NextGen Acquisition Corp. II

PROPOSED BUSINESS COMBINATION: Virgin Orbit

ENTERPRISE VALUE: $3.218 billion

ANTICIPATED SYMBOL: VORB

NextGen Acquisition Corp. II proposes to combine with Virgin Orbit,  the responsive launch and space solutions company.

Virgin Orbit is selectively investing with constellation partners to provide end-to-end, value-added services for Earth Observation and the Internet of Things (IoT) applications, using the “Satellites as a Service” model. Virgin Orbit’s IoT offering will focus on connectivity applications for ship management, aircraft, pipeline monitoring, and intelligent agriculture, which has the potential to help improve efficiency across some of the world’s biggest industries.

Virgin Orbit is well positioned to expand through its combination of global reach; collaborative partnerships with customers and unique ability to provide end-to-end secure services through in-country launch with its transportable and mobile launch system. Virgin Orbit will seek to expand its Satellite as a Service activities beyond the previously announced investments in innovative satellite companies such as ArQit, HyperSat, and others. Virgin Orbit is entering into commercial partnerships with BigBear.ai and Redwire to develop and enhance next generation space solutions offerings.

Sir Richard Branson, the Founder of Virgin Orbit, said “The Virgin Orbit team has proven its ability to create new ideas, new approaches, and new capabilities. They are building on the incredible foundation of their rapid transition into successful commercial launch operations to find new ways to solve big problems that uplift our customers’ amazing ideas, again and again. I’m very excited we are taking Virgin Orbit public, with the support of our partners at NextGen and our other wonderful investors. It’s another milestone for empowering all of those working today to build space technology that will positively change the world.”

SUBSEQUENT EVENT  – 12/23/21

Additional PIPE Investment

• Virgin Group’s intent to purchase up to $100 million of Virgin Orbit common stock in an additional PIPE investment at a price per share of $10.00.
  • NextGen Acquisition Corp. II’s Sponsor will be supporting a portion of the Additional Equity Amount alongside the Virgin Group.
    • The Additional Equity Amount will be determined by the amount of investment, if any, required to satisfy the minimum cash condition as defined in the merger agreement up to a maximum amount of $100 million.

TRANSACTION

• Upon closing, the transaction is expected to provide the combined company up to $483 million in cash proceeds, including up to $383 million of cash held in the trust account of NextGen (assuming no redemptions) and a $100 million fully committed PIPE.
• The transaction values Virgin Orbit at an implied pro forma enterprise value of approximately US$3.2 billion and is expected to close around the end of the year, subject to, among other things, approval by NextGen’s shareholders and the satisfaction or waiver of other customary closing conditions.
• Existing Virgin Orbit shareholders will roll 100% of their equity into the combined company.
• Assuming no redemptions by NextGen’s shareholders, existing Virgin Orbit shareholders are expected to retain ownership of approximately 85% of the combined company, NextGen’s public shareholders are expected to own approximately 10% of the combined company, with PIPE investors and the SPAC sponsor expected to own approximately 3% and 2%, respectively, in each case, immediately following closing.

PIPE

• $100 million fully-committed PIPE at $10.00 per share led by strategic and institutional investors including Boeing and AE Industrial Partners, in addition to existing Virgin Orbit investors and NextGen

Additional PIPE Investment – 12/23/21

• • Virgin Group’s intent to purchase up to $100 million of Virgin Orbit common stock in an additional PIPE investment at a price per share of $10.00.
    • NextGen Acquisition Corp. II’s Sponsor will be supporting a portion of the Additional Equity Amount alongside the Virgin Group.
      • The Additional Equity Amount will be determined by the amount of investment, if any, required to satisfy the minimum cash condition as defined in the merger agreement up to a maximum amount of $100 million.

