Palladyne Ai Corp. · NASDAQ:PDYN
Palladyne Ai — Sarcos — SPAC Merger (April 2021)
44 slides from Palladyne Ai's SPAC merger presentation, Apr 6, 2021
Slide 1: Investor Presentation April 2021
THE PREMIER HIGH - GROWTH, PURE PLAY INDUSTRIAL ROBOTICS INVESTMENT ,QYHVWRU3UHVHQWDWLRQ $SULO
Slide 2: Disclaimer
DISCLAIMER • Legal Disclaimer • This presentation is for informational purposes only to assist interested parties in making their own evaluation with respect to the potential business combination between Sarcos Corp. (“ Sarcos ”) and Rotor Acquisition Corp. (“Rotor”) (the “Potential Business Combina
Slide 3: Disclaimer
',6&/$,0(5 • The information contained herein is provided only as of the date on which this presentation is made and is subject to change. Ho wever, while Sarcos and Rotor may elect to update these forward - looking statements in the future, each of Sarcos and Rotor is not under any obligation, and
Slide 4: Disclaimer: Additional Information
DISCLAIMER • Additional Information • In connection with the Potential Business Combination, Rotor intends to file with the SEC a preliminary proxy statement (and ame ndments thereto) and mail a definitive proxy statement/prospectus relating to the Potential Business Combination to its shareholders.
Slide 5: Rotor Acquisition Corp. Overview
6$5&2635235,(7$5<$1'&21),'(17,$/ ROTOR ACQUISITION CORP. OVERVIEW 5272529(59,(: Brian Finn CEO Stefan Selig Chairman – Rotor’s investment focus is on companies operating in large and growing markets that are ripe for disruption – Key business characteristics include attractive disruptive technology,
Slide 6: Transaction Overview
6 SARCOS PROPRIETARY AND CONFIDENTIAL TRANSACTION OVERVIEW Valuation Sarcos Business Overview &DSLWDO 6WUXFWXUH 2IIHULQJ 6 L]H x A global leader in dexterous mobile robots x Revolutionizing the future of work through an advanced line of robotic products designed to augment humans x Robust revenue gr
Slide 7: Robots that augment rather than replace humans
6$5&2635235,(7$5<$1'&21),'(17,$/ Goal to multiply worker productivity and reduce employee injuries -- all for a monthly service fee equal to a single fully - burdened $25 per hour employee 6&$/$%/(1(;7 *(1(5$7,2152%27,&6$6 $ 6(59,&( 62/87,2172(032:(57+(/$%25)25&( ROBOTS THAT AUGMENT RATHER THAN REPL
Slide 8: World class leadership with expertise required to scale
8 6$5&2635235,(7$5<$1'&21),'(17,$/ WORLD CLASS LEADERSHIP WITH EXPERTISE REQUIRED TO SCALE EACH KEY LEADER HAS EXPERIENCE FROM START - UP THROUGH MULTI - BILLI ON DOLLAR COMPANIES KRISTI MARTINDALE EVP, Chief Product & Marketing Officer ‡ \HDUWHFKQRORJ\LQGXVWU\YHWHUDQ ‡ /DXQFKHGZRUOG FKDQJLQJEOHHGLQ
Slide 9: Sarcos at a Glance
9 SARCOS PROPRIETARY AND CONFIDENTIAL SARCOS AT A GLANCE UNIQUE OPPORTUNITY TO INVEST IN A HIGH - GROWTH, PURE PLAY INDUSTR IAL ROBOTICS COMPANY COMPANY OVERVIEW 352-(&7('5(9(18( ± $JOREDOOHDGHULQKLJKO\GH[WHURXVPRELOHURERWV ± 8QLTXH5RERW DV D 6HUYLFH5DD6PRGHOH[SHFWHGWRDFFHOHUDWHDGRSWLRQE\ RIIHULQJUR
