TRTL TortoiseEcofin Acquisition Corp III

 

On February 14, 2024, the Company entered into an Amended and Restated Business Combination Agreement (as amended, the “Business Combination Agreement”) with One Energy, Pubco, TRTL III First Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of Pubco (“TRTL Merger Sub”), OEE Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of Pubco (“Company Merger Sub” and together with TRTL Merger Sub, the “Merger Subs”), which amends, restates and supersedes the Business Combination Agreement, dated August 14, 2023, entered into by the Company, One Energy, and TRTL III Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of the Company. It is proposed that, at the Closing of the Transactions, Pubco will change its name to “One Power Company.”

Pursuant to the Business Combination Agreement, subject to the terms and conditions set forth therein, (i) at least one day prior to the Closing of the Transactions, the Company will transfer by way of continuation out of the Cayman Islands and into the State of Delaware to re-domicile and become a Delaware corporation (the “Domestication”), (ii) following the Domestication, TRTL Merger Sub will merge with and into the Company, with the Company continuing as the surviving entity and a wholly-owned subsidiary of Pubco (the “TRTL Merger”), in connection with which all of the existing securities of the Company will be exchanged for rights to receive securities of Pubco as follows: (a) each share of TRTL common stock, par value $0.0001 per share, outstanding immediately prior to the effective time of the TRTL Merger shall automatically convert into one share of common stock, par value $0.0001 per share, issued by Pubco (“Pubco Common Shares”) and one contingent share right (“CSR”), entitling the holder to a contingent future right, subject to satisfaction of certain trading price-based conditions, to receive a portion of certain Pubco Common Shares otherwise deliverable at the Closing of the Transactions contemplated by the Business Combination Agreement to the founder and Chief Executive Officer of One Energy, as further described below (except with regard to holders of Class B ordinary shares of TRTL, par value $0.0001 per share, that have waived their rights to receive CSRs for their Class B ordinary shares or Class A ordinary shares of the Company, par value $0.0001 per share, issued upon conversion of their Class B ordinary shares) and (b) each warrant to purchase the Company’s Class A ordinary shares shall automatically convert into one warrant to purchase Pubco Common Shares on substantially the same terms and conditions; (iii) prior to the Company Merger, One Energy shall cause the holders of all of its issued and outstanding convertible instruments (other than the options to be assumed by Pubco in connection with the Business Combination) (“Company Convertible Securities”) to either exchange or convert all of their issued and outstanding Company Convertible Securities for shares of One Energy common stock (including any accrued or declared but unpaid dividends) at the applicable conversion ratio set forth in One Energy’s governing documents or the terms of the applicable instruments (the “Company Exchanges”); (iv) promptly following the Company Exchanges, Company Merger Sub will merge with and into One Energy, with One Energy continuing as the surviving entity and a wholly-owned subsidiary of Pubco (the “Company Merger”), pursuant to which, other than dissenting shares, if any, (a) all One Energy common stock issued and outstanding immediately prior to the effective time of the Company Merger (after giving effect to the Company Exchanges) will be cancelled and converted into the right to receive such number of Pubco Common Shares as shall be determined in accordance with an allocation schedule (the “Allocation Schedule”) to be delivered prior and as a condition to Closing pursuant to the terms of the Business Combination Agreement (all such shares, collectively, the “Aggregate Common Share Consideration”), and (b) all issued and outstanding shares of One Energy preferred stock, par value $0.0001 per share, if any such shares remain outstanding as of immediately prior to the effective time of the Company Merger (after giving effect to the Company Exchanges) will be canceled and converted into the right to receive one share of preferred stock of Pubco, par value $0.0001 per share, subject to the Allocation.

