PROXY STATEMENT
The special meeting in lieu of the 2019
annual meeting (the “special meeting”) of stockholders of Pensare Acquisition Corp. (“Pensare,” “Company,”
“we,” “us” or “our”), a Delaware corporation, will be held on January [●], 2019 at 11:00
a.m, local time, at the offices of Greenberg Traurig, LLP, located at the MetLife Building, 200 Park Avenue, New York, New York
10166 to consider and vote upon the following proposals:
|
●
|
a proposal to amend (the “Charter Amendment”)
Pensare’s amended and restated certificate of incorporation (the “charter”) to extend the date by which Pensare
has to consummate a business combination (the “Extension”) for an additional three months, from February 1, 2019 to
May 1, 2019 (the “Extended Date”);
|
|
●
|
a proposal to re-elect (the “Director Proposal”)
four directors to the Company’s board of directors (the “Board”), with each such director to serve until the
second annual meeting of stockholders following this special meeting or until his successor is elected and qualified; and
|
|
●
|
a proposal to ratify the selection by our Audit Committee
of Marcum LLP to serve as the Company’s independent registered public accounting firm for the fiscal year ending March 31,
2019 (the “Auditor Proposal”).
|
The Charter Amendment is essential to the
overall implementation of the Board’s plan to extend the date that Pensare has to complete a business combination. The purpose
of the Charter Amendment is to allow Pensare more time to complete an initial business combination. In the event that Pensare enters
into a definitive agreement for a business combination prior to the special meeting, Pensare will issue a press release and file
a Form 8-K with the Securities and Exchange Commission announcing the proposed business combination.
The affirmative vote of at least a majority
of the outstanding shares of our common stock is required to approve the Charter Amendment, a plurality of the shares of common
stock voted at the meeting is required for the re-election of each of the directors in the Director Proposal and the affirmative
vote of at least a majority of the shares of common stock voted at the meeting is required to approve the Auditor Proposal.
Holders (“public stockholders”)
of shares of Pensare’s common stock (“public shares”) sold in Pensare’s initial public offering (“IPO”)
may elect to redeem their shares for their
pro rata
portion of the funds available in the trust account in connection with
the Charter Amendment (the “Election”) regardless of whether such public stockholders vote “FOR” or “AGAINST”
the Charter Amendment and an Election can also be made by public stockholders who do not vote, or do not instruct their broker
or bank how to vote, at the special meeting. Public stockholders may make an Election regardless of whether such public stockholders
were holders as of the record date. However, the Company will not proceed with the Charter Amendment if the redemption of public
shares in connection therewith would cause the Company to have net tangible assets of less than $5,000,001. In addition, regardless
of whether public stockholders vote “FOR” or “AGAINST” the Charter Amendment, or do not vote, or do not
instruct their broker or bank how to vote, at the special meeting, if the Charter Amendment is approved by the requisite vote of
stockholders (and not abandoned), the remaining public stockholders will retain their right to redeem their public shares for their
pro rata
portion of the funds available in the trust account upon consummation of the business combination when it is submitted
to the stockholders.
The withdrawal of funds from the trust account
in connection with the Election will reduce the amount held in the trust account following the redemption, and the amount remaining
in the trust account may be significantly reduced from the approximately $314.1 million that was in the trust account as of September
30, 2018. In such event, Pensare may need to obtain additional funds to complete a business combination and there can be no assurance
that such funds will be available on terms acceptable to the parties or at all.
If the Charter Amendment is not approved
and we do not consummate a business combination by February 1, 2019, as contemplated by our IPO prospectus and in accordance with
our charter, or if the Charter Amendment is not approved and we do not consummate a business combination by February 1, 2019, we
will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten
business days thereafter, redeem 100% of the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate
amount then on deposit in the trust account, including any interest earned on the funds held in the trust account not previously
released to us, divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’
rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and
(iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and the
Board, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for
claims of creditors and the requirements of other applicable law.
Prior to the IPO, Pensare’s initial
stockholders waived their rights to participate in any liquidation distribution with respect to their shares of common stock, par
value $0.0001 per share, which were acquired by them prior to the IPO (the “founder shares”). As a consequence of such
waivers, a liquidating distribution will be made only with respect to the public shares. There will be no distribution from the
trust account with respect to Pensare’s rights and warrants, which will expire worthless in the event we wind up.
To protect amounts held in the trust account,
our sponsor has agreed that it will be liable to ensure that the proceeds in the trust account are not reduced below $10.00 per
share by the claims of target businesses or claims of vendors or other entities that are owed money by us for services rendered
or contracted for or products sold to us, but we cannot assure you that it will be able to satisfy its indemnification obligations
if it is required to do so. Additionally, the agreement entered into by our sponsor specifically provides for two exceptions to
the indemnity it has given: it will have no liability (1) as to any claimed amounts owed to a target business or vendor or other
entity who has executed an agreement with us waiving any right, title, interest or claim of any kind they may have in or to any
monies held in the trust account, or (2) as to any claims for indemnification by the underwriters of this offering against certain
liabilities, including liabilities under the Securities Act. We have not independently verified whether our sponsor has sufficient
funds to satisfy its indemnity obligations and believe that our sponsor’s only assets are securities of our company. We have
not asked our sponsor to reserve for such indemnification obligations. As a result, if we liquidate, the per-share distribution
from the trust account could be less than $10.00 due to claims or potential claims of creditors. We will distribute to all of our
public stockholders, in proportion to their respective equity interests, an aggregate amount then on deposit in the trust account,
including any interest earned on the funds held in the trust account net of interest that may be used by us to pay our franchise
and income taxes payable.
Under the Delaware General Corporation Law
(the “DGCL”), stockholders may be held liable for claims by third parties against a corporation to the extent of distributions
received by them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders upon the redemption
of 100% of our outstanding public shares in the event we do not complete our initial business combination within the required time
period may be considered a liquidation distribution under Delaware law. If the corporation complies with certain procedures set
forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including
a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which
the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are
made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such
stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder
would be barred after the third anniversary of the dissolution.
However, because we will not be complying
with Section 280 of the DGCL, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that
will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the
subsequent ten years. However, because we are a blank check company, rather than an operating company, and our operations will
be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors
(such as lawyers, investment bankers, etc.) or prospective target businesses.
Approval of the Charter Amendment proposal
will constitute consent for Pensare to instruct the trustee to (i) remove from the trust account an amount (the “Withdrawal
Amount”) equal to the
pro rata
portion of funds available in the trust account relating to the redeemed public shares
and (ii) deliver to the holders of such redeemed public shares their
pro rata
portion of the Withdrawal Amount. The remainder
of such funds shall remain in the trust account and be available for use by Pensare to complete a business combination on or before
the Extended Date. Holders of public shares who do not redeem their public shares now, will retain their redemption rights and
their ability to vote on a business combination through the Extended Date if the Charter Amendment is approved.
The record date for the special meeting
is December [●], 2018. Record holders of Pensare common stock at the close of business on the record date are entitled to
vote or have their votes cast at the special meeting. On the record date, there were 38,812,500 outstanding shares of Pensare common
stock. Pensare’s warrants do not have voting rights.
This proxy statement contains important
information about the special meeting and the proposals. Please read it carefully and vote your shares.
This proxy statement is dated January [●],
2019 and is first being mailed to stockholders on or about that date.
TABLE OF
CONTENTS
QUESTIONS
AND ANSWERS ABOUT THE SPECIAL MEETING
These Questions and Answers are only summaries
of the matters they discuss. They do not contain all of the information that may be important to you. You should read carefully
the entire document, including the annexes to this proxy statement.
Q. Why am I receiving this proxy statement?
|
A. This proxy statement
and the accompanying materials are being sent to you in connection with the solicitation of proxies by the Board, for use at the
special meeting in lieu of the 2019 annual meeting of stockholders to be held on [●], January [●], 2019 at 11:00 a.m.,
local time, at the offices of Greenberg Traurig, LLP, located at the MetLife Building, 200 Park Avenue, New York, New York
10166, or at any adjournments or postponements thereof. This proxy statement summarizes the information that you need to make an
informed decision on the proposals to be considered at the special meeting.
Pensare is a blank check company formed for the purpose of entering
into a merger, stock exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination
with one or more businesses or entities. In August 2017, Pensare consummated its IPO from which it derived gross proceeds of $310.5
million, including proceeds from the exercise of the underwriters’ over-allotment option. Like most blank check companies,
our charter provides for the return of the IPO proceeds held in trust to the holders of shares of common stock sold in the IPO
if no qualifying business combinations are consummated on or before a certain date (in our case, February 1, 2019). The Board believes
that it is in the best interests of the stockholders to continue Pensare’s existence until the Extended Date in order to
allow Pensare more time to complete such business combination and is submitting this proposal to the stockholders to vote upon.
In addition, we are proposing the re-election of four directors to the Board and the ratification of the selection by our Audit
Committee of Marcum LLP (‘‘Marcum”) to serve as the Company’s independent registered public accounting
firm for the fiscal year ending March 31, 2019.
|
Q. What is included in these materials?
|
These materials include:
●
This
proxy statement for the special meeting;
●
The
Company’s Annual Report on Form 10-K for the year ended March 31, 2018, as filed with the Securities and Exchange Commission
(the “SEC”) on June 28, 2018.
|
Q. What is being voted on?
|
A. You are being asked
to vote on:
●
a
proposal to amend Pensare’s charter to extend the date by which Pensare has to consummate a business combination to the
Extended Date; and
●
a
proposal to re-elect four directors to the Board, with each such director to serve until the second annual meeting of stockholders
following this special meeting or until his successor is elected and qualified; and
●
a
proposal to ratify the selection by our Audit Committee of Marcum LLP to serve as the Company’s independent registered public
accounting firm for the fiscal year ending March 31, 2019.
|
|
The Charter Amendment proposal is essential to the overall implementation
of the Board’s plan to extend the date that Pensare has to complete a business combination. In the event that Pensare enters
into a definitive agreement for a business combination prior to the special meeting, Pensare will issue a press release and file
a Form 8-K with the Securities and Exchange Commission announcing the proposed business combination. Approval of the Charter Amendment
is a condition to the implementation of the Extension.
