Item 1.01 Entry into a Material Definitive Agreement
Purchase Agreement
On December 28, 2022 (the "Effective Date"), Kernel Group Holdings Inc., a
Cayman Island exempted company (the "Company"), entered into a Purchase
Agreement (the "Agreement") with Kernel Capital Holdings, LLC, a Delaware
limited liability company ("Original Sponsor"), and VKSS Capital, LLC, a
Delaware corporation (the "New Sponsor"), pursuant to which the New Sponsor, or
an entity designated by the New Sponsor, will purchase from the Original Sponsor
7,187,500 Class B ordinary shares of the Company (the "Class B Shares"), par
value $0.0001 per share and 8,750,000 Private Placement Warrants, each of which
is exercisable to purchase one Class A ordinary share of the Company, par value
$0.0001 per share, for an aggregate purchase price of $1.00 (the "Purchase
Price") payable at the time the Company effects a merger, share exchange, asset
acquisition, share purchase, recapitalization, reorganization or similar
business combination with one or more businesses or entities (the "Initial
Business Combination").
Upon the closing of the Initial Business Combination, New Sponsor shall also
convey 2,000,000 (two million) Class B Shares to the equityholders of the
Original Sponsor, as of the Effective Date (the "Original Sponsor
Equityholders"), pro rata based on the Original Sponsor Equityholders'
underlying interest in the Company's Class B Shares as of the Effective Date.
In addition to the payment of the Purchase Price, the New Sponsor also assumed
the following obligations: (i) responsibility for all of Company's public
company reporting obligations; (ii) all other obligations of the Original
Sponsor related to the Company; (iii) shall settle the outstanding obligations
set forth on Exhibit A of the Purchase Agreement with the parties named therein,
subject to update by Mark Gross, Rakesh Tondon, Brett Northart and Mike Newbold
(the "Initial Sponsor Founders") two (2) business days prior to the closing of
the Initial Business Combination; and (iv) pay each of the Initial Sponsor
Founders $250,000 and convey to each of the Initial Sponsor Founders 125,000
(one hundred twenty five thousand) Class B shares, as an advisor fee ("Advisor
Fee").
Pursuant to the Agreement, the New Sponsor has replaced the Company's current
directors and officers with directors and officers of the Company selected in
its sole discretion.
The Agreement contains customary representations and warranties of the parties,
including, among others, with respect to corporate organization, corporate
authority, and compliance with applicable laws. The representations and
warranties of each party set forth in the Agreement were made solely for the
benefit of the other parties to the Agreement, and investors are not third-party
beneficiaries of the Purchase Agreement. In addition, such representations and
warranties (a) are subject to materiality and other qualifications contained in
the Agreement, which may differ from what may be viewed as material by
investors, (b) were made only as of the date of the Agreement or such other date
as is specified in the Agreement and (c) may have been included in the Agreement
for the purpose of allocating risk between the parties rather than establishing
matters as facts. Accordingly, the Agreement is included with this filing only
to provide investors with information regarding the terms of the Agreement, and
not to provide investors with any other factual information regarding any of the
parties or their respective businesses.
The foregoing description of the Agreement is not complete and is qualified in
its entirety by reference to the text of such document, which is filed as
Exhibit 10.1 hereto and which is incorporated herein by reference.
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Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
The disclosures set forth in Item 1.01 are incorporated by reference into this
Item 5.02.
Change in Company Officers and Directors
On December 28, 2022, Mark Gross, Brett Northart, Chris Farrell, Dee Dee Sklar,
and Ron Meyer tendered their resignations as directors of the Company. Mark
Gross, Rakesh Tondon, Brett Northart, and Mike Newbold resigned as officers of
the Company. Suren Ajjarapu, Howard Doss, Michael Peterson, Donald Fell,
Venkatesh Srinivas, and Siva Srinivasan were appointed as members of the board
of directors of the Company. Suren Ajjarpu was appointed Chief Executive Officer
and Chairman and Howard Doss was appointed as Chief Financial Officer of the
Company. There was no known disagreement with any of our outgoing directors on
any matter relating to the Company's operations, policies or practices.
The following sets forth certain information concerning each new director and
officer's past employment history, directorships held in public companies, if
any, and for directors, their qualifications for service on the Company's board.
Our board of directors is divided into three classes, with only one class of
directors being elected in each year, and with each class (except for those
directors appointed prior to our first annual meeting of shareholders) serving a
three-year term. Our officers are appointed by the board of directors and serve
at the discretion of the board of directors, rather than for specific terms of
office.