On April 19, 2024, the Company held the Second Extension Meeting at which shareholders approved an amendment to the Amended and Restated Memorandum and Articles of Association to extend the date by which the Company has to consummate an initial Business Combination from April 22, 2024 on a monthly basis up to six times until October 22, 2024 (or such earlier date as determined by the Board). The Sponsor agreed that it or its designee would deposit $310,396.26 per month into the Trust Account, for each calendar month (commencing on April 23, 2024 and on the 23rd day of each subsequent month) until October 22, 2024, or portion thereof, that is needed to complete an initial Business Combination. As a result, the date by which the Company must consummate its Business Combination was extended from April 22, 2024 to October 22, 2024. In connection with the Second Extension Meeting, shareholders holding 1,744,889 Public Shares exercised their right to redeem such shares for a pro rata portion of the funds in the Trust Account. As a result, approximately $18.9 million (approximately $10.85 per share) was removed from the Trust Account to pay such holders.

In connection with the Second Extension Meeting, to extend the date by which the Company must consummate an initial Business Combination from April 22, 2024, on a monthly basis, up to six times until October 22, 2024 (or such earlier date as determined by the Board), the Company entered into several agreements as further described herein.

 

Additionally, also in connection with the Second Extension Meeting and the Extension payments, including the Sponsor’s obligations in respect thereof, on April 25, 2024, the Company, the Sponsor, One Energy and a third-party investor (the “April 2024 Investor”) entered into a subscription agreement (the “April 2024 Subscription Agreement”). Pursuant to the April 2024 Subscription Agreement, the April 2024 Investor agreed to contribute $400,000 to the Sponsor as a capital contribution (the “April 2024 Capital Contribution”), which April 2024 Capital Contribution will generally be treated as part of the April 17, 2024 SPAC Loan and was loaned by the Sponsor to the Company for working capital expenses and extensions as described above. In consideration of such April 2024 Capital Contribution, the Subscription Agreement contemplates that the Investor will receive, upon consummation, if any, of the proposed Transactions, 200,000 shares (the “April 2024 Subscription Shares”) of Pubco. The April 2024 Subscription Shares will be issued within two business days after the Closing and will have certain registration rights described in the April 2024 Subscription Agreement. Under the terms of the April 2024 Subscription Agreement, following the Company’s repayment of the amount of the April 2024 Capital Contribution to the Sponsor, the Sponsor, in turn, shall pay an amount equal to the April 2024 Capital Contribution to the April 2024 Investor, within five business days of the Closing (the “Return of Capital”). In addition, within seven days of the Closing, Pubco will pay the Investor an additional cash payment in the aggregate amount of $200,000 (the “Cash Payment”).

In the event that the Company or the Sponsor defaults in its obligations regarding the Return of Capital or Cash Payment under the April 2024 Subscription Agreement for a period of 30 business days following written notice to Pubco, Pubco shall cause to be issued to the Investor 800,000 shares of One Energy common stock, with registration rights, within three business days after receipt of the written notice on default, subject to certain limits.

Furthermore, in the event the Transactions are completed and a mandatory trigger of One Energy’s Series A preferred stock occurs prior to the Closing under the terms of the Certificate of Incorporation of One Energy, the April 2024 Investor will have a option to cause Pubco to repurchase up to 600,000 shares of common stock owned by the April 2024 Investor as a result of private purchases of One Energy’ Series A shares prior to the Closing of the Transactions, at $10.00 per share, which option is exercisable within the first thirty trading days following the completion of the Transactions.

If the Transactions are not completed, the April 2024 Subscription Agreement provides that One Energy will issue to the April 2024 Investor the number of shares of One Energy common stock equal to the principal amount of its April 2024 Capital Contribution at a price that values One Energy at its most recent private company equity valuation. If One Energy’s shares of common stock are not listed on a national securities exchange by December 31, 2026, the April 2024 Investor will also have a option to cause One Energy to redeem all of the One Energy shares then-owned by the Investor that are a direct result from the April 2024 Subscription Agreement for an amount equal to the product of (x) 1.05 and (y) the April 2024 Capital Contribution.

On May 13, 2024, the Company, One Energy, Pubco and the Merger Subs entered into the First Amendment to the Business Combination Agreement (“Amendment No. 1”), which reflects the following changes and adjustments relative to the terms set forth in the Business Combination Agreement: (i) a reduction in the number of Pubco Common Shares issuable to the Sponsor, if any, upon the Closing of the proposed Transactions (the “Sponsor Earnout Shares”) that will, for a period after the Closing, be subject to certain contingent forfeiture terms from Pubco Common Shares to Pubco Common Shares, (ii) the receipt of additional loans contributed to the Company by the Sponsor and (iii) the removal from the Business Combination Agreement of the condition to the Closing that the Company, at the Closing, have at least $ of net tangible assets.