If the Extension is implemented, the stockholders’ approval
of the Charter Amendment proposal will constitute consent for Pensare to remove the Withdrawal Amount from the trust account, deliver
to the holders of such redeemed public shares their
pro rata
portion of the Withdrawal Amount and retain the remainder of
the funds in the trust account for Pensare’s use in connection with consummating a business combination on or before the
Extended Date.
We will not proceed if we do not have at least $5,000,001 of
net tangible assets following approval of the Charter Amendment proposal, after taking into account the Election.
If the Charter Amendment proposal is approved and the Extension
is implemented, the removal of the Withdrawal Amount from the trust account in connection with the Election will reduce the amount
held in the trust account following the Election. Pensare cannot predict the amount that will remain in the trust account if the
Charter Amendment proposal is approved; and the amount remaining in the trust account may be significantly reduced from the approximately
$314.1 million that was in the trust account as of September 30, 2018. In such event, Pensare may need to obtain additional funds
to complete a business combination and there can be no assurance that such funds will be available on terms acceptable to the parties
or at all.
If the Charter Amendment proposal is not approved and we have
not consummated a business combination by February 1, 2019, or if the Charter Amendment proposal is approved and we have not consummated
a business combination by the Extended Date, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly
as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding public shares, at a per-share
price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including any interest earned on the
funds held in the trust account not previously released to us, divided by the number of then outstanding public shares, which redemption
will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidation
distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject
to the approval of our remaining stockholders and the Board, dissolve and liquidate, subject (in the case of (ii) and (iii) above)
to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.
Pensare’s initial stockholders have waived their
rights to participate in any liquidation distribution with respect to their founder shares. There will be no distribution from
the trust account with respect to our rights and warrants, which will expire worthless in the event we wind up. Pensare will pay
the costs of liquidation from its remaining assets held outside of the trust account.
|
Q. Why is the Company proposing the Charter Amendment proposal?
|
A. Pensare’s
charter provides for the return of the IPO proceeds held in trust to the holders of shares of common stock sold in the IPO if no
qualifying business combinations are consummated on or before February 1, 2019. Accordingly, the trust agreement provides for the
trustee to liquidate the trust account and distribute to each public stockholder its
pro rata
share of such funds if a qualifying
business combination is not consummated on or before such date provided in Pensare’s charter. As we explain below, Pensare
may not be able to complete a business combination by that date.
While Pensare is currently in discussions with respect to several
business combination opportunities, Pensare has not yet executed a definitive agreement for a business combination. Pensare currently
anticipates entering into such an agreement with one of its prospective targets, but Pensare does not expect to be able to consummate
such a business combination by February 1, 2019.
Because Pensare will not be able to conclude a business combination
within the permitted time period, Pensare has determined to seek stockholder approval to extend the date by which Pensare has to
complete a business combination.
Pensare believes that given Pensare’s expenditure of time,
effort and money on finding a business combination, circumstances warrant providing public stockholders an opportunity to consider
a business combination. Accordingly, the Board is proposing the Charter Amendment to extend Pensare’s corporate existence.
You are not being asked to vote on a business combination
at this time. If the Extension is implemented and you do not elect to redeem your public shares, you will retain the right to vote
on any proposed business combination when it is submitted to stockholders and the right to redeem your public shares for a
pro
rata
portion of the trust account in the event such business combination is approved and completed or the Company has not consummated
a business combination by the Extended Date.
|
Q. Why should I vote for the Charter Amendment?
|
A. The Board believes
stockholders should have an opportunity to evaluate an initial business combination with one or more of the targets with which
Pensare is in discussions. Accordingly, the Board is proposing the Charter Amendment to extend the date by which Pensare has to
complete a business combination until the Extended Date and to allow for the Election.
The affirmative vote of the holders of at least a majority
of all then outstanding shares of common stock is required to effect an amendment to Pensare’s Charter, including any amendment
that would extend its corporate existence beyond February 1, 2019. Additionally, Pensare’s charter requires that all public
stockholders have an opportunity to redeem their public shares in the case Pensare’s corporate existence is extended. We
believe that this charter provision was included to protect Pensare stockholders from having to sustain their investments for
an unreasonably long period if Pensare failed to find a suitable business combination in the timeframe contemplated by the charter.
We also believe, however, that given Pensare’s expenditure of time, effort and money on the potential business combinations
with the targets it has identified, circumstances warrant providing those who would like to consider whether a potential business
combination with one or more of such targets is an attractive investment with an opportunity to consider such transaction, inasmuch
as Pensare is also affording stockholders who wish to redeem their public shares the opportunity to do so, as required under its
charter. Accordingly, we believe the Extension is consistent with Pensare’s charter and IPO prospectus.
|
Q. How does the Board recommend that I vote on the Director Proposal and the Auditor Proposal?
|
A. The Board recommends that you vote in favor of the Director Proposal, to re-elect each of Dr. Klaas Baks and Messrs. U. Bertram Ellis, Jr., Karl Krapek and Dennis Lockhart to the Board and in favor of the Auditor Proposal, to ratify the selection by our Audit Committee of Marcum LLP to serve as the Company’s independent registered public accounting firm for the fiscal year ending March 31, 2019.
|
Q. How do the Pensare insiders intend to vote their shares?
|
A. All of Pensare’s
directors, executive officers and their respective affiliates are expected to vote any common stock over which they have voting
control (including any public shares owned by them) in favor of the Charter Amendment proposal, Director Proposal and Auditor Proposal.
Pensare’s directors, executive officers and their respective
affiliates are not entitled to redeem their founder shares. With respect to shares purchased on the open market by Pensare’s
directors, executive officers and their respective affiliates, such public shares may be redeemed. On the record date, Pensare’s
directors, executive officers and their affiliates beneficially owned and were entitled to vote 5,953,500 founder shares, representing
approximately 15.3% of Pensare’s issued and outstanding common stock. Pensare’s directors, executive officers and their
affiliates did not beneficially own any public shares as of such date.
Pensare’s directors, executive officers and their affiliates
may choose to buy public shares in the open market and/or through negotiated private purchases. In the event that purchases do
occur, the purchasers may seek to purchase shares from stockholders who would otherwise have voted against the Charter Amendment
proposal. Any public shares held by affiliates of Pensare may be voted in favor of the Charter Amendment proposal.
|
Q. What vote is required to adopt the Charter Amendment?
|
A. Approval of the Charter Amendment will require the affirmative vote of holders of at least a majority of Pensare’s outstanding common stock on the record date.
|
Q. What vote is required to approve the Director Proposal and the Auditor Proposal?
|
A. A plurality of the shares of common stock present (in person or by proxy) at the special meeting and voting is required for the re-election of each of the directors in the Director Proposal. The affirmative vote of at least a majority of the shares of common stock present (in person or by proxy) at the special meeting and voting on the Auditor Proposal is required to approve such proposal.
|
Q. What if I don’t want to vote for the Charter Amendment proposal?
|
A. If you do not want the Charter Amendment to be approved, you must abstain, not vote, or vote against the proposal. If the Charter Amendment is approved, and the Extension is implemented, the Withdrawal Amount will be withdrawn from the trust account and paid to the redeeming public stockholders.
|
Q. Will you seek any further extensions to liquidate the trust account?
|
A. Other than the extension until the Extended Date as described in this proxy statement, Pensare does not currently anticipate seeking any further extension to consummate a business combination. Pensare has provided that all holders of public shares, including those who vote for the Charter Amendment, may elect to redeem their public shares into their
pro rata
portion of the trust account and should receive the funds shortly after the stockholder meeting which is scheduled for January [●], 2019. Those holders of public shares who elect not to redeem their shares now shall retain redemption rights with respect to future business combinations, or, if Pensare does not consummate a business combination by the Extended Date, such holders shall be entitled to their
pro rata
portion of the trust account on such date.
|
Q. What happens if the Charter Amendment is not approved?
|
A. If the Charter Amendment
is not approved and we have not consummated a business combination by February 1, 2019, we will (i) cease all operations except
for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100%
of the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust
account, including any interest earned on the funds held in the trust account not previously released to us, divided by the number
of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders
(including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as
reasonably possible following such redemption, subject to the approval of our remaining stockholders and the Board, dissolve and
liquidate, subject (in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for claims of creditors
and the requirements of other applicable law.
Pensare’s initial stockholders waived their rights to
participate in any liquidation distribution with respect to their founder shares. There will be no distribution from the trust
account with respect to our rights and warrants which will expire worthless in the event we wind up. Pensare will pay the costs
of liquidation from its remaining assets held outside of the trust account, which it believes are sufficient for such purposes.
|
Q. If the Charter Amendment proposal is approved, what happens next?
|
A. Pensare will continue
its efforts to execute a definitive agreement for a business combination with one or more targets.
If Pensare executes such an agreement, we will seek to complete
the business combination, which will involve:
● completing proxy
materials;
● establishing a
meeting date and record date for considering a proposed business combination and distributing proxy materials to stockholders;
and
● holding a special
meeting to consider such proposed business combination.
Pensare is seeking approval of the Charter Amendment
because Pensare will not be able to complete all of the above listed tasks prior to February 1, 2019.
|
|
Upon approval by holders of at least a majority of the common
stock outstanding as of the record date of the Charter proposal, Pensare will file an amendment to the charter with the Secretary
of State of the State of Delaware in the form of
Annex A
hereto. Pensare will remain a reporting company under the Securities
Exchange Act of 1934 and its units, common stock, rights and warrants will remain publicly traded.
If the Charter Amendment proposal is approved, the removal of
the Withdrawal Amount from the trust account will reduce the amount remaining in the trust account and increase the percentage
interest of Pensare’s common stock held by Pensare’s directors and officers through the founder shares.
