As filed with the Securities and Exchange Commission on March 30, 2022.
Registration No. 333-260928
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 8
to
to
FORM F-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
UNDER
THE SECURITIES ACT OF 1933
Prenetics Global Limited
(Exact Name of Registrant as Specified in Its Charter)
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Cayman Islands
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3826
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Not Applicable
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(State or Other Jurisdiction of
Incorporation or Organization) |
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(Primary Standard Industrial
Classification Code Number) |
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(I.R.S. Employer
Identification Number) |
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Unit 701-706, K11 Atelier King’s Road
728 King’s Road, Quarry Bay
Hong Kong
+852 2210-9588
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
728 King’s Road, Quarry Bay
Hong Kong
+852 2210-9588
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Cogency Global Inc.
122 East 42nd Street, 18th Floor
New York, N.Y. 10168
+1 (800) 221-0102
(Name, address, including zip code, and telephone number, including area code, of agent for service)
122 East 42nd Street, 18th Floor
New York, N.Y. 10168
+1 (800) 221-0102
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
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Jonathan B. Stone, Esq.
Paloma Wang, Esq. Skadden, Arps, Slate, Meagher & Flom LLP 42/F, Edinburgh Tower, The Landmark 15 Queen’s Road Central Hong Kong Tel: +852 3740-4700 |
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Peter X. Huang, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP 30/F, China World Office 2 No. 1, Jian Guo Men Wai Avenue Beijing 100004, P.R. China Tel: +86 10-6535-5500 |
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Jesse Sheley
Joseph Raymond Casey Ram Narayan Louis Rabinowitz Kirkland & Ellis International LLP 26th Floor, Gloucester Tower The Landmark 15 Queen’s Road Central Hong Kong Tel: +852-3761-3300 |
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Steve Lin
Kirkland & Ellis International LLP 29th Floor, China World Office 2 No.1 Jian Guo Men Wai Avenue Beijing 100004, P.R. China Tel: +86 10-5737-9300 |
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Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement becomes effective.
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration for the share offering. ☐
If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) ☐
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) ☐
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
Emerging growth company ☒
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
†
The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
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issuer after it is identified as a Commission-Identified Issuer for three consecutive years. On December 16, 2021, the PCAOB issued a report on its determinations that it is unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China and in Hong Kong, because of positions taken by one or more authorities in such jurisdictions. Since Prenetics’ auditor is located in Hong Kong, Prenetics’ auditor is included on a list of audit firms the PCAOB determined it is unable to inspect or investigate completely because of a position taken by one or more authorities in Hong Kong, and is therefore subject to the PCAOB’s determination. Therefore PubCo could be delisted and its securities could be prohibited from being traded “over-the-counter” if it is identified as a Commission-Identified Issuer for three consecutive years. If PubCo’s securities are unable to be listed on another securities exchange by then, such a delisting or prohibition of trading would substantially impair your ability to sell or purchase PubCo’s securities when you wish to do so, and the risk and uncertainty associated with a potential delisting or prohibition of trading would have a negative impact on the price of PubCo’s securities. The Accelerating Holding Foreign Companies Accountable Act, passed by the U.S. Senate and if enacted, would require foreign companies to comply with the PCAOB audits within two consecutive years instead of three consecutive years. In light of the PRC government’s recent expansion of authority in Hong Kong, there are risks and uncertainties which Prenetics cannot foresee for the time being, and rules and regulations in China can change quickly with little or no advance notice. The PRC government may intervene or influence our current and future operations in Hong Kong and mainland China at any time, or may exert more control over offerings conducted overseas and/or foreign investment in companies like Prenetics or Prenetics HK. For a detailed description of risks relating to doing business in Hong Kong, see “Risk Factors — Risks Related to Doing Business in Hong Kong.”
In February 2019, Prenetics HK invested in a genomics business in mainland China in the amount of RMB29,250,000 (equivalent to $4,236,765) through its VIE Entity. Since the date of the initial investment through the date of this proxy statement/prospectus, no transfer of cash, dividends or distributions has been made between Prenetics or its subsidiaries, on one hand, and the VIE Entity, on the other. Between Prenetics HK and its subsidiaries, the cash was transferred from Prenetics HK to its subsidiaries in the form of capital contributions and through intercompany advances. No transfer of cash has been made between Prenetics and its subsidiaries. Neither Prenetics HK nor Prenetics has declared or paid dividends in the past, nor have any dividends or distributions been made by a subsidiary to Prenetics HK or Prenetics. If needed, cash may be transferred between Prenetics HK and its subsidiaries in the United Kingdom, India and South Africa through intercompany fund advances and capital contributions, and there are currently no restrictions of transferring funds between Prenetics HK and its subsidiaries in the United Kingdom, India and South Africa. However, there also can be no assurance that the PRC government will not intervene or impose restrictions on Prenetics Group’s ability to transfer or distribute cash within its organization, which could result in an inability or prohibition on making transfers or distributions to entities outside of Hong Kong and adversely affect its business. Under Prenetics Group’s cash management policy, the amount of intercompany transfer of funds is determined based on the working capital needs of the subsidiaries and intercompany transactions and is subject to internal approval process and funding arrangements. Prenetics Group’s management reviews and monitors its cash flow forecast and working capital needs of the subsidiaries on a regular basis. In addition, Prenetics Group has not faced difficulties or limitations on its ability to transfer cash between subsidiaries in United Kingdom, India, Singapore and South Africa. Cash generated from Prenetics HK is used to fund operations of its subsidiaries, and no funds were transferred from our subsidiaries in the United Kingdom to fund operations of Prenetics HK for the year ended on December 31, 2019, December 31, 2020, and December 31, 2021. For a detailed description of the intercompany transfer of cash within Prenetics Group, please see “Prenetics’ Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources.” See also “Selected Historical Financial Data of Prenetics” for the condensed consolidating schedules for Prenetics, Prenetics HK, WFOE, the VIE Entity and other subsidiaries of Prenetics Group, respectively, starting from page 47 of this proxy statement/prospectus, and the audited consolidated financial statements of Prenetics and its subsidiaries for the years ended December 31, 2021, 2020 and 2019 starting from page F-3 of this proxy statement/prospectus.
Pursuant to the Business Combination Agreement, upon the consummation of the Initial Merger: (i) each of Artisan’s units (“Units”) (each consisting of one Class A ordinary share, par value $0.0001 per share, of Artisan (‘‘Artisan Public Shares’’) and one-third of one Artisan Public Warrant) issued and outstanding immediately prior to the effective time of the Initial Merger (the “Initial Merger Effective Time”) shall be automatically separated and the holder thereof shall be deemed to hold one Artisan Public Share and one-third of an Artisan Public Warrant; provided, that, no fractional Artisan Public Warrants shall be issued in connection with such separation such that if a holder of such Units would be entitled to receive a fractional Artisan Public Warrant upon such separation, the number of Artisan Public Warrants to be issued to such holder upon such separation will be rounded down to the nearest whole number of Artisan Public Warrants and no cash will be paid in lieu of such fractional Artisan Public Warrants; (ii) immediately following the separation of each Unit, each Artisan Public Share (which, for the avoidance of doubt, includes the Artisan Public Shares held as a result of the separation of the Units and Artisan Public Shares issued in the Class B Recapitalization (as defined below)) issued and outstanding immediately prior to the Initial Merger Effective Time (excluding Artisan Public Shares that are held by Artisan shareholders that validly exercise their redemption rights, Artisan Public Shares that are held by Artisan shareholders that exercise and perfect their relevant dissenters’ rights and Artisan treasury shares) shall be cancelled in exchange for the right to receive the number of newly issued PubCo Class A Ordinary Shares equal to the Class A Exchange Ratio (as defined below); and (iii) each whole warrant of Artisan outstanding immediately prior to the Initial Merger Effective Time shall cease to be a warrant with respect to Artisan Public Shares and be assumed by PubCo and converted into a warrant to purchase such number of PubCo Class A Ordinary Share equal to the Class A Exchange Ratio, subject to substantially the same terms and conditions prior to the Initial Merger Effective Time.
In addition, pursuant to the Business Combination Agreement, upon the consummation of the Acquisition Merger: (i) each ordinary share, par value $0.0001 per share of Prenetics (“Prenetics Ordinary Shares”) and each preferred share, par value $0.0001 per share of Prenetics (“Prenetics Preferred Shares” and collectively with Prenetics Ordinary Shares, “Prenetics Shares”) (excluding Prenetics Shares that are held by Prenetics shareholders that exercise and perfect their relevant dissenters’ rights, Prenetics Shares held by Danny Yeung (“Prenetics Key Executive Shares”) and Prenetics treasury shares) issued and outstanding immediately prior to the effective time of the Acquisition Merger (the “Acquisition Effective Time”) shall be cancelled in exchange for the right to receive such fraction of a newly issued PubCo Class A Ordinary Share that is equal to the Exchange Ratio (defined below), without interest, subject to rounding up to the nearest whole PubCo Class A Ordinary Share with respect to the total number of PubCo Class A Ordinary Shares to be received by each Prenetics shareholder ; and (ii) each of the Prenetics Key Executive Shares issued and outstanding immediately prior to the Acquisition Merger Time shall be cancelled in exchange for the right to receive such fraction of a newly issued convertible Class B ordinary share, par value $0.0001 per share of Pubco (“PubCo Class B Ordinary Shares” and collectively with PubCo Class A Ordinary Shares, “PubCo Ordinary Shares”) that is equal to the Exchange Ratio without interest, subject to rounding up to the nearest whole PubCo Class B Ordinary Share with respect to the total number of PubCo Class B Ordinary Shares to be received by Danny Yeung. The newly issued PubCo Class B Ordinary Shares will have the same economic terms as the newly issued PubCo Class A Ordinary Shares, but each PubCo Class B Ordinary Share will, among other rights, be entitled to twenty (20) votes per share compared with one (1) vote per share for PubCo Class A Ordinary Shares with all PubCo Ordinary Shares voting together as a single class on most matters. See “Description of PubCo Securities.” Mr. Yeung will beneficially own all of the issued PubCo Class B Ordinary Shares immediately following the consummation of the Business Combination.
In connection with and concurrently with the execution of the BCA Amendment, Prenetics, Artisan and PubCo entered into a Sponsor Forfeiture and Conversion Agreement (the “Sponsor Agreement”) with the Sponsor and the Artisan independent directors, pursuant to and subject to the terms of which, among other things, immediately prior to the consummation of the Initial Merger, Sponsor and the Artisan independent directors shall contribute, transfer, assign, convey and deliver to Artisan all of their respective right, title and interest in, to and under the Class B ordinary shares, par value of $0.0001 per share, of Artisan (each a “Founder Share”, and together with an Artisan Public Share, each an “Artisan Share”) held by them in exchange for Artisan Public Shares, and the Sponsor will also surrender and forfeit certain Private Placement Warrants for no consideration. In connection with the foregoing and immediately prior to the consummation of the Initial Merger, (i) all 9,133,558 outstanding Founder Shares held by Sponsor shall be exchanged and converted into the number of Artisan Public Shares equal to (x) 6,933,558, divided by (y) the Class A Exchange Ratio; (ii) the aggregate of 100,000 outstanding Founder Shares held by the Artisan independent directors shall be exchanged and converted into the number of Artisan Public Shares equal to (x) 100,000, divided by (y) the Class A Exchange Ratio; and (iii) the Sponsor shall automatically irrevocably surrender and forfeit to Artisan for no consideration, as a contribution to capital, such number of Private Placement Warrants equal to (x) 5,857,898 minus (y) the quotient obtained by dividing 5,857,898 by the Class A Exchange Ratio.
Substantially concurrently with the execution and delivery of the Business Combination Agreement, Artisan’s Forward Purchase Agreements dated March 1, 2021 were amended by the Deeds of Novation and Amendment as of September 15, 2021, and pursuant to such Deeds of Novation and Amendment, (i) Aspex Master Fund, an exempted company incorporated under the laws of the Cayman Islands, has agreed to purchase 3,000,000 PubCo Class A Ordinary Shares and 750,000 PubCo Warrants for an aggregate price equal to $30,000,000 immediately prior to the Acquisition Effective Time and (ii) Pacific Alliance Asia Opportunity Fund L.P., an exempted limited partnership formed under the laws of the Cayman Islands (together with Aspex Master Fund, the “Forward Purchase Investors”) has agreed to purchase 3,000,000 PubCo Class A Ordinary Shares and 750,000 PubCo Warrants for an aggregate price equal to $30,000,000 immediately prior to the Acquisition Effective Time.
In connection with and concurrently with the execution of the BCA Amendment, Artisan, PubCo and Sponsor entered into a Deed of Amendment to Deed of Novation and Amendment (each a “Deed of Amendment to Deed of Novation and Amendment”) with each of the Forward Purchase Investors,
respectively, pursuant to which, among other things, (i) the number of PubCo Class A Ordinary Shares to be purchased by each Forward Purchase Investor immediately prior to the Acquisition Effective Time is increased by multiplying (a) the number of PubCo Class A Ordinary Shares that such Forward Purchase Investor has agreed to purchase under the relevant Amended Forward Purchase Agreement by (b) the Class A Exchange Ratio, without additional consideration payable by such Forward Purchase Investor; (ii) the lock-up period applicable to such Forward Purchase Investor is to be amended to six months after the consummation of the Business Combination, subject to earlier release if certain criteria are met; and (iii) such Forward Purchase Investor shall convert all Founder Shares held by it into Artisan Public Shares on a one-for-one basis immediately prior to the Initial Closing.
Upon the consummation of the Business Combination, PubCo will become a “controlled company” as defined under the NASDAQ corporate governance rules, because it is expected that Mr. Yeung will beneficially own approximately 59.97% of the total voting power of all issued and outstanding PubCo Ordinary Shares immediately following the consummation of the Business Combination, assuming that (i) no shareholders of Artisan elect to have their Artisan Public Shares redeemed for cash in connection with the Business Combination as permitted by Artisan’s amended and restated memorandum and articles of association (the “No Redemption Scenario”); (ii) no Artisan shareholder exercises its dissenters’ rights; (iii) no Prenetics shareholder exercise its dissenters’ rights; and (iv) no shares underlying Prenetics’ outstanding restricted share units will be issued upon consummation of the Business Combination. Under these assumptions, holders of Artisan Public Shares, Prenetics shareholders (excluding Mr. Yeung), the Forward Purchase Investors, the PIPE Investors, Sponsor and certain Artisan directors and Mr. Yeung will beneficially own 26.51%, 51.51%, 5.27%, 4.69%, 5.05% and 6.97%, respectively, of the total economic interest in PubCo, and will hold 11.40%, 22.17%, 2.27%, 2.02%, 2.17% and 59.97%, respectively, of the total voting power of all issued and outstanding PubCo Ordinary Shares, in each case immediately following the consummation of the Business Combination. If the actual facts differ from these assumptions set forth above, these percentages will be different.
The sum of all PubCo Class A Ordinary Shares receivable by Artisan shareholders at the Initial Closing is referred to as “Initial Merger Consideration.” The sum of all the PubCo Ordinary Shares and other securities receivable by Prenetics shareholders at Closing is referred to as “Acquisition Merger Consideration.” The Initial Merger Consideration and the Acquisition Merger Consideration are collectively referred to as the “Shareholder Merger Consideration.” Assuming: (i) the No Redemption Scenario; (ii) no Artisan shareholder exercises its dissenters’ rights; (iii) no Prenetics shareholder exercise its dissenters’ rights; and (iv) no shares underlying Prenetics’ outstanding restricted share units will be issued upon consummation of the Business Combination, the Initial Merger Consideration, the Acquisition Merger Consideration and the Shareholder Merger Consideration consist of 44,784,098, 81,495,261 and 126,279,359 PubCo Ordinary Shares, respectively, or $ , $ and $ , respectively, based upon a closing price of $ per Artisan Public Share on NASDAQ on the assumed Closing Date. If the actual facts differ from these assumptions set forth above, these figures will be different.
Proposals to approve the Business Combination Agreement and the other matters discussed in this proxy statement/prospectus shall be presented at the Extraordinary General Meeting of shareholders of Artisan scheduled to be held on , 2022.
This proxy statement/prospectus provides you with detailed information about the Business Combination and other matters to be considered at the Extraordinary General Meeting of Artisan shareholders. We encourage you to carefully read this entire document. You should, in particular, carefully consider the risk factors described in “Risk Factors” beginning on page 66 of this proxy statement/prospectus.
The board of directors of Artisan (the “Artisan Board”) has unanimously approved and adopted the Business Combination Agreement and unanimously recommends that the Artisan shareholders vote FOR all of the proposals presented to the shareholders at the Extraordinary General Meeting. When you consider the Artisan Board’s recommendation of these proposals, you should keep in mind that Artisan’s directors and officer have interests in the Business Combination that may conflict with your interests as a shareholder. See “The Business Combination Proposal — Interests of Artisan’s Directors and Officer in the Business Combination.”
This proxy statement/prospectus is dated , 2022 and is first being mailed to Artisan shareholders on or about , 2022.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THIS PROXY STATEMENT/PROSPECTUS OR ANY OF THE SECURITIES TO BE ISSUED IN THE BUSINESS COMBINATION, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.
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ADDITIONAL INFORMATION
No person is authorized to give any information or to make any representation with respect to the matters that this proxy statement/prospectus describes other than those contained in this proxy statement/ prospectus, and, if given or made, the information or representation must not be relied upon as having been authorized by PubCo, Artisan or Prenetics. This proxy statement/prospectus does not constitute an offer to sell or a solicitation of an offer to buy securities or a solicitation of a proxy in any jurisdiction where, or to any person to whom, it is unlawful to make such an offer or a solicitation. Neither the delivery of this proxy statement/prospectus nor any distribution of securities made under this proxy statement/prospectus will, under any circumstances, create an implication that there has been no change in the affairs of PubCo, Artisan or Prenetics since the date of this proxy statement/prospectus or that any information contained herein is correct as of any time subsequent to such date.
PRELIMINARY — SUBJECT TO COMPLETION, DATED MARCH 30, 2022
ARTISAN ACQUISITION CORP.
71 Fort Street, PO Box 500
Grand Cayman, Cayman Islands
71 Fort Street, PO Box 500
Grand Cayman, Cayman Islands
Dear Artisan Acquisition Corp. Shareholders:
You are cordially invited to attend the extraordinary general meeting of shareholders (the “Extraordinary General Meeting”) of Artisan Acquisition Corp., an exempted company limited by shares incorporated under the laws of the Cayman Islands (“Artisan”), at AM time, on , 2022 at and virtually over the Internet via live audio webcast at https://www.cstproxy.com/artisanacquisition/2022, and on such other date and at such other place to which the meeting may be adjourned. While as a matter of Cayman Islands law we are required to have a physical location for the meeting, we are pleased to utilize virtual shareholder meeting technology to (i) provide ready access and cost savings for Artisan shareholders and Artisan and (ii) to promote social distancing pursuant to guidance provided by the SEC due to COVID-19. We encourage shareholders to attend the Extraordinary General Meeting virtually. The virtual meeting format allows attendance from any location in the world. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the accompanying proxy statement/prospectus.
The Extraordinary General Meeting shall be held for the following purpose:
1.
to consider and vote upon a proposal, which is referred to herein as the “Business Combination Proposal,” to approve and authorize, the business combination and other transactions contemplated by the Business Combination Agreement, dated September 15, 2021 (as amended by an Amendment to Business Combination Agreement dated as of March 30, 2022 (the “BCA Amendment”) and as may be further amended, supplemented or otherwise modified from time to time, the “Business Combination Agreement”), by and among Prenetics Global Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands (“PubCo”), Artisan, AAC Merger Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a direct wholly-owned subsidiary of PubCo (“Artisan Merger Sub”), PGL Merger Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a direct wholly-owned subsidiary of PubCo (“Prenetics Merger Sub”) and Prenetics Group Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands (“Prenetics”). The Business Combination Agreement is attached to the accompanying proxy statement/prospectus as Annex A;
2.
to consider and vote upon a proposal to approve and authorize, assuming the Business Combination Proposal is approved and adopted, the Initial Merger and the Plan of Initial Merger by and among Artisan, Artisan Merger Sub and PubCo, substantially in the form attached as Exhibit F to the Business Combination Agreement (the “Initial Merger Proposal”); and
3.
to consider and vote upon, if presented, a proposal to adjourn the Extraordinary General Meeting to a later date or dates to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the Extraordinary General Meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote or if holders of Artisan Public Shares, have elected to redeem an amount of Artisan Public Shares such that the minimum available cash condition contained in the Business Combination Agreement would not be satisfied (the “Adjournment Proposal”).
The Business Combination Proposal and, if presented, the Adjournment Proposal shall require approval by the Artisan shareholders as an ordinary resolution. The Initial Merger Proposal shall require approval by the Artisan shareholders as a special resolution. Only holders of record of Artisan Shares at the close of business on , 2022 (the “record date”) are entitled to notice of the Extraordinary General Meeting and to vote at the Extraordinary General Meeting and any adjournments or postponements of the Extraordinary General Meeting.
As further described in the accompanying proxy statement/prospectus, subject to the terms and conditions of the Business Combination Agreement, the following transactions will occur:
1.
(i) Artisan shall merge with and into Artisan Merger Sub, with Artisan Merger Sub being the surviving entity and remaining as a wholly-owned subsidiary of PubCo and (ii) following the Initial Merger, Prenetics Merger Sub shall merge with and into Prenetics, with Prenetics being the surviving entity and becoming a wholly-owned subsidiary of PubCo; and
2.
(i) each of the Units (each consisting of one Artisan Public Share and one-third of one Artisan Public Warrant) issued and outstanding immediately prior to the Initial Merger Effective Time shall be automatically separated and the holder thereof shall be deemed to hold one Artisan Public Share and one-third of an Artisan Public Warrant; provided that, no fractional Artisan Public Warrants shall be issued in connection with such separation such that if a holder of such Units would be entitled to receive a fractional Artisan Public Warrant upon such separation, the number of Artisan Public Warrants to be issued to such holder upon such separation will be rounded down to the nearest whole number of Artisan Public Warrants and no cash will be paid in lieu of such fractional Artisan Public Warrants; (ii) immediately following the separation of each Unit, each Artisan Share (excluding Artisan Public Shares that are held by Artisan shareholders that validly exercise their redemption rights, Artisan Shares that are held by Artisan shareholders that exercise and perfect their relevant dissenters’ rights and Artisan treasury shares) issued and outstanding immediately prior to the effective time of the Initial Merger shall be cancelled in exchange for the right to receive the number of newly issued PubCo Class A Ordinary Shares equal to the lower of: (A) 1.29; and (B) (1) (x) the Post-Redemption SPAC Share Number (as defined below), plus, (y) 3,000,000 divided by (2) the Post- Redemption SPAC Share Number (the lower of (A) and (B), the “Class A Exchange Ratio”); and (iii) each whole warrant of Artisan outstanding immediately prior to the Initial Merger Effective Time shall cease to be a warrant with respect to Artisan Public Shares and be assumed by PubCo and converted into a warrant to purchase such number of PubCo Class A Ordinary Share equal to the Class A Exchange Ratio, subject to substantially the same terms and conditions prior to the Initial Merger Effective Time.
3.
(i) each Prenetics Share (excluding Prenetics Shares that are held by Prenetics shareholders that exercise and perfect their relevant dissenters’ rights, Prenetics Key Executive Shares and Prenetics treasury shares) issued and outstanding immediately prior to the Acquisition Effective Time shall be cancelled in exchange for the right to receive such fraction of a newly issued PubCo Class A Ordinary Share that is equal to the Exchange Ratio without interest subject to rounding; and (ii) each of the Prenetics Key Executive Shares issued and outstanding immediately prior to the Acquisition Effective Time shall be cancelled in exchange for the right to receive such fraction of a newly issued PubCo Class B Ordinary Share that is equal to the Exchange Ratio without interest subject to rounding.
Substantially concurrently with the execution and delivery of the Business Combination Agreement, Artisan’s Forward Purchase Agreements dated March 1, 2021 were amended by the Deeds of Novation and Amendment and restated as of September 15, 2021, and pursuant to such Deeds of Novation and Amendment, (i) Aspex Master Fund, an exempted company incorporated under the laws of the Cayman Islands, has agreed to purchase 3,000,000 PubCo Class A Ordinary Shares and 750,000 PubCo Warrants for an aggregate price equal to $30,000,000 immediately prior to the Acquisition Effective Time and (ii) Pacific Alliance Asia Opportunity Fund L.P., an exempted limited partnership formed under the laws of the Cayman Islands has agreed to purchase 3,000,000 PubCo Class A Ordinary Shares and 750,000 PubCo Warrants for an aggregate price equal to $30,000,000 immediately prior to the Acquisition Effective Time. In connection with and concurrently with the execution of the BCA Amendment, Artisan, PubCo and Sponsor entered into a Deed of Amendment to Deed of Novation and Amendment (each a “Deed of Amendment to Deed of Novation and Amendment”) with each of the Forward Purchase Investors, respectively, pursuant to which, among other things, (i) the number of PubCo Class A Ordinary Shares to be purchased by each Forward Purchase Investor immediately prior to the Acquisition Effective Time is increased by multiplying (a) the number of PubCo Class A Ordinary Shares that such Forward Purchase Investor has agreed to purchase under the relevant Amended Forward Purchase Agreement by (b) the Class A Exchange Ratio, without additional consideration payable by such Forward Purchase Investor; (ii) the lock-up period applicable to such Forward Purchase Investor is to be amended to six months after the consummation of the Business Combination, subject to earlier release if certain criteria are met; and (iii) such Forward
Purchase Investor shall convert all Founder Shares held by it into Artisan Public Shares on a one-for-one basis immediately prior to the Initial Closing.
Concurrently with the execution of the Business Combination Agreement, certain PIPE Investors have entered into share subscription agreements (“PIPE Subscription Agreements”), pursuant to which the PIPE Investors agreed to subscribe for and purchase PubCo Class A Ordinary Shares at $10.00 per share for an aggregate purchase price of $60,000,000 (the “PIPE Investment”). In connection with and concurrently with the execution of the BCA Amendment, Artisan and PubCo entered into an Amendment Agreement (each an “Amendment to PIPE Subscription Agreement”) with each of the PIPE Investors, respectively, pursuant to which the number of PubCo Class A Ordinary Shares to be purchased by each PIPE Investor immediately prior to the Acquisition Effective Time is increased by multiplying (a) the number of PubCo Class A Ordinary Shares that such PIPE Investor has agreed to purchase under the relevant PIPE Subscription Agreement by (b) the Class A Exchange Ratio, without additional consideration payable by such PIPE Investor.
Under the Business Combination Agreement, the approval of the Business Combination Proposal and the Initial Merger Proposal by the requisite vote of Artisan shareholders is a condition to the consummation of the Business Combination. If either of these proposals is not approved by Artisan shareholders, the Business Combination shall not be consummated.
