Item 1.01 Entry Into A Material Definitive Agreement.
Business Combination Agreement
On February 7, 2021, ARYA Sciences Acquisition Corp III, a Cayman Islands exempted company (“ARYA”), entered into a Business Combination
Agreement (as it may be amended, supplemented or otherwise modified from time to time, the “Business Combination Agreement”), by and among ARYA, Mako Merger Sub, Inc., a Delaware corporation (“Merger Sub”), and Nautilus Biotechnology, Inc., a Delaware corporation (“Nautilus”).
The Business Combination Agreement and the transactions contemplated thereby were approved by the boards of directors of each of ARYA and Nautilus.
The Business Combination Agreement provides for, among other things, the following transactions: (i) Nautilus will changes its name to “Nautilus Subsidiary, Inc.” (or another name
mutually agreed to by ARYA and Nautilus); (ii) ARYA will become a Delaware corporation (the “Domestication”) and, in connection with the Domestication, (A) ARYA’s name will be changed to “Nautilus
Biotechnology, Inc.” (“New Nautilus”) and (B) each outstanding Class A ordinary share of ARYA and each outstanding Class B ordinary share of ARYA will become one share of common stock of New Nautilus (the “New Nautilus Common Stock”); and (iii) following the Domestication, Merger Sub will merge with and into Nautilus, with Nautilus as the surviving company in the merger
and, after giving effect to such merger, continuing as a wholly-owned subsidiary of New Nautilus (the “Merger”).
The Domestication, the Merger and the other transactions contemplated by the Business Combination Agreement are hereinafter referred to as the “Business
Combination”.
The Business Combination is expected to close in the second quarter of 2021, following the receipt of the required approval by ARYA’s shareholders and the fulfillment of other
customary closing conditions.
Business Combination Consideration
In accordance with the terms and subject to the conditions of the Business Combination Agreement, outstanding shares of Nautilus (other than treasury shares and any Company
Dissenting Shares (as defined in the Business Combination Agreement) will be exchanged for shares of New Nautilus Common Stock and outstanding Nautilus options to purchase shares of Nautilus (whether vested or unvested) will be exchanged for
comparable options to purchase New Nautilus Common Stock, in each case, based on an implied Nautilus equity value of $900 million.
Representations and Warranties; Covenants
The Business Combination Agreement contains representations, warranties and covenants of each of the parties thereto that are customary for transactions of this type. ARYA has also
agreed to take all action as may be necessary or reasonably appropriate such that, as of the effective time of the Business Combination, the ARYA board of directors will consist of nine directors, which shall be divided into three classes and be
comprised of seven individuals determined by Nautilus prior to the effectiveness of the Registration Statement, one individual determined by ARYA Sponsor prior to the effectiveness of the Registration Statement and one director that may designated
by Nautilus and that is reasonably acceptable to ARYA Sciences Holdings III (“ARYA Sponsor”) prior to the effectiveness of the Registration Statement (provided that if no individual is designated as of such
time, then such director seat shall be vacant following the effective time of the merger until an individual is elected or appointed to such directorship in accordance with the New Nautilus governing documents). In addition, ARYA has agreed to
adopt an equity incentive plan and employee stock purchase plan, as described in the Business Combination Agreement.
Conditions to Each Party’s Obligations
The obligation of ARYA and Nautilus to consummate the Business Combination is subject to certain closing conditions, including, but not limited to, (i) the expiration or termination
of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, (ii) the absence of any order, law or other legal restraint or prohibition issued by any court of competent jurisdiction or other
governmental entity of competent jurisdiction enjoining or prohibiting the consummation of the Domestication or the Merger, (iii) the effectiveness of the Registration Statement on Form S-4 (the “Registration
Statement”) in accordance with the provisions of the Securities Act registering the ARYA Common Stock to be issued in the Merger and the Domestication, (iv) the required approvals of ARYA’s shareholders, (v) the approval of Nautilus’s
shareholders, (iv) ARYA having at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Securities Exchange Act of 1934, as amended) remaining after the closing of the Business Combination, and (vii) the
approval by Nasdaq of ARYA’s initial listing application in connection with the Business Combination.
