Table of Contents

As confidentially submitted to the Securities and Exchange Commission on August 3, 2021. This draft registration statement has not been filed publicly with the Securities and Exchange Commission and all information herein remains strictly confidential.

No. 333-                    

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

ALTIMAR ACQUISITION CORP. II*

(Exact name of registrant as specified in its charter)

 

 

 

 

Cayman Islands*   6770   98-1571400

(State or other jurisdiction of

incorporation or organization)

 

(Primary Standard Industrial

Classification Code Number)

 

(I.R.S. Employer

Identification No.)

40 West 57th Street

33rd Floor

New York, NY 10019

(212) 287-6767

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

 

 

Tom Wasserman

40 West 57th Street

33rd Floor

New York, NY 10019

(212) 287-6767

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

Copies of all communications, including communications sent to agent for service, should be sent to:

 

Ariel J. Deckelbaum, Esq.

Raphael M. Russo, Esq.

Paul, Weiss, Rifkind,

Wharton & Garrison LLP

1285 Avenue of the Americas New York,

NY 10019

(212) 373-3000

 

Steven J. Gavin, Esq.

Matthew F. Bergmann, Esq.

Winston & Strawn LLP

35 W. Wacker Drive

Chicago, IL 60601

(312) 558-5600

 

Ryan Martin

Fathom Holdco, LLC

1050 Walnut Ridge Drive

Hartland, WI 53209

(262) 367-8254

 

 

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Securities Exchange Act of 1934 (“Exchange Act”).

 

Large accelerated filer      Accelerated filer  
Non-accelerated filer      Smaller reporting company  
     Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act.  ☐

 

 

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

 

*

Immediately prior to the consummation of the Business Combination described in the proxy statement/prospectus, Altimar Acquisition Corp. II intends to effect a deregistration under the Cayman Islands Companies Act (As Revised) and a domestication under Section 388 of the Delaware General Corporation Law, pursuant to which Altimar Acquisition Corp. II’s jurisdiction of incorporation will be changed from the Cayman Islands to the State of Delaware (the “Domestication”). All securities being registered will be issued by the continuing entity following the Domestication, which will be renamed Fathom Digital Manufacturing Corporation (“Fathom”) in connection with the Business Combination, as further described in the proxy statement/prospectus. As used in this proxy statement/prospectus, the term “registrant” refers to Altimar Acquisition Corp. II (a Cayman Islands exempted company), prior to the Domestication, and to Fathom (a Delaware corporation), following the Domestication.

 

 

 


Table of Contents

CALCULATION OF REGISTRATION FEE

 

 

Title of Each Class of
Securities to be Registered
  Amount
to be
Registered(3)
  Proposed
Maximum
Offering Price
Per Unit
  Proposed
Maximum
Aggregate
Offering Price
  Amount of
Registration Fee

Class A common stock(1)

 

        

  $    (4)   $           $    (6)

Warrants to purchase Class A common stock(2)

  18,525,000   N/A   N/A(5)         (7)

Total

              $        

 

 

This registration statement relates to the registration of securities that will be issued by Fathom Digital Manufacturing Corporation, a Delaware corporation (“Fathom”), in connection with a series of transactions* that comprise the business combination described in this registration statement and the accompanying proxy statement/prospectus, including securities that may be issued in the future upon the exercise, exchange or conversion of certain of the securities issued in the business combination as described herein (the “Business Combination”).

 

1.

The number of shares of Class A common stock of Fathom being registered includes (i) 34,500,000 Class A ordinary shares that were sold pursuant to Altimar Acquisition Corp. II’s (“Altimar II”) initial public offering pursuant to its Registration Statement on Form S-1 (File No. 333-252260), each of which will automatically convert into shares of Fathom Class A common stock in the Domestication (as defined herein) and remain outstanding following the Business Combination, (ii) 8,625,000 shares of Fathom Class A common stock representing 8,625,000 shares of Altimar II Class B ordinary shares held by the Altimar II Founders (as defined herein) that will automatically convert into 8,625,000 shares of Fathom Class C common stock in connection with the Domestication, which shares will then automatically convert into 8,625,000 shares of Fathom Class A common stock, subject to forfeiture by the Altimar II Founders of a portion of their shares of Class A common stock pursuant to the Business Combination Agreement and the Forfeiture and Support Agreement as described herein, (iii)          shares of Class A common stock, reflecting an estimate of the maximum number of shares of Class A common stock that may be issued as consideration for the direct or indirect ownership interests in Fathom Holdco, LLC (“Fathom OpCo”) in connection with the Business Combination (including shares of Class A common stock that may be issued upon the exchange of units of Fathom OpCo that will be issued in the Business Combination) and (iv) 9,000,000 shares of Class A common stock to be issued as earnout consideration in the Business Combination and subject to vesting and forfeiture events under the terms of the documents governing the Business Combination.

2.

Calculated based on 8,625,000 redeemable warrants (the “Public Warrants”) and 9,900,000 redeemable warrants (the “Private Placement Warrants”), which will become warrants to acquire shares of Class A common stock in connection with the Business Combination.

3.

Pursuant to Rule 416(a) of the Securities Act of 1933, as amended (the “Securities Act”), there are also being registered an indeterminable number of additional securities as may be issued to prevent dilution resulting from share splits, share dividends or similar transactions.

4.

Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(f)(l) under the Securities Act, based on the average of the high and low prices of the Class A ordinary shares of Altimar II on the New York Stock Exchange (the “NYSE”) on             , 2021. Fathom will succeed Altimar II following the Business Combination described in this registration statement and the accompanying proxy statement/prospectus.

5.

The maximum number of Warrants are being simultaneously registered hereunder.

6.

Calculated by multiplying the proposed maximum aggregate offering price of securities to be registered by 0.0001091.

7.

No separate registration fee is required pursuant to Rule 457(g) under the Securities Act.


Table of Contents

The information in this preliminary proxy statement/prospectus is not complete and may be changed. These securities may not be issued until the registration statement filed with the U.S. Securities and Exchange Commission is effective. The preliminary proxy statement/prospectus is not an offer to sell these securities and does not constitute the solicitation of offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

PRELIMINARY — SUBJECT TO COMPLETION, DATED AUGUST 3, 2021

PROXY STATEMENT FOR EXTRAORDINARY GENERAL MEETING OF STOCKHOLDERS OF

ALTIMAR ACQUISITION CORP. II,

AND

PROSPECTUS FOR

     SHARES OF CLASS A COMMON STOCK,

18,525,000 WARRANTS TO PURCHASE SHARES OF CLASS A COMMON STOCK

ALTIMAR ACQUISITION CORP. II (AFTER ITS DOMESTICATION AS A CORPORATION

INCORPORATED IN THE STATE OF DELAWARE AND RENAMING

AS FATHOM DIGITAL MANUFACTURING CORPORATION IN CONNECTION WITH THE DOMESTICATION)

The board of directors of Altimar Acquisition Corp. II, a blank check company incorporated as a Cayman Islands exempted company (the “Company,” “Altimar II,” “we,” “us” or “our”), has unanimously approved (i) the Domestication of Altimar II as a Delaware corporation (the “Domestication”) and (ii) the Business Combination Agreement, dated as of July 15, 2021, by and among Altimar II, Fathom Holdco, LLC, a Delaware limited liability company (“Fathom OpCo”), and the other parties thereto (as may be amended from time to time, the “BCA” or the “Business Combination Agreement”), a copy of which is attached to this proxy statement/prospectus as Annex C. Fathom OpCo, doing business as “Fathom Digital Manufacturing,” is a leading on-demand digital manufacturing platform in North America, providing comprehensive product development and manufacturing services to many of the largest and most innovative companies in the world. In connection with the transactions contemplated by the Business Combination Agreement (the “Business Combination”), the Company will be renamed “Fathom Digital Manufacturing Corporation” (referred to herein as “Fathom”).

Upon consummation of the transactions contemplated by the Business Combination Agreement, the combined company will be organized in an “Up-C” structure. As part of these transactions, Altimar II will form a wholly owned subsidiary, Rapid Merger Sub, LLC (“Merger Sub”), which at the closing of the Business Combination (the “Closing”) will merge with and into Fathom OpCo (the “Merger”), with Fathom OpCo being the surviving entity of the Merger. Upon the completion of the Business Combination and as a result of the Merger, Fathom OpCo will be owned in part by former public shareholders of Altimar II and the Altimar II Founders, including Altimar Sponsor II, LLC, a Delaware limited liability company (the “Sponsor”), and in part by continuing equity owners of Fathom OpCo (the “Continuing Fathom Unitholders”).

As described in this proxy statement/prospectus, Altimar II’s shareholders are being asked to consider and vote upon (among other things) the Business Combination, the Domestication and the other proposals set forth herein.

This proxy statement/prospectus covers      shares of Class A common stock (which includes shares issuable (i) upon conversion of Altimar II’s Class B ordinary shares, subject to forfeiture by the Altimar II Founders of a portion of their shares of Class A common stock pursuant to the Business Combination Agreement and the Forfeiture and Support Agreement as described herein, (ii) as consideration for the direct or indirect ownership interests in Fathom OpCo in connection with the Business Combination (including shares of Class A common stock that may be issued upon the exchange of units of Fathom OpCo that will be issued in the Business Combination) and (iii) as earnout consideration in the Business Combination and subject to vesting and forfeiture events under the terms of the documents governing the Business Combination) and 18,525,000 Warrants to acquire shares of Class A common stock.

Altimar II’s units, public shares and Public Warrants are currently listed on the New York Stock Exchange (“NYSE”) under the symbols “ATMR.U”, “ATMR” and “ATMR.WS”, respectively. Altimar II intends to apply for listing, to be effective at the time of the Business Combination, of Fathom’s Class A common stock and warrants to purchase Class A common stock on the NYSE under the proposed symbols “FDMG” and “FDMG.WS,” respectively.

 

 

This proxy statement/prospectus provides you with detailed information about the Business Combination and other matters to be considered at the Special Meeting. We urge you to carefully read this entire document and the documents incorporated herein by reference. You should also carefully consider the risk factors described in “Risk Factors” beginning on page 49 of this proxy statement/prospectus.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the transactions described in this proxy statement/prospectus, passed upon the fairness of the BCA or the transactions contemplated thereby, or passed upon the adequacy or accuracy of this proxy statement/prospectus. Any representation to the contrary is a criminal offense.

 

 

This proxy statement/prospectus is dated                  , 2021, and is first being mailed to Altimar II’s shareholders on or about                 , 2021.


Table of Contents

ALTIMAR ACQUISITION CORP. II

A Cayman Islands Exempted Company

40 West 57th Street, 33rd Floor

New York, New York 10019

NOTICE OF EXTRAORDINARY GENERAL MEETING

TO BE HELD ON                      , 2021

TO THE SHAREHOLDERS OF ALTIMAR ACQUISITION CORP. II:

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the “Special Meeting”) of Altimar Acquisition Corp. II, a Cayman Islands exempted company (“Altimar II,” “we,” “us” or “our”), will be held at                      a.m., Eastern Time, on,                     2021. For the purposes of Altimar II’s Amended and Restated Memorandum and Articles of Association, the physical place of the meeting will be                     . In light of the novel coronavirus pandemic and to support the well-being of Altimar II’s shareholders, directors and officers, Altimar II encourages you to use remote methods of attending the Special Meeting or to attend via proxy. You may attend the Special Meeting and vote your shares electronically during the Special Meeting via live webcast by visiting                     . You will need the meeting control number that is printed on your proxy card to enter the Special Meeting. You may also attend the meeting telephonically by dialing                     . You are cordially invited to attend the Special Meeting, which will be held for the following purposes:

Proposal No. 1 — The Business Combination Proposal — to consider and vote upon a proposal to approve by ordinary resolution under Cayman Islands law and adopt the Business Combination Agreement, dated as of July 15, 2021, as amended from time to time, by and among Altimar Acquisition Corp. II, Fathom Holdco, LLC (“Fathom OpCo”) and the other parties thereto. Upon consummation of the transactions contemplated by the Business Combination Agreement, including the Domestication, substantially all of the assets and business of the combined company will be held by Fathom OpCo. Altimar II and continuing equityholders of Fathom Holdco, LLC (the “Continuing Fathom Unitholders”) will be issued Class A units of Fathom OpCo (“New Fathom Units”). Altimar II will be the managing member of Fathom OpCo. Altimar II will issue to Continuing Fathom Unitholders for cash at par value a number of shares of Class B common stock equal to the number of New Fathom Units held by the Continuing Fathom Unitholders. Altimar II’s other shareholders will hold Class A common stock of the combined company. Shares of Class A common stock will be entitled to economic rights and one vote per share and shares of Class B common stock will be entitled to one vote per share but no economic rights. The combined company’s business will continue to operate through Fathom OpCo.

Proposal No. 2 — The Domestication Proposal — to consider and vote upon a proposal to approve by special resolution under Cayman Islands law, assuming the Business Combination Proposal is approved and adopted, the change of Altimar II’s jurisdiction of incorporation from the Cayman Islands to the State of Delaware by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware (the “Domestication” and such proposal, the “Domestication Proposal”);

Proposal No. 3 — The Organizational Documents Proposal — to approve by special resolution under Cayman Islands law, assuming the Business Combination Proposal and the Domestication Proposal are approved and adopted, the amendment and restatement of the Memorandum and Articles of Association by their deletion and replacement in their entirety with the proposed new certificate of incorporation (the “Proposed Charter”) and bylaws (the “Proposed Bylaws,” and, together with the Proposed Charter, the “Proposed Organizational Documents”) of Fathom, the post-Domestication company, which, if approved, would take effect at the time of the Domestication (we refer to this proposal as the “Organizational Documents Proposal”);

Proposal No. 4 — The Advisory Charter Proposals — to approve, on a non-binding advisory basis, certain governance provisions in the Proposed Charter, which are being presented separately in accordance with United States Securities and Exchange Commission (the “SEC”) guidance to give stockholders the opportunity to present their separate views on important corporate governance provisions, as eight sub-proposals (which proposals we refer to, collectively, as the “Advisory Charter Proposals”);


Table of Contents

Advisory Charter Proposal 4A — to increase the authorized share capital from 555,000,000 shares divided into 500,000,000 Class A ordinary shares, par value $0.0001 per share (“Class A ordinary shares”), 50,000,000 Class B ordinary shares, par value $0.0001 per share (“Class B ordinary shares”), and 5,000,000 preferred shares, par value $0.0001 per share (“preferred shares”), to authorized capital stock of          shares, consisting of (i)         shares of Class A common stock, par value $0.0001 per share (“Class A common stock”), (ii)          shares of Class B common stock, par value $0.0001 per share (“Class B common stock”), (iii)          shares of Class C common stock, par value $0.0001 per share (“Class C common stock” and together with the Class A common stock and the Class B common stock, the “common stock”) and (iv) 50,000,000 shares of preferred stock;

Advisory Charter Proposal 4B — to provide that the Proposed Charter may be amended, altered or repealed, or any provision of the Proposed Charter inconsistent therewith may be adopted by (i) in the case of Articles 5, 6,7, 10 and 11 of the Proposed Charter, the affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of all the then outstanding shares of stock entitled to vote, voting together as a single class, at a meeting of the stockholders of Fathom called for that purpose and (ii) in the case of Articles 8 and 9 of the Proposed Charter, the affirmative vote of the holders of at least eighty percent (80%) of all the then outstanding shares of stock entitled to vote, voting together as a single class, at a meeting of the stockholders of Fathom called for that purpose, in each case, in addition to any other vote required by the Proposed Charter or otherwise required by law;

Advisory Charter Proposal 4C — to provide for (i) the election of directors by a plurality of the votes cast in respect of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors or, in the event that holders of any class or series of capital stock are entitled to elect one or more directors, a plurality of the votes cast by such holders, (ii) the filling of newly-created directorships or any vacancy on the board of directors by a majority vote of the remaining directors then in office, even if less than a quorum, or by a sole remaining director and (iii) the removal of directors only for cause and only upon (a) prior to the first date on which CORE and its Affiliated Companies (each as defined in the Proposed Charter) first cease to own at least 50% of the aggregate number of shares of common stock beneficially owned by CORE Industrial Partners, LLC (“CORE”) and any entity that controls, is controlled by or under common control with CORE (other than the Fathom and any company that is controlled by Fathom) and any investment funds managed by CORE (the “Affiliated Companies”) on the closing date of the Business Combination, as such number may be adjusted from time to time for any reorganization, recapitalization, stock dividend, stock split, reverse stock split or other similar changes in Fathom’s capitalization and as such number will be decreased in the event of a forfeiture of any earnout shares by CORE and its Affiliated Companies by the amount of earnout shares forfeited (the “Original Amount”), the affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of all the then outstanding shares of stock entitled to vote generally in the election of directors, voting together as a single class and (b) after the first date on which CORE and its Affiliated Companies cease to own at least 50% of the Original Amount, the affirmative vote of the holders of at least a majority of the total voting power of all the then outstanding shares of stock entitled to vote generally in the election of directors;

Advisory Charter Proposal 4D — to elect not to be governed by Section 203 of the General Corporation Law of the State of Delaware (the “DGCL”);

Advisory Charter Proposal 4E — to provide that the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction thereof, another state or federal court located within the State of Delaware, shall be the exclusive forum for certain actions and claims;

Advisory Charter Proposal 4F — to provide that each holder of record of Class A common stock, Class B common stock and Class C common stock (solely prior to the automatic conversion thereof to shares of Class A common stock as a result of the Domestication) shall be entitled to one vote per share on all matters which stockholders generally are entitled to vote;

 

ii


Table of Contents

Advisory Charter Proposal 4G — Subject to the rights of the holders of Preferred Stock and to the other provisions of applicable law and the Proposed Charter, the holders of shares of Class A common stock and, solely prior to the automatic conversion thereof upon and as a result of the Business Combination, holders of Class C common stock, in each case shall be entitled to receive ratably in proportion to the number of shares of Class A common stock and Class C common stock (as applicable) held by them such dividends and distributions (payable in cash, stock or otherwise), if any, as may be declared thereon by the Board of Directors at any time and from time to time out of any funds of Fathom legally available therefor. There will be no disparate consideration or treatment with respect to dividends and distributions, if any, declared or payable in respect of each share of the Class A common stock and Class C common stock (solely prior to the automatic conversion thereof upon and as a result of the Business Combination), on the one hand, and a New Fathom Unit, on the other hand. Dividends and other distributions shall not be declared or paid on the Class B common stock unless (i) the dividend consists of shares of Class B common stock or of rights, options, warrants or other securities convertible or exercisable into or exchangeable for shares of Class B common stock paid proportionally with respect to each outstanding share of Class B common stock and (ii) a dividend consisting of shares of Class A common stock, Class C common stock (solely prior to the automatic conversion thereof upon and as a result of the Business Combination) or of rights, options, warrants or other securities convertible or exercisable into or exchangeable for shares of Class A common stock (to the extent a similar or contemptuous dividend or distribution is not paid on the New Fathom Units) or Class C common stock (solely prior to the automatic conversion thereof upon and as a result of the Business Combination) on equivalent terms is simultaneously paid to the holders of Class A common stock and Class C common stock (solely prior to the automatic conversion thereof upon and as a result of the Business Combination). If dividends are declared on the Class A common stock, the Class B common stock or the Class C common stock (solely prior to the automatic conversion thereof upon and as a result of the Business Combination) that are payable in shares of common stock, or securities convertible into, or exercisable or exchangeable for common stock, the dividends payable to the holders of Class A common stock shall be paid only in shares of Class A common stock (or securities convertible into, or exercisable or exchangeable for Class A common stock), the dividends payable to the holders of Class B common stock shall be paid only in shares of Class B common stock (or securities convertible into, or exercisable or exchangeable for Class B common stock), the dividends payable to the holders of Class C common stock shall be paid only in shares of Class C common stock (or securities convertible into, or exercisable or exchangeable for Class C common stock), and such dividends shall be paid in the same number of shares (or fraction thereof) on a per share basis of the Class A common stock, Class B common stock and Class C common stock, respectively (or securities convertible into, or exercisable or exchangeable for the same number of shares (or fraction thereof) on a per share basis of the Class A common stock, Class B common stock and Class C common stock, respectively);

Advisory Charter Proposal 4H — to eliminate various provisions in the Existing Organizational Documents applicable only to blank check companies, including the provisions requiring that Altimar II have net tangible assets of at least $5,000,001 immediately prior to, or upon such consummation of, a business combination;

Proposal No. 5 — The Stock Issuance Proposal — to consider and vote upon a proposal to approve by ordinary resolution under Cayman Islands law, assuming the Business Combination Proposal, the Domestication Proposal and the Organizational Documents Proposal are approved and adopted, for the purposes of complying with the applicable listing rules of the New York Stock Exchange (the “NYSE”), the issuance of shares of Class A common stock to the PIPE Investors (as defined herein) pursuant to Subscription Agreements (as defined below), forms of which are attached to this proxy statement/prospectus as Annex J (we refer to this proposal as the “Stock Issuance Proposal”);

Proposal No. 6 — The Business Combination Issuance Proposal — to consider and vote upon a proposal to approve by ordinary resolution under Cayman Islands law, assuming the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal and the Stock Issuance Proposal are approved and adopted, for the purposes of complying with the applicable listing rules of the NYSE (including

 

iii


Table of Contents

any rules applicable to a “change of control”), the issuance of shares of Class A common stock, Class B common stock and Class C common stock (i) pursuant to the terms of the Business Combination Agreement, (ii) upon the exchange of New Fathom Units pursuant to the Fathom Operating Agreement and (iii) upon the conversion, in accordance with our Proposed Charter, of any such common stock issued pursuant to (i) or (ii) (we refer to this proposal as the “Business Combination Issuance Proposal”);

Proposal No. 7 — The Equity Incentive Plan Proposal — to consider and vote upon a proposal to approve by ordinary resolution, assuming the Stock Issuance Proposal and the Business Combination Issuance Proposal are approved and adopted, the Fathom Digital Manufacturing Corporation 2021 Omnibus Incentive Plan (the “2021 Omnibus Plan”), a copy of which is attached to this proxy statement/prospectus as Annex H (we refer to this proposal as the “Equity Incentive Plan Proposal”);

Proposal No. 8 The ESPP Proposal — to consider and vote upon a proposal to approve by ordinary resolution, assuming the Stock Issuance Proposal and the Business Combination Issuance Proposal are approved and adopted, the Fathom Digital Manufacturing Corporation’s 2021 Employee Stock Purchase Plan (the “ESPP”), a copy of which is attached to this proxy statement/prospectus as Annex I (we refer to this proposal as the “ESPP Proposal” and, collectively with the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal, the Stock Issuance Proposal, the Business Combination Issuance Proposal and the Equity Incentive Plan Proposal, the “Condition Precedent Proposals”); and

Proposal No. 9 The Adjournment Proposal — to consider and vote upon a proposal to approve by ordinary resolution under Cayman Islands law the adjournment of the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the Special Meeting, any of the Condition Precedent Proposals would not be duly approved and adopted by our shareholders or we determine that one or more of the closing conditions under the Business Combination Agreement is not satisfied or waived (we refer to this proposal as the “Adjournment Proposal”).

The Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal, the Stock Issuance Proposal, the Business Combination Issuance Proposal, the Equity Incentive Plan Proposal, and the ESPP Proposal, collectively, are referred to herein as the “Condition Precedent Proposals.”

Only holders of record of Altimar II’s Class A ordinary shares and Class B ordinary shares (collectively, “ordinary shares”) at the close of business on                 , 2021 are entitled to notice of and to vote and have their votes counted at the Special Meeting and any adjournment of the Special Meeting.

The resolutions to be voted upon in person or by proxy at the Special Meeting relating to the above proposals are set forth in the proxy/statement prospectus sections entitled “Proposal No. 1 — The Business Combination Proposal”, “Proposal No. 2 — The Domestication Proposal”, “Proposal No. 3 — The Organizational Documents Proposal”, “Proposal No. 4 — The Advisory Charter Proposals”, “Proposal No. 5 — The Stock Issuance Proposal”, “Proposal No. 6 — The Business Combination Issuance Proposal”, “Proposal No. 7 — The Equity Incentive Plan Proposal”, “Proposal No. 8 — The ESPP Proposal” and “Proposal No. 9 — The Adjournment Proposal”, respectively.

We will provide you with the proxy statement/prospectus and a proxy card in connection with the solicitation of proxies to be voted at the Special Meeting and at any adjournment of the Special Meeting. Whether or not you plan to attend the Special Meeting, we urge you to read when available the proxy statement/prospectus (and any documents incorporated into the proxy statement/prospectus by reference) carefully. Please pay particular attention to the section entitled Risk Factors.”

After careful consideration, Altimar II’s board of directors has determined that each of the proposals set forth above is in the best interests of Altimar II and its shareholders and unanimously recommends that you vote or give instruction to vote “FOR” each of those proposals.

 

iv


Table of Contents

The existence of financial and personal interests of Altimar II’s directors may result in a conflict of interest on the part of one or more of the directors between what he or they may believe is in the best interests of Altimar II and its shareholders and what he or they may believe is best for himself or themselves in determining to recommend that shareholders vote for the proposals. See the section entitled “The Business Combination Proposal — Interests of Altimar II Directors and Officers in the Business Combination” in the proxy statement/prospectus when it becomes available for a further discussion.

Under the Business Combination Agreement, the approval of each of the Condition Precedent Proposals is a condition to the consummation of the Business Combination. The adoption of each Condition Precedent Proposal is conditioned on the approval of all of the Condition Precedent Proposals. The Advisory Charter Proposals and the Adjournment Proposal are not conditioned on the approval of any other proposal. If our shareholders do not approve each of the Condition Precedent Proposals, the Business Combination may not be consummated.

In connection with our initial public offering, on February 4, 2021, Sponsor and our officers and directors at the time of our initial public offering entered into a letter agreement (the “IPO Letter Agreement”) pursuant to which they agreed, among other things, to vote their Class B ordinary shares purchased prior to our initial public offering (“founder shares”), as well as any Class A ordinary shares sold by us in our initial public offering (“public shares”) purchased by them during or after our initial public offering, in favor of Altimar II’s initial business combination (including the proposal recommended by Altimar II’s board of directors in connection with such business combination). Accordingly, we expect them to vote their shares in favor of all proposals being presented at the Special Meeting. In addition, pursuant to the Forfeiture and Support Agreement, dated July 15, 2021 (as amended from time to time, the “Forfeiture and Support Agreement”), the parties, agreed, among other things, effective upon the Closing that, (a) Sponsor, on behalf of itself and the other Altimar II Founders, will waive the anti-dilution adjustments set forth in Altimar II’s existing Memorandum and Articles of Association and which will be set forth in Altimar II’s Certificate of Incorporation in connection with the Business Combination, (b) the Altimar II Founders will forfeit and surrender for no additional consideration the Forfeited Shares (as defined herein) which would be received upon the automatic conversion of their shares of Class C common stock upon the Closing and (c) Sponsor, from the date of the Business Combination Agreement until the earlier of Closing or the termination of the Business Combination Agreement in accordance with its terms, will refrain from taking (and not cause Altimar II to take) any action the effect of which would be to cause Altimar II to breach its non-solicitation obligations set forth in Section 9.08 of the Business Combination Agreement. In addition, the Altimar II Founders agreed, among other things, (i) from the date of the Business Combination Agreement until the earlier of the Closing or the termination of the Business Combination Agreement in accordance with its terms, to not redeem any Class A ordinary shares (or, if applicable, shares of Altimar II Class A common stock) held by them and (ii) prior to the consummation of Business Combination or the termination of the Business Combination Agreement, to vote or cause to be voted, all of the Altimar II shares beneficially owned by the Altimar II Founders, at every meeting of the shareholders of Altimar II at which such matters are considered and at every adjournment or postponement thereof: (1) in favor of (A) the Business Combination and the Business Combination Agreement and the other transactions contemplated thereby (including any proposals recommended by Altimar II’s Board of Directors in connection with the Business Combination) and (B) any proposal to adjourn or postpone such meeting of shareholders to a later date if there are not sufficient votes to approve the Business Combination; (2) against any action, proposal, transaction or agreement that could reasonably be expected to result in a breach of any covenant, representation or warranty or any other obligation or agreement of Altimar II under the Business Combination Agreement; and (3) against (A) any proposal or offer from any person concerning (I) a merger, consolidation, liquidation, recapitalization, share exchange or other business combination transaction involving Altimar II, or (II) the issuance or acquisition of shares of capital stock or other Altimar II equity securities (other than as contemplated or permitted by the Business Combination Agreement); and (B) any action, proposal, transaction or agreement that would reasonably be expected to (x) impede the fulfillment of Altimar II’s conditions under the Business Combination Agreement or change in any manner the voting rights of any class of Altimar II’s shares or (y) result in a breach of any covenant, representation or warranty or other obligation or agreement of Sponsor or any of the other Altimar II Founders contained in the Forfeiture and Support Agreement.

 

v


Table of Contents

Pursuant to Altimar II’s Existing Organizational Documents, a holder of public shares (“Public Shareholder”) may request that Altimar II redeem all or a portion of its public shares (which would become shares of Class A common stock in the Domestication) for cash if the Business Combination is consummated. For the purposes of Article 49.3 of the Existing Organizational Documents and the Cayman Islands Companies Act (As Revised), the exercise of redemption rights shall be treated as an election to have such public shares repurchased for cash and references in the proxy statement/prospectus relating to the Business Combination shall be interpreted accordingly. You will be entitled to receive cash for any public shares to be redeemed only if you:

 

  (i)

(a) hold public shares or (b) hold units and you elect to separate your units into the underlying public shares and public warrants prior to exercising your redemption rights with respect to the public shares; and

 

  (ii)

prior to                 5:00 p.m., Eastern Time, on                 , 2021, (a) submit a written request to Continental Stock Transfer & Trust Company, Altimar II’s transfer agent (the “transfer agent”), that Altimar II redeem your public shares for cash and (b) deliver your public shares to the transfer agent, physically or electronically through Depository Trust Company (“DTC”).

Holders of units must elect to separate the underlying public shares and public warrants prior to exercising redemption rights with respect to the public shares. If holders hold their units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the units into the underlying public shares and public warrants, or if a holder holds units registered in its own name, the holder must contact the transfer agent, directly and instruct it to do so. Public shareholders may elect to redeem all or a portion of their public shares even if they vote for the Business Combination Proposal. If the Business Combination is not consummated, the public shares will not be redeemed for cash. If a Public Shareholder properly exercises its right to redeem its public shares and timely delivers its shares to the transfer agent, we will redeem each public share for a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account established in connection with our initial public offering (the “Trust Account”), calculated as of two business days prior to the consummation of the Business Combination, including interest, less income taxes payable, divided by the number of then issued and outstanding public shares. For illustrative purposes, as of                 , 2021, this would have amounted to approximately $    per public share. If a public shareholder exercises its redemption rights, then it will be exchanging its redeemed public shares for cash and will no longer own such shares. See “The Extraordinary General Meeting — Redemption Rights” in the proxy statement/prospectus for a detailed description of the procedures to be followed if you wish to redeem your public shares for cash.

Notwithstanding the foregoing, a Public Shareholder, together with any affiliate of such Public Shareholder or any other person with whom such Public Shareholder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (“Exchange Act”)), will be restricted from redeeming its public shares with respect to more than an aggregate of 15% of the public shares. Accordingly, if a Public Shareholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the public shares, then any such shares in excess of that 15% limit would not be redeemed for cash.

The total consideration to be paid to the Fathom Blocker Owners and the Continuing Fathom Unitholders (each as defined herein), including CORE Industrial Partners Fund I, LP, at the Closing shall equal the aggregate of:

 

  (a)

(i) All the cash proceeds from the Trust Account established for the purpose of holding the net proceeds of Altimar II’s initial public offering, net of any amounts paid to Altimar II’s shareholders that exercise their redemption rights in connection with the Business Combination, together with the proceeds from the PIPE Investment (as defined herein) (the “Available Cash Amount”), (ii) minus up to $25,000,000 to be contributed by Altimar II to the balance sheet of Fathom OpCo, (iii) minus up to $42,000,000 to be used to pay down certain indebtedness of Fathom OpCo, (iv) minus certain transaction expenses of Fathom OpCo and Altimar II, which include fees and expenses of various advisors, transfer taxes, employee transaction bonuses, and filing and listing fees (the “Closing Cash Consideration”);

 

vi


Table of Contents
  (b)

A number of shares of Class A common stock and newly issued Class A units of Fathom OpCo (the “New Fathom Units”) (together with one share of Class B common stock to be issued at par value for cash in respect of each New Fathom Units), to be allocated as set forth on a schedule, dated as of the Closing Date, setting forth (i) the name of each Continuing Fathom Unitholder and Fathom Blocker Owner, and (ii) the allocation of the Closing Cash Consideration, the Closing Seller Equity Consideration and the Earnout Shares at the Closing to each of the Continuing Fathom Unitholders and Fathom Blocker Owners (the “Allocation Schedule”), in an aggregate number (rounded up to the nearest whole share) equal to the quotient of (i) the result of (A) $1,200,000,000 minus (B) the Closing Cash Consideration divided by (ii) $10.00 (the “Closing Seller Equity Consideration”); and

 

  (c)

An aggregate of 9,000,000 shares of earnout equity consideration (in Class A common stock and New Fathom Units) (the “Earnout Shares”). These earnout shares will vest in three equal tranches of 3,000,000 shares, with each tranche vesting at each of the following share price thresholds: $12.50, $15.00 and $20.00, in each case subject to the vesting and forfeiture provisions set forth in the Investor Rights Agreement (as defined herein) and Fathom OpCo’s Amended and Restated Limited Liability Company Agreement (the “Fathom Operating Agreement”). The earnout period will be five years from the date of the closing of the Business Combination. The achievement of the price threshold will be determined based on a VWAP for 20 trading days within any 30-trading day period or a change of control transaction of Fathom that implies the same per share valuation as the applicable price threshold.

The Closing is subject to certain customary conditions, including, among other things: (i) the approval of the Business Combination and other matters by Altimar II’s shareholders; (ii) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and receipt of certain additional regulatory approvals; (iii) the Available Cash Amount (as defined in the Business Combination Agreement) equaling no less than $313,000,000 at the Closing (such condition, the “Available Cash Amount Condition”); (iv) (x) fundamental representations and warranties (which includes Organization, Due Authorization, Holding Company; Ownership and Brokers’ Fees) bring down conditions to an “all material respects” standard, (y) general representations and warranties bring down conditions to a “material adverse effect” standard and (z) capitalization representation bring down condition to a “de minimis” standard; (v) covenant bring down conditions to an “all material respects” standard; (vi) the absence of a material adverse effect on the respective parties; and (vii) the effectiveness of this registration statement and the listing of Fathom Class A common stock to be issued in the Business Combination on the New York Stock Exchange (“NYSE”). To the extent permitted by law, the conditions in the Business Combination Agreement may be waived by the parties thereto.

In connection with entering into the Business Combination Agreement, Altimar II and Fathom OpCo entered into subscription agreements (the “Subscription Agreements”), each dated as of July 15, 2021, with certain institutional and other accredited investors (the “PIPE Investors”), pursuant to which, among other things, the PIPE Investors party thereto agreed to purchase an aggregate of 8,000,000 shares of Class A common stock following the Domestication and immediately prior to the Closing at a cash purchase price of $10.00 per share (the “PIPE Investment”). The Subscription Agreements contain customary representations, warranties, covenants and agreements of Altimar II, Fathom OpCo and the PIPE Investors and are subject to customary closing conditions (including, without limitation, that there is no amendment or modification to the Business Combination Agreement that is material and adverse to the PIPE Investor) and termination rights (including a termination right if the transaction contemplated by the Subscription Agreement has not been consummated by December 31, 2021, other than as a result of breach by the terminating party).

All Altimar II shareholders are cordially invited to attend the Special Meeting. To ensure your representation at the Special Meeting, however, you are urged to complete, sign, date and return the proxy card accompanying the proxy statement/prospectus as soon as possible. If you are a shareholder of record holding ordinary shares, you may also cast your vote in person at the Special Meeting. If your shares are held in an account at a brokerage firm or bank, you must instruct your broker or bank on how to vote your shares or, if you

 

vii


Table of Contents

wish to attend the Special Meeting and vote in person, obtain a proxy from your broker or bank. If you do not vote or do not instruct your broker or bank how to vote, your failure to vote will have no effect on the vote count for the proposals to be voted on at the Special Meeting.

Your vote is important regardless of the number of shares you own. Whether you plan to attend the Special Meeting or not, please sign, date and return the proxy card accompanying the proxy statement/prospectus as soon as possible in the envelope provided. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted.

If you have any questions or need assistance voting your ordinary shares, please contact Innisfree M&A Incorporated, our proxy solicitor, by calling (877) 750-8129, or banks and brokers can call collect at (212) 750-5833.

Thank you for your participation. We look forward to your continued support.

 

                    , 2021   

By Order of the Board of Directors,

  

 

  

Tom Wasserman

Chief Executive Officer and Director

 

viii


Table of Contents

IF YOU RETURN YOUR PROXY CARD WITHOUT AN INDICATION OF HOW YOU WISH TO VOTE, YOUR SHARES WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS. TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST (I) IF YOU HOLD CLASS A ORDINARY SHARES THROUGH UNITS, ELECT TO SEPARATE YOUR UNITS INTO THE UNDERLYING CLASS A ORDINARY SHARES AND PUBLIC WARRANTS PRIOR TO EXERCISING YOUR REDEMPTION RIGHTS WITH RESPECT TO THE PUBLIC SHARES, (II) SUBMIT A WRITTEN REQUEST TO THE TRANSFER AGENT, THAT YOUR PUBLIC SHARES BE REDEEMED FOR CASH, AND (III) DELIVER YOUR CLASS A ORDINARY SHARES TO THE TRANSFER AGENT, PHYSICALLY OR ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT WITHDRAWAL AT CUSTODIAN) SYSTEM, IN EACH CASE IN ACCORDANCE WITH THE PROCEDURES AND DEADLINES DESCRIBED IN THIS PROXY STATEMENT/PROSPECTUS. IF THE BUSINESS COMBINATION IS NOT CONSUMMATED, THEN THE PUBLIC SHARES WILL NOT BE REDEEMED FOR CASH. IF YOU HOLD THE SHARES IN STREET NAME, YOU WILL NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BANK OR BROKER TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. SEE “THE EXTRAORDINARY GENERAL MEETING — REDEMPTION RIGHTS” IN THE PROXY STATEMENT/PROSPECTUS FOR MORE SPECIFIC INSTRUCTIONS.

This notice was mailed by Altimar II on                      , 2021.

TABLE OF CONTENTS

 

     Page  

ADDITIONAL INFORMATION

     1  

TRADEMARKS

     2  

MARKET AND INDUSTRY DATA

     2  

SELECTED DEFINITIONS

     3  

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

     10  

QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION AND THE EXTRAORDINARY GENERAL MEETING

     12  

SUMMARY

     26  

SUMMARY HISTORICAL CONDENSED FINANCIAL INFORMATION OF ALTIMAR II

     39  

SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION OF FATHOM OPCO

     40  

SUMMARY UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION OF FATHOM OPCO

     42  

COMPARATIVE HISTORICAL AND UNAUDITED PRO FORMA PER SHARE FINANCIAL INFORMATION

     46  

MARKET PRICE, TICKER SYMBOL AND DIVIDEND INFORMATION

     48  

RISK FACTORS

     49  

INFORMATION ABOUT THE PARTIES TO THE BUSINESS COMBINATION

     91  

THE BUSINESS COMBINATION AGREEMENT

     92  

THE EXTRAORDINARY GENERAL MEETING

     116  

PROPOSAL NO. 1 — THE BUSINESS COMBINATION PROPOSAL

     124  

PROPOSAL NO. 2 — THE DOMESTICATION PROPOSAL

     126  

PROPOSAL NO. 3 — THE ORGANIZATIONAL DOCUMENTS PROPOSAL

     131  

PROPOSAL NO. 4 — THE ADVISORY CHARTER PROPOSALS

     132  

PROPOSAL NO. 5 — THE STOCK ISSUANCE PROPOSAL

     141  

PROPOSAL NO. 6 — THE BUSINESS COMBINATION ISSUANCE PROPOSAL

     142  

PROPOSAL NO. 7 — THE EQUITY INCENTIVE PLAN PROPOSAL

     144  

PROPOSAL NO. 8 — THE ESPP PROPOSAL

     152  

PROPOSAL NO. 9 — THE ADJOURNMENT PROPOSAL

     157  

MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

     158  

UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

     170  

INFORMATION ABOUT ALTIMAR II

     179  

 

ix


Table of Contents
     Page  

BUSINESS OF FATHOM

     191  

ALTIMAR II’S MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     202  

FATHOM’S MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     205  

MANAGEMENT OF FATHOM OPCO PRIOR TO THE BUSINESS COMBINATION

     230  

EXECUTIVE COMPENSATION

     231  

MANAGEMENT FOLLOWING THE BUSINESS COMBINATION

     239  

BENEFICIAL OWNERSHIP

     245  

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

     247  

FATHOM INDEBTEDNESS

     252  

DESCRIPTION OF FATHOM’S CAPITAL STOCK

     254  

SECURITIES ACT RESTRICTIONS ON RESALE OF CLASS A COMMON STOCK

     271  

APPRAISAL RIGHTS

     272  

SHAREHOLDER PROPOSALS AND NOMINATIONS

     272  

SHAREHOLDER COMMUNICATIONS

     273  

VALIDITY OF COMMON STOCK

     273  

EXPERTS

     273  

WHERE YOU CAN FIND MORE INFORMATION

     274  

INDEX TO FINANCIAL STATEMENTS

     F-1  

ANNEX A — FORM OF PROPOSED CHARTER OF FATHOM DIGITAL MANUFACTURING CORPORATION

     A-1  

ANNEX B — FORM OF PROPOSED BYLAWS OF FATHOM DIGITAL MANUFACTURING CORPORATION

     B-1  

ANNEX C — BUSINESS COMBINATION AGREEMENT

     C-1  

ANNEX D — TAX RECEIVABLE AGREEMENT

     D-1  

ANNEX E — INVESTOR RIGHTS AGREEMENT

     E-1  

ANNEX F — REGISTRATION RIGHTS AGREEMENT

     F-1  

ANNEX G — FATHOM OPERATING AGREEMENT

     G-1  

ANNEX H — THE 2021 OMNIBUS PLAN

     H-1  

ANNEX I — THE ESPP

     I-1  

ANNEX J — FORMS OF SUBSCRIPTION AGREEMENTS

     J-1  

ANNEX K — EXISTING ORGANIZATIONAL DOCUMENTS OF ALTIMAR II

     K-1  

 

x


Table of Contents

ADDITIONAL INFORMATION

If you have questions about the Business Combination or the Special Meeting, or if you need to obtain copies of the enclosed proxy statement/prospectus, proxy card or other documents incorporated by reference in the proxy statement/prospectus, you may contact Altimar II’s proxy solicitor listed below. You will not be charged for any of the documents you request.

Innisfree M&A Incorporated

501 Madison Avenue, 20th Floor

New York, New York 10022

Shareholders may call toll free: (877) 750-8129

Banks and Brokers may call collect: (212) 750-5833

In order for you to receive timely delivery of the documents in advance of the Special Meeting to be held on                  , 2021, you must request the information no later than                  business days prior to the date of the Special Meeting, by                  , 2021.

For a more detailed description of the information incorporated by reference in the enclosed proxy statement/prospectus and how you may obtain it, see the section captioned “Where You Can Find More Information” of the enclosed proxy statement/prospectus.

 

1


Table of Contents

TRADEMARKS

This proxy statement/prospectus contains references to trademarks and service marks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this proxy statement/prospectus may appear without the ® or symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

MARKET AND INDUSTRY DATA

This proxy statement/prospectus includes industry position and industry data and forecasts that Altimar II and Fathom OpCo obtained or derived from internal company reports, independent third party publications and other industry data. Some data are also based on good faith estimates, which are derived from internal company analyses or review of internal company reports as well as the independent sources referred to above.

Although both Altimar II and Fathom OpCo believe that the information on which the companies have based these estimates of industry position and industry data are generally reliable, the accuracy and completeness of this information is not guaranteed and they have not independently verified any of the data from third-party sources nor have they ascertained the underlying economic assumptions relied upon therein. Statements as to industry position are based on market data currently available. While Altimar II and Fathom OpCo are not aware of any misstatements regarding the industry data presented herein, these estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading “Risk Factors” in this proxy statement/prospectus.

 

2


Table of Contents

SELECTED DEFINITIONS

When used in this proxy statement/prospectus, unless the context otherwise requires:

 

   

“Adjournment Proposal” refers to the Shareholder Proposal to be considered at the Special Meeting to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more proposals at the Special Meeting.

 

   

“Adjusted EBITDA”, a non-GAAP measure, means net losses before the impact of interest income or expense, income tax expense and depreciation and amortization, and further adjusted for the following items: stock-based compensation, transaction-related costs, and certain other non-cash and non-core items

 

   

Advisory Charter Proposals” means the eight sub-proposals to take effect upon the Closing Date if the Organizational Documents Proposal is approved, consisting of Advisory Charter Proposal 4A, Advisory Charter Proposal 4B, Advisory Charter Proposal 4C, Advisory Charter Proposal 4D, Advisory Charter Proposal 4E, Advisory Charter Proposal 4F, Advisory Charter Proposal 4G, and Advisory Charter Proposal 4H.

 

   

“Altimar II” refers to Altimar Acquisition Corp. II, a blank check company incorporated as a Cayman Islands exempted company.

 

   

“Altimar II Founders” refers to the Sponsor and the following seven members of the board of directors of Altimar II: Kevin Beebe, Payne Brown, Rick Jelinek, Roma Khanna, Michael Rubenstein, Vijay Sondhi and Michael Vorhaus and each of their respective permitted transferees and assigns.

 

   

Altimar II Stockholder Redemption” means the redemption of Public Shares by Altimar II shareholders for cash in accordance with the procedures set forth in the Amended and Restated Memorandum and Articles of Association and this proxy statement/prospectus.

 

   

“Altimar II Stockholder Redemption Ratio” means, prior to the Domestication, the quotient of (a) the aggregate number of Altimar II Class A ordinary shares redeemed in connection with the Altimar II Stockholder Redemption divided by (b) 34,500,000.

