As previously announced, on May 25, 2021, the Company, Tritium, Tritium DCFC Limited, an Australian public company limited by shares (“NewCo”), and Hulk Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of NewCo (“Merger Sub”), entered into a Business Combination Agreement, as amended on July 27, 2021 by the First Amendment to the Business Combination Agreement (the “Business Combination Agreement” and the transactions contemplated thereby, the “Business Combination”).
Waiver of the Minimum Cash Condition
Under the terms of the Business Combination Agreement, it is a condition precedent to the respective obligations of Tritium, NewCo and Merger Sub to consummate the Business Combination that, as of the closing of the Business Combination (the “Closing”), the amount of funds contained in the Company’s trust account (the “Trust Account”) (net of the aggregate amount of cash proceeds required to satisfy any exercise by the Company’s shareholders of their redemption rights and net of the Company’s fees and expenses incurred in connection with the Business Combination) plus the amount of cash proceeds to NewCo resulting from any private placements of ordinary shares in the capital of NewCo (“NewCo Ordinary Shares”) consummated in connection with the Closing be at least $200,000,000. In connection with the Business Combination, Tritium, NewCo and Merger Sub have waived such condition precedent.
The Closing is expected to occur on January 13, 2022. After the Closing and if the Post-Closing Financing (as defined below) is consummated, NewCo is expected to have a cash balance of approximately $120 million, after taking into account (i) approximately $8 million cash held by Tritium as at December 31, 2021; (ii) receipt of the funds remaining in the Trust Account after making payments due to the Company’s shareholders that exercise their redemption rights; (iii) payment of approximately $8 million of the parties’ fees and expenses related to the Business Combination due at Closing; (iv) receipt of $15 million of proceeds from the previously announced PIPE investment (the “PIPE”); (v) receipt of $45 million of proceeds from the Post-Closing Financing; and (vi) refinancing of certain of Tritium’s existing indebtedness (and related fees and expenses) with the proceeds from the $90 million debt facility with HealthSpring Life & Health Insurance Company, Inc., Cigna Health and Life Insurance Company and Barings Target Yield Infrastructure Debt Holdco 1 S.À R.L. (the “New Debt Facility”); in each case, subject to the satisfaction, amendment or waiver of conditions applicable to the respective commitments. NewCo is expected to have outstanding approximately $35 million of deferred payments triggered by the Business Combination, which includes payment of certain share-based compensation and related taxes under Tritium’s incentive plans and repayment of a shareholder loan; $48 million of deferred fees and expenses related to the Business Combination, and approximately $90 million of long-term indebtedness, consisting of the New Debt Facility, outstanding as of the Closing.
Post-Closing Financing
After Closing, NewCo expects to pursue additional financing in order to fund its capital needs (the “Post-Closing Financing”). NewCo also expects to receive backstop commitments from certain existing shareholders of Tritium and certain affiliates of the Company’s sponsor (the “Sponsor”) to purchase, at the option of NewCo, an aggregate of up to $45.0 million of NewCo Ordinary Shares at a purchase price of $6.00 per share within a specified period of time after Closing (the “Backstop Commitment”). NewCo intends to explore various options for the Post-Closing Financing. There is no guarantee that the Post-Closing Financing will involve the Backstop Commitment.
Ownership of NewCo
Assuming the redemption of an estimated 35 million shares of the Company’s Class A common stock and the shares issued pursuant to the PIPE and the Backstop Commitment, there are expected to be approximately 144.3 million NewCo Ordinary Shares outstanding following the consummation of the Business Combination. If the Post-Closing Financing involves the full Backstop Commitment, former Tritium shareholders are expected to own approximately 86.0% of the outstanding NewCo Ordinary Shares, former public stockholders of the Company are expected to own approximately 3.6% of the outstanding NewCo Ordinary Shares, the Sponsor and its affiliates are expected to own approximately 9.3% of the outstanding NewCo Ordinary Shares, and the PIPE investor is expected to own approximately 1.0% of the outstanding NewCo Ordinary Shares.