Delaware |
6770 |
86-1370703 | ||
(State or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Number) |
Christian O. Nagler Matthew D. Turner Kirkland & Ellis LLP 601 Lexington Avenue New York, NY 10022 Telephone: (212) 446-4800 |
Jan Nugent Geoffrey Van Haeren Branded Online, Inc. dba Nogin 1775 Flight Way STE 400 Tustin, CA 92782 Telephone: (949) 864-8136 |
Ryan J. Maierson John M. Greer Ryan J. Lynch Latham & Watkins LLP 811 Main Street, Suite 3700 Houston, TX 77002 Telephone: (713) 546-5400 |
Large accelerated filer |
☐ |
Accelerated filer |
☐ | |||
☒ |
Smaller reporting company |
|||||
Emerging growth company |
(1) | The Business Combination Proposal— Annex A 1 Annex A-2 |
(2) | The Charter Approval Proposal— |
(3) | The Governance Proposal non-binding advisory basis, a separate proposal (the “Governance Proposal”) with respect to certain governance provisions in the Proposed Charter in accordance with United States Securities and Exchange Commission requirements; |
(4) | The Director Election Proposal |
(5) | The Nasdaq Proposal— |
J. Wood Capital Advisors LLC (the “Advisors”) for their respective engagements with Nogin and SWAG if SWAG Public Stockholders redeem 80% or more of their Public Shares; |
(6) | The Incentive Plan Proposal— |
(7) | The Adjournment Proposal— |
By Order of the Board of Directors | ||
| ||
Jonathan S. Huberman Chief Executive Officer, Chief Financial Officer and Chairman of the Board of Directors |
Page |
||||
i | ||||
ii | ||||
iii | ||||
1 | ||||
16 | ||||
18 | ||||
21 | ||||
23 | ||||
68 | ||||
80 | ||||
82 | ||||
91 | ||||
92 | ||||
96 | ||||
98 | ||||
99 | ||||
101 | ||||
107 | ||||
108 | ||||
116 | ||||
125 | ||||
126 | ||||
130 | ||||
133 | ||||
151 | ||||
152 | ||||
178 | ||||
180 | ||||
186 | ||||
190 | ||||
211 | ||||
212 | ||||
213 | ||||
214 | ||||
221 | ||||
224 | ||||
230 | ||||
239 | ||||
247 | ||||
252 | ||||
252 | ||||
252 | ||||
252 | ||||
F-1 |
Q: |
WHAT IS THE BUSINESS COMBINATION? |
A: | SWAG, Merger Sub, a wholly owned subsidiary of SWAG, and Nogin have entered into the Merger Agreement, pursuant to which Merger Sub will merge with and into Nogin, with Nogin surviving the Merger as a wholly owned subsidiary of SWAG. In connection with the Closing of the Merger, SWAG will be renamed Nogin, Inc. |
Q: |
WHY AM I RECEIVING THIS DOCUMENT? |
A: | SWAG is sending this proxy statement/prospectus to its stockholders to help them decide how to vote their shares of SWAG Common Stock with respect to the matters to be considered at the Special Meeting. The Business Combination cannot be completed unless SWAG’s stockholders approve the Business Combination Proposal, the Charter Approval Proposal, the Nasdaq Proposal and the Incentive Plan Proposal set forth in this proxy statement/prospectus for their approval. Information about the Special Meeting, the Business Combination and the other business to be considered by stockholders at the Special Meeting is contained in this proxy statement/prospectus. This document constitutes a proxy statement of SWAG and a prospectus of SWAG. It is a proxy statement because the board of directors of SWAG is soliciting proxies using this proxy statement/prospectus from its stockholders. It is a prospectus because SWAG, in connection with the Business Combination, is offering shares of SWAG Class A Common Stock in exchange for the outstanding shares of Nogin Common Stock and pursuant to the conversion of SWAG Class B Common Stock. See the section entitled “The Merger Agreement—Merger Consideration.” |
Q: |
WHAT WILL NOGIN STOCKHOLDERS RECEIVE IN THE BUSINESS COMBINATION? |
A: | As part of the Business Combination, Nogin equityholders will receive aggregate consideration of $566.0 million, payable in newly issued shares of SWAG Class A Common Stock at a price of $10.00 per share, with Nogin Stockholders having the option to elect to receive a pro rata portion of $15.0 million in cash consideration. |
Q: |
WHAT IS THE PIPE INVESTMENT? |
A: | On April 19, 2022, SWAG entered into PIPE Subscription Agreements with the PIPE Investors pursuant to which SWAG has agreed to issue up to an aggregate principal amount of $75.0 million of Convertible Notes and, for no additional consideration, an aggregate of 1.5 million PIPE Warrants to the PIPE Investors. The PIPE Investors have agreed to purchase $65.0 million aggregate principal amount of the Convertible Notes, with a subsidiary of UBS Hedge Fund Solutions LLC (“UBS”) having the option to purchase up to an additional $10.0 million aggregate principal amount of the Convertible Notes (together with additional PIPE Warrants) pursuant to an “accordion feature” included in UBS’s PIPE Subscription Agreement. Jonathan Huberman, Chief Executive Officer of SWAG, has also executed a PIPE Subscription Agreement for $0.5 million aggregate principal amount of Convertible Notes. PIPE Investors will also receive a pro rata portion of the PIPE Warrants for no additional consideration in connection with their respective commitments to purchase the Convertible Notes. The PIPE Investment is conditioned on (i) the substantially contemporaneous closing of the Merger and other Transactions as well as the execution of (x) an indenture governing the Convertible Notes (the “Indenture”) by and among SWAG, as issuer, certain guarantors named therein, and U.S. Bank Trust Company, National Association, as trustee and collateral agent and related agreements securing the payment of the obligations under the Convertible Notes and the Indenture, and (y) a warrant agreement (the “PIPE Warrant Agreement”), by and between SWAG, as issuer, and Continental Stock Transfer & Trust Company, as warrant agent; (ii) certain minimum cash and liquidity requirements; and (iii) other customary closing conditions. Copies of the forms of the PIPE Subscription Agreement, the Indenture and the PIPE Warrant Agreement are attached to this proxy statement/prospectus as Annex H Annex I Annex J |
Q: |
WHEN DO YOU EXPECT THE BUSINESS COMBINATION TO BE COMPLETED? |
A: | It is currently anticipated that the Business Combination will be consummated promptly following the Special Meeting, which is set for , 2022; however, such meeting could be adjourned, as described herein. Neither SWAG nor Nogin can assure you of when or if the Business Combination will be completed and it is possible that factors outside of the control of both companies could result in the Business Combination being completed at a different time or not at all. SWAG must first obtain the approval of its stockholders for certain of the proposals set forth in this proxy statement/prospectus for their approval, Nogin must first obtain the written consent of its stockholders for the Merger and SWAG and Nogin must also first obtain certain necessary regulatory approvals and satisfy other closing conditions. See the section entitled “The Merger Agreement—Conditions to the Business Combination.” |
Q: |
WHAT HAPPENS IF THE BUSINESS COMBINATION IS NOT COMPLETED? |
A: | If the Business Combination is not completed, Nogin Stockholders will not receive any consideration for their shares of Nogin capital stock. Instead, Nogin will remain an independent company. See the section entitled “The Merger Agreement—Termination” and “Risk Factors.” |
Q: |
HOW WILL SWAG BE MANAGED AND GOVERNED FOLLOWING THE BUSINESS COMBINATION? |
A: | SWAG does not currently have any management-level employees other than Jonathan Huberman, our Chairman, Chief Executive Officer and Chief Financial Officer, and Mike Nikzad, our Vice President, |
Acquisitions. Following the Closing, the Company’s executive officers are expected to be the current management team of Nogin. See the section entitled “ Management of the Post-Combination Company Following the Business Combination |
Q: |
WHAT EQUITY STAKE WILL CURRENT SWAG STOCKHOLDERS, THE INITIAL STOCKHOLDERS, THE PIPE INVESTORS AND THE NOGIN STOCKHOLDERS HOLD IN SWAG FOLLOWING THE CLOSING? |
A: | The following table illustrates varying ownership levels in the Post-Combination Company immediately following the Closing, assuming (i) no Public Shares are redeemed, (ii) 50% of Public Shares are redeemed and (iii) 100% of Public Shares are redeemed, each on a “shares outstanding” and “fully diluted” basis. All scenarios assume that the maximum amount of $15.0 million of Merger Consideration will be distributed pro rata to Nogin Stockholders in cash. The numbers of shares and percentage interests set forth below are based on a number of assumptions. If the actual facts differ from our assumptions, the number of shares and percentage interests set forth below will be different. For more information, see the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.” |
No Redemption Scenario (1) |
50% Redemption Scenario (2) |
100% Redemption Scenario (3) |
||||||||||||||||||||||||||||||||||||||||||||||
Outstanding Shares |
Outstanding Ownership |
Fully Diluted Shares |
Fully Diluted Ownership |
Outstanding Shares |
Outstanding Ownership |
Fully Diluted Shares |
Fully Diluted Ownership |
Outstanding Shares |
Outstanding Ownership |
Fully Diluted Shares |
Fully Diluted Ownership |
|||||||||||||||||||||||||||||||||||||
Current public SWAG stockholders |
22,807,868 | 27.6 | % | 34,211,802 | 25.6 | % | 11,403,934 | 16.0 | % | 22,807,868 | 18.9 | % | — | — | 11,403,934 | 10.4 | % | |||||||||||||||||||||||||||||||
Initial Stockholders |
5,701,967 | 6.9 | % | 15,684,721 | (4) |
11.7 | % | 5,701,967 | 8.0 | % | 15,684,721 | (4) |
13.0 | % | 5,701,967 | 9.5 | % | 15,684,721 | (4) |
14.4 | % | |||||||||||||||||||||||||||
Current Nogin equityholders |
54,195,137 | 65.5 | % | 56,218,247 | 41.9 | % | 54,195,137 | 76.0 | % | 56,218,247 | 46.6 | % | 54,195,137 | 90.1 | % | 56,218,247 | 51.5 | % | ||||||||||||||||||||||||||||||
PIPE Investors (5) |
— | — | 7,821,738 | 5.8 | % | — | — | 7,821,738 | 6.5 | % | — | — | 7,821,738 | 7.1 | % | |||||||||||||||||||||||||||||||||
Transaction Service Providers (6) |
— | — | — | — | — | — | — | — | 224,250 | 0.4 | % | 1,695,275 | 1.6 | % | ||||||||||||||||||||||||||||||||||
Incentive Plan (7) |
— | — | 20,106,442 | 15.0 | % | — | — | 18,093,983 | 15.0 | % | — | — | 16,380,690 | 15.0 | % | |||||||||||||||||||||||||||||||||
Pro forma Class A Common Stock at March 31, 2022 |
82,704,972 |
100.0 |
% |
134,042,950 |
100.0 |
% |
71,301,038 |
100.0 |
% |
120,626,557 |
100.0 |
% |
60,121,354 |
100.0 |
% |
109,204,605 |
100.0 |
% |
(1) | This presentation assumes that no public shareholders exercise their right to have their Public Shares converted into their pro rata share of the Trust Account. |
(2) | This presentation assumes that (i) public shareholders exercise their rights to have 50% of all outstanding Public Shares converted into their pro rata share of the Trust Account and (ii) such redeeming public shareholders continue to hold Public Warrants following exercise of their redemption rights. |
(3) | This presentation assumes that (i) approximately 22.8 million Public Shares are redeemed, resulting in an aggregate payment of approximately $231.5 million out of the Trust Account, which is derived from the number of Public Shares that could be redeemed in connection with the Merger at an assumed redemption price of $10.15 per share based on the Trust Account balance as of March 31, 2022 in order to satisfy the minimum Aggregate Transaction Proceeds of $50.0 million; and (ii) such redeeming public shareholders continue to hold Public Warrants following exercise of their redemption rights. |
(4) | Includes (i) all shares of Class A Common Stock subject to vesting requirements pursuant to the Sponsor Agreement, and (ii) all shares of Class A Common Stock issuable upon exercise of Private Placement Warrants. |
(5) | The PIPE Investors have currently committed to an aggregate of $65.0 million of Convertible Notes and 1.3 million PIPE Warrants. However, the numbers of shares and percentage interests in this table assume the following: (i) issuance of the maximum aggregate principal amount of $75.0 million of Convertible Notes and 1.5 million PIPE Warrants issued for no additional consideration in conjunction with the Convertible Notes assuming UBS exercises its accordion feature in full to purchase an additional $10.0 million aggregate principal amount of Convertible Notes, (ii) all of the Convertible Notes are converted into shares of Class A Common Stock at the initial conversion rate of 86.9565 shares of Class A Common Stock per $1,000 principal amount of Convertible Notes, (iii) all interest payable on the Convertible Notes is paid in cash and (iv) all PIPE Warrants are exercised on a cash basis for shares of Class A Common Stock. Includes shares of Class A Common Stock underlying Convertible Notes and PIPE Warrants subscribed for by Jonathan Huberman, Chief Executive Officer of SWAG. |
(6) | Reflects the portion of transaction fees to be settled in shares of the Post-Combination Company in lieu of cash, assuming the issuance of the maximum aggregate principal amount of $75.0 million of Convertible Notes and 1.5 million PIPE Warrants issued for no additional consideration in conjunction with the Convertible Notes, assuming UBS exercises its accordion |
feature in full to purchase an additional $10.0 million aggregate principal amount of Convertible Notes, to Stifel Nicolaus & Company, Incorporated, Jefferies LLC and J. Wood Capital Advisors LLC (the “Advisors”) for their respective engagements with Nogin and SWAG if SWAG Public Stockholders redeem 100% of the Public Shares. Some portion of each Advisor’s transaction fees will be settled in shares of the Post-Combination Company in lieu of cash if 80% or more of Public Shares are redeemed. See “Certain Engagements in Connection with the Business Combination and Related Transactions.” |
(7) | Reflects shares expected to be reserved for issuance under the Incentive Plan (assuming the Incentive Plan Proposal is approved). |
Q: |
FOLLOWING THE BUSINESS COMBINATION, WILL SWAG’S SECURITIES CONTINUE TO TRADE ON A STOCK EXCHANGE? |
A: | Yes. Upon the Closing, we intend to change our name from “SWAG” to “Nogin, Inc.,” and our Class A Common Stock and warrants will be listed following the closing under the symbols “NOGN” and “NOGNW,” respectively. We intend to continue to list our Class A Common Stock and warrants on Nasdaq following the Closing. SWAG’s units will be delisted and deregistered following the Closing. |
Q: |
WHEN AND WHERE IS THE SPECIAL MEETING? |
A: | The Special Meeting will be held at a.m. prevailing Eastern Time, on , 2022, in virtual format. SWAG stockholders may attend, vote and examine the list of SWAG stockholders entitled to vote at the Special Meeting by visiting and entering the control number found on their proxy card, voting instruction form or notice included in their proxy materials. In light of public health concerns regarding the coronavirus (“COVID-19”) pandemic, the Special Meeting will be held in virtual meeting format only. You will not be able to attend the Special Meeting physically. |
Q: |
WHAT AM I BEING ASKED TO VOTE ON AND WHY IS THIS APPROVAL NECESSARY? |
A: | The stockholders of SWAG are being asked to vote on the following: |
• | A proposal to adopt the Merger Agreement and the transactions contemplated thereby. See the section entitled “ Proposal No. 1—The Business Combination Proposal |
• | A proposal to adopt the Proposed Charter in the form attached hereto as Annex B. See the section entitled “ Proposal No. 2—The Charter Approval Proposal |
• | A proposal with respect to certain governance provisions in the Proposed Charter, which are being separately presented in accordance with SEC requirements and which will be voted upon on a non-binding advisory basis. See the section entitled “Proposal No. 3—The Governance Proposal |
• | A proposal to elect seven directors to serve on the Board until the 2023 annual meeting of stockholders, in the case of Class I directors, the 2024 annual meeting of stockholders, in the case of Class II directors, and the 2025 annual meeting of stockholders, in the case of Class III directors, and, in each case, until their respective successors are duly elected and qualified. See the section entitled “ Proposal No. 4—The Director Election Proposal |
• | A proposal to approve, for purposes of complying with applicable listing rules of Nasdaq: (i) the issuance of shares of SWAG Class A Common Stock to Nogin Stockholders pursuant to the Merger Agreement; (ii) the issuance of shares of SWAG Class A Common Stock pursuant to the conversion of SWAG Class B Common Stock; (iii) the potential future issuance of shares of SWAG Class A Common Stock to the PIPE Investors in connection with the Convertible Notes and PIPE Warrants, each of which may be issued to the PIPE Investors in connection with the PIPE Investment. See the section entitled “ Proposal No. 5—The Nasdaq Proposal |
• | A proposal to approve and adopt the Incentive Plan. See the section entitled “ Proposal No. 6—The Incentive Plan Proposal |
• | A proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Business Combination Proposal, the Charter Approval Proposal, the Director Election Proposal, the Nasdaq Proposal or the Incentive Plan Proposal. See the section entitled “ Proposal No. 7—The Adjournment Proposal |
Q: |
I AM A SWAG WARRANT HOLDER. WHY AM I RECEIVING THIS PROXY STATEMENT/PROSPECTUS? |
A: | Upon consummation of the Merger, the SWAG warrants shall, by their terms, entitle the holders to purchase Class A Common Stock at a purchase price of $11.50 per share. This proxy statement/prospectus includes important information about Nogin and the business of Nogin and its subsidiaries following consummation of the Merger. As holders of SWAG warrants will be entitled to purchase Class A Common Stock of the Post-Combination Company upon consummation of the Merger, SWAG urges you to read the information contained in this proxy statement/prospectus carefully. |
Q: |
WHO IS NOGIN? |
A: | Nogin’s purpose-built platform has been developed to offer full-stack enterprise-level capabilities to online retailers. |
Q: |
WHY IS SWAG PROPOSING THE BUSINESS COMBINATION? |
A: | SWAG was organized to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. |
Q: |
DID THE SWAG BOARD OBTAIN A THIRD-PARTY VALUATION OR FAIRNESS OPINION IN DETERMINING WHETHER OR NOT TO PROCEED WITH THE BUSINESS COMBINATION? |
A: | The SWAG Board did not obtain a third-party valuation or fairness opinion in connection with their determination to approve the Merger with Nogin. The directors and officers of SWAG and SWAG’s advisors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and concluded that their experience and backgrounds, together with the experience and sector expertise of SWAG’s financial advisors and consultants, enabled them to make the necessary analyses and determinations regarding the Merger with Nogin. In addition, SWAG’s directors and officers and SWAG’s advisors have substantial experience with mergers and acquisitions. Accordingly, investors will be relying solely on the judgment of the SWAG Board and SWAG’s advisors in valuing Nogin’s business. |
Q: |
WHY IS SWAG PROVIDING STOCKHOLDERS WITH THE OPPORTUNITY TO VOTE ON THE BUSINESS COMBINATION? |
A: | We are seeking approval of the Business Combination for purposes of complying with applicable Nasdaq listing rules requiring stockholder approval of issuances of more than 20% of a listed company’s issued and outstanding common stock. In addition, pursuant to the Existing Charter, we must provide all Public Stockholders with the opportunity to redeem all or a portion of their Public Shares upon the consummation of an initial business combination (as defined in our Existing Charter) either in conjunction with a tender offer or in conjunction with a stockholder vote to approve such initial business combination. If we submit the proposed initial business combination to the stockholders for their approval, our Existing Charter requires us to conduct a redemption offer in conjunction with the proxy solicitation (and not in conjunction with a tender offer) pursuant to the applicable SEC proxy solicitation rules. |
Q: |
DO NOGIN’S STOCKHOLDERS NEED TO APPROVE THE BUSINESS COMBINATION? |
A: | Yes. Concurrently with the execution of the Merger Agreement, SWAG, Merger Sub and the Supporting Nogin Stockholders (as defined herein) entered into the Company Support Agreement. The Company Support Agreement provides, among other things, each Supporting Nogin Stockholder agreed to (i) vote at any meeting of the stockholders of Nogin all of its Nogin Common Stock and/or Nogin Preferred Stock, as applicable (or any securities convertible into or exercisable or exchangeable for Nogin Common Stock or Nogin Preferred Stock), held of record or thereafter acquired in favor of the transactions and the adoption of the Merger Agreement; (ii) appoint the chief executive officer of Nogin as such stockholder’s proxy in the event such stockholder fails to fulfill its obligations under the Company Support Agreement, (iii) be bound by certain other covenants and agreements related to the Merger and (iv) be bound by certain transfer restrictions with respect to Nogin securities, in each case, on the terms and subject to the conditions set forth |
in the Company Support Agreement. The shares of Nogin capital stock that are owned by the Supporting Nogin Stockholders and subject to the Support Agreements represent approximately 84.1% of the outstanding shares of Nogin Common Stock and approximately 99.5% of the outstanding shares of Nogin Preferred Stock, in each case, as of February 10, 2022. The execution and delivery of written consents by all of the Supporting Nogin Stockholders will constitute the Nogin Stockholder approval at the time of such delivery. |
Q: |
DO I HAVE REDEMPTION RIGHTS? |
A: | If you are a holder of Public Shares, you have the right to demand that SWAG redeem such shares for a pro rata portion of the cash held in the Trust Account, which holds the proceeds of the SWAG IPO, as of two business days prior to the consummation of the transactions contemplated by the Business Combination Proposal (including interest earned on the funds held in the Trust Account and not previously released to SWAG to pay taxes) upon the Closing (“Redemption Rights”). |
Q: |
WILL HOW I VOTE AFFECT MY ABILITY TO EXERCISE REDEMPTION RIGHTS? |
A: | No. You may exercise your redemption rights whether you vote your shares of Public Shares for or against, or whether you abstain from voting on, the Business Combination Proposal or any other Proposal described in this proxy statement/prospectus. As a result, the Business Combination Proposal can be approved by stockholders who will redeem their Public Shares and no longer remain stockholders and the Merger may be consummated even though the funds available from the Trust Account and the number of Public Stockholders are substantially reduced as a result of redemptions by Public Stockholders. |
Q: |
HOW DO I EXERCISE MY REDEMPTION RIGHTS? |
A: | If you are a holder of Public Shares and wish to exercise your redemption rights, you must demand that SWAG redeem your shares for cash no later than the second business day preceding the vote on the Business Combination Proposal by delivering your stock to SWAG’s transfer agent physically or electronically using the Depository Trust Company’s DWAC (Deposit and Withdrawal at Custodian) system. Any holder of Public Shares will be entitled to demand that such holder’s Public Shares be redeemed for a pro rata portion of the amount then in the Trust Account (which, for illustrative purposes, was approximately $ , or $ per share, as of , 2022, the SWAG Record Date). Such amount, including interest earned on the funds held in the Trust Account and not previously released to SWAG to pay its taxes, will be paid promptly upon consummation of the Merger. However, under Delaware law, the proceeds held in the Trust Account could be subject to claims that could take priority over those of SWAG’s Public Stockholders exercising redemption rights, regardless of whether such holders vote for or against the Business Combination Proposal. Therefore, the per-share distribution from the Trust Account in such a situation may be less than originally anticipated due to such claims. Your vote on any Proposal will have no impact on the amount you will receive upon exercise of your redemption rights. |
Q: |
DO I HAVE APPRAISAL RIGHTS IF I OBJECT TO THE PROPOSED BUSINESS COMBINATION? |
A: | No. Neither SWAG stockholders nor its unit or warrant holders have appraisal rights in connection with the Business Combination under the DGCL. See the section entitled “ SWAG’s Special Meeting of Stockholders—Appraisal Rights. |
Q: |
WHAT HAPPENS TO THE FUNDS DEPOSITED IN THE TRUST ACCOUNT AFTER CONSUMMATION OF THE BUSINESS COMBINATION? |
A: | A total of $231,499,860 in net proceeds of the SWAG IPO and the amount raised from the private sale of warrants simultaneously with the consummation of the SWAG IPO was placed in the Trust Account following the SWAG IPO, including the partial exercise of the underwriter’s over-allotment option. After consummation of the Merger, the funds in the Trust Account will be used to pay holders of the Public Shares who exercise redemption rights, to pay fees and expenses incurred in connection with the Merger (including aggregate fees of up to $7,982,754 as deferred underwriting commissions) and for the Post-Combination Company’s working capital and general corporate purposes. |
Q: |
WHAT HAPPENS IF THE MERGER IS NOT CONSUMMATED? |
A: | If SWAG does not complete the Merger with Nogin for whatever reason, SWAG would search for another target business with which to complete a business combination. If SWAG does not complete the Merger with Nogin or another target business within 18 months after the closing of the SWAG IPO (the “Completion Window”), SWAG must redeem 100% of the outstanding Public Shares, at a per-share price, payable in cash, equal to the amount then held in the Trust Account including interest earned on the funds held in the Trust Account and not previously released to SWAG to pay taxes (less up to $100,000 of interest to pay dissolution expenses) divided by the number of outstanding Public Shares. The Initial Stockholders have no redemption rights in the event a business combination is not effected in the Completion Window, and, accordingly, their Founder Shares will be worthless. Additionally, in the event of such liquidation, there will be no distribution with respect to SWAG’s outstanding warrants. Accordingly, the warrants will expire worthless. |
Q: |
HOW DOES THE SPONSOR INTEND TO VOTE ON THE PROPOSALS? |
A: | The Initial Stockholders of record are entitled to vote an aggregate of 20% of the outstanding shares of SWAG Common Stock. The Sponsor and SWAG’s directors and officers have agreed to vote any Founder Shares and any Public Shares held by them as of the SWAG Record Date in favor of each of the proposals presented at the Special Meeting. |
Q: |
WHAT CONSTITUTES A QUORUM AT THE SPECIAL MEETING? |
A: | A majority of the voting power of the issued and outstanding common stock of SWAG entitled to vote at the Special Meeting must be present, in person (which would include presence at a virtual meeting) or represented by proxy, at the Special Meeting to constitute a quorum and in order to conduct business at the Special Meeting. Abstentions and broker non-votes will be counted as present for the purpose of determining a quorum. The holders of the Founder Shares, who currently own 20% of the issued and outstanding shares of SWAG Common Stock, will count towards this quorum. In the absence of a quorum, the chairman of the Special Meeting has power to adjourn the Special Meeting. As of the SWAG Record Date for the Special Meeting, shares of common stock would be required to achieve a quorum. |
Q: |
WHAT VOTE IS REQUIRED TO APPROVE EACH PROPOSAL AT THE SPECIAL MEETING? |
A: | The Business Combination Proposal: non-vote with regard to the Business Combination Proposal, will have no effect on the Business Combination Proposal. SWAG stockholders must approve the Business Combination Proposal in order for the Merger to occur. |
Q: |
DO ANY OF SWAG’S DIRECTORS OR OFFICERS HAVE INTERESTS IN THE BUSINESS COMBINATION THAT MAY DIFFER FROM OR BE IN ADDITION TO THE INTERESTS OF SWAG STOCKHOLDERS? |
A: | Certain of SWAG’s executive officers and certain non-employee directors may have interests in the Merger that may be different from, or in addition to, the interests of SWAG stockholders generally. |
• | If the Business Combination with Nogin or another business combination is not consummated within the Completion Window, SWAG will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding Public Shares for cash and, subject to the approval of its remaining stockholders and the SWAG Board, dissolving and liquidating. In such event, the 5,701,967 Founder Shares held by SWAG’s Initial Stockholders would be worthless because SWAG’s Initial Stockholders are not entitled to participate in any redemption or distribution with respect to such shares. Such Founder Shares had an aggregate market value of $ based upon the closing price of $ per share of Class A Common Stock on the Nasdaq on , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus. |
• | The Sponsor purchased an aggregate of 9,982,754 Private Placement Warrants from SWAG for an aggregate purchase price of $9,982,754 (or $1.00 per warrant). These purchases took place on a private placement basis simultaneously with the consummation of the SWAG IPO. A portion of the proceeds SWAG received from these purchases were placed in the Trust Account. Such warrants had an aggregate market value of $ based upon the closing price of $ per public warrant on the Nasdaq on , 2022, the most recent practicable date prior to the date of this proxy |
statement/prospectus. The Private Placement Warrants would become worthless if SWAG does not consummate a business combination within the Completion Window. |
• | No compensation of any kind, including finder’s and consulting fees, is paid to our Sponsor, officers and directors, or any of their respective affiliates, for services rendered prior to or in connection with the completion of an initial business combination, except for reimbursement for out-of-pocket out-of-pocket |
Q: |
WHAT DO I NEED TO DO NOW? |
A: | SWAG urges you to read carefully and consider the information contained in this proxy statement/prospectus, including the Annexes and the other documents referred to herein, and to consider how the Merger will affect you as a stockholder and/or warrant holder of SWAG. Stockholders should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus and on the enclosed proxy card. |
Q: |
WHAT HAPPENS IF I SELL MY SHARES OF CLASS A COMMON STOCK BEFORE THE SPECIAL MEETING? |
A: | The SWAG Record Date for the Special Meeting is earlier than the date that the Business Combination is expected to be completed. If you transfer your shares of Class A Common Stock after the SWAG Record Date, but before the Special Meeting, unless the transferee obtains from you a proxy to vote those shares, you will retain your right to vote at the Special Meeting. However, you will not be able to seek redemption of your shares of Class A Common Stock because you will no longer be able to tender them prior to the Special Meeting in accordance with the provisions described herein. If you transferred your shares of Class A Common Stock prior to the SWAG Record Date, you have no right to vote those shares at the Special Meeting or redeem those shares for a pro rata portion of the proceeds held in the Trust Account. |
Q: |
HOW DO I VOTE? |
A: | If you are a holder of record of SWAG Common Stock on the SWAG Record Date, you may vote in person (which would include presence at a virtual meeting) at the Special Meeting or by submitting a proxy for the Special Meeting. You may submit your proxy by completing, signing, dating and returning the enclosed proxy card in the accompanying pre-addressed postage paid envelope. If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or nominee, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the broker, bank or nominee with instructions on how to vote your shares or, if you wish to attend the meeting and vote in person (which would include presence at a virtual meeting), obtain a proxy from your broker, bank or nominee. |
Q: |
IF MY SHARES ARE HELD IN “STREET NAME” BY A BROKER, BANK OR OTHER NOMINEE, WILL MY BROKER, BANK OR OTHER NOMINEE VOTE MY SHARES FOR ME? |
A: | If your shares are held in “street name” in a stock brokerage account or by a broker, bank or other nominee, you must provide the record holder of your shares with instructions on how to vote your shares. Please |
follow the voting instructions provided by your broker, bank or other nominee. Please note that you may not vote shares held in “street name” by returning a proxy card directly to SWAG or by voting in person (which would include presence at a virtual meeting) at the Special Meeting unless you provide a “legal proxy”, which you must obtain from your broker, bank or other nominee. |
Q: |
WHAT IF I ATTEND THE SPECIAL MEETING AND ABSTAIN OR DO NOT VOTE? |
A: | For purposes of the Special Meeting, an abstention occurs when a stockholder attends the meeting in person (which would include presence at a virtual meeting) and does not vote or returns a proxy with an “abstain” vote. |
Q: |
WHAT WILL HAPPEN IF I RETURN MY PROXY CARD WITHOUT INDICATING HOW TO VOTE? |
A: | If you sign and return your proxy card without indicating how to vote on any particular proposal, the common stock represented by your proxy will be voted “ FOR |
Q: |
MAY I CHANGE MY VOTE AFTER I HAVE MAILED MY SIGNED PROXY CARD? |
A: | Yes. You may change your vote at any time before your proxy is exercised by doing any one of the following: |
• | send another proxy card with a later date; |
• | notify SWAG’s Secretary in writing before the Special Meeting that you have revoked your proxy; or |
• | attend the Special Meeting and vote electronically by visiting and entering the control number found on your proxy card, instruction form or notice you previously received. |
Q: |
WHAT HAPPENS IF I FAIL TO TAKE ANY ACTION WITH RESPECT TO THE SPECIAL MEETING? |
A: | If you fail to take any action with respect to the Special Meeting and the Merger is approved by stockholders and consummated, you will become a stockholder of the Post-Combination Company. Failure to take any action with respect to the Special Meeting will not affect your ability to exercise your redemption rights. If you fail to take any action with respect to the Special Meeting and the Merger is not approved, you will continue to be a stockholder and/or warrant holder of SWAG while SWAG searches for another target business with which to complete a business combination. |
Q: |
WHAT SHOULD I DO IF I RECEIVE MORE THAN ONE SET OF VOTING MATERIALS? |
A: | Stockholders may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast a vote with respect to all of your SWAG shares. |
Q: |
WHO CAN HELP ANSWER MY QUESTIONS? |
A: | If you have questions about the Merger or if you need additional copies of the proxy statement/prospectus or the enclosed proxy card you should contact: |
No Redemption Scenario (1) |
50% Redemption Scenario (2) |
100% Redemption Scenario (3) |
||||||||||||||||||||||||||||||||||||||||||||||
Outstanding Shares |
Outstanding Ownership |
Fully Diluted Shares |
Fully Diluted Ownership |
Outstanding Shares |
Outstanding Ownership |
Fully Diluted Shares |
Fully Diluted Ownership |
Outstanding Shares |
Outstanding Ownership |
Fully Diluted Shares |
Fully Diluted Ownership |
|||||||||||||||||||||||||||||||||||||
Current public SWAG stockholders |
22,807,868 | 27.6 | % | 34,211,802 | 25.6 | % | 11,403,934 | 16.0 | % | 22,807,868 | 18.9 | % | — | 0.0 | % | 11,403,934 | 10.4 | % | ||||||||||||||||||||||||||||||
Initial Stockholders |
5,701,967 | 6.9 | % | 15,684,721 | (4) |
11.7 | % | 5,701,967 | 8.0 | % | 15,684,721 | (4) |
13.0 | % | 5,701,967 | 9.5 | % | 15,684,721 | (4) |
14.4 | % | |||||||||||||||||||||||||||
Current Nogin equityholders |
54,195,137 |
65.5 |
% |
56,218,247 |
41.9 |
% |
54,195,137 |
76.0 |
% |
56,218,247 |
46.6 |
% |
54,195,137 |
90.1 |
% |
56,218,247 |
51.5 |
% | ||||||||||||||||||||||||||||||
PIPE Investors (5) |
— | 0.0 | % | 7,821,738 | 5.8 | % | — | 0.0 | % | 7,821,738 | 6.5 | % | — | 0.0 | % | 7,821,738 | 7.1 | % | ||||||||||||||||||||||||||||||
Transaction Service Providers (6) |
— | 0.0 | % | — | 0.0 | % | — | 0.0 | % | — | 0.0 | % | 224,250 | 0.4 | % | 1,695,275 | 1.6 | % | ||||||||||||||||||||||||||||||
Incentive Plan (7) |
— | 0.0 | % | 20,106,442 | 15.0 | % | — | 0.0 | % | 18,093,983 | 15.0 | % | — | 0.0 | % | 16,380,690 | 15.0 | % | ||||||||||||||||||||||||||||||
Pro forma Class A Common Stock at March 31, 2022 |
82,704,972 |
100.0 |
% |
134,042,950 |
100.0 |
% |
71,301,038 |
100.0 |
% |
120,626,557 |
100.0 |
% |
60,121,354 |
100.0 |
% |
109,204,605 |
100.0 |
% |
(1) | This presentation assumes that no public shareholders exercise their right to have their Public Shares converted into their pro rata share of the Trust Account. |
(2) | This presentation assumes that (i) public shareholders exercise their rights to have 50% of all outstanding Public Shares converted into their pro rata share of the Trust Account and (ii) such redeeming public shareholders continue to hold Public Warrants following exercise of their redemption rights. |
(3) | This presentation assumes that (i) approximately 22.8 million Public Shares are redeemed, resulting in an aggregate payment of approximately $231.5 million out of the Trust Account, which is derived from the number of Public Shares that could be redeemed in connection with the Merger at an assumed redemption price of $10.15 per share based on the Trust Account balance as of March 31, 2022 in order to satisfy the minimum Aggregate Transaction Proceeds of $50.0 million; and (ii) such redeeming public shareholders continue to hold Public Warrants following exercise of their redemption rights. |
(4) | Includes (i) all shares of Class A Common Stock subject to vesting requirements pursuant to the Sponsor Agreement, and (ii) all shares of Class A Common Stock issuable upon exercise of Private Placement Warrants. |
(5) | The PIPE Investors have currently committed to an aggregate of $65.0 million of Convertible Notes and 1.3 million PIPE Warrants. However, the numbers of shares and percentage interests in this table assume the following: (i) issuance of the maximum aggregate principal amount of $75.0 million of Convertible Notes and 1.5 million PIPE Warrants issued for no additional consideration in conjunction with the Convertible Notes assuming UBS |
exercises its accordion feature in full to purchase an additional $10.0 million aggregate principal amount of Convertible Notes,, (ii) all of the Convertible Notes are converted into shares of Class A Common Stock at the initial conversion rate of 86.9565 shares of Class A Common Stock per $1,000 principal amount of Convertible Notes, (iii) all interest payable on the Convertible Notes is paid in cash and (iv) all PIPE Warrants are exercised on a cash basis for shares of Class A Common Stock. Includes shares of Class A Common Stock underlying Convertible Notes and PIPE Warrants subscribed for by Jonathan Huberman, Chief Executive Officer of SWAG. |
(6) | Reflects the portion of transaction fees to be settled in shares of the Post-Combination Company in lieu of cash, assuming the issuance of the maximum aggregate principal amount of $75.0 million of Convertible Notes and 1.5 million PIPE Warrants issued for no additional consideration in conjunction with the Convertible Notes, assuming UBS exercises its accordion feature in full to purchase an additional $10.0 million aggregate principal amount of Convertible Notes, to Stifel Nicolaus & Company, Incorporated, Jefferies LLC and J. Wood Capital Advisors LLC (the “Advisors”) for their respective engagements with Nogin and SWAG if SWAG Public Stockholders redeem 100% of the Public Shares. Some portion of each Advisor’s transaction fees will be settled in shares of the Post-Combination Company in lieu of cash if 80% or more of Public Shares are redeemed. See “Certain Engagements in Connection with the Business Combination and Related Transactions.” |
(7) | Reflects shares expected to be reserved for issuance under the Incentive Plan (assuming the Incentive Plan Proposal is approved). |
• | If the Business Combination with Nogin or another business combination is not consummated within the Completion Window, SWAG will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding Public Shares for cash and, subject to the approval of its remaining stockholders and the SWAG Board, dissolving and liquidating. In such event, the 5,701,967 Founder Shares held by SWAG’s Initial Stockholders would be worthless because SWAG’s Initial Stockholders are not entitled to participate in any redemption or distribution with respect to such shares. Such Founder Shares had an aggregate market value of $ based upon the closing price of $ per share of Class A Common Stock on the Nasdaq on , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus. |
• | The Sponsor purchased an aggregate of 9,982,754 Private Placement Warrants from SWAG for an aggregate purchase price of $9,982,754 (or $1.00 per warrant). These purchases took place on a private |
placement basis simultaneously with the consummation of the SWAG IPO. A portion of the proceeds SWAG received from these purchases was placed in the Trust Account. Such warrants had an aggregate market value of $ based upon the closing price of $ per public warrant on the Nasdaq on , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus. The Private Placement Warrants would become worthless if SWAG does not consummate a business combination within the Completion Window. |
• | No compensation of any kind, including finder’s and consulting fees, is paid to our Sponsor, officers and directors, or any of their respective affiliates, for services rendered prior to or in connection with the completion of an initial business combination, except for reimbursement for out-of-pocket out-of-pocket |
