Item 8.01. Other Events.
As previously disclosed, two (the "Company") will hold an extraordinary general
meeting of its shareholders on March 31, 2023 (the "Shareholders Meeting") to
submit for shareholder approval a proposal to extend the date by which the
Company must consummate its initial business combination by nine months, from
April 1, 2023 to January 1, 2024 (the "Extension Proposal"). In connection with
the Extension Proposal, shareholders may elect to redeem their Class A ordinary
shares for a pro rata portion of the funds held in the trust account (the "Trust
Account"). The deadline for submitting redemptions is 5:00 p.m., New York time,
on March 29, 2023. The Company intends to present to shareholders, to the extent
it is able to do so under applicable law and regulations, a proposal to be
approved by special resolution, that the name of the Company be changed from
"two" to "PropTech Investment Corporation III."
The Company has been advised that, on March 22, 2023 two sponsor ("Sponsor")
entered into a term sheet (the "Term Sheet") with HC Proptech Partners III, LLC
("HC Proptech Partners" or "Buyer") (Sponsor and HC Proptech Partners together,
the "Parties"), pursuant to which, among other things, HC Proptech Partners will
purchase up to 4,854,375 Class B ordinary shares ("Sponsor Shares") of two (the
"Company") from Sponsor, the current directors and officers of the Company will
resign, and new directors and officers designated by Buyer will be appointed.
The Company is not a party to the Term Sheet.
The Term Sheet provides that definitive documentation regarding the transfer of
Sponsor Shares and the other matters contemplated by the Term Sheet (the
"Definitive Agreement") shall be executed on or before March 29, 2023, with the
consummation of the transactions contemplated thereby (the "Closing") to occur
on March 31, 2023, unless such date is extended by mutual agreement of HC
Proptech Partners and Sponsor. Sponsor has agreed to enter into the Definitive
Agreement provided that the terms thereof are not materially inconsistent with
the Term Sheet, subject to applicable law.
If the Definitive Agreement is not executed by March 29, 2023, or if the Company
determines that the Closing is unlikely to occur, it is the intention of the
Company not to submit the Extension Proposal for shareholder approval, and to
proceed with the liquidation of the Company.
The following is a summary of the material terms of the Term Sheet.
Sale of Class B Ordinary Shares
Pursuant to the Term Sheet, the Definitive Agreement will provide that,
concurrently with the Closing, Sponsor shall transfer to Buyer 4,854,375 Sponsor
Shares, less an agreed upon number of Sponsor Shares that may be transferred to
investors in connection with agreements by such investors not to redeem their
Class A ordinary shares in connection with the Shareholders Meeting, and the
Extension Proposal. The Term Sheet also contemplates that Buyer will provide
cash consideration to Sponsor in connection with the transfer of the Sponsor
Shares.
Officer and Directors
Concurrently with the Closing, the current directors of the Company shall
appoint new officers and directors as follows: (i) Thomas Hennessy - Chairman,
CEO and Interim CFO, (ii) M. Joseph Beck - Director, (iii) Jack Leeney -
Director and (iv) Adam Blake - Director (Messrs. Hennessy, Beck, Leeney and
Blake, collectively, the "New Directors"). The current officers of the Company
shall resign, effective immediately upon the appointment of Mr. Hennessy, and
the current directors of the Company shall resign immediately following the
appointment of Messrs. Hennessy, Beck, Leeney and Blake.
Biographies for Mr. Hennessy and each of the New Directors are set forth below.
Thomas D. Hennessy has served as a Managing Partner of Growth Strategies of
Hennessy Capital Group, LLC, an alternative investment firm founded in 2013 that
focuses on investing in industrial, infrastructure, climate and real estate
technologies. Mr. Hennessy has served as a director of Jaguar Global Growth
Corporation I (NASDAQ: JGGC), a special purpose acquisition company targeting
business operating primarily outside of the United States in the PropTech
sector, since February 2021. Since December 2020, he has served as a director of
7GC & Co. Holdings Inc. (NASDAQ: VII), a special purpose acquisition company
targeting the technology industry. Since 2019, Mr. Hennessy, in his role as
Chairman, Co-Chief Executive Officer and President, has executed two successful
SPAC business combinations, including (i) PropTech Investment Corporation's
("PTAC") business combination with Porch Group, Inc. (Nasdaq: PRCH) in 2020; and
(ii) PropTech Investment Corporation II's ("PTIC") business combination with
Appreciate Holdings, Inc. (Nasdaq: SFR) in 2022. Since 2021, Mr. Hennessy has
also invested in 14 privately-held companies in his capacity as Managing Partner
of Hennessy Capital Growth Partners, a growth equity fund that serves as a
strategic capital and growth partner to real estate technology and climate
technology companies. Mr. Hennessy served from 2014 to 2019 as a Portfolio
Manager of Abu Dhabi Investment Authority, or ADIA. Mr. Hennessy holds a B.A.
degree from Georgetown University and an M.B.A. from the University of Chicago
Booth School of Business.
