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Feutune Light Acquisition Corporation *

Feutune Light Acquisition Corporation *

Apr 11, 2022 by sam.beattie

PROPOSED BUSINESS COMBINATION: Thunder Power Holdings Limited

ENTERPRISE VALUE: $459 million
ANTICIPATED SYMBOL: TBD

Feutune Light Acquisition Corporation proposes to combine with Thunder Power Holdings Limited.

Thunder Power produces high-quality EVs aiming for a larger market share due to their design, quality, comfort, range, and pricing. They plan to sell four types of EVs in the U.S., Europe, and Asia: Limited Edition Coupe, Compact City Car, Long-range Sedan, and Long-range SUV. Their vehicles boast longer ranges, quicker charging, and lighter weights compared to some competitors, based on their prototype tests. This efficiency leads to reduced ownership costs. Thunder Power’s team is experienced in EV technology and the automotive sector. They’ve collaborated with Italian design firm, Zagato, for prototypes and have ties with European and Chinese suppliers for cost-effective materials. Their unique modular design approach enhances component reuse, reducing costs and improving scalability.

SUBSEQUENT EVENT – 6/13/24 – LINK

  • Forward Purchase Agreement with Meteora
    • Pursuant to the terms of the Forward Purchase Agreement, the Seller intends, but is not obligated, to purchase up to 4,900,000 Shares less the number of FLFV Shares purchased by the Seller separately from third parties through a broker in the open market.
    • The prepayment shortfall in an amount in U.S. dollars equal to 0.25% of the product of the Recycled Shares and the Initial Price.
      • Additionally, following the closing of the Business Combination and up to 45 calendar days prior to the Valuation Date, Counterparty may request additional Prepayment Shortfall from Seller in tranches of $500,000.
    • The Seller in its sole discretion may sell Recycled Shares at any time following the Trade Date and at any sales price, without payment by the Seller of any Early Termination Obligation until such time as the proceeds from such sales equal 110% of the Prepayment Shortfall.
    • Within 45 days of June 11, 2024, the Counterparty will file a registration statement at its own cost with the SEC, covering the resale of all shares held by the Seller, including Recycled Shares and Share Consideration Shares, as specified in the Forward Purchase Agreement. The registration statement will be made effective as soon as possible after filing.
    • The reset price (the “Reset Price”) will initially be $10.00.
    • The “Valuation Date” is the earliest of the following: (a) 36 months after the Closing Date, (b) a date chosen by the Seller, provided through written notice to the Counterparty after specific events like a Registration Failure or Delisting Event, and (c) a date specified by the Seller through another written notice at their discretion.
      • The chosen Valuation Date will not be before the notice is effective, and such notices become effective immediately upon delivery as per the Forward Purchase Agreement.
    • The “Settlement Amount Adjustment” is the cash amount equal to the product of (i) the Maximum Number of Shares as of the Valuation Date multiplied by (ii) $2.00.
    • The Counterparty has agreed to grant the Seller, for the period beginning on June 11, 2024 and ending on the 12-month anniversary of the Valuation Date, the right, but not the obligation, in its sole discretion, to invest on the terms offered to the Seller by the Counterparty up to 50% of any future debt, equity, derivative or any other kind of financing of the Counterparty, as legally permitted (each a “Covered Financing”).
      • The Seller will be provided at least ten (10) business day notice to invest in any Covered Financing.
      • Covered Financings does not include any equity line of credit.
  • Subscription Agreement
    • Pursuant to the FPA Funding PIPE Subscription Agreement, Seller agreed to subscribe for and purchase, and FLFV agreed to issue and sell to Seller, prior to the Valuation Date, an aggregate of up to 4,900,000 FLFV Shares, less the Recycled Shares in connection with the Forward Purchase Agreement, at the Initial Price per share.
      • On the Closing Date, all outstanding FLFV Shares (including shares issued pursuant to the Subscription Agreement) will be exchanged for newly issued PubCo Shares in accordance with the terms of the Merger Agreement.

EXTENSION – 3/20/24 – LINK

  • The SPAC approved the extension from March 21, 2024 to December 21, 2024.
    • 2,378,699 shares were redeemed.
    • $60K per month will be deposited into the trust account.

