Item 1.01. |
Entry into a Material Definitive Agreement.
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Business Combination Agreement
On March 13, 2023, HCM Acquisition Corp, a Cayman Islands exempted company
(“HCM”), entered into a Business Combination Agreement (the “Agreement”), by and among MURANO PV, S.A. DE
C.V., a Mexican corporation (the “Company”), Elías Sacal Cababie, an individual (“ESC”), ES Agrupación, S.A. de C.V., a Mexican corporation (the “ESAGRUP” and collectively with ESC, the “Seller”), Murano Global B.V. a private limited liability company under Dutch law (“PubCo”), MPV Investment B.V., a private limited liability company under Dutch law, which is a direct wholly-owned subsidiary of PubCo (“HoldCo”) and Murano Global Cayman,
a Cayman Islands exempted company incorporated with limited liability which is a direct wholly-owned subsidiary of PubCo (“New CayCo” and together with the Company, Seller, PubCo and HoldCo, the “Murano Parties”). The Merger (as defined below) was unanimously approved by HCM’s Board of Directors and by the Company’s
Board of Directors. If the Agreement is approved by HCM’s shareholders and Company’s shareholders, and the transactions
contemplated by the Agreement are consummated, (i) New CayCo will merge with and into HCM, the separate corporate existence of New CayCo will cease, and HCM will be the surviving company (the “Surviving Company”) and a wholly owned direct
subsidiary of PubCo (the “Merger”) and (ii) HCM will change its name to “Murano Global Hospitality”.
In addition, at the effective time of the Merger, (i) each issued and outstanding share of Class A Ordinary Shares and Class B Ordinary Shares, par value $0.0001
per share, of HCM (the “HCM Ordinary Shares”) will be automatically canceled and extinguished, and each holder of HCM Ordinary Shares will be entitled
to receive merger rights representing a corresponding number of PubCo Ordinary Shares, which are held in the accounts of the Exchange Agent (“Merger Rights”), and (ii) each issued and outstanding warrant to purchase one share of HCM Class A Ordinary Shares will automatically cease to represent a right to acquire HCM
Class A Ordinary Shares and will automatically convert into and represent a right to acquire PubCo Ordinary Shares (“Converted Warrant”) and each Converted Warrant (a) will represent the right to acquire the number of PubCo Ordinary Shares equal
to the number of HCM Class A Ordinary Shares, (b) will have an exercise price of $11.50 per whole warrant required to purchase one PubCo Ordinary Share, and (c) will expire on the five year anniversary of the Closing
Date.
The Company has made representations, warranties, and covenants in the Agreement, including, among others, covenants with
respect to its conduct and the conduct of its related group entities prior to the closing of the Merger (the “Closing”) and a covenant providing for HCM and the Company to jointly prepare, agree upon, and file a registration statement on Form F-4
(the “Registration Statement”) with the U.S. Securities and Exchange Commission (the “SEC”) (which will contain a prospectus of the Company and a proxy statement of HCM). The representations and warranties made in the Agreement will not survive the
consummation of the Merger. Additionally, and in connection with the transactions contemplated by the Agreement, on March 13, 2023, the underwriters of HCM’s initial public offering agreed to reduce the total deferred underwriting fee that is to be
paid to such underwriters upon the consummation of HCM’s initial business combination to $3,000,000.
The Closing is subject to certain customary conditions,
including, among others: (i) obtaining the required HCM shareholder approval; (ii) completion of the reorganization in accordance with the Agreement; (iii) Comisión Federal de Competencia Económica of Mexico having issued antitrust approval; (iv) the absence of any governmental order, statute, rule or regulation
enjoining or prohibiting the consummation of the Merger; (v) the deadline for HCM to consummate its initial Business Combination not having passed; (vi) the approval of the Listing Application by Nasdaq and PubCo’s compliance with listing
requirements of Nasdaq; (vii) the absence of any notice to PubCo of non-compliance therewith from Nasdaq that has not been cured;
(viii) the absence of any stop order issued by the SEC, and the absence of any proceeding seeking such a stop order having been threatened or initiated by the SEC which remains pending; (viii) the absence of any
law or order that is then in effect and which has the effect of making the transactions contemplated by the Agreement illegal or which otherwise prohibits or prevents the consummation of the transactions; (ix) the accuracy of the
representations and warranties of each party to the Agreement (subject to certain materiality standards set forth in the Agreement); and (x) compliance with each covenant by HCM and the Murano Parties. In addition, the obligation of HCM and the Murano Parties to
consummate the Merger are conditioned on (i) obtaining each of the consents set forth in the Agreement; (ii) obtaining the Company shareholder approvals; (iii) obtaining the New CayCo shareholder approval; and (iv) the absence of the occurrence of a continuing material adverse effect on the Company.
