Delaware
|
| |
6770
|
| |
86-2707040
|
(State or other jurisdiction of
incorporation or organization)
|
| |
(Primary Standard Industrial
Classification Code Number)
|
| |
(I.R.S. Employer
Identification Number)
|
|
| |
Copies to:
|
| |
|
Scott D. Fisher
Steptoe & Johnson LLP
|
| |
Matt Liotta
Volato, Inc.
|
| |
F. Reid Avett
Womble Bond Dickinson (US) LLP
|
1114 Avenue of the Americas
|
| |
1954 Airport Road, Suite 124
|
| |
2001 K Street, NW, Ste. 400 South
|
New York, NY 10036
|
| |
Chamblee, GA 30341
|
| |
Washington, DC 20016
|
(212) 506-3900
|
| |
(904) 539-7404
|
| |
(202) 857-4425
|
Large accelerated filer
|
| |
☐
|
| |
Accelerated filer
|
| |
☐
|
Non-accelerated filer
|
| |
☒
|
| |
Smaller reporting company
|
| |
☒
|
|
| |
|
| |
Emerging growth company
|
| |
☒
|
•
|
The BCA Proposal - To consider and vote upon a proposal to approve and adopt the
Business Combination Agreement, dated as of August 1, 2023 (the “Business Combination Agreement”), among PACI, PACI Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of PACI (“Merger Sub”), and Volato, Inc., a
Georgia corporation (“Volato”), pursuant to which Merger Sub will merge with and into Volato, with Volato surviving the merger as a wholly-owned subsidiary of PACI, including the other transactions contemplated by the Business
Combination Agreement (such transaction, the “Business Combination” and such proposal, the “BCA Proposal”). A copy of the Business Combination Agreement is attached to this proxy statement/prospectus as Annex A.
|
•
|
The Stock Issuance Proposal - To consider and vote upon a proposal to approve, for
purposes of complying with applicable listing rules of the New York Stock Exchange (“NYSE”), the issuance of up to 20,354,242 shares of Class A Common Stock of PACI, par value $0.0001 per share (“Class A Common Stock”), pursuant to the
Business Combination Agreement (the “Stock Issuance Proposal”).
|
•
|
The Charter Amendment Proposal - To consider and vote upon a proposal to approve and
adopt an amended and restated certificate of incorporation of PACI (the “Proposed Charter”), which will amend, restate, and replace PACI’s Amended and Restated Certificate of Incorporation, dated November 29, 2021 (as amended, the
“Current Charter”) upon the closing of the Business Combination (the “Closing”), including the the change of the Company name to “Volato Group, Inc.” (“Volato Group”). We refer to such proposal as the “Charter Amendment Proposal”. A
copy of the Proposed Charter is attached to this proxy statement/prospectus as Annex B.
|
•
|
The Stock Incentive Plan Proposal - To consider and vote upon a proposal to approve
the 2023 Stock Incentive Plan (the “2023 Plan”), a copy of which is attached to this proxy statement/prospectus as Annex C, including the authorization of the initial share reserve under the 2023 Plan (the “Stock Incentive Plan
Proposal”).
|
•
|
The Adjournment Proposal - To consider and vote upon a proposal to approve the
adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the
approval of the BCA Proposal, the Stock Issuance Proposal, the Charter Amendment Proposal, or the Incentive Plan Proposal (such proposal to approve the adjournment of the Special Meeting, the “Adjournment Proposal” and, together with
the BCA Proposal, the Stock Issuance Proposal, the Charter Amendment Proposal, and the Incentive Plan Proposal, the “Proposals”).
|
•
|
The BCA Proposal - To consider and vote upon a proposal to approve and adopt the
Business Combination Agreement, dated as of August 1, 2023 (the “Business Combination Agreement”), among PACI, PACI Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of PACI (“Merger Sub”), and Volato, Inc., a
Georgia corporation (“Volato”), pursuant to which Merger Sub will merge with and into Volato, with Volato surviving the merger as a wholly-owned subsidiary of PACI, including the other transactions contemplated by the Business
Combination Agreement (the “Business Combination” and such proposal, the “BCA Proposal”). A copy of the Business Combination Agreement is attached to the accompanying proxy statement/prospectus as Annex A.
|
•
|
The Stock Issuance Proposal - To consider and vote upon a proposal to approve, for
purposes of complying with applicable listing rules of the New York Stock Exchange (“NYSE”), the issuance of up to 20,354,242 shares of Class A Common Stock of PACI, par value $0.0001 per share pursuant to the Business Combination
Agreement (the “Stock Issuance Proposal”).
|
•
|
The Charter Amendment Proposal - To consider and vote upon a proposal to approve
and adopt an amended and restated certificate of incorporation of PACI (the “Proposed Charter”), which will amend, restate and replace PACI’s Amended and Restated Certificate of Incorporation, dated November 29, 2021 (as amended, the
“Current Charter”) upon the closing of the Business Combination (the “Closing”), including the the change of the Company name to “Volato Group, Inc.” (“Volato Group”) (we refer to such proposal as the “Charter Amendment Proposal”). A
copy of the Proposed Charter is attached to this proxy statement/prospectus as Annex B.
|
•
|
The Stock Incentive Plan Proposal - To consider and vote upon a proposal to approve
the 2023 Stock Incentive Plan (the “2023 Plan”), a copy of which is attached to this proxy statement/prospectus as Annex C, including the authorization of the initial share reserve under the 2023 Plan (the “Stock Incentive Plan
Proposal”).
|
•
|
The Adjournment Proposal - To consider and vote upon a proposal to approve the
adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the
approval of the BCA Proposal, the Stock Issuance Proposal, the Charter Amendment Proposal, or the Stock Incentive Plan Proposal (the “Adjournment Proposal” and, together with the BCA Proposal, the Stock Issuance Proposal, the Charter
Amendment Proposal, and the Stock Incentive Plan Proposal, the “Proposals”).
|
•
|
the occurrence of any event, change, or other circumstances that could delay the Business Combination or give rise to the
termination of the Business Combination Agreement and the other agreements related to the Business Combination (including catastrophic events, acts of terrorism, the outbreak of war, and a pandemic or other public health event), as well
as management’s response to any of the foregoing;
|
•
|
the outcome of any legal proceedings that may be instituted following announcement of the Business Combination against PACI,
Volato, Inc. (“Volato”) or its subsidiaries, their respective affiliates, or their respective directors and officers;
|
•
|
the inability to complete the Business Combination due to the failure to (i) obtain approval of the stockholders of PACI, or
regulatory approvals or (ii) satisfy the other conditions to closing required by the Business Combination Agreement;
|
•
|
the risk that PACI may not be able to obtain the financing necessary to fully capitalize Volato from the date of consummation
of the Business Combination through to profitability;
|
•
|
the risk that the proposed Business Combination disrupts current plans and operations of Volato, its subsidiaries, or PACI as
a result of the announcement and consummation of the Business Combination;
|
•
|
PACI’s ability to realize the anticipated benefits of the Business Combination, which may be affected by, among other things,
competition and the ability of Volato to grow and manage growth profitably following the Business Combination;
|
•
|
risks relating to the uncertainty of the projected financial information with respect to Volato and its subsidiaries;
|
•
|
costs related to the Business Combination;
|
•
|
Volato’s success in retaining or recruiting, or changes required in, its officers, key employees, pilots, or directors
following the Business Combination;
|
•
|
the possibility of third-party claims against PACI’s Trust Account;
|
•
|
the amount of redemption requests by PACI’s stockholders;
|
•
|
changes in applicable laws or regulations;
|
•
|
the ability of Volato to execute its business model; and
|
•
|
the possibility that PACI or the post-combination company may be adversely affected by other economic, business, or
competitive factors.
|
Q:
|
Why am I receiving this proxy statement/prospectus?
|
A:
|
PACI stockholders are being asked to consider and vote upon, among other things, proposals to (a) approve and adopt the
Business Combination Agreement, pursuant to which Merger Sub will merge with and into Volato, with Volato surviving the merger as a wholly-owned subsidiary of PACI, (b) approve such merger and the other transactions contemplated by the
Business Combination Agreement, (c) approve, for purposes of complying with applicable listing rules of the NYSE, the issuance of up to 20,354,242 shares of Class A Common Stock of the Company, (d) adopt the Proposed Charter, and (e)
approve the adoption of the 2023 Plan.
|
Q:
|
What is being voted on at the Special Meeting?
|
A:
|
PACI stockholders will vote on the following proposals at the Special Meeting (“Proposals”).
|
•
|
The BCA Proposal - To consider and vote upon a proposal to approve and adopt the
Business Combination Agreement, including the transactions contemplated thereby.
|
•
|
The Stock Issuance Proposal - To consider and vote upon a proposal to approve, for
purposes of complying with applicable listing rules of the NYSE the issuance of up to 20,354,242 shares of Class A Common Stock.
|
•
|
The Charter Amendment Proposal - To consider and vote upon a proposal to approve and
adopt the Proposed Charter, which will amend, restate and replace PACI’s Current Charter and reflect the change of the Company name to “Volato Group, Inc.”
|
•
|
The Stock Incentive Plan Proposal - To consider and vote upon a proposal to approve
the 2023 Plan, including the authorization of the initial share reserve under the 2023 Plan.
|
•
|
The Adjournment Proposal - To consider and vote upon a proposal to approve the
adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the
approval of the BCA Proposal, the Stock Issuance Proposal, the Charter Amendment Proposal, or the Stock Incentive Plan Proposal.
|
Q:
|
Are the Proposals conditioned on one another?
|
A:
|
We may not consummate the Business Combination unless the BCA Proposal, the Stock Issuance Proposal, the Charter Amendment
Proposal, and the Stock Incentive Plan Proposal are each approved at the Special Meeting. The Stock Issuance Proposal, the Charter Amendment Proposal, and the Stock Incentive Plan Proposal are conditioned on the approval of the BCA
Proposal. The Adjournment Proposal is not conditioned on the approval of any other Proposal set forth in this proxy statement/prospectus.
|
Q:
|
What are the recommendations of the PACI Board?
|
A:
|
After careful consideration, and based in part on the unanimous recommendation of the Special Committee, the PACI Board
believes that the BCA Proposal and the other proposals to be presented at the Special Meeting are
|
Q:
|
What will happen in the Business Combination?
|
A:
|
Pursuant to the Business Combination Agreement, and subject to the terms and conditions contained therein, Merger Sub will
merge with and into Volato, with Volato surviving the merger. After giving effect to the merger, Volato will become a wholly-owned subsidiary of PACI. At the Closing, up to 17,989,305 shares of our Class A Common Stock will be issued to
the Volato stockholders in the Business Combination in exchange for all outstanding shares of Volato Common Stock and Preferred Stock. For more information about the Business Combination Agreement and the Business Combination, see the
section entitled “BCA Proposal.”
|
Q:
|
How were the transaction structure and consideration for the Business Combination determined?
|
A:
|
The Business Combination was the result of an extensive search for a potential transaction utilizing the network and
investing and operating experience of PACI’s management team as well as the PACI Board and the Venture Capital Advisory Board (“Network VC Advisory Board”). The transaction structure for the Business Combination was determined through
observing market practice, advice of counsel and tax advisors, and the discretion of the parties to the Business Combination. The consideration for the Business Combination was determined as a result of extensive negotiations between
PACI and Volato. Please see the section entitled “BCA Proposal - Background to the Business Combination” for more information.
|
Q:
|
What conditions must be satisfied to complete the Business Combination?
|
A:
|
There are several closing conditions in the Business Combination Agreement, including the approval by our stockholders of the
BCA Proposal, the Stock Issuance Proposal, the Charter Amendment Proposal, and the Stock Incentive Plan Proposal. For a summary of the conditions that must be satisfied or waived prior to completion of the Business Combination, see the
section entitled “BCA Proposal-The Business Combination Agreement-Conditions to Closing.”
|
Q:
|
How will we be managed and governed following the Business Combination?
|
A:
|
Immediately after the Closing, the Board of Directors of Volato Group, Inc. (“Volato Group” and its Board of Directors, the
“Volato Group Board”) will be composed of seven directors, six of whom are to be designated by Volato and one of whom will be designated by PACI. Such directors will be divided into three separate classes, which the Proposed Charter
designates as follows:
|
•
|
Class I comprised of two individuals whose terms will expire at Volato Group’s first annual meeting of stockholders to be
held after the completion of the Business Combination;
|
•
|
Class II comprised of two individuals (including the PACI designee) whose terms will expire at Volato Group’s second annual
meeting of stockholders to be held after the completion of the Business Combination;
|
•
|
Class III comprised of three individuals whose terms will expire at Volato Group’s third annual meeting of stockholders to be
held after the completion of the Business Combination.
|
Q:
|
What equity stake will our current public stockholders and the holders of our Class B Common Stock and
Class A Common Stock issued upon the conversion of Class B Common Stock (the “Founder Shares”) hold in Volato Group following the consummation of the Business Combination?
|
A:
|
We anticipate that, upon the Closing, the ownership of Volato Group will be as follows:
|
•
|
The shareholders of Volato will own 17,989,305 shares of Volato Group Class A Common Stock, which will constitute 57.4% of
the outstanding Volato Group Common Stock (defined below); and
|
•
|
the public stockholders will own 6,443,098 shares of Volato Group Class A Common Stock, which will constitute 20.6% of the
outstanding Volato Group Common Stock;
|
•
|
our Sponsor, one or more co-investment vehicles managed by the investment advisor of PROOF.vc (the “PROOF.vc SPV”) and
certain funds and accounts managed by BlackRock, Inc. (collectively referred to herein as “BlackRock”) will collectively own 6,900,000 shares of Volato Group Common Stock which will constitute 22.0% of the outstanding Common Stock of
the Volato Group, excluding shares issued to the Sponsor and the PROOF.vc SPV in the Private Financing (defined below).
|
Q:
|
Why is PACI proposing the Stock Issuance Proposal?
|
A:
|
PACI is proposing the Stock Issuance Proposal in order to comply with listing standards of the NYSE, which require
stockholders’ approval of certain transactions that result in the issuance of 20% or more of a company’s outstanding voting power or shares of common stock outstanding before the issuance of stock or securities. In connection with the
Business Combination, we will issue to the Volato stockholders a combined 17,989,305 shares of Class A Common Stock which would constitute 20% or more of our outstanding voting power and outstanding Common Stock. As a result, we are
required to obtain stockholder approval of such issuances pursuant to listing standards of the NYSE. See the section entitled “Stock Issuance Proposal” for additional information.
|
Q:
|
Did the PACI Board obtain a third-party valuation or fairness opinion in determining whether or not to
proceed with the Business Combination?
|
A:
|
Yes. The Special Committee of the PACI Board has received a fairness opinion from LSH Partners Securities LLC (“LSH”), dated
July 27, 2023. The PACI Board has not obtained, nor does it expect to obtain, an additional updated fairness opinion prior to the Closing. The operations and prospects of Volato and its subsidiaries, general market and economic
conditions, and other factors that may be beyond the control of PACI and Volato, and on which the LSH’s opinion was based, may alter the value of PACI or Volato or the price of PACI’s securities by the time the Business Combination is
completed. LSH’s opinion does not speak to any date other than the date of the opinion, and as such, LSH’s opinion does not address the fairness, from a financial point of view, to PACI of the Aggregate Merger Consideration (as defined
in “BCA Proposal-Opinion of LSH, the Special Committee’s Financial Advisor”) at any date after the date of the opinion, including at the time the Business Combination is completed.
|
Q:
|
What are some of the positive and negative factors that the PACI Board considered when determining to enter
into the Business Combination Agreement and its rationale for approving the Business Combination?
|
A:
|
The factors considered by the PACI Board include, but were not limited to, the following:
|
•
|
Meets the acquisition criteria that PACI had established to evaluate prospective business
combination targets. The PACI Board determined that Volato satisfies a number of the criteria and guidelines that PACI established at its IPO, including compelling long-term growth prospects, attractive competitive dynamics,
consolidation opportunities, and products or services with large total addressable markets. The key business characteristics that were focused on include the potential for disruptive technology or business model; attractive returns on
invested capital; significant streams of recurring revenue; operational improvement opportunities; attractive steady-state margins, incremental margins, and attractive free cash flow characteristics.
|
•
|
Exposure to an attractive market. The PACI Board believes that the private aviation
industry is a large and fast-growing market.
|
•
|
Market positioning. Volato operates in the private aviation market, which is growing
annually and has significant opportunities to grow market share. It operates in the continental United States with limited international service to Canada, Mexico, and other locations in the Caribbean and Central America.
|
•
|
Recommendation of the Special Committee. The Special Committee’s unanimous
recommendation that the PACI Board approve the Business Combination, and that the Special Committee had received the opinion issued by LSH that, as of the date of such opinion and based on and subject to the assumptions made, procedures
followed, matters considered and qualifications and limitations on the review undertaken as set forth in the opinion, the Aggregate Merger Consideration to be issued by PACI in the Business Combination was fair, from a financial point
of view, to PACI.
|
•
|
Other alternatives. The PACI Board’s belief that, after a thorough review of other
business combination opportunities reasonably available to PACI, that the Business Combination represents the best potential business combination for PACI and the most attractive opportunity for PACI’s management to accelerate its
business plan based upon the process utilized to evaluate and assess other potential business combination targets, and the PACI Board’s belief that such process has not presented a better alternative.
|
•
|
Negotiated transaction. The financial and other terms of the Business Combination
Agreement and the fact that such terms and conditions were the product of arm’s length negotiations between PACI and Volato.
|
•
|
Financial analysis conducted by PACI’s management team and valuation. The financial
analysis conducted by PACI’s management team and reviewed by the PACI Board supported the equity valuation of Volato.
|
•
|
Value to Stockholders. The Business Combination implies approximately $190 million
pre-transaction enterprise value which represents a sizeable discount to public trading market valuations of comparable companies across other private aviation companies. The set of comparable companies to Volato was selected based on
the existing universe of publicly traded companies at the time of approval of the transaction.
|
•
|
Benefits not achieved. The risk that the potential benefits of the Business
Combination may not be fully achieved, or may not be achieved within the expected timeframe.
|
•
|
Liquidation of PACI. The risks and costs to PACI if the Business Combination is not
completed, including the risk of diverting management focus and resources from other business combination opportunities, which could result in PACI being unable to effect a business combination prior to the expiration of the completion
window, thus forcing a liquidation of PACI.
|
•
|
Non-Solicitation. The fact that the Business Combination Agreement includes a
non-solicitation provision that prohibits PACI from soliciting other business combination proposals, which restricts PACI’s ability, so long as the Business Combination Agreement is in effect, to consider other potential business
combinations. Such restrictions are subject to fiduciary duties held by PACI’s board of directors, officers and professional advisors under applicable law that may allow PACI to take certain action otherwise not permitted under the
non-solicitation provision, as well as the right of PACI’s board of directors under the terms of the Business Combination Agreement to withdraw, amend, qualify, or modify its recommendation to PACI’s shareholders that they vote in favor
of the Proposals.
|
•
|
Shareholder vote. The risk that Volato Stockholders may fail to provide the votes
necessary to effect the Business Combination.
|
•
|
Future financial performance. The risk that the future financial performance of
Volato may not meet the PACI Board’s expectations due to factors in Volato’s control, including management execution, or out of its control, including economic cycles or other macroeconomic factors.
|
•
|
Closing conditions. The fact that completion of the Business Combination is
conditioned on the satisfaction of certain closing conditions that are not within PACI’s control, including approval by PACI’s shareholders and approval by the NYSE of the initial listing application in connection with the Business
Combination.
|
•
|
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.
|
•
|
Other risks. Various other risks associated with the Business Combination, the
business of PACI and the business of Volato described under the section entitled “Risk Factors.”
|
Q:
|
What happens if I sell my Public Shares before the Special Meeting?
|
A:
|
The record date for the Special Meeting is earlier than the date that the Business Combination is expected to be completed.
If you transfer your Public Shares after the record date, but before the Special Meeting, unless the transferee obtains from you a proxy to vote those shares, you will retain your right to vote at the Special Meeting. However, you will
not be able to seek redemption of your Public Shares because you will no longer be able to deliver them for cancellation upon consummation of the Business Combination in accordance with the provisions described in this proxy
statement/prospectus. If you transfer your Public Shares prior to the record date, you will have no right to vote those shares at the Special Meeting or seek redemption of those shares.
|
Q:
|
How has the announcement of the Business Combination affected the trading price of PACI’s units, Common Stock
and warrants?
|
A:
|
On August 1, 2023, the last trading date before the public announcement of the Business Combination, PACI’s public units,
Public Shares and public warrants closed at $10.64, $10.61 and $0.09, respectively. On , 2023, the trading date immediately prior to the date of this proxy statement/prospectus, PACI’s public units, Common Stock and public warrants
closed at $ , $ and $ , respectively.
|
Q:
|
Following the Business Combination, will PACI’s securities continue to trade on a stock exchange?
|
A:
|
Yes. We will apply to list the shares of Class A Common Stock of Volato Group on the NYSE under the new symbol “SOAR”
following the Closing.
|
Q:
|
What vote is required to approve the Proposals presented at the Special Meeting?
|
A:
|
Approval of the BCA Proposal requires the affirmative vote of the holders of a majority of the outstanding shares of Common
Stock of PACI present and entitled to vote at the Special Meeting. Approval of each of the Stock Issuance Proposal and the Stock Incentive Plan Proposal requires the affirmative vote of the holders of a majority of the shares of Common
Stock present in person or represented by proxy at the meeting and entitled to vote thereon. Approval of the Charter Amendment Proposal requires (i) the affirmative vote of the holders of a majority of the outstanding shares of Common
Stock entitled to vote thereon, voting together as a single class, (ii) the affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock entitled to vote thereon, voting together as a single class, and
(iii) the affirmative vote of the holders of a majority of the outstanding shares of Class B Common Stock entitled to vote thereon, voting together as a single class. Approval of the Adjournment Proposal requires the affirmative vote of
the holders of a majority of the outstanding shares of Common Stock represented in person or by proxy and entitled to vote thereon, regardless of whether a quorum is present.
|
Q:
|
May PACI’s Sponsor, directors, officers, advisors, or any of their respective affiliates purchase Public
Shares in connection with the Business Combination?
|
A:
|
Yes. In connection with the stockholder vote to approve the proposed Business Combination, our Sponsor, directors, officers,
advisors, and any of their respective affiliates may privately negotiate to purchase Public Shares from stockholders who would have otherwise elected to have their shares redeemed in conjunction with a proxy solicitation pursuant to the
proxy rules for a per share pro rata portion of the Trust Account. Our Sponsor, directors, officers, advisors, and any of their respective affiliates will not make any such purchases when they are in possession of any material
non-public information not disclosed to the seller of the Public Shares or during a restricted period under Regulation M under the Exchange Act. Such a purchase could include a contractual acknowledgement that the selling public
stockholder, although still the record holder of the Public Shares, is no longer the beneficial owner thereof and therefore agrees, not to exercise its redemption rights and could include a contractual provision that directs the
stockholder to vote the Public Shares in a manner directed by the purchaser. In the event that our Sponsor, directors, officers, advisors or any of their respective affiliates purchase Public Shares in privately negotiated transactions
from public stockholders who have already elected to exercise their redemption rights, the selling stockholders would be required to revoke their prior elections to redeem their shares. Any privately negotiated purchases may be effected
at purchase prices that are in excess of the per share pro rata portion of the Trust Account.
|
Q:
|
How many votes do I have at the Special Meeting?
|
A:
|
Our stockholders are entitled to one vote at the Special Meeting for each share of Common Stock held of record as of ,
2023, the record date for the Special Meeting. As of the close of business on the record date, there were 13,343,098 outstanding shares of Common Stock, which are held by our public stockholders, our Sponsor, the PROOF.vc SPV, and
Blackrock.
|
Q:
|
What constitutes a quorum at the Special Meeting?
|
A:
|
Holders of a majority of the issued and outstanding shares of Common Stock entitled to vote at the Special Meeting, virtually
present or represented by proxy, constitute a quorum. In the absence of a quorum, the
|
Q:
|
How will PACI’s Sponsor, the PROOF.vc SPV, and the directors and officers of PACI vote?
|
A:
|
Our Sponsor, the PROOF.vc SPV, and our directors and officers have agreed to vote any shares of Common Stock owned by them in
favor of the Business Combination. Currently, our Sponsor and the PROOF.vc SPV own 6,591,800 Founder Shares, or approximately 49.40% of our issued and outstanding shares of Common Stock. Other than their membership interest in our
Sponsor, our directors and officers do not own any of Common Stock.
|
Q:
|
What interests do PACI’s officers and directors have in the Business Combination?
|
A:
|
In considering the recommendation of the PACI Board to vote in favor of the Business Combination, stockholders should be
aware that, aside from their interests as stockholders, our Sponsor and certain of our directors and officers have interests in the Business Combination that are different from, or in addition to, those of other stockholders generally.
Our directors were aware of and considered these interests, among other matters, in evaluating the Business Combination, and in recommending to stockholders that they approve the Business Combination. Stockholders should take these
interests into account in deciding whether to approve the Business Combination. These interests include, among other things:
|
•
|
the fact that our Sponsor may convert any working capital loans that it may make to us into up to an additional 1,500,000
warrants at the price of $1.00 per warrant;
|
•
|
the fact that our Sponsor, the PROOF.vc SPV, and our officers and directors have agreed not to redeem any Public Shares held
by them in connection with a stockholder vote to approve the Business Combination;
|
•
|
the fact that our Sponsor paid $25,000 for the Founder Shares and that such securities will have a significantly higher value
at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2023, the record date for the
Special Meeting, resulting in a theoretical gain of $ ;
|
•
|
the fact that certain of PACI’s officers and directors collectively own, directly or indirectly, a material interest in our
Sponsor and may also be limited partners of the PROOF.vc SPV which has an investment in our Sponsor;
|
•
|
the anticipated appointment of to the Volato Group Board in connection with the closing of the Business Combination;
|
•
|
the fact that the members of our Sponsor and the PROOF.vc SPV will benefit from the completion of a Business Combination and
may be incentivized to complete an acquisition of a less favorable target company or on terms less favorable to stockholders rather than liquidate;
|
•
|
the fact that the members of our Sponsor and the PROOF.vc SPV can earn a positive rate of return on their investment, even if
other PACI stockholders experience a negative rate of return in the post-business combination company;
|
•
|
the fact that our officers and directors will be reimbursed for out-of-pocket expenses incurred in connection with activities
on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations;
|
•
|
the fact that our Sponsor, officers and directors will lose their entire investment in us if an initial Business Combination
is not completed; and
|
•
|
the fact that our Sponsor and the PROOF.vc SPV have entered into a Series A Preferred Stock Purchase Agreement (defined
below) with Volato with regard to the Private Financing and will continue to own Series A Preferred Stock in Volato even if the Business Combination with Volato is not consummated.
|
Q:
|
What happens if I vote against the BCA Proposal?
|
A:
|
Under our Current Charter, if the BCA Proposal is not approved and we do not otherwise consummate an alternative business
combination by September 3, 2023 (or October, 3, November 3, or December 3, as applicable, if extended pursuant to the terms of the Current Charter) or such later liquidation date as may be approved by our stockholders, we will be
required to dissolve and liquidate the Trust Account by returning the then-remaining funds in the Trust Account to our public stockholders.
|
Q:
|
Do I have redemption rights?
|
A:
|
If you are a holder of Public Shares, you may elect to have your Public Shares redeemed for cash at the applicable redemption
price per share. See “Special Meeting of PACI Stockholders - Redemption Rights.”
|
Q:
|
Will how I vote affect my ability to exercise redemption rights?
|
A:
|
No. You may exercise your redemption rights whether you vote your Public Shares for or against or abstain from voting on the
BCA Proposal or any other Proposal described in this proxy statement/prospectus. As a result, the Business Combination can be approved by stockholders who will redeem their Public Shares and no longer remain stockholders.
|
Q:
|
How do I exercise my redemption rights?
|
A:
|
In order to exercise your redemption rights, you must elect either (a) to physically tender or deliver your shares (and share
certificates (if any) and other redemption forms) to our transfer agent, at Continental Stock Transfer & Trust Company, One State Street Plaza, 30th Floor, New York, New York 10004-1561, Attn: SPAC Redemption, E-mail:
spacredemptions@continentalstock.com, by , 2023 or at least two business days prior to the Special Meeting (the “Redemption Deadline”) or (b) to deliver your shares to the transfer agent electronically using DTC’s DWAC System by the
Redemption Deadline, which election would likely be determined based on the manner in which you hold your shares. See “Special Meeting of PACI Stockholders - Redemption Rights.”
|
Q:
|
What are the material U.S. federal income tax consequences to the PACI stockholders as a result of the
Business Combination?
|
A:
|
PACI stockholders will retain their shares of Common Stock, will not receive any merger consideration, and will not receive
any additional shares of Common Stock in the Business Combination. As a result, there will be no material U.S. federal income tax consequences to the current PACI stockholders as a result of the Business Combination, regardless of
whether the Business Combination qualifies as a “reorganization” within the meaning of Section 368(a) of the Code. Furthermore, although the Business Combination is intended to qualify as a “reorganization” within the meaning of
Section 368(a) of the Code, and PACI and Volato intend to report the Business Combination consistent with that qualification, the treatment is not a condition to PACI or Volato’s obligation to complete the Business Combination.
|
Q:
|
What are the material U.S. federal income tax consequences of the Business Combination to Volato
Stockholders?
|
A:
|
The parties to the Business Combination Agreement intend for the Business Combination to qualify as a “reorganization” within
the meaning of Section 368(a) of the Code for U.S. federal income tax purposes. Provided that the Business Combination qualifies as a reorganization, no gain or loss generally will be recognized by a U.S. Holder (as defined below) of
Volato capital stock for U.S. federal income tax purposes on the exchange of its shares of Volato capital stock for Class A Common Stock of the Company in the Business Combination. For a more complete discussion of the material U.S.
federal income tax consequences of the Business Combination, please carefully review the information set forth in the section titled “Material
|
Q:
|
What are the U.S. federal income tax consequences of exercising my redemption rights?
|
A:
|
The receipt of cash by a public stock whose Public Shares are redeemed will be a taxable event for U.S. federal income tax
purposes in the case of a U.S. Holder (as defined below) and could be a taxable event for U.S. federal income tax purposes in the case of a Non-U.S. Holder (as defined below). Please see the discussion below under the caption “Material
U.S. Federal Income Tax Considerations - Tax Treatment of Redemption Election” for additional information. All holders considering the exercise of their redemption rights should consult with, and rely solely upon, their own tax advisors
with respect to the U.S. federal income tax consequences of exercising such redemption rights.
|
Q:
|
Do PACI stockholders have appraisal rights if I object to the proposed Business Combination?
|
A:
|
No. There are no appraisal rights available to holders of our Common Stock in connection with the Business Combination.
|
Q:
|
What happens to the funds deposited in the Trust Account after consummation of the Business combination?
|
A:
|
If the BCA Proposal is approved and the Business Combination is consummated, we intend to use a portion of the funds held in
the Trust Account to pay (a) a portion of our aggregate costs, fees, and expenses in connection with the consummation of the Business Combination, (b) tax obligations, and (c) for any redemptions of Public Shares. The remaining balance
in the Trust Account, together with the proceeds from any private financing, will be used for general corporate purposes of Volato Group. See the section entitled “BCA Proposal” for additional information.
|
Q:
|
What happens if the Business Combination is not consummated or is terminated?
|
A:
|
There are certain circumstances under which the Business Combination Agreement may be terminated. See the section entitled
“BCA Proposal - The Business Combination Agreement-Termination” for additional information regarding the parties’ specific termination rights. In accordance with our Current Charter, if an initial Business Combination is not consummated
by September 3, 2023 (or by October, 3, November 3, or December 3, 2023, as applicable, if we extend the period of time to consummate a Business Combination in full), we will (a) cease all operations except for the purpose of winding
up, (b) as promptly as reasonably possible but not more than ten business days thereafter subject to lawfully available funds therefor, redeem 100% of the Public Shares for cash for a redemption price per share equal to the aggregate
amount then held in the Trust Account including interest earned on the funds held in the Trust Account and not previously released to us to pay taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the total
number of then-outstanding Public Shares, which redemption will completely extinguish such stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), and (c) as promptly as
reasonably possible following such redemption, subject to the approval of our remaining stockholders and subject to the requirements of the General Corporation Law of the State of Delaware (“DGCL”), including the adoption of a
resolution by the PACI Board pursuant to Section 275(a) of the DGCL finding the dissolution of PACI advisable and the provision of such notices are as required by Section 275(a) of the DGCL, dissolve and liquidate, subject (in the cases
of clause (a) and (b)) to our obligations under the DGCL to provide for claims of creditors and other requirements of applicable law.
