Item 1.01 Entry into a Material Definitive Agreement.
Business Combination Agreement
On November 16, 2022, Sagaliam Acquisition Corp., a Delaware corporation
("Sagaliam"), entered into a Business Combination Agreement (as it may be
amended, supplemented or otherwise modified from time to time, the "Business
Combination Agreement") by and among Sagaliam, Allenby Montefiore Limited, a
private company limited by shares organized and existing under the Laws of the
Republic of Cyprus ("PubCo"), AEC Merger Sub Corp., a Delaware corporation and
wholly-owned subsidiary of PubCo ("PubCo Merger Sub"), Supraeon Investments
Limited, a private company limited by shares organized and existing under the
Laws of the Republic of Cyprus (the "Company", and together with AEC (as defined
below), PubCo and PubCo Merger Sub, the "Company Entities"), and GLD Partners,
LP, a Delaware limited partnership ("Seller"). Sagaliam, Seller, PubCo, PubCo
Merger Sub, the Company, and Seller are each referred to individually as a
"Party" and, collectively, the "Parties". Arabian Entertainment Company Limited,
a limited liability company organized under the Laws of the Kingdom of Saudi
Arabia ("AEC") is a majority-owned subsidiary of the Company, with Seller as the
only other owner of shares of AEC.
Capitalized terms used in this Current Report on Form 8-K but not otherwise
defined herein have the meanings given to them in the Business Combination
Agreement.
Pursuant to the Business Combination Agreement, subject to the terms and
conditions set forth therein among other things, the remaining shares of AEC
will be contributed to the Company, the Company's shares will be contributed to
PubCo, Sagaliam will contribute every eight (8) outstanding Sagaliam Rights to
PubCo (the "Contribution") and PubCo Merger Sub will merge with and into
Sagaliam, with Sagaliam continuing as the surviving corporation (the "Surviving
Corporation") and becoming thereby a wholly-owned subsidiary of PubCo (the
"Merger").
As a result of the Contribution, Sagaliam will contribute every eight (8)
outstanding Sagaliam Rights to PubCo in exchange for one PubCo Ordinary Share,
and following the Contribution, as a result of the Merger, among other things,
each share of Sagaliam Capital Stock that is issued and outstanding immediately
prior to the Merger Effective Time, shall automatically be converted into the
right to receive one PubCo Ordinary Share (the "Merger Consideration Shares").
As of the Merger Effective Time, (a) each holder of Sagaliam Capital Stock and
each holder of Sagaliam Rights shall cease to have any other rights in and to
Sagaliam or the Surviving Corporation; (b) all of the shares of common stock of
PubCo Merger Sub issued and outstanding immediately prior to the Merger
Effective Time shall be converted into an equal number of shares of common stock
of the Surviving Corporation, with the same rights, powers and privileges as the
shares so converted and shall constitute the only outstanding shares of capital
stock of the Surviving Corporation; and (c) all of the shares of PubCo issued
and outstanding immediately prior to the Merger Effective Time shall be
cancelled and extinguished without any conversion thereof or payment therefor.
Earnout
Following the Closing, and as additional contingent consideration for the Merger
and the other Transactions, within ten (10) Business Days after the occurrence,
if any, of a Triggering Event (as defined below), PubCo shall issue or cause to
be issued to Seller or Seller's designee (the "Earnout Participants") the
following additional PubCo Ordinary Shares (which shall be equitably adjusted
for share subdivisions, share consolidations, share dividends, reorganizations,
recapitalizations, reclassifications, combination, exchange of shares or other
like change or transaction): (i) upon the occurrence of the First Share Release
Date, a release of 20,000,000 PubCo Ordinary Shares; (ii) upon the occurrence of
the Second Share Release Date, a release of 10,000,000 PubCo Ordinary Shares;
and (iii) upon the occurrence of the Third Share Release Date, a release of
5,000,000 PubCo Ordinary Shares.
For purposes hereof, "Triggering Event" means the occurrence of any of the
following events:
? "First Share Release Date" means a $15.00 Share Price Level is reached
following the one year anniversary of the Closing Date.
? "Second Share Release Date" means a $20.00 Share Price Level is reached
following the one year anniversary of the Closing Date.