 

   

“Amended and Restated Memorandum and Articles of Association” refers to Altimar II’s Amended and Restated Memorandum and Articles of Association, effective as of February 4, 2021, attached to the proxy statement/prospectus which forms a part of this registration statement as Annex K, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

Available Cash Amount” means all the cash proceeds from the Trust Account established for the purpose of holding the net proceeds of Altimar II’s IPO, net of any amounts paid to Altimar II’s shareholders that exercise their redemption rights in connection with the Business Combination, together with the proceeds from the PIPE Investment at the Closing.

 

   

“Available Cash Amount Condition” refers to the condition in the BCA pursuant to which Available Cash Amount at the Closing shall not be less than $313.0 million.

 

   

“Balance Sheet Contribution” refers to the up to $25,000,000 contribution by Altimar II to the balance sheet of Fathom OpCo at Closing.

 

   

“BCA” or “Business Combination Agreement” refers to the Business Combination Agreement, dated as of July 15, 2021, by and among Altimar II, Fathom OpCo and the other parties thereto, substantially in the form attached to this proxy statement/prospectus as Annex C, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

“Board” refers to Altimar II’s board of directors or Fathom’s board of directors, as the context suggests.

 

3


Table of Contents
   

“Business Combination” refers to the transactions contemplated by the BCA.

 

   

Business Combination Issuance Proposal means the proposal to the be considered at the Special Meeting to approve the issuance of stock in connection with the Business Combination in order to comply with the rules of the NYSE.

 

   

“Cayman Islands Companies Act” refers to the Cayman Islands Companies Act (As Revised) of the Cayman Islands.

 

   

“Centex” refers to Centex Machine and Welding, Inc.

 

   

“Class A common stock” refers to the Class A common stock, par value $0.0001 per share, of the Company, including any shares of such Class A common stock issuable upon the exercise of any warrant or other right to acquire shares of such Class A common stock.

 

   

“Class B common stock” refers to the Class B common stock, par value $0.0001 per share, of the Company, including any shares of such Class B common stock issuable upon the exercise of any right to acquire shares of such Class B common stock.

 

   

“Class C common stockrefers to the Class C common stock, par value $0.0001 per share, of the Company, including any shares of such Class C common stock issuable upon the exercise of any right to acquire shares of such Class C common stock.

 

   

“Closing” refers to the closing of the Business Combination.

 

   

“Closing Cash Consideration” means (i) the Available Cash Amount, (ii) minus up to $25,000,000 to be contributed by Altimar II to the balance sheet of Fathom OpCo, (iii) minus up to $42,000,000 to be used to pay down certain indebtedness of Fathom OpCo , and (iv) minus certain transaction expenses of Fathom OpCo and Altimar II, which include fees and expenses of various advisors, transfer taxes, employee transaction bonuses, and filing and listing fees.

 

   

“Closing Seller Equity Consideration” means a number of shares of Class A common stock and New Fathom Units (together with one share of Class B common stock to be issued at par value for cash in respect of each New Fathom Units), to be allocated as set forth on the Allocation Schedule (as defined in the Business Combination Agreement), in an aggregate number (rounded up to the nearest whole share) equal to the quotient of (i) the result of (A) $1,200,000,000 minus (B) the Closing Cash Consideration divided by (ii) $10.00.

 

   

“common stock” refers to shares of the Class A common stock, the Class B common stock and the Class C common stock, collectively.

 

   

“Company,” “our,” “we” or “us” refers, prior to the consummation of the Business Combination, to Altimar II or Fathom OpCo, as the context suggests, and, following the Business Combination, to Fathom.

 

   

“Continuing Fathom Unitholders” refers to equity owners of Fathom OpCo that continue to hold equity in Fathom OpCo following the Merger.

 

   

“CORE Investors” refers to CORE Industrial Partners Fund I, L.P. and CORE Industrial Partners Fund I Parallel, L.P.

 

   

Dahlquist refers to Dahlquist Machine, Inc.

 

   

“Debt Pay-Down Amount” refers to amount of the indebtedness of Fathom OpCo to be paid down at the Closing.

 

   

“DGCL” refers to the Delaware General Corporation Law, as amended.

 

   

“dollars” or $” refers to U.S. dollars.

 

   

“Domestication” refers to the continuation of Altimar II by way of domestication of Altimar II into a Delaware corporation, with the ordinary shares of Altimar II becoming shares of common stock of the

 

4


Table of Contents
 

Delaware corporation under the applicable provisions of the Cayman Islands Companies Act and the DGCL; the term includes all matters and necessary or ancillary changes in order to effect such Domestication, including the adoption of the Proposed Charter (substantially in the form attached hereto as Annex A, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms) consistent with the DGCL and changing the name and registered office of Altimar II.

 

   

“Domestication Proposal” refers to the Shareholder Proposal to be considered at the Special Meeting to approve the Domestication.

 

   

“Earnout Shares” means (a) a number of shares of Class A common stock and New Fathom Units, in the aggregate equal to 3,000,000, subject to a $12.50 volume weighted average price vesting threshold as set forth in the Investor Rights Agreement or Fathom Operating Agreement, as applicable, (b) a number of shares of Class A common stock and New Fathom Units, in the aggregate equal to 3,000,000, subject to a $15.00 volume weighted average price vesting threshold as set forth in the Investor Rights Agreement or Fathom Operating Agreement, as applicable, and (c) a number of shares of Class A common stock and New Fathom Units, in the aggregate equal to 3,000,000, subject to a $20.00 volume weighted average price vesting threshold as set forth in the Investor Rights Agreement or Fathom Operating Agreement, as applicable, in each case, to be allocated as set forth on the Allocation Schedule in the BCA.

 

   

“Equity Incentive Plan Proposal” means the proposal to be considered at the Special Meeting to approve and adopt the 2021 Omnibus Plan.

 

   

“ESPP” refers to Fathom Digital Manufacturing Corporation’s 2021 Employee Stock Purchase Plan (the “ESPP”), substantially in the form attached to this proxy statement/prospectus as Annex I, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

“ESPP Proposal” means the proposal to be considered at the Special Meeting to approve and adopt the ESPP.

 

   

“Fathom” refers to Fathom Digital Manufacturing Corporation, a Delaware corporation and the combined company following the consummation of the Business Combination, and its consolidated subsidiaries.

 

   

“Fathom Blocker Owners” means CORE Industrial Partners Fund I Parallel, LP, Siguler Guff Small Buyout Opportunities Fund III, LP, Siguler Guff Small Buyout Opportunities Fund III (F), LP, Siguler Guff Small Buyout Opportunities Fund III (C), LP, Siguler Guff Small Buyout Opportunities III (UK), LP, Siguler Guff HP Opportunities Fund II, LP, and Siguler Guff Americas Opportunities Fund, LP.

 

   

“Fathom OpCo” refers to Fathom Holdco, LLC, a Delaware limited liability company.

 

   

“Fathom Operating Agreement” refers to the Second Amended and Restated Limited Liability Company Agreement of Fathom Holdco, LLC, to be entered into by and among Fathom OpCo and the other parties thereto, as it may be amended from time to time (substantially in the form attached hereto as Annex G, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms).

 

   

“Forfeiture and Support Agreement” refers to the Forfeiture and Support Agreement, dated as of July 15, 2021, by and among Altimar Sponsor II, LLC, the other Altimar II Founders party thereto, Altimar Acquisition Corp. II, Fathom and the other parties thereto.

 

   

“Forfeited Shares” means the number of shares of Class A common stock determined by the following: (i) if the Altimar II Stockholder Redemption Ratio is less than or equal to 0.10, then the number shall equal zero, (ii) if the Altimar II Stockholder Redemption Ratio is greater than 0.10 and less than to 0.40, then the number shall equal the product of (A) the Redemption Forfeiture Ratio multiplied by (B) the number of shares of Class C common stock outstanding immediately following

 

5


Table of Contents
 

the Domestication and (iii) if the Altimar Stockholder Redemption Ratio is greater than or equal to 0.40, then the number shall equal the product of (A) 0.15 multiplied by (B) the number of shares of Class C common stock outstanding immediately following the Domestication. “Forfeited Shares” shall have a correlative meaning to “Forfeiture” for purposes of this proxy statement/prospectus.

 

   

“Founder shares” refers to the Class B ordinary shares of Altimar II held by the Altimar II Founders.

 

   

“GAAP” refers to United States generally accepted accounting principles, consistently applied.

 

   

GPI” refers to GPI Prototype & Manufacturing Services, LLC.

 

   

Incodema” refers to Incodema Holdings, Inc.

 

   

“Investor Rights Agreement” refers to the Investor Rights Agreement, to be entered into by and among Fathom and the other parties thereto, substantially in the form attached to this proxy statement/prospectus as Annex E, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

“IPO” refers to Altimar II’s initial public offering of its Units, Public Shares and Public Warrants pursuant to the IPO registration statement, completed on February 9, 2021.

 

   

“Laser” refers to Laser Manufacturing, Inc.

 

   

“Legacy Fathom Owners” means, collectively, the Fathom Blocker Owners and the Continuing Fathom Unitholders.

 

   

Majestic Metals” refers to Majestic Metals, LLC.

 

   

Mark Two” refers to Mark Two Engineering, LLC.

 

   

“Merger” refers to the merger at the Closing of Merger Sub with and into Fathom OpCo, with Fathom OpCo as the surviving entity.

 

   

“Merger Sub” refers to Rapid Merger Sub, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II.

 

   

“Micropulse West” refers to Sureshot Precision, LLC d/b/a Micropulse West.

 

   

“New Credit Agreement” means the new credit agreement entered into on July 9, 2021, by Fathom OpCo, certain lenders, and JPMorgan Chase Bank, N.A., as administrative agent thereunder

 

   

“New Fathom Units” has the meaning given to the term “Class A Units” in the Fathom Operating Agreement.

 

   

Newchem” refers to NewChem, Inc.

 

   

“NYSE” refers to the New York Stock Exchange.

 

   

Organizational Documents Proposal” means the proposal to be considered at the Special Meeting to approve the amendment and restatement of the Memorandum and Articles by their deletion and replacement with the Proposed Charter and the Proposed Bylaws.

 

   

“PIPE Investment” means the private placement pursuant to which PIPE Investors have committed to make a private investment in the aggregate amount of $80,000,000 in public equity in the form of Class A common stock following the Domestication and immediately prior to the Closing on the terms and conditions set forth in the Subscription Agreements.

 

   

“PIPE Investors” refers to the investors that have signed Subscription Agreements.

 

   

“PIPE Securities” refers to the shares of Class A common stock to be sold to the PIPE Investors pursuant to the Subscription Agreements.

 

   

“PPC” refers to Precision Process Corp.

 

   

“Private Placement Warrants” refers to the warrants acquired by our Sponsor in a private placement simultaneously with the closing of the IPO (including ordinary shares issuable upon conversion thereof).

 

6


Table of Contents
   

“Pro Forma Adjusted EBITDA” a non-GAAP measure, means pro forma net loss before the impact of interest income or expense, income tax expense or benefit and depreciation and amortization, and further adjusted for the same items as Adjusted EBITDA.

 

   

Proposed Bylaws” refers to the bylaws of Fathom Digital Manufacturing Corporation following the Closing, substantially in the form attached to this proxy statement/prospectus as Annex B, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

Proposed Charter” refers to the charter of Fathom Digital Manufacturing Corporation following the Closing, substantially in the form attached to this proxy statement/prospectus as Annex A, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

“Public Shareholders” refers to the holders of the Public Shares or Public Warrants that were sold in the IPO.

 

   

“Public Shares” refers to the Class A ordinary shares of Altimar II, par value $0.0001 per share, issued in the IPO.

 

   

“Public Warrants” refers to the warrants issued in the IPO, entitling the holder thereof to purchase one of Altimar II’s Class A ordinary shares at an exercise price of $11.50, subject to adjustment.

 

   

“record date” refers to                 , 2021, the date for determining the Altimar II shareholders entitled to receive notice of and to vote at the Special Meeting.

 

   

“Redemption Forfeiture Ratio” means 0.15 multiplied by the quotient of (a) the result of (i) the Altimar II Stockholder Redemption Ratio minus (ii) 0.10, divided by (b) 0.30.

 

   

“Redemption Rights” refer to the rights of the Altimar II Public Shareholders to demand redemption of their Public Shares for cash in accordance with the procedures set forth in the Amended and Restated Memorandum and Articles of Association and this proxy statement/prospectus.

 

   

“Registration Rights Agreement” refers to the Registration Rights Agreement, to be entered into by and among Fathom and the other parties thereto, substantially in the form attached to this proxy statement/prospectus as Annex F, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

“SEC” refers to the U.S. Securities and Exchange Commission.

 

   

“Securities Act” refers to the Securities Act of 1933, as amended.

 

   

Shareholder Proposals refer, collectively, (i) the Business Combination Proposal, (ii) the Domestication Proposal, (iii) the Organizational Documents Proposal, (iv) the Advisory Charter Proposals, (v) the Business Combination Issuance Proposal, (vi) the Business Combination Issuance Proposal, (vii) the Equity Incentive Plan Proposal, (viii) the ESPP Proposal and (ix) the Adjournment Proposal.

 

   

Special Meeting refers to the extraordinary general meeting of the shareholders of Altimar II to be held on                  at                  a.m., New York City Time, to vote on matters relating to the Business Combination. The Special Meeting will take place via live webcast at                  and telephonically by dialing                 . For the purposes of Altimar II’s Amended and Restated Articles of Association, the physical place of meeting will be                 .

 

   

“Sponsor” refers to Altimar II Sponsor II, LLC, a Delaware limited liability company.

 

   

Summit” refers to Summit Tooling, Inc., and Summit Plastics, LLC a Delaware corporation and limited liability company, collectively.

 

   

“Subscription Agreements” refers to the subscription agreements, dated as of July 15, 2021, by and among Altimar II, Fathom OpCo and the PIPE Investors, pursuant to which Altimar II has agreed to issue an aggregate of 8,000,000 shares of Class A common stock to the PIPE Investors immediately following the Domestication and before the Closing at a purchase price of $10.00 per share, substantially in the form attached to this proxy statement/prospectus as Annex J, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

7


Table of Contents
   

“Tax Receivable Agreement” or “TRA” refers to the Tax Receivable Agreement to be entered into by and among Fathom, Fathom OpCo and the other parties thereto at the Closing substantially in the form attached to this proxy statement/prospectus as Annex D, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

“Transfer agent” refers to Continental Stock Transfer & Trust Company.

 

   

“Trust Account” refers to the trust account of Altimar II which holds the net proceeds from the IPO and certain of the proceeds from the sale of the Private Placement Warrants, together with interest earned thereon, less amounts released to pay taxes.

 

   

“2021 Term Loan” means Fathom OpCo’s $172 million term loan from JPMorgan Chase Bank, N.A., as lender and administrative agent

 

   

“2021 Omnibus Plan” refers to the Fathom Digital Manufacturing Corporation 2021 Omnibus Incentive Plan, substantially in the form attached to this proxy statement/prospectus as Annex H, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

 

   

“Voting and Support Agreements” means the Voting and Support Agreements entered into on July 15, 2021, between Altimar II and Rapid Merger Sub, on the one hand, and various direct and indirect holders of equity in Fathom OpCo.

 

   

“Warrant Agent” refers to Continental Stock Transfer & Trust Company.

 

   

“Warrants” refers to the Public Warrants and the Private Placement Warrants of Altimar II.

Many of the terms used in this proxy statement/prospectus, including Adjusted EBITDA and Pro Forma Adjusted EBITDA, may not be comparable to similarly titled measures used by other companies. Further, Adjusted EBITDA and Pro Forma Adjusted EBITDA are not measures of performance calculated in accordance with GAAP. We use Adjusted EBITDA and Pro Forma Adjusted EBITDA as measures of operating performance, not as measures of liquidity. They should not be considered in isolation or as substitutes for operating income, net income, operating cash flows or other income or cash flow statement data prepared in accordance with GAAP. The use of these measures without consideration of related GAAP measures is not adequate due to the adjustments described above. Our management compensates for these limitations by using non-GAAP measures as supplemental measures to our GAAP results. We present these measures to provide a more complete understanding of our performance as our management measures it. Amounts and percentages throughout this proxy statement/prospectus may reflect rounding adjustments and consequently totals may not appear to sum. For reconciliations of non-GAAP measures used by Fathom OpCo to Fathom OpCo’s GAAP results, see “Fathom OpCo’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Reconciliation of Consolidated GAAP Financial Measures to Certain Non-GAAP Measures”.

Share Calculations and Ownership Percentages

Unless otherwise specified, the share calculations and ownership percentages set forth in this proxy statement/prospectus with respect to the ownership of Fathom immediately following the completion of the Business Combination are for illustrative purposes only and assume the following:

 

  1.

The PIPE Investors acquire 8,000,000 shares of Class A common stock in connection with the Closing, for an aggregate purchase price of $80 million, reflecting the full anticipated gross proceeds of the PIPE Investment.

 

  2.

No Altimar II Public Shareholders exercise their redemption rights in connection with the Business Combination and as a result of the foregoing assumption, no Class A common stock will be forfeited by the Altimar II Founders.

 

  3.

The balance of the Trust Account as of the Closing is, and (as a result of the foregoing assumptions) the available proceeds from the Trust Account are, approximately $345 million. As a result, the Available Cash Amount is equal to approximately $425 million.

 

8


Table of Contents
  4.

The Debt Pay-Down Amount (i.e., amount of the indebtedness of Fathom OpCo to be paid down at the Closing from funds in the Trust Account) is equal to $22 million.

 

  5.

The Balance Sheet Contribution is equal to $25 million.

 

  6.

None of the Warrants have been exercised and no shares of Class A common stock reserved for issuance under the proposed 2021 Omnibus Plan and the ESPP Plan have been issued.

 

  7.

No New Fathom Units have been exchanged for Class A common stock (with a corresponding surrender of an equal number of shares of Class B common stock) in accordance with the terms of such securities.

 

  8.

Earnout Shares and Sponsor Earnout Shares are not vested.

As a result of the assumptions set forth above:

 

   

The Closing Cash Consideration would be equal to $318 million;

 

   

The Closing Seller Equity Consideration would be comprised of an aggregate of          shares of Class A common stock and New Fathom Units (with each holder of New Fathom Units receiving an equal number of voting shares of Class B common stock); and

 

   

Holders of Altimar II Class B ordinary shares immediately prior to the Closing would receive an aggregate of 8,625,000 shares of Class A common stock in connection with the Closing (with 1,267,500 of those shares of Class A common stock constituting Sponsor Earnout Shares (as defined herein)), and no shares of Class C common stock will remain outstanding following the Closing.

 

9


Table of Contents

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements made in this proxy statement/prospectus and in any document incorporated by reference herein are “forward looking statements.” Statements regarding the potential combination and expectations regarding the combined business are “forward looking statements.” In addition, words such as “estimates,” “projected,” “expects,” “estimated,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “would,” “future,” “propose,” “target,” “goal,” “objective,” “outlook” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of the parties, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include:

 

   

our ability to complete the Business Combination, or, if we do not consummate the Business Combination, any other initial business combination;

 

   

the inability to complete the transactions contemplated by the proposed Business Combination due to the failure to satisfy any conditions to Closing, including the failure to obtain certain approvals of Altimar II’s shareholders or to satisfy the Available Cash Amount Condition;

 

   

the occurrence of any event, change or other circumstances that could give rise to the termination of the BCA, including the failure to satisfy any of the conditions to Closing in the BCA;

 

   

the projected financial information, anticipated growth rate and market opportunity of Fathom;

 

   

our success in retaining or recruiting, or changes required in, our officers, key employees or directors following the Business Combination;

 

   

our directors and officers potentially having conflicts of interest with our business or in approving the Business Combination, as a result of which they would receive compensation;

 

   

intense competition and competitive pressures from other companies in the digital manufacturing industry in which the combined company will operate;

 

   

factors relating to the business, operations and financial performance of Fathom, including market conditions and global and economic factors beyond Fathom’s control;

 

   

the impact of COVID-19 and related significant market volatility on our business, our industry and the global economy;

 

   

costs related to the Business Combination;

 

   

the effect of legal, tax and regulatory changes; and

 

   

other factors detailed under the section entitled “Risk Factors.

The forward-looking statements contained in this proxy statement/prospectus and in any document incorporated by reference herein are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors” in this proxy statement/prospectus, in our registration statement on Form S-1 filed in connection with our IPO and any other documents we file or have filed with the SEC, including under Item 1A. Risk Factors of the Form 10-Q for the quarter ended March 31, 2021 filed with the SEC on June 1, 2021. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material

 

10


Table of Contents

respects from those projected in these forward-looking statements. We may face additional risks and uncertainties that are not presently known to us, or that we deem to be immaterial, which may also impair our business, financial condition or prospects. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. All subsequent written and oral forward-looking statements concerning the Business Combination or other matters addressed in this proxy statement/prospectus and attributable to Altimar II, Fathom or Fathom OpCo or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this proxy statement/prospectus. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Before you grant your proxy or instruct how your vote should be cast or vote on the Shareholder Proposals to be put to vote at the Special Meeting, you should be aware that the occurrence of the events described in the “Risk Factors” section and elsewhere in this proxy statement/prospectus may adversely affect Altimar II, Fathom OpCo or Fathom following the consummation of the Business Combination.

 

11


Table of Contents

QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION

AND THE EXTRAORDINARY GENERAL MEETING

The following are answers to certain questions that you may have regarding the Business Combination and the shareholder meeting. We urge you to read carefully the remainder of this proxy statement/prospectus because the information in this section may not provide all the information that might be important to you in determining how to vote. Additional important information is also contained in the annexes to this proxy statement//prospectus.

QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION

 

Q:

WHAT IS THE BUSINESS COMBINATION?

 

A:

Altimar II and Fathom OpCo have entered into the Business Combination Agreement, dated as of July 15, 2021, pursuant to which, among other things:

 

  (a)

Altimar II will change its jurisdiction of incorporation by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation under the laws of the State of Delaware (the “Domestication”), upon which Altimar II will change its name to “Fathom Digital Manufacturing Corporation.”

 

  (b)

Fathom OpCo will issue managing member interests in Fathom OpCo to Altimar II in exchange for a nominal cash payment;

 

  (c)

Following step (b) above, (i) Rapid Blocker 1 Merger Sub, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II (“Blocker Merger Sub 1”) will merge with and into CORE Fund I Blocker-5 LLC, a Delaware limited liability company (“Fathom Blocker 1”), with Fathom Blocker 1 as the surviving company (“Surviving Fathom Blocker 1”), (ii) Rapid Blocker 2 Merger Sub, LLC , a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II (“Blocker Merger Sub 2”) will merge with and into CORE Fund I Blocker-2 LLC, a Delaware limited liability company (“Fathom Blocker 2”), with Fathom Blocker 2 as the surviving company (“Surviving Fathom Blocker 2”), and (iii) Rapid Blocker 3 Merger Sub, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II (“Blocker Merger Sub 3” and, together with Blocker Merger Sub 1 and Blocker Merger Sub 2, the “Blocker Merger Subs”) will merge with and into SG (MCT) Blocker, LLC, a Delaware limited liability company (“Fathom Blocker 3” and, together with Fathom Blocker 1 and Fathom Blocker 2, collectively, the “Fathom Blockers”), with Fathom Blocker 3 as the surviving company (“Surviving Fathom Blockers”);

 

  (d)

Immediately following step (c) above, in a sequential order, (i) the Surviving Fathom Blocker 1 will merge with and into Altimar II, with Altimar II as the surviving company, (ii) the Surviving Fathom Blocker 2 will merge with and into Altimar II, with Altimar II as the surviving company, and (iii) the Surviving Fathom Blocker 3 will merge with and into Altimar II, with Altimar II as the surviving company (collectively, the “Blocker Altimar Mergers”); and

 

  (e)

Immediately following the Blocker Altimar Mergers, Rapid Merger Sub will merge with and into Fathom OpCo (the “Fathom Merger”), with Fathom OpCo as the surviving entity of the Fathom Merger (Fathom OpCo, in its capacity as the surviving entity of the Fathom Merger, is sometimes referred to as the “Fathom Surviving Entity”). Following the Fathom Merger, the Fathom Surviving Entity will be owned by Altimar II and all other holders of Fathom OpCo units outstanding as of immediately prior to the Fathom Merger (such other holders, excluding Altimar II, are referred to as the “Continuing Fathom Unitholders”).

 

    

Upon consummation of the transactions contemplated by the Business Combination Agreement, the combined company will be organized in an “Up-C” structure, in which substantially all of the assets and business of the combined company will be held by Fathom OpCo. Altimar II and the Continuing Fathom

 

12


Table of Contents
  Unitholders will be issued Class A units of Fathom OpCo (“New Fathom Units”). Altimar II will be the managing member of Fathom OpCo. Altimar II will issue to Continuing Fathom Unitholders for cash at par value a number of shares of Class B common stock equal to the number New Fathom Units held by the Continuing Fathom Unitholders. Altimar II’s other stockholders will hold Class A common stock of the combined company. Shares of Class A common stock will be entitled to economic rights and one vote per share and shares of Class B common stock will be entitled to one vote per share but no economic rights. The combined company’s business will continue to operate through Fathom OpCo.

 

    

Altimar II will hold the Special Meeting to, among other things, obtain the approvals required for the Business Combination and the other transactions contemplated by the Business Combination Agreement and you are receiving this proxy statement/prospectus in connection with such meeting. See “The Business Combination Agreement” beginning on page 91. In addition, a copy of the Business Combination Agreement is attached to this proxy statement/prospectus as Annex C. We urge you to read carefully this proxy statement/prospectus and the Business Combination Agreement in their entirety.

 

Q:

WHY AM I RECEIVING THIS DOCUMENT?

 

A:

Altimar II is sending this proxy statement /prospectus to its shareholders to help them decide how to vote their shares of Altimar II ordinary shares with respect to the matters to be considered at the Special Meeting.

 

    

The Business Combination cannot be completed unless Altimar II’s shareholders approve the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal, the Stock Issuance Proposal, the Business Combination Issuance Proposal, the Equity Incentive Plan Proposal and the ESPP Proposal set forth in this proxy statement/prospectus. Information about the Special Meeting, the Business Combination and the other business to be considered by shareholders at the Special Meeting is contained in this proxy statement/prospectus.

 

    

This document constitutes a proxy statement of Altimar II and a prospectus of Altimar II. It is a proxy statement because the board of directors of Altimar II is soliciting proxies using this proxy statement/prospectus from its shareholders. It is a prospectus because Altimar II, in connection with the Business Combination, is offering shares of Class A common stock in exchange for its outstanding Class A ordinary shares and as part of the consideration to be received as part of the Business Combination. See “The Business Combination Agreement — Consideration to be Received in the Business Combination”.

 

Q:

WHAT WILL ALTIMAR II EQUITYHOLDERS OWN AS A RESULT OF THE BUSINESS COMBINATION?

 

A:

Following completion of the Business Combination, Altimar II’s Public Shareholders will own approximately 25% of the fully-diluted common equity of Fathom (assuming that no shares of Altimar II’s Class A ordinary shares are elected to be redeemed by Altimar Public Shareholders and subject to the other assumptions set forth in “Unaudited Pro Forma Combined Financial Information). Assuming maximum redemptions by Altimar II Public Shareholders and subject to the other assumptions set forth in “Unaudited Pro Forma Combined Financial Information”, Altimar II’s non-redeeming Public Shareholders will own approximately 17% of the fully-diluted common equity of Fathom following the Business Combination.

 

13


Table of Contents
Q:

WHAT EQUITY STAKE WILL CURRENT ALTIMAR II EQUITYHOLDERS AND CONTINUING FATHOM UNITHOLDERS HOLD IN FATHOM IMMEDIATELY AFTER THE CONSUMMATION OF THE BUSINESS COMBINATION?

 

A:

The following table summarizes the pro forma economic ownership of Class A common stock of Fathom following the Business Combination. For additional information, including the assumptions underlying the no redemptions and maximum redemptions scenarios presented below, see “Unaudited Pro Forma Combined Financial Information.”

 

     Assuming
No
Redemptions
    Assuming
Maximum
Redemptions
 

Altimar II Public Shareholders

     25.0 %     17.0

Altimar II Founders

     5.3     4.7 %

PIPE Investors

     5.8     5.8 %

Legacy Fathom Owners

     63.9     72.5 %
  

 

 

   

 

 

 

Total

     100.0     100.0 %
  

 

 

   

 

 

 

 

Q:

WHAT WILL FATHOM EQUITYHODLERS RECEIVE IN THE BUSINESS COMBINATION?

 

A:

The total consideration to be paid to CORE Industrial Partners Fund I Parallel, LP, Siguler Guff Small Buyout Opportunities Fund III, LP, Siguler Guff Small Buyout Opportunities Fund III (F), LP, Siguler Guff Small Buyout Opportunities Fund III (C), LP, Siguler Guff Small Buyout Opportunities III (UK), LP, Siguler Guff HP Opportunities Fund II, LP, and Siguler Guff Americas Opportunities Fund, LP (collectively, the “Fathom Blocker Owners”) and the Continuing Fathom Unitholders, including CORE Industrial Partners Fund I, LP, at the Closing shall equal the aggregate of:

 

  (a)

(i) All the cash proceeds from the Trust Account established for the purpose of holding the net proceeds of Altimar II’s initial public offering, net of any amounts paid to Altimar II’s shareholders that exercise their redemption rights in connection with the Business Combination, together with the proceeds from the PIPE Investment (as defined herein) (the “Available Cash Amount”), (ii) minus up to $25,000,000 to be contributed by Altimar II to the balance sheet of Fathom OpCo, (iii) minus up to $42,000,000 to be used to pay down certain indebtedness of Fathom OpCo, (iv) minus certain transaction expenses of Fathom OpCo and Altimar II, which include fees and expenses of various advisors, transfer taxes, employee transaction bonuses, and filing and listing fees (the “Closing Cash Consideration”);

 

  (b)

A number of shares of Class A common stock and New Fathom Units (together with one share of Class B common stock to be issued at par value for cash in respect of each New Fathom Units), to be allocated as set forth on the Allocation Schedule (as defined in the Business Combination Agreement), in an aggregate number (rounded up to the nearest whole share) equal to the quotient of (i) the result of (A) $1,200,000,000 minus (B) the Closing Cash Consideration divided by (ii) $10.00 (the “Closing Seller Equity Consideration”); and

 

  (c)

An aggregate of 9,000,000 shares of Class A common stock and New Fathom Units (the “Earnout Shares”). These earnout shares will be issued in three equal tranches of 3,000,000 shares, with each tranche vesting at each of the following share price thresholds: $12.50, $15.00 and $20.00, in each case subject to the vesting and forfeiture provisions set forth in the Investor Rights Agreement (as defined herein) and Fathom OpCo’s Amended and Restated Limited Liability Company Agreement (the “Fathom Operating Agreement”). The earnout period will be five years from the date of the closing of the Business Combination. The achievement of the price threshold will be determined based on a VWAP for 20 trading days within any 30-trading day period or a change of control transaction of Fathom that implies the same per share valuation as the applicable price threshold.

 

14


Table of Contents
Q:

WHEN WILL THE BUSINESS COMBINATION BE COMPLETED?

 

A:

The parties currently expect that the Business Combination will be completed during the second half of 2021. However, neither Altimar II nor Fathom OpCo can assure you of when or if the Business Combination will be completed, and it is possible that factors outside of the control of Altimar II and Fathom OpCo could result in the Business Combination being completed at a different time or not at all. The outside date for consummation of the Business Combination is December 31, 2021. Altimar II must first obtain the approval of Altimar II shareholders for each of the Condition Precedent Proposals, Fathom OpCo must obtain the approval of its members, and Altimar II and Fathom OpCo must also first obtain certain necessary regulatory approvals and satisfy other closing conditions. See “The Business Combination Agreement — Conditions to Closing of the Business Combination Agreement.”

 

Q:

WHAT HAPPENS IF THE BUSINESS COMBINATION IS NOT COMPLETED?

 

A:

If Altimar II does not complete the Business Combination with Fathom OpCo for any reason, Altimar II would need to search for another target business with which to complete a business combination. If Altimar II does not complete the Business Combination with Fathom OpCo or a business combination with another target business by February 9, 2023, Altimar II must redeem 100% of the outstanding Class A ordinary shares, at a per-share price, payable in cash, equal to the amount then held in the Trust Account (less income taxes paid or payable, if any, and up to $100,000 of interest to pay dissolution expenses) divided by the number of then outstanding Class A ordinary shares. The Sponsor has no redemption rights in the event a business combination is not effected in the required time period and, accordingly, its founder shares will be worthless. Additionally, in the event of such liquidation, there will be no distribution with respect to Altimar II’s outstanding warrants. Accordingly, such warrants will expire worthless.

QUESTIONS AND ANSWERS ABOUT OUR EXTRAORDINARY GENERAL MEETING

 

Q:

WHAT AM I BEING ASKED TO VOTE ON AND WHY IS THIS APPROVAL NECESSARY?

 

A:

Altimar II shareholders are being asked to vote on the following Shareholder Proposals:

 

  1.

the Business Combination Proposal;

  2.

the Domestication Proposal;

  3.

the Organizational Documents Proposal;

  4.

the Advisory Charter Proposals;

  5.

the Stock Issuance Proposal;

  6.

the Business Combination Issuance Proposal;

  7.

the Equity Incentive Plan Proposal;

  8.

the ESPP Proposal; and

  9.

the Adjournment Proposal.

 

    

The Business Combination is conditioned upon the approval of the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal, the Stock Issuance Proposal, the Business Combination Issuance Proposal, the Equity Incentive Plan Proposal and the EPP Proposal, subject to the terms of the Business Combination Agreement. The Business Combination is not conditioned on the approval of the Advisory Charter Proposals or the Adjournment Proposal. If the Business Combination Proposal is not approved, the other proposals (except the Adjournment Proposal) will not be presented to the shareholders for a vote.

 

Q:

WHY IS ALTIMAR II PROPOSING THE BUSINESS COMBINATION?

 

A:

Altimar II was incorporated to effect a merger, share exchange, asset acquisition, share purchase, reorganization or other similar business combination with one or more businesses or entities (each, a “business combination”).

 

15


Table of Contents
    

On February 9, 2021, Altimar II completed its IPO, generating gross proceeds of $345,000,000 (including the full exercise of the underwriters’ over-allotment option). Since Altimar II’s initial public offering, Altimar II’s activity has been limited to the evaluation of business combination candidates.

 

    

Fathom OpCo, doing business as Fathom Digital Manufacturing, is a leading on-demand digital manufacturing platform in North America, providing comprehensive product development and manufacturing services to many of the largest and most innovative companies in the world.

 

    

The board of directors of Altimar II and the board of managers of Fathom OpCo have unanimously approved the proposed transaction. The proposed Business Combination will create a publicly traded leader in the $25 billion low-to-mid volume on-demand manufacturing industry.

 

    

Based on its due diligence investigation of Fathom OpCo and the industry in which it operates, including the financial and other information provided by Fathom OpCo in the course of its negotiations in connection with the Business Combination Agreement, Altimar II believes that Fathom will have a uniquely attractive financial profile due to its compelling growth trajectory, robust margins, strong software platform and the highly fragmented, opportunity rich $25 billion low-to-mid volume market in which it operates. Specifically, Fathom’s unique “one-stop-shop” solution and scale will be difficult to replicate. As a result, Altimar II believes that Fathom will be well positioned to be a long-term leader in the $25 billion low-to-mid volume on-demand manufacturing industry, and that the Business Combination with Fathom OpCo will provide Altimar II shareholders with an opportunity to participate in the ownership of a company with significant growth potential.

 

Q:

DID THE ALTIMAR II BOARD OBTAIN A THIRD-PARTY VALUATION OR FAIRNESS OPINION IN DETERMINING WHETHER OR NOT TO PROCEED WITH THE BUSINESS COMBINATION?

 

A:

Altimar II’s board of directors did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the Business Combination.

 

    

Altimar II’s officers, directors and advisors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and concluded that their experience and backgrounds, together with the experience and sector expertise of Altimar II’s financial advisors, enabled them to make the necessary analyses and determinations regarding the Business Combination. In addition, Altimar II’s officers, directors and advisors have substantial experience with mergers and acquisitions. Accordingly, investors will be relying solely on the judgment of Altimar II’s officers, board of directors and advisors in valuing Fathom OpCo’s business.

 

Q:

DO I HAVE REDEMPTION RIGHTS?

 

A:

If you are a holder of Class A ordinary shares, you have the right to demand that Altimar II redeem such shares for a pro rata portion of the cash held in the Trust Account, which holds the proceeds of Altimar II’s IPO, as of two business days prior to the consummation of the transactions contemplated by the Business Combination Proposal (including interest earned on the funds held in the Trust Account and not previously released to Altimar II to pay its taxes) upon the closing of the transactions contemplated by the Business Combination Agreement (such rights, “Redemption Rights”).

 

    

Notwithstanding the foregoing, a holder of Class A ordinary shares, together with any affiliate of such holder or any other person with whom such holder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act), will be restricted from seeking redemption with respect to more than 15% of the Class A ordinary shares. Accordingly, all Class A ordinary shares in excess of 15% held by a Public Shareholder, together with any affiliate of such holder or any other person with whom such holder is acting in concert or as a “group”, will not be redeemed.

 

    

If passed, the Organizational Documents Proposal would remove the requirement that Altimar II have at least $5,000,001 of net tangible assets after giving effect to the redemption of all such shares.

 

16


Table of Contents
Q:

WILL HOW I VOTE AFFECT MY ABILITY TO EXERCISE REDEMPTION RIGHTS?

 

A:

No. You may exercise your redemption rights whether you vote your Class A ordinary shares for or against, or whether you abstain from voting on, the Business Combination Proposal or any other Shareholder Proposal. As a result, the Business Combination Proposal can be approved by shareholders who will redeem their Class A ordinary shares and no longer remain shareholders and subject to the terms and conditions of the BCA, the Business Combination may be consummated even though the funds available from the Trust Account and the number of Public Shareholders are substantially reduced as a result of redemptions by Public Shareholders. Also, with fewer Class A ordinary shares and Public Shareholders, the trading market for Altimar II Class A ordinary shares may be less liquid than the market for Altimar II Class A ordinary shares prior to the Business Combination and Altimar II may not be able to meet the listing standards of a national securities exchange. In addition, with fewer funds available from the Trust Account, the capital infusion from the Trust Account into Fathom OpCo’s business will be reduced.

 

Q:

HOW DO I EXERCISE MY REDEMPTION RIGHTS?

 

A:

If you are a holder of Class A ordinary shares and wish to exercise your redemption rights, you must demand that Altimar II redeem your shares for cash no later than the second business day preceding the vote on the Business Combination Proposal by delivering your share certificates (if any) and other redemption forms to Altimar II’s transfer agent physically or electronically using Depository Trust Company’s DWAC (Deposit and Withdrawal at Custodian) system prior to the vote at the Special Meeting. Holders of units must elect to separate the underlying Class A ordinary shares and public warrants prior to exercising redemption rights with respect to the Class A ordinary shares. If holders hold their units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the units into underlying Class A ordinary shares and public warrants, or if a holder holds units registered in its own name, the holder must contact Continental Stock Transfer & Trust Company, Altimar II’s transfer agent, directly and instruct them to do so. Any holder of Class A ordinary shares will be entitled to demand that such holder’s shares be redeemed for a full pro rata portion of the amount then in the Trust Account (which, for illustrative purposes, was approximately $                million, or $                per share, as of                 , 2021, the record date). Such amount, including interest earned on the funds held in the Trust Account and not previously released to Altimar II to pay its taxes, if any (less up to $100,000 of interest to pay dissolution expenses), will be paid promptly upon consummation of the Business Combination. However, the proceeds deposited in the Trust Account could become subject to the claims of Altimar II’s creditors, if any, which could have priority over the claims of Altimar II’s Public Shareholders, regardless of whether such Public Shareholders vote for or against the Business Combination Proposal. Therefore, the per-share distribution from the Trust Account in such a situation may be less than originally anticipated due to such claims. Your vote on any Shareholder Proposal will have no impact on the amount you will receive upon exercise of your redemption rights.

 

    

Any request for redemption made by a holder of Class A ordinary shares may not be withdrawn once submitted to Altimar II unless the board of directors of Altimar II determines (in its sole discretion) to permit the withdrawal of such redemption request (which it may do in whole or in part).

 

    

Any written demand of redemption rights must be received by Altimar II’s transfer agent prior to the vote taken on the Business Combination Proposal at the Special Meeting. No demand for redemption will be honored unless the holder’s share certificates (if any) and other redemption forms have been delivered (either physically or electronically) to the transfer agent prior to the vote at the Special Meeting.

 

    

If a holder of Class A ordinary shares properly makes a request for redemption and the certificates for the Class A ordinary shares (if any) along with the redemption forms are delivered as described to Altimar II’s transfer agent as described herein, then, if the Business Combination is consummated, Altimar II will redeem these shares for a pro rata portion of funds deposited in the Trust Account. If you exercise your redemption rights, then you will be exchanging your Class A ordinary shares for cash.

 

17


Table of Contents
Q:

WHAT ARE THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF EXERCISING MY REDEMPTION RIGHTS?

 

A:

We expect that a U.S. holder (as defined in “Material U.S. Federal Income Tax Considerations — U.S. Holders” below) that exercises its redemption rights to receive cash from the Trust Account in exchange for its public shares will generally be treated as selling such public shares resulting in the recognition of capital gain or capital loss. There may be certain circumstances in which the redemption may be treated as a distribution for U.S. federal income tax purposes depending on the amount of Fathom common stock that a U.S. holder owns or is deemed to own (including through the ownership of Fathom warrants). For a more complete discussion of the U.S. federal income tax considerations of an exercise of redemption rights, see “Material U.S. Federal Income Tax Considerations”. Additionally, because the Domestication will occur immediately prior to the redemption of U.S. holders that exercise redemption rights, U.S. holders exercising redemption rights will be subject to the potential tax consequences of Section 367 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) and the potential tax consequences of the rules applicable to a company treated as a “passive foreign investment company” (“PFIC”), as a result of the Domestication. The tax consequences of exercising redemption rights are discussed more fully below under “Material U.S. Federal Income Tax Considerations — U.S. Holders — Effect to U.S. Holders of Altimar II Ordinary Shares Exercising Redemption Rights.”

 

Q:

DO I HAVE APPRAISAL RIGHTS IN CONNECTION WITH THE PROPOSED BUSINESS COMBINATION AND THE PROPOSED DOMESTICATION?

 

A:

No. Neither Altimar II shareholders nor Altimar II warrantholders have appraisal rights in connection with the Business Combination or the Domestication under Cayman Islands law or under the DGCL.

 

Q:

WHY IS ALTIMAR II PROPOSING THE DOMESTICATION?

 

A:

Altimar II’s board of directors believes that there are significant advantages to Fathom that will arise as a result of a change of domicile to Delaware, including, (i) the prominence, predictability and flexibility of Delaware law, (ii) Delaware’s well-established principles of corporate governance and (iii) the increased ability for Delaware corporations to attract and retain qualified directors, each of the foregoing as discussed in greater detail in the section entitled “Proposal No. 2 — The Domestication Proposal — Reasons for the Domestication.” Altimar II’s board of directors believes that any direct benefit that Delaware law provides to a corporation also indirectly benefits shareholders, who are the owners of the corporation. Additionally, Fathom OpCo has required the Domestication as a condition to consummating the Business Combination.

 

    

To effect the Domestication, Altimar II will file a notice of deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and file a certificate of incorporation and a certificate of corporate domestication with the Secretary of State of the State of Delaware, under which Altimar II will be domesticated and continue as a Delaware corporation, at which time Altimar II will change its name to “Fathom Digital Manufacturing Corporation.”

 

    

The approval of the Domestication Proposal is a condition to the closing of the transactions contemplated by the Business Combination Agreement. The approval of the Domestication Proposal requires a special resolution under Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. Abstentions and broker non-votes, while considered present for the purposes of establishing a quorum, will not count as a vote cast at the Special Meeting. Under the Amended and Restated Memorandum and Articles of Association, prior to the closing of a business combination (as defined therein) only the holders of Altimar II Class B ordinary shares will be entitled to vote on the Domestication Proposal.

 

Q:

HOW WILL THE DOMESTICATION AFFECT MY PUBLIC SHARES, PUBLIC WARRANTS AND UNITS?

 

A:

On the effective date of the Domestication, (a) each outstanding Class A ordinary share will automatically convert into one share of Fathom Class A common stock, (b) each outstanding Class B ordinary share will

 

18


Table of Contents
  automatically convert into one share of Fathom Class C common stock (and subsequently at the closing of the Business Combination, each outstanding share of Fathom Class C common stock will automatically convert into Fathom Class A common stock, subject to the forfeiture by the Altimar II Founders of a portion of their Class A common stock pursuant to the Forfeiture and Support Agreement and Business Combination Agreement as described herein) and (c) the outstanding warrants to purchase Class A ordinary shares will automatically become exercisable for shares of Fathom Class A common stock. At a moment in time after the effectiveness of the Domestication and before the closing of the Business Combination, each outstanding unit of Altimar II (each of which consists of one share of Altimar II Class A ordinary shares and one-fourth of one warrant to purchase one share of Altimar II Class A ordinary shares) will be separated into its component common stock and warrant. Such warrants will become exercisable into shares of Class A common stock any time after the later of the one year following the completion of Altimar II’s IPO and 30 days following the completion of the Business Combination.

 

Q:

WHAT HAPPENS TO THE FUNDS DEPOSITED IN THE TRUST ACCOUNT AFTER CONSUMMATION OF THE BUSINESS COMBINATION?

 

A:

The net proceeds of Altimar II’s initial public offering, together with funds raised from the sale of Private Placement Warrants simultaneously with the consummation of Altimar II’s initial public offering, was placed in the Trust Account immediately following Altimar II’s initial public offering. After consummation of the Business Combination, the funds in the Trust Account will be used to pay holders of the Class A ordinary shares who exercise redemption rights, to pay fees and expenses incurred in connection with the Business Combination (including aggregate fees of approximately $12,075,000 as deferred underwriting commissions related to Altimar II’s initial public offering) and, together with the proceeds of the PIPE Investment, to pay the Closing Cash Consideration.

 

Q:

WHAT ARE THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE DOMESTICATION?

