ITEM
1. BUSINESS.
Introduction
We
are a blank check company incorporated on February 18, 2021 as a Delaware corporation formed for the purpose of effecting a merger,
capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.
We have neither engaged in any operations nor generated any revenue to date. Based on our business activities, the Company is
a “shell company” as defined under the Exchange Act of 1934 (the “Exchange Act”) because we have no operations
and nominal assets consisting almost entirely of cash.
On
June 15, 2021, we consummated our initial public offering (the “Public Offering”) of 34,089,611 units, including the
issuance of 4,089,611 units as a result of the underwriters’ exercise in part of their over-allotment option. Each unit
consists of one share of Class A common stock and one-third of one redeemable warrant (“Public Warrant”). Each whole
warrant entitles the holder thereof to purchase one share of Class A common stock at a price of $11.50 per share. The units were
sold at an offering price of $10.00 per unit, generating gross proceeds, before expenses, of $340,896,110.
Prior
to the consummation of the Public Offering, on February 18, 2021, 1P subscribed for 11,500,000 shares of Class B common stock
(the “Founder Shares”) par value $0.0001 per share for a total subscription price of $25,000, and fully paid for these
on February 18, 2021. In March 2021, 1P transferred an aggregate of 1,150,000 Founder Shares to Horn LIT Holdings, LLC (“Horn”)
and 125,000 Founder Shares to each of Messrs. Clarke, Sidler and Sultemeier, resulting in 1P holding 9,975,000 Founder Shares.
On March 31, 2021, 1P and Horn surrendered 1,288,904 and 148,596 Founder Shares, respectively, to us for cancellation for no consideration
resulting in 1P and Horn holding 8,686,096 and 1,001,404 Founder Shares, respectively. On May 13, 2021, Horn transferred 1,001,404
Founder Shares to AG LIT. On June 10, 2021 1P and AG LIT surrendered 1,288,905 and 148,595 Founder Shares, respectively, to us
for no consideration resulting in 1P and AG LIT holding 7,397,191 and 852,809 Founder Shares, respectively. Of the 8,625,000 shares
of Class B common stock outstanding, an aggregate of 1,125,000 shares were subject to forfeiture to the extent that the underwriter’s
over-allotment option was not exercised in full. The forfeiture would be adjusted to the extent that the over-allotment option
was not exercised in full by the underwriters so that the Founder Shares would represent 20.0% of the Company’s issued and
outstanding shares after the IPO. On June 15, 2021 the underwriter’s over-allotment option was partially exercised. As of
June 15, 2021, there were 8,625,000 shares of Class B common stock issued and outstanding, 102,597 of which were subject to forfeiture.
On July 26, 2021, such remaining Founder Shares were forfeited.
Simultaneously
with the consummation of the Public Offering, we consummated the private placement of an aggregate of 5,945,281 Private Placement
Warrants, each exercisable to purchase one share of Class A common stock at $11.50 per share, to the Sponsors at a price of $1.50
per warrant, generating gross proceeds, before expenses, of $8,917,922 (the “Private Placement”). The warrants sold
in the Private Placement (the “Private Placement Warrants”) are identical to the warrants included in the units sold
in the Public Offering, except that, so long as they are held by their initial purchasers or their permitted transferees, (i)
they will not be redeemable by the Company, (ii) they (including the shares of Class A common stock issuable upon exercise of
these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold until 30 days after the Company
completes its initial business combination and (iii) they may be exercised by the holders on a cashless basis.
Upon
the closing of the Public Offering and the Private Placement, $340,896,110 was placed in a trust account with Continental Stock
Transfer & Trust Company acting as trustee (the “Trust Account”). Except for the withdrawal of interest to pay
taxes, our amended and restated certificate of incorporation (the “Charter”) provides that none of the funds held
in trust will be released from the Trust Account until the earlier of (i) the completion of our initial business combination;
(ii) the redemption of any of the shares of Class A common stock sold as part of the units sold in our Public Offering (“Public
Shares”) properly submitted in connection with a stockholder vote to amend the Charter to modify the substance or timing
of our obligation to redeem 100% of the Public Shares if we do not complete an initial business combination by June 15, 2023 or
with respect to any other material provisions relating to stockholders’ rights or pre-initial business combination activity
or (iii) the redemption of 100% of the Public Shares if we are unable to complete an initial business combination by June 15,
2023. The proceeds held in the Trust Account may only be invested in direct United States government treasury obligations within
the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”),
having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the
Investment Company Act which invest only in direct U.S. government treasury obligations.
After the payment of underwriting
discounts (excluding the deferred portion of $11,931,364 in underwriting commissions, which amount will be payable upon consummation of
our initial business combination if consummated) and $6,929,364 in expenses relating to the Public Offering, $2,427,771 of the net proceeds
of the Public Offering and Private Placement was not deposited into the Trust Account and was retained by us for working capital purposes.
The net proceeds deposited into the Trust Account remain on deposit in the Trust Account earning interest. As of December 31, 2021, there
was $340,908,415 in investments and cash held in the Trust Account and $967,124 of cash held outside the Trust Account and $1,196,779
available for working capital purposes.
Effecting
Our Initial Business Combination
General
We
are not presently engaged in, and we will not engage in, any operations for an indefinite period of time. We intend to effectuate
our initial business combination using cash held in the Trust Account, our equity, debt or a combination of these as the consideration
to be paid in our initial business combination. We may seek to complete our initial business combination with a company or business
that may be financially unstable or in its early stages of development or growth, which would subject us to the numerous risks
inherent in such companies and businesses.
If
our initial business combination is paid for using equity or debt securities, or not all of the funds released from the Trust
Account are used for payment of the consideration in connection with our initial business combination or used for redemptions
of our shares of Class A common stock, we may apply the balance of the cash released to us from the Trust Account for general
corporate purposes, including for maintenance or expansion of operations of the post-transaction company, the payment of principal
or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies
or for working capital.
Selection
of Target Businesses
While
we may pursue an initial business combination with a company in any sector or geography, we intend to focus our search on businesses
serving the senior market or capable of being repositioned to do so. Our Charter prohibits us from effectuating an initial business
combination with another blank check company or similar company with nominal operations.
In
accordance with Nasdaq listing rules, our initial business combination must occur with one or more target businesses that together
have an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding the deferred underwriting
commissions and taxes payable on the interest earned on the Trust Account) at the time of signing the agreement to enter into
the initial business combination. We refer to this as the 80% of fair market value test. The fair market value of the target or
targets will be determined by our Board based upon one or more standards generally accepted by the financial community (such as
actual and potential sales, earnings, cash flow and/or book value). Even though our Board will rely on generally accepted standards,
our Board will have discretion to select the standards employed. In addition, the application of the standards generally involves
a substantial degree of judgement. Accordingly, investors will be relying on the business judgment of the board of directors in
evaluating the fair market value of the target or targets. The proxy solicitation materials or tender offer documents used by
us in connection with any proposed transaction will provide public stockholders with our analysis of our satisfaction of the 80%
of fair market value test, as well as the basis for our determinations. If our Board is not able to independently determine the
fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm
that is a member of the Financial Industry Regulatory Authority (“FINRA”) or an independent valuation or appraisal
firm with respect to satisfaction of such criteria. If our Board is not able to independently determine the fair market value
of the target business or businesses, or if we are considering an initial business combination with an affiliated entity, we will
obtain an opinion with respect to the satisfaction of such criteria from an independent investment bank or an independent valuation
or accounting firm. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business
combination. Subject to this stipulation, our management will have virtually unrestricted flexibility in identifying and selecting
one or more prospective businesses, although we will not be permitted to effectuate our initial business combination with another
blank check company or a similar company with nominal operations.
We anticipate
structuring our initial business combination so that the post-transaction company in which our public stockholders that own shares
will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our
initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of
the target business, in order to meet certain objectives of the prior owners of the target business, the target management team or
stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or
acquires 50% or more of the outstanding voting securities of the target, or otherwise acquires a controlling interest in the target
sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the
post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business
combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target
and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of
new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling
interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately
prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial
business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired
by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for
purposes of the 80% of fair market value test. If the business combination involves more than one target business, the 80% of fair
market value test will be based on the aggregate value of all of the target businesses and we will treat the target businesses
together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable.
To
the extent we effect our initial business combination with a company or companies that may be financially unstable or in early
stages of development or growth, we may be affected by numerous risks inherent in such a situation. Although our management will
endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain
or assess all significant risk factors.
We
will craft a priority list of companies based on the acquisition criteria above. These companies will primarily be sourced through
our management team’s long-standing, extensive network of industry executives, investment firms, consultants, and intermediaries.
In
evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things,
meetings with management, document reviews, primary research, policy research, on-site visits, and a review of financial and other
information about the target and its industry. We will lean heavily upon the decades of our management team’s experience
conducting diligence on a broad set of private and publicly held healthcare companies. We expect this experience to allow our
management to quickly focus on the key, material investment drivers and reach the most insightful experts for the issue(s) at
hand.
The
time required to select and evaluate a target business and to structure and complete our initial business combination, and the
costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect
to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately
completed will result in our incurring losses and will reduce the funds we can use to complete another business combination.
Permitted
Purchases of Our Securities
If
we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
business combination pursuant to the tender offer rules, our initial stockholders, directors, officers, advisors or their respective
affiliates may purchase shares or Public Warrants in privately negotiated transactions or in the open market either prior to or
following the completion of our initial business combination. There is no limit on the number of shares our initial stockholders,
directors, officers, advisors or their respective affiliates may purchase in such transactions, subject to compliance with applicable
law and Nasdaq rules. However, they have no current commitments, plans or intentions to engage in such transactions and have not
formulated any terms or conditions for any such transactions. None of the funds in the Trust Account will be used to purchase
shares or Public Warrants in such transactions. If they engage in such transactions, they will be restricted from making any such
purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases
are prohibited by Regulation M under the Exchange Act.
In
the event that our initial stockholders, directors, officers, advisors or their respective affiliates purchase shares in privately
negotiated transactions from public stockholders who have already elected to exercise their redemption rights, such selling stockholders
would be required to revoke their prior elections to redeem their shares. We do not currently anticipate that such purchases,
if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction
subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases
that the purchases are subject to such rules, the purchasers will comply with such rules.
The
purpose of any such purchases of shares could be to (i) vote such shares in favor of the business combination and thereby increase
the likelihood of obtaining stockholder approval of the business combination or (ii) to satisfy a closing condition in an agreement
with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business
combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of Public Warrants
could be to reduce the number of Public Warrants outstanding or to vote such warrants on any matters submitted to the warrant
holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the
completion of our initial business combination that may not otherwise have been possible.
In
addition, if such purchases are made, the public “float” of our Class A common stock or Public Warrants may be reduced
and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation,
listing or trading of our securities on a national securities exchange.
Our
initial stockholders, officers, directors and/or their respective affiliates anticipate that they may identify the stockholders
with whom our initial stockholders, officers, directors or their respective affiliates may pursue privately negotiated purchases
by either the stockholders contacting us directly or by our receipt of redemption requests submitted by stockholders (in the case
of Class A common stock) following our mailing of proxy materials in connection with our initial business combination. To the
extent that our Sponsors, officers, directors, advisors or their respective affiliates enter into a private purchase, they would
identify and contact only potential selling stockholders who have expressed their election to redeem their shares for a pro rata
share of the Trust Account or vote against our initial business combination, whether or not such stockholder has already submitted
a proxy with respect to our initial business combination but only if such shares have not already been voted at the stockholder
meeting related to our initial business combination. Our Sponsors, officers, directors, advisors or any of their respective affiliates
will select which stockholders to purchase shares from based on a negotiated price and number of shares and any other factors
that they may deem relevant and will only purchase shares if such purchases comply with Regulation M under the Exchange Act and
the other federal securities laws. Our Sponsors, officers, directors and/or their respective affiliates will be restricted from
making purchases of shares if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. We expect any such
purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchases are subject
to such reporting requirements.
Redemption
Rights for Public Stockholders upon Completion of Our Initial Business Combination
We
will provide our public stockholders with the opportunity to redeem all or a portion of their Public Shares upon the completion
of our initial business combination at a per share price, payable in cash, equal to the aggregate amount then on deposit in the
Trust Account calculated as of two business days prior to the consummation of our initial business combination, including interest
earned on the funds held in the Trust Account and not previously released to us to pay our taxes, divided by the number of then
outstanding Public Shares, subject to the limitations and on the conditions described herein. The amount in the Trust Account
is initially anticipated to be $10.00 per public share. The per share amount we will distribute to investors who properly redeem
their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. There will be no redemption
rights upon the completion of our initial business combination with respect to our warrants. Our initial stockholders, officers
and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights
with respect to any Founder Shares they hold and any Public Shares they may acquire during or after the Public Offering in connection
with the completion of our initial business combination.
Limitations
on Redemptions
Our
Charter provides that in no event will we redeem our Public Shares in an amount that would cause our net tangible assets to be
less than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for: (i) cash
consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii)
the retention of cash to satisfy other conditions. In the event the aggregate cash consideration we would be required to pay for
all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions
pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will
not complete the initial business combination or redeem any shares in connection with such initial business combination, and all
shares of Class A common stock submitted for redemption will be returned to the holders thereof. We may, however, raise funds
through the issuance of equity-linked securities or through loans, advances or other indebtedness in connection with our initial
business combination, including pursuant to forward purchase agreements or backstop arrangements we may enter into following consummation
of the Public Offering, in order to, among other reasons, satisfy such net tangible assets or minimum cash requirements.
Manner
of Conducting Redemptions
We
will provide our public stockholders with the opportunity to redeem all or a portion of their Public Shares upon the completion
of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial business
combination or (ii) without a stockholder vote by means of a tender offer. The decision as to whether we will seek stockholder
approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and
will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require
us to seek stockholder approval under applicable law or stock exchange listing requirements. Asset acquisitions and stock purchases
would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions
where we issue more than 20% of our outstanding common stock or seek to amend our Charter would require stockholder approval.
So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq’s stockholder
approval rules.
The
requirement that we provide our public stockholders with the opportunity to redeem their Public Shares by one of the two methods
listed above will be contained in provisions of our Charter and will apply whether or not we maintain our registration under the
Exchange Act or our listing on Nasdaq. Such provisions may be amended if approved by holders of 65% of our common stock entitled
to vote thereon.
If
we provide our public stockholders with the opportunity to redeem their Public Shares in connection with a stockholder meeting,
we will:
| ● | conduct
the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation
of proxies, and not pursuant to the tender offer rules, and |
| ● | file
proxy materials with the SEC. |
If
we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of
common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders
present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power
of all outstanding shares of capital stock of the company entitled to vote at such meeting. Our initial stockholders will count
towards this quorum and, pursuant to the letter agreement, our Sponsors, officers and directors have agreed to vote any Founder
Shares they hold and any Public Shares purchased during or after the Public Offering (including in open market and privately-negotiated
transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding
shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum
is obtained. As a result, in addition to our initial stockholders’ Founder Shares, we would need only 12,783,605, or 37.5%
(assuming all issued and outstanding shares are voted), or 2,130,601, or 6.25% (assuming only the minimum number of shares representing
a quorum are voted), of the 34,089,611 Public Shares sold in the Public Offering to be voted in favor of an initial business combination
in order to have our initial business combination approved. These quorums and voting thresholds, and the voting agreements of
our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder
may elect to redeem its Public Shares irrespective of whether they vote for or against the proposed transaction or whether they
were a stockholder on the record date for the stockholder meeting held to approve the proposed transaction.