|
Q:
|
When is the Business Combination expected to be consummated?
|
A:
|
It is currently anticipated that the Business Combination will be consummated promptly following the Special Meeting of our
stockholders to be held on , 2023, provided that all the requisite stockholder approvals are obtained and other conditions to the consummation of the Business Combination have been satisfied or waived. For a description of the
conditions for the completion of the Business Combination, see the section entitled “BCA Proposal - The Business Combination Agreement- Conditions to Closing.”
|
Q:
|
What do I need to do now?
|
A:
|
You are urged to carefully read and consider the information contained in this proxy statement/prospectus, including the
section entitled “Risk Factors” and the annexes attached to this proxy statement/prospectus, and to consider how the Business Combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the
instructions provided in this proxy statement/prospectus and on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank, or other nominee, on the voting instruction form provided by the broker, bank or,
nominee. You should vote your proxy even if you intend to vote at the Special Meeting.
|
Q:
|
How do I vote?
|
A:
|
If you were a holder of record of Common Stock on , 2023, the record date for the Special Meeting of our stockholders, you
may vote with respect to the Proposals online at the Special Meeting or by completing, signing, dating, and returning the enclosed proxy card in the postage-paid envelope provided. If you hold your shares in “street name,” which means
your shares are held of record by a broker, bank, or other nominee, you should follow the instructions provided by your broker, bank, or nominee to ensure that votes related to the shares you beneficially own are properly counted. In
this regard, you must provide the record holder of your shares with instructions on how to vote your shares or, if you wish to virtually attend the Special Meeting and vote online, obtain a proxy from your broker, bank, or nominee.
|
Q:
|
What will happen if I abstain from voting or fail to vote at the Special Meeting?
|
A:
|
At the Special Meeting, we will count a properly executed proxy marked “ABSTAIN” with respect to a particular Proposal as
present for purposes of determining whether a quorum is present. For purposes of approval, an abstention will have the same effect as a vote “AGAINST” the BCA Proposal, the Stock Issuance Proposal, the Charter Amendment Proposal, the
Stock Incentive Plan Proposal, and the Adjournment Proposal. However, if you do not submit a proxy or voting instruction, do not attend the Special Meeting virtually or by proxy and your shares are not otherwise voted at the Special
Meeting, your failure to do so will have the same effect as a vote “AGAINST” the Charter Amendment Proposal but have no effect on the outcome of the other Proposals.
|
Q:
|
What will happen if I sign and submit my proxy card without indicating how I wish to vote?
|
A:
|
Signed and dated proxies received by us without an indication of how the stockholder intends to vote on a proposal will be
voted “FOR” each Proposal being submitted to a vote of the stockholders at the Special Meeting.
|
Q:
|
If I am not going to attend the Special Meeting online, should I submit my proxy card instead?
|
A:
|
Yes. Whether you plan to attend the Special Meeting or not, please read the enclosed proxy statement/prospectus carefully,
and vote your shares by completing, signing, dating, and returning the enclosed proxy card in the postage-paid envelope provided.
|
Q:
|
If my shares are held in “street name,” will my broker, bank, or nominee automatically vote my shares for me?
|
A:
|
No. Under the rules of various national and regional securities exchanges, your broker, bank, or nominee cannot vote your
shares with respect to non-discretionary matters unless you provide instructions on how to vote in
|
Q:
|
May I change my vote after I have submitted my executed proxy card?
|
A:
|
Yes. You may change your vote by sending a later-dated, signed proxy card to us at the address listed below so that it is
received by us prior to the Special Meeting or by attending the Special Meeting online and voting there. You also may revoke your proxy by sending a notice of revocation to us, which must be received prior to the Special Meeting.
|
Q:
|
What should I do if I receive more than one set of voting materials?
|
A:
|
You 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 in more than one name, you will receive more than one proxy card. Please complete, sign, date, and return each proxy card and voting instruction card that you receive in order to
cast your vote with respect to all of your shares.
|
Q:
|
Who can help answer my questions?
|
A:
|
If you have questions about the proposals or if you need additional copies of the proxy statement/prospectus or the enclosed
proxy card you should contact:
|
Q:
|
Who will solicit and pay the cost of soliciting proxies?
|
A:
|
The PACI Board is soliciting your proxy to vote your shares of Common Stock on all matters scheduled to come
|
(i).
|
by mutual written consent of PACI and Volato;
|
(ii).
|
prior to the Closing, by written notice by either PACI or Volato if the other party has breached its representations,
warranties, covenants, or agreements in the Business Combination Agreement such that the conditions to Closing cannot be satisfied and such breach cannot be cured within certain specified time periods; provided that the terminating
party is not then in material breach of its representation, warranties, covenants, or agreements under the Business Combination Agreement;
|
(iii).
|
prior to the Closing, by written notice by either PACI or Volato if the Transactions are not consummated on or before
December 1, 2023;
|
(iv).
|
prior to the Closing, by written notice by either PACI or Volato if the consummation of the Business Combination is
permanently enjoined or prohibited by the terms of a final, non-appealable, governmental order or a statue, rule, or regulation;
|
(v).
|
by either PACI or Volato if PACI stockholders do not approve the Business Combination Agreement at the Special Meeting; or
|
(vi).
|
by PACI if there has been a Change in Recommendation (as defined the Business Combination Agreement).
|
•
|
the fact that our Sponsor may convert any working capital loans that it may make to us into up to an additional 1,500,000
warrants at the price of $1.00 per warrant;
|
•
|
the fact that our Sponsor, the PROOF.vc SPV, and our officers and directors have agreed not to redeem any Public Shares
held by them in connection with a stockholder vote to approve the Business Combination;
|
•
|
the fact that our Sponsor paid $25,000 for the Founder Shares and that such securities will have a significantly higher
value at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2023, the record date for
the Special Meeting, resulting in a theoretical gain of $ ;
|
•
|
the fact that certain of PACI’s officers and directors collectively own, directly or indirectly, a material interest in our
Sponsor and may also be limited partners of the PROOF.vc SPV, which has an investment in our Sponsor;
|
•
|
the anticipated appointment of , as a director on the Volato Group Board in connection with the closing of the Business
Combination;
|
•
|
the fact that the members of our Sponsor and the PROOF.vc SPV will benefit from the completion of a Business Combination
and may be incentivized to complete an acquisition of a less favorable target company or on terms less favorable to stockholders rather than liquidate;
|
•
|
the fact that the members of our Sponsor and the PROOF.vc SPV can earn a positive rate of return on their investment, even
if other PACI stockholders experience a negative rate of return in the post-business combination company;
|
•
|
the fact that our officers and directors will be reimbursed for out-of-pocket expenses incurred in connection with
activities on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations;
|
•
|
the fact that our Sponsor, the PROOF.vc SPV, and our officers and directors will lose their entire investment in PACI if an
initial Business Combination is not completed; and
|
•
|
the fact that our Sponsor and the PROOF.vc SPV have entered into a Series A Preferred Stock Purchase Agreement with Volato
with regard to the Private Financing arrangement and will continue to own Series A Preferred Stock in Volato even if the Business Combination with Volato is not consummated.
|
•
|
the fact that, at the closing of the Business Combination, each of Matthew Liotta, Nicholas Cooper, Keith Rabin, Michael
Prachar, and Steven Drucker will enter into employment agreements which entitle them to certain contractual benefits and economic incentives;
|
•
|
the anticipated appointment of each of Matthew Liotta, Nicholas Cooper, Joan Sullivan Garrett, Michael Nichols and Robert
George, as directors on the Volato Group Board in connection with the closing of the Business Combination;
|
•
|
the fact that executive officers of Volato will have the ability to earn up to an additional 10% of the total equity of
Volato Group for no additional capital contribution pursuant to the 2023 Plan; and
|
•
|
the fact that certain of Volato’s officers and directors will collectively own, directly or indirectly, a material interest
in the Volato Group at the Closing of the Business Combination equal to approximately 39.00% of the voting interests.
|
•
|
Volato stockholders will own up to 17,989,305 shares of Class A Common Stock of Volato Group, which will constitute 57.4%
of the outstanding Volato Group Common Stock;
|
•
|
the public stockholders will own 6,443,098 shares of Class A Common Stock of Volato Group, which will constitute 20.6% of
the outstanding Volato Group Common Stock;
|
•
|
the Sponsor, the PROOF.vc SPV and BlackRock will collectively own 6,900,000 shares of Class A Common Stock of Volato Group,
which will constitute 22.0% of the outstanding Volato Group Common Stock excluding shares issued to the Sponsor and the PROOF.vc SPV in the Private Financing.
|
•
|
Under the Minimum and Maximum Redemption Scenarios, legacy Volato stockholders will have a majority of the voting interest
in Volato Group with approximately 57.4% and 72.3%, respectively, of the voting interest;
|
•
|
The senior management of Volato Group will be comprised of individuals from Volato as further described below;
|
•
|
The largest single stockholder of Volato Group will be a legacy stockholder of Volato;
|
•
|
Volato will designate a majority of the initial board of directors of Volato Group.
|
•
|
An individual from Volato will be designated as the chairman of the initial board of directors of Volato Group and the
Chief Executive Officer of Volato Group and a second individual from Volato will be designated as the Chief Financial Officer of Volato Group and the remaining members of senior management of Volato Group will be comprised entirely of
individuals from Volato.
|
•
|
Volato’s operations will comprise the ongoing operations of Volato Group.
|
•
|
Volato has a limited operating history and history of net losses, and may continue to experience net losses in the future.
|
•
|
We may not be able to successfully implement our growth strategies.
|
•
|
If Volato is not able to successfully enter into new markets and services and enhance our existing products and services,
our business, financial condition and results of operations could be adversely affected.
|
•
|
Volato may require substantial additional funding to finance its operations, but adequate additional financing may not be
available when it needs it, on commercially acceptable terms or at all.
|
•
|
The loss of key personnel upon whom Volato depends on to operate its business or the inability to attract additional
qualified personnel could adversely affect its business.
|
•
|
The supply of pilots to the aviation industry is limited and may negatively affect Volato’s operations and financial
condition. Increases in Volato’s labor costs, which constitute a substantial portion of its total operating costs, may adversely affect its business, results of operations and financial condition.
|
•
|
Volato may be subject to unionization, work stoppages, slowdowns or increased labor costs and the unionization of its
employees could result in increased labor costs.
|
•
|
Federal, state and local tax rules can adversely impact Volato’s results of operations and financial position.
|
•
|
Significant increases in fuel costs could have a material adverse effect on Volato’s business, financial condition and
results of operations.
|
•
|
If Volato faces problems with any of its third-party service providers, its operations could be adversely affected.
|
•
|
Volato’s insurance may become too difficult or expensive for it to obtain. Increases in insurance costs or reductions in
insurance coverage may materially and adversely impact Volato’s results of operations and financial position.
|
•
|
If Volato’s efforts to continue to build its strong brand identity and achieve high member satisfaction and loyalty are not
successful, it may not be able to attract or retain customers, and its operating results may be adversely affected.
|
•
|
Any failure to offer high-quality customer support may harm Volato’s relationships with its customers and could adversely
affect our reputation, brand, business, financial condition and results of operations.
|
•
|
Volato’s business is primarily focused on certain targeted geographic markets, making us vulnerable to risks associated
with having geographically concentrated operations.
|
•
|
Volato’s operations require it to comply with various domestic and international regulations, violations of which could
have a material adverse effect on Volato’s business, results of operations, financial condition and cash flows.
|
•
|
Compliance with environmental laws and regulations may adversely affect Volato’s business and results of operations.
|
•
|
Volato is a holding company whose only material asset is the equity interests in its operating subsidiaries, and
accordingly, it is dependent upon distributions from these operating subsidiaries to pay taxes and cover its corporate and other overhead expenses.
|
•
|
If Volato Group fails to maintain an effective system of disclosure controls and internal control over financial reporting,
Volato Group’s ability to produce timely and accurate financial statements or comply with applicable regulations cover be impaired, which may adversely affect investor confidence in Volato Group, and, as a result, the market price of
the Common Stock of Volato Group.
|
•
|
Following the Closing, Volato Group will incur significant increased expenses and administrative burdens as a public
company, which could have an adverse effect on its business, financial condition and operating results.
|
•
|
There is substantial doubt about PACI’s ability to continue as a going concern should a Business Combination not occur.
|
•
|
PACI may not be able to complete its initial Business Combination within the prescribed time frame, in which case it would
cease all operations except for the purpose of winding up and it would redeem its Public Shares and liquidate, in which PACI’s public stockholders may only receive $ per share, or less than such amount in certain circumstances, and
its warrants would expire worthless.
|
•
|
If PACI’s due diligence investigation of Volato was inadequate, then shareholders of PACI following the Business
Combination could lose some or all of their investment.
|
•
|
Shareholder litigation and regulatory inquiries and investigations are expensive and could harm PACI’s business, financial
condition, and operating results and could divert management attention.
|
•
|
PACI’s stockholders will experience immediate dilution as a consequence of, among other transactions, the issuance of the
Common Stock of Volato Group as consideration in the Business Combination.
|
•
|
Past performance by PACI and by PACI’s management team may not be indicative of future performance of an investment in PACI
or Volato Group.
|
•
|
If the Business Combination’s benefits do not meet the expectation of financial or industry analysts, the market price of
PACI’s securities may decline.
|
•
|
A 1% U.S. federal excise tax may be imposed upon PACI in connection with the net redemptions by PACI of its Common Stock.
|
•
|
If third parties bring claims against PACI, the proceeds held in the Trust Account may be reduced and the per-share
redemption price received by stockholders may be less than approximately $ .
|
•
|
Subsequent to the consummation of the Business Combination, PACI may be required to take write-downs or write-offs,
restructuring and impairment, or other charges that could have a significant effect on its financial conditions, results of operations, and stock price, which could cause you to lose some or all of your investment.
|
•
|
PACI will incur significant transaction costs in connection with the Business Combination.
|
•
|
PACI cannot be certain as to the number of Public Shares that will be redeemed or the potential impact to public
stockholders who do not elect to redeem their Public Shares.
|
•
|
If PACI’s public stockholders fail to comply with the redemption requirements specified in this proxy statement/prospectus,
they will not be entitled to redeem their Public Shares for a pro rata portion of the funds held in the Trust Account.
|
•
|
the accompanying notes to the unaudited pro forma condensed combined financial statements;
|
•
|
the historical unaudited financial statements of PACI as of and for the six months ended June 30, 2023 and the related notes
thereto, included elsewhere in this proxy statement;
|
•
|
the historical unaudited financial statements of Volato as of and for the six months ended June 30, 2023 and the related
notes thereto, included elsewhere in this proxy statement;
|
•
|
the historical audited financial statements of PACI as of and for the year ended December 31, 2022 and the related notes
thereto, included elsewhere in this proxy statement;
|
•
|
the historical audited financial statements of Volato as of and for the year ended December 31, 2022 and the related notes
thereto, included elsewhere in this proxy statement; and
|
•
|
the sections entitled “Management’s Discussion and Analysis of Financial Condition and
Results of Operations of PACI” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Volato,” and other financial information relating to PACI and
Volato included elsewhere in this proxy statement, including the Business Combination Agreement.
|
•
|
Assuming No Redemptions (“Minimum Redemption”) — this scenario assumes that no
Public Shares are redeemed;
|
•
|
Maximum Redemptions (“Maximum Redemption”) — this scenario assumes the redemption
of approximately 6.4 million Public Shares at $10.59 per share, for aggregate payment of approximately $68.2 million from the Trust Account.
|
|
| |
Volato
(Historical)
|
| |
Volato
Funding
Round
July 2023
|
| |
PACI
(Historical)
|
| |
Pro Forma
Adjustments
Assuming
Minimum
Redemption
|
| |
|
| |
Pro Forma
Combined
Assuming
Minimum
Redemption
|
| |
Pro Forma
Adjustments
Assuming
Minimum
Redemption
|
| |
|
| |
Pro Forma
Combined
Assuming
Minimum
Redemption
|
ASSETS
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Cash and cash equivalents
|
| |
$5,371
|
| |
10,000
|
| |
2,030
|
| |
68,616
|
| |
A
|
| |
$ 81,017
|
| |
(68,217)
|
| |
E
|
| |
12,800
|
|
| |
|
| |
|
| |
|
| |
(5,000)
|
| |
B
|
| |
|
| |
|
| |
|
| |
|
Accounts receivable
|
| |
1,552
|
| |
|
| |
|
| |
|
| |
|
| |
1,552
|
| |
|
| |
|
| |
1,552
|
Deposits on aircraft
|
| |
19,183
|
| |
|
| |
|
| |
|
| |
|
| |
19,183
|
| |
|
| |
|
| |
19,183
|
Prepaid expenses and other current assets
|
| |
2,240
|
| |
|
| |
263
|
| |
|
| |
|
| |
2,503
|
| |
|
| |
|
| |
2,503
|
Total current assets
|
| |
28,346
|
| |
10,000
|
| |
2,293
|
| |
63,616
|
| |
|
| |
104,255
|
| |
(68,217)
|
| |
|
| |
36,038
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Non-current assets:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Cash and marketable securities held in Trust Account
|
| |
|
| |
|
| |
68,616
|
| |
(68,616)
|
| |
A
|
| |
—
|
| |
|
| |
|
| |
—
|
Equity method investment
|
| |
154
|
| |
|
| |
|
| |
|
| |
|
| |
154
|
| |
|
| |
|
| |
154
|
Restricted cash
|
| |
2,116
|
| |
|
| |
|
| |
|
| |
|
| |
2,116
|
| |
|
| |
|
| |
2,116
|
Goodwill
|
| |
635
|
| |
|
| |
|
| |
|
| |
|
| |
635
|
| |
|
| |
|
| |
635
|
Deposits
|
| |
4,500
|
| |
|
| |
|
| |
|
| |
|
| |
4,500
|
| |
|
| |
|
| |
4,500
|
Other deposits
|
| |
75
|
| |
|
| |
|
| |
|
| |
|
| |
75
|
| |
|
| |
|
| |
75
|
Intangibles
|
| |
1,421
|
| |
|
| |
|
| |
|
| |
|
| |
1,421
|
| |
|
| |
|
| |
1,421
|
Right of use asset
|
| |
1,429
|
| |
|
| |
|
| |
|
| |
|
| |
1,429
|
| |
|
| |
|
| |
1,429
|
Property and equipment, net
|
| |
821
|
| |
|
| |
|
| |
|
| |
|
| |
821
|
| |
|
| |
|
| |
821
|
Total non-current assets
|
| |
11,151
|
| |
—
|
| |
68,616
|
| |
(68,616)
|
| |
|
| |
11,151
|
| |
—
|
| |
|
| |
11,151
|
TOTAL ASSETS
|
| |
39,497
|
| |
10,000
|
| |
70,909
|
| |
(5,000)
|
| |
|
| |
115,406
|
| |
(68,217)
|
| |
|
| |
47,189
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
LIABILITIES, TEMPORARY EQUITY AND
STOCKHOLDERS’ EQUITY (DEFICIT)
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Accounts payable and accrued expenses
|
| |
7,593
|
| |
|
| |
358
|
| |
|
| |
|
| |
7,951
|
| |
|
| |
|
| |
7,951
|
Excise tax payable
|
| |
|
| |
|
| |
2,210
|
| |
|
| |
|
| |
2,210
|
| |
|
| |
|
| |
2,210
|
Loan - related party
|
| |
1,000
|
| |
|
| |
|
| |
|
| |
|
| |
1,000
|
| |
|
| |
|
| |
1,000
|
Convertible notes
|
| |
35,509
|
| |
|
| |
|
| |
(35,509)
|
| |
H
|
| |
—
|
| |
|
| |
|
| |
—
|
Accrued interest
|
| |
748
|
| |
|
| |
|
| |
(714)
|
| |
H
|
| |
34
|
| |
|
| |
|
| |
34
|
Deposits
|
| |
3,226
|
| |
|
| |
|
| |
|
| |
|
| |
3,226
|
| |
|
| |
|
| |
3,226
|
Operating lease liability
|
| |
304
|
| |
|
| |
|
| |
|
| |
|
| |
304
|
| |
|
| |
|
| |
304
|
Other loans
|
| |
23
|
| |
|
| |
|
| |
|
| |
|
| |
23
|
| |
|
| |
|
| |
23
|
Income taxes payable
|
| |
|
| |
|
| |
1,852
|
| |
|
| |
|
| |
1,852
|
| |
|
| |
|
| |
1,852
|
Total current liabilities
|
| |
48,403
|
| |
|
| |
4,420
|
| |
(36,223)
|
| |
|
| |
16,600
|
| |
|
| |
|
| |
16,600
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Non-current liabilities:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Deferred taxes
|
| |
305
|
| |
|
| |
60
|
| |
|
| |
|
| |
365
|
| |
|
| |
|
| |
365
|
Operating lease liability
|
| |
1,133
|
| |
|
| |
|
| |
|
| |
|
| |
1,133
|
| |
|
| |
|
| |
1,133
|
Long term notes payable
|
| |
12,654
|
| |
|
| |
|
| |
|
| |
|
| |
12,654
|
| |
|
| |
|
| |
12,654
|
Total non-current liabilities
|
| |
14,092
|
| |
|
| |
60
|
| |
—
|
| |
|
| |
14,152
|
| |
—
|
| |
|
| |
14,152
|
Total liabilities
|
| |
62,495
|
| |
|
| |
4,480
|
| |
(36,223)
|
| |
|
| |
30,752
|
| |
—
|
| |
|
| |
30,752
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
COMMITMENTS AND CONTINGENCIES
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Temporary equity:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Common stock subject to possible redemption
|
| |
|
| |
|
| |
68,217
|
| |
(68,217)
|
| |
C
|
| |
—
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Stockholders’ equity (deficit):
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Common stock
|
| |
4
|
| |
|
| |
|
| |
(1)
|
| |
F
|
| |
3
|
| |
|
| |
|
| |
3
|
Class A common stock
|
| |
|
| |
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Class B common stock
|
| |
|
| |
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Preferred stock
|
| |
7
|
| |
|
| |
|
| |
(7)
|
| |
G
|
| |
|
| |
|
| |
|
| |
|
Additional paid-in capital
|
| |
5,221
|
| |
10,000
|
| |
—
|
| |
68,217
|
| |
C
|
| |
112,881
|
| |
(68,217)
|
| |
E
|
| |
44,664
|
|
| |
|
| |
|
| |
|
| |
(1,788)
|
| |
D
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
(5,000)
|
| |
B
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
1
|
| |
F
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
7
|
| |
G
|
| |
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
| |
36,223
|
| |
H
|
| |
|
| |
|
| |
|
| |
|
Equity contribution receivable
|
| |
(15)
|
| |
|
| |
|
| |
|
| |
|
| |
(15)
|
| |
|
| |
|
| |
(15)
|
Retained earnings (Accumulated deficit)
|
| |
(28,215)
|
| |
|
| |
(1,788)
|
| |
1,788
|
| |
D
|
| |
(28,215)
|
| |
|
| |
|
| |
(28,215)
|
Total equity
|
| |
(22,998)
|
| |
10,000
|
| |
(1,788)
|
| |
99,440
|
| |
|
| |
84,654
|
| |
(68,217)
|
| |
|
| |
16,437
|
TOTAL LIABILITIES, TEMPORARY EQUITY AND
STOCKHOLDERS’ DEFICIT
|
| |
39,497
|
| |
10,000
|
| |
70,909
|
| |
(5,000)
|
| |
|
| |
115,406
|
| |
(68,217)
|
| |
|
| |
47,189
|
|
| |
Volato
(Historical)
|
| |
PACI
(Historical)
|
| |
Pro Forma
Adjustments
Assuming
Minimum
Redemption
|
| |
|
| |
Pro Forma
Combined
Assuming
Minimum
Redemption
|
| |
Pro Forma
Adjustments
Assuming
Maximum
Redemption
|
| |
Pro Forma
Combined
Assuming
Maximum
Redemption
|
Revenues
|
| |
$28,680
|
| |
$—
|
| |
$—
|
| |
|
| |
$28,680
|
| |
—
|
| |
28,680
|
Cost of revenue
|
| |
34,852
|
| |
—
|
| |
—
|
| |
|
| |
34,852
|
| |
—
|
| |
34,852
|
Gross profit
|
| |
(6,172)
|
| |
—
|
| |
—
|
| |
|
| |
(6,172)
|
| |
—
|
| |
(6,172)
|
Operating costs and expenses:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
General and administrative expenses
|
| |
10,575
|
| |
1,223
|
| |
|
| |
|
| |
11,798
|
| |
|
| |
11,798
|
Total operating costs and expenses
|
| |
10,575
|
| |
1,223
|
| |
—
|
| |
|
| |
11,798
|
| |
—
|
| |
11,798
|
Income (Loss) from operations
|
| |
(16,747)
|
| |
(1,223 )
|
| |
—
|
| |
|
| |
(17,970)
|
| |
—
|
| |
(17,970)
|
Other income (expense):
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |||||
Gain from sale of Part 135 Certificate
|
| |
387
|
| |
|
| |
|
| |
|
| |
387
|
| |
|
| |
387
|
Gain from sale of equity method investment
|
| |
440
|
| |
|
| |
|
| |
|
| |
440
|
| |
|
| |
440
|
Income from equity method investments
|
| |
22
|
| |
|
| |
|
| |
A
|
| |
22
|
| |
|
| |
22
|
Interest income
|
| |
14
|
| |
5,511
|
| |
5,511
|
| |
A
|
| |
14
|
| |
|
| |
14
|
Interest expense
|
| |
(1,636)
|
| |
|
| |
465
|
| |
BB
|
| |
(1,171)
|
| |
|
| |
(1,171)
|
Other income (expense)
|
| |
146
|
| |
|
| | | |
|
| |
146
|
| |
|
| |
146
|
|
Total other income (expense)
|
| |
(627)
|
| |
5,511
|
| |
(5,046)
|
| |
|
| |
(162)
|
| |
—
|
| |
(162)
|
Net income (loss) before income tax
provision
|
| |
(17,374)
|
| |
4,288
|
| |
(5,046)
|
| |
A
|
| |
(18,132)
|
| |
—
|
| |
(18,132)
|
Income tax provision
|
| | | |
(1,139)
|
| |
1,139
|
| |
A
|
| |
—
|
| |
|
| |
—
|
|
Net income (loss)
|
| |
(17,374)
|
| |
3,149
|
| |
(3,907)
|
| |
|
| |
(18,132)
|
| |
|
| |
(18,132)
|
|
| |
Volato
(Historical)
|
| |
PACI
(Historical)
|
| |
Assuming
Minimum
Redemption
|
| |
Assuming
Maximum
Redemption
|
Weighted average shares outstanding - Common stock
|
| |
7,193,178
|
| |
—
|
| |
31,332,403
|
| |
24,889,305
|
Basic and diluted net income per share - Common stock
|
| |
(2.42)
|
| |
—
|
| |
(0.58)
|
| |
(0.73)
|
Weighted average shares outstanding - Class A common stock
subject to redemption
|
| |
|
| |
22,690,664
|
| |
|
| |
|
Basic and diluted net income per share - Class A common
stock subject to redemption
|
| |
—
|
| |
0.11
|
| |
|
| |
|
Weighted average shares outstanding - Class B
non-redeemable common stock
|
| |
—
|
| |
6,900,000
|
| |
—
|
| |
—
|
Basic and diluted net income per share - Class B
non-redeemable common stock
|
| |
—
|
| |
0.11
|
| |
—
|
| |
—
|
|
| |
Volato
(Historical)
|
| |
PACI
(Historical)
|
| |
Pro Forma
Adjustments
Assuming
Minimum
Redemption
|
| |
|
| |
Pro Forma
Combined
Assuming
Minimum
Redemption
|
| |
Pro Forma
Adjustments
Assuming
Maximum
Redemption
|
| |
Pro Forma
Combined
Assuming
Maximum
Redemption
|
Revenues
|
| |
$ 96,706
|
| |
$—
|
| |
$—
|
| |
|
| |
$96,706
|
| |
—
|
| |
96,706
|
Cost of revenue
|
| |
94,281
|
| |
—
|
| |
—
|
| |
|
| |
94,281
|
| |
—
|
| |
94,281
|
Gross profit
|
| |
2,425
|
| |
—
|
| |
—
|
| |
|
| |
2,425
|
| |
—
|
| |
2,425
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Operating costs and expenses:
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
General and administrative expenses
|
| |
11,609
|
| |
1,737
|
| |
5,000
|
| |
BB
|
| |
18,346
|
| |
|
| |
18,346
|
Total operating costs and expenses
|
| |
11,609
|
| |
1,737
|
| |
5,000
|
| |
|
| |
18,346
|
| |
—
|
| |
18,346
|
Income (Loss) from operations
|
| |
(9,184)
|
| |
(1,737)
|
| |
(5,000)
|
| |
|
| |
(15,921)
|
| |
—
|
| |
(15,921)
|
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Other income (expense):
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Interest income
|
| |
2
|
| |
4,061
|
| |
(4,061)
|
| |
AA
|
| |
2
|
| |
|
| |
2
|
Interest expense
|
| |
(868)
|
| |
|
| |
(14,915)
|
| |
CC
|
| |
(15,783)
|
| |
|
| |
(15,783)
|
Gain on sale, net
|
| |
536
|
| |
|
| |
|
| |
|
| |
536
|
| |
|
| |
536
|
Other income (expense)
|
| |
60
|
| |
|
| |
|
| |
|
| |
60
|
| |
|
| |
60
|
Total other income (expense)
|
| |
(270)
|
| |
4,061
|
| |
(18,976)
|
| |
|
| |
(15,185)
|
| |
—
|
| |
(15,185)
|
Net income (loss) before income tax
provision
|
| |
(9,454)
|
| |
2,324
|
| |
(23,976)
|
| |
|
| |
(31,106)
|
| |
—
|
| |
(31,106)
|
Income tax provision
|
| |
55
|
| |
(773)
|
| |
773
|
| |
|
| |
55
|
| |
|
| |
55
|
Net income attributed to controlling shareholder
|
| |
(9,399)
|
| |
1,551
|
| |
(23,203)
|
| |
|
| |
(31,051)
|
| |
|
| |
(31,051)
|
Less: net income (loss) attributable to non-controlling
interests
|
| |
(33)
|
| |
(33)
|
| |
|
| |
|
| |
(33)
|
| |
|
| | |
Net income (loss)
|
| |
(9,366)
|
| |
1,551
|
| |
(23,203)
|
| |
|
| |
(31,018)
|
| |
—
|
| |
(31,018)
|
|
| |
Volato
(Historical)
|
| |
PACI
(Historical)
|
| |
Assuming
Minimum
Redemption
|
| |
Assuming
Maximum
Redemption
|
Weighted average shares outstanding - Common stock
|
| |
7,120,208
|
| |
—
|
| |
31,332,403
|
| |
24,889,305
|
Basic and diluted net income per share - Common stock
|
| |
(1.32)
|
| |
—
|
| |
(0.99)
|
| |
(1.25)
|
Weighted average shares outstanding - Class A common stock
subject to redemption
|
| |
|
| |
27,600,000
|
| |
|
| |
|
Basic and diluted net income per share - Class A common
stock subject to redemption
|
| |
—
|
| |
0.05
|
| |
|
| |
|
Weighted average shares outstanding - Class B
non-redeemable common stock
|
| |
—
|
| |
6,900,000
|
| |
—
|
| |
—
|
Basic and diluted net income per share - Class A and
Class B non-redeemable common stock
|
| |
—
|
| |
0.05
|
| |
—
|
| |
—
|
|
| |
minimum
redemption
|
| |
|
| |
maximum
redemption
|
| |
|
Public stockholders
|
| |
6,443,098
|
| |
20.6%
|
| |
—
|
| |
0.0%
|
Sponsor, PROOF.vc SPV, and BlackRock
|
| |
6,900,000
|
| |
22.0%
|
| |
6,900,000
|
| |
27.7%
|
Volato
|
| |
17,989,305
|
| |
57.4%
|
| |
17,989,305
|
| |
72.3%
|
Total
|
| |
31,332,403
|
| |
100%
|
| |
24,889,305
|
| |
100%
|
|
| |
Volato
Historical
|
| |
PACI
Historical
|
| |
Pro forma
Minimum
Redemption
|
| |
Pro forma
Maximum
Redemption
|
Weighted average shares outstanding - Common Stock
|
| |
7,193,178
|
| |
|
| |
31,332,403
|
| |
24,889,305
|
Basic and diluted net income per share - Common Stock
|
| |
(2.42)
|
| |
|
| |
(0.58)
|
| |
(0.73)
|
Weighted average shares outstanding - Common Stock subject
to redemption
|
| |
|
| |
22,690,664
|
| |
|
| |
|
Basic and diluted net income per share - Common Stock
subject to redemption
|
| |
|
| |
0.11
|
| |
|
| |
|
Weighted average shares outstanding - non-redeemable
Common Stock
|
| |
|
| |
6,900,000
|
| |
—
|
| |
—
|
Basic and diluted net income per share - non-redeemable
Common Stock
|
| |
|
| |
0.11
|
| |
—
|
| |
—
|
|
| |
Volato
Historical
|
| |
PACI
Historical
|
| |
Pro forma
Minimum
Redemption
|
| |
Pro forma
Maximum
Redemption
|
Weighted average shares outstanding - Common Stock
|
| |
7,120,208
|
| |
|
| |
31,332,403
|
| |
24,889,305
|
Basic and diluted net loss per share - Common Stock
|
| |
$(1.32)
|
| |
|
| |
(0.99)
|
| |
(1.25)
|
Weighted average shares outstanding - Common Stock subject
to redemption
|
| |
|
| |
27,600,000
|
| |
|
| |
|
Basic and diluted net income per share - Common Stock
subject to redemption
|
| |
|
| |
0.05
|
| |
|
| |
|
Weighted average shares outstanding - non-redeemable
Common Stock
|
| |
|
| |
6,900,000
|
| |
—
|
| |
—
|
Basic and diluted net income per share - non-redeemable
Common Stock
|
| |
|
| |
0.05
|
| |
—
|
| |
—
|
•
|
Assuming No Redemptions: This column assumes that no public stockholders exercise redemption rights with respect to their
Public Shares.
|
•
|
Assuming Maximum Redemptions: This column assumes that public stockholders holding 6,443,098 Public Shares will exercise
their redemption rights for their pro rata share (approximately $10.59 per share) of funds in the Trust Account. The Current Charter provides that PACI will only proceed with the Business combination if it will have net tangible assets
(as determined in accordance with Rule 3a51-1(g)(1) under the Exchange Act) of at least $5,000,001 unless the Common Stock otherwise does not constitute “penny stock” as such term is defined in Rule 3a51-1 under the Exchange Act.
