In addition and in connection with the foregoing, we, First Merger Sub and Second Merger Sub entered into Voting and Support Agreements with certain Sonder Stockholders concurrently with the execution of the Merger Agreement, pursuant to which, among other things, such Sonder Stockholders have agreed to vote all of their respective shares of Sonder Stock in favor of, among other things, adopting the Merger Agreement.

pre-closing

This proxy statement/prospectus/consent solicitation statement serves as:

 

 

 

This proxy statement/prospectus/consent solicitation statement does not serve as a prospectus for the Common Stock that our Initial Stockholders (as defined herein) will receive in the Business Combination.

 

(303)

Dear Gores Metropoulos II, Inc. Stockholder:

COVID-19

On April 29, 2021, the Company, Sunshine Merger Sub I, Inc., a Delaware corporation (“”) and a direct, wholly-owned subsidiary of the Second Merger Sub (as defined below), Sunshine Merger Sub II, LLC, a Delaware limited liability company and a direct, wholly-owned subsidiary of the Company (“”) and Sonder Holdings Inc., a Delaware corporation (“”), entered into an Agreement and Plan of Merger (as it may be amended from time to time, the “”), which provides for, among other things, (i) the merger of First Merger Sub with and into Sonder, with Sonder continuing as the surviving corporation (the “”), and (ii) immediately following the First Merger and as part of the same overall transaction as the First Merger, the merger of Sonder with and into Second Merger Sub, with Second Merger Sub continuing as the surviving entity (the “” and, together with the First Merger, the “” and, together with the other transactions contemplated by the Merger Agreement, the “”). As a result of the First Merger, Second Merger Sub will own 100% of the outstanding capital stock of Sonder as the surviving corporation of the First Merger and each share of capital stock of Sonder will be cancelled and converted into the right to receive the merger consideration in accordance with the terms of the Merger Agreement. As a result of the Second Merger, the Company following the Business Combination (the “”) will own 100% of the outstanding interests in the surviving entity of the Second Merger (the “”). Pursuant to the terms of the Merger Agreement, the holders of existing shares of Common Stock of Sonder, par value $0.000001 per share (“”) (following the conversion of each issued and outstanding share of Sonder’s preferred stock and the convertible promissory notes issued by Sonder to certain purchasers pursuant to the Note Purchase Agreement, dated March 12, 2021, as amended, into shares of Sonder Common Stock prior to the effective time of the First Merger), will receive shares of the Post-Combination Company’s Common Stock, par value $0.000001 per share (the “”, which term (a) with reference to the Company prior to the Business Combination and the effectiveness of the Amended and Restated Certificate of Incorporation in the form attached hereto as (the “”), means the Class A Stock and the Class F Stock, and (b) with reference to the Post-Combination Company from and after the effectiveness of the Amended and Restated Certificate of Incorporation and the reclassification of the Class A Stock and Class F Stock in accordance with the Amended and Restated Certificate of Incorporation, the Common Stock, par value $0.000001 per share, of the Post-Combination Company), and holders of existing shares of Special Voting Series AA Common Stock, par value $0.000001 per share (the “”), will receive shares of our newly created Post-Combination Company Special Voting Common Stock, par value $0.000001 per share (the “” and, together with the Post-Combination Company’s Common Stock, the”). In addition, each share of Series AA Common Exchangeable Preferred Shares (the “”) of Sonder Canada Inc., a corporation existing under the laws of the province of Québec (“”) will be exchanged into a new series of the same class of virtually identical Sonder

Canada Exchangeable Common Shares (the “”) exchangeable for Common Stock upon the completion of the the First Merger, and holders of Post-Combination Canada Exchangeable Common Shares will receive our Common Stock upon the exchange of their Post-Combination Canada Exchangeable Common Shares following the consummation of the Business Combination. The Post-Combination Company Special Voting Common Stock will entitle the holders thereof to vote on matters submitted to the stockholders on which the holders of Common Stock are entitled to vote, but the holders of the Post-Combination Company Special Voting Common Stock will not be entitled to receive any dividends out of any assets of the Company. Following the closing of the Business Combination, the Company will own, directly or indirectly, all of the issued and outstanding equity interests in the Surviving Entity and its subsidiaries, and the securityholders of Sonder as of immediately prior to the effective time of the First Merger (the “”) are expected to hold approximately 74.1% of the Post-Combination Company Stock. You are being asked to vote on the Business Combination.

Subject to the terms of the Merger Agreement and customary adjustments set forth therein, the aggregate merger consideration (excluding any Earn Out Shares) to be paid in connection with the Business Combination is expected to be approximately 217,660,300 shares of the Post-Combination Company’s Common Stock with an implied value (based on an assumed value of $10.00 per share) equal to approximately $2,176,603,000. However, certain of these shares of Common Stock will be reserved for issuance upon (a) the exercise of Rollover Options and (b) the exchange of the Post-Combination Canada Exchangeable Common Shares corresponding to shares of Post-Combination Company Special Voting Common Stock to be issued in the Business Combination. Holders of Sonder Stock Options will not receive their portion of the 217,660,300 shares of Post-Combination Company’s Common Stock issued as consideration in the Business Combination at the completion of the Business Combination, but will instead receive Rollover Options, which may be exercisable following the Business Combination for the applicable number of shares of the Post-Combination Company’s Common Stock. Holders of Sonder Special Voting Common Stock will not receive their portion of the 217,660,300 shares of Post-Combination Company’s Common Stock issued as consideration in the Business Combination at the completion of the Business Combination, but will instead receive shares of Post-Combination Company Special Voting Common Stock, which shares of Post-Combination Company Special Voting Common Stock may be redeemed upon the future exchange by holders of Post-Combination Canada Exchangeable Common Shares for the applicable number of shares of the Post-Combination Company’s Common Stock. Based on 17,099,526 outstanding Sonder Stock Options and 22,017,113 outstanding Sonder Canada Exchangeable Common Shares as of June 30, 2021 (x) approximately 28,898,199 Rollover Options (corresponding to approximately 28,898,199 shares of the Post-Combination Company’s Common Stock) would be expected to be outstanding immediately following the consummation of the Business Combination (assuming an Option Exchange Ratio equal to 1.69 and excluding any additional Discounted Earn Out Option Amount, which will be determined on or prior to the consummation of the Business Combination) and (y) approximately 37,208,921 shares of Post-Combination Company Special Voting Common Stock (corresponding to approximately 37,208,921 shares of the Company’s Common Stock) would be expected to be issued as consideration in the Business Combination (assuming an Exchange Rate of 1.69). The consideration to be paid to the Sonder Stockholders will be the Per Share Sonder Common Stock Consideration and the Per Share Sonder Special Voting Stock Consideration, as applicable, consisting of (a) with respect to Sonder Common Stock, par value $0.000001, a number of shares of our newly issued Common Stock equal to (i)(A) $2,176,603,000, divided by (B) $10.00, divided by (ii) the number of Sonder Stock Adjusted Fully Diluted Shares and (b) with respect to Sonder Special Voting Common Stock, a number of shares of our newly issued Post-Combination Company Special Voting Common Stock equal to (i) the number of shares of Sonder Special Voting Common Stock multiplied by (ii) the Exchange Rate (as defined below). Following the closing of the Business Combination, Sonder equityholders may receive up to 14,500,000 additional shares of Common Stock as consideration as a result of the Common Stock achieving certain benchmark share prices as contemplated by the Merger Agreement pursuant to the earn out.

connection with the effectiveness of the Amended and Restated Certificate of Incorporation and will continue to be subject to the transfer restrictions applicable to the Founder Shares.

Annex A

Annex B

non-binding

Each of these proposals is more fully described in this proxy statement/prospectus/consent solicitation statement, which each stockholder is encouraged to read carefully.

Our Public Shares, Public Units and Public Warrants are currently listed on Nasdaq under the symbols “GMII,” “GMIIU” and “GMIIW,” respectively. We intend to apply to continue the listing of our Common Stock (following the reclassification of Class A Stock into Common Stock upon the effectiveness of the Amended and Restated Certificate of Incorporation) and Public Warrants on Nasdaq under the symbols “SOND” and “SONDW,” respectively, upon the closing of the Business Combination.

