Introductory Note.
As previously disclosed, on March 20, 2021, Thoma Bravo Advantage (“TBA”) entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among TBA, ironSource Ltd., a company organized under the laws of the State of Israel (the “Company” or “ironSource”), Showtime Cayman, a Cayman Islands exempted company and wholly-owned subsidiary of the Company (“Merger Sub”), and Showtime Cayman II, a Cayman Islands exempted company and wholly-owned subsidiary of the Company (“Merger Sub II”).
On June 28, 2021 (the “Closing Date”), as contemplated by the Merger Agreement, Merger Sub merged with and into TBA (the “First Merger”), with TBA surviving the First Merger as a wholly owned subsidiary of the Company (such company, as the surviving entity of the First Merger, the “Surviving Entity”) and immediately following the First Merger and as part of the same overall transaction as the First Merger, the Surviving Entity merged with and into Merger Sub II (the “Second Merger” and, together with the First Merger, the “Mergers”), with Merger Sub II surviving the Second Merger as a wholly owned subsidiary of the Company (such company, as the surviving entity of the Second Merger, the “Surviving Company”). The transactions set forth in the Merger Agreement, including the Mergers, constituted a “Business Combination” as contemplated by TBA’s Amended and Restated Memorandum and Articles of Association (the “Business Combination”).
Additionally, on the Closing Date, existing shareholders of ironSource completed the sale of an aggregate of 133,254,045 Class A ordinary shares of ironSource (“Company Class A Ordinary Shares”) to certain accredited investors (“PIPE Investors”), at a price per share of $10.00, for gross proceeds to such sellers of approximately $1.33 billion (the “PIPE Investment”), pursuant to a series of Investment Agreements previously entered into between the PIPE Investors and ironSource and related Purchase and Sale Agreements entered into between PIPE Investors and such sellers pursuant to the Investment Agreements (collectively, the “Investment Agreements”). The PIPE Investors include Thoma Bravo Ascension Fund, L.P., an affiliate of Thoma Bravo, L.P., which invested $300.0 million, and Thoma Bravo Advantage Sponsor, LLC (“Sponsor”), the sponsor of TBA, that invested $32.5 million pursuant to its commitment to purchase additional Company Class A Ordinary Shares in the event redemptions by TBA shareholders exceed $150 million.
On the Closing Date and immediately prior to the consummation of the Mergers and the PIPE Investment, the Company effected a recapitalization whereby (i) the Company adopted amended and restated articles of association, (ii) each ordinary share of the Company that was issued and outstanding immediately prior to the Effective Time was renamed and became a Company Class A Ordinary Share, (iii) the Company declared and effected an in-kind dividend on each Company Class A Ordinary Share outstanding by distributing to each holder thereof one Class B ordinary share of ironSource (the “Company Class B Ordinary Shares”) for each Company Class A Ordinary Share held by such holder, (iv) each Company Class A Ordinary Share and each Company Class B Ordinary Share that was issued and outstanding immediately prior to the effective time was split into a number of Company Class A Ordinary Shares and Company Class B Ordinary Shares, respectively, in order to cause the value of the outstanding Company Ordinary Shares immediately prior to the Effective Time to equal $10.00 per share, based upon the equity value of the Company in the Mergers (the “Stock Split”), and (v) any outstanding stock options and restricted stock units of the Company issued and outstanding immediately prior to the Effective Time were adjusted to give effect to the foregoing transactions and remain outstanding.
Following such recapitalization (but before the Mergers), TBA purchased from certain existing shareholders of ironSource an aggregate of 6,745,955 Company Class A Ordinary Shares, at a price per share of $10.00, in a secondary sale for an aggregate purchase price equal to approximately $67.5 million.