If
a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other reasons, we will:
| ● | conduct
the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and |
| ● | file
tender offer documents with the SEC prior to completing our initial business combination, which contain substantially the same financial
and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange
Act, which regulates the solicitation of proxies. |
In
the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business
days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination
until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not
tendering more than a specified number of Public Shares, which number will be based on the requirement that we may not redeem
Public Shares in an amount that would cause our net tangible assets to be less than $5,000,001. If public stockholders tender
more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination.
Upon
the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules,
we or our Sponsors will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common
stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act.
We
intend to require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold
their shares in “street name,” to, at the holder’s option, either deliver their stock certificates to our transfer
agent or deliver their shares to our transfer agent electronically using The Depository Trust Company’s DWAC (Deposit/Withdrawal
At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case
of proxy materials, this date may be up to two business days prior to the date on which the vote on the proposal to approve the
initial business combination is to be held. In addition, if we conduct redemptions in connection with a stockholder vote, we intend
to require a public stockholder seeking redemption of its Public Shares to also submit a written request for redemption to our
transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is included. The proxy
materials or tender offer documents, as applicable, that we will furnish to holders of our Public Shares in connection with our
initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements.
We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication
or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost.
If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly
return any certificates or shares delivered by public stockholders who elected to redeem their shares.
Our
Charter provides that in no event will we redeem our Public Shares in an amount that would cause our net tangible assets to be
less than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for: (i) cash
consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii)
the retention of cash to satisfy other conditions. In the event the aggregate cash consideration we would be required to pay for
all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions
pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will
not complete the initial business combination or redeem any shares in connection with such initial business combination, and all
shares of Class A common stock submitted for redemption will be returned to the holders thereof. We may, however, raise funds
through the issuance of equity-linked securities or through loans, advances or other indebtedness in connection with our initial
business combination, including pursuant to forward purchase agreements or backstop arrangements we may enter into following consummation
of the Public Offering, in order to, among other reasons, satisfy such net tangible assets or minimum cash requirements.
Limitation
on Redemption Upon Completion of Our Initial Business Combination If We Seek Stockholder Approval
If
we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
business combination pursuant to the tender offer rules, our Charter provides that a public stockholder, together with any affiliate
of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined
under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to Excess Shares, without
our prior consent. We believe this restriction will discourage stockholders from accumulating large blocks of shares, and subsequent
attempts by such holders to use their ability to exercise their redemption rights against a proposed business combination as a
means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other
undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in the
Public Offering could threaten to exercise its redemption rights if such holder’s shares are not purchased by us, our Sponsors
or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders’
ability to redeem no more than 15% of the shares sold in the Public Offering without our prior consent, we believe we will limit
the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination,
particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum
net worth or a certain amount of cash.
However,
we would not be restricting our stockholders’ ability to vote all of their shares (including Excess Shares) for or against
our initial business combination.
Delivering
Stock Certificates in Connection with the Exercise of Redemption Rights
As
described above, we intend to require our public stockholders seeking to exercise their redemption rights, whether they are record
holders or hold their shares in “street name,” to, at the holder’s option, either deliver their stock certificates
to our transfer agent or deliver their shares to our transfer agent electronically using The Depository Trust Company’s
DWAC (Deposit/Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as
applicable. In the case of proxy materials, this date may be up to two business days prior to the date on which the vote on the
proposal to approve the initial business combination is to be held. In addition, if we conduct redemptions in connection with
a stockholder vote, we intend to require a public stockholder seeking redemption of its Public Shares to also submit a written
request for redemption to our transfer agent two business days prior to the vote in which the name of the beneficial owner of
such shares is included. The proxy materials or tender offer documents, as applicable, that we will furnish to holders of our
Public Shares in connection with our initial business combination will indicate whether we are requiring public stockholders to
satisfy such delivery requirements. Accordingly, a public stockholder would have up to two business days prior to the vote on
the initial business combination if we distribute proxy materials, or from the time we send out our tender offer materials until
the close of the tender offer period, as applicable, to submit or tender its shares if it wishes to seek to exercise its redemption
rights. In the event that a stockholder fails to comply with these or any other procedures disclosed in the proxy or tender offer
materials, as applicable, its shares may not be redeemed. Given the relatively short exercise period, it is advisable for stockholders
to use electronic delivery of their Public Shares.
There
is a nominal cost associated with the above-referenced process and the act of certificating the shares or delivering them through
the DWAC system. The transfer agent will typically charge the broker submitting or tendering shares a fee of approximately $80.00
and it would be up to the broker whether or not to pass this cost on to the redeeming holder. However, this fee would be incurred
regardless of whether or not we require holders seeking to exercise redemption rights to submit or tender their shares. The need
to deliver shares is a requirement of exercising redemption rights regardless of the timing of when such delivery must be effectuated.
Any
request to redeem such shares, once made, may be withdrawn at any time up to the date set forth in the proxy materials or tender
offer documents, as applicable. Furthermore, if a holder of a public share delivered its certificate in connection with an election
of redemption rights and subsequently decides prior to the applicable date not to elect to exercise such rights, such holder may
simply request that the transfer agent return the certificate (physically or electronically). It is anticipated that the funds
to be distributed to holders of our Public Shares electing to redeem their shares will be distributed promptly after the completion
of our initial business combination.
If
our initial business combination is not approved or completed for any reason, then our public stockholders who elected to exercise
their redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the Trust Account. In
such case, we will promptly return any certificates delivered by public holders who elected to redeem their shares.
If
our proposed initial business combination is not completed, we may continue to try to complete an initial business combination
with a different target until 24 months from the closing of the Public Offering.
Conduct
of Redemptions Pursuant to Tender Offer Rules
If
we conduct redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (the “SEC”),
we will, pursuant to our Charter: (a) conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which
regulate issuer tender offers; and (b) file tender offer documents with the SEC prior to completing our initial business combination
which contain substantially the same financial and other information about the initial business combination and the redemption
rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies.
Submission
of Our Initial Business Combination to a Stockholder Vote
In
the event that we seek stockholder approval of our initial business combination, we will distribute proxy materials and, in connection
therewith, provide our public stockholders with the redemption rights described above upon completion of the initial business
combination.
If
we seek shareholder approval, we will complete our initial business combination only if a majority of the outstanding shares of
common stock voted are voted in favor of the business combination. A quorum for such meeting will consist of the holders present
in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power of all
outstanding shares of capital stock of the company entitled to vote at such meeting. Our initial stockholders will count towards
this quorum and, pursuant to the letter agreement, our Sponsors, officers and directors have agreed to vote any Founder Shares
they hold and any Public Shares purchased during or after the Public Offering (including in open market and privately-negotiated
transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding
shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum
is obtained. As a result, in addition to our initial stockholders’ Founder Shares, we would need only 12,783,605, or 37.5%
(assuming all issued and outstanding shares are voted), or 2,130,601, or 6.25% (assuming only the minimum number of shares representing
a quorum are voted), of the 34,089,611 Public Shares sold in the Public Offering to be voted in favor of an initial business combination
in order to have our initial business combination approved. These quorum and voting thresholds, and the voting agreements of our
initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder
may elect to redeem its Public Shares irrespective of whether they vote for or against the proposed transaction or whether they
were a stockholder on the record date for the stockholder meeting held to approve the proposed transaction.
Redemption
of Public Shares and Liquidation If No Initial Business Combination
Our
Charter provides that we will have only 24 months from the closing of the Public Offering to complete our initial business combination
or during any Extension Period. If we are unable to complete our initial business combination within such time period, 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 the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit
in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to us to pay
our taxes (less up to $100,000 of interest to pay dissolution expenses), 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 liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to
the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject, in each case, to our obligations
under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption
rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial
business combination within the prescribed time period.
Our
initial stockholders, officers and directors have entered into a letter agreement with us, pursuant to which they have waived
their rights to liquidating distributions from the Trust Account with respect to their Founder Shares if we fail to complete our
initial business combination within 24 months from the closing of the Public Offering or during any Extension Period. However,
if our initial stockholders, officers or directors acquire Public Shares in or after the Public Offering, they will be entitled
to liquidating distributions from the Trust Account with respect to such Public Shares if we fail to complete our initial business
combination within the allotted time period.
The
underwriters have agreed to waive their rights to their deferred underwriting commission held in the Trust Account in the event
we do not complete our initial business combination and subsequently liquidate and, in such event, such amounts will be included
with the funds held in the Trust Account that will be available to fund the redemption of our Public Shares.
Our
initial stockholders, officers and directors have agreed, pursuant to a letter agreement with us, that they will not propose any
amendment to our Charter to modify the substance or timing of our obligation to allow redemption in connection with our initial
business combination or to redeem 100% of our Public Shares if we do not complete our initial business combination within 24 months
from the closing of the Public Offering or with respect to any other material provisions relating to stockholders’ rights
or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their Class
A common stock upon approval of any such amendment at a per share price, payable in cash, equal to the aggregate amount then on
deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to
us to pay our taxes, divided by the number of then outstanding Public Shares, subject to the limitations described above under
“Limitations on redemptions.” For example, our board of directors may propose such an amendment if it determines that
additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation
and distribute proxy materials pursuant to Regulation 14A of the Exchange Act seeking stockholder approval of such proposal, and
in connection therewith, provide our public stockholders with the redemption rights described above upon stockholder approval
of such amendment.
Competition
In
identifying, evaluating and selecting a target business for our business combination, we may encounter intense competition from
other entities having a business objective similar to ours, including private investors (which may be individuals or investment
partnerships), other blank check companies, and other entities, domestic and international, competing for the types of businesses
we intend to acquire. Many of these individuals and entities are well-established and have extensive experience in identifying
and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many
of these competitors possess similar or greater technical, human and other resources to ours or more local industry knowledge
than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While
we believe there are numerous target businesses we could potentially acquire with the net proceeds of the Public Offering and
the sale of the Private Placement Warrants, our ability to compete with respect to the acquisition of certain target businesses
that are sizable will be limited by our available financial resources. This inherent competitive limitation gives others an advantage
in pursuing the acquisition of certain target businesses. Furthermore, we are obligated to offer holders of our Public Shares
the right to redeem their shares for cash at the time of our initial business combination in conjunction with a stockholder vote
or via a tender offer. Target companies will be aware that this may reduce the resources available to us for our initial business
combination. Any of these obligations may place us at a competitive disadvantage in successfully negotiating an initial business
combination. If we are unable to complete our initial business combination, our public stockholders may receive only their pro
rata portion of the funds in the Trust Account that are available for distribution to public stockholders, and our warrants will
expire worthless.
Employees
We
currently have two executive officers: Alan Gershenhorn and Isaac Applbaum. These individuals are not obligated to devote any
specific number of hours to our matters but they intend to devote as much of their time as they deem necessary to our affairs
until we have completed our initial business combination. The amount of time they will devote in any time period will vary based
on whether a target business has been selected for our initial business combination and the stage of the business combination
process we are in. We do not intend to have any full time employees prior to the completion of our initial business combination.
Available
Information
We
are required to file Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q with the SEC on a regular basis, and are required
to disclose certain material events (e.g., changes in corporate control, acquisitions or dispositions of a significant amount
of assets other than in the ordinary course of business and bankruptcy) in a Current Report on Form 8-K. The SEC maintains an
Internet website that contains reports, proxy and information statements and other information regarding issuers that file electronically
with the SEC. The SEC’s Internet website is located at http://www.sec.gov. In addition, the Company will provide copies
of these documents without charge upon request from us in writing at 3348 Peachtree Road, Suite 700, Atlanta, GA 30326 or by telephone
at (678) 954-4822.
ITEM
1A. RISK FACTORS.
RISK
FACTORS
An
investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together
with the other information contained in this Annual Report on Form 10-K and the prospectus associated with our Public Offering,
before making a decision to invest in our securities. If any of the following events occur, our business, financial condition
and operating results may be materially adversely affected. In that event, the trading price of our securities could decline,
and you could lose all or part of your investment.
RISKS
RELATING TO OUR SEARCH FOR, AND CONSUMMATION OF OR
INABILITY TO CONSUMMATE, A BUSINESS COMBINATION
Our
stockholders may not be afforded an opportunity to vote on our proposed initial business combination, and even if we hold a vote,
holders of our Founder Shares will participate in such vote, which means we may complete our initial business combination even
though a majority of our public stockholders do not support such a combination.
We
may choose not to hold a stockholder vote to approve our initial business combination if the business combination would not require
stockholder approval under applicable law or stock exchange listing requirement. Except for as required by applicable law or stock
exchange requirement, the decision as to whether we will seek stockholder approval of a proposed business combination or will
allow stockholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based
on a variety of factors, such as the timing of the transaction and whether the terms of the transaction would otherwise require
us to seek stockholder approval. Even if we seek stockholder approval, the holders of our Founder Shares will participate in the
vote on such approval. Accordingly, we may complete our initial business combination even if a majority of our public stockholders
do not approve of the business combination we complete.
If
we seek stockholder approval of our initial business combination, our initial stockholders and management team have agreed to
vote in favor of such initial business combination, regardless of how our public stockholders vote.
Our
initial stockholders own 20% of our outstanding common stock immediately following the completion of the Public Offering. Our
initial stockholders and management team also may from time to time purchase Class A common stock prior to our initial business
combination. Our Charter provides that, if we seek stockholder approval of an initial business combination, such initial business
combination will be approved if we receive the affirmative vote of a majority of the shares voted at such meeting, including the
Founder Shares. As a result, in addition to our initial stockholders’ Founder Shares, we would need 12,783,605, or 37.5%
(assuming all issued and outstanding shares are voted), 2,130,601, or 6.25% (assuming only the minimum number of shares representing
a quorum are voted), of the 34,089,611 Public Shares sold in the Public Offering to be voted in favor of an initial business combination
in order to have our initial business combination approved. Accordingly, if we seek stockholder approval of our initial business
combination, the agreement by our initial stockholders and management team to vote in favor of our initial business combination
will increase the likelihood that we will receive the requisite stockholder approval for such initial business combination.
Your
only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of
your right to redeem your shares from us for cash.
At
the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of our
initial business combination. Since our board of directors may complete a business combination without seeking stockholder approval,
public stockholders may not have the right or opportunity to vote on the business combination, unless we seek such stockholder
vote. Accordingly, your only opportunity to affect the investment decision regarding our initial business combination may be limited
to exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in our tender
offer documents mailed to our public stockholders in which we describe our initial business combination.
The
ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential
business combination targets, which may make it difficult for us to enter into a business combination with a target.
