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Sizzle Acquisition Corp. *

Sizzle Acquisition Corp. *

Mar 11, 2021 by Kristi Marvin

PROPOSED BUSINESS COMBINATION: Critical Metals Corp.

ENTERPRISE VALUE: $838 million
ANTICIPATED SYMBOL: CRML

Sizzle Acquisition Corp. proposes to combine with Critical Metals Corp.

Upon closing of the business combination, Critical Metals will own European Lithium’s Wolfsberg Lithium Project (the “Project”), which is currently owned by European Lithium’s wholly owned subsidiary, European Lithium AT (Investments) Limited, as well as a 20% interest in additional Austrian projects currently held by European Lithium. European Lithium will be the largest shareholder of Critical Metals and is expected to continue to trade on the Australian Securities Exchange (“ASX”). The board of Critical Metals is expected to comprise a total of 5 members, 4 of whom will be nominees of European Lithium and 1 of whom will be a nominee of Sizzle.

EXTENSION – 2/12/24 – LINK

  • The SPAC approved the extension from February 8, 2024 to August 8, 2024.
    • 779,917 shares were redeemed for $11.05 per share.
    • $30K per month will be deposited into the trust account.

SUBSEQUENT EVENT – 2/8/24 – LINK

  • On February 8, 2024, Sizzle, Pubco, and VO Sponsor, LLC entered into subscription agreements with three affiliated PIPE Investors for a PIPE Financing, where the investors will buy 1,000,000 ordinary shares of Critical Metals at $10 per share, totaling $10 million.
    • The investors can offset this by purchasing Sizzle’s public shares on the open market, with Pubco compensating the difference at the business combination’s closing.
    • Additionally, the Sponsor will transfer 2,049,000 Sizzle founder shares to the PIPE Investors without extra cost.
    • At closing, Critical Metals will issue 1,000,000 Pubco Shares, warrants for another 1,000,000 shares, and 3,000,000 additional shares, subject to conditions and transfer restrictions.
    • Post-closing, all Pubco Share holders, except PIPE Investors and Sizzle’s public shareholders, will face a one-year lock-up, and Critical Metals is barred from issuing more shares or SEC filings for 60 days, with some exceptions.

Termination of Equity Forward Agreement

  • Sizzle previously reported that it and Critical Metals entered an Equity Forward Agreement with Vellar for the purchase of up to 20 million Pubco Shares for $10 million, with a break-up fee involving costs, $200,000, and 200,000 shares.
    • On February 8, 2024, they agreed to terminate this agreement and notified Vellar.

SUBSEQUENT EVENT – 10/27/23 – LINK

  • On October 25, 2023, Sizzle and Pubco signed a binding term sheet with Vellar Opportunities Fund Master, LTD. regarding a potential investment of up to 20 million shares in Sizzle Common Stock and/or Pubco Ordinary Shares.
  • According to the Term Sheet, the Investor has the option, but not the obligation, to purchase Recycled Shares of Sizzle Common Stock from third parties (excluding Sizzle) through a broker in the open market (excluding through Sizzle) before the Business Combination closes.
    • The purchase price for Recycled Shares will not exceed the Initial Price determined per Sizzle’s certificate of incorporation.
    • Regarding these Recycled Shares, the Investor agrees to
      • (i) waive any redemption rights under Sizzle’s certificate of incorporation related to them in connection with the Business Combination and
      • (ii) refrain from voting these Recycled Shares during the Proposed Business Combination.
    • After the Proposed Business Combination closes, Pubco will pay the Investor directly from Sizzle’s trust account an amount equal to
      • (i) the number of Recycled Shares bought by the Investor, multiplied by (ii) the Initial Price, as specified in the Term Sheet.
  • This issuance will be adjusted to subtract any Recycled Shares purchased by the Investor.
    • This exchange will take place in return for the Investor’s cash investment in Pubco as outlined in the Term Sheet, involving a series of payments.
    • Initially, an aggregate payment of $10 million will be made at the Proposed Business Combination’s closing, minus the amount funded under the Prepayment Forward Amount, referred to as the “Funding Election Amount.”
    • Pubco may receive further payments either through an optional early settlement notice from the Investor or via a cash settlement after the Valuation Period, as defined in the Term Sheet.
  • Pubco is obligated to pay the Investor a Termination Fee if the Proposed Investment is terminated by Sizzle and the Proposed Business Combination closes.
    • This fee includes reasonable expenses (up to $50,000), $200,000 in cash, and 200,000 Pubco Ordinary Shares.
    • The Termination Fee is not payable if the Business Combination is terminated according to the terms of the Merger Agreement.