• | there must not be in effect any order prohibiting or preventing the consummation of the Business Combination and no law adopted, enacted or promulgated that makes consummation of the Business Combination illegal or otherwise prohibited; |
• | all waiting periods and any extensions thereof applicable to the transactions contemplated by the Merger Agreement under the HSR Act, and any commitments or agreements (including timing agreements) with any governmental entity not to consummate the Business Combination before a certain date, must have expired or been terminated; |
• | the offer contemplated by this proxy statement/prospectus must have been completed in accordance with the terms of the Merger Agreement and this proxy statement/prospectus; |
• | the approval of each of the proposals set forth in this proxy statement/prospectus must have been obtained in accordance with the DGCL, SWAG’s Organizational Documents and the rules and regulations of Nasdaq; |
• | the approval of the Business Combination by the holders of Nogin Common Stock and Nogin Preferred Stock must have been obtained in accordance with the DGCL and Nogin’s organizational documents; |
• | the Registration Statement must have become effective in accordance with the Securities Act and no stop order suspending the effectiveness of the Registration Statement be in effect and no proceedings for that purpose have commenced or be threatened by the SEC; |
• | the SWAG Common Stock to be issued in the Business Combination must have been approved by the Nasdaq, subject only to official notice of issuance thereof. |
• | the representations and warranties of Nogin (other than fundamental representations), disregarding qualifications contained therein relating to materiality, must be true and correct as of the Closing Date as if made at and as of such time (or, if given as of an earlier date, as of such earlier date), except that this condition will be satisfied unless any and all inaccuracies in such representations and warranties of Nogin, in the aggregate, would or would reasonably be expected to result in a Material Adverse Effect with respect to Nogin, and fundamental representations must be true an correct in all respects as of the Closing Date (or, if given as of an earlier date, such earlier date); |
• | Nogin must have performed in all material respects its obligations under the Merger Agreement required to be performed by it at or prior to the Closing; |
• | SWAG must have received a certificate executed and delivered by an authorized officer of Nogin confirming that the conditions set forth in the immediately preceding bullet points have been satisfied; |
• | the Parent Parties must have received a copy of the written consent of the holders of Nogin Common Stock and Nogin Preferred Stock, which must remain in full force and effect; and |
• | since the date of the Merger Agreement, a Material Adverse Effect with respect to Nogin must not have occurred. |
• | the representations and warranties of the Parent Parties (other than fundamental representations), disregarding qualifications contained therein relating to materiality, must be true and correct as of the Closing Date as if made at and as of such time (or, if given as of an earlier date, as of such earlier date), except that this condition will be satisfied unless any and all inaccuracies in such representations and warranties of the Parent Parties, in the aggregate, would or would reasonably be expected to result in a Material Adverse Effect with respect to the Parent Parties, and fundamental representations must be true an correct in all respects as of the Closing Date (or, if given as of an earlier date, such earlier date); |
• | each of the Parent Parties must have performed in all material respects its obligations under the Merger Agreement required to be performed by it at or prior to the Closing; |
• | Nogin must have received a certificate executed and delivered by an authorized officer of the Parent Parties confirming that the conditions set forth in the immediately preceding bullet points have been satisfied; |
• | the proceeds from the Business Combination, consisting of (a) the aggregate cash proceeds available for release to SWAG from the Trust Account in connection with the Business Combination (after, for the avoidance of doubt, giving effect to any redemptions of shares of SWAG Common Stock by stockholders of SWAG but before release of any other funds) plus (b) proceeds received in connection with any PIPE investment, must be equal to or in excess of $50 million; and |
• | the directors and executive officers of SWAG must have been removed from their respective positions or tendered their irrevocable resignations effective as of the Closing. |
• | in writing, by mutual consent of the Parties; |
• | by SWAG or Nogin if any law or order permanently restraining, enjoining or otherwise prohibiting the consummation of the Merger has been enacted and has become final and non-appealable, except that a party may not terminate the Merger Agreement for this reason if it has breached in any material respect its obligations set forth in this Agreement in any manner than has proximately contributed to the enactment, issuance, promulgation or entry into such law or order; |
• | by Nogin (if not in breach such that a closing condition cannot be satisfied) if any representation or warranty is not true and correct or if SWAG has failed to perform any covenant or agreement made by any Parent Party in the Merger Agreement, such that the conditions to the obligations of SWAG, as described in the section entitled “—Conditions to Closing of the Business Combination” above, could not be satisfied as of the Closing Date, and (ii) are or cannot be cured within thirty days after written notice from Nogin of such breach is received by the Parent Parties, or which breach, untruth or inaccuracy, by its nature, cannot be cured prior to the Outside Date; |
• | by SWAG (if not in breach such that a closing condition cannot be satisfied) if any representation or warranty is not true and correct or if Nogin has failed to perform any covenant or agreement made by Nogin in the Merger Agreement, such that the conditions to the obligations of Nogin, as described in the section entitled “—Conditions to Closing of the Business Combination” above, could not be satisfied as of the Closing Date, and (ii) are or cannot be cured within thirty days after written notice from SWAG of such breach is received by the Parent Parties, or which breach, untruth or inaccuracy, by its nature, cannot be cured prior to the Outside Date; |
• | by written notice by any Party if the Closing has not occurred on or prior to August 31, 2022 so long as such Party is not then in breach of the Merger Agreement in a manner that contributed to the occurrence of the failure of a condition; |
• | by Nogin if SWAG’s board of directors changes its recommendation in favor of the Business Combination; |
• | by SWAG if the required approvals of Nogin have not been obtained within five business days following the time that the registration statement of which this proxy statement/prospectus forms a part is declared effective; or |
• | by SWAG or Nogin if the approval of the Transaction Proposals is not obtained at the Parent Common Stockholders Meeting (including any adjournments of such meeting). |
• | Nogin has a history of operating losses, and it may not be able to generate sufficient revenue to achieve and sustain profitability. |
• | Nogin has experienced strong growth in recent periods, and its recent growth rates may not be indicative of its future growth. |
• | Nogin’s projections rely in large part upon assumptions and analyses developed by us and if these assumptions and analyses prove to be incorrect, Nogin’s actual operating results may be materially different from the forecasted results. |
• | Nogin’s future revenue and operating results will be harmed if it is unable to acquire new customers, retain existing customers, expand sales to its existing customers, develop new functionality for its CaaS platform that achieves market acceptance, or the increase in ecommerce during the COVID-19 pandemic fails to continue after the pandemic ends. |
• | Nogin may not be able to successfully implement its growth strategy on a timely basis or at all. |
• | Failure to effectively develop and expand Nogin’s marketing and sales capabilities could harm its ability to increase its customer base and achieve broader market acceptance of its CaaS platform. If Nogin is not able to generate traffic to its website through digital marketing, its ability to attract new customers may be impaired. |
• | Nogin’s operating results are subject to seasonal fluctuations. |
• | Nogin’s sales cycle with large enterprise customers can be long and unpredictable, and its sales efforts require considerable time and expense. |
• | If Nogin fails to maintain or grow its brand recognition, its ability to expand its customer base will be impaired and its financial condition may suffer. |
• | If Nogin fails to offer high quality support, its business and reputation could suffer. |
• | If Nogin fails to improve and enhance the functionality, performance, reliability, design, security and scalability of its CaaS platforms and innovate and introduce new solutions in a manner that responds to its customers’ evolving needs, its business may be adversely affected. |
• | Payment transactions on Nogin’s CaaS platform subject it to regulatory requirements, additional fees, and other risks that could be costly and difficult to comply with or that could harm our business. |
• | Activities of customers, their shoppers, and Nogin’s partners could damage its brand, subject it to liability and harm its business and financial results. |
• | Nogin is dependent upon customers’ continued and unimpeded access to the internet, and upon their willingness to use the internet for commerce. |
• | Nogin’s stockholders and SWAG’s stockholders will each have a reduced ownership and voting interest after the Business Combination and will exercise less influence over management. |
• | There can be no assurance that the Post-Combination Company’s common stock will be approved for listing on the Nasdaq or that the Post-Combination Company will be able to comply with the continued listing standards of the Nasdaq. |
• | The market price of shares of the Post-Combination Company’s common stock after the Business Combination may be affected by factors different from those currently affecting the prices of shares of SWAG Class A Common Stock. |
• | SWAG has not obtained an opinion from an independent investment banking firm, and consequently, there is no assurance from an independent source that the Merger Consideration is fair to its stockholders from a financial point of view. |
• | If the Business Combination’s benefits do not meet the expectations of financial analysts, the market price of our common stock may decline. |
• | The consummation of the Business Combination is subject to a number of conditions and if those conditions are not satisfied or waived, the Merger Agreement may be terminated in accordance with its terms and the Business Combination may not be completed. |
• | SWAG directors and officers may have interests in the Business Combination different from the interests of SWAG stockholders. |
• | Nogin directors and officers may have interests in the Business Combination different from the interests of Nogin Stockholders. |
• | Our Sponsor may have interests in the Business Combination different from the interests of SWAG stockholders. |
• | The unaudited pro forma condensed combined financial information included in this proxy statement/prospectus is preliminary and the actual financial condition and results of operations after the Business Combination may differ materially. |
• | If third parties bring claims against us, the proceeds held in the Trust Account could be reduced and the per share redemption amount received by stockholders may be less than $10.15 per share. |
• | Our independent directors may decide not to enforce the indemnification obligations of our Sponsor, resulting in a reduction in the amount of funds in the Trust Account available for distribution to our Public Stockholders. |
• | The ability of SWAG stockholders to exercise redemption rights with respect to a large number of shares could increase the probability that the Business Combination would be unsuccessful and that stockholders would have to wait for liquidation in order to redeem their stock. |
• | Unlike some other blank check companies, SWAG does not have a specified maximum redemption threshold, except that in no event will we redeem our Public Shares in an amount that would cause our net tangible assets to be less than $5,000,001. The absence of such a redemption threshold will make it easier for us to consummate the Business Combination even if a substantial number of our stockholders redeem. |
For the three months ended March 31, 2022 (unaudited) |
Period from January 5, 2021 (inception) through December 31, 2021 (audited) |
|||||||
Statement of Operations Data: |
||||||||
Operating and formation costs |
$ | 1,203,180 | $ | 1,917,009 | ||||
Net loss |
$ | (1,179,868 | ) | $ | (1,954,091 | ) | ||
Earnings Per Share Data: |
||||||||
Weighted Average Share of Class A Outstanding—Basic and Diluted |
22,807,868 | 10,024,409 | ||||||
Loss Per Share Class A—Basic and Diluted |
$ | (0.04 | ) | $ | (0.13 | ) | ||
Weighted Average Shares of Class B Outstanding—Basic and Diluted |
5,701,967 | 5,304,936 | ||||||
Loss Per Share Class B—Basic and Diluted |
$ | (0.04 | ) | $ | (0.13 | ) |
As of March 31, 2022 (unaudited) |
As of December 31, 2021 (audited) |
|||||||
Balance Sheet Data: |
||||||||
Working capital |
$ | (1,412,378 | ) | $ | (440,843 | ) | ||
Total assets |
232,096,724 | 232,365,298 | ||||||
Total liabilities |
10,200,329 | 9,289,035 | ||||||
Stockholders’ deficit |
(9,603,465 | ) | (8,423,597 | ) |
For the Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
($ in thousands, except share and per share data) |
||||||||||||
Revenue |
$ | 101,348 | $ | 45,517 | $ | 40,954 | ||||||
Operating costs and expenses |
107,627 | 47,660 | 43,245 | |||||||||
|
|
|
|
|
|
|||||||
Operating loss |
(6,279 | ) | (2,143 | ) | (2,291 | ) | ||||||
Change in fair value of unconsolidated affiliate |
4,937 | — | — | |||||||||
Other income, net |
2,452 | 1,193 | 2,316 | |||||||||
|
|
|
|
|
|
|||||||
Income (Loss) before income taxes |
1,110 | (950 | ) | 25 | ||||||||
Provision for income tax |
1,175 | 190 | 25 | |||||||||
|
|
|
|
|
|
|||||||
Net Loss |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
|
|
|
|
|
|
|||||||
Weighted average shares outstanding—basic and diluted |
9,129,358 | 9,129,358 | 9,130,726 | |||||||||
Net loss per common share—basic and diluted |
$ | (0.01 | ) | $ | (0.12 | ) | $ | — |
For the Three Months Ended March 31, |
||||||||
2022 |
2021 |
|||||||
($ in thousands, except share and per share data) |
||||||||
Revenue |
$ | 25,199 | $ | 11,930 | ||||
Operating costs and expenses |
35,252 | 13,599 | ||||||
|
|
|
|
|||||
Operating loss |
(10,053 | ) | (1,669 | ) | ||||
Change in fair value of unconsolidated affiliate |
(1,033 | ) | — | |||||
Other income, net |
1,302 | 179 | ||||||
|
|
|
|
|||||
Loss before income taxes |
(9,784 | ) | (1,489 | ) | ||||
Provision for income tax |
158 | 5 | ||||||
|
|
|
|
|||||
Net Loss |
$ | (9,942 | ) | $ | (1,494 | ) | ||
|
|
|
|
|||||
Weighted average shares outstanding—basic and diluted |
9,129,358 | 9,129,358 | ||||||
Net loss per common share—basic and diluted |
$ | (1.09 | ) | $ | (0.16 | ) |
As of March 31 2022 |
As of December 31, | |||||||||||
2021 |
2020 |
|||||||||||
($ in thousands) |
||||||||||||
Working capital |
$ | (3,562 | ) | $ | (1,171 | ) | $ | (2,074 | ) | |||
Total assets |
51,017 | 54,731 | 23,841 | |||||||||
Total liabilities |
62,942 | 56,772 | 25,870 | |||||||||
Convertible, redeemable preferred stock |
11,189 | 11,189 | 11,189 | |||||||||
Stockholders’ equity |
(23,114 | ) | (13,230 | ) | (13,218 | ) |
• | Assuming “No Redemptions”: This presentation assumes that no public shareholders exercise their right to have their public shares converted into their pro rata share of the Trust Account; |
• | Assuming “Maximum Redemptions”: This presentation assumes that approximately 22.8 million public shares are redeemed, resulting in an aggregate payment of approximately $231.5 million out of the Trust Account, which is derived from the number of shares that could be redeemed in connection with the Merger at an assumed redemption price of $10.15 per share based on the Trust Account balance as of March 31, 2022 in order to satisfy the minimum Aggregate Transaction Proceeds of $50.0 million. |
Pro Forma Combined |
||||||||
No Redemptions Scenario |
Maximum Redemptions Scenario |
|||||||
($ in thousands, except share and per share data) |
||||||||
Summary Unaudited Pro Forma Condensed Combined |
||||||||
Statement of Operations Data |
||||||||
Three Months Ended March 31, 2022 |
||||||||
Revenue |
$ | 25,199 | $ | 25,199 | ||||
Net loss |
$ | (12,300 | ) | $ | (12,300 | ) | ||
Weighted Average Common Shares Outstanding—Basic and Diluted |
82,704,972 | 60,116,354 | ||||||
Loss Per Common Share—Basic and Diluted |
$ | (0.15 | ) | $ | (0.20 | ) | ||
Summary Unaudited Pro Forma Condensed Combined |
||||||||
Balance Sheet Data as of March 31, 2022 |
||||||||
Total assets |
$ | 281,828 | $ | 68,816 | ||||
Total liabilities |
$ | 98,622 | $ | 114,947 | ||||
Total stockholders’ equity (deficit) |
$ | 183,206 | $ | (46,131 | ) |
Pro Forma Combined |
||||||||
No Redemptions Scenario |
Maximum Redemptions Scenario |
|||||||
($ in thousands, except share and per share data) |
||||||||
Summary Unaudited Pro Forma Condensed Combined |
||||||||
Statement of Operations Data |
||||||||
Twelve Months Ended December 31, 2021 |
||||||||
Revenue |
$ | 101,348 | $ | 101,348 | ||||
Net loss |
$ | (14,040 | ) | $ | (14,040 | ) | ||
Weighted Average Common Shares Outstanding—Basic and Diluted |
82,704,972 | 60,116,354 | ||||||
Loss Per Common Share—Basic and Diluted |
$ | (0.17 | ) | $ | (0.23 | ) |
• | Assuming No Redemptions |
• | Assuming Maximum Redemptions |
Historical |
No Redemptions Scenario |
Maximum Redemptions Scenario |
||||||||||||||
For the Three Months Ending March 31, 2022 |
SWAG |
Nogin |
Pro Forma Combined |
Pro Forma Combined |
||||||||||||
Pro Forma Earnings Per Share |
||||||||||||||||
Net Loss |
$ | (1,180 | ) | $ (9,942) | $(12,300) | $(12,300) | ||||||||||
Weighted Average Share of Class A Outstanding—Basic and Diluted |
22,807,868 | — | 82,704,972 | 60,116,354 | ||||||||||||
Loss Per Share Class A—Basic and Diluted |
$ | (0.04 | ) | $— | $(0.15) | $(0.20) | ||||||||||
Weighted Average Shares of Class B Outstanding—Basic and Diluted |
5,701,967 | — | — | — | ||||||||||||
Loss Per Share Class B—Basic and Diluted |
$ | (0.04 | ) | $ — | — | — | ||||||||||
Weighted Average Common Shares Outstanding—Basic and Diluted |
— | 9,129,358 | — | — | ||||||||||||
Loss Per Common Share—Basic and Diluted |
— | $ (1.09) | $ — | $ — |
Historical |
No Redemptions Scenario |
Maximum Redemptions Scenario |
||||||||||||||
For the Year Ending December 31, 2021 |
SWAG (Historical from 1/5/21 through 12/31/21) |
Nogin |
Pro Forma Combined |
Pro Forma Combined |
||||||||||||
Pro Forma Earnings Per Share |
||||||||||||||||
Net loss |
$ | (1,954 | ) | $ | (65 | ) | $ | (14,040 | ) | $ | (14,040 | ) | ||||
Weighted Average Shares of Class A Outstanding—Basic and Diluted |
10,024,409 | — | 82,704,972 | 60,116,354 | ||||||||||||
Loss Per Share Class A—Basic and Diluted |
$ | (0.13 | ) | $ | (0.17 | ) | $ | (0.23 | ) | |||||||
Weighted Average Shares of Class B Outstanding—Basic and Diluted |
5,304,936 | — | — | — | ||||||||||||
Loss Per Share Class B—Basic and Diluted |
$ | (0.13 | ) | — | — | |||||||||||
Weighted Average Common Shares Outstanding—Basic and Diluted |
— | 9,129,358 | — | — | ||||||||||||
Loss Per Common Share—Basic and Diluted |
— | $ | (0.01 | ) | — | — |
• | execute its business strategy, including monetization of services provided and expansions in and into existing and new lines of business; |
• | anticipate the uncertainties inherent in the development of new business lines and business strategies; |
• | meet the closing conditions to the Business Combination, including approval by stockholders of SWAG and Nogin on the expected terms and schedule; |
• | realize the benefits expected from the proposed Business Combination; |
• | develop, design, and sell services that are differentiated from those of competitors; |
• | anticipate the impact of the coronavirus disease 2019 (“COVID-19”) pandemic and its effect on business and financial conditions; |
• | manage risks associated with operational changes in response to the COVID-19 pandemic; |
• | retain and hire necessary employees; |
• | attract, train and retain effective officers, key employees or directors; |
• | enhance future operating and financial results; |
• | comply with laws and regulations applicable to its business; |
• | stay abreast of modified or new laws and regulations applying to its business, including copyright and privacy regulation; |
• | anticipate the impact of, and response to, new accounting standards; |
• | anticipate the significance and timing of contractual obligations; |
• | maintain key strategic relationships with partners and customers; |
• | respond to uncertainties associated with product and service development and market acceptance; |
• | successfully defend litigation; |
• | upgrade and maintain information technology systems; |
• | access, collect and use personal data about consumers; |
• | acquire and protect intellectual property; |
• | anticipate rapid technological changes; |
• | meet future liquidity requirements and comply with restrictive covenants related to long-term indebtedness; |
• | maintain the listing on, or the delisting of SWAG’s or the Post Combination Company’s securities from, Nasdaq or an inability to have our securities listed on the Nasdaq or another national securities exchange following the Business Combination; |
• | effectively respond to general economic and business conditions; |
• | obtain additional capital, including use of the debt market; and |
• | successfully deploy the proceeds from the Business Combination. |
• | any delay in closing of the Business Combination; |
• | risks related to disruption of management’s time from ongoing business operations due to the proposed transactions; |
• | litigation, complaints, product liability claims and/or adverse publicity; |
• | privacy and data protection laws, privacy or data breaches, or the loss of data; |
• | the impact of changes in consumer spending patterns, consumer preferences, local, regional and national economic conditions, crime, weather, demographic trends and employee availability; |
• | the impact of the COVID-19 pandemic on the financial condition and results of operations of SWAG and Nogin; and |
• | any defects in new products or enhancements to existing products. |
• | attract new customers and retain and increase sales to existing customers; |
• | maintain and expand our relationships with our customers; |
• | develop our existing CaaS platform and introduce new functionality to our CaaS platform; and |
• | expand into new market segments and internationally; |
• | Nogin has a history of high revenue growth each year, which has been driven by customer acquisition along with existing customer growth, both of which management believes to be effective and scalable. |
• | For the existing client base, there is a history of year-over-year GMV growth that management expects to continue. In addition, most clients have multi-year contracts with renewal options. |
• | Projected revenues are also based on assumptions of new deal acquisitions which are driven by the sales team’s quotas along with varying average deal sizes. |
• | Nogin is currently developing new products that will allow the company to reach a larger market and allow the company to meet the individual needs of more prospective clients. |
• | Nogin includes a discount factor on all existing customers to account for customer churn and discounts on renewals. |
• | Assessments of headcount requirements, including headcount for sales and marketing to drive the expected revenue growth from new deal acquisitions and the corresponding headcount required to support those new customers along with support for new product offerings. |
• | Efficiencies of scale that occur as revenue increases along with efficiencies Nogin expects to realize from technology improvements allowing increased utilization from existing headcount. |
• | Other key assumptions impacting profitability include administrative infrastructure, capital expenditures, investment in technology associated with new product development and investment in sales and marketing. |
• | grow our current customer base; |
• | acquire new customers; |
• | scale our business model; |
• | expand our customer location footprint; |
• | build on our success in payments and financial solutions; |
• | expand our presence within verticals; and |
• | selectively pursue strategic and value-enhancing acquisitions. |
• | the effectiveness of our sales force as we hire and train our new salespeople to sell large enterprise customers; |
• | the discretionary nature of purchasing and budget cycles and decisions; |
• | the obstacles placed by customers’ procurement process; |
• | economic conditions and other factors impacting customer budgets; |
• | customers’ integration complexity; |
• | customers’ familiarity with CaaS ecommerce solutions; |
• | customers’ evaluation of competing products during the purchasing process; and |
• | evolving customer demands. |
• | issue additional equity securities that would dilute our stockholders; |
• | use cash that we may need in the future to operate our business; |
• | incur debt on terms unfavorable to us or that we are unable to repay; |
• | incur large charges or substantial liabilities; |
• | encounter difficulties retaining key employees of the acquired company or integrating diverse software codes or business cultures; and |
• | become subject to adverse tax consequences, substantial depreciation, or deferred compensation charges. |
• | the impact of the COVID-19 pandemic on our financial condition and the results of operations; |
• | our operating and financial performance and prospects; |
• | our quarterly or annual earnings or those of other companies in our industry compared to market expectations; |
• | conditions that impact demand for our products and/or services; |
• | future announcements concerning our business, our clients’ businesses or our competitors’ businesses; |
• | the public’s reaction to our press releases, other public announcements and filings with the SEC; |
• | the market’s reaction to our reduced disclosure and other requirements as a result of being an “emerging growth company” under the Jumpstart Our Business Startups Act (the “JOBS Act”); |
• | the size of our public float; |
• | coverage by or changes in financial estimates by securities analysts or failure to meet their expectations; |
• | market and industry perception of our success, or lack thereof, in pursuing our growth strategy; |
• | strategic actions by us or our competitors, such as acquisitions or restructurings; |
• | changes in laws or regulations which adversely affect our industry or us; |
• | privacy and data protection laws, privacy or data breaches, or the loss of data; |
• | changes in accounting standards, policies, guidance, interpretations or principles; |
• | changes in senior management or key personnel; |
• | issuances, exchanges or sales, or expected issuances, exchanges or sales of our capital stock; |
• | changes in our dividend policy; |
• | adverse resolution of new or pending litigation against us; and |
• | changes in general market, economic and political conditions in the United States and global economies or financial markets, including those resulting from natural disasters, terrorist attacks, acts of war and responses to such events. |
• | a limited availability of market quotations for the Post-Combination Company’s securities; |
• | reduced liquidity for the Post-Combination Company’s securities; |
• | a determination that the Post-Combination Company’s common stock is a “penny stock” which will require brokers trading in the Post-Combination Company’s common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for shares of the Post-Combination Company’s common stock; |
• | a limited amount of analyst coverage; and |
• | a decreased ability to issue additional securities or obtain additional financing in the future. |
• | Nogin or SWAG may experience negative reactions from the financial markets, including negative impacts on its stock price (including to the extent that the current market price reflects a market assumption that the Business Combination will be completed); |
• | Nogin may experience negative reactions from its customers, resellers, vendors and employees; |
• | Nogin and SWAG will have incurred substantial expenses and will be required to pay certain costs relating to the Business Combination, whether or not the Business Combination is completed; and |
• | since the Merger Agreement restricts the conduct of Nogin’s and SWAG’s businesses prior to completion of the Business Combination, each of Nogin and SWAG may not have been able to take certain actions during the pendency of the Business Combination that would have benefitted it as an independent company, and the opportunity to take such actions may no longer be available (see the section entitled “The Merger Agreement—Covenants and Agreements” beginning on page 216 of this proxy statement/prospectus for a description of the restrictive covenants applicable to Nogin and SWAG). |
• | a staggered board, which means that our board of directors is classified into three classes of directors with staggered three-year terms and directors are only able to be removed from office for cause; |
• | limitations on convening special stockholder meetings, which could make it difficult for our stockholders to adopt desired governance changes; |
• | a prohibition on stockholder action by written consent, which means that our stockholders will only be able to take action at a meeting of stockholders and will not be able to take action by written consent for any matter; |
• | a forum selection clause, which means certain litigation against us can only be brought in Delaware; |
• | the authorization of undesignated preferred stock, the terms of which may be established and shares of which may be issued without further action by our stockholders; and |
• | advance notice procedures, which apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders. |
• | The automatic conversion of Nogin’s redeemable convertible Series A and Series B preferred stock to Nogin Common Stock; |
• | The net settlement of Nogin’s outstanding warrants for Nogin Common Stock via cashless exercise; |
• | The repayment of Nogin debt; |
• | The PIPE Subscription Agreements entered into by SWAG with various investors to purchase Convertible Notes and PIPE Warrants for an aggregate purchase price of $65.0 million; and |
• | The merger between Nogin and Merger Sub, a wholly owned subsidiary of SWAG, with Nogin surviving the merger as a wholly owned subsidiary of SWAG (together, the “Merger”). |
• | Assuming “No Redemptions”: This presentation assumes that no public shareholders exercise their right to have their public shares converted into their pro rata share of the Trust Account; |
• | Assuming “Maximum Redemptions”: This presentation assumes that approximately 22.8 million public shares are redeemed, resulting in an aggregate payment of approximately $231.5 million out of the Trust Account, which is derived from the number of shares that could be redeemed in connection with the Merger at an assumed redemption price of $10.15 per share based on the Trust Account balance as of March 31, 2022 in order to satisfy the minimum Aggregate Transaction Proceeds of $50.0 million. |
• | Nogin’s shareholders will have majority of the voting power under both the No Redemption and Maximum Redemption scenarios |
• | Nogin is expected to appoint the majority of the board of directors of the post-combination company |
• | Nogin’s existing management will comprise the management of the post-combination company |
• | Nogin will comprise the ongoing operations of the post-combination company |
No Redemptions Scenario |
Maximum Redemptions Scenario |
|||||||||||||||
Shares |
Ownership % |
Shares |
Ownership % |
|||||||||||||
Nogin Equity holders |
54.2 | 65.5 | % | 54.2 | 90.2 | % | ||||||||||
Sponsor |
5.7 | 6.9 | % | 5.7 | 9.5 | % | ||||||||||
Transaction Service Providers |
— | — | % | 0.2 | 0.3 | % | ||||||||||
Public Stockholders |
22.8 | 27.6 | % | — | — | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
82.7 |
100.0 |
% |
60.1 |
100.0 |
% | ||||||||||
|
|
|
|
|
|
|
|
Historical |
No Redemptions Scenario |
Maximum Redemptions Scenario |
||||||||||||||||||||||||||||||
SWAG |
Nogin |
Transaction Accounting Adjustments |
Notes |
Pro Forma Combined |
Additional Transaction Accounting Adjustments |
Notes |
Pro Forma Combined |
|||||||||||||||||||||||||
Assets |
||||||||||||||||||||||||||||||||
Current Assets: |
||||||||||||||||||||||||||||||||
Cash and Cash Equivalent |
$ | 90 | $ | 1,345 | $ | 232,577 | [A ] |
$ | 234,012 | $ | (213,012 | ) | [K ] |
$ | 21,000 | |||||||||||||||||
Accounts Receivable, Net |
— | 2,340 | — | 2,340 | — | 2,340 | ||||||||||||||||||||||||||
Related Party Receivables |
— | 5,881 | — | 5,881 | — | 5,881 | ||||||||||||||||||||||||||
Inventory |
— | 18,725 | — | 18,725 | — | 18,725 | ||||||||||||||||||||||||||
Prepaid Expenses and Other Current Assets |
385 | 5,224 | (2,333 | ) | [G] |
3,276 | — | 3,276 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Current Assets |
475 | 33,515 | 230,244 | 264,234 | (213,012 | ) | 51,222 | |||||||||||||||||||||||||
Restricted Cash |
— | 1,500 | — | 1,500 | — | 1,500 | ||||||||||||||||||||||||||
Property and Equipment—Net |
— | 1,747 | — | 1,747 | — | 1,747 | ||||||||||||||||||||||||||
Intangible Assets—Net |
— | 1,054 | — | 1,054 | — | 1,054 | ||||||||||||||||||||||||||
Investment in Unconsolidated Affiliates |
— | 12,537 | — | 12,537 | — | 12,537 | ||||||||||||||||||||||||||
Marketable Securities Held in Trust Account |
231,530 | — | (231,530 | ) | [B ] |
— | — | — | ||||||||||||||||||||||||
Other Non-Current Asset |
92 | 664 | — | 756 | — | 756 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Assets |
$ | 232,097 | $ | 51,017 | $ | (1,286 | ) | $ | 281,828 | $ | (213,012 | ) | $ | 68,816 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Liabilities and Stockholders’ Equity (Deficit) |
||||||||||||||||||||||||||||||||
Current Liabilities: |
||||||||||||||||||||||||||||||||
Accounts Payable |
— | 18,603 | — | 18,603 | — | 18,603 | ||||||||||||||||||||||||||
Due to Clients |
— | 4,874 | — | 4,874 | — | 4,874 | ||||||||||||||||||||||||||
Related Party Payables |
— | 4,015 | — | 4,015 | — | 4,015 | ||||||||||||||||||||||||||
Accrued Expenses and Other Liabilities |
1,917 | 9,585 | (3,657 | ) | [H] |
7,845 | 1,765 | [L] |
9,610 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Current Liabilities |
1,917 | 37,077 | (3,657 | ) | 35,337 | 1,765 | 37,102 | |||||||||||||||||||||||||
Line of Credit |
— | 4,000 | (4,000 | ) | [I] |
— | — | — | ||||||||||||||||||||||||
Long-Term Note Payable |
300 | 19,799 | (20,099 | ) | [I] |
— | — | — | ||||||||||||||||||||||||
Convertible notes |
— | — | 61,780 | [J] |
61,780 | — | 61,780 | |||||||||||||||||||||||||
Deferred tax liabilities |
— | 1,332 | — | 1,332 | — | 1,332 | ||||||||||||||||||||||||||
Other Long-Term Liabilities |
— | 734 | (561 | ) | [F] |
173 | 14,560 | [L] |
14,733 | |||||||||||||||||||||||
Deferred Underwriting Fee Payable |
7,983 | — | (7,983 | ) | [C] |
— | — | — | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Liabilities |
10,200 | 62,942 | 25,480 | 98,622 | 16,325 | 114,947 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Commitments and Contingencies |
||||||||||||||||||||||||||||||||
Series A Convertible |
— | 4,687 | (4,687 | ) | [D ] |
— | — | — | ||||||||||||||||||||||||
Series B Convertible |
— | 6,502 | (6,502 | ) | [D ] |
— | — | — | ||||||||||||||||||||||||
Class A Common Stock Subject to Redemption |
231,500 | — | (231,500 | ) | [D ] |
— | — | — | ||||||||||||||||||||||||
Stockholders’ Equity/(Deficit): |
||||||||||||||||||||||||||||||||
Common Stock |
— | 1 | (1 | ) | [D ] |
— | — | — | ||||||||||||||||||||||||
Class A Common Stock |
— | — | 8 | [D ] |
8 | (2 | ) | [E ] |
6 | |||||||||||||||||||||||
Class B Common Stock |
1 | — | (1 | ) | [D ] |
— | — | — | ||||||||||||||||||||||||
Additional Paid-In Capital |
— | 4,419 | 207,032 | [D ] |
211,451 | (211,451 | ) | [E ] |
— | |||||||||||||||||||||||
Treasury Stock |
— | (1,330 | ) | 1,330 | [D ] |
— | — | — | ||||||||||||||||||||||||
Accumulated Deficit |
(9,604 | ) | (26,204 | ) | 7,555 | [D ] |
(28,253 | ) | (17,884 | ) | [E ] |
(46,137 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Stockholders’ Equity (Deficit) |
(9,603 | ) | (23,114 | ) | 215,923 | 183,206 | (229,337 | ) | (46,131 | ) | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Liabilities and Stockholders’ Equity/ (Deficit) |
$ | 232,097 | $ | 51,017 | $ | (1,286 | ) | $ | 281,828 | $ | (213,012 | ) | $ | 68,816 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Historical |
No Redemptions Scenario |
Maximum Redemptions Scenario |
||||||||||||||||||||||||||||||
SWAG |
Nogin |
Transaction Accounting Adjustments |
Notes |
Pro Forma Combined |
Additional Transaction Accounting Adjustments |
Notes |
Pro Forma Combined |
|||||||||||||||||||||||||
Service Revenue |
$ | — | $ | 8,533 | $ | — | $ | 8,533 | $ | — | $ | 8,533 | ||||||||||||||||||||
Product Revenue |
— | 12,922 | — | 12,922 | — | 12,922 | ||||||||||||||||||||||||||
Revenue from Related Parties |
— | 3,744 | — | 3,744 | — | 3,744 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Revenue |
$ | — | $ | 25,199 | $ | — | $ | 25,199 | $ | — | $ | 25,199 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Operating Costs and Expenses: |
||||||||||||||||||||||||||||||||
Cost of Services |
— | 5,435 | — | 5,435 | — | 5,435 | ||||||||||||||||||||||||||
Cost of Product Revenue |
— | 10,251 | — | 10,251 | — | 10,251 | ||||||||||||||||||||||||||
Sales & Marketing |
— | 566 | — | 566 | — | 566 | ||||||||||||||||||||||||||
Research & Development |
— | 1,577 | — | 1,577 | — | 1,577 | ||||||||||||||||||||||||||
General and Administrative |
1,203 | 17,222 | — | 18,425 | — | 18,425 | ||||||||||||||||||||||||||
Depreciation and Amortization |
— | 201 | — | 201 | — | 201 | ||||||||||||||||||||||||||
Transaction Costs |
— | — | — | — | — | — | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total Operating Costs and Expenses |
1,203 | 35,252 | — | 36,455 | — | 36,455 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Operating Loss |
(1,203 | ) | (10,053 | ) | — | (11,256 | ) | — | (11,256 | ) | ||||||||||||||||||||||
Interest Expense |
— | (652 | ) | (1,178 | ) | [D] |
(1,830 | ) | — | (1,830 | ) | |||||||||||||||||||||
Change in Fair Value of Unconsolidated Affiliates |
— | (1,033 | ) | — | (1,033 | ) | — | (1,033 | ) | |||||||||||||||||||||||
Other Income (Loss) |
23 | 1,954 | — | 1,977 | — | 1,977 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Income (Loss) Before Income Taxes |
(1,180 | ) | (9,784 | ) | (1,178 | ) | (12,142 | ) | — | (12,142 | ) | |||||||||||||||||||||
Provision for Income Tax |
— | 158 | — | 158 | — | 158 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Net Loss |
$ | (1,180 | ) | $ | (9,942 | ) | $ | (1,178 | ) | $ | (12,300 | ) | $ | — | $ | (12,300 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Pro Forma Loss Per Share |
||||||||||||||||||||||||||||||||
Weighted Average Shares of Class A Outstanding—Basic and Diluted |
22,807,868 | — | — | 82,704,972 | — | 60,116,354 | ||||||||||||||||||||||||||
Loss Per Share Class A—Basic and Diluted |
$ | (0.04 | ) | — | $ | (0.15 | ) | — | $ | (0.20 | ) | |||||||||||||||||||||
Weighted Average Shares of Class B Outstanding—Basic and Diluted |
5,701,967 | — | — | — | — | — | ||||||||||||||||||||||||||
Loss Per Share Class B—Basic and Diluted |
$ | (0.04 | ) | — | — | — | — | |||||||||||||||||||||||||
Weighted Average Common Shares Outstanding—Basic and Diluted |
— | 9,129,358 | — | — | — | — | ||||||||||||||||||||||||||
Loss Per Common Share—Basic and Diluted |
— | $ | (1.09 | ) | — | — | — | — |
Historical |
No Redemptions Scenario |
Maximum Redemptions Scenario |
||||||||||||||||||||||||||||||
SWAG (Historical from 1/5/21 through 12/31/21) |
Nogin |
Transaction Accounting Adjustments |
Notes |
Pro Forma Combined |
Additional Transaction Accounting Adjustments |
Notes |
Pro Forma Combined |
|||||||||||||||||||||||||
Service Revenue |
$ | — | $ | 41,866 | $ | — | $ | 41,866 | $ | — | $ | 41,866 | ||||||||||||||||||||
Product Revenue |
— | 51,346 | — | 51,346 | — | 51,346 | ||||||||||||||||||||||||||
Revenue from Related Parties |
— | 8,136 | — | 8,136 | — | 8,136 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Revenue |
$ | — | $ | 101,348 | $ | — | $ | 101,348 | $ | — | $ | 101,348 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Operating Costs and Expenses: |
||||||||||||||||||||||||||||||||
Cost of Services |
— | 24,174 | — | 24,174 | — | 24,174 | ||||||||||||||||||||||||||
Cost of Product Revenue |
20,431 | — | 20,431 | 20,431 | ||||||||||||||||||||||||||||
Sales & Marketing |
— | 1,772 | — | 1,772 | — | 1,772 | ||||||||||||||||||||||||||
Research & Development |
— | 5,361 | — | 5,361 | — | 5,361 | ||||||||||||||||||||||||||
General and Administrative |
1,917 | 55,369 | — | 57,286 | — | 57,286 | ||||||||||||||||||||||||||
Depreciation and Amortization |
— | 520 | — | 520 | — | 520 | ||||||||||||||||||||||||||
Transaction Costs |
