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Big Cypress Acquisition Corp.

Big Cypress Acquisition Corp.

Dec 7, 2020 by Matt Cianci

PROPOSED BUSINESS COMBINATION: SAB Biotherapeutics

ENTERPRISE VALUE: $325 million
ANTICIPATED SYMBOL: SABS

Big Cypress Acquisition Corp. proposes to combine with SAB Biotherapeutics, a clinical-stage biopharmaceutical company with a novel immunotherapy platform that produces targeted, high potency, fully-human polyclonal antibodies at scale.

SAB Biotherapeutics is a clinical-stage biopharmaceutical company advancing a new class of immunotherapies based on its human polyclonal antibodies. Applying advanced genetic engineering and antibody science, SAB develops fully-human antibodies produced from transchromosomic (Tc) bovine™ herds targeted at addressing specific diseases, including infectious diseases such as COVID-19 and influenza, immune system disorders including type 1 diabetes and organ transplantation, and cancer. SAB’s versatile and scalable DiversitAb™ platform is applicable to a wide range of serious human diseases. It rapidly produces natural, specifically targeted, high-potency, human polyclonal immunotherapies at commercial scale. The platform has been developed and validated through funding awarded from US government emerging disease and rapid response programs. SAB is currently advancing multiple clinical programs in a number of indications, in addition to its collaborations with global pharmaceutical and other partners.

SAB plans to be listed on NASDAQ following the closing of the transaction. The proposed transaction implies an enterprise value for SAB, on a post-merger basis, of approximately $325 million (assuming a share price of $10.10 per share) and is expected to provide the combined company with approximately $118 million of pro forma cash (assuming no redemptions from Big Cypress’ trust account), to fuel development and commercialization of SAB’s unique DiversitAb™ platform that leverages its proprietary transchromosomic (Tc) bovine™ herds to produce highly-potent targeted fully-human polyclonal antibody therapeutics for a wide range of immune system disorders, cancer and infectious diseases without the need for human donors.

SUBSEQUENT EVENT – 8-K Link

On October 12, 2021, Big Cypress Acquisition Corp. and Radcliffe SPAC Master Fund, L.P. entered into a Forward Share Purchase Agreement (the “Purchase Agreement”) pursuant to which Radcliffe may elect to sell and transfer to the Company, and the Company will purchase from Radcliffe, on the later of:

  • (a) the first business day following the ninetieth (90th) day after the closing of the proposed business combination between the Company and SAB Biotherapeutics, Inc.
  • (b) the first business day following the ninety-fifth (95th) day after the closing of the Business Combination (the “Closing Date”), up to 1,390,000 shares of the Company’s common stock held by Radcliffe at the closing of the Business Combination (the “Radcliffe Shares”).

The price at which Radcliffe has the right to sell the Radcliffe Shares to the Company is $10.10 per share. Radcliffe will notify the Company in writing two business days prior to the Closing Date, specifying the number of Radcliffe Shares the Company is required to purchase.

Radcliffe is permitted at its election to sell any or all of the Radcliffe Shares in the open market commencing after the closing of the Business Combination, so long as the sale price exceeds $10.10 per share. In addition, upon the prior written consent of the Company, Radcliffe may sell the Radcliffe Shares at a price below $10.10.

SUBSEQUENT EVENT – 8-K Link

On August 12, 2021, Big Cypress Acquisition Corp., together with Big Cypress Merger Sub, Inc., and SAB Biotherapeutics, Inc., entered into a first amendment (the “Amendment”) to the business combination agreement dated June 21, 2021.