Slide 10: Years of development with over $300 million invested in R&D
10 SARCOS PROPRIETARY AND CONFIDENTIAL 20 YEARS OF DEVELOPMENT WITH OVER $300 MILLION INVESTED IN R&D SARCOS EVOLUTION 2006 2007 2015 2016 2017 2019 2020 XO program begins (DARPA) 1 st XO hydraulic (DARPA) 2nd XO hydraulic (DARPA) Air Force XO contract US SOCOM XO contract Marine Corp XO contract XO
Slide 11: Significant Market Opportunity
SARCOS PROPRIETARY AND CONFIDENTIAL SIGNIFICANT MARKET OPPORTUNITY
Slide 12: Global need drives demand and creates a massive opportunity
12 SARCOS PROPRIETARY AND CONFIDENTIAL GLOBAL NEED DRIVES DEMAND AND CREATES A MASSIVE OPPORTUNITY WORKER SHORTAGE, INJURY & FATIGUE KEY DRIVERS OF OPPORTUNITY $100 billion spent annually on back injuries in the U.S. Spine Research Institute & OSHA $136 billion annual US costs in lost production due
Slide 13: $147 billion annual target market in the US alone
13 SARCOS PROPRIETARY AND CONFIDENTIAL Maintenance & repair Assembly support Ship / receive Assemble Non - cons Heavy duty Logistics Maintenance & repair Maintenance & diagnostics Construct / deconstruct Line and transformer maintenance Infrastructure inspection Build & repair Material transport Mov
Slide 14: Pioneering the Market for Dexterous Robotic Systems
SARCOS PROPRIETARY AND CONFIDENTIAL PIONEERING THE MARKET FOR DEXTEROUS ROBOTIC SYSTEMS
Slide 15: AI & automation can't address dynamic environments
15 SARCOS PROPRIETARY AND CONFIDENTIAL AI & AUTOMATION CAN’T ADDRESS DYNAMIC ENVIRONMENTS Brain Computer Processing power Highly variable Fixed Petaflops 1,000 Petaflops 54.9 Petaflops (world’s fastest single computer 2019) Operations Up to 1,000,000 trillion 93 trillion Resilience Very high Almost
Slide 16: Innovation, experience and IP enables a true blue ocean opportunity
16 SARCOS PROPRIETARY AND CONFIDENTIAL INNOVATION, EXPERIENCE AND IP ENABLES A TRUE “BLUE OCEAN” OPPORTUNITY PROPRIETARY INNOVATIONS DEEP ROBOTICS PATENT PORTFOLIO COMPETITIVE STRENGTHS Energetic Autonomy Reduced power from 6,800 to 500 watts Optimized power utilization – elastic recovery Modelled a
Slide 17: Leveraging core technologies to support a full suite of dexterous robots
17 SARCOS PROPRIETARY AND CONFIDENTIAL Portable Wireless Versatile 100% load relief Gravity compensation Power optimization Human kinematic equivalency Teleoperation Force reflection Wearable input Highly dexterous end effectors *XDUGLDQ Š 6 0RELOH,R7SODWIRUP *XDUGLDQ Š ;2 Š ,QGXVWU\ ZRUNIRUFH *XDUG
Slide 18: Guardian XO: an industry workforce multiplier
18 SARCOS PROPRIETARY AND CONFIDENTIAL *8$5',$1 Š ;2 Š ± $1,1'8675< :25.)25&( 08/7,3/,(5:,7+5('8&('5,6.62),1-85< EXPONENTIAL PRODUCTIVITY FOR THE FULLY - BURDENED COST OF A SINGLE EMPLOYEE Up to 200 lbs of lift capacity Hot - swappable batteries 100% load relief Don / doff in < 30 seconds Pricing of
