Item 1.01. Entry into a Material Definitive Agreement
Forward Share Purchase Agreement
On July 18, 2022, ArcLight Clean Transition Corp. II ("ArcLight") entered into a
forward share purchase agreement (the "Purchase Agreement") with Meteora Capital
Partners and its affiliates (collectively, "Meteora") pursuant to which,
provided that so long as Meteora will have acquired from redeeming shareholders
of ArcLight at least 1,900,000 ArcLight Class A ordinary shares as of the
closing of ArcLight's previously announced business combination (the "Business
Combination") with Opal Fuels LLC, a Delaware limited liability company ("OPAL
Fuels"), and has not redeemed any of such ArcLight Class A ordinary shares, in
connection with the Business Combination, then Meteora may elect to sell and
transfer to the combined company following the Business Combination (the
"Combined Company"), and the Combined Company will purchase from Meteora, on the
six month anniversary of the closing of the Business Combination, up to
2,000,000 shares of Class A common stock of the Combined Company (the "Share
Repurchase") held by Meteora at the time of closing of the Business Combination
(the "Meteora Shares"). Unless otherwise defined herein, capitalized terms used
herein shall have the meanings ascribed thereto in the Purchase Agreement.
The price at which Meteora has the right to sell the Meteora Shares to the
Combined Company is $10.02 per share. Meteora will notify the Combined Company
in writing not less than five (5) business days prior to the closing date of the
Share Repurchase (the "Put Date"), specifying the number of Meteora Shares that
the Combined Company will be required to purchase.
Pursuant to the Purchase Agreement, Meteora is also permitted at its election to
sell any or all of the Meteora Shares in the open market commencing after the
closing of the Business Combination, so long as the sale price exceeds $10.02
per share prior to the payment of any commissions due by Meteora for such sale.
Pursuant to an escrow agreement (the "Escrow Agreement"), to be entered into by
and among ArcLight, Continental Stock Transfer and Trust Co. ("Continental") and
Meteora, to secure its purchase obligation to Meteora, at the closing of the
Business Combination, ArcLight will place into escrow with Continental an
aggregate amount of up to $20,040,000 (the "Escrow Amount"). If and when Meteora
sells the Meteora Shares to any third party, an amount equal to the Combined
Company's purchase price obligation for that portion of such Meteora Shares,
which Meteora sells in the open market, will be released from escrow to the
Combined Company.
In exchange for ArcLight's commitment to purchase the Meteora Shares on the Put
Date, Meteora agrees to continue to hold, and not to redeem, the Meteora Shares
prior to the closing date of the Business Combination. In consideration for
Meteora's entry into the Purchase Agreement and the transactions and covenants
therein, ArcLight shall, at its option, (i) issue to Meteora 112,500 shares of
Class A common stock of the Combined Company or (ii) pay to Meteora a cash
payment in the amount of $600,000 upon consummation of the Business Combination.
The Purchase Agreement contains customary representations, warranties and
covenants from the parties thereto.
The foregoing description is only a summary of the Purchase Agreement and is
qualified in its entirety by reference to the full text of the Purchase
Agreement, which is filed as Exhibit 10.1 hereto and is incorporated by
reference herein.
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Important Information and Where to Find It
In connection with the Business Combination, ArcLight has filed with the SEC a
Registration Statement on Form S-4 (as amended, the "Registration Statement"),
which includes the related proxy statement/prospectus of ArcLight with respect
to the shareholders' meeting (the "Proxy Statement"). The Registration Statement
was declared effective by the SEC on June 27, 2022. This document does not
contain all the information that should be considered concerning the Business
Combination and is not intended to form the basis of any investment decision or
any other decision in respect of the Business Combination.
INVESTORS AND SECURITY HOLDERS AND OTHER INTERESTED PARTIES ARE URGED TO READ
THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS THAT HAVE BEEN FILED OR
WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE
DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN IMPORTANT
INFORMATION ABOUT ARCLIGHT, OPAL FUELS, THE BUSINESS COMBINATION AND RELATED
MATTERS.