If the Charter Amendment proposal is approved, but Pensare does
not consummate a business combination by the Extended Date, we will (i) cease all operations except for the purpose of winding
up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding public
shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including any
interest earned on the funds held in the trust account not previously released to us, divided by the number of then outstanding
public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right
to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible
following such redemption, subject to the approval of our remaining stockholders and the Board, dissolve and liquidate, subject
(in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for claims of creditors and the requirements
of other applicable law.
Pensare’s initial stockholders waived their rights to
participate in any liquidation distribution with respect to their founder shares. There will be no distribution from the trust
account with respect to our rights and warrants which will expire worthless in the event we wind up. Pensare will pay the costs
of liquidation from its remaining assets held outside of the trust account, which it believes are sufficient for such purposes.
|
Q. Would I still be able to exercise my redemption rights if I vote against the proposed business combination?
|
A. Unless you elect to redeem all of your shares, you will be able to vote on any proposed business combination when it is submitted to stockholders. If you disagree with the business combination, you will retain your right to redeem your public shares upon consummation of a business combination in connection with the stockholder vote to approve the business combination, subject to any limitations set forth in Pensare’s charter.
|
Q. How do I change my vote?
|
A. If you have submitted a proxy to vote your shares and wish to change your vote, you may do so by delivering a later-dated, signed proxy card to Morrow Sodali LLC, Pensare’s proxy solicitor, prior to the date of the special meeting or by voting in person at the special meeting. Attendance at the special meeting alone will not change your vote. You also may revoke your proxy by sending a notice of revocation to: Morrow Sodali LLC, 470 West Avenue, Stamford, CT 06902.
|
Q. How are votes counted?
|
A. Votes will be counted
by the inspector of election appointed for the meeting, who will separately count “FOR” and “AGAINST” votes,
abstentions and broker non-votes. The Charter Amendment proposal must be approved by the affirmative vote of at least a majority
of the outstanding shares as of the record date of Pensare’s common stock. Each of the nominees named in the Director Proposal
must receive a plurality of the shares present (in person or by proxy) at the special meeting and voting for each nominee. The
Auditor Proposal must be approved by the affirmative vote of at least a majority of the shares of common stock present (in person
or by proxy) at the special meeting and voting on such proposal.
With respect to the Charter Amendment proposal, abstentions
and broker non-votes will have the same effect as “AGAINST” votes. If your shares are held by your broker as your nominee
(that is, in “street name”), you may need to obtain a proxy form from the institution that holds your shares and follow
the instructions included on that form regarding how to instruct your broker to vote your shares. If you do not give instructions
to your broker, your broker can vote your shares with respect to “discretionary” items, but not with respect to “non-discretionary”
items. Discretionary items are proposals considered routine under the rules of the New York Stock Exchange applicable to member
brokerage firms. These rules provide that for routine matters your broker has the discretion to vote shares held in street name
in the absence of your voting instructions. On non-discretionary items for which you do not give your broker instructions, the
shares will be treated as broker non-votes.
|
Q. If my shares are held in “street name,” will my broker automatically vote them for me?
|
A. With respect to the Charter Amendment proposal and the Director Proposal, your broker can vote your shares only if you provide them with instructions on how to vote. You should instruct your broker to vote your shares. Your broker can tell you how to provide these instructions. Your broker may automatically vote your shares with respect to the Auditor Proposal.
|
Q. What is a quorum requirement?
|
A. A quorum of stockholders
is necessary to hold a valid meeting. A quorum will be present with regard to each of the Charter Amendment proposal, Director
Proposal and Auditor Proposal if at least a majority of the outstanding shares of common stock on the record date are represented
by stockholders present at the meeting or by proxy.
Your shares will be counted towards the quorum only if you submit
a valid proxy (or one is submitted on your behalf by your broker, bank or other nominee) or if you vote in person at the special
meeting. Abstentions and broker non-votes will be counted towards the quorum requirement. If there is no quorum, the chairman of
the special meeting may adjourn the special meeting to another date.
|
Q. Who can vote at the special meeting?
|
A. Only holders of
record of Pensare’s common stock at the close of business on December [●], 2018, the record date, are entitled to have
their vote counted at the special meeting and any adjournments or postponements thereof. On the record date, 38,812,500 shares
of common stock, including 31,050,000 shares of Class A common stock, were outstanding and entitled to vote.
Stockholder of Record: Shares Registered in Your
Name
. If on the record date your shares were registered directly in your name with Pensare’s transfer agent, Continental
Stock Transfer & Trust Company, then you are a stockholder of record. As a stockholder of record, you may vote in person at
the special meeting or vote by proxy. Whether or not you plan to attend the special meeting in person, we urge you to fill out
and return the enclosed proxy card to ensure your vote is counted.
|
|
Beneficial Owner: Shares Registered in the Name of a Broker
or Bank
. If on the record date your shares were held, not in your name, but rather in an account at a brokerage firm, bank,
dealer, or other similar organization, then you are the beneficial owner of shares held in “street name” and these
proxy materials are being forwarded to you by that organization. As a beneficial owner, you have the right to direct your broker
or other agent on how to vote the shares in your account. You are also invited to attend the special meeting. However, since you
are not the stockholder of record, you may not vote your shares in person at the special meeting unless you request and obtain
a valid proxy from your broker or other agent.
|
|
|
Q. How does the Board recommend I vote?
|
A. After careful consideration of the terms and conditions of these proposals, the Board has determined that the Charter Amendment is fair to and in the best interests of Pensare and its stockholders. The Board recommends that Pensare’s stockholders vote “FOR” the Charter Amendment. In addition, the Board recommends that you vote “FOR” the Director Proposal and Auditor Proposal.
|
Q. What interests do the Company’s directors and officers have in the approval of the proposals?
|
A. Pensare’s directors and officers have interests in the proposals that may be different from, or in addition to, your interests as a sockholder. These interests include ownership of founder shares and warrants that may become exercisable in the future, committed loans by them, that if drawn upon, will not be repaid in the event of our winding up and the possibility of future compensatory arrangements. See the section entitled “
The Charter Amendment Proposal—Interests of Pensare’s Directors and Officers
.”
|
Q. What if I object to the Charter Amendment? Do I have appraisal rights?
|
A. If you do not want the Charter to be approved, you must vote against the proposal, abstain from voting or refrain from voting. If holders of public shares do not elect to redeem their public shares, such holders shall retain redemption rights in connection with any future business combination Pensare proposes. You will still be entitled to make the Election if you vote against, abstain or do not vote on the Charter Amendment. In addition, public stockholders who do not make the Election would be entitled to redemption if the Company has not completed a business combination by the Extended Date. Pensare stockholders do not have appraisal rights in connection with the Charter Amendment under the DGCL.
|
Q. What happens to the Pensare rights and warrants if the Charter Amendment is not approved?
|
A. If the Charter Amendment is not approved and we have not consummated a business combination by February 1, 2019, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including any interest earned on the funds held in the trust account not previously released to us, divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and the Board, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no distribution from the trust account with respect to our rights and warrants which will expire worthless in the event we wind up.
|
Q. What happens to the Pensare rights and warrants if the Charter Amendment is approved?
|
A. If the Charter Amendment proposal is approved, Pensare will continue to attempt to execute a definitive agreement for a business combination, and if successful, will attempt to complete such business combination by the Extended Date, and will retain the blank check company restrictions previously applicable to it. The rights will entitle their holder to receive one-tenth (1/10) of one share of common stock upon consummation of an initial business combination. The warrants will remain outstanding in accordance with their terms and will become exercisable 30 days after the completion of a business combination. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of the initial business combination or earlier upon redemption or liquidation.
|
Q. What do I need to do now?
|
A. Pensare urges you to read carefully and consider the information contained in this proxy statement, including the annex, and to consider how the proposals will affect you as a Pensare stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement and on the enclosed proxy card.
|
Q. How do I vote?
|
A. If you are a holder
of record of Pensare common stock, you may vote in person at the special meeting or by submitting a proxy for the special meeting.
Whether or not you plan to attend the special meeting in person, we urge you to vote by proxy to ensure your vote is counted. You
may submit your proxy by completing, signing, dating and returning the enclosed proxy card in the accompanying pre-addressed postage
paid envelope. You may still attend the special meeting and vote in person if you have already voted by proxy.
If your shares of Pensare common stock are held in “street
name” by a broker or other agent, you have the right to direct your broker or other agent on how to vote the shares in your
account. You are also invited to attend the special meeting. However, since you are not the stockholder of record, you may not
vote your shares in person at the special meeting unless you request and obtain a valid proxy from your broker or other agent.
|
Q. How do I redeem my shares of Pensare common stock?
|
A. If the Extension
is implemented, each public stockholder may seek to redeem such stockholder’s public shares for its
pro rata
portion
of the funds available in the trust account, less any income taxes owed on such funds but not yet paid. You will also be able to
redeem your public shares in connection with any stockholder vote to approve a proposed business combination, or if the Company
has not consummated a business combination by the Extended Date.
In connection with tendering your shares for redemption, you
must elect either to physically tender your share certificates to Continental Stock Transfer & Trust Company, the Company’s
transfer agent, at Continental Stock Transfer & Trust Company, One State Street, 30th Floor, New York, New York 10004-1561,
Attn: Mark Zimkind, mzimkind@continentalstock.com, at least two business days prior to the special meeting or to deliver your shares
to the transfer agent electronically using The Depository Trust Company’s DWAC (Deposit/Withdrawal At Custodian) System,
which election would likely be determined based on the manner in which you hold your shares.
Certificates that have not been tendered in accordance
with these procedures at least two business days prior to the special meeting will not be redeemed for cash. In the event that
a public shareholder tenders its shares and decides prior to the special meeting that it does not want to redeem its shares, the
shareholder may withdraw the tender. If you delivered your shares for redemption to our transfer agent and decide prior to the
special meeting not to redeem your shares, you may request that our transfer agent return the shares (physically or electronically).