— | — | 3,578 | [A] |
3,578 | 3,578 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total Operating Costs and Expenses |
1,917 | 107,627 | 3,578 | 113,122 | — | 113,122 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Operating Loss |
(1,917 | ) | (6,279 | ) | (3,578 | ) | (11,774 | ) | — | (11,774 | ) | |||||||||||||||||||||
Interest Expense |
— | (926 | ) | (6,394 | ) | [C] |
(7,320 | ) | — | (7,320 | ) | |||||||||||||||||||||
Change in Fair Value of Unconsolidated Affiliates |
— | 4,937 | — | 4,937 | — | 4,937 | ||||||||||||||||||||||||||
Other Income (Loss) |
(37 | ) | 3,378 | (2,049 | ) | [B] |
1,292 | — | 1,292 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Income (Loss) Before Income Taxes |
(1,954 | ) | 1,110 | (12,021 | ) | (12,865 | ) | — | (12,865 | ) | ||||||||||||||||||||||
Provision for Income Tax |
— | 1,175 | — | 1,175 | — | 1,175 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Net Loss |
$ | (1,954 | ) | $ | (65 | ) | $ | (12,021 | ) | $ | (14,040 | ) | $ | — | $ | (14,040 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Pro Forma Loss Per Share |
||||||||||||||||||||||||||||||||
Weighted Average Shares of Class A Outstanding—Basic and Diluted |
10,024,409 | — | — | 82,704,972 | — | 60,116,354 | ||||||||||||||||||||||||||
Loss Per Share Class A—Basic and Diluted |
$ | (0.13 | ) | — | $ | (0.17 | ) | — | $ | (0.23 | ) | |||||||||||||||||||||
Weighted Average Shares of Class B Outstanding—Basic and Diluted |
5,304,936 | — | — | — | — | — | ||||||||||||||||||||||||||
Loss Per Share Class B—Basic and Diluted |
$ | (0.13 | ) | — | — | — | — | |||||||||||||||||||||||||
Weighted Average Common Shares Outstanding—Basic and Diluted |
— | 9,129,358 | — | — | — | — | ||||||||||||||||||||||||||
Loss Per Common Share—Basic and Diluted |
— | $ | (0.01 | ) | — | — | — | — |
1. |
Description of the Business Combination |
2. |
Basis of Presentation |
3. |
Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet as of March 31, 2022 |
No Redemptions Scenario |
||||
Reclass of SWAG Cash Held in Trust Account |
$ | 231,530 | ||
PIPE Investment Proceeds |
65,000 | |||
Cash to Existing Nogin Equity Holders |
(15,000 | ) | ||
Nogin Transaction Costs (1) |
(8,000 | ) | ||
SWAG Transaction Costs (2) |
(15,253 | ) | ||
Payment of Debt (3) |
(25,700 | ) | ||
|
|
|||
Pro Forma Adjustment to Cash |
$ | 232,577 | ||
|
|
(1) | Represents the payment of estimated non-recurring direct and incremental transaction costs incurred by Nogin in connection with the Merger. Costs include legal, financial advisory, and other professional fees related to the Merger. Payment includes $2.3 million of transaction costs that were accrued as of March 31, 2022. |
(2) | Reflects the payment of estimated non-recurring direct and incremental transaction costs incurred by SWAG in connection with the Merger. Costs include legal, financial advisory, and other professional fees related to the Merger. Payment includes $8.0 million of deferred underwriting costs in connection with the SWAG IPO that is payable upon consummation of the Merger that are accrued as of March 31, 2022. Also includes $1.9 million in fees associated with the PIPE Investment that have been capitalized with the associated PIPE Convertible Debt as well as $1.8 million of transaction costs that were accrued as of March 31, 2022. |
(3) | Reflects the payment of Nogin’s outstanding notes payable of $20.0 million, exit payment of $1.0 million and early termination payment of $0.5 million on the notes payable and the payment of $4.0 million on Nogin’s line of credit. In addition, reflects payment of SWAG related party promissory notes of $0.3 million that are due upon consummation of the Merger. |
Adjustments to SWAG Equity (1) |
Adjustments to Nogin Equity (2) |
Recapitalization Adjustments (3) |
Other items (4) |
Pro forma adjustments |
||||||||||||||||
SWAG Class A Redeemable Common Stock |
$ | (231,500 | ) | $ | — | $ | — | $ | — | $ | (231,500 | ) | ||||||||
Nogin Preferred Series A |
— | (4,687 | ) | — | — | (4,687 | ) | |||||||||||||
Nogin Preferred Series B |
— | (6,502 | ) | — | — | (6,502 | ) | |||||||||||||
Shareholders’ Equity: |
||||||||||||||||||||
Common Stock |
— | — | (1 | ) | — | (1 | ) | |||||||||||||
Class A Common Stock |
3 | — | 5 | — | 8 | |||||||||||||||
Class B Common Stock |
(1 | ) | — | — | — | (1 | ) | |||||||||||||
Additional Paid-In Capital |
218,316 | 10,420 | (4 | ) | (21,700 | ) | 207,032 | |||||||||||||
Treasury Stock |
— | 1,330 | — | — | 1,330 | |||||||||||||||
Accumulated Deficit |
9,604 | — | — | (2,049 | ) | 7,555 |
(1) | Represents the adjustments to SWAG’s mezzanine equity and shareholders’ equity as follows: |
• | The reclassification of historical SWAG Class A Common Stock subject to possible redemption from mezzanine equity to permanent equity immediately prior to the consummation of the Merger. Impact of $2 thousand to Class A Common Stock and $231.5 million to additional paid in capital. |
• | The conversion of SWAG Class B Common Stock to shares of SWAG Class A Common Stock for $1 thousand immediately prior to the consummation of the Merger. |
• | Reflects the reclassification of SWAG historical accumulated deficit of $9.6 million to additional paid in capital in connection with the consummation of the Merger. The reduction to additional paid-in capital of $13.2 million also includes $3.6 million of additional estimated non-recurring incremental transaction costs incurred by SWAG in connection with the Merger. |
(2) | Represents the adjustments to Nogin’s mezzanine equity and shareholders’ equity as follows: |
(3) | Represents recapitalization of Nogin’s equity and issuance of 54.2 million shares of SWAG’s Class A Common Stock to Nogin Stockholders as consideration for the reverse recapitalization |
(4) | Other adjustments to additional paid in capital and accumulated deficit are as follows: |
• | A reduction to additional paid in capital of $15.0 million paid to Nogin Equityholders as consideration for the reverse recapitalization |
• | A reduction to additional paid in capital of $8.0 million of estimated transaction costs incurred by Nogin in connection with the Merger that are incremental and non-recurring. The $8.0 million of estimated transaction costs includes $2.3 million of transaction costs that were deferred as of March 31, 2022. |
• | An increase to additional paid in capital of $1.3 million related to the PIPE Warrants issued in connection with the PIPE subscription. |
• | Reflects an increase to accumulated deficit of $2.0 million related to debt extinguishment costs as a result of the payment of Nogin’s outstanding debt at close of the Merger. |
[E] | Reflects the redemption of 22.8 million Public Shares under the Maximum Redemptions scenario for aggregate payment of $231.5 million based on a redemption price of approximately $10.15 per share offset by the issuance of 219,250 shares of Class A Common Stock to SWAG and Nogin financial advisors to settle transaction costs of $2.2 million. These adjustments were allocated to Class A Common Stock of $2 thousand based on a par value of $0.0001, $211.4 million to additional paid in capital and the remaining $17.9 million to accumulated deficit as a result of additional paid in capital being reduced to $0. |
[F] | In connection with the Merger, the Nogin outstanding warrants will be net settled via a cashless exercise into Nogin Common Stock immediately prior to the consummation of the Merger. As a result, the liability classified warrants with a fair value of $0.6 million as of March 31, 2022 was reclassified to additional paid- in capital. |
[G] | Adjustment relates to the reversal of Nogin transaction costs that were deferred as of March 31, 2022 in connection with the Merger that is accounted for as a reverse recapitalization and recorded to additional paid in capital upon consummation of the Merger. |
[H] | The reduction to accrued expenses of $3.7 million relates to the payment of Nogin transaction costs of $2.3 million and SWAG transactions costs of $1.8 million upon consummation of the Merger that were accrued |
as of March 31, 2022. This is offset by the write-off of $0.4 million of the current portion of the unamortized debt discount and debt issuance costs that are included in Nogin’s historical accrued expenses and other liabilities as of March 31, 2022 and are written-off as a result of the paydown of Nogin debt at close of the Merger. |
[I] | Reflects the payment of Nogin outstanding debt and SWAG outstanding related party promissory notes upon consummation of the Merger. Includes the payment of $21.0 million of outstanding notes payable (inclusive of exit payments) offset by $1.2 million write-off of unamortized debt discount and issuance costs associated with the Nogin notes payable (additional write-off of $0.4 million of unamortized debt discount and issuance costs is included in accrued expenses and other liabilities adjustment – see note [H]). |
[J] | Represents the gross proceeds from the issuance of the PIPE Convertible Debt of $65.0 million, net of $1.9 million related to the fees associated with the PIPE Convertible Debt and net of $1.3 million related to the PIPE Warrants that were issued for no additional consideration in conjunction with the PIPE Convertible Debt. For purposes of the pro forma financial information, the PIPE Convertible Debt has been accounted for as a single debt instrument that does not have a separable derivative associated with the conversion feature. The PIPE Warrants have similar terms to the Private Placement Warrants in which the fair value was determined based on the $1 per Warrant fair value at which the Private Placement Warrants were issued and are expected to be equity classified. As a result, the 1.3 million PIPE Warrants are being treated as a discount to the PIPE Convertible Notes for $1.3 million with a corresponding increase to additional paid in capital of $1.3 million. None of the fees associated with the PIPE Investment were allocated to the PIPE Warrants as the impact would be de minimis. |
[K] | The following represents the additional pro forma adjustment to cash under the Maximum Redemptions scenario. Under the Maximum Redemptions scenario $18.5 million of the $23.3 million estimated total transaction costs of SWAG and Nogin will be deferred at close of the Merger. |
Maximum Redemptions |
||||
Payment to redeeming shareholders (note [E]) |
$ | (231,530 | ) | |
Deferred transaction costs (note [L]) |
18,518 | |||
|
|
|||
Pro Forma Adjustment to Cash |
$ | (213,012 | ) | |
|
|
[L] | Reflects the additional transaction adjustment under the Maximum Redemptions scenario to accrued expenses and other liabilities and other long-term liabilities. Of the total $23.3 million estimated transaction costs, $17.3 million relates to banker advisory fees (financial advisory, PIPE placement and deferred IPO) and $6.0 million relates to non-banker advisory fees (legal and accounting). |
4. |
Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations for the Three Months Ended March 31, 2022 and the Year Ended December 31, 2021 |
[A] | Reflects SWAG’s additional estimated non-recurring, incremental transaction related costs of $3.6 million in connection with the Merger as if it was consummated on January 1, 2021. Costs include legal, financial advisory, and other professional fees related to the Merger. Adjustment does not include $0.8 million and $1.0 million of SWAG transaction costs that were already incurred and recognized in the SWAG historical statements of operations for the three months ended March 31, 2022 and the year ended December 31, 2021, respectively. |
[B] | Reflects the debt extinguishment costs associated with the payment of Nogin’s debt upon consummation of the Merger. Includes the write-off of $1.5 million of unamortized debt discounts and issuance costs as well as $0.5 million associated with early termination payment. |
[C] | Reflects the net pro forma adjustment to interest expense for the year ended December 31, 2021 of $6.4 million as if the Merger was consummated on January 1, 2021. Includes $7.3 million of interest expense associated with the Convertible Notes, which is based on, a $4.5 million interest expense for the 7.00% interest on the $65.0 million aggregate principal amount of Convertible Notes, a $2.0 million interest expense related to the annual accretion of principal on the Convertible Notes expected in the first twelve months, and amortization of the debt discount and issuance costs of $0.8 million based on straight line amortization. This is offset by the removal of $0.9 million of historical Nogin interest expense as a result of the payment of Nogin’s debt upon consummation of the Merger. |
[D] | Reflects the net pro forma adjustment to interest expense for the three months ended March 31, 2022 of $1.2 million as if the Merger was consummated on January 1, 2021. Includes $1.8 million of interest expense associated with the Convertible Notes, which is based on, a $1.1 million interest expense for the 7.00% interest on the $65.0 million aggregate principal amount of Convertible Notes, a $0.5 million interest expense related to the three month accretion of principal on the Convertible Notes and amortization of the debt discount and issuance costs of $0.2 million based on straight line amortization. This is offset by the removal of $0.6 million of historical Nogin interest expense as a result of the payment of Nogin’s debt upon consummation of the Merger. |
5. |
Pro Forma Loss Per Share Information |
Year Ended December 31, 2021 |
||||||||
No Redemptions Scenario |
Maximum Redemptions Scenario |
|||||||
Net loss |
$ | (14,040 | ) | $ | (14,040 | ) | ||
Weighted Average Shares Outstanding—Basic and Diluted |
82,704,972 | 60,116,354 | ||||||
Loss Per Share—Basic and Diluted |
$ | (0.17 | ) | $ | (0.23 | ) |
Three Months Ended March 31, 2022 |
||||||||
No Redemptions Scenario |
Maximum Redemptions Scenario |
|||||||
Net loss |
$ | (12,300 | ) | $ | (12,300 | ) | ||
Weighted Average Shares Outstanding—Basic and Diluted |
82,704,972 | 60,116,354 | ||||||
Loss Per Share—Basic and Diluted |
$ | (0.15 | ) | $ | (0.20 | ) |
• | Assuming No Redemptions |
• | Assuming Maximum Redemptions |
Historical |
No Redemptions Scenario |
Maximum Redemptions Scenario |
||||||||||||||
As of and For the Three Months Ending March 31, 2022 |
SWAG |
Nogin |
Pro Forma Combined |
Pro Forma Combined |
||||||||||||
Pro Forma Loss Per Share |
||||||||||||||||
Weighted Average Shares of Class A Outstanding—Basic and Diluted |
22,807,868 | — | 82,704,972 | 60,116,354 | ||||||||||||
Loss Per Share Class A—Basic and Diluted |
$ | (0.04 | ) | — | $ | (0.15 | ) | $ | (0.20 | ) | ||||||
Weighted Average Shares of Class B Outstanding—Basic and Diluted |
5,701,967 | — | — | — | ||||||||||||
Loss Per Share Class B—Basic and Diluted |
$ | (0.04 | ) | — | — | — | ||||||||||
Weighted Average Common Shares Outstanding—Basic and Diluted |
— | 9,129,358 | — | — | ||||||||||||
Loss Per Common Share—Basic and Diluted |
— | $ | (1.09 | ) | — | — | ||||||||||
Book Value Per Share |
$ | (1.68 | ) | $ | (2.53 | ) | $ | 2.22 | $ | (0.77 | ) |
Historical |
No Redemptions Scenario |
Maximum Redemptions Scenario |
||||||||||||||
For the Year Ending December 31, 2021 |
SWAG (Historical from 1/5/21 through 12/31/21) |
Nogin |
Pro Forma Combined |
Pro Forma Combined |
||||||||||||
Pro Forma Loss Per Share |
||||||||||||||||
Weighted Average Shares of Class A Outstanding—Basic and Diluted |
10,024,409 | — | 82,704,972 | 60,116,354 | ||||||||||||
Loss Per Share Class A—Basic and Diluted |
$ | (0.13 | ) | $ | — | $ | (0.17 | ) | $ | (0.23 | ) | |||||
Weighted Average Shares of Class B Outstanding—Basic and Diluted |
5,304,936 | — | — | — | ||||||||||||
Loss Per Share Class B—Basic and Diluted |
$ | (0.13 | ) | — | — | — | ||||||||||
Weighted Average Common Shares Outstanding—Basic and Diluted |
— | 9,129,358 | — | — | ||||||||||||
Loss Per Common Share—Basic and Diluted |
— | (0.01 | ) | — | — |
• | The Business Combination Proposal |
• | The Charter Approval Proposal— Annex B |
• | The Governance Proposal non-binding advisory basis, a separate proposal with respect to certain governance provisions in the Proposed Charter in accordance with SEC requirements; |
• | The Director Election Proposal |
• | The Nasdaq Proposal— Post-Combination Company, reflecting the portion of transaction fees to be settled in shares of the Post-Combination Company in lieu of cash to the Advisors for their respective engagements with Nogin and SWAG if SWAG Public Stockholders redeem 80% or more of the Public Shares; |
• | The Incentive Plan Proposal— |
• | The Adjournment Proposal— |
• | If the Business Combination with Nogin or another business combination is not consummated within the Completion Window, SWAG will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding Public Shares for cash and, subject to the approval of its remaining stockholders and the SWAG Board, dissolving and liquidating. In such event, the 5,701,967 Founder Shares held by the Initial Stockholders which were acquired for an aggregate purchase price of $25,000 prior to the SWAG IPO, would be worthless because the Initial Stockholders are not entitled to participate in any redemption or distribution with respect to such shares. Such shares had an aggregate market value of $ based upon the closing price of $ per share of Class A Common Stock on the Nasdaq on , 2022, the SWAG Record Date. Certain Founder Shares are subject to certain time- and performance-based vesting provisions as described under “ Other Agreements—Sponsor Agreement. |
• | The Sponsor purchased an aggregate of 9,982,754 Private Placement Warrants from SWAG for an aggregate purchase price of $9,982,754 (or $1.00 per warrant). These purchases took place on a private placement basis simultaneously with the consummation of the SWAG IPO. A portion of the proceeds SWAG received from these purchases were placed in the Trust Account. Such warrants had an aggregate market value of $ based upon the closing price of $ per public warrant on the Nasdaq on , 2022, the SWAG Record Date. The Private Placement Warrants will become worthless if SWAG does not consummate a business combination within the Completion Window. |
• | SWAG’s directors and officers, and their affiliates are entitled to reimbursement of out-of-pocket |
• | The continued indemnification of current directors and officers and the continuation of directors’ and officers’ liability insurance. |
• | via the Internet; |
• | by telephone; |
• | by submitting a properly executed proxy card or voting instruction form by mail; or |
• | electronically at the Special Meeting. |
1. | you may send another proxy card with a later date; |
2. | you may notify SWAG’s Secretary in writing before the Special Meeting that you have revoked your proxy; or |
3. | you may attend the Special Meeting and vote electronically by visiting and entering the control number found on your proxy card, instruction form or notice you previously received. Attendance at the Special Meeting will not, in and of itself, revoke a proxy. |
• | Changes to Authorized Capital Stock — |
• | Required Vote to Amend the Charter — two-thirds (66 and 2/3%) of the voting power of all the then outstanding shares of voting stock of the Post-Combination Company, voting together as a single class, to amend, alter, repeal or rescind, in whole or in part, certain provisions of the Proposed Charter; |
• | Required Vote to Amend the Bylaws — two-thirds (66 and 2/3%) of the voting power of all the then outstanding shares of voting stock of the Post-Combination Company entitled to vote generally in an election of directors to adopt, amend, alter, repeal or rescind the Amended and Restated Bylaws; |
• | Director Removal — two-thirds (66 and 2/3%) of the voting power of all of the then outstanding shares of voting stock of the Post-Combination Company entitled to vote at an election of directors; |
• | Classified Board — |
• | Removal of Blank Check Company Provisions — |
• | Stock Options and SARs |
• | Restricted Stock of non-transferable shares of the Post-Combination Company’s common stock that are subject to certain vesting conditions and other restrictions. |
• | RSUs |
• | Other Stock or Cash Based Awards |
• | Dividend Equivalents |
• | Non-Qualified Stock Options. |
• | Incentive Stock Options. |
• | Other Awards. NSOs; non-transferable restricted stock subject to a substantial risk of forfeiture results in income recognition equal to the excess of the fair market value over the price paid, if any, only at the time the restrictions lapse (unless the recipient elects to accelerate recognition as of the date of grant through a Section 83(b) election); RSUs, dividend equivalents and other stock or cash based awards are generally subject to tax at the time of payment. We or our subsidiaries or affiliates generally should be entitled to a federal income tax deduction at the time and for the same amount as the optionee recognizes ordinary income. |
Plan Category |
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights |
Weighted Average Exercise Price of Outstanding Options, Warrants and Rights |
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans |
|||||||||
Equity compensation plans approved by security holders |
— | — | — | |||||||||
Equity compensation plans not approved by security holders |
— | — | — |
Name |
Age |
Title | ||||
Jonathan S. Huberman |
56 | Chairman, Chief Executive Officer and Chief Financial Officer | ||||
Mike Nikzad |
58 | Vice President of Acquisitions and Director | ||||
Andrew K. Nikou |
44 | Director | ||||
C. Matthew Olton |
55 | Director | ||||
Stephanie Davis |
57 | Director | ||||
Steven Guggenheimer |
56 | Director | ||||
Dr. Peter H. Diamandis |
60 | Director |
• | the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm engaged by us; |
• | pre-approving all audit and permitted non-audit services to be provided by the independent registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; |
• | setting clear hiring policies for employees or former employees of the independent registered public accounting firm, including but not limited to, as required by applicable laws and regulations; |
• | setting clear policies for audit partner rotation in compliance with applicable laws and regulations; |
• | obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (i) the independent registered public accounting firm’s internal quality-control procedures, (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues and (iii) all relationships between the independent registered public accounting firm and us to assess the independent registered public accounting firm’s independence; |
• | reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and |
• | reviewing with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities. |
• | reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, if any is paid by us, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation; |
• | reviewing and approving on an annual basis the compensation, if any is paid by us, of all of our other officers; |
• | reviewing on an annual basis our executive compensation policies and plans; |
• | implementing and administering our incentive compensation equity-based remuneration plans; |
• | assisting management in complying with our proxy statement and annual report disclosure requirements; |
• | approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees; |
• | if required, producing a report on executive compensation to be included in our annual proxy statement; and |
• | reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors. |
Plan Category |
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights |
Weighted Average Exercise Price of Outstanding Options, Warrants and Rights |
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans |
|||||||||
Equity compensation plans approved by security holders |
— | — | — | |||||||||
Equity compensation plans not approved by security holders |
— | — | — |
Three Months Ended March 31, 2022 (unaudited) |
Period from January 5, 2021 (inception) through December 31, 2021 (audited) |
|||||||
Statement of Operations Data: |
||||||||
Operating and formation costs |
$ | 1,203,180 | $ | 1,917,009 | ||||
Net loss |
$ | (1,179,868 | ) | $ | (1,954,091 | ) | ||
Earnings Per Share Data: |
||||||||
Weighted Average Share of Class A Outstanding—Basic and Diluted |
22,807,868 | 10,024,409 | ||||||
Loss Per Share Class A—Basic and Diluted |
$ | (0.04 | ) | $ | (0.13 | ) | ||
Weighted Average Shares of Class B Outstanding—Basic and Diluted |
5,701,967 | 5,304,936 | ||||||
Loss Per Share Class B—Basic and Diluted |
$ | (0.04 | ) | $ | (0.13 | ) |
As of March 31, 2022 (unaudited) |
As of December 31, 2021 (audited) |
|||||||
Balance Sheet Data: |
||||||||
Working capital |
$ | (1,412,378 | ) | $ | (440,843 | ) | ||
Total assets |
232,096,724 | 232,365,298 | ||||||
Total liabilities |
10,200,329 | 9,289,035 | ||||||
Stockholders’ deficit |
(9,603,465 | ) | (8,423,597 | ) |
• | each person who is, or is expected to be, the beneficial owner of more than 5% of the outstanding shares of common stock of SWAG or the Post-Combination Company, as applicable; |
• | each of SWAG’s current directors and executive officers; |
• | each person who will become a director or executive officer of the Post-Combination Company; and |
• | all directors and officers of SWAG, as a group, and of the Post-Combination Company, as a group. |
Before the Business Combination |
After the Business Combination |
|||||||||||||||||||||||||||||||
Class A |
Class B |
Assuming No Redemption |
Assuming Maximum Redemption of Public Shares |
|||||||||||||||||||||||||||||
Number of Shares Beneficially Owned |
Percentage of Class |
Number of Shares Beneficially Owned (2) |
Percentage of Class |
Number of Shares Beneficially Owned |
Percentage of Class |
Number of Shares Beneficially Owned (2) |
Percentage of Class |
|||||||||||||||||||||||||
Name of Beneficial Owner |
||||||||||||||||||||||||||||||||
Principal Stockholders: |
||||||||||||||||||||||||||||||||
Software Acquisition Holdings III LLC (1) |
— | — | 5,701,967 | 100 | % | 5,701,967 | 6.9 | % | 5,701,967 | 9.5 | % | |||||||||||||||||||||
Directors and Named Executive Officers of SWAG: |
||||||||||||||||||||||||||||||||
Jonathan Huberman (2) |
— | — | 5,701,967 | 100 | % | 5,701,967 | 6.9 | % | 5,701,967 | 9.5 | % | |||||||||||||||||||||
Mike Nikzad (2) |
— | — | 5,701,967 | 100 | % | 5,701,967 | 6.9 | % | 5,701,967 | 9.5 | % | |||||||||||||||||||||
Andrew K. Nikou (2) |
— | — | 5,701,967 | 100 | % | 5,701,967 | 6.9 | % | 5,701,967 | 9.5 | % | |||||||||||||||||||||
C. Matthew Olton |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Stephanie Davis |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Steven Guggenheimer |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Dr. Peter H. Diamandis |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Directors and executive officers of SWAG as a group (7 individuals) |
— | — |
5,701,967 |
100 |
% |
5,701,967 |
6.9 |
% |
5,701,967 |
9.5 |
% | |||||||||||||||||||||
Directors and Executive Officers of the Post-Combination Company: |
||||||||||||||||||||||||||||||||
Jan-Christopher Nugent (3) |
— | — | — | — | 12,337,590 | 14.9 | % | 12,337,590 | 20.5 | % | ||||||||||||||||||||||
Jonathan Huberman (2) |
— | — | 5,701,967 | 100 | % | 5,725,271 | 6.9 | % | 5,725,271 | 9.5 | % | |||||||||||||||||||||
Geoffrey Van Haeren (4) |
— | — | — | — | 5,958,684 | 7.2 | % | 5,958,684 | 9.9 | % | ||||||||||||||||||||||
Wilhelmina Fader |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Eileen Moore Johnson |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Michael Lin (5) |
— | — | — | — | 927 | * | 927 | * | ||||||||||||||||||||||||
Directors and Executive Officers of the Post-Combination Company as a group (6 individuals) |
— | — |
5,701,967 |
100 |
% |
24,022,472 |
29.0 |
% |
24,022,472 |
40.0 |
% | |||||||||||||||||||||
5% Holders of the Post-Combination Company: |
||||||||||||||||||||||||||||||||
Iron Gate Branded Online, LLC (6) |
— | — | — | — | 14,764,172 | 17.9 | % | 14,764,172 | 24.6 | % | ||||||||||||||||||||||
Stephen Choi |
— | — | — | — | 15,005,882 | 18.1 | % | 15,005,882 | 25.0 | % |
* | Less than one percent. |
1. | The Sponsor is the record holder of such shares. The Sponsor is controlled by a board of managers which consists of Jonathan Huberman, SWAG’s Chairman, Chief Executive Officer and Chief Financial Officer, Mike Nikzad, SWAG’s Vice President of Acquisitions and a director, and Andrew Nikou, one of SWAG’s directors. As such, they have voting and investment discretion with respect to the SWAG Common Stock held of record by the Sponsor and may be deemed to have shared beneficial ownership of the SWAG Common Stock held directly by the Sponsor. |
2. | Each of these individuals holds a direct or indirect interest in the Sponsor. Each such person disclaims any beneficial ownership of the reported shares other than to the extent of any pecuniary interest they may have therein, directly or indirectly. |
3. | Consists of (a) 11,770,918 shares of the Post-Combination Company’s common stock held directly by Mr. Nugent and (b) 566,672 shares of the Post-Combination Company’s common stock held by members of Mr. Nugent’s immediate family for which he may be deemed to have beneficial ownership. Mr. Nugent disclaims any beneficial ownership of the shares held by such family members except to the extent of his indirect pecuniary interest in such shares. |
4. | Consists of (a) 5,778,639 shares of the Post-Combination Company’s common stock held directly by Mr. Van |
5. | Consists of 927 shares of the Post-Combination Company’s common stock subject to warrants exercisable within 60 days of May 31, 2022. |
6. | Iron Gate Management, LLC, a Colorado limited liability company (“Iron Gate Management”), is the sole Manager of Iron Gate Branded Online LLC. Ryan Pollock and Doug Fahoury are the managing members of Iron Gate Management and, therefore, may be deemed to have beneficial ownership of the shares held by Iron Gate Branded Online LLC. The address of Iron Gate Management, LLC, Ryan Pollock and Doug Fahoury is 842 W. South Boulder Rd, Suite 200 Louisville, CO 80027. |
1 |
https://www.emarketer.com/content/us-ecommerce-forecast-2021 |
2 |
https://www.emarketer.com/content/click-collect-already-popular-option-finds-new-gear |
3 |
https://www.emizentech.com/blog/m-commerce-statistics-mobile-shopping-trends.html |
4 |
https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/survey-us-consumer-sentiment-during-the-coronavirus-crisis |
5 |
https://transaction.agency/ecommerce-statistics/42-of-u-s-consumers-have-searched-and-purchased-products-or-services-online/#:~:text=Around%2042%20percent%20of%20U.S.,than%20go%20to%20physical%20stores and https://blog.hubspot.com/marketing/do-consumers-shop-directly-on-social-media-platforms |
• | Comprehensive CaaS Model. |
• | ROI Enablement Outside of Storefront. |
• | Predictive Analytics. |
• | Unified Customer Architecture. |
• | Low-Cost and Efficient Setup. |
• | Cross-channel Selling. point-of-sale |
• | B2C and B2B Support. |
• | GMV Growth. |
• | Global Capability. front-end support for a shopper’s preferred language, as well as back-end control panel language options. |
• | In-House Direct-to-Consumer E-Commerce. e-commerce operations internally. However, maintaining an employee base can be cost-prohibitive when taking into account the required resources such as employees to manage the brand’s storefront, marketing strategy, shipping, fulfillment, order management, and returns not to mention the added costs of any necessary technological or operational upgrades to maintain pace with competitors. Our platform allows retailers to consolidate the full spectrum of their e-commerce operations in one place providing necessary convenience and reliability for a predictable cost while facilitating the brand’s growth. |
• | Alternative E-Commerce Platforms. in-house talent to maintain. Additionally, the company needs to integrate with a number of third-party applications that the brand may not have the resources or expertise to undertake. While enterprise SaaS solutions may offer enhanced functionality, they are often limited in the amount of innovation or upgrades they can provide and any such offerings can be expensive especially for an online brand. Both storefront applications and enterprise solutions also require a longer ramp-up time of anywhere between 4—24 months with estimated implementation costs of between $80K—$5M while our platform typically takes between 1—3 months to implement at no cost. |
• | Legacy Players, Local Distributors, and Brick-and-Mortar brick-and-mortar face-to-face low-margin or not representative of the brand after a certain period of time. Our platforms helps retailers efficiently manage all of their inventory in place and scale their operations and distribution as needed to fulfill customer demand. |
• | Online Marketplaces and Other Non-Direct-to-Consumer in-depth analytics on customer trends. |
• | Awareness (Top of Funnel: Website home page, Blog posts, Infographics, Video, Podcasts, Social Media Posts ) |
• | Consideration (Middle of Funnel: Customer Profiles, eBooks, One Sheet Overviews, Website Features Page, Video) |
• | Decision (Bottom of Funnel: Research Reports, Solution Guides, Check Lists, Competitive Analysis, Customer Case Studies, Website FAQ content, Website Pricing Page, Sales Support Materials) |
• | Retention (Customer Loyalty, Keep them informed) |
• | Products such as Intelligent Commerce (site management), Smart Marketer (digital marketing and predictive analytics), Smart Ship (fulfillment and WMS) and Smart Pay (payments, subscriptions and merchant services); |
• | Intelligence commerce architecture, such as orders, returns and warehouse management, channel partner integrations, customer management, catalog management, content and site management, and security, privacy and data protection grouped into a single software solution; and |
• | Foundational elements, including our data asset, CDP and AI, and flexible API. |
• | Intelligent Commerce Platform |
• | Orders, Returns, and Warehouse Management |
• | Channel Partner Integrations |
• | Customer Management |
• | Catalog Management |
• | Content & Site Management |
• | Security, Privacy, & Data Protection |
• | Foundational Elements |
• | Data Asset |
• | CDP and AI |
• | Flexible API |
1. | AI that supercharges growth. |
2. | Benchmarks, Best Practices, and Behavioral Data. |
3. | Flexible, Intelligent Platform. re-platforming. |
4. | CDP |
• | 5TB Data Processed |
• | 3B Emails and SMS Messages Sent |
• | 50M+ Customers |
1. | Intelligent Commerce—A proprietary open-source enterprise class end to end headless e-commerce platform that includes research and development, a customer data platform and an artificial intelligence data pool across all endpoints for superior customer knowledge and future predictive commerce. |
2. | Smart Marketer—The world’s first multi-channel marketing automation tool designed to create the most effective paid search and paid social campaigns. Smart Marketer combines real-time and historical inventory, sales, and traffic data to craft advertising campaigns that maximize sales and customer acquisition. |
3. | Smart Ship—Provides comprehensive ecommerce order storage and fulfillment solutions that seamlessly integrate with the user’s storefront. Users spend less time worrying about the complicated process of order fulfillment allowing them to focus on sales, marketing, and growing their business. Smart Ship is a separate source of revenue from our existing shipping service revenue and will be included in our fulfillment service revenue moving forward. |
4. | Smart Pay—This is our Payment and Merchant Solutions Product. It uses machine learning and other tactics to better manage fraud and chargebacks. It includes payment management to help facilitate the various vendor and app payouts simplifying finance functions for brands. It also includes standard payment processing functions, as well as management of subscriptions. |
• | Scalable Infrastructure. We operate a proprietary platform that targets online brands and can be scaled to support retailers as they grow in GMV with increased customer count. We also integrate our platform with third-party storefronts and applications as needed to provide a full-stack solution. |
• | Uptime. Our platform maintains market-leading service levels as we guarantee 99.5% uptime to our customers. |
• | Quick and Low-Cost Implementation. Our implementation process typically lasts between 1—3 months and is free of implementation cost for clients while still offering enterprise-level capabilities. |
• | Security. Our platform has built-in enterprise-grade security, speed, uptime, and hosting. We offer native security protection, payments, information applications, and external threat protection along with complying with GDPR and other regulatory agencies. |
• | We Love Data. |
• | Be Simple But Think Analytically. |
• | Take Ownership. |
• | Life’s Too Short Not To Go Big. |
• | Be Authentic, Humble and Remarkable. |
For the Year Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Net service revenue |
$ | 41,866 | $ | 45,517 | $ | 40,954 | ||||||
|
|
|
|
|
|
|||||||
Net product revenue |
51,346 | — | — | |||||||||
Net service revenue from related parties |
8,136 | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total net revenue |
101,348 | 45,517 | 40,954 | |||||||||
Operating costs and expenses: |
||||||||||||
Cost of services |
24,174 | 17,997 | 13,197 | |||||||||
Cost of product revenue |
20,431 | — | — | |||||||||
Sales and marketing |
1,772 | 1,094 | 1,433 | |||||||||
Research and development |
5,361 | 4,289 | 5,021 | |||||||||
General and administrative |
55,369 | 23,865 | 23,387 | |||||||||
Depreciation and amortization |
520 | 415 | 207 | |||||||||
|
|
|
|
|
|
|||||||
Total operating costs and expenses |
107,627 | 47,660 | 43,245 | |||||||||
|
|
|
|
|
|
|||||||
Operating loss |
(6,279 | ) | (2,143 | ) | (2,291 | ) | ||||||
Interest expense |
(926 | ) | (225 | ) | (164 | ) | ||||||
Change in fair value of unconsolidated affiliate |
4,937 | — | — | |||||||||
Other income |
3,378 | 1,418 | 2,480 | |||||||||
|
|
|
|
|
|
|||||||
Income (loss) before income taxes |
1,110 | (950 | ) | 25 | ||||||||
Provision for income taxes |
1,175 | 190 | 25 | |||||||||
|
|
|
|
|
|
|||||||
Net loss |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
|
|
|
|
|
|
For the Three Months Ended March 31 |
||||||||
2022 |
2021 |
|||||||
Net service revenue |
$ | 8,533 | $ | 11,930 | ||||
|
|
|
|
|||||
Net product revenue |
12,922 | — | ||||||
Net service revenue from related parties |
3,744 | — | ||||||
|
|
|
|
|||||
Total net revenue |
25,199 | 11,930 | ||||||
Operating costs and expenses: |
||||||||
Cost of services |
5,435 | 5,666 | ||||||
Cost of product revenue |
10,251 | — | ||||||
Sales and marketing |
566 | 305 | ||||||
Research and development |
1,577 | 1,097 | ||||||
General and administrative |
17,222 | 6,423 | ||||||
Depreciation and amortization |
201 | 108 | ||||||
|
|
|
|
|||||
Total operating costs and expenses |
35,252 | 13,599 | ||||||
|
|
|
|
|||||
Operating loss |
(10,053 | ) | (1,669 | ) | ||||
Interest expense |
(652 | ) | (49 | ) | ||||
Change in fair value of unconsolidated affiliate |
(1,033 | ) | — | |||||
Other income |
1,954 | 229 | ||||||
|
|
|
|
|||||
Loss before income taxes |
(9,784 | ) | (1,489 | ) | ||||
Provision for income taxes |
158 | 5 | ||||||
|
|
|
|
|||||
Net loss |
$ | (9,942 | ) | $ | (1,494 | ) | ||
|
|
|
|
• | Product revenue— |
• | Fulfillment service revenue business-to-business |
• | Marketing service revenue— |
• | Shipping service revenue— |
• | Other service revenue — |
• | Set up and implementation service revenue— |
• | Cost of services. |
• | Cost of product revenue. |
• | Sales and marketing. |
• | Research and development. |
• | General, and administrative. |
• | Depreciation and amortization |
For the Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Net service revenue |
$ | 41,866 | $ | 45,517 | $ | 40,954 | ||||||
Net product revenue |
51,346 | — | — | |||||||||
Net service revenue from related parties |
8,136 | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total net revenue |
101,348 | 45,517 | 40,954 | |||||||||
Operating costs and expenses: |
||||||||||||
Cost of services |
24,174 | 17,997 | 13,197 | |||||||||
Cost of product sales |
20,431 | — | — | |||||||||
Sales and marketing |
1,772 | 1,094 | 1,433 | |||||||||
Research and development |
5,361 | 4,289 | 5,021 | |||||||||
General and administrative |
55,369 | 23,865 | 23,387 | |||||||||
Depreciation and amortization |
520 | 415 | 207 | |||||||||
|
|
|
|
|
|
|||||||
Total operating costs and expenses |
107,627 | 47,660 | 43,245 | |||||||||
|
|
|
|
|
|
|||||||
Operating loss |
(6,279 | ) | (2,143 | ) | (2,291 | ) | ||||||
|
|
|
|
|
|
|||||||
Interest expense |
(926 | ) | (225 | ) | (164 | ) | ||||||
Change in fair value of unconsolidated affiliate |
4,937 | — | — | |||||||||
Other income |
3,378 | 1,418 | 2,480 | |||||||||
|
|
|
|
|
|
|||||||
Income (loss) before income taxes |
1,110 | (950 | ) | 25 | ||||||||
Provision for income taxes |
1,175 | 190 | 25 | |||||||||
|
|
|
|
|
|
|||||||
Net loss |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
|
|
|
|
|
|
For the Three Months Ended March 31 | ||||||||
2022 |
2021 |
|||||||
Net service revenue |
$ | 8,533 | $ | 11,930 | ||||
Net product revenue |
12,922 | — | ||||||
Net service revenue from related parties |
3,744 | — | ||||||
|
|
|
|
|||||
Total net revenue |
25,199 | 11,930 | ||||||
Operating costs and expenses: |
||||||||
Cost of services |
5,435 | 5,666 | ||||||
Cost of product sales |
10,251 | — | ||||||
Sales and marketing |
566 | 305 | ||||||
Research and development |
1,577 | 1,097 | ||||||
General and administrative |
17,222 | 6,423 | ||||||
Depreciation and amortization |
201 | 108 | ||||||
|
|
|
|
|||||
Total operating costs and expenses |
35,252 | 13,599 | ||||||
|
|
|
|
|||||
Operating loss |
(10,053 | ) | (1,669 | ) | ||||
|
|
|
|
|||||
