TradeUP Acquisition Corp. (UPTD) Merger with Estrella Biopharma, Inc. (Private)

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October 5, 2022

  • TradeUP Acquisition Corp. (UPTD) to acquire Estrella Biopharma, Inc (Private).
  • Estimated pro forma equity value of ~$398.5 million.
  • Estrella Biopharma shareholders will receive 32.5 million shares of UPTD common stock at $10.00/share as merger consideration.
  • Transaction includes completion of financing before closing of at least $20 million by TradeUP or Estrella Biopharma where equity financing should not be less than $15 million & debt financing should not be more than $5 million.
  • Minimum Net closing cash condition of $20 million.
  • Estrella Biopharma shall deposit an extension fee in the trust account on failure to merge by termination date in exchange of a promissory note (for the same) from TradeUP.
  • The transaction is expected to close in the first half of 2023.
  • SPAC Details:
    • Unit Structure: 1 share of Common Stock + 0.5 Redeemable Warrant
    • #Cash in Trust: $45,459,609 (102.6% of public offering)
    • Public Shares outstanding: 4.43 million
    • Private shares outstanding: 1.42 million (including 0.31 Private Placement shares) 
    • Reported Trust Value/Share: $10.26
    • Liquidation Date: January 19, 2023
  • Name of Target: Estrella Biopharma, Inc.
  • Target Description: Estrella, a Delaware corporation, is a preclinical-stage biopharmaceutical company developing CD19 and CD22-targeted ARTEMIS® T-cell therapies with the capacity to address treatment challenges for patients with blood cancers and solid tumors. Estrella’s mission is to harness the evolutionary power of the human immune system to transform the lives of patients fighting cancer.
  • Announced Date: October 3, 2022
  • Expected Close: “First Half of 2023”
  • Press Release: https://www.sec.gov/Archives/edgar/data/1844417/000157587222000912/rc003_ex99-1.htm
  • Transaction Terms (N/A):
    • Enterprise Value: N/A
    • Market Cap Value:  $398.5 million
    • Target Shareholders Receive (~81.6%):
      • 32,500,000 shares of UPTD Common Stock at $10 per share
  • PIPE / Financing:
    • None
  • Redemption Protections:
    • None
  • Support Agreement:
    • Standard voting support
  • Lock-up:
    • SPAC Sponsor: 6 months post-closing
      • Early Release (50%): If equal or above $12.50 per share after closing
    • Target stockholders (Holdings>5%): 6 months post-closing
      • Early Release (50%): If equal or above $12.50 per share after closing
  • Closing Conditions:
    • Termination date: January 19, 2023
    • Minimum Net Closing Cash of $20 million
    • Transaction financing of at least $20 million by either SPAC or Target
      • Equity financing should not be less than $15 million
      • Debt financing should not be more than $5 million
    • Other customary closing conditions
  • Termination:
    • Target shall deposit extension fee in the trust account on failure to merge by termination date & shall receive a promissory note for the same from SPAC
      • Payable at Target’s option at closing
      • In Cash or Convertible into shares of SPAC Common stock at $10 per share
    • Other standard termination clauses
  • Advisors:
    • SPAC Financial Advisor: US Tiger Securities, Inc.
    • SPAC Legal Advisors: Robinson & Cole LLP
    • Target Legal Advisors: Winston & Strawn LLP
  • Financials (N/A):
    • No historical or projected financials provided
  • Comparables (N/A):
    • No Valuations provided
  • Equity Incentive Plan:
    • 10% of shares outstanding post-closing
    • Includes evergreen provision of 5% annually

*Denotes estimated figures by CPC

#Reported as on September 30, 2022