Item 1.01. Entry into a Material Definitive Agreement.
Merger Agreement
On
Latch is an enterprise technology company focused on revolutionizing the way people experience spaces by making spaces better places to live, work, and visit. Latch has created a full-building operating system, LatchOS, that addresses the essential needs of modern buildings by streamlining building operations, enhancing the resident experience, and enabling more efficient interactions with service providers.
Upon the terms and subject to the conditions set forth in the Merger Agreement,
at the effective time of the Merger (the "Effective Time"), each share of Latch
common stock, par value
In addition, as of the Effective Time, (i) each option to purchase Latch common
stock (a "Company Option"), other than the Cash Elected Company Options (as
defined below), whether vested or unvested, that is outstanding immediately
prior to the Effective Time will be assumed and converted into an option with
respect to a number of shares of Common Stock in the manner set forth in the
Merger Agreement, (ii) each award of restricted stock units with respect to
shares of Latch common stock (a "Company RSU") that is outstanding immediately
prior to the Effective Time will be assumed and converted into the right to
receive an award of restricted stock units denominated in a number of shares of
Common Stock in the manner set forth in the Merger Agreement and (iii) each
vested Company Option with respect to which an election to receive only cash
consideration has been properly made (a "Cash Elected Company Option") will be
converted into the right to receive an amount in cash as set forth in the Merger
Agreement, subject to an aggregate cap on the cash consideration payable with
respect to all Cash Elected Company Options of
The consummation of the proposed Transactions is subject to the receipt of the requisite approval of the stockholders of each of TSIA and Latch (such approvals, the "TSIA stockholder approval" and the "Latch stockholder approval," respectively) and the fulfillment of certain other conditions.
Representations and Warranties
The Merger Agreement contains customary representations and warranties of the parties thereto with respect to, among other things, (a) entity organization, formation and authority, (b) capital structure, (c) authorization to enter into the Merger Agreement, (d) approvals and permits, (e) financial statements, (f) absence of changes, (g) absence of undisclosed liabilities, (h) litigation, (i) employee matters, (j) compliance with laws, (k) taxes, (l) real property, (m) intellectual property and (n) material contracts.
Covenants
The Merger Agreement includes customary covenants of the parties with respect to operation of the business prior to consummation of the Transactions and efforts to satisfy conditions to consummation of the Transactions. The Merger Agreement also contains additional covenants of the parties, including, among others, (a) covenants providing for TSIA and Latch to use reasonable best efforts to obtain all necessary regulatory approvals and (b) covenants providing for TSIA, Merger Sub and Latch to cooperate in the preparation of the Registration Statement and Proxy Statement (as each such term is defined in the Merger Agreement) required to be filed in connection with the Transactions.
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TSIA Incentive Plan
Prior to the Closing, TSIA will adopt the TSIA Incentive Plan (as defined in the Merger Agreement) subject to the receipt of the TSIA stockholder approval.
Latch Non-Solicitation Restrictions
Except as expressly permitted by the Merger Agreement, from the date of the Merger Agreement to the Effective Time or, if earlier, the valid termination of the Merger Agreement in accordance with its terms, Latch has agreed not to, among other things, (i) initiate any negotiations with any person with respect to, or provide any non-publicinformation or data concerning any Latch to any person relating to, an Acquisition Proposal or Alternative Transaction (as defined in the Merger Agreement) or afford to any person access to the business, properties, assets or personnel of Latch in connection with an Acquisition Proposal or Alternative Transaction or (ii) enter into any acquisition agreement, merger agreement or similar definitive agreement, or any letter of intent, memorandum of understanding or agreement in principle, or any other agreement relating to an Acquisition Proposal or Alternative Transaction.
TSIA Exclusivity Restrictions
From the date of the Merger Agreement to the Effective Time or, if earlier, the valid termination of the Merger Agreement in accordance with its terms, TSIA has agreed not to, among other things, solicit, initiate, continue or engage in discussions or negotiations with, or enter into any agreement, letter of intent, memorandum of understanding or agreement in principle with, or encourage, respond, provide information to or commence due diligence with respect to, any person (other than Latch, its stockholders or any of their affiliates or representatives), concerning, relating to or which is intended or is reasonably likely to give rise to or result in any Business Combination Proposal (as defined in the Merger Agreement) other than with Latch, its stockholders and their affiliates or representatives.
Conditions to
The obligation of TSIA and Latch to consummate the Merger is subject to certain closing conditions, including, but not limited to, (i) the expiration or termination of the applicable waiting period under the HSR Act, (ii) the approval of TSIA's shareholders, (iii) the approval of Latch's shareholders and (iv) the Registration Statement becoming effective.
In addition, the obligation of TSIA to consummate the Merger is subject to the fulfillment of other closing conditions, including, but not limited to, the . . .
Item 3.02 Unregistered Sales of
The information set forth above in Item 1.01 of this Report under the heading "Subscription Agreements" is incorporated by reference herein. The shares of Common Stock to be issued in connection with the Subscriptions and the transactions contemplated thereby will not be registered under the Securities Act, in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act.
Item 7.01. Regulation FD Disclosure.
On
Furnished as Exhibit 99.2 hereto and incorporated into this Item 7.01 by reference is the investor presentation that TSIA and Latch have prepared for use in connection with the announcement of the Merger.
