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Focus Impact BH3 Acquisition Company *

Focus Impact BH3 Acquisition Company *

Sep 2, 2021 by sam.beattie

PROPOSED BUSINESS COMBINATION: XCF Global Capital, Inc.

ENTERPRISE VALUE: $1.83 billion
ANTICIPATED SYMBOL: TBD

Focus Impact BH3 Acquisition Co. entered into a definitive Business Combination Agreement with XCF Global Capital, Inc.

  • XCF Global Capital is a leading producer of renewable diesel and sustainable aviation fuel in North America. The company’s fuels are made from renewable sources, such as waste vegetable oil and animal fats, and can be used to reduce greenhouse gas emissions from transportation.

SUBSEQUENT EVENT – 9/25/24 – LINK

  • The deferred underwriting fee was waived.

EXTENSION – 8/6/24 – LINK

  • The SPAC approved the extension from July 31, 2024, to April 7, 2025.
    • 1,099,905 shares were redeemed.
    • No contribution will be made into the trust account.
  • In connection with the extension vote, the SPAC signed a non-redemption agreement for 1,047,399 shares.
    • Such stockholders will receive an aggregate of 174,566 Promote Shares or up to 232,750 if the additional two monthly extensions are used.

TRANSACTION

  • Existing XCF shareholders are anticipated to roll 100% of their equity ownership and will own a pro forma equity ownership of approximately 91.6% in the newly combined entity.
  • The proposed transaction implies a pro forma enterprise value for the combined company of $1.83 billion.
  • Each of XCF Global’s and Focus Impact BH3’s Board of Directors have approved the proposed business combination, which is anticipated to close in the first quarter of 2025.

 

Updated Transaction Overview 

 

Original Transaction Overview

 

SPAC FUNDING

  • $50 million of PIPE financing intends to be raised.

LOCK-UP

  • Sponsor and Company:
    • The Sponsor and Company agreed to lock-up their shares of NewCo Common Stock until the earlier of:
      • (i) 12 months following the Closing, and
      • (ii) if the closing price of the shares of NewCo Common Stock equal or exceed $12.00 per share for any 20 trading days within a 30-trading day period commencing at least 150 days after the Closing.

NOTABLE CONDITIONS TO CLOSING

  • BHAC and XCF shareholder approvals

NOTABLE CONDITIONS TO TERMINATION

  • The Business Combination Agreement may be terminated if the Closing has not occurred on or prior to September 11, 2024 (the “Termination Date”), provided that the Termination Date will be automatically extended to November 11, 2024 if the Registration Statement is not declared effective on or prior to September 11, 2024.
    • The termination date was extended from November 11, 2024 to March 31, 2025. – LINK

ADVISORS

  • XCF Advisors:
    • Cohen & Company Capital Markets, a division of J.V.B. Financial Group, LLC, acted as exclusive financial advisor and joint capital markets advisor
    • Height Capital Markets served as joint capital markets advisor
    • Stradley Ronon Stevens & Young, LLP served as legal counsel
  • SPAC Advisors:
    • BTIG, LLC acted as capital markets advisor
    • Kirkland & Ellis LLP served as legal counsel

LETTER OF INTENT – 12/29/23 – LINK

  • The SPAC entered into a letter of intent (LOI) with XCF Global Capital, Inc. (“XCF”), a New York-based producer of sustainable fuels.
    • The transaction, which values XCF at $$1.75Bn, is subject to the completion of due diligence, negotiation of and entry into definitive documentation and will be subject to customary closing conditions.
    • There can be no assurances that a transaction will be executed or consummated.

SUBSEQUENT EVENT – 11/8/23 – LINK

  • On November 3, 2023, the Company entered into a Subscription Agreement with Polar Multi-Strategy Master Fund, potentially providing up to $1,200,000 in capital contributions, to be repaid within five business days of an initial business combination, with the option for cash or common stock repayment at a rate of one share for each $10.00 contributed, and additional common stock issuance at the Closing based on the Capital Contribution amount, subject to default-related provisions, and potential repayment if the Company liquidates without a business combination.

EXTENSION – 10/6/23 – LINK

  • The SPAC approved the extension from October 6, 2023 to July 31, 2024.
    • 2,700,563 shares were redeemed.
    • No contribution will be made into the trust account.