 

A:

As discussed more fully under “Material U.S. Federal Income Tax Considerations” below, it is intended that the Domestication qualify as a tax-free reorganization within the meaning of Section 368(a)(l)(F) of the Code. However, due to the absence of direct guidance on the application of Section 368(a)(1)(F) to a statutory conversion of a corporation holding only investment-type assets such as Altimar II, this result is not entirely clear. Assuming that the Domestication so qualifies, U.S. holders (as defined in “Material U.S. Federal Income Tax Considerations — U.S. Holders” below) of Altimar II ordinary shares will be subject to Section 367(b) of the Code and, as a result:

 

   

A U.S. holder of Altimar II ordinary shares whose Altimar II ordinary shares have a fair market value of less than $50,000 at the time of the Domestication should not recognize any gain or loss and generally should not be required to include any part of Altimar II’s earnings in income;

 

   

A U.S. holder of Altimar II ordinary shares whose Altimar II ordinary shares have a fair market value of $50,000 or more on the date of the Domestication, but who at the time of the Domestication owns (actually and constructively) less than 10% of the total combined voting power of all classes of Altimar II ordinary shares entitled to vote and less than 10% of the total value of all classes of Altimar II ordinary shares will generally recognize gain (but not loss) as a result of the Domestication. As an alternative to recognizing gain, such U.S. holders may file an election to include in income as a dividend earnings and profits (as defined in the U.S. Treasury regulations (“Treasury Regulations”) under Section 367 of the Code) attributable to its Altimar II ordinary shares provided certain other requirements are satisfied. Altimar II does not expect that Altimar II’s cumulative earnings and profits will be material at the time of the Domestication.

 

   

A U.S. holder of Altimar II ordinary shares who at the time of the Domestication owns (actually and constructively) 10% or more of the total combined voting power of all classes of Altimar II ordinary shares or 10% of the total value of all classes of Altimar II shares entitled to vote will

 

19


Table of Contents
 

generally be required to include in income as a dividend earnings and profits (as defined in the Treasury Regulations under Section 367 of the Code) attributable to its Altimar II ordinary shares. Altimar II does not expect that Altimar II’s cumulative earnings and profits will be material at the time of domestication. If Altimar II were to be treated as a PFIC for U.S. federal income tax purposes, certain U.S. holders may be subject to adverse tax consequences as a result of the Domestication. Pursuant to a start-up exception, a corporation will not be a PFIC for the first taxable year the corporation has gross income (the “start-up year”), if (i) no predecessor of the corporation was a PFIC; (ii) the corporation satisfies the IRS that it will not be a PFIC for either of the first two taxable years following the start-up year; and (iii) the corporation is not in fact a PFIC for either of those two years. Altimar II believes, although subject to uncertainty, that Altimar II’s 2021 taxable year may be the start-up year and that Altimar II may not be treated as a PFIC for 2021. The application of the start-up exception will depend, in part, on whether the Domestication is consummated in 2021. In addition, the application of the start-up exception to the present transaction involves the application of complicated rules with respect to which there is no clear authority. Accordingly, there can be no assurance with respect to Altimar II’s status as a PFIC for 2021. All holders are urged to consult their tax advisors concerning the application of the PFIC rules to Altimar II under such holder’s particular circumstances, including the potential to make a “qualified electing fund” election or a protective “qualified electing fund” election. The requirement to qualify for the start-up exception and the potential application of the PFIC rules to the Domestication are discussed more fully under “Material U.S. Federal Income Tax Considerations — U.S. Holders — PFIC Considerations”.

 

    

Additionally, the Domestication may cause non-U.S. holders (as defined in “Material U.S. Federal Income Tax Considerations — Non-U.S. Holders” below) to become subject to U.S. federal income withholding taxes on any dividends in respect of such non-U.S. holder’s Fathom common stock (or warrants) subsequent to the Domestication.

 

    

The tax consequences of the Domestication are complex and will depend on a holder’s particular circumstances. All holders are strongly urged to consult their tax advisor for a full description and understanding of the tax consequences of the Domestication, including the applicability and effect of U.S. federal, state, local and foreign income and other tax laws. For a more complete discussion of the U.S. federal income tax considerations of the Domestication, see “Material U.S. Federal Income Tax Considerations”.

 

Q:

HOW DOES THE SPONSOR INTEND TO VOTE ON THE SHAREHOLDER PROPOSALS?

 

A:

The Sponsor owns of record and is entitled to vote an aggregate of approximately 20% of the outstanding shares of Altimar ordinary shares. The Sponsor has agreed to vote any founder shares and any Class A ordinary shares held by it as of the record date in favor of the Shareholder Proposals. See “The Business Combination Agreement — Related Agreements — Forfeiture and Support Agreement”. In addition, each of Sponsor and the other Altimar II Founders agreed, among other things, (i) from the date of the Business Combination Agreement until the earlier of the Closing or the termination of the Business Combination Agreement in accordance with its terms, to not redeem any Class A ordinary shares (or, if applicable, shares of Class A common stock) held by it and (ii) prior to the consummation of Business Combination or the termination of the Business Combination Agreement, to vote or cause to be voted, all of the Altimar II shares beneficially owned by Sponsor or such other Founder Holder, at every meeting of the shareholders of Altimar II at which such matters are considered and at every adjournment or postponement thereof: (1) in favor of (A) the Business Combination and the Business Combination Agreement and the other transactions contemplated thereby (including any proposals recommended by Altimar II’s Board of Directors in connection with the Business Combination) and (B) any proposal to adjourn or postpone such meeting of shareholders to a later date if there are not sufficient votes to approve the Business Combination; (2) against any action, proposal, transaction or agreement that could reasonably be expected to result in a breach of any covenant, representation or warranty or any other obligation or agreement of Altimar II under the Business

 

20


Table of Contents
  Combination Agreement; and (3) against (A) any proposal or offer from any person concerning (I) a merger, consolidation, liquidation, recapitalization, share exchange or other business combination transaction involving Altimar II, or (II) the issuance or acquisition of shares of capital stock or other Altimar II equity securities (other than as contemplated or permitted by the Business Combination Agreement); and (B) any action, proposal, transaction or agreement that would reasonably be expected to (x) impede the fulfillment of Altimar II’s conditions under the Business Combination Agreement or change in any manner the voting rights of any class of Altimar II’s shares or (y) result in a breach of any covenant, representation or warranty or other obligation or agreement of Sponsor or any of the other Altimar II Founders contained in the Forfeiture and Support Agreement. See also “Certain Relationships and Related Party Transactions — Forfeiture and Support Agreement.”

 

Q:

WHAT CONSTITUTES A QUORUM AT THE SPECIAL MEETING?

 

A:

The holders of a majority of the voting power of the issued and outstanding Altimar II ordinary shares entitled to vote at the Special Meeting must be present, in person or virtually or represented by proxy, at the Special Meeting to constitute a quorum and in order to conduct business at the Special Meeting. Abstentions and broker non-votes will be counted as present for the purpose of determining a quorum. The holders of the founder shares, who currently own approximately 20% of the issued and outstanding shares of Altimar II ordinary shares, 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, holders of                Altimar II ordinary shares would be required to be present to achieve a quorum.

 

Q:

WHAT VOTE IS REQUIRED TO APPROVE EACH PROPOSAL AT THE SPECIAL MEETING?

 

A:

The Business Combination Proposal: The approval of the Business Combination Proposal requires an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. Altimar II shareholders must approve the Business Combination Proposal in order for the Business Combination to occur. If Altimar II shareholders fail to approve the Business Combination Proposal, the Business Combination will not occur. Pursuant to the IPO Letter Agreement and as further discussed in the section entitled “The Business Combination Agreement — Related Agreements — Forfeiture and Support Agreement,” the Sponsor and the other Altimar II Founders have agreed to vote shares representing approximately 20% of the aggregate voting power of the Altimar II ordinary shares in favor of the Business Combination Proposal.

The Domestication Proposal: The approval of the Domestication Proposal requires a special resolution under Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. The Domestication Proposal is conditioned on the approval of the Business Combination Proposal. Therefore, if the Business Combination Proposal is not approved, the Domestication Proposal will have no effect, even if approved by Altimar II’s Public Shareholders. Pursuant to the IPO Letter Agreement and the Forfeiture and Support Agreement, the Sponsor and the other Altimar II Founders have agreed to vote shares representing approximately 20% of the aggregate voting power of the Altimar II ordinary shares in favor of the Domestication Proposal. Under the Amended and Restated Memorandum and Articles of Association, prior to the closing of a business combination (as defined therein) only the holders of Altimar II Class B ordinary shares will be entitled to vote on the Domestication Proposal.

The Organizational Documents Proposal: The approval of the Organizational Documents Proposal requires a special resolution under Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. The Organizational Documents Proposal is conditioned on the approval of the Domestication Proposal, and, therefore, also conditioned on approval of the Business Combination Proposal. Therefore, if the Business Combination Proposal or the Domestication Proposal is not approved,

 

21


Table of Contents

the Organizational Documents Proposal will have no effect, even if approved by Altimar II’s Public Shareholders. Pursuant to the Forfeiture and Support Agreement, the Sponsor and the other Altimar II Founders have agreed to vote shares representing approximately 20% of the aggregate voting power of the Altimar II ordinary shares in favor of the Organizational Documents Proposal. Under the Amended and Restated Memorandum and Articles of Association, prior to the closing of a business combination (as defined therein) only the holders of Altimar II Class B ordinary shares will be entitled to vote on the Organizational Documents Proposal.

The Advisory Charter Proposals: The approval of any of the Advisory Charter Proposals is not otherwise required by Cayman Islands law or Delaware law separate and apart from the Organizational Documents Proposal, but pursuant to SEC guidance, Altimar II is required to submit these provisions to its stockholders separately for approval. However, the stockholder votes regarding these proposals are advisory votes, and are not binding on Altimar II or the Altimar II Board (separate and apart from the approval of the Organizational Documents Proposal). Furthermore, the Business Combination is not conditioned on the separate approval of the Advisory Charter Proposals (separate and apart from approval of the Organizational Documents Proposal).

The Stock Issuance Proposal: The approval of the Stock Issuance Proposal requires an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. The Stock Issuance Proposal is conditioned on the approval of the Organizational Documents Proposal, and, therefore, also conditioned on approval of the Domestication Proposal and the Business Combination Proposal. Therefore, if any of the Business Combination Proposal, the Domestication Proposal or the Organizational Documents Proposal is not approved, the Stock Issuance Proposal will have no effect, even if approved by Altimar II’s Public Shareholders. Pursuant to the IPO Letter Agreement and the Forfeiture and Support Agreement, the Sponsor and the other Altimar II Founders have agreed to vote shares representing approximately 20% of the aggregate voting power of the Altimar II ordinary shares in favor of the Stock Issuance Proposal.

The Business Combination Issuance Proposal: The approval of the Business Combination Issuance Proposal requires an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. The Business Combination Issuance Proposal is conditioned on the approval of the Stock Issuance Proposal and, therefore, also conditioned on the approval of the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal and the Equity Incentive Plan Proposal. Therefore, if any of those Shareholder Proposals is not approved, the Business Combination Issuance Proposal will have no effect, even if approved by Altimar II’s Public Shareholders. Pursuant to the IPO Letter Agreement and the Forfeiture and Support Agreement, the Sponsor and the other Altimar II Founders have agreed to vote shares representing approximately 20% of the aggregate voting power of the Altimar II ordinary shares in favor of the Business Combination Issuance Proposal.

The Equity Incentive Plan Proposal: The approval of the Equity Incentive Plan Proposal requires an ordinary resolution, being the affirmative vote of the holders of a majority of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. The Equity Incentive Plan Proposal is conditioned on the approval of the Business Combination Issuance Proposal and, therefore, also conditioned on the approval of the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposals and Stock Issuance Proposal. Therefore, if any of those proposals is not approved, the Equity Incentive Plan Proposal will have no effect, even if approved by Altimar II’s Public Shareholders.

The ESPP Proposal: The approval of the ESPP Proposal requires an ordinary resolution, being the affirmative vote of the holders of a majority of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. The ESPP Proposal is conditioned on the approval of the Business Combination Issuance Proposal and, therefore, also conditioned on the approval of the Business

 

22


Table of Contents

Combination Proposal, the Domestication Proposal, the Organizational Documents Proposals and Stock Issuance Proposal. Therefore, if any of those proposals is not approved, the ESPP Proposal will have no effect, even if approved by Altimar II’s Public Shareholders.

 

    

The Adjournment Proposal: The approval of the Adjournment Proposal requires an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. The Adjournment Proposal is not conditioned upon any other Shareholder Proposal.

 

Q:

DO ANY OF ALTIMAR II’S DIRECTORS OR OFFICERS HAVE INTERESTS IN THE BUSINESS COMBINATION THAT MAY DIFFER FROM OR BE IN ADDITION TO THE INTERESTS OF ALTIMAR II SHAREHOLDERS?

 

A:

Altimar II’s executive officers and certain non-employee directors may have interests in the Business Combination that may be different from, or in addition to, the interests of Altimar II’s shareholders generally. The Altimar II board of directors was aware of and considered these interests to the extent such interests existed at the time, among other matters, in approving the Business Combination Agreement and in recommending that the Business Combination Agreement and the transactions contemplated thereby be approved by the shareholders of Altimar II . See “The Business Combination Proposal — Interests of Altimar II Directors and Officers in the Business Combination.”

 

    

For additional information regarding pre-existing relationships between certain of the parties to the Business Combination Agreement and certain of their affiliates, see “Risk Factors — Risks Related to the Business Combination and Altimar II — Pre-existing relationships between participants in the Business Combination and the related transactions or their affiliates could give rise to actual or perceived conflicts of interest in connection with the Business Combination.

 

Q:

WHAT DO I NEED TO DO NOW?

 

A:

After carefully reading and considering the information contained in this proxy statement/prospectus, please submit your proxies as soon as possible so that your shares will be represented at the Special Meeting. Please follow the instructions set forth on the proxy card or on the voting instruction form provided by your broker, bank or other nominee if your shares are held in the name of your broker, bank or other nominee.

 

Q:

HOW DO I VOTE?

 

A:

If you are a shareholder of record of Altimar II as of                , 2021 (the “record date”) you may submit your proxy before the Special Meeting in any of the following ways, if available:

 

   

use the toll-free number shown on your proxy card;

 

   

visit the website shown on your proxy card to vote via the Internet; or

 

   

complete, sign, date and return the enclosed proxy card in the enclosed postage-paid envelope.

 

    

If you are a shareholder of record of Altimar II as of the record date, you may also cast your vote at the Special Meeting.

 

    

If your shares are held in “street name” through a broker, bank or other nominee, your broker, bank or other nominee will send you separate instructions describing the procedure for voting your shares. “Street name” shareholders who wish to vote at the Special Meeting will need to obtain a proxy form from their broker, bank or other nominee.

 

Q:

WHEN AND WHERE IS THE SPECIAL MEETING?

 

A:

The Special Meeting will be held on                , 2021, at                 local time. For the purposes of Altimar II ’s Amended and Restated Memorandum and Articles of Association, the physical place of the meeting will

 

23


Table of Contents
  be                 . In light of the novel coronavirus pandemic and to support the well-being of Altimar II’s shareholders, directors and officers, Altimar II encourages you to use remote methods of attending the Special Meeting or to attend via proxy. You may attend the Special Meeting and vote your shares electronically during the Special Meeting via live webcast by visiting                  . You will need the meeting control number that is printed on your proxy card to enter the Special Meeting. You may also attend the meeting telephonically by dialing                  . All Altimar II shareholders as of the record date, or their duly appointed proxies, may attend the Special Meeting.

 

Q:

IF MY SHARES ARE HELD IN “STREET NAME” BY A BROKER, BANK OR OTHER NOMINEE, WILL MY BROKER, BANK OR OTHER NOMINEE VOTE MY SHARES FOR ME?

 

A:

If your shares are held in “street name” in a stock brokerage account or by a broker, bank or other nominee, you must provide the record holder of your shares with instructions on how to vote your shares. Please follow the voting instructions provided by your broker, bank or other nominee. Please note that you may not vote shares held in “street name” by returning a proxy card directly to Altimar II or by voting at the Special Meeting unless you provide a “legal proxy”, which you must obtain from your broker, bank or other nominee. In addition to such legal proxy, if you plan to attend the Special Meeting, but are not a shareholder of record because you hold your shares in “street name”, please have evidence of your beneficial ownership of your shares (e.g., a copy of a recent brokerage statement showing the shares) and valid photo identification with you at the Special Meeting.

 

    

Under the rules of the NYSE, brokers who hold shares in “street name” for a beneficial owner of those shares typically have the authority to vote in their discretion on “routine” proposals when they have not received instructions from beneficial owners. However, brokers are not permitted to exercise their voting discretion with respect to the approval of matters that the NYSE determines to be “non-routine” without specific instructions from the beneficial owner. It is expected that all of the Shareholder Proposals are “non-routine” matters. Broker non-votes occur when a broker or nominee is not instructed by the beneficial owner of shares to vote on a particular Shareholder Proposal for which the broker does not have discretionary voting power.

 

    

If you are an Altimar II shareholder holding your shares in “street name” and you do not instruct your broker, bank or other nominee on how to vote your shares, your broker, bank or other nominee will not vote your shares on the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal, the Advisory Charter Proposals, the Stock Issuance Proposal, the Business Combination Issuance Proposal, the Equity Incentive Plan Proposal or the Adjournment Proposal. Such abstentions and broker non-votes will have no effect on the vote count for any of the proposals.

 

Q:

WHAT IF I ATTEND THE SPECIAL MEETING AND ABSTAIN OR DO NOT VOTE?

 

A:

For purposes of the Special Meeting, an abstention occurs when a shareholder attends the meeting and does not vote or returns a proxy with an “abstain” vote.

 

    

If you are an Altimar II shareholder that attends the Special Meeting and fails to vote on the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal, the Advisory Charter Proposals, the Stock Issuance Proposal, the Business Combination Issuance Proposal, the Equity Incentive Plan Proposal, the ESPP Proposal or the Adjournment Proposal, or if you respond to such proposals with an “abstain” vote, your failure to vote or “abstain” vote in each case will have no effect on the vote count for such proposals.

 

Q:

WHAT WILL HAPPEN IF I RETURN MY PROXY CARD WITHOUT INDICATING HOW TO VOTE?

 

A:

If you sign and return your proxy card without indicating how to vote on any particular Shareholder Proposal, the Altimar II shares represented by your proxy will be voted as recommended by the Altimar II board of directors with respect to that Shareholder Proposal.

 

24


Table of Contents
Q:

MAY I CHANGE MY VOTE AFTER I HAVE DELIVERED MY PROXY OR VOTING INSTRUCTION CARD?

 

A:

Yes. You may change your vote at any time before your proxy is voted at the Special Meeting. You may do this in one of three ways:

 

   

filing a notice with Altimar II or its proxy solicitor;

 

   

mailing a new, subsequently dated proxy card; or

 

   

by attending the Special Meeting and electing to vote your shares.

 

    

If you are a shareholder of record of Altimar II and you choose to send a written notice or to mail a new proxy, you must submit your notice of revocation or your new proxy to Altimar II, 40 West 57th Street, 33rd Floor, New York, NY, 10019 and it must be received at any time before the vote is taken at the Special Meeting. Any proxy that you submitted may also be revoked by submitting a new proxy by mail, or online or by telephone, not later than 5:00 p.m. New York City time on                  , 2021, or by voting at the Special Meeting. Simply attending the Special Meeting will not revoke your proxy. If you have instructed a broker, bank or other nominee to vote your shares of Altimar II ordinary shares, you must follow the directions you receive from your broker, bank or other nominee in order to change or revoke your vote.

 

Q:

WHAT HAPPENS IF I FAIL TO TAKE ANY ACTION WITH RESPECT TO THE SPECIAL MEETING?

 

A:

If you fail to take any action with respect to the Special Meeting and the Business Combination is approved by shareholders and consummated, you will continue to be a shareholder of Altimar II. Failure to take any action with respect to the Special Meeting will not affect your ability to exercise your redemption rights. If you fail to take any action with respect to the Special Meeting and the Business Combination is not approved, you will continue to be a shareholder of Altimar II while Altimar II searches for another target business with which to complete a business combination.

 

Q:

WHAT SHOULD I DO IF I RECEIVE MORE THAN ONE SET OF VOTING MATERIALS?

 

A:

Shareholders may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus 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 under 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 a vote with respect to all of your shares.

 

Q:

WHOM SHOULD I CONTACT IF I HAVE ANY QUESTIONS ABOUT THE PROXY MATERIALS OR VOTING?

 

A:

If you have any questions about the proxy materials, need assistance submitting your proxy or voting your shares or need additional copies of this proxy statement/prospectus or the enclosed proxy card, you should contact Innisfree M&A Incorporated, the proxy solicitor for Altimar II, toll-free at (817) 750-8129 (banks and brokers call (212) 750-5833).

 

25


Table of Contents

SUMMARY

This summary highlights selected information included in this document and does not contain all of the information that may be important to you. You should read this entire document and its annexes and the other documents to which Altimar II, Fathom and Fathom OpCo refer to before you decide how to vote with respect to the Shareholder Proposals. Each item in this summary includes a page reference directing you to a more complete description of that item.

Information About the Parties to the Business Combination

Altimar Acquisition Corp. II

40 West 57th Street

33rd Floor

New York, NY 10019

(212) 287-6767

Altimar Acquisition Corp. II is a blank check company incorporated on December 7, 2020 as a Cayman Islands exempted company organized for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses.

Fathom Holdco, LLC

1050 Walnut Ridge Drive

Hartland, WI 53209

(262) 367-8254

Fathom Holdco, LLC, doing business as “Fathom Digital Manufacturing,” is a leading on-demand digital manufacturing platform in North America, providing comprehensive product development and manufacturing services to many of the largest and most innovative companies in the world.

The Business Combination Agreement

The terms and conditions of the Business Combination are contained in the BCA, substantially in the form attached to this proxy statement/prospectus as Annex C, which is incorporated by reference herein in its entirety. Altimar II encourages you to read the BCA carefully, as it is the legal document that governs the Business Combination. For more information on the BCA, see the section entitled “The Business Combination Agreement.”

Structure of the Business Combination

In connection with the Closing:

 

  (a)

Altimar II will change its jurisdiction of incorporation by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation under the laws of the State of Delaware (the “Domestication”), upon which Altimar II will change its name to “Fathom Digital Manufacturing Corporation.”

 

  (b)

Fathom OpCo will issue managing member interests in Fathom OpCo to Altimar II in exchange for a nominal cash payment; and

 

  (c)

Following a series of reorganization transactions among certain equity holders of Fathom OpCo’s businesses (the “Fathom Blockers”) and Altimar II, as specified in the Business Combination


 

26


Table of Contents
  Agreement, Rapid Merger Sub, LLC, a wholly owned subsidiary of Altimar II, will merge with and into Fathom OpCo (the “Fathom Merger”), with Fathom OpCo as the surviving entity of the Fathom Merger (Fathom OpCo, in its capacity as the surviving entity of the Fathom Merger, is sometimes referred to as the “Fathom Surviving Entity”). Following the Fathom Merger, the Fathom Surviving Entity will be owned by Altimar II and all other holders of Fathom OpCo units outstanding immediately prior to the Merger (such other holders, excluding Altimar II, are referred to as the “Continuing Fathom Unitholders”).

Upon consummation of the transactions contemplated by the Business Combination Agreement, the combined company will be organized in an “Up-C” structure, in which substantially all of the assets and business of the combined company will be held by Fathom OpCo. Altimar II and the Continuing Fathom Unitholders will be issued Class A units of Fathom OpCo (“New Fathom Units”). Altimar II will be the managing member of Fathom OpCo. Altimar II will issue to Continuing Fathom Unitholders for cash at par value a number of shares of Class B common stock equal to the number of New Fathom Units held by the Continuing Fathom Unitholders. Altimar II’s other shareholders will hold Class A common stock of the combined company. Shares of Class A common stock will be entitled to economic rights and one vote per share and shares of Class B common stock will be entitled to one vote per share but no economic rights. The combined company’s business will continue to operate through Fathom OpCo.


 

27


Table of Contents

Simplified Post-Combination Fathom Structure

The following diagram illustrates in simplified terms the expected structure of Fathom and its operating subsidiaries upon the Closing.

 

LOGO

Notes:

 

  1.

Altimar II Founders include Altimar Sponsor II, LLC and the seven current directors of Altimar II.

 

  2.

The warrants held by Public Shareholders are Public Warrants and the warrants held by Altimar Sponsor II, LLC are Private Placement Warrants.

 

  3.

Legacy Fathom Owners include Fathom Blocker Owners and Continuing Fathom Unitholders.

 

  4.

The Class B common stock is non-economic, voting stock of Fathom.

 

  5.

New Fathom Units owned by the Continuing Fathom Unitholders are exchangeable on a one-for-one basis for shares of Class A common stock (with corresponding surrender of an equal number of shares of Class B common stock for cancellation by Fathom), in accordance with the Fathom Operating Agreement.


 

28


Table of Contents

The Private Placement

In connection with entering into the Business Combination Agreement, Altimar II and Fathom OpCo entered into the Subscription Agreements with certain institutional and other accredited investors (the “PIPE Investors”), pursuant to which, among other things, the PIPE Investors party thereto agreed to purchase an aggregate of 8,000,000 shares of Class A common stock following the Domestication and immediately prior to the Closing at a cash purchase price of $10.00 per share, resulting in aggregate proceeds of $80.0 million (the “PIPE Investment”). The Subscription Agreements contain customary representations, warranties, covenants and agreements of Altimar II, Fathom OpCo and the PIPE Investors and are subject to customary closing conditions (including, without limitation, that there is no amendment or modification to the Business Combination Agreement that is material and adverse to the PIPE Investors) and termination rights (including a termination right if the transactions contemplated by the Subscription Agreements have not been consummated by December 31, 2021, other than as a result of breach by the terminating party). The PIPE Investments are expected to close immediately prior to the Closing.

For more information regarding the Private Placement and the Subscription Agreements, see the section entitled “The Business Combination Agreement—Related Agreements—Subscription Agreements.” See also the Subscription Agreements substantially in the form attached to this proxy statement/prospectus as Annex J, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms.

Consideration to be Received in the Business Combination

The total consideration to be paid to the Fathom Blocker Owners and the Continuing Fathom Unitholders (each as defined herein), including CORE Industrial Partners Fund I, LP, at the Closing shall equal the aggregate of:

 

(a)

(i) All the cash proceeds from the Trust Account established for the purpose of holding the net proceeds of Altimar II’s initial public offering, net of any amounts paid to Altimar II’s shareholders that exercise their redemption rights in connection with the Business Combination, together with the proceeds from the PIPE Investment (as defined herein) (the “Available Cash Amount”), (ii) minus up to $25,000,000 to be contributed by Altimar II to the balance sheet of Fathom OpCo, (iii) minus up to $42,000,000 to be used to pay down certain indebtedness of Fathom OpCo, (iv) minus certain transaction expenses of Fathom OpCo and Altimar II, which include fees and expenses of various advisors, transfer taxes, employee transaction bonuses, and filing and listing fees (the “Closing Cash Consideration”); and

 

(b)

A number of shares of Class A common stock and newly issued Class A units of Fathom OpCo (the “New Fathom Units”) (together with one share of Class B common stock to be issued at par value for cash in respect of each New Fathom Units), to be allocated as set forth on the Allocation Schedule (as defined in the Business Combination Agreement), in an aggregate number (rounded up to the nearest whole share) equal to the quotient of (i) the result of (A) $1,200,000,000 minus (B) the Closing Cash Consideration divided by (ii) $10.00 (the “Closing Seller Equity Consideration”).

For more information, see the section entitled “The Business Combination Agreement—Consideration to be Received in the Business Combination.”

Earnout

In addition to the Closing Seller Equity Consideration, an aggregate of 9,000,000 shares of Class A common stock and New Fathom Units (the “Earnout Shares”) will be issued in three equal tranches of 3,000,000 shares, with each tranche vesting at each of the following share price thresholds: $12.50, $15.00 and $20.00, in each case subject to the vesting and forfeiture provisions set forth in the Investor Rights Agreement (as defined herein) and Fathom’s Amended and Restated Limited Liability Company Agreement (the “Fathom Operating Agreement”).


 

29


Table of Contents

The earnout period will be five years from the date of the closing of the Business Combination. The achievement of the price threshold will be determined based on a VWAP for 20 trading days within any 30-trading day period or a change of control transaction of Fathom that implies the same per share valuation as the applicable price threshold.

For more information, see the section entitled “The Business Combination Agreement — Earnout.”

Altimar II Extraordinary Meeting and the Proposals

The Special Meeting will be held at                  a.m., Eastern Time, on,                  2021. For the purposes of Altimar II’s Amended and Restated Memorandum and Articles of Association, the physical place of the meeting will be                 . In light of the novel coronavirus pandemic and to support the well-being of Altimar II’s shareholders, directors and officers, Altimar II encourages you to use remote methods of attending the Special Meeting or to attend via proxy. You may attend the Special Meeting and vote your shares electronically during the Special Meeting via live webcast by visiting                 . You will need the meeting control number that is printed on your proxy card to enter the Special Meeting. You may also attend the meeting telephonically by dialing                 . At the Special Meeting, Altimar II’s shareholders will be asked to approve the Business Combination Proposal, the Domestication Proposal, Organizational Documents Proposal, the Advisory Charter Proposals, the Stock Issuance Proposal, the Business Combination Issuance Proposal, the Equity Incentive Plan Proposal, the ESPP Proposal and the Adjournment Proposal (if necessary).

The Altimar II board of directors has fixed the close of business on                  (the “record date”) as the record date for determining the holders of Altimar II ordinary shares entitled to receive notice of and to vote at the Special Meeting. As of the record date, there were                  shares of Altimar II Class A ordinary shares and                  shares of Altimar II Class B ordinary shares outstanding and entitled to vote at the Special Meeting. Each share of Altimar II ordinary shares entitles the holder to one vote at the Special Meeting on each proposal to be considered at the Special Meeting. As of the record date, the Sponsor and Altimar II’s directors and officers and their affiliates owned and were entitled to vote                  shares of Altimar II ordinary shares, representing approximately 20% of the shares of Altimar II ordinary shares outstanding on that date. Altimar II currently expects that the Sponsor and its directors and officers will vote their shares in favor of the Shareholder Proposals and, pursuant to the IPO Letter Agreement and the Forfeiture and Support Agreement, the Sponsor and directors and officers have agreed to do so. As of the record date, Fathom did not beneficially hold any shares of Altimar II ordinary shares.

A majority of the voting power of the issued and outstanding Altimar II ordinary shares entitled to vote at the Special Meeting must be present, in person or virtually or represented by proxy, at the Special Meeting to constitute a quorum and in order to conduct business at the Special Meeting.

Approval of the Business Combination Proposal requires an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. Approval of the Domestication Proposal, the Organizational Documents Proposal and the Advisory Charter Proposals require a special resolution under Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting. Under the Amended and Restated Memorandum and Articles of Association, prior to the closing of a business combination (as defined therein) only the holders of Altimar II Class B ordinary shares will be entitled to vote on the Domestication Proposal and the Organizational Documents Proposal. Approval of the Advisory Charter Proposals, Stock Issuance Proposal, the Business Combination Issuance Proposal, the Equity Incentive Plan Proposal, the ESPP Proposal and the Adjournment Proposal (if necessary) each requires an ordinary resolution under Cayman Islands law, being the affirmative vote of the holders of a majority of the ordinary shares who, being present and entitled to vote at the Special Meeting, vote at the Special Meeting.


 

30


Table of Contents

The Business Combination is conditioned upon the approval of the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal, the Stock Issuance Proposal, the Business Combination Issuance Proposal, the Equity Incentive Plan Proposal and the ESPP Proposal subject to the terms of the Business Combination Agreement. The Business Combination is not conditioned on the Advisory Charter Proposals or the Adjournment Proposal. If the Business Combination Proposal is not approved, the other Shareholder Proposals (except the Adjournment Proposal) will not be presented to the shareholders for a vote.

Recommendation of Altimar II’s Board of Directors

Altimar II’s board of directors has unanimously determined that the Business Combination Proposal is in the best interests of Altimar II and its shareholders, has unanimously approved the Business Combination Proposal, and unanimously recommends that shareholders vote “FOR” the Business Combination Proposal, “FOR” the Domestication Proposal, “FOR” the Organizational Documents Proposal, “FOR” each of the Advisory Charter Proposals, “FOR” the Stock Issuance Proposal, “FOR” the Business Combination Issuance Proposal, “FOR” for the Equity Incentive Plan Proposal, “FOR” the ESPP Proposal and “FOR” the Adjournment Proposal, in each case, if presented to the Special Meeting.

Altimar II ’s Board of Directors’ Reasons for Approval of the Business Combination

On July 15, 2021, the Board unanimously (i) approved the signing of the Business Combination Agreement and the transactions contemplated thereby and (ii) directed that the Business Combination Agreement, related transaction documentation and other Shareholder Proposals be submitted to Altimar II’s shareholders for approval and adoption, and recommended that Altimar II’s shareholders approve and adopt the Business Combination Agreement, related transaction documentation and such other Shareholder Proposals. In light of the number and wide variety of factors considered in connection with its evaluation of the Business Combination, the Board did not consider it practicable to, and did not attempt to, quantify or otherwise assign relative weights to the specific factors that it considered in reaching its determination and supporting its decision. The Altimar II board of directors did not seek to obtain a third-party valuation or fairness opinion in connection with their determination to approve the Business Combination. The Altimar II board of directors viewed its decision as being based on all of the information available and the factors presented and considered by it. In addition, individual directors may have given different weight to different factors. For more information, see the section entitled “ The Business Combination Agreement—Altimar Board of Directors’ Reasons for the Approval of the Business Combination.” This explanation of Altimar II’s reasons for the Business Combination and all other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors discussed under “Cautionary Statement Regarding Forward-Looking Statements.”

Consistent with its investment philosophy and strategy, Altimar II planned to identify a high-quality business run by exceptional teams pursuing growth and large market opportunities. These criteria were not intended to be exhaustive, and the evaluation relating to the merits of Altimar II’s initial business combination would be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that Altimar II’s management team deemed relevant. In considering the Business Combination with Fathom OpCo, the Board concluded that it met all of the above criteria.

The Board also gave consideration to certain risks related to the Business Combination, which are described in this proxy statement/prospectus under the caption “Risk Factors”.

Certain Regulatory Approvals

The parties will use their respective reasonable best efforts to promptly file all notices, reports and other documents required to be filed by such party with any governmental authority with respect to the Business


 

31


Table of Contents

Combination, and to submit promptly any additional information requested by any such governmental authority. The parties will use their respective reasonable best efforts to promptly obtain all authorizations, approvals, clearances, consents, actions or non-actions of any governmental authority in connection with the applicable filings, applications or notifications. Each party will promptly inform the other parties of any material communication between itself or its representatives and any governmental authority regarding the Business Combination. If a party or any of its affiliates receives any request for supplemental information or documentary material from any governmental authority with respect to the Business Combination, then the party, to the extent necessary and advisable, shall provide a reasonable response to such request as promptly as reasonably practicable.

Additionally, each party’s obligation to complete the Business Combination is subject to the waiting period (and any extension thereof) applicable to the consummation of the Business Combination under the Hart–Scott–Rodino Antitrust Improvements Act of 1976 having expired or been terminated.

Conditions to Closing

The Closing is subject to certain customary conditions, including, among other things: (i) the approval of the Business Combination and other matters by Altimar II’s shareholders; (ii) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and receipt of certain additional regulatory approvals; (iii) the Available Cash Amount (as defined herein) equaling no less than $313,000,000 at the Closing; (iv) (x) fundamental representations and warranties (which includes Organization, Due Authorization, Holding Company; Ownership and Brokers’ Fees) bring down conditions to an “all material respects” standard, (y) general representations and warranties bring down conditions to a “material adverse effect” standard and (z) capitalization representation bring down condition to a “de minimis” standard; (v) covenant bring down conditions to an “all material respects” standard; (vi) the absence of a material adverse effect on the respective parties; and (vii) the effectiveness of this registration statement and the listing of Altimar II Class A common stock to be issued in the Business Combination on the New York Stock Exchange (“NYSE”). To the extent permitted by law, the conditions in the Business Combination Agreement may be waived by the parties thereto.

Termination

The Business Combination Agreement may be terminated by Altimar II or Fathom OpCo under certain circumstances, including, among others, (i) by mutual written consent of Fathom OpCo and Altimar II, (ii) by Fathom OpCo or Altimar II if the Closing has not occurred on or before December 31, 2021 (the “Outside Date”), (iii) by Fathom OpCo or Altimar II in the case of material uncured breach by the other party to the Business Combination Agreement (subject to notice and an opportunity to cure, if curable), (iv) by Fathom OpCo if, prior to obtaining approval of Altimar II’s shareholders, Altimar II’s board of directors made a change in recommendation and (v) by Fathom OpCo or Altimar II if Altimar II has not obtained the required approval of its shareholders.

Redemption Rights

Public Shareholders may seek to redeem the public shares that they hold, regardless of whether they vote for the Business Combination, against the Business Combination or do not vote in relation to the Business Combination. Any Public Shareholder may request redemption of their public shares for a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated as of two business days prior to the consummation of the Business Combination, including interest, less income taxes payable, divided by the number of then issued and outstanding public shares. If a holder properly seeks redemption as described in this section and the Business Combination is consummated, the holder will no longer own these shares following the Business Combination.


 

32


Table of Contents

Notwithstanding the foregoing, a Public Shareholder, together with any affiliate of such holder or any other person with whom such holder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act) will be restricted from seeking redemption rights with respect to 15% or more of the shares of the public shares. Accordingly, if a Public Shareholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the public shares, then any such shares in excess of that 15% limit would not be redeemed for cash.

Altimar II’s initial shareholders will not have redemption rights with respect to any ordinary shares owned by them, directly or indirectly.

You will be entitled to receive cash for any public shares to be redeemed only if you:

 

  (i)

(a) hold public shares or (b) hold units and you elect to separate your units into the underlying public shares and public warrants prior to exercising your redemption rights with respect to the public shares; and

 

  (ii)

prior to                 p.m., Eastern Time, on                  , 2021, (a) submit a written request to the transfer agent that Altimar II redeem your public shares for cash and (b) deliver your share certificates for your public shares (if any) to the transfer agent, physically or electronically through DTC.

An Altimar II shareholder may not withdraw a redemption request once submitted to Altimar II unless the board of directors of Altimar II determines (in its sole discretion) to permit the withdrawal of such redemption request (which they may do in whole or in part). Furthermore, if a holder of a public share delivers its certificate (if any) and other redemption forms in connection with an election of its redemption and subsequently decides prior to the applicable date not to elect to exercise such rights, it may simply request that Altimar II permit the withdrawal of the redemption request and instruct its transfer agent to return the certificate (physically or electronically). The holder can make such request by contacting the transfer agent, at the address or email address listed in this proxy statement/prospectus.

If the Business Combination is not approved or completed for any reason, then Altimar II’s Public Shareholders who elected to exercise their redemption rights will not be entitled to redeem their shares. In such case, Altimar II will promptly return any shares previously delivered by public holders.

If a Public Shareholder exercises its redemption rights, then it will be exchanging its redeemed public shares for cash and will no longer own those public shares. You will be entitled to receive cash for your public shares only if you properly exercise your right to redeem the public shares that you will hold upon the Domestication, no later than the close of the vote on the Business Combination Proposal, and deliver your ordinary shares (either physically or electronically) to the transfer agent, prior to                                  5:00 p.m., Eastern Time, on                 , 2021, and the Business Combination is consummated.

In order for Public Shareholders to exercise their redemption rights in respect of the Business Combination, Public Shareholders must properly exercise their right to redeem the public shares that you will hold upon the Domestication no later than the close of the vote on the Business Combination Proposal and deliver their ordinary shares (either physically or electronically) to the transfer agent, prior to                                  5:00 p.m., Eastern Time on                 , 2021. Therefore, the exercise of redemption rights occurs prior to the Domestication. For the purposes of Article 49.3 of the Amended and Restated Memorandum and Articles of Association of Altimar II and Cayman Islands law, the exercise of redemption rights shall be treated as an election to have such public shares repurchased for cash and references in this proxy statement/prospectus shall be interpreted accordingly. Immediately following the Domestication and the consummation of the Business Combination, Public Shareholders who properly exercised their redemption rights in respect of their public shares shall be paid.


 

33


Table of Contents

No Appraisal Rights

Altimar II’s shareholders will not have appraisal rights under Cayman Islands law or otherwise in connection with the Business Combination Proposal or the other Shareholder Proposals.

Proxy Solicitation

Proxies may be solicited by mail, telephone or in person. Altimar II has engaged Innisfree M&A Incorporated to assist in the solicitation of proxies. If a shareholder grants a proxy, it may still vote its shares in person if it revokes its proxy before the Special Meeting. A shareholder also may change its vote by submitting a later-dated proxy as described in the section entitled “The Extraordinary General Meeting — Revoking Your Proxy.”

Interests of Altimar II Directors and Officers in the Business Combination

In considering the recommendation of the board of directors of Altimar II to vote in favor of approval of the Business Combination Proposal, the Domestication Proposal, the Organizational Documents Proposal and the other Shareholder Proposals, shareholders should keep in mind that the Sponsor and certain members of the board of directors and officers of Altimar II and the Sponsor, including its directors and officers, have interests in such Shareholder Proposals that are different from, or in addition to, those of Altimar II’s shareholders generally. In particular:

 

   

If Altimar II does not consummate a business combination by February 9, 2023 (unless such date is extended in accordance with the Amended and Restated Memorandum and Articles of Association), it would cease all operations except for the purpose of winding up, redeeming all of the outstanding Class A ordinary shares for cash and, subject to the approval of its remaining shareholders and its board of directors, dissolving and liquidating, subject in each case to its obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the 8,625,000 Class B ordinary shares would be worthless because following the redemption of the Class A ordinary shares, Altimar II would likely have few, if any, net assets and because the holders of our Class B ordinary shares have agreed to waive their rights to liquidating distributions from the Trust Account with respect to the Class B ordinary shares if we fail to complete a Business Combination within the required period. Sponsor purchased the Class B ordinary shares prior to our initial public offering for approximately $0.003 per share. Assuming no redemptions by Altimar II Public Shareholders and therefore no forfeiture by the Altimar II Founders, the 8,625,000 shares of Class A common stock that the Altimar II Founders will hold following the Business Combination, if unrestricted and freely tradable, would have had aggregate market value of $                                  based upon the closing price of $                                  per share of public share on the NYSE on                 , the record date. Given such shares will be subject to lock-up restrictions, we believe such shares have less value.

 

   

Sponsor purchased 9,900,000 private placement warrants, each exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment, at a price of $1.00 per warrant, and such private placement warrants will expire and be worthless if a business combination is not consummated within 24 months of the consummation of the IPO (unless such date is extended in accordance with the Existing Organizational Documents).

 

   

Altimar II’s existing directors and officers will be eligible for continued indemnification and continued coverage under Altimar II’s directors’ and officers’ liability insurance after the Business Combination.

 

   

In order to protect the amounts held in the Trust Account, Sponsor has agreed that it will be liable to Altimar II if and to the extent any claims by a vendor for services rendered or products sold to Altimar


 

34


Table of Contents
 

II, or a prospective target business with which Altimar II has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account. This liability will not apply with respect to any claims by a third party who executed a waiver of any right, title, interest or claim of any kind in or to any monies held in the Trust Account or to any claims under our indemnity of the underwriters of Altimar II’s initial public offering against certain liabilities, including liabilities under the Securities Act.

 

   

Following consummation of the Business Combination, Sponsor, our officers and directors and their respective affiliates would be entitled to reimbursement for certain reasonable out-of-pocket expenses related to identifying, investigating and consummating an initial business combination, and repayment of any other loans, if any, and on such terms as to be determined by Altimar II from time to time, made by Sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination. However, if Altimar II fails to consummate a business combination within the required period, Sponsor and Altimar II’s officers and directors and their respective affiliates will not have any claim against the Trust Account for reimbursement.

 

   

Pursuant to the Registration Rights Agreement, the Altimar II Founders Holders will have customary registration rights, including demand, shelf and piggy-back rights, subject to cooperation and cut-back provisions, with respect to the shares of Fathom Class A common stock and warrants held by such parties.

 

   

For additional information regarding pre-existing relationships between certain of the parties to the Business Combination Agreement and certain of their affiliates, see “Risk Factors — Risks Related to the Business Combination and Altimar II — Pre-existing relationships between participants in the Business Combination and the related transactions or their affiliates could give rise to actual or perceived conflicts of interest in connection with the Business Combination.

Stock Exchange Listing

We expect to list the shares of Fathom Class A common stock and warrants to purchase shares of Class A common stock on the NYSE under the proposed symbols “FDMG” and “FDMG.WS,” respectively.

Sources and Uses of Funds

The following table summarizes the estimated sources and uses for funding the Business Combination assuming that none of Altimar II’s outstanding Class A ordinary shares are redeemed in connection with the Business Combination (“No Redemptions”) and excluding the impact of warrants and interest income on Trust Account.

Estimated Sources and Uses in millions (Assumes no redemptions by Public Shareholders and also excludes impact of warrants and interest income on Trust Account)

 

Sources

         

Uses

      

Proceeds from Trust Account

   $ 345     

Balance Sheet Contribution

   $ 25  

PIPE Investment

     80     

Closing Cash Consideration

     318  
     

Debt Pay-Down Amount

     22  
     

Transaction Costs

     60  
  

 

 

       

 

 

 

Total Sources

   $ 425     

Total Uses

   $ 425  
  

 

 

       

 

 

 

 

35


Table of Contents

Accounting Treatment of the Business Combination

The Business Combination will be accounted for using the acquisition method under the provisions of ASC 805, with Fathom being considered the acquiring entity and Fathom OpCo being considered the acquiree. For accounting purposes, the acquirer is the entity that has obtained control of another entity and thus, consummated a business combination. The determination of whether control has been obtained begins with the evaluation of whether control should be evaluated based on the variable interest or voting interest model pursuant to ASC 810. As defined by U.S. GAAP, if the acquiree is a variable interest entity, the primary beneficiary would always be the accounting acquirer. Fathom OpCo meets the definition of a variable interest entity and Fathom, which will be the managing member, has been determined to be the primary beneficiary. As a result, Fathom is considered to be the accounting acquirer.

Comparison of Corporate Governance and Shareholder Rights

Following the consummation of the Business Combination, the rights of Altimar II shareholders who become Fathom stockholders in the Business Combination will no longer be governed by Altimar II’s Amended and Restated Memorandum and Articles of Association (the “Existing Organizational Documents”) and instead will be governed by the Proposed Charter and the Proposed Bylaws of Fathom. See “The Domestication Proposal — Comparison of Corporate Governance and Shareholders.”