TRANSACTION

  • At the effective time of the Merger, shareholders of Thunder Power immediately prior to the effective time will receive shares of common stock of Feutune Light based on an implied pro forma enterprise value of approximately $400 million, at a price of $10.00 per share.
    • 20,000,000 shares of common stock of Feutune Light are to be set aside in escrow as earnout shares at the closing of the Transaction, subject to the vesting schedule set forth in the business combination agreement.
  • Thunder Power expects to have up to $53 million in cash on its balance sheet (assuming no redemptions by Feutune Light’s stockholders and before payment of Transaction expenses and deferred underwriting fees).
  • In the intermediate to longer term, the Transaction is expected to positively impact the Company’s operating results, providing funding for further technological advancements and the commercialization of its four EV models.
  • The Transaction, which has been approved by the Board of Directors of Thunder Power and the Board of Directors of Feutune Light, is expected to close in 2024.

SPAC FUNDING – AMENDED 6/13/24

  • Forward Purchase Agreement with Meteora
    • Pursuant to the terms of the Forward Purchase Agreement, the Seller intends, but is not obligated, to purchase up to 4,900,000 Shares less the number of FLFV Shares purchased by the Seller separately from third parties through a broker in the open market.
    • The prepayment shortfall in an amount in U.S. dollars equal to 0.25% of the product of the Recycled Shares and the Initial Price.
      • Additionally, following the closing of the Business Combination and up to 45 calendar days prior to the Valuation Date, Counterparty may request additional Prepayment Shortfall from Seller in tranches of $500,000.
    • The Seller in its sole discretion may sell Recycled Shares at any time following the Trade Date and at any sales price, without payment by the Seller of any Early Termination Obligation until such time as the proceeds from such sales equal 110% of the Prepayment Shortfall.
    • Within 45 days of June 11, 2024, the Counterparty will file a registration statement at its own cost with the SEC, covering the resale of all shares held by the Seller, including Recycled Shares and Share Consideration Shares, as specified in the Forward Purchase Agreement. The registration statement will be made effective as soon as possible after filing.
    • The reset price (the “Reset Price”) will initially be $10.00.
    • The “Valuation Date” is the earliest of the following: (a) 36 months after the Closing Date, (b) a date chosen by the Seller, provided through written notice to the Counterparty after specific events like a Registration Failure or Delisting Event, and (c) a date specified by the Seller through another written notice at their discretion.
      • The chosen Valuation Date will not be before the notice is effective, and such notices become effective immediately upon delivery as per the Forward Purchase Agreement.
    • The “Settlement Amount Adjustment” is the cash amount equal to the product of (i) the Maximum Number of Shares as of the Valuation Date multiplied by (ii) $2.00.
    • The Counterparty has agreed to grant the Seller, for the period beginning on June 11, 2024 and ending on the 12-month anniversary of the Valuation Date, the right, but not the obligation, in its sole discretion, to invest on the terms offered to the Seller by the Counterparty up to 50% of any future debt, equity, derivative or any other kind of financing of the Counterparty, as legally permitted (each a “Covered Financing”).
      • The Seller will be provided at least ten (10) business day notice to invest in any Covered Financing.
      • Covered Financings does not include any equity line of credit.
  • Subscription Agreement
    • Pursuant to the FPA Funding PIPE Subscription Agreement, Seller agreed to subscribe for and purchase, and FLFV agreed to issue and sell to Seller, prior to the Valuation Date, an aggregate of up to 4,900,000 FLFV Shares, less the Recycled Shares in connection with the Forward Purchase Agreement, at the Initial Price per share.
      • On the Closing Date, all outstanding FLFV Shares (including shares issued pursuant to the Subscription Agreement) will be exchanged for newly issued PubCo Shares in accordance with the terms of the Merger Agreement.

EARNOUT

  • Company
    • 20 million earnout shares will be released based on the following terms:
      • 5 million Earnout Shares will be vested if PubCo’s sales/revenues for any fiscal year (referred to as “Tranche 1 Fiscal Year”) from December 31, 2023, to December 31, 2025, reach at least $42.2 million.
      • 15 million Earnout Shares will be vested if PubCo’s sales/revenues for any fiscal year (referred to as “Tranche 2 Fiscal Year”) from December 31, 2023, to December 31, 2026, reach at least $415.0 million.