We
may seek to enter into a business combination transaction agreement with minimum cash requirement for (i) cash consideration to
be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention
of cash to satisfy other conditions. If too many public stockholders exercise their redemption rights, we would not be able to
meet such closing condition and, as a result, would not be able to proceed with the business combination. Furthermore, in no event
will we redeem our Public Shares in an amount that would cause our net tangible assets to be less than $5,000,001. Consequently,
if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or make
us unable to satisfy a minimum cash condition as described above, we would not proceed with such redemption and the related business
combination and may instead search for an alternate business combination. Prospective targets will be aware of these risks and,
thus, may be reluctant to enter into a business combination transaction with us.
The
ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us
to complete the most desirable business combination or optimize our capital structure.
At
the time we enter into an agreement for our initial business combination, we will not know how many stockholders may exercise
their redemption rights, and therefore will need to structure the transaction based on our expectations as to the number of shares
that will be submitted for redemption. If our initial business combination agreement requires us to use a portion of the cash
in the Trust Account to pay the purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve
a portion of the cash in the Trust Account to meet such requirements, or arrange for third party financing. In addition, if a
larger number of shares is submitted for redemption than we initially expected, we may need to restructure the transaction to
reserve a greater portion of the cash in the Trust Account or arrange for third party financing. Raising additional third party
financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. Furthermore,
this dilution would increase to the extent that the anti-dilution provision of the Class B common stock results in the issues
of shares of Class A common stock on a greater than one-to-one basis upon conversion of the shares of Class B common stock at
the time of our initial business combination. In addition, the amount of the deferred underwriting commissions payable to the
underwriters will not be adjusted for any shares that are redeemed in connection with an initial business combination. The per
share amount we will distribute to stockholders who properly exercise their redemption rights will not be reduced by the deferred
underwriting commission and after such redemptions, the amount held in trust will continue to reflect our obligation to pay the
entire deferred underwriting commissions. The above considerations may limit our ability to complete the most desirable business
combination available to us or optimize our capital structure.
The
ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the
probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order
to redeem your shares.
If
our initial business combination agreement requires us to use a portion of the cash in the Trust Account to pay the purchase price,
or requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful
is increased. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the Trust Account
until we liquidate the Trust Account. If you are in need of immediate liquidity, you could attempt to sell your shares in the
open market; however, at such time our shares may trade at a discount to the pro rata amount per share in the Trust Account. In
either situation, you may suffer a material loss on your investment or lose the benefit of funds expected in connection with your
exercise of redemption rights until we liquidate or you are able to sell your shares in the open market.
Our
search for a business combination, and any target business with which we ultimately consummate a business combination, may be
materially adversely affected by the coronavirus (COVID-19) outbreak and the status of debt and equity markets.
In
December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, which has and is continuing to spread
throughout China and other parts of the world, including the United States. On January 30, 2020, the World Health Organization
declared the outbreak of the coronavirus disease (COVID-19) a “Public Health Emergency of International Concern.”
On January 31, 2020, U.S. Health and Human Services Secretary Alex M. Azar II declared a public health emergency for the United
States to aid the U.S. healthcare community in responding to COVID-19, and on March 11, 2020 the World Health Organization characterized
the outbreak as a “pandemic”. The COVID-19 outbreak has and a significant outbreak of other infectious diseases could
result in a widespread health crisis that could adversely affect the economies and financial markets worldwide, and the business
of any potential target business with which we consummate a business combination could be materially and adversely affected. Furthermore,
we may be unable to complete a business combination if continued concerns relating to COVID-19 continues to restrict travel, limit
the ability to have meetings with potential investors or the target company’s personnel, vendors and services providers
are unavailable to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search
for a business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new
information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among
others. If the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time, our
ability to consummate a business combination, or the operations of a target business with which we ultimately consummate a business
combination, may be materially adversely affected.
In
addition, our ability to consummate a transaction may be dependent on the ability to raise equity and debt financing which may
be impacted by COVID-19 and other events, including as a result of increased market volatility, decreased market liquidity in
third-party financing being unavailable on terms acceptable to us or at all.
The
requirement that we complete our initial business combination within 24 months after the closing of the Public Offering may give
potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to
conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which
could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders.
Any
potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete
our initial business combination within 24 months from the closing of the Public Offering. Consequently, such target business
may obtain leverage over us in negotiating a business combination, knowing that if we do not complete our initial business combination
with that particular target business, we may be unable to complete our initial business combination with any target business.
This risk will increase as we get closer to the timeframe described above. In addition, we may have limited time to conduct due
diligence and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.
We
may not be able to complete our initial business combination within 24 months after the closing of the Public Offering, in which
case we would cease all operations except for the purpose of winding up and we would redeem our Public Shares and liquidate.
We may not be able to find
a suitable target business and complete our initial business combination within 24 months after the closing of the Public Offering. Our
ability to complete our initial business combination may be negatively impacted by general market conditions, volatility in the capital
and debt markets and the other risks described herein. For example, the outbreak of COVID-19 continues to grow both in the U.S. and globally
and, while the extent of the impact of the outbreak on us will depend on future developments, it could limit our ability to complete our
initial business combination, including as a result of increased market volatility, decreased market liquidity and third-party financing
being unavailable on terms acceptable to us or at all. Additionally, the outbreak of COVID-19 may negatively impact businesses we may
seek to acquire. Also, the conflict between Ukraine and Russia continues to grow and, while the extent of the impact of the conflict on
us will depend on future developments, it could limit our ability to complete our initial business combination, including as a result
of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at
all. We may not be able to find a suitable target business and complete our initial business combination within such time period. If we
have not completed our initial business combination within such time period, 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 the Public Shares, at a
per share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the
funds held in the Trust Account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution
expenses), 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 liquidating distributions, if any), and (iii) as promptly as reasonably
possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve,
subject in each case, to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable
law.
If
we seek stockholder approval of our initial business combination, our initial stockholders, directors, executive officers, advisors
and their respective affiliates may elect to purchase shares or Public Warrants from public stockholders, which may influence
a vote on a proposed business combination and reduce the public “float” of our Class A common stock.
If
we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
business combination pursuant to the tender offer rules, our initial stockholders, directors, executive officers, advisors or
their respective affiliates may purchase shares or Public Warrants in privately negotiated transactions or in the open market
either prior to or following the completion of our initial business combination, although they are under no obligation to do so.
There is no limit on the number of shares our initial stockholders, directors, officers, advisors or their respective affiliates
may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, other than as expressly
stated herein, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any
terms or conditions for any such transactions. None of the funds in the Trust Account will be used to purchase shares or Public
Warrants in such transactions. Such purchases may include a contractual acknowledgment that such stockholder, although still the
record holder of our shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights.
In
the event that our initial stockholders, directors, executive officers, advisors or their respective affiliates purchase shares
in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights, such
selling stockholders would be required to revoke their prior elections to redeem their shares. The purpose of any such purchases
of shares could be to vote such shares in favor of the business combination and thereby increase the likelihood of obtaining stockholder
approval of the business combination or to satisfy a closing condition in an agreement with a target that requires us to have
a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such
requirement would otherwise not be met. The purpose of any such purchases of Public Warrants could be to reduce the number of
Public Warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection
with our initial business combination. Any such purchases of our securities may result in the completion of our initial business
combination that may not otherwise have been possible. We expect any such purchases will be reported pursuant to Section 13 and
Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.
In
addition, if such purchases are made, the public “float” of our Class A common stock or Public Warrants and the number
of beneficial holders of our securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing
or trading of our securities on a national securities exchange.
If
a stockholder fails to receive notice of our offer to redeem our Public Shares in connection with our initial business combination
or fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
We
will comply with the proxy rules or tender offer rules, as applicable, when conducting redemptions in connection with our initial
business combination. Despite our compliance with these rules, if a stockholder fails to receive our proxy materials or tender
offer documents, as applicable, such stockholder may not become aware of the opportunity to redeem its shares. In addition, proxy
materials or tender offer documents, as applicable, that we will furnish to holders of our Public Shares in connection with our
initial business combination will describe the various procedures that must be complied with in order to validly tender or submit
Public Shares for redemption. For example, we intend to require our public stockholders seeking to exercise their redemption rights,
whether they are record holders or hold their shares in “street name,” to, at the holder’s option, either deliver
their stock certificates to our transfer agent, or to deliver their shares to our transfer agent electronically prior to the date
set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up
to two business days prior to the date on which the vote on the proposal to approve the initial business combination is to be
held. In addition, if we conduct redemptions in connection with a stockholder vote, we intend to require a public stockholder
seeking redemption of its Public Shares to also submit a written request for redemption to our transfer agent two business days
prior to the vote in which the name of the beneficial owner of such shares is included.
In
the event that a stockholder fails to comply with these or any other procedures disclosed in the proxy or tender offer materials,
as applicable, its shares may not be redeemed.
You
will not be entitled to protections normally afforded to investors of many other blank check companies.
Since
the net proceeds of the Public Offering and the sale of the Private Placement Warrants are intended to be used to complete an
initial business combination with a target business that has not been selected, we may be deemed to be a “blank check”
company under the United States securities laws. However, because we will have net tangible assets in excess of $5,000,000 upon
the completion of the Public Offering and the sale of the Private Placement Warrants and will file a Current Report on Form 8-K,
including an audited balance sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors
in blank check companies, such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules.
Among other things, this means our units will be immediately tradable and we will have a longer period of time to complete our
initial business combination than do companies subject to Rule 419. Moreover, if the Public Offering were subject to Rule 419,
that rule would prohibit the release of any interest earned on funds held in the Trust Account to us unless and until the funds
in the Trust Account were released to us in connection with our completion of an initial business combination. For a more detailed
comparison of our offering to offerings that comply with Rule 419.
If
we seek stockholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer
rules, and if you or a “group” of stockholders are deemed to hold in excess of 15% of our Class A common stock, you
will lose the ability to redeem all such shares in excess of 15% of our Class A common stock.
If
we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
business combination pursuant to the tender offer rules, our Charter provides that a public stockholder, together with any affiliate
of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined
under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate
of 15% without our prior consent, which we refer to as the “Excess Shares.” However, we would not be restricting our
stockholders’ ability to vote all of their shares (including Excess Shares) for or against our initial business combination.
Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business combination
and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally,
you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination.
And as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would
be required to sell your shares in open market transactions, potentially at a loss.
Because
of our limited resources and the significant competition for business combination opportunities, it may be more difficult for
us to complete our initial business combination. If we are unable to complete our initial business combination, our public stockholders
may receive only their pro rata portion of the funds in the Trust Account that are available for distribution to public stockholders,
and our warrants will expire worthless.
We
expect to encounter competition from other entities having a business objective similar to ours, including private investors (which
may be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing
for the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive
experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services
to various industries. Many of these competitors possess similar or greater technical, human and other resources to ours or more
local industry knowledge than we do and our financial resources will be relatively limited when contrasted with those of many
of these competitors. While we believe there are numerous target businesses we could potentially acquire with the net proceeds
of the Public Offering and the sale of the Private Placement Warrants, our ability to compete with respect to the acquisition
of certain target businesses that are sizable will be limited by our available financial resources. This inherent competitive
limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, we are obligated to
offer holders of our Public Shares the right to redeem their shares for cash at the time of our initial business combination in
conjunction with a stockholder vote or via a tender offer. Target companies will be aware that this may reduce the resources available
to us for our initial business combination. Any of these obligations may place us at a competitive disadvantage in successfully
negotiating a business combination. If we are unable to complete our initial business combination, our public stockholders may
receive only their pro rata portion of the funds in the Trust Account that are available for distribution to public stockholders,
and our warrants will expire worthless.
If
the net proceeds of the Public Offering and the sale of the Private Placement Warrants not being held in the Trust Account are
insufficient to allow us to operate until at least June 15, 2023, we may be unable to complete our initial business combination,
in which case our public stockholders may only receive $10.00 per share, or less than such amount in certain circumstances, and
our warrants will expire worthless.
Of the net proceeds of the
Public Offering and the sale of the Private Placement Warrants, only $967,124 is available to us outside of the Trust Account as of December
31, 2021. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with
our search for a target business. We could also use a portion of the funds as a down payment or to fund a “no-shop” provision
(a provision in letters of intent or merger agreements designed to keep target businesses from “shopping” around for transactions
with other companies on terms more favorable to such target businesses) with respect to a particular proposed initial business combination
although we do not have any current intention to do so. If we entered into a letter of intent or merger agreement where we paid for the
right to receive exclusivity from a target business and were subsequently required to forfeit such funds (whether as a result of our breach
or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence with respect to, a target business.
If we are unable to complete an initial business combination, our public stockholders may receive only approximately $10.00 per share,
or less in certain circumstances, on the liquidation of our Trust Account and our warrants will expire worthless. In certain circumstances,
our public stockholders may receive less than $10.00 per share upon our liquidation. See “- If third parties bring claims against
us, the proceeds held in the Trust Account could be reduced and the per-share redemption amount received by stockholders may be less than
$10.00 per share” and other risk factors herein.
If
third parties bring claims against us, the proceeds held in the Trust Account could be reduced and the per-share redemption amount
received by stockholders may be less than $10.00 per share.
Our
placing of funds in the Trust Account may not protect those funds from third party claims against us. Although we will seek to
have all vendors, service providers (except for our independent registered public accounting firm), prospective target businesses
and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind
in or to any monies held in the Trust Account for the benefit of our public stockholders, such parties may not execute such agreements,
or even if they execute such agreements they may not be prevented from bringing claims against the Trust Account, including, but
not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging
the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including
the funds held in the Trust Account. If any third party refuses to execute an agreement waiving such claims to the monies held
in the Trust Account, our management will consider whether competitive alternatives are reasonably available to us and will only
enter into an agreement with such third party if management believes that such third party’s engagement would be in the
best interests of the company under the circumstances. The underwriters of the Public Offering as well as our registered independent
public accounting firm will not execute agreements with us waiving such claims to the monies held in the Trust Account.
Examples
of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party
consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants
that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver.
In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of,
or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the Trust Account for
any reason. Upon redemption of our Public Shares, if we are unable to complete our initial business combination within the prescribed
timeframe, or upon the exercise of a redemption right in connection with our initial business combination, we will be required
to provide for payment of claims of creditors that were not waived that may be brought against us within the 10 years following
redemption. Accordingly, the per-share redemption amount received by public stockholders could be less than the $10.00 per public
share initially held in the Trust Account, due to claims of such creditors. Pursuant to the letter agreement the form of which
is filed as an exhibit to the registration statement of which the prospectus forms a part, 1P has agreed that it will be liable
to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business
with which we have entered into a written letter of intent, confidentiality or other similar agreement or business combination
agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $10.00 per public share and (ii) the actual
amount per public share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.00
per public share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not
apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies
held in the Trust Account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the
underwriters of the Public Offering against certain liabilities, including liabilities under the Securities Act. However, we have
not asked 1P to reserve for such indemnification obligations, nor have we independently verified whether 1P has sufficient funds
to satisfy its indemnity obligations and we believe that 1P’s only assets are securities of our company. Therefore, we cannot
assure you that 1P would be able to satisfy those obligations. As a result, if any such claims were successfully made against
the Trust Account, the funds available for our initial business combination and redemptions could be reduced to less than $10.00
per public share. In such event, we may not be able to complete our initial business combination, and you would receive such lesser
amount per share in connection with any redemption of your Public Shares. None of our officers or directors will indemnify us
for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
Our
directors may decide not to enforce the indemnification obligations of 1P, resulting in a reduction in the amount of funds in
the Trust Account available for distribution to our public stockholders.
