Item 1.01 Entry into a Material Definitive Agreement.
Merger Agreement
FirstMark Horizon Acquisition Corp. ("FirstMark") is a blank check company
incorporated in Delaware and formed for the purpose of effecting a merger,
capital stock exchange, asset acquisition, stock purchase, reorganization or
similar business combination with one or more businesses. On October 6, 2021,
FirstMark entered into an Agreement and Plan of Merger (the "Merger Agreement")
with Sirius Merger Sub, Inc., a Delaware corporation and a wholly owned direct
subsidiary of FirstMark ("Merger Sub"), Starry, Inc., a Delaware corporation
("Starry"), and Starry Holdings, Inc., a Delaware corporation and wholly owned
direct subsidiary of Starry ("Holdings"). Pursuant to the Merger Agreement, and
subject to the terms and conditions contained therein, the business combination
will be effected in two steps: (a) FirstMark will merge with and into Holdings
(the "SPAC Merger" and, the closing of the SPAC Merger, the "SPAC Merger
Closing," and, the time at which the SPAC Merger becomes effective, the "SPAC
Merger Effective Time"), with Holdings surviving the SPAC Merger as a publicly
traded entity (such surviving entity, "New Starry") and becoming the sole owner
of Merger Sub; and (b) at least twenty-four (24) hours, but no more than
forty-eight (48) hours, after the SPAC Merger Effective Time, Merger Sub will
merge with and into Starry (the "Acquisition Merger" and, together with the SPAC
Merger and all other transactions contemplated by the Merger Agreement, the
"Business Combination"), with Starry surviving the Acquisition Merger as a
wholly owned subsidiary of New Starry. New Starry will have a dual-class share
structure with super voting rights for Starry's co-founder and Chief Executive
Officer, Chaitanya Kanojia.
The Business Combination
The Merger Agreement provides that, among other things and upon the terms and
subject to the conditions thereof, the following transactions will occur:
(i) at the SPAC Merger Effective Time, (a) each unit of FirstMark, each
consisting of one share of Class A common stock, par value $0.0001 per share, of
FirstMark ("FirstMark Class A Common Stock") and one-third of one warrant of
FirstMark (the "FirstMark Warrants"), will be automatically detached and the
holder thereof deemed to hold one share of FirstMark Class A Common Stock and
one-third of one FirstMark Warrant; (b) immediately following the preceding
step, each share of FirstMark Class A Common Stock will be canceled and
converted into a number of shares of Class A common stock, par value $0.0001 of
New Starry ("New Starry Class A Common Stock"), equal to the lower of: (A)
1.2415; and (B) (1) (x) the Post-Redemption SPAC Share Number (as defined in the
Merger Agreement), plus (y) 1,000,000 divided by (2) the Post-Redemption SPAC
Share Number (the lower of (A) and (B), the "Class A Exchange Ratio"); (c) each
FirstMark Warrant will be assumed by New Starry and converted automatically into
a warrant to purchase a number of shares of New Starry Class A Common Stock
calculated in accordance with the Class A Exchange Ratio; and (d) each share of
Holdings common stock, par value $0.01 per share, shall be redeemed from Starry
for par value;
(ii) immediately prior to the effective time of the Acquisition Merger (the
"Acquisition Merger Effective Time"), (a) each share of the Series Seed
Preferred Stock, par value $0.001 per share, Series A Preferred Stock, par value
$0.001 per share, Series B Preferred Stock, par value $0.001 per share, Series C
Preferred Stock, par value $0.001 per share, Series D Preferred Stock, par value
$0.001 per share, Series E Preferred Stock, par value $0.001 per share, Series
E-1 Preferred Stock, par value $0.001 per share, Series E-2 Preferred Stock, par
value $0.001 per share and Series E-3 Preferred Stock, par value $0.001 per
share, of Starry will convert into a number of shares of common stock, par value
$0.001 per share, of Starry ("Starry Common Stock") as set forth in the Merger
Agreement (such conversion, the "Starry Preferred Stock Conversion") and (b)
each outstanding warrant of Starry (the "Starry Warrants") will automatically be