EARNOUT & SUPPORT AGREEMENT

• In addition, the Sponsor has agreed that 15% of the Founder Shares and 15% of the Founder Warrants will be unvested and subject to certain vesting triggers.
• If during the time period between August 22, 2021 and the five-year anniversary of the Closing
  • (x) the volume-weighted average price of NextGen Common Stock equals or exceeds $12.50 for any twenty trading days within a period of thirty consecutive trading days, then 50% of the unvested Founder Shares and 50% of the unvested Founder Warrants will vest (“Triggering Event I”)
  • (y) the volume-weighted average price of NextGen Common Stock equals or exceeds $15.00 for any twenty trading days within a period of thirty consecutive trading days, then the remaining 50% of the unvested Founder Shares and 50% of the unvested Founder Warrants will vest (“Triggering Event II”).
• In the event that there is an Acquiror Sale prior to the fifth anniversary of the Closing that will result in the holders of NextGen Common Stock receiving a price per share equal to, or in excess of, the applicable vesting price per share for Triggering Event I and/or Triggering Event II, then Triggering Event I and/or Triggering Event II, as applicable, will be deemed to occur immediately prior to the consummation of such Acquiror Sale, and upon such deemed occurrence or occurrences, the applicable amount of the unvested Founder Shares and the unvested Founder Warrants will immediately vest and be treated in the same manner as similar securities in such Acquiror Sale.
• Any unvested Founder Shares and Founder Warrants that do not vest upon an Acquiror Sale will be automatically forfeited, unless such Acquiror Sale provides for stock consideration to NextGen stockholders that will be publicly traded following closing of such Acquiror Sale, in which case the unvested Founder Shares and Founder Warrants will be rolled over as part of the Acquiror Sale and continue to be subject to vesting conditions as may be equitably adjusted to take into account the structure and consideration provided for in the Acquiror Sale.
• Any Founder Shares and Founder Warrants that remain unvested after the fifth anniversary of the Closing will be forfeited.

LOCK-UP

The Sponsor and the Sponsor Persons agreed not to

• (a) sell or otherwise dispose of, or agree to sell or dispose of, directly or indirectly, any shares of Vieco USA common stock or other capital stock of Vieco USA or any shares of Vieco USA common stock issuable upon the exercise of options, warrants or other convertible securities to purchase shares of Vieco USA common stock (“Lock-Up Shares”) held by the Sponsor and the Sponsor Persons immediately after the Closing
• (b) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of such Lock-Up Shares
• (c) publicly announce any intention to effect any transaction specified in clause (a) or (b), for the Lock-Up Period. The “Lock-Up Period” means
  • (x) for 25% of the Lock-up Shares, 180 days after the Closing (the “180 Day Lock-up Period”)
  • (y) for 25% of the Lock-up Shares, 18 months after the Closing
  • (z) for 50% of the Lock-up Shares, 24 months after the Closing.
    • If (i) at least 120 days have elapsed since the Closing
    • (ii) the 180 Day Lock-up Period is scheduled to end during a blackout period or within five trading days prior to a blackout period, the 180 Day Lock-up Period will end ten trading days before the start of the blackout period, subject to certain conditions.
• The Sponsor Support Agreement will terminate upon the termination of the Merger Agreement if the Closing does not occur.

The Key Stockholder

• The Key Stockholder also agreed not to
  • (a) sell or otherwise dispose of, or agree to sell or dispose of, directly or indirectly, any Lock-Up Shares held by the Key Stockholder immediately after the Closing,
  • (b) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of such Lock-Up Shares, or
  • (c) publicly announce any intention to effect any transaction specified in clause (a) or (b), for the Lock-Up Period. If
    • (i) at least 120 days have elapsed since the Closing and
    • (ii) the 180 Day Lock-up Period is scheduled to end during a blackout period or within five trading days prior to a blackout period, the 180 Day Lock-up Period will end ten trading days before the start of the blackout period, subject to certain conditions.

NOTABLE CONDITIONS TO CLOSING

• $200,000,000 (the “Minimum Cash Condition”)
• If, after the deadline for Acquiror Share Redemptions, the sum of:
  • (x) the Trust Amount plus 
  • (y) the PIPE Investment Amount, is reasonably expected to be less than $200,000,000, then, at or prior to the Closing, Virgin Investments Limited and its affiliates (collectively, “VIL”) will have the right (but not the obligation) to purchase up to $100,000,000 of additional shares of NextGen Common Stock at a price per share of $10.00 (the dollar value of such purchase, the “Additional Equity Amount”).
    • If VIL elects to purchase such additional shares and the aggregate of the Trust Amount after the deadline for the Acquiror Share Redemptions, the PIPE Investment Amount and the Additional Equity Amount equal or exceed $200,000,000, then the Minimum Cash Condition shall be deemed satisfied.

