Item 1.01. Entry into a Material Definitive Agreement
Business Combination Agreement
On April 28, 2022, Ignyte Acquisition Corp., a Delaware corporation (Ignyte), Ignyte Korea Co., Ltd., a corporation organized under the laws of the Republic of Korea (Korean Sub), and Peak Bio Co., Ltd., a corporation organized under the laws of the Republic of Korea (the Target), entered into a Business Combination Agreement (the Business Combination Agreement), pursuant to which the (i) stockholders of the Target will transfer their respective shares of common stock of Target, par value KRW 500 per share (the Target Common Stock), to Korean Sub in exchange for shares of common stock of Ignyte (the Ignyte Common Stock) held by Korean Sub, and (ii) in the course of such share swap, Korean Sub will distribute the shares of Target Common Stock to Ignyte in consideration of Ignyte Common Stock (which will in-turn be delivered to the stockholders of the Target as described in (i) above ((i) and (ii), collectively, the Share Swap, together with the other transactions related thereto, the Proposed Transactions). Upon consummation of the Share Swap, the Target will become a direct wholly-owned subsidiary of Ignyte.
At the Effective Time (as defined the Business Combination Agreement), by virtue of the Share Swap and without any action on the part of Ignyte, Korean Sub, the Company or the holders of any of the following securities or rights:
(i) the right to each share of Target Common Stock issued and outstanding immediately prior to the Effective Time (including shares issued upon the exercise or conversion of any options held by stockholders of the Target, the Target Options) held by the stockholders of the Target immediately prior to the closing of the Proposed Transactions (the Closing) shall be automatically cancelled and converted into the right to receive a number of shares of Ignyte Common Stock equal to the Exchange Ratio (as defined in the Business Combination Agreement);
(ii) any fractional share of Ignyte Common Stock that would otherwise be issuable to such person following such conversion shall be rounded up to a whole share of Ignyte Common Stock; and
(iii) each Target Option that is outstanding immediately prior to the Effective Time, whether vested or unvested, shall, automatically and without any required action on the part of the holder thereof, in cancellation and settlement thereof, cease to represent an option to purchase Target Common Stock and shall be converted into an option to purchase a number of shares of Ignyte Common Stock (such option, an Exchanged Target Option) equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Target Common Stock subject to such Target Option immediately prior to the Effective Time and (ii) the Exchange Ratio (as defined in the Business Combination Agreement), at an exercise price per share (rounded up to the nearest whole cent) equal to (A) the exercise price per share of Target Common Stock of such Target Option immediately prior to the Effective Time divided by (B) the Exchange Ratio; provided, however, that the exercise price and the number of shares of Ignyte Common Stock purchasable pursuant to the Exchanged Target Options shall be determined in a manner consistent with the requirements of Section 409A of the Internal Revenue Code of 1986 (as amended, the Code); provided, further, that in the case of any Exchanged Target Option to which Section 422 of the Code applies, the exercise price and the number of shares of Ignyte Common Stock purchasable pursuant to such option shall be determined in accordance with the foregoing, subject to such adjustments as are necessary in order to satisfy the requirements of Section 424(a) of the Code. Except as specifically provided above, following the Effective Time, each Exchanged Target Option shall continue to be governed by the same terms and conditions (including vesting and exercisability terms) as were applicable to the corresponding former Target Option immediately prior to the Effective Time.
Proxy
As promptly as practicable after the date of the Business Combination Agreement, Ignyte will prepare and file with the Securities and Exchange Commission (the SEC) a proxy statement (as amended or supplemented from time to time, the Proxy) to be sent to the stockholders of Ignyte (the Ignyte Stockholders) relating to the special meeting of the Ignyte Stockholders (the Ignyte Stockholders Meeting) to be held to consider (i) approval and adoption of the transactions contemplated by the Business Combination Agreement, including the Business Combination, (ii) (a) approval of the second amended and restated certificate of incorporation of Ignyte and (b) approval of the amended and restated Ignyte bylaws, (iii) approval of the issuance of Ignyte Common Stock as contemplated by the Business Combination Agreement and the Subscription Agreements (as defined below), (iv) approval of the adoption of a new long term incentive plan in form and substance reasonably acceptable to Ignyte and the Target, (v) approval of the nomination of seven (7) directors to the board of directors of Ignyte (the Ignyte Board) and (vi) adjournment of the special meeting, if necessary.
