Item 1.01 Entry into a Material Definitive Agreement.
Business Combination Agreement
On March 29, 2021, Ajax I, a Cayman Islands
exempted company (“AJAX”), entered into a business combination agreement (the “Business Combination
Agreement”) with Cazoo Holdings Limited, a private limited company formed under the laws of England and Wales (the “Company”),
and Capri Listco, a Cayman Islands exempted company (“Listco”). The transactions contemplated by the Business
Combination Agreement are referred to herein as the “Business Combination.” The boards of directors of AJAX
and a committee of the board of directors of the Company unanimously approved the Business Combination.
The Business Combination Agreement provides, subject
to the terms and conditions therein, for the consummation of, among other things, the following transactions prior to the closing of the
Business Combination (collectively, the “Reorganization”): (a) approximately three business days prior to the closing
of the Business Combination (the “Listco Closing Date”), the sole shareholder of Listco will transfer to AJAX all of
the issued and outstanding equity securities of Listco and, as a result of such transfer, Listco shall become a wholly-owned subsidiary
of AJAX, and (b) following the Listco Closing Date, AJAX will be merged with and into Listco, with Listco continuing as the surviving
entity (the “Merger”). In connection with the Merger, each AJAX unit (consisting of one Class A ordinary share and
one-fourth of one redeemable warrant), Class A ordinary share, Class B ordinary share and warrant issued and outstanding immediately prior
to the Merger will be cancelled in exchange for the right to receive one Listco unit (consisting of one Listco Class A Share and one-fourth
of one redeemable Listco warrant), Class A ordinary share, par value $0.0001 per share, Class B ordinary share, par value $0.0001 per
share, and warrant to purchase Listco Class A ordinary shares, respectively (such securities the “Listco Units,” “Listco
Class A Shares,” “Listco Class B Shares,” and “Listco Warrants,” respectively).
Approximately two days following the completion
of the Reorganization and at the closing of the Business Combination (the “Closing”), pursuant to the Business
Combination Agreement, subject to the terms and conditions therein, Listco will acquire all of the issued and outstanding shares
of the Company (the “Company Shares”) from the holders thereof (the “Company Shareholders”).
The aggregate consideration to be paid to the Company Shareholders for the purchase of the Company Shares will be (a) an amount
in cash equal to the Aggregate Cash Consideration (as defined below), and (b) a number of Listco Class C ordinary shares, par value
$0.0001 per share (the “Listco Class C Shares”), with a value equal to the Aggregate Stock Consideration (as
defined below). Company Shareholders will, subject to the procedures, limitations and rationing mechanics set forth in the Business
Combination Agreement, have the ability to elect the mix of cash and Listco Class C Shares each such Company Shareholder will receive.
The Listco Class C Shares will, subject to certain exceptions, be non-transferrable for 180 days following the Closing, at which
time, such Listco Class C Shares will automatically convert into Listco Class A Shares in accordance with Listco’s governing
documents. Additionally, effective as of the Closing, (a) the issued and outstanding Listco Class B Shares will convert automatically
on a one-for-one basis into Listco Class A Shares, and (b) each issued and outstanding Listco Unit will automatically separate
into its component parts.
The Aggregate Cash Consideration will be
the portion of the Aggregate Transaction Proceeds (where the Aggregate Transaction Proceeds means the cash in AJAX’s trust
account (after giving effect to any shareholder redemptions) plus the aggregate proceeds received by Listco from the PIPE
Investors (as defined below)) that are allocated to the Company and the Company Shareholders in accordance with the distribution
and allocation waterfall as more specifically set forth in the Business Combination Agreement. The Aggregate Stock Consideration
will consist of a number of Listco Class C Shares equal to (A) $7,000,000,000, minus (B) the value of the AJAX Class B ordinary
shares (valued at $10.00 per share) plus or minus (C) the amount by which the Company’s net cash exceeds or
is less than £0, minus (D) an amount equal to the value of all of the Rollover Options (as defined below) (based upon
the per share value of a Company Share at Closing), minus (E) any unpaid transaction expenses of AJAX and the Company as
of immediately prior to Closing , minus (F) the Aggregate Cash Consideration, and dividing such number by $10.00. All amounts
to be calculated with respect to the consideration paid for the Company Shares (and any component or subcomponent thereof that
is expressed as a currency) will be determined using US Dollars, and any non-US Dollar denominated amounts will be converted from
the applicable foreign currency at the applicable exchange rate that will be fixed four business days prior to Closing.