SUBSEQUENT EVENT – 10/3/23 – LINK

  • The SPAC entered into a non-redemption agreement with the same parties of the Purchase Agreement in exchange for them agreeing not to redeem an undisclosed amount of shares.

SUBSEQUENT EVENT – 9/28/23 – LINK

  • On September 27, 2023, Crixus BH3 Acquisition Company, Crixus BH3 Sponsor LLC, and Focus Impact BHAC Sponsor, LLC made a Purchase Agreement.
    • The New Sponsor will buy 3,746,303 Class B common stock shares and 4,160,000 private placement warrants for $16,288.27.
  • The new sponsor will appoint new board members and Eric Edidin will remain on the board.
  • The new sponsor will reimburse the previous sponsor for the most recent extension payment.
  • Following the consummation of the Purchase, the Company intends to change its name from “Crixus BH3 Acquisition Company” to “Focus Impact BH3 Acquisition Company.”
  • The Company can accept a lower Minimum Trust Account Balance, as long as it’s no less than $20.0 million and not below $35.0 million.
    • They believe that this revised amount, combined with additional equity or debt financing, would be enough to complete their initial business combination.

Anchor Transfer Agreements

  • According to this agreement, each anchor will transfer 2/3 of their Class B common stock without compensation, as directed by the Sponsor.
    • However, if an anchor investor requests, the Sponsor will pay them $0.0043 per share.
    • The Anchor Transfer Agreement will end if the Purchase is not completed by October 16, 2023, if the transfer of the Sponsor’s Class B common stock and private placement warrants doesn’t happen when the Purchase closes, or if the Sponsor’s statements are incorrect.

LIQUIDATION – 8/30/23 – LINK [LIQUIDATION REVERSED]

  • The Company anticipates that the last day of trading in the Class A ordinary shares will be September 6, 2023.
    • The per-share redemption price was not mentioned

EXTENSION – 12/7/22 – LINK

  • As approved by its stockholders at the Special Meeting, the Company extended the initial period of time by which the Company has to consummate an initial business combination to the New Termination Date, provided that, in each case, Crixus BH3 Sponsor LLC (the “Sponsor”) has provided to the Company a notice of such extension no later than five business days prior to August 7, 2023 or such thirty-day period, as applicable, and deposited $0.035 per public shares then outstanding.
  • In connection with the stockholders’ vote at the Special Meeting of Stockholders held by the Company on December 7, 2022, 17,987,408 shares were tendered for redemption.
  • After giving effect to the foregoing redemptions, the Company expects to have approximately $51.2 million remaining in the Trust Account.

SUBSEQUENT EVENT – 11/30/22 – LINK

  • In connection with the Special Meeting, the Proxy Statement provides that
    • (i) in order to be able to consummate an initial business combination by the New Termination Date, the Company believes that it will need between approximately $75.0 million and $100.0 million to remain in the Trust Account after giving effect to redemption elections in connection with the approval of the Charter Amendment Proposal (such minimum, the “Minimum Trust Account Balance”) and
    • (ii) if enough public stockholders elect to have the Company redeem their public shares in connection with the approval of the Charter Amendment Proposal such that the Company believes that the Minimum Trust Account Balance will not be achieved after giving effect to such redemption elections, the Company intends to not submit the Charter Amendment Proposal and the Trust Amendment Proposal to a vote of the Company’s stockholders at the Special Meeting.
  • Notwithstanding anything set forth in the Proxy Statement, in order to adhere to the Compliance Threshold, the Company
    • (i) may accept a Minimum Trust Balance less than $75.0 million (but not less than $45.0 million) and/or greater than $100.0 million (but not greater than $135.0 million) (the “Revised Minimum Trust Account Balance”)
    • (ii) believes that such Revised Minimum Trust Account Balance would still be sufficient to consummate its initial business combination, and
    • (iii) currently intends to submit the Charter Amendment Proposal and the Trust Amendment Proposal to a vote of the Company’s stockholders at the Special Meeting based on the Revised Minimum Trust Account Balance.

