Delaware |
6770 |
85-2560226 | ||
(State or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Number) |
Sarah K. Morgan John Kupiec Vinson & Elkins L.L.P. 1001 Fannin Street, Suite 2500 Houston, TX 77002 (713) 758-2222 |
Gene Sheridan Chief Executive Officer Navitas Semiconductor Limited 22 Fitzwilliam Square South Dublin, D02 FH68 Ireland |
Jonathan Axelrad Jeffrey C. Selman John F. Maselli DLA Piper LLP 555 Mission Street Suite 2400 San Francisco, CA 94105 (415) 836-2500 |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☒ | Smaller reporting company | ||||
Emerging growth company |
| ||||||||
Title of Each Class of Securities to be Registered |
Amount to be Registered(1) |
Proposed Maximum Offering Price per Share |
Proposed Maximum Aggregate Offering Price(2) |
Amount of Registration Fee(3) | ||||
Class A Common Stock, par value $0.0001 per share |
105,000,000 | N/A | $1,041,600,000 | $113,638.56 | ||||
| ||||||||
|
(1) | Based on the maximum number of shares of Class A common stock, par value $0.0001 per share (“Class A Common Stock”), of the registrant estimated to be issued in connection with the Merger (as defined herein) and the Tender Offer (as defined herein). |
(2) | Pursuant to Rules 457(c) and 457(f)(1) promulgated under the Securities Act of 1933, as amended (the “Securities Act”), and solely for the purpose of calculating the registration fee, the proposed maximum aggregate offering price is an amount equal to $ 1,041,600,000, calculated as follows: the product of (i) 105,000,000 shares of Class A Common Stock, the Registrant’s initial estimate of the maximum number of shares of Class A Common Stock that may be issued in connection with the Merger and the Tender Offer, and (ii) $9.92, the average of the high and low trading prices of the Class A Common Stock on June 1, 2021). |
(3) | Previously paid. |
Sincerely, |
|
Richard J. Hendrix Chief Executive Officer and Director |
• |
The Business Combination Proposal Annex A |
• |
The Charter Proposals |
• |
The Authorized Share Charter Proposal |
• |
The Additional Charter Proposal |
• |
The PIPE Proposal |
• |
The 2021 Plan Proposal Annex C |
• |
The Director Election Proposal |
• |
The Adjournment Proposal |
By Order of the Board of Directors |
|
Richard J. Hendrix Chief Executive Officer and Director |
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D-1 |
• | “2020 Equity Incentive Plan” are to Navitas’ 2020 Equity Incentive Plan, as amended, supplemented or modified from time to time; |
• | “2021 Plan” are to the Navitas Semiconductor Corporation 2021 Equity Incentive Plan, that is the subject of the 2021 Plan Proposal and a copy of which is attached to this proxy statement/prospectus as Annex C |
• | “Additional PIPE” are to the private offering of securities of LOKB to the Additional PIPE Investor in connection with the Business Combination; |
• | “Additional PIPE Investor” are to China Ireland Growth Technology Fund II, L.P., the sole investor in the Additional PIPE Financing and an affiliate of an existing shareholder of Navitas; |
• | “Business Combination” are to the transactions contemplated by the Business Combination Agreement; |
• | “Business Combination Agreement” are to that certain Business Combination Agreement and Plan of Reorganization, dated as of May 6, 2021, by and among LOKB, Merger Sub and Navitas; |
• | “Charter” are to LOKB’s Amended and Restated Certificate of Incorporation; |
• | “Class A Common Stock” are to shares of LOKB’s Class A common stock, par value $0.0001 per share; |
• | “Class B Common Stock” are to shares of LOKB’s Class B common stock, par value $0.0001 per share; |
• | “Closing” are to the closing of the Business Combination; |
• | “Closing Date” are to the date on which the Closing occurs; |
• | “Code” are to the Internal Revenue Code of 1986, as amended; |
• | “Earnout Period” are to the time period beginning on the day following the first 150 days following the Closing and ending on the five-year anniversary of the Closing Date; |
• | “Earnout Shares” are to the up to 10,000,000 additional shares of Class A Common Stock that LOKB may issue to Eligible Navitas Equityholders in three equal tranches upon the satisfaction of price targets of $12.50, $17.00 or $20.00, which price targets are based upon the volume-weighted average closing sale price of one share of Class A Common Stock quoted on the exchange on which the shares of Class A Common Stock are then traded, for any 20 trading days within any 30 consecutive trading day period during the Earnout Period, or upon certain change of control transactions that imply a per share value that would satisfy the price targets; |
• | “Effective Time” are to the date and time the Merger becomes effective; |
• | “Eligible Navitas Equityholder” are to (a) a holder of a Navitas Ireland Common Share or Navitas Delaware Common Share (including, for the avoidance of doubt, a Navitas Ireland Restricted Share or a Navitas Delaware Restricted Share) immediately prior to the Closing; (b) a holder of a Navitas Ireland Preferred Share or a Navitas Delaware Preferred Share immediately prior to the Closing; (c) a holder of a Navitas Ireland Option or Navitas Delaware Option immediately prior to the Closing; (d) a holder of a Navitas Ireland Warrant or Navitas Delaware Warrant immediately prior to the Closing; and (e) a holder of a Navitas Ireland Restricted Stock Unit or a Navitas Delaware Restricted Stock Unit immediately prior to the Closing; |
• | “Founders Stock” are to shares of LOKB Class B Common Stock held by our Sponsor prior to the IPO, and the shares of Class A Common Stock issued upon the conversion thereof; |
• | “HSR Act” are to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; |
• | “Initial Business Combination” are to our initial merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses; |
• | “Initial Public Offering” or “IPO” are to LOKB’s initial public offering of units, which closed on December 7, 2020; |
• | “IRS” are to the Internal Revenue Service; |
• | “LOKB,” “we,” “our,” “us” or the “Company” are to Live Oak Acquisition Corp. II, a Delaware corporation, and including LOKB after giving effect to the Business Combination; |
• | “LOKB Board” are to the board of directors of LOKB; |
• | “LOKB Cash” are to, as of the date or time of determination: (a) all amounts in the Trust Account (for the avoidance of doubt, prior to exercise of redemption rights in accordance with LOKB’s organizational documents, if any); plus (b) all other cash and cash equivalents of LOKB (for the avoidance of doubt, excluding the amounts described in the immediately preceding clause (a)); plus (c) the amount finally delivered to LOKB at or prior to the Closing in connection with the consummation of the PIPE Financing; |
• | “LOKB Common Stock” are to the Class A Common Stock and the Class B Common Stock; |
• | “LOKB Preferred Stock” are to LOKB’s Preferred Stock, par value $0.0001 per share; |
• | “LOKB Transaction Costs” are to all out-of-pocket |
• | “LOKB Warrants” means the public warrants and the private placement warrants; |
• | “management” or our “management team” are to our officers and directors; |
• | “Merger” are to the merger of Merger Sub with and into Navitas Delaware, with Navitas Delaware surviving the merger as a wholly owned subsidiary of LOKB; |
• | “Merger Sub” are to Live Oak Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of LOKB; |
• | “Merger Sub Common Stock” are to shares of Merger Sub’s common stock, par value $0.0001 per share; |
• | “NASDAQ” are to the Nasdaq Global Market; |
• | “Navitas” are to Navitas Ireland together with Navitas Delaware; |
• | “Navitas Board” are to the board of directors of Navitas; |
• | “Navitas Common Shares” are to the Navitas Delaware Common Shares and the Navitas Ireland Common Shares; |
• | “Navitas Delaware” are to Navitas Semiconductor Ireland, LLC, a Delaware limited liability company; |
• | “Navitas Delaware Exchange Ratio” means the quotient (rounded to four decimal places) obtained by dividing (x) (1) $950,000,000 (as reduced by the estimated Irish stamp duty amount) (2) multiplied by the percentage of the value of Navitas allocated to the shares of Navitas Delaware as determined by a valuation analysis (3) divided by $10.00 by (y) the total number of Navitas Delaware Common Shares outstanding immediately prior to the Closing, expressed on a fully-diluted and as-converted to Navitas Delaware Common Shares basis, and including without duplication, (A) the number of Navitas Delaware Common Shares (including Navitas Delaware Restricted Shares), (B) the number of Navitas Delaware Preferred Shares that would be issuable upon a conversion of all the Navitas Delaware Preferred Shares, (C) the number of Navitas Delaware Common Shares subject to Navitas Delaware Options that are issuable upon the net exercise of such Navitas Delaware Options, (D) the number of Navitas Delaware Common Shares issuable upon the cash exercise of the unexpired Navitas Delaware Warrants (assuming that any Navitas Delaware Warrants that are exercisable for Navitas Delaware Preferred Shares are exercisable for the number of Navitas Delaware Common Shares into which such Navitas Delaware Preferred Shares are convertible) and (E) the number of Navitas Delaware Common Shares issuable upon the settlement of Navitas Delaware Restricted Stock Units granted following the date of the Business Combination Agreement and prior to the Closing (assuming no net settlements) (assuming, solely for purposes of the foregoing clauses (A) through (E), that all Navitas Delaware Options, Navitas Delaware Warrants and Navitas Delaware Restricted Stock Units are vested and after taking into consideration any Navitas Delaware Warrants that are terminated, exercised or deemed exercised by their terms as contemplated by the Business Combination Agreement prior to the Offer Expiration Time); |
• | “Navitas Delaware Options” are to all incentive stock options and nonqualified stock options to purchase outstanding Navitas Ireland Common Shares, whether or not exercisable and whether or not vested, immediately prior to the Closing under the 2020 Equity Incentive Plan. For the avoidance of doubt, “Navitas Delaware Options” will not include any “Navitas Delaware Warrants”; |
• | “Navitas Delaware Preferred Shares” are to Navitas Delaware Series A Preferred Shares, Navitas Delaware Series B Preferred Shares, Navitas Delaware Series B-1 Preferred Shares and Navitas Delaware Series B-2 Preferred Shares; |
• | “Navitas Delaware Restricted Shares” are to the unvested restricted shares of Navitas Delaware Common Shares granted pursuant to (a) the 2020 Equity Incentive Plan (including, for clarity, upon the exercise of Navitas Delaware Options) or (b) any other written agreement imposing vesting and forfeiture restrictions; |
• | “Navitas Delaware Restricted Stock Unit” are to the outstanding restricted stock units of Navitas Delaware granted pursuant to (a) the 2020 Equity Incentive Plan following the date of the Business Combination Agreement and prior to the Closing; |
• | “Navitas Delaware Series A Preferred Shares” means the limited liability company interests represented by the preferred shares, par value $0.0001 per share, designated as Series A Preferred Stock in the Navitas Governing Documents; |
• | “Navitas Delaware Series B Preferred Shares” means the limited liability company interests represented by the preferred shares, par value $0.0001 per share, designated as Series B Preferred Stock in the Navitas Governing Documents; |
• | “Navitas Delaware Series B-1 Preferred Shares” means the limited liability company interests represented by the preferred shares, par value $0.0001 per share, designated as Series B-1 Preferred Stock in the Navitas Governing Documents; |
• | “Navitas Delaware Series B-2 Preferred Shares” means the limited liability company interests represented by the preferred shares, par value $0.0001 per share, designated as Series B-2 Preferred Stock in the Navitas Governing Documents; |
• | “Navitas Delaware Warrants” are to unexpired warrants to purchase Navitas Delaware Preferred Shares or Navitas Delaware Common Shares; |
• | “Navitas Governing Documents” means (a) the Constitution of Navitas adopted by special resolution passed on September 1, 2020 and (b) the Shareholders’ Agreement relating to Navitas dated September 1, 2020, in each case, as amended, supplemented or modified from time to time; |
• | “Navitas Ireland” are to Navitas Semiconductor Limited, a private company limited by shares organized under the Laws of Ireland; |
• | “Navitas Ireland Exchange Ratio” means (x) the quotient (rounded to four decimal places) obtained by dividing (y) (1) $950,000,000 (as reduced by the estimated Irish stamp duty amount) (2) multiplied by the percentage of the value of Navitas allocated to the shares of Navitas Ireland as determined by a valuation analysis (3) divided by $10.00 by (z) the total number of Navitas Ireland Common Shares outstanding immediately prior to the Closing, expressed on a fully-diluted and as-converted to Navitas Ireland Common Shares basis, and including without duplication, (A) the number of Navitas Ireland Common Shares (including Navitas Ireland Restricted Shares), (B) the number of Navitas Ireland Preferred Shares that would be issuable upon a conversion of all the Navitas Ireland Preferred Shares, (C) the number of Navitas Ireland Common Shares subject to Navitas Ireland Options that are issuable upon the net exercise of such Navitas Ireland Options, (D) the number of Navitas Ireland Common Shares issuable upon the cash exercise of the unexpired Navitas Ireland Warrants (assuming that any Navitas Ireland Warrants that are exercisable for Navitas Ireland Preferred Shares are exercisable for the number of Navitas Ireland Common Shares into which the Navitas Ireland Preferred Shares are convertible), and (E) the number of Navitas Ireland Common Shares issuable upon the settlement of Navitas Ireland Restricted Stock Units granted following the date of the Business Combination Agreement and prior to the Closing (assuming no net settlements) (assuming, solely for purposes of the foregoing clauses (A) through (E), that all Navitas Ireland Options, Navitas Ireland Warrants and Navitas Ireland Restricted Stock Units are vested and after taking into consideration any Navitas Ireland Warrants that are terminated, exercised or deemed exercised by their terms as contemplated by the Business Combination Agreement prior to the Offer Expiration Time); |
• | “Navitas Ireland Options” means all incentive stock options and nonqualified stock options to purchase allotted Navitas Ireland Shares, whether or not exercisable and whether or not vested, immediately prior to the Closing under the 2020 Equity Incentive Plan. For the avoidance of doubt, “Navitas Ireland Options” will not include any “Navitas Ireland Warrants”; |
• | “Navitas Ireland Preferred Shares” means the Navitas Ireland Series A Preferred Shares, Navitas Ireland Series B Preferred Shares, Navitas Ireland Series B-1 Preferred Shares and Navitas Ireland Series B-2 Preferred Shares; |
• | “Navitas Ireland Restricted Shares” means the allotted restricted Navitas Ireland Common Shares granted pursuant to (a) the 2020 Equity Incentive Plan (including, for clarity, upon the exercise of Navitas Ireland Options) or (b) any other written agreement imposing vesting and forfeiture restrictions; |
• | “Navitas Ireland Restricted Stock Units” means the outstanding restricted stock units of Navitas Ireland granted pursuant to the 2020 Equity Incentive Plan following the date of the Business Combination Agreement and prior to the Closing; |
• | “Navitas Ireland Series A Preferred Shares” means Navitas Ireland’s preferred shares, par value $0.0001 per share, designated as Series A Preferred Stock in the Navitas Governing Documents; |
• | “Navitas Ireland Series B Preferred Shares” means Navitas Ireland’s preferred shares, par value $0.0001 per share, designated as Series B Preferred Stock in the Navitas Governing Documents; |
• | “Navitas Ireland Series B-1 Preferred Shares” means Navitas Ireland’s preferred shares, par value $0.0001 per share, designated as Series B-1 Preferred Stock in the Navitas Governing Documents; |
• | “Navitas Ireland Series B-2 Preferred Shares” means Navitas Ireland’s preferred shares, par value $0.0001 per share, designated as Series B-2 Preferred Stock in the Navitas Governing Documents; |
• | “Navitas Ireland Shares” means the Navitas Ireland Common Shares and the Navitas Ireland Preferred Shares; |
• | “Navitas Ireland Warrants” are to unexpired warrants to purchase Navitas Ireland Preferred Shares or Navitas Ireland Common Shares; |
• | “Navitas Options” are to the Navitas Delaware Options and the Navitas Ireland Options; |
• | “Navitas Preferred Shares” are to the Navitas Delaware Preferred Shares and the Navitas Ireland Preferred Shares; |
• | “Navitas Shareholders” are to (a) a holder of a Navitas Ireland Common Share or Navitas Delaware Common Share (including, for the avoidance of doubt, a Navitas Ireland Restricted Share or a Navitas Delaware Restricted Share) immediately prior to the Closing; (b) a holder of a Navitas Ireland Preferred Share or a Navitas Delaware Preferred Share immediately prior to the Closing; |
• | “Navitas Shares” are to the Navitas Common Shares and Navitas Preferred Shares; |
• | “Navitas Restricted Shares” are to the Navitas Delaware Restricted Shares and the Navitas Ireland Restricted Shares; |
• | “Navitas Restricted Stock Units” are to the Navitas Delaware Restricted Stock Units and the Navitas Ireland Restricted Stock Units; |
• | “Navitas Warrants” are to Navitas Delaware Warrants and Navitas Ireland Warrants; |
• | “PIPE Financing” are to the Signing PIPE and the Additional PIPE, collectively; |
• | “PIPE Investors” are to investors in the PIPE Financing; |
• | “PIPE Shares” are to the shares of Class A Common Stock that are issued in the PIPE Financing; |
• | “Preferred Stock” are to LOKB’s Preferred Stock, par value $0.0001 per share; |
• | “private placement warrants” are to the warrants issued to our Sponsor in a private placement simultaneously with the closing of our IPO; |
• | “public shares” are to shares of our Class A Common Stock sold as part of the units in the IPO (whether they were purchased in the IPO or thereafter in the open market); |
• | “public stockholders” are to the holders of our public shares; |
• | “public warrants” are to the warrants sold as part of the units in the IPO (whether they were purchased in the IPO or thereafter in the open market); |
• | “Signing PIPE” are to the private offering of securities of LOKB to certain investors that entered into subscription agreements with LOKB as of the date of the Business Combination Agreement; |
• | “Signing PIPE Investors” are to the investors in the Signing PIPE; |
• | “special meeting” are to the special meeting of stockholders of LOKB that is the subject of this proxy statement/prospectus and any adjournments or postponements thereof; |
• | “Sponsor” are to Live Oak Sponsor Partners II, LLC, a Delaware limited liability company; |
• | “Trust Account” are to the trust account that holds the proceeds (including interest not previously released to LOKB to pay its taxes) from the IPO and a concurrent private placement of private placement warrants to our Sponsor; |
• | “units” are to our units sold in the IPO, each of which consists of one share of Class A Common Stock and one-third of one public warrant; and |
• | “voting common stock” are to our Class A Common Stock and Class B Common Stock. |
• | LOKB is a blank check company incorporated on August 12, 2020 as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. For more information about LOKB, see the section entitled “Information About LOKB.” When you consider the LOKB Board’s recommendation of the Proposals, you should keep in mind that our directors and officers have interests in the Business Combination that are different from, or in addition to, the interests of LOKB stockholders generally. Our directors were aware of and considered these interests, among other matters, in evaluating the Business Combination, and in recommending to stockholders that they approve the Business Combination. In certain instances, the LOKB Board had the conflicted transactions approved by the audit committee of the board in accordance with LOKB’s related party transaction policy. These interests may have influenced the members of the LOKB Board in making their recommendation that you vote in favor of the approval of the Business Combination. Stockholders should take these interests into account in deciding whether to approve the Business Combination. See the subsection entitled “The Business Combination — Interests of Certain Persons in the Business Combination” for additional information. The LOKB Board was aware of and considered these interests, among other matters, in recommending that LOKB stockholders vote “FOR” each of the Proposals. |
• | There are currently 25,300,000 shares of LOKB’s Class A Common Stock and 6,325,000 shares of LOKB’s Class B Common Stock issued and outstanding. In addition, there are currently 13,100,001 LOKB Warrants outstanding, consisting of 8,433,333 public warrants and 4,666,667 private placement warrants. Each whole warrant entitles the holder to purchase one whole share of Class A Common Stock for $11.50 per share. The warrants will become exercisable on the later of (a) 30 days after the completion of an Initial Business Combination and (b) 12 months from the closing of the Initial Public Offering and will expire five years after the completion of an Initial Business Combination or earlier upon redemption or liquidation. Once the warrants become exercisable, LOKB may redeem the outstanding warrants, in whole and not in part, for cash in accordance with, and subject to the terms of, the warrant agreement. The private placement warrants, however, are non-redeemable so long as they are held by our Sponsor or its permitted transferees. For more information about the terms of the warrants, see the subsection entitled “Description of Securities — Warrants.” |
• | Navitas was founded in 2013 and has since been developing ultra-efficient gallium nitride (GaN) semiconductors that are revolutionizing the world of power electronics in terms of efficiency, performance, size, cost and sustainability. For more information about Navitas, see the sections entitled “Information About Navitas” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Navitas.” |
• | On May 6, 2021, we and our wholly owned subsidiary, Merger Sub, entered into the Business Combination Agreement with Navitas. A copy of the Business Combination Agreement is attached to this proxy statement/prospectus as Annex A |
• | Pursuant to the Business Combination Agreement, and subject to the terms and conditions contained therein, LOKB will commence the Tender Offer and Merger Sub will merge with and into Navitas Delaware with the consummation of the Tender Offer and the Merger resulting in Navitas becoming a wholly owned subsidiary of LOKB. For more information about the Business Combination Agreement and the Business Combination, see the section entitled “The Business Combination.” |
• | At the Closing, up to 95,000,000 shares of Class A Common Stock will be, in the aggregate, issued to the Eligible Navitas Equityholders in the Business Combination in exchange for all outstanding Navitas Shares or reserved for issuance in respect of (a) LOKB options issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Options, (b) LOKB restricted stock issued in exchange for the release and extinguishment of outstanding pre-Business Combination Navitas Restricted Shares, (c) LOKB restricted stock units issued in exchange for the release and extinguishment of outstanding pre-Business Combination Navitas Restricted Stock Units and (d) LOKB warrants issued in exchange for the release and extinguishment of outstanding pre-Business Combination Navitas Warrants. Additionally, during the Earnout Period, we may issue to Eligible Navitas Equityholders up to 10,000,000 additional shares of Class A Common Stock in the aggregate, referred to herein as the Earnout Shares, in three equal tranches upon the occurrence of each Earnout Triggering Event. For more information about the Business Combination Agreement and the Business Combination, see the section entitled “The Business Combination.” |
• | Unless lawfully waived by the parties to the Business Combination Agreement, the Closing is subject to a number of conditions set forth in the Business Combination Agreement, including, among others, receipt of the requisite LOKB and Navitas Delaware shareholder approval of, as applicable, the Business Combination Agreement, the Business Combination as contemplated by this proxy statement/prospectus, the Charter Proposals and the PIPE Proposal. For more information about the closing conditions to the Business Combination, see the subsection entitled “The Business Combination — Conditions to Closing of the Business Combination Agreement.” |
• | The Business Combination Agreement may be terminated at any time prior to the consummation of the Business Combination upon agreement of the parties thereto, or for other reasons in specified circumstances. For more information about the termination rights under the Business Combination Agreement, see the subsection entitled “The Business Combination — Termination.” |
• | The proposed Business Combination involves numerous risks. For more information about these risks, please see the section entitled “Risk Factors.” |
• | Pursuant to the PIPE Financing, we have agreed to issue and sell to certain investors, and those investors have agreed to buy from us, in connection with the Closing, an aggregate of 15,500,000 shares of Class A Common Stock at a purchase price of $10.00 per share for an aggregate commitment of $155,000,000. Such Class A Common Stock would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2021. |
• | Under our Charter, in connection with the Business Combination, our public stockholders may elect to have their shares redeemed for cash at the applicable redemption price per share calculated in accordance with our Charter. As of June 30, 2021, this would have amounted to approximately $10.00 per share. If a holder exercises its redemption rights, then such holder will be exchanging its public shares for cash and will no longer own shares of LOKB following the completion of the Business Combination and will not participate in the future growth of LOKB, if any. Such a holder will be entitled to receive cash for its public shares only if it properly demands redemption and delivers its shares (either physically or electronically) to our transfer agent at least two business days prior to the special meeting. For more information regarding these procedures, see the subsection entitled “Special Meeting of LOKB Stockholders — Redemption Rights.” |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
25,300,000 | 17.8 | 17,400,000 | 13.0 | 9,500,000 | 7.5 | ||||||||||||||||||
Sponsor(1) |
6,325,000 | 4.5 | 6,325,000 | 4.7 | 6,325,000 | 5.0 | ||||||||||||||||||
Eligible Navitas Equityholders(2)(3) |
95,000,000 | 66.8 | 95,000,000 | 70.8 | 95,000,000 | 75.2 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 10.9 | 15,500,000 | 11.5 | 15,500,000 | 12.3 | ||||||||||||||||||
|
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|
|
|
|
|
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|
|
|||||||||||||
Total |
142,125,000 | 100.00 | 134,225,000 | 100.00 | 126,325,000 | 100.00 | ||||||||||||||||||
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|
(1) | LOKB Class A Common Stock owned upon conversion of shares of Founders Stock and, in the case of our Sponsor, includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. |
(2) | Includes (x) the up to approximately 78,300,000 shares of our Class A Common Stock anticipated to be issued to Navitas Shareholders and (y) the up to approximately 16,700,000 shares of our Class A Common Stock anticipated to be reserved for issuance in respect of (i) LOKB options issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Options, (ii) LOKB restricted stock issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Shares, (iii) LOKB restricted stock units issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Stock Units and (iv) LOKB warrants issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Warrants, in each case that may be exercised at a later date. |
(3) | Excludes (i) the reduction in the aggregate number of shares of Class A Common Stock issuable under the Business Combination Agreement based on the estimated stamp duty, as such amount will not be known with certainty until immediately prior to Closing, and (ii) the potential issuance of the Earnout Shares to the Eligible Navitas Equityholders. During the Earnout Period, we may issue to Eligible Navitas Equityholders up to 10,000,000 additional shares of Class A Common Stock in the aggregate in three equal tranches upon the satisfaction of price targets of $12.50, $17.00 or $20.00, which price targets are based upon the volume-weighted average closing sale price of one share of Class A Common Stock quoted on the exchange on which the shares of Class A Common Stock are then traded, for any 20 trading days within any 30 consecutive trading day period during the Earnout Period, or upon certain change of control transactions that imply a per share value that would satisfy the price targets. |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
33,733,334 | 21.7 | 25,833,334 | 17.5 | 17,933,334 | 12.9 | ||||||||||||||||||
Sponsor(1) |
10,991,667 | 7.1 | 10,991,667 | 7.5 | 10,991,667 | 7.9 | ||||||||||||||||||
Eligible Navitas Equityholders |
95,000,000 | 61.2 | 95,000,000 | 64.5 | 95,000,000 | 68.1 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 10.0 | 15,500,000 | 10.5 | 15,500,000 | 11.1 | ||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
155,225,001 | 100.00 | 147,325,001 | 100.00 | 139,425,001 | 100.00 | ||||||||||||||||||
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|
|
(1) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. Also includes 1,500,000 shares underlying private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination — Sponsor Letter Amendment” and “The Business Combination — Backstop Agreement” for more information. |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
33,733,334 | 20.4 | 25,833,334 | 16.4 | 17,933,334 | 12.0 | ||||||||||||||||||
Sponsor(1) |
10,991,667 | 6.7 | 10,991,667 | 7.0 | 10,991,667 | 7.4 | ||||||||||||||||||
Eligible Navitas Equityholders |
105,000,000 | 63.5 | 105,000,000 | 66.7 | 105,000,000 | 70.3 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 9.4 | 15,500,000 | 9.9 | 15,500,000 | 10.4 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
165,225,001 | 100.00 | 157,325,001 | 100.00 | 149,425,001 | 100.00 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. Also includes 1,500,000 shares underlying private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination — Sponsor Letter Amendment” and “The Business Combination — Backstop Agreement” for more information. |
• | an amendment to our Charter to increase the number of authorized shares of LOKB’s capital stock, par value $0.0001 per share, from 111,000,000 shares, consisting of (a) 110,000,000 shares of LOKB Common |
Stock, including 100,000,000 shares of Class A Common Stock and 10,000,000 shares of Class B Common Stock and (b) 1,000,000 shares of LOKB Preferred Stock, to shares, consisting of (i) shares of common stock and (ii) shares of preferred stock (the “Authorized Share Charter Proposal”); |
• | amendments to our Charter to make certain other changes that the LOKB Board deems appropriate for a public operating company, including (a) eliminating provisions in the Charter relating to an Initial Business Combination that will no longer be applicable to us following the Closing, including provisions relating to (i) redemption rights with respect to Class A Common Stock, (ii) the Trust Account, (iii) share issuances prior to the consummation of the Initial Business Combination, (iv) transactions with affiliates and other blank check companies, (v) approval of the Initial Business Combination and (vi) the minimum value of the target in the Initial Business Combination and (b) to change the post-combination company’s name to “Navitas Semiconductor Corporation” (collectively, the “Additional Charter Proposal” and, together with the Authorized Share Charter Proposal the “Charter Proposals”); |
• | for purposes of complying with applicable listing rules of the NYSE, the issuance and sale to the PIPE Investors of 15,500,000 shares of Class A Common Stock in the PIPE Financing, which will occur substantially concurrently with, and is contingent upon, the consummation of the transactions contemplated by the Business Combination Agreement (the “PIPE Proposal”); |
• | the 2021 Plan and material terms thereunder (the “2021 Plan Proposal”); |
• | the election, effective immediately after the Effective Time, of two directors to serve until the 2022 annual meeting of stockholders, three directors to serve until the 2023 annual meeting of stockholders and two directors to serve until the 2024 annual meeting of stockholders, and until their respective successors are duly elected and qualified, subject to such directors’ earlier death, resignation, retirement, disqualification or removal (the “Director Election Proposal”); and |
• | the adjournment of the special meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Business Combination Proposal, the Charter Proposals, the PIPE Proposal, the 2021 Plan Proposal or the Director Election Proposal (the “Adjournment Proposal” and, together with the Business Combination Proposal, the Charter Proposals, the PIPE Proposal, the 2021 Plan Proposal and the Director Election Proposal, the “Proposals”). |
Q: |
Why am I receiving this proxy statement/prospectus? |
A: | LOKB is sending this proxy statement/prospectus to its stockholders to help them decide how to vote their LOKB Common Stock with respect to the matters to be considered at the special meeting. LOKB stockholders are being asked to consider and vote upon, among other things, a proposal to (a) approve and adopt the Business Combination Agreement, pursuant to which LOKB will commence the Tender Offer and Merger Sub will merge with and into Navitas Delaware, with the consummation of the Tender Offer and the Merger resulting in Navitas being a wholly owned subsidiary of LOKB, (b) approve the Tender Offer, the Merger and the other transactions contemplated by the Business Combination Agreement and (c) approve, for purposes of complying with applicable listing rules of the NYSE, (i) the issuance pursuant to the Business Combination Agreement (including with respect to the Tender Offer and the Merger) of up to an aggregate of 105,000,000 shares of Class A Common Stock to the Navitas Shareholders in connection with the Business Combination, including the issuance of shares of Class A Common Stock (i) in connection with the Closing as part of the Per Share Tender Offer Consideration and the Per Share Merger Consideration, (ii) as Earnout Shares upon the occurrence of the applicable Earnout Triggering Events and (iii) that may be reserved for issuance in respect of (A) LOKB options issued in exchange for outstanding pre-business combination Navitas Options, (B) LOKB restricted stock issued in exchange for outstanding pre-business combination Navitas Restricted Shares, (C) LOKB restricted stock units issued in exchange for outstanding pre-business combination Navitas Restricted Stock Units and (D) LOKB warrants issued in exchange for outstanding pre-business combination Navitas Warrants and (ii) the issuance and sale to the PIPE Investors of 15,500,000 shares of Class A Common Stock in the PIPE Financing, which will occur substantially concurrently with, and is contingent upon, the consummation of the transactions contemplated by the Business Combination Agreement. The Business Combination cannot be completed unless LOKB stockholders approve the Business Combination Proposal, the Charter Proposals and the PIPE Proposal. |
Q: |
What is being voted on at the special meeting? |
A: | LOKB stockholders will vote on the following proposals at the special meeting. |
• | The Business Combination Proposal |
• | The Charter Proposals |
• | The Authorized Share Charter Proposal |
• | The Additional Charter Proposal |
• | The PIPE Proposal |
• | The 2021 Plan Proposal Annex C |
• | The Director Election Proposal |
• | The Adjournment Proposal |
Q: |
Are the Proposals conditioned on one another? |
A: | It is a condition to the closing of the Business Combination that the Business Combination Proposal, the Charter Proposal, the PIPE Proposal, the 2021 Plan Proposal and the Director Election Proposal are approved at the special meeting. The Charter Proposal, the 2021 Plan Proposal and the Director Election Proposal are conditioned on the approval of the Business Combination Proposal and the PIPE Proposal. The Adjournment Proposal is not conditioned on the approval of any other Proposal set forth in this proxy statement/prospectus. |
Q: |
What will happen in the Business Combination? |
A: | On May 6, 2021, LOKB and Merger Sub entered into the Business Combination Agreement with Navitas. Pursuant to the Business Combination Agreement, and subject to the terms and conditions contained therein, LOKB will commence the Tender Offer, and Merger Sub will merge with and into Navitas Delaware, with the consummation of the Tender Offer and the Merger resulting in Navitas becoming a wholly owned subsidiary of LOKB. Additionally, during the Earnout Period, we may issue to Eligible Navitas Equityholders up to 10,000,000 additional shares of Class A Common Stock in the aggregate, referred to herein as the Earnout Shares, in three equal tranches upon the occurrence of each Earnout Triggering Event. For more information about the Business Combination Agreement and the Business Combination, see the section entitled “The Business Combination.” |
Q: |
Why is LOKB proposing the Business Combination? |
A: | LOKB was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination involving LOKB and one or more businesses. |
Q: |
What conditions must be satisfied to complete the Business Combination? |
A: | There are a number of Closing conditions in the Business Combination Agreement, including the approval by our stockholders of the Business Combination Proposal, the Charter Proposals, the PIPE Proposal, the Director Election Proposal and the 2021 Plan Proposal. For a summary of the conditions that must be satisfied or waived prior to completion of the Business Combination, see the subsection entitled “The Business Combination — Conditions to Closing of the Business Combination Agreement.” |
Q: |
How will LOKB be managed and governed following the Business Combination? |
A: | Immediately after the Closing, the board of directors of the post-combination company will be divided into three separate classes, designated as follows: |
• | the Class I directors will be Gene Sheridan and Daniel Kinzer and their terms will expire at the annual meeting of stockholders to be held in 2022; |
• | the Class II directors will be Brian Long, Dipender Saluja and David Moxam and their terms will expire at the annual meeting of stockholders to be held in 2023; and |
• | the Class III directors will be Richard J. Hendrix and Gary K. Wunderlich and their terms will expire at the annual meeting of stockholders to be held in 2024. |
Q: |
Will LOKB obtain new financing in connection with the Business Combination? |
A: | The PIPE Investors have committed to purchase from LOKB 15,500,000 shares of Class A Common Stock, for an aggregate purchase price of approximately $155,000,000 in the PIPE Financing. |
Q: |
What equity stake will our current stockholders and the holders of our Founders Stock hold in LOKB following the consummation of the Business Combination? |
A: | The following table presents the anticipated share ownership of various holders of LOKB upon the Closing of the Business Combination, which does not give effect to the potential exercise of any warrants and otherwise assumes the following redemption scenarios: |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
25,300,000 | 17.8 | 17,400,000 | 13.0 | 9,500,000 | 7.5 | ||||||||||||||||||
Sponsor(1) |
6,325,000 | 4.5 | 6,325,000 | 4.7 | 6,325,000 | 5.0 | ||||||||||||||||||
Eligible Navitas Equityholders(2)(3) |
95,000,000 | 66.8 | 95,000,000 | 70.8 | 95,000,000 | 75.2 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 10.9 | 15,500,000 | 11.5 | 15,500,000 | 12.3 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
142,125,000 | 100.00 | 134,225,000 | 100.00 | 126,325,000 | 100.00 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Equity Value Post- Redemptions ($ in millions) |
$ | 1,421 | $ | 1,342 | $ | 1,263 | ||||||||||||||||||
Per Share Value |
$ | 10.00 | $ | 10.00 | $ | 10.00 |
(1) | LOKB Class A Common Stock owned upon conversion of shares of Founders Stock and, in the case of our Sponsor, includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. |
(2) | Includes (x) the up to approximately 78,300,000 shares of our Class A Common Stock anticipated to be issued to Navitas Shareholders and (y) the up to approximately 16,700,000 shares of our Class A Common Stock anticipated to be reserved for issuance in respect of (i) LOKB options issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Options, (ii) LOKB restricted stock issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Shares, (iii) LOKB restricted stock units issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Stock Units and (iv) LOKB warrants issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Warrants, in each case that may be exercised at a later date. |
(3) | Excludes (i) the reduction in the aggregate number of shares of Class A Common Stock issuable under the Business Combination Agreement based on the estimated stamp duty, as such amount will not be known with certainty until immediately prior to Closing, and (ii) the potential issuance of the Earnout Shares to the Eligible Navitas Equityholders. During the Earnout Period, we may issue to Eligible Navitas Equityholders up to 10,000,000 additional shares of Class A Common Stock in the aggregate in three equal tranches upon the satisfaction of price targets of $12.50, $17.00 or $20.00, which price targets are based upon the volume-weighted average closing sale price of one share of Class A Common Stock quoted on the exchange on which the shares of Class A Common Stock are then traded, for any 20 trading days within any 30 consecutive trading day period during the Earnout Period, or upon certain change of control transactions that imply a per share value that would satisfy the price targets. |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
33,733,334 | 21.7 | 25,833,334 | 17.5 | 17,933,334 | 12.9 | ||||||||||||||||||
Sponsor(1) |
10,991,667 | 7.1 | 10,991,667 | 7.5 | 10,991,667 | 7.9 | ||||||||||||||||||
Eligible Navitas Equityholders |
95,000,000 | 61.2 | 95,000,000 | 64.5 | 95,000,000 | 68.1 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 10.0 | 15,500,000 | 10.5 | 15,500,000 | 11.1 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
155,225,001 | 100.00 | 147,325,001 | 100.00 | 139,425,001 | 100.00 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. Also includes 1,500,000 shares underlying private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination — Sponsor Letter Amendment” and “The Business Combination — Backstop Agreement” for more information. |
Q: |
Why is LOKB proposing the amendments to the Charter set forth in the Charter Proposals? |
A: | LOKB is proposing amendments to the Charter to approve certain items required to effectuate the Business Combination and other matters the LOKB Board believes are appropriate for the operation of LOKB, including to, among other things, (a) increase the number of authorized shares of LOKB’s capital stock, par value $0.0001 per share, from 111,000,000 shares, consisting of (i) 110,000,000 shares of LOKB Common Stock, including 100,000,000 shares of Class A Common Stock and 10,000,000 shares of Class B Common Stock and (ii) 1,000,000 shares of LOKB Preferred Stock, to shares, consisting of (A) shares of common stock and (B) shares of preferred stock, and (b) to make certain other changes that the LOKB Board deems appropriate for a public operating company, including (i) eliminating certain provisions relating to an Initial Business Combination that will no longer be applicable to LOKB following the Closing, including provisions relating to (A) redemption rights with respect to Class A Common Stock, (B) the Trust Account, (C) share issuances prior to the consummation of the Initial Business Combination, (D) transactions with affiliates and other blank check companies, (E) approval of the Initial Business Combination and (F) the minimum value of the target in the Initial Business Combination and (ii) to change the post-combination company’s name to “Navitas Semiconductor Corporation”. Under the Charter and Delaware law, stockholder approval is required in order to effect the Charter Proposals. See the section entitled “Proposal Nos. 2–3 — The Charter Proposals” for additional information. |
Q: |
Why is LOKB proposing the PIPE Proposal? |
A: | LOKB is proposing the PIPE Proposal in order to comply with NYSE listing rules, which require stockholder approval of certain transactions that result in the issuance of 20% or more of a company’s outstanding voting power or shares of common stock outstanding before the issuance of stock or securities. In connection with the Business Combination and the PIPE Financing, we may issue up to an aggregate of 15,500,000 shares of Class A Common Stock to the Navitas Shareholders, the Eligible Navitas Equityholders and the PIPE Investors. Because we may issue 20% or more of our outstanding voting power and outstanding common stock in connection with the Business Combination and the PIPE Financing, we are required to obtain stockholder approval of such issuances pursuant to NYSE listing rules. See the section entitled “Proposal No. 4 — The PIPE Proposal” for additional information. |
Q: |
Did the LOKB Board obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Business Combination? |
A: | No. The LOKB Board did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the Business Combination. LOKB’s officers and directors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and concluded that their experience and backgrounds, together with the experience and sector expertise of LOKB’s advisors, enabled them to make the necessary analyses and determinations regarding the Business Combination. In addition, LOKB’s officers, directors and advisors have substantial experience with mergers and acquisitions. Accordingly, investors will be relying solely on the judgment of the LOKB Board in valuing Navitas and assuming the risk that the LOKB Board may not have properly valued the business. |
Q: |
What happens if I sell my shares of Class A Common Stock before the special meeting? |
A: | The record date for the special meeting is earlier than the date that the Business Combination is expected to be completed. If you transfer your shares of Class A Common Stock after the record date, but before the special meeting, unless the transferee obtains from you a proxy to vote those shares, you will retain your right to vote at the special meeting. However, you will not be able to seek redemption of your shares of Class A Common Stock because you will no longer be able to deliver them for cancellation upon consummation of the Business Combination in accordance with the provisions described in this proxy statement/prospectus. If you transfer your shares of Class A Common Stock prior to the record date, you will have no right to vote those shares at the special meeting or seek redemption of those shares. |