In addition, prior to the Closing the Company
will accelerate the vesting in full of certain unvested options (the “Company Options”), subject to the holders
of such Company Options having executed and delivered to the Company an undertaking agreeing to certain forfeiture provisions.
Additionally, the holders of certain other Company Options will have the ability to make an election to receive a cash payment
in exchange for the cancellation of a corresponding number of Company Options, which election will be subject to the same limitations
and rationing mechanics, as noted in the above paragraphs. Any Company Options (whether vested or unvested) that are not exercised
or are not cancelled in exchange for a cash payment at the Closing, will be cancelled and replaced by an option to purchase an
equivalent value of Listco Class C Shares (each, a “Rollover Option”). Except as agreed in writing with the
holder thereof, Rollover Options will be subject to the terms and conditions of the incentive equity plan to be adopted by the
board of directors AJAX prior to the initial filing of the Registration Statement (as described below) (the “Listco Incentive
Equity Plan”) but will be granted on the same terms as the Company Options were subject prior to the Closing under the
applicable Company equity plan.
Representations and Warranties
The Business Combination Agreement contains customary
representations and warranties of the Company, relating to the Company and its subsidiaries, as well as AJAX and Listco, none of which
will survive the Closing.
Covenants
The Business Combination Agreement includes
customary covenants of the parties with respect to business operations prior to consummation of the Business Combination and efforts
to satisfy conditions to the consummation of the Business Combination. The Business Combination Agreement also contains additional
covenants of the parties, including, among others, covenants providing for AJAX, Listco and the Company to cooperate in the preparation
and filing of the Registration Statement on Form F-4 relating to the registration of the Listco Class A Shares (including those
issuable upon conversion of the Listco Class C Shares) issued in the Business Combination (the “Registration Statement”)
and for the Company to use reasonable best efforts to obtain consents and/or waivers with respect to certain of the Company’s
commercial contracts and to deliver financial statements in accordance with the standards of PCAOB. Additionally, following the
effectiveness of the Registration Statement, the Company is required to use reasonable best efforts to implement and make effective
a drag-along sale as contemplated by the Company’s articles of association to implement the sale of the Company Shares to
Listco. The covenants made under the Business Combination Agreement will not survive the Closing, unless by their terms they are
to be performed in whole or in part after the Closing.
Conditions to Closing
The consummation of the transactions contemplated
by the Business Combination Agreement is conditioned upon, among other things: (a) no order, judgement, injunction or law being
issued by any court prohibiting the consummation of the Business Combination; (b) the Registration Statement shall have become
effective; (c) a drag along notice (the “Drag Along Notice”) shall have been delivered to Company Shareholders
pursuant to the relevant provisions of the Company’s articles of association; (d) AJAX’s shareholders shall have approved
the Business Combination; (e) consent from the UK Financial Conduct Authority shall have been obtained; (f) the Listco Class A
Shares (including the Listco Class A Shares to be issued upon conversion of the Listco Class C Shares and the Listco Class A Shares
to be issued pursuant to the Business Combination Agreement and the Subscription Agreements) shall have been approved for listing
on the New York Stock Exchange, subject to official notice of the issuance thereof; and (g) the Aggregate Transaction Proceeds
shall be equal to or greater than $1,000,000,000.
The obligations of the parties are also conditioned
upon, among other things: (a) the accuracy of the representations and warranties of the other party (subject to certain bring-down standards);
(b) the performance in all material respects of the covenants of the other party; and (c) no material adverse effect with respect to any
of the parties shall have occurred between the date of the Business Combination Agreement and the Closing.