 

The “Revised Terms” are the provisions in the Amended and Restated Sponsor Letter Agreement which reflect that, subject to certain exceptions, the Sponsor and each Class B Holder have agreed not to transfer any of the 7,187,500 Class B ordinary shares purchased by the Sponsor in February 2021 until, in the context of the proposed Transactions, the earlier of (i) two years after the Closing Date, (ii) the first date after the Closing Date when the volume-weighted average share price of Pubco Common Shares as displayed on Pubco’s page on Bloomberg (or any successor service) in respect of the period from 9:30 a.m. to 4:00 p.m., New York City time, on the applicable trading day equals or exceeds $15.00 per share (as adjusted for share splits, reorganizations, recapitalizations and the like) for any 20 trading days within a trading period commencing at least 120 days after the Closing and (iii) the date after the Closing Date when Pubco consummates a liquidation, merger, share exchange or other similar transaction resulting in Pubco shareholders having the right to exchange shares of Pubco for other property.

In addition to the base consideration paid at the Closing, for the period of time commencing 90 days after the Closing and ending on of the Closing (“One Energy Earnout Period”), One Energy Stockholders will have the right to earn additional Pubco-Common Shares upon the following terms:

 

 

If, during the One Energy Earnout Period there is a change of control transaction in which Pubco or its stockholders have the right to receive consideration implying a value per share (as agreed in good faith by the Board) that is greater than or equal to the applicable VWAP prices specified above, any applicable earnout shares that have not previously been issued will be issued to the One Energy stockholders.

 

In connection with the execution of the Business Combination Agreement, the Sponsor entered into a sponsor letter agreement (as amended, the “Original Sponsor Letter Agreement”) with the Company and One Energy, pursuant to which the Sponsor and each of the Company shareholders party thereto agreed to (a) vote in favor of the Business Combination Agreement and the Transactions, (b) not transfer their shares of the Company during the period between the signing of the Business Combination Agreement and the Closing, (c) waive any adjustment to the conversion ratio set forth in the governing documents of the Company or any other anti-dilution or similar protection with respect to their shares of the Company, and (d) subject of their shares of the Company to potential vesting and forfeiture based on a stock price based earnout over at period, with an early release if the TRTL VWAP exceeds $ per share over out of any consecutive trading days, during such period after Closing.

Contemporaneously with the execution of Amendment No. 1, the Sponsor entered into an Amended and Restated Sponsor Letter Agreement, dated as of May 13, 2024 (the “Amended and Restated Sponsor Letter Agreement”) with Pubco, the Company, One Energy and certain holders of Class B ordinary shares of the Company (the “Class B Holders,” excluding qualified institutional buyers and institutional accredited investors who purchased Class B ordinary shares in connection with the Initial Public Offering), which amended, restated and replaced the Original Sponsor Letter Agreement. Pursuant to the Amended and Restated Sponsor Letter Agreement, (i) Pubco, which was not a party to the Original Sponsor Letter Agreement, became a party to the agreement and (ii) references to the Company’s Class A ordinary shares were replaced with references to Pubco Common Shares. Additionally, the Class B Holders agreed, together with the Company and Pubco, solely for the limited purposes of applicable provisions, that, effective as of the date of the Closing (the “Closing Date”), the original lock-up terms applicable to the Sponsor and each other relevant party under the terms of the letter agreement dated July 19, 2021, between the Company, the Sponsor and the other parties thereto entered into at the time of the Initial Public Offering would be extended to the Revised Lock-Up Terms (as defined above).

