Mountain Crest Acquisition Corp. V 8-K, filed Apr 24, 2024
Mountain Crest Acquisition Corp. V (MCAG)
About this 8-K
Mountain Crest Acquisition Corp. V filed this 8-K on April 24, 2024, reporting on events of April 19, 2024.
Items reported
- Item 1.01: Entered into a material agreement
- Item 3.02: Unregistered sale of equity
- Item 9.01: Financial statements and exhibits
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
(Exact Name of Registrant as Specified in its Charter)
| (State
or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S.
Employer Identification No.) |
| (Address of Principal Executive Offices) | (Zip Code) |
Registrant’s
telephone number, including area code:
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| The | ||||
| The | ||||
| The |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging
growth company
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01 Entry into a Material Definitive Agreement
As previously disclosed, on October 30, 2023, Mountain Crest Acquisition Corp. V (the “Company”) issued a non-interest bearing, unsecured promissory note in the aggregate principal amount of up to $400,000 (the “2023 Note”) to Mountain Crest Global Holdings LLC, a Delaware limited liability company and the Company’s sponsor (the “Sponsor”). On April 3, 2024, the Company issued a non-interest bearing, unsecured promissory note in the aggregate principal amount of up to $300,000 (the “2024 Note,” and together with the 2023 Note, the “Notes”) to the Sponsor.
As of April 15, 2024, the principal amount outstanding under the 2023 Note is $390,000 and the principal amount outstanding under the 2024 Note is $210,000. Collectively the principal amount outstanding under the Notes is $600,000 (the “Principal Amount due under the Notes”).
On April 19, 2024, as approved by the Company’s audit committee, the Company entered into a note conversion agreement (the “Note Conversion Agreement”) with the Sponsor, to convert the Principal Amount due under the Notes into 150,000 shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”). Accordingly, the Company satisfied the Notes in exchange for the issuance of 150,000 shares of Common Stock.
Pursuant to the Note Conversion Agreement, the Sponsor has (i) one demand registration of the sale of such shares at the Company’s expense, and (ii) unlimited “piggyback” registration rights, both for a period of five (5) years after the closing of the Company’s initial business combination at the Company’s expense.
The foregoing descriptions of the Note Conversion Agreement do not purport to be complete and are qualified in their entirety by reference to the Note Conversion Agreement, which filed as Exhibits 10.1, to this Current Report on Form 8-K, and which are incorporated herein by reference.
Item 3.02 Unregistered Sales of Equity Securities
The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02. On April 20, 2024, an aggregate of 150,000 shares of the Company’s Common Stock has been issued pursuant to the Note Conversion Agreement, in full payment and satisfaction of the Notes in the principal amount of $600,000. The Company has relied upon Sections 4(a)(2) and/or Regulation D of the Securities Act of 1933, as amended, in connection with the conversion, as the shares were issued to sophisticated investors without a view to distribution, and were not issued through any general solicitation or advertisement.
No Offer or Solicitation
This Current Report on Form 8-K is for informational purposes only and is not intended to and shall not constitute a proxy statement or the solicitation of a proxy, consent or authorization with respect to any securities or in respect of an initial business combination or PIPE financing and is not intended to and shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy or subscribe for any securities or a solicitation of any vote of approval, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
Item 9.01. Financial Statements and Exhibits.
| EXHIBIT NO. | DESCRIPTION | |
| 10.1* | Note Conversion Agreement entered by and between Mountain Crest Acquisition Corp. V and Mountain Crest Global Holdings LLC, dated April 19, 2024 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
| * | Certain terms have been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The Registrant hereby undertakes to furnish copies of any of the terms upon request by the SEC. |
1
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: April 24, 2024 | ||
| MOUNTAIN CREST ACQUISITION CORP. V | ||
| By: | /s/ Suying Liu | |
| Name: | Suying Liu | |
| Title: | Chief Executive Officer | |
2
Exhibit 10.1
NOTE CONVERSION AGREEMENT
This NOTE CONVERSION AGREEMENT (this “Agreement”) is made as of April 19, 2024 by and between Mountain Crest Acquisition Corp. V, a Delaware corporation (the “Company”), and Mountain Crest Global Holdings LLC, a Delaware limited liability company and the Company’s sponsor (the “Holder”).
R E C I T A L S
WHEREAS, the Company issued the Holder a non-interest bearing promissory note in the aggregate principal amount of $400,000, dated October 30, 2023 (the “2023 Note”);
WHEREAS, the 2023 Note provides that the principal balance shall be payable by the Company in cash at the earlier of (a) the closing of the Company’s initial business combination or (b) the liquidation of the Company;
WHEREAS, the Company issued the Holder a non-interest bearing promissory note in the aggregate principal amount of $300,000, dated April 3, 2024 (the “2024 Note,” and together with the 2023 Note, the “Notes”);
WHEREAS, the 2024 Note provides that the principal balance shall be payable by the Company in cash at the earlier of (a) the closing of the Company’s initial business combination or (b) the liquidation of the Company;
WHEREAS, as of April 15, 2024, the principal amount outstanding under the 2023 Note is $390,000 and the principal amount outstanding under the 2024 Note is $210,000. Collectively the principal amount outstanding under the Notes is $600,000 (the “Principal Amount due under the Notes”).