LOCK-UP

  • Company
    • 6 months from the Closing Date
  • Sponsor
    • 6 months from the Closing Date or if the share price equals $12.50 for 20/30 trading days

NOTABLE CONDITIONS TO CLOSING

  • Available Closing Cash will be no less than $5,000,000.

NOTABLE CONDITIONS TO TERMINATION

  • By either the Company or any Parent Party on or after March 21, 2024 or such later date as agreed to by the parties.

Termination Fee

  • If the Company ends the Merger Agreement, FLFV pays a $500,000 termination fee to the Company within 5 business days.
  • If FLFV ends the Merger Agreement, the Company pays FLFV a $500,000 termination fee within 5 business days.

ADVISORS

  • Company
    • Brown Rudnick LLP is representing Thunder Power as U.S. legal counsel.
    • ARC Group Limited is acting as sole financial advisor to Thunder Power.
  • SPAC
    • Robinson & Cole LLP is representing Feutune Light as U.S. legal counsel.
    • EF Hutton served as capital market advisors to FLFV.
    • US Tiger Securities is acting as financial advisor to Feutune Light.

EXTENSION – 6/20/23 – LINK

  • The SPAC approved the extension from June 21, 2023 to March 21, 2024.
    • 4,791,507 shares were redeemed for $10.49 per share.
    • $100K per month will be deposited into the trust account.

EXTENSION – 3/20/23 – LINK

  • The SPAC approved its auto extension from March 21, 2023 until June 21, 2023
    • $977,500 was deposited into the trust account

MANAGEMENT & BOARD

Executive Officers

Xuedong (Tony) Tian, 50
Chief Executive Officer & Director Nominee

Mr. Tian has been our Chief Executive Officer since March 2022. Furthermore, Mr. Tian has served as Managing Director and Head of Capital Markets at US Tiger Securities, Inc. since October 2020. From May 2012 to October 2020, Mr. Tian was the Founder and President of Weitian Group LLC, a corporate advisory and investor relations consultancy. Prior to that, Mr. Tian was a sell-side equity analyst at various investment banks, including as Managing Director covering China at Merriman Capital, Inc. from June 2013 to January 2016; Executive Director and Lead Analyst covering China Industrials and IT Outsourcing at Oppenheimer & Co. Inc. from May 2011 to May 2012; Vice President and Lead China Analyst at Ladenburg Thalmann & Co. Inc. from May 2010 to April 2011; Senior Associate covering Networking, Hardware & IT Supply Chain at Ticonderoga Securities LLC from October 2009 to May 2010; and Associate covering Semiconductor & Semiconductor Capital Equipment at Pacific Crest Securities LLC (now part of KeyBanc) from April 2008 to September 2009. Prior his Wall Street career, Mr. Tian also worked for Virgin Mobile USA as a Finance Manager – Customer Analytics from June 2006 to March 2008 and for AT&T as a Finance Manager from January 2001 to March 2006. Mr. Tian holds an MBA degree from New York University, a M.A. degree in Economics from the University of Connecticut and a M.S. and B.S. degrees in Land Resources and Management from China Agricultural University. Mr. Tian is a CFA charter holder and currently holds Series 7, 24, 63, and 79 licens

Yuanmei Ma, 50
Chief Financial Officer

Yuanmei Ma has been our Chief Financial Officer shortly since our inception. Ms. Ma has served as the Chief Financial Officer of Mayrock Automotive Inc., a zero-emission commercial mobility company in California since September 2020. Ms. Ma was the director of investor relation at Highpower International Inc., from August 2016 to November 2019; when it was listed on Nasdaq (Formerly Nasdaq: HPJ). From July 2010 to June 2013, Ms. Ma was the Chief Financial Officer for Baosheng Steel Inc. She was Chief Financial Officer of Yihe Pharmaceutical Company Ltd. between August 2009 to June 2010; and Chief Financial Officer of Zhongpin Inc., (Formerly Nasdaq: HOGS), from September 2005 to October 2008. Ms. Ma holds an Executive MBA degree from both INSEAD Business School and Tsinghua University and a Bachelor’s degree in Accounting from Arkansas State University.

