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Chavant Capital Acquisition Corp. *

Chavant Capital Acquisition Corp. *

Jun 28, 2021 by sam.beattie

PROPOSED BUSINESS COMBINATION: Mobix Labs

ENTERPRISE VALUE: $276.4 million
ANTICIPATED SYMBOL: tbd

Chavant Capital Acquisition Corp. proposes to combine with Mobix Labs, an innovative provider of next-generation wireless mmWave 5G and connectivity solutions

  • Mobix Labs is a fabless semiconductor company developing disruptive wireless and connectivity solutions.
  • The Company’s universal CMOS-based chipset, which enables full 5G spectrum accessibility with higher performance and lower cost in a single SKU solution, is currently in development and sampling with key strategic partners and potential customers.
  • It is designed to accelerate and “future proof” 5G, thereby enabling the network infrastructure to support the continued explosion of data and realize next generation connected products and applications.
  • Mobix Labs is committed to simplifying the development process for customers and maximizing the performance of existing and next generation wireless products by delivering flexible, high performance, cost effective, and ultra-compact solutions.
  • Mobix Labs also has a full suite of connectivity solutions, including hybrid active optical cables, transceivers and optical engines, that offer high performance at longer distances in smaller form factors.
  • Mobix Labs’ technology is protected by extensive trade secrets and over 90 issued and pending patents.

SUBSEQUENT EVENT – 12/19/23 – LINK

  • PIPE
    • The SPAC entered into a subscription agreement with Sage Hill Investors, LLC and Mobix Labs pursuant to which Sage Hill has agreed to purchase, in a private placement to close substantially concurrently with the Closing of the Proposed Transaction, 1,500,000 shares of Class A Common Stock in cash at a price of $10.00 per share for an aggregate purchase price of $15,000,000.

SUBSEQUENT EVENT – 11/30/23 – LINK

  • Business Combination Amendments
    • The SPAC extended its Outside Date from November 22, 2023 to January 22, 2024.
    • They removed the condition to have at least $5,000,001 of net tangible assets after considering the PIPE Private Placement and Chavant’s Public Shareholders’ redemption rights, as per Chavant’s Existing Charter.
  • PIPE Warrants
    • In return for agreeing to these changes on November 26, 2023, Mobix Labs issued a warrant to the PIPE Investor.
    • This warrant allows the PIPE Investor to buy 700,000 shares of Mobix Labs’ common stock at a price of $0.01 per share.
    • The warrant becomes exercisable when the PIPE Subscription Agreement is closed and ends when either the Proposed Transaction closes or the Business Combination Agreement is terminated.
    • At the Proposed Transaction’s closing, the warrant will convert into 700,000 shares of Class A Common Stock of New Mobix Labs.

EXTENSION – 7/24/23 – LINK

  • The SPAC approved the extension from July 22, 2023 to January 22, 2024.
    • 77,130 shares were redeemed for $10.91 per share.
    • $0.05/share per month will be deposited into the trust account.

TRANSACTION

  • The transaction values Mobix Labs with an implied pro forma enterprise value of approximately $276 million and an implied pro forma equity value of approximately $295 million, at a price of $10.00 per share, assuming no redemptions by Chavant shareholders.
  • Mobix Labs equity holders will roll 100% of their existing equity holdings into the combined company.
  • The transaction includes a $30 million fully committed common stock PIPE at $10.00 per share.
  • In addition, Mobix Labs has signed a non-binding term sheet with B. Riley Principal Capital II, LLC for a $100 million equity line of credit to further support its growth strategy.
  • Mobix Labs believes that the transaction financing, combined with the equity line of credit and other financing that Mobix Labs and Chavant have agreed to cooperate to raise, will satisfy the minimum cash condition required to close the transaction and will provide the Company with resources to execute on its growth strategy.
  • Proceeds of the transaction are expected to be used for ongoing chipset development to capitalize on the large and rapidly expanding global demand for improved communication systems performance and for working capital.
  • Chavant has also agreed to prepare and file with the SEC a proxy statement for the purpose of seeking shareholder approval to extend the time period for it to consummate a business combination from January 22, 2023 to July 22, 2023 (the “Chavant Extension”)

