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Arrowroot Acquisition Corp. *

Arrowroot Acquisition Corp. *

Feb 11, 2021 by Kristi Marvin

PROPOSED BUSINESS COMBINATION: iLearningEngines

ENTERPRISE VALUE: $1.386 billion
ANTICIPATED SYMBOL: AILE

Arrowroot Acquisition Corp. entered into a merger agreement with iLearningEngines, a leader in AI-powered learning automation and information intelligence for corporate and educational use

  • iLearningEngines’ AI and Learning Automation platform is used by enterprises to productize their enterprise knowledge for consumption throughout the enterprise.
  • The intense demand for scalable outcome-based training has led to deployments in some of the most regulated and detail-oriented vertical markets, including Healthcare, Education, Insurance, Retail, Oil & Gas / Energy, Manufacturing and Government.
  • iLearningEngines was founded by Harish Chidambaran in 2010, with headquarters in Bethesda, MD and offices in Dubai, UAE, Sydney, Australia, and India.

SUBSEQUENT EVENT – 3/28/24 – LINK

  • The SPAC the following BCA developments:
    • The SPAC and Cantor Fitzgerald entered into the Fee Reduction Agreement, pursuant to which Cantor agreed to forfeit $4,062,500 of deferred underwriting fees payable in connection with the IPO, resulting in a remainder of $6,000,000 of deferred underwriting fees payable by Arrowroot to Cantor subject to the closing of the Business Combination.
    • The Reduced Deferred Fee shall be payable to Cantor in the form of shares of New iLearningEngines Common Stock issuable upon the filing with the SEC of a resale registration statement.
    • The Sponsor has agreed to forfeit 400,000 Founder Shares upon the Closing.

EXTENSION – 2/6/24 – LINK

  • The SPAC approved an extension from February 4, 2024 to August 6, 2024.
    • The redemption results were not provided.
    • No contribution will be made into the trust account.
  • Before the meeting, 410,456 shares would not be redeemed, in exchange for 41, 046 shares of Class B common stock from the sponsor.

TRANSACTION

  • Upon closing of the transaction, the combined company will be named iLearningEngines, Inc., and is expected to remain listed on the NASDAQ under the new ticker symbol, ‘AILE’.
  • The combined company will continue to be led by iLearningEngines’ existing CEO and founder, Harish Chidambaran.
  • The transaction has been unanimously approved by the Board of Directors of Arrowroot Acquisition Corp., as well as the Board of Directors of iLearningEngines.

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SPAC FUNDING

  • iLearningEngines will receive proceeds of a private convertible offering with participation from Arrowroot Capital and other institutional investors at the time the transaction is announced.
  • iLearningEngines is also in discussions to raise additional capital via institutional investors.

Forward Purchase Agreement

  • ARRW agreed to purchase up to 2,500,000 shares from Polar at $10.77 per share (the “Initial Price”, which is $10.17 (the “Redemption Price”, plus $0.60).
    • In exchange for ARRW’s purchase of the shares, Polar agreed to waive redemption rights on the shares that Polar owns in connection with the Business Combination.
    • The scheduled maturity date of the forward transaction is one year from the Closing of the Business Combination.
    • The Maturity Date may be accelerated if the shares trade under $2.00 for 10 out of 30 days or the shares are delisted by Nasdaq.
    • Polar has the right to early terminate the transaction (in whole or in part) before the Maturity Date by delivering notice to ARRW.
    • If Polar terminates the Forward Purchase Agreement with respect to some or all of the shares prior to the Maturity Date, Polar will return an amount to ARRW equal to the number of terminated shares multiplied by the Redemption Price.
    • ARRW can terminate the Forward Purchase Agreement prior to the redemption deadline if ARRW pays Polar a $300,000 break-up fee.
    • On the Maturity Date, ARRW may be required to make a cash payment to Polar if Polar has not terminated the Forward Purchase Agreement in full equal to the number of shares (less any shares terminated prior to the Maturity Date) multiplied by $0.60.

LOCK-UP

  • Company and SPAC
    • One year following the Closing Date or if the share price equals or exceeds $12.00 for any 20/30 trading days at least 150 days after the Closing.

NOTABLE CONDITIONS TO CLOSING

  • The agreement includes a minimum cash requirement of $100 million that will be funded through several sources.

NOTABLE CONDITIONS TO TERMINATION

  • If the Closing has not occurred on or before November 30, 2023.