In addition, the obligation of Nautilus to consummate the Business Combination is subject to the fulfillment of other closing conditions, including, but not limited to, (i) the
aggregate cash proceeds from ARYA’s trust account, together with the proceeds from the PIPE Financing (as defined below), equaling no less than $250,000,000 (after deducting any amounts paid to ARYA shareholders that exercise their redemption
rights in connection with the Business Combination and net of ARYA’s unpaid transaction expenses and ARYA’s unpaid liabilities), and (ii) the consummation of the Domestication.
Termination
The Business Combination Agreement may be terminated under certain customary and limited circumstances prior to the closing of the Business Combination, including, but not limited
to, (i) by mutual written consent of ARYA and Nautilus, (ii) by ARYA if the representations and warranties of Nautilus are not true and correct or if Nautilus fails to perform any covenant or agreement set forth in the Business Combination
Agreement such that certain conditions to closing cannot be satisfied and the breach or breaches of such representations or warranties or the failure to perform such covenant or agreement, as applicable, are not cured or cannot be cured within
certain specified time periods, (iii) termination by Nautilus if the representations and warranties of ARYA or Merger Sub (the “ARYA Parties”) are not true and correct or if any ARYA Party fails to perform
any covenant or agreement set forth in the Business Combination Agreement such that certain conditions to closing cannot be satisfied and the breach or breaches of such representations or warranties or the failure to perform such covenant or
agreement, as applicable, are not cured or cannot be cured within certain specified time periods, (iv) subject to certain limited exceptions, by either ARYA or Nautilus if the Business Combination is not consummated by 11:59 P.M. (pacific time) on
August 6, 2021, (v) by either ARYA or Nautilus if certain required approvals are not obtained from ARYA shareholders after the conclusion of a meeting of ARYA’s shareholders held for such purpose at which such shareholders voted on such approvals,
(vi) either ARYA or Nautilus, if any governmental entity of competent jurisdiction shall have issued an order permanently enjoining or prohibiting the Merger or the Domestication and such order shall have become final and nonappealable, and (vii)
termination by ARYA if Nautilus has not delivered to ARYA a written consent of the Nautilus shareholders approving the Business Combination and the transactions contemplated thereby (including the Merger) within five business days of the
Registration Statement being declared effective under the Securities Act of 1933, as amended (the “Securities Act”).
If the Business Combination Agreement is validly terminated, none of the parties to the Business Combination Agreement will have any liability or any further obligation under the
Business Combination Agreement, except in the case of Willful Breach or Fraud (each, as defined in the Business Combination Agreement) and for customary obligations that survive the termination thereof (such as confidentiality obligations).
A copy of the Business Combination Agreement is filed with this Current Report on Form 8-K as Exhibit 2.1 and is incorporated herein by reference, and the foregoing description of
the Business Combination Agreement is qualified in its entirety by reference thereto. The Business Combination Agreement contains representations, warranties and covenants that the respective parties made to each other as of the date of the
Business Combination Agreement or other specific dates, as specified therein. The assertions embodied in those representations, warranties and covenants were made for purposes of the contract among the respective parties and are subject to
important qualifications and limitations agreed to by the parties in connection with negotiating such agreement. The representations, warranties and covenants in the Business Combination Agreement are also modified in important part by the
underlying disclosure schedules which are not filed publicly and which are subject to a contractual standard of materiality different from that generally applicable to shareholders and were used for the purpose of allocating risk among the parties
rather than establishing matters as facts. ARYA does not believe that these schedules contain information that is material to an investment decision.