Slide 19: Guardian XO exoskeleton competitive landscape
19 SARCOS PROPRIETARY AND CONFIDENTIAL *8$5',$1 Š ;2 Š $1(;26.(/(721,1$&/$662),762:1 ,1'8675,$/3$57,$/ %2'< 8132:(5(' FULL BODY POWERED REHABILITATION INDUSTRIAL PARTIAL BODY POWERED FORTIS EKSO ZERO G SAMSUNG 3$1$621,& +21'$ REWALK CYBERDYNE EKSO BIONICS
Slide 20: Leveraging XO upper body for Guardian XT
20 SARCOS PROPRIETARY AND CONFIDENTIAL /(9(5$*,1*;2 Š 833(5%2'< 6$5&26 +,*+),'(/,7< )25&()(('%$&.7(/(23(5$7,21 7(&+12/2*<)281'$7,21)25$02'8/$5+,*+/<'(;7(528652%27)25& +$//(1*,1*(19,5210(176 Power supply & management Advanced gravity compensation Sensing Quick swap end - effectors GUARDIAN ® XO ® GUA
Slide 21: Guardian XT: any base, any place
21 SARCOS PROPRIETARY AND CONFIDENTIAL *8$5',$1 Š ;7 $1<%$6($1<3/$&( Optimize productivity for precise tasks in dangerous environments Reduce at - height and overhead fatigue, Reduce injury & exposure to hazardous conditions Mitigate risks and associated costs Reduce insurance premiums & hazard pay
Slide 22: Robot-as-a-Service (RaaS) model expected to accelerate adoption
SARCOS PROPRIETARY AND CONFIDENTIAL ROBOT - AS - A - SERVICE ( RAAS ) MODEL EXPECTED TO ACCELERATE ADOPTION AND DELIVER RECURRING REVENUES RAAS INTENDED TO OFFER ECONOMIC ADVANTAGES AND A UNIQUE VALUE PR OPOSITION %(1(),762)5$$6 RAAS VS. BUY x Maintenance and servicing covered by Sarcos x Lowers bar
Slide 23: Target Customers
23 SARCOS PROPRIETARY AND CONFIDENTIAL TARGET CUSTOMERS a 81,7681'(5',6&866,215(35(6(17,1*! 0,//,21,1$118$/5(9(18(6 INDUSTRIAL LOGISTICS ( &200(5&( FOOD SERVICES 50% Domestic direct distribution vs. international distributor channel anticipated 0RQWKV $YHUDJHH[SHFWHGVDOHVF\FOH 36 Months Expected sta
Slide 24: Customer Testimonials: Case Studies
24 6$5&2635235,(7$5<$1'&21),'(17,$/ CUSTOMER TESTIMONIALS: CASE STUDIES CUSTOMER A x Relationship with Sarcos since 2015 x Contemplating if 100 to 500 units is the right order for the Guardian XO x Considers $100,000 / unit to be the correct comparative cost x Believes employees will see this as a w
Slide 25: Positioned to deliver strong financial growth
6$5&2635235,(7$5<$1'&21),'(17,$/ POSITIONED TO DELIVER STRONG FINANCIAL GROWTH
Slide 26: Asset-light approach to manufacturing
6$5&2635235,(7$5<$1'&21),'(17,$/ ASSET - LIGHT APPROACH TO MANUFACTURING $17,&,3$7('3$571(56+,3:,7+:25/' &/$66&2175$&70$18)$&785(57 2(1$%/()$67(5 5(/($6($1'6&$/$%,/,7<:,7+/(66'(3/2<('&$3,7$/ INSOURCED DEVELOPMENT OUTSOURCED PRODUCTION 3URFHVV 0DWXUDWLRQ (QDEOLQJ7UDQVIHU (QJLQHHULQJ 'HYHORSPHQW Rapid
Slide 27: Illustrative per unit economics
27 6$5&2635235,(7$5<$1'&21),'(17,$/ n Setup n Repair n Amortization ILLUSTRATIVE PER UNIT ECONOMICS (6 - YEAR SERVICE LIFE AS OF 2026) XO DX / XT REVENUE &267 &$6+)/2: n Setup n Repair n Amortization $600 Cumulative Cumulative $425 Cumulative REVENUE $360 Cumulative &267 Cumulative CASH FLOW $270 Cu