Chavant Transaction Overview

SPAC FUNDING

PIPE Agreement

  • Chavant entered into a subscription agreement with ACE SO4 Holdings Limited
    • The transaction includes a $30 million fully committed common stock PIPE at $10.00 per share.
    • Chavant agreed to issue additional shares of Class A Common Stock to the PIPE Investor in the event that the volume weighted average price per share of the Class A Common Stock during the 30-day period commencing on the date that is 30 days after the date on which the PIPE Resale Registration Statement is declared effective (the “Adjustment Period VWAP”) is less than $10.00 per share.
    • In such case, the PIPE Investor will be entitled to receive a number of shares of Class A Common Stock equal to the product of
      • (x) the number of shares of Class A Common Stock issued to the PIPE Investor at the closing of the subscription and held by the PIPE Investor through the date that is 30 days after the effective date of the PIPE Resale Registration Statement multiplied by
      • (y) a fraction,
        • (A) the numerator of which is $10.00 minus the Adjustment Period VWAP and
        • (B) the denominator of which is the Adjustment Period VWAP. In the event that the Adjustment Period VWAP is less than $7.00, the Adjustment Period VWAP shall be deemed to be $7.00.
  • PIPE Warrants – LINK
    • In return for agreeing to these changes on November 26, 2023, Mobix Labs issued a warrant to the PIPE Investor.
    • This warrant allows the PIPE Investor to buy 700,000 shares of Mobix Labs’ common stock at a price of $0.01 per share.
    • The warrant becomes exercisable when the PIPE Subscription Agreement is closed and ends when either the Proposed Transaction closes or the Business Combination Agreement is terminated.
    • At the Proposed Transaction’s closing, the warrant will convert into 700,000 shares of Class A Common Stock of New Mobix Labs.

Non-binding Funding

  • In addition, Mobix Labs has signed a non-binding term sheet with B. Riley Principal Capital II, LLC for a $100 million equity line of credit to further support its growth strategy.

LOCK-UP

  • Sponsor and Company
    • 50% of the shares will be released One year after Closing or if the share price equals or exceeds $12.00 for any 20/30 trading days
    • 50% of the shares will be released One year after Closing or if the share price equals or exceeds $15.00 for any 20/30 trading days
  • The Sponsor is expected to agree to forfeit 658,631 Founder Shares that it holds and 400,000 Private Warrants that it holds, in each case upon the closing of the Proposed Transaction.

EARNOUT

  • Existing Mobix Labs shareholders will be entitled to receive 3.5 million new additional shares in the form of an earnout contingent on stock performance:
    • 1,750,000 (50% of the earnout shares) will vest if VWAP exceeds $12.50 for 20 out of 30 trading days during the earnout period.
    • 1,750,000 (50% of the earnout shares) will vest if VWAP exceeds $15.00 for 20 out of 30 trading days during the earnout period.
  • The shares will be held for Seven years

NOTABLE CONDITIONS TO CLOSING

  • Chavant having at least $5,000,001 of net tangible assets after giving effect to the Private Placements in accordance with the terms of the PIPE Subscription Agreement and following the exercise of redemption rights by Chavant shareholders in accordance with its organizational documents
    • They removed the condition to have at least $5,000,001 of net tangible assets after considering the PIPE Private Placement and Chavant’s Public Shareholders’ redemption rights, as per Chavant’s Existing Charter. – LINK
  • The Closing Available Cash shall not be less than $50.0 million (with a maximum of $10.0 million attributed to Mobix Labs’ equity line of credit and a minimum of $30.0 million attributed to the PIPE Subscription Agreement or similar agreements, and reduced by an amount equal to $5.0 million less any amount that is funded on or before the Closing Date, or irrevocably committed to be funded on or before the Closing Date, by the directors, officers and current stockholders of Mobix Labs and their respective affiliates, associates and family members).

NOTABLE CONDITIONS TO TERMINATION

  • By Chavant or Mobix Labs if the Closing has not occurred on or before July 22, 2023 or, if the Chavant Extension is not obtained, January 22, 2023
    • The SPAC extended its Outside Date from November 22, 2023 to January 22, 2024. – LINK
  • By Mobix Labs if no Chavant Extension is obtained by Chavant if Mobix Labs fails to deliver, on or before December 15, 2022, the PCAOB Audited Financials to Chavant in form and substance reasonably satisfactory to Chavant

ADVISORS

  • B. Riley Securities is serving as financial advisor to Mobix Labs.
  • Needham & Company, LLC is serving as financial advisor to Chavant.
  • Simpson Thacher & Bartlett LLP is serving as legal advisor to Chavant.
  • Greenberg Traurig, LLP is serving as legal advisor to Mobix Labs.
  • DLA Piper LLP (US) is serving as legal counsel to B. Riley Securities and Needham & Company, LLC.
  • Blueshirt Capital Advisors is also serving as an investor relations advisor to Mobix Labs.

EXTENSION – 7/14/22 – LINK

  • The SPAC approved the extension to complete a business combination from July 22, 2022 (which is 12 months from the closing of the IPO) to January 22, 2023.
    • 7,046,967 ordinary shares were redeemed for approximately $10.0147108/Share and the company will contribute $31,450.09/month for each month they extend.