Summary of Risk Factors

You should consider carefully all of the risks described below, together with the other information contained in this proxy statement/prospectus, before voting on the Shareholder Proposals. For purposes of the below summary of risk factors, “we” and “our” refers to Fathom OpCo or Fathom, as the context may require. Such risks include, but are not limited to:

 

   

We are subject to risks related to the ongoing COVID-19 pandemic;

 

   

We may be subject to cybersecurity risks and changes to data protection regulation;

 

   

We face increasing competition in many aspects of our business;

 

   

We may not realize the anticipated benefits of our business acquisitions, and any acquisition, strategic relationship, joint venture or investment could disrupt our business and harm our operating results and financial condition;

 

   

If we are unable to manage our growth and expand our operations successfully, our reputation, brands, business and results of operations may be harmed;

 

   

Our success depends on our ability to deliver on-demand manufacturing capabilities and custom parts that meet the needs of our customers and to effectively respond to changes in our industry;

 

   

Our failure to meet our customers’ expectations regarding quick turnaround time, price or quality could adversely affect our business and results of operations;

 

   

We are subject to risks related to our dependency on our key management members and other key personnel, as well as attracting, retaining and developing qualified personnel in a highly competitive talent market;

 

   

The Proposed Charter will not limit the ability of the CORE Investors and their affiliates to compete with us;

 

   

We are subject to risks related to our dependency on Fathom OpCo to pay dividends, taxes, make payments under the Tax Receivable Agreement and pay other expenses;


 

36


Table of Contents
   

We may be subject to litigation risks and may face liabilities and damage to our professional reputation as a result;

 

   

Our businesses are subject to extensive domestic and foreign regulations that may subject us to significant costs and compliance requirements;

 

   

We are subject to risks related to effectuating the Domestication including potentially adverse tax consequences and less favorable shareholder rights under the DGCL than under Cayman Islands Law;

 

   

We are subject to risks related to the Tax Receivable Agreement;

 

   

We may be subject to risks related to our status as an emerging growth company within the meaning of the Securities Act;

 

   

Altimar II and Fathom OpCo are subject to risks that may prevent the consummation and completion of the Business Combination, including the approval of each Condition Precedent Proposal, the failure to meet closing conditions and the failure of the PIPE Investment to close;

 

   

Some of Altimar II’s officers and directors may have conflicts of interest that may influence or have influenced them to support or approve the Business Combination without regard to your interests or in determining whether Fathom is appropriate for Altimar II’s initial business combination;

 

   

Pre-existing relationships between participants in the Business Combination and the related transactions or their affiliates could give rise to actual or perceived conflicts of interest in connection with the Business Combination;

 

   

If third parties bring claims against Altimar II, the proceeds held in the Trust Account could be reduced and the per share redemption amount received by shareholders may be less than $10.00 per share;

 

   

You may only be able to exercise your Public Warrants on a “cashless basis” under certain circumstances, and if you do so, you will receive fewer Class A common stock from such exercise than if you were to exercise such warrants for cash;

 

   

The grant of registration rights to certain of our investors and the future exercise of such rights may adversely affect the market price of our Class A common stock;

 

   

We may have been a PFIC, which could result in adverse United States federal income tax consequences to U.S. investors;

 

   

We may amend the terms of the warrants in a manner that may be adverse to holders of Public Warrants with the approval by the holders of at least 50% of the then outstanding Public Warrants. As a result, the exercise price of the warrants could be increased, the exercise period could be shortened and the number of Class A ordinary shares purchasable upon exercise of a warrant could be decreased, all without approval of each warrant affected;

 

   

We have identified material weaknesses in our internal control over financial reporting. Failure to achieve and maintain effective internal control over financial reporting could result in our failure to accurately or timely report our financial condition or results of operations which could have a material adverse effect on our business and stock price; and

 

   

The compliance obligations of Altimar II and us under the Sarbanes-Oxley Act require substantial financial and management resources, and increase the time and costs of completing an acquisition.

Emerging Growth Company

Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) exempts emerging growth companies from being required to comply with new or revised financial accounting standards until


 

37


Table of Contents

private companies (that is, those that have not had a registration statement under the Securities Act declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of Altimar II’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of Altimar II’s IPO, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year’s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to “emerging growth company” have the meaning associated with it in the JOBS Act.


 

38


Table of Contents

SUMMARY HISTORICAL CONDENSED

FINANCIAL INFORMATION OF ALTIMAR II

Altimar II is providing the following summary historical financial information to assist you in your analysis of the financial aspects of the Business Combination.

Altimar II’s statement of operations data, cash flow data and balance sheet data as of June 30, 2021 are derived from Altimar II’s unaudited financial statements.

The information is only a summary and should be read in conjunction with Altimar II’s condensed financial statements and related notes and “Altimar II’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained elsewhere herein. The historical results included below and elsewhere in this proxy statement/prospectus are not indicative of the future performance of Altimar II.

 

     Six months ended
June 30, 2021
 

Statement of Operations Data:

  

Net income (loss)

                       
  

 

 

 

Balance Sheet Data (at period end):

  

Total assets

  

Total liabilities

  

Shareholder’s Equity:

  

Preference shares, $0.0001 par value; 5,000,000 shares authorized; no shares issued and outstanding

  

Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; 5,237,506 shares issued and outstanding (excluding 29,262,494 shares subject to possible redemption)

  

Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 8,625,000 shares issued and outstanding

  

Additional paid-in capital

  

Accumulated deficit

  

Total shareholders’ equity

  

Cash Flow Data:

  

Net loss:

  

Adjustments to reconcile net loss to net cash used in operating activities

  

Interest expense on marketable securities held in the Trust Account

  

Change in fair value of warrant liability

  

Transaction costs allocated to the Warrants

  

Changes in operating assets and liabilities

  

Prepaid expenses

  

Accrued expenses

  

Net cash used in operating activities

  

Non-cash investing and financing activities

  

Offering costs included in accrued offering costs

  

Offering costs paid through promissory note

  

Initial classification of Class A ordinary shares subject to possible redemption

  

Change in value of Class A ordinary shares subject to possible redemption

  

Deferred underwriting fee payable

  

Weighted average number of Class B ordinary shares outstanding (basic and diluted)

  

 

39


Table of Contents

SUMMARY HISTORICAL CONSOLIDATED

FINANCIAL INFORMATION OF FATHOM OPCO

The following tables present summary historical consolidated and combined financial data for the periods indicated of Fathom OpCo. The summary historical financial information of Fathom OpCo as of and for the years ended December 31, 2020 and 2019 was derived from the audited consolidated historical financial statements of Fathom OpCo included elsewhere in this proxy statement/prospectus. Our historical results are not necessarily indicative of the results that should be expected in the future.

The following summary historical consolidated financial data should be read in conjunction with the sections titled “Risk Factors”, “Fathom’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Fathom OpCo’s audited consolidated financial statements and the related notes included elsewhere in this proxy statement/prospectus.

Statements of Operations Data:

 

     Year Ended December 31,  
($ in thousands)          2020                 2019        

Revenue

   $ 61,289     $ 20,618  

Cost of revenue

     32,815       10,696  
  

 

 

   

 

 

 

Gross profit

     28,474       9,922  

Operating Expenses:

    

Selling, General and Administrative

     22,197       8,474  

Depreciation and Amortization

     4,825       1,605  
  

 

 

   

 

 

 

Total operating expenses

     27,022       10,079  
  

 

 

   

 

 

 

Operating income (loss)

     1,452       (157
  

 

 

   

 

 

 

Interest expense and other expense (income)

    

Interest expense

     3,665       1,616  

Other expense

     6,335       3,187  

Other income

     (585     (189
  

 

 

   

 

 

 

Total other expense, net

     9,415       4,614  
  

 

 

   

 

 

 

Net loss

     (7,963     (4,771
  

 

 

   

 

 

 

Balance Sheet Data:

 

     As of December 31,  
($ in thousands)    2020      2019  

Cash and cash equivalents

   $ 8,188      $ 1,026  

Working capital

     6,164        4,480  

Total assets

     207,490        92,237  

Total debt

     93,339        29,906  

Total liabilities

     117,366        37,502  

Total contingently redeemable preferred equity

     54,105        31,836  

Total members’ equity

     36,019        22,899  

 

40


Table of Contents

Cash Flows Data:

 

     Year Ended December 31,  
($ in thousands)          2020                 2019        

Cash provided by (used in):

    

Operating activities

   $ 1,870     $ (591

Investing activities

     (96,038     (44,368

Financing activities

     101,330       43,766  
  

 

 

   

 

 

 

Net increase (decrease) in cash and cash equivalents

     7,162       (1,193

Other Financial Data:

    
($ in thousands)             

Adjusted EBITDA(1)

   $ 10,417     $ 5,868  

 

(1)

The following table presents the reconciliation of net loss, the most comparable GAAP measure, to Adjusted EBITDA:

 

     Year Ended December 31,  
($ in thousands)          2020                 2019        

Net loss

   $ (7,963   $ (4,771

Adjusted for:

    

Depreciation and amortization

     7,392       2,659  

Interest expense

     3,665       1,616  

Income tax expense

     4       —    

Change in contingent consideration

     2,408       —    

Transaction-related costs (1)

     2,748       4,394  

Other non-operating costs (2)

     2,163       1,761  
  

 

 

   

 

 

 

Adjusted EBITDA

   $ 10,417     $ 5,868  
  

 

 

   

 

 

 

 

(1)

Mainly includes capital markets advisory, consulting, accounting and legal expenses in connection with mergers and acquisitions activities, including related evaluation, negotiation and integration costs, and capital-raising activities.

 

(2)

Includes adjustments to the fair value of contingent consideration and other acquisition-related items as well as other non-recurring, non-operating, and non-cash costs.

Fathom OpCo management uses Adjusted EBITDA to evaluate Fathom OpCo’s core operating performance and trends, and to make strategic decisions regarding the allocation of capital and new investments. We believe Adjusted EBITDA is useful in evaluating our operating performance, as they are similar to measures reported by our public competitors and are regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted EBITDA is not intended to be a substitute for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.


 

41


Table of Contents

SUMMARY UNAUDITED PRO FORMA CONDENSED COMBINED

FINANCIAL INFORMATION OF FATHOM OPCO

The following unaudited pro forma condensed combined financial information presents the combination of the financial information of Altimar Acquisition Corp. II (“Altimar II”) and Fathom Holdco, LLC (“Fathom OpCo”), adjusted to give effect to the Business Combination, the acquisitions of Incodema, Dahlquist, Majestic Metals, Mark Two, Newchem, and GPI completed in 2020 (collectively, the “2020 Acquisitions”) as discussed in further detail in Note 3 – Business Combination in the Fathom Holdco LLC Notes to the Consolidated Financial Statements and the acquisitions of Summit, Centex, Laser, Micropulse West and PPC completed in 2021 (collectively, the “2021 Acquisitions”) as discussed in further detail in Note 20 in the Fathom Holdco LLC Notes to the Consolidated Financial Statements. The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X.

The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020 combines the historical statements of operations of Altimar II, Fathom OpCo, and gives effect to the 2020 Acquisitions and the 2021 Acquisitions for such period on a pro forma basis as if the Business Combination and the 2020 Acquisitions and 2021 Acquisitions had been consummated and completed on January 1, 2020, the beginning of the period presented. The unaudited pro forma condensed combined financial information is not necessarily indicative of what the actual results of operations would have been had the Business Combination, the 2020 Acquisitions and the 2021 Acquisitions taken place on January 1, 2020, nor are they indicative of the future consolidated results of operations or financial position of Fathom Digital Manufacturing Corporation (“Fathom”) the post-combination company.

The unaudited pro forma condensed combined financial statements have been developed from and should be read in conjunction with:

 

   

the accompanying notes to the unaudited pro forma condensed combined financial statements;

 

   

the historical audited financial statements of Altimar II for the period from inception (December 7, 2020) through December 31, 2020 and related notes, found elsewhere in this proxy statement/prospectus;

 

   

the historical audited financial statements of Fathom OpCo for the year ended December 31, 2020, found elsewhere in this proxy statement/prospectus;

 

   

the historical combined audited financial statements of Incodema and Newchem for the year ended December 31, 2019, found elsewhere in this proxy statement/prospectus;

 

   

the historical audited financial statements of Dahlquist for the nine months ended September 30, 2020, found elsewhere in this proxy statement/prospectus;

 

   

the historical audited financial statements of Majestic Metals for the nine months ended September 30, 2020, found elsewhere in this proxy statement/prospectus; and

 

   

other information relating to Altimar II and Fathom OpCo contained in this proxy statement/prospectus, including the Business Combination Agreement and the description of certain terms thereof set forth in the section entitled “The Business Combination.”

Notwithstanding the legal form of the business combination pursuant to the Business Combination Agreement, the Business Combination will be accounted for in accordance with ASC 805, Business Combinations, using the acquisition method. For accounting purposes, the acquirer is the entity that has obtained control of another entity and, thus, consummated a business combination. The determination of whether control has been obtained begins with the evaluation of whether control should be evaluated based on the variable interest or voting interest model


 

42


Table of Contents

pursuant to ASC Topic 810, Consolidation (“ASC 810”). In all redemption scenarios, Fathom has been determined to be the accounting acquirer based on evaluation of the following factors:

 

   

Fathom OpCo is a variable interest entity (“VIE”). Fathom will be the sole managing member and primary beneficiary who has full and complete charge of all affairs of Fathom OpCo, and the Class A units of Fathom OpCo do not have substantive participating or kick out rights; and

 

   

No single party controls Fathom pre and post transaction, hence, the Business Combination is not considered a common control transaction.

The factors discussed above support the conclusion that Fathom will acquire a controlling financial interest in Fathom OpCo and will be the accounting acquirer. Fathom is the primary beneficiary of Fathom OpCo, which is a VIE, since it has the power to direct the activities of Fathom OpCo that most significantly impact Fathom OpCo’s economic performance through its role as the sole managing member of Fathom OpCo, and Fathom’s variable interests in Fathom OpCo include ownership of Fathom OpCo, which results in the right (and obligation) to receive benefits (and absorb losses) of Fathom OpCo that could potentially be significant to Fathom OpCo. Therefore, the Business Combination will be accounted for using the acquisition method. Under this method of accounting, Fathom is treated as the acquirer and Fathom OpCo is treated as the acquired company for financial statement reporting purposes. Upon the consummation of the Business Combination, the assets and liabilities of Fathom OpCo will be recognized at fair value, and any consideration in excess of the fair value of the net assets acquired (including identifiable intangible assets) will be recognized as goodwill.

The unaudited pro forma condensed combined financial information has been prepared using the assumptions below with respect to the potential redemption into cash of Altimar II’s Public Shares:

 

   

Assuming No Redemptions: This “minimum scenario” presentation assumes that none of the 29,262,494 Public Shares outstanding as of the record date are redeemed by Altimar II’s Public Shareholders.

 

   

Assuming Maximum Redemptions: This presentation assumes that Altimar II’s Public Shareholders redeem 11,200,000 shares of Altimar II’s Class A ordinary shares, the maximum number of shares of Altimar II Class A ordinary shares that may be redeemed for a pro rata portion of the funds in the Trust Account that would still allow Altimar II to satisfy the condition precedent in the Business Combination Agreement that as of immediately prior to the Business Combination, Altimar II have an Available Cash Amount of at least $313 million. This calculation assumes that the full $80 million in aggregate proceeds are received from the PIPE Investment and that the amount in the Trust Account (prior to any redemptions) is equal to $345 million (the amount in the Trust Account as of March 31, 2021), resulting in an aggregate redemption payment (based on an estimated redemption price per share of approximately $10) of $112 million and available Trust Account proceeds at closing of approximately $233 million. This scenario results in the following adjustments to (i) the consideration payable at closing and (ii) the number of Forfeited Shares:

 

   

Existing Fathom Owner Consideration: A reduction to the amount of the Closing Cash Consideration of $112 million, such that the Closing Cash Consideration will be equal to $206 million (assuming the Balance Sheet Contribution is $25 million and the Debt Pay-Down Amount is equal to $22 million), and a corresponding increase in the number of shares of Class A common stock and New Fathom Units that comprise the Closing Seller Equity Consideration equal to 11,200,000 (equal to the amount by which Closing Cash Consideration is reduced in this scenario divided by $10), such that the Closing Seller Equity Consideration will be an aggregate number of shares of Class A common stock and Class B common stock equal to 99,400,000.

 

   

Forfeited Shares: Under a Maximum Redemption scenario in which 11,200,000 shares of Altimar II’s Class A ordinary shares are redeemed, the Altimar II Founders will forfeit 968,750 shares of Class A common stock calculated pursuant to the terms of the Forfeiture and Support


 

43


Table of Contents
 

Agreement and the Business Combination Agreement. The Maximum Redemption Scenario results in an Altimar II Stock Redemption Ratio of 0.32, which is the quotient of (A) the number of shares of Altimar II Class A ordinary shares redeemed in the Altimar II Stock Redemption divided by (B) 34,500,000. This Altimar II Stock Redemption Ratio results in a Redemption Forfeiture Ratio of approximately 11.23%, as defined in the Business Combination Agreement, which is multiplied by the total aggregate number of then issued and outstanding shares of Altimar II Class C common stock immediately following the Domestication which is 8,625,000, resulting in 968,750 shares of Class A common stock forfeited by the Altimar II Founders.

Statement of Operations Data:

 

     For the Year Ended December 31, 2020  
     Pro Forma
Combined Assuming
No Redemptions
    Pro Forma Combined
Assuming Maximum
Redemptions
 

Revenue

   $ 110,583     $ 110,583  

Cost of revenue

     63,136       63,136  
  

 

 

   

 

 

 

Gross profit

     47,447       47,447  

Operating expenses

    

Selling, general, and administrative

     95,388       95,388  

Depreciation and amortization

     20,571       20,571  
  

 

 

   

 

 

 

Total operating expenses

     115,959       115,959  
  

 

 

   

 

 

 

Operating income (loss)

     (68,512     (68,512

Interest expense and other expense (income)

    

Interest expense/(income)

     5,888       5,888  

Other expense

     15,856       15,856  

Other (income)

     (2,842     (2,842
  

 

 

   

 

 

 

Total other expenses, net

     18,902       18,902  
  

 

 

   

 

 

 

NET LOSS BEFORE INCOME TAXES

     (87,414     (87,414

Provision for income taxes

     0       0  
  

 

 

   

 

 

 

NET LOSS

     (87,414     (87,414

Net loss attributable to noncontrolling interest

     (36,711     (41,745
  

 

 

   

 

 

 

Net loss attributable to Fathom

     (50,703     (45,669

Basic weighted average shares outstanding

     76,559,917       67,649,614  
  

 

 

   

 

 

 

Basic (loss) Per Share:

   $ (0.66   $ (0.68

Diluted weighted average shares outstanding

     76,559,917       67,649,614  
  

 

 

   

 

 

 

Diluted net income (loss) per share

   $ (0.66   $ (0.68 )
  

 

 

   

 

 

 

 

44


Table of Contents

Other Financial Information:

 

     Year Ended December 31,  
($ in thousands)          2020        

Pro forma adjusted EBITDA (1)

   $ 30,368  
  

 

 

 

 

(1)

The table below presents our Non-GAAP Pro Forma Adjusted EBITDA reconciled to pro forma net loss, the closest U.S. GAAP measure, for the period indicated.

Pro Forma Adjusted EBITDA is a non-GAAP performance measure presented to supplement our pro forma operating results prepared in accordance with U.S. GAAP, which we believe is useful in evaluating our pro forma operating performance presented above. Pro Forma Adjusted EBITDA, here prepared to give effect to the 2020 Acquisitions and 2021 Acquisitions as if they had been completed on January 1, 2020 is not intended to be a substitute for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measure of performance of other companies in other industries or within the same industry. We define and calculate Pro Forma Adjusted EBITDA as pro forma net losses before the impact of interest income or expense, income tax expense and depreciation and amortization, and further adjusted for the following items: stock-based compensation, transaction-related costs, and certain other non-cash and non-core items, as described in the reconciliation below:

 

     Year Ended
December 31,
 
($ in thousands)    2020  

Pro forma net loss

   $ 8,579  

Adjusted for:

  

Depreciation and amortization

     14,968  

Interest (income) expense, net

     7,470  

Income tax expense

     —    

Contingent consideration

     —    

Transaction-related costs (1)

     —    

Other non-operating costs (2)

     —    
  

 

 

 

Pro forma adjusted EBITDA

   $ 31,017  
  

 

 

 

 

(1)

Mainly includes capital markets advisory, consulting, accounting and legal expenses in connection with mergers and acquisitions activities, including related evaluation, negotiation and integration costs, and capital-raising activities. The transaction costs related to the 2020 Acquisitions and 2021 Acquisitions have been eliminated in calculating our pro forma net income for 2020 and 2019 pursuant to the principles of Article 11 of Regulation S-X.

(2)

Includes adjustments to the fair value of contingent consideration and other acquisition-related items as well as other non-recurring, non-operating, and non-cash costs.

For a detailed discussion of non-GAAP financial information included in this proxy statement/prospectus, including Pro Forma Adjusted EBITDA, see the section entitled, “Fathom’s Management’s Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Information.”


 

45


Table of Contents

COMPARATIVE HISTORICAL AND UNAUDITED PRO FORMA

PER SHARE FINANCIAL INFORMATION

The following table sets forth historical comparative per share information of Fathom OpCo, on a stand-alone basis, and the unaudited pro forma condensed combined per share information after giving effect to the Business Combination, assuming No Redemptions and Maximum Redemptions, respectively.

The historical information should be read in conjunction with the sections of this proxy statement/prospectus entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Fathom Holdco” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Altimar II,” as well as the historical financial statements and related notes thereto of each of Altimar II and Fathom OpCo included elsewhere in this proxy statement/prospectus. The unaudited pro forma condensed combined per share information is derived from, and should be read in conjunction with, the information contained in the section of this proxy statement/prospectus entitled “Unaudited Pro Forma Combined Financial Information.”

The unaudited pro forma combined share information does not purport to represent what the actual results of operations of Fathom OpCo would have been had the Business Combination been completed or to project Fathom OpCo’s results of operations that may be achieved after the Business Combination. The unaudited pro forma combined net income per share information below does not purport to represent what the actual results of operations of Fathom OpCo would have been had the Business Combination been completed or to project Fathom OpCo’s results of operations that may be achieved after the Business Combination. The unaudited pro forma shareholders’ equity per share information below does not purport to represent what the value of Altimar II equity and Fathom OpCo equity would have been had the Business Combination been completed nor the shareholders’ equity per share for any future date or period.

The following table sets forth:

 

   

Historical per share information of Altimar II for period from inception (December 7, 2020) through December 31, 2020;

 

   

Historical per share information of Fathom OpCo for the year ended December 31, 2020; and

 

   

Unaudited pro forma per share information of the combined company for the year ended December 31, 2020 after giving effect to the Business Combination, assuming the redemption scenarios as follows:

 

   

Assuming No Redemptions: The “No Redemptions” scenario assumes that no Altimar II Public Shareholders elect to redeem their shares of Altimar II Class A ordinary shares for a pro rata portion of the proceeds on deposit in the Trust Account, and thus the full amount held in the Trust Account as of the date of closing is available for the Business Combination; and

 

   

Assuming Maximum Redemptions: The “Maximum Redemptions” scenario assumes that Altimar II Public Shareholders redeem the maximum number of shares of Altimar II Class A ordinary shares for a pro rata portion of the funds in the Trust Account that would still allow Altimar II to satisfy the condition precedent in the Business Combination Agreement that as of immediately prior to the Business Combination, Altimar II have at least $313 million of available cash at the closing (excluding payment of any deferred underwriting fees and certain permitted transaction expenses of each of Altimar II and Fathom OpCo).


 

46


Table of Contents

In both scenarios, the amount of cash available is sufficient to (a) pay the Closing Cash Consideration and (b) pay transaction expenses.

 

     Altimar
Acquisition
Corp II (1)
    Fathom
Holdco,
LLC (2)
    Pro Forma
Combined
(Assuming
No
Redemptions)
    Pro Forma
Combined
(Assuming
Maximum
Redemptions)
 

Year Ended December 31, 2020

        

(in thousands except share and per share amounts)

        

Net income (loss)

   $ (5,000   $ (7,963   $ (87,414   $ (87,414

Altimar II Public Shares

        

Weighted average shares outstanding, basic and diluted—Class A ordinary shares

     N/A        

Basic and diluted income per share, Class A ordinary shares

     N/A        

Founder Shares

        

Weighted average shares outstanding, basic and diluted—Class B ordinary shares

     7,500,000        

Basic and diluted net loss per common share

   $ (0.00      

Fathom Shares

        

Weighted average shares outstanding, basic and diluted

         76,559,917       67,649,614  
      

 

 

   

 

 

 

Basic and diluted net loss per common share

       $ (0.66   $ (0.68

Cash distributions per common share

     N/A       N/A       N/A       N/A  

 

(1)

Excludes an aggregate of up to 1,125,000 shares of Class B ordinary shares which were subject to forfeiture if the over-allotment option was not exercised in full or in part by the underwriters (see Note 5 in the Altimar Acquisition Corp II 2020 Financial Statements).

(2)

Given Fathom OpCo’s historical equity structure, the calculation of historical Fathom OpCo per share data has been omitted.


 

47


Table of Contents

MARKET PRICE, TICKER SYMBOL AND DIVIDEND INFORMATION

Altimar II

Altimar II’s units, Class A ordinary shares and Public Warrants are currently listed on the NYSE under the symbols “ATMR.U”, “ATMR” and “ATMR.WS,” respectively.

The closing price of the units, Class A ordinary shares and Public Warrants on July 15, 2021, the last trading day before announcement of the execution of the Business Combination Agreement, was $9.75, and $1.31, respectively. As of                 , 2021 the record date for the Special Meeting, the most recent closing price of the units, Class A ordinary shares and Public Warrants was $    , $    and $    , respectively.

Holders of the units, Class A ordinary shares and public warrants should obtain current market quotations for their securities. The market price of Altimar II’s securities could vary at any time before the Business Combination.

Holders

As of March 31, 2021, there was one holder of record of Altimar II’s units, one holder of record of Altimar II’s Class A ordinary shares, and two holders of record of Altimar II’s public warrants. The number of holders of record does not include a substantially greater number of “street name” holders or beneficial holders whose units, public shares and public warrants are held of record by banks, brokers and other financial institutions.

Dividend Policy

Altimar II has not paid any cash dividends on its ordinary shares to date and does not intend to pay cash dividends prior to the completion of the Business Combination. The payment of cash dividends in the future will be dependent upon Fathom’s revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of the Business Combination. The payment of any cash dividends subsequent to the Business Combination will be within the discretion of Fathom’s board of directors at such time. Fathom’s ability to declare dividends may also be limited by restrictive covenants pursuant to any debt financing.

Fathom OpCo

Historical market price information for Fathom OpCo’s membership interests is not provided because there is no public market for any membership interest of Fathom OpCo.


 

48


Table of Contents

RISK FACTORS

In addition to the other information contained in this proxy statement/prospectus, the following risks have the potential to impact the business and operations of Fathom and Fathom OpCo. These risk factors are not necessarily exhaustive. We may face additional risks and uncertainties that are not presently known to us, or that we presently assess to be immaterial, which may also impair our business, financial condition or prospects. All investors are encouraged to perform their own investigation with respect to the business, financial condition and prospects of Fathom and the Business Combination. Unless otherwise indicated or the context otherwise requires, references in this “Risk Factors” section to “Fathom,” the “Company,” “we,” “our,” “us” and other similar terms refer to Fathom and its consolidated subsidiaries, including Fathom OpCo and each of its subsidiaries, after giving effect to the Business Combination.

Risks Related to Our Business Following the Business Combination

Following the Business Combination, the Company will be a holding company with no direct operations that relies on dividends, distributions, loans and other payments, advances and transfers of funds from Fathom OpCo to pay dividends, pay expenses and meet its other obligations. Accordingly, the Company’s securityholders will be subject to all of the risks of Fathom OpCo’s business following the Business Combination. Unless the context otherwise requires, all references in this section to the “Company,” “we,” “us” or “our” refer to Fathom OpCo’s business prior to the completion of the Business Combination, which will be the business of the combined company following the completion of the Business Combination. Accordingly, the risks described below relating to Fathom OpCo could also materially and adversely affect the combined company after the completion of the Business Combination.

Business Risks

We face significant competition and expect to face increasing competition in many aspects of our business, which could cause our operating results to suffer.

The digital manufacturing industry in which we operate is fragmented and highly competitive. We compete for customers with a wide variety of custom parts manufacturers and methods. Some of our current and potential competitors include captive in-house production capabilities, other custom parts manufacturers, brokers of custom parts and additive manufacturing vendors, including those utilizing 3D printing processes. Moreover, some of our existing and potential competitors are researching, designing, developing and marketing other types of products and manufacturing capabilities. We also expect that future competition may arise from the development or improvement of allied or related techniques for digital manufacturing, including from the issuance of patents to other companies that may inhibit our ability to compete effectively. Furthermore, our competitors may attempt to adopt and improve upon key aspects of our business model, such as development of technology that automates much of the manual labor conventionally required to quote and manufacture custom parts, implementation of interactive web-based and automated user interface and quoting systems and/or building scalable operating models specifically designed for efficient custom parts production. Third-party CAD software companies may develop software that mold-makers, injection molders and CNC machine shops could use to compete with our business model. Additive manufacturers may develop stronger, higher temperature resins or introduce other improvements that could more effectively compete with us on part quality. We may also, from time to time, establish alliances or relationships with other competitors or potential competitors, including 3D printer OEMs. To the extent companies terminate such relationships and establish alliances and relationships with our competitors, our business could be harmed.

Existing and potential competitors may have substantially greater financial, technical, marketing and sales, manufacturing, distribution and other resources and name recognition than us, as well as experience and expertise in intellectual property rights, any of which may enable them to compete effectively against us. For example, a number of companies that possess substantial resources have announced that they are beginning digital manufacturing initiatives, which will further strengthen the competition we face.

 

49


Table of Contents

Though we plan to continue to expend resources to develop new technologies, processes and manufacturing capabilities, we cannot assure you that we will be able to maintain our current competitive position or continue to compete successfully against current and future sources of competition. Our challenge in developing new business opportunities is identifying custom parts for which our automated quotation and digital manufacturing processes offer an attractive value proposition, and we may not be able to identify any new custom parts categories with favorable economics similar to our existing offerings. If we do not keep pace with technological change, demand for our offerings may decline and our operating results may suffer.

Our success depends on our ability to deliver on-demand manufacturing capabilities and custom parts that meet the needs of our customers and to effectively respond to changes in our industry.

We derive almost all of our revenue from the manufacture and sale to our customers of quick-turn, low volume custom parts for prototyping, support of internal manufacturing and limited quantity product release up to mid volume production requirements. Our business has been and, we believe, will continue to be, affected by changes in our customers’ new product and product line introductions, requirements and preferences, rapid technological change and the emergence of new standards and practices, any of which could render our technology and manufacturing capabilities less attractive, uneconomical or obsolete. To the extent that our customers’ need for quick-turn to mid-volume production parts decreases significantly for any reason, it would likely have a material adverse effect on our business and operating results and harm our competitive position. In addition, CAD simulation and other technologies may reduce the demand for physical prototype parts. Therefore, we believe that to remain competitive, we must continually expend resources to enhance and improve our technology and manufacturing capabilities.

In particular, we plan to increase our research and development efforts and to continue to focus a significant portion of those efforts to further develop our technology in areas such as our interactive project management platform and manufacturing processes, technology offerings and broaden the range of parts that we are able to manufacture. We believe successful execution of this part of our business plan is critical for our ability to compete in our industry and grow our business, and there are no guarantees we will be able to do so in a timely fashion, or at all. Broadening the range of parts and technologies that we are able to manufacture is of particular importance because limitations in manufacturability are the primary reason we are not able to fulfill many quotation requests. There are no guarantees that the resources we devote to executing on this aspect of our business plan will improve our business and operating results or result in increased demand for our custom parts and manufacturing capabilities. Failures in this area could adversely impact our operating results and harm our reputation and brands. Even if we are successful in executing in this area, our industry is subject to rapid and significant technological change, and our competitors may develop new technologies and manufacturing capabilities that are superior to ours.

Any failure to properly meet the needs of our customers or respond to changes in our industry on a cost-effective and timely basis, or at all, would likely have a material adverse effect on our business and operating results and harm our competitive position.

Our failure to meet our customers’ expectations regarding quick turnaround time, price or quality could adversely affect our business and results of operations.

We believe many of our customers are facing increased pressure from global competitors to be first to market with their finished products, often resulting in a need for quick turnaround of custom parts. We believe our ability to quickly quote, manufacture and ship custom parts has been an important factor in our results to date. There are no guarantees we will be able to meet customers’ increasing expectations regarding quick turnaround time. If we fail to meet our customers’ expectations regarding turnaround time in any given period, our business and results of operations will likely suffer.

Demand for our custom parts and manufacturing capabilities is sensitive to price. We believe our competitive pricing has been an important factor in our results to date. Therefore, changes in our pricing

 

50


Table of Contents

strategies can have a significant impact on our business and ability to generate revenue. Many factors, including our production and personnel costs and our competitors’ pricing and marketing strategies, can significantly impact our pricing strategies. If we fail to meet our customers’ price expectations in any given period, demand for our custom parts and manufacturing capabilities could be negatively impacted and our business and results of operations could suffer.

Most of our customers have a need for specific quality of quick-turn, on-demand custom parts. We believe our ability to create parts meeting our customers’ specifications and quality expectations is an important factor in our results to date. We cannot assure you that we will be able to continue to consistently manufacture custom parts that achieve the production specifications and quality that our customer expect. If we fail to meet our customers’ specifications and quality expectations in any given period, demand for our custom parts and manufacturing capabilities could be negatively impacted and our business and results of operations could suffer.

The strength of our brands is important to our business, and any failure to maintain and enhance our brands would hurt our ability to retain and expand our customer base as well as further penetrate existing customers.

Because our custom parts and manufacturing capabilities are sold primarily through our website, the success of our business depends upon our ability to attract new and repeat customers to our website in order to increase business and grow our revenue. Customer awareness and the perceived value of our brands will depend largely on the success of our marketing efforts, as well as our ability to consistently provide quality custom parts within the required timeframes and positive customer experiences, which we may not do successfully. A primary component of our business strategy is the continued promotion and strengthening of our brands. We may choose to increase our branding expense materially, but we cannot be sure that this investment will be profitable. If we are unable to successfully maintain and enhance our brands, this could have a negative impact on our business and ability to generate revenue.

Sales efforts to large customers involve risks that may not be present or that are present to a lesser extent with respect to sales to smaller organizations.

Attracting and retaining business from large enterprise customers is an element of our business strategy. Sales to large customers involve risks that may not be present or that are present to a lesser extent with sales to smaller organizations, such as longer sales cycles, more complex customer requirements, substantial upfront sales costs, less predictability in completing some of our sales and extended payment terms. A number of factors influence the length and variability of our sales cycle, including the need to educate potential customers about the uses and benefits of our platform, the various technologies available and manufacturing capabilities, the longer period of time for large customers to evaluate and test our project management platform prior to making a purchase decision and placing an order, the discretionary nature of purchasing and budget cycles and the competitive nature of evaluation and purchasing approval processes. As a result, the length of our sales cycle, from identification of the opportunity to deal closure, may vary significantly from customer to customer, with sales to large enterprises typically taking longer to complete. Moreover, larger organizations may demand more customization, which would increase our upfront investment in the sales effort with no guarantee that these customers will seek to use our manufacturing capabilities widely enough across their organization to justify our substantial upfront investment. A portion of these customers may purchase our offerings on payment terms, requiring us to assume a credit risk for non-payment in the ordinary course of business. If we fail to effectively manage these risks associated with sales to large customers, our business, financial condition and results of operations may be affected.

Our business depends in part on our ability to process a large volume of new custom part designs from a diverse group of customers and successfully identify significant opportunities for our business based on those submissions.

We believe the volume of new custom part designs we process and the size and diversity of our customer base give us valuable insight into the needs of our prospective customers. We utilize this industry knowledge to

 

51


Table of Contents

determine where we should focus our development resources. If the number of new custom part designs we process or the size and diversity of our customer base decrease, our ability to successfully identify significant opportunities for our business and meet the needs of customers could be negatively impacted. In addition, even if we do continue to process a large number of new custom part designs and work with a significant and diverse customer base, there are no guarantees that any industry knowledge we extract from those interactions will be successfully utilized to help us identify significant business opportunities or better understand the needs of our existing or prospective customers.

Wage increases and pressure in certain geographies may prevent us from sustaining our competitive advantage and may reduce our profit margin.

Measures are being taken in the United States and globally to increase minimum wages, and there is a shortage of skilled labor in certain locations leading to increased wage pressure. Similarly, with an increased global focus on environmental, social and corporate-governance concerns and sustainability, input costs have been steadily rising. In addition, enhanced federally subsidized unemployment benefits during the ongoing COVID-19 pandemic may have been contributing to labor shortages at some of our facilities. Accordingly, we may need to increase the levels of labor compensation more rapidly than in the past to remain competitive in attracting and retaining the quality and amount of labor that our business requires. To the extent that we are not able to control or share wage increases, wage increases may reduce our margins and cash flows, which could adversely affect our business.

The loss of one or more key members of our management team or personnel, or our failure to attract, integrate and retain additional personnel in the future, could harm our business and negatively affect our ability to successfully grow our business.

We are highly dependent upon the continued service and performance of the key members of our management team and other personnel. The loss of any of these individuals, each of whom is “at will” and may terminate his or her employment relationship with us at any time, could disrupt our operations and significantly delay or prevent the achievement of our business objectives. We believe that our future success will also depend in part on our continued ability to identify, hire, train and motivate qualified personnel. High demand exists for senior management and other key personnel (including technical, engineering, product, finance and sales personnel) in the digital manufacturing industry. A possible shortage of qualified individuals in the regions where we operate might require us to pay increased compensation to attract and retain key employees, thereby increasing our costs. In addition, we face intense competition for qualified individuals from numerous companies, many of whom have substantially greater financial and other resources and name recognition than us. We may be unable to attract and retain suitably qualified individuals who are capable of meeting our growing operational, managerial and other requirements, or we may be required to pay increased compensation in order to do so. For example, our failure to attract and retain shop floor employees may inhibit our ability to fulfill production orders for our customers. Our failure to attract, hire, integrate and retain qualified personnel could impair our ability to achieve our business objectives.

All of our employees are at-will employees, meaning that they may terminate their employment relationship with us at any time, and their knowledge of our business and industry would be extremely difficult to replace. We generally enter into non-competition agreements with our employees and certain consultants. These agreements prohibit our employees and applicable consultants from competing directly with us or working for our competitors or customers while they work for us, and in some cases, for a limited period after they cease working for us. We may be unable to enforce these agreements under the laws of the jurisdictions in which our employees and applicable consultants work and it may be difficult for us to restrict our competitors from benefiting from the expertise that our former employees or consultants developed while working for us. If we cannot demonstrate that our legally protectable interests will be harmed, we may be unable to prevent our competitors from benefiting from the expertise of our former employees or consultants and our ability to remain competitive may be diminished.

 

52


Table of Contents

Our growth strategy relies on business acquisitions. We may not realize the anticipated benefits of such acquisitions, and any acquisition, strategic relationship, joint venture or investment could disrupt our business and harm our operating results and financial condition.

Our business and customer base have been built in part through organic growth, but also through acquisitions of businesses that increase market share in our current markets or expand into other markets, or broaden our technology, intellectual property or product line capabilities. We have completed 13 acquisitions during the last three years, and we intend to continue to aggressively pursue attractive opportunities to enhance or expand our offerings through acquisitions, strategic relationships, joint ventures or investments that we believe may allow us to implement our growth strategy. For example, in December 2019, we acquired ICOMold to enable us to expand our existing SEO and SEM capabilities; during 2020 and 2021 to date, we completed six acquisitions that added CNC machining to our manufacturing capabilities, and three acquisitions that added precision sheet metal fabrication to our offerings. We cannot forecast the number, timing or size of any future acquisitions or other similar strategic transactions, or the effect that any such transactions might have on our operating or financial results. We may not be able to successfully identify future acquisition opportunities or complete any such acquisitions if we cannot reach agreement on commercially favorable terms, if we lack sufficient resources to finance the transaction on our own and cannot obtain financing at a reasonable cost or if regulatory authorities prevent such transactions from being completed.

Although we have substantial experience engaging in these types of transactions, such transactions may be complex, time consuming and expensive, and may present numerous challenges and risks including:

 

   

an acquired company, asset or technology not furthering our business strategy as anticipated;

 

   

difficulties entering and competing in new product or geographic markets and increased competition, including price competition;

 

   

integration challenges;

 

   

challenges in working with strategic partners and resolving any related disagreements or disputes;

 

   

high valuation for a company, asset or technology, or changes in the economic or market conditions or assumptions underlying our decision to make an acquisition;

 

   

significant problems or liabilities associated with acquired businesses, assets or technologies, including increased intellectual property and employment-related litigation exposure;

 

   

acquisition of a significant amount of goodwill, which could result in future impairment charges that would reduce our earnings; and

 

   

requirements to record substantial charges and amortization expense related to certain purchased intangible assets, deferred stock compensation and other items, as well as other charges or expenses.

Any one of these challenges or risks could impair our ability to realize any benefit from our acquisitions, strategic relationships, joint ventures or investments after we have expended resources on them, as well as divert our management’s attention. Any failure to successfully address these challenges or risks could disrupt our business and harm our operating results and financial condition. Moreover, any such transaction may not be viewed favorably by investors or other stakeholders.

If we proceed with a particular acquisition, we may have to use cash, issue new equity securities with dilutive effects on existing stockholders, incur indebtedness, assume contingent liabilities, or amortize assets or expenses in a manner that might have a material adverse effect on our financial condition and results of operations. Acquisitions will also require us to record certain acquisition-related costs and other items as current period expenses, which would have the effect of reducing our reported earnings in the period in which an acquisition is consummated. In addition, we could also face unknown liabilities or write-offs due to our acquisitions, which could result in a significant charge to our earnings in the period in which they occur. We will also be required to record any goodwill or other long-lived asset impairment charges in the periods in which they occur, which could result in a significant charge to our earnings in any such period.

 

53


Table of Contents

Achieving the expected returns and synergies from future acquisitions will depend, in part, upon our ability to integrate the products and services, technology, administrative functions and personnel of these businesses into our offering lines in an efficient and effective manner. We cannot assure you that we will be able to do so, that any acquired businesses will perform at levels and on the timelines anticipated by our management or that we will be able to obtain these synergies. In addition, acquired technologies and intellectual property may be rendered obsolete or uneconomical by our own or our competitors’ technological advances. Management resources may also be diverted from operating our existing businesses to certain acquisition integration challenges. If we are unable to successfully integrate acquired businesses, our anticipated revenues and profits may be lower. Our profit margins may also be lower, or diluted, following the acquisition of companies whose profit margins are less than those of our existing businesses.

In addition, from time to time we may enter into negotiations for acquisitions, relationships, joint ventures or investments that are not ultimately consummated. These negotiations could result in significant diversion of management time, as well as substantial out-of-pocket costs.

If we are unable to manage our growth and expand our operations successfully, our reputation and brands may be damaged, and our business and results of operations may be harmed.

Over the past several years, we have experienced rapid growth. For example, we have grown from 44 full-time employees as of October 31, 2018 to 622 full-time employees as of June 30, 2021. We expect this growth to continue and the number of facilities from which we operate to increase in the future. Our ability to effectively manage our anticipated growth and expansion of our operations will require us to do, among other things, the following:

 

   

enhance our operational, financial and management controls and infrastructure, human resource policies, and reporting systems and procedures;

 

   

effectively scale our operations, including accurately predicting the need for floor space, equipment, and additional staffing; and

 

   

successfully identify, recruit, hire, train, develop, maintain, motivate and integrate additional employees.

These enhancements and improvements will require significant capital expenditures and allocation of valuable management and employee resources. Furthermore, our growth has placed, and will continue to place, a strain on our operational, financial and management infrastructure. Our future financial performance and our ability to execute on our business plan will depend, in part, on our ability to effectively manage any future growth and expansion. There are no guarantees we will be able to do so in an efficient or timely manner, or at all. Our failure to effectively manage growth and expansion could have a material adverse effect on our business, results of operations, financial condition, prospects, reputation and brands, including impairing our ability to perform to our customers’ expectations.

We may not timely and effectively scale and adapt our existing technology, processes and infrastructure to meet the needs of our business.

A key element to our continued growth is the ability to quickly and efficiently quote an increasing number of customer submissions across geographic regions and to manufacture the related custom parts. This will require us to timely and effectively scale and adapt our existing technology, processes and infrastructure to meet the needs of our business. With respect to our website, project management platform and quoting technology, it may become increasingly difficult to maintain and improve their performance, especially during periods of heavy usage and as our solutions become more complex and our user traffic increases across geographic regions. Similarly, our manufacturing automation technology may not enable us to process the large numbers of unique designs and efficiently manufacture the related custom parts in a timely fashion to meet the needs of our

 

54


Table of Contents

customers as our business continues to grow. Any failure in our ability to timely and effectively scale and adapt our existing technology, processes and infrastructure could negatively impact our ability to retain existing customers and attract new customers, damage our reputation and brands, result in lost revenue, and otherwise substantially harm our business and results of operations.

We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all. If we are unable to raise additional capital when needed, our financial condition could be adversely affected and we may not be able to execute our growth strategy.

We intend to continue to make acquisitions and other investments to support our business growth and may require additional funds to respond to business challenges, including the need to complement our growth strategy, increase market share in our current markets or expand into other markets, or broaden our technology, intellectual property or manufacturing capabilities. Accordingly, we may need to obtain equity or debt financings to secure additional funds. If we raise additional funds through future issuances of equity or convertible debt securities, our existing stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our common stock. Any debt financing we secure in the future could involve restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. We may not be able to obtain additional financing on terms favorable to us, if at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to support our business growth and to respond to business challenges could be significantly impaired, and our business may be adversely affected.

Numerous factors may cause us not to maintain the revenue growth that we have historically experienced.

Although our revenue has grown from $20.6 million for the year ended December 31, 2019 to $61.3 million for the year ended December 31, 2020, we may not be able to maintain our historical rate of revenue growth. We believe that our continued revenue growth will depend on many factors, a number of which are out of our control, including among others, our ability to:

 

   

retain and further penetrate existing customers, as well as attract new customers;

 

   

consistently execute on custom part orders in a manner that satisfies our customers’ product needs and provides them with a superior experience;

 

   

develop new technologies or manufacturing processes and broaden the range of custom parts we offer;

 

   

capitalize on customers’ product expectations for access to comprehensive, user-friendly e-commerce capabilities 24 hours per day, 7 days per week;

 

   

increase the strength and awareness of our brands across geographic regions;

 

   

respond to changes in customers’ needs, technology and our industry;

 

   

react to challenges from existing and new competitors; and

 

   

respond to an economic recession which negatively impacts manufacturers’ ability to innovate and bring new products to market.

