Some statements contained in this Annual Report
on Form 10-K (this “Annual Report”) are forward-looking in nature. Our forward-looking statements include, but are not limited
to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future.
In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including
any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,”
“could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,”
“possible,” “potential,” “predict,” “project,” “should,” “would”
and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not
forward-looking. Forward-looking statements in this Annual Report may include, for example, statements about:
The forward-looking statements contained in this
Annual Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. There
can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve
a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance
to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include,
but are not limited to, those factors described under the heading “Risk Factors.” Should one or more of these risks or uncertainties
materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these
forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required under applicable securities laws.
ITEM
1. BUSINESS
We are a blank check company incorporated as a
Cayman Islands exempted company. We were formed for the purpose of entering into a merger, capital share exchange, asset acquisition,
share purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities, which
we refer to as a “target business.” While we may pursue an initial business combination with any target business and in any
sector or geographical location, we intend to focus our search on targets in energy transition technologies, such as battery materials,
energy storage, EV infrastructure and advanced recycling in emerging/frontier countries including the CIS, South and South-East Asia
and MENA regions.
On September 8, 2021, the Company consummated
an initial public offering of 15,000,000 units at $10.00 per unit and the sale of 8,400,000 warrants at a price
of $1.00 per private warrant in a private placement to the Company’s sponsor, Oxus Capital Pte. Ltd and its underwriters that
closed simultaneously with the closing of the initial public offering. The Company has listed the units on the Nasdaq Capital Market (“Nasdaq”).
On September 13, 2021, the underwriters exercised their over-allotment option in full, according
to which the Company consummated the sale of an additional 2,250,000 units, at $10.00 per unit, and the sale of an additional 900,000 private
warrants, at $1.00 per private warrant, generating total gross proceeds of $23.40 million.
A total of $175,950,000 of the net proceeds from
the initial public offering (including the additional units) and the sale of private placement warrants and additional private placement
warrants was deposited in a trust account established for the benefit of the Company’s public stockholders.
Our Founder and Management Team
We seek to capitalize on the substantial deal
sourcing, investing and operating expertise of our founder, non-executive Chairman and director, Kenges Rakishev, our Chief Executive
Officer, Kanat Mynzhanov, and our Chief Financial Officer, Askar Mametov, as well as our independent directors, Shiv Vikram Khemka, Christophe
Charlier and Sergei Ivashkovsky.
Mr. Rakishev is a global investor and entrepreneur
who focuses on acquiring and investing in businesses that can benefit from his group’s operating expertise. Over the course of his
career, Mr. Rakishev has acquired and directly or indirectly invested in more than 50 businesses in metals & mining, oil,
petrochemical, banking, fintech, information technology, ecommerce, logistics and insurance industries, including a current portfolio
of ten active companies worldwide. He is the sole shareholder and chief executive officer of Fincraft (listed on the Kazakhstan Stock
Exchange since 2019), chairman of the board of Fincraft Resources JSC (formerly SAT & Company)(listed on the Kazakhstan Stock
Exchange since 2008), chairman of the board of Battery Metals Technologies Ltd., director of Evoshare Limited, president of Kazakhstan
Boxing Federation, independent director of Satbayev Kazakh National Technical University, co-founder of Saby Charitable Foundation,
and was one of the early investors in StoreDot and Net Element (NASDAQ: NETE). Mr. Rakishev was ranked 12th on
the Forbes list of the most influential persons in Kazakhstan in 2020.
Mr. Rakishev made a significant investment
in Net Element in 2012. Net Element is a global technology-driven company specializing in mobile payments and value-added transactional
services. Net Element owns and operates a global mobile payments and transactional processing provider, TOT Group. TOT Group companies
include Unified Payments, ranked as one of the fastest growing companies in North America on Deloitte’s 2018 Technology Fast 500™,
Aptito, a next generation cloud-based point of sale payments platform and Payonline, fully-integrated, processor agnostic electronic
commerce platform. In 2020, Net Element announced the execution of a definitive agreement to merge with privately-held Mullen, a
Southern California-based electric vehicle company.
