Sagaliam Acquisition Corp. (NASDAQ: “SAGAU”, “SAGA”, “SAGAR”)
(“Sagaliam” or the “Company”) announced today that, in connection
with the previously announced special meeting of stockholders to be
held at 9:00 a.m., Eastern Time, on December 22, 2022 (the
“Meeting”) at which meeting stockholders will be asked to vote on a
proposal to amend the Company’s amended and restated certificate of
incorporation (the “Charter”) pursuant to a first amendment to the
Charter to provide the Company with the option to extend the date
by which the Company must complete its initial business combination
from December 23, 2022 by up to ten successive one month periods up
to October 23, 2023 by depositing additional funds into the trust
account at each extension election (the “Extension Amendment
Proposal”), Sagaliam Sponsor LLC (the “Sponsor”) will make
increased contributions to the trust account following the approval
and implementation of the Extension Amendment Proposal.
The Sponsor has agreed that if the Extension
Amendment Proposal is approved, the Sponsor will contribute to the
trust account the lesser of (x) $120,000 and (y) $0.06 per share
for each public share of the Company that is not redeemed in
connection with the Meeting for each one-month extension, paid on a
month-to-month and as-needed basis, (each being referred to herein
as a “Contribution”), to extend the date by which the Company must
complete its initial business combination from December 23, 2022
for an additional one month period each time, for up to ten times,
until October 23, 2023. If the Company extends the time to complete
a business combination to October 23, 2023, the Sponsor would make
aggregate Contributions in the amount of the lesser of (x)
$1,200,000 and (y) $0.60 per share for each public share of the
Company that is not redeemed in connection with the Meeting.
The Sponsor intends to support Sagaliam in the
wake of a new potential excise tax that may be levied on
stockholder redemptions in 2023.
On August 16, 2022, the Inflation Reduction Act
of 2022 (the “IR Act”) was signed into federal law. The IR Act
provides for, among other things, a new U.S. federal 1% excise tax
(the “Excise Tax”) on certain repurchases (including redemptions)
of stock by publicly traded domestic (i.e., U.S.) corporations and
certain domestic subsidiaries of publicly traded foreign
corporations. The excise tax is imposed on the repurchasing
corporation itself, not its stockholders from which shares are
repurchased. The amount of the excise tax is generally 1% of the
fair market value of the shares repurchased at the time of the
repurchase. The IR Act applies only to repurchases that occur after
December 31, 2022.
The extensions authorized by the Extension
Amendment Proposal could result in the closing of Sagaliam’s
recently announced business combination with Allenby Montefiore
Limited after December 31, 2022. Any redemption or other repurchase
that occurs after December 31, 2022, in connection with an initial
business combination or otherwise, may be subject to the excise
tax. Whether and to what extent the Company would be subject to the
excise tax in connection with an initial business combination would
depend on a number of factors, including (i) the fair market value
of the redemptions and repurchases in connection with the initial
business combination, (ii) the structure of the initial business
combination, (iii) the nature and amount of any “PIPE” or other
equity issuances in connection with the initial business
combination (or otherwise issued not in connection with the initial
business combination but issued within the same taxable year of the
initial business combination) and (iv) the content of regulations
and other guidance from the U.S. Department of the Treasury. In
addition, because the excise tax would be payable by the Company,
and not by the redeeming holder, the mechanics of any required
payment of the excise tax have not been determined.
To mitigate the current uncertainty surrounding
the implementation of the IR Act, in the event that the Extension
Amendment Proposal is implemented, the Sponsor intends to indemnify
Sagaliam for any excise tax liabilities resulting from the
implementation of the IR Act with respect to any future redemptions
that occur after December 31, 2022. For the avoidance of doubt, the
proceeds placed in the Company’s trust account and the interest
earned thereon shall not be used to pay for any excise tax due
under the IR Act in connection with any redemptions of the
Company’s Class A common stock prior to or in connection with its
initial business combination.