  • In accordance with the terms and subject to the conditions of the Business Combination Agreement, as amended pursuant to the Amendment, at the effective time of the Merger (the “Effective Time”):
    • (i) each outstanding share of SAB common stock and SAB preferred stock will be automatically canceled, extinguished, and converted into a number of shares of the Company’s common stock (the “New Company Shares”) based on SAB’s equity value.
    • (ii) holders of shares of SAB Biotherapeutics Common Stock and Preferred Stock will be entitled to receive their pro-rata share of additional New Company Shares being issued into escrow (the “Earnout Escrow Account”) at the closing (the “Earnout Shares”), which will be released if certain conditions are met within a five-year period following the closing of the Business Combination (the “Earnout Period”).
    • (iii) outstanding vested and unvested option to purchase shares of SAB common stock will be canceled in exchange for a comparable option to purchase New Company Shares based on the equity value of SAB with respect to vested options.
    • The Earnout Shares shall be released and delivered to the Stockholder Earnout Group as follows:
      • (A) 25% of the Sponsor Earnout Shares, if the VWAP of Company Shares is greater than or equal to $15.00 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days,
      • (B) 25% of the Sponsor Earnout Shares, if the VWAP of Company Shares is greater than or equal to $20.00 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days,
      • (C) 25% of the Sponsor Earnout Shares, if the VWAP of Company Shares is greater than or equal to $25.00 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days, and
      • (D) 25% of the Sponsor Earnout Shares, if the VWAP of Company Shares is greater than or equal to $30.00 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days.
  • In addition, the holders of such vested options shall also receive restricted stock units (the “Earnout RSUs”) based on the pro-rata percentage that the vested SAB options represent compare to the fully diluted share capital of SAB prior to closing.
    • The total maximum number of Earnout Shares and shares underlying the Earnout RSUs will be equal to 12,000,000 additional New Company Shares in the aggregate, which shares shall be allocated on a pro-rata basis among the SAB stockholders who have received New Company Shares and the holders of vested SAB stock options
  • Each Earnout RSU will be settled in New Company Shares, subject to the same milestones applicable to the Earnout Shares.

TRANSACTION

  • Upon the closing of the business combination, and assuming a share price of $10.10 per share and no redemptions of shares of Big Cypress by its public stockholders, SAB would be expected to have an enterprise value of approximately $325 million and cash resources of approximately $118 million, including the contribution of up to $116 million from cash held in Big Cypress’ trust account (less any redemptions).
  • Pro forma for the business combination, legacy shareholders of SAB will own approximately 68% of the post-merger public company, excluding any contingent consideration and before giving effect to any potential exercise of Big Cypress’ common stock purchase warrants into shares of common stock following the closing.
  • There is no minimum cash closing condition for the transaction.

Big Cypress trans overview

PIPE

  • There is no PIPE for the transaction

SPONSOR SUPPORT AGREEMENT

The Sponsor Parties have agreed to, among other things:

  • Subject 598,580 of their shares in the Company (the “Sponsor Earnout Shares”), to transfer restrictions during the period from and after the Closing until the fifth anniversary of the Closing (the “Sponsor Earnout Period”) to become freely tradeable as follows:
    • (A) twenty five percent (25%) of the Sponsor Earnout Shares, if the VWAP of Company Shares is greater than or equal to $15.00 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days,
    • (B) twenty five percent (25%) of the Sponsor Earnout Shares, if the VWAP of Company Shares is greater than or equal to $20.00 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days,
    • (C) twenty five percent (25%) of the Sponsor Earnout Shares, if the VWAP of Company Shares is greater than or equal to $25.00 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days, and
    • (D) twenty five percent (25%) of the Sponsor Earnout Shares, if the VWAP of Company Shares is greater than or equal to $30.00 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days.

LOCK-UP

  • The Sponsor and such SAB stockholders will agree not to effect any sale or distribution of New SAB equity securities held by them during the 180-day lock-up period

NOTABLE CONDITIONS TO CLOSING

  • There is no minimum cash closing condition for the transaction.