Board of Directors

Lei Xu, 45
Chairwoman & President

Dr. Xu has been our Director and President shortly since our inception. Dr. Xu has served as the Executive President of Boya Foundation, a non-profit educational charity organization since July 2019. She has served as the Chairwoman of Peking University Alumni Association of Southern California (PUAASC) since January 2020. From January 2016 to December 2019, she served as the President and Director of PUAASC. Since December 2018, Dr. Xu has served as a limited partner at Seraph Group, an established global investment firm investing in early-stage companies in strategic high-growth sectors such as transportation, aerospace, digital media, sensors, social connectivity, advanced medical devices, health science, data analytics, smart mobility, and ecommerce efficiency. Dr. Xu has been a professor in the Department of Geography & the Environment at California State University – Fullerton since August 2006. She received her Ph.D. and M.A. degrees in Geography from McMaster University, and Bachelor’s degree from Peking University with a major in Urban and Environmental Sciences and a minor in Economics.

Kevin Vassily, 55
Director Nominee

Mr. Vassily has extensive working experience as a senior management team member serving private and public companies. In January 2021, he was appointed Chief Financial Officer, and in March 2021, became a member of the board of directors of iPower Inc. (Nasdaq: IPW), a leading online hydroponic equipment retailer and supplier. Prior to joining iPower, from 2019 to January 2021, Mr. Vassily served as Vice President of Market Development for Facteus, a financial analytics company focused on the Asset Management industry. From March 2019 through 2020, he served as an advisor at Woodseer, a financial technology firm providing global dividend forecasts. From Oct 2018 through its acquisition in 2020, Mr. Vassily served as an advisor at Go Capture, where he was responsible for providing strategic, business development, and product development advisory services for the company’s emerging “Data as a Service” platform. Since February 2020, Mr. Vassily has served as a director of Zhongchao Inc. (Nasdaq: ZCMD), a provider of healthcare information, education and training services to healthcare professionals and the public in China. Since July 2018, Mr. Vassily has also served as an advisor at Prometheus Fund, a Shanghai- based merchant bank/PE firm focused on the “green” economy. And from 2015 through 2018, Mr. Vassily served as an associate director of research at Keybanc Capital Markets, and helped to co-manage the Technology Research vertical. From 2010 to 2014, he served as the director of research at Pacific Epoch (a wholly owned subsidiary of Pacific Crest Securities), where he was responsible for a complete overhaul of product and a complete business model restart post acquisition, re focusing the firm around a “data-first” research offering. From 2007 to 2010, he served as the Asia Technology business development representative and as a senior analyst at Pacific Crest Securities, responsible for establishing the firm’s presence and relevance covering Asia Technology. From 2003 to 2006, he served as senior research analyst in the semiconductor technology group at Susquehanna International Group, responsible for research in semiconductor and related technologies. From 2001 to 2003, Mr. Vassily served as the vice president and senior research analyst for semiconductor capital equipment at Thomas Weisel Partners, responsible for publishing research and maintaining financial models on each of the companies under coverage. Mr. Vassily began his career on Wall Street in 1998, as a research associate covering the semiconductor industry at Lehman Brothers. He holds a B.A. in liberal arts from Denison University and an M.B.A. from the Tuck School of Business at Dartmouth College. Mr. Vassily is a member of the board of directors of Fortune Joy International Acquisition Corporation, a special purpose acquisition company incorporated in August 2021 which is currently seeking Nasdaq listing, and a member of the board of directors of Denali Acquisition Corporation, a special purpose acquisition company listed on Nasdaq.

