Item 1.01 Entry into a Material Definitive Agreement.
General
On April 6, 2021, CA Healthcare
Acquisition Corp., a Delaware corporation (“CAH”), LumiraDx Limited, an exempted company with limited liability incorporated
under the laws of the Cayman Islands (“LumiraDx”) and LumiraDx Merger Sub, Inc., a newly formed Delaware corporation and wholly
owned subsidiary of LumiraDx (“Merger Sub”) entered into an Agreement and Plan of Merger (the “Merger Agreement”)
that, among other things, provides for Merger Sub to be merged with and into CAH with CAH being the surviving corporation in the merger
(the “Merger”). As a result of and upon consummation of the Merger, CAH will become a wholly owned subsidiary of LumiraDx,
with security holders of CAH becoming security holders of LumiraDx. The terms of the Merger Agreement, which contains customary representations
and warranties, covenants, closing conditions, termination provisions and other terms relating to the Merger and the other transactions
contemplated thereby, are summarized below.
Pre-Merger Transactions
Immediately prior to the effective
time of the Merger (the “Effective Time”),
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LumiraDx will effect certain capital restructuring transactions, including: (i) the conversion of each
series A preferred share of LumiraDx into A ordinary shares of LumiraDx; (ii) the conversion of each series B preferred share of LumiraDx
into common shares of LumiraDx; (iii) the conversion of each convertible loan note of LumiraDx into common shares of LumiraDx; and (iv)
effecting a subdivision of each A ordinary share of LumiraDx and each common share of LumiraDx into a number of A ordinary shares of LumiraDx
and common shares of LumiraDx (as applicable) calculated in accordance with the terms of the Merger Agreement (the “subdivision”),
such that the equity value per share (either A ordinary share or common share) on a fully diluted basis is $10 per share, based on a valuation
of LumiraDx of $5 billion (which such valuation may be increased for shares issued for cash in equity financing transactions prior to
the Effective Time);
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each issued and outstanding share of Class B common stock of CAH will be automatically converted into
one share of Class A common stock of CAH in accordance with the terms of the amended and restated certificate of incorporation of CAH;
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each one share of common stock of CAH and one half of a public warrant comprising each issued and outstanding
CAH unit immediately prior to the Effective Time will be automatically separated.
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The Merger
On the terms and subject to
the conditions set forth in the Merger Agreement and in accordance with the Delaware General Corporation Law (“DGCL”), on
the closing date, Merger Sub will merge with and into CAH. Following the Effective Time, the separate existence of Merger Sub will cease
and CAH will continue as the surviving entity of the Merger and will succeed to and assume all the rights and obligations of Merger Sub
in accordance with the DGCL. The closing of Merger (the “Closing”) will occur as promptly as practicable, but in no event
later than three business days, after the satisfaction or, if permissible, waiver of the conditions to the completion of the Merger set
forth in the Merger Agreement.
Conversion of Securities in the Merger
At the Effective Time, each
share of common stock of CAH issued and outstanding as of immediately prior to the Effective Time will be automatically canceled and extinguished
and reissued to LumiraDx as one share of common stock of the surviving corporation, in consideration for the right to receive one common
share of LumiraDx. After the Effective Time, the outstanding warrants of CAH shall, by their terms, automatically entitle the holders
to purchase LumiraDx common shares.
Representations, Warranties and Covenants
The Merger Agreement contains
representations and warranties made by LumiraDx and Merger Sub to CAH relating to a number of matters, including the following: organization
and qualification; subsidiaries; organizational documents; capitalization; authority relative to the Merger Agreement; no conflict; required
filings and consents; permits; compliance; financial statements and records; absence of certain changes or events; inventory; health care
matters; other regulatory compliance; export control laws; absence of litigation; products liability; employee benefit plans; labor and
employment matters; real property; title to assets; intellectual property; manufacturing, marketing and development rights; proprietary
information agreements; data privacy and security; taxes; environmental matters; material contracts; customers and suppliers; insurance;
board approval; vote required; certain business practices; international trade laws; interested party transactions; and no brokers.
The Merger Agreement contains
representations and warranties made by CAH to LumiraDx and Merger Sub relating to a number of matters, including the following: corporate
organization; governing documents; capitalization; authority relative to the Merger Agreement; no conflict; required filings and consents;
compliance; Securities and Exchange Commission (“SEC”) filings; financial statements; Sarbanes-Oxley; absence of certain changes
or events; absence of litigation; board approval; vote required; brokers; CAH trust fund; employees; taxes; brokers; registration and
listing; business activities; affiliate transactions; status under the Investment Company Act of 1940, as amended, and the Jumpstart Our
Business Startups Act of 2012; and due diligence investigations.
Conduct of Business Pending the Merger
LumiraDx
and CAH have agreed to customary covenants of the parties with respect to business operations prior to consummation of the Merger and
efforts to satisfy conditions to the consummation of the Merger. The Merger Agreement also contains additional covenants of the parties,
including, among others, covenants providing for CAH and LumiraDx to cooperate in the preparation of the Registration Statement on Form
F-4 of LumiraDx and proxy statement of CAH required to be prepared in connection with the Merger (the “Registration Statement”).
