Supernova Partners Acquisition Company II, Ltd.

PROPOSED BUSINESS COMBINATION: Rigetti & Co., Inc.

ENTERPRISE VALUE: $1.152 billion

ANTICIPATED SYMBOL: RGTI

Supernova Partners Acquisition Company II, Ltd. proposes to combine with Rigetti & Co., Inc. (“Rigetti”), a pioneer in full-stack quantum computing.

• Rigetti is a leader in scalable quantum processor technology. Scalability has been among the largest hurdles to bringing quantum computing to market, and Rigetti introduced its scalable superconducting chips in June 2021.
• Its patented multi-chip architecture is the building block for new generations of quantum processors that are expected to achieve a clear advantage over classical computers.
• Quantum computing is one of the most transformative emerging technologies in the world today.
• Many of the world’s most important problems remain intractable, lying far beyond the capabilities of today’s supercomputers.
• Quantum computers process information in a fundamentally different way —  solving problems simultaneously as opposed to sequentially —  which will allow them, when scaled, to tackle problems of staggering computational complexity at unprecedented speed.
• Quantum computing could be applied to a range of important uses such as enabling biotech companies to bring more effective therapies to market faster; researchers to develop more affordable clean energy sources; and financial companies to access faster and more accurate market insights to help reduce market volatility.
• Rigetti’s distinctive quantum computers work in tandem with existing cloud and high-performance computing infrastructure to unlock powerful new capabilities to solve complex real-world problems. The company sells access to its machines through the Rigetti Quantum Cloud Services platform.

Rigetti expects to scale its quantum computers from 80 qubits in 2021, to 1,000 qubits in 2024, and to 4,000 qubits in 2026.

SUBSEQUENT EVENT – 12/23/21

Additional Subscription Agreements

• Supernova entered into subscription agreements with two “accredited investors” who have collectively subscribed for an additional 4,390,244 shares of Supernova common stock at a purchase price of $10.25 per share and an aggregate purchase price of approximately $45.0 million, bringing the aggregate amount of PIPE commitments to approximately $147.5 million.
  • The closing of the sale of PIPE II Shares pursuant to the PIPE II Subscription Agreements is conditioned upon, among other things, customary closing conditions and the consummation of the Business Combination. 

TRANSACTION

The business combination values the combined entity at a pro forma equity value of approximately $1.5 billion.

• Upon closing, the combined company will receive approximately $458 million in gross cash proceeds, including a fully committed PIPE of $102.51 million, direct investment, and $345 million of cash held in the trust account of Supernova II, assuming no redemptions.
• Rigetti will use the proceeds from the transaction to accelerate development of multiple generations of quantum processors and grow its commercial business.
• The PIPE transaction is subscribed to by top investors including:
  • Funds and accounts advised by T. Rowe Price Associates, Inc.; Bessemer Venture Partners; Franklin Templeton; and In-Q-Tel.
  • Strategic investors include Keysight Technologies and Palantir Technologies.
  • Ampere Computing will make a direct investment.
  • These new strategic investors provide strong complementary technologies for advancing Rigetti’s quantum advantage and build on Rigetti’s existing partnerships and collaborations with customers like Amazon Web Services, Astex Pharmaceuticals, DARPA, NASA, Standard Chartered Bank, and the U.S. Department of Energy.
• Rigetti CEO Chad Rigetti founded the company in 2013.

The company has raised approximately $200 million in venture capital and today employs more than 130 people with offices in the United States, Canada, U.K., and Australia.

PIPE

• PIPE Investors have committed to purchase in a private placement 10,251,000 shares of Supernova common stock (the “PIPE Shares”) at a purchase price of $10.00 per share and an aggregate purchase price of $102.51 million subscribed to by top investors including:
  • Funds and accounts advised by T. Rowe Price Associates, Inc.; Bessemer Venture Partners; Franklin Templeton; and In-Q-Tel.  Strategic investors include Keysight Technologies and Palantir Technologies.
  • Ampere Computing will make a direct investment.

Additional Subscription Agreements

• Supernova entered into subscription agreements with two “accredited investors” who have collectively subscribed for an additional 4,390,244 shares of Supernova common stock at a purchase price of $10.25 per share and an aggregate purchase price of approximately $45.0 million, bringing the aggregate amount of PIPE commitments to approximately $147.5 million.

