American Battery Materials Inc (BLTH)

[JMMatthews]

Merger Agreement:

On June 01, 2023, American Battery Materials, Inc., a Delaware corporation (“ABM”, or the “Company”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among Seaport Global Acquisition II Corp., a Delaware corporation (NASDAQ: SGII) (“SGII”), and Lithium Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of SGII (“Merger Sub”).

SGII is a blank check company, also referred to as a special purpose acquisition company (SPAC), formed for the purpose of effectuating a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses. SGII is an early stage and emerging growth company.

Pursuant to the Merger Agreement, Merger Sub will merge with and into ABM, with ABM surviving the merger (the “Merger” and, together with the other transactions contemplated by the Merger Agreement, the “Transactions”). As a result of the Transactions, ABM will become a wholly-owned subsidiary of SGII, with the stockholders of ABM becoming stockholders of SGII.

Under the Merger Agreement, the stockholders of ABM will receive a number of shares of SGII common stock based on an exchange ratio (the “Exchange Ratio”), the numerator of which is equal to the number of shares of SGII common stock equal to the quotient of (i) (A) $160,000,000, plus (B) Closing Date Cash, minus (C) the Closing Date Indebtedness, plus (D) the aggregate exercise price of all Company Warrants (excluding any Company Warrants that will terminate by their terms upon the Effective Time), divided by (ii) $10.00, and the denominator of which is equal to the number of outstanding shares of ABM, including Company Convertible Note Conversion Shares (all capitalized terms in the Exchange Ratio as defined in the Merger Agreement).

The holders of Specified Convertible Notes will receive a number of shares of SGII common stock determined by dividing all principal and accrued interest under such notes by the applicable conversion prices set forth in such notes. The holders of ABM options and warrants will receive SGII options and warrants equal to the number of shares of ABM Common Stock subject to the ABM options and warrants multiplied by the Exchange Ratio, at an exercise price per share equal to the exercise price of the ABM options and warrants divided by the Exchange Ratio.

In connection with the Transactions, Seaport Global SPAC II, LLC (“Sponsor”), SGII’s sponsor from its initial public offering, agreed to enter into a lock-up agreement (the “Sponsor Lock-Up Agreement”), pursuant to which the SGII common stock held by Sponsor will be subject to transfer restrictions until the earlier of (i) one year from the Closing of the Merger; (ii) the date on which the last sales price of SGII common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20-trading days within any 30-trading day period commencing at least 150-trading days after the Closing of the Merger; and, (iii) the date on which SGII completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of SGII’s stockholders having the right to exchange their shares of common stock for cash, securities or other property.

Certain stockholders of ABM receiving shares of SGII common stock in connection with the Merger have agreed to enter into lock-up agreements (the “Stockholder Lock-Up Agreement”), pursuant to which such stockholders will be subject to the same lockup period to which Sponsor will be subject for all shares of SGII common stock held by such persons.

The Transactions are expected to be consummated in 2023, after the required approval by the stockholders of SGII and the fulfillment of certain other conditions.

The following summaries of the Merger Agreement and the other agreements to be entered into by the parties are qualified in their entirety by reference to the text of the Merger Agreement and agreements entered into in connection therewith. The Merger Agreement is attached as Exhibit 2.1 hereto and incorporated herein by reference. Capitalized terms not defined herein have the meaning given in the Merger Agreement.

https://www.sec.gov/Archives/edgar/data/1487718/000121390023045392/ea179613-8k425_american.htm

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