Pivotal Acquisition Corporation

Pivotal Acquisition Corporation

Oct 19, 2020 by Roman Developer


ENTERPRISE VALUE: $806 million

*SPACInsider estimate a/o 12-13-19

Pivotal Acquisition Corp. proposes to merge with KLDiscovery (“KLD”). KLD is a global provider of electronic discovery and information governance services to Fortune 500 companies with an enterprise value of approximately $800 million.

KLD provides software and services that help protect corporations from a range of information governance, compliance and data issues. Its electronic discovery tools and products, including information governance, forensic collections, secure on-line hosting and advanced analytics—all available through its proprietary private cloud based solution called Nebula—can be deployed on the cloud, on premise, or behind a client’s firewall. It is one of only a few providers that can service complex cross-border matters in a manner compliant with data privacy laws.


  • With approximately 54% annually recurring revenue, KLD provides cloud-based services and industry technology for a client base that includes 65% of Fortune 500 companies and 95% of America’s top 100 law firms
  • KLD projects approximately $310 million in revenue and 36% growth in adjusted EBITDA to $75 million for the fiscal year ending 12/31/19
  • KLD majority shareholders The Carlyle Group and Revolution Growth will retain and roll over their shares, which will be subject to a lockup period alongside Pivotal Founders


  • At closing, the current shareholders of KLD will receive an aggregate of 34,800,000 shares of Pivotal common stock.
  • KLD shareholders will also have the right to receive up to 2,200,000 shares of Pivotal common stock if the reported closing sale price of Pivotal’s common stock exceeds $13.50 per share for any 20 consecutive trading days during the five-year period following the closing of the transaction.
  • Condition to closing: Pivotal is required to have at least $175,000,000 available to it from any financing source, including from its trust account and up to $50 million that may come from the forward purchase contract.
  • The transaction is expected to close in the third fourth quarter of 2019

Forward Purchase/Backstop

  • Pivotal Acquisition Corp. (PVT) and MGG entered into a commitment letter where Pivotal may borrow (and MGG will lend) up to $150 million of 5-year convertible notes.
    • The principal amount will be reduced if more than $80 million remains in the trust account after redemptions.
  • Pivotal will have the option to require the Convertible Notes to be converted into shares of Pivotal common stock at the then-current stock price if the last reported sale price of the Pivotal common stock equals or exceeds $18.00 per share for any 20 trading days in a 30 trading-day period.
  • Pivotal may also repay all or a portion of the Convertible Notes (including any paid-in kind interest) at any time without any prepayment penalty.
    • If there is a prepayment, the holders of the Convertible Notes will have the option to purchase shares of Pivotal common stock, at any time prior to the maturity of the Convertible Notes.
    • The price will be equal to the average closing share price for Pivotal common stock for the five trading days prior to the date of the repayment.
    • All principal and accrued but unpaid interest will be due and payable on the fifth anniversary of the consummation of the Business Combination.

Notable Conditions to Closing

  • At least $175,000,000 available to it after payment to holders of Pivotal Class A common stock that seek redemption in connection with the Transactions and net of certain other expenses

Notable Conditions to Termination

  • The Merger Agreement may be terminated by either Pivotal or LD if the Transactions are not consummated on or before November 6, 2019

Founder Shares and Sponsor Private Placement Purchase

  • 5,750,000 Founder Shares at IPO:  none will be forfeited and cancelled at combination
  • 6,350,000 private placement warrants at IPO:  none will be forfeited and cancelled at combination


  • Cannot transfer the founder shares (subject to limited exceptions) until one year after the consummation of an initial business combination or earlier if, subsequent to combination close:
    • The last sales price of Pivotal common stock equals or exceeds $12.00 per share for any 20 trading days within any 30-trading day period commencing at least 150 days after the initial business combination or
    • Pivotal (or any successor entity) consummates a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of Pivotal’s (or such successor entity’s) stockholders having the right to exchange their shares of common stock for cash, securities or other property.
  • Holders of private warrants: agreed not to transfer the private warrants or common stock underlying the private warrants (subject to limited exceptions) until 30 days after the consummation of an initial business combination.
  • In connection with the Merger, the Founder agreed to enter into the Founder Lock-Up Agreement, pursuant to which an aggregate of 1,100,000 founder shares will be subject to additional transfer restrictions until the last sales price of Pivotal common stock equals or exceeds $15.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period.
    • If the last reported sale price of Pivotal common stock does not equal or exceed $15.00 within five years from the consummation of the Business Combination, such founder shares will be forfeited to Pivotal for no consideration.