Because we anticipate that the Common Stock will be listed on NYSE following the Closing, and such listing would mean that the Common Stock would not constitute “penny stock” as such term is defined in Rule 3a51-1 under the Exchange
Act, we do not anticipate the $5,000,001 net tangible asset threshold being applicable.
|
|
| |
Volato
Historical
|
| |
PACI
Historical
|
| |
Pro forma
Minimum
Redemption
|
| |
Pro forma
Maximum
Redemption
|
Book value per share
|
| |
(3.23)
|
| |
(0.06)
|
| |
2.70
|
| |
0.66
|
Weighted average shares outstanding - common stock
|
| |
7,193,178
|
| |
|
| |
31,332,403
|
| |
24,889,305
|
Basic and diluted net income per share - common stock
|
| |
(2.42)
|
| |
|
| |
(0.58)
|
| |
(0.73)
|
Weighted average shares outstanding - common stock subject
to redemption
|
| |
|
| |
22,690,664
|
| |
|
| |
|
Basic and diluted net income per share - common stock
subject to redemption
|
| |
|
| |
0.11
|
| |
|
| |
|
Weighted average shares outstanding - non-redeemable
common stock
|
| |
|
| |
6,900,000
|
| |
—
|
| |
—
|
Basic and diluted net income per share - non-redeemable
common stock
|
| |
|
| |
0.11
|
| |
—
|
| |
—
|
•
|
insufficient revenue to offset liabilities assumed;
|
•
|
inability to obtain any required third-party approvals;
|
•
|
requirements to enter into restrictive covenants in connection with obtaining third-party consents;
|
•
|
inadequate return of capital;
|
•
|
regulatory or compliance issues, including securing and maintaining regulatory approvals;
|
•
|
unidentified issues not discovered in due diligence;
|
•
|
integrating the operations or (as applicable) separately maintaining the operations;
|
•
|
financial reporting;
|
•
|
managing geographically dispersed operations;
|
•
|
potential unknown risks associated with an acquisition;
|
•
|
unanticipated expenses related to acquired businesses or technologies and their integration into Volato’s existing business
or technology;
|
•
|
the potential loss of key employees, customers or partners of an acquired business; or
|
•
|
the tax effects of any acquisitions.
|
•
|
Prior to the Business Combination, Volato operated as a private company. Its historical financial information reflects
allocations of corporate expenses as a private company. These allocations may not reflect the costs we will incur for similar services in the future as a publicly traded company.
|
•
|
Volato’s historical financial information does not reflect changes that we expect to experience in the future as a result of
becoming a publicly traded company, including changes in the financing, insurance, cash management, operations, cost structure, and personnel needs of our business. As a publicly traded company, Volato may be unable to purchase goods,
services, and technologies, such as insurance and health care benefits and computer software licenses, or access capital markets, on terms as favorable to us as those Volato obtained as a private company prior to the Business
Combination, and its results of operations may be adversely affected. In addition, Volato’s historical financial data do not include an allocation of interest expense comparable to the interest expenses it may incur as a result of the
Business Combination and related transactions, if any new financing arrangements are entered into between now and the close of the Transaction.
|
•
|
the fact that our Sponsor may convert any working capital loans that it may make to us into up to an additional 1,500,000
warrants, at the price of $1.00 per warrant;
|
•
|
the fact that our Sponsor, the PROOF.vc SPV, and our officers and directors have agreed not to redeem Public Shares held by
them in connection with a stockholder vote to approve the Business Combination;
|
•
|
the fact that our Sponsor paid $25,000 for the Founder Shares and that such securities will have a significantly higher value
at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2023, the record date for the
Special Meeting, resulting in a theoretical gain of $ ;
|
•
|
the fact that certain of PACI’s officers and directors collectively own, directly or indirectly, a material interest in our
Sponsor and may also be limited partners of the PROOF.vc SPV, which has an investment in our Sponsor;
|
•
|
the anticipated appointment of to the Volato Group Board in connection with the closing of the Business Combination;
|
•
|
the fact that the members of our Sponsor and the PROOF.vc SPV will benefit from the completion of a Business Combination and
may be incentivized to complete an acquisition of a less favorable target company or on terms less favorable to stockholders rather than liquidate;
|
•
|
the fact that the members of our Sponsor and the PROOF.vc SPV can earn a positive rate of return on their investment, even if
other PACI stockholders experience a negative rate of return in the post-business combination company;
|
•
|
the fact that our officers and directors will be reimbursed for out-of-pocket expenses incurred in connection with activities
on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations;
|
•
|
the fact that our Sponsor, the PROOF.vc SPV and our officers and directors will lose their entire investment in PACI if an
initial Business Combination is not completed;
|
•
|
the fact that our Sponsor and the PROOF.vc SPV entered into a Series A Preferred Stock Purchase Agreement with Volato with
regard to the Private Financing (as described below) and will continue to own Series A Preferred Stock in Volato even if the Business Combination with Volato is not consummated; and
|
•
|
the fact that, pursuant to the terms of the Private Financing arrangement as well as the Sponsor Support Agreement, our
Sponsor is required to vote in favor of the Business Combination.
|
•
|
the ability of our Board to issue shares of preferred stock, including “blank check” preferred stock and to determine the
terms of those shares, including the designations, powers (including voting powers, if any), preferences and relative, participating, optional, special and other rights, if any, without stockholder approval, which could be used to
significantly dilute the ownership of a hostile acquirer;
|
•
|
the rights of our directors and officers to indemnification and advancement of expenses;
|
•
|
the exculpation of directors and officers of liability for breach of fiduciary duties to the fullest extent permitted by
Delaware law;
|
•
|
subject to the rights of any outstanding series of preferred stock, the exclusive right of our Board, even if less than a
quorum, to fill newly created directorships resulting from an increase in the number of directors and any vacancies on the Board resulting from death, resignation, retirement, disqualification, removal or any other cause, each to the
exclusion of stockholders’ ability to fill newly created directorships and vacancies;
|
•
|
the requirement that a special meeting of stockholders may be called exclusively by the Chairman of the Board, the Chief
Executive Officer, President or other executive officer, or by an action of our 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 board of directors and stockholder meetings;
|
•
|
the requirement for the affirmative vote of holders of at least two-thirds of the voting power of all of the then outstanding
shares of the voting stock, voting as a single class, to amend, alter, change or repeal any provision of our bylaws, which could inhibit the ability of an acquirer to effect such amendments to facilitate an unsolicited takeover attempt;
|
•
|
the ability of our Board to amend our bylaws, which may allow our Board to take additional actions to prevent an unsolicited
takeover and inhibit the ability of an acquirer to amend the bylaws to facilitate an unsolicited takeover attempt;
|
•
|
advance notice procedures with which stockholders must comply to nominate candidates to our Board and bring business before
stockholder meetings, which could delay changes in our 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 us; and
|
•
|
dividing our Board into three classes, Class I, Class II and Class III, with each class serving staggered terms, which could
delay changes in our 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 us.
|
•
|
You can vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope
provided. If you hold your shares in “street name” through a bank, broker or other nominee, you will need to follow the instructions provided to you by your bank, broker or other nominee to ensure that your shares are represented and
voted at the Special Meeting. If you vote by proxy card, your “proxy,” whose name is listed on the proxy card, will vote your shares as you instruct on the proxy card. If you sign and return the proxy card but do not give instructions
on how to vote your shares, your shares of Common Stock will be voted as recommended by the PACI Board. The PACI Board recommends voting “FOR” the BCA Proposal, “FOR” the Stock Issuance Proposal, “FOR” the Charter Amendment Proposal,
“FOR” the Stock Incentive Plan Proposal, and “FOR” the Adjournment Proposal.
|
•
|
You can attend the Special Meeting virtually and vote online even if you have previously voted by submitting a proxy pursuant
to any of the methods noted above. However, if your shares of Common Stock are held in the name of your broker, bank or other nominee, you must get a proxy from the broker, bank or other nominee. That is the only way we can be sure that
the broker, bank or nominee has not already voted your shares of Common Stock.
|
•
|
you may send another proxy card with a later date;
|
•
|
you may notify our secretary, in writing, before the Special Meeting that you have revoked your proxy; or
|
•
|
you may attend the Special Meeting virtually, revoke your proxy and vote online, as indicated above.
|
•
|
if you hold your Public Shares through units, 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;
|
•
|
certify to PACI whether you are acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act) with
any other stockholder with respect to shares of Common Stock;
|
•
|
prior to 5:00 p.m., Eastern Time, on , 2023 (two business days before the Special Meeting), tender your shares physically or
electronically and submit a request in writing that we redeem your Public Shares for cash to Continental Stock Transfer & Trust Company, our transfer agent, to the attention of at 1 State Street, 30th Floor, New York, New York
10004, by email at spacredemptions@continentalstock.com or by telephone at (212) 509-4000; and
|
•
|
deliver your Public Shares either physically or electronically through DTC to the transfer agent at least two business days
before the Special Meeting. Stockholders seeking to exercise their redemption rights and opting to deliver physical certificates should allot sufficient time to obtain physical certificates from the transfer agent and time to effect
delivery. It is our understanding that stockholders should generally allot at least two weeks to obtain physical certificates from the transfer agent. However, we do not have any control over this process and it may take longer than two
weeks. Stockholders who hold their shares in street name will have to coordinate with their bank, broker or other nominee to have the shares certificated or delivered electronically. If you do not submit a written request and deliver
your Public Shares as described above, your shares will not be redeemed.
|
•
|
make any proposal or offer that constitutes a BCA Proposal,
|
•
|
initiate, solicit, or engage in any negotiations with any Person with respect to, or provide any non-public information or
data concerning PACI to any Person relating to, a BCA Proposal or afford to any Person access to the business, properties, assets, or personnel of PACI in connection with a BCA Proposal,
|
•
|
enter into any acquisition agreement, business combination, merger agreement, or similar definitive agreement, or any letter
of intent, memorandum of understanding, or agreement in principle, or any other agreement, relating to a BCA Proposal,
|
•
|
otherwise knowingly encourage or facilitate any such inquiries, proposals, discussions, or negotiations or any effort or
attempt by any Person to make a BCA Proposal,
|
•
|
approve, endorse, or recommend, or propose to approve, endorse, or recommend, a BCA Proposal, or
|
•
|
agree or otherwise commit to enter into or engage in any of the foregoing, in each case, other than with any Party or any of
their Representatives.
|
•
|
Stock covered by awards granted under the 2021 Plan will be shares of Volato Class A common stock;
|
•
|
All references in the 2021 Plan to a number of shares of Volato, Inc. common stock will be amended to refer instead to that
number of shares of Volato Group common stock as adjusted by the Exchange Ratio, as defined in the Business Combination Agreement;
|
•
|
Employees and consultants of Volato (or any other affiliate of Volato) shall be eligible to receive awards under the 2021
Plan;
|
•
|
The Compensation Committee, subject to PACI Board oversight, will succeed to the authority and responsibility of the Volato,
Inc. board or a committee of the Volato, Inc. board with respect to the administration of the 2021 Plan; and
|
•
|
Certain other minor technical revisions may also be made.
|
•
|
the absence of any governmental order, statute, rule or regulation enjoining or prohibiting the consummation of the business
combination;
|
•
|
the completion of the Information Statement (as defined in the Business Combination Agreement) in accordance with the
Business Combination Agreement, the PACI organizational documents and the Proxy Statement;
|
•
|
receipt of PACI stockholder approval and certain Volato Stockholder approvals; and
|
•
|
the approval for listing of the Volato Group Common Stock on the NYSE subject only to official notice of issuance thereof.
|
•
|
each of the representations and warranties of Volato being true and correct to applicable standards and each of the covenants
of Volato having been performed or complied with in all material respects (including, without limitation, adoption by PACI of the 2021 Plan and the 2023 Plan);
|
•
|
PACI’s receipt of an officer’s certificate of Volato certifying that such representations and warranties are true and correct
and such covenants have been performed and complied with; and
|
•
|
the execution and delivery of certain ancillary agreements.
|
•
|
each of the representations and warranties of PACI and Merger Sub being true and correct to applicable standards and each of
the covenants of PACI and Merger Sub having been performed or complied with in all material respects;
|
•
|
Volato’s receipt of officer’s certificates of PACI and Merger Sub certifying such representations and warranties are true and
correct and such covenants have been performed and complied with;
|
•
|
the amendment and restatement of PACI’s certificate of incorporation in the form of the Proposed Charter; and
|
•
|
the execution and delivery of certain ancillary agreements.
|
(i)
|
by mutual written consent of PACI and Volato;
|
(ii)
|
prior to the Closing, by written notice by either PACI or Volato if the other party has breached its representations,
warranties, covenants or agreements in the Business Combination Agreement such that the conditions to Closing cannot be satisfied and such breach cannot be cured within certain specified time periods; provided that the terminating party
is not then in material breach of its representation, warranties, covenants or agreements under the Business Combination Agreement;
|
(iii)
|
prior to the Closing, by written notice by either PACI or Volato if the Business Combination is not consummated on or before
December 1, 2023;
|
(iv)
|
prior to the Closing, by written notice by either PACI or Volato if the consummation of the Business Combination is
permanently enjoined or prohibited by the terms of a final, non-appealable governmental order or a statue, rule or regulation;
|
(v)
|
by either PACI or Volato if PACI stockholders do not approve the Business Combination Agreement at the Special Meeting held
for that purpose; or
|
(vi)
|
by PACI if there has been a Change in Recommendation (as defined the Business Combination Agreement).
|
•
|
public research on industry trends and other industry and macroeconomic factors;
|
•
|
extensive meetings, calls and video conferences with Volato’s management team, representatives, and key supplier regarding
operations, and financial prospects, among other customary due diligence matters;
|
•
|
review of Volato’s material business including corporate books and records, customer contracts and potential customer
pipeline, vendor contracts, information technology and certain other safety, legal and environmental due diligence; and
|
•
|
financial and accounting diligence.
|
•
|
Volato’s ability to raise $35,000,000 of new capital, net of transaction expenses;
|
•
|
Volato’s acceptance of aircraft delivery within anticipated timeframes;
|
•
|
Volato’s ability to sell the aircraft upon delivery;
|
•
|
Volato’s ability to source and secure additional aircraft from the secondary market;
|
•
|
Increased flight hours and ability to utilize empty legs;
|
•
|
Volato’s ability to crew the fleet by continuing to attract and retain qualified pilots;
|
•
|
Increased revenues from efficient software (in-development); and
|
•
|
Continued increase in gross margins.
|
|
| |
FY 2023
|
| |
FY 2024
|
| |
FY 2025
|
| |
FY 2026
|
| |
FY 2027
|
Total Revenue
|
| |
136,899,214
|
| |
452,272,765
|
| |
470,187,315
|
| |
592,128,554
|
| |
739,458,440
|
EBITDA
|
| |
(24,577,245)
|
| |
26,294,957
|
| |
36,493,057
|
| |
55,191,984
|
| |
93,353,134
|
Depreciation & Amortization
|
| |
213,198
|
| |
268,780
|
| |
260,278
|
| |
96,575
|
| |
20,166
|
Capital Expenditures
|
| |
(851,109)
|
| |
(1,001,206)
|
| |
(992,704)
|
| |
(829,001)
|
| |
(752,592)
|
Net Change in Working Capital
|
| |
(12,585,819)
|
| |
44,034,360
|
| |
14,183,259
|
| |
18,056,524
|
| |
3,635,716
|
•
|
reviewed a draft, dated July 26, 2023, of the Business Combination Agreement;
|
•
|
reviewed certain publicly available business and financial information and other data relating to PACI and Volato that LSH
deemed to be relevant;
|
•
|
reviewed certain information relating to the historical, current and future operations, financial condition and prospects of
Volato made available to LSH by Volato and PACI, including financial projections prepared by the management of Volato relating to Volato;
|
•
|
held discussions with certain members of the management of PACI and of Volato and certain of their respective representatives
and advisors regarding the business, operations, financial condition and prospects of Volato and related matters;
|
•
|
reviewed publicly available information with respect to certain other companies in lines of business LSH believed to be
generally relevant in evaluating the business of Volato; and
|
•
|
conducted such other financial studies, analyses and investigations as LSH deemed appropriate.
|
Announcement Date
|
| |
Target
|
| |
Acquirer
|
February 24, 2023
|
| |
Jet Token
|
| |
Oxbridge Acquisition Corp (Pending)
|
October 17, 2022
|
| |
flyExclusive
|
| |
Eg Acquisition Corp (Pending)
|
August 4, 2022
|
| |
Atlas Air Worldwide Holdings, Inc.
|
| |
Apollo Global Management; JF Lehman & Co.
|
July 15, 2022
|
| |
National Jet Express Pty Ltd.(1)
|
| |
Rex Freight & Charter Pty Ltd.
|
May 19, 2022
|
| |
Monacair SAM(1)
|
| |
Blade Europe SAS
|
March 3, 2022
|
| |
Southern Jet, Inc.(1)
|
| |
Jet Linx Aviation LLC
|
February 21, 2022
|
| |
Air Hamburg
|
| |
Vista Global Holding Ltd.
|
February 3, 2022
|
| |
Alante Air Charter LLC(1)
|
| |
Wheels Up Experience, Inc.
|
January 27, 2022
|
| |
Air Partner Plc
|
| |
Wheels Up Experience, Inc.
|
September 9, 2021
|
| |
Trinity Air Medical, Inc.
|
| |
Blade Urban Air Mobility, Inc.
|
August 10, 2021
|
| |
Línea Aérea Amaszonas SA(1)
|
| |
Nella Linhas Aereas Ltda.
|
July 5, 2021
|
| |
Carson Air Ltd.(1)
|
| |
Exchange Income Corp.
|
June 7, 2021
|
| |
Atlantic Aviation(1)
|
| |
KKR; Corporacion Financiera Alba
|
March 4, 2021
|
| |
Apollo Jets LLC(1)
|
| |
Vista Global Holding Ltd.
|
February 1, 2021
|
| |
Wheels Up Partners Holdings LLC(2)
|
| |
Aspirational Consumer Lifestyle Corp.
|
December 15, 2020
|
| |
Blade Urban Air Mobility, Inc.(2)
|
| |
Experience Investment Corp.
|
Announcement Date
|
| |
Target
|
| |
Acquirer
|
October 24, 2019
|
| |
Critical Care Medflight(1)
|
| |
Medway Air Ambulance
|
May 14, 2019
|
| |
Elliott Aviation, Inc.(1)
|
| |
Jet Linx Aviation LLC
|
April 10, 2018
|
| |
JetSuite, Inc.(1)
|
| |
Government of Qatar; Qatar Airways Group
|
September 20, 2018
|
| |
XOJET, Inc.(1)
|
| |
Vista Global Holding Ltd.
|
October 31, 2017
|
| |
HNZ Group, Inc.
|
| |
PHI, Inc.; HNZ Management
|
March 14, 2017
|
| |
Air Methods Corp.
|
| |
American Securities LLC
|
March 8, 2017
|
| |
Discovery Air, Inc.
|
| |
Clairvest Group, Inc.; Discovery Air
|
November 28, 2016
|
| |
Anoka Airport Development LLC(1)
|
| |
Lynx FBO Destin LLC
|
September 14, 2016
|
| |
Key Air LLC(1)
|
| |
Clay Lacy Aviation, Inc.
|
January 19, 2016
|
| |
Southern Air Holdings
|
| |
Atlas Air Worldwide Holdings, Inc.
|
Low EV / LTM Revenue
|
| |
0.5x
|
Median EV / LTM Revenue
|
| |
1.5x
|
Mean EV / LTM Revenue
|
| |
3.0x
|
High EV / LTM Revenue
|
| |
14.3x
|
|
| |
|
Low EV / LTM Revenue (excluding Wheels Up & Blade Urban
Air)(2)
|
| |
0.5x
|
Median EV / LTM Revenue (excluding Wheels Up & Blade
Urban Air)(2)
|
| |
1.3x
|
Mean EV / LTM Revenue (excluding Wheels Up & Blade Urban
Air)(2)
|
| |
1.7x
|
High EV / LTM Revenue (excluding Wheels Up & Blade Urban
Air)(2)
|
| |
4.8x
|
(1)
|
The information required to calculate EV / LTM Revenue multiple for this transaction was unavailable and therefore this
transaction was not included in the low to high EV / LTM Revenue multiples and the median and mean EV / LTM Revenue multiples.
|
(2)
|
LSH noted that the transactions involving Wheels Up Partners Holdings LLC and Blade Urban Air Mobility, Inc. implied higher
revenue multiples relative to the other selected precedent transactions. As Wheels Up Partners Holdings LLC and Blade Urban Air Mobility, Inc. shares have performed poorly subsequent to their acquisitions, down approximately 98% and
50%, respectively, while the S&P 500 rose approximately 21% since January 1, 2021, LSH also considered the low to high EV / LTM Revenue multiples and the median and mean EV / LTM Revenue multiples excluding those transactions. The
low to high EV / LTM Revenue multiples excluding those transactions were 0.5x to 4.8x, and the median and mean EV / LTM Revenue multiples excluding those transactions were 1.3x and 1.7x, respectively.
|
•
|
Charter/Private Airlines:
|
○
|
Exchange Income Corporation
|
○
|
Air Transport Services Group, Inc.
|
○
|
Chorus Aviation Inc.
|
○
|
Abu Dhabi Aviation
|
○
|
Alliance Aviation Services Limited
|
○
|
Blade Air Mobility, Inc.
|
○
|
Wheels Up Experience Inc.
|
•
|
Commercial Airlines with a Membership Program:
|
○
|
Delta Air Lines, Inc.
|
○
|
American Airlines Group Inc.
|
○
|
United Airlines Holdings, Inc.
|
○
|
Deutsche Lufthansa AG
|
○
|
Singapore Airlines Ltd.
|
○
|
Air France-KLM SA
|
○
|
JetBlue Airways Corporation
|
•
|
Business Jet Manufacturers:
|
○
|
General Dynamics Corporation
|
○
|
Textron Inc.
|
○
|
Embraer S.A.
|
|
| |
EV / 2023E Revenue
|
|||||||||
|
| |
Low
|
| |
Median
|
| |
Mean
|
| |
High
|
Charter/Private Airlines
|
| |
0.8x
|
| |
1.5x
|
| |
1.5x
|
| |
2.0x
|
Commercial Airlines with a Membership Program
|
| |
0.3x
|
| |
0.6x
|
| |
0.6x
|
| |
0.9x
|
Business Jet Manufacturers
|
| |
0.8x
|
| |
1.1x
|
| |
1.2x
|
| |
1.7x
|
•
|
estimating the weighted average cost of capital of 11.0% to 13.0% by analyzing select private charter aviation companies’
betas, capital structures, and costs of equity employing the capital asset pricing model;
|
•
|
calculating the present value, as of December 31, 2023, of the estimated unlevered free cash flows (calculated as EBITDA
(defined as earnings before interest, taxes, depreciation and amortization), less taxes (calculated by applying an assumed tax rate of 30.0% to earnings before interest and taxes), less capital expenditures, plus the net change in
working capital) that Volato could generate for the calendar years 2024 through 2027 using discount rates ranging from 11.0% to 13.0% based on estimates of the weighted average cost of capital of Volato; and
|
•
|
adding terminal values calculated using a long term earnings multiple methodology, with the terminal value calculated by
applying a selected range of terminal value EBITDA multiples of 4.0x to 5.0x, based on LSH’s professional judgment and experience, to the year ending December 31, 2027 estimated EBITDA of Volato and discounting the terminal values
derived from the application of these methodologies to present value as of December 31, 2023, using discount rates ranging from 11.0% to 13.0% based on estimates of the weighted average cost of capital of Volato.
|
•
|
the fact that our Sponsor may convert any working capital loans that it may make to us into up to an additional 1,500,000
warrants at the price of $1.00 per warrant;
|
•
|
the fact that our Sponsor, the PROOF.vc SPV, and our officers and directors have agreed not to redeem any Public Shares held
by them in connection with a stockholder vote to approve the Business Combination;
|
•
|
the fact that our Sponsor paid $25,000 for the Founder Shares and that such securities will have a significantly higher value
at the time of the Business Combination, which if unrestricted and freely tradable would be valued at approximately $ , based on the closing price of our Class A Common Stock of $ per share on , 2023, the record date for the
Special Meeting, resulting in a theoretical gain of $ ;
|
•
|
the fact that certain of PACI’s officers and directors collectively own, directly or indirectly, a material interest in our
Sponsor and may also be limited partners of the PROOF.vc SPV, which has an investment in our Sponsor;
|
•
|
the anticipated appointment of to the Volato Group Board in connection with the closing of the Business Combination;
|
•
|
the fact that the members of our Sponsor and the PROOF.vc SPV will benefit from the completion of a Business Combination and
may be incentivized to complete an acquisition of a less favorable target company or on terms less favorable to stockholders rather than liquidate;
|
•
|
the fact that the members of our Sponsor and its affiliates the PROOF.vc SPV can earn a positive rate of return on their
investment, even if other PACI stockholders experience a negative rate of return in the post-business combination company;
|
•
|
the fact that our officers and directors will be reimbursed for out-of-pocket expenses incurred in connection with activities
on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations;
|
•
|
the fact that our Sponsor, officers and directors will lose their entire investment in us if an initial business combination
is not completed;
|
•
|
the fact that our Sponsor and the PROOF.vc SPV entered into a Series A Preferred Stock Purchase Agreement with Volato with
regard to the Private Financing (as described in the “Interests of the Volato Related Parties in the Business Combination” section below) and will continue to own Series A Preferred Stock in Volato even if the Business Combination with
Volato is not consummated; and
|
•
|
the fact that, pursuant to the terms of the Private Financing arrangement as well as the Sponsor Support Agreement, our
Sponsor is required to vote in favor of the Business Combination.
|
•
|
the fact that, at the closing of the Business Combination, each of Matthew Liotta, Nicholas Cooper, Keith Rabin, Michael
Prachar, and Steven Drucker will enter into employment agreements which entitle them to certain contractual benefits and economic incentives;
|
•
|
the anticipated appointment of each of Matthew Liotta, Nicholas Cooper, Joan Sullivan Garrett, Michael Nichols and Robert
George, as directors on the Volato Group Board in connection with the closing of the Business Combination;
|
•
|
the fact that executive officers of Volato will have the ability to earn up to an additional 10% of the total equity of
Volato Group for no additional capital contribution pursuant to the 2023 Plan; and
|
•
|
the fact that certain of Volato’s officers and directors will collectively own, directly or indirectly, a material interest
in the Volato Group at the Closing of the Business Combination equal to approximately 39.00% of the voting interests.
|
•
|
Under the Minimum and Maximum Redemption Scenarios, legacy Volato stockholders will have a majority of the voting interest in
Volato Group with approximately 57.4% and 72.3%, respectively, of the voting interest.
|
•
|
The senior management of Volato Group will be comprised of individuals from Volato as further described below.
|
•
|
The largest single stockholder of Volato Group will be a legacy stockholder of Volato.
|
•
|
Volato will designate a majority of the governing body of Volato Group.
|
•
|
An individual from Volato will be designated as the chairman of the governing body of Volato Group and the Chief Executive
Officer of Volato Group and a second individual from Volato will be designated as the Chief Financial Officer of Volato Group and the remaining members of senior management of Volato Group will be comprised entirely of individuals from
Volato.
|
•
|
Volato’s operations will comprise the ongoing operations of Volato Group.
|
•
|
change PACI’s name to “Volato Group, Inc.”;
|
•
|
change the total number of authorized shares of all classes of capital stock, par value $0.0001 per share, from 83,500,000
shares, consisting of 82,500,000 shares of Common Stock, including 70,000,000 shares of Class A Common Stock and 12,500,000 shares of Class B Common Stock, and 1,000,000 shares of Preferred Stock, to 81,000,000 shares, consisting of
80,000,000 shares of Class A Common Stock, par value $0.0001 per share, and 1,000,000 shares of Preferred Stock, par value $0.0001 per share; and
|
•
|
eliminate certain provisions specific to PACI’s status as a blank check company.
|
•
|
the name of the new public entity is desirable to reflect the nature of the business to be conducted by the post-transaction
entity and its brand;
|
•
|
the greater number of authorized shares of Class A Common Stock is desirable for PACI to have sufficient shares to complete
the Business Combination and have additional authorized shares for financing its business, for acquiring other businesses, for forming strategic partnerships and alliances and for stock dividends and stock splits; and
|
•
|
the provisions that relate to the operation of PACI as a blank check company prior to the consummation of its initial
Business Combination will not be applicable to Volato Group (such as the obligation to dissolve and liquidate if a business combination is not consummated in a certain period of time).
|
•
|
Prudent Share Request and Efficient Use of Equity. Under the terms of the
2023 Plan, no more than 20% of the issued and outstanding shares of our Class A Common Stock as of the date of Closing will be authorized for issuance under the plan (subject to adjustment for anti-dilution purposes). We are committed
to the efficient use of equity awards and are mindful to ensure that our equity compensation program does not overly dilute our existing stockholders. To that end, the Compensation Committee will consider potential stockholder dilution,
including burn rate and overhang, in the design and administration of equity awards.
|
•
|
Independent Committee. The 2023 Plan will be administered by the Compensation
Committee. All members of the Compensation Committee are intended to qualify as “independent” under the NYSE listing standards and as “non-employee directors” under Rule 16b-3 adopted under the Exchange Act.
|
•
|
No Discounted Stock Options or SARs and Limit on Option and SAR Terms. Stock
options and stock appreciation rights, or SARs, must have an exercise price or base price, as applicable, equal to or greater than the fair market value (which is generally defined to be the closing sale price on the trading day
immediately preceding the date of grant) of our Class A Common Stock on the date of grant. In addition, the term of an option or SAR cannot exceed 10 years.
|
•
|
No Annual “Evergreen” Provision. The 2023 Plan requires stockholder approval
of any additional authorization of shares (other than adjustments for anti-dilution purposes) and does not permit an annual replenishment of shares under a plan “evergreen” provision.