In
the event that the proceeds in the Trust Account are reduced below the lesser of (i) $10.00 per share and (ii) the actual amount
per public share held in the Trust Account as of the date of the liquidation of the Trust Account if less than $10.00 per public
share due to reductions in the value of the trust assets, in each case less taxes payable, and 1P 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 1P to enforce its indemnification obligations. While we currently expect
that our independent directors would take legal action on our behalf against 1P to enforce its indemnification obligations to
us, it is possible that our independent directors in exercising their business judgment and subject to their fiduciary duties
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.
If,
after we distribute the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members
of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members
of our board of directors and us to claims of punitive damages.
If,
after we distribute the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under
applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.”
As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. In addition, our board
of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, by paying
public stockholders from the Trust Account prior to addressing the claims of creditors, thereby exposing itself and us to claims
of punitive damages.
If,
before distributing the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over
the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with
our liquidation may be reduced.
If,
before distributing the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, the proceeds held in the Trust Account could be subject to applicable
bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the
claims of our stockholders. To the extent any bankruptcy claims deplete the Trust Account, the per-share amount that would otherwise
be received by our stockholders in connection with our liquidation may be reduced.
Our
warrants are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial
results.
On
April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the SEC together issued
a statement regarding the accounting and reporting considerations for warrants issued by special purpose acquisition companies
entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition
Companies (“SPACs”)” (the “SEC Staff Statement”). Specifically, the SEC Staff Statement focused
on certain settlement terms and provisions related to certain tender offers following a business combination, which terms are
deemed to be similar to those contained in the warrant agreement governing our warrants and those of other SPAC entities. As a
result of the SEC Staff Statement, we evaluated the accounting treatment of our Public Warrants and our Private Placement Warrants
and determined to classify the warrants as derivative liabilities measured at fair value, with changes in fair value each period
reported in earnings.
As
a result, now included on our balance sheet contained elsewhere in this Annual Report are derivative liabilities related to our
warrants. Accounting Standards Codification (“ASC”) Topic 815, “Derivatives and Hedging”, provides
for the remeasurement of the fair value of such derivatives at each balance sheet date, with a resulting non-cash gain or loss
related to the change in the fair value being recognized in earnings in the statement of operations in the period of change. As a
result of this recurring fair value measurement, our financial statements and results of operations may fluctuate quarterly, based
on factors which are outside of our control. Due to the recurring fair value measurement, we expect that we will recognize going
forward non-cash gains or losses on our warrants each reporting period until exercised and that the amount of such gains or losses
could be material.
If
we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance
requirements and our activities may be restricted, which may make it difficult for us to complete our initial business combination.
If
we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including:
| ● | restrictions
on the nature of our investments; and |
| ● | restrictions
on the issuance of securities, |
each
of which may make it difficult for us to complete our initial business combination. In addition, we may have imposed upon us burdensome
requirements, including:
| ● | registration
as an investment company with the SEC; |
| ● | adoption
of a specific form of corporate structure; and |
| ● | reporting,
record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are not subject to. |
In
order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we
must ensure that we are engaged primarily in a business other than investing, reinvesting or trading of securities and that our
activities do not include investing, reinvesting, owning, holding or trading “investment securities” constituting
more than 40% of our assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. Our business
will be to identify and complete a business combination and thereafter to operate the post-transaction business or assets for
the long term. We do not plan to buy businesses or assets with a view to resale or profit from their resale. We do not plan to
buy unrelated businesses or assets or to be a passive investor.
We
do not believe that our anticipated principal activities will subject us to the Investment Company Act. To this end, the proceeds
held in the Trust Account may only be invested in United States “government securities” within the meaning of Section
2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions
under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations.
Pursuant to the trust agreement, the trustee is not permitted to invest in other securities or assets. By restricting the investment
of the proceeds to these instruments, and by having a business plan targeted at acquiring and growing businesses for the long
term (rather than on buying and selling businesses in the manner of a merchant bank or private equity fund), we intend to avoid
being deemed an “investment company” within the meaning of the Investment Company Act. The Public Offering is not
intended for persons who are seeking a return on investments in government securities or investment securities. The Trust Account
is intended as a holding place for funds pending the earliest to occur of either: (i) the completion of our initial business combination;
(ii) the redemption of any Public Shares properly tendered in connection with a stockholder vote to amend our Charter to modify
the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem
100% of our Public Shares if we do not complete our initial business combination within 24 months from the closing of the Public
Offering; and (iii) absent an initial business combination within 24 months from the closing of the Public Offering or with respect
to any other material provisions relating to stockholders’ rights or pre-initial business combination activity, our return
of the funds held in the Trust Account to our public stockholders as part of our redemption of the Public Shares. If we do not
invest the proceeds as discussed above, we may be deemed to be subject to the Investment Company Act. If we were deemed to be
subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for
which we have not allotted funds and may hinder our ability to complete a business combination. If we are unable to complete our
initial business combination, our public stockholders may only receive their pro rata portion of the funds in the Trust Account
that are available for distribution to public stockholders, and our warrants will expire worthless.
Changes
in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our
ability to negotiate and complete our initial business combination, and results of operations.
We
are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to
comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may
be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from
time to time and those changes could have a material adverse effect on our business, investments and results of operations. In
addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect
on our business, including our ability to negotiate and complete our initial business combination, and results of operations.
If
we have not completed an initial business combination within 24 months from the closing of the Public Offering, our public stockholders
may be forced to wait beyond such 24 months before redemption from our Trust Account.
If
we have not completed an initial business combination within 24 months from the closing of the Public Offering, the proceeds then
on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released
to us to pay our taxes, if any (less up to $100,000 of the interest to pay dissolution expenses), will be used to fund the redemption
of our Public Shares, as further described herein. Any redemption of public stockholders from the Trust Account will be effected
automatically by function of our Charter prior to any voluntary winding up. If we are required to wind-up, liquidate the Trust
Account and distribute such amount therein, pro rata, to our public stockholders, as part of any liquidation process, such winding
up, liquidation and distribution must comply with the applicable provisions of the DGCL. In that case, investors may be forced
to wait beyond 24 months from the closing of the Public Offering before the redemption proceeds of our Trust Account become available
to them, and they receive the return of their pro rata portion of the proceeds from our Trust Account. We have no obligation to
return funds to investors prior to the date of our liquidation unless we complete our initial business combination or amend certain
material provisions of our Charter prior thereto and only then in cases where investors have sought to redeem their Class A common
stock. Only upon our redemption or any liquidation will public stockholders be entitled to distributions if we do not complete
our initial business combination.
Our
stockholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption
of their shares.
Under
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 our Public Shares in the event we do not complete our initial business combination within 24 months from the closing of the
Public Offering may be considered a liquidating distribution under Delaware law. If a 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, it is our intention to redeem our Public Shares as soon
as reasonably possible following the 24th month from the closing of the Public Offering in the event we do not complete
our initial business combination and, therefore, we do not intend to comply with the foregoing procedures.
Because
we will not be complying with Section 280, 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 10 years following our dissolution. 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. If our plan of distribution
complies with Section 281(b) of the DGCL, 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 likely be barred after the third anniversary of the dissolution. We cannot assure you that we will properly
assess all claims that may be potentially brought against us. As such, our stockholders could potentially be liable for any claims
to the extent of distributions received by them (but no more) and any liability of our stockholders may extend beyond the third
anniversary of such date. Furthermore, if the pro rata portion of our Trust Account distributed to our public stockholders upon
the redemption of our Public Shares in the event we do not complete our initial business combination within 24 months from the
closing of the Public Offering is not considered a liquidating distribution under Delaware law and such redemption distribution
is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring or due to other circumstances
that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could
then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.
We
may not hold an annual meeting of stockholders until after the consummation of our initial business combination, which could delay
the opportunity for our stockholders to elect directors.
In
accordance with Nasdaq’s corporate governance requirements, we are not required to hold an annual meeting until no later
than one year after our first fiscal year end following our listing on Nasdaq. Under Section 211(b) of the DGCL, we are, however,
required to hold an annual meeting of stockholders for the purposes of electing directors in accordance with our bylaws unless
such election is made by written consent in lieu of such a meeting. We may not hold an annual meeting of stockholders to elect
new directors prior to the consummation of our initial business combination, and thus we may not be in compliance with Section
211(b) of the DGCL, which requires an annual meeting. Therefore, if our stockholders want us to hold an annual meeting prior to
the consummation of our initial business combination, they may attempt to force us to hold one by submitting an application to
the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL.
Because
we are neither limited to evaluating a target business in a particular industry sector nor have we selected any specific target
businesses with which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular
target business’s operations.
Our
efforts to identify a prospective initial business combination target will not be limited to a particular industry, sector or
geographic region. While we may pursue an initial business combination opportunity in any industry or sector, we intend to capitalize
on the ability of our management team to identify, acquire and operate a business or businesses that can benefit from our management
team’s established global relationships and operating experience. Our management team has extensive experience in identifying
and executing strategic investments globally and has done so successfully in a number of sectors. Our Charter prohibits us from
effectuating a business combination with another blank check company or similar company with nominal operations. Because we have
not yet selected any specific target business with respect to a business combination, there is no basis to evaluate the possible
merits or risks of any particular target business’s operations, results of operations, cash flows, liquidity, financial
condition or prospects. To the extent we complete our initial business combination, we may be affected by numerous risks inherent
in the business operations with which we combine. For example, if we combine with a financially unstable business or an entity
lacking an established record of sales or earnings, we may be affected by the risks inherent in the business and operations of
a financially unstable or a development stage entity. Although our officers and directors will endeavor to evaluate the risks
inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant
risk factors or that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of
our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business.
We also cannot assure you that an investment in our units will ultimately prove to be more favorable to investors than a direct
investment, if such opportunity were available, in a business combination target. Accordingly, any stockholders or warrant holders
who choose to remain stockholders or warrant holders following our initial business combination could suffer a reduction in the
value of their securities. Such stockholders or warrant holders are unlikely to have a remedy for such reduction in value unless
they are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or
other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy
materials or tender offer documents, as applicable, relating to the business combination contained an actionable material misstatement
or material omission.
We
may seek business combination opportunities in industries or sectors that may be outside of our management’s areas of expertise.
We
will consider a business combination outside of our management’s areas of expertise if a business combination candidate
is presented to us and we determine that such candidate offers an attractive business combination opportunity for our company.
Although our management will endeavor to evaluate the risks inherent in any particular business combination candidate, we cannot
assure you that we will adequately ascertain or assess all of the significant risk factors. We also cannot assure you that an
investment in our units will not ultimately prove to be less favorable to investors in the Public Offering than a direct investment,
if an opportunity were available, in a business combination candidate. In the event we elect to pursue a business combination
outside of the areas of our management’s expertise, our management’s expertise may not be directly applicable to its
evaluation or operation, and the information contained in this prospectus regarding the areas of our management’s expertise
would not be relevant to an understanding of the business that we elect to acquire. As a result, our management may not be able
to ascertain or assess adequately all of the relevant risk factors. Accordingly, any stockholders who choose to remain stockholders
following our initial business combination could suffer a reduction in the value of their shares. Such stockholders are unlikely
to have a remedy for such reduction in value.
Although
we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses,
we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result,
the target business with which we enter into our initial business combination may not have attributes entirely consistent with
our general criteria and guidelines.
Although
we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target
business with which we enter into our initial business combination will not have attributes consistent with our general criteria
and guidelines. If we complete our initial business combination with a target that does not meet some or all of these guidelines,
such combination may not be as successful as a combination with a business that does meet all of our general criteria and guidelines.
In addition, if we announce a prospective business combination with a target that does not meet our general criteria and guidelines,
a greater number of stockholders may exercise their redemption rights, which may make it difficult for us to meet any closing
condition with a target business that requires us to have a minimum net worth or a certain amount of cash. In addition, if stockholder
approval of the transaction is required by law, or we decide to obtain stockholder approval for business or other reasons, it
may be more difficult for us to attain stockholder approval of our initial business combination if the target business does not
meet our general criteria and guidelines. If we are unable to complete our initial business combination, our public stockholders
may only receive their pro rata portion of the funds in the Trust Account that are available for distribution to public stockholders,
and our warrants will expire worthless.
We
are not required to obtain an opinion from an independent investment banking firm or from a valuation or appraisal firm, and consequently,
you may have no assurance from an independent source that the price we are paying for the business is fair to our stockholders
from a financial point of view.
Unless
we complete our initial business combination with an affiliated entity or our board of directors cannot independently determine
the fair market value of the target business or businesses (including with the assistance of financial advisors), we are not required
to obtain an opinion from an independent investment banking firm which is a member of FINRA or from a valuation or appraisal firm
that the price we are paying is fair to our stockholders from a financial point of view. If no opinion is obtained, our stockholders
will be relying on the judgment of our board of directors, who will determine fair market value based on standards generally accepted
by the financial community. Such standards used will be disclosed in our proxy materials or tender offer documents, as applicable,
related to our initial business combination.
We
may issue additional shares of Class A common stock or shares of preferred stock to complete our initial business combination
or under an employee incentive plan after completion of our initial business combination. We may also issue shares of Class A
common stock upon the conversion of the Founder Shares at a ratio greater than one-to-one at the time of our initial business
combination as a result of the anti-dilution provisions contained in our Charter. Any such issuances would dilute the interest
of our stockholders and likely present other risks.
Our Charter authorizes the issuance of up to 380,000,000 shares of
Class A common stock, par value $0.0001 per share, 20,000,000 shares of Class B common stock, par value $0.0001 per share, and 1,000,000
shares of preferred stock, par value $0.0001 per share. As of March 31, 2022, there are 345,910,389 and 11,477,597 authorized but unissued
shares of Class A common stock and Class B common stock, respectively, available for issuance which amount does not take into account
shares reserved for issuance upon exercise of outstanding warrants or shares issuable upon conversion of the Class B common stock. The
Class B common stock is automatically convertible into Class A common stock concurrently with or immediately following the consummation
of our initial business combination, initially at a one-for-one ratio but subject to adjustment as set forth herein and in our Charter.
Immediately after the Public Offering, there will be no shares of preferred stock issued and outstanding.
We
may issue a substantial number of additional shares of Class A common stock or shares of preferred stock to complete our initial
business combination or under an employee incentive plan after completion of our initial business combination. We may also issue
shares of Class A common stock to redeem the warrants as described in “Description of Securities — Warrants —
Public Stockholders’ Warrants — Redemption of warrants when the price per share of Class A common stock equals or
exceeds $10.00 or upon conversion of the Class B common stock at a ratio greater than one-to-one at the time of our initial business
combination as a result of the anti-dilution provisions as set forth therein. However, our Charter provides, among other things,
that prior to our initial business combination, we may not issue additional shares that would entitle the holders thereof to (i)
receive funds from the Trust Account or (ii) vote as a class with our Public Shares (a) on any initial business combination or
(b) to approve an amendment to our Charter to (x) extend the time we have to consummate a business combination beyond 24 months
from the closing of the Public Offering or (y) amend the foregoing provisions. These provisions of our Charter, like all provisions
of our Charter, may be amended with a stockholder vote. The issuance of additional shares of common stock or shares of preferred
stock:
| ● | may
significantly dilute the equity interest of investors in the Public Offering; |
| ● | may
subordinate the rights of holders of Class A common stock if shares of preferred stock are issued with rights senior to those afforded
our Class A common stock; |
| ● | could
cause a change in control if a substantial number of shares of Class A common stock is issued, which may affect, among other things,
our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers
and directors; and |
| ● | may
adversely affect prevailing market prices for our units, Class A common stock and/or warrants. |
Unlike
some other similarly structured special purpose acquisition companies, our initial stockholders will receive additional shares
of Class A common stock if we issue certain shares to consummate an initial business combination.