Slide 28: Financial Projections
28 SARCOS PROPRIETARY AND CONFIDENTIAL ),1$1&,$/352-(&7,216 Source: Company information. (1) Adjusted EBITDA includes XO / XT product amortization, which is recognized in cost of goods sold and excludes stock - based compensation. Please refer to the Adjusted EBITDA reconciliation in the appendix. (
Slide 29: Key Takeaways
29 SARCOS PROPRIETARY AND CONFIDENTIAL KEY TAKEAWAYS 2 3 5 6 7 3URYHQDQGH[SHULHQFHGOHDGHUVKLSWHDPZLWKH[WHQVLYHSXEOLFFRPSDQ\H[SHULHQFH Massive multi - billion - dollar global TAM across a wide range of industries looking to solve for skilled labor shortage, aging work force and gender / age discrimin
Slide 30: Transaction structure and pro forma equity ownership
30 SARCOS PROPRIETARY AND CONFIDENTIAL TRANSACTION STRUCTURE AND PRO FORMA EQUITY OWNERSHIP TRANSACTION STRUCTURE ▪ The transaction is expected to close in Q3 2021 ▪ Post - closing, the combined company will be listed on the Nasdaq, will be named “Sarcos Technology and Robotics Corporation” and will
Slide 31: Public comparable universe for Sarcos Robotics
31 SARCOS PROPRIETARY AND CONFIDENTIAL PUBLIC COMPARABLE UNIVERSE FOR SARCOS ROBOTICS Robotics & Automation 'LVUXSWLYH&DWHJRU\ &UHDWRUV Recent Hardware de - SPACs x Accessing same broad market mega trends on industrial technology Not direct competitors with Sarcos Established companies with sustaine
Slide 32: Sarcos' business model compares favorably to peers
32 SARCOS PROPRIETARY AND CONFIDENTIAL 18% 17% 16% 14% 14% 9% 9% 6% 6% 33% 17% 16% 12% 10% 208% 145% 103% 101% 94% 88% 76% 63% 41% 13% SARCOS’ BUSINESS MODEL COMPARES FAVORABLY TO PEERS YoY revenue growth Robotics & Automation 'LVUXSWLYH&DWHJRU\&UHDWRUV Recent Hardware de - SPACs Peer Average: 12% P
Slide 33: Sarcos: an attractive valuation paradigm for investors
33 6$5&2635235,(7$5<$1'&21),'(17,$/ 9.6x 5.6x 24.6x 0.7x | $1.3bn 1.7x | $1.3bn 28.6x [ 11.7x SARCOS – AN ATTRACTIVE VALUATION PARADIGM FOR INVESTORS Revenue Illustrative Discounted Enterprise Value (3) Pro Forma Enterprise Value $1.3 billion Source: Company materials, filings, and FactSet as of 3/4
Slide 34: Appendix
SARCOS PROPRIETARY AND CONFIDENTIAL APPENDIX
Slide 35: Anticipated company timeline
35 SARCOS PROPRIETARY AND CONFIDENTIAL Q2 2021 Q4 2021 Q2 2022 .(<1($57(500,/(6721(6 ANTICIPATED COMPANY TIMELINE First “Beta” proof of concept assembled for both XO and XT Re - commence “Alpha” testing / simulations with DoD and lighthouse commercial customers Low - rate initial production of comme
Slide 36: CYTAR cybernetic training for autonomous robots
36 SARCOS PROPRIETARY AND CONFIDENTIAL &<%(51(7,&75$,1,1*)25$87212028652%276 &<7$5 Π,1,7,$/%8,/',1*%/2&.6)81'('%<'2' KINEMATIC EQUIVALENT EXOSKELETON PROVIDES UNIQUE ABILITY TO GATH ER DATA DIRECTLY FROM THE HUMAN CYTAR Πtraining platform, built on Sarcos proprietary innovations, effectively and r
