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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
August 20, 2025
INFLECTION POINT ACQUISITION CORP. III
(Exact name of registrant as specified in its charter)
| Cayman Islands |
|
001-42614 |
|
N/A |
(State or other jurisdiction of
incorporation or organization) |
|
(Commission File Number) |
|
(IRS Employer
Identification No.) |
167 Madison Avenue Suite 205 #1017
New York, New York 10016
(Address of registrant’s principal executive
offices, including zip code)
(212) 476-6908
(Registrant’s telephone number, including
area code)
Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☒ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b)
of the Act:
| Title of each class |
|
Trading Symbols |
|
Name of each exchange on
which registered |
| Units, each consisting of one Class A ordinary share, $0.0001 par value, and one right to receive one-tenth (1/10) of one Class A ordinary share |
|
IPCXU |
|
The Nasdaq Stock Market LLC |
| Class A ordinary shares, par value $0.0001 par value |
|
IPCX |
|
The Nasdaq Stock Market LLC |
| Rights, each entitling the holder to receive one tenth (1/10) of one Class A ordinary share |
|
IPCXR |
|
The Nasdaq Stock Market LLC |
Indicate by check mark whether the
registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or
Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, 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 13(a) of the Exchange Act.
Item 1.01 Entry into a Material Definitive
Agreement.
Business Combination Agreement
On August 25, 2025 (the “Effective
Date”) Inflection Point Acquisition Corp. III, a Cayman Islands exempted company (“Inflection Point”), Air
Water Ventures Holdings Limited, a Cayman Islands exempted company (the “Company”), Air Water Ventures Limited, a Cayman
Islands exempted company (“PubCo”) and IPCX Merger Sub Limited, a Cayman Islands exempted company (“Merger
Sub”), entered into a Business Combination Agreement (the “Business Combination Agreement”). The transactions
contemplated by the Business Combination Agreement are referred to herein as the “Transactions.” Unless otherwise indicated,
capitalized terms used but not defined in this Current Report on Form 8-K (this “Report”) have the respective meanings
given to them in the Business Combination Agreement.
Pursuant to terms of the Business
Combination Agreement and subject to the terms and conditions set forth therein: (a) Inflection Point will be merged with and into PubCo,
as a result of which the separate corporate existence of Inflection Point shall cease and PubCo shall continue as the surviving company
(the “First Merger”), and (b) one Business Day after the First Merger, the Company will be merged with and into Merger
Sub, as a result of which the separate corporate existence of the Company shall cease and Merger Sub shall continue as the surviving company
and a wholly owned direct subsidiary of PubCo (the “Second Merger” and, together with the First Merger, the “Mergers”).
The Business Combination Agreement
and the transactions contemplated thereby were unanimously approved by the board of directors of each of Inflection Point, the Company,
PubCo and Merger Sub, and by the sole shareholder of each of PubCo and Merger Sub. The closing of the Transactions is targeted to be consummated
in the first quarter of 2026, after receipt of the required approval by the shareholders of Inflection Point (the “Inflection
Point Shareholder Approval”), the required approval of the shareholders of the Company (the “Company Shareholder Approval”)
and the fulfilment of certain other terms and conditions set forth in the Business Combination Agreement.
Conversion of Securities
One day prior to the date
of the First Merger Effective Time:
| ● | each SPAC Unit that is issued and outstanding at such time shall be
automatically detached into one (1) SPAC Class A Ordinary Share and one SPAC Right; |
| ● | each SPAC Class B Ordinary Share that is issued and outstanding at such time shall be automatically converted
into one (1) SPAC Class A Ordinary Share; and |
| ● | each SPAC Right that is issued and outstanding at such time shall be automatically converted into one-tenth
(1/10) of one SPAC Class A Ordinary Share (provided, that if a holder of SPAC Rights would be entitled to receive a fraction of a SPAC
Class A Ordinary Share upon the Rights Conversion, the number of SPAC Class A Ordinary Shares issued to such holder upon the Rights Conversion
will be rounded down to the nearest whole number of SPAC Class A Ordinary Shares without cash settlement for such rounded fraction). |
At the First Merger Effective
Time, by virtue of the First Merger and without any action on the part of any party or the holders of securities of Inflection Point or
PubCo:
| ● | each SPAC Class A Ordinary Share (other than any Excluded Shares, SPAC Dissenting Shares and Redeeming
SPAC Shares), which is issued and outstanding immediately prior to the First Merger Effective Time, shall be converted into the right
to receive one (1) PubCo Ordinary Share; and |
| ● | each PubCo Ordinary Share that is issued and outstanding immediately
prior to the First Merger Effective Time all of which shall be standing in the name of the PubCo Sole Shareholder in the register of members
of PubCo shall be irrevocably surrendered by the PubCo Sole Shareholder to PubCo for cancellation and for consideration equal to the subscription
price (if any) that the PubCo Sole Shareholder paid for such PubCo Ordinary Share. |
At the Second Merger Effective
Time, by virtue of the Second Merger and without any action on the part of any party or the holders of securities of the Company or PubCo:
| ● | each Company Ordinary Share that is issued and outstanding immediately
prior to the Second Merger Effective Time shall be converted into the right to receive a number of PubCo Ordinary Shares equal to (i)
that number of PubCo Ordinary Shares determined by dividing (x) $300,000,000 by (y) the Redemption Price; divided by (ii) the total
number of Company Ordinary Shares (including the Company Ordinary Shares underlying the Company RSUs) issued and outstanding immediately
prior to the Second Merger Effective Time (the “Exchange Ratio”); |
| ● | each Company Series A-1 Preferred Share that is issued and outstanding