In 2013, Singulariteam Fund, a venture capital
fund owned by one of Mr. Rakishev’s group’s companies, was an early investor in StoreDot. StoreDot is a pioneer of extreme
fast charging (XFC) batteries that overcome the critical barrier to mainstream EV adoption — range and charging anxiety. The
company has revolutionized the conventional Li-ion battery by designing and synthesizing proprietary organic and inorganic compounds,
making it possible to fully charge an EV in just five minutes. The company was named “the pioneer of 2020” by BNEF, as one
of ten game-changing technology companies creating a more sustainable future.
Mr. Rakishev is a significant shareholder
and Chairman of Fincraft Resources JSC, which has expertise building, investing and operating internationally in the natural resources
and disruptive technology industries. Through its subsidiary Battery Metals Technologies Ltd., the company is targeting metals necessary
for electrification (in particular, nickel, cobalt and lithium) and has a significant nickel opportunity project in Kazakhstan. Kazakhstan
is strategically located, linking China and South Asia with Russia and Western Europe by road, rail and port, and therefore is of great
importance to China’s “Belt and Road” strategy. Fincraft Resources JSC recognized the potential to produce nickel from
laterite ores of the Gornostaevskoe deposit using in-situ leaching (ISL) techniques, which offers significant economic, environmental
and ecological advantages over conventional mining by extracting metals from the ground without physically removing the rock in which
they are found. As a result, little or no tailing or waste rock is generated. In addition, ISL allows for increasing and decreasing production
output more cost effectively than conventional mining.
From 2013 to 2018, Mr. Rakishev was a non-executive director
of Central Asia Metals Plc (AIM: CAML). In 2014, Mr Rakishev became a major shareholder of BTA, which is currently a subsidiary of Fincraft.
As of April 2021, Fincraft has over $1.2 billion in total assets. From 2015 to 2017, Mr. Rakishev was a controlling shareholder
and served as the chairman of Kazkommertsbank JSC, the largest Kazakh commercial bank. From 2017 to 2019, Mr. Rakishev was a major
shareholder of Petropavlovsk Plc., a member of London’s FTSE 250 index and is one of the five largest gold mining companies in Russia.
In these positions, he offered support on strategic development, including helping to resolve management conflicts as well as short-term liquidity
issues.
Mr. Rakishev is an active investor in start-ups that
are developing some of the most disruptive and impressive technologies today, from EV battery technology, mobile payments, artificial
intelligence and augmented reality to robotics and healthcare technology. He helps to establish an entrepreneurial environment as a foundation
for growth, while offering support, resources, and advice.
In addition to Mr. Rakishev, we expect to
benefit from the experience and networks of the following members of our management team:
Kanat Mynzhanov has served as our Chief Executive
Officer and director since our inception in February 2021. Mr. Mynzhanov co-founded Bellprescot Ltd. and Bellprescot in
September 2016. He served as the chief investment officer of Bellprescot from 2016 to 2020 and operated Bellprescot’s fund,
BP. BP’s primary focus of investments is technology driven public companies with leading and disruptive products and service, including
internet of things and cloud, autonomous driving, artificial intelligence, machine learning, semiconductors, cybersecurity and robotics.
Mr. Mynzhanov founded D23 in June 2020 to manage private equity deals. Prior to founding BP and D23, Mr. Mynzhanov served
as the head of investments at Kazatomprom-Damu, an investment subsidiary of NAC, where he led and mentored a team of highly skilled investment
managers responsible for mergers and acquisitions, joint ventures and business development across metals & mining, rare metals
and alternative energy industries. Mr. Mynzhanov joined NAC in 2014 as an investment manager and during his time at NAC he oversaw
numerous projects and established strong connections with some of the largest global firms. Over the years Mr. Mynzhanov consulted
for various firms, including those in the metals and mining sector, on raising capital through initial public offerings, as well as restructuring
and various business developments.