Interest expense |
(652 | ) | (49 | ) | ||||
Change in fair value of unconsolidated |
||||||||
Other income (loss) |
1,954 | 229 | ||||||
|
|
|
|
|||||
Income (loss) before income taxes |
(9,784 | ) | (1,489 | ) | ||||
Provision for income taxes |
158 | 5 | ||||||
|
|
|
|
|||||
Net loss |
$ | (9,942 | ) | $ | (1,494 | ) | ||
|
|
|
|
For the Years Ended December 31, |
||||||||||||
(as a percentage of revenue*) |
2021 |
2020 |
2019 |
|||||||||
Net service revenue |
41.3 | % | 100.0 | % | 100.0 | % | ||||||
Net product revenue |
50.7 | — | — | |||||||||
Net service revenue from related parties |
8.0 | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total net revenue |
100.0 | 100.0 | 100.0 | % | ||||||||
Operating costs and expenses: |
||||||||||||
Cost of services |
23.9 | 39.5 | 32.2 | |||||||||
Cost of product revenue |
20.2 | — | — | |||||||||
Sales and marketing |
1.7 | 2.4 | 3.5 | |||||||||
Research and development |
5.3 | 9.4 | 12.3 | |||||||||
General and administrative |
54.6 | 52.4 | 57.1 | |||||||||
Depreciation and amortization |
0.5 | 0.9 | 0.5 | |||||||||
|
|
|
|
|
|
|||||||
Total operating costs and expenses |
106.2 | 104.7 | 105.6 | |||||||||
|
|
|
|
|
|
|||||||
Operating loss |
(6.2 | ) | (4.7 | ) | (5.6 | ) | ||||||
|
|
|
|
|
|
|||||||
Interest expense |
(0.9 | ) | (0.5 | ) | (0.4 | ) | ||||||
Change in fair value of unconsolidated affiliate |
4.9 | — | — | |||||||||
Other income |
3.3 | 3.1 | 6.1 | |||||||||
|
|
|
|
|
|
|||||||
Income (loss) before income taxes |
1.1 | (2.1 | ) | 0.1 | ||||||||
Provision for income taxes |
1.2 | 0.4 | 0.1 | |||||||||
|
|
|
|
|
|
|||||||
Net income (loss) |
(0.1 | )% | (2.5 | )% | — | % | ||||||
|
|
|
|
|
|
For the Three Months Ended March 31, | ||||||||
(as a percentage of revenue*) |
2022 |
2021 |
||||||
Net service revenue |
33.9 | % | 100.0 | % | ||||
Net product revenue |
51.3 | — | ||||||
Net service revenue from related parties |
14.9 | — | ||||||
|
|
|
|
|||||
Total net revenue |
100.0 | 100.0 | ||||||
Operating costs and expenses: |
||||||||
Cost of services |
21.6 | 47.5 | ||||||
Cost of product revenue |
40.7 | — | ||||||
Sales and marketing |
2.2 | 2.6 | ||||||
Research and development |
6.3 | 9.2 | ||||||
General and administrative |
68.3 | 53.8 | ||||||
Depreciation and amortization |
0.8 | 0.9 | ||||||
|
|
|
|
|||||
Total operating costs and expenses |
139.9 | 114.0 | ||||||
|
|
|
|
|||||
Operating loss |
(39.9 | ) | (14.0 | ) | ||||
|
|
|
|
|||||
Interest expense |
(2.6 | ) | (0.4 | ) | ||||
Change in fair value of unconsolidated affiliate |
(4.1 | ) | — | |||||
Other income (loss) |
7.8 | 1.9 | ||||||
|
|
|
|
|||||
Income (loss) before income taxes |
(38.8 | ) | (12.5 | ) | ||||
Provision for income taxes |
0.6 | 0.0 | ||||||
|
|
|
|
|||||
Net income (loss) |
(39.4 | )% | (12.5 | )% | ||||
|
|
|
|
* | Percentages may not sum due to rounding |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Net revenue |
$ | 101,348 | $ | 45,517 | $ | 55,831 | 122.7 | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Cost of Services |
$ | 24,174 | $ | 17,997 | $ | 6,177 | 34.3 | % | ||||||||
Percent of revenue |
23.9 | % | 39.5 | % |
For the Year Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Cost of product revenue |
$ | 20,431 | $ | — | $ | 20,431 | 100.0 | % | ||||||||
Percent of revenue |
20.2 | % | — | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Sales and marketing |
$ | 1,772 | $ | 1,094 | $ | 678 | 62.0 | % | ||||||||
Percent of revenue |
1.7 | % | 2.4 | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Research and development |
$ | 5,361 | $ | 4,289 | $ | 1,072 | 25.0 | % | ||||||||
Percent of revenue |
5.3 | % | 9.4 | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
General and administrative |
$ | 55,369 | $ | 23,865 | $ | 31,497 | 132.0 | % | ||||||||
Percent of revenue |
54.6 | % | 52.4 | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Depreciation and amortization |
$ | 520 | $ | 415 | $ | 105 | 25.3 | % | ||||||||
Percent of revenue |
0.5 | % | 0.9 | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Interest expense |
$ | 926 | $ | 225 | $ | 701 | 311.6 | % | ||||||||
Percent of revenue |
0.9 | % | 0.5 | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Change in fair value of unconsolidated affiliate |
$ | 4,937 | $ | — | $ | 4,937 | 100.0 | % | ||||||||
Percent of revenue |
4.9 | % | — | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Other income |
$ | 3,378 | $ | 1,418 | $ | 1,960 | 138.2 | % | ||||||||
Percent of revenue |
3.3 | % | 3.1 | % |
For the Years Ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Provision for income tax |
$ | 1,175 | $ | 190 | $ | 985 | 518.4 | % | ||||||||
Percent of revenue |
1.2 | % | 0.4 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Net revenue |
$ | 45,517 | $ | 40,954 | $ | 4,563 | 11.1 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Cost of Services |
$ | 17,997 | $ | 13,197 | $ | 4,800 | 36.4 | % | ||||||||
Percent of revenue |
39.5 | % | 32.2 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Sales and marketing |
$ | 1,094 | $ | 1,433 | $ | (339 | ) | (23.7 | )% | |||||||
Percent of revenue |
2.4 | % | 3.5 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Research and development |
$ | 4,289 | $ | 5,021 | $ | (732 | ) | (14.6 | )% | |||||||
Percent of revenue |
9.4 | % | 12.3 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
General and administrative |
$ | 23,865 | $ | 23,387 | $ | 478 | 2.0 | % | ||||||||
Percent of revenue |
52.4 | % | 57.1 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Depreciation and amortization |
$ | 415 | $ | 207 | $ | 208 | 100.5 | % | ||||||||
Percent of revenue |
0.9 | % | 0.5 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Interest expense |
$ | 225 | $ | 164 | $ | 61 | 37.2 | % | ||||||||
Percent of revenue |
0.5 | % | 0.4 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Other income |
$ | 1,418 | $ | 2,480 | $ | (1,062 | ) | (42.8 | )% | |||||||
Percent of revenue |
3.1 | % | 6.1 | % |
For the Years Ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Provision for income tax |
$ | 190 | $ | 25 | $ | 165 | 660.0 | % | ||||||||
Percent of revenue |
0.4 | % | 0.1 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Net revenue |
$ | 25,199 | $ | 11,930 | $ | 13,269 | 111.2 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Cost of Services |
$ | 5,435 | $ | 5,666 | $ | (231 | ) | (4.1 | )% | |||||||
Percent of revenue |
21.6 | % | 47.5 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Cost of product revenue |
$ | 10,251 | — | $ | 10,251 | 100.0 | % | |||||||||
Percent of revenue |
40.7 | % | — |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Sales and marketing |
$ | 566 | $ | 305 | $ | 261 | 85.5 | % | ||||||||
Percent of revenue |
2.2 | % | 2.6 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Research and development |
$ | 1,577 | $ | 1,097 | $ | 480 | 43.8 | % | ||||||||
Percent of revenue |
6.3 | % | 9.2 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
General and administrative |
$ | 17,222 | $ | 6,423 | $ | 10,799 | 168.1 | % | ||||||||
Percent of revenue |
68.3 | % | 53.8 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Depreciation and amortization |
$ | 201 | $ | 108 | $ | 93 | 86.1 | % | ||||||||
Percent of revenue |
0.8 | % | 0.9 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Interest expense |
$ | 652 | $ | 49 | $ | 603 | 1,230.6 | % | ||||||||
Percent of revenue |
2.6 | % | 0.4 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Change in fair value of unconsolidated affiliate |
$ | (1,033 | ) | $ | — | $ | (1,033 | ) | 100.0 | % | ||||||
Percent of revenue |
(4.1 | )% | — | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Other income (loss) |
$ | 1,954 | $ | 229 | $ | 1,725 | 753 | % | ||||||||
Percent of revenue |
7.8 | % | 1.9 | % |
For the Three Months Ended March 31 |
||||||||||||||||
2022 |
2021 |
$ Change |
% Change |
|||||||||||||
(in thousands, except percentages) |
||||||||||||||||
Provision for income tax |
$ | 158 | $ | 5 | $ | 153 | ||||||||||
Percent of revenue |
0.6 | % | 0.0 | % |
Year ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Net loss |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
|
|
|
|
|
|
|||||||
Interest expense |
926 | 225 | 164 | |||||||||
Provision for income taxes |
1,175 | 190 | 25 | |||||||||
Depreciation and amortization |
520 | 415 | 207 | |||||||||
Contract acquisition costs |
361 | 667 | 623 | |||||||||
|
|
|
|
|
|
|||||||
Adjusted EBITDA |
$ | 3,609 | $ | 672 | $ | 1,019 | ||||||
|
|
|
|
|
|
Three Months ended March 31, |
||||||||
2022 |
2021 |
|||||||
|
|
|
|
|||||
Net loss |
$ | (9,942 | ) | $ | (1,494 | ) | ||
|
|
|
|
|||||
Interest expense |
652 | 49 | ||||||
Provision for income taxes |
158 | 5 | ||||||
Depreciation and amortization |
201 | 108 | ||||||
Contract acquisition costs |
— | 167 | ||||||
|
|
|
|
|||||
Adjusted EBITDA |
$ | (8,931 | ) | $ | (1165 | ) | ||
|
|
|
|
• | Gross Merchandise Value (GMV) |
however, the GMV processed through our platform is an indicator of the volume of transactions processed through our CaaS platform. |
• | Net Dollar Retention Rate. |
Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Cash flow (used in) provided by operating activities |
$ | (21,373 | ) | $ | 1,579 | $ | 9,434 | |||||
Cash flow used in investing activities |
(10,422 | ) | (1,578 | ) | (162 | ) | ||||||
Cash flow provided by (used in) financing activities |
20,198 | 2,266 | (50 | ) |
Three Months Ended March 31, |
||||||||
2022 |
2021 |
|||||||
Cash flow used in operating activities |
$ | (5,277 | ) | $ | (7,898 | ) | ||
Cash flow used in investing activities |
(101 | ) | (202 | ) | ||||
Cash flow provided by financing activities |
3,652 | 5,000 |
Contractual obligations |
Total |
2022 |
2023 |
2024 |
2025 |
2026 |
Thereafter |
|||||||||||||||||||||
Operating lease obligations |
$ | 8,075 | $ | 2,250 | $ | 1,272 | $ | 873 | $ | 900 | $ | 927 | $ | 1,853 |
• | relevant precedent transactions involving our capital stock; |
• | contemporaneous valuations performed at periodic intervals by unrelated third-party specialists; |
• | the liquidation preferences, rights, preferences, and privileges of our redeemable convertible preferred stock relative to the common stock; |
• | our actual operating and financial performance; |
• | current business conditions and projections; |
• | the likelihood and timing of achieving a liquidity event for the shares of common stock underlying the stock options, such as an initial public offering, given prevailing market conditions; |
• | any adjustment necessary to recognize a lack of marketability of the common stock underlying the granted options; |
• | the market performance of comparable publicly-traded companies; and |
• | the U.S. and global capital market conditions. |
• | Identification of a contract with a customer, |
• | Identification of the performance obligations in the contract, |
• | Determination of the transaction price, |
• | Allocation of the transaction price to the performance obligations in the contract, and |
• | Recognition of revenue when or as the performance obligations are satisfied. |
Common Stock |
Preferred Stock |
|||||||||||||||||||
Name of Beneficial Owner |
Number of Shares Beneficially Owned |
Percentage Outstanding |
Number of Shares Beneficially Owned |
Percentage Outstanding |
All Capital Stock Percentage Outstanding |
|||||||||||||||
5% Stockholders: |
||||||||||||||||||||
Jan-Christopher Nugent(1) |
2,912,306 | 31.9 | % | — | — | 23.1 | % | |||||||||||||
Geoff Van Haeren (2) |
1,406,556 | 15.4 | % | — | — | 11.1 | % | |||||||||||||
Stephen Choi (3) |
3,542,162 | 38.8 | % | — | — | 28.0 | % | |||||||||||||
Iron Gate Branded Online, LLC (4) |
— | — | 3,485,104 | 99.5 | % | 27.6 | % | |||||||||||||
Directors and Executive Officers: |
||||||||||||||||||||
Jan-Christopher Nugent |
2,912,306 | 31.9 | % | — | — | 23.1 | % | |||||||||||||
Geoff Van Haeren |
1,406,556 | 15.4 | % | — | — | 11.1 | % | |||||||||||||
Stephen Choi |
3,542,162 | 38.8 | % | — | — | 28.0 | % | |||||||||||||
Ryan Pollock (5) |
440 | * | 3,485,104 | 99.5 | % | 27.6 | % | |||||||||||||
Michael Lin (6) |
66,810 | * | — | — | * | |||||||||||||||
Jay Ku |
440 | * | — | — | * | |||||||||||||||
Directors and executive officers as a group (7 persons): |
7,928,714 |
86.1 |
% |
3,485,104 |
99.5 |
% |
89.8 |
% |
* | Less than one percent |
(1) | Consists of (a) 2,778,542 shares of Nogin’s common stock held directly by Mr. Nugent and (b) 133,764 shares of Nogin’s common stock held by members of Mr. Nugent’s immediate family for which he may be deemed to have beneficial ownership. Mr. Nugent disclaims any beneficial ownership of the shares held by such family members except to the extent of his indirect pecuniary interest in such shares. |
(2) | Consists of (a) 1,364,056 shares of Nogin’s common stock held directly by Mr. Van Haeren and (b) 42,500 shares of Nogin’s common stock held by members of Mr. Van Haeren’s immediate family for which he may be deemed to have beneficial ownership. Mr. Van Haeren disclaims any beneficial ownership of the shares held by such family members except to the extent of his indirect pecuniary interest in such shares. |
(3) | Consists of (a) 3,535,558 shares of Nogin’s common stock held directly by Mr. Choi and (b) 6,604 shares of Nogin’s common stock subject to warrants exercisable within 60 days of May 31, 2022. |
(4) | Iron Gate Management, LLC, a Colorado limited liability company (“Iron Gate Management”), is the sole Manager of Iron Gate Branded Online LLC. Ryan Pollock and Doug Fahoury are the managing members of Iron Gate Management and, therefore, may be deemed to have beneficial ownership of the shares held by Iron Gate Branded Online LLC. The address of Iron Gate Management, LLC, Ryan Pollock and Doug Fahoury is 842 W. South Boulder Rd, Suite 200 Louisville, CO 80027. |
(5) | Consists of 440 shares of Nogin’s common stock subject to warrants exercisable within 60 days of May 31, 2022. Mr. Pollock is a managing member at Iron Gate Management. Mr. Pollock otherwise disclaims beneficial ownership interest of the securities held by Iron Gate Branded Online, LLC referred to in footnote (4) above, except to the extent of his pecuniary interest, if any, in such securities. |
(6) | Consists of (a) 66,590 shares of Nogin’s common stock subject to options exercisable within 60 days of May 31, 2022 and (b) 220 shares of Nogin’s common stock subject to warrants exercisable within 60 days of May 31, 2022. |
Name |
Age |
Position | ||||
Executive Officers |
||||||
Jan-Christopher Nugent |
51 | Co-Chief Executive Officer and Director Nominee | ||||
Jonathan S. Huberman |
56 | Co-Chief Executive Officer, President and Director Nominee | ||||
Geoffrey Van Haeren |
51 | Chief Technology Officer and Director Nominee | ||||
Michael Lin |
51 | Chief Financial Officer | ||||
Director Nominees |
||||||
Wilhelmina Fader |
59 | Director Nominee | ||||
Eileen Moore Johnson |
50 | Director Nominee |
• | we will have independent director representation on our audit, compensation and nominating committees immediately at the time of the Business Combination, and our independent directors will meet regularly in executive sessions without the presence of our corporate officers or non-independent directors; |
• | at least one of our directors will qualify as an “audit committee financial expert” as defined by the SEC; and |
• | we will implement a range of other corporate governance best practices, including implementing a robust director education program. |
• | appointing, compensating, retaining, evaluating, terminating and overseeing our independent registered public accounting firm; |
• | discussing with our independent registered public accounting firm their independence from management; |
• | reviewing, with our independent registered public accounting firm, the scope and results of their audit; |
• | approving all audit and permissible non-audit services to be performed by our independent registered public accounting firm; |
• | overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the quarterly and annual financial statements that we file with the SEC; |
• | overseeing our financial and accounting controls and compliance with legal and regulatory requirements; |
• | reviewing our policies on risk assessment and risk management; |
• | reviewing related person transactions; and |
• | establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters. |
• | reviewing and approving the corporate goals and objectives, evaluating the performance of and reviewing and approving, (either alone or, if directed by the board of directors, in conjunction with a majority of the independent members of the board of directors) the compensation of our Chief Executive Officer; |
• | overseeing an evaluation of the performance of and reviewing and setting or making recommendations to our board of directors regarding the compensation of our other executive officers; |
• | reviewing and approving or making recommendations to our board of directors regarding our incentive compensation and equity-based plans, policies and programs; |
• | reviewing and approving all employment agreement and severance arrangements for our executive officers; |
• | making recommendations to our board of directors regarding the compensation of our directors; and |
• | retaining and overseeing any compensation consultants. |
• | identifying individuals qualified to become members of our board of directors, consistent with criteria approved by our board of directors; |
• | overseeing succession planning for our Chief Executive Officer and other executive officers; |
• | periodically reviewing our board of directors’ leadership structure and recommending any proposed changes to our board of directors; |
• | overseeing an annual evaluation of the effectiveness of our board of directors and its committees; and |
• | developing and recommending to our board of directors a set of corporate governance guidelines. |
• | attract, retain and motivate senior management leaders who are capable of advancing our mission and strategy and ultimately, creating and maintaining our long-term equity value. Such leaders must engage in a collaborative approach and possess the ability to execute our business strategy in an industry characterized by competitiveness and growth; |
• | reward senior management in a manner aligned with our financial performance; and |
• | align senior management’s interests with our equity owners’ long-term interests through equity participation and ownership. |
• | Jan-Christopher Nugent, Founder and Chief Executive Officer; |
• | Geoff Van Haeren, our President; and |
• | Jay Ku, our Chief Commerce Officer. |
Name and Principal Position |
Year |
Salary ($) |
Bonus ($) (1) |
Non-Equity Incentive Plan Compensation ($) (2) |
Total |
|||||||||||||||
Jan-Christopher Nugent. |
2021 | 480,000 | 120,000 | 657,928 | 1,257,928 | |||||||||||||||
Chief Executive Officer |
||||||||||||||||||||
Geoff Van Haeren |
2021 | 420,000 | 100,000 | 433,080 | 953,080 | |||||||||||||||
President |
||||||||||||||||||||
Jay Ku |
2021 | 262,500 | (3) |
— | 125,000 | 387,500 | ||||||||||||||
Chief Commerce Officer |
(1) | Amounts shown represent the guaranteed portion of the annual bonus payable to Mr. Nugent and Mr. Van Haeren for 2021. |
(2) | Amounts shown represent the annual cash bonuses awarded to each of the named executive officers for 2021 performance. |
(3) | Mr. Ku commenced employment with Nogin on March 22, 2021 at an annual base salary rate of $350,000. The amount shown reflects his prorated annual salary and annual bonus for the portion of the year in which he was employed by Nogin. |
Name |
Current Annual Base Salary ($) |
|||
Jan-Christopher Nugent. |
480,000 | |||
Geoff Van Haeren |
420,000 | |||
Jay Ku |
350,000 |
Name |
Performance Goal |
Target Payout (1) |
||||
Jan Nugent |
Bookings | $ | 300,000 | |||
EBITDA | $ | 20,000 | ||||
Strategic milestones | $ | 40,000 | ||||
|
|
|||||
Geoff Van Haeren |
Bookings | $ | 200,000 | |||
EBITDA | $ | 10,000 | ||||
Operational milestones | $ | 25,000 | ||||
Milestone product achievement | $ | 25,000 | ||||
|
|
|||||
Jay Ku |
Base revenue achievement | $ | 75,000 | |||
Additional revenue achievement | $ | 50,000 | ||||
EBITDA | $ | 25,000 | ||||
Milestone product achievement | $ | 50,000 | ||||
|
|
• | research on industry trends, projected growth and other industry factors; |
• | extensive meetings and calls with Nogin’s management team and representatives regarding operations, major customers, financial prospects and potential expansion opportunities, among other customary due diligence matters; |
• | consultation with SWAG’s legal and financial advisors; |
• | review of Nogin’s material business contracts and certain other legal, intellectual property and commercial diligence; |
• | feedback from Nogin’s current customers; |
• | financial, accounting and tax diligence; |
• | research on comparable public companies; and |
• | review of Nogin’s financial projections and SWAG management’s creation of an independent financial model based on information and materials provided by Nogin management to SWAG management and in conjunction with management of Nogin. SWAG management’s independent financial model was generally consistent with the financial model prepared by Nogin. However, SWAG management’s independent financial model, among other things, was also sensitized to evaluate potential upside and downside scenarios. |
• | Stockholder Liquidity. |
• | Financial Condition. |
• | Experienced and Proven Management Team. |
• | Lock Up one-year lockup in respect of their SWAG Class A Common Stock and all other stockholders of Nogin will be subject to a six-month lockup in respect of their SWAG Class A Common Stock, subject to certain customary exceptions and price-based releases, which lockup will provide important stability to the leadership and governance of Nogin; |
• | Other Alternatives. |
• | Negotiated Transaction. arm’s-length negotiations between SWAG and Nogin. |
• | Macroeconomic Risks. COVID-19 pandemic, and the effects it could have on the Post-Combination Company’s revenues; |
• | Business Plan and Projections May Not Be Achieved. |
• | Early Stage Company and Limited Operating History. |
• | Redemption Risk. |
Combination, which would potentially make the Business Combination more difficult or impossible to complete; |
• | Stockholder Vote. |
• | Closing Conditions. |
• | Litigation. |
• | Listing Risks. |
• | Benefits May Not Be Achieved. |
• | Liquidation of SWAG. |
• | Growth Initiatives May Not be Achieved. |
• | No Third Party Valuation |
• | SWAG Stockholders Receiving a Minority Position in Nogin. |
• | Fees and Expenses. |
• | Interests of Certain Persons. Some officers and directors of SWAG may have interests in the Business Combination (see “—Interests of SWAG’s Directors and Officers in the Business Combination”). |
• | Other Risk Factors. Various other risk factors associated with the business of Nogin, as described in the section entitled “Risk Factors” appearing elsewhere in this proxy statement/prospectus. |
2021E |
2022E (1) |
2023E (1) |
||||||||||
($ in millions) |
||||||||||||
Total revenue |
$ | 67.9 | $ | 107.2 | $ | 175.8 | ||||||
Operating income (loss) |
$ | (4.7 | ) | $ | 4.4 | $ | 30.1 | |||||
Adjusted EBITDA (2) |
$ | 5.0 | $ | 6.3 | $ | 32.8 |
(1) | Shown to normalize non-recurring inventory sale in 2022 by converting product sale clients, related cost of sales and operating expense to a full CaaS model that includes CaaS, marketing and shipping revenue and cost of services directly related to providing services under the master service agreements with customers (e.g. service provider, marketing, fulfillment expenses and credit card merchant fees), and therefore generate additional revenues in 2022 and not recognizing such product revenue in 2021. |
(2) | Nogin defines Adjusted EBITDA as net income plus depreciation and amortization, capitalized R&D, contract acquisition costs and other income from operating income. |
2022E (1) |
2023E (1) |
|||||||
($ in millions) |
||||||||
Total revenue |
$ | 96.9 | $ | 164.6 | ||||
Operating income (loss) |
$ | (4.7 | ) | $ | 16.3 | |||
Adjusted EBITDA (2) |
$ | (1.9 | ) | $ | 19.1 |
(1) | Shown to normalize non-recurring inventory sale in 2022 by converting product sale clients, related cost of sales and operating expense to a full CaaS model that includes CaaS, marketing and shipping revenue and cost of services directly related to providing services under the master service agreements with customers (e.g. service provider, marketing, fulfillment expenses and credit card merchant fees), and therefore generate additional revenues in 2022 and not recognizing such product revenue in 2021. |
(2) | Nogin defines Adjusted EBITDA as net income plus depreciation and amortization, capitalized R&D, contract acquisition costs and other income from operating income. |
• | a closing date of the business combination in the second quarter of 2022 for the Initial Projections, and a closing date in the third quarter of 2022 for the Updated Projections, and certain anticipated capital investments based on closing dates in the second and third quarters of 2022, respectively. |
• | Nogin has a history of high revenue growth each year, which has been driven by customer acquisition along with existing customer growth, both of which management believes to be effective and scalable. |
• | For the existing client base, there is a history of year-over-year GMV growth that management expects to continue. In addition, most clients have multi-year contracts with renewal options. |
• | Projected revenues are also based on assumptions of new deal acquisitions which are driven by the sales team’s quotas along with varying average deal sizes. |
• | Nogin is currently developing new products that will allow the company to reach a larger market and allow the company to meet the individual needs of more prospective clients. |
• | Nogin includes a discount factor on all existing customers to account for customer churn and discounts on renewals. |
• | Assessments of headcount requirements, including headcount for sales and marketing to drive the expected revenue growth from new deal acquisitions and the corresponding headcount required to support those new customers along with support for new product offerings. |
• | Efficiencies of scale that occur as revenue increases along with efficiencies Nogin expects to realize from technology improvements allowing increased utilization from existing headcount. |
• | Other key assumptions impacting profitability include administrative infrastructure, capital expenditures, investment in technology associated with new product development and investment in sales and marketing. |
• | Supply chain constraints. In late-2021, the Company experienced supply chain issues related to the shifting economy, which resulted in the delay of receiving product for several clients along with inventory owned by the Company. As such, the Company sold the inventory at lower prices and gross margins in the first and second quarter of 2022. |
• | Closing of the Business Combination. Management anticipated the closing of the Business Combination in the second quarter of 2022 for purposes of preparing the Initial Projections. The Updated Projections reflect the delay in receipt of the proceeds of the Business Combination, which would have allowed for investment into the business in areas such as sales and marketing. |
• | If the Business Combination with Nogin or another business combination is not consummated within the Completion Window, SWAG will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding Public Shares for cash and, subject to the approval of its remaining stockholders and the SWAG Board, dissolving and liquidating. In such event, the 5,701,967 Founder Shares held by SWAG’s Initial Stockholders, which were acquired for an aggregate purchase price of $25,000 prior to the SWAG IPO, would be worthless because SWAG’s Initial Stockholders are not entitled to participate in any redemption or distribution with respect to such shares. Such shares had an aggregate market value of $ based upon the closing price of $ per share of Class A Common Stock on the Nasdaq on , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus. Certain Founder Shares are subject to certain time and performance-based vesting provisions as described under “ Other Agreements – Sponsor Agreement |
• | The Sponsor purchased an aggregate of 9,982,754 Private Placement Warrants from SWAG for an aggregate purchase price of $9,982,754 (or $1.00 per warrant). These purchases took place on a private placement basis simultaneously with the consummation of the SWAG IPO. A portion of the proceeds SWAG received from these purchases were placed in the Trust Account. Such warrants had an aggregate market value of $ based upon the closing price of $ per public warrant on the Nasdaq on , 2022, the most recent practicable date prior to the date of this proxy statement/prospectus. The Private Placement Warrants will become worthless if SWAG does not |
consummate a business combination within the Completion Window. The Sponsor paid an aggregate of $10,007,754 for its purchases of the Founder Shares and the Private Placement Warrants. |
• | We pay our Sponsor $15,000 per month for office space, secretarial and administrative services provided to members of our management team. Such arrangement will terminate upon the consummation of the Business Combination. |
• | On February 9, 2022, SWAG issued an unsecured promissory note in the principal amount of $300,000 to the Sponsor. On May 31, 2022, SWAG issued an unsecured promissory note in the principal amount of $100,000 to the Sponsor. The notes do not bear interest and are repayable in full upon consummation of SWAG’s initial business combination. If SWAG does not complete a business combination, the notes will not be repaid and all amounts owed under it will be forgiven. The notes are subject to customary events of default, the occurrence of which automatically trigger the unpaid principal balance of the notes and all other sums payable with regard to the notes becoming immediately due and payable. |
• | Our Sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business, with which we have discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (i) $10.15 per Public Share or (ii) such lesser amount per public share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes. If SWAG consummates the Business Combination, on the other hand, SWAG will be liable for all such claims. |
• | SWAG’s directors and officers, and their affiliates are entitled to reimbursement of out-of-pocket |
• | Our Sponsor, officers and directors have agreed not to transfer, assign or sell any of their Founder Shares until the earlier to occur of: (i) six months after the completion of the Business Combination and (ii) the date following the completion of the Business Combination on which we complete a liquidation, merger, capital stock exchange or other similar transaction that results in all of our stockholders having the right to exchange their common stock for cash, securities or other property, subject to certain exceptions. Notwithstanding the foregoing, if the closing price of our Class A Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Business Combination, the Founder Shares will be released from the lockup. |
• | Subject to certain limited exceptions, the Private Placement Warrants will not be transferable until 30 days following the completion of the Business Combination. |
• | No compensation of any kind, including finder’s and consulting fees, is paid to our Sponsor, officers and directors, or any of their respective affiliates, for services rendered prior to or in connection with the completion of an initial business combination, except for reimbursement for out-of-pocket out-of-pocket |
• | The continued indemnification of current directors and officers and the continuation of directors’ and officers’ liability insurance. |
• | Due to the differential in the purchase price that our Sponsor and its affiliates paid for the Founder Shares and Private Placement Warrants as compared to the price of the Public Shares sold in the SWAG IPO and the substantial number of Class A Common Stock our Sponsor will receive upon |
conversion of the Founder Shares in connection with the Business Combination and exercise of the Private Placement Warrants, our Sponsor and its affiliates may earn a positive rate of return on their investment even if other SWAG Public Stockholders experience a negative rate of return in the post-business combination company. |
• | Our Sponsor, officers and directors would hold the following number of shares of common stock in the Post-Combination Company at the closing of the Business Combination: |
Name of Person/Entity |
Number of Shares of Common Stock |
Value of Shares (1) |
||||||
Software Acquisition Holdings III LLC (2) |
5,701,967 | $ | 57,019,670 | |||||
Jonathon Huberman (3) |
5,701,967 | $ | 57,019,670 | |||||
Mike Nikzad (3) |
5,701,967 | $ | 57,019,670 | |||||
Andrew K. Nikou (3) |
5,701,967 | $ | 57,019,670 | |||||
C. Matthew Olton |
— | — | ||||||
Stephanie Davis |
— | — | ||||||
Steven Guggenheimer |
— | — | ||||||
Dr. Peter H. Diamandis |
— | — |
(1) | Assumes a value of $10.00 per share, the deemed value of the Class A Common Stock in the Business Combination. |
(2) | The Sponsor is the record holder of such shares. The Sponsor is controlled by a board of managers which consists of Jonathan Huberman, SWAG’s Chairman, Chief Executive Officer and Chief Financial Officer, Mike Nikzad, SWAG’s Vice President of Acquisitions and a director, and Andrew Nikou, one of SWAG’s directors. As such, they have voting and investment discretion with respect to the SWAG Common Stock held of record by the Sponsor and may be deemed to have shared beneficial ownership of the SWAG Common Stock held directly by the Sponsor. |
(3) | Each of these individuals holds a direct or indirect interest in the Sponsor. Each such person disclaims any beneficial ownership of the reported shares other than to the extent of any pecuniary interest they may have therein, directly or indirectly. |
• | Certain of Nogin’s directors and executive officers are expected to become directors and/or executive officers of the Post-Combination Company upon the closing of the Business Combination. Specifically, the following individuals who are currently executive officers of Nogin are expected to become executive officers of the Post-Combination Company upon the closing of the Business Combination, serving in the offices set forth opposite their names below: |
Name |
Position | |
Jan-Christopher Nugent |
Chief Executive Officer | |
Geoffrey Van Haeren |
President | |
Michael Lin |
Interim Chief Financial Officer | |
Jay Ku |
Chief Commerce Officer |
• | In addition, the following individuals who are currently members of the Nogin board of directors are expected to become members of the Post-Combination Company board of directors upon the closing of the Business Combination: . |
• | Certain of Nogin’s executive officers and directors as of the date of the Merger Agreement hold Nogin stock options. The treatment of such stock options in connection with the Business Combination is described in “ The Merger Agreement—Treatment of Nogin Equity Awards |
Nogin Stock Options |
||||||||
Executive Officers and Directors |
Vested |
Unvested |
||||||
Jan-Christopher Nugent |
0 | 0 | ||||||
Geoffrey Van Haeren |
0 | 0 | ||||||
Michael Lin |
51,329 | 15,261 | ||||||
Jay Ku |
0 | 66,883 |
• | there must not be in effect any order prohibiting or preventing the consummation of the Business Combination and no law adopted, enacted or promulgated that makes consummation of the Business Combination illegal or otherwise prohibited; |
• | all waiting periods and any extensions thereof applicable to the transactions contemplated by the Merger Agreement under the HSR Act, and any commitments or agreements (including timing agreements) with any governmental entity not to consummate the Business Combination before a certain date, must have expired or been terminated; |
• | the offer contemplated by this proxy statement/prospectus must have been completed in accordance with the terms of the Merger Agreement and this proxy statement/prospectus; |
• | the approval of each of the proposals set forth in this proxy statement/prospectus must have been obtained in accordance with the DGCL, SWAG’s Organizational Documents and the rules and regulations of Nasdaq; |
• | the approval of the Business Combination by the holders of Nogin Common Stock and Nogin Preferred Stock must have been obtained in accordance with the DGCL and Nogin’s organizational documents; |
• | the Registration Statement must have become effective in accordance with the Securities Act and no stop order suspending the effectiveness of the Registration Statement be in effect and no proceedings for that purpose have commenced or be threatened by the SEC; |
• | the SWAG Common Stock to be issued in the Business Combination must have been approved by the Nasdaq, subject only to official notice of issuance thereof. |
• | the representations and warranties of the Parent Parties (other than fundamental representations), disregarding qualifications contained therein relating to materiality, must be true and correct as of the Closing Date as if made at and as of such time (or, if given as of an earlier date, as of such earlier date), except that this condition will be satisfied unless any and all inaccuracies in such representations and warranties of the Parent Parties, in the aggregate, would or would reasonably be expected to result in a Material Adverse Effect with respect to the Parent Parties, and fundamental representations must be true an correct in all respects as of the Closing Date (or, if given as of an earlier date, such earlier date); |
• | each of the Parent Parties must have performed in all material respects its obligations under the Merger Agreement required to be performed by it at or prior to the Closing; |
• | Nogin must have received a certificate executed and delivered by an authorized officer of the Parent Parties confirming that the conditions set forth in the immediately preceding bullet points have been satisfied; |
• | the proceeds from the Business Combination, consisting of (a) the aggregate cash proceeds available for release to SWAG from the Trust Account in connection with the Business Combination (after, for the avoidance of doubt, giving effect to any redemptions of shares of SWAG Common Stock by stockholders of SWAG but before release of any other funds) plus (b) proceeds received in connection with any PIPE investment, must be equal to or in excess of $50 million; and |
• | the directors and executive officers of SWAG must have been removed from their respective positions or tendered their irrevocable resignations effective as of the Closing. |
• | the representations and warranties of Nogin (other than fundamental representations), disregarding qualifications contained therein relating to materiality, must be true and correct as of the Closing Date as if made at and as of such time (or, if given as of an earlier date, as of such earlier date), except that this condition will be satisfied unless any and all inaccuracies in such representations and warranties of Nogin, in the aggregate, would or would reasonably be expected to result in a Material Adverse Effect with respect to Nogin, and fundamental representations must be true an correct in all respects as of the Closing Date (or, if given as of an earlier date, such earlier date); |
• | Nogin must have performed in all material respects its obligations under the Merger Agreement required to be performed by it at or prior to the Closing; |
• | SWAG must have received a certificate executed and delivered by an authorized officer of Nogin confirming that the conditions set forth in the immediately preceding bullet points have been satisfied; |
• | the Parent Parties must have received a copy of the written consent of the holders of Nogin Common Stock and Nogin Preferred Stock, which must remain in full force and effect; and |
• | since the date of the Merger Agreement, a Material Adverse Effect with respect to Nogin must not have occurred. |
• | During the period from the date of the Merger Agreement through the earlier of (x) termination of the Merger Agreement and (y) the Closing Date, except as contemplated by the Merger Agreement, |
required by applicable law (including COVID-19 measures), described in the Parent disclosure schedules or consented to by Nogin, SWAG will not: make any change to its organizational documents; issue equity capital; split, combine, redeem or reclassify its capital stock; authorize or pay any dividends or make distributions with respect to its capital stock or other equity; sell, lease or dispose of any of its material properties or assets; incur or guarantee any indebtedness of another person or issue any debt securities; make certain material tax elections; except as required by law, make any material change in financial or tax accounting methods; take any action likely to prevent, delay or impede the consummation of the Business Combination; make any amendment or modification to the Trust Agreement; make or allow to be made any reduction to the amount in the Trust Account other than as expressly permitted by SWAG’s organizational documents; directly or indirectly acquire or merge with any other person; make any capital expenditures; enter into any new line of business; adopt or effect a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization; or authorize or commit or agree to take any of the foregoing actions. |
