Hyperloop Transportation Technologies Inc. entered into a definitive merger agreement to acquire Forest Road Acquisition Corp. II (NYSE:FRXB) from Forest Road Acquisition Sponsor II LLC and others for $600 million on November 21, 2022. In connection with the Mergers, all outstanding shares of HyperloopTT 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 and 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 Forest Road common stock. The transaction ascribes to HyperloopTT a pre-money equity value of approximately $600 million, including outstanding options and warrants. Existing HyperloopTT shareholders and convertible note holders will roll 100% of their interests in the transaction and the combined company will assume the outstanding HyperloopTT options and warrants, which will remain outstanding to the extent not otherwise exercised prior to closing. Approximately $289 million of common stock will be issued at closing to the HyperloopTT shareholders and convertible note holders. Assuming no redemptions, the transaction is expected to deliver up to $330 million in net proceeds to the combined company at close. On fully diluted basis, existing HyperloopTT shareholders will own 27.9% stake, HyperloopTT options/warrant holders will own 30% and Forest Road shareholders will own 42.1% stake of combined company. Upon the closing of the transaction, the newly combined company will be named “Hyperloop Transportation Technologies'' and will continue to be led by Chief Executive Officer Andrés de León and the HyperloopTT management team.

The transaction is subject to customary closing conditions, including the approval of the stockholders of Forest Road and HyperloopTT, effectiveness of the registration statement on Form S-4 to be filed by Acquiror in connection with the Business Combination, expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, receipt of approval for listing on the New York Stock Exchange, Nasdaq Global Select Market or the Nasdaq Global Market. Other conditions to HyperloopTT's and Forest Road's obligations to consummate the Business Combination include, among others, that there will be Available Cash equal to no less than $40,000,000. The Boards of Directors of HyperloopTT and Forest Road have each unanimously approved this transaction. The transaction is expected to close in the first half of 2023. Paul Hastings LLP is serving as legal advisor to HyperloopTT. Tamar Donikyan and Michael P. Considine, P.C. of Kirkland & Ellis LLP is serving as legal advisor to Forest Road.

Hyperloop Transportation Technologies Inc. cancelled the acquisition of Forest Road Acquisition Corp. II (NYSE:FRXB) from Forest Road Acquisition Sponsor II LLC and others on February 3, 2023.