SUBSEQUENT EVENT – 6/30/22 – LINK

  • On June 29, 2022, Chavant Capital Acquisition Corp. signed a non-binding Letter of Intent with a U.S.-based technology company (the “Target”).

MANAGEMENT & BOARD

Executive Officers

Jiong Ma, 57
Chief Executive Officer, President and Director

Since November 2020, Dr. Ma has been a Venture Partner at Braemar Energy Ventures (“Braemar”), an energy-focused venture capital firm. From 2008 to October 2020, Dr. Ma served as Senior Partner and a member of the investment committee at Braemar. While at Braemar, Dr. Ma has led investments in more than 15 companies involved in either resource efficiency, e-mobility, industrial digitalization, renewable energy, or deep tech, and has achieved multiple successful exits through M&A and IPO. During her career, she has served on the board of directors of more than 10 venture-backed companies, including Powervation (acquired by ROHM Semiconductor Ltd.), Convery Computer (acquired by Micron Technology, Inc.), mc10 (acquired by Medidata), and Carbonite Inc., which went public in 2011 and was subsequently acquired by OpenText (Nasdaq: OTEX) in 2019 for $1.45 billion. Dr. Ma currently serves on the board of Anavex Life Sciences Corp. (Nasdaq: AVXL) and as an advisory board member for each of Demeter Partners, a VC/PE fund dedicated to ecological and energy transformation in Europe, and National Renewable Energy Labs, a national laboratory of the U.S. Department of Energy which develops solutions to transform the generation, consumption, storage, and distribution of energy. From 2004 to 2008, Dr. Ma was an investment professional with the venture capital arm of 3i, a global private equity firm, where she led investments across multiple stages in technology and media, digital health, and cleantech. From 1997 to 2004, Dr. Ma held numerous senior positions at Lucent Technologies and Nortel Networks, where she was responsible for portfolio strategy, product development and research and development. In 2000, Dr. Ma co-founded Onetta Inc., an optical networking company, which was acquired by Bookham Technology in 2004. Dr. Ma holds a PhD in Electrical and Computer Engineering from the University of Colorado at Boulder, an MS in Electrical Engineering from Worchester Polytechnic Institute, and a BS in Physics and Electrical Engineering from Lanzhou University in China. Dr. Ma is also a Kauffman Fellow.

Michael Lee, 45
Chief Financial Officer

Mr. Lee has over 22 years of experience in private equity and finance. He is currently the managing member of New Highland LLC, a finance consultancy for start-ups which he joined in 2013. Previously, from 2001 to 2013, Mr. Lee was a Director at Lincolnshire Management, a private equity firm, where he managed acquisitions and corporate divestitures and served in officer and board member roles of portfolio companies. Mr. Lee started his career at the merchant banking division of Wachovia Bank. He received a BA in Economics, magna cum laude, from Princeton University.

Board of Directors

André-Jacques Auberton-Hervé, 59
Chairman of the Board of Directors

Dr. Auberton-Hervé serves as Chairman Emeritus of Soitec, a leader in Silicon-On-Insulator (SOI) technologies with a market capitalization of over $6 billion and a constituent company in the CAC Mid 60 Index, which he co-founded in 1992 out of a government laboratory and took public in Paris on the Euronext Stock Exchange in 1999. Serving for 23 years as Soitec’s President and Chief Executive Officer from July 1992 to January 2015, Dr. Auberton-Hervé was responsible for overseeing the company’s strategic, operational and financial activities that spanned across ten countries with five manufacturing facilities in Europe, Asia and the U.S. Dr. Auberton-Herve is the founder of 4A Consulting & Engineering, which provides strategic advice and consulting services with respect to renewable energy and digital innovation, and has served as its President and CEO since its founding in July 2015. In 2016, he became an operating partner of C4 Ventures, a leading European venture capital fund founded by Pascal Cagni (VP & GM EMEIA, Apple Inc., 2000-2012). In February 2018, he founded ATAJ, a company that he manages and that operates as advisor to Sofinnova Partners, a leading French venture capital fund, and its Sofinnova IT FPCI fund. Since January 2018, Dr. Auberton-Hervé has served as Chairman of the board of Bionik Laboratories Corp. In 2013, Dr. Auberton-Hervé was elected as Chairman of International Board of Directors of SEMI, the preeminent global industry association representing the electronics manufacturing industries. Dr. Auberton-Hervé is a recipient of numerous industry accolades, including the Audacity in Creativity Award from French President Jacques Chirac and the INSEAD Entrepreneurship Prize. Dr. Auberton-Hervé holds a doctorate degree with distinction in Physics from Ecole Centrale de Lyon. He is also a knight of the French Legion d’Honneur and the Ordre national du Mérite.