 

   

We cannot assure you that we will be successful in addressing the factors above and continuing to grow our business and revenue.

Errors or defects in the software we use or custom parts we manufacture could cause us to incur additional costs, lose revenue and business opportunities, damage our reputation and expose us to potential liability.

The sophisticated software we use and the often complex custom parts we manufacture may contain errors, defects or other performance problems at any point in the life of the software or custom parts. If errors or defects

 

55


Table of Contents

are discovered in our current or future software or in the custom parts we manufacture for customers, we may not be able to correct them in a timely manner or provide an adequate response to our customers. We may therefore need to expend significant financial, technical and management resources, or divert some of our development resources, in order to resolve or work around those defects. We may also experience an increase in our service and warranty costs. Particularly in the medical sector, errors or defects in our software or custom parts we manufacture could lead to claims by patients against us and our customers and expose us to lawsuits that may damage our and our customers’ reputations. Claims may be made by individuals or by classes of users. Our product liability and related insurance policies may not apply or sufficiently cover any product liability lawsuit that arises from defective software we may use or the custom parts we manufacture. Customers such as our collaboration partners may also seek indemnification for third party claims allegedly arising from breaches of warranties under our collaboration agreements.

Errors, defects or other performance problems in the software we use or custom parts we manufacture may also result in the loss of, or delay in, the market acceptance of our platform and digital manufacturing capabilities. Such difficulties could also cause us to lose customers and, particularly in the case of our largest customers, the potentially substantial associated revenue which would have been generated by our sales to companies participating in our customer’s supply chain. Technical problems, or the loss of a customer with a particularly important national or global reputation, could also damage our own business reputation and cause us to lose new business opportunities.

Interruptions to or other problems with our website, project management platform, information technology systems, manufacturing processes or other operations could damage our reputation and brands and substantially harm our business and results of operations.

The satisfactory performance, reliability, consistency, security and availability of our website and interactive project management platform, information technology systems, manufacturing processes and other operations are critical to our reputation and brands, and to our ability to effectively service customers. Any interruptions or other problems that cause any of our website, interactive project management platform or information technology systems to malfunction or be unavailable, or negatively impact our manufacturing processes or other operations, may damage our reputation and brands, result in lost revenue, cause us to incur significant costs seeking to remedy the problem and otherwise substantially harm our business and results of operations.

A number of factors or events could cause such interruptions or problems, including among others: human and software errors, design faults, challenges associated with upgrades, changes or new facets of our business, power loss, telecommunication failures, fire, flood, extreme weather, political instability, acts of terrorism, war, break-ins and security breaches, contract disputes, labor strikes and other workforce-related issues, capacity constraints due to an unusually large number of customers and potential customers accessing our website or project management platform or ordering parts at the same time, and other similar events. These risks are augmented by the fact that our customers come to us largely for our quick-turn low to mid-volume manufacturing capabilities and that accessibility and turnaround speed are often of critical importance to these customers. We are dependent upon our facilities through which we satisfy all of our production demands and in which we house all of the computer hardware necessary to operate our website and systems as well as managerial, customer service, sales, marketing and other similar functions, and we have not identified alternatives to these facilities or established fully redundant systems in multiple locations. In addition, we are dependent in part on third parties for the implementation and maintenance of certain aspects of our communications and production systems, and therefore preventing, identifying and rectifying problems with these aspects of our systems is to a large extent outside of our control.

Moreover, the business interruption insurance that we carry may not be sufficient to compensate us for the potentially significant losses, including the potential harm to the future growth of our business that may result from interruptions in our offerings and manufacturing processes as a result of system failures.

 

56


Table of Contents

If a natural or man-made disaster strikes any of our manufacturing facilities, we may be unable to manufacture our products for a substantial period of time and our sales will decline.

We manufacture all of our products in 12 manufacturing facilities located in the United States. These facilities and the manufacturing equipment we use would be costly to replace if damaged by a natural or man-made disaster, and could require substantial lead time to repair or replace. Our facilities may be harmed by natural or man-made disasters, including, without limitation, earthquakes, floods, tornadoes, fires, hurricanes, tsunamis, nuclear disasters, terrorist attacks, or as a result of the ongoing COVID-19 pandemic. In the event any of our facilities are affected by a disaster, we may:

 

   

be unable to meet the shipping deadlines of our customers;

 

   

experience disruptions in our ability to process submissions and generate quotations, manufacture and ship parts, provide marketing and sales support and customer service and otherwise operate our business, any of which could negatively impact our business;

 

   

be forced to rely on third-party manufacturers;

 

   

need to expend significant capital and other resources to address any damage caused by the disaster; and

 

   

lose customers and be unable to reacquire those customers.

Although we possess insurance for damage to our property and the disruption of our business from casualties, this insurance may not be sufficient to cover all of our potential losses and may not continue to be available to us on acceptable terms, or at all.

If our present single or limited source suppliers become unavailable or inadequate, our customer relationships, results of operations and financial condition may be adversely affected.

We acquire substantially all of the manufacturing equipment and certain of our materials that are critical to the ongoing operation and future growth of our business from third parties. We do not have long-term supply contracts with any of our suppliers and operate on a purchase-order basis. While most manufacturing equipment and materials for our products are available from multiple suppliers, certain of those items are only available from single or limited sources. Should any of our present single or limited source suppliers for manufacturing equipment or materials become unavailable or inadequate, or impose terms unacceptable to us such as increased pricing terms, we could be required to spend a significant amount of time and expense to develop alternate sources of supply, and we may not be successful in doing so on terms acceptable to us, or at all. Natural disasters, such as hurricanes or tornadoes, may affect our supply of materials, particularly resins, from time to time, and we may purchase larger amounts of certain materials in anticipation of future shortages or increases in pricing. In addition, if we were unable to find a suitable supplier for a particular type of manufacturing equipment or material, we could be required to modify our existing manufacturing processes and offerings to accommodate the situation. As a result, the loss of a single or limited source supplier could adversely affect our relationship with our customers and our results of operations and financial condition.

We are subject to payment-related risks.

We accept payments using a variety of methods, including credit card, customer invoicing, physical bank check and payment upon delivery. As we offer new payment options to our customers, we may be subject to additional regulations, compliance requirements and fraud risk. For certain payment methods, including credit and debit cards, we pay interchange and other fees, which may increase over time and raise our operating costs and lower profitability. We rely on third parties to provide payment processing services, including the processing of credit cards, debit cards or electronic checks, and it could disrupt our business if these companies become unwilling or unable to provide these services to us. We are also subject to payment card association operating rules, certification requirements and rules governing electronic funds transfers, which could change or be

 

57


Table of Contents

reinterpreted to make it difficult or impossible for us to comply. If we fail to comply with these rules or requirements, we may be subject to fines and higher transaction fees and lose our ability to accept credit and debit card payments from our customers, process electronic funds transfers, or facilitate other types of online payments, and our business and operating results could be adversely affected.

Workplace accidents or environmental damage could result in substantial remedial obligations and damage to our reputation.

Accidents or other incidents that occur at our manufacturing and other facilities or involve our personnel or operations could result in claims for damages against us. In addition, in the event we are found to be financially responsible, as a result of environmental or other laws or by court order, for environmental damages alleged to have been caused by us or occurring on our premises, we could be required to pay substantial monetary damages or undertake expensive remedial obligations. The amount of any costs, including fines or damages payments that we might incur under such circumstances, could substantially exceed any insurance we have to cover such losses. Any of these events, alone or in combination, could have a material adverse effect on our business, financial condition and results of operations and could adversely affect our reputation.

Interruptions, delays in service or inability to increase capacity at third-party data center facilities could adversely affect our business and reputation.

Our business, brands, reputation and ability to attract and retain customers depend upon the satisfactory performance, reliability and availability of our project management platform, depend upon the availability of the internet and our third-party service providers. We rely on third party data center facilities operated by Amazon Web Services (“AWS”), Ace Cloud Hosting (“Ace”), and Right Networks (“Right Networks”) to host our main servers. We do not control the operation of any of AWS’, Ace’s or Right Networks’ data center hosting facilities, and they may be subject to damage or interruption from earthquakes, floods, fires, power loss, telecommunications failures, terrorist attacks and similar events. They may also be subject to interruptions due to system failures, computer viruses, software errors or subject to breaches of computer hardware and software security, break-ins, sabotage, intentional acts of vandalism and similar misconduct. And while we rely on service level agreements with our hosting providers, if they do not properly maintain their infrastructure or if they incur unplanned outages, our customers may experience performance issues or unexpected interruptions and we may not meet our service level agreement terms with our customers. We have experienced, and expect that in the future we may experience interruptions, delays and outages in service and availability from time to time due to a variety of factors, including infrastructure changes, human or software errors, website hosting disruptions and capacity constraints. These and other similar events beyond our control could negatively affect the use, functionality or availability of our services.

Any damage to, or failure of, our systems, or those of our third-party providers, could interrupt or hinder the use or functionality of our website or project management platform. Resulting impairment of or interruptions of our business may reduce revenue, subject us to claims and litigation, cause customers to terminate their contracts and adversely affect our ability to attract new customers. If we are forced to switch hosting facilities, we may not be successful in finding an alternative service provider on acceptable terms or in hosting the computer servers ourselves. Our business will also be harmed if customers and potential customers believe our systems are unreliable.

The audit report we received with respect to our audited financial statements for the years ended December 31, 2020 and December 31, 2019 included emphasis of a matter regarding going concern. We must raise additional capital before April 29, 2022 to refinance our debt, and funding of the credit facilities provided for under our New Credit Agreement for this purpose is conditioned upon the completion of the Business Combination.

As of the date of this proxy statement/prospectus, the principal amount outstanding under Fathom OpCo’s 2021 Term Loan was $172 million. The 2021 Term Loan matures for repayment on April 29, 2022. If Fathom

 

58


Table of Contents

OpCo is unable to complete a significant capital transaction such as the Business Combination prior to April 9, 2022, and obtain funding of the credit facilities provided for under the New Credit Agreement, Fathom OpCo expects that it would not have sufficient funds on hand and from cash flow from operations to repay the 2021 Term Loan when it matures on April 29, 2022, which could result in our inability to continue as a going concern. The Business Combination is subject to customary closing conditions, some of which are out of Fathom OpCo’s control and, as a consequence, there can be no guarantee that the Business Combination and the funding of the credit facilities provided for under the New Credit Agreement will be completed. Accordingly, Grant Thornton LLP, Fathom OpCo’s independent registered public accounting firm, without modifying its opinion included a going concern emphasis paragraph in its audit report covering the audited financial statements of Fathom OpCo included in this proxy statement/prospectus. See the section entitled “Fathom Indebtedness” for a description of the 2021 Term Loan and the New Credit Agreement.

Industry Risks

The COVID-19 pandemic has adversely affected our business and results of operations. The duration and extent to which it will continue to adversely impact our business and results of operations remains uncertain and could be material.

The COVID-19 pandemic has resulted in a widespread public health crisis and numerous significant disease control measures being taken to limit its spread, including travel bans and restrictions, quarantines, shelter-in-place orders and shutdowns. These measures have materially impacted and may impact our workforce and operations, the operations of our customers, and those of our respective vendors and suppliers. Our operations are located in the United States, and domestic and global measures taken in effort to contain the pandemic has caused disruptions at some of our manufacturing operations and facilities as well as supplier facilities. Further such disruptions could occur in the future and any such disruptions could materially adversely affect our business. The impact of the pandemic on our business has included and could in the future include:

 

   

disruptions to or restrictions on our ability to ensure the continuous provision of our manufacturing services and solutions;

 

   

reductions in our capacity utilization levels;

 

   

temporary closures of our direct and indirect suppliers, resulting in adverse effects to our supply chain, and other supply chain disruptions, which adversely affect our ability to procure sufficient inventory to support customer orders;

 

   

temporary shortages of skilled employees available to staff manufacturing facilities due to shelter-in-place orders and travel restrictions within as well as into and out of countries;

 

   

restrictions or disruptions of transportation, such as reduced availability of air transport, port closures and increased border controls or closures;

 

   

increases in operational expenses and other costs related to requirements implemented to mitigate the impact of the pandemic;

 

   

delays or limitations on the ability of our customers to perform or make timely payments;

 

   

reductions in short- and long-term demand for our manufacturing services and solutions, or other disruptions in technology buying patterns;

 

   

workforce disruptions due to illness, quarantines, governmental actions, other restrictions and/or the social distancing measures we have taken to mitigate the impact of COVID-19 at our locations in an effort to protect the health and well-being of our employees, customers, suppliers and of the communities in which we operate (including certain employees working from home, restricting the number of employees attending events or meetings in person, limiting the number of people in our buildings and factories at any one time, further restricting access to our facilities and suspending employee travel); and

 

59


Table of Contents
   

our management team continuing to commit significant time, attention and resources to monitoring the COVID-19 pandemic and seeking to mitigate its effects on our business and workforce.

The global spread of COVID-19 also has created significant macroeconomic uncertainty, volatility and disruption, which may adversely affect our and our customers’ and suppliers’ liquidity, cost of capital and ability to access the capital markets. Even after the COVID-19 pandemic has subsided, we may continue to experience adverse impacts to our business as a result of the pandemic’s global economic impact, including any recession, economic downturn, government spending cuts, tightening of credit markets or increased unemployment that has occurred or may occur in the future, which could cause our customers and potential customers to postpone or reduce spending on our manufacturing services and solutions.

Global economic conditions may harm our ability to do business, increase our costs and negatively affect our stock price.

Our performance depends on the financial health and strength of our customers, which in turn is dependent on the economic conditions of the markets in which we and our customers operate. Declines in the global economy, difficulties in the financial services sector and credit markets, continuing geopolitical uncertainties, and other macroeconomic factors all affect the spending behavior of existing and potential customers.

We also face risks from financial difficulties or other uncertainties experienced by our suppliers, distributors or other third parties on which we rely. If third parties are unable to supply us with required materials or services or otherwise assist us in operating our business, our business could be harmed.

For example, the possibility of an ongoing trade war between the United States and China may impact the cost of raw materials, finished products or other materials used in our offerings and our ability to sell our offerings in China. Other changes in U.S. social, political, regulatory, and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment could also adversely affect our business. We could experience interruptions in production due to the processing of customs formalities or reduced customer spending in the wake of weaker economic performance. If global economic conditions remain volatile for a prolonged period our results of operations could be adversely affected.

If demand for our offerings and manufacturing capabilities does not grow as expected, or if market adoption of digital manufacturing does not continue to develop, or develops more slowly than expected, our revenues may stagnate or decline and our business may be adversely affected.

The industrial manufacturing market, which today is dominated by conventional manufacturing processes that do not involve digital manufacturing technology, is undergoing a shift towards digital manufacturing. We may not be able to develop effective strategies to raise awareness among potential customers of the benefits of digital manufacturing technologies or our offerings and manufacturing capabilities may not address the specific needs or provide the level of functionality required by potential customers to encourage the continuation of this shift towards digital manufacturing. If digital manufacturing technology does not continue to gain broader market acceptance as an alternative to conventional manufacturing processes, or if the marketplace adopts digital manufacturing technologies and capacities developed by our competitors, we may not be able to increase or sustain the level of sales of our offerings and our operating results would be adversely affected as a result.

We could face liability if our digital manufacturing solutions are used by our customers to print dangerous objects.

Customers may use our digital manufacturing offerings to produce parts that could be used in a harmful way or could otherwise be dangerous. For example, there have been news reports that 3D printers were used to print guns or other weapons. We have little, if any, control or knowledge over the parts we manufacture for our customers using our offerings, and it may be difficult, if not impossible, for us to monitor and prevent customers

 

60


Table of Contents

from having certain components of weapons or other dangerous objects manufactured with our services. While we have never digitally manufactured weapons for customers, there can be no assurance that we will not be held liable if someone were injured or killed by a weapon or other dangerous object containing a component part or parts manufactured for a customer using one of our offerings.

Because the digital manufacturing market is rapidly evolving, forecasts of market growth in this proxy statement/prospectus may not be accurate.

Market opportunity estimates and growth forecasts included in this proxy statement/prospectus are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. The forecasts and estimates in this proxy statement/prospectus relating to the expected size and growth of the markets for digital manufacturing technology and other markets in which we participate may prove to be inaccurate. Even if these markets experience the forecasted growth described in this proxy statement/prospectus, we may not grow our business at similar rates, or at all. Our future growth is subject to many factors, including continued market adoption of our offerings, which is subject to many risks and uncertainties. Accordingly, the forecasts and estimates of market size and growth described in this proxy statement/prospectus should not be taken as indicative of our future growth. In addition, these forecasts do not consider the impact of the ongoing global COVID-19 pandemic, and we cannot assure you that these forecasts will not be materially and adversely affected as a result.

Our actual results may be significantly different from our projections, estimates, targets or forecasts.

The projections, estimates, targets and forecasts contained in this proxy statement/prospectus are forward-looking statements that are based on assumptions that are inherently subject to significant uncertainties and contingencies, many of which are beyond our control. While all projections, estimates, targets and forecasts are necessarily speculative, we believe that the preparation of prospective financial information involves increasingly higher levels of uncertainty the further out in time the projection, estimate, target or forecast extends from the date of preparation. The assumptions and estimates underlying the projected, expected or target results are inherently uncertain and are subject to a wide variety of significant business, economic, regulatory and competitive risks and uncertainties that could cause actual results to differ materially from those contained in such projections, estimates, targets and forecasts. Our projections, estimates, targets and forecasts should not be regarded as an indication that Fathom OpCo or its representatives considered or consider such financial projections, estimates, targets and forecasts to be a reliable prediction of future events.

Intellectual Property and Infrastructure-Related Risks

We may not be able to adequately protect or enforce our intellectual property rights, which could impair our competitive position.

Our success and future revenue growth will depend, in part, on our ability to protect our intellectual property. We rely primarily on patents, licenses, trademarks and trade secrets, as well as non-disclosure agreements and other methods, to protect our proprietary technologies and processes globally. Despite our efforts to protect our proprietary technologies and processes, it is possible that competitors or other unauthorized third parties may obtain, copy, use or disclose our technologies and processes or invent around our patents. We cannot assure you that any of our existing or future patents will not be challenged or invalidated in court or patent office proceedings that could be time-consuming, expensive and distract us from operating our business. In addition, competitors could circumvent our patents by inventing around them. As such, any rights granted under these patents may not provide us with meaningful protection. We may not be able to obtain foreign patents corresponding to our United States patents. Even if foreign patents are granted, effective enforcement in foreign countries may not be available. If our patents and other intellectual property do not adequately protect our proprietary technology, our competitors may be able to offer product lines similar to ours. Our competitors may also be able to develop similar technology independently or design around our patents. Any of the foregoing events would lead to increased competition and lower revenue or gross margin, which would adversely affect our net income.

 

61


Table of Contents

We may incur substantial costs enforcing or acquiring intellectual property rights and defending against third-party claims as a result of litigation or other proceedings. Our failure to expand our intellectual property portfolio could adversely affect the growth of our business and results of operations.

We may incur substantial expense and costs in protecting, enforcing and defending our intellectual property rights against third parties. Intellectual property disputes may be costly and can be disruptive to our business operations by diverting attention and energies of management and key technical personnel and by increasing our costs of doing business. Third-party intellectual property claims asserted against us could subject us to significant liabilities, require us to enter into royalty and licensing arrangements on unfavorable terms, prevent us from providing our offerings to customers, subject us to injunctions prohibiting or restricting our sale of our offerings, or require us to redesign our offerings, causing severe disruptions to our operations or the marketplaces in which we compete or require us to satisfy indemnification commitments with our customers, including contractual provisions under various license arrangements. In addition, we may incur significant costs in acquiring the necessary third-party intellectual property rights for use in our offerings. Any of these could have an adverse effect on our business and financial condition.

Patent applications in the United States and most other countries are confidential for a period of time until they are published, and the publication of discoveries in scientific or patent literature typically lags actual discoveries by several months or more. As a result, the nature of claims contained in unpublished patent filings around the world is unknown to us, and we cannot be certain that we were the first to conceive inventions covered by our patents or patent applications or that we were the first to file patent applications covering such inventions. Furthermore, it is not possible to know in which countries patent holders may choose to extend their filings under the Patent Cooperation Treaty or other mechanisms.

In addition, we may be subject to intellectual property infringement claims from individuals, vendors and other companies, including those that are in the business of asserting patents, but are not commercializing products or services in the field of digital manufacturing, or our customers may seek to invoke indemnification obligations to involve us in such intellectual property infringement claims. Furthermore, although we maintain certain procedures to screen custom parts we manufacture on behalf of customers for infringement on the intellectual property rights of others, we cannot be certain that our procedures will be effective in preventing any such infringement. Any third-party lawsuits or other assertion to which we are subject, alleging infringement of trademarks, patents, trade secrets or other intellectual property rights either by us or by our customers may have a significant adverse effect on our financial condition.

Cybersecurity risks and cyber incidents, including cyber-attacks, could adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information and confidential information in our possession and damage to our business relationships, any of which could negatively impact our business, financial condition and operating results.

There has been an increase in the frequency and sophistication of the cyber and security threats we face, with attacks ranging from those common to businesses generally to those that are more advanced and persistent, which may target us due to our substantial reliance on information technology or otherwise. Cyber-attacks and other security threats could originate from a wide variety of sources, including cyber criminals, nation state hackers, hacktivists and other outside parties. As a result of the generally increasing frequency and sophistication of cyber-attacks, and our substantial reliance on technology, we may face a heightened risk of a security breach or disruption with respect to sensitive information resulting from an attack by computer hackers, foreign governments or cyber terrorists.

The operation of our business is dependent on computer hardware and software systems, as well as data processing systems and the secure processing, storage and transmission of information, which are vulnerable to security breaches and cyber incidents. A cyber incident is considered to be any adverse event that threatens the confidentiality, integrity or availability of our information resources. These incidents may be an intentional attack or

 

62


Table of Contents

an unintentional event and could involve gaining unauthorized access to our information systems for purposes of misappropriating assets, stealing confidential information, corrupting data or causing operational disruption. In addition, we and our employees may be the target of fraudulent emails or other targeted attempts to gain unauthorized access to proprietary or other sensitive information. The result of these incidents may include disrupted operations, misstated or unreliable financial data, fraudulent transfers or requests for transfers of money, liability for stolen information, increased cybersecurity protection and insurance costs, litigation and damage to our business relationships, causing our business and results of operations to suffer. Our reliance on information technology is substantial, and accordingly the risks posed to our information systems, both internal and those provided by third-party service providers are critical. We have implemented processes, procedures and internal controls designed to mitigate cybersecurity risks and cyber intrusions and rely on industry accepted security measures and technology to securely maintain confidential and proprietary information maintained on our information systems; however, these measures, as well as our increased awareness of the nature and extent of a risk of a cyber-incident, do not guarantee that a cyber-incident will not occur and/or that our financial results, operations or confidential information will not be negatively impacted by such an incident, especially because the cyber-incident techniques change frequently or are not recognized until launched and because cyber-incidents can originate from a wide variety of sources.

Those risks are exacerbated by the rapidly increasing volume of highly sensitive data, including our and our customers’ proprietary business information and intellectual property, and personally identifiable information of our employees and customers, that we collect and store in our data centers and on our networks. The secure processing, maintenance and transmission of this information are critical to our operations. A significant actual or potential theft, loss, corruption, exposure, fraudulent use or misuse of employee, customer or other personally identifiable or our or our customers’ proprietary business data, whether by third parties or as a result of employee malfeasance (or the negligence or malfeasance of third party service providers that have access to such confidential information) or otherwise, non-compliance with our contractual or other legal obligations regarding such data or intellectual property or a violation of our privacy and security policies with respect to such data could result in significant remediation and other costs, fines, litigation or regulatory actions against us and significant reputational harm.

Our proprietary digital manufacturing software contains third-party open-source software components. Our use of such open-source software may expose us to additional risks and harm our intellectual property and failure to comply with the terms of the underlying open-source software licenses could restrict our ability to sell our offerings.

Our proprietary digital manufacturing software contains components that are licensed under so-called “open source,” “free” or other similar licenses. Open source software is made available to the general public on an “as-is” basis under the terms of a non-negotiable license. We currently combine our proprietary software with open source software, but not in a manner that we believe requires the release of the source code of our proprietary software to the public. We do not plan to integrate our proprietary software with open source software in ways that would require the release of the source code of our proprietary software to the public; however, our use of open source software may entail greater risks than use of third-party commercial software. Open source licensors generally do not provide warranties or other contractual protections regarding infringement claims or the quality of the code. In addition, if we combine our proprietary software with open source software in a certain manner, we could, under certain open source licenses, be required to release to the public or remove the source code of our proprietary software. As is standard practice among technology companies, Fathom OpCo leverages open source software in the development of its internal software. Open source software is commonly used as a foundation to which Fathom OpCo develops upon, allowing us to customize the software based on the specific needs of Fathom. This approach enables faster development of high quality software. We may also face claims alleging noncompliance with open source license terms or infringement or misappropriation of proprietary software. These claims could result in litigation, require us to purchase a costly license or remove the open source software. In addition, if the license terms for open source software that we use change, we may be forced to re-engineer our solutions, incur additional costs or discontinue the sale of certain of our offerings if re-engineering could not be accomplished on a timely basis. Although we

 

63


Table of Contents

monitor our use of open source software to avoid subjecting our offerings to unintended conditions, there is a risk that these licenses could be construed in a way that could impose unanticipated conditions or restrictions on our ability to commercialize our offerings. We cannot guarantee that we have incorporated open source software in our proprietary software in a manner that will not subject us to liability or in a manner that is consistent with our current policies and procedures.

Compliance-Related Risks

Government regulation of the Internet and e-commerce is evolving, and unfavorable changes or failure by us to comply with these regulations could substantially harm our business and results of operations.

We are subject to general business regulations and laws as well as regulations and laws specifically governing the Internet and e-commerce. Existing and future laws and regulations may impede the growth of the Internet or other online services. These regulations and laws may cover taxation, restrictions on imports and exports, customs, tariffs, user privacy, data protection, pricing, content, copyrights, distribution, electronic contracts and other communications, consumer protection, the provision of online payment services, broadband residential Internet access and the characteristics and quality of the types of custom parts we manufacture or may manufacture in the future. It is not clear how existing laws governing issues such as property use and ownership, sales and other taxes, fraud, libel and personal privacy apply to the Internet and e-commerce, especially where these laws were adopted prior to the advent of the Internet and do not contemplate or address the unique issues raised by the Internet or e-commerce. Those laws that do reference the Internet are being interpreted by the courts and their applicability and reach are therefore uncertain. The costs of compliance with these regulations may increase in the future as a result of changes in the regulations or the interpretation of them. Further, any failures on our part to comply with these regulations may subject us to significant liabilities. Those current and future laws and regulations or unfavorable resolution of these issues may substantially harm our business and results of operations.

Aspects of our business are subject to privacy, data use and data security regulations, which may impact the way we use data to target customers.

Privacy and security laws and regulations may limit the use and disclosure of certain information and require us to adopt certain cybersecurity and data handling practices that may affect our ability to effectively market our manufacturing capabilities to current, past or prospective customers. In many jurisdictions consumers must be notified in the event of a data security breach, and such notification requirements continue to increase in scope and cost. The changing privacy laws in the United States, Europe and elsewhere — including the General Data Protection Regulation (GDPR) in the European Union, which became effective May 25, 2018, and the California Consumer Privacy Act of 2018, which was enacted on June 28, 2018 and became effective on January 1, 2020 — create new individual privacy rights and impose increased obligations, including disclosure obligations, on companies handling personal data. The impact of these continuously evolving laws and regulations could have a material adverse effect on the way we use data to digitally market and pursue our customers.

Our business involves the use of hazardous materials, and we and our suppliers must comply with environmental, health and safety laws and regulations, which can be expensive and restrict how we do business.

Our business involves the controlled storage, use and disposal of hazardous materials. We and our suppliers are subject to federal, state and local laws and regulations governing the use, manufacture, storage, handling and disposal of these hazardous materials. Although we believe that the safety procedures utilized by us and our suppliers for handling and disposing of these materials comply with the standards prescribed by these laws and regulations, we cannot eliminate the risk of accidental contamination or injury from these materials. In the event of an accident, federal, state or local authorities may curtail the use of these materials and interrupt our business

 

64


Table of Contents

operations. We do not currently maintain hazardous materials insurance coverage. If we are subject to any liability as a result of activities involving hazardous materials, our business and financial condition may be adversely affected and our reputation and brands may be harmed.

If we are unable to meet regulatory quality standards applicable to our manufacturing and quality processes for the parts we manufacture, our business, financial condition or operating results could be harmed.

As a manufacturer of CNC-machined and injection-molded custom parts, we conform to certain international standards, including International Organization for Standardization, or ISO, 9001:2015 for our injection molding facilities and the AS9100:2016 standard for our CNC-machining facilities in Hartland, WI, Pflugerville, TX, Tempe, AZ, Newark, NY. We conform to the ISO 9001:2015 standard for our plastics manufacturing and the AS9100:2016 standard for our metals manufacturing in In Hartland, WI, Pflugerville, TX, Tempe, AZ, and Newark, NY. We conform to the ISO 9001:2015 for our sheet metal custom parts and the AS9100:2016 standards for our CNC-machined custom parts in Hartland, WI, Pflugerville, TX, Tempe, AZ, and Newark, NY. We also conform to international standard ISO 9001:2015 at our manufacturing facilities in Hartland, WI, Oakland, CA, Newark, NY, Pflugerville, TX, Denver, CO, Round Rock, TX, Tempe, AZ, Miami Lakes, FL, and Elk Grove, IL. We conform to the NIST 800-171 standard at our facilities in Oakland, CA and Tempe, AZ. We conform to the ITAR standard at our facilities in Hartland, WI, Oakland, CA, Ithaca, NY, Denver, CO, Tempe, AZ, and Newark, NY. Additionally, we conform to international standard ISO 13485 at our manufacturing facilities in Round Rock, TX and Miami Lakes, FL. If any system inspection reveals that we are not in compliance with applicable standards, registrars may take action against us, including issuing a corrective action request or discontinuing our certifications. If any of these actions were to occur, it could harm our reputation as well as our business, financial condition and operating results.

We are subject to environmental, health and safety laws and regulations related to our operations and the use of our digital manufacturing systems and consumable materials, which could subject us to compliance costs and/or potential liability in the event of non-compliance.

We are subject to environmental laws and regulations governing our manufacturing operations, including, but not limited to, emissions into the air and water and the use, handling, disposal and remediation of hazardous substances. A certain risk of environmental liability is inherent in our production activities. These laws and regulations govern, among other things, the generation, use, storage, registration, handling and disposal of chemicals and waste materials, the emission and discharge of hazardous materials into the ground, air or water, the cleanup of contaminated sites, including any contamination that results from spills due to our failure to properly dispose of chemicals and other waste materials, and the health and safety of our employees. Under these laws, regulations and requirements, we could also be subject to liability for improper disposal of chemicals and waste materials. Accidents or other incidents that occur at our facilities or involve our personnel or operations could result in claims for damages against us. In the event we are found to be financially responsible, as a result of environmental or other laws or by court order, for environmental damages alleged to have been caused by us or occurring on our premises, we could be required to pay substantial monetary damages or undertake extensive remedial obligations. If our operations fail to comply with such laws or regulations, we may be subject to fines and other civil, administrative or criminal sanctions, including the revocation of permits and licenses necessary to continue our business activities. In addition, we may be required to pay damages or civil judgments in respect of third-party claims, including those relating to personal injury (including exposure to hazardous substances that we generate, use, store, handle, transport, manufacture or dispose of), property damage or contribution claims. Some environmental laws allow for strict and joint and several liabilities for remediation costs, regardless of fault. We may be identified as a potentially responsible party under such laws. The amount of any costs, including fines or damages payments that we might incur under such circumstances, could substantially exceed any insurance we have to cover such losses. Any of these events, alone or in combination, could have a material adverse effect on our business, financial condition and results of operations and could adversely affect our reputation.

 

65


Table of Contents

The cost of complying with current and future environmental, health and safety laws applicable to our operations, or the liabilities arising from past releases of, or exposure to, hazardous substances, may result in future expenditures. Any of these developments, alone or in combination, could have an adverse effect on our business, financial condition and results of operations.

We are subject to anti-corruption laws, trade controls, economic sanctions and similar laws and regulations. Our failure to comply with these laws and regulations could subject us to civil, criminal and administrative penalties and harm our reputation.

We service customers located in a number of countries throughout the world. Doing business with foreign customers subjects us to U.S. and other anti-corruption laws and regulations imposed by governments around the world with jurisdiction over such commerce with foreign customers, including the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act 2010, as well as the laws of the countries where we do business. Failure to comply with these anti-corruption laws and regulations could subject us to civil, criminal, and administrative penalties and harm our reputation. We are also subject to various U.S., international, and regional trade laws, including trade and economic sanctions and export controls, imposed by governments around the world with jurisdiction over our commerce with foreign customers. We are also subject to embargoes, sanctions, and trade and export controls imposed by the United States and other governments restricting or prohibiting sales to or transactions with specific persons or jurisdictions or the provision of certain items, based on their classification, to certain jurisdictions or persons or for certain end use purposes. Failure to comply with these embargoes, sanctions, and trade and export controls could subject us to civil, criminal and administrative penalties and harm our reputation. These embargoes, sanctions, and trade and export controls can change rapidly with little to no notice, and therefore, our current and future offerings could become subject to heightened restrictions, which could increase our compliance costs and our risks of potential non-compliance in these areas.

Risks of Being a Public Company

Our management team has limited experience managing a public company and may not successfully manage our transition to public company status.

Most members of our management team have limited experience managing a publicly-traded company, interacting with public company investors and complying with the increasingly complex laws pertaining to public companies. Our management team may not successfully or efficiently manage our transition to being a public company that is subject to significant regulatory oversight and reporting obligations under the federal securities laws and the continuous scrutiny of securities analysts and investors. These new obligations and constituents will require significant attention from our senior management and could divert their attention away from the day-to-day management of our business, which could harm our business, results of operations and financial condition.

The requirements of being a public company may strain our resources, divert management’s attention and affect its ability to attract and retain qualified board members.

After the completion of the Business Combination, we will be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and any rules promulgated thereunder, as well as the rules of NYSE. The requirements of these rules and regulations increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly, and increase demand on its systems and resources. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal controls for financial reporting. In order to maintain and, if required, improve our disclosure controls and procedures and internal control over financial reporting to meet this standard, significant resources and management oversight will be required and, as a result, management’s attention may be diverted from other business concerns. These rules and regulations can also make it more difficult for us to attract and retain qualified independent members of

 

66


Table of Contents

our board of directors. Additionally, these rules and regulations make it more difficult and more expensive for us to obtain director and officer liability insurance. We may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. The increased costs of compliance with public company reporting requirements and our potential failure to satisfy these requirements can have a material adverse effect on our operations, business, financial condition or results of operations.

We have identified material weaknesses in our internal control over financial reporting. resulting from control deficiencies in our IT general controls and process level controls. Failure to achieve and maintain effective internal control over financial reporting could result in our failure to accurately or timely report our financial condition or results of operations, which could have a material adverse effect on our business and stock price.

Upon consummation of the Business Combination, Fathom will be required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which will require management to certify financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness of our controls over financial reporting. Although we will be required to disclose changes made in our internal controls and procedures on a quarterly basis, we will not be required to make our first annual assessment of our internal controls over financial reporting pursuant to Section 404 until our annual report on Form 10-K for the fiscal year ending December 31, 2022. This assessment will need to include disclosure of any material weaknesses identified by our management in our internal control over financial reporting, as well as a statement that our independent registered public accounting firm has issued an opinion on the effectiveness of our internal control over financial reporting, provided that our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting until our first annual report required to be filed with the Securities and Exchange Commission, or SEC, following the later of the date we are deemed to be an “accelerated filer” or a “large accelerated filer,” each as defined in the Exchange Act, or the date we are no longer an emerging growth company, as defined in the JOBS Act.

In connection with the audit of our financial statements for the year ended December 31, 2020, we identified material weaknesses relating to our internal control over financial reporting relating to IT general controls, the design of our financial reporting system and the segregation of duties in the financial reporting process. A “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our consolidated financial statements will not be prevented or detected on a timely basis.

Management is working to remediate the material weaknesses by hiring additional qualified accounting and financial reporting personnel, and further evolving our accounting processes. We may not be able to fully remediate these material weaknesses until these steps have been completed and have been operating effectively for a sufficient period of time. We cannot assure you that the measures we have taken to date and plan to take will be sufficient to remediate the material weakness we identified or avoid the identification of additional material weaknesses in the future. If we are not able to maintain effective internal control over financial reporting, our financial statements and related disclosures may be inaccurate, which could have a material adverse effect on our business and our stock price.

Through their ownership of our common stock, “negative control” rights and their rights to nominate directors to our board under the Investor Rights Agreement, the CORE Investors will have substantial influence over our management and policies, and their interests may conflict with ours or yours in the future.

Immediately following completion of the Business Combination, the CORE Investors will beneficially own approximately 45% of our Class A common stock and Class B common stock, which will generally vote together as a single class on matters submitted to a vote of our stockholders, including the election of directors (or 51.5% assuming maximum redemptions by Altimar II Public Shareholders). As a result, the CORE Investors will have the ability to influence our business and affairs through “negative control” rights through their ownership of our

 

67


Table of Contents

Class A common stock combined with certain supermajority voting provisions of the Proposed Charter and Proposed Bylaws, their general ability to vote on the election of directors to our board and the provisions in the Investor Rights Agreement described below. If the other holders of our Class A common stock are dissatisfied with the performance of our board of directors, they have no ability to remove any of our directors, unless for cause and then only upon the affirmative vote of holders of 66-2/3% of our outstanding Class A common stock and Class B common stock, voting as a single class.

In addition, in connection with the Business Combination, we will enter into the Investor Rights Agreement with the CORE Investors which will provide for an initial eleven-person board of directors, consisting of ten individuals to be designated by the CORE Investors, and one independent director to be mutually agreed by the CORE Investors and the Sponsor. The CORE Investors will have certain continued nomination rights for a number of directors ranging from the majority of the board of directors to one director, while they beneficially own shares of common stock in excess of certain ownership percentage of the amount owned by the CORE Investors at Closing, as determined in accordance with the Investor Rights Agreement. In addition, for so long as the CORE Investors beneficially own shares of common stock representing at least 5% of the amount owned by the CORE Investors at Closing, the CORE Investors will have the right to designate a person to attend meetings of our board (including any meetings of any committees thereof) in a non-voting observer capacity. See “The Business Combination Agreement – Related Agreements – Investor Rights Agreement and Registration Rights Agreement” for more details with respect to the Investor Rights Agreement.

The CORE Investors and their affiliates engage and will continue to engage in a broad spectrum of activities, including investments in the manufacturing and industrial industries generally, and engage and may continue to engage in the same or similar activities or related lines of business as those in which we are engaged or may engage in, directly or indirectly. In the ordinary course of their business activities, the CORE Investors and their affiliates may engage in activities in which their interests conflict with our interests or those of our other shareholders, such as investing in or advising businesses that directly or indirectly compete with certain portions of our business or are suppliers or partners of ours. Our Proposed Charter will provide that none of the CORE Investors, any of their affiliates or any director who is not employed by us (including any non-employee director who serves as one of our officers in both his director and officer capacities) or its affiliates will have any duty to refrain from engaging, directly or indirectly, in the same business activities or similar business activities or lines of business in which we operate. The CORE Investors and their affiliates also may pursue acquisition opportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us. In addition, the CORE Investors and their affiliates may have an interest in pursuing acquisitions, divestitures and other transactions that, in their judgment, could enhance their investment, even though such transactions might involve risks to you.

Under SEC Rules, we will be an “emerging growth company” and a “smaller reporting company” and the reduced SEC disclosure requirements applicable to emerging growth companies and smaller reporting companies may make our common stock less attractive to investors.

As a newly public company, we will be “emerging growth company,” as defined in the JOBS Act. As an emerging growth company we may follow reduced disclosure requirements and do not have to make all of the disclosures that public companies that are not emerging growth companies do. We will remain an emerging growth company until the earlier of (a) the last day of the fiscal year in which we have total annual gross revenues of $1.0 billion or more (as adjusted for inflation); (b) the last day of the fiscal year following the fifth anniversary of the date of the completion of the initial public offering of Fathom; (c) the date on which we have issued more than $1 billion in nonconvertible debt during the previous three years; or (d) the date on which we are deemed to be a large accelerated filer under the rules of the SEC, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30. For so long as we remain an emerging growth company, we are permitted and intend to rely on exemptions from certain disclosure

 

68


Table of Contents

requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include:

 

   

not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

 

   

not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);

 

   

reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and

 

   

exemptions from the requirements of holding a nonbinding advisory vote of stockholders on executive compensation, stockholder approval of any golden parachute payments not previously approved and having to disclose the ratio of the compensation of our chief executive officer to the median compensation of our employees.

In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to use the extended transition period for complying with new or revised accounting standards; and as a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.

We may choose to take advantage of some, but not all, of the available exemptions for emerging growth companies. We cannot predict whether investors will find our common stock less attractive if we rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our share price may be more volatile.

In order to satisfy our obligations as a public company, we will need to hire qualified accounting and financial personnel with appropriate public company experience.

As a newly public company, we will need to establish and maintain effective disclosure and financial controls and make changes in our corporate governance practices. We may need to hire additional accounting and financial personnel with appropriate public company experience and technical accounting knowledge, and it may be difficult to recruit and retain such personnel. Even if we are able to hire appropriate personnel, our existing operating expenses and operations will be impacted by the direct costs of their employment and the indirect consequences related to the diversion of management resources from research and development efforts.

The Company may be subject to securities litigation, which is expensive and could divert management attention.

Following the Business Combination, the per share price of the Class A common stock may be volatile and, in the past, companies that have experienced volatility in the market price of their stock have been subject to securities litigation, including class action litigation. Litigation of this type could result in substantial costs and diversion of management’s attention and resources, which could have a material adverse effect on our business, financial condition, and results of operations. Any adverse determination in litigation could also subject the Company to significant liabilities.

 

69


Table of Contents

Risks Related to our Structure and Governance

Upon completion of the Business Combination, the rights of holders of Fathom’s common stock arising under the DGCL will differ from and may be less favorable to the rights of holders of Altimar II’s ordinary shares arising under Cayman Islands law.

Upon completion of the Business Combination, the rights of holders of Fathom’s common stock will arise under the DGCL. The DGCL contains provisions that differ in some respects from those in the Cayman Islands Companies Act, and, therefore, some rights of holders of Fathom’s common stock could differ from the rights that holders of Altimar II ordinary shares currently possess. For instance, while class action lawsuits are generally not available to shareholders under Cayman Islands law, such actions are generally available under Delaware law. This change could increase the likelihood that Fathom becomes involved in costly litigation, which could have a material adverse effect on Fathom

For a more detailed description of the rights of holders of Fathom’s common stock under the DGCL and how they may differ from the rights of holders of Altimar II ordinary shares under Cayman Islands law, please see the section entitled “The Domestication Proposal — Comparison of Corporate Governance and Shareholders.

Delaware law, the Proposed Charter and Proposed Bylaws will contain certain provisions, including anti-takeover provisions, that limit the ability of stockholders to take certain actions and could delay or discourage takeover attempts that stockholders may consider favorable.

The Proposed Charter and Proposed Bylaws that will be in effect upon completion of the Business Combination differ from the Amended and Restated Memorandum and Articles of Association. Among other differences, the Proposed Charter and the DGCL contain provisions that could have the effect of rendering more difficult, delaying, or preventing an acquisition deemed undesirable by the Fathom Board and therefore depress the trading price of Fathom’s Class A common stock. These provisions could also make it difficult for stockholders to take certain actions, including electing directors who are not nominated by the current members of the Fathom Board or taking other corporate actions, including effecting changes in management. Among other things, the Proposed Charter and Proposed Bylaws include provisions regarding:

 

   

a classified board of directors with three-year staggered terms, which could delay the ability of stockholders to change the membership of a majority of the Fathom Board;

 

   

the ability of the Fathom Board to issue shares of preferred stock, including “blank check” preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;

 

   

the limitation of the liability of, and the indemnification of, Fathom’s directors and officers;

 

   

the right of the Fathom Board to elect a director to fill a vacancy created by the expansion of the Fathom Board or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on the Fathom Board;

 

   

the requirement that directors may only be removed from the Fathom Board for cause;

 

   

the requirement that a special meeting of stockholders may be called only by the Fathom Board or the chairman of the Fathom Board, which could delay the ability of stockholders to force consideration of a proposal or to take action, including the removal of directors;

 

   

controlling the procedures for the conduct and scheduling of the Fathom Board and stockholder meetings;

 

   

the ability of the Fathom Board to amend the Proposed Bylaws, which may allow the Fathom Board to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend the Proposed Bylaws to facilitate an unsolicited takeover attempt; and

 

70


Table of Contents
   

advance notice procedures with which stockholders must comply to nominate candidates to the Fathom Board or to propose matters to be acted upon at a stockholders’ meeting, which could preclude stockholders from bringing matters before annual or special meetings of stockholders and delay changes in the composition of the Fathom Board and also may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of the Company.

These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in the Fathom board or management.

In addition, as a Delaware corporation, Fathom will generally be subject to provisions of Delaware law, including the DGCL, although Fathom will elect not to be governed by Section 203 of the DGCL.

Any provision of the Proposed Charter, Proposed Bylaws or Delaware law that has the effect of delaying or preventing a change in control could limit the opportunity for stockholders to receive a premium for their shares of Fathom’s capital stock and could also affect the price that some investors are willing to pay for Fathom’s common stock.

The form of the Proposed Charter is attached as Annex A to this proxy statement/prospectus, and the form of the Proposed Bylaws is attached as Annex B to this proxy statement/prospectus, and we urge you to read each of them.

In addition, the provisions of the Investor Rights Agreement, as described herein, provide the stockholders party thereto with certain board representation and other consent rights that could also have the effect of delaying or preventing a change in control.

The Proposed Charter will designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by Fathom’s stockholders, which could limit Fathom’s stockholders’ ability to obtain a favorable judicial forum for disputes with Fathom or its directors, officers or other employees.