Pursuant to the Amended and Restated Certificate of Incorporation of the Company, dated January 19, 2021 (the “”), we are providing our Public Stockholders with the opportunity to redeem, upon the closing of the Business Combination, shares of Class A Stock then held by them for cash equal to their pro rata share of the aggregate amount on deposit (as of two business days prior to the closing of the Business Combination) in the Trust Account that holds the proceeds of the Company IPO (including interest not previously released to the Company to fund regulatory compliance requirements and other costs related thereto, subject to an annual limit of $900,000, for a maximum of 24 months, using funds released to the Company from the Trust Account (“”) and/or to pay its franchise and income taxes). The amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commission totaling $15,750,000 that we will pay to the underwriters of the Company IPO or transaction expenses incurred in connection with the Business Combination. For illustrative purposes, based on the balance of the Trust Account of $450,018,248 as of June 30, 2021, the estimated per share redemption price would have been approximately $10.00. Public Stockholders may elect to redeem their shares even if they vote for the Business Combination. A Public Stockholder, together with any of its affiliates or any other person with whom it is acting in concert or as a “” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 20% of the shares of Class A Stock included in the Public Units sold in the Company IPO. We refer to this as the “.” We have no specified maximum redemption threshold under our Current Company Certificate, other than the aforementioned 20% threshold. Each redemption of shares of Class A Stock by our Public Stockholders will reduce the amount in the Trust Account. The Merger Agreement provides that the obligation of Sonder to consummate the Business Combination is conditioned on the total of (i) the amount in the Trust Account, after giving effect to redemptions of Public Shares, (ii) the proceeds from the purchase of 20,000,000 shares of Class A Stock (which will be reclassified into Common Stock upon the effectiveness of the Amended and Restated Certificate of Incorporation) pursuant to the Subscription Agreements (the “”), and (iii) all funds held by us outside of the Trust Account and immediately available to us, equaling or exceeding $500,000,000. This condition to closing in the Merger Agreement is for the sole benefit of Sonder and may be waived by Sonder. If, as a result of redemptions of Class A Stock by our Public Stockholders, this condition is not met (or waived), then Sonder may elect not to consummate the Business Combination. In addition, in no event will we redeem shares of our Class A Stock in an amount that would result in the Company’s failure to have net tangible assets equaling or exceeding $5,000,001. Holders of our outstanding Public Warrants do not have redemption rights in connection with the Business Combination. Unless otherwise specified, the information in the accompanying proxy statement/prospectus/consent solicitation statement assumes that none of our Public Stockholders exercise their redemption rights with respect to their shares of Class A Stock. Our Sponsor and current independent directors (collectively, our “”), as well as our officers and other current directors, have agreed to waive their redemption rights with respect to their shares of Common Stock in connection with the consummation of the Business Combination, and the Founder Shares will be excluded from the pro rata calculation used to determine the redemption price. Our Initial Stockholders have also agreed to waive their right to a conversion price adjustment with respect to any shares of our Common Stock they may hold in connection with the consummation of the Business Combination. Currently, our Initial Stockholders own 20% of our issued and outstanding shares of Common Stock, including all of the Founder Shares. Our Initial Stockholders, directors and officers have agreed to vote any shares of our Common Stock owned by them in favor of the Business Combination. The Founder Shares are subject to transfer restrictions.

We are providing the accompanying proxy statement/prospectus/consent solicitation statement and accompanying proxy card to our stockholders in connection with the solicitation of proxies to be voted at the Special Meeting (including following any adjournments or postponements of the Special Meeting). Information about the Special Meeting, the Business Combination and other related business to be considered by our

stockholders at the Special Meeting is included in this proxy statement/prospectus/consent solicitation statement. ” beginning on page 72 of this proxy statement/prospectus/consent solicitation statement.

Approval of the Business Combination Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Approval of the Nasdaq Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Approval of the Charter Proposal requires (i) the affirmative vote of holders of a majority of our outstanding shares of Common Stock entitled to vote thereon at the Special Meeting and (ii) the affirmative vote of holders of a majority of our outstanding shares of Class F Stock, voting separately as a single class, entitled to vote thereon at the Special Meeting. Approval of the Governance Proposals requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Approval of each of the Management Equity Incentive Plan Proposal, the Incentive Plan Proposal and the ESPP Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Approval of the Director Election Proposal requires the affirmative vote of a plurality of votes cast by holders of our outstanding shares of Class F Stock, voting separately as a single class, represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Approval of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting.

Your vote is very important

solicitation statement. Additionally, the Director Election Proposal is not conditioned on the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal or any other proposal set forth in this proxy statement/prospectus/consent solicitation statement.

On behalf of our Board, I would like to thank you for your support of Gores Metropoulos II, Inc. and look forward to a successful consummation of the Business Combination.

 

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THIS PROXY STATEMENT/PROSPECTUS/CONSENT SOLICITATION STATEMENT, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THIS PROXY STATEMENT/PROSPECTUS/CONSENT SOLICITATION STATEMENT. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.

This proxy statement/prospectus/consent solicitation statement is dated [●], 2021, and is expected to be first mailed or otherwise delivered to Company stockholders on or about [●], 2021.

To the Stockholders of Gores Metropoulos II, Inc.:

COVID-19

 

 

 

 

 

 

 

 

 

Annex A

The record date for the Special Meeting is [●], 2021. Only stockholders of record at the close of business on that date may vote at the Special Meeting or any adjournment thereof. A complete list of our stockholders of record entitled to vote at the Special Meeting will be available for ten days before the Special Meeting at our principal executive offices for inspection by stockholders during ordinary business hours for any purpose germane to the Special Meeting.

per-share

Combination. For illustrative purposes, based on the balance of the Trust Account of $450,018,248 as of June 30, 2021, the estimated per share redemption price would have been approximately $10.00. . A Public Stockholder, together with any of its affiliates or any other person with whom it is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 20% of the shares of Common Stock included in the Public Units sold in the Company IPO. Each redemption of shares of Class A Stock by our Public Stockholders will reduce the amount in the Trust Account. We have no specified maximum redemption threshold under our Current Company Certificate, other than the aforementioned 20% threshold. The Merger Agreement provides that the obligation of Sonder to consummate the Business Combination is conditioned on the total of (i) the amount in the Trust Account, after giving effect to redemptions of Public Shares, (ii) the proceeds from the purchase of 20,000,000 shares of Class A Stock (which will be reclassified into Common Stock upon the effectiveness of the Amended and Restated Certificate of Incorporation) pursuant to the Subscription Agreements (the “”) and (iii) all funds held by us outside of the Trust Account and immediately available to us, equaling or exceeding $500,000,000. This condition to closing in the Merger Agreement is for the sole benefit of Sonder and may be waived by Sonder. If, as a result of redemptions of Class A Stock by our Public Stockholders, this condition is not met (or waived), then Sonder may elect not to consummate the Business Combination. In addition, in no event will we redeem shares of our Class A Stock in an amount that would result in the Company’s failure to have net tangible assets equaling or exceeding $5,000,001. Holders of our outstanding Public Warrants do not have redemption rights in connection with the Business Combination.

per-share

The Business Combination is conditioned on the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal and the Director Election Proposal at the Special Meeting. If we fail to obtain sufficient votes for any of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal or the Director Election Proposal, we will not satisfy the conditions to closing of the Merger Agreement and we may be prevented from closing the Business Combination. Each of the proposals other than the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal and the Director Election Proposal, is conditioned on the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal and the Director Election Proposal, other than the Governance Proposals and the Adjournment Proposal, which are not conditioned on the approval of any other proposal set forth in this proxy statement/prospectus/consent solicitation statement. Additionally, the Director Election Proposal is not conditioned on the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal or any other proposal set forth in this proxy statement/prospectus/consent solicitation statement.

A majority of the issued and outstanding shares of our Common Stock entitled to vote as of the record date at the Special Meeting must be present, in person via the virtual meeting platform or represented by proxy, at the Special Meeting to constitute a quorum and in order to conduct business at the Special Meeting. The approval of the Business Combination Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. The approval of the Nasdaq Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. The approval of the Charter Proposal requires (i) the affirmative vote of holders of a majority of our outstanding shares of Common Stock entitled to vote thereon at the Special Meeting and (ii) the affirmative vote of holders of a majority of our outstanding shares of Class F Stock, voting separately as a single class, entitled to vote thereon at the Special Meeting. The approval of the Governance Proposals requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or

 

non-binding

Annex

 A

Annex L

Sonder’s board of directors has considered the Business Combination and the terms of the Merger Agreement and has unanimously determined that the Business Combination and the Merger Agreement are fair to and in the best interests of Sonder and the Sonder Stockholders and recommends that the Sonder Stockholders (i) adopt the Merger Agreement and (ii) approve each of the amendments described in Proposal No. 4 of this proxy statement/prospectus/consent solicitation statement by submitting a written consent.

If you have any questions concerning the Merger Agreement, the Business Combination, the consent solicitation or the accompanying proxy statement/prospectus/consent solicitation statement, or if you have any questions about how to deliver your written consent, please contact Sonder’s agent in connection with the consent solicitation, Avery Minor, at aminor@wsgr.com.

 

 

 

i

 

 

ii

In this proxy statement/prospectus/consent solicitation statement:

“” means the proposed Amended and Restated Bylaws of the Company, a form of which is attached hereto as , which will become the Post-Combination Company’s bylaws.

Annex B

 

1

Annex D

“” means units that have signed real estate contracts, but are not yet available for guests to book. Sonder is not yet able to generate revenue from these units. Some of the real estate contracts for Contracted Units have contingencies that must be satisfied prior to Sonder’s takeover of the units or are terminable by Sonder or the landlord prior to Sonder’s takeover of the units.

lock-up

“” means Deloitte & Touche LLP, independent auditors to Sonder.

 

2

“” means the period beginning on the 180th day following the closing date of the Business

 

3

Annex A

“” means the shares of a new series of Sonder Canada, virtually identical to the Sonder Canada Exchangeable Common Shares, exchangeable for the Post-Combination Company’s Common Stock upon the completion of the First Merger.

 

4

lock-up

one-fifth

Annex F

Lock-Up

Lock-Up

 

5

Seed-1

Seed-2

Seed-3

Seed-1

Seed-1A

Seed-2

Seed-2A

Seed-3

Seed-3A

A-1

B-1

C-1

D-1

 

6

Seed-1A

Seed-2A

Seed-3A

A-1

B-1

C-1

D-1

Seed-1

Seed-2

Seed-3

 

7

 

8

The Company, Sonder and Sonder’s subsidiaries own or have rights to trademarks, trade names and service marks that they use in connection with the operation of their business. In addition, their names, logos and website names and addresses are their trademarks or service marks. “Sonder” and the Sonder logo are registered and unregistered trademarks of Sonder Canada Inc. in the United States and other jurisdictions. Other trademarks, trade names and service marks appearing in this proxy statement/prospectus/consent solicitation statement are the property of their respective owners. Solely for convenience, in some cases, the trademarks, trade names and service marks referred to in this proxy statement/prospectus/consent solicitation statement are listed without the applicable , and SM symbols, but they will assert, to the fullest extent under applicable law, their rights to these trademarks, trade names and service marks.

 

9

COVID-19

Annex A

This proxy statement/prospectus/consent solicitation statement and its Annexes contain important information about the proposed Business Combination and the other matters to be acted upon at the Special Meeting. You should read this proxy statement/prospectus/consent solicitation statement and its Annexes carefully and in their entirety.