The Adjournment Proposal, if adopted, shall allow the chairman of the Extraordinary General Meeting to adjourn the Extraordinary General Meeting to a later date or dates, if necessary. In no event shall Artisan solicit proxies to adjourn the Extraordinary General Meeting or consummate the Business Combination and related transactions beyond the date by which it may properly do so under Artisan’s amended and restated memorandum and articles of association (the “Artisan Articles”) and the Companies Act (As Revised) of the Cayman Islands (the “Cayman Islands Companies Act”). The purpose of the Adjournment Proposal is to provide more time to meet the requirements that are necessary to consummate the Business Combination and related transactions. The Adjournment Proposal is not conditioned upon the approval of any other proposal set forth in the accompanying proxy statement/prospectus.
Each of these proposals is more fully described in the accompanying proxy statement/prospectus, which each shareholder is encouraged to read carefully and in its entirety.
In connection with the Business Combination, certain related agreements have been entered into prior to the closing of the Business Combination, including the PIPE Subscription Agreements, the Amendments to PIPE Subscription Agreements, the Prenetics Shareholder Support Agreements, the Shareholder Support Agreement Joinder, the Management Shareholder Support Agreement Amendment Deed, the Sponsor Support Agreement, the Sponsor Support Agreement Amendment Deed, the Sponsor Agreement, the Registration Rights Agreement, the Assignment, Assumption and Amendment Agreement, the Deeds of Novation and Amendment and the Deeds of Amendment to Deeds of Novation and Amendment (each as defined in the accompanying proxy statement/prospectus). See “Agreements Entered Into in Connection with the Business Combination” in the accompanying proxy statement/prospectus for more information.
Pursuant to the Artisan Articles, a holder (“Artisan Public Shareholder”) of Artisan Public Shares issued as part of the Units in Artisan’s initial public offering (“IPO”) may request that Artisan redeem all or a portion of such Artisan Public Shares for cash in connection with the completion of the Business Combination. Holders of Units must elect to separate the Units into the underlying Artisan Public Shares and Artisan Public Warrants prior to exercising redemption rights with respect to the Artisan Public Shares. If holders hold their Units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the Units into the underlying Artisan Public Shares and Artisan Public Warrants, or if a holder holds Units registered in its own name, the holder must contact Continental, directly and instruct it to do so. The redemption rights include the requirement that a beneficial holder must identify itself in writing as a beneficial holder and provide its legal name, phone number and address to Continental in order to validly redeem its shares. Artisan Public Shareholders are not required to affirmatively vote for or against the Business Combination Proposal, to vote on the Business Combination Proposal at all, or to be holders of record on the record date in order to have their Artisan Public Shares redeemed. If the Business Combination is not consummated, the Artisan Public Shares will not be redeemed and will instead be returned to the respective holder, broker or bank. In such case, Artisan shareholders may only share in
the assets of the trust account upon the liquidation of Artisan. This may result in Artisan shareholders receiving less than they would have received if the Business Combination was completed and they had exercised redemption rights in connection therewith due to potential claims of creditors. If the Business Combination is consummated, and if an Artisan Public Shareholder properly exercises its right to redeem all or a portion of the Artisan Public Shares that it holds, Artisan will redeem such Artisan Public Shares for a per-share price, payable in cash, equal to the pro rata portion of the amount on deposit in the trust account calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the funds held in the trust account and not previously released to Artisan to pay income taxes (less up to $100,000 of interest to pay dissolution expenses). For illustrative purposes, as of , 2022, this would have amounted to approximately $ per issued and outstanding Artisan Public Share. If an Artisan Public Shareholder exercises its redemption rights in full, then it will be electing to exchange its Artisan Public Shares for cash and will no longer own Artisan Public Shares (but will continue to own any Artisan Public Warrants it may hold). See “Extraordinary General Meeting of Artisan Shareholders — Redemption Rights” in the accompanying proxy statement/prospectus for a detailed description of the procedures to be followed if you wish to redeem your Artisan Public Shares for cash.
Notwithstanding the foregoing, an Artisan Public Shareholder, together with any affiliate of such Artisan Public Shareholder or any other person with whom such Artisan Public Shareholder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (“Exchange Act”)), will be restricted from seeking redemption rights with respect to more than an aggregate of 15% of the Artisan Public Shares without the prior consent of Artisan. Accordingly, if an Artisan Public Shareholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the Artisan Public Shares, then any such shares in excess of that 15% limit would not be redeemed for cash.
The Sponsor has agreed to, among other things, vote all of their Artisan Shares in favor of the proposals being presented at the Extraordinary General Meeting in connection with the Business Combination and waive their redemption rights with respect to their Artisan Shares in connection with the consummation of the Business Combination. The Forward Purchase Investors have also agreed to, among other things, vote all of their Artisan Shares in favor of the proposals being presented at the Extraordinary General Meeting in connection with the Business Combination and waive their redemption rights with respect to all of the Founder Shares held by them in connection with the consummation of the Business Combination. As of the date of this proxy statement/prospectus, on an as-converted basis, the Sponsor, Artisan directors and the Forward Purchase Investors own, collectively, approximately 22.73% of the issued and outstanding Artisan Shares.
The Business Combination Agreement is subject to the satisfaction or waiver of certain other closing conditions as described in the accompanying proxy statement/prospectus. There can be no assurance that the parties to the Business Combination Agreement would waive any such closing condition. In addition, in no event will Artisan redeem Artisan Public Shares in an amount that would cause Artisan’s net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) to be less than $5,000,001 after giving effect to the transactions contemplated by the Business Combination Agreement and PIPE Financing.
Artisan is providing the accompanying proxy statement/prospectus and accompanying proxy card to Artisan shareholders in connection with the solicitation of proxies to be voted at the Extraordinary General Meeting and at any adjournments or postponements of the Extraordinary General Meeting. Information about the Extraordinary General Meeting, the Business Combination and other related business to be considered by Artisan shareholders at the Extraordinary General Meeting is included in the accompanying proxy statement/prospectus. Whether or not you plan to attend the Extraordinary General Meeting, all of Artisan shareholders should read the accompanying proxy statement/prospectus, including the Annexes and other documents referred to therein, carefully and in their entirety. You should also carefully consider the risk factors described in “Risk Factors” beginning on page 51 of the accompanying proxy statement/prospectus.
After careful consideration, the Artisan Board has unanimously approved the Business Combination and determined that the Business Combination Proposal, the Initial Merger Proposal and the Adjournment Proposal are advisable and fair to and in the best interest of Artisan and unanimously recommends that you vote or give instruction to vote “FOR” the Business Combination Proposal, “FOR” the Initial Merger Proposal and “FOR” the Adjournment Proposal, if presented. When you consider the Artisan Board’s recommendation of these
proposals, you should keep in mind that our directors and our officer have interests in the Business Combination that may conflict with, or are different from, your interests as a shareholder of Artisan. See “The Business Combination Proposal — Interests of Artisan’s Directors and Officer in the Business Combination.” in the accompanying proxy statement/prospectus for a further discussion of these considerations.
The approval of the Business Combination Proposal will require an ordinary resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of a majority of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting. The approval of the Initial Merger Proposal will require a special resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of at least two-thirds of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting. The approval of the Adjournment Proposal, if presented, will require an ordinary resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of a majority of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting. Brokers are not entitled to vote on the Business Combination Proposal, the Initial Merger Proposal or the Adjournment Proposal absent voting instructions from the beneficial holder. An abstention or broker non-vote will be counted towards the quorum requirement but will not count as a vote cast at the Extraordinary General Meeting.
Your vote is important regardless of the number of Artisan Shares you own. Whether or not you plan to attend the Extraordinary General Meeting, please complete, sign, date and return the enclosed proxy card as soon as possible in the pre-addressed postage paid envelope provided and in any event so as to be received by Artisan no later than at AM time, on , 2022, being 48 hours before the time appointed for the holding of the Extraordinary General Meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting) to make sure that your Artisan Shares are represented at the Extraordinary General Meeting. If your Artisan Shares are held in “street name” or are in a margin or similar account, you should contact your broker, bank or nominee to ensure that votes related to the Artisan Shares you beneficially own are properly counted. The Business Combination will be consummated only if the Business Combination Proposal and the Initial Merger Proposal are approved at the Extraordinary General Meeting. The Adjournment Proposal is not conditioned upon the approval of any other proposal set forth in the accompanying proxy statement/prospectus.
If you sign, date and return your proxy card without indicating how you wish to vote, your proxy will be voted FOR each of the proposals presented at the Extraordinary General Meeting. If you are a shareholder of record and fail to return your proxy card and do not attend the Extraordinary General Meeting in person (including virtually), or if you fail to instruct your bank, broker or other nominee how to vote the Artisan Shares you beneficially own, the effect will be, among other things, that your Artisan Shares will not be counted for purposes of determining whether a quorum is present at the Extraordinary General Meeting and will not be voted.
TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST DEMAND IN WRITING THAT ARTISAN REDEEM YOUR ARTISAN PUBLIC SHARES FOR A PRO RATA PORTION OF THE FUNDS HELD IN THE TRUST ACCOUNT AND EITHER TENDER YOUR SHARE CERTIFICATES (IF ANY) TO CONTINENTAL STOCK TRANSFER & TRUST COMPANY, ARTISAN’S TRANSFER AGENT OR DELIVER YOUR ARTISAN PUBLIC SHARES TO THE TRANSFER AGENT ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT WITHDRAWAL AT CUSTODIAN) SYSTEM, IN EACH CASE AT LEAST TWO BUSINESS DAYS PRIOR TO THE VOTE AT THE EXTRAORDINARY GENERAL MEETING. ANY HOLDER THAT HOLDS ARTISAN PUBLIC SHARES BENEFICIALLY THROUGH A NOMINEE MUST IDENTIFY ITSELF AS A BENEFICIAL HOLDER AND PROVIDE ITS LEGAL NAME, PHONE NUMBER AND ADDRESS IN ITS WRITTEN DEMAND IN ORDER TO VALIDLY REDEEM SUCH SHARES. IF THE BUSINESS COMBINATION IS NOT COMPLETED, THEN THESE SHARES SHALL BE RETURNED TO YOU OR YOUR ACCOUNT. IF YOU HOLD YOUR ARTISAN PUBLIC SHARES IN “STREET NAME”, YOU NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BROKER, BANK OR OTHER NOMINEE TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN
ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. SEE “EXTRAORDINARY GENERAL MEETING OF ARTISAN SHAREHOLDERS — REDEMPTION RIGHTS” FOR MORE SPECIFIC INSTRUCTIONS.
If you have any questions or need assistance voting your Artisan Shares, please contact Artisan’s legal department by email at kirsten.gao@c-venturesfund.com.
On behalf of Artisan’s board of directors, I would like to thank you for your support and look forward to the successful completion of the Business Combination.
| | | | | Sincerely, | |
| | | | |
Cheng Yin Pan
Chief Executive Officer and Director |
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT/PROSPECTUS, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THE ACCOMPANYING PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.
The accompanying proxy statement/prospectus is dated , 2022, and is first being mailed to shareholders of Artisan on or about , 2022.
ARTISAN ACQUISITION CORP.
NOTICE OF EXTRAORDINARY GENERAL MEETING
TO BE HELD ON , 2022
NOTICE OF EXTRAORDINARY GENERAL MEETING
TO BE HELD ON , 2022
TO THE SHAREHOLDERS OF ARTISAN ACQUISITION CORP.:
NOTICE IS HEREBY GIVEN that an extraordinary general meeting of shareholders (the “Extraordinary General Meeting”) of Artisan Acquisition Corp., an exempted company limited by shares incorporated under the laws of the Cayman Islands (“Artisan”), shall be held at AM time, on , 2022 at and virtually over the Internet via live audio webcast at https://www.cstproxy.com/artisanacquisition/2022, and on such other date and at such other place to which the meeting may be adjourned. Due to health concerns stemming from the COVID 19 pandemic, and to support the health and well-being of our shareholders, we encourage shareholders to attend the Extraordinary General Meeting virtually. You are cordially invited to attend the Extraordinary General Meeting, to conduct the following items of business and consider, and if thought fit, approve the following resolutions:
1)
Proposal No. 1 — the Business Combination Proposal
“RESOLVED, as an ordinary resolution, that the business combination and other transactions contemplated by the Business Combination Agreement, dated as of September 15, 2021 (as amended by an Amendment to Business Combination Agreement dated as of March 30, 2022 (the “BCA Amendment”) and as may be further amended, supplemented or otherwise modified from time to time, the “Business Combination Agreement”), by and among Prenetics Global Limited (“PubCo”), Artisan Acquisition Corp. (“Artisan”), AAC Merger Limited (“Artisan Merger Sub”), PGL Merger Limited (“Prenetics Merger Sub”) and Prenetics Group Limited (“Prenetics”) pursuant to which among other things, Artisan shall merge with and into Artisan Merger Sub, with Artisan Merger Sub being the surviving entity and remaining as a wholly-owned subsidiary of PubCo (the “Initial Merger”) and following the Initial Merger, Prenetics Merger Sub shall merge with and into Prenetics, with Prenetics being the surviving entity and becoming a wholly-owned subsidiary of PubCo, and Artisan’s entry into the Business Combination Agreement and the BCA Amendment each be and are hereby confirmed, ratified, authorized and approved in all respects.”
2)
Proposal No. 2 — the Initial Merger Proposal
“RESOLVED, as a special resolution, that the Plan of Merger (the “Plan of Initial Merger”), by and among Artisan Acquisition Corp. (“Artisan”), AAC Merger Limited (“Artisan Merger Sub”) and Prenetics Global Limited (“PubCo”), substantially in the form attached as Exhibit F to the Business Combination Agreement, dated as of September 15, 2021, by and among PubCo, Artisan, Artisan Merger Sub, PGL Merger Limited and Prenetics Group Limited (as amended by an Amendment to Business Combination Agreement dated as of March 30, 2022 and as may be further amended, supplemented or otherwise modified from time to time) be and is hereby authorized and approved in all respects, that Artisan be and is hereby authorized to enter into the Plan of Initial Merger, and that the merger of Artisan with and into Artisan Merger Sub, with Artisan Merger Sub being the surviving entity and remaining as a wholly-owned subsidiary of PubCo be and is hereby authorized and approved in all respects.”
3)
Proposal No. 3 — the Adjournment Proposal
“RESOLVED, as an ordinary resolution, that the adjournment of the Extraordinary General Meeting to a later date or dates to be determined by the chairman of the Extraordinary General Meeting, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more proposals at the Extraordinary General Meeting or if shareholders have elected to redeem an amount of Class A ordinary shares such that the minimum available cash condition contained in the Business Combination Agreement, dated as of September 15, 2021, by and among Artisan Acquisition Corp., Prenetics Global Limited, AAC Merger Limited, PGL Merger Limited and Prenetics Group Limited (as amended by an Amendment
to Business Combination Agreement dated as of March 30, 2022 and as may be further amended, supplemented or otherwise modified from time to time) would not be satisfied, be and is hereby approved.”
We also will transact any other business as may properly come before the Extraordinary General Meeting or any adjournment or postponement thereof.
Under the Business Combination Agreement, the approval of the Business Combination Proposal and the Initial Merger Proposal by the requisite vote of Artisan shareholders is a condition to the consummation of the Business Combination. If either of these proposals is not approved by Artisan shareholders, the Business Combination shall not be consummated. The Adjournment Proposal is not conditioned on the approval of any other proposal listed above. The Business Combination is also subject to the satisfaction or waiver of certain other closing conditions as described in the accompanying proxy statement/prospectus. There can be no assurance that the parties to the Business Combination Agreement would waive any such provision of the Business Combination Agreement.
These items of business are more fully described in the accompanying proxy statement/prospectus, which we encourage you to read in its entirety before voting.
Only holders of record of Artisan ordinary shares (“Artisan Shares”) at the close of business on , 2022 (the “record date”) are entitled to notice of the Extraordinary General Meeting and to vote at the Extraordinary General Meeting and any adjournments or postponements of the Extraordinary General Meeting.
Whether or not you plan to attend the Extraordinary General Meeting, all of Artisan shareholders are urged to read the accompanying proxy statement/prospectus, including the Annexes and the documents referred to herein, carefully and in their entirety. You should also carefully consider the risk factors described in “Risk Factors” beginning on page 51 of the accompanying proxy statement/prospectus.
After careful consideration, the Artisan Board has unanimously approved the Business Combination and determined that the Business Combination Proposal, the Initial Merger Proposal and the Adjournment Proposal are advisable and fair to and in the best interest of Artisan and unanimously recommends that you vote or give instruction to vote “FOR” the Business Combination Proposal, “FOR” the Initial Merger Proposal and “FOR” the Adjournment Proposal, if presented. When you consider the Artisan Board’s recommendation of these proposals, you should keep in mind that our directors and our officer have interests in the Business Combination that may conflict with, or are different from, your interests as a shareholder of Artisan. See “The Business Combination Proposal — Interests of Artisan’s Directors and Officer in the Business Combination” in the accompanying proxy statement/prospectus for a further discussion of these considerations.
All Artisan shareholders at the close of business on the record date are cordially invited to attend the Extraordinary General Meeting, which shall be held at AM time, on , 2022 at and virtually over the Internet via live audio webcast at https://www.cstproxy.com/artisanacquisition/2022. To ensure your representation at the Extraordinary General Meeting, however, you are urged to complete, sign, date and return the enclosed proxy card as soon as possible in the pre-addressed postage paid envelope provided and in any event so as to be received by Artisan no later than at AM time, on , 2022, being 48 hours before the time appointed for the holding of the Extraordinary General Meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting). In the case of joint shareholders, where more than one of the joint shareholder purports to appoint a proxy, only the appointment submitted by the most senior holder (being the first named holder in respect of the shares in Artisan’s register of members) will be accepted. Submitting a proxy now will NOT prevent you from being able to attend and vote online during the virtual meeting. If you hold your Artisan Shares in “street name” or in a margin or similar account, which means your shares are held of record by a broker, bank or nominee, you must instruct your broker or bank on how to vote the Artisan Shares you beneficially own or, if you wish to attend the Extraordinary General Meeting and vote by means of remote communication, you must obtain a proxy from the shareholder of record and e-mail a copy (a legible photograph is sufficient) of your proxy to proxy@continentalstock.com no later than 72 hours prior to the Extraordinary General Meeting. Holders should contact their broker, bank or nominee for instructions regarding obtaining a legal
proxy. Holders who e-mail a valid legal proxy will be issued a meeting control number that will allow them to register to attend and participate in the Extraordinary General Meeting virtually. You will receive an e-mail prior to the meeting with a link and instructions for entering the Extraordinary General Meeting.
Voting on all resolutions at the Extraordinary General Meeting will be conducted by way of a poll rather than on a show of hands. On a poll, votes are counted according to the number of Artisan Shares registered in each shareholder’s name which are voted, with each Artisan Share carrying one vote.
Your vote is important regardless of the number of shares you own. Whether or not you plan to attend the Extraordinary General Meeting, please complete, sign, date, vote and return the enclosed proxy card as soon as possible and in any event so as to be received byArtisan no later than at AM time, on , 2022, being 48 hours before the time appointed for the holding of the Extraordinary General Meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting) in the pre-addressed postage paid envelope provided to make sure that your shares are represented at the Extraordinary General Meeting. In the case of joint shareholders, where more than one of the joint shareholder purports to appoint a proxy, only the appointment submitted by the most senior holder (being the first named holder in respect of the shares in Artisan’s register of members) will be accepted. Submitting a proxy now will NOT prevent you from being able to attend and vote online during the virtual meeting by following the procedure described above. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker or bank to ensure that votes related to the shares you beneficially own are properly counted.
If you have any questions or need assistance voting your Artisan Shares, please contact Artisan’s legal department by email at kirsten.gao@c-venturesfund.com.
Thank you for your participation. We look forward to your continued support.
By Order of the Board of Directors
Cheng Yin Pan
Chief Executive Officer and Director
Chief Executive Officer and Director
IF YOU RETURN YOUR SIGNED PROXY CARD WITHOUT AN INDICATION OF HOW YOU WISH TO VOTE, YOUR SHARES WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS PRESENTED AT THE EXTRAORDINARY GENERAL MEETING.
HOLDERS (“ARTISAN PUBLIC SHAREHOLDERS”) OF ARTISAN CLASS A ORDINARY SHARES ISSUED AS PART OF THE UNITS ISSUED IN ARTISAN’S INITIAL PUBLIC OFFERING (THE “ARTISAN PUBLIC SHARES”) HAVE THE RIGHT TO HAVE THEIR ARTISAN PUBLIC SHARES REDEEMED FOR CASH IN CONNECTION WITH THE PROPOSED BUSINESS COMBINATION. ARTISAN PUBLIC SHAREHOLDERS ARE NOT REQUIRED TO AFFIRMATIVELY VOTE FOR OR AGAINST THE BUSINESS COMBINATION PROPOSAL, TO VOTE ON THE BUSINESS COMBINATION PROPOSAL AT ALL, OR TO BE HOLDERS OF RECORD ON THE RECORD DATE IN ORDER TO HAVE THEIR ARTISAN PUBLIC SHARES REDEEMED FOR CASH. THIS MEANS THAT ANY ARTISAN PUBLIC SHAREHOLDER HOLDING ARTISAN PUBLIC SHARES MAY EXERCISE REDEMPTION RIGHTS REGARDLESS OF WHETHER THEY ARE EVEN ENTITLED TO VOTE ON THE BUSINESS COMBINATION PROPOSAL.
TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST DEMAND IN WRITING THAT ARTISAN REDEEM YOUR ARTISAN PUBLIC SHARES FOR A PRO RATA PORTION OF THE FUNDS HELD IN THE TRUST ACCOUNT AND EITHER TENDER YOUR SHARE CERTIFICATES (IF ANY) TO CONTINENTAL STOCK TRANSFER & TRUST COMPANY, ARTISAN’S TRANSFER AGENT, OR DELIVER YOUR ARTISAN PUBLIC SHARES TO THE TRANSFER AGENT ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT WITHDRAWAL AT CUSTODIAN) SYSTEM, IN EACH CASE AT LEAST TWO BUSINESS DAYS PRIOR TO THE VOTE AT THE EXTRAORDINARY GENERAL MEETING. ANY HOLDER THAT HOLDS ARTISAN PUBLIC SHARES BENEFICIALLY THROUGH A NOMINEE MUST IDENTIFY ITSELF AS A BENEFICIAL HOLDER AND PROVIDE ITS LEGAL NAME, PHONE NUMBER AND ADDRESS IN ITS WRITTEN DEMAND IN ORDER TO VALIDLY REDEEM SUCH SHARES.
IF THE BUSINESS COMBINATION IS NOT COMPLETED, THEN THESE SHARES SHALL BE RETURNED TO YOU OR YOUR ACCOUNT. IF YOU HOLD YOUR ARTISAN PUBLIC SHARES IN “STREET NAME”, YOU NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BROKER, BANK OR OTHER NOMINEE TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. SEE “EXTRAORDINARY GENERAL MEETING OF ARTISAN SHAREHOLDERS — REDEMPTION RIGHTS” FOR MORE SPECIFIC INSTRUCTIONS.
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| ANNEXES | | | |||||
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Annex A:
Business Combination Agreement (filed as Exhibit 2.1 to this proxy statement/prospectus)
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Annex B:
Amended and Restated Memorandum and Articles of Association of PubCo (filed as Exhibit 3.1 to this proxy statement/prospectus)
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ii
ADDITIONAL INFORMATION
You may request copies of this proxy statement/prospectus and any other publicly available information concerning Artisan, without charge, by written request to Morrow Sodali LLC, our proxy solicitor, by calling (800) 662-5200, or banks and brokers can call collect at (203) 658-9400, or by emailing ARTA.info@investor.morrowsodali.com, or from the SEC through the SEC website at http://www.sec.gov.
In order for Artisan shareholders to receive timely delivery of the documents in advance of the Extraordinary General Meeting of Artisan to be held on , 2022 you must request the information no later than five business days prior to the date of the Extraordinary General Meeting, by , 2022.
1
ABOUT THIS PROXY STATEMENT/PROSPECTUS
This document, which forms part of a registration statement on Form F-4 filed with the U.S. Securities and Exchange Commission, or the “SEC,” by PubCo, constitutes a prospectus of PubCo under Section 5 of the U.S. Securities Act of 1933, as amended, or the “Securities Act,” with respect to the PubCo Class A Ordinary Shares to be issued to Artisan shareholders, the PubCo Class A Ordinary Shares to be issued to certain Prenetics shareholders, the PubCo Warrants to be issued to Artisan warrant holders and the PubCo Class A Ordinary Shares underlying such warrants, if the Business Combination described herein is consummated. This document also constitutes a notice of meeting and a proxy statement under Section 14(a) of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), with respect to the Extraordinary General Meeting of Artisan shareholders at which Artisan shareholders shall be asked to consider and vote upon proposals to approve the Business Combination Proposal and the Initial Merger Proposal (as defined herein) and to adjourn the meeting, if necessary, to permit further solicitation of proxies because there are not sufficient votes to adopt the Business Combination Proposal or the Initial Merger Proposal.
References to “U.S. Dollars”, “USD”, “US$” and “$” in this proxy statement/prospectus are to United States dollars, the legal currency of the United States. Discrepancies in any table between totals and sums of the amounts listed are due to rounding. Certain amounts and percentages have been rounded; consequently, certain figures may add up to be more or less than the total amount and certain percentages may add up to be more or less than 100% due to rounding. In particular and without limitation, amounts expressed in millions contained in this proxy statement/prospectus have been rounded to a single decimal place for the convenience of readers.
2
INDUSTRY AND MARKET DATA
The industry and market position information that appears in this proxy statement/prospectus is from independent market research carried out by Frost & Sullivan, which was commissioned by Prenetics. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to these estimates.
Such information is supplemented where necessary with Prenetics’ own internal estimates and information obtained from discussions with its customers, taking into account publicly available information about other industry participants and Prenetics’ management’s judgment where information is not publicly available. This information appears in “Summary of the Proxy Statement/Prospectus,” “Prenetics Group’s Market Opportunities,” “Prenetics Group’s Business” and “Prenetics Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other sections of this proxy statement/prospectus.
Industry reports, publications, research, studies and forecasts generally state that the information they contain has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. In some cases, we do not expressly refer to the sources from which this data is derived. While we have compiled, extracted, and reproduced industry data from these sources, we have not independently verified the data. We are responsible for the industry and market data contained in this proxy statement/prospectus. Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and uncertainties as the other forward-looking statements in this proxy statement/prospectus. These forecasts and forward-looking information are subject to uncertainty and risk due to a variety of factors, including those described under “Risk Factors.” These and other factors could cause results to differ materially from those expressed in any forecasts or estimates.
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FINANCIAL STATEMENT PRESENTATION
Artisan
The historical financial statements of Artisan were prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and are denominated in U.S. Dollars.