Stock Exchange Listing
Ignyte will use its reasonable best efforts to cause the shares of Ignyte Common Stock to be issued in connection with the Proposed Transactions to be approved for listing on the Nasdaq Capital Market at the Closing. Until the Closing, Ignyte shall use its reasonable best efforts to keep the Ignyte Common Stock listed for trading on the Nasdaq Capital Market.
Registration Rights Agreement
In connection with the Closing, Ignyte, Ignyte Sponsor LLC (the Sponsor) and certain stockholders of Target (collectively, with each other person who has executed and delivered a joinder thereto, the RRA Parties), will enter into a Registration Rights Agreement (the Registration Rights Agreement), pursuant to which, among other things, the Sponsor and the stockholders of the Target will be granted certain customary registration rights, demand rights and piggyback rights with respect to their respective shares of the Ignyte Common Stock. The Registration Rights Agreement will require Ignyte to, among other things, file a resale registration statement on behalf of the RRA Parties as soon as practicable but no later than 45 days after the Closing. The Registration Rights Agreement will also provide certain demand rights and piggyback rights to the RRA Parties, in each case subject to certain offering thresholds, applicable lock-up restrictions, issuer suspension periods and certain other conditions. The Registration Rights Agreement includes customary indemnification provisions. The Target will agree to pay certain fees and expenses relating to registrations under the Registration Rights Agreement.
The foregoing description of the Registration Rights Agreement is qualified in its entirety by reference to the full text of the form of Registration Rights Agreement, a copy of which is included as Exhibit A to the Business Combination Agreement, filed as Exhibit 2.1 to this Current Report on Form 8-K, and incorporated herein by reference.
Lock-Up Agreement
In connection with the Closing, Ignyte and certain stockholders of Target will enter into a lock-up agreement (the Lock-Up Agreement) providing for certain restrictions on transfer applicable to Ignyte Common Stock (the Lock-Up Shares). Generally, the Lock-Up Agreement prohibits stockholders from (i) selling, offering to sell, contracting or agreeing to sell, hypothecating, pledging, granting any option to purchase or otherwise disposing of or agreeing to dispose of, directly or indirectly, or establishing or increasing a put equivalent position or liquidating or decreasing a call equivalent position within the meaning of Section 16 of the Exchange Act, and the rules and regulations of the SEC promulgated thereunder with respect to the Lock-Up Shares, (ii) entering into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of the Lock-Up Shares, whether any such transaction is to be settled by delivery of Lock-Up Shares or other securities, in cash or otherwise, or (iii) publicly announcing any intention to effect any transaction specified in the immediately preceding subsections (i) or (ii), subject to certain limited exceptions set forth in the Lock-Up Agreement. The lock-up period under Lock-Up Agreement lasts until the date that is 180 days from the Closing Date (as defined in the Business Combination Agreement).
In connection with the Closing, Ignyte and Hoyoung Huh (the Key Company Stockholder) will enter into a separate Lock-Up Agreement (the Key Company Stockholder Lock-Up Agreement) on substantially the same terms as the Lock-Up Agreement with certain exceptions for the transactions contemplated by the Key Company Stockholder Forward Purchase Agreement (as defined below).
The foregoing descriptions of the Lock-Up Agreement and the Key Company Stockholder Lock-Up Agreement are qualified in their entirety by reference to the full text of the forms of Lock-Up Agreement and the Key Company Stockholder Lock-Up Agreement, copies of which are included as Exhibits B and H to the Business Combination Agreement, respectively, filed as Exhibit 2.1 to this Current Report on Form 8-K, and incorporated herein by reference.
PIPE Subscription Agreements
Concurrently with the execution and delivery of the Business Combination Agreement, certain existing accredited investors and institutional accredited investors (the PIPE Investors) and Ignyte entered into separate subscription agreements (the PIPE Subscription Agreements) pursuant to which the PIPE Investors have committed to subscribe for and purchase up to 2,550,000 shares (inclusive of the shares to be issued pursuant to the Key Company Stockholder Forward Purchase Agreement as described below) of Ignyte Common Stock (the PIPE Shares) at a purchase price per share of $10.00. The purchase of the PIPE Shares will be consummated concurrently with the Closing.
The PIPE Subscription Agreements contain customary representations and warranties of Ignyte, on the one hand, and each PIPE Investor, on the other hand, and customary conditions to closing, including the consummation of the Proposed Transactions. The purpose of the PIPE is to raise additional capital for use by Ignyte following the Closing.