Surendra Ajjarapu
Mr. Ajjarapu has served as Chairman of the Board, Chief Executive Officer and
Secretary of Trxade Group, Inc., (NASDAQ: MEDS) a Delaware corporation, and its
predecessor company since July 2010 and is a director of Oceantech Acquisition I
Corp., traded on Nasdaq under the symbol "OTECU." Mr. Ajjarapu has also served
as Chief Executive Officer and Chairman of Aesther Healthcare Acquisition Corp.
since 2021. Since March 2018, Mr. Ajjarapu has served as Executive Chairman of
the Board of Kano Energy Corp., a company involved in the development of
renewable natural gas sites in the United States. Mr. Ajjarapu was a Founder and
served as Chief Executive Officer and Chairman of the Board of Sansur Renewable
Energy, Inc., a company involved in developing wind power sites in the Midwest
of the United States, from March 2009 to December 2012. Mr. Ajjarapu was also a
Founder, President and Director of Aemetis, Inc., a biofuels company (NASDAQ:
AMTX), and a Founder, Chairman and Chief Executive Officer of International
Biofuels, a subsidiary of Aemetis, Inc., from January 2006 to March 2009. Mr.
Ajjarapu was Co-Founder, Chief Operations Officer, and Director of Global
Information Technology, Inc., an IT outsourcing and systems design company,
headquartered in Tampa, Florida with major operations in India. Mr. Ajjarapu
graduated from South Dakota State University with a M.S. in Environmental
Engineering, and from the University of South Florida with an M.B.A.,
specializing in International Finance and Management. Mr. Ajjarapu is also a
graduate of the Venture Capital and Private Equity program at Harvard
University.
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Howard Doss
Mr. Howard A. Doss, is a seasoned chief financial officer and accountant. He has
served as Chief Financial Officer of Aesther Healthcare Acquisition Corp. since
2021. He has also served as chief financial officer of TRxADE HEALTH, INC., an
online marketplace for health traded on Nasdaq under the symbol "MEDS." Mr. Doss
has served in a variety of capacities with accounting and investment firms. He
joined the staff of Seidman & Seidman (BDO Seidman, Dallas) in 1977 and, in
1980, he joined the investment firm Van Kampen Investments, opening the firm's
southeast office in Tampa, Florida in 1982. He remained with the firm until 1996
when he joined Franklin Templeton to develop corporate retirement plan
distribution. After working for the Principal Financial Group office in Tampa,
Florida, Mr. Doss was City Executive for U.S. Trust in Sarasota, Florida,
responsible for high net worth individuals. He retired from that position in
2009. He served as CFO and Director for Sansur Renewable Energy an alternative
energy development company, from 2010 to 2012. Mr. Doss has also served as
President of STARadio Corp. since 2005. Mr. Doss is a member of the America
Institute of CPA's. He is a graduate of Illinois Wesleyan University.
Michael Peterson
Mr. Peterson commenced serving as President, Chief Executive Officer and as a
member of the Board of Directors of Lafayette Energy Corp. in April 2022. Since
September 2021 Mr. Peterson has served as a member of the Board of Directors,
Audit Committee (Chair), Compensation Committee and Nominating and Corporate
Governance Committee of Aesther Healthcare Acquisition Corp. (Nasdaq:AEHA), a
special purpose acquisition company which has entered into a merger agreement to
acquire a biopharmaceutical company and is expected to serve as an independent
director of the merged company. Mr. Peterson has served as the president of Nevo
Motors, Inc. since December 2020, which was established to commercialize a range
extender generator technology for the heavy-duty electric vehicle market but is
currently non-operational. Since May 2022, Mr. Peterson has served as a member
of the Board of Directors and as the Chairperson of the Audit Committee of Trio
Petroleum Corp., an oil and gas exploration and development company which is in
the process of going public, since February 2021, Mr. Peterson has served on the
board of directors and as the Chairman of the Audit Committee of Indonesia
Energy Corporation Limited (NYSE American: INDO). Mr. Peterson previously served
as the president of the Taipei Taiwan Mission of The Church of Jesus Christ of
Latter-day Saints, in Taipei, Taiwan from June 2018 to June 2021. Mr. Peterson
served as an independent member of the Board of Directors of TRxADE HEALTH, Inc.
(formerly Trxade Group, Inc.) from August 2016 to May 2021 (Nasdaq:MEDS). Mr.
Peterson served as the Chief Executive Officer of PEDEVCO Corp. (NYSE
American:PED), a public company engaged primarily in the acquisition,
exploration, development and production of oil and natural gas shale plays in
the US from May 2016 to May 2018. Mr. Peterson served as Chief Financial Officer
of PEDEVCO between July 2012 and May 2016, and as Executive Vice President of
Pacific Energy Development (PEDEVCO's predecessor) from July 2012 to October
2014, and as PEDEVCO's President from October 2014 to May 2018. Mr. Peterson
joined Pacific Energy Development as its Executive Vice President in September
2011, assumed the additional office of Chief Financial Officer in June 2012, and
served as a member of its board of directors from July 2012 to September 2013.
Mr. Peterson formerly served as Interim President and CEO (from June 2009 to
December 2011) and as director (from May 2008 to December 2011) of Pacific
Energy Development, as a director (from May 2006 to July 2012) of Aemetis, Inc.
