Montes Archimedes Acquisition Corporation

Montes Archimedes Acquisition Corporation

Oct 19, 2020 by Roman Developer

PROPOSED BUSINESS COMBINATION: Roivant Sciences

ENTERPRISE VALUE: $5.0 billion
ANTICIPATED SYMBOL: ROIV

Montes Archimedes Acquisition Corporation proposes to combine with Roivant Sciences, a biopharmaceutical and healthcare technology company.

Since its founding in 2014, Roivant has put over 40 medicines into development across a wide range of disease areas. Companies built by Roivant have conducted eight consecutive positive Phase 3 studies with two FDA approvals to date. Roivant is also a leader in computational drug discovery through its combination of computational physics and machine learning-based platforms for the in silico design of small molecules. Roivant has over 800 employees across its family of companies today.


WARRANT REDEMPTION – 8/17/23 – LINK

  • On Aug 2, 2023, Roivant will redeem all outstanding Warrants for Common Shares per Sept 30, 2021 Agreement with Equiniti Trust Company remaining after 5:00 p.m. NYC Time on Sep 1, 2023.
    • Price: $0.10/Warrant.
    • Roivant instructs Warrant Agent to notify holders of Redemption Fair Market Value: $11.35.
    • Opting for “cashless” exercise pre-Redemption Date yields ~0.2495 Common Shares/Warrant.

SUBSEQUENT EVENTS – 8-K 10/1/21

  • On September 30, 2021, Roivant, MAAC, Patient Square Capital LLC, a Delaware limited liability company and the other parties thereto entered into an amendment to the Sponsor Support Agreement, dated as of May 1, 2021, as amended by Amendment No. 1 thereto, dated as of June 9, 2021 (as amended, the “Sponsor Support Agreement”)
    • (i) amend and specify the number of Common Shares that constitute “20% Earn-Out Shares,” “10% Earn-Out Shares” and “Retained Shares” for purposes of the Sponsor Support Agreement
    • (ii) amend the commencement date of the time period during which the Earn-Out Shares may vest and become free of the restrictions set forth in Section 2(b) of the Sponsor Support Agreement.
  • (a) Subject to, and conditioned upon the occurrence of and effective immediately after the Effective Time
    • (i)  the number of Company Post-Closing Common Shares issued to the MAAC Sponsor, any Affiliate of the MAAC Sponsor, each MAAC Independent Director or any MAAC Independent Director Transferee upon the conversion of MAAC Class B Shares held by him, her or it immediately prior to the Effective Time (rounded up to the nearest whole share) set forth in the table below under the heading “20% Earn-Out Shares” shall be subject to the provisions set forth below in this Section 2 (such Company Post-Closing Common Shares, the “20% Earn-Out Shares”)
    • (ii) the number of Company Post-Closing Common Shares issued to the MAAC Sponsor, any Affiliate of the MAAC Sponsor, each MAAC Independent Director or any MAAC Independent Director Transferee upon the conversion of MAAC Class B Shares held by him, her or it immediately prior to the Effective Time (rounded up to the nearest whole share) set forth in the table below under the heading “10% Earn-Out Shares” shall be subject to the provisions set forth below in this Section 2 (such Company Post-Closing Common Shares, the “10% Earn-Out Shares” and, together with the 20% Earn-Out Shares, the “Earn-Out Shares”)
    • (iii) the remaining number of Company Post-Closing Common Shares issued to the MAAC Sponsor, any Affiliate of the MAAC Sponsor, each MAAC Independent Director or any MAAC Independent Director Transferee upon the conversion of MAAC Class B Shares held by him, her or it immediately prior to the Effective Time (rounded down to the nearest whole share) set forth in the table below under the heading “Retained Shares” shall not be subject to the provisions set forth below in this Section 2 (such Company Post-Closing Common Shares, the “Retained Shares”).
  • (b) Subject to, and conditioned upon the occurrence of and effective immediately after the Effective Time, the Earn-Out Shares shall be unvested and subject to the restrictions and forfeiture provisions set forth in this Section 2. The Earn-Out Shares shall vest and become free of the provisions set forth in this Section 2 at such time as the Stock Price of Company Post-Closing Common Shares equals or exceeds
    • (x) with respect to the 20% Earn-Out Shares, $15.00 per share (the “20% Trigger Price”)
    • (y) with respect to the 10% Earn-Out Shares, $20.00 per share (the “10% Trigger Price” and, together with the 20% Trigger Price, the “Trigger Price”), in each case, for any 20 Trading Days within any 30 Trading Day period commencing on the earlier of
      • (i) the date on which the registration statement on Form S-1 required to be filed by the Company in connection with the PIPE Financing (as defined in the Business Combination Agreement) is declared effective by the U.S. Securities and Exchange Commission
      • (ii) November 15, 2021, and ending no later than the fifth (5th) anniversary of the Closing Date (the “Earn-Out End Date”); providedhowever
        • (i) if the Earn-Out End Date occurs on a day that is not a Trading Day, then the Earn-Out End Date shall be deemed to occur on the next following Trading Day
        • (ii) if the Company or any of its Affiliates enters into a definitive agreement with respect to a Sale on or prior to the Earn-Out End Date, then the Earn-Out End Date shall be automatically extended and shall be deemed to occur on the earlier of
          • (A) the day after such Sale is consummated
          • (B) the termination of such definitive agreement with respect to such Sale in accordance with its terms. Any Earn-Out Shares that have not vested in accordance with this Section 2(b) or Section 2(c) on or before the Earn-Out End Date will be immediately forfeited at 11:59 p.m., New York, New York time on the Earn-Out End Date.