David Ping Li, 56
Director Nominee

Mr. Li has more than 25 years of experience in the finance and investment industries. Mr. Li is Vice President of International Finance at AGBO Films and Anthem & Song Picture (both co-founded by the Russo brothers, who directed Avengers: Infinity War, Avengers: End Game, Captain America: The Winter Soldier and Captain America: Civil War) since 2015. He was responsible for corporate financing and film collaboration including the origination and closing over $100M equity financing. He also led the collaboration on Chinese language films including Wolf Warriors 2 which held the highest box office record in China. Before that, Mr. Li was managing director of Strategic Investment, Open Innovation at Phillips from 2012 to 2014, where he mainly engaged in strategic investments and acquisition to cultivate and the integration of new businesses into the company post investment. Mr. Li was investment director at Intel Capital, the investment division of Intel Corporation from 2008 to 2011 with focus on TMT investments. From 2004 to 2008, Mr. Li served as managing director at ChinaVest, a venture capital firm responsible for identifying, evaluating and executing investments to achieve financial returns. From February 2002 to July 2003, Mr. Li served as CFO of Great Wall Technology Co. Ltd., a publicly traded diversified technology company. Mr. Li was senior associate in the Investment Banking Division of Donaldson, Lufkin & Jenrette (acquired by Credit Suisse First Boston) from 1998 to 2001 where he executed corporate finance transactions including financial advisory services, IPO, debt financing and mergers & acquisition. From 2008 to 2019, Mr. Li served as independent director and chairman of the audit committee of Highpower International, Inc., a lithium battery company listed on NASDAQ (stock ticker: HPJ) and he assisted to handle and complete the privatization process in 2019. Mr. Li graduated from Beijing University with a Bachelor of Arts degree in Biochemistry. He received a Master’s degree in Molecular Biology from Columbia University and an MBA in finance from the Wharton School of University of Pennsylvania.

Wenbing Chris Wang [Appointed on 10/2/23]
Independent Director 

Mr. Wang has extensive experience as a senior management team member serving private and public companies. Since June 2021, Mr. Wang has served as Chief Financial Officer of Phoenix Motor Inc. (Nasdaq: PEV, “PEV”). Mr. Wang was the senior vice president of finance of SPI Energy Co., Ltd (Nasdaq: SPI) and interim CFO of PEV from November 2020 to June 2021. Prior to joining SPI, Mr. Wang served as Chief Executive Officer of Redwood Group International, a Hong Kong-based merchant bank focused on Greater- China growth and venture opportunities, from February 2017 to November 2020, and a partner with SAIF Xinhuihuang Asset Management Co., Ltd. from December 2018 to March 2020. Prior to that, Mr. Wang served as President of Fushi Copperweld, Inc. (previously NasdaqGS: FSIN) from 2009 to 2016 and its Chief Financial Officer from 2005 to 2010. At Fushi Copperweld, Mr. Wang led the company’s public listing on the Nasdaq and the acquisition of Copperweld Bimetallics in 2007, $290 million in total equity and debt financing from 2005 to 2012, and its $345 million privatization transaction in 2012. Prior to that, Mr. Wang worked for Cornerstone China Opportunities Fund, Redwood Capital, Credit Suisse, VCChina from 1999 to 2005 with progressive responsibilities. Mr. Wang obtained a BSc from the University of Science and Technology Beijing and an MBA degree in Finance and Corporate Accounting from the University of Rochester. Mr. Wang is currently a board member of IT Tech Packaging, Inc. (NYSE/Amex: ITP) starting from October 2009.

Michael Davidov, 46 [Resigned on 10/2/23]
Director Nominee

Mr. Davidov has more than 20 years of experience in the fields of investments and corporate finance. Since 2020, Mr. Davidov served as an independent consultant. In 2012, he co-founded and served as the chief investment officer at Middle Kingdom Value Fund and Global Value Partners, special situations fund on China related and global value investments. From 2018 to 2019, Mr. Davidov served as the audit committee chairman for Nutriband (Nasdaq:NTRB). From April 2006 to July 2009, Mr. Davidov was part of the management team of Middle Kingdom Alliance Corp., a U.S. listed special purpose acquisition company that completed its merger with Pypo China Holdings (a Beijing-based cell phone distribution company) and later changed its name to Funtalk China Holdings Limited (Formerly Nasdaq: FTLK). From January 1999 to December 2009, Mr. Davidov was the director of corporate finance and portfolio manager at High Capital Funding, LLC/Generation Capital, a private equity/special situations fund, where he structured and made private investment in public entity (PIPE) investments as a principal. Mr. Davidov received his Bachelor’s degree in Mathematics from Southern Illinois University and an MBA degree in finance from J. Mack Robinson School of Business at Georgia State University. Mr. Davidov is also a director of Fortune Rise Acquisition Corporation, a special purpose acquisition company listed on Nasdaq, a director of TradeUP Global, a special purpose acquisition company listed on Nasdaq, and a director nominee of TradeUP 88, a special purpose acquisition company to be listed on Nasdaq.

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