Prenetics
The audited consolidated statements of financial position of Prenetics and its subsidiaries as of December 31, 2021 and 2020, and the related consolidated statements of profit or loss and other comprehensive income, changes in equity and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes, included in this proxy statement/prospectus have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and are presented in U.S. Dollars. Prenetics Group underwent certain corporate restructuring through which Prenetics HK became a wholly owned subsidiary of Prenetics upon the completion of the restructuring in June 2021. As Prenetics had no operations or material assets prior to the restructuring, the restructuring only involves the insertion of Prenetics as a new shell holding company and the financial statements of Prenetics for the periods prior to the corporate restructuring will be substantially identical to the financial statements of Prenetics HK. Accordingly, the references to the historical consolidated financial statements of Prenetics in this proxy statement/prospectus have been prepared on a basis as if the corporate restructuring had happened on January 1, 2019, and the consolidated statements of financial position as of December 31, 2021 and 2020, and the related consolidated statements of profit or loss and other comprehensive income, changes in equity and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes represent the continuation of the consolidated financial statements of Prenetics HK.
PubCo
PubCo was incorporated on July 21, 2021, for the sole purpose of effectuating the transactions described herein. PubCo has no material assets and does not operate any businesses. Accordingly, no financial statements of PubCo have been included in this proxy statement/prospectus.
The Business Combination is made up of the series of transactions provided for in the Business Combination Agreement as described elsewhere in this proxy statement/prospectus. Notwithstanding the legal form, for accounting purposes the Business Combination will be an equity-settled share-based payment transaction where Prenetics as the accounting acquirer issues consideration in exchange of the net assets and listing status of Artisan as the accounting acquiree. The net assets of Prenetics will be stated at their pre-combinaton carrying amounts and any excess of the fair value of the consideration transferred over the fair value of Artisan’s identifiable net assets acquired represents an expense for the listing status.
Immediately following the Business Combination, PubCo will qualify as a foreign private issuer and will prepare its consolidated financial statements in accordance with IFRS.
Accordingly, the unaudited pro forma condensed combined financial information and the comparative per share information that will be presented in this proxy statement/prospectus is prepared and presented to reflect the accounting for the Business Combination under IFRS.
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FREQUENTLY USED TERMS
Unless otherwise stated or unless the context otherwise requires in this document:
“Acquisition Merger” means the merger between Prenetics Merger Sub and Prenetics, with Prenetics being the surviving entity and becoming a wholly-owned subsidiary of PubCo;
“Amended Forward Purchase Agreements” means (i) the Forward Purchase Agreement entered into as of March 1, 2021 with Aspex Master Fund; and (ii) the Forward Purchase Agreement entered into as of March 1, 2021 with Pacific Alliance Asia Opportunity Fund L.P., as amended by the Deeds of Novation and Amendment;
“Artisan” means Artisan Acquisition Corp., an exempted company limited by shares incorporated under the laws of the Cayman Islands;
“Artisan Articles” means Artisan’s amended and restated memorandum and articles of association adopted by special resolution dated 13 May 2021;
“Artisan Board” means the board of directors of Artisan;
“Artisan Merger Sub” means AAC Merger Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a direct wholly-owned subsidiary of PubCo;
“Artisan Public Share” means a Class A ordinary share, par value $0.0001 per share, of Artisan;
“Artisan Public Shareholder” means a holder of Artisan Public Shares issued as part of the Units issued in the IPO;
“Artisan Private Warrants” means the warrants sold to the Sponsor in the private placement consummated concurrently with the IPO, each entitling its holder to purchase one Artisan Public Share at an exercise price of $11.50 per share, subject to adjustment;
“Artisan Public Warrants” means the redeemable warrants issued in the IPO, each entitling its holder to purchase one Artisan Public Share at an exercise price of $11.50 per share, subject to adjustment;
“Artisan Shares” means the Artisan Public Shares and Founder Shares;
“Artisan Warrants” means the Artisan Public Warrants and the Artisan Private Warrants;
“Business Combination” means the Initial Merger, the Acquisition Merger and the other transactions contemplated by the Business Combination Agreement;
“Business Combination Agreement” means the business combination agreement, dated September 15, 2021 (as may be amended, supplemented, or otherwise modified from time to time), by and among PubCo, Artisan, Artisan Merger Sub, Prenetics Merger Sub and Prenetics;
“Business Combination Transactions” means, collectively, the Initial Merger, the Acquisition Merger and each of the other transactions contemplated by the Business Combination Agreement, the PIPE Subscription Agreements, the Amendments to PIPE Subscription Agreements, the Sponsor Support Agreement, the Sponsor Support Agreement Amendment Deed, the Sponsor Agreement, the Shareholder Support Agreements, the Management Shareholder Support Agreement Amendment Deed, the Registration Rights Agreement, the Assignment, Assumption and Amendment Agreement, the Plan of Initial Merger and such other documents as may be required in accordance with applicable law to make the Initial Merger effective, the Plan of Acquisition Merger and such other documents as may be required in accordance with applicable law to make the Acquisition Merger effective, and any other agreements, documents or certificates entered into or delivered pursuant thereto;
“Cayman Islands Companies Act” means the Companies Act (As Revised) of the Cayman Islands;
“Class A Exchange Ratio” means the lower of: (A) 1.29; and (B) (1) (x) the Post-Redemption SPAC Share Number, plus, (y) 3,000,000 divided by (2) the Post-Redemption SPAC Share Number;
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“Class B Recapitalization” means, (i) the conversion of 9,133,558 Founder Shares held by Sponsor into such number of Artisan Public Shares equal to (A) 6,933,558 divided by (B) the Class A Exchange Ratio, (ii) the conversion of an aggregate of 100,000 Founder Shares held by the Artisan independent directors into such number of Artisan Public Shares equal to (1) 100,000 divided by (2) the Class A Exchange Ratio, and (iii) the surrender and forfeiture by Sponsor of such number of Private Placement Warrants equal to (x) 5,857,898 minus (y) the quotient obtained by dividing 5,857,898 by the Class A Exchange Ratio, in each case of (i), (ii) and (iii) pursuant to and subject to the terms and conditions of the Sponsor Agreement immediately prior to the Initial Merger, and (iv) the conversion of all the Founder Shares held by the Forward Purchase Investors on a one-for-one basis pursuant to and subject to the terms and conditions of the Deeds of Amendment to the Deeds of Novation and Amendment immediately prior to the Initial Closing;
“Closing” means the closing of the Acquisition Merger;
“China,” “mainland China” or “PRC”, in each case, means the People’s Republic of China, excluding Hong Kong, Macau and Taiwan. The term “Chinese” has a correlative meaning for the purpose of this proxy statement/prospectus;
“Closing Date” means the date of the Closing;
“Continental” means Continental Stock Transfer & Trust Company;
“Deeds of Novation and Amendment” means (i) the Deed of Novation and Amendment entered into by Artisan, Sponsor, PubCo and Aspex Master Fund, dated as of September 15, 2021 (pursuant to such amendment, Aspex Master Fund committed to subscribe for and purchase 3,000,000 PubCo Class A Ordinary Shares and 750,000 PubCo Warrants for an aggregate purchase price equal to $30 million); and (ii) the Deed of Novation and Amendment entered into by Artisan, Sponsor, PubCo and Pacific Alliance Asia Opportunity Fund L.P., dated as of September 15, 2021 (pursuant to such amendment, Pacific Alliance Asia Opportunity Fund L.P. committed to subscribe for and purchase 3,000,000 PubCo Class A Ordinary Shares and 750,000 PubCo Warrants for an aggregate purchase price equal to $30 million);
“Dissent Rights” means the right of each holder of record of Artisan Shares to dissent in respect of the Initial Merger pursuant to Section 238 of the Cayman Islands Companies Act;
“Dissenting Artisan Shareholders” means holders of Dissenting Artisan Shares;
“Dissenting Artisan Shares” means Artisan Shares that are (i) issued and outstanding immediately prior to the Initial Merger Effective Time and (ii) held by Artisan shareholders who have validly exercised their Dissent Rights (and not waived, withdrawn, lost or failed to perfect such rights);
“ESOP” means the 2021 Share Incentive Plan of Prenetics adopted on June 16, 2021, as may be amended from time to time;
“Exchange Ratio” means the quotient obtained by dividing the Price per Share by $10.00;
“Existing Warrant Agreement” means the warrant agreement, dated May 13, 2021, by and between Artisan and Continental;
“Extraordinary General Meeting” means an extraordinary general meeting of shareholders of Artisan to be held at AM time, on , 2022 at and virtually over the Internet via live audio webcast at https://www.cstproxy.com/artisanacquisition/2022;
“Forward Purchase Investors” means Aspex Master Fund and Pacific Alliance Asia Opportunity Fund L.P.;
“Founder Share” means a Class B ordinary share, par value $0.0001 per share, of Artisan;
“Fully-Diluted Company Shares” means, without duplication, (a) the aggregate number of Prenetics Ordinary Shares (i) that are issued and outstanding immediately prior to the Acquisition Effective Time and (ii) that are issuable upon the exercise of all Prenetics RSUs, options, warrants, convertible notes and other equity securities of Prenetics that are issued and outstanding immediately prior to the Acquisition
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Effective Time, including an aggregate of 776,432 shares to be issued by Prenetics as deferred consideration of Prenetics Limited’s acquisition of Oxsed Limited, minus (b) Prenetics’ treasury shares;
“Initial Closing” means the closing of the Initial Merger;
“Initial Merger” means the merger between Artisan and Artisan Merger Sub, with Artisan Merger Sub being the surviving entity and remaining as a wholly-owned subsidiary of PubCo;
“Initial Shareholders” means Artisan LLC, William Keller, Mitch Garber, Fan Yu, Sean O’Neill and the Forward Purchase Investors;
“IPO” means Artisan’s initial public offering, which was consummated on May 18, 2021;
“Management Shareholder Support Agreement Amendment Deed” means that certain Deed of Amendment entered into on March 30, 2022 by and among Prenetics, Artisan, PubCo, Danny Yeung and Dr. Lawrence Tzang which amends the Prenetics Shareholder Support Agreement dated as of September 15, 2021 by and among Prenetics, Artisan, PubCo, Danny Yeung and Dr. Lawrence Tzang;
“NASDAQ” means the Nasdaq Stock Market;
“Plan of Acquisition Merger” means the plan of merger for the Acquisition Merger by and among Prenetics, Prenetics Merger Sub and PubCo;
“Plan of Initial Merger” means the plan of merger for the Initial Merger by and among Artisan, Artisan Merger Sub and PubCo;
“Post-Redemption SPAC Share Number” means (a) the aggregate number of Artisan Public Shares issued and outstanding as of immediately prior to the Class B Recapitalization, minus (b) the treasury shares held by Artisan that are issued and outstanding immediately prior to the Class B Recapitalization, minus (c) the Artisan Public Shares subject to the redemptions issued and outstanding immediately prior to the Class B Recapitalization, minus (d) the Dissenting Artisan Shares issued and outstanding immediately prior to the Class B Recapitalization;
“Prenetics” means Prenetics Group Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands;
“Prenetics Group” means Prenetics Group Limited, together as a group with its subsidiaries, including its operating subsidiaries, and, prior to the termination of the VIE agreements on November 26, 2021, Shenzhen Discover Health Technology Co., Ltd., or the “VIE Entity”;
“Prenetics HK” means Prenetics Limited, a limited liability company incorporated in Hong Kong;
“Prenetics Merger Sub” means PGL Merger Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a direct wholly-owned subsidiary of PubCo;
“Prenetics Operating Subsidiaries” means, collectively, the operating subsidiaries of Prenetics Group Limited, which include Prenetics Limited, Prenetics EMEA Limited, Oxsed Limited, Prenetics Innovation Labs Private Limited and Prenetics Africa (Pty) Limited.
“Price per Share” means an amount equal to (a) (x) $1,150,000,000 minus (y) $20,520,000, divided by (b) the Fully-Diluted Company Shares;
“PubCo” means Prenetics Global Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands, or as the context requires, PubCo and its subsidiaries and consolidated affiliated entities;
“PubCo Class A Ordinary Share” means a Class A ordinary share, par value $0.0001 per share, of PubCo;
“PubCo Class B Ordinary Share” means a convertible Class B ordinary share, par value $0.0001 per share, of PubCo;
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“SEC” means the U.S. Securities and Exchange Commission;
“Sponsor” means Artisan LLC, a limited liability company registered under the laws of the Cayman Islands;
“Sponsor Agreement” means that certain Sponsor Forfeiture and Conversion Agreement entered into on March 30, 2022 by and among Prenetics, Artisan, PubCo, Sponsor and the independent directors of Artisan;
“Sponsor Support Agreement Amendment Deed” means that certain Deed of Amendment entered into on March 30, 2022 by and among Prenetics, Artisan, PubCo, Sponsor and the directors of Artisan which amends the Sponsor Support Agreement;
“Units” means the units issued in the IPO, each consisting of one Artisan Public Share and one-third of one Artisan Public Warrant;
“U.S. Dollars” and “$” means United States dollars, the legal currency of the United States.
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QUESTIONS AND ANSWERS ABOUT THE PROPOSALS
The questions and answers below highlight only selected information from this document and only briefly address some commonly asked questions about the proposals to be presented at the Extraordinary General Meeting, including with respect to the proposed Business Combination. The following questions and answers do not include all the information that is important to Artisan shareholders. Artisan shareholders should read this proxy statement/prospectus, including the Annexes and the other documents referred to herein, carefully and in their entirety to fully understand the proposed Business Combination and the voting procedures for the Extraordinary General Meeting, which will be held at AM time, on , 2022 at and virtually over the Internet via live audio webcast at https://www.cstproxy.com/artisanacquisition/2022.
Q:
Why am I receiving this proxy statement/ prospectus?
A:
Artisan shareholders are being asked to consider and vote upon a proposal to approve and adopt the Business Combination and certain related proposals.
Artisan, Prenetics, PubCo and other parties have agreed to the Business Combination under the terms of the Business Combination Agreement that is described in this proxy statement/prospectus. The Business Combination Agreement provides for, among other things, (a) the merger of Artisan with and into Artisan Merger Sub, with Artisan Merger Sub being the surviving entity and remaining a wholly-owned subsidiary of PubCo, and each of the current security holders of Artisan receiving securities of PubCo, and (b) the merger of Prenetics Merger Sub with and into Prenetics, with Prenetics as the surviving entity and becoming a wholly-owned subsidiary of PubCo, and each of the current security holders of Prenetics receiving securities of PubCo. This proxy statement/prospectus and its Annexes contain important information about the proposed Business Combination and the other matters to be acted upon at the Extraordinary General Meeting. You should read this proxy statement/prospectus and its Annexes carefully and in their entirety.
Q:
What proposals are shareholders of Artisan being asked to vote upon?
A:
At the Extraordinary General Meeting, Artisan is asking holders of its ordinary shares to consider and vote upon the following proposals:
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Business Combination Proposal — To adopt the Business Combination Agreement and approve the Business Combination and the other transactions contemplated thereby. See “The Business Combination Proposal.”
•
Initial Merger Proposal — To authorize the Initial Merger and the Plan of Initial Merger. See “The Initial Merger Proposal.”
•
Adjournment Proposal — To adjourn the Extraordinary General Meeting to a later date or dates to permit further solicitation and voting of proxies if, based upon the tabulated vote at the time of the Extraordinary General Meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote or if holders of Artisan Public Shares, have elected to redeem an amount of Artisan Public Shares such that the minimum available cash condition contained in the Business Combination Agreement would not be satisfied. See “The Adjournment Proposal.”
•
Artisan shall hold the Extraordinary General Meeting of its shareholders to consider and vote upon these proposals. This proxy statement/prospectus contains important information about the proposed Business Combination and the other matters to be acted upon at the Extraordinary General Meeting. Shareholders should read it carefully.
The vote of Artisan shareholders is important. Artisan shareholders are encouraged to submit their completed proxy card as soon as possible after carefully reviewing this proxy statement/prospectus.
Q:
Why is Artisan providing shareholders with the opportunity to vote on the Business Combination?
A:
Pursuant to the Artisan Articles, Artisan is required to provide Artisan Public Shareholders with an opportunity to have their Artisan Public Shares redeemed for cash upon the consummation of its initial
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business combination, either in conjunction with a shareholder vote or tender offer. Due to the structure of the Business Combination, Artisan is providing this opportunity in conjunction with a shareholder vote.
Q:
Why is Artisan proposing the Business Combination?
A:
Artisan was incorporated to effect a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities.
Based on its due diligence investigations of Prenetics and the industries in which it operates, including the financial and other information provided by Prenetics in the course of Artisan’s due diligence investigations, the Artisan Board believes that the Business Combination with Prenetics is in the best interests of Artisan and presents an opportunity to increase shareholder value. However, there can be no assurances of this. Although the Artisan Board believes that the Business Combination with Prenetics presents a unique business combination opportunity and is in the best interests of Artisan, the Artisan Board did consider certain potentially material negative factors in arriving at that conclusion. See “The Business Combination Proposal — The Artisan Board’s Reasons for the Approval of the Business Combination” for a discussion of the factors considered by the Artisan Board in making its decision.
Q:
Did the Artisan Board obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Business Combination?
A:
No. The Artisan Board did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the Business Combination. However, Artisan’s management, the members of the Artisan Board and the other representatives of Artisan have substantial experience in evaluating the operating and financial merits of companies similar to Prenetics and reviewed certain financial information of Prenetics and other relevant financial information selected based on the experience and the professional judgment of Artisan’s management team, which enabled them to make the necessary analyses and determinations regarding the Business Combination. Accordingly, investors will be relying solely on the judgment of the Artisan Board in valuing Prenetics’ business and assume the risk that the Artisan Board may not have properly valued such business.
Q:
What is expected to happen in the Business Combination?
A:
In accordance with the terms and subject to the conditions of the Business Combination Agreement, (i) Artisan shall merge with and into Artisan Merger Sub, with Artisan Merger Sub being the surviving entity and remaining as a wholly-owned subsidiary of PubCo, and (ii) following the Initial Merger, Prenetics Merger Sub shall merge with and into Prenetics, with Prenetics being the surviving entity and becoming a wholly-owned subsidiary of PubCo.
Pursuant to the Business Combination Agreement, upon the consummation of the Initial Merger: (i) each Unit (each consisting of one Artisan Public Share and one-third of one Artisan Public Warrant included as part of such unit) issued and outstanding immediately prior to the Initial Merger Effective Time shall be automatically separated and the holder thereof shall be deemed to hold one Artisan Public Share and one-third of one Artisan Public Warrant; provided, that, no fractional Artisan Public Warrants shall be issued in connection with such separation such that if a holder of such Units would be entitled to receive a fractional Artisan Public Warrant upon such separation, the number of Artisan Public Warrants to be issued to such holder upon such separation will be rounded down to the nearest whole number of Artisan Public Warrants and no cash will be paid in lieu of such fractional Artisan Public Warrants; (ii) immediately following the separation of each Unit, each Artisan Share (excluding Artisan Public Shares that are held by Artisan shareholders that validly exercise their redemption rights, Artisan Shares that are held by Artisan shareholders that exercise and perfect their relevant dissenters’ rights and Artisan treasury shares) issued and outstanding immediately prior to the effective time of the Initial Merger shall be cancelled in exchange for the right to receive the number of newly issued PubCo Class A Ordinary Shares equal to the Class A Exchange Ratio; and (iii) each whole Artisan Warrant outstanding immediately prior to the Initial Merger Effective Time shall cease to be a warrant with respect to Artisan Public Shares and be assumed by PubCo and converted into a
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warrant to purchase such number of PubCo Class A Ordinary Share equal to the Class A Exchange Ratio, subject to substantially the same terms and conditions prior to the effective time of the Initial Merger.
Aspex Master Fund, an exempted company incorporated under the laws of the Cayman Islands, has agreed to purchase 3,000,000 PubCo Class A Ordinary Shares and 750,000 PubCo Warrants for an aggregate price equal to $30,000,000 immediately prior to the Acquisition Effective Time and Pacific Alliance Asia Opportunity Fund L.P., an exempted limited partnership formed under the laws of the Cayman Islands (together with Aspex Master Fund, the “Forward Purchase Investors”), has agreed to purchase 3,000,000 PubCo Class A Ordinary Shares and 750,000 PubCo Warrants for an aggregate price equal to $30,000,000 immediately prior to the Acquisition Effective Time. In connection with and concurrently with the execution of the BCA Amendment, Artisan, PubCo and Sponsor entered into a Deed of Amendment to Deed of Novation and Amendment with each of the Forward Purchase Investors, respectively, pursuant to which (i) the number of PubCo Class A Ordinary Shares to be purchased by each Forward Purchase Investor immediately prior to the Acquisition Effective Time is increased by multiplying (a) the number of PubCo Class A Ordinary Shares that such Forward Purchase Investor has agreed to purchase under the relevant Amended Forward Purchase Agreement by (b) the Class A Exchange Ratio, without additional consideration payable by such Forward Purchase Investor; (ii) the lock-up period applicable to such Forward Purchase Investor is to be amended to six months after the consummation of the Business Combination, subject to an earlier release if certain criteria are met; and (iii) such Forward Purchase Investor shall convert all Founder Shares held by it into Artisan Public Shares on a one-for-one basis immediately prior to the Initial Closing.
In addition, pursuant to the Business Combination Agreement, upon the consummation of the Acquisition Merger: (i) each Prenetics Share (excluding shares that are held by Prenetics shareholders that exercise and perfect their relevant dissenters’ rights, the Prenetics Key Executive Shares and Prenetics treasury shares) issued and outstanding immediately prior to the Acquisition Effective Time shall be cancelled in exchange for the right to receive such fraction of a newly issued PubCo Class A Ordinary Share that is equal to the Exchange Ratio, without interest, subject to rounding up to the nearest whole PubCo Class A Ordinary Share with respect to the total number of PubCo Class A Ordinary Shares to be received by each Prenetics shareholder; and (ii) each Prenetics Key Executive Share issued and outstanding immediately prior to the Acquisition Effective Time shall be cancelled in exchange for the right to receive such fraction of a newly issued PubCo Class B Ordinary Share that is equal to the Exchange Ratio, without interest, subject to rounding up to the nearest whole PubCo Class B Ordinary Share with respect to the total number of PubCo Class B Ordinary Shares to be received by Danny Yeung; (iii) each Prenetics RSU outstanding immediately prior to the Acquisition Effective Time, whether vested or unvested, shall be automatically assumed by PubCo and converted into an award of restricted share units representing the right to receive the number of PubCo Class A Ordinary Shares equal to (x) the number of Prenetics Ordinary Shares subject to such Prenetics RSU immediately prior to the Acquisition Effective Time multiplied by (x) the Exchange Ratio (such product rounded down to the nearest whole number), and otherwise, shall be subject to substantially the same terms and conditions as were applicable to such Prenetics RSU immediately prior to the Acquisition Effective Time; and (iv) each Prenetics Key Executive RSU outstanding immediately prior to the Acquisition Effective Time, whether vested or unvested, shall be automatically assumed by PubCo and converted into an award of restricted share units representing the right to receive the number of PubCo Class B Ordinary Shares equal to (A) the number of Prenetics Ordinary Shares subject to such Prenetics Key Executive RSU immediately prior to the Acquisition Effective Time multiplied by (B) the Exchange Ratio (such product rounded down to the nearest whole number), and otherwise, shall be subject to substantially the same terms and conditions as were applicable to such Prenetics Key Executive RSU immediately prior to the Acquisition Effective Time. For more information on the Initial Merger and the Acquisition Merger, see “The Business Combination Proposal” and “The Initial Merger Proposal”. For further information on PubCo’s securities upon consummation of the Business Combination, see “Risk Factors — Risks Relating to PubCo and Ownership of PubCo’s Shares — PubCo’s dual-class voting structure may limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of PubCo Class A Ordinary Shares may view as beneficial,” and “Description of PubCo Securities — Ordinary Shares.”
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In addition, concurrently with the execution of the Business Combination Agreement, certain PIPE Investors entered into share subscription agreements with Artisan and PubCo, pursuant to which they agreed to subscribe for and purchase PubCo Class A Ordinary Shares at $10.00 per share for an aggregate purchase price of $60,000,000. The closing of the PIPE Investment is contingent upon the substantially concurrent consummation of the Mergers. In connection with and concurrently with the execution of the BCA Amendment, Artisan and PubCo entered into an Amendment to PIPE Subscription Agreement with each of the PIPE Investors, respectively, pursuant to which the number of PubCo Class A Ordinary Shares to be purchased by each PIPE Investor immediately prior to the Acquisition Effective Time is increased by multiplying (a) the number of PubCo Class A Ordinary Shares that such PIPE Investor has agreed to purchase under the relevant PIPE Subscription Agreement by (b) the Class A Exchange Ratio, without additional consideration payable by such PIPE Investor.
Q:
What shall be the relative equity stakes of Artisan shareholders, Prenetics shareholders and the PIPE Investors upon completion of the Business Combination?
A:
Upon consummation of the Business Combination, PubCo shall become a new public company and each of Artisan Merger Sub and Prenetics shall be a wholly-owned subsidiary of PubCo. The former security holders of Artisan, including the Forward Purchase Investors, the former security holders of Prenetics and the PIPE Investors shall all become security holders of PubCo.
Pursuant to the Artisan Articles, in connection with the completion of the Business Combination, Artisan Public Shareholders may elect to have their Artisan Public Shares redeemed for cash at the applicable redemption price per share calculated in accordance with the Artisan Articles. Payment for such redemptions shall come from the trust account.