The foregoing (including Exhibits 99.1 and 99.2) is being furnished pursuant to Item 7.01 and will not be deemed to be filed for purposes of Section 18 of the Exchange Act, or otherwise be subject to the liabilities of that section, nor will it be deemed to be incorporated by reference in any filing under the Securities Act or the Exchange Act.
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IMPORTANT ADDITIONAL INFORMATION AND WHERE TO FIND IT
This document relates to a proposed transaction between Latch and TSIA. This
document does not constitute an offer to sell or exchange, or the solicitation
of an offer to buy or exchange, any securities, nor shall there be any sale of
securities in any jurisdiction in which such offer, sale or exchange would be
unlawful prior to registration or qualification under the securities laws of any
such jurisdiction. TSIA intends to file a registration statement on Form S-4
that will include a proxy statement of TSIA and a prospectus of TSIA. The proxy
statement/prospectus will be sent to all TSIA and Latch stockholders. TSIA also
will file other documents regarding the proposed transaction with the
Investors and security holders will be able to obtain free copies of the proxy
statement/prospectus and all other relevant documents filed or that will be
filed with the
PARTICIPANTS IN SOLICITATION
TSIA and Latch and their respective directors and officers may be deemed to be
participants in the solicitation of proxies from TSIA's stockholders in
connection with the proposed transaction. Information about TSIA's directors and
executive officers and their ownership of TSIA's securities is set forth in
TSIA's filings with the
FORWARD-LOOKING STATEMENTS
This document contains certain forward-looking statements within the meaning of the federal securities laws with respect to the proposed transaction between Latch and TSIA, including statements regarding the benefits of the transaction, the anticipated timing of the transaction, the services offered by Latch and the markets in which it operates, and Latch's projected future results. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this document, including but not limited to: (i) the risk that the transaction, including the contemporaneous private placement of equity securities (the "PIPE investment"), may not be completed in a timely manner or at all, which may adversely affect the price of TSIA's securities, (ii) the risk that the transaction may not be completed by TSIA's business combination deadline and the potential failure to obtain an extension of the business combination deadline if sought by TSIA, (iii) the failure to satisfy the conditions to the consummation of the transaction, including the adoption of the agreement and plan of merger by the stockholders of TSIA and Latch, the satisfaction of the minimum trust account amount following redemptions by TSIA's public stockholders and the receipt of certain governmental and regulatory approvals, (iv) the lack of a third party valuation in determining whether or not to pursue the proposed transaction, (v) the occurrence of any event, change or other circumstance that could give rise to the termination of the agreement and plan of merger or the termination of any PIPE investor's subscription agreement, (vi) the effect of the announcement or pendency of the transaction on Latch's business relationships, performance, and business generally, (vii) risks that the proposed transaction disrupts current plans of Latch or diverts management's attention from Latch's ongoing business operations and potential difficulties in Latch employee retention as a result of the proposed
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transaction, (viii) the outcome of any legal proceedings that may be instituted
against Latch, TSIA or their respective directors or officers related to the
agreement and plan of merger or the proposed transaction, (ix) the amount of the
costs, fees, expenses and other charges related to the proposed transaction and
PIPE investment, (x) the ability to maintain the listing of TSIA's securities on
NASDAQ, (xi) the price of TSIA's securities may be volatile due to a variety of
factors, including changes in the competitive and highly regulated industries in
which Latch plans to operate, variations in performance across competitors,
changes in laws and regulations affecting Latch's business and changes in the
combined capital structure, (xii) the ability to implement business plans,
forecasts, and other expectations after the completion of the proposed
transaction, and identify and realize additional opportunities, including the
conversion of pre-orders into binding orders, (xiii) the amount of redemption
requests made by TSIA's public stockholders, (xiv) the ability of TSIA to issue
equity or equity-linked securities in connection with the transaction or in the
future, (xv) possible variances between the unaudited historical financial
information Latch presents and its audited financial statements, when they
become available and (xvi) the impact of the global COVID-19 pandemic on any of
the foregoing. The foregoing list of factors is not exhaustive. You should
carefully consider the foregoing factors and the other risks and uncertainties
described in the "Risk Factors" section of TSIA's Registration Statement on Form
S-1, the registration statement on Form S-4 and proxy statement/prospectus
described below and other documents filed by TSIA from time to time with the
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits: Exhibit Description 2.1* Agreement and Plan of Merger dated as ofJanuary 24, 2021 , by and amongTS Innovation Acquisitions Corp. ,Lionet Merger Sub Inc. andLatch, Inc. 10.1* Sponsor Support Agreement, dated as ofJanuary 24, 2021 , by and among TS Innovation Acquisitions Sponsor, L.L.C,TS Innovation Acquisitions Corp. ,Latch, Inc. and certain other parties thereto. 10.2* Company Holders Support Agreement, dated as ofJanuary 24, 2021 , by and amongTS Innovation Acquisitions Corp. ,Latch, Inc. and certain other parties thereto. 10.3 Form of Subscription Agreement. 99.1 Press Release issued by TSIA and Latch onJanuary 25, 2021 . 99.2 Investor Presentation, datedJanuary 25, 2021 .
* Certain exhibits and schedules to this Exhibit have been omitted in accordance
with Regulation S-K Item 601(b)(2). TSIA agrees to furnish supplementally a
copy of all omitted exhibits and schedules to the Securities and Exchange
Commission upon its request.
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