Pursuant to the PIPE Subscription Agreements, Ignyte agreed that, within 30 calendar days after the Closing, Ignyte will file with the SEC a registration statement registering the resale of the PIPE Shares. Ignyte will also use its commercially reasonable efforts to have the registration statement declared effective as soon as practicable after the filing thereof but no later than the earlier of (i) the 90th calendar day following the filing date thereof if the SEC notifies Ignyte that it will review the Registration Statement and (ii) the 10th business day after the date Ignyte is notified (orally or in writing, whichever is earlier) by the SEC that the registration statement will not be reviewed or will not be subject to further review.
The foregoing description of the PIPE Subscription Agreements is qualified in its entirety by reference to the full text of the form of PIPE Subscription Agreement, a copy of which is filed as Exhibits 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Key Company Stockholder Forward Purchase Agreement
Concurrently with the execution and delivery of the Business Combination Agreement, Ignyte and the Key Company Stockholder entered into a forward purchase agreement substantially (the Key Company Stockholder Forward Purchase Agreement), pursuant to which the Key Company Stockholder will, upon the terms and subject to the conditions set forth in the Key Company Stockholder Forward Purchase Agreement, including, but not limited to the receipt of margin financing within 180 days following Closing, purchase shares of Ignyte Common Stock at a purchase price of $10.00 per share in a private placement for up to an aggregate amount of $10,000,000, subject to the conditions set forth in the Key Company Stockholder Forward Purchase Agreement.
The foregoing description of the Key Company Stockholder Forward Purchase Agreement is qualified in its entirety by reference to the full text of the form of Key Company Stockholder Forward Purchase Agreement, a copy of which is filed as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.
Sponsor Support Agreement
Concurrently with the execution of the Business Combination Agreement, the Sponsor entered into a Sponsor Support Agreement with Ignyte and the Company (the Sponsor Support Agreement), pursuant to which the Sponsor agreed to vote its shares of Ignyte Common Stock in favor of the approval and adoption of the Proposed Transactions. Additionally, the Sponsor has agreed, among other things, not to enter into any agreement that is inconsistent with the Sponsor Support Agreement.
The foregoing description of the Sponsor Support Agreement is qualified in its entirety by reference to the full text of the form of Sponsor Support Agreement, a copy of which is filed as Exhibit 10.3 to this Current Report on Form 8-K and incorporated herein by reference.
Closing
The Closing will occur as promptly as practicable, but in no event later than two business days following the satisfaction or waiver of all of the Closing conditions set forth in Article VII of the Business Combination Agreement.
Exclusivity
From the date of the Business Combination Agreement and ending on the earlier of (a) the Closing and/or (b) the termination of the Business Combination Agreement, Ignyte shall not take, nor shall it permit any of its affiliates or Representatives (as defined in the Business Combination Agreement) to take, whether directly or indirectly, any action to solicit, initiate, continue or engage in discussions or negotiations with, or enter into any agreement with, or encourage, respond, provide information to or commence due diligence with respect to, any person (other than the Target, its stockholders and/or any of their affiliates or Representatives), concerning, relating to or which is intended or is reasonably likely to give rise to or result in, any offer, inquiry, proposal or indication of interest, written or oral relating to any business combination transaction (a “Business Combination Proposal”) other than with the Target, its stockholders and their respective affiliates and Representatives. Ignyte shall, and shall cause its affiliates and Representatives to, immediately cease any and all existing discussions or negotiations with any person (other than with the Target, its stockholders and their respective affiliates and Representatives) conducted prior to the date hereof with respect to, or which is reasonably likely to give rise to or result in, a Business Combination Proposal.
Representations, Warranties and Covenants
The Business Combination Agreement contains customary representations, warranties and covenants of (a) the Target and (b) Ignyte and Korean Sub relating to, among other things, their ability to enter into the Business Combination Agreement and their outstanding capitalization.