WARRANT SUBSCRIPTION AGREEMENT

In connection with the execution of the Merger Agreement, Rigetti entered into a warrant subscription agreement with a strategic partner for the purchase of a warrant for an aggregate purchase price (including amounts from exercise) of $10,000,000.

• The warrant provides for the purchase of an aggregate of 1,000,000 shares of Rigetti common stock at an exercise price of $0.0001.
• The purchase of the warrant is conditioned upon, among other things, the consummation of the Business Combination and the entry into a collaboration agreement between Rigetti and the strategic partner.
• The strategic partner is required to pay $5 million to Rigetti no later than:
  • (i) the Closing
  • (ii) June 30, 2022, and upon such payment, the warrant will vest and be exercisable by the strategic partner with respect to 500,000 shares of Rigetti common stock pursuant to the terms of the warrant.
• The strategic partner is required to pay an additional $5 million to Rigetti no later than the second anniversary of the date of the warrant subscription agreement, and upon such payment, the warrant will vest and be exercisable by the strategic partner with respect to the remaining 500,000 shares of Rigetti common stock pursuant to the terms of the warrant.

SPONSOR SUPPORT AGREEMENT

•  The Sponsor has agreed that:
  • (i) 2,479,000 shares of Class B common stock issued in connection with the IPO (the “Sponsor Shares”) will be unvested and subject to forfeiture as of the Closing and will only vest if:
    • (a) During the five year period following the Closing, the VWAP of Supernova’s common stock equals or exceeds $12.50 for any twenty trading days within a period of thirty consecutive trading days,
  • (ii) up to an additional 1,000,000 Sponsor Shares will be unvested and subject to forfeiture as of the Closing based on the level of redemptions of Supernova Class A Ordinary Shares by holders thereof in connection with the transactions contemplated by the Merger Agreement, and any such additional Sponsor Shares will only vest if:
    • (b) During the five year period following the Closing, the VWAP of Supernova’s common stock equals or exceeds $15.00 for any twenty trading days within a period of thirty consecutive trading days. Any Sponsor Shares that remain unvested after the fifth anniversary of the Closing will be forfeited.

LOCK-UP

• Rigetti stockholders will be subject to certain restrictions on transfer with respect to the shares of Supernova common stock issued as part of the merger consideration (the “Lock-Up Shares”). Such restrictions begin at Closing and end on the date that is the earlier of:
  • (A) six months after the Closing
  • (B) the date on which the closing price of the Supernova common stock equals or exceeds $12.00 per share for any 20 trading days within any 30-trading day period commencing at least 90 days following the Closing
  • (D) the date on which Supernova consummates a sale, merger, liquidation, exchange offer or other similar transaction after the Closing Date that results in Supernova stockholders having beneficial ownership of less than 50% of the outstanding voting securities of the combined company which results in its stockholders having the right to exchange their shares for cash, securities or other property having a value that equals or exceeds $12.00 per share.

NOTABLE CONDITIONS TO CLOSING

• The consummation of the Transactions is subject to customary closing conditions, including, among other things, Supernova having at least $165,000,000 of available cash at the Closing.

NOTABLE CONDITIONS TO TERMINATION

• By either Supernova or Rigetti if the Transactions are not consummated on or before June 6, 2022.

ADVISORS

• Deutsche Bank Securities Inc. is serving as exclusive financial advisor to Rigetti.
• Cooley LLP is serving as legal counsel to Rigetti.
• Morgan Stanley & Co. LLC is serving as exclusive financial advisor to Supernova II.
• Latham & Watkins LLP is serving as legal counsel to Supernova II.
• Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc. served as placement agents to Supernova II for the PIPE financing.
• Sidley Austin LLP served as counsel to the placement agents.

MANAGEMENT & BOARD

Executive Officers

Robert D. Reid, 47
Chief Executive Officer and Director

Mr. Reid currently serves as Chief Executive Officer and a member of the board of directors of Supernova I. Prior to that he was a Partner at BDT Capital Partners and was a Senior Managing Director at Blackstone prior to July 2019, where he helped lead over 15 private equity investments representing over $40 billion in transaction value across a range of industries and geographies. In his 21 years at Blackstone, Mr. Reid sourced, evaluated and executed a range of transaction types including growth capital, buyouts and distressed opportunities. He was a member of Blackstone’s Private Equity Investment Committee and was one of the senior partners helping lead the firm’s private equity efforts in Europe from 2012 to 2016. Mr. Reid has served on a several public and private boards, including Scout24, one of the largest online classified business in Germany, SESAC, a large music performance rights organization Intelenet, a business process solutions company and Nielsen, a leading consumer and media measurement business. Prior to joining Blackstone, Mr. Reid worked in the Investment Banking division at Morgan Stanley. He earned a degree in economics and graduated magna cum laude from Princeton University.