COVID-19

A: Our stockholders are being asked to approve the following proposals:

 

 

10

 

 

 

 

 

 

 

 

A: Yes. The Business Combination is conditioned on the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal and the Director Election Proposal at the Special Meeting. If we fail to obtain sufficient votes for any of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal or the Director Election Proposal, we will not satisfy the conditions to closing of the Merger Agreement and we may be prevented from closing the Business Combination. Each of the proposals other than the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal and the Director Election Proposal is conditioned on the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal and the Director Election Proposal, other than the Governance Proposals and the Adjournment Proposal, which are not conditioned on the approval of any other proposal set forth in this proxy statement/prospectus/consent solicitation statement. Additionally, the Director Election Proposal is not conditioned on the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal or any other proposal set forth in this proxy statement/prospectus/consent solicitation statement. It is important for you to note that in the event that the Business Combination Proposal, the Nasdaq Proposal, or the Charter Proposal do not receive the requisite vote for approval, we will not consummate the Business Combination. Unless we amend our Current Company

 

11

Certificate (which requires the affirmative vote of 65% of all then outstanding shares of Class A Stock) and amend certain other agreements into which we have entered to extend the life of the Company, if we do not consummate the Business Combination and fail to complete an initial business combination by January 22, 2023, we will be required to dissolve and liquidate our Trust Account by returning the then remaining funds in such account to the Public Stockholders.

A: Under the Current Company Certificate, we must provide all holders of Public Shares with the opportunity to have their Public Shares redeemed upon the consummation of our initial business combination either in conjunction with a tender offer or in conjunction with a stockholder vote. For business and other reasons, we have elected to provide our stockholders with the opportunity to have their Public Shares redeemed in connection with a stockholder vote rather than a tender offer. Therefore, we are seeking to obtain the approval of our stockholders of the Business Combination Proposal in order to allow our Public Stockholders to effectuate redemptions of their Public Shares in connection with the closing of the Business Combination. The approval of the Business Combination is required under the Current Company Certificate. In addition, such approval is also a condition to the closing of the Business Combination under the Merger Agreement.

 

12

A: Pursuant to the Merger Agreement, and upon the terms and subject to the conditions set forth therein, the Company will acquire Sonder in a series of transactions we collectively refer to as the “Business Combination.” At the closing of the Business Combination contemplated by the Merger Agreement, among other things, First Merger Sub will merge with and into Sonder, with Sonder continuing as the Surviving Corporation, and the Surviving Corporation will merge with and into Second Merger Sub, with Second Merger Sub continuing as the Surviving Entity. As a result of the Mergers, immediately following the closing of the Business Combination, the Post-Combination Company will own 100% of the outstanding equity interests of Sonder, and each share of Sonder Common Stock will be cancelled and converted into the right to receive the Per Share Sonder Common Stock Consideration and each share of Sonder Special Voting Common Stock will be cancelled and converted into the right to receive the Per Share Sonder Special Voting Stock Consideration.

A: On April 29, 2021, the trading date before the public announcement of the Business Combination, the Public Units, Public Shares and Public Warrants closed at $10.25, $9.94 and $1.43, respectively. On [●], 2021 the trading date immediately prior to the date of this proxy statement/prospectus/consent solicitation statement, the Public Units, Public Shares and Public Warrants closed at $[●], $[●] and $[●], respectively.

A: Yes. The Public Shares, Public Units and Public Warrants are currently listed on Nasdaq under the symbols “GMII,” “GMIIU” and “GMIIW,” respectively. We intend to apply to continue the listing of our Common Stock (following the reclassification of Class A Stock into Common Stock upon the effectiveness of the Amended and Restated Certificate of Incorporation) and Public Warrants on Nasdaq under the symbols “SOND” and “SONDW,” respectively, upon the closing of the Business Combination.

A: Upon the closing of the Business Combination, it is anticipated that the Post-Combination Company’s board will be composed of one director in Class I (expected to be [●]), one director in Class II (expected to be [●]) and two directors in Class III (expected to be [●] and [●]). The term of the initial Class I Director will expire at the first annual meeting of Post-Combination Company stockholders, the term of the initial Class II Director will expire at the second annual meeting of Post-Combination Company stockholders, and the term of the initial Class III Directors will expire at the third annual meeting of Post-Combination Company stockholders. At each annual meeting of Post Combination Company stockholders, beginning with the first annual meeting of Post-Combination Company stockholders, successors to the class of directors whose term expires at that annual meeting will be elected for a three-year term or until the election and qualification of their respective successors in office, subject to their earlier death, resignation or removal.

A: Following the closing of the Business Combination, it is expected that the current senior management of Sonder will comprise the senior management of the Post-Combination Company.

 

13

A: Subject to the terms of the Merger Agreement, Sonder Stockholders at the closing of the Business Combination are expected to receive a number of shares of Common Stock (deemed to have a value of $10.00 per share) equal to the Per Share Sonder Common Stock Consideration and the Per Share Sonder Special Voting Stock Consideration, or such shares resulting from the Canadian Split, as applicable, plus the Earn Out Shares, if and when applicable.

Immediately prior to the effective time of the First Merger, each issued and outstanding share of Sonder Preferred Stock will convert into shares of Sonder Common Stock, pursuant to the Sonder Certificate of Incorporation. Holders of shares of Sonder Common Stock will be entitled to receive a number of newly issued shares of Common Stock equal to the Per Share Sonder Common Stock Consideration for each such share of Sonder Common Stock.

Holders of shares of Sonder Special Voting Common Stock will be entitled to receive a number of newly issued shares of Post-Combination Company Special Voting Common Stock equal to the Per Share Sonder Special Voting Stock Consideration for each such share of Sonder Special Voting Stock.

In addition to the consideration to be paid at the closing of the Business Combination, equityholders of Sonder will be entitled to receive their pro rata share of an additional number of Earn Out Shares from the Post-Combination Company, up to an aggregate of 14,500,000 shares of Common Stock collectively issuable to all Sonder equityholders.

 

14

A: Each Sonder Warrant, to the extent then outstanding and unexercised, will automatically be converted into a warrant, subject to the same terms and conditions as were applicable to the corresponding Sonder Warrant prior to the effective time of the First Merger, to acquire a number of shares of Common Stock (rounded down to the nearest whole share) equal to multiplying the number of shares of Sonder Stock subject to the Sonder Warrant by the Per Share Sonder Common Stock Consideration (rounded down to the nearest whole number of shares) at a per share exercise price equal to (x) the per share exercise price of the shares of Sonder Stock subject to the Sonder Warrant, as in effect immediately prior to the effective time of the First Merger, divided by (y) the Per Share Sonder Common Stock Consideration (rounded up to the nearest whole cent). Holders of each Sonder Warrant will also be entitled to Earn Out Shares pursuant to the applicable terms and conditions set forth in the Merger Agreement.

A: Yes. The Company will use the proceeds from the PIPE Investment, together with the funds in the Trust Account, to fund the cash consideration to be contributed to Sonder in the Business Combination, and to pay

 

15

certain transaction expenses. The PIPE Investment is contingent upon, among other things, stockholder approval of the Business Combination Proposal and the closing of the Business Combination. The Company does not anticipate obtaining any new debt financing to fund the Business Combination.

A: Unless waived by Sonder, the Merger Agreement provides that the obligation of Sonder to consummate the Business Combination is conditioned on the total of (i) the amount in the Trust Account, after giving effect to redemptions of Public Shares, (ii) the proceeds from the PIPE Investment and (iii) all funds held by us outside of the Trust Account and immediately available to us, equaling or exceeding $500,000,000.

The PIPE Investors have agreed to purchase approximately 20,000,000 shares of Class A Stock (which will be reclassified into Common Stock upon the effectiveness of the Amended and Restated Certificate of Incorporation) in the aggregate in the PIPE Investment at a price of $10.00 per share (subject to customary terms and conditions, including the closing of the Business Combination) for gross proceeds to the Company of approximately $200,000,000 pursuant to Subscription Agreements entered into at the signing of the Business Combination.

The Company did not consider financing arrangements other than the PIPE Investment, as the Company believes that cash generated from the additional equity invested in connection with the PIPE Investment is preferable to other financing arrangements.

A: We are proposing the Nasdaq Proposal in order to comply with Nasdaq Listing Rules 5635(a) and (d), which require stockholder approval of certain transactions that result in the issuance of 20% or more of the outstanding voting power or shares of Common Stock outstanding before the issuance of stock or securities.

In connection with the Business Combination and the PIPE Investment, we expect to issue approximately 237,660,300 shares of Post-Combination Company Stock, which (a) includes 20,000,000 shares of Class A Stock (which will be reclassified into Common Stock upon the effectiveness of the Amended and Restated Certificate of Incorporation) to be issued to the PIPE Investors pursuant to the Subscription Agreements, (b) assumes the issuance of approximately 28,898,199 shares of Common Stock related to the exercise of Rollover Options based on Sonder’s capitalization as of June 30, 2021 and (c) assumes approximately 37,208,921 shares of Post-Combination Company Special Voting Common Stock to be issued in the Business Combination (each of which corresponds to a share of Common Stock reserved for issuance by the Company upon the exchange of the Post-Combination Canada Exchangeable Common Shares corresponding to such share of Post-Combination Company Special Voting Common Stock) based on Sonder’s capitalization as of June 30, 2021. Because we may issue 20% or more of our outstanding common stock when including the Per Share Sonder Company Stock Consideration and Per Share Sonder Special Voting Stock Consideration, we are required to obtain stockholder approval of such issuance pursuant to Nasdaq Listing Rules 5635(a) and (d). For more information, please see the section titled “.”

