STRATIM CLOUD ACQUISITION CORP. Item 1.01 Entry into a Material Agreement
The Membership Interests Purchase Agreement
On
The Recapitalization
Immediately prior to the Closing, Force will effectuate a recapitalization (the "Recapitalization"), pursuant to which, among other things, all outstanding membership interests of Force will be converted or exchanged into common units ("Common Units").
The Transaction and Consideration
Immediately prior to the Closing:
(i) Force will adopt a Second Amended and Restated LLC Agreement (the "
Agreement") to, among other things, (i) permit the issuance and ownership of
the post-Recapitalization equity of Force as contemplated by the Purchase
Agreement and (ii) to admit the Company as the sole managing member of Force;
and
(ii) The Company will file with the Secretary of
restated certificate of incorporation (the "A&R Charter") to, among other
things, approve the issuance of shares Class C Common Stock of the Company
("Company Class C Common Stock"), which will, among other matters, carry
such non-economic and voting rights as set forth in the A&R Charter.
Pursuant to the Purchase Agreement, the Company will purchase an aggregate of up
to 12,000,000 Common Units from Force Members for
Pursuant to the Purchase Agreement, the Company will subscribe for a number of
Common Units equal to the total shares of Class B Common Stock of the Company
issued and outstanding immediately prior to the Transaction, in exchange for the
number of shares of Company Class
Earn-Out
Following the Closing, and as additional consideration for the Transaction,
within five (5) Business Days after the determination of the 2023 EBITDA (as
defined in the Purchase Agreement), Force and the Company (as applicable) shall
issue or cause to be issued to each Force Member the following number of Common
Units and shares of Company Class
Notwithstanding the foregoing, the Company shall be permitted to satisfy its
obligation to deliver Earnout Equity pursuant to the Minimum EBITDA Target by:
(i) delivering
Representations and Warranties; Covenants
The Purchase Agreement contains customary representations and warranties by the Company, Force and Force Members. The representations and warranties of the respective parties to the Purchase Agreement generally will not survive the Closing. In addition, the Company has agreed to adopt an equity incentive plan prior to the Closing Date, as described in the Purchase Agreement.
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Conditions to Closing
The Closing is subject to the satisfaction or waiver of certain customary
closing conditions, including, among other things, (i) approval of the
Transaction and related agreements and transactions by the Company's
stockholders, (ii) the HSR waiting period shall have expired or been terminated;
(iii) the absence of any legal restraints on the Closing, (iv) the shares of
Company Common Stock issuable pursuant to the Transaction shall have been
approved for listing on the
The Company's obligation to consummate the Transaction is also subject to, among other things, (i) the accuracy of the representations and warranties of Force and Force Members as of the date of the Purchase Agreement and as of the Closing, subject to the limitations provided in the Purchase Agreement, (ii) each of the covenants of Force having been performed in all material respects, (iii) the key financial results in the Audited Financial Statements (as defined in the Purchase Agreement) and 2022 Audited Financial Statements (as defined in the Purchase Agreement) to be delivered by Force to the Company are substantially consistent with the financial results provided in Exhibit F of the Purchase Agreement; (iv) the Recapitalization shall have been completed; and (v) there has not been any event that has had, or would reasonably be expected to have, a Company Material Adverse Effect (as defined in the Purchase Agreement).
Force's obligation to consummate the Transaction is also subject to, among other things, (i) the accuracy of the representations and warranties of Company as of the date of the Purchase Agreement and as of the Closing, subject to the limitations provided in the Purchase Agreement; and (ii) the Company having performed each of the covenants in all material respects.
Termination
The Purchase Agreement may be terminated at any time prior to the Closing (i) by
mutual written consent of the Company and Force, (ii) by Force, if certain
approvals of the stockholders of the Company, to the extent required under the
Purchase Agreement, are not obtained as set forth therein, (iii) by the Company,
if approval of the Force Members are not obtained by the Company Member Approval
Deadline (as defined in the Purchase Agreement), (iv) by the Company if the
Board of Directors of the Company decides not to continue extending the business
combination deadline for additional months and as a result, the Company would
wind up the affairs and redeem 100% of the outstanding public shares; and (v) by
either the Company or Force in certain other circumstances set forth in the
Purchase Agreement, including (a) if any Governmental Authority (as defined in
the Purchase Agreement) has issued or otherwise entered a final, nonappealable
order making consummation of the Transaction illegal or otherwise preventing or
prohibiting consummation of the Transaction, (b) if any of the closing
conditions have not been satisfied or waived by
Sponsor Support Agreement
Concurrently with the execution of the Purchase Agreement, the Company,
Amended and Restated Registration Rights Agreement
The Purchase Agreement contemplates that, at the Closing, the Company, Sponsor Holdco, holders of shares of Company Class B Common Stock and certain Force Members will enter into an Amended and Restated Registration Rights Agreement, pursuant to which the Company will agree to register for resale, pursuant to Rule 415 under the Securities Act, certain shares of Company Common Stock and other equity securities of the Company that are held by the parties thereto from . . .