NOTABLE CONDITIONS TO TERMINATION

  • By the Company and SAB if the Business Combination is not closed by December 15, 2021 (the “Termination Date”)

ADVISORS

  • Lazard is serving as exclusive financial advisor to SAB
  • Stradling Yocca Carlson & Rauth is serving as legal counsel to SAB
  • Chardan is serving as exclusive M&A advisor and financial advisor to Big Cypress
  • Dentons US LLP is serving as legal counsel to Big Cypress.
  • Ladenburg Thalmann & Co. Inc. is acting as a capital markets advisor to Big Cypress.
  • Ladenburg Thalmann & Co. Inc. acted as sole book-running manager and Brookline Capital Markets, a division of Arcadia Securities, LLC, acted as co-manager of Big Cypress $115 million IPO in January 2021

MANAGEMENT & BOARD

Executive Officers

Samuel J. Reich, 45
Chief Executive Officer, Chief Financial Officer and Director

Mr. Reich co-founded Biscayne Neurotherapeutics, Inc. in 2011 and served as its Executive Chairman until its sale to Supernus Pharmaceuticals (Nasdaq: SUPN) in October 2018. Biscayne Neurotherapeutics was focused on novel treatments for seizure disorders. Previously, Mr. Reich was the Executive Vice President of OPKO Ophthalmologics, a division of OPKO Health, Inc. (Nasdaq: OPK) from March 2007 to November 2008, where Mr. Reich served on the executive committee and lead the Ophthalmologics business division. Prior to his position at OPKO, Mr. Reich was the Founder and Executive Vice President of Acuity Pharmaceuticals, Inc., where he worked from July 2002 through March 2007, at which time Acuity Pharmaceuticals merged with OPKO Health. Mr. Reich was a doctoral candidate in the Department of Ophthalmology at the University of Pennsylvania Medical School. He left graduate school prior to the completion of his Ph.D. in order to establish Acuity. Prior to that, he was a graduate student at the University of Pennsylvania in the Biomedical Studies graduate program. He has authored six peer- reviewed scientific publications, and is currently an inventor on sixteen issued U.S. patents and over 50 issued foreign patents. Mr. Reich holds a B.A. with High Honors in Biochemistry from Clark University, cum laude, Phi Beta Kappa.

Board of Directors

Jeffrey G. Spragens, 79
Non-Executive Chairman of the Board

From 2005 through 2013, Mr. Spragens was a Co-Founder and the CEO of SafeStitch Medical, Inc., a medical device company that pioneered incisionless surgery techniques that helps to relieve GERD and obesity. In 2013, SafeStitch merged with TransEnterix, Inc. (NYSE: TRXC). In addition, Mr. Spragens was one of the three founding board members of North American Vaccine, which became a publicly traded company in 1990. At North American Vaccine, Mr. Spragens was responsible for securing initial financing and building a commercial manufacturing facility. Mr. Spragens was instrumental in North American Vaccine’s acquisition by Baxter International (NYSE: BAX) in 1999. Mr. Spragens has also been a successful real estate developer and entrepreneur. Mr. Spragens was President of FCH services from 1973 until 1986. FCH developed and managed units of coop and condo housing financed with HUD financing with offices in several major cities. In 1986, Mr. Spragens converted to condo ownership 1,000 apartment units in San Mateo, California, resulting in one of the largest residential project in California at that time. Mr. Spragens was Managing Partner of Gateway Associates, Inc. from 1990 to 2000. In addition, Mr. Spragens developed, owned and operated apartment units in New Jersey, Michigan and Kansas, and has successfully sold many of these units. Mr. Spragens developed, and continues to own and operate Inman Grove Shopping Center in Edison, New Jersey. Mr. Spragens is also a well-known and respected philanthropist. Mr. Spragens is a Founding Board Member and Treasurer of Foundation for Peace. Foundation for Peace provides healthcare, education, and clean water to those in need in Dominican Republic and Haiti. He is also a member of the Board of Directors and Finance Committee of Hernia Help, which provides free hernia surgery to underserved children and adults in developing countries. Mr. Spragens has a BA from the University of Cincinnati, a Law Degree from George Washington University and an MA from American University.