 

16

non-binding

A: We are proposing the Adjournment Proposal to allow the chairman of the Special Meeting to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal, the Management Equity Incentive Plan, the Incentive Plan Proposal, the ESPP Proposal or the Director Election Proposal but no other proposal if the Business Combination

 

17

A: The record date for the Special Meeting is earlier than the date that the Business Combination is expected to be completed. If you transfer your shares of Class A Stock after the record date, but before the Special Meeting, unless the transferee obtains from you a proxy to vote those shares, you will retain your right to vote at the Special Meeting. However, you will not be able to seek redemption of your shares of Class A Stock because you will no longer be able to deliver them for cancellation upon consummation of the Business Combination. If you transfer your shares of Class A Stock prior to the record date, you will have no right to vote those shares at the Special Meeting or redeem those shares for a pro rata portion of the proceeds held in our Trust Account.

non-votes

non-votes

non-vote

non-vote

 

18

non-vote

non-vote

non-vote

non-votes

non-vote

A: Unless we amend our Current Company Certificate (which requires the affirmative vote of 65% of all then outstanding shares of Class A Stock) and amend certain other agreements into which we have entered to extend the life of the Company, if the Business Combination Proposal is not approved and we do not consummate an initial business combination by January 22, 2023, we will be required to dissolve and liquidate the Trust Account.

A: Our stockholders are entitled to one vote on each proposal presented at the Special Meeting for each share of Common Stock held of record as of [●], 2021, the record date for the Special Meeting, except that only the Class F Stock is entitled to vote on the Director Election Proposal. As of the close of business on the record date, there were [●] outstanding shares of Common Stock.

 

19

A: A majority of the issued and outstanding shares of Common Stock entitled to vote as of the record date at the Special Meeting must be present, in person via the virtual meeting platform or represented by proxy, at the Special Meeting to constitute a quorum and in order to conduct business at the Special Meeting. Abstentions will be counted as present for the purpose of determining a quorum. Our Initial Stockholders, who currently own 20% of our issued and outstanding shares of Common Stock, will count towards this quorum. In the absence of a quorum, the chairman of the Special Meeting has power to adjourn the Special Meeting. As of the record date for the Special Meeting, [●] shares of Common Stock would be required to achieve a quorum.

A: Prior to the Company IPO, we entered into agreements with our Sponsor and each of our directors and officers, pursuant to which each agreed to vote any shares of Common Stock owned by them in favor of the Business Combination Proposal. None of our Sponsor, directors or officers has purchased any shares of our Common Stock during or after the Company IPO and, as of the date of this proxy statement/prospectus/consent solicitation statement, neither we nor our Sponsor, directors or officers have entered into agreements, and are not currently in negotiations, to purchase shares prior to the consummation of the Business Combination. Currently, our Initial Stockholders own 20% of our issued and outstanding shares of Common Stock, including all of the Founder Shares, and will be able to vote all such shares at the Special Meeting.

 

 

 

 

 

 

20

 

 

 

 

 

 

 

 

 

 

21

 

These interests may influence our Board in making their recommendation that you vote in favor of the approval of the Business Combination.

A: Yes. Although the Current Company Certificate does not require our Board to seek a third-party valuation or fairness opinion in connection with a business combination unless the target is affiliated with our Sponsor, directors or officers, Moelis delivered a written fairness opinion to our Board, dated April 29, 2021, to the effect that, as of the date of such opinion and based upon and subject to the assumptions, conditions and limitations set forth in the opinion, the consideration to be paid by the Company in the Business Combination was fair, from a financial point of view, to the Company.

Annex H

A: If you vote against the Business Combination Proposal but the Business Combination Proposal still obtains the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting, then the Business Combination Proposal will be approved and, assuming the approval of the Nasdaq Proposal and the Charter Proposal and the satisfaction or waiver of the other conditions to closing, the Business Combination will be consummated in accordance with the terms of the Merger Agreement.

If you vote against the Business Combination Proposal and the Business Combination Proposal does not obtain the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting, then the Business Combination Proposal will fail and we will not consummate the Business Combination. If we do not consummate the Business Combination, we may continue to try to complete an initial business combination with a different target business until January 22, 2023. Unless we amend our Current Company Certificate (which requires the affirmative vote of 65% of all then outstanding shares of Class A Stock)

 

22

and amend certain other agreements into which we have entered to extend the life of the Company, if we fail to complete an initial business combination by January 22, 2023, we will be required to dissolve and liquidate the Trust Account by returning the then-remaining funds in such account to our Public Stockholders.

A: If you are a Public Stockholder, you may redeem your Public Shares for cash at the applicable redemption price per share equal to the quotient obtained by dividing (i) the aggregate amount on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, including interest not previously released to us to fund Regulatory Withdrawals and/or to pay its franchise and income taxes, by (ii) the total number of then-outstanding Public Shares; provided that we may not redeem any shares of Class A Stock issued in the Company IPO to the extent that such redemption would result in our failure to have net tangible assets (as determined in accordance with Rule of the Exchange Act) in excess of $5,000,000. A Public Stockholder, together with any of his, her or its affiliates or any other person with whom it is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 20% of the shares of Class A Stock included in the Public Units sold in the Company IPO. Holders of our outstanding Public Warrants do not have redemption rights in connection with the Business Combination. Our Sponsor, directors and officers have agreed to waive their redemption rights with respect to their shares of Common Stock in connection with the consummation of the Business Combination, and the Founder Shares will be excluded from the pro rata calculation used to determine the redemption price. Our Initial Stockholders have also agreed to waive their right to a conversion price adjustment with respect to any shares of our Common Stock they may hold in connection with the consummation of the Business Combination. For illustrative purposes, based on the balance of the Trust Account of $450,018,248 as of June 30, 2021, the estimated per share redemption price would have been approximately $10.00. Additionally, shares properly tendered for redemption will only be redeemed if the Business Combination is consummated; otherwise holders of such shares will only be entitled to a pro rata portion of the Trust Account (including interest not previously released to the Company to fund Regulatory Withdrawals and/or to pay its franchise and income taxes) in connection with the liquidation of the Trust Account, unless we complete an alternative initial business combination prior to January 22, 2023 or we amend our Current Company Certificate (which requires the affirmative vote of 65% of all then outstanding shares of Class A Stock) and amend certain other agreements into which we have entered to extend the life of the Company.

A: No. Our Initial Stockholders, officers and other current directors have agreed to waive their redemption rights with respect to their Founder Shares and any Public Shares they may hold in connection with the consummation of the Business Combination.

A: Yes. A Public Stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), is restricted from exercising redemption rights with respect to more than an aggregate of 20% of the shares sold in the Company IPO. Accordingly, all shares in excess of 20% owned by a holder or “group” of holders will not be redeemed for cash. On the other hand, a Public Stockholder who holds less than 20% of the Public Shares and is not a member of a “group” may redeem all of the Public Shares held by such stockholder for cash.

In no event is your ability to vote all of your shares (including those shares held by you or by a “group” in excess of 20% of the shares sold in the Company IPO) for or against the Business Combination restricted.

We have no specified maximum redemption threshold under the Current Company Certificate, other than the aforementioned 20% threshold. Each redemption of shares of Class A Stock by our Public Stockholders will

 

23

A: Yes. The Current Company Certificate provides that we may not redeem our Public Shares in an amount that would result in our failure to have net tangible assets in excess of $5,000,000 (such that we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which may be contained in the Merger Agreement. Other than this limitation, the Current Company Certificate does not provide a specified maximum redemption threshold. In addition, the Merger Agreement provides that the obligation of Sonder to consummate the Business Combination is conditioned on the total of (i) the amount in the Trust Account, after giving effect to redemptions of Public Shares, (ii) the proceeds from the PIPE Investment and (iii) all funds held by us outside of the Trust Account and immediately available to us, equaling or exceeding $500,000,000. In the event the aggregate cash consideration we would be required to pay for all shares of Class A Stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the Merger Agreement exceeds the aggregate amount of cash available to us, we may not complete the Business Combination or redeem any shares, all shares of Class A Stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate initial business combination.

8-K

A: No. You may exercise your redemption rights whether you vote your Public Shares for or against, or whether you abstain from voting on, the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal, the Governance Proposals or any other proposal described by this proxy statement/prospectus/consent solicitation statement. As a result, the Merger Agreement can be approved by stockholders who will redeem their shares and no longer remain stockholders, leaving stockholders who choose not to redeem their shares holding

 

24

shares in a company with a potentially less-liquid trading market, fewer stockholders, potentially less cash and the potential inability to meet the listing standards of Nasdaq.

A: In order to exercise your redemption rights, you must (i) if you hold Public Units, separate the underlying Public Shares and Public Warrants, and (ii) prior to 5:00 P.M., Eastern Time on [●], 2021 (two business days before the Special Meeting), tender your shares physically or electronically and submit a request in writing that the Company redeem your Public Shares for cash to Computershare Trust Company, N.A., the Transfer Agent, at the following address:

Computershare Trust Company, N.A.

520 Pike Street, Suite 1305

Seattle, WA 98101

Attention: Joe Campbell

Email: joseph.campbell@computershare.com

Please check the box on the enclosed proxy card marked “Stockholder Certification” if you are not acting in concert or as a “group” (as defined in of the Exchange Act) with any other stockholder with respect to the Public Shares. Notwithstanding the foregoing, a holder of the Public Shares, together with any affiliate of his or any other person with whom he is acting in concert or as a “group” (as defined in of the Exchange Act) will be restricted from seeking redemption rights with respect to more than 20% of the Public Shares included in the Public Units sold in the Company IPO. Accordingly, all Public Shares in excess of the aforementioned 20% threshold beneficially owned by a Public Stockholder or group will not be redeemed for cash. Additionally, you must identify to the Company the beneficial holder of the Public Shares being redeemed in order to validly redeem Public Shares.