immediately prior to the Second Merger Effective Time shall be converted into the right to receive a number of PubCo Preferred Shares
equal to (i) the aggregate Accrued Value attributable to such Company Series A-1 Preferred Share divided by (ii) the PubCo Preferred
Share Issue Price; |
| ● | each Company Series A-2 Preferred Share that is issued and outstanding
immediately prior to the Second Merger Effective Time shall be converted into the right to receive a number of PubCo Preferred Shares
equal to (i) the aggregate Accrued Value attributable to such Company Series A-2 Preferred Share divided by (ii) the PubCo Preferred
Share Issue Price; |
| ● | each Company Warrant that is issued and outstanding immediately prior
to the Second Merger Effective Time that was issued pursuant to a Pre-Funded PIPE Subscription Agreement or PIPE Agreement, will be converted
into the right to receive a PubCo Series A Investor Warrant exercisable for a number of PubCo Ordinary Shares equal to (x) the number
of Company Ordinary Shares issuable upon conversion of the applicable Pre-Funded PIPE Investor’s or PIPE Investor’s Company
Series A Preferred Shares upon a hypothetical conversion of such Company Series A Preferred Shares immediately prior to the Second Merger
multiplied by (y) the Exchange Ratio; |
| ● | each Company Warrant that is issued and outstanding immediately prior
to the Second Merger Effective Time which was not issued pursuant to a Pre-Funded PIPE Subscription Agreement or PIPE Agreement, will
be converted into the right to receive a PubCo Series A Investor Warrant exercisable for a number of PubCo Ordinary Shares equal to the
number of Company Ordinary Shares issuable upon a hypothetical conversion of such Company Warrant as of immediately prior to the Second
Merger; |
| ● | each Company RSU that is issued and outstanding immediately prior to
the Second Merger Effective Time shall be converted into the right to receive restricted stock units subject to PubCo Ordinary Shares
on the same terms and conditions (including applicable vesting, settlement and termination provisions) as are in effect with respect to
each such award of Company RSUs; provided, that each award of Exchanged RSUs will be subject to the number of PubCo Ordinary Shares
equal to the product of (x) the number of whole Company Ordinary Shares that were subject to such award of Company RSUs (with any fractional
share otherwise resulting rounded down to the nearest whole share) immediately prior to the Second Merger Effective Time, multiplied
by (y) the Exchange Ratio; |
| ● | each Company PSU that is issued and outstanding and unvested immediately
prior to the Second Merger Effective Time shall be assumed and converted into the right to receive performance-based restricted stock
units subject to PubCo Ordinary Shares on the same terms and conditions (including applicable performance vesting criteria and other applicable
settlement and termination provisions) as are in effect with respect to each such award of Company PSUs immediately prior to the Second
Merger Effective Time; provided, that each award of Exchanged PSUs will be subject to a number of PubCo Ordinary Shares, determined
based on the pro-rata portion of Company Earnout Shares attributable to such PSU Holder’s Company RSUs, subject to achievement of
the applicable Triggering Event (with any fractional share otherwise resulting rounded down to the nearest whole share); and |
| ● | each Merger Sub Share that is issued and outstanding immediately prior to the Second Merger Effective
Time shall be converted into and become one validly issued, fully paid and non-assessable ordinary share of the Second Surviving Company. |
Earnout
Following the Closing, PubCo
will issue to Eligible Company Equityholders and the PSU Holders up to 30,000,000 additional PubCo Ordinary Shares in the aggregate (the
“Earnout Shares”) in four tranches of 7,500,000, respectively, if:
| ● | (a) with respect to any full fiscal quarter of PubCo ending on or prior
to June 30, 2026, the Revenue for such fiscal quarter exceeds $25,000,000, or (b) PubCo or any of its consolidated subsidiaries enters
into a binding and definitive agreement on or prior to June 30, 2026 with the US Federal Emergency Management Agency (FEMA), the US Department
of Defense or other US federal agency or Regenerate1 LLC that provides for minimum annual and recurring Revenue of at least $100,000,000; |
| ● | with respect to any full fiscal quarter of PubCo ending on or prior to December 31, 2026, the Revenue
for such fiscal quarter exceeds $50,000,000; |
| ● | with respect to any full fiscal quarter of PubCo ending on or prior to December 31, 2026, the EBITDA for
such fiscal quarter exceeds $12,500,000; and |
| ● | within the time period beginning on the date that is the 6-month anniversary of the Closing Date and ending
on the date that is the 18-month anniversary of the Closing Date, the Ordinary Share Price is greater than or equal to $20.00, subject
to Equitable Adjustment. |
Representations and Warranties
Under the Business Combination
Agreement, Inflection Point has made customary representations and warranties to the Company and PubCo relating to, among other things,
organization and standing, due authorization and binding agreement, governmental approvals, non-contravention, capitalization, Securities
and Exchange Commission (the “SEC”) filings, financial statements, internal controls, absence of certain changes, compliance
with laws, litigation, actions, orders and permits, taxes and returns, employees and employee benefit plans, properties, material contracts,
transactions with related persons, the U.S. Investment Company Act of 1940, as amended (the “Investment Company Act”),
and the Jumpstart Our Business Startups Act of 2012, finders’ and brokers’ fees, sanctions and certain business practices,
private placements, insurance, no misleading information supplied, the Trust Account and receipt of a fairness opinion.
Under the Business Combination
Agreement, Merger Sub has made customary representations and warranties to PubCo and the Company relating to, among other things, organization
and standing, due authorization and binding agreement, governmental approvals, non-contravention, capitalization, limited activities,
finders’ and brokers’ fees, the Investment Company Act, no misleading information supplied and Merger Sub’s U.S. tax
classification.