NOTABLE CONDITIONS TO TERMINATION

•  May 23, 2022 (the “Agreement End Date”)

ADVISORS

• Credit Suisse Securities (USA) LLC is serving as lead financial advisor and lead capital markets advisor to Virgin Orbit and co-lead placement agent for the PIPE transaction.
• Perella Weinberg Partners L.P. and LionTree LLC are also serving as additional financial advisors to Virgin Orbit.
• Latham & Watkins LLP is serving as legal advisor to Virgin Orbit.
• Goldman Sachs & Co. LLC is serving as exclusive financial advisor to NextGen and as co-lead placement agent for the PIPE transaction.
• Rothschild & Co is acting as an additional financial advisor to NextGen.
• Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor to NextGen.
• Sullivan & Cromwell LLP is serving as legal advisor to the placement agents.

MANAGEMENT & BOARD

Executive Officers

Patrick T. Ford, 33
Chief Financial Officer and Secretary

Mr. Ford has served as the Chief Financial Officer and Secretary of NextGen I since July 2020. Mr. Ford has spent over a decade working in the financial services industry, including as Director of Investments of Glen Capital, which he joined in 2015. Prior to Glen Capital, Mr. Ford was Vice President of Chestnut Securities, Inc., where he advised healthcare, technology and industrial clients on equity and debt placements, M&A advisory, financial planning & analysis, valuation and tender defense. Mr. Ford is a CFA® charterholder and CFP® certificant. Mr. Ford holds a B.A. in Russian from Middlebury College.

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Board of Directors

George N. Mattson, 54
Co-Chairman

Mr. Mattson served as a director of the Board of Directors of NextGen I since July 2020 and as Co-Chairman of NextGen I since September 2020. Mr. Mattson is an independent investor focusing on control investment in lower middle market companies. Mr. Mattson served as a Partner and Co-Head of the Global Industrials Group in Investment Banking at Goldman, Sachs & Co. from November 2002 through August 2012. Mr. Mattson joined Goldman Sachs in 1994 and served in a variety of positions before becoming Partner and Co-Head of the Global Industrials Group. Mr. Mattson serves as a director of Delta Air Lines, Inc. (NYSE: DAL), where he is chair of the Finance Committee, a director of Air France-KLM S.A. (PAR: AF) and Virgin Galactic Holdings, Inc. Mr. Mattson holds a B.S. degree in Electrical Engineering from Duke University and an M.B.A. from the Wharton School of the University of Pennsylvania.

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Gregory L. Summe, 64
Co-Chairman

Mr. Summe served as a director of the Board of Directors of NextGen I since July 2020 and as Co-Chairman of NextGen I since September 2020. Mr. Summe is the Founder and Managing Partner of Glen Capital Partners LLC, a value-oriented investment fund. From 2009 to 2014, Mr. Summe was the Managing Director and Vice Chairman of Global Buyout at the Carlyle Group. Prior to joining Carlyle, Mr. Summe was the Chairman, CEO and President of PerkinElmer, Inc., a global provider of products, services and solutions for the diagnostics, life sciences and applied markets which he led from 1998 to 2009. He also served as a Senior Advisor to Goldman Sachs Capital Partners from 2008 to 2009. Prior to joining PerkinElmer, Mr. Summe was with AlliedSignal, now Honeywell International, serving successively as the President of General Aviation Avionics, President of the Aerospace Engines Group, and President of the Automotive Products Group. Before joining AlliedSignal, he was the General Manager of Commercial Motors at General Electric and was a Partner with the consulting firm McKinsey & Company, Inc. Mr. Summe serves as a director of NXP Semiconductors N.V. (Nasdaq: NXPI), the State Street Corporation (NYSE: STT), Avantor Inc. (NYSE: AVTR), Ohana Biosciences, and the Pella Corporation. He chairs the Nominating & Governance Committees at NXP Semiconductors, State Street and Avantor along with the Strategy Committee at State Street and the Compensation Committee at Pella. He was previously the chairman of the board of directors of Freescale Semiconductor and Euromax International, and a director of Biomet Inc., TRW Inc., LMI Aerospace, Veyance, and Automatic Data Processing, Inc. (Nasdaq: ADP). Mr. Summe holds B.S. and M.S. degrees in electrical engineering from the University of Kentucky and the University of Cincinnati, and an M.B.A. with distinction from the Wharton School at the University of Pennsylvania. He is in the Engineering Hall of Distinction at the University of Kentucky.

