NEBULA ACQUISITION CORPORATION Item 1.01. Entry into a Material Definitive Agreement
General
On
The Merger Agreement
Structure of the Transaction
The acquisition is structured as a "double dummy" transaction, resulting in the following:
(a) Each of
entities that were formed for the sole purpose of entering into and
consummating the transactions set forth in the Agreement. ParentCo is a
wholly-owned direct subsidiary of NAC and both Merger Sub LLC and Merger Sub
Corp are wholly-owned direct subsidiaries of ParentCo.
(b) On the Closing Date, each of the following transactions will occur in the
following order: (i) Merger Sub Corp will merge with and into NAC (the "First
Merger"), with NAC surviving the First Merger as a wholly owned subsidiary of
ParentCo (the "NAC Surviving Company "); (ii) immediately following the First
Merger and prior to the Blocker Contribution (as defined below), Blocker
shall redeem a specified number of shares of Blocker common stock in exchange
for cash (the "Blocker Redemption"); (iii) immediately following the Blocker
Redemption, ParentCo will acquire, and the Blocker Holder will contribute to
ParentCo the remaining shares of Blocker common stock after giving effect to
the Blocker Redemption (the "Blocker Contribution") such that, following the
Blocker Contribution, Blocker will be a wholly-owned subsidiary of the
ParentCo; (iv) immediately following the Blocker Contribution, Merger Sub LLC
will merge with and into the Company (the "Second Merger"), with the Company
surviving the Second Merger as a wholly-owned subsidiary of ParentCo (the
"Surviving Company"); (v) immediately following the Second Merger, Blocker
will acquire, and ParentCo will contribute to Blocker all common units of the
Surviving Company directly held by ParentCo after the Second Merger; and (vi)
the NAC Surviving Company will acquire and ParentCo will contribute to the
NAC Surviving Company the remaining shares of Blocker common stock after
giving effect to the Blocker Redemption and the Blocker Contribution (the
"ParentCo Blocker Contribution") such that, following the ParentCo Blocker
Contribution, Blocker shall be a wholly-owned subsidiary of the NAC Surviving
Company (together with the other transactions related thereto, the "Proposed
Transactions").
(c) Contemporaneously with the execution of the Agreement,
several fundamental investors entered into certain subscription agreements
(collectively, the "Subscription Agreements"), pursuant to which, at Closing,
True Wind Capital and such other persons agreed to subscribe for and purchase
ParentCo Common Shares for an aggregate cash amount of $200,000,000 at a
purchase price of $10.00 per share, anchored by True Wind Capital , which has
agreed to subscribe to and purchase $85,000,000 worth of NAC Class A Common
Stock.
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(d) In addition, contemporaneously with the execution of the Agreement, (i)
certain Company Unitholders representing 48% of the Company's outstanding
membership interests entered into a Company Support Agreement (the "Company
Support Agreement"), pursuant to which such Company Unitholders agreed, among
other things, to approve the Agreement and the Proposed Transactions, (ii)
certain stockholders of NAC entered into Investor Support Agreements (each,
an "Investor Support Agreement"), pursuant to which certain NAC stockholders
agreed, among other things, to approve the Agreement, the Proposed
Transactions, not to redeem any shares held by such stockholders in
connection with the Proposed Transactions and to tender any warrants to
purchase NAC Class A Common Stock held by such stockholder to NAC for cash
consideration of $1.50 per whole warrant and to vote all such warrants held
by such NAC stockholder in favor of any amendment to the terms of such
warrants proposed by NAC, including to reduce the term of all outstanding
warrants to purchase shares of NAC Class A Common Stock to expire upon the
consummation of the First Merger (the "Warrant Amendment"); and (iii) the
holders of the NAC Class B Common Stock entered into a Founder Support
Agreement (the "Founder Support Agreement"), pursuant to which, among other
things, such holders agreed to approve the Agreement, the Proposed
Transactions and forfeit any NAC Warrants held by them to NAC, as well as
waive any anti-dilution rights provided to such NAC stockholder in NAC's
current certificate of incorporation.
(e) The parties will also enter into a Tax Receivable Agreement (the "Tax
Receivable Agreement") and an Investors Rights Agreement (the "Investor
Rights Agreement"), each of which are closing conditions of the parties to
consummate the Proposed Transactions.
Consideration
The aggregate consideration payable to the members of the Company and the Blocker Holder for the Proposed Transaction consists of the Company Merger Consideration, the Blocker Redemption Amount, the Blocker Consideration and the Contingency Consideration.
(a) The Cash Consideration and the Share Consideration
The Cash Consideration is an amount equal to (i) the Available Cash (as defined
below), plus (ii) the aggregate amount of all cash held by the Company or any of
its subsidiaries as of
The Share Consideration is the number of ParentCo Common Shares equal to the
quotient of: (i) (1)
Item 3.02. Unregistered Sales of
The disclosure set forth above in Item 1.01 of this Current Report on Form 8-K is incorporated by reference herein. The securities of NAC that may be issued in connection with the Agreement and the Subscription Agreements will be registered under the Securities Act in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.
