Yellowstone Acquisition Company (YSACU) and Sky Harbour Announce Up to $70M Forward-Purchase Agreement in Connection With Proposed Merger

January 18, 2022 9:09 AM EST

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Sky Harbour LLC (“Sky”), which aims to address the shortage of private aviation hangars in many areas across the country by establishing a network of turnkey upscale business aviation hangar complexes, and Yellowstone Acquisition Company (NYSE: YSAC, YSACU, YSACW), a publicly-traded special purpose acquisition company, today announced that in connection with their proposed business combination (the “Business Combination”), Yellowstone has entered into a forward purchase agreement for up to $70 million with an affiliate of Atalaya Capital Management LP (“Atalaya”), a privately held, SEC-registered alternative investment advisory firm that focuses primarily on private credit and special opportunities investments.

On January 17, 2022, Yellowstone and ACM ARRT VII E LLC (“Seller”), entered into an agreement (the “FPA”) for an Equity Prepaid Forward Transaction (the “FP Transaction”). Pursuant to the terms of the FPA, (a) Seller intends, but is not obligated, to purchase shares (the “Subject Shares”) of Class A common stock of the Company (the “Shares”) after the date of the FPA from holders of Shares (other than the Company, Boston Omaha Corporation or their affiliates) who have redeemed Shares or indicated an interest in redeeming Shares pursuant to the redemption rights set forth in the Company’s charter in connection with the Business Combination and (b) Seller has agreed to waive all redemption rights with respect to any Subject Shares in connection with the Business Combination so long as the FPA and the Equity Purchase Agreement are not terminated prior to the closing of the Business Combination and the closing of the Business Combination occurs prior to the Outside Closing Date (as defined in the Equity Purchase Agreement). The number of Subject Shares shall be no more than the lesser of (i) 7,000,000 and (ii) the maximum number of Shares such that Seller does not beneficially own greater than 9.9% of the Shares on a post-combination pro forma basis. If the Seller acquires less than 2,500,000 Subject Shares, it has agreed to acquire additional Shares (“Additional Shares”) from the Company in a private placement which will be subject to the FPA such that the sum of the number of Additional Shares and the number of Subject Shares will be equal to 2,500,000.

The FPA provides that (a) one local business day following the closing of the Business Combination, the Company will pay to Seller, out of the funds held in the Company’s trust account, an amount (the “Prepayment Amount”) equal to the Redemption Price (as defined in Yellowstone’s Amended and Restated Certificate of Incorporation of the Company (the “ Certificate of Incorporation”) per Share (the “Initial Price”) multiplied by the aggregate number of Subject Shares and Additional Shares, if any, (together, the “Number of Shares”) on the date of such prepayment, (b) on the first local business day of each calendar quarter after the closing of the Business Combination, the Company will pay to Midtown Madison Management LLC a structuring fee in the amount of $2,500 per quarter and (c) on the date occurring one settlement cycle following the valuation date (which shall occur on the earlier of (i) 18 months after the closing of the Business Combination and (ii) the date specified by Seller in a written notice (not earlier than the day such notice is effective) that, during any 30 consecutive scheduled trading day-period following the closing of the Business Combination, the volume weighted average trading price per Share for 20 scheduled trading days during such period shall have been equal to or less than $5.00 per Share), the Seller shall deliver to the Company the Number of Shares less any Terminated Shares, as described below.

From time to time and on any scheduled trading day after the closing of the Business Combination, Seller may sell Subject Shares or Additional Shares (or any other shares of common stock or other securities of the Company) at its absolute discretion in one or more transactions, publicly or privately, and, in connection with such sales, terminate the FP Transaction in whole or in part in an amount corresponding to the number of Subject Shares or Additional Shares sold (the “Terminated Shares”). At the end of each calendar month during which any such early termination occurs, Seller will pay to the Company an amount equal to the product of (x) the number of shares terminated during such calendar month and (y) the Reset Price, where “Reset Price” refers to, initially, the Initial Price, provided that upon the closing of any follow-on offering of Shares registered under the Securities Act of 1933, as amended, at a price per Share that is lower than the then current Reset Price, the Reset Price will be reduced to equal such price per Share. Seller’s obligations to the Company under the FPA are secured by perfected liens on (i) the cash proceeds of any sale, transfer or other disposition of the Subject Shares, (ii) the deposit account (the “Deposit Account”) into which such cash proceeds (subject to certain carve-outs) are required to be deposited and (iii) proceeds and products of the foregoing. The Deposit Account will be subject to a customary deposit account control agreement in favor of the Company.



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