of transfer) constitute a good title to the Share and the person
to whom the Share is sold or otherwise disposed of shall not be bound to see to the application of the purchase money, if any, nor shall his title to the Share be affected by any irregularity or invalidity in the proceedings in
reference to the forfeiture, sale or disposal of the Share.
|
15.6
|
The provisions of the Articles as to forfeiture shall apply in the case of non payment of any sum which, by the terms of issue
of a Share, becomes payable at a fixed time, whether on account of the par value of the Share or by way of premium as if it had been payable by virtue of a call duly made and notified.
|
16.
|
TRANSMISSION OF SHARES
|
16.1
|
If a Member dies, the survivor or survivors (where he was a joint holder), or his legal personal representatives (where he was a
sole holder), shall be the only persons recognised by the Company as having any title to his Shares. The estate of a deceased Member is not thereby released from any liability in respect of any Share, for which he was a joint or sole
holder.
|
16.2
|
Any person becoming entitled to a Share in consequence of the death or bankruptcy or liquidation or dissolution of a Member (or
in any other way than by transfer) may, upon such evidence being produced as may be required by the Directors, elect, by a notice in writing sent by him to the Company, either to become the holder of such Share or to have some person
nominated by him registered as the holder of such Share. If he elects to have another person registered as the holder of such Share he shall sign an instrument of transfer of that Share to that person. The Directors shall, in either
case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the Share by the relevant Member before his death or bankruptcy or liquidation or dissolution, as the case may be.
|
16.3
|
A person becoming entitled to a Share by reason of the death or bankruptcy or liquidation or dissolution of a Member (or in any
other case than by transfer) shall be entitled to the same Dividends, other distributions and other advantages to which he would be entitled if he were the holder of such Share. However, he shall not, before becoming a Member in respect
of a Share, be entitled in respect of it to exercise any right conferred by membership in relation to general meetings of the Company and the Directors may at any time give notice requiring any such person to elect either to be
registered himself or to have some person nominated by him be registered as the holder of the Share (but the Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a
transfer of the Share by the relevant Member before his death or bankruptcy or liquidation or dissolution or any other case than by transfer, as the case may be). If the notice is not
|
17.
|
CLASS B ORDINARY SHARE CONVERSION
|
17.1
|
The rights attaching to the Class A Shares and Class B Shares shall rank pari passu in
all respects, and the Class A Shares and Class B Shares shall vote together as a single class on all matters (subject to the Variation of Rights of Shares Article and the Appointment and Removal of Directors Article hereof) with the
exception that the holder of a Class B Share shall have the Conversion Rights referred to in this Article.
|
17.2
|
Class B Shares shall automatically convert into Class A Shares on a one-for-one basis (the “Initial
Conversion Ratio”): (a) at any time and from time to time at the option of the holders thereof; and (b) automatically on the day of the closing of a Business Combination.
|
17.3
|
Notwithstanding the Initial Conversion Ratio, in the case that additional Class A Shares or any other Equity linked Securities,
are issued, or deemed issued, by the Company in excess of the amounts offered in the IPO and related to the closing of a Business Combination, all Class B Shares in issue shall automatically convert into Class A Shares at the time of
the consummation of a Business Combination at a ratio for which the Class B Shares shall convert into Class A Shares will be adjusted (unless the holders of a majority of the Class B Shares in issue agree to waive such anti-dilution
adjustment with respect to any such issuance or deemed issuance) so that the number of Class A Shares issuable upon conversion of all Class B Shares will equal, on an as-converted basis, in the aggregate, 20 per cent of the sum of all
Class A Shares and Class B Shares in issue upon completion of the IPO plus all Class A Shares and Equity linked Securities issued or deemed issued in connection with a Business Combination, excluding any Shares or Equity linked
Securities issued, or to be issued, to any seller in a Business Combination and any private placement warrants issued to the Sponsor or its Affiliates upon conversion of working capital loans made to the Company.
|
17.4
|
Notwithstanding anything to the contrary contained herein, the foregoing adjustment to the Initial Conversion Ratio may be
waived as to any particular issuance or deemed issuance of additional Class A Shares or Equity linked Securities by the written consent or agreement of holders of a majority of the Class B Shares then in issue consenting or agreeing
separately as a separate class in the manner provided in the Variation of Rights of Shares Article hereof.
|
17.5
|
The foregoing conversion ratio shall also be adjusted to account for any subdivision (by share split, subdivision, exchange,
capitalisation, rights issue, reclassification, recapitalisation or otherwise) or combination (by reverse share split, share consolidation, exchange, reclassification, recapitalisation or otherwise) or similar reclassification or
recapitalisation of the Class A Shares in issue into a greater or lesser number of shares occurring after the original filing of the Articles without a proportionate and corresponding subdivision, combination or similar reclassification
or recapitalisation of the Class B Shares in issue.
|
17.6
|
Each Class B Share shall convert into its pro rata number of Class A Shares pursuant to this Article. The pro rata share for
each holder of Class B Shares will be determined as follows: each Class B Share shall convert into such number of Class A Shares as is equal to the product of 1 multiplied by a fraction, the numerator of which shall be the total number
of Class A Shares into which all of the Class B Shares in issue shall be converted pursuant to this Article and the denominator of which shall be the total number of Class B Shares in issue at the time of conversion.
|
17.7
|
References in this Article to “converted”, “conversion”
or “exchange” shall mean the compulsory redemption without notice of Class B Shares of any Member and, on behalf of such Members, automatic application of such redemption proceeds in paying for
such new Class A Shares into which the Class B Shares have been converted or exchanged at a price per Class B Share necessary to give effect to a conversion or exchange calculated on the basis that the Class A Shares to be issued as
part of the conversion or exchange will be issued at par. The Class A Shares to be issued on an exchange or conversion shall be registered in the name of such Member or in such name as the Member may direct.
|
17.8
|
Notwithstanding anything to the contrary in this Article, in no event may any Class B Share convert into Class A Shares at a
ratio that is less than one-for-one.
|
18.
|
AMENDMENTS OF MEMORANDUM AND ARTICLES OF ASSOCIATION AND ALTERATION OF CAPITAL
|
18.1
|
The Company may by Ordinary Resolution:
|
(a)
|
increase its share capital by such sum as the Ordinary Resolution shall prescribe and with such rights, priorities and
privileges annexed thereto, as the Company in general meeting may determine;
|
(b)
|
consolidate and divide all or any of its share capital into Shares of larger amount than its existing Shares;
|
(c)
|
convert all or any of its paid-up Shares into stock, and reconvert that stock into paid-up Shares of any denomination;
|
(d)
|
by subdivision of its existing Shares or any of them divide the whole or any part of its share capital into Shares of smaller
amount than is fixed by the Memorandum or into Shares without par value; and
|
(e)
|
cancel any Shares that at the date of the passing of the Ordinary Resolution have not been taken or agreed to be taken by any
person and diminish the amount of its share capital by the amount of the Shares so cancelled.
|
18.2
|
All new Shares created in accordance with the provisions of the preceding Article shall be subject to the same provisions of the
Articles with reference to the payment of calls, liens, transfer, transmission, forfeiture and otherwise as the Shares in the original share capital.
|
18.3
|
Subject to the provisions of the Statute and the provisions of the Articles as regards the matters to be dealt with by Ordinary
Resolution, the Company may by Special Resolution:
|
(a)
|
change its name;
|
(b)
|
alter or add to the Articles;
|
(c)
|
alter or add to the Memorandum with respect to any objects, powers or other matters specified therein; and
|
(d)
|
reduce its share capital or any capital redemption reserve fund.
|
19.
|
OFFICES AND PLACES OF BUSINESS
|
20.
|
GENERAL MEETINGS
|
20.1
|
All general meetings other than annual general meetings shall be called extraordinary general meetings.
|
20.2
|
The Company may, but shall not (unless required by the Statute) be obliged to, in each year hold a general meeting as its annual
general meeting, and shall specify the meeting as such in the notices calling it. Any annual general meeting shall be held at such time and place as the Directors shall appoint. At these meetings the report of the Directors (if any)
shall be presented.
|
20.3
|
The Directors, the chief executive officer or the chairman of the board of Directors may call general meetings, and, for the
avoidance of doubt, Members shall not have the ability to call general meetings.
|
20.4
|
Members seeking to bring business before the annual general meeting or to nominate candidates for appointment as Directors at
the annual general meeting must deliver notice to the principal executive offices of the Company not less than 120 calendar days before the date of the Company’s proxy statement released to Members in connection with the previous year’s
annual general meeting or, if the
|
21.
|
NOTICE OF GENERAL MEETINGS
|
21.1
|
At least five clear days’ notice shall be given of any general meeting. Every notice shall specify the place, the day and the
hour of the meeting and the general nature of the business to be conducted at the general meeting and shall be given in the manner hereinafter mentioned or in such other manner if any as may be prescribed by the Company, provided that a
general meeting of the Company shall, whether or not the notice specified in this Article has been given and whether or not the provisions of the Articles regarding general meetings have been complied with, be deemed to have been duly
convened if it is so agreed:
|
(a)
|
in the case of an annual general meeting, by all of the Members entitled to attend and vote thereat; and
|
(b)
|
in the case of an extraordinary general meeting, by a majority in number of the Members having a right to attend and vote at the
meeting, together holding not less than ninety-five per cent in par value of the Shares giving that right.
|
21.2
|
The accidental omission to give notice of a general meeting to, or the non receipt of notice of a general meeting by, any person
entitled to receive such notice shall not invalidate the proceedings of that general meeting.
|
22.
|
PROCEEDINGS AT GENERAL MEETINGS
|
22.1
|
No business shall be transacted at any general meeting unless a quorum is present. The holders of a majority of the Shares being
individuals present in person or by proxy or if a corporation or other non-natural person by its duly authorised representative or proxy shall be a quorum.
|
22.2
|
A person may participate at a general meeting by conference telephone or other communications equipment by means of which all
the persons participating in the meeting can communicate with each other. Participation by a person in a general meeting in this manner is treated as presence in person at that meeting.
|
22.3
|
A resolution (including a Special Resolution) in writing (in one or more counterparts) signed by or on behalf of all of the
Members for the time being entitled to receive notice of and to attend and vote at general meetings (or, being corporations or other non-natural persons, signed by their duly authorised representatives) shall be as valid and effective
as if the resolution had been passed at a general meeting of the Company duly convened and held.
|
22.4
|
If a quorum is not present within half an hour from the time appointed for the meeting to commence, the meeting shall stand
adjourned to the same day in the next week at the same time and/or place or to such other day, time and/or place as the Directors may determine, and if at the adjourned meeting a quorum is not present within half an hour from the time
appointed for the meeting to commence, the Members present shall be a quorum.
|
22.5
|
The Directors may, at any time prior to the time appointed for the meeting to commence, appoint any person to act as chairman of
a general meeting of the Company or, if the Directors do not make any such appointment, the chairman, if any, of the board of Directors shall preside as chairman at such general meeting. If there is no such chairman, or if he shall not
be present within fifteen minutes after the time appointed for the meeting to commence, or is unwilling to act, the Directors present shall elect one of their number to be chairman of the meeting.
|
22.6
|
If no Director is willing to act as chairman or if no Director is present within fifteen minutes after the time appointed for
the meeting to commence, the Members present shall choose one of their number to be chairman of the meeting.
|
22.7
|
The chairman may, with the consent of a meeting at which a quorum is present (and shall if so directed
|
22.8
|
When a general meeting is adjourned for thirty days or more, notice of the adjourned meeting shall be given as in the case of an
original meeting. Otherwise it shall not be necessary to give any such notice of an adjourned meeting.
|
22.9
|
If, prior to a Business Combination, a notice is issued in respect of a general meeting and the Directors, in their absolute
discretion, consider that it is impractical or undesirable for any reason to hold that general meeting at the place, the day and the hour specified in the notice calling such general meeting, the Directors may postpone the general
meeting to another place, day and/or hour provided that notice of the place, the day and the hour of the rearranged general meeting is promptly given to all Members. No business shall be transacted at any postponed meeting other than
the business specified in the notice of the original meeting.
|
22.10
|
When a general meeting is postponed for thirty days or more, notice of the postponed meeting shall be given as in the case of an
original meeting. Otherwise it shall not be necessary to give any such notice of a postponed meeting. All proxy forms submitted for the original general meeting shall remain valid for the postponed meeting. The Directors may postpone a
general meeting which has already been postponed.
|
22.11
|
A resolution put to the vote of the meeting shall be decided on a poll.
|
22.12
|
A poll shall be taken as the chairman directs, and the result of the poll shall be deemed to be the resolution of the general
meeting at which the poll was demanded.
|
22.13
|
A poll demanded on the election of a chairman or on a question of adjournment shall be taken forthwith. A poll demanded on any
other question shall be taken at such date, time and place as the chairman of the general meeting directs, and any business other than that upon which a poll has been demanded or is contingent thereon may proceed pending the taking of
the poll.
|
22.14
|
In the case of an equality of votes the chairman shall be entitled to a second or casting vote.
|
23.
|
VOTES OF MEMBERS
|
23.1
|
Subject to any rights or restrictions attached to any Shares, every Member present in any such manner shall have one vote for
every Share of which he is the holder.
|
23.2
|
In the case of joint holders the vote of the senior holder who tenders a vote, whether in person or by proxy (or, in the case of
a corporation or other non-natural person, by its duly authorised representative or proxy), shall be accepted to the exclusion of the votes of the other joint holders, and seniority shall be determined by the order in which the names of
the holders stand in the Register of Members.
|
23.3
|
A Member of unsound mind, or in respect of whom an order has been made by any court, having jurisdiction in lunacy, may vote by
his committee, receiver, curator bonis, or other person on such Member’s behalf appointed by that court, and any such committee, receiver, curator bonis or other person may vote by proxy.
|
23.4
|
No person shall be entitled to vote at any general meeting unless he is registered as a Member on the record date for such
meeting nor unless all calls or other monies then payable by him in respect of Shares have been paid.
|
23.5
|
No objection shall be raised as to the qualification of any voter except at the general meeting or adjourned general meeting at
which the vote objected to is given or tendered and every vote not disallowed at the meeting shall be valid. Any objection made in due time in accordance with this Article shall be referred to the chairman whose decision shall be final
and conclusive.
|
23.6
|
Votes may be cast either personally or by proxy (or in the case of a corporation or other non-natural person by its duly
authorised representative or proxy). A Member may appoint more than one proxy or the same proxy under one or more instruments to attend and vote at a meeting. Where a Member appoints more than one proxy the instrument of proxy shall
specify the number of Shares in respect of which each proxy is entitled to exercise the related votes.
|
23.7
|
A Member holding more than one Share need not cast the votes in respect of his Shares in the same way on any resolution and
therefore may vote a Share or some or all such Shares either for or against a resolution and/or abstain from voting a Share or some or all of the Shares and, subject to the terms of the instrument appointing him, a proxy appointed under
one or more instruments may vote a Share or some or all of the Shares in respect of which he is appointed either for or against a resolution and/or abstain from voting a Share or some or all of the Shares in respect of which he is
appointed.
|
24.
|
PROXIES
|
24.1
|
The instrument appointing a proxy shall be in writing and shall be executed under the hand of the appointor or of his attorney
duly authorised in writing, or, if the appointor is a corporation or other non natural person, under the hand of its duly authorised representative. A proxy need not be a Member.
|
24.2
|
The Directors may, in the notice convening any meeting or adjourned meeting, or in an instrument of proxy sent out by the
Company, specify the manner by which the instrument appointing a proxy shall be deposited and the place and the time (being not later than the time appointed for the commencement of the meeting or adjourned meeting to which the proxy
relates) at which the instrument appointing a proxy shall be deposited. In the absence of any such direction from the Directors in the notice convening any meeting or adjourned meeting or in an instrument of proxy sent out by the
Company, the instrument appointing a proxy shall be deposited physically at the Registered Office not less than 48 hours before the time appointed for the meeting or adjourned meeting to commence at which the person named in the
instrument proposes to vote.
|
24.3
|
The chairman may in any event at his discretion declare that an instrument of proxy shall be deemed to have been duly deposited.
An instrument of proxy that is not deposited in the manner permitted, or which has not been declared to have been duly deposited by the chairman, shall be invalid.
|
24.4
|
The instrument appointing a proxy may be in any usual or common form (or such other form as the Directors may approve) and may
be expressed to be for a particular meeting or any adjournment thereof or generally until revoked. An instrument appointing a proxy shall be deemed to include the power to demand or join or concur in demanding a poll.
|
24.5
|
Votes given in accordance with the terms of an instrument of proxy shall be valid notwithstanding the previous death or insanity
of the principal or revocation of the proxy or of the authority under which the proxy was executed, or the transfer of the Share in respect of which the proxy is given unless notice in writing of such death, insanity, revocation or
transfer was received by the Company at the Registered Office before the commencement of the general meeting, or adjourned meeting at which it is sought to use the proxy.
|
25.
|
CORPORATE MEMBERS
|
25.1
|
Any corporation or other non-natural person which is a Member may in accordance with its constitutional documents, or in the
absence of such provision by resolution of its directors or other governing body, authorise such person as it thinks fit to act as its representative at any meeting of the Company or of any class of Members, and the person so authorised
shall be entitled to exercise the same powers on behalf of the corporation which he represents as the corporation could exercise if it were an individual Member.
|
25.2
|
If a Clearing House (or its nominee(s)), being a corporation, is a Member, it may authorise such persons as it sees fit to act
as its representative at any meeting of the Company or at any meeting of any class of Members provided that the authorisation shall specify the number and class of Shares in respect of which each such representative is so authorised.