M. Joseph Beck has served as a director of Jaguar Global Growth Corporation I, a
special purpose acquisition company targeting business operating primarily
outside of the United States in the PropTech sector, since February 2021. Since
December 2020, he has served as a director of 7GC & Co. Holdings Inc.
(NASDAQ: VII), a special purpose acquisition company targeting the technology
industry. From July 2019 to December 2020, he served as Co-Chief Executive
Officer, Chief Financial Officer and director of PTAC. Mr. Beck has served as a
Managing Partner of Growth Strategies of Hennessy Capital Group LLC since
July 2019. From August 2012 to July 2019, Mr. Beck served as a Senior Investment
Manager of ADIA. From July 2008 to August 2012, Mr. Beck served as an analyst in
the Investment Banking Division of Goldman, Sachs & Co. Mr. Beck holds a B.A.
degree from Yale University.
Adam Blake is an independent investor. He served as an independent director of
PTIC from December 2020 until November 2022. In January 2017, Mr. Blake
co-founded Zego Inc., a digital amenity and resident engagement platform for
apartments, for which he served as the Chief Executive Officer until April 2019,
when it was acquired by PayLease, a portfolio company of Vista Equity Partners.
In October 2010, Mr. Blake founded Brightergy, an energy service and software
company, for which he served as Chief Executive Officer until July 2016.
Previously, Mr. Blake was a real estate investor and developer specializing in
multi-family apartments and other types of real estate investments. Mr. Blake
holds a B.B.A degree from Texas Christian University.
Jack Leeney has served as Chairman and Chief Executive Officer of 7GC & Co.
Holdings (Nasdaq: VII) since 2020. Since 2019, he has served as an independent
director of PTAC (merged with Porch) and PTIC (merged with Appreciate Holdings,
Inc.). Since 2016, Mr. Leeney has served as a Co-Founder and Managing Partner of
7 Global Capital, a growth stage venture capital firm. Mr. Leeney led the firm's
investments in Cheddar (sold to Altice USA, May 2019), Capsule Corp., hims &
hers (IPO, January 2021, NYSE: HIMS), Roofstock, The Mom Project, Reliance Jio,
Because Market and Jackpocket. He currently serves on the board of directors of
The Mom Project and Because Market. Between April 2011 and December 2016, Mr.
Leeney served on the boards of directors of Quantenna Communications, Inc.
(NASDAQ: QTNA), DoAt Media Ltd. (Private), CinePapaya (acquired by Comcast),
Joyent (acquired by Samsung), BOKU, Inc. (AIM: BOKU), Eventful (acquired by CBS)
and Blueliv (Private). Previously, Mr. Leeney served as the Head of U.S.
Investing for Telefonica Ventures between June 2012 and September 2016, the
investment arm of Telefonica (NYSE: TEF), served as an investor at Hercules
Capital (NYSE: HTGC) between May 2011 and June 2012 and began his career as a
technology-focused investment banker at Morgan Stanley in 2007. Mr. Leeney holds
a B.S. from Syracuse University.
Non-Redemption Agreements
Pursuant to the Term Sheet, Sponsor will seek to enter into one or more
non-redemption agreements with holders of Class A ordinary shares such that,
after giving effect to all redemptions, at least $50 million remains in the
Trust Account (or such greater amount as may be required in order to comply with
the continued listing requirements of the New York Stock Exchange (the "NYSE")).
Conditions to Closing
The Closing is subject to the satisfaction or waiver of certain customary
closing conditions, including, among other things, (i) approval of the Extension
Proposal, (ii) the retention of at least $50 million in the Trust Account at
Closing (or such other greater amount needed in order to satisfy the continued
listing requirements of the NYSE), (iii) the resignation of the current officers
and directors of the Company and their replacement by the individuals described
above, (iv), the availability of the Company's D&O insurance policy, (v) the
Company meeting all continued listing requirements of the NYSE, (vi) Mr.