Termination
The Business Combination Agreement may be terminated:
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by mutual written consent of AJAX and the Company;
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by AJAX or the Company, if the other party has breached any of its representations and warranties or failed
to perform any of its covenants or agreements, in each case, such that certain conditions to Closing would not be satisfied and the breach
of such representations, warranties, covenants or agreements, as applicable, is (or are) not cured or cannot be cured within the earlier
of (i) 45 days after written notice thereof is delivered to the breaching party, and (ii) the Termination Date (as defined below),
provided that no party may exercise its right to terminate the Business Combination Agreement if such party is then in breach of the Business
Combination Agreement so as to prevent certain conditions to Closing from being satisfied;
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by either AJAX or the Company if the Business Combination is not consummated on or before October 29, 2021 (the “Termination Date”), provided that the right to terminate the Business Combination Agreement will not be available to any party whose breach of any of its covenants or obligations under the Business Combination Agreement has primarily caused the failure of the Business Combination to occur on or before the Termination Date;
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by either AJAX or the Company if a governmental entity shall have issued an order, decree, judgment or
ruling or taken any other action, in any case having the effect of permanently restraining, enjoining or otherwise prohibiting the Business
Combination, which order, decree, judgment, ruling or other action is final and non-appealable;
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by either AJAX or the Company if AJAX shareholder approval has not been obtained; or
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by AJAX if the Company does not deliver, or cause to be delivered, to the applicable Company
Shareholders the Drag Along Notice within five business days of the effectiveness of the Registration Statement.
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The foregoing summary of the Business Combination
Agreement is qualified in its entirety by reference to the text of the Business Combination Agreement, which is attached as Exhibit 2.1
hereto and incorporated herein by reference. The Business Combination Agreement contains representations, warranties and covenants that
the respective parties thereto made to each other as of the date of the Business Combination 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. In particular,
the assertions embodied in the representations and warranties in the Business Combination Agreement were made as of a specified date,
are modified or qualified by information in one or more confidential disclosure letters prepared in connection with the execution and
delivery of the Business Combination Agreement, may be subject to a contractual standard of materiality different from what might be viewed
as material to investors, or may have been used for the purpose of allocating risk between the parties. Accordingly, the representations
and warranties in the Business Combination Agreement are not necessarily characterizations of the actual state of facts about AJAX, Listco
or the Company at the time they were made or otherwise and should only be read in conjunction with the other information that AJAX or
Listco, as applicable, makes publicly available in reports, statements and other documents filed with the Securities and Exchange Commission
(“SEC”).
Sponsor Letter Agreement
Concurrently with the execution of the
Business Combination Agreement, AJAX I Holdings, LLC (the “Sponsor”) entered into a letter agreement (the “Sponsor
Letter Agreement”) with the Company and AJAX, pursuant to which the Sponsor has agreed to (i) vote all shares of AJAX
beneficially owned by it in favor of the Business Combination and each other proposal related to the Business Combination proposed
by the board of directors of AJAX at the meeting of AJAX shareholders called to approve the Business Combination, (ii) appear at
such shareholder meeting for the purpose of establishing a quorum, (iii) vote all such shares against any action that would reasonably
be expected to materially impede, interfere with, delay, postpone, or adversely affect the Business Combination or any of the other
transactions contemplated by the Business Combination Agreement, (iv) waive the anti-dilution protections set out in AJAX’s
articles of association with respect to each of its Class B ordinary shares, and (v) not to transfer, assign, or sell such shares,
except to certain permitted transferees, prior to the consummation of the Business Combination.
The foregoing summary of the Sponsor Letter Agreement
is qualified in its entirety by reference to the text of the Sponsor Letter Agreement, which is attached as Exhibit 10.1 hereto and incorporated
herein by reference.
