Mobiv Acquisition in a regulatory filing said it entered into a non-redemption agreement with certain investors who agreed to withdraw their redemptions and to purchase additional shares from other redeeming investors. The move is part of the SPAC’s effort to close its merger with SRIVARU, which makes electric motorcycles. Mobiv shareholders approved the merger back in September, although closing the deal has presented challenges.
The day before the merger vote, Mobiv said that 5,530,395 Class A shares, representing 97.5% of shares outstanding, were redeemed. Redemptions ahead of an extension vote in July removed nearly $46 million from the Mobiv trust. Those redemptions alone would have lowered the trust to about $41 million.
Following the vote, Mobiv extended its completion date to Nov. 8, but announced today that it would be extended again to Dec. 8. This marks the seventh of nine monthly extensions available to the SPAC.
The investors in the redemption reversal agreement will hold at least 500,000 shares and the SPAC has guaranteed that they will receive no fewer than 20 shares of SRIVARU Holding Limited, in exchange for each SPAC share they hold.
Additionally, SRIVARU entered into a securities purchase agreement and a registration rights agreement with the investors. SRIVARU agreed to sell and issue 4,729,210 SVH shares to the redemption-reversal investors to satisfy the company’s obligations under the NRA with respect to the investors’ exchange of SPAC shares. This is in consideration of the investors’ obligation under the NRA to withdraw their redemptions and to purchase the additional SPAC shares. SRIVARU will issue 5 million of its shares to the investors in the event the volume weighted average price of any five trading days in any consecutive 10 day period is equal to or less than 50 cents, or the shares cease to be listed or quoted for trading immediately following the closing of the merger with Mobiv.
Mobiv last week announced that it will enter into a lock-up waiver with the underwriter of the SPAC’s IPO.
The underwriter would agree to waive certain lock-up restrictions on up to 2,441,250 shares of Class B stock and 543,300 shares of Class A stock held by Mobiv. The goal is to incentivize certain investors to acquire Class A shares currently subject to the exercise of the SPAC’s shareholder redemption rights, with a view toward withdrawing the redemptions. Read more.