You may make such request by contacting our transfer agent at the address listed above.
|
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 and multiple proxy cards or voting instruction cards, if your shares are registered in more than one name or are registered in different accounts. 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. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast a vote with respect to all of your Pensare shares.
|
Q. Who is paying for this proxy solicitation?
|
A. Pensare will pay for the entire cost of soliciting proxies. In addition to these mailed proxy materials, our directors and officers may also solicit proxies in person, by telephone or by other means of communication. These parties will not be paid any additional compensation for soliciting proxies. We may also reimburse brokerage firms, banks and other agents for the cost of forwarding proxy materials to beneficial owners.
|
Q. Who can help answer my questions?
|
A. If you have questions,
you may write or call Pensare’s proxy solicitor:
Morrow Sodali LLC
470 West Avenue
Stamford, CT 06902
Telephone: (800) 662-5200
Banks and brokers: (203) 658-9400
Email: WRLS.info@morrowsodali.com
You may also obtain additional information about the
Company from documents filed with the SEC by following the instructions in the section entitled “
Where You Can Find More
Information
.”
|
FORWARD-LOOKING
STATEMENTS
This proxy statement and the documents to
which we refer you in this proxy statement contain “forward-looking statements” as that term is defined by the Private
Securities Litigation Reform Act of 1995, which we refer to as the Act, and the federal securities laws. Any statements that do
not relate to historical or current facts or matters are forward-looking statements. You can identify some of the forward-looking
statements by the use of forward-looking words such as “anticipate,” “believe,” “plan,” “estimate,”
“expect,” “intend,” “should,” “may” and other similar expressions, although not
all forward-looking statements contain these identifying words. There can be no assurance that actual results will not materially
differ from expectations. Such statements include, but are not limited to, any statements relating to our ability to consummate
a business combination, and any other statements that are not statements of current or historical facts. These forward-looking
statements are based on information available to the Company as of the date of the proxy materials and current expectations, forecasts
and assumptions and involve a number of risks and uncertainties. Accordingly, forward-looking statements should not be relied upon
as representing the Company’s views as of any subsequent date and the Company undertakes no obligation to update forward-looking
statements to reflect events or circumstances after the date they were made.
These forward-looking statements involve
a number of known and unknown risks and uncertainties or other assumptions that may cause actual results or performance to be materially
different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to
differ include:
|
●
|
the ability of the Company to effect the Charter Amendment or consummate a business combination;
|
|
●
|
unanticipated delays in the distribution of the funds from the trust account;
|
|
●
|
claims by third parties against the trust account; or
|
|
●
|
the ability of the Company to finance and consummate a business combination.
|
You should carefully consider these risks,
in addition to the risk factors set forth in our other filings with the SEC, including the final prospectus related to our IPO
dated July 27, 2017 (Registration Nos. 333-219162 and 333-219518) and our Annual Report on Form 10-K for the fiscal year ended
March 31, 2018. The documents we file with the SEC, including those referred to above, also discuss some of the risks that could
cause actual results to differ from those contained or implied in the forward-looking statements. See “
Where You Can Find
More Information
” for additional information about our filings.
BACKGROUND
Pensare
We are a Delaware company incorporated on
April 7, 2016 for the purpose of entering into a merger, stock exchange, asset acquisition, stock purchase, recapitalization, reorganization
or other similar business combination with one or more businesses or entities.
On August 1, 2017, we consummated our IPO
of 27,000,000 units, with each unit consisting of one share of common stock, one right and one-half of one warrant. Each right
entitles the holder thereof to receive one-tenth (1/10) of one share of common stock upon the consummation of an initial business
combination, as described in more detail in the IPO prospectus. Each whole warrant entitles the holder to purchase one share of
common stock at a price of $11.50. On August 4, 2017, the underwriters exercised their over-allotment option in full to purchase
an additional 4,050,000 units. The units were sold at an offering price of $10.00 per unit, generating gross proceeds of $310,500,000.
The units began trading on July 28, 2017
on the NASDAQ Stock Market under the symbol “WRLSU.” Commencing on August 8, 2014, the securities comprising the units
began separate trading. The units, common stock, rights and warrants are trading on the NASDAQ Stock Market under the symbols “WRLSU,”
“WRLS,” “WRLSR” and “WRLSW,” respectively.
Prior to our IPO, our sponsor and certain
other persons purchased an aggregate of 7,187,500 shares of our common stock for an aggregate purchase price of $25,000 in cash,
or approximately $0.0035 per share. In June 2017, our sponsor transferred 1,575,000 founder shares to MasTec, Inc. (“MasTec”)
for the same purchase price originally paid for such shares. In July 2017, we effected a stock dividend with respect to our common
stock of 575,000 shares thereof, resulting in our initial stockholders holding an aggregate of 7,762,500 founder shares. Simultaneously
with the consummation of the IPO and the over-allotment, our sponsor, MasTec and EarlyBirdCapital, Inc. (“EBC”) purchased
an aggregate of 10,512,500 warrants (the “private placement warrants”) for $10,512,500. The net proceeds of the IPO
plus the proceeds of the sale of the private placement warrants were deposited in the trust account. As of September 30, 2018,
Pensare had approximately $314.1 million in the trust account.
The mailing address of Pensare’s principal
executive office is Pensare Acquisition Corp., 1720 Peachtree Street, Suite 629, Atlanta, GA 30309, and its telephone number is
(404) 234-3098.
The Potential Business Combination
Pensare is currently in discussions with
multiple targets to complete a business combination that would qualify as an initial business combination under its charter. In
the event that Pensare enters into a definitive agreement for a business combination prior to the special meeting, Pensare will
issue a press release and file a Form 8-K with the Securities and Exchange Commission announcing the proposed business combination.
You are not being asked to vote on a
business combination at this time. If the Extension is implemented and you do not elect to redeem your public shares, you will
retain the right to vote on any proposed business combination if and when it is submitted to stockholders and the right to redeem
your public shares for a
pro rata
portion of the trust account in the event such business combination is approved and completed
or the Company has not consummated a business combination by the Extended Date.
The Special Meeting
Date, Time and Place
. The special
meeting in lieu of the 2019 annual meeting of Pensare’s stockholders will be held on January [●], 2019 at 11:00 a.m.,
local time, at the offices of Greenberg Traurig, LLP, located at the MetLife Building, 200 Park Avenue, New York, New York 10166.
Voting Power; Record Date
. You will
be entitled to vote or direct votes to be cast at the special meeting, if you owned shares of Pensare’s common stock at the
close of business on December [●], 2018, the record date for the special meeting. You will have one vote per proposal for
each share you owned at that time. Pensare’s rights and warrants do not carry voting rights.
Votes Required
. The affirmative vote
of at least a majority of the outstanding shares of our common stock is required to approve the Charter Amendment, a plurality
of the shares of common stock voted at the meeting is required for the re-election of each of the directors in the Director Proposal
and the affirmative vote of at least a majority of the shares of common stock voted at the meeting is required to approve the Auditor
Proposal. If you do not vote (i.e., you “abstain” from voting on a proposal), your action will have the effect of a
vote against the Charter Amendment and no effect on either the Director Proposal and Auditor Proposal. Likewise, abstentions and
broker non-votes will have the effect of a vote against the Charter Amendment and no effect on either of the Director Proposal
and Auditor Proposal.
At the close of business on the record date,
there were 38,812,500 outstanding shares of common stock, including 31,050,000 public shares, each of which entitles its holder
to cast one vote per proposal.
If you do not want the Charter Amendment
approved, you should vote against the proposal or abstain from voting on the proposal. If you want to obtain your
pro rata
portion of the trust account in the event the Extension is implemented, which will be paid shortly after the special meeting scheduled
for January [●], 2019, you must demand redemption of your shares. Holders of public shares may redeem their public shares
regardless of whether they vote for or against the Charter Amendment or abstain.
Proxies; Board Solicitation
. Your
proxy is being solicited by the Board on the proposals being presented to stockholders at the special meeting to approve the Charter
Amendment, Director Proposal and Auditor Proposal. No recommendation is being made as to whether you should elect to redeem your
shares. Proxies may be solicited in person or by telephone. If you grant a proxy, you may still revoke your proxy and vote your
shares in person at the special meeting.
Pensare has retained Morrow Sodali LLC to
aid in the solicitation of proxies. Morrow Sodali LLC will receive a fee of approximately $30,000, as well as reimbursement for
certain costs and out-of-pocket expenses incurred by them in connection with their services, all of which will be paid by Pensare.
In addition, officers and directors of Pensare may solicit proxies by mail, telephone, facsimile, and personal interview, for which
no additional compensation will be paid, though they may be reimbursed for their out-of-pocket expenses. Pensare will bear the
cost of preparing, assembling and mailing the enclosed form of proxy, this proxy statement and other material which may be sent
to stockholders in connection with this solicitation. Pensare may reimburse brokerage firms and other nominee holders for their
reasonable expenses in sending proxies and proxy material to the beneficial owners of our shares.
THE
CHARTER AMENDMENT PROPOSAL
Charter Amendment Proposal
Pensare is proposing to amend its charter
to extend the date by which Pensare has to consummate a business combination from February 1, 2019 to the Extended Date.
The Charter Amendment is essential to the
overall implementation of the Board’s plan to allow Pensare more time to complete a business combination. Approval of the
Charter Amendment is a condition to the implementation of the Extension.
If the Charter Amendment proposal is not
approved and we have not consummated a business combination by February 1, 2019, we will (i) cease all operations except for the
purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the
outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account,
including any interest earned on the funds held in the trust account not previously released to us, divided by the number of then
outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including
the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably
possible following such redemption, subject to the approval of our remaining stockholders and the Board, dissolve and liquidate,
subject (in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for claims of creditors and the
requirements of other applicable law. There will be no distribution from the trust account with respect to our warrants which will
expire worthless in the event we wind up.