The Proposed Charter will provide that, unless Fathom consents in writing to the selection of an alternative forum, (a) any derivative action or proceeding brought on behalf of Fathom, (b) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, other employee, agent or stockholder of Fathom to Fathom or Fathom’s stockholders, or any claim for aiding and abetting such alleged breach, (c) any action asserting a claim against Fathom or any current or former director, officer, other employee, agent or stockholder of Fathom (i) arising pursuant to any provision of the DGCL, the Proposed Charter (as it may be amended or restated) or the Proposed Bylaws or (ii) as to which the DGCL confers jurisdiction on the Delaware Court of Chancery or (d) any action asserting a claim against Fathom or any current or former director, officer, other employee, agent or stockholder of Fathom governed by the internal affairs doctrine of the law of the State of Delaware shall, as to any action in the foregoing clauses (a) through (b), to the fullest extent permitted by law, be solely and exclusively brought in the Delaware Court of Chancery; provided, however, that the foregoing shall not apply to any claim arising under federal securities laws, including the Securities Act as to which the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the sole and exclusive forum. Notwithstanding the foregoing, the provisions of Article XI of the Proposed Charter will not apply to suits brought to enforce any liability or duty created by the Exchange Act, or any other claim for which the federal district courts of the United States of America shall be the sole and exclusive forum.

This choice-of-forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with Fathom or its directors, officers, stockholders, agents or other employees, which may discourage such lawsuits. Alternatively, if a court were to find this provision of the Proposed Charter inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings,

 

71


Table of Contents

Fathom may incur additional costs associated with resolving such matters in other jurisdictions, which could materially and adversely affect Fathom’s business, financial condition and results of operations and result in a diversion of the time and resources of Fathom’s management and board of directors.

The Proposed Charter will not limit the ability of the CORE Investors to compete with us.

The CORE Investors and their affiliates engage in a broad spectrum of activities, including investments in the financial services and technology industries. In the ordinary course of their business activities, the CORE Investors and their affiliates may engage in activities where their interests conflict with Fathom’s interests or those of its stockholders. The Proposed Charter will provide that none of the CORE Investors, any of their affiliates or any director who is not employed by Fathom (including any non-employee director who serves as one of its officers in both his director and officer capacities) or its affiliates will have any duty to refrain from engaging, directly or indirectly, in the same business activities or similar business activities or lines of business in which Fathom operates. The CORE Investors and their affiliates also may pursue, in their capacities other than as directors of Fathom, acquisition opportunities that may be complementary to Fathom’s business, and, as a result, those acquisition opportunities may not be available to Fathom. In addition, the CORE Investors may have an interest in pursuing acquisitions, divestitures and other transactions that, in their judgment, could enhance their investment, even though such transactions might involve risks to you.

Risks Related to the Business Combination and Altimar II

Our Sponsor has agreed to vote in favor of the Business Combination, regardless of how our Public Shareholders vote.

Unlike some other blank check companies in which the initial shareholders agree to vote their shares in accordance with the majority of the votes cast by the public shareholders in connection with an initial business combination, Sponsor has agreed, among other things, (i) from the date of the Business Combination Agreement until the earlier of the Closing or the termination of the Business Combination Agreement in accordance with its terms, to not redeem any Class A ordinary shares (or, if applicable, shares of Altimar II Class A common stock) held by it and (ii) prior to the consummation of Business Combination or the termination of the Business Combination Agreement, to vote or cause to be voted, all of the Altimar II shares beneficially owned by Sponsor, at every meeting of the shareholders of Altimar II at which such matters are considered and at every adjournment or postponement thereof: (1) in favor of (A) the Business Combination and the Business Combination Agreement and the other transactions contemplated thereby (including any proposals recommended by Altimar II’s Board of Directors in connection with the Business Combination) and (B) any proposal to adjourn or postpone such meeting of shareholders to a later date if there are not sufficient votes to approve the Business Combination; (2) against any action, proposal, transaction or agreement that could reasonably be expected to result in a breach of any covenant, representation or warranty or any other obligation or agreement of Altimar II under the Business Combination Agreement; and (3) against (A) any proposal or offer from any person concerning (I) a merger, consolidation, liquidation, recapitalization, share exchange or other business combination transaction involving Altimar II, or (II) the issuance or acquisition of shares of capital stock or other Altimar II equity securities (other than as contemplated or permitted by the Business Combination Agreement); and (B) any action, proposal, transaction or agreement that would reasonably be expected to (x) impede the fulfillment of Altimar II’s conditions under the Business Combination Agreement or change in any manner the voting rights of any class of Altimar II’s shares or (y) result in a breach of any covenant, representation or warranty or other obligation or agreement of Sponsor contained in the Forfeiture and Support Agreement.

As of the date of this proxy statement/prospectus, the Sponsor owns approximately 20% of the issued and outstanding ordinary shares.

 

72


Table of Contents

If the conditions to the Business Combination Agreement are not met, the Business Combination may not occur.

Even if the Business Combination Agreement is approved by the shareholders of Altimar II, specified conditions must be satisfied or waived before the parties to the Business Combination Agreement are obligated to complete the Business Combination, including, among other things, certain approvals. For a list of the material closing conditions contained in the Business Combination Agreement, see the section entitled “The Business Combination Agreement — Conditions to Closing of the Business Combination Agreement.” Altimar II and Fathom may not satisfy all of the closing conditions in the Business Combination Agreement. If the closing conditions are not satisfied or waived, the Business Combination will not occur, or will be delayed pending later satisfaction or waiver, and such delay may cause Altimar II and Fathom OpCo to each lose some or all of the intended benefits of the Business Combination.

Some of Altimar II’s officers and directors may have conflicts of interest that may influence or have influenced them to support or approve the Business Combination without regard to your interests or in determining whether Fathom is appropriate for Altimar II’s initial business combination.

The personal and financial interests of Altimar II’s Sponsor, officers and directors may influence or have influenced their motivation in identifying and selecting a target for the Business Combination, their support for completing the Business Combination and the operation of Fathom following the Business Combination.

Altimar II’s Sponsor and independent directors own 8,450,000 and 175,000 Class B ordinary shares, respectively, which were initially acquired prior to Altimar II’s IPO for an aggregate purchase price of $0.003 per share and Altimar II’s officers have pecuniary interests in such ordinary shares through indirect ownership interests in the Sponsor. Such shares had an aggregate market value of approximately $                based on the last sale price of $                per share on the NYSE on        , the record date. In addition, the Sponsor purchased an aggregate of 9,900,000 Private Placement Warrants, each exercisable for one ordinary share of Altimar II at $11.50 per share, for a purchase price of $9,900,000, or $1.00 per warrant. Altimar II’s Amended and Restated Memorandum and Articles of Association require Altimar II to complete an initial business combination (which will be the Business Combination should it occur) within 24 months from the closing of the IPO, or February 9, 2023 (the “Combination Period”) (unless Altimar II submits and its shareholders approve an extension of such date). If the Business Combination is not completed and Altimar II is forced to wind up, dissolve and liquidate in accordance with the Amended and Restated Memorandum and Articles of Association, the 8,450,000 and 175,000 Class B ordinary shares currently held by Altimar II’s Sponsor and independent directors, respectively, and the Private Placement Warrants held by the Sponsor will be worthless (as the holders have waived liquidation rights with respect to such ordinary shares).

Altimar II’s Sponsor, directors and officers, and their respective affiliates have incurred significant out-of-pocket expenses in connection with performing due diligence on suitable targets for business combinations and the negotiation of the Business Combination. At the Closing of the Business Combination, Altimar II’s Sponsor, directors and officers, and their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on Altimar II’s behalf such as identifying potential target businesses and performing due diligence on suitable targets for business combinations. If an initial business combination is not completed prior to February 9, 2023, Altimar II’s Sponsor, directors and officers, or any of their respective affiliates will not be eligible for any such reimbursement.

Pre-existing relationships between participants in the Business Combination and the related transactions or their affiliates could give rise to actual or perceived conflicts of interest in connection with the Business Combination.

Certain of the participants in the Business Combination and the PIPE financing or their affiliates have pre-existing relationships that could give rise to actual or perceived conflicts of interest in connection with the Business Combination and related transactions. For example, certain of the PIPE investors are associated with entities affiliated with Sponsor. See “Certain Relationships and Related Party Transactions.”

 

73


Table of Contents

The exercise of Altimar II’s directors’ and executive officers’ discretion in agreeing to changes or waivers in the terms of the Business Combination may result in a conflict of interest when determining whether changes to the terms of the Business Combination or waivers of conditions are appropriate and in Altimar II’s shareholders’ best interest.

In the period leading up to the closing of the Business Combination, events may occur that, pursuant to the Business Combination Agreement, may require Altimar II to agree to amend the Business Combination Agreement, to consent to certain actions taken by Fathom OpCo or to waive rights that Altimar II is entitled to under the Business Combination Agreement. Such events could arise because of changes in the course of Fathom OpCo’s business, a request by Fathom OpCo to undertake actions that would otherwise be prohibited by the terms of the Business Combination Agreement or the occurrence of other events that would have a material adverse effect on Fathom OpCo’s business and would entitle Altimar II to terminate the Business Combination Agreement. In any of such circumstances, it would be at Altimar II’s discretion, acting through its board of directors, to grant its consent or waive those rights. The existence of financial and personal interests of one or more of the directors described in the preceding risk factors may result in a conflict of interest on the part of such director(s) between what he or they may believe is best for Altimar II and its shareholders and what he or they may believe is best for himself or themselves in determining whether or not to take the requested action. As of the date of this proxy statement/prospectus, Altimar II does not believe there will be any changes or waivers that Altimar II’s directors and executive officers would be likely to make after shareholder approval of the Business Combination Proposal has been obtained. While certain changes could be made without further shareholder approval, Altimar II will circulate a new or amended proxy statement/prospectus and resolicit Altimar II’s shareholders if changes to the terms of the transaction that would have a material impact on its shareholders are required prior to the vote on the Business Combination Proposal.

A portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future. This could cause the market price of our Class A common stock to drop significantly, even if Fathom’s business is doing well.

Sales of a substantial number of shares of the Class A common stock in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of the Class A common stock. While the the Legacy Fathom Owners and the Altimar II Founders have agreed, and will continue to be subject, to certain restrictions regarding the transfer of the Class A common stock, these shares may be sold after the expiration of the applicable restrictions. Fathom may file one or more registration statements prior to or shortly after the closing of the Business Combination to provide for the resale of such shares from time to time. As restrictions on resale end and the registration statements are available for use, the market price of the Class A common stock could decline if the holders of currently restricted shares sell them or are perceived by the market as intending to sell them.

If the sale of some or all of the PIPE Investment fails to close and sufficient shareholders exercise their Redemption Rights in connection with the Business Combination, Altimar II may lack sufficient funds to consummate the Business Combination.

In connection with the signing of the Business Combination Agreement, Altimar II and Fathom OpCo entered into Subscription Agreements with the PIPE Investors which provide for the purchase of an aggregate of 8,000,000 shares of Class A common stock (the “PIPE Securities”) following the Domestication and immediately prior to the Closing in a private placement to close concurrently with, and contingent upon, the closing of the Business Combination, for a purchase price of $10.00 per share, or an aggregate of $80.0 million. These purchases will be made regardless of whether any Class A ordinary shares are redeemed by Altimar II’s Public Shareholders. The proceeds from the sale of PIPE Securities will be part of the Business Combination consideration. In addition, prior to giving effect to the exercise of any Redemption Rights, the Trust Account has approximately $345,000,000, plus accrued interest since the completion of the Altimar II IPO. However, if the sale of the PIPE Securities does not close by reason of the failure by some or all of the PIPE Investors to fund the

 

74


Table of Contents

purchase price for their PIPE Securities, for example, and a sufficient number of holders of Class A ordinary shares exercise their redemption tights in connection with the Business Combination, we may lack sufficient funds to consummate the Business Combination. Additionally, the PIPE Investors’ obligations to purchase the PIPE Securities are subject to termination prior to the closing of the sale of the PIPE Securities by mutual written consent of Altimar II, Fathom OpCo and each of the PIPE Investors, or if the Business Combination is not consummated on or before December 31, 2021. The PIPE Investors’ obligations to purchase the PIPE Securities are subject to fulfillment of customary closing conditions, including that the Business Combination must be consummated substantially concurrently with, and immediately following, the purchase of PIPE Securities. In the event of any such failure to fund, any obligation is so terminated or any such condition is not satisfied and not waived, we may not be able to obtain additional funds to account for such shortfall on terms favorable to us or at all. Any such shortfall would also reduce the amount of funds that we have available for working capital of the post-business combination Company. While the PIPE Investors represented to us that they have sufficient funds to satisfy their obligations under the respective Subscription Agreements, we have not obligated them to reserve funds for such obligations. The Business Combination Agreement includes a minimum condition to Fathom OpCo’s obligation to consummate the Business Combination that at least $313.0 million in cash is available to Altimar II from the PIPE Investment together with any cash remaining in the Trust Account after giving effect to any exercise of Redemption Rights by Altimar II’s shareholders.

For information on the consequences if the Business Combination is not completed or must be restructured, please see the section of this proxy statement/prospectus entitled “Risk Factors — Risks Related to the Business Combination and Altimar II.”

Subsequent to the completion of the Business Combination, Fathom may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on its financial condition and its share price, which could cause you to lose some or all of your investment.

Altimar II cannot assure you that the due diligence Altimar II has conducted on Fathom will reveal all material issues that may be present with regard to Fathom, or that factors outside of Altimar II’s or Fathom’s control will not later arise. As a result of unidentified issues or factors outside of Altimar II’s or Fathom’s control, Fathom may be forced to later write-down or write-off assets, restructure operations, or incur impairment or other charges that could result in reporting losses. Even if Altimar II’s due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with the preliminary risk analysis conducted by Altimar II. Even though these charges may be non-cash items that would not have an immediate impact on Fathom’s liquidity, the fact that Fathom reports charges of this nature could contribute to negative market perceptions about Fathom or its securities. In addition, charges of this nature may cause Fathom to violate leverage or other covenants to which it may be subject. Accordingly, any shareholders who choose to remain shareholders following the Business Combination could suffer a reduction in the value of their shares from any such write-down or write-downs.

Altimar II’s shareholders will experience dilution due to the issuance to Legacy Fathom Owners of securities entitling them to a significant voting stake in Fathom.

Based upon the assumptions described under the section entitled “Unaudited Pro Forma Combined Financial Information,” Altimar II’s current Public Shareholders would hold in the aggregate approximately 25% of the outstanding economic interests in Fathom, and the PIPE Investors would hold approximately 5.8% of the outstanding shares of the Class A common stock (in each case, assuming no redemptions by Altimar II’s Public Shareholders), following the consummation of the Business Combination. Assuming maximum redemptions by Altimar II’s Public Shareholders and subject to the other assumptions described under the section entitled “Unaudited Pro Forma Combined Financial Information”, Altimar II’s non-redeeming Public Shareholders would hold in the aggregate approximately 17.0% of the outstanding economic interests in Fathom and the PIPE Investors would hold approximately 5.8% of the outstanding shares of Class A common stock following the consummation of the Business Combination. Without limiting the other assumptions described under the section

 

75


Table of Contents

entitled “Unaudited Pro Forma Combined Financial Information,” these ownership percentages do not take into account:

 

   

any warrants or options to purchase the Class A common stock that will be outstanding following the Business Combination;

 

   

any equity awards that may be issued by Fathom; and

 

   

the Earnout Shares or the Sponsor Earnout Shares.

If any shares of Class A common stock are redeemed in connection with the Business Combination, the percentage of Fathom’s outstanding voting stock held by the current holders of Altimar II will decrease relative to the percentage held if none of the Class A ordinary shares are redeemed. To the extent that any of the outstanding warrants are exercised for shares of Class A common stock, Altimar II’s existing shareholders may experience substantial dilution.

Altimar II has not obtained an opinion from an independent investment banking firm or another independent firm, and consequently, you may have no assurance from an independent source that the terms of the Business Combination are fair to Altimar II from a financial point of view.

The Altimar II Board did not obtain a third-party valuation or fairness opinion in connection with their determination to approve the Business Combination. Altimar II is not required to obtain an opinion from an independent investment banking firm that is a member of FINRA or from another independent firm that the price it is paying is fair to Altimar II from a financial point of view. In analyzing the Business Combination, the Altimar II Board and Altimar II’s management conducted due diligence on Fathom OpCo and researched the industry in which Fathom OpCo operates and concluded that the Business Combination was in the best interest of its shareholders. Accordingly, Altimar II’s shareholders will be relying solely on the judgment of the Altimar II Board in determining the value of the Business Combination, and the Altimar II Board may not have properly valued such business. The lack of a third-party valuation or fairness opinion may also lead an increased number of shareholders to vote against the Business Combination or demand redemption of their shares, which could potentially impact our ability to consummate the Business Combination. For more information about our decision-making process, see the section entitled “The Business Combination Agreement — Altimar II’s Board of Director’s Reasons for the Approval of the Business Combination.”

If the Adjournment Proposal is not approved, and an insufficient number of votes have been obtained to authorize the consummation of the Business Combination and the Domestication, the Altimar II board of directors will not have the ability to adjourn the Special Meeting to a later date in order to solicit further votes, and, therefore, the Business Combination will not be approved, and, therefore, the Business Combination may not be consummated.

The Altimar II Board is seeking approval to adjourn the Special Meeting to a later date or dates if, at the Special Meeting, based upon the tabulated votes, there are insufficient votes to approve each of the Condition Precedent Proposals. If the Adjournment Proposal is not approved, the Altimar II Board will not have the ability to adjourn the Special Meeting to a later date and, therefore, will not have more time to solicit votes to approve the Condition Precedent Proposals. In such event, the Business Combination would not be completed.

The unaudited pro forma financial information included in the section entitled “Unaudited Pro Forma Combined Financial Information” may not be representative of Fathom’s results if the Business Combination is completed.

Altimar II and Fathom OpCo currently operate as separate companies and have had no prior history as a combined entity. The pro forma financial information included in this proxy statement/prospectus is presented for informational purposes only and is not necessarily indicative of the financial position or results of operations

 

76


Table of Contents

that would have actually occurred had the Business Combination been completed at or as of the dates indicated, nor is it indicative of the future operating results or financial position of Fathom OpCo. The pro forma statement of operations does not reflect future nonrecurring charges resulting from the Business Combination. The unaudited pro forma financial information does not reflect future events that may occur after the Business Combination and does not consider potential impacts of future market conditions on revenues or expenses. The pro forma financial information included in the section entitled “Unaudited Pro Forma Combined Financial Information” has been derived from Altimar II’s and Fathom OpCo’s historical financial statements and certain adjustments and assumptions have been made regarding Fathom after giving effect to the Business Combination. There may be differences between preliminary estimates in the pro forma financial information and the final acquisition accounting, which could result in material differences from the pro forma information presented in this proxy statement/prospectus in respect of the estimated financial position and results of operations of Fathom.

In addition, the assumptions used in preparing the pro forma financial information may not prove to be accurate and other factors may affect Fathom’s financial condition or results of operations following the Closing. Any potential decline in Fathom’s financial condition or results of operations may cause significant variations in the stock price of Fathom.

During the pendency of the Business Combination, Altimar II will not be able to solicit, initiate or take any action to facilitate or encourage any inquiries or the making, submission or announcement of, or enter into a business combination with another party because of restrictions in the Business Combination Agreement.

During the pendency of the Business Combination, Altimar II will not be able to enter into a business combination with another party because of non-solicitation provisions in the Business Combination Agreement which prohibit Altimar II from soliciting other business combinations. If the Business Combination is not completed, these non-solicitation provisions will make it more difficult to complete an alternative business combination following the termination of the Business Combination Agreement due to the passage of time during which these provisions have remained in effect.

Because Altimar II is incorporated under the laws of the Cayman Islands, in the event the Business Combination is not completed, you may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. Federal courts may be limited.

Because Altimar II is currently incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests and your ability to protect your rights through the U.S. Federal courts may be limited prior to the Domestication. Altimar II is currently an exempted company under the laws of the Cayman Islands. As a result, it may be difficult for investors to effect service of process within the United States upon Altimar II’s directors or officers, or enforce judgments obtained in the United States courts against Altimar II’s directors or officers.

Until the Domestication is effected, Altimar II’s corporate affairs are governed by the Amended and Restated Memorandum and Articles of Association, the Cayman Islands Companies Act and the common law of the Cayman Islands. The rights of shareholders to take action against the directors, actions by minority shareholders and the fiduciary responsibilities of its directors to Altimar II under the laws of the Cayman Islands are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from English common law, the decisions of whose courts are of persuasive authority, but are not binding on a court in the Cayman Islands. The rights of Altimar II’s shareholders and the fiduciary responsibilities of its directors under Cayman Islands law are different from what they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law. In addition, Cayman Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States.

 

77


Table of Contents

The courts of the Cayman Islands are unlikely (i) to recognize or enforce against Altimar II judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against Altimar II predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money judgment of a foreign court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a competent foreign court imposes upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain conditions are met. For a foreign judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a liquidated sum, and must not be in respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the same matter, impeachable on the grounds of fraud or obtained in a manner, or be of a kind the enforcement of which is, contrary to natural justice or the public policy of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy). A Cayman Islands court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.

The Public Shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of the Altimar II Board or controlling shareholders than they would as public shareholders of a United States company.

Fathom will be a holding company and its only material asset after completion of the Business Combination will be its interest in Fathom OpCo, and it is accordingly dependent upon distributions made by Fathom OpCo to pay dividends, taxes, and other expenses, including payments under the Tax Receivable Agreement.

Upon completion of the Business Combination, Fathom will be a holding company with no material assets other than its New Fathom Units. As a result, Fathom will have no independent means of generating revenue or cash flow. Fathom’s ability to pay dividends, taxes, and other expenses, including payments under the Tax Receivable Agreement, will depend on the financial results and cash flows of Fathom OpCo and its subsidiaries and the distributions Fathom receives from Fathom OpCo. Deterioration in the financial condition, earnings or cash flow of Fathom OpCo and its subsidiaries for any reason could limit or impair Fathom OpCo’s ability to pay such distributions. Additionally, to the extent that Fathom needs funds and Fathom OpCo and/or its subsidiaries are restricted from making such distributions under applicable law or regulation or under the terms of any financing arrangements, or Fathom OpCo and/or its subsidiaries are otherwise unable to provide such funds, it could materially adversely affect Fathom’s liquidity and financial condition.

Subject to the discussion herein, Fathom OpCo will continue to be treated as a partnership for U.S. federal income tax purposes and, as such, generally will not be subject to any entity-level U.S. federal income tax. Instead, taxable income will be allocated to holders of New Fathom Units. Accordingly, Fathom will be required to pay income taxes on its allocable share of any net taxable income of Fathom OpCo. Under the terms of the Fathom Operating Agreement, Fathom OpCo is obligated to make tax distributions to holders of the New Fathom Units (including Fathom) calculated at certain assumed tax rates. In addition to tax expenses, Fathom will also incur expenses related to its operations, including Fathom’s payment obligations under the Tax Receivable Agreement, which could be significant, and some of which will be reimbursed by Fathom OpCo (excluding payment obligations under the Tax Receivable Agreement). Fathom intends to cause Fathom OpCo to make ordinary distributions and tax distributions to holders of New Fathom Units on a pro rata basis in amounts sufficient to cover all applicable taxes, relevant operating expenses, payments by Fathom under the Tax Receivable Agreement and dividends, if any, declared by Fathom. However, as discussed above, Fathom OpCo’s ability to make such distributions may be subject to various limitations and restrictions including, but not limited to, retention of amounts necessary to satisfy the obligations of Fathom OpCo and its subsidiaries and restrictions on distributions that would violate any applicable restrictions contained in Fathom OpCo’s or its subsidiaries’ debt agreements, or any applicable law, or that would have the effect of rendering Fathom OpCo or a subsidiary

 

78


Table of Contents

insolvent. To the extent that Fathom is unable to make payments under the Tax Receivable Agreement for any reason, such payments will be deferred and will accrue interest until paid; provided, however, that nonpayment for a specified period may constitute a breach of a material obligation under the Tax Receivable Agreement and therefore accelerate payments under the Tax Receivable Agreement, which could be substantial.

Additionally, although Fathom OpCo and its subsidiaries generally will not be subject to any entity-level U.S. federal income tax, they may be liable for audit adjustments to prior year tax returns, absent an election to the contrary. In the event Fathom OpCo’s calculations of taxable income are incorrect, Fathom OpCo, its subsidiaries and/or their respective owners, including Fathom, in later years may be subject to material liabilities as a result of such audits.

If Fathom OpCo were treated as a corporation for U.S. federal income tax or state tax purposes, then the amount available for distribution by Fathom OpCo could be substantially reduced and the value of Fathom common stock could be adversely affected.

An entity that would otherwise be classified as a partnership for U.S. federal income tax purposes (such as Fathom OpCo) may nonetheless be treated as, and taxable as, a corporation if it is a “publicly traded partnership” unless an exception to such treatment applies. An entity that would otherwise be classified as a partnership for U.S. federal income tax purposes will be treated as a “publicly traded partnership” if interests in such entity are traded on an established securities market or interests in such entity are readily tradable on a secondary market or the substantial equivalent thereof. If Fathom OpCo were determined to be treated as a “publicly traded partnership” (and taxable as a corporation) for U.S. federal income tax purposes, Fathom OpCo would be taxable on its income at the U.S. federal income tax rates applicable to corporations and distributions by Fathom OpCo to its partners (including Fathom) could be taxable as dividends to such partners to the extent of the earnings and profits of Fathom OpCo. In addition, Fathom would no longer have the benefit of increases in the tax basis of Fathom OpCo’s assets as a result of exchanges of New Fathom Units for shares of Fathom Class A common stock. Pursuant to the Fathom Operating Agreement, the Exchange TRA Parties (as defined in the Tax Receivable Agreement) may, from time to time, subject to the terms of the Fathom Operating Agreement, exchange their interests in Fathom OpCo and have such interests redeemed by Fathom OpCo for cash or Fathom stock. While such exchanges could be treated as trading in the interests of Fathom OpCo for purposes of testing “publicly traded partnership” status, the Fathom Operating Agreement requires Fathom to impose restrictions on exchanges that Fathom determines to be necessary or advisable so that Fathom OpCo is not treated as a “publicly traded partnership” for U.S. federal income tax purposes. Accordingly, while such position is not free from doubt, Fathom OpCo is expected to be operated such that it is not treated as a “publicly traded partnership” taxable as a corporation for U.S. federal income tax purposes and we intend to take the position that Fathom OpCo is not so treated as a result of exchanges of its interests pursuant to the Fathom Operating Agreement.

Pursuant to the Tax Receivable Agreement, Fathom will be required to make payments to Blocker TRA Parties and Exchange TRA Parties (each as defined in the Tax Receivable Agreement) for certain tax benefits Fathom may claim and those payments may be substantial.

The Exchange TRA Parties (as defined in the Tax Receivable Agreement) will sell or exchange certain interests in Fathom OpCo pursuant to the transactions contemplated by the Business Combination Agreement and may in the future exchange their New Fathom Units, together with the cancellation of an equal number of shares of Class B common stock, for shares of Fathom Class A common stock, or cash pursuant to the Fathom Operating Agreement. Such transactions are expected to result in increases in Fathom’s allocable share of the tax basis of the tangible and intangible assets of Fathom OpCo and its subsidiaries. These increases in tax basis may increase (for income tax purposes) depreciation and amortization deductions and therefore reduce the amount of income or franchise tax that Fathom would otherwise be required to pay in the future had such sales and exchanges never occurred. Additionally, in connection with the closing of the Business Combination Agreement, Fathom will acquire the Fathom Blockers from the Blocker TRA Parties (as defined in the Tax Receivable Agreement). Certain tax assets and attributes of the Fathom Blockers may be available to reduce the amount of

 

79


Table of Contents

income or franchise tax that Fathom would otherwise be required to pay in the future had it not acquired the Fathom Blockers.

In connection with the Business Combination, Fathom will enter into the Tax Receivable Agreement, which generally provides for the payment by it of 85% of certain tax benefits, if any, that it realizes (or in certain cases is deemed to realize) as a result of tax basis in certain assets and other tax attributes of the Fathom Blockers and of Fathom at the time of the Business Combination (including as a result of any cash payments made to Fathom OpCo in exchange for New Fathom Units pursuant to the Business Combination), any increases in tax basis and other tax benefits related to the payment of cash consideration pursuant to the Business Combination Agreement and any increases in tax basis and other tax benefits resulting from any exchange of New Fathom Units for shares of Class A common stock or cash in the future and tax benefits related to entering into and making payments under the Tax Receivable Agreement. Those payments are the obligation of Fathom and not of Fathom OpCo. The actual increase in Fathom’s allocable share of Fathom OpCo’s tax basis in its assets, as well as the amount and timing of any payments under the Tax Receivable Agreement, will vary depending upon a number of factors, including the timing of exchanges, the market price of the Class A common stock at the time of the exchange, the extent to which such exchanges are taxable and the amount and timing of the recognition of Fathom’s income. While many of the factors that will determine the amount of payments that Fathom will make under the Tax Receivable Agreement are outside of its control, Fathom expects that the payments it will make under the Tax Receivable Agreement will be substantial and could have a material adverse effect on Fathom’s financial condition. Any payments made by Fathom under the Tax Receivable Agreement will generally reduce the amount of overall cash flow that might have otherwise been available to Fathom. To the extent that Fathom is unable to make timely payments under the Tax Receivable Agreement for any reason, the unpaid amounts will be deferred and will accrue interest until paid; however, nonpayment for a specified period may constitute a breach of a material obligation under the Tax Receivable Agreement and therefore accelerate payments due under the Tax Receivable Agreement, as further described below. Furthermore, Fathom’s future obligation to make payments under the Tax Receivable Agreement could make Fathom a less attractive target for an acquisition, particularly in the case of an acquirer that cannot use some or all of the tax benefits that may be realized or deemed realized under the Tax Receivable Agreement. See the section entitled “The Business Combination Agreement — Related Agreements — Tax Receivable Agreement.”

In certain cases, payments under the Tax Receivable Agreement may exceed the actual tax benefits Fathom realizes or be accelerated.

Payments under the Tax Receivable Agreement will be based on the tax reporting positions that Fathom determines under the procedures and assumptions set forth in the Tax Receivable Agreement, and the IRS or another taxing authority may challenge all or any part of the tax basis increases, as well as other tax positions that Fathom takes, and a court may sustain such a challenge. In the event that any tax benefits initially claimed by Fathom are disallowed, the Exchange TRA Parties and the Blocker TRA Parties (each as defined in the Tax Receivable Agreement) will not be required to reimburse Fathom for any excess payments that may previously have been made under the Tax Receivable Agreement, for example, due to adjustments resulting from examinations by taxing authorities. Rather, excess payments made to such holders will be netted against any future cash payments otherwise required to be made by Fathom under the Tax Receivable Agreement, if any, after the determination of such excess. However, a challenge to any tax benefits initially claimed by Fathom may not arise for a number of years following the initial time of such payment or, even if challenged early, such excess cash payment may be greater than the amount of future cash payments that Fathom might otherwise be required to make under the terms of the Tax Receivable Agreement and, as a result, there might not be future cash payments against which to net. Actual tax benefits realized by Fathom may differ from tax benefits calculated under the Tax Receivable Agreement as a result of the use of certain assumptions in the Tax Receivable Agreement, including the use of an assumed weighted-average state and local income tax rate to calculate tax benefits. As a result, in certain circumstances Fathom could make payments under the Tax Receivable Agreement in excess of Fathom’s actual income or franchise tax savings, which could materially impair Fathom’s financial condition.

 

80


Table of Contents

Moreover, the Tax Receivable Agreement provides that, in certain events, including a change of control, breach of a material obligation under the Tax Receivable Agreement, or Fathom’s exercise of early termination rights, Fathom’s obligations under the Tax Receivable Agreement will accelerate and Fathom will be required to make a lump-sum cash payment to the Exchange TRA Parties and the Blocker TRA Parties (each as defined in the Tax Receivable Agreement) and other applicable parties to the Tax Receivable Agreement equal to the present value of all forecasted future payments that would have otherwise been made under the Tax Receivable Agreement, which lump-sum payment would be based on certain assumptions, including those relating to Fathom’s future taxable income. The lump-sum payment could be substantial and could exceed the actual tax benefits that Fathom realizes subsequent to such payment because such payment would be calculated assuming, among other things, that Fathom would have certain tax benefits available to it and that Fathom would be able to use the potential tax benefits in future years.

There may be a material negative effect on Fathom’s liquidity if the payments required to be made by Fathom under the Tax Receivable Agreement exceed the actual income or franchise tax savings that Fathom realizes. Furthermore, Fathom’s obligations to make payments under the Tax Receivable Agreement could also have the effect of delaying, deferring or preventing certain mergers, asset sales, other forms of business combinations or other changes of control.

Fathom OpCo may directly or indirectly make distributions of cash to us substantially in excess of the amounts we use to make distributions to our stockholders and pay our expenses (including our taxes and payments by Fathom under the Tax Receivable Agreement). To the extent we do not distribute such excess cash as dividends to our shareholders, the direct or indirect holders of New Fathom Units would benefit from any value attributable to such cash as a result of their ownership of our stock upon an exchange of their New Fathom Units.

Following the Business Combination, we will receive a pro rata portion of any distributions made by Fathom OpCo. Any cash received from such distributions will first be used to satisfy any tax liability and then to make any payments required to be made by Fathom under the Tax Receivable Agreement. Subject to having available cash and subject to limitations imposed by applicable law and contractual restrictions, the Fathom Operating Agreement requires Fathom OpCo to make certain distributions to holders of New Fathom Units (including Fathom) pro rata to facilitate the payment of taxes with respect to the income of Fathom OpCo that is allocated to them. To the extent that the tax distributions we directly or indirectly receive exceed the amounts we actually require to pay taxes, Tax Receivable Agreement payments and other expenses (which is likely to be the case given that the assumed tax rate for such distributions will generally exceed our effective tax rate), we will not be required to distribute such excess cash. Our board of directors may, in its sole discretion, choose to use such excess cash for certain purposes, including to make distributions to the holders of our stock. Unless and until our board of directors chooses, in its sole discretion, to declare a distribution, we will have no obligation to distribute such cash (or other available cash other than any declared dividend) to our stockholders.

No adjustments to the exchange ratio of New Fathom Units for shares of our common stock will be made as a result of either (i) any cash distribution by us or (ii) any cash that we retain and do not distribute to our stockholders. To the extent we do not distribute such cash as dividends and instead, for example, hold such cash balances or use such cash for certain other purposes, this may result in shares of our stock increasing in value relative to the New Fathom Units. The holders of New Fathom Units may benefit from any value attributable to such cash balances if they acquire shares of our stock in an exchange of New Fathom Units.

The Domestication may result in adverse tax consequences for holders of Altimar II ordinary shares and warrants, including Public Shareholders exercising Redemption Rights.

U.S. holders (as defined in “Material U.S. Federal Income Tax Considerations — U.S. Holders” below) may be subject to U.S. federal income tax as a result of the Domestication. It is intended that the Domestication qualify as a reorganization within the meaning of Section 368(a)(1)(F) of the Code for U.S. federal income tax purposes.

 

81


Table of Contents

However, due to the absence of direct guidance on the application of Section 368(a)(1)(F) to a statutory conversion of a corporation holding only investment-type assets such as Altimar II, this result is not entirely clear.

Assuming the Domestication qualifies as a reorganization under Section 368(a)(1)(F) of the Code, U.S. holders of Altimar II ordinary shares will be subject to Section 367(b) of the Code, and as a result:

 

   

a U.S. holder of Altimar II ordinary shares whose Altimar II ordinary shares have a fair market value of less than $50,000 on the date of the Domestication should not recognize any gain or loss and generally should not be required to include any part of Altimar II’s earnings in income pursuant to the Domestication;

 

   

a U.S. holder of Altimar II ordinary shares whose Altimar II ordinary shares have a fair market value of $50,000 or more on the date of the Domestication, but who on the date of the Domestication owns (actually and constructively) less than 10% of the total combined voting power of all classes of Altimar II ordinary shares entitled to vote and less than 10% of the total value of all classes of Altimar II ordinary shares will generally recognize gain (but not loss) with respect to the Domestication, as if such U.S. holder exchanged its Altimar II ordinary shares for Fathom common stock in a taxable transaction. As an alternative to recognizing gain, such U.S. holders may file an election to include in income as a dividend the “all earnings and profits amount” (as defined in Treasury Regulation Section 1.367(b)-2(d)) attributable to their Altimar II ordinary shares, provided certain other requirements are satisfied. Altimar II does not expect that Altimar II’s cumulative earnings and profits will be material at the time of Domestication; and

 

   

a U.S. holder of Altimar II ordinary shares who on the date of the Domestication owns (actually and constructively) 10% or more of the total combined voting power of all classes of Altimar II ordinary shares entitled to vote or 10% or more of the total value of all classes of Altimar II ordinary shares will generally be required to include in income as a dividend the “all earnings and profits amount” (as defined in Treasury Regulation Section 1.367(b)-2(d)) attributable to its Altimar II ordinary shares. Any such U.S. holder that is a corporation may, under certain circumstances, effectively be exempt from taxation on a portion or all of the deemed dividend pursuant to Section 245A of the Code. Altimar II does not expect that Altimar II’s cumulative earnings and profits will be material at the time of the Domestication.

If Altimar II were to be treated as a PFIC, for U.S. federal income tax purposes, certain U.S. Holders may be subject to adverse tax consequences as a result of the Domestication. Pursuant to a start-up exception, a corporation will not be a PFIC for the first taxable year the corporation has gross income (the “start-up year”), if (i) no predecessor of the corporation was a PFIC; (ii) the corporation satisfies the IRS that it will not be a PFIC for either of the first two taxable years following the start-up year; and (iii) the corporation is not in fact a PFIC for either of those two years. Altimar II believes, although subject to uncertainty, that Altimar II’s 2021 taxable year may be the start-up year and that Altimar II may not be treated as a PFIC for 2021. The application of the start-up exception will depend, in part, on whether the Domestication is consummated in 2021. In addition, the application of the start-up exception to the present transaction involves the application of complicated rules with respect to which there is no clear authority. Accordingly, there can be no assurance with respect to Altimar II’s status as a PFIC for 2021. All holders are urged to consult their tax advisors concerning the application of the PFIC rules to Altimar II under such holder’s particular circumstances, including the potential to make a “qualified electing fund” election or a protective “qualified electing fund” election. For a more complete discussion of the requirements to qualify for the start-up exception and the potential application of the PFIC rules to U.S. holders as a result of the Domestication, see “Material U.S. Federal Income Tax Considerations — U.S. Holders — PFIC Considerations.”

Additionally, the Domestication may cause non-U.S. holders (as defined in “Material U.S. Federal Income Tax Considerations — Non-U.S. Holders” below) to become subject to U.S. federal withholding taxes on any dividends paid in respect of such non-U.S. holder’s Fathom common stock after the Domestication.

 

82


Table of Contents

Furthermore, because the Domestication will occur immediately prior to the redemption of U.S. holders that exercise Redemption Rights, U.S. holders exercising Redemption Rights will be subject to the potential tax consequences of the Domestication.

The tax consequences of the Domestication are complex and will depend on a holder’s particular circumstances. All holders are strongly urged to consult their tax advisors for a full description and understanding of the tax consequences of the Domestication, including the applicability and effect of U.S. federal, state, local and foreign income and other tax laws. For a more complete discussion of the U.S. federal income tax consequences of the Domestication, see the discussion in the section entitled “Material U.S. Federal Income Tax Considerations.

Fathom’s business and operations could be negatively affected if it becomes subject to any securities litigation or shareholder activism, which could cause Fathom to incur significant expense, hinder execution of business and growth strategy and impact its stock price.

In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been brought against that company. Shareholder activism, which could take many forms or arise in a variety of situations, has been increasing recently. Volatility in the stock price of Fathom’s Class A common stock or other reasons may in the future cause it to become the target of securities litigation or shareholder activism. Securities litigation and shareholder activism, including potential proxy contests, could result in substantial costs and divert management’s and the board of directors’ attention and resources from Fathom’s business. Additionally, such securities litigation and shareholder activism could give rise to perceived uncertainties as to Fathom’s future, adversely affect its relationships with service providers and make it more difficult to attract and retain qualified personnel. Also, Fathom may be required to incur significant legal fees and other expenses related to any securities litigation and activist shareholder matters. Further, its stock price could be subject to significant fluctuation or otherwise be adversely affected by the events, risks and uncertainties of any securities litigation and shareholder activism.

In connection with the Business Combination, the Sponsor, the other Altimar II Founder, directors, executive officers, advisors and their affiliates may elect to purchase shares or Public Warrants from Public Shareholders, which may influence a vote on a proposed business combination and reduce the public “float” of our Class A ordinary shares.

In connection with the Business Combination, the Sponsor, the other Altimar II Founders, directors, executive officers, advisors or their affiliates may purchase shares or Public Warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination, although they are under no obligation to do so. However, other than as expressly stated herein, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the Trust Account will be used to purchase shares or Public Warrants in such transactions.

In the event that the Sponsor, the other Altimar II Founders, directors, executive officers, advisors or their affiliates purchase shares in privately negotiated transactions from public shareholders who have already elected to exercise their Redemption Rights, such selling shareholders would be required to revoke their prior elections to redeem their shares. The purpose of any such purchases of shares would be to vote such shares in favor of the Business Combination and thereby increase the likelihood of obtaining shareholder approval of the Business Combination or to satisfy the Available Cash Amount Condition, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of Public Warrants would be to reduce the number of Public Warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.

 

83


Table of Contents

In addition, if such purchases are made, the public “float” of our Class A ordinary shares or Public Warrants and the number of beneficial holders of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange.

There is no guarantee that a shareholder’s decision whether to redeem its shares for a pro rata portion of the Trust Account will put the shareholder in a better future economic position.

We can give no assurance as to the price at which a shareholder may be able to sell its Class A common stock in the future following the completion of the Business Combination or any alternative business combination. Certain events following the consummation of any initial business combination, including the Business Combination, may cause an increase in our share price, and may result in a lower value realized now than a shareholder might realize in the future had the shareholder not redeemed its shares. Similarly, if a shareholder does not redeem its shares, the shareholder will bear the risk of ownership of the Class A common stock after the consummation of the Business Combination, and there can be no assurance that a shareholder can sell its shares in the future for a greater amount than the redemption price set forth in this proxy statement/prospectus. A shareholder should consult the shareholder’s own financial advisor for assistance on how this may affect his, her or its individual situation.

If a shareholder fails to receive notice of our offer to redeem our Class A ordinary shares in connection with the Business Combination, such shares may not be redeemed.

We will comply with the proxy rules when conducting redemptions in connection with the Business Combination. Despite our compliance with these rules, if a shareholder fails to receive our proxy solicitation, such shareholder may not become aware of the opportunity to redeem its shares. In addition, the proxy solicitation that we furnish to holders of our Class A ordinary shares in connection with the Business Combination describes the various procedures that must be complied with in order to validly redeem or tender Class A ordinary shares. In the event that a shareholder fails to comply with these procedures, its shares may not be redeemed.

If you or a “group” of shareholders are deemed to hold in excess of 15% of our Class A ordinary shares, you will lose the ability to redeem all such shares in excess of 15% of our Class A ordinary shares.

The Amended and Restated Memorandum and Articles of Association of Altimar II provide that a Public Shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from seeking Redemption Rights with respect to more than an aggregate of 15% of the shares sold in the IPO without our prior consent, which we refer to as the “Excess Shares.” However, we would not be restricting our shareholders’ ability to vote all of their shares (including Excess Shares) for or against the Business Combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete the Business Combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete the Business Combination. As a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required to sell your shares in open market transactions, potentially at a loss.

If third parties bring claims against us, the proceeds held in the Trust Account could be reduced and the per-share redemption amount received by shareholders may be less than $10.00 per share.

Our placing of funds in the Trust Account may not protect those funds from third party claims against us. Since the consummation of the IPO, we have sought and will continue to seek to have vendors, service providers, prospective target businesses, including the Continuing Fathom Unitholders in the Business Combination, and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of

 

84


Table of Contents

any kind in or to any monies held in the Trust Account for the benefit of our Public Shareholders. However, in certain instances we have not been able to obtain such a waiver in agreements that we have executed. Further, under certain circumstances, parties that have executed such a waiver may not be prevented from bringing claims against the Trust Account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case, in order to gain advantage with respect to a claim against our assets, including the funds held in the Trust Account. In determining whether to enter into an agreement with a third party that refuses to execute a waiver of such claims to the monies held in the Trust Account, our management has and will consider whether competitive alternatives are reasonably available to us, and have historically only entered into agreements with third parties without such a waiver in situations where management believes that such third party’s engagement is in the best interests of Altimar II under the circumstances.

Upon redemption of our Class A ordinary shares, if we are unable to complete the initial business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection with the initial business combination, we may be required to provide for payment of claims of creditors that were not waived that may be brought against us within the ten years following redemption. Although no such claims have been brought against us or threatened to date, the per-share redemption amount received by Public Shareholders could be less than the $10.00 per Public Share initially held in the Trust Account, due to claims of such creditors to the extent they are brought in the future. Pursuant to a letter agreement, the Sponsor agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we entered into a written letter of intent, confidentiality or other similar agreement or business combination agreement reduces the amount of funds in the Trust Account to below the lesser of (i) $10.00 per Public Share and (ii) the actual amount per share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.00 per share due to reductions in the value of the trust assets, in each case less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the Trust Account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act. However, we have not asked the Sponsor to reserve for such indemnification obligations, nor have we independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations and we believe that the Sponsor’s only assets are securities of our company. Therefore, we cannot assure you that the Sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.

Our directors may decide not to enforce the indemnification obligations of the Sponsor, resulting in a reduction in the amount of funds in the Trust Account available for distribution to our Public Shareholders.

In the event that the proceeds in the Trust Account are reduced below the lesser of (i) $10.00 per share and (ii) the actual amount per share held in the Trust Account as of the date of the liquidation of the Trust Account if less than $10.00 per share due to reductions in the value of the trust assets, in each case less taxes payable, and the Sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against the Sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against the Sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment and subject to their fiduciary duties may choose not to do so in any particular instance. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the Trust Account available for distribution to our Public Shareholders may be reduced below $10.00 per share.

We may not have sufficient funds to satisfy indemnification claims of our directors and executive officers.

We agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors agreed to waive any right, title, interest or claim of any kind in or to any monies in the

 

85


Table of Contents

Trust Account and to not seek recourse against the Trust Account for any reason whatsoever (except to the extent they are entitled to funds from the Trust Account due to their ownership of Public Shares).

Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we have sufficient funds outside of the Trust Account or (ii) we consummate an initial business combination (which shall be the Business Combination should it occur). Our obligation to indemnify our officers and directors may discourage shareholders from bringing a lawsuit against our officers or directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors, even though such an action, if successful, might otherwise benefit us and our shareholders. Furthermore, a shareholder’s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant to these indemnification provisions.

If, after we distribute the proceeds in the Trust Account to our Public Shareholders, we file a bankruptcy or winding-up petition or an involuntary or winding-up bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors and us to claims of punitive damages.

If, after we distribute the proceeds in the Trust Account to our Public Shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is filed against us that is not dismissed, any distributions received by shareholders could be viewed under applicable debtor/creditor and/or bankruptcy or insolvency laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover some or all amounts received by our shareholders. In addition, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying Public Shareholders from the Trust Account prior to addressing the claims of creditors.

If, before distributing the proceeds in the Trust Account to our Public Shareholders, we file a bankruptcy or winding-up petition or an involuntary or winding-up bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our shareholders and the per-share amount that would otherwise be received by our shareholders in connection with our liquidation may be reduced.

If, before distributing the proceeds in the Trust Account to our Public Shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is filed against us that is not dismissed, the proceeds held in the Trust Account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our shareholders. To the extent any bankruptcy or insolvency claims deplete the Trust Account, the per-share amount that would otherwise be received by our shareholders in connection with our liquidation may be reduced.

You may only be able to exercise your Public Warrants on a “cashless basis” under certain circumstances, and if you do so, you will receive fewer Class A common stock from such exercise than if you were to exercise such warrants for cash.

The warrant agreement provides that in the following circumstances holders of warrants who seek to exercise their warrants will not be permitted to do for cash and will, instead, be required to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act: (i) if the Class A common stock issuable upon exercise of the warrants are not registered under the Securities Act in accordance with the terms of the warrant agreement; (ii) if we have so elected and the Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of “covered securities” under Section 18(b)(1) of the Securities Act; and (iii) if we have so elected and we call the Public Warrants for redemption. If you exercise your Public Warrants on a cashless basis, you would pay the warrant exercise price

 

86


Table of Contents

by surrendering all of the warrants for that number of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of Class A common stock underlying the warrants, multiplied by the excess of the “fair market value” of our Class A common stock (as defined in the next sentence) over the exercise price of the warrants by (y) the fair market value. The “fair market value” is the average reported last sale price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of exercise is received by the warrant agent or on which the notice of redemption is sent to the holders of warrants, as applicable. As a result, you would receive fewer shares of Class A common stock from such exercise than if you were to exercise such warrants for cash.

The grant of registration rights to certain holders, including PIPE Investors, and the future exercise of such rights may adversely affect the market price of our Class A common stock.

Upon the completion of the Business Combination, the Registration Rights Agreement will be entered into by and among Fathom Digital Manufacturing Corporation and certain other parties thereto, replacing Altimar II’s existing registration rights agreement. The Registration Rights Agreement in substantially the form it will be executed in connection with the Closing is attached to this proxy statement/prospectus as Annex F. Pursuant to the Registration Rights Agreement, the Legacy Fathom Owners, Sponsor and other Altimar II Founders, and, in each case, their permitted transferees and assigns will have customary registration rights (including demand, shelf and piggy-back rights, subject to cooperation and cut-back provisions). Further, pursuant to the Subscription Agreements, we agreed that we will use commercially reasonable best efforts (i) to file within 30 days after the closing of the Business Combination a registration statement with the SEC for a secondary offering of the PIPE Securities, (ii) to cause such registration statement to be declared effective promptly thereafter and (iii) to maintain the effectiveness of such registration statement until the earlier of (a) the date on which Sponsor and all of the independent directors cease to hold the securities covered thereby, and (b) the date all of the securities covered thereby can be sold publicly without restriction or limitation under Rule 144 under the Securities Act. In addition, the Subscription Agreements provide these holders will have certain “piggy-back” registration rights to include their securities in other registration statements filed by us. We will bear the cost of registering these securities. The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of the Class A common stock of Fathom.

We may have been a PFIC, which could result in adverse United States federal income tax consequences to U.S. investors.

Pursuant to a start-up exception, a corporation will not be a PFIC for the first taxable year the corporation has gross income (the “start-up year”), if (i) no predecessor of the corporation was a PFIC; (ii) the corporation satisfies the IRS that it will not be a PFIC for either of the first two taxable years following the start-up year; and (iii) the corporation is not in fact a PFIC for either of those two years. Altimar II believes, although subject to uncertainty, that Altimar II’s 2021 taxable year may be the start-up year and that Altimar II may not be treated as a PFIC for 2021. The application of the start-up exception will depend, in part, on whether the Domestication is consummated in 2021. In addition, the application of the start-up exception to the present transaction involves the application of complicated rules with respect to which there is no clear authority. Accordingly, there can be no assurance with respect to Altimar II’s status as a PFIC for 2021. If we have been a PFIC for any taxable year (or portion thereof) that is included in the holding period of a beneficial owner of Altimar II ordinary shares or warrants that is a “U.S. holder” as that term is defined in the section entitled “Material U.S. Federal Income Tax Considerations – U.S. Holders – PFIC Considerations,” such U.S. holder may be subject to certain adverse U.S. federal income tax consequences and may be subject to additional reporting requirements, including as a result of the Domestication. Our PFIC status for any taxable year will not be determinable until after the end of such taxable year. If we determine we are a PFIC for any taxable year, upon written request, Altimar II will endeavor to provide to a U.S. holder such information as the IRS may require, including a PFIC annual information statement, in order to enable the U.S. holder to make and maintain a “qualified electing fund” election, but there can be no assurance that we will timely provide such required information, and such election would be unavailable with respect to Altimar II warrants in all cases. The PFIC rules are complex and will depend on a

 

87


Table of Contents

holder’s particular circumstances. All U.S. holders are strongly urged to consult their tax advisors regarding the application and effect of the PFIC rules, including as a result of the Domestication, including the applicability and effect of U.S. federal, state, local and foreign income and other tax laws. For a more complete discussion of the potential application of the PFIC rules to U.S. holders as a result of the Domestication, “Material U.S. Federal Income Tax Considerations – U.S. Holders – PFIC Considerations.”

The provisions of the Amended and Restated Memorandum and Articles of Association that relate to the rights of holders of our Class A ordinary shares (and corresponding provisions of the agreement governing the release of funds from our Trust Account) may be amended with the approval of holders of at least two-thirds of our ordinary shares who attend and vote at a general meeting of Altimar II, which is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend the Amended and Restated Memorandum and Articles of Association to facilitate the completion of the Business Combination that some of our shareholders may not support.

Some other blank check companies have a provision in their charter which prohibits the amendment of certain of its provisions, including those which relate to the rights of a company’s shareholders, without approval by a certain percentage of the company’s shareholders. In those companies, amendment of these provisions typically requires approval by between 90% and 100% of the company’s shareholders. The Amended and Restated Memorandum and Articles of Association provide that any of its provisions related to the rights of holders of our Class A ordinary shares (including the requirement to deposit proceeds of the IPO and the Private Placement of Warrants into the Trust Account and not release such amounts except in specified circumstances, and to provide Redemption Rights to Public Shareholders as described herein) may be amended if approved by special resolution, meaning holders of at least two-thirds of our ordinary shares who attend and vote at a general meeting of Altimar II, and corresponding provisions of the trust agreement governing the release of funds from our Trust Account may be amended if approved by holders of 65% of our ordinary shares; provided that the provisions of our Amended and Restated Memorandum and Articles of Association governing the appointment or removal of directors prior to our initial business combination may only be amended by a special resolution passed by not less than two-thirds of our ordinary shares who attend and vote at our general meeting which shall include the affirmative vote of a simple majority of our Class B ordinary shares. Altimar II’s Sponsor and its permitted transferees, if any, who collectively beneficially owned 20% of our issued and outstanding Class A ordinary shares, will participate in any vote to amend the Amended and Restated Memorandum and Articles of Association and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions of the Amended and Restated Memorandum and Articles of Association which govern our pre-Business Combination actions more easily than some other special purpose acquisition companies, and this may increase our ability to complete the Business Combination with which you may not agree. Our shareholders may pursue remedies against us for any breach of the Amended and Restated Memorandum and Articles of Association.

Sponsor, executive officers and directors agreed, pursuant to agreements with us, that they will not propose any amendment to the Amended and Restated Memorandum and Articles of Association to modify the substance or timing of our obligation to provide for the redemption of our Class A ordinary shares in connection with the Business Combination or to redeem 100% of our Class A ordinary shares if we do not complete the Business Combination within 24 months from the closing of the IPO or with respect to any other provision relating to the rights of holders of our Class A ordinary shares, unless we provide our Public Shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to us to pay our income taxes, if any, divided by the number of then outstanding Class A ordinary shares. Our shareholders are not parties to, or third-party beneficiaries of, these agreements and, as a result, will not have the ability to pursue remedies against Sponsor, executive officers or directors for any breach of these agreements. As a result, in the event of a breach, our shareholders would need to pursue a shareholder derivative action, subject to applicable law.

 

88


Table of Contents

We may amend the terms of the warrants in a manner that may be adverse to holders of Public Warrants with the approval by the holders of at least 50% of the then outstanding Public Warrants. As a result, the exercise price of the warrants could be increased, the exercise period could be shortened and the number of Class A ordinary shares purchasable upon exercise of a warrant could be decreased, all without approval of each warrant affected.

Our warrants were issued in registered form under a warrant agreement between Continental Stock Transfer and Trust Company, as warrant agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of at least 50% of the then outstanding Public Warrants to make any change that adversely affects the interests of the registered holders of Public Warrants. Accordingly, we may amend the terms of the Public Warrants in a manner adverse to a holder if holders of at least 50% of the then outstanding Public Warrants approve of such amendment. Although our ability to amend the terms of the Public Warrants with the consent of at least 50% of the then outstanding Public Warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, convert the warrants into cash, shorten the exercise period or decrease the number of Class A ordinary shares or Class A common stock, as applicable, purchasable upon exercise of a warrant.

We may redeem unexpired warrants prior to their exercise at a time that is disadvantageous to holders of warrants, thereby making such warrants worthless.

We have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the last sale price of our Class A ordinary shares or Class A common stock, as applicable, equals or exceeds $18.00 per share (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) on each of 20 trading days within a 30 trading-day period ending on the third trading day prior to the date on which notice of such redemption is given. We will not redeem the warrants unless an effective registration statement under the Securities Act covering the Class A ordinary shares or Class A common stock, as applicable, issuable upon exercise of the warrants is effective and a current prospectus relating to those Class ordinary shares or Class A common stock, as applicable, is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of the outstanding warrants could force holders thereof to (i) exercise warrants and pay the exercise price therefor at a time when it may be disadvantageous for such holder to do so, (ii) sell warrants at the then-current market price when such holder might otherwise wish to hold warrants or (iii) accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of such warrants. None of the Private Placement Warrants will be redeemable by us so long as they are held by their initial purchasers or their permitted transferees.

In addition, we may redeem warrants after they become exercisable for a number of Class A common stock determined based on the redemption date and the fair market value of our Class A common stock. Any such redemption may have similar consequences to a cash redemption described above. In addition, such redemption may occur at a time when the warrants are “out-of-the-money,” in which case holders thereof would lose any potential embedded value from a subsequent increase in the value of the Class A common stock had such warrants remained outstanding.

Our warrants may have an adverse effect on the market price of our Class A common stock.

We issued warrants to purchase 8,625,000 of our Class A ordinary shares as part of the units offered in the IPO and, simultaneously with the closing of the IPO, we issued in a private placement an aggregate of 9,900,000 Private Placement Warrants, each exercisable to purchase one Class A ordinary share at $11.50 per share. Upon

 

89


Table of Contents

the Domestication, the warrants will entitle the holders to purchase shares of Class A common stock of Fathom. Such warrants, when exercised, will increase the number of issued and outstanding Class A common stock and reduce the value of the Class A common stock.

Compliance obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate the Business Combination, require substantial financial and management resources, and increase the time and costs of completing an acquisition.

Section 404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K for the year ending December 31, 2022. Only in the event we are deemed to be a large accelerated filer or an accelerated filer and no longer qualify as an emerging growth company will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. Further, for as long as we remain an emerging growth company, we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. Following the Business Combination, we will be required to assure that we are in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of our internal controls. The development of the internal control system to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete the Business Combination as well as impose obligations on Fathom following the Business Combination.

 

90


Table of Contents

INFORMATION ABOUT THE PARTIES TO THE BUSINESS COMBINATION

Altimar Acquisition Corp. II

Altimar Acquisition Corp. II is a blank check company incorporated on December 7, 2020 as a Cayman Islands exempted company organized for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. Immediately prior to the consummation of the Business Combination, Altimar Acquisition Corp. II intends to effect a deregistration under the Cayman Islands Companies Act (As Revised) and a domestication under Section 388 of the Delaware General Corporation Law, pursuant to which Altimar Acquisition Corp. II’s jurisdiction of incorporation will be changed from the Cayman Islands to the State of Delaware. For more information regarding Altimar II, see the section entitled “Information About Altimar II.”

Fathom OpCo

Fathom OpCo is headquartered in Hartland, Wisconsin. Fathom OpCo, doing business as “Fathom Digital Manufacturing,” is a leading on-demand digital manufacturing platform in North America, providing comprehensive product development and on-demand manufacturing services to many of the largest and most innovative companies in the world.

 

91


Table of Contents

THE BUSINESS COMBINATION AGREEMENT

This section describes the material provisions of the Business Combination Agreement and certain additional agreements entered into or to be entered into at Closing pursuant to the Business Combination Agreement (the “Related Agreements”) but does not purport to describe all of the terms thereof or include all of the additional agreements entered into or to be entered into pursuant to the Business Combination Agreement. The following summary is qualified in its entirety by reference to the complete text of the Business Combination Agreement and each of the Related Agreements. Shareholders and other interested parties are urged to read the Business Combination Agreement and such Related Agreements in their entirety.

Explanatory Note Regarding the Business Combination Agreement

The Business Combination Agreement and this summary are included to provide you with information regarding the terms of the Business Combination Agreement. The Business Combination Agreement contains representations and warranties by Altimar II and Fathom OpCo. The representations, warranties and covenants made in the Business Combination Agreement by Altimar II and Fathom OpCo were qualified and subject to important limitations agreed to by Altimar II and Fathom OpCo in connection with negotiating the terms of the Business Combination Agreement. In particular, in your review of the representations and warranties contained in the Business Combination Agreement and described in this summary, it is important to bear in mind that the representations and warranties were negotiated with the principal purpose of establishing circumstances in which a party to the Business Combination Agreement may have the right not to consummate the Business Combination if the representations and warranties of the other party were to be untrue due to a change in circumstance or otherwise, and allocating risk between the parties to the Business Combination Agreement, rather than establishing or attempting to set forth matters as facts. The representations and warranties also may be subject to a contractual standard of materiality different from that generally applicable to shareholders and reports and documents filed with the SEC and some representations, warranties and covenants were qualified by the matters contained in the confidential disclosure letters that Altimar II and Fathom OpCo each delivered in connection with the Business Combination Agreement and certain documents filed with the SEC. Moreover, information concerning the subject matter of the representations and warranties, which do not purport to be accurate as of the date of this proxy statement/prospectus, may have changed since the date of the Business Combination Agreement.

For the foregoing reasons, the representations and warranties or any descriptions of those provisions should not be read alone or relied upon as presenting the actual state of facts or condition of Altimar II or Fathom OpCo, or any of their respective subsidiaries or affiliates. Instead, such provisions or descriptions should be read only in conjunction with the other information provided elsewhere in this document or incorporated by reference into this proxy statement/prospectus. Please see the section entitled “Where You Can Find More Information.” Altimar II will provide additional disclosures in its public reports to the extent it is aware of the existence of any material facts that are required to be disclosed under federal securities laws and that might otherwise contradict the terms and information contained in the Business Combination Agreement and will update such disclosure as required by federal securities laws.

Background of the Business Combination

The following chronology summarizes the key meetings and events that led to the signing of the Business Combination Agreement. This chronology does not purport to catalogue every conversation or correspondence among representatives of Altimar II, Fathom OpCo, their respective representatives or any other party.

Altimar II is a blank check company incorporated on December 7, 2020 as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. Our sponsor, Altimar Sponsor II, LLC (the “Sponsor”), is affiliated with HPS Investment Partners, LLC (“HPS”), a global investment firm with approximately $72 billion

 

92


Table of Contents

of assets under management as of June 1, 2021. Altimar II’s strategy is to pursue companies that it believes are poised to experience strong growth and possess business models that are or will be strong cash flow generators and to leverage HPS’ deal sourcing platform and the deep relationships of HPS’ experienced principals to identify such companies in four key industries: (1) technology, media and telecommunications, (2) healthcare, (3) financial services / financial technology and (4) consumer. Altimar II’s focus on these industries was driven in part by the expertise, experience and extensive contacts of its Sponsor with participants in each of those industries, including financial services, however Altimar II was not constrained to pursue opportunities in only these industries.

On February 4, 2021, Altimar II announced the pricing of its IPO.

On February 5, 2021, Altimar II’s capital stock began trading on NYSE. Prior to the consummation of the IPO, neither Altimar II, nor anyone on its behalf, had any substantive discussions, formal or otherwise, with respect to a potential business combination transaction with Altimar II.

After its IPO, Altimar II commenced an active search for prospective businesses and assets to acquire. Representatives of Altimar II and our Sponsor contacted and were contacted by a number of individuals and entities with respect to business combination opportunities. As part of this process, representatives of Altimar II considered and evaluated over 50 potential acquisition targets in a wide variety of industry sectors and entered into non-disclosure agreements with 19 such potential acquisition targets (including, on May 16, 2021, a non-disclosure agreement with Fathom OpCo).

As part of its regular evaluation of potential acquisition targets, Altimar II’s Board and management would meet on a regular basis to discuss the status of management’s discussions with potential acquisition targets. These updates would generally address the potential targets under consideration and the status of the discussions, if any, with the respective acquisition targets, and the updates continued throughout the period of time when Altimar II was evaluating various acquisition targets.

Of the 19 potential acquisition targets with respect to which Altimar II entered into non-disclosure agreements, representatives of Altimar II and the Sponsor participated in management presentations and engaged in due diligence and discussions directly with the applicable senior executives, shareholders and bankers of Fathom OpCo and four other potential acquisition targets. Altimar II submitted bids for each of the five potential acquisition targets and entered into letters of intent with two of the five potential acquisition targets (including Fathom OpCo). Altimar II did not proceed with finalizing a potential transaction with any potential acquisition targets other than Fathom OpCo due to variety of factors, including the absence of a mutually acceptable agreement on valuation and other key deal terms and decisions to pursue potential alternative transactions.

The proposed Business Combination with Fathom OpCo follows a search for a potential transaction utilizing the global network and investing and operating experience of Altimar II’s executive officers, principals of the Sponsor and its affiliates, and the members of Altimar II’s Board. The terms of the Business Combination Agreement and the Business Combination are the result of an arm’s length negotiation between representatives of Altimar II and Fathom OpCo following a competitive process to select a SPAC partner conducted by Fathom OpCo and CORE Industrial Partners (“CORE”, a private equity firm and majority owner of Fathom OpCo).

Altimar II decided to pursue an acquisition of Fathom OpCo because it determined that Fathom OpCo represented a compelling opportunity given its existing operations and financial performance, strong management team, strong growth and margin profile, and fast-growing and large market opportunity.

On May 18, 2021, a representative of Altimar II had a no-names discussion with Stifel, Nicolaus & Company, Incorporated (“Stifel”) regarding a potential opportunity for Altimar II.

Also on May 18, 2021, Stifel provided preliminary information about Fathom and a draft non-disclosure agreement (the “NDA”) to be executed by Altimar II in order that it may be granted access to additional information and to facilitate its due diligence review and participation in a competitive process.

 

93


Table of Contents

On May 26, 2021, Altimar II entered into the NDA with Fathom OpCo.

On May 27, 2021, representatives of the Sponsor accessed a digital data room, which contained a written management presentation, a financial model, a capitalization table, a third-party commercial industry report, and a process letter. Altimar II also received access to a draft of the non-binding letter of intent for a potential transaction regarding Fathom OpCo (the “LOI”), which LOI included a binding exclusivity provision.

On May 28, 2021, Altimar II’s Board held a board meeting to review Altimar II’s acquisition pipeline, including the potential Business Combination with Fathom OpCo.

On June 2, 2021, representatives of Altimar II and the Sponsor met by telephone with representatives of the J.P. Morgan Securities LLC (“J.P. Morgan”) M&A Advisory Group to, at the direction of Fathom OpCo, discuss the SPAC selection process and Fathom OpCo’s business.

On June 3, 2021, representatives of Altimar II and the Sponsor met by videoconference with the Fathom OpCo principals, and with representatives of Fathom OpCo’s financial advisors, J.P. Morgan’s M&A Advisory Group and Stifel, in attendance to discuss the potential business combination transaction. During the meeting, representatives of Fathom OpCo provided the Altimar II attendees with an overview of the business as well as the proposed key terms of the potential transaction. The parties also discussed the competitive nature of the process to identify a SPAC partner, which included several other SPACs, as well as Altimar II’s ability to help raise financing in connection with the potential transaction.

Also on June 3, 2021, representatives of Altimar II and Sponsor contacted representatives of Credit Suisse Securities (USA) LLC (“Credit-Suisse”), Altimar II’s financial advisor, for assistance in evaluating the Fathom OpCo opportunity and in preparing Altimar II’s bid package, including the draft LOI that Altimar II planned to submit as part of the Fathom OpCo SPAC selection process.

On June 4, 2021, representatives of Altimar II and its Sponsor met by videoconference with Fathom OpCo principals, and with representatives of J.P. Morgan’s M&A Advisory Group and Credit-Suisse in attendance, to discuss the financial model previously provided to Altimar II and the proposed terms of the potential transaction. The Fathom OpCo principals responded to questions posed by representatives of the Sponsor and Credit-Suisse.

Also on June 4, 2021, representatives of Altimar II and its Sponsor met by videoconference with representatives of CORE to discuss a potential transaction with Fathom OpCo and later, with representatives of Credit-Suisse to discuss Fathom’s industry and public company comparables.

On June 5, 2021, representatives of Altimar II and its Sponsor met telephonically with representatives of Paul, Weiss, Rifkind, Wharton & Garrison LLP (“Paul, Weiss”), outside counsel to Altimar II, and Credit-Suisse to review the terms of the LOI.

On June 6, 2021, representatives of Altimar II and its Sponsor sent CORE, J.P. Morgan’s M&A Advisory Group and Stifel a revised draft of the LOI as well as a supplementary presentation, including Altimar II and its Sponsor’s valuation perspectives, setting forth the proposed terms of a business combination between Altimar II and Fathom OpCo.

On June 10, 2021, representatives of Altimar II and its Sponsor met telephonically with representatives of J.P. Morgan’s M&A Advisory Group to , at the direction of Fathom OpCo, clarify certain terms of the revised LOI.

Also on June 10, 2021, representatives of the Altimar II and its Sponsor sent CORE, J.P. Morgan’s M&A Advisory Group, and Stifel a presentation highlighting revised business terms based on Fathom OpCo’s feedback.

 

94


Table of Contents

On June 11, 2021, representatives of Altimar II and its Sponsor met telephonically with representatives of J.P. Morgan’s Equity Capital Markets Group to further discuss the key terms of the potential transaction as well as Altimar II’s ability to assist with raising the capital required in connection with the potential Business Combination. Following such discussions, Altimar II was informed that Fathom OpCo and CORE were inclined to partner with Altimar II.

Also on June 11, 2021, Altimar II’s Board held a board meeting to review Altimar II’s acquisition pipeline, including the potential Business Combination with Fathom OpCo.

On June 12, 2021, representatives of Altimar II and its Sponsor met telephonically with representatives of Paul, Weiss and Credit-Suisse to review the terms of the revised LOI.

On June 14, 2021, Altimar II was informed that its revised LOI prevailed over the submissions received from other SPACs and it was asked to execute the LOI expeditiously. After consultation with and approval by the members of board of directors, Altimar II, and Fathom OpCo executed the LOI.

On June 15, 2021, representatives of Altimar II and its Sponsor, CORE, Fathom OpCo, J.P. Morgan’s Equity Capital Markets Group, Stifel and Credit-Suisse met by videoconference to discuss the PIPE capital raise in connection with the Business Combination.

On June 16, 2021, Altimar II and Credit-Suisse executed an engagement letter, which provides that Credit-Suisse will serve as exclusive financial and capital markets advisor with respect to the Business Combination with Fathom OpCo.

On June 17, 2021, in order to enable Altimar II to conduct its due diligence review, Altimar II and its advisors were granted access to a digital data room that included confidential information regarding the business and operations of Fathom OpCo.

On June 18, 2021, Altimar II provided an update to its board of directors on the potential Business Combination with Fathom OpCo.

On June 21, 2021, Altimar II entered into an engagement letter with J.P. Morgan and Stifel, which provides that J.P. Morgan’s Equity Capital Markets Group and Stifel will serve as co-placement agents in connection with the PIPE Investment.

On June 22, 2021, J.P. Morgan’s Equity Capital Markets Group and Stifel began the process of contacting potential investors who have a track record of long-term investments and interest in investing in transactions similar to the transaction contemplated by the LOI on a “wall cross” basis to arrange for investor meetings with representatives of Altimar II and Fathom regarding their potential participation in the PIPE Investment. From June 22, 2021 through July 13, 2021, representatives of Altimar II and Fathom OpCo together with representatives of J.P. Morgan’s Equity Capital Markets Group and Stifel held over twenty-five investor meetings with certain potential investors in the PIPE Investment and representatives of Fathom OpCo provided certain potential PIPE Investors with access to a digital data room containing financial and business information regarding Fathom OpCo.

On June 25, 2021, representatives of Paul, Weiss submitted a due diligence request list to representatives of Fathom OpCo.

Also on June 25, 2021, Altimar II provided an update to its board of directors on the potential Business Combination with Fathom OpCo.

On June 29, 2021, representatives of Winston & Strawn LLP (“Winston”), counsel to Fathom OpCo, provided Paul, Weiss with an initial draft of the Business Combination Agreement and the subscription

 

95


Table of Contents

agreement relating to the PIPE Investment. Over the next several days, representatives of each of Paul, Weiss and Winston exchanged drafts and discussed open issues in order to finalize a draft of the Subscription Agreement to be shared with potential investors in the PIPE Investment.

On July 7, 2021, representatives of Paul, Weiss sent a markup of the Business Combination Agreement to Winston. Representatives of Winston also provided representatives of Paul, Weiss with drafts of the Proposed Charter, Proposed Bylaws, Investor Rights Agreement and Registration Rights Agreement.

On July 8, 2021, representatives of Paul, Weiss provided representatives of Winston with a draft of the Forfeiture and Support Agreement.

On July 9, 2021, the Board met by video conference with representatives of Paul, Weiss and Credit-Suisse in attendance to discuss the Business Combination and other matters. At the meeting, representatives of Paul, Weiss reviewed the fiduciary duties of members of the Board under applicable laws, representatives of the Sponsor provided a presentation on the potential transaction and Credit-Suisse reviewed the financial terms of the proposed transaction with members of the Board and discussed, among other things, the total transaction value, the pro forma ownership and governance of the post-closing company and the sources of funds for the transaction, including the PIPE Investment.

On July 9, 2021, representatives of Paul, Weiss sent Winston revised drafts of the Investor Rights Agreement, Proposed Charter and Proposed Bylaws, and the Registration Rights Agreement.

On July 10, 2021, representatives of Paul, Weiss met telephonically with representatives of Fathom OpCo as part of Altimar II’s due diligence review of Fathom OpCo. Representatives of Paul, Weiss discussed questions regarding Fathom OpCo’s legal structure, compliance functions and other legal diligence matters.

Also on July 10, 2021, representatives of Paul, Weiss sent a markup of the Forfeiture and Support Agreement and a revised draft of the Subscription Agreement to Winston.

On July 11, 2021, representatives of Winston provided Paul, Weiss with revised drafts of the Proposed Charter and Proposed Bylaws, the Investor Rights Agreement and the Registration Rights Agreement.

On July 12, 2021, representatives of the Sponsor and representatives of Paul, Weiss met telephonically to discuss issues presented by the draft of the Business Combination Agreement, Proposed Charter and Proposed Bylaws, the Investor Rights Agreement and Registration Rights Agreement, including restrictions on transfers and rights of the holders of capital stock of the surviving company. Representatives of Paul, Weiss sent revised drafts of the Registration Rights Agreement and the Subscription Agreement to Winston. Representatives of Winston also then provided Paul, Weiss with initial drafts of the Fathom Operating Agreement and Tax Receivable Agreement, as well as a markup of the Business Combination Agreement.

Also on July 12, 2021, representatives of the Sponsor met by videoconference with CORE, in each case together with legal counsel and financial advisors for each party in attendance, to discuss open issues in the Business Combination Agreement and the other documents being negotiated in connection with the proposed Business Combination contemplated by the LOI.

On July 13, 2021, representatives of Paul, Weiss and Winston met telephonically to discuss issues presented by the draft of the Business Combination Agreement.

Also on July 13, 2021, representatives of Paul, Weiss and representatives of Winston met telephonically to discuss issues presented by the draft of the Proposed Charter, Proposed Bylaws, Investor Rights Agreement and Registration Rights Agreement. Representatives of Paul, Weiss also then provided Winston with revised drafts of the Investor Rights Agreement, the Proposed Charter and Proposed Bylaws and the Subscription Agreement. Representatives of Winston also then provided Paul, Weiss with revised drafts of the Omnibus Incentive Plan and the Forfeiture and Support Agreement and the Voting and Support Agreement.

 

96


Table of Contents

On July 14, 2021, representatives of the Sponsor met twice by videoconference with CORE, in each case together with legal counsel for each party, to discuss open issues in the Business Combination Agreement and the other documents being negotiated in connection with the proposed Business Combination contemplated by the LOI. Key issues discussed, among others, were the status of certain diligence items and related disclosures as well as developments relating to the PIPE Investment.

Also on July 14, 2021, representatives of Paul, Weiss provided Winston with a markup of the draft Tax Receivable Agreement and revised drafts of the Business Combination Agreement and Fathom Operating Agreement; Winston provided Paul, Weiss with a revised draft of the Employee Stock Purchase Plan; and Paul, Weiss and Winston exchanged revised drafts of the Forfeiture and Support Agreement, Voting and Support Agreement and Subscription Agreement.

On July 15, 2021, the Board met by videoconference with representatives of the Sponsor and Paul, Weiss in attendance. Representatives of the Sponsor provided an update on the transaction, including the status of the PIPE capital raise and legal documentation. Representatives of Paul, Weiss reviewed the current status of transaction negotiations, the resolutions to be approved by the Board in connection with entering into the proposed transactions and the provisions of the proposed Business Combination Agreement and other agreements and documents to be approved by the Board in connection with the proposed Business Combination. During the meeting, the Board discussed and considered the proposed transaction. Following such discussion and a question and answer session, certain members of the Board (and, later all members of the Board) unanimously (i) determined, among other things, that the Business Combination Agreement, the Business Combination and related transaction documentation and other transactions contemplated thereby were advisable and in the best interests of Altimar II and its stockholders, (ii) approved the form, terms and provisions of, and the transactions contemplated by, the Business Combination Agreement, including the Business Combination, and the related transaction documentation and other transactions contemplated thereby, including the PIPE Investment and other matters required to be submitted to votes of the stockholders, (iii) authorized Altimar II to enter into the Business Combination Agreement and the other transaction documents and perform each of its obligations thereunder, including the Business Combination and the PIPE Investment and (iv) resolved to recommend to the shareholders of Altimar II that they vote to approve the proposals to be submitted to the shareholders of Altimar II with respect to the transactions contemplated by the Business Combination Agreement and the PIPE Investment, among other things. During the meeting, Altimar II’s Board also ratified Altimar II’s entry into the engagement letter between Altimar II and J.P. Morgan’s Equity Capital Markets Group as well as the engagement letter among Altimar II, J.P. Morgan’s Equity Capital Markets Group and Stifel pursuant to which J.P. Morgan’s Equity Capital Markets Group and Stifel would act as co-placement agents in connection with the PIPE Investment.

Also on July 15, 2021, representatives of the Sponsor twice met by videoconference with CORE, in each case together with legal counsel and financial advisors for each party in attendance, to discuss outstanding issues in the Business Combination Agreement and related ancillary documents. Additionally, the parties and the Placement Agents met to discuss the results of its PIPE Investment process and to discuss allocations for investors.

During the evening of July 15, 2021, the parties finalized drafts of the key transaction documents and agreed to enter into the Business Combination Agreement, the Subscription Agreements, the Forfeiture and Support Agreement and related transaction documents, and prior to the commencement of trading of Altimar II’s ordinary shares on the NYSE, the parties issued a press release on July 16, 2021 announcing the transactions.

Altimar II’s Board of Directors’ Reasons for Approval of the Business Combination

The Board, in evaluating the business transaction, consulted with Altimar II’s management, legal counsel and financial advisor. In reaching its conclusion to recommend that Altimar II’s shareholders approve the Business Combination Agreement and the transactions contemplated thereby, including the Business

 

97


Table of Contents

Combination, our Board considered and evaluated a number of factors, including, but not limited to, the factors discussed below. In light of the complexity of those factors, Altimar II’s directors considered these factors as a whole, and did not consider it practicable to, nor did it attempt to, quantify or otherwise assign relative weights to the specific factors it took into account in reaching its decision. Individual members of the Board may have given different weight to different factors. This explanation of the reasons for the Board approval of the Business Combination, and all other information presented in this section, is forward-looking in nature and, therefore, should be read in light of the factors discussed under “Cautionary Statement Regarding Forward-Looking Statements.

Before reaching its decision, the Board reviewed the results of the due diligence review conducted by its management, employees of Sponsor and its affiliates and their respective advisors, which included:

 

   

numerous meetings and calls with the management team and advisors of Fathom OpCo regarding operations and forecasts;

 

   

review of material contracts, material liabilities and other material matters;

 

   

financial, legal, insurance, and accounting due diligence;

 

   

consultation with Altimar II management and legal counsel and financial advisor;

 

   

review of Fathom OpCo’s historical financial performance (including audited and unaudited financials) and management projections for the business; and

 

   

financial and valuation analyses of the business of Fathom.

In the prospectus for the IPO, Altimar II identified certain criteria that Altimar II believed would be important in evaluating prospective target businesses, namely businesses with world class management teams and a compelling organic growth plan, coupled with a compelling business model that is materially cash generative at maturity. Altimar II indicated that its goal was to deliver public shareholders an opportunity to own a long term, durable compounding equity investment that can produce strong returns.

Based on its review of the industry data and the operational, financial and other relevant information related to the Fathom business, provided by Fathom and presented to the Board, the factors considered by Altimar II Board included, but were not limited to, the following:

 

   

Fathom OpCo is an Attractive Business Opportunity. The Board considered the fact that the Fathom OpCo business (i) is of a sufficient size relevant to the public marketplace, (ii) has a strong existing management team, (iii) has a significant total addressable market and growth expansion opportunities, and (iv) would benefit from the consummation of the Business Combination by becoming a public company, which the Board believed would improve the ability of business to grow.

 

   

Large and Expanding Growth Industry. Fathom is a leading on-demand manufacturing company in a $25+ billion low-to-mid volume manufacturing market, with robust long-standing operations and strong cash flow generation. Fathom expects wider adoption of Industry 4.0 technologies, which include additive manufacturing, CNC machining, injection molding, precision metal fabrication and other ancillary technologies, as the industry shifts from a focus on prototyping to adoption by mass manufacturers. In addition, Fathom OpCo expects the Industry 4.0 to benefit from the reshaping of new product development cycles as corporations continue to re-shore manufacturing activities, digitalize product development, mass customize products and search for higher value add, all at lower cost with shorter lead times.

 

   

Growth Prospects. Fathom OpCo has an extensive product offering and has historically demonstrated customer demand across a diverse array of industries with little account concentration. In addition, customer demand for Fathom OpCo’s products and services is expected to position Fathom to realize strong growth prospects within the low-to-mid volume manufacturing market and adjacent markets.

 

98


Table of Contents
   

Platform Supports Further Growth Initiatives. Fathom OpCo has a highly attractive solutions platform with the potential to yield strong organic growth driven by the acceleration in on-demand manufacturing capabilities, including additive manufacturing and injection molding technologies. Fathom OpCo is positioned to capture growth across several markets through its robust portfolio growth with healthy upside to expand across a diversified revenue profile and technology offerings.

 

   

Industry Leading Technology Platform and Proprietary Information. Fathom OpCo’s Industry 4.0 solutions are highly differentiated and supported by a broad technology portfolio of proprietary and differentiated technologies. Fathom is uniquely positioned as the only “full service” outsourced solution built to serve the manufacturing needs of enterprise-grade customers.

 

   

Deep Relationships with a Broad and Diverse Customer Base. Fathom OpCo has a broad, diversified and growing customer base with demonstrated customer demand across a variety of industries.

 

   

Attractive Valuation. The Board’s view, after consulting with its financial advisor and consultants, and supported by financial analysis performed by the Sponsor and its affiliates, that the Business Combination offers an attractive valuation for Altimar II’s shareholders. In reaching this conclusion, the Board considered various financial ratios of Fathom OpCo and its peer groups based on historical performance and projected financial performance.

 

   

Experienced and Proven Management Team. Following completion of the Business Combination, the combined business will be led by a senior management team composed of the same senior management teams that have operated Fathom OpCo prior to the Business Combination and developed Fathom OpCo into the highly reputable and successful company that it is today. Fathom OpCo’s management team has a proven track record of operational excellence, financial performance and growth. In addition, Fathom OpCo’s Board will be comprised of experienced directors, including, among others, Robert Nardelli, former Chairman and CEO of Chrysler Corporation and The Home Depot, and George Buckley, Chairman of Stanley Black & Decker and former Chairman and CEO of 3M.

 

   

Continued Ownership by the Key Holders. The Board considered that Legacy Fathom Owners would own approximately 63.9% of the economic interests in Fathom following the Business Combination (assuming no redemptions by Altimar II Public Shareholders and the other assumptions set forth in “Unaudited Pro Forma Combined Financial Information”), reflecting their confidence in the Fathom business and the continued growth prospects of the Fathom business going forward. Additionally, Fathom’s current equityholders will receive part of their share of the consideration from the Business Combination in the form of unvested equity which will be subject to certain vesting terms and conditions.

 

   

Due Diligence. Due diligence examinations of Fathom OpCo conducted by Altimar II and its advisors in several areas, including financial, legal, insurance, and accounting, and related discussions between Altimar II and such advisors with Fathom OpCo’s management in connection therewith.

 

   

Terms and Conditions of the Business Combination Agreement. The terms and conditions of the Business Combination Agreement and the transactions contemplated thereby, including the Business Combination, were, in the opinion of the Board, consistent with similar transactions and the product of arm’s-length negotiations between the parties.

 

   

Stockholder Liquidity. The obligation in the Business Combination Agreement to have Class A common stock issued as consideration listed on the NYSE, a major U.S. stock exchange, which the Board believes has the potential to offer stockholders enhanced liquidity.

 

   

Involvement of the PIPE Investors. The Board considered that the agreement of the PIPE Investors to invest $80 million in the combined business at Closing at $10.00 per share was a validation of the valuation being ascribed to, and future prospects of, the combined business.

 

   

Changes to Altimar II Capital Structure. Altimar II Founders agreed to enter into a Forfeiture and Support Agreement in connection with the Business Combination which provides, among other things,

 

99


Table of Contents
 

that Sponsor will waive any additional anti-dilution rights on behalf of Sponsor and the other Altimar II Founders. Additionally, the Altimar II Founders agreed to forfeit up to 15% of their Class A common stock pursuant to the terms of the Business Combination Agreement and the Forfeiture and Support Agreement, which they would otherwise receive at the closing of the Business Combination upon the automatic conversion of their Class B ordinary shares.

 

   

Altimar II Shares Subject to Vesting. Pursuant to the Forfeiture and Support Agreement, 15% of Sponsor’s Class B ordinary shares (or, following the Domestication, shares of Class C common stock or Class A common stock, as applicable) will be unvested and restricted. Such shares will vest automatically upon (a) the VWAP of the Class A common stock equaling or exceeding $15.00 per share for any 20 trading days within a period of 30 consecutive trading days and (b) a change of control of Altimar II. If the unvested shares have not vested on or before the fifth anniversary of the Closing Date, such unvested shares will be automatically forfeited.

In the course of its deliberations, in addition to the various other risks associated with the combined business, as described in the section entitled “Risk Factors” appearing elsewhere in this proxy statement/prospectus, the Board also considered a variety of uncertainties, risks and other potentially negative reasons relevant to the business combination, including the following:

 

   

Macroeconomic Risks. Macroeconomic uncertainty, including the potential impact of the COVID-19 pandemic, and the effects they could have on the combined company’s revenues and financial performance.

 

   

Business Plan and Projections May Not Be Achieved. The risk that the combined business may not be able to execute on its business plan, and realize the financial performance as set forth in the financial projections, in each case, presented to management of Altimar II and that the historical returns attributable to Fathom OpCo may not be indicative of the future results of the combined business, which could materially affect its valuation.

 

   

Potential Misalignment of Interests between Fathom and the Public Stockholders. The interests of the Fathom equityholders may not be aligned with the interests of the Class A common stock holders relating to, among other things, the nomination and appointment of directors to Fathom’s Board and the conduct of Fathom’s business.

 

   

Growth Initiatives May Not be Achieved. The risk that Fathom’s growth initiatives may not be fully achieved or may not be achieved within the expected timeframe.

 

   

No Third-Party Valuation. The fact that Altimar II did not obtain a third-party valuation or fairness opinion in connection with the Business Combination.

 

   

Liquidation. The risks and costs to Altimar II if the Business Combination is not completed, including the risk of diverting management focus and resources from other businesses combination opportunities, which could result in Altimar II being unable to effect a business combination within the completion window which would require Altimar II to liquidate.

 

   

Exclusivity. The fact that the Business Combination Agreement includes non-solicitation provision that prohibits Altimar II from soliciting other initial business combination proposals, which restricts Altimar II’s ability to consider other potential initial business combinations prior to the Closing or termination of the Business Combination Agreement. Altimar II’s Board, in certain circumstances, may change its recommendation in favor of the Business Combination, subject to the terms and conditions of the Business Combination Agreement.

 

   

Restrictions in the Conduct of Business. The requirement that Fathom OpCo conducts its business in the ordinary course and the other restrictions on the conduct of Fathom OpCo’s business prior to the consummation of the Business Combination, which may delay or prevent Fathom OpCo from undertaking business opportunities that may arise pending the completion of the Business Combination.

 

100


Table of Contents
   

Distraction to Operations. The risk that the potential diversion of the management of the business and employee attention as a result of the Business Combination and the fact that Fathom OpCo will become a public company may adversely affect operations of the business.

 

   

Shareholder Vote. The risk that Altimar II’s shareholders may object to and challenge the Business Combination and take action that may prevent or delay the consummation of the Business Combination, including to vote down the proposals at the special meeting, not vote in favor of any extension of Altimar II’s time frame to complete the Business Combination or redeem their shares.

 

   

Closing Conditions. The fact that completion of the Business Combination is conditioned on the satisfaction of certain closing conditions that are not within Altimar II’s control.

 

   

Altimar II Shareholders Holding a Minority Position in the Post-Combination Company. Following completion of the Business Combination, Altimar II’s Public Shareholders will own approximately 25% of the common stock of Fathom (assuming that no shares of Altimar II’s Class A ordinary shares are elected to be redeemed by Altimar II Public Shareholders).

 

   

Governance and Structure of the Fathom Board. The fact that the Fathom Board will be a classified board, and will be initially comprised of eleven directors, as follows: ten directors designated by CORE, and one independent director to be jointly designated by CORE and the Sponsor.

 

   

Control of Fathom’s Board. The fact that following the Business Combination, CORE will have the right to nominate to the Board a number of designees equal to at least 50% of the total number of directors, so long as CORE beneficially owns shares of Fathom’s common stock representing at least a majority of the amount owned by CORE at the time of the consummation of the Business Combination. In addition, CORE will have other rights, preferences or privileges not available to other shareholders, including the right to appoint a non-voting observer to Altimar II’s Board for as long as CORE owns at least 5% of the shares owned by CORE at the Closing.

 

   

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.

 

   

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

 

   

Redemptions. The risk that current Altimar II Public Shareholders would exercise their redemption rights, thereby depleting the amount of cash available in the Trust Account.

 

   

NYSE Listing. The potential inability to maintain listing of Fathom’s securities on NYSE following the Business Combination.

In addition to considering the factors described above, the Altimar II Board also considered that:

 

   

Interests of Certain Persons. Some officers and directors of Altimar II may have interests in the Business Combination as individuals that are in addition to, and that may be different from, the interests of Altimar II’s shareholders. See the section entitled “Certain Relationships and Related Party Transactions” for more information. Altimar II’s directors reviewed and considered these interests during the negotiation of the Business Combination and in evaluating and unanimously approving, as members of the Altimar II Board, the Business Combination Agreement and the transactions contemplated therein, including the Business Combination.

 

   

Other Risks Factors. Various other risk factors associated with the business of Fathom and the combined business described in the section entitled “Risk Factors” beginning on page 49 of this proxy statement/prospectus.

After considering the foregoing, the Board concluded that the potential benefits to Altimar II and its shareholders relating to the Business Combination outweighed the potentially negative factors relating to the

 

101


Table of Contents

Business Combination. Accordingly, the Altimar II board of directors determined that the Business Combination Agreement and the transactions contemplated thereby, including the Business Combination, were advisable, fair to, and in the best interests of Altimar II and its shareholders. The Board therefore recommends that the shareholders of Altimar II vote to approve the proposals to be submitted to the shareholders of Altimar II with respect to the transactions contemplated by the Business Combination Agreement and the Business Combination, among other things.

Transaction Structure

 

  (a)

Altimar II will change its jurisdiction of incorporation by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation under the laws of the State of Delaware (the “Domestication”), upon which Altimar II will change its name to “Fathom Digital Manufacturing Corporation.”