MANAGEMENT & BOARD

Executive Officers

Carl M. Stanton, — [Appointed]
Co-Chief Executive Officer and Director

Carl is a Partner and Co-Founder of Focus Impact Partners, LLC, and currently serves as the Chief Executive Officer of Focus Impact Acquisition Corp., a special purpose acquisition corporation (Nasdaq: FIAC), which has entered into a business combination agreement with DevvStream Holdings Inc. With nearly three decades of experience in transformative Private Equity/Alternative Asset management, Carl has a proven track record in creating shareholder value and extensive knowledge across Asset Management. He has co-led two Alternative Asset Management firms with over $4.5 billion AUM and delivered strong investment performance results. Carl’s expertise includes advising executives and boards on value creation strategies, revenue growth, cost control, supply chain management, and technology best practices. He also serves on the board of various portfolio companies across different industries. Previously, Carl was Managing Partner and Head of Private Equity at Invesco Private Capital, and Managing Partner at Wellspring Capital Management LLC. He holds a BS degree in Accounting from the University of Alabama and an MBA from Harvard Business School, and is actively involved in various nonprofit organizations and the University of Alabama’s College of Commerce.

Ernest D. Lyles II, — [Appointed]
Co-Chief Executive Officer and Director

Ernest is the Chief Financial Officer of Focus Impact Acquisition Corp., a special purpose acquisition corporation (Nasdaq: FIAC), and also the CEO of The HiGro Group, a mission-driven private equity firm specializing in lower middle-market buyout investments. He founded The HiGro Group in 2016, where he oversees all aspects of the firm, including investments, growth initiatives, and talent management. Ernest serves on the boards of EMSAR and DRS Imaging Services, both HiGro portfolio companies, and previously worked for a decade as an investment banker at UBS Investment Bank, where he advised prominent corporations and private equity firms. Notably, he was the most senior African-American investment banker within the firm’s industry coverage groups while heading the technology and business services division. Ernest is a director on the boards of Citizens Committee for New York, Scan/Harbor, and Manhattan Country School. He is also a member of the New York Economic Club and the founder of the UTULIVU Group, a non-profit focused on holistic achievement for high-performing Black men. Ernest attended The Howard University School of Law in Washington DC and Shepherd University in West Virginia.

Wray T. Thorn, — [Appointed]
Co-Chief Executive Officer and Director

Wray is a Partner and Co-Founder of Focus Impact Partners, LLC and currently serves as the Chief Investment Officer of Focus Impact Acquisition Corp., a special purpose acquisition corporation (Nasdaq: FIAC), which has a business combination agreement with DevvStream Holdings Inc. He is also the Founder and Chief Executive of Clear Heights Capital, a private investment firm focused on assisting companies in achieving their growth and development goals. Wray has over two decades of experience as a Chief Investment Officer, investment leader, and lead director, with a strong emphasis on ESG principles and innovative private investing. He previously served as Managing Director and Chief Investment Officer of Private Investments at Two Sigma Investments, where he oversaw private equity, venture capital, and impact investment businesses. Prior to that, Wray held positions at Marathon Asset Management, Fox Paine & Co., Dubilier & Co., and Chemical Bank. He has been involved in numerous transactions and served on the boards and committees of over 30 companies and investment funds. Wray is also dedicated to community service, including his role as Co-Chair of the Board of Youth, INC. He holds an A.B. from Harvard University.

Daniel Lebensohn, 49 [Resigned]
Co-Chief Executive Officer and Director

Mr. Lebensohn has been Co-Chief Executive Officer of BH3 Management since 2009 and Co-Portfolio Manager of BH3 Debt Opportunity Fund I, L.P. since 2018, where, in conjunction with Gregory Freedman, he oversees all acquisitions, investing activities, financings, development, related operating company oversight and various fiduciary responsibilities for more than 25 affiliated real estate investment and development companies. Prior to co-founding BH3 Management, Mr. Lebensohn practiced commercial real estate law for over ten years at Hartman and Craven LLP, during a portion of which he served as in-house counsel to a Manhattan based real estate owner, operator and developer, and invested in and operated various real estate investments. He has over two decades of investment and operational experience related to the real estate and construction sectors. Mr. Lebensohn holds a Bachelor’s Degree in English from SUNY Albany and a Juris Doctorate from The New York Law School.

