Cartesian Growth Corp II DEFA14A, filed Nov 8, 2024
Cartesian Growth Corp II (RENEF)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 6, 2024
Cartesian Growth Corporation II
(Exact name of registrant as specified in its charter)
| Cayman Islands | 001-41378 | N/A |
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
|
505 Fifth Avenue, 15th Floor New York, New York |
10017 |
| (Address of principal executive offices) | (Zip Code) |
(212) 461-6363
(Registrant’s telephone number, including area code)
Not Applicable
(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 (17 CFR 230.425) |
| x | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) |
Name of each exchange on which registered | ||
| Units, each consisting of one class A ordinary share and one-third of one Warrant | RENEU | The Nasdaq Stock Market LLC | ||
| Class A ordinary shares, par value $0.0001 per share | RENE | The Nasdaq Stock Market LLC | ||
| Warrants, each whole warrant exercisable for one Class A ordinary share at an exercise price of $11.50 | RENEW | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company x
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.
The information provided in Item 2.03 of this Current Report on Form 8-K is also incorporated by reference into this Item 1.01.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
In connection with the Extension Payments (as defined below), on November 6, 2024, Cartesian Growth Corporation II (the “Company”) issued an unsecured promissory note in the aggregate amount of up to $2,400,000 (the “Extension Note”) to CGC II Sponsor LLC (the “Sponsor”). On November 7, 2024, the Sponsor deposited an Extension Payment in the amount of $150,000, representing the lesser of (a) an aggregate of $150,000 and (b) $0.03 per public share that remained outstanding and unredeemed prior to the Extension (as defined below), which enabled the Company to extend the period of time it has to consummate its initial business combination by one month from November 10, 2024 to December 5, 2025. The Extension is the first of twelve one-month extensions permitted under the Company’s Charter (as defined below).
The Extension Note bears no interest and the principal balance is payable on the date of the consummation of the Company’s initial business combination. The Extension Note is subject to customary events of default, the occurrence of certain of which automatically triggers the unpaid principal balance of the Extension Note and all other sums payable with regard to the Extension Note becoming immediately due and payable. The principal balance may be prepaid at any time.
A copy of the Extension 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 Extension Note.
On November 6, 2024, the Company issued an unsecured promissory note in the principal amount of $250,000 (the “Working Capital Note”) to the Sponsor, which was funded in its entirety by the Sponsor. The Working Capital Note does not bear interest and the principal balance will be payable on the earlier to occur of (i) the date on which the Company consummates its initial business combination and (ii) the date that the winding up of the Company is effective. In the event the Company consummates its initial business combination, the Sponsor has the option to convert all or any portion of the principal outstanding under the Working Capital Note into that number of warrants equal to the portion of the principal amount of the Working Capital Note being converted divided by $1.00, rounded up to the nearest whole number.
A copy of the Working Capital Note is attached as Exhibit 10.2 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 Working Capital Note.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On November 6, 2024, the Company’s shareholders approved an amendment to the Company’s Amended and Restated Memorandum and Articles of Association (as amended, the “Charter”), which became effective solely upon the approval by the Company’s shareholders thereof. The information disclosed in Item 5.07 of this Current Report on Form 8-K is incorporated by reference into this Item 5.03 to the extent required herein.
Item 5.07. Submission of Matters to a Vote of Security Holders.
On November 6, 2024, the Company held an extraordinary general meeting of shareholders (the “Extraordinary Meeting”). On October 15, 2024, the record date for the Extraordinary Meeting, there were 21,620,561 ordinary shares issued and outstanding entitled to be voted at the Extraordinary Meeting (consisting of 21,620,559 shares of Class A ordinary shares and two shares of Class B ordinary shares of the Company), approximately 89.839% of which were represented in person or by proxy at the Extraordinary Meeting.