Askar Mametov has served as our Chief Financial
Officer since our inception in February 2021. Mr. Mametov has over 15 years of executive experience in mining, oil and
gas, infrastructure and transportation industries with a thorough understanding of financial reporting (US GAAP and IFRS), taxation and
accounting, financial planning and analysis. Previously, Mr. Mametov served as chief financial officer of KM Gold Inc., a public
Kazakh gold mining company (KASE: KMGD) from August 2016 until October 2019. He led the public listing of the company on the
Kazakhstan Stock Exchange in 2016. Prior to that, Mr. Mametov served as financial controller of Sequa Petroleum Kazakhstan, a subsidiary
of Sequa Petroleum, an oil and gas company listed on Euronext Access (EPA: MLSEQ), from January 2014 to July 2016. From 2007
to 2014, Mr. Mametov served in multiple roles at Caspian Services Inc. (NASDAQ: CSSV), including management reporting, US GAAP financial
reporting, as well as IFRS financial reporting. In 2007, Mr. Mametov worked at Beeline Kazakhstan, a subsidiary of VEON (NASDAQ:
VEON). From 2005 to 2007, Mr. Mametov served as financial reporting specialist and consortium accountant for PetroKazakhstan Inc.
(TSX: PKZ), a Canadian oil company. Mr. Mametov is a member of IMA (Institute of Management Accountants) and since 2014, has served
as the President of Kazakhstan Chapter of IMA.
We have a highly accomplished team of independent
directors who are experienced in executive leadership, company governance and operations oversight. Our board members have served as directors,
partners, executives and advisors for a number of publicly-traded companies. We believe that our independent directors’ combination
of relationships, experience and expertise in a number of sectors (natural resources, green infrastructure, high technology, solid state
batteries, financial services, telecom) and markets (India, Russia, the Middle East, Europe, North America, the CIS and other emerging
markets) puts us in a strong position to complete a business combination:
Shiv Vikram Khemka is one of our independent
directors. Mr. Khemka has served as a vice-chairman of SUN Group, a 120-year-old family enterprise comprised of both operating
and investment companies, since 1990. SUN Group is active in asset management, natural resources, green infrastructure and high technology.
SUN co-founded SUN Mobility, an energy tech company focused on becoming a leader in EV energy. SUN is also a significant investor
in a leading EV solid state battery manufacturer. The group has been active in various regions around the world, including India, Russia,
the Middle East, Central and South-East Asia. Mr. Khemka is the chairman of the Entrepreneurship Sports Generation and executive
chairman of the Global Education and Leadership Foundation. He is currently a member of the board of governors at Junior Achievement Worldwide
and is a member of the Leadership Council at the Brooking Centre for Universal Education. The World Economic Forum elected Mr. Khemka
a “Global Leader for Tomorrow” and he was also a member of the organization’s Global Agenda Council on Education. He
has served on both the Brown University and Yale University’s President’s Councils. Mr. Khemka has also served as a board
member on the Stanford Philanthropy and Civic Society (PACS) centre and was advisory board member of the Davis Center for Russian and
Eurasian studies at Harvard University. He is currently a founding member of V20, a global community of values experts and practitioners
that engage with G20, and serves as the chairman of Aikido Aikikai Foundation of India. Mr. Khemka was awarded the Dr. Jean
Mayer Global Citizenship Award from Tufts University, and the Outstanding Contribution to Education Prize and the India Alumni Award from
the Wharton School of Business.
Christophe Charlier is one of our independent
directors. Mr. Charlier is an international financier with over 25 years of experience in investment banking, private equity
and international management. Throughout his career he has acted as principal or advised on a number of landmark transactions in the telecom,
financial services, natural resources and sports and entertainment industries across developed and emerging markets. He has served as
an independent director of La Française de l’Energie, a French gas production company since April 2016, and chairman
of Pure Grass Films, a UK-based film and TV series production company, since 2012. Mr. Charlier served as chairman of the board
of directors of Renaissance Capital, a leading investment bank focused on emerging and frontier markets, from April 2017 to March 2020.
As chairman, Mr. Charlier coordinated the work of Renaissance Capital’s board of directors and oversaw strategic development,
the global brand, and relationships with key clients and stakeholders globally, as well as compliance with listing requirements of the
Astana International Exchange (AIX) in Kazakhstan. Previously, Mr. Charlier served as deputy CEO of Onexim Group, a leading
private equity fund based in Moscow from September 2008 to June 2014. In this capacity, he served on the boards of directors
of several of Russia’s largest companies, including RusAl, Polyus Gold, Quadra-Power Generation, and RBC. He also acted as
chairman of the NBA’s Brooklyn Nets franchise from 2010 to 2014. Prior to that from February 2002 to March 2004, Mr. Charlier was
director of strategic development of Norilsk Nickel, leading its acquisition of strategic stakes in Stillwater Mining Company and Gold
Fields. He started his investment banking career in 1995 at JPMorgan in the M&A Group in NY.