Company stockholders seeking to exercise their redemption rights and opting to deliver physical certificates should allot sufficient time to obtain physical certificates from the Transfer Agent and time to effect delivery. It is our understanding that Company stockholders should generally allot at least two weeks to obtain physical certificates from the Transfer Agent. However, we do not have any control over this process and it may take longer than two weeks. Company stockholders who hold their shares in street name will have to coordinate with their bank, broker or other nominee to have the shares certificated or delivered electronically.

There is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC system. The Transfer Agent will typically charge a tendering broker a fee, and it is in the broker’s discretion whether or not to pass this cost on to the redeeming stockholder. However, this fee would be incurred regardless of whether or not stockholders seeking to exercise redemption rights are required to tender their shares, as the need to deliver shares is a requirement to exercising redemption rights, regardless of the timing of when such delivery must be effectuated.

 

25

A: No. Appraisal rights or dissenters’ rights are not available to holders of shares of Common Stock in connection with the Business Combination.

A: If the Business Combination is consummated, the funds held in the Trust Account (together with the proceeds from the PIPE Investment) will be used to: (i) pay our Public Stockholders who properly exercise their redemption rights; (ii) pay $15,750,000 in deferred underwriting commissions to the underwriters of the Company IPO, in connection with the Business Combination; and (iii) pay certain other fees, costs and expenses (including regulatory fees, legal fees, accounting fees, printer fees and other professional fees) that were incurred by the Company and other parties to the Merger Agreement in connection with the transactions contemplated by the Merger Agreement, including the Business Combination, and pursuant to the terms of the Merger Agreement. Any remaining funds will be used by the Company for general corporate purposes.

If we do not consummate the Business Combination, we may continue to try to complete an initial business combination with a different target business until January 22, 2023. Unless we amend the Current Company

 

26

per-share

Holders of our Founder Shares have waived any right to any liquidation distribution with respect to such shares. In addition, if we fail to complete an initial business combination by January 22, 2023, there will be no redemption rights or liquidating distributions with respect to our outstanding warrants, which will expire worthless unless we amend our Current Company Certificate and amend certain other agreements into which we have entered to extend the life of the Company.

C-1

C-1

D-1

D-1

 

27

On April 29, 2021, the Company and the Sonder Supporting Stockholders with a sufficient number of votes to achieve the Sonder Requisite Approval entered into Voting and Support Agreements, pursuant to which, among other things, such Sonder Supporting Stockholders agreed to vote their shares of Sonder Stock in favor of the adoption of the Merger Agreement and the transactions contemplated thereby, including the Business Combination, among other proposals. Sonder will solicit the written consent of Sonder Stockholders, including the Sonder Supporting Stockholders, to approve the Merger Agreement and the transactions contemplated thereby, including the Business Combination, among other proposals, prior to the consummation of the Business Combination.

A: You are urged to read carefully and consider the information contained in this proxy statement/prospectus/consent solicitation statement, including the Annexes, and to consider how the Business Combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus/consent solicitation statement and on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker, bank or nominee.

A: If you were a holder of record of shares of our Common Stock on [●], 2021, the record date for the Special Meeting, you may vote with respect to the proposals in person via the virtual meeting platform at the Special Meeting, or by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided.

 

28

A: Yes. Whether you plan to attend the Special Meeting or not, please read the enclosed proxy statement/prospectus/consent solicitation statement carefully, and vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided.

non-discretionary

non-discretionary

non-vote.”

non-votes

Q: How will a broker impact the results of each proposal?

non-votes

A: Yes. You may change your vote by sending a later-dated, signed proxy card to our Secretary at the address listed below so that it is received by our Secretary prior to the Special Meeting or attend the Special Meeting in person via the virtual meeting platform and vote. You also may revoke your proxy by sending a notice of revocation to our Secretary, which must be received by our Secretary prior to the Special Meeting.

A: You may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus/consent solicitation statement and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast your vote with respect to all of your shares.

 

29

A: If you have questions about the proposals or if you need additional copies of this proxy statement/prospectus/consent solicitation statement or the enclosed proxy card you should contact:

Gores Metropoulos II, Inc.

6260 Lookout Road,

Boulder, CO 80301

531-3100

Email: jchou@gores.com

You may also contact the proxy solicitor for the Company at:

Morrow Sodali LLC

470 West Avenue

Stamford, Connecticut 06902

662-5200

658-9400

Email: GMII.info@investor.morrowsodali.com

To obtain timely delivery, Company stockholders must request the materials no later than [●], 2021, or five business days prior to the Special Meeting.

If you intend to seek redemption of your Public Shares, you will need to send a letter demanding redemption and deliver your Public Shares (either physically or electronically) to the Transfer Agent prior to the Special Meeting in accordance with the procedures detailed under the question “How do I exercise my redemption rights?” If you have questions regarding the certification of your position or delivery of your Public Shares, please contact the Transfer Agent:

Computershare Trust Company, N.A.

520 Pike Street, Suite 1305

Seattle, WA 98101

Attention: Joe Campbell

Email: joseph.campbell@computershare.com

 

30

non-binding

Annex A

The Sonder Stockholders are encouraged to return their written consent as soon as possible after carefully reviewing this proxy statement/prospectus/consent solicitation statement and its Annexes.

 

31

C-1

C-1

D-1

D-1

On April 29, 2021, the Company and the Sonder Supporting Stockholders with a sufficient number of votes to achieve the Sonder Requisite Approval entered into Voting and Support Agreements, pursuant to which, among other things, such Sonder Stockholders agreed to vote their shares of Sonder Stock in favor of adopting the Merger Agreement and approving the transactions contemplated thereby, including the Business Combination. Sonder will solicit the written consent of Sonder Stockholders, including the Supporting Sonder Stockholders, to adopt the Merger Agreement and approve the transactions contemplated thereby, including the Business Combination, prior to the consummation of the Business Combination.

Annex L

Annex L

non-consenting

The parties intend for the Mergers to be treated as an integrated transaction and together to constitute a single “reorganization” within the meaning of Section 368(a) of the U.S. Tax Code for U.S. federal income tax purposes. Provided that the Mergers qualify as a reorganization, no gain or loss will generally be recognized by a U.S. holder of Sonder Stock for U.S. federal income tax purposes on the exchange of its shares of Sonder Stock for Common Stock (including any Earn Out Shares) in the First Merger, except, in each case, with respect to cash received in lieu of fractional shares and imputed interest.

 

32

non-U.S.

A: If you have any questions about the Business Combination or how to execute your written consent electronically or if you need additional copies of this proxy statement/prospectus/consent solicitation statement or a replacement written consent, you should contact Wilson Sonsini, Sonder’s legal advisor, at aminor@wsgr.com.

 

33

 

34

•

First Merger Sub will merge with and into Sonder, with Sonder continuing as the Surviving Corporation of the First Merger;

•

immediately following the First Merger and as part of the same overall transaction as the First Merger, the Surviving Corporation will merge with and into Second Merger Sub, with Second Merger Sub continuing as the Surviving Entity of the Second Merger;

•

in connection with the Business Combination, we will adopt the proposed Amended and Restated Certificate of Incorporation effective prior to the effective time of the First Merger;

•

in connection with the Business Combination, holders of shares of Sonder Common Stock (following the conversion of each issued and outstanding share of Sonder Preferred Stock and the Sonder Convertible Notes into shares of Sonder Common Stock prior to the effective time of the First Merger) will be entitled to receive a number of shares of newly-issued Common Stock equal to the Per Share Sonder Common Stock Consideration for each such share of Sonder Common Stock held by such holder immediately prior to the effective time of the First Merger. Holders of shares of Sonder Special Voting Common Stock will be entitled to receive a number of shares of newly-issued Post-Combination Company Special Voting Common Stock equal to the Per Share Sonder Special Voting Stock Consideration for each such share of Sonder Special Voting Common Stock held by such holder immediately prior to the effective time of the First Merger;

•

in connection with the Business Combination, each Sonder Stock Option, to the extent then outstanding and unexercised, will automatically be converted into an option, subject to the same terms and conditions

 

35

as were applicable to the corresponding Sonder Stock Option prior to the closing of the Business Combination, to acquire a number of shares of Common Stock (rounded down to the nearest whole share) equal to (i) the number of shares of Sonder Common Stock subject to the Sonder Stock Option immediately prior to the effective time of the First Merger multiplied by (ii) the Option Exchange Ratio (rounded down to the nearest whole number of shares of Common Stock), at a per share exercise price equal to (x) the per share exercise price of the Sonder Stock Option immediately prior to the effective time of the First Merger divided by (y) the Option Exchange Ratio (rounded up to the nearest whole cent);

•

at the closing of the Business Combination, the Registration Rights Holders will enter into the Registration Rights Agreement, pursuant to which, (a) any (i) outstanding share of Common Stock or any Private Placement Warrants, (ii) shares of Common Stock issued or issuable upon the conversion of the Class F Stock and upon exercise of the Private Placement Warrants, and (iii) shares of Common Stock issued as Earn Out Shares or issuable upon the conversion of any Earn Out Shares, in each case, held by the Sonder Stockholders, and (b) any other equity security of the Company issued or issuable with respect to any such share of Common Stock by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise, will be entitled to registration rights; and

•

following the closing of the Business Combination, the foregoing consideration to be paid to the Sonder equityholders may be further increased by amounts payable in respect of Earn Out Shares, of up to an aggregate of 14,500,000 shares of Common Stock.

 

36

(1)	For more information about the ownership interests of our Initial Stockholders, including our Sponsor, prior to the Business Combination, please see the section titled “ Beneficial Ownership of Securities .”