 

  (b)

Fathom OpCo will issue managing member interests in Fathom OpCo to Altimar II in exchange for a nominal cash payment;

 

  (c)

Following step (b) above, each of CORE Fund I Blocker-5 LLC, a Delaware limited liability company (“Fathom Blocker 1”), CORE Fund I Blocker-2 LLC, a Delaware limited liability company (“Fathom Blocker 2”), and SG (MCT) Blocker, LLC, a Delaware limited liability company (Fathom Blocker 3” and, together with Fathom Blocker 1 and Fathom Blocker 2, the “Fathom Blockers”), will merge with and into Rapid Blocker 1 Merger Sub, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II (“Blocker Merger Sub 1”), Rapid Blocker 2 Merger Sub, LLC , a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II (“Blocker Merger Sub 2”), and Rapid Blocker 3 Merger Sub, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II (“Blocker Merger Sub 3” and, together with Blocker Merger Sub 1 and Blocker Merger Sub 2, the “Blocker Merger Subs”), respectively, in each case, with the Fathom Blockers surviving as the surviving companies and wholly owned subsidiaries of Altimar II (collectively, the “Surviving Fathom Blockers”);

 

  (d)

Immediately following step (c) above, the Surviving Fathom Blockers will each merge with and into Altimar II (the “Blocker Altimar Mergers”), in each case, with Altimar II as the surviving company; and

 

  (e)

Immediately following the Blocker Altimar Mergers, Rapid Merger Sub will merge with and into Fathom OpCo (the “Fathom Merger”), with Fathom OpCo as the surviving entity of the Fathom Merger (Fathom OpCo, in its capacity as the surviving entity of the Fathom Merger, is sometimes referred to as the “Fathom Surviving Entity”). Following the Fathom Merger, the Fathom Surviving Entity will be owned by Altimar II and all other holders of Fathom OpCo units outstanding as of immediately prior to the Fathom Merger (such other holders, excluding Altimar II are referred to as the “Continuing Fathom Unitholders”).

Upon consummation of the transactions contemplated by the Business Combination Agreement, the combined company will be organized in an “Up-C” structure, in which substantially all of the assets and business of the combined company will be held by Fathom OpCo. Altimar II and the Continuing Fathom Unitholders will be issued Class A units of Fathom OpCo (“New Fathom Units”). Altimar II will be the managing member of Fathom OpCo. Altimar II will issue to Continuing Fathom Unitholders for cash at par value a number of shares of Class B common stock equal to the number of New Fathom Units held by the Continuing Fathom Unitholders. Altimar II’s other shareholders will hold Class A common stock of the combined company. Shares of Class A common stock will be entitled to economic rights and one vote per share and shares of Class B common stock will be entitled to one vote per share but no economic rights. The combined company’s business will continue to operate through Fathom OpCo.

 

102


Table of Contents

Post-Business Combination Ownership Structure

The diagram below depicts a simplified version of Fathom’s organizational structure immediately following the completion of the Domestication and the Business Combination.

 

LOGO

Notes:

 

1.

Altimar II Founders include Altimar Sponsor II, LLC and the seven current directors of Altimar II.

 

2.

The warrants held by Public Shareholders are Public Warrants and the warrants held by Altimar Sponsor II, LLC are Private Placement Warrants.

 

3.

Legacy Fathom Owners include Fathom Blocker Owners and Continuing Fathom Unitholders.

 

4.

The Class B common stock is non-economic, voting stock of Fathom.

 

5.

New Fathom Units owned by the Continuing Fathom Unitholders are exchangeable on a one-for-one basis for shares of Class A common stock (with corresponding surrender of an equal number of shares of Class B common stock for cancellation by Fathom), in accordance with the Fathom Operating Agreement.

 

103


Table of Contents

Closing Funding

At the Closing, Fathom OpCo will use all amounts then available in the Trust Account (net of amounts required to redeem any Altimar Public Shareholders exercising their respective Redemption Rights) plus the proceeds of the PIPE Investment that will occur in connection with the Business Combination to make the cash payments described below under “Consideration to be Received in the Business Combination.” Fathom OpCo will use any remaining amounts to pay the transaction expenses of Altimar II, Fathom OpCo and otherwise for general corporate purposes.

Consideration to be Received in the Business Combination

The total consideration to be paid to the Fathom Blocker Owners and the Continuing Fathom Unitholders (each as defined herein), including CORE Industrial Partners Fund I, LP, at the Closing shall equal the aggregate of:

 

  (a)

(i) All the cash proceeds from the Trust Account established for the purpose of holding the net proceeds of Altimar II’s initial public offering, net of any amounts paid to Altimar II’s shareholders that exercise their redemption rights in connection with the Business Combination, together with the proceeds from the PIPE Investment (as defined herein) (the “Available Cash Amount”), (ii) minus up to $25,000,000 to be contributed by Altimar II to the balance sheet of Fathom OpCo (the “Balance Sheet Contribution”), (iii) minus up to $42,000,000 to be used to pay down certain indebtedness of Fathom OpCo, (iv) minus certain transaction expenses of Fathom OpCo and Altimar II, which include fees and expenses of various advisors, transfer taxes, employee transaction bonuses, and filing and listing fees (the “Closing Cash Consideration”); and

 

  (b)

A number of shares of Class A common stock and newly issued Class A units of Fathom OpCo (the “New Fathom Units”) (together with one share of Class B common stock to be issued at par value for cash in respect of each New Fathom Units), to be allocated as set forth on the Allocation Schedule (as defined in the Business Combination Agreement), in an aggregate number (rounded up to the nearest whole share) equal to the quotient of (i) the result of (A) $1,200,000,000 minus (B) the Closing Cash Consideration divided by (ii) $10.00 (the “Closing Seller Equity Consideration”).

Earnout

In addition to the Closing Seller Equity Consideration, an aggregate of 9,000,000 additional shares or units of earnout equity consideration consisting of Fathom Class A common stock and New Fathom Units (collectively, the “Earnout Shares”) will be issued to the Continuing Fathom Unitholders (who will receive New Fathom Units together with shares of Altimar Class B Common Stock) and the Fathom Blocker Members (who will receive Fathom Class A common stock) pursuant to the terms of the Business Combination Agreement. The Earnout Shares will vest in three equal tranches of an aggregate amount of 3,000,000 shares of Fathom Class A common stock or New Fathom Units, as applicable, with each tranche vesting at each of the following share price thresholds: $12.50, $15.00 and $20.00, in each case subject to the vesting and forfeiture provisions set forth in the Investor Rights Agreement and the Fathom Operating Agreement. The earnout period will be five years from the date of the closing of the Business Combination. The achievement of the price threshold will be determined based on the volume-weighted average share price for 20 trading days within any 30-trading day period or a change of control transaction of Fathom that implies the same per share valuation as the applicable price threshold.

Representations and Warranties

In General

The parties to the Business Combination Agreement have made customary representations, warranties and covenants in the Business Combination Agreement, including, among others, covenants with respect to the conduct of Altimar II, Fathom OpCo and the Fathom Blockers and their respective applicable businesses prior to the Closing. Each of Altimar II and Fathom OpCo has agreed to cooperate and use commercially reasonable efforts to cause the Business Combination to be consummated.

 

104


Table of Contents

In addition, Fathom OpCo will have the option to elect to repay, refinance or obtain debt financing up to an aggregate amount of $175,000,000, which election will be made in consultation with Altimar II.

Sponsor also agreed to fund certain transaction expenses of Altimar II which exceed the $27,000,000 cap set forth in Section 4.03(b) of the Business Combination Agreement (other than transaction expenses in respect of (i) 50% of transfer taxes, (ii) fees and expenses of certain advisors that are, or have been, retained at the request of Fathom OpCo or (iii) printer, transfer agent and proxy solicitation fees which exceed $1,300,000, when taken together, or $27,000,000, when combined with up to $25,700,000 of the aggregate amounts of other transaction expenses of Altimar II, which excess will not be borne by Sponsor).

Material Adverse Effect

Material Adverse Effect with respect to Fathom Business

Under the Business Combination Agreement, with respect to Fathom OpCo, a “Material Adverse Effect” means an event, change, circumstance, occurrence, fact, development or effect, individually or in the aggregate, that would reasonably be expected to (x) be materially adverse to the business, assets, properties, results of operations or condition (financial or otherwise) of Fathom OpCo and its subsidiaries, taken as a whole, or (y) the ability of Fathom OpCo to perform its obligations under the Business Combination Agreement and to consummate the Business Combination; provided, however, that in no event shall any of the following (or the effect of any of the following), alone or in combination, be deemed to constitute, or be taken into account in determining whether there has been or will be, a “Material Adverse Effect” on the results of operations or condition (financial or otherwise) of Fathom OpCo and its subsidiaries, taken as a whole: (a) any change in applicable laws or GAAP or any interpretation thereof after the date hereof, (b) any change in interest rates or economic, political, business, financial, commodity, currency or market conditions generally, (c) the announcement or the execution of the Business Combination Agreement, the pendency or consummation of the mergers contemplated thereby or the performance of the Business Combination Agreement (provided that the exceptions in this clause (c) shall not be deemed to apply to references to “Material Adverse Effect” in the representations and warranties set forth in Section 5.04 of the Business Combination Agreement and, to the extent related thereto, the condition in Section 11.02(a) of the Business Combination Agreement), (d) any change generally affecting any of the industries or markets in which Fathom OpCo or its subsidiaries operate or the economy as a whole, (e) any earthquake, hurricane, tsunami, tornado, flood, mudslide, wild fire or other natural disaster, act of God or other force majeure event, (f) any national or international political or social conditions in countries in which, or in the proximate geographic region of which, Fathom OpCo operates, including the engagement by the United States or such other countries in hostilities or the escalation thereof, whether or not pursuant to the declaration of a national emergency or war, or the occurrence or the escalation of any military or terrorist attack upon any Person or country, or any territories, possessions, or diplomatic or consular offices of the United States or such other countries or upon any United States or such other country military installation, equipment or personnel, (g) any failure of Fathom OpCo and its subsidiaries, taken as a whole, to meet any projections, forecasts or budgets; provided, that clause (g) shall not prevent or otherwise affect a determination that any change or effect underlying such failure to meet projections or forecasts has resulted in, or contributed to, or would reasonably be expected to result in or contribute to, a Material Adverse Effect (to the extent such change or effect is not otherwise excluded from this definition of Material Adverse Effect) and (h) COVID-19 or any Law, directive, pronouncement or guideline issued by a Governmental Authority that relate to, or arise out of, an epidemic, pandemic or disease outbreak (including the COVID-19 pandemic), or any change in such Law, directive, pronouncement or guideline or interpretation thereof, in each case to the extent that they have the force of law or are binding on or affecting the Person to which they purport to apply, following the Execution Date or Fathom OpCo or any of its subsidiaries’ compliance therewith; provided that in the case of clauses (a), (b), (d), (e), (f) and (h) such events, changes, circumstances, occurrences, facts, developments or effects may be taken into account to the extent (but only to the extent) that such changes have had a disproportionate impact on Fathom and its subsidiaries, taken as a whole, as compared to other industry participants.

 

105


Table of Contents

Closing of the Business Combination

The Closing will take place at 9:00 a.m. eastern time on (a) the 3rd business day after the conditions described below under the subsection entitled “Conditions to the Closing of the Business Combination Agreement” have been satisfied, or, if permissible, waived by the party entitled to the benefit of the same (other than those conditions which by their terms are required to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions) or (b) such other date and time as the parties mutually agree.

Conditions to Closing of the Business Combination Agreement

The consummation of the Business Combination is subject to various conditions. There can be no assurance as to whether or when all of the conditions will be satisfied or waived.

Conditions to Each Party’s Obligations

The Closing is subject to certain customary conditions, including, among other things: (i) the approval of the Business Combination and other matters by Altimar II’s shareholders; (ii) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and receipt of certain additional regulatory approvals; (iii) the Available Cash Amount equaling no less than $313,000,000 at the Closing; (iv) (x) fundamental representations and warranties (which includes Organization, Due Authorization, Holding Company; Ownership and Brokers’ Fees) bring down conditions to an “all material respects” standard (y) general representations and warranties bring down conditions to a “material adverse effect” standard and (z) capitalization representation bring down condition to a “de minimis” standard; (v) covenant bring down conditions to an “all material respects” standard; (vi) the absence of a material adverse effect on the respective parties; and (vii) the effectiveness of this registration statement and the listing of Altimar II Class A common stock to be issued in the Business Combination on the NYSE. To the extent permitted by law, the conditions in the Business Combination Agreement may be waived by the parties thereto.

Additional Conditions to the Obligations of Altimar II

 

  (a)

the representations and warranties of Fathom OpCo and the Fathom Blockers, in most instances disregarding qualifications relating to materiality or material adverse effect, must be true and correct as of the execution of the Business Combination Agreement and as of the Closing as though then made (or if such representations and warranties expressly relate to a specific date, such representations and warranties shall be true and correct as of such date) (i) to the extent such failure of the representations and warranties to be so true and correct, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect (as is defined in the Business Combination Agreement) or (ii) in limited cases, in all material respects;

 

  (b)

Fathom OpCo and the Fathom Blockers shall not be in material breach as of the Closing of any covenant or agreement contained in the Business Combination Agreement to be performed or complied with by each of them, as applicable, prior to the Closing;

 

  (c)

there shall not have been a Material Adverse Effect since the date of the Business Combination Agreement;

 

  (d)

Fathom OpCo shall have delivered a customary closing certificate certifying, among other things, that the conditions described in clauses (a) and (b) above have been satisfied with respect to Fathom OpCo; and (ii) each Fathom Blocker shall have delivered a customary closing certificate certifying, among other things, that the conditions described in clauses (a), (b) and (c) above have been satisfied with respect to such Fathom Blocker; and

 

  (e)

Fathom OpCo and the Fathom Blockers shall have delivered certain other certificates and documents as required by the terms of the Business Combination Agreement.

 

106


Table of Contents

Additional Conditions to the Obligations of Fathom OpCo

The obligation of Fathom OpCo to complete the Business Combination is also subject to the satisfaction or written waiver of the following conditions:

 

  (a)

the representations and warranties of Altimar II, in most instances disregarding qualifications relating to materiality or material adverse effect, must be true and correct as of the execution of the Business Combination Agreement and as of the Closing as though then made (or if such representations and warranties expressly relate to a specific date, such representations and warranties shall be true and correct as of such date) (i) to the extent such failure of the representations and warranties to be so true and correct, individually or in the aggregate, has not had and would not reasonably be expected to have a material adverse effect on Altimar II or prevent or materially delay or impair the ability of Altimar II to perform its obligations under the Business Combination Agreement or to consummate the transactions contemplated thereby, or (ii) in limited cases, in all material respects;

 

  (b)

Altimar II shall not be in material breach as of the Closing of any covenant or agreement contained in the Business Combination Agreement to be performed or complied with by it prior to the Closing;

 

  (c)

the Available Cash Amount shall not be less than $313,000,000;

 

  (d)

Altimar II shall have delivered a customary closing certificate certifying, among other things, that the conditions described in clauses (a), (b) and (c) above have been satisfied with respect to Altimar II;

 

  (e)

Each of the covenants of each of the parties to the Forfeiture and Support Agreement (as defined below) required under the Forfeiture and Support Agreement to be performed as of or prior to the Closing shall have been performed in all material respects, and the Forfeiture and Support Agreement shall be in full force and effect;

 

  (f)

Altimar II shall have delivered certain other certificates and documents as required by the terms of the Business Combination Agreement; and

 

  (g)

The board of directors of Altimar II shall be constituted with the Persons designated in accordance with Section 11.09 of the Business Combination Agreement.

Covenants Relating to the Conduct of Business; Interim Operations Pending the Closing

Interim Operations of Altimar II

Under the Business Combination Agreement, Altimar II has made certain covenants with respect to the period from the date of the Business Combination Agreement until the earlier of the Closing or the date the Business Combination Agreement is terminated in accordance with its terms (such period, the “Pre-Closing Period”), including, among others, not to, in each case, without the prior written consent of Fathom OpCo and subject to specified or otherwise scheduled exceptions:

 

  (a)

change, modify or amend the Trust Agreement or the governing documents of Altimar II;

 

  (b)

other than in connection with the Domestication, any redemption by the stockholders of Altimar II or as otherwise required in order to consummate the Business Combination, (A) declare, make or pay any dividend, other distribution or return of capital (whether in cash or in kind), (B) split, combine or reclassify any capital stock of, or other equity interests in, Altimar II; or (C) repurchase, redeem or otherwise acquire, or offer to repurchase, redeem or otherwise acquire, any capital stock of, or other equity interests in, Altimar II;

 

  (c)

take any action, or knowingly fail to take any action, which action or failure to act would reasonably be expected to prevent, impair or impede the Business Combination from qualifying for the tax treatment intended by the Business Combination Agreement;

 

 

107


Table of Contents
  (d)

make, revoke or change any material tax election, adopt or change any annual tax accounting period or any material accounting method with respect to taxes, file any amended material tax return, settle, compromise or abandon any claim, investigation, audit or controversy relating to a material tax liability, enter into any closing agreement with respect to any material amount of taxes, surrender any right to claim a material refund of taxes or consent to any extension or waiver of the limitations period applicable to any material tax claim or assessment, or enter into any tax sharing or similar agreement (excluding any commercial contract not primarily related to taxes);

 

  (e)

(A) enter into, renew or amend in any material respect, any transaction or contract relating to certain transaction expenses if such entry, renewal or amendment would result in additional transaction expenses that, individually or in the aggregate, exceed $5,000,000, (B) cause or permit certain types of transaction expenses to be incurred if Altimar II’s aggregate transaction expenses are in excess of $27,000,000 (subject to certain exceptions), or (C) incur certain types of material transaction expenses without the prior written consent of Fathom OpCo (not to be unreasonably withheld);

 

  (f)

waive, release, compromise, settle or satisfy any pending or threatened material claim (which shall include, but not be limited to, any pending or threatened legal action) or compromise or settle any liability;

 

  (g)

except as contemplated by the 2021 Omnibus Plan, enter into any employment contract or collective bargaining agreement, pay any special bonus or special remuneration to any director, officer, employee or contractor, or increase the salaries or wage rates or fringe benefits (including rights to severance or indemnification) of its directors, officers, employees or independent contractors;

 

  (h)

acquire by merging or consolidating with, or by purchasing the assets of, or by any other manner, any business or division thereof or otherwise acquire any assets;

 

  (i)

adopt a plan of complete or partial liquidation, dissolution, merger, division transaction, consolidation or recapitalization;

 

  (j)

incur, guarantee or otherwise become liable for (whether directly, contingently or otherwise) any indebtedness;

 

  (k)

(A) offer, issue, deliver, grant or sell, or authorize or propose to offer, issue, deliver, grant or sell, any capital stock of, other equity interests, equity equivalents, stock appreciation rights, phantom stock ownership interests or similar rights in, Altimar II or any of its subsidiaries or any securities convertible into, or any rights, warrants or options to acquire, any such capital stock or equity interests, other than the issuance of Altimar II Class A common stock in connection with the PIPE Investment as contemplated in the Business Combination Agreement or (B) amend, modify or waive any of the terms or rights set forth in any warrant, including any amendment, modification or reduction of the warrant price set forth therein;

 

  (l)

authorize any of, or commit or agree to take, whether in writing or otherwise, any of, the foregoing actions; or

 

  (m)

except in respect of certain transaction expenses, voluntarily incur any liabilities in excess of $100,000 individually or $500,000 in the aggregate without the prior written consent of Fathom OpCo.

Interim Operations of Fathom OpCo

Under the Business Combination Agreement, Fathom OpCo and each Fathom Blocker, as applicable, has made certain covenants with respect to the Pre-Closing Period, including, among others, not to, in each case, without the prior written consent of Altimar II and subject to specified or otherwise scheduled exceptions:

 

  (a)

change, modify or amend the Trust Agreement or the governing documents of Altimar II;

 

 

108


Table of Contents
  (b)

other than in connection with the Domestication, any redemption by the stockholders of Altimar II or as otherwise required in order to consummate the Business Combination, (A) declare, make or pay any dividend, other distribution or return of capital (whether in cash or in kind), (B) split, combine or reclassify any capital stock of, or other equity interests in, Altimar II; or (C) repurchase, redeem or otherwise acquire, or offer to repurchase, redeem or otherwise acquire, any capital stock of, or other equity interests in, Altimar II;

 

  (c)

take any action, or knowingly fail to take any action, which action or failure to act would reasonably be expected to prevent, impair or impede the Business Combination from qualifying for the tax treatment intended by the Business Combination Agreement;

 

  (d)

make, revoke or change any material tax election, adopt or change any annual tax accounting period or any material accounting method with respect to taxes, file any amended material tax return, settle, compromise or abandon any claim, investigation, audit or controversy relating to a material tax liability, enter into any closing agreement with respect to any material amount of taxes, surrender any right to claim a material refund of taxes or consent to any extension or waiver of the limitations period applicable to any material tax claim or assessment, or enter into any tax sharing or similar agreement (excluding any commercial contract not primarily related to taxes);

 

  (e)

(A) enter into, renew or amend in any material respect, any transaction or contract relating to certain transaction expenses if such entry, renewal or amendment would result in additional transaction expenses that, individually or in the aggregate, exceed $5,000,000, (B) cause or permit certain types of transaction expenses to be incurred if Altimar II’s aggregate transaction expenses are in excess of $27,000,000 (subject to certain exceptions), or (C) incur certain types of material transaction expenses without the prior written consent of Fathom OpCo (not to be unreasonably withheld);

 

  (f)

waive, release, compromise, settle or satisfy any pending or threatened material claim (which shall include, but not be limited to, any pending or threatened legal action) or compromise or settle any liability;

 

  (g)

except as contemplated by the 2021 Omnibus Plan, enter into any employment contract or collective bargaining agreement, pay any special bonus or special remuneration to any director, officer, employee or contractor, or increase the salaries or wage rates or fringe benefits (including rights to severance or indemnification) of its directors, officers, employees or independent contractors;

 

  (h)

acquire by merging or consolidating with, or by purchasing the assets of, or by any other manner, any business or division thereof or otherwise acquire any assets;

 

  (i)

adopt a plan of complete or partial liquidation, dissolution, merger, division transaction, consolidation or recapitalization;

 

  (j)

incur, guarantee or otherwise become liable for (whether directly, contingently or otherwise) any indebtedness;

 

  (k)

(A) offer, issue, deliver, grant or sell, or authorize or propose to offer, issue, deliver, grant or sell, any capital stock of, other equity interests, equity equivalents, stock appreciation rights, phantom stock ownership interests or similar rights in, Altimar II or any of its subsidiaries or any securities convertible into, or any rights, warrants or options to acquire, any such capital stock or equity interests, other than the issuance of Altimar Class A Common Stock in connection with the PIPE Investment as contemplated in the Business Combination Agreement or (B) amend, modify or waive any of the terms or rights set forth in any warrant, including any amendment, modification or reduction of the warrant price set forth therein;

 

  (l)

authorize any of, or commit or agree to take, whether in writing or otherwise, any of, the foregoing actions; or

 

  (m)

except in respect of certain transaction expenses, voluntarily incur any liabilities in excess of $100,000 individually or $500,000 in the aggregate without the prior written consent of Fathom OpCo.

 

109


Table of Contents

Additional Covenants

Trust Account

Subject to the satisfaction or waiver of certain conditions set forth in the Business Combination Agreement and provision of notice thereof to the trustee of Altimar II’s Trust Account, at the Closing, Altimar II will (i) cause the documents, opinions and notices required to be delivered to the trustee pursuant to the Trust Agreement to be so delivered, and (ii) cause the trustee to pay as and when due (x) all amounts payable to Altimar II’s stockholders who shall have validly elected to redeem their Class A common shares pursuant to Altimar II’s Amended and Restated Memorandum and Articles of Association and (y) all amounts payable pursuant to the Business Combination Agreement.

Certain Regulatory Approvals

The parties will use their commercially reasonable efforts to promptly file all notices, reports and other documents required to be filed by such party with any governmental authority with respect to the Business Combination, and to submit promptly any additional information requested by any such governmental authority. The parties will use their commercially reasonable efforts to promptly obtain all authorizations, approvals, clearances, consents, actions or non-actions of any governmental authority in connection with the applicable filings, applications or notifications. Each party will promptly inform the other parties of any material communication between itself or its representatives and any governmental authority regarding the Business Combination. If a party or any of its affiliates receives any request for supplemental information or documentary material from any governmental authority with respect to the Business Combination, then the party, to the extent necessary and advisable, shall provide a reasonable response to such request as promptly as reasonably practicable.

The consummation of the Business Combination will specifically require the approval from certain governmental authorities, including the United States Federal Trade Commission and/or Department of Justice under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder. The approvals contemplated by the preceding sentence are conditions to the Closing of the Business Combination.

Termination

The Business Combination Agreement may be terminated by Altimar II and Fathom OpCo under certain circumstances, including, among others, (i) by mutual written consent of Fathom OpCo and Altimar II, (ii) (A) by Fathom OpCo or Altimar II by written notice to such other party if any applicable law is in effect making the consummation of the transactions contemplated by the Business Combination Agreement illegal or any final, non-appealable order is in effect permanently preventing the consummation of the transactions contemplated by the Business Combination Agreement; (B) by Fathom OpCo or Altimar II by written notice to such other parties if the Closing has not occurred on or before December 31, 2021 (the “Outside Date”); or (C) by Fathom OpCo or Altimar II for material uncured breach by other parties to the Business Combination Agreement (subject to notice and an opportunity to cure, if curable); provided that the right to terminate the Business Combination Agreement under this clause (iii) is not available to any party that has materially breached any of its representations, warranties, covenants or agreements and such material breach is the primary cause of or has primarily resulted in the failure of the Business Combination to be consummated on or before such date; (iii) by Fathom OpCo if the board of directors of Altimar II changes its recommendation to the Altimar II stockholders or if Altimar II fails to include the recommendation of the board of directors of Altimar II in the consent solicitation statement distributed to the Fathom members; and (iv) by Fathom OpCo or Altimar II if Altimar II does not obtain the required approval of its shareholders at the special meeting.

 

110


Table of Contents

Indemnification

The representations and warranties made by each of the parties to the Business Combination Agreement do not survive the Closing, and there is no associated indemnification from any party for a breach of any of its representations and warranties. The foregoing does not limit the remedies of the parties to the Business Combination Agreement for knowing and intentional fraud in the making of representations and warranties in the Business Combination Agreement.

The covenants and agreements made by each of the parties that are to be performed prior to or at the Closing do not survive the Closing, and there is no associated indemnification from any party for a breach of any of such covenants or agreements. The covenants and agreements made by each of the parties that are to be performed following the Closing survive the Closing in accordance with their terms, until fully performed. While there is no associated indemnification for breaches of such covenants, each party retains all rights and remedies available at law or in equity for any such breach, including specific performance.

Fees and Expenses

If the Closing occurs, Altimar II is responsible for all of the parties’ respective transaction expenses in connection with the consummation of the Business Combination, including brokers’ or finders’ fees, deferred financing fees, fees and expenses of legal counsel, financial advisors, accountants and other professional advisors, and all costs and expenses payable to third parties that are triggered or become due or payable as a result of the Business Combination. There is no adjustment to any party’s aggregate consideration as a result of transaction expenses, including if such transaction expenses exceed any budgeted amount; however, the aggregate cash consideration is subject to reduction (with corresponding increases to the applicable equity considerations) in certain circumstances where the Available Cash Consideration Amount is less than $318,000,000.

Amendment

The Business Combination Agreement may only be amended, modified or supplemented by the written agreement of all of the parties.

Governing Law; Jurisdiction

The Business Combination Agreement is governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the law of any jurisdiction other than the State of Delaware.

Certain Engagements in Connection with the Business Combination and Related Transactions

Credit Suisse Securities (USA) LLC is acting as financial advisor to Altimar II; each of J.P. Morgan Securities LLC (“J.P. Morgan”)’s Equity Capital Markets Group and Stifel, Nicolaus & Company, Incorporated (“Stifel”) is acting as Altimar II’s joint placement agent in connection with the PIPE Investment; J.P. Morgan’s Equity Capital Markets Group and Stifel are acting as capital markets advisors to Altimar II. BofA Securities, Needham & Company, LLC and Craig-Hallum Capital Group LLC are also acting as capital markets advisors to Altimar II.

 

111


Table of Contents

Related Agreements

Subscription Agreements

In connection with entering into the Business Combination Agreement, Altimar II and Fathom OpCo entered into the Subscription Agreements with the PIPE Investors, pursuant to which, among other things, the PIPE Investors party thereto agreed to consummate the PIPE Investment. The Subscription Agreements contain customary representations, warranties, covenants and agreements of Altimar II, Fathom OpCo and the PIPE Investors, and are subject to customary closing conditions (including, without limitation, that there is no amendment or modification to the Business Combination Agreement that is material and adverse to the PIPE Investor) and termination rights (including a termination right if the transaction contemplated by the Subscription Agreement has not been consummated by December 31, 2021, other than as a result of breach by the terminating party).

Forfeiture and Support Agreement

In connection with our initial public offering, on February 4, 2021, Sponsor and our officers and directors at the time of our initial public offering entered into a letter agreement (the “IPO Letter Agreement”) pursuant to which they agreed, among other things, to vote their Class B ordinary shares purchased prior to our initial public offering (“founder shares”), as well as any Class A ordinary shares sold by us in our initial public offering (“public shares”) purchased by them during or after our initial public offering, in favor of Altimar II’s initial business combination (including the proposal recommended by Altimar II’s board of directors in connection with such business combination). Accordingly, we expect them to vote their shares in favor of all proposals being presented at the Special Meeting. In addition, pursuant to the Forfeiture and Support Agreement, dated July 15, 2021 (as amended from time to time, the “Forfeiture and Support Agreement”), the parties, agreed, among other things, effective upon the Closing that, (a) Sponsor, on behalf of itself and the other Altimar II Founders, will waive the anti-dilution adjustments set forth in Altimar II’s existing Memorandum and Articles of Association and which will be set forth in Altimar II’s Certificate of Incorporation in connection with the Business Combination, (b) the Altimar II Founders will forfeit and surrender for no additional consideration the Forfeited Shares (as defined herein) which would be received upon the automatic conversion of their shares of Class C common stock upon the Closing and (c) Sponsor, from the date of the Business Combination Agreement until the earlier of Closing or the termination of the Business Combination Agreement in accordance with its terms, will refrain from taking (and not cause Altimar II to take) any action the effect of which would be to cause Altimar II to breach its non-solicitation obligations set forth in Section 9.08 of the Business Combination Agreement. In addition, the Altimar II Founders agreed, among other things, (i) from the date of the Business Combination Agreement until the earlier of the Closing or the termination of the Business Combination Agreement in accordance with its terms, to not redeem any Class A ordinary shares (or, if applicable, shares of Altimar II Class A common stock) held by them and (ii) prior to the consummation of Business Combination or the termination of the Business Combination Agreement, to vote or cause to be voted, all of the Altimar II shares beneficially owned by the Altimar II Founders, at every meeting of the shareholders of Altimar II at which such matters are considered and at every adjournment or postponement thereof: (1) in favor of (A) the Business Combination and the Business Combination Agreement and the other transactions contemplated thereby (including any proposals recommended by Altimar II’s Board of Directors in connection with the Business Combination) and (B) any proposal to adjourn or postpone such meeting of shareholders to a later date if there are not sufficient votes to approve the Business Combination; (2) against any action, proposal, transaction or agreement that could reasonably be expected to result in a breach of any covenant, representation or warranty or any other obligation or agreement of Altimar II under the Business Combination Agreement; and (3) against (A) any proposal or offer from any person concerning (I) a merger, consolidation, liquidation, recapitalization, share exchange or other business combination transaction involving Altimar II, or (II) the issuance or acquisition of shares of capital stock or other Altimar II equity securities (other than as contemplated or permitted by the Business Combination Agreement); and (B) any action, proposal, transaction or agreement that would reasonably be expected to (x) impede the fulfillment of Altimar II’s conditions under the Business Combination Agreement or change in any manner the voting rights of any class of Altimar II’s shares or (y) result in a breach of any

 

112


Table of Contents

covenant, representation or warranty or other obligation or agreement of Sponsor or any of the other Altimar II Founders contained in the Forfeiture and Support Agreement.

As described above, the Forfeited Shares to be forfeited by the Altimar II Founders shall be determined as follows: effective upon and subject to the closing of the Business Combination, (i) if the quotient of (A) the number of Altimar II Class A ordinary shares redeemed in the Altimar II Stock Redemption divided by (B) 34,500,000 (the “Altimar II Stockholder Redemption Ratio”) is less than or equal to 0.10, each then issued and outstanding share of Class C common stock will convert automatically, on a one-for-one basis, into a share of Class A common stock; (ii) if the Altimar II Stockholder Redemption Ratio is greater than 0.10 and less than to 0.40, the number of shares of Class A common stock obtained by multiplying the Redemption Forfeiture Ratio (which is obtained by the following formula: 0.15 multiplied by the quotient of (1) the result of (x) the Altimar II Stockholder Redemption Ratio minus (y) 0.10, divided by (2) 0.30) by the aggregate number of then issued and outstanding shares of Altimar Class C common stock shall be automatically forfeited and (iii) if the Altimar II Stockholder Redemption Ratio is greater than or equal to 0.40, the number of shares of Class A common stock obtained by multiplying 0.15 by the aggregate number of then issued and outstanding shares of Class C common stock will be automatically forfeited.

In addition, Sponsor and each of the other Altimar II Founders, in their capacity as holders of Altimar II Class B ordinary shares, have also agreed (a) not to, prior to the consummation of Business Combination or the termination of the Business Combination Agreement, transfer any of the their Class B ordinary shares (or shares of Class C common stock received in the Domestication), and in the case of Sponsor, its warrants to acquire Altimar II Class A ordinary shares, except to certain permitted transferees that agree to be bound by the terms of the Forfeiture and Support Agreement and (b) for the period beginning on the Closing Date and ending on the earlier to occur of (i) the one (1)-year anniversary of the Closing Date and (ii) the last day of the Qualifying Period (as defined below), if the VWAP of the Class A common stock equals or exceeds $12.00 per share for any twenty (20) Trading Days (as defined in the Forfeiture and Support Agreement) within a period of thirty (30) consecutive Trading Days commencing at least 150 days after the Closing Date (the “Qualifying Period”), not to transfer any of such Sponsor’s or other Altimar II Founder’s Altimar ordinary shares or Altimar common stock (other than in the case of the Sponsor, shares of Class A common stock acquired pursuant to the PIPE Investment).

Under the terms of the Forfeiture and Support Agreement, Sponsor agreed that, from and after the Closing, 1,267,500 Altimar II Class B ordinary shares (or, following the Domestication, shares of Class C common stock or Class A common stock, as applicable) held by Sponsor (other than any shares of Altimar II common stock issued to Sponsor pursuant to the PIPE Investment) (the “Sponsor Earnout Shares”) will be unvested and restricted and that such shares will vest automatically if (a) the VWAP of the Altimar II Class A common stock equals or exceeds $15.00 per share for any twenty (20) trading days within a period of thirty (30) consecutive trading days and (b) there is a change of control of Altimar II, unless the per share consideration to be received by the holders of Class A common stock in such change of control transaction is less than the vesting threshold applicable to the Sponsor Earnout Shares (each of (a) and (b), a “Vesting Event”). To the extent that, on or prior to the fifth (5th) anniversary of the Closing Date, a Vesting Event did not occur, all outstanding unvested Sponsor Earnout Shares will automatically be forfeited.

Sponsor also agreed to, at the Closing and subject to the terms and conditions of the Business Combination Agreement, provide funds to Altimar II to satisfy the funding of certain transaction expenses, after utilizing the unused portion of the working capital amount funded by Sponsor to Altimar II prior to the execution of the Business Combination Agreement, that are in excess of the aggregate $27,000,000 cap referenced in Section 4.03(b) of the Business Combination Agreement. All obligations of Altimar II to Sponsor for borrowed money or any payments made to or on behalf of Altimar II will be settled in cash and not through the issuance of warrants or other equity securities of Altimar II.

 

113


Table of Contents

Fathom Voting and Support Agreements

Concurrently with the execution of the Business Combination Agreement, on July 15, 2021, Altimar II and Rapid Merger Sub, on the one hand, and various direct and indirect holders of equity in Fathom OpCo, including the CORE Investors (collectively, the “Fathom Holders”), on the other hand, each entered into a Voting and Support Agreement (collectively, the “Voting and Support Agreements”), pursuant to which each such Fathom Holder agreed to, among other things, (i) vote in favor of (or consent to) the Business Combination Agreement and the transactions contemplated thereby and (ii) be bound by certain other covenants and agreements related to the Business Combination.

Tax Receivable Agreement

In connection with the Closing, Fathom will enter into a tax receivable agreement (the “Tax Receivable Agreement”), by and among Fathom, Fathom OpCo, each of the Exchange TRA Parties (as defined in the Tax Receivable Agreement) party thereto, each of the Blocker TRA Parties (as defined in the Tax Receivable Agreement) party thereto and CORE Industrial Partners Management LP, in its capacity as TRA Party Representative. Pursuant to the Tax Receivable Agreement, Fathom will be required to pay 85% of certain tax benefits, if any, that it realizes (or in certain cases is deemed to realize) as a result of tax basis in certain assets and other tax attributes of Fathom at the time of the Business Combination, any increases in tax basis and other tax benefits related to the payment of cash consideration pursuant to the Business Combination Agreement and any increases in tax basis and other tax benefits resulting from any exchange of New Fathom Units for shares of Class A common stock or cash in the future.

Fathom’s obligations under the Tax Receivable Agreement accelerate upon a change in control and certain other termination events, as defined therein.

Investor Rights Agreement

Upon the completion of the Business Combination, Fathom will enter into an investor rights agreement (the “Investor Rights Agreement”) with CORE Industrial Partners Fund I, L.P., CORE Industrial Partners Fund I Parallel, L.P. (together, the “CORE Investors”), and certain equityholders of Fathom and/or Fathom OpCo named therein. The Investor Rights Agreement provides for an initial eleven-person board of directors, consisting of ten individuals to be designated by the CORE Investors, which initially will include George Buckley, Carey Chen, TJ Chung (Chair), Caralynn Collens, David Fisher, Maria Green, Peter Leemputte, Ryan Martin, John May and Robert Nardelli, and one independent director to be mutually agreed by the CORE Investors and Sponsor. The CORE Investors have certain continued nomination rights for a number of directors ranging from the majority of the board of directors to one director, while they beneficially own shares of common stock in excess of certain ownership percentage of the amount owned by the CORE Investors at Closing, as determined in accordance with the Investor Rights Agreement. In particular, from and after the Closing Date, the CORE Investors shall have the right, but not the obligation, to nominate to the Fathom board a number of designees equal to at least: (i) a majority of the board’s seats, so long as the CORE Investors beneficially own shares of common stock representing at least 50% of the total shares of Fathom common stock beneficially owned by the CORE Investors immediately after the Closing (the “Original Amount”), (ii) 35% of the board’s seats, in the event that the CORE Investors beneficially own shares of common stock representing at least 20% but less than 35% of the Original Amount, (iii) 20% of the board’s seats, in the event that the CORE Investors beneficially own shares of common stock representing at least 10% but less than 20% of the Original Amount and (iv) one director, in the event that the CORE Investors beneficially own shares of common stock representing at least 5% of the Original Amount. For purposes of calculating the number of directors that the CORE Investors are entitled to designate pursuant to the immediately preceding sentence, any fractional amounts shall automatically be rounded up to the nearest whole number (e.g., 11/4 directors shall equate to 2 directors) and any such calculations shall be made after taking into account any increase in the size of the board. In addition, for so long as the CORE Investors beneficially own shares of common stock representing at least 5% of the Original Amount, CORE Investors will have the right to designate a person to attend meetings of the board (including any meetings of any committees thereof) in a non-voting observer capacity.

 

114


Table of Contents

The parties to the Investor Rights Agreement will agree (subject to exceptions for permitted transfers) to a contractual lock-up on the sale of Class A common stock for the period beginning on the Closing Date and ending one hundred eighty (180) days thereafter (the “Lock-Up Period”).

In addition, the CORE Investors and the other parties to the Investor Rights Agreement will agree to the vesting terms of the Earnout Shares. After expiration of the Lock-Up Period, the unvested Earnout Shares will not be transferable and those already vested Earnout Shares will only be transferable to those permitted transferees under the Investor Rights Agreement. In the event that any unvested Earnout Shares have not vested on or prior to the fifth (5th) anniversary of the Closing Date, those Earnout Shares that have not vested will automatically be forfeited and surrendered to Fathom for no consideration.

Registration Rights Agreement

Upon Closing, Fathom will enter into a Registration Rights Agreement. Under the terms of the Registration Rights Agreement, Fathom will grant to the Legacy Fathom Owners, including the CORE Investors, Sponsor and the other Altimar II Founders customary demand, shelf and piggyback registration rights. Fathom is required to file within thirty days of the Closing a shelf registration statement registering the public resale of the shares of common stock of Fathom held by such stockholders (“Shelf Registration Statement”), and cause the Shelf Registration Statement to be declared effective as promptly as practicable after the filing thereof and no later than the earlier of (A) 60 calendar days after the filing thereof (or, in the event the SEC reviews and has written comments to the Shelf Registration Statement, the 90th calendar day following the filing thereof) and (B) the 10th business day after the date Fathom is notified (orally or in writing, whichever is earlier) by the SEC that it will not review the Shelf Registration Statement.

Fathom Operating Agreement

On the Closing Date, Fathom OpCo, Fathom and the other members named therein will enter into the Fathom Operating Agreement. The Fathom Operating Agreement will provide for a redemption right with respect to the vested New Fathom Units, pursuant to which each vested New Fathom Units will be redeemable, subject to certain limitations, for either one share of Class A common stock, or, at Fathom’s or Fathom OpCo’s election, cash of an equivalent value, pursuant to and in accordance with the terms of the Fathom Operating Agreement.

 

115


Table of Contents

THE EXTRAORDINARY GENERAL MEETING

General

Altimar II is furnishing this proxy statement/prospectus to Altimar II’s shareholders as part of the solicitation of proxies by Altimar II’s board of directors for use at the Special Meeting to be held on                 , 2021, and at any adjournment thereof. This proxy statement/prospectus is first being furnished to Altimar II’s shareholders on or about                 , 2021 in connection with the vote on the Shareholder Proposals. This proxy statement/ prospectus provides Altimar II’s shareholders with information they need to know to be able to vote or instruct their vote to be cast at the Special Meeting.

Date, Time and Place

The Special Meeting will be held on                 , 2021, at                  a.m., Eastern Time, at                 . In light of the novel coronavirus pandemic and to support the well-being of Altimar II’s shareholders, directors and officers, Altimar II encourages you to use remote methods of attending the Special Meeting or to attend via proxy. You may attend the Special Meeting and vote your shares electronically during the Special Meeting via live webcast by visiting . You will need the meeting control number that is printed on your proxy card to enter the Special Meeting. You may also attend the meeting telephonically by dialing .

Purpose of the Special Meeting

At the Special Meeting, Altimar II is asking holders of ordinary shares to:

 

   

consider and vote upon a proposal to approve and adopt by ordinary resolution the Business Combination Agreement (a copy of which is attached to this proxy statement/prospectus as Annex C) and to approve the transactions contemplated by the Business Combination Agreement (we refer to this proposal as the “Business Combination Proposal”);

 

   

consider and vote upon a proposal to approve by special resolution, assuming the Business Combination Proposal is approved and adopted, the change of Altimar II’s jurisdiction of incorporation from the Cayman Islands to the State of Delaware by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware (we refer to this proposal as the “Domestication Proposal”);

 

   

consider and vote upon a proposal to approve by special resolution, assuming the Business Combination Proposal and the Domestication Proposal are approved and adopted, the approval of the amendment and restatement of the Memorandum and Articles of Association buy their deletion and replacement in their entirety with the Proposed Charter and the Proposed Bylaws (copies of which are attached to this proxy statement/prospectus as Annex A and Annex B, respectively) as the certificate of incorporation and bylaws of Fathom from and after the Domestication is effective (we refer to this proposal as the “Organizational Documents Proposal”);

 

   

consider and vote upon eight separate proposals (which we refer to, collectively, as the “Advisory Charter Proposals”) to approve, on a non-binding advisory basis, the following material differences between the current amended and restated memorandum and articles of association of Altimar II and the Proposed Charter and Proposed Bylaws of Fathom:

 

   

to increase the authorized share capital from 555,000,000 shares divided into 500,000,000 Class A ordinary shares, par value $0.0001 per share (“Class A ordinary shares”), 50,000,000 Class B ordinary shares, par value $0.0001 per share (“Class B ordinary shares”), and 5,000,000 preferred shares, par value $0.0001 per share (“preferred shares”), to authorized capital stock of .. shares, consisting of (i) .. shares of Class A common stock, par value $0.0001 per share (“Class A common stock”), (ii) shares of Class B common stock, par value $0.0001 per share (“Class B common stock”), (iii) shares of Class C common stock, par value $0.0001 per share (“Class C common stock” and together with the Class A common stock and the Class B common stock, the “common stock”) and (iv) 50,000,000 shares of preferred stock;

 

116


Table of Contents
   

to provide that the Proposed Charter may be amended, altered, repealed or adopted by (i) in the case of Articles 5, 6,7, 10 and 11 of the Proposed Charter, the affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of all the then outstanding shares of stock entitled to vote, voting together as a single class, at a meeting of the stockholders of Fathom called for that purpose and (ii) in the case of Article 9 of the Proposed Charter, the affirmative vote of the holders of at least eighty percent (80%) of all the then outstanding shares of stock entitled to vote, voting together as a single class, at a meeting of the stockholders of Fathom called for that purpose;

 

   

to provide for (i) the election of directors by a plurality of the votes cast in respect of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors, (ii) the filling of newly-created directorships or any vacancy on the board of directors by a majority vote of the remaining directors then in office, even if less than a quorum, or by a sole remaining director and (iii) the removal of directors only for cause and only upon (a) prior to the first date on which CORE and its Affiliated Companies (each as defined in the Proposed Charter) first cease to own at least 50% of the Original Amount (as defined in the Investor Rights Agreement), the affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of all the then outstanding shares of stock entitled to vote generally in the election of directors, voting together as a single class and (b) after the first date on which CORE and its Affiliated Companies cease to own at least 50% of the Original Amount, the affirmative vote of the holders of at least a majority of the total voting power of all the then outstanding shares of stock entitled to vote;