Pivotal transaction summary 11-19-19


  • Cantor Fitzgerald and BTIG, LLC acted as capital markets and financial advisors to Pivotal.
  • Graubard Miller acted as legal advisor to Pivotal
  • Latham & Watkins LLP acted as legal advisor to KLD


Executive Officers

Jonathan J. Ledecky, 60
Chairman of the Board & Chief Executive Officer

Mr. Ledecky has been a co-owner of the National Hockey League’s New York Islanders franchise since October 2014. He also serves as an Alternate Governor on the Board of Governors of the NHL and as President of NY Hockey Holdings LLC. Mr. Ledecky has served as chairman of Ironbound Partners Fund LLC, a private investment management fund, since March 1999. Mr. Ledecky has also served as President and a director of Newtown Lane Holdings, Incorporated, a blank check company, since October 2015. Mr. Ledecky has served as a member of the board of directors of Propel Media, Inc., a digital media holding company, since January 2015. From July 2005 to December 2007, Mr. Ledecky served as president, secretary and a director of Endeavor Acquisition Corp., a blank check company that completed its initial business combination with American Apparel, Inc. From January 2007 to May 2009, he served as president, secretary and a director of Victory Acquisition Corp., a blank check company that was unable to consummate an initial business combination. He also served as president, secretary and a director of Triplecrown Acquisition Corp., a blank check company, from June 2007 until it completed its initial business combination with Cullen Agricultural Technologies, Inc. in October 2009. During 2007, he also served as president, secretary and director of Grand Slam Acquisition Corp., Performance Acquisition Corp. and Endeavour International Acquisition Corp., three similarly structured blank check companies that never completed their initial public offerings due to market conditions at the time. Mr. Ledecky founded U.S. Office Products in October 1994 and served as its chief executive officer until November 1997 and as its chairman until its sale in June 1998. U.S. Office Products was one of the fastest start-up entrants in the history of the Fortune 500 with sales in excess of $3 billion within its first three years of operation. From 1999 to 2001, Mr. Ledecky was vice chairman of Lincoln Holdings, owners of the Washington sports franchises in the NBA, NHL and WNBA. In addition to the foregoing, Mr. Ledecky served as chairman of the board and chief executive officer of Consolidation Capital Corporation from its formation in February 1997 until March 2000 when it merged with Group Maintenance America Corporation. Mr. Ledecky also has served as a trustee of George Washington University, a director of the U.S. Chamber of Commerce and a commissioner on the National Commission on Entrepreneurship and currently serves as a trustee of the U.S. Olympic Foundation and the U.S. Paralympic Foundation. In 2004, Mr. Ledecky was elected the Chief Marshal of the 2004 Harvard University Commencement, an honor bestowed by his alumni peers for a 25th reunion graduate deemed to have made exceptional contributions to Harvard and the greater society while achieving outstanding professional success. Mr. Ledecky received a B.A. (cum laude) from Harvard University in 1979 and a M.B.A. from the Harvard Business School in 1983.

James H.R. Brady, 54
Chief Financial Officer

Since 2014, Mr. Brady has been the Chief Executive Officer of Brady Enterprises, an advisory firm Mr. Brady founded that provides financial, legal and strategic services to growth companies. From 2013 to 2014, Mr. Brady was the Chief Financial Officer and General Counsel of Sweetgreen, a high-growth healthy, fast casual restaurant chain. From 2011 to 2013, Mr. Brady was Executive Vice President – Finance and Legal for Audax Health Solutions, a digital health/social media company. From 2009 to 2011, he was Executive Counsel of ODIN Technologies, a RFID software company. From 2007 to 2008, he was Chief Financial Officer and General Counsel of VCampus Corporation, a company engaged in the learning/education industry. Mr. Brady previously served as a corporate and securities attorney with the firms of Hogan & Hartson and Hunton & Williams. Mr. Brady received a BA from the College of William and Mary, a JD from the George Washington National Law Center and a MBA from Darden Graduate School of Business at the University of Virginia.


Board of Directors

Kevin Griffin, 42

Mr. Griffin has been designated as a director by Pivotal SPAC Funding LLC pursuant to our amended and restated certificate of incorporation. During Mr. Griffin’s 20-year career, Mr. Griffin has originated and invested over $4 billion across the capital structure of middle market businesses and has also sat on numerous boards of directors. Mr. Griffin founded MGG Investment Group in October 2014 and has served as its Chief Executive Officer and Chief Investment Officer since such time. Prior to launching MGG Investment Group, Mr. Griffin was a Managing Director with Highbridge Principal Strategies from January 2010 to June 2014, where he was a senior member of the Specialty Lending Platform and a Member of the Highbridge Credit Committee. Prior to this, Mr. Griffin was the Head of Private Investing for Octavian Funds, a hedge fund focused on global investing across debt and equity structures, from 2007 to 2009. From 2003 to 2007, Mr. Griffin was part of Fortress Investment Group in charge of originating and underwriting investment opportunities for the Drawbridge Special Opportunities Fund. Prior to Fortress, Mr. Griffin was an investor with one of the first publicly traded business development companies, American Capital, where he was involved in numerous equity buyout and subordinated debt investments. Mr. Griffin began his career with Houlihan Lokey Howard & Zukin’s Investment Banking Division, focusing primarily on distressed M&A and financial restructurings. The M&A Advisor in May 2015 named Mr. Griffin a winner of its 40 Under 40 Emerging Leaders Award. The Hedge Fund Journal, in association with Ernst & Young, in December 2016 named Mr. Griffin one of 50 “Tomorrow’s Titans”. Mr. Griffin received a BSBA in Finance from Georgetown University.