A copy of the proposed amendment to the
charter of Pensare is attached to this proxy statement as
Annex A
.
Reasons for the Proposal
Pensare’s IPO prospectus and charter
provide that Pensare has until February 1, 2019 to consummate a business combination. While we are currently in discussions with
respect to several business combination opportunities, the Board currently believes that there will not be sufficient time before
February 1, 2019 to complete a business combination. The affirmative vote of the holders of at least a majority of all outstanding
shares of common stock is required to extend Pensare’s corporate existence, except in connection with, and effective upon
consummation of, a business combination. Additionally, Pensare’s IPO prospectus and charter provide for all public stockholders
to have an opportunity to redeem their public shares in the case Pensare’s corporate existence is extended as described above.
Because Pensare continues to believe that a business combination would be in the best interests of Pensare’s stockholders,
and because Pensare will not be able to conclude a business combination within the permitted time period, Pensare has determined
to seek stockholder approval to extend the date by which Pensare has to complete a business combination beyond February 1, 2019
to the Extended Date.
We believe that the foregoing charter provisions
were included to protect Pensare stockholders from having to sustain their investments for an unreasonably long period, if Pensare
failed to find a suitable business combination in the timeframe contemplated by the charter. We also believe, however, that given
Pensare’s expenditure of time, effort and money on the potential business combinations with the targets it has identified,
circumstances warrant providing those who would like to consider whether such potential business combinations are attractive investments
with an opportunity to consider such transactions, inasmuch as Pensare is also affording stockholders who wish to redeem their
public shares the opportunity to do so, as required under its charter. Accordingly, the Extension is consistent with Pensare’s
charter and IPO prospectus.
If the Charter Amendment Proposal Is Not Approved
If the Charter Amendment proposal is not
approved and we have not consummated a business combination by February 1, 2019, we will (i) cease all operations except for the
purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the
outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account,
including any interest earned on the funds held in the trust account not previously released to us, divided by the number of then
outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including
the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably
possible following such redemption, subject to the approval of our remaining stockholders and the Board, dissolve and liquidate,
subject (in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for claims of creditors and the
requirements of other applicable law.
Pensare’s initial stockholders have
waived their rights to participate in any liquidation distribution with respect to their founder shares. There will be no distribution
from the trust account with respect to Pensare’s warrants which will expire worthless in the event we wind up. Pensare will
pay the costs of liquidation from its remaining assets held outside of the trust account.
If the Charter Amendment proposal is not
approved, the Company will not effect the Extension, and in the event the Company does not complete a business combination on or
before February 1, 2019, the trust account will be liquidated and distributed to the public shareholders on a
pro rata
basis
as described above.
If the Charter Amendment Proposal Is Approved
If the Charter Amendment proposal is approved,
Pensare will file an amendment to the charter with the Secretary of State of the State of Delaware in the form of
Annex A
hereto. Pensare will remain a reporting company under the Securities Exchange Act of 1934 and its units, common stock, rights and
warrants will remain publicly traded. Pensare will then continue to work to complete a business combination by the Extended Date.
If the Charter Amendment proposal is approved,
but Pensare does not consummate a business combination by the Extended Date, we will (i) cease all operations except for the purpose
of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding
public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including
any interest earned on the funds held in the trust account not previously released to us, divided by the number of then outstanding
public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right
to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible
following such redemption, subject to the approval of our remaining stockholders and the Board, dissolve and liquidate, subject
(in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for claims of creditors and the requirements
of other applicable law.
Pensare’s initial stockholders waived
their rights to participate in any liquidation distribution with respect to their founder shares. There will be no distribution
from the trust account with respect to our warrants which will expire worthless in the event we wind up. Pensare will pay the costs
of liquidation from its remaining assets held outside of the trust account, which it believes are sufficient for such purposes.
You are not being asked to vote on a
business combination at this time. If the Extension is implemented and you do not elect to redeem your public shares, you will
retain the right to vote on any proposed business combination when it is submitted to stockholders and the right to redeem your
public shares for a
pro rata
portion of the trust account in the event such business combination is approved and completed
or the Company has not consummated a business combination by the Extended Date.
If the Charter Amendment proposal is approved,
and the Extension is implemented, the removal of the Withdrawal Amount from the trust account in connection with the Election will
reduce the amount held in the trust account and Pensare’s net asset value. Pensare cannot predict the amount that will remain
in the trust account if the Charter Amendment proposal is approved; and the amount remaining in the trust account may be significantly
reduced from the approximately $314.1 million that was in the trust account as of September 30, 2018. However, we will not proceed
if we do not have at least $5,000,001 of net tangible assets following approval of the Charter Amendment proposal.
Redemption Rights
If the Charter Amendment proposal is approved,
the Company will provide the public stockholders making the Election, the opportunity to receive, at the time the Charter Amendment
becomes effective, and in exchange for the surrender of their shares, a
pro rata
portion of the funds available in the trust
account, less any income taxes owed on such funds but not yet paid. You will also be able to redeem your public shares in connection
with any stockholder vote to approve a proposed business combination, or if the Company has not consummated a business combination
by the Extended Date.
TO DEMAND REDEMPTION, PRIOR TO 5:00 P.M.
EASTERN TIME ON [●], 2019 (TWO BUSINESS DAYS BEFORE THE SPECIAL MEETING), YOU SHOULD ELECT EITHER TO PHYSICALLY TENDER YOUR
SHARE CERTIFICATES TO OUR TRANSFER AGENT OR TO DELIVER YOUR SHARES TO OUR TRANSFER AGENT ELECTRONICALLY USING DTC’S DWAC
(DEPOSIT/WITHDRAWAL AT CUSTODIAN), AS DESCRIBED HEREIN. YOU SHOULD ENSURE THAT YOUR BANK OR BROKER COMPLIES WITH THE REQUIREMENTS
IDENTIFIED ELSEWHERE HEREIN.
In connection with tendering your shares
for redemption, you must elect either to physically tender your stock certificates to Continental Stock Transfer & Trust Company,
the Company’s transfer agent, at Continental Stock Transfer & Trust Company, One State Street, 30th Floor, New York,
New York 10004-1561, Attn: Mark Zimkind, mzimkind@continentalstock.com, prior to the vote for the Charter Amendment or to deliver
your shares to the transfer agent electronically using The Depository Trust Company’s DWAC (Deposit/Withdrawal At Custodian)
System, which election would likely be determined based on the manner in which you hold your shares. The requirement for physical
or electronic delivery prior to the vote at the special meeting ensures that a redeeming holder’s election is irrevocable
once the Charter Amendment are approved. In furtherance of such irrevocable election, stockholders making the election will not
be able to tender their shares after the vote at the special meeting.
Through the DWAC system, this electronic
delivery process can be accomplished by the stockholder, whether or not it is a record holder or its shares are held in “street
name,” by contacting the transfer agent or its broker and requesting delivery of its shares through the DWAC system. Delivering
shares physically may take significantly longer. In order to obtain a physical stock certificate, a stockholder’s broker
and/or clearing broker, DTC, and the Company’s transfer agent will need to act together to facilitate this request. There
is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering
them through the DWAC system. The transfer agent will typically charge the tendering broker $45 and the broker would determine
whether or not to pass this cost on to the redeeming holder. It is the Company’s understanding that stockholders should generally
allot at least two weeks to obtain physical certificates from the transfer agent. The Company does not have any control over this
process or over the brokers or DTC, and it may take longer than two weeks to obtain a physical stock certificate. Such stockholders
will have less time to make their investment decision than those stockholders that deliver their shares through the DWAC system.
Stockholders who request physical stock certificates and wish to redeem may be unable to meet the deadline for tendering their
shares before exercising their redemption rights and thus will be unable to redeem their shares.
Certificates that have not been tendered
in accordance with these procedures prior to the vote for the Charter Amendment will not be redeemed for a
pro rata
portion
of the funds held in the trust account. In the event that a public stockholder tenders its shares and decides prior to the vote
at the special meeting that it does not want to redeem its shares, the stockholder may withdraw the tender. If you delivered your
shares for redemption to our transfer agent and decide prior to the vote at the special meeting not to redeem your shares, you
may request that our transfer agent return the shares (physically or electronically). You may make such request by contacting our
transfer agent at the address listed above. In the event that a public stockholder tenders shares and the Charter Amendment is
not approved or is abandoned, these shares will not be redeemed and the physical certificates representing these shares will be
returned to the stockholder promptly following the determination that the Charter Amendment will not be approved or will be abandoned.
The Company anticipates that a public stockholder who tenders shares for redemption in connection with the vote to approve the
Charter Amendment would receive payment of the redemption price for such shares soon after the completion of the Charter Amendment.
The transfer agent will hold the certificates of public stockholders that make the election until such shares are redeemed for
cash or returned to such stockholders.
If properly demanded, the Company will redeem
each public share for a
pro rata
portion of the funds available in the trust account, less any income taxes owed on such
funds but not yet paid, calculated as of two days prior to the filing of the amendment to the charter. As of September 30, 2018,
this would amount to approximately $10.12 per share. The closing price of Pensare’s common stock on January [●], 2019
was $[●]. Accordingly, if the market price were to remain the same until the date of the special meeting, exercising redemption
rights would result in a public stockholder receiving $[●] more for each share than if such stockholder sold the shares in
the open market.
If you exercise your redemption rights,
you will be exchanging your shares of common stock for cash and will no longer own the shares. You will be entitled to receive
cash for these shares only if you properly demand redemption and tender your stock certificate(s) to the Company’s transfer
agent at least two business days prior to the special meeting. If the Charter Amendment is not approved or if it is abandoned,
these shares will be returned promptly following the special meeting as described above.