Gregory Freedman, 41 [Resigned]
Co-Chief Executive Officer, Chief Financial Officer and Director

Mr. Freedman has been Co-Chief Executive Officer of BH3 Management since 2009 and Co-Portfolio Manager of BH3 Debt Opportunity Fund I, L.P. since 2018, where, in conjunction with Daniel Lebensohn, he oversees all acquisitions, investing activities, financings, development, related operating company oversight and various fiduciary responsibilities for more than 25 affiliated real estate investment and development companies. Prior to co-founding BH3 Management, Mr. Freedman managed a private bridge lending firm focused on providing transitional debt products for commercial and residential real estate. He has 18 years of investment and operational experience related to the real estate and construction sectors and holds a Bachelor’s Degree in Finance from Florida Atlantic University.

Michelle Guber, 35 [Resigned]
Chief Operating Officer

Ms. Guber has been the Chief Operating Officer of BH3 Management since 2018 and was an Assistant Portfolio Manager of BH3 Management from 2018 until 2020. From 2015 to 2017, Ms. Guber was a member of the Capital Markets Group at Hines, a multi-national privately owned real estate development firm active in 25 countries. While at Hines, she was involved in developing and cultivating capital partnerships with institutional investors for a variety of Hines investments and development projects. Ms. Guber holds a Bachelor’s Degree in Finance from the University of Colorado – Boulder and a Master’s Degree in Real Estate from New York University.

Board of Directors

Eric Edidin, 49 [Resigned]
Director

Mr. Edidin is the co-founder and, since 2020, the Co-Chief Executive Officer of Council Advisors Capital, an investment partnership. As the Executive Chairman of BH3 Management, Mr. Edidin is responsible for overseeing the implementation and execution of BH3’s institutional products. Mr. Edidin serves as a board member of Spartacus Acquisition Corporation. Mr. Edidin was Co-Founder and, from 2006 to 2019, Co-Managing Partner of Archer Capital Management, an investment partnership with peak assets under management of $1.4 billion, which invested in more than 45 blank check companies and numerous commercial real estate related loans, assets, REITs and operating companies. At Archer Capital Management, Mr. Edidin was involved in the formation of the predecessor firm to BH3 Management and has partnered on numerous investment projects with both BH3 Management and its predecessor. From 2001 to 2006, Mr. Edidin was a Portfolio Manager and Co-Head of Credit Investments at York Capital Management. Mr. Edidin also previously held an investment related position at Morgan Stanley Capital Partners and a restructuring advisory position at The Blackstone Group. Throughout his career, Mr. Edidin has served as a board member and credit committee member of numerous companies. Mr. Edidin serves on the board and audit committee of Spartacus Acquisition Corporation (NASDQ: TMTS) and the boards of several other private companies, as well as the investment committee of the Jewish Communal Fund of New York and the Jewish Federation of Los Angeles. Mr. Edidin holds a Bachelor’s Degree in Business Administration from the University of Michigan and a Master’s Degree in Business Administration from Harvard Business School.

Daniel Adan, 38 [Resigned]
Director Nominee

Mr. Adan has been a Partner of Halmos Capital, a boutique private equity firm, which he co-founded, since 2018. At Halmos, Mr. Adan leads functions related to sourcing, underwriting, negotiating, closing and managing control transactions in operating companies in various industries. Mr. Adan has significant experience investing in both private and public companies across a variety of industries including notable investments in the real estate and out-of-home advertising sectors. Prior to Halmos, from 2016 to 2018 Mr. Adan was Director of Research of the Fundamental Strategies group at Magnetar Capital, a multi-strategy hedge fund with over $13 billion of assets under management. Prior to Magnetar, from 2007 to 2016, Mr. Adan was a portfolio manager and Managing Director at Perry Capital, a multi-strategy hedge fund with over $10 billion of assets under management, where he was responsible for a variety of asset classes and strategies. Mr. Adan began his career in 2005 within the Investment Banking Division at Goldman Sachs & Co., where he advised corporate management teams within the Industrials, Business Services and Energy sectors. Mr. Adan holds a Bachelor’s Degree in Finance from the Warrington College of Business at the University of Florida. He sits on the Board of Directors at KIPP NJ and KIPP Miami where he chairs the Finance Committee.