Sergei Ivashkovsky is one of our independent directors.
Mr. Ivashkovsky has over 16 years of experience in investment management in public and private equity markets in the CIS and
other counties in Eastern Europe, in restructuring and turnaround projects for technology companies and in distressed assets in Russia,
and participated in a significant number of deals in industrial, consumer and banking sector. In October 2019, Mr. Ivashkovsky
founded an investment company Eurasia Investment Partners to advise private investors in LBO and private equity transactions. From May 2018
to October 2019, Mr. Ivashkovsky served as a managing director of the distressed assets bank TRUST, launched by the Central
Bank of Russia along with McKinsey advisory to consolidate $40 billion of non-performing corporate loans. From 2013 until April 2018,
he served as a managing director of Rusnano, a leading state-owned tech fund in Russia, and Gazprombank, a leading private bank in
Russia, responsible for a number of turnaround projects in industrial technologies, fintech and artificial intelligence. From 2006 to
2012, Mr. Ivashkovsky served as a senior analyst and co-portfolio manager of Prosperity Capital and East Capital, the leading
Swedish asset management companies in Russia, CIS and Eastern Europe with long-only and special situation funds. From 2004 to 2006,
he served as an analyst and junior portfolio manager in Rosbank AM, an asset management start-up of INTERROS, one of the largest
financial and industrial groups in Russia.
Notwithstanding the foregoing, the past successes
of Mr. Rakishev and our other officers and directors, and their respective affiliates is not a guarantee that we will be able to
identify a suitable candidate for our initial business combination or realize success with respect to any business combination we may
consummate. You should not rely on the historical record of such individuals’ or entity’s performance as indicative of our
future performance. Additionally, in the course of their respective careers, members of our management team may have been involved in
businesses and deals that were unsuccessful. In addition, our officers and directors may have conflicts of interest with other entities
to which they owe fiduciary or contractual obligations with respect to initial business combination opportunities.
Business Strategy
Our acquisition and value creation strategy is
to identify and complete the initial business combination with a target in an industry that complements the experience and expertise of
our founder and management team. We believe our founder’s broad experience owning and operating private and public companies positions
us for a successful business combination. We also believe the resources and experience of our management team will provide us with an
in-depth understanding of targets located in the CIS and other countries in South and South-East Asia and MENA regions, operating
in energy transition technologies.
We expect to distinguish ourselves by leveraging
our extensive internal and external network of relationships to create a significant pipeline of business combination opportunities. We
have significant experience dealing with key stakeholders, including shareholders, administrators, governmental agencies as well as equity
sponsors, lending institutions, family offices, investment banks, restructuring advisers, attorneys, brokers and employees built over
many years of investing and operating businesses in different regions.
We believe our sponsor’s and management
team’s deal sourcing, investing and operating expertise, as well as their extensive network of contacts in our focus regions will
uniquely position us to take advantage of positive trends in our target industries. We believe this expertise and network of contacts
will provide us access to a number of potential target businesses that could be attractive public companies in the United States.
We will evaluate a wide-range of organic
and strategic growth opportunities to identify synergies, bolster a target’s competitive position and develop new areas of growth
for it. We also intend to leverage our management team’s vision and substantial expertise in building vertically-integrated businesses
when possible.
Acquisition Criteria
We intend to acquire a company that we believe
can offer an attractive risk-adjusted returns for shareholders. Fundamental analysis, including historical and projected financial
and operating data, extensive financial modelling and in-depth market risks reviews are the core to our investment strategy, as well
as extensive legal and intellectual properties due diligence to evaluate a target company and to complete a thorough analysis of the potential
impact of a business combination.
We intend to acquire companies or assets that
we believe have some or all of the following attributes:
| ● | The potential to benefit from being publicly traded with access
to the public capital markets and reduced cost of equity and debt capital to pursue further growth opportunities; |
| ● | A professional management team whose interests are aligned
with our investors (we may enhance the capabilities of the target’s business team by recruiting talent through our network of contacts); |
| ● | The potential to grow organically as well as through acquisitions; |
| ● | A defensible position within a target market as a result of
a differentiated technology or other competitive advantages; |
| ● | A proven business model; |
| ● | The collective capabilities of our management can be leveraged
to tangibly improve the operations and market position of the target; and |
| ● | A history of strong operating and financial results with proven
track records. |
Given our management team’s extensive experience
investing in a target’s industries, we expect that we may be familiar with the prospective target’s end-market, competitive
landscape and business model. We intend to construct an operating and financial plan designed to significantly increase shareholder value.