Under the Business Combination
Agreement, PubCo has made customary representations and warranties to Inflection Point and the Company relating to, among other things,
organization and standing, due authorization and binding agreement, governmental approvals, non-contravention, capitalization, limited
activities, finders’ and brokers’ fees, the Investment Company Act, no misleading information supplied and the dormancy of
one of the Company’s Subsidiaries.
Under the Business Combination
Agreement, the Company has made customary representations and warranties (regarding itself and its subsidiaries) to Inflection Point relating
to, among other things, organization and standing, due authorization and binding agreement, capitalization, company subsidiaries, governmental
approvals, non-contravention, financial statements, absence of certain changes, compliance with laws, permits, litigation, material contracts,
intellectual property, taxes and returns, real property, personal property, employee matters, benefit plans, environmental matters, transactions
with related persons, insurance, material customers and suppliers, data protection and cybersecurity, sanctions and certain business practices,
the Investment Company Act, finders’ and brokers’ fees and no misleading information supplied.
Covenants
The Business Combination Agreement
includes customary covenants of the parties including, among other things, (i) the conduct of their respective business operations prior
to the consummation of the Transactions, (ii) the parties’ obligations to obtain relevant approvals and comply with all applicable
listing requirements of the Nasdaq in connection with the Transactions and (iii) the parties’ obligations to consummate the Transactions
and to comply as promptly as practicable with all requirements of governmental authorities applicable to the Transactions. The Business
Combination Agreement also contains additional covenants of the parties, including covenants providing for Inflection Point and the Company
to use commercially reasonable efforts to (i) consummate the PIPE Investment, (ii) agree to and adopt a new equity incentive plan and
a new employee share purchase plan, and (iii) file, and to cooperate with each other to prepare the registration statement of PubCo required
to be filed in connection with the Transactions (the “Registration Statement”), which will contain a proxy statement
of Inflection Point.
Conditions to Closing
The respective obligations
of each party to consummate the Transactions are subject to the satisfaction, or written waiver (where permissible), by the Company and
Inflection Point of the following conditions:
| ● | Inflection Point’s shareholders having approved and adopted the Shareholder Approval Matters; |
| ● | the Company Shareholder Approval having been obtained; |
| ● | the absence of any law or governmental order, inquiry, proceeding or other action that would prohibit
the Transactions; |
| |
● |
If applicable, the HSR waiting period has expired or been terminated; |
| ● | the PubCo Ordinary Shares having been conditionally approved for listing on Nasdaq, subject only to official
notice thereof; and |
| ● | the Registration Statement (and any amendments and supplements) shall have become effective in accordance
with the provisions of the Securities Act of 1933, as amended (the “Securities Act”), no stop order shall have been
issued by the SEC that remains in effect with respect to the Registration Statement, and no proceeding seeking such a stop order shall
have been threatened or initiated by the SEC and not withdrawn. |
Conditions to the Obligations of the Company
The obligations of the Company
to consummate the Transactions are subject to the satisfaction, or written waiver (by the Company, where permissible) of the following
conditions:
| ● | the representations and warranties of Inflection Point being true and
correct as of the Closing Date, subject to applicable standards as determined in accordance with the Business Combination Agreement; |
| ● | the
representations and warranties of Merger Sub being true and correct as of the Closing Date, subject to applicable standards as determined
in accordance with the Business Combination Agreement; |
| ● | Inflection Point having performed in all material respects all of its obligations and complied in all
material respects with all of its agreements and covenants under the Business Combination Agreement to be performed or complied with by
it on or prior to the Closing Date; |
| ● | Inflection Point having delivered to the Company a certificate dated as of the Closing Date, signed by
an officer of Inflection Point, certifying as to the satisfaction of certain conditions specified in the Business Combination Agreement; |
| ● | no Material Adverse Effect shall have occurred with respect to Inflection Point that is continuing and
uncured; |
| ● | Inflection Point having made all necessary and appropriate arrangements
with the trustee to have all of the funds held in the Trust Account disbursed to Inflection Point on the Closing Date, and all such funds
released from the Trust Account be available to PubCo; and |
| ● | the Ancillary Documents required to be executed by Inflection Point according to the Business Combination
Agreement at or prior to the Closing Date shall have been executed and delivered to the Company. |
Conditions to the Obligations of Inflection Point
The obligations of Inflection
Point to consummate the Transactions are subject to the satisfaction, or written waiver (by Inflection Point where permissible) of the
following conditions:
| ● | the
representations and warranties of the Company being true and correct as of the Closing Date, subject to applicable standards as determined
in accordance with the Business Combination Agreement; |
| ● | the
representations and warranties of PubCo being true and correct as of the Closing Date, subject to applicable standards as determined
in accordance with the Business Combination Agreement; |
| ● | each
of the Company and PubCo having performed in all material respects all of their respective obligations and complied in all material respects
with all of their respective agreements and covenants under the Business Combination Agreement to be performed or complied with by them
on or prior to the Closing Date; |
| ● | the
Company having delivered to Inflection Point a certificate dated as of the Closing Date, signed by the Company, certifying as to the
satisfaction of certain conditions specified in the Business Combination Agreement; |
| ● | no
Material Adverse Effect shall have occurred with respect to the Company that is continuing and uncured; and |
| ● | the
Ancillary Documents required to be executed by the Company and PubCo according to the Business Combination Agreement at or prior to the
Closing Date shall have been executed and delivered to Inflection Point. |
| ● | all
of the indebtedness outstanding under certain specified Contracts will have been discharged in full. |
Termination
The Business Combination Agreement
may be terminated and the Transactions may be abandoned at any time prior to the Closing Date, notwithstanding receipt of any requisite
approval and adoption of the Business Combination Agreement and the Transactions by the shareholders of Inflection Point or any other
party, as follows:
| ● | by
mutual written consent of Inflection Point and the Company; |
| ● | by
written notice by either Inflection Point or the Company if any of the closing conditions set forth in the Business Combination Agreement
have not been satisfied or waived by August 25, 2026 (the “Outside Date”); provided, however, that the Business Combination