Upon consummation of the Business Combination, assuming that (i) no Artisan shareholder exercises its dissenters’ rights; (ii) no Prenetics shareholder exercises its dissenters’ rights; and (iii) no shares underlying Prenetics’ outstanding restricted share units will be issued upon consummation of the Business Combination, the post-Closing share ownership of PubCo would be as follows under (1) the No Redemption Scenario; and (2) the scenario where 25,931,200 Artisan Public Shares are redeemed for aggregate redemption payments of $259,312,000, assuming a $10.00 per share Redemption Price and based on funds in the Trust Account and working capital available to Artisan as of September 30, 2021, which is based on a condition to the Closing under the Business Combination, at the Closing, the cash proceeds from the trust account established for the purpose of holding the net proceeds of Artisan’s initial public offering, plus cash proceeds from the PIPE Investments, plus cash proceeds under the Forward Purchase Agreements, plus any amount raised pursuant to permitted equity financings prior to closing of the Acquisition Merger in the aggregate equaling no less than $200,000,000 (the “Maximum Redemption Scenario”):
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Share Ownership and Voting Power in PubCo(1)(2)(3)(4)
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Assuming No Redemptions (Shares)
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Assuming Maximum Redemptions (Shares)
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Number of
Class A Ordinary Shares |
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Share
Ownership % |
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Voting
Power % |
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Number of
Class B Ordinary Shares |
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Share
Ownership % |
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Voting
Power % |
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Number of
Class A Ordinary Shares |
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Share
Ownership % |
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Voting
Power % |
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Number of
Class B Ordinary Shares |
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Share
Ownership % |
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Voting
Power % |
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Prenetics Shareholders
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| | | | 71,784,095 | | | | | | 51.51% | | | | | | 22.17% | | | | | | 9,711,166 | | | | | | 6.97% | | | | | | 59.97% | | | | | | 71,784,095 | | | | | | 62.23% | | | | | | 23.94% | | | | | | 9,711,166 | | | | | | 8.42% | | | | | | 64.76% | | |
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Artisan Public Shareholders(6)
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| | | | 36,934,235 | | | | | | 26.51% | | | | | | 11.40% | | | | | | — | | | | | | — | | | | | | — | | | | | | 10,352,497 | | | | | | 8.97% | | | | | | 3.45% | | | | | | — | | | | | | — | | | | | | — | | |
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Sponsor and certain Artisan directors(5)(7)
|
| | | | 7,033,558 | | | | | | 5.05% | | | | | | 2.17% | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,033,558 | | | | | | 6.10% | | | | | | 2.35% | | | | | | — | | | | | | — | | | | | | — | | |
|
PIPE Investors(8)
|
| | | | 6,530,438 | | | | | | 4.69% | | | | | | 2.02% | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,768,126 | | | | | | 6.73% | | | | | | 2.59% | | | | | | — | | | | | | — | | | | | | — | | |
|
Forward Purchase Investors(5)(9)
|
| | | | 7,346,743 | | | | | | 5.27% | | | | | | 2.27% | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,739,142 | | | | | | 7.57% | | | | | | 2.91% | | | | | | — | | | | | | — | | | | | | — | | |
|
Pro forma Combined Company Ordinary Shares
|
| | |
|
129,629,069
|
| | | |
|
93.03%
|
| | | |
|
40.03%
|
| | | |
|
9,711,166
|
| | | |
|
6.97%
|
| | | |
|
59.97%
|
| | | |
|
105,677,418
|
| | | |
|
91.58%
|
| | | |
|
35.24%
|
| | | |
|
9,711,166
|
| | | |
|
8.42%
|
| | | |
|
64.76%
|
| |
12
(1)
The share amounts and ownership and voting power percentages set forth above do not take into account (i) warrants that will remain outstanding immediately following the Business Combination and may be exercised thereafter to acquire PubCo Class A Ordinary Shares and (ii) any outstanding Prenetics RSUs, vested or unvested, that were assumed by PubCo upon the completion of the Business Combination. If the actual facts are different than the assumptions set forth above, the share amounts and percentage ownership numbers set forth above will be different.
(2)
For a more detailed description of share ownership upon consummation of the Business Combination, see “Beneficial Ownership of Securities.”
(3)
In both the No Redemption Scenario and the Maximum Redemption Scenario, the payment of deferred underwriting fees incurred as part of the IPO will be $11,876,982.
(4)
Each PubCo Class A Ordinary Share is entitled to one vote per share. Each PubCo Class B Ordinary Share is entitled to twenty (20) votes per share.
(5)
The share amounts reflect the transfer of 750,000 Founder Shares of Artisan from the Sponsor to the Forward Purchase Investors in connection with the Forward Purchase Agreements.
(6)
Outstanding Artisan Class A ordinary shares held by the Artisan Public Shareholders are converted into the number of PubCo Class A ordinary shares equal to the Class A Exchange Ratio of (i) 1.09 under a No Redemption Scenario or (ii) 1.29 under a Maximum Redemption Scenario. This Class A Exchange Ratio reflects the additional 3.0 million shares issuable on a pro rata basis to the Artisan Public Shareholders who do not redeem their shares.
(7)
Outstanding Artisan Class B ordinary shares held by the Sponsor and certain Artisan directors are exchanged (a) with respect to the 9,133,558 Artisan Class B ordinary shares held by the Sponsor, into the number of Artisan Class A Ordinary Shares equal to (x) 9,133,558 minus 2,200,000, divided by (y) the Class A Exchange Ratio and (b) with respect to the 100,000 Artisan Class B ordinary shares held by certain Artisan directors, into the number of Artisan Class A ordinary shares equal to (x) 100,000 divided by (y) the Class A Exchange Ratio. The Artisan Class A ordinary shares held by the Sponsor and certain Artisan directors are then converted into the number of PubCo Class A ordinary shares equal to the Class A Exchange Ratio.
(8)
Pursuant to the amended PIPE subscription agreements, PubCo will issue to the PIPE investors the number of PubCo Class A ordinary shares equal to (x) 6,000,000 multiplied by the Class A Exchange Ratio of (i) 1.09 under a No Redemption Scenario or (ii) 1.29 under a Maximum Redemption Scenario.
(9)
Pursuant to the amended Forward Purchase subscription agreements, PubCo will issue to the Forward Purchase investors the number of PubCo Class A ordinary shares equal to (x) 6,000,000 multiplied by the Class A Exchange Ratio of (i) 1.09 under a No Redemption Scenario or (ii) 1.29 under a Maximum Redemption Scenario.
Artisan Public Shareholders who do not elect to redeem their Artisan Public Shares (“Non-redeeming Artisan Public Shareholders”) in connection with the Business Combination may experience dilution of their equity position by (1) issuance of additional PubCo Class A Ordinary Shares upon the exercise of (i) up to 5,857,898 Artisan Private Warrants issued to the Sponsor in the IPO and the over-allotment option exercise (which will be converted into up to 5,382,119 PubCo warrants upon the Initial Closing), which could dilute the equity interest of Non-redeeming Artisan Public Shareholders in PubCo by 1.07% to 25.44% assuming no redemptions by Artisan Public Shareholders and there are no Dissenting Artisan Shareholders (or by 0.43% to 8.54% assuming maximum redemptions by Artisan Public Shareholders), (ii) up to 200,000 Artisan Private Warrants issuable to the Sponsor pursuant to the Second Promissory Note (as defined below) dated August 16, 2021 (which will be converted into up to 183,756 PubCo warrants upon the Initial Closing), which could dilute the equity interest of Non-redeeming Artisan Public Shareholders in PubCo by 0.04% to 26.47% assuming no redemptions by Artisan Public Shareholders and there are no Dissenting Artisan Shareholders (or by 0.02% to 8.96% assuming maximum redemptions by Artisan Public Shareholders), (iii) up to 11,311,386 Artisan Public Warrants held by Artisan Public Shareholders, whether or not they elect to redeem their Artisan Public Shares, or by other holders of Artisan Public Warrants, which could dilute the equity interest of Non-redeeming Artisan Public Shareholders in PubCo by 2.15% to 24.35% assuming no redemptions by Artisan Public Shareholders and there are no Dissenting Artisan Shareholders (or by 1.01% to 7.96% assuming maximum redemptions by Artisan Public Shareholders), and (iv) up to 1,500,000 PubCo Warrants held by the Forward Purchase Investors, which could dilute the equity interest of Non-redeeming Artisan Public Shareholders in PubCo by 0.31% to 26.20% assuming no redemptions by Artisan Public Shareholders and there are no Dissenting Artisan Shareholders (or by 0.15% to 8.82% assuming maximum redemptions by Artisan Public Shareholders); and (2) issuance of additional PubCo securities that are issuable upon the exercise of all Prenetics RSUs, options, warrants, convertible notes and other equity securities of Prenetics that are outstanding or may be issued in the future in connection with the Prenetics 2021 Plan, the PubCo 2022 Plan and potential fund raising, acquisitions or strategic alliances by Prenetics, including an aggregate of 776,432 shares to be issued by Prenetics
13
as deferred consideration for Prenetics HK’s acquisition of Oxsed Limited. For a more detailed description of share ownership upon consummation of the Business Combination, see “Beneficial Ownership of Securities.”
Q:
What are the U.S. Federal income tax consequences of the Business Combination to U.S. holders of Artisan Share and/or Artisan Public Warrants?
A:
Certain material U.S. federal income tax considerations that may be relevant to you in respect of the Business Combination are discussed in more detail in the section titled “Material Tax Considerations.” The discussion of the U.S. federal income tax consequences contained in this proxy statement/prospectus is intended to provide only a general discussion and is not a complete analysis or description of all of the U.S. federal income tax considerations that are applicable to you in respect of the Business Combination, nor does it address any tax considerations arising under U.S. state or local or non-U.S. tax laws. You are urged to consult your tax advisors regarding the tax consequences of the Business Combination.
Q:
What are the U.S. federal income tax consequences of exercising my redemption rights?
A:
The receipt of cash by a U.S. holder of Artisan Shares on redemption of such shares will be a taxable transaction for U.S. federal income tax purposes. Please see “Material Tax Considerations — U.S. Federal Income Tax Considerations — U.S. Federal Income Tax Considerations to U.S. Holders — Redemption of Artisan Public Shares” for additional information. You are urged to consult your tax advisors regarding the tax consequences of exercising your redemption rights.
Q:
What conditions must be satisfied to complete the Business Combination?
A:
There are a number of closing conditions to the Business Combination, including, but not limited to, the following:
•
the effectiveness of this Form F-4 and the absence of any issued or pending stop order by the SEC;
•
approval of the Business Combination Proposal by way of ordinary resolution and the Initial Merger Proposal by way of special resolution by the Artisan shareholders, and the approval and consent of the Business Combination and the transactions contemplated by the Business Combination Agreement by the Prenetics shareholders;
•
receipt of approval for PubCo Class A Ordinary Shares and PubCo Warrants to be listed on NASDAQ, subject only to official notice of issuance;
•
the Available Closing Cash Amount (as defined below) being not less than US$200 million;
•
the absence of any Prenetics Material Adverse Effect (as defined below);
•
the absence of any Artisan Material Adverse Effect (as defined below); and
•
the absence of any law (whether temporary, preliminary or permanent) or governmental order then in effect and which has the effect of making the Initial Closing or the Closing illegal or which otherwise prevents or prohibits the consummation of the Initial Closing or the Closing (any of the foregoing, a “restraint”), other than any such restraint that is immaterial.
For a summary of all of the conditions that must be satisfied or waived prior to completion of the Business Combination, see “The Business Combination Agreement.”
Q:
How many votes do I have at the Extraordinary General Meeting?
A:
Artisan shareholders are entitled to one vote at the Extraordinary General Meeting for each Artisan Share held of record as of close of business on , 2022, the record date for the Extraordinary General Meeting (the “record date”). As of the close of business on the record date, there were Artisan Public Shares and Founder Shares outstanding and entitled to vote.
14
Q:
What vote is required to approve the proposals presented at the Extraordinary General Meeting?
The following votes are required for each proposal at the Extraordinary General Meeting:
•
Business Combination Proposal — The approval of the Business Combination Proposal will require an ordinary resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of a majority of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.
•
Initial Merger Proposal — The approval of the Initial Merger Proposal will require a special resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of at least two-thirds of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.
•
Adjournment Proposal — The approval of the Adjournment Proposal, if presented, will require an ordinary resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of a majority of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.
If you are an Artisan shareholder that attends the Extraordinary General Meeting and fails to vote on the Business Combination Proposal, Initial Merger Proposal or Adjournment Proposal, or if you respond to such proposals with an “abstain” vote, your failure to vote or “abstain” vote in each case will have no effect on the vote count for such proposals. Brokers are not entitled to vote on the Business Combination Proposal, the Initial Merger Proposal or the Adjournment Proposal absent voting instructions from the beneficial holder. An abstention or broker non-vote will be counted towards the quorum requirement but will not count as a vote cast at the Extraordinary General Meeting.
Q:
What constitutes a quorum at the Extraordinary General Meeting?
A:
A quorum shall be present at the Extraordinary General Meeting if one or more shareholders holding not less than one-third of the issued and outstanding Artisan Shares entitled to vote at the Extraordinary General Meeting are present in person or by proxy. If a quorum is not present within half an hour from the time appointed for the Extraordinary General Meeting to commence or if during the meeting a quorum ceases to be present, the meeting shall stand adjourned to the same day in the next week at the same time and place or to such other day, time and/or place as the directors of Artisan may determine, and if at the adjourned meeting a quorum is not present within half an hour from the time appointed for the meeting to commence, the Artisan shareholders present shall be a quorum.
As of the record date, 14,639,265 Artisan Shares would be required to achieve a quorum.
Q:
How do holders of Artisan’s Founder Shares intend to vote on the proposals?
A:
Holders of the Founder Shares beneficially own and are entitled to vote an aggregate of approximately 22.73% of the outstanding Artisan Shares. These holders are required by certain agreements to vote their shares in favor of the Business Combination Proposal, the Initial Merger Proposal and the Adjournment Proposal, if presented at the Extraordinary General Meeting.
Q:
What interests do Artisan’s Directors and Officer have in the Business Combination?
A:
When considering the Artisan Board’s recommendation to vote in favor of approving the Business Combination Proposal and the Initial Merger Proposal, Artisan shareholders should keep in mind that Sponsor and Artisan’s directors and officer have interests in such proposals that are different from, or in addition to (and which may conflict with), those of Artisan shareholders and warrantholders generally. These interests include, among other things, the interests listed below:
•
the fact that the Sponsor and Artisan’s directors and officer have agreed not to redeem any Artisan Shares held by them in connection with a shareholder vote to approve the proposed Business Combination;
•
the fact that the Sponsor and certain of Artisan’s directors are anticipated to hold 5.1% of the equity interest and 2.2% of the voting power in PubCo immediately after the Business Combination,
15
assuming no redemptions by Artisan Public Shareholders and there are no Dissenting Artisan Shareholders (or 6.1% of the equity interest and 2.4% of the voting power in PubCo immediately after the Business Combination, assuming maximum redemptions by Artisan Public Shareholders);
•
the fact that the Sponsor and Artisan’s directors paid an aggregate of $25,000 for the 9,233,558 Founder Shares currently owned by the Sponsor and Artisan’s directors and such securities will have a significantly higher value after the Business Combination. As of , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus, the aggregate market value of these shares, if unrestricted and freely tradable, would be $ , based upon a closing price of $ per Artisan Public Share on NASDAQ. The Founder Shares are expected to be worthless if the Business Combination or another business combination is not completed by May 18, 2023 or such later date as may be approved by Artisan’s shareholders in an amendment to the Artisan Articles (such date the “Final Redemption Date”) because the holders are not entitled to participate in any redemption or distribution of proceeds in the trust account with respect to such shares;
•
the fact that Sponsor paid $8,786,847 to purchase an aggregate of 5,857,898 Artisan Private Warrants, each exercisable to purchase one Artisan Public Share at $11.50, subject to adjustment, at a price of $1.50 per warrant, and those warrants would be worthless — and the entire $8,786,847 warrant investment would be lost — if the Business Combination or another business combination is not consummated by the Final Redemption Date. As of , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus, the aggregate market value of these Artisan Private Warrants, if unrestricted and freely tradable, would be $ , based upon a closing price of $ per Artisan Public Warrant on NASDAQ;
•
the fact that, given the differential in the purchase price that the Sponsor and certain of Artisan’s directors paid for the Founder Shares and the purchase price that the Sponsor paid for the Artisan Private Warrants as compared to the price of the Artisan Public Shares and Artisan Public Warrants and the substantial number of PubCo Class A Ordinary Shares that the Sponsor and these directors will receive upon conversion of the Founder Shares and Artisan Private Warrants, the Sponsor and these directors can earn a positive return on their investment, even if other Artisan shareholders have a negative return on their investment in PubCo;
•
the fact that Sponsor and Artisan’s directors and officer have agreed to waive their rights to liquidating distributions from the trust account with respect to any Founder Shares held by them if Artisan fails to complete a business combination by the Final Redemption Date;
•
the fact that pursuant to a registration rights agreement dated May 13, 2021, the Sponsor and Artisan’s directors can demand that PubCo register its registrable securities under certain circumstances and assist in underwritten takedowns of such securities and will also have piggyback registration rights for these securities in connection with certain registrations of securities that PubCo undertakes;
•
the fact that the Business Combination Agreement provides for the continued indemnification of Artisan’s directors and officer and the continuation of Artisan’s directors’ and officer’s liability insurance after the Business Combination (i.e., a “tail policy”);
•
the fact that Sponsor and Artisan’s directors and officer and their affiliates are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on Artisan’s behalf, such as identifying and investigating possible business targets and business combinations. However, if Artisan fails to consummate a business combination within the required period, they will not have any claim against the trust account for reimbursement. Accordingly, Artisan may not be able to reimburse these expenses if the Business Combination or another business combination is not completed by the Final Redemption Date. As of the record date, the Sponsor and Artisan’s directors and officer and their affiliates had incurred approximately $ of unpaid reimbursable expenses;
•
the fact that if the trust account is liquidated, including in the event Artisan is unable to complete a business combination by the Final Redemption Date, the Sponsor has agreed to indemnify Artisan to ensure that the proceeds in the trust account are not reduced below $10.00 per Artisan Public Share, or such lesser per Artisan Public Share amount as is in the trust account on the liquidation date, by the claims of prospective target businesses with which Artisan has discussed entering into a
16
transaction agreement or claims of any third party for services rendered or products sold to Artisan, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the trust account;
•
the fact that an affiliate of the Sponsor entered into a convertible note subscription agreement with Prenetics HK in February 2021, pursuant to which it acquired 454,387 series D preferred shares of Prenetics HK for a consideration of $3,000,000, representing 0.82% of the equity interests in Prenetics on a fully diluted basis as of the date of this proxy statement/prospectus;
•
the fact that New World Development (an affiliate of the Sponsor) has commercial arrangements with Prenetics regarding product promotion and distribution and storefront and office space rental; and
•
the fact that Mr. Yin Pan Cheng, a current director of Artisan, is expected to become a director of PubCo and in such case would be compensated as a director of PubCo.
Q:
I am an Artisan shareholder. Do I have redemption rights?
A:
Yes. Pursuant to the Artisan Articles, in connection with the completion of the Business Combination, Artisan Public Shareholders may elect to have their Artisan Public Shares redeemed for cash at the applicable redemption price per share calculated in accordance with the Artisan Articles. In this proxy statement/prospectus, these rights to demand redemption of the Artisan Public Shares are sometimes referred to as “redemption rights.” For illustrative purposes, as of , 2022, this redemption amount would have amounted to approximately $10 per share. There are currently no owed but unpaid income taxes on the funds in the trust account. However, the proceeds deposited in the trust account could become subject to the claims of Artisan’s creditors, if any, which would have priority over the claims of Artisan shareholders. Therefore, the per share distribution from the trust account in such a situation may be less than originally expected due to such claims. It is expected that the funds to be distributed to Artisan Public Shareholders electing to redeem their Artisan Public Shares shall be distributed promptly after the consummation of the Business Combination. If an Artisan Public Shareholder exercises its redemption rights, then such holder shall be exchanging its Artisan Public Shares for cash. Such a holder shall be entitled to receive cash for its Artisan Public Shares only if it properly demands redemption and delivers its share certificates (if any) or shares (either physically or electronically) to Continental, Artisan’s transfer agent, in the manner described in this proxy/registration statement, at least two business days prior to the vote at the Extraordinary General Meeting. An Artisan Public Shareholder, together with any affiliate of such holder and any person with whom such holder is acting in concert or as a “group” (as defined under Section 13(d)(3) of the Exchange Act), may not seek to have more than 15% of the aggregate Artisan Public Shares redeemed without the prior consent of Artisan. Additionally, under the Artisan Articles, in no event will Artisan redeem Artisan Public Shares in an amount that would cause its net tangible assets to be less than $5,000,001, such that Artisan is not subject to the SEC’s “penny stock” rules. In accordance with the Business Combination Agreement, if the cash proceeds from the trust account, plus cash proceeds from the PIPE Investment and under the Amended Forward Purchase Agreements, plus any amount raised pursuant to permitted equity financings prior to closing of the Acquisition Merger, minus the aggregate amount payable to Artisan Public Shareholders exercising their redemption rights, in the aggregate equaling no less than $200,000,000, the closing condition is not satisfied and therefore, the Business Combination may not be consummated. See “Extraordinary General Meeting of Artisan shareholders — Redemption Rights” for the procedures to be followed if you wish to redeem your shares for cash.
In addition, if a shareholder does not redeem its Artisan Public Shares, but other shareholders do elect to redeem their respective Artisan Public Shares, the non-redeeming shareholders would own shares with a higher implied transaction value per share. The more redemptions of Artisan Public Shares there are, the higher the Class A Exchange Ratio. As the number of redemptions of Artisan Public Shares increases (subject to a cap of 70% redemptions), the Class A Exchange Ratio increases. As the Class A Exchange Ratio increases, the number of PubCo Class A Ordinary Shares issuable per share of Artisan Public Shares held by Artisan Public Shareholders after redemption will also increase. For informational purposes only, please see the table below for an illustration of the foregoing paragraph.
17
|
Percentage of Maximum Redemption(1)
|
| |
0.0%
|
| |
25.0%
|
| |
50.0%
|
| |
75.0%
|
| |
91.6%
|
| |
100.0%
|
| ||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
(resulting in
maximum exchange ratio) |
| | | | | | | |||
| Implied Price Per Share | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||
|
Percentage of Public Shares Redeemed
|
| | | | 0.0% | | | | | | 19.1% | | | | | | 38.2% | | | | | | 57.3% | | | | | | 70.0% | | | | | | 76.4% | | |
|
Percentage of Public Shares Not Redeemed
|
| | | | 100.0% | | | | | | 80.9% | | | | | | 61.8% | | | | | | 42.7% | | | | | | 30.0% | | | | | | 23.6% | | |
|
Trust Account Size (in millions)
|
| | | $ | 339.3 | | | | | $ | 274.5 | | | | | $ | 209.7 | | | | | $ | 144.8 | | | | | $ | 101.8 | | | | | $ | 80.0 | | |
|
Assumed Price Per Artisan Public Share at Closing of SPAC Merger
|
| | | $ | 10.00 | | | | | $ | 10.00 | | | | | $ | 10.00 | | | | | $ | 10.00 | | | | | $ | 10.00 | | | | | $ | 10.00 | | |
|
Remaining Public Shares (in millions)
|
| | | | 33.93 | | | | | | 27.45 | | | | | | 20.97 | | | | | | 14.48 | | | | | | 10.18 | | | | | | 8.00 | | |
|
Additional Artisan Public Shares Available to Non-Redeeming Holders (in
millions) |
| | | | 3.00 | | | | | | 3.00 | | | | | | 3.00 | | | | | | 3.00 | | | | | | 3.00 | | | | | | 2.36 | | |
|
Class A Exchange Ratio
|
| | | | 1.09 | | | | | | 1.11 | | | | | | 1.14 | | | | | | 1.21 | | | | | | 1.29 | | | | | | 1.29 | | |
|
Implied Price Per Artisan Public Share
|
| | | $ | 9.19 | | | | | $ | 9.01 | | | | | $ | 8.75 | | | | | $ | 8.28 | | | | | $ | 7.72 | | | | | $ | 7.72 | | |
|
Implied Initial Merger Consideration Per Artisan Public Share
|
| | | $ | 10.88 | | | | | $ | 11.09 | | | | | $ | 11.43 | | | | | $ | 12.07 | | | | | $ | 12.95 | | | | | $ | 12.95 | | |
(1)
“Maximum Redemption” refers to the scenario where 25,931,200 Artisan Public Shares, or 76.4% of the total Artisan Public Shares, are redeemed for aggregate redemption payments of $259,312,000 (based on the estimated per share redemption price of approximately $10.00 per share) from the Trust Account, which is the estimated maximum number of redemptions that could occur without a failure to satisfy a condition to the Closing under the Business Combination Agreement that the Available Closing Cash Amount is no less than $200,000,000 (the “Minimum Cash Condition”). The Minimum Cash Condition is for the benefit of Prenetics and, as a result, Prenetics has the sole right to waive the Minimum Cash Condition and, subject to satisfaction or waiver of the other conditions to the closing of the Business Combination, to cause the closing of the Business Combination to occur even if the Minimum Cash Condition is not satisfied.
For illustrative purposes only, assuming a price of $10.00 per Artisan Public Share at the Closing, non-redeeming shareholders would receive, in exchange for each Artisan Public Share held, PubCo Class A Ordinary Shares with a value equating to between $10.88 (assuming no redemptions) and $12.95 (assuming maximum redemptions).
Additionally, the PubCo Warrants are expected to be adjusted such that the number of PubCo Class A Ordinary Shares underlying each PubCo Warrant is equal to the number of Artisan Public Shares underlying the Artisan Warrants multiplied by the Class A Exchange Ratio. Such increase means that the public shareholders’ holdings in Artisan will be diluted in comparison to those of the holders of Artisan Warrants at the Closing of the transactions contemplated by the Business Combination Agreement as no Artisan Warrants will be redeemed in connection with the Business Combination.
Q:
Will how I vote affect my ability to exercise redemption rights?
A:
No. An Artisan Public Shareholder may exercise redemption rights regardless of whether he, she or it votes, “FOR” or “AGAINST” the Business Combination Proposal, the Initial Merger Proposal or the Adjournment Proposal or does not vote on such proposals at all. As a result, the Business Combination Agreement can be approved by shareholders who shall redeem their shares and no longer remain shareholders, leaving shareholders who choose not to redeem their shares holding shares in a company with a potentially less liquid trading market, fewer shareholders and the potential inability to meet the NASDAQ listing standards.
18
Q:
How do I exercise my redemption rights?
A:
If you are an Artisan Public Shareholder and wish to exercise your right to have your Artisan Public Shares redeemed, you must:
•
submit a written request to Continental, Artisan’s transfer agent, in which you (i) request that Artisan redeem all or a portion of your Artisan Public Shares for cash, and (ii) identify yourself as the beneficial holder of the Artisan Public Shares and provide your legal name, phone number and address; and
•
either tender your share certificates (if any) to Continental, Artisan’s transfer agent, or deliver your Artisan Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC (Deposit/Withdrawal at Custodian) System.
Holders must complete the procedures for electing to redeem their Artisan Public Shares in the manner described above prior to on , 2022, two business days prior to the vote at the Extraordinary General Meeting in order for their Artisan Public Shares to be redeemed.
The address of Continental, Artisan’s transfer agent, is listed under the question “Who can help answer my questions?” below.
There is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC system. The transfer agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not to pass this cost on to the redeeming shareholder. In the event the Business Combination is not consummated this may result in an additional cost to shareholders for the return of their shares.
If you hold the Artisan Public Shares in “street name,” you will have to coordinate with your broker or bank to have the Artisan Public Shares you beneficially own certificated and delivered electronically.
Holders of Units must elect to separate the Units into the underlying Artisan Public Shares and Artisan Public Warrants prior to exercising redemption rights with respect to the Artisan Public Shares. If holders hold their Units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the Units into the underlying Artisan Public Shares and Artisan Public Warrants, or if a holder holds Units registered in its own name, the holder must contact Continental, Artisan’s transfer agent, directly and instruct it to do so. The redemption rights include the requirement that a holder must identify itself in writing as a beneficial holder and provide its legal name, phone number and address to Continental in order to validly redeem its Artisan Public Shares.
If the Business Combination is not consummated, the Artisan Public Shares will not be redeemed and instead will be returned to the respective holder, broker or bank. In such case, Artisan shareholders may only share in the assets of the trust account upon the liquidation of Artisan. This may result in Artisan shareholders receiving less than they would have received if the Business Combination was completed and they had exercised redemption rights in connection therewith due to potential claims of creditors.