EXTENSION – 8/11/23 – LINK

  • The SPAC approved the extension from August 8, 2023 to February 8, 2024.
    • 1,337,244 shares were redeemed for $10.85 per share.
    • $60K per month will be deposited into the trust account.

SUBSEQUENT EVENT – 7/7/23 – LINK

On July 7, 2023, Sizzle, EUR, the Company, Critical Metals, and Merger Sub amended their Agreement and Plan of Merger via the Second Amendment.

  • The Outside Date has been set for the earlier of two conditions: either the final date set in Sizzle’s organizational documents for the business combination or September 8, 2023.
  • Removed the requirement for Sizzle or Pubco to have a minimum of $5,000,001 in net tangible assets for the merger to go through, unless Sizzle’s stockholders vote to keep this requirement in the organization’s documents.
  • Sizzle must prepare and file a proxy statement with the SEC by July 14, 2023, seeking approval from its stockholders to extend the deadline for the initial business combination.

EXTENSION – 2/2/23 – LINK

  • The Sponsor will extend the date by which it must consummate a business combination from February 8, 2023 to August 8, 2023.
    • 11,076,703 shares were redeemed at the meeting.
    • The Company will deposit an aggregate amount of $200,000 into the trust account, which enables it to extend to March 8, 2023, and will deposit the same amount each additional month that is needed until August 8, 2023.

TRANSACTION

  • The Proposed Transaction values the combined entity at an implied pro forma enterprise value of approximately $838 million, and at an implied pro forma market capitalization of approximately $972 million.
  • The implied pre-money equity value is $750 million.
  • The transaction is expected to provide approximately $159 million in capital before transaction expenses and the impact of redemptions by the public stockholders of Sizzle.
  • European Lithium will roll 100% of its existing equity in European Lithium AT (Investments) Limited into the combined entity, retaining approximately 80% of the combined company’s pro forma equity before the impact of redemptions or any additional capital raised.
  • It is currently expected that the transaction will close in the first half of 2023.

SZZL

PIPE

  • On February 8, 2024, Sizzle, Pubco, and VO Sponsor, LLC entered into subscription agreements with three affiliated PIPE Investors for a PIPE Financing, where the investors will buy 1,000,000 ordinary shares of Critical Metals at $10 per share, totaling $10 million.
    • The investors can offset this by purchasing Sizzle’s public shares on the open market, with Pubco compensating the difference at the business combination’s closing.
    • Additionally, the Sponsor will transfer 2,049,000 Sizzle founder shares to the PIPE Investors without extra cost.
    • At closing, Critical Metals will issue 1,000,000 Pubco Shares, warrants for another 1,000,000 shares, and 3,000,000 additional shares, subject to conditions and transfer restrictions.

EARNOUT

  • EUR will also have a contingent right to receive up to an additional number of PubCo Shares equal to 10% of the Closing Share Consideration after the Closing based on the stock price performance of the PubCo Shares during the five-year period following the Closing (the “Earnout Period”).
    • In the event that, during the Earnout Period, the VWAP per PubCo Share is greater than or equal to $15.00 (the “First Earnout Milestone Price”) for any twenty trading days within any thirty trading day period during the Earnout Period, PubCo will issue to EUR an additional number of PubCo Shares equal to 5% of the Closing Share Consideration (“First Level Contingent Share Consideration”).
    • Further, in the event that the VWAP per PubCo Share is greater than or equal to $20.00 (the “Second Earnout Milestone Price”) for any 20 trading days within any 30 trading day period during the Earnout Period, PubCo will issue to EUR an additional number of PubCo Shares equal to 5% of the Closing Share Consideration (“Second Level Contingent Share Consideration”).

LOCK-UP

Sponsor:

  • The Sponsor and EUR agreed not to transfer any Lock-up Shares it holds during the Lock-up Period of 6 months after the Closing Date.

Company

  • Post-closing, all Pubco Share holders will face a one-year lock-up, and Critical Metals is barred from issuing more shares or SEC filings for 60 days, with some exceptions.

NOTABLE CONDITIONS TO CLOSING

  • The Merger Agreement contains customary conditions to Closing including SPAC having at least $40,000,000 in funds in the trust account, together with the cash on SPAC’s balance sheet and the aggregate amount of gross proceeds from any Future PIPE Investment, after giving effect to the completion and payment of any redemptions and before payment of Transaction Expenses.