WHEREAS, upon the conversion of the Principal Amount due under the Notes to the Common Stock, all obligations of the Company under the Notes shall be extinguished; and
WHEREAS, the Company and the Holder are executing and delivering this Agreement in reliance upon an exemption from securities registration afforded by the provisions of Section 4(2), Section 4(6) and/or Regulation D as promulgated by the United States Securities and Exchange Commission under the Securities Act of 1933, as amended.
NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties, covenants, agreements and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:
1. Conversion of Notes into the Shares. The Company and the Holder acknowledge, agree, represent, warrant and covenant to each other as follows:
a. The Principal Amount due under the Notes shall be converted into 150,000 shares of Common Stock (the “Shares”). Within three (3) business days of the execution of this Agreement, the Company shall issue the Shares to the Holder in book-entry form and no certificate shall be issued therefor.
b. The Notes are hereby amended to provide for the immediate conversion of the Notes (in full satisfaction of the Notes).
c. The Principal Amount due under the Notes and the debt shall be fully and wholly satisfied and extinguished, and the Principal Amount due under the Notes shall be canceled and of no further force or effect, and neither Holder, nor any person or entity claiming under, through or by right of Holder, nor any successor, assignee or other party, shall make any further claim against the Company relating to or arising out of the Notes. A failure by Holder to deliver the original Notes to the Company on or after the date of this Agreement shall not have the effect of giving the Holder, or any person or entity claiming under, through or by right of Holder, nor any successor, assignee or other party, any rights therein or thereto, and Holder shall indemnify and hold harmless the Company, and their respective employees, officers, directors and agents, from any and all losses which arise directly or indirectly as a result of Holder’s breach of the representations made in this Agreement and/or a failure to deliver the original Notes to the Company which results in claims made therein, thereto or thereunder.
2. Registration Rights. The Company represents, warrants and agrees that with respect to the Shares, the Holder will have the following registration rights: (i) one demand registration of the sale of the Shares at the Company’s expense, and (ii) unlimited “piggyback” registration rights for a period of five (5) years after the closing of the Company’s initial business combination at the Company’s expense.
3. Representations and Warranties of the Holder. The Holder hereby represents and warrants to the Company as follows:
(a) The Holder has full power and authority to enter into this Agreement and to perform its obligations hereunder. This Agreement constitutes the Holder’s valid and legally binding obligation, enforceable in accordance with its terms.
(b) The Holder is the sole owner of the Principal Amount due under the Notes being delivered to the Company as consideration for the issuance of the Shares. The Principal Amount due under the Notes is being delivered to the Company free and clear of any and all liens, charges, encumbrances, security agreements, pledge agreements, conditional sales agreements or other obligations relating to the sale or transfer thereof.
(c) The Holder is acquiring the Shares for investment for the Holder’s own account and not with a view to, or for resale in connection with, any distribution thereof, and the Holder has no present intention of selling or distributing the Shares. The Holder understands that the Shares to be issued to the Holder have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), by reason of a specific exemption from the registration provisions of the Securities Act. The Holder is an “accredited investor” as that term is defined under the Securities Act.
2
(d) Restrictions on Resale.
(i) Legend. The Holder acknowledges that until registered under the Securities Act, the certificates representing the Shares shall bear the following or similar legend:
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THESE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.”
(ii) Stop Order. The Holder further acknowledges that the Company reserves the right to place a stop order against the instruments representing the Shares and to refuse to effect any transfers thereof in the absence of an effective registration statement with respect to the Shares or in the absence of an opinion of counsel to the Company that such transfer is exempt from registration under the Securities Act and under applicable state securities laws.
4. Representations and Warranties of the Company. The Company hereby represents and warrants to the Holder as follows:
(a) The Company has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder. This Agreement constitutes the Company’s valid and legally binding obligation, enforceable in accordance with its terms.
(b) The issuance of the Shares has been duly authorized by the Company and the Shares, when issued upon conversion of the Notes in accordance with the terms hereof, will be validly issued and outstanding, fully paid and nonassessable.
5. General.
(a) The parties agree that if changes to any terms of this Agreement are necessary to comply with applicable federal securities laws or regulations, or requirements of The Nasdaq Stock Market, LLC, or other national securities exchange, or over the counter market on which the Common Stock of the Corporation is listed, quoted and/or traded, the parties hereby agree to negotiate in good faith to amend this Agreement accordingly to be in compliance with such laws and regulations.
(b) This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, regardless of the laws that might otherwise govern under applicable principles of conflicts of law.
(c) The provisions of this Agreement shall inure to the benefit of, and be binding upon, the successors, assigns, transferees, heirs, legatees, executors, administrators and personal representatives of the parties hereto.
3
(d) This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof, and this Agreement supersedes and renders null and void any and all other prior oral or written agreements, understandings or commitments pertaining to the subject matter hereof.
(e) This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original and all of which taken together, shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail (including pdf or any electronic signature) or other transmission method, and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
[Remainder of page intentionally left blank]
4
IN WITNESS WHEREOF, the parties have executed this Note Conversion Agreement as of the date first written above.
| MOUNTAIN CREST ACQUISITION CORP. V | |||
| By: | /s/ Suying Liu | ||
| Name: | Suying Liu | ||
| Title: | Chief Executive Officer | ||
| HOLDER: | |||
| MOUNTAIN CREST GLOBAL HOLDINGS LLC | |||
| By: | /s/ Dong Liu | ||
| Name: | Dong Liu | ||
| Title: | Manager | ||
5