|
•
|
No Stock Option or SAR Repricings Without Stockholder Approval. The 2023 Plan
prohibits the repricing of stock options or SARs without the approval of stockholders. This 2023 Plan provision applies to (i) direct repricings (lowering the exercise price of an option or the base price of an SAR), (ii) indirect
repricings (exchanging an outstanding option or SAR that is under water for cash, for options or SARs with an option price or base price less than that applicable to the original option or SAR, or for another equity award) and (iii) any
other action that would be treated as a repricing under applicable stock exchange rules (subject to anti-dilution adjustments).
|
•
|
Robust Minimum Vesting Requirements for stock-based awards. The 2023 Plan
generally imposes a minimum vesting period of one year for Stock Options, SARs and other stock-based awards other than in the cases of death, disability, retirement or a change in control. The Administrator may provide for the grant of
awards with shorter or no vesting periods but only with respect to awards covering no more than five percent of the shares authorized for issuance under the 2023 Plan and in certain other limited circumstances. We believe that our
vesting and award practices are responsible and further our incentive and retention objectives.
|
•
|
No Automatic “Single Trigger” Vesting Upon Change of Control. The 2023 Plan
provides for double trigger treatment of awards upon a Change of Control and does not provide for automatic “single trigger” change of control vesting. Specifically, awards will vest upon a change of control only if (i) awards are not
assumed, substituted or continued, or (ii) when such awards are assumed, substituted or continued, only if a participant’s employment is terminated beginning six months before and ending one year after the change of control (or such
other period after a change of control as may be stated in a participant’s employment agreement, change in control agreement or similar agreement or arrangement, if applicable after the change of control) and only if such termination of
employment or service is without cause or for good reason. Notwithstanding the prior sentence, unless an individual award agreement expressly provides otherwise, in the event that a participant has entered into, or is a participant in,
an employment agreement, change of control agreement or plan or similar agreement, plan or arrangement with us, the participant will be entitled to the greater of the benefits provided upon a change of control under the 2023 Plan or the
respective employment agreement, change of control agreement or similar agreement, plan or arrangement, and such employment agreement, change of control agreement or similar agreement, plan or arrangement will not be construed to reduce
in any way the benefits otherwise provided to a participant upon the occurrence of a change of control as defined in the 2023 Plan.
|
•
|
Prudent Change of Control Provisions. The 2023 Plan includes prudent “change
of control” triggers such as requiring a change in beneficial ownership of more than 50% of our voting stock or other voting securities or consummation (rather than stockholder approval) of a merger or other transaction in which the
holders of our common stock or other voting securities immediately prior to the transaction have voting control over less than 50% of the voting securities of the surviving corporation immediately after such transaction in order for a
“change of control” to be deemed to have occurred.
|
•
|
Prohibition of Certain Share Recycling, or “Liberal Share Counting”, Practices for
Options and SARs. The 2023 Plan imposes conservative counting and share recycling provisions for awards. For instance, shares subject to awards that are tendered or withheld to satisfy tax withholding requirements, or
payment of an option or SAR exercise price or in connection with net settlement of an award will not be added back for reuse under the 2023 Plan, nor will any shares repurchased on the open market with the portion of the proceeds of an
option exercise that represents payment of the exercise price.
|
•
|
No Grants of “Reload” Awards. The 2023 Plan does not provide for “reload”
awards (the automatic substitution of a new award of like kind and amount upon the exercise of a previously granted award).
|
•
|
Forfeiture and Clawback. The 2023 Plan authorizes the Administrator to
require forfeiture and/or recoupment of plan benefits if a participant engages in certain types of detrimental conduct and to require that a participant be subject to any compensation recovery policy or similar policies that may apply
to the participant or be imposed under applicable laws.
|
•
|
No Dividends or Dividend Equivalents on Unearned Awards. Dividends and
dividend equivalents on awards issued under the 2023 Plan may only be paid if and to the extent the award has vested or been earned, and no dividends may be paid on shares that are subject to options or SARs.
|
•
|
Limits on Transferability of Awards. Unless permitted by the Administrator,
the 2023 Plan does not permit awards to be transferred for value or other consideration.
|
•
|
our sponsor or founder (or an officer, director, employee or affiliate thereof);
|
•
|
a government or agency or instrumentality thereof;
|
•
|
a tax-exempt entity.
|
•
|
a tax-qualified retirement plan or pension plan;
|
•
|
an S corporation, partnership, or other entity or arrangement treated as a partnership or other flow-through entity for U.S.
federal income tax purposes (and investors therein);
|
•
|
a dealer or trader in securities that uses a mark-to-market method of tax accounting with respect to the securities;
|
•
|
a regulated investment company;
|
•
|
a real estate investment trust;
|
•
|
a financial institution;
|
•
|
an insurance company;
|
•
|
a controlled foreign corporation or passive foreign investment company;
|
•
|
an expatriate or former long-term resident of the United States;
|
•
|
a person that actually or constructively owns 5% or more of our voting shares or 5% or more of the total value of our shares;
|
•
|
a person that acquired our shares pursuant to an exercise of employee share options, in connection with employee share
incentive plans or otherwise as compensation or in connection with services;
|
•
|
a person holding the shares as part of a hedge, straddle, constructive sale, or other risk reduction strategy or as part of a
conversion transaction or other integrated investment transaction;
|
•
|
a person subject to special tax accounting rules as a result of any item of gross income with respect to Public Shares being
taken into account in an applicable financial statement;
|
•
|
a person who elects to apply the provisions of Section 1400Z-2 of the Code to any gain realized;
|
•
|
a person holding our securities in connection with a trade or business outside the United States; or
|
•
|
a U.S. person whose functional currency is not the U.S. dollar.
|
•
|
an individual who is a citizen or resident of the United States;
|
•
|
a corporation (or other entity taxable as a corporation) organized in or under the laws of the United States, any state
thereof or the District of Columbia;
|
•
|
an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or
|
•
|
a trust (i) the administration of which is subject to the primary supervision of a U.S. court and which has one or more U.S.
persons (within the meaning of the Code) who have the authority to control all substantial decisions of the trust or (ii) that has in effect a valid election under applicable Treasury regulations to be treated as a U.S. person.
|
•
|
You are a “Non-U.S. Holder” if you are a beneficial owner of our Public Shares or Volato Common or Preferred Stock, as
applicable, and are for U.S. federal income tax purposes:
|
•
|
a non-resident alien individual;
|
•
|
a foreign corporation; or
|
•
|
an estate or trust that is not a U.S. Holder.
|
•
|
the gain is effectively connected with the conduct of a trade or business by you within the United States (and, if required
by an applicable income tax treaty, is attributable to a U.S. permanent establishment or fixed base maintained by you);
|
•
|
you are a nonresident alien individual present in the United States for 183 days or more during the taxable year of the
disposition and certain other requirements are met; or
|
•
|
our Public Shares constitute a U.S. real property interest (“USRPI”) by reason of our status as a “U.S. real property holding
corporation” (a “USRPHC”) for U.S. federal income tax purposes and, as a result, such gain is treated as effectively connected with a trade or business conducted by you in the United States.
|
•
|
meeting with our independent registered public accounting firm regarding, among other issues, audits, and the adequacy of our
accounting and control systems;
|
•
|
monitoring the independence of the independent registered public accounting firm;
|
•
|
verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit
partner responsible for reviewing the audit as required by law;
|
•
|
inquiring and discussing with management our compliance with applicable laws and regulations;
|
•
|
pre-approving all audit services and permitted non-audit services to be performed by our independent registered public
accounting firm, including the fees and terms of the services to be performed;
|
•
|
appointing or replacing the independent registered public accounting firm;
|
•
|
determining the compensation and oversight of the work of the independent registered public accounting firm (including
resolution of disagreements between management and the independent registered public accounting firm regarding financial reporting) for the purpose of preparing or issuing an audit report or related work;
|
•
|
establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal
accounting controls or reports which raise material issues regarding our financial statements or accounting policies;
|
•
|
monitoring compliance on a quarterly basis with the terms of the IPO and, if any noncompliance is identified, immediately
taking all action necessary to rectify such noncompliance or otherwise causing compliance with the terms of the IPO; and
|
•
|
reviewing and approving all payments made to our existing stockholders, executive officers or directors and their respective
affiliates. Any payments made to members of our audit committee will be reviewed and approved by our board of directors, with the interested director or directors abstaining from such review and approval.
|
•
|
identifying individuals qualified to become members of the board of directors and making recommendations to the board of
directors regarding nominees for election;
|
•
|
reviewing the independence of each director and making a recommendation to the board of directors with respect to each
director’s independence;
|
•
|
developing and recommending to the board of directors the corporate governance principles applicable to us and reviewing our
corporate governance guidelines at least annually;
|
•
|
making recommendations to the board of directors with respect to the membership of the audit, compensation and corporate
governance and nominating committees;
|
•
|
overseeing the evaluation of the performance of the board of directors and its committees on a continuing basis, including an
annual self-evaluation of the performance of the corporate governance and nominating committee;
|
•
|
considering the adequacy of our governance structures and policies, including as they relate to our environmental
sustainability and governance practices;
|
•
|
considering director nominees recommended by stockholders; and
|
•
|
reviewing our overall corporate governance and reporting to the board of directors on its findings and any recommendations.
|
•
|
should have demonstrated notable or significant achievements in business, education or public service;
|
•
|
should possess the requisite intelligence, education and experience to make a significant contribution to the board of
directors and bring a range of skills, diverse perspectives and backgrounds to its deliberations; and
|
•
|
should have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests
of the stockholders.
|
•
|
reviewing and approving corporate goals and objectives relevant to our CEO’s compensation, evaluating our CEO’s performance
in light of those goals and objectives, and setting our CEO’s compensation level based on this evaluation;
|
•
|
setting salaries and approving incentive compensation and equity awards, as well as compensation policies, for all other
officers who file reports of their ownership, and changes in ownership, of our common stock under Section 16(a) of the Exchange Act (the “Section 16 Officers”), as designated by our board of directors;
|
•
|
making recommendations to the board with respect to incentive compensation programs and equity-based plans that are subject
to board approval;
|
•
|
approving any employment or severance agreements with our Section 16 Officers;
|
•
|
granting any awards under equity compensation plans and annual bonus plans to our executive officers and the Section 16
Officers;
|
•
|
approving the compensation of our directors; and
|
•
|
producing an annual report on executive compensation for inclusion in our proxy statement, in accordance with applicable
rules and regulations.
|
1.
|
Improve yourself and those around you. Embrace opportunities to teach and discover. Lead with encouragement and praise.
|
2.
|
Listen with intent. Be engaged and curious while seeking to understand others.
|
3.
|
Have positive interactions. Strengthen relationships by being humble and approachable
|
4.
|
Be transparent. Foster an environment of trust and lasting relationships.
|
5.
|
Contribute and commit. Embrace the conflict of ideas. Participate and then fully support the decision.
|
•
|
The number of high-net-worth potential customers is growing. This growth has
resulted in an increased demand for exclusive and personalized travel experiences. According to the Global Wealth Report conducted by Credit Suisse, as of the end of 2021 there were 24.48 million U.S. millionaires. This number is
expected to rise by 13% to 27.66 by 2026. According to Forbes, the number of U.S. billionaires rose from 724 in 2021 to 735 in 2023.
|
•
|
The market of potential private flyers is under-penetrated. According to the New
York Times, referencing a study from McKinsey & Company, there are 100,000 regular private jet fliers in the United States, out of some 1.5 million people who could afford to charter a plane. The private jet market remains
under-penetrated. We believe factors like a superior owner and customer experience will add to the well-recognized benefits of increased productivity and convenience that private flying offers, in drawing new demand.
|
•
|
Highly regulated industry creates barriers to entry. The private aviation market is
complex and highly regulated, presenting barriers to scaling, therefore reducing competition, and decreasing price sensitivity. The industry is also subject to significant regulatory oversight by numerous federal agencies. However,
Volato’s business model fits well within this regulatory environment.
|
•
|
Commercial airline service is declining. North American passenger satisfaction with
regards to commercial aviation is in decline across all three segments—first/business, premium economy, and economy/basic economy—down more than 29 points from 2021 to 791 (on a 1,000-point scale). Passengers are responding negatively
to increases in cost, flight crew performance, passenger loads, delays, and communication.
|
•
|
The COVID-19 pandemic increased exposure to private aviation. This led to more
people experimenting with private aviation, increasing engagement with the category. This was fueled by lack of access to commercial travel, increased passenger sensitivity to traveling with unknown passengers, mask mandates, and
general delays. We expect interest in private aviation to continue to grow, with changes in how people work and live in a post-COVID pandemic environment bolstering foundational demand.
|
•
|
New business models are introducing more people to the benefits of flying private.
Semi-private carriers are introducing a new category of fliers to the benefits of private travel. These carriers provide access to smaller airports, offer reduced travel time, avoid checkpoints, and enable a less stressful customer
experience.
|
•
|
Static industry with little innovation presents opportunities. A lack of innovation
in the industry has contributed to low asset utilization, poor operational and commercial technology, high operational complexity, and antiquated commercial practices, all which stifle efficiency and scalability. This leads to a lack of
downward pressure on prices. Through Volato’s unique business model, Volato believes there are significant opportunities to take advantage of the growth in the market and its current lack of innovation, low customer satisfaction and
underutilization. Volato believes it has the understanding, knowledge, experience, and capability to effectively address these market opportunities.
|
•
|
The HondaJet is a revolutionary aircraft that combines superior performance, comfort, and efficiency. Its innovative design
features include a unique over-the-wing engine mount, natural laminar flow wing, and advanced flight deck technology.
|
•
|
The HondaJet’s compact size and superior performance make it ideal for business and personal travel, with a range of up to
1,400 nautical miles and a top speed of 422 knots. Its spacious cabin comfortably seats up to six passengers and offers a range of amenities, including a fully enclosed lavatory and Wi-Fi connectivity.
|
•
|
The HondaJet’s advanced safety features include an all-glass cockpit with state-of-the-art avionics, automatic stability
augmentation system, and enhanced flight vision system, making it one of the safest and most advanced light jets on the market
|
•
|
Does not provide the primary benefits of full aircraft ownership. Key benefits of
owning an aircraft are the same basic “bundle of rights” that come along with ownership of any property, including the rights of possession, control, and enjoyment. In a traditional fractional model, the owner must sacrifice both
control over how much it flies as well as enjoyment of revenue generated from the asset.
|
•
|
Hard for customers to forecast flight usage needs across multi-year programs.
Entitled hour programs require fractional owners to commit to an annual usage level for the length of the program. It is challenging for owners to forecast this accurately resulting in either owners overflying and requiring additional
hours that may not be available or only available at substantially increased prices, or under flying and the program being more expensive than originally forecast.
|
•
|
Depreciation only applicable for percentage of flights deemed business use. Many
traditional fractional program owners who use their program for a mix of business and leisure travel are often disappointed to learn they may only be eligible for bonus depreciation on the percentage of their total usage that is deemed
business use, and the leisure portion is not eligible. Additionally, if an aircraft owner’s use is primarily personal, no depreciation is available.
|
•
|
Lack of transparency into aircraft flight operations. In the traditional program,
fractional owners are often not provided detail into their aircraft’s flight operations, and it is generally not transparent how the aircraft is used or monetized outside of the fractional owner’s usage or if any of the owner benefit
from that associated revenue generation.
|
•
|
Fractional Owners traditionally accept operational control of their flights and the
liability and risk associated with operational control. Traditional fractional ownership programs require their owners to execute an acknowledgement of operational control, where the fractional owner agrees to accept liability
and risk associated with their flights operated under 14 C.F.R. Part 91(K).
|
•
|
Fractional owners participate in aircraft revenue share. Volato’s program
participants enjoy a revenue share from eligible Volato revenue flights. The revenue share is a set contracted amount per eligible occupied revenue-generating flight hour and is calculated and remitted monthly to each aircraft holding
SPE, which then distributes on a pro-rata basis to its members, the aircraft owners.
|
•
|
Unlimited flight hours regardless of fractional size. By decoupling ownership and
usage, and removing the concept of entitled hours, Volato’s HondaJet fractional owners can fly unlimited hours under the terms of the owner’s individual contracts with Volato’s air carrier subsidiary. A 1/16th owner can fly
as much or as little as they wish and is not limited by the size of their share.
|
•
|
Favorable tax treatment for owners. Due to the unique nature of Volato’s aircraft
ownership structure, Volato’s owners may be eligible for depreciation of their aircraft asset through their respective Plane Co LLC interests.
|
•
|
Volato’s unique program benefits influence purchase decision. Traditional programs
with entitled flight hours require customers to factor in anticipated flight hours into their fractional program purchase decisions. In contrast, we believe our owners are basing their purchase decisions based on anticipated flight
usage and their personal financial situation. Volato’s owners may buy a larger share based on their individual tax profile and depreciation benefits, or the larger revenue share they wish to receive as owners of larger shares enjoy
preferential hourly rates and receive a larger revenue share based on the percentage of the owned aircraft.
|
•
|
Transparency into Flight Operations. Volato’s software innovations allow for more
transparency into its flight operations by providing program participants detailed information on their aircraft’s commercial activities and maintenance status.
|
•
|
Transfer of Operational Control and Management. Under 14 C.F.R. Part 135, Volato
assumes operational control of aircraft it operates by way of a lease, which transfers responsibility for aircraft management and liability arising from the operation of the aircraft by Volato. In contrast, under Part 91K fractional
programs, the owners retain operational control of the aircraft and have potential liability exposure related to the aircraft operations.
|
•
|
Superior Operating Efficiency. The HondaJet’s design and performance profile mean it
is not just less expensive to operate but also matches the fuel economy of a turboprop, maintaining the speed and quietness of a jet without incurring extra fuel costs. This efficient operation enables Volato to offer cost savings to
customers while preserving the jet experience.
|
•
|
Superior Cabin Experience. The over-the-wing engine mount design of the HondaJet
decreases cabin noise, thus enhancing passenger comfort. Despite its smaller size, it provides a comfortable cabin and a larger luggage compartment compared to other jets in its category.
|
•
|
No Compromise. While the HondaJet HA-420 is rated for single-pilot operations, all
Volato HondaJet commercial passenger flights are operated with two pilots. This staffing includes safety and service benefits for our customers, while offering a more cost-effective solution.
|
•
|
Aircraft Sales Revenue. Volato sells aircraft to the LLC’s, and the aircraft are
subject to a 5-year leaseback to Volato. Volato believes that if it delivers on its brand and product promise then it should see a substantial renewal rate by program participants when the lease expires.
|
•
|
Monthly Management Fee. Program participants under Volato’s traditional pricing
structure pay a set monthly management fee, which is subject to an annual increase. Holders of smaller sizes (i.e., 1/8th and 1/16th) pay a premium. Program participants
under Volato’s low-use pricing structure do not pay a monthly management fee but pay a premium for their usage.
|
•
|
Usage Revenue. Program participants may book flights on the HondaJet fleet at
preferential hourly rates. Repositioning fees are waived for owner flights departing within an estimated two-hour flight time from select Volato bases. Fuel is separately charged to the owner at Volato’s blended cost. The total flight
charge is invoiced after the flight is completed.
|
![]() |
| |
![]() |
Figure: Flight reviews are output to a Microsoft Teams
channel that is open to the entire company.
|
| |
Figure: Aggregate NPS scores displayed in our proprietary Volato MissionControl
application.
|
![]() |
| |
![]() |
•
|
Since Volato’s inception, the company has been focused on making the necessary investments in people, focused acquisitions,
aircraft and technology to build an industry leading aviation company that uses capital efficiently.
|
•
|
Revenue decreased by $18.0 million, or 39%, compared to the six months ended June 30, 2022. Revenue from Plane Co membership
interest sales and whole aircraft sales decreased by $30.4 million, or 84%, and revenue from aircraft management and chartered flight services increased by $12.3 million, or 116%, during the six months June 30, 2022;
|
•
|
We had 5,735 total flight hours for the six months ended June 30, 2023, representing over 100% year-over-year growth;
|
•
|
Adjusted EBITDA decreased by $15.0 million, to adjusted negative EBITDA of $16.1 million;
|
•
|
We incurred a net loss of $17.4 million, representing a $16.0 million increase in loss over the prior year related to lower
sales of Plane Co membership interest sales and increased costs related to rapid scaling of the business.
|
•
|
Volato generated revenue of $95.7 million, representing 9,058% year-over-year growth, including growth from Plane Co
membership interest sales and acquisitions consummated during 2022;
|
•
|
We had 6,986 total flight hours representing over 1000%, year-over-year growth;
|
•
|
Adjusted EBITDA decreased by $7.0 million this year, to adjusted negative EBITDA of $8.4 million;
|
•
|
We incurred a net loss of $9.4 million, representing a $7.9 million increase in loss over the prior year.
|
•
|
We calculate Adjusted EBITDA as net loss adjusted for (i) interest income (expense), (ii) income tax expenses (iii)
depreciation and amortization, (iv) equity-based compensation expense, (v) acquisition, integration, and capital raise related expenses, and (v) other items not indicative of our ongoing operating performance. We include Adjusted EBITDA
as a supplemental measure for assessing operating performance.
|
Adjusted EBITDA
|
| |
Three Months Ended
June 30,
|
| |
Sixth Months Ended
June 30,
|
| |
Year Ended
December 31,
|
|||||||||
|
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
| |
2022
|
| |
2021
|
||
(in thousands)
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Net loss
|
| |
$(9,859,573)
|
| |
$(1,747,231)
|
| |
$(17,37,354)
|
| |
$(1,422,406)
|
| |
$(9,366,932)
|
| |
$(1,473,327)
|
Interest income
|
| |
(7,752)
|
| |
—
|
| |
(13,970)
|
| |
(44)
|
| |
(2,281)
|
| |
—
|
Interest expense
|
| |
735,844
|
| |
136,147
|
| |
1,636,071
|
| |
246,712
|
| |
868,336
|
| |
57,911
|
Income tax benefit
|
| |
—
|
| |
(3,791)
|
| |
—
|
| |
(80,000)
|
| |
(55,000)
|
| |
—
|
Depreciation
|
| |
57,046
|
| |
28,056
|
| |
102,027
|
| |
91,108
|
| |
161,667
|
| |
26,243
|
Acquisition, integration, and capital raise related
expenses(1)
|
| |
—
|
| |
323
|
| |
—
|
| |
20,791
|
| |
20,892
|
| |
|
Other items not indicative of our ongoing operating
performance(2)
|
| |
60,000
|
| |
—
|
| |
$(447,000)
|
| |
—
|
| |
—
|
| |
—
|
Adjusted EBITDA
|
| |
$(9,134,435)
|
| |
$(1,586,496)
|
| |
$(16,097,226)
|
| |
$(1,143,839)
|
| |
$(8,373,318)
|
| |
$(1,389,173)
|
(1)
|
Acquisition expenses associated with Gulf Coast Aviation.
|
(2)
|
Represents gain on sale of Fly Dreams certificate and fuel credit from litigation settlement.
|
|
| |
Three Months Ended
June 30
|
| |
Change In
|
||||||
|
| |
2023
|
| |
2022
|
| |
$
|
| |
%
|
Revenue
|
| |
$13,014
|
| |
$18,298
|
| |
$(5,284)
|
| |
(29%)
|
Costs and Expense
|
| |
|
| |
|
| |
|
| |
|
Cost of revenue
|
| |
16,848
|
| |
17,482
|
| |
(634)
|
| |
(4%)
|
Salaries and benefits
|
| |
3,054
|
| |
1,412
|
| |
1,642
|
| |
116%
|
Advertising expenses
|
| |
354
|
| |
76
|
| |
278
|
| |
366%
|
Professional fees
|
| |
371
|
| |
292
|
| |
79
|
| |
27%
|
General and administrative
|
| |
1,609
|
| |
701
|
| |
908
|
| |
130%
|
Depreciation
|
| |
57
|
| |
28
|
| |
29
|
| |
104%
|
Total cost and expense
|
| |
22,293
|
| |
19,991
|
| |
2,302
|
| |
12%
|
Loss from operation
|
| |
(9,279)
|
| |
(1,693)
|
| |
(7,586)
|
| |
448%
|
Gain from sale of Part 135 Certificate
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Gain from sale of equity method investment
|
| |
20
|
| |
—
|
| |
20
|
| |
100%
|
Gain from deconsolidation of investments
|
| |
—
|
| |
60
|
| |
(60)
|
| |
(100%)
|
Income (loss) from equity-method investments
|
| |
—
|
| |
(11)
|
| |
11
|
| |
100%
|
Other income
|
| |
127
|
| |
29
|
| |
98
|
| |
338%
|
Interest income on restricted cash
|
| |
8
|
| |
—
|
| |
8
|
| |
100%
|
Provision for income tax benefit
|
| |
—
|
| |
4
|
| |
(4)
|
| |
(100%)
|
Interest expense
|
| |
736
|
| |
(136)
|
| |
(600)
|
| |
441%
|
Net (Loss) Income
|
| |
$(9,860)
|
| |
$(1,747)
|
| |
$(8,113)
|
| |
464%
|
|
| |
Three Months Ended
June 30,
|
| |
Change In
|
||||||
|
| |
2023
|
| |
2022
|
| |
$
|
| |
%
|
Charter flight revenue
|
| |
$8,110
|
| |
$3,773
|
| |
$4,337
|
| |
115%
|
Aircraft management
|
| |
4,904
|
| |
3,500
|
| |
1,404
|
| |
40%
|
Aircraft sales
|
| |
—
|
| |
11,025
|
| |
(11,025)
|
| |
(100%)
|
Total
|
| |
$ 13,014
|
| |
$ 18,298
|
| |
$(5,284)
|
| |
(29%)
|
|
| |
Six Months Ended
June 30,
|
| |
Change In
|
||||||
|
| |
2023
|
| |
2022
|
| |
$
|
| |
%
|
Revenue
|
| |
$28,680
|
| |
$46,715
|
| |
$(18,035)
|
| |
(39%)
|
Costs and Expense
|
| |
|
| |
|
| |
|
| |
|
Cost of revenue
|
| |
34,852
|
| |
44,372
|
| |
(9,520)
|
| |
(21%)
|
Salaries and benefits
|
| |
5,634
|
| |
2,062
|
| |
3,572
|
| |
173%
|
Advertising expenses
|
| |
577
|
| |
136
|
| |
441
|
| |
324%
|
Professional fees
|
| |
881
|
| |
507
|
| |
374
|
| |
74%
|
General and administrative
|
| |
3,381
|
| |
1,412
|
| |
(1,969)
|
| |
139%
|
Depreciation
|
| |
102
|
| |
91
|
| |
11
|
| |
12%
|
Total cost and expense
|
| |
45,427
|
| |
48,580
|
| |
(3,153)
|
| |
(6%)
|
Loss from operation
|
| |
(16,747)
|
| |
(1,865)
|
| |
(14,882)
|
| |
798%
|
Gain from sale of Part 135 Certificate
|
| |
387
|
| |
—
|
| |
387
|
| |
100%
|
Gain from sale of equity method investment
|
| |
440
|
| |
—
|
| |
440
|
| |
100%
|
Gain from deconsolidation of investments
|
| |
—
|
| |
581
|
| |
(581)
|
| |
(100%)
|
Income (loss) from equity-method investments
|
| |
22
|
| |
(34)
|
| |
56
|
| |
(165%)
|
Other income
|
| |
146
|
| |
30
|
| |
116
|
| |
387%
|
Interest income on restricted cash
|
| |
14
|
| |
—
|
| |
14
|
| |
100%
|
Provision for income tax benefit
|
| |
—
|
| |
80
|
| |
(80)
|
| |
(100%)
|
Net income attributable to non-controlling interest
|
| |
—
|
| |
33
|
| |
(33)
|
| |
(100%)
|
Interest expense
|
| |
(1,636)
|
| |
(247)
|
| |
(1,389)
|
| |
562%
|
Net (Loss) Income
|
| |
$(17,374)
|
| |
$(1,422)
|
| |
$(15,952)
|
| |
1,122%
|
|
| |
Sixth Months Ended
June 30,
|
| |
Change In
|
||||||
|
| |
2023
|
| |
2022
|
| |
$
|
| |
%
|
Charter flight revenue
|
| |
$13,997
|
| |
$5,856
|
| |
$8,141
|
| |
139%
|
Aircraft management
|
| |
8,973
|
| |
4,784
|
| |
4,189
|
| |
88%
|
Aircraft sales
|
| |
5,710
|
| |
36,075
|
| |
(30,365)
|
| |
(84%)
|
Total
|
| |
$28,680
|
| |
$46,715
|
| |
$(18,035)
|
| |
(39%)
|
|
| |
Year Ended
December 31,
|
| |
Change In
|
||||||
|
| |
2022
|
| |
2021
|
| |
$
|
| |
%
|
Revenue
|
| |
$96,706
|
| |
$1,056
|
| |
$95,650
|
| |
9,058%
|
Costs and expenses
|
| |
|
| |
|
| |
|
| |
|
Cost of revenue
|
| |
94,280
|
| |
853
|
| |
93,427
|
| |
10,953%
|
Salaries and benefits
|
| |
5,878
|
| |
862
|
| |
5,016
|
| |
582%
|
Advertising expenses
|
| |
405
|
| |
388
|
| |
17
|
| |
4%
|
Professional fees
|
| |
1,168
|
| |
336
|
| |
832
|
| |
248%
|
General and administrative
|
| |
3,998
|
| |
786
|
| |
3,212
|
| |
409%
|
Depreciation
|
| |
161
|
| |
26
|
| |
135
|
| |
519%
|
Total cost and expenses
|
| |
105,890
|
| |
3,251
|
| |
102,639
|
| |
3,157%
|
Loss from operations
|
| |
(9,184)
|
| |
(2,195)
|
| |
(6,989)
|
| |
318%
|
Gain from deconsolidation of investments
|
| |
581
|
| |
758
|
| |
(177)
|
| |
(23%)
|
Loss from equity method investments
|
| |
(45)
|
| |
(12)
|
| |
(33)
|
| |
275%
|
Other income
|
| |
60
|
| |
—
|
| |
60
|
| |
100%
|
Interest income
|
| |
2
|
| |
—
|
| |
2
|
| |
100%
|
Provision for income tax benefit
|
| |
55
|
| |
—
|
| |
(55)
|
| |
100%
|
Net loss attributable to non-controlling interest
|
| |
33
|
| |
34
|
| |
(1)
|
| |
(4%)
|
Interest expense
|
| |
(868)
|
| |
(58)
|
| |
(810)
|
| |
1,397%
|
Net Loss
|
| |
$(9,367)
|
| |
$(1,473)
|
| |
$(7,894)
|
| |
536%
|
|
| |
Year Ended
December 31,
|
| |
Change In
|
||||||
|
| |
2022
|
| |
2021
|
| |
$
|
| |
%
|
Charter flight revenue
|
| |
$16,027
|
| |
$856
|
| |
$15,171
|
| |
1,772%
|
Aircraft management
|
| |
12,984
|
| |
200
|
| |
12,784
|
| |
6,392%
|
Aircraft sales
|
| |
67,695
|
| |
—
|
| |
67,695
|
| |
100%
|
Total
|
| |
$96,706
|
| |
$1,056
|
| |
$95,650
|
| |
9,058%
|
|
| |
Six Months Ended
June 30,
|
| |
Year Ended
December 31,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2022
|
| |
2021
|
Net cash used in operating activities
|
| |
$(13,255,505)
|
| |
$(4,013,320)
|
| |
$(21,432,330)
|
| |
$(3,608,314)
|
Net cash provided by (used in) investing activities
|
| |
1,705,256
|
| |
5,228,635
|
| |
5,145,056
|
| |
(11,814,626)
|
Net cash provided by financing activities
|
| |
11,158,326
|
| |
2,469,753
|
| |
22,557,773
|
| |
17,031,124
|
Net Increase (Decrease) In Cash and Cash Equivalents
|
| |
$(391,923)
|
| |
$3,685,068
|
| |
$6,270,499
|
| |
$1,608,184
|
1.
|
Identification of the contract, or contracts, with a customer.
|
2.
|
Identification of the performance obligation(s) in the contract.
|
3.
|
Determination of the transaction price.
|
4.
|
Allocation of the transaction to the performance obligation(s) in the contract.
|
5.
|
Recognition of revenue when, or as the Company satisfies a performance obligation.