Each person so authorised under the provisions of this Article shall be deemed to have been duly authorised without further evidence of the facts and be entitled to exercise the same rights and powers on behalf of the Clearing House (or
its nominee(s)) as if such person was the registered holder of such Shares held by the Clearing House (or its nominee(s)).
|
26.
|
SHARES THAT MAY NOT BE VOTED
|
27.
|
DIRECTORS
|
27.1
|
There shall be a board of Directors consisting of not less than one person provided however that the Company may by Ordinary
Resolution increase or reduce the limits in the number of Directors.
|
27.2
|
The Directors shall be divided into three classes: Class I, Class II and Class III. The number of Directors in each class shall
be as nearly equal as possible. Upon the adoption of the Articles, the existing Directors shall by resolution classify themselves as Class I, Class II or Class III Directors. The Class I Directors shall stand elected for a term expiring
at the Company’s first annual general meeting, the Class II Directors shall stand elected for a term expiring at the Company’s second annual general meeting and the Class III Directors shall stand elected for a term expiring at the
Company’s third annual general meeting. Commencing at the Company’s first annual general meeting, and at each annual general meeting thereafter, Directors elected to succeed those Directors whose terms expire shall be elected for a term
of office to expire at the third succeeding annual general meeting after their election. Except as the Statute or other Applicable Law may otherwise require, in the interim between annual general meetings or extraordinary general
meetings called for the election of Directors and/or the removal of one or more Directors and the filling of any vacancy in that connection, additional Directors and any vacancies in the board of Directors, including unfilled vacancies
resulting from the removal of Directors for cause, may be filled by the vote of a majority of the remaining Directors then in office, although less than a quorum (as defined in the Articles), or by the sole remaining Director. All
Directors shall hold office until the expiration of their respective terms of office and until their successors shall have been elected and qualified. A Director elected to fill a vacancy resulting from the death, resignation or removal
of a Director shall serve for the remainder of the full term of the Director whose death, resignation or removal shall have created such vacancy and until his successor shall have been elected and qualified.
|
28.
|
POWERS OF DIRECTORS
|
28.1
|
Subject to the provisions of the Statute, the Memorandum and the Articles and to any directions given by Special Resolution, the
business of the Company shall be managed by the Directors who may exercise all the powers of the Company. No alteration of the Memorandum or Articles and no such direction shall invalidate any prior act of the Directors which would have
been valid if that alteration had not been made or that direction had not been given. A duly convened meeting of Directors at which a quorum is present may exercise all powers exercisable by the Directors.
|
28.2
|
All cheques, promissory notes, drafts, bills of exchange and other negotiable or transferable instruments and all receipts for
monies paid to the Company shall be signed, drawn, accepted, endorsed or otherwise executed as the case may be in such manner as the Directors shall determine by resolution.
|
28.3
|
The Directors on behalf of the Company may pay a gratuity or pension or allowance on retirement to any Director who has held any
other salaried office or place of profit with the Company or to his widow or dependants and may make contributions to any fund and pay premiums for the purchase or provision of any such gratuity, pension or allowance.
|
28.4
|
The Directors may exercise all the powers of the Company to borrow money and to mortgage or charge its undertaking, property and
assets (present and future) and uncalled capital or any part thereof and to issue debentures, debenture stock, mortgages, bonds and other such securities whether outright or as security for any debt, liability or obligation of the
Company or of any third party.
|
29.
|
APPOINTMENT AND REMOVAL OF DIRECTORS
|
29.1
|
Prior to the closing of a Business Combination, the Company may by Ordinary Resolution of the holders of the Class B Shares
appoint any person to be a Director or may by Ordinary Resolution of
|
29.2
|
The Directors may appoint any person to be a Director, either to fill a vacancy or as an additional Director provided that the
appointment does not cause the number of Directors to exceed any number fixed by or in accordance with the Articles as the maximum number of Directors.
|
29.3
|
After the closing of a Business Combination, the Company may by Ordinary Resolution appoint any person to be a Director or may
by Ordinary Resolution remove any Director.
|
30.
|
VACATION OF OFFICE OF DIRECTOR
|
(a)
|
the Director gives notice in writing to the Company that he resigns the office of Director; or
|
(b)
|
the Director absents himself (for the avoidance of doubt, without being represented by proxy) from three consecutive meetings of
the board of Directors without special leave of absence from the Directors, and the Directors pass a resolution that he has by reason of such absence vacated office; or
|
(c)
|
the Director dies, becomes bankrupt or makes any arrangement or composition with his creditors generally; or
|
(d)
|
the Director is found to be or becomes of unsound mind; or
|
(e)
|
all of the other Directors (being not less than two in number) determine that he should be removed as a Director, either by a
resolution passed by all of the other Directors at a meeting of the Directors duly convened and held in accordance with the Articles or by a resolution in writing signed by all of the other Directors.
|
31.
|
PROCEEDINGS OF DIRECTORS
|
31.1
|
The quorum for the transaction of the business of the Directors may be fixed by the Directors, and unless so fixed shall be a
majority of the Directors then in office.
|
31.2
|
Subject to the provisions of the Articles, the Directors may regulate their proceedings as they think fit. Questions arising at
any meeting shall be decided by a majority of votes. In the case of an equality of votes, the chairman shall have a second or casting vote.
|
31.3
|
A person may participate in a meeting of the Directors or any committee of Directors by conference telephone or other
communications equipment by means of which all the persons participating in the meeting can communicate with each other at the same time. Participation by a person in a meeting in this manner is treated as presence in person at that
meeting. Unless otherwise determined by the Directors, the meeting shall be deemed to be held at the place where the chairman is located at the start of the meeting.
|
31.4
|
A resolution in writing (in one or more counterparts) signed by all the Directors or all the members of a committee of the
Directors or, in the case of a resolution in writing relating to the removal of any Director or the vacation of office by any Director, all of the Directors other than the Director who is the subject of such resolution shall be as valid
and effectual as if it had been passed at a meeting of the Directors, or committee of Directors as the case may be, duly convened and held.
|
31.5
|
A Director may, or other Officer on the direction of a Director shall, call a meeting of the Directors by at least two days’
notice in writing to every Director which notice shall set forth the general nature of the business to be considered unless notice is waived by all the Directors either at, before or after the meeting is held. To any such notice of a
meeting of the Directors all the provisions of the Articles relating to the giving of notices by the Company to the Members shall apply mutatis mutandis.
|
31.6
|
The continuing Directors (or a sole continuing Director, as the case may be) may act notwithstanding any vacancy in their body,
but if and so long as their number is reduced below the number fixed by or pursuant to the Articles as the necessary quorum of Directors the continuing Directors or Director may
|
31.7
|
The Directors may elect a chairman of their board and determine the period for which he is to hold office; but if no such
chairman is elected, or if at any meeting the chairman is not present within five minutes after the time appointed for the meeting to commence, the Directors present may choose one of their number to be chairman of the meeting.
|
31.8
|
All acts done by any meeting of the Directors or of a committee of the Directors shall, notwithstanding that it is afterwards
discovered that there was some defect in the appointment of any Director, and/or that they or any of them were disqualified, and/or had vacated their office and/or were not entitled to vote, be as valid as if every such person had been
duly appointed and/or not disqualified to be a Director and/or had not vacated their office and/or had been entitled to vote, as the case may be.
|
31.9
|
A Director may be represented at any meetings of the board of Directors by a proxy appointed in writing by him. The proxy shall
count towards the quorum and the vote of the proxy shall for all purposes be deemed to be that of the appointing Director.
|
32.
|
PRESUMPTION OF ASSENT
|
33.
|
DIRECTORS’ INTERESTS
|
33.1
|
A Director may hold any other office or place of profit under the Company (other than the office of Auditor) in conjunction with
his office of Director for such period and on such terms as to remuneration and otherwise as the Directors may determine.
|
33.2
|
A Director may act by himself or by, through or on behalf of his firm in a professional capacity for the Company and he or his
firm shall be entitled to remuneration for professional services as if he were not a Director.
|
33.3
|
A Director may be or become a director or other officer of or otherwise interested in any company promoted by the Company or in
which the Company may be interested as a shareholder, a contracting party or otherwise, and no such Director shall be accountable to the Company for any remuneration or other benefits received by him as a director or officer of, or from
his interest in, such other company.
|
33.4
|
No person shall be disqualified from the office of Director or prevented by such office from contracting with the Company,
either as vendor, purchaser or otherwise, nor shall any such contract or any contract or transaction entered into by or on behalf of the Company in which any Director shall be in any way interested be or be liable to be avoided, nor
shall any Director so contracting or being so interested be liable to account to the Company for any profit realised by or arising in connection with any such contract or transaction by reason of such Director holding office or of the
fiduciary relationship thereby established. A Director shall be at liberty to vote in respect of any contract or transaction in which he is interested provided that the nature of the interest of any Director in any such contract or
transaction shall be disclosed by him at or prior to its consideration and any vote thereon.
|
33.5
|
A general notice that a Director is a shareholder, director, officer or employee of any specified firm or company and is to be
regarded as interested in any transaction with such firm or company shall be sufficient disclosure for the purposes of voting on a resolution in respect of a contract or transaction in which he has an interest, and after such general
notice it shall not be necessary to give special notice relating to any particular transaction.
|
34.
|
MINUTES
|
35.
|
DELEGATION OF DIRECTORS’ POWERS
|
35.1
|
The Directors may delegate any of their powers, authorities and discretions, including the power to sub-delegate, to any
committee consisting of one or more Directors (including, without limitation, the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee). Any such delegation may be made subject to any
conditions the Directors may impose and either collaterally with or to the exclusion of their own powers and any such delegation may be revoked or altered by the Directors. Subject to any such conditions, the proceedings of a committee
of Directors shall be governed by the Articles regulating the proceedings of Directors, so far as they are capable of applying.
|
35.2
|
The Directors may establish any committees, local boards or agencies or appoint any person to be a manager or agent for managing
the affairs of the Company and may appoint any person to be a member of such committees, local boards or agencies. Any such appointment may be made subject to any conditions the Directors may impose, and either collaterally with or to
the exclusion of their own powers and any such appointment may be revoked or altered by the Directors. Subject to any such conditions, the proceedings of any such committee, local board or agency shall be governed by the Articles
regulating the proceedings of Directors, so far as they are capable of applying.
|
35.3
|
The Directors may adopt formal written charters for committees and, if so adopted, shall review and assess the adequacy of such
formal written charters on an annual basis. Each of these committees shall be empowered to do all things necessary to exercise the rights of such committee set forth in the Articles and shall have such powers as the Directors may
delegate pursuant to the Articles and as required by the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law.
Each of the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee, if established, shall consist of such number of Directors as the Directors shall from time to time determine (or such minimum
number as may be required from time to time by the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law). For so
long as any class of Shares is listed on the Designated Stock Exchange, the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee shall be made up of such number of Independent Directors as is
required from time to time by the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law.
|
35.4
|
The Directors may by power of attorney or otherwise appoint any person to be the agent of the Company on such conditions as the
Directors may determine, provided that the delegation is not to the exclusion of their own powers and may be revoked by the Directors at any time.
|
35.5
|
The Directors may by power of attorney or otherwise appoint any company, firm, person or body of persons, whether nominated
directly or indirectly by the Directors, to be the attorney or authorised signatory of the Company for such purpose and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Directors under
the Articles) and for such period and subject to such conditions as they may think fit, and any such powers of attorney or other appointment may contain such provisions for the protection and convenience of persons dealing with any such
attorneys or authorised signatories as the Directors may think fit and may also authorise any such attorney or authorised signatory to delegate all or any of the powers, authorities and discretions vested in him.
|
35.6
|
The Directors may appoint such Officers as they consider necessary on such terms, at such remuneration and to perform such
duties, and subject to such provisions as to disqualification and removal as the Directors may think fit. Unless otherwise specified in the terms of his appointment an
|
36.
|
NO MINIMUM SHAREHOLDING
|
37.
|
REMUNERATION OF DIRECTORS
|
37.1
|
The remuneration to be paid to the Directors, if any, shall be such remuneration as the Directors shall determine, provided that
no cash remuneration shall be paid to any Director by the Company prior to the consummation of a Business Combination. The Directors shall also, whether prior to or after the consummation of a Business Combination, be entitled to be
paid all travelling, hotel and other expenses properly incurred by them in connection with their attendance at meetings of Directors or committees of Directors, or general meetings of the Company, or separate meetings of the holders of
any class of Shares or debentures of the Company, or otherwise in connection with the business of the Company or the discharge of their duties as a Director, or to receive a fixed allowance in respect thereof as may be determined by the
Directors, or a combination partly of one such method and partly the other.
|
37.2
|
The Directors may by resolution approve additional remuneration to any Director for any services which in the opinion of the
Directors go beyond his ordinary routine work as a Director. Any fees paid to a Director who is also counsel, attorney or solicitor to the Company, or otherwise serves it in a professional capacity shall be in addition to his
remuneration as a Director.
|
38.
|
SEAL
|
38.1
|
The Company may, if the Directors so determine, have a Seal. The Seal shall only be used by the authority of the Directors or of
a committee of the Directors authorised by the Directors. Every instrument to which the Seal has been affixed shall be signed by at least one person who shall be either a Director or some Officer or other person appointed by the
Directors for the purpose.
|
38.2
|
The Company may have for use in any place or places outside the Cayman Islands a duplicate Seal or Seals each of which shall be
a facsimile of the common Seal of the Company and, if the Directors so determine, with the addition on its face of the name of every place where it is to be used.
|
38.3
|
A Director or Officer, representative or attorney of the Company may without further authority of the Directors affix the Seal
over his signature alone to any document of the Company required to be authenticated by him under seal or to be filed with the Registrar of Companies in the Cayman Islands or elsewhere wheresoever.
|
39.
|
DIVIDENDS, DISTRIBUTIONS AND RESERVE
|
39.1
|
Subject to the Statute and this Article and except as otherwise provided by the rights attached to any Shares, the Directors may
resolve to pay Dividends and other distributions on Shares in issue and authorise payment of the Dividends or other distributions out of the funds of the Company lawfully available therefor. A Dividend shall be deemed to be an interim
Dividend unless the terms of the resolution pursuant to which the Directors resolve to pay such Dividend specifically state that such Dividend shall be a final Dividend. No Dividend or other distribution shall be paid except out of the
realised or unrealised profits of the Company, out of the share premium account or as otherwise permitted by law.
|
39.2
|
Except as otherwise provided by the rights attached to any Shares, all Dividends and other distributions shall be paid according
to the par value of the Shares that a Member holds. If any Share is issued on terms providing that it shall rank for Dividend as from a particular date, that Share shall rank for Dividend accordingly.
|
39.3
|
The Directors may deduct from any Dividend or other distribution payable to any Member all sums of money (if any) then payable
by him to the Company on account of calls or otherwise.
|
39.4
|
The Directors may resolve that any Dividend or other distribution be paid wholly or partly by the
|
39.5
|
Except as otherwise provided by the rights attached to any Shares, Dividends and other distributions may be paid in any
currency. The Directors may determine the basis of conversion for any currency conversions that may be required and how any costs involved are to be met.
|
39.6
|
The Directors may, before resolving to pay any Dividend or other distribution, set aside such sums as they think proper as a
reserve or reserves which shall, at the discretion of the Directors, be applicable for any purpose of the Company and pending such application may, at the discretion of the Directors, be employed in the business of the Company.
|
39.7
|
Any Dividend, other distribution, interest or other monies payable in cash in respect of Shares may be paid by wire transfer to
the holder or by cheque or warrant sent through the post directed to the registered address of the holder or, in the case of joint holders, to the registered address of the holder who is first named on the Register of Members or to such
person and to such address as such holder or joint holders may in writing direct. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent. Any one of two or more joint holders may give effectual
receipts for any Dividends, other distributions, bonuses, or other monies payable in respect of the Share held by them as joint holders.
|
39.8
|
No Dividend or other distribution shall bear interest against the Company.
|
39.9
|
Any Dividend or other distribution which cannot be paid to a Member and/or which remains unclaimed after six months from the
date on which such Dividend or other distribution becomes payable may, in the discretion of the Directors, be paid into a separate account in the Company’s name, provided that the Company shall not be constituted as a trustee in respect
of that account and the Dividend or other distribution shall remain as a debt due to the Member. Any Dividend or other distribution which remains unclaimed after a period of six years from the date on which such Dividend or other
distribution becomes payable shall be forfeited and shall revert to the Company.
