Introductory Note
As previously disclosed, on August 2, 2021, VPC Impact Acquisition Holdings II, an exempted company incorporated in the Cayman Islands with limited liability (“VIH”), entered into a Business Combination Agreement (the “Business Combination Agreement”), by and among VIH, AG1 Holdings, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (“Kredivo”), AG2 Holdings, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (“Merger Sub”), FinAccel Pte. Ltd., a Singapore private company limited by shares (“FinAccel”), each shareholder of FinAccel as set forth on Schedule 1 of the Business Combination Agreement, and Akshay Garg in his capacity as Shareholders Representative (as defined in the Business Combination Agreement).
On September 29, 2021, in accordance with Section 13.18 of the Business Combination Agreement, the parties entered into the First Amendment to Business Combination Agreement (the “Amendment”), pursuant to which the definition of “Minimum Available Cash Amount” in the Business Combination Agreement was amended to mean an amount equal to Three Hundred Ten Million Dollars ($310,000,000), along with certain other technical clarifications. All other terms of the Business Combination Agreement remained unchanged.
| Item 1.01. | Entry Into A Material Definitive Agreement. |
The information set forth in Item 1.02 of this Current Report on Form 8-K is incorporated herein by reference.
| Item 1.02. | Termination of a Material Definitive Agreement. |
On March 11, 2022, VIH, Kredivo, Merger Sub, FinAccel and Akshay Garg entered into a Termination and Fee Agreement (the “Termination Agreement”). Pursuant to the Termination Agreement, the parties agreed to mutually terminate the Business Combination Agreement, subject to the conditions set forth in the Termination Agreement. In conjunction with the termination of the Business Combination Agreement, the Subscription Agreements, the Investor Rights Agreement, the Founder Holder Agreement and the other Ancillary Documents (as each is defined in the Business Combination Agreement) have also automatically been terminated in accordance with their respective terms as of the date of this Current Report on Form 8-K. Upon termination of the Founder Holder Agreement, that certain Letter Agreement, dated as of March 4, 2021, by and among VIH, its executive officers, its directors and the Company’s sponsor, VPC Impact Acquisition Holdings Sponsor II, LLC, shall revert back to the executed version as disclosed in Exhibit 10.1 to VIH’s Current Report on Form 8-K on March 9, 2021.
The Termination Agreement provides that VIH will be entitled to receive (i) an aggregate sum not to exceed $4,000,000 in reimbursement for certain documented out-of-pocket third party expenses incurred by VIH (the “Termination Reimbursement Amount”), which is payable by FinAccel within 6 months of the date of the Termination Agreement and (ii) if VIH has not consummated an initial business combination and has determined to redeem its public shares and liquidate or dissolve thereafter (and does not withdraw such determination), FinAccel will issue and deliver to VIH a penny warrant, on terms mutually agreeable to FinAccel and VIH, to purchase a number of ordinary shares of FinAccel equal to three and one-half percent (3.5%) of the Fully Diluted Share Number (as defined in the Termination Agreement) of FinAccel as of the date of the Termination Agreement, as appropriately adjusted (the “Equity Termination Fee”). If FinAccel engages in any transaction that would be deemed a Sale of the Company (as defined in the Termination Agreement), then the party surviving the sale transaction will assume the foregoing obligation, to satisfy the Equity Termination Fee. If FinAccel fails to pay the Termination Reimbursement Amount, then a default interest of five percent (5%) per annum will accrue on a daily basis from the date the Termination Reimbursement Amount was due and payable until all such unpaid amounts have been paid.