• | Upon satisfaction or waiver of the conditions described above in the section entitled “— Conditions to Closing of the Business Combination” and provision of notice thereof to the Trustee, (a) in accordance with and pursuant to the Trust Agreement, at the Closing, SWAG (i) will cause the documents, opinions and notices required to be delivered to the Trustee pursuant to the Trust Agreement to be delivered, and (ii) will use commercially reasonable efforts to cause the Trustee to (A) pay as and when due all amounts payable to stockholders of SWAG holding shares of the Parent common stock sold in Parent’s initial public offering who must have previously validly elected to redeem their shares of Parent common stock pursuant to Parent’s Organizational Documents, and (B) immediately thereafter, pay all remaining amounts then available in the Trust Account in accordance with the Merger Agreement and the Trust Agreement, and (b) thereafter, the Trust Account will terminate, except as otherwise provided therein. |
• | SWAG agreed to cause the surviving company to ensure that all rights to indemnification existing at the time the Merger Agreement was signed in favor of any director or officer of Nogin or its subsidiaries will surviving for not less than six years from the Effective Time, and SWAG and the surviving company will not settle, compromise or consent to the entry of judgment in any action, proceeding or investigation without the written consent of such indemnified person. |
• | As promptly as practicable following the execution and delivery of the Merger Agreement and the availability of Nogin’s financial statements, SWAG agreed to prepare and file with the SEC this proxy statement/prospectus in connection with the transactions contemplated by the Merger Agreement and the Offer and provide its stockholders with the opportunity for up to 22,807,868 shares of SWAG Common Stock to be redeemed in conjunction with a stockholder vote on the transactions contemplated by the Merger Agreement, with this proxy statement/prospectus to be sent to the stockholders of SWAG relating to the Special Meeting in definitive form, all in accordance with and as required by Parent’s Organizational Documents, any related agreements with Parent, Parent’s Sponsor and its Affiliates, applicable Law and any applicable rules and regulations of the SEC and Nasdaq. As promptly as practicable following the execution and delivery of the Merger Agreement, SWAG agreed to prepare and file with the SEC the registration statement of which this proxy statement/prospectus forms a part, pursuant to which the offering of shares of SWAG Common Stock to be issued to the holders of Nogin capital stock pursuant to the Merger will be registered under the Securities Act. |
• | SWAG will, as promptly as practicable, establish a record date and hold a meeting of stockholders for the purpose of voting on the Transaction Proposals. SWAG will, through its board of directors, recommend to its stockholders that they vote in favor of the Transaction Proposals, and will not change, withdraw, withhold, qualify or modify such recommendation except as required by applicable law. |
• | SWAG will use its commercially reasonable efforts to (i) cause the shares of SWAG Common Stock to be issued to the holders of Nogin capital stock to be approved for listing on Nasdaq upon issuance, and |
(ii) make all necessary and appropriate filings with Nasdaq and undertake all other steps reasonably required prior to the Closing Date to effect such listing. |
• | SWAG will make all necessary filings with respect to the transactions contemplated by the Merger Agreement under the Securities Act, the Exchange Act and applicable “blue sky” laws and any rules and regulations thereunder. |
• | Prior to the Closing, the board of directors of SWAG, or an appropriate committee of non-employee directors thereof, will adopt a resolution consistent with the interpretive guidance of the SEC so that the acquisition of SWAG Common Stock pursuant to the Merger Agreement by any officer or director of SWAG who is expected to become a “covered person” of SWAG for purposes of Section 16 of the Exchange Act and the rules and regulations thereunder will be an exempt transaction for purposes of Section 16 of the Exchange Act. |
• | From the date of the Merger Agreement until the earlier of (x) the Effective Time or (y) the date on which the Merger Agreement is terminated, other than in connection with the transaction contemplated by the Merger Agreement, SWAG agreed that it will not, and will not authorize or (to the extent within its control) permit any of its Affiliates, directors, officers, employees, agents or representatives (including investment bankers, attorneys and accountants), in each case in such directors’, officers’, employees’, agents’ or representatives’ capacity in such role with SWAG, to, directly or indirectly, (i) knowingly encourage, initiate, solicit, or facilitate, offer, or make any offers or proposals related to, an alternate business combination, (ii) engage in any discussions or negotiations with respect to an alternate business combination with, or provide any non-public information or data to, any Person that has made, or informs SWAG that it is considering making, an alternate business combination proposal, or (iii) enter into any agreement (whether or not binding) relating to an alternate business combination. SWAG must give notice of any alternate business combination to Nogin as soon as practicable following its awareness of such proposal. |
• | From and after the Closing Date, except as otherwise required by applicable Law, each Parent Party will not, and will cause the surviving company and its subsidiaries not to, make, cause or permit to be made any Tax election or adopt or change any method of accounting, in each case that has retroactive effect to any pre-Closing period of Nogin or any of its subsidiaries. |
• | The board of directors of SWAG will, in consultation with Nogin, approve and adopt the Incentive Plan effective as no later than the day before the Closing Date. |
• | During the period from the date of the Merger Agreement through the earlier of (x) termination of the Merger Agreement and (y) the Closing Date, except as contemplated by the Merger Agreement, required by applicable law (including COVID-19 measures), described in the Nogin disclosure schedules or consented to by SWAG, Nogin will operate its business in the ordinary course and will not (subject to certain customary materiality thresholds): make any change to its organizational documents; issue equity capital; split, combine, redeem or reclassify its capital stock; sell, lease, license, permit to lapse, transfer, abandon or otherwise dispose of any of its properties or assets that are material to its business; amend in any adverse respect or terminate any material lease; incur indebtedness; make certain employee benefit grants or adopt any new employee benefit plans; make certain material tax elections; cancel or forgive indebtedness; except as required by law, make any material change in financial or tax accounting methods; make certain changes with respect to collective bargaining arrangements; implement certain workforce reduction methods; take affirmative steps to waive or release any noncompetition, nondisclosure, noninterference, nondisparagement or other restrictive covenant obligation of certain current or former employees and contractors; incur certain |
liens; pay any dividends or make distributions; make any material change to any cash management practices; compromise certain lawsuits; incur non-ordinary course capital expenditures; acquire certain other business or properties; enter into any new line of business; adopt a plat of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization; fail to use commercially reasonable efforts to maintain existing insurance policies or comparable replacements; take any action that is reasonably likely to prevent, delay or impede the consummation of the Business Combination; or authorize or commit or agree to take any of the foregoing actions. |
• | From the date of the Merger Agreement until the earlier of (x) the Effective Time or (y) the date on which the Merger Agreement is terminated, other than in connection with the transaction contemplated by the Merger Agreement, Nogin agreed that it will not, and will not authorize or (to the extent within its control) permit any Nogin Subsidiary or any of its or any Nogin Subsidiary’s Affiliates, directors, officers, employees, agents or representatives (including investment bankers, attorneys and accountants), in each case in such directors’, officers’, employees’, agents’ or representatives’ capacity in such role with Nogin, to, directly or indirectly, (i) knowingly encourage, initiate, solicit, or facilitate, offer, or make any offers or proposals related to, an acquisition proposal, (ii) engage in any discussions or negotiations with respect to an acquisition proposal with, or provide any non-public information or data to, any Person that has made, or informs Nogin that it is considering making, an acquisition proposal, or (iii) enter into any agreement (whether or not binding) relating to an acquisition proposal. Nogin must give notice of any acquisition proposal to SWAG as soon as practicable following its awareness of such proposal. |
• | From the date of the Merger Agreement through its termination or consummation, Nogin will grant SWAG access to its employees and facilities. |
• | Nogin will take all actions necessary to terminate certain related party agreements in a manner such that the surviving company has no liability or obligation following the Effective Time. |
• | Nogin will use commercially reasonable efforts to solicit an irrevocable written consent of its equityholders approving the Business Combination, and will cause its board of directors to recommend approving the business combination. |
• | Nogin will use best efforts to provide SWAG, as promptly as practicable, audited financial statements (audited to the standards of the U.S. Public Company Accounting Oversight Board), including consolidated balance sheets, statements of operations, statements of cash flows and statements of stockholders’ equity of Nogin as of and for the years ended December 31, 2020 and 2019, in each case prepared in accordance with GAAP. |
• | Nogin will use commercially reasonable efforts to assign certain intellectual property rights to the surviving company. |
• | Each of the Parties will cooperate and use their commercially reasonable efforts to take, or cause to be taken, all action, and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws to consummate the transactions contemplated by the Merger Agreement reasonably promptly after the date thereof, including obtaining all licenses, permits, consents, approvals, authorizations, qualifications and orders of Governmental Entities necessary to consummate the transactions contemplated by the Merger Agreement. Nogin will pay the applicable filing fees due under the HSR Act. |
• | The Parties agreed not to make any public announcement without the other party’s consent, except as required by applicable law. |
• | At the Closing, SWAG, Nogin and certain Nogin Stockholders will enter into a Registration Rights Agreement. |
• | in writing, by mutual consent of the Parties; |
• | by SWAG or Nogin if any law or order permanently restraining, enjoining or otherwise prohibiting the consummation of the Merger has been enacted and has become final and non-appealable, except that a party may not terminate the Merger Agreement for this reason if it has breached in any material respect its obligations set forth in this Agreement in any manner than has proximately contributed to the enactment, issuance, promulgation or entry into such law or order; |
• | by Nogin (if not in breach such that a closing condition cannot be satisfied) if any representation or warranty is not true and correct or if SWAG has failed to perform any covenant or agreement made by any Parent Party in the Merger Agreement, such that the conditions to the obligations of SWAG, as described in the section entitled “—Conditions to Closing of the Business Combination” above, could not be satisfied as of the Closing Date, and (ii) are or cannot be cured within thirty days after written notice from Nogin of such breach is received by the Parent Parties, or which breach, untruth or inaccuracy, by its nature, cannot be cured prior to the Outside Date; |
• | by SWAG (if not in breach such that a closing condition cannot be satisfied) if any representation or warranty is not true and correct or if Nogin has failed to perform any covenant or agreement made by Nogin in the Merger Agreement, such that the conditions to the obligations of Nogin, as described in the section entitled “—Conditions to Closing of the Business Combination” above, could not be satisfied as of the Closing Date, and (ii) are or cannot be cured within thirty days after written notice from SWAG of such breach is received by the Parent Parties, or which breach, untruth or inaccuracy, by its nature, cannot be cured prior to the Outside Date; |
• | by written notice by any Party if the Closing has not occurred on or prior to August 31, 2022 so long as such Party is not then in breach of the Merger Agreement in a manner that contributed to the occurrence of the failure of a condition; |
• | by Nogin if SWAG’s board of directors changes its recommendation in favor of the Business Combination; |
• | by SWAG if the required approvals of Nogin have not been obtained within five business days following the time that the registration statement of which this proxy statement/prospectus forms a part is declared effective; or |
• | by SWAG or Nogin if the approval of the Transaction Proposals is not obtained at the Parent Common Stockholders Meeting (including any adjournments of such meeting). |
• | a bank or financial institution; |
• | a tax-exempt organization; |
• | a real estate investment trust; |
• | an S corporation or other pass-through entity (or an investor in an S corporation or other pass-through entity); |
• | an insurance company; |
• | a regulated investment company or a mutual fund; |
• | a “controlled foreign corporation” or a “passive foreign investment company;” |
• | a dealer or broker in stocks and securities, or currencies; |
• | a dealer or trader in securities that elects (or is subject to) mark-to-market |
• | a holder of Public Shares that is liable for the alternative minimum tax; |
• | a holder subject to the base erosion and anti-abuse tax under Section 59A of the Code; |
• | a holder of Public Shares that received Public Shares through the exercise of an employee stock option, through a tax qualified retirement plan or otherwise as compensation; |
• | a U.S. Holder (as defined below) of Public Shares that has a functional currency other than the U.S. dollar; |
• | a holder of Public Shares that holds Public Shares as part of a hedge, straddle, constructive sale, conversion or other integrated transaction; or |
• | a person required to accelerate the recognition of any item of gross income with respect to Public Shares, as applicable, as a result of such income being recognized on an applicable financial statement. |
• | such gain is effectively connected with the conduct by you of a trade or business in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base that you maintain in the United States), in which case you generally will be subject to U.S. |
federal income tax on such gain at the same U.S. federal income tax rates applicable to a comparable U.S. Holder and, if you are a corporation for U.S. federal income tax purposes, also may be subject to an additional branch profits tax at a 30% rate or a lower applicable tax treaty rate under certain circumstances; |
• | you are an individual who is present in the United States for 183 days or more in the taxable year of the redemption and certain other conditions are met, in which case you will be subject to a 30% U.S. federal income tax; or |
• | we are or have been a “U.S. real property holding corporation” for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of the redemption or the period during which you held S Public Shares, and, in the case where our Public Shares are traded on an established securities market, you have owned, directly or constructively, more than 5% of our Public Shares at any time within the shorter of the five-year period or your holding period for our Public Shares. We do not believe that we are or have been a U.S. real property holding corporation. However, such determination is factual in nature and subject to change and no assurance can be provided as to whether we are or will be a U.S. real property holding corporation with respect to a non-U.S. holder following the Merger or redemption or at any future time. |
SWAG |
Post-Combination Company | |
Authorized and Outstanding Capital Stock | ||
SWAG Common Stock SWAG preferred stock. SWAG is currently authorized to issue 1,000,000 shares of undesignated preferred stock, par value $0.0001 per share. As of , 2022, there were no shares of SWAG preferred stock outstanding. |
Post-Combination Company common stock of the Post-Combination Company’s common stock issued and outstanding following consummation of the Business Combination. Post-Combination Company preferred stock | |
Special Meetings of Stockholders | ||
A special meeting of SWAG’s stockholders may be called only by the Chairman of SWAG’s board of directors, Chief Executive Officer, or SWAG’s board of directors pursuant to a resolution adopted by a majority of SWAG’s board of directors, and may not be called by any other person. | The Proposed Charter provides that special meetings of stockholders for any purpose or purposes may be called at any time only by or at the direction of the board of directors, the chairperson of the board of directors, the chief executive officer or the president. |
SWAG |
Post-Combination Company | |
Action by Written Consent | ||
Any action required or permitted to be taken by the SWAG stockholders must be effected by a duly called annual or special meeting of such stockholders and may not be effected by written consent of the stockholders other than with respect to the holders of Class B Stock with respect to which action may be taken by written consent. | Except with respect to the rights of any preferred stock provide in a certificate of designation from time to time, the Proposed Charter provides that any action required or permitted to be taken by the stockholders of the Post-Combination Company must be effected at any annual or special meeting of stockholders may not be taken by written consent in lieu of a meeting. | |
Quorum | ||
Board of Directors Stockholders |
Board of Directors Stockholders | |
Notice of Meetings | ||
Written notice stating the place, date, time and, in the case of special meetings, purpose, of each meeting of SWAG stockholders, shall be delivered not less than ten nor more than sixty days before the date of the meeting, to each stockholder entitled to vote at such meeting. Without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders given by SWAG shall be effective if given by a form of electronic transmission consented to by the stockholder to whom the notice is given. Any such consent shall be revocable by the stockholder by written notice to SWAG. Any such consent shall be deemed revoked if (1) SWAG is unable to deliver by electronic transmission two consecutive notices given by the corporation in accordance with such consent and (2) such inability becomes known to the secretary or an assistant secretary of SWAG or to the transfer agent, or other person responsible for the giving of notice; provided that the inadvertent failure to treat such inability as a revocation shall not invalidate any meeting or other action. Notice given by a form of electronic transmission shall be deemed given: (i) if by facsimile | Written notice stating the place, if any, date and time of each meeting, the means of remote communications, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, the record date for determining the stockholders entitled to vote at the meeting (if such date is different from the record date for stockholders entitled to notice of the meeting) and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be mailed to or transmitted electronically to each stockholder of record entitled to vote thereat as of the record date for determining the stockholders entitled to notice of the meeting. Unless otherwise provided by law, the charter or the bylaws, notice shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting as of the record date for determining the stockholders entitled to notice of the meeting. |
SWAG |
Post-Combination Company | |
telecommunication, when directed to a number at which the stockholder has consented to receive notice; (ii) if by electronic mail, when directed to an electronic mail address at which the stockholder has consented to receive notice; (iii) if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of (A) such posting and (B) the giving of such separate notice; and (iv) if by any other form of electronic transmission, when directed to the stockholder. | ||
Advance Notice Provisions | ||
SWAG’s charter and bylaws do not provide any specific advance notice requirement for business to be proposed by stockholders. | Business other than nomination of persons for election as directors The stockholder must (i) give timely notice thereof in proper written form to the Secretary of the Post-Combination Company, and (ii) provide any updates or supplements to such notice at the times and in the forms required by the Proposed Bylaws. To be timely, a stockholder’s notice must be received by the Secretary at the principal executive offices of the Post-Combination Company not less than ninety (90) or more than one-hundred twenty (120) days before the meeting. The public announcement of an adjournment or postponement of an annual meeting shall not commence a new time period (or extend any time period) for the giving of a stockholder’s notice. Additionally, the stockholder must provide information pursuant to the advance notice provisions in the Amended and Restated Bylaws. |
SWAG |
Post-Combination Company | |
Stockholder nominations of persons for election as directors For a nomination to be made by a stockholder, such stockholder must have given timely notice thereof in proper written form to the Secretary. To be timely, a stockholder’s notice to the Secretary must be received by the Secretary at the principal executive offices of the Post-Combination Company (i) in the case of an annual meeting, not later than the close of business not less than ninety (90) days nor more than one hundred and twenty (120) days prior to the first anniversary of the preceding year’s annual meeting or, if the number of directors to be elected to the board of directors is increased and the first public announcement naming all of the nominees for directors or specifying the size of the increased board of directors is less than 90 days prior to the meeting, the close of business on the 10th day following the day on which public announcement of the date of such meeting is first made; and (ii) in the case of a special meeting of stockholders called for the purpose of electing directors, not later than the close of business on the 10th day following the day on which public announcement of the date of the special meeting is first made by Post-Combination Company. In no event shall the public announcement of an adjournment or postponement of an annual meeting or special meeting commence a new time period (or extend any time period) for the giving of a stockholder’s notice. Additionally, the stockholder must provide information pursuant to the advance notice provisions in the Amended and Restated Bylaws. |
SWAG |
Post-Combination Company | |
Bylaw Amendments | ||
The bylaws may be amended, altered, or repealed and new bylaws adopted at any meeting of the board of directors by a majority vote. The fact that the power to adopt, amend, alter, or repeal the bylaws has been conferred upon the board of directors shall not divest the stockholders of the same powers. | The Proposed Charter provides that the board of directors is expressly authorized to adopt, amend or repeal the Amended and Restated Bylaws. In addition, the Post-Combination Company stockholders are expressly authorized to adopt, amend or repeal any bylaw with the affirmative vote of the holders of at least two-thirds (66 and 2/3%) of the voting power all the then outstanding shares of Post-Combination Company’s stock entitled to vote in an election of directors, voting together as a single class. | |
Charter Amendments | ||
Pursuant to the DGCL, the affirmative vote of the holders of a majority of the voting power of the SWAG Common Stock entitled to vote thereon is required to amend, alter, or repeal provisions of the SWAG Charter, subject to any additional vote required therein. In addition, for so long as any shares of Class B Stock shall remain outstanding, the, affirmative vote of the holders of a majority of the shares of Class B Stock outstanding, voting separately as a single class, shall be required to amend, alter or repeal any provision of the SWAG Charter, in a manner that would alter or change the powers, preferences or relative, participating, optional or other or special rights of the Class B Stock; and the affirmative vote of the holders of at least 65% of all outstanding shares of SWAG Common Stock, shall be required to amend Article IX prior to the consummation of a business combination. | The Proposed Charter provides that the following provisions in Proposed Charter may be amended, altered, repealed or rescinded only by the affirmative vote of the holders of at least 66 2/3% in voting power all the then outstanding shares of Post-Combination Company’s stock entitled to vote thereon, voting together as a single class: (i) Article IV of the Proposed Charter relating to the Post-Combination Company’s preferred stock; (ii) Article V of the Proposed Charter relating to the board of directors; (iii) Article VI of the Proposed Charter relating to relating to stockholder actions by written consent and annual and special stockholder meetings; (iv) Article VII of the Proposed Charter relating to limitation of director liability; (v) Article VIII of the Proposed Charter relating to indemnification; (vi) Article IX of the Proposed Charter relating to forum selection and (vii) Article X of the Proposed Charter relating to the amendment of the Proposed Charter. For any other amendment, the Proposed Charter applies Delaware law, which allows an amendment to a charter generally with the affirmative vote of a majority of the outstanding shares of voting stock entitled to vote thereon, voting together as a single class. | |
Size of Board, Election of Directors | ||
Size of Board |
Following the Business Combination, holders of the common stock shall have the exclusive right to vote for the election of directors, at any annual or special |
SWAG |
Post-Combination Company | |
Election of Directors At all meetings of stockholders for the election of directors at which a quorum is present, a plurality of the votes cast shall be sufficient to elect. |
meeting of the stockholders of the Post-Combination Company. Post-Combination Company stockholders shall elect directors, each of whom shall hold office for an initial term ending in either 2023, 2024 or 2025, and thereafter for a term of three years or until his or her successor is duly elected and qualified, subject to such director’s earlier death, resignation, disqualification or removal. No decrease in the number of directors shall shorten the term of any incumbent director. | |
Removal of Directors | ||
Any director or SWAG’s entire board of directors may be removed, but only for cause, by the affirmative vote of holders of a majority of the voting power of all then outstanding shares of SWAG capital stock entitled to vote generally in the election of directors, voting together as a single class. | Subject to the rights of holders of any series of preferred stock to elect directors, any director may be removed at any time, but only for cause and only by the affirmative vote of the holders of at least 66 2/3% of the voting power of the issued and outstanding shares of capital stock of the Post-Combination Company entitled to vote in the election of directors, voting together as a single class. | |
Board Vacancies and Newly Created Directorships | ||
Unless otherwise provided by law or the SWAG Charter, any newly created directorship or any vacancy occurring in SWAG’s board of directors for any cause may be filled by a majority of the remaining members of SWAG’s board of directors, even if such majority is less than a quorum, or by a sole remaining director (and not by stockholders), and any director so chosen shall hold office for the remainder of the full term of the class of directors to which the new directorship was added or in which the vacancy occurred and until his or her successor has been elected and qualified, subject, however, to such director’s earlier death, resignation, retirement, disqualification or removal. | Subject to the special rights of the holders of one or more outstanding series of preferred stock to elect directors, except as otherwise provided by law, any vacancies on the board of directors resulting from death, resignation, disqualification, retirement, removal or other causes and any newly created directorships resulting from any increase in the number of directors shall be filled exclusively by the affirmative vote of a majority of the directors then in office, even though less than a quorum, or by a sole remaining director (other than any directors elected by the separate vote of one or more outstanding series of preferred stock), and shall not be filled by the stockholders. Any director appointed in accordance with the preceding sentence shall hold office until the expiration of the term of the class to which such director shall have been appointed or until his or her earlier death, resignation, retirement, disqualification, or removal. | |
Corporate Opportunity/ Duties of Directors | ||
SWAG renounces any interest or expectation in, and any right to be informed of, any corporate opportunity, and in the event that any SWAG director (other than any | The Proposed Charter does not waive the Post-Combination Company’s right to any corporate opportunity. Under Delaware law, the standards of |
SWAG |
Post-Combination Company | |
director who is an executive officer of SWAG) acquires knowledge of a potential transaction that may be a corporate opportunity, to the fullest extent permitted by law, such director will have no duty (fiduciary or otherwise) or obligation to communicate or offer such corporate opportunity to SWAG and its subsidiaries and stockholders and will not be liable to SWAG and its subsidiaries and stockholders for breach of any fiduciary duty in respect of such corporate opportunity. | conduct for directors have developed through Delaware court case law. Generally, directors of Delaware corporations are subject to a duty of loyalty and a duty of care. The duty of loyalty requires directors to refrain from self-dealing, and the duty of care requires directors in managing the Post-Combination Company’s affairs to use that level of care which ordinarily careful and prudent persons would use in similar circumstances. When directors act consistently with their duties of loyalty and care, their decisions generally are presumed to be valid under the business judgment rule. | |
Exclusive Forum | ||
The SWAG Charter designates the Court of Chancery of the State of Delaware as the exclusive forum for (i) any derivative action brought by a stockholder on behalf of SWAG, (ii) any claim of breach of a fiduciary duty owed by any of SWAG’s directors, officers or employees of SWAG governed by the internal affairs doctrine, (iii) any claim against SWAG, its directors, officers or employees arising under its charter, bylaws or the DGCL and (iv) any claim against SWAG governed by the internal affairs doctrine, except for claims (A) as to which the Delaware Chancery Court determines there is an indispensable party not subject to the jurisdiction of the Delaware Chancery Court and (B) brought under the Securities Act, Exchange Act or for which federal courts have exclusive jurisdiction. The SWAG Charter further provides that the federal courts have exclusive jurisdiction over suits brought to enforce any liability or duty created by the Exchange Act or for which the federal courts have exclusive jurisdiction. | Unless the Post-Combination Company consents in writing to the selection of an alternative forum, the Post-Combination Company’s charter designates the Court of Chancery of the State of Delaware (or in the event that the Chancery Court does not have jurisdiction, the federal district court for the District of Delaware or other state courts of the State of Delaware) to the fullest extent permitted by applicable law, as the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative action or proceeding brought on behalf of the Post-Combination Company, (ii) any claim of breach of a fiduciary duty owed by any of the Post-Combination Company’s directors, officers or employees to the Post-Combination Company or its stockholders, (iii) any claim against the Post-Combination Company arising pursuant to any provision of the Post-Combination Company’s charter, bylaws or the DGCL, or (iv) any action asserting a claim against the Post-Combination Company, its directors, officers or employees, as governed by the internal affairs doctrine. The Proposed Charter designates the federal district courts of the United States of America as the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, including all causes of action asserted against any defendant to such complaint. Notwithstanding the foregoing, the forum selection provisions of the Proposed Charter will not apply to any suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts of the United States have exclusive jurisdiction. |
SWAG |
Post-Combination Company | |
Limitation of Liability of Directors and Officers | ||
A SWAG director shall not be personally liable to SWAG or its stockholders for monetary damages for breach of fiduciary duty owed to SWAG and its stockholders. Neither the amendment nor appeal of this provision in the SWAG Charter nor, to the fullest extent permitted by the DGCL, any modification of law shall adversely affect any right or protection of a SWAG director in respect of any act or omission occurring prior to the time of such amendment, modification or repeal. | No director of the Post-Combination Company shall be personally liable to the Post-Combination Company or its stockholders for monetary damages for breach of fiduciary duty owed to the Post-Combination Company and its stockholders, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL as the same exists or hereafter may be amended. Neither the amendment, repeal or modification of this provision in the Proposed Charter, nor to the fullest extent permitted by the DGCL, any modification of law, shall adversely affect any right or protection of a director of the Post-Combination Company with respect to any act or omission occurring prior to such amendment, repeal or modification. If the DGCL is amended after approval by the stockholders of this provision to authorize corporate action further eliminating or limiting personal liability of directors, then the liability of directors of the Post-Combination Company shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended. | |
Indemnification and Advancement Directors, Officers, Employees and Agents | ||
SWAG will indemnify any person for any proceeding by reason of being a director or officer of SWAG or, while a director or officer, is or was serving at the request of SWAG as a director, officer, employee, agent or trustee of another corporation or of a partnership, joint venture, trust or other enterprise if such proceeding or part thereof was authorized by SWAG’s board of directors. The right to indemnification covers all expense, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection with such proceeding. It also includes the right to be paid by SWAG the expenses (including attorney’s fees) incurred in defending or otherwise participating in any such proceeding in advance of its final disposition, provided, however, that, if the DGCL requires, an advancement of expenses will be made only upon delivery to SWAG of an undertaking, by or on behalf of the indemnitee, to repay all amounts so advanced if it will ultimately be determined by final judicial decision from which there is |
The Post-Combination Company will indemnify and hold harmless, to the fullest extent permitted by the DGCL, any person for any proceeding by reason of the fact that such person is or was a director or officer of the Post-Combination Company or, while a director or officer, is or was serving at the request of the Post-Combination Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise if such proceeding or part thereof was authorized by the Post-Combination Company’s board of directors or the Post-Combination Company, provided, however, that this amount shall be reduced by any amount that such person may collect as indemnification or advancement of expenses from such other corporation, partnership, joint venture, trust, enterprise or non-profit enterprise.The Post-Combination Company has the power to indemnify and hold harmless, to the fullest extent permitted by applicable law, any employee or agent of the Post-Combination Company who was or is made a party or is otherwise involved in a proceeding |
SWAG |
Post-Combination Company | |
no further right to appeal that the indemnitee is not entitled to be indemnified for the expenses. Such rights will continue as to an indemnitee who has ceased to be a director, officer, employee or agent and will inure to the benefit of his or her heirs, executors and administrators. Notwithstanding the foregoing, except for proceedings to enforce rights to indemnification and advancement of expenses, SWAG shall indemnify and advance expenses to an indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the SWAG’s board of directors. |
by reason of the fact that he or she, or a person whom the employee or agent was made a legal representative, is or was an employee or agent of the Post-Combination Company or is or was serving at the request of the Post-Combination Company as a director, officer, employee or agent against all liability and loss suffered and expenses reasonably incurred by such person in connection with any such proceeding. The right to indemnification covers all liability and loss suffered and expenses (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) actually and reasonably incurred by such person in connection with any such proceeding, provided, however, that any payment or pre-payment of expenses paid shall be made only upon receipt of an undertaking by the indemnitee to repay all amounts advanced if it should be determined that the indemnitee is not entitled to be indemnified for the expenses.Such rights will continue as to an indemnitee who has ceased to be a director, officer, employee or agent and will inure to the benefit of the estate, his or her heirs, executors, administrators, legatees and distributees. |
• | at any time after the warrants become exercisable, |
• | upon not less than 30 days’ prior written notice of redemption to each warrant holder, |
• | if, and only if, the reported last sale price of the shares of Post-Combination Company common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations), for any 20 trading days within a 30 trading day period commencing at any time after the warrants become exercisable and ending on the third business day prior to the notice of redemption to warrant holders; and |
• | if, and only if, there is a current registration statement in effect with respect to the shares of Post-Combination Company common stock underlying such warrants. |
Page |
||||
Audited Financial Statements of Software Acquisition Group Inc. III |
||||
F-2 | ||||
Consolidated financial statements: |
||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
F-7 | ||||
Unaudited Financial Statements of Software Acquisition Group Inc. III |
||||
Consolidated financial statements: |
||||
F-25 | ||||
F-26 | ||||
F-27 | ||||
F-28 | ||||
F-29 | ||||
Audited Financial Statements of Branded Online, Inc. and Subsidiaries dba Nogin: |
||||
F-49 | ||||
F-50 | ||||
F-51 | ||||
F-52 | ||||
F-53 | ||||
F-54 | ||||
Unaudited Financial Statements of Branded Online, Inc. and Subsidiaries dba Nogin: |
||||
F-79 | ||||
F-80 | ||||
F-81 | ||||
F-82 | ||||
F-83 |
ASSETS |
||||
Current assets |
||||
Cash |
$ | |||
Prepaid expenses and other current assets |
||||
Total Current Assets |
||||
Marketable securities held in Trust Account |
||||
TOTAL ASSETS |
$ |
|||
LIABILITIES AND STOCKHOLDERS’ DEFICIT |
||||
Current liabilities |
||||
Accrued expenses |
$ | |||
Total Current Liabilities |
||||
Deferred underwriting fee payable |
||||
Total Liabilities |
||||
Commitments and Contingencies (See Note 6) |
||||
Class A common stock subject to possible redemption, |
||||
Stockholders’ Deficit |
||||
Preferred stock, $ |
||||
Class A common stock, $ |
||||
Class B common stock, $ |
||||
Additional paid-in capital |
||||
Accumulated deficit |
( |
) | ||
Total Stockholders’ Deficit |
( |
) | ||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT |
$ |
|||
Operating and formation costs |
$ | |||
Loss from operations |
( |
) | ||
Other income/(loss): |
||||
Interest earned on marketable securities held in Trust Account |
||||
Interest income - bank |
||||
Change in fair value of over-allotment option liability |
( |
) | ||
Fair value of forfeited over-allotment option |
||||
Total other loss, net |
( |
) | ||
Net loss |
$ |
( |
) | |
Basic and diluted weighted average shares outstanding, Class A common stock |
||||
Basic and diluted net loss per share, Class A |
$ |
( |
) | |
Basic and diluted weighted average shares outstanding, Class B common stock |
||||
Basic and diluted net loss per share, Class B |
$ |
( |
) | |
Class A Common Stock |
Class B Common Stock |
Additional Paid-in Capital |
Accumulated Deficit |