Agreement may not be terminated under such provision of the Business Combination Agreement by or on behalf of any party that either directly
or indirectly through its affiliates (or with respect to the Company, the Company Shareholders or PubCo) is in breach or violation of
any representation, warranty, covenant or obligation contained therein, with such breach or violation being the principal cause of the
failure of a condition set forth in the Business Combination Agreement on or prior to the Outside Date; provided, further, that
the Outside Date shall automatically be extended by one (1) calendar day for each day after October 31, 2025 that the PCAOB Financial
Statements or the Interim Financial Statements are not delivered by the Company to Inflection Point in accordance with the terms of the
Business Combination Agreement. |
| ● | by
written notice by either Inflection Point or the Company if any governmental authority of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any Law (whether temporary, preliminary or permanent) or Order that is then in effect and which
has the effect of making the Transactions illegal or otherwise prohibiting the transactions contemplated by the Business Combination
Agreement, and such order or other action has become final and non-appealable; provided, however, that the right to terminate the Business
Combination Agreement pursuant to such section will not be available to a party if the failure by such party or its affiliates (or with
respect to the Company, the Company Shareholders or PubCo) to comply with any provision of the Business Combination Agreement was the
principal cause of such order, action or prohibition; |
| ● | by
written notice by the Company to Inflection Point upon a breach of any representation, warranty, covenant or agreement on the part of
Inflection Point set forth in the Business Combination Agreement, or if any representation or warranty of Inflection Point becomes untrue
or inaccurate, in any case such that the related closing conditions contained in the Business Combination Agreement are not satisfied,
subject to customary exceptions and cure rights; |
| ● | by
written notice by Inflection Point to the Company upon a breach of any warranty, covenant or agreement on the part of the Company or
PubCo set forth in the Business Combination Agreement, or if any representation or warranty of such parties becomes untrue or inaccurate,
in any case such that the related closing conditions contained in the Business Combination Agreement are not satisfied, subject to customary
exceptions and cure rights; |
| ● | by
written notice by the Company to Inflection Point if the Company Funding Threshold has not been achieved on or prior to the date that
is two (2) Business Days following the Effective Date; |
| ● | by
written notice by the Company to Inflection Point if Inflection Point or the SPAC Securities are no longer listed on the Nasdaq or another
national securities exchange; |
| ● | by
written notice by either Inflection Point or the Company if the special meeting of shareholders is held and has concluded, Inflection
Point shareholders have duly voted, and the Required Shareholder Approval is not obtained; or |
| ● | by
Inflection Point if the Company Shareholder Approval is not obtained within ten (10) Business Days after the Registration Statement Effective
Date (subject to certain conditions). |
The foregoing summary of the
Business Combination Agreement is qualified in its entirety by reference to the entire text of the Business Combination Agreement, which
is attached as Exhibit 2.1 hereto, and the Ancillary Documents, the terms of each of which are incorporated herein by reference. The Business
Combination Agreement contains representations, warranties and covenants that the respective parties thereto made to each other as of
the date of the Business Combination Agreement or other specific dates. The assertions embodied in those representations, warranties and
covenants were made for purposes of the contract among the respective parties and are subject to important qualifications and limitations
agreed to by the parties in connection with negotiating such agreement. In particular, the assertions embodied in the representations
and warranties in the Business Combination Agreement were made as of a specified date, are modified or qualified by information in one
or more confidential disclosure letters prepared in connection with the execution and delivery of the Business Combination Agreement,
may be subject to a contractual standard of materiality different from what might be viewed as material to investors, or may have been
used for the purpose of allocating risk between the parties. Accordingly, the representations and warranties in the Business Combination
Agreement are not necessarily characterizations of the actual state of facts about Inflection Point, PubCo, Merger Sub, the Company Shareholders
or the Company at the time they were made or otherwise and should only be read in conjunction with the other information that Inflection
Point makes publicly available in reports, statements and other documents filed with the SEC.
Company Support Agreement
Concurrently with the execution
of the Business Combination Agreement, Inflection Point entered into Company Support Agreements (each, a “Company Support Agreement”)
with the Company, PubCo and certain shareholders of the Company (collectively, the “Supporting Stockholders”), pursuant
to which each Supporting Stockholder has agreed to, among other things, (a) vote the Company Ordinary Shares held by such Supporting Stockholder
(together with any other equity securities thereafter acquired by such Supporting Stockholder the “Company Subject Securities”)
in favor of the Business Combination Agreement and the transactions contemplated thereby, (b) be bound by certain other covenants and
agreements related to the Transactions (c) be bound by certain transfer restrictions with respect to the Company Subject Securities and
(d) waive its dissenter rights under Section 238 of the Cayman Act and any other similar statute.
The foregoing description
of the Company Support Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Company
Support Agreement filed as Exhibit 10.1 hereto and incorporated by reference herein.
The Company Support Agreement
expires upon the earlier of the Second Merger Effective Time and the termination of the Business Combination Agreement.
Sponsor Support Agreement
In connection with the execution
of the Business Combination Agreement, Sponsor has entered into a Sponsor Support Agreement (the “Sponsor Support Agreement”)
with Inflection Point, PubCo and the Company, pursuant to which Sponsor has agreed to, among other things, (a) vote the SPAC Class
B Ordinary Shares and the SPAC Class A Ordinary Shares held by Sponsor (together with any other equity securities thereafter acquired
by Sponsor, the “Sponsor Subject Securities”) in favor of the Shareholder Approval Matters at any meeting of Inflection
Point shareholders to be called for approval of the Transactions (b) waive its anti-dilution rights in the SPAC Charter, (c) waive
its dissenter rights under Section 238 of the Cayman Act and any other similar statute, (d) be bound by certain other covenants and agreements
related to the Transactions and (e) be bound by certain transfer restrictions with respect to the Sponsor Subject Securities, in
each case, on the terms and subject to the conditions set forth in the Sponsor Support Agreement. The Sponsor Support Agreement also provides
that Sponsor has agreed irrevocably to waive its redemption rights in connection with the consummation of the Transactions with respect
to any Sponsor Subject Securities they may hold.