? "Third Share Release Date" means a $25.00 Share Price Level is reached
following the one year anniversary of the Closing Date.
2
The applicable "Share Price Level" will be considered achieved only when the
last reported sale price of PubCo Ordinary Shares is greater than or equal to
the applicable threshold for any twenty (20) trading days within any 30-trading
day period commencing on the one (1) year anniversary of the Closing Date and
ending on the six (6) year anniversary of the Closing Date (the "Earnout Period
End Date"). If a Triggering Event has not occurred by the Earnout Period End
Date, any PubCo Earnout Shares not previously issued shall be cancelled and
Seller shall have no right to receive any benefit therefrom.
In connection with the Closing, PubCo and Seller will enter into an escrow
agreement, substantially in the form attached as Exhibit B to the Business
Combination Agreement, with Continental Stock Transfer & Trust Company, as the
Escrow Agent, pursuant to which PubCo will deposit the maximum number of PubCo
Earnout Shares issuable with the Escrow Agent.
Representations, Warranties and Covenants
The Business Combination Agreement contains customary representations and
warranties of the parties, which will not survive the Closing. Many of the
representations and warranties are qualified by materiality or Company Material
Adverse Effect (with respect to the Company) or Sagaliam Material Adverse Effect
(with respect to Sagaliam). Company Material Adverse Effect as defined in the
Business Combination Agreement means any Effect that, individually or in the
aggregate with all other Effects, (a) is or would reasonably be expected to have
a material adverse effect on the business, condition (financial or otherwise),
assets, liabilities or operations of the Company or its subsidiaries (including
PubCo and PubCo Merger Sub) or (b) would prevent, materially delay or materially
impede the performance by the Company of its obligations under this Agreement or
the consummation of the Share Exchange, the Contribution, the Merger or any of
the other Transactions; provided, however, that no Effect to the extent arising
out of, relating to or resulting from certain events or conditions (as further
detailed in the Business Combination Agreement) shall be deemed, either alone or
in combination, to constitute, or be taken into account in the determination of
whether there has been or would be reasonably expected to be, a Company Material
Adverse Effect. Sagaliam Material Adverse Effect as defined in the Business
Combination Agreement means any Effect that, individually or in the aggregate
with all other Effects, (a) is or would reasonably be expected to have a
material adverse effect on the business, condition (financial or otherwise),
assets, liabilities or operations of Sagaliam; or (b) would prevent, materially
delay or materially impede the performance by Sagaliam or of its obligations
under this Agreement or the consummation of the Share Exchange, the
Contribution, the Merger or any of the other Transactions; provided, however,
that no Effect to the extent arising out of, relating to or resulting from
certain events or conditions (as further detailed in the Business Combination
Agreement) shall be deemed, either alone or in combination, to constitute, or be
taken into account in the determination of whether there has been or would be
reasonably expected to be, a Sagaliam Material Adverse Effect. Certain of the
representations are subject to specified exceptions and qualifications contained
in the Business Combination Agreement, information disclosed in Sagaliam's
filings with the Securities and Exchange Commission, or in information provided
pursuant to certain disclosure schedules to the Business Combination Agreement.
The Business Combination Agreement also contains pre-Closing covenants of the
parties, including obligations of the parties to operate their respective
businesses in the ordinary course consistent with past practice, and to refrain
from taking certain specified actions without the prior written consent of the
other applicable parties, in each case, subject to certain exceptions and
qualifications. Additionally, the parties have agreed not to solicit, negotiate
or enter into competing transactions, as further provided in the Business
Combination Agreement. The pre-Closing covenants do not survive the Closing
(other covenants to be performed after the Closing do survive the Closing).
Sagaliam and the Company agreed, as promptly as practicable after the execution
of the Business Combination Agreement, to prepare, and Sagaliam and PubCo have
agreed to file with the SEC, a registration statement on Form F-4 (as amended,
the "F-4 Registration Statement") in connection with the registration under the
Securities Act of 1933, as amended (the "Securities Act") of the PubCo Ordinary
Shares pursuant to the Business Combination Agreement, and containing a proxy
statement/prospectus for the purpose of Sagaliam soliciting proxies from the
stockholders of Sagaliam to approve the Business Combination Agreement, the
Transactions and related matters (the "Sagaliam Stockholder Approval") at a
special meeting of Sagaliam stockholders (the "Stockholder Meeting") and
. . .