Q: |
How has the announcement of the Business Combination affected the trading price of LOKB’s units, Class A Common Stock and warrants? |
A: | On May 6, 2021, the last trading date before the public announcement of the Business Combination, LOKB’s public units, Class A Common Stock and public warrants closed at $10.36, $10.03 and $1.51, respectively. On , 2021 the trading date immediately prior to the date of this proxy statement/prospectus, LOKB’s public units, Class A Common Stock and warrants closed at $ , $ and $ , respectively. |
Q: |
Following the Business Combination, will LOKB’s securities continue to trade on a stock exchange? |
A: | Yes. We have applied to begin the listing of our Class A Common Stock and public warrants on NASDAQ under the new symbols “NVTS” and “NVTSW,” respectively, following the Closing. We anticipate that the Class A Common Stock and warrants of the post-combination company will cease trading on the NYSE at the end of the trading day on which Closing occurs and will commence trading on NASDAQ at the beginning of the trading day immediately following the day on which the Closing occurs. |
Q: |
What vote is required to approve the Proposals presented at the special meeting? |
A: | Approval of each of the Business Combination Proposal, the PIPE Proposal, the 2021 Plan Proposal and the Adjournment Proposal requires the affirmative vote (online or by proxy) of the holders of a majority of the shares of Class A Common Stock and Class B Common Stock entitled to vote and actually cast thereon, voting as a single class. Approval of the Authorized Share Charter Proposal requires the affirmative vote (online or by proxy) of (i) the holders of a majority of the shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class, and (ii) the holders of a majority of the shares of Class A Common Stock entitled to vote thereon at the special meeting, voting as a single class. Approval of the Additional Charter Proposal requires the affirmative vote (online or by |
proxy) of the holders of a majority of the shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class. Approval of the Director Election Proposal requires the affirmative vote (online or by proxy) of a plurality of the votes cast by holders of shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class. |
Q: |
May our Sponsor or LOKB’s directors, officers, advisors or any of their respective affiliates purchase public shares in connection with the Business Combination? |
A: | In connection with the stockholder vote to approve the proposed Business Combination, our Sponsor, directors, officers, advisors or any of their respective affiliates may privately negotiate transactions to purchase public shares from stockholders who would have otherwise elected to have their shares redeemed in conjunction with a proxy solicitation pursuant to the proxy rules for a per share pro rata portion of the Trust Account. There is no limit on the number of public shares our Sponsor, directors, officers, advisors or any of their respective affiliates may purchase in such transactions, subject to compliance with applicable law and the rules of the NYSE. Any such privately negotiated purchases may be effected at purchase prices that are in excess of the per share pro rata portion of the Trust Account. However, our Sponsor, directors, officers, advisors and their respective affiliates have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the Trust Account will be used to purchase public shares in such transactions. Our Sponsor, directors, officers, advisors and their respective affiliates will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller of such public shares or during a restricted period under Regulation M under the Exchange Act. Such a purchase could include a contractual acknowledgement that such stockholder, although still the record holder of such public shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights, and could include a contractual provision that directs such stockholder to vote such shares in a manner directed by the purchaser. In the event that our Sponsor, directors, officers, advisors or any of their respective affiliates purchase public shares in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. Any such privately negotiated purchases may be effected at purchase prices that are in excess of the per share pro rata portion of the Trust Account. |
Q: |
How many votes do I have at the special meeting? |
A: | Our stockholders are entitled to one vote at the special meeting for each share of Class A Common Stock or Class B Common Stock held of record as of , 2021, the record date for the special meeting. As of the close of business on the record date, there were 25,300,000 outstanding shares of Class A Common Stock, which are held by our public stockholders, and 6,325,000 outstanding shares of Class B Common Stock, which are held by our Sponsor. |
Q: |
What constitutes a quorum at the special meeting? |
A: | Holders of a majority in voting power of Class A Common Stock and Class B Common Stock issued and outstanding and entitled to vote at the special meeting, virtually present or represented by proxy, constitute a quorum. In the absence of a quorum, the chairman of the meeting has the power to adjourn the special meeting. As of the record date for the special meeting, 15,812,501 shares of Class A Common Stock and |
Class B Common Stock, in the aggregate, would be required to achieve a quorum. Abstentions will count as present for the purposes of establishing a quorum with respect to each Proposal. |
Q: |
How will our Sponsor and LOKB’s directors and officers vote? |
A: | Our Sponsor, directors and officers have agreed to vote any shares of Class A Common Stock and Class B Common Stock owned by them in favor of the Business Combination. Currently, they own approximately 20.0% of our issued and outstanding shares of Class A Common Stock and Class B Common Stock, in the aggregate. |
Q: |
What interests do the current officers and directors have in the Business Combination? |
A: | When you consider the LOKB Board’s recommendation of the Proposals, you should keep in mind that our directors and officers have interests in the Business Combination that are different from, or in addition to, those of other stockholders generally. Our directors were aware of and considered these interests, among other matters, in evaluating the Business Combination, and in recommending to stockholders that they approve the Business Combination. In certain instances, the LOKB Board had the conflicted transactions approved by the audit committee of the board in accordance with LOKB’s related party transaction policy. These interests may have influenced the members of the LOKB Board in making their recommendation that you vote in favor of the approval of the Business Combination. Stockholders should take these interests into account in deciding whether to approve the Business Combination. See the subsection entitled “The Business Combination — Interests of Certain Persons in the Business Combination” for additional information. The LOKB Board was aware of and considered these interests, among other matters, in recommending that LOKB stockholders vote “FOR” each of the Proposals. These interests include, among other things: |
• | the fact that our Sponsor holds 4,666,667 private placement warrants that would expire worthless if a business combination is not consummated; |
• | the fact that our Sponsor, officers and directors have agreed not to redeem any of the shares of LOKB Common Stock held by them in connection with a stockholder vote to approve the Business Combination; |
• | the fact that our Sponsor paid an aggregate of $25,000 for the Founders Stock and that such securities will have a significantly higher value at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2021; |
• | if the Trust Account is liquidated, including in the event we are unable to complete an Initial Business Combination within the required time period, our Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per public share, or such lesser amount per public share as is in the Trust Account on the liquidation date, by the claims of (a) any third party (other than our independent registered public accounting firm) for services rendered or products sold to us or (b) a prospective target business with which we have entered into a letter of intent, confidentiality or other similar agreement or business combination agreement, but only if such a third party or target business has not executed a waiver of all rights to seek access to the Trust Account and except as to any claims under LOKB’s indemnity of its underwriters against certain liabilities; |
• | the fact that each of our officers and directors hold a direct or indirect interest in our Sponsor, which interest will be worthless unless a business combination is consummated; |
• | the fact that previous investors with Live Oak Merchant Partners have been committed to invest $14.5 million in the PIPE Financing; |
• | the fact that our Sponsor, officers and directors will not be reimbursed for any loans extended, fees due or out-of-pocket |
• | the fact that our Sponsor and its affiliates can earn a positive rate of return on their investment, even if other LOKB shareholders experience a negative rate of return in the post-business combination company; and |
• | the fact that our Sponsor, officers and directors will lose their entire investment in us if an Initial Business Combination is not completed. At the closing of the Business Combination, we anticipate that our Sponsor will hold 4,666,667 private placement warrants and 6,325,000 shares of Founders Stock. In addition, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds to finance transaction costs in connection with an Initial Business Combination. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.50 per warrant at the option of the lender. The warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. While no such loans are outstanding as of the date of this proxy statement/prospectus, we anticipate that our Sponsor may provide a loan to us prior to the Closing. While no assurances can be made as to the ultimate amount of this loan, we believe that the principal amount of the loan could be approximately $50,000 to $150,000. Our ability to repay this loan (either in cash or, at our Sponsor’s election, through the conversion of the loan into private placement warrants as described above) is dependent upon the completion of an Initial Business Combination. |
Security |
Total Capital Contribution |
Value as of , 2021 |
||||||
Private placement warrants(1) |
$ | 7,000,000 | $ |
|||||
Founders Stock(2) |
$ | 25,000 | $ |
(1) | Includes 1,500,000 private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination—Backstop Agreement” for more information. |
(2) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. See “The Business Combination—Sponsor Letter Amendment” for more information. |
Name |
Position |
Total Capital Contribution |
Value as of , 2021 (1) |
|||||||
John P. Amboian |
Chairman | $ | 750,000 | $ |
||||||
Richard J. Hendrix |
Chief Executive Officer and Director | $ | 475,000 | $ |
||||||
Andrea Tarbox |
Chief Financial Officer and Director | $ | 300,000 | $ |
||||||
Gary K. Wunderlich, Jr. |
President | $ | 475,000 | $ |
||||||
Adam Fishman |
Chief Operating Officer | $ | 400,000 | $ |
||||||
Jon Furer |
Director | $ | 450,000 | $ |
||||||
Tor Braham |
Director | $ | 450,000 | $ |
(1) | Includes the value of 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. Also includes the value of 1,500,000 private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination—Sponsor Letter Amendment” and “The Business Combination—Backstop Agreement” for more information. |
Q: |
What happens if I vote against the Business Combination Proposal? |
A: | Under our Charter, if the Business Combination Proposal is not approved and we do not otherwise consummate an alternative business combination by December 7, 2022, we will be required to dissolve and liquidate the Trust Account by returning the then-remaining funds in such account to our public stockholders. |
Q: |
Do I have redemption rights? |
A: | If you are a holder of public shares, you may elect to have your public shares redeemed for cash at the applicable redemption price per share equal to the quotient obtained by dividing (a) the aggregate amount on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, including interest not previously released to us to pay our taxes, by (b) the total number of then outstanding shares of Class A Common Stock included as part of the units sold in the IPO; provided that we will not redeem any public shares to the extent that such redemption would result in LOKB having net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act ) of less than $5,000,001. A public stockholder, together with any of his, her or its affiliates or any other person with whom it is acting in concert or as a “group” (as defined under Section 13(d)(3) of the Exchange Act), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 20% of the public shares (the “20% threshold”). Unlike some other blank check companies, other than the net tangible asset requirement and the 20% threshold described above, we have no specified maximum redemption threshold and there is no other limit on the number of public shares that you can redeem. Holders of our outstanding public warrants do not have redemption rights in connection with the Business Combination. Our Sponsor, officers and directors have agreed to waive their redemption rights with respect to any shares of our common stock they may hold in connection with the consummation of the Business Combination. For illustrative purposes, based on the fair value of cash and marketable securities held in the Trust Account as of June 30, 2021 of approximately $253.1 million, the estimated per share redemption price would have been approximately $10.00. Additionally, shares properly tendered for redemption will only be redeemed if the Business Combination is consummated; otherwise holders of such shares will only be entitled to a pro rata portion of the Trust Account (including interest but net of taxes payable) (a) in connection with a stockholder vote to approve an amendment to our Charter that would affect the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an Initial Business Combination by December 7, 2022, (b) in connection with the liquidation of the Trust Account or (c) if we subsequently complete a different business combination on or before December 7, 2022. |
Q: |
Will how I vote affect my ability to exercise redemption rights? |
A: | No. You may exercise your redemption rights whether you vote your shares of Class A Common Stock for or against or abstain from voting on the Business Combination Proposal or any other proposal described in this proxy statement/prospectus. As a result, the Business Combination can be approved by stockholders who will redeem their shares and no longer remain stockholders. |
Q: |
How do I exercise my redemption rights? |
A: | In order to exercise your redemption rights, you must (a) if you hold your shares of Class A Common Stock through units, elect to separate your units into the underlying public shares and public warrants prior to exercising your redemption rights with respect to the public shares and (b) prior to 5:00 p.m., Eastern time, on , 2021 (two business days before the special meeting), tender your shares physically or electronically and submit a request in writing that we redeem your public shares for cash to Continental Stock Transfer & Trust Company, our transfer agent, at the following address: |
Q: |
What are the U.S. federal income tax consequences of (i) exercising my redemption rights in connection with the transaction and (ii) holding Class A Common Stock or Navitas Shares at the time of the consummation of the Business Combination? |
A: | The U.S. federal income tax consequences of a redemption in connection with the transaction depend on a holder’s particular facts and circumstances. For a discussion of the material U.S. federal income tax considerations relating to a redemption of our Class A Common Stock or holding Class A Common Stock or Navitas Shares at the time of the consummation of the Business Combination, see the subsection entitled “The Business Combination — Material U.S. Federal Income Tax Considerations.” We urge you to consult your tax advisors regarding the tax consequences of exercising your redemption rights, remaining a holder of our Class A Common Stock or holding Navitas Shares at the time of the consummation of the Business Combination. |
Q: |
What are the Irish capital gains tax consequences of holding Navitas Ireland Shares at the time of the consummation of the Business Combination? |
A: | For a discussion of the material Irish capital gains tax consequences relating to holding Navitas Ireland Shares at the time of the consummation of the Business Combination, see the subsection entitled “The Business Combination — Material Irish Capital Gains Tax Consequences.” We urge you to consult your tax advisors regarding the tax consequences of holding Navitas Ireland Shares at the time of the consummation of the Business Combination. |
Q: |
If I am a warrant holder, can I exercise redemption rights with respect to my warrants? |
A: | No. The holders of our warrants have no redemption rights with respect to our warrants. |
Q: |
Do I have appraisal rights if I object to the proposed Business Combination? |
A: | No. There are no appraisal rights available to holders of Class A Common Stock or Class B Common Stock in connection with the Business Combination. |
Q: |
What happens to the funds deposited in the Trust Account after consummation of the Business Combination? |
A: | If the Business Combination Proposal is approved, we intend to use a portion of the funds held in the Trust Account to pay (a) any LOKB Transaction Costs, (b) tax obligations and deferred underwriting discounts and commissions from the IPO and (c) for any redemptions of public shares. The remaining balance in the Trust Account, together with the proceeds from the PIPE Financing, will be used for general corporate purposes of LOKB. See the section entitled “The Business Combination” for additional information. |
Q: |
What happens if the Business Combination is not consummated or is terminated? |
A: | There are certain circumstances under which the Business Combination Agreement may be terminated. See the subsection entitled “The Business Combination — Termination” for additional information regarding |
the parties’ specific termination rights. In accordance with our Charter, if an Initial Business Combination is not consummated by December 7, 2022, we will (a) cease all operations except for the purpose of winding up, (b) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest earned on the funds held in the Trust Account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then-outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), and (c) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and the LOKB Board, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. |
Q: |
When is the Business Combination expected to be consummated? |
A: | It is currently anticipated that the Business Combination will be consummated promptly following the special meeting of our stockholders to be held on , 2021, provided that all the requisite stockholder approvals are obtained and other conditions to the consummation of the Business Combination have been satisfied or waived. For a description of the conditions for the completion of the Business Combination, see the subsection entitled “The Business Combination — Conditions to Closing of the Business Combination Agreement.” |
Q: |
What do I need to do now? |
A: | You are urged to read carefully and consider the information included in this proxy statement/prospectus, including the section entitled “Risk Factors” and the annexes attached to this proxy statement/prospectus, and to consider how the Business Combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus and on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker, bank or nominee. |
Q: |
How do I vote? |
A: | If you were a holder of record of Class A Common Stock or Class B Common Stock on , 2021, the record date for the special meeting, you may vote with respect to the Proposals online at the virtual special meeting or by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided. If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or other nominee, you should follow the instructions provided by your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the record holder of your shares with instructions on how to vote your shares or, if you wish to virtually attend the special meeting and vote online, obtain a proxy from your broker, bank or nominee. |
Q: |
What will happen if I abstain from voting or fail to vote at the special meeting? |
A: | At the special meeting, we will count a properly executed proxy marked “ABSTAIN” with respect to a particular proposal as present for purposes of determining whether a quorum is present. For purposes of approval, failure to vote or an abstention will have no effect on the Business Combination Proposal, the PIPE Proposal, the 2021 Plan Proposal, the Director Election Proposal or the Adjournment Proposal, but will have the same effect as a vote AGAINST the Charter Proposals. |
Q: |
What will happen if I sign and submit my proxy card without indicating how I wish to vote? |
A: | Signed and dated proxies received by us without an indication of how the stockholder intends to vote on a proposal will be voted “FOR” each Proposal (or in the case of the Director Election Proposal, “FOR ALL NOMINEES”) being submitted to a vote of the stockholders at the special meeting. |
Q: |
If I am not going to attend the virtual special meeting online, should I submit my proxy card instead? |
A: | Yes. Whether you plan to attend the special meeting or not, please read the enclosed proxy statement/prospectus carefully, and vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided. |
Q: |
If my shares are held in “street name,” will my broker, bank or nominee automatically vote my shares for me? |
A: | No. Under the rules of various national and regional securities exchanges, your broker, bank or nominee cannot vote your shares with respect to non-discretionary matters unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank or nominee. We believe the Proposals presented to our stockholders will be considered non-discretionary and therefore your broker, bank or nominee cannot vote your shares without your instruction. Your bank, broker or other nominee can vote your shares only if you provide instructions on how to vote. You should instruct your broker to vote your shares in accordance with directions you provide. |
Q: |
May I change my vote after I have submitted my executed proxy card? |
A: | Yes. You may change your vote by sending a later-dated, signed proxy card to us at the address listed below so that it is received by us prior to the special meeting or by attending the virtual special meeting online and voting there. You also may revoke your proxy by sending a notice of revocation to us, which must be received prior to the special meeting. |
Q: |
What should I do if I receive more than one set of voting materials? |
A: | You may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus and multiple proxy cards or voting instruction forms. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction form for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction form that you receive in order to cast your vote with respect to all of your shares. |
Q: |
Who can help answer my questions? |
A: | If you have questions about the Proposals or if you need additional copies of the proxy statement/prospectus or the enclosed proxy card you should contact our proxy solicitor at: (800) 662-5200. |
Q: |
Who will solicit and pay the cost of soliciting proxies? |
A: | The LOKB Board is soliciting your proxy to vote your shares of Class A Common Stock and Class B Common Stock on all matters scheduled to come before the special meeting. We will pay the cost of soliciting proxies for the special meeting. We have engaged Morrow Sodali LLC to assist in the solicitation of proxies for the special meeting. We have agreed to pay Morrow Sodali LLC a fee of $32,500, plus disbursements. We will reimburse Morrow Sodali LLC for reasonable out-of-pocket |
• | LOKB will consummate the Tender Offer and acquire 100% of each class of then issued and allotted Navitas Ireland Shares, excluding the Navitas Ireland Restricted Shares issued pursuant to the 2020 Equity Incentive Plan (whether pursuant to the Tender Offer, the compulsory acquisition procedure provided under Section 457 of the Companies Act 2014 of Ireland or otherwise) promptly after the expiration time of the Tender Offer; provided |
• | each Navitas Delaware Share (other than certain Navitas Delaware Restricted Shares which are addressed below) issued and outstanding immediately prior to the Closing, will be canceled and converted into the right to receive (a) the number of shares of Class A Common Stock equal to the Navitas Delaware Exchange Ratio and (b) the contingent right to receive the applicable Earnout Shares, in each case, without interest; |
• | all Navitas Delaware Common Shares and Navitas Delaware Preferred Shares held in the treasury of Navitas Delaware, if any, will be canceled without any conversion thereof and no payment or distribution will be made with respect thereto; |
• | each share of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time will be converted into and exchanged for one validly issued, fully paid and nonassessable limited liability company interest of the entity surviving the Merger; |
• | each Navitas Option that is outstanding immediately prior to the Closing will be released and extinguished in exchange for (a) an option to purchase a number of shares of Class A Common Stock equal to the product of (x) the number of Navitas Delaware Common Shares or Navitas Ireland Common Shares subject to such Navitas Delaware or Navitas Ireland Option and (y) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Options, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Options, in each case, at an exercise price per share equal to (1) the exercise price per share of such Navitas Delaware Option or Navitas Ireland Option immediately prior to the Closing, divided by (2) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Options, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Options and (b) the contingent right to receive Earnout Shares; |
• | each Navitas Restricted Share that is outstanding immediately prior to the Closing will be released and extinguished in exchange for (a) an award of a number of restricted shares of Class A Common Stock equal to the product of (y) the number of Navitas Delaware Restricted Shares or Navitas Ireland Restricted Shares subject to such award and (z) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Restricted Shares, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Restricted Shares (which award will remain subject to the same vesting and repurchase terms as such Navitas Delaware Restricted Shares or Navitas Ireland Restricted Shares) and (b) the contingent right to receive Earnout Shares; |
• | each Navitas Restricted Stock Unit that is outstanding immediately prior to the Closing will be released and extinguished in exchange for (a) an award of a number of restricted stock units (to be settled in shares of Class A Common Stock) equal to the product of (y) the number of Navitas Delaware Restricted Stock Units or Navitas Ireland Restricted Stock Units subject to such award and (z) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Restricted Stock Units, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Restricted Stock Units (which award will remain subject to the same vesting and repurchase terms as such Navitas Delaware Restricted Stock Units or Navitas Ireland Restricted Stock Units) and (b) the contingent right to receive Earnout Shares; and |
• | each Navitas Warrant that is outstanding immediately prior to the Closing will be released and extinguished in exchange for (a) a warrant to purchase a number of shares of A Common Stock equal to the product of (x) the number of Navitas Delaware Common Shares or Navitas Delaware Preferred Shares or Navitas Ireland Common Shares or Navitas Ireland Preferred Shares subject to such Navitas Delaware Warrant or Navitas Ireland Warrant and (y) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Warrants, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Warrants, at an exercise price per share equal to (1) the exercise price per share of such Navitas Delaware Warrant or Navitas Ireland Warrant divided by (2) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Warrants, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Warrants, and (b) the contingent right to receive Earnout Shares. |
• | the written consent of the requisite shareholders of Navitas Delaware in favor of the approval and adoption of the Business Combination Agreement and the Business Combination; |
• | the Business Combination Proposal, the Charter Proposals, the PIPE Proposal, the 2021 Plan Proposal and the Director Election Proposal having each been approved and adopted by the requisite affirmative |
vote of the LOKB stockholders in accordance with the Delaware General Corporation Law, LOKB’s organizational documents and the rules and regulations of the NYSE; |
• | the offers made pursuant to the Tender Offer for shares of Navitas Ireland having been accepted in respect of shares of Navitas Ireland representing at least 80% of each class of then issued and allotted shares of Navitas Ireland and any dissenting shareholders of Navitas Ireland being required to transfer their shares of Navitas Ireland to LOKB as a result of the Tender Offer (pursuant to the compulsory acquisition procedure provided under Section 457 of the Companies Act 2014 of Ireland) (such that upon the consummation of the Tender Offer, LOKB will have acquired 100% of each class of then issued and allotted shares of Navitas Ireland); |
• | no governmental authority having enacted, issued, promulgated, enforced or entered any law, rule, regulation, judgment, decree, executive order or award which is then in effect and has the effect of making the Business Combination illegal or otherwise prohibiting the consummation of the Business Combination; |
• | all required filings under the HSR Act and any other applicable antitrust laws having been completed and any applicable waiting period (and any extension thereof) applicable to the consummation of the Business Combination under the HSR Act and any other applicable antitrust laws having expired or been terminated; |
• | the Registration Statement having been declared effective and no stop order suspending the effectiveness of the Registration Statement being in effect, and no proceedings for purposes of suspending the effectiveness of the Registration Statement having been initiated or threatened by the SEC; and |
• | the shares of Class A Common Stock to be issued pursuant to the Business Combination Agreement (including the Earnout Shares) and in connection with the consummation of the Tender Offer having been approved for listing on a national securities exchange, as of the Closing, subject only to official notice of issuance thereof. |
• | the accuracy of the representations and warranties of Navitas as determined in accordance with the Business Combination Agreement; |
• | Navitas having performed or complied in all material respects with all agreements and covenants required by the Business Combination Agreement to be performed or complied with by it at or prior to the Effective Time; |
• | no Navitas Material Adverse Effect (as defined below) having occurred following the date of the Business Combination Agreement that is continuing and uncured; |
• | receipt of resignations from the members of the governing bodies of Navitas and its subsidiaries except for the persons identified as continuing directors; |
• | Navitas having delivered a certification that the equity interests of Navitas are not “United States real property interests”; |
• | LOKB having at least $5,000,001 of net tangible assets following the redemption of public shares by LOKB’s public stockholders in accordance with LOKB’s organizational documents; |
• | the sale and issuance by LOKB of Class A Common Stock in connection with the PIPE Financing having been consummated prior to or in connection with the Closing; |
• | new employment agreements with certain executives being in full force and effect; |
• | each Navitas Warrant having been terminated, exercised (and any shares of Navitas Ireland received upon such exercise being tendered into the Tender Offer) or amended in the manner permitted by the Business Combination Agreement, provided that this condition will not apply to any Navitas Warrant that is unvested (and not reasonably expected by Navitas to become vested in accordance with its terms) and represents a de minimis amount of the outstanding equity of Navitas immediately prior to Closing; and |
• | Navitas having delivered a certificate signed by an officer of Navitas, certifying as to the satisfaction of these conditions. |
• | LOKB having at least $250,000,000 in available cash (including proceeds in connection with the PIPE Financing and the funds in the Trust Account and after taking into account payments required to satisfy redemptions of public shares by LOKB’s public stockholders); |
• | the accuracy of the representations and warranties of LOKB and Merger Sub as determined in accordance with the Business Combination Agreement; |
• | each of LOKB and Merger Sub having performed or complied in all material respects with all agreements and covenants required by the Business Combination Agreement to be performed or complied with by it on or prior to the Effective Time; |
• | no LOKB Material Adverse Effect having occurred following the date of the Business Combination Agreement that is continuing and uncured; |
• | LOKB having made all necessary and appropriate arrangements with Continental Stock Transfer & Trust Company to have all of the funds held in the Trust Account disbursed to LOKB immediately prior to the Effective Time, and all such funds released from the Trust Account being available to LOKB in respect of all or a portion of the payment obligations set forth in the Business Combination Agreement and the payment of LOKB’s fees and expenses incurred in connection with the Business Combination Agreement and the Business Combination; and |
• | LOKB having delivered a certificate signed by an officer of LOKB, certifying as to the satisfaction of these conditions. |
• | Continuing Officers and Directors |
Name |
Title | |
Gene Sheridan | Chief Executive Officer | |
Daniel Kinzer | Chief Technology Officer and Chief Operating Officer |
• | In addition, the following individuals who are currently directors of Navitas are expected to become members of the post-combination company board upon the completion of the Business Combination: Gene Sheridan, Daniel Kinzer, Brian Long, Dipender Saluja and David Moxam. |
• | the fact that our Sponsor holds 4,666,667 private placement warrants that would expire worthless if a Business Combination is not consummated; |
• | the fact that our Sponsor, officers and directors have agreed not to redeem any of the shares of our common stock held by them in connection with a stockholder vote to approve the Business Combination; |
• | the fact that our Sponsor paid an aggregate of $25,000 for the Founders Stock, and that such securities will have a significantly higher value at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2021; |
• | if the Trust Account is liquidated, including in the event we are unable to complete an Initial Business Combination within the required time period, our Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per public share, or such lesser amount per public share as is in the Trust Account on the liquidation date, by the claims of (a) any third party (other than our independent registered public accounting firm) for services rendered or products sold to us or (b) a prospective target business with which we have entered into a letter of intent, confidentiality or other similar agreement or business combination agreement, but only if such a third party or target business has not executed a waiver of all rights to seek access to the Trust Account and except as to any claims under LOKB’s indemnity of its underwriters against certain liabilities; |
• | the fact that our each of our officers and directors hold a direct or indirect interest in our Sponsor, which interest will be worthless unless a business combination is consummated; |
• | the fact that Richard J. Hendrix and Gary Wunderlich will continue as members of the post-combination board and will be eligible to participate under the 2021 Plan; |
• | the fact that previous investors with Live Oak Merchant Partners have been committed to invest $14.5 million in the PIPE Financing; |
• | the fact that our Sponsor, officers and directors will not be reimbursed for any loans extended, fees due or out-of-pocket expenses incurred in connection with activities on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations unless a business combination is consummated, although no such amounts require reimbursement as of the date of this proxy statement/prospectus; |
• | the fact that our Sponsor and its affiliates can earn a positive rate of return on their investment, even if other LOKB shareholders experience a negative rate of return in the post-business combination company; and |
• | the fact that our Sponsor, officers and directors will lose their entire investment in us if an Initial Business Combination is not completed. At the closing of the Business Combination, we anticipate that our Sponsor will hold 4,666,667 private placement warrants and 6,325,000 shares of Founders Stock. In addition, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds to finance transaction costs in connection with an Initial Business Combination. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.50 per warrant at the option of the lender. The warrants would be identical to the private placement warrants, including as to exercise price, |
exercisability and exercise period. While no such loans are outstanding as of the date of this proxy statement/prospectus, we anticipate that our Sponsor may provide a loan to us prior to the Closing. While no assurances can be made as to the ultimate amount of this loan, we believe that the principal amount of the loan could be approximately $50,000 to $150,000. Our ability to repay this loan (either in cash or, at our Sponsor’s election, through the conversion of the loan into private placement warrants as described above) is dependent upon the completion of an Initial Business Combination. |
Security |
Total Capital Contribution |
Value as of , 2021 |
||||||
Private placement warrants(1) |
$ | 7,000,000 | $ |
|||||
Founders Stock(2) |
$ | 25,000 | $ |
(1) | Includes 1,500,000 private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination—Backstop Agreement” for more information. |
(2) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. See “The Business Combination—Sponsor Letter Amendment” for more information. |
Name |
Position |
Total Capital Contribution |
Value as of , 2021 (1) |
|||||||
John P. Amboian |
Chairman | $ | 750,000 | $ |
||||||
Richard J. Hendrix |
Chief Executive Officer and Director | $ | 475,000 | $ |
||||||
Andrea Tarbox |
Chief Financial Officer and Director | $ | 300,000 | $ |
||||||
Gary K. Wunderlich, Jr. |
President | $ | 475,000 | $ |
||||||
Adam Fishman |
Chief Operating Officer | $ | 400,000 | $ |
||||||
Jon Furer |
Director | $ | 450,000 | $ |
||||||
Tor Braham |
Director | $ | 450,000 | $ |
(1) | Includes the value of 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. Also includes the value of 1,500,000 private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination—Sponsor Letter Amendment” and “The Business Combination—Backstop Agreement” for more information. |
• | Business Highlights. |
• | Competitive Positioning |
• | Due Diligence |
• | Financial Condition Certain Navitas Projected Financial Information |
• | Attractive Market Valuation of Comparable Companies |
• | GaN Semiconductor Peers : |
• | Integrated Semiconductor Peers : |
• | AutoTech / Semi SPAC Peers : |
• | Experienced and Proven Management Team |
• | Other Alternatives |
• | Negotiated Transaction |
• | Macroeconomic Risks |
• | Redemption Risk |
• | Stockholder Vote |
• | Closing Conditions |
• | Litigation |
• | Benefits May Not Be Achieved |
• | No Third-Party Valuation |
• | LOKB Stockholders Receiving a Minority Positions |
• | Interests of LOKB’s Directors and Officers Interests of LOKB’s Directors and Officers in the Business Combination |
• | Other Risks Factors Risk Factors |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
25,300,000 | 17.8 | 17,400,000 | 13.0 | 9,500,000 | 7.5 | ||||||||||||||||||
Sponsor(1) |
6,325,000 | 4.5 | 6,325,000 | 4.7 | 6,325,000 | 5.0 | ||||||||||||||||||
Eligible Navitas Equityholders(2)(3) |
95,000,000 | 66.8 | 95,000,000 | 70.8 | 95,000,000 | 75.2 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 10.9 | |
15,500,000 |
|
11.5 | |
15,500,000 |
|
12.3 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
142,125,000 | 100.00 | 134,225,000 | 100.00 | 134,225,000 | 100.00 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | LOKB Class A Common Stock owned upon conversion of shares of Founders Stock and, in the case of our Sponsor, includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. |
(2) | Includes (x) the up to approximately 78,300,000 shares of our Class A Common Stock anticipated to be issued to Navitas Shareholders and (y) the up to approximately 16,700,000 shares of our Class A Common Stock anticipated to be reserved for issuance in respect of (i) LOKB options issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Options, (ii) LOKB restricted stock issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Shares, (iii) LOKB restricted stock units issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Stock Units and (iv) LOKB warrants issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Warrants, in each case that may be exercised at a later date. |
(3) | Excludes (i) the reduction in the aggregate number of shares of Class A Common Stock issuable under the Business Combination Agreement based on the estimated stamp duty, as such amount will not be known with certainty until immediately prior to Closing, and (ii) the potential issuance of the Earnout Shares to the Eligible Navitas Equityholders. During the Earnout Period, we may issue to Eligible Navitas Equityholders up to 10,000,000 additional shares of Class A Common Stock in the aggregate in three equal tranches upon the satisfaction of price targets of $12.50, $17.00 or $20.00, which price targets are based upon the volume-weighted average closing sale price of one share of Class A Common Stock quoted on the exchange on which the shares of Class A Common Stock are then traded, for any 20 trading days within any 30 consecutive trading day period during the Earnout Period, or upon certain change of control transactions that imply a per share value that would satisfy the price targets. |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
33,733,334 | 21.7 | 25,833,334 | 17.5 | 17,933,334 | 12.9 | ||||||||||||||||||
Sponsor(1) |
10,991,667 | 7.1 | 10,991,667 | 7.5 | 10,991,667 | 7.9 | ||||||||||||||||||
Eligible Navitas Equityholders |
95,000,000 | 61.2 | 95,000,000 | 64.5 | 95,000,000 | 68.1 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 10.0 | 15,500,000 | 10.5 | 15,500,000 | 11.1 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
155,225,001 | 100.00 | 147,325,001 | 100.00 | 139,425,001 | 100.00 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. Also includes 1,500,000 shares underlying private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination — Sponsor Letter Amendment” and “The Business Combination — Backstop Agreement” for more information. |
|
LOKB Shares of Class A Common Stock | |||||
Historical | ||||||
May 6, 2021 |
$ | 10.03 |
• | The cyclical nature of the semiconductor industry may limit Navitas’ ability to maintain or improve its net sales and profitability. |
• | Navitas’ business could be materially and adversely affected by the current global COVID-19 pandemic or other health epidemics and outbreaks. |
• | The semiconductor industry is highly competitive. If Navitas is not able to compete successfully, its business, financial results and future prospects will be harmed. |
• | A significant portion of Navitas’ net sales is generated through end customers in China which subjects Navitas to risks associated with changes of Chinese end customer interest and governmental or regulatory changes. |
• | If Navitas fails in a timely and cost-effective manner to develop new product features or new products that address end customer preferences and achieve market acceptance, Navitas’ operating results could be adversely affected. |
• | If Navitas fails to accurately anticipate and respond to rapid technological change in the industries in which Navitas operates, Navitas’ ability to attract and retain end customers could be impaired and its competitive position could be harmed. |
• | Navitas is dependent on a limited number of distributors and end customers. The loss of, or a significant disruption in the relationships with any of these distributors or end customers, could significantly reduce Navitas’ revenue and adversely impact Navitas’ operating result. In addition, If Navitas is unable to expand or further diversify its end customer base, its business, financial condition, and results of operations could suffer. |
• | Navitas’ success and future revenue depends on its ability to achieve design wins and to convince Navitas’ current and prospective end customers to design its products into their product offerings. If Navitas does not continue to win designs or its products are not designed into its end customers’ product offerings, Navitas’ results of operations and business will be harmed. |
• | Reliability is especially critical in the power semiconductor industry, and any adverse reliability result by Navitas with any of its end customers could negatively affect Navitas’ business, financial condition, and results of operations. |
• | The complexity of Navitas’ products could result in unforeseen delays or expenses from undetected defects, errors or bugs in hardware or software which could reduce the market adoption of Navitas’ products, damage its reputation with current or prospective end customers and adversely affect its operating costs. |
• | Navitas relies on a single third-party wafer fabrication facility for the fabrication of semiconductor wafers and on a limited number of suppliers of other materials, and the failure of this facility or any of these suppliers or additional suppliers to continue to produce wafers or other materials on a timely basis could harm Navitas’ business and its financial results. |