|
40.
|
CAPITALISATION
|
41.
|
BOOKS OF ACCOUNT
|
41.1
|
The Directors shall cause proper books of account (including, where applicable, material underlying documentation including
contracts and invoices) to be kept with respect to all sums of money received and expended by the Company and the matters in respect of which the receipt or expenditure takes place, all sales and purchases of goods by the Company and
the assets and liabilities of the Company.
|
41.2
|
The Directors shall determine whether and to what extent and at what times and places and under what conditions or regulations
the accounts and books of the Company or any of them shall be open to the inspection of Members not being Directors and no Member (not being a Director) shall have any right of inspecting any account or book or document of the Company
except as conferred by Statute or authorised by the Directors or by the Company in general meeting.
|
41.3
|
The Directors may cause to be prepared and to be laid before the Company in general meeting profit and loss accounts, balance
sheets, group accounts (if any) and such other reports and accounts as may be required by law.
|
42.
|
AUDIT
|
42.1
|
The Directors may appoint an Auditor of the Company who shall hold office on such terms as the Directors determine.
|
42.2
|
Without prejudice to the freedom of the Directors to establish any other committee, if the Shares (or depositary receipts
therefor) are listed or quoted on the Designated Stock Exchange, and if required by the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or
otherwise under Applicable Law, the Directors shall establish and maintain an Audit Committee as a committee of the Directors and shall adopt a formal written Audit Committee charter and review and assess the adequacy of the formal
written charter on an annual basis. The composition and responsibilities of the Audit Committee shall comply with the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other
competent regulatory authority or otherwise under Applicable Law.
|
42.3
|
If the Shares (or depositary receipts therefor) are listed or quoted on the Designated Stock Exchange, the Company shall conduct
an appropriate review of all related party transactions on an ongoing basis and shall utilise the Audit Committee for the review and approval of potential conflicts of interest.
|
42.4
|
The remuneration of the Auditor shall be fixed by the Audit Committee (if one exists).
|
42.5
|
If the office of Auditor becomes vacant by resignation or death of the Auditor, or by his becoming incapable of acting by reason
of illness or other disability at a time when his services are required, the Directors shall fill the vacancy and determine the remuneration of such Auditor.
|
42.6
|
Every Auditor of the Company shall have a right of access at all times to the books and accounts and vouchers of the Company and
shall be entitled to require from the Directors and Officers such information and explanation as may be necessary for the performance of the duties of the Auditor.
|
42.7
|
Auditors shall, if so required by the Directors, make a report on the accounts of the Company during their tenure of office at
the next annual general meeting following their appointment in the case of a company which is registered with the Registrar of Companies as an ordinary company, and at the next extraordinary general meeting following their appointment
in the case of a company which is registered with the Registrar of Companies as an exempted company, and at any other time during their term of office, upon request of the Directors or any general meeting of the Members.
|
43.
|
NOTICES
|
43.1
|
Notices shall be in writing and may be given by the Company to any Member either personally or by sending it by courier, post,
cable, telex, fax or e-mail to him or to his address as shown in the Register of Members (or where the notice is given by e-mail by sending it to the e-mail address provided by such Member). Notice may also be served by Electronic
Communication in accordance with the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or by placing it on the Company’s Website.
|
43.2
|
Where a notice is sent by:
|
(a)
|
courier; service of the notice shall be deemed to be effected by delivery of the notice to a courier company, and shall be
deemed to have been received on the third day (not including Saturdays or Sundays or public holidays) following the day on which the notice was delivered to the courier;
|
(b)
|
post; service of the notice shall be deemed to be effected by properly addressing, pre paying and posting a letter containing
the notice, and shall be deemed to have been received on the fifth day (not including Saturdays or Sundays or public holidays in the Cayman Islands) following the day on which the notice was posted;
|
(c)
|
cable, telex or fax; service of the notice shall be deemed to be effected by properly addressing and sending such notice and
shall be deemed to have been received on the same day that it was transmitted;
|
(d)
|
e-mail or other Electronic Communication; service of the notice shall be deemed to be effected by transmitting the e-mail to the
e-mail address provided by the intended recipient and shall be deemed to have been received on the same day that it was sent, and it shall not be necessary for the receipt of the e-mail to be acknowledged by the recipient; and
|
(e)
|
placing it on the Company’s Website; service of the notice shall be deemed to have been effected one hour after the notice or
document was placed on the Company’s Website.
|
43.3
|
A notice may be given by the Company to the person or persons which the Company has been advised are entitled to a Share or
Shares in consequence of the death or bankruptcy of a Member in the same manner as other notices which are required to be given under the Articles and shall be addressed to them by name, or by the title of representatives of the
deceased, or trustee of the bankrupt, or by any like description at the address supplied for that purpose by the persons claiming to be so entitled, or at the option of the Company by giving the notice in any manner in which the same
might have been given if the death or bankruptcy had not occurred.
|
43.4
|
Notice of every general meeting shall be given in any manner authorised by the Articles to every holder of Shares carrying an
entitlement to receive such notice on the record date for such meeting except that in the case of joint holders the notice shall be sufficient if given to the joint holder first named in the Register of Members and every person upon
whom the ownership of a Share devolves by reason of his being a legal personal representative or a trustee in bankruptcy of a Member where the Member but for his death or bankruptcy would be entitled to receive notice of the meeting,
and no other person shall be entitled to receive notices of general meetings.
|
44.
|
WINDING UP
|
44.1
|
If the Company shall be wound up, the liquidator shall apply the assets of the Company in satisfaction of creditors’ claims in
such manner and order as such liquidator thinks fit. Subject to the rights attaching to any Shares, in a winding up:
|
(a)
|
if the assets available for distribution amongst the Members shall be insufficient to repay the whole of the Company’s issued
share capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the Members in proportion to the par value of the Shares held by them; or
|
(b)
|
if the assets available for distribution amongst the Members shall be more than sufficient to repay the whole of the Company’s
issued share capital at the commencement of the winding up, the surplus shall be distributed amongst the Members in proportion to the par value of the Shares held by them at the commencement of the winding up subject to a deduction from
those Shares in respect of which there are monies due, of all monies payable to the Company for unpaid calls or otherwise.
|
44.2
|
If the Company shall be wound up the liquidator may, subject to the rights attaching to any Shares and with the approval of a
Special Resolution of the Company and any other approval required by the Statute, divide amongst the Members in kind the whole or any part of the assets of the Company (whether such assets shall consist of property of the same kind or
not) and may for that purpose value
|
45.
|
INDEMNITY AND INSURANCE
|
45.1
|
Every Director and Officer (which for the avoidance of doubt, shall not include auditors of the Company), together with every
former Director and former Officer (each an “Indemnified Person”) shall be indemnified out of the assets of the Company against any liability, action, proceeding, claim, demand, costs, damages or
expenses, including legal expenses, whatsoever which they or any of them may incur as a result of any act or failure to act in carrying out their functions other than such liability (if any) that they may incur by reason of their own
actual fraud, wilful neglect or wilful default. No Indemnified Person shall be liable to the Company for any loss or damage incurred by the Company as a result (whether direct or indirect) of the carrying out of their functions unless
that liability arises through the actual fraud, wilful neglect or wilful default of such Indemnified Person. No person shall be found to have committed actual fraud, wilful neglect or wilful default under this Article unless or until a
court of competent jurisdiction shall have made a finding to that effect.
|
45.2
|
The Company shall advance to each Indemnified Person reasonable attorneys’ fees and other costs and expenses incurred in
connection with the defence of any action, suit, proceeding or investigation involving such Indemnified Person for which indemnity will or could be sought. In connection with any advance of any expenses hereunder, the Indemnified Person
shall execute an undertaking to repay the advanced amount to the Company if it shall be determined by final judgment or other final adjudication that such Indemnified Person was not entitled to indemnification pursuant to this Article.
If it shall be determined by a final judgment or other final adjudication that such Indemnified Person was not entitled to indemnification with respect to such judgment, costs or expenses, then such party shall not be indemnified with
respect to such judgment, costs or expenses and any advancement shall be returned to the Company (without interest) by the Indemnified Person.
|
45.3
|
The Directors, on behalf of the Company, may purchase and maintain insurance for the benefit of any Director or Officer against
any liability which, by virtue of any rule of law, would otherwise attach to such person in respect of any negligence, default, breach of duty or breach of trust of which such person may be guilty in relation to the Company.
|
46.
|
FINANCIAL YEAR
|
47.
|
TRANSFER BY WAY OF CONTINUATION
|
48.
|
MERGERS AND CONSOLIDATIONS
|
49.
|
BUSINESS COMBINATION
|
49.1
|
Notwithstanding any other provision of the Articles, this Article shall apply during the period commencing upon the adoption of
the Articles and terminating upon the first to occur of the consummation of a Business Combination and the full distribution of the Trust Account pursuant to this Article. In the event of a conflict between this Article and any other
Articles, the provisions of this Article shall prevail.
|
49.2
|
Prior to the consummation of a Business Combination, the Company shall either:
|
(a)
|
submit such Business Combination to its Members for approval; or
|
(b)
|
provide Members with the opportunity to have their Shares repurchased by means of a tender offer for a per-Share repurchase
price payable in cash, equal to the aggregate amount then on deposit in the Trust Account, calculated as of two business days prior to the consummation of such Business Combination, including interest earned on the Trust Account (net of
taxes paid or payable and amounts withdrawn to fund the Company’s working capital requirements, if any), divided by the number of then issued Public Shares. Such obligation to repurchase Shares is subject to the completion of the
proposed Business Combination to which it relates.
|
49.3
|
If the Company initiates any tender offer in accordance with Rule 13e-4 and Regulation 14E of the Exchange Act in connection
with a proposed Business Combination, it shall file tender offer documents with the Securities and Exchange Commission prior to completing such Business Combination which contain substantially the same financial and other information
about such Business Combination and the redemption rights as is required under Regulation 14A of the Exchange Act. If, alternatively, the Company holds a general meeting to approve a proposed Business Combination, the Company will
conduct any redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, and not pursuant to the tender offer rules, and file proxy materials with the Securities and Exchange Commission.
|
49.4
|
At a general meeting called for the purposes of approving a Business Combination pursuant to this Article, in the event that
such Business Combination is approved by Ordinary Resolution, the Company shall be authorised to consummate such Business Combination.
|
49.5
|
Any Member holding Public Shares who is not the Sponsor, a Founder, Officer or Director may, at least two business days prior to
any vote on a Business Combination, elect to have their Public Shares redeemed for cash, in accordance with any applicable requirements provided for in the related proxy materials (the “IPO Redemption”),
provided that no such Member acting together with any Affiliate of his or any other person with whom he is acting in concert or as a partnership, limited partnership, syndicate, or other group for the purposes of acquiring, holding, or
disposing of Shares may exercise this redemption right with respect to more than 15 per cent of the Public Shares in the aggregate without the prior consent of the Company and provided further that any beneficial holder of Public Shares
on whose behalf a redemption right is being exercised must identify itself to the Company in connection with any redemption election in order to validly redeem such Public Shares. If so demanded, the Company shall pay any such redeeming
Member, regardless of whether he is voting for or against such proposed Business Combination, a per-Share redemption price payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated as of two business
days prior to the consummation of the Business Combination, including interest earned on the Trust Account (such interest shall be net of taxes payable and amounts withdrawn to fund the Company’s working capital requirements) and not
previously released to the Company to pay its taxes or fund the Company’s working capital requirements, divided by the number of then issued Public Shares (such redemption price being referred to herein as the “Redemption Price”), but only in the event that the applicable proposed Business Combination is approved and consummated.
|
49.6
|
A Member may not withdraw a Redemption Notice once submitted to the Company unless the Directors determine (in their sole
discretion) to permit the withdrawal of such redemption request (which they may do in whole or in part).
|
49.7
|
In the event that the Company does not consummate a Business Combination on or before February 9, 2024, or such later time as
the Members may approve in accordance with the Articles, the Company shall:
|
(a)
|
cease all operations except for the purpose of winding up;
|
(b)
|
as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-Share
price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to the Company (less taxes payable, expenses
relating to the administration of
|
(c)
|
as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining Members and the
Directors, liquidate and dissolve,
|
49.8
|
In the event that any amendment is made to this Article:
|
(a)
|
to modify the substance or timing of the Company’s obligation to allow redemption in connection with a Business Combination or
redeem 100 per cent of the Public Shares if the Company does not consummate a Business Combination on or before February 9, 2024; or
|
(b)
|
with respect to any other provision relating to Members’ rights or pre-Business Combination activity, the Company shall provide
the holders of Public Shares with the opportunity to redeem their Public Shares upon the approval or effectiveness of any such amendment at a per-Share price, payable in cash, equal to the aggregate amount then on deposit in the Trust
Account, including interest earned on the funds held in the Trust Account and not previously released to the Company to pay its taxes or fund the Company’s working capital requirements, divided by the number of then outstanding Public
Shares.
|
49.9
|
A holder of Public Shares shall be entitled to receive distributions from the Trust Account only in the event of an IPO
Redemption, a repurchase of Shares by means of a tender offer pursuant to this Article, or a distribution of the Trust Account pursuant to this Article. In no other circumstance shall a holder of Public Shares have any right or interest
of any kind in the Trust Account.
|
49.10
|
After the issue of Public Shares, and prior to the consummation of a Business Combination, the Company shall not issue
additional Shares or any other securities that would entitle the holders thereof to:
|
(a)
|
receive funds from the Trust Account; or
|
(b)
|
vote as a class with Public Shares on a Business Combination.
|
49.11
|
The uninterested Independent Directors shall approve any transaction or transactions between the Company and any of the
following parties:
|
(a)
|
any Member owning an interest in the voting power of the Company that gives such Member a significant influence over the
Company; and
|
(b)
|
any Director or Officer and any Affiliate of such Director or Officer.
|
49.12
|
A Director may vote in respect of a Business Combination in which such Director has a conflict of interest with respect to the
evaluation of such Business Combination. Such Director must disclose such interest or conflict to the other Directors.
|
49.13
|
As long as the securities of the Company are listed on the Nasdaq Capital Market, the Company must complete one or more Business
Combinations having an aggregate fair market value of at least 80 per cent of the assets held in the Trust Account (net of amounts previously disbursed to the Company’s management for taxes, amounts withdrawn to fund the Company’s
working capital requirements and excluding the amount of deferred underwriting discounts held in the Trust Account) at the time of the Company’s signing a definitive agreement in connection with a Business Combination. A Business
Combination must not be effectuated with another blank cheque company or a similar company with nominal operations.
|
49.14
|
The Company may enter into a Business Combination with a target business that is Affiliated with the Sponsor, a Founder, a
Director or an Officer. In the event the Company seeks to complete a Business Combination with a target that is Affiliated with the Sponsor, a Founder, a Director or an Officer, the
|
50.
|
BUSINESS OPPORTUNITIES
|
50.1
|
To the fullest extent permitted by Applicable Law, no individual serving as a Director or an Officer (“Management”) shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as the Company. To
the fullest extent permitted by Applicable Law, the Company renounces any interest or expectancy of the Company in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate
opportunity for Management, on the one hand, and the Company, on the other. Except to the extent expressly assumed by contract, to the fullest extent permitted by Applicable Law, Management shall have no duty to communicate or offer any
such corporate opportunity to the Company and shall not be liable to the Company or its Members for breach of any fiduciary duty as a Member, Director and/or Officer solely by reason of the fact that such party pursues or acquires such
corporate opportunity for itself, himself or herself, directs such corporate opportunity to another person, or does not communicate information regarding such corporate opportunity to the Company.
|
50.2
|
Except as provided elsewhere in this Article, the Company hereby renounces any interest or expectancy of the Company in, or in
being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for both the Company and Management, about which a Director and/or Officer who is also a member of Management
acquires knowledge.
|
50.3
|
To the extent a court might hold that the conduct of any activity related to a corporate opportunity that is renounced in this
Article to be a breach of duty to the Company or its Members, the Company hereby waives, to the fullest extent permitted by Applicable Law, any and all claims and causes of action that the Company may have for such activities. To the
fullest extent permitted by Applicable Law, the provisions of this Article apply equally to activities conducted in the future and that have been conducted in the past.
|
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Item 20.
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Indemnification of directors and officers.
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Item 21.
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Exhibits and Financial Statements Schedules.
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Exhibit No.