When necessary, we intend to assemble a team of industry and financial experts to supplement the management teams’ efforts. We expect
to demonstrate to the target and its shareholders that we have the resources and expertise to provide the strategic and operational direction
necessary to grow the business and improve the overall strategic prospects for the combined companies.
These criteria and guidelines are not intended
to be exhaustive. Any evaluation relating to the merits of an initial business combination may be based, to the extent relevant, on these
general criteria and guidelines as well as other considerations, factors, guidelines, and criteria that our management team may deem relevant.
In the event that we decide to enter into a business combination with a target business that does not meet the above criteria and guidelines,
we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to
our initial business combination, whichwould be in the form of proxy solicitation or tender offer materials, as applicable, that we would
file with the SEC.
In evaluating a prospective target business, we
expect to conduct a thorough due diligence review which may encompass, among other things, meetings with incumbent management and employees,
document reviews, inspection of facilities, as well as a review of financial and other information that will be made available to us.
We will also utilize our operational and capital allocation experience.
We are not prohibited from pursuing an initial
business combination with a business that is affiliated with our sponsor, officers, or directors. In the event we seek to complete our
initial business combination with a business that is affiliated with our sponsor, officers or directors, we, or a committee of independent
directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation
opinions that our initial business combination is fair to our company from a financial point of view.
Members of our management team will directly or
indirectly own founder shares and/or private warrants following the initial public offering and, accordingly, may have a conflict
of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business
combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business
combination if the retention or resignation of any such officers and directors is included by a target business as a condition to our
initial business combination.
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 entities. Accordingly, if any of our officers
or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary
or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity.
We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our
ability complete our business combination. Our amended and restated memorandum and articles of association 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 our company and such opportunity is one we are legally and contractually permitted
to undertake and would otherwise be reasonable for us to pursue.
Effecting a Business Combination
General
We are not presently engaged in, and we will not
engage in, any substantive commercial business for an indefinite period of time following the initial public offering. We intend to utilize
cash derived from the proceeds of the initial public offering and the private placement of private warrants, our ordinary shares, debt
or a combination of these in effecting a business combination which has not yet been identified. A business combination may involve the
acquisition of, or merger with, a company which does not need substantial additional capital, but which desires to establish a public
trading market for its shares, while avoiding what it may deem to be adverse consequences of undertaking a public offering itself. These
include time delays, significant expense, loss of voting control and compliance with various federal and state securities laws. In the
alternative, we may seek to consummate a business combination with a company that may be financially unstable or in its early stages of
development or growth. While we may seek to effect simultaneous business combinations with more than one target business, we will probably
have the ability, as a result of our limited resources, to effect only a single business combination.
We Have Not Identified a Target Business
To date, we have not selected any target business
on which to concentrate our search for a business combination. We cannot assure you that we will be able to locate a target business or
that we will be able to engage in a business combination with a target business on favorable terms or at all.
Subject to our management team’s pre-existing fiduciary
obligations and the fair market value requirement described below, we have virtually unrestricted flexibility in identifying and selecting
a prospective acquisition candidate. We have not established any specific attributes or criteria (financial or otherwise) for prospective
target businesses other than as described above. Accordingly, there is no basis for investors in the initial public offering to evaluate
the possible merits or risks of the target business with which we may ultimately complete a business combination. 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.
Sources of Target Businesses
While we have not yet selected a target business
with which to consummate our initial business combination, we believe based on our management’s business knowledge and past experience
that there are numerous potential candidates. We expect that our principal means of identifying potential target businesses will be through
the extensive contacts and relationships of our sponsor, initial shareholders, officers and directors. While our officers and directors
are not required to commit any specific amount of time in identifying or performing due diligence on potential target businesses, our
officers and directors believe that the relationships they have developed over their careers and their access to our sponsor’s contacts
and resources will generate a number of potential business combination opportunities that will warrant further investigation. We also
anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment bankers,
venture capital funds, private equity funds, leveraged buyout funds, management buyout funds and other members of the financial community.