If an Artisan Public Shareholder satisfies the requirements for exercising redemption rights with respect to all or a portion of the Artisan Public Shares he, she or it holds and the Business Combination is consummated, Artisan will redeem such Artisan Public Shares for a per-share price, payable in cash, equal to the pro rata portion of the amount on deposit in the trust account calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the funds held in the trust account and not previously released to Artisan to pay income taxes (less up to $100,000 of interest to pay dissolution expenses). For illustrative purposes, as of , 2022, this would have amounted to approximately $ per issued and outstanding Artisan Public Share. There are currently no owed but unpaid income taxes on the funds in the trust account. However, the proceeds deposited in the trust account could become subject to the claims of Artisan’s creditors, if any, which would have priority over the claims of Artisan shareholders. Therefore, the per share distribution from the trust account in such a situation may be less than originally expected due to such claims. It is expected that the funds to be distributed to Artisan Public Shareholders electing to redeem their Artisan Public Shares shall be distributed promptly after the consummation of the Business Combination.
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Any request for redemption, once made by an Artisan Public Shareholder, may be withdrawn at any time up to two business days prior to the vote at Extraordinary General Meeting. After this time, a request for redemption may not be withdrawn unless the Artisan Board determines (in its sole discretion) to permit the withdrawal of such redemption request (which it may do in whole or in part). Such a request must be made by contacting Continental, Artisan’s transfer agent, at the phone number or address listed under the question “Who can help answer my questions?” below.
No request for redemption shall be honored unless the holder’s share certificates (if any) or shares have been delivered (either physically or electronically) to Continental, Artisan’s transfer agent, in the manner described above, at least two business days prior to the vote at the Extraordinary General Meeting.
If you exercise your redemption rights, then you shall be exchanging your Artisan Public Shares for cash and shall not be entitled to receive any PubCo Class A Ordinary Shares in respect of such redeemed shares upon consummation of the Business Combination.
If you are a holder of Artisan Public Shares and you exercise your redemption rights, such exercise shall not result in the loss of any Artisan Warrants that you may hold.
The closing price of Artisan Public Shares on the record date was $ . The cash held in the trust account on such date was approximately $ million (approximately $ per Artisan Public Share). Prior to exercising redemption rights, Artisan Public Shareholders should verify the market price of Artisan Public Shares as they may receive higher proceeds from the sale of their Artisan Public Shares in the public market than from exercising their redemption rights if the market price per share is higher than the redemption price. Artisan cannot assure its shareholders that they shall be able to sell their Artisan Public Shares in the open market, even if the market price per share is higher than the redemption price stated above, as there may not be sufficient liquidity in its securities when its shareholders wish to sell their shares
See “Extraordinary General Meeting of Artisan shareholders — Redemption Rights” for the procedures to be followed if you wish to redeem your shares for cash.
Q:
If I am a holder of Artisan Warrants, can I exercise redemption rights with respect to my warrants?
A:
No. The holders of Artisan Warrants have no redemption rights with respect to such securities.
Q:
If I am a Unit holder, can I exercise redemption rights with respect to my Units?
A:
Not without first separating the Units. Holders of outstanding Units must separate the Units into the underlying Artisan Public Shares and Artisan Public Warrants prior to exercising redemption rights with respect to Artisan Public Shares.
If a broker, bank, or other nominee holds your Units, you must instruct such broker, bank or nominee to separate your Units. Your nominee must send written instructions by facsimile to Continental, Artisan’s transfer agent. Such written instructions must include the number of Units to be split and the nominee holding such Units. Your nominee must also initiate electronically, using The Depository Trust Company’s DWAC (Deposit/Withdrawal at Custodian) System, a withdrawal of the relevant Units and a deposit of the number of Artisan Public Shares and Artisan Public Warrants represented by such Units. This must be completed far enough in advance to permit your nominee to exercise your redemption rights upon the separation of the Artisan Public Shares from the Units. While this is typically done electronically the same business day, you should allow at least one full business day to accomplish the separation. If you fail to cause your shares to be separated in a timely manner, you shall likely not be able to exercise your redemption rights.
If you hold Units registered in your own name, you must deliver the certificate for such Units to Continental, Artisan’s transfer agent, with written instructions to separate such Units into Artisan Public Shares and Artisan Public Warrants. This must be completed far enough in advance to permit the mailing of the share certificates back to you so that you may then exercise your redemption rights
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upon the separation of the Artisan Public Shares from the Units. See “How do I exercise my redemption rights?” above. The address of Continental is listed under the question “Who can help answer my questions?” below.
Q:
What happens if a substantial number of Artisan shareholders vote in favor of the Business Combination Proposal and the Initial Merger Proposal and exercise their redemption rights?
Artisan Public Shareholders may vote in favor of the Business Combination Proposal and the Initial Merger Proposal and exercise their redemption rights, although they are not required to vote in any way to exercise such redemption rights. Accordingly, the Business Combination may be consummated even though the funds available from the trust account and the number of Artisan shareholders are substantially reduced as a result of redemption by Artisan Public Shareholders.
The Artisan Articles provide that in no event will Artisan redeem Artisan Public Shares in an amount that would cause its net tangible assets to be less than $5,000,001, such that Artisan is not subject to the SEC’s “penny stock” rules. In the event of significant redemptions, with fewer shares and Artisan shareholders, the trading market for PubCo Class A Ordinary Shares may be less liquid than the market for Artisan Public Shares was prior to the Business Combination. In addition, in the event of significant redemptions, PubCo may not be able to meet the NASDAQ listing standards. It is a condition to consummation of the Business Combination in the Business Combination Agreement that the PubCo Class A Ordinary Shares to be issued in connection with the Business Combination shall have been approved for listing on NASDAQ, subject only to official notice of issuance thereof. PubCo and Artisan have certain obligations in the Business Combination Agreement to use reasonable best efforts in connection with the Business Combination, including with respect to satisfying this NASDAQ listing condition.
In addition, consummation of the transactions contemplated by the Business Combination Agreement is subject to the condition that the cash proceeds from the trust account, plus cash proceeds from the PIPE Investment and cash proceeds under the Forward Purchase Agreements, plus any amount raised pursuant to permitted equity financings prior to closing of the Acquisition Merger, minus the aggregate amount payable to Artisan Public Shareholders exercising their redemption rights, in the aggregate equaling no less than $200,000,000.
Q:
Do I have appraisal or dissenters’ rights if I object to the proposed Business Combination?
A:
Holders of record of Artisan Shares may have appraisal rights in connection with the Business Combination under the Cayman Islands Companies Act. In this proxy statement/prospectus, these appraisal or dissent rights are sometimes referred to as “Dissent Rights”. Holders of record of Artisan Shares wishing to exercise such Dissent Rights and make a demand for payment of the fair value for his, her or its Artisan Shares must give written objection to the Initial Merger to Artisan prior to the shareholder vote at the Extraordinary General Meeting to approve the Initial Merger and follow the procedures set out in Section 238 of the Cayman Islands Companies Act, noting that any such dissenter rights may subsequently be lost and extinguished pursuant to Section 239 of the Cayman Islands Companies Act which states that no such dissenter rights shall be available in respect of shares of any class for which an open market exists on a recognized stock exchange or recognized interdealer quotation system at the expiry date of the period allowed for written notice of an election to dissent provided that the merger consideration constitutes inter alia shares of any company which at the effective date of the merger are listed on a national securities exchange. The Business Combination Agreement provides that, if any Artisan shareholder exercises Dissent Rights then, unless Artisan and Prenetics elect by agreement in writing otherwise, the Initial Merger shall not be consummated before the expiry date of the period allowed for written notice of an election to dissent in order to invoke the exemption under Section 239 of the Cayman Islands Companies Act. Artisan believes that such fair value would equal the amount that Artisan shareholders would obtain if they exercised their redemption rights as described herein. An Artisan shareholder which elects to exercise Dissent Rights must do so in respect of all of the Artisan Shares that person holds and will lose their right to exercise their redemption rights as described herein. See the section of this proxy statement/prospectus titled “Extraordinary General Meeting of Artisan Shareholders — Appraisal Rights under the Cayman Islands Companies Act.”
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Artisan shareholders are recommended to seek their own advice as soon as possible on the application and procedure to be followed in respect of the appraisal rights under the Cayman Islands Companies Act.
Q:
Can I exercise redemption rights and appraisal or dissenters’ rights under the Cayman Islands Companies Act?
A:
No. Any Artisan Public Shareholder who elects to exercise Dissent Rights (which dissenter rights are discussed in the section titled “Do I have appraisal rights if I object to the proposed Business Combination?”) will lose their right to have their Artisan Public Shares redeemed in accordance with the Artisan Articles. The certainty provided by the redemption process may be preferable for Artisan Public Shareholders wishing to exchange their Artisan Public Shares for cash. This is because Dissent Rights may be lost or extinguished, including where Artisan and the other parties to the Business Combination Agreement determine to delay the consummation of the Business Combination in order to invoke the limitation on dissenter rights under Section 239 of the Cayman Islands Companies Act, in which case any Artisan Public Shareholder who has sought to exercise Dissent Rights would only be entitled to receive the merger consideration comprising the number of newly issued PubCo Class A Ordinary Shares equal to the Class A Exchange Ratio for each of their Artisan Public Shares.
Q:
I am an Artisan warrantholder. Why am I receiving this proxy statement/prospectus?
A:
As a holder of Artisan Warrants, which shall, as a result of the Business Combination, become PubCo Warrants, you shall be entitled to purchase such number of PubCo Class A Ordinary Share equal to the Class A Exchange Ratio in lieu of one Artisan Public Share at a purchase price of $11.50 upon consummation of the Business Combination. This proxy statement/prospectus includes important information about PubCo and the business of PubCo and its subsidiaries following consummation of the Business Combination. Since holders of Artisan Warrants shall become holders of PubCo Warrants and may become holders of PubCo Class A Ordinary Shares upon consummation of the Business Combination, we urge you to read the information contained in this proxy statement/prospectus carefully.
Q:
What happens to the funds deposited in the trust account after consummation of the Business Combination?
A:
Of the net proceeds of the IPO, including the underwriters’ partial exercise of their over-allotment option, and the concurrent private placements, a total of $339,342,350 was placed in the trust account. After consummation of the Business Combination, the funds in the trust account shall be released to Artisan Merger Sub (as the surviving entity in the Initial Merger) and used by Artisan Merger Sub to pay Artisan Public Shareholders who exercise redemption rights and to pay fees and expenses incurred in connection with the Business Combination with Prenetics (including fees of an aggregate of approximately $11,876,982 to certain underwriters in connection with the IPO). Any remaining cash will be used for working capital and general corporate purposes.
Q:
What happens if the Business Combination is not consummated?
A:
If Artisan does not complete the Business Combination with Prenetics (or another initial business combination) by the Final Redemption Date, Artisan must redeem 100% of the outstanding Artisan Public Shares, at a per-share price, payable in cash, equal to the amount then held in the trust account (net of taxes payable and less up to $100,000 of interest to pay dissolution expenses) divided by the number of outstanding Artisan Public Shares.
Q:
When do you expect the Business Combination to be completed?
A:
It is currently expected that the Business Combination will be consummated in the first half of 2022, promptly following the satisfaction, or waiver, of the conditions precedent to Closing set forth in the Business Combination Agreement, including the approval of the Business Combination Proposal and the Initial Merger Proposal by the holders of Artisan Shares. For a description of the conditions for the completion of the Business Combination, see “The Business Combination Agreement — The Business Combination Agreement — Conditions to Closing.”
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Q:
What else do I need to do now?
A:
Artisan urges you to read carefully and consider the information contained in this proxy statement/prospectus, including the Annexes, and to consider how the Business Combination shall affect you as a shareholder and/or warrantholder of Artisan. Shareholders should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus and on the enclosed proxy card.
Q:
When and where will the Extraordinary General Meeting take place?
A:
The Extraordinary General Meeting will be held on , 2022, at a.m., Eastern Time, at and virtually over the Internet by means of a live audio webcast. You may attend the Extraordinary General Meeting webcast by accessing the web portal located at https://www.cstproxy.com/artisanacquisition/2022 and following the instructions set forth below. In order to maintain the interactive nature of the Extraordinary General Meeting, virtual attendees who have registered for the meeting and entered a valid control number will be able to:
•
vote via the web portal during the Extraordinary General Meeting webcast; and
•
submit questions to the chairman during the Extraordinary General Meeting.
Shareholders who have registered for the meeting and entered a valid control number may submit questions to the chairman during the meeting through the Extraordinary General Meeting webcast by typing in the “Submit a question” box.
A separate conference line to allow participants to communicate with each other during the Extraordinary General Meeting will also be made available.
Q:
How do I attend the Extraordinary General Meeting?
A:
Due to health concerns stemming from the COVID-19 pandemic and to support the health and well-being of Artisan’s shareholders, you are encouraged to attend the Extraordinary General Meeting virtually. To register for and attend the Extraordinary General Meeting virtually, please follow these instructions as applicable to the nature of your ownership of Artisan Shares:
•
Shares Held of Record. If you are a record holder, and you wish to attend the Extraordinary General Meeting virtually, go to https://www.cstproxy.com/artisanacquisition/2022, enter the control number you received on your proxy card or notice of the meeting and click on the “Click here to register for the online meeting” link at the top of the page. Immediately prior to the start of the Extraordinary General Meeting, you will need to log back into the meeting site using your control number.
•
Shares Held in Street Name. If you hold your Artisan Shares in “street” name, which means your shares are held of record by a broker, bank or nominee, and you wish to attend the Extraordinary General Meeting virtually, you must obtain a legal proxy from the shareholder of record and e-mail a copy (a legible photograph is sufficient) of your proxy to proxy@continentalstock.com no later than 72 hours prior to the Extraordinary General Meeting. Holders should contact their broker, bank or nominee for instructions regarding obtaining a proxy. Holders who e-mail a valid legal proxy will be issued a meeting control number that will allow them to register to attend and participate in the Extraordinary General Meeting. You will receive an e-mail prior to the meeting with a link and instructions for entering the Extraordinary General Meeting. “Street” name holders should contact Continental on or before , 2022.
Shareholders will also have the option to listen to the Extraordinary General Meeting by telephone by calling:
•
Within the U.S. and Canada: 1 800-450-7155 (toll-free)
•
Outside of the U.S. and Canada: +1 857-999-9155 (standard rates apply)
The passcode for telephone access: 5061231#. You will not be able to vote or submit questions unless you register for and log in to the Extraordinary General Meeting webcast as described above.
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Q:
How do I vote?
A:
If you are a holder of record of Artisan Shares at close of business on the record date, you may vote electronically at the Extraordinary General Meeting by navigating to and entering the control number on your proxy card or by submitting a proxy for the Extraordinary General Meeting. You may submit your proxy by completing, signing, dating and returning the enclosed proxy card in the accompanying pre-addressed postage paid envelope so as to be received by Artisan no later than at AM time, on , 2022, being 48 hours before the time appointed for the holding of the Extraordinary General Meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting). If you hold your Artisan Shares in “street name,” which means your shares are held of record by a broker, bank or nominee, you should contact your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the broker, bank or nominee with instructions on how to vote your shares or, if you wish to attend the Extraordinary General Meeting and vote remotely, obtain a legal proxy from your broker, bank or nominee and a control number from Continental, available once you have received your proxy by emailing proxy@continentalstock.com.
Q:
If my shares are held in “street name,” will my broker, bank or nominee automatically vote my shares for me?
A:
No. As disclosed in this proxy statement/prospectus, your broker, bank or nominee cannot vote your shares on the Business Combination Proposal, the Initial Merger Proposal or the Adjournment Proposal unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank or nominee. If you are an Artisan shareholder holding your shares in “street name” and you do not instruct your broker, bank or other nominee on how to vote your shares, your broker, bank or other nominee will not vote your shares on the Business Combination Proposal, the Initial Merger Proposal or the Adjournment Proposal. Such abstentions and broker non-votes will have no effect on the vote count for any of the Proposals.
Q:
May I change my vote after I have mailed my signed proxy card?
A:
Yes. If you are a holder of record of Artisan Shares and you give a proxy, you may revoke it at any time before it is exercised by doing any one of the following:
•
you may send another signed proxy card to Continental, Artisan’s transfer agent, at the address set forth under the question “Who can help answer my questions?” below so that it is received no later than 48 hours before the time appointed for the holding of the Extraordinary General Meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting);
•
you may notify the Artisan Board in writing, prior to the vote at the Extraordinary General Meeting, that you have revoked your proxy; or
•
you may attend the Extraordinary General Meeting virtually over the Internet by joining the live audio webcast and vote electronically through the web portal during the Extraordinary General Meeting, although your attendance alone will not revoke any proxy that you have previously given.
If you hold your Artisan Shares in “street name,” you may submit new instructions on how to vote your shares by contacting your broker, bank or nominee.
Q:
What happens if I fail to take any action with respect to the Extraordinary General Meeting?
A:
If you fail to take any action with respect to the Extraordinary General Meeting and the Business Combination is approved by shareholders and consummated, you shall become a shareholder and/or warrantholder of PubCo. If you fail to take any action with respect to the Extraordinary General Meeting and the Business Combination is not approved, you shall continue to be a shareholder and/or warrantholder of Artisan.
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Q:
What should I do if I receive more than one set of voting materials?
A:
Shareholders may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus and multiple proxy cards or voting instruction cards. For example, if you hold your Artisan Shares in more than one brokerage account, you shall receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you shall receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast a vote with respect to all of your Artisan Shares.
Q:
What happens if I sell my Artisan Shares before the Extraordinary General Meeting?
A:
The record date for the Extraordinary General Meeting is earlier than the date of the Extraordinary General Meeting and earlier than the date the Business Combination is expected to be completed. If you transfer your Artisan Shares after the applicable record date, but before the Extraordinary General Meeting date, unless you grant a proxy to the transferee, you shall retain your right to vote at the Extraordinary General Meeting.
Q:
Who will solicit and pay the cost of soliciting proxies for the Extraordinary General Meeting?
A:
Artisan will pay the cost of soliciting proxies for the Extraordinary General Meeting. Artisan has engaged Morrow Sodali LLC to assist in the solicitation of proxies for the Extraordinary General Meeting. Artisan has agreed to pay that firm a fixed fee of $37,500, plus associated disbursements, to reimburse the firm for its reasonable and documented costs and expenses and to indemnify the firm and its affiliates against certain claims, liabilities, losses, damages and expenses. Artisan will also reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of Artisan Public Shares for their expenses in forwarding soliciting materials to beneficial owners of Artisan Public Shares and in obtaining voting instructions from those owners. Artisan’s directors and officer may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person. They will not be paid any additional amounts for soliciting proxies.
Q:
Where can I find the voting results of the Extraordinary General Meeting?
A:
The preliminary voting results will be announced at the Extraordinary General Meeting. Artisan will publish final voting results of the Extraordinary General Meeting in a Current Report on Form 8-K within four business days after the Extraordinary General Meeting.
Q:
Who can help answer my questions?
A:
If you have questions about the proposals or if you need additional copies of this proxy statement/prospectus or the enclosed proxy card you should contact Artisan’s proxy solicitor as follows:
Morrow Sodali LLC
333 Ludlow Street, 5th Floor, South Tower
Stamford CT 06902
Telephone: (800) 662-5200
(Banks and brokers can call: (203) 658-9400)
Email: ARTA.info@investor.morrowsodali.com
333 Ludlow Street, 5th Floor, South Tower
Stamford CT 06902
Telephone: (800) 662-5200
(Banks and brokers can call: (203) 658-9400)
Email: ARTA.info@investor.morrowsodali.com
To obtain timely delivery, shareholders must request the materials no later than , 2022, or five business days prior to the Extraordinary General Meeting
You may also obtain additional information about Artisan from documents filed with the SEC by following the instructions in the section entitled “Where You Can Find More Information.”
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If you are an Artisan Public Shareholder and you intend to seek redemption of your Artisan Public Shares, you shall need to either tender your share certificates (if any) to Continental, Artisan’s transfer agent, at the address below or deliver your Artisan Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC System, in each case at least two business days prior to the vote at the Extraordinary General Meeting. If you have questions regarding the certification of your position or delivery of your shares for redemption, please contact Artisan’s transfer agent as follows:
Continental Stock Transfer & Trust Company
1 State Street 30th Floor
New York, NY 10004-1561
Attn: Mark Zimkind
Email: mzimkind@continentalstock.com
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SUMMARY OF THE PROXY STATEMENT/PROSPECTUS
This summary highlights selected information from this proxy statement/prospectus and does not contain all of the information that is important to you. To better understand the proposals to be submitted for a vote at the Extraordinary General Meeting, including the Business Combination, you should read this entire document carefully, including the Business Combination Agreement attached as Annex A to this proxy statement/prospectus. The Business Combination Agreement is the legal document that governs the Business Combination and the other transactions that shall be undertaken in connection with the Business Combination. It is also described in detail in this proxy statement/prospectus in the section entitled “The Business Combination Proposal — The Business Combination Agreement.”
The Parties to the Business Combination
Prenetics
Prenetics Group is a major diagnostics and genetics testing products and services provider, with a team of more than 800 employees and operations across nine locations, including the U.K., Hong Kong, India, South Africa and Southeast Asia. Prenetics Group’s business was founded in 2014 with the mission to bring health closer to millions of people globally and decentralize healthcare by making the three pillars — Prevention, Diagnostics and Personalized Care — comprehensive and accessible to anyone, at anytime and anywhere. Prenetics Group intends to construct a global healthcare ecosystem to disrupt and decentralize the conventional healthcare system and improve its customers’ wellbeing through comprehensive genetic and diagnostic testing.
Prenetics HK was the holding company of Prenetics Group’s businesses until June 2021. Prenetics is an exempted company limited by shares incorporated under the laws of the Cayman Islands on February 8, 2018. In May 2021, Prenetics HK entered into a share exchange agreement and subscription agreement with, among others, the then existing shareholders of Prenetics HK and Prenetics, upon completion of the transactions thereunder in June 2021, Prenetics HK became a wholly-owned subsidiary of Prenetics and the then existing shareholders of Prenetics HK became shareholders of Prenetics. Prenetics HK continues to hold the same corporate structure. The mailing address of Prenetics’ principal executive office is Unit 701-706, K11 Atelier King’s Road, 728 King’s Road, Quarry Bay, Hong Kong, and its phone number is +852-2210-9588. Prenetics’ corporate website address is https://www.prenetics.com/. Prenetics’ website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this proxy statement/prospectus. After the consummation of the Business Combination, Prenetics will become a wholly owned subsidiary of PubCo.
Prenetics Group currently does not have any business operations in mainland China, and Prenetics believes that, based on the advice of its outside PRC counsel, DaHui Lawyers, it is currently not required to obtain any permission or approval from the China Securities Regulatory Commission (“CSRC”), Cyberspace Administration of China (“CAC”) or any other PRC governmental authority to operate its business or to list its securities on a U.S. securities exchange or issue securities to foreign investors.
However, there is no guarantee that this will continue to be the case in the future in relation to the listing or continued listing of PubCo’s securities on a U.S. securities exchange, or even in the event such permission or approval is required and obtained, it will not be subsequently revoked or rescinded. Any actions by the PRC government to exert more influence, oversight and control over listings (including of businesses whose primary operations are in Hong Kong) that are conducted overseas and/or foreign investments in Hong Kong-based companies could significantly limit or completely hinder PubCo’s ability to offer or continue to offer securities to investors and cause the value of PubCo’s securities to significantly decline or be worthless.
27
Corporate Structure of Prenetics Group
Historically, Prenetics HK held a minority interest in Beijing CircleDNA Gene Technology Co., Ltd, a PRC domestic company operating a genomics business in mainland China through a series of contractual arrangements with the VIE Entity (the “China Investment”). For the financial year ended December 31, 2020, Prenetics wrote down the carrying amount of the interest in the China Investment to its recoverable amount of nil, because Prenetics’ share of losses exceeded its interest in the China Investment. Considering that Prenetics Group currently has no intention to carry out business operations in mainland China and that the China Investment had limited strategic and financial value, on November 26, 2021, each of the agreements governing the VIE Entity was terminated with immediate effect. As a result, the corporate structure of Prenetics Group no longer contains any VIE. The following diagram illustrates the corporate structure of Prenetics Group prior to the termination of the VIE agreements.
![[MISSING IMAGE: tm2127588d52-fc_corpnewbw.jpg]](https://cdn.kscope.io/f7c0634e1cbf4f161664dcff4bb19324-tm2127588d52-fc_corpnewbw.jpg)
The following diagram illustrates the corporate structure of Prenetics Group as of the date of this proxy statement/prospectus.
![[MISSING IMAGE: tm2127588d52-fc_bussinbw.jpg]](https://cdn.kscope.io/f7c0634e1cbf4f161664dcff4bb19324-tm2127588d52-fc_bussinbw.jpg)
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Artisan
Artisan is a blank check company incorporated on February 2, 2021, as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. Based on its business activities, Artisan is a “shell company,” as defined under the Exchange Act, because it has no operations and nominal assets consisting almost entirely of cash.
Before the completion of an initial business combination, any vacancy on the Artisan Board may be filled by a nominee chosen by holders of a majority of its Founder Shares. In addition, before the completion of an initial business combination, holders of a majority of the Founder Shares may remove a member of the Artisan Board for any reason.
On May 18, 2021, Artisan consummated its IPO of 30,000,000 Units, at $10.00 per unit, and a concurrent private placement with the Sponsor of 5,333,333 Artisan Private Warrants at a price of $1.50 per warrant. Each Unit consists of one Artisan Public Share and one-third of one Artisan Public Warrant. On May 25, 2021, Artisan consummated the closing of its sale of an additional 3,934,235 Units pursuant to the partial exercise by the underwriters of their over-allotment option and a concurrent private placement with the Sponsor of 524,565 Artisan Private Warrants. As a result, an amount equal to $339,342,350 of the net proceeds was placed in the trust account. The trust account may be invested only in U.S. government treasury bills with a maturity of 180 days or less or in money market funds investing solely in United States Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company Act of 1940, as amended, which invest only in direct U.S. government obligations. As of September 30, 2021, funds in the trust account totaled $339,362,925.
Except with respect to interest earned on the funds held in the trust account that may be released to Artisan to pay income taxes, if any, the Artisan Articles, as discussed below and subject to the requirements of law and regulation, provide that the proceeds held in the trust account will not be released from the trust account (1) to Artisan, until the completion of a business combination, or (2) to Artisan Public Shareholders, until the earliest of (a) the completion of a business combination, and then only in connection with those Artisan Public Shares that such shareholders properly elected to redeem, subject to the limitations described herein, (b) the redemption of any Artisan Public Shares properly tendered in connection with a shareholder vote to amend the Artisan Articles (A) to modify the substance or timing of Artisan’s obligation to provide holders of Artisan Public Shares the right to have their shares redeemed in connection with a business combination or to redeem 100% of the Artisan Public Shares if Artisan does not complete a business combination within 24 months from the closing of the IPO or (B) with respect to any other provision relating to the rights of holders of Artisan Public Shares, and (c) the redemption of Artisan Public Shares if Artisan has not consummated a business combination by the Final Redemption Date, subject to applicable law.
