SEC Filing Summary: Chavant Capital Acquisition Corp. (CLAY)
Business Context and Reporting Period
This Form 8-K was filed on June 22, 2022, reporting events occurring on June 20, 2022. The registrant is Chavant Capital Acquisition Corp., a Cayman Islands-based special purpose acquisition company (SPAC) listed on the Nasdaq Stock Exchange. The filing details the entry into a material definitive agreement with its sponsor, Chavant Capital Partners LLC.
Key Financial Metrics
The filing does not provide comprehensive financial statements, revenue, profit, or cash flow data. The primary financial metric disclosed is the issuance of an unsecured convertible promissory note with the following terms:
- Principal Amount: $360,000 issued on June 20, 2022.
- Interest Rate: 0% (non-interest bearing).
- Conversion Terms: Convertible into private placement warrants at $1.00 per warrant upon the consummation of an initial business combination, at the Sponsor's option.
- Aggregate Conversion Cap: Up to $1,500,000 of loans under this note and future notes may be converted.
- Maturity Date: December 31, 2023, or five business days after the closing of an initial business combination, whichever is earlier.
Material Changes and Transaction Details
The Company entered into a new financing arrangement to fund ongoing working capital requirements and to potentially fund a deposit into its Trust Account pending shareholder approval of an Extension Amendment Proposal. Funds not used for the Trust Account deposit will be utilized for working capital. The filing notes that further drawdowns under this note are restricted after July 22, 2022, unless the Company discloses a definitive business combination agreement or obtains shareholder approval to extend its combination deadline.
Outlook, Risks, and Contingencies
Repayment of the note is contingent on the outcome of the Company's search for a business combination:
- If a business combination closes: The Company may repay the loan using proceeds from the Trust Account.
- If a business combination does not close: The Company must repay the loan using working capital held outside the Trust Account; Trust Account proceeds cannot be used for this purpose.
- Extension Risk: The ability to draw additional funds is tied to the July 22, 2022 deadline for shareholder approval of an extension or the signing of a definitive merger agreement.
Investor Verification Checklist
- Verify the status of the Extension Amendment Proposal referenced in the preliminary Proxy Statement filed on June 9, 2022.
- Confirm whether the $360,000 principal was deposited into the Trust Account or retained for working capital.
- Monitor the July 22, 2022 deadline for shareholder approval or the announcement of a definitive business combination agreement.
- Review the full text of the Promissory Note (Exhibit 10.1) for specific covenants and conversion mechanics.