exercised in exchange for shares of Starry Common Stock pursuant to the terms of
such Starry Warrants and shall be automatically cancelled, extinguished and
retired and cease to exist; and
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(iii) at the Acquisition Merger Effective Time, (a) each share of Starry Common
Stock, including shares of Starry Common Stock resulting from the Starry
Preferred Stock Conversion, will be canceled and automatically converted into
the right to receive (i) with respect to Chaitanya Kanojia, the number of shares
of Class X common stock, par value $0.0001 per share, of New Starry (together
with the New Starry Class A Common Stock, the "New Starry Common Stock") equal
to the quotient of 140,000,000, divided by the Fully Diluted Share Number (as
defined in the Merger Agreement) (the "Acquisition Merger Exchange Ratio") and
(ii) with respect to any other persons who hold Starry Common Stock immediately
prior to the Acquisition Merger Effective Time (including after giving effect to
the Starry Preferred Stock Conversion), the number of shares of New Starry Class
A Common Stock equal to the Acquisition Merger Exchange Ratio; (b) each share of
the Series Z Preferred Stock, par value $0.001 per share, of Starry (the "Starry
Series Z Preferred Stock") will convert on a 1-for-1 basis into shares of New
Starry Class A Common Stock; (c) each outstanding option of Starry (a "Starry
Option") will be converted into an option exercisable for that number of shares
of New Starry Class A Common Stock calculated based on the Acquisition Merger
Exchange Ratio, on the same terms and conditions as were applicable to such
Starry Option; and (d) each outstanding award of restricted stock units of
Starry will be converted into an award covering that number of shares of New
Starry Class A Common Stock calculated based on the Acquisition Merger Exchange
Ratio. The closing of the Acquisition Merger is referred to herein as the
"Acquisition Merger Closing."
The holders of FirstMark Class A Common Stock that do not elect to redeem their
shares in connection with the Business Combination, will share in a pool of one
million additional shares of New Starry Class A Common Stock, based on the Class
A Exchange Ratio of between 1.0242 and 1.2415 depending on the number of
unredeemed shares. Assuming a price of $10.00 per share of FirstMark Class A
Common Stock at the SPAC Merger Closing, each share of FirstMark Class A Common
Stock would receive shares of New Starry Class A Common Stock with a value
ranging between $10.24 (assuming no redemptions by the stockholders of FirstMark
(the "FirstMark Stockholders")) and $12.42 (assuming redemptions resulting in
the maximum Class A Exchange Ratio).
The boards of directors of FirstMark and Starry have each unanimously (i)
approved and declared advisable the Merger Agreement, the Business Combination
and the other transactions contemplated thereby and (ii) resolved to recommend
approval (in the case of the FirstMark Stockholders) and adoption (in the case
of the stockholders of Starry (the "Starry Stockholders")) of the Merger
. . .
Item 3.02 Unregistered Sales of Equity Securities
The disclosure set forth above in Item 1.01 of this Current Report on Form 8-K
with respect to the PIPE Investment, and the Convertible Note Investment is
incorporated by reference in this Item 3.02. The PIPE Subscribed Shares to be
issued in connection with the PIPE Investment will not be registered under the
Securities Act, and will be issued in reliance on the exemption from
registration requirements thereof provided by Section 4(a)(2) of the Securities
Act.
Item 7.01 Regulation FD Disclosure.
On October 7, 2021, FirstMark and Starry issued a joint press release (the
"Press Release") announcing the execution of the Merger Agreement. The Press
Release is attached hereto as Exhibit 99.1 and incorporated by reference herein.
Attached as Exhibit 99.2 and incorporated herein by reference is the investor
presentation first made available on October 7, 2021, for use by FirstMark in
meetings with certain of its stockholders as well as other persons with respect
to FirstMark's proposed transaction with Starry, as described in this Current
Report on Form 8-K.
