Thread by @BillAckman

I just posted a PSTH update letter on our website. pstontine.com/wp-content/upl…. I welcome your feedback.

To clarify, if we are successful in getting SPARC approved, PSTH shares will receive $20 per share in cash plus the market value of a SPARC warrant, which should represent the option value of investing in our next IBC at SPARC’s cash NAV.

Distributable Warrant (DW) holders will receive a warrant on identical terms in SPARC. Same five-year term, same strike at 15% premium to NAV to allow DW holders to participate in the SPARC merger on same terms as PSTH.

The goal of SPARC is to eliminate PSTH’s opportunity cost of capital for shareholders by enabling the return of cash in trust while preserving the option value of investing in our next deal at cost. DW holders also maintain their optionality.

Based on the closing price of PSTH, investors are assigning no option value today because of the litigation and limited time remaining for us to do a deal. The approval of SPARC extends the option value for a long duration and returns cash in trust until a deal is ready to close.

SPARC warrants should reflect that long duration and the option value of our ability to complete a new transaction on attractive terms in a better designed vehicle.

I welcome your views on how SPARC warrants should be valued.

If you find yourself in a leaky boat, often times you are better off switching boats than patching leaks to complete the mission

For clarity: If SPARC is approved, we will issue 200m SPARC warrants with a $20 exercise price and 22.22 m Distributable Warrants with a $23 exercise price and a five-year term from the time of the IBC. This will replicate PSTH’s capital structure at the time of exercise.