The
Founder Shares will automatically convert into shares of Class A common stock concurrently with or immediately following the consummation
of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations,
recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional shares of Class
A common stock or equity-linked securities are issued or deemed issued in connection with our initial business combination, the
number of shares of Class A common stock issuable upon conversion of all Founder Shares will equal, in the aggregate, on an as-converted
basis, 20% of the total number of shares of Class A common stock outstanding after such conversion (after giving effect to any
redemptions of shares of Class A common stock by public stockholders), including the total number of shares of Class A common
stock issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed
issued, by the company in connection with or in relation to the consummation of the initial business combination, excluding any
shares of Class A common stock or equity-linked securities or rights exercisable for or convertible into shares of Class A common
stock issued, or to be issued, to any seller in the initial business combination and any Private Placement Warrants issued to
our Sponsors, officers or directors upon conversion of working capital loans, provided that such conversion of Founder Shares
will never occur on a less than one-for-one basis. This is different than some other similarly structured special purpose acquisition
companies in which the initial stockholders will only be issued an aggregate of 20% of the total number of shares to be outstanding
prior to our initial business combination.
Resources
could be wasted in researching business combinations that are not completed, which could materially adversely affect subsequent
attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination,
our public stockholders may only receive their pro rata portion of the funds in the Trust Account that are available for distribution
to public stockholders, and our warrants will expire worthless.
We
anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements,
disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants,
attorneys and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point
for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target
business, we may fail to complete our initial business combination for any number of reasons including those beyond our control.
Any such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts
to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public
stockholders may only receive their pro rata portion of the funds in the Trust Account that are available for distribution to
public stockholders, and our warrants will expire worthless.
We
may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated
with our Sponsors, executive officers, directors or existing holders which may raise potential conflicts of interest.
In
light of the involvement of our Sponsors, executive officers and directors with other entities, we may decide to acquire one or
more businesses affiliated with our Sponsors, executive officers, directors or existing holders. Our directors also serve as officers
and board members for other entities, including, without limitation, those described under “Management — Conflicts
of Interest.” Such entities may compete with us for business combination opportunities. Our Sponsors, officers and directors
are not currently aware of any specific opportunities for us to complete our initial business combination with any entities with
which they are affiliated, and there have been no substantive discussions concerning a business combination with any such entity
or entities. Although we will not be specifically focusing on, or targeting, any transaction with any affiliated entities, we
would pursue such a transaction if we determined that such affiliated entity met our criteria for a business combination as set
forth in “Proposed Business — Effecting our initial business combination — Selection of a target business and
structuring of our initial business combination” and such transaction was approved by a majority of our independent and
disinterested directors. Despite our agreement to obtain an opinion from an independent investment banking firm which is a member
of FINRA or a valuation or appraisal firm regarding the fairness to our company from a financial point of view of a business combination
with one or more domestic or international businesses affiliated with our Sponsors, executive officers, directors or existing
holders, potential conflicts of interest still may exist and, as a result, the terms of the business combination may not be as
advantageous to our public stockholders as they would be absent any conflicts of interest.
Since
our Sponsors, executive officers and directors will lose their entire investment in us if our initial business combination is
not completed (other than with respect to Public Shares they may acquire during or after the Public Offering), a conflict of interest
may arise in determining whether a particular business combination target is appropriate for our initial business combination.
On
February 18, 2021, 1P subscribed for an aggregate 11,500,000 Founder Shares for a total subscription price of $25,000, or approximately
$0.003 per share. Such shares are fully paid, and the cash amount of the subscription price therefore was received on February
18, 2021. In March 2021, 1P transferred an aggregate of 1,150,000 Founder Shares to Horn and 125,000 Founder Shares to each of
Messrs. Clarke, Sidler and Sultemeier, resulting in 1P holding 9,975,000 Founder Shares. On March 31, 2021, 1P and Horn surrendered
1,288,904 and 148,596 Founder Shares, respectively, to us for cancellation for no consideration resulting in 1P and Horn holding
8,686,096 and 1,001,404 Founder Shares, respectively. On May 13, 2021, Horn transferred 1,001,404 Founder Shares to AG LIT. On
June 10, 2021 1P and AG LIT surrendered 1,288,905 and 148,595 Founder Shares, respectively, to us for no consideration resulting
in 1P and AG LIT holding 7,397,191 and 852,809 Founder Shares, respectively. Of the 8,625,000 shares of Class B common stock outstanding,
an aggregate of 1,125,000 shares were subject to forfeiture to the extent that the underwriter’s over-allotment option was
not exercised in full. The forfeiture would be adjusted to the extent that the over-allotment option was not exercised in full
by the underwriters so that the Founder Shares would represent 20.0% of the Company’s issued and outstanding shares after
the IPO. On June 15, 2021 the underwriter’s over-allotment option was partially exercised. As of June 15, 2021, there were
8,625,000 shares of Class B common stock issued and outstanding, 102,597 of which were subject to forfeiture. On July 26, 2021,
such remaining Founder Shares were forfeited.
Prior
to the initial investment in the company of $25,000 by 1P, the company had no assets, tangible or intangible. The purchase price
of the Founder Shares was determined by dividing the amount of cash contributed to the company by the number of Founder Shares
issued. The number of Founder Shares outstanding was determined based on the expectation that the total size of the Public Offering
would be a maximum of 34,500,000 units if the underwriters’ over-allotment option was exercised in full, and therefore that
such Founder Shares would represent 20% of the outstanding shares after the Public Offering. The Founder Shares will be worthless
if we do not complete an initial business combination. In addition, our Sponsors have committed to purchase an aggregate of 5,945,281
Private Placement Warrants, each exercisable for one share of Class A common stock at $11.50 per share, for an aggregate purchase
price of $8,917,922, or $1.50 per warrant, that will also be worthless if we do not complete our initial business combination.
The personal and financial interests of our executive officers and directors may influence their motivation in identifying and
selecting a target business combination, completing an initial business combination and influencing the operation of the business
following the initial business combination. This risk may become more acute as the 24-month anniversary of the closing of the
Public Offering nears, which is the deadline for our completion of an initial business combination.
We
may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely
affect our leverage and financial condition and thus negatively impact the value of our stockholders’ investment in us.
Although
we have no commitments as of the date of this prospectus to issue any notes or other debt securities, or to otherwise incur outstanding
debt following the Public Offering, we may choose to incur substantial debt to complete our initial business combination. We and
our officers have agreed that we will not incur any indebtedness unless we have obtained from the lender a waiver of any right,
title, interest or claim of any kind in or to the monies held in the Trust Account. As such, no issuance of debt will affect the
per share amount available for redemption from the Trust Account. Nevertheless, the incurrence of debt could have a variety of
negative effects, including:
| ● | default
and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations; |
| ● | acceleration
of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants
that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
| ● | our
immediate payment of all principal and accrued interest, if any, if the debt is payable on demand; |
| ● | our
inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while
the debt is outstanding; |
| ● | our
inability to pay dividends on our Class A common stock; |
| ● | using
a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends
on our Class A common stock if declared, expenses, capital expenditures, acquisitions and other general corporate purposes; |
| ● | limitations
on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
| ● | increased
vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
and |
| ● | limitations
on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of
our strategy and other purposes and other disadvantages compared to our competitors who have less debt. |
We
may only be able to complete one business combination with the proceeds of the Public Offering and the sale of the Private Placement
Warrants, which will cause us to be solely dependent on a single business which may have a limited number of products or services.
This lack of diversification may negatively impact our operations and profitability.
The
net proceeds from the Public Offering and the private placement of warrants provided us with $328,964,746 that we may use to complete
our initial business combination and pay related fees and expenses (after taking into account the $11,931,364 of deferred underwriting
commissions being held in the Trust Account and the estimated offering expenses).
We
may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or
within a short period of time. However, we may not be able to effectuate our initial business combination with more than one target
business because of various factors, including the existence of complex accounting issues and the requirement that we prepare
and file pro forma financial statements with the SEC that present operating results and the financial condition of several target
businesses as if they had been operated on a combined basis. By completing our initial business combination with only a single
entity, our lack of diversification may subject us to numerous economic, competitive and regulatory developments. Further, we
would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike
other entities which may have the resources to complete several business combinations in different industries or different areas
of a single industry. Accordingly, the prospects for our success may be:
| ● | solely
dependent upon the performance of a single business, property or asset, or |
| ● | dependent
upon the development or market acceptance of a single or limited number of products, processes or services. |
This
lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a
substantial adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.
We
may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to
complete our initial business combination and give rise to increased costs and risks that could negatively impact our operations
and profitability.
If
we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers
to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which
may make it more difficult for us, and delay our ability, to complete our initial business combination. With multiple business
combinations, we could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations
and due diligence investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation
of the operations and services or products of the acquired companies in a single operating business. If we are unable to adequately
address these risks, it could negatively impact our profitability and results of operations.
We
may attempt to complete our initial business combination with a private company about which little information is available, which
may result in a business combination with a company that is not as profitable as we suspected, if at all.
In
pursuing our business combination strategy, we may seek to effectuate our initial business combination with a privately held company.
Very little public information generally exists about private companies, and we could be required to make our decision on whether
to pursue a potential initial business combination on the basis of limited information, which may result in a business combination
with a company that is not as profitable as we suspected, if at all.
We
do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to
complete our initial business combination with which a substantial majority of our stockholders or warrant holders do not agree.
Our
Charter does not provide a specified maximum redemption threshold, except that in no event will we redeem our Public Shares in
an amount that would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination
may impose a minimum cash requirement for: (i) cash consideration to be paid to the target or its owners, (ii) cash for working
capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions. As a result, we may be
able to complete our initial business combination even though a substantial majority of our public stockholders do not agree with
the transaction and have redeemed their shares or, if we seek stockholder approval of our initial business combination and do
not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into
privately negotiated agreements to sell their shares to our Sponsors, officers, directors, advisors or any of their respective
affiliates. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that
are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed
business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem
any shares in connection with such initial business combination, all shares of Class A common stock submitted for redemption will
be returned to the holders thereof, and we instead may search for an alternate business combination.
In
order to effectuate an initial business combination, special purpose acquisition companies have, in the recent past, amended various
provisions of their charters and other governing instruments, including their warrant agreements. We cannot assure you that we
will not seek to amend our Charter or governing instruments in a manner that will make it easier for us to complete our initial
business combination that our stockholders may not support.
In
order to effectuate a business combination, special purpose acquisition companies have, in the recent past, amended various provisions
of their charters and governing instruments, including their warrant agreements. For example, special purpose acquisition companies
have amended the definition of business combination, increased redemption thresholds and extended the time to consummate an initial
business combination and, with respect to their warrants, amended their warrant agreements to require the warrants to be exchanged
for cash and/or other securities. Amending our Charter requires the approval of holders of 65% of our common stock, and amending
our warrant agreement will require a vote of holders of at least 50% of the Public Warrants and, solely with respect to any amendment
to the terms of the Private Placement Warrants or any provision of the warrant agreement with respect to the Private Placement
Warrants, 50% of the number of the then outstanding Private Placement Warrants. In addition, our Charter requires us to provide
our public stockholders with the opportunity to redeem their Public Shares for cash if we propose an amendment to our Charter
to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or
to redeem 100% of our Public Shares if we do not complete an initial business combination within 24 months of the closing of the
Public Offering or with respect to any other material provisions relating to stockholders’ rights or pre-initial business
combination activity. To the extent any of such amendments would be deemed to fundamentally change the nature of the securities
offered through this registration statement, we would register, or seek an exemption from registration for, the affected securities.
We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate an initial
business combination in order to effectuate our initial business combination.
The
provisions of our Charter that relate to our pre-business combination activity (and corresponding provisions of the agreement
governing the release of funds from our Trust Account) may be amended with the approval of holders of 65% of our common stock,
which is a lower amendment threshold than that of some other special purpose acquisition companies. It may be easier for us, therefore,
to amend our Charter to facilitate the completion of an initial business combination that some of our stockholders may not support.
Our
Charter provides that any of its provisions related to pre-business combination activity (including the requirement to deposit
proceeds of the Public Offering and the private placement of warrants into the Trust Account and not release such amounts except
in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved
by holders of 65% of our common stock entitled to vote thereon and corresponding provisions of the trust agreement governing the
release of funds from our Trust Account may be amended if approved by holders of 65% of our common stock entitled to vote thereon.
In all other instances, our Charter may be amended by holders of a majority of our outstanding common stock entitled to vote thereon,
subject to applicable provisions of the DGCL or applicable stock exchange rules. Our initial stockholders, who will collectively
beneficially own 20% of our common stock upon the closing of the Public Offering (assuming they do not purchase any units in the
Public Offering), may participate in any vote to amend our Charter and/or trust agreement and will have the discretion to vote
in any manner they choose. As a result, we may be able to amend the provisions of our Charter which govern our pre-business combination
behavior more easily than some other special purpose acquisition companies, and this may increase our ability to complete a business
combination with which you do not agree. Our stockholders may pursue remedies against us for any breach of our Charter.
Our
Sponsors, executive officers and directors have agreed, pursuant to written agreements with us, that they will not propose any
amendment to our Charter to modify the substance or timing of our obligation to allow redemption in connection with our initial
business combination or to redeem 100% of our Public Shares if we do not complete our initial business combination within 24 months
from the closing of the Public Offering or with respect to any other material provisions relating to stockholders’ rights
or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their Class
A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on
deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to
us to pay our taxes, divided by the number of then outstanding Public Shares. Our stockholders are not parties to, or third-party
beneficiaries of, these agreements and, as a result, will not have the ability to pursue remedies against our Sponsors, executive
officers or directors for any breach of these agreements. As a result, in the event of a breach, our stockholders would need to
pursue a stockholder derivative action, subject to applicable law.
We
may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth
of a target business, which could compel us to restructure or abandon a particular business combination.
We
have not selected any specific business combination target but intend to target businesses with enterprise values that are greater
than we could acquire with the net proceeds of the Public Offering and the sale of the Private Placement Warrants. As a result,
if the cash portion of the purchase price exceeds the amount available from the Trust Account, net of amounts needed to satisfy
any redemption by public stockholders, we may be required to seek additional financing to complete such proposed initial business
combination. We cannot assure you that such financing will be available on acceptable terms, if at all. To the extent that additional
financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure
the transaction or abandon that particular business combination and seek an alternative target business candidate. Further, we
may be required to obtain additional financing in connection with the closing of our initial business combination for general
corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal
or interest due on indebtedness incurred in completing our initial business combination, or to fund the purchase of other companies.