Attached as Exhibit 99.3 and incorporated herein by reference is the transcript
from a recording first made available on October 7, 2021, in which executives
from FirstMark and Starry discuss the Business Combination.
The information in this Item 7.01, including Exhibit 99.1, Exhibit 99.2 and
Exhibit 99.3 is 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 liabilities under that section, and shall not be
deemed to be incorporated by reference into the filings of FirstMark under the
Securities Act or the Exchange Act, regardless of any general incorporation
language in such filings. This Current Report on Form 8-K will not be deemed an
admission as to the materiality of any information contained in this Item 7.01,
including Exhibit 99.1, Exhibit 99.2 and Exhibit 99.3.
Additional Information about the Business Combination and Where to Find It.
In connection with the Business Combination, Holdings will file the Registration
Statement with the SEC. The Registration Statement will include a proxy
statement of FirstMark and a prospectus of Holdings, referred to as a proxy
statement/prospectus. The proxy statement/prospectus will be sent to all
FirstMark Stockholders. Additionally, Holdings and FirstMark will file other
relevant materials with the SEC in connection with the Business Combination.
Copies of the Registration Statement, the proxy statement/prospectus and all
other relevant materials filed or that will be filed with the SEC may be
obtained free of charge at the SEC's website at www.sec.gov. Before making any
voting or investment decision, investors and security holders of FirstMark are
urged to read the Registration Statement, the proxy statement/prospectus and all
other relevant materials filed or that will be filed with the SEC in connection
with the Business Combination because they will contain important information
about the Business Combination and the parties to the Business Combination.
The documents filed by FirstMark with the SEC also may be obtained free of
charge at FirstMark's website at www.firstmarkhorizon.com or upon written
request to 100 5th Ave, 3rd Floor New York, NY 10011.
Participants in Solicitation
FirstMark, Holdings and Starry and their respective directors and executive
officers, under SEC rules, may be deemed to be participants in the solicitation
of proxies of FirstMark Stockholders in connection with the Business
Combination. Investors and security holders may obtain more detailed information
regarding the names and interests in the Business Combination of FirstMark's
directors and officers in FirstMark's filings with the SEC, including
FirstMark's registration statement on Form S-1, which was originally filed with
the SEC on September 18, 2020. To the extent that holdings of FirstMark's
securities have changed from the amounts reported in FirstMark's registration
statement on Form S-1, such changes have been or will be reflected on Statements
of Change in Ownership on Form 4 filed with the SEC. Information regarding the
persons who may, under SEC rules, be deemed participants in the solicitation of
proxies to FirstMark Stockholders in connection with the Business Combination
will be included in the proxy statement/prospectus relating to the Business
Combination when it becomes available. You may obtain free copies of these
documents as described in the preceding paragraph.
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No Offer or Solicitation
This Current Report on Form 8-K shall not constitute a proxy statement or
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 a solicitation of an offer to buy any
securities of FirstMark, Holdings or Starry, nor shall there be any sale of
securities in any state or jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of any such state or jurisdiction. No offering of securities
shall be made except by means of a prospectus meeting the requirements of
Section 10 of the Securities Act.