Total Stockholders’ Equity (Deficit) |
||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
|||||||||||||||||||||||||
Balance – January 5, 2021 (inception) |
— | $ | — | $ | |
$ | |
$ | |
$ | |
|||||||||||||||||
Issuance of Class B common stock to Sponsor |
— | — | ||||||||||||||||||||||||||
Net loss |
— | — | — | ( |
) | ( |
) | |||||||||||||||||||||
Balance – March 31, 2021 |
— | $ | — | $ |
$ |
$ |
( |
) |
$ |
|||||||||||||||||||
Net loss |
— | — | — | |||||||||||||||||||||||||
Balance – June 30, 2021 |
— | $ | — | $ |
$ |
$ |
( |
) |
$ |
|||||||||||||||||||
Sale of |
— | — | — | |||||||||||||||||||||||||
Proceed allocated to Public Warrants |
— | — | — | |||||||||||||||||||||||||
Allocated value of transaction costs to warrants |
— | — | — | ( |
) | ( |
) | |||||||||||||||||||||
Adjustment of carrying value to initial redemption value |
— | — | — | ( |
) | ( |
) | ( |
) | |||||||||||||||||||
Sale of |
— | — | — | |||||||||||||||||||||||||
Forfeiture of Founder Shares |
— | — | ( |
) | ( |
) | ||||||||||||||||||||||
Net loss |
— | — | — | ( |
) | ( |
) | |||||||||||||||||||||
Balance – September 30, 2021 |
— | $ |
— |
$ |
$ |
$ |
( |
) |
$ |
( |
) | |||||||||||||||||
Net Loss |
— | — | — | ( |
) | ( |
) | |||||||||||||||||||||
Balance – December 31, 2021 |
— | $ | — | $ |
$ | $ |
( |
) |
$ |
( |
) | |||||||||||||||||
Cash Flows from Operating Activities: |
||||
Net loss |
$ | ( |
) | |
Adjustments to reconcile net loss to net cash used in operating activities: |
||||
Interest earned on marketable securities held in Trust Account |
( |
) | ||
Change in fair value of over-allotment liability |
||||
Fair value of forfeited over-allotment optio n |
( |
) | ||
Changes in operating assets and liabilities: |
||||
Prepaid expenses and other current assets |
( |
) | ||
Accrued expenses |
||||
Net cash used in operating activities |
( |
) | ||
Cash Flows from Investing Activities: |
||||
Investment of cash in Trust Account |
( |
) | ||
Net cash used in investing activities |
( |
) | ||
Cash Flows from Financing Activities: |
||||
Proceeds from issuance of Class B common stock to Sponsor |
||||
Proceeds from sale of Units, net of underwriting discounts paid |
||||
Proceeds from sale of Private Placements Warrants |
||||
Proceeds from promissory note – related party |
||||
Repayment of promissory note – related party |
( |
) | ||
Payment of offering costs |
( |
) | ||
Net cash provided by financing activities |
||||
Net Change in Cash |
||||
Cash – Beginning of period |
||||
Cash – End of period |
$ |
|||
Non-Cash investing and financing activities: |
||||
Initial value of over-allotment option liability |
$ | |||
Elimination of over-allotment option liability |
$ | ( |
) | |
Adjustment of carrying value to initial redemption value |
$ | |||
Deferred underwriting fee payable |
$ | |||
Forfeiture of Founder Shares |
$ | ( |
) | |
Gross proceeds |
$ | |
||
Less: |
||||
Proceeds Allocated to Public Warrants |
( |
) | ||
Class A common stock issuance costs |
( |
) | ||
Add: |
||||
Adjustment of carrying value to initial redemption value |
||||
Class A common stock subject to possible redemption |
$ | |||
For the Period from January 5, 2021 (Inception) Through December 31, 2021 |
||||||||
Class A |
Class B |
|||||||
Basic and diluted net loss per common share |
||||||||
Numerator: |
||||||||
Allocation of net loss, as adjusted |
$ | ( |
) | $ | ( |
) | ||
Denominator: |
||||||||
Basic and diluted weighted average shares outstanding |
||||||||
Basic and diluted net loss per ordinary share |
$ | ( |
) | $ | ( |
) |
• | in whole and not in part; |
• | at a price of $ |
• | upon not less than |
• | if, and only if, the reported closing price of the Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any |
December 31, 2021 |
||||
Deferred tax assets (liability) |
||||
Net operating loss carryforward |
$ | |||
Startup/Organization Expenses |
||||
Total deferred tax assets (liability) |
||||
Valuation Allowance |
( |
) | ||
Deferred tax assets (liability), net of allowance |
$ | |||
December 31, 2021 |
||||
Federal |
||||
Current |
$ | |||
Deferred |
( |
) | ||
State and Local |
||||
Current |
||||
Deferred |
||||
Change in valuation allowance |
||||
Income tax provision |
$ | |||
December 31, 2021 |
||||
Statutory federal income tax rate |
% | |||
State taxes, net of federal tax benefit |
% | |||
Change in fair value of over-allotment liability |
( |
)% | ||
Valuation allowance |
( |
)% | ||
Income tax provision |
% | |||
Level 1: |
Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. |
Level 2: |
Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. |
Level 3: |
Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. |
Description |
Level |
December 31, 2021 |
||||||
Assets: |
||||||||
Marketable securities held in Trust Account |
1 | $ |
March 31, 2022 |
December 31, 2021 |
|||||||
(Unaudited) |
||||||||
ASSETS |
||||||||
Current assets |
||||||||
Cash |
$ | $ | ||||||
Prepaid expenses |
||||||||
|
|
|
|
|||||
Total Current Assets |
||||||||
Prepaid expenses, non-current |
||||||||
Cash and Marketable securities held in Trust Account |
||||||||
|
|
|
|
|||||
TOTAL ASSETS |
$ |
$ |
||||||
|
|
|
|
|||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT |
||||||||
Current Liabilities |
||||||||
Accrued expenses |
$ | $ | ||||||
|
|
|
|
|||||
Total Current Liabilities |
||||||||
Promissory note - related party |
||||||||
Deferred underwriting fee payable |
||||||||
|
|
|
|
|||||
Total Liabilities |
||||||||
|
|
|
|
|||||
Commitments and Contingencies (Note 6) |
||||||||
Class A common stock subject to possible redemption, |
||||||||
Stockholders’ Deficit |
— | |||||||
Preferred stock, $ |
||||||||
Class A common stock, $ |
||||||||
Class B common stock, $ |
||||||||
Additional paid-in capital |
||||||||
Accumulated deficit |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total Stockholders’ Deficit |
( |
) |
( |
) | ||||
|
|
|
|
|||||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT |
$ |
$ |
||||||
|
|
|
|
Three Months Ended March 31, 2022 |
For the Period from January 5, 2021 (Inception) Through March 31, 2021 |
|||||||
Operating and formation costs |
$ | $ | ||||||
|
|
|
|
|||||
Loss from operations |
( |
) |
( |
) | ||||
Other income: |
||||||||
Interest earned on marketable securities held in Trust Account |
||||||||
|
|
|
|
|||||
Total other income |
||||||||
|
|
|
|
|||||
Net loss |
$ |
( |
) |
$ |
( |
) | ||
|
|
|
|
|||||
Basic and diluted weighted average shares outstanding, Class A common stock |
||||||||
|
|
|
|
|||||
Basic and diluted net loss per share, Class A |
$ |
( |
) |
$ | ||||
|
|
|
|
|||||
Basic and diluted weighted average shares outstanding, Class B common stock |
||||||||
|
|
|
|
|||||
Basic and diluted net loss per share, Class B |
$ |
( |
) |
$ |
( |
) | ||
|
|
|
|
Class A Common Stock |
Class B Common Stock |
Additional Paid-in |
Accumulated |
Total Stockholders’ |
||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
Capital |
Deficit |
Deficit |
||||||||||||||||||||||
Balance – January 1, 2022 |
$ |
$ |
$ |
$ |
( |
) |
$ |
( |
) | |||||||||||||||||||
Net loss |
— | — | — | ( |
) | ( |
) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance – March 31, 2022 |
$ |
$ |
$ |
$ |
( |
) |
$ |
( |
) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Common Stock |
Class B Common Stock |
Additional Paid-in |
Accumulated |
Total Stockholders’ |
||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
Capital |
Deficit |
Equity |
||||||||||||||||||||||
Balance – January 5, 2021 (inception) |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||||||||||
Issuance of Class B common stock to Sponsor |
— | — | ||||||||||||||||||||||||||
Net loss |
— | — | — | ( |
) | ( |
) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance – March 31, 2021 |
$ |
$ |
$ |
$ |
( |
) |
$ |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2022 |
For the Period from January 5, 2021 (Inception) through March 31, 2021 |
|||||||
Cash Flows from Operating Activities: |
||||||||
Net loss |
$ | ( |
) | $ | ( |
) | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
Interest earned on marketable securities held in Trust Account |
( |
) | ||||||
Changes in operating assets and liabilities: |
||||||||
Prepaid expenses |
||||||||
Accrued expenses |
||||||||
|
|
|
|
|||||
Net cash used in operating activities |
( |
) |
||||||
|
|
|
|
|||||
Cash Flows from Financing Activities: |
||||||||
Proceeds from issuance of Class B common stock to Sponsor |
||||||||
Proceeds from promissory note – related party |
||||||||
Payment of offering costs |
( |
) | ||||||
|
|
|
|
|||||
Net cash provided by financing activities |
||||||||
|
|
|
|
|||||
Net Change in Cash |
( |
) |
||||||
Cash – Beginning |
||||||||
|
|
|
|
|||||
Cash – Ending |
$ |
$ |
||||||
|
|
|
|
|||||
Non-Cash Investing and Financing Activities: |
||||||||
Offering costs included in accrued offering costs |
$ | $ | ||||||
|
|
|
|
Gross proceeds |
$ | |||
Less: |
||||
Proceeds allocated to Public Warrants |
( |
) | ||
Class A common stock issuance costs |
( |
) | ||
Add: |
||||
Adjustment of carrying value to initial redemption value |
||||
|
|
|||
Class A common stock subject to possible redemption |
$ | |||
|
|
Three Months Ended March 31, 2022 |
For the Period from January 5, 2021 (Inception) Through March 31, 2021 |
|||||||||||||||
Class A |
Class B |
Class A |
Class B |
|||||||||||||
Basic and diluted net loss per common share |
||||||||||||||||
Numerator: |
||||||||||||||||
Allocation of net loss, as adjusted |
$ | ( |
) | $ | ( |
) | $ | $ | ( |
) | ||||||
Denominator: |
||||||||||||||||
Basic and diluted weighted average shares outstanding |
||||||||||||||||
Basic and diluted net loss per ordinary share |
$ | ( |
) | $ | ( |
) | $ | $ | ( |
) |
• | in whole and not in part; |
• | at a price of $ |
• | upon not less than |
• | if, and only if, the reported closing price of the Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any |
Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |
Level 3: | Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. |
Description |
Level |
March 31, 2022 |
December 31, 2021 |
|||||||||
Assets: |
||||||||||||
Marketable securities held in Trust Account |
1 | $ | $ |
December 31, 2021 |
December 31, 2020 |
|||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash |
$ | 1,071 | $ | 16,168 | ||||
Accounts receivable, net |
1,977 | 4,027 | ||||||
Related party receivables |
5,356 | — | ||||||
Inventory |
22,777 | 137 | ||||||
Prepaid expenses and other current assets |
2,915 | 1,024 | ||||||
|
|
|
|
|||||
Total current assets |
34,096 | 21,356 | ||||||
|
|
|
|
|||||
Restricted cash |
3,500 | — | ||||||
Property and equipment, net |
1,789 | 1,656 | ||||||
Intangible assets, net |
1,112 | 412 | ||||||
Investment in unconsolidated affiliates |
13,570 | — | ||||||
Other non-current asset |
664 | 417 | ||||||
|
|
|
|
|||||
Total assets |
$ | 54,731 | $ | 23,841 | ||||
|
|
|
|
|||||
LIABILITIES, CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 16,098 | $ | 6,318 | ||||
Due to clients |
5,151 | 13,348 | ||||||
Accrued expenses and other liabilities |
14,018 | 3,764 | ||||||
|
|
|
|
|||||
Total current liabilities |
35,267 | 23,430 | ||||||
|
|
|
|
|||||
Paycheck Protection Program loan payable |
— | 2,266 | ||||||
Line of credit |
348 | — | ||||||
Long-term note payable, net |
19,249 | — | ||||||
Deferred tax liabilities |
1,174 |
— |
||||||
Other long-term liabilities |
734 | 174 | ||||||
|
|
|
|
|||||
Total liabilities |
56,772 |
25,870 |
||||||
|
|
|
|
|||||
Commitments and contingencies (Note 18) |
||||||||
CONVERTIBLE REDEEMABLE PREFERRED STOCK |
||||||||
Series A convertible, redeemable preferred stock, $0.0001 par value, 2,042,483 shares authorized, issued and outstanding, as of December 31, 2021 and December 31, 2020 |
4,687 | 4,687 | ||||||
Series B convertible, redeemable preferred stock, $0.0001 par value, 1,600,000 shares authorized as of December 31, 2021 and December 31, 2020 respectively; 1,459,462 shares issued and outstanding |
6,502 | 6,502 | ||||||
STOCKHOLDERS’ DEFICIT |
||||||||
Common stock, $0.0001 par value 14,000,000 shares authorized; 9,129,358 shares issued and outstanding as of December 31, 2021 and December 31, 2020 |
1 | 1 | ||||||
Additional paid-in capital |
4,361 | 4,308 | ||||||
Treasury stock |
(1,330 | ) | (1,330 | ) | ||||
Accumulated deficit |
(16,262 | ) | (16,197 | ) | ||||
|
|
|
|
|||||
Total stockholders’ deficit |
(13,230 | ) | (13,218 | ) | ||||
|
|
|
|
|||||
Total liabilities, convertible redeemable preferred stock and stockholders’ deficit |
$ | 54,731 | $ | 23,841 | ||||
|
|
|
|
Year Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Net service revenue |
$ | 41,866 | $ | 45,517 | $ | 40,954 | ||||||
Net product revenue |
51,346 | — | — | |||||||||
Net service revenue from related parties |
8,136 | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total net revenue |
101,348 | 45,517 | 40,954 | |||||||||
Operating costs and expenses: |
||||||||||||
Cost of services |
24,174 | 17,997 | 13,197 | |||||||||
Cost of product revenue |
20,431 | — | — | |||||||||
Sales and marketing |
1,772 | 1,094 | 1,433 | |||||||||
Research and development |
5,361 | 4,289 | 5,021 | |||||||||
General and administrative |
55,369 | 23,865 | 23,387 | |||||||||
Depreciation and amortization |
520 | 415 | 207 | |||||||||
|
|
|
|
|
|
|||||||
Total operating costs and expenses |
107,627 | 47,660 | 43,245 | |||||||||
|
|
|
|
|
|
|||||||
Operating loss |
(6,279 | ) | (2,143 | ) | (2,291 | ) | ||||||
Interest expense |
(926 | ) | (225 | ) | (164 | ) | ||||||
Change in fair value of unconsolidated affiliate |
4,937 | — | — | |||||||||
Other income |
3,378 | 1,418 | 2,480 | |||||||||
|
|
|
|
|
|
|||||||
Income (loss) before income taxes |
1,110 | (950 | ) | 25 | ||||||||
Provision for income taxes |
1,175 | 190 | 25 | |||||||||
|
|
|
|
|
|
|||||||
Net loss |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
|
|
|
|
|
|
|||||||
Net loss per common share – basic and diluted |
$ | (0.01 | ) | $ | (0.12 | ) | $ | — | ||||
Weighted average shares outstanding – basic and diluted |
9,129,358 | 9,129,358 | 9,130,726 |
Convertible Redeemable Preferred Stock |
Common Stock |
Additional Paid-in Capital |
Treasury Stock |
Accumulated Deficit |
Total Stockholders’ Deficit |
|||||||||||||||||||||||||||||||||||
Series A |
Series B |
|||||||||||||||||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
Shares |
Amount |
|||||||||||||||||||||||||||||||||||
Balance, January 1, 2019 |
2,042,483 | $ | 4,687 | 1,459,462 | $ | 6,502 | 9,152,060 | $ | 1 | $ | 4,282 | $ | (1,280 | ) | $ | (15,161 | ) | $ | (12,158 | ) | ||||||||||||||||||||
Repurchase of common stock |
— | — | — | — | (22,702 | ) | — | (104 | ) | (50 | ) | 104 | (50 | ) | ||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||
Balance, December 31, 2019 |
2,042,483 | $ | 4,687 | 1,459,462 | $ | 6,502 | 9,129,358 | $ | 1 | $ | 4,178 | $ | (1,330 | ) | $ | (15,057 | ) | $ | (12,208 | ) | ||||||||||||||||||||
Stock-based compensation |
— | — | — | — | — | — | 130 | — | — | 130 | ||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | (1,140 | ) | (1,140 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance, December 31, 2020 |
2,042,483 | 4,687 | 1,459,462 | 6,502 | 9,129,358 | 1 | 4,308 | (1,330 | ) | (16,197 | ) | (13,218 | ) | |||||||||||||||||||||||||||
Stock-based compensation |
— | — | — | — | — | — | 53 | — | — | 53 | ||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | (65 | ) | (65 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance, December 31, 2021 |
2,042,483 | $ | 4,687 | 1,459,462 | $ | 6,502 | 9,129,358 | $ | 1 | $ | 4,361 | $ | (1,330 | ) | $ | (16,262 | ) | $ | (13,230 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||||||
Net loss |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
Adjustments to reconcile net loss to net cash provided by operating activities: |
||||||||||||
Depreciation and amortization |
520 | 415 | 207 | |||||||||
Amortization of debt issuance costs |
137 | — | — | |||||||||
Amortization of contract acquisition costs |
361 | 667 | 623 | |||||||||
Loss on disposal of assets |
74 | — | — | |||||||||
Stock-based compensation |
53 | 130 | — | |||||||||
Deferred income taxes |
1,174 | — | — | |||||||||
Fair value adjustment on joint ventures |
(4,937 | ) | — | — | ||||||||
Fair value adjustment on warrant liability |
(177 | ) | — | |||||||||
Gain on extinguishment of PPP loan payable |
(2,266 | ) | — | — | ||||||||
Changes in operating assets and liabilities: |
||||||||||||
Accounts receivable |
2,050 | (1,533 | ) | (648 | ) | |||||||
Related party receivables |
(5,356 | ) | — | — | ||||||||
Inventory |
(22,641 | ) | — | — | ||||||||
Prepaid expenses and other current assets |
(1,891 | ) | (194 | ) | (550 | ) | ||||||
Other non-current assets |
(247 | ) | 11 | (187 | ) | |||||||
Accounts payable |
9,780 | 1,508 | 2,912 | |||||||||
Due to clients |
(8,197 | ) | 504 | 8,002 | ||||||||
Accrued expenses and other liabilities |
10,255 | 1,211 | (925 | ) | ||||||||
|
|
|
|
|
|
|||||||
Net cash (used in) provided by operating activities |
(21,373 | ) | 1,579 | 9,434 | ||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||||||
Purchases of property and equipment |
(686 | ) | (1,578 | ) | (124 | ) | ||||||
Purchases of software |
(1,103 | ) | — | (38 | ) | |||||||
Acquisition of investment in unconsolidated affiliates |
(8,633 | ) | — | — | ||||||||
|
|
|
|
|
|
|||||||
Net cash used in investing activities |
(10,422 | ) | (1,578 | ) | (162 | ) | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||||||
Proceeds from loan payable |
20,000 | 2,266 | — | |||||||||
Payment of debt issuance costs |
(150 | ) | — | 75,848 | ||||||||
Proceeds from line of credit |
173,896 | 115,814 | (75,848 | ) | ||||||||
Repayments of line of credit |
(173,548 | ) | (115,814 | ) | (50 | ) | ||||||
|
|
|
|
|
|
|||||||
Net cash provided by financing activities |
20,198 | 2,266 | (50 | ) | ||||||||
|
|
|
|
|
|
|||||||
NET (DECREASE) INCREASE IN CASH AND RESTRICTED CASH |
(11,597 | ) | 2,267 | 9,222 | ||||||||
Beginning of year |
16,168 | 13,901 | 4,679 | |||||||||
|
|
|
|
|
|
|||||||
End of year |
$ | 4,571 | $ | 16,168 | $ | 13,901 | ||||||
|
|
|
|
|
|
|||||||
SUPPLEMENTAL CASH FLOW INFORMATION |
||||||||||||
Issuance of warrants with debt |
$ | 738 | $ | — | $ | — | ||||||
Cash paid for taxes |
$ | 195 | $ | 9 | $ | 24 | ||||||
Cash paid for the interest |
$ | 444 | $ | 225 | $ | 164 |
1. |
OVERVIEW |
2. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
As of December 31, | ||||||||
2021 |
2020 |
|||||||
Balance at beginning of period |
$ | 428 | $ | 379 | ||||
Additions to allowance for credit losses |
433 | 437 | ||||||
Cash receipts |
— | — | ||||||
Write-offs |
(455 | ) | (388 | ) | ||||
|
|
|
|
|||||
Balance at end of period |
$ | 406 | $ | 428 | ||||
|
|
|
|
Estimated Useful Life (Years) | ||
Furniture and fixtures |
5 | |
Computer equipment and software |
3 to 7 | |
Leasehold Improvement |
Lesser of economic useful life (typically 10 years) or original lease term |
• | Identification of a contract with a customer, |
• | Identification of the performance obligations in the contract, |
• | Determination of the transaction price, |
• | Allocation of the transaction price to the performance obligations in the contract, and |
• | Recognition of revenue when or as the performance obligations are satisfied. |
As of December 31, |
||||||||
2021 |
2020 |
|||||||
Balance at beginning of period |
$ | 598 | $ | 350 | ||||
Additions to the reserve |
1,559 | 598 | ||||||
Deductions from the reserve |
(318 | ) | (350 | ) | ||||
|
|
|
|
|||||
Balance at end of period |
$ | 1,839 | $ | 598 | ||||
|
|
|
|
• | Level 1 - |
• | Level 2 - |
• | Level 3 - |
3. |
PROPERTY AND EQUIPMENT |
As of December 31, | ||||||||
2021 |
2020 |
|||||||
Furniture and equipment |
$ | 2,160 | $ | 1,862 | ||||
Leasehold Improvements |
536 | 520 | ||||||
|
|
|
|
|||||
Property, plant, and equipment—gross |
2,696 | 2,382 | ||||||
Less accumulated depreciation |
(907 | ) | (726 | ) | ||||
|
|
|
|
|||||
Property and equipment—net |
$ | 1,789 | $ | 1,656 | ||||
|
|
|
|
4. |
INTANGIBLE ASSETS |
As on December 31, | ||||||||
2021 |
2020 |
|||||||
Contract acquisition cost |
$ | 2,000 | $ | 2,000 | ||||
Software |
1,174 | 320 | ||||||
|
|
|
|
|||||
3,174 | 2,320 | |||||||
Less: Accumulated amortization |
(2,062 | ) | (1,908 | ) | ||||
|
|
|
|
|||||
Intangible assets-net |
$ | 1,112 | $ | 412 | ||||
|
|
|
|
5. |
INVESTMENT IN UNCONSOLIDATED AFFILIATES |
Modcloth |
IPCO |
|||||||
Net revenue |
$ | 25,486 | $ | 133 | ||||
Gross margin |
$ | 9,326 | $ | 98 | ||||
Net loss |
$ | (8,288 | ) | $ | (8 | ) | ||
Current assets |
$ | 5,009 | $ | 2,596 | ||||
Long term assets |
$ | 6,303 | $ | 6,130 | ||||
Current liabilities |
$ | 8,539 | $ | 1,699 | ||||
Long term liabilities |
$ | 5,698 | $ | — |
• | Discounted Cash Flow |
• | Guideline Public Company Method |
• | Guideline Transaction Method – |
Balance as of January 1, 2020 |
$ | — | ||
Contribution |
— | |||
Change in fair value |
— | |||
Balance as of December 31, 2020 |
$ | — | ||
Contribution |
1,500 | |||
Change in fair value |
4,937 | |||
|
|
|||
Balance as of December 31, 2021 |
$ | 6,437 | ||
|
|
6. |
LONG-TERM DEBT |
First Tranche Notes |
$ | 10,000 | ||
First Tranche Notes Exit Fee |
600 | |||
Second Tranche Notes |
5,000 | |||
Second Tranche Notes Exit Fee |
300 | |||
Third Tranche Notes |
5,000 | |||
Third Tranche Notes Exit Fee |
50 | |||
|
|
|||
20,950 | ||||
Less: Unamortized Exit Fee payment |
(884 | ) | ||
Less: Unamortized warrant discount |
(678 | ) | ||
Less: Unamortized debt issuance costs |
(139 | ) | ||
|
|
|||
$ | 19,249 | |||
|
|
2022 |
$ | — | ||
2023 |
6,022 | |||
2024 |
5,000 | |||
2025 |
5,000 | |||
2026 |
4,928 | |||
Thereafter |
— | |||
|
|
|||
Total |
$ | 20,950 | ||
|
|
7. |
WARRANTS |
December 31, 2021 |
Grant Date August 11, 2021 |
|||||||
Common Stock Fair Value Per Share |
$ | 16.81 | $ | 22.13 | ||||
Exercise Price Per Share |
$ | 0.01 | $ | 0.01 | ||||
Volatility |
75.7 | % | 75.7 | % | ||||
Risk-free rate |
0.53 | % | 0.53 | % | ||||
Expected Dividend Rate |
0.0 | % | 0.0 | % |
Balance as of January 1, 2020 |
$ | — | ||
Fair value of Warrants at inception of Note Agreement |
— | |||
Change in fair value of warrant liability |
— | |||
|
|
|||
Balance as of December 31, 2020 |
$ | — | ||
Fair value of Warrants at inception of Note Agreement |
738 | |||
Change in fair value of warrant liability |
(177 | ) | ||
|
|
|||
Balance as of December 31, 2021 |
$ | 561 | ||
|
|
8. |
INCOME TAXES |
For the Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Current: |
||||||||||||
Federal |
$ | — | $ | — | $ | — | ||||||
State |
1 | 190 | 25 | |||||||||
|
|
|
|
|
|
|||||||
Total |
1 | 190 | 25 | |||||||||
|
|
|
|
|
|
|||||||
Deferred: |
||||||||||||
Federal |
371 | — | — | |||||||||
State |
803 | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total |
$ | 1,174 | — | — | ||||||||
|
|
|
|
|
|
|||||||
Income tax expense |
$ | 1,175 | $ | 190 | $ | 25 | ||||||
|
|
|
|
|
|
For the Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
U.S. federal statutory tax rate |
21 | % | 21 | % | 21 | % | ||||||
State income taxes, net of federal benefit |
57 | % | (20 | )% | 78 | % | ||||||
PPP Loan |
(43 | )% | — | % | — | |||||||
Return to provision |
11 | % | 11 | % | 268 | % | ||||||
Other Adjustments |
2 | % | — | — | ||||||||
Change in Valuation allowance |
58 | % | (32 | )% | (268 | )% | ||||||
|
|
|
|
|
|
|||||||
Effective tax rate |
106 | % | (20 | )% | 99 | % | ||||||
|
|
|
|
|
|
For the Years Ended December 31, |
||||||||
2021 |
2020 |
|||||||
Deferred Tax Assets: |
||||||||
Net operating loss and other tax attributes carryforwards |
$ | 4,950 | $ | 2,654 | ||||
Reserve for doubtful accounts |
62 | 120 | ||||||
Accrued Expenses |
343 | 277 | ||||||
Deferred state tax |
169 | — | ||||||
163(j) interest limitation |
166 | — | ||||||
Amortization |
58 | 189 | ||||||
|
|
|
|
|||||
$ | 5,748 | $ | 3,240 | |||||
|
|
|
|
|||||
Deferred Tax Liabilities |
||||||||
Depreciation |
$ | (73 | ) | $ | — | |||
Other deferred tax liabilities |
(26 | ) | — | |||||
Unrealized gain (loss) on joint venture |
(2,541 | ) | — | |||||
|
|
|
|
|||||
(2,640 | ) | — | ||||||
|
|
|
|
|||||
Valuation allowance |
(4,282 | ) | (3,240 | ) | ||||
|
|
|
|
|||||
Net deferred tax liability |
$ | (1,174 | ) | $ | — | |||
|
|
|
|
9. |
PREFERRED STOCK |
10. |
COMMON STOCK |
11. |
STOCK COMPENSATION PLAN |
Outstanding Stock Options |
||||
Outstanding at January 1, 2019 |
54,470 | |||
Granted |
— | |||
Exercised |
— | |||
Forfeited / Terminated |
— | |||
|
|
|||
Outstanding at December 31, 2019 |
54,470 | |||
Granted |
191,590 | |||
Exercised |
— | |||
Forfeited / Terminated |
(25,000 | ) | ||
|
|
|||
Outstanding at December 31, 2020 |
221,060 | |||
|
|
|||
Granted |
— | |||
Exercised |
— | |||
Forfeited / Terminated |
(25,000 | ) | ||
|
|
|||
Outstanding at December 31, 2021 |
196,060 | |||
|
|
Expected dividend yield |
0 | % | ||
Expected volatility |
47 | % | ||
Expected term (years) |
6 | |||
Risk-free interest rate |
1.35 | % |
12. |
RETIREMENT PLAN |
13. |
ACQUISITION |
As of December 2, 2021 |
||||
Acquired assets |
||||
Inventory |
$ | 2,408 | ||
Other current assets |
741 | |||
Property and equipment |
26 | |||
Internal-use software and website |
348 | |||
Intangible assets |
||||
Customer relationships |
2,538 | |||
Developed technology |
748 | |||
Trade name |
438 | |||
Security Deposits |
19 | |||
|
|
|||
Total identifiable assets |
$ |
7,266 |
||
Liabilities assumed |
||||
Accounts payable |
$ | 151 | ||
Deferred revenue |
3,224 | |||
|
|
|||
Total liabilities |
$ |
3,375 |
December 3-30, 2021 |
||||
Net revenue |
$ | 4,317 | ||
Gross margin |
$ | 3,156 | ||
Net income |
$ | 560 |
14. |
RELATED PARTY TRANSACTIONS |
15. |
REVENUE |
For Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Commerce-as-a-Service Revenue |
$ | 19,830 | $ | 20,227 | $ | 22,460 | ||||||
Product Sales Revenue |
51,346 | — | — | |||||||||
Marketing Revenue |
19,249 | 14,142 | 10,177 | |||||||||
Shipping Revenue |
7,030 | 5,363 | 3,535 | |||||||||
Other Revenue |
3,893 | 5,785 | 4,782 | |||||||||
|
|
|
|
|
|
|||||||
Total Revenue |
$ | 101,348 | $ | 45,517 | 40,954 | |||||||
|
|
|
|
|
|
16. |
SEGMENT REPORTING |
17. |
EARNINGS PER SHARE |
Twelve Months ended December 31, |
||||||||||||
(In thousands, except share and per share amounts) |
2021 |
2020 |
2019 |
|||||||||
Numerator: Basic EPS |
||||||||||||
Net loss |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
Less: Undistributed earnings attributable to participating securities |
— | — | — | |||||||||
|
|
|
|
|
|
|||||||
Net loss attributable to common stockholders-basic |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
|
|
|
|
|
|
|||||||
Denominator: Basic EPS |
||||||||||||
Weighted average shares of common stock outstanding-basic |
9,129,358 | 9,129,358 | 9,130,726 | |||||||||
|
|
|
|
|
|
|||||||
Net loss per share attributable to common stock-basic |
$ | (0.01 | ) | $ | (0.12 | ) | $ | — | ||||
|
|
|
|
|
|
|||||||
Numerator: Diluted EPS |
||||||||||||
Net loss attributable to common stockholders-basic |
$ | (65 | ) | $ | (1,140 | ) | $ | — | ||||
Denominator: Diluted EPS |
||||||||||||
Weighted average shares of common stock outstanding-basic |
9,129,358 | 9,129,358 | 9,130,726 | |||||||||
Dilutive potential shares of common stock: |
||||||||||||
Options to purchase shares of common stock |
— | — | — | |||||||||
Warrants to purchase shares of common stock |
— | — | — | |||||||||
|
|
|
|
|
|
|||||||
Weighted average shares of common stock outstanding-diluted |
9,129,358 | 9,129,358 | 9,130,276 | |||||||||
Net loss per share attributable to common stock-diluted |
$ | (0.01 | ) | $ | (0.12 | ) | $ | — | ||||
|
|
|
|
|
|
Twelve Months ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Series A convertible, redeemable preferred shares |
2,042,483 | 2,042,483 | 2,042,483 | |||||||||
Series B convertible, redeemable preferred shares |
1,459,462 | 1,459,562 | 1,459,562 | |||||||||
Stock-based compensation awards |
199,211 | 202,212 | 54,470 | |||||||||
Outstanding warrants |
112,977 | 100,000 | 100,000 |
18. |
COMMITMENTS AND CONTINGENCIES |
As of December 31, 2021 |
||||
2022 |
$ | 3,017 | ||
2023 |
1,272 | |||
2024 |
873 | |||
2025 |
900 | |||
2026 |
927 | |||
Thereafter |
1,853 | |||
|
|
|||
Total minimum lease payments |
$ | 8,842 | ||
|
|
19. |
SUBSEQUENT EVENTS |
March 31, 2022 |
December 31, 2021 |
|||||||
(Unaudited) |
||||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash |
$ | 1,345 | $ | 1,071 | ||||
Accounts receivable, net |
2,340 | 1,977 | ||||||
Related party receivables |
5,881 | 5,356 | ||||||
Inventory |
18,725 | 22,777 | ||||||
Prepaid expenses and other current assets |
5,224 | 2,915 | ||||||
Total current assets |
33,515 | 34,096 | ||||||
Restricted cash |
1,500 | 3,500 | ||||||
Property and equipment, net |
1,747 | 1,789 | ||||||
Intangible assets, net |
1,054 | 1,112 | ||||||
Investment in unconsolidated affiliates |
12,537 | 13,570 | ||||||
Other non-current asset |
664 | 664 | ||||||
|
|
|
|
|||||
Total assets |
$ | 51,017 | $ | 54,731 | ||||
|
|
|
|
|||||
LIABILITIES, CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 18,603 | $ | 16,098 | ||||
Due to clients |
4,874 | 5,151 | ||||||
Related party payables |
4,015 | — | ||||||
Accrued expenses and other liabilities |
9,585 | 14,018 | ||||||
Total current liabilities |
37,077 | 35,267 | ||||||
Line of credit |
4,000 | 348 | ||||||
Long-term note payable, net |
19,799 | 19,249 | ||||||
Deferred tax liabilities |
1,332 | 1,174 | ||||||
Other long-term liabilities |
734 | 734 | ||||||
|
|
|
|
|||||
Total liabilities |
62,942 | 56,772 | ||||||
|
|
|
|
|||||
Commitments and contingencies (Note 14) |
||||||||
CONVERTIBLE REDEEMABLE PREFERRED STOCK |
||||||||
Series A convertible, redeemable preferred stock, $0.0001 par value, 2,042,483 shares authorized, issued and outstanding, as of March 31, 2022 and December 31, 2021 |
4,687 | 4,687 | ||||||
Series B convertible, redeemable preferred stock, $0.0001 par value, 1,600,000 shares authorized as of March 31, 2022 and December 31, 2021 respectively; 1,459,462 shares issued and outstanding |
6,502 | 6,502 | ||||||
STOCKHOLDERS’ DEFICIT |
||||||||
Common stock, $0.0001 par value, 14,000,000 shares authorized; 9,129,358 shares issued and outstanding as of March 31, 2022 and December 31, 2021 |
1 | 1 | ||||||
Additional paid-in capital |
4,419 | 4,361 | ||||||
Treasury stock |
(1,330 | ) | (1,330 | ) | ||||
Accumulated deficit |
(26,204 | ) | (16,262 | ) | ||||
Total stockholders’ deficit |
(23,114 | ) | (13,230 | ) | ||||
|
|
|
|
|||||
Total liabilities, convertible redeemable preferred stock and stockholders’ deficit |
$ | 51,017 | $ | 54,731 | ||||
|
|
|
|
Three Months Ended March 31, |
||||||||
2022 |
2021 |
|||||||
Net service revenue |
$ | 8,533 | $ | 11,930 | ||||
Net product revenue |
12,922 | — | ||||||
Net revenue from related parties |
3,744 | — | ||||||
|
|
|
|
|||||
Total net revenue |
25,199 | 11,930 | ||||||
Operating costs and expenses: |
||||||||
Cost of services |
5,435 | 5,666 | ||||||
Cost of product revenue |
10,251 | — | ||||||
Sales and marketing |
566 | 305 | ||||||
Research and development |
1,577 | 1,097 | ||||||
General and administrative |
17,222 | 6,423 | ||||||
Depreciation and amortization |
201 | 108 | ||||||
|
|
|
|
|||||
Total operating costs and expenses |
35,252 | 13,599 | ||||||
|
|
|
|
|||||
Operating loss |
(10,053 | ) | (1,669 | ) | ||||
Interest expense |
(652 | ) | (49 | ) | ||||
Change in fair value of unconsolidated affiliates |
(1,033 | ) | — | |||||
|
|
|
|
|||||
Other income |
1,954 | 229 | ||||||
|
|
|
|
|||||
Loss before income taxes |
(9,784 | ) | (1,489 | ) | ||||
Provision for income taxes |
158 | 5 | ||||||
Net loss |
$ | (9,942 | ) | $ | (1,494 | ) | ||
Net loss per common share – basic and diluted |
$ | (1.09 | ) | $ | (0.16 | ) | ||
Weighted average shares outstanding – basic and diluted |
9,129,358 | 9,129,358 | ||||||
|
|
|
|
Convertible Redeemable Preferred Stock |
Common Stock |
Additional Paid-in Capital |
Treasury Stock |
Accumulated Deficit |
Total Stockholders’ Deficit |
|||||||||||||||||||||||||||||||||||
Series A |
Series B |
|||||||||||||||||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
Shares |
Amount |
|||||||||||||||||||||||||||||||||||
Balance, December 31, 2020 |
2,042,483 | $ | 4,687 | 1,459,462 | $ | 6,502 | 9,129,358 | $ | 1 | $ | 4,308 | $ | (1,330 | ) | $ | (16,197 | ) | $ | (13,218 | ) | ||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | (1,494 | ) | (1,494 | ) | ||||||||||||||||||||||||||||
Balance, March 31, 2021 |
2,042,483 | 4,687 | 1,459,462 | $ | 6,502 | 9,129,358 | $ | 1 | $ | 4,308 | $ | (1,330 | ) | $ | (17,691 | ) | $ | (14,712 | ) | |||||||||||||||||||||
Balance, December 31, 2020 |
2,042,483 | 4,687 | 1,459,462 | 6,502 | 9,129,358 | 1 | 4,361 | (1,330 | ) | (16,262 | ) | (13,230 | ) | |||||||||||||||||||||||||||
Stock-based compensation |
— | — | — | — | — | — | 58 | — | — | 58 | ||||||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | — | — | — | (9,942 | ) | (9,942 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance, March 31, 2022 |
2,042,483 | $ | 4,687 | 1,459,462 | $ | 6,502 | 9,129,358 | $ | 1 | $ | 4,419 | $ | (1,330 | ) | $ | (26,204 | ) | $ | (23,114 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
||||||||
2022 |
2021 |
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
Net loss |
$ | (9,942 | ) | $ | (1,494 | ) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
201 | 108 | ||||||
Amortization of debt issuance costs |
102 | — | ||||||
Amortization of contract acquisition costs |
— | 167 | ||||||
Stock-based compensation |
58 | — | ||||||
Deferred income taxes |
158 | — | ||||||
Fair value adjustment on joint ventures |
1,033 | — | ||||||
Settlement of deferred revenue |
(1,611 | ) | — | |||||
Changes in operating assets and liabilities: |
||||||||
Accounts receivable |
(363 | ) | 1,405 | |||||
Related party receivables |
(525 | ) | — | |||||
Inventory |
4,052 | — | ||||||
Prepaid expenses and other current assets |
(2,309 | ) | (126 | ) | ||||
Accounts payable |
2,505 | (1,333 | ) | |||||
Due to clients |
(277 | ) | (5,941 | ) | ||||
Related party payables |
4,015 | — | ||||||
Accrued expenses and other liabilities |
(2,374 | ) | (684 | ) | ||||
|
|
|
|
|||||
Net cash used in operating activities |
(5,277 | ) | (7,898 | ) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
Purchases of property and equipment |
(101 | ) | (202 | ) | ||||
|
|
|
|
|||||
Net cash used in investing activities |
(101 | ) | (202 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
Proceeds from line of credit |
47,455 | 38,071 | ||||||
Repayments of line of credit |
(43,803 | ) | (33,071 | ) | ||||
|
|
|
|
|||||
Net cash provided by financing activities |
3,652 | 5,000 | ||||||
|
|
|
|
|||||
NET (DECREASE) INCREASE IN CASH AND RESTRICTED CASH |
(1,726 | ) | 3,100 | |||||
Beginning of period |
4,571 | 16,168 | ||||||
|
|
|
|
|||||
End of period |
$ | 2,845 | $ | 13,068 | ||||
|
|
|
|
|||||
SUPPLEMENTAL CASH FLOW INFORMATION |
||||||||
Cash paid for the interest |
$ | 652 | $ | 49 | ||||
SCHEDULE OF CASH AND RESTRICTED CASH |
||||||||
Cash |
$ | 1,345 | $ | 13,068 | ||||
Restricted cash |
1,500 | — | ||||||
|
|
|
|
|||||
Total cash and restricted cash |
$ | 2,845 | $ | 13,068 |
1. |
OVERVIEW |
2. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
• | Identification of a contract with a customer, |
• | Identification of the performance obligations in the contract, |
• | Determination of the transaction price, |
• | Allocation of the transaction price to the performance obligations in the contract, and |
• | Recognition of revenue when or as the performance obligations are satisfied. |
3. |
PROPERTY AND EQUIPMENT |
March 31, 2022 |
December 31, 2021 |
|||||||
Furniture and equipment |
$ | 2,262 | $ | 2,160 | ||||
Leasehold Improvements |
536 | 536 | ||||||
Property, plant, and equipment, gross |
(2,798 | ) | 2,696 | |||||
Less accumulated depreciation |
(1,051 | ) | (907 | ) | ||||
Property and equipment, net |
$ | 1,747 | $ | 1,789 | ||||
4. |
INTANGIBLE ASSETS |
March 31, 2022 |
December 31, 2021 |
|||||||
Contract acquisition cost |
$ | 2,000 | $ | 2,000 | ||||
Software |
1,174 | 1,174 | ||||||
3,174 | 3,174 | |||||||
Less: Accumulated amortization |
(2,120 | ) | (2,062 | ) | ||||
Intangible assets-net |
$ | 1,054 | $ | 1,112 | ||||
5. |
INVESTMENT IN UNCONSOLIDATED AFFILIATES |
Modcloth |
IPCO |
|||||||
Net revenue |
$ | 5,400 | $ | 6,507 | ||||
Gross margin |
$ | 2,380 | $ | 1,356 | ||||
Net loss |
$ | (1,155 | ) | $ | (561 | ) | ||
Current assets |
$ | 2,925 | $ | 5,207 | ||||
Long term assets |
$ | 6,319 | $ | 5,973 | ||||
Current liabilities |
$ | 8,250 | $ | 7,807 | ||||
Long term liabilities |
$ | 5,098 | $ | — |
• | Discounted Cash Flow |
• | Guideline Public Company Method |
• | Guideline Transaction Method |
Modcloth |
IPCO |
|||||||
Balance as of December 31, 2021 |
$ | 6,437 | $ | 7,133 | ||||
Change in fair value |
(919 | ) | (114 | ) | ||||
Balance as of March 31, 2022 |
$ | 5,518 | $ | 7,019 | ||||
6. |
LONG-TERM DEBT |
March 31, 2022 |
December 31, 2021 |
|||||||
First Tranche Notes |
$ | 10,000 | $ | 10,000 | ||||
First Tranche Notes Exit Fee |
600 | 600 | ||||||
Second Tranche Notes |
5,000 | 5,000 | ||||||
Second Tranche Notes Exit Fee |
300 | 300 | ||||||
Third Tranche Notes |
5,000 | 5,000 | ||||||
Third Tranche Notes Exit Fee |
50 | 50 | ||||||
20,950 | 20,950 | |||||||
Less: Unamortized Exit Fee payment |
(830 | ) | (884 | ) | ||||
Less: Unamortized warrant discount |
(639 | ) | (678 | ) | ||||
Less: Unamortized debt issuance costs |
(130 | ) | (139 | ) | ||||
Add: Unamortized costs - short-term in accrued expense and other liabilities |
448 | — | ||||||
$ | 19,799 | $ | 19,240 | |||||
2022 (remaining) |
$ | — | ||
2023 |
6022 | |||
2024 |
5,000 | |||
2025 |
5,000 | |||
2026 |
4,928 | |||
Total |
$ | 20,950 | ||
7. |
WARRANTS |
March 31, 2022 |
December 31, 2021 |
|||||||
Common Stock Fair Value Share |
$ | 16.81 | $ | 16.81 | ||||
Exercise Price Per Share |
$ | 0.01 | $ | 0.01 | ||||
Volatility |
75.7 | % | 75.7 | % | ||||
Risk Free rate |
0.53 | % | 0.53 | % | ||||
Expected Dividend Rate |
0.0 | % | 0.0 | % |
8. |
INCOME TAXES |
9. |
ACQUISITION |
As of December 2, 2021 |
||||
Acquired assets |
||||
Inventory |
$ | 2,408 | ||
Other current assets |
741 | |||
Property and equipment |
26 | |||
Internal-use software and website |
348 | |||
Intangible assets |
||||
Customer relationships |
2,538 | |||
Developed technology |
748 | |||
Trade name |
438 | |||
Security Deposits |
19 | |||
Total identifiable assets |
$ |
7,266 |
||
Liabilities assumed |
||||
Accounts payable |
$ | 151 | ||
Deferred revenue |
3,224 | |||
Total liabilities |
$ |
3,375 |
December 3-30, 2021 |
||||
Net revenue |
$ | 4,317 | ||
Gross margin |
$ | 3,156 | ||
Net income |
$ | 560 |
10. |
RELATED PARTY TRANSACTIONS |
11. |
REVENUE |
Three Months ended March 31, |
||||||||
2022 |
2021 |
|||||||
Commerce-as-a-Service |
$ | 5,201 | $ | 4,603 | ||||
Product sales revenue |
12,922 | — | ||||||
Marketing revenue |
3,670 | 4,282 | ||||||
Shipping revenue |
1,881 | 1,432 | ||||||
Other revenue |
1,525 | 1,613 | ||||||
Total revenue |
$ | 25,199 | $ | 11,930 | ||||
12. |
SEGMENT REPORTING |
13. |
EARNINGS PER SHARE |
Three Months ended March 31, |
||||||||
(In thousands, except share and per share amounts) |
2022 |
2021 |
||||||
Numerator: Basic and Diluted EPS |
||||||||
Net loss |
$ | (9,942 | ) | $ | (1,494 | ) | ||
Less: Undistributed earnings attributable to participating securities |
— | — | ||||||
Net loss attributable to common stockholder basic and diluted |
$ | (9,942 | ) | $ | (1,494 | ) | ||
Denominator: Basic and Diluted EPS |
||||||||
Weighted average shares of common stock outstanding-basic and diluted |
9,129,358 | 9,129,358 | ||||||
Net loss per share attributable to common stock-basic and diluted |
$ | (1.09 | ) | $ | (0.16 | ) | ||
Three Months ended March 31, |
||||||||
2022 |
2021 |
|||||||
Series A convertible, redeemable preferred shares |
2,042,483 | 2,042,483 | ||||||
Series B convertible, redeemable preferred shares |
1,459,462 | 1,459,562 | ||||||
Stock-based compensation awards |
279,553 | 51,494 | ||||||
Outstanding warrants |
145,860 | 124,658 |
14. |
COMMITMENTS AND CONTINGENCIES |
As of March 31, 2022 |
||||
2022 (remaining payments) |
$ | 2,250 | ||
2023 |
1,272 | |||
2024 |
873 | |||
2025 |
900 | |||
2026 |
927 | |||
Thereafter |
1,853 | |||
Total minimum lease payments |
$ | 8,075 | ||
15. |
RECENT EVENTS |
16. |
SUBSEQUENT EVENTS |
Page | ||||||||
ARTICLE I THE MERGER |
A-2 | |||||||
Section 1.1 |
The Merger |
A-2 | ||||||
Section 1.2 |
Effective Time |
A-3 | ||||||
Section 1.3 |
Effect of the Merger |
A-3 | ||||||
Section 1.4 |
Governing Documents |
A-3 | ||||||
Section 1.5 |
Directors and Officers |
A-3 | ||||||
ARTICLE II MERGER CONSIDERATION; CONVERSION OF SECURITIES |
A-3 | |||||||
Section 2.1 |
Calculation of the Merger Consideration |
A-3 | ||||||
Section 2.2 |
Payment of the Merger Consideration |
A-3 | ||||||
Section 2.3 |
Conversion of Company Securities |
A-4 | ||||||
Section 2.4 |
Treatment of Company Options |
A-4 | ||||||
Section 2.5 |
Exchange Procedures for Company Stockholders |
A-5 | ||||||
Section 2.6 |
Consideration Election Procedures |
A-6 | ||||||
Section 2.7 |
Withholding Rights |
A-7 | ||||||
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE GROUP COMPANIES |
A-8 | |||||||
Section 3.1 |
Organization |
A-8 | ||||||
Section 3.2 |
Authorization |
A-8 | ||||||
Section 3.3 |
Capitalization |
A-8 | ||||||
Section 3.4 |
Company Subsidiaries |
A-9 | ||||||
Section 3.5 |
Consents and Approvals; No Violations |
A-9 | ||||||
Section 3.6 |
Financial Statements |
A-10 | ||||||
Section 3.7 |
No Undisclosed Liabilities |
A-10 | ||||||
Section 3.8 |
Absence of Certain Changes |
A-11 | ||||||
Section 3.9 |
Real Estate |
A-11 | ||||||
Section 3.10 |
Intellectual Property |
A-11 | ||||||
Section 3.11 |
Litigation |
A-13 | ||||||
Section 3.12 |
Company Material Contracts |
A-14 | ||||||
Section 3.13 |
Tax Returns; Taxes |
A-16 | ||||||
Section 3.14 |
Environmental Matters |
A-17 | ||||||
Section 3.15 |
Licenses and Permits |