• | Navitas relies on its relationships with industry and technology leaders to enhance Navitas’ product offerings and its inability to continue to develop or maintain such relationships in the future would harm Navitas’ ability to remain competitive. |
• | Navitas is subject to risks and uncertainties associated with international operations, which may harm its business. |
• | Navitas is a tax resident of, and is subject to tax in, both the United States and Ireland. While Navitas intends to pursue relief from double taxation under the double tax treaty between the United States and Ireland, there can be no assurance that such efforts will be successful. Accordingly, the status of Navitas as a tax resident in the U.S. and Ireland may result in an increase in its cash tax obligations and effective tax rate, which increase may be material. |
• | Our Sponsor, officers and directors have agreed to vote in favor of the business combination, regardless of how our public stockholders vote. |
• | The consummation of the Business Combination is subject to a number of conditions and if those conditions are not satisfied or waived, the Business Combination Agreement may be terminated in accordance with its terms and the Business Combination may not be completed. |
• | Legal proceedings in connection with the Business Combination, the outcomes of which are uncertain, could delay or prevent the completion of the Business Combination. |
• | The LOKB Board did not obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Business Combination. |
• | A significant portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future. This could cause the market price of our Class A Common Stock to drop significantly, even if our business is doing well. |
• | Our stockholders will have a reduced ownership and voting interests after the Business Combination and will exercise less influence over management. |
• | reduced sales of Navitas end customers’ products; |
• | the effects of catastrophic and other disruptive events at Navitas’ end customers’ offices or facilities including, but not limited to, natural disasters, telecommunications failures, cyber-attacks, terrorist attacks, pandemics, epidemics or other outbreaks of infectious disease, including the current COVID-19 pandemic, breaches of security or loss of critical data; |
• | increased costs associated with potential disruptions to Navitas’ end customers’ supply chain and other manufacturing and production operations; |
• | the deterioration of Navitas’ end customers’ financial condition; |
• | delays and project cancellations as a result of design flaws in the products developed by Navitas’ end customers; |
• | the inability of end customers to dedicate the resources necessary to promote and commercialize their products; |
• | the inability of Navitas’ end customers to adapt to changing technological demands resulting in their products becoming obsolete; and |
• | the failure of Navitas’ end customers’ products to achieve market success and gain broad market acceptance. |
• | timely and efficient completion of process design and device structure improvements; |
• | timely and efficient implementation of manufacturing, assembly, and test processes; |
• | the ability to secure and effectively utilize fabrication capacity in different geometries; |
• | product performance; |
• | product availability; |
• | product quality and reliability; and |
• | effective marketing, sales and service. |
• | changing end customer requirements, resulting in an extended development cycle for the product; |
• | delay in the ramp-up of volume production of the customer’s products into which Navitas’ solutions are designed; |
• | delay or cancellation of the customer’s product development plans; |
• | competitive pressures to reduce Navitas’ selling price for the product; |
• | the discovery of design flaws, defects, errors or bugs in the products; |
• | lower than expected end customer acceptance of the solutions designed for the customer’s products; |
• | lower than expected acceptance of Navitas’ end customers’ products; and |
• | higher manufacturing costs than anticipated. |
• | international economic and political conditions and other political tensions between countries in which Navitas does business |
• | unexpected changes in, or impositions of, legislative or regulatory requirements, including changes in tax laws; |
• | restrictions on cross-border investment, including enhanced oversight by the Committee on Foreign Investment in the United States (“CFIUS”) and substantial restrictions on investment from China; |
• | differing legal standards with respect to protection of intellectual property and employment practices; |
• | local business and cultural factors that differ from Navitas’ normal standards and practices, including business practices that Navitas is prohibited from engaging in by the U.S. Foreign Corrupt Practices Act of 1977 (“FCPA”) and other anticorruption laws and regulations; |
• | exporting or importing issues related to export or import restrictions, including deemed export restrictions, tariffs, quotas and other trade barriers and restrictions; and |
• | disruptions of capital and trading markets and currency fluctuations. |
• | failure to identify, attract, reward, and retain people in leadership positions in its organization who share and further its culture, values and mission; |
• | the increasing size and geographic diversity of its workforce; |
• | competitive pressures to move in directions that may divert Navitas from its mission, vision, and values; |
• | the continued challenges of a rapidly-evolving industry; and |
• | the increasing need to develop expertise in new areas of business that affect Navitas. |
• | the rescheduling, increase, reduction or cancellation of significant end customer orders; |
• | the timing of end customer qualification of Navitas’ products and commencement of volume sales by Navitas’ end customers of systems that include its products; |
• | the timing and amount of research and development and sales and marketing expenditures; |
• | the rate at which Navitas’ present and future end customers and end users adopt Navitas’ technologies in Navitas’ target end markets; |
• | the timing and success of the introduction of new products and technologies by Navitas and its competitors, and the acceptance of Navitas’ new products by its end customers; |
• | Navitas’ ability to anticipate changing end customer product requirements; |
• | Navitas’ gain or loss of one or more key end customers; |
• | the availability, cost and quality of materials and components that Navitas purchases from third- party vendors and any problems or delays in the fabrication, assembly, testing or delivery of its products; |
• | the availability of production capacity at Navitas’ third-party wafer fabrication facility or other third-party subcontractors and other interruptions in the supply chain, including as a result of materials shortages, bankruptcies or other causes; |
• | supply constraints for and changes in the cost of the other components incorporated into Navitas’ end customers’ products; |
• | Navitas’ ability to reduce the manufacturing costs of its products; |
• | fluctuations in manufacturing yields; |
• | the changes in Navitas’ product mix or end customer mix; |
• | competitive pressures resulting in lower than expected ASPs; |
• | the timing of expenses related to the acquisition of technologies or businesses; |
• | product rates of return or price concessions in excess of those expected or forecasted; |
• | the emergence of new industry standards; |
• | product obsolescence; |
• | unexpected inventory write-downs or write-offs; |
• | costs associated with litigation over intellectual property rights and other litigation; |
• | the length and unpredictability of the purchasing and budgeting cycles of Navitas’ end customers; |
• | loss of key personnel or the inability to attract qualified engineers; |
• | the quality of Navitas’ products and any remediation costs; |
• | adverse changes in economic conditions in various geographic areas where Navitas or its end customers do business; |
• | the general industry conditions and seasonal patterns in Navitas’ target end markets; |
• | other conditions affecting the timing of end customer orders or Navitas’ ability to fill orders of end customers subject to export control or U.S. economic sanctions; and |
• | geopolitical events, such as war, threat of war or terrorist actions, or the occurrence of pandemics, epidemics or other outbreaks of disease, including the current COVID-19 pandemic, or natural disasters, and the impact of these events on the factors set forth above. |
• | discontinue selling, importing or using certain technologies that contain the allegedly infringing intellectual property which could cause Navitas to stop manufacturing certain products; |
• | seek to develop non-infringing technologies, which may not be feasible; |
• | incur significant legal expenses; |
• | pay substantial monetary damages to the party whose intellectual property rights Navitas may be found to be infringing; and/or |
• | Navitas or its end customers could be required to seek licenses to the infringed technology that may not be available on commercially reasonable terms, if at all. |
• | the fact that our Sponsor holds 4,666,667 private placement warrants that would expire worthless if a Business Combination is not consummated; |
• | the fact that our Sponsor, officers and directors have agreed not to redeem any of the shares of our common stock held by them in connection with a stockholder vote to approve the Business Combination; |
• | the fact that our Sponsor paid an aggregate of $25,000 for the Founders Stock, and that such securities will have a significantly higher value at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2021; |
• | if the Trust Account is liquidated, including in the event we are unable to complete an Initial Business Combination within the required time period, our Sponsor has agreed to indemnify us to ensure that the |
proceeds in the Trust Account are not reduced below $10.00 per public share, or such lesser amount per public share as is in the Trust Account on the liquidation date, by the claims of (a) any third party (other than our independent registered public accounting firm) for services rendered or products sold to us or (b) a prospective target business with which we have entered into a letter of intent, confidentiality or other similar agreement or business combination agreement, but only if such a third party or target business has not executed a waiver of all rights to seek access to the Trust Account and except as to any claims under LOKB’s indemnity of its underwriters against certain liabilities; |
• | the fact that our each of our officers and directors hold a direct or indirect interest in our Sponsor, which interest will be worthless unless a business combination is consummated; |
• | the fact that previous investors with Live Oak Merchant Partners have been committed to invest $14.5 million in the PIPE Financing; |
• | the fact that our Sponsor, officers and directors will not be reimbursed for any loans extended, fees due or out-of-pocket expenses incurred in connection with activities on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations unless a business combination is consummated, although no such amounts require reimbursement as of the date of this proxy statement/prospectus; |
• | the fact that our Sponsor and its affiliates can earn a positive rate of return on their investment, even if other LOKB shareholders experience a negative rate of return in the post-business combination company; and |
• | the fact that our Sponsor, officers and directors will lose their entire investment in us if an Initial Business Combination is not completed. At the closing of the Business Combination, we anticipate that our Sponsor will hold 4,666,667 private placement warrants and 6,325,000 shares of Founders Stock. In addition, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds to finance transaction costs in connection with an Initial Business Combination. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.50 per warrant at the option of the lender. The warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. While no such loans are outstanding as of the date of this proxy statement/prospectus, we anticipate that our Sponsor may provide a loan to us prior to the Closing. While no assurances can be made as to the ultimate amount of this loan, we believe that the principal amount of the loan could be approximately $50,000 to $150,000. Our ability to repay this loan (either in cash or, at our Sponsor’s election, through the conversion of the loan into private placement warrants as described above) is dependent upon the completion of an Initial Business Combination. |
Security |
Total Capital Contribution |
Value as of , 2021 |
||||||
Private placement warrants(1) |
$ | 7,000,000 | $ |
|||||
Founders Stock(2) |
$ | 25,000 | $ |
(1) | Includes 1,500,000 private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination—Backstop Agreement” for more information. |
(2) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. See “The Business Combination—Sponsor Letter Amendment” for more information. |
Name |
Position |
Total Capital Contribution |
Value as of , 2021 (1) |
|||||||
John P. Amboian |
Chairman | $ | 750,000 | $ |
||||||
Richard J. Hendrix |
Chief Executive Officer and Director | $ | 475,000 | $ |
||||||
Andrea Tarbox |
Chief Financial Officer and Director | $ | 300,000 | $ |
||||||
Gary K. Wunderlich, Jr. |
President | $ | 475,000 | $ |
||||||
Adam Fishman |
Chief Operating Officer | $ | 400,000 | $ |
||||||
Jon Furer |
Director | $ | 450,000 | $ |
||||||
Tor Braham |
Director | $ | 450,000 | $ |
(1) | Includes the value of 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. Also includes the value of 1,500,000 private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination—Sponsor Letter Amendment” and “The Business Combination—Backstop Agreement” for more information. |
• | may significantly dilute the equity interests of our investors; |
• | may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded our common stock; |
• | could cause a change in control if a substantial number of shares of our common stock is issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; and |
• | may adversely affect prevailing market prices for our units, Class A Common Stock and/or warrants. |
• | a limited availability of market quotations for our securities; |
• | reduced liquidity for our securities; |
• | a determination that our Class A Common Stock is a “penny stock” which will require brokers trading in our Class A Common Stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; |
• | a limited amount of news and analyst coverage; and |
• | a decreased ability to issue additional securities or obtain additional financing in the future. |
• | actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us; |
• | changes in the market’s expectations about our operating results; |
• | success of competitors; |
• | our operating results failing to meet the expectation of securities analysts or investors in a particular period; |
• | changes in financial estimates and recommendations by securities analysts concerning LOKB or the market in general; |
• | operating and stock price performance of other companies that investors deem comparable to us; |
• | our ability to market new and enhanced products and technologies on a timely basis; |
• | changes in laws and regulations affecting our business; |
• | our ability to meet compliance requirements; |
• | commencement of, or involvement in, litigation involving LOKB; |
• | changes in our capital structure, such as future issuances of securities or the incurrence of additional debt; |
• | the volume of shares of our Class A Common Stock available for public sale; |
• | any major change in the LOKB Board or management; |
• | sales of substantial amounts of Class A Common Stock by our directors, executive officers or significant stockholders or the perception that such sales could occur; and |
• | general economic and political conditions such as recessions, interest rates, fuel prices, international currency fluctuations and acts of war or terrorism. |
• | changes in the industries in which the post-combination company and its end customers operate; |
• | developments involving post-combination company’s competitors; |
• | developments involving the post-combination company’s suppliers; |
• | actual or anticipated fluctuations in the post-combination company’s results of operations due to, among other things, changes in end customer demand, product life cycles, pricing, ordering patterns, and unforeseen operating costs; |
• | changes in laws and regulations affecting its business, including export control laws; |
• | variations in its operating performance and the performance of its competitors in general; |
• | actual or anticipated fluctuations in the post-combination company’s quarterly or annual operating results; |
• | publication of research reports by securities analysts about the post-combination company or its competitors or its industry or failure of securities analysts to initiate or maintain coverage of the post-combination company, changes in financial estimates or ratings by any securities analysts who follow the post-combination company, or failure to meet these estimates or the expectations of investors; |
• | the public’s reaction to the post-combination company’s press releases, its other public announcements and its filings with the SEC; |
• | actions by stockholders, including the sale by the third-party PIPE Investors of any of their shares of the post-combination company’s common stock; |
• | additions and departures of executive officers or key personnel; |
• | commencement of litigation involving the post-combination company; |
• | changes in its capital structure, such as future issuances of securities or the incurrence of additional debt; |
• | announcements by significant end customers of changes to their product offerings, business plans, or strategies; |
• | announcements by the post-combination company or its competitors of significant technical innovations, acquisitions, strategic partnerships, joint ventures, or capital commitments |
• | the volume of shares of the post-combination company’s common stock available for public sale; and |
• | general economic and political conditions, such as the effects of the COVID-19 outbreak, recessions, inflation, interest rates, local and national elections, fuel prices, international currency fluctuations, corruption, political instability and acts of war or terrorism. |
• | other events or factors, including those resulting from war, incidents of terrorism, the COVID-19 pandemic or responses to these events. |
• | a classified board of directors with three-year staggered terms, which may have the effect of deferring, delaying or discouraging hostile takeovers, or changes in control of the post-combination company or its management; |
• | no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; |
• | the exclusive right of the post-combination company board to elect a director to fill a vacancy created by, among other things, the expansion of the board of directors or the resignation, death or removal of a director, which prevents stockholders from filling vacancies on the post-combination company board; |
• | the ability of the post-combination company board to authorize the issuance of shares of preferred stock and to determine the terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer; |
• | the ability of the post-combination company board to alter the bylaws without obtaining stockholder approval; |
• | a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of post-combination company stockholders; |
• | the requirement that a special meeting of stockholders may be called only by a majority vote of the post-combination company board, which may delay the ability of the post-combination company stockholders to force consideration of a proposal or for stockholders controlling a majority of our capital stock to take action, including the removal of directors; and |
• | advance notice procedures that stockholders must comply with in order to nominate candidates to the post-combination company board or to propose matters to be acted upon at an annual meeting or special meeting of stockholders, which may discourage or delay a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of the post-combination company until the next stockholder meeting or at all. |
• | the occurrence of any event, change or other circumstances that could delay the Business Combination or give rise to the termination of the Business Combination Agreement; |
• | the outcome of any legal proceedings that have been or may be instituted against LOKB, Navitas or others following announcement of the Business Combination; |
• | the inability to complete the Business Combination due to the failure to obtain approval of the stockholders of LOKB, or satisfy the other conditions to closing in the Business Combination Agreement; |
• | the risk that LOKB may not be able to consummate the PIPE Financing; |
• | the risk that the proposed Business Combination disrupts current plans and operations of Navitas or LOKB as a result of the announcement and consummation of the Business Combination; |
• | LOKB’s ability to realize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition and the ability of LOKB to grow and manage growth profitably following the Business Combination; |
• | costs related to the Business Combination; |
• | LOKB’s success in retaining or recruiting, or changes in, its officers, key employees or directors following the business combination; |
• | the possibility of third-party claims against the Trust Account; |
• | changes in applicable laws or regulations; |
• | the possibility that COVID-19 may hinder LOKB’s or Navitas’ ability to consummate the Business Combination; |
• | the possibility that COVID-19 may adversely affect the results of operations, financial position and cash flows of LOKB, Navitas or LOKB; |
• | technological changes; |
• | data security breaches or other network outages; |
• | Navitas’ ability to remediate its material weaknesses in internal control over financial reporting; and |
• | the possibility that LOKB or the post-combination company may be adversely affected by other economic, business or competitive factors. |
• | the (a) historical audited financial statements of LOKB as of December 31, 2020 and for the period August 12, 2020 through December 31, 2020 and (b) historical unaudited condensed financial statements of LOKB as of and for the six months ended June 30, 2021; |
• | the (a) historical audited consolidated financial statements of Navitas as of and for the years ended December 31, 2020 and December 31, 2019 and (b) historical unaudited condensed consolidated financial statements of Navitas as of and for the six months ended June 30, 2021; and |
• | other information relating to LOKB and Navitas included in this proxy statement/prospectus, including the Business Combination Agreement and the description of certain terms thereof set forth under the section entitled “The Business Combination.” |
Historical |
Assuming No Redemptions |
Assuming Maximum Redemptions |
||||||||||||||||||||||||||||||
LOKB |
Navitas |
5 Pro Forma Adjustments |
Pro Forma Balance Sheet |
Additional Pro Forma Adjustments |
Pro Forma Balance Sheet |
|||||||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||||||||||
Current assets: |
||||||||||||||||||||||||||||||||
Cash and cash equivalents |
$ | 163 | $ | 23,848 | $ | 367,079 | 5(a) | $ | 391,090 | $ | (158,000 | ) | 5(l) | $ | 233,090 | |||||||||||||||||
Accounts receivable, net |
— | 4,501 | — | 4,501 | — | 4,501 | ||||||||||||||||||||||||||
Inventory |
— | 7,924 | — | 7,924 | — | 7,924 | ||||||||||||||||||||||||||
Prepaid expenses and other current assets |
257 | 2,902 | (257 | ) | 5(b) | 2,902 | — | 2,902 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total current assets |
420 | 39,175 | 366,822 | 406,417 | (158,000 | ) | 248,417 | |||||||||||||||||||||||||
Property and equipment, net |
— | 1,180 | — | 1,180 | — | 1,180 | ||||||||||||||||||||||||||
Intangible assets, net |
— | 344 | — | 344 | — | 344 | ||||||||||||||||||||||||||
Notes receivable |
— | 215 | 215 | — | 215 | |||||||||||||||||||||||||||
Other assets and deposits |
— | 223 | — | 223 | — | 223 | ||||||||||||||||||||||||||
Cash and marketable securities held in trust account |
253,079 | — | (253,079 | ) | 5(c) | — | — | — | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total assets |
$ | 253,499 | $ | 41,137 | $ | 113,743 | $ | 408,379 | $ | (158,000 | ) | $ | 250,379 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||||||||||||||||||||||||||
Current liabilities: |
||||||||||||||||||||||||||||||||
Accounts payable and accrued expenses |
$ | 135 | $ | 9,270 | $ | — | 5(n) | $ | 9,405 | $ | — | $ | 9,405 | |||||||||||||||||||
Current debt obligations |
— | 2,200 | — | 2,200 | — | 2,200 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total current liabilities |
135 | 11,470 | — | 11,605 | — | 11,605 | ||||||||||||||||||||||||||
Long-term debt, net of current portion |
— | 3,778 | — | 3,778 | — | 3,778 | ||||||||||||||||||||||||||
Derivative warrant liabilities |
29,475 | — | — | 29,475 | — | 29,475 | ||||||||||||||||||||||||||
Other long-term liabilities |
— | 66 | 54,522 | 5(m) | 54,588 | — | 54,588 | |||||||||||||||||||||||||
Deferred underwriting fee payable |
8,067 | — | (8,067 | ) | 5(d) | — | — | — | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total liabilities |
37,677 | 15,314 | 46,455 | 99,446 | — | 99,446 | ||||||||||||||||||||||||||
LOKB common stock subject to possible redemption |
210,822 | — | (210,822 | ) | 5(e) | — | — | — | ||||||||||||||||||||||||
Navitas Series A convertible preferred shares, $0.0001 par value |
— | 14,970 | (14,970 | ) | 5(f) | — | — | — | ||||||||||||||||||||||||
Navitas Series B convertible preferred shares, $0.0001 par value |
— | 27,371 | (27,371 | ) | 5(f) | — | — | — | ||||||||||||||||||||||||
Navitas Series B-1 convertible preferred shares, $0.0001 par value |
— | 14,786 | (14,786 | ) | 5(f) | — | — | — | ||||||||||||||||||||||||
Navitas Series B-2 convertible preferred shares, $0.0001 par value |
— | 52,379 | (52,379 | ) | 5(f) | — | — | — | ||||||||||||||||||||||||
Shareholders’ Equity: |
||||||||||||||||||||||||||||||||
Navitas common shares, $0.0001 par value |
— | 3 | (3 | ) | 5(g) | — | — | — | ||||||||||||||||||||||||
LOKB Class A common stock, $0.0001 par value |
— | — | — | 5(h) | — | — | — |
Historical |
Assuming No Redemptions |
Assuming Maximum Redemptions |
||||||||||||||||||||||||||||||
LOKB |
Navitas |
5 Pro Forma Adjustments |
Pro Forma Balance Sheet |
Additional Pro Forma Adjustments |
Pro Forma Balance Sheet |
|||||||||||||||||||||||||||
LOKB Class B common stock, $0.0001 par value per share |
1 | — | (1 | ) | 5(h) | — | — | — | ||||||||||||||||||||||||
Surviving Pubco Class A common stock, $0.0001 par value |
— | — | 14 | 5(j) | 14 | (2 | ) | 5(l) | 12 | |||||||||||||||||||||||
Additional paid-in capital |
19,303 | 18,295 | 396,583 | 5(k) | 434,181 | (157,999 | ) | 5(l) | 276,183 | |||||||||||||||||||||||
Accumulated deficit |
(14,304 | ) | (101,977) | (8,977 | ) | 5(b)(i) | (125,258 | ) | — | (125,258 | ||||||||||||||||||||||
Accumulated other comprehensive loss |
— | (4 | ) | — | (4 | ) | — | (4 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total shareholders’ equity attributable to common shareholders |
5,000 | (83,683 | ) | 387,616 | 308,933 | (158,000 | ) | 150,933 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total liabilities, common stock subject to possible redemption, convertible preferred shares and shareholders’ equity |
$ | 253,499 | $ | 41,137 | $ | 113,743 | $ | 408,379 | $ | (158,000 | ) | $ | 250,379 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Historical |
Assuming No Redemptions |
Assuming Maximum Redemptions |
||||||||||||||||||||||||||||||||||
LOKB |
Navitas |
6 Pro Forma Adjustments |
Pro Forma Statement of Operations |
Additional Pro Forma Adjustments |
Pro Forma Statement of Operations |
|||||||||||||||||||||||||||||||
Revenue, net |
$ | — | $ | 10,767 | $ | — | $ | 10,767 | $ | — | $ | 10,767 | ||||||||||||||||||||||||
Cost of goods sold |
— | 5,930 | — | 5,930 | — | 5,930 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Gross profit |
— | 4,837 | — | 4,837 | — | 4,837 | ||||||||||||||||||||||||||||||
Operating expenses: |
||||||||||||||||||||||||||||||||||||
Research and development |
— | 10,521 | 920 | 6(a) | 11,441 | — | 11,441 | |||||||||||||||||||||||||||||
Selling, general, and administrative |
— | 20,163 | 1,764 | |
6(a), 6(d) |
|
21,927 | — | 21,927 | |||||||||||||||||||||||||||
Formation costs and other operating expenses |
1,610 | — | — | 1,610 | — | 1,610 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Total operating expenses |
1,610 | 30,684 | 2,684 | 34,978 | — | 34,978 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Loss from operations |
(1,610 | ) | (25,847 | ) | (2,684 | ) | (30,141 | ) | — | (30,141 | ) | |||||||||||||||||||||||||
Other income (expense), net: |
||||||||||||||||||||||||||||||||||||
Interest income |
64 | 3 | (64 | ) | 6(b) | 3 | — | 3 | ||||||||||||||||||||||||||||
Interest expense |
— | (127 | ) | — | (127 | ) | — | (127 | ) | |||||||||||||||||||||||||||
Other income (expense), net |
(9,039 | ) | — | — | (9,039 | ) | — | (9,039 | ) | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Total other income (expense), net |
(8,975 | ) | (124 | ) | (64 | ) | (9,163 | ) | — | (9,163 | ) | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Income (loss) before income taxes |
(10,585 | ) | (25,971 | ) | (2,748 | ) | (39,304 | ) | — | (39,304 | ) | |||||||||||||||||||||||||
Income tax expense |
(24 | ) | — | (24 | ) | — | (24 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Net income (loss) |
$ | (10,585 | ) | $ | (25,995 | ) | $ | (2,748 | ) | $ | (39,328 | ) | $ | — | $ | (39,328 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Weighted average shares outstanding of Class A redeemable common stock |
25,300 | 18,571 | — | 126,153 | 6(c) | — | 110,353 | 6(c) | ||||||||||||||||||||||||||||
Basic and diluted net loss per share, Class A redeemable common stock |
$ | — | $ | (1.40 | ) | $ | — | $ | (0.31 | ) | 6(c) | $ | — | $ | (0.36 | ) | 6(c) | |||||||||||||||||||
Weighted average shares outstanding of Class B non-redeemable common stock |
6,325 | — | — | — | 6(c) | — | — | 6(c) | ||||||||||||||||||||||||||||
Basic and diluted net income per share, Class B non-redeemable common stock |
$ | (1.67 | ) | $ | — | $ | — | $ | — | 6(c) | $ | — | $ | — | 6(c) |
Historical |
Assuming No Redemptions |
Assuming Maximum Redemptions | ||||||||||||||||||||||||||||
LOKB |
Navitas |
6 Pro Forma Adjustments |
Pro Forma Statement of Operations |
Additional Pro Forma Adjustments |
Pro Forma Statement of Operations |
|||||||||||||||||||||||||
Revenue, net |
$ | — | $ | 11,849 | $ | — | $ | 11,849 | $ | — | $ | 11,849 | ||||||||||||||||||
Cost of goods sold |
— | 8,134 | — | 8,134 | — | 8,134 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Gross profit |
— | 3,715 | — | 3,715 | — | 3,715 | ||||||||||||||||||||||||
Operating expenses: |
||||||||||||||||||||||||||||||
Research and development |
— | 13,049 | 3,136 | 6(a) | 16,185 | — | 16,185 | |||||||||||||||||||||||
Selling, general, and administrative |
— | 9,469 | 2,276 | 6(a) | 11,745 | — | 11,745 | |||||||||||||||||||||||
Formation costs and other operating expenses |
137 | — | 8,720 | 6(d), (e) | 8,857 | — | 8,857 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total operating expenses |
137 | 22,518 | 14,132 | 36,787 | — | 36,787 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Loss from operations |
(137 | ) | (18,803 | ) | (14,132 | ) | (33,072 | ) | — | (33,072 | ) | |||||||||||||||||||
Other income (expense), net: |
||||||||||||||||||||||||||||||
Interest income |
19 | 4 | (19 | ) | 6(b) | 4 | — | 4 | ||||||||||||||||||||||
Interest expense |
— | (240 | ) | — | (240 | ) | — | (240 | ) | |||||||||||||||||||||
Other income (expense), net |
(3,601 | ) | — | — | (3,601 | ) | — | (3,601 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total other income (expense), net |
(3,582 |
) |
(236 |
) |
(19 |
) |
|
(3,837 |
) |
— |
(3,837 |
) |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Income (loss) before income taxes |
(3,719 | ) | (19,039 | ) | (14,151 | ) | (36,909 | ) | — | (36,909 | ) | |||||||||||||||||||
Income tax expense |
— | (5 | ) | — | (5 | ) | — | (5 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net income loss |
$ | (3,719 | ) | $ | (19,044 | ) | $ | (14,151 | ) | $ | (36,914 | ) | $ | — | $ | (36,914 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Weighted average shares outstanding of Class A redeemable common stock |
25,300 | 14,847 | — | 114,676 | 6(c) | — | 98,876 | 6(c) | ||||||||||||||||||||||
Basic and diluted net loss per share, Class A redeemable common stock |
$ | — | $ | (1.28 | ) | $ | — | $ | (0.32 | ) | 6(c) | $ | — | $ | (0.37 | ) | 6(c) | |||||||||||||
Weighted average shares outstanding of Class B non-redeemable common stock |
5,645 | — | — | — | 6(c) | — | — | 6(c) | ||||||||||||||||||||||
Basic and diluted net loss per share, Class B non-redeemable common stock |
$ | (0.66 | ) | $ | — | $ | — | $ | — | 6(c) | $ | — | $ | — | 6(c) |
• | Assuming No Redemptions: |
• | Assuming Maximum Redemptions: per-share Redemption Price of $10.00. |
• | the (i) audited historical financial statements of LOKB for the period from August 12, 2020 (inception) through December 31, 2020 and (ii) unaudited historical condensed financial statements of LOKB as of and for the six months ended June 30, 2021 and the related notes, in each case, included elsewhere in this proxy statement/prospectus; |
• | the (i) audited historical consolidated financial statements of Navitas for the year ended December 31, 2020 and (ii) unaudited historical condensed consolidated financial statements of Navitas as of and for the six months ended June 30, 2021 and the related notes, in each case, included elsewhere in this proxy statement/prospectus; and |
• | the sections entitled “ Management’s Discussion and Analysis of Financial Condition and Results of Operations of LOKB Management’s Discussion and Analysis of Financial Condition and Results of Operations of Navitas, |
• | The former owners of Navitas hold the largest portion of voting rights in the combined company; |
• | Navitas has the right to appoint a majority of the directors in the combined company; |
• | Navitas’ existing senior management team will comprise senior management of the combined company; |
• | The operations of the combined company will represent the operations of Navitas; |
• | The combined company will assume Navitas’ name and headquarters. |
Assuming No Redemptions |
Assuming Maximum Redemptions (1) |
|||||||||||||||
Shares |
% |
Shares |
% |
|||||||||||||
Equity Capitalization Summary |
||||||||||||||||
Navitas Equityholders (2) |
95,000,000 | 66.8 | % | 95,000,000 | 75.2 | % | ||||||||||
LOKB Public Shareholders |
25,300,000 | 17.8 | % | 9,500,000 | 7.5 | % | ||||||||||
LOKB Sponsor (3) |
6,325,000 | 4.5 | % | 6,325,000 | 5.0 | % | ||||||||||
PIPE Investors (4) |
15,500,000 | 10.9 | % | 15,500,000 | 12.3 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Class A common stock of Surviving Company |
142,125,000 | 100.0 | % | 126,325,000 | 100.0 | % | ||||||||||
|
|
|
|
|
|
|
|
(1) | Assumes Redemptions of 15,800,000 shares of Class A Common Stock for aggregate Redemption payments of $158 million using a per-share Redemption Price of $10.00 (assuming no investment related gains in the Trust Account). |
(2) | Includes (x) the up to approximately 78,300,000 shares of our Class A Common Stock anticipated to be issued to Navitas Shareholders and (y) the up to approximately 16,700,000 shares of our Class A Common Stock anticipated to be reserved for issuance in respect of (i) LOKB options issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Options, (ii) LOKB restricted stock issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Shares, (iii) LOKB restricted stock units issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Stock Units and (iv) LOKB warrants issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Warrants, in each case that may be exercised at a later date. |
(3) | Assumes the 1,265,000 shares of Class A Common Stock that will be subject to forfeiture in accordance with the Sponsor Letter Amendment are treated as if owned by the Sponsor, although they will be held subject to forfeiture and cancellation by the Company. |
(4) | Assumes the PIPE Financing is consummated in accordance with its terms for $155 million, with 15,500,000 shares of Class A Common Stock issued to the PIPE Investors. |
(a) | To reflect the net cash proceeds from the Business Combination and the PIPE Financing as follows: |
Release of Trust Account |
$ | 253,079 | 5 | (c) | ||||
Payment of LOKB deferred underwriting fee payable |
(8,067 | ) | 5 | (d) | ||||
Payment of other transaction expenses |
(32,933 | ) | 5 | (i) | ||||
Proceeds from PIPE Financing (see Note 1 above) |
155,000 | 5 | (k) | |||||
|
|
|||||||
Cash and cash equivalents |
$ | 367,079 | ||||||
|
|
(b) | To reflect the reclassification of $257 of transaction expense prepaid by LOKB to accumulated deficit upon completion of the Business Combination. |
(c) | To reflect the release of $253,079 from the Trust Account (see Note 5(a)). |
(d) | To reflect the settlement of $8,067 of deferred underwriting fees incurred during LOKB’s IPO that are contractually due upon completion of the Business Combination (see Note 5(a)). |
(e) | Assuming no shares of Class A Common Stock are redeemed, the LOKB shares of Class A Common Stock subject to possible redemption of $210,822 would be transferred to permanent equity (see Note 5(k)). |
(f) | To reflect the recapitalization of the combined company through the exchange of Navitas redeemable convertible preferred stock for common stock of the post-combination company. |
(g) | To reflect the recapitalization of the combined company through the exchange of Navitas common stock for common stock of post-combination company. |
(h) | To reflect the recapitalization of the combined company through the exchange of LOKB common stock for the common stock of post-combination company. |
(i) | To reflect the payment of estimated transaction expenses of $32,933, net of $8,067 of deferred underwriting fees, from proceeds released from the Trust Account and proceeds from the PIPE Financing (see Note 5(a)). Of the $32,933, transaction expenses totaling $24,213 represent incremental costs directly attributable to the Business Combination and PIPE Financing and as such, are charged against the proceeds of the transaction, while $8,720 represent financial advisory fees incurred by LOKB that are not considered to be offering costs and are reflected as an adjustment to expenses in the year ended December 31, 2020. |
(j) | To reflect the reclassification from additional paid in capital to par value of common stock for 142,125,000 shares of post-combination company at $0.0001. |
(k) | To reflect the recapitalization of the combined company through the exchange of all the share capital of LOKB and Navitas for common stock of post-business combination LOKB and the following equity transactions: |
Reclassification of common stock subject to possible redemption |
$ | 210,822 | 5 | (e) | ||||
Reclassification of Navitas’ redeemable convertible preferred shares to permanent equity |
109,506 | 5 | (f) | |||||
Reclassification of post-combination company common stock par value |
(14 | ) | 5 | (j) | ||||
Proceeds from PIPE Financing (see Note 1 above) |
155,000 | 5 | (a) | |||||
Reclassification of Navitas’ ordinary shares par value to additional paid in capital. |
3 | 5 | (g) | |||||
Reclassification of LOKB common stock par value to additional paid in capital. |
1 | 5 | (h) | |||||
Payments of estimated transaction expenses |
(24,213 | ) | 5 | (i) | ||||
Reclassification of contingent consideration from additional paid in capital. |
(54,522 | ) | 5 | (m) | ||||
|
|
|||||||
Total shareholders’ equity |
$ | 396,583 | ||||||
|
|
(l) | Assumes the redemption of 15,800,000 shares of Class A Common Stock for $158,000, which is the maximum Redemption amount after which there is at least $250,000 remaining in the Trust Account before expenses, and after giving effect to any Redemptions and the PIPE Financing, LOKB has at least $250,000 in cash and cash equivalents. |
(m) | To record a contingent consideration liability for the fair value of the Earnout Shares attributable to non-employee equityholders. The Company assessed the Earnout and has concluded that the Earnout Shares for non-employees (estimated to be approximately 7,233,000 shares) will be classified as a liability and measured at fair value with changes in fair value recorded in current earnings. The portion of the Earnout related to Navitas Employee equityholders (estimated to be 2,767,000 shares), which is subject to vesting, will be accounted for under ASC 718 for classification and measurement – see Note 6(a). The Company determined the fair value of the Earnout Shares as of May 28, 2021, assuming a closing date of November 2, 2021, to be $7.54 per share using the Monte Carlo simulation method. The fair value is based on the simulated price of the Company under twenty thousand scenarios over the five-year maturity date of the contingent consideration. The key inputs used in the determination of the fair value included exercise prices of $12.50, $17.00 and $20.00, volatility of 50% (based on the implied volatility of 13 comparable public companies), LOKB common share price of $9.90, and a risk-free rate of return of 0.89%. Based on the LOKB common share price of $9.92 as of June 30, 2021, and the use of the five-year average volatilities, the Company believes that the estimated fair value of the Earnout Shares calculated as of June 30, 2021 would not be meaningfully different from the value as of May 25, 2021. Post-combination, the fair value of the contingent consideration liability will be remeasured each reporting period and changes in value will be reflected in net income (loss). For every $1 change in the per share fair value of the Earnout Shares, the contingent consideration liability will change by approximately $7.2 million. Please see Business Combination, Earnout included elsewhere in this proxy statement/prospectus for additional information about the Earnout. |
(n) | The Stamp Duty Amount will be an obligation of LOKB equal to 1% of the value of the transferred Navitas Ireland shares (at the time of transfer), which is payable in the tax year in which the transfer occurs. The estimated stamp duty is excluded from the pro forma financial statements as such amount will not be known with certainty until immediately prior to Closing. Based on the Company’s current good faith estimate of the market value of the outstanding Navitas Ireland Shares, the stamp duty is estimated to be approximately $5 million. However, the estimated stamp duty amount is based on an assumption of the value of the transferred Navitas Ireland Shares at the time of the transfer, which is subject to change based on the actual value of the Navitas Shares at the time of the consummation of the business combination and the amount of such value that is allocable to the Navitas Ireland Shares versus the Navitas Delaware Shares. As a result, the actual amount of the stamp duty could vary from the foregoing estimation and is subject to change to the extent the value of the Navitas Ireland Shares is adjusted. If included in the pro forma financial statements, the Stamp Duty Amount would be reflected as an accrued liability and a reduction of shareholders equity as of June 30, 2021. |
(a) | To record share-based compensation expense related to Earnout Shares attributable to Eligible Company Employee equityholders, based on the estimated fair value of the Earnout at the Closing, amortized for the respective vesting periods of each statement of operations presented herein, as if vesting began January 1, 2020. The expense adjustment is allocated between selling, general and administrative expense and research and development expense based on the relative allocation of operating expenses between the two categories for each of the respective periods presented because the Company has not yet performed an allocation of the Earnout Shares to individual employees. As of June 30, 2021, unrecognized compensation expense of $12.5 million is expected to be recognized over a weighted average period of 1.86 years. |
(b) | To eliminate interest income and unrealized gains earned on the Trust Account which will be released upon closing of the Business Combination. |
(c) | The pro forma basic and diluted earnings per share amounts presented in the unaudited pro forma condensed combined statements of operations are based upon the number of post-business combination LOKB shares of Class A Common Stock outstanding at the closing of the Business Combination and the PIPE Financing assuming they each occurred on January 1, 2020. For the issuance of additional shares in connection with the Business Combination, the calculations assume the shares were outstanding at the beginning of the periods presented. When assuming redemptions, the calculations are adjusted to eliminate such shares for the entire periods. As the unaudited pro forma condensed combined statements of operations are in a loss position, anti-dilutive instruments were not included in the calculation of diluted weighted average number of common shares outstanding (see Note 4(a) above). |
(In thousands) |
Six months ended June 30, 2021 |
Year ended December 31, 2020 |
||||||
Warrants to purchase common shares (Navitas Warrants) |
1,283 | 1,283 | ||||||
Stock options potentially exercisable for common shares |
10,844 | 11,860 | ||||||
Shares underlying public warrants of LOKB |
8,433 | 8,433 | ||||||
Shares underlying private placement warrants of LOKB |
4,667 | 4,667 | ||||||
|
|
|
|
|||||
25,227 | 26,243 |
(d) | The Stamp Duty Amount will be an obligation of LOKB equal to 1% of the value of the transferred Navitas Ireland shares (at the time of transfer), which is payable in the tax year in which the transfer occurs. The estimated stamp duty is excluded from the pro forma financial statements as such amount will not be known with certainty until immediately prior to Closing. However, the estimated stamp |
duty amount is based on an assumption of the value of the transferred Navitas Ireland Shares at the time of the transfer, which is subject to change based on the actual value of the Navitas Shares at the time of the consummation of the business combination and the amount of such value that is allocable to the Navitas Ireland Shares versus the Navitas Delaware Shares. As a result, the actual amount of the stamp duty could vary from the foregoing estimation and is subject to change to the extent the value of the Navitas Ireland Shares is adjusted. If included in the pro forma financial statements, the Stamp Duty Amount would be reflected as an expense in the pro forma income statement for the year ended December 31. |
