aibioBellevue Life Sciences Acquisition (now OSR Health) lends $300,000 to OSR Holdings
Tickers OSRH
Bellevue's note to its merger partner bears interest at 3.96% a year and is due on October 25, 2025. Bellevue's chief executive is also chairman of OSR Holdings.
Key facts
- Company
- OSR Health, Inc. (OTC: OSRH)
- News type
- Mergers
- Primary source
- OSR Health, Inc. 8-K (2024-10-28)
The loan
Bellevue Life Sciences Acquisition Corp. (Nasdaq: BLAC), a special purpose acquisition company, advanced a loan of $300,000 to OSR Holdings Co., Ltd. on October 25, 2024. It reported the loan in an 8-K signed on October 28, 2024. OSR Holdings is the Korean company that Bellevue has agreed to combine with, and Bellevue is now known as OSR Health, Inc.
The loan is evidenced by a promissory note that bears interest at 3.96% per annum, compounded semi-annually. The principal falls due on the one-year anniversary of the note, October 25, 2025, and accrued interest is payable on that date. The note may be prepaid at any time. The 8-K says OSR Holdings is to use the funds for working capital and other expenses, and the note itself contains no clause limiting how the money is spent.
What happens on a default
The 8-K lists two events of default: a failure to pay the balance within five business days of the maturity date, and the start of a voluntary or involuntary bankruptcy action. The note is broader than that summary. A voluntary case includes consenting to a receiver, making an assignment for the benefit of creditors, or failing generally to pay debts as they come due. An involuntary case counts only if the court's order remains unstayed and in effect for 60 consecutive days.
If OSR Holdings does not pay on time, Bellevue may declare the note immediately due by written notice. In a bankruptcy default the balance becomes due automatically. The note says no manager, member, officer, director, employee or stockholder of OSR Holdings is personally liable for it. It is governed by New York law, and any amendment needs the written consent of both sides. The note does not describe any collateral.
The merger behind the loan
Bellevue signed a Business Combination Agreement with OSR Holdings on November 16, 2023 and amended and restated it on May 23, 2024. OSR Holdings stockholders may join the deal as participating or non-participating holders, each through a form of joinder. Bellevue has filed a registration statement on Form S-4 containing a preliminary proxy statement and prospectus. The 8-K says a definitive proxy will go to Bellevue stockholders once a record date is set, and it gives no date for the vote.
Bellevue also signed a subscription agreement with Toonon Partners Co., Ltd. on October 4, 2024. Toonon agreed to buy 222,222 shares of Series A Preferred Stock for $20,000,000, or $90.00 per share. That agreement was disclosed in an 8-K filed on October 10, 2024.
Bellevue's securities trade on Nasdaq: units (BLACU), common stock (BLAC), redeemable warrants exercisable at $11.50 a share (BLACW) and rights to receive one-tenth of a share of common stock (BLACR). The company checks the emerging growth company box on the cover page.
One executive on both sides
Kuk Hyoun Hwang, Bellevue's chief executive, signed the 8-K and also acknowledged the note for Bellevue. Sang Hoon Kim, chief executive of OSR Holdings, signed the note for the borrower. Bellevue has disclosed that Mr. Hwang is also Chairman of the Board of OSR Holdings. The lender's chief executive therefore sits on the borrower's board, so the loan was agreed between companies that share an executive.
What the filing does not say
The 8-K does not say where Bellevue found the $300,000. It does not say whether the money came from the trust account that holds funds raised in the SPAC's offering, from the sponsor or from other cash. It gives no financial statements, revenue, debt or cash figures for OSR Holdings, and it does not explain why the company needed a loan before the merger closes.
It also puts no value on the merger, gives no closing date and describes no OSR Holdings business or product. Repayment by October 25, 2025 depends on a borrower whose finances the filing never describes. The 8-K is marked as a written communication under Rule 425, and it directs readers to the S-4 and the proxy statement for more.