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Jeffrey M. Moslow, 56
Director

Mr. Moslow served as a director of the Board of Directors of NextGen I since October 2020. Since 2012, Mr. Moslow, in partnership with Mr. Mattson, has personally made control investments in lower middle market private industrial companies with a strategic focus on partnering with founders and management teams to provide capital and experience to drive organic and inorganic growth. Prior to 2012 Mr. Moslow was a partner at Goldman Sachs & Co. Over the course of his career he ran Investment Banking Services, which had oversight of the relationships of Corporate and Sponsor clients in the Americas. He also served on the Commitments Committee which had global oversight for reviewing firm wide underwriting for diligence and reputational issues. Mr. Moslow was also a trusted advisor to many companies across all industries. He serves on the boards of numerous nonprofit organizations, including his alma mater, Tufts University where he is currently the Vice Chairman, chairs the Finance Committee and is a member of the Investment Committee for the endowment. He has also chaired numerous audit and risk committees for nonprofit organizations. Mr. Moslow holds B.S. degrees in Classics and Economics from Tufts University and a Juris Doctor degree from Harvard Law School.

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Josef H. von Rickenbach, 66
Director

Mr. von Rickenbach served as a director of the Board of Directors of NextGen I since October 2020. Mr. von Rickenbach is the Managing Director of stet vision LLC. He serves as Chairman of the Board at ZAGENO and also as a Director on the Board of Aileron Therapeutics. Previously Mr. von Rickenbach was co-Founder, President & CEO of biotech company Helio Vision, Inc., a Boston-based ophthalmic biopharma company developing a therapy for proliferative vitreoretinopathy (PVR). Helio Vision was merged into Aldeyra Therapeutics (NASDAQ: ALDX) in early 2019. Mr. von Rickenbach was co-Founder, Chairman & CEO of PAREXEL International Corporation. He took PAREXEL from its pioneering beginnings as one of the first clinical research organizations (CROs) in the early 1980s to one of the top three global biopharmaceutical services providers. He led PAREXEL through its IPO, multiple public offerings, and over 40 mergers and acquisitions during his 36 years at the helm of the company, expanding its services portfolio to meet changing client needs and market demand. Under his leadership, PAREXEL evolved to provide a comprehensive range of drug development services, including globally integrated clinical development, regulatory affairs consulting, commercialization services and information technologies that expedite time-to-market. In a “going private” transaction in 2017, PAREXEL was acquired for $5 billion by Pamplona Capital Management. Mr. von Rickenbach holds a B.A. in Business Economics from Lucerne University in Switzerland and an M.B.A. from Harvard Business School.

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Melina E. Higgins, 53
Director

Ms. Higgins joined Goldman, Sachs & Co. in 1989 and retired as a Partner in 2010. She was Head of the Americas for Private Debt and served on the Principal Investment Area Investment Committee that approved and oversaw global private equity and private debt investments. She was co-chairperson of the Investment Advisory Committee for the Goldman Sachs mezzanine funds and previously served on the Investment Committee for the Urban Investment Group. U.S. Banker ranked her as one of the Top 20 Nonbank Women in Finance. Ms. Higgins has significant board experience, having served on the boards of directors of over a dozen companies. She is currently chairperson of Antares Midco, Inc. and a director of Genworth Financial, Inc. and Viatris Inc., where she serves as chair of the Finance Committee. Ms. Higgins is a member of the Women’s Leadership Board at Harvard University’s John F. Kennedy School of Government. She holds an M.B.A. from Harvard Business School and a B.A. in Economics and Spanish from Colgate University.

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