The final results for each of the matters submitted to a vote of the Company’s shareholders at the Extraordinary Meeting are as follows:
1. The Extension Proposal
The shareholders approved the proposal to amend the Company’s Charter to extend the date by which the Company must (1) effect a merger, share exchange, asset acquisition, share purchase, or reorganization or engaging in any other similar business combination with one or more businesses or entities, which we refer to as our initial business combination, (2) cease its operations except for the purpose of winding up if it fails to complete such initial business combination, and (3) redeem all of the Class A ordinary shares, par value $0.0001 per share, of the Company (“Class A Ordinary Shares”), included as part of the units sold in the Company’s initial public offering that was consummated on May 10, 2022 (the “IPO”) if it fails to complete such initial business combination, from November 10, 2024 (the “Current Termination Date”) to up to November 5, 2025, by electing to extend the date to consummate an initial business combination on a monthly basis for up to twelve (12) times by an additional one month each time (other than the first period, which shall consist of 25 days), unless the closing of the Company’s initial business combination has occurred (such applicable later date, the “Extended Date” and such proposal, the “Extension Proposal”), without the need for any further approval of the Company’s shareholders, provided that CGC II Sponsor LLC (the “Sponsor”) (or its affiliates or permitted designees) will deposit into the trust account established in connection with the IPO (the “Trust Account”) (x) for each such one-month period (other than the first period, which shall consist of 25 days) from November 10, 2024 (exclusive) to May 5, 2025, the lesser of (i) an aggregate of US$150,000 and (ii) US$0.03 per public share that remains outstanding and is not redeemed prior to such one-month (other than the first period, which shall consist of 25 days) extension; and (y) for each such one-month period from May 5, 2025 (exclusive) to November 5, 2025, the lesser of (i) an aggregate of US$250,000 and (ii) US$0.05 per public share that remains outstanding and is not redeemed prior to such one-month extension (each, an “Extension Payment”), unless the closing of the Company’s initial business combination has occurred, in exchange for a non-interest bearing promissory note payable upon consummation of an initial business combination. The voting results were as follows:
| FOR | AGAINST | ABSTAIN | BROKER NON-VOTES | |||
| 17,514,537 | 1,909,169 | 0 | 0 |
A copy of the Extension Proposal is attached to this Current Report on Form 8-K as Exhibit 3.1 and incorporated herein by reference.
2. The NTA Requirement Amendment Proposal
The shareholders approved the proposal to amend the Company’s Charter to eliminate (i) the limitation that the Company shall not redeem the Class A Ordinary Shares to the extent that such redemption would result in the Company’s failure to have net tangible assets of at least $5,000,001, upon consummation of the Company’s initial business combination (such limitation, the “Redemption Limitation”), and (ii) the requirement that the Company shall not consummate an initial business combination unless the Redemption Limitation is not exceeded (together, the “NTA Requirement Amendment Proposal”). The voting results were as follows:
| FOR | AGAINST | ABSTAIN | BROKER NON-VOTES | |||
| 18,462,514 | 961,184 | 8 | 0 |
A copy of the NTA Requirement Amendment Proposal is attached to this Current Report on Form 8-K as Exhibit 3.2 and incorporated herein by reference.
Item 8.01. Other Events.
In connection with the votes to approve the Extension, the holders of 8,620,849 shares of Class A ordinary shares of the Company properly exercised their right to redeem their shares for cash at a redemption price of approximately $11.55 per share, for an aggregate redemption amount of $99,613,642.00 million, leaving $83,770,196.61 million in the Trust Account.
Item 9.01. Financial Statements and Exhibits
(c) Exhibits:
| Exhibit No. |
Description | |
| 3.1 | Amendment to the Amended and Restated Memorandum and Articles of Association | |
| 3.2 | Amendment to the Amended and Restated Memorandum and Articles of Association | |
| 10.1 | Promissory Note issued in favor of CGC II Sponsor LLC, dated November 6, 2024 | |
| 10.2 | Promissory Note issued in favor of CGC II Sponsor LLC, dated November 6, 2024 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |
SIGNATURE
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.
