AGBA Acquisition Limited *
PROPOSED BUSINESS COMBINATION: TAG Holdings Limited
ENTERPRISE VALUE: $555 million
ANTICIPATED SYMBOL: AGBA
AGBA Acquisition Limited proposes to combine with TAG Holdings Limited (“TAG”), a British Virgin Islands diversified financial holding company and its wholly-owned subsidiaries, TAG International Limited, a British Virgin Islands business company engaged in business-to-business services (“B2B”), TAG Asset Partners Limited, a wholly-owned subsidiary of B2B (“B2BSub”), OnePlatform International Limited, a wholly-owned subsidiary of B2BSub (“HKSub”), OnePlatform Holdings Limited, a Hong Kong-headquartered company that engages in business-to-business services through its wholly-owned subsidiaries (“OPH”), and TAG Asia Capital Holdings Limited, a British Virgin Islands business company which engages in the financial technology sector through its wholly-owned subsidiaries.
- OnePlatform Holdings Limited (“OPH”) and TAG Asia Capital Holdings Limited (“Fintech”) (collectively “Platform Businesses”) form an integral part of TAG’s wider portfolio of companies.
- Through their wholly-owned subsidiaries, OPH is engaged in business-to-business (or B2B) services and Fintech is engaged in the financial technology or fintech business. The Platform Businesses are wholly owned by TAG Holdings Limited (“TAG”).
SUBSEQUENT EVENT – 11/10/22 – LINK
- On November 9, 2022, AGBA, TAG, Fintech, B2B, B2BSub and HKSub entered into a Forward Share Purchase Agreement (the “Meteora Backstop Agreement”) with Meteora Special Opportunity Fund I, LP, Meteora Select Trading Opportunities Master, LP, and Meteora Capital Partners, LP (collectively, “Meteora”).
- Meteora has agreed to purchase up to 2,500,000 AGBA Ordinary Shares in the open market at prices no higher than the redemption price, including from other AGBA shareholders that elected to redeem and subsequently revoked their prior elections to redeem their shares, following the expiration of AGBA’s redemption offer.
- AGBA has agreed to purchase those shares from Meteora on a forward basis, up to the lesser of
- (i) that number of AGBA shares then held by Meteora, and
- (ii) the difference of
- (x) the number of shares held by Meteora at Closing (which shall be no more than 2,500,000 Ordinary Shares in the aggregate) minus
- (y) that number of shares equal to
- (I) the product of
- (A) $0.12, multiplied by
- (B) the number of shares held by the Meteora at Closing (such product, the “Commitment Share Value”), divided by the VWAP Price for the preceding 30 trading days ending on the day that is 30 days following the Closing (the number of shares derived in (y), the “Commitment Shares”, and the lesser of (1) and (2), the “Puttable Shares”), unless otherwise agreed to in writing by all Parties, at a price per Share equal to the sum of ‘
- (i) the redemption price as contemplated by the Definitive Proxy Statement (the “Redemption Price”), plus
- (ii) $0.45 (the sum of (i) and (ii), the “Base Price”), plus
- (iii) the result of
- (X) the Base Price, multiplied by
- (Y) the number of Commitment Shares, divided by
- (Z) the number of Puttable Shares (such sum of (i), (ii) and (iii), the “Shares Purchase Price”); provided that the Shares Purchase Price will be reduced by $0.15 for the first full calendar quarter after 90 days following the Closing sooner than the Put Date that the Put occurs if the Put does so occur, plus an additional reduction of $0.10 if the Put occurs before 90 days following the Closing.
- (I) the product of
- The purchase price payable by AGBA will be escrowed in the amount of the redemption price per share. At the election of AGBA, $0.45 of the Shares Purchase Price can be paid using Ordinary Shares rather than cash.
- The Meteora Backstop Agreement matures 9 months after the closing of the Business Combination.
- The maturity date may be accelerated by Meteora if
- (i) the Meteora Backstop Agreement is terminated for any reason after the closing of the Business Combination, or
- (ii) during any 30 consecutive trading day period at least 90 days following the Closing of the Business Combination, the the VWAP of the AGBA shares for 10 trading days during such period shall be less than $3.50 per Ordinary Share.
- At maturity, any remaining shares subject to the forward transaction will be purchased by AGBA with the remaining escrowed funds released to Meteora.
- During the term of the transaction, Meteora may elect to sell some or all of the shares subject to the transaction to third parties, after which those shares will no longer be subject to the repurchase by AGBA, and in such event AGBA will receive a portion of the escrowed funds.