If stockholders have any questions or need
assistance please call the Company’s proxy solicitor, Morrow Sodali
LLC, at (800) 662-5200 (toll free) or banks and brokers can call
collect at (203) 658-9400, or by e-mailing
saga.info@investor.morrowsodali.combanks.
About Sagaliam Acquisition
Corp.
Sagaliam Acquisition Corp. is a blank check
company incorporated under the laws of the State of Delaware on
March 31, 2021 for the purpose of effecting a merger, capital stock
exchange, asset acquisition, stock purchase, reorganization or
similar business combination with one or more businesses or
entities. On November 16, 2022 Sagaliam entered into a Business
Combination Agreement (the “BCA”) with Allenby Montefiore Limited,
a private company limited by shares organized and existing under
the Laws of the Republic of Cyprus, AEC Merger Sub Corp., a
Delaware corporation, Supraeon Investments Limited, a private
company limited by shares organized and existing under the Laws of
the Republic of Cyprus and GLD Partners, LP, a Delaware limited
partnership. Completion of the business combination is subject to,
among other matters, the satisfaction of the conditions precedent
negotiated in the BCA and the approval of the transaction by
Sagaliam stockholders.
Forward-Looking Statements
This press release includes forward-looking
statements that involve risks and uncertainties. Forward-looking
statements are statements that are not historical facts. Such
forward-looking statements are subject to risks and uncertainties,
which could cause actual results to differ from the forward-looking
statements. These forward-looking statements and factors that may
cause such differences include, without limitation, uncertainties
relating to the Company’s stockholder approval of the Extension
Amendment Proposal, its inability to complete an initial business
combination within the required time period or, and other risks and
uncertainties indicated from time to time in filings with the SEC,
including Sagaliam’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2021 under the heading “Risk Factors” and other
documents Sagaliam has filed, or to be filed, with the SEC. Readers
are cautioned not to place undue reliance upon any forward-looking
statements, which speak only as of the date made. Sagaliam
expressly disclaims any obligations or undertaking to release
publicly any updates or revisions to any forward-looking statements
contained herein to reflect any change in the Company’s
expectations with respect thereto or any change in events,
conditions or circumstances on which any statement is based.
Participants in the
Solicitation
Sagaliam and its directors, executive officers,
other members of management and employees, under SEC rules, may be
deemed to be participants in the solicitation of proxies from the
security holders of Sagaliam in favor of the approval of the
Extension Amendment Proposal. Investors and security holders may
obtain more detailed information regarding the names, affiliations
and interests of Sagaliam’s directors and officers in the
definitive proxy statement dated November 29, 2022 (the “Extension
Proxy Statement”), which, when available, may be obtained free of
charge from the sources indicated above.
No Offer or Solicitation
This press release shall not constitute a
solicitation of a proxy, consent or authorization with respect to
any securities or in respect of the Extension Amendment Proposal.
This communication shall also not constitute an offer to sell or
the solicitation of an offer to buy any securities, nor shall there
be any sale of securities in any states or jurisdictions in which
such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act or an exemption therefrom.
Additional Information and Where to Find
It
Sagaliam urges investors, stockholders and other
interested persons to read the Extension Proxy Statement as well as
other documents filed by Sagaliam with the SEC, because these
documents will contain important information about Sagaliam and the
Extension Amendment Proposal. When available, stockholders may
obtain copies of the Extension Proxy Statement, without charge, at
the SEC’s website at www.sec.gov or by directing a request to:
Sagaliam Acquisition Corp., Barry Kostiner, Chief Executive
Officer, 1800 Avenue of the Stars, Suite 1475, Los Angeles, CA
90067; Tel: (213) 616-0011; bkostiner@fintecham.com.
CONTACT INFORMATION
Sagaliam Acquisition Corp.,Barry Kostiner, Chief Executive
Officer1800 Avenue of the Stars, Suite 1475Los Angeles, CA
90067Tel: (213) 616-0011bkostiner@fintecham.com
Sagaliam Acquisition (NASDAQ:SAGAU)
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