CARTESIAN GROWTH CORPORATION II
| By: | /s/ Peter Yu | |
| Name: | Peter Yu | |
| Title: | Chief Executive Officer |
Date: November 8, 2024
Exhibit 3.1
AMENDMENT TO THE
AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION
OF
CARTESIAN GROWTH CORPORATION II
RESOLUTION OF THE SHAREHOLDERS OF THE COMPANY
RESOLVED, as a special resolution: that the Amended and Restated Memorandum and Articles of Association of the Company be amended by the deletion of the existing Articles 49.7 and 49.8 in their entirety and the insertion of the following language in their place:
49.7 In the event that the Company does not consummate a Business Combination by November 10, 2024 (the “Termination Date”), 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 and up to US$100,000 of interest to pay dissolution expenses), divided by the number of then Public Shares in issue, which redemption will completely extinguish public Members’ rights as Members (including the right to receive further liquidation distributions, if any); and | |
| (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, |
subject in each case to its obligations under Cayman Islands law to provide for claims of creditors and other requirements of Applicable Law. Notwithstanding the foregoing or any other provision of the Articles, without the need for any further approval of the Members, the Directors may, if requested by the Sponsor and upon five days’ notice prior to the applicable deadline, extend the Termination Date by up to twelve (12) times, each by an additional one month (other than the first period, which shall consist of 25 days) (each, an “Extended Termination Date”), subject to the Sponsor, or its affiliates or permitted designees, depositing into the Trust Account on or prior to the date of the applicable deadline (x) for each such one-month period (other than the first period, which shall consist of 25 days) from November 10, 2024 (exclusive) to May 5, 2025, the lesser of (i) an aggregate of US$150,000 and (ii) US$0.03 per Public Share that remains outstanding and is not redeemed prior to such one-month (other than the first period, which shall consist of 25 days) extension; and (y) for each such one-month period from May 5, 2025 (exclusive) to November 5, 2025, the lesser of (i) an aggregate of US$250,000 and (ii) US$0.05 per Public Share that remains outstanding and is not redeemed prior to such one-month extension.
49.8 In the event that any amendment is made to the Articles:
| (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 by the Termination Date (or, if the Directors have resolved to extend the period of time to consummate a Business Combination as described in Article 49.7, by the applicable Extended Termination Date); or; | |
| (b) | with respect to any other provision relating to Members’ rights or pre-Business Combination activity, |
each holder of Public Shares who is not the Sponsor, DirectorCo, a Founder, Officer or Director shall be provided 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, divided by the number of then outstanding Public Shares. The Company’s ability to provide such redemption in this Article is subject to the Redemption Limitation and any applicable requirements for redemption herein, as the Company may specify from time to time in its discretion.
Exhibit 3.2
AMENDMENT TO THE
AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION
OF
CARTESIAN GROWTH CORPORATION II
RESOLUTION OF THE SHAREHOLDERS OF THE COMPANY
RESOLVED, as a special resolution: that the Amended and Restated Memorandum and Articles of Association of the Company be amended as follows:
| 1. | the deletion of the existing Articles 49.2, 49.4 and 49.5 in their entirety and the insertion of the following language in their respective places: |
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, if any), divided by the number of then issued Public Shares. |
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, DirectorCo, a Founder, Officer or Director may, in connection with 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. 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 not previously released to the Company to pay its taxes, 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.
| 2. | the deletion of “The Company’s ability to provide such redemption in this Article is subject to the Redemption Limitation and any applicable requirements for redemption herein, as the Company may specify from time to time in its discretion.” from Article 49.8. |
Exhibit 10.1
THIS PROMISSORY NOTE (“NOTE”) HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT ONLY AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF REGISTRATION OF THE RESALE THEREOF UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY IN FORM, SCOPE AND SUBSTANCE TO THE MAKER THAT SUCH REGISTRATION IS NOT REQUIRED.
