Moelis & Company Investment Banking Pitch Book
Rizvi Offer Summary (cont'd)
MERGER
CONSIDERATION ¹
FINANCING
EQUITY
ROLLOVER
VOTING
AGREEMENT
COMPANY
TERMINATION FEE
PURCHASER
TERMINATION FEE
EXPENSE
REIMBURSEMENT
REPRESENTATIONS
AND WARRANTIES
MOELIS & COMPANY
▪ Per Share Price (% Premium): $11.00 (18.66% premium to unaffected stock price on 10/01/14 and a 5.47% premium to stock price on
10/19/15)
Implied Market Cap: $590 million
Implied TEV: $551 million
LTM 06/30/15 Adjusted EBITDA Multiple: 10.5x
CY15 Adjusted EBITDA Multiple: 9.8x
STRICTLY CONFIDENTIAL
Funded Debt: $300 million
PF Leverage: 5.2x LTM 06/30/15E PF Adj. Financeable EBITDA ($57.6 million)
Preferred Equity: $140 million (provided by Fortress, with 10% paid-in-kind coupon)
Concurrent with the execution of the merger agreement, Michael Lewis will enter into a rollover commitment letter with the
purchaser (Michael Lewis currently owns 10.6% of fully diluted shares outstanding)
Concurrent with the execution of the merger agreement, Michael Lewis agrees to vote their shares in favor of the transaction
contemplated by the agreement
$24 million paid by Company to the Purchaser within three business days of the termination
Conditions for payment of termination fee:
-If the Purchaser terminates because Board of Directors effects an Adverse Recommendation Change prior to the stockholders
meeting or the Company has a material breach of the non-solicitation provision or covenant to call and hold a stockholders
meeting
-If the Company terminates because Board of Directors has received a superior proposal and failure to accept such proposal
would be a breach of fiduciary duties to the stockholders of Rhombus
- If either Purchaser or the Company terminates because stockholder approval is not given and the Board of Directors affects an
Adverse Recommendation Change
If Purchaser or the Company terminates because the End Date is reached or stockholder approval is not given, or Purchaser
terminates because the Company breaches its reps, warranties or fails to perform its covenants, a person who has made or
announced a takeover proposal and the Company enters into a definitive agreement or consummates such proposal within 12
months of the termination
$29 million paid by Purchaser to the Company within three business days of the termination
Conditions for payment of termination fee:
-If the marketing period has ended and all other conditions to closing are met and Purchaser fails to close within 2 business days
after the end of the marketing period
If Purchaser breaches any of its reps & warrants or fails to perform its covenants
Reasonable out-of-pocket fees and expenses, up to a cap, if agreement is terminated due to a failure to obtain stockholder approval
No survival of reps and warranties
Largely standard for public company transaction
Source: Draft merger agreement dated 11/05/15
LTM Adjusted EBITDA (as of 6/30/15) and CY15 Adjusted EBITDA of $527 and $56.4 million (based on management estimates), respectively; adjusted for share-based compensation,
impairment of assets and intangibles, as well as certain expenses related to the cost reduction plan and non recurring expenses
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