SUBSEQUENT EVENTS – 8-K 6/21/21

  • On June 18, 2021, Montes Archimedes Acquisition Corp. (“MAAC”), Roivant Sciences Ltd. (“Roivant”) and an affiliate of SK Inc. (the “Investor”) entered into a subscription agreement (the “Subscription Agreement”), pursuant to which the Investor agreed to subscribe for 2,000,000 shares of MAAC Class A common stock at a purchase price of $10.00 per share, for gross proceeds of $20,000,000 (the “Additional PIPE Financing”).
  • Such shares of MAAC Class A common stock will be converted into common shares of Roivant in connection with the Closing.

TRANSACTION

  • In this all-primary transaction, current holders of Roivant shares and equity awards will maintain their existing equity interests in Roivant.
  • Current shareholders and warrant holders of MAAC will convert their shares and warrants of MAAC into common shares and warrants of Roivant on a one-for-one basis. Assuming a share price of $10.00 per share and no redemptions of MAAC shares, Roivant is expected to have an initial market capitalization of $7.3 billion inclusive of its pro forma net cash balance of approximately $2.3 billion.
    • The MAAC Sponsor Exchange Ratio is 1.0, subject to reduction in an amount equal to one-half of the percentage of shares of MAAC Class A common stock redeemed in connection with the Business Combination (i.e., if 10% of the shares of MAAC Class A common stock are so redeemed, then the MAAC Sponsor Exchange Ratio will be equal to 0.95), provided that in no event will the MAAC Sponsor Exchange Ratio be less than 0.75.
  • Roivant is expected to have an initial market capitalization of $7.3 billion inclusive of its pro forma net cash balance of approximately $2.3 billion.
  • Assuming no redemptions of MAAC shares, current shareholders of Roivant will own approximately 92% of Roivant immediately post-closing (including shares issued in connection with Roivant’s recent acquisition of Silicon Therapeutics and existing Roivant shareholder participation in the PIPE).
  • The transaction is expected to deliver up to $611 million of gross proceeds to fund discovery and development programs.
    • This includes up to $411 million currently held in MAAC’s trust account, as well as a concurrent $200 million common stock private investment in public equity (“PIPE”) priced at $10.00 per share.
    • New institutional and strategic investors and existing Roivant shareholders have committed to participate in the PIPE, including Fidelity Management & Research Company LLC, Eventide Asset Management, Suvretta Capital, Palantir Technologies, RTW Investments, LP, Viking Global Investors, Sumitomo Dainippon Pharma, and SB Management, a subsidiary of SoftBank Group Corp.
  • Proceeds are expected to extend the company’s operating runway through mid-2024.

MAAC trans overview


PIPE

  • An aggregate of 20,000,000 shares of MAAC Class A common stock at a purchase price of $10.00 per share, for aggregate gross proceeds of $200,000,000
  • New institutional and strategic investors and existing Roivant shareholders have committed to participate in the PIPE, including Fidelity Management & Research Company LLC, Eventide Asset Management, Suvretta Capital, Palantir Technologies, RTW Investments, LP, Viking Global Investors, Sumitomo Dainippon Pharma, and SB Management, a subsidiary of SoftBank Group Corp.

