Natural Shrimp in an 8-K said it entered into an equity financing agreement with GHS Investments. GHS agreed to provide the seafood company with up to $10 million upon effectiveness of a registration statement in connection with the proposed business combination with Yotta Acquisition.
Natural Shrimp will have the discretion to deliver puts to GHS, which will be obligated to purchase the company's shares. The maximum amount that Natural Shrimp can put to GHS in each notice cannot exceed 200% of the average daily trading dollar volume during the ten trading days preceding the put. The amount must be at least $10,000 but not greater than $1 million.
GHS would not be able to own more than 4.99% of the company's outstanding stock. The price of each put share shall be equal to 80% of the market price. Following an up-list to the Nasdaq or equivalent national exchange, the price of each put would then be equal to 90% of the market price, subject to a floor price of $1 per share.
Yotta Acquisition shareholders last month approved extending the SPAC's merger deadline in monthly increments up until April 2024. The SPAC's sponsor deposited $120,000 into trust for an extension until May 22.
Around the same time, Natural Shrimp filed an updated S-4 on the deal, which now has a valuation of $175 million — down from $275 million at announcement in October. Read more.