Possible Claims Against and Impairment of the Trust Account
To protect amounts held in the trust account,
our sponsor has agreed that it will be liable to ensure that the proceeds in the trust account are not reduced below $10.00 per
share by the claims of target businesses or claims of vendors or other entities that are owed money by us for services rendered
or contracted for or products sold to us, but we cannot assure you that it will be able to satisfy its indemnification obligations
if it is required to do so. Additionally, the agreement entered into by our sponsor specifically provides for two exceptions to
the indemnity it has given: it will have no liability (1) as to any claimed amounts owed to a target business or vendor or other
entity who has executed an agreement with us waiving any right, title, interest or claim of any kind they may have in or to any
monies held in the trust account, or (2) as to any claims for indemnification by the underwriters of this offering against certain
liabilities, including liabilities under the Securities Act. We have not independently verified whether our sponsor has sufficient
funds to satisfy its indemnity obligations and believe that our sponsor’s only assets are securities of our company. We have
not asked our sponsor to reserve for such indemnification obligations. As a result, if we liquidate, the per-share distribution
from the trust account could be less than $10.00 due to claims or potential claims of creditors. We will distribute to all of our
public stockholders, in proportion to their respective equity interests, an aggregate amount then on deposit in the trust account,
including any interest earned on the funds held in the trust account net of interest that may be used by us to pay our franchise
and income taxes payable.
In the event that the proceeds in the trust
account are reduced below $10.00 per public share and our sponsor asserts that it is unable to satisfy its obligations or that
it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take
legal action against our sponsor to enforce such indemnification obligations. While we currently expect that our independent directors
would take legal action on our behalf against our sponsor to enforce such indemnification obligations to us, it is possible that
our independent directors in exercising their business judgment may choose not to do so in any particular instance. If our independent
directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution
to our public stockholders may be reduced below $10.00 per share.
Required Vote
Approval of the Charter Amendment proposal
requires the affirmative vote of holders of at least a majority of Pensare’s common stock outstanding on the record date.
If the Charter Amendment proposal is not approved and Pensare is unable to complete a business combination on or before February
1, 2019, it will be required by its charter to (i) cease all operations except for the purpose of winding up, (ii) as promptly
as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding public shares, at a per-share
price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including any interest earned on the
funds held in the trust account not previously released to us, divided by the number of then outstanding public shares, which redemption
will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidation
distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject
to the approval of our remaining stockholders and the Board, dissolve and liquidate, subject (in the case of (ii) and (iii) above)
to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.
All of Pensare’s directors, executive
officers and their affiliates are expected to vote any common stock owned by them in favor of the Charter Amendment. On the record
date, directors and executive officers of Pensare and their affiliates beneficially owned and were entitled to vote 5,953,500 shares
of common stock representing approximately 15.3% of Pensare’s issued and outstanding common stock.
In addition, Pensare’s directors,
executive officers and their affiliates may choose to buy shares of Pensare public common stock in the open market and/or through
negotiated private purchases. In the event that purchases do occur, the purchasers may seek to purchase shares from stockholders
who would otherwise have voted against the Charter Amendment proposal and elected to redeem their shares for a portion of the trust
account. Any shares of common stock held by affiliates will be voted in favor of the Charter Amendment proposal.
Interests of Pensare’s Directors and Officers
When you consider the recommendation of
the Board, you should keep in mind that Pensare’s executive officers and members of the Board have interests that may be
different from, or in addition to, your interests as a stockholder. These interests include, among other things:
|
●
|
If the Charter Amendment is not approved and we do not consummate a business combination by February 1, 2019 as contemplated
by our IPO prospectus and in accordance with our charter, the 5,953,500 shares of common stock held by Pensare officers, directors
and affiliates, which were acquired prior to the IPO for an aggregate purchase price of approximately $25,000, will be worthless
(as the holders have waived liquidation rights with respect to such shares), as will the 7,017,290 warrants that were acquired
simultaneously with the IPO and over-allotment by our sponsor for an aggregate purchase price of $7,017,290, which will expire.
Such common stock and warrants had an aggregate market value of approximately $[●] based on the last sale price of Pensare’s
common stock and warrants of $[●] and $[●], respectively, on Nasdaq on January [●], 2019;
|
|
●
|
In connection with the IPO, our sponsor agreed that it will be liable under certain circumstances to ensure that the proceeds
in the trust account are not reduced by the claims of target businesses or vendors or other entities that are owed money by the
Company for services rendered, contracted for or products sold to the Company;
|
|
●
|
All rights specified in Pensare’s charter relating to the right of officers and directors to be indemnified by Pensare,
and of Pensare’s officers and directors to be exculpated from monetary liability with respect to prior acts or omissions,
will continue after a business combination. If the business combination is not approved and Pensare liquidates, Pensare will not
be able to perform its obligations to its officers and directors under those provisions;
|
|
●
|
None of Pensare’s executive officers or directors has received any cash compensation for services rendered to Pensare.
All of the current members of Pensare’s board of directors are expected to continue to serve as directors at least through
the date of the special meeting and may continue to serve following any potential business combination and receive compensation
thereafter;
|
|
●
|
Our sponsor has loaned to Pensare $1,000,000, which was evidenced by an unsecured promissory note, which is payable without
interest upon consummation of a business combination. In the event that Pensare does not complete an initial business combination,
it may use a portion of the working capital held outside the trust account to repay such loaned amount but no proceeds from the
trust account may be used for such repayment. Accordingly, Pensare will most likely be unable to repay the loan if a business combination
is not completed;
|
|
●
|
Pensare’s officers, directors, initial stockholders and their affiliates are entitled to reimbursement of out-of-pocket
expenses incurred by them in connection with certain activities on Pensare’s behalf, such as identifying and investigating
possible business targets and business combinations. These individuals have negotiated the repayment of any such expenses upon
completion of Pensare’s initial business combination. However, if Pensare fails to obtain the Extension and consummate a
business combination, they will not have any claim against the trust account for reimbursement. Accordingly, Pensare will most
likely not be able to reimburse these expenses if the proposed business combination is not completed. Although as of the record
date, Pensare’s officers, directors, initial stockholders and their affiliates had not incurred any unpaid reimbursable expenses,
they may incur such expenses in the future; and
|
|
●
|
Pensare has entered into an Administrative Services Agreement with our sponsor, pursuant to which, Pensare pays $20,000 per
month for office space, utilities and secretarial support. Upon the earlier of completion of a business combination or liquidation,
Pensare will cease paying these monthly fees. Accordingly, our sponsor may receive payments in excess of the 18 payments originally
contemplated, if the Charter Amendment is implemented.
|
The Board’s Reasons for the Charter Amendment Proposal
and Its Recommendation
As discussed below, after careful consideration
of all relevant factors, the Board has determined that the Charter Amendment proposal is fair to, and in the best interests of,
Pensare and its stockholders. The Board has approved and declared advisable adoption of the Charter Amendment proposal, and recommends
that you vote “FOR” such adoption. The Board expresses no opinion as to whether you should redeem your public shares.
We are a Delaware company incorporated on
April 7, 2016 for the purpose of entering into a merger, stock exchange, asset acquisition, stock purchase, recapitalization, reorganization
or other similar business combination with one or more businesses or entities. On August 1, 2017, we consummated our IPO of 27,000,000
units, with each unit consisting of one share of common stock, one right and one-half of one warrant. Each right entitles the holder
thereof to receive one-tenth (1/10) of one share of common stock upon the consummation of an initial business combination, as described
in more detail in the IPO prospectus. Each whole warrant entitles the holder to purchase one share of common stock at a price of
$11.50. On August 4, 2017, the underwriters exercised their over-allotment option in full to purchase an additional 4,050,000 units.
The units were sold at an offering price of $10.00 per unit, generating gross proceeds of $310,500,000.
Pensare’s IPO prospectus and charter
provide that Pensare has until February 1, 2019 to consummate a business combination. While we are currently in discussions with
respect to several business combination opportunities, our board currently believes that there will not be sufficient time before
February 1, 2019 to complete a business combination. The affirmative vote of the holders of at least a majority of all outstanding
shares of common stock is required to extend Pensare’s corporate existence, except in connection with, and effective upon
consummation of, a business combination. Additionally, Pensare’s IPO prospectus and charter provide for all public stockholders
to have an opportunity to redeem their public shares in the case Pensare’s corporate existence is extended as described above.
Because Pensare continues to believe that a business combination would be in the best interests of Pensare’s stockholders,
and because Pensare will not be able to conclude a business combination within the permitted time period, Pensare has determined
to seek stockholder approval to extend the date by which Pensare has to complete a business combination beyond February 1, 2019
to the Extended Date.
Pensare is not asking you to vote on a business
combination at this time. If the Extension is implemented and you do not elect to redeem your public shares, you will retain the
right to vote on any proposed business combination when it is submitted to stockholders and the right to redeem your public shares
for a
pro rata
portion of the trust account in the event such business combination is approved and completed or the Company
has not consummated a business combination by the Extended Date.
The affirmative vote of the holders of at
least a majority of all then outstanding shares of common stock is required to effect an amendment to Pensare’s charter that
would extend its corporate existence beyond February 1, 2019, except in connection with, and effective upon consummation of, a
business combination. Additionally, Pensare’s charter requires that all public stockholders have an opportunity to redeem
their public shares in the case Pensare’s corporate existence is extended as described above. We believe that these charter
provisions were included to protect Pensare stockholders from having to sustain their investments for an unreasonably long period,
if Pensare failed to find a suitable business combination in the timeframe contemplated by the charter. We also believe, however,
that given Pensare’s expenditure of time, effort and money on the potential business combinations with the targets it has
identified, circumstances warrant providing those who would like to consider whether such potential business combinations are attractive
investments with an opportunity to consider such transactions, inasmuch as Pensare is also affording stockholders who wish to redeem
their public shares the opportunity to do so, as required under its charter. Accordingly, the Extension is consistent with Pensare’s
charter and IPO prospectus.
After careful consideration of all relevant
factors, Pensare’s board of directors determined that the Charter Amendment is fair to and in the best interests of Pensare
and its stockholders.
The Board of Directors recommends that
you vote “FOR” the Charter Amendment proposal. The Board of Directors expresses no opinion as to whether you should
redeem your public shares.