|
•
|
Class I comprised of two individuals whose terms will expire at Volato Group’s first annual meeting of stockholders to be
held after the completion of the Business Combination;
|
•
|
Class II comprised of two individuals whose terms will expire at Volato Group’s second annual meeting of stockholders to be
held after the completion of the Business Combination;
|
•
|
Class III comprised of three individuals whose terms will expire at Volato Group’s third annual meeting of stockholders to be
held after the completion of the Business Combination.
|
Name
|
| |
Age
|
| |
Position
|
Executive Officers
|
| |
|
| |
|
Matthew Liotta
|
| |
45
|
| |
Chief Executive Officer and Director
|
Nicholas Cooper
|
| |
38
|
| |
Chief Commercial Officer and Director
|
Michael Prachar
|
| |
54
|
| |
Chief Operating Officer
|
Keith Rabin
|
| |
52
|
| |
President and Chief Financial Officer
|
Steven Drucker
|
| |
53
|
| |
Chief Technology Officer
|
Non-Employee Directors
|
| |
|
| |
|
Mike Nichols
|
| |
52
|
| |
Director
|
Joan Sullivan Garrett
|
| |
74
|
| |
Director
|
Robert George
|
| |
67
|
| |
Director
|
Name and principal position
|
| |
Year
|
| |
Salary
($)
|
| |
Option
Awards
($)(1)
|
| |
Total
($)
|
Matthew Liotta
Co-Founder & Chief Executive Officer
|
| |
|
| |
|
| |
|
| |
|
|
2022
|
| |
138,582(2)
|
| |
7,381
|
| |
145,963
|
||
Keith Rabin
Chief Financial Officer(3)
|
| | | | | | | | ||||
|
2022
|
| |
154,458(4)
|
| |
12,192
|
| |
166,650
|
||
Michael Prachar
Chief Operating Officer
|
| |
|
| |
|
| |
|
| |
|
|
2022
|
| |
155,833(5)
|
| |
16,136
|
| |
171,969
|
(1)
|
Represents the aggregate grant date fair value of option awards granted under the Volato, Inc. 2021 Equity Incentive Stock
Plan during the 2022 fiscal year, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718-Stock Compensation and using the assumptions contained in Note 12 to the financial
statements included elsewhere herein.
|
(2)
|
Mr. Liotta’s annualized salary increased from $120,000 to $160,000 on April 16, 2022, and increases to $310,000 effective as
of the date of this filing.
|
(3)
|
Mr. Rabin was promoted to President of Volato as of May 1, 2023. He will continue to serve in both roles until a successor
Chief Financial Officer is hired.
|
(4)
|
Mr. Rabin commenced employment with Volato on April 25, 2022. His annualized salary amount for 2022 was $225,000 and increases
to $300,000 effective as of the date of this filing.
|
(5)
|
Mr. Prachar commenced employment with Volato on February 1, 2022. His annualized salary amount for 2022 was $170,000 and
increases to $235,000 effective as of the date of this filing.
|
|
| |
Option Awards
|
|||||||||
Name
|
| |
Number of securities
underlying
unexercised options
(#) exercisable
|
| |
Number of securities
underlying
unexercised options
(#) unexercisable
|
| |
Option
exercise
price ($)
|
| |
Option
expiration
date
|
Matthew Liotta(1)
|
| |
57,284
|
| |
87,435
|
| |
$0.16
|
| |
03/10/2027
|
Keith Rabin(2)
|
| |
84,664
|
| |
154,389
|
| |
$0.14
|
| |
11/15/2032
|
Michael Prachar(3)
|
| |
125,238
|
| |
191,155
|
| |
$0.14
|
| |
03/10/2032
|
(1)
|
25% of the total award vested on March 10, 2023, then 1/48th vests on a monthly basis thereafter, subject to continued
service through each such vesting date and any additional accelerated vesting granted by the Volato board of directors in connection with the Business Combination.
|
(2)
|
1/48th of the total award vests on a monthly basis commencing June 18, 2022, subject to continued service through each such
vesting date and any additional accelerated vesting granted by the Volato board of directors in connection with the Business Combination.
|
(3)
|
25% of the total award vested on March 10, 2023, then 1/48th vests on a monthly basis thereafter, subject to continued
service through each such vesting date and any additional accelerated vesting granted by the Volato board of directors in connection with the Business Combination.
|
Name
|
| |
Option awards
($)(4)
|
| |
Total
($)
|
Joan Sullivan Garrett(1)
|
| |
1,107
|
| |
1,107
|
Nicholas Lenoci, Jr.(2)
|
| |
1,107
|
| |
1,107
|
Michael D. Nichols(3)
|
| |
—
|
| |
—
|
Robert George(5)
|
| |
—
|
| |
—
|
(1)
|
Ms. Garrett was granted an option award in the amount of 21,707 shares on December 19, 2022, with 1/24th of the total award
vesting on a monthly basis each month thereafter, subject to continued service through each such vesting date and any additional accelerated vesting granted by the Volato board of directors in connection with the Business Combination.
|
(2)
|
Mr. Lenoci was granted an option award in the amount of 21,707 shares on December 28, 2022, with 1/24th of the total award
vesting on a monthly basis each month thereafter, subject to continued service through each such vesting date and any additional accelerated vesting granted by the Volato board of directors in connection with the Business Combination.
Mr. Lenoci’s service to the board ended on June 8, 2023.
|
(3)
|
Mr. Nichols was granted an option award in the amount of 21,707 shares on August 15, 2021, with 1/24th of the total
award vesting on a monthly basis each month thereafter, subject to continued service through each such vesting date and any additional accelerated vesting granted by the Volato board of directors in connection with the Business
Combination.
|
(4)
|
Represents the aggregate grant date fair value of option awards granted under the Volato, Inc. 2021 Equity Incentive Stock
Plan during the 2022 fiscal year, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718-Stock Compensation and using the assumptions contained in Note 12 to the financial
statements included elsewhere herein.
|
(5)
|
Mr. George’s service to the board began on June 8, 2023 and, accordingly, he did not receive a compensation award during
fiscal year 2022.
|
•
|
$3,000,000 CN-001 Note issued to Liotta Family Office, LLC, which is 60% owned by Dennis Liotta (Matthew Liotta’s father),
20% owned by John Liotta (Matthew Liotta’s brother), and 20% owned by Matthew Liotta. The note accrued $165,616 in interest and converted into 529,190 shares of Series A-2 Preferred Stock.
|
•
|
$1,000,000 CN-001 Note issued to the Matthew D. Liotta 2021 Trust dated January 21st, 2021. The note accrued $27,397 in
interest and converted into 171,748 shares of Series A-2 Preferred Stock.
|
•
|
$6,001,407.00 CN-002 Note issued to Dennis Liotta, pursuant to the conversion of the Revolving Line of Credit described under
“Working Capital Loans.” The note accrued $11,181 in interest and converted into 668,065 shares of Series A-3 Preferred Stock.
|
Name and principal position
|
| |
Year
|
| |
Salary ($)
|
| |
Option
Awards ($)(1)
|
| |
Total ($)
|
Jennifer Liotta(2)
VP of Legal
|
| |
2022
|
| |
148,333
|
| |
4,428
|
| |
152,761
|
John Liotta(3)
VP of Strategic Partnerships &
Experiences
|
| |
2022
|
| |
91,863
|
| |
—
|
| |
91,863
|
Jodi Lyn Tollus(4)
Finance Executive
|
| |
2022
|
| |
66,667
|
| |
443
|
| |
67,110
|
(1)
|
Represents the aggregate grant date fair value of option awards granted under the Volato, Inc. 2021 Equity Incentive Stock
Plan during the 2022 fiscal year, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718-Stock Compensation and using the assumptions contained in Note 12 to the financial
statements included elsewhere herein.
|
(2)
|
Mattew Liotta’s spouse, Jennifer Liotta, has been employed by Volato since 2021. On December 15, 2022, she was granted an
option award in the amount of 86,831 shares, subject to a vesting schedule (1/48th vesting monthly over four years with a one-year cliff and fully vested as of September 2025).
|
(3)
|
Matthew Liotta’s brother, John Liotta, has been employed by Volato since 2021. On August 15, 2021, he was granted an option
award in the amount of 86,831 shares, subject to a vesting schedule (1/48th vesting monthly over four years with no cliff, fully vested as of August 2025).
|
(4)
|
Michael Prachar’s spouse, Jodi Lynn Tollus, has been employed by Volato since 2022. On December 15, 2022, she was granted an
option award in the amount of 8,683 shares, subject to a vesting schedule (1/48th vesting monthly over four years with a one-year cliff and fully vested as of March 2026).
|
•
|
each person who is, or is expected to be, the beneficial owner of more than 5% of the outstanding shares of voting Common
Stock;
|
•
|
each of our named executive officers and directors;
|
•
|
each person who will become a named executive officer or director of Volato Group post-Business Combination; and
|
•
|
all current executive officers and directors of PACI, as a group pre-Business Combination and all executive officers and
directors on the Volato Group Board post-Business Combination.
|
|
| |
|
| |
|
| |
After the Business Combination
|
|||||||||
|
| |
Prior to the Business
Combination
|
| |
Assuming No
Redemptions
|
| |
Assuming
Maximum
Redemptions
|
|||||||||
Name and Address of Beneficial Owners
|
| |
Number of
shares
|
| |
%
|
| |
Number of
shares
|
| |
%
|
| |
Number of
shares
|
| |
%
|
Five Percent Holders of PACI(1)
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
PROOF Acquisition Sponsor I, LLC (our Sponsor)(2)
|
| |
6,421,827
|
| |
48.13%
|
| |
7,138,350
|
| |
22.78%
|
| |
7,138,350
|
| |
28.68%
|
Highbridge Capital Management, LLC(3)
|
| |
2,170,352
|
| |
16.3%
|
| |
2,170,352
|
| |
6.93%
|
| |
—
|
| |
—
|
Magnetar Financial LLC(4)
|
| |
2,256,400
|
| |
16.9%
|
| |
2,256,400
|
| |
7.20%
|
| |
—
|
| |
—
|
Calamos Market Neutral Income Fund, a series of Calamos
Investment Trust(5)
|
| |
1,500,000
|
| |
11.2%
|
| |
1,500,000
|
| |
4.79%
|
| |
—
|
| |
—
|
Radcliffe Capital Management, L.P.(6)
|
| |
336,624
|
| |
5.22%
|
| |
336,624
|
| |
1.07%
|
| |
—
|
| |
—
|
Directors and Named Executive Offices
of PACI(7)
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
John C. Backus, Jr.(8)(9)(10)
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Steven P. Mullins(8)(9)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Michael W. Zarlenga(8)(9)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Peter C. Harrison(9)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Coleman Andrews(9)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
Mark Lerdal(9)
|
| |
—
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Lisa Suennen(9)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
All officer and directors as a group (7 individuals)
|
| |
6,591,800
|
| |
49.40%
|
| |
7,609,516
|
| |
24.29%
|
| |
7,609,516
|
| |
30.57%
|
|
| |
|
| |
|
| |
After the Business Combination
|
|||||||||
|
| |
Prior to the Business
Combination
|
| |
Assuming No
Redemptions
|
| |
Assuming
Maximum
Redemptions
|
|||||||||
Name and Address of Beneficial Owners
|
| |
Number of
shares
|
| |
%
|
| |
Number of
shares
|
| |
%
|
| |
Number of
shares
|
| |
%
|
Directors and Named Executive Officers
of Volato Group
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
After Consummation of the Business
Combination(11)
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
Matthew Liotta(12)
|
| |
—
|
| |
—
|
| |
6,823,060
|
| |
18.03%
|
| |
5,649,625
|
| |
22.70%
|
Nicholas Cooper(13)
|
| |
—
|
| |
—
|
| |
3,414,660
|
| |
10.90%
|
| |
3,414,660
|
| |
13.72%
|
Michael Prachar(14)
|
| |
—
|
| |
—
|
| |
128,674
|
| |
1.01%
|
| |
316,393
|
| |
1.27%
|
Keith Rabin(15)
|
| |
—
|
| |
—
|
| |
84,664
|
| |
0.76%
|
| |
239,053
|
| |
0.96%
|
Michael Nichols(16)
|
| |
—
|
| |
—
|
| |
43,415
|
| |
0.14%
|
| |
43,415
|
| |
0.17%
|
Joan Sullivan Garrett(17)
|
| |
—
|
| |
—
|
| |
8,140
|
| |
0.07%
|
| |
21,706
|
| |
0.09%
|
Robert George(18)
|
| |
—
|
| |
—
|
| |
3,617
|
| |
0.07%
|
| |
21,707
|
| |
0.09%
|
All Directors and Executive Officers of
Volato Group as a Group (Individuals)
|
| |
—
|
| |
—
|
| |
9,706,559
|
| |
30.98%
|
| |
9,706,559
|
| |
39.00%
|
*
|
Less than 1%.
|
(1)
|
Unless otherwise noted, the business address of each of PACI’s officers and directors is 11911 Freedom Drive, Suite 1080
Reston, VA 20190.
|
(2)
|
Post-Business Combination interests shown includes Class A Common Stock converted from the Series A-1 Preferred Stock issued
by Volato to the Sponsor in the Private Financing.
|
(3)
|
Pursuant to Schedule 13G filed on February 2, 2023 by Highbridge Capital Management, LLC. The business address of the
reporting person is 277 Park Avenue, 23rd Floor, New York, New York 10172. This calculation assumes that the filing person did not redeem any of its shares in connection with the vote of stockholders to approve the amendment on May 22,
2023 to PACI’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) to extend the date by which PACI must consummate a Business Combination.
|
(4)
|
Pursuant to Schedule 13G/A filed on February 2, 2023 by Magnetar Financial LLC, Magnetar Capital Partners LP, Supernova
Management LLC, David J. Snyderman. The business address of each of the reporting person is 11911 Freedom Drive, Suite 1080, Reston, VA 20190. This calculation assumes that the filing person did not redeem any of its shares in
connection with the vote of stockholders to approve the amendment to the Certificate of Incorporation to extend the date by which PACI must consummate a Business Combination.
|
(5)
|
Pursuant to Schedule 13G filed on February 8, 2022 by Calamos Market Neutral Income Fund, a series of Calamos Investment
Trust. The business address of the reporting person is 2020 Calamos Court Naperville, IL 60563. This calculation assumes that the filing person did not redeem any of its shares in connection with the vote of stockholders to approve the
amendment to the Certificate of Incorporation to extend the date by which PACI must consummate a Business Combination.
|
(6)
|
Pursuant to Schedule 13G filed on May 25, 2023 by Radcliffe Capital Management, L.P., RGC Management Company, LLC,
Steven B. Katznelson, Christopher Hinkel, Radcliffe SPAC Master Fund, L.P., and Radcliffe SPAC GP, LLC. The business address of each of the reporting person is 50 Monument Road, Suite 300, Bala Cynwyd, PA 19004.
|
(7)
|
Interests shown consist solely of Founder Shares, classified as shares of Class B Common Stock. Such shares will automatically
convert into shares of Class A Common Stock at the time of our initial Business Combination, or earlier at the election of the holder. Our Sponsor is the record holder of such shares. Our sponsor is controlled by its manager, PACI
Sponsor Management, LLC. In addition, see Note 9 below.
|
(8)
|
Messrs. Backus, Mullins and Zarlenga are managing members of PACI Sponsor Management, LLC, the manager of our Sponsor and no
person individually has the power to vote or control the interests of our Sponsor. Each individual disclaims beneficial ownership of these shares except to the extent of any pecuniary interest therein.
|
(9)
|
This individual does not beneficially own any Founder Shares or Private Placement Warrants. However, this individual has a
pecuniary interest in these securities through his or her ownership of membership interests of our Sponsor.
|
(10)
|
Mr. Backus is one of three managing members of PROOF Management, LLC, the manager of our PROOF II VI, LLC which owns 169,973
Founder Shares or 1.27% of the outstanding Common Stock of PACI. No one managing member has the power to vote or control the interests of PROOF II VI, LLC. Mr. Backus disclaims beneficial ownership of these shares.
|
(11)
|
Unless otherwise noted, the business address of each of our officers and directors is 1954 Airport Road, Suite 124, Chamblee,
GA 30341.
|
(12)
|
Mr. Liotta beneficially owns (i) 3,414,660 shares of Volato stock held by Argand Group LLC in which Mr. Liotta holds shared
voting and investment power, (ii) 57,284 shares issuable upon the exercise of options; (iii) 171,748 shares of Volato’s Series A-2 stock held in a trust for the benefit of Mr. Liotta; (iv) 1,302,477 shares of Volato’s Preferred
Series Seed stock and 529,190 shares of Volato’s Series A-2 stock held by Liotta Family Office, LLC in which Mr. Liotta has shared voting and investment power, (v) 1,302,477 shares of Volato’s Preferred Series Seed stock held by PDK
Capital, LLC in which Mr. Liotta has sole voting and investment power; and (vi) 45,224 shares issuable upon the exercise of options held by a member of Mr. Liotta’s household.
|
(13)
|
Mr. Cooper beneficially owns 3,414,660 shares of Volato stock held by Hoop Capital LLC in which Mr. Cooper holds shared voting
and investment power.
|
(14)
|
Mr. Prachar beneficially owns 125,238 shares issuable upon the exercise of options.
|
(15)
|
Mr. Rabin beneficially owns 84,664 shares issuable upon the exercise of options.
|
(16)
|
Mr. Nichols beneficially owns 43,415 shares issuable upon the exercise of options.
|
(17)
|
Ms. Garrett beneficially owns 5,426 shares directly and 2,714 shares issuable upon the exercise of options.
|
(18)
|
Mr. George beneficially owns 36,617 shares issuable upon the exercise of options.
|
PACI
|
| |
Volato Group
|
Authorized Capital Stock
|
|||
The total number of authorized shares of all classes of capital stock which
PACI is authorized to issue 83,500,000 shares, consisting of 82,500,000 shares of Common Stock, including 70,000,000 shares of Class A Common Stock and 12,500,000 shares of Class B Common Stock, and 1,000,000 shares of Preferred Stock,
$0.0001 par value per share.
|
| |
The Proposed Charter provides that the total number of authorized shares of
all classes of capital stock which Volato Group is authorized to issue is 81,000,000 shares, consisting of two (2) classes: 80,000,000 shares of Class A Common Stock, $0.0001 par value per share and 1,000,000 shares of Preferred Stock,
$0.001 par value per share.
|
|
| |
|
Rights to Issue Preferred Stock
|
|||
Subject to certain requirements relating to an initial business combination
set forth in the Current Charter, the PACI Board is expressly authorized to provide out of the unissued shares of the preferred stock for one or more series of preferred stock and to establish from time to time the number of shares to
be included in each such series and to fix the voting powers, full or limited, and the designations, preferences, and relative, participating, optional, or other special rights and the qualifications, limitations or restrictions
thereof, as shall be stated in the resolution or resolutions adopted by the PACI Board providing for the issuance of such series and included in a certificate of designation filed pursuant to the DGCL
|
| |
The Proposed Charter authorizes the board of directors, subject to any
limitations prescribed by the law of the State of Delaware, by resolution or resolutions adopted from time to time, to provide for the issuance of shares of preferred stock in one or more series, and, by filing a certificate of
designation pursuant to the applicable law of the State of Delaware, to establish from time to time the number of shares to be included in each such series, and to fix the designations, powers (including voting powers, if any),
preferences and relative, participating, optional, special and other rights, if any, of each such series and any qualifications, limitations and restrictions thereof, as shall be stated in the resolution or resolutions adopted by the
Board providing for the issuance of such series and included in a certificate of designation.
|
|
| |
|
Voting Rights
|
|||
Except as otherwise required by law or the Current Charter (including any
preferred stock designation), the holders of shares of PACI Common Stock shall be entitled to one vote for each such share on each matter properly submitted to the stockholders on which the holders of the PACI Common Stock are entitled
to vote.
|
| |
Except as otherwise provided in the Proposed Charter, each outstanding share
of Volato Group Common Stock will entitle the holder thereof to one vote on each matter properly submitted to the stockholders of Volato Group generally for their vote. Except as otherwise required by law, holders of Volato Group Common
Stock will not be entitled to vote on any amendment to the Proposed
|
PACI
|
| |
Volato Group
|
|
| |
Charter (including any certificate of designation relating to any series of
preferred stock) that relates solely to the terms of one or more outstanding series of preferred stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series,
to vote thereon pursuant to the Proposed Charter (including any certificate of designation relating to any series of preferred stock).
|
|
| |
The Proposed Charter contains qualified limitations on the voting power
described below under the column titled “U.S. Citizenship Requirements.”
|
|
| |
|
Cumulative Voting
|
|||
Delaware law provides that a corporation may grant stockholders cumulative
voting rights for the election of directors in its certificate of incorporation. However, the Current Charter does not authorize cumulative voting.
|
| |
Delaware law provides that a corporation may grant stockholders cumulative
voting rights for the election of directors in its certificate of incorporation; however, the Proposed Charter does not authorize cumulative voting.
|
|
| |
|
Number of Directors and Structure of Board
|
|||
The Current Charter provides that the number of directors of PACI shall be
fixed exclusively by resolution of the PACI Board. The Current Charter provides that the PACI Board shall be divided into three classes, as nearly equal in number as possible and that the term of initial Class I directors shall expire
at the first annual meeting of stockholders following the effectiveness of the Current Charter, the term of the initial Class II directors shall expire at the second annual meeting of stockholders following the effectiveness of the
Current Charter, and the term of the initial Class III directors shall expire at the second annual meeting of stockholders following the effectiveness of the Current Charter. The Current Charter provides that, at each succeeding annual
meeting of stockholders, beginning with the first annual meeting of stockholders following the effectiveness of the Current Charter, successors to the class of directors whose term expires at that annual meeting shall be elected for a
three-year term or until the election and qualification of their respective successors in office, subject to their earlier death, resignation or removal.
|
| |
The Proposed Charter provides that the total number of directors shall be
fixed from time to time solely by resolution adopted by the Board. The Proposed Charter provides that the Volato Group Board shall be divided into three classes, as nearly equal in number as possible and that the term of initial Class I
directors shall expire at the first annual meeting of stockholders following the effectiveness of the Proposed Charter, the term of the initial Class II directors shall expire at the second annual meeting of stockholders following the
effectiveness of the Proposed Charter, and the term of the initial Class III directors shall expire at the second annual meeting of stockholders following the effectiveness of the Proposed Charter. The Proposed Charter provides that, at
each succeeding annual meeting of stockholders, beginning with the first annual meeting of stockholders following the effectiveness of the Proposed Charter, successors to the class of directors whose term expires at that annual meeting
shall be elected for a three-year term or until the election and qualification of their respective successors in office, subject to their earlier death, resignation or removal.
|
|
| |
|
Removal of Directors
|
|||
The Current Charter provides that, except as otherwise required by law or
the Current Charter, any or all of the directors may be removed from office at any time, but only for cause and only by the affirmative vote of holders of a majority of the voting power of all then-outstanding shares of capital stock
entitled to vote generally in the election of directors, voting together as a single class.
|
| |
The Proposed Charter provides that, subject to the special rights of the
holders of any series of preferred stock, a director may be removed from the board of directors only for cause and only by the affirmative vote of the holders of at least two-thirds (2/3) of the voting power of the then-outstanding
shares of capital stock of Volato Group entitled to vote generally in the election of directors voting together as a single class.
|
PACI
|
| |
Volato Group
|
Vacancies and Newly Created Directorships on the Board
|
|||
The Current Charter provides that, except as otherwise required by law or
the Current Charter (including the special rights of the holders of any series of preferred stock and the rights of the holders of the Class B Common Stock to appoint directors prior to the consummation of a business combination), newly
created directorships resulting from an increase in the number of directors and any vacancies on the PACI Board resulting from death, resignation, retirement, disqualification, removal or other cause may be filled solely and exclusively
by a majority vote of the remaining directors then in office, even if less than a quorum, or by a sole remaining director (and not by stockholders).
|
| |
The Proposed Charter provides that, subject to the special rights of the
holders of any series of preferred stock, any vacancy occurring in the board of directors for any cause, and any newly created directorship resulting from any increase in the authorized number of directors may be filled solely and
exclusively by a majority vote of the remaining directors then in office, even if less than a quorum, or by a sole remaining director.
|
|
| |
|
Amendments to Certificate of Incorporation
|
|||
The Current Charter provides that PACI reserves the right to amend, alter,
change or repeal any provision of the Current Charter (including any preferred stock designation), in the manner now or hereafter prescribed by the Current Charter and the DGCL.
The Current Charter provides that no amendment to article FIFTH of the
Current Charter shall be effective prior to the consummation of PACI’s initial Business Combination unless approved by the affirmative vote of the holders of at least 65% of all then-outstanding shares of PACI Common Stock; provided,
however, that the provisions of paragraph J of Article FIFTH may only be amended prior to the consummation of PACI’s initial Business Combination by approval of a majority of at least ninety percent (90%) of the shares of all then
outstanding Common Stock. The Current Charter also requires a separate vote of the holders of a majority of the outstanding shares of Class B Common Stock for certain amendments that alter or change the rights, powers or preferences of
the Class B Common Stock prior to the consummation of PACI’s initial Business Combination.
|
| |
The Proposed Charter provides that Volato Group reserves the right at any
time and from time to time to amend, alter, change or repeal any provision contained in the Proposed Charter (including any Preferred Stock Designation) in the manner now or hereafter prescribed by the Proposed Charter and the DGCL.
The Proposed Charter provides that, notwithstanding any other provisions of
the Proposed Charter or any provision of law which might otherwise permit a lesser vote or no vote, but in addition to any affirmative vote of the holders of any particular class or series of capital stock of Volato Group required by
law or by the Proposed Charter or any preferred stock designation, the affirmative vote of the holders of at least two-thirds (2/3) of the voting power of all of the then-outstanding shares of the capital stock of Volato Group entitled
to vote generally in the election of directors, voting together as a single class, will be required to amend or repeal, or adopt any provision that is inconsistent with, Article IV, Article V, Article VI, Article VIII, Article IX,
Article XI or Article XII of the Proposed Charter (the “Specified Provisions”) unless a lower threshold is permitted under Section 242 of the DGCL to effect a stock split or subdivision of shares or to increase or decrease the number of
authorized shares of a class in connection with a stock split or subdivision, in which case such amendment may be adopted pursuant to such lower threshold.
|
|
| |
|
Amendments to Bylaws
|
|||
The Current Charter provides that the PACI Board shall have the power to
adopt, amend, alter or repeal the bylaws. The PACI stockholders also have the power to amend the bylaws.
|
| |
The Proposed Charter provides that the bylaws may be adopted, amended or
repealed by the Volato Group Board. The Proposed Charter provides that the stockholders of Volato Group may also adopt, amend or repeal the bylaws by the affirmative vote of the holders of at least two-thirds (2/3) of the voting power
of all of
|
PACI
|
| |
Volato Group
|
|
| |
the then-outstanding shares of the capital stock of Volato Group entitled to
vote generally in the election of directors, voting together as a single class.
|
|
| |
|
Limitation of Liability of Directors and Officers
|
|||
The Current Charter provides that a director of PACI shall not be personally
liable to PACI or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL as the same exists or may
hereafter be amended unless they violated their duty of loyalty to PACI or its stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or
unlawful redemptions, or derived improper personal benefit from their actions as directors
|
| |
The Proposed Charter provides that, to the fullest extent permitted by law,
no director or officer of Volato Group will be personally liable to Volato Group or its stockholders for monetary damages for breach of fiduciary duty as a director or officer.
|
|
| |
|
Indemnification of Directors, Officers, Employees and Agents
|
|||
The Current Charter provides that, to the fullest extent permitted by
applicable law, PACI shall indemnify and hold harmless each person who is or was made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the fact that he or she is or was a director or officer of PACI or, while a director or officer of PACI, is or was serving at the request of PACI as a director, officer,
employee or agent of another corporation or of a partnership, joint venture, trust, other enterprise or nonprofit entity, including service with respect to an employee benefit plan, whether the basis of such proceeding is alleged action
in an official capacity as a director, officer, employee or agent, or in any other capacity while serving as a director, officer, employee or agent, against all liability and loss suffered and expenses (including, without limitation,
attorneys’ fees, judgments, fines, ERISA excise taxes and penalties and amounts paid in settlement) reasonably incurred by such indemnitee in connection with such proceeding.
PACI’s Current Charter also provides that PACI shall indemnify and advance
expenses to its directors and officers to the fullest extent not prohibited by applicable law (subject to limited exceptions, including that such rights to indemnification and advancement shall not extend to proceedings or parts thereof
initiated by an indemnitee without authorization of the PACI board). The Current Charter provides that PACI may maintain directors’ and officers’ liability insurance providing indemnification for PACI’s directors, officers, employees or
agents for some liabilities
|
| |
The Proposed Bylaws provide that Volato Group shall indemnify and hold
harmless, to the fullest extent permitted by Delaware law, each person who was or is made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative or any other type whatsoever, by reason of the fact that he or she is or was a director or an officer of Volato Group or, while a director or officer of Volato Group, is or was
serving at the request of Volato Group as a director, officer, employee, agent or trustee of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan
(hereinafter an “indemnitee”), against all expenses, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes and penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by such
person in connection therewith, provided such person acted in good faith and in a manner that the person reasonably believed to be in or not opposed to the best interests of Volato Group, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe the person’s conduct was unlawful. The rights to indemnitees to indemnification under the Proposed Bylaws does not, however, generally include proceedings or parts thereto initiated by the
indemnitee without authorization from the Volato Group Board.
The Proposed Bylaws provide that, in addition to the right to
indemnification above, an indemnitee shall also have the right to be paid the expenses (including attorney’s fees) incurred in appearing at, participating in
|
PACI
|
| |
Volato Group
|
|
| |
or defending any such proceeding in advance of its final disposition or in
connection with a proceeding brought to establish or enforce a right to indemnification or advancement of expenses; provided, however, that, if (x) the DGCL requires or (y) in the case of an advance made in a proceeding brought to
establish or enforce a right to indemnification or advancement, an advancement of expenses incurred by an indemnitee in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered by
such indemnitee, including, without limitation, service to an employee benefit plan) shall be made solely upon delivery of an undertaking, by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be
determined after final judicial decision from which there is no further right to appeal that such indemnitee is not entitled to indemnification.
|
|
| |
|
Corporate Opportunity
|
|||
The Current Charter provides that the doctrine of corporate opportunity, or
any other analogous doctrine, shall not apply with respect to PACI or any of its officers or directors in circumstances where the application of any such doctrine would conflict with any fiduciary duties or contractual obligations they
may have as of the date of the Current Charter and into the future, and PACI renounces any expectancy that any of the directors or officers of PACI will offer any such corporate opportunity of which he or she may become aware to PACI.
In addition to the foregoing, the doctrine of corporate opportunity shall not apply to any other corporate opportunity with respect to any of the directors or officers of PACI unless such corporate opportunity is expressly offered to
such person solely in his or her capacity as a director or officer of PACI and such opportunity is one PACI is legally and contractually permitted to undertake and would otherwise be reasonable for PACI to pursue.
|
| |
The Proposed Charter provides that to the extent allowed by law, the
doctrine of corporate opportunity, or any other analogous doctrine, shall not apply with respect to Volato Group or any of its officers or directors, or any of their respective affiliates, in circumstances where the application of any
such doctrine would conflict with any fiduciary duties or contractual obligations they may have as of the date of the Proposed Charter or in the future, and Volato Group renounces any expectancy that any of the directors or officers of
Volato Group will offer any such corporate opportunity of which he or she may become aware to Volato Group or any interest or expectancy in any such corporate opportunity, except, the doctrine of corporate opportunity shall apply with
respect to any of the directors or officers of Volato group with respect to a corporate opportunity that was offered to such person solely in his or her capacity as a director or officer of Volato Group and (i) such opportunity is one
the Volato Group is legally and contractually permitted to undertake and would otherwise be reasonable for Volato Group to pursue and (ii) the director or officer is permitted to refer that opportunity to Volato Group without violating
any legal obligation.
|
|
| |
|
Exclusive Forum Selection
|
|||
The Current Charter requires, unless PACI consents in writing to the
selection of an alternative forum, that (i) any derivative action or proceeding brought on PACI’s behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer, other employee or agent to PACI or
its stockholders, or any claim for aiding and abetting any such alleged breach, (iii) any action asserting a claim against PACI, its directors, officers or employees arising pursuant to any
|
| |
The Proposed Charter provides that, unless Volato Group consents in writing
to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if and only if the Court of Chancery of the State of Delaware lacks subject matter jurisdiction, any state court located within the State of
Delaware or, if and only if all such state courts lack subject matter jurisdiction, the federal district court for the District of Delaware) will be the sole and exclusive forum for the following types of
|
PACI
|
| |
Volato Group
|
provision of the DGCL or the Current Charter or PACI’s current bylaws, or
(iv) any action asserting a claim against PACI, its directors, officers or employees governed by the internal affairs doctrine may be brought only in the Court of Chancery in the State of Delaware, except any claim (A) as to which the
Court of Chancery of the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court
of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or (C) arising under the federal securities laws, including the
Securities Act of 1933, as amended, as to which the Court of Chancery and the federal district court for the District of Delaware shall concurrently be the sole and exclusive forums. The Current Charter further provides that,
notwithstanding the foregoing, the provisions of paragraph (A) above will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which federal district courts of the United States
of America shall be the sole and exclusive forum. The Current Charter further provides that if an action is brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such
stockholder’s counsel.