The Agreement may be terminated by HCM or the Company under certain circumstances, including, among others: (i) by mutual written consent of the Company and HCM; (ii) by the Company or HCM if the HCM shareholder approval is not obtained; (iii)
by written notice to the Company from HCM if (a) there is any breach of any representation, warranty, covenant or agreement on the part of the Company set forth in the Agreement, such that the conditions would not be satisfied at the Closing,
subject to certain exceptions, or (b) the Closing has not occurred on or before the Agreement End Date, unless HCM is in material breach; (iv) by HCM if the
Company shareholder approval shall not have been obtained within two Business Days after the date of the Agreement; and (v) by written notice to HCM from the Company if
there is any breach of any representation, warranty, covenant or agreement on the part of HCM set forth in the Agreement, such that the conditions specified would not be satisfied at the
Closing, subject to certain exceptions.
The foregoing description of the Agreement and the Merger does not purport to be complete and is qualified in its entirety by the terms and conditions of the Agreement, a copy of which is attached hereto
as Exhibit 2.1, and is incorporated herein by reference. The Agreement contains representations, warranties, and covenants that the parties to the Agreement made to each other as of the date of the Agreement or other specific dates. The
assertions embodied in those representations, warranties, and covenants were made for purposes of the contract among the parties and are subject to important qualifications and limitations agreed to by the parties in connection with negotiating
the Agreement. The Agreement has been attached to provide investors with information regarding its terms and is not intended to provide any other factual information about HCM, the Company, or any
other party to the Agreement. In particular, the representations, warranties, covenants, and agreements contained in the Agreement, which were made only for purposes of the Agreement and as of specific dates, were solely for the benefit of the
parties to the Agreement, may be subject to limitations agreed upon by the contracting parties, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors and reports and
documents filed with the SEC. Investors should not rely on the representations, warranties, covenants, and agreements, or any descriptions thereof, as characterizations of the actual state of facts or condition of any party to the Agreement. In
addition, the representations, warranties, covenants, and agreements and other terms of the Agreement may be subject to subsequent waiver or modification. Moreover, information concerning the subject matter of the representations and warranties
and other terms may change after the date of the Agreement, which subsequent information may or may not be fully reflected in HCM’s or the Company’s public disclosures.
Sponsor Support Agreement
HCM, the Company, and the Sponsor, concurrently with the execution and
delivery of the Agreement, have entered into the Sponsor Support Agreement (the “Sponsor Support Agreement”), pursuant to which the Sponsor has agreed, among other things, to vote (or execute and return an action by written consent), or cause to
be voted at the HCM shareholder’s meeting (or validly execute and return and cause such consent to be granted with respect to), all of its shares of HCM
Class B Ordinary Shares in favor of (A) the approval and adoption of the Agreement and approval of the Merger and all other transactions contemplated by the Agreement,
(B) against any action, agreement or transaction or proposal that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of HCM under the Agreement or
that would reasonably be expected to result in the failure of the Merger from being consummated and (C) each of the proposals and any other matters necessary or reasonably requested by HCM for consummation of the Merger and the other transactions contemplated by the Agreement. The foregoing description of the Sponsor Support Agreement and the transactions
contemplated thereby is not complete and is subject to, and qualified in its entirety by reference to, the actual agreement, a copy of which is filed with this Current Report on Form 8-K as Exhibit 10.1,
and the terms of which are incorporated herein by reference.