Concurrently with the execution of the Business Combination Agreement, ARYA, ARYA Sciences Holdings III, a Cayman Islands exempted limited company (the “Sponsor”), and each other holder of Class B ordinary shares of ARYA (the “Other Class B Shareholders”) and Nautilus entered into the Sponsor Letter Agreement (the “Sponsor Letter Agreement”), pursuant to which the Sponsor and the Other Class B Shareholders, among other things, (i) vote in favor of each of the transaction proposals to be voted upon at the meeting of ARYA shareholders,
including approval of the Business Combination Agreement and the transactions contemplated thereby (including the Merger) and (ii) waive any adjustment to the conversion ratio set forth in the governing documents of ARYA or any other anti-dilution
or similar protection with respect to the Class B ordinary shares (whether resulting from the transactions contemplated by the Subscription Agreements (as defined below) or otherwise); and (iii) be bound by certain transfer restrictions with
respect to his, her or its shares in ARYA prior to the closing of the Business Combination, in each case, on the terms and subject to the conditions set forth in the Sponsor Letter Agreement.
A copy of the Sponsor Letter Agreement is filed with this Current Report on Form 8-K as Exhibit 10.1 and is incorporated herein by reference, and the foregoing description of the
Sponsor Letter Agreement is qualified in its entirety by reference thereto.
PIPE Financing (Private Placement)
Concurrently with the execution of the Business Combination Agreement, ARYA entered into subscription agreements (the “Subscription Agreements”)
with certain investors, including, among others, Perceptive Life Sciences Master Fund Ltd., a fund managed by Perceptive Advisors, an affiliate of the Sponsor, as well as certain equity holders of Nautilus and additional third party investors.
Pursuant to the Subscription Agreements, each investor agreed to subscribe for and purchase, and ARYA agreed to issue and sell to such investors, on the Closing Date (as defined in the Business Combination Agreement) immediately prior to the
Closing (as defined in the Business Combination Agreement), an aggregate of 20,000,000 shares of ARYA Common Stock for a purchase price of $10.00 per share, for aggregate gross proceeds of $200,000,000 (the “PIPE
Financing”).
The closing of the PIPE Financing is contingent upon, among other things, the substantially concurrent consummation of the Business Combination. The Subscription Agreements provide
that ARYA will grant the investors in the PIPE Financing certain customary registration rights.
A copy of the form of Subscription Agreement is filed with this Current Report on Form 8-K as Exhibit 10.3 and is incorporated herein by reference, and the foregoing description of
the Subscription Agreements is qualified in its entirety by reference thereto.
Transaction Support Agreements
Within 24 hours of the signing of the Business Combination Agreement, certain directors, officers and stockholders of Nautilus entered into a Transaction Support Agreement
(collectively, the “Transaction Support Agreements”) with ARYA, pursuant to which such parties have agreed to, among other things, (i) support and vote in favor of the Business Combination Agreement and the
transactions contemplated thereby (including the Merger), and (ii) be bound by certain other covenants and agreements related to the Business Combination, including a restriction on transfers with respect to his, her or its shares in Nautilus prior
to the closing of the Business Combination.
A copy of the form of Transaction Support Agreement is filed with this Current Report on Form 8-K as Exhibit C to Exhibit 2.1 and is incorporated herein by reference, and the
foregoing description of the Transaction Support Agreements is qualified in its entirety by reference thereto.
Amended and Restated Registration Rights and Lock-Up Agreement
Concurrently with the execution of the Business Combination Agreement, ARYA, the Perceptive Shareholders, the Other Class B Shareholders and certain Nautilus shareholders entered
into an amended and restated registration rights and lock-up agreement (the “A&R Registration Rights and Lock-Up Agreement”) pursuant to which, among other things, the Perceptive Shareholders (as defined
in the Business Combination Agreement), the Other Class B Shareholders (as defined in the Business Combination Agreement) and the certain Nautilus shareholders agreed not to effect any sale or distribution of ARYA equity securities during the
lock-up period described therein and will be granted certain customary registration rights, in each case subject to, and conditioned upon and effective as of, the effective time of the Merger.
A copy of the A&R Registration Rights and Lock-Up Agreement is filed with this Current Report on Form 8-K as Exhibit 10.2 and is incorporated herein by reference, and the
foregoing description of the A&R Registration Rights and Lock-Up Agreement is qualified in its entirety by reference thereto.