Item 1.01
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Entry into a Material Definitive Agreement.
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Merger Agreement
On June 11, 2020, Forum
Merger II Corporation, a Delaware corporation (“Forum”), entered into an Agreement and Plan of Merger (the “Merger
Agreement”) with Sprout Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Forum (“Merger
Sub”), Myjojo, Inc., a Delaware corporation (“Ittella Parent”) and Salvatore Galletti, in his capacity
as the holder representative. Pursuant to the transactions contemplated by the terms of the Merger Agreement, and subject to the
satisfaction or waiver of certain conditions set forth therein, Merger Sub will merge with and into Ittella Parent (the “Merger”),
with Ittella Parent surviving the merger in accordance with the Delaware General Corporation Law as a wholly owned subsidiary of
Forum (the transactions contemplated by the Merger Agreement and the related ancillary agreements, the “Business Combination”).
Consideration and Sponsor Earnout Shares
The aggregate consideration
payable at the closing of the Business Combination (the “Closing”) to the stockholders of Ittella Parent is
approximately $420 million, subject to the purchase price adjustments as set forth in the Merger Agreement (the “Closing
Merger Consideration”). The Closing Merger Consideration is required to be comprised of between $50 million and $75 million
in cash, with the remainder of the Closing Merger Consideration comprised of Forum’s common stock, valued at $10.00 per share.
An additional 5,000,000
shares of Forum’s common stock (the “Holdback Shares”) are payable after the Closing to the stockholders
of Ittella Parent if, within the first three years after the Closing, the following conditions are satisfied: (i) if the trading
price of Forum’s common stock equals or exceeds $12.00 on any 20 trading days in any 30-day trading period (the “$12.00
Share Price Trigger”), then 2,500,000 Holdback Shares will be released to the stockholders of Ittella Parent, (ii) if
the trading price of Forum’s common stock equals or exceeds $14.00 on any 20 trading days in any 30-day trading period (each
of such $14.00 trigger and the $12.00 Share Price Trigger, a “Share Price Trigger”), then 2,500,000 Holdback
Shares will be released to the stockholders of Ittella Parent, and (iii) if a change in control occurs, all Holdback Shares not
previously released will be released to the stockholders of Ittella Parent. If the conditions to release of the Holdback Shares
are not satisfied within the first three years of Closing, the Holdback Shares are forfeited.
Forum Investors II
LLC, a Delaware limited liability company and the sponsor of Forum (the “Sponsor”), has agreed that at the Closing,
it will place 2,500,000 founder shares of Forum’s common stock held by it (the “Sponsor Earnout Shares”)
into escrow. The vesting, release and forfeiture terms of the Sponsor Earnout Shares are the same as the vesting, release and forefeiture
terms applicable to the Holdback Shares, with 50% of the Sponsor Earnout Shares vesting at each Share Price Trigger, and all Sponsor
Earnout Shares released if a change of control occurs, within the first three years after the Closing.
Representations, Warranties and Covenants
The Merger Agreement
contains customary representations, warranties and covenants by the parties thereto, including, among other things, covenants with
respect to the conduct of Forum and Ittella Parent during the period between execution of the Merger Agreement and the closing
of the Business Combination (the “Closing”).
Conditions to Closing
The Closing is subject
to certain conditions, including, among other things, (i) approval by Ittella Parent’s stockholders and the stockholders
of Forum of the Business Combination, (ii) approval of the listing of Forum’s common stock to be issued in connection with
the Business Combination, (iii) that Forum shall have cash available to pay at least $50 million of the Merger Consideration in
cash at the Closing, (iv) that Ittella Parent shall have delivered to Forum certain financial statements of Ittella Parent and
its subsidiaries, together with all related notes and schedules thereto, accompanied by a signed report of Ittella Parent’s
independent auditor with respect thereto, which report shall refer to the standards of the Public Company Accounting Oversight
Board and (v) as of a moment in time prior to the Closing, Forum shall not have indebtedness for borrowed money that exceeds $5,000,000.
Termination
The Merger Agreement
may be terminated prior to the Closing under certain circumstances, including, among others, (i) by written consent of Ittella
Parent and Forum, (ii) by written notice from either Forum or Ittella Parent, if the Closing has not occurred on or before September
30, 2020 (the “Termination Date”), unless the terminating party’s failure to comply with its obligations
under the Merger Agreement has resulted in the Closing not occurring on or before such date, (iii) by written notice from either
Forum or Ittella Parent, in the event that the other party breaches any of its representations, warranties, covenants or other
agreements under the Merger Agreement in a manner that would result in the failure of the conditions to Forum’s obligation
to consummate the Business Combination as of the Termination Date and such breach has not been cured within 30 days after receiving
notice, (iv) by written notice to Ittella Parent from Forum if at any time prior to the approval by Forum’s public stockholders,
the board of directors of Forum shall have effected a change in recommendation and (v) by written notice to Forum from Ittella
Parent if at any time prior to the approval by Forum’s public stockholders, if the board of directors of Forum shall have
effected a change in recommendation.
The foregoing description
of the Merger Agreement and the Business Combination does not purport to be complete and is qualified in its entirety by the terms
and conditions of the Merger Agreement, a copy of which is attached as Exhibit 2.1 hereto and is incorporated by reference herein.