If we are unable to complete our initial business combination, our public stockholders may only receive their pro rata portion
of the funds in the Trust Account that are available for distribution to public stockholders, and our warrants will expire worthless.
In addition, even if we do not need additional financing to complete our initial business combination, we may require such financing
to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse
effect on the continued development or growth of the target business. None of our officers, directors or stockholders is required
to provide any financing to us in connection with or after our initial business combination.
Our
initial stockholders control a substantial interest in us and thus may exert a substantial influence on actions requiring a stockholder
vote, potentially in a manner that you do not support.
Upon
closing of the Public Offering, our initial stockholders will own 20% of our issued and outstanding common stock (assuming they
do not purchase any units in the Public Offering). Accordingly, they may exert a substantial influence on actions requiring a
stockholder vote, potentially in a manner that you do not support, including amendments to our Charter. If our initial stockholders
purchase any units in the Public Offering or if our initial stockholders purchase any additional Class A common stock in the aftermarket
or in privately negotiated transactions, this would increase their control. Neither our initial stockholders nor, to our knowledge,
any of our officers or directors, have any current intention to purchase additional securities, other than as disclosed in this
prospectus. Factors that would be considered in making such additional purchases would include consideration of the current trading
price of our Class A common stock. In addition, our board of directors, whose members were elected by our Sponsors, is and will
be divided into three classes, each of which will generally serve for a terms for three years with only one class of directors
being elected in each year. We may not hold an annual meeting of stockholders to elect new directors prior to the completion of
our initial business combination, in which case all of the current directors will continue in office until at least the completion
of the business combination. If there is an annual meeting, as a consequence of our “staggered” board of directors,
only a minority of the board of directors will be considered for election and our initial stockholders, because of their ownership
position, will have considerable influence regarding the outcome. Accordingly, our initial stockholders will continue to exert
control at least until the completion of our initial business combination.
Because
we must furnish our stockholders with target business financial statements, we may lose the ability to complete an otherwise advantageous
initial business combination with some prospective target businesses.
The
federal proxy rules require that the proxy statement with respect to the vote on an initial business combination include historical
and pro forma financial statement disclosure. We will include the same financial statement disclosure in connection with our tender
offer documents, whether or not they are required under the tender offer rules. These financial statements may be required to
be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United States of America
(“GAAP”), or international financial reporting standards as issued by the International Accounting Standards Board
(“IFRS”), depending on the circumstances and the historical financial statements may be required to be audited in
accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”). These financial
statement requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to
provide such financial statements in time for us to disclose such statements in accordance with federal proxy rules and complete
our initial business combination within the prescribed time frame.
Compliance
obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require
substantial financial and management resources, and increase the time and costs of completing an initial business combination.
Section
404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual
Report on Form 10-K for the year ending December 31, 2022. Only in the event we are deemed to be a large accelerated filer or
an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent
registered public accounting firm attestation requirement on our internal control over financial reporting. Further, for as long
as we remain an emerging growth company, we will not be required to comply with the independent registered public accounting firm
attestation requirement on our internal control over financial reporting. The fact that we are a blank check company makes compliance
with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a
target business with which we seek to complete our initial business combination may not be in compliance with the provisions of
the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal control of any such entity
to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such business combination.
We
may seek business combination opportunities with a high degree of complexity that require significant operational improvements,
which could delay or prevent us from achieving our desired results.
We
may seek business combination opportunities with large, highly complex companies that we believe would benefit from operational
improvements. While we intend to implement such improvements, to the extent that our efforts are delayed or we are unable to achieve
the desired improvements, the initial business combination may not be as successful as we anticipate.
To
the extent we complete our initial business combination with a large complex business or entity with a complex operating structure,
we may also be affected by numerous risks inherent in the operations of the business with which we combine, which could delay
or prevent us from implementing our strategy. Although our management team will endeavor to evaluate the risks inherent in a particular
target business and its operations, we may not be able to properly ascertain or assess all of the significant risk factors until
we complete our initial business combination. If we are not able to achieve our desired operational improvements, or the improvements
take longer to implement than anticipated, we may not achieve the gains that we anticipate. Furthermore, some of these risks and
complexities may be outside of our control and leave us with no ability to control or reduce the chances that those risks and
complexities will adversely impact a target business. Such combination may not be as successful as a combination with a smaller,
less complex organization.
RISKS
RELATING TO THE POST-BUSINESS COMBINATION COMPANY
Subsequent
to our completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and
impairment or other charges that could have a significant negative effect on our financial condition, results of operations and
the price of our securities, which could cause you to lose some or all of your investment.
Even
if we conduct extensive due diligence on a target business with which we combine, we cannot assure you that this diligence will
identify all material issues that may be present with a particular target business, that it would be possible to uncover all material
issues through a customary amount of due diligence, or that factors outside of the target business and outside of our control
will not later arise. As a result of these factors, we may be forced to later write-down or write-off assets, restructure our
operations, or incur impairment or other charges that could result in our reporting losses. Even if our due diligence successfully
identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with
our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity,
the fact that we report charges of this nature could contribute to negative market perceptions about us or our securities. In
addition, charges of this nature may cause us to violate net worth or other covenants to which we may be subject as a result of
assuming pre-existing debt held by a target business or by virtue of our obtaining debt financing to partially finance the initial
business combination or thereafter. Accordingly, any stockholders or warrant holders who choose to remain stockholders or warrant
holders following the business combination could suffer a reduction in the value of their securities. Such stockholders or warrant
holders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction
was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able
to successfully bring a private claim under securities laws that the proxy materials or tender offer documents, as applicable,
relating to the business combination contained an actionable material misstatement or material omission.
The
officers and directors of an acquisition candidate may resign upon completion of our initial business combination. The loss of
a business combination target’s key personnel could negatively impact the operations and profitability of our post-combination
business.
The
role of an acquisition candidate’s key personnel upon the completion of our initial business combination cannot be ascertained
at this time. Although we contemplate that certain members of an acquisition candidate’s management team will remain associated
with the acquisition candidate following our initial business combination, it is possible that members of the management of an
acquisition candidate will not wish to remain in place.
Our
management may not maintain control of a target business after our initial business combination. We cannot provide assurance that,
upon loss of control of a target business, new management will possess the skills, qualifications or abilities necessary to profitably
operate such business.
We
may structure our initial business combination so that the post-transaction company in which our public stockholders own shares
will own less than 100% of the equity interests or assets of a target business, but we will only complete such business combination
if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires
a controlling interest in the target sufficient for us not to be required to register as an investment company under the Investment
Company Act. We will not consider any transaction that does not meet such criteria. Even if the post-transaction company owns
50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively
own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the
business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares of Class
A common stock in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% interest
in the target. However, as a result of the issuance of a substantial number of new shares of Class A common stock, our stockholders
immediately prior to such transaction could own less than a majority of our outstanding Class A common stock subsequent to such
transaction. In addition, other minority stockholders may subsequently combine their holdings resulting in a single person or
group obtaining a larger share of the company’s shares than we initially acquired. Accordingly, this may make it more likely
that our management will not maintain control of the target business.
We
may have a limited ability to assess the management of a prospective target business and, as a result, may effect our initial
business combination with a target business whose management may not have the skills, qualifications or abilities to manage a
public company.
When
evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess
the target business’s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities
of the target business’s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications
or abilities we suspected. Should the target business’s management not possess the skills, qualifications or abilities necessary
to manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly,
any stockholders or warrant holders who choose to remain stockholders or warrant holders following the business combination could
suffer a reduction in the value of their securities. Such stockholders or warrant holders are unlikely to have a remedy for such
reduction in value unless they are able to successfully claim that the reduction was due to the breach by our officers or directors
of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities
laws that the proxy solicitation or tender offer materials, as applicable, relating to the business combination contained an actionable
material misstatement or material omission.
There
are risks related to the logistics and logistics technology industry to which we may be subject.
Business
combinations with companies with operations in the logistics and logistics technology industry entail special considerations and
risks. If we are successful in completing a business combination with a target business with operations in the logistics and logistics
technology industry, we will be subject to, and possibly adversely affected by, the following risks, including but not limited
to:
| ● | Competition
could reduce profit margins. |
| ● | Our
inability to comply with governmental regulations affecting the logistics and logistics technology industry could negatively affect our
operations. |
| ● | An
inability to license or enforce intellectual property rights on which our business may depend. |
| ● | The
success of our planned business following consummation of our initial business combination may depend on maintaining a well-secured business
and technology infrastructure. |
| ● | Legal
and regulatory changes related to data protection and privacy could create unexpected costs, impact the use and adoption of a target
business’ services or require a target business to agree to onerous terms and conditions, which could have an adverse impact on
its future revenue, operating results or customer retention, and may reduce our future revenue and our profitability following such business
combination. |
| ● | Changes
in the logistics and logistics technology industry could negatively impact customer relationships and our results of operations. |
| ● | The
logistics and logistics technology industry is susceptible to significant liability exposure, including cyberattacks and security and
privacy breaches. If liability claims are brought against us following a business combination, it could materially adversely affect our
operations. |
| ● | Dependence
of our operations upon third-party suppliers, manufacturers or contractors whose failure to perform adequately could disrupt our
business. |
Any
of the foregoing could have an adverse impact on our operations following a business combination. However, our efforts in identifying
prospective target businesses will not be limited to the logistics and logistics technology industry. Accordingly, if we acquire
a target business in another industry, these risks will likely not affect us and we will be subject to other risks attendant with
the specific industry in which we operate or target business which we acquire, none of which can be presently ascertained.
RISKS
RELATING TO ACQUIRING AND OPERATING A BUSINESS IN FOREIGN COUNTRIES
If
we effect our initial business combination with a company located outside of the United States, we would be subject to a variety
of additional risks that may adversely affect us.
If
we pursue a target company with operations or opportunities outside of the United States for our initial business combination,
we may face additional burdens in connection with investigating, agreeing to and completing such initial business combination,
and if we effect such initial business combination, we would be subject to a variety of additional risks that may negatively impact
our operations.
If
we pursue a target a company with operations or opportunities outside of the United States for our initial business combination,
we would be subject to risks associated with cross-border business combinations, including in connection with investigating, agreeing
to and completing our initial business combination, conducting due diligence in a foreign jurisdiction, having such transaction
approved by any local governments, regulators or agencies and changes in the purchase price based on fluctuations in foreign exchange
rates.
If
we effect our initial business combination with such a company, we would be subject to any special considerations or risks associated
with companies operating in an international setting, including any of the following:
| ● | costs
and difficulties inherent in managing cross-border business operations; |
| ● | rules
and regulations regarding currency redemption; |
| ● | complex
corporate withholding taxes on individuals; |
| ● | laws
governing the manner in which future business combinations may be effected; |
| ● | exchange
listing and/or delisting requirements; |
| ● | tariffs
and trade barriers; |
| ● | regulations
related to customs and import/export matters; |
| ● | local
or regional economic policies and market conditions; |
| ● | unexpected
changes in regulatory requirements; |
| ● | challenges
in managing and staffing international operations; |
| ● | tax
issues, such as tax law changes and variations in tax laws as compared to the United States; |
| ● | currency
fluctuations and exchange controls; |
| ● | challenges
in collecting accounts receivable; |
| ● | cultural
and language differences; |
| ● | underdeveloped
or unpredictable legal or regulatory systems; |
| ● | protection
of intellectual property; |
| ● | social
unrest, crime, strikes, riots and civil disturbances; |
| ● | regime
changes and political upheaval; |
| ● | terrorist
attacks and wars; and |
| ● | deterioration
of political relations with the United States. |
We
may not be able to adequately address these additional risks. If we were unable to do so, we may be unable to complete such initial
business combination, or, if we complete such initial business combination, our operations might suffer, either of which may adversely
impact our business, financial condition and results of operations.
RISKS
RELATING TO OUR MANAGEMENT TEAM
We
are dependent upon our executive officers and directors and their loss could adversely affect our ability to operate.
Our
operations are dependent upon a relatively small group of individuals and, in particular, our executive officers and directors.
We believe that our success depends on the continued service of our officers and directors, at least until we have completed our
initial business combination. In addition, our executive officers and directors are not required to commit any specified amount
of time to our affairs and, accordingly, will have conflicts of interest in allocating their time among various business activities,
including identifying potential business combinations and monitoring the related due diligence. We do not have an employment agreement
with, or key-man insurance on the life of, any of our directors or executive officers. The unexpected loss of the services of
one or more of our directors or executive officers could have a detrimental effect on us.
Involvement
of members of our management and companies with which they are affiliated in civil disputes and litigation or governmental investigations
unrelated to our business affairs could materially impact our ability to complete an initial business combination.
Members
of our management team and companies with which they are affiliated have been, and in the future will continue to be, involved
in a wide variety of business affairs, including transactions, such as sales and purchases of businesses, and ongoing operations.
As a result of such involvement, members of our management and companies with which they are affiliated in past have been, and
may in the future be, involved in civil disputes and litigation and governmental investigations relating to their business affairs
unrelated to our company. Any claims or investigations involving members of our management and companies with which they are affiliated
may be detrimental to our reputation and could negatively affect our ability to identify and complete an initial business combination
in a material manner and may have an adverse effect on the price of our securities.
Our
ability to successfully effect our initial business combination and to be successful thereafter will be dependent upon the efforts
of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively
impact the operations and profitability of our post-combination business.
Our
ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of
our key personnel in the target business, however, cannot presently be ascertained. Although some of our key personnel may remain
with the target business in senior management or advisory positions following our initial business combination, it is likely that
some or all of the management of the target business will remain in place. While we intend to closely scrutinize any individuals
we engage after our initial business combination, we cannot assure you that our assessment of these individuals will prove to
be correct. These individuals may be unfamiliar with the requirements of operating a company regulated by the SEC, which could
cause us to have to expend time and resources helping them become familiar with such requirements.
Our
key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business
combination, and a particular business combination may be conditioned on the retention or resignation of such key personnel. These
agreements may provide for them to receive compensation following our initial business combination and as a result, may cause
them to have conflicts of interest in determining whether a particular business combination is the most advantageous.
Our
key personnel may be able to remain with our company after the completion of our initial business combination only if they are
able to negotiate employment or consulting agreements in connection with the business combination. Such negotiations would take
place simultaneously with the negotiation of the business combination and could provide for such individuals to receive compensation
in the form of cash payments and/or our securities for services they would render to us after the completion of the business combination.
Such negotiations also could make such key personnel’s retention or resignation a condition to any such agreement. The personal
and financial interests of such individuals may influence their motivation in identifying and selecting a target business, subject
to their fiduciary duties under Delaware law.
Our
executive officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination
as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete
our initial business combination.
Our
executive officers and directors are not required to, and will not, commit their full time to our affairs, which may result in
a conflict of interest in allocating their time between our operations and our search for a business combination and their other
businesses. We do not intend to have any full-time employees prior to the completion of our initial business combination. Each
of our executive officers is engaged in several other business endeavors for which he may be entitled to substantial compensation,
and our executive officers and non-independent directors are not obligated to contribute any specific number of hours per week
to our affairs. Our independent directors also serve as officers and board members for other entities. If our executive officers’
and directors’ other business affairs require them to devote substantial amounts of time to such affairs in excess of their
current commitment levels, it could limit their ability to devote time to our affairs which may have a negative impact on our
ability to complete our initial business combination.