EARNOUT

  • Twenty percent of the Roivant Common Shares issued to the MAAC Sponsor in respect of its shares of MAAC Class B common stock will be subject to the vesting conditions, (the “$15 Earn-Out Shares”)
    • The $15 Earn-Out Shares will vest if the closing price of the Roivant Common Shares is greater than or equal to $15.00 over any twenty out of thirty trading day period during the five year period following the Closing
  • ten percent of the Roivant Common Shares issued to the MAAC Sponsor in respect of its shares of MAAC Class B common stock will be subject to the vesting conditions, (the “$20 Earn-Out Shares”)
    • The $20 Earn-Out Shares will vest if the closing price of the Roivant Common Shares is greater than or equal to $20.00 over any twenty out of thirty trading day period during the five year period following the Closing.

LOCKUP

  • The MAAC Sponsor and such Roivant equityholders have agreed not to effect any sale or distribution of the Roivant Common Shares (including those underlying incentive equity awards) held by such equityholders as of immediately following the Closing during the applicable lock-up period.
  • The lock-up period applicable to Roivant Common Shares held by the MAAC Sponsor will be
    • (i) with respect to 25% of the Roivant Common Shares held by the MAAC Sponsor, six months following the Closing
    • (ii) with respect to an additional 25% of the Roivant Common Shares held by the MAAC Sponsor, the earlier of twelve months following the achievement of certain price-based vesting restrictions or six years from the Closing and
    • (iii) with respect to 50% of the Roivant Common Shares held by the MAAC Sponsor, thirty-six months following the Closing.
  • The Roivant warrants and the Roivant Common Shares underlying warrants held by the MAAC Sponsor will be subject to a corresponding lock-up period for
    • (i) with respect to 25% of such warrants held by the MAAC Sponsor, six months from the Closing
    • (ii) with respect to an additional 25% of such warrants held by the MAAC Sponsor, twelve months from Closing and
    • (iii) with respect to 50% of such warrants held by the MAAC Sponsor, thirty-six months from the Closing.
  • The lock-up period applicable to Roivant Common Shares (including those underlying incentive equity awards) held by certain Roivant equityholders will be
    • (i) with respect to 25% of the Roivant Common Shares (including those underlying incentive equity awards) held by such Roivant equityholders, six months following the Closing
    • (ii) with respect to an additional of the Roivant Common Shares (including those underlying incentive equity awards) held by such Roivant equityholders, twelve months following the Closing and
    • (iii) with respect to 50% of the Roivant Common Shares (including those underlying incentive equity awards) held by such Roivant equityholders, thirty-six months following the Closing.

NOTABLE CONDITIONS TO CLOSING

  • The aggregate cash proceeds from MAAC’s trust account being no less than $210,000,000 (after deducting any amounts paid to MAAC stockholders that exercise their redemption rights in connection with the Business Combination)

NOTABLE CONDITIONS TO TERMINATION

  • By either MAAC or Roivant, if the Business Combination is not consummated by November 30, 2021

ADVISORS

  • J.P. Morgan Securities LLC is serving as a financial advisor and capital markets advisor to Roivant and as a lead placement agent for the PIPE.
  • SVB Leerink LLC is serving as a capital markets advisor to Roivant and as a lead placement agent for the PIPE.
  • Goldman Sachs & Co. LLC is serving as a financial advisor to Roivant.
  • Cowen and Company, LLC is serving as a financial advisor and capital markets advisor to Roivant.
  • Citigroup Global Markets Inc. is serving as a placement agent for the PIPE.
  • Truist Securities, Inc. is serving as a capital markets advisor to Roivant and as a placement agent for the PIPE.
  • Davis Polk & Wardwell LLP is acting as legal counsel to Roivant.
  • Kirkland & Ellis LLP is acting as legal counsel to MAAC.

MANAGEMENT & BOARD


Executive Officers

James C. Momtazee, 48
Chief Executive Officer and Director

Mr. Momtazee initially joined KKR & Co., Inc., or KKR, in 1996. He helped form the health care industry group in 2001 and was promoted to Head of the Heath Care Team for the Americas Private Equity platform in January 2009. He was a member of KKR’s Americas Private Equity Investment Committee and was Chairman of the Health Care Strategic Growth and the Health Care Royalty & Income Investment Committees. During the period between 2001 and 2019, KKR was one of the most active investors on Wall Street, committing over $50 billion in capital, across the health care sector. The largest of these investments was its $33 billion acquisition of HCA, Inc. in 2006, which at the time, was the largest cash buyout in history. During this same period, KKR made several other notable investments across the health care sector, including: Jazz Pharmaceuticals plc in 2004, PRA Health Sciences, Inc. in 2013, and BridgeBio Pharma, Inc. in 2016. Mr. Momtazee currently serves on the Board of Directors of BridgeBio, PRA Health Sciences (lead independent director), and the Medical Device Manufacturers Association and has previously served on the Board of Directors of multiple other health care companies including Envision Healthcare, Heartland Dental, Ajax Health, Global Medical Response, BrightSpring Health Services, Covenant Surgical Partners, Entellus Medical, Inc. (acquired by Stryker Corporation), EchoNous, Spirox, Inc., Arbor Pharmaceuticals, Lake Region Medical, HCA Healthcare, Jazz Pharmaceuticals, and Alliance Imaging.