In connection with the execution of the Business Combination Agreement, Jereme Kent, CAS Ohio LLC and RES Ohio LLC (collectively, the “Supporting Company Stockholders”) entered into a stockholder support agreement (the “Original Stockholder Support Agreement”), pursuant to which, among other things, each such Supporting Company Stockholder agreed to, (a) support and vote in favor of the Business Combination Agreement and the ancillary documents to which One Energy is or will be a party and the Transactions, (b) not transfer their One Energy shares during the interim period prior to the Closing, and (c) take, or cause to be taken, any actions necessary or advisable to cause certain agreements to be terminated effective as of the Closing.

Contemporaneously with the execution of Amendment No. 1, the Company entered into an Amended and Restated Stockholder Support Agreement, dated as of May 13, 2024 (the “Amended and Restated Stockholder Support Agreement”) with Pubco, and the Supporting Company Stockholders, which superseded the Original Stockholder Support Agreement. Pursuant to the Amended and Restated Support Agreement, Pubco, which was not a party to the Original Stockholder Support Agreement, became a party to the Amended and Restated Support Agreement.

Prior to the Closing, the Sponsor and certain One Energy stockholders will enter into an amended and restated registration rights agreement (the “Registration Rights Agreement”). Under the Registration Rights Agreement, the Sponsor and certain other shareholders of the Company and certain One Energy stockholders shall have registration rights that will obligate the Company to register for resale under the Securities Act all or any portion of the (i) ordinary shares of the Company issued to the One Energy stockholders as Transaction Consideration Shares, (ii) the ordinary shares of the Company held by the Sponsor and other legacy shareholders of the Company, (iii) the ordinary shares of the Company issued upon conversion of the ordinary shares of the Company in connection with the Merger, and (iv) the ordinary shares of the Company issuable upon exercise of all warrants held by the Company shareholders (together with any capital shares or other securities issued as a dividend or distribution with respect thereto or in exchange therefor, the “Registrable Securities”). Pursuant to the Registration Rights Agreement, among other things, the Company shall prepare and file a shelf resale registration statement with respect to the registrable securities under the Registration Rights Agreement no later than 60 calendar days prior to the expiration of the applicable post-Closing period. The Company shareholders who hold a majority in interest of the Registrable Securities held by the legacy shareholders of the Company or One Energy stockholders who hold a majority in interest of the Registrable securities held by the legacy One Energy stockholders, will be entitled under the Registration Rights Agreement to make a written demand for registration under the Securities Act of all or part of their Registrable Securities. Subject to certain exceptions, if any time after the Closing, the Company proposes to file a registration statement under the Securities Act with respect to its securities, under the Registration Rights Agreement, the Company shall give notice to the Company shareholders holding Registrable Securities and the One Energy stockholders holding Registrable Securities, as to the proposed filing and offer them an opportunity to register the sale of such number of Registrable Securities as requested by them in writing, subject to customary In addition, subject to certain exceptions, the Company shareholders and the One Energy stockholders holding Registrable Securities will be entitled under the Registration Rights Agreement to request in writing that the Company register the resale of any or all of such Registrable Securities on Form or and any similar short-form registration that may be available at such time. Under the Registration Rights Agreement, the Company will indemnify the holders of Registrable Securities and certain persons or entities related to them, such as their officers, directors, employees, agents and representatives, against any losses or damages resulting from any untrue statement or omission of a material fact in any registration statement or prospectus pursuant to which they sell Registrable Securities, unless such liability arose from their misstatement or omission, and the holders of Registrable Securities, including Registrable Securities in any registration statement or prospectus, will agree to indemnify the Company and certain persons or entities related to the Company, such as its officers and directors and underwriters, against all losses caused by their misstatements or omissions in those documents.

Prior to or in connection with the Closing, the Company, the Sponsor, Jereme Kent and Continental Stock Transfer & Trust Company will enter into a contingent stock rights agreement, pursuant to which Jereme Kent will deposit 5.5 million of the shares of the Company he will receive as consideration in the Transactions into an escrow account to provide certain contingent stock rights to PIPE investors and/or to public shareholders of the Company who do not redeem their shares of the Company in connection with the Transactions, in the event that the post-closing trading price of the combined public company does not equal or exceed a daily VWAP of $12.00 per share over 20 out of any 30 consecutive trading days, during the period after Closing.