Shareholders will also be able to obtain copies of the Registration Statement,
without charge, at the SEC's website at www.sec.gov. In addition, the documents
filed by ArcLight may be obtained free of charge from ArcLight at
https://www.arclightclean.com or by directing a request to: ArcLight Clean
Transition Corp. II, 200 Clarendon Street, 55th Floor, Boston, MA 02116.
Forward-Looking Statements
Certain statements in this communication may be considered forward-looking
statements. Forward-looking statements are statements that are not historical
facts and generally relate to future events or ArcLight's or OPAL Fuels' future
financial or other performance metrics. In some cases, you can identify
forward-looking statements by terminology such as "believe," "may," "will,"
"potentially," "estimate," "continue," "anticipate," "intend," "could," "would,"
"project," "target," "plan," "expect," or the negatives of these terms or
variations of them or similar terminology. Such forward-looking statement are
subject to risks and uncertainties, which could cause actual results to differ
materially from those expressed or implied by such forward looking statements.
New risks and uncertainties may emerge from time to time, and it is not possible
to predict all risks and uncertainties. These forward-looking statements are
based upon estimates and assumptions that, while considered reasonable by
ArcLight and its management, and OPAL Fuels and its management, as the case may
be, are inherently uncertain and subject to material change. Factors that may
cause actual results to differ materially from current expectations include, but
are not limited to, various factors beyond management's control, including
general economic conditions and other risks, uncertainties and factors set forth
in the section entitled "Risk Factors" and "Cautionary Statement Regarding
Forward-Looking Statements" in the Registration Statement and other filings with
the SEC, as well as (1) factors associated with companies, such as OPAL Fuels,
that are engaged in the production and integration of renewable natural gas
(RNG), including anticipated trends, growth rates, and challenges in those
businesses and in the markets in which they operate; (2) macroeconomic
conditions related to the global COVID-19 pandemic; (3) the effects of increased
competition; (4) contractual arrangements with, and the cooperation of, landfill
and livestock waste site owners and operators, on which OPAL Fuels operates its
landfill gas and livestock waste projects that generate electricity and RNG
prices for environmental attributes, low carbon fuel standard credits and other
incentives; (5) the ability to identify, acquire, develop and operate renewable
projects and RNG fueling stations; (6) delays in obtaining, adverse conditions
contained in, or the inability to obtain necessary regulatory approvals or
complete regulatory reviews required to complete the proposed transaction; (7)
the outcome of any legal proceedings that may be instituted in connection with
the proposed transaction; and (8) the ability of the combined company that
results from the proposed transaction to issue equity or equity-linked
securities or obtain debt financing in connection with the transaction or in the
future. Nothing in this communication should be regarded as a representation by
any person that the forward-looking statements set forth herein will be achieved
or that any of the contemplated results of such forward-looking statements will
be achieved. You should not place undue reliance on forward-looking statements
in this communication, which speak only as of the date they are made and are
qualified in their entirety by reference to the cautionary statements herein.
Both ArcLight and OPAL Fuels expressly disclaim any obligations or undertaking
to release publicly any updates or revisions to any forward-looking statements
contained herein to reflect any change in ArcLight's or OPAL Fuels' expectations
with respect thereto or any change in events, conditions or circumstances on
which any statement is based.
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Disclaimer
This communication is for informational purposes only and is neither an offer to
purchase, nor a solicitation of an offer to sell, subscribe for or buy, any
securities or the solicitation of any vote in any jurisdiction pursuant to the
Business Combination or otherwise, nor shall there be any sale, issuance or
transfer or securities in any jurisdiction in contravention of applicable law.
No offer of securities shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as amended.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
10.1 Forward Purchase Agreement, dated July 18, 2022, among ArcLight Clean
Transition Corp. II, Meteora Special Opportunity Fund I, LP, Meteora
Select Trading Opportunities Master, LP and Meteora Capital Partners, LP
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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