A-18 | ||||||
Section 3.16 |
Company Benefit Plans |
A-18 | ||||||
Section 3.17 |
Labor Relationships |
A-19 | ||||||
Section 3.18 |
International Trade & Anti-Corruption Matters |
A-20 | ||||||
Section 3.19 |
Certain Fees |
A-21 | ||||||
Section 3.20 |
Insurance Policies |
A-21 | ||||||
Section 3.21 |
Affiliate Transactions |
A-21 | ||||||
Section 3.22 |
Information Supplied |
A-21 | ||||||
Section 3.23 |
Customers, and Suppliers |
A-21 | ||||||
Section 3.24 |
Compliance with Laws |
A-22 | ||||||
Section 3.25 |
PPP Loan |
A-22 | ||||||
Section 3.26 |
No Additional Representations or Warranties |
A-22 | ||||||
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PARENT PARTIES |
A-22 | |||||||
Section 4.1 |
Organization |
A-23 | ||||||
Section 4.2 |
Authorization |
A-23 | ||||||
Section 4.3 |
Capitalization |
A-23 | ||||||
Section 4.4 |
Consents and Approvals; No Violations |
A-24 | ||||||
Section 4.5 |
Financial Statements |
A-24 | ||||||
Section 4.6 |
Reserved |
A-25 |
Page | ||||||||
Section 4.7 |
Business Activities; No Undisclosed Liabilities |
A-25 | ||||||
Section 4.8 |
Absence of Certain Changes |
A-25 | ||||||
Section 4.9 |
Litigation |
A-25 | ||||||
Section 4.10 |
Parent Material Contracts |
A-26 | ||||||
Section 4.11 |
Tax Returns; Taxes |
A-26 | ||||||
Section 4.12 |
Compliance with Laws |
A-27 | ||||||
Section 4.13 |
Certain Fees |
A-27 | ||||||
Section 4.14 |
Organization of Merger Sub |
A-27 | ||||||
Section 4.15 |
SEC Filings; NASDAQ; Investment Company Act |
A-27 | ||||||
Section 4.16 |
Information Supplied |
A-28 | ||||||
Section 4.17 |
Board Approval; Stockholder Vote |
A-29 | ||||||
Section 4.18 |
Trust Account |
A-29 | ||||||
Section 4.19 |
Affiliate Transactions |
A-29 | ||||||
Section 4.20 |
Independent Investigation; No Reliance |
A-30 | ||||||
Section 4.21 |
Employees and Employee Benefits |
A-30 | ||||||
Section 4.22 |
Valid Issuance |
A-30 | ||||||
Section 4.23 |
Takeover Statutes and Charter Provisions |
A-30 | ||||||
Section 4.24 |
No Additional Representations or Warranties |
A-31 | ||||||
ARTICLE V COVENANTS |
A-31 | |||||||
Section 5.1 |
Interim Operations of the Company |
A-31 | ||||||
Section 5.2 |
Interim Operations of the Parent Parties |
A-33 | ||||||
Section 5.3 |
Trust Account |
A-34 | ||||||
Section 5.4 |
Commercially Reasonable Efforts; Consents |
A-34 | ||||||
Section 5.5 |
Public Announcements |
A-35 | ||||||
Section 5.6 |
Access to Information. Confidentiality |
A-36 | ||||||
Section 5.7 |
Tax Matters |
A-36 | ||||||
Section 5.8 |
Directors’ and Officers’ Indemnification |
A-37 | ||||||
Section 5.9 |
Proxy Statement |
A-38 | ||||||
Section 5.10 |
Parent Common Stockholder Meeting |
A-40 | ||||||
Section 5.11 |
Section 16 of the Exchange Act |
A-41 | ||||||
Section 5.12 |
Nonsolicitation |
A-41 | ||||||
Section 5.13 |
Termination of Agreements |
A-41 | ||||||
Section 5.14 |
Merger Written Consent |
A-41 | ||||||
Section 5.15 |
Elections and Other Matters |
A-42 | ||||||
Section 5.16 |
PCAOB Financial Statements |
A-42 | ||||||
Section 5.17 |
Omnibus Incentive Plan |
A-42 | ||||||
Section 5.18 |
Registration Rights Agreement |
A-42 | ||||||
Section 5.19 |
Governing Documents |
A-42 | ||||||
Section 5.20 |
Intellectual Property Assignment |
A-43 | ||||||
ARTICLE VI CONDITIONS TO OBLIGATIONS OF THE PARTIES |
A-43 | |||||||
Section 6.1 |
Conditions to Each Party’s Obligations |
A-43 | ||||||
Section 6.2 |
Conditions to Obligations of the Company |
A-43 | ||||||
Section 6.3 |
Conditions to Obligations of the Parent Parties |
A-44 | ||||||
Section 6.4 |
Frustration of Closing Conditions |
A-44 | ||||||
ARTICLE VII CLOSING |
A-45 | |||||||
Section 7.1 |
Closing |
A-45 | ||||||
Section 7.2 |
Deliveries by the Company |
A-45 | ||||||
Section 7.3 |
Deliveries by Parent |
A-45 |
Page | ||||||||
ARTICLE VIII TERMINATION |
A-45 | |||||||
Section 8.1 |
Termination |
A-45 | ||||||
Section 8.2 |
Procedure and Effect of Termination |
A-46 | ||||||
ARTICLE IX MISCELLANEOUS |
A-46 | |||||||
Section 9.1 |
Release |
A-46 | ||||||
Section 9.2 |
Fees and Expenses |
A-47 | ||||||
Section 9.3 |
Notices |
A-47 | ||||||
Section 9.4 |
Severability |
A-48 | ||||||
Section 9.5 |
Binding Effect; Assignment |
A-48 | ||||||
Section 9.6 |
No Third Party Beneficiaries |
A-48 | ||||||
Section 9.7 |
Section Headings |
A-48 | ||||||
Section 9.8 |
Consent to Jurisdiction, Etc |
A-48 | ||||||
Section 9.9 |
Entire Agreement |
A-49 | ||||||
Section 9.10 |
Governing Law |
A-49 | ||||||
Section 9.11 |
Specific Performance |
A-49 | ||||||
Section 9.12 |
Counterparts |
A-50 | ||||||
Section 9.13 |
Amendment; Modification |
A-50 | ||||||
Section 9.14 |
Time of Essence |
A-50 | ||||||
Section 9.15 |
Schedules |
A-50 | ||||||
Section 9.16 |
No Recourse |
A-50 | ||||||
Section 9.17 |
Construction |
A-51 | ||||||
Section 9.18 |
Non-Survival |
A-51 | ||||||
Section 9.19 |
Trust Account Waiver |
A-51 |
Exhibit A | Definitions | |
Exhibit B | Sponsor Support Agreement | |
Exhibit C | Form of Company Support Agreement | |
Exhibit D | Form of Amended and Restated Certificate of Incorporation of Parent | |
Exhibit E | Form of Amended and Restated Bylaws of Parent | |
Exhibit F | Form of Omnibus Incentive Plan | |
Exhibit G | Form of Registration Rights Agreement |
PARENT : | ||
SOFTWARE ACQUISITION GROUP INC. III | ||
By: | /s/ Jonathan Huberman | |
Name: | Jonathan Huberman | |
Title: | Chairman, CEO & CFO |
MERGER SUB : | ||
NUEVO MERGER SUB, INC. | ||
By: | /s/ Jonathan Huberman | |
Name: | Jonathan Huberman | |
Title: | Chairman, CEO & CFO |
COMPANY : | ||
BRANDED ONLINE, INC. dba Nogin | ||
By: | /s/ Jan Nugent | |
Name: | Jan Nugent | |
Title: | Chief Executive Officer |
Term |
Section | |
Accounts |
3.10 | |
Acquisition Proposal |
5.12(b) | |
Agreement |
Preamble | |
A&R Bylaws |
Recitals | |
A&R Charter |
Recitals | |
Available Cash |
5.3 | |
Cash Electing Share |
2.3(a)(i) | |
Cash Electing Stockholder |
2.3(a)(i) | |
Cash Election |
2.3(a)(i) | |
Cash Merger Consideration |
2.3(a)(i) | |
Certificate of Merger |
1.2 | |
Change in Recommendation |
5.10 | |
Closing |
7.1 | |
Closing Date |
7.1 | |
Company |
Preamble | |
Company Adjournment Proposal |
5.11(a) | |
Company Closing Certificate |
6.3(c) | |
Company Intellectual Property |
3.10(c) | |
Company Letter of Transmittal |
2.5(a) | |
Company Material Contracts |
3.12 | |
Company Preferred Stockholder Approval |
3.2 | |
Company Stockholder Approval |
3.2 | |
Consideration |
2.3(a) | |
DGCL |
Recitals |
Term |
Section | |
Effective Time |
1.2 | |
Election Date |
2.6(e) | |
Excess Cash Stockholders |
2.6(c) | |
Exchange Agent Fund |
2.2 | |
Financial Statements |
3.6 | |
Form of Election |
2.6(d) | |
Indemnified Persons |
5.8(a) | |
Interim Balance Sheet |
3.6 | |
Interim Financial Statements |
3.6 | |
IRS |
3.16(b)(iv) | |
Lease |
3.9(c) | |
Leased Real Property |
3.9(b) | |
Material Customer |
3.23 | |
Material Supplier |
3.23 | |
Merger |
Recitals | |
Merger Consideration |
2.1 | |
Merger Sub |
Preamble | |
Merger Written Consent |
5.14 | |
Nonparty Affiliates |
9.16 | |
Offer |
Recitals | |
Offering Shares |
5.9(a) | |
Omnibus Incentive Plan |
5.9(a) | |
Outside Date |
8.1(e) | |
Parent |
Preamble | |
Parent Board Recommendation |
5.10 | |
Parent Closing Certificate |
6.2(c) | |
Parent Common Stockholders Meeting |
5.10 | |
Parent Disclosure Schedule |
Article IV | |
Parent Fundamental Representations |
6.2(a) | |
Parent Option |
2.4 | |
Parent Parties |
Preamble | |
Parent Stockholder Approval |
4.2 | |
Parent Warrants |
4.3(c) | |
Parties |
Preamble | |
Party |
Preamble | |
PCAOB Financial Statements |
5.16 | |
Permitted Financing |
5.2(b) | |
Prospectus |
9.19 | |
Proxy Statement |
5.9(a) | |
Registration Rights Agreement |
5.18 | |
Released Parties |
9.1 | |
Releasors |
9.1 | |
Requisite Company Approvals |
3.2 | |
Schedules |
Article III | |
Section 16 |
5.11 | |
Social Media Terms |
3.10(a) | |
Surviving Company |
Recitals | |
Tail Premium |
5.8(b) |
Term |
Section | |
Trade Control Laws |
3.18(a) | |
Transaction Proposals |
5.9(a) | |
Trust Account |
4.18(a) | |
Trust Agreement |
4.18(a) | |
Trust Amount |
4.18(a) | |
Trustee |
4.18(a) | |
WARN Act |
5.1(b)(xii) | |
Warrant Settlement |
Recitals |
SOFTWARE ACQUISITION GROUP INC. III | ||
By: | /s/ Jonathan Huberman | |
Name: | Jonathan Huberman | |
Title: | Chairman, CEO & CFO |
NUEVO MERGER SUB, INC. | ||
By: | /s/ Jonathan Huberman | |
Name: | Jonathan Huberman | |
Title: | Chairman, CEO & CFO |
BRANDED ONLINE, INC. DBA NOGIN | ||
By: | /s/ Jan Nugent | |
Name: | Jan Nugent | |
Title: | Chief Executive Officer |
SOFTWARE ACQUISITION GROUP INC. III | ||||
By: | | |||
Name: | ||||
Title: |
A. | COMMON STOCK. |
a. | Except as otherwise provided herein (including any Certificate of Designation) or otherwise required by law, the holders of the shares of Common Stock shall exclusively possess all voting power with respect to the Corporation. |
b. | Except as otherwise provided herein or expressly required by law, each holder of Common Stock, as such, shall be entitled to vote on each matter submitted to a vote of stockholders and shall be entitled to one (1) vote for each share of Common Stock held of record by such holder as of the record date for determining stockholders entitled to vote on such matter. |
c. | Except as otherwise provided herein (including any Certificate of Designation) or otherwise required by law, at any annual or special meeting of the stockholders of the Corporation, holders of the Common Stock shall have the exclusive right to vote for the election of directors and on all other matters properly submitted to a vote of the stockholders. |
d. | Except as otherwise required by law, holders of Common Stock, as such, shall not be entitled to vote on any amendment to this Second Amended and Restated Certificate (including any Certificate of Designation (as defined below)) that relates solely to the rights, powers, preferences (or the qualifications, limitations or restrictions thereof) or other terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to this Second Amended and Restated Certificate (including any Certificate of Designation) or pursuant to the DGCL. |
Page |
||||||
Article I - Corporate Offices |
C-1 |
|||||
1.1 |
Registered Office |
C-1 |
||||
1.2 |
Other Offices |
C-1 |
||||
Article II - Meetings of Stockholders |
C-1 |
|||||
2.1 |
Place of Meetings |
C-1 |
||||
2.2 |
Annual Meeting |
C-1 |
||||
2.3 |
Special Meeting |
C-1 |
||||
2.4 |
Notice of Business to be Brought before a Meeting. |
C-1 |
||||
2.5 |
Notice of Nominations for Election to the Board. |
C-4 |
||||
2.6 |
Notice of Stockholders’ Meetings |
C-7 |
||||
2.7 |
Quorum |
C-8 |
||||
2.8 |
Adjourned Meeting; Notice |
C-8 |
||||
2.9 |
Conduct of Business |
C-8 |
||||
2.10 |
Voting |
C-9 |
||||
2.11 |
Record Date for Stockholder Meetings and Other Purposes |
C-9 |
||||
2.12 |
Proxies |
C-9 |
||||
2.13 |
List of Stockholders Entitled to Vote |
C-10 |
||||
2.14 |
Inspectors of Election |
C-10 |
||||
2.15 |
Delivery to the Corporation. |
C-11 |
||||
Article III - Directors |
C-11 |
|||||
3.1 |
Powers |
C-11 |
||||
3.2 |
Number of Directors |
C-11 |
||||
3.3 |
Election, Qualification and Term of Office of Directors |
C-11 |
||||
3.4 |
Resignation and Vacancies |
C-11 |
||||
3.5 |
Place of Meetings; Meetings by Telephone |
C-11 |
||||
3.6 |
Regular Meetings |
C-12 |
||||
3.7 |
Special Meetings; Notice |
C-12 |
||||
3.8 |
Quorum |
C-12 |
||||
3.9 |
Board Action without a Meeting |
C-12 |
||||
3.10 |
Fees and Compensation of Directors |
C-13 |
||||
Article IV - Committees |
C-13 |
|||||
4.1 |
Committees of Directors |
C-13 |
||||
4.2 |
Committee Minutes |
C-13 |
||||
4.3 |
Meetings and Actions of Committees |
C-13 |
||||
4.4 |
Subcommittees. |
C-14 |
||||
Article V - Officers |
C-14 |
|||||
5.1 |
Officers |
C-14 |
||||
5.2 |
Appointment of Officers |
C-14 |
||||
5.3 |
Subordinate Officers |
C-14 |
||||
5.4 |
Removal and Resignation of Officers |
C-14 |
||||
5.5 |
Vacancies in Offices |
C-15 |
||||
5.6 |
Representation of Shares of Other Corporations |
C-15 |
||||
5.7 |
Authority and Duties of Officers |
C-15 |
||||
5.8 |
Compensation. |
C-15 |
||||
Article VI - Records |
C-15 |
|||||
Article VII - General Matters |
C-15 |
|||||
7.1 |
Execution of Corporate Contracts and Instruments |
C-15 |
||||
7.2 |
Stock Certificates |
C-16 |
||||
7.3 |
Special Designation of Certificates. |
C-16 |
Page |
||||||
7.4 |
Lost Certificates |
C-16 |
||||
7.5 |
Shares Without Certificates |
C-16 |
||||
7.6 |
Construction; Definitions |
C-17 |
||||
7.7 |
Dividends |
C-17 |
||||
7.8 |
Fiscal Year |
C-17 |
||||
7.9 |
Seal |
C-17 |
||||
7.10 |
Transfer of Stock |
C-17 |
||||
7.11 |
Stock Transfer Agreements |
C-17 |
||||
7.12 |
Registered Stockholders |
C-17 |
||||
7.13 |
Lock-Up |
C-18 |
||||
7.14 |
Waiver of Notice |
C-19 |
||||
Article VIII - Notice |
C-19 |
|||||
8.1 |
Delivery of Notice; Notice by Electronic Transmission |
C-19 |
||||
Article IX - Indemnification |
C-20 |
|||||
9.1 |
Indemnification of Directors and Officers |
C-20 |
||||
9.2 |
Indemnification of Others |
C-21 |
||||
9.3 |
Prepayment of Expenses |
C-21 |
||||
9.4 |
Determination; Claim |
C-21 |
||||
9.5 |
Non-Exclusivity of Rights |
C-21 |
||||
9.6 |
Insurance |
C-21 |
||||
9.7 |
Other Indemnification |
C-22 |
||||
9.8 |
Continuation of Indemnification |
C-22 |
||||
9.9 |
Amendment or Repeal; Interpretation |
C-22 |
||||
Article X - Amendments |
C-22 |
|||||
Article XI - Forum Selection |
C-23 |
|||||
Article XII - Definitions |
C-23 |
(i) | if by facsimile telecommunication, when directed to a number at which the stockholder has consented to receive notice; |
(ii) | if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of (A) such posting and (B) the giving of such separate notice; and |
(iii) | if by any other form of electronic transmission, when directed to the stockholder. |
[ ● ] |
[Secretary] |
SOFTWARE ACQUISITION HOLDINGS III, LLC | ||
By: | /s/ Jonathan Huberman | |
Name: | Jonathan Huberman | |
Title: | Managing Member |
Accepted and Agreed: | ||
SOFTWARE ACQUISITION GROUP INC. III | ||
By: | /s/ Jonathan Huberman | |
Name: | Jonathan Huberman | |
Title: | Chairman, CEO and CFO |
Accepted and Agreed: | ||
BRANDED ONLINE, INC. DBA NOGIN | ||
By: | /s/ Jan Nugent | |
Name: | Jan Nugent | |
Title: | Chief Executive Officer |
Attn: | Ryan J. Maierson |
John M. Greer |
Ryan J. Lynch |
Email: | Ryan.Maierson@lw.com |
John.Greer@lw.com |
Ryan.Lynch@lw.com |
Attn: | Jan Nugent; Geoffrey Van Haeren |
Email: | jnugent@nogin.com; gvanhaeren@nogin.com |
Attn: | Ryan J. Maierson |
John | M. Greer |
Ryan J. Lynch |
Email: | Ryan.Maierson@lw.com |
John.Greer@lw.com |
Ryan.Lynch@lw.com |
Attn: | Jonathan Huberman |
Email: | jon@softwareaqn.com |
Attn: | Damon R. Fisher |
Christian O. Nagler |
Brooks Antweil |
Email: | dfisher@kirkland.com |
cnagler@kirkland.com |
brooks.antweil@kirkland.com |
SOFTWARE ACQUISITION GROUP INC. III | ||
By: | /s/ Jonathan Huberman | |
Name: | Jonathan Huberman | |
Title: | Chairman, CEO & CFO |
BRANDED ONLINE, INC. DBA NOGIN | ||
By: | /s/ Jan Nugent | |
Name: | Jan Nugent | |
Title: | Chief Executive Officer |
JAN NUGENT | ||
/s/ Jan Nugent | ||
Name: | Jan Nugent | |
GEOFFREY VAN HAEREN | ||
/s/ Geoffrey Van Haeren | ||
Name: |
Geoffrey Van Haeren | |
STEPHEN CHOI | ||
/s/ Stephen Choi | ||
Name: | Stephen Choi | |
IRON GATE INVESTMENTS XVII, LLC | ||
/s/ Ryan Pollock | ||
Name: | Ryan Pollock | |
Title: | Managing Partner |
Page |
||||||
1. |
DEFINITIONS |
1 | ||||
2. |
REGISTERED OFFERINGS |
4 | ||||
3. |
PROCEDURES |
10 | ||||
4. |
INDEMNIFICATION |
13 | ||||
5. |
TERMINATION |
14 | ||||
6. |
MISCELLANEOUS |
15 |
Attention: | Ryan J. Maierson |
John M. Greer |
Ryan J. Lynch |
E-mail: |
ryan.maierson@lw.com |
john.greer@lw.com |
ryan.lynch@lw.com |
NOGIN, INC. | ||
By: | | |
Name: | Jan Nugent | |
Title: | Chief Executive Officer |
SOFTWARE ACQUISITION HOLDINGS III, LLC | ||
By: | | |
Name: | Jonathan Huberman | |
Title: | Chairman and CEO |
[HOLDER] | ||
By: | | |
Name: |
(i) | no suspension of the qualification of the offering or sale or trading of the Class A Common Shares (as defined below) on the Nasdaq Stock Market LLC (“ Nasdaq ”) or the New York Stock |
Exchange (“ NYSE ”) shall have been initiated or, to the Issuer’s knowledge, threatened in writing by Nasdaq, the NYSE or the U.S. Securities and Exchange Commission (the “SEC ” or the “Commission ”) and be continuing, and the Underlying Shares (as defined below) and the Underlying Warrant Shares (as defined below) shall have been approved for listing on Nasdaq or the NYSE, subject to official notice of issuance; |
(ii) | all conditions precedent to the closing of the Transactions set forth in the Transaction Agreement shall have been satisfied (as determined by the parties to the Transaction Agreement) or waived in writing (other than those conditions which, by their nature, are to be satisfied at the closing of the Transactions pursuant to the Transaction Agreement or by the Closing itself, but subject to their satisfaction or valid waiver at the closing of the Transactions), and the closing of the Transactions shall occur substantially concurrently with or immediately following the Closing; |
(iii) | no court or applicable governmental authority shall have enacted, issued, promulgated, enforced or entered any judgment, order, law, rule or regulation (whether temporary, preliminary or permanent) which is then in effect and has the effect of making the consummation of the transactions contemplated hereby illegal or otherwise restraining or prohibiting consummation of the transactions contemplated hereby, and no such court or applicable governmental authority shall have instituted a proceeding seeking to impose such a restraint or prohibition; |
(iv) | an indenture substantially in the form attached as Annex A hereto (the “Indenture ”), shall have been executed by the applicable parties thereto, including U.S. Bank Trust Company, National Association, as third-party trustee (in such capacity, the “Trustee ”) and collateral agent (in such capacity, the “Collateral Agent ”); and |
(v) | a warrant agreement substantially in the form attached as Annex B hereto (the “Subscriber Warrant Agreement ”), shall have been executed by the applicable parties thereto. |
(i) | all representations and warranties of such Subscriber contained in this Convertible Note Subscription Agreement shall be true and correct in all material respects (other than representations and warranties that are qualified as to materiality or Subscriber Material Adverse Effect (as defined below), which representations and warranties shall be true and correct in all respects) at and as of the Closing Date (unless they specifically speak as of an earlier date, in which case they shall be true and correct in all material respects (other than representations and warranties that are qualified as to Subscriber Material Adverse Effect, which representations and warranties shall be true and correct in all respects) as of such date); |
(ii) | such Subscriber shall have performed, satisfied or complied in all material respects with all covenants and agreements required by this Convertible Note Subscription Agreement to be performed, satisfied or complied with by it at or prior to the Closing; provided non-compliance is provided by the Issuer to such Subscriber and such Subscriber fails to cure such noncompliance in all material respects within five (5) Business Days of receipt of such notice; and |
(iii) | prior to or at the Closing Date, such Subscriber shall have delivered such other information and shall have taken all such actions as are reasonably requested to consummate the Closing and to deliver the Convertible Notes and the Subscriber Warrants to such Subscriber or its nominee. |
(i) | all representations and warranties of the Issuer contained in this Convertible Note Subscription Agreement shall be true and correct in all material respects (other than representations and warranties that are qualified as to materiality or Issuer Material Adverse Effect (as defined below), which representations and warranties shall be true and correct in all respects) at and as of the Closing Date (unless they specifically speak as of an earlier date, in which case they shall be true and correct in all material respects (other than representations and warranties that are qualified as to Issuer Material Adverse Effect, which representations and warranties shall be true and correct in all respects) as of such date); |
(ii) | the Issuer shall have performed, satisfied or complied in all material respects with all covenants and agreements required by this Convertible Note Subscription Agreement to be performed, satisfied or complied with by it at or prior to the Closing; provided non-compliance is provided by any Subscriber to the Issuer and the Issuer fails to cure such noncompliance in all material respects within five (5) Business Days of receipt of such notice; |
(iii) | all representations and warranties of the Guarantors contained in this Convertible Note Subscription Agreement shall be true and correct in all material respects (other than representations and warranties that are qualified as to materiality or Guarantor Material Adverse Effect (as defined below), which representations and warranties shall be true and correct in all respects) at and as of the Closing Date (unless they specifically speak as of an earlier date, in which case they shall be true and correct in all material respects (other than representations and warranties that are qualified as to Guarantor Material Adverse Effect, which representations and warranties shall be true and correct in all respects) as of such date); |
(iv) | each Guarantor shall have performed, satisfied or complied in all material respects with all covenants and agreements required by this Convertible Note Subscription Agreement to be performed, satisfied or complied with by it at or prior to the Closing; provided non-compliance is provided by any Subscriber to the Guarantors and the Guarantors fails to cure such noncompliance in all material respects within five (5) Business Days of receipt of such notice; |
(v) | the Transaction Agreement (as it exists on the date of this Convertible Note Subscription Agreement) shall not have been amended in any manner, and no waivers of any terms or provisions of the Transaction Agreement (as it exists on the date of this Convertible Note Subscription Agreement) shall have been given, that has had or would reasonably be expected to have a material and adverse impact on the economic benefits the holders of the Convertible Notes and Subscriber Warrants would reasonably expect to receive under this Convertible Note Subscription Agreement; |
(vi) | the amount of Closing Cash of Issuer shall equal or exceed $21,000,000.00 immediately following the Closing (for purposes of this Convertible Note Subscription Agreement, except as otherwise indicated, “ Closing Cash ” means an amount equal to the sum of (A) the Issuer’s cash on hand and cash in bank deposits (net of any cash on hand or in bank deposits held by the Issuer or the Target by or on behalf of Target’s customers), (B) the aggregate cash proceeds to be released to the Issuer from the Trust Account (as defined in the Transaction Agreement) in connection with the Transactions (after, for the avoidance of doubt, giving effect to any redemptions of Class A Shares (as defined below) by stockholders of the Issuer and after the release of any other funds at Closing, including legal, accounting, financial advisory, and other advisory, transaction or consulting fees and expenses actually paid by the Issuer and the Target |
at Closing) and (C) the Purchase Price paid in connection with this Convertible Note Subscription Agreement); |
(vii) | there has not occurred any Material Adverse Effect (as defined in the Transaction Agreement) or Guarantor Material Adverse Effect after the date of this Convertible Note Subscription Agreement; |
(viii) | such Subscriber shall have received an opinion of Kirkland & Ellis LLP, counsel to the Issuer, and an opinion of Latham & Watkins LLP, counsel to the guarantors of the Convertible Notes (the “ Guarantors ”), in each case, dated the Closing Date and addressed to such Subscriber, in form and substance reasonably satisfactory to the Lead Subscriber and its respective counsel, with respect to the following matters: |
(ix) | (A) the Target shall have caused to be delivered to such Subscriber evidence reasonably satisfactory to such Subscriber that all outstanding indebtedness under (a) that certain Amended and Restated Loan and Security Agreement, dated as of December 12, 2017, by and among Silicon Valley Bank, the Target and Native Brands Group LLC (as amended, restated, amended and restated, supplemented or otherwise modified on or prior to the date hereof, the “ Existing SVB Credit Agreement ”) and (b) that certain Amended and Restated Venture Loan and Security Agreement, dated as of December 2, 2021, by and among Horizon Technology Finance Corporation as a Lender and Collateral Agent, Powerscourt Investments XXV, LP as a Lender, Horizon Fund I, LLC as a Lender, Horizon Credit II LLC as a Lender, the Target, as Borrower Representative and Co-Borrower, and Native Brands Group LLC as a Co-Borrower (as amended, restated, amended and restated, supplemented or otherwise modified on or prior to the date hereof, the “Existing Horizon Credit Agreement ” and, together with the Existing SVB Credit Agreement, the “Existing Credit Agreements ”) (other than contingent obligations that survive the termination of the Existing Credit Agreements), shall have been paid in full, all commitments to extend credit under the Existing Credit Agreements shall have terminated, and all liens securing obligations under the Existing Credit Agreements shall have been released or will, substantially concurrently with the consummation of the Transactions on the Closing Date, be released and (B) immediately after giving effect to the Transactions and the other transactions contemplated hereby, the Issuer and the Guarantors shall have no outstanding indebtedness for borrowed money in an aggregate principal amount in excess of $5,000,000 other than the Convertible Notes; |
(x) | on the Closing Date, the Issuer and the Guarantors shall have executed and delivered a perfection certificate dated as of the Closing Date (the “ Perfection Certificate ”) in form and substance reasonably satisfactory to the Collateral Agent. Except as otherwise provided for in the Security Documents, the Indenture or the other documents entered into in connection with the Transactions, on the Closing Date, the Collateral Agent shall have received the Security Documents and other certificates, agreements or instruments necessary to create a valid security interest in favor of the Collateral Agent, for its benefit and the benefit of the Trustee and the |
holders of the Convertible Notes, in all of the Collateral described in the Security Agreement substantially in form and substance reasonably satisfactory to the Collateral Agent, together with, subject to the requirements of the Security Documents, stock certificates and promissory notes required to be delivered pursuant to the Security Documents, in each case accompanied by instruments of transfer and stock powers undated and endorsed in blank, Uniform Commercial Code financing statements in appropriate form for filing, filings with the United States Patent and Trademark Office and United States Copyright Office in appropriate form for filing where applicable and each such document, instrument or filing shall, unless expressly not required by the Indenture, the Security Documents or applicable law, be executed by the Issuer and the applicable Guarantor, as applicable, and each such document shall be in full force and effect; |
(xi) | such Closing Date shall not be on a date earlier than thirty (30) days following the date of this Agreement; and |
(xii) | the aggregate amount of all fees and expenses incurred by the Issuer, the Company and their respective Subsidiaries in connection with the Transactions, together with the cash portion of the merger consideration in the Transactions, shall not exceed $40 million in the aggregate. |
(i) | The Issuer (i) is duly organized, validly existing and in good standing under the laws of the State of Delaware, (ii) has the requisite power and authority to own, lease and operate its properties, to carry on its business as it is now being conducted and to enter into, deliver and perform its obligations under this Convertible Note Subscription Agreement, and (iii) is duly licensed or qualified to conduct its business and, if applicable, is in good standing under the laws of each jurisdiction (other than its jurisdiction of incorporation) in which the conduct of its business or the ownership of its properties or assets requires such license or qualification, except, with respect to the foregoing clause (iii), where the failure to be in good standing would not reasonably be expected to have an Issuer Material Adverse Effect. For purposes of this Convertible Note Subscription Agreement, an “ Issuer Material Adverse Effect ” means any event, change, development, occurrence, condition or effect (collectively, “Effect ”) that, individually or in the aggregate with all other Effects, (1) is or would reasonably be expected to have a material adverse effect on the business, financial condition, stockholders’ equity or results of operations of the Issuer and its subsidiaries, taken as a whole (after giving effect to the transactions hereunder and under the Transaction Agreement), or (2) materially affects the validity of the Convertible Notes, the Subscriber Warrants, the Underlying Shares or the Underlying Warrant Shares, or the validity or priority and ranking of any lien on collateral securing the Convertible Notes, the legal authority of the Issuer to comply in all material respects with the terms of this Convertible Notes Subscription Agreement, the Indenture or the Warrant Agreement, as applicable, or prevents or materially delays or impairs the ability of the Issuer to timely perform its obligations under this Convertible Note Subscription Agreement or the Transaction Agreement, including the issuance and sale of the Convertible Notes and the Subscriber Warrants. |
(ii) | As of the Closing Date, the shares of Issuer’s Class A common stock, par value $0.0001 per share (the “ Class A Common Shares ”), issuable upon conversion of the Convertible Notes (including any Class A Common Shares deliverable on the account of any make-whole |
premium or make-whole interest pursuant to the terms of the Convertible Notes, the “ Underlying Shares ”) and the Class A Common Shares issuable upon exercise of the Subscriber Warrants (the “Underlying Warrant Shares ”) will be duly authorized and, when issued upon conversion of the Convertible Notes or exercise of the Subscriber Warrants, as applicable, will be validly issued, fully paid and non-assessable, free and clear of any liens or other restrictions (other than those arising under applicable securities laws) and will not have been issued in violation of any preemptive or similar rights created under the Issuer’s organizational documents (as adopted or amended on the Closing Date), by any contract to which the Issuer is a party or by which it is bound, or under the laws of its jurisdiction of incorporation. |
(iii) | This Convertible Note Subscription Agreement and the Transaction Agreement (collectively, the “ Transaction Documents ”) have been duly authorized, executed and delivered by the Issuer, and assuming the due authorization, execution and delivery of the same by the respective counterparties, the Transaction Documents constitute the valid and legally binding obligation of the Issuer, enforceable against the Issuer in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors generally and by the availability of equitable remedies. |
(iv) | The Convertible Notes and the Indenture have been duly authorized by all necessary corporate action of the Issuer, and, on the Closing Date, the Indenture and the Convertible Notes will be duly authorized, executed and delivered by the Issuer and assuming the due authorization, execution and delivery of the same by the Guarantors, the Collateral Agent and the Trustee, the Indenture will constitute the valid and legally binding obligation of the Issuer, enforceable against the Issuer in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought. When issued and sold against receipt of the consideration therefor, the Convertible Notes will be valid and legally binding obligations of the Issuer, enforceable in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought, and will not have been issued in violation of any preemptive rights created under the Issuer’s organizational documents (as adopted or amended on the Closing Date), by any contract to which the Issuer is a party or by which it is bound, or under the laws of its jurisdiction of incorporation. The execution, delivery and performance of the Transaction Documents and the Indenture, the issuance and sale of the Convertible Notes and the compliance by the Issuer with all of the provisions of the Transaction Documents and the Indenture and the consummation of the transactions contemplated herein and therein will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of the Issuer pursuant to the terms of (i) any indenture, mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which the Issuer is a party or by which the Issuer is bound or to which any of the property or assets of the Issuer is subject, in each case, that would reasonably be expected to have an Issuer Material Adverse Effect; (ii) the organizational documents of the Issuer; or (iii) any statute or any judgment, order, rule or regulation of any court or governmental agency or body having jurisdiction over the Issuer or any of its respective properties that would reasonably be expected to have an Issuer Material Adverse Effect. |
(v) | The Subscriber Warrants and the Warrant Agreement have been duly authorized by all necessary corporate action of the Issuer, and, on the Closing Date, the Warrant Agreement and |
the Subscriber Warrants will be duly authorized, executed and delivered by the Issuer and assuming the due authorization, execution and delivery of the same by the warrant agent, the Warrant Agreement will constitute the valid and legally binding obligation of the Issuer, enforceable against the Issuer in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought. When issued and sold against receipt of the consideration therefor, the Subscriber Warrants will be valid and legally binding obligations of the Issuer, enforceable in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought, and will not have been issued in violation of any preemptive rights created under the Issuer’s organizational documents (as adopted or amended on the Closing Date), by any contract to which the Issuer is a party or by which it is bound, or under the laws of its jurisdiction of incorporation. The execution, delivery and performance of the Warrant Agreement, the issuance and sale of the Subscriber Warrants and the compliance by the Issuer with all of the provisions of the Warrant Agreement and the consummation of the transactions contemplated herein and therein will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of the Issuer pursuant to the terms of (i) any indenture, mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which the Issuer is a party or by which the Issuer is bound or to which any of the property or assets of the Issuer is subject, in each case, that would reasonably be expected to have an Issuer Material Adverse Effect; (ii) the organizational documents of the Issuer; or (iii) any statute or any judgment, order, rule or regulation of any court or governmental agency or body having jurisdiction over the Issuer or any of its respective properties that would reasonably be expected to have an Issuer Material Adverse Effect. |
(vi) | Assuming the accuracy of the representations and warranties of each Subscriber set forth in Section 4 of this Convertible Note Subscription Agreement, the Issuer is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority, self-regulatory organization (including Nasdaq or the NYSE, as applicable) or other person in connection with the execution, delivery and performance of this Convertible Notes Subscription Agreement, the Indenture and the Warrant Agreement, the issuance and sale of the Convertible Notes and the Subscriber Warrants and the compliance by the Issuer with all of the provisions of this Convertible Note Subscription Agreement, the Indenture and the Warrant Agreement and the consummation of the transactions contemplated herein and therein, other than (i) filings required by applicable state securities laws, (ii) the filing of the Registration Statement pursuant to Section 5 below and as contemplated by Section 7.4 of the Warrant Agreement, (iii) those required by the SEC or Nasdaq or the NYSE (as applicable), including with respect to obtaining stockholder approval, which shall be completed prior to the Closing, (iv) those required to consummate the Transactions as provided under the Transaction Agreement, (v) the filing of notification under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, if applicable, and (vi) any consent, waiver, authorization, order, notice, filing or registration the failure of which to make or obtain would not be reasonably likely to have an Issuer Material Adverse Effect. |
(vii) | Assuming the accuracy of each Subscriber’s representations and warranties set forth in Section 4 of this Convertible Note Subscription Agreement, (i) no registration under the Securities Act of 1933, as amended (the “Securities Act ”), is required for the offer and sale of the Convertible Notes and Subscriber Warrants by the Issuer to each Subscriber and the issuance of the Underlying Shares and the Underlying Warrant Shares to each Subscriber, and the Convertible Notes, the Subscriber Warrants, the Underlying Shares and the Underlying Warrant Shares are not being offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act or any state securities laws, (ii) it is not necessary to qualify the Indenture under the Trust Indenture Act of 1939, as amended (including the rules and regulations of the Commission promulgated thereunder) and (iii) the Convertible Notes and the Subscriber Warrants are eligible for resale under Rule 144A under the Securities Act. |
(viii) | Neither the Issuer nor any person acting on its behalf has engaged or will engage in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with any offer or sale of the Convertible Notes. |
(ix) | The Issuer has not entered into any agreement or arrangement entitling any agent, broker, investment banker, financial advisor or other person to any broker’s or finder’s fee or any other commission or similar fee in connection with the transactions contemplated by this Convertible Note Subscription Agreement for which any Subscriber could become liable. Except for Jefferies LLC and J. Wood Capital Advisors (acting as co-placement agents to the Issuer and, collectively the “Placement Agents ”), no broker or finder is entitled to any brokerage or finder’s fee or commission solely in connection with the sale of Convertible Notes or Subscriber Warrants to each Subscriber. |
(x) | As of their respective dates, all forms, reports, statements, schedules, prospectuses, proxies, registration statements and other documents required to be filed by the Issuer with the SEC (such reports, the “ SEC Reports ”) complied in all material respects with the applicable requirements of the Securities Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act ”) and the rules and regulations of the SEC promulgated thereunder, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The financial statements of the Issuer included in the SEC Reports were prepared in accordance with generally accepted accounting principles in the United States, consistently applied, comply in all material respects with the rules and regulations of the SEC with respect thereto as in effect at the time of filing and fairly present in all material respects the financial position of the Issuer as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, year-end audit adjustments and the absence of certain footnotes and other presentation items as is permissible under generally accepted accounting principles. Except as disclosed in the SEC Reports, the Issuer timely filed each report, statement, schedule, prospectus, and registration statement that the Issuer was required to file with the SEC since inception. A copy of each SEC Report is available to each Subscriber via the SEC’s EDGAR system. Other than in connection with the Transactions Registration Statement, there are no outstanding or unresolved comments in comment letters received by the Issuer from the staff of the Division of Corporation Finance of the SEC with respect to any of the SEC Reports. |
(xi) | As of the date hereof, the issued and outstanding Class A Common Shares of the Issuer are, and as of the Closing Date, the issued and outstanding Class A Common Shares of the Issuer will be, registered pursuant to Section 12(b) of the Exchange Act, and listed for trading on Nasdaq under the symbol “SWAG” (it being understood that the trading symbol will be changed in connection with the Transactions) or on the NYSE. There is no suit, action, proceeding or investigation pending or, to the knowledge of the Issuer, threatened against the Issuer by |
Nasdaq or the SEC, respectively, to prohibit or terminate the listing of the Class A Common Shares on Nasdaq or to deregister such shares under the Exchange Act, excluding, for purposes of clarity, the customary ongoing review by Nasdaq of the Issuer’s continued listing application in connection with the Transactions. The Issuer has taken no action that is designed to terminate the registration of the Class A Common Shares under the Exchange Act or the listing of the Class A Common Shares on Nasdaq, and is in compliance in all material respects with the continued listing requirements of Nasdaq, except the Issuer may delist Class A Common Shares from Nasdaq in connection with submitting a listing application to the NYSE, in accordance with the NYSE rules, covering the shares of Class A Common Shares. |
