SPRUCE POWER HOLDING CORPORATION Item 1.01 Entry into a Material Definitive Agreement.
Agreement and Plan of Reorganization
On
XL (commercially known as "XL Fleet") is a leading provider of fleet
electrification solutions for Class 2-6 commercial vehicles in
Pursuant to the Merger Agreement, Merger Sub will merge with and into XL, with XL surviving the merger (the "Merger"). As a result of the Merger, XL will become a wholly-owned subsidiary of Pivotal, with the securityholders of XL becoming securityholders of Pivotal. In connection with the Merger, an aggregate of 100,000,000 shares of Pivotal stock are being issued or reserved for issuance to XL securityholders.
The Merger is expected to be consummated in the fourth quarter of 2020 or first quarter of 2021, after the required approval by the stockholders of Pivotal and the fulfillment of certain other conditions described below.
The following summaries of the Merger Agreement and the other agreements to be entered into by the parties are qualified in their entirety by reference to the text of the Merger Agreement and agreements entered into in connection therewith. The Merger Agreement is attached as Exhibit 2.1 hereto and incorporated herein by reference.
Treatment of
Immediately prior to the effective time of the Merger (the "Effective Time"), XL will cause each share of XL's preferred stock (the "XL Preferred Stock") that is issued and outstanding immediately prior to the Effective Time to be automatically converted into shares of XL's common stock, (the "XL Common Stock" and, together with the XL Preferred Stock, the "XL Stock") in accordance with the terms of XL's amended and restated certificate of incorporation. All of the shares of XL Preferred Stock so converted into shares of XL Common Stock will no longer be issued and outstanding and will cease to exist, and each holder of XL Preferred Stock will thereafter cease to have any rights with respect to such shares of XL Preferred Stock.
At the Effective Time, by virtue of the Merger:
• Each share of XL Common Stock issued and outstanding immediately prior to
the Effective Time (including each share of XL Common Stock issued as a
result of the conversion of XL Preferred Stock described above and any
conversion or exchange of XL's convertible promissory notes (each, a "XL
Convertible Note") described below will be automatically converted into
the right to receive that number of shares of Pivotal's common stock
("Pivotal Common Stock") equal to the Exchange Ratio described below.
• Each outstanding option to purchase shares of XL Common Stock, whether or
not exercisable and whether or not vested, immediately prior to the
Effective Time (each, an "XL Option") will be assumed by Pivotal and
converted into an option to purchase a number of shares of Pivotal Common
Stock equal to the product of (x) the number of shares of XL Common Stock
subject to such XL Option immediately prior to the Effective Time and
(y) the Exchange Ratio, at an exercise price per share (rounded up to the
nearest whole cent) equal to (A) the exercise price per share of such XL
Option immediately prior to the Effective Time divided by (B) the
Exchange Ratio.
• Each warrant, issued by XL and outstanding immediately prior to the
Effective Time, to purchase shares of XL Stock (each, an "XL Warrant")
will be automatically assumed by Pivotal and will become a warrant to
acquire, on the same terms and conditions as were applicable under each
such XL Warrant, a number of shares of Pivotal Common Stock equal to the
product of (x) the number of shares of XL Stock subject to such XL
Warrant immediately prior to the Effective Time as adjusted pursuant to
the terms of such XL Warrant and (y) the Exchange Ratio, at an exercise
price equal to (A) the exercise price of such XL Warrant immediately
prior to the Effective Time as adjusted pursuant to the terms of such XL
Warrant divided by (B) the Exchange Ratio.
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The "Exchange Ratio" is the quotient obtained by dividing (i) 100,000,000 by (i) the sum of (a) the number of issued and outstanding shares of XL Common Stock immediately prior to the Effective Time (including all shares of XL Common Stock issued as a result of the conversion or exchange of XL Preferred Stock and XL Convertible Notes) plus (b) the number of shares of XL Common Stock issuable upon the exercise, conversion or other exchange of XL Convertible Notes, XL Options and XL Warrants which are not converted, exchanged or exercised prior to the Effective Time and are to remain outstanding as of and immediately following the Effective Time plus (c) the number of shares of XL Common Stock issuable upon the exercise, conversion or other exchange of any other debt or equity securities of XL outstanding immediately prior to the Effective Time.
Representations and Warranties
The Merger Agreement contains customary representations and warranties of each of Pivotal, Merger Sub and XL relating, among other things, to their proper organization and qualification and operations.
No Solicitation
The Merger Agreement requires that during the period from the date of the Merger Agreement and continuing until the earlier of the termination of the Merger Agreement pursuant to its terms or the closing of the Merger, (a) XL will not, and will cause its controlled affiliates, employees, agents, officers, directors and representatives not to, directly or indirectly, solicit or enter into discussions or transactions with, or encourage, or provide any information to, any corporation, partnership or other entity or group concerning any merger, sale of ownership interests in XL and/or a material portion of the assets of XL or similar transaction involving XL and (b) each of Pivotal and Merger Sub will not, and will cause its respective controlled affiliates, employees, agents, officers, directors and representatives not to, directly or indirectly, solicit or enter into discussions or transactions with, or encourage, or provide any information to, any corporation, partnership or other entity or group concerning any merger, purchase of ownership interests and/or assets, recapitalization or . . .
