FOREST ROAD ACQUISITION CORP. II Item 1.01 Entry into a Material Definitive Agreement.
Merger Agreement
On
HyperloopTT is an innovative transportation and technology licensing company
focused on realizing the hyperloop, which is a vacuum tube-based system that is
capable of transporting passengers and goods in levitating capsules at airplane
speeds on the ground. Founded in 2013, HyperloopTT is headquartered in
Acquiror intends to file a registration statement on Form S-4 as soon as reasonably practicable and it is currently anticipated that the transaction will close in the first half of 2023.
The Mergers
The Merger Agreement provides that, among other things and upon the terms and subject to the conditions thereof, the following transactions will occur (together with the other agreements and transactions contemplated by the Merger Agreement, the "Business Combination"):
(i) at the closing of the transactions contemplated by the Merger Agreement (the
"Closing"), in accordance with the Delaware General Corporation Law, as
amended, and the Delaware Limited Liability Companies Act, as amended, (x)
Merger Sub I will be merged with and into HyperloopTT (the "First Merger"),
with HyperloopTT being the surviving entity in the First Merger and
continuing (immediately following the First Merger) as a direct, wholly-owned
Subsidiary of Acquiror (the "Initial Surviving Entity"); and (y) immediately
following the First Merger, the Initial Surviving Entity will be merged with
and into Merger Sub II (the "Second Merger"), with Merger Sub II being the
surviving entity in the Second Merger and continuing (immediately following
the Second Merger) as a direct, wholly-owned Subsidiary of Acquiror (the
"Surviving Entity") (the First Merger together with the Second Merger, the
"Mergers"). Following the Mergers, Acquiror will change its name to
"Hyperloop Transportation Technologies, Inc. " ("New HyperloopTT");
(ii) in connection with the Mergers, among other things, (a) all outstanding
shares of HyperloopTT common stock (including both Class A and Class B
shares of common stock) will be cancelled in exchange for the right to
receive, in the aggregate, a number of shares of common stock in New
HyperloopTT that is approximately equal to the quotient obtained by dividing
(x) the Closing Consideration Value (as defined below) by (y) $10.00 (the
"Exchange Ratio"); (b) all outstanding shares of HyperloopTT preferred stock
will be cancelled in exchange for the right to receive, in the aggregate, a
number of shares of common stock in New HyperloopTT that is approximately
equal to the product of (x) that number of shares of common stock that such
shares of preferred stock would otherwise convert into at the effective time
of the First Merger (the "First Effective Time") and (y) the Exchange Ratio;
(c) each HyperloopTT option (whether vested or unvested) and each
outstanding HyperloopTT warrant that is outstanding and unexercised as of
immediately prior to the First Effective Time shall be assumed and converted
into a right to purchase a number of shares of Acquiror common stock, with
each such Acquiror option and warrant then representing the right to
purchase (x) the number of whole shares of Acquiror common stock equal to
the product of (A) the number of HyperloopTT common or preferred stock, as
applicable, subject to such HyperloopTT option or warrant, as applicable,
immediately prior to the First Effective Time and (B) the Exchange Ratio,
(y) at an exercise price per share of Acquiror common stock (rounded up to
the nearest whole cent) equal to the quotient obtained by dividing (A) the
exercise price per HyperloopTT common preferred stock applicable to such
HyperloopTT option or warrant, as applicable, immediately prior to the First
Effective Time by (B) the Exchange Ratio; and (d) certain HyperloopTT
convertible notes will be extinguished and cancelled and converted into
shares of HyperloopTT common stock or Acquiror common stock; and
(iii) upon the effective time of the Second Merger, the name of the Acquiror will
be renamed "Hyperloop Transportation Technologies, Inc. "
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"Closing Consideration Value" means the quotient of (a)
The Board of Directors of Acquiror (the "Board") has (i) unanimously approved and declared advisable the Merger Agreement and the Business Combination and (ii) resolved to recommend approval of the Merger Agreement and related matters by the shareholders of Acquiror.
Conditions to Closing
The Merger Agreement is subject to the satisfaction or waiver of certain
customary closing conditions by the parties thereto, including, among others,
(i) approval of the Business Combination and related agreements and transactions
by the equityholders of Acquiror and HyperloopTT, (ii) effectiveness of the
registration statement on Form S-4 to be filed by Acquiror in connection with
the Business Combination, (iii) expiration or termination of the waiting period
under the Hart-Scott-Rodino Antitrust Improvements Act, (iv) receipt of approval
for listing on the
Other conditions to HyperloopTT's and Acquiror's obligations to consummate the
Business Combination include, among others, that there will be Available Cash
(as defined below) equal to no less than
"Available Cash" means an amount equal to (i) all cash available in the trust account into which the proceeds of Acquiror's initial public offering and private placements of its warrants have been deposited for the benefit of Acquiror, certain of its public shareholders and the underwriters of Acquiror's initial public offering (the "Trust Account"), after deducting the amount required to satisfy Acquiror's obligations to its shareholders (if any) that exercise their rights to redeem the Acquiror common stock held by them plus (ii) the aggregate amount of cash that has been funded to and remains with, or that will be funded concurrently with the Closing to, Acquiror or HyperloopTT pursuant to or in connection with (a) any equity, equity linked or other financing commitment and (b) the exercise of any HyperloopTT options.
