PowerUp Acquisition Corp. (NASDAQ:PWUP), a pharmaceutical preparations company, has entered into a Promissory Note Fee Agreement with its sponsor, SRIRAMA Associates, LLC, as disclosed in a recent SEC filing. The agreement, dated October 2, 2024, stipulates that PowerUp will pay a $1 million fee to SRIRAMA Associates upon the successful closing of a business combination with Aspire Biopharma, Inc.
This payment is a result of SRIRAMA Associates taking a significant financial risk on behalf of PowerUp, as it had previously extended a $2 million convertible promissory note to Visiox Pharmaceuticals, Inc. for PowerUp's benefit. Initially, SRIRAMA Associates was to receive a fee upon the successful merger between PowerUp and Visiox under a business combination agreement signed on December 26, 2023. However, the termination of this agreement on July 22, 2024, nullified the original fee arrangement.
In other recent news, PowerUp Acquisition Corp has ended its merger agreement with Visiox Pharmaceuticals, Inc. The termination was due to the failure to satisfy closing conditions by the set deadline. The merger was initially intended to transform Visiox into a wholly-owned subsidiary of PowerUp. Following a thorough review of the merger's terms and conditions, both companies have ceased the merger process.
The financial terms and specific details of the terminated agreement, including any termination fees or penalties, have not been disclosed. PowerUp, now actively seeking alternative business combination opportunities, has noted that there's no certainty that this search will result in any new transaction.
InvestingPro Insights
Recent data from InvestingPro sheds additional light on PowerUp Acquisition Corp.'s financial position and market performance. The company's market capitalization stands at $96.37 million, reflecting its current valuation in the pharmaceutical preparations sector. Notably, PowerUp has seen a significant year-to-date price total return of 20.99%, indicating strong market interest in the stock, possibly driven by its merger and acquisition activities.
InvestingPro Tips highlight that PowerUp is not currently profitable over the last twelve months, which aligns with the company's focus on strategic moves such as the potential business combination with Aspire Biopharma, Inc. Additionally, the company does not pay a dividend to shareholders, suggesting that it may be reinvesting capital into growth initiatives or merger-related activities.
For investors seeking a more comprehensive analysis, InvestingPro offers 6 additional tips that could provide deeper insights into PowerUp's financial health and market position. These additional tips could be particularly valuable in assessing the potential impact of the company's ongoing merger and acquisition strategy.
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