Chardan NextTech Acquisition 2 Corp. (NASDAQ:CNTQ) announced this afternoon that it has received requests to redeem 79.4% of its shares ahead of its shareholder vote tomorrow for its combination with energy storage firm Dragonfly Energy.
Following the redemption deadline yesterday, CNTQ noted it had received requests to redeem 2,071,910 shares of common stock. This amount excludes the 485,000 shares purchased in the open market by Chardan Capital Markets.
As a result, $31,430,584.81 will be removed from CNTQ’s trust account, leaving it with approximately $10,565,137.34 and 1,021,438 shares.
With the average redemption rate at 83.53%, Chardan NextTech 2 prepared for this by securing a $75 million loan with CCM Investments 5 LLC, an affiliate of Chardan Capital Markets, and EICF Agent LLC, as well as a $15 million stock purchase agreement with THOR Industries.
CNTQ originally brought $128.4 million into the deal from its current trust along with a $230 million PIPE consisting of $75 million senior secured term loan, which is to be used in part to refinance approximately $45 million of outstanding Dragonfly indebtedness, a $5 million PIPE at $10.00 per share from CNTQ’s Sponsor, Chardan NexTech Investments 2 LLC, and a $150 million Chardan Equity Facility from Chardan, an affiliate of the sponsor.
CNTQ shareholders are set to vote on the business combination at a special meeting tomorrow.
The SPAC announced its $500 million business combination with Dragonfly on May 16. Reno, Nevada-based Dragonfly creates lithium-ion batteries equipped with a proprietary battery management system that are currently used in recreational vehicles (RVs), marine vessels, material handling, off-grid residences and solar applications.
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