The Merger Agreement contains representations, warranties and covenants that the respective parties made to each other as of the
date of such agreement or other specific dates. 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 Merger Agreement has been attached to provide investors with
information regarding its terms and is not intended to provide any other factual information about Forum, Ittella Parent or any
other party to the Merger Agreement. In particular, the representations, warranties, covenants and agreements contained in the
Merger Agreement, which were made only for purposes of such agreement and as of specific dates, were solely for the benefit of
the parties to the Merger Agreement, may be subject to limitations agreed upon by the contracting parties (including being qualified
by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Merger Agreement instead
of establishing these matters as facts) and may be subject to standards of materiality applicable to the contracting parties that
differ from those applicable to investors and reports and documents filed with the U.S. Securities and Exchange Commission (the
“SEC”). Investors should not rely on the representations, warranties, covenants and agreements, or any descriptions
thereof, as characterizations of the actual state of facts or condition of any party to the Merger Agreement. In addition, the
representations, warranties, covenants and agreements and other terms of the Merger Agreement may be subject to subsequent waiver
or modification. The representations and warranties made by the parties in the Merger Agreement will not survive the Closing. Moreover,
information concerning the subject matter of the representations and warranties and other terms may change after the date of the
Merger Agreement, which subsequent information may or may not be fully reflected in Forum’s public disclosures.
Restrictive Covenant Agreements
In connection with
the entry into the Merger Agreement, Forum entered into restrictive covenant agreements (collectively, the “Restrictive
Covenant Agreements”) with Salvatore Galletti, Sarah Galletti and certain other individuals (the “Restricted
Parties”). Pursuant to the terms of the Restrictive Covenant Agreements, the Restricted Parties have agreed to certain
non-compete, non-solicit and non-disparagement provisions. The foregoing description of the Restrictive Covenant Agreements does
not purport to be complete and is qualified in its entirety by the terms and conditions of the form of Restrictive Covenant Agreement,
a copy of which is filed as Exhibit 10.1 hereto and is incorporated by reference herein.
Employment Agreements
In connection
with the entry into the Merger Agreement, Forum entered into customary employment agreements or indicative terms of
employment with Salvatore Galletti, Sarah Galletti and certain other individuals, effective as of the Closing (collectively,
the “Employment Agreements”). Pursuant to the terms of the Employment Agreements, Salvatore Galletti,
Sarah Galletti and certain other individuals accepted employment with Forum. The foregoing description of the Employment
Agreements does not purport to be complete and is qualified in its entirety by the terms and conditions of the form of
Employment Agreement, a copy of which is filed as Exhibit 10.2 hereto and is incorporated by reference herein.
Sponsor Earnout Letter
In connection with
the entry into the Merger Agreement, Forum entered into the Sponsor Earnout Letter with the Sponsor and Ittella Parent (the “Sponsor
Earnout Letter”), pursuant to which the Sponsor agreed that effective upon the Closing, the Sponsor will place the Sponsor
Earnout Shares into escrow and subject such shares to the vesting conditions set forth in the Merger Agreement, as described above
under “Consideration and Sponsor Earnout Shares.” If such vesting conditions are not satisfied, then the Sponsor Earnout
Shares will be forfeited and cancelled. The foregoing description of the Sponsor Earnout Letter does not purport to be complete
and is qualified in its entirety by the terms and conditions of the Sponsor Earnout Letter, a copy of which is filed as Exhibit
10.3 hereto and is incorporated by reference herein.
Amended and Restated Registration
Rights Agreement
At the Closing,
Forum will enter into an amended and restated registration rights agreement (the “A&R RRA”) with Forum
Investors II LLC, Jefferies LLC, EarlyBirdCapital, Inc., UMB Capital Corporation, Salvatore Galletti, Pizzo Food, Srls and
Stephanie Dieckmann (collectively, the “Investors”), which, among other things, amends and restates the
registration rights agreement entered into by and among Forum, Forum’s initial directors and officers, the Sponsor,
Jefferies LLC and EarlyBirdCapital, Inc. at the time of Forum’s initial public offering. Pursuant to the terms of the
A&R RRA, among other things, Forum will be obligated to file, not later than 120 days after the Closing, a registration
statement covering the shares of common stock issued or issuable to the Investors.
In addition, Forum’s
initial investors will agree that they will not transfer (i) 1,250,000 shares of Forum’s Class B common stock (or shares
of common stock issuable in conversion thereof) (the “Founder Shares”) held by them prior to six months after
the Closing and (ii) 1,250,000 Founder Shares held by them prior to the earlier of (x) twelve months after the Closing, (y) the
date on which the last sales price of Forum’s common stock exceeds $12.00, subject to adjustment as provided therein and
(z) the date on which Forum completes a transaction that results in all of Forum’s stockholders having the right to exchange
their shares of common stock for cash, securities or other property. In addition, the holders of shares of Forum’s common
stock received as consideration in the Business Combination will agree not to transfer any of such shares held by them prior to
six months after the Closing.
The foregoing description
of the A&R RRA does not purport to be complete and is qualified in its entirety by the terms and conditions of the A&R
RRA, a copy of which is filed as Exhibit 10.4 hereto and is incorporated by reference herein.