The Current Charter provides that if any action within the scope of
paragraph (A) above is filed in a court other than a court located within Delaware in the name of any stockholder, such stockholder shall be deemed to have consented to (i) the personal jurisdiction of the state and federal courts
located within Delaware in connection with any action brought in any such court to enforce paragraph (A) above and (ii) having service of process made upon such stockholder in any such enforcement action by service upon such
stockholder’s counsel in the foreign action as agent for such stockholder.
|
| |
actions or proceedings under Delaware statutory or common law: (i) any
derivative action or proceeding brought on behalf of Volato Group; (ii) any action or proceeding asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, employee or stockholder of Volato Group to
Volato Group or Volato Group Stockholders; (iii) any action asserting a claim arising pursuant to any provision of the DGCL or the Proposed Charter or the bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of
the State of Delaware, or (iv) any action asserting a claim governed by the internal affairs doctrine of the law of the State of Delaware. The Proposed Charter provides that the foregoing provisions shall not apply to any action or
proceeding asserting a claim under the Securities Act or the Exchange Act.
The Proposed Charter provides that unless Volato Group consents in writing
to the selection of an alternative forum, to the fullest extent permitted by law, the federal district courts of the United States of America will be the exclusive forum for the resolution of any complaint asserting a cause of action
arising under the Securities Act.
|
|
| |
|
Liquidation
|
|||
The Current Charter provides that, subject to applicable law, the rights, if
any, of the holders of any outstanding series of preferred stock and certain provisions of the Current Charter, in the event of any voluntary or involuntary liquidation, dissolution or winding up of PACI, after payment or provision for
payment of the debts and other liabilities of PACI, the holders of shares of PACI Common Stock shall be entitled to receive all the remaining assets of PACI available for distribution to its stockholders, ratably in proportion to the
number of shares of PACI Common Stock held by them.
|
| |
The Proposed Charter provides that, subject to applicable law and the
rights, if any, of the holders of any outstanding series of preferred stock, in the event of any voluntary or involuntary liquidation, dissolution or winding up of Volato Group, after payment or provision for payment of the debts and
other liabilities of Volato Group, the holders of all outstanding shares of Class A Common Stock shall be entitled to receive all the remaining assets of Volato Group available for distribution to its stockholders, ratably in proportion
to the number of shares of Class A Common Stock held by them.
|
PACI
|
| |
Volato Group
|
Redemption Rights
|
|||
The Current Charter provides that, until the consummation of PACI’s initial
business combination (unless such provision is amended with the approval of holders of 65% of the PACI Common Stock), PACI shall provide all holders of the Public Shares with the opportunity to have their Public Shares redeemed upon the
consummation of an initial business combination pursuant to, and subject to certain limitations set forth in, the Current Charter for cash equal to the applicable redemption price per share.
|
| |
None.
|
|
| |
|
Restrictions on Business Combinations
|
|||
The Current Charter states that PACI expressly opts out of Section 203 of
the DGCL, which would otherwise limit a corporation’s ability to engage in any “business combination” with any “interested stockholder” (as each term is defined in Section 203 of the DGCL). However, the Current Charter restricts PACI’s
ability to engage in a business combination with an interested stockholder for a period of three years following the time that a stockholder became an interested stockholder, unless: (a) prior to such time, PACI’s board of directors
approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder, or (b) upon consummation of the transaction that resulted in the stockholder becoming an interested
stockholder, the interested stockholder owned at least eighty-five percent (85%) of the voting stock outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding (but not the
outstanding voting stock owned by the interested stockholder) those shares owned by (i) persons who are directors and also officers of PACI and (ii) employee stock plans in which employee participants do not have the right to determine
confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer, or (c) at or subsequent to that time, the business combination is approved by the board and authorized at an annual or special
meeting of stockholders, and not by written consent, by the affirmative vote of at least 66-2/3% of the outstanding voting stock that is not owned by the interested stockholder. The terms “affiliate,” “associate,” “business
combination,” “control” (including the terms “controlling,” “controlling by” and “under common control with”), “interested stockholder,” “owner” (including the terms “own” and “owned”), “person,” “stock,” and “voting stock” have
meanings ascribed to them in the Current Charter. The Current Charter provides that PROOF Acquisition Sponsor I, LLC and its affiliated and certain other persons defined as “Exempted Person” by the Current Charter shall not be
“interested stockholders.”
|
| |
The Proposed Charter does not opt out of Section 203 of the DGCL and,
therefore, subjects Volato Group to Section 203’s restrictions.
|
PACI
|
| |
Volato Group
|
U.S. Citizenship Requirements
|
|||
The Current Charter does not include any U.S. citizenship requirements or
restrictions applicable to the board, officers, or stockholders of PACI.
|
| |
The Proposed Charter includes several restrictions and requirements to
ensure Volato Group’s compliance with application U.S. aviation laws, including: (a) in no event shall the total number of shares of equity securities held by non-citizens entitled to be more than 24.9% of the aggregate votes of all
outstanding equity securities of Volato Group and that if that cap amount is exceeded, then the number of votes such holders shall be entitled to vote shall be reduced pro rata such that the total number of votes of such holders shall,
in the aggregate, equal 24.9%; and (b) directors who are U.S. citizens must comprise at least two-thirds of the directors present for purposes of determining quorum and a quorum shall not exist if directors who are not U.S. citizens
constitute more than one-third of the directors present and entitled to vote on the particular action. In addition, the Proposed Charter will require that least two-thirds of the directors, board committees, and the officers of Volato
Group must be U.S. citizens.
|
•
|
at any time while the warrants are exercisable;
|
•
|
upon not less than 30 days’ prior written notice of redemption to each warrant holder;
|
•
|
before the stockholder became an interested stockholder, the board of directors approved either the business combination or
the transaction which resulted in the stockholder becoming an interested stockholder;
|
•
|
upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding those shares owned by persons who are directors
and also officers, and employee stock plans, in some instances; or
|
•
|
at or after the time the stockholder became an interested stockholder, the business combination was approved by the board of
directors of the corporation and authorized at an annual or special meeting of the stockholders by the affirmative vote of at least 662∕3% of the outstanding voting stock which is not owned by the interested stockholder; or
|
•
|
the business combination is with an interested stockholder who became an interested stockholder at a time when the
restrictions contained in Section 203 did not apply because the corporation’s certificate of incorporation opted out of Section 203.
|
•
|
If the shares are registered in the name of the stockholder, the stockholder should contact PACI at its offices at 11911
Freedom Drive, Suite 1080, Reston, VA 20190 or its telephone number at (571) 310-4949 to inform PACI of his or her request; or
|
•
|
If a bank, broker or other nominee holds the shares, the stockholder should contact the bank, broker or other nominee
directly.
|
|
| |
Page
|
Unaudited Condensed Consolidated Financial Statements
|
| |
|
| | ||
| | ||
| | ||
| | ||
| | ||
|
| |
|
Audited Consolidated Financial Statements for the Years
Ended December 31, 2022 and 2021
|
| |
|
| | ||
| | ||
| | ||
| | ||
| | ||
| |
|
| |
Page
|
Financial Statements (Unaudited)
|
| |
|
| | ||
| | ||
| | ||
| | ||
| | ||
Financial Statements (Audited)
|
| |
|
| | ||
| | ||
| | ||
| | ||
| | ||
| |
|
| |
June 30,
2023
(Unaudited)
|
| |
December 31,
2022
(Audited)
|
ASSETS
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash
|
| |
$5,371,045
|
| |
$5,776,703
|
Accounts receivable
|
| |
1,552,264
|
| |
1,879,672
|
Deposits on aircraft
|
| |
19,183,334
|
| |
833,334
|
Prepaid expenses and other current assets
|
| |
2,239,750
|
| |
2,210,946
|
Total current assets
|
| |
28,346,393
|
| |
10,700,655
|
|
| |
|
| |
|
Fixed assets, net
|
| |
820,793
|
| |
348,562
|
Right-of-use asset
|
| |
1,429,342
|
| |
1,574,144
|
Equity-method investment
|
| |
153,742
|
| |
1,158,574
|
Deposits on aircraft
|
| |
4,500,000
|
| |
12,000,000
|
Other deposits
|
| |
75,018
|
| |
124,143
|
Restricted cash
|
| |
2,115,715
|
| |
2,101,980
|
Intangible – Customer list
|
| |
221,197
|
| |
251,525
|
Intangible Part 135 Certificates
|
| |
1,200,000
|
| |
1,363,000
|
Goodwill
|
| |
634,965
|
| |
634,965
|
Total assets
|
| |
$39,497,165
|
| |
$30,257,548
|
|
| |
|
| |
|
LIABILITIES AND SHAREHOLDERS’ DEFICIT
|
| |
|
| |
|
Current liabilities
|
| |
|
| |
|
Accounts payable and accrued liabilities
|
| |
$7,592,786
|
| |
$2,882,589
|
Loan from related party
|
| |
1,000,000
|
| |
5,150,000
|
Convertible notes, net
|
| |
35,509,043
|
| |
18,844,019
|
Operating lease liability, current
|
| |
304,093
|
| |
283,087
|
Accrued interest
|
| |
748,137
|
| |
780,606
|
Other loans
|
| |
23,251
|
| |
56,980
|
Customers' deposits
|
| |
3,226,273
|
| |
2,163,056
|
Total current liabilities
|
| |
48,403,583
|
| |
30,160,337
|
|
| |
|
| |
|
Deferred income tax liability
|
| |
305,000
|
| |
305,000
|
Operating lease liability, non-current
|
| |
1,132,732
|
| |
1,291,057
|
Long term notes payable
|
| |
12,653,603
|
| |
4,170,006
|
Total liabilities
|
| |
62,494,918
|
| |
35,926,400
|
COMMITMENTS AND CONTINGENCIES (Note 14)
|
| |
—
|
| |
—
|
|
| |
|
| |
|
Shareholders’ deficit
|
| |
|
| |
|
Preferred Seed Stock, par value $0.001, 3,981,236 shares
authorized, 3,981,236 shares issued and outstanding as of June 30, 2023, and December 31, 2022(*)
|
| |
3,981
|
| |
3,981
|
Common Stock, $0.001 par value, 26,249,929 shares
authorized, 7,313,371 and 7,120,208 shares issued and outstanding as of June 30, 2023, and December 31, 2022, respectively(*)
|
| |
7,313
|
| |
7,120
|
Additional paid-in capital(*)
|
| |
5,220,567
|
| |
5,175,307
|
Stock subscriptions receivable
|
| |
(15,000)
|
| |
(15,000)
|
Accumulated deficit
|
| |
(28,214,614)
|
| |
(10,840,260)
|
Total shareholders’ deficit
|
| |
(22,997,753)
|
| |
(5,668,852)
|
Total liabilities and shareholders’ deficit
|
| |
$39,497,165
|
| |
$30,257,548
|
(*)
|
The number of shares has been retroactively restated to reflect the one for 0.434159 reverse stock split,
which was effective on July 21, 2023. The number of shares has been retroactively restated to reflect the two for one stock split, which was effective on January 6, 2023
|
|
| |
Three Months Ended
June 30,
|
| |
Six Months Ended
June 30,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
Revenue
|
| |
$13,013,866
|
| |
$18,297,912
|
| |
$28,679,825
|
| |
$46,715,270
|
Cost of revenue
|
| |
16,847,599
|
| |
17,481,793
|
| |
34,851,505
|
| |
44,371,954
|
Gross profit (deficit)
|
| |
(3,833,733)
|
| |
816,119
|
| |
(6,171,680)
|
| |
2,343,316
|
|
| |
|
| |
|
| |
|
| |
|
Operating expenses
|
| |
|
| |
|
| |
|
| |
|
Salaries and benefits
|
| |
3,038,208
|
| |
1,408,660
|
| |
5,610,564
|
| |
2,054,849
|
Advertising
|
| |
353,971
|
| |
76,234
|
| |
577,334
|
| |
135,829
|
Professional fees
|
| |
371,284
|
| |
291,967
|
| |
880,488
|
| |
507,018
|
Stock-based compensation
|
| |
15,260
|
| |
3,918
|
| |
23,395
|
| |
6,642
|
Depreciation and amortization
|
| |
57,046
|
| |
28,056
|
| |
102,028
|
| |
91,108
|
General and administrative
|
| |
1,608,821
|
| |
701,042
|
| |
3,381,322
|
| |
1,412,378
|
Loss from operations
|
| |
(9,278,323)
|
| |
(1,693,758)
|
| |
(16,746,811)
|
| |
(1,864,508)
|
|
| |
|
| |
|
| |
|
| |
|
Other income (expense)
|
| |
|
| |
|
| |
|
| |
|
Gain from sale of Part 135 Certificate
|
| |
—
|
| |
—
|
| |
387,000
|
| |
—
|
Gain from sale of equity method investment
|
| |
20,000
|
| |
—
|
| |
440,000
|
| |
—
|
Gain from deconsolidation of investments
|
| |
—
|
| |
60,534
|
| |
—
|
| |
580,802
|
Income (loss) from equity-method investments
|
| |
(344)
|
| |
(11,299)
|
| |
21,982
|
| |
(34,282)
|
Other income
|
| |
127,186
|
| |
29,648
|
| |
145,575
|
| |
29,648
|
Interest income on restricted cash
|
| |
7,752
|
| |
—
|
| |
13,971
|
| |
—
|
Interest expense, net
|
| |
(735,844)
|
| |
(136,147)
|
| |
(1,636,071)
|
| |
(246,664)
|
Other income (expense)
|
| |
(581,250)
|
| |
(57,264)
|
| |
(627,543)
|
| |
329,504
|
|
| |
|
| |
|
| |
|
| |
|
Loss before provision for income taxes
|
| |
(9,859,573)
|
| |
(1,751,022)
|
| |
(17,374,354)
|
| |
(1,535,004)
|
Provision for income taxes (benefits)
|
| |
—
|
| |
(3,791)
|
| |
—
|
| |
(80,000)
|
Net Loss before non-controlling interest
|
| |
(9,859,573)
|
| |
(1,747,231)
|
| |
(17,374,354)
|
| |
(1,455,004)
|
Net Loss attributable to non-controlling interest
|
| |
—
|
| |
—
|
| |
—
|
| |
(32,600)
|
|
| |
|
| |
|
| |
|
| |
|
Net Loss attributable to Volato Inc.
|
| |
$(9,859,573)
|
| |
$(1,747,231)
|
| |
$(17,374,354)
|
| |
$(1,422,404)
|
|
| |
|
| |
|
| |
|
| |
|
Basic and Diluted Loss per share(*)
|
| |
$(1.36)
|
| |
$(0.25)
|
| |
$(2.42)
|
| |
$(0.20)
|
Weighted average common share outstanding:
|
| |
|
| |
|
| |
|
| |
|
Basic and Diluted(*)
|
| |
7,266,149
|
| |
7,120,208
|
| |
7,193,178
|
| |
7,120,208
|
(*)
|
The number of shares and per share amounts have been retroactively restated to reflect the one for
0.434159 reverse stock split, which was effective on July 21, 2023. The number of shares has been retroactively restated to reflect the two for one stock split, which was effective on January 6, 2023
|
|
| |
Series Seed Convertible
Preferred Stock(*)
|
| |
Common Stock(*)
|
| |
Additional
Paid-in
Capital(*)
|
| |
Subscription
Receivable
|
| |
Retained
Deficit
|
| |
Total
Shareholders’
Deficit
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| |||||||||||
Balance December 31, 2022
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,175,307
|
| |
$(15,000)
|
| |
$(10,840,260)
|
| |
$(5,668,852)
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
8,135
|
| |
—
|
| |
—
|
| |
8,135
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(7,514,781)
|
| |
(7,514,781)
|
Balance March 31, 2023
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,183,442
|
| |
$(15,000)
|
| |
$(18,355,041)
|
| |
$(13,175,498)
|
|
| |
Series Seed Convertible
Preferred Stock(*)
|
| |
Common Stock(*)
|
| |
Additional
Paid-in
Capital(*)
|
| |
Subscription
Receivable
|
| |
Retained
Deficit
|
| |
Total
Shareholders’
Deficit
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| |||||||||||
Balance March 31, 2023
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,183,442
|
| |
$(15,000)
|
| |
$(18,355,041)
|
| |
$(13,175,498)
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
15,260
|
| |
—
|
| |
—
|
| |
15,260
|
Common stock issued from options exercise
|
| |
—
|
| |
—
|
| |
193,163
|
| |
193
|
| |
21,865
|
| |
—
|
| |
—
|
| |
22,058
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(9,859,573)
|
| |
(9,859,573)
|
Balance June 30, 2023
|
| |
3,981,236
|
| |
$3,981
|
| |
7,313,371
|
| |
$7,313
|
| |
$5,220,567
|
| |
$(15,000)
|
| |
$(28,214,614)
|
| |
$(22,997,753)
|
(*)
|
The number of shares has been retroactively restated to reflect the one for 0.434159 reverse stock split,
which was effective on July 21, 2023. The number of shares has been retroactively restated to reflect the two for one stock split, which was effective on January 6, 2023
|
|
| |
Series Seed Convertible
Preferred Stock(*)
|
| |
Common Stock(*)
|
| |
Additional
Paid-in
Capital(*)
|
| |
Subscription
Receivable
|
| |
Retained
Deficit
|
| |
Non-
controlling
Interest
|
| |
Total
Shareholders’
Equity
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||||||||
Balance December 31, 2021
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,124,399
|
| |
$(50,000)
|
| |
$(1,473,328)
|
| |
$4,297,767
|
| |
$7,909,939
|
Cash collected from subscription receivable
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
20,000
|
| |
—
|
| |
—
|
| |
20,000
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
2,724
|
| |
—
|
| |
—
|
| |
—
|
| |
2,724
|
Change in ownership interest in former subsidiary
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
33,751
|
| |
—
|
| |
—
|
| |
—
|
| |
33,751
|
Deconsolidation of former subsidiaries
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
—
|
| |
(4,265,167)
|
| |
(4,265,167)
|
Net Income (loss)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
324,827
|
| |
(32,600)
|
| |
292.227
|
Balance March 31, 2022
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,160,874
|
| |
$(30,000)
|
| |
$(1,148,501)
|
| |
$—
|
| |
$3,993,474
|
|
| |
Series Seed Convertible
Preferred Stock(*)
|
| |
Common Stock(*)
|
| |
Additional
Paid-in
Capital(*)
|
| |
Subscription
Receivable
|
| |
Retained
Deficit
|
| |
Non-
controlling
Interest
|
| |
Total
Shareholders’
Equity
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||||||||
Balance March 31, 2022
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,160,874
|
| |
$(30,000)
|
| |
$(1,148,501)
|
| |
$—
|
| |
$3,993,474
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
3,918
|
| |
—
|
| |
—
|
| |
—
|
| |
3,918
|
Net Loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(1,747,231)
|
| |
—
|
| |
(1,747,231)
|
Balance June 30, 2022
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,164,792
|
| |
$(30,000)
|
| |
$(2,895,732)
|
| |
$—
|
| |
$2,250,161
|
(*)
|
The number of shares has been retroactively restated to reflect the one for 0.434159 reverse stock split,
which was effective on July 21, 2023. The number of shares has been retroactively restated to reflect the two for one stock split, which was effective on January 6, 2023
|
|
| |
For the Six Months Ended June 30,
|
|||
|
| |
2023
|
| |
2022
|
Operating activities:
|
| |
|
| |
|
Net Loss
|
| |
$(17,374,354)
|
| |
$(1,422,404)
|
Adjustments to reconcile net loss to cash used in operating activities:
|
| |
|
| |
|
Depreciation and amortization expense
|
| |
110,083
|
| |
83,092
|
Amortization right-of-use asset
|
| |
144,802
|
| |
|
Stock compensation expense
|
| |
23,395
|
| |
6,642
|
Gain from sale of equity-method investments
|
| |
(440,000)
|
| |
(580,802)
|
Gain from sale of Part 135 certificate
|
| |
(387,000)
|
| |
—
|
Deferred income tax benefit
|
| |
—
|
| |
(80,000)
|
Loss (Gain) from equity-method investments
|
| |
(21,982)
|
| |
34,282
|
Amortization of debt discount
|
| |
92,860
|
| |
4,514
|
Changes in assets and liabilities:
|
| |
|
| |
|
Accounts receivable
|
| |
327,408
|
| |
(912,699)
|
Prepaid and other current assets
|
| |
171,196
|
| |
(1,453,495)
|
Other Deposits
|
| |
49,125
|
| |
11,332
|
Account payable and accrued liabilities
|
| |
4,154,127
|
| |
1,222,348
|
Lease liability operating lease
|
| |
(137,319)
|
| |
|
Accrued interest
|
| |
818,937
|
| |
242,111
|
Deposits on aircraft
|
| |
(1,850,000)
|
| |
(7,250,000)
|
Customers’ deposits
|
| |
1,063,217
|
| |
6,081,759
|
Net cash used in operating activities
|
| |
(13,255,505)
|
| |
(4,013,320)
|
Investing activities:
|
| |
|
| |
|
Cash payment for property, plant, and equipment
|
| |
(551,986)
|
| |
(175,328)
|
Payments for purchase of interest in equity-method investment
|
| |
(2,327,758)
|
| |
—
|
Proceeds from sale of interest in equity-method investment
|
| |
4,235,000
|
| |
6,575,000
|
Proceeds from the sale of Part 135 certificate
|
| |
350,000
|
| |
—
|
Payment from acquisition of GCA
|
| |
—
|
| |
(1,850,000)
|
Cash obtained from acquisition of GCA
|
| |
—
|
| |
678,963
|
Net cash provided by investing activities
|
| |
1,705,256
|
| |
5,228,635
|
Financing activities:
|
| |
|
| |
|
Proceeds from lines of credit
|
| |
1,000,000
|
| |
4,950,000
|
Proceeds from exercise of stock options
|
| |
22,057
|
| |
—
|
Proceeds from issuance of convertible notes
|
| |
10,670,000
|
| |
3,212,000
|
Proceeds from other loans
|
| |
—
|
| |
87,753
|
Repayment on loans
|
| |
(533,731)
|
| |
—
|
Collection on subscription receivable
|
| |
—
|
| |
20,000
|
Repayment of line of credit
|
| |
—
|
| |
(5,800,000)
|
Net cash provided by financing activities
|
| |
11,158,326
|
| |
2,469,753
|
Net (decrease) increase in cash
|
| |
(391,923)
|
| |
3,685,068
|
Cash and restricted cash, beginning of year
|
| |
7,878,683
|
| |
1,608,184
|
Cash and restricted cash, end of period
|
| |
$7,486,760
|
| |
$5,293,252
|
|
| |
|
| |
|
Supplemental disclosure of cash flow
information:
|
| |
|
| |
|
Cash paid for interest
|
| |
$689,598
|
| |
$—
|
Cash paid for income taxes
|
| |
$—
|
| |
$—
|
Non-Cash Investing and Financing
Activities:
|
| |
|
| |
|
Credit facility for the aircraft deposit
|
| |
$8,750,000
|
| |
$—
|
Conversion of line of credit to convertible note with related party
|
| |
$6,001,407
|
| |
$—
|
Original debt discount from notes
|
| |
$115,645
|
| |
$—
|
Payment from acquisition of GCA
|
| |
$—
|
| |
$1,850,000
|
Cash obtained from acquisition of GCA
|
| |
$—
|
| |
$678,963
|
Name of Consolidated Subsidiary or Entity
|
| |
State or Other
Jurisdiction of
Incorporation
or
Organization
|
| |
Attributable
Interest
|
Gulf Coast Aviation, Inc. renamed Volato Aircraft Management Service
|
| |
Texas
|
| |
100%
|
Fly Dreams LLC (until March 3, 2023)
|
| |
Georgia
|
| |
100%
|
•
|
Useful lives of property, plant, and equipment.
|
•
|
Assumptions used in valuing equity instruments.
|
•
|
Deferred income taxes and related valuation allowance.
|
•
|
Assessment of long-lived assets impairment.
|
•
|
Goodwill impairment.
|
•
|
Assumptions used in the determination of the fair value of the net assets acquired from GCA.
|
Classification
|
| |
Life
|
Machinery and equipment
|
| |
3-7 years
|
Automobiles
|
| |
5 years
|
Computer and office equipment
|
| |
5 years
|
Website development costs
|
| |
3 years
|
1.
|
Identification of the contract, or contracts, with a customer.
|
2.
|
Identification of the performance obligation(s) in the contract.
|
3.
|
Determination of the transaction price.
|
4.
|
Allocation of the transaction to the performance obligation(s) in the contract.
|
5.
|
Recognition of revenue when, or as the Company satisfies a performance obligation.
|
|
| |
Three Months Ended
June 30,
|
| |
Six Months Ended
June 30,
|
||||||
|
| |
2023
|
| |
2022
|
| |
2023
|
| |
2022
|
Revenue from management of aircraft recognized over time
|
| |
$1,839,148
|
| |
$583,704
|
| |
$2,918,627
|
| |
$766,647
|
Revenue from management of aircraft recognized at one
point in time
|
| |
3,064,936
|
| |
2,916,304
|
| |
6,054,000
|
| |
4,017,267
|
Revenue from charter flights and owner used recognized
over time
|
| |
8,109,782
|
| |
3,772,904
|
| |
13,997,198
|
| |
5,856,356
|
Revenue from the sale of aircraft recognized at one point
in time:
|
| |
—
|
| |
11,025,000
|
| |
5,710,000
|
| |
36,075,000
|
Total sources of revenue
|
| |
$13,013,866
|
| |
$18,297,912
|
| |
$28,679,825
|
| |
$46,715,270
|
|
| |
June 30, 2023
|
||||||
|
| |
Cost
|
| |
Accumulated
Amortization
|
| |
Net
|
Customer relationships
|
| |
$300,809
|
| |
$(79,612)
|
| |
$221,197
|
|
| |
December 31, 2022
|
||||||
|
| |
Cost
|
| |
Accumulated
Amortization
|
| |
Net
|
Customer relationships
|
| |
$300,809
|
| |
$(49,284)
|
| |
$251,525
|
Twelve Months ending June 30,
|
| |
Amount
|
2024
|
| |
$60,162
|
2025
|
| |
60,162
|
2026
|
| |
60,162
|
2027
|
| |
40,711
|
|
| |
$221,197
|
|
| |
June 30, 2023
|
| |
Remaining
Estimated
Useful Life (Years)
|
Intangible asset – Part 135 certificate
|
| |
$1,200,000
|
| |
Indefinite
|
|
| |
December 31, 2022
|
| |
Remaining
Estimated
Useful Life (Years)
|
Intangible assets – Part 135 certificates
|
| |
$1,363,000
|
| |
Indefinite
|
|
| |
June 30,
2023
|
| |
December 31,
2022
|
Machine and equipment
|
| |
$185,915
|
| |
$173,035
|
Automobiles
|
| |
101,787
|
| |
63,207
|
Website development costs
|
| |
373,880
|
| |
114,361
|
Computer and office equipment
|
| |
8,104
|
| |
8,104
|
Software development costs
|
| |
289,995
|
| |
48,988
|
|
| |
959,681
|
| |
407,695
|
Less accumulated depreciation
|
| |
(138,888)
|
| |
(59,133)
|
|
| |
$820,793
|
| |
$348,562
|
|
| |
June 30,
2023
|
| |
December 31,
2022
|
Gulfstream aircraft deposits
|
| |
$22,500,000
|
| |
$12,000,000
|
Honda aircraft deposits
|
| |
1,183,333
|
| |
833,333
|
Total deposits on aircraft
|
| |
$23,683,333
|
| |
$12,833,333
|
Less current portion
|
| |
(19,183,333)
|
| |
(833,333)
|
Total deposits on aircraft non-current
|
| |
$4,500,000
|
| |
$12,000,000
|
|
| |
June 30,
2023
|
| |
December 31,
2022
|
Investment in Volato 158 LLC
|
| |
$153,742
|
| |
$151,874
|
Investment in Volato 239 LLC
|
| |
—
|
| |
1,006,700
|
|
| |
$153,742
|
| |
$1,158,574
|
|
| |
June 30,
2023
|
| |
December 31,
2022
|
Dennis Liotta, December 2021 – 4% interest – secured
revolving loan, due January 2023
|
| |
$—
|
| |
$5,150,000
|
Dennis Liotta, March 2023 – 10% interest – promissory note due March 2024
|
| |
1,000,000
|
| |
—
|
Total notes from related party – current
|
| |
$1,000,000
|
| |
$5,150,000
|
|
| |
June 30,
2023
|
| |
December 31,
2022
|
Various investors, 5% coupon, due December 2023
|
| |
$19,129,000
|
| |
$18,879,000
|
Various investors, 4% coupon, due March 2024
|
| |
16,421,406
|
| |
—
|
Total unsecured convertible notes
|
| |
35,550,406
|
| |
18,879,000
|
Less unamortized debt discounts
|
| |
(41,363)
|
| |
(34,981)
|
Total unsecured convertible notes, net of discount
|
| |
$35,509,043
|
| |
$18,844,019
|
Less current portion
|
| |
(35,509,043)
|
| |
18,844,019
|
Total unsecured convertible notes, net of discount non-current
|
| |
$—
|
| |
$—
|
|
| |
June 30,
2023
|
| |
December 31,
2022
|
SAC Leasing G280 LLC credit facility, 12.5 % interest
|
| |
$13,000,000
|
| |
4,500,000
|
Less discounts
|
| |
(346,397)
|
| |
(329,994)
|
Total notes payable, net of discount
|
| |
$12,653,603
|
| |
4,170,006
|
|
| |
Number of
Shares
Authorized(*)
|
| |
Number of
Shares
Outstanding at
June 30,
2023
|
| |
Par
Value
|
Preferred Series Seed
|
| |
3,981,236
|
| |
3,981,236
|
| |
$0.001
|
Common Stock
|
| |
26,249,929
|
| |
7,313,371
|
| |
$0.001
|
(*)
|
Stock Split and Reverse Stock Split
|
|
| |
Options
|
| |
Weighted
Average
Exercise Price
Per Share
|
| |
Weighted
Average
Remaining
Contractual
Term (years)
|
Outstanding at December 31, 2022
|
| |
2,470,365
|
| |
$0.14
|
| |
9.4
|
Granted
|
| |
79,668
|
| |
$7.21
|
| |
—
|
Cancelled
|
| |
(301,017)
|
| |
$0.12
|
| |
—
|
Exercised
|
| |
(196,474)
|
| |
$0.12
|
| |
—
|
Outstanding at June 30, 2023
|
| |
2,052,542
|
| |
$0.41
|
| |
8.7
|
Exercisable at June 30, 2023
|
| |
614,102
|
| |
$0.16
|
| |
|
|
| |
Options
Outstanding
|
| |
Options
Exercisable
|
|||
Exercise Price
|
| |
Shares
|
| |
Life (in years)
|
| |
Shares
|
$ 0.12
|
| |
163,895
|
| |
8.1
|
| |
106,004
|
$ 0.14
|
| |
1,577,426
|
| |
9.2
|
| |
413,430
|
$ 0.16
|
| |
231,552
|
| |
4.0
|
| |
92,860
|
$ 7.21
|
| |
79,669
|
| |
9.9
|
| |
1,808
|
|
| |
2,052,542
|
| |
8.7
|
| |
614,102
|
|
| |
For The Six Months Ending
June 30,
|
|||
|
| |
2023
|
| |
2022
|
Expected term
|
| |
4
|
| |
4
|
Expected volatility
|
| |
30%
|
| |
30%
|
Expected dividends
|
| |
None
|
| |
None
|
Risk-free interest rate
|
| |
3.60%
|
| |
1.92%
|
Forfeitures
|
| |
None
|
| |
None
|
For the twelve months ended June 30,
|
| |
Gulfstream
G280 Fleet
|
2024
|
| |
$41,000,000
|
2025
|
| |
15,500,000
|
Total expected contractual payments
|
| |
$56,500,000
|
|
| |
|
| |
![]() |
|
| |
15821 Ventura Boulevard, Suite 490, Encino,
California 91436
Phone: (818) 461-0600 • Fax: (818) 461-0610
|
| |
Member of Russell Bedford International —
a global network of independent
professional services firms
|
|
| |
|
|
| |
|
|
| |
December 31,
2022(*)
|
| |
December 31,
2021(*)
|
ASSETS
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash
|
| |
$5,776,703
|
| |
$1,608,184
|
Accounts receivable
|
| |
1,879,672
|
| |
422,785
|
Deposits on aircraft
|
| |
833,334
|
| |
1,500,000
|
Prepaid expenses and other current assets
|
| |
2,210,946
|
| |
579,711
|
Total current assets
|
| |
10,700,655
|
| |
4,110,680
|
Fixed assets, net
|
| |
348,562
|
| |
10,495,883
|
Right-of-use operating assets
|
| |
1,574,144
|
| |
—
|
Equity-method investment
|
| |
1,158,574
|
| |
163,000
|
Deposits on aircraft
|
| |
12,000,000
|
| |
—
|
Other deposits
|
| |
124,143
|
| |
57,732
|
Restricted cash
|
| |
2,101,980
|
| |
—
|
Intangible – Customer list
|
| |
251,525
|
| |
—
|
Intangible Part 135 Certificates
|
| |
1,363,000
|
| |
163,000
|
Goodwill
|
| |
634,965
|
| |
—
|
Total assets
|
| |
$30,257,548
|
| |
$14,990,295
|
|
| |
|
| |
|
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)
|
| |
|
| |
|
Current liabilities
|
| |
|
| |
|
Accounts payable and accrued liabilities
|
| |
$2,882,589
|
| |
$519,245
|
Line of credit – related party
|
| |
5,150,000
|
| |
6,000,000
|
Convertible notes, net
|
| |
18,844,019
|
| |
—
|
Operating lease liability, current
|
| |
283,087
|
| |
—
|
Accrued interest
|
| |
780,606
|
| |
15,111
|
Other loans
|
| |
56,980
|
| |
—
|
Customers ‘deposits
|
| |
2,163,056
|
| |
546,000
|
Total current liabilities
|
| |
30,160,337
|
| |
7,080,356
|
Deferred income tax liability
|
| |
305,000
|
| |
—
|
Operating lease liability, non-current
|
| |
1,291,057
|
| |
—
|
Long term notes payable
|
| |
4,170,006
|
| |
—
|
Total liabilities
|
| |
35,926,400
|
| |
7,080,356
|
COMMITMENTS AND CONTINGENCIES (Note 14)
|
| |
|
| |
|
|
| |
|
| |
|
Shareholders’ equity (deficit)
|
| |
|
| |
|
Preferred Class Stock, par value $0.001
|
| |
3,981
|
| |
3,981
|
Common Stock, $0.001 par value
|
| |
7,120
|
| |
7,120
|
Additional paid-in capital
|
| |
5,175,307
|
| |
5,124,399
|
Stock subscriptions receivable
|
| |
(15,000)
|
| |
(50,000)
|
Accumulated deficit
|
| |
(10,840,260
|
| |
(1,473,328)
|
Total shareholders’ equity (deficit) attributable to Volato, Inc.