Conditions to Closing
Mutual
The obligations of the Target, Ignyte and Korean Sub to consummate the Proposed Transactions, including the Business Combination, are subject to the satisfaction or waiver (where permissible) at or prior to the Closing of the following conditions:
(a) |
The approval of the requisite stockholders of Ignyte in favor of the adoption of the Business Combination Agreement and the Business Combination and all other transactions contemplated by the Business Combination Agreement; |
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(b) |
The Proposals (as defined in the Business Combination Agreement) have been approved and adopted by the requisite affirmative vote of the stockholders of Ignyte; |
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(c) |
No governmental authority has enacted, issued, promulgated, enforced or entered any law, rule, regulation, judgment, decree, executive order, or award which is then in effect and has the effect of making the Proposed Transactions, including the Business Combination, illegal or otherwise prohibiting consummation of the Proposed Transactions, including the Business Combination; |
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(d) |
All required filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”) shall have been completed and any applicable waiting period (and any extension thereof) applicable to the consummation of the Transactions under the HSR Act shall have expired or been terminated, and any pre-Closing approvals or clearances reasonably required thereunder shall have been obtained; |
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(e) |
The shares of Ignyte Common Stock shall be listed on Nasdaq as of the Closing Date (as defined in the Business Combination Agreement); and |
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(f) |
Immediately prior to the Closing, and after giving effect to the Redemption Rights (as defined in the Business Combination Agreement), Ignyte shall have cash and cash equivalents on hand of at least $7,500,000 |
Ignyte
The obligations of Ignyte and Korean Sub to consummate the Proposed Transactions are subject to the satisfaction or waiver (where permissible) at or prior to the Closing of the following additional conditions:
(a) |
Certain of the representations and warranties of the Target contained in the sections titled (a) “Organization, Qualification, Subsidiaries,” (b) “Capitalization” (c) “Authority Relative to the Business Combination Agreement” and (d) “Brokers” in the Business Combination Agreement are true and correct in all material respects as of the Closing Date (as defined in the Business Combination Agreement) as though made on the Closing Date (without giving effect to any limitation as to “materiality” or “Target Material Adverse Effect” (as defined in the Business Combination Agreement) or any similar limitation set forth therein), except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct in all material respects as of such earlier date. All other representations and warranties of the Target contained in the Business Combination Agreement shall be true and correct (without giving any effect to any limitation as to “materiality” or “Target Material Adverse Effect” or any similar limitation set forth therein) in all respects as of the Closing Date, as though made on and as of the Closing Date, except (i) to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date and (ii) where the failure of such representations and warranties to be true and correct (whether as of the Closing Date or such earlier date), taken as a whole, does not result in a Target Material Adverse Effect. |
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(b) |
The Target has performed or complied in all material respects with all covenants required by the Business Combination Agreement to be performed or complied with by it as of or prior to the Effective Time (as defined in the Business Combination Agreement); |
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(c) |
The Target has delivered to Ignyte a customary officer’s certificate, dated the date of the Closing, certifying as to the satisfaction of certain conditions; |
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(d) |
No Company Material Adverse Effect has occurred between the date of the Business Combination Agreement and the Closing Date (as defined in the Business Combination Agreement); |
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(e) |
The Target has delivered to Ignyte executed counterparts to all of the ancillary agreements to which the Target, or any stockholder of the Target, is party; |
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(f) |
Other than those persons identified as continuing directors in the Business Combination Agreement, all members of the Target’s board of directors and boards of directors of the Target Subsidiaries shall have executed written resignations effective as of the Effective Time (as defined in the Business Combination Agreement); |
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(g) |
The Key Company Stockholder Forward Purchase Agreement shall be in full force and effect. |
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(h) |
All parties to the Registration Rights Agreement (other than Ignyte) shall have delivered, or cause to be delivered, to Ignyte copies of the Registration Rights Agreement duly executed by all such parties; |
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(i) |
The Target has delivered, or has caused to be delivered, to Ignyte the Lock-Up Agreement duly executed by holders representing all of the Target Common Stock outstanding as of immediately prior to the Effective Time (as defined in the Business Combination Agreement); provided, however, in the event all such holders of the Company Common Stock outstanding as of immediately prior to the Effective Time do not execute the Lock-Up Agreement delivered to Ignyte, this condition shall be deemed to be satisfied if (i) such non-executing stockholders’ securities are not included for registration in the Registration Rights Agreement, (ii) none of such non-executing stockholders hold Company Common Stock in excess of 1% of the Company Common Stock outstanding immediately prior to the Effective time, and (iii) the aggregate number of shares of Company Common Stock held by all non-executing stockholders is less than 10% of the outstanding Company Common Stock immediately prior to the Effective time. |