The foregoing summary of the
Sponsor Support Agreement is qualified in its entirety by reference to the full text of the Sponsor Support Agreement, which is attached
as Exhibit 10.2 hereto and the terms of which are incorporated herein by reference.
The Sponsor Support Agreement expires upon the earlier of the First
Merger Effective Time and the termination of the Business Combination Agreement.
Lock-Up Agreements
In connection with the
Closing, each holder of the Company Ordinary Shares will each enter into an agreement (the “Company
Shareholder Lock-Up Agreement”) providing that each holder of the Company Ordinary Shares will not, subject to certain
customary exceptions, transfer its Restricted Securities (as defined in the Company Shareholder Lock-Up Agreements) during the
period commencing from the Closing Date until the earlier of (i) six months after the Closing or (ii) the date following the Closing
on which PubCo completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction in which all of
its shareholders have the right to exchange their shares of common stock for cash, securities or other property.
In connection with the Closing,
Sponsor and certain other SPAC Shareholders who are members of Inflection Point’s board of directors and/or management team (such
individuals, the “Insiders”) will enter into an agreement (the “Sponsor Lock-Up Agreement”) providing
that Sponsor and the Insiders will not, subject to certain customary exceptions, transfer (i) the General Restricted Securities (as defined
below) during the period commencing from the Closing Date until the date that is the earlier of (x) six months after the Closing and (y)
the date following the Closing on which PubCo completes a liquidation, merger, capital stock exchange, reorganization or other similar
transaction that results in all of its shareholders having the right to exchange their shares of common stock for cash, securities or
other property or (ii) the Private Placement Restricted Securities (as defined below) during the period commencing from the Closing Date
until the date that is the earliest of (x) 30 days after the Closing and (y) the date following the Closing on which PubCo completes a
liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of its shareholders having
the right to exchange their shares of common stock for cash, securities or other property. For purposes of the Sponsor Lock-Up Agreement,
(a) the “Private Placement Restricted Securities” means the PubCo Ordinary Shares issued to the Sponsor pursuant to
the Business Combination Agreement in exchange for the 500,000 units consisting of one SPAC Class A Ordinary Share and one right to receive
one-tenth of one SPAC Class A Ordinary Share upon Closing following the unit separation (together with any dividends or distributions
with respect to such securities or into which such securities are changed or exchanged or which are received in any recapitalization,
share exchange, share conversion or similar transactions), and (b) the “General Restricted Securities” means the PubCo
Ordinary Shares issued to the Sponsor or the Insiders in exchange for the SPAC Class A Ordinary Shares received by Sponsor or the Insiders
upon conversion of the SPAC Class B Ordinary Shares, pursuant to the terms of the Business Combination Agreement (together with any dividends
or distributions with respect to such securities or into which such securities are changed or exchanged or which are received in any recapitalization,
share exchange, share conversion or similar transactions).
The foregoing summaries of
the Company Shareholder Lock-Up Agreement and the Sponsor Lock-Up Agreement are qualified in their entirety by reference to the full text
of the form of Sponsor Lock-Up Agreement and the form of Company Shareholder Lock-Up Agreement, which are attached as Exhibits 10.3 and
10.4 hereto, respectively, and the terms of which are incorporated herein by reference.
New Registration Rights Agreement
The Business Combination Agreement
contemplates that, at the Closing, PubCo, certain Company equityholders, Sponsor, Inflection Point, and the other parties signatory thereto
will enter into a Registration Rights Agreement (the “New Registration Rights Agreement”), pursuant to which PubCo
will agree to register for resale certain shares of PubCo Registrable Securities that are held by the parties thereto from time to time.
Pursuant to the New Registration Rights Agreement, among other things, PubCo will agree to file a shelf registration statement registering
the sale or resale of all of the Registrable Securities (as defined in the New Registration Rights Agreement) no later than 30 days after
the Closing Date. Pursuant to the New Registration Rights Agreement, PubCo will also provide customary “piggyback” registration
rights, subject to certain requirements and customary conditions. The New Registration Rights Agreement also provides that PubCo will
pay certain expenses relating to such registrations and indemnify the shareholders against certain liabilities.
The foregoing summary of the
New Registration Rights Agreement is qualified in its entirety by reference to the full text of the form of New Registration Rights Agreement,
which is attached as Exhibit 10.5 hereto and the terms of which are incorporated herein by reference.
Series A Preferred Shares Investment
In connection with the transactions
contemplated by the Business Combination Agreement, the Company entered into (i) the Pre-Funded PIPE Subscription Agreement with certain
investors identified on the signature pages thereto (collectively, the “Series A-1 Investors”), pursuant to which the
Pre-Funded PIPE Investors have agreed to purchase approximately $32.5 million (the “Series A-1 Investment”) of Company
Series A-1 Preferred Shares and Company Warrants (the “Signing PIPE Securities”), which transactions have been consummated
concurrently with the execution of the Business Combination Agreement and (ii) the Closing PIPE Subscription Agreement (together with
the Pre-Funded PIPE Subscription Agreement, the “Subscription Agreements”) with certain investors identified on the
signature pages thereto, pursuant to which the Closing PIPE Investors have agreed to purchase approximately $31 million (the “Series
A-2 Investment” and together with the Series A-1 Investment, the “Series A Investments”) of Company Series
A Preferred Shares and Company Warrants (together with the Signing PIPE Securities, the “Securities”), which transactions
will be consummated immediately prior to the Second Merger Effective Time.