Conditions to Closing
Consummation of the Merger
is subject to customary conditions of the respective parties, and conditions customary to special purpose acquisition companies, including
(a) receipt of shareholder approval from the shareholders of CAH and receipt of shareholder, convertible loan note holder and warrantholder
approval from each of the shareholders of LumiraDx, the holders of convertible loan notes of LumiraDx and the holders of certain warrants
of LumiraDx (as applicable), in each case for the consummation of the Merger, (b) the absence of any law or governmental order preventing
the consummation of the Merger, (c) the effectiveness of the Registration Statement, (d) the approval for listing of the common shares
and warrants of LumiraDx to be issued in connection with the Closing on Nasdaq, subject only to official notice of issuance, and (e) CAH
will have at least $5,000,001 of net tangible assets following the exercise of redemption rights in accordance with CAH’s organizational
documents. In addition, LumiraDx also has the right to not consummate the Merger in the event that, as of the Effective Time, after giving
effect to the exercise of redemption rights by any CAH stockholders, funds in the CAH trust account do not equal at least $65,000,000
prior to payment of any unpaid or contingent liabilities, deferred underwriting fees or transaction costs of any of the parties.
Termination
The Merger Agreement may be
terminated under certain customary and limited circumstances at any time prior to the Closing, including by mutual written consent or
if the Merger has not been consummated on or prior to September 30, 2021.
A copy of the Merger Agreement
is filed with this Current Report on Form 8-K as Exhibit 2.1 and is incorporated herein by reference. The foregoing description of the
Merger Agreement and the Merger is not complete and is subject to, and qualified in its entirety by, reference to the actual agreement.
The Merger Agreement contains representations, warranties and covenants that the respective parties made to each other as of the date
of the Merger 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 Merger 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 Merger 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 Merger Agreement are not necessarily characterizations of the actual state of facts
about CAH, LumiraDx or the other parties at the time they were made or otherwise and should only be read in conjunction with the other
information that CAH makes publicly available in reports, statements and other documents filed with the SEC.
Exclusivity
LumiraDx and CAH have agreed to exclusivity covenants until the earlier
of Closing or termination of the Merger Agreement. LumiraDx agrees not to undergo an initial public offering and not to negotiate,
solicit or provide any information to any special purpose acquisition company other than CAH. CAH agrees not to directly or indirectly
enter into any proposal or commitment related to an alternative business combination that is anticipated to be announced on or prior to
the earlier of Closing or termination of the Merger Agreement.
Related Agreements
Sponsor Agreement
In connection with the Merger
Agreement, CAH, the CAH sponsor and certain existing stockholders of CAH (the “CAH Initial Stockholders”) entered into a letter
agreement (the “Sponsor Agreement”), pursuant to which, among other things, (i) the CAH sponsor and each CAH Initial Stockholder
agreed to vote to adopt the Merger Agreement and approve the Merger, and to vote against any proposal in opposition to approval of the
Merger Agreement or inconsistent with the Merger Agreement, (ii) the CAH sponsor and each CAH Initial Stockholder agreed not to transfer
any equity securities of CAH prior to the consummation of the Merger, and thereafter in accordance with an agreed lock-up period, (iii)
the CAH sponsor agreed to exchange the 4,050,000 CAH private placement warrants issued to it at the time of the CAH IPO for 405,000 common
shares of LumiraDx, and (iv) in the event that a certain percentage of the CAH public shares are redeemed, the CAH sponsor agreed
to forfeit a corresponding percentage of the CAH founder shares that would have otherwise converted into common shares of LumiraDx.
A copy of the form of Sponsor Agreement is filed
with this Current Report on Form 8-K as Exhibit 4.1 and is incorporated herein by reference, and may include such changes as are negotiated
between the parties thereto. The foregoing description of the Sponsor Agreement is not complete and is subject to, and qualified in its
entirety by, reference to the form thereof filed herewith.
LumiraDx Securityholder Support Agreement
In connection with the Merger
Agreement, LumiraDx and certain security holders of LumiraDx (the “Relevant Holders”) entered into an agreement, pursuant
to which, among other things, the Relevant Holders agreed (i) to vote in favor of the LumiraDx proposals at the relevant meetings to be
convened by LumiraDx in order to seek the LumiraDx approvals, and to vote against any competing business combination proposal and any
other proposal that would reasonably be expected to impede, frustrate or delay the Merger, and (ii) not to transfer, other than to affiliates
or other Relevant Holders, any of such Relevant Holder’s securities prior to the consummation of the Merger or termination of the
Merger Agreement in accordance with its terms.
Registration Rights Agreement
Upon consummation of the Merger,
LumiraDx, CAH, the CAH sponsor, and certain existing equityholders of LumiraDx will enter into an amended and restated registration rights
agreement, or the Registration Rights Agreement. Pursuant to the Registration Rights Agreement, holders of registrable securities of LumiraDx,
including the CAH sponsor, will be entitled to registration rights. The holders of these securities are entitled to make up to three demands,
excluding short form demands, that LumiraDx register such securities. In addition, the holders have certain “piggy-back” registration
rights with respect to registration statements filed subsequent to the consummation of the Merger. The Registration Rights Agreement also
provides that the Company will pay certain expenses related to such registrations and indemnify securityholders against certain liabilities.
The rights granted under the Registration Rights Agreement supersede any prior registration, qualification, or similar rights of the parties
with respect to LumiraDx or CAH securities, and all such prior agreements shall be terminated.