THE
DIRECTOR PROPOSAL
At the special meeting, shareholders are
being asked to re-elect four directors to the Board to serve as the first class of directors.
Prior to our IPO, the Board was divided
into two classes: the class I directors and the class II directors. The original class I directors stand elected for a term expiring
at the Company’s first annual meeting and the original class II directors stand elected for a term expiring at the Company’s
second annual meeting. Commencing at the first annual meeting, and then at each following annual meeting, directors elected to
succeed those directors whose terms expire are elected for a term of office to expire at the second annual meeting following their
election. Directors whose terms expire at an annual meeting may also be re-elected for a further two-year period if nominated by
the Board.
As the special meeting is in lieu of the
Company’s 2019 annual meeting (being the Company’s first annual meeting since its IPO), the terms of the current class
I directors, Dr. Klaas Baks and Messrs. U. Bertram Ellis, Karl Krapek and Dennis Lockhart, will expire at the special meeting.
However, the Board has nominated each of such individuals for re-appointment as class I directors, to hold office until the second
annual meeting of stockholders following this special meeting, or until his successor is elected and qualified.
Unless you indicate otherwise, shares represented
by executed proxies in the form enclosed will be voted to re-elect each of Dr. Baks and Messrs. Ellis, Krapek and Lockhart unless
any such individual is unavailable, in which case such shares will be voted for a substitute nominee designated by the Board. We
have no reason to believe that either nominee will be unavailable or, if elected, will decline to serve.
For a biography
of Dr. Baks and Messrs. Ellis, Krapek and Lockhart, please see the section entitled “
Management.
”
Required Vote
Approval of the
Director Proposal requires a plurality of the votes of Pensare’s shares present (in person or by proxy) at the special meeting
for each of the director nominees. You may vote for or withhold your vote for all, or any, of the nominees.
All of Pensare’s
directors, executive officers and their affiliates are expected to vote any shares owned by them in favor of each of the directors
named in the Director Proposal. On the record date, directors and executive officers of Pensare and their affiliates beneficially
owned and were entitled to vote 5,953,500 shares of common stock representing approximately 15.3% of Pensare’s issued and
outstanding shares of common stock.
Recommendation of the Board
The Board recommends
that you vote “FOR” the election of the nominees named above.
RATIFICATION
OF THE SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We are asking our shareholders to ratify
the selection by our Audit Committee of Marcum LLP to serve as the Company’s independent registered public accounting firm
for the fiscal year ending March 31, 2019. The Audit Committee is directly responsible for appointing the Company’s independent
registered public accounting firm. The Audit Committee is not bound by the outcome of this vote. However, if the shareholders do
not direct, in the manner set forth herein, the ratification of the selection of Marcum LLP to serve as the Company’s independent
registered public accounting firm for the fiscal year ending March 31, 2019, our Audit Committee intends to reconsider the selection
of Marcum LLP as the company’s independent registered public accounting firm.
Marcum LLP has audited our financial statements
for the fiscal year ended March 31, 2017. Representatives of Marcum LLP have been invited to but are not expected to be present
at the special meeting.
The aggregate fees billed to our Company
by Marcum LLP for the year ended March 31, 2018 and for the period from April 7, 2016 through March 31, 2017 are as follows:
|
|
Year
Ended
March 31, 2018
|
|
|
For the period April 7, 2016 (inception) through March 31, 2017
|
|
Audit Fees
(1)
|
|
$
|
63,176
|
|
|
$
|
10,000
|
|
Audit-Related Fees
(2)
|
|
$
|
—
|
|
|
$
|
—
|
|
Tax Fees
(3)
|
|
$
|
—
|
|
|
$
|
—
|
|
All Other Fees
(4)
|
|
$
|
—
|
|
|
$
|
—
|
|
Total
|
|
$
|
63,176
|
|
|
$
|
10,000
|
|
|
(1)
|
Audit Fees consist of fees incurred for the audits of our annual financial statements and financial
statements included in our registration statement on Form S-1, for the review of our unaudited interim consolidated financial statements
included in our quarterly reports on Form 10-Q for the first three quarters of the fiscal year and for fees incurred related
to other SEC filings.
|
|
(2)
|
Audit-Related Fees consist of fees incurred for accounting consultations, due diligence in connection
with planned acquisitions and research services.
|
|
(3)
|
Tax Fees consist of fees incurred for tax compliance, planning and advisory services and due diligence
in connection with planned acquisitions.
|
|
(4)
|
All Other Fees consist of products and services provided, other than the products and services
described in the other rows of the foregoing table.
|
Our audit committee
has and will pre-approve all auditing services and permitted non-audit services to be performed for us by Marcum LLP,
including the fees and terms thereof (subject to the
de minimus
exceptions for non-audit services described in
the Exchange Act which are approved by the audit committee prior to the completion of the audit). The audit committee may
form and delegate authority to one or more of its members when appropriate, including the authority to grant pre-approvals of audit
and permitted non-audit services, provided that decisions of such members to grant pre-approvals shall be presented to the audit
committee at its next scheduled meeting.
Required Vote
The resolution to ratify the selection by
our Audit Committee of Marcum LLP to serve as the Company’s independent registered public accounting firm requires the vote
of a majority of the shares present (in person or by proxy) and voting on the matter at the special meeting.
Recommendation
The Board recommends that you vote “FOR”
the ratification of the selection by our Audit Committee of Marcum LLP to serve as the Company’s independent registered public
accounting firm for the fiscal year ending March 31, 2019.
MANAGEMENT
Directors and Executive Officers
Our current directors and executive officers are as
follows:
Name
|
Age
|
Position
|
Lawrence E. Mock, Jr.
|
72
|
Chairman of the Board
|
Darrell J. Mays
|
55
|
Chief Executive Officer
|
Dr. Robert Willis
|
49
|
President
|
John Foley
|
69
|
Chief Financial Officer
|
Jose Mas
|
47
|
Director
|
U. Bertram Ellis, Jr.
|
65
|
Director
|
Suzanne Shank
|
57
|
Director
|
Karl Krapek
|
70
|
Director
|
Dennis Lockhart
|
71
|
Director
|
Dr. Klaas Baks
|
46
|
Director
|
Lawrence E. Mock,
Jr.
, our Chairman of the Board, is currently Managing Partner of Navigation Capital Partners, Inc., an Atlanta-based private
equity firm which he founded in partnership with Goldman Sachs in 2006. From 1995 to 2006, Mr. Mock served as President and Chief
Executive Officer of Mellon Ventures, Inc., which he founded in partnership with Mellon Financial Corporation, to make private
equity and venture capital investments in operating companies. From 1983 to 1995, he was founder and Chief Executive Officer of
River Capital, Inc. Mr. Mock holds a Master of Science degree from Florida State University and a Bachelor of Arts degree from
Harvard College.
Darrell Mays
,
our Chief Executive Officer, was the Founder and Chief Executive Officer of nsoro, a turnkey wireless installation services provider,
from 2003 to 2008, which was acquired by MasTec in August 2008. Mr. Mays has served as an executive of MasTec since 2008, during
which period the revenues and EBITDA of MasTec’s communications division, of which nsoro is a component, increased to approximately
$2.3 billion and $245.0 million in 2016, respectively. Mr. Mays holds a Bachelor of Arts degree in Business from Georgia State
University.
Dr. Robert Willis
,
our President, became the President of nsoro in 2007. In such capacity, he negotiated the acquisition of the business by MasTec
and, following its acquisition, served in an advisory role from 2010 through July 2016. From December 2013 until December 2015,
Dr. Willis served as Chairman of U.S. Shale Solutions, Inc., a shale services company which he founded in 2013. Prior to nsoro,
Dr. Willis served as Chief Executive Officer of Foxcode Inc., a merchant-banking firm, from 2004 until November 2015, in which
capacity he was principal on multiple debt and equity transactions. In July 2004, Dr. Willis founded Gaming VC, S.A., an online
gaming enterprise which completed a GBP 81 million initial public offering in London in 2004, and served as a member of its board
and as its Finance Director until 2007. Prior to that, Dr. Willis was the founder and Chief Executive Officer of Alpine Computer
Systems, Inc., a systems integration engineering company established in the 1980s that grew rapidly and was acquired by Delphi
Group plc. in 1996, at which time he became Senior Vice President and Chief Information Officer of the parent company. Dr. Willis
was a member of a three-man North American roll-up M&A team which ultimately acquired approximately 25 businesses. After an
ADR NASDAQ offering, the company was acquired by Adecco Group AG. Dr. Willis subsequently reacquired the company and then merged
it into Aimnet Solutions Inc., backed by Mellon Ventures and William E. Simon & Sons. The business was ultimately acquired
by Cognizant Inc., a large public IT services company. Dr. Willis was awarded a Doctorate in Humane Letters (Hon.) from Newbury
College in Boston, MA, in May 2001.
John Foley
,
our Chief Financial Officer, was the former Chief Financial Officer of nsoro MasTec from 2007 until his retirement in December
2015. During his tenure, Mr. Foley oversaw the financial integration of seven acquisitions. He also held executive positions which
were responsible for the financial and operations at Burger King, Diageo PLC and Chiquita Brands International, Inc. Mr. Foley
holds a Bachelor of Science degree in Finance from Boston College, where he graduated with honors.
Jose Mas
has
served on our board of directors since July 2017. He has served as a director and Chief Executive Officer of MasTec since 2007.
MasTec is a leading infrastructure construction company operating mainly throughout North America across a range of industries.
MasTec’s primary activities include the engineering, building, installation, maintenance and upgrade of communications, energy
and utility infrastructure, such as: wireless, wireline/fiber, satellite communications and customer fulfillment activities; petroleum
and natural gas pipeline infrastructure; electrical utility transmission and distribution; conventional and renewable power generation;
and industrial infrastructure. As of March 31, 2017, MasTec had over 18,500 employees and 500 locations, and generated over $5.1
billion in revenue in 2016, more than five times greater than its 2006 revenues. Mr. Mas was also appointed to the Board of Directors
of Helmerich & Payne, Inc. on March 1, 2017. Mr. Mas holds a Master of Business Administration and Bachelor of Business Administration
degree from the University of Miami.