|
| |
(5,668,852)
|
| |
3,612,172
|
Non-controlling interest
|
| |
—
|
| |
4,297,767
|
Total shareholders’ equity (deficit)
|
| |
(5,668,852)
|
| |
7,909,939
|
Total liabilities and shareholders’ equity (deficit)
|
| |
$30,257,548
|
| |
$14,990,295
|
(*)
|
The number of shares has been retroactively restated to reflect the two for one stock split, which was
effective on January 6, 2023, and the one for 0.434159 reverse stock split, which was effective on July 21, 2023
|
|
| |
For the Years Ended
December 31,
|
|||
|
| |
2022
|
| |
2021
|
Revenue
|
| |
$96,706,478
|
| |
$1,055,849
|
Cost of revenue
|
| |
94,280,540
|
| |
853,288
|
Gross profit
|
| |
2,425,938
|
| |
202,561
|
|
| |
|
| |
|
Operating expenses
|
| |
|
| |
|
Salaries and benefits
|
| |
5,877,627
|
| |
861,548
|
Advertising expenses
|
| |
404,677
|
| |
387,873
|
Professional fees
|
| |
1,168,133
|
| |
335,650
|
General and administrative
|
| |
3,998,116
|
| |
786,132
|
Depreciation
|
| |
161,667
|
| |
26,243
|
Loss from operations
|
| |
(9,184,282)
|
| |
(2,194,885)
|
|
| |
|
| |
|
Other income (expenses)
|
| |
|
| |
|
Gain from deconsolidation of investments
|
| |
580,802
|
| |
757,611
|
Loss from equity-method investments
|
| |
(45,099)
|
| |
(12,000)
|
Other income
|
| |
60,102
|
| |
—
|
Interest income
|
| |
2,281
|
| |
—
|
Interest expense
|
| |
(868,336
|
| |
(57,911)
|
Other income (expenses)
|
| |
(270,250)
|
| |
687,700
|
|
| |
|
| |
|
Loss before provision for income taxes
|
| |
(9,454,532)
|
| |
(1,507,185)
|
Provision for incomes taxes (benefit)
|
| |
(55,000)
|
| |
—
|
Net Loss before non-controlling interest
|
| |
(9,399,532)
|
| |
(1,507,185)
|
Net Loss attributable to non-controlling interest
|
| |
(32,600)
|
| |
(33,857)
|
Net Loss attributable to Volato, Inc.
|
| |
$(9,366,932)
|
| |
$(1,473,328)
|
Basic and Diluted net loss per share(*)
|
| |
$(1.32)
|
| |
$(0.24)
|
Weighted average common share outstanding:
|
| |
|
| |
|
Basic and diluted(*)
|
| |
7,120,208
|
| |
6,143,083
|
(*)
|
The number of shares and per share amounts have been retroactively restated to reflect the two for one
stock split, which was effective on January 6, 2023, and the one for 0.434159 reverse stock split, which was effective on July 21, 2023
|
|
| |
Series Seed
Convertible
Preferred Stock(*)
|
| |
Common Stock(*)
|
| |
Additional
Paid-in
Capital(*)
|
| |
Subscription
Receivable
|
| |
Retained
Deficit
|
| |
Non-
controlling
Interest
|
| |
Total
Shareholders’
Equity
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||||||||
Original contribution for Fly Dreams LLC
|
| |
141,536
|
| |
$141
|
| |
—
|
| |
$—
|
| |
$162,859
|
| |
$—
|
| |
$—
|
| |
$
|
| |
$163,000
|
Common stock issued for cash
|
| |
|
| |
|
| |
7,120,208
|
| |
7,120
|
| |
46,380
|
| |
(30,000)
|
| |
—
|
| |
|
| |
23,500
|
Preferred stock issued for cash
|
| |
3,831,019
|
| |
3,831
|
| |
—
|
| |
—
|
| |
4,408,169
|
| |
(20,000)
|
| |
—
|
| |
|
| |
4,392,000
|
Preferred stock issued for cash-Fly Dreams LLC
|
| |
8,683
|
| |
9
|
| |
—
|
| |
—
|
| |
9,991
|
| |
—
|
| |
—
|
| |
|
| |
10,000
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
4,000
|
| |
—
|
| |
—
|
| |
|
| |
4,000
|
Change in ownership interest in former subsidiary
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
493,000
|
| |
—
|
| |
—
|
| |
|
| |
493,000
|
Capital contributions from LLC members
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
—
|
| |
6,605,624
|
| |
6,605,624
|
Deconsolidation of Volato 158 LLC
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(2,274,000)
|
| |
(2,274,000)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(1,473,328)
|
| |
(33,857)
|
| |
(1,507,185)
|
Balance December 31, 2021
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,124,399
|
| |
$(50,000)
|
| |
$(1,473,328)
|
| |
$4,297,767
|
| |
$7,909,939
|
(*)
|
The number of shares and per share amounts have been retroactively restated to reflect the two for one
stock split, which was effective on January 6, 2023, and the one for 0.434159 reverse stock split, which was effective on July 21, 2023
|
|
| |
Series Seed
Convertible
Preferred Stock(*)
|
| |
Common Stock(*)
|
| |
Additional
Paid-in
Capital(*)
|
| |
Subscription
Receivable
|
| |
Retained
Deficit
|
| |
Non-
controlling
Interest
|
| |
Total
Shareholders’
Equity
(Deficit)
|
||||||
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||||||||
Balance December 31, 2021
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,124,399
|
| |
$(50,000)
|
| |
$(1,473,328)
|
| |
$4,297,767
|
| |
$7,909,939
|
Cash collected from subscription receivable
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
35,000
|
| |
—
|
| |
—
|
| |
35,000
|
Stock-based compensation
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
17,157
|
| |
—
|
| |
—
|
| |
—
|
| |
17,157
|
Change in ownership interest in former subsidiary
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
33,751
|
| |
—
|
| |
—
|
| |
—
|
| |
33,751
|
Deconsolidation of former subsidiaries
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
—
|
| |
(4,265,167)
|
| |
(4,265,167)
|
Net loss
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
(9,366,932)
|
| |
(32,600)
|
| |
(9,399,532)
|
Balance December 31, 2022
|
| |
3,981,236
|
| |
$3,981
|
| |
7,120,208
|
| |
$7,120
|
| |
$5,175,307
|
| |
$(15,000)
|
| |
$(10,840,260)
|
| |
$—
|
| |
$(5,668,852)
|
(*)
|
The number of shares and per share amounts have been retroactively restated to reflect the two for one
stock split, which was effective on January 6, 2023, and the one for 0.434159 reverse stock split, which was effective on July 21, 2023
|
|
| |
For the Years ended
December 31,
|
|||
|
| |
2022
|
| |
2021
|
Operating activities:
|
| |
|
| |
|
Net Loss
|
| |
$(9,366,932)
|
| |
$(1,507,185)
|
Adjustments to reconcile net loss to cash used in operating activities:
|
| |
|
| |
|
Depreciation and amortization expense
|
| |
161,667
|
| |
26,243
|
Stock compensation expense
|
| |
17,157
|
| |
4,000
|
Gain from sale of equity-method investments
|
| |
(580,802)
|
| |
(757,611)
|
Loss from equity-method investments
|
| |
45,099
|
| |
12,000
|
Deferred income tax benefit
|
| |
(80,000)
|
| |
—
|
Amortization of debt discount
|
| |
42,040
|
| |
—
|
Changes in assets and liabilities:
|
| |
|
| |
|
Accounts receivable
|
| |
(2,222,712)
|
| |
(422,785)
|
Prepaid and other current assets
|
| |
(1,585,837)
|
| |
(579,711)
|
Deposits
|
| |
(66,411)
|
| |
(57,732)
|
Account payable and accrued liabilities
|
| |
1,451,375
|
| |
613,356
|
Accrued interest
|
| |
765,495
|
| |
15,111
|
Deposits on aircraft
|
| |
(11,333,334)
|
| |
(1,500,000)
|
Customers’ deposits
|
| |
1,320,865
|
| |
546,000
|
Net cash used in operating activities
|
| |
(21,432,330)
|
| |
(3,608,314)
|
Investing activities:
|
| |
|
| |
|
Cash payment for property, plant, and equipment
|
| |
(258,907)
|
| |
(14,689,626)
|
Proceeds from sale of interest in equity-method investment
|
| |
6,575,000
|
| |
2,875,000
|
Payment for acquisition of GCA
|
| |
(1,850,000)
|
| |
—
|
Cash obtained from acquisition of GCA
|
| |
678,963
|
| |
—
|
Net cash provided by (used in) investing activities
|
| |
5,145,056
|
| |
(11,814,626)
|
Financing activities:
|
| |
|
| |
|
Proceeds from lines of credit
|
| |
4,950,000
|
| |
13,000,000
|
Repayments of lines of credit
|
| |
(5,800,000)
|
| |
(5,700,000)
|
Collection on subscription receivable
|
| |
35,000
|
| |
—
|
Proceeds from issuance of convertible notes
|
| |
18,879,000
|
| |
—
|
Proceeds from other loans
|
| |
4,500,000
|
| |
—
|
Repayment on loans
|
| |
(6,227)
|
| |
—
|
Proceeds from contributions of LLC members
|
| |
—
|
| |
5,305,624
|
Proceeds from the sale of Series Seed preferred stock
|
| |
—
|
| |
4,402,000
|
Proceeds from sale of common stock
|
| |
—
|
| |
23,500
|
Net cash provided by financing activities
|
| |
22,557,773
|
| |
17,031,124
|
Net increase in cash
|
| |
6,270,499
|
| |
1,608,184
|
Cash and restricted cash, beginning of year
|
| |
1,608,184
|
| |
—
|
Cash and restricted cash, end of period
|
| |
$7,878,683
|
| |
$1,608,184
|
Supplemental disclosure of cash flow information:
|
| |
|
| |
|
Cash paid for interest
|
| |
$60,774
|
| |
$42,945
|
Cash paid for income taxes
|
| |
$—
|
| |
$—
|
Non-Cash Investing and Financing Activities:
|
| |
|
| |
|
Conversion of line of credit into interest in Volato 158 LLC
|
| |
$—
|
| |
$1,300,000
|
Issuance of series seed preferred stock for intangible asset
|
| |
$
|
| |
$163,000
|
Initial recognition of right-of-use asset
|
| |
$1,611,644
|
| |
$—
|
Fair value adjustment to equity-method investment upon deconsolidation
|
| |
$33,751
|
| |
$493,000
|
Acquisition of vehicle – direct finance
|
| |
$63,207
|
| |
$—
|
Name of Consolidated Subsidiary or Entity
|
| |
State or Other
Jurisdiction of
Incorporation
or
Organization
|
| |
Attributable
Interest
|
Fly Dreams LLC
|
| |
Georgia
|
| |
100%
|
Gulf Coast Aviation, Inc. (“GCA”)
|
| |
Texas
|
| |
100%
|
•
|
Useful lives of property, plant, and equipment.
|
•
|
Assumptions used in valuing equity instruments.
|
•
|
Deferred income taxes and related valuation allowance.
|
•
|
Assessment of long-lived assets impairment.
|
•
|
Goodwill impairment.
|
•
|
Assumptions used in the determination of the fair value of the net assets acquired from GCA.
|
Classification
|
| |
Life
|
Machinery and equipment
|
| |
3-7 years
|
Automobiles
|
| |
5 years
|
Computer and office equipment
|
| |
5 years
|
Website development costs
|
| |
3 years
|
1.
|
Identification of the contract, or contracts, with a customer.
|
2.
|
Identification of the performance obligation(s) in the contract.
|
3.
|
Determination of the transaction price.
|
4.
|
Allocation of the transaction to the performance obligation(s) in the contract.
|
Revenue from management of aircraft recognized over time:
|
| |
$2,534,631
|
Revenue from management of aircraft recognized at one point in time:
|
| |
$10,448,812
|
Revenue from charter fights and owner usage recognized over time:
|
| |
$16,028,035
|
Revenue from the sale of aircraft recognized at one point in time:
|
| |
$67,695,000
|
Revenue from management of aircraft recognized over time:
|
| |
$64,157
|
Revenue from management of aircraft recognized at one point in time:
|
| |
$135,748
|
Revenue from charter fights and owner usage recognized over time:
|
| |
$855,944
|
|
| |
March 11, 2022
|
Cash
|
| |
$1,850,000
|
Other consideration transferred
|
| |
—
|
Purchase price
|
| |
$1,850,000
|
|
| |
March 11, 2022
|
Cash
|
| |
$678,963
|
Accounts receivable
|
| |
246,675
|
Other current assets
|
| |
45,398
|
Fixed Assets
|
| |
5,455
|
Certificate
|
| |
1,200,000
|
Customer Relationships
|
| |
300,809
|
Deferred tax liability
|
| |
(385,000)
|
Accounts Payable and Accrued Expenses
|
| |
(877,265)
|
Net Assets Acquired
|
| |
$1,215,035
|
Goodwill
|
| |
634,965
|
Total consideration
|
| |
$1,850,000
|
|
| |
Years ended December 31,
|
|||
|
| |
2022
(Proforma)*
|
| |
2021
(Proforma)
|
Revenue
|
| |
$98,470,671
|
| |
$14,206,376
|
Net loss
|
| |
$(9,311,606)
|
| |
$(1,301,360)
|
*
|
Includes full year of GCA results, of which 9.5 months are included in the audited consolidated financial statements for the
year ended December 31, 2022.
|
|
| |
December 31, 2022
|
||||||
|
| |
Cost
|
| |
Accumulated
Amortization
|
| |
Net
|
Customer relationships
|
| |
$300,809
|
| |
$(49,284)
|
| |
$251,525
|
|
| |
$300,809
|
| |
$(49,284)
|
| |
$251,525
|
Fiscal years ending December 31,
|
| |
Amount
|
2023
|
| |
$60,162
|
2024
|
| |
60,162
|
2025
|
| |
60,162
|
2026
|
| |
60,162
|
2027
|
| |
10,877
|
|
| |
$251,525
|
|
| |
December 31, 2022
|
| |
Remaining
Estimated
Useful Life (Years)
|
Intangible asset – Part 135 certificates
|
| |
$1,363,000
|
| |
Indefinite
|
|
| |
December 31,
2022
|
| |
December 31,
2021
|
Aircraft
|
| |
$—
|
| |
$10,442,000
|
Machine and equipment
|
| |
173,035
|
| |
80,126
|
Automobiles
|
| |
63,207
|
| |
—
|
Website development costs
|
| |
114,361
|
| |
—
|
Computer and office equipment
|
| |
8,104
|
| |
—
|
Software development costs
|
| |
48,988
|
| |
—
|
|
| |
407,695
|
| |
10,522,126
|
Less accumulated depreciation
|
| |
(59,133)
|
| |
(26,243)
|
|
| |
$348,562
|
| |
$10,495,883
|
|
| |
December 31,
2022
|
| |
December 31,
2021
|
Gulfstream aircraft deposits
|
| |
$12,000,000
|
| |
$—
|
Honda aircraft deposits
|
| |
833,333
|
| |
1,500,000
|
Total deposits on aircraft
|
| |
$12,833,333
|
| |
$1,500,000
|
Less current portion
|
| |
(833,333)
|
| |
(1,500,000)
|
Total deposits on aircraft non-current
|
| |
$12,000,000
|
| |
$—
|
|
| |
December 31,
2022
|
| |
December 31,
2021
|
Dennis Liotta, December 2021 – 4% interest – secured
revolving loan, due January 2023
|
| |
$5,150,000
|
| |
$6,000,000
|
Total Line of credit related party
|
| |
$5,150,000
|
| |
$6,000,000
|
|
| |
December 31,
2022
|
| |
December 31,
2021
|
Various investors, 5% coupon, due December 2023
|
| |
$18,879,000
|
| |
$—
|
Total convertible notes
|
| |
18,879,000
|
| |
—
|
Less unamortized debt discounts
|
| |
(34,981)
|
| |
—
|
Total convertible notes, net of discount
|
| |
$18,844,019
|
| |
$—
|
|
| |
December 31,
2022
|
| |
December 31,
2021
|
SAC Leasing G280 LLC credit facility, 12.5 % interest
|
| |
$4,500,000
|
| |
—
|
Less discounts
|
| |
(329,994)
|
| |
—
|
Total notes payable, net of discount
|
| |
$4,170,006
|
| |
—
|
|
| |
Number of
Shares
Authorized
|
| |
Number of
Shares
Outstanding at
December 31,
2022
|
| |
Par
Value
|
Preferred Series Seed(*)
|
| |
3,981,236
|
| |
3,981,236
|
| |
$0.001
|
Common Stock(*)
|
| |
13,621,739
|
| |
7,120,208
|
| |
$0.001
|
(*)
|
The above table reflects the two-for-one stock split approved by the shareholders on November 15, 2022, which was effective on
January 6, 2023, and the one-for-0.434159 reverse stock split approved by the shareholders and effective July 21, 2023, before issuance of the consolidated financial statements.
|
|
| |
Options
|
| |
Weighted
Average
Exercise Price
Per Share
|
| |
Weighted
Average
Remaining
Contractual
Term (years)
|
Outstanding at January 1, 2021
|
| |
—
|
| |
$—
|
| |
—
|
Granted
|
| |
604,349
|
| |
$0.12
|
| |
10.0
|
Cancelled
|
| |
—
|
| |
$—
|
| |
—
|
Exercised
|
| | | |
$—
|
| |
—
|
|
Outstanding at December 31, 2021
|
| |
604,349
|
| |
$0.12
|
| |
9.6
|
Exercisable at December 31, 2021
|
| |
51,520
|
| |
$0.12
|
| |
|
|
| |
Options
|
| |
Weighted
Average
Exercise Price
Per Share
|
| |
Weighted
Average
Remaining
Contractual
Term (years)
|
Outstanding at January 1, 2021
|
| |
604,349
|
| |
$0.12
|
| |
9.6
|
Granted
|
| |
1,866,015
|
| |
$0.14
|
| |
10.0
|
Cancelled
|
| |
—
|
| |
$—
|
| |
—
|
Exercised
|
| |
—
|
| |
$—
|
| |
—
|
Outstanding at December 31, 2022
|
| |
2,470,364
|
| |
$0.14
|
| |
9.4
|
Exercisable at December 31, 2022
|
| |
344,304
|
| |
$0.12
|
| |
|
|
| |
Options
Outstanding
|
| |
Options
Exercisable
|
|||
Exercise Price
|
| |
Shares
|
| |
Life (in years)
|
| |
Shares
|
$ 0.12
|
| |
604,349
|
| |
8.6
|
| |
226,268
|
$ 0.14
|
| |
1,721,295
|
| |
9.8
|
| |
118,036
|
$ 0.16
|
| |
144,720
|
| |
9.2
|
| |
—
|
|
| |
2,470,364
|
| |
9.4
|
| |
334,304
|
|
| |
For Years Ending December 31,
|
|||
|
| |
2022
|
| |
2021
|
Expected term
|
| |
5.50 – 6.25
|
| |
5.00 – 6.25
|
Expected volatility
|
| |
30%
|
| |
30%
|
Expected dividends
|
| |
None
|
| |
None
|
Risk-free interest rate
|
| |
1.92%-3.99%
|
| |
1.08%
|
Forfeitures
|
| |
None
|
| |
None
|
|
| |
2022
|
| |
2021
|
Deferred Tax Assets
|
| |
|
| |
|
Investment in Plane Cos LLC
|
| |
$168,000
|
| |
$213,000
|
Loss carryforwards
|
| |
2,791,000
|
| |
1,543,000
|
Other
|
| |
65,000
|
| |
26,000
|
Total deferred tax assets
|
| |
3,024,000
|
| |
1,782,000
|
Deferred Tax Liabilities
|
| |
|
| |
|
Fixed assets
|
| |
(399,000)
|
| |
(1,416,000)
|
Intangible assets
|
| |
(347,000)
|
| |
—
|
Total deferred tax liabilities
|
| |
(746,000)
|
| |
(1,416,000)
|
Less valuation allowance
|
| |
(2,583,000)
|
| |
(366,000)
|
Net deferred tax assets (liabilities)
|
| |
$(305,000)
|
| |
$—
|
|
| |
Gulfstream
|
For the years ended December 31,
|
| |
G280 Fleet
|
2023
|
| |
$27,000,000
|
2024
|
| |
40,000,000
|
Total expected contractual payments
|
| |
$67,000,000
|
For the years ended December 31,
|
| |
Operating
Leases
|
2023
|
| |
$456,750
|
2024
|
| |
463,753
|
2025
|
| |
471,019
|
2026
|
| |
478,557
|
2027
|
| |
162,126
|
TOTAL
|
| |
$ 2,032,205
|
Less amount representing interest
|
| |
458,061
|
Present value of net minimum payments
(inc. $283,087 classified as current operating lease liability)
|
| |
$1,574,144
|
|
| |
June 30,
2023
(unaudited)
|
| |
December 31,
2022
(audited)
|
ASSETS
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash
|
| |
$
|
| |
$
|
Prepaid expenses
|
| |
|
| |
|
Total current assets
|
| |
|
| |
|
Investments held in Trust
|
| |
|
| |
|
Total Assets
|
| |
$
|
| |
$
|
|
| |
|
| |
|
LIABILITIES, TEMPORARY EQUITY AND
STOCKHOLDERS’ EQUITY
|
| |
|
| |
|
Current Liabilities:
|
| |
|
| |
|
Accrued expenses
|
| |
|
| |
|
Excise tax payable
|
| |
|
| |
|
Income tax payable
|
| |
|
| |
|
Total current liabilities
|
| |
|
| |
|
Deferred income taxes
|
| |
|
| |
|
Total Liabilities
|
| |
|
| |
|
|
| |
|
| |
|
Commitments and contingencies (Note 5)
|
| |
|
| |
|
|
| |
|
| |
|
Temporary Equity:
|
| |
|
| |
|
Class A common stock subject to possible redemption; $
|
| |
|
| |
|
|
| |
|
| |
|
Stockholders’ Equity (Deficit):
|
| |
|
| |
|
Preferred stock, $
|
| |
|
| |
|
Class A common stock, $
|
| |
|
| |
|
Class B common stock, $
|
| |
|
| |
|
(Accumulated Deficit) Retained earnings
|
| |
(
|
| |
|
Total Stockholders’ (Deficit) Equity
|
| |
(
|
| |
|
Total Liabilities, Temporary Equity and Stockholders’
(Deficit) Equity
|
| |
$
|
| |
$
|
|
| |
For the
Three Months Ended
June 30,
2023
|
| |
For the
Three Months Ended
June 30,
2022
|
Formation and operating expenses
|
| |
$
|
| |
$
|
Operating loss
|
| |
(
|
| |
(
|
|
| |
|
| |
|
Interest income - investments held in Trust Account
|
| |
|
| |
|
Other income
|
| |
|
| |
|
Income (loss) before income tax
|
| |
|
| |
(
|
Income tax expense
|
| |
(
|
| |
(
|
Net income (loss)
|
| |
$
|
| |
$(
|
Class A common stock - weighted average shares
outstanding, basic and diluted
|
| |
|
| |
|
Class A common stock - basic and diluted net income (loss)
per share
|
| |
$
|
| |
$
|
Class B common stock - weighted average shares
outstanding, basic and diluted
|
| |
|
| |
|
Class B common stock - basic and diluted net income (loss)
per share
|
| |
$
|
| |
$
|
|
| |
For the
Six Months Ended
June 30, 2023
|
| |
For the
Six Months Ended
June 30, 2022
|
|
| |
|
| |
|
Formation and operating expenses
|
| |
$
|
| |
$
|
Operating loss
|
| |
(
|
| |
(
|
|
| |
|
| |
|
Interest income - investments held in Trust Account
|
| |
|
| |
|
Other income
|
| |
|
| |
|
|
| |
|
| |
|
Income (loss) before income tax
|
| |
|
| |
(
|
Income tax expense
|
| |
(
|
| |
(
|
Net income (loss)
|
| |
$
|
| |
$(
|
Class A common stock - weighted average shares
outstanding, basic and diluted
|
| |
|
| |
|
Class A common stock - basic and diluted net income (loss)
per share
|
| |
$
|
| |
$(
|
Class B common stock - weighted average shares
outstanding, basic and diluted
|
| |
|
| |
|
Class B common stock - basic and diluted net income (loss)
per share
|
| |
$
|
| |
$(
|
|
| |
Class B
Common Stock
|
| |
Additional
Paid-in
Capital
|
| |
Retained
Earnings
(Accumulated
Deficit)
|
| |
Total
Stockholders’
Equity (Deficit)
|
|||
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balance, December 31, 2022
|
| |
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
Remeasurement of Class A Common Stock to redemption value
|
| |
—
|
| |
—
|
| |
|
| |
(
|
| |
(
|
Net income
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Balance, March 31, 2023
|
| |
|
| |
|
| |
|
| |
|
| |
|
Excise tax on Class A Common Stock redemptions
|
| |
—
|
| |
—
|
| |
|
| |
(
|
| |
(
|
Remeasurement of Class A Common Stock to redemption value
|
| |
—
|
| |
—
|
| |
|
| |
(
|
| |
(
|
Net income
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Balance, June 30, 2023
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
|
| |
Class B
Common Stock
|
| |
Additional
Paid-in
Capital
|
| |
Accumulated
Deficit
|
| |
Total
Stockholders’
Deficit
|
|||
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balance, December 31, 2021
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Net loss
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Balance, March 31, 2022
|
| |
|
| |
|
| |
|
| |
(
|
| |
(
|
Remeasurement of Class A Common Stock to redemption value
|
| |
—
|
| |
—
|
| |
|
| |
(
|
| |
(
|
Net loss
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Balance, June 30, 2022
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
|
| |
For the
Six Months Ended
June 30,
2023
|
| |
For the
Six Months Ended
June 30,
2022
|
Cash flows from operating activities:
|
| |
|
| |
|
Net income (loss)
|
| |
$
|
| |
$(
|
Adjustments to reconcile net income
(loss) to net cash used in operating activities:
|
| |
|
| |
|
Income earned on Trust assets
|
| |
(
|
| |
(
|
Changes in operating assets and liabilities:
|
| |
|
| |
|
Prepaid expenses
|
| |
|
| |
|
Income taxes payable
|
| |
|
| |
|
Deferred income taxes
|
| |
(
|
| |
|
Accrued expenses
|
| |
|
| |
|
Net cash used in operating activities
|
| |
(
|
| |
(
|
|
| |
|
| |
|
Cash flows from investing activities:
|
| |
|
| |
|
Deposit into Trust Account for extension
|
| |
(
|
| |
|
Withdrawal from Trust Account for redemptions
|
| |
|
| |
|
Withdrawal from Trust Account for working capital and tax
|
| |
|
| |
|
Net cash provided by investing activities
|
| |
|
| |
|
|
| |
|
| |
|
Cash flows from financing activities:
|
| |
|
| |
|
Trust redemptions
|
| |
(
|
| |
|
Net cash used in financing activities
|
| |
(
|
| |
|
|
| |
|
| |
|
|
| |
|
| |
|
Net change in cash
|
| |
|
| |
(
|
Cash at beginning of period
|
| |
|
| |
|
Cash at end of period
|
| |
$
|
| |
$
|
|
| |
|
| |
|
Non-cash financing activities:
|
| |
|
| |
|
Excise tax on redemption of Class A common stock subject
to possible redemption
|
| |
$
|
| |
$
|
Remeasurement of Class A common stock subject to possible
redemption
|
| |
$
|
| |
$
|
|
| |
For the Three Months
Ended June 30, 2023
|
| |
For the Three Months
Ended June 30, 2022
|
||||||
|
| |
Class A
|
| |
Class B
|
| |
Class A
|
| |
Class B
|
Basic and diluted net income per share
|
| |
|
| |
|
| |
|
| |
|
Numerator:
|
| |
|
| |
|
| |
|
| |
|
Allocation of net income (loss)
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Denominator:
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted weighted average shares outstanding
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted net income (loss) per share
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
|
| |
For the Six Months
Ended June 30, 2023
|
| |
For the Six Months
Ended June 30, 2022
|
||||||
|
| |
Class A
|
| |
Class B
|
| |
Class A
|
| |
Class B
|
Basic and diluted net income per share
|
| |
|
| |
|
| |
|
| |
|
Numerator:
|
| |
|
| |
|
| |
|
| ||
Allocation of net income (loss)
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Denominator:
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted weighted average shares outstanding
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted net income (loss) per share
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
•
|
Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets;
|
•
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such
as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
•
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop
its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
•
|
in whole and not in part;
|
•
|
at a price of $
|
•
|
upon a minimum of
|
•
|
if, and only if, the last reported sale price of the Class A common stock equals or exceeds $
|
•
|
in whole and not in part;
|
•
|
at a price of $
|
•
|
upon a minimum of
|
•
|
if, and only if, the last reported sale price of our Class A common stock equals or exceeds $
|
•
|
if, and only if, the private placement warrants are also concurrently exchanged at the same price (equal to a number of
Class A common stock) as the outstanding public warrants, as described above.
