Holley Intermediate Holdings, Inc. entered into a term sheet agreement to acquire Empower Ltd. (NYSE:EMPW) from Empower Sponsor Holdings LLC and others in a reverse merger transaction for approximately $960 million on December 24, 2020. Holley Intermediate Holdings, Inc. entered into a merger agreement to acquire Empower Ltd. from Empower Sponsor Holdings LLC and others in a reverse merger transaction on March 11, 2021. Under the terms of the agreement, Holley shareholders will receive cash consideration in an amount of up to $387.5 million and at least $577.5 million of stock consideration, consisting of 57.75 million newly issued shares of domesticated company common stock. Upon the closing of the transaction, and assuming none of Empower's public stockholders elect to redeem their shares, existing Holley shareholders are expected to own 49.9% of the combined company, the Empower sponsors are expected to own 3.5% of the combined company, PIPE participants are expected to own 20.7% of the combined company, MidOcean Fund V is expected to own 4.3% of the combined company, and public stockholders are expected to own 21.6% of the combined company. Sentinel Capital Partners, which controls Holley will be the largest shareholder of the combined company if the transaction goes through. Transaction will be financed through $250 million of cash held in Empower's trust account, a $50 million forward purchase agreement from MidOcean Fund V, and a $240 million PIPE, which includes investments by Wells Capital Management, Inc. and Wasatch Global Investors. Upon the effectiveness of the business combination, Empower will change its name to “Holley”. Under the transaction, Holley will combine with Empower Ltd. to go public with Holley trading under the symbol “HLLY”.

Holley's President and Chief Executive Officer, Tom Tomlinson, and the current management team will continue to lead the combined company, while Matt Rubel is expected to serve as Chairman and James D. Coady, Tom Tomlinson, Owen M. Basham, Gina Bianchini, Ginger M. Jones and Michelle Gloeckler are expected to be members in the Board of Directors. The transaction is subject to customary conditions, including, among others approval of the stockholders of Empower; approval by the Holley stockholder; the waiting period applicable to the mergers under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, having expired (or early termination having been granted); the shares of the Domesticated Company Common Stock and Domesticated Company Public Warrants to be issued in connection with the transaction and closing shall have been approved for listing on NYSE; the receipt of certain regulatory approvals; and Empower having at least $5,000,001 in net tangible assets and approval of Holley Parent Holdings shall have been obtained. The Boards of Directors of each of Empower and Holley have unanimously approved the transaction. As of May 25, 2021, Holley's stockholders have approved the Merger Agreement and the consummation of the Business Combination. As of June 11, 2021, the waiting period under the HSR Act expired on April 26, 2021. As of June 24, 2021, the U.S. Securities and Exchange Commission (“SEC”) has declared effective its Registration Statement on Form S-4 (as amended, the “Registration Statement”). The transaction was approved by the shareholders of Empower Ltd. at its extraordinary general meeting of shareholders held on July 14, 2021. As of July 15, 2021, the transaction is expected to close on July 16, 2021. It is expected that the proceeds from the transaction will be used to invest in Holley's growth initiatives, substantially reduce existing debt, support marketing efforts, and provide additional working capital.

William Blair & Company, Jefferies LLC, and Lazard Middle Market are acting as financial advisors and William Gump and Claire James of Willkie Farr & Gallagher LLP is acting as legal advisor to Holley. J.P. Morgan Securities LLC and Jefferies LLC are acting as co-lead placement agents on the PIPE and J.P. Morgan Securities LLC is acting as capital markets advisor to Empower, and George Stamas, Andrew Herman and Evan D'Amico of Gibson, Dunn & Crutcher LLP is acting as legal advisor to Empower. Kirkland & Ellis is acting as legal counsel to J.P. Morgan Securities LLC and Jefferies LLC. Continental Stock Transfer & Trust Company acted as transfer agent to Empower. Morrow & Co., LLC acted as proxy solicitor to Empower. Empower will pay to Morrow Sodali LLC a fee of $32,500, plus disbursements.

Holley Intermediate Holdings, Inc. completed the acquisition of Empower Ltd. (NYSE:EMPW) from Empower Sponsor Holdings LLC and others in a reverse merger transaction on July 16, 2021. The combined company's share will start trading on the New York Stock Exchange on July 19, 2021.