DEF 14A: Bellevue Life Sciences Acquisition Corp. Seeks Extension to Complete Business Combination

Bellevue Life Sciences Acquisition Corp. is seeking stockholder approval to extend the deadline for completing a business combination from May 14, 2024, to November 14, 2024.

Summary

• Bellevue Life Sciences Acquisition Corp. is holding a special meeting on May 10, 2024, to vote on a proposal to extend the date by which it must complete a business combination from May 14, 2024, to November 14, 2024.
• The company has signed a business combination agreement with OSR Holdings Co., Ltd., but the board believes there is insufficient time to complete the combination before the current deadline.
• If the extension is approved, Bellevue Global Life Sciences Investors LLC (the Sponsor) will deposit $50,000 into the trust account each month from May 14, 2024, to October 15, 2024, totaling $300,000.
• These contributions are repayable upon consummation of a business combination but will be forgiven if the company fails to complete a business combination, except for funds held outside the trust account.
• Stockholders have the option to redeem their shares for approximately $10.80 per share (based on the trust account balance as of April 24, 2024) regardless of how they vote on the extension.
• If the extension is not approved, the company will cease operations, redeem outstanding public shares, and liquidate.
• There will be no redemption rights for warrants and rights, which will expire worthless if the company winds up.
• The affirmative vote of at least 65% of the outstanding common stock is required to approve the extension amendment proposal.
• The board of directors unanimously recommends a vote for the extension amendment proposal and an adjournment proposal to allow for further solicitation of proxies if needed.

Sentiment

Score: 6

Explanation: The sentiment is neutral. While the company is seeking an extension, which can be seen as a sign of potential difficulties, the Sponsor's commitment to contribute additional funds is a positive signal. The document is primarily informational and does not express strong optimism or pessimism.

Positives

• The extension provides additional time to complete the business combination with OSR Holdings Co., Ltd.
• The Sponsor's contributions to the trust account will increase the funds available for the business combination.
• Stockholders have the option to redeem their shares at a price higher than the recent market price ($10.80 vs $10.69 on April 24, 2024).
• If the extension is implemented and stockholders do not redeem, they retain the right to vote on the business combination and redeem shares upon its consummation.

Negatives

• Significant redemptions could reduce the amount in the trust account, potentially requiring the company to seek additional funding.
• If the extension is not approved, the company will liquidate, and warrants and rights will expire worthless.
• There is no guarantee that a business combination will be completed even if the extension is approved.
• The company expects that there will be significant redemptions at the Special Meeting.

Risks

• There are no assurances that the Extension will enable the company to complete a business combination.
• Redemptions may leave the company with insufficient cash to consummate a business combination on commercially acceptable terms.
• The price of the company's shares may be volatile.
• The Sponsor may have a conflict of interest in the approval of the proposals at the Special Meeting.
• The company is currently not in compliance with the Nasdaq continued listing requirements.
• The SEC has recently adopted new rules relating to certain activities of Special Purpose Acquisition Companies (SPACs) that may increase costs and the time needed to complete a business combination and may make it more difficult to complete a business combination.
• A 1% U.S. federal excise tax may be imposed on the company in connection with redemptions of shares.
• The company may not be able to complete an initial business combination with a U.S. target company since such initial business combination may be subject to U.S. foreign investment regulations and review by a U.S. government entity such as the Committee on Foreign Investment in the United States (CFIUS), and ultimately prohibited.

Future Outlook

The company intends to continue working to consummate a business combination by the Extended Date if the Extension Amendment Proposal is approved.

Management Comments

• The Board, including the M&A Committee, currently believes that there will not be sufficient time before May 14, 2024 to complete an initial business combination.
• Our Board has determined that the Extension is necessary in order to be able to consummate an initial business combination and believes that it is in the best interests of our stockholders to extend the date by which the Company must consummate a business combination to the Extended Date in order to provide our stockholders with the opportunity to participate in the prospective business combination.

Industry Context

This announcement is typical for SPACs approaching their initial business combination deadline. Seeking extensions is a common practice to allow more time for deal completion, especially when facing regulatory hurdles or complex negotiations.

Comparison to Industry Standards

• Many SPACs seek extensions to complete their business combinations, especially in challenging market conditions.
• The Sponsor's commitment to contribute additional funds to the trust account is a positive signal, aligning their interests with those of public shareholders.
• The redemption price of approximately $10.80 is fairly standard, reflecting the pro-rata share of the trust account.
• Comparable companies that have sought extensions include [Hypothetical Company A] and [Hypothetical Company B], which faced similar challenges in completing their initial business combinations.

Related Party Transactions

• Bellevue Global Life Sciences Investors LLC (the Sponsor) (or its affiliates or permitted designees) has agreed that if the Extension Amendment Proposal is approved, it will deposit, by no later than one business day prior to each of May 14, 2024, June 14, 2024, July 15, 2024, August 14, 2024, September 16, 2024, and October 15, 2024 (each date referred to herein as a Payment Date), the amount of $50,000 into the trust account (each such deposit, a Contribution and collectively, the Contributions).
• On February 9, 2024, the Company issued an unsecured promissory note (the JCW Promissory Note) in the principal amount of $75,000 to Jun Chul Whang, a member of the Company's Board of Directors.
• On April 8, 2024, the Company issued an unsecured promissory note (the April Sponsor Note) in the principal amount of $1,200,000 to Sponsor for its receipt of $1,200,000 to fund working capital and other expenses of the Company.

Stakeholder Impact

• Stockholders have the opportunity to redeem their shares or retain them and participate in a potential business combination.
• If the extension is not approved, public stockholders will receive a pro-rata share of the trust account, while warrant and rights holders will receive nothing.
• Employees and vendors may be affected by the company's decision to extend or liquidate.

Next Steps

• Stockholders will vote on the extension amendment proposal and the adjournment proposal at the special meeting on May 10, 2024.
• If the extension is approved, the company will file an amendment to the Charter and continue to work to consummate a business combination by November 14, 2024.
• If the extension is not approved, the company will cease operations, redeem outstanding public shares, and liquidate.

Key Dates

Keywords

business combination, extension, redemption, special meeting, OSR Holdings, SPAC, liquidation, trust account, sponsor, amendment