VIVEON HEALTH ACQUISITION CORP. Item 1.01 Entry into a Material Definitive Agreement
Merger Agreement
On
Merger Consideration Initial Consideration
The total consideration to be paid at Closing (the "Initial Consideration") by
Viveon to Suneva security holders will be an amount equal to
Earnout Payments
In addition to the Initial Consideration, the Suneva security holders will also have the contingent right to earn up to 12,000,000 shares of Viveon Common Stock in the aggregate ("Earnout Consideration") as follows:
? The Suneva security holders will earn 4,000,000 shares of the Earnout
Consideration, in the aggregate, if at any time during the period beginning on
the date of the Closing (the "Closing Date") and ending on the second
anniversary of the Closing Date (the "First Earnout Period"), the VWAP (as
defined in the Merger Agreement) of the Viveon Common Stock over any twenty (20)
Trading Days (as defined in the Merger Agreement) within any thirty (30) Trading
Day period is greater than or equal to
? The Suneva security holders will earn an additional 4,000,000 shares of the
Earnout Consideration, in the aggregate, if at any time during the period
beginning on the Closing Date and ending on the third anniversary of the Closing
Date (the "Second Earnout Period"), the VWAP of the Viveon Common Stock over any
twenty (20) Trading Days within any thirty (30) Trading Day period is greater
than or equal to
? The Suneva security holders will earn an additional 4,000,000 shares of the
Earnout Consideration, in the aggregate, if at any time during the period
beginning on the Closing Date and ending on the fifth anniversary of the Closing
Date (the "Third Earnout Period" and together with the First Earnout Period and
the Second Earnout Period, each, an "Earnout Period" and collectively, the
"Earnout Periods"), the VWAP of the Viveon Common Stock over any twenty (20)
Trading Days within any thirty (30) consecutive Trading Day period is greater
than or equal to
? Upon the first Change in Control to occur during the applicable Earnout Period, if the corresponding price per share of Viveon Common Stock in connection with such Change in Control is equal to or greater than the Earnout Milestone or Milestones in respect of such Earnout Period, the Suneva security holders will earn the shares of the Earnout Consideration issuable in respect to such Earnout Milestone or Milestones as described above as of immediately prior to the Change of Control.
The aggregate shares of the Earnout Consideration (1) will be issued to the Suneva security holders at Closing in accordance with their respective pro rata shares of the Earnout Consideration (determined based on the fully diluted Suneva capital stock, including stock options, warrants and convertible notes), except that shares of the Earnout Consideration issued in respect of Suneva stock options will be retained by Viveon and not issued to the holders of Suneva stock options, and (2) will be placed in escrow at Closing.
1
In the case of the Suneva security holders (other than holders of Suneva stock options), the shares of the Earnout Consideration will not be released from escrow until they are earned as a result of the occurrence of the applicable Earnout Milestone. Shares of the Earnout Consideration not earned on or before the expiration of the applicable Earnout Period will be automatically forfeited and cancelled.
In the case of the holders of Suneva stock options, the shares of the Earnout Consideration will not be released from escrow until the later of the occurrence of the applicable Earnout Milestone within the applicable Earnout Period and the date on which the assumed stock options of such holder vest, but only if such holder continues to provide services to Viveon or one of its subsidiaries at such time. Shares of the Earnout Consideration that are not earned by a holder of Suneva Stock options on or before the fifth anniversary of the Closing Date will be forfeited without any consideration. Shares forfeited by a holder of Suneva stock options will be reallocated to the other Suneva security holders who remain entitled to receive shares of Earnout Consideration in accordance with their respective pro rata shares
Treatment of
Cancellation of Securities. Each share of Suneva capital stock, if any, that is owned by Viveon, Merger Sub, Suneva, or any of their subsidiaries (as treasury stock or otherwise) immediately prior to the effective time of the Merger (the "Effective Time"), will automatically be cancelled and retired without any conversion or consideration.
Preferred Stock. Immediately prior to the Effective Time, each issued and
outstanding share of Suneva's Series AA Preferred Stock, par value
Common Stock. Immediately prior to the Effective Time, each issued and
outstanding share of Suneva's common stock, par value
Stock Options.At the Effective Time, each outstanding option to purchase shares of Suneva Common Stock will be converted into (1) an option to purchase, subject to substantially the same terms and conditions as were applicable under such options prior to the Effective Time, shares of Viveon Common Stock equal to the number of shares subject to such option prior to the Effective Time multiplied by the Conversion Ratio, at an exercise price per share of Viveon Common Stock equal to the exercise price per share of Suneva Common Stock subject to such option divided by the Conversion Ratio and (2) the holder thereof will be entitled to receive shares of the Earnout Consideration as, and subject to the contingencies, described above.
Warrants. Contingent on and effective as of immediately prior to the Effective Time, each outstanding warrant to purchase shares of Suneva Preferred Stock or Suneva Common Stock will be treated in accordance with the terms of the relevant agreements governing such warrants and converted into shares of Suneva Preferred Stock or Suneva Common Stock and such shares will be treated as described above. All such warrants will be cancelled and extinguished.
Convertible Notes. Contingent on and effective as of immediately prior to the Effective Time, Suneva's convertible notes outstanding as of immediately prior to the Effective Time, will be treated in accordance with the terms of the relevant agreements governing such convertible notes and converted into shares of Suneva Preferred Stock or Suneva Common Stock and such shares will be treated as described above.
2
Representations and Warranties
The Merger Agreement contains customary representations and warranties of the parties thereto with respect to, among other things, (a) corporate existence and power, (b) authorization to enter into the Merger Agreement and related transactions; subsidiaries; (c) governmental authorization, (d) non-contravention, (e) capitalization; ( f) corporate records, (g) consents, (h) . . .
