Tempo Automation, (Tempo), a software-accelerated electronics manufacturer, and ACE Convergence Acquisition Corp. (ACE), announced today that the Company has secured an aggregate principal amount of $200 million from the issuance of 13.00% (per annum payable semi-annually, 8.00% in cash plus 5.00% in-kind) Convertible Senior Notes due in 2025 (the “Notes”).
The $200 million aggregate principal amount of the Notes consists of a $175 million investment from funds managed by Oaktree Capital Management, L.P. (“Oaktree”), a leading global alternative investment management firm, and $25 million from an investment partner of ACE as a replacement for a previously announced investment, for a total of $175 million of new financing. The Notes are anticipated to fund concurrently with the closing of the proposed business combination of Tempo and ACE (the “Proposed Business Combination”).
As previously announced on October 14, 2021, Tempo and ACE, a special purpose acquisition company focusing on industrial and enterprise IT, along with ACE Convergence Subsidiary Corp., entered into an agreement and plan of merger relating to the Proposed Business Combination. Upon the closing of the Proposed Business Combination, which is subject to the satisfaction or waiver of the conditions stated in the merger agreement and other customary closing conditions, the combined entity is expected to be renamed “Tempo Automation Holdings, Inc.” and shares of its common stock are expected to trade on The Nasdaq Stock Market LLC (“Nasdaq”) under the ticker symbol “TMPO”.
Tempo and ACE currently expect the transaction to be closed, subject to respective shareholder approvals, in Q1 or Q2 2022. The $175 million of the new financing will replace the existing $54 million in net proceeds from the previously announced senior term debt facility. Including this new financing from Oaktree and the previously announced financing from ACE’s affiliates (which is being replaced by the aforementioned investment from an investment partner of ACE), the company will have more than $500 million in proceeds, assuming no redemptions in connection with the closing of the Proposed Business Combination.
The additional financing from Oaktree further strengthens the roster of leading investors supporting the closing of Tempo’s Proposed Business Combination. These investment funds are expected to accelerate Tempo’s ability to power innovation with transformative software and manufacturing capabilities.
\”We know that Oaktree has a high bar for the quality of firms it invests in,” said Joy Weiss, President and Chief Executive Officer of Tempo. “We are excited to have Oaktree’s endorsement of Tempo’s business opportunity and look forward to collaborating with them on realizing its full potential.”