(e) | To reflect the payment of estimated transaction expenses of $8,720, which represent financial advisory fees incurred by LOKB that are not considered to be offering costs and are reflected as an adjustment to expenses in the year ended December 31, 2020. |
• | Assuming No Redemptions Scenario — this scenario assumes that no shares of Class A Common Stock are redeemed; and |
• | Assuming Maximum Redemptions Scenario — this scenario assumes that 15,800,000 shares of Class A Common Stock are redeemed for an aggregate payment of $158.0 million, which is derived from the number of shares that could be redeemed in connection with the Business Combination at an assumed redemption price of $10.00 per share based on the Trust Account balance as of June 30, 2021 in order for the amount of LOKB Cash to satisfy the minimum amount required to consummate the Business Combination of at least $250 million after giving effect to the PIPE Financing and payments required to satisfy redemptions of public shares by LOKB’s public stockholders. |
LOKB (Historical) |
Navitas (Historical) |
Pro Forma Adjustments |
Pro Forma Statement of Operations (Assuming No Redemptions) |
Additional Pro Forma Adjustments |
Pro Forma Statement of Operations (Assuming Maximum Redemptions) |
|||||||||||||||||||
(in thousands, except per share amounts) |
||||||||||||||||||||||||
As of and for the Six Months ended June 30, 2021 |
||||||||||||||||||||||||
Weighted average shares outstanding of Class A redeemable common stock |
25,300 | 18,571 | — | 126,153 | — | 110,353 | ||||||||||||||||||
Basic and diluted net loss per share, Class A redeemable common stock |
$ | — | $ | (1.40 | ) | $ | — | $ | (0.31 | ) | $ | — | $ | (0.36 | ) | |||||||||
Weighted average shares outstanding of Class B non-redeemable common stock |
6,325 | — | — | — | — | — | ||||||||||||||||||
Basic and diluted net loss per share, Class B non-redeemable common stock |
$ | (1.67 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
As of and for the Year ended December 31, 2020 |
||||||||||||||||||||||||
Weighted average shares outstanding of Class A redeemable common stock |
25,300 | 14,847 | — | 114,676 | — | 98,876 | ||||||||||||||||||
Basic and diluted net loss per share, Class A redeemable common stock |
$ | — | $ | (1.28 | ) | $ | — | $ | (0.32 | ) | $ | — | $ | (0.37 | ) | |||||||||
Weighted average shares outstanding of Class B non-redeemable common stock |
5,645 | — | — | — | — | — | ||||||||||||||||||
Basic and diluted net loss per share, Class B non-redeemable common stock |
$ | (0.66 | ) | $ | — | $ | — | $ | — | $ | — | $ | — |
• | You can vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided. If you hold your shares in “street name” through a bank, broker or other nominee, you will need to follow the instructions provided to you by your bank, broker or other nominee to ensure that your shares are represented and voted at the special meeting. If you vote by proxy card, your “proxy,” whose name is listed on the proxy card, will vote your shares as you instruct on the proxy card. If you sign and return the proxy card but do not give instructions on how to vote your shares, your shares of Class A Common Stock or Class B Common Stock will be voted “FOR” the Business Combination Proposal, “FOR” the Charter Proposals, “FOR” the PIPE Proposal, “FOR” the 2021 Plan Proposal, “FOR ALL NOMINEES” in the Director Election Proposal and “FOR” the Adjournment Proposal. |
• | You can attend the special meeting virtually and vote online even if you have previously voted by submitting a proxy pursuant to any of the methods noted above. However, if your shares of Class A Common Stock or Class B Common Stock are held in the name of your broker, bank or other nominee, you must get a proxy from the broker, bank or other nominee. That is the only way we can be sure that the broker, bank or nominee has not already voted your shares of Class A Common Stock or Class B Common Stock. |
• | If your shares of Class A Common Stock or Class B Common Stock are held in the name of your broker, bank or other nominee, and you would like to join and not vote, Continental Stock Transfer & Trust Company will issue you a guest control number. You must contact Continental Stock Transfer & Trust Company for specific instructions on how to receive the control number. Continental Stock Transfer & Trust Company can be contacted at the number specified above. Please allow up to 72 hours prior to the meeting for processing your control number. |
• | you may send another proxy card with a later date; |
• | you may notify our secretary, in writing, before the special meeting that you have revoked your proxy; or |
• | you may attend the special meeting virtually, revoke your proxy and vote online, as indicated above. |
• | if you hold your shares of Class A Common Stock through units, elect to separate your units into the underlying public shares and public warrants prior to exercising your redemption rights with respect to the public shares; |
• | certify to LOKB whether you are acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act) with any other stockholder with respect to shares of Class A Common Stock; |
• | prior to 5:00 p.m., Eastern time, on , 2021 (two business days before the special meeting), tender your shares physically or electronically and submit a request in writing that we redeem your public shares for cash to Continental Stock Transfer & Trust Company, our transfer agent, to the attention to the attention of Mark Zimkind at 1 State Street, 30th Floor, New York, New York 10004, by email at [email protected] or by telephone at (212) 509-4000; and |
• | deliver your shares of Class A Common Stock either physically or electronically through DTC to the transfer agent at least two business days before the special meeting. Stockholders seeking to exercise their redemption rights and opting to deliver physical certificates should allot sufficient time to obtain physical certificates from the transfer agent and time to effect delivery. It is our understanding that stockholders should generally allot at least two weeks to obtain physical certificates from the transfer agent. However, we do not have any control over this process and it may take longer than two weeks. Stockholders who hold their shares in street name will have to coordinate with their bank, broker or other nominee to have the shares certificated or delivered electronically. If you do not submit a written request and deliver your shares of Class A Common Stock as described above, your shares will not be redeemed. |
• | LOKB will consummate the Tender Offer and acquire 100% of each class of then issued and allotted Navitas Ireland Shares, excluding the Navitas Ireland Restricted Shares (whether pursuant to the Tender Offer, the compulsory acquisition procedure provided under Section 457 of the Companies Act 2014 of Ireland or otherwise) promptly after the expiration time of the Tender Offer; provided |
• | at the Effective Time, by virtue of the Merger and without any action on the part of LOKB, Merger Sub, Navitas or the holders of any of Navitas’ securities: |
• | each Navitas Delaware Share (other than certain Navitas Delaware Restricted Shares which are addressed below) issued and outstanding immediately prior to the Closing, will be canceled and converted into the right to receive (a) the number of shares of Class A Common Stock equal to the Navitas Delaware Exchange Ratio and (b) the contingent right to receive the applicable Earnout Shares, in each case, without interest; |
• | all Navitas Delaware Common Shares and Navitas Delaware Preferred Shares held in the treasury of Navitas Delaware, if any, will be canceled without any conversion thereof and no payment or distribution will be made with respect thereto; and |
• | each share of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time will be converted into and exchanged for one validly issued, fully paid and nonassessable limited liability company interest of the entity surviving the Merger; |
• | each Navitas Option that is outstanding immediately prior to the Closing will be released and extinguished in exchange for (a) an option to purchase a number of shares of Class A Common Stock equal to the product of (x) the number of Navitas Delaware Common Shares or Navitas Ireland Common Shares subject to such Navitas Delaware Option or Navitas Ireland Option and (y) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Options, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Options, in each case, at an exercise price per share equal to (1) the exercise price per share of such Navitas Delaware Option or Navitas Ireland Option immediately prior to the Closing, divided by (2) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Options, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Options and (b) the contingent right to receive Earnout Shares; |
• | each Navitas Restricted Share that is outstanding immediately prior to the Closing will be released and extinguished in exchange for (a) an award of a number of restricted shares of Class A Common Stock equal to the product of (y) the number of Navitas Delaware Restricted Shares or Navitas Ireland Restricted Shares subject to such award and (z) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Restricted Shares, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Restricted Shares (which award will remain subject to the same vesting and repurchase terms as such Navitas Delaware Restricted Shares or Navitas Ireland Restricted Shares) and (b) the contingent right to receive Earnout Shares; |
• | each Navitas Restricted Stock Unit that is outstanding immediately prior to the Closing will be released and extinguished in exchange for (a) an award of a number of restricted stock units (to be settled in shares of Class A Common Stock) equal to the product of (y) the number of Navitas Delaware Restricted Stock Units or Navitas Ireland Restricted Stock Units subject to such award and (z) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Restricted Stock Units, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Restricted Stock Units (which award will remain subject to the same vesting and repurchase terms as such Navitas Delaware Restricted Stock Units or Navitas Ireland Restricted Stock Units) and (b) the contingent right to receive Earnout Shares; and |
• | each Navitas Warrant that is outstanding immediately prior to the Closing will be released and extinguished in exchange for (a) a warrant to purchase a number of shares of Class A Common Stock equal to the product of (x) the number of Navitas Delaware Common Shares or Navitas Delaware Preferred Shares or Navitas Ireland Common Shares or Navitas Ireland Preferred Shares subject to such Navitas Delaware Warrant or Navitas Ireland Warrant and (y) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Warrants, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Warrants, at an exercise price per share equal to (1) the exercise price per share of such Navitas Delaware Warrant or Navitas Ireland Warrant divided by (2) the Navitas Delaware Exchange Ratio, with respect to the Navitas Delaware Warrants, or the Navitas Ireland Exchange Ratio, with respect to the Navitas Ireland Warrants, and (b) the contingent right to receive Earnout Shares. |
• | the compulsory acquisition procedure provided under Section 457 of the Companies Act 2014 of Ireland (the “Companies Act”) will apply to all Navitas Ireland Shares not validly tendered in the Tender Offer by the date on which Navitas Ireland Shares representing at least 80% of each class of then issued and allotted Navitas Ireland Shares shall have been validly tendered into the Tender Offer (the “Binding Date”), so enabling LOKB to compulsorily acquire any such Navitas Ireland Shares subject to Chapter 2 Part 9 of the Companies Act; |
• | as soon as reasonably possible following the Binding Date, LOKB will serve notice on all dissenting shareholders of Navitas Ireland for the purposes of Section 457 of the Companies Act (the “Dissenting Shareholders”) notifying them of its intention to compulsorily acquire their Navitas Ireland Shares (the “Call Notice”); |
• | in accordance with and subject to the provisions of Chapter 2 of Part 9 of the Companies Act, the Dissenting Shareholders will be required to transfer, and LOKB will be bound to acquire, the Navitas Ireland Shares held by any dissenting shareholders of Navitas Ireland on the same terms as the Tender Offer; |
• | upon the expiry of thirty (30) days following the date the Call Notice was given and subject to: (a) no application for relief under Section 459(5) of the Companies Act (“Relief Application”) being made; (b) any Relief Application being withdrawn; and/or (c) following the Relief Application the Irish court nonetheless approving such acquisition, LOKB shall be bound to acquire all remaining Navitas Ireland Shares that it has not yet acquired and LOKB shall deliver to Navitas Ireland: (i) a copy of the Call Notice; (ii) a list of the Dissenting Shareholders served with the Call Notice and the number of Navitas Ireland Shares affected held by them; (iii) stock transfer forms executed: (A) on behalf of the Dissenting Shareholders as transferor by any person appointed by LOKB; and (B) by LOKB; and (iv) payment to Navitas Ireland or, if required as a matter of applicable law, its nominee, of all consideration representing |
• | Navitas will use reasonable best efforts to ensure that all holders of Navitas Ireland Shares will accept the Tender Offer and validly tender all of their Navitas Ireland Shares in accordance with the terms of the Tender Offer and, where requested by LOKB, will use reasonable best efforts to assist LOKB in relation to the exercise of the compulsory acquisition procedure as provided for under Section 459 and Chapter 2 Part 9 of the Companies Act. |
• | upon the occurrence of Earnout Triggering Event I, a one-time issuance of one-third of the aggregate Earnout Shares, allocated between additional Merger consideration and Tender Offer consideration in accordance with the Business Combination Agreement; |
• | upon the occurrence of Earnout Triggering Event II, a one-time issuance of one-third of the aggregate Earnout Shares, allocated between additional Merger consideration and Tender Offer consideration in accordance with the Business Combination Agreement; and |
• | upon the occurrence of Earnout Triggering Event III, a one-time issuance of one-third of the aggregate Earnout Shares, allocated between additional Merger consideration and Tender Offer consideration in accordance with the Business Combination Agreement. |
• | less than $12.50, then no Earnout Shares will be issuable; |
• | greater than or equal to $12.50 but less than $17.00, then, (a) immediately prior to such change of control, LOKB will issue one-third of the aggregate Earnout Shares to the Eligible Navitas Equityholders (in accordance with their respective pro rata shares and allocated between additional Merger consideration and Tender Offer consideration in accordance with the Business Combination Agreement) and (b) no further Earnout Shares will be issuable; |
• | greater than or equal to $17.00 but less than $20.00, then, (a) immediately prior to such change of control, LOKB will issue two-thirds of the aggregate Earnout Shares to the Eligible Navitas Equityholders (in accordance with their respective pro rata shares and allocated between additional Merger consideration and Tender Offer consideration in accordance with the Business Combination Agreement) and (b) no further Earnout Shares will be issuable; or |
• | greater than or equal to $20.00, then, (a) immediately prior to such change of control, LOKB will issue the Earnout Shares to the Eligible Navitas Equityholders (in accordance with their respective pro rata shares and allocated between additional Merger consideration and Tender Offer consideration in accordance with the Business Combination Agreement) and (b) no further Earnout Shares will be issuable. |
• | organization, qualification to do business, and subsidiaries; |
• | organizational documents; |
• | capitalization; |
• | authority to enter into the Business Combination Agreement; |
• | absence of conflicts with organizational documents, applicable laws or certain other agreements and required filings and consents; |
• | permits and compliance; |
• | financial statements; |
• | absence of certain changes or events since January 1, 2020; |
• | absence of litigation; |
• | employee benefit plans; |
• | labor and employment matters; |
• | real property and title to assets; |
• | intellectual property; |
• | taxes; |
• | environmental matters; |
• | material contracts; |
• | end customers, vendors and suppliers; |
• | insurance; |
• | approval of the board and shareholders; |
• | certain business practices, including, without limitation, with respect to anti-corruption laws, anti-money laundering laws and sanctions laws; |
• | interested party transactions; |
• | inapplicability of the Exchange Act and compliance with the Sarbanes-Oxley Act; |
• | brokers; and |
• | product warranty and products liability. |
• | corporate organization; |
• | organizational documents; |
• | capitalization; |
• | authority to enter into the Business Combination Agreement; |
• | absence of conflicts with organizational documents, applicable laws or certain other agreements and required filings and consents; |
• | compliance; |
• | proper filing of documents with the SEC, financial statements and compliance with the Sarbanes-Oxley Act; |
• | business activities; |
• | absence of certain changes or events since December 7, 2020; |
• | absence of litigation; |
• | approval of the board and the stockholders; |
• | no prior operations of Merger Sub; |
• | brokers; |
• | the Trust Account; |
• | employees; |
• | taxes; |
• | the registration and listing of Class A Common Stock, warrants and units; |
• | investigation and reliance; |
• | private placements; |
• | related party transactions; and |
• | inapplicability of the Investment Company Act of 1940, as amended (the “Investment Company Act”). |
• | amend or otherwise change the organizational documents of Navitas or any of its subsidiaries; |
• | adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of Navitas or any of its subsidiaries; |
• | cease or propose to cease to carry on its business or be wound up or enter into receivership, or any form of management or administration over the assets of the Navitas or any of its subsidiaries; |
• | apply or permit its directors to apply to petition to any court for an examinership or similar order to be made in respect of it in relation to the Navitas or any of its subsidiaries; |
• | create, allot, issue, redeem, buy-back, consolidate, convert or sub-divide, sell, pledge, subscribe, dispose of, grant or encumber, or authorize the issuance, redemption, buy-back, consolidation, conversion, sub-division, sale, pledge, disposition, grant or encumbrance of (a) any equity securities of Navitas or any of its subsidiaries; provided |
• | form any subsidiary or acquire any equity interest or other interest in any other entity or enter into a joint venture with any other entity; |
• | declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its equity interests, except (A) cash dividends and distributions by any wholly-owned subsidiary to Navitas or another wholly-owned subsidiary of Navitas in the ordinary course of business, consistent with past practice and (B) repurchases of awards under the 2020 Equity Incentive Plan in the ordinary course of business in connection with any termination of employment or other services for consideration no greater than the original issue price thereof; |
• | reclassify, combine, split, subdivide or redeem, or purchase or otherwise acquire, directly or indirectly, any of its equity interests; |
• | (a) acquire (including by merger, consolidation, or acquisition of stock or substantially all of the assets or any other business combination) any corporation, partnership, other business organization or any division thereof for consideration in excess of $1,000,000; or (b) incur any indebtedness for borrowed money in excess of $1,000,000 or issue any debt securities or assume, guarantee or endorse, or otherwise become responsible for, the obligations of any person in excess of $1,000,000, or intentionally grant any security interest in any of its assets (other than certain permitted liens); |
• | make any loans, advances or capital contributions to, or investments in, any other person (including to any of its officers, directors, agents or consultants), make any material change in its existing borrowing or lending arrangements for or on behalf of such persons, or enter into any “keep well” or similar agreement to maintain the financial condition of any other person, except advances to employees, directors or officers of Navitas or any of its subsidiaries in the ordinary course of business consistent with past practice; |
• | make any material capital expenditures (or commit to make any material capital expenditures) that in the aggregate exceed $1,000,000; |
• | acquire any fee or leasehold interest in real property; |
• | enter into, renew or amend in any material respect any Navitas interested party transaction (or any contractual or other arrangement, that if existing on the date of the Business Combination Agreement, would have constituted a Navitas interested party transaction); |
• | (a) grant any increase in the compensation, incentives or benefits payable or to become payable to any current or former director, officer, employee or consultant, except increases in salary, hourly wage rates, bonus opportunities or benefits (other than severance, retention, change in control or termination benefits) in the ordinary course of business consistent with past practice to any employee with an annual base salary below $250,000, (b) enter into any new, or amend any existing, employment, retention, bonus, change in control, severance or termination agreement with any current or former director, officer, employee or consultant, (c) accelerate or commit to accelerate the funding, payment, or vesting of any compensation or benefits to any current or former director, officer, employee or consultant, (d) establish or become obligated under any collective bargaining agreement, collective agreement or other contract or agreement with a labor union, trade union, works council or other similar representative of employees; (e) hire any new employee other than on an at-will basis with total compensation below $250,000 on an annualized basis and without severance or other payment or penalty obligations of Navitas or any of its subsidiaries in connection with a termination of employment or change of control transaction; or (f) transfer any employee or terminate the employment or service of any employee other than any such termination for cause (as determined by Navitas in its sole good faith discretion) or any transfer or termination of employment of any employee with an annual base salary of less than $250,000; except that, notwithstanding any of the foregoing, Navitas may (i) take action as required under any benefit plan or other employment or consulting agreement in effect on the date of the Business Combination Agreement or as required by Law, (ii) change the title of any employee in the ordinary course of business consistent with past practice and (iii) make annual or quarterly bonus or commission payments in the ordinary course of business consistent with past practice and in accordance with the bonus or commission plans existing on the date of the Business Combination Agreement and each such payment as set forth in Navitas’ Schedules; |
• | adopt, amend and/or terminate any material benefit plan except as may be required by applicable law, as is necessary in order to consummate the Business Combination, or for health and welfare plan renewals in the ordinary course of business consistent with past practice; |
• | make any change in any method of financial accounting or financial accounting principles, policies, procedures or practices, except as required by an amendment in GAAP or applicable law made subsequent to the date of the Business Combination Agreement, as agreed to by its independent accountants; |
• | (a) file or amend any income or other material tax return; (b) change any material method of tax accounting; (c) make, change or rescind any material election relating to taxes; (d) settle or compromise any material U.S. federal, state, local or non-U.S. tax audit, assessment, tax claim or other controversy relating to taxes; or (e) initiate or conduct any proceedings or discussions or file or deliver any request, documentation or other information, in each case, with any governmental authority in respect of a mutual agreement procedure or similar process; |
• | (a) amend, modify or consent to the termination (excluding any expiration in accordance with its terms) of any material contract or real property lease or certain new employment agreements, or amend, waive, modify or consent to the termination (excluding any expiration in accordance with its terms) of Navitas’ or any of its subsidiaries’ material rights thereunder in a manner that is adverse to Navitas or any of its subsidiaries, taken as a whole, except in the ordinary course of business consistent with past practice or (b) enter into any contract or agreement that would have been subject to the foregoing restrictions had it been entered into prior to the date of the Business Combination Agreement except in the ordinary course of business consistent with past practice; |
• | fail to maintain the existence of, or use reasonable best efforts to protect, intellectual property rights owned or purported to be owned by Navitas or any of its subsidiaries (“Navitas-Owned IP”); |
• | enter into any contract, agreement or arrangement that obligates Navitas or any of its subsidiaries to develop any intellectual property related to the business of Navitas or its products other than in the ordinary course of business consistent with past practice; |
• | permit any material item of Navitas-Owned IP to lapse or to be abandoned, invalidated, dedicated to the public, or disclaimed, or otherwise become unenforceable or fail to perform or make any applicable filings, recordings or other similar actions or filings, or fail to pay all required fees and taxes required or advisable to maintain and protect its interest in each and every material item of Navitas-Owned IP; |
• | conduct, waive, release, assign, settle or compromise any action or any right in relation to any action, other than waivers, releases, assignments, settlements or compromises that are solely monetary in nature and do not exceed $250,000 individually or $500,000 in the aggregate; |
• | enter into any material new line of business outside of the business currently conducted by Navitas or any of its subsidiaries as of the date of the Business Combination Agreement; |
• | voluntarily fail to maintain, cancel or materially change coverage under any insurance policy in form and amount equivalent in all material respects to the insurance coverage currently maintained with respect to Navitas and its subsidiaries and their assets and properties; |
• | fail to keep current and in full force and effect, or to comply in all material respects with the requirements of, any permit that is material to the conduct of the business of Navitas and its subsidiaries; |
• | take any action or step which could change its residence for tax purposes (including any action or step that causes Navitas to cease to be a Tax resident in a jurisdiction in which it is currently a resident) or cause it to be treated as having a branch, agency, permanent establishment or other taxable presence in any jurisdiction other than its jurisdiction of incorporation, organization or formation, as applicable; |
• | amend or discontinue any pension scheme or communicate to any member or former member, officer or employee of any of the pension scheme’s a plan, proposal or an intention to amend, discontinue, or exercise a discretion, in relation to such pension scheme; |
• | amend or revise any documentation or agreements relating to the restructuring involving Navitas and its subsidiaries and related transfers of assets that occurred in 2020; |
• | enter into any formal or informal agreement (except, in certain cases, non-binding letters of intent) or otherwise make a binding commitment to do any of the foregoing. |
• | amend or otherwise change their organizational documents or form any subsidiary of LOKB other than Merger Sub; |
• | declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of their equity interests, other than redemptions from the Trust Account that are required pursuant to LOKB’s organizational documents, including the Charter; |
• | reclassify, combine, split, subdivide or redeem, or purchase or otherwise acquire, directly or indirectly, any of LOKB’s equity interests (including warrants) except for redemptions from the Trust Account and conversions of the Class B Common Stock that are required pursuant to LOKB’s organizational documents; |
• | issue, sell, pledge, dispose of, grant or encumber, or authorize the issuance, sale, pledge, disposition, grant or encumbrance of, any shares of any equity interests of LOKB or Merger Sub or rights of any kind to acquire any equity interests, of LOKB or Merger Sub, except in connection with conversion of the Class B Common Stock pursuant to LOKB’s organizational documents and in connection with a loan from our Sponsor or an affiliate thereof or certain of LOKB’s officers and directors to finance LOKB’s transaction costs; |
• | acquire (including by merger, consolidation, or acquisition of stock or substantially all of the assets or any other business combination) any corporation, partnership, other business organization or enter into any strategic joint ventures, partnerships or alliances with any other person; |
• | incur any indebtedness for borrowed money or guarantee any such indebtedness of another person or persons, issue or sell any debt securities or options, warrants, calls or other rights to acquire any debt securities of LOKB, as applicable, enter into any “keep well” or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing, in each case, except in the ordinary course of business consistent with past practice or except a loan from our Sponsor or an affiliate thereof or certain of LOKB’s officers and directors to finance LOKB Transaction Costs in connection with the transactions contemplated by the Business Combination Agreement; |
• | make any change in any method of financial accounting or financial accounting principles, policies, procedures or practices, except as required by a concurrent amendment in U.S. GAAP or applicable law made subsequent to the date of the Business Combination Agreement, as agreed to by LOKB’s independent accountants; |
• | (a) amend any material tax return; (b) change any material method of tax accounting; (c) make, change or rescind any material election relating to taxes; or (d) settle or compromise any material U.S. federal, state, local or non-U.S. tax audit, assessment, tax claim or other controversy relating to taxes; |
• | liquidate, dissolve, reorganize or otherwise wind up the business and operations of LOKB or Merger Sub; |
• | amend or modify the Trust Account or any agreement related to the Trust Account; |
• | conduct, waive, release, assign, settle or compromise any action or any right in relation to any action, other than waivers, releases, assignments, settlements or compromises that are solely monetary in nature and do not exceed $100,000 individually or $250,000 in the aggregate (or to enforce its rights under the Business Combination Agreement or the ancillary agreements); |
• | adopt or enter into any employee benefit plan; or |
• | enter into any formal or informal agreement or otherwise make a binding commitment to do any of the foregoing. |
• | Navitas and LOKB providing access to books and records and furnishing relevant information to the other party, subject to certain limitations and confidentiality provisions; |
• | employee benefit matters; |
• | director and officer indemnification; |
• | prompt notification of certain matters; |
• | the parties using reasonable best efforts to consummate the Business Combination; |
• | the PIPE Financing; |
• | public announcements relating to the Business Combination; |
• | antitrust matters; |
• | the intended tax treatment of the Business Combination; |
• | cooperation regarding any filings required under the HSR Act; |
• | LOKB making disbursements from the Trust Account; |
• | LOKB taking all necessary action so that immediately after the Effective Time the LOKB Board will be comprised of the individuals set forth in the Director Election Proposal; |
• | Navitas using reasonable best efforts to deliver the Navitas Audited Financial Statements within 30 days of the date of the Business Combination Agreement; |
• | Navitas using reasonable best efforts to terminate certain affiliate transactions and agreements; |
• | Navitas delivering a valuation analysis allocating the value of the Navitas Shares between the Navitas Ireland Shares and Navitas Delaware Shares prior to the effectiveness of this Registration Statement; and |
• | Navitas using its reasonable best efforts to (a) amend each outstanding Navitas Warrant to cause each such Navitas Warrant to be (i) released and extinguished in exchange for a LOKB warrant or (ii) deemed exercised (with, to the extent applicable any Navitas Ireland Shares being deemed tendered into the Tender Offer) or (b) cause (i) the exercise of each Navitas Warrant (with, to the extent applicable any Navitas Ireland Shares being tendered into the Tender Offer) or (ii) the termination of each Navitas Warrant. |
• | the written consent of the requisite shareholders of Navitas Delaware in favor of the approval and adoption of the Business Combination Agreement and the Business Combination; |
• | the Business Combination Proposal, the Charter Proposals, the PIPE Proposal, the 2021 Plan Proposal and the Director Election Proposal having each been approved and adopted by the requisite affirmative vote of the LOKB stockholders in accordance with the Delaware General Corporation Law, LOKB’s organizational documents and the rules and regulations of the NYSE; |
• | the offers made pursuant to the Tender Offer for shares of Navitas Ireland having been accepted in respect of shares of Navitas Ireland representing at least 80% of each class of then issued and allotted shares of Navitas Ireland and any dissenting shareholders of Navitas Ireland being required to transfer their shares of Navitas Ireland to LOKB as a result of the Tender Offer (pursuant to the compulsory acquisition procedure provided under Section 457 of the Companies Act 2014 of Ireland) (such that upon the consummation of the Tender Offer, LOKB will have acquired 100% of each class of then issued and allotted shares of Navitas Ireland); |
• | no governmental authority having enacted, issued, promulgated, enforced or entered any law, rule, regulation, judgment, decree, executive order or award which is then in effect and has the effect of making the Business Combination illegal or otherwise prohibiting the consummation of the Business Combination; |
• | all required filings under the HSR Act and any other applicable antitrust laws having been completed and any applicable waiting period (and any extension thereof) applicable to the consummation of the Business Combination under the HSR Act and any other applicable antitrust laws having expired or been terminated; |
• | the Registration Statement having been declared effective and no stop order suspending the effectiveness of the Registration Statement being in effect, and no proceedings for purposes of suspending the effectiveness of the Registration Statement having been initiated or threatened by the SEC; and |
• | the shares of Class A Common Stock to be issued pursuant to the Business Combination Agreement (including the Earnout Shares) and in connection with the consummation of the Tender Offer having been approved for listing on a national securities exchange, as of the Closing, subject only to official notice of issuance thereof. |
• | the accuracy of the representations and warranties of the Company as determined in accordance with the Business Combination Agreement; |
• | Navitas having performed or complied in all material respects with all agreements and covenants required by the Business Combination Agreement to be performed or complied with by it at or prior to the Effective Time; |
• | no Navitas Material Adverse Effect (as defined below) having occurred following the date of the Business Combination Agreement that is continuing and uncured; |
• | receipt of resignations from the members of the governing bodies of the Company and its subsidiaries except for the persons identified as continuing directors; |
• | the Company having delivered a certification that the equity interests of the Company are not “United States real property interests”; |
• | LOKB having at least $5,000,001 of net tangible assets following the redemption of public shares by LOKB’s public stockholders in accordance with LOKB’s organizational documents; |
• | the sale and issuance by LOKB of Class A Common Stock in connection with the PIPE Financing having been consummated prior to or in connection with the Closing; |
• | new employment agreements with certain executives being in full force and effect; and |
• | each Navitas Warrant having been terminated, exercised (and any shares of Navitas Ireland received upon such exercise being tendered into the Tender Offer) or amended in the manner permitted by the Business Combination Agreement, provided that this condition will not apply to any Navitas Warrant that is unvested (and not reasonably expected by Navitas to become vested in accordance with its |
terms) and represents a de minimis amount of the outstanding equity of Navitas immediately prior to Closing. |
• | LOKB having at least $250,000,000 in available cash (including proceeds in connection with the PIPE Financing and the funds in the Trust Account and after taking into account payments required to satisfy redemptions of public shares by LOKB’s public stockholders); |
• | the accuracy of the representations and warranties of LOKB and Merger Sub as determined in accordance with the Business Combination Agreement; |
• | each of LOKB and Merger Sub having performed or complied in all material respects with all agreements and covenants required by the Business Combination Agreement to be performed or complied with by it on or prior to the Effective Time; |
• | no LOKB Material Adverse Effect having occurred following the date of the Business Combination Agreement that is continuing and uncured; and |
• | LOKB having made all necessary and appropriate arrangements with Continental Stock Transfer & Trust Company to have all of the funds held in the Trust Account disbursed to LOKB immediately prior to the Effective Time, and all such funds released from the Trust Account being available to LOKB in respect of all or a portion of the payment obligations set forth in the Business Combination Agreement and the payment of LOKB’s fees and expenses incurred in connection with the Business Combination Agreement and the Business Combination. |
• | by mutual written consent of LOKB and Navitas; |
• | by either LOKB or Navitas if the Effective Time will not have occurred prior to November 2, 2021 (the “Outside Date”); provided, however, that the Business Combination Agreement may not be terminated |
by or on behalf of any party that either directly or indirectly through its affiliates is in breach or violation of any representation, warranty, covenant, agreement or obligation contained therein and such breach or violation is the principal cause of the failure of a condition to the Merger on or prior to the Outside Date; provided, further, that (a) in the event that any law is enacted after the date of the execution of the Business Combination Agreement extending the applicable waiting period under the HSR Act or any other antitrust laws, the Outside Date will automatically be extended by the length of any such extension and (b) in the event that Navitas has failed to deliver to LOKB the audited consolidated balance sheet of Navitas and its subsidiaries as of December 31, 2019 and December 31, 2020, and the related audited consolidated statements of operations and cash flows of Navitas and its subsidiaries for the years then ended, audited in accordance with the standards of the PCAOB (the “Navitas Audited Financial Statements”) within 30 days of the execution of the Business Combination Agreement (the “Financial Statement Delivery Date”), the Outside Date will automatically be extended by one Business Day for each Business Day elapsing from the Financial Statement Delivery Date until the date the Navitas Audited Financial Statements will have been delivered by the Navitas to LOKB, up to a total of 30 additional Business Days; |
• | by either LOKB or Navitas if any governmental authority will have enacted, issued, promulgated, enforced or entered any injunction, order, decree or ruling which has become final and non-appealable and has the effect of making consummation of the transactions contemplated by the Business Combination Agreement or the related transaction documents, including the Tender Offer and the Merger, illegal or otherwise preventing or prohibiting consummation of the transactions contemplated by the Business Combination Agreement or the related transaction documents, the Tender Offer or the Merger; |
• | by either LOKB or Navitas if any of the LOKB Proposals fails to receive the requisite vote for approval at the special meeting (subject to any adjournment, postponement or recess of such meeting); |
• | by LOKB upon a breach of any representation, warranty, covenant or agreement on the part of Navitas set forth in the Business Combination Agreement, or if any representation or warranty of Navitas will have become untrue, in either case such that certain conditions set forth in the Business Combination Agreement would not be satisfied (“Terminating Navitas Breach”); provided, that LOKB has not waived such Terminating Navitas Breach and LOKB and Merger Sub are not then in material breach of their representations, warranties, covenants or agreements in the Business Combination Agreement; provided, further, that, if such Terminating Navitas Breach is curable by Navitas, LOKB may not terminate the Business Combination Agreement for so long as Navitas continues to exercise its reasonable best efforts to cure such breach, unless such breach is not cured within 30 days after notice of such breach is provided by LOKB to Navitas; |
• | by Navitas upon a breach of any representation, warranty, covenant or agreement on the part of LOKB or Merger Sub set forth in the Business Combination Agreement, or if any representation or warranty of LOKB or Merger Sub will have become untrue, in either case such that certain conditions set forth in the Business Combination Agreement would not be satisfied (“Terminating LOKB Breach”); provided, that Navitas has not waived such Terminating LOKB Breach and Navitas is not then in material breach of its representations, warranties, covenants or agreements in the Business Combination Agreement; provided, further, that, if such Terminating LOKB Breach is curable by LOKB and Merger Sub, Navitas may not terminate the Business Combination Agreement for so long as LOKB and Merger Sub continue to exercise their reasonable best efforts to cure such breach, unless such breach is not cured within 30 days after notice of such breach is provided by Navitas to LOKB; or |
• | by LOKB if Navitas will have failed to deliver the Navitas Audited Financial Statements to LOKB within 75 days of the execution of the Business Combination Agreement. |
• | an early stage industrial grade lidar technology producer specializing in perception and automotive solutions |
• | an early stage technology platform that provides solar panels and battery storage systems to the residential market |
• | a materials science company focused on replacing single use plastics |
• | a digital residential real estate acquisition platform |
• | nationwide provider of comprehensive home services |
• | pet supply company providing food, toys, treats and other animal necessities |
• | a developer and operator of aquaculture systems focused on sustainable protein production |
• | an owner and developer of specialty gas reserve rights |
• | an early stage manufacturer of safe and energy efficient battery technology solution |
• | an early stage producer of space infrastructure solutions |
• | Business Highlights. |
• | Competitive Positioning |
• | Due Diligence |
• | Financial Condition Certain Navitas Projected Financial Information |
• | Attractive Market Valuation of Comparable Companies |
• | GaN Semiconductor Peers : |
• | Integrated Semiconductor Peers : |
• | AutoTech / Semi SPAC Peers : |
• | Experienced and Proven Management Team |
• | Other Alternatives |
• | Negotiated Transaction |
• | Macroeconomic Risks |
• | Redemption Risk |
• | Stockholder Vote |
• | Closing Conditions |
• | Litigation |
• | Benefits May Not Be Achieved |
• | No Third-Party Valuation |
• | LOKB Stockholders Receiving a Minority Positions |
• | Interests of LOKB’s Directors and Officers Interests of LOKB’s Directors and Officers in the Business Combination |
• | Other Risk Factors Risk Factors |
Year Ending December 31, |
||||||||||||||||||||||||
2021P |
2022P |
2023P |
2024P |
2025P |
2026P |
|||||||||||||||||||
(dollars in millions) |
||||||||||||||||||||||||
Revenue |
$ | 27.3 | $ | 68.9 | $ | 182.4 | $ | 307.8 | $ | 453.6 | $ | 640.0 | ||||||||||||
Cost of goods sold |
$ | 14.8 | $ | 34.5 | $ | 89.3 | $ | 144.3 | $ | 205.6 | $ | 288.2 | ||||||||||||
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Gross profit |
$ | 12.5 | $ | 34.4 | $ | 93.1 | $ | 163.5 | $ | 248.0 | $ | 351.8 | ||||||||||||
Gross margin(1) |
45.8 | % | 50.0 | % | 51.0 | % | 53.1 | % | 54.7 | % | 55.0 | % | ||||||||||||
Operating expenses(2) |
$ | 35.3 | $ | 53.5 | $ | 81.1 | $ | 113.2 | $ | 146.5 | $ | 189.4 | ||||||||||||
Adjusted EBITDA(3) |
$ | (22.8 | ) | $ | (19.1 | ) | $ | 12.0 | $ | 50.3 | $ | 101.5 | $ | 162.4 | ||||||||||
Adjusted EBITDA margin(4) |
(83.6 | )% | (27.7 | )% | 6.6 | % | 16.3 | % | 22.4 | % | 25.4 | % | ||||||||||||
Capital expenditures |
$ | 1.1 | $ | 5.1 | $ | 6.9 | $ | 11.1 | $ | 12.6 | $ | 18.7 |
(1) | Navitas defines gross margin as gross profit divided by total revenue, expressed as a percentage of total revenue. |
(2) | Operating expenses include sales and marketing expenses, research and development expenses, general and administrative expenses and expenses related to operations. |
(3) | Navitas defines Adjusted EBITDA as net income excluding interest, taxes, non-cash stock based compensation, depreciation and amortization. Adjusted EBITDA is not a financial measure prepared in accordance with GAAP and should not be considered a substitute for net income prepared in accordance with GAAP. |
(4) | Navitas defines Adjusted EBITDA margin as Adjusted EBITDA divided by total revenue, expressed as a percentage of total revenue. Adjusted EBITDA margin is not a financial measure prepared in accordance with GAAP and should not be considered a substitute for operating margin prepared in accordance with GAAP. |
(1) | Based on design wins in production or committed to production. |
(2) | Based on Navitas’ assumptions concerning future demand from potential opportunities evaluated with new and existing end customers. |