- AGBA shall reimburse Meteora for all reasonable and necessary brokerage commissions incurred in connection with Meteora’s acquisition of the shares under the Meteora Backstop Agreement, in an amount not to exceed $0.05 per Share and $0.02 per disposition of each share.
- Furthermore, AGBA will pay Meteora $110,000 in cash at the Closing of the Business Combination.
SUBSEQUENT EVENT – 10/21/22 – LINK
- The Outside Closing Date was extended from October 31, 2022, to December 31, 2022
- Both parties waived the minimum cash closing condition and no requirement for a PIPE
SUBSEQUENT EVENT – 10/6/22 – LINK
- On September 30, 2022, the Audit Committee of the Board of Directors of the Company dismissed Friedman and engaged Marcum to serve as the independent registered public accounting firm of the Company for the year ending December 31, 2022, effective immediately.
SUBSEQUENT EVENT – 8/31/22 – LINK
- On August 29, 2022, the parties entered into a Business Combination Agreement Waiver (the “Waiver”) pursuant to which:
- The parties have mutually agreed to waive the following conditions to Closing:
- (a) filing with the SEC and effectiveness of a registration statement for the Aggregate Stock Consideration
- (b) executed Employment Agreements with any Key Personnel including Mr. Ng Wing Fai and Mr. Shu Pei Huang, Desmond, and
- (c) executed lock-up agreements by each person who will hold 1% or more of Acquiror Ordinary Shares comprising the Aggregate Stock Consideration
- AGBA has agreed to waive the condition to Closing of delivery of duly executed opinions from the Hong Kong and British Virgin Islands counsel of B2B and from the British Virgin Islands counsel of Fintech, addressed to the Acquiror
- As a result of this Waiver, each person who will hold 1% or more of the Acquiror Ordinary Shares comprising the Aggregate Stock Consideration will no longer be required to lock up their shares for at least 180 days from Closing as required under the current Business Combination Agreement.
- The parties have mutually agreed to waive the following conditions to Closing:
EXTENSION 8/12/22 – LINK
- On August 9, 2022, AGBA Acquisition Limited issued an unsecured promissory note in the aggregate principal amount of $504,430.65 to the Sponsor in exchange for the Sponsor depositing such amount into the Company’s trust account in order to extend from August 16, 2022 to November 16, 2022.
- The Note does not bear interest and will mature upon closing of a business combination by the Company.
- In addition, the Note may be converted by the holder into units of the Company identical to the units issued in the Company’s initial public offering at a price of $10.00 per unit.
SUBSEQUENT EVENT – 5/6/22 – LINK
- On May 4, 2022, parties of the Business Combination Agreement agreed to extend the Outside Closing Date to October 31, 2022 from April 30, 2022, and (ii) each party shall use its reasonable best efforts to finalize all Additional Agreements and other ancillary documents contemplated by the Business Combination Agreement no later than September 30, 2022.
EXTENSION – 5/3/22 – LINK
- The SPAC voted to add the option to extend by 3 months on two separate occasions
- For each extension, the sponsor will deposit $0.15/Share for each share not redeemed
- The SPAC contributed $504,430.65 to the trust account. – LINK
- For each extension, the sponsor will deposit $0.15/Share for each share not redeemed
SUBSEQUENT EVENT (8-K LINK)
- On January 4, 2022, the parties, together with AGBA’s newly established wholly-owned subsidiaries, AGBA Merger Sub I Limited and AGBA Merger Sub II Limited, entered into a second amendment of the Business Combination Agreement (the “Second Amendment”). Pursuant to the Second Amendment, the parties have agreed that, among other things, the Outside Closing Date of the proposed transactions contemplated by the Business Combination Agreement shall be extended to April 30, 2022 from January 31, 2022, and that each party shall use its reasonable best efforts to finalize all Additional Agreements and other ancillary documents contemplated by the Business Combination Agreement no later than March 31, 2022.
EXTENSION – 2/8/22 – LINK
- The company announced that it has deposited $546,991.05 (~$0.15/Share) in order to extend the time to complete a business combination for an additional 3 months from February 16, 2022, to May 16, 2022.
EXTENSION – 11/12/21 – LINK
- The company announced that it has deposited $546,991.05 (~$0.15/Share) in order to extend the time to complete a business combination for an additional 3 months from November 16, 2021, to February 16, 2022.