Slide 37: Sarcos expected to be able to tap into a multi-billion dollar TAM
37 SARCOS PROPRIETARY AND CONFIDENTIAL 6$5&26(;3(&7672%($%/(727$3,172$08/7, %,//,21 '2//$57$0 620 Total Addressable Market $146.6 Billion Serviceable Obtainable Market Assumptions 0LOOLRQ :RUNHUVLQ7DUJHW6HFWRUV 1 / 10 Jobs Utilizing XO / XT $14.7 Billion Serviceable Obtainable Market 1.7 Million Tot
Slide 38: Occupation data included in the TAM analysis
38 SARCOS PROPRIETARY AND CONFIDENTIAL OCCUPATION DATA INCLUDED IN THE TAM ANALYSIS 6RXUFH%XUHDXRI/DERU6WDWLVWLFV2FFXSDWLRQDO(PSOR\PHQW6WDWLVWLFV6XUYH\ Occupation Employees Boilermakers 15,820 Brickmasons, Blockmasons, and Stonemasons 73,040 Carpenters 734,170 Construction Laborers 1,020,350 Constru
Slide 39: US Total Addressable Market Analysis
39 SARCOS PROPRIETARY AND CONFIDENTIAL US TOTAL ADDRESSABLE MARKET ANALYSIS US Total Addressable Market Analysis (2020) Total # of Workers in Target Sectors (mm) 16.6 Number of Human Workers / Robot 10.0 Total Number of Robots Projected (mm) 1.7 Annual Cost Per Sapphire Unit ($000) $88.6 TAM Project
Slide 40: GAAP Reconciliation
40 SARCOS PROPRIETARY AND CONFIDENTIAL 121 *$$35(&21&,/,$7,21 ,10,//,216 Note: EBITDA includes amortization expense for RaaS units which is included in the respective COGS lines. Adjusted EBITDA 2020A 2021E 2022E 2023E 2024E 2025E 2026E Net Income/(Loss) ($17.9) ($51.6) ($63.8) $3.6 $126.1 $352.4 $9
Slide 41: Selected public comparable companies
41 SARCOS PROPRIETARY AND CONFIDENTIAL 6(/(&7('38%/,&&203$5$%/(&203$1,(6 Source: Factset and Company filings as of 3/4/2021. ($ in millions, except per share values) Share price as of % 52-week Equity Ent. EV / EBITDA EV / Revenue EV / EBIT Revenue growth EBITDA margin Company 3/4/21 high value valu
Slide 42: Rotor Acquisition Corp management biographies
42 SARCOS PROPRIETARY AND CONFIDENTIAL ROTOR ACQUISITION CORP MANAGEMENT BIOGRAPHIES 527250$1$*(0(17 Brian Finn – CEO 6WHIDQ6HOLJ ± &KDLUPDQ – Over 35 years of experience in the financial services industry, including roles as a Strategic Advisor at KKR, Chairman of Covr Financial Technologies, Chair
Slide 43: Summary risk factors
43 SARCOS PROPRIETARY AND CONFIDENTIAL 6800$5<5,6.)$&7256 Risks Associated with Sarcos’ Business Sarcos’ business is subject to numerous risks and uncertainties that you should consider before investing. The summary risks an d uncertainties described below are not the only ones Sarcos faces. Additio
Slide 44: Summary risk factors
44 SARCOS PROPRIETARY AND CONFIDENTIAL 6800$5<5,6.)$&7256 Risks Associated with Sarcos’ Business Sarcos’ business is subject to numerous risks and uncertainties that you should consider before investing. The summary risks an d uncertainties described below are not the only ones Sarcos faces. Additio