By way of background, PACQ first announced their combination with HighPeak Energy back on November 27th and as stated in their IPO prospectus, they intended to give warrant holders the option to tender their warrants at $1.00 per warrant. PACQ previously offered warrant holders the opportunity to tender at their extension vote back in October. However, at that time, Pure had 20,700,000 warrants outstanding and only 248,000 warrants opted to tender. That left 20,452,000 warrants outstanding.
As of today’s announcement, 17,293,805 Public Warrants were validly tendered in the offer, leaving 3,158,195 warrants, or 15% of their original 20,700,000 warrants.
HOWEVER, Pure’s extension runs out as of February 17th, and since they still do not have a preliminary proxy on file for a shareholder vote to complete, that means they’re probably going to have to extend again come February. That also means we’re going to have another Tender Offer for the warrants. This is because (again, per the IPO prospectus) any time Pure amends and restates its certificate of incorporation, which is what you have to do with an extension of the deadline, they can commence a tender offer. For clarity, see below from the prospectus:
“Our sponsor has also committed to offer or cause an affiliate to offer to purchase, at $1.00 per public warrant (exclusive of commissions), the outstanding public warrants in a tender offer that would commence after our filing of a proxy statement or information statement with respect to a proposed amendment to our amended and restated certificate of incorporation that would affect the substance of timing of our obligation to redeem 100% of our public shares if we do not complete a business combination within 18 months from the closing of this offering. Any such purchases would occur in connection with the effectiveness of such amendment.”
So it comes down to whether Pure can get a definitive proxy together for a completion vote in time to circulate it among shareholders ahead of it’s February 17th deadline (even though they have yet to file a preliminary proxy), or….they extend again. An extension is the more likely scenario, so as a result, they’ll get another bite at the warrant apple with a third tender offer.
Keep your eyes peeled for a new proxy from PACQ shortly….