PROMISSORY NOTE
| Principal Amount: Not to Exceed $2,400,000 | Dated as of November 6, 2024 |
Cartesian Growth Corporation II., a Cayman Islands exempted company (“Maker”), promises to pay to the order of CGC II Sponsor LLC, a Cayman Islands limited liability company, or its registered assigns or successors in interest (“Payee”), the principal sum of Two Million Four Hundred Thousand Dollars ($2,400,000) or such lesser amount as shall have been advanced by Payee to Maker and shall remain unpaid under this promissory NOTE (this “Note”), in lawful money of the United States of America, on the terms and conditions described below. All payments on this Note shall be made by check or wire transfer of immediately available funds or as otherwise determined by the Maker to such account as the Payee may from time to time designate by written notice in accordance with the provisions of this Note.
1. Principal. The principal balance of this Note shall be payable on the date on which an initial business combination is consummated (the “Maturity Date”). The principal balance may be prepaid at any time.
2. Interest. No interest shall accrue on the unpaid principal balance of this Note.
3. Application of Payments. All payments shall be applied first to payment in full of any costs incurred in the collection of any sum due under this Note, including (without limitation) reasonable attorney’s fees, then to the payment in full of any late charges and finally to the reduction of the unpaid principal balance of this Note.
4. Form of Repayment. All amounts due under this Note shall be repaid in cash. In the event that an initial business combination is not consummated for any reason, no payment shall be due hereunder and the principal balance of this Note shall be forgiven. Under no circumstances shall any individual, including but not limited to, any officer, director, employee or stockholder of Maker, be obligated personally for any obligations or liabilities of Maker hereunder.
5. Use of Proceeds. Maker hereby represents, warrants and covenants to Payee that the entire principal amount will be used by Maker solely for purposes of making one or more payments to Continental Stock Transfer & Trust Company, a New York limited liability trust company, as Extension Payments (as defined in the Maker’s definitive proxy statement filed with the Securities and Exchange Commission on October 24, 2024, as amended) and pursuant to the Maker’s amended and restated memorandum and articles of association, as amended.
6. Events of Default. The following shall constitute an event of default (“Event of Default”):
(a) Failure to Make Required Payments. Failure by Maker to pay the principal amount due pursuant to this Note within five (5) business days of the date specified above.
(b) Voluntary Bankruptcy, Etc. The commencement by Maker of a voluntary case under any applicable bankruptcy, insolvency, reorganization, rehabilitation or other similar law, or the consent by it to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of Maker or for any substantial part of its property, or the making by it of any assignment for the benefit of creditors, or the failure of Maker generally to pay its debts as such debts become due, or the taking of corporate action by Maker in furtherance of any of the foregoing.
(c) Involuntary Bankruptcy, Etc. The entry of a decree or order for relief by a court having jurisdiction in the premises in respect of Maker in an involuntary case under any applicable bankruptcy, insolvency or other similar law, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of Maker or for any substantial part of its property, or ordering the winding- up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days.
7. Remedies.
(a) Upon the occurrence of an Event of Default specified in Section 6(a) hereof, Payee may, by written notice to Maker, declare this Note to be due immediately and payable, whereupon the unpaid principal amount of this Note, and all other amounts payable thereunder, shall become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived, anything contained herein or in the documents evidencing the same to the contrary notwithstanding.
(b) Upon the occurrence of an Event of Default specified in Sections 6(b) and 6(c), the unpaid principal balance of this Note, and all other sums payable with regard to this Note, shall automatically and immediately become due and payable, in all cases without any action on the part of Payee.
8. Waivers. Maker and all endorsers and guarantors of, and sureties for, this Note waive presentment for payment, demand, notice of dishonor, protest, and notice of protest with regard to the Note, all errors, defects and imperfections in any proceedings instituted by Payee under the terms of this Note, and all benefits that might accrue to Maker by virtue of any present or future laws exempting any property, real or personal, or any part of the proceeds arising from any sale of any such property, from attachment, levy or sale under execution, or providing for any stay of execution, exemption from civil process, or extension of time for payment; and Maker agrees that any real estate that may be levied upon pursuant to a judgment obtained by virtue hereof, on any writ of execution issued hereon, may be sold upon any such writ in whole or in part in any order desired by Payee.