EXTENSION – 8/11/21 – LINK
- The company announced that it has deposited $594,466.50 (~$0.15/Share) in order to extend the time to complete a business combination for an additional 3 months from August 16, 2021, to November 16, 2021.
EXTENSION – 5/12/21 – LINK
- The company announced that it has deposited $594,466.50 (~$0.15/Share) in order to extend the time to complete a business combination for an additional 3 months from May 16, 2021, to August 16, 2021.
TRANSACTION
- The deal gives the Platform Businesses a combined base enterprise value of US$555 million.
- In addition, AGBA and the Platform Businesses will aim to ensure that the post-combination combined company shall receive a sufficient amount to fund its agreed business plans and operations in immediately available cash, net of expenses and liabilities, of at least US$35,000,000 comprised of:
- (i) amounts not redeemed from AGBA’s trust account and
- (ii) amounts raised in private investment in public equity (PIPE).
- In consideration of the Acquisition Merger, AGBA will issue 55,500,000 ordinary shares with a deemed price per share of US$10.00, as directed by TAG, in its capacity as the sole shareholder of B2B and Fintech.
- Upon the completion of the business combination, the parties plan for the combined company to be NASDAQ-listed under AGBA’s current ticker symbol – AGBA.
PIPE
- There is no PIPE for this transaction.
LOCK-UP
- In connection with the closing of the Business Combination, each holder who holds one percent (1%) or more of the Aggregate Stock Consideration (less the Holdback Shares) will enter into a lock-up agreement with Acquiror with a lock-up period of not less than 180 days from the first business day after the closing of the Acquisition Merger.
- Unless otherwise agreed by the Acquiror and Group Parties in writing, form of the lock-up agreement will be agreed between the parties not later than 60 days after the signing of the Business Combination Agreement.
NOTABLE CONDITIONS TO CLOSING
- The post-combination company will have at least $35.0 million, net of expenses and liabilities, in immediately available cash, comprised of:
- (i) amounts not redeemed from Acquiror’s trust account, and
- (ii) amounts raised in the PIPE Investment
NOTABLE CONDITIONS TO TERMINATION
- On May 4, 2022, parties of the Business Combination Agreement agreed to extend the Outside Closing Date to October 31, 2022
- Subsequent Event – Pursuant to the Second Amendment, the parties have agreed that, among other things, the Outside Closing Date of the proposed transactions contemplated by the Business Combination Agreement shall be extended to April 30, 2022.
- The Business Combination Agreement may be terminated and/or abandoned at any time prior to the closing, whether before or after approval of the proposals being presented to the stockholders, by:
- The Acquiror on the one hand, or TAG, B2B and/or Fintech on the other hand, if the closing has not occurred by December 31, 2021.
ADVISORS
- Loeb & Loeb LLP is acting as legal advisor to AGBA
- Dechert LLP is acting as legal advisor to TAG and its subsidiaries.
MANAGEMENT & BOARD
Executive Officers
Gordon Lee, 52
Chief Executive Officer & Director
Mr. Lee has over 27 years of experience in the education, IT, and entertainment industries and with startup businesses. Since June 2015, he has been an advisor of Victoria Educational Organization (“Victoria”). Having seven kindergartens and one nursery school, Victoria is the leading provider in Hong Kong of high quality education for over 3,500 children. Victoria was the first kindergarten to introduce English teachers into the classroom, and to establish a collaborative, co-teaching environment with Chinese and English native speaking teachers working side by side. In February 2016, Mr. Lee founded Causeway Bay CLC, which provides extracurricular activities for Victoria Kindergarten students, such as: STEM (Science, Technology, Engineering and Mathematics) program, soccer and other outdoor/indoor activities. In May 2010 Mr. Lee co-founded Soliton Holdings Limited, one of the first music streaming applications in Hong Kong and Macau. Prior to that, Mr. Lee co-founded and was the Business Development Director of Aspect Gaming from May 2007 to December 2010. Aspect Gaming is a game developer that brings offline games to online platform including lottery, casino and social gaming. ) From October 2001 to February 2007 Mr. Lee served as an Executive General Manager of Mocha Slot Group Limited, a member of Melco PBL Entertainment (Macau) Limited- a NASDAQ listed company. Mocha Club is one largest non-casino based operations of electronic gaming machines in Macau. Prior to Mocha Club, Mr. Lee co-founded Elixir Group Limited (listed in AMEX: EGT), which was established in 2002 as a gaming focused IT solution provider (including a slot machine businesses). Elixir Group Limited operates in 32 countries and generated over 250 million Euros in 2017. Mr. Lee obtained his Bachelor of Science in Computer Science Degree in 1991 and his Master of Science in Computer Science Degree in 1992 from Rensselaer Polytechnic Institute.