Item 3.02 Unregistered Sales of
The information set forth in Item 1.01 relating to the Subscription Agreements is incorporated by reference herein.
Item 7.01 Regulation FD Disclosure.
On
Attached as Exhibit 99.2 to this Current Report on Form 8-K is the investor presentation that will be used by Pivotal with respect to the Merger. Also attached as Exhibit 99.3 to this Current Report on Form 8-K is an investor call script that will be used to discuss the proposed Merger.
The information set forth under this Item 7.01, including Exhibits 99.1, 99.2 and 99.3, is intended to be furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended ("Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such filing.
Important Additional Information and Where to Find It
IN CONNECTION WITH THE PROPOSED MERGER, PIVOTAL INTENDS TO FILE WITH THE SEC THE
REGISTRATION STATEMENT ON FORM S-4, WHICH WILL INCLUDE A PROXY
STATEMENT/PROSPECTUS, AND CERTAIN OTHER RELATED DOCUMENTS, WHICH WILL BE BOTH
THE PROXY STATEMENT TO BE DISTRIBUTED TO PIVOTAL'S STOCKHOLDERS IN CONNECTION
WITH PIVOTAL'S SOLICITATION OF PROXIES FOR THE VOTE BY PIVOTAL'S STOCKHOLDERS
WITH RESPECT TO THE MERGER AND CERTAIN OF THE TRANSACTIONS CONTEMPLATED BY THE
MERGER AGREEMENT, AS WELL AS OTHER MATTERS THAT MAY BE DESCRIBED IN THE
REGISTRATION STATEMENT, AS WELL AS THE PROSPECTUS RELATING TO THE OFFER AND SALE
OF THE SECURITIES OF PIVOTAL COMMON STOCK TO BE ISSUED IN THE MERGER. INVESTORS
AND SECURITY HOLDERS OF PIVOTAL AND XL ARE URGED TO READ THE PROXY
STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS THAT WILL BE FILED WITH THE
SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTIONS. INVESTORS AND
SECURITY HOLDERS WILL BE ABLE TO OBTAIN FREE COPIES OF THE PROXY
STATEMENT/PROSPECTUS AND OTHER DOCUMENTS CONTAINING IMPORTANT INFORMATION ABOUT
PIVOTAL AND XL ONCE SUCH DOCUMENTS ARE FILED WITH THE
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THE SEC BY PIVOTAL WHEN AND IF AVAILABLE, CAN BE OBTAINED FREE OF CHARGE ON
PIVOTAL'S WEBSITE AT WWW.PIVOTALAC.COM OR BY DIRECTING A WRITTEN REQUEST TO
PIVOTAL INVESTMENT CORPORATION II, C/O GRAUBARD MILLER, 405 LEXINGTON AVENUE,
11TH FLOOR,
THIS CURRENT REPORT AND THE EXHIBITS HERETO ARE NOT A PROXY STATEMENT OR SOLICITATION OF A PROXY, CONSENT OR AUTHORIZATION WITH RESPECT TO ANY SECURITIES OR IN RESPECT OF THE PROPOSED TRANSACTIONS AND SHALL NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES OF PIVOTAL OR XL, 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.
Participants in the Solicitation
PIVOTAL AND XL AND THEIR RESPECTIVE DIRECTORS AND EXECUTIVE OFFICERS, UNDER SEC
RULES, MAY BE DEEMED TO BE PARTICIPANTS IN THE SOLICITATION OF PROXIES OF
PIVOTAL'S STOCKHOLDERS IN CONNECTION WITH THE PROPOSED TRANSACTIONS. INVESTORS
AND SECURITY HOLDERS MAY OBTAIN MORE DETAILED INFORMATION REGARDING THE NAMES
AND INTERESTS IN THE PROPOSED TRANSACTIONS OF PIVOTAL'S DIRECTORS AND OFFICERS
IN PIVOTAL'S FILINGS WITH THE
SOME OF XL'S FINANCIAL INFORMATION AND DATA CONTAINED IN THE EXHIBITS HERETO
DOES NOT CONFORM TO SEC REGULATION S-X IN THAT IT INCLUDES CERTAIN FINANCIAL
INFORMATION NOT DERIVED IN ACCORDANCE WITH
THE FINANCIAL PROJECTIONS INCLUDED IN THE EXHIBITS HERETO ARE FORWARD-LOOKING STATEMENTS THAT ARE BASED ON ASSUMPTIONS THAT ARE INHERENTLY SUBJECT TO SIGNIFICANT UNCERTAINTIES AND CONTINGENCIES, MANY OF WHICH ARE BEYOND PIVOTAL'S AND XL'S CONTROL. WHILE ALL PROJECTIONS ARE NECESSARILY SPECULATIVE, PIVOTAL AND XL BELIEVE THAT THE PROSPECTIVE FINANCIAL INFORMATION COVERING PERIODS BEYOND TWELVE MONTHS FROM ITS DATE OF PREPARATION CARRIES INCREASINGLY HIGHER LEVELS OF UNCERTAINTY AND SHOULD BE READ IN THAT CONTEXT. THERE WILL BE DIFFERENCES BETWEEN ACTUAL AND PROJECTED RESULTS, AND ACTUAL RESULTS MAY BE MATERIALLY GREATER OR MATERIALLY LESS THAN THOSE CONTAINED IN THE PROJECTIONS. THE INCLUSION OF PROJECTIONS IN THIS REPORT AND THE EXHIBITS HERETO SHOULD NOT BE REGARDED AS AN INDICATION THAT PIVOTAL AND XL, OR THEIR REPRESENTATIVES, CONSIDERED OR CONSIDER THE PROJECTIONS TO BE A RELIABLE PREDICTION OF FUTURE EVENTS.