 

37

(2)	Sonder Group Holdings LLC owns 100% of the common shares of Sonder Canada Inc., which carry 100% of the voting rights. Canadian shareholders of Sonder Canada Inc. own non-voting exchangeable shares constituting less than 30% of the total shares outstanding of Sonder Canada Inc.

 

38

(1)	For more information about the ownership interests of our Initial Stockholders, including our Sponsor, following the Business Combination, please see the section titled “ Beneficial Ownership of Securities. ”

(2)	The PIPE Investors’ ownership percentage includes 4,000,000 shares of Class A Stock to be purchased under the Sponsor Subscription Agreement, and such shares are consequently excluded from the Initial Stockholders’ ownership percentage.

 

39

(3)

The ownership interests of the Sonder Stockholders (i) include the Rollover Options, assuming an Option Exchange Ratio equal to the Per Share Sonder Common Stock Consideration and excluding any additional Discounted Earn Out Option Amount, which will be determined on or prior to the consummation of the Business Combination (please see the section titled “ Summary—Treatment of Sonder Equity Awards ”), and (ii) reflect the exercise of all outstanding Sonder warrants and the conversion of all outstanding Sonder convertible notes into Common Stock in connection with the consummation of the Business Combination.

(4)	For more information about the ownership interests of the Sonder equityholders following the Business Combination, please see the section titled “ Beneficial Ownership of Securities .”

(5)

These ownership percentages assume (i) no exercise of redemption rights by our Public Stockholders, (ii) no issuance of Earn Out Shares, (iii) inclusion of the Rollover Options calculated on the basis described in note (3) above, and (iv) the exercise of all outstanding Sonder warrants and conversion of Sonder convertible notes into Common Stock.

(7)	Sonder Group Holdings LLC owns 100% of the common shares of Sonder Canada Inc., which carry 100% of the voting rights. Canadian shareholders of Sonder Canada Inc. own nonvoting exchangeable shares constituting less than 30% of the total shares outstanding of Sonder Canada Inc.

 

40

•

the applicable waiting period(s) under the HSR Act (and any extensions thereof, including any agreement with a governmental authority to delay consummation of the Business Combination) in respect of the Business Combination shall have expired or been terminated;

•

there shall not have been enacted or promulgated any governmental order, statute, rule or regulation enjoining or prohibiting the consummation of the Business Combination;

•

the Company shall have at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) remaining after the completion of the redemption offer and prior to the closing of the First Merger;

•

the approval by the Company Stockholders of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal and the Director Election Proposal shall have been obtained;

•

the Sonder Requisite Approval to adopt the Merger Agreement and approve the transactions contemplated thereby, including the Business Combination, shall have been obtained;

•

the Canadian Approvals shall have been delivered;

•

the Common Stock to be issued in connection with the Business Combination (including the Common Stock to be issued pursuant to the earn out) shall have been approved for listing on Nasdaq, subject only to the requirement to have a sufficient number of round lot holders and official notice of listing; and

•

the registration statement, of which this proxy statement/prospectus/consent solicitation statement is a part, shall have become effective under the Securities Act and no stop order suspending the effectiveness of the registration statement, of which this proxy statement/prospectus/consent solicitation statement is a part, shall have been issued and no proceedings for that purpose shall have been initiated or threatened by the SEC and not withdrawn.

 

41

•

(i) the representations and warranties of the Company, First Merger Sub and Second Merger Sub (other than the representations and warranties of the Company, First Merger Sub and Second Merger Sub, with respect to corporate organization, due authorization, the Trust Account, brokers’ fees and capitalization) shall be true and correct (without giving effect to any limitation as to “materiality,” “material adverse effect” or any similar limitation) as of the date of the Merger Agreement and as of the closing date of the Business Combination as though then made (except to the extent such representations and warranties expressly relate to an earlier date, and in such case, shall be true and correct on and as of such earlier date), except, where the failure of such representations and warranties to be so true and correct, individually or in the aggregate, has not had, and would not reasonably be expected to result in, a material adverse effect on the Company, First Merger Sub and Second Merger Sub, taken as a whole, or a material adverse effect on the Company’s, First Merger Sub’s and Second Merger Sub’s ability to consummate the Business Combination, including the Mergers, and (ii) the representations and warranties of the Company, First Merger Sub and Second Merger Sub with respect to corporate organization, due authorization, the Trust Account, brokers’ fees and capitalization, shall be true and correct (without giving effect to any limitation as to “materiality,” “material adverse effect” or any similar limitation) in all material respects as of the date of the Merger Agreement and as of the closing date of the Business Combination as though then made (except to the extent such representations and warranties expressly relate to an earlier date, and in such case, shall be true and correct on and as of such earlier date);

•

each of the covenants of the Company to be performed or complied with as of or prior to the closing of the Business Combination shall have been performed or complied with in all material respects;

•

the receipt of a certificate signed by the chief executive officer of the Company certifying that the conditions in the two preceding bullets have been satisfied;

•

the Current Company Certificate shall be amended and restated in the form of the Amended and Restated Certificate of Incorporation; and

•

the Company shall have Closing Cash equal to or exceeding $500,000,000. “ Closing Cash ” as used in herein means the amount equal to: (i) the funds contained in the Trust Account as of the effective time of the First Merger; plus (ii) all other cash and cash equivalents of the Company; plus (iii) the amount delivered to the Company at or prior to the closing in connection with the consummation of the PIPE Investment; minus (iv) the aggregate amount of cash proceeds that will be required to satisfy the redemption of any shares of Class A Stock (to the extent not already paid).

•

(i) certain representations and warranties of Sonder with respect to due incorporation and the representations and warranties of Sonder with respect to due incorporation, due authorization, capitalization, brokers’ fees and affiliate arrangements shall be true and correct (without giving any effect to any limitation as to “materiality” or “Material Adverse Effect” or any similar limitation) in all material respects as of the date of the Merger Agreement and as of the closing date of the Business Combination as though then made (except to the extent such representations and warranties expressly

 

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relate to an earlier date, and in such case, shall be true and correct on and as of such earlier date), (ii) the representations and warranties of Sonder with respect to the lack of a Material Adverse Effect shall be true and correct in all respects as of the date of the Merger Agreement and as of the closing date of the Business Combination as though then made, and (iii) all other representations and warranties of Sonder shall be true and correct (without giving any effect to any limitation as to “materiality” or “Material Adverse Effect” or any similar limitation) as of the date of the Merger Agreement and as of the closing date of the Business Combination as though then made (except to the extent such representations and warranties expressly relate to an earlier date, and in such case, shall be true and correct on and as of such earlier date), except, where the failure of such representations and warranties to be so true and correct, individually and in the aggregate, has not had, and would not reasonably be expected to result in, a Material Adverse Effect;

•

each of the covenants of Sonder to be performed or complied with as of or prior to the closing of the Business Combination shall have been performed or complied with in all material respects; and

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the receipt of a certificate signed by an officer of Sonder certifying that the conditions in the two preceding bullets have been satisfied.

 

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•

Ability to Transform the Hospitality Industry on a Global Scale . Our Board noted that Sonder’s strategic, technological and operational performance, along with its partnerships with artists, architects and significant technology investments, allow it to leverage technology and design across the value chain, creating a unique brand providing high quality and tech-enabled experiences to consumers and suppliers at a compelling value within the $800 billion addressable lodging market.

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Resiliency in Adverse Economic Conditions. Our Board noted the resiliency of Sonder’s business model during the COVID-19 pandemic, which allowed Sonder to significantly outperform the hotel industry and outperform its competitors. Additionally, our Board considered Sonder’s strong performance in generating direct bookings since the beginning of the COVID-19 pandemic.

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Market Leadership. Our Board took into account Sonder’s market leadership in the hospitality industry, noting Sonder’s existing platform and long-term growth potential compared favorably to its competition. Our Board also recognized that a number of Sonder’s historic competitors recently exited the market, creating more whitespace for growth.

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Significant, Long-Term Growth Potential. Our Board took into account the upside involved in investing in technology to enhance guest experiences and cost structures, which Sonder has already integrated and continues to refine across multiple markets in countries around the world. The Board believed this would position Sonder to deepen its reach in existing markets and reach unpenetrated markets that represent opportunities for growth. Further, our Board took into account that younger customer demographics inclined to use Sonder’s app-based interface represent a large and growing part of the traveler base. Our Board additionally noted that Sonder plans to further its geographic expansion and to extend into additional product categories, such as vacation and resort destinations, a franchising model and a software solution for third party operators.

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Vertical Integration of Hospitality Services Drives Exceptional Economics and Value for Customers and Suppliers . Our Board noted that Sonder uses its innovative technology in an end-to-end model where it controls nearly every facet of its guests’ experiences with a vertically integrated business (using technology solutions for, among other things, revenue forecasting, real estate underwriting, supply chain, distribution, revenue management, housekeeping and customer service), reducing operating costs by as much as 50% compared to traditional hotels and bringing service to a customer’s phone through Sonder’s app, which produces customer satisfaction scores of approximately 70% across Sonder’s locations. Our Board also noted that Sonder’s real estate partners also benefit through cost efficiencies driven by Sonder’s technology and operational capabilities, increasing cash flows for real estate partners while offloading operational responsibilities to allow real estate developers to better monetize their assets while delivering better and more modern hospitality service to Sonder’s guests.

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Proven Leadership Team with Deep Technology, Operations and Hospitality Experience. Our Board noted that the Sonder management team has deep technology, operations and hospitality experience, and that the management team is expected to remain with Sonder upon the closing of the Business Combination. Additionally, our Board believes that Sonder’s proven management team and strategy will help enable Sonder to deliver continued strategic growth.