(formerly AE Biofuels Inc.), a Cupertino, California-based global advanced
biofuels and renewable commodity chemicals company (NASDAQ:AMTX), and as
Chairman and Chief Executive Officer of Nevo Energy, Inc. (NEVE) (formerly
Solargen Energy, Inc.), a Cupertino, California-based developer of utility-scale
solar farms which he helped form in December 2008 (from December 2008 to July
2012). From 2005 to 2006, Mr. Peterson served as a managing partner of American
Institutional Partners, a venture investment fund based in Salt Lake City. From
2000 to 2004, he served as a First Vice President at Merrill Lynch, where he
helped establish a new private client services division to work exclusively with
high-net-worth investors. From September 1989 to January 2000, Mr. Peterson was
employed by Goldman Sachs & Co. in a variety of positions and roles, including
as a Vice President. Mr. Peterson received his MBA at the Marriott School of
Management and a BS in statistics/computer science from Brigham Young
University.
Donald Fell
Mr. Donald G. Fell, brings along a wealth of experience in the field of
economics and business to the Company. Mr. Fell has served as an independent
director of Aesther Healthcare Acquisition Corp. since 2021 and TRxADE HEALTH,
INC since January 2014, as well as a director of Trxade Nevada since December
2013. He is presently Professor and Institute Director for the Davis,
California-based Foundation for Teaching Economics and adjunct professor of
economics for the University of Colorado, Colorado Springs. Mr. Fell held
positions with the University of South Florida as a member of the Executive MBA
faculty, Director of Executive and Professional Education and Senior Fellow of
the Public Policy Institute from 1995 to 2012. Mr. Fell was also a visiting
professor at the University of LaRochelle, France, and an adjunct professor of
economics at both Illinois State University and The Ohio State University. Mr.
Fell holds undergraduate and graduate degrees in economics from Indiana State
University and is all but dissertation (ABD) in economics from Illinois State
University. Through his work with the Foundation for Teaching Economics and the
University of Colorado, Colorado Springs he has overseen graduate institutes on
economic policy and environmental economics in 44 states, throughout Canada, the
Islands and Eastern Europe.
Venkatesh Srinivas
Mr. Venkatesh Srinivasan has a tremendous amount of experience in the
pharmaceutical industry and currently serves as President of Micro Labs USA and
previously served as President of Rising Pharma, USA and as President and CEO of
Ascend Laboratories, USA where he grew the business, building a new team and
strengthening processes and systems. In addition, Mr. Srinivasan served as a
Director at Pfizer India. Mr. Mr. Venkatesh Srinivasan has been serving as an
independent director of Aesther Healthcare Acquisition Corp. since 2021.
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Siva Srinivasan
Mr. Siva Saravanan has more than 20 years of experience steering digital
strategies and technology solutions for businesses. Mr. Saravanan is the Chief
Digital Officer at Wavestone US, helping Fortune 1000 business and technology
leaders accelerate digital transformation. Prior to joining Wavestone US, Siva
was Chief Information Officer and SVP of Business Operations at Reviver, an
exciting IoT start-up that creates connected digital license plates to enable
true autonomous driving. He designed customer digital experiences, unified
commerce, supply chain, field service operations and the digital agenda for
Reviver. Siva was also VP for IT Digital Transformation and Program Delivery at
Aristocrat Technologies. While at Aristocrat Technologies, he led the
transformation of business systems for a leading high-tech gaming manufacturer.
Siva spent many years at Verifone as a Senior Director supporting technology
operations in 40+ countries and also taking on delivery responsibilities. At
VeriFone, he built a world-class global integrated supply chain network for
agility and efficiency. Mr. Saravanan holds a M.S. in Systems Engineering from
Tennessee State University and B.S in Mechanical Engineering from Annamalai
University in Chidambaram, India. He is also on the Advisory Board of NishTech
Inc., a digital commerce company and the Advisory Council of George Washington
University School of Business Digital Program. Siva is a member of Forbes
Technology Council contributing regularly. Mr. Siva Saravanan has been serving
as an independent director of Aesther Healthcare Acquisition Corp. since 2021.
Committee Appointments
The Company already has an audit committee, compensation committee, and
nominating and corporate governance committee. The nominating and corporate
governance committee is comprised entirely of independent directors and acts
under a written charter, which more specifically sets forth its responsibilities
and duties, as well as requirements for the nominating and corporate governance
committee's composition and meetings. The nominating and corporate governance
committee charter, along with the charters for the other committees, is
available on the SEC's website at sec.gov.
As a result of recent departures from the board and the new appointments, the
committees of the board of directors currently consists of the following
members:
• Audit Committee; Michael Peterson as Chairman; Donald Fell and Siva Srinivasan
as members
. . .
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.
Exhibit No. Description
10.1 Purchase Agreement, dated December 28, 2022
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