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Description
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Agreement and Plan of Merger, dated as of May 9, 2023, by and between the
Registrant, and H2B2 Electrolysis Technologies, Inc. (included as Annex A to the proxy statement/prospectus)
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Plan of Domestication, dated as of , 2023
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Amendment No. 1 to the Agreement and Plan of Merger, dated as of December
15, 2023, by and between the Registrant, and H2B2 Electrolysis Technologies, Inc. (included as Annex A-1 to the proxy statement/prospectus)
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Third Amended and Restated Memorandum and Articles of Association of the
Registrant (included as Annex F to the proxy statement/prospectus)
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Form of Certificate of Incorporation of H2B2 Electrolysis Technologies,
Inc., to become effective upon Closing (included as Annex G to the proxy statement/prospectus)
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Form of Bylaws of H2B2 Electrolysis Technologies, Inc., to become effective
upon Closing (included as Annex H to the proxy statement/prospectus)
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Specimen Unit Certificate of the Registrant
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Specimen Class A Ordinary Share Certificate of the Registrant
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Specimen Warrant Certificate of the Registrant
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Warrant Agreement, dated as of February 4, 2021, by and between Continental
Stock Transfer & Trust Company and the Registrant
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4.5*
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Specimen Common Stock Certificate of H2B2 Electrolysis Technologies, Inc.
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Form of Certificate of Domestication of RMG Acquisition Corp. III, to be
filed with the Secretary of the State of Delaware
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Exhibit No.
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Description
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4.7*
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Form of Amendment to Warrant Agreement by and between Continental Stock
Transfer & Trust Company and the Registrant (included as Annex J to the proxy statement/prospectus)
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5.1*
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Opinion of Skadden, Arps, Slate, Meagher & Flom (UK) LLP as to the
validity of the Surviving Corporation Common Stock
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Opinion of Skadden, Arps, Slate, Meagher & Flom LLP regarding certain
U.S. federal income tax matters
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Sponsor Support Agreement, dated as of May 9, 2023, by and among the
Registrant, RMG Sponsor III LLC and H2B2 Electrolysis Technologies, Inc. (included as Annex B to the proxy statement/prospectus)
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Company Stockholder Support Agreement, dated as of May 9, 2023, by and among
the Registrant, H2B2 Electrolysis Technologies, Inc. and the persons set forth on Schedule I thereto (included as Annex C to the proxy statement/prospectus)
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Form of Amended and Restated Registration Rights Agreement (included as
Annex D to the proxy statement/prospectus)
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Form of Lock-up Agreement (included as Annex E to the proxy
statement/prospectus)
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Letter Agreement, dated as of February 4, 2021, by and among the Registrant,
RMG Sponsor III, LLC and the Registrant’s officers and directors
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Investment Management Trust Account Agreement, dated February 4, 2021, by
and between Continental Stock Transfer & Trust Company and the Registrant
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Administrative Services Agreement, dated as of February 4, 2021, by and
between the Registrant and RMG Acquisition Management, LLC
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Sponsor Warrants Purchase Agreement, dated as of February 4, 2021, by and
between the Registrant and RMG Sponsor III, LLC
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Form of H2B2 Electrolysis Technologies, Inc. 2023 Incentive Award Plan
(included as Annex I to the proxy statement/prospectus)
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Employment Contract, dated as of June 27, 2016, by and between Anselmo
Andrade Fernández de Mesa and H2B2 Electrolysis Technologies, S.L.
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Common Stock Option Agreement, dated as of January 1, 2021, by and between
Anselmo Andrade Fernández de Mesa and H2B2 Electrolysis Technologies, Inc.
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Amendment to the Common Stock Option Agreement, dated as of January 1, 2021,
by and between Anselmo Andrade Fernández de Mesa and H2B2 Electrolysis Technologies, Inc.
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Letter Agreement, dated May 9, 2023, by and between Anselmo Andrade
Fernández de Mesa and H2B2 Electrolysis Technologies, Inc.
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Service Agreement as Sole Director, dated May 9, 2023, by and between
Anselmo Andrade Fernández de Mesa and H2B2 Corp, S.L.
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Employment Contract, dated June 7, 2016, by and between Florencio Ferrera
Saldaña and H2B2 Electrolysis Technologies, S.L.
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Exhibit No.
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Description
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Common Stock Option Agreement, dated July 1, 2021, by and between Florencio
Ferrera Saldaña and H2B2 Electrolysis Technologies, Inc.
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Employment Contract, dated October 1, 2016, by and between Felipe Benjumea
Llorente and H2B2 Electrolysis Technologies, S.L.
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Service Agreement, dated January 7, 2023, by and between Felipe Benjumea
Llorente and H2B2 Electrolysis Technologies S.L.
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Employment Contract, dated June 7, 2016, by and between Jose Javier Brey
Sánchez and H2B2 Electrolysis Technologies, S.L.
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Common Stock Option Agreement, dated January 1, 2021, by and between Jose
Javier Brey Sánchez and H2B2 Electrolysis Technologies, Inc.
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Service Agreement, dated December 15, 2022, by and between Antonio Vázquez
Romero and H2B2 Electrolysis Technologies, S.L.
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Non-Residential Lease Agreement, dated July 8, 2021, by and between VGP Park
Sevilla Dos Hermanas, S.L.U. and H2B2 Electrolysis Technologies, S.L.
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Sublease Agreement, dated July 10, 2020, by and between Bar 20 Dairy, LLC
and H2B2 USA, LLC
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Solar Energy Systems Sublease, dated June 23, 2022, by and between Bar 20
Dairy, LLC and H2B2 USA, LLC
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Supply Agreement, dated June 19, 2020, by and among Giner ELX, Inc. (and
acquired and assumed by Plug Power Inc.) and H2B2 Electrolysis Technologies, Inc.
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Public Deed of Sale and Purchase of Shares of H2B2 Electrolysis
Technologies, Inc., dated May 30, 2023, by and among Arraut Y Sala Reixachs, S.L.P, as the bankruptcy administration, Ardachon, S.L., as the seller, and H2B2 Electrolysis Technologies, Inc., as the buyer
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Loan Agreement, dated May 30, 2023, by and between Apenet, S.L.U. and H2B2
Electrolysis Technologies, Inc.
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Service Agreement, dated November 2, 2023, by and between H2B2 Electrolysis
Technologies, Inc. and CHRS Arquitectos.
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List of Subsidiaries of H2B2 Electrolysis Technologies, Inc.
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Consent of Marcum LLP
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Consent of RSM US LLP
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23.3*
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Consent of Skadden, Arps, Slate, Meagher & Flom (UK) LLP (included as
part of Exhibit 5.1)
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Power of Attorney (included on signature page to this registration
statement)
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Consent of Anselmo Andrade Fernández de Mesa to be Named as a Director
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Consent of Antonio Vázquez Romero to be Named as a Director
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Consent of Blanca de Porres Guardiola to be Named as a Director
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Consent of Felipe Benjumea de Porres to be Named as a Director
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Exhibit No.
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Description
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Consent of Guillermo Delclaux Lezama Leguizamón to be Named as a Director
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Consent of Manuel Delclaux Lezama Leguizamón to be Named as a Director
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Consent of Iván E. Mercado to be Named as a Director
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Consent of Robert S. Mancini to be Named as a Director
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101.INS
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Inline XBRL Instance Document
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101.SCH
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Inline XBRL Taxonomy Extension Schema Document.
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101.CAL
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Inline XBRL Taxonomy Extension Calculation Linkbase Document.
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101.DEF
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Inline XBRL Taxonomy Extension Definition Linkbase Document.
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101.LAB
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Inline XBRL Taxonomy Extension Label Linkbase Document.
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101.PRE
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Inline XBRL Taxonomy Extension Presentation Linkbase Document.
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Filing Fee Table
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*
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To be filed by amendment.
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**
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Previously filed.
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†
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Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Registrant agrees to furnish
supplementally a copy of any omitted schedule or exhibit to the SEC upon request.
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^
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Portions of this exhibit have been redacted in compliance with Regulation S-K Item 601(b)(10).
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#
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Indicates a management contract or compensatory plan, contract or arrangement.
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(1)
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Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on August 7, 2023.
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(2)
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Incorporated by reference to the Exhibit 4.1 filed with Amendment No. 1 to the Form S-1 filed by the Registrant on February 2,
2021.
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(3)
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Incorporated by reference to the Exhibit 4.2 filed with Amendment No. 1 to the Form S-1 filed by the Registrant on February 2,
2021.
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(4)
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Incorporated by reference to Exhibit 4.1 filed with the Registrant’s Current Report on Form 8-K filed on February 4, 2021.
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(5)
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Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on February 4, 2021.
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Item 22.
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Undertakings.
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RMG Acquisition Corp. III
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|||
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By:
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/s/ Robert S. Mancini
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Name:
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Robert S. Mancini
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Title:
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Chairman of the Board and Chief Executive Officer
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Signature
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Title
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Date
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/s/ Robert S. Mancini
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Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
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December 18, 2023
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Robert S. Mancini
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*
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President, Chief Operating Officer
and Director
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December 18, 2023
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Philip Kassin
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*
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Chief Financial Officer (Principal Financial and Accounting Officer)
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December 18, 2023
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Wesley Sima
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*
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Director
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December 18, 2023
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Craig Broderick
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*
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Director
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December 18, 2023
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W. Thaddeus Miller
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*
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Director
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December 18, 2023
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Catherine D. Rice
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*By:
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/s/ Robert S. Mancini
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Name: Robert S. Mancini
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Title: Attorney-in-fact
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Exhibit 10.22
CERTAIN INFORMATION HAS BEEN OMITTED FROM THIS EXHIBIT PURSUANT TO REGULATION S-K, ITEM 601(B)(10) BECAUSE IT IS
BOTH NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED.
IN ADDITION, CERTAIN PERSONALLY IDENTIFIABLE INFORMATION HAS BEEN OMITTED
FROM THIS EXHIBIT PURSUANT TO ITEM 601(A)(6) OF REGULATION S-K.
[***] INDICATES THAT INFORMATION HAS BEEN REDACTED
NON-RESIDENTIAL LEASE AGREEMENT
VGP PARK SEVILLA DOS HERMANAS, S.L.U.
as Landlord
and
H2B2 ELECTROLYSIS TECHNOLOGIES, S.L.
as Tenant
DATE:
TABLE OF CONTENTS
1. | DEFINITIONS | 5 |
2. | PURPOSE OF THE LEASE | 9 |
3. | PREVIOUS ACCESS AND CONDITIONING WORKS | 10 |
4. | LANDLORD’S WORKS | 11 |
5. | RIGHT OF ACCESS, PARKING SPACES | 12 |
6. | DELIVERY OF THE PROPERTY | 12 |
7. | LEASE TERM | 13 |
8. | RENT | 15 |
9. | LEASE CHARGES | 16 |
10. | PAYMENT | 18 |
11. | VALUE ADDED TAX (VAT) | 19 |
12. | WORKS, MAINTENANCE AND REPAIRS | 19 |
13. | GUARANTEES | 20 |
14. | INSURANCE | 21 |
15. | OTHER RIGHTS AND OBLIGATIONS OF THE TENANT | 21 |
16. | OTHER RIGHTS AND OBLIGATIONS OF THE LANDLORD | 23 |
17. | INFORMATION AND DISTINCTIVE SIGNS | 24 |
18. | TERMINATION AND EXTINCTION | 24 |
19. | RETURN OF THE PROPERTY AT THE END OF THE LEASE | 26 |
20. | APPLICABLE LAW AND JURISDICTION | 27 |
21. | FINAL PROVISIONS | 27 |
ANNEX 1 | ||
LAND REGISTRY EXCERPT | ||
ANNEX 2 | ||
TECHNICAL SPECIFICATIONS | ||
ANNEX 3 | ||
ILLUSTRATIVE PLANS OF THE PROPERTY | ||
ANNEX 4 | ||
TABLE OF LEASE CHARGES | ||
ANNEX 5 | ||
CHANGE ORDER PRO-FORMA | ||
ANNEX 6 | ||
TAX CERTIFICATES AND SEPA MANDATE |
ANNEX 7 | |
PROOF OF PAYMENT OF THE LEGAL DEPOSIT | |
ANNEX 8 | |
DETAILS OF THE TENANT FOR THE LEASE STUDY |
THIS LEASE IS ENTERED INTO BETWEEN:
ON THE ONE HAND, Mr. Jan Van Geet [***]
Acting in the name and on behalf of the company VGP PARK DOS HERMANAS, S.L. [***]
He is acting in his capacity as sole director of the Company.
Hereinafter “VGP” or the “Landlord”.
AND, ON THE OTHER HAND, Mr. FLORENCIO-SALVADOR FERRERA SALDAÑA, [***]
Acting in the name and on behalf of the company H2B2 ELECTROLYSIS TECHNOLOGIES, S.L. [***].
He is acting as sole director of the company by virtue of a public deed granted on July 8, 2021 before the Notary of Seville, Mr. Rafael José Díaz Escudero, under number 1,181 of his public records.
Hereinafter, “H2B2” or the “Tenant”, and, together with the Landlord, the “Parties”.
The Parties mutually and expressly acknowledge the legal capacity necessary to sign this non-dwelling lease agreement and, for this purpose:
EXHIBIT:
(A) | That the Landlord owns the following property (the “Plot”): |
Registry Description: According to the Land Registry excerpts attached as ANNEX 1.
Enrollment: According to the registry information notes attached as ANNEX 1.
Cadastral References: 550100800000000001AQ .
Attached as ANNEX 1 Land Registry Excerpt.
(B) | The Landlord is developing a logistics park consisting of several buildings on the Plot (the “Logistics Park”), including building B (the “Building”), the technical specifications of which are attached as ANNEX 2 as shown in the plan attached as ANNEX 3, and which is configured as a type B industrial building in a multi-tenant regime suitable to house an activity of average risk 5. |
(C) | That the Landlord is interested in leasing a module within the Building (the “Property”) with a storage area of 3,189.20 m2 (the “Warehouse”) and an office area of 620.01 m2 (the “Offices”) and the Tenant is interested in taking said Property under lease in the state in which it is, therefore, both Parties agree to enter into this non-residential lease agreement (the “Agreement” or the “Lease”), which shall be governed in accordance with and subject to the following |
CLAUSES
1. | DEFINITIONS |
1.1 | The terms defined below or in general in this Agreement, when written in capital letters and unless otherwise deduced from the context in which they are used, shall have the meaning set forth below in this Agreement: |
“Previous Access” shall have the meaning set forth in Clause 3.1.
“Amounts Assimilated to the Rent” means the Lease Charges, as referred to in Clause 9.1 and any amount to be paid by the Tenant in accordance with Clauses 9.8 and 12.1 (repair costs carried out by the Landlord instead of the Tenant).
“Lease Charges” shall have the meaning set forth in Clause 9.2.
“Civil Code” means the Spanish Civil Code.
“Agreement” means this Agreement, including all the annexes that form part of it.
“Landlord’s Account” means the bank account opened in the name of the Landlord at Banco Sabadell with IBAN [***] and BIC [***], designated for the payment of the Legal Deposit, or any other account designated for the payment of the invoices sent by the Landlord to the Tenant.
“Tenant’s Account” means the bank account opened in the name of the Tenant at Banco Bilbao Vizcaya Argentaria with IBAN [***], designated for the direct debit of the payment of the Rent and Operating Expenses by means of a SEPA command attached in ANNEX 6.
“Major Defects” means any defect in the Property that prevents the Tenant from properly occupying the Property in accordance with the provisions of this Agreement.
“Minor Defects” means any defect other than a Major Defect.
“Right of Access” means the right that corresponds to the managers, employees, shareholders, customers or visitors of the Tenant to access the Building through the Plot, only through the designated areas and in the stipulated manner.
“Business Day” means any calendar day other than Saturday, Sunday or public holiday in Spain.
“Building” shall have the meaning set forth in Exhibit (B).
“Technical Specifications” means the technical specifications of the Offices attached as ANNEX 2.
“Independent Expert” means an internationally well-known expert of recognized prestige duly qualified to provide consulting services in technical, constructive or other matters, to be appointed by the Parties by mutual agreement.
“Delivery Date” means November 29, 2022, date on which the Warehouse area must be delivered to the Tenant.
“Alternative Delivery Date” means the alternative date agreed by the Parties for the delivery of the Property and, in the absence of agreement between the Parties, the date set by the Landlord for the delivery of the Property, which must be notified to the Tenant at least five (5) Business Days in advance.
“Landlord’s Works Completion Date” shall have the meaning set forth in Clause 4.3.
“Start Date” means the date on which the Lease Term will begin in accordance with the provisions of Clause 7.1.
“Legal Deposit” means the deposit of two (2) monthly Rents required by Article 36 of the Urban Leases Act.
“Force Majeure” means those events beyond the will of the relevant Party that are unavoidable and that such Party cannot remedy, and that prevent the said Party from fulfilling the obligations under this Agreement, including in relation to the construction of the Building and/or the execution of the Landlord’s Works, the appearance of reservoirs or other findings belonging to archaeological heritage, the delay in the granting of the corresponding work licenses by the relevant public administration, the interference of the Tenant’s Conditioning Works in the Construction of the Building and/or the execution of the Landlord’s Works, government restrictions or controls, strikes in the construction sector (general or local) or in any other related sector that negatively affect the execution of the construction works of the Building and/or the execution of the Landlord’s Works, the suspension or judicial or administrative stoppage of the construction works of the Building and/or the execution of Landlord’s Works (unless such suspension or stoppage is a result of a breach by the Landlord of its legal obligations or of the emanating from this Agreement), hostile acts, enemy attacks, citizen disturbances, fires, natural disasters and earthquakes, as well as the following adverse weather conditions: wind exceeding 40 km/h, temperatures below -1º C in the morning, snow and/or precipitation exceeding 10mm/h during the day.