Our
officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations
to other entities and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity
should be presented.
Following
the completion of the Public Offering and until we consummate our initial business combination, we intend to engage in the business
of identifying and combining with one or more businesses. Each of our officers and directors presently has, and any of them in
the future may have, additional fiduciary or contractual obligations to other entities pursuant to which such officer or director
is or will be required to present a business combination opportunity to such entity. Accordingly, they may have conflicts of interest
in determining to which entity a particular business opportunity should be presented. These conflicts may not be resolved in our
favor and a potential target business may be presented to another entity prior to its presentation to us. Our Charter provides
that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly
offered to such person solely in his or her capacity as a director or officer of the company and such opportunity is one we are
legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director
or officer is permitted to refer that opportunity to us without violating another legal obligation. In addition, our Sponsors
and our officers and directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other
business or investment ventures during the period in which we are seeking an initial business combination. Any such companies,
businesses or ventures may present additional conflicts of interest in pursuing an initial business combination. However, we do
not believe that any such potential conflicts would materially affect our ability to complete our initial business combination.
Our
executive officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that
conflict with our interests.
We
have not adopted a policy that expressly prohibits our directors, executive officers, security holders or affiliates from having
a direct or indirect pecuniary or financial interest in any investment to be acquired or disposed of by us or in any transaction
to which we are a party or have an interest. In fact, we may enter into a business combination with a target business that is
affiliated with our Sponsors, our directors or executive officers, although we do not intend to do so. Nor do we have a policy
that expressly prohibits any such persons from engaging for their own account in business activities of the types conducted by
us. Accordingly, such persons or entities may have a conflict between their interests and ours.
The
personal and financial interests of our directors and officers may influence their motivation in timely identifying and selecting
a target business and completing a business combination. Consequently, our directors’ and officers’ discretion in
identifying and selecting a suitable target business may result in a conflict of interest when determining whether the terms,
conditions and timing of a particular business combination are appropriate and in our stockholders’ best interest. If this
were the case, it would be a breach of their fiduciary duties to us as a matter of Delaware law and we or our stockholders might
have a claim against such individuals for infringing on our stockholders’ rights. However, we might not ultimately be successful
in any claim we may make against them for such reason.
We
may not have sufficient funds to satisfy indemnification claims of our directors and executive officers.
We
have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors
have agreed to waive any right, title, interest or claim of any kind in or to any monies in the Trust Account and to not seek
recourse against the Trust Account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied
by us only if (i) we have sufficient funds outside of the Trust Account or (ii) we consummate an initial business combination.
Our obligation to indemnify our officers and directors may discourage stockholders from bringing a lawsuit against our officers
or directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative
litigation against our officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders.
Furthermore, a stockholder’s investment may be adversely affected to the extent we pay the costs of settlement and damage
awards against our officers and directors pursuant to these indemnification provisions.
Certain
agreements related to the Public Offering may be amended without stockholder approval.
Each
of the agreements related to the Public Offering to which we are a party, other than the warrant agreement and the investment
management trust agreement, may be amended without stockholder approval. Such agreements are: the underwriting agreement; the
letter agreement among us and our initial stockholders, officers and directors; the registration rights agreement among us and
our initial stockholders; the Private Placement Warrants purchase agreement between us and our Sponsors; and the administrative
services agreement among us, our Sponsors and an affiliate of our Sponsors. These agreements contain various provisions that our
public stockholders might deem to be material. For example, our letter agreement and the underwriting agreement contain certain
lock-up provisions with respect to the Founder Shares, Private Placement Warrants and other securities held by our initial stockholders,
officers and directors. Amendments to such agreements would require the consent of the applicable parties thereto and would need
to be approved by our board of directors, which may do so for a variety of reasons, including to facilitate our initial business
combination. While we do not expect our board of directors to approve any amendment to any of these agreements prior to our initial
business combination, it may be possible that our board of directors, in exercising its business judgment and subject to its fiduciary
duties, chooses to approve one or more amendments to any such agreement. Any amendment entered into in connection with the consummation
of our initial business combination will be disclosed in our proxy materials or tender offer documents, as applicable, related
to such initial business combination, and any other material amendment to any of our material agreements will be disclosed in
a filing with the SEC. Any such amendments would not require approval from our stockholders, may result in the completion of our
initial business combination that may not otherwise have been possible, and may have an adverse effect on the value of an investment
in our securities. For example, amendments to the lock-up provision discussed above may result in our initial stockholders selling
their securities earlier than they would otherwise be permitted, which may have an adverse effect on the price of our securities.
RISKS
RELATING TO OUR SECURITIES
You
will not have any rights or interests in funds from the Trust Account, except under certain limited circumstances. Therefore,
to liquidate your investment, you may be forced to sell your Public Shares or warrants, potentially at a loss.
Our
public stockholders will be entitled to receive funds from the Trust Account only upon the earlier to occur of: (i) our completion
of an initial business combination, and then only in connection with those shares of Class A common stock that such stockholder
properly elected to redeem, subject to the limitations described herein, (ii) the redemption of any Public Shares properly tendered
in connection with a stockholder vote to amend our Charter to modify the substance or timing of our obligation to allow redemption
in connection with our initial business combination or to redeem 100% of our Public Shares if we do not complete our initial business
combination within 24 months from the closing of the Public Offering or with respect to any other material provisions relating
to stockholders’ rights or pre-initial business combination activity, and (iii) the redemption of our Public Shares if we
are unable to complete an initial business combination within 24 months from the closing of the Public Offering, subject to applicable
law and as further described herein. In addition, if our plan to redeem our Public Shares if we are unable to complete an initial
business combination within 24 months from the closing of the Public Offering is not completed for any reason, compliance with
Delaware law may require that we submit a plan of dissolution to our then-existing stockholders for approval prior to the distribution
of the proceeds held in our Trust Account. In that case, public stockholders may be forced to wait beyond 24 months from the closing
of the Public Offering before they receive funds from our Trust Account. In no other circumstances will a public stockholder have
any right or interest of any kind in the Trust Account. Holders of warrants will not have any right to the proceeds held in the
Trust Account with respect to the warrants. Accordingly, to liquidate your investment, you may be forced to sell your Public Shares
or warrants, potentially at a loss.
Nasdaq
may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our
securities and subject us to additional trading restrictions.
We
have been approved to have our units listed on Nasdaq, and our Class A common stock and warrants have been listed on Nasdaq
promptly after their date of separation. Although after giving effect to the Public Offering we expect to meet, on a pro
forma basis, the minimum initial listing standards set forth in Nasdaq listing standards, we cannot assure you that our
securities will continue to be listed on Nasdaq in the future or prior to our initial business combination. In order to
continue listing our securities on Nasdaq prior to our initial business combination, we must maintain certain financial,
distribution and share price levels. Generally, we must maintain a minimum amount in stockholders’ equity (generally
$2,500,000) and a minimum number of holders of our securities (generally 300 public holder
Additionally,
in connection with our initial business combination, we will be required to demonstrate compliance with Nasdaq’s initial
listing requirements, which are more rigorous than Nasdaq’s continued listing requirements, in order to continue to maintain
the listing of our securities on Nasdaq. For instance, our stock price would generally be required to be at least $4.00 per share,
our stockholders’ equity would generally be required to be at least $4.0 million, we would be required to have a minimum
of 300 round lot holders of our securities and we would be required to have a market value of listed securities of $50.0 million We
cannot assure you that we will be able to meet those initial listing requirements at that time.
If
Nasdaq delists our securities from trading on its exchange and we are not able to list our securities on another national securities
exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant
material adverse consequences, including:
| ● | a
limited availability of market quotations for our securities; |
| ● | reduced
liquidity for our securities; |
| ● | a
determination that our Class A common stock is a “penny stock” which will require brokers trading in our Class A common stock
to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our
securities; |
| ● | a
limited amount of news and analyst coverage; and |
| ● | a
decreased ability to issue additional securities or obtain additional financing in the future. |
The
National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating
the sale of certain securities, which are referred to as “covered securities.” Because we expect that our units and
eventually our Class A common stock and warrants will be listed on Nasdaq, our units, Class A common stock and warrants will qualify
as covered securities under the statute. Although the states are preempted from regulating the sale of our securities, the federal
statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent
activity, then the states can regulate or bar the sale of covered securities in a particular case. While we are not aware of a
state having used these powers to prohibit or restrict the sale of securities issued by blank check companies, other than the
State of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten
to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if we were no longer
listed on Nasdaq, our securities would not qualify as covered securities under the statute and we would be subject to regulation
in each state in which we offer our securities.
Our
initial stockholders paid an aggregate of $25,000 to cover certain of our offering costs in exchange for 8,625,000 Founder Shares,
or approximately $0.003 per Founder Share and, accordingly, you will experience immediate and substantial dilution from the purchase
of our shares of Class A common stock.
The
difference between the public offering price per share (allocating all of the unit purchase price to the share of Class A common
stock and none to the warrant included in the unit) and the pro forma net tangible book value per share of our Class A common
stock after the Public Offering constitutes the dilution to you and the other investors in the Public Offering. Our initial stockholders
acquired the Founder Shares at a nominal price, significantly contributing to this dilution. This dilution would increase to the
extent that the anti-dilution provisions of the Founder Shares result in the issuance of shares of Class A common stock on a greater
than one-to-one basis upon conversion of the Founder Shares at the time of our initial business combination and would become exacerbated
to the extent that public stockholders seek redemptions from the trust for their Public Shares. In addition, because of the anti-dilution
protection in the Founder Shares, any equity or equity-linked securities issued in connection with our initial business combination
would be disproportionately dilutive to our Class A common stock.
Provisions
in our Charter and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in
the future for our shares of Class A common stock and could entrench management.
Our
Charter contains provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best
interests. These provisions include a staggered board of directors and the ability of the board of directors to designate the
terms of and issue new series of preferred stock, which may make more difficult the removal of management and may discourage transactions
that otherwise could involve payment of a premium over prevailing market prices for our securities.
We
are also subject to anti-takeover provisions under Delaware law, which could delay or prevent a change of control. Together these
provisions may make the removal of management more difficult and may discourage transactions that otherwise could involve payment
of a premium over prevailing market prices for our securities.
Our
initial business combination and our structure thereafter may not be tax-efficient to our stockholders and warrant holders. As
a result of our business combination, our tax obligations may be more complex, burdensome and uncertain.
Although
we will attempt to structure our initial business combination in a tax-efficient manner, tax structuring considerations are complex,
the relevant facts and law are uncertain and may change, and we may prioritize commercial and other considerations over tax considerations.
For example, in connection with our initial business combination and subject to any requisite stockholder approval, we may structure
our business combination in a manner that requires stockholders and/or warrant holders to recognize gain or income for tax purposes,
effect a business combination with a target company in another jurisdiction, or reincorporate in a different jurisdiction (including,
but not limited to, the jurisdiction in which the target company or business is located). We do not intend to make any cash distributions
to stockholders or warrant holders to pay taxes in connection with our business combination or thereafter. Accordingly, a stockholder
or a warrant holder may need to satisfy any liability resulting from our initial business combination with cash from its own funds
or by selling all or a portion of the shares received. In addition, stockholders and warrant holders may also be subject to additional
income, withholding or other taxes with respect to their ownership of us after our initial business combination.
In
addition, we may effect a business combination with a target company that has business operations outside of the United States,
and possibly, business operations in multiple jurisdictions. If we effect such a business combination, we could be subject to
significant income, withholding and other tax obligations in a number of jurisdictions with respect to income, operations and
subsidiaries related to those jurisdictions. Due to the complexity of tax obligations and filings in other jurisdictions, we may
have a heightened risk related to audits or examinations by U.S. federal, state, local and non-U.S. taxing authorities. This additional
complexity and risk could have an adverse effect on our after-tax profitability and financial condition.
We
may amend the terms of the warrants in a manner that may be adverse to holders of Public Warrants with the approval by the holders
of at least 50% of the then outstanding Public Warrants. As a result, the exercise price of your warrants could be increased,
the exercise period could be shortened and the number of shares of Class A common stock purchasable upon exercise of a warrant
could be decreased, all without your approval.
Our
warrants will be issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as
warrant agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any
holder for the purpose of (i) curing any ambiguity or to correct any defective provision or mistake, including to conform the
provisions of the warrant agreement to the description of the terms of the warrants and the warrant agreement as set forth in
the prospectus, (ii) amending the definition of “Ordinary Cash Dividend” as contemplated by and in accordance with
the second sentence of subsection 4.1.2 of the warrant agreement, (iii) amending the threshold in the offer trigger to be more
than 50% of the voting power of our outstanding securities (including with respect to the election of directors), deleting Section
6.2 or amending the terms of the Private Placement Warrants, with the consent of the holders of a majority of the then outstanding
Private Placement Warrants, to provide that the terms of the Private Placement Warrants will not change if transferred to persons
other than permitted transferees or to conform the provisions of the Private Placement Warrants to the terms of the Public Warrants,
or making any other amendments that are necessary in the good faith determination of the company’s board of directors (taking
into account then existing market precedents) to allow for the warrants to be classified as equity in the Company’s financial
statements, or (iv) adding or changing any provisions with respect to matters or questions arising under the warrant agreement
as the parties may deem necessary or desirable and that the parties deem to not adversely affect the rights of the registered
holders of the warrants, and that all other modifications or amendments will require the vote or written consent of the holders
of at least 50% of the then outstanding Public Warrants. Accordingly, we may amend the terms of the Public Warrants in a manner
adverse to a holder if holders of at least 50% of the then outstanding Public Warrants approve of such amendment. Although our
ability to amend the terms of the Public Warrants with the consent of at least 50% of the then outstanding Public Warrants is
unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants,
convert the warrants into cash or stock (at a ratio different than initially provided), shorten the exercise period or decrease
the number of shares of Class A common stock purchasable upon exercise of a warrant.
Our
warrant agreement will designate the courts of the State of New York or the United States District Court for the Southern District
of New York as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our
warrants, which could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company.
Our
warrant agreement provides that, subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating
in any way to the warrant agreement, including under the Securities Act, will be brought and enforced in the courts of the State
of New York or the United States District Court for the Southern District of New York, and (ii) that we irrevocably submit to
such jurisdiction, which jurisdiction shall be the exclusive forum for any such action, proceeding or claim. We will waive any
objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.
Notwithstanding
the foregoing, these provisions of the warrant agreement will not apply to suits brought to enforce any liability or duty created
by the Exchange Act or any other claim for which the federal district courts of the United States of America are the sole and
exclusive forum. Any person or entity purchasing or otherwise acquiring any interest in any of our warrants shall be deemed to
have notice of and to have consented to the forum provisions in our warrant agreement. If any action, the subject matter of which
is within the scope the forum provisions of the warrant agreement, is filed in a court other than a court of the State of New
York or the United States District Court for the Southern District of New York (a “foreign action”) in the name of
any holder of our warrants, such holder shall be deemed to have consented to: (x) the personal jurisdiction of the state and federal
courts located in the State of New York in connection with any action brought in any such court to enforce the forum provisions
(an “enforcement action”), and (y) having service of process made upon such warrant holder in any such enforcement
action by service upon such warrant holder’s counsel in the foreign action as agent for such warrant holder.