 

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•

Opinion of our Financial Advisor. Our Board took into account the opinion of Moelis, dated April 29, 2021, addressed to our Board as to the fairness, from a financial point of view and as of the date of such opinion, of the consideration to be paid by us in the Business Combination, which opinion was based on and subject to the assumptions made, procedures followed, matters considered and limitations and qualifications set forth in such opinion as more fully described under the caption “ The Business Combination—Opinion of the Company’s Financial Advisor .”

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Other Alternatives. Our Board believed, after a review of other business combination opportunities reasonably available to the Company, that the proposed Business Combination represents the best potential business combination for us based upon the process utilized to evaluate and assess other potential acquisition targets. Our Board and our management also believed that such processes had not presented a better alternative.

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Due Diligence. Our Board took into account the results of our due diligence investigation of Sonder conducted by our management team and our financial and legal advisors.

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Stockholder Approval. Our Board considered the fact that, in connection with the Business Combination, our stockholders have the option to (i) remain stockholders of the Company, (ii) sell their shares of Class A Stock or (iii) redeem their shares of Class A Stock for the per share amount held in the Trust Account pursuant to the terms of the Current Company Certificate.

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Negotiated Terms of the Merger Agreem ent . Our Board considered the terms and conditions of the Merger Agreement and the transactions contemplated thereby, including the Business Combination.

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Independent Director Role. Our Board is comprised of a majority of independent directors who are not affiliated with our Sponsor and its affiliates, including The Gores Group and Dean Metropoulos. In connection with the Business Combination, our independent directors, Messrs. Randall Bort, Michael Cramer and Joseph Gatto, took an active role in evaluating the proposed terms of the Business Combination, including the Merger Agreement, the Related Agreements and the amendments to the Current Company Certificate to take effect in connection with the Business Combination, and unanimously approved, as members of our Board, the Merger Agreement and the transactions contemplated thereby, including the Business Combination.

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Benefits May Not Be Achieved. The risk that the potential benefits of the Business Combination may not be fully achieved, or may not be achieved within the expected timeframe.

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Stockholder Vote. The risk that our stockholders may fail to provide the votes necessary to effect the Business Combination.

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Redemption Risk. The risk that a significant number of our stockholders may elect to redeem their shares prior to the consummation of the Business Combination pursuant to the Current Company Certificate, which may potentially make the Business Combination more difficult to complete.

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Closing Conditions. The fact that consummation of the Business Combination is conditioned on the satisfaction of certain closing conditions that are not within our control.

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Litigation. The possibility of litigation challenging the Business Combination or that an adverse judgment granting permanent injunctive relief could indefinitely enjoin consummation of the Business Combination.

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Fees and Expenses. The fees and expenses associated with completing the Business Combination.

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Liquidation of the Company. The risks and costs to us if the Business Combination is not completed, including the risk of diverting management focus and resources from other initial business combination

 

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opportunities, which, if the Business Combination is not consummated, could result in us being unable to effect an initial business combination by January 22, 2023 and force us to liquidate and the Public Warrants to expire worthless.

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Other Risks. Various other risks associated with the Business Combination, the business of Sonder and ownership of the Post-Combination Company’s shares described under the section titled “ Risk Factors .”

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Interests of Certain Persons. Some of our officers and directors may have interests in the Business Combination as individuals that are in addition to, and that may be different from, the interests of our stockholders (see the section titled “ The Business Combination—Interests of Certain Persons in the Business Combination—Interests of the Company Initial Stockholders and the Company’s Other Current Officers and Directors ”). Our independent directors reviewed and considered these interests during the negotiation of the Business Combination and in evaluating and unanimously approving, as members of our Board, the Merger Agreement and the Business Combination.

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Evaluation of Alternative Transactions. It is the belief of the Sonder Board, after review of alternative strategic opportunities from time to time, including strategic transactions with other partners and the possibility of, and benefits and risks associated with, continuing to operate Sonder as a privately held entity, that the proposed Business Combination represents the best potential transaction for Sonder to create greater value for the Sonder Stockholders, while also providing greater liquidity for the Sonder Stockholders by owning stock in a public company.

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Terms of the Merger Agreement. The Sonder Board considered the terms and conditions of the Merger Agreement, including, but not limited to, the nature and scope of the closing conditions and the likelihood of obtaining any necessary approvals, in addition to the transactions contemplated thereby, including the Mergers.

 

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•

Consideration Received by Sonder Stockholders. The Sonder Board considered the amount of consideration to be received by the Sonder Stockholders in the proposed Mergers under the terms and conditions of the Merger Agreement.

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Size of Post-Combination Company. The Sonder Board considered the implied enterprise value of approximately $2.2 billion for Sonder at the closing of the Business Combination, providing the Sonder Stockholders with the opportunity to go forward with ownership in a public company with a larger market capitalization.

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Access to Capital. The Sonder Board considered the current industry trends and market conditions affecting Sonder and the cost of alternative means of raising capital and expects that the Business Combination would be a more time- and cost-effective means to access capital and potentially repay its existing indebtedness than other options considered.

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Benefit from Being a Public Company. The Sonder Board believes that as a newly public company, Sonder will have the flexibility and financial resources to pursue and execute a growth strategy to increase revenue and stockholder value and will benefit from being publicly traded, and can effectively utilize the broader access to capital and public profile that are associated with being a publicly traded company.

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Opportunity to Increase Earnings and Expand Prospects. The Sonder Board considered the financial condition, historical results of operations, and business and strategic objectives of Sonder, as well as the risks involved in achieving those objectives, and believes that the Business Combination will create an opportunity for Sonder to increase future earnings and cultivate superior prospects.

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Insider Letters. The Sonder Board considered that, pursuant to the letter agreements entered into with the Company, each of Messrs. Alec E. Gores, Dean Metropoulos, Randall Bort, Michael Cramer, Joseph Gatto and Andrew McBride (collectively, the “ Insiders ”) and the Sponsor, the Insiders and the Sponsor agreed to, among other things, vote all of the shares of the capital stock of the Company they hold to approve the Business Combination Proposal at the Special Meeting and not to redeem such shares in connection with the transactions contemplated by the Merger Agreement.

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Primary Lock-Up Agreements . The Sonder Board also considered that in connection with the consummation of the Mergers, the Company, Sonder and certain Sonder Stockholders who will receive Common Stock will enter into Primary Lock-Up Agreements. Under the Primary Lock-Up Agreements, such stockholders will agree not to, subject to certain exceptions, without the prior written consent of the Post-Combination Company Board, (i) sell or otherwise dispose of, or agree to sell or dispose of, any shares of Common Stock held by the stockholder immediately after the effective time of the Mergers or any shares of Common Stock issuable upon the exercise of options, warrants or other convertible securities to purchase shares of Common Stock held by the stockholder immediately after the effective time of the Mergers (the “ Lock-Up Shares ”), (ii) enter into any arrangement that transfers to another any of the economic consequences of ownership of any of such Lock-Up Shares, or (iii) publicly announce any intention to effect any transaction specified in clause “(i)” or “(ii)” above for 180 days after the closing date of the Mergers; provided, if during such period the volume weighted average price of Common Stock for 10 trading days within any 20 consecutive trading day period is at least $12.50 per share or $15.00 per share, then following achievement of each such price, one-third of the shares of Common Stock owned by the Sonder Stockholder will no longer be subject to such transfer restrictions in the Primary Lock-Up Agreements (not to occur earlier than 90 days following the consummation of the Business Combination).

•

Conversion Share Lock-Up Agreements. The Sonder Board also considered that, in connection with the consummation of the Mergers, the Company, Sonder and Sonder Noteholders who will receive Common Stock will enter into Conversion Share Lock-Up Agreements. Under the Conversion Share Lock-Up Agreements, such Sonder Noteholders will agree to be bound by restrictions on the transfer of

 

49

their Conversion Shares until the earlier of (i) 180 days after the consummation of the Business Combination or (ii) the date that the resale registration statement on Form S-1 registering the PIPE Shares is declared effective by the SEC.

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Registration Rights Agreement. The Sonder Board also considered that, in connection with the consummation of the Mergers, the Company, the Sponsor, Sonder, certain Company stockholders and certain Sonder Stockholders who will receive Common Stock will enter into the Registration Rights Agreement. Under the Registration Rights Agreement, the Post-Combination Company will agree to provide to such stockholders and their permitted transferees with certain registration rights, including, among other things, customary “demand” and “piggyback” registration rights, with respect to their shares of Common Stock, including shares issued as Earn Out Shares or issuable upon the conversion of certain Earn Out Shares (as defined in the Merger Agreement), and Private Placement Warrants, subject to certain requirements and customary conditions. The Registration Rights Agreement will also provide that the Post-Combination Company will pay certain expenses relating to such registrations and indemnify the Registration Rights Holders against (or make contributions in respect of) certain liabilities which may arise under the Securities Act. For a more detailed description of the Registration Rights Agreement, see the section titled “ The Merger Agreement and Related Agreements—Registration Rights Agreement. ”

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Risk that the Business Combination may not be completed . The Sonder Board considered the risk that the Business Combination might not be consummated in a timely manner or at all, due to a lack of stockholder approval or failure to satisfy various conditions to closing.

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Effects on reputation, business and employees if the Business Combination is not completed. The Sonder Board considered the possibility that there may be an adverse effect on Sonder’s reputation, business and employees upon the public announcement of the agreement to enter into the Merger Agreement or in the event the Business Combination is not completed.

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Expenses and challenges . The Sonder Board considered the expenses to be incurred in connection with the Business Combination and related administrative challenges associated with combining the companies.

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Costs of being a public company . The Sonder Board considered the additional public company expenses and obligations that Sonder’s business will be subject to following the closing of the Business Combination that it has not previously been subject to as a private company.