“Bank Guarantee” shall have the meaning set forth in Clause 13.
“Operating Expenses” shall have the meaning set forth in Clause 9.1.
“Incentive” means the incentive granted by the Landlord to the Tenant in accordance with Clause 8.4.
“Update Index” means the Consumer Price Index for the national set published by the National Institute of Statistics (INE). In the event that it is no longer published by the INE or by the bodies that have replaced it, the index that has officially replaced it shall apply and, failing that, any other official publication or data indicating the variation experienced by the cost of living; and, ultimately, it will be determined by an independent expert appointed for this purpose by both Parties.
“Property” means the property described in ANNEX 2 and indicated in red and yellow in ANNEX 3.
“Urban Leases Act” means Law 29/1994, of 24 November, on Urban Leases.
“Activity License” means all licenses, permits and other administrative authorizations that are necessary in accordance with the regulations applicable to the Property for the Permitted Use that the Tenant will make of the Property, as well as for the operation of the facilities and services that serve exclusively the Tenant (such as, but not limited to, environmental, start-up and opening licenses).
“License or Communication of Occupation” means the license or communication required by the applicable regulations for the first occupation of the Building.
“Work Modifications” shall have the meaning set forth in Clause 2.9.
“Guaranteed Obligations” means any pecuniary obligation or any amount that the Tenant owes at any time in accordance with or in relation to this Agreement, including the Rent, the Amounts Assimilated to the Rent and any compensation, delay interest, payments, contractual penalties and/or claims for unfair enrichment.
“Conditioning Works” means the works carried out by the Tenant in the Property in relation to the construction or installation of equipment, which have been approved by the Landlord and which are necessary for the development of the Tenant’s activities in the Property.
“Landlord’s Works” shall have the meaning set forth in Clause 4.
“Change Order” means the document signed by the authorized representatives of both Parties in accordance with the pro-forma attached as ANNEX 5, in which the Work Modifications must be documented.
“Plot” shall have the meaning set forth in Exhibit (A).
“Logistics Park” shall have the meaning set forth in Exhibit (B).
“Fixed Part of the Rent” means the part of the Rent that is stipulated as fixed in Clause 8.1.
“Supplementary Part of the Rent” shall have the meaning set forth in Clause 8.4.
“Parking Spaces” means the total number of 20 private car parking spaces, marked in blue in ANNEX 3.
“Lease Term” shall have the meaning set forth in Clause 7.2.
“Delivery Protocol” shall have the meaning set forth in Clause 6.1.
“Rent” shall have the meaning set forth in Clause 8.1.
“Major Repairs” means repairs that affect (i) walls and load structures, beams, stairwells or any other main structural elements of the Building, (ii) Building Decks; (iii) Building Floor, (iv) Parking Spaces and rolled accesses; (v) central distribution networks (electricity, gas, water and drainage); and (vi) heating, ventilation and air conditioning. Repairs of any element and/or device mentioned in this definition that is found in the Property as a result of Work Modifications, the Additional Requirements or because it has been installed and/or left in the Property at the request of the Tenant shall not be considered Major Repairs.
“Minor Repairs” means any repair other than a Major Repair, such as, including, but not limited to: (i) replacement and repair of broken glass and mirrors; (ii) replacement and repair of window and door closure systems, hinges, anchors, locks and plumbing (iii) repairs of internal paint and new paint in the event that the quality of the previous one has been substantially spoilt, (iv) ordinary cleaning of windows (both inside and outside), (v) repairs of any items and/or devices installed under the Work Modifications or Additional Requirements, (vi) repair of any element and/or device installed and/or left in the Building by the Tenant or at the request of the Tenant.
“Additional Requirements” means (i) any obligation imposed by the public administration on the Landlord or any condition for the occupancy of the Property (such as, for example, provide the Property with special equipment) coming from the Work Modifications, special requests of the Tenant or of the Tenant’s own activity; and/or (ii) any action required for the occupancy of the Property that exceeds the obtaining of the first license of occupation or, if applicable, of making the first communication of occupation.
“Landlord’s Insurance” shall have the meaning set forth in Clause 14.1.
“Distinctive Sign” shall have the meaning set forth in Clause 17.1.
“Guaranteed Amount” shall have the meaning set forth in Clause 13.3.
“Permitted Use” means the use of design, calculation and engineering of hydrogen production systems based on electrolysis processes, as well as the assembly and testing of such hydrogen production equipment prior to distribution to the end customer.
1.2 | Where this Agreement refers to: |
(a) | Legal entities, it shall be understood that it also includes the legal successors of said legal entities; |
(b) | A public administration or authority and any competence or activity thereof, shall be understood to also comprise the public administration or authority to which such competition or activity is transferred; |
(c) | A price index shall be understood to also comprise the price index that would formally replace it or, in the absence of formal substitution, the one whose purpose is the closest; |
(d) | Daily Operating Expenses or Rent, one month is considered to have thirty (30) days; |
(e) | Monthly or daily Rent (either the Fixed Part of the Rent or the Supplementary Part of the Rent) or monthly or daily Operating Expenses as a basis for the calculation of any amount, shall always mean the amount of Rent or Operating Expenses applicable on the day on which the assumption giving rise to such calculation takes place, although, to that end, only the amounts reflected in this Agreement shall be taken into account, without taking into account any partial or provisional modifications or adjustments to the Rent. |
(f) | Lease, it shall be understood that it refers to this Lease. |
1.3 | Except as expressly provided otherwise, any reference to Clauses, paragraphs and Annexes made in this Agreement shall be understood to refer to the Clauses, paragraph and Annexes of this Agreement. |
1.4 | All Annexes to this Agreement are part of this Agreement. |
2. | PURPOSE OF THE LEASE |
2.1 | The Landlord hereby leases the Property to the Tenant, who accepts it, so that the Tenant can carry out in the Property the Permitted Use and the corresponding administrative tasks after the completion of the Conditioning Works by the Tenant and obtaining the relevant authorizations. |
For the avoidance of doubt:
(a) | The access areas indicated in color in the draft attached in Annex 3 are part of the Building. |
(b) | The Property is leased to the Tenant with the connections to the general supplies and equipment of the Building and without prejudice to the Tenant’s power to install the equipment and machinery that are necessary for the development of its activities, whose installation will correspond to the Tenant itself (and that will be owned by the Tenant) under the terms stipulated in this Agreement. |
2.2 | The Tenant may only use the Property for the Permitted Use and always subject to the License of Occupation and the Activity License. |
2.3 | The Tenant may only develop the Permitted Use in the Property. Any change in whole or in part to the Permitted Use may only be made by novation in writing of this Agreement. |
2.4 | This Agreement is valid and comes into force as of today’s date and the Parties expressly declare that there is no need for any further ratification after the delivery of the Property to the Tenant. Consequently, all rights, obligations and waivers included in this Agreement become final as of today, without prejudice to the fact that the effectiveness of certain clauses is deferred to a later time (delivery, agreements on Rent payments, start of the Lease Term, etc.). |
2.5 | It is expressly stated for the record that the purpose of this Agreement constitutes the Property in its entirety, considered as an indivisible whole, comprising the Warehouse and the Offices referred to in Exhibit (B). The Tenant may not reduce the purpose of the Lease in any way during the term of the Agreement and is obliged to pay the full Rent in accordance with the provisions of this Agreement. |
However, the Landlord expressly reserves the option to exclude from the Lease the use of the Cover Surface Area, in the event that the Landlord wishes to exploit it directly or assign its use by the title it deems appropriate to any third parties of its free choice (such as investors, agents or operators in the renewable energy market) for the facility, maintenance and exploitation of solar thermal or photovoltaic energy capture systems, with or without connection to the electrical grid (such as thermal panels and/or photovoltaic plates) or for the production of electrical energy on a special basis, which the Tenant accepts and consents to for all purposes.
2.6 | The Tenant expressly accepts the classification, rating and urban planning situation of the Building (in particular, for the purposes of the uses permitted to be implemented under this Agreement), assumes the regulatory provisions and limitations that may derive from the classification, rating and urban planning situation for the development of the Permitted Use and undertakes to comply with said regulatory provisions and limitations during the term of this Agreement. |
2.7 | In the event that one or more Additional Requirements are imposed, the Tenant undertakes from now on to bear the costs that may derive from the execution or implementation of said Additional Requirements and undertakes to pay them within fifteen (15) Business Days of receipt of the corresponding payment request from the Landlord. The Completion Date of the Landlord’s Works will be postponed for the period necessary to comply with the Additional Requirements. |
2.8 | The Tenant agrees to collaborate with the Landlord to the extent that such collaboration is necessary for the completion of the Landlord’s Works and the processing of the License of Occupation. The Tenant agrees to make available to the Landlord all plans and specifications of the Conditioning Works that the Landlord may require. |
2.9 | During the execution of the Landlord’s Works, the Tenant may request the Landlord to make constructive modifications to the Property (the “Work Modifications”). The Landlord may refuse to make such Work Modifications if they differ materially from the conditions and limits established in the Technical Specifications. The Landlord shall inform the Tenant of both the price and term of execution of the Work Modifications and the impact that the Work Modifications may have on the Landlord’s Works Completion Date. If the Parties reach an agreement on the price, term and scope of the Work Modifications, they must confirm said agreement in writing by formalizing a Change Order. If the execution of the Work Modifications affects the Completion Date, the Parties shall establish the new Landlord’s Works Completion Date in the Change Order. The Landlord shall not be obliged to initiate the Work Modifications until the corresponding Change Order has been formalized between the Parties. |
2.10 | The Landlord shall execute the Work Modifications at its own expense for the price agreed in the Change Order (the “Work Modification Costs”). Unless otherwise agreed by the Parties, the Work Modification Costs shall be taken into account in the calculation of the Supplementary Part of the Rent in accordance with Clause 8.5. |
2.11 | If any of the causes of termination of this Agreement in accordance with Clauses 18.2 or 18.4 occurs before the Start Date, the Landlord shall have the right to demand from the Tenant, who agrees, a conventional penalty equal to 150% of the Work Modification Costs and of the costs motivated by the Additional Requirements referred to in Clause 2.7. |
3. | PREVIOUS ACCESS AND CONDITIONING WORKS |
3.1 | Provided that the Tenant so requests in writing to the Landlord and has delivered the guarantee provided for in Clauses 13.1 and 13.2, the Landlord shall provide the Tenant, as soon as practicable and prior to the Delivery Date, with access to the Building and the Property in order for the Tenant to carry out the Conditioning Works necessary for the start of its activity (the “Previous Access”). |
3.2 | Previous Access will be conducted on the following terms: |
3.2.1 | Previous Access shall determine the application of Clauses 12.1, 12.2 and 14.2 to such situation and concordant provisions. |
3.2.2 | The Parties will sign a certificate in order to record the state in which the Property is and it will have the effects of the certificate of delivery, in particular for the purposes of the state in which the Building must be restored in the event of termination of the Lease or in the event of breach by the Tenant of its obligation to take it in possession on the Delivery Date. |
3.2.3 | Access shall be limited to the Warehouse part and the tasks necessary for the execution of the Conditioning Works and shall not in any way lead to the taking of possession. |
3.2.4 | Previous Access will always be carried out by the Tenant in accordance with the applicable regulations and subject to the determinations made by the delegated promoter of the Building, as well as the construction management and the health and safety coordinator. The provisional supplies required by the Tenant shall be at its own expense in any case. |
3.3 | The Tenant shall carry out the Conditioning Works in the following terms: |
3.3.1 | The Tenant shall carry out the Conditioning Works in a professional manner and without hindering or impeding the work related to the Landlord’s Works. If the Landlord’s Works are affected by the Conditioning Works, the Landlord’s Works Completion Date shall be extended for a period equal to the period for which the Landlord’s Works are affected by the Conditioning Works. |
3.3.2 | In its capacity as promoter of the Conditioning Works, the Tenant shall be solely and exclusively responsible for (i) complying with the regulations governing their execution, in particular in administrative matters and the prevention of risks in the workplace, with total indemnity of the Landlord and (ii) paying any cost, expense or consumption resulting from the Conditioning Works. If necessary, a safety and health coordinator will be appointed whose cost will be borne by the Tenant. |
3.3.3 | Each of the Parties must appoint a representative and contact in order to maintain adequate coordination between the execution of the Landlord’s Works and the execution of the Conditioning Works. In the event of a discrepancy in relation to the coordination, the final decision shall rest with the Landlord. |
3.3.4 | The Tenant must provide the Landlord, prior to the Previous Access, with the plans and documentation related to the Conditioning Works (the “Conditioning Project”), so that they can be reviewed by the Landlord. The Conditioning Project must comply with the Technical Specifications. The Tenant shall accept any reasonable observation that the Landlord may make about the Conditioning Project and may not carry out any Conditioning Work rejected by the Landlord. |
4. | LANDLORD’S WORKS |
4.1 | The Parties expressly agree that the Landlord shall execute at its own cost the construction work of the Offices of the Property, which shall form an integral part of the Property and shall be the property of the Landlord (the “Landlord’s Works”). |
4.2 | During the Landlord’s Works, the Landlord undertakes to: |
(a) | Comply with the Technical Specifications attached as Annex 2; |
(b) | Act professionally and in accordance with usual practice in the construction sector; |
(c) | Proceed in accordance with the applicable regulations and the permits granted for the Landlord’s Works. |
4.3 | The Landlord shall make its best efforts to complete the Landlord’s Works within four (4) months from today's date (the “Landlord’s Works Completion Date”). Once the Landlord’s Works have been completed, the Landlord shall notify the Tenant without delay. |
If the Landlord's Works are delayed due to Force Majeure, the Landlord shall notify the Tenant of such circumstance, indicating the delay provided for on the Landlord's Works Completion Date. In the event of disagreement by the Tenant, each of the Parties shall be entitled to submit the discrepancy to the Independent Expert.
The Landlord states that it has made its best efforts to take into account the COVID-19 pandemic and its known consequences as of the date of signature in the planning of the Landlord’s Works and in the estimation of the Landlord’s Works Completion Date. However, the Parties acknowledge and agree that it is not possible to fully anticipate the actual impact that the COVID-19 pandemic and that the measures to be taken to counter it will have in the process of executing the Landlord's Works. So, the Parties agree that despite being aware of the existence of the pandemic and the corresponding measures taken prior to the date of signing this Agreement, any event that results from COVID-19 infection and/or countermeasures that could not be fully predicted or anticipated prior to the signing of the Agreement (such as prolonged inactivity by competent authorities, work quarantines, etc.) will be considered a Force Majeure event:
(a) | for which Landlord shall not be liable; |
(b) | for which all actions and claims for damages of the Tenant against the Landlord are hereby excluded; and |
(c) | for which the Landlord's Works Completion Date will be extended for a reasonable period of time according to the period of time in which the execution of the Landlord's Works has been affected, without the Tenant being able to terminate or withdraw from the Agreement for this reason. |
5. | RIGHT OF ACCESS, PARKING SPACES |
5.1 | The Landlord hereby grants the Tenant the Right of Access for the purposes of this Lease and during its term. In the exercise of the Right of Access, the Tenant: |
(a) | shall avoid causing any kind of disturbance and damage to the Landlord and third parties who may enjoy the same right; |
(b) | ensure that those persons to whom the Right of Access is also granted proceed equally. |
5.2 | The Tenant undertakes to compensate the Landlord for any type of damage and/or harm suffered as a result of the actions or omissions that any person (other than the Tenant and its employees) may cause to the Landlord when exercising the Right of Access under this Agreement. To this end, the Landlord shall assign to the Tenant all actions arising from the damages caused by said person. |
5.3 | The Tenant may only park vehicles, for the purposes of this Lease and during its term, in the Parking Spaces. The Parking Spaces are an accessory part of the Property. |
6. | DELIVERY OF THE PROPERTY |
6.1 | The Landlord must deliver the Property (without the surface area of Offices) to the Tenant on the Delivery Date. The Parties shall prepare a Delivery Protocol on the occasion of the delivery of the Property (“Delivery Protocol”). |
6.2 | If the Tenant does not attend to the delivery of the Property on the Delivery Date, the Property will be considered to have been accepted by the Tenant without reservation. In this case, the Landlord will formalize the Delivery Protocol unilaterally, and must record the Tenant’s absence in the Delivery Protocol itself. |
6.3 | The Tenant shall be obliged to accept the Property unless it presents Major Defects. It shall be the responsibility of the Landlord to remedy any Minor Defects that have been included in the Delivery Protocol within a maximum period of fifteen (15) Business Days from the execution of the Delivery Protocol, unless the Parties agree otherwise in this regard. It shall be the responsibility of the Landlord to eliminate any Major Defects within a period appropriate to the nature of the Major Defect, but not more than thirty (30) Business Days from the time the Major Defect has been notified by the Tenant. By signing the Delivery Protocol, it will be understood that the Parties confirm that the Property has been delivered free of any defects other than those that the Parties have collected in the Delivery Protocol. |
6.4 | Any dispute that may arise between the Parties in relation to the nature of the defects will be submitted to the Independent Expert, who will resolve on the nature of each defect. The Parties shall bear the Independent Expert’s fees equally. The Party whose position was confirmed by the Independent Expert may, within five Business Days following the decision of the Independent Expert, claim from the other Party the reimbursement of its participation in the Independent Expert’s fees within a period not exceeding ten (10) Business Days following the request of the Party whose position had been estimated. |
6.5 | If the delivery of the Property does not take place on the Delivery Date for the reason provided for in Clauses 6.3 and 6.4, the delivery of the Property will take place on the Alternative Delivery Date. Clauses 6.1 to 6.4 shall also apply to the delivery of the Property on the Alternative Delivery Date. |
6.6 | The Tenant assumes full responsibility for obtaining the Activity License and will compensate the Landlord for any type of cost, harm, damage and/or loss arising from lack of obtaining or delay in obtaining it. In the event of failure to obtain or loss of efficacy of the Activity License, the Tenant may not terminate this Agreement or stop paying the Rent or request the modification of the agreed contractual conditions, except in the event that the lack of Activity License or its subsequent cancellation or revocation is attributable to the Landlord. The Tenant shall provide the Landlord with a copy of its Activity License and any documentation related to the Activity License. |
The Tenant knows and accepts that obtaining the Activity License requires the Tenant to obtain a favorable resolution issued by the competent administration upon the request for exceptionality to the application to the Property of Royal Decree 2267/2004, of December 3rd, approving the Fire Safety Regulations in Industrial Establishments (“RSCIEI”), by submitting to the competent authorities a services study that justifies equivalent security in terms of the Tenant’s activity as provided for in the RSCIEI itself (the “Services Study”). For these purposes, the Landlord has agreed to (i) draft a Services Study within sixty (60) days from the date on which the Tenant provides the Landlord with the detail of the Tenant’s activity on the points detailed in ANNEX 8 and (ii) to submit said Services Study to the competent administration in instrumental form, for the mere purposes of its administrative processing, at the expense and risk and at the cost of the Tenant itself. The Tenant, for its part, undertakes to comply, at its own expense, with any and all requirements that the competent administration may make in relation to the request for exceptionality and its favorable resolution mentioned above.