• | the ability of gallium nitride (“GaN”) power integrated circuits (“ICs”) to penetrate the overall semiconductor market, including the ability of GaN ICs to displace legacy silicon-based ICs; |
• | Navitas’ ability to maintain its relationships with its existing end customers; |
• | Navitas’ ability to convert awarded and qualified opportunities into binding orders and sales; |
• | Navitas’ ability to develop new relationships with suppliers and new end customers; and |
• | the continued growth of Navitas’ end markets, including mobile, consumer, enterprise, renewables/solar and EV/eMobility. |
• | For 2021-2023, the revenue and volume projections were constructed based on customer and project forecasts while using a forecast outlined by industry research to validate the aggregate customer assumptions; such forecasts are heavily based on over $100m of Awarded Business (“Customer projects that are in production or committed to go to production using Navitas GaN ICs”). |
• | For 2024-2026, customer and project forecasts were considered along with Navitas and industry forecasts to construct reasonable revenue and market share estimates; such forecasts are heavily based on over $580m of Qualified Opportunities (“Customer projects that have been pre-qualified to have a high interest in Navitas GaN ICs, but have not yet committed to our GaN ICs”). |
• | Customer project forecasts typically assumed a 20-40% reduction to account for possible project delays or optimistic market forecasts, as well as risks of project cancellations. |
• | For the new “Expansion Markets” (Enterprise, Renewables / Solar, EV / eMobility), specific lead customers were consulted to confirm strong interest and value to adopt Navitas GaN ICs for targeted high-volume production programs. |
• | In cases where customers require two GaN suppliers to support their production needs, Navitas assumed a conservative 50% market share, even though customer indications suggest a majority share for Navitas given GaN IC technology and system cost/performance advantages. |
• | R&D headcount and related investments can be leveraged across the new end markets given the GaN IC solutions will be similar for these similar power levels (i.e., 1kW to 20kW, across Enterprise, Renewables / Solar and EV / eMobility). |
• | Existing sales and field technical support resources are already in place for the needed expertise and bandwidth to support our expansion markets, but significant additional sales, marketing and field technical support resources will be needed to scale our revenues in each of these new markets to achieve the targeted long term revenue plans through 2026. |
• | Typical customer development times were assumed as below on customer inputs and management’s experiences in serving each of these markets during their careers and while at Navitas: |
• | Mobile / Consumer: 6 to 12 months |
• | Enterprise: 12 to 18 months |
• | Renewables / Solar: 24 to 36 months |
• | EV: 36 to 48 months |
• | Navitas assumed a 20% cost/performance generational advancement every year with the majority of the cost saving passed to customers to contribute to its expectations that GaN ICs will achieve system cost parity |
compared to Silicon-based systems in 2023 and a cost reduction thereafter, while incrementally enhancing the company gross margin towards the long-term operating model of 55%. |
• | Navitas assumed very limited manufacturing capital equipment investments as it maintains its fabless identity keeping all or the majority of our manufacturing with supply chain partners. |
• | Navitas assumed the majority of operating expenses will be related to Research and Development over the projection period. |
• | Continuing Officers and Directors |
Name |
Title | |
Gene Sheridan | Chief Executive Officer | |
Daniel Kinzer | Chief Technology Officer and Chief Operating Officer |
• | In addition, the following individuals who are currently directors of Navitas are expected to become members of the post-combination company board upon the completion of the Business Combination: Gene Sheridan, Daniel Kinzer, Brian Long, Dipender Saluja and David Moxam. |
• | the fact that our Sponsor holds 4,666,667 private placement warrants that would expire worthless if a Business Combination is not consummated; |
• | the fact that our Sponsor, officers and directors have agreed not to redeem any of the shares of our common stock held by them in connection with a stockholder vote to approve the Business Combination; |
• | the fact that our Sponsor paid an aggregate of $25,000 for the Founders Stock, and that such securities will have a significantly higher value at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2021; |
• | if the Trust Account is liquidated, including in the event we are unable to complete an Initial Business Combination within the required time period, our Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per public share, or such lesser amount per public share as is in the Trust Account on the liquidation date, by the claims of (a) any third party (other than our independent registered public accounting firm) for services rendered or products sold to us or (b) a prospective target business with which we have entered into a letter of intent, confidentiality or other similar agreement or business combination agreement, but only if such a third party or target business has not executed a waiver of all rights to seek access to the Trust Account and except as to any claims under LOKB’s indemnity of its underwriters against certain liabilities; |
• | the fact that our each of our officers and directors hold a direct or indirect interest in our Sponsor, which interest will be worthless unless a business combination is consummated; |
• | the fact that Richard J. Hendrix and Gary Wunderlich will continue as members of the post-combination board |
• | the fact that previous investors with Live Oak Merchant Partners have been committed to invest $14.5 million in the PIPE Financing; |
• | the fact that our Sponsor, officers and directors will not be reimbursed for any loans extended, fees due or out-of-pocket expenses incurred in connection with activities on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations unless a business combination is consummated, although no such amounts require reimbursement as of the date of this proxy statement/prospectus; |
• | the fact that our Sponsor and its affiliates can earn a positive rate of return on their investment, even if other LOKB shareholders experience a negative rate of return in the post-business combination company; and |
• | the fact that our Sponsor, officers and directors will lose their entire investment in us if an Initial Business Combination is not completed. At the closing of the Business Combination, we anticipate that our Sponsor will hold 4,666,667 private placement warrants and 6,325,000 shares of Founders Stock. In addition, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds to finance transaction costs in connection with an Initial Business Combination. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.50 per warrant at the option of |
the lender. The warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. While no such loans are outstanding as of the date of this proxy statement/prospectus, we anticipate that our Sponsor may provide a loan to us prior to the Closing. While no assurances can be made as to the ultimate amount of this loan, we believe that the principal amount of the loan could be approximately $50,000 to $150,000. Our ability to repay this loan (either in cash or, at our Sponsor’s election, through the conversion of the loan into private placement warrants as described above) is dependent upon the completion of an Initial Business Combination. |
Security |
Total Capital Contribution |
Value as of , 2021 |
||||||
Private placement warrants(1) |
$ | 7,000,000 | $ |
|||||
Founders Stock(2) |
$ | 25,000 | $ |
(1) | Includes 1,500,000 private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination—Backstop Agreement” for more information. |
(2) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. See “The Business Combination—Sponsor Letter Amendment” for more information. |
Name |
Position |
Total Capital Contribution |
Value as of , 2021 (1) |
|||||||
John P. Amboian |
Chairman | $ | 750,000 | $ |
||||||
Richard J. Hendrix |
Chief Executive Officer and Director | $ | 475,000 | $ |
||||||
Andrea Tarbox |
Chief Financial Officer and Director | $ | 300,000 | $ |
||||||
Gary K. Wunderlich, Jr. |
President | $ | 475,000 | $ |
||||||
Adam Fishman |
Chief Operating Officer | $ | 400,000 | $ |
||||||
Jon Furer |
Director | $ | 450,000 | $ |
||||||
Tor Braham |
Director | $ | 450,000 | $ |
(1) | Includes the value of 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. Also includes the value of 1,500,000 private placement warrants that may be transferred to Encompass pursuant to the Backstop Agreement. See “The Business Combination—Sponsor Letter Amendment” and “The Business Combination—Backstop Agreement” for more information. |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
25,300,000 | 17.8 | 17,400,000 | 13.0 | 9,500,000 | 7.5 | ||||||||||||||||||
Sponsor(1) |
6,325,000 | 4.5 | 6,325,000 | 4.7 | 6,325,000 | 5.0 | ||||||||||||||||||
Eligible Navitas Equityholders(2)(3) |
95,000,000 | 66.8 | 95,000,000 | 70.8 | 95,000,000 | 75.2 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 10.9 | 15,500,000 | 11.5 | 15,500,000 | 12.3 | ||||||||||||||||||
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|
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|
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Total |
142,125,000 | 100.00 | 134,225,000 | 100.00 | 126,325,000 | 100.00 | ||||||||||||||||||
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|
(1) | LOKB Class A Common Stock owned upon conversion of shares of Founders Stock and, in the case of our Sponsor, includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. |
(2) | Includes (x) the up to approximately 78,300,000 shares of our Class A Common Stock anticipated to be issued to Navitas Shareholders and (y) the up to approximately 16,700,000 shares of our Class A Common Stock anticipated to be reserved for issuance in respect of (i) LOKB options issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Options, (ii) LOKB restricted stock issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Shares, (iii) LOKB restricted stock units issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Restricted Stock Units and (iv) LOKB warrants issued in exchange for the release and extinguishment of outstanding pre-business combination Navitas Warrants, in each case that may be exercised at a later date. |
(3) | Excludes (i) the reduction in the aggregate number of shares of Class A Common Stock issuable under the Business Combination Agreement based on the estimated stamp duty, as such amount will not be known with certainty until immediately prior to Closing, and (ii) the potential issuance of the Earnout Shares to the Eligible Navitas Equityholders. During the Earnout Period, we may issue to Eligible Navitas Equityholders up to 10,000,000 additional shares of Class A Common Stock in the aggregate in three equal tranches upon the satisfaction of price targets of $12.50, $17.00 or $20.00, which price targets are based upon the volume-weighted average closing sale price of one share of Class A Common Stock quoted on the exchange on which the shares of Class A Common Stock are then traded, for any 20 trading days within any 30 consecutive trading day period during the Earnout Period, or upon certain change of control transactions that imply a per share value that would satisfy the price targets. |
Holders |
No Redemption |
% of Total |
Illustrative Redemption |
% of Total |
Maximum Redemption |
% of Total |
||||||||||||||||||
LOKB Public Shareholders |
33,733,334 | 21.7 | 25,833,334 | 17.5 | 17,933,334 | 12.9 | ||||||||||||||||||
Sponsor/Independent Directors |
10,991,667 | 7.1 | 10,991,667 | 7.5 | 10,991,667 | 7.9 | ||||||||||||||||||
Eligible Navitas Equityholders |
95,000,000 | 61.2 | 95,000,000 | 64.5 | 95,000,000 | 68.1 | ||||||||||||||||||
PIPE Investors |
15,500,000 | 10.0 | 15,500,000 | 10.5 | 15,500,000 | 11.1 | ||||||||||||||||||
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|
|
|
|
|
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Total |
155,225,001 | 100.00 | 147,325,001 | 100.00 | 139,425,001 | 100.00 | ||||||||||||||||||
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Sources of Cash(1) |
Uses of Cash(1) |
|||||||||
(in millions) |
||||||||||
LOKB cash in Trust Account(2) |
$ | 253 | Navitas shareholder equity rollover(3) |
$ | 950 | |||||
Navitas shareholder equity rollover(3) |
950 | Cash to balance sheet |
367 | |||||||
PIPE Financing |
155 | Deal expenses |
41 | |||||||
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|
|
|
|||||||
Total Sources |
1,358 | Total Uses |
1,358 | |||||||
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|
|
(1) | This sources and uses assumes no public stockholders elect to have their public shares redeemed. |
(2) | Actual amount to be adjusted for interest income prior to the Closing. As of June 30, 2021, $253,078,907 was held in the Trust Account. |
(3) | Excludes the estimated stamp duty to be deducted from the amount of shares of Class A Common Stock and other securities issuable to the Eligible Navitas Equityholders, as such amount will not be known with certainty until immediately prior to Closing. Also does not reflect the potential issuance of the Earnout Shares to the Eligible Navitas Equityholders. |
Underwriting Fees |
Assuming no redemption |
Assuming illustrative redemptions |
Assuming maximum redemption |
|||||||||
($ in millions, other than share numbers) |
||||||||||||
Unredeemed Public Shares (1) |
25,300,000 | 17,900,000 | 9,500,000 | |||||||||
Trust Proceeds to Navitas |
$ | 253.0 | $ | 179.0 | $ | 95 | ||||||
Deferred Underwriting Fees |
$ | 8.1 | $ | 8.1 | $ | 8.1 | ||||||
Effective Deferred Underwriting Fee (%) |
3.2 | % | 4.5 | % | 8.5 | % |
Name |
Age |
Position | ||||
Gene Sheridan |
55 | Chief Executive Officer and Director | ||||
Daniel Kinzer |
63 | Chief Operating Officer, Chief Technology Officer and Director | ||||
Brian Long |
64 | Director | ||||
Dipender Saluja |
56 | Director | ||||
David Moxam |
64 | Director | ||||
Richard J. Hendrix |
55 | Director | ||||
Gary K. Wunderlich, Jr. |
51 | Director |
• | banks, insurance companies or other financial institutions; |
• | tax-exempt or governmental organizations; |
• | qualified foreign pension funds as defined in Section 897(l)(2) of the Code (or any entities all of the interests of which are held by a qualified foreign pension fund); |
• | dealers in securities or foreign currencies; |
• | persons whose functional currency is not the U.S. dollar; |
• | traders in securities that use the mark-to-market |
• | “controlled foreign corporations,” “passive foreign investment companies” and corporations that accumulate earnings to avoid U.S. federal income tax; |
• | entities or arrangements treated as partnerships or pass-through entities for U.S. federal income tax purposes or holders of interests therein; |
• | persons deemed to sell Navitas Shares or Class A Common Stock under the constructive sale provisions of the Code; |
• | persons that acquired Navitas Shares or Class A Common Stock through the exercise of employee stock options or otherwise as compensation or through a tax-qualified retirement plan; |
• | persons that actually or constructively hold 5% or more (by vote or value) of any class of Navitas Shares or our shares; |
• | persons that hold Navitas Shares or Class A Common Stock as part of a straddle, appreciated financial position, synthetic security, hedge, conversion transaction, or other integrated investment or risk reduction transaction; |
• | certain former citizens or long-term residents of the United States; |
• | holders of shares of Founders Stock and private placement warrants; and |
• | our Sponsor and our officers or directors. |
• | an individual who is a citizen or resident of the United States; |
• | a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia; |
• | an estate the income of which is subject to U.S. federal income tax regardless of its source; or |
• | a trust (a) the administration of which is subject to the primary supervision of a U.S. court and which has one or more United States persons (within the meaning of the Code) who have the authority to control all substantial decisions of the trust or (b) which has made a valid election under applicable U.S. Treasury regulations to be treated as a United States person. |
• | the gain is effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment in the United States to which such gain is attributable); |
• | the Non-U.S. Holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the Exchange and certain other requirements are met; or |
• | Navitas is or has been a “United States real property holding corporation” for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of the Exchange or the period that the Non-U.S. Holder held Navitas Shares. |
• | the Non-U.S. Holder is an individual who is present in the United States for a period or periods aggregating 183 days or more during the calendar year in which the redemption occurs and certain other conditions are met; |
• | the gain is effectively connected with a trade or business conducted by the Non-U.S. Holder in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment maintained by the Non-U.S. Holder in the United States); or |
• | our Class A Common Stock constitutes a United States real property interest by reason of our status as a “United States real property holding corporation” (a “ USRPHC Non-U.S. Holder in the United States. |
Existing Charter |
Proposed Second A&R Charter | |||
Number of Authorized Shares (Proposal No. 2) |
• The existing Charter provides that the total number of authorized shares of all classes of capital stock is 111,000,000 shares, consisting of (a) 110,000,000 shares of common stock, par value $0.0001 per share, including (i) 100,000,000 shares of Class A Common Stock and (ii) 10,000,000 shares of Class B Common Stock and (b) 1,000,000 shares of Preferred Stock. • See Article IV of the existing Charter. |
• The Proposed Second A&R Charter provides that the total number of authorized shares of all classes of capital stock is, consisting of (a) shares of Class A Common Stock, $0.0001 par value per share, (b) shares of Class B Common Stock, $0.0001 par value per share which shall convert to Class A Common Stock upon the Closing of the Business Combination, and (c) shares of preferred stock, par value $0.0001 per share. • See Article IV of the Proposed Second A&R Charter. | ||
Additional Charter Proposal (Proposal No. 3) |
• The existing Charter sets forth that the name of the corporation is “Live Oak Acquisition Corp. II”. |
• The post-combination company will change its corporate name to “Navitas Semiconductor Corporation”. | ||
• The existing Charter provides that the purpose of the corporation is to engage in any lawful act or activity for which corporations may be organized under the DGCL. In addition to the powers and privileges conferred upon the corporation by law and those incidental thereto, the corporation shall possess and may exercise all the powers and privileges that |
• The Proposed Second A&R Charter provides that the purpose of the corporation is to engage in any lawful act or activity for which corporations may be organized under the DGCL. |
Existing Charter |
Proposed Second A&R Charter | |||
are necessary or convenient to the conduct, promotion or attainment of the business or purposes of the corporation, including, but not limited to, effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination, involving the corporation and one or more businesses. |
||||
• The existing Charter contains certain provisions relating to (i) redemption rights with respect to Class A Common Stock, (ii) the Trust Account, (iii) share issuances prior to the consummation of the Initial Business Combination, (iv) transactions with affiliates and other blank check companies, (v) approval of the Initial Business Combination and (vi) the minimum value of the target in the Initial Business Combination. |
• There will be no applicable language in the Proposed Second A&R Charter. |
• | The Authorized Share Charter Proposal (Proposal No. 2) is intended to provide adequate authorized share capital to (a) accommodate the issuance of shares of Class A Common Stock as part of the exchange for outstanding securities of Navitas at Closing (or reservation for issuance in respect of LOKB options, restricted shares, restricted stock units or warrants, in each case issued in exchange for the release and extinguishment of outstanding pre-merger Navitas Options, Navitas Restricted Shares, Navitas Restricted Stock Units or Navitas Warrants, as applicable) pursuant to the Business Combination Agreement, PIPE Financing, 2021 Plan and the future conversion of outstanding warrants into shares of Class A Common Stock and (b) provide flexibility for future issuances of Class A Common Stock and Preferred Stock if determined by the LOKB Board to be in the best interests of the post-combination company without incurring the risk, delay and potential expense incident to obtaining stockholder approval for a particular issuance. |
• | The Additional Charter Proposal (Proposal No. 3) is appropriate to adequately update the Charter for LOKB, because it will change the post-combination company’s corporate name from “Live Oak Acquisition Corp. II” to “Navitas Semiconductor Corporation” and eliminate obsolete language that will no longer be applicable following the consummation of the Business Combination and make such other changes that are more appropriate for a public operating company. |
• | Clawback Policy |
• | No Discounted Stock Options or Stock Appreciation Rights |
• | Certain Material Amendments to the 2021 Plan Require Stockholder Approval |
• | Limit on Non-Employee Director Awards and Other Awardsnon-employee director of the post-combination company during each calendar year, including both shares subject to stock awards granted under the 2021 Plan or otherwise and any cash fees paid to such non-employee director during any calendar year, may not exceed $750,000 in total value, or $1 million in total value for the calendar year in which a non-employee director is first elected to the post-combination company’s board (calculating the value of any such stock awards based on the grant date fair market value of such stock awards for financial reporting purposes). Such limitation on non-employee director stock awards does not apply to any cash retainer fees, including cash retainer fees converted into equity awards at the election of the non-employee director, expense reimbursements, or distributions from any deferred compensation program applicable to the non-employee director. |
• | All stock options and SARs held by the participant which were exercisable immediately prior to the participant’s termination of service with the post-combination company other than for Cause (as defined in the 2021 Plan) will, except as otherwise set forth in the option award agreement, remain exercisable for the lesser of (i) three months or (ii) the period ending on the latest date such stock option or SAR could have been exercised; |
• | All stock options and SARs held by the participant which were exercisable immediately prior to the participant’s termination of service with the post-combination company due to death will remain exercisable for the lesser of (i) the one-year period ending with the first anniversary of the participant’s termination or (ii) the period ending on the latest date on which such stock option or SAR could have been exercised (provided that a participant’s service will be deemed to have terminated due to death if the participant dies within three (3) months (or such other period provided by the participant’s award agreement) after the participant’s termination of service); and |
• | All stock options and SARs held by a participant which were exercisable immediately prior to the participant’s termination of service with the post-combination company due to Disability (as defined in the 2021 Plan) will remain exercisable for the lesser of (i) the one-year period ending with the first anniversary of the participant’s termination or (ii) the period ending on the latest date on which such stock option or SAR could have been exercised. |
• | our overall product mix and sales volumes; |
• | gains and losses in market share and design win traction; |
• | pace at which technology is adopted in our end markets; |
• | the stage of our products in their respective life cycles; |
• | the effects of competition and competitive pricing strategies; |
• | availability of specialized field application engineering resources supporting demand creation and end customer adoption of new products; |
• | achieving acceptable yields and obtaining adequate production capacity from our wafer foundries and assembly and test subcontractors; |
• | market acceptance of our end customers’ products; governmental regulations influencing our markets; and |
• | the global and regional economic cycles. |
Three Months Ended June 30, |
Change $ |
Change % |
Six Months Ended June 30, |
Change $ |
Change % |
|||||||||||||||||||||||||||
(dollars in thousands) |
2021 |
2020 |
2021 |
2020 |
||||||||||||||||||||||||||||
Revenue |
$ | 5,450 | $ | 2,516 | $ | 2,934 | 117 | % | $ | 10,767 | $ | 3,696 | $ | 7,071 | 191 | % | ||||||||||||||||
Cost of goods sold |
2,971 | 1,871 | 1,100 | 59 | % | 5,930 | 2,843 | 3,087 | 109 | % | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Gross profit |
2,479 | 645 | 1,834 | 284 | % | 4,837 | 853 | 3,984 | 467 | % | ||||||||||||||||||||||
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|
|
|
|
|
|
|||||||||||||||||||||||||
Operating expenses: |
||||||||||||||||||||||||||||||||
Research and development |
6,267 | 2,636 | 3,631 | 138 | % | 10,521 | 5,080 | 5,441 | 107 | % | ||||||||||||||||||||||
Selling, general and administrative |
14,794 | 1,887 | 12,907 | 684 | % | 20,163 | 3,383 | 16,780 | 496 | % | ||||||||||||||||||||||
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|
|
|
|
|
|
|
|||||||||||||||||||||||||
Total operating expenses |
21,061 | 4,523 | 16,538 | 30,684 | 8,463 | 22,221 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Loss from operations |
(18,582 | ) | (3,878 | ) | (25,847 | ) | (7,610 | ) | ||||||||||||||||||||||||
Interest expense, net |
(63 | ) | (56 | ) | (7 | ) | 13 | % | (124 | ) | (109 | ) | (15 | ) | 14 | % | ||||||||||||||||
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|
|
|
|
|
|
|
|||||||||||||||||||||||||
Loss before income taxes |
(18,645 | ) | (3,934 | ) | (25,971 | ) | (7,719 | ) | ||||||||||||||||||||||||
Income tax expense |
5 | — | 5 | — | % | 24 | 6 | 18 | 300 | % | ||||||||||||||||||||||
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|
|
|
|
|
|
|
|||||||||||||||||||||||||
Net loss |
$ | (18,650 | ) | $ | (3,934 | ) | $ | (14,716 | ) | 374 | % | $ | (25,995 | ) | $ | (7,725 | ) | $ | (18,270 | ) | 237 | % | ||||||||||
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|
Year Ended December 31, |
Change $ |
Change % |
||||||||||||||
(dollars in thousands) |
2020 |
2019 |
||||||||||||||
Revenue |
$ | 11,849 | $ | 1,687 | $ | 10,162 | 602 | % | ||||||||
Cost of goods sold |
8,134 | 1,167 | 6,967 | 597 | % | |||||||||||
|
|
|
|
|||||||||||||
Gross profit |
3,715 | 520 | 3,195 | 614 | % | |||||||||||
|
|
|
|
|||||||||||||
Operating expenses: |
||||||||||||||||
Research and development |
13,049 | 11,136 | 1,914 | 17 | % | |||||||||||
Selling, general and administrative |
9,469 | 6,478 | 2,991 | 46 | % | |||||||||||
|
|
|
|
|||||||||||||
Total operating expenses |
22,518 | 17,614 | ||||||||||||||
|
|
|
|
|||||||||||||
Loss from operations |
(18,803 | ) | (17,094 | ) | ||||||||||||
Interest expense, net |
(236 | ) | (254 | ) | 18 | (7 | )% | |||||||||
|
|
|
|
|||||||||||||
Net loss before income taxes |
(19,039 | ) | (17,348 | ) | ||||||||||||
Income tax expense |
5 | 1 | 4 | 400 | % | |||||||||||
|
|
|
|
|||||||||||||
Net loss |
$ | (19,044 | ) | $ | (17,349 | ) | $ | (1,695 | ) | 10 | % | |||||
|
|
|
|
Six Months Ended June 30, |
Year Ended December 31, |
|||||||||||||||
2021 |
2020 |
2020 |
2019 |
|||||||||||||
(in thousands) |
||||||||||||||||
Consolidated Statements of Cash Flows Data: |
||||||||||||||||
Net cash used in operating activities |
$ | (13,773 | ) | $ | (8,943 | ) | $ | (20,625 | ) | $ | (17,606 | ) | ||||
Net cash used in investing activities |
(1,469 | ) | (144 | ) | (215 | ) | (68 | ) | ||||||||
Net cash provided by financing activities |
222 | 35,966 | 53,590 | 3,610 |
(in thousands) | Remainder of 2021 |
2022 | 2023 | 2024 | 2025 | Thereafter | Total | |||||||||||||||||||||
Operating lease obligations |
$ | 548 | $ | 911 | $ | 531 | $ | 154 | $ | — | $ | — | $ | 2,144 | ||||||||||||||
Debt obligations payable |
1,000 | 2,400 | 2,400 | 200 | — | — | 6,000 | |||||||||||||||||||||
Interest on debt obligations 1 |
173 | 150 | 53 | — | — | 376 | ||||||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total |
$ | 1,721 | $ | 3,461 | $ | 2,984 | $ | 354 | $ | — | $ | — | $ | 8,520 | ||||||||||||||
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1 |
Interest is projected based on current rates and scheduled principal payments. |
• | Industry-Leading IP Position and Proprietary Design Support. |
• | Differentiated GaN Power Solutions with Significant Barriers to Entry. |
• | Established Relationships with Key Partners and End Customers. |
• | Proven Leadership Team of Tenured Industry Experts. . |
• | Acceleration of Technology Development and Innovation. |
• | Expansion into New End Markets and Geographies. |
• | Selective Acquisitions of Complementary Technologies. |
1. | GaN wafer and assembly (packaging) prices may not be reduced by suppliers as fast as expected or committed, especially if the global semiconductor shortage continues to last until 2022 or 2023. |
2. | GaN manufacturing yields, while demonstrated over 90% on a stable, multi-month basis, could deteriorate causing manufacturing costs of GaN IC to increase. |
3. | Silicon controllers, which are an important compliment to GaN power ICs used in all mobile chargers, are expected to decrease pricing in the future but price increases could occur, especially if the global semiconductor shortage continues to last until 2022 or 2023 and such prices are not directly controlled by Navitas. |
4. | Passive and mechanical components (inductors, transformers, capacitors, PCB, plastic housing, etc.) are an important compliment to GaN power ICs used in all mobile chargers and are important cost reduction elements as they generally decrease in size, weight and cost when GaN increases the charger switching frequency, compared to silicon-based chargers. Despite expected or committed cost reductions for these passive and mechanical components, it is possible that such cost reductions will not materialize as such prices are not directly controlled by Navitas. |
Name |
Age |
Position | ||
John P. Amboian |
59 | Chairman | ||
Richard J. Hendrix* |
55 | Chief Executive Officer and Director | ||
Andrea Tarbox* |
70 | Chief Financial Officer and Director | ||
Gary K. Wunderlich, Jr. |
51 | President | ||
Adam J. Fishman* |
41 | Chief Operating Officer | ||
Jon Furer |
64 | Director | ||
Tor Braham |
63 | Director |
* | Denotes an executive officer. |
• | the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm engaged by us; |
• | pre-approving all audit and permitted non-audit services to be provided by the independent registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; |
• | setting clear hiring policies for employees or former employees of the independent registered public accounting firm, including but not limited to, as required by applicable laws and regulations; |
• | setting clear policies for audit partner rotation in compliance with applicable laws and regulations; |
• | obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (i) the independent registered public accounting firm’s internal quality-control procedures, (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues and (iii) all relationships between the independent registered public accounting firm and us to assess the independent registered public accounting firm’s independence; |
• | reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and reviewing with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any |
legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities. |
• | reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, if any is paid by us, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation; |
• | reviewing and approving on an annual basis the compensation, if any is paid by us, of all of our other officers; |
• | reviewing on an annual basis our executive compensation policies and plans; |
• | implementing and administering our incentive compensation equity-based remuneration plans; |
• | assisting management in complying with our proxy statement and annual report disclosure requirements; |
• | approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees; |
• | if required, producing a report on executive compensation to be included in our annual proxy statement; and |
• | reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors. |
• | identifying, screening and reviewing individuals qualified to serve as directors and recommending to the board of directors candidates for nomination for election at the annual meeting of stockholders or to fill vacancies on the board of directors; |
• | developing and recommending to the board of directors and overseeing implementation of our corporate governance guidelines; |
• | coordinating and overseeing the annual self-evaluation of the board of directors, its committees, individual directors and management in the governance of the company; and |
• | reviewing on a regular basis our overall corporate governance and recommending improvements as and when necessary. |
• | None of our officers or directors is required to commit his or her full time to our affairs and, accordingly, may have conflicts of interest in allocating his or her time among various business activities. |
• | In the course of their other business activities, our officers and directors may become aware of investment and business opportunities which may be appropriate for presentation to us, as well as the other entities with which they are affiliated. Our management may have conflicts of interest in determining to which entity a particular business opportunity should be presented. |
• | Our Sponsor, officers and directors have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the consummation of our initial business |
combination. Additionally, our Sponsor, officers and directors have agreed to waive their redemption rights with respect to any founder shares held by them if we fail to consummate our initial business combination within 24 months after the closing of this offering. If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and the private placement warrants will expire worthless. With certain limited exceptions, the founder shares will not be transferable, assignable by our sponsor until the earlier of: (A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the reported closing price of our Class A Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30 — trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property, provided that effective as of and conditioned upon the Closing, the Sponsor Letter Amendment will amend certain provisions of the Sponsor Letter Agreement related to transfer restrictions on Class A Common Stock held by our Sponsor such that after giving effect to such amendment, (a) 20% of the shares of Founders Stock (which will be converted into shares of Class A Common Stock at the Closing) will be subject to forfeiture and, even if released from such forfeiture restrictions may not be transferred until the earlier to occur of (i) one year after the Closing, (ii) if the reported closing price of our Class A Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the consummation of our initial Business Combination or (iii) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property and (b) 80% of the shares of Founders Stock (which will be converted into shares of Class A Common Stock at the Closing) may not be transferred until released from extended transfer restrictions (with such release being made in three equal tranches after the Closing), subject to early release following the satisfaction of certain price targets of $12.00, $17.00 and $20.00, which price targets are based upon the volume-weighted average closing sale price of one share of Class A Common Stock quoted on the exchange on which the shares of Class A Common Stock are then traded, for any 20 trading days within any 30 consecutive trading day period commencing at least 150 days after the Closing Date. With certain limited exceptions, the private placement warrants and the Class A Common Stock underlying such warrants, will not be transferable, assignable or saleable by our sponsor or its permitted transferees until 30 days after the completion of our initial business combination. Since our sponsor and officers and directors may directly or indirectly own common stock and warrants following this offering, our officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. |
• | the fact that our Sponsor holds 4,666,667 private placement warrants that would expire worthless if a business combination is not consummated; |
• | the fact that our Sponsor, officers and directors have agreed not to redeem any of the shares of LOKB Common Stock held by them in connection with a stockholder vote to approve the Business Combination; |
• | the fact that our Sponsor paid an aggregate of $25,000 for the Founders Stock and that such securities will have a significantly higher value at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2021; |
• | if the Trust Account is liquidated, including in the event we are unable to complete an Initial Business Combination within the required time period, our Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per public share, or such lesser amount per public share as is in the Trust Account on the liquidation date, by the claims of (a) any third party |
(other than our independent registered public accounting firm) for services rendered or products sold to us or (b) a prospective target business with which we have entered into a letter of intent, confidentiality or other similar agreement or business combination agreement, but only if such a third party or target business has not executed a waiver of all rights to seek access to the Trust Account and except as to any claims under LOKB’s indemnity of its underwriters against certain liabilities; |
• | the fact that each of our officers and directors hold a direct or indirect interest in our Sponsor, which interest will be worthless unless a business combination is consummated; |
• | the fact that previous investors with Live Oak Merchant Partners have been committed to invest $14.5 million in the PIPE Financing; |
• | the fact that our Sponsor, officers and directors will not be reimbursed for any loans extended, fees due or out-of-pocket expenses incurred in connection with activities on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations unless a business combination is consummated; |
• | the fact that our Sponsor and its affiliates can earn a positive rate of return on their investment, even if other LOKB shareholders experience a negative rate of return in the post-business combination company; and |
• | the fact that our Sponsor, officers and directors will lose their entire investment in us if an Initial Business Combination is not completed. Our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. |
• | Our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. |
• | Our sponsor, officers or directors may have a conflict of interest with respect to evaluating a business combination and financing arrangements as we may obtain loans from our sponsor or an affiliate of our sponsor or any of our officers or directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.50 per warrant at the option of the lender. Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. |
• | the corporation could financially undertake the opportunity; |
• | the opportunity is within the corporation’s line of business; and |
• | it would not be fair to our company and its stockholders for the opportunity not to be brought to the attention of the corporation. |
Name |
Position | |
Gene Sheridan | Chief Executive Officer | |
Daniel Kinzer | Chief Technology Officer and Chief Operating Officer |
Compensation Purpose | ||
Base Salary |
Base salaries are intended to provide compensation consistent with each NEO’s responsibilities, experience and performance in relation to the marketplace. | |
Cash Bonus |
Cash bonuses are intended to incentivize and reward employees for contributions to the company’s performance. |
Compensation Purpose | ||
Equity Compensation |
Stock options are used to provide a strong incentive for creation of long-term shareholder value through promoting an employee ownership culture, as stock options may be exercised to provide value to executives to the extent Navitas’ stock price appreciates after the grant date. Stock options granted as part of the company’s long-term incentive plans generally vest in equal installments on each of the monthly anniversaries of the grant date over a period of four years, which may include a one-year cliff vesting date, to enhance retention and long-term thinking. In some cases, the Navitas Board has also utilized milestone-based vesting to incentivize specific outcomes and to correlate the vesting level to value creation. |
Name and principal position |
Fiscal Year |
Salary ($) |
Bonus ($)(1) |
Option Awards ($) |
All Other Compensation ($)(2) |
Total ($) |
||||||||||||||||||
Gene Sheridan |
2020 | $ | 375,000 | — | $ | — | $ | 11,400 | $ | 386,400 | ||||||||||||||
Chief Executive Officer |
2019 | $ | 375,000 | — | $ | — | $ | 11,200 | $ | 386,200 | ||||||||||||||
Daniel Kinzer |
2020 | $ | 350,000 | $ | 10,000 | $ | — | $ | 11,400 | $ | 371,400 | |||||||||||||
Chief Technology Officer/Chief Operating Officer |
2019 | $ | 350,000 | — | $ | — | $ | 11,200 | $ | 361,200 |
(1) | Reflects cash bonuses paid pursuant to Navitas’ informal annual cash bonus plan. |
(2) | Amounts reported under “All Other Compensation” reflect employer matching contributions made pursuant to Navitas’ 401(k) plan for each NEO. |
Fair Market Value |
Navitas Restricted Stock Units of Mr. Sheridan becoming eligible for vesting |
Navitas Restricted Stock Units of Mr. Kinzer becoming eligible for vesting | ||
$500,000,000 |
2,200,000 | 740,000 | ||
$550,000,000 |
2,275,000 | 810,000 | ||
$600,000,000 |
2,350,000 | 870,000 | ||
$650,000,000 |
2,425,000 | 940,000 | ||
$700,000,000 |
2,500,000 | 1,000,000 |
Name |
Amount of Note |
Number of Shares of Restricted Stock Granted |
||||||
Gene Sheridan |
$ | 796,987 | 2,748,232 | |||||
Daniel Kinzer |
$ | 278,059 | 958,823 |
Name |
Grant Date |
Number of Securities Underlying Unexercised Options (#) Exercisable |
Number of Securities Underlying Unexercised Options (#) Unexercisable |
Option Exercise Price ($) |
Option Expiration Date |
|||||||||||||||
Gene Sheridan |
3/28/2018 | 1,404,843 | (1) | 417,657 | (1) | $ | 0.20 | 3/27/2028 | ||||||||||||
Daniel Kinzer |
3/28/2018 | 702,421 | (2) | 208,829 | (2) | $ | 0.20 | 3/27/2028 |
(1) | The unvested portion of the award vests monthly, in eleven ratable installments, and will be fully vested on November 16, 2021. Under the original award, 25% of the shares underlying the award vest one year from the vesting commencement date, November 16, 2017. Thereafter, 1/48 of the shares underlying the award vest each month from the first anniversary of the vesting commencement date. The award vests in full upon a change in control, which includes the consummation of the Business Combination. |
(2) | The unvested portion of the award vests monthly, in eleven ratable installments, and will be fully vested on November 16, 2021. Under the original award, 25% of the shares underlying the award vest one year from the vesting commencement date, November 16, 2017. Thereafter, 1/48 of the shares underlying the award vest each month from the first anniversary of the vesting commencement date. The award vests in full upon a change in control, which includes the consummation of the Business Combination. |
Name |
Age |
Position(s) | ||||
Executive Officers |
||||||
Gene Sheridan |
55 | Chief Executive Officer and Director | ||||
Daniel Kinzer |
63 | Chief Operating Officer, Chief Technology Officer and Director | ||||
Brian Long |
64 | Director | ||||
Dipender Saluja |
56 | Director | ||||
David Moxam |
64 | Director | ||||
Richard J. Hendrix |
55 | Director | ||||
Gary K. Wunderlich, Jr. |
51 | Director |
(1) | Member of the audit committee, effective upon completion of the Business Combination. |
(2) | Member of the compensation committee, effective upon completion of the Business Combination. |
(3) | Member of the nominating and corporate governance committee, effective upon completion of the Business Combination. |
• | assisting the post-combination company’s board in the oversight of (i) accounting and financial reporting processes of the post-combination company and the audits of the financial statements of post-combination company, (ii) preparation and integrity of the financial statements of the post-combination company, (iii) compliance by the post-combination company with financial statement and regulatory requirements, (iv) performance of the post-combination company’s internal finance and accounting personnel and its independent registered public accounting firms, and (v) qualifications and independence of the post-combination company’s independent registered public accounting firms; |
• | reviewing with each of the internal and independent registered public accounting firms the overall scope and plans for audits, including authority and organizational reporting lines and adequacy of staffing and compensation; |
• | reviewing and discussing with management and internal auditors the post-combination company’s system of internal control and discuss with the independent registered public accounting firm any significant matters regarding internal controls over financial reporting that have come to its attention during the conduct of its audit; |
• | reviewing and discussing with management, internal auditors and independent registered public accounting firm the post-combination company’s financial and critical accounting practices, and policies relating to risk assessment and management; |
• | receiving and reviewing reports of the independent registered public accounting firm discussing (i) all critical accounting matters in the firm’s audit of the post-combination company’s financial statements, (ii) all alternative treatments of financial information within U.S. GAAP that have been discussed with management, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the independent registered public accounting firm, and (iii) other material written communications between the independent registered public accounting firm and management, such as any management letter or schedule of unadjusted differences; |