Hennessy and the New Directors entering into appropriate agreements with the
Company, including, without limitation, an insider letter, registration rights
agreement and indemnity agreement and (vii) the delivery of necessary documents
in order to effect the transfer of securities as required by the Company's
transfer agent. In addition, the Closing is conditioned upon the completion of
satisfactory due diligence by Buyer.
Termination
The Term Sheet may be terminated by Buyer with one (1) day advance notice.
Miscellaneous
The Definitive Agreement shall contain customary representations and warranties
by each of the Parties.
The Term Sheet also provides that, among other things, (i) the Parties will work
expeditiously and in good faith to execute the Definitive Agreement, (ii) each
Party will bear its own expenses in connection with the matters described
herein, (iii) the Parties will keep confidential certain information relating to
the Term Sheet for a period of one year, (iv) the Term Sheet shall be governed
by and enforced in accordance with the laws of the State of New York and (v) the
Sponsor will not enter into or continue discussions with any other potential
buyers of Sponsor Shares. The Term Sheet also provides that each Party shall
indemnify the other for losses sustained as a result of the breach of
representations, warranties or covenants, and that the Sponsor shall cause the
Company to be free and clear of any and all outstanding expenses, debts and
other liabilities.
Participants in the Solicitation
The Company and its directors and executive officers and other persons may be
deemed to be participants in the solicitation of proxies from the Company's
shareholders in respect of the Shareholders Meeting and the Extension Proposal
and related matters. Information regarding the Company's directors and executive
officers is available in the Company's proxy statement for the Shareholders
Meeting filed with the U.S. Securities and Exchange Commission ("SEC") on March
10, 2023 (the "Definitive Proxy Statement"). Additional information regarding
the participants in the proxy solicitation and a description of their direct and
indirect interests are contained in the Definitive Proxy Statement.
No Offer or Solicitation
This communication shall not constitute an offer to sell or the solicitation of
an offer to buy any securities, nor shall there be any sale of securities in any
jurisdiction in which the offer, solicitation or sale would be unlawful prior to
the registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities Act of 1933,
as amended, or an exemption therefrom.
Additional Information
The Company has filed with the SEC the Definitive Proxy Statement in connection
with the Shareholders Meeting to consider and vote upon the Extension and other
matters and, beginning on or about March 13, 2023, mailed the Definitive Proxy
Statement and other relevant documents to its shareholders as of the February
23, 2023 record date for the Shareholders Meeting. The Company's shareholders
and other interested persons are advised to read the Definitive Proxy Statement
and any other relevant documents that have been or will be filed with the SEC in
connection with the Company's solicitation of proxies for the Shareholders
Meeting because these documents contain important information about the Company,
the Extension and related matters. Shareholders may also obtain a free copy of
the Definitive Proxy Statement, as well as other relevant documents that have
been or will be filed with the SEC, without charge, at the SEC's website located
at www.sec.gov or at www.twoa.a-star.co.
Forward-Looking Statements
The information included herein may include, and oral statements made from time
to time by representatives of the Company may include, "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
Statements regarding possible business combinations and the financing thereof,
and related matters, as well as all other statements other than statements of
historical fact included in this document are forward-looking statements. When
used in this document, words such as "anticipate," "believe," "continue,"
"could," "estimate," "expect," "intend," "may," "might," "plan," "possible,"
"potential," "predict," "project," "should," "would" and similar expressions, as
they relate to us or our management team, identify forward-looking statements.
Such forward-looking statements are based on the beliefs of management, as well
as assumptions made by, and information currently available to, the Company's
management. Actual results could differ materially from those contemplated by
the forward-looking statements as a result of certain factors detailed in the
Company's filings with the SEC. All subsequent written or oral forward-looking
statements attributable to us or persons acting on our behalf are qualified in
their entirety by this paragraph. Forward-looking statements are subject to
numerous conditions, many of which are beyond the control of the Company,
including those set forth in the Risk Factors section of the Company's
Definitive Proxy Statement and the Company's registration statement and
prospectus for the Company's initial public offering filed with the SEC. The
Company undertakes no obligation to update these statements for revisions or
changes after the date of this release, except as required by law.
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