|
Class A common stock subject to possible redemption at December 31, 2022
|
| |
$
|
Re-measurement of carrying value to redemption value
|
| |
|
Class A common stock subject to possible redemption at March 31, 2023
|
| |
|
Re-measurement of carrying value to redemption value
|
| |
|
Extension deposit
|
| |
|
Redemption
|
| |
(
|
Class A common stock subject to possible redemption at June 30, 2023
|
| |
$
|
Description
|
| |
Level
|
| |
June 30,
2023
|
| |
December 31,
2022
|
Assets:
|
| |
|
| |
|
| |
|
Marketable securities held in the Trust Account
|
| |
1
|
| |
$
|
| |
$
|
|
| |
December 31,
2022
|
| |
December 31,
2021
|
ASSETS
|
| |
|
| |
|
Current assets:
|
| |
|
| |
|
Cash
|
| |
$
|
| |
$
|
Prepaid expenses
|
| |
|
| |
|
Total current assets
|
| |
|
| |
|
Investments held in Trust
|
| |
|
| |
|
Total Assets
|
| |
$
|
| |
$
|
|
| |
|
| |
|
LIABILITIES, TEMPORARY EQUITY AND
STOCKHOLDERS’ EQUITY (DEFICIT)
|
| |
|
| |
|
Current Liabilities:
|
| |
|
| |
|
Accrued expenses
|
| |
$
|
| |
$
|
Total current liabilities
|
| |
|
| |
|
Deferred underwriting commission
|
| |
|
| |
|
Total Liabilities
|
| |
|
| |
|
|
| |
|
| |
|
Commitments and contingencies (Note 5)
|
| |
|
| |
|
|
| |
|
| |
|
Temporary Equity:
|
| |
|
| |
|
Class A Common Stock subject to possible redemption; $
|
| |
|
| |
|
|
| |
|
| |
|
Stockholders’ Equity (Deficit):
|
| |
|
| |
|
Preferred stock, $
|
| |
|
| |
|
Class A Common Stock, $
|
| |
|
| |
|
Class B Common Stock, $
|
| |
|
| |
|
Retained earnings (Accumulated deficit)
|
| |
|
| |
(
|
Total Stockholders’ Equity (Deficit)
|
| |
|
| |
(
|
Total Liabilities, Temporary Equity and Stockholders’ Equity
(Deficit)
|
| |
$
|
| |
$
|
|
| |
Year Ended
December 31,
2022
|
| |
For the period from
March 16, 2021
(inception) through
December 31,
2021
|
Formation and operating expenses
|
| |
$
|
| |
$
|
Operating loss
|
| |
(
|
| |
(
|
|
| |
|
| |
|
Interest income - investments held in Trust Account
|
| |
|
| |
|
Other income
|
| |
4,060,596
|
| |
1,183
|
Income (loss) before income tax
|
| |
|
| |
(
|
Income tax expense
|
| |
(
|
| |
|
Net income (loss)
|
| |
$
|
| |
$(
|
Class A Common Stock - weighted average shares
outstanding, basic and diluted
|
| |
|
| |
|
Class A Common Stock - basic and diluted net income (loss) per share
|
| |
$
|
| |
$(
|
Class B Common Stock - weighted average shares
outstanding, basic and diluted(1)
|
| |
|
| |
|
Class B Common Stock - basic and diluted net income (loss) per share
|
| |
$
|
| |
$(
|
(1)
|
On November 30, 2021, the Company effected a
|
|
| |
Class B
Common Stock
|
| |
Additional
Paid-in
Capital
|
| |
Retained
Earnings
Accumulated
Deficit
|
| |
Total
Stockholders’
Equity (Deficit)
|
|||
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balance, December 31, 2021
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Remeasurement of Class A Common Stock to redemption value
|
| |
—
|
| |
—
|
| |
|
| |
(
|
| |
(
|
Gain on deferred underwriting commission
|
| |
—
|
| |
—
|
| |
|
| |
|
| |
|
Net income
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Balance, December 31, 2022
|
| |
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
|
| |
Class B
Common Stock
|
| |
Additional
Paid-in
Capital
|
| |
Accumulated
Deficit
|
| |
Total
Stockholders’
Deficit
|
|||
|
| |
Shares
|
| |
Amount
|
| ||||||||
Balance, March 16, 2021 (inception)
|
| |
|
| |
$
|
| |
$
|
| |
$
|
| |
$
|
Issuance of Class B Common Stock to Sponsor(1)
|
| |
|
| |
|
| |
|
| |
|
| |
|
Private placement warrants proceeds in excess of fair
value
|
| |
—
|
| |
|
| |
|
| |
|
| |
|
Re-measurement of Class A Common Stock subject to possible
redemption to redemption value
|
| |
—
|
| |
|
| |
(
|
| |
(
|
| |
(
|
Net loss
|
| |
—
|
| |
|
| |
|
| |
(
|
| |
(
|
Balance, December 31, 2021
|
| |
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
(1)
|
|
|
| |
Year ended
December 31,
2022
|
| |
Period From
March 16, 2021
(inception) Through
December 31,
2021
|
Cash flows from operating activities:
|
| |
|
| |
|
Net income (loss)
|
| |
$
|
| |
$(
|
Adjustments to reconcile net income
(loss) to net cash used in operating activities:
|
| |
|
| |
|
Income earned on Trust assets
|
| |
(
|
| |
(
|
Changes in operating assets and liabilities:
|
| |
|
| |
|
Prepaid expenses
|
| |
|
| |
(
|
Accrued expenses
|
| |
|
| |
|
Net cash used in operating activities
|
| |
(
|
| |
(
|
|
| |
|
| |
|
Cash flows from investment activities:
|
| |
|
| |
|
Funds deposited into Trust Account
|
| |
|
| |
(
|
Net cash used in investing activities
|
| |
|
| |
(
|
|
| |
|
| |
|
Cash flows from financing activities:
|
| |
|
| |
|
Proceeds from issuance of Class B ordinary shares to Sponsor
|
| |
|
| |
|
Proceeds from sale of units
|
| |
|
| |
|
Proceeds from sale of warrants
|
| |
|
| |
|
Offering costs
|
| |
|
| |
(
|
Proceeds from sponsor note
|
| |
|
| |
|
Repayment of sponsor note
|
| |
|
| |
(
|
Net cash provided by financing activities
|
| |
|
| |
|
|
| |
|
| |
|
Net change in cash
|
| |
(
|
| |
|
Cash at beginning of period
|
| |
|
| |
|
Cash at end of period
|
| |
$
|
| |
$
|
|
| |
|
| |
|
Non-cash financing activities:
|
| |
|
| |
|
Deferred underwriting fee incurred (written off)
|
| |
$(
|
| |
$
|
Re-measurement of Class A ordinary shares subject to possible redemption
|
| |
$
|
| |
$(
|
Initial value of Class A Common Stock subject to possible redemption
|
| |
$
|
| |
$
|
|
| |
As
previously
reported
|
| |
Adjustments
|
| |
As
restated
|
March 31, 2022 balance sheet
|
| |
|
| |
|
| |
|
Prepaid expenses
|
| |
$
|
| |
$
|
| |
$
|
Total current assets
|
| |
|
| |
|
| |
|
Total assets
|
| |
|
| |
|
| |
|
Accumulated Deficit
|
| |
(
|
| |
|
| |
(
|
Total Stockholders’ Deficit
|
| |
(
|
| |
|
| |
(
|
Total Liabilities, Temporary Equity and Stockholders’ Deficit
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
Statement of changes in stockholders’
deficit for the three months ended March 31, 2022
|
| |
|
| |
|
| |
|
Net loss
|
| |
$(
|
| |
$
|
| |
$(
|
Accumulated Deficit - March 31, 2022
|
| |
(
|
| |
|
| |
(
|
Total Stockholders’ Deficit
|
| |
(
|
| |
|
| |
(
|
|
| |
|
| |
|
| |
|
Statement of operations for the three months March 31, 2022
|
| |
|
| |
|
| |
|
Formation and operating cost
|
| |
$
|
| |
$(
|
| |
$
|
Operating loss
|
| |
(
|
| |
|
| |
(
|
Net loss
|
| |
(
|
| |
|
| |
(
|
Class A Common Stock - basic and diluted net loss per share
|
| |
(
|
| |
|
| |
(
|
Class B Common Stock - basic and diluted net loss per share
|
| |
(
|
| |
|
| |
(
|
|
| |
|
| |
|
| |
|
Statement of cash flows for the three
months ended March 31, 2022
|
| |
|
| |
|
| |
|
Net loss
|
| |
$(
|
| |
$
|
| |
$(
|
Change in prepaid expenses
|
| |
|
| |
(
|
| |
|
|
| |
|
| |
|
| |
|
June 30, 2022 balance sheet
|
| |
|
| |
|
| |
|
Prepaid expenses
|
| |
|
| |
|
| |
|
Total current assets
|
| |
|
| |
|
| |
|
Total assets
|
| |
|
| |
|
| |
|
Accumulated Deficit
|
| |
(
|
| |
|
| |
(
|
Total Stockholders’ Deficit
|
| |
(
|
| |
|
| |
(
|
Total Liabilities, Temporary Equity and Stockholders’ Deficit
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
Statement of changes in stockholders’
deficit for the six months ended June 30, 2022
|
| |
|
| |
|
| |
|
Net loss
|
| |
$(
|
| |
$
|
| |
$(
|
Accumulated Deficit - June 30, 2022
|
| |
(
|
| |
|
| |
(
|
Total Stockholders’ Deficit
|
| |
(
|
| |
|
| |
(
|
|
| |
|
| |
|
| |
|
Statement of operations for the three months June 30, 2022
|
| |
|
| |
|
| |
|
Formation and operating cost
|
| |
$
|
| |
$(
|
| |
$
|
Operating loss
|
| |
|
| |
(
|
| |
|
Loss before income tax
|
| |
(
|
| |
|
| |
(
|
Net loss
|
| |
(
|
| |
|
| |
(
|
Class A Common Stock - basic and diluted net loss per share
|
| |
(
|
| |
|
| |
|
Class B Common Stock - basic and diluted net loss per share
|
| |
(
|
| |
|
| |
|
|
| |
As
previously
reported
|
| |
Adjustments
|
| |
As
restated
|
|
| |
|
| |
|
| |
|
Statement of operations for the six months June 30, 2022
|
| |
|
| |
|
| |
|
Formation and operating cost
|
| |
$
|
| |
$(
|
| |
$
|
Operating loss
|
| |
|
| |
(
|
| |
|
Loss before income tax
|
| |
(
|
| |
|
| |
(
|
Net loss
|
| |
(
|
| |
|
| |
(
|
Class A Common Stock - basic and diluted net loss per share
|
| |
(
|
| |
|
| |
(
|
Class B Common Stock - basic and diluted net loss per share
|
| |
(
|
| |
|
| |
(
|
|
| |
|
| |
|
| |
|
Statement of cash flows for the six months ended June 30,
2022
|
| |
|
| |
|
| |
|
Net loss
|
| |
$(
|
| |
$
|
| |
$(
|
Change in prepaid expenses
|
| |
|
| |
(
|
| |
|
|
| |
|
| |
|
| |
|
September 30, 2022 balance sheet
|
| |
|
| |
|
| |
|
Prepaid expenses
|
| |
$
|
| |
$
|
| |
$
|
Total current assets
|
| |
|
| |
|
| |
|
Total assets
|
| |
|
| |
|
| |
|
Accumulated Deficit
|
| |
(
|
| |
|
| |
(
|
Total Stockholders’ Deficit
|
| |
(
|
| |
|
| |
(
|
Total Liabilities, Temporary Equity and Stockholders’ Deficit
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
Statement of changes in stockholders’
deficit for the nine months ended September 30, 2022
|
| |
|
| |
|
| |
|
Net loss
|
| |
$(
|
| |
$
|
| |
$(
|
Accumulated Deficit - September 30, 2022
|
| |
(
|
| |
|
| |
(
|
Total Stockholders’ Deficit
|
| |
(
|
| |
|
| |
(
|
|
| |
|
| |
|
| |
|
Statement of operations for the three months September 30,
2022
|
| |
|
| |
|
| |
|
Formation and operating cost
|
| |
$
|
| |
$(
|
| |
$
|
Operating loss
|
| |
(
|
| |
|
| |
(
|
Income (loss) before income tax
|
| |
|
| |
|
| |
|
Net income
|
| |
|
| |
|
| |
|
Class A Common Stock - basic and diluted net loss per share
|
| |
|
| |
|
| |
|
Class B Common Stock - basic and diluted net loss per share
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
|
Statement of operations for the nine months September 30,
2022
|
| |
|
| |
|
| |
|
Formation and operating cost
|
| |
$
|
| |
$(
|
| |
$
|
Operating loss
|
| |
(
|
| |
|
| |
(
|
Income (loss) before income tax
|
| |
(
|
| |
|
| |
(
|
Net loss
|
| |
(
|
| |
|
| |
(
|
Class A Common Stock - basic and diluted net loss per share
|
| |
(
|
| |
|
| |
(
|
Class B Common Stock - basic and diluted net loss per share
|
| |
(
|
| |
|
| |
(
|
|
| |
|
| |
|
| |
|
Statement of cash flows for the nine
months ended September 30, 2022
|
| |
|
| |
|
| |
|
Net loss
|
| |
$(
|
| |
$
|
| |
$(
|
Change in prepaid expenses
|
| |
|
| |
(
|
| |
|
|
| |
For the Year
Ended December 31,
2022
|
| |
For the period from
March 16, 2021
(inception) through
December 31, 2021
|
||||||
|
| |
Class A
|
| |
Class B
|
| |
Class A
|
| |
Class B
|
Basic and diluted net income per share
|
| |
|
| |
|
| |
|
| |
|
Numerator:
|
| |
|
| |
|
| |
|
| |
|
Allocation of net income (loss)
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
Denominator:
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted weighted average shares outstanding
|
| |
|
| |
|
| |
|
| |
|
Basic and diluted net income (loss) per share
|
| |
$
|
| |
$
|
| |
$(
|
| |
$(
|
•
|
Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets;
|
•
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such
as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
•
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop
its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
•
|
in whole and not in part;
|
•
|
at a price of $
|
•
|
upon a minimum of
|
•
|
if, and only if, the last reported sale price of the Class A Common Stock equals or exceeds $
|
•
|
in whole and not in part;
|
•
|
at a price of $
|
•
|
upon a minimum of
|
•
|
if, and only if, the last reported sale price of our Class A Common Stock equals or exceeds $
|
•
|
if, and only if, the private placement warrants are also concurrently exchanged at the same price (equal to a number of
Class A Common Stock) as the outstanding public warrants, as described above.
|
Description
|
| |
December 31, 2021
|
Gross proceeds
|
| |
$
|
Less:
|
| |
|
Offering costs allocated to Class A Common Stock subject to possible redemption
|
| |
(
|
Private placement warrants proceeds in excess of fair value
|
| |
(
|
Plus:
|
| |
|
Re-measurement of carrying value to redemption value
|
| |
|
Class A Common Stock subject to possible redemption at December 31, 2021
|
| |
|
Re-measurement of carrying value to redemption value
|
| |
|
Class A Common Stock subject to possible redemption at December 31, 2022
|
| |
$
|
Description
|
| |
Level
|
| |
December 31, 2022
|
| |
December 31, 2021
|
Assets:
|
| |
|
| |
|
| |
|
Marketable securities held in the Trust Account
|
| |
1
|
| |
$
|
| |
$
|
|
| |
December 31, 2022
|
| |
December 31, 2021
|
Deferred tax assets:
|
| |
|
| |
|
Net operating losses
|
| |
$
|
| |
$
|
Start-up costs
|
| |
|
| |
|
Total deferred tax assets
|
| |
|
| |
|
Valuation Allowance
|
| |
(
|
| |
(
|
Deferred tax asset, net of allowance
|
| |
|
| |
|
Deferred tax liabilities:
|
| |
|
| |
|
Accrued investment income
|
| |
(
|
| |
|
Total deferred tax liabilities
|
| |
(
|
| |
|
Deferred tax liability, net
|
| |
$(
|
| |
$
|
|
| |
For the Year
Ended December 31, 2022
|
| |
For the Period From March 16,
2021 (Inception)
Through December 31, 2021
|
Federal
|
| |
|
| |
|
Current
|
| |
$
|
| |
$
|
Deferred
|
| |
|
| |
(
|
State and local
|
| |
|
| |
|
Current
|
| |
|
| |
|
Deferred
|
| |
|
| |
|
Change in valuation allowance
|
| |
|
| |
|
Income tax provision
|
| |
$
|
| |
$
|
|
| |
For the Year Ended December 31,
2022
|
| |
For the Period From March 16,
2021 (Inception) Through
December 31,
2021
|
U.S. federal statutory rate
|
| |
|
| |
|
NOL true up
|
| |
|
| |
|
Valuation allowance
|
| |
|
| |
(
|
Income tax provision
|
| |
|
| |
|
|
| |
|
| |
|
| |
Page
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | |
|
| |
|
| |
|
| |
Page
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Page
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| |
|
| |
|
| |
|
| | ||||||||
|
| |
|
| |
|
| |
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | |
|
| |
|
| |
|
| |
Page
|
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | | |||
|
| | | | | |
Exhibits
|
| |
|
Exhibit A
|
| |
Sponsor Support Agreement
|
Exhibit B
|
| |
Amended RSRA
|
Exhibit C
|
| |
Lock-Up Agreement
|
Exhibit D
|
| |
PACI Certificate of Incorporation
|
Exhibit E
|
| |
PACI Bylaws
|
Exhibit F-1
|
| |
Incentive Equity Plan
|
Exhibit F-2
|
| |
A&R Company Incentive Plan
|
Exhibit G-1
|
| |
Form of Employment Agreement (Liotta)
|
Exhibit G-2
|
| |
Form of Employment Agreement (Cooper)
|
Exhibit G-3
|
| |
Form of Employment Agreement (Rabin)
|
Exhibit G-4
|
| |
Form of Employment Agreement (Prachar)
|
Exhibit G-5
|
| |
Form of Employment Agreement (Drucker)
|
|
| |
(a)
|
| |
If to PACI or Merger Sub, to:
|
|||
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
PROOF Acquisition Corp I
|
|
| |
|
| |
|
| |
Attention: John C. Backus, CEO
|
|
| |
|
| |
|
| |
11911 Freedom Dr., Suite 1080
|
|
| |
|
| |
|
| |
Reston, VA 20190
|
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Email: backus@proof.vc
|
|
| |
|
| |
|
| |
|
|
| |
with copies to (which shall not constitute notice):
|
||||||
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Steptoe & Johnson, LLP
|
|
| |
|
| |
|
| |
Attention: Scott D. Fisher
|
|
| |
|
| |
|
| |
1114 Avenue of the Americas
|
|
| |
|
| |
|
| |
New York, NY, 10036
|
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Email: sfisher@Steptoe.com
|
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
And
|
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
PROOF Acquisition Sponsor I, LLC
|
|
| |
|
| |
|
| |
Attention: Michael W. Zarlenga
|
|
| |
|
| |
|
| |
11911 Freedom Dr., Suite 1080
|
|
| |
|
| |
|
| |
Reston, VA 21090
|
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Email: michael@proof.vc
|
|
| |
|
| |
|
| |
|
|
| |
(b)
|
| |
If to the Company:
|
|||
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Volato, Inc.
|
|
| |
|
| |
|
| |
Attention: Matthew Liotta, CEO
|
|
| |
|
| |
|
| |
1954 Airport Rd., Ste. 124
|
|
| |
|
| |
|
| |
Chamblee, GA 30341
|
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Email: matt.liotta@flyvolato.com
|
|
| |
|
| |
|
| |
|
|
| |
with copies to (which shall not constitute notice):
|
||||||
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Womble Bond Dickinson (US) LLP
|
|
| |
|
| |
|
| |
Attention: F. Reid Avett
|
|
| |
|
| |
|
| |
2001 K Street, N.W., Suite 400 South
|
|
| |
|
| |
|
| |
Washington, DC 20016
|
|
| |
|
| |
|
| |
|
|
| |
|
| |
|
| |
Email: reid.avett@wbd-us.com
|
PROOF ACQUISITION CORP I
|
| |
VOLATO, INC.
|
|
| |
|
/s/ John C. Backus, Jr.
|
| |
/s/ Matthew Liotta
|
By: John C. Backus, Jr.
|
| |
By: Matthew Liotta
|
Its: President & Chief Executive Officer
|
| |
Its: Chief Executive Officer
|
|
| |
|
PROOF MERGER SUB, INC.
|
| |
|
|
| |
|
/s/ John C. Backus, Jr.
|
| |
|
By: John C. Backus, Jr.
|
| |
|
Its: President
|
| |
|
|
| |
PROOF ACQUISITION CORP I
|
|||
|
| |
|
| |
|
|
| |
By:
|
| |
|
|
| |
Name:
|
| |
|
|
| |
Title:
|
| |
|
1.
|
Definitions
|
2.
|
Purpose
|
3.
|
Administration of the Plan
|
4.
|
Effective Date
|
5.
|
Shares of Stock Subject to the Plan; Award Limitations
|
6.
|
Eligibility
|
7.
|
Options
|
8.
|
Stock Appreciation Rights
|
9.
|
Restricted Awards
|
10.
|
Performance Awards
|
11.
|
Phantom Stock Awards
|
12.
|
Other Cash-Based Awards and Other Stock-Based Awards
|
13.
|
Dividends and Dividend Equivalents
|
14.
|
Change of Control
|
15.
|
Withholding
|
16.
|
Amendment and Termination of the Plan and Awards
|
17.
|
Restrictions on Awards and Shares; Compliance with Applicable Law
|
18.
|
No Right or Obligation of Continued Employment or Service or to Awards; Compliance with the Plan
|
19.
|
General Provisions
|
20.
|
Compliance with Code Section 409A
|
(i)
|
reviewed a draft, dated July 26, 2023, of the Business Combination Agreement;
|
(ii)
|
reviewed certain publicly available business and financial information and other data relating to PACI and Volato that we
deemed to be relevant;
|
(iii)
|
reviewed certain information relating to the historical, current and future operations, financial condition and prospects of
Volato made available to us by Volato and PACI, including financial projections prepared by the management of Volato relating to Volato;
|
(iv)
|
held discussions with certain members of the management of PACI and of Volato and certain of their respective representatives
and advisors regarding the business, operations, financial condition and prospects of Volato and related matters;
|
(v)
|
reviewed publicly available information with respect to certain other companies in lines of business we believe to be
generally relevant in evaluating the business of Volato; and
|
(vi)
|
conducted such other financial studies, analyses and investigations as we deemed appropriate.
|
|
| |
Very truly yours,
|
|
| |
/s/ LSH Partners Securities LLC
|
|
| |
LSH Partners Securities LLC
|
Exhibit Number
|
| |
|
| |
Business Combination Agreement, dated as of August 1, 2023, by and among PROOF
Acquisition Corp I, PACI Merger Corp, Inc., and Volato, Inc. (included as Annex A to this proxy statement/prospectus included in this Registration Statement).
|
|
| |
Amended and Restated Certificate of Incorporation of PROOF Acquisition Corp I
(incorporated by reference to Exhibit 3.1 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on December 6, 2021).
|
|
| |
Certificate of Amendment of Amended and Restated Certificate of Incorporation
of PROOF Acquisition Corp I (incorporated by reference to Exhibit 3.1 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on May 25, 2023).
|
|
| |
Form of Amended and Restated Certificate of Incorporation of Volato Group, Inc.
(included as Annex B to the proxy statement/ prospectus included in this Registration Statement).
|
|
| |
Amended and Restated Bylaws of PROOF Acquisition Corp I (incorporated by
reference to Exhibit 3.2 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on December 6, 2021).
|
|
| |
Form of Bylaws of Volato Group, Inc.
|
|
| |
Specimen Unit Certificate of PROOF Acquisition Corp I (incorporated by
reference to Exhibit 4.1 to PROOF Acquisition Corp I’s Registration Statement on Form S-1/A (File No. 333-261015) filed with the SEC on November 23, 2021).
|
|
| |
Specimen Class A Common Stock Certificate of PROOF Acquisition Corp I
(incorporated by reference to Exhibit 4.2 to PROOF Acquisition Corp I’s Registration Statement on Form S-1/A (File No. 333-261015) filed with the SEC on November 23, 2021).
|
|
| |
Specimen Warrant Certificate of PROOF Acquisition Corp I (incorporated by
reference to Exhibit 4.3 to PROOF Acquisition Corp I’s Registration Statement on Form S-1/A (File No. 333-261015) filed with the SEC on November 23, 2021).
|
|
| |
Warrant Agreement, dated November 30, 2021, by and between PROOF Acquisition
Corp I and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 4.1 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on December 6, 2021).
|
|
5.1*
|
| |
Opinion of Steptoe & Johnson LLP with respect to the legality of the
securities being registered.
|
8.1*
|
| |
Opinion of Steptoe & Johnson LLP regarding certain U.S. tax matters.
|
| |
Form of 2023 Stock Incentive Plan (included as Annex C to the proxy
statement/prospectus included in this Registration Statement).
|
|
| |
2021 Equity Incentive Plan.
|
|
| |
Private Placement Warrants Purchase Agreement, dated November 30, 2021, by and
between PROOF Acquisition Corp I and PROOF Acquisition Sponsor I, LLC (incorporated by reference to Exhibit 10.1 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on December 6, 2021).
|
|
| |
Investment Management Trust Agreement, dated November 30, 2021, by and between
PROOF Acquisition Corp I and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 10.2 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on December 6,
2021).
|
|
| |
Amendment No.1 to Investment Management Trust Agreement, dated May 23, 2023 by
and between PROOF Acquisition Corp I and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 10.1 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on
May 25, 2023).
|
|
| |
Registration and Stockholder Rights Agreement, dated November 30, 2021, by and
among PROOF Acquisition Corp I, PROOF Acquisition Sponsor I, LLC and certain other securities holders named therein (incorporated by reference to Exhibit 10.3 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104)
filed with the SEC on December 6, 2021).
|
Exhibit Number
|
| |
|
| |
Letter Agreement regarding Initial Public Offering, dated November 30, 2021, by
and between PROOF Acquisition Sponsor I, LLC and PROOF Acquisition Corp I (incorporated by reference to Exhibit 10.4 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on December 6, 2021).
|
|
| |
Administrative Services Agreement, dated November 30, 2021, by and between
PROOF Acquisition Sponsor I, LLC and PROOF Acquisition Corp I (incorporated by reference to Exhibit 10.5 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001-41104) filed with the SEC on December 6, 2021).
|
|
| |
Form of Indemnity Agreement (incorporated by reference to Exhibit 10.4 to PROOF
Acquisition Corp I’s Registration Statement on Form S-1 (File No. 333-261015) filed with the SEC on November 12, 2021).
|
|
| |
Promissory Note, dated March 31, 2021, issued PROOF Acquisition Corp I to PROOF
Acquisition Sponsor I, LLC (incorporated by reference to Exhibit 10.6 to PROOF Acquisition Corp I’s Registration Statement on Form S-1 (File No. 333-261015) filed with the SEC on November 12, 2021).
|
|
| |
Securities Subscription Agreement, dated March 31, 2021, by and between PROOF
Acquisition Corp I and PROOF Acquisition Sponsor I, LLC (incorporated by reference to Exhibit 10.7 to PROOF Acquisition Corp I’s Registration Statement on Form S-1 (File No. 333-261015) filed with the SEC on November 12, 2021).
|
|
| |
Form of Subscription Agreement (incorporated by reference to Exhibit 10.9 to
PROOF Acquisition Corp I’s Registration Statement on Form S-1 (File No. 333-261015) filed with the SEC on November 12, 2021).
|
|
| |
Form of Lock-up Agreement
|
|
| |
Sponsor Support and Non-Redemption Agreement, dated as of August 1, 2023, by
and among PROOF Acquisition Sponsor I, LLC, PROOF Acquisition Corp I, and Volato, Inc. (incorporated by reference to Exhibit 10.1 to PROOF Acquisition Corp I’s Current Report on Form 8-K (File No. 001- 41104) filed with the SEC on
August 2, 2023)
|
|
| |
Form of Amended and Restated Registration Rights Agreement.
|
|
| |
Consent of Marcum LLP
|
|
| |
Consent of Rose, Snyder & Jacobs LLP
|
|
23.3*
|
| |
Consent of Steptoe & Johnson LLP (included in Exhibit 5.1).
|
| |
Power of Attorney (included on the Signature Page of this Registration
Statement).
|
|
| |
Consent of LSH Partners Securities LLC
|
|
| |
Calculation of Filing Fee Tables Form S-4
|
|
101.INS
|
| |
inline XBRL Instance Document
|
101.SCH
|
| |
inline XBRL Taxonomy Extension Schema Document
|
101.CAL
|
| |
inline XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
| |
inline XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
| |
inline XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
| |
inline XBRL Taxonomy Extension Presentation Linkbase Document
|
104**
|
| |
Cover Page Interactive Data File (embedded within the Inline XBRL document).
|
*
|
To be filed by amendment
|
**
|
Filed herewith
|
††
|
Certain portions of this exhibit have been omitted in accordance with Regulation S-K Item 601. The Registrant agrees to
furnish an unredacted copy of the exhibit to the SEC upon request.
|
(1)
|
To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration
Statement:
|
(i).
|
To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
|
(ii).
|
To reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most
recent post- effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement. Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of
prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee”
table in the effective registration statement; and
|
(iii).
|
To include any material information with respect to the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration statement;
|
(2)
|
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
(3)
|
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
at the termination of the offering.
|
(4)
|
That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed
pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and
included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a
document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use,
supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
|
(5)
|
That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the
initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to
sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer
or sell such securities to such purchaser:
|
(i).
|
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant
to Rule 424;
|
(ii).
|
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or
referred to by the undersigned registrant;
|
(iii).
|
The portion of any other free writing prospectus relating to the offering containing material information about the
undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
|
(iv).
|
other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
|
(6)
|
That, prior to any public reoffering of the securities registered hereunder through use of a prospectus which is a part of
this Registration Statement, by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c), the Registrant undertakes that such reoffering prospectus will contain the
|
(7)
|
That every prospectus: (i) that is filed pursuant to the immediately preceding paragraph, or (ii) that purports to meet the
requirements of Section 10(a)(3) of the Securities Act of 1933 and is used in connection with an offering of securities subject to Rule 415, will be filed as a part of an amendment to the registration statement and will not be used
until such amendment is effective, and that, for purposes of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
(8)
|
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrants of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
|
(9)
|
To respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11,
or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the
effective date of the registration statement through the date of responding to the request.
|
(10)
|
To supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired
involved therein, that was not the subject of and included in the registration statement when it became effective.
|
PROOF ACQUISITION CORP I
|
| |
|
||||||
|
| |
|
| |
|
| |
|
By:
|
| |
/s/ John C. Backus, Jr.
|
| |
|
|||
|
| |
Name:
|
| |
John C. Backus, Jr.
|
| |
|
|
| |
Title:
|
| |
Chief Executive Officer and Director
|
| |
|
Signature
|
| |
Title
|
| |
Date
|
|
| |
|
| |
|
/s/ John C. Backus, Jr.
|
| |
Chief Executive Officer and Director
(Principal Executive Officer)
|
| |
August 18, 2023
|
John C. Backus, Jr.
|
| |
|
|||
|
| |
|
| |
|
/s/ Steven P. Mullins
|
| |
Chief Financial Officer
(Principal Financial Officer and
Principal Accounting Officer)
|
| |
August 18, 2023
|
Steven P. Mullins
|
| |
|
|||
|
| |
|
| |
|
/s/ Peter C. Harrison
|
| |
Director
|
| |
August 18, 2023
|
Peter C. Harrison
|
| |
|
| |
|
|
| |
|
| |
|
/s/ Coleman Andrews
|
| |
Director
|
| |
August 18, 2023
|
Coleman Andrews
|
| |
|
| |
|
|
| |
|
| |
|
/s/ Mark Lerdal
|
| |
Director
|
| |
August 18, 2023
|
Mark Lerdal
|
| |
|
| |
|
|
| |
|
| |
|
/s/ Lisa Suennen
|
| |
Director
|
| |
August 18, 2023
|
Lisa Suennen
|
| |
|
| |
|