PROOF Acquisition Corp I (PACI) Merger With Volato (Private)

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August 4, 2023

  • PROOF Acquisition Corp I (PACI) to acquire Volato (Private) in a transaction valuing the pro forma entity at $261 million in Enterprise Value ($299 million equity value) assuming 100% redemptions from the current level of 76% and $30.0 million equity financing which will be raised through additional preferred financing round and also includes $10 million raised on July 10, 2023, through preferred financing round.
  • Volato shareholders will receive an equity consideration of $190 million at $10.0 per share. In addition to base purchase price, they will also receive the sum of the aggregate exercise prices of all vested Volato Options and the aggregate amount of any Volato private equity financing of up to $60 million.  
  • Sponsor agrees to use up to 50% of the Founder Shares (or *3.22 million shares) to satisfy minimum cash condition.
  • Minimum net cash condition of $35.0 million.
  • No termination fees.
  • Business combination transaction is targeted to close in 2023.
  • SPAC Details:
    • Unit Structure: 1 share of Class A Common Stock + 0.5 Redeemable Warrant
    • #Cash in Trust: $68,132,529 (105.7 % of Public Offering, including $0.48 million of extension deposit)
    • Public Shares Outstanding: 6,443,098 shares
    • Private Shares Outstanding: 6,900,000 shares
    • Trust Value/Share: $10.57
    • Current Liquidation Date: September 3, 2023
    • Outside Liquidation Date: December 3, 2023
Redemption Rate100% from current level of 76.7%
Share Price$10.0 per share
Enterprise Value$261 million
Market Cap Value$299 million
  • Target Shareholders Receive (~64%):
    • Equity consideration of $190 million at $10.0 per share (19 million Volato Group Class A Common Stock)
    • Additionally, they will also receive shares based on the following:
      • (Aggregate Exercise Price + Aggregate Additional Series A-1 Investment Amount up to $60.0 million) / $10.0
  • PIPE / Financing:
    • Volato raised $10.0 million on July 10, 2023, by issuing Series-A Preferred Shares to Sponsor (PROOF.vc)
    • Expects to raise $30.0 million to $60.0 million through additional preferred financing round
  • Redemption Protections:
    • Nil
  • Support Agreement:
    • Standard voting support
    • Sponsor agreed to use up to 50% of the Founder Shares (or *3.22 million shares) to satisfy the minimum cash condition
  • Lock-Up:
    • SPAC Sponsor: 1-year post-closing
      • Early Release: If the price equals or exceeds $12.0 per share after 150 days post-closing
    • Key Target shareholders (Holdings > 0.25 million shares): 180 days post-closing
  • Closing Conditions:
    • Termination date: December 1, 2023
    • Minimum net cash condition of $35 million
      • Cash includes:
Cash in Trust
Less:Redemptions
Less:Unpaid PACI Expenses
Add:Amounts received by the Company for the purchase of Company Series A-1 Preferred Stock
Add:PIPE Investment (excluding amounts received by the Company for the purchase of Company Series A-1 Preferred Stock)
  • Approval of PACI’s shareholders to extend deadline by December 3, 2023
    • PACI Dissenting shares ≤ 5%
  • Other customary closing conditions
  • Termination:
    • No termination fees
    • Other standard termination clauses
  • Advisors:
    • SPAC Legal Advisors: Steptoe & Johnson
    • Target Legal Advisors: Womble Bond & Dickinson
    • Target Financial Advisor: BTIG, LLC
  • Equity Incentive Plan:
    • Share reserve of 20% of fully diluted outstanding shares post-closing

*Denotes estimated figures by CPC

#Reported as on 24th May 2023 (Extension Meeting Results)