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Item 7.01. Regulation FD Disclosure.
On
Attached as Exhibit 99.2 to this Current Report on Form 8-K and incorporated herein by reference is the form of presentation to be used by NAC in presentations for certain of NAC's stockholders and other persons. Additionally, attached as Exhibit 99.3 to this Current Report on Form 8-K and incorporated herein by reference is a supplemental presentation providing additional information relating to the Proposed Transaction to be used by NAC in presentations for certain of NAC's stockholders and other persons. Such exhibits and the information set forth therein shall not be deemed to be filed for purposes of Section 18 of the Exchange Act, or otherwise be subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act or the Exchange Act.
Additional Information
In connection with the Proposed Transaction, NAC intends to file with the
Participants in the Solicitation
NAC, the Company and their respective directors and executive officers may be
considered participants in the solicitation of proxies with respect to the
Proposed Transaction under the rules of the
Non-Solicitation
This Current Report on Form 8-K is not a proxy statement or solicitation of a proxy, consent or authorization with respect to any securities or in respect of the potential transaction and shall not constitute an offer to sell or a solicitation of an offer to buy the securities of NAC or the Company, nor shall there be any sale of any such 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 such state or jurisdiction. No offer of securities shall be made except by means of a definitive prospectus meeting the requirements of the Securities Act.
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Forward-Looking Statements
This Current Report on Form 8-K includes certain statements that are not
historical facts but are forward-looking statements for purposes of the safe
harbor provisions under the United States Private Securities Litigation Reform
Act of 1995. Forward-looking statements generally are accompanied by words such
as "believe," "may," "will," "estimate," "continue," "anticipate," "intend,"
"expect," "should," "would," "plan," "predict," "potential," "seem," "seek,"
"future," "outlook," and similar expressions that predict or indicate future
events or trends or that are not statements of historical matters. These
forward-looking statements include, but are not limited to, statements regarding
2020 EBITDA and EBITDA margin projections, estimates and forecasts of revenue
and other financial and performance metrics and projections of market
opportunity and expectations, NAC's ability to enter into definitive agreements
or consummate a transaction with the Company and NAC's ability to obtain the
financing necessary consummate the potential transaction. These statements are
based on various assumptions and on the current expectations of NAC's and the
Company's management and are not predictions of actual performance. These
forward-looking statements are provided for illustrative purposes only and are
not intended to serve as, and must not be relied on by any 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. Many actual events and circumstances
are beyond the control of NAC and the Company. These forward looking statements
are subject to a number of risks and uncertainties, including general economic,
political and business conditions, applicable taxes, inflation, interest rates
and the regulatory environment, the outcome of judicial proceedings to which the
Company is, or may become a party, the inability of the parties to enter into
definitive agreements or consummate the Proposed Transaction; the risk that the
approval of the stockholders of NAC for the potential transaction is not
obtained; failure to realize the anticipated benefits of the Potential
Transaction, including as a result of a delay in consummating the Potential
Transaction or difficulty in integrating the businesses of NAC and the Company;
the amount of redemption requests made by NAC's stockholders; those factors
discussed in NAC's Annual Report on Form 10-K for the fiscal year ended
Non-GAAP Financial Measure and Related Information
This Current Report on Form 8-K references EBITDA and EBITDA margin, which are
financial measures that are not prepared in accordance with
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Exhibit 2.1 Business Combination Agreement, dated as ofJanuary 5, 2020 , by and among NAC, Blocker, Blocker Holder, ParentCo,Merger Sub LLC ,Merger Sub Corp , the Company, andShareholder Representative Services LLC , as the Securityholder Representative. 10.1 Founder Support Agreement, dated as ofJanuary 5, 2020 , by and among NAC, ParentCo, the Company, the Sponsor,Adam H. Clammer , James H. Greene, Jr.,Rufina Adams ,David Kerko ,Frank Kern ,James C. Hale andRonald Lamb . 10.2 Form of Investor Support Agreement. 10.3 Company Support Agreement, dated as ofJanuary 5, 2020 , by and among NAC,Bregal Investments, Inc. , BRP Hold 11, Inc.,Bee Cave Capital, LLC ,Richard Watkins ,Open Lending Opportunity Partners ,Ryan Collins ,Kurt Wilkin ,Scott Gordon ,Keith Jezek andSteve Letbetter . 10.4 Form of Subscription Agreement. 99.1 Press Release, datedJanuary 6, 2020 . 99.2 Form of Investor Presentation. 99.3 Form of Supplemental Investor Presentation. 14
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