NOTABLE CONDITIONS TO TERMINATION

  • The Merger Agreement may be terminated at any time prior to the Closing by either SPAC or the Company if Closing has not occurred by February 8, 2023 (the “Outside Date”), provided that SPAC may extend the Outside Date for an additional period ending on the earlier of:
    • (A) the last date for SPAC to consummate its Business Combination pursuant to an extension granted pursuant to SPAC’s organizational documents and
    • (B) May 8, 2023

[Outside date amended to September 8, 2023]

  • If EUR either changes its board recommendation or enters into a superior proposal and either SPAC or EUR terminates the Merger Agreement, SPAC will be entitled to a break-up fee of $5,000,000 as the sole and exclusive monetary remedy in the circumstances in which the break-up fee is payable.
  • If the SPAC changes its board recommendation and the Company terminates the Merger Agreement, the Company will be entitled to a break-up fee of $5,000,000 as the sole and exclusive monetary remedy in the circumstances in which the break-up fee is payable.

ADVISORS

  • Jett Capital Advisors, LLC is acting as exclusive financial advisor to European Lithium
  • White & Case LLP is acting as U.S. legal advisor to European Lithium.
  • Cohen & Company Capital Markets, a division of J.V.B. Financial Group, LLC, is acting as exclusive financial advisor and exclusive capital markets advisor to Sizzle
  • Ellenoff, Grossman & Schole LLP is acting as legal advisor to Sizzle.

MANAGEMENT & BOARD

Executive Officers

Steve Salis, 37
Chairman of the Board of Directors and Chief Executive Officer

Mr. Salis serves as the CEO of Salis Holdings, LLC, a company he founded in 2015. Salis Holdings, LLC is a privately-held multi-brand, multi-platform holding company, which owns restaurants and hospitality assets in Washington D.C. and acquires brands with a high price and value correlation for sale through multiple distribution channels. Prior to founding Salis Holdings, Mr. Salis co-founded &pizza in July 2011, a fast casual pizza brand which delivers individual pizzas cooked within 90 seconds, and served as its CEO from July 2011 to March 2015. As CEO, he assembled successful leadership teams, implemented business and personnel evaluation tools and communicated on a regular basis with the investment community. Additionally, since November 2016 he has served as the Chairman, President, and owner of Kramerbooks, a 44 year old bookstore in Washington D.C. and is an investor in Prefab Partners since January 2016. Prior to &pizza, Mr. Salis nurtured his entrepreneurial spirit in New York City where he worked in the restaurant and hospitality space learning the business from the ground up, working with acclaimed operators, including how to evaluate key operating and acquisition metrics for restaurant and hospitality companies. Mr. Salis attended the University of New Hampshire from 2002-2004 where he studied Economics and Business Administration.

Nestor Nova, 41
Chief Financial Officer

Mr. Nova has been the Chief Financial Officer since September 2021. From December 2014 to September 2021, Mr. Nova served as Chief Financial Officer of Nando’s Restaurant Group, where he led the growth and transformation of the North American organization and franchise locations of Nandos Peri Peri Chicken. From September 2013 to December 2014, Mr. Nova was the Finance Director Operations, Strategy and Business Development at Margaritaville, Landshark Hospitality, where he was responsible for the implementation of a company-wide data warehouse and business intelligence tools. Additionally, from November 2010 until September 2013, Mr. Nova was the Director of Finance and Accounting at Earl Enterprises, which owns restaurants such as Buca di Beppo, Planet Hollywood, Earl of Sandwich, among others. Prior to this, Mr. Nova served in multiple finance roles for Universal Studios and Ginn Resorts. Mr. Nova holds a B.A. in Economics from the University of Central Florida and a Masters degree in Business Administration from Regents College.

Daniel Lee, 41
Head of Business Development

Since May 2018, Mr. Lee has been SVP of Business Development at Salis Holdings LLC, where he works on potential acquisitions and financings for the company. Since December 2016, Mr. Lee has been a Managing Partner at Candlelight Capital Advisors, LLC, an advisory and consulting firm providing outsourced business strategy and corporate development services for media, technology and consumer companies. Mr. Lee served as the CFO of RiskSpan, Inc. from December 2017 to April 2019 and previously as the Director of Finance from December 2016 to November 2017. At RiskSpan, Inc. he lead corporate finance functions, including business planning and budgeting, financial forecasting, cash flow management, and reporting for senior leadership and private equity investors. From October 2016 to August 2016, Mr. Lee was a partner at an early-stage venture firm in Washington D.C., NextGen Venture Partners, LLC which focused on technology-enabled startups. Before NextGen, Mr. Lee was an Equity Analyst at Profit Investment Management from November 2011 to December 2012, before becoming a Senior Equity Analyst in December 2012 where he was responsible for identifying, analyzing and recommending new investment ideas for the financial, financial technology and industrial sectors, until September 2015. Mr. Lee received a B.A. in Economics from the University of Virginia.