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Restrictions on operation of Sonder’s business prior to the closing. The Sonder Board considered the fact that, although Sonder will continue to exercise, consistent with the terms and conditions of the Merger Agreement, control and supervision over its operations prior to the closing of the Business Combination, the Merger Agreement generally obligates Sonder, subject to the Company’s prior consent (which consent may not be unreasonably withheld, conditioned or delayed), to conduct its business during the period prior to the closing of the Business Combination in the ordinary course of business consistent with past practice and in accordance with specified restrictions, which might delay or prevent Sonder from undertaking certain business opportunities that might arise prior to the closing of the Business Combination.

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Interests of Sonder executive officers and directors . The Sonder Board considered the fact that certain executive officers and directors of Sonder have interests in the Business Combination that may be different from, or in addition to, the interests of the Sonder Stockholders generally, including the manner in which they would be affected by the Business Combination. For more information, see the section titled “ Interests of Certain Persons in the Business Combination—Interests of the Sonder Officers and Directors .”

 

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•

Other risks . The Sonder Board considered various other risks associated with the Business Combination, including the risks described in the section titled “ Risk Factors .”

 

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1.

Business Combination Proposal —To consider and vote upon a proposal to approve the Merger Agreement, a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex A , and the transactions contemplated thereby, including, among other things, the Business Combination (Proposal No. 1);

2.

Nasdaq Proposal —To consider and vote upon a proposal to approve, for purposes of complying with applicable Nasdaq listing rules, the issuance of Common Stock and Post-Combination Company Special Voting Common Stock constituting more than 20% of the Company’s issued and outstanding shares of Common Stock or other securities convertible into or exercisable for common stock in connection with the Business Combination (Proposal No. 2);

3.

Charter Proposal —To consider and act upon a proposal to adopt the proposed Amended and Restated Certificate of Incorporation in the form attached hereto as Annex B (Proposal No. 3);

4.

Governance Proposals —To consider and act upon, on a non-binding advisory basis, a separate proposal with respect to certain governance provisions in the Amended and Restated Certificate of Incorporation in accordance with SEC requirements (Proposal No. 4);

5.

Management Equity Incentive Plan Proposal —To consider and vote upon a proposal to approve the Management Equity Incentive Plan, including the authorization of the initial share reserve under the Incentive Plan (Proposal No. 5);

6.

Incentive Plan Proposal —To consider and vote upon a proposal to approve the Incentive Plan, including the authorization of the initial share reserve under the Incentive Plan (Proposal No. 6);

7.

ESPP Proposal – To consider and vote upon a proposal to approve the ESPP, including the authorization of the initial share reserve under the ESPP (Proposal No. 7);

 

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8.

Director Election Proposal —To consider and vote upon a proposal to elect four directors to serve on the Company’s Board until the earlier of the consummation of the Business Combination and the 2023 annual meeting of stockholders, and until their respective successors are duly elected and qualified (Proposal No. 8); and

9.

Adjournment Proposal —To consider and vote upon a proposal to allow the chairman of the Special Meeting to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if there are insufficient votes for, or otherwise in connection with, the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal, the Management Equity Incentive Plan Proposal, the Incentive Plan Proposal, the ESPP Proposal or the Director Election Proposal but no other proposal if the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposal, the Management Equity Incentive Plan Proposal, the Incentive Plan Proposal, the ESPP Proposal and the Director Election Proposal are approved (Proposal No. 9).

 

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•

the fact that our Initial Stockholders have agreed not to redeem any of the Founder Shares in connection with a stockholder vote to approve a proposed initial business combination;

•

the fact that our Sponsor paid an aggregate of $25,000 for 11,500,000 Founder Shares and (after giving effect to the cancellation of 250,000 Founder Shares on March 7, 2021) the remaining 11,250,000 Founder Shares will have a significantly higher value at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $112.5 million but, given the restrictions on such shares, we believe such shares have less value;

•

the fact that our Initial Stockholders have agreed to waive their rights to liquidating distributions from the Trust Account with respect to their Founder Shares if we fail to complete an initial business combination by January 22, 2023;

•

the fact that our Sponsor paid an aggregate of approximately $11,000,000 for its 5,500,000 Private Placement Warrants to purchase shares of Class A Stock, and that such Private Placement Warrants will expire worthless if an initial business combination is not consummated by January 22, 2023;

 

55

•

the continued right of our Sponsor to hold our Class A Stock and the shares of Class A Stock to be issued to our Sponsor upon exercise of its Private Placement Warrants following the Business Combination, subject to certain lock-up periods;

•

the fact that if the Trust Account is liquidated, including in the event we are unable to complete an initial business combination within the required time period, our Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per public share, or such lesser per public share amount as is in the Trust Account on the liquidation date, by the claims of prospective target businesses with which we have entered into an acquisition agreement or claims of any third party (other than our independent public accountants) for services rendered or products sold to us, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the Trust Account;

•

the continued indemnification of our existing directors and officers and the continuation of our directors’ and officers’ liability insurance after the Business Combination;

•

the fact that, in exchange for serving on the Board, each of our independent directors, Messrs. Bort, Cramer, and Gatto, received a nominal economic interest through the transfer from our Sponsor of 25,000 Founder Shares at their original purchase price of $0.002 per share. If the Company fails to complete an initial business combination by January 22, 2023, these Founder Shares will become worthless. As a result, our independent directors may have a conflict of interest in determining whether a particular business is an appropriate business with which to effectuate the Company’s initial business combination;

•

the fact that our Sponsor, officers and directors will lose their entire investment in us and will not be reimbursed for any out-of-pocket expenses if an initial business combination is not consummated by January 22, 2023;

•

the fact that our Sponsor, officers and directors would hold the following number of shares in the Post-Combination Company at the closing of the Business Combination:

(1)	Assumes a value of $10.00 per share, the deemed value of the Common Stock in the Business Combination.

•

the fact that, at the closing of the Business Combination, we will enter into the Registration Rights Agreement with the Registration Rights Holders, which provides for registration rights to Registration Rights Holders and their permitted transferees;

•

the fact that we entered into a Subscription Agreement with our Sponsor, pursuant to which our Sponsor has committed to purchase 4,000,000 shares of Class A Stock (which will be reclassified into Common Stock upon the effectiveness of the Amended and Restated Certificate of Incorporation) in the PIPE Investment for an aggregate commitment of approximately $40,000,000, provided that our

 

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Sponsor has the right to syndicate the Class A Stock (which will be reclassified into Common Stock upon the effectiveness of the Amended and Restated Certificate of Incorporation) purchased under such Sponsor Subscription Agreement in advance of the closing of the Business Combination; and

•

the fact that we will reimburse our Sponsor for the fees and expenses it incurs in connection with the Business Combination.

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Certain of Sonder’s executive officers hold shares of Sonder Stock, the treatment of which is described in the section titled “ Proposal No. 1 — The Business Combination Proposal. ” Please see the section titled “ Beneficial Ownership of Securities ” for more information regarding the shares of Sonder Stock held by Sonder’s executive officers.

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Certain of Sonder’s executive officers and non-employee directors hold restricted stock units and/or options to purchase shares of Sonder Common Stock, which will be assumed by the Company upon the consummation of the Business Combination. The treatment of such equity awards in connection with the Business Combination is described in the section titled “ Proposal No. 1 — The Business Combination Proposal. ” Please see the section titled “ Beneficial Ownership of Securities ” for more information regarding the shares of Sonder Stock held by Sonder’s executive officers and non-employee directors.

•

The non-employee directors of Sonder have a direct or indirect ownership interest in Sonder Stock, which are described in the section titled “ Beneficial Ownership of Securities .”

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Sonder’s executive officers will be eligible to receive equity grants under the Management Equity Incentive Plan, under which 14,500,000 shares of Common Stock may be awarded. One-sixth of the share pool becomes available for issuance based on (including prior to but contingent on) the

 

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occurrence of each of six distinct triggering events, which occur if the stock price of the Common Stock is equal to or greater than $13.00, $15.50, $18.00, $20.50, $23.00, or $25.50, respectively, within the five year period after the expiration of the lock up period. For additional information, please see the section titled “ Proposal No. 5—The Management Equity Incentive Plan Proposal .”

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Sonder’s Chief Executive Officer, Francis Davidson, has agreed to sell 1,829,268 shares of Common Stock acquired in connection with the Business Combination to certain purchasers immediately following the consummation of the Business Combination for $8.20 per share for the purpose of satisfying personal tax liabilities related to his stock ownership and departure tax related to his move from Canada to the United States. The sales are conditioned upon the consummation of the Business Combination.

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Certain of Sonder’s directors and executive officers are expected to become directors and/or executive officers of the Post-Combination Company upon the consummation of the Business Combination. Specifically, the following individuals who are currently executive officers of Sonder are expected to become executive officers of the Post-Combination Company upon the consummation of the Business Combination, serving in the offices set forth opposite their names below.

Name		Position
Francis Davidson		Chief Executive Officer and Director
Sanjay Banker		President and Chief Financial Officer
Nicole LaFlamme		Vice President of Human Resources
Satyen Pandya		Chief Technology Officer
Ritesh Patel		Vice President, Corporate Controller
Martin Picard		Global Head of Real Estate
Philip Rothenberg		General Counsel and Secretary

•

In addition, the following individuals who are currently directors of Sonder are expected to become directors of the Post-Combination Company upon the consummation of the Business Combination: Manon Brouillette, Francis Davidson, Nabeel Hyatt and Frits Dirk van Paasschen.

•

At the closing of the Business Combination, the Company will enter into the Registration Rights Agreement with the Registration Rights Holders (in which certain members of Sonder’s Board and affiliates are included), which provides for registration rights to Registration Rights Holders and their permitted transferees.

 

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Name		Age				Position
Dean Metropoulos			74			Chairman
Alec Gores			68			Chief Executive Officer and Director
Andrew McBride			40			Chief Financial Officer and Secretary
Randall Bort			56			Director
Michael Cramer			68			Director
Joseph Gatto			63			Director