This
choice-of-forum provision may limit a warrant holder’s ability to bring a claim in a judicial forum that it finds favorable
for disputes with our company, which may discourage such lawsuits. Alternatively, if a court were to find this provision of our
warrant agreement inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings,
we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially and adversely
affect our business, financial condition and results of operations and result in a diversion of the time and resources of our
management and board of directors.
A
provision of our warrant agreement may make it more difficult for us to complete an initial business combination.
If
(i) we issue additional common stock or equity-linked securities for capital raising purposes in connection with the closing of
our initial business combination at a Newly Issued Price of less than $9.20 per common stock, (ii) the aggregate gross proceeds
from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our
initial business combination on the date of the completion of our initial business combination (net of redemptions), and (iii)
the Market Value is below $9.20 per share, then the exercise price of the warrants will be adjusted to be equal to 115% of the
higher of the Market Value and the Newly Issued Price, and the $10.00 and $18.00 per share redemption trigger prices will be adjusted
(to the nearest cent) to be equal to 100% and 180% of the higher of the Market Value and the Newly Issued Price, respectively.
This may make it more difficult for us to complete an initial business combination with a target business.
We
may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants
worthless.
We
have the ability to redeem the outstanding Public Warrants at any time after they become exercisable and prior to their expiration,
at a price of $0.01 per warrant, provided that the closing price of our Class A common stock equals or exceeds $18.00 per share
(as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under
the heading “Description of Securities — Warrants — Public Stockholders’ Warrants — Anti-Dilution
Adjustments”) for any 20 trading days within a 30 trading-day period ending on the third trading day prior to proper notice
of such redemption and provided that certain other conditions are met. If and when the warrants become redeemable by us, we may
exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable
state securities laws. As a result, we may redeem the warrants as set forth above even if the holders are otherwise unable to
exercise the warrants. Redemption of the outstanding warrants could force you to (i) exercise your warrants and pay the exercise
price therefor at a time when it may be disadvantageous for you to do so, (ii) sell your warrants at the then-current market price
when you might otherwise wish to hold your warrants or (iii) accept the nominal redemption price which, at the time the outstanding
warrants are called for redemption, we expect would be substantially less than the market value of your warrants. None of the
Private Placement Warrants will be redeemable by us so long as they are held by our Sponsors or their permitted transferees.
In
addition, we have the ability to redeem the outstanding Public Warrants at any time after they become exercisable and prior to
their expiration, at a price of $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided
that the closing price of our Class A common stock equals or exceeds $10.00 per share (as adjusted for adjustments to the
number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “Description of
Securities — Warrants — Public Stockholders’ Warrants — Anti-Dilution Adjustments”) for any 20 trading
days within a 30 trading-day period ending on the third trading day prior to proper notice of such redemption and provided
that certain other conditions are met, including that holders will be able to exercise their warrants prior to redemption
for a number of shares of Class A common stock determined based on the redemption date and the fair market value of our Class
A common stock. The value received upon exercise of the warrants (i) may be less than the value the holders would have received
if they had exercised their warrants at a later time where the underlying share price is higher and (ii) may not compensate the
holders for the value of the warrants, including because the number of shares of Class A common stock received is capped at 0.361
shares of Class A common stock per warrant (subject to adjustment) irrespective of the remaining life of the warrants.
Our
warrants may have an adverse effect on the market price of our shares of Class A common stock and make it more difficult to effectuate
our initial business combination.
We
issued warrants to purchase 11,363,204 shares of Class A common stock as part of the units offered by this prospectus and, simultaneously
with the closing of the Public Offering, we issued in a private placement an aggregate of 5,945,281 warrants, each exercisable
to purchase one share of Class A common stock at $11.50 per share. In addition, if our Sponsors or an affiliate of our Sponsors
or certain of our officers and directors makes any working capital loans, such lender may convert those loans into up to an additional
1,000,000 Private Placement Warrants, at the price of $1.50 per warrant. To the extent we issue common stock to effectuate our
initial business combination, the potential for the issuance of a substantial number of additional shares of Class A common stock
upon exercise of these warrants could make us a less attractive acquisition vehicle to a target business. Such warrants, when
exercised, will increase the number of issued and outstanding shares of Class A common stock and reduce the value of the Class
A common stock issued to complete our initial business combination. Therefore, our warrants may make it more difficult to effectuate
our initial business combination or increase the cost of acquiring the target business.
Because
each unit contains one-third of one warrant and only a whole warrant may be exercised, the units may be worth less than units of other
special purpose acquisition companies.
Each
unit contains one-third of one warrant. Pursuant to the warrant agreement, no fractional warrants will be issued upon separation
of the units, and only whole units will trade. If, upon exercise of the warrants, a holder would be entitled to receive a fractional
interest in a share, we will, upon exercise, round down to the nearest whole number the number of shares of Class A common stock
to be issued to the warrant holder. We have established the components of the units in this way in order to reduce the dilutive
effect of the warrants upon completion of a business combination since the warrants will be exercisable in the aggregate for one-third
of the number of shares compared to units that each contain a whole warrant to purchase one share, thus making us, we believe,
a more attractive merger partner for target businesses. Nevertheless, this unit structure may cause our units to be worth less
than if it included a warrant to purchase one whole share.
The
grant of registration rights to our initial stockholders and holders of our Private Placement Warrants may make it more difficult
to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of
our shares of Class A common stock.
Pursuant
to an agreement entered into concurrently with the issuance and sale of the securities in the Public Offering, our initial stockholders,
the holders of our Private Placement Warrants, the holders of warrants that may be issued upon conversion of working capital loans
and their permitted transferees can demand that we register the shares of Class A common stock into which Founder Shares are convertible,
the Private Placement Warrants and the Class A common stock issuable upon exercise of the Private Placement Warrants or the Class
A common stock issuable upon conversion of warrants that may be issued upon conversion of working capital loans and any other
securities of the company acquired by them prior to the consummation of our initial business combination. We will bear the cost
of registering these securities. The registration and availability of such a significant number of securities for trading in the
public market may have an adverse effect on the market price of our Class A common stock. In addition, the existence of the registration
rights may make our initial business combination more costly or difficult to conclude. This is because the stockholders of the
target business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the
negative impact on the market price of our Class A common stock that is expected when the shares of common stock owned by our
initial stockholders, holders of our Private Placement Warrants or holders of our working capital loans or their respective permitted
transferees are registered.
You
may only be able to exercise your Public Warrants on a “cashless basis” under certain circumstances, and if you do
so, you will receive fewer shares of Class A common stock from such exercise than if you were to exercise such warrants for cash.
The
warrant agreement provides that in the following circumstances holders of warrants who seek to exercise their warrants will not
be permitted to do for cash and will, instead, be required to do so on a cashless basis in accordance with Section 3(a)(9) of
the Securities Act: (i) if the shares of Class A common stock issuable upon exercise of the warrants are not registered under
the Securities Act in accordance with the terms of the warrant agreement; and (ii) if we have so elected and the shares of Class
A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy
the definition of “covered securities” under Section 18(b)(1) of the Securities Act. If you exercise your Public Warrants
on a cashless basis under the circumstances described in clauses (i) and (ii) in the preceding sentence, you would pay the warrant
exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained by
dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the excess of
the “fair market value” of our shares of Class A common stock (as defined in the next sentence) over the exercise
price of the warrants by (y) the fair market value. The “fair market value” is the average reported closing price
of the shares of Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice
of exercise is received by the warrant agent or on which the notice of redemption is sent to the holders of warrants, as applicable.
As a result, you would receive fewer shares of Class A common stock from such exercise than if you were to exercise such warrants
for cash.
The
securities in which we invest the proceeds held in the Trust Account could bear a negative rate of interest, which could reduce
the interest income available for payment of taxes or reduce the value of the assets held in trust such that the per share redemption
amount received by stockholders may be less than $10.00 per share.
The
net proceeds of the Public Offering and certain proceeds from the sale of the Private Placement Warrants, in the amount of $340,896,110,
will be held in an interest-bearing Trust Account. The proceeds held in the Trust Account may only be invested in direct U.S.
government treasury obligations with a maturity of 185 days or less or in certain money market funds which invest only in direct
U.S. government treasury obligations. While short-term U.S. Treasury obligations currently yield a positive rate of interest,
they have briefly yielded negative interest rates in recent years. Central banks in Europe and Japan pursued interest rates below
zero in recent years, and the Open Market Committee of the Federal Reserve has not ruled out the possibility that it may in the
future adopt similar policies in the United States. In the event of very low or negative yields, the amount of interest income
(which we are permitted to use to pay our taxes and up to $100,000 of dissolution expenses) would be reduced. In the event that
we are unable to complete our initial business combination, our public stockholders are entitled to receive their pro-rata share
of the proceeds held in the Trust Account, plus any interest income (less up to $100,000 of interest to pay dissolution expenses).
If the balance of the Trust Account is reduced below $340,896,110 as a result of negative interest rates, the amount of funds
in the Trust Account available for distribution to our public stockholders may be reduced below $10.00 per share.
GENERAL
RISK FACTORS
We
are a blank check company with no operating history and no revenues, and you have no basis on which to evaluate our ability to
achieve our business objective.
We
are a blank check company incorporated under the laws of the State of Delaware with no operating results. Because we lack an operating
history, you have no basis upon which to evaluate our ability to achieve our business objective of completing our initial business
combination. We have no plans, arrangements or understandings with any prospective target business concerning a business combination
and may be unable to complete our initial business combination. If we fail to complete our initial business combination, we will
never generate any operating revenues.
Past
performance by our management team and their respective affiliates may not be indicative of future performance of an investment
in us or in the future performance of any business that we may acquire.
Information
regarding performance by, or businesses associated with, our management team or businesses associated with them is presented for
informational purposes only. Past performance by our management team or the other companies referred to in this prospectus is
not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able
to locate a suitable candidate for our initial business combination. You should not rely on the historical record of the performance
of our management team’s or businesses associated with them as indicative of our future performance of an investment in
us or the returns we will, or is likely to, generate going forward. An investment in us is not an investment in any of the companies
associated with our management team.
Cyber
incidents or attacks directed at us could result in information theft, data corruption, operational disruption and/or financial
loss.
We
depend on digital technologies, including information systems, infrastructure and cloud applications and services, including those
of third parties with which we may deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure,
or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary
information and sensitive or confidential data. As an early stage company without significant investments in data security protection,
we may not be sufficiently protected against such occurrences. We may not have sufficient resources to adequately protect against,
or to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination
of them, could have adverse consequences on our business and lead to financial loss.
We
are an emerging growth company and a smaller reporting company within the meaning of the Securities Act, and if we take advantage
of certain exemptions from disclosure requirements available to emerging growth companies or smaller reporting companies, this
could make our securities less attractive to investors and may make it more difficult to compare our performance with other public
companies.
We
are an “emerging growth company” within the meaning of the Securities Act, as modified by the JOBS Act, and we may
take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are
not emerging growth companies including, but not limited to, not being required to comply with the auditor internal controls attestation
requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our
periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive
compensation and stockholder approval of any golden parachute payments not previously approved. As a result, our stockholders
may not have access to certain information they may deem important. We could be an emerging growth company for up to five years,
although circumstances could cause us to lose that status earlier, including if the market value of our Class A common stock held
by non-affiliates equals or exceeds $700 million as of any June 30 before that time, in which case we would no longer be an emerging
growth company as of the following December 31. We cannot predict whether investors will find our securities less attractive because
we will rely on these exemptions. If some investors find our securities less attractive as a result of our reliance on these exemptions,
the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for
our securities and the trading prices of our securities may be more volatile.
Further,
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial
accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared
effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised
financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and
comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We
have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has
different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard
at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another
public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended
transition period difficult or impossible because of the potential differences in accounting standards used.
Additionally,
we are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take
advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements.
We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held
by non-affiliates equals or exceeds $250 million as of the prior June 30th, or (2) our annual revenues exceeded $100 million
during such completed fiscal year and the market value of our common stock held by non-affiliates equals or exceeds $700 million as of
the prior June 30th. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of
our financial statements with other public companies difficult or impossible.
Provisions
in our Charter and Delaware law may have the effect of discouraging lawsuits against our directors and officers.
Our
Charter requires, unless we consent in writing to the selection of an alternative forum, that (i) any derivative action or proceeding
brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other
employee to us or our stockholders, (iii) any action asserting a claim against us, our directors, officers or employees arising
pursuant to any provision of the DGCL or our Charter or bylaws, or (iv) any action asserting a claim against us, our directors,
officers or employees governed by the internal affairs doctrine may be brought only in the Court of Chancery in the State of Delaware,
except any claim (A) as to which the Court of Chancery of the State of Delaware determines that there is an indispensable party
not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction
of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a
court or forum other than the Court of Chancery, or (C) for which the Court of Chancery does not have subject matter jurisdiction.
If an action is brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of
process on such stockholder’s counsel. Although we believe this provision benefits us by providing increased consistency
in the application of Delaware law in the types of lawsuits to which it applies, a court may determine that this provision is
unenforceable, and to the extent it is enforceable, the provision may have the effect of discouraging lawsuits against our directors
and officers, although our stockholders will not be deemed to have waived our compliance with federal securities laws and the
rules and regulations thereunder.
Notwithstanding
the foregoing, our Charter provides that the exclusive forum provision will not apply to suits brought to enforce a duty or liability
created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. Section 27 of the Exchange
Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act
or the rules and regulations thereunder. Additionally, unless we consent in writing to the selection of an alternative forum,
the federal courts shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under
the Securities Act against us or any of our directors, officers, other employees or agents. Any person or entity purchasing or
otherwise acquiring any interest in our securities shall be deemed to have notice of and consented to these provisions. Although
we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits
to which it applies, the provision limit our stockholders’ ability to obtain a favorable judicial forum for disputed with
us and may have the effect of discouraging lawsuits against our directors and officers.
Additionally,
unless we consent in writing to the selection of an alternative forum, the federal courts shall be the exclusive forum for the
resolution of any complaint asserting a cause of action arising under the Securities Act against us or any of our directors, officers,
other employees or agents. Section 22 of the Securities Act, however, created concurrent jurisdiction for federal and state courts
over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.
Accordingly, there is uncertainty as to whether a court would enforce such provisions, and the enforceability of similar choice
of forum provisions in other companies’ charter documents has been challenged in legal proceedings. While the Delaware courts
have determined that such exclusive forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim
in a venue other than those designated in the exclusive forum provisions, and there can be no assurance that such provisions will
be enforced by a court in those other jurisdictions. Any person or entity purchasing or otherwise acquiring any interest in our
securities shall be deemed to have notice of an consented to these provisions; however, we note that investors cannot waive compliance
with the federal securities laws and the rules and regulations thereunder.
Although
we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits
to which it applies, the provision may limit our stockholders’ ability to obtain a favorable judicial forum for disputed
with us and may have the effect of discouraging lawsuits against our directors and officers.