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Forward-Looking Statements
THIS CURRENT REPORT AND THE EXHIBITS HERETO INCLUDE "FORWARD-LOOKING STATEMENTS". ACTUAL RESULTS MAY DIFFER FROM 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.
IN ADDITION TO FACTORS PREVIOUSLY DISCLOSED IN PIVOTAL'S REPORTS FILED WITH THE SEC AND THOSE IDENTIFIED ELSEWHERE IN THIS COMMUNICATION, THE FOLLOWING FACTORS, AMONG OTHERS, COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM FORWARD-LOOKING STATEMENTS OR HISTORICAL PERFORMANCE: ABILITY OF THE PARTIES TO SATISFY THE CLOSING CONDITIONS TO THE MERGER, INCLUDING APPROVAL BY STOCKHOLDERS OF PIVOTAL AND XL ON THE EXPECTED TERMS AND SCHEDULE AND THE RISK THAT ANY THIRD-PARTY APPROVALS OR CONSENTS REQUIRED FOR THE MERGER ARE NOT OBTAINED OR ARE OBTAINED SUBJECT TO CONDITIONS THAT ARE NOT ANTICIPATED; DELAY IN CLOSING THE MERGER; FAILURE TO REALIZE THE BENEFITS EXPECTED FROM THE PROPOSED MERGER; THE EFFECTS OF PENDING AND FUTURE LEGISLATION; RISKS RELATED TO DISRUPTION OF MANAGEMENT TIME FROM ONGOING BUSINESS OPERATIONS DUE TO THE PROPOSED MERGER; BUSINESS DISRUPTION FOLLOWING THE MERGER; RISKS RELATED TO XL'S BUSINESS, INCLUDING THE HIGHLY COMPETITIVE NATURE OF ITS INDUSTRY; LITIGATION, COMPLAINTS, PRODUCT LIABILITY CLAIMS AND/OR ADVERSE PUBLICITY; COST INCREASES OR SHORTAGES IN COMPONENTS NECESSARY FOR XL'S PRODUCTS AND SERVICES; PRIVACY AND DATA PROTECTION LAWS, PRIVACY OR DATA BREACHES, OR THE LOSS OF DATA; THE IMPACT OF THE COVID-19 PANDEMIC ON XL'S BUSINESS; AND MACROECONOMIC FACTORS BEYOND PIVOTAL'S OR XL'S CONTROL.
NEITHER PIVOTAL NOR XL UNDERTAKE ANY OBLIGATION TO UPDATE OR REVISE ANY FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE, EXCEPT AS REQUIRED BY LAW. IMPORTANT FACTORS, AMONG OTHERS, THAT MAY AFFECT ACTUAL RESULTS INCLUDE XL'S ABILITY TO EXECUTE ON ITS BUSINESS PLANS AND XL'S ESTIMATES OF EXPENSES AND FUTURE REVENUES AND PROFITABILITY. OTHER FACTORS INCLUDE THE POSSIBILITY THAT THE PROPOSED TRANSACTIONS DO NOT CLOSE, INCLUDING DUE TO THE FAILURE TO RECEIVE REQUIRED SECURITY HOLDER APPROVALS, OR THE FAILURE OF OTHER CLOSING CONDITIONS.
ADDITIONAL INFORMATION CONCERNING THESE AND OTHER RISK FACTORS WILL BE CONTAINED
IN THE REGISTRATION STATEMENT ON FORM S-4 AND PIVOTAL'S OTHER FILINGS WITH THE
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits: Exhibit Description 2.1* Agreement and Plan of Reorganization, dated as ofSeptember 17, 2020 , by and amongPivotal Investment Corporation II ,PIC II Merger Sub Corp. , andXL Hybrids, Inc. 10.1 Form of Subscription Agreement 10.2 Form of Support Agreement 99.1 Press release datedSeptember 18, 2020 99.2 Investor Presentation 99.3 Investor Call Script * Certain exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(b)(2). Pivotal agrees to furnish supplementally a copy of all omitted exhibits and schedules to theSecurities and Exchange Commission upon its request.
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