(xii) | Except for such matters as have not had or would not reasonably be expected to have, individually or in the aggregate, an Issuer Material Adverse Effect, there is no (i) action, suit, claim or other proceeding, in each case by or before any governmental authority pending, or, to the knowledge of the Issuer, threatened against the Issuer or (ii) judgment, decree, injunction, ruling or order of any governmental entity or arbitrator outstanding against the Issuer. |
(xiii) | The Issuer is in compliance with all applicable laws, except where such noncompliance would not reasonably be expected to have, individually or in the aggregate, an Issuer Material Adverse Effect. The Issuer has not received any written communication from a governmental entity alleging that the Issuer is not in compliance with or is in default or violation of any applicable law, except where such noncompliance, default or violation would not, individually or in the aggregate, reasonably be expected to have an Issuer Material Adverse Effect. |
(xiv) | As of the date of this Convertible Note Subscription Agreement, the authorized capital stock of the Issuer consists of (i) 1,000,000 shares of preferred stock, par value $0.0001 per share (the “ Issuer Preferred Stock ”) and (ii) 110,000,000 shares of common stock, including (1) 100,000,000 shares of Class A Common Shares, and (2) 10,000,000 shares of Class B common stock, par value $0.0001 per share (the “Class B Common Shares ”). As of the date of this Convertible Note Subscription Agreement, (i) no shares of Issuer Preferred Stock are issued and outstanding, (ii) 22,807,868 Class A Common Shares are issued and outstanding, (iii) 5,701,967 shares of Class B Common Shares are issued and outstanding and (iv) 11,403,934 redeemable warrants of the Issuer and 9,982,754 private placement warrants of the Issuer are outstanding. As of the date of this Convertible Note Subscription Agreement, all (i) issued and outstanding shares of Class A Common Shares and Class B Common Shares have been duly authorized and validly issued, are fully paid and are non-assessable and are not subject to preemptive rights and (ii) outstanding warrants of the Issuer have been duly authorized and validly issued, are fully paid and are not subject to preemptive rights. Except as set forth above and pursuant to the Transaction Agreement and the other agreements and arrangements referred to in the Transaction Agreement, as of the date hereof, there are no outstanding options, warrants or other rights to subscribe for, purchase or acquire from the Issuer any Class A Common Shares, Class B Common Shares or other equity interests in the Issuer, or securities convertible into or exchangeable or exercisable for such equity interests. As of the date hereof, the Issuer has no subsidiaries (other than Merger Sub) and does not own, directly or indirectly, interests or investments (whether equity or debt) in any person, whether incorporated or unincorporated. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Issuer is a party or by which it is bound relating to the voting of any securities of the Issuer, as applicable, other than (A) as set forth in the SEC Reports and (B) as contemplated by the Transaction Agreement. There are no securities or instruments issued by or to which the Issuer is a party containing anti-dilution or similar provisions that will be triggered by the issuance of the Convertible Notes, the Subscriber Warrants, the Underlying Shares or the Underlying Warrant Shares that have not been or will not be validly waived on or prior to the Closing Date, including such provisions in the shares of Class B Common Shares pursuant to the terms of the Issuer’s organizational documents (as amended as of the Closing Date). |
(xv) | The operations of the Issuer are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the applicable anti-money laundering statutes of all jurisdictions where the Issuer or any of its subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines issued, administered or enforced by any governmental agency (collectively, the “ Anti-Money Laundering Laws ”); and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Issuer with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Issuer, threatened. |
(xvi) | Neither the Issuer nor, to the knowledge of the Issuer, any director, officer, agent, employee or affiliate of the Issuer is an individual or entity (a “ Person ”) that is, or is owned or controlled by a Person that is, currently the subject or target of any trade, economic or financial sanctions laws, regulations, embargoes or restrictive measures (in each case, having the force of law) administered, enacted or enforced by the U.S. government (including, without limitation, the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC ”), the U.S. Department of Commerce or the U.S. Department of State and including, without limitation, the designation as a “specially designated national” or “blocked person”), the United Nations Security Council, the European Union, Her Majesty’s Treasury, the Cayman Islands or other relevant sanctions authority (collectively, “Sanctions ”), nor is the Issuer located, organized or resident in a country or territory that is the subject or the target of Sanctions, including, without limitation, Cuba, Iran, North Korea, Crimea, Russia and Syria (each, a “Sanctioned Country ”). Since the Issuer’s inception, the Issuer has not knowingly engaged in and is not now knowingly engaged in any dealings or transactions with any Person that at the time of the dealing or transaction is or was the subject or the target of Sanctions or with any Sanctioned Country. |
(xvii) | Each of the Security Documents has been duly authorized by the Issuer, and, when executed and delivered by the Issuer, will constitute a legal and binding agreement of the Issuer in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought. The Security Documents, when executed and delivered by the Issuer in connection with the sale of the Convertible Notes and assuming the due execution and delivery by the Guarantors in connection with the issuance of the Guarantees and the Collateral Agent, will create in favor of the Collateral Agent for the benefit of itself and the holders of the Convertible Notes, valid and enforceable security interests in and liens on substantially all of the tangible and intangible assets of the Issuer and the Guarantors, now owned or hereafter acquired by the Issuer or any Guarantor and all proceeds and products thereof, subject to certain exceptions as described in the Indenture and the Security Documents (the “ Collateral ”) and, upon the filing of appropriate Uniform Commercial Code financing statements in appropriate United States jurisdictions and the taking of the other actions, in each case as further described in the Security Documents, the security interests in and liens on the rights of the Issuer or the applicable Guarantor in such Collateral that can be perfected by such filings or actions will be perfected first priority security interests and liens, superior to and prior to the liens of all third persons other than Permitted Liens (as defined in the Indenture). |
(i) | Each Guarantor (i) is duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, (ii) has the requisite power and authority to own, lease and operate |
its properties, to carry on its business as it is now being conducted and to enter into, deliver and perform its obligations under this Convertible Note Subscription Agreement, and (iii) is duly licensed or qualified to conduct its business and, if applicable, is in good standing under the laws of each jurisdiction (other than its jurisdiction of incorporation) in which the conduct of its business or the ownership of its properties or assets requires such license or qualification, except, with respect to the foregoing clause (iii), where the failure to be in good standing would not reasonably be expected to have a Guarantor Material Adverse Effect. For purposes of this Convertible Note Subscription Agreement, a “ Guarantor Material Adverse Effect ” means any Event that, individually or in the aggregate with all other Effects, (1) is or would reasonably be expected to have a material adverse effect on the business, financial condition, stockholders’ equity or results of operations of the such Guarantor and its subsidiaries, taken as a whole (after giving effect to the transactions hereunder and under the Transaction Agreement), or (2) materially affects the validity of the Convertible Notes or the Underlying Shares, or the validity or priority and ranking of any lien on collateral securing the Convertible Notes, the legal authority of the Issuer to comply in all material respects with the terms of this Convertible Notes Subscription Agreement or the Indenture, as applicable, or prevents or materially impairs the ability of such Guarantor to timely perform its obligations under this Convertible Note Subscription Agreement or the Transaction Agreement, including the issuance and sale of the Convertible Notes. |
(ii) | The Convertible Notes, the Guarantees and the Indenture have been duly authorized by all necessary action of the Guarantors, and, on the Closing Date, the Indenture and the Convertible Notes will be duly authorized, executed and delivered by the Guarantors and assuming the due authorization, execution and delivery of the same by the Issuer, the Collateral Agent and the Trustee, the Indenture will constitute the valid and legally binding obligation of the Guarantors, enforceable against the Guarantors in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought. When issued and sold against receipt of the consideration therefor, the Convertible Notes (including the associated Guarantees) will be valid and legally binding obligations of the Guarantors, enforceable in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought. The execution, delivery and performance of the Transaction Documents and the Indenture, the issuance and sale of the Convertible Notes (including the associated Guarantees) and the compliance by the Guarantors with all of the provisions of the Transaction Documents and the Indenture and the consummation of the transactions contemplated herein and therein will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of any Guarantor pursuant to the terms of (i) any indenture, mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which any Guarantor is a party or by which any Guarantor is bound or to which any of the property or assets of any Guarantor is subject (other than the Existing Credit Agreements), in each case, that would reasonably be expected to have a Guarantor Material Adverse Effect; (ii) the organizational documents of any Guarantor; or (iii) any statute or any judgment, order, rule or regulation of any court or governmental agency or body having jurisdiction over any Guarantor or any of their respective properties that would reasonably be expected to have an Guarantor Material Adverse Effect. |
(iii) | Assuming the accuracy of the representations and warranties of each Subscriber set forth in Section 4 of this Convertible Note Subscription Agreement, the Guarantors are not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority, self-regulatory organization (including Nasdaq or the NYSE, as applicable) or other person in connection with the execution, delivery and performance of this Convertible Notes Subscription Agreement and the Indenture, the issuance and sale of the Convertible Notes and the compliance by the Guarantors with all of the provisions of this Convertible Note Subscription Agreement and the Indenture and the consummation of the transactions contemplated herein and therein, other than (i) filings required by applicable state securities laws, (ii) the filing of the Registration Statement pursuant to Section 5 below, (iii) those required by the SEC or Nasdaq or the NYSE (as applicable), including with respect to obtaining stockholder approval, (iv) those required to consummate the Transactions as provided under the Transaction Agreement, (v) the filing of notification under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, if applicable, and (vi) any consent, waiver, authorization, order, notice, filing or registration the failure of which to make or obtain would not be reasonably likely to have a Guarantor Material Adverse Effect. |
(iv) | Each of the Security Documents has been duly authorized by the applicable Guarantor, as appropriate, and, when executed and delivered by the applicable Guarantor, as appropriate, will constitute a legal and binding agreement of the applicable Guarantor in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought. The Security Documents, when executed and delivered by the applicable Guarantor in connection with the sale of the Convertible Notes and assuming the due execution and delivery by the Issuer and the Collateral Agent, will create in favor of the Collateral Agent for the benefit of itself and the holders of the Convertible Notes, valid and enforceable security interests in and liens on substantially all of the tangible and intangible assets of the Guarantors, now owned or hereafter acquired by any Guarantor and all proceeds and products thereof, subject to certain exceptions as described in the Indenture and the Security Documents (the “ Collateral ”) and, upon the filing of appropriate Uniform Commercial Code financing statements in appropriate United States jurisdictions and the taking of the other actions, in each case as further described in the Security Documents, the security interests in and liens on the rights of the applicable Guarantor in such Collateral that can be perfected by such filings or actions will be perfected first priority security interests and liens, superior to and prior to the liens of all third persons other than Permitted Liens (as defined in the Indenture). |
(i) | when a Registration Statement or any amendment thereto has been filed with the Commission and when any of the foregoing shall have been declared effective by the Commission, and any request by the Commission for an amendment or supplement thereto or to any prospectus included therein; |
(ii) | of the issuance by the Commission of any stop order suspending the effectiveness of any Registration Statement or the initiation of any proceedings for such purpose; |
(iii) | of the receipt by the Issuer of any notification with respect to the suspension of the qualification of the Registrable Securities included therein for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and |
(iv) | subject to the provisions in this Convertible Note Subscription Agreement, of the occurrence of any event that requires the making of any changes in any Registration Statement or prospectus so that, as of such date, the statements therein are not misleading and do not omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case of a prospectus, in the light of the circumstances under which they were made) not misleading. |
(i) | if a Registration Statement registering the resale of the Underlying Shares has not been filed with the Commission prior to the Filing Deadline, then Additional Interest shall accrue on the aggregate outstanding principal amount of the Convertible Notes at a rate of 0.25% per annum for the first ninety (90) days commencing on the first Business Day following the Filing Deadline and 0.50% per annum thereafter; |
(ii) | if a Registration Statement registering the resale of the Underlying Shares has not been declared effective on or prior to the Effectiveness Deadline, then Additional Interest shall accrue on the aggregate outstanding principal amount of the Convertible Notes at a rate of 0.25% per annum for the first ninety (90) days commencing on the first Business Day following Effectiveness Deadline and 0.50% per annum thereafter; |
(iii) | if a Registration Statement registering the resale of the Underlying Shares has been declared or becomes effective but ceases to be effective or ceases to be usable for the offer and sale of the Underlying Shares (other than in connection with (A) a Deferral Period or (B) as a result of a requirement to file a new Registration Statement, a post-effective amendment or supplement to the prospectus contained in such Registration Statement to make changes to the information regarding selling securityholders or the plan of distribution provided for therein) at any time during the Registration Period and the Issuer does not cure the lapse of effectiveness or usability within ten (10) Business Days (or, if a Deferral Period is then in effect, within ten (10) Business Days following the expiration of such Deferral Period), then Additional Interest shall accrue on the aggregate outstanding principal amount of the Convertible Notes at a rate of 0.25% per annum for the first ninety (90) days commencing on the first Business Day following such tenth (10 th ) Business Day and 0.50% per annum thereafter; |
(iv) | if the Issuer, through its omission, fails to name a holder as a selling securityholder any Subscriber that had complied timely with its obligations hereunder in a manner to entitle such Subscriber to be so named in (i) the Registration Statement registering the resale of the Underlying Shares at the time it first became effective or (ii) any prospectus contained in such Registration Statement at the later of time of filing thereof or the time such Registration Statement of which the prospectus forms a part becomes effective, then Additional Interest shall accrue, on the aggregate outstanding principal amount of the Convertible Notes held by such Subscriber, at a rate of 0.25% per annum for the first ninety (90) days beginning on the first Business Day following the effective date of such Registration Statement or the filing of the prospectus contained in such Registration Statement, as applicable, and 0.50% per annum thereafter; and |
(v) | if the aggregate duration of Deferral Periods in respect of any resale of the Underlying Shares in any period exceeds the number of days permitted in respect of such period pursuant to Section 5(b) , then commencing on the day after the aggregate duration of such Deferral Periods in any period exceeds the number of days permitted in respect of such period, Additional Interest shall accrue on the aggregate outstanding principal amount of the Convertible Notes at a rate of 0.25% per annum for the first ninety (90) days beginning on, and including, such date, and 0.50% per annum thereafter; |
SOFTWARE ACQUISITION GROUP INC. III | ||
| ||
By: | Name: | |
Title: | ||
Address for Notices: | ||
| ||
| ||
|
ATTN: | | |
EMAIL: | |
GUARANTORS: | ||
[ ] | ||
By: | | |
Name: | ||
Title: |
Address for Notices: | ||
| ||
| ||
| ||
ATTN: | | |
EMAIL: | | |
Name in which shares are to be registered: | ||
|
SUBSCRIBER: | ||
[ ] | ||
By: | | |
Name: | ||
Title: |
Address for Notices: | ||
| ||
| ||
| ||
ATTN: | | |
EMAIL: | | |
Name in which shares are to be registered: | ||
|
Subscriber |
Principal Amount of Convertible Notes to be Purchased / Purchase Price |
Number of Warrants to be Issued | ||
Total |
Schedule A – Accreted Principal Amount | ||||
Schedule B – Reserved | ||||
Schedule C – Existing Indebtedness |
1 |
Please see below the excluded perfection items we plan to insert in the security agreement in addition to $5 million FMV materiality for fee owned real property. |
(i) | “all asset” filings pursuant to the Uniform Commercial Code in the office of the secretary of state (or similar central filing office) of the relevant state(s) and filings in the applicable real estate records with respect to Material Real Property; |
(ii) | filings in (A) the United States Patent and Trademark Office with respect to any U.S. registered patents and trademarks and (B) the United States Copyright Office of the Library of Congress with respect to material copyright registrations, in the case of each of (A) and (B), constituting Collateral; |
(iii) | Mortgages in respect of Material Real Property; |
(iv) | delivery to the Collateral Agent (or a bailee or other agent of the Collateral Agent) to be held in its possession of all Collateral consisting of (A) certificates representing Pledged Equity, and (B) promissory notes and other instruments constituting Collateral, in each case, in the manner provided in the Collateral Documents; provided that promissory notes and instruments having an aggregate principal amount equal to the pledged collateral threshold or less need not be delivered to the Collateral Agent; |
(v) | perfection of commercial tort claims with a claim value exceeding an amount to be agreed; and |
(vi) | control of all cash and Cash Equivalents pursuant to customary springing account control agreements, which shall be put in place within 45 days of the Issue Date. |
(a) | to take any action (i) outside of the United States with respect to any assets located outside of the United States, (ii) in any non-U.S. jurisdiction or (iii) required by the laws of any non-U.S. jurisdiction to create, perfect or maintain any security interest or otherwise; or |
(b) | to take any action with respect to perfecting a Lien with respect to letters of credit, letter of credit rights, commercial tort claims, chattel paper or assets subject to a certificate of title or similar statute (in each case, other than the filing of customary “all asset” UCC-1 financing statements) or to deliver landlord lien waivers, estoppels, bailee letters or collateral access letters. |
2 |
Amount to be no greater than $75.0 million. |
(1) | such Indebtedness is not secured by any property or assets; |
(2) | if such Indebtedness constitutes indebtedness for borrowed money, it shall not mature or have scheduled amortization prior to the date that is ninety-one (91) days after the Maturity Date at the time such Indebtedness is incurred (other than customary offers to repurchase upon a change of control, asset sale or casualty event and customary acceleration rights after an event of default); and |
(3) | such Indebtedness is not guaranteed by any Person other than the Company and any Guarantor. |
(i) | any issuance of Notes and Common Stock pursuant to this Indenture; |
(ii) | any issuance of shares of Common Stock pursuant to any option, warrant, right or convertible or exchangeable security of the Company or its Subsidiary outstanding as of the Issue Date; |
(iii) | issuance by the Company of any securities, including shares of Common Stock, as full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of all or substantially all of the securities or assets of a corporation or other entity; |
(iv) | the issuance or grant of shares of Common Stock or options to purchase shares of Common Stock pursuant to any present or future employee, director or consultant benefit plan or program of, or assumed by, the Company or any of its Subsidiaries (and for purposes of this definition, “consultant” means a consultant that may participate in an “employee benefit plan” in accordance with the definition of such term in Rule 405 under the Securities Act); |
(v) | the issuance of any shares of Common Stock pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on the Company’s securities and the investment of additional optional amounts in shares of Common Stock under any such plan; and |
(vi) | any issuance of warrants and Common Stock in connection with the SPAC Transactions or the Subscription Agreements. |
(i) | any such sale, including any such sale in connection with the SPAC Transactions, the gross offering proceeds of which (and to the extent the gross offering proceeds of which) do not exceed $20,000,000, taken together with the gross offering proceeds of any other sale that would otherwise be a “Qualifying Sale” by any of the Founders; and |
(ii) | any such sale in connection with a plan pursuant to Rule 10b5-1 under the Exchange Act. |
Term |
Defined in Section |
|||
“Additional Shares” |
5.07(A) |
|||
“Beneficial Ownership Limitations” |
5.11(D) |
|||
“Business Combination Event” |
6.01(A) |
|||
“Ceiling Conversion Rate” |
5.05(A)(vi) |
|||
“Common Stock Change Event” |
5.09(A) |
|||
“Conversion Agent” |
2.06(A) |
|||
“Conversion Consideration” |
5.03(B) |
|||
“Default Interest” |
2.05(B) |
|||
“Defaulted Amount” |
2.05(B) |
|||
“Event of Default” |
7.01(A) |
|||
“Expiration Date” |
5.05(A)(v) |
|||
“Expiration Time” |
5.05(A)(v) |
|||
“Fundamental Change Notice” |
4.02(E) |
|||
“Fundamental Change Repurchase Right” |
4.02(A) |
|||
“General Beneficial Ownership Limitation” |
5.11(D) |
|||
“Guaranteed Obligations” |
9.01(A)(ii) |
|||
“Guarantor Business Combination Event” |
9.04(A) |
|||
“Holder Beneficial Ownership Limitation” |
5.11(D) |
|||
“Initial Notes” |
2.03(A) |
|||
“Interest Make-Whole Payment” |
5.03(A)(ii) |
|||
“Notice of Conversion” |
5.02(A)(ii) |
|||
“Offer Amount” |
3.09 |
|||
“Paying Agent” |
2.06(A) |
|||
“Permitted Debt” |
3.10(B) |
|||
“Permitted Refinancing Indebtedness” |
3.10(B)(v) |
|||
“Reference Property” |
5.09(A) |
|||
“Reference Property Unit” |
5.09(A) |
|||
“refinance” |
3.10(B)(v) |
|||
“Register” |
2.06(B) |
“Registrar” |
2.06(A) |
|||
“Reporting Event of Default” |
7.03(A) |
|||
“Reset Date” |
5.05(A)(vi) |
|||
“Specified Courts” |
11.07 |
|||
“Spin-Off” |
5.05(A)(iii)(2) |
|||
“Spin-Off Valuation Period” |
5.05(A)(iii)(2) |
|||
“Stated Interest” |
2.05(A) |
|||
“Successor Guarantor” |
9.04(A) |
|||
“Successor Person” |
5.09(A) |
|||
“Tender/Exchange Offer Valuation Period” |
5.05(A)(v) |
|||
“Threshold Date” |
3.09 |
|||
“Transaction Offer” |
3.09 |
(A) | “or” is not exclusive; |
(B) | “including” means “including without limitation”; |
(C) | “will” expresses a command; |
(D) | the “average” of a set of numerical values refers to the arithmetic average of such numerical values; |
3 |
To be 15% of the initial principal amount of the Notes. |
4 |
To be 13 months after the closing date. |
5 |
To be 13 months after the closing date. |
6 |
Insert the one-year anniversary of the closing date. |
7 |
Insert the one-year anniversary of the closing date. |
8 |
Insert the two-year anniversary of the closing date. |
9 |
Insert the two-year anniversary of the closing date. |
CR 1 = CR 0 × |
OS 1 |
|||
OS 0 |
where: | ||||||
CR 0 |
= | the Conversion Rate in effect immediately before the Open of Business on the Ex-Dividend Date for such dividend or distribution, or immediately before the Open of Business on the effective date of such stock split or stock combination, as applicable; | ||||
CR 1 |
= | the Conversion Rate in effect immediately after the Open of Business on such Ex-Dividend Date or effective date, as applicable; | ||||
OS 0 |
= | the number of shares of Common Stock outstanding immediately before the Open of Business on such Ex-Dividend Date or effective date, as applicable, without giving effect to such dividend, distribution, stock split or stock combination; and | ||||
OS 1 |
= | the number of shares of Common Stock outstanding immediately after giving effect to such dividend, distribution, stock split or stock combination. |
10 |
The calculation to be done prior to the Issue Date and the greater of (i) and (ii) to be reserved. |
CR 1 = CR 0 × |
OS+X |
|||
OS+Y |
|
where: |
|||||
CR 0 |
= | the Conversion Rate in effect immediately before the Open of Business on the Ex-Dividend Date for such distribution; | ||||
CR 1 |
= | the Conversion Rate in effect immediately after the Open of Business on such Ex-Dividend Date; | ||||
OS |
= | the number of shares of Common Stock outstanding immediately before the Open of Business on such Ex-Dividend Date; | ||||
X |
= | the total number of shares of Common Stock issuable pursuant to such rights, options or warrants; and | ||||
Y |
= | a number of shares of Common Stock obtained by dividing (x) the aggregate price payable to exercise such rights, options or warrants by (y) the average of the Last Reported Sale Prices per share of Common Stock for the ten (10) consecutive Trading Days ending on, and including, the Trading Day immediately before the date such distribution is announced. |
CR 1 = CR 0 × |
SP |
|||
SP-FMV |
where: |
||||||
CR 0 |
= | the Conversion Rate in effect immediately before the Open of Business on the Ex-Dividend Date for such distribution; | ||||
CR 1 |
= | the Conversion Rate in effect immediately after the Open of Business on such Ex-Dividend Date; | ||||
SP |
= | the average of the Last Reported Sale Prices per share of Common Stock for the ten (10) consecutive Trading Days ending on, and including, the Trading Day immediately before such Ex-Dividend Date; and | ||||
FMV |
= | the fair market value (as determined by the Board of Directors), as of such Ex-Dividend Date, of the shares of Capital Stock, evidences of indebtedness, assets, property, rights, options or warrants distributed per share of Common Stock pursuant to such distribution; |
CR 1 = CR 0 × |
FMV+SP |
|||
SP |
where: | ||||||
CR 0 |
= | the Conversion Rate in effect immediately before the Close of Business on the last Trading Day of the Spin-Off Valuation Period for such Spin-Off; |
CR 1 |
= | the Conversion Rate in effect immediately after the Close of Business on the last Trading Day of the Spin-Off Valuation Period; | ||||
FMV |
= | the product of (x) the average of the Last Reported Sale Prices per share or unit of the Capital Stock or equity interests distributed in such Spin-Off over the ten (10) consecutive Trading Day period (the “Spin-Off Valuation PeriodEx-Dividend Date for such Spin-Off (such average to be determined as if references to Common Stock in the definitions of Last Reported Sale Price, Trading Day and Market Disruption Event were instead references to such Capital Stock or equity interests); and (y) the number of shares or units of such Capital Stock or equity interests distributed per share of Common Stock in such Spin-Off; and | ||||
SP |
= | the average of the Last Reported Sale Prices per share of Common Stock for each Trading Day in the Spin-Off Valuation Period. |
CR 1 = CR 0 × |
SP |
|||
SP-D |
where: | ||||||
CR 0 |
= | the Conversion Rate in effect immediately before the Open of Business on the Ex-Dividend Date for such dividend or distribution; | ||||
CR 1 |
= | the Conversion Rate in effect immediately after the Open of Business on such Ex-Dividend Date; | ||||
SP |
= | the Last Reported Sale Price per share of Common Stock on the Trading Day immediately before such Ex-Dividend Date; and | ||||
D |
= | the cash amount distributed per share of Common Stock in such dividend or distribution; |
CR 1 = CR 0 × |
AC (SP OS 1 ) |
|||
SP OS 0 |
where: | ||||||
CR 0 |
= | the Conversion Rate in effect immediately before the Close of Business on the last Trading Day of the Tender/Exchange Offer Valuation Period for such tender or exchange offer; | ||||
CR 1 |
= | the Conversion Rate in effect immediately after the Close of Business on the last Trading Day of the Tender/Exchange Offer Valuation Period; | ||||
AC |
= | the aggregate value (determined as of the time (the “Expiration Time”) such tender or exchange offer expires by the Board of Directors) of all cash and other consideration paid for shares of Common Stock purchased or exchanged in such tender or exchange offer; | ||||
OS 0 |
= | the number of shares of Common Stock outstanding immediately before the Expiration Time (including all shares of Common Stock accepted for purchase or exchange in such tender or exchange offer); | ||||
OS 1 |
= | the number of shares of Common Stock outstanding immediately after the Expiration Time (excluding all shares of Common Stock accepted for purchase or exchange in such tender or exchange offer); and | ||||
SP |
= | the average of the Last Reported Sale Prices per share of Common Stock over the ten (10) consecutive Trading Day period (the “ Tender/Exchange Offer Valuation Period |
11 |
To be 13 months after the closing date. |
12 |
To be 13 months after the closing date. |
13 |
To be 13 months after the closing date. |
14 |
To be 25 months after the closing date. |
15 |
To be 25 months after the closing date. |
16 |
To be 25 months after the closing date. |
17 |
To be the 2 year anniversary of the closing date. |
18 |
To be 12 months after the closing date. |
19 |
To be 12 months and a day after the closing date. |
Make-Whole Fundamental Change Effective Date |
Stock Price |
|||||||||||||||||||||||||||||||||||||||||||||||||||
$9.00 |
$10.00 |
$10.50 |
$11.50 |
$12.50 |
$15.00 |
$17.00 |
$20.00 |
$30.00 |
$50.00 |
$100.00 |
$175.00 |
$320.00 |
||||||||||||||||||||||||||||||||||||||||
[ • ], 2022 |
24.1546 | 23.0440 | 21.4162 | 18.8357 | 16.8840 | 13.5613 | 11.7753 | 9.8410 | 6.2613 | 3.4092 | 1.2765 | 0.3939 | 0.0000 | |||||||||||||||||||||||||||||||||||||||
[ • ], 2023 |
24.1546 | 19.6400 | 17.9657 | 15.4287 | 13.6224 | 10.7727 | 9.3294 | 7.7955 | 4.9723 | 2.7218 | 1.0365 | 0.3306 | 0.0000 | |||||||||||||||||||||||||||||||||||||||
[ • ], 2024 |
24.1546 | 16.5200 | 14.5924 | 11.8530 | 10.0936 | 7.7133 | 6.6506 | 5.5585 | 3.5563 | 1.9590 | 0.7618 | 0.2545 | 0.0000 | |||||||||||||||||||||||||||||||||||||||
[ • ], 2025 |
24.1546 | 13.5140 | 10.9514 | 7.5991 | 5.8176 | 4.1160 | 3.5429 | 2.9690 | 1.9060 | 1.0560 | 0.4187 | 0.1465 | 0.0000 | |||||||||||||||||||||||||||||||||||||||
[ • ], 2026 |
24.1546 | 13.0430 | 8.2819 | 0.0000 | 0.0000 | 0.0000 | 0.0000 | 0.0000 | 0.0000 | 0.0000 | 0.0000 | 0.0000 | 0.0000 |
S OFTWARE ACQUISITION GROUP INC . III | ||
By: | ||
Name: | ||
Title: | ||
U.S. B ANK TRUST COMPANY , NATIONAL ASSOCIATION , AS TRUSTEE | ||
By: | ||
Name: | ||
Title: |
CUSIP No.: | [ 20 |
Certificate No. [ | ||
ISIN No.: | [ 21 |
Interest Payment Dates: | [ • ] and [ • ] of each year, commencing on [ • ]. | |||
Regular Record Dates: | [ • ] and [ • ] (whether or not a Business Day). |
20 |
Insert for Global Notes only. |
21 |
Insert for Global Notes only. |
22 |
Insert bracketed language for Global Notes only. |
SOFTWARE ACQUISITION GROUP INC. III | ||||||
Date: |
By: | |||||
Name: | ||||||
Title: |
Date: |
By: | |||||
Authorized Signatory |
Date |
Amount of Increase (Decrease) in Original Principal Amount of this Global Note |
Original Principal Amount of this Global Note After Such Increase (Decrease) |
Signature of Authorized Signatory of Trustee | |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
| |||
|
|
|
|
23 |
Insert for Global Notes only. |
☐ | the entire principal amount of |
☐ | $ ___________ 24 aggregate principal amount of |
Date: | |
| ||||||
(Legal Name of Holder) | ||||||||
By: | | |||||||
Name: | ||||||||
Title: | ||||||||
Signature Guaranteed: | ||||||||
| ||||||||
Participant in a Recognized Signature | ||||||||
Guarantee Medallion Program | ||||||||
By: | | |||||||
Authorized Signatory |
24 |
Must be an Authorized Denomination. |
☐ | the entire principal amount of |
☐ | $ __________ 25 aggregate principal amount of |
Date: | |
| ||||||
(Legal Name of Holder) | ||||||||
By: | | |||||||
Name: | ||||||||
Title: | ||||||||
Signature Guaranteed: | ||||||||
| ||||||||
Participant in a Recognized Signature | ||||||||
Guarantee Medallion Program | ||||||||
By: | | |||||||
Authorized Signatory |
25 |
Must be an Authorized Denomination. |
Name: | ||
Address: | ||
Social security or tax identification number: |
Date: |
| |||||
(Legal Name of Holder) | ||||||
By: | ||||||
Name: | ||||||
Title: | ||||||
Signature Guaranteed: | ||||||
| ||||||
Participant in a Recognized Signature Guarantee Medallion Program | ||||||
By: | ||||||
Authorized Signatory |
1. | ☐ | Such Transfer is being made to the Company or a Subsidiary of the Company. | ||
2. | ☐ | Such Transfer is being made pursuant to, and in accordance with, a registration statement that is effective under the Securities Act at the time of the Transfer. | ||
3. | ☐ | Such Transfer is being made pursuant to, and in accordance with, Rule 144A under the Securities Act, and, accordingly, the undersigned further certifies that the within Note is being transferred to a Person that the undersigned reasonably believes is purchasing the within Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act in a transaction meeting the requirements of Rule 144A. If this item is checked, then the transferee must complete and execute the acknowledgment contained on the next page | ||
4. | ☐ | Such Transfer is being made pursuant to, and in accordance with, any other available exemption from the registration requirements of the Securities Act (including, if available, the exemption provided by Rule 144 under the Securities Act). |
Dated: | ||
(Legal Name of Holder) |
By: | ||
Name: | ||
Title: | ||
Signature Guaranteed: | ||
(Participant in a Recognized Signature Guarantee Medallion Program) | ||
By: | ||
Authorized Signatory |
Dated: | ||
(Name of Transferee) |
By: | ||
Name: | ||
Title: |
(1) | REPRESENTS THAT IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, AND |
(2) | AGREES FOR THE BENEFIT OF SOFTWARE ACQUISITION GROUP INC. III (THE “COMPANY”) THAT IT WILL NOT OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS NOTE AND THE SHARES OF CLASS A COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN, EXCEPT ONLY: |
(A) | TO THE COMPANY OR ANY SUBSIDIARY THEREOF; |
(B) | PURSUANT TO A REGISTRATION STATEMENT THAT IS EFFECTIVE UNDER THE SECURITIES ACT; |
(C) | TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT; |
(D) | PURSUANT TO RULE 144 UNDER THE SECURITIES ACT; OR |
(E) | PURSUANT TO ANY OTHER EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. |
(A) | TO THE COMPANY OR ANY SUBSIDIARY THEREOF; |
(B) | PURSUANT TO A REGISTRATION STATEMENT THAT IS EFFECTIVE UNDER THE SECURITIES ACT; |
(C) | TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT; |
(D) | PURSUANT TO RULE 144 UNDER THE SECURITIES ACT; OR |
(E) | PURSUANT TO ANY OTHER EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. |
SOFTWARE ACQUISITION GROUP INC. III | ||
By: |
Name: | ||
Title: |
[GUARANTEEING SUBSIDIARY] | ||
By: |
Name: | ||
Title: |
U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee | ||
By: |
Name: | ||
Title: |
[GUARANTORS] | ||
By: | ||
Name: | ||
Title: |
[ • ], 2022 |
$1,000.00 | |
[ • ], 2022 |
$1,015.00 | |
[ • ], 2023 |
$1,030.23 | |
[ • ], 2023 |
$1,045.68 | |
[ • ], 2024 |
$1,061.36 | |
[ • ], 2024 |
$1,077.28 | |
[ • ], 2025 |
$1,093.44 | |
[ • ], 2025 |
$1,109.84 | |
[ • ], 2026 |
$1,126.49 |
SOFTWARE ACQUISITION GROUP INC. III | ||
By: | | |
Name: Jonathan S. Huberman | ||
Title: Chief Executive Officer | ||
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, | ||
By: | | |
Name: James F. Kiszka | ||
Title: Vice President |
SOFTWARE ACQUISITION GROUP INC. III | ||
By: | | |
Name: | Jonathan S. Huberman | |
Title: | Chief Executive Officer and Chief Financial Officer |
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Warrant Agent | ||
By: | | |
Name: | ||
Title: |
Date: [ ], 2022 |
|
(Signature) |
|
(Address) |
|
(Tax Identification Number) |
* | To be filed by amendment. |
A. | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
(i) | To include any prospectus required by section 10(a)(3) of the Securities Act; |
(ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement. |
(iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; |
B. | That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
C. | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
D. | That, for the purpose of determining liability under the Securities Act to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. |
E. | That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
(i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
(ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
(iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
(iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
F. | That prior to any public reoffering of the securities registered hereunder through use of a prospectus which is a part of this registration statement, by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c), the issuer undertakes that such reoffering prospectus will contain the information called for by the applicable registration form with respect to reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form. |
G. | That every prospectus (i) that is filed pursuant to paragraph (F) immediately preceding, or (ii) that purports to meet the requirements of section 10(a)(3) of the Securities Act and is used in connection with an offering of securities subject to Rule 415, will be filed as a part of an amendment to the registration statement and will not be used until such amendment is effective, and that, for purposes of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
H. | Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. |
I. | To respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11 or 13 of this form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request. |
J. | To supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. |
SOFTWARE ACQUISITION GROUP INC. III | ||
By: | /s/ Jonathan S. Huberman | |
Name: | Jonathan S. Huberman | |
Title: | Chief Executive Officer |
Signature |
Title |
Date | ||
/s/ Jonathan S. Huberman Jonathan S. Huberman |
Chairman, Chief Executive Officer and Chief Financial Officer (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) | June 29, 2022 | ||
* Mike Nikzad |
Vice President of Acquisitions and Director | June 29, 2022 | ||
* Andrew Nikou |
Director |
June 29, 2022 | ||
* C. Matthew Olton |
Director |
June 29, 2022 | ||
* Stephanie Davis |
Director |
June 29, 2022 | ||
* Steven Guggenheimer |
Director |
June 29, 2022 | ||
* Dr. Peter H. Diamandis |
Director |
June 29, 2022 |
* | The undersigned, by signing his name hereto, signs and executes this Amendment to the Registration Statement pursuant to the Powers of Attorney executed by the above named signatures and previously filed with the Securities and Exchange Commission on February 14, 2022. |
/s/ Jonathan S. Huberman |
Jonathan S. Huberman |
Attorney-in-Fact |