Maria C. Walker, 55
Chief Financial Officer

Most recently, Ms. Walker co-founded, and served as Chief Executive Officer of, Recuerdo Therapeutics, a biotechnology startup that focused on the postponement of Alzheimer’s disease. Prior to her time with Recuerdo, Ms. Walker spent the majority of her career with KPMG where, over two separate periods between 1993 to 2000 and 2008 to 2018, she advanced to the role of senior partner and served as global lead partner of private equity leading a global, cross-functional team of 70+ partners advising a bulge bracket private equity firm. During the time period between 2000 and 2005, Ms. Walker served as the Administrative Partner, Chief Operating Officer and Chief Financial Officer for Forward Ventures, and between 2005 and 2008, she served as the Chief Financial Officer of Lightspeed Venture Partners, where she was a key member of the team establishing units in India, China and Israel. At KPMG and as an investment executive, Ms. Walker advised over a dozen public companies on operations, financial reporting, debt and equity offerings, mergers and acquisitions, take public and take private transactions. Ms. Walker currently serves on the Board of Directors of ForgeRock, Inc., a private cyber security company where she also serves as the audit committee Chairman, the Boys and Girls Club of Greater Tarrant County, and StepUp. Ms. Walker has previously served on the Board of Director of the KPMG Foundation Board of Trustees and MedicineNet (acquired by WebMD).


 

Board of Directors

George Barrett, 65
Director nominee

George Barrett is the former chairman and chief executive officer of Cardinal Health, Inc., a role he held from August 2009 through end of 2017, when he became executive chairman of the board until November 2018. He helped transform Cardinal Health into a global, integrated health care company, delivering 189% total shareholder return during his eight-year CEO tenure from August 2009 to December 2017. Prior to joining Cardinal Health, Mr. Barrett spent a decade at global pharmaceutical manufacturer Teva Pharmaceutical Industries Ltd., most recently as president and CEO of its North American business and corporate executive vice president for Global Pharmaceuticals. Mr. Barrett serves on the boards of Target Corporation, Olive, a health carefocused artificial intelligence company, and on the advisory board of InStride, a public-benefit corporation that provides workforce education. Additionally, Barrett serves on the boards of Nationwide Children’s Hospital and the Children’s Hospitals’ Solutions for Patient Safety, and the National Academy of Medicine’s President’s Advisory Council on Healthy Longevity. He is vice chair of the board of trustees of The Conference Board, and a former director of the Federal Reserve Bank of Cleveland. Barrett earned his bachelor’s degree from Brown University, and his MBA from New York University. Barrett is an Adjunct Assistant Professor at Columbia University Mailman School of Public Health, a trustee emeritus of Brown University, and a frequent lecturer at other leading American universities on the topics of leadership and health care.


Steve Oesterle, 69
Director nominee

Dr. Stephen Oesterle currently serves as a consultant to several private equity and venture capital groups and numerous public operating companies in the health care industry. Previously, Dr. Oesterle served as Medtronic’s Senior Vice President for Medicine and Technology and was a member of the Medtronic Executive Committee for 14 years. By forging relationships with global technology partners and technical universities, he oversaw long term internal technology investments while participating in strategic corporate investments in emerging private companies. He also served as a member of the Business Development and Strategy Committee that approved all corporate acquisitions. During his tenure at Medtronic Dr. Oesterle served on more than 20 boards as a director or observer and built a strong and enduring profile for Medtronic in the global venture capital and private equity communities. Prior to joining Medtronic, he was an associate professor at Harvard Medical School and practicing interventional cardiologist. Dr. Oesterle currently serves on the boards of two public companies, Baxter (NYSE: BAX), and Peijia Medical (HKG: 9996) in addition to the board of certain private companies. Dr. Oesterle graduated summa cum laude from Harvard and received his medical degree from Yale; he completed his internship and residency at Massachusetts General Hospital. Following medical school, he completed a fellowship in Interventional Cardiology at Stanford and then served on the faculty at Stanford and Harvard Medical Schools and directed the Invasive Cardiology Services at Massachusetts General Hospital and Stanford.