New Horizon Aircraft Reports Material Agreement, Asset Deal, Equity Sales

Ticker: HOVRW · Form: 8-K · Filed: Jan 19, 2024 · CIK: 1930021

Complexity: moderate

Sentiment: mixed

Topics: acquisition, equity-sales, corporate-action, material-agreement

TL;DR

**New Horizon Aircraft just made big moves with agreements, asset deals, and selling new shares.**

AI Summary

New Horizon Aircraft Ltd. filed an 8-K on January 19, 2024, reporting events from January 12, 2024, including an entry into a material definitive agreement, completion of an acquisition or disposition of assets, and unregistered sales of equity securities. This indicates significant corporate restructuring and potential capital raises. For investors, this matters because these actions can impact the company's financial health, ownership structure, and future growth prospects, potentially leading to stock price volatility as the market digests these changes.

Why It Matters

This filing signals major corporate actions, including potential changes in ownership and financial structure, which could significantly affect the company's valuation and future performance.

Risk Assessment

Risk Level: medium — The filing indicates significant corporate changes and equity sales, which can introduce uncertainty and potential dilution for existing shareholders.

Analyst Insight

A smart investor would closely monitor subsequent filings for details on the material agreements, asset transactions, and the impact of equity sales on dilution, as these events could significantly alter the company's financial outlook and share value.

Key Numbers

Key Players & Entities

Forward-Looking Statements

FAQ

What was the earliest event reported in this 8-K filing?

The earliest event reported in this 8-K filing occurred on January 12, 2024, as stated under 'Date of Report (Date of earliest event reported): January 12, 2024'.

What specific types of material events did New Horizon Aircraft Ltd. report in this 8-K?

New Horizon Aircraft Ltd. reported 'Entry into a Material Definitive Agreement', 'Completion of Acquisition or Disposition of Assets', and 'Unregistered Sales of Equity Securities' as key item information in this 8-K filing.

What was the former name of New Horizon Aircraft Ltd.?

The former name of New Horizon Aircraft Ltd. was Pono Capital Three, Inc., with the name change occurring on 20220519, as indicated in the 'FORMER COMPANY' section.

Where is New Horizon Aircraft Ltd.'s principal executive office located?

New Horizon Aircraft Ltd.'s principal executive office is located at 3187 Highway 35, Lindsay, Ontario, K9V 4R1, according to the filing.

What is the fiscal year end for New Horizon Aircraft Ltd.?

The fiscal year end for New Horizon Aircraft Ltd. is May 31, as stated in the 'COMPANY DATA' section under 'FISCAL YEAR END: 0531'.

Filing Stats: 4,605 words · 18 min read · ~15 pages · Grade level 15.1 · Accepted 2024-01-19 17:12:17

Key Financial Figures

Filing Documents

01

Item 1.01. Entry into Material Definitive Agreement.

Business

Business Combination Agreement As disclosed under the section titled " Proposal No. 2 — The Business Combination Proposal " of the Proxy Statement/Prospectus, Pono entered into the BCA, dated August 15, 2023, by and among Pono, Merger Sub and Horizon. Accordingly, (a) Pono was continued and de-registered from the Cayman Islands and redomesticated as a British Columbia Company on January 11, 2024, (b) Merger Sub, a wholly-owned subsidiary of Pono, was amalgamated with Horizon on January 12, 2024, and (c) Pono changed its name to New Horizon Aircraft Ltd. and adopted new Articles. Item 2.01 of this Current Report discusses the consummation of the Business Combination and events contemplated by the BCA which were completed on January 12, 2024 (the " Closing "), and is incorporated herein by reference. 1 Lock-up Agreements On January 11, 2024, Pono entered into Lock-Up Agreements (the " Lock-up Agreements ") by and among Pono, the Sponsor, and certain shareholders of Horizon (such shareholders, the " Company Holders "), pursuant to which each Company Holder agreed not to, during the Lock-up Period (as defined below), lend, offer, pledge, hypothecate, encumber, donate, assign, sell, contract to sell, sell any option or contract to purchase, purchase an option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any of the shares issued to such Company Holder in connection with the Business Combination (the " Lock-up Shares "), enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of such shares, or publicly disclose the intention to do any of the foregoing, whether any of these transactions are to be settled by delivery of any such shares or other securities, in cash, or otherwise, subject to limited exceptions. As used herein, " Lock-Up Period " means the period commencing on the date of the Closing and

