The Arrangement Agreement contains representations, warranties and covenants of the Company, the Canadian Sub and the Target that are generally customary for a transaction of this type.
The transaction is subject to customary closing conditions, including the receipt of certain regulatory approvals; the approval of the Ontario Superior Court of Justice (Commercial List); the approval by not less than two-thirds of the votes cast at a special meeting of Target shareholders, which is expected to take place in November 2021; no material adverse effect having occurred in respect of either the Company or the Target; and dissent rights not having been exercised with respect to more than 10% of Target’s outstanding common shares. The obligation of each party to consummate the Arrangement is also conditioned upon the other party’s representations and warranties being true and correct (subject to certain materiality exceptions) and the other party having performed in all material respects its obligations under the Arrangement Agreement. The transaction is not subject to any financing condition.
The Arrangement Agreement contains termination rights for each of the Company and the Target, including, among others, (1) if the Effective Time does not occur on or before February 13, 2022, subject to extension for certain limited purposes, including obtaining certain required regulatory approvals, and (2) subject to certain conditions, if the Target wishes to terminate the Arrangement Agreement to enter into a definitive agreement with respect to a Superior Proposal (as such term is defined in the Arrangement Agreement). Upon termination of the Arrangement Agreement under specified circumstances, including the termination by the Company in the event of a change of recommendation by the board of directors of the Target or by the Target to enter into a definitive agreement with respect to a Superior Proposal, the Target would be required to pay the Company a termination fee of approximately C$8.2 million. The Arrangement Agreement also provides for customary board support and non-solicitation covenants, subject to customary “fiduciary out” provisions.
The foregoing description of the Arrangement Agreement and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the Arrangement Agreement, which is attached hereto as Exhibit 2.1, and the Plan of Arrangement, which is included as a schedule to the Arrangement Agreement. We encourage you to read the Arrangement Agreement for a more complete understanding of the transaction. The Arrangement Agreement has been attached as an exhibit to this report to provide investors and security holders with information regarding its terms. The Arrangement Agreement is not intended to provide any factual information about the Target, Company or Canadian Sub.
| Item 3.02. | Unregistered Sales of Equity Securities. |
The information disclosed under Item 1.01 is incorporated into this Item 3.02 in its entirety.
Spire securities issued in connection with the Arrangement are expected to be issued in reliance upon an exemption from registration under federal securities laws provided by Section 3(a)(10) of the Securities Act of 1933, as amended (the “Securities Act”) for the issuance and exchange of securities approved after a public hearing on the fairness of the terms and conditions of the exchange by a court of competent jurisdiction at which all persons to whom the securities will be issued have the right to appear. The Arrangement will be subject to approval by the Ontario Superior Court of Justice (Commercial List). The Company anticipates that, if the Arrangement becomes effective under the terms and conditions set forth in the Arrangement Agreement (including receipt of the final order from the Ontario Superior Court of Justice (Commercial List)), the Class A common stock of the Company to be issued pursuant to the Arrangement will be exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) thereof.
On September 14, 2021, Spire and the Target issued a joint press release announcing the entry into the Arrangement Agreement, a copy of which is attached as Exhibit 99.1 and is incorporated herein by reference.
Cautionary Note Regarding Forward-Looking Statements
This communication contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally relate to future events or the Company’s future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern Spire’s expectations, strategy, plans or intentions. Spire’s expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected, including but not limited to: the risk that the transaction does not close, due to the failure of one or more conditions to closing or the failure of the businesses (including personnel) to be integrated successfully after closing; the risk that the transaction does not close, due to the failure of one or more conditions to closing or the failure of the businesses (including personnel) to be integrated successfully after closing; the risk that revenue and adjusted EBITDA accretion or the expansion of Spire’s customer count, ARR, product offerings and solutions will not be realized or realized to the extent anticipated; uncertainty as to the market value of consideration to be paid in the transaction; the risk that required governmental or exactEarth shareholder approvals of the Arrangement will not be obtained or that such approvals will be delayed beyond current expectations; the risk that following this transaction, Spire’s financing or operating strategies will not be successful; litigation in respect of either company or the transaction; and disruption from the transaction making it more difficult to maintain customer, supplier, key personnel and other strategic relationships. The forward-looking statements contained in this communication are also subject to other risks and uncertainties, including those more fully described under the caption “Risk Factors” in the Company’s filings with the Securities and Exchange Commission (“SEC”), including the Company’s Proxy Statement/Prospectus/Information Statement, which was filed with the Securities and Exchange Commission on July 22, 2021 and the Company’s Current Report on Form 8-K, which was filed with the SEC on August 20, 2021. The forward-looking statements in this communication are based on information available to Spire as of the date hereof, and Spire disclaims any obligation to update any forward-looking statements, except as required by law.
Additional Information and Where to Find It
This communication is being made in respect of a proposed arrangement involving Spire Global, Inc. and exactEarth Ltd. Further details of this transaction will be included in a management information circular to be mailed to exactEarth shareholders in accordance with applicable securities laws. Copies of the Arrangement Agreement and the