• | reviewing and discussing with management and the independent registered public accounting firm the annual and quarterly financial statements and section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the post-combination company prior to the filing of the post-combination company’s Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q; |
• | reviewing, or establishing, standards for the type of information and the type of presentation of such information to be included in, earnings press releases and earnings guidance provided to analysts and rating agencies; |
• | discussing with management and the independent registered public accounting firm any changes in post-combination company’s critical accounting principles and the effects of alternative U.S. GAAP methods, off-balance sheet structures and regulatory and accounting initiatives; |
• | reviewing material pending legal proceedings involving the post-combination company and other contingent liabilities; |
• | meeting periodically with the Chief Executive Officer, Chief Financial Officer, the senior internal auditing executive and the independent registered public accounting firm in separate executive sessions to discuss results of examinations; |
• | reviewing and approving all transactions between the post-combination company and related parties or affiliates of the officers of the post-combination company requiring disclosure under Item 404 of Regulation S-K prior to the post-combination company entering into such; |
• | establishing procedures for the receipt, retention and treatment of complaints received by the post-combination company regarding accounting, internal accounting controls or auditing matters, and the confidential, anonymous submissions by employees or contractors of concerns regarding questionable accounting or accounting matters; |
• | reviewing periodically with the post-combination company’s management, the independent registered public accounting firm and outside legal counsel (i) legal and regulatory matters which may have a material effect on the financial statements, and (ii) corporate compliance policies or codes of conduct, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding the post-combination company’s financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities; and |
• | establishing policies for the hiring of employees and former employees of the independent registered public accounting firm. |
• | reviewing the performance of the Chief Executive Officer and executive management; |
• | assisting the post-combination company’s board in developing and evaluating potential candidates for executive positions (including Chief Executive Officer); |
• | reviewing and approving goals and objectives relevant to the Chief Executive Officer and other executive officer compensation, evaluating the Chief Executive Officer’s and other executive officers’ performance in light of these corporate goals and objectives, and setting Chief Executive Officer and other executive officer compensation levels consistent with its evaluation and the post-combination company’s philosophy; |
• | approving the salaries, bonus and other compensation for all executive officers; |
• | reviewing and approving compensation packages for new corporate officers and termination packages for corporate officers as requested by management; |
• | reviewing and discussing with the post-combination company’s board and senior officers plans for officer development and corporate succession plans for the Chief Executive Officer and other senior officers; |
• | reviewing and making recommendations concerning executive compensation policies and plans; |
• | reviewing and recommending to the post-combination company’s board the adoption of or changes to the compensation of the post-combination company’s directors; |
• | reviewing and approving the awards made under any executive officer bonus plan, and providing an appropriate report to the post-combination company’s board; |
• | reviewing and making recommendations concerning long-term incentive compensation plans, including the use of stock options and other equity-based plans, and, except as otherwise delegated by the post-combination company’s board, acting as the “Plan Administrator” for equity-based and employee benefit plans; |
• | approving all special perquisites, special cash payments and other special compensation and benefit arrangements for the post-combination company’s executive officers and employees; |
• | reviewing periodic reports from management on matters relating to the post-combination company’s personnel appointments and practices; |
• | assisting management in complying with the Company’s proxy statement and annual report disclosure requirements; |
• | issuing an annual Report of the Compensation Committee on Executive Compensation for the post-combination company’s annual proxy statement in compliance with applicable SEC rules and regulations; |
• | annually evaluating the committee’s performance and the committee’s charter and recommending to the post-combination company’s board any proposed changes to the charter or the committee; and |
• | undertaking all further actions and discharging all further responsibilities imposed upon the committee from time to time by the post-combination company’s board, the federal securities laws or the rules and regulations of the SEC. |
• | developing and recommending to the post-combination company’s board the criteria for appointment as a director; |
• | identifying, considering, recruiting and recommending candidates to fill new positions on the post-combination company’s board; |
• | reviewing candidates recommended by stockholders; |
• | conducting the appropriate and necessary inquiries into the backgrounds and qualifications of possible candidates; and |
• | recommending director nominees for approval by the post-combination company’s board and election by the stockholders at the next annual meeting. |
Existing Charter |
Proposed Second A&R Charter | |||
Number of Authorized Shares |
The existing Charter provides that the total number of authorized shares of all classes of capital stock is 111,000,000 shares, consisting of (a) 110,000,000 shares of common stock, par value $0.0001 per share, including (i) 100,000,000 shares of Class A Common Stock and (ii) 10,000,000 shares of Class B Common Stock and (b) 1,000,000 shares of Preferred Stock. See Article IV of the existing Charter. |
The Proposed Second A&R Charter will provide that the total number of authorized shares of all classes of capital stock, each with a par value of $0.0001 per share, is shares, consisting of shares of common stock, including shares of Class A Common Stock, and shares of Class B Common Stock, and shares of Preferred Stock. See Article IV of the Proposed Second A&R Charter | ||
Class B Common Stock |
The existing Charter authorizes 10,000,000 shares of Class B Common Stock. Under the existing Charter, shares of Class B Common Stock will automatically convert into shares of Class A Common Stock on a one-for-one basis See Article IV of the existing Charter. |
The Proposed Second A&R Charter authorizes shares of Class B Common Stock. Under the Proposed Second A&R Charter, shares of Class B Common Stock will automatically convert into shares of Class A Common Stock on a one-for-one basis See Article IV of the Proposed Second A&R Charter | ||
Preferred Stock |
The existing Charter provides that shares of Preferred Stock may be issued from time to time in one or more series. The LOKB Board is authorized to fix the voting rights, | The Proposed Second A&R Charter will provide that shares of Preferred Stock may be issued from time to time in one or more series. The post-combination |
Existing Charter |
Proposed Second A&R Charter | |||
|
if any, designations, powers, preferences, and relative, participating, optional, special and other rights, if any, of each such series and any qualifications, limitations and restrictions, applicable to the shares of each series. The LOKB Board is able to, without stockholder approval, issue Preferred Stock with voting and other rights that could adversely affect the voting power and other rights of the holders of Class A Common Stock and Class B Common Stock and could have anti-takeover effects. The ability of the LOKB Board to issue preferred stock without stockholder approval could have the effect of delaying, deferring or preventing a change of control of us or the removal of existing management. We have no Preferred Stock outstanding at the date hereof. | company’s board is authorized to fix the voting rights, if any, designations, powers, preferences, and relative, participating, optional, special and other rights, if any, of each such series and any qualifications, limitations and restrictions, applicable to the shares of each series. The post-combination company’s board is able to, without stockholder approval, issue Preferred Stock with voting and other rights that could adversely affect the voting power and other rights of the holders of Class A Common Stock and Class B Common Stock and could have anti-takeover effects. The ability of the post-combination company’s board to issue preferred stock without stockholder approval could have the effect of delaying, deferring or preventing a change of control of the post-combination company board or the removal of existing management. The issuance of the Preferred Stock could have the effect of decreasing the trading price of the Class A Common Stock, restricting dividends on the capital stock of the post-combination company, diluting the voting power of the Class A Common Stock, or impairing the liquidation rights of the capital stock of the post-combination company. No shares of Preferred Stock are being issued or registered in connection with the Business Combination. Although we do not currently intend to issue any shares of Preferred Stock, we cannot assure you that we will not do so in the future. | ||
Voting Power |
Except as otherwise required by law, the Charter or as otherwise provided in any certificate of designation for any series of preferred stock, the holders of | Except as otherwise required by law, the Proposed Second A&R Charter or as otherwise provided in any certificate of designation for any series of preferred stock, the |
Existing Charter |
Proposed Second A&R Charter | |||
|
Class A Common Stock and Class B Common Stock possess all voting power for the election of our directors and all other matters requiring stockholder action. Holders of Class A Common Stock and Class B Common Stock are entitled to one vote per share on matters to be voted on by stockholders. See Article IV of the existing Charter. |
holders of Class A Common Stock and Class B Common Stock will possess all voting power for the election of our directors and all other matters requiring stockholder action. Holders of Class A Common Stock and Class B Common Stock are entitled to one vote per share on matters to be voted on by stockholders. See Article IV of the Proposed Second A&R Charter | ||
Director Elections |
Currently, the LOKB Board is divided into three classes, each of which will generally serve for a term of three years with only one class of directors being elected at each annual meeting. There is no cumulative voting with respect to the election of directors, with the result that the holders of more than 50% of the shares voted for the election of directors can elect all of the directors. See Article V and Article IX of the existing Charter. |
The post-combination company board will be divided into three classes, Class I, Class II and Class III, each of which will generally serve for a term of three years with only one class of directors being elected at each annual meeting and each class. There will be no cumulative voting with respect to the election of directors, with the result that the holders of more than 50% of the shares voting for the election of directors can elect all of the directors. See Article V of the Proposed Second A&R Charter. | ||
Dividends |
Subject to applicable law, the rights, if any, of the holders of any outstanding series of the Preferred Stock, the holders of shares of Class A Common Stock and Class B Common Stock shall be entitled to receive such dividends and other distributions (payable in cash, property or capital stock of LOKB) when, as and if declared thereon by the LOKB Board from time to time out of any assets or funds of LOKB legally available therefor and shall share equally on a per share basis in such dividends and distributions. | Subject to applicable law, the rights, if any, of the holders of any outstanding series of the Preferred Stock, the holders of shares of Class A Common Stock and Class B Common Stock shall be entitled to receive such dividends and other distributions (payable in cash, property or capital stock of the post-combination company) when, as and if declared thereon by the post-combination company board from time to time out of any assets or funds of the post-combination company legally available therefor and shall share equally on a per share basis in such dividends and distributions. We |
Existing Charter |
Proposed Second A&R Charter | |||
|
|
are not currently contemplating and do not anticipate declaring any stock dividends in the foreseeable future. The ability of the post-combination company to declare dividends may be limited by the terms of any other financing and other agreements entered into by the post-combination company or its subsidiaries from time to time. | ||
Supermajority Voting Provisions |
Under the existing Charter and bylaws, all matters subject to a stockholder vote, except for amendments to Article IX of the Charter prior to an Initial Business Combination, require the affirmative vote of the holders of a majority of the outstanding common stock entitled to vote thereon. Amendment of Article IX of the existing Charter prior to an Initial Business Combination requires the affirmative vote of the holders of at least 65% of all then outstanding shares of common stock. | The Proposed Second A&R Charter will not contain any equivalent provision. | ||
Corporate Opportunity Doctrine |
Under the existing Charter, the doctrine of corporate opportunity does not apply with respect to LOKB or any of its officers, directors or any of their respective affiliates, in circumstances where the application of any such doctrine would conflict with any fiduciary duties or contractual obligations they may have as of the date of the Charter or in the future and LOKB renounces any expectancy that any of the directors or officers of LOKB will offer any such corporate opportunity of which he or she may become aware to LOKB. In addition, the doctrine of corporate opportunity shall not apply to any other corporate opportunity with respect to any of the directors or officers of LOKB unless such corporate opportunity is offered to | Under the Proposed Second A&R Charter, the doctrine of corporate opportunity will not apply with respect to the post-combination company or any of its officers, directors or any of their respective affiliates, in circumstances where the application of any such doctrine would conflict with any fiduciary duties or contractual obligations they may have as of the date of the Proposed Second A&R Charter or in the future and the post-combination company renounces any expectancy that any of the directors or officers of post-combination company will offer any such corporate opportunity of which he or she may become aware to post-combination company. In addition, the doctrine of corporate opportunity shall not apply to any other corporate |
Existing Charter |
Proposed Second A&R Charter | |||
|
such person solely in his or her capacity as a director or officer of LOKB and such opportunity is one LOKB is legally and contractually permitted to undertake and would otherwise be reasonable for LOKB to pursue and the director or officer is permitted to refer that opportunity to LOKB without violating any other legal obligation. | opportunity with respect to any of the directors or officers of post-combination company unless such corporate opportunity is offered to such person solely in his or her capacity as a director or officer of the post-combination company and such opportunity is one the post-combination company is legally and contractually permitted to undertake and would otherwise be reasonable for the post-combination company to pursue and the director or officer is permitted to refer that opportunity to the post-combination company without violating any other legal obligation. | ||
Exclusive Forum |
Unless LOKB consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (a) any derivative action or proceeding brought on behalf of LOKB, (b) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of LOKB to LOKB or LOKB’s stockholders, (c) any action asserting a claim against LOKB, its directors, officers or employees arising pursuant to any provision of the DGCL or the Charter or LOKB’s bylaws or (d) any action asserting a claim against LOKB, its directors, officers or employees governed by the internal affairs doctrine, and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel except for, as to each of (a) through (d) above, any claim as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of | Unless the post-combination company consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (a) any derivative action or proceeding brought on behalf of the post-combination company, (b) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the post-combination company to the post-combination company or the post-combination company’s stockholders, (c) any action asserting a claim against the post-combination company, its directors, officers or employees arising pursuant to any provision of the DGCL or the Proposed Second A&R Charter or the post-combination company’s bylaws or (d) any action asserting a claim against the post-combination company, its directors, officers or employees governed by the internal affairs doctrine, and, if brought outside of Delaware, the stockholder bringing the suit will |
Existing Charter |
Proposed Second A&R Charter | |||
|
the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction. Notwithstanding the foregoing, provisions above will not apply to suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934, the Securities Act of 1933, as amended or any other claim for which the federal courts have exclusive jurisdiction and unless LOKB consents in writing to the selection of an alternative forum, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, or the rules and regulations promulgated thereunder. If any action the subject matter of which is within the scope described above is filed in a court other than a court located within the State of Delaware (a “Foreign Action”) in the name of any stockholder, such stockholder shall be deemed to have consented to (a) the personal jurisdiction of the state and federal courts located within the State of Delaware in connection with any action brought in any such court to enforce the provisions described above (an “FSC Enforcement Action”) and (b) having service of process made upon such stockholder in any such FSC Enforcement Action by |
be deemed to have consented to service of process on such stockholder’s counsel except for, as to each of (a) through (d) above, any claim as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction. Notwithstanding the foregoing, provisions above will not apply to suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934, the Securities Act of 1933, as amended or any other claim for which the federal courts have exclusive jurisdiction and unless the post-combination company consents in writing to the selection of an alternative forum, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, or the rules and regulations promulgated thereunder. If any action the subject matter of which is within the scope described above is filed in a court other than a court located within the State of Delaware (a “Foreign Action”) in the name of any stockholder, such stockholder shall be deemed to have consented to (a) the personal jurisdiction of the state and federal courts located |
Existing Charter |
Proposed Second A&R Charter | |||
|
service upon such stockholder’s counsel in the Foreign Action as agent for such stockholder. See Article XII of the existing Charter. |
within the State of Delaware in connection with any action brought in any such court to enforce the provisions described above (an “FSC Enforcement Action”) and (b) having service of process made upon such stockholder in any such FSC Enforcement Action by service upon such stockholder’s counsel in the Foreign Action as agent for such stockholder. See Article XI of the Proposed Second A&R Charter | ||
Liquidation, Dissolution and Winding Up |
Subject to applicable law, the rights, if any, of the holders of any outstanding series of the Preferred Stock, in the event of any voluntary or involuntary liquidation, dissolution or winding up of LOKB, after payment or provision for payment of the debts and other liabilities of LOKB, the holders of shares of Class A Common Stock and Class B Common Stock shall be entitled to receive all the remaining assets of LOKB available for distribution to its stockholders, ratably in proportion to the number of shares of Class A Common Stock (on an as converted basis with respect to the Class B Common Stock) held by them. | Subject to applicable law, the rights, if any, of the holders of any outstanding series of the Preferred Stock, in the event of any voluntary or involuntary liquidation, dissolution or winding up of the post-combination company, after payment or provision for payment of the debts and other liabilities of the post-combination company, the holders of shares of Class A Common Stock and Class B Common Stock shall be entitled to receive all the remaining assets of LOKB available for distribution to its stockholders, ratably in proportion to the number of shares of Class A Common Stock (on an as converted basis with respect to the Class B Common Stock) held by them. |
• | in whole and not in part; |
• | at a price of $0.01 per warrant; |
• | upon not less than 30 days’ prior written notice of redemption (the “30-day redemption period”) to each warrantholder; and |
• | if, and only if, the reported closing price of the Class A Common Stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending three business days before we send the notice of redemption to the warrant holders. |
• | in whole and not in part; |
• | at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table below, based on the redemption date and the “fair market value” (as defined below) of our Class A Common Stock except as otherwise described below; |
• | if, and only if, the closing price of our Class A Common Stock equals or exceeds $10.00 per public share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “— Warrants — Public Stockholders’ Warrants — Anti-Dilution Adjustments”) for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders; and |
• | if the closing price of our Class A Common Stock for any 20 trading days within a 30-trading day period ending three trading days before we send notice of redemption to the warrant holders is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “— Warrants — Public Shareholders’ Warrants — Anti-dilution Adjustments”), the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above. |
Redemption Date (period to expiration of warrants) |
Fair Market Value of Class A Common Stock |
|||||||||||||||||||||||||||||||||||
£ 10.00 |
11.00 |
12.00 |
13.00 |
14.00 |
15.00 |
16.00 |
17.00 |
³ 18.00 |
||||||||||||||||||||||||||||
60 months |
0.261 | 0.281 | 0.297 | 0.311 | 0.324 | 0.337 | 0.348 | 0.358 | 0.361 | |||||||||||||||||||||||||||
57 months |
0.257 | 0.277 | 0.294 | 0.310 | 0.324 | 0.337 | 0.348 | 0.358 | 0.361 | |||||||||||||||||||||||||||
54 months |
0.252 | 0.272 | 0.291 | 0.307 | 0.322 | 0.335 | 0.347 | 0.357 | 0.361 | |||||||||||||||||||||||||||
51 months |
0.246 | 0.268 | 0.287 | 0.304 | 0.320 | 0.333 | 0.346 | 0.357 | 0.361 | |||||||||||||||||||||||||||
48 months |
0.241 | 0.263 | 0.283 | 0.301 | 0.317 | 0.332 | 0.344 | 0.356 | 0.361 | |||||||||||||||||||||||||||
45 months |
0.235 | 0.258 | 0.279 | 0.298 | 0.315 | 0.330 | 0.343 | 0.356 | 0.361 | |||||||||||||||||||||||||||
42 months |
0.228 | 0.252 | 0.274 | 0.294 | 0.312 | 0.328 | 0.342 | 0.355 | 0.361 | |||||||||||||||||||||||||||
39 months |
0.221 | 0.246 | 0.269 | 0.290 | 0.309 | 0.325 | 0.340 | 0.354 | 0.361 | |||||||||||||||||||||||||||
36 months |
0.213 | 0.239 | 0.263 | 0.285 | 0.305 | 0.323 | 0.339 | 0.353 | 0.361 | |||||||||||||||||||||||||||
33 months |
0.205 | 0.232 | 0.257 | 0.280 | 0.301 | 0.320 | 0.337 | 0.352 | 0.361 | |||||||||||||||||||||||||||
30 months |
0.196 | 0.224 | 0.250 | 0.274 | 0.297 | 0.316 | 0.335 | 0.351 | 0.361 | |||||||||||||||||||||||||||
27 months |
0.185 | 0.214 | 0.242 | 0.268 | 0.291 | 0.313 | 0.332 | 0.350 | 0.361 | |||||||||||||||||||||||||||
24 months |
0.173 | 0.204 | 0.233 | 0.260 | 0.285 | 0.308 | 0.329 | 0.348 | 0.361 | |||||||||||||||||||||||||||
21 months |
0.161 | 0.193 | 0.223 | 0.252 | 0.279 | 0.304 | 0.326 | 0.347 | 0.361 | |||||||||||||||||||||||||||
18 months |
0.146 | 0.179 | 0.211 | 0.242 | 0.271 | 0.298 | 0.322 | 0.345 | 0.361 | |||||||||||||||||||||||||||
15 months |
0.130 | 0.164 | 0.197 | 0.230 | 0.262 | 0.291 | 0.317 | 0.342 | 0.361 | |||||||||||||||||||||||||||
12 months |
0.111 | 0.146 | 0.181 | 0.216 | 0.250 | 0.282 | 0.312 | 0.339 | 0.361 | |||||||||||||||||||||||||||
9 months |
0.090 | 0.125 | 0.162 | 0.199 | 0.237 | 0.272 | 0.305 | 0.336 | 0.361 | |||||||||||||||||||||||||||
6 months |
0.065 | 0.099 | 0.137 | 0.178 | 0.219 | 0.259 | 0.296 | 0.331 | 0.361 | |||||||||||||||||||||||||||
3 months |
0.034 | 0.065 | 0.104 | 0.150 | 0.197 | 0.243 | 0.286 | 0.326 | 0.361 | |||||||||||||||||||||||||||
0 months |
— | — | 0.042 | 0.115 | 0.179 | 0.233 | 0.281 | 0.323 | 0.361 |
• | 1% of the total number of shares of such LOKB securities then-outstanding; or |
• | the average weekly reported trading volume of such LOKB securities during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale. |
• | the issuer of the securities that was formerly a shell company has ceased to be a shell company; |
• | the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act; |
• | the issuer of the securities has filed all Exchange Act reports and materials required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Current Reports on Form 8-K; and |
• | at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company. |
• | each person who is, or is expected to be, the beneficial owner of more than 5% of the outstanding shares of Class A Common Stock; |
• | each of our named executive officers and directors; |
• | each person who will become a named executive officer or director of LOKB post-Business Combination; and |
• | all current executive officers and directors of LOKB, as a group pre-Business Combination and all named executive officers and directors of LOKB post-Business Combination. |
After the Business Combination |
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Prior to the Business Combination |
Assuming No Redemptions Scenario |
Assuming Maximum Redemptions Scenario |
||||||||||||||||||||||
Name and Address of Beneficial Owner |
Number of shares of Common Stock Beneficially Owned(2) |
% |
Number of shares of Common Stock Beneficially Owned |
% |
Number of shares of Common Stock Beneficially Owned |
% |
||||||||||||||||||
Five Percent Holders of LOKB(1) |
||||||||||||||||||||||||
Live Oak Sponsor Partners II, LLC(3)(4) |
6,325,000 | 20.0 | % | 6,325,000 | (5) | 4.5 | % | 6,325,000 | (5) | 5.0 | % | |||||||||||||
Adage Capital Partners, L.P.(6) |
1,980,000 | 6.3 | % | 1,980,000 | 1.4 | % | 1,980,000 | (9) | 1.6 | % | ||||||||||||||
Atalaya Capital Management LP(7) |
1,650,000 | 5.2 | % | 1,650,000 | 1.2 | % | 1,650,000 | (9) | 1.3 | % | ||||||||||||||
Millennium Management LLC(8) |
1,546,482 | 4.9 | % | 1,546,482 | 1.1 | % | 1,546,482 | (9) | 1.2 | % | ||||||||||||||
Directors and Executive Officers of LOKB |
||||||||||||||||||||||||
John P. Amboian |
— | — | — | — | — | — | ||||||||||||||||||
Richard J. Hendrix(3) |
6,325,000 | 20.0 | % | 6,325,000 | (5) | 4.5 | % | 6,325,000 | (5) | 5.0 | % | |||||||||||||
Gary K. Wunderlich, Jr.(3) |
6,325,000 | 20.0 | % | 6,325,000 | (5) | 4.5 | % | 6,325,000 | (5) | 5.0 | % | |||||||||||||
Adam J. Fishman |
— | — | — | — | — | — | ||||||||||||||||||
Andrea Tarbox |
— | — | — | — | — | — | ||||||||||||||||||
Jon Furer |
— | — | — | — | — | — | ||||||||||||||||||
Tor Braham |
— | — | — | — | — | — | ||||||||||||||||||
All Directors and Executive Officers of LOKB as a Group (Seven Individuals) |
6,325,000 | 20.0 | % | 6,325,000 | (5) | 4.5 | % | 6,325,000 | (5) | 5.0 | % | |||||||||||||
Five Percent Holders of Navitas Prior to the Business Combination |
||||||||||||||||||||||||
MalibuIQ, LLC(10) |
— | — | 13,102,681 | 9.2 | % | 13,102,681 | 10.4 | % | ||||||||||||||||
Capricorn-Libra Investment Group, LP(11) |
— | — | 9,589,288 | 6.7 | % | 9,589,288 | 7.6 | % | ||||||||||||||||
Atlantic Bridge III LP(12) |
— | — | 9,841,061 | 6.9 | % | 9,841,061 | 7.8 | % | ||||||||||||||||
Directors and Executive Officers of Post-Business Combination Company |
||||||||||||||||||||||||
Gene Sheridan(13) |
— | — | 5,795,369 | 4.1 | % | 5,795,369 | 4.6 | % | ||||||||||||||||
Daniel Kinzer |
— | — | 4,401,770 | 3.1 | % | 4,401,770 | 3.5 | % | ||||||||||||||||
Brian Long(14) |
— | — | — | — | — | — | ||||||||||||||||||
Dipender Saluja(15) |
— | — | — | — | — | — | ||||||||||||||||||
David Moxam(16) |
— | — | 103,468 | * | 103,468 | * | ||||||||||||||||||
Richard J. Hendrix(3) |
6,325,000 | 20.0 | % | 6,325,000 | (5) | 4.5 | % | 6,325,000 | (5) | 5.0 | % | |||||||||||||
Gary K. Wunderlich Jr.(3) |
6,325,000 | 20.0 | % | 6,325,000 | (5) | 4.5 | % | 6,325,000 | (5) | 5.0 | % | |||||||||||||
All Directors and Executive Officers of Post-Business Combination Company as a Group (7 Individuals) |
6,325,000 | 20.0 | % | 16,625,607 | (5) | 11.7 | % | 16,625,607 | (5) | 13.2 | % |
* | Less than one percent. |
(1) | Unless otherwise noted, the business address of each of the following LOKB entities or individuals is c/o Live Oak Acquisition Corp. II, 40 S. Main Street, #2550, Memphis, TN 38103. |
(2) | Interests shown consist solely of shares of Founders Stock, classified as shares of LOKB Class B common stock. Such shares are convertible into shares of Class A Common Stock on a one-for-one |
(3) | Our sponsor is the record holder of such shares. Each of Messrs. Hendrix and Wunderlich are the managing members of our sponsor, and as such, each have voting and investment discretion with respect to the common stock held of record by our sponsor and may be deemed to have shared beneficial ownership of the common stock held directly by our sponsor. Each of our current officers and directors hold a direct or indirect interest in our sponsor. Each such person disclaims any beneficial ownership of the reported shares other than to the extent of any pecuniary interest they may have therein, directly or indirectly. |
(4) | Certain investment funds and accounts managed by Atalaya Capital Management LP are passive limited members in our sponsor. |
(5) | Includes 1,265,000 shares subject to forfeiture if certain stock price thresholds are not achieved. |
(6) | Shares are held of record by Adage Capital Partners, L.P. (“ACP”) Adage Capital Partners GP, L.L.C. (“ACPGP”) is general partner of ACP. Adage Capital Advisors, L.L.C. (“ACA”) is managing member of ACPGP. Robert Atchinson and Phillip Gross are managing members of ACA. The business address of each of the entities and individuals referenced in this footnote is 200 Clarendon Street, 52nd Floor, Boston, MA 02116. |
(7) | Atalaya Capital Management LP (“ACM”) serves as sub-advisor to Corbin ERISA Opportunity Fund, Ltd. (“Corbin”) and Corbin Opportunity Fund, L.P. (“COF”), and in such capacity, exercises discretionary investment authority over the shares underlying units held directly by Corbin and COF. ACM may be deemed the beneficial owner of 1,650,000 shares underlying units, which amount includes the (i) 953,333 shares underlying units beneficially owned by Corbin and (ii) 476,667 shares underlying units beneficially owned by COF. Each of Corbin Capital Partners Group, LLC (“CCPG”) and Corbin Capital Partners, L.P. (“CCP”) may be deemed the beneficial owner of 1,430,000 shares underlying units. Corbin, CCPG and CCP disclaim beneficial ownership over the shares held directly by ACM. ACM’s business address is One Rockefeller Plaza, 32nd Floor, New York, NY 10020. The business address of each of the other entities referenced in this footnote is 590 Madison Avenue, 31st Floor, New York, NY 10022. |
(8) | Integrated Core Strategies (US) LLC (“Integrated Core Strategies”) beneficially owns 946,482 shares of Class A Common Stock as a result of holding 946,482 of the Company’s units. Riverview Group, LLC (“Riverview”) beneficially owns 375,000 shares of Class A Common Stock as a result of holding 375,000 of the Company’s units. ICS Opportunities, Ltd. (“ICS Opportunities”), beneficially owns 225,000 shares of the Company’s Class A Common Stock as a result of holding 225,000 of the Company’s units, which together with the shares of the Company’s Class A Common Stock beneficially owned by Integrated Core Strategies and Riverview represent 1,546,482 shares of the Company’s Class A Common Stock. Millennium International Management LP (“Millennium International Management”) is the investment manager to ICS Opportunities and may be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities. Millennium Management LLC (“Millennium Management”) is the general partner of the managing member of Integrated Core Strategies and Riverview and may be deemed to have shared voting control and investment discretion over securities owned by Integrated Core Strategies and Riverview. Millennium Management is also the general partner of the 100% owner of ICS Opportunities and may also be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities. Millennium Group Management LLC (“Millennium Group Management”) is the managing member of Millennium Management and may also be deemed to have shared voting control and investment discretion over securities owned by Integrated Core Strategies and Riverview. Millennium Group Management is also the general partner of Millennium International Management and may also be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities. The managing member of Millennium Group Management is a trust of which Israel A. Englander currently serves as the sole voting trustee. Therefore, Mr. Englander may also be deemed to have shared voting control and investment discretion over securities owned by Integrated Core Strategies, Riverview and ICS Opportunities. The foregoing should not be construed in and of itself as an admission by Millennium International Management, Millennium Management, Millennium Group Management or Mr. Englander as to beneficial ownership of the securities owned by Integrated Core Strategies, Riverview or ICS Opportunities, as the case may be. The business address of each of the entities referenced in this footnote and of Mr. Englander is 666 Fifth Avenue, New York, NY 10103. |
(9) | Assumes that these stockholders do not redeem any of their shares of Class A Common Stock in the “Assuming Maximum Redemptions” scenario. Any such redemptions of such shares of Class A Common Stock would reduce the number of shares of Class A Common Stock beneficially owned by these stockholders upon completion of the Business Combination. |
(10) | The business address of MalibuIQ, LLC is 21245 Smith Road, Covington, LA 70435. Includes PIPE Shares to be acquired by an affiliate of MalibuIQ, LLC substantially concurrently with the Closing. |
(11) | Consists of 66% held by Capricorn-Libra Investment Group, LP and 34% held by Technology Impact Fund, LP. Capricorn-Libra Partners, LLC is the general partner of Capricorn-Libra Investment Group, LP. Dipender Saluja is the sole managing member of Capricorn-Libra Partners, LLC. TIF Partners, LLC is the general partner of Technology Impact Fund, LP. TIF Partners, LLC is owned by Dipender Saluja (50%) and Ion Yadigaroglu (50%). The business address of Capricorn-Libra Investment Group, LP, Technology Impact Fund, LP, Capricorn-Libra Partners, LLC and TIF Partners, LLC is 250 University Avenue Palo Alto, CA 94301. |
(12) | Consists of 8,841,061 held beneficially by Atlantic Bridge III LP and 1,000,000 held beneficially by China Ireland Growth Technology Fund II, L.P an affiliate of Atlantic Bridge III LP. Atlantic Bridge III LP is an Irish limited partnership which acts by its general partner, Atlantic Bridge III GP Limited, a company incorporated in Ireland. China Ireland Growth Technology Fund II, L.P. is an Irish limited partnership which acts by its general partner, China Ireland Growth Technology Fund II GP, L.P., which is a limited partnership registered in the Cayman Islands and whose general partner, by which it acts, is China Ireland Growth Technology Fund II GP Limited, a Cayman Islands incorporated company. Atlantic Bridge Services Limited is a 50% shareholder in China Ireland Growth Technology Fund II GP Limited, with directors common to both boards. The Irish entities referenced each have a registered office or place of business at 22 Fitzwilliam Square, Dublin 2, Ireland and the Cayman Islands entities referenced each have a registered office or place of business at PO Box 309, Ugland House, Grand Cayman KY1-1104, Cayman Island. Each of Atlantic Bridge Services Limited, Atlantic Bridge III GP Limited and China Ireland Growth Technology Fund II GP Limited have common directors, some of whom are also shareholders in Atlantic Bridge Services Limited. Brian Long, a director of Navitas Semiconductor Ltd., is a shareholder in Atlantic Bridge Services Limited and is a director of each of Atlantic Bridge III GP Limited and China Ireland Growth Technology Fund II GP Limited. |
(13) | 2,810,713 shares are held of record by The Eugene and Melissa Sheridan Trust. |
(14) | Mr. Long, a member of our board of directors, is Managing Director of Atlantic Bridge III LP. Mr. Long disclaims beneficial ownership of all shares held by Atlantic Bridge III LP and its affiliates referred to above. |
(15) | Mr. Saluja, a member of our board of directors, is Managing Director of Capricorn-Libra Investment Group, LP. Mr. Saluja disclaims beneficial ownership of all shares held by Capricorn-Libra Investment Group, LP referred to above. |
(16) | Mr. Moxam, a member of our board of directors, is Managing Director of MalibuIQ, LLC. Mr. Moxam disclaims beneficial ownership of all shares held by MalibuIQ, LLC and its affiliates referred to above. |
Number of Shares Series B-2 Preferred Stock |
Total Purchase Price ($) |
|||||||
People Better Limited(1) |
2,742,618 | $ | 7,999,997.30 | |||||
Technology Impact Fund, LP(2) |
685,654 | $ | 1.999,997.87 |
(1) | People Better Limited currently holds more than 5% of Navitas’ capital stock. |
(2) | Technology Impact Fund, LP is a current stockholder of Navitas and affiliated with Dipender Saluja, a member of the Navitas Board and anticipated member of the board of directors of the post-combination company. See section entitled “Beneficial Ownership of Securities.” |
• | If the shares are registered in the name of the stockholder, the stockholder should contact LOKB at its offices at 40 S. Main Street, #2550, Memphis, TN 38103, or its telephone number at (901) 685-2865 to inform LOKB of his or her request; or |
• | If a bank, broker or other nominee holds the shares, the stockholder should contact the bank, broker or other nominee directly. |
Page |
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Live Oak Acquisition Corp. II Unaudited Condensed Financial Statements |
||||
F-2 |
||||
F-3 |
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F-4 |
||||
F-5 |
||||
F-6 |
||||
Live Oak Acquisition Corp. II Audited Financial Statements |
||||
F-24 |
||||
F-25 |
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F-26 |
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F-27 |
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F-28 |
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F-29 |
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Navitas Semiconductor Limited Unaudited Condensed Consolidated Financial Statements |
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F-47 | ||||
F-48 | ||||
F-49 | ||||
F-50 | ||||
F-52 | ||||
F-53 | ||||
Navitas Semiconductor Limited Audited Consolidated Financial Statements |
||||
F-72 | ||||
F-74 | ||||
F-75 | ||||
F-76 | ||||
F-77 | ||||
F-78 | ||||
F-79 |
June 30, 2021 |
December 31, 2020 |
|||||||
(Unaudited) |
(Audited) |
|||||||
Assets: |
||||||||
Current assets: |
||||||||
Cash |
$ | $ | ||||||
Prepaid expenses |
||||||||
|
|
|
|
|||||
Total current assets |
||||||||
Investments held in Trust Account |
||||||||
|
|
|
|
|||||
Total Assets |
$ |
$ |
||||||
|
|
|
|
|||||
Liabilities and Stockholders’ Equity: |
||||||||
Current liabilities: |
||||||||
Accrued expenses |
$ | $ | ||||||
Accrued offering costs |
||||||||
|
|
|
|
|||||
Total current liabilities |
||||||||
Deferred underwriting fee payable |
||||||||
Derivative warrant liabilities |
||||||||
|
|
|
|
|||||
Total liabilities |
||||||||
Commitments and Contingencies |
||||||||
Class A common stock subject to possible redemption, |
||||||||
Stockholders’ Equity: |
||||||||
Preferred stock, $ |
||||||||
Class A common stock, $ |
||||||||
Class B common stock, $ |
||||||||
Additional paid-in capital |
||||||||
Accumulated deficit |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total Stockholders’ Equity |
||||||||
|
|
|
|
|||||
Total Liabilities and Stockholders’ Equity |
$ |
$ |
||||||
|
|
|
|
Three Months Ended June 30, 2021 |
Six Months Ended June 30, 2021 |
|||||||
General and administrative expenses |
$ | $ | ||||||
|
|
|
|
|||||
Loss from operations |
( |
) |
( |
) | ||||
Other income (expense): |
||||||||
Change in fair value of derivative warrant liabilities |
( |
) | ( |
) | ||||
Interest — bank |
||||||||
Interest earned on investments held in Trust Account |
||||||||
|
|
|
|
|||||
Total other income (expense), net |
( |
) | ( |
) | ||||
Net loss |
$ |
( |
) |
$ |
( |
) | ||
|
|
|
|
|||||
Weighted average shares outstanding of Class A redeemable common stock |
||||||||
|
|
|
|
|||||
Basic and diluted income per share of Class A redeemable common stock |
$ | $ | ||||||
|
|
|
|
|||||
Weighted average shares outstanding of Class B non-redeemable common stock |
||||||||
|
|
|
|
|||||
Basic and diluted net income per share, Class B non-redeemable common stock |
$ |
( |
) |
$ |
( |
) | ||
|
|
|
|
Class A Common Stock |
Class B Common Stock |
Additional Paid-in Capital |
Retained Earnings (Accumulated Deficit) |
Total Stockholders’ Equity |
||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
|||||||||||||||||||||||||
Balance — January 1, 2021 |
$ |
$ |
$ |
$ |
( |
) |
$ |
|||||||||||||||||||||
Change in value of Class A common stock subject to possible redemption |
( |
) | ( |
) | — | — | ( |
) | — | ( |
) | |||||||||||||||||
Net income |
— | — | — | — | — | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance — March 31, 2021 |
( |
) |
||||||||||||||||||||||||||
Change in value of Class A common stock subject to possible redemption |
— | — | — | |||||||||||||||||||||||||
Net loss |
— | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance — June 30, 2021 |
$ |
$ |
$ |
$ |
( |
) |
$ |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities: |
||||
Net loss |
$ | ( |
) | |
Adjustments to reconcile net income to net cash used in operating activities: |
||||
Changes in fair value of derivative liabilities |
||||
Interest earned on investments held in Trust Account |
( |
) | ||
Changes in operating assets and liabilities: |
||||
Prepaid expenses |
( |
) | ||
Accrued expenses |
||||
|
|
|||
Net cash used in operating activities |
( |
) | ||
|
|
|||
Cash Flows from Financing Activities: |
||||
Payment of offering costs |
( |
) | ||
|
|
|||
Net cash used in financing activities |
( |
) | ||
|
|
|||
Net Change in Cash |
( |
) | ||
Cash — Beginning of period |
||||
|
|
|||
Cash — End of period |
$ |
|||
|
|
|||
Non-Cash financing activities: |
||||
Change in value of Class A common stock subject to possible redemption |
$ |
( |
) | |
|
|
• | Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; |
• | Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and |
• | Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
Three Months Ended June, 30 2021 |
Six Months Ended June 30, 2021 |
|||||||
Redeemable Class A Common Stock |
||||||||
Numerator: Earnings allocable to Redeemable Class A Common Stock |
||||||||
Interest Income |
$ | $ | ||||||
Less: Income and Franchise Tax available to be withdrawn from the Trust Account |
( |
) | ( |
) | ||||
Redeemable Net Earnings |
$ | $ | ||||||
Denominator: Weighted Average Redeemable Class A Common Stock |
||||||||
Redeemable Class A Common Stock, Basic and Diluted |
||||||||
Earnings/Basic and Diluted Redeemable Class A Common Stock |
$ | $ | ||||||
Non-Redeemable Class B Common Stock |
||||||||
Numerator: Net (Loss) Income minus Redeemable Net Earnings |
||||||||
Net (Loss) Income |
$ | ( |
) | $ | ( |
) | ||
Less: Redeemable Net Earnings |
||||||||
Non-Redeemable Net (Loss) Income |
$ | ( |
) | $ | ( |
) | ||
Denominator: Weighted Average Non-Redeemable Class B Common Stock |
||||||||
Non-Redeemable Class B Common Stock, Basic and Diluted(1) |
||||||||
Earnings/Basic and Diluted Non-Redeemable Class B Common Stock |
$ | ( |
) | $ | ( |
) | ||
(1) | For the three and six months ended June 30, 2021, basic and diluted shares were the same as there are no non-redeemable securities that are dilutive to the stockholders. |
• | in whole and not in part; |
• | at a price of $0.01 per warrant; |
• | upon a minimum of 30 days’ prior written notice of redemption; and |
• | if, and only if, the last reported sale price (the “closing price”) of Class A common stock equals or exceeds $18.00 per share (as adjusted) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant-holders. |
• | in whole and not in part; |
• | at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to an agreed table based on the redemption date and the “fair market value” of Class A common stock; |
• | if, and only if, the closing price of Class A common stock equals or exceeds $10.00 per Public Share (as adjusted) for any 20 trading days within the 30-trading day period ending three trading days before the Company sends notice of redemption to the warrant-holders; and |
• | if the closing price of Class A common stock for any 20 trading days within a 30-trading day period ending three trading days before the Company sends notice of redemption to the warrant-holders is less than $18.00 per share (as adjusted), the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above. |
Description |
Level |
June 30, 2021 |
December 31, 2021 |
|||||||||
Assets: |
||||||||||||
Investments held in Trust Account |
1 | $ | $ | |||||||||
Liabilities: |
||||||||||||
Warrant Liability — Public Warrants |
1 | $ | $ | |||||||||
Warrant Liability — Private Placement Warrants |
2 | $ | $ |
December 31, 2020 |
||||
Exercise price |
$ | |||
Stock price |
$ | |||
Term (in years) |
||||
Volatility |
% | |||
Risk-free interest rate |
% | |||
Dividend yield |
% | |||
Probability of completing a Business Combination |
% | |||
Discount for lack of marketability |
% |
Private Placement |
Public |
Warrant Liabilities |
||||||||||
Fair value as of December 31, 2020 |
$ | $ | $ | |||||||||