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(j) |
The Target has delivered, or cause to be delivered, to Ignyte the Key Company Stockholder Lock-Up Agreement duly executed by the Key Company Stockholder. |
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(k) |
The Target has delivered, or cause to be delivered to Ignyte the Share Swap Agreement duly executed by the Target. |
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(l) |
On or prior to the Closing, the Target shall deliver to Ignyte a properly executed certification that shares of Target Common Stock are not “U.S. real property interests” in accordance with the Treasury Regulations under Sections 897 and 1445 of the Code, together with a notice to the Internal Revenue Service (the “IRS”) (which shall be filed by Ignyte with the IRS following the Closing) in accordance with the provisions of Section 1.897-2(h)(2) of the Treasury Regulations. |
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(m) |
The Target shall have delivered to Ignyte the PCAOB Financial Statements (as defined in the Business Combination Agreement). |
The Target
The obligations of the Target to consummate the Proposed Transactions are subject to the satisfaction or waiver (where permissible) at or prior to Closing of the following additional conditions:
(a) |
Certain of the representations and warranties of Ignyte and Korean Sub contained in the sections titled (a) “Corporate Organization,” (b) “Capitalization” (c) “Authority Relative to the Business Combination Agreement”; and (d) “Brokers” in the Business Combination Agreement shall each be true and correct in all material respects as of the Closing Date (as defined in the Business Combination Agreement) as though made on the Closing Date (without giving effect to any limitation as to “materiality” or “Ignyte Material Adverse Effect” or any similar limitation set forth therein), except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct in all material respects as of such earlier date. All other representations and warranties of Ignyte and Korean Sub contained in the Business Combination Agreement shall be true and correct (without giving any effect to any limitation as to “materiality” or “Ignyte Material Adverse Effect” (as defined in the Business Combination Agreement) or any similar limitation set forth therein) in all respects as of the Closing Date, as though made on and as of the Closing Date, except (i) to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date and (ii) where the failure of such representations and warranties to be true and correct (whether as of the Closing Date or such earlier date), taken as a whole, does not result in a Ignyte Material Adverse Effect; |
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(b) |
Ignyte and Korean Sub have each performed or complied in all material respects with all covenants required by the Business Combination Agreement to be performed or complied with by it as of or prior to the Closing; |
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(c) |
Ignyte has delivered to the Target a customary officer’s certificate, dated the date of the Closing, certifying as to the satisfaction of certain conditions; |
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(d) |
A supplemental listing shall have been filed with Nasdaq as of the Closing Date (as defined in the Business Combination Agreement) to list the shares constituting the Aggregate Closing Consideration (as defined in the Business Combination Agreement); |
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(e) |
Ignyte shall have delivered a copy of the Registration Rights Agreement duly executed by Ignyte and the Sponsor; |
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(f) |
Ignyte has delivered, or cause to be delivered to the Target the Share Swap Agreement (as defined in the Business Combination Agreement) duly executed by Korean Sub; |
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(g) |
The members of the board of directors and the officers of Ignyte identified in the disclosure schedules to the Business Combination Agreement have been removed from their respective positions or tendered their irrevocable resignations, in each case effective as of the Effective Time (as defined in the Business Combination Agreement); and |
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(h) |
The (i) amount of cash and cash equivalents available in the Trust Account (as defined in the Business Combination Agreement) immediately prior to the Closing, plus (ii) all other cash and cash equivalents of Ignyte, plus (iii) the aggregate amount of cash proceeds received from the PIPE Investment (as defined in the Business Combination Agreement)prior to or substantially concurrently with the Closing (without, for the avoidance of doubt, taking into consideration any transaction fees, costs and expenses paid or required to be paid by Ignyte prior to the Closing), shall be equal to or greater than $20,000,000. |
Termination
The Business Combination Agreement may be terminated and the Proposed Transactions may be abandoned at any time prior to the Effective Time, notwithstanding any requisite approval and adoption of the Business Combination Agreement and the Proposed Transactions by the stockholders of the Target or Ignyte, as follows:
(a) |
By mutual written consent of Ignyte and the Target; or |
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(b) |