Item 7.01 Regulation FD Disclosure.
On
A copy of the investor presentation that will be used by the Company and Force in connection with the transactions contemplated by the Purchase Agreement is attached hereto as Exhibit 99.2 and incorporated by reference herein.
The information in this Item 7.01, including Exhibit 99.1 and Exhibit 99.2, 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 the Company 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 of the information contained in this Item 7.01, including Exhibit 99.1 and Exhibit 99.2.
Forward Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, that involve risks,
uncertainties, and assumptions that are difficult to predict. All statements
other than statements of historical fact contained in this Current Report on
Form 8-K, including statements regarding future events, our future financial
performance, business strategy, and plans and objectives of management for
future operations, are forward-looking statements. The Company has attempted to
identify forward-looking statements by terminology including "anticipates,"
"believes," "can," "continue," "could," "estimates," "expects," "intends,"
"may," "plans," "potential," "predicts," or "should," or the negative of these
terms or other comparable terminology. The forward-looking statements made
herein are based on the Company's current expectations and assumptions about
future events and are based on currently available information as to the outcome
and timing of future events. Actual results could differ materially from those
described or implied by such forward-looking statements as a result of various
important factors, including, without limitation, its limited operating history,
competitive factors in Force's industry and market, and other general economic
conditions. The forward-looking statements made herein are based on the
Company's current expectations, assumptions, and projections, which could be
incorrect. The forward-looking statements made herein speak only as of the date
of this Current Report on Form 8-K and the Company undertakes no obligation to
update publicly such forward-looking statements to reflect subsequent events or
circumstances, except as otherwise required by law. The Company cautions you
that these forward-looking statements are subject to all of the risks and
uncertainties, most of which are difficult to predict and many of which are
beyond the control of the Company, incident to the development, production,
gathering and sale of oil, natural gas and natural gas liquids. In addition, the
Company cautions you that the forward-looking statements contained in this press
release are subject to the following factors: (i) the occurrence of any event,
change or other circumstances that could delay the business combination or give
rise to the termination of the agreements related thereto; (ii) the outcome of
any legal proceedings that may be instituted against the Company following
announcement of the transactions; (iii) the inability to complete the business
combination due to the failure to obtain approval of the stockholders of the
Company, or other conditions to closing in the transaction agreement; (iv) the
inability of the Company and Force to complete a PIPE offering in connection
with the proposed business combination; (v) the risk that the proposed business
combination disrupts Force's current plans and operations as a result of the
announcement of the transactions; (vi) Force's ability to realize the
anticipated benefits of the business combination, which may be affected by,
among other things, competition and the ability of Force to grow and manage
growth profitably following the business combination; (vii) costs related to the
business combination; (viii) changes in applicable laws or regulations; and
(viii) the possibility that Force may be adversely affected by other economic,
business, and/or competitive factors. Should one or more of the risks or
uncertainties described in this press release, or should underlying assumptions
prove incorrect, actual results and plans could different materially from those
expressed in any forward-looking statements. Additional information concerning
these and other factors that may impact the operations and projections discussed
herein can be found in the Company's periodic filings with the
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Additional Information and Where to Find It
The Company will prepare a proxy statement (the "Proxy Statement") to be filed
with the
Participants in the Solicitation
The Company and certain of its respective directors and executive officers may
be deemed to be participants in the solicitation of proxies, in favor of the
approval of the proposed Transaction related matters. Information regarding the
Company's directors and executive officers is contained in the section of the
Company's Form S-1 titled "Management", which went effective with the
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description 2.1 Membership Interests Purchase Agreement, datedMarch 21, 2023 , by and amongStratim Cloud Acquisition Corp. ,Force Pressure Control, LLC and each of the individuals listed on the signature page thereto 10.1 Sponsor Support Agreement, datedMarch 21, 2023 , by and amongStratim Cloud Acquisition Corp. ,Stratim Cloud Acquisition, LLC ,Force Pressure Control, LLC and each of the individuals listed on the signature page thereto 99.1 Press Release, datedMarch 22, 2022 , announcing the Company's entrance into the Purchase Agreement 99.2 Investor Presentation 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) 4
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