Transaction Support Agreements
Concurrently with the execution of
the Business Combination Agreement, AJAX, Listco, the Company and holders of a majority of each of the Company’s
outstanding series A shares, series B shares, series C shares and ordinary shares have executed transaction support
agreements (the “Transaction Support Agreements”) pursuant to which, on the terms and subject to the
conditions set forth therein, each such holder agreed to, among other things (i) following the effectiveness of the
Registration Statement, enter into a purchase and sale agreement for his, her or its Company Shares pursuant to which, such
Company Shareholder will sell and Listco will purchase such Company Shareholder’s Company Shares, (ii) to the extent
reasonably determined to be necessary or advisable by AJAX or the Company in furtherance of the Business Combination, support
and vote in favor of the Business Combination Agreement, the ancillary documents to which the Company is or will be a party
and the transactions contemplated thereby, (iii) take, or cause to be taken, any actions reasonably determined by AJAX and
the Company to be necessary or advisable to exercise the drag along right set out in and in accordance with the
Company’s articles of association, and (iv) subject to certain exceptions, not to transfer, assign, or sell their
respective Company Shares, prior to the consummation of the Business
Combination.
The foregoing summary of the Transaction Support
Agreements is qualified in its entirety by reference to the text of the Transaction Support Agreements, the form of which is attached
as Exhibit 10.2 hereto and incorporated herein by reference.
Incentive Equity Plan
Prior to the initial filing of the Registration
Statement, AJAX will adopt the Listco Equity Incentive Plan, the form and terms of which will be agreed upon by the Company, AJAX
and Listco, reserving a number of Listco Class A Shares for grant thereunder equal to 5% of the fully diluted issued and outstanding
Listco Class A Shares (on an as-converted basis taking into account the future conversion of the Listco Class C Shares) immediately
after the Closing plus any Listco Class A Shares under options rolled over from the Company’s existing equity incentive plan,
which subsequently lapse, are forfeited or cancelled in accordance with their terms.
Investor Rights Agreement
At the Closing, Listco, the Sponsor and certain
securityholders of Listco will enter into an investor rights agreement (the “Investor Rights Agreement”), pursuant
to which, among other things, certain shareholders (a) will be granted certain registration rights with respect to their respective Listco
equity securities, and (b) will be entitled to nominate individuals to the board of directors of Listco following the Closing, in each
case, on the terms and subject to the conditions set forth therein. In particular, Listco and such securityholders will agree to take
all necessary and desirable actions such that the following individuals will be elected to the Listco board:
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for so long as Alex Chesterman is the Chief Executive Officer of Listco or, together with his affiliates,
beneficially owns at least 5% of the issued and outstanding voting shares of Listco, Alex Chesterman;
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for so long as Stephen Morana is the Chief Financial Officer
of Listco, Stephen Morana;
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until the expiration of the term of office of Listco’s Class III directors in office on the Closing
Date, one individual designated by the Sponsor, who will initially be Daniel Och; and
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until the later of (i) the expiration of the term of office of Listco’s Class III directors in office
on the Closing Date and (ii) such time as DMGV Limited (“DMGV”), together with certain affiliates, no longer beneficially
owns 10% or more of the issued and outstanding voting shares of Listco, one individual designated by DMGV.
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Pursuant to the letter agreement signed
by the Sponsor at the time of the AJAX initial public offering, the Sponsor agreed not to transfer the Listco Class A Shares issued
to it upon conversion of the Ajax Class B ordinary shares during the period ending on the earlier of (i) two years after the Closing
Date and (ii) subsequent to the Closing Date, (x) if the last reported sale price of the Listco Class A Shares equals or exceeds
$12.00 per share for any 20 trading days within any 30-trading day period commencing at least 150 days after the Closing Date or
(y) the date on which Listco completes a liquidation, merger, share exchange, reorganization or other similar transaction that
results in all of Listco’s shareholders having the right to exchange their ordinary shares for cash, securities or other
property.
The foregoing summary of
the Investor Rights Agreement is qualified in its entirety by reference to the text of the Investor Rights Agreement, a form of
which is attached as Exhibit 10.3 hereto and incorporated herein by reference.