Change in valuation inputs or other assumptions |
( |
) | ( |
) | ( |
) | ||||||
Transfer to Level 1 |
( |
) | ( |
) | ||||||||
Transfer to Level 2 |
( |
) | ( |
) | ||||||||
Fair value as of June 30, 2021 |
$ | $ | $ |
ASSETS |
||||
Current assets |
||||
Cash |
$ | |||
Prepaid expenses |
||||
Total Current Assets |
||||
Cash and marketable securities held in Trust Account |
||||
Total Assets |
$ |
|||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||
Liabilities |
||||
Current liabilities |
||||
Accrued expenses |
||||
Accrued offering costs |
||||
Total Current Liabilities |
||||
Derivative warrant liabilities |
||||
Deferred underwriting fee payable |
||||
Total Liabilities |
||||
Commitments and contingencies |
||||
Class A common stock subject to possible redemption, |
||||
Stockholders’ Equity |
||||
Preferred stock, $ |
||||
Class A common stock, $ |
||||
Class B common stock, $ |
||||
Additional paid-in capital |
||||
Accumulated deficit |
( |
) | ||
Total Stockholders’ Equity |
||||
Total Liabilities and Stockholders’ Equity |
$ |
|||
General and administrative expenses |
$ | |||
Loss from operations |
( |
) | ||
Other income (expense): |
||||
Change in the fair value of derivative warrant liabilities |
( |
) | ||
Transaction costs allocated to derivative warrant liabilities |
( |
) | ||
Interest income — bank |
||||
Interest earned on investments held in Trust Account |
||||
Other expense, net |
( |
) | ||
Net loss |
$ |
( |
) | |
Weighted average shares outstanding of Class A redeemable common stock |
||||
Basic and diluted net income per share, Class A redeemable common stock |
$ | |||
Weighted average shares outstanding of Class B non-redeemable common stock |
||||
Basic and diluted net loss per share, Class B non-redeemable common stock |
$ | ( |
) | |
Class A Common Stock |
Class B Common Stock |
Additional Paid-in Capital |
Accumulated Deficit |
Total Stockholders’ Equity |
||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
|||||||||||||||||||||||||
Balance — August 12, 2020 (Inception) |
$ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Issuance of Class B common stock to Sponsor |
— | — | — | |||||||||||||||||||||||||
Sale of |
— | — | — | |||||||||||||||||||||||||
Excess of proceeds received over fair value of private placement warrants |
— | — | — | — | — | |||||||||||||||||||||||
Class A common stock subject to possible redemption |
( |
) | ( |
) | — | — | ( |
) | — | ( |
) | |||||||||||||||||
Net loss |
— | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||
Balance — December 31, 2020 |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
||||||||||||||||||||
Cash Flows from Operating Activities: |
||||
Net loss |
$ | ( |
) | |
Adjustments to reconcile net loss to net cash used in operating activities: |
||||
Change in fair value of derivative liabilities |
||||
Transaction costs allocated to derivative warrant liabilities |
||||
Interest earned on investments held in Trust Account |
( |
) | ||
Changes in operating assets and liabilities: |
||||
Prepaid expenses |
( |
) | ||
Accrued expenses |
||||
Net cash used in operating activities |
( |
) | ||
Cash Flows from Investing Activities: |
||||
Investment of cash into Trust Account |
( |
) | ||
Net cash used in investing activities |
( |
) | ||
Cash Flows from Financing Activities: |
||||
Proceeds from issuance of Class B common stock to Sponsor |
||||
Proceeds from sale of Units, net of underwriting discounts paid |
||||
Proceeds from sale of Private Placement Warrants |
||||
Proceeds from promissory note — related party |
||||
Repayment of promissory note — related party |
( |
) | ||
Payment of offering costs |
( |
) | ||
Net cash provided by financing activities |
||||
Net Change in Cash |
||||
Cash — Beginning of period |
||||
Cash — End of period |
$ |
|||
Non-Cash financing activities: |
||||
Initial classification of Class A common stock subject to possible redemption |
||||
Change in value of Class A common stock subject to possible redemption |
( |
) | ||
Deferred underwriting fee payable |
||||
Offering costs included in accrued offering costs |
$ | |||
As of December 31, 2020 |
||||||||||||
As Previously Reported |
Restatement Adjustment |
As Restated |
||||||||||
Balance Sheet |
||||||||||||
Derivative warrant liabilities |
$ | — | $ | $ | ||||||||
Total Liabilities |
||||||||||||
Class A common stock subject to possible redemption |
( |
) | ||||||||||
Class A common stock |
||||||||||||
Additional paid-in-capital |
||||||||||||
Accumulated deficit |
( |
) | ( |
) | ( |
) | ||||||
Total stockholders’ equity |
$ | $ | ( |
) | $ |
Period From August 12, 2020 (Inception) Through December 31, 2020 |
||||||||||||
As Previously Reported |
Restatement Adjustment |
As Restated |
||||||||||
Statement of Operations |
||||||||||||
Change in fair value of derivative warrant liabilities |
$ | — | $ | ( |
) | $ | ( |
) | ||||
Transaction costs allocated to derivative warrant liabilities |
— | ( |
) | ( |
) | |||||||
Net loss |
( |
) | ( |
) | ( |
) | ||||||
Weighted-average shares outstanding of Class A common stock |
— | |||||||||||
Basic and Diluted income per share, Class A common stock |
— | |||||||||||
Weighted-average shares outstanding of Class B common stock |
— | |||||||||||
Basic and Diluted net loss per share, Class B non-redeemable common stock |
$ | ( |
) | $ | ( |
) | $ | ( |
) |
Period From August 12, 2020 (Inception) Through December 31, 2020 |
||||||||||||
As Previously Reported |
Restatement Adjustment |
As Restated |
||||||||||
Statement of Cash Flows |
||||||||||||
Net loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Change in value of derivative warrant liabilities |
— | |||||||||||
Financing Costs — derivative warrant liabilities |
— | |||||||||||
Initial value of Class A common stock subject to possible redemption |
( |
) | ||||||||||
Change in value of Class A common stock subject to possible redemption |
$ | ( |
) | $ | ( |
) | $ | ( |
) |
For the Period From August 12, 2020 (inception) Through December 31, 2020 |
||||
Redeemable Class A Common Stock |
||||
Numerator: Earnings allocable to Redeemable Class A Common Stock |
||||
Interest Income |
$ | |||
Income and Franchise Tax |
( |
) | ||
|
|
|||
Net Earnings |
— | |||
Denominator: Weighted Average Redeemable Class A Common Stock |
||||
Redeemable Class A Common Stock, Basic and Diluted |
||||
Earnings/Basic and Diluted Redeemable Class A Common Stock |
||||
Non-Redeemable Class B Common Stock |
||||
Numerator: Net Loss minus Redeemable Net Earnings |
||||
Net Loss |
( |
) | ||
Redeemable Net Earnings |
— | |||
|
|
|||
Non-Redeemable Net Loss |
( |
) | ||
Denominator: Weighted Average Non-Redeemable Common Stock |
||||
Non-Redeemable Class B Common Stock, Basic and Diluted |
||||
Loss/Basic and Diluted Non-Redeemable Class B Common Stock |
$ | ( |
) |
• |
in whole and not in part; |
• | at a price of $ |
• | upon not less than 30 days’ prior written notice of redemption to each warrant holder; and |
• | if, and only if, the reported closing price of the Class A common stock equals or exceeds $ 30-trading day period ending three business days before the Company sends the notice of redemption to the warrant holders. |
• |
in whole and not in part; |
• | at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares based on the redemption date and the fair market value of the Class A common stock; |
• | if, and only if, the closing price of the Class A common stock equals or exceeds $ 10.00 per public share (as adjusted) for any 20 trading days within the 30-trading day period ending three trading days before the Company sends the notice of redemption to the warrant holders; and |
• | if the closing price of the Class A common stock for any 20 trading days within a 30-trading day period ending three trading days before the Company sends notice of redemption to the warrant holders is less than $18.00 per share (as adjusted), the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above. |
Deferred tax asset |
||||
Net operating loss carryforward |
$ | |||
Organizational costs/startup expenses |
||||
Total deferred tax asset |
||||
Valuation allowance |
( |
) | ||
Deferred tax asset, net |
$ | |||
Federal |
||||
Current |
$ | |||
Deferred |
( |
) | ||
State |
||||
Current |
$ | |||
Deferred |
||||
Change in valuation allowance |
||||
Income tax provision |
$ | |||
Statutory federal income tax rate |
% | |||
Change in fair value of derivative warrant liabilities |
( |
)% | ||
Transaction costs allocated to derivative warrant liabilities |
( |
)% | ||
State taxes, net of federal tax benefit |
% | |||
Change in valuation allowance |
( |
)% | ||
Income tax provision |
% | |||
Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |
Level 3: | Unobservable inputs based on an assessment of the assumptions that market participants would use in pricing the asset or liability. |
Held-To-Maturity |
Amortized Cost |
Gross Holding Loss |
Fair Value |
|||||||||
$ | $ | ( |
) | $ |
Level |
December 31, 2020 |
|||||||
Assets: |
||||||||
Cash and marketable securities held in Trust Account |
1 | $ | ||||||
Liabilities: |
||||||||
Warrant Liabilities — Public Warrants |
3 | $ | ||||||
Warrant Liabilities — Private Placement Warrants |
3 | $ |
December 7, 2020 |
December 31, 2020 |
|||||||
Stock Price |
$ | $ | ||||||
Exercise Price |
$ | $ | ||||||
Volatility |
% | % | ||||||
Expected life of the options to convert (in years) |
||||||||
Risk-free rate |
% | % | ||||||
Dividend yield |
% | % |
Private Placement |
Public |
Warrant Liabilities |
||||||||||
Fair value as of August 12, 2020 (inception) |
$ | $ | $ | |||||||||
Initial measurement on December 7, 2020 (including over-allotment) |
||||||||||||
Change in fair value |
||||||||||||
Fair value as of December 31, 2020 |
$ | $ | $ | |||||||||
(In thousands, except shares and par value) |
June 30, 2021 |
December 31, 2020 |
||||||
ASSETS |
||||||||
CURRENT ASSETS: |
||||||||
Cash and cash equivalents |
$ | 23,848 | $ | 38,869 | ||||
Accounts receivable, net |
4,501 | 4,152 | ||||||
Inventory |
7,924 | 3,404 | ||||||
Prepaid expenses and other current assets |
2,902 | 522 | ||||||
|
|
|
|
|||||
Total current assets |
39,175 | 46,947 | ||||||
PROPERTY AND EQUIPMENT, net |
1,180 | 722 | ||||||
INTANGIBLE ASSETS, net |
344 | 515 | ||||||
NOTES RECEIVABLE |
215 | 221 | ||||||
OTHER ASSETS |
223 | 102 | ||||||
|
|
|
|
|||||
Total assets |
$ | 41,137 | $ | 48,507 | ||||
|
|
|
|
|||||
LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) |
||||||||
CURRENT LIABILITIES: |
||||||||
Accounts payable and other accrued expenses |
$ | 7,688 | $ | 3,698 | ||||
Accrued compensation expenses |
1,582 | 1,668 | ||||||
Current portion of long-term debt |
2,200 | 1,000 | ||||||
|
|
|
|
|||||
Total current liabilities |
11,470 | 6,366 | ||||||
LONG-TERM DEBT |
3,778 | 4,971 | ||||||
OTHER LIABILITIES |
66 | 88 | ||||||
|
|
|
|
|||||
Total liabilities |
15,314 | 11,425 | ||||||
COMMITMENTS AND CONTINGENCIES (Note 12) |
||||||||
REDEEMABLE CONVERTIBLE PREFERRED STOCK: |
||||||||
Series A convertible preferred stock, $0.0001 par value; 16,716,348 shares authorized and 16,620,018 shares issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $17,451 at June 30, 2021 and December 31, 2020, respectively |
14,970 | 14,970 | ||||||
Series B convertible preferred stock, $0.0001 par value; 14,262,664 shares authorized, 14,213,431 shares issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $27,574 at June 30, 2021 and December 31, 2020, respectively |
27,371 | 27,371 | ||||||
Series B-1 convertible preferred stock, $0.0001 par value; 6,133,979 shares authorized, 5,416,551 shares issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $15,112 at June 30, 2021 and December 31, 2020, respectively |
14,786 | 14,786 | ||||||
Series B-2 convertible preferred stock, $0.0001 par value; 24,027,913 shares authorized, 18,198,891 shares issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $53,085 at June 30, 2021 and December 31, 2020 |
52,379 | 52,379 | ||||||
STOCKHOLDERS’ EQUITY (DEFICIT): |
||||||||
Common stock, $0.0001 par value, 93,000,000 shares authorized as of June 30, 2021 and December 31, 2020, 16,345,028 and 15,327,160 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively |
3 | 2 | ||||||
Additional paid-in capital |
18,295 | 3,557 | ||||||
Accumulated other comprehensive income (loss) |
(4 | ) | (1 | ) | ||||
Accumulated deficit |
(101,977 | ) | (75,982 | ) | ||||
|
|
|
|
|||||
Total stockholders’ equity (deficit) |
(83,683 | ) | (72,424 | ) | ||||
|
|
|
|
|||||
Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit) |
$ | 41,137 | $ | 48,507 | ||||
|
|
|
|
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
(In thousands, except per share amounts) |
2021 |
2020 |
2021 |
2020 |
||||||||||||
NET REVENUES |
$ | 5,450 | $ | 2,516 | $ | 10,767 | $ | 3,696 | ||||||||
COST OF REVENUES |
2,971 | 1,871 | 5,930 | 2,843 | ||||||||||||
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|
|
|
|
|
|
|
|||||||||
GROSS PROFIT |
2,479 | 645 | 4,837 | 853 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
OPERATING EXPENSES: |
||||||||||||||||
Research and development |
6,267 | 2,636 | 10,521 | 5,080 | ||||||||||||
Selling, general and administrative |
14,794 | 1,887 | 20,163 | 3,383 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total operating expenses |
21,061 | 4,523 | 30,684 | 8,463 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
LOSS FROM OPERATIONS |
(18,582 | ) | (3,878 | ) | (25,847 | ) | (7,610 | ) | ||||||||
INTEREST EXPENSE, net of interest income of $1, $1, $3 and $2 |
(63 | ) | (56 | ) | (124 | ) | (109 | ) | ||||||||
|
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|
|
|
|
|
|
|||||||||
LOSS BEFORE INCOME TAXES |
(18,645 | ) | (3,934 | ) | (25,971 | ) | (7,719 | ) | ||||||||
PROVISION FOR INCOME TAXES |
5 | — | 24 | 6 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
NET LOSS |
$ | (18,650 | ) | $ | (3,934 | ) | $ | (25,995 | ) | $ | (7,725 | ) | ||||
|
|
|
|
|
|
|
|
|||||||||
NET LOSS PER COMMON SHARE: |
||||||||||||||||
Basic and diluted |
$ | (0.98 | ) | $ | (0.27 | ) | $ | (1.40 | ) | $ | (0.52 | ) | ||||
|
|
|
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|
|
|
|
|||||||||
COMMON SHARES USED IN PER SHARE CALCULATION: |
||||||||||||||||
Basic and diluted |
19,097 | 14,835 | 18,571 | 14,820 | ||||||||||||
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
(In thousands) |
2021 |
2020 |
2021 |
2020 |
||||||||||||
Net loss |
$ | (18,650 | ) | $ | (3,934 | ) | $ | (25,995 | ) | $ | (7,725 | ) | ||||
Other comprehensive income (loss), net of tax: |
||||||||||||||||
Foreign currency translation adjustments, net of tax |
(3 | ) | — | (4 | ) | — | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total other comprehensive income (loss) |
(3 | ) | — | (4 | ) | — | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
TOTAL COMPREHENSIVE LOSS |
$ | (18,653 | ) | $ | (3,934 | ) | $ | (25,999 | ) | $ | (7,725 | ) | ||||
|
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|
|
|
|
|
|
Redeemable convertible preferred stock | Stockholder’s equity (deficit) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series A redeemable convertible preferred stock |
Series B redeemable convertible preferred stock |
Series B-1 redeemable convertible preferred stock |
Series B-2 redeemable convertible preferred stock |
Common stock | Additional paid in capital |
Accumulated deficit |
Notes receivable- shareholders |
Accumulated comprehensive income (loss) |
Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) |
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE AT March 31, 2020 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | 1,886 | $ | 5,485 | 14,835 | $ | 1 | $ | 2,558 | $ | (60,729 | ) | $ | — | $ | — | $ | (58,170 | ) | |||||||||||||||||||||||||||||||||
Issuance of common stock under employee stock option and stock award plans |
— | — | — | — | — | — | — | — | 6 | — | 2 | — | — | — | 2 | |||||||||||||||||||||||||||||||||||||||||||||
Issuance of preferred stock |
— | — | — | — | — | — | 10,056 | 29,335 | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock issuance costs |
— | — | — | — | — | — | — | (80 | ) | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense related to stock awards |
— | — | — | — | — | — | — | — | — | — | 3 | — | — | — | 3 | |||||||||||||||||||||||||||||||||||||||||||||
Issuance of warrants |
16 | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | — | — | — | (3,934 | ) | — | — | (3,934 | ) | |||||||||||||||||||||||||||||||||||||||||||
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BALANCE AT June 30, 2020 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | 11,942 | $ | 34,740 | 14,841 | $ | 1 | $ | 2,579 | $ | (64,663 | ) | $ | — | $ | — | $ | (62,083 | ) | |||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||||||||
Series A redeemable convertible preferred stock |
Series B redeemable convertible preferred stock |
Series B-1 redeemable convertible preferred stock |
Series B-2 redeemable convertible preferred stock |
Common stock | Additional paid in capital |
Accumulated deficit |
Notes receivable- shareholders |
Accumulated comprehensive income (loss) |
Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2019 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | — | $ | — | 14,655 | $ | 1 | $ | 2,479 | $ | (56,938 | ) | $ | — | $ | — | $ | (54,458 | ) | |||||||||||||||||||||||||||||||||
Issuance of common stock under employee stock option and stock award plans |
— | — | — | — | — | — | — | — | 186 | — | 26 | — | — | — | 26 | |||||||||||||||||||||||||||||||||||||||||||||
Issuance of preferred stock |
— | — | — | — | — | — | 11,942 | 34,835 | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock issuance costs |
— | — | — | — | — | — | — | (95 | ) | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense related to employee and non-employee stock awards |
— | — | — | — | — | — | — | — | — | — | 58 | — | — | — | 58 | |||||||||||||||||||||||||||||||||||||||||||||
Issuance of warrants |
— | — | — | — | — | — | — | — | — | — | 16 | — | — | — | 16 | |||||||||||||||||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | — | — | — | (7,725 | ) | — | — | (7,725 | ) | |||||||||||||||||||||||||||||||||||||||||||
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BALANCE AT June 30, 2020 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | 11,942 | $ | 34,740 | 14,841 | $ | 1 | $ | 2,579 | $ | (64,663 | ) | $ | — | $ | — | $ | (62,083 | ) | |||||||||||||||||||||||||||||||||
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Redeemable convertible preferred stock | Stockholder’s equity (deficit) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series A redeemable convertible preferred stock |
Series B redeemable convertible preferred stock |
Series B-1 redeemable convertible preferred stock |
Series B-2 redeemable convertible preferred stock |
Common stock | Additional paid in capital |
Accumulated deficit |
Notes receivable- shareholders |
Accumulated comprehensive income (loss) |
Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) |
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE AT March 31, 2021 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | 18,199 | $ | 52,379 | 20,666 | $ | 3 | $ | 6,797 | $ | (83,327 | ) | $ | (1,183 | ) | $ | (2 | ) | $ | (77,712 | ) | |||||||||||||||||||||||||||||||
Issuance of common stock under employee stock option and stock award plans |
— | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense related to employee and non-employee stock awards |
— | — | — | — | — | — | — | — | — | — | 12,729 | — | — | — | 12,729 | |||||||||||||||||||||||||||||||||||||||||||||
Recission of common stock |
— | — | — | — | — | — | — | — | (4,321 | ) | — | (1,231 | ) | — | 1,183 | — | (48 | ) | ||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment |
— | — | — | — | — | — | — | — | — | — | — | — | — | (2 | ) | (2 | ) | |||||||||||||||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | — | — | — | (18,650 | ) | — | — | (18,650 | ) | |||||||||||||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||||||||
BALANCE AT June 30, 2021 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | 18,199 | $ | 52,379 | 16,345 | $ | 3 | $ | 18,295 | $ | (101,977 | ) | $ | — | $ | (4 | ) | $ | (83,683 | ) | ||||||||||||||||||||||||||||||||
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|||||||||||||||||||||||||||||||
Series A redeemable convertible preferred stock |
Series B redeemable convertible preferred stock |
Series B-1 redeemable convertible preferred stock |
Series B-2 redeemable convertible preferred stock |
Common stock | Additional paid in capital |
Accumulated deficit |
Notes receivable- shareholders |
Accumulated comprehensive income (loss) |
Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2020 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | 18,199 | $ | 52,379 | 15,327 | $ | 2 | $ | 3,557 | $ | (75,982 | ) | $ | — | $ | (1 | ) | $ | (72,424 | ) | ||||||||||||||||||||||||||||||||
Issuance of common stock under employee stock option and stock award plans |
— | — | — | — | — | — | — | — | 5,339 | 1 | 1,405 | — | (1,183 | ) | — | 223 | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense related to employee and non-employee stock awards |
— | — | — | — | — | — | — | — | — | — | 14,564 | — | — | — | 14,564 | |||||||||||||||||||||||||||||||||||||||||||||
Recission of common stock awards |
— | — | — | — | — | — | — | — | (4,321 | ) | — | (1,231 | ) | — | 1,183 | — | (48 | ) | ||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment |
— | — | — | — | — | — | — | — | — | — | — | — | — | (3 | ) | (3 | ) | |||||||||||||||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | — | — | — | (25,995 | ) | — | — | (25,995 | ) | |||||||||||||||||||||||||||||||||||||||||||
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BALANCE AT JUNE 30, 2021 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | 18,199 | $ | 52,379 | 16,345 | $ | 3 | $ | 18,295 | $ | (101,977 | ) | $ | — | $ | (4 | ) | $ | (83,683 | ) | ||||||||||||||||||||||||||||||||
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Six Months Ended June 30, |
||||||||
(In thousands) |
2021 |
2020 |
||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
Net loss |
$ | (25,995 | ) | $ | (7,725 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
Depreciation |
166 | 192 | ||||||
Amortization of intangibles |
167 | — | ||||||
Other non-cash (income) expenses |
(1 | ) | (1 | ) | ||||
Amortization of deferred rent |
(22 | ) | 7 | |||||
Stock-based compensation expense |
14,564 | 58 | ||||||
Amortization of debt discount and issuance costs |
6 | 2 | ||||||
Change in operating assets and liabilities: |
||||||||
Accounts receivable |
(349 | ) | (1,325 | ) | ||||
Inventory |
(4,520 | ) | (731 | ) | ||||
Prepaid expenses and other current assets |
(2,230 | ) | 16 | |||||
Other assets |
(121 | ) | — | |||||
Accounts payable, accrued compensation and other expenses |
4,562 | 650 | ||||||
Deferred revenue |
— | (86 | ) | |||||
|
|
|
|
|||||
Net cash used in operating activities |
(13,773 | ) | (8,943 | ) | ||||
|
|
|
|
|||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
Asset acquisition |
(680 | ) | — | |||||
Investment purchases |
(150 | ) | — | |||||
Purchases of property and equipment |
(641 | ) | (144 | ) | ||||
Repayment of notes receivable |
2 | — | ||||||
|
|
|
|
|||||
Net cash used in investing activities |
(1,469 | ) | (144 | ) | ||||
|
|
|
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
Proceeds from issuance of preferred stock |
— | 34,835 | ||||||
Payment of preferred stock issuance costs |
— | (95 | ) | |||||
Proceeds from issuance of common stock in connection with stock options exercised |
222 | 26 | ||||||
Proceeds from issuance of long-term debt |
— | 6,000 | ||||||
Principal payments on long-term debt |
— | (4,800 | ) | |||||
|
|
|
|
|||||
Net cash provided by financing activities |
222 | 35,966 | ||||||
|
|
|
|
|||||
Effect of exchange rate changes on cash |
(1 | ) | — | |||||
|
|
|
|
|||||
NET INCREASE (DECREASE) IN CASH, CASH-EQUIVALENTS AND RESTRICTED CASH |
(15,021 | ) | 26,879 | |||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD |
38,869 | 6,118 | ||||||
|
|
|
|
|||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD |
$ | 23,848 | $ | 32,997 | ||||
|
|
|
|
June 30, 2021 |
December 31, 2020 |
June 30, 2020 |
December 31, 2019 |
|||||||||||||
Cash and cash equivalents |
$ | 23,848 | $ | 38,869 | $ | 32,997 | $ | 5,970 | ||||||||
Restricted cash |
— | — | — | 148 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total cash, cash equivalents and restricted cash |
$ | 23,848 | $ | 38,869 | $ | 32,997 | $ | 6,118 | ||||||||
|
|
|
|
|
|
|
|
June 30, 2021 |
December 31, 2020 |
|||||||
Furniture and fixtures |
$ | 164 | $ | 164 | ||||
Computers and other equipment |
2,111 | 1,591 | ||||||
Leasehold improvements |
256 | 135 | ||||||
|
|
|
|
|||||
2,531 | 1,890 | |||||||
Accumulated depreciation |
(1,351 | ) | (1,168 | ) | ||||
|
|
|
|
|||||
Total |
$ | 1,180 | $ | 722 | ||||
|
|
|
|
Furniture and fixtures |
3 – 7 years | |||
Computers and other equipment |
2 – 5 years | |||
Leasehold improvements |
2 – 5 years |
June 30, 2021 |
December 31, 2020 |
|||||||
Raw materials |
$ | 3,432 | $ | 1,042 | ||||
Work-in-process |
3,877 | 1,991 | ||||||
Finished goods |
615 | 371 | ||||||
|
|
|
|
|||||
Total |
$ | 7,924 | $ | 3,404 | ||||
|
|
|
|
June 30, 2021 |
December 31, 2020 |
|||||||
Note payable |
$ | 6,000 | $ | 6,000 | ||||
Less: Current portion |
(2,200 | ) | (1,000 | ) | ||||
Less: Debt discount and issuance costs |
(22 | ) | (29 | ) | ||||
|
|
|
|
|||||
Note payable, net of current portion |
$ | 3,778 | $ | 4,971 | ||||
|
|
|
|
Fiscal Year |
||||
Remainder of 2021 |
$ | 1,000 | ||
2022 |
2,400 | |||
2023 |
2,400 | |||
2024 |
200 | |||
2025 |
— | |||
Thereafter |
— | |||
|
|
|||
Total |
$ | 6,000 | ||
|
|
Three Months Ended June 30 |
Six Months Ended June 30 |
|||||||||||||||
(In thousands) |
2021 |
2020 |
2021 |
2020 |
||||||||||||
Cost of revenues |
$ | 50 | $ | — | $ | 163 | $ | — | ||||||||
Research and development |
1,424 | 12 | 1,630 | 24 | ||||||||||||
Selling, general and administrative |
11,255 | 12 | 12,771 | 34 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total stock-based compensation expense |
$ | 12,729 | $ | 24 | $ | 14,564 | $ | 58 | ||||||||
|
|
|
|
|
|
|
|
2021 |
||||
Risk-free interest rates |
0.42 | % | ||
Expected volatility rates |
44 | % | ||
Expected dividend yield |
— | |||
Expected term (in years) |
6 | |||
Weighted-average grant date fair value of options |
$ | 0.48 |
Shares (In thousands) |
Weighted- Average Exercise Price |
Weighted- Average Remaining Contractual Term (In years) |
||||||||||
Outstanding at December 31, 2020 |
11,861 | $ | 0.51 | 7.8 | ||||||||
Granted |
190 | 1.16 | ||||||||||
Exercised |
(1,019 | ) 1 |
0.17 | |||||||||
Forfeited or expired |
(53 | ) | 1.14 | |||||||||
Cancelled |
(135 | ) | 1.16 | |||||||||
|
|
|
|
|||||||||
Outstanding at June 30, 2021 |
10,844 | $ | 0.54 | 7.4 | ||||||||
|
|
|
|
|||||||||
Vested and Exercisable at June 30, 2021 |
6,119 | $ | 0.27 | 6.8 | ||||||||
|
|
|
|
1 | Net of 240 options exercised in the first quarter of 2021 which were subsequently rescinded in the three months ended June 30, 2021. |
Shares (In thousands) |
Weighted Average Fair Value |
|||||||
Unvested options outstanding at December 31, 2020 |
5,935 | $ | 0.33 | |||||
Granted |
190 | 0.48 | ||||||
Vested |
(1,212 | ) | 0.23 | |||||
Forfeited or expired |
(53 | ) | 0.47 | |||||
Cancelled |
(135 | ) | 0.48 | |||||
|
|
|||||||
Unvested options outstanding at June 30, 2021 |
4,725 | $ | 0.36 | |||||
|
|
Shares (In thousands) |
Weighted-Average Issuance Price |
Weighted-Average Grant Date Fair Value Per Share |
||||||||||
Outstanding at December 31, 2020 |
— | $ | — | $ | — | |||||||
Granted |
4,081 | (1) |
0.29 | 5.53 | ||||||||
Vested |
— | (1) |
— | — | ||||||||
Forfeited |
— | — | — | |||||||||
Rescinded |
(4,081 | ) | 0.29 | 5.53 | ||||||||
|
|
|
|
|
|
|||||||
Outstanding at June 30, 2021 |
— | $ | — | $ | — | |||||||
|
|
|
|
|
|
(1) | All shares awarded, both vested and unvested, were rescinded for no consideration in the second quarter of 2021. |
Six Months Ended June 30, |
||||||||
Customer |
2021 |
2020 |
||||||
Distributor A |
21 | % | 64 | % | ||||
Distributor B |
20 | * | ||||||
Distributor C |
19 | 14 | ||||||
Distributor D |
38 | * | ||||||
Distributor E. |
3 | 13 |
* | Total customer revenue was less than 10% of net revenues. |
As of June 30, |
||||||||
Customer |
2021 |
2020 |
||||||
Distributor A |
33 | % | 74 | % | ||||
Distributor B |
* | * | ||||||
Distributor C |
22 | 10 | ||||||
Distributor D |
43 | * | ||||||
Distributor E |
* | 15 |
* | Total customer accounts receivable was less than 10% of net accounts receivables. |
June 30, 2021 |
||||
Remainder of 2021 |
$ | 548 | ||
2022 |
911 | |||
2023 |
531 | |||
2024 |
154 | |||
2025 |
— | |||
Thereafter |
— | |||
|
|
|||
Total future minimum lease payments |
$ | 2,144 | ||
|
|
June 30, 2021 |
December 31, 2020 |
|||||||
Notes receivable — employee |
$ | 215 | $ | 221 |
(In thousands, except shares and par value) |
December 31, 2020 |
December 31, 2019 |
||||||
ASSETS |
||||||||
CURRENT ASSETS: |
||||||||
Cash and cash equivalents |
$ | 38,869 | $ | 5,970 | ||||
Restricted cash |
— | 148 | ||||||
Accounts receivable, net |
4,152 | 698 | ||||||
Inventory |
3,404 | 699 | ||||||
Prepaid expenses and other current assets |
522 | 236 | ||||||
|
|
|
|
|||||
Total current assets |
46,947 | 7,751 | ||||||
PROPERTY AND EQUIPMENT, net |
722 | 882 | ||||||
INTANGIBLE ASSETS, net |
515 | — | ||||||
NOTES RECEIVABLE |
221 | 229 | ||||||
OTHER ASSETS |
102 | 97 | ||||||
|
|
|
|
|||||
Total assets |
$ | 48,507 | $ | 8,959 | ||||
|
|
|
|
|||||
LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) |
||||||||
CURRENT LIABILITIES: |
||||||||
Accounts payable and other accrued expenses |
$ | 3,698 | $ | 871 | ||||
Accrued compensation expenses |
1,668 | 259 | ||||||
Deferred revenue |
— | 288 | ||||||
Current portion of long-term debt |
1,000 | 2,400 | ||||||
|
|
|
|
|||||
Total current liabilities |
6,366 | 3,818 | ||||||
LONG-TERM DEBT |
4,971 | 2,400 | ||||||
OTHER LIABILITIES |
88 | 68 | ||||||
|
|
|
|
|||||
Total liabilities |
11,425 | 6,286 | ||||||
COMMITMENTS AND CONTINGENCIES (Note12) |
||||||||
REDEEMABLE CONVERTIBLE PREFERRED STOCK: |
||||||||
Series A convertible preferred stock, $0.0001 par value; 16,716,348 shares authorized and 16,620,018 shares issued and outstanding at December 31, 2020 and 2019; liquidation preference of $17,451 at December 31, 2020 and 2019, respectively |
14,970 | 14,970 | ||||||
Series B convertible preferred stock, $0.0001 par value; 14,262,664 shares authorized, 14,213,431 shares issued and outstanding at December 31, 2020 and 2019; liquidation preference of $27,574 at December 31, 2020 and 2019, respectively |
27,371 | 27,371 | ||||||
Series B-1 convertible preferred stock, $0.0001 par value; 6,133,979 shares authorized, 5,416,551 shares issued and outstanding at December 31, 2020 and 2019; liquidation preference of $15,112 at December 31, 2020 and 2019, respectively |
14,786 | 14,786 | ||||||
Series B-2 convertible preferred stock, $0.0001 par value; 24,027,913 shares authorized, 18,198,891 and nil shares issued and outstanding at December 31, 2020 and 2019, respectively; liquidation preference of $53,085 at December 31, 2020 |
52,379 | — | ||||||
STOCKHOLDERS’ EQUITY (DEFICIT): |
||||||||
Common stock, $0.0001 par value, 93,000,000 and 63,000,000 shares authorized as of December 31, 2020 and 2019, respectively, 15,327,160 and 14,654,640 shares issued and outstanding at December 31, 2020 and 2019, respectively |
2 | 1 | ||||||
Additional paid-in capital |
3,557 | 2,483 | ||||||
Accumulated other comprehensive income (loss) |
(1 | ) | — | |||||
Accumulated deficit |
(75,982 | ) | (56,938 | ) | ||||
|
|
|
|
|||||
Total stockholders’ equity (deficit) |
(72,424 | ) | (54,454 | ) | ||||
|
|
|
|
|||||
Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit) |
$ | 48,507 | $ | 8,959 | ||||
|
|
|
|
Year Ended December 31, |
||||||||
(In thousands, except per share amounts) |
2020 |
2019 |
||||||
NET REVENUES |
$ | 11,849 | $ | 1,687 | ||||
COST OF REVENUES |
8,134 | 1,167 | ||||||
|
|
|
|
|||||
GROSS PROFIT |
3,715 | 520 | ||||||
|
|
|
|
|||||
OPERATING EXPENSES: |
||||||||
Research and development |
13,049 | 11,136 | ||||||
Selling, general and administrative |
9,469 | 6,478 | ||||||
|
|
|
|
|||||
Total operating expenses |
22,518 | 17,614 | ||||||
|
|
|
|
|||||
LOSS FROM OPERATIONS |
(18,803 | ) | (17,094 | ) | ||||
INTEREST EXPENSE, net of interest income of $4 and $5 |
(236 | ) | (254 | ) | ||||
|
|
|
|
|||||
LOSS BEFORE INCOME TAXES |
(19,039 | ) | (17,348 | ) | ||||
PROVISION FOR INCOME TAXES |
5 | 1 | ||||||
|
|
|
|
|||||
NET LOSS |
$ | (19,044 | ) | $ | (17,349 | ) | ||
|
|
|
|
|||||
NET LOSS PER COMMON SHARE: |
||||||||
Basic and diluted |
$ | (1.28 | ) | $ | (1.20 | ) | ||
|
|
|
|
|||||
COMMON SHARES USED IN PER SHARE CALCULATION: |
||||||||
Basic and diluted |
14,847 | 14,516 | ||||||
|
|
|
|
Year Ended December 31, |
||||||||
(In thousands) |
2020 |
2019 |
||||||
Net loss |
$ | (19,044 | ) | $ | (17,349 | ) | ||
Other comprehensive income (loss), net of tax: |
||||||||
Foreign currency translation adjustments, net of tax |
(1 | ) | — | |||||
|
|
|
|
|||||
Total other comprehensive income (loss) |
(1 | ) | — | |||||
|
|
|
|
|||||
TOTAL COMPREHENSIVE LOSS |
$ | (19,045 | ) | $ | (17,349 | ) | ||
|
|
|
|
Redeemable Convertible Preferred Stock | Stockholder’s Equity (Deficit) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series A redeemable convertible preferred stock |
Series B redeemable convertible preferred stock |
Series B-1 redeemable convertible preferred stock |
Series B-2 redeemable convertible preferred stock |
Common stock | Additional paid in capital |
Accumulated deficit |
Accumulated comprehensive income (loss) |
Total | ||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) |
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2018 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 4,340 | $ | 11,976 | — | $ | — | 14,377 | $ | 1 | $ | 2,335 | $ | (39,589 | ) | $ | — | $ | (37,253 | ) | |||||||||||||||||||||||||||||||
Issuance of preferred stock |
— | — | — | — | 1,076 | 3,000 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Preferred stock issuance costs |
— | — | — | — | — | (190 | ) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Vesting of warrants |
— | — | — | — | — | — | — | — | — | — | 1 | — | — | 1 | ||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted common stock |
— | — | — | — | — | — | — | — | 278 | — | 31 | — | — | 31 | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense related to employee stock awards |
— | — | — | — | — | — | — | — | — | — | 116 | — | — | 116 | ||||||||||||||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | — | — | — | (17,349 | ) | — | (17,349 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2019 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | — | — | 14,655 | $ | 1 | $ | 2,483 | $ | (56,938 | ) | $ | — | $ | (54,454 | ) | ||||||||||||||||||||||||||||||||
Issuance of common stock under employee stock option and stock award plans |
— | — | — | — | — | — | — | — | 672 | 1 | 31 | — | — | 32 | ||||||||||||||||||||||||||||||||||||||||||
Issuance of preferred stock |
— | — | — | — | — | — | 18,199 | 53,085 | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Preferred stock issuance costs |
— | — | — | — | — | — | — | (706 | ) | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense related to employee and non-employee stock awards |
— | — | — | — | — | — | — | — | — | — | 1,027 | — | — | 1,027 | ||||||||||||||||||||||||||||||||||||||||||
Issuance of warrants |
— | — | — | — | — | — | — | — | — | — | 16 | — | — | 16 | ||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment |
— | — | — | — | — | — | — | — | — | — | — | — | (1 | ) | (1 | ) | ||||||||||||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | — | — | — | (19,044 | ) | — | (19,044 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2020 |
16,620 | $ | 14,970 | 14,213 | $ | 27,371 | 5,416 | $ | 14,786 | 18,199 | $ | 52,379 | 15,327 | $ | 2 | $ | 3,557 | $ | (75,982 | ) | $ | (1 | ) | $ | (72,424 | ) | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
||||||||
(In thousands) |
2020 |
2019 |
||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
Net loss |
$ | (19,044 | ) | $ | (17,349 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
Depreciation |
344 | 385 | ||||||
Amortization of intangibles |
167 | — | ||||||
Amortization of deferred rent |
20 | 46 | ||||||
Other |
38 | 1 | ||||||
Stock-based compensation expense |
1,027 | 116 | ||||||
Amortization of debt discount and issuance costs |
8 | 8 | ||||||
Change in operating assets and liabilities: |
||||||||
Accounts receivable |
(3,454 | ) | (480 | ) | ||||
Inventory |
(2,705 | ) | (197 | ) | ||||
Prepaid expenses and other current assets |
(286 | ) | 67 | |||||
Other assets |
(5 | ) | (69 | ) | ||||
Accounts payable, accrued compensation and other expenses |
3,553 | (422 | ) | |||||
Deferred revenue |
(288 | ) | 288 | |||||
|
|
|
|
|||||
Net cash used in operating activities |
(20,625 | ) | (17,606 | ) | ||||
|
|
|
|
|||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
Purchases of property and equipment |
(223 | ) | (66 | ) | ||||
Repayment (issuance) of notes receivable |
8 | (2 | ) | |||||
|
|
|
|
|||||
Net cash used in investing activities |
(215 | ) | (68 | ) | ||||
|
|
|
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
Proceeds from issuance of preferred stock |
53,085 | 3,000 | ||||||
Payment of preferred stock issuance costs |
(706 | ) | (190 | ) | ||||
Proceeds from issuance of common stock |
31 | — | ||||||
Proceeds from issuance of long-term debt |
6,000 | 2,000 | ||||||
Principal payments on long-term debt |
(4,800 | ) | (1,200 | ) | ||||
Payment of debt issuance costs |
(20 | ) | — | |||||
|
|
|
|
|||||
Net cash provided by financing activities |
53,590 | 3,610 | ||||||
|
|
|
|
|||||
Effect of exchange rate changes on cash |
1 | — | ||||||
|
|
|
|
|||||
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH |
32,751 | (14,064 | ) | |||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD |
6,118 | 20,182 | ||||||
|
|
|
|
|||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD |
$ | 38,869 | $ | 6,118 | ||||
|
|
|
|
|||||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: |
||||||||
Payable for asset acquisition |
$ | 683 | $ | — | ||||
Warrants issued in connection with debt |
$ | 16 | $ | — | ||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
||||||||
Cash paid for income taxes |
$ | 2 | $ | 1 | ||||
Cash paid for interest |
$ | 218 | $ | 289 |
2020 |
2019 |
2018 |
||||||||||
Cash and cash equivalents |
$ | 38,869 | $ | 5,970 | $ | 20,035 | ||||||
Restricted cash |
— | 148 | 147 | |||||||||
|
|
|
|
|
|
|||||||
Total cash, cash equivalents and restricted cash |
$ | 38,869 | $ | 6,118 | $ | 20,182 | ||||||
|
|
|
|
|
|
2020 |
2019 |
|||||||
Furniture and fixtures |
$ | 164 | $ | 168 | ||||
Computers and other equipment |
1,591 | 1,558 | ||||||
Leasehold improvements |
135 | 135 | ||||||
|
|
|
|
|||||
1,890 | 1,861 | |||||||
Accumulated depreciation |
(1,168 | ) | (979 | ) | ||||
|
|
|
|
|||||
Total |
$ | 722 | $ | 882 | ||||
|
|
|
|
Furniture and fixtures |
3 — 7 years | |||
Computers and other equipment |
2 — 5 years | |||
Leasehold improvements |
2 — 5 years |
December 31, 2020 |
December 31, 2019 |
|||||||
Raw materials |
$ | 1,042 | $ | 276 | ||||
Work-in-process |
1,991 | 75 | ||||||
Finished goods |
371 | 348 | ||||||
|
|
|
|
|||||
Total |
$ | 3,404 | $ | 699 | ||||
|
|
|
|
2020 | 2019 | |||||||
Note payable |
$ | 6,000 | $ | 4,800 | ||||
Less: Current portion |
(1,000 | ) | (2,400 | ) | ||||
Less: Debt discount and issuance costs |
(29 | ) | — | |||||
|
|
|
|
|||||
Note payable, net of current portion |
$ | 4,971 | $ | 2,400 | ||||
|
|
|
|
Fiscal Year |
||||
2021 |
$ | 1,000 | ||
2022 |
2,400 | |||
2023 |
2,400 | |||
2024 |
200 | |||
2025 |
— | |||
Thereafter |
— | |||
|
|
|||
Total |
$ | 6,000 | ||
|
|
Year Ended December 31, |
||||||||
2020 |
2019 |
|||||||
Risk-free interest rates |
0.42 | % | 2.66 | % | ||||
Expected volatility rates |
44 | % | 39 | % | ||||
Expected dividend yield |
— | — | ||||||
Expected term (in years) |
6 | 6 | ||||||
Weighted-average grant date fair value of options |
$ | 0.48 | $ | 0.08 |
Shares (In thousands) |
Weighted- Average Exercise Price |
Weighted- Average Remaining Contractual Term (In years) |
||||||||||
Outstanding at December 31, 2018 |
7,954 | $ | 0.13 | 8.7 | ||||||||
Granted |
1,120 | 0.22 | ||||||||||
Exercised |
— | — | ||||||||||
Forfeited or expired |
— | — | ||||||||||
|
|
|
|
|||||||||
Outstanding at December 31, 2019 |
9,075 | $ | 0.19 | 7.9 | ||||||||
Granted |
3,983 | 1.16 | ||||||||||
Exercised |
(187 | ) | 0.14 | |||||||||
Forfeited or expired |
(1,011 | ) | 0.19 | |||||||||
|
|
|
|
|||||||||
Outstanding at December 31, 2020 |
11,860 | $ | 0.51 | 7.8 | ||||||||
|
|
|
|
|||||||||
Vested and Exercisable at December 31, 2020 |
5,925 | $ | 0.20 | 6.9 | ||||||||
|
|
|
|
Shares (In thousands) |
Weighted Average Fair Value |
|||||||
Unvested options outstanding at December 31, 2018 |
5,019 | $ | 0.08 | |||||
Granted |
1,120 | 0.08 | ||||||
Vested |
(1,045 | ) | 0.06 | |||||
Forfeited or expired |
— | — | ||||||
|
|
|||||||
Unvested options outstanding at December 31, 2019 |
5,094 | 0.08 | ||||||
Granted |
3,983 | 0.48 | ||||||
Vested |
(2,132 | ) | 0.11 | |||||
Forfeited or expired |
(1,010 | ) | 0.08 | |||||
|
|
|||||||
Unvested options outstanding at December 31, 2020 |
5,935 | $ | 0.33 | |||||
|
|
Shares (In thousands) |
Weighted-Average Issuance Price |
Weighted-Average Grant Date Fair Value Per Share |
||||||||||
Outstanding at December 31, 2018 |
252 | $ | 0.12 | $ | 0.01 | |||||||
Granted |
26 | 0.22 | 0.01 | |||||||||
Vested |
(278 | ) | 0.03 | 0.01 | ||||||||
Forfeited |
— | — | — | |||||||||
|
|
|||||||||||
Outstanding at December 31, 2019 |
— | $ | — | $ | — | |||||||
|
|
Year Ended December 31, |
||||||||
Customer |
2020 |
2019 |
||||||
Distributor A |
31 | % | 28 | % | ||||
Distributor B |
21 | * | ||||||
Distributor C |
16 | 29 | ||||||
Distributor D |
13 | * | ||||||
Distributor E |
18 | 28 |
* | Total customer revenue was less than 10% of net revenues. |
Year ended December 31, |
||||||||
Country |
2020 |
2019 |
||||||
China |
86 | % | 85 | % | ||||
United States |
7 | 9 | ||||||
Taiwan |
3 | — | ||||||
Korea |
2 | — | ||||||
All others |
2 | 6 | ||||||
|
|
|
|
|||||
Total |
100 | % | 100 | % | ||||
|
|
|
|
As of December 31, |
||||||||
Customer |
2020 |
2019 |
||||||
Distributor A |
* | % | 34 | % | ||||
Distributor B |
55 | * | ||||||
Distributor C |
* | 32 | ||||||
Distributor D |
17 | * | ||||||
Distributor E |
17 | 34 |
* | Total customer accounts receivable was less than 10% of net accounts receivables. |
2020 | 2019 | |||||||
Expected dividend yield |
— | — | ||||||
Risk-free interest rate |
0.21 | % | 2.67 | % | ||||
Expected life in years |
2.5 | 5 | ||||||
Expected volatility |
68 | % | 41 | % | ||||
Weighted-average fair value of warrants granted |
$ | 0.85 | $ | 0.23 |
Year Ended December 31, |
||||||||
(In thousands, except per share amounts) |
2020 |
2019 |
||||||
Basic and diluted loss per common share: (1) |
||||||||
Net loss |
$ | (19,044 | ) | $ | (17,349 | ) | ||
|
|
|
|
|||||
Weighted-average common shares |
14,847 | 14,516 | ||||||
|
|
|
|
|||||
Basic and diluted loss per common share |
$ | (1.28 | ) | $ | (1.20 | ) | ||
|
|
|
|
(1) | The Company’s potentially dilutive securities, which include unexercised stock options, unvested shares, preferred shares and warrants for common and preferred shares, have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common shareholders is the same. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common shareholders for the periods indicated because including them would have had an antidilutive effect: |
Year Ended December 31, |
||||||||
(In thousands) |
2020 |
2019 |
||||||
Redeemable convertible preferred stock shares |
54,449 | 36,250 | ||||||
Warrants to purchase redeemable convertible preferred stock |
176 | 501 | ||||||
Warrants to purchase common shares |
1,107 | 932 | ||||||
Stock options potentially exercisable for common shares |
11,860 | 9,075 | ||||||
|
|
|
|
|||||
67,592 | 46,758 | |||||||
|
|
|
|
Year Ended December 31, |
||||||||
2020 |
2019 |
|||||||
U.S. operations |
$ | (14,084 | ) | $ | (17,348 | ) | ||
Foreign operations |
(4,955 | ) | — | |||||
|
|
|
|
|||||
Total loss before income taxes |
$ | (19,039 | ) | $ | (17,348 | ) | ||
|
|
|
|
Year Ended December 31, |
||||||||
2020 |
2019 |
|||||||
Current provision (benefit): |
||||||||
Federal |
$ | — | $ | — | ||||
State |
1 | 1 | ||||||
Foreign |
4 | — | ||||||
|
|
|
|
|||||
5 | 1 | |||||||
|
|
|
|
|||||
Deferred provision (benefit): |
||||||||
Federal |
(4,216 | ) | (3,607 | ) | ||||
State |
2,285 | (1,207 | ) | |||||
Foreign |
(1,237 | ) | — | |||||
Valuation allowance |
3,168 | 4,814 | ||||||
|
|
|
|
|||||
— | — | |||||||
|
|
|
|
|||||
Total |
$ | 5 | $ | 1 | ||||
|
|
|
|
Year Ended December 31, |
||||||||
2020 |
2019 |
|||||||
Provision computed at Federal statutory rate |
21.0 | % | 21.0 | % | ||||
Change in valuation allowance |
(17.2 | ) | (27.8 | ) | ||||
Return to provision adjustments |
(6.7 | ) | (0.0 | ) | ||||
Foreign income tax rate and benefit |
6.7 | — | ||||||
Effect of permanent differences |
(0.7 | ) | (0.2 | ) | ||||
State tax, net of federal |
0.2 | 7.0 | ||||||
Deferred tax asset and liability adjustment |
(3.2 | ) | — | |||||
Other |
(0.1 | ) | — | |||||
|
|
|
|
|||||
Total |
0.0 | % | 0.0 | % | ||||
|
|
|
|
December 31, |
||||||||
2020 |
2019 |
|||||||
Deferred tax assets: |
||||||||
Net operating loss carryforwards |
$ | 17,146 | $ | 13,601 | ||||
Benefit of tax credit carry-forwards |
207 | 208 | ||||||
Start up costs |
1,648 | 2,361 | ||||||
Other |
410 | 103 | ||||||
Valuation allowance |
(19,392 | ) | (16,224 | ) | ||||
|
|
|
|
|||||
19 | 49 | |||||||
Deferred tax liabilities: |
||||||||
Depreciation |
(19 | ) | (49 | ) | ||||
|
|
|
|
|||||
(19 | ) | (49 | ) | |||||
|
|
|
|
|||||
Net deferred tax balance |
$ | — | $ | — | ||||
|
|
|
|
December 31, 2020 |
||||
2021 |
$ | 848 | ||
2022 |
532 | |||
2023 |
142 | |||
2024 |
— | |||
2025 |
— | |||
Thereafter |
— | |||
|
|
|||
Total future minimum lease payments |
$ | 1,522 | ||
|
|
December 31, 2020 |
December 31, 2019 |
|||||||
Notes receivable |
$ | 221 | $ | 229 |
Page | ||||||
ARTICLE I DEFINITIONS |
A-2 | |||||
1.01 |
Certain Definitions | A-2 | ||||
1.02 |
Further Definitions | A-16 | ||||
1.03 |
Construction | A-18 | ||||
ARTICLE II THE TENDER OFFER |
A-19 | |||||
2.01 |
Tender Offer | A-19 | ||||
ARTICLE III AGREEMENT AND PLAN OF MERGER |
A-21 | |||||
3.01 |
The Merger | A-21 | ||||
3.02 |
Effective Time; Closing | A-21 | ||||
3.03 |
Effect of the Merger | A-22 | ||||
3.04 |
Organizational Documents; Registration Rights Agreement | A-22 | ||||
3.05 |
Directors and Officers | A-22 | ||||
ARTICLE IV EFFECTS OF THE TRANSACTIONS |
A-23 | |||||
4.01 |
Conversion and Treatment of Securities | A-23 | ||||
4.02 |
Exchange of Certificates | A-25 | ||||
4.03 |
Earnout | A-27 | ||||
4.04 |
Payment of LOKB Transaction Costs; Closing Statements | A-29 | ||||
4.05 |
Share Transfer Books | A-30 | ||||
ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE COMPANY |
A-30 | |||||
5.01 |
Organization and Qualification; Subsidiaries | A-31 | ||||
5.02 |
Organizational Documents | A-31 | ||||
5.03 |
Capitalization | A-31 | ||||
5.04 |
Authority Relative to this Agreement | A-33 | ||||
5.05 |
No Conflict; Required Filings and Consents | A-33 | ||||
5.06 |
Permits; Compliance | A-34 | ||||