Vera Tan, 42
Chief Financial Officer & Director
Ms. Tan has over 18 years of experience in deal origination, direct investments, banking, structured finance, asset management and law. Since 2018, Ms. Tan has been the Managing Director of CMSC Capital Partners, a Hong Kong licensed asset management firm and the Founder and Managing Partner of VAM Advisory Limited, a strategic and management consulting firm. From March 2015 to April 2018, Ms. Tan was the Head of Hong Kong Global Markets Debt Compliance for Deutsche Bank AG, managing a total of eight different business lines across corporate treasury sales, FICC trading, institutional sales, special situations, structured finance, distressed trading, treasury and pool. During the period of March 2011 to October 2014, Ms. Tan co-founded and acted as Managing Director of Client Solutions at Sun Hung Kai Financial, a leading financial services institution in Hong Kong. Ms. Tan’s department at Sun Hung Fai Financial was responsible for structured financing, private equity, co investment and direct investment. From May 2010 to December 2010, Ms. Tan was Director of Fixed Income at Mizuho Asia Securities Limited. Ms. Tan is responsible for creating the Third Party Group under Goldman Sachs Asia LLC Hong Kong Fixed Income, Currencies and Commodities Division. During her time at Goldman Sachs, Ms. Tan was consecutively ranked as a first quartile performer at Goldman. In June 2000, Ms. Tan graduated from University College London with a Bachelor of Law. Ms. Tan continued her studies in September 2000- June 2001 at the Inns of Court School of Law in London and graduated with a Postgraduate Diploma in Professional Legal Skills.
Board of Directors
Brian Chan, 52
Director
Mr. Chan has over 23 years of experience handling litigations for civil claims, intellectual property rights protection and enforcement. Since September 2007 to present, Mr. Chan has been a Senior Partner at Chan, Tang & Kwok Solicitors, a member of the International Trademark Attorneys Association. From September 1995 to August 2007, he was a Consultant at Benny Kong & Peter Tang, Partner at Stevenson, Wong & Co., Solicitors, Associate at Stephenson Harwood & Lo, and Associate at Baker & McKenzie. Additionally, Mr. Chan has acted as a Counsel to various Hong Kong and cross-border mergers and acquisitions and commercial matters since August 1999. Mr. Chan is also a frequent speaker on legal issues for intellectual property rights for the Hong Kong Productivity council, and acts as an Advisor to the Chief Brand Officer Association of Hong Kong (CBOHK). Mr. Chan graduated with a Bachelor of Laws Degree and passed the Solicitors’ Finals of the Law Society of England and Wales in 1993.
Eric Lam, 48
Director
Since January 2007, he has been the Financial Controller of Skyworth Digital Holdings Limited (“Skyworth”), which is one of the world’s top ten color TV brands, and is a leading Chinese brand of the display industry in China. In September 2013, in addition to Financial Controller, Mr. Lam became the Company Secretary of Skyworth. At Skyworth, Mr. Lam participated in multiple acquisitions, including the acquisition of Sinoprima Investments and Manufacturing SA (PTY) Ltd, a home appliance brand in South Africa in 2014; Metz Consumer Electronics GmbH, a German TV company and Strong Media Group Limited, an European set-top box company. Mr. Lam holds a Bachelor of Computing (Information System) and a Bachelor of Business (Accounting) degree from Monash University of Australia.
Thomas Ng, 64
Director
Thomas Ng has 30 years of broad experience engaging in the fields of Education, Media, Retailing Marketing and Finance. He is a pioneer of IT in education and he was the author of “Digital English Lab”, one of the first series of digital books in Hong Kong. Since September 2018, he has been the Chief Executive Officer of e-chat, an IPFS block chain social media focused company. From March 2017 to April 2018, Mr. Ng was the Chief Financial Officer of Duofu Holdings Group Co. Limited. In February 2016, Mr. Ng founded Shang Finance Limited and was the Chief Executive Officer until February 2017. From March 2015 to November 2015, Mr. Ng was the Chief Financial Officer of World Unionpay Group Shares Limited. In August 2003, Mr. Ng established Fuji (Hong Kong) Co. Ltd. and was the Chief Executive Officer until December 2014, Mr. Ng obtained a Certificate of Education majoring in English from the University of Hong Kong in 2000.