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Michael S. Clifton, 41
Chief Financial Officer and Director

Mr. Clifton currently serves as Chief Financial Officer of Supernova I. Prior to that he was a senior investment professional at The Carlyle Group from 2010 to 2020 as a member of its flagship U.S. Buyout team where he helped lead Carlyle’s investing activities in the technology and business services sectors. During his tenure he worked on transactions involving companies in multiple sectors, including enterprise software, FinTech and IT services. He has served on four private boards and has been a board observer of a public company. In addition, Mr. Clifton currently serves as Managing Director of Ancient Management LP. Over his career, Mr. Clifton has been involved in transactions with a total value in excess of $30 billion, including multiple leveraged buyouts, growth investments, carve-outs, and turnarounds. Mr. Clifton has substantial public market experience and has helped lead the public exits of three portfolio companies, representing the sale of over $5 billion in equity. Prior to joining Carlyle, Mr. Clifton worked at two mid-market private equity firms, as well as in the M&A group of Bank of America Securities. He earned a Bachelor of Arts, cum laude, in classics from Davidson College, and an MBA with High Distinction from the Harvard Business School where he was a Baker Scholar.

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Board of Directors

Spencer M. Rascoff, 45
Co-Chair

Mr. Rascoff currently serves as Co-Chair of the board of directors of Supernova I. Mr. Rascoff served as CEO of Zillow from 2008 to 2018 and currently serves as chairman of dot.LA and chairman of Pacaso. During Mr. Rascoff’s tenure as Zillow’s CEO, he led the acquisition and subsequent integration of 15 businesses including the acquisition and integration of Trulia, Zillow’s then-largest direct competitor. He also led Zillow through its IPO, where he was instrumental in leveraging Zillow’s IPO as a substantial consumer branding event. During his tenure as Chief Executive Officer of Zillow, Mr. Rascoff created and maintained a corporate culture that was frequently recognized as exemplary, receiving awards from Fortune Best Places to Work, Glassdoor, The Seattle Times, and many other organizations. With a focus on diversity, equity and inclusion, Zillow created employee affinity networks and was twice named to Bloomberg’s Gender Equality Index. Prior to Zillow, Mr. Rascoff co-founded Hotwire, where he ran corporate development through the company’s launch, the aftermath of 9/11, and ultimately the sale of the business to Expedia for $685 million.  Mr. Rascoff is currently on the board of directors of Palantir. He formerly served on the board of directors of several other public and private technology companies, including Zillow Group, TripAdvisor, Zulily and Julep. Before his consumer Internet career, Mr. Rascoff worked in the Investment Banking division at Goldman Sachs and in private equity at TPG Capital. He is also a member of the Young Presidents’ Organization and has served as a Visiting Executive Professor at Harvard Business School. Mr. Rascoff graduated cum laude from Harvard University.

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Alexander M. Klabin, 44
Co-Chair

Mr. Klabin currently serves as Co-Chair of the board of directors of Supernova I. Mr. Klabin co-founded Senator Investment Group in early 2008 where he served as Managing Partner and Co-Chief Investment Officer until 2020 and has served as Executive Chairman of Sotheby’s Financial Services since October 2020. In addition, Mr. Klabin currently serves as Chairman and CEO of Ancient Management LP. Mr. Klabin built and scaled Senator to be a widely respected investment management firm that managed up to $10 billion in assets. During his tenure, Senator managed capital on behalf of many of the largest pensions, endowments, sovereign wealth funds, and family offices globally. Under Mr. Klabin’s leadership, Senator became known for pursuing differentiated thematic and event-driven investments in public and private securities across both credit and equity. Prior to co-founding Senator, Mr. Klabin worked at York Capital Management and Quadrangle Group. Mr. Klabin began his career in the M&A department at Goldman Sachs. He is a member of the board of directors of Enstructure, Faherty Brand and The Nantucket Project. Additionally, he serves as a Trustee of the New York Philharmonic, The Allen-Stevenson School and is a member of the Leadership Council of The Robin Hood Foundation. Mr. Klabin received a Bachelor of Arts degree in English Literature from Princeton University.

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