5.07 |
Financial Statements | A-34 | ||||
5.08 |
Absence of Certain Changes or Events | A-36 | ||||
5.09 |
Absence of Litigation | A-36 | ||||
5.10 |
Employee Benefit Plans | A-36 | ||||
5.11 |
Labor and Employment Matters | A-39 | ||||
5.12 |
Real Property; Title to Assets | A-40 | ||||
5.13 |
Intellectual Property | A-41 | ||||
5.14 |
Taxes | A-43 | ||||
5.15 |
Environmental Matters | A-47 | ||||
5.16 |
Material Contracts | A-47 | ||||
5.17 |
Customers, Vendors and Suppliers | A-49 | ||||
5.18 |
Insurance | A-49 | ||||
5.19 |
Board Approval; Vote Required | A-49 | ||||
5.20 |
Certain Business Practices | A-50 | ||||
5.21 |
Interested Party Transactions. | A-51 | ||||
5.22 |
Exchange Act; Sarbanes-Oxley | A-52 | ||||
5.23 |
Brokers | A-52 | ||||
5.24 |
Product Warranty; Product Liability | A-52 | ||||
5.25 |
Exclusivity of Representations and Warranties | A-52 |
Page | ||||||
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF LOKB AND MERGER SUB |
A-53 | |||||
6.01 |
Corporate Organization | A-53 | ||||
6.02 |
Organizational Documents | A-53 | ||||
6.03 |
Capitalization | A-53 | ||||
6.04 |
Authority Relative to This Agreement | A-54 | ||||
6.05 |
No Conflict; Required Filings and Consents | A-55 | ||||
6.06 |
Compliance | A-55 | ||||
6.07 |
SEC Filings; Financial Statements; Sarbanes-Oxley | A-55 | ||||
6.08 |
Business Activities | A-57 | ||||
6.09 |
Absence of Certain Changes or Events | A-58 | ||||
6.10 |
Absence of Litigation | A-58 | ||||
6.11 |
Board Approval; Vote Required | A-58 | ||||
6.12 |
No Prior Operations of Merger Sub | A-58 | ||||
6.13 |
Brokers | A-58 | ||||
6.14 |
LOKB Trust Fund | A-59 | ||||
6.15 |
Employees | A-59 | ||||
6.16 |
Taxes | A-59 | ||||
6.17 |
Registration and Listing | A-61 | ||||
6.18 |
LOKB’s and Merger Sub’s Investigation and Reliance | A-61 | ||||
6.19 |
Private Placements | A-62 | ||||
6.20 |
Related Party Transactions | A-62 | ||||
6.21 |
Investment Company Act | A-62 | ||||
ARTICLE VII CONDUCT OF BUSINESS PENDING THE MERGER |
A-62 | |||||
7.01 |
Conduct of Business by the Company Pending the Merger | A-62 | ||||
7.02 |
Conduct of Business by LOKB and Merger Sub Pending the Merger | A-66 | ||||
7.03 |
Claims Against Trust Account | A-68 | ||||
ARTICLE VIII ADDITIONAL AGREEMENTS |
A-68 | |||||
8.01 |
No Solicitation | A-68 | ||||
8.02 |
Registration Statement; Consent Solicitation; Proxy Statement | A-70 | ||||
8.03 |
Consent Solicitation; Written Consent; Company Change in Recommendation | A-71 | ||||
8.04 |
LOKB Stockholders’ Meeting; and Merger Sub Stockholder’s Approval | A-73 | ||||
8.05 |
Access to Information; Confidentiality | A-73 | ||||
8.06 |
Employee Benefits Matters | A-74 | ||||
8.07 |
Directors’ and Officers’ Indemnification | A-75 | ||||
8.08 |
Notification of Certain Matters | A-76 | ||||
8.09 |
Further Action; Reasonable Best Efforts | A-76 | ||||
8.10 |
Public Announcements | A-77 | ||||
8.11 |
Stock Exchange Listing | A-77 | ||||
8.12 |
Antitrust | A-77 | ||||
8.13 |
Trust Account | A-78 | ||||
8.14 |
Tax Matters | A-79 | ||||
8.15 |
LOKB Directors | A-79 | ||||
8.16 |
Audited Financial Statements | A-79 | ||||
8.17 |
Termination of Interested Party Transactions | A-79 | ||||
8.18 |
Valuation Analysis | A-79 | ||||
8.19 |
Company Warrants | A-80 | ||||
8.20 |
Private Placements | A-80 |
Page | ||||||
ARTICLE IX CONDITIONS TO THE MERGER |
A-81 | |||||
9.01 |
Conditions to the Obligations of Each Party | A-81 | ||||
9.02 |
Conditions to the Obligations of LOKB and Merger Sub | A-81 | ||||
9.03 |
Conditions to the Obligations of the Company | A-83 | ||||
ARTICLE X TERMINATION, AMENDMENT AND WAIVER |
A-84 | |||||
10.01 |
Termination | A-84 | ||||
10.02 |
Effect of Termination | A-85 | ||||
10.03 |
Expenses | A-85 | ||||
10.04 |
Amendment | A-85 | ||||
10.05 |
Waiver | A-85 | ||||
ARTICLE XI GENERAL PROVISIONS |
A-85 | |||||
11.01 |
Notices | A-85 | ||||
11.02 |
Nonsurvival of Representations, Warranties and Covenants | A-86 | ||||
11.03 |
Severability | A-86 | ||||
11.04 |
Entire Agreement; Assignment | A-86 | ||||
11.05 |
Parties in Interest | A-86 | ||||
11.06 |
Governing Law | A-86 | ||||
11.07 |
Waiver of Jury Trial | A-87 | ||||
11.08 |
Headings | A-87 | ||||
11.09 |
Counterparts | A-87 | ||||
11.10 |
Specific Performance | A-88 | ||||
11.11 |
No Recourse | A-88 |
Exhibit A | Shareholder Support Agreement | |
Exhibit B | Form of Amended and Restated Registration Rights Agreement | |
Exhibit C | Form of Sponsor Letter Amendment | |
Exhibit D | Form of Amended and Restated Organizational Documents of Navitas Ireland | |
Exhibit E | Form of Amended and Restated Limited Liability Company Agreement of Navitas Delaware | |
Exhibit F | Form of Second Amended and Restated Certificate of Incorporation of LOKB | |
Exhibit G | Form of Amended and Restated Bylaws of LOKB | |
Exhibit H | Officers of Navitas Delaware and Directors and Officers of LOKB Following the Merger | |
Exhibit I | Form of Written Consent in Lieu of Special Meeting of Company Shareholders | |
Exhibit J | Form of LTIP | |
Schedule A | Knowledge Parties | |
Schedule B | Key Company Shareholders | |
Schedule C | Minority Investors |
Defined Term |
Location of Definition | |
2020 Balance Sheet | § 5.07(b) | |
Acceptance Time | § 2.01(d) | |
Action | § 5.09 | |
Agreement | Preamble | |
Alternative Transaction | § 8.01(a) | |
Antitrust Laws | § 8.12(a) | |
Audited Financial Statements | § 5.07(a) | |
Blue Sky Laws | § 5.05(b) | |
Call Notice | § 2.01(e)(ii) | |
Certificate of Merger | § 3.02(a) | |
Certificates | § 4.02(b) | |
Claims | § 7.03 | |
Closing | § 3.02(b) | |
Closing Date | § 3.02(b) | |
Code | § 4.02(h) | |
Companies Act | Recitals | |
Company | Preamble | |
Company Board | Recitals | |
Company Change in Recommendation | § 8.03(b) | |
Company Closing Statement | § 4.04(c) | |
Company Disclosure Schedule | Article V | |
Company Permits | § 5.06 | |
Company Recommendation | Recitals | |
Company Warrants | § 5.03(b) | |
Confidentiality Agreement | § 8.05(b) | |
Consent Solicitation Statement | § 8.02(a) | |
Continuing Employees | § 8.06(c) | |
Contracting Parties | § 11.11 | |
D&O Insurance | § 8.07(c) | |
Data Security Requirements | § 5.13(j) | |
Dissenting Shareholders | § 2.01(e)(ii) | |
DGCL | Recitals | |
DLLCA | Recitals | |
Earnout Shares | § 4.03(a) | |
Effective Time | § 3.02(a) | |
Employee Contributions | § 5.10(r) | |
Employer Contributions | § 5.10(r) |
Defined Term |
Location of Definition | |
Environmental Permits | § 5.15 | |
ERISA Affiliate | § 5.10(c) | |
Exchange Agent | § 4.02(a) | |
Exchange Fund | § 4.02(a) | |
Financial Statement Delivery Date | § 10.01(b) | |
Forfeited Employee Earnout Shares | § 4.03(d) | |
Forfeited Warrant Earnout Shares | § 4.03(e) | |
GAAP | § 5.07(a) | |
Governmental Authority | § 5.05(b) | |
Health Plan | § 5.10(k) | |
Interested Party Transaction | § 5.21(a) | |
IRS | § 5.12(b) | |
Lease | § 5.12(b) | |
Lease Documents | § 5.12(a) | |
Letter Agreement | Recitals | |
Letter of Transmittal | § 4.02(b) | |
LOKB | Preamble | |
LOKB Alternative Transaction | § 8.01(d) | |
LOKB Assumed Warrant | § 4.01(d) | |
LOKB Board | Recitals | |
LOKB Closing Statement | § 4.04(b) | |
LOKB D&O Insurance | § 8.07(d) | |
LOKB Disclosure Schedule | Article VI | |
LOKB Option | § 4.01(b) | |
LOKB Permit | § 6.06 | |
LOKB Preferred Stock | § 6.03(a) | |
LOKB Proposals | § 8.04(a) | |
LOKB Restricted Stock | § 4.01(c) | |
LOKB Restricted Stock Units | § 4.01(d) | |
LOKB SEC Reports | § 6.07(a) | |
LOKB Stockholders’ Meeting | § 8.04(a) | |
LOKB Tail Policy | § 8.07(d) | |
LTIP | § 8.06(a) | |
Material Contracts | § 5.16(a) | |
Material Customer Prospects | § 5.17 | |
Material Customers | § 5.17 | |
Material Suppliers | § 5.17 | |
Maximum Annual Premium | § 8.07(c) | |
Maximum Merger Earnout Shares | § 4.03(b) | |
Maximum Number of Earnout Shares | § 4.03(b) | |
Maximum Tender Offer Earnout Shares | § 4.03(b) | |
Merger | Recitals | |
Merger Materials | § 8.02(d) | |
Merger Sub | Preamble | |
Merger Sub Board | Recitals | |
Merger Sub Common Stock | § 6.03(b) | |
Money Laundering Laws | § 5.20(b) | |
Navitas Delaware | Preamble | |
Navitas Delaware Percentage | § 8.18 | |
Navitas Delaware Warrants | § 5.03(b) | |
Navitas Ireland | Preamble |
Defined Term |
Location of Definition | |
Navitas Ireland Percentage | § 8.18 | |
Navitas Ireland Warrants | § 5.03(b) | |
Navitas Lock-Up Agreements |
Recitals | |
Nonparty Affiliates | § 11.11 | |
Offer Expiration Time | § 2.01(c) | |
Offer Conditions | § 2.01(b) | |
Outside Date | § 10.01(b) | |
PCAOB Audited Financial Statements | § 8.16 | |
Per Share Merger Consideration | § 4.01(a)(i) | |
Per Share Tender Offer Consideration | § 2.01(d) | |
Permitted Warrant Amendment | § 8.19 | |
Plans | § 5.10(a) | |
PPACA | § 5.10(k) | |
Private Placement Investors | Recitals | |
Private Placements | Recitals | |
Process Agent | § 11.06(d) | |
Proxy Statement | § 8.02(a) | |
PRSA | § 5.10(q) | |
Registration Rights Agreement | Recitals | |
Registration Statement | § 8.02(a) | |
Relief Application | § 2.01(e)(iv) | |
Remedies Exceptions | § 5.04 | |
Representatives | § 8.05(a) | |
Requisite Company Shareholder Approval | § 8.03(a) | |
SEC | § 6.07(a) | |
Securities Act | § 5.05(b) | |
Shareholder Support Agreement | Recitals | |
Side Letter Agreements | § 5.21(b) | |
Specified IP | § 5.14(y) | |
Sponsor | Recitals | |
Sponsor Letter Amendment | Recitals | |
Subject Options | § 5.10(o) | |
Subscription Agreements | Recitals | |
Surviving Company | § 3.01 | |
Tender Offer | Recitals | |
Tender Offer Materials | § 8.03(b) | |
Terminating Company Breach | § 10.01(e) | |
Terminating LOKB Breach | § 10.01(f) | |
Trust Account | § 6.14 | |
Trust Agreement | § 6.14 | |
Trust Fund | § 6.14 | |
Trustee | § 6.14 | |
Unaudited Financial Statements | § 5.07(b) | |
Valuation Firm | § 8.18 | |
Valuation Analysis | § 8.18 | |
Written Consent | § 8.03(a) |
5.16 |
Material Contracts . |
5.18 |
Insurance . |
5.21 |
Interested Party Transactions. |
5.22 |
Exchange Act ; Sarbanes-Oxley (a) . |
5.24 |
Product Warranty; Product Liability . |
6.05 |
No Conflict; Required Filings and Consents . |
6.07 |
SEC Filings; Financial Statements; Sarbanes-Oxley . |
6.08 |
Business Activities . |
LIVE OAK ACQUISITION CORP. II | ||
By: | /s/ Gary Wunderlich | |
Name: | Gary Wunderlich | |
Title: | President | |
LIVE OAK MERGER SUB INC. | ||
By: | /s/ Gary Wunderlich | |
Name: | Gary Wunderlich | |
Title: | President | |
NAVITAS SEMICONDUCTOR LIMITED, including as domesticated in the State of Delaware as Navitas Semiconductor Ireland, LLC | ||
By: | /s/ Gene Sheridan | |
Name: | Gene Sheridan | |
Title: | CEO |
NAVITAS SEMICONDUCTOR CORPORATION | ||
By: | | |
Name: | ||
Title: | ||
HOLDERS: | ||
Live Oak Sponsor Partners II, LLC | ||
By: | | |
Name: | ||
Title: | ||
[●] | ||
By: | | |
Name: | ||
Title: |
• | the numerator shall be equal to the sum of (A) 25% of all shares of Class A Common Stock issued or issuable (upon the conversion or exercise of any Equity-linked Securities or otherwise) by the Corporation, related to or in connection with the consummation of the initial Business Combination (excluding any securities issued or issuable to any seller in the initial Business Combination and any private placement or working capital securities issued to affiliates of the Corporation) plus (B) the number of shares of Class B Common Stock issued and outstanding prior to the closing of the initial Business Combination; and |
• | the denominator shall be the number of shares of Class B Common Stock issued and outstanding prior to the closing of the initial Business Combination. |
Navitas Semiconductor Corporation | ||
By: | | |
Name: | [●] | |
Title: | [●] |
Page |
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1. Establishment, Purpose and term of Plan |
C-5 | |||||
1.1 |
Establishment | C-5 | ||||
1.2 |
Purpose | C-5 | ||||
1.3 |
Term of Plan | C-5 | ||||
2. Definitions and Construction |
C-5 | |||||
2.1 |
Definitions | C-5 | ||||
2.2 |
Construction | C-11 |
||||
3. Administration |
C-11 | |||||
3.1 |
Administration by the Committee | C-11 | ||||
3.2 |
Authority of Officers | C-11 | ||||
3.3 |
Administration with Respect to Insiders | C-11 | ||||
3.4 |
Powers of the Committee | C-11 | ||||
3.5 |
Option or SAR Repricing | C-12 | ||||
3.6 |
Indemnification | C-12 | ||||
4. Shares Subject to Plan |
C-13 | |||||
4.1 |
Maximum Number of Shares Issuable | C-13 | ||||
4.2 |
Share Counting | C-13 | ||||
4.3 |
Adjustments for Changes in Capital Structure | C-13 | ||||
4.4 |
Assumption or Substitution of Awards | C-14 | ||||
5. Eligibility, Participation and Award Limitations |
C-14 | |||||
5.1 |
Persons Eligible for Awards | C-14 | ||||
5.2 |
Participation in the Plan | C-14 | ||||
5.3 |
Incentive Stock Option Limitations | C-14 | ||||
5.4 |
Nonemployee Director Award Limit | C-15 | ||||
6. Stock Options |
C-15 | |||||
6.1 |
Exercise Price | C-15 | ||||
6.2 |
Exercisability and Term of Options | C-15 | ||||
6.3 |
Payment of Exercise Price | C-16 | ||||
6.4 |
Effect of Termination of Service | C-17 | ||||
6.5 |
Transferability of Options | C-16 | ||||
7. Stock Appreciation Rights |
C-17 | |||||
7.1 |
Types of SARs Authorized | C-17 | ||||
7.2 |
Exercise Price | C-18 | ||||
7.3 |
Exercisability and Term of SARs | C-18 | ||||
7.4 |
Exercise of SARs | C-18 | ||||
7.5 |
Deemed Exercise of SARs | C-18 | ||||
7.6 |
Effect of Termination of Service | C-19 | ||||
7.7 |
Transferability of SARs | C-19 | ||||
8. Restricted Stock Awards |
C-19 | |||||
8.1 |
Types of Restricted Stock Awards Authorized | C-19 | ||||
8.2 |
Purchase Price | C-19 | ||||
8.3 |
Purchase Period | C-19 |
Page |
||||||
8.4 |
Payment of Purchase Price | C-19 |
||||
8.5 |
Vesting and Restrictions on Transfer | C-19 | ||||
8.6 |
Voting Rights; Dividends and Distributions | C-20 | ||||
8.7 |
Effect of Termination of Service | C-20 | ||||
8.8 |
Nontransferability of Restricted Stock Award Rights | C-20 | ||||
9. Restricted Stock Units |
C-20 | |||||
9.1 |
Grant of Restricted Stock Unit Awards | C-21 | ||||
9.2 |
Purchase Price | C-21 | ||||
9.3 |
Vesting | C-21 | ||||
9.4 |
Voting Rights, Dividend Equivalent Rights and Distributions | C-21 | ||||
9.5 |
Effect of Termination of Service | C-21 | ||||
9.6 |
Settlement of Restricted Stock Unit Awards | C-22 | ||||
9.7 |
Nontransferability of Restricted Stock Unit Awards | C-22 | ||||
10. Performance Awards |
C-22 | |||||
10.1 |
Types of Performance Awards Authorized | C-22 | ||||
10.2 |
Initial Value of Performance Shares and Performance Units | C-22 | ||||
10.3 |
Establishment of Performance Period, Performance Goals and Performance Award Formula | C-22 | ||||
10.4 |
Measurement of Performance Goals | C-23 | ||||
10.5 |
Settlement of Performance Awards | C-25 | ||||
10.6 |
Voting Rights; Dividend Equivalent Rights and Distributions | C-25 | ||||
10.7 |
Effect of Termination of Service | C-26 | ||||
10.8 |
Nontransferability of Performance Awards | C-26 | ||||
11. Cash-Based Awards and Other Stock-Based Awards |
C-26 | |||||
11.1 |
Grant of Cash-Based Awards | C-26 | ||||
11.2 |
Grant of Other Stock-Based Awards | C-26 | ||||
11.3 |
Value of Cash-Based and Other Stock-Based Awards | C-27 | ||||
11.4 |
Payment or Settlement of Cash-Based Awards and Other Stock-Based Awards | C-27 | ||||
11.5 |
Voting Rights; Dividend Equivalent Rights and Distributions | C-27 | ||||
11.6 |
Effect of Termination of Service | C-27 | ||||
11.7 |
Nontransferability of Cash-Based Awards and Other Stock-Based Awards | C-27 | ||||
12. Standard Forms of Award Agreement |
C-28 | |||||
12.1 |
Award Agreements | C-28 | ||||
12.2 |
Authority to Vary Terms | C-28 | ||||
13. Change in Control |
C-28 | |||||
13.1 |
Effect of Change in Control on Awards | C-28 | ||||
13.2 |
Effect of Change in Control on Nonemployee Director Awards | C-29 | ||||
13.3 |
Federal Excise Tax Under Section 4999 of the Code | C-29 | ||||
14. Compliance with Securities Law |
C-30 | |||||
15. Compliance with Section 409A |
C-30 | |||||
15.1 |
Awards Subject to Section 409A | C-30 | ||||
15.2 |
Deferral and/or Distribution Elections | C-30 |
Page |
||||||
15.3 |
Subsequent Elections | C-31 |
||||
15.4 |
Payment of Section 409A Deferred Compensation | C-31 | ||||
16. Tax Withholding |
C-33 | |||||
16.1 |
Tax Withholding in General | C-33 | ||||
16.2 |
Withholding in or Directed Sale of Shares | C-33 | ||||
17. Amendment, Suspension or Termination of Plan |
C-33 | |||||
18. Miscellaneous Provisions |
C-33 | |||||
18.1 |
Repurchase Rights | C-33 | ||||
18.2 |
Forfeiture Events | C-34 | ||||
18.3 |
Provision of Information | C-34 | ||||
18.4 |
Rights as Employee, Consultant or Director | C-34 | ||||
18.5 |
Rights as a Stockholder | C-34 | ||||
18.6 |
Delivery of Title to Shares | C-34 | ||||
18.7 |
Fractional Shares | C-34 | ||||
18.8 |
Retirement and Welfare Plans | C-35 | ||||
18.9 |
Beneficiary Designation | C-35 | ||||
18.10 |
Severability | C-35 | ||||
18.11 |
No Constraint on Corporate Action | C-35 | ||||
18.12 |
Unfunded Obligation | C-35 | ||||
18.13 |
Choice of Law | C-35 |
2 |
NTD: 10% of the outstanding capitalization of Live Oak Acquisition Corp. II, Inc. immediately following the closing of the merger with Navitas Semiconductor Ireland, LLC. |
3 |
NTD: [ ]% of the outstanding capitalization of Live Oak Acquisition Corp. II, Inc. immediately following the closing of the combination with Navitas Semiconductor Ireland, LLC. |
|
The undersigned hereby appoints Richard J. Hendrix and Gary K. Wunderlich, Jr. (the “Proxies”), and each of them independently, with full power of substitution, as proxies and attorneys-in-fact shares of Class A Common Stock or Class B Common Stock of Live Oak Acquisition Corp. II (the “Company” or “LOKB”) that the undersigned is entitled to vote (the “Shares”) at the special meeting of stockholders of the Company to be held on , 2021 at Eastern Time via live webcast at https:/ /www.cstproxy.com/liveoakacqii/2021 be voted as indicated with respect to the proposals listed on the reverse side hereof and, unless such authority is withheld on the reverse side hereof, in the Proxies’ discretion on such other matters as may properly come before the special meeting or any adjournment or postponement thereof. | |
The undersigned acknowledges receipt of the enclosed proxy statement and revokes all prior proxies for said special meeting. | ||
THE SHARES REPRESENTED BY THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER(S). IF NO SPECIFIC DIRECTION IS GIVEN AS TO THE PROPOSALS ON THE REVERSE SIDE, THIS PROXY WILL BE VOTED “FOR” PROPOSAL NOS. 1, 2, 3, 4, 5 AND 7, “FOR ALL NOMINEES” ON PROPOSAL NO. 6 AND IN ACCORDANCE WITH THE JUDGMENT OF THE PROXIES ON ANY OTHER MATTERS AS MAY PROPERLY COME BEFORE THE SPECIAL MEETING. PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY. |
Please mark vote as indicated in this example |
☒ |
LIVE OAK ACQUISITION CORP. II — THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” PROPOSAL NOS. 1, 2, 3, 4, 5 AND 7 AND “FOR ALL NOMINEES” ON PROPOSAL NO. 6. |
(1) The Business Combination Proposal |
FOR ☐ |
AGAINST ☐ |
ABSTAIN ☐ |
(5) The 2021 Plan Proposal (6) The Director Election Proposal Nominees: 01 Gene Sheridan 02 Daniel Kinzer 03 Brian Long 04 Dipender Saluja |
FOR ☐ FOR ALL NOMINEES ☐ |
AGAINST ☐ WITHHOLD VOTE FOR ALL NOMINEES ☐ |
ABSTAIN ☐ FOR ALL NOMINEES EXCEPT* ☐ | |||||||
|
|
|
* Instruction: To withhold authority to vote for any individual nominee, mark “FOR ALL NOMINEES EXCEPT” and write the number of the nominee(s) on the line below: | |||||||||||
|
|
|
|
05 David Moxam 06 Richard J. Hendrix 07 Gary K. Wunderlich, Jr. |
| |||||||||
(2) The Authorized Share Charter Proposal |
FOR ☐ |
AGAINST ☐ |
ABSTAIN ☐ |
(7) The Adjournment Proposal |
FOR ☐ |
AGAINST ☐ |
ABSTAIN ☐ |
(3) The Additional Charter Proposal |
FOR ☐ |
AGAINST ☐ |
ABSTAIN ☐ |
|
|
|
|
(4) The PIPE Proposal |
FOR ☐ |
AGAINST ☐ |
ABSTAIN ☐ |
|
|
|
|
(a) |
Exhibits: |
* | Previously filed. |
† | Management Contracts. |
(1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: |
(i) | To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; |
(ii) | To reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and |
(iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; |
(2) | That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
(4) | That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. |
(5) | That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
(i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
(ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
(iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
(iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
(6) | That, prior to any public reoffering of the securities registered hereunder through use of a prospectus which is a part of this Registration Statement, by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c), the Registrant undertakes that such reoffering prospectus will contain the information called for by the applicable registration form with respect to reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form. |
(7) | That every prospectus: (i) that is filed pursuant to the immediately preceding paragraph, or (ii) that purports to meet the requirements of Section 10(a)(3) of the Securities Act of 1933 and is used in connection with an offering of securities subject to Rule 415, will be filed as a part of an amendment to the registration statement and will not be used until such amendment is effective, and that, for purposes of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(8) | Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrants of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. |
(9) | The undersigned Registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request. |
(10) | The undersigned Registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. |
Live Oak Acquisition Corp. II | ||
By: | /s/ Richard J. Hendrix | |
Name: | Richard J. Hendrix | |
Title: | Chief Executive Officer and Director |
Signature |
Title | |
/s/ Richard J. Hendrix Richard Hendrix |
Chief Executive Officer and Director (Principal Executive Officer) | |
* Andrea Tarbox |
Chief Financial Officer and Director (Principal Financial Officer and Principal Accounting Officer) | |
* John P. Amboian |
Director | |
* Jon Furer |
Director | |
* Tor Braham |
Director |
By: |
/s/ Richard J. Hendrix | |
Richard J. Hendrix Attorney-in-fact |
Exhibit 5.1
September 9, 2021
Live Oak Acquisition Corp. II
40 S. Main Street, #2550
Memphis, TN 38103
Re: | Registration Statement on Form S-4 (File No. 333-256880) |
Ladies and Gentlemen:
We have acted as counsel for Live Oak Acquisition Corp. II, a Delaware corporation (LOKB), in connection with the registration statement on Form S-4 (File No. 333-256880) initially filed by LOKB with the Securities and Exchange Commission, including the proxy statement/prospectus forming a part thereof (as amended through the date hereof, the Registration Statement), relating to the registration of 105,000,000 shares of LOKB Class A Common Stock, par value $0.0001 per share (the Company Shares), issuable pursuant to the Business Combination Agreement and Plan of Reorganization, dated as of May 6, 2021 (the Business Combination Agreement), by and among LOKB, Live Oak Merger Sub Inc. and Navitas Semiconductor Limited, a private company limited by shares organized under the Laws of Ireland and domesticated in the State of Delaware as Navitas Semiconductor Ireland, LLC.
In connection with the rendering of the opinion hereafter set forth, we have examined (i) the Registration Statement, (ii) the Business Combination Agreement, (iii) LOKBs amended and restated certificate of incorporation, (iv) LOKBs bylaws, (v) certain resolutions adopted by the board of directors of LOKB and (vi) such other certificates, statutes and other instruments and documents as we considered appropriate for purposes of the opinion hereafter expressed. In addition, we reviewed such questions of law as we considered appropriate.
In connection with rendering the opinion set forth below, we have assumed that (i) all information contained in all documents reviewed by us is true and correct, (ii) all signatures on all documents examined by us are genuine, (iii) all documents submitted to us as originals are authentic and complete and all documents submitted to us as copies conform to the originals of those documents, (iv) the Registration Statement, and any amendments thereto (including post-effective amendments), will be effective and (v) all Company Shares will be issued and delivered in accordance with the terms of the Business Combination Agreement and in the manner specified in the Registration Statement.
Based on the foregoing, and subject to the assumptions, qualifications, limitations and exceptions set forth herein, we are of the opinion that, when issued and delivered in accordance with the terms of the Business Combination Agreement, the Company Shares will be validly issued, fully paid and non-assessable.
This opinion is limited in all respects to the Delaware General Corporation Law and the Constitution of the State of Delaware, as interpreted by the courts of the State of Delaware and of the United States. We are expressing no opinion as to the effect of the laws of any other jurisdiction.
The opinion expressed herein is rendered solely in connection with the Registration Statement. The opinion expressed herein may not be relied upon for any other purpose.
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our firm in the Registration Statement under the caption Legal Matters. In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended.
Very truly yours, |
/s/ Vinson & Elkins L.L.P. |
Vinson & Elkins L.L.P. |
Exhibit 8.1
September 9, 2021
Live Oak Acquisition Corp. II
40 S. Main Street, #2550
Memphis, TN 38103
Re: Exhibit 8.1 Tax Opinion
Ladies and Gentlemen:
We have acted as counsel for Live Oak Acquisition Corp. II, a Delaware corporation (LOKB), in connection with (i) the planned transaction (the Business Combination) pursuant to the Business Combination Agreement and Plan of Reorganization, dated as of May 6, 2021 (as amended and supplemented through the date hereof and including the exhibits thereto, the Business Combination Agreement), by and among LOKB, Live Oak Merger Sub Inc., a Delaware corporation, and Navitas Semiconductor Limited, a private company limited by shares organized under the laws of Ireland and domesticated in the State of Delaware as Navitas Semiconductor Ireland, LLC, a Delaware limited liability company, and (ii) the preparation of the related registration statement on Form S-4 (File No. 333-256880) initially filed by LOKB with the Securities and Exchange Commission, including the combined proxy statement/prospectus forming a part thereof (as amended through the date hereof, the Registration Statement). This opinion letter is being delivered in connection with, and appears as an exhibit to, the Registration Statement.
In connection with the preparation of this opinion, we have examined the Business Combination Agreement, the Registration Statement and such other documents, records and papers as we have deemed necessary or appropriate. In addition, we have assumed that: (i) the Business Combination will be consummated in accordance with the provisions of the Business Combination Agreement and as described in the Registration Statement (and no covenants or conditions described therein and affecting this opinion will be waived or modified), (ii) the factual statements concerning the Business Combination and the parties thereto set forth in the Business Combination Agreement are true, complete and correct and the factual statements concerning the Business Combination Agreement, the Business Combination and the parties thereto set forth in the Registration Statement are true, complete and correct and, in each case, will remain true, complete and correct at all times up to and including the effective time of the Business Combination, (iii) all such statements qualified by knowledge, belief or materiality or comparable qualification are and will be true, complete and correct as if made without such qualification, (iv) all documents submitted to us as originals are authentic, all documents submitted to us as copies conform to the originals, all relevant documents have been or will be duly executed in the form presented to us and all natural persons who have executed such documents are of legal capacity, and (v) all applicable reporting requirements have been or will be satisfied. If any of the above described assumptions is untrue for any reason, our opinion as expressed below may be adversely affected.
Based upon and subject to the assumptions, limitations and qualifications set forth herein and in the Registration Statement, the discussion set forth in the Registration Statement under the caption Material U.S. Federal Income Tax ConsiderationsU.S. Federal Income Tax Considerations for Holders of Class A Common Stock insofar as it contains legal conclusions with respect to matters of U.S. federal income tax law constitutes our opinion.
We express no opinion on any issue or matter relating to the tax consequences of the Business Combination contemplated by the Business Combination Agreement or the Registration Statement other than the opinion set forth above. This opinion is rendered solely in connection with the filing of the Registration Statement and is not to be relied upon for any other purpose.
Vinson & Elkins LLP Attorneys at Law | 1001 Fannin Street, Suite 2500 | |
Austin Dallas Dubai Houston Los Angeles London New York | Houston, TX 77002-6760 | |
Richmond Riyadh San Francisco Tokyo Washington | Tel +1.713.758.2222 Fax +1.713.758.2346 velaw.com |
Live Oak Acquisition Corp. II September 9, 2021 Page 2 |
We hereby consent to the filing of this letter as an exhibit to the Registration Statement, and to the references to our firm name in the proxy statement/prospectus under the caption Material U.S. Federal Income Tax ConsiderationsU.S. Federal Income Tax Considerations for Holders of Class A Common Stock. In giving such consent, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations thereunder.
Very truly yours, |
/s/ Vinson & Elkins LLP |
Vinson & Elkins LLP |
Exhibit 8.2
DLA Piper LLP (US) 2000 University Avenue East Palo Alto, California 94303-2250 www.dlapiper.com |
September 9, 2021
Navitas Semiconductor Limited
22 Fitzwilliam Square South
Dublin, D02 FH68
Ireland
Ladies and Gentlemen:
We have acted as counsel to Navitas Semiconductor Limited, a private company limited by shares organized under the Laws of Ireland (Navitas Ireland) and domesticated as a limited liability company in the State of Delaware as Navitas Semiconductor Ireland, LLC (Navitas Delaware and, together with Navitas Ireland, Navitas), in connection with the preparation and execution of the Business Combination Agreement and Plan of Reorganization, dated as of May 6, 2021 (the Agreement), by and among Live Oak Acquisition Corp. II, a Delaware corporation (LOKB), Live Oak Merger Sub Inc., a Delaware corporation (Merger Sub), and Navitas. Unless otherwise indicated, any capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Agreement or the Registration Statement (as defined below).
The Tender Offer and the Merger and certain other matters contemplated by the Agreement are described in the Registration Statement filed by LOKB with the Securities and Exchange Commission on Form S-4 (Registration No. 333-256880) on the date hereof (the Registration Statement). This opinion is being rendered pursuant to the requirements of Item 601(b)(8) of Regulation S-K under the Securities Act of 1933, as amended.
In connection with this opinion, we have examined the Agreement, the Registration Statement, and such other presently existing documents, records and matters of law as we have deemed necessary or appropriate for purposes of our opinion. In addition, we have assumed, without any independent investigation or examination thereof, (i) that the Tender Offer and the Merger will be consummated in accordance with the provisions of the Agreement and as described in the Registration Statement and will be effective under applicable state and Irish law, and that the parties have complied with and, if applicable, will continue to comply with, the covenants, conditions and other provisions contained in the Agreement without any waiver, breach or amendment thereof; (ii) the continuing truth and accuracy at all times through the Effective Time of the statements, representations and warranties made by LOKB, Merger Sub and Navitas in the Agreement and the Registration Statement; (iii) the continuing truth and accuracy at all times through the Effective Time of the certificates of representations provided to us by LOKB, Merger Sub and Navitas on the date hereof; and (iv) that any such statements, representations or warranties made to the knowledge, or based on belief or intention, or similarly qualified, are true and accurate, and will continue to be true and accurate at all times through the Effective Time, without such qualification.
Navitas Semiconductor Limited
September 9, 2021
Page 2
In addition, we have examined, and have relied as to matters of fact upon, originals or copies, certified or otherwise identified to our satisfaction, of such records, agreements, documents and other instruments and made such other inquiries as we have deemed necessary or appropriate to enable us to render the opinion set forth below. In such examination, we have assumed the authenticity and accuracy of all documents reviewed by us (including the conformity to original documents of all documents submitted to us as email, fax or photostatic copies and the authenticity of the originals of such latter documents), that the signatures on all documents examined by us are genuine, and such documents reflect all material terms of the agreements between the parties to such documents, that the parties to such documents will comply with the terms thereof, and that such documents are enforceable in accordance with their respective terms. We have further assumed that the parties to the documents described herein will comply with all of their respective covenants, agreements and undertakings contained in those documents and that the transactions contemplated thereby will be carried out by the parties thereto in accordance with their terms. We have not, however, undertaken any independent investigation of any factual matter set forth in any of the foregoing.
Our opinion is based on the Internal Revenue Code of 1986, as amended, Treasury regulations promulgated thereunder, judicial decisions, published positions of the Internal Revenue Service, and such other authorities as we have considered relevant, all as in effect as of the date hereof and all of which are subject to change or differing interpretations, possibly with retroactive effect. There can be no assurance that changes in the law will not take place that could affect the conclusions expressed herein, or that contrary positions may not be taken by the Internal Revenue Service or that a court will not sustain any challenge by the Internal Revenue Service in the event of litigation. In the event any of the facts, statements, descriptions, covenants, representations, warranties, or assumptions upon which we have relied is incorrect, our opinion might be adversely affected and may not be relied upon.
Based upon and subject to the foregoing, and subject to the assumptions, qualifications and limitations described herein and in the Registration Statement, (i) we hereby confirm that the legal statements under the heading The Business CombinationMaterial U.S. Federal Income Tax ConsiderationsU.S. Federal Income Tax Considerations for Navitas Shareholders in the Registration Statement constitute our opinion as to the United States federal income tax law matters described therein, and (ii) we are of the opinion that, for U.S. federal income tax purposes, the Business Combination should qualify as a reorganization within the meaning of Section 368(a) of the Code and/or as a transaction governed by Section 351 of the Code.
We express our opinion herein only as to those matters specifically set forth above and no opinion should be inferred as to any other matters, including any tax consequences arising under any state, local or non-U.S. law, with respect to other areas of U.S. federal taxation, or with respect to any persons other than Navitas Shareholders. This opinion has been prepared solely in connection with the Registration Statement and may not be relied upon for any other purpose without our prior written consent.
This opinion is being delivered prior to the consummation of the Tender Offer and the Merger and therefore is prospective and dependent on future events. This opinion is expressed as of the date hereof, and we are under no obligation to supplement or revise our opinion to reflect any legal developments, any factual matters arising subsequent to the date hereof, or the impact of any information, document, certificate, record, statement, representation, covenant, or assumption relied upon herein that becomes incorrect or untrue.
Navitas Semiconductor Limited
September 9, 2021
Page 3
We hereby consent to the filing of this opinion as Exhibit 8.2 to the Registration Statement, and to the references to our firm name in the Registration Statement. In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder, nor do we thereby admit that we are experts with respect to any part of such Registration Statement within the meaning of the term experts as used in the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder.
Very truly yours,
DLA Piper LLP (US)
Exhibit 8.3
DLA Piper Ireland LLP 40 Molesworth Street Dublin 2 Ireland D02 YV57
T +353 1 436 5450 F +353 1 436 5451 W www.dlapiper.com |
Navitas Semiconductor Limited 22 Fitzwilliam Square South Dublin, D02 FH 68 Ireland |
Your reference
Our reference POD/POD/373423/37 /621650.5
9 September 2021 |
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Dear Sir or Madam,
RE: LIVE OAK ACQUISITION CORP. II BUSINESS COMBINATION
We have acted as Irish counsel to Navitas Semiconductor Limited, a private company limited by shares organized under the Laws of Ireland (Navitas Ireland) and domesticated as a limited liability company in the State of Delaware as Navitas Semiconductor Ireland, LLC (Navitas Delaware and, together with Navitas Ireland, Navitas), in connection with the preparation and execution of the Business Combination Agreement and Plan of Reorganization, dated as of 6 May 2021 (the Agreement), by and among Live Oak Acquisition Corp. II, a Delaware corporation (LOKB), Live Oak Merger Sub Inc., a Delaware corporation (Merger Sub), and Navitas. Unless otherwise indicated, any capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Agreement or the Registration Statement (as defined below).
The Tender Offer and the Merger and certain other matters contemplated by the Agreement are described in the Registration Statement filed by LOKB with the Securities and Exchange Commission on Form S-4 (Registration No. 333-256880) on the date hereof (the Registration Statement). This opinion is being rendered pursuant to the requirements of Item 601(b)(8) of Regulation S-K under the Securities Act of 1933, as amended.
In connection with this opinion, we have examined the Agreement, the Registration Statement, and such other presently existing documents, records and matters of law as we have deemed necessary or appropriate for purposes of our opinion. In addition, we have assumed, without any independent investigation or examination thereof, (i) that the Tender Offer and the Merger will be consummated in accordance with the provisions of the Agreement and as described in the Registration Statement and will be effective under applicable state and Irish law, and that the parties have complied with and, if applicable, will continue to comply with, the covenants, conditions and other provisions contained in the Agreement without any waiver, breach or amendment thereof; (ii) the consummation of the Tender Offer and the Merger will be effected for bona fide commercial reasons and does not form part of an arrangement or scheme of which the main purpose, or one of the main purposes, is the avoidance of liability to tax; (iii) the continuing truth and accuracy at all times through the Effective Time of the statements, representations and warranties made by LOKB, Merger Sub and Navitas in the Agreement and the Registration Statement; (iv) the continuing truth and accuracy at all times through the Effective Time of the certificates of representations |
DLA Piper Ireland LLP is a general partnership registered in the Republic of Ireland (number 628115) and authorised by the Legal Services Regulatory Authority to operate as a limited liability partnership under the Legal Services Regulation Act 2015 (registration number 1262464). DLA Piper Ireland LLP is part of DLA Piper, a global law firm operating through various separate and distinct legal entities. Its principal place of business is at 40 Molesworth Street, Dublin 2, Ireland, D02 YV57.
Partners: David Carthy Conor Houlihan Ciara McLoughlin Mark Rasdale John Magee Caoimhe Clarkin Maura Dineen Seán Murray Éanna Mellett Graham Quinn Kate Curneen Matthew Cole Simon Levine Andrew Darwin Sandra Wallace Jonathan Watkins Colin Wilson
A list of offices and regulatory information can be found at www.dlapiper.com.
Ireland Switchboard +353 1 436 5450
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POD/POD/373423/37
/621650.5
Continuation 2
9 September 2021
provided to us by LOKB, Merger Sub and Navitas on the date hereof; and (v) that any such statements, representations or warranties made to the knowledge, or based on belief or intention, or similarly qualified, are true and accurate, and will continue to be true and accurate at all times through the Effective Time, without such qualification.
In addition, we have examined, and have relied as to matters of fact upon, originals or copies, certified or otherwise identified to our satisfaction, of such records, agreements, documents and other instruments and made such other inquiries as we have deemed necessary or appropriate to enable us to render the opinion set forth below. In such examination, we have assumed the authenticity and accuracy of all documents reviewed by us (including the conformity to original documents of all documents submitted to us as email, fax or photostatic copies and the authenticity of the originals of such latter documents), that the signatures on all documents examined by us are genuine, and such documents reflect all material terms of the agreements between the parties to such documents, that the parties to such documents will comply with the terms thereof, and that such documents are enforceable in accordance with their respective terms. We have further assumed that the parties to the documents described herein will comply with all of their respective covenants, agreements and undertakings contained in those documents and that the transactions contemplated thereby will be carried out by the parties thereto in accordance with their terms. We have not, however, undertaken any independent investigation of any factual matter set forth in any of the foregoing.
Our opinion is based on provisions of the Taxes Consolidation Act 1997, as amended, and the regulations promulgated thereunder, judicial decisions, published guidance of the Irish Revenue Commissioners, and such other authorities as we have considered relevant, all as in effect as of the date hereof and all of which are subject to change or differing interpretations, possibly with retroactive effect. There can be no assurance that changes in the law will not take place that could affect the conclusions expressed herein, or that contrary positions may not be taken by the Irish Revenue Commissioners or that a court will not sustain any challenge by the Irish Revenue Commissioners in the event of litigation. In the event any of the facts, statements, descriptions, covenants, representations, warranties, or assumptions upon which we have relied is incorrect, our opinion might be adversely affected and may not be relied upon.
Based upon and subject to the foregoing, and subject to the assumptions, qualifications and limitations described herein and in the Registration Statement, (i) we hereby confirm that the legal statements under the heading The Business CombinationMaterial Irish Tax Consequences in the Registration Statement constitute our opinion as to the Irish tax law matters described therein, and (ii) we are of the opinion that, for Irish capital gains tax purposes, the Business Combination should qualify as a reorganisation of share capital within the meaning of Section 586 of the Taxes Consolidation Act 1997.
We express our opinion herein only as to those matters specifically set forth above and no opinion should be inferred as to any other matters, including any tax consequences arising by virtue of other areas of Irish tax law or any laws other than the laws of Ireland, or with respect to any persons other than Navitas Shareholders. This opinion has been prepared solely in connection with the Registration Statement and may not be relied upon for any other purpose without our prior written consent.
POD/POD/373423/37
/621650.5
Continuation 3
9 September 2021
This opinion is being delivered prior to the consummation of the Tender Offer and the Merger and therefore is prospective and dependent on future events. This opinion is expressed as of the date hereof, and we are under no obligation to supplement or revise our opinion to reflect any legal developments, any factual matters arising subsequent to the date hereof, or the impact of any information, document, certificate, record, statement, representation, covenant, or assumption relied upon herein that becomes incorrect or untrue.
We hereby consent to the filing of this opinion as Exhibit 8.3 to the Registration Statement, and to the references to our firm name in the Registration Statement. In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder, nor do we thereby admit that we are experts with respect to any part of such Registration Statement within the meaning of the term experts as used in the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder.
Yours faithfully,
DLA PIPER IRELAND LLP
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the use in this Registration Statement on Amendment No. 3 to Form S-4 of our report dated June 7, 2021, relating to the financial statements of Navitas Semiconductor Limited. We also consent to the reference to us under the heading Experts in such Registration Statement.
/s/ Deloitte & Touche LLP
Los Angeles, CA
September 9, 2021
Exhibit 23.2
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CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the inclusion in this Registration Statement on Amendment No. 3 to Form S-4 of Live Oak Acquisition Corp. II of our report dated June 7, 2021, relating to the financial statements of Navitas Semiconductor Limited as of and for the year ended December 31, 2019, which is included within the proxy statement/prospectus. We also consent to the reference to our firm under the caption Experts.
/s/ CohnReznick LLP
Los Angeles, California
September 9, 2021
Exhibit 23.3
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the use in this Registration Statement on Amendment No. 3 to Form S-4 of our report dated May 24, 2021, relating to the financial statements of Live Oak Acquisition Corp. II (as restated), which is contained in the Prospectus. We also consent to the reference to our Firm under the caption Experts in the Prospectus.
/s/ WithumSmith+Brown, PC | ||
New York, New York | ||
September 9, 2021 |