Tempo Automation and ACE Convergence Acquisition have entered into a committed equity facility with an affiliate of Cantor Fitzgerald. Under terms of the facility, after the proposed business combination between ACE and Tempo has closed, Cantor has committed to purchase up to an aggregate of $100 million of post-merger Tempo’s common stock from time to time upon request. This facility will provide Tempo with the ability to raise additional capital opportunistically in the future, the companies said in a news release.
Tempo Automation is a software-accelerated electronics manufacturer.
As announced in October, the pending merger transaction is expected to provide $391 million in gross cash proceeds to the company from four separate sources:
- $230 million from cash in trust by ACE, assuming no redemptions by shareholders. This is supported by a backstop of up to $95 million, comprised of up to $25 million by ACE Equity Partners, and up to $70 million as part of the Structural Capital and SQN Venture Partners senior term debt facility.
- $82 million fully committed PIPE anchored by Point72 Ventures Investments and ACE Equity Partners with participation from Firsthand Funds and Lux Capital.
- $25 million in convertible note financing, provided by ACE Equity Partners.
- $54 million in net proceeds from a senior term debt facility from Structural Capital and SQN Venture Partners, as part of a $150 million total facility, which also provides up to $70 million to support either future acquisitions or potential redemptions from shareholders of ACE.
Tempo in January then announced it had secured $200 million in covertible note financing, $25 million of which would replace the $25 million previously committed by ACE Equity Partners. The $175 million in new financing comes from funds managed by Oaktree Capital. Read more.