Artisan’s Units, the Artisan Public Shares and Artisan Public Warrants are each traded on NASDAQ under the symbols “ARTAU,” “ARTA” and “ARTAW,” respectively.
Artisan’s registered office is located at 71 Fort Street, PO Box 500, Grand Cayman, KY1-1106 Cayman Islands, and its telephone number is +852 2523 1056.
PubCo
PubCo was incorporated on July 21, 2021, solely for the purpose of effectuating the Business Combination described herein. PubCo was incorporated under the laws of the Cayman Islands as an exempted company limited by shares. PubCo does not own any material assets and does not operate any business.
Immediately following the Business Combination, PubCo will qualify as a foreign private issuer as defined in Rule 3b-4 under the Exchange Act. Immediately following the consummation of the Business Combination, the PubCo Board will consist of five directors including Danny Yeung, the co-founder of Prenetics Group, the Chief Executive Officer of Prenetics HK and chairman of the board of directors of Prenetics, Cheng Yin Pan (Ben), the Chief Executive Officer of Artisan, Cui Zhanfeng, a current director of Prenetics, and two independent directors including Woo Ian Ying and Chiu Wing Kwan (Winnie).
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The mailing address of PubCo is Unit 701-706, K11 Atelier King’s Road, 728 King’s Road, Quarry Bay, Hong Kong. After the consummation of the Business Combination, PubCo will become the continuing public company.
The Business Combination Proposal
On September 15, 2021, Artisan, PubCo, Artisan Merger Sub, Prenetics Merger Sub and Prenetics entered into the Business Combination Agreement, pursuant to which, subject to the terms and conditions set forth therein, (i) Artisan shall merge with and into Artisan Merger Sub, with Artisan Merger Sub being the surviving entity and remaining as a wholly-owned subsidiary of PubCo and (ii) following the Initial Merger, Prenetics Merger Sub shall merge with and into Prenetics, with Prenetics being the surviving entity and becoming a wholly-owned subsidiary of PubCo. On March 30, 2022, Artisan, PubCo, Artisan Merger Sub, Prenetics Merger Sub and Prenetics entered into the BCA Amendment, pursuant to which, among other things, (i) the exchange ratio at which the Artisan Public Shares (excluding Artisan Public Shares that are held by Artisan shareholders that validly exercise their redemption rights, Dissenting Artisan Shares and Artisan treasury shares) will be exchanged for PubCo Class A Ordinary Shares in the Initial Merger is amended from one to the Class A Exchange Ratio, (ii) the number of PubCo Class A Ordinary Shares issuable upon exercise of each PubCo Warrant converted from each whole Artisan Warrant is amended from one to the Class A Exchange Ratio, (iii) the Price per Share for the purpose of calculating the exchange ratio at which Prenetics Share exchange into PubCo Class A Ordinary Shares in the Acquisition Merger is reduced, and (iv) the size of the board of directors of PubCo immediately following the Acquisition Closing will be reduced from six members to five members. Capitalized terms in this summary of the Business Combination Proposal not otherwise defined in this proxy statement/prospectus shall have the meanings ascribed to them in the Business Combination Agreement.
The Initial Merger
As a result of the Initial Merger, at the Initial Merger Effective Time (i) all the property, rights, privileges, agreements, powers and franchises, liabilities and duties of Artisan and Artisan Merger Sub shall vest in and become the property, rights, privileges, agreements, powers and franchises, liabilities and duties of Artisan Merger Sub as the surviving company, and Artisan Merger Sub shall thereafter exist as a wholly-owned subsidiary of PubCo and the separate corporate existence of Artisan shall cease to exist, (ii) each issued and outstanding security of Artisan immediately prior to the Initial Merger Effective Time shall be cancelled in exchange for or converted into securities of PubCo or other rights or property as set out below, (iii) Mr. Yin Pan Cheng (or in the event such person is unable or unwilling to serve as a director, another individual who was a director of Artisan prior to the Initial Closing designated by Artisan in writing) (the “Artisan Director”) shall be appointed as a director on the board of directors of PubCo, in addition to the then existing director of PubCo, the existing officers of PubCo (if any) shall cease to hold office and the initial officers of PubCo from the Initial Merger Effective Time shall be appointed as determined by Prenetics, (iv) the Artisan Director shall be appointed as a director on the board of directors of Artisan Merger Sub and shall hold office until the Acquisition Effective Time, in addition to the then existing director of Artisan Merger Sub, the existing officers of Artisan Merger Sub (if any) shall cease to hold office and the initial officers of Artisan Merger Sub from the Initial Merger Effective Time shall be appointed as determined by Prenetics, (v) Artisan Merger Sub’s memorandum and articles of association shall be amended and restated to read in their entirety in the form attached as Exhibit G to the Business Combination Agreement, and (vi) PubCo’s memorandum and articles of association shall be amended and restated to read in their entirety in the form attached as Exhibit 3.1 to this proxy statement/prospectus.
Subject to the terms and conditions of the Business Combination Agreement, at the Initial Merger Effective Time:
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each Unit issued and outstanding immediately prior to the Initial Merger Effective Time shall be automatically separated and the holder thereof shall be deemed to hold one Artisan Public Share and one-third of an Artisan Public Warrant;
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immediately following the separation of each Unit, each Artisan Public Share (which, for the avoidance of doubt, includes the Artisan Public Shares held as a result of the separation of the Units and Artisan Public Shares issued in the Class B Recapitalization) issued and outstanding
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immediately prior to the Initial Merger Effective Time (excluding Artisan Public Shares that are held by Artisan shareholders that validly exercise their redemption rights, Dissenting Artisan Shares and Artisan treasury shares) shall be cancelled in exchange for the right to receive the number of newly issued PubCo Class A Ordinary Shares equal to the Class A Exchange Ratio;
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each Artisan Warrant (which, for the avoidance of doubt, includes the Artisan Public Warrants held as a result of the separation of Units) outstanding immediately prior to the Initial Merger Effective Time shall cease to be a warrant with respect to Artisan Public Shares and be assumed by PubCo and converted into a warrant to purchase such number of PubCo Class A Ordinary Share equal to the Class A Exchange Ratio, subject to substantially the same terms and conditions prior to the Initial Merger Effective Time in accordance with the provisions of the Assignment, Assumption and Amendment Agreement;
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the single share in the capital of Artisan Merger Sub issued and outstanding immediately prior to the Initial Merger Effective Time and owned by PubCo shall continue existing and constitute the only issued and outstanding share in the capital of Artisan Merger Sub; and
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the holder of one share of PubCo and any other shares of PubCo immediately prior to the Initial Merger Effective Time shall surrender such shares of PubCo for no consideration to PubCo and all such shares of PubCo shall be cancelled by PubCo.
For more information on the Initial Merger and the Initial Merger Proposal, see the sections titled “The Business Combination Proposal — The Initial Merger” and “The Initial Merger Proposal.”
The Acquisition Merger
Following the Initial Merger and the satisfaction of the conditions with respect to the Acquisition Merger, as a result of the Acquisition Merger, at the Acquisition Effective Time (i) all the property, rights, privileges, agreements, powers and franchises, liabilities and duties of Prenetics Merger Sub and Prenetics shall vest in and become the assets and liabilities of Prenetics as the surviving company, and Prenetics shall thereafter exist as a wholly-owned subsidiary of PubCo and the separate corporate existence of Prenetics Merger Sub shall cease to exist, (ii) each issued and outstanding security of Prenetics immediately prior to the Acquisition Effective Time shall be cancelled in exchange for or converted into securities of PubCo or other rights or property as set out below, (iii) each share of Prenetics Merger Sub issued and outstanding immediately prior to the Acquisition Effective Time shall automatically be converted into one ordinary share of the surviving company, (iv) the board of directors and officers of Prenetics Merger Sub shall cease to hold office, and the board of directors and officers of Prenetics shall be as determined by Prenetics and (v) the memorandum and articles of association of Prenetics shall be amended and restated to read in their entirety in the form attached as Exhibit H to the Business Combination Agreement.
Subject to the terms and conditions of the Business Combination Agreement, at the Acquisition Effective Time:
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each Prenetics Ordinary Share and Prenetics Preferred Share (other than Prenetics Key Executive Shares, Prenetics Dissenting Shares and Prenetics treasury shares) issued and outstanding immediately prior to the Acquisition Effective Time shall be cancelled in exchange for the right to receive such fraction of a newly issued PubCo Class A Ordinary Share that is equal to the Exchange Ratio, without interest, subject to rounding up to the nearest whole PubCo Class A Ordinary Share with respect to the total number of PubCo Class A Ordinary Shares to be received by each Prenetics shareholder;
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each Prenetics Key Executive Share issued and outstanding immediately prior to the Acquisition Effective Time shall be cancelled in exchange for the right to receive such fraction of a newly issued PubCo Class B Ordinary Share that is equal to the Exchange Ratio, without interest, without interest, subject to rounding up to the nearest whole PubCo Class B Ordinary Share with respect to the total number of PubCo Class B Ordinary Shares to be received by Danny Yeung;
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each Prenetics RSU outstanding immediately prior to the Acquisition Effective Time, whether vested or unvested, shall be automatically assumed by PubCo and converted into an award of restricted share units representing the right to receive the number of PubCo Class A Ordinary Shares equal to (i) the number of Prenetics Ordinary Shares subject to such Prenetics RSU immediately prior to the
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Acquisition Effective Time multiplied by (ii) the Exchange Ratio (such product rounded down to the nearest whole number), and otherwise, shall be subject to substantially the same terms and conditions as were applicable to such Prenetics RSU immediately prior to the Acquisition Effective Time; and
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each restricted share unit to acquire Prenetics Shares that is held by Danny Yeung (the “Prenetics Key Executive RSU”) that is outstanding immediately prior to the Acquisition Effective Time, whether vested or unvested, shall be automatically assumed by PubCo and converted into an award of restricted share units representing the right to receive the number of PubCo Class B Ordinary Shares equal to (i) the number of Prenetics Ordinary Shares subject to such Prenetics Key Executive RSUs immediately prior to the Acquisition Effective Time multiplied by (ii) the Exchange Ratio (such product rounded down to the nearest whole number), and otherwise, shall be subject to substantially the same terms and conditions as were applicable to such Prenetics Key Executive RSUs immediately prior to the Acquisition Effective Time.
For more information on the Acquisition Merger and the Business Combination Proposal, see the section titled “The Business Combination Proposal — The Acquisition Merger.”
Conditions to Closing
In addition to the approval of the Business Combination Proposal and the Initial Merger Proposal, unless waived by the parties to the Business Combination Agreement, the closing of the Business Combination is subject to a number of conditions set forth in the Business Combination Agreement. For more information about the closing conditions to the Business Combination, see the section titled “The Business Combination Proposal — The Business Combination Agreement — Conditions to Closing.”
Related Agreements
PIPE Financing (Private Placement)
Substantially concurrently with the execution of the Business Combination Agreement, PubCo, Artisan and the PIPE Investors entered into PIPE Subscription Agreements pursuant to which the PIPE Investors have committed to subscribe for and purchase, in the aggregate, 6,000,000 PubCo Class A Ordinary Shares for $10 per share, for an aggregate purchase price equal to $60,000,000. In connection with and concurrently with the execution of the BCA Amendment, Artisan and PubCo entered into an Amendment to PIPE Subscription Agreement with each of the PIPE Investors, respectively, pursuant to which the number of PubCo Class A Ordinary Shares to be purchased by each PIPE Investor immediately prior to the Acquisition Effective Time is increased by multiplying (a) the number of PubCo Class A Ordinary Shares that such PIPE Investor has agreed to purchase under the relevant PIPE Subscription Agreement by (b) the Class A Exchange Ratio, without additional consideration payable by such PIPE Investor. For more information, see the section titled “Agreements Entered Into in Connection with the Business Combination.”
Prenetics Shareholder Support Agreements
Concurrently with the execution of the Business Combination Agreement, Artisan, PubCo, Prenetics and certain shareholders of Prenetics entered into voting support agreements and deeds (the “Prenetics Shareholder Support Agreements”). Following the execution of the Business Combination Agreement and on October 1, 2021, Artisan, PubCo, Prenetics, Artisan Merger Sub, Prenetics Merger Sub and a major shareholder of Prenetics entered into a deed of joinder, pursuant to which such major shareholder of Prenetics agreed to be bound by the terms and conditions of the Prenetics Shareholder Support Agreements. On March 30, 2022, Artisan, Prenetics, PubCo, Danny Yeung and Dr. Lawrence Tzang entered into the Management Shareholder Support Agreement Amendment Deed, pursuant to which the lock-up period applicable to Danny Yeung is amended such that 50% of the PubCo Ordinary Shares to be acquired by him in the Business Combination will be subject to a lock-up for 6 months after consummation of the Business Combination, and the remaining 50% will be subject to a lock-up for 12 months after consummation of the Business Combination, in each case subject to the terms and conditions set forth therein (including an earlier release if certain criteria are met). For more information, see the section titled “Agreements Entered Into in Connection with the Business Combination.”
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Sponsor Support Agreement
Concurrently with the execution of the Business Combination Agreement, Artisan, Sponsor, PubCo and Prenetics entered into a voting support agreement and deed (the “Sponsor Support Agreement”). On March 30, 2022, Artisan, Prenetics, PubCo, Sponsor and the Artisan directors entered into the Sponsor Support Agreement Amendment Deed, pursuant to which the lock-up period applicable to Sponsor is amended such that 50% of the PubCo Ordinary Shares to be acquired by Sponsor in the Business Combination will be subject to a lock-up for 6 months after consummation of the Business Combination, and the remaining 50% will be subject to a lock-up for 12 months after consummation of the Business Combination, in each case subject to the terms and conditions set forth therein (including an earlier release if certain criteria are met). For more information, see the section titled “Agreements Entered Into in Connection with the Business Combination.”
Sponsor Agreement
In connection with and concurrently with the execution of the BCA Amendment, Prenetics, Artisan and PubCo entered into the Sponsor Agreement with the Sponsor and the Artisan independent directors, pursuant to and subject to the terms of which, among other things, immediately prior to the consummation of the Initial Merger, Sponsor and the Artisan independent directors shall contribute, transfer, assign, convey and deliver to Artisan all of their respective right, title and interest in, to and under their Founder Shares in exchange for Artisan Public Shares, and the Sponsor will also surrender and forfeit certain Private Placement Warrants for no consideration. For more information, see the section titled “Agreements Entered Into in Connection with the Business Combination.”
Registration Rights Agreement
Concurrently with the execution of the Business Combination Agreement, Artisan, PubCo, Sponsor and certain shareholders of Prenetics (the “Prenetics Holders”) entered into a registration rights agreement (the “Registration Rights Agreement”), to be effective upon the Closing. Following the execution of the Business Combination Agreement, all existing parties to the Registration Rights Agreement and several shareholders of Prenetics entered into a deed of joinder, pursuant to which such shareholders of Prenetics agreed to be bound by the terms and conditions of, and were granted the registration rights under, the Registration Rights Agreement. For more information, see the sections titled “Agreements Entered Into in Connection with the Business Combination” and “Shares Eligible for Future Sale — Registration Rights.”
Assignment, Assumption and Amendment Agreement
Concurrently with the execution of the Business Combination Agreement, Artisan, PubCo and Continental entered into the Assignment, Assumption and Amendment Agreement and amended the Existing Warrant Agreement, pursuant to which, among other things, Artisan assigned all of its right, title and interest in the Existing Warrant Agreement to PubCo effective upon the Initial Closing, and PubCo assumed the warrants provided for under the Existing Warrant Agreement. For more information, see the section titled “Agreements Entered Into in Connection with the Business Combination.”
Forward Purchase Agreements
Prior to the initial public offering of Artisan, Artisan entered into forward purchase agreements (each a “Forward Purchase Agreement”), pursuant to which the each of the Forward Purchase Investors agreed to purchase an aggregate of 6,000,000 Artisan Public Shares plus 1,500,000 Artisan Public Warrants, for a purchase price of $10.00 per Artisan Public Share, as applicable, or $60,000,000 in the aggregate, in a private placement to close immediately prior to the closing of the initial business combination of Artisan. Concurrently with the execution of the Business Combination Agreement, the Forward Purchase Investors entered into deeds of novation and amendment (each a “Deed of Novation and Amendment”), pursuant to which the Forward Purchase Investors have agreed to replace their commitments to purchase the Artisan Public Shares and Artisan Public Warrants under the Forward Purchase Agreements with the commitments to purchase an aggregate of 6,000,000 PubCo Class A Ordinary Shares plus 1,500,000 PubCo Warrants, for a purchase price of $10.00 per PubCo Class A Ordinary Share, as applicable, or $60,000,000 in the aggregate, in a private placement to close immediately prior to the Closing. In connection with and
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concurrently with the execution of the BCA Amendment, Artisan, PubCo and Sponsor entered into a Deed of Amendment to Deed of Novation and Amendment with each of the Forward Purchase Investors, respectively, pursuant to which (i) the number of PubCo Class A Ordinary Shares to be purchased by each Forward Purchase Investor immediately prior to the Acquisition Effective Time is increased by multiplying (a) the number of PubCo Class A Ordinary Shares that such Forward Purchase Investor has agreed to purchase under the relevant Amended Forward Purchase Agreement by (b) the Class A Exchange Ratio, without additional consideration payable by such Forward Purchase Investor; (ii) the lock-up period applicable to such Forward Purchase Investor is to be amended to six months after the consummation of the Business Combination, subject to an earlier release if certain criteria are met; and (iii) such Forward Purchase Investor shall convert all Founder Shares held by it into Artisan Public Shares on a one-for-one basis immediately prior to the Initial Closing. For more information, see the section titled “Agreements Entered Into in Connection with the Business Combination.”
Lock-Up Agreements
Following the execution of the Business Combination Agreement, certain Prenetics shareholders who were not parties to the relevant Prenetics Shareholders Support Agreement entered into the respective lock-up agreements with PubCo, Prenetics and Artisan (each a “Lock-Up Agreement”), pursuant to which each shareholder agreed to the lock-up arrangements substantially the same as those applicable to the Prenetics shareholders who were parties to the Prenetics Shareholders Support Agreements (other than Danny Yeung), such that the PubCo Ordinary Shares to be acquired by such Prenetics shareholders will be subject to a lock-up for 180 days following the consummation of the Business Combination. After taking the Lock-Up Agreements into account, shareholders of Prenetics representing approximately 96.8% of the issued and outstanding share capital of Prenetics as of the date of this proxy statement/prospectus have agreed to lock up the PubCo Ordinary Shares to be acquired by them following the consummation of the Business Combination Agreement.
The Artisan Board’s Reasons for the Approval of the Business Combination
Artisan was formed to effect a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. As described above, the Artisan Board sought to do so by using the networks and industry experience of both the Sponsor, the Artisan Board, and Artisan management to identify and acquire one or more businesses.
In evaluating the transaction with Prenetics, the Artisan Board consulted with its legal counsel and accounting and other advisors and considered a number of factors. In particular, the Artisan Board considered, among other things, the following factors, although not weighted or in any order of significance:
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Prenetics Group’s Robust Product Portfolio and Pipeline Products Developed Based on Advanced Technologies. Based on Prenetics Group’s robust portfolio of existing and pipeline products developed based on advanced technologies, the Artisan Board believes that Prenetics Group has been establishing a healthcare ecosystem with strong technological and commercial synergies through its existing and pipeline products, which fits Artisan’s business combination criteria as a target in the global healthcare, consumer and technology sectors which have high-growth potential and disruptive technologies and products.
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Prenetics Group’s Strong R&D and Product Innovation Capability. Prenetics Group has a strong R&D and product innovation capability backed by its specialized in-house R&D team, strategic collaboration with the University of Oxford (“Oxford”) and an experienced scientific advisory board. The Artisan Board believes Prenetics Group’s strong R&D and product innovation capability ensures that its products remain differentiated from those of its peers and creates entry barriers.
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Prenetics Group’s Strong Capability and Proven Track Record in Commercializing Technologies and Agility to React to New Market Demand. Prenetics Group has strong capability and a proven track record in transforming technologies into commercial products and healthcare services that appeal to customers and effectively address their needs. The Artisan Board believes Prenetics Group’s success in CircleDNA and COVID-19 testing validates Prenetics Group’s ability to commercialize products timely to meet market needs and provides a solid foundation for Prenetics Group to build a robust
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molecular testing capability and establish close collaborations with industry leading partners and to launch its pipeline products in the future.
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Prenetics Group Has First-Mover Advantage with Established Presence and Brand Recognition and is Positioned Strongly to Replicate U.S. Peers’ Success Stories in Target Geographies. Prenetics Group is among the first movers in Asia and EMEA to introduce consumer genetic testing products and COVID-19 testing services, which enabled Prenetics Group to build an established presence, accumulate experience and achieve prominent brand recognition. On this basis, the Artisan Board believes Prenetics Group is positioned strongly to replicate its U.S. peers’ success stories by offering comparable products in its target geographies such as Asia and EMEA (which are markets with significant potential but not targeted or reached by most of its U.S. peers), as Prenetics Group can leverage its robust molecular testing capability, close collaborations with industry-leading institutional customers and strong brand recognition among business organizations and medical communities.
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Significant Synergies with Dr. Adrian Cheng’s Ecosystem. The Artisan Board believes the Business Combination represents a partnership with Dr. Cheng Chi Kong (Adrian), the founder of Artisan (“Dr. Adrian Cheng”) and his broader ecosystem, which will connect Prenetics Group to a significantly broad network of healthcare, retail, hospitality, education, sports, workspace, residential and other sectors. Prenetics Group’s high-growth businesses fit well into the business strategy and development plans of the wider investment portfolio associated with Dr. Adrian Cheng, and the Business Combination can create opportunities to enhance revenue and operational synergies between Dr. Adrian Cheng’s business portfolio and Prenetics Group and further unleash Prenetics Group’s business growth potential in its existing product and service portfolio and pipeline products in the future, creating value for Artisan’s shareholders.
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Financial Performance and Projections. Based on its review of Prenetics Group’s historical financial information and financial projections, the Artisan Board considered that (i) Prenetics Group’s management has a track record of scaling the genetic testing business in a capital efficient manner, and has delivered significant aggregate revenue growth since Prenetics Group’s inception but also that (ii) a significant portion of Prenetics Group’s historical revenue was, and its near-term revenue will be, generated from its COVID-19 testing services, the demand for which may be substantially reduced with the production and widely administered use of an efficacious vaccine or treatment for COVID-19; and (iii) Prenetics’ management anticipates that Prenetics Group will continue to incur net losses for the next several financial years through 2025.
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Strong and Committed Existing Management Team. The Artisan Board considered that Prenetics’ management team has extensive experience in business management, healthcare and life science and e-commerce: (i) Mr. Danny Yeung, the co-founder and chief executive officer of Prenetics who will be serving as the chairman and chief executive officer of the combined entity after closing of the Business Combination, is a serial entrepreneur with a strong track record and domain expertise in e-commerce; and (ii) Prenetics Group has been led by a strong team of senior management with diversified and complementary skillsets and expertise to support Prenetics Group’s transformational growth, and such management team will continue to manage the combined entity and drive its business growth after closing of the Business Combination.
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Continued Support by Existing Shareholders. The Artisan Board noted that (i) existing Prenetics’ shareholders would not be receiving any cash consideration in connection with the Business Combination; (ii) existing Prenetics’ shareholders will continue to own over 67% of the combined company on a fully-diluted basis immediately after the Acquisition Closing (assuming no redemptions by Artisan Public Shareholders and there are no Dissenting Artisan Shareholders); and (iii) major shareholders of Prenetics had agreed to have their ownership subjected to post-closing lock-up arrangements, such that, subject to limited exceptions, (1) 50% of the PubCo Ordinary Shares to be acquired by Danny Yeung in the Business Combination will be subject to a lock-up for 6 months after consummation of the Business Combination and the remaining 50% will be subject to a lock-up for 12 months after consummation of the Business Combination; and (2) as of the date of this proxy statement/prospectus, shareholders (other than Danny Yeung) representing over 81.9% of Prenetics’ issued and outstanding shares have agreed to a 180-day lock-up of the PubCo Ordinary Shares to be acquired by them after consummation of the Business Combination. The Artisan Board considered
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these to be strong signs of Prenetics’ existing shareholders confidence in the combined company and the benefits to be realized as a result of the Business Combination.
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Platform for Future Development and Expansion. The cash proceeds available to PubCo upon closing of the Business Combination and Prenetics’ access to the public capital markets through the Business Combination are expected to provide Prenetics with an optimal platform and strong financial foundation for its further development and business expansion.
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Committed Equity Investment. An aggregate of $120 million of private capital has been committed by Forward Purchase Investors and PIPE Investors, which indicates confidence and support for the Business Combination from third party investors.
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Reasonable Valuation. The Artisan Board considered that the valuation of Prenetics under the terms of the Business Combination Agreement, reflected a reasonable valuation for the Prenetics Group’s business on an appropriately risk-adjusted basis.
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Certainty of Closing of the Business Combination. On the basis that (i) the closing of the Business Combination is not subject to regulatory review, report or pre-approval under the applicable anti-trust or competition laws in effect as of the date hereof in the jurisdictions in which Prenetics Group has business operations, thereby reducing the uncertainty and regulatory risk in connection with completing the Business Combination; and (ii) as of the date of the Business Combination Agreement the shareholders of Prenetics representing at least 65% of the outstanding Prenetics Shares (on an as converted basis) have entered into the Prenetics Shareholder Support Agreements agreeing to vote in favor of the transactions contemplated by the Business Combination Agreement, the Artisan Board expected that the Business Combination can be consummated pursuant to the terms and conditions of the Business Combination Agreement.
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Independent Directors’ Role. The Artisan Board is comprised of a majority of independent directors who are not affiliated with the Sponsor or its affiliates. Artisan’s independent directors evaluated and unanimously approved, as members of the Artisan Board, the Business Combination Agreement and the ancillary documents and the transactions contemplated thereby. While a wholly-owned subsidiary of New World Development, an affiliate of the Sponsor, has acquired an equity interest in Prenetics through a convertible note issued by Prenetics HK for $3,000,000 in February 2021 (representing approximately 0.82% of the fully-diluted equity in Prenetics as of the date of this proxy statement/prospectus), and New World Development has commercial arrangements with Prenetics regarding product promotion and distribution and storefront and office space rental, the Artisan Board, after careful consideration and deliberation, decided not to form an independent committee to evaluate the Business Combination, because, among other reasons, (i) the Artisan Board is comprised of a majority of independent directors; (ii) the Artisan Board, including the independent directors, determined that the existing equity investment in Prenetics by the Sponsor’s affiliate was immaterial; and (iii) to the knowledge of the Artisan Board, the relevant commercial arrangements between Prenetics Group and New World Development were negotiated on an arm’s length basis and were not contingent upon the success or failure of the Business Combination.