Evan B. Morgan, 34
Independent Director

Since July 2016, Mr. Morgan has served as Manager of The Radcliff Companies (“Radcliff”), a New York-based private investment partnership backed by twenty global family offices. Radcliff invests across the capital structure seeking long-term compounding at high rates of return primarily in privately held consumer and services businesses. From 2011 until he joined Radcliff in 2016, Mr. Morgan was a Partner at Revolution Growth, a Washington D.C. based private equity firm which invests in and actively helps build disruptive, innovative, and significant new consumer companies. From 2009 to 2011, Mr. Morgan was with the Carlyle Group, a global alternative asset manager based in Washington, D.C. Mr. Morgan is a member of the board of directors of KLDiscovery, JetLinx Global and SportRadar US. Mr. Morgan received a B.A. from the University of Pennsylvania.

Efrat Epstein, 35

Ms. Epstein has held leadership positions across media, tech and financial services. Since November 2016, Ms. Epstein has been the Managing Partner of Sound Ventures, an LA-based venture capital fund founded by Ashton Kutcher and Guy Oseary. In this role, Ms. Epstein leads investing, strategy and the day-to-day management of the fund. From January 2016 to November 2016, Ms. Epstein led Global Strategy at Marsh, a multi-billion dollar division of financial services firm Marsh & McLennan (NYSE: MMC). From October 2013 to January 2016, Ms. Epstein was Senior Vice President of Planning and Head of Investor Relations at iHeartMedia, a global entertainment company, and from May 2011 to September 2013, she was Head of Business Development and Strategy at CLEAR, a privately held technology company. Earlier in her career, Ms. Epstein was part of Merrill Lynch’s Global Energy and Power Investment Banking group as well as the Global Strategy team at NYSE Euronext. Ms. Epstein received a BA from the University of Texas in Austin and an MBA from Harvard Business School.

Katrina Adams, 50

Ms. Adams is the Chairman of the Board and President of the United States Tennis Association, a position she assumed in January 2015. In this role, she also serves as Chairman of the US Open. Ms. Adams is the first African-American, first former professional tennis player and youngest person to serve as President in the organization’s 135-year history. She is also the first individual to serve a second two-year term as Chairman of the Board and President. In 2015, Ms. Adams was elected Vice President of the International Tennis Federation and in 2016, she was appointed Chairman of the Fed Cup Committee, which governs the Fed Cup, the largest annual international team competition in women’s sport. She also serves on the board of directors for the International Tennis Hall of Fame. An accomplished tennis professional, Ms. Adams played for 12 years on the Women’s Tennis Association tour, where she ranked as high as No. 67 in the world in singles and No. 8 in doubles, winning 20 career doubles titles and reaching the quarterfinals or better in doubles at all four Grand Slam events. While an active pro, Ms. Adams served on the board of directors of the Women’s Tennis Association as a player representative for four one-year terms and on the Women’s Tennis Association’s Players Association for five two-year terms. After leaving the tour, Ms. Adams was a USTA National Tennis Coach from 1999 to 2002. She also joined the USTA’s Board of Directors in 2005, serving as a Director at Large and as the association’s Vice President and First Vice President before assuming the presidency. She was named the Intercollegiate Tennis Association (ITA) Rookie of the Year in 1986 and an NCAA All-American in 1986 and 1987. She also became the first African-American to win the NCAA doubles title in 1987. Among her many accolades, Ms. Adams was honored with the WTA’s Player Service Award in 1989, 1996 and 1997, and she received the WTA Althea Gibson Award in 2003. In addition, she was inducted into the Northwestern Hall of Fame in 1998, the USTA Midwest Section Hall of Fame in 2005, the Chicago District Tennis Hall of Fame in 2008, the Black Tennis Hall of Fame in 2012, the ITA Women’s Tennis Hall of Fame in 2014 and the USTA Eastern Section Tennis Hall of Fame in 2015. She was also named one of the “25 Influential Black Women in Business” by The Network Journal and as one of Sports Business Daily’s “Game Changers” in 2015. In 2016, she was inducted into the Boys & Girls Clubs of America Alumni Hall of Fame. In addition to her duties with the USTA, Ms. Adams is a contributor on CBS Sports Network’s first all-female sports show, “We Need to Talk.” She also serves as a television analyst for Tennis Channel and as a contributor to Tennis magazine and tennis.com, providing instructional articles and videos. Moreover, since 2005, Ms. Adams has served as the Executive Director of the Harlem Junior Tennis and Education Program, a National Junior Tennis & Learning network (NJTL) chapter based in New York City. Ms. Adams attended Northwestern University, majoring in communications, before deciding to leave school and focus on her professional tennis career.