The Subscription Agreements
include customary representations and warranties from the Company and the Series A Investors and customary closing conditions. The Subscription
Agreements also include customary covenants and agreements related to transfer restrictions and indemnification. In addition, PubCo and
the Series A Investors will enter into registration rights agreements providing for customary registration rights for the Securities.
Dividends: The PubCo
Series A Preferred Shares will accrue dividends daily at the rate of 12% per annum of the Accrued Value (as defined in the PubCo A&R
Articles) (if paid in kind), or 10% per annum of the Accrued Value (if paid in cash). Such dividends will compound semi-annually.
Liquidation Preference:
Upon a Deemed Liquidation Event, Disposal or on a distribution of assets on a liquidation, dissolution or winding up of the Company (whether
voluntarily or involuntarily) or a return of capital (other than a conversion, redemption, buyback or purchase of PubCo securities), the
holders of PubCo Series A Preferred Shares will be entitled to receive out of the available proceeds, before any distribution is made
to holders of ordinary shares or any other junior securities, an amount per share equal to the greater of (i) 100% of the Accrued Value
(as defined in the PubCo A&R Articles) or (ii) such amount per share as would have been payable had all shares of PubCo Series A Preferred
Shares been converted into PubCo Ordinary Shares immediately prior to such event.
Voting: The PubCo Series
A Preferred Shares votes together with the PubCo Ordinary Shares on an as-converted basis, except as required by law and as noted below
under “Protective Provisions.” Each holder of PubCo Series A Preferred Shares shall be entitled to cast the number of votes
equal to the number of whole shares of PubCo Ordinary Shares into which the shares of PubCo Series A Preferred Shares held by such holder
are convertible as of the record date for determining shareholders entitled to vote on such matter.
Protective Provisions:
For as long as Inflection Point Asset Management LLC, Newtyn Management, LLC and their respective Affiliates hold at least 20% of the
PubCo Series A Preferred Shares on issue as of Closing, the Company shall not, without the Series A Majority Consent (as defined therein)
(the “Requisite Holders”), take any of the following actions: (a) liquidate, dissolve or wind-up the affairs of PubCo,
(b) create any equity security, authorise the creation of any equity security, classify any equity security, reclassify any equity security,
or issue any other security convertible into or exercisable for any equity security, unless such security ranks junior to the PubCo Series
A Preferred Shares with respect to its rights, preferences and privileges (including rights to receive dividends and participate in distributions
or payments upon liquidation, dissolution or winding up), (c) increase the authorised share capital of the PubCo Series A Preferred Shares,
(d) purchase or redeem or pay any cash dividend on any PubCo security ranking junior to the PubCo Series A Preferred Shares (with respect
to rights to receive dividends and participate in distributions or payments upon liquidation, dissolution or winding up), except for PubCo
securities being repurchased by the Company at cost from employees in connection with the cessation of their service or pursuant to the
terms of any equity incentive plan adopted by PubCo, (e) enter into any transaction with an affiliate, other than the issuance of equity
or awards to eligible participants under an incentive plan, equity plan or equity-based compensation plan adopted by PubCo, or with respect
to employment, consulting or award agreements with respect to executive officers or directors of PubCo, in each case regardless of whether
such person (or such person’s affiliates) would be considered an affiliate of PubCo, or (f) incur or guarantee any new indebtedness
other than equipment leases or trade payables incurred in the ordinary course of business.
Conversion: Each PubCo
Series A Preferred Share will be convertible into PubCo Ordinary Shares at any time at the option of the holder at a rate equal to the
Accrued Value, divided by the then-applicable conversion price. The conversion price will initially be $12.00, subject to equitable adjustment
and adjustments for stock dividends, splits, combinations and similar events and customary anti-dilution adjustments, including with respect
to future issuances or sales of PubCo Ordinary Shares at prices less than the lesser of (x) $10.00 (subject to equitable adjustment) and
(y) the conversion price then in effect. In addition, if the 20-day volume-weighted average price of the PubCo Ordinary Shares commencing
on the date that is six months after the Closing Date is less than the conversion price then in effect, the conversion price will be subject
to a one-time downward adjustment equal to the greater of (i) such volume weighted average price and (ii) $5.00 (subject to equitable
adjustment).
Put Rights: Unless
prohibited by applicable law governing distributions to shareholders, the PubCo Series A Preferred Shares shall be redeemable at the option
of the Requisite Holders commencing any time after the fifth anniversary of the Closing at a price equal to the 100% of the Accrued Value.
Call Rights: Unless
prohibited by applicable law governing distributions to shareholders, the PubCo Series A Preferred Shares shall be redeemable at the option
of PubCo commencing any time (A) after the Closing but prior to the 1st anniversary of the Closing at a price equal to the 150% of the
Accrued Value, (B) after the 1st anniversary but prior to the 2nd anniversary of the Closing at a price equal to the 140% of the Accrued
Value, (C) after the 2nd anniversary of the Closing but prior to the 3rd anniversary of the Closing at a price equal to the 130% of the
Accrued Value, (D) after the 3rd anniversary of the Closing but prior to the 4th anniversary of the Closing at a price equal to the 120%
of the Accrued Value, (E) after the 4th anniversary of the Closing but prior to the 5th anniversary of the Closing at a price equal to
the 110% of the Accrued Value, or (F) after the 5th anniversary of the Closing at a price equal to the 100% of the Accrued Value.
