Chenghe Acquisition I Co. Enters into Prepaid Share Forward Agreement

Chenghe Acquisition I Co. (NASDAQ:LATGU) recently disclosed in an 8-K filing to the Securities and Exchange Commission on January 2, 2025, details of its prepaid share forward agreement entered into on December 27, 2024. The agreement involves Chenghe, along with FST Corp. and Femco Steel Technology Co., Ltd., partaking in a Business Combination Agreement.

The Prepaid Share Forward Agreement was made with Harraden Circle Investors, LP and Harraden Circle Special Opportunities, LP, collectively known as the Seller, for an OTC Prepaid Share Forward Transaction. The agreement involves the intended purchase of Class A ordinary shares, par value $0.0001 per share, of Chenghe by the Seller, up to a total of 3,000,000 shares from external parties or through share redemption.

Under the terms of the agreement, the Counterparty, referring to Chenghe before the Business Combination and CayCo post-combination, would prepay the Seller an amount equivalent to the total relevant and committed shares multiplied by the redemption price per share from the trust account assets. Additionally, the Seller can purchase up to 100,000 committed shares and is restricted from selling these shares below the Reset Price post-transaction.

The agreement allows for potential adjustments to the Reset Price under specific conditions and retains a maturity date 12 months after the Business Combination closure. On the maturity date, the Seller returns the relevant shares while benefiting from retaining an amount based on the redemption price per share, approximately priced at US$11.79 per share as of December 26, 2024.

For a comprehensive understanding of this agreement, interested parties are encouraged to refer directly to the Prepaid Share Forward Agreement filed as Exhibit 10.1 with the Securities and Exchange Commission.

In alignment with the reporting requirements, the company disclosed these details in its Form 8-K filing, outlining the specifics of the agreement and its potential financial implications for Chenghe. Investors and stakeholders can further investigate the implications and intricacies of this transaction in the official documentation.

The disclosure serves as an essential update on the ongoing activities and financial agreements involving Chenghe Acquisition I Co., shaping future endeavors and financial strategies for the company.

This article provides a concise review of the recent Prepaid Share Forward Agreement entered into by Chenghe Acquisition I Co., shedding light on the significant financial occurrences within the company.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Chenghe Acquisition I’s 8K filing here.

Chenghe Acquisition I Company Profile

Chenghe Acquisition I Co does not have significant operations. The company focuses on effecting a merger, share exchange, share purchase, asset acquisition, reorganization, or similar business combination with one or more businesses. It intends to focus its search for an initial business combination on businesses in Latin America or Hispanic-owned businesses in the United States.