James Martin, 54
Director

Since February 2017, Mr. Martin has served as the Chief Financial Officer of Cocrystal Pharma, Inc. (Nasdaq: COCP), a clinical stage therapeutic development company. From 2014 to 2017, Mr. Martin served as Chief Financial Officer of Scivac Therapeutics, Inc., a vaccine development and manufacturing company based in Rehovot, Israel. During his tenure, Scivac merged with Levon Resources, listed on the Toronto Stock Exchange, successfully obtained a dual listing on Nasdaq and Toronto Stock Exchange, and merged with VBI Vaccines (Nasdaq:VBIV). Additionally, from 2016 to 2017, Mr. Martin served as Chief Financial Officer of Motus GI Holdings, Inc. (Nasdaq: MOTS) a medical device company based in Haifa, Israel. From 2011 to 2013, Mr. Martin served as Chief Financial Officer of SafeStitch, Inc. Prior to that, Mr. Martin served as Chief Financial Officer of Avborne Heavy Maintenance, Inc., a venture capital owned aviation company from 2006 to 2011. During his tenure, Mr. Martin was played an integral role in the sale of Avborne Heavy Maintenance to AAR Corp (NYSE: AIR) in 2008. Mr. Martin has an MBA from Barry University and is a veteran of the U.S. armed forces after serving five years in the United States Navy.

Ilan Katz, 48
Director

Mr. Katz is a corporate attorney with over 20 years of experience specializing in mergers and acquisitions, with a focus on representing life science and technology companies. Mr. Katz is currently a Partner at Dentons where he has been since 2015. At Dentons, Mr. Katz focuses on mergers and acquisitions, private equity, securities law compliance and venture transactions from startups to publicly traded companies. He has previously counsel at Latham & Watkins LLP and served as lead U.S. M&A counsel for Siemens Corporation from 2011 to 2014. After clerking for a Federal judge, Mr. Katz began his career as an attorney at Skadden, Arps, Slate, Meagher & Flom LLP, and he also worked at Frank, Harris, Shriver & Jacobson LLP and Pepper Hamilton, LLP. In addition, Mr. Katz has demonstrated success as an entrepreneur. He co-founded Acuity Pharmaceuticals and served as its outside counsel, including representing Acuity in the reverse merger transaction which resulted in the creation and funding of OPKO Health. Mr. Katz has represented acquirers and target companies in many public and private merger and acquisitions. Mr. Katz has a J.D. from the University of Pennsylvania Law School, cum laude and Order Of The Coif. While at the University of Pennsylvania Law School, Mr. Katz was an Editor of the Law Review. Mr. Katz has a B.A. in economics from Brandeis University where he was magna cum laude.

Stephen D. Collins, MD, PhD., 68
Director

Dr. Collins has led or had senior leadership positions in multiple pharmaceutical and biotech companies in a wide range of therapeutic areas, resulting in over a dozen approved drugs and multiple company acquisitions totaling over $1.5 billion. Since 2013, he is Executive Chairman of Xalud Therapeutics, an anti-inflammatory focused company in Phase 2 clinical studies of a novel biological platform. Prior to this, he was most recently the President and CEO of Biscayne Neurotherapeutics. Prior to his position at Biscayne Neurotherapeutics, Mr. Collins was the CEO and President of NeuroTherapeutics Pharma, an early stage biotechnology company focused on the advancement of novel therapeutics for the central nervous system (CNS). Prior to his position at NeuroTherapeutics, he was Chief Scientific Officer & VP for Clinical Affairs of Ovation Pharmaceuticals, an oncology and CNS-focused biopharmaceutical company acquired by Lundbeck A/S. Dr. Collins joined Ovation in 2003, and was responsible for establishing the company’s R&D group. He was also responsible for establishing the safety and post-marketing research groups and led all scientific and medical in-licensing activities. Prior to joining Ovation, Dr. Collins served as a Global Director at Johnson & Johnson, overseeing early-stage development of a variety of agents and as a member of the global in-licensing advisory team. Prior to Johnson and Johnson, he worked in Abbott Laboratories’ Pharmaceutical and Hospital Products Divisions where he developed drugs for multiple indications and supported their business development groups in the review and acquisition of several assets. Dr. Collins has served on the faculty of medicine at Case Western Reserve University and the University of California-San Francisco. He earned his MD and PhD at Case Western Reserve University after completing undergraduate studies in Physics at the University of California, Berkeley.

 

ByMatt Cianci