Item 1.01 Entry Into A Material Definitive
Agreement.
Business Combination Agreement
On February 2, 2021, Dragoneer Growth Opportunities Corp., a
Cayman Islands exempted company (“Dragoneer”), 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 Dragoneer,
Chariot Opportunity Merger Sub, Inc., a Delaware corporation
(“Chariot Merger Sub”), and Cypress Holdings, Inc., a
Delaware corporation (“CCC”).
The Business Combination Agreement and the transactions
contemplated thereby were approved by the boards of directors of
each of Dragoneer and CCC.
The Business Combination
The Business Combination Agreement provides for, among other
things, the following transactions on the closing date:
(i) Dragoneer will become a Delaware corporation (the
“Domestication”) and, in connection with the Domestication,
(A) Dragoneer’s name will be changed as determined by CCC in
its sole discretion, (B) each outstanding Class A ordinary
share of Dragoneer and each outstanding Class B ordinary share
of Dragoneer will become one share of common stock of Dragoneer
(the “Dragoneer Common Stock”), and (C) each
outstanding warrant of Dragoneer will become one warrant to
purchase one share of Dragoneer Common Stock; and
(ii) following the Domestication, Chariot Merger Sub will
merge with and into CCC, with CCC as the surviving company in the
merger and, after giving effect to such merger, continuing as a
wholly owned subsidiary of Dragoneer (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
Dragoneer’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, all outstanding shares, together
with all outstanding equity awards, of CCC will be exchanged for
shares of Dragoneer Common Stock or comparable equity awards that
are settled or are exercisable for shares of Dragoneer Common
Stock, as applicable, based on an implied CCC equity value of
$5,740,750,000, subject to adjustment in accordance with the
Business Combination Agreement. Additionally, the current CCC
equityholders and Dragoneer Growth Opportunities Holdings, a Cayman
Islands exempted limited company (“Sponsor”), each have an
earn out tied to the trading price of shares of the combined
company after the closing of the Merger.
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. Dragoneer has also agreed
to take all action within its power as may be necessary or
appropriate such that, effective immediately after the closing of
the Business Combination, the Dragoneer board of directors shall
consist of nine directors, who shall be divided into three classes,
which directors shall include six individuals (at least three of
whom must qualify as independent under NYSE rules) designated by
Advent (as defined in the Business Combination Agreement), and two
individuals designated by certain other parties to the Amended and
Restated Registration and Shareholder Rights Agreement (as defined
below). In addition, Dragoneer has agreed to adopt an equity
incentive plan, as described in the Business Combination
Agreement.
Conditions to Each Party’s Obligations
The obligation of Dragoneer and CCC 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 approval of
Dragoneer’s shareholders, (iii) the approval of CCC’s
shareholders and (iv) Dragoneer 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.