9. Unconditional Liability. Maker hereby waives all notices in connection with the delivery, acceptance, performance, default, or enforcement of the payment of this Note, and agrees that its liability shall be unconditional, without regard to the liability of any other party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Payee, and consents to any and all extensions of time, renewals, waivers, or modifications that may be granted by Payee with respect to the payment or other provisions of this Note, and agrees that additional makers, endorsers, guarantors, or sureties may become parties hereto without notice to Maker or affecting Maker’s liability hereunder.
10. Notices. All notices, statements or other documents which are required or contemplated by this Note shall be: (i) in writing and delivered personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party and (iii) by electronic mail, to the electronic mail address most recently provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.
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11. Construction. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION.
12. Severability. Any provision contained in this Note which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
13. Trust Waiver. Notwithstanding anything herein to the contrary, Payee hereby waives any and all right, title, interest or claim of any kind (“Claim”) in or to any distribution of or from the trust account in which a portion of the proceeds of Maker’s initial public offering (the “IPO”) were deposited, as described in greater detail in the prospectus filed with the SEC in connection with the IPO, and hereby agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against the trust account for any reason whatsoever.
14. Amendment; Waiver. Any amendment hereto or waiver of any provision hereof may be made with, and only with, the written consent of the Maker and the Payee.
15. Assignment. No assignment or transfer of this Note or any rights or obligations hereunder may be made by any party hereto (by operation of law or otherwise) without the prior written consent of the other party hereto and any attempted assignment without the required consent shall be void.
[Signature Page Follows]
| 3 |
IN WITNESS WHEREOF, Maker, intending to be legally bound hereby, has caused this Note to be duly executed by the undersigned as of the day and year first above written.
| Maker: | ||
| CARTESIAN GROWTH CORPORATION II | ||
| By: | /s/ Peter Yu | |
| Name: Peter Yu | ||
| Title: Chief Executive Officer | ||
[Signature Page to Promissory Note]
Exhiibit 10.2
THIS PROMISSORY NOTE (THIS “NOTE”) AND THE SECURITIES INTO WHICH THE NOTE MAY BE CONVERTED HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE. THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT ONLY AND THIS NOTE AND THE SECURITIES INTO WHICH THIS NOTE MAY BE CONVERTED MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF REGISTRATION OF THE RESALE THEREOF UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY IN FORM, SCOPE AND SUBSTANCE TO THE MAKER THAT SUCH REGISTRATION IS NOT REQUIRED.
PROMISSORY NOTE
| Principal Amount: $250,000 | Dated as of November 6, 2024 |
Cartesian Growth Corporation II, a Cayman Islands exempted company (“Maker”), promises to pay to the order of CGC II Sponsor LLC, a Cayman Islands limited liability company, or its registered assigns or successors in interest (“Payee”), the principal sum of Two Hundred Fifty Thousand Dollars ($250,000) in lawful money of the United States of America, on the terms and conditions described below. All payments on this Note shall be made by check or wire transfer of immediately available funds or as otherwise determined by Maker to such account as Payee may from time to time designate by written notice in accordance with the provisions of this Note.
1. Principal. The principal balance of this Note shall be payable on the earliest to occur of (i) the date on which Maker consummates its initial business combination and (ii) the date that the winding up of Maker is effective (such date, the “Maturity Date”). The principal balance may be prepaid at any time. Under no circumstances shall any individual, including but not limited to any officer, director, employee or shareholder of Maker, be obligated personally for any obligations or liabilities of Maker hereunder.