Share Purchase Warrants:
The PubCo Series A Investor Warrant will be immediately exercisable upon issuance at Closing and will expire five years from the date
of Closing. The PubCo Series A Investor Warrants include customary cash and cashless exercise provisions. Each PubCo Series A Investor
Warrant is initially exercisable at $12.00 per PubCo Ordinary Share, subject to equitable adjustment and the same anti-dilution and other
adjustments as the PubCo Series Preferred Shares.
The foregoing description
of the Series A Investments, the PubCo Series A Preferred Shares, and the PubCo Series A Investor Warrants are subject to and qualified
in its entirety by reference to the full text of the Subscription Agreements, copies of which is included as Exhibits 10.6 and 10.7 hereto,
the PubCo A&R Articles, a copy of which is included as Exhibit 3.1, and the full text of the form of Company Warrants and the PubCo
Series A Investor Warrants, copies of which is included as Exhibits 4.1 and 4.2 hereto, and the terms of each is incorporated herein by
reference.
Item 3.02 Unregistered Sales of Equity Securities.
The disclosure set forth above
in Item 1.01 of this Report is incorporated by reference herein. The PubCo Ordinary Shares to be issued to the Company’s shareholders
in respect of the Company shares in connection with the Second Merger will not be registered under the Securities Act, in reliance upon
the exemption provided in Section 4(a)(2) of the Securities Act or Regulation D promulgated thereunder.
Item 5.02 Departure of Directors or Certain
Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On August 20, 2025, Daniel
Hoffman resigned from the Board of Directors of the Company due to a potential conflict between his role as a director of the Company
and his other professional commitments. The decision of Mr. Hoffman was not the result of any disagreement with the Company on any matter
relating to the Company’s operations, policies or practices.
Effective upon Mr. Hoffman’s
resignation as a director, the size of the Company’s Board of Directors was reduced from five to four.
Item 7.01 Regulation FD Disclosure.
Furnished herewith as Exhibit
99.1 and incorporated into this Item 7.01 by reference is the press release jointly issued by the parties announcing the Transactions.
Furnished herewith as Exhibit 99.2 and incorporated into this Item 7.01 by reference is the investor presentation that was presented to
certain potential investors in connection with the Transactions. Furnished as Exhibit 99.3 hereto and incorporated into this Item 7.01
by reference is certain projected financial information that the Company prepared in connection with Inflection Point’s consideration
of the Business Combination and certain investors’ assessment of a potential investment in the Company.
The information set forth
below under this Item 7.01, including the exhibits attached hereto, is intended to be furnished and shall not be deemed “filed”
for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject
to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange
Act, except as expressly set forth by specific reference in such filing.
Forward-Looking Statements
Certain statements made herein
are not historical facts but may be considered “forward-looking statements” within the meaning of Section 27A of the Securities
Act, Section 21E of the Exchange Act and the “safe harbor” provisions under the Private Securities Litigation Reform Act of
1995. Forward-looking statements generally are accompanied by words such as “believe,” “may,” “will,”
“estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,”
“would,” “plan,” “predict,” “potential,” “seem,” “seek,” “future,”
“outlook” or the negatives of these terms or variations of them or similar terminology or expressions that predict or indicate
future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited
to, statements regarding future events, the expectation that the Transactions between Inflection Point and the Company will occur and
that PubCo will be listed on Nasdaq, the estimated or anticipated future results and benefits of PubCo following the Transactions, including
its ability to successfully execute is business plan, the likelihood and ability of the parties to successfully consummate the Transactions
and future opportunities for PubCo and other statements that are not historical facts.
These statements are
based on the current expectations of Inflection Point’s and/or the Company’s management and are not predictions of actual
performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not
be relied on, by any investor as a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events
and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond
the control of Inflection Point and the Company. These statements are subject to a number of risks and uncertainties regarding the Company’s
business and the Transactions, and actual results may differ materially. These risks and uncertainties include, but are not limited to:
general economic, political and business conditions; the inability of the parties to consummate the Transactions or the intended financing;
the occurrence of any event, change or other circumstances that could give rise to the termination of the Business Combination Agreement;
the number of redemption requests made by Inflection Point’s shareholders in connection with the Transactions; the outcome of any
legal proceedings that may be instituted against the parties following the announcement of the Transactions; the risk that the approval
of Inflection Point’s shareholders for the potential transaction is not obtained; the anticipated capitalization and enterprise
value of PubCo following the consummation of the Transactions; the ability of PubCo to issue equity, equity-linked or other securities
in the future; expectations related to the terms and timing of the Transactions; failure to realize the anticipated benefits of the Transactions,
including as a result of a delay in consummating the Transactions; the risk that the Transactions may not be completed by Inflection Point’s
business combination deadline and the potential failure to obtain an extension of its business combination deadline, if sought by Inflection
Point; the risks related to the rollout of the Company’s business and the timing of expected business milestones; the ability of
PubCo to execute its growth strategy, manage growth profitably and retain its key employees; the ability of PubCo to obtain or maintain
the listing of its securities on the Nasdaq following the Transactions; costs related to the Transactions; and other risks that will be
detailed from time to time in filings with the SEC, including those risks discussed under the heading “Risk Factors” in Inflection
Point’s final prospectus for its initial public offering filed with the SEC on April 25, 2025. The foregoing list of risk factors
is not exhaustive. There may be additional risks that could also cause actual results to differ from those contained in these forward-looking
statements. In addition, forward-looking statements provide Inflection Point’s expectations, plans or forecasts of future events
and views as of the date of this Report. And while Inflection Point may elect to update these forward-looking statements in the future,
Inflection Point specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing
Inflection Point’s assessments as of any date subsequent to the date of this Report. Accordingly, undue reliance should not be placed
upon the forward-looking statements. Nothing herein should be regarded as a representation by any person that the forward-looking statements
set forth herein will be achieved or that the results of such forward-looking statements will be achieved.
