Item 1.02. Termination of a Material Definitive Agreement.
As previously disclosed, on November 14, 2021, CHP Merger Corp., a Delaware
corporation ("CHP" or the "Company"), entered into a business combination, by
and among CHP, Accelerate Merger Sub, Inc., a wholly owned subsidiary of CHP
("Merger Sub"), and Integrity Implants Inc. d/b/a Accelus ("Accelus") (as
amended on November 30, 2021 and December 23, 2021, as reported in CHP's Current
Reports on Form 8-K filed with the U.S. Securities and Exchange Commission
("SEC") on December 6, 2021 and December 30, 2021, respectively, and as it may
be further amended and/or restated from time to time, the "Business Combination
Agreement").
Termination of Business Combination Agreement
On April 15, 2022, the Company, Merger Sub and Accelus entered into a
Termination Agreement (the "Termination Agreement"), pursuant to which the
parties agreed to mutually terminate the Business Combination Agreement. The
termination of the Business Combination Agreement is effective as of April 15,
2022. Pursuant to the Termination Agreement, Accelus has agreed to pay the
Company an aggregate of $3.5 million if, and only if, Accelus issues and sells
(or receives binding commitments to purchase) shares of its preferred stock in
exchange for aggregate gross proceeds actually received of at least $12 million
(excluding amounts deemed received upon conversion of any convertible
securities, and excluding any indebtedness) by May 2, 2022.
As a result of the termination of the Business Combination Agreement, the
Business Combination Agreement and all Ancillary Agreements (as defined in the
Business Combination Agreement) entered into in connection therewith are void
and there is no liability under the Business Combination Agreement or any
Ancillary Agreement on the part of any party thereto, except as set forth in the
Termination Agreement, including, but not limited to, under the Sponsor Letter
Agreement, dated November 14, 2021, as amended and restated on November 30,
2021, by and among CHP Acquisition Holdings, LLC, CHP and Accelus. Pursuant to
the Termination Agreement, subject to certain exceptions, the Company and
Accelus have also agreed, on behalf of themselves and their respective related
parties, to a release of claims relating to the transactions contemplated under
the Business Combination Agreement.
Accordingly, because the Company will not be able to complete a business
combination by May 26, 2022, pursuant to the Company's amended and restated
certificate of incorporation, the Company has determined to, as soon as
practicable, liquidate and distribute to the holders of common stock issued in
its initial public offering their pro-rata portion of the funds held in the
trust account established for the benefit of such stockholders, which will be an
amount equal to the aggregate amount on deposit in the trust account, including
any amounts representing interest earned on the trust account then held therein,
less any interest to be released to the Company to pay its franchise and income
taxes (less up to $100,000 of such net interest to pay dissolution expenses).
The Company's warrants will expire with no value. As provided for in the
Company's Current Report on Form 8-K filed with the SEC on November 22, 2021,
the Company will not fund a monthly contribution into the trust account on
April 26, 2022.
The foregoing descriptions of the Business Combination Agreement and the
Termination Agreement do not purport to be complete and are qualified in their
entirety by the terms and conditions of the full text of the Business
Combination Agreement, which was previously filed as Exhibit 2.1 to the
Company's Current Report on Form 8-K, filed with the SEC on November 18, 2021,
and the full text of the Termination Agreement, which is attached hereto as
Exhibit 10.1, each of which is incorporated by reference herein.
Item 8.01. Other Events.
On April 15, 2022, the Company and Accelus issued a joint press release
announcing the termination of the Business Combination Agreement. A copy of the
press release is attached hereto as Exhibit 99.1 and is incorporated herein by
reference.
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit
No. Description
10.1 Termination Agreement, dated April 15, 2022, by and among CHP Merger
Corp., Accelerate Merger Sub, Inc. and Integrity Implants Inc. d/b/a
Accelus
99.1 Press Release, dated April 15, 2022
104 Cover Page Interactive Data File (formatted as Inline XBRL)
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