7. | LEASE TERM |
7.1 | The Lease Term begins on the date that has been recorded for this purpose in the Delivery Protocol of the Warehouse part of the Property, in the event that its delivery is carried out on a date other than the Offices part of the Property (the “Start Date”). |
7.2 | The Lease Term is set within the determined period of five (5) years from the Start Date. |
7.3 | The Lease Term shall be automatically extended for successive periods of three (3) years each until the Lease reaches a maximum duration of eleven (11) years, unless the Tenant notifies the Landlord in writing, at least six (6) months prior to the end of the term of each of the extensions, of its decision not to extend it. |
7.4 | For the avoidance of doubt, in the event that the Landlord does not receive the notification referred to in the previous Clause, it shall be understood that the Tenant has granted its agreement to the extension of the Agreement in the indicated terms. The duration of each extension shall be mandatory. |
7.5 | This Lease may only be terminated prior to the end of the Lease Term for the reasons provided for in Clause 18. This Lease may only be automatically extended in the event and in the terms established in Clause 7.3, without the tacit renewal provided for in Article 1566 of the Civil Code being applicable. |
7.6 | The Lease Term and the term of any of the extensions that are applicable in accordance with Clause 7.3 are mandatory for both parties, so that the Tenant may not terminate the Lease prior to the end of the Lease Term or any of the extensions that are in progress. The Tenant expressly accepts that the mandatory nature of the initial Lease Term and, if applicable, of any of its extensions constitutes an essential element of this agreement, determining the Landlord’s willingness to proceed with the execution of this Lease. Consequently, any waivers, unilateral or early termination of this Agreement by the Tenant that takes place prior to the end of the Lease Term or any of its ongoing extensions - regardless of whether it occurs under applicable law (e.g. insolvency proceedings)- shall be considered a serious breach of this Agreement and shall entitle the Landlord to demand from the Tenant a conventional penalty consisting of an amount equal to the amount of the Rent corresponding to the Lease Term or the ongoing extension remaining to be fulfilled (plus the one that is applicable, where appropriate, pursuant to Clause 2.11 and/or 18.6). This conventional penalty has been freely agreed by the Parties and constitutes the amount in which both quantify the damages caused to the Landlord for the breach of this essential obligation to remain for the entire Lease Term and, where applicable, the extensions. The Tenant expressly accepts the proportionality of this penalty in consideration of the essential nature of the Lease Term or any of its extensions and expressly waives the right to exercise any actions aimed at the judicial moderation of the penalty or to delay or avoid its fulfillment and execution. |
7.7 | [***] |
8. | Rent |
8.1 | The Tenant undertakes to pay the Rent for the lease of the Property from the Start Date. The Rent consists of the Fixed Part of the Rent and the Supplementary Part of the Rent. The form of calculation of the amounts corresponding to the Fixed Part of the Rent is established in the following table: |
Use of the Property and Purpose | Color in Plan | Total Area (m2) |
Price per unit (EUR/m2/month) |
Fixed Part of Monthly Rent (EUR) |
Warehouse | yellow | 3,189.20 | [***] | [***] |
Offices | red | 620.01 | [***] | [***] |
Fixed Part of Total Monthly Rent: | [***] | |||
x 12 | ||||
Fixed Part of Annual Rent: | [***] |
8.2 | The Fixed Part of the Rent will be adjusted to adapt to the real gross surface of the Property, which will be verified at the completion of the Landlord’s Works. The gross surface will be measured in accordance with DIN 277 (BGF). In the event that the Parties do not carry out the verification of the actual gross surface, the Fixed Part of the Rent shall be determined according to the surfaces reflected in the previous table. |
8.3 | The Landlord shall apply the Value Added Tax (“VAT”) to the amounts referred to above, calculated in accordance with the regulations applicable to the Rent. |
8.4 | The Landlord hereby grants the Tenant an incentive in the amount of four (4) months of Fixed Part of the Rent for the Warehouse and four (4) months of Fixed Part of the Rent for the Offices, that is, the total amount of [***] EUR (the “Incentive”). |
The Incentive shall be gradually allocated each month to the payment of the Rent until the amount of the Incentive is depleted, operating as a lack of the Rent corresponding to each part of the Property; and
8.5 | In the event that there are Work Modifications Costs and the Parties have not agreed otherwise, the Tenant shall be obliged to pay the Supplementary Part of the Rent referred to in Clause 8.1. The amount of the Supplementary Part of the Rent will be calculated according to the following formula: |
Supplementary Part of the Rent = | WMC x C |
T |
WMC | - Work Modifications Costs |
C | - Capitalization factor of [***] |
T | - Number of months of the Lease Term excluding extensions (60) |
8.6 | The Rent will be updated annually upwards in accordance with the variation experienced by the Update Index. The Rent update will take place on January 1 of each calendar year from January 1, 2024 (date on which the first Rent update will take place) by applying the percentage variation experienced by the Update Index during the immediately preceding calendar year. The Landlord shall inform the tenant of the increase in the Rent by sending an invoice with the updated Rent and, at the same time, an invoice for the amounts not paid for the Rent in what had been increased from January 1 of the year in question to the date of the invoice. The Rent increases resulting from the update system stipulated in this Clause will be applied cumulatively throughout the term of the Lease. |
8.7 | The Rent update stipulated in the previous Clause will not take place when the variation experienced by the Update Index during the calendar year is negative (deflation) or equal to zero. |
8.8 | The Rent update constitutes an essential element of this agreement, determining the Landlord’s willingness to proceed with the execution of this Lease. Consequently, the Parties expressly state that they consider the Rent update appropriate and that it will take place throughout the term of the Agreement. The Rent resulting from the update will be automatically mandatory for both Parties, without the need for notification or request by the Landlord. |
9. | LEASE CHARGES |
9.1 | During the term of the Lease, the Tenant shall pay the Landlord on a pro rata basis the amount of the Lease Charges, comprising (i) expenses incurred for the provision of use-related services, ownership, administration, repair and maintenance of the Building, as further explained in ANNEX 4, the costs of the Landlord’s Insurance and the Conservation Entity (the “Operating Expenses”), and (ii) the Real Estate Tax (IBI) that the Landlord must pay with respect to the Building (the “Property Taxes”). The services that are part of the Operating Expenses to be provided by third parties will be passed on without any additional charge and will be allocated to the Property on a proportional basis. |
9.2 | From the start of the Agreement, the Tenant must pay the Lease Charges, which are budgeted for the ongoing calendar year at €[***], excluding VAT, for each m2 of the Property for each calendar month. |
9.3 | In the event that any of the Operating Expenses correspond to services shared by the Tenant with other users of the Building or the Logistics Park, only the proportional part of the actual cost of such Operating Expenses shall be passed on to the Tenant, calculated based on the proportion that the surface of the Property saves with the total leased surface in (i) the Building or (ii) the Logistics Park or, if applicable, (iii) in other buildings participating in such shared services. |
9.4 | Within the maximum period of one hundred and twenty (120) days following the end of each calendar year, the budgeted Operating Expenses will be reconciled with those actually incurred in said period, for which purpose the Landlord will send the Tenant, before March 31 of the following year, a comparison of the amounts budgeted for each item and those actually incurred. |
The Tenant may, within thirty (30) days following the date on which it receives the comparison, access the accounting documents that support the Operating Expenses, at the written request of the Tenant sent for this purpose at least five Business Days in advance.
In this regard,
9.4.1 | If the total payments made by the Tenant on account of Operating Expenses on the basis of the annual budget are lower than those actually incurred, the Tenant shall be obliged to pay the difference within ten (10) Business Days from the receipt of the corresponding liquidation invoice and the budget of the Lease Charges for the year in which said liquidation is made shall be adjusted with effects of January 1 to the amount resulting from the reconciliation |
9.4.2 | If, on the contrary, the total payments made by the Tenant on account of Operating Expenses on the basis of the annual budget are greater than those actually incurred, the Landlord will retain said excess to apply it to the next payments on account of Operating Expenses on the basis of the annual budget for the current year, to the extent they reach |
9.5 | The Tenant shall be responsible for the services necessary for the proper functioning of the Property that are not part of the services included in ANNEX 4 and shall bear the cost thereof. The Tenant, in particular, shall be responsible for entering into the following individual agreements with the suppliers: |
(a) | water supply; |
(b) | gas supply, if applicable; |
(c) | disposal of waste; |
(d) | security; and |
(e) | telecommunication services. |
Given that the electricity connection and the transformation center are common to the entire logistics park in which the Building is located, the electricity supply agreement will be formalized by the Landlord in an instrumental manner, with divisional electricity meters installed for each user, and their cost and consumption will be passed on to the Tenant, on expiry, as part and in the same way intended for the Operating Expenses. However, it is stated that the contracting of the electricity supply by the Landlord is merely instrumental and does not seek in any way to assume the responsibilities of a power supply company or to give guarantee to the Tenant of said electricity supply.
It is hereby stated for the record that the Landlord is hereby expressly authorized to interrupt the derivation of said electricity supply to the Tenant in the event of non-payment by the Tenant of any cost or consumption of electricity supply, upon notification to the Tenant five (5) Business Days in advance, without the Tenant having any claims or demands to make in this respect.
In the event of an interruption in the electricity supply in the Building, the Landlord hereby assigns to the Tenant the actions against the company that provides electricity to which the Landlord is entitled to claim the damages that may correspond for that reason and the Tenant accepts them and undertakes to hold the Landlord fully harmless from any liability, cost, damage or harm that may arise from the exercise of such actions by the Tenant.
9.6 | Landlord in no way guarantees that the supplies, services or means indicated in this Clause 9 will be provided without interruption and, consequently, will not be liable for the interruption or cessation of such supplies, services or means, unless the interruption or cessation were due to the gross negligence of Landlord. In the event that the Landlord is responsible in accordance with the provisions of this Clause, its liability to the Tenant shall be limited to the same that the provider of the supplies, services or means would have to the Landlord in accordance with the applicable regulations or the corresponding agreement relating to the supply, services or means. Consequently, the Tenant shall not have the right to claim from the Landlord more extensive compensation than those compensations that the Landlord has the right to claim from the corresponding providers of supplies, services or means in accordance with the applicable provisions. The Tenant shall notify the Landlord of any damage without undue delay, otherwise its right to claim compensation from the Landlord for such damage shall be extinguished. |
9.7 | The Landlord shall have the right to charge the Tenant, as part of the Monthly Operating Expenses, a management and administration fee for a total amount equivalent to three percent (3%) of the Monthly Rent. |
9.8 | The Tenant is obliged to pay any and all taxes and/or obligations arising from the exercise of the Permitted Use (and any waste collection fees, vehicle access fees, etc.). In the event that the State, the Autonomous Community, the Province, or the Municipality create new taxes or apply additional levies, or increase the current levies with respect to the Logistics Park, the Building or the Property, the Tenant is obliged to pay the amount of said new tax or additional levy or increase, which will be considered Amounts Assimilated to the Rent. |
10. | PAYMENT |
10.1 | The Tenant is obliged to pay the Rent and the Lease Charges (including applicable taxes) to the Landlord for anticipated monthly payments within the first ten (10) days of the ongoing calendar month. The Landlord shall issue and send the Tenant the corresponding invoice for the Rent and the Lease Charges. |
10.2 | The Rent and Lease Charges will be paid by the Tenant by direct debit to the Tenant’s Account and will be considered paid on the date on which they are effectively deposited in the Landlord’s Account. |
10.3 | If the Start Date does not coincide with the start of a calendar month or if the Lease ends on a date other than the last day of a calendar month, the Tenant shall pay the Rent and the Lease Charges in proportion to the number of days of duration of the Lease in said calendar month. |
10.4 | Any delay in the payment of the Rent or any other amount whose payment corresponds to the Tenant under this Agreement shall accrue a default interest of 0.04% of the amount due for each day of late payment, counted from the day following the day on which the breach occurred, without the need for prior notice or demand for payment by the Landlord and without prejudice to the remaining rights and actions that correspond to the Landlord. |
10.5 | The Tenant is obliged to pay the Rent and the Lease Charges without any kind of compensation, deduction, withholding or reduction on amounts due, even (i) in the event of a breach of the obligations arising from this Agreement by the Landlord or (ii) in the event that the Landlord owes any amount to the Tenant, all of this except in the event that such deduction or withholding is applicable by law, it has been agreed in writing with the Landlord or is derived from the execution of an executive judicial resolution. The Tenant hereby acknowledges receipt of a copy of a certification issued by the Tax Agency confirming that it is exempt from withholding in the payment of the Rent and the Lease Charges, a copy of which is attached as ANNEX 6. In the event that the Landlord ceases to be exempt from having the Tenant make withholdings on the payment of the Rent or the Lease Charges, the Landlord must immediately notify the Tenant so that it can practice, in a timely manner, the withholds applicable under the relevant regulations, in order for the Tenant to make as many payments as necessary to the Tax Authorities and to prove to the Landlord that these payments have been made in a timely manner. |
10.6 | The Parties expressly agree that the obligation to pay the Amounts Assimilated to the Rent by the Tenant is an essential element of this agreement and its non-payment by the Tenant will entitle the Landlord to exercise the same actions that would correspond in the event of non-payment of the Rent, in particular the provision set out in Article 27.2 a) of the Urban Leases Act. |
11. | VALUE ADDED TAX (VAT) |
11.1 | The Lease and the Lease Charges are considered as provision of services for VAT purposes taxed in their entirety and not subject to pro rata, and will be considered to have been occurred on the date of issuance of the corresponding invoice. The Landlord shall pass on to the Tenant the applicable VAT to the Rent and the Lease Charges. |
11.2 | In the event that either Party ceases to have the status of taxable entity for VAT purposes, it must inform the other Party about this circumstance within five (5) Business Days from the date on which such circumstance took place. |
12. | WORKS, MAINTENANCE AND REPAIRS |
12.1 | The Tenant is obliged to keep the Property and its equipment in good condition of use and to carry out Minor Repairs at its own cost. The Landlord may require the Tenant to execute and complete the Minor Repairs within a period of fifteen (15) Business Days from said request. In the event that the Tenant fails to comply with its obligation to execute the Minor Repairs, the Landlord shall have the right to access the Property to execute the Minor Repairs by itself or through a third party, at the cost of the Tenant. |
12.2 | The obligation of the Tenant to execute the Minor Repairs: |
(a) | shall not apply to those defects in respect of which the warranty period granted to the Landlord by the supplier of the relevant goods or services applies; |