U. Bertram Ellis,
Jr.
has served on our board of directors as an independent director since July 2017. He has served as the Chairman and Chief
Executive Officer of Ellis Capital, a diversified investment firm, since 1984. In addition, Mr. Ellis was the Founder and Chief
Executive Officer of ACT III Broadcasting from 1986 to 1991, which sold for $530 million and Ellis Communication from 1993 to 1996,
which sold for $840 million. Mr. Ellis holds a Master of Business Administration from the University of Virginia Darden Business
School and a Bachelor of Arts from the University of Virginia.
Suzanne Shank
has served on our board of directors as an independent director since July 2017. She has served as Chairman, Chief Executive Officer
and majority owner of Siebert Cisneros Shank & Co., a full-service investment bank that has managed or co-managed over $2 trillion
in transactions, since 1996. Mrs. Shank holds a Master of Business Administration from the Wharton School at the University of
Pennsylvania and a Bachelor of Science from the Georgia Institute of Technology.
Karl Krapek
has served on our board of directors as an independent director since July 2017. He has served as the Lead Director at Prudential
Financial, Inc. since 2014, and a Director since 2004, and Director of Northrop Grumman Corporation since 2008. From 2002 to 2009,
he was the President and Chief Operations Officer of United Technologies Corporation, or UTC, which has a market capitalization
of approximately $90 billion. Mr. Krapek has served as an Executive Vice President of UTC since 1997 and as a Director of UTC from
1997 to 2007. Mr. Krapek holds a Master of Science from Purdue University and Bachelor of Science from Kettering University.
Dennis Lockhart
has served on our board of directors as an independent since July 2017. He recently retired from his position as president and
Chief Executive Officer of the Federal Reserve Bank of Atlanta, a position he held from 2007 to 2017. Earlier, he was a professor
at Georgetown University, School of Foreign Service, from 2003 to 2007. Prior to this, he held senior positions at Heller Financial
Inc. and Citicorp (now Citigroup). Mr. Lockhart holds a Master of Arts from Johns Hopkins University and a Bachelor of Arts from
Stanford University.
Dr. Klaas Baks
has served on our board of directors as an independent since July 2017. He is the Co-Founder and Executive Director of the Emory
Center for Alternative Investments, which was formed in 2008. He also serves as the Atlanta Chair of TIGER 21, which is a peer-to-peer
network of high net worth wealth creators, since 2014. In addition, he has been an Associate Professor in the Practice of Finance
at Emory University’s Goizueta Business School since 2002. Dr. Baks has a Doctoral degree from the Wharton School at the
University of Pennsylvania and a Masters of Arts degree from Brown University.
Special Advisors
Rayford Wilkins,
Jr.
, our Special Advisor, served as Chief Executive Officer of AT&T Diversified Businesses and Chairman and President of
AT&T International. Prior to these positions, he served as Group President Marketing and Sales. In addition, he occupied various
positions associated with the wireless industry at SBC Group and has held several leadership roles in his more than 30-year career
at AT&T and its predecessor companies. Mr. Wilkins is currently a director at Morgan Stanley, Valero Energy and Caterpillar.
Dr. David Panton
,
our Special Advisor, has served as Chairman and Chief Executive Officer of Panton Equity Partners, a private equity firm, since
founding it in 2012. Prior to that, he was a partner of Navigation Capital Partners, an Atlanta-based private equity firm which
he founded in partnership with Goldman Sachs in 2006. He has 20 years of investment banking and private equity experience and has
sourced and led over 20 control transactions in various industries (including the telecom, media and technology industry) with
an aggregate enterprise value of over $5 billion, including successful sales of portfolio companies to buyers such as Dell Inc.,
the Blackstone Group, and One Equity Partners.
Michael Pietropola
,
our Special Advisor, has served as President of Pietropola Consulting, a telecommunications consulting firm, since October 2015.
Previously, he served as Vice President of Construction & Engineering for AT&T from January 2012 to October 2015, and as
Vice President of Network Services for AT&T (and Cingular prior to its acquisition by AT&T) from June 2007 to January 2012.
Designated Director
MasTec has the right
to designate a director to our board of directors. MasTec’s initial designee on our board of directors was Mr. Jose Mas.
Prior to the consummation of our initial business combination, we will nominate MasTec’s designee for election at each annual
meeting, so long as MasTec beneficially owns not less than 25% of the founders’ shares and private warrants that it owns
at the time of the closing of our initial public offering. MasTec may waive its right to designate a director and instead have
the right to have a board observer attend all of the meetings of our board of directors and receive all information provided to
our board of directors, subject to such board observer executing an appropriate confidentiality agreement with us.
Number and Terms of Office of Officers and Directors
Our board of directors
is divided into two classes with only one class of directors being elected in each year and each class (except for those directors
appointed prior to our first annual meeting of stockholders) serving a two-year term. The term of office of the first class of
directors, consisting of Messrs. Ellis, Krapek and Lockhart and Dr. Baks, will expire at the special meeting. The term of office
of the second class of directors, consisting of Ms. Shank and Messrs. Mays, Mock and Mas, will expire at the second annual meeting
of stockholders.
Our officers are elected
by the board of directors and serve at the discretion of the board of directors, rather than for specific terms of office. Our
board of directors is authorized to appoint persons to the offices set forth in our amended and restated bylaws as it deems appropriate.
Our amended and restated bylaws provide that our officers may consist of a Chairman of the Board, Chief Executive Officer, President,
Chief Financial Officer, Secretary and such other officers (including, without limitation, Vice Presidents, Assistant Secretaries
and a Treasurer) as may be determined by the board of directors.
Committees of the Board of Directors
Our board of directors
has three standing committees: an audit committee, a nominating committee and a compensation committee.
Audit Committee
We have an audit committee
comprised of Messrs. Lockhart and Baks and Ms. Shank, each of whom is an independent director. Darren Thompson serves as the Chairman
of the audit committee. Each member of the audit committee is financially literate, and our board of directors has determined that
Darren Thompson qualifies as an “audit committee financial expert” as defined in applicable SEC rules because
he meets the requirement for past employment experience in finance or accounting, requisite professional certification in accounting
or comparable experience. The responsibilities of our audit committee include:
|
●
|
reviewing and discussing with management and the independent auditor the annual audited financial statements, and recommending
to the board whether the audited financial statements should be included in our Form 10-K;
|
|
●
|
discussing with management and the independent auditor significant financial reporting issues and judgments made in connection
with the preparation of our financial statements;
|
|
●
|
discussing with management major risk assessment and risk management policies;
|
|
●
|
monitoring the independence of the independent auditor;
|
|
●
|
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;
|
|
●
|
reviewing and approving all related-party transactions;
|
|
●
|
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 auditor, including the
fees and terms of the services to be performed;
|
|
●
|
appointing or replacing the independent auditor;
|
|
●
|
determining the compensation and oversight of the work of the independent auditor (including resolution of disagreements between
management and the independent auditor 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; and
|
|
●
|
approving reimbursement of expenses incurred by our management team in identifying potential target businesses.
|
Nominating Committee
Our nominating committee
consists of Messrs. Lockhart and Krapek and Ms. Shank, each of whom is an independent director under Nasdaq’s listing standards.
The nominating committee is responsible for overseeing the selection of persons to be nominated to serve on our board of directors.
The nominating committee considers persons identified by its members, management, shareholders, investment bankers and others.
The guidelines for
selecting nominees, which are specified in our Nominating Committee Charter, generally provide that persons to be nominated:
|
●
|
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 our shareholders.
|
The nominating committee
will consider a number of qualifications relating to management and leadership experience, background, integrity and professionalism
in evaluating a person’s candidacy for membership on the board of directors. The nominating committee may require certain
skills or attributes, such as financial or accounting experience, to meet specific board needs that arise from time to time and
will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of board members. The nominating
committee does not distinguish among nominees recommended by shareholders and other persons.
Compensation
Committee
Our compensation committee
consists of Messrs. Ellis, Baks and Krapek, each of whom is an independent director under Nasdaq’s listing standards. The
compensation committee’s duties, which are specified in our Compensation Committee Charter, include, but are not limited
to:
|
●
|
reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s
compensation, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining
and approving the remuneration (if any) of our Chief Executive Officer’s based on such evaluation;
|
|
●
|
reviewing and approving the compensation of all of our other executive officers;
|
|
●
|
reviewing our executive compensation policies and plans;
|
|
●
|
implementing and administering our incentive compensation equity-based remuneration plans;
|
|
●
|
assisting management in complying with our proxy statement and annual report disclosure requirements;
|
|
●
|
approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our executive
officers and employees;
|
|
●
|
if required, producing a report on executive compensation to be included in our annual proxy statement; and
|
|
●
|
reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.
|
Code of Ethics and Committee Charters
We have adopted a Code
of Ethics applicable to our directors, officers and employees. We have filed a copy of our Code of Ethics, our audit committee
charter, our nominating committee charter and our compensation committee charter as exhibits to our registration statement. You
will be able to review these documents by accessing our public filings at the SEC’s web site at www.sec.gov. In addition,
a copy of the Code of Ethics will be provided without charge upon request from us. We intend to disclose any amendments to or waivers
of certain provisions of our Code of Ethics in a current report on Form 8-K.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the
Securities Exchange Act of 1934 requires our officer, directors and persons who own more than ten percent of a registered class
of our equity securities to file reports of ownership and changes in ownership with the SEC. Officers, directors and ten percent
stockholders are required by regulation to furnish us with copies of all Section 16(a) forms they file. Based solely on copies
of such forms received, we believe that, during the fiscal year ended March 31, 2018, all filing requirements applicable to our
officer, directors and greater than ten percent beneficial owners were complied with.