Additional Information and Where to Find It
In connection with the Transactions,
Inflection Point, the Company and PubCo are expected to prepare the Registration Statement to be filed with the SEC by PubCo, which will
include preliminary and definitive proxy statements to be distributed to Inflection Point’s shareholders in connection with Inflection
Point’s solicitation for proxies for the vote by Inflection Point’s shareholders in connection with the Transactions and other
matters as described in the Registration Statement, as well as the prospectus relating to the offer of the securities to be issued to
the Company’s shareholders in connection with the completion of the Transactions. After the Registration Statement has been filed
and declared effective, Inflection Point will mail a definitive proxy statement and other relevant documents to its shareholders as of
the record date established for voting on the Transactions. Inflection Point’s shareholders and other interested persons are advised
to read, once available, the preliminary proxy statement/prospectus and any amendments thereto and, once available, the definitive proxy
statement/prospectus, in connection with Inflection Point’s solicitation of proxies for its special meeting of shareholders to be
held to approve, among other things, the Transactions, because these documents will contain important information about Inflection Point,
the Company, PubCo and the Transactions. This Report is not a substitute for the Registration Statement, the definitive proxy statement/prospectus
or any other document that Inflection Point will send to its shareholders in connection with the Transactions.
INVESTORS AND SECURITY HOLDERS
ARE ADVISED TO READ, WHEN AVAILABLE, THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS FILED WITH
THE SEC CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE TRANSACTIONS
AND THE PARTIES TO THE TRANSACTIONS. Investors and security holders will be able to obtain copies of these documents (if and when available)
and other documents filed with the SEC free of charge at www.sec.gov. The definitive proxy statement/final prospectus (if and when available)
will be mailed to shareholders of Inflection Point as of a record date to be established for voting on the business combination. Shareholders
of Inflection Point will also be able to obtain copies of the proxy statement/prospectus without charge, once available, at the SEC’s
website at www.sec.gov, or by directing a request to: Inflection Point Acquisition Corp. III, 167 Madison Avenue Suite 205 #1017, New
York, New York 10016.
Participants in the Solicitation
Inflection Point and its directors,
executive officers, and other members of management, and consultants, under SEC rules, may be deemed participants in the solicitation
of proxies from Inflection Point’s shareholders with respect to the Business Combination. A list of the names of those directors
and executive officers and a description of their interests in Inflection Point is contained in the sections entitled “Principal
Shareholder” and “Management— Conflicts of Interest” of Inflection Point’s final prospectus (File
333-283427) for its initial public offering, filed with the SEC on March 10, 2025, and which is available free of charge at the SEC’s
website at www.sec.gov, and at the following URL: sec.gov/Archives/edgar/data/2012318/000121390025035659/ea0222072-08.htm#T99012.
Additional information regarding the interests of such participants will be contained in the Registration Statement when available.
The Company, PubCo, and their
respective directors, executive officers, other members of management, and employees, under SEC rules, may be deemed participants in the
solicitation of proxies of Inflection Point’s shareholders in connection with the Business Combination. A list of the names of such
directors and executive officers and information regarding their interests in the Business Combination will be included in the Registration
Statement when available.
No Offer or Solicitation
This Report is for informational
purposes only and is neither an offer to purchase, nor a solicitation of an offer to sell, subscribe for or buy any securities or the
solicitation of any vote in any jurisdiction pursuant to the Transactions or otherwise, nor shall there be any sale, issuance or transfer
of securities in any jurisdiction in contravention of applicable law. No offer of securities shall be made except by means of a prospectus
meeting the requirements of Section 10 of the Securities Act.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit |
|
Description |
| 2.1† |
|
Business Combination Agreement, dated as of August 25, 2025, by and
among Inflection Point Acquisition Corp. III, Air Water Ventures Holdings Limited, IPCX Merger Sub Limited, and Air Water Ventures Limited. |
| 3.1 |
|
Amended and Restated Memorandum and Articles of Association of Air Water Ventures Limited |
| 4.1 |
|
Form of Signing Share Purchase Warrant |
| 4.2 |
|
Form of Closing Share Purchase Warrant |
| 10.1 |
|
Company Support Agreement, dated as of August 25, 2025, by and among TAU Capital Holding Limited, Inflection Point Acquisition Corp. III, Air Water Ventures Holdings Limited and Air Water Ventures Limited |
| 10.2 |
|
Sponsor Support Agreement, dated as of August 25, 2025, by and among Inflection Point Acquisition Corp. III, Air Water Ventures Holdings Limited and Air Water Ventures Limited. |
| 10.3 |
|
Form of Sponsor Lock-Up Agreement. |
| 10.4 |
|
Form of Company Lock-Up Agreement. |
| 10.5 |
|
Form of New Registration Rights Agreement. |
| 10.6 |
|
Form of Pre-Funded PIPE Subscription Agreement. |
| 10.7 |
|
Form of Closing PIPE Subscription Agreement. |
| 99.1 |
|
Press Release, dated August 25, 2025, issued by the parties announcing
the Transactions. |
| 99.2 |
|
Investor Presentation. |
| 99.3 |
|
Certain Projected Financial Information of the Company, dated August 2025. |
| 104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
| † |
Certain of the exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Registrant agrees to furnish supplementally a copy of all omitted exhibits and schedules to the Securities and Exchange Commission upon its request. |
SIGNATURE
Pursuant to the requirements
of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this Report to be signed on its behalf by the undersigned
hereunto duly authorized.
Dated: August 25, 2025
| INFLECTION POINT ACQUISITION CORP. III |
|
| |
|
| By: |
/s/ Michael Blitzer |
|
| Name: |
Michael Blitzer |
|
| Title: |
Chief Executive Officer |
|
13
