Business Context and Reporting Period
This Form 8-K, dated June 28, 2023, reports that Semper Paratus Acquisition Corporation (a Cayman Islands exempted company) has entered into a definitive Merger Agreement with Tevogen Bio Inc. The transaction involves a merger where Semper Paratus will domesticate as a Delaware corporation and merge with Tevogen Bio, with Tevogen Bio surviving as a wholly-owned subsidiary. The filing outlines the terms of the business combination, including consideration, conditions to closing, and governance changes.
Key Financial Metrics and Transaction Terms
- Merger Consideration: Holders of Tevogen Bio securities are entitled to receive shares of Semper Paratus Class A common stock with an aggregate value of $1,200,000,000.
- Earnout Provisions: An additional 20,000,000 shares of Semper Paratus Class A common stock may be issued if the VWAP exceeds specific thresholds ($15.00, $17.50, and $20.00) for 20 out of 30 consecutive trading days within 36 months of closing. The Sponsor receives 1,500,000 additional shares for each earnout payment tier.
- Equity Line of Credit: Semper Paratus may seek a private placement of Class A common stock totaling between $35,000,000 and $60,000,000.
- Cash Condition: Closing is conditioned on Semper Paratus having at least $25,000,000 in cash and cash equivalents at closing (including trust account funds after redemptions and expenses).
- Debt Assumption: Semper Paratus will assume all obligations of Tevogen Bio under its Convertible Notes via a note assumption agreement.
Note: This filing does not provide historical revenue, profit, cash flow, or margin data for either company. It focuses on the transaction structure.
Material Changes and Governance
- Corporate Structure: Semper Paratus will migrate from the Cayman Islands to Delaware (Domestication) immediately prior to the merger.
- Board Composition: The post-closing board will consist of seven directors: one designated by Semper Paratus and six by Tevogen Bio (at least four must be independent).
- Executive Leadership: The CEO and CFO of Tevogen Bio will serve as the CEO and CFO of the combined company immediately after closing.
- Termination Rights: The agreement may be terminated if conditions are not met by the "Outside Date" of December 5, 2023, or if Tevogen Bio fails to deliver audited financial statements by July 15, 2023.
Guidance, Risks, and Contingencies
- Conditions to Closing: The transaction is subject to shareholder approval from both companies, SEC effectiveness of the registration statement (Form S-4), NYSE listing approval, and the absence of a Material Adverse Effect.
- Redemption Risk: The transaction is contingent on meeting the $25 million minimum cash requirement after accounting for shareholder redemptions. Excessive redemptions could prevent closing.
- Forward-Looking Risks: Risks include failure to complete the transaction by the business combination deadline, inability to raise additional capital, regulatory hurdles, clinical trial uncertainties for Tevogen Bio, and potential disruption to operations.
- Related Agreements: Final terms for non-competition, lock-up, and registration rights agreements are yet to be negotiated but are conditions to closing.
Investor Verification Checklist
- Verify the final terms of the Equity Line of Credit and whether the $35M-$60M target is achieved.
- Monitor the level of shareholder redemptions to ensure the $25 million minimum cash condition is met.
- Review the upcoming Form S-4 proxy statement for detailed financial data and risk factors not included in this 8-K.
- Confirm the delivery of Tevogen Bio's audited financial statements by the July 15, 2023 deadline.
- Assess the status of regulatory approvals and the NYSE listing application.