2. Interest. No interest shall accrue on the unpaid principal balance of this Note.
3. Drawdown. Upon execution of this Note, Payee shall fund Two Hundred Fifty Thousand Dollars ($250,000).
4. Application of Payments. All payments shall first be applied to the payment in full of any costs incurred in connection with the collection of any sum due under this Note, including (without limitation) reasonable attorney’s fees, then to the payment in full of any late charges and finally to the reduction of the unpaid principal balance of this Note.
5. Conversion.
(a) At Payee’s option, on the Maturity Date in the event Maker consummates its initial business combination, Payee may elect to convert all or any portion of the principal outstanding under this Note into that number of warrants (“Working Capital Warrants”) equal to: (i) the portion of the principal amount of this Note being converted pursuant to this Section 5, divided by (ii) $1.00, rounded up to the nearest whole number. Each Working Capital Warrant shall have the same terms and conditions as the warrants issued by Maker pursuant to a private placement to Payee (the “Private Placement”), as described in the prospectus (the “Prospectus”) for Maker’s initial public offering (the “IPO”) dated May 5, 2022 and filed with the U.S. Securities and Exchange Commission, including the transfer restrictions applicable thereto. The Working Capital Warrants and the Class A ordinary shares underlying such warrants, and any other equity security of Maker issued or issuable with respect to the foregoing by way of a share dividend or share split or in connection with a combination of shares, recapitalization, merger, consolidation or reorganization, shall be entitled to the registration rights set forth in that certain registration rights agreement among Maker, Payee and the other parties thereto, dated as of May 5, 2022.
(b) Upon any complete or partial conversion of the principal amount of this Note, (i) such principal amount shall be so converted and such converted portion of this Note shall become fully paid and satisfied, (ii) Payee shall surrender and deliver this Note, duly endorsed, to Maker or such other address which Maker shall designate against delivery of the Working Capital Warrants, (iii) Maker shall promptly deliver a new duly executed Note to Payee in the principal amount that remains outstanding, if any, after any such conversion and (iv) in exchange for all or any portion of the surrendered Note, Maker shall, within five (5) business days following receipt by Maker of Payee’s election to convert this Note pursuant to this Section 5, deliver to Payee the Working Capital Warrants, which shall bear such legends as are required in the opinion of counsel to Maker or by any other agreement between Maker and Payee and applicable state and federal securities laws.
(c) Payee shall pay any and all issue and other taxes that may be payable with respect to any issue or delivery of the Working Capital Warrants upon conversion of this Note pursuant hereto; provided, however, that Payee shall not be obligated to pay any transfer taxes resulting from any transfer requested by Payee in connection with any such conversion.
(d) The Working Capital Warrants shall not be issued upon conversion of this Note unless such issuance and such conversion comply with all applicable provisions of law. No fractional warrants shall be issued upon conversion of this Note. For the avoidance of doubt, in the event that all principal on this Note has been paid in full on or prior to the Maturity Date, then Payee shall not be entitled to convert any portion of this Note into Working Capital Warrants. Upon conversion of this Note in full, this Note shall be cancelled and void without further action of Maker or Payee, and Maker shall be forever released from all its obligations and liabilities under this Note.
6. Events of Default. The following shall constitute an event of default (each, an “Event of Default”):
(a) Failure to Make Required Payments. Failure by Maker to pay the principal amount due pursuant to this Note within five (5) business days of the date specified in Section 1 above.
(b) Voluntary Bankruptcy, Etc. The commencement by Maker of a voluntary case under any applicable bankruptcy, insolvency, reorganization, rehabilitation or other similar law, or the consent by it to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of Maker or for any substantial part of its property, or the making by it of any assignment for the benefit of creditors, or the failure of Maker generally to pay its debts as such debts become due, or the taking of corporate action by Maker in furtherance of any of the foregoing.
(c) Involuntary Bankruptcy, Etc. The entry of a decree or order for relief by a court having jurisdiction in the premises in respect of Maker in an involuntary case under any applicable bankruptcy, insolvency or other similar law, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of Maker or for any substantial part of its property, or ordering the winding-up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days.