(b) | in the event that the Minor Repairs were covered by the Landlord’s Insurance and had been managed as a claim with a favorable response, the Tenant’s obligation shall be limited to satisfying the amount that exceeds the amounts of the insurance paid by the insurance company to the Landlord. |
12.3 | The Landlord shall be entitled to carry out the Major Repairs at its discretion. The Tenant is obliged to allow any construction and/or technical modification that the Landlord deems necessary to improve the Building or the Property or to keep it in compliance with the Technical Specifications. Any other maintenance or improvement work will be carried out by the Landlord only in the manner and conditions agreed with the Tenant. |
12.4 | The Tenant is obliged to inform the Landlord without delay of the need to execute any Major Repairs, especially if there is a threat of damage to the Property or the Building. The Tenant shall not in any case execute the Major Repairs on its own behalf or through third parties without the prior written consent of the Landlord. |
12.5 | During the execution of the Major Repairs or of the constructions and/or technical modifications provided for in Clause 12.3, the Landlord shall make its best efforts so that the use of the Property by the Tenant is harmed as little as possible and, if possible, will inform the Tenant in advance of the need to execute any Major Repair, construction or technical modification that could restrict the use of the Property by the Tenant. The Tenant shall cooperate to the extent possible with the Landlord in the execution of Major Repairs, constructions or technical modifications. |
12.6 | In the event that the Tenant cannot use the Property for the Permitted Use for reasons not attributable to the Tenant, the Tenant must inform the Landlord within two (2) weeks following the date on which the use of the Property has been affected. Otherwise, any right of the Tenant to demand any correction and/or any compensation for damages will be extinguished. |
13. | GUARANTEES |
13.1 | In accordance with the provisions of Article 36.1 of the Urban Leases Act, the Tenant hereby delivers to the Landlord proof of bank transfer of the Legal Deposit to the Landlord's Account, who receives it to its full satisfaction for deposit with the competent public entity and who will serve as a guarantee of the Guaranteed Obligations. A copy of the corresponding transfer receipt is attached as ANNEX 7. The Legal Deposit must be updated on the Start Date and at the beginning of each third year of the Lease to make it equal to two monthly payments of the Rent then in force. The Legal Deposit shall be returned by the Landlord to the Tenant within ten (10) Business Days following the date on which the competent public entity delivers the amount of the Legal Deposit to the Landlord, prior to its application to satisfy the responsibilities pending to be addressed by the Tenant |
13.2 | In addition to the Legal Deposit, the Tenant is obliged to deliver to the Landlord, prior to the deadline of November 25, 2022, an additional guarantee in assurance of the Guaranteed Obligations in the form of (i) bank guarantee issued in favour of the Landlord by a credit institution of recognized solvency and that enables the Landlord to assign or pledge all credit rights in favor of the Landlord’s funders (the “Bank Guarantee”), or (ii) security deposit to be paid by bank transfer to the Landlord’s Account (the “Security Deposit”). Failure to comply with this obligation will entitle the Landlord to require the Tenant to pay a conventional penalty consisting of an amount equal to 0.1% of the amount of the Guaranteed Amount that the Tenant has not guaranteed for each day of non-compliance by the Tenant. |
13.3 | The Bank Guarantee and the Security Deposit must guarantee the Guaranteed Obligations up to a minimum amount of [***] together with the applicable VAT (the “Guaranteed Amount”). |
13.4 | The Tenant is obliged to keep the Bank Guarantee valid, in force and for an amount equal to or greater than the Guaranteed Amount, until three (3) months have elapsed from the end of the Lease Term or, where appropriate, the extension of the Lease Term that would proceed in accordance with Clause 7.3. |
13.5 | The Tenant shall be obliged to supplement or replace the Bank Guarantee at least four (4) months before its expiration with another one issued under identical terms and conditions. In the event that (i) the Tenant fails to comply during the Lease Term with any of its payment obligations under this Agreement or (ii) the Tenant has not proceeded to replace or supplement the Bank Guarantee in the terms established at least thirty (30) days prior to its expiration, the Landlord shall be freely entitled to execute the Bank Guarantee up to the total maximum guaranteed amount and withhold said amounts as Security Deposit for its application to the fulfillment of the Tenant’s obligations in the same manner intended in the Bank Guarantee, with express waiver by the Tenant of any right or power conferred by Article 1775 of the Civil Code. |
13.6 | In the event that the Landlord exercises the Bank Guarantee and the amount that is guaranteed becomes less than the Guaranteed Amount, the Tenant must provide the Landlord with a new Bank Guarantee within five (5) Business Days from the request made by the Landlord for this purpose, so that the total sum guaranteed for all the Bank Guarantees granted by the Tenant is equal to or greater than the Guaranteed Amount. |
13.7 | The Security Deposit will guarantee the proper compliance by the Tenant with the Guaranteed Obligations and the Landlord may apply the Security Deposit or any part thereof to the payment of the debts that the Tenant maintains with the Landlord in the event that the Tenant does not comply with its obligation to satisfy the Guaranteed Obligations in a timely manner. In the event that the Landlord uses the power to apply the Security Deposit to the payment of the defaulted Guaranteed Obligations, the Landlord shall inform the Tenant of the reasons and scope of the application of the Security Deposit and, at the same time, shall require the Tenant to replace the Security Deposit up to at least an amount equal to the Guaranteed Amount. The Tenant must replace the Security Deposit within five (5) Business Days of receipt of the request sent by the Landlord for this purpose. The Tenant shall not be entitled to receive interest on the Security Deposit. |
13.8 | Within three (3) months following the extinction or termination of this Agreement and once all the Tenant’s obligations have been fulfilled in accordance with this Agreement, the Landlord must return to the Tenant the balance of the Security Deposit that has not been applied to the fulfillment of the Guaranteed Obligations. |
13.9 | For the avoidance of doubt, it is expressly stated for the record that the Guaranteed Amount does not operate as a limit of liability of the Tenant for the fulfillment of its obligations under this Agreement. The total or partial execution of a Bank Guarantee does not exclude the exercise of any other action that the Landlord deems appropriate to exercise for the protection of its interests, including those actions aimed at terminating the Lease and evicting the Tenant. |
14. | INSURANCE |
14.1 | The Landlord shall take out and maintain in force a building insurance policy on the Building against natural risks and civil liability insurance against third parties, including insurance against risks arising from the interruption of activity (“Landlord’s Insurance”). |
14.2 | After the execution of this Agreement, the Tenant must subscribe and maintain at all times in force, at its cost, an insurance policy for the Building contents and for the works carried out by the Tenant, as well as civil liability insurance against third parties for the risks derived from the activities carried out by the Tenant in the Property or the Building, including the Permitted Use. The Landlord must give its approval for both the content of the corresponding policies and the respective insurance companies. |
14.3 | At the request of either Party, the other Party must prove that the insurance policies referred to in this Clause 14 have been correctly subscribed and are in force, and that it is up to date in the payment of the corresponding premiums. |
15. | OTHER RIGHTS AND OBLIGATIONS OF THE Tenant |
15.1 | The Tenant shall be obliged to use the Property within the framework and for the purpose stipulated in this Agreement, and subject to the License of Occupation, in such a way that the wear and tear due to use does not exceed the usual wear and tear due to ordinary use under standard conditions. |
15.2 | Additionally and in particular, the Tenant: |
(a) | is obliged to use the Property without undermining the rights of the Landlord or other users of the Building or the Logistics Park, avoid any damage, immediately notify the Landlord of any threat of damage or damage actually caused and, in particular, refrain from introducing animals or dangerous objects, or combustibles or any other harmful, explosive or flammable substance susceptible to causing damage or the destruction or deterioration of the Building; |
(b) | is obliged to comply with the requirements and limitations imposed by the regulations applicable to the Building (including environmental regulations) and the Technical Specifications, conform to the rules of the interior regime of the Building as soon as these rules have been prepared and/or modified by the Landlord and the Landlord has informed the Tenant of their existence, content and/or modifications, and ensure that the rules of the internal regime are observed by its employees, shareholders, customers, visitors, etc. |
(c) | Unless the Tenant obtains the prior written consent of the Landlord, the Tenant must refrain from making modifications to building work, improvements, additional internal structures or technical equipment installations affecting structural elements of the Building and interfering with service networks, sewer, heating and any other equipment, including any equipment that is under warranty and whose interference could impair the ability to exercise such warranty; |
(d) | shall reasonably ventilate the Property according to its characteristics and keep it clean and protected against frost and shall keep the surroundings of the Property and the Parking Spaces clean and well-maintained; |
(e) | must be censored as a VAT taxpayer before the competent tax administrations; |
(f) | undertakes to inform the Landlord of any change of control of the Tenant (as “control” is defined in Article 42 of the Commercial Code); of any transformation of the Tenant (in this case the information must be provided at least 30 days prior to the request for registration of the transformation in the Commercial Registry), of the Tenant's dissolution, of any capital reduction subscribed by the Tenant, of the sale of any branch of the Tenant’s activity and of any threat or risk of the Tenant entering into bankruptcy proceedings (regardless of whether the bankruptcy proceedings are requested or in the case of problems due to over-indebtedness); |
(g) | undertakes to comply with all the obligations derived from the fire prevention regulations applicable to the Property and all the activities that the Tenant carries out in the Property; |
(h) | must comply with the regulations applicable to the use of the Property and with any limitations imposed by this regulation, in particular, the regulations applicable on safety and health protection in the work environment, the hygiene regulations and the technical and construction regulations; |
(i) | undertakes to inform the Landlord immediately of any damage suffered by the Property or of any claim that takes place in the Property. |
15.3 | The Tenant may not assign the Agreement or sublease the Property in whole or in part to any third party without the prior written consent of the Landlord. The Parties hereby expressly waive the application of Article 32 of the Urban Leases Act. By exception to the foregoing, the Landlord hereby authorizes the partial (and not total) sublease of the Property by the Tenant to a company belonging to its group (as “group” is defined in Article 42 of the Commercial Code), provided that: |
(a) | The Tenant is up to date in the payment of the Rent and any other amount due under this Agreement; |
(b) | The Tenant notifies the Landlord in writing of the partial sublease at least thirty (30) days in advance of the sublease, identifying and providing detailed information of the subtenant; |
(c) | The partial sublease does not cause the Landlord harmful effects of a tax nature in accordance with the regulations applicable to the sublease at the time it takes place; and |
(d) | The Tenant assumes full responsibility for the use of the Property by the subtenant and the guarantees granted by the Tenant under this Agreement remain unchanged. |
15.4 | The Tenant is aware of and accepts that it is the Landlord’s will to reach a high standard of sustainability and environmental protection in the operation of the Building and, to this end, the Tenant undertakes to provide the Landlord with the information that the Landlord may require from the Tenant about: |
(a) | Electricity, gas and water consumption in the Property, as well as waste generation -in particular, the information sent by the respective supply and service providers - and, to the extent technically possible, differentiating between heating, air conditioning and lighting consumption. |
(b) | Measures implemented in the Property in order to improve sustainability and environmental protection. |
The Tenant must provide such information and documents always (i) before April 30 of each calendar year in relation to the consumption of the immediately preceding calendar year and (ii) within thirty (30) days following the request for information made by the Landlord on the consumption of the time period specified in the Landlord’s request.
15.5 | The Landlord and the Tenant shall meet at least annually to discuss the use of energy in the Property - based on the information provided by the Tenant - and to study reasonable initiatives that may help reduce energy consumption, carbon emissions, water expenditure and the generation of waste in the Property. |
15.6 | The Parties expressly submit any and all works carried out in the Property to the provisions of this Agreement and, consequently, expressly waive the provisions of Article 30 of the Urban Leases Act and, by referral, to the provisions of Articles 21, 22, 23 and 26 to the applicable extent. |
16. | OTHER RIGHTS AND OBLIGATIONS OF THE Landlord |
16.1 | The Landlord shall provide the Tenant with the occupancy of the Property without disturbances, with the understanding that the Landlord shall not be in any way responsible for the disturbances caused by third parties in the occupancy of the Property. In the event of disturbances by third parties, the Landlord shall make its best efforts to end such disturbance from the moment it is aware of it, taking into account the interests of the Tenant. |
16.2 | The Landlord (or any third party authorized by it) may access the Property at any time during business hours upon notification to the Tenant specifying the reasons for such access, including the following (but not limited to): |
(a) | the preparation and/or execution of urgent structural and technical modifications and/or repairs, which the Tenant is obliged to allow at all times; |
(b) | the maintenance of the technical equipment of the Building; |
(c) | inspection of the Property and the manner in which it is used by the Tenant; |
(d) | show the Property to prospective tenants; or |
(e) | any other relevant reason. |
16.3 | In the event of a threat of damage to health or serious damage to property (in particular, in case of fire), the Landlord and any third party authorized by the Landlord may access the Property without the need for prior notification to the Tenant. In this case, the Landlord must inform the Tenant without delay. |
17. | INFORMATION AND DISTINCTIVE SIGNS |
17.1 | The Tenant may place an identifying sign with its logo (the “Distinctive Sign”) with prior written consent granted by the Landlord, who will not unreasonably deny it, provided that approval has previously been obtained from the competent public administration, if necessary under applicable regulations. The cost of the placement of the Distinctive Sign shall be borne by the Tenant with full exemption of the Landlord. |
17.2 | The Tenant shall be obliged to remove the Distinctive Sign and return its location to its original state on the date on which the Lease Term ends or, if applicable, within five (5) Business Days following the termination of the Lease. In the event that the Tenant fails to comply with the obligations established in this Clause 17, the Landlord will remove the Distinctive Sign at the Tenant’s expense. |
18. | TERMINATION AND EXTINCTION |
18.1 | This agreement may only be terminated and render ineffective by all and/or any of the following causes, with repeal and exclusion of the causes of termination established in the Urban Leases Act: |
(a) | End of the Lease Term and its extensions; |
(b) | Termination of the Agreement for serious breach of obligations in accordance with the provisions of Clauses 18.2 and 18.3 or for the cause referred to in Clause 18.2(c); |
(c) | Notice of termination of the Agreement for breach of the material obligations set out in Clauses 18.4 and 18.5; or |
(d) | Mutual agreement between the Parties. |
Prior to the start of the Lease Term, this Agreement may only be terminated for the reasons referred to in Clauses 18.1(b) and 18.1(c).
