Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
On March 29, 2022, Flame Acquisition Corp. (the "Company") issued an unsecured
promissory note (the "Note") in the principal amount of $335,000 to Flame
Acquisition Sponsor LLC (the "Sponsor"). The Note does not bear interest and is
repayable in full upon consummation of the Company's initial business
combination (a "Business Combination"). If the Company does not complete a
Business Combination, the Note shall not be repaid and all amounts owed under it
will be forgiven except to the extent that the Company has funds available to it
outside of its trust account established in connection with the Company's
initial public offering (the "IPO"). Upon the consummation of a Business
Combination, the Sponsor shall have the option, but not the obligation, to
convert the principal balance of the Note, in whole or in part, into that number
of warrants to purchase one share of Class A common stock, $0.0001 par value per
share, of the Company (the "Working Capital Warrants") equal to the principal
amount of the Note so converted divided by $1.00. The terms of the Working
Capital Warrants will be identical to the terms of the warrants issued by the
Company to the Sponsor in a private placement that took place simultaneously
with the Company's IPO. The Note is subject to customary events of default, the
occurrence of which automatically trigger the unpaid principal balance of the
Note and all other sums payable with regard to the Note becoming immediately due
and payable.
The Note was issued pursuant to the exemption from registration contained in
Section 4(a)(2) of the Securities Act of 1933, as amended.
The Note is attached as Exhibit 10.1 to this Current Report on Form 8-K and is
incorporated herein by reference. The disclosure set forth in this Item 2.03 is
intended to be a summary only and is qualified in its entirety by reference to
the Note.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit
No. Description of Exhibits
10.1 Promissory Note, dated March 29, 2022, issued by Flame Acquisition
Corp. to Flame Acquisition Sponsor LLC.
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