Item 7.01 Regulation FD Disclosure.
On
Furnished as Exhibit 99.2 is the investor presentation that will be used by Viveon and Suneva in connection with the Merger and related matters.
The information in this Item 7.01 and Exhibits 99.1 and 99.2 attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such filing.
Important Information for Investors and Stockholders
This document relates to a proposed transaction between Viveon and Suneva. This
document does not constitute an offer to sell or exchange, or the solicitation
of an offer to buy or exchange, any securities, nor shall there be any sale of
securities in any jurisdiction in which such offer, sale or exchange would be
unlawful prior to registration or qualification under the securities laws of any
such jurisdiction. Viveon intends to file a registration statement on Form S-4
with the
Investors and security holders will be able to obtain free copies of the
registration statement, the proxy statement/prospectus and all other relevant
documents filed or that will be filed with the
Forward Looking Statements
Certain statements included in this Current Report on Form 8-K are not historical facts but are forward-looking statements. Forward-looking statements generally are accompanied by words such as "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect," "should," "would," "plan," "future," "outlook," and similar expressions that predict or indicate future events or trends or that are not statements of historical matters, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements include, but are not limited to, statements regarding estimates and forecasts of the closing of the Merger, achievement of the conditions necessary for the closing of the Merger, achievement of the Earnout Consideration, other performance metrics and projections of market opportunity. These statements are based on various assumptions, whether or not identified in this Current Report on Form 8-K and on the current expectations of Viveon's and Suneva's respective management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of Viveon and Suneva. Some important factors that could cause actual results to differ materially from those in any forward-looking statements could include changes in domestic and foreign business, market, financial, political and legal conditions.
These forward-looking statements are subject to a number of risks and
uncertainties, including, the inability of the parties to successfully or timely
consummate the Merger, including the risk that any required regulatory approvals
are not obtained, are delayed or are subject to unanticipated conditions that
could adversely affect the Company or the expected benefits of the Merger, if
not obtained; the failure to realize the anticipated benefits of the Merger;
matters discovered by the parties as they complete their respective due
diligence investigation of the other parties; the ability of Viveon prior to the
Merger, and Suneva following the Merger, to maintain the listing of the
Company's shares on the NYSE American; costs related to the Merger; the failure
to satisfy the conditions to the consummation of the Merger, including the
approval of the Merger Agreement by the stockholders of Viveon, the satisfaction
of the minimum cash requirements of the Merger Agreement following any
redemptions by Viveon's public stockholders; the risk that the Merger may not be
completed by the stated deadline and the potential failure to obtain an
extension of the stated deadline; the outcome of any legal proceedings that may
be instituted against Viveon or Suneva related to the Merger, expiration of, or
failure to extend, the period of time Viveon is afforded under its
organizational documents and the final prospectus of Viveon, dated
6
If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that neither Viveon nor Suneva presently know, or that Viveon and Suneva currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Viveon and Suneva's current expectations, plans and forecasts of future events and views as of the date hereof. Nothing in this Current Report on Form 8-K and the attachments hereto should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements in this Current Report on Form 8-K and the attachments hereto, which speak only as of the date they are made and are qualified in their entirety by reference to the cautionary statements herein and the risk factors of Viveon and Suneva described above. Viveon and Suneva anticipate that subsequent events and developments will cause their assessments to change. However, while Viveon and Suneva may elect to update these forward-looking statements at some point in the future, they each specifically disclaim any obligation to do so, except as required by law. These forward-looking statements should not be relied upon as representing Viveon or Suneva's assessments as of any date subsequent to the date of this Current Report on Form 8-K. Accordingly, undue reliance should not be placed upon the forward-looking statements.
Participants in the Solicitation
Viveon and Suneva and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from Viveon's stockholders in connection with the proposed Merger. A list of the names of the directors and executive officers of Viveon and information regarding their interests in the Merger will be contained in the proxy statement/prospectus when available. You may obtain free copies of these documents as described in the second paragraph under the above section entitled "Important Information for Investors and Stockholders."
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of any securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such other 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.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits: Exhibit Description 2.1* Merger Agreement dated as ofJanuary 12, 2022 , by and amongSuneva Medical, Inc. ,Viveon Health Acquisition Corp. andVHAC Merger Sub, Inc. 10.1 Form of Parent Stockholder Support Agreement dated as ofJanuary 12, 2022 , by and amongViveon Health Acquisition Corp. ,Suneva Medical, Inc. and certain stockholders ofViveon Health Acquisition Corp. 10.2 Form of Company Stockholder Support Agreement dated as ofJanuary 12, 2022 , by and amongViveon Health Acquisition Corp. ,Suneva Medical, Inc. and certain stockholders ofSuneva Medical, Inc. 10.3 Form of Lock-Up Agreement, dated as ofJanuary 12, 2022 between the Holder (defined therein) andViveon Health Acquisition Corp. 10.4 Form of Amended and Restated Registration Rights Agreement effective as of as of the 12th day of January, 2022, by and amongSuneva Holdings, Inc. (formerly known asViveon Health Acquisition Corp. ), each of the undersigned parties that arePre-BC Investors (as defined therein, and each of the former stockholders ofSuneva Medical, Inc. , whose names are listed on Exhibit A thereto). 99.1 Press Release issued by Viveon onJanuary 12, 2022 . 99.2 Investor Presentation datedDecember 2021 . 104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
* Certain exhibits and schedules to this Exhibit have been omitted in accordance
with Regulation S-K Item 601(b)(2). Viveon agrees to furnish supplementally a
copy of all omitted exhibits and schedules to the Securities and Exchange
Commission upon its request.
7
© Edgar Online, source