ADVISORS

  • iLearningEngines Advisors:
    • Cooley LLC is serving as legal counsel
    • Mizuho and its affiliate Greenhill & Co. served as exclusive financial advisor
  • Arrowroot Advisors:
    • Goodwin Procter LLP is serving as legal counsel
    • BTIG, LLC, Benchmark Company and Northland Capital served as financial advisors

EXTENSION – 3/6/23 – LINK

  • The SPAC approved the extension from March 4, 2023 to July 6, 2023 and to allow Arrowroot, without another stockholder vote, to elect to extend the Termination Date to consummate a Business Combination on a monthly basis up to seven times by an additional one month until February 4, 2024.
    • 24,304,187 shares were redeemed.
    • $640K to extend to 7/6/23; $160K per month (x7) to extend to 2/4/24 will be deposited into the trust account.

MANAGEMENT & BOARD

Executive Officers

Matthew Safaii, 41
Chief Executive Officer and Chairman of the Board

Matthew Safaii is the founder and Managing Partner of Arrowroot Capital, an investment advisory firm, which he founded in January 2014. Mr. Safaii serves as a Director at SnapLogic, Inc., a cloud connection company, which he joined in September 2019. Previously, Mr. Safaii served as a Managing Director and Head of the Acquisitions Team at Actua Corp., a venture capital firm, from June 2009 to December 2013.

Thomas Olivier, 53
President, Chief Financial Officer and Vice Chairman

Thomas Olivier is a Managing Director at Houlihan Lokey, Inc., a large investment bank, which he joined in May 2017. Upon completion of this offering, Mr. Olivier will join Arrowroot Capital and may remain affiliated with Houlihan Lokey in an advisory role for a limited period of time to complete and/or transition certain ongoing engagements. Previously, Mr. Olivier served as a Managing Director at Pacific Crest Securities, Inc., an investment bank focused on the technology sector, from April 2012 to May 2017.

Board of Directors

Gaurav Dhillon, 55 [Resigned 10/29/21]
Director 

Mr. Dhillon is the Chairman and Chief Executive Officer of SnapLogic, Inc., a cloud connection company, which he joined in 2009. Previously, Mr. Dhillon was also the Founder of Jaman.com Inc., a video streaming software company, from 2005 to July 2015. Prior to that, Mr. Dhillon was the Chief Executive Officer and Co-Founder of Informatica LLC, a software developer, from 1992 to 2004.

Dixon Doll, 78
Director 

Mr. Doll currently serves on the Advisory Board for the Stanford Institute for Economic Policy Research Institute, a nonprofit research institution, which he joined in 2002. Mr. Doll is a Senior Director at Roman DBDR Tech Acquisition Corp. (Nasdaq: DBDR), a special purpose acquisition company, which he joined in October 2020. Mr. Doll is a Director at Prime Impact Acquisition I (NYSE: PIAI), a special purpose acquisition company, which he joined in September 2020. Previously, Mr. Doll served as the Chairman of Network Equipment Technologies, Inc., a communication equipment company, from 2005 to 2011 and as a Director of DirecTV, Inc., a broadcast satellite services provider, from 2010 to 2015. Mr. Doll was elected to the Board of the National Venture Capital Association in 2005 and served on the Executive Committee and as Chairman from 2008 to 2009. Mr. Doll led DCM Ventures’ investments in About.com (acquired by The New York Times Co.), @Motion (acquired by Openwave), Clearwire (Nasdaq: CLWR), Coradiant (acquired by BMC), Force10 Networks (acquired by Dell), Foundry Networks (Nasdaq: FDRY), Internap (Nasdaq: INAP), Ipivot (acquired by Intel), and Neutral Tandem (Nasdaq: TNDM).

Will Semple, 43
Director 

Mr. Semple currently serves as a Director and Board Member of eBAY SARL, the European division of eBay, Inc. (Nasdaq: EBAY), a large multinational e-commerce company, which he joined in September 2019. Previously, Mr. Semple served as EMEA Lead of DevSecOps and Software Security & Assurance for PricewaterhouseCoopers LLP, a large consulting and accounting firm, from January 2016 to September 2019.

Peter Kuper, — [Appointed 3/4/22]
Director 

Mr. Kuper is currently a Managing Partner of HypAdvisor Consulting LLC, a technology consulting firm, and has held this position since September 2008. Mr. Kuper is also a Venture Partner at ClearSky, a venture capital/growth equity group, and is the Senior Vice President of Finance and Information Technology at jCyte, Inc., a private biotechnology company dedicated to improving the lives of patients with retinal degenerative diseases. He has held both of these positions since November 2021. From January 2010 until January 2017 Mr. Kuper was also a Partner on the investments team at In-Q-Tel, a non-profit strategic investor that accelerates the development and delivery of technologies to U.S. government agencies. The Board believes that Mr. Kuper’s significant investment and financial expertise make him well qualified to serve as a director on the Board.

ByKristi Marvin