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Risks Relevant to the Transaction. In the course of its deliberations, the Artisan Board also considered a variety of risks and uncertainties relevant to the transaction, including, among other things, (i) risks associated with the Business Combination, including risks for Artisan’s unaffiliated investors arising from the process of taking a company public by means of a business combination with a special purpose acquisition company, as compared to taking a company public through a traditional initial public offering, such as the absence of due diligence conducted by one or more underwriters that would be subject to liability for any material misstatements or omissions in a registration statement, investors’ inability to recover damages from such underwriters in the event of misstatements and omission in the registration statement, the lack of an effective book-building process, and potentially lower demand, decreased liquidity and increased trading volatility of PubCo’s securities, (ii) risks relating to Prenetics Group’s business, (iii) risks associated with the liquidation of Artisan and (iv) risks associated with post-closing corporate governance.
For a more complete description of Artisan Board’s reasons for approving the Business Combination, including other factors and risks considered by the Artisan Board, see “The Business Combination Proposal — The Artisan Board’s Reasons for the Approval of the Business Combination.”
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The Initial Merger Proposal
The shareholders of Artisan will vote on a separate proposal to authorize the Initial Merger and the Plan of Initial Merger by way of a special resolution under the Cayman Islands Companies Act. Please see “The Initial Merger Proposal.”
The Adjournment Proposal
If, based on the tabulated vote, there are insufficient votes at the time of the Extraordinary General Meeting to authorize Artisan to consummate the Initial Merger or the Business Combination or if holders of Artisan Public Shares have elected to redeem an amount of Artisan Public Shares such that the minimum available cash condition contained in the Business Combination Agreement would not be satisfied, the chairman of the meeting may (and Artisan is required under the Business Combination Agreement to) submit a proposal to adjourn the Extraordinary General Meeting to a later date or dates, if necessary, to permit further solicitation of proxies. Please see “The Adjournment Proposal.”
Date, Time and Place of Extraordinary General Meeting of Artisan shareholders
The Extraordinary General Meeting of the shareholders of Artisan shall be held at AM, time, on , 2022 at and virtually over the Internet via live audio webcast at https://www.cstproxy.com/artisanacquisition/2022 to consider and vote upon the Business Combination Proposal, the Initial Merger Proposal and if necessary, the Adjournment Proposal.
Voting Power; Record Date
Shareholders shall be entitled to vote or direct votes to be cast at the Extraordinary General Meeting if they owned Artisan Shares at the close of business on , 2022, which is the record date for the Extraordinary General Meeting. Shareholders shall have one vote for each Artisan Share owned at the close of business on the record date. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker or bank to ensure that votes related to the shares you beneficially own are properly counted. Warrants do not have voting rights. On the record date, there were 33,934,235 Artisan Public Shares and 9,983,558 Founder Shares outstanding.
Quorum and Vote of Artisan shareholders
A quorum of Artisan shareholders is necessary to hold a valid meeting. A quorum shall be present at the Extraordinary General Meeting if one or more shareholders holding in the aggregate not less than one-third of the total issued Artisan Shares entitled to vote at the Extraordinary General Meeting are present in person or by proxy. As of the record date, 14,639,265 Artisan Shares would be required to achieve a quorum. An abstention or broker non-vote will be counted towards the quorum requirement but will not count as a vote cast at the Extraordinary General Meeting. The proposals presented at the Extraordinary General Meeting shall require the following votes:
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Business Combination Proposal — The approval of the Business Combination Proposal will require an ordinary resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of a majority of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.
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Initial Merger Proposal — The approval of the Initial Merger Proposal will require a special resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of at least two-thirds of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.
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Adjournment Proposal — The approval of the Adjournment Proposal, if presented, will require an ordinary resolution under Cayman Islands law and the Artisan Articles, being the affirmative vote of the holders of a majority of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.
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Redemption Rights
Pursuant to the Artisan Articles, in connection with the completion of the Business Combination, Artisan Public Shareholders may elect to have their Artisan Public Shares redeemed for cash at the applicable redemption price per share calculated in accordance with the Artisan Articles. For illustrative purposes, as of , 2022, this redemption amount would have amounted to approximately $ per share. In this proxy statement/prospectus, these rights to demand redemption of the Artisan Public Shares are sometimes referred to as “redemption rights.” Artisan Public Shareholders may elect to exercise such redemption rights, regardless of whether they vote or, if they do vote, irrespective of whether they vote for or against the Business Combination Proposal or the Initial Merger Proposal.
If you are an Artisan Public Shareholder and wish to exercise your right to have your Artisan Public Shares redeemed, you must:
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submit a written request to Continental, Artisan’s transfer agent, in which you (i) request that Artisan redeem all or a portion of your Artisan Public Shares for cash, and (ii) identify yourself as the beneficial holder of the Artisan Public Shares and provide your legal name, phone number and address; and
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either tender your share certificates (if any) to Continental, Artisan’s transfer agent, or deliver your Artisan Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC (Deposit/Withdrawal at Custodian) System.
Artisan Public Shareholders must complete the procedures for electing to redeem their Artisan Public Shares in the manner described above prior to on , 2022 (two business days prior to the vote at the Extraordinary General Meeting) in order for their Artisan Ordinary Shares to be redeemed.
There is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC system. The transfer agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not to pass this cost on to the redeeming shareholder. In the event the Business Combination is not consummated this may result in an additional cost to shareholders for the return of their shares.
If you hold the Artisan Public Shares in “street name,” you will have to coordinate with your broker or bank to have the Artisan Public Shares you beneficially own certificated and delivered electronically.
Holders of Units must elect to separate the Units into the underlying Artisan Public Shares and Artisan Warrants prior to exercising redemption rights with respect to the Artisan Public Shares. If holders hold their Units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the Units into the underlying Artisan Public Shares and Artisan Warrants, or if a holder holds Units registered in its own name, the holder must contact Continental, Artisan’s transfer agent, directly and instruct it to do so. The redemption rights include the requirement that a holder must identify itself in writing as a beneficial holder and provide its legal name, phone number and address to Continental in order to validly redeem its Artisan Public Shares.
If the Business Combination is not consummated, the Artisan Public Shares will not be redeemed and instead will be returned to the respective holder, broker or bank. In such case, Artisan shareholders may only share in the assets of the trust account upon the liquidation of Artisan. This may result in Artisan shareholders receiving less than they would have received if the Business Combination was completed and they had exercised redemption rights in connection therewith due to potential claims of creditors.
If an Artisan Public Shareholder satisfies the requirements for exercising redemption rights with respect to all or a portion of the Artisan Public Shares he, she or it holds and the Business Combination is consummated, Artisan will redeem such Artisan Public Shares for a per-share price, payable in cash, equal to the pro rata portion of the amount on deposit in the trust account calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the funds held in the trust account and not previously released to Artisan to pay income taxes (less up to $100,000 of interest to pay dissolution expenses). There are currently no owed but unpaid income taxes on the funds in the trust account. However, the proceeds deposited in the trust account could become subject to the claims of Artisan’s creditors, if any, which would have priority over the claims of Artisan shareholders. Therefore, the per
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share distribution from the trust account in such a situation may be less than originally expected due to such claims. It is expected that the funds to be distributed to Artisan Public Shareholders electing to redeem their Artisan Public Shares shall be distributed promptly after the consummation of the Business Combination.
Notwithstanding the foregoing, an Artisan Public Shareholder, together with any affiliate of such holder and any person with whom such holder is acting in concert or as a “group” (as defined under Section 13(d)(3) of the Exchange Act), may not seek to have more than 15% of the aggregate Artisan Public Shares redeemed without the prior consent of Artisan. Additionally, under the Artisan Articles, in no event will Artisan redeem Artisan Public Shares in an amount that would cause its net tangible assets to be less than $5,000,001, such that Artisan is not subject to the SEC’s “penny stock” rules.
Any request for redemption, once made by an Artisan Public Shareholder, may be withdrawn at any time up to two business days prior to the vote at Extraordinary General Meeting. After this time, a request for redemption may not be withdrawn once unless the Artisan Board determines (in its sole discretion) to permit the withdrawal of such redemption request (which it may do in whole or in part). Such a request must be made by contacting Continental, Artisan’s transfer agent, at the phone number or address set out elsewhere in this proxy statement/prospectus.
No request for redemption shall be honored unless the holder’s share certificates (if any) or shares have been delivered (either physically or electronically) to Continental, Artisan’s transfer agent, in the manner described above, at least two business days prior to the vote at the Extraordinary General Meeting.
If you exercise your redemption rights, then you shall be exchanging your Artisan Public Shares for cash and shall not be entitled to receive any PubCo Class A Ordinary Shares in respect of such redeemed shares upon consummation of the Business Combination.
If you are a holder of Artisan Public Shares and you exercise your redemption rights, such exercise shall not result in the loss of any Artisan Warrants that you may hold.
The closing price of Artisan Public Shares on the record date was $ . The cash held in the trust account on such date was approximately $ million (approximately $ per Artisan Public Share). Prior to exercising redemption rights, Artisan Public Shareholders should verify the market price of Artisan Public Shares as they may receive higher proceeds from the sale of their Artisan Public Shares in the public market than from exercising their redemption rights if the market price per share is higher than the redemption price. Artisan cannot assure its shareholders that they shall be able to sell their Artisan Public Shares in the open market, even if the market price per share is higher than the redemption price stated above, as there may not be sufficient liquidity in its securities when its shareholders wish to sell their shares.
Appraisal or Dissenters’ Rights
Holders of record of Artisan Shares may have appraisal rights in connection with the Business Combination under the Cayman Islands Companies Act. In this proxy statement/prospectus, these appraisal or dissent rights are sometimes referred to as “Dissent Rights”. Holders of record of Artisan Shares wishing to exercise such Dissent Rights and make a demand for payment of the fair value for his, her or its Artisan Shares must give written objection to the Initial Merger to Artisan prior to the shareholder vote at the Extraordinary General Meeting to approve the Initial Merger and follow the procedures set out in Section 238 of the Cayman Islands Companies Act, noting that any such dissenter rights may subsequently be lost and extinguished pursuant to Section 239 of the Cayman Islands Companies Act which states that no such dissenter rights shall be available in respect of shares of any class for which an open market exists on a recognized stock exchange or recognized interdealer quotation system at the expiry date of the period allowed for written notice of an election to dissent provided that the merger consideration constitutes inter alia shares of any company which at the effective date of the merger are listed on a national securities exchange. The Business Combination Agreement provides that, if any Artisan shareholder exercises Dissent Rights then, unless Artisan and Prenetics elect by agreement in writing otherwise, the Initial Merger shall not be consummated before the expiry date of the period allowed for written notice of an election to dissent in order to invoke the exemption under Section 239 of the Cayman Islands Companies Act. Artisan believes that such fair value would equal the amount that Artisan shareholders would obtain if they exercised their
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redemption rights as described herein. An Artisan shareholder which elects to exercise Dissent Rights must do so in respect of all of the Artisan Shares that person holds and will lose their right to exercise their redemption rights as described herein. See the section of this proxy statement/prospectus titled “Extraordinary General Meeting of Artisan Shareholders — Appraisal Rights under the Cayman Islands Companies Act.”
Artisan shareholders are recommended to seek their own advice as soon as possible on the application and procedure to be followed in respect of the appraisal rights under the Cayman Islands Companies Act.
Proxy Solicitation
Proxies may be solicited by mail, telephone or in person. Artisan has engaged Morrow Sodali LLC to assist in the solicitation of proxies.
If a shareholder grants a proxy, it may still vote its Artisan Shares at the Extraordinary General Meeting by attending the Extraordinary General Meeting virtually by visiting https://www.cstproxy.com/artisanacquisition/2022, entering the control number on its proxy card and voting via the web portal during the Extraordinary General Meeting webcast. A shareholder may also change its vote by submitting a later-dated proxy as described in the section entitled “Extraordinary General Meeting of Artisan shareholders — Revoking Your Proxy.”
Interests of Artisan’s Directors and Officer in the Business Combination
When considering the Artisan Board’s recommendation to vote in favor of approving the Business Combination Proposal and the Initial Merger Proposal, Artisan shareholders should keep in mind that Sponsor and Artisan’s directors and officer have interests in such proposals that are different from, or in addition to (and which may conflict with), those of Artisan shareholders and warrantholders generally. These interests include, among other things, the interests listed below:
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the fact that the Sponsor and Artisan’s directors and officer have agreed not to redeem any Artisan Shares held by them in connection with a shareholder vote to approve the proposed Business Combination;
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the fact that the Sponsor and certain of Artisan’s directors are anticipated to hold 5.1% of the equity interests and 2.2% of the voting power in PubCo immediately after the Business Combination, assuming no redemptions by Artisan Public Shareholders and there are no Dissenting Artisan Shareholders (or 6.1% of the equity interest and 2.4% of the voting power in PubCo immediately after the Business Combination, assuming maximum redemptions by Artisan Public Shareholders);
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the fact that the Sponsor and Artisan’s directors paid an aggregate of $25,000 for the 9,233,558 Founder Shares currently owned by the Sponsor and Artisan’s directors and such securities will have a significantly higher value after the Business Combination. As of , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus, the aggregate market value of these shares, if unrestricted and freely tradable, would be $ , based upon a closing price of $ per Artisan Public Share on NASDAQ. The Founder Shares are expected to be worthless if the Business Combination or another business combination is not completed by the Final Redemption Date because the holders are not entitled to participate in any redemption or distribution of proceeds in the trust account with respect to such shares;
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the fact that Sponsor paid $8,786,847 to purchase an aggregate of 5,857,898 Artisan Private Warrants, each exercisable to purchase one Artisan Public Share at $11.50, subject to adjustment, at a price of $1.50 per warrant, and those warrants would be worthless — and the entire $8,786,847 warrant investment would be lost — if the Business Combination or another business combination is not consummated by the Final Redemption Date. As of , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus, the aggregate market value of these Artisan Private Warrants, if unrestricted and freely tradable, would be $ , based upon a closing price of $ per Artisan Public Warrant on NASDAQ;
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the fact that, given the differential in the purchase price that the Sponsor and certain of Artisan’s directors paid for the Founder Shares and the purchase price that the Sponsor paid for the Artisan
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Private Warrants as compared to the price of the Artisan Public Shares and Artisan Public Warrants and the substantial number of PubCo Class A Ordinary Shares that the Sponsor and these directors will receive upon conversion of the Founder Shares and Artisan Private Warrants, the Sponsor and these directors can earn a positive return on their investment, even if other Artisan shareholders have a negative return on their investment in PubCo;
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the fact that Sponsor and Artisan’s directors and officer have agreed to waive their rights to liquidating distributions from the trust account with respect to any Founder Shares held by them if Artisan fails to complete a business combination by the Final Redemption Date;
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the fact that pursuant to a registration rights agreement dated May 13, 2021, the Sponsor and Artisan’s directors can demand that PubCo register its registrable securities under certain circumstances and assist in underwritten takedowns of such securities and will also have piggyback registration rights for these securities in connection with certain registrations of securities that PubCo undertakes;
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the fact that the Business Combination Agreement provides for the continued indemnification of Artisan’s directors and officer and the continuation of Artisan’s directors’ and officer’s liability insurance after the Business Combination (i.e., a “tail policy”);
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the fact that Sponsor and Artisan’s directors and officer and their affiliates are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on Artisan’s behalf, such as identifying and investigating possible business targets and business combinations. However, if Artisan fails to consummate a business combination within the required period, they will not have any claim against the trust account for reimbursement. Accordingly, Artisan may not be able to reimburse these expenses if the Business Combination or another business combination is not completed by the Final Redemption Date. As of the record date, the Sponsor and Artisan’s directors and officer and their affiliates had incurred approximately $ of unpaid reimbursable expenses;
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the fact that if the trust account is liquidated, including in the event Artisan is unable to complete a business combination by the Final Redemption Date, the Sponsor has agreed to indemnify Artisan to ensure that the proceeds in the trust account are not reduced below $10.00 per Artisan Public Share, or such lesser per Artisan Public Share amount as is in the trust account on the liquidation date, by the claims of prospective target businesses with which Artisan has discussed entering into a transaction agreement or claims of any third party for services rendered or products sold to Artisan, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the trust account;
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the fact that an affiliate of the Sponsor entered into a convertible note subscription agreement with Prenetics HK in February 2021, pursuant to which it acquired 454,387 series D preferred shares of Prenetics HK for a consideration of $3,000,000, representing 0.82% of the equity interests in Prenetics on a fully diluted basis as of the date of this proxy statement/prospectus;
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the fact that New World Development (an affiliate of the Sponsor) has commercial arrangements with Prenetics Group regarding product promotion and distribution and storefront and office space rental; and
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the fact that Mr. Yin Pan Cheng, a current director of Artisan, is expected to become a director of PubCo and in such case would be compensated as a director of PubCo.
The Sponsor has agreed to, among other things, vote all of their Artisan Shares in favor of the proposals being presented at the Extraordinary General Meeting in connection with the Business Combination and waive their redemption rights with respect to their Artisan Shares in connection with the consummation of the Business Combination. As of the date of this proxy statement/prospectus, on an as-converted basis, the Sponsor and certain Artisan directors own, collectively, approximately 21% of the issued and outstanding Artisan Shares.
At any time at or prior to the Business Combination, during a period when they are not then aware of any material nonpublic information regarding Artisan or its securities, the Sponsor, Prenetics, and/or Artisan’s or Prenetics’ directors, officers, or respective affiliates may purchase Artisan Public Shares from institutional and other investors who vote, or indicate an intention to vote, against the Business Combination
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Proposal or Initial Merger Proposal, or execute agreements to purchase such shares from such investors in the future, or they may enter into transactions with such investors and others to provide them with incentives to acquire Artisan Public Shares or vote their Artisan Public Shares in favor of the Business Combination Proposal or Initial Merger Proposal. Such a purchase may include a contractual acknowledgement that such shareholder, although still the record holder of Artisan Shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights.
If the Sponsor, Prenetics, and/or Artisan’s or Prenetics’ directors, officers, or respective affiliates purchase Artisan Public Shares in privately negotiated transactions from Artisan Public Shareholders who have already elected to exercise their redemption rights, then such selling shareholder would be required to revoke their prior elections to redeem their Artisan Public Shares. The Sponsor, Prenetics, and/or Artisan’s or Prenetics’ directors, officers, or respective affiliates may also purchase Artisan Public Shares from institutional and other investors who indicate an intention to redeem Artisan Public Shares, or, if the price per share of Artisan Public Shares falls below $10.00 per share, then such parties may seek to enforce their redemption rights. The above-described activity could be especially prevalent in and around the time of Closing. The purpose of such share purchases and other transactions would be to increase the likelihood that the following requirements are satisfied: (i) the Business Combination Proposal is approved by the affirmative vote of the holders of a majority of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting; (ii) the Initial Merger Proposal is approved by the affirmative vote of the holders of at least two-thirds of the issued and outstanding Artisan Shares entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting; (iii) otherwise limit the number of Artisan Public Shares electing to redeem; and (iv) PubCo’s net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) being at least $5,000,001 after giving effect to the transactions contemplated by the Business Combination Agreement and the PIPE financing. The Sponsor, Prenetics and/or Artisan’s or Prenetics’ directors, officers, or respective affiliates may also purchase Artisan Public Shares from institutional and other investors for investment purposes.
Entering into any such arrangements may have a depressive effect on the Artisan Shares. For example, as a result of these arrangements, an investor or holder may have the ability to effectively purchase shares at a lower-than-market price and may therefore be more likely to sell the shares he, she, or they own, either at or before the Business Combination.
If such transactions are executed, then the Business Combination could be completed in circumstances where such consummation would not have otherwise occurred. Share purchases by the persons described above would allow them to exert more influence over approving the proposals to be presented at the Extraordinary General Meeting and would likely increase the chances that such proposals would be approved. Artisan will file or submit a Current Report on Form 8-K to disclose any material arrangements entered into or significant purchases made by any of the aforementioned persons that would affect the vote on the proposals to be put to the Extraordinary General Meeting or the redemption threshold. Any such report will include descriptions of any arrangements entered into or significant purchases by any of the aforementioned persons.
The existence of financial and personal interests of one or more of Artisan’s directors and officer results in conflicts of interest on the part of such director(s) between what he, she, or they may believe is in the best interests of Artisan and what he, she, or they may believe is best for himself, herself, or themselves in determining to recommend that shareholders vote for the proposals.
Please see “The Business Combination Proposal — Interests of Artisan’s Directors and Officer in the Business Combination” for additional information on interests of Artisan’s directors and officer.
Recommendation to Shareholders
The Artisan Board believes that each of the proposals to be presented at the Extraordinary General Meeting is fair to, and in the best interests of, Artisan and unanimously recommends that its shareholders vote “FOR” the Business Combination Proposal, “FOR” the Initial Merger Proposal and “FOR” the Adjournment Proposal, if presented.
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Risk Factor Summary
In evaluating the proposals to be presented at the Extraordinary General Meeting of the shareholders of Artisan, a shareholder should carefully read this proxy statement/prospectus and especially consider the factors discussed in the section titled “Risk Factors,” a summary of which is set forth below. The occurrence of one or more of the events or circumstances described below, alone or in combination with other events or circumstances, may adversely affect Artisan’s ability to effect the Business Combination, and may have an adverse effect on the business, cash flows, financial condition and results of operations of Artisan prior to the Business Combination and that of PubCo subsequent to the Business Combination.
Prenetics Group faces various legal and operational risks associated with doing business in Hong Kong, which could result in a material change in the operations of Prenetics Group in Hong Kong following the Business Combination, cause the value of PubCo’s securities to significantly decline or become worthless, and significantly limit or completely hinder its ability to accept foreign investments and offer or continue to offer securities to foreign investors. These risks include, but are not limited to:
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Prenetics is a Cayman Islands holding company with operations primarily conducted through Prenetics Operating Subsidiaries. PubCo is also a Cayman Islands holding company and not an operating company. Accordingly, following the consummation of the Business Combination, Artisan shareholders who do not elect to have their Artisan Public Shares redeemed for cash, the Prenetics shareholders, the Forward Purchase Investors and the PIPE Investors will be holding equity interest in a Cayman Islands holding company and not equity of Prenetics Operating Subsidiaries.
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Historically, Prenetics held a minority interest in a genomics business in mainland China through Shenzhen Discover Health Technology Co., Ltd. (the “VIE Entity”), a PRC limited liability company, by entering into a series of contractual arrangements with the VIE Entity and its nominee shareholders through Prenetics’ wholly owned PRC subsidiary, Qianhai Prenetics Technology (Shenzhen) Co., Ltd. (the “WFOE”). On November 26, 2021, the agreements governing the VIE Entity were terminated with immediate effect. As a result, the corporate structure of Prenetics no longer contains any VIE. While the current corporate structure does not contain any VIE and Prenetics Group has no intention establishing any VIEs in PRC in the future, if in the future Prenetics Group’s structure were to contain a VIE, the PRC regulatory authorities could disallow the VIE structure, which would likely result in a material adverse change in Prenetics Group’s operations, and the securities of PubCo may decline significantly in value or become worthless.
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The business, financial condition and results of operations of Prenetics, and/or the value of PubCo’s securities or PubCo’s ability to offer or continue to offer securities to investors may be materially and adversely affected to the extent the laws and regulations of the PRC become applicable to Prenetics. In that case, Prenetics may be subject to the risks and uncertainties associated with the evolving laws and regulations in the PRC, their interpretation and implementation, and the legal and regulatory system in the PRC more generally, including with respect to the enforcement of laws and the possibility of changes of rules and regulations with little or no advance notice. Although Prenetics currently does not have any business operations in mainland China, and Prenetics’ corporate structure does not contains any variable interest entity, given Prenetics’ substantial operations in Hong Kong and the Chinese government’s significant oversight authority over the conduct of business in Hong Kong, and Prenetics faces risks and uncertainties associated with the complex and evolving PRC laws and regulations and as to whether and how the recent PRC government statements and regulatory developments, such as those relating to variable interest entities, data and cyberspace security, and anti-monopoly concerns, would be applicable to a company such as Prenetics. The Chinese government may, in the future, seek to affect operations of any company with any level of operations in mainland China or Hong Kong, including its ability to offer securities to investors, list its securities on a U.S. or other foreign exchange, conduct its business or accept foreign investment. Should the Chinese government seek to affect operations of any company with any level of operations in Hong Kong, or should certain PRC laws and regulations or these statements or regulatory actions become applicable to Prenetics or Prenetics HK in the future, it would likely have a material adverse impact on Prenetics Group’s business, financial condition and results of operations, ability to accept foreign investments and PubCo’s ability to offer or continue to offer securities to investors on a U.S. or other international securities exchange, any of which may cause the value of PubCo’s
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securities to significantly decline or become worthless. For example, if the recent PRC regulatory actions on data security or other data-related laws and regulations were to apply to Prenetics or Prenetics HK, it could become subject to certain cybersecurity and data privacy obligations, including the potential requirement to conduct a cybersecurity review for its listing at a foreign stock exchange, and the failure to meet such obligations could result in penalties and other regulatory actions against it and may materially and adversely affect its business and results of operations.
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PubCo’s securities may be delisted or prohibited from being traded “over-the-counter” under the HFCA Act if PubCo has filed an annual report containing an audit report issued by a registered public accounting firm that the PCAOB has determined it is unable to inspect or investigate completely because of a position taken by an authority in the foreign jurisdiction and is identified by the SEC as a “Commission-Identified Issuer” for three consecutive years. On December 16, 2021, the PCAOB issued a report on its determinations that it is unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China and in Hong Kong, because of positions taken by one or more authorities in such jurisdictions. Since Prenetics’ auditor is located in Hong Kong, it is included on a list of audit firms the PCAOB determined it is unable to inspect or investigate completely because of a position taken by one or more authorities in Hong Kong, and is therefore subject to the PCAOB’s determination. The delisting or the cessation of trading “over-the-counter” of PubCo’s securities, or the threat of their being delisted or prohibited, may materially and adversely affect the value and/or liquidity of your investment. The Accelerating Holding Foreign Companies Accountable Act, passed by the U.S. Senate and if enacted, would require foreign companies to comply with the PCAOB audits within two consecutive years instead of three consecutive years and therefore reduce the time period for triggering the listing and trading prohibitions from three years to two years. Additionally, since the PCAOB is currently unable to conduct full inspections or investigations of Prenetics’ auditor, PubCo’s investors would be deprived of the benefits of such inspections or investigations.
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The PRC government has significant oversight, discretion or control over the manner in which companies incorporated under the laws of PRC must conduct their business activities, but as Prenetics Group operates in Hong Kong and not mainland China, the PRC government currently does not exert direct oversight and discretion over the manner in which Prenetics Group conducts its business activities. However, there is no guarantee that the PRC government will not seek to intervene or influence Prenetics Group’s operations at any time. If Prenetics Group were to become subject to such oversight, discretion or control, including over overseas offerings of securities and/or foreign investments, it may result in a material adverse change in Prenetics Group’s operations, significantly limit or completely hinder PubCo’sability to offer or continue to offer securities to investors and cause the value of PubCo’s securities to significantly decline or be worthless, which would materially affect the interests of the investors. There also can be no assurance that the PRC government will not intervene or impose restrictions on Prenetics Group’s ability to transfer or distribute cash within its organization, which could result in an inability or prohibition on making transfers or distributions to entities outside of Hong Kong and adversely affect its business. See “Selected Historical Financial Data of Prenetics” for the condensed consolidating schedules for Prenetics, Prenetics HK, WFOE, the VIE Entity and other subsidiaries of Prenetics Group, respectively, starting on page 47 of this proxy statement/prospectus.