Item 7.01. Regulation FD Disclosure
On November 16, 2022, Sagaliam and the Company issued a joint press release
announcing the execution of the Business Combination Agreement described in Item
1.01 above. The press release is attached hereto as Exhibit 99.1 and
incorporated into this Item 7.01 by reference. Notwithstanding the foregoing,
information contained on the websites of Sagaliam, the Company or any of their
affiliates referenced in Exhibit 99.1 or linked therein or otherwise connected
thereto does not constitute part of nor is it incorporated by reference into
this Current Report on Form 8-K.
Furnished as Exhibit 99.2 hereto and incorporated into this Item 7.01 by
reference is the investor presentation that Sagaliam and the Company have
prepared for use in connection with the announcement of the Business
Combination.
The information in this Item 7.01, including Exhibit 99.1, is furnished and
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to
liabilities under that section, and shall not be deemed to be incorporated by
reference into the filings of SPAC under the Securities Act or the Exchange Act,
regardless of any general incorporation language in such filings. This Current
Report on Form 8-K will not be deemed an admission as to the materiality of any
of the information in this Item 7.01, including Exhibit 99.1.
6
Important Information and Where to Find It
This Current Report on Form 8-K relates to a proposed transaction between
Sagaliam, PubCo and the Company. This Current Report on Form 8-K does not
constitute an offer to sell or exchange, or the solicitation of an offer to buy
or exchange, any securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, sale or exchange would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction. In connection with the transaction described herein, Sagaliam and
PubCo intend to file relevant materials with the SEC, including a registration
statement on Form F-4, which will include a proxy statement/prospectus. The
proxy statement/prospectus will be sent to all Sagaliam stockholders. Sagaliam
and PubCo also will file other documents regarding the proposed transaction with
the SEC. Before making any voting or investment decision, investors and security
holders of Sagaliam are urged to read the F-4 Registration Statement, the proxy
statement/prospectus and all other relevant documents filed or that will be
filed with the SEC in connection with the proposed transaction as they become
available because they will contain important information about the proposed
transaction.
Investors and security holders will be able to obtain free copies of the proxy
statement/prospectus and all other relevant documents filed or that will be
filed with the SEC by Sagaliam through the website maintained by the SEC at
www.sec.gov or by directing a request to Sagaliam to 1800 Avenue of the Stars,
Suite 1475, Los Angeles, CA 90067 or (213) 616-0011.
Participants in the Solicitation
Sagaliam, PubCo and the Company, and their respective directors and executive
officers, may be deemed to be participants in the solicitation of proxies from
Sagaliam's stockholders in connection with the proposed transaction. Information
about Sagaliam's directors and executive officers and their ownership of
Sagaliam's securities is set forth in Sagaliam's filings with the SEC.
Additional information regarding the interests of those persons and other
persons who may be deemed participants in the proposed transaction may be
obtained by reading the proxy statement/prospectus regarding the proposed
transaction when it becomes available. You may obtain free copies of these
documents as described in the preceding paragraph.
Non-Solicitation
This Current Report on Form 8-K is not a proxy statement or solicitation of a
proxy, consent or authorization with respect to any securities or in respect of
the potential transaction and shall not constitute an offer to sell or a
solicitation of an offer to buy the securities of Sagaliam, PubCo or the
Company, nor shall there be any sale of any such securities in any state or
jurisdiction in which such offer, solicitation, or sale would be unlawful prior
to registration or qualification under the securities laws of such state or
jurisdiction. No offer of securities shall be made except by means of a
prospectus meeting the requirements of the Securities Act.
7
Forward-Looking Statements
This Current Report on Form 8-K contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, including statements
regarding the proposed transaction between Sagaliam, PubCo and the Company. Such
forward-looking statements include, but are not limited to, statements regarding
the closing of the transaction and SPAC's, the Company's or their respective
management teams' expectations, hopes, beliefs, intentions or strategies
regarding the future. The words "anticipate", "believe", "continue", "could",
"estimate", "expect", "intends", "may", "might", "plan", "possible",
"potential", "predict", "project", "should", "would" and similar expressions may
identify forward-looking statements, but the absence of these words does not
mean that a statement is not forward-looking. These forward-looking statements
are based on Sagaliam's and the Company's current expectations and beliefs
concerning future developments and their potential effects on Sagaliam, the
Company, PubCo or any successor entity of the transaction and include statements
concerning (i)expectations regarding cash on the balance sheet following closing
and whether such cash will be sufficient to meet the Company's business
objectives and (ii) the expected timing of closing the transaction.