7. Remedies. Subject to Section 13 below:
(a) Upon the occurrence of an Event of Default specified in Section 6(a) hereof, Payee may, by written notice to Maker, declare this Note to be due immediately and payable, whereupon the unpaid principal amount of this Note, and all other amounts payable hereunder, shall become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived, anything contained herein or in the documents evidencing the same to the contrary notwithstanding.
(b) Upon the occurrence of an Event of Default specified in Sections 6(b) or 6(c), the unpaid principal balance of this Note, and all other sums payable with regard to this Note, shall automatically and immediately become due and payable, in all cases without any action on the part of Payee.
8. Waivers. Maker and all endorsers and guarantors of, and sureties for, this Note waive presentment for payment, demand, notice of dishonor, protest, and notice of protest with regard to this Note, all errors, defects and imperfections in any proceedings instituted by Payee under the terms of this Note, and all benefits that might accrue to Maker by virtue of any present or future laws exempting any property, real or personal, or any part of the proceeds arising from any sale of any such property, from attachment, levy or sale under execution, or providing for any stay of execution, exemption from civil process, or extension of time for payment; and Maker agrees that any real estate that may be levied upon pursuant to a judgment obtained by virtue hereof, on any writ of execution issued hereon, may be sold upon any such writ in whole or in part in any order desired by Payee.
9. Unconditional Liability. Maker hereby waives all notices in connection with the delivery, acceptance, performance, default, or enforcement of the payment of this Note, and agrees that its liability shall be unconditional, without regard to the liability of any other party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Payee, and consents to any and all extensions of time, renewals, waivers, or modifications that may be granted by Payee with respect to the payment or other provisions of this Note, and agrees that additional makers, endorsers, guarantors, or sureties may become parties hereto without notice to Maker or affecting Maker’s liability hereunder.
10. Notices. All notices, statements or other documents which are required or contemplated by this Note shall be in writing and delivered: (i) personally or sent by first class registered or certified mail, overnight courier service to the address designated in writing by such party, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party or (iii) by electronic mail, to the electronic mail address most recently provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic mail, one (1) business day after delivery to an overnight courier service or five(5) days after mailing if sent by mail.
11. Construction and Governing Law. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF.
12. Severability. Any provision contained in this Note which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
13. Trust Waiver. Notwithstanding anything herein to the contrary, Payee hereby waives any and all right, title, interest or claim of any kind (“Claim”) in or to any distribution of or from the trust account in which a portion of the proceeds of the IPO and the Private Placement were deposited, as described in greater detail in the Prospectus, and hereby agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against the trust account for any reason whatsoever; provided, however, that upon the consummation of the initial business combination, Maker shall repay the principal balance of this Note out of the proceeds released to Maker from the trust account.
14. Amendment; Waiver. Any amendment hereto or waiver of any provision hereof may be made with, and only with, the written consent of Maker and Payee, except to the extent deemed given by Maker pursuant to Section 8 and 9 above.
15. Assignment. No assignment or transfer of this Note or any rights or obligations hereunder may be made by any party hereto (by operation of law or otherwise) without the prior written consent of the other party hereto and any attempted assignment without the required consent shall be void; provided, however, that the foregoing shall not apply to an affiliate of Payee who agrees to be bound by the terms of this Note.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, Maker and Payee, intending to be legally bound hereby, have caused this Note to be duly executed by the undersigned as of the day and year first above written.
| CARTESIAN GROWTH CORPORATION II | ||
| By: | /s/ Peter Yu | |
| Name: | Peter Yu | |
| Title: | Chief Executive Officer | |
| Acknowledged and Agreed: | ||
| CGC II SPONSOR LLC | ||
| By: | /s/ Beth Michelson | |
| Name: | Beth Michelson | |
| Title: | Manager and Vice President | |
[Signature Page to Promissory Note]