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Implementation of the National Security Law in Hong Kong involves uncertainty, and the recent policy pronouncements by the PRC government regarding business activities of U.S.-listed Chinese businesses may negatively impact Prenetics Group’s existing and future operations in Hong Kong.
For additional detail on these and other risks, see “Risk Factors — Risks Relating to Doing Business in Hong Kong” starting on page 53 of this proxy statement/prospectus.
In addition, there are various risks related to Prenetics Group’s business and operations, which include, but are not limited to:
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A significant portion of Prenetics Group’s historical revenue was, and its near-term revenue will be generated, from its COVID-19 testing services, the demand for which may be substantially reduced with the production and widely administered use of an efficacious vaccine or treatment for COVID-19,
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and failure of Prenetics Group to drive significant revenues from other products and services and expand its overall customer base would harm its business and results of operation.
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The diagnostic testing market, particularly with respect to COVID-19 testing services, is highly competitive, and many of Prenetics Group’s competitors are larger, better established and have greater financial and other resources.
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The consumer genetic testing market is highly competitive, and many of Prenetics Group’s competitors are more established and have stronger marketing capabilities and greater financial resources, which presents a continuous threat to the success of its consumer genetic testing business.
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Prenetics Group’s near-term success is highly dependent on the successful launch of Circle HealthPod and the continued commercialization of its COVID-19 testing services and other products in its target geographies. If Prenetics Group’s existing or new service or product offerings are unable to attain market acceptance or be successfully commercialized in all or any of these jurisdictions, its business and future prospects could be materially and adversely affected.
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Prenetics Group relies substantially on third-party contract manufacturers for the manufacturing, quality-testing, assembly and shipping of its COVID-19 test kit and other testing products. Any termination of significant rights under the existing arrangements would disrupt Prenetics Group’s ability to sell and distribute its COVID-19 test kit and other products until and unless it finds new contract manufacturers, which would materially and adversely affect its business.
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Prenetics Group has a number of pipeline products that are currently in the R&D phase, including Circle Medical, Circle SnapShot, future assays of Circle HealthPod, Circle One and F1x and Fem, and may not be successful in its efforts to develop any of these or other products into marketable products. Any failure to develop these or other products or any delay in the development could adversely affect its business and future prospects.
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If Prenetics Group is not successful in leveraging its platform to discover, develop and commercialize additional products, its ability to expand its business and achieve its strategic objectives would be impaired.
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If Prenetics Group’s products and services do not deliver reliable results as expected, its reputation, business and operating results will be adversely affected.
For additional detail on these and other risks, see “Risk Factors — Key Risks Relating to Prenetics Group’s Business” starting on page 58 of this proxy statement/prospectus.
Furthermore, the process of taking a company public by means of a business combination with a special purpose acquisition company is different from taking a company public through a traditional initial public offering and may create risks for Artisan’s unaffiliated investors, such as the absence of due diligence conducted by one or more underwriters that would be subject to liability for any material misstatements or omissions in a registration statement, investors’ inability to recover damages from such underwriters in the event of misstatements and omission in the registration statement, the lack of an effective book-building process, and potentially lower demand, decreased liquidity and increased trading volatility of PubCo’s securities. For details and other risks, see “Risk Factors — Risks Relating to Artisan and the Business Combination.”
Certain Information Relating to PubCo and Artisan
PubCo Listing
PubCo has applied for listing, to be effective at the time of the Initial Closing, of the PubCo Class A Ordinary Shares and the PubCo Warrants on NASDAQ and will obtain clearance by DTC as promptly as practicable following the issuance thereof, subject to official notice of issuance, prior to the Initial Closing Date.
Delisting and Deregistration of Artisan
If the Business Combination is completed, Artisan Public Shares, Artisan Public Warrants and Units shall be delisted from NASDAQ and shall be deregistered under the Exchange Act.
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Emerging Growth Company
Upon consummation of the Business Combination, PubCo will be an “emerging growth company” as defined in the JOBS Act. PubCo will remain an “emerging growth company” until the earliest to occur of (i) the last day of the fiscal year (a) following the fifth anniversary of the closing of the Business Combination, (b) in which PubCo has total annual gross revenue of at least $1.07 billion or (c) in which PubCo is deemed to be a large accelerated filer, which means the market value of the shares of PubCo held by non-affiliates exceeds $700 million as of the last business day of PubCo’s prior second fiscal quarter, PubCo has been subject to Exchange Act reporting requirements for at least 12 calendar months; and filed at least one annual report, and (ii) the date on which PubCo issued more than $1.0 billion in non-convertible debt during the prior three-year period. PubCo intends to take advantage of exemptions from various reporting requirements that are applicable to most other public companies, whether or not they are classified as “emerging growth companies,” including, but not limited to, an exemption from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that PubCo’s independent registered public accounting firm provide an attestation report on the effectiveness of its internal control over financial reporting and reduced disclosure obligations regarding executive compensation.
In addition, Section 102(b)(1) of the JOBS Act exempts “emerging growth companies” from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. PubCo has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, PubCo, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of PubCo’s financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used.
Furthermore, even after PubCo no longer qualifies as an “emerging growth company,” as long as PubCo continues to qualify as a foreign private issuer under the Exchange Act, PubCo will be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including, but not limited to, the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events. In addition, PubCo will not be required to file annual reports and financial statements with the SEC as promptly as U.S. domestic companies whose securities are registered under the Exchange Act, and are not required to comply with Regulation FD, which restricts the selective disclosure of material information.
Foreign Private Issuer
As a “foreign private issuer,” PubCo will be subject to different U.S. securities laws than domestic U.S. issuers. The rules governing the information that PubCo must disclose differ from those governing U.S. companies pursuant to the Exchange Act. PubCo will be exempt from the rules under the Exchange Act prescribing the furnishing and content of proxy statements to shareholders. Those proxy statements are not expected to conform to Schedule 14A of the proxy rules promulgated under the Exchange Act. As a “foreign private issuer,” PubCo is permitted to follow certain home country corporate governance practices in lieu of the requirements of the NASDAQ Rules pursuant to NASDAQ Rule 5615(a)(3), which provides for such exemption to compliance with the NASDAQ Rule 5600 Series. PubCo intends to rely on the exemption available to foreign private issuers for the requirement that an audit committee be comprised of at least three members under NASDAQ Rule 5605(c)(2)(A).
In addition, as a “foreign private issuer,” PubCo’s officers and directors and holders of more than 10% of the issued and outstanding PubCo Ordinary Shares, will be exempt from the rules under the Exchange
46
Act requiring insiders to report purchases and sales of ordinary shares as well as from Section 16 short swing profit reporting and liability. See “Risk Factors — Risks Relating to PubCo — PubCo will qualify as a foreign private issuer within the meaning of the rules under the Exchange Act, and as such PubCo is exempt from certain provisions applicable to United States domestic public companies” and “Management of PubCo Following the Business Combination — Foreign Private Issuer Status.”
Controlled Company
Upon the consummation of the business combination, PubCo will be a “controlled company” within the meaning of the NASDAQ corporate governance rules because it is expected that Mr. Yeung will beneficially own more than 50% of the total voting power of all issued and outstanding PubCo Ordinary Shares immediately following the consummation of the Business Combination. As a result, Mr. Yeung will have the ability to exercise significant influence over the election of the directors of PubCo and the authorization of major corporate transactions. In addition, as a result of PubCo’s dual-class share structure, holders of PubCo Class B Ordinary Shares will have considerable influence over matters such as decisions regarding election of directors and other significant corporate actions. This concentrated control will limit the ability of holders of PubCo Class A Ordinary Shares to influence corporate matters and could discourage others from pursuing any potential merger, takeover, or other change of control transactions that holders of PubCo Class A Ordinary Shares may view as beneficial, which could have the effect of depriving PubCo’s other shareholders of the opportunity to receive a premium for their shares as part of a sale of PubCo and may reduce the share price of PubCo.
Under the NASDAQ corporate governance rules, PubCo may elect not to comply with certain corporate governance rules, including the requirements (1) that a majority of the PubCo’s board of directors must consist of independent directors, (2) PubCo’s director nominees must be selected or recommended to the board of directors solely by independent directors or by a nominations committee that is comprised entirely of independent directors and (3) that the PubCo Board must have a compensation committee that is comprised entirely of independent directors. PubCo intends to rely on all of the foregoing exemptions available to a “controlled company”. As a result, you will not have the same protection afforded to shareholders of companies that are subject to this corporate governance requirement.
Material Tax Consequences
Subject to the limitations and qualifications described in “Material Tax Considerations — U.S. Federal Income Tax Considerations — U.S. Federal Income Tax Consequences of the Business Combination to U.S. Holders,” the Initial Merger should qualify as a “reorganization” within the meaning of Section 368(a)(1)(F) of the Code, and, as a result, a U.S. Holder (as defined in “Material Tax Considerations — U.S. Federal Income Tax Considerations to U.S. Holders — U.S. Federal Income Tax Considerations of the Business Combination to U.S. Holders”) should not recognize gain or loss on the exchange of Artisan Public Shares (excluding any redeemed Artisan Public Shares), and Artisan Warrants (collectively, the “Artisan Securities”) for PubCo Securities pursuant to the Initial Merger.
In the event that a U.S. Holder elects to redeem its Artisan Public Shares for cash, the treatment of the transaction for U.S. federal income tax purposes will depend on whether the redemption qualifies as a sale or exchange of the Artisan Public Shares under Section 302 of the Internal Revenue Code (the “Code”). If the redemption qualifies as a sale or exchange of the Artisan Public Shares, subject to the PFIC considerations discussed in “Material Tax Considerations — U.S. Federal Income Tax Considerations — U.S. Federal Income Tax Consequences of the Business Combination to U.S. Holders — PFIC Considerations), a U.S. Holder generally will be treated as recognizing capital gain or loss equal to the difference between the amount realized on the redemption and such U.S. Holder’s adjusted tax basis in the Artisan Public Shares surrendered in such redemption transaction. There may be certain circumstances, however, in which the redemption may be treated as a distribution for U.S. federal income tax purposes depending on the amount of Artisan Public Shares that such U.S. Holder owns or is deemed to own (including through the ownership of Artisan warrants) after the redemption. See the section titled “Material Tax Considerations — U.S. Federal Income Tax Considerations — U.S. Federal Income Tax Consequences of the Business Combination to U.S. Holders — Redemption of Artisan Shares.”
47
Anticipated Accounting Treatment
Notwithstanding the legal form of the Business Combination pursuant to the Business Combination Agreement, the Business Combination will be accounted for following the principles of a reverse acquisition in accordance with IFRS as issued by the IASB. Under this method of accounting, Artisan will be treated as the “acquired” company and Prenetics will be treated as the acquirer for financial reporting purposes. Prenetics has been determined to be the accounting acquirer based on evaluation of the following facts and circumstances:
•
Prenetics’ shareholders will have the largest voting interest in PubCo under both the no redemption and maximum redemption scenarios;
•
Prenetics’ shareholders will have the ability to nominate at least a majority of the members of the board of directors of the post-combination company;
•
Prenetics’ senior management is the senior management of the post-combination company; and
•
Prenetics is the larger entity, in terms of substantive operations and employee base.
The Business Combination, which is not within the scope of IFRS 3 since Artisan does not meet the definition of a business in accordance with IFRS 3, is accounted for as a share-based payment transaction within the scope of IFRS 2. The net assets of Prenetics will be stated at their pre‑combination carrying amounts, with no goodwill or other intangible assets recorded. Any excess of the fair value of consideration transferred to Artisan’s shareholders over the fair value of Artisan’s identifiable net assets acquired represents compensation for the service of a stock exchange listing for its shares and is expensed as incurred.
Regulatory Matters
The Business Combination Agreement and the transactions contemplated by the Business Combination Agreement are not subject as a closing condition to any additional federal, state or foreign regulatory requirement or approval, except for filings with the Registrar of Companies of the Cayman Islands necessary to effectuate the Mergers contemplated by the Business Combination Agreement.
48
SELECTED HISTORICAL FINANCIAL DATA OF ARTISAN
The following tables present Artisan’s selected historical financial information derived from Artisan’s audited financial statements included elsewhere in this proxy statement/prospectus as of December 31, 2021 and for the period from February 2, 2021 (inception) through December 31, 2021.
The financial data set forth below should be read in conjunction with, and is qualified by reference to, “Artisan’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements and notes thereto included elsewhere in this proxy statement/prospectus. Artisan’s financial statements are prepared and presented in accordance with U.S. GAAP.
| | | |
As of December 31, 2021
|
| |||
| Balance Sheet Data: | | | | | | | |
|
Cash
|
| | | $ | 102,212 | | |
|
Investments held in trust account
|
| | | $ | 339,380,717 | | |
|
Total assets
|
| | | $ | 340,178,214 | | |
|
Warrant liabilities
|
| | | $ | 12,248,790 | | |
|
Derivative liability – forward purchase agreement
|
| | | $ | 484,643 | | |
|
Deferred underwriting fee payable
|
| | | $ | 11,876,982 | | |
|
Total liabilities
|
| | | $ | 27,888,846 | | |
|
Class A ordinary shares subject to possible redemption
|
| | | $ | 339,342,350 | | |
|
Total shareholders’ deficit
|
| | | $ | (27,052,982) | | |
| | | |
For the Period
From February 2, 2021 (Inception) Through December 31, 2021 |
| |||
| Statement of Operations Data: | | | | | | | |
|
Loss from operations
|
| | | $ | (3,943,227) | | |
|
Expensed offering costs
|
| | | | (534,056) | | |
|
Unrealized gain on investments held in trust account
|
| | | | 34,150 | | |
|
Change in fair value of derivative liability – forward purchase agreement
|
| | | | (874,285) | | |
|
Change in fair value of warrant liabilities
|
| | | | 2,005,780 | | |
|
Dividend income on investments held in Trust Account
|
| | | | 4,217 | | |
|
Net loss
|
| | | $ | (3,307,421) | | |
|
Basic and diluted weighted average shares outstanding, Class A ordinary shares
|
| | | | 23,119,071 | | |
|
Basic and diluted net loss per ordinary share, Class A ordinary shares
|
| | | $ | (0.10) | | |
|
Basic and diluted weighted average shares outstanding, Class B ordinary shares
|
| | | | 9,597,539 | | |
|
Basic and diluted net loss per ordinary share, Class B ordinary shares
|
| | | $ | (0.10) | | |
| | | |
For the Period
From February 2, 2021 (Inception) Through December 31, 2021 |
| |||
| Statement of Cash Flows Data: | | | | | | | |
|
Net cash used in operating activities
|
| | | $ | (1,372,731) | | |
|
Net cash used in investing activities
|
| | | $ | (339,342,350) | | |
|
Net cash provided by financing activities
|
| | | $ | 340,817,293 | | |
49
SELECTED HISTORICAL FINANCIAL DATA OF PRENETICS
The following tables present the selected consolidated financial and other data of Prenetics and its subsidiaries. The selected consolidated statements of profit or loss and other comprehensive income data for the years ended December 31, 2021, 2020 and 2019 and consolidated statements of financial position data as of December 31, 2021 and 2020 have been derived from the audited consolidated statements of financial position of Prenetics and its subsidiaries as of December 31, 2021 and 2020, and the related consolidated statements of profit or loss and other comprehensive income for each of the years in the three-year period ended December 31, 2021 included elsewhere in this proxy statement/prospectus.
The financial data set forth below should be read in conjunction with, and is qualified by reference to, “Prenetics Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and notes thereto included elsewhere in this proxy statement/prospectus. Prenetics’ consolidated financial statements are prepared and presented in accordance with IFRS. The historical results included below and elsewhere in this proxy statement/prospectus are not indicative of the future performance of Prenetics following the Business Combination.
| | | |
For the Years Ended
December 31, |
| |||||||||||||||
| | | |
2021
|
| |
2020
|
| |
2019
|
| |||||||||
|
Selected Statement of Profit or Loss and Other Comprehensive Income Data:
|
| | | | | | | | | | | | | | | | | | |
| Revenue | | | | $ | 275,852,753 | | | | | $ | 65,179,515 | | | | | $ | 9,233,089 | | |
|
Operating expenses
|
| | | | (286,070,281) | | | | | | (66,174,641) | | | | | | (30,036,374) | | |
|
Loss from operations
|
| | | | (10,217,528) | | | | | | (995,126) | | | | | | (20,803,285) | | |
|
Finance costs
|
| | | | (5,238,030) | | | | | | (59,567) | | | | | | (69,390) | | |
|
Fair value loss on convertible securities
|
| | | | (29,054,669) | | | | | | (2,846,750) | | | | | | — | | |
|
Fair value loss on preference shares liabilities
|
| | | | (125,398,798) | | | | | | — | | | | | | — | | |
|
Fair value loss on financial assets at fair value through profit or loss
|
| | | | (94,000) | | | | | | — | | | | | | — | | |
|
Write-off on amount due from a shareholder
|
| | | | (106,179) | | | | | | — | | | | | | — | | |
|
Gain on bargain purchase
|
| | | | 117,238 | | | | | | — | | | | | | — | | |
|
Loss on disposal of a subsidiary
|
| | | | (292,132) | | | | | | — | | | | | | — | | |
|
Loss before taxation
|
| | | | (170,284,098) | | | | | | (3,901,443) | | | | | | (20,872,675) | | |
|
Income tax (expense)/credit
|
| | | | (3,732,744) | | | | | | 1,937,558 | | | | | | 677,474 | | |
|
Loss for the year
|
| | | | (174,016,842) | | | | | | (1,963,885) | | | | | | (20,195,201) | | |
| Loss attributable to: | | | | | | | | | | | | | | | | | | | |
|
Equity shareholders of Prenetics
|
| | | | (174,009,273) | | | | | | (1,939,689) | | | | | | (20,141,991) | | |
|
Non-controlling interests
|
| | | | (7,569) | | | | | | (24,196) | | | | | | (53,210) | | |
|
Loss for the year
|
| | | | (174,016,842) | | | | | | (1,963,885) | | | | | | (20,195,201) | | |
|
Weighted average number of ordinary shares for the purpose of basic loss
per share |
| | | | 14,596,997 | | | | | | 13,176,752 | | | | | | 12,891,569 | | |
|
Weighted average number of ordinary shares for the purpose of diluted loss per share
|
| | | | 14,596,997 | | | | | | 13,176,752 | | | | | | 12,891,569 | | |
|
Basic loss per share
|
| | | $ | (11.92) | | | | | $ | (0.15) | | | | | $ | (1.56) | | |
|
Diluted loss per share
|
| | | $ | (11.92) | | | | | $ | (0.15) | | | | | $ | (1.56) | | |
50
| | | |
As of December 31,
|
| ||||||||||||
| | | |
2021
|
| |
2020
|
| | ||||||||
| Selected Statement of Financial Position Data: | | | | | | | | | | | | | | | | |
| Assets | | | | | | | | | | | | | | | | |
|
Non-current assets
|
| | | $ | 41,614,789 | | | | | | 34,926,561 | | | | ||
|
Current assets
|
| | | | 106,892,532 | | | | | | 43,956,750 | | | | ||
|
Total assets
|
| | | | 148,507,321 | | | | | | 78,883,311 | | | | ||
| Liabilities | | | | | | | | | | | | | | | | |
|
Preferred shares classified as non-current liabilities
|
| | | | 486,404,770 | | | | | | — | | | | ||
|
Other non-current liabilities
|
| | | | 4,259,730 | | | | | | 804,574 | | | | ||
|
Current liabilities
|
| | | | 58,737,734 | | | | | | 47,071,730 | | | | ||
|
Total liabilities
|
| | | | 549,402,234 | | | | | | 47,876,304 | | | | ||
| Equity | | | | | | | | | | | | | | | | |
|
Total (equity deficiency)/equity attributable to equity shareholders of Prenetics
|
| | | | (400,809,938) | | | | | | 31,084,413 | | | | ||
|
Non-controlling interests
|
| | | | (84,975) | | | | | | (77,406) | | | | ||
|
Total (equity deficiency)/equity
|
| | | | (400,894,913) | | | | | | 31,007,007 | | | | ||
|
Total equity and liabilities
|
| | | | 148,507,321 | | | | | | 78,883,311 | | | | ||
The following financial information has been prepared to illustrate the consolidated financial position as at December 31, 2020 and 2021 and cash flows and profit or loss and other comprehensive income for the years ended December 31, 2019, 2020 and 2021 for (i) Prenetics; (ii) Prenetics HK; (iii) WFOE; (iv) VIE; (v) other subsidiaries in Prenetics Group; and (vi) Prenetics Group. The financial information of Prenetics has been extracted from: Prenetics’ audited consolidated statements of financial position as of December 31, 2021 and 2020, and the related consolidated statements of profit or loss and other comprehensive income and cash flows for each of the years in the three-year period ended December 31, 2021 and the related notes, included elsewhere in this proxy statement/ prospectus.
51
| | | |
For the year ended December 31, 2021
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||
| | | |
Prenetics
$ |
| |
Prenetics HK
$ |
| |
WFOE
$ |
| |
VIE
$ |
| |
Other
Subsidiaries $ |
| |
Prenetics
adjustment $ |
| |
Inter-company
Elimination $ |
| |
Other
Adjustment (note(e)) $ |
| |
Prenetics Group
$ |
| |||||||||||||||||||||||||||
|
Revenue
|
| | | | — | | | | | | 125,462,376 | | | | | | — | | | | | | — | | | | | | 155,052,156 | | | | | | — | | | | | | (581,538) | | | | | | (4,080,241) | | | | | | 275,852,753 | | |
|
Direct costs
|
| | | | — | | | | | | (58,367,297) | | | | | | — | | | | | | — | | | | | | (114,528,559) | | | | | | — | | | | | | 616,778 | | | | | | 2,557,536 | | | | | | (169,721,542) | | |
|
Gross profit
|
| | | | — | | | | | | 67,095,079 | | | | | | — | | | | | | — | | | | | | 40,523,597 | | | | | | — | | | | | | 35,240 | | | | | | (1,522,705) | | | | | | 106,131,211 | | |
|
Other income and other net
(losses)/gains |
| | | | — | | | | | | (850,200) | | | | | | 5,498 | | | | | | 92 | | | | | | 442,139 | | | | | | — | | | | | | 40,501 | | | | | | 500,918 | | | | | | 138,948 | | |
|
Selling and distribution expenses
|
| | | | — | | | | | | (13,697,000) | | | | | | — | | | | | | — | | | | | | (8,235,322) | | | | | | — | | | | | | — | | | | | | — | | | | | | (21,932,322) | | |
|
Research and development expenses
|
| | | | — | | | | | | (8,593,950) | | | | | | — | | | | | | — | | | | | | (1,970,002) | | | | | | — | | | | | | — | | | | | | — | | | | | | (10,563,952) | | |
|
Administrative and other operating expenses
|
| | | | — | | | | | | (56,359,375) | | | | | | (17,478) | | | | | | (417) | | | | | | (25,655,932) | | | | | | — | | | | | | (4,556) | | | | | | (1,953,655) | | | | | | (83,991,413) | | |
|
(Loss)/profit from operations
|
| | | | — | | | | | | (12,405,446) | | | | | | (11,980) | | | | | | (325) | | | | | | 5,104,480 | | | | | | — | | | | | | 71,185 | | | | | | (2,975,442) | | | | | | (10,217,528) | | |
|
Finance costs
|
| | | | (5,009,847) | | | | | | (109,373) | | | | | | — | | | | | | — | | | | | | (178,103) | | | | | | — | | | | | | (440) | | | | | | 59,733 | | | | | | (5,238,030) | | |
|
Fair value loss on convertible securities
|
| | | | — | | | | | | (29,673,603) | | | | | | — | | | | | | — | | | | | | — | | | | | | 618,934 | | | | | | — | | | | | | — | | | | | | (29,054,669) | | |
|
Fair value loss on preference shares liabilities
|
| | | | (125,398,798) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (125,398,798) | | |
|
Fair value loss on financial derivatives
|
| | | | — | | | | | | (9,750,930) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 9,750,930 | | | | | | — | | | | | | — | | |
|
Fair value loss on financial assets at fair value through profit or loss
|
| | | | — | | | | | | (94,000) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (94,000) | | |
|
Write-off on amount due from a shareholder
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (106,179) | | | | | | — | | | | | | — | | | | | | — | | | | | | (106,179) | | |
|
Gain on bargain purchase
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 117,238 | | | | | | 117,238 | | |
|
Loss on disposal of a subsidiary
|
| | | | — | | | | | | (292,132) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (292,132) | | |
|
(Loss)/profit before taxation
|
| | | | (130,408,645) | | | | | | (52,325,484) | | | | | | (11,980) | | | | | | (325) | | | | | | 4,820,198 | | | | | | 618,934 | | | | | | 9,821,675 | | | | | | (2,798,471) | | | | | | (170,284,098) | | |
|
Income tax (expense)/credit
|
| | | | — | | | | | | (3,709,524) | | | | | | — | | | | | | — | | | | | | (28,319) | | | | | | — | | | | | | — | | | | | | 5,099 | | | | | | (3,732,744) | | |
|
(Loss)/profit for the year
|
| | | | (130,408,645) | | | | | | (56,035,008) | | | | | | (11,980) | | | | | | (325) | | | | | | 4,791,879 | | | | | | 618,934 | | | | | | 9,821,675 | | | | | | (2,793,372) | | | | | | (174,016,842) | | |
|
Other comprehensive income for the year
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
Item that may be reclassified subsequently
to profit or loss: |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Exchange differences on translation of: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
– financial statements of subsidiaries and a
joint venture outside Hong Kong |
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 260,112 | | | | | | 260,112 | | |
|
Total comprehensive income for the year
|
| | | | (130,408,645) | | | | | | (56,035,008) | | | | | | (11,980) | | | | | | (325) | | | | | | 4,791,879 | | | | | | 618,934 | | | | | | 9,821,675 | | | | | | (2,533,260) | | | | | | (173,756,730) | | |
52
| | | |
December 31, 2021
|
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | | |
Prenetics
$ |
| |
Prenetics HK
$ |
| |
WFOE
$ |
| |
VIE
$ |
| |
Other
Subsidiaries $ |
| |
Prenetics
adjustment $ |
| |
WFOE
adjustment |
| |
VIE
adjustment |
| |
Inter-company
Elimination $ |
| |
Other
Adjustment (note(e)) $ |
| |
Prenetics
Group $ |
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| Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
Property, plant and
equipment |
| | | | — | | | | | | 8,059,326 | | | | | | — | | | | | | — | | | | | | 4,973,519 | | | | | | — | ||||||||||||||||||||||||||||||||