Board of Directors

Jamie Karson, 63
Non-Executive Vice-Chairman of the Board of Directors

Mr. Karson has served as Executive Chairman of Salis Holdings since June 2018, a multi-brand, multi-platform holding company. Mr. Karson and Mr. Salis work closely together on a day to day basis. Mr. Karson assists in analyzing operating performance while working with the team, on all aspects of the business, including analyzing potential acquisitions and strategic partnerships. This includes negotiating strategic initiatives with funding sources such as private equity partners, family officers, and commercial banks. From 2001 to May 2008, Mr. Karson was the CEO and Chairman of the Board of Steve Madden, where he partnered with the executive team, developing and acquiring new brands and new channels of distribution, making retail store openings and closing decisions, managing shareholder communications and relationships, and oversight. Additionally, from January 2009 to January 2014, he was the CEO and COO of Think Pink, LLC which operated 5 QSR Pinkberry restaurants in Connecticut where his responsibilities including all hiring and firing, making all real estate decisions, financial modeling and negotiation of the sale of the Company. From August 2015 to September 2017, Mr. Karson served as the CEO and Chairman of the Board of Original Soupman (QTCQV:SOUP) where he increased annual revenues and cut monthly loses by establishing distribution in key supermarket chains around the country including Kroger, Publix, ShopRite, Wegmans, Stop & Shop, and Costco. From October 2017 to June 2018, Mr. Karson served as an independent consultant. Mr. Karson received a B.A. in Political Science from the University of North Carolina, Chapel Hill and his J.D. from New York Law School.

David Perlin, 58
Director Nominee

Currently, Mr. Perlin is a Senior VP at Shepherd Kaplan Krochuk, LLC, a RIA based in Boston, serving as an investment advisor, where he began in January 2020. From April 2016 to December 2019, he was the CEO of Pearl Investment Partners, a multi-family office investment firm and RIA, which he founded in 2016. Prior thereto, from April 2013 he was SVP and a Managing Director at Goldman Sachs, in the private wealth management division. Additionally, Mr. Perlin currently serves as the Vice Chairman of the Board of Teach for America in the D.C. Region. Mr. Perlin received a B.S. in Accounting from New York University and an M.B.A. from New York University, Stern School of Business.

Karen Kelley, 55
Director Nominee

Currently, she is the COO of Jack’s Family Restaurants, a 200+ unit southern American fast casual chain based in Birmingham, Alabama. As COO since May 2020, she is responsible for all aspects of operations including human resources and field operations leadership. She also is responsible for centralized operation support such as training and supply chain. Prior to Jack’s, she served as the COO of Panera Bread from December 2018 to May 2020, responsible for operations of over 2,000 restaurants with full profit and loss responsibility. Additionally, she was the President and COO of Tatte Bakery from February 2018 to August 2018 and the President and COO of Sweetgreen from December 2013 to February 2018. She was also the president of DryBar and the COO of both Pinkberry and Jamba Juice. She has evaluated dozens of restaurant and hospitality opportunities over the past 20+ years and is highly respected throughout the industry. Ms. Kelley attended the University of Colorado for two years.

Warren Thompson, 61
Director Nominee

Currently, Mr. Thompson is President and Chairman of Thompson Hospitality Corporation, the largest minority-owned food service and facilities management company in the U.S., where he began in October 1992. Mr. Thompson received his Bachelor of Arts in Managerial Economics from Hampden-Sydney College and holds an MBA from the University of Virginia’s Darden School of Business Administration.

Carolyn Trabuco, 52
Independent Director

Carolyn Trabuco, is Co-Founder and Independent Member of Public Company Board of Directors at Azul Brazilian Airline, where she has been since April 2007. Ms. Trabuco serves as Compensation Committee Chair, where she is responsible to oversee and approve all aspects of executive remuneration and remuneration philosophy using proprietary KPIs, and Corporate Social Responsibility Leader, where she orients, delegates, and empowers ESG efforts around issues that impact the airline and its role in society. Since December 2017, Ms. Trabuco has served as Principal and Founder of Thistledown Advisory Group, LLC, a research consulting firm. Since August 2020, Ms. Trabuco has served as Business Development Sector Leader for Aerospace & Defense, Advanced Manufacturing at AdvanceCT, where she established a state level business recruitment and retention practice for the advanced manufacturing and aerospace and defense industry sectors. From June 2016 to December 2016, Ms. Trabuco served as Managing Director under temporary assignment at Cornerstone Capital Group, where she authored a white paper commissioned by Stewart Investors, an active, long-only equity manager, that modeled the use of pre-financial ESG measures as a framework to forecast risks related to financial performance of 20 global oil and mining resources companies. Ms. Trabuco graduated from Georgetown University with a B.S. in Art History and an M.B.A. from Sacred Heart University in Public Administration.

ByKristi Marvin