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 with respect to the Business Combination between FirstMark
and Starry. Words such as "expect," "estimate," "project," "budget," "forecast,"
"anticipate," "intend," "plan," "may," "will," "could," "should," "believe,"
"predict," "potential," "continue," "strategy," "future," "opportunity,"
"would," "seem," "seek," "outlook" and similar expressions are intended to
identify such forward-looking statements. Forward-looking statements are
predictions, projections and other statements about future events that are based
on current expectations and assumptions and, as a result, are subject to risks
and uncertainties that could cause the actual results to differ materially from
the expected results. These statements are based on various assumptions, whether
or not identified in this Current Report on Form 8-K. These forward-looking
statements are provided for illustrative purposes only and are not intended to
serve as, and must not be relied on by an 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. These forward-looking statements include, without limitation,
Starry's and FirstMark's expectations with respect to anticipated financial
impacts of the Business Combination, the satisfaction of closing conditions to
the Business Combination, and the timing of the completion of the Business
Combination. You should carefully consider the risks and uncertainties described
in the "Risk Factors" section of FirstMark's registration statement on Form S-1
(File No. 333-248916), its Annual Report on Form 10-K, as amended from time to
time, for the fiscal year ended December 31, 2020 and its subsequent Quarterly
Reports on Form 10-Q. In addition, there will be risks and uncertainties
described in the Form S-4 and other documents filed by FirstMark or Holdings
from time to time with the SEC. These filings would identify and address other
important risks and uncertainties that could cause actual events and results to
differ materially from those contained in the forward-looking statements. Most
of these factors are outside Starry's, Holdings' and FirstMark's control and are
difficult to predict. Many factors could cause actual future events to differ
from the forward-looking statements in this Current Report on Form 8-K,
including but not limited to: (1) the outcome of any legal proceedings that may
be instituted against FirstMark, Starry or Holdings following the announcement
of the Business Combination; (2) the inability to complete the Business
Combination, including due to the inability to concurrently close the Business
Combination and the private placement of common stock or due to failure to
obtain approval of the FirstMark Stockholders; (3) the risk that the transaction
may not be completed by FirstMark's business combination deadline and the
potential failure to obtain an extension of the Business Combination deadline if
sought by FirstMark; (4) the failure to satisfy the conditions to the
consummation of the transaction, including the approval by the FirstMark
Stockholders, the satisfaction of the minimum trust account amount following any
redemptions by FirstMark's public stockholders and the receipt of certain
governmental and regulatory approvals; (5) delays in obtaining, adverse
conditions contained in, or the inability to obtain necessary regulatory
approvals or complete regulatory reviews required to complete the Business
Combination; (6) the occurrence of any event, change or other circumstance that
could give rise to the termination of the Merger Agreement; (7) volatility in
the price of FirstMark's, Starry's or Holdings' securities; (8) the risk that
the Business Combination disrupts current plans and operations as a result of
the announcement and consummation of the Business Combination; (9) the inability
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, maintain relationships with
customers and suppliers and retain key employees; (10) costs related to the
Business Combination; (11) changes in the applicable laws or regulations; (12)
the possibility that the combined company may be adversely affected by other
economic, business, and/or competitive factors; (13) the risk of downturns and a
changing regulatory landscape in the highly competitive industry in which Starry
operates; (14) the impact of the global COVID-19 pandemic; (15) Starry's ability
to obtain or maintain rights to use licensed spectrum in any market in which
Starry operates and potential declines in the value of Starry's FCC licenses;
(16) the potential inability of Starry to raise additional capital needed to
pursue its business objectives or to achieve efficiencies regarding other costs;
(17) the enforceability of Starry's intellectual property, including its
patents, and the potential infringement on the intellectual property rights of
others, cyber security risks or potential breaches of data security; and (18)
other risks and uncertainties described in FirstMark's registration statement on
Form S-1 and Annual Report on Form 10-K, as amended from time to time, for the
fiscal year ended December 31, 2020 and its subsequent Quarterly Reports on Form
10-Q. These risks and uncertainties may be amplified by the COVID-19 pandemic,
which has caused significant economic uncertainty. Starry, Holdings and
FirstMark caution that the foregoing list of factors is not exclusive or
. . .
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
2.1 Agreement and Plan of Merger, dated as of October 6, 2021
10.1 Form of PIPE Subscription Agreement
10.2 Form of Series Z Subscription Agreement
10.3 Form of Convertible Note Subscription Agreement
10.4 Sponsor Support Agreement, dated as of October 6, 2021
10.5 Form of Starry Holders Support Agreement
99.1 Joint Press Release, dated as of October 7, 2021
99.2 Investor Presentation, dated as of October 7, 2021
99.3 Transcript of Recorded Investor Presentation, dated as of October 7,
2021
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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