by either Ignyte or the Target if the Effective Time (as defined in the Business Combination Agreement) shall not have occurred prior to October 28, 2022 (the “Outside Date”); provided, however, that the Business Combination Agreement may not be terminated under Section 8.01(b) therein by or on behalf of any party that either directly or indirectly through its affiliates is in breach or violation of any representation, warranty, covenant, agreement or obligation contained herein and such breach or violation is the principal cause of the failure of a condition set forth in Article VII of the Business Combination Agreement on or prior to the Outside Date; or |
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(c) |
by either Ignyte or the Target if any Governmental Authority (as defined in the Business Combination Agreement) in the United States or the Republic of Korea shall have enacted, issued, promulgated, enforced, or entered any injunction, order, decree or ruling (whether temporary, preliminary or permanent) which has become final and nonappealable and has the effect of making consummation of the Proposed Transactions, including the Business Combination, illegal or otherwise preventing or prohibiting consummation of the Transactions or the Business Combination; or |
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(d) |
by either Ignyte or the Target if any of the Ignyte Proposals (as defined in the Business Combination Agreement) shall fail to receive the requisite vote for approval at the Ignyte Stockholders’ Meeting (as defined in the Business Combination Agreement); or |
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(e) |
by Ignyte upon a breach of any representation, warranty, covenant or agreement on the part of the Target set forth in the Business Combination Agreement, or if any representation or warranty of the Target shall have become untrue, in either case such that the conditions set forth in Sections 7.02(a) and 7.02(b) would not be satisfied (“Terminating Target Breach”); provided that Ignyte has not waived such Terminating Target Breach and Ignyte and Korean Sub are not then in material breach of their representations, warranties, covenants or agreements in the Business Combination Agreement; provided further that, if such Terminating Target Breach is curable by the Target, Ignyte may not terminate the Business Combination Agreement under Section 8.01(e) for so long as the Target continues to exercise its reasonable efforts to cure such breach, unless such breach is not cured within thirty (30) days after notice of such breach is provided by Ignyte to the Target; or |
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(f) |
by the Target upon a breach of any representation, warranty, covenant or agreement on the part of Ignyte or Korean Sub set forth in the Business Combination Agreement, or if any representation or warranty of Ignyte or Korean Sub shall have become untrue, in either case such that the conditions set forth in Sections 7.03(a) and 7.03(b) would not be satisfied (“Terminating Ignyte Breach”); provided that the Target has not waived such Terminating Ignyte Breach and the Target is not then in material breach of their representations, warranties, covenants or agreements in the Business Combination Agreement; provided, however, that, if such Terminating Ignyte Breach is curable by Ignyte and Korean Sub, the Target may not terminate the Business Combination Agreement under Section 8.01(f) for so long as Ignyte and Korean Sub continue to exercise their reasonable efforts to cure such breach unless such breach is not cured within thirty (30) days after notice of such breach is provided by the Target to Ignyte; or |
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(g) |
by Ignyte if the PCAOB Financial Statements (as defined in the Business Combination Agreement) shall not have been delivered to Ignyte by the Target not later than 30 days from the date of the Business Combination Agreement. |
Effect of Termination
If the Business Combination Agreement is terminated, the Business Combination Agreement will forthwith become void, and there will be no liability under the Business Combination Agreement on the part of any party thereto, except as set forth in the Business Combination Agreement or in the case of termination subsequent to a willful material breach of the Business Combination Agreement by a party thereto.
Except as set forth in the Business Combination Agreement, all expenses incurred in connection with the Business Combination Agreement and the Proposed Transactions shall be paid by the party incurring such expenses, whether or not the Proposed Transactions are consummated. except that Ignyte and the Target will each pay one half of all expenses relating to all SEC and other regulatory filing fees incurred in connection with the Proxy Statement.
A copy of the Business Combination Agreement is filed with this Current Report on Form 8-K as Exhibit 2.1 and is incorporated herein by reference. The foregoing description of the Business Combination Agreement is qualified in its entirety by reference to the full text of the Business Combination Agreement filed with this Current Report on Form 8-K. The Business Combination Agreement is included to provide security holders with information regarding its terms. It is not intended to provide any other factual information about Ignyte, the Target or the other parties thereto. In particular, the assertions embodied in representations and warranties by Ignyte, the Target and Korean Sub contained in the Business Combination Agreement are qualified by information in the disclosure schedules provided by the parties in connection with the signing of the Business Combination Agreement. These disclosure schedules contain information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the Business Combination Agreement. Moreover, certain representations and warranties in the Business Combination Agreement were used for the purpose of allocating risk between the parties, rather than establishing matters as facts. Accordingly, security holders should not rely on the representations and warranties in the Business Combination Agreement as characterizations of the actual state of facts about Ignyte, the Target or Korean Sub.