18.2 | The Landlord shall have the right to terminate this Agreement by giving two (2) months’ prior notice to the Tenant, with the understanding that the termination shall be effective once the term of one (1) month has elapsed from the first day of the calendar month following the day in which the notice had been sent to the Tenant. The notice provided for in this Clause may be made solely and exclusively for the following reasons: |
(a) | That the Tenant fails to comply with its obligation to allocate the Property for the Permitted Use; |
(b) | That the Tenant or the third parties that use the Property in accordance with this Agreement disrupt peaceful use and/or public order even after having been required to cease in this behavior during the last 12 months. The notice of termination provided for in this Clause shall not be necessary when the aforementioned disturbance exceeds the reasonableness of the circumstances; |
(c) | That it is decreed the obligation to demolish the Building or the obligation to modify it in such a way as to prevent the use of the Property by judicial or administrative resolution of an executive nature; |
(d) | That the Tenant has carried out any action that requires the prior consent of the Landlord without having previously obtained said consent; or |
(e) | That the Tenant permanently and/or repeatedly fails to comply with its obligations even after having been requested in writing by the Landlord on two (2) occasions within the last twelve (12) months to cease its breach, provided that fifteen (15) Business Days have elapsed between both requirements and the Tenant has not ceased its breach within fifteen (15) Business Days following the second requirement of the Landlord. |
18.3 | The Tenant shall have the right to terminate this Agreement by giving one (1) month’s prior notice to the Landlord, with the understanding that the termination shall be effective once the term of one (1) month has elapsed from the first day of the calendar month following the day in which the notice had been sent to the Landlord. The notice provided for in this Clause may be made solely and exclusively for the following reasons: |
(a) | That the Property cannot be occupied for a period of three (3) months for a cause attributable to the Landlord; or |
(b) | That the Landlord permanently and/or repeatedly fails to comply with its obligations even after having been requested in writing by the Tenant on two (2) occasions within the last twelve (12) months to cease the breach, provided that fifteen (15) Business Days have elapsed between both requirements and the Landlord has not ceased its breach within fifteen (15) Business Days following the second request of the Tenant. |
18.4 | The Landlord shall have the right to terminate this Agreement without prior notice and without further requirement than sending a notification to the Tenant for the following reasons, with the understanding that the termination will take effect from the time the notification sent to the Tenant is considered received: |
(a) | That the Tenant fails to comply with the obligation to pay the Rent, the Lease Charges or any other Amount Assimilated to the Rent for more than ten (10) Business Days; |
(b) | That the Tenant fails to comply with the obligation to deliver or replace in a timely manner the Security Deposit or the obligation to deliver in a timely manner the Bank Guarantee and/or the obligation to maintain the amount of the Security Deposit or the sum guaranteed by Bank Guarantee in an amount equal to or greater than the Guaranteed Amount; |
(c) | That the Tenant loses its status as a taxable entity for VAT purposes; or |
18.5 | The Tenant shall have the right to terminate this Agreement without prior notice and without greater requirement than the sending a notification to the Landlord (with the understanding that the termination shall be effective from the time the notification sent to the Landlord is received) in the event that the Delivery Protocol has not been signed within two (2) months following the Delivery Date due to the exclusive fault of the Landlord; or |
18.6 | The Landlord shall have the right to demand from the Tenant a conventional penalty consisting of an amount equal to six (6) months of Rent, plus the total unpaid amount of the Supplementary Part of the Rent, when any of the grounds entitling it to terminate the Agreement occurs in accordance with Clauses 18.2 (except for Clause 18.2(c)) and 18.4, regardless of whether or not the Landlord exercises its power to terminate the Agreement for any of these reasons. |
18.7 | In the event of termination of this agreement, the stipulations of this Agreement relating to the Legal Deposit, Bank Guarantee and Security Deposit; Clauses 17.2 and 19; and any other stipulation that by law is not affected by the termination of the Agreement will remain in force. |
19. | RETURN OF THE PROPERTY AT THE END OF THE LEASE |
19.1 | Upon termination of this agreement pursuant to Clause 18, the Tenant shall be obliged to vacate the Property immediately and to return it to the Landlord free and vacant, in good cleaning conditions, and in the same conditions as it was delivered by the Landlord, with the exception of wear and tear arising from the good ordinary use that the Tenant has made of the Property and the repairs that have been necessary to carry out in accordance with a diligent and careful use of the Property. The Tenant shall return to the Landlord all keys and access mechanisms to the Property (such as access codes, cards, etc.). |
19.2 | Unless otherwise agreed between the Parties or unless the Landlord exercises its legal right of retention, the Tenant must leave the Property free and vacant, removing all personal property and equipment, as well as all modifications and works carried out by the Tenant and repairing all damages that may be caused by their removal. The Landlord may require the Tenant to leave on the Property, for the benefit of the Landlord and without consideration, all the Work Modifications and all the additional structures and improvements executed or incorporated by the Tenant that cannot be removed without damaging the Property. |
19.3 | If the Tenant fails to comply with the obligations set out in Clauses 19.1 and 19.2, so that the Property cannot be considered free and vacant or returned to the Landlord in due time and form, the Landlord shall have the right to require the Tenant to pay a conventional penalty consisting of an amount equal to double (x2) of the daily Rent in force at the time of the termination of the Lease for each day of breach of these obligations. |
19.4 | If the objects and/or elements referred to in Clause 19.2 have not been removed within ten (10) Business Days following the termination of this Lease, the Landlord may remove the outstanding objects and/or elements and deposit them at the Tenant’s expense in any place authorized for this purpose. In this case, the Landlord shall inform the Tenant in writing of the removal and deposit of these objects and/or elements. |
19.5 | If the Tenant has registered its registered office at the Property, it must proceed to transfer the registered office within a period of no more than twenty (20) Business Days from the termination of this Lease. |
19.6 | The provisions of this Clause 19 shall also apply (and to the same extent) to the event that the Tenant has had prior access to the Property and the Agreement is terminated before the Start Date. |
19.7 | The Parties expressly exclude the application to the Agreement of any legal or conventional regulations that determine an extension of this Lease other than that stipulated in this Agreement and, in particular, expressly exclude the tacit renewal established by Article 1,566 of the Civil Code, without the need for a request or notification of any kind by the Landlord. Consequently, the Tenant's stay in the enjoyment of the Property for more than fifteen (15) days after the termination of the Agreement, with the Landlord's acquiescence, shall not in any case constitute tacit re-engagement of this Lease. |
20. | APPLICABLE LAW AND JURISDICTION |
20.1 | Pursuant to Article 4.3 of the Urban Leases Act, this non-residential lease Agreement shall be governed by the will of the Parties expressed in this Agreement and, only in the event that the provisions of this Agreement are insufficient, by the provisions of Title III of the Urban Leases Act and, subsidiarily, by the provisions of the Spanish Civil Code and the civil legislation that is applicable at the location of the Property. |
20.2 | Pursuant to Article 4.4 of the Urban Leases Act, the Parties expressly exclude the application of Articles 21, 22, 23, 25, 26, 31, 32, 33, 34 and 35 of the Urban Leases Act, and the Tenant, herewith, expressly waives any of the rights provided for by these articles to the tenants, in particular, expressly waives any type of pre-emptive acquisition right to which it may be entitled upon the total or partial transfer of the Property, the Building or the Logistics Park. |
20.3 | The Parties submit any and all discrepancies that may arise between them in relation to the interpretation, application or execution of this Agreement to the courts and tribunals of the judicial party corresponding to the locality in which the Property is located, expressly waiving any other jurisdiction that may correspond to them. |
21. | FINAL PROVISIONS |
21.1 | This Agreement, with its annexes, constitutes the entire agreement between the Parties, and may only be modified or novated in writing with the signature of both Parties, except for the change of address for notices purposes in accordance with Clause 21.2. |
21.2 | All notices to be given pursuant to this Agreement shall be in writing only and shall be delivered in person, by an official mailing service which records its contents and receipt or by a recognized mailing service which records its contents and receipt, or by burofax, to the addresses set out below or to such other address as either Party may notify to the other pursuant to this Clause. In addition, notifications will be sent at the same time via e-mail. Notifications will be sent to the following addresses: |
(a) | To Landlord |
[***]
(b) | To Tenant |
[***]
All notifications made hereunder, as well as their annexes, if any, must be made in English or accompanied by an English translation.
Each Party is obliged to notify the other, exclusively in writing and by the aforementioned means, of any change of address for notices. Such notification shall take effect once at least ten (10) Business Days have elapsed since the notification is considered received by the receiving Party.
Any notification, communication or statement for the purposes of this Agreement that is sent to the contacts stated above or to the new contacts notified in accordance with the previous paragraph of this Clause 21.2 shall be deemed to have been made on the date on which it must be considered received such notification, communication or statement by any of the aforementioned contacts.
21.3 | Except as otherwise provided in this Agreement, no conventional penalty applicable under this Agreement shall be a substitute for the recovery of damages or affect the right corresponding to the relevant Party to demand compensation for damages whose amount exceeds the amount of the conventional penalty. Unless an imperative regulation states otherwise: (i) a global and high liability limit is established for the Landlord of [***] for any liability that may arise for the Landlord under this Agreement or in relation to this Agreement; (ii) the Landlord shall not incur liability if it is not due to willful misconduct or gross negligence in its actions; and (iii) the Parties shall not be entitled to compensation for lost profits or consequential damages. |
21.4 | The information that each Party has received from the other Party in connection with this Agreement is considered confidential and the Parties undertake to maintain the confidentiality of such information. |
21.5 | The Tenant may not assign this Agreement in whole or in part to a third party, or any of its rights under the Agreement, without the prior written consent of the Landlord. The Tenant hereby expressly waives the right granted to it in this regard by Article 32 of the Urban Leases Act. |
21.6 | If any provision of this Agreement is declared, in whole or in part, void or ineffective, the remaining provisions shall survive and shall not be affected. Void or ineffective stipulations shall be replaced by new ones that, to the greatest extent possible, adequately reflect the intent or purposes of the Parties expressed in this Agreement. |
21.7 | This Agreement is executed in duplicate and each Party receives one of them. |
CERTAIN IDENTIFIED SCHEDULES HAVE BEEN EXCLUDED FROM THE EXHIBIT PURSUANT TO
REGULATION S-K, ITEM 601(A)(5) BECAUSE THEY DO NOT CONTAIN INFORMATION MATERIAL
TO AN INVESTMENT OR VOTING DECISION AND THAT INFORMATION IS NOT OTHERWISE
DISCLOSED IN THE EXHIBIT OR THE DISCLOSURE DOCUMENT
ANNEX 1 LAND REGISTRY EXCERPT
[OMITTED] |
CERTAIN IDENTIFIED SCHEDULES HAVE BEEN EXCLUDED FROM THE EXHIBIT PURSUANT TO
REGULATION S-K, ITEM 601(A)(5) BECAUSE THEY DO NOT CONTAIN INFORMATION MATERIAL
TO AN INVESTMENT OR VOTING DECISION AND THAT INFORMATION IS NOT OTHERWISE
DISCLOSED IN THE EXHIBIT OR THE DISCLOSURE DOCUMENT
ANNEX 2 TECHNICAL SPECIFICATIONS
[OMITTED] |
CERTAIN IDENTIFIED SCHEDULES HAVE BEEN EXCLUDED FROM THE EXHIBIT PURSUANT TO
REGULATION S-K, ITEM 601(A)(5) BECAUSE THEY DO NOT CONTAIN INFORMATION MATERIAL
TO AN INVESTMENT OR VOTING DECISION AND THAT INFORMATION IS NOT OTHERWISE
DISCLOSED IN THE EXHIBIT OR THE DISCLOSURE DOCUMENT
ANNEX 3 ILLUSTRATIVE PLANS OF THE PROPERTY
[OMITTED] |
CERTAIN IDENTIFIED SCHEDULES HAVE BEEN EXCLUDED FROM THE EXHIBIT PURSUANT TO
REGULATION S-K, ITEM 601(A)(5) BECAUSE THEY DO NOT CONTAIN INFORMATION MATERIAL
TO AN INVESTMENT OR VOTING DECISION AND THAT INFORMATION IS NOT OTHERWISE
DISCLOSED IN THE EXHIBIT OR THE DISCLOSURE DOCUMENT
ANNEX 4 TABLE OF LEASE CHARGES
[OMITTED] |
CERTAIN IDENTIFIED SCHEDULES HAVE BEEN EXCLUDED FROM THE EXHIBIT PURSUANT TO
REGULATION S-K, ITEM 601(A)(5) BECAUSE THEY DO NOT CONTAIN INFORMATION MATERIAL
TO AN INVESTMENT OR VOTING DECISION AND THAT INFORMATION IS NOT OTHERWISE
DISCLOSED IN THE EXHIBIT OR THE DISCLOSURE DOCUMENT
ANNEX 5 CHANGE ORDER PRO-FORMA
[OMITTED] |
CERTAIN IDENTIFIED SCHEDULES HAVE BEEN EXCLUDED FROM THE EXHIBIT PURSUANT TO
REGULATION S-K, ITEM 601(A)(5) BECAUSE THEY DO NOT CONTAIN INFORMATION MATERIAL
TO AN INVESTMENT OR VOTING DECISION AND THAT INFORMATION IS NOT OTHERWISE
DISCLOSED IN THE EXHIBIT OR THE DISCLOSURE DOCUMENT
ANNEX 6 TAX CERTIFICATES AND SEPA MANDATE
[OMITTED] |
CERTAIN IDENTIFIED SCHEDULES HAVE BEEN EXCLUDED FROM THE EXHIBIT PURSUANT TO
REGULATION S-K, ITEM 601(A)(5) BECAUSE THEY DO NOT CONTAIN INFORMATION MATERIAL
TO AN INVESTMENT OR VOTING DECISION AND THAT INFORMATION IS NOT OTHERWISE
DISCLOSED IN THE EXHIBIT OR THE DISCLOSURE DOCUMENT
ANNEX 7
[OMITTED]
|
CERTAIN IDENTIFIED SCHEDULES HAVE BEEN EXCLUDED FROM THE EXHIBIT PURSUANT TO
REGULATION S-K, ITEM 601(A)(5) BECAUSE THEY DO NOT CONTAIN INFORMATION MATERIAL
TO AN INVESTMENT OR VOTING DECISION AND THAT INFORMATION IS NOT OTHERWISE
DISCLOSED IN THE EXHIBIT OR THE DISCLOSURE DOCUMENT
ANNEX 8 DETAILS OF THE TENANT FOR THE LEASE STUDY
[OMITTED]
|
SIGNATURES PAGE OF THE AGREEMENT
In __________ on 07-11-2022 |
In __________ on 04-11-2022 |
VGP PARK DOS HERMANAS, S.L.U. | H2B2 ELECTROLYSIS TECHNOLOGIES, S.L. |
/s/ Jan Van Geet
|
/s/ Florencio-Salvador Ferrera Saldaña |
|||
Jan Van Geet
Sole Director
|
Florencio-Salvador Ferrera Saldaña
Sole Director
|
H2B2 Electrolysis Technologies, S.L.
Calle Fortuny 19, Entreplanta
izquierda
28010 Madrid
Spain
670496428 | 670485232
ESB95479051
|
PURCHASE ORDER
No. Order: 2023 - 230954 - CHS
Date Order: 02/11/2023
|
Person Responsible:
|
No employee sales-dep
|
Code Supplier:
|
|
Delivery Address:
|
Carretera del Copero, número 6,
nave B, módulo 2, 41700,
Dos Hermanas, Seville
|
Ref Supplier:
Corporate Name:
|
CHS Arquitectos S.L.
|
TAX IDENTIFICATION NUMBER (N.I.F.)
|
[***]
|
Address:
|
Avenida de la Constitución 34 – 2º.
41001 SEVILLE
|
Payment method:
|
TRANSFER
|
Delivery Date: 31/12/2024
|
ES
|
Payment conditions:
|
60 days
|
Cod Article
|
Cod Supplier
|
Description
|
Quantity
|
Price U.
|
Disc(%)
|
Tax.(%)
|
Total
|
|
Milestone 1 || 22 | 4846 | 230954 |
|
[***]
|
[***]
|
[***]
|
|||
ART717 |
30 October 2023 – Provision of Funds P.B.
|
1,00
|
21,00%
|
||||
|
Milestone 2 || 22 | 4846 | 230954 |
|
[***]
|
[***]
|
[***]
|
|||
ART717 |
31 December 2023 - Basic Project
|
1,00
|
21,00%
|
||||
|
Milestone 3 || 22 | 4846 | 230954 |
|
[***]
|
[***]
|
[***]
|
|||
ART717 |
31 December 2023 - Provision of Funds P.E.
|
1,00
|
21,00%
|
||||
|
Milestone 4 || 22 | 4846 | 230954 |
|
[***]
|
[***]
|
[***]
|
|||
ART717 |
28 February 2024 - Execution Project
|
1,00
|
21,00%
|
||||
|
Milestone 5 || 22 | 4846 | 230954 |
|
[***]
|
[***]
|
[***]
|
|||
ART717 |
1 April 2024 - Provision of Funds D.O.
|
1,00
|
21,00%
|
||||
|
Milestone 6 || 22 | 4846 | 230954 |
|
[***]
|
[***]
|
[***]
|
|||
ART717 |
31 December 2024 - Works Management
|
1,00
|
21,00%
|
Signed by SUAREZ AVILA JUAN -
|
|
Signed by HERRERO ELORDI ANTONIO JULIO
|
Total units: 6,00
|
||
D-TCN-001
|
Base Taxable:
|
[***]
|
Discount (0%): |
||
Professional fees for H2B2 IPCEI Factory.
|
Tax Total
|
[***]
|
Total:
|
[***]
|
Name of Subsidiary
|
Jurisdiction of Organization
|
|
H2B2 Electrolysis Technologies, S.L.U.
|
Spain
|
|
H2B2 Corp, S.L.U.
|
Spain
|
|
H2B2 O&M, S.L.U.
|
Spain
|
|
Green H2, LLC
|
USA
|
|
SoHyCal LLC
|
USA
|
|
H2B2 QOF, LLC
|
USA
|
|
H2B2 USA, LLC
|
USA
|
|
H2B2 Electrolysis Technologies UK, Ltd
|
England and Wales
|
|
Flitecho, S.L.
|
Uruguay
|
|
GreenH Electrolysis Private Ltd
|
India
|
|
H2V2 Mexico, S.A de C.V.
|
México
|
Dated:
|
8 December, 2023
|
||
By:
|
/s/ Anselmo Andrade Fernández de Mesa
|
||
Name:
|
Anselmo Andrade Fernández de Mesa
|
Dated:
|
8 December, 2023
|
||
By:
|
/s/ Antonio Vázquez Romero
|
||
Name:
|
Antonio Vázquez Romero
|
Dated:
|
8 December, 2023
|
||
By:
|
/s/ Blanca de Porres Guardiola
|
||
Name:
|
Blanca de Porres Guardiola
|
Dated:
|
8 December, 2023
|
||
By:
|
/s/ Felipe Benjumea de Porres
|
||
Name:
|
Felipe Benjumea de Porres
|
Dated:
|
8 December, 2023
|
||
By:
|
/s/ Guillermo Delclaux Lezama Leguizamón
|
||
Name:
|
Guillermo Delclaux Lezama Leguizamón
|
Dated:
|
8 December, 2023
|
||
By:
|
/s/ Manuel Delclaux Lezama Leguizamón
|
||
Name:
|
Manuel Delclaux Lezama Leguizamón
|
Dated:
|
14 December, 2023
|
||
By:
|
/s/ Iván E. Mercado
|
||
Name:
|
Iván E. Mercado
|
Dated:
|
18 December, 2023
|
||
By:
|
/s/Robert S. Mancini
|
||
Name:
|
Robert S. Mancini
|
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