Dwight “Arne” Arnesen, 65 [Resigned]
Director Nominee

Mr. Arnesen retired as Senior Managing Director of Rockwood Capital in 2020, where he served on various Investment and Portfolio Management Committees and led the firm’s East Coast acquisitions efforts. Among other responsibilities, for over 10 years he oversaw the selection of projects and local operators as well as the negotiation and structuring of transactions. Previously, Mr. Arnesen held senior roles in both acquisitions and asset management as Managing Director of Acquisitions in North America and Head of Asset Management for JER Partners and JER’s European funds. Prior to JER, Mr. Arnesen was a Managing Director and co-head of U.S. acquisitions at Starwood Capital Group Global LLC, sitting on the firm’s various investment committees. Before joining Starwood, Mr. Arnesen was a Principal at JPMorgan Partners (formerly known as Chase Capital Partners), where he started the firm’s real estate practice. Prior to his tenure at JP Morgan Partners, Mr Arnesen was a senior officer in the real estate workout group of Chemical Bank/Chase Manhattan Bank for 11 years, where he worked on problem loans and non-performing assets. Mr. Arnesen started his career practicing law in 1980 before transitioning to real estate banking at Chemical Bank between 1981 and 1985. Mr. Arnesen is a member of the New York State Bar, the Urban Land Institute, the International Council of Shopping Centers, and other professional organizations. He is a member of Business Executives for National Security, as well as a member of the Board of Directors of St Francis Hospital, Grenville Baker Boys and Girls Club and Rand Corporations’ Global Risk and Security group. Mr. Arnesen holds a Bachelor’s Degree in History, Economics and Business from Vanderbilt University (including a semester at University College, Oxford) and a Juris Doctorate from Washington and Lee University.

Jonathan Roth, 58 [Resigned]
Director Nominee

Mr. Roth is a Co-Founder and Managing Partner of 3650 REIT. Previously, Mr. Roth served as President of Canyon Partners Real Estate LLC, where he oversaw the management of Canyon Partners’ real estate investment arm. An expert in complex commercial, land, retail, office, hospitality, condominium and multifamily transactions and portfolios, Mr. Roth directly led the acquisition and origination teams for Canyon Partners and served on the investment committees for many of the Canyon Partners platforms. Prior to joining Canyon Partners, Mr. Roth was a Partner at the international law firm of Loeb & Loeb and specialized in all aspects of real estate transactions. Mr. Roth has served on multiple philanthropic boards and works with several leading medical institutions including the USC Center for Applied Molecular Medicine, UCLA Medical Center and Cedars Sinai Hospital. Mr. Roth currently sits on the Board of Governors for Cedars Sinai Hospital and the Ronald Reagan Medical Center Board. Mr. Roth currently serves as director of Pier House Capital, Inc. Mr. Roth holds a Bachelor’s Degree in English Literature from the University of California, Los Angeles and a Juris Doctorate from Loyola Law School.

Mark Rose, 57 [Resigned]
Director Nominee

Mr. Rose is Chief Executive Officer of Avison Young and Chair of the Board of Directors of Avison Young (Canada) Inc. He manages all strategic, financial, and operational activities of this full-service commercial real estate company, which provides solutions to real estate investors, owners and occupiers throughout the world. In his 11 years with Avison Young, Mr. Rose has overseen its growth from 290 real estate professionals in 11 offices in Canada to approximately 5,000 professionals in 100 offices around the world. Mr. Rose joined Avison Young after holding executive positions at two global publicly traded commercial real estate firms. He served as Chief Executive Officer of Grubb & Ellis Company (NYSE:GBE) from 2005-2008 and was previously Chief Operating Officer and Chief Financial Officer of the Americas for Jones Lang LaSalle (NYSE:JLL). Prior to his 12 years at Jones Lang LaSalle, he ran Metropolitan Realty Advisors, the brokerage and investment firm that he founded in 1993. Previously, he was Chair, Chief Executive and Chief Financial Officer of the U.S. Real Estate Investment Trust of British Coal Corporation Pension Funds. He currently serves on the Queens College Foundation’s Board of Trustees. Mr. Rose coaches developing leaders throughout the industry, including through the NAIOP Greater Toronto Chapter Mentorship Program. He has also served on the board of directors of LiquidSpace (from April 2016 to March 2020) and as a board member of Chicago Shakespeare Theater, Chicago Botanic Garden, and the real estate advisory board of the University of Miami (FL) Business School. Mr. Rose holds a Bachelor’s Degree in Accounting from Queens College.

 

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