Forward-looking statements are predictions, projections and other statements
about future events that are based on current expectations and assumptions and,
as a result, are subject to risks and uncertainties. These statements are based
on various assumptions, whether or not identified in this Current Report on Form
8-K. These forward-looking statements are provided for illustrative purposes
only and are not intended to serve as and must not be relied on by an investor
as, a guarantee, an assurance, a prediction or a definitive statement of fact or
probability. Actual events and circumstances are difficult or impossible to
predict and will differ from assumptions. Many actual events and circumstances
are beyond the control of Sagaliam, PubCo and the Company. Many factors could
cause actual future events to differ materially from the forward-looking
statements in this Current Report on Form 8-K, including but not limited to: (i)
the risk that the transaction may not be completed in a timely manner or at all,
which may adversely affect the price of Sagaliam's securities, (ii) the failure
to satisfy the conditions to the consummation of the transaction, including the
adoption of the Business Combination Agreement by Sagaliam's stockholders, the
satisfaction of the minimum trust account amount following any redemptions by
Sagaliam's public stockholders and the receipt of certain governmental and
regulatory approvals, (iii) the occurrence of any event, change or other
circumstance that could give rise to the termination of the Business Combination
Agreement, (iv) the inability to complete the PIPE Investment, (v) the effect of
the announcement or pendency of the transaction on the Company's business
relationships, operating results and business generally, (vi) risks that the
transaction disrupts current plans and operations of the Company, (vii) changes
in the competitive and highly regulated industries in which the Company
operates, variations in operating performance across competitors and changes in
laws and regulations affecting the Company's business, (viii) the ability to
implement business plans, forecasts and other expectations after the completion
of the transaction, and identify and realize additional opportunities, (ix) the
outcome of any legal proceedings that may be instituted against the Company,
PubCo or Sagaliam related to the Business Combination Agreement or the
transaction, (x) volatility in the price of Sagaliam's or any successor entity's
securities due to a variety of factors, including changes in the competitive
industries in which the Company operates or plans to operate, variations in
performance across competitors, changes in laws and regulations affecting the
Company's business and changes in the combined capital structure, (xi) costs
related to the transaction and the failure to realize anticipated benefits of
the transaction or to realize estimated pro forma results and underlying
assumptions, including with respect to estimated stockholder redemptions, (xii)
the risk that the Company and its current and future collaborators are unable to
successfully develop and commercialize the Company's products or services, or
experience significant delays in doing so, (xiii) the risk that the Company may
need to raise additional capital to execute its business plan, which many not be
available on acceptable terms or at all, (xiv) the risk that the
post-combination company experiences difficulties in managing its growth and
expanding operations, (xv) the risk that third-party suppliers and manufacturers
are not able to fully and timely meet their obligations, (xvi) the risk of
product liability or regulatory lawsuits or proceedings relating to the
. . .
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits:
No. Description of Exhibit
2.1* Business Combination Agreement, dated as of November 16, 2022, by and
among Sagaliam Acquisition Corp., Allenby Montefiore Limited, AEC Merger
Sub Corp., Supraeon Investments Limited, and GLD Partners, LP.
10.1 Seller Support Agreement
10.2 Sponsor Support Agreement
10.3 Amended and Restated Registration Rights Agreement
99.1 Joint Press Release, dated November 16, 2022.
99.2 Investor Presentation
104 Cover Page Interactive Data File (formatted as inline XBRL).
* Certain exhibits and schedules to this Exhibit have been omitted in accordance
with Regulation S-K Item 601(b)(2). Sagaliam agrees to furnish supplementally a
copy of all omitted exhibits and schedules to the Securities and Exchange
Commission upon its request.
8
© Edgar Online, source Glimpses
SAGALIAM ACQUISITION CORP. 