Karen Kerr, 52
Director Nominee

Dr. Kerr has over 25 years of experience in venture capital and technology investing. In May 2019, Dr. Kerr founded Exposition Ventures, a venture capital firm where she also serves as Managing Director. From April 2014 to April 2019, Dr. Kerr served as Executive Managing Director at GE Ventures, where she led investments in advanced manufacturing, supply chain technology, logistics, and enterprise software. Between 1996 and 2005, Dr. Kerr was a Managing Director at ARCH Venture Partners, where she helped grow assets under management to over $1 billion. Dr. Kerr has served as a director at Intellectual Ventures, and Senior Director of New Ventures and Alliances at the University of Southern California. Dr. Kerr started her career at Patricof & Co. and is a member of the Charter Class of Kauffman Fellows. Dr. Kerr is active on multiple boards, including the Kauffman Fellows, mHub, ORAU, the Clean Energy Trust and the Bryn Mawr College Board of Trustees. Dr. Kerr serves on the University of Chicago Physical Sciences Division and the Institute of Molecular Engineering Advisory Committees. Previously, Dr. Kerr served on the National Science Foundation’s Advisory Committee for the Small Business Innovative Research Program and on the National Institute for Standards and Technologies Visiting Committee on Advanced Technologies. Dr. Kerr earned a Ph.D. in Physical Chemistry from the University of Chicago and an A.B. in Chemistry from Bryn Mawr College. Dr. Kerr has been recognized as a Corporate Venture Capital Rising Star, a Crain’s Chicago Business Tech 50, one of LA’s Top Innovators, Crain’s Chicago Business 40 Under 40, and C200 Women Business Leaders.

Bernhard Stapp, 65
Director Nominee

Dr. Bernhard Stapp has served as President of CS-management GmbH, which provides consulting and advisory services to companies and investment firms with a focus on LED, OLED, photonics, cleantech and electronics materials, since November 2011. Between 2009 and 2011, Dr. Stapp served as Senior Vice President of Solid-State Lighting at OSRAM Licht AG, a global leader in optics and LED technology. Between 2001 and 2009, Dr. Stapp served in numerous roles at OSRAM Opto Semiconductors AG, including Chief Technology Officer and General Manager for LED and OLED components. Dr. Stapp began his career at Siemens AG where his roles included Head of Materials and Manufacturing, Group Leader of Functional Thin Films, and roles as Senior Scientist within the optical fiber, UV and ultrasound divisions. Dr. Stapp earned a Ph.D. in Metal Organics and a BS in Chemistry from the University Ulm in Germany.

Patrick J. Ennis, 57
Director Nominee

Dr. Patrick Ennis has over 30 years of experience as a scientist, engineer, businessman and venture capitalist. Since April 2019, Dr. Ennis has been a Venture Partner at Madrona Venture Group, a venture capital and private equity group focused on early-stage technology companies. Since April 2016, Dr. Ennis has served as a Director at Wipro Limited (NYSE: WIT), a global information technology, consulting and business process services company. From 2008 to March 2019, Dr. Ennis served as Global Head of Technology at Intellectual Ventures, a private equity firm specializing in invention, where he had responsibility for incubation, seed investments and technology commercialization, along with primary responsibility for investments in Asia. In January 2016, Dr. Ennis was the co-founding CTO of Xinova, a pioneer in global innovation market networks, and served as its CTO from inception to March 2019. From June 1998 to March 2008, Dr. Ennis was a Managing Director of ARCH Venture Partners, an early-stage venture firm, where he led seed and early-stage investments. He led the firm’s investments in Impinj (Nasdaq: PI) and Innovalight (acquired by DuPont). During his career, he has served on the boards of more than 20 venture-backed companies including Impinj, Innovalight, Kotura (acquired by Mellanox) and Artificial Muscle (acquired by Bayer Material Science). Prior to joining ARCH Venture Partners, Dr. Ennis held positions with Lucent Technologies, AT&T, and Bell Labs, where he led engineering projects for software development, speech recognition, network design and operations. Prior to Bell Labs, Dr. Ennis conducted research in Nuclear Physics at national and government laboratories in North America and Europe for seven years. Dr. Ennis is currently a Fellow at the Potomac Institute, a member of the University of Helsinki’s Commercialization Advisory Board, a member of the advisory board of Cybereason, a private global cybersecurity company, and an advisor to various companies in the defense industry. Dr. Ennis earned a Ph.D. and MS in Physics from Yale, an MBA from Wharton, and a BS in Math and Physics from the College of William & Mary where he was elected to Phi Beta Kappa. Dr. Ennis is a Kaufman Fellow.

 

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