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NewHold Investment Corp. II Announces That it will not Amend its Charter
Rhea-AI Impact
(Neutral)
Rhea-AI Sentiment
(Neutral)
Tags
Rhea-AI Summary
NewHold Investment Corp. II (NHICU) announced shareholder approval for the "Extension Amendment" and "Termination Amendment" allowing the Board discretion to extend proxy filing dates and redeem public shares. However, the Board has chosen not to effectuate these amendments. On December 24, 2022, NHIC II's sponsor entered a Backstop Agreement to fund up to $1 million for any excise tax liabilities arising from liquidation under the Inflation Reduction Act of 2022. The Board continues to pursue a business combination, citing strong deal opportunities.
Positive
Board's decision to continue seeking a business combination indicates confidence in future deals.
Existence of Backstop Agreement provides financial support for potential excise tax liabilities.
Negative
Board opted not to effectuate the approved amendments, possibly limiting strategic options.
Potential for 1% excise tax on stock repurchases may pose financial risks.
NEW YORK--(BUSINESS WIRE)--
NewHold Investment Corp. II (“NHIC II” or the “Company”) (NASDAQ: NHIC,NHICU) announced today that while NHIC II shareholders approved the “Extension Amendment,” which would give the Company’s board of directors (the “Board”) the discretion to extend the date by which NHIC has to file a proxy with respect to a business combination from April 25, 2023 to June 25, 2023, and the “Termination Amendment,” which would give the Board the discretion to redeem all of its outstanding public shares and liquidate on December 28, 2022 in advance of the automatic termination date in the Company’s existing Certificate of Incorporation, the Board has decided not to effect either amendment.
On December 24, 2022, NHIC II’s sponsor entered into an Excise Tax Backstop Agreement (the “Backstop Agreement”). Pursuant to the Backstop Agreement, the backstop party (the “Backstop Party”) committed to fund up to $1.0 million of any excise tax liability (the “Backstop Commitment”) in the event that the Company is subject to the 1% excise tax on stock repurchases under Section 4501 of the Internal Revenue Code, as enacted by the Inflation Reduction Act of 2022, in connection with the Company’s liquidation and dissolution if it is not able to complete a business combination.
At this time, considering its strong pipeline of deal opportunities and the existence of the Backstop Agreement, the Board has elected to continue to search for an initial business combination in accordance with the Company’s existing Certificate of Incorporation and Investment Management Trust Agreement.
For more information, please refer to the Current Report on Form 8-K filed by NHIC II with the Securities and Exchange Commission on December 27, 2022.
About NewHold Investment Corp. II
NewHold Investment Corp. II is a blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. The Company intends to focus its search on target businesses in the industrial technology sector with an aggregate enterprise value of $700 million or greater. For more information please visit https://nhicspac.com. The information contained on, or accessible through, the Company’s website is not incorporated by reference into this press release, and you should not consider it a part of this press release.
What changes did NewHold Investment Corp. II shareholders approve on December 24, 2022?
Shareholders approved the "Extension Amendment" and "Termination Amendment," allowing the Board to extend proxy filing dates and redeem public shares.
What is the Backstop Agreement related to NewHold Investment Corp. II?
The Backstop Agreement involves a commitment of up to $1 million to cover excise tax liabilities if the company undergoes liquidation without completing a business combination.
What are the implications of the Board's decision not to effectuate the approved amendments?
The decision may limit the company's strategic options and impact shareholder value.
What is the main focus of NewHold Investment Corp. II's business combination efforts?
The company aims to target businesses in the industrial technology sector with an enterprise value of $700 million or greater.