Covenants . . .
Item 7.01 Regulation FD Disclosure
On
Furnished as Exhibit 99.2 hereto is the investor presentation that will be used by the Company in connection with the Business Combination.
Furnished as Exhibit 99.3 hereto is the HyperloopTT "Imagine" video script that will be used by the Company in connection with the Business Combination.
The information in this Item 7.01 and Exhibits 99.1, 99.2and 99.3 attached hereto will not be deemed "filed" for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor will it be deemed incorporated by reference in any filing under the Securities Act of 1933 (the "Securities Act") or the Exchange Act, except as expressly set forth by specific reference in such filing.
Important Information About the Business Combination and Where to Find It
In connection with the proposed Business Combination, the Company intends to
file a preliminary proxy statement/prospectus and a definitive proxy
statement/final prospectus with the
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Participants in the Solicitation
The Company, the Company's directors and executive officers and the Sponsor may
be deemed participants in the solicitation of proxies from the Company'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
the Company is contained in the Registration Statement on Form S-1, which was
initially filed by the Company with the
HyperloopTT and its respective directors and executive officers may also be deemed to be participants in the solicitation of proxies from the shareholders of the Company 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 definitive proxy statement/final prospectus for the proposed Business Combination when available.
Forward-Looking Statements
This Current Report on Form 8-K includes "forward-looking statements" within the
meaning of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. The Company's and HyperloopTT's actual results may differ
from their expectations, estimates and projections and consequently, you should
not rely on these forward looking statements as predictions of future events.
Words such as "expect," "estimate," "project," "budget," "forecast,"
"anticipate," "intend," "plan," "may," "will," "could," "should," "believes,"
"predicts," "potential," "continue," and similar expressions are intended to
identify such forward-looking statements. These forward-looking statements
include, without limitation, the Company's and HyperloopTT's expectations with
respect to future performance and anticipated financial impacts of the Business
Combination, the satisfaction of the closing conditions to the Business
Combination and the timing of the completion of the Business Combination. These
forward-looking statements involve significant risks and uncertainties that
could cause the actual results to differ materially from the expected results.
Most of these factors are outside the Company's and HyperloopTT's control and
are difficult to predict. Factors that may cause such differences include, but
are not limited to: (1) the occurrence of any event, change or other
circumstances that could give rise to the termination of the Merger Agreement,
(2) the outcome of any legal proceedings that may be instituted against the
Company and HyperloopTT following the announcement of the Merger Agreement and
the transactions contemplated therein; (3) the inability to complete the
proposed transaction, including due to failure to obtain approval of the
stockholders of the Company, certain regulatory approvals or satisfy other
conditions to closing in the Merger Agreement; (4) the occurrence of any event,
change or other circumstance that could give rise to the termination of the
Merger Agreement or could otherwise cause the transaction to fail to close; (5)
the impact of COVID-19 on HyperloopTT's business and/or the ability of the
parties to complete the Business Combination; (6) the inability to obtain or
maintain the listing of the shares of common stock of the post-acquisition
company on a national securities stock exchange following the Business
Combination; (7) the risk that the Business Combination disrupts current plans
and operations as a result of the announcement and consummation of the Business
Combination; (8) the ability to recognize the anticipated benefits of the
Business Combination, which may be affected by, among other things, competition,
the ability of the combined company to grow and manage growth profitably and
retain its key employees; (9) costs related to the Business Combination; (10)
changes in applicable laws or regulations; (11) the possibility that HyperloopTT
or the combined company may be adversely affected by other political, economic,
business, and/or competitive factors; and (12) other risks and uncertainties
indicated from time to time in the proxy statement/prospectus relating to the
Business Combination, including those under "Risk Factors" therein, and in the
Company's other filings with the
No Offer or Solicitation
This Current Report on Form 8-K shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Business Combination. This Current Report on Form 8-K shall also not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act, or an exemption therefrom.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following exhibit is filed herewith:
Exhibit No. Description of Exhibits 2.1* Agreement and Plan of Merger, dated as ofNovember 21, 2022 , by and among the Company, HyperloopTT, Merger Sub I, and Merger Sub II. 10.1 Sponsor Support Agreement, dated as ofNovember 21, 2022 , by and among the Company, Sponsor and HyperloopTT. 10.2 HyperloopTT Support Agreement, dated as ofNovember 21, 2022 , by and among the Company, HyperloopTT, and certain equityholders of HyperloopTT set forth therein. 99.1 Press Release, datedNovember 22, 2022 . 99.2 Joint Investor Presentation of the Company and HyperloopTT 99.3 HyperloopTT "Imagine" Video Script 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
* Certain exhibits and schedules to this Exhibit have been omitted in accordance
with Item 601(a)(5) of Regulation S-K.
supplementally a copy of any omitted exhibit or schedule to the
request.
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