01

Item 2.01. Completion of Acquisition or Disposition of Assets. The disclosure set forth in the " Introductory Note " and " Business Combination Agreement " above is incorporated into this Item 2.01 by reference. Pursuant to the terms of the BCA, the total consideration for the Business Combination and related transactions (the " Exchange Consideration ") was approximately $99 million. In connection with the Special Meeting, holders of 9,852,558 Pono Class A ordinary shares sold in its initial public offering exercised their right to redeem those shares for cash prior to the redemption deadline of January 2, 2024 (and did not subsequently reverse the redemption election), at a price of $10.60989602 per share, for an aggregate payment from Pono's trust account of approximately $104.535 million. Effective January 16, 2024, Pono's units ceased trading, and New Horizon's common stock and warrants began trading on the Nasdaq Capital Market under the symbols "HOVR" and "HOVRW," respectively. After taking into account the aggregate payment in respect of the redemption, Pono's trust account had a balance immediately prior to the Closing of approximately $17.45 million. Such balance in the trust account, together with approximately $2.00 million in proceeds from the PIPE Offering, were used to pay transaction expenses and other liabilities of Pono, and pay approximately $16.8 million to Meteora under the Forward Purchase Agreement. No shares were issued to Meteora under the FPA Funding Amount Subscription Agreement. As discussed in the Introductory Note above, in connection with the Business Combination, Horizon shareholders received 8,382,498 New Horizon Class A ordinary shares, 282,573 New Horizon Class A ordinary were put into an escrow account to satisfy purchase price adjustments under the BCA, if any, the remainder of which will be transferred to the Horizon shareholders pro rata, and 754,013 Incentive Shares were transferred to the PIPE investor or its designees

Business

Business The business of New Horizon is described in the Proxy Statement/Prospectus in the section titled " Information About Horizon " and that information is incorporated herein by reference. Risk Factors The risks associated with New Horizon are described in the Proxy Statement/Prospectus in the section titled " Risk Factors ," which is incorporated herein by reference. Financial Information Reference is made to the disclosure set forth in Item 9.01 of this Current Report on Form 8-K concerning the financial information of New Horizon. Reference is further made to the disclosure contained in the Proxy Statement/Prospectus in the sections titled " Selected Financial Information of Horizon, " " Management's Discussion and Analysis of Financial Condition and Results of Operations of Horizon ," and " Unaudited Pro Forma Condensed Consolidated Combined Financial Information " which are incorporated herein by reference. In addition, the Unaudited Pro Forma Condensed Combined Financial Information for the period ended September 30, 2023 is included as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Properties

Properties New Horizon leases office space and an aircraft hangar in Lindsay Ontario, which serves as the corporate headquarters, and office space and light composite manufacturing space in Haliburton Ontario. New Horizon believes that these properties are sufficient for its business and operations as currently conducted. Management's Discussion and Analysis of Financial Condition and Results of Operations The disclosure contained under the heading " Management's Discussion and Analysis of Financial Condition and Results of Operations of Horizon " in the Proxy Statement/Prospectus is incorporated herein by reference. Security The following table sets forth information regarding the beneficial ownership of shares of New Horizon common shareholders upon the completion of the Business Combination by: each person known by New Horizon to be the beneficial owner of more than 5% of any class of New Horizon's common shares; each of New Horizon's officers and directors; all executive officers and directors of New Horizon. Beneficial if he, she or it possesses sole or shared voting or investment power over that security, including options and warrants that are currently exercisable or exercisable within 60 days. In the table below, percentage ownership is based on 16,974,523 common shares outstanding as of January 12, 2024, including 9,419,084 Class A ordinary shares issued as Exchange Consideration, 200,000 Class A ordinary shares issued in connection with the PIPE financing, and reflects the valid redemption of 9,852,558 Class A ordinary shares by public shareholders of Pono. The table below includes Exchange Consideration shares held in escrow pending any purchase price adjustment under the BCA, and excludes the common shares underlying the Private Warrants held or t

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