Target businesses may be brought to our attention by such unaffiliated sources as a result of being solicited by us through calls or mailings.
These sources may also introduce us to target businesses they think we may be interested in on an unsolicited basis, since many of these
sources will have read this Annual Report and know what types of businesses we are targeting.
Our officers and directors must present to us
all target business opportunities that have a fair market value of at least 80% of the assets held in the trust account at the time of
the agreement to enter into the initial business combination, subject to any pre-existing fiduciary or contractual obligations. While
we do not presently anticipate engaging the services of professional firms or other individuals that specialize in business acquisitions
on any formal basis (other than EarlyBirdCapital and Sova Capital as described elsewhere in this Annual Report), we may engage these firms
or other individuals in the future, in which event we may pay a finder’s fee, consulting fee or other compensation to be determined
in an arm’s length negotiation based on the terms of the transaction. In no event, however, will our sponsor, initial shareholders,
officers, directors or their respective affiliates be paid any compensation or fees of any kind, including finder’s, consulting
fees and other similar fees, prior to, or for any services they render in order to effectuate, the consummation of an initial business
combination (regardless of the type of transaction that it is), other than the $10,000 per month administrative fee, the repayment of
up to $300,000 in loans from our sponsor and reimbursement of any out-of-pocket expenses. Our audit committee will review and approve
all reimbursements and payments made to our sponsor, initial shareholders, officers, directors or our or their respective affiliates,
with any interested director abstaining from such review and approval.
We have no present intention to enter into a business
combination with a target business that is affiliated with any of our officers, directors or sponsor. However, we are not restricted from
entering into any such transactions and may do so if (i) such transaction is approved by a majority of our disinterested independent
directors and (ii) we obtain an opinion from an independent investment banking firm, or another independent entity that commonly
renders valuation opinions, that the business combination is fair to our unaffiliated shareholders from a financial point of view.
Selection of a Target Business and Structuring
of a Business Combination
Subject to our management team’s pre-existing fiduciary
obligations and the limitations that a target business have a fair market value of at least 80% of the balance in the trust account at
the time of the execution of a definitive agreement for our initial business combination, as described below in more detail, and that
we must acquire a controlling interest in the target business, our management will have virtually unrestricted flexibility in identifying
and selecting a prospective target business. We have not established any specific attributes or criteria (financial or otherwise) for
prospective target businesses other than as described above under the caption “Investment Criteria.” In evaluating
a prospective target business, our management may consider a variety of factors, including one or more of the following:
| ● | financial condition and results of operation; |
| ● | brand recognition and potential; |
| ● | experience and skill of management and availability of additional
personnel; |
| ● | stage of development of the products, processes or services; |
| ● | existing distribution and potential for expansion; |
| ● | degree of current or potential market acceptance of the products,
processes or services; |
| ● | proprietary aspects of products and the extent of intellectual
property or other protection for products or formulas; |
| ● | impact of regulation on the business; |
| ● | regulatory environment of the industry; |
| ● | costs associated with effecting the business combination; |
| ● | industry leadership, sustainability of market share and attractiveness
of market industries in which a target business participates; and |
| ● | macro competitive dynamics in the industry within which the
company competes. |
These criteria are not intended to be exhaustive.
Any evaluation relating to the merits of a particular business combination will be based, to the extent relevant, on the above factors
as well as other considerations deemed relevant by our management in effecting a business combination consistent with our business objective.
In evaluating a prospective target business, we will conduct an extensive due diligence review which will encompass, among other things,
meetings with incumbent management and inspection of facilities, as well as review of financial and other information which is made available
to us. This due diligence review will be conducted either by our management or by unaffiliated third parties we may engage, although we
have no current intention to engage any such third parties.
The time and costs required to select and evaluate
a target business and to structure and complete the business combination cannot presently be ascertained with any degree of certainty.
Any costs incurred with respect to the identification and evaluation of a prospective target business with which a business combination
is not ultimately completed will result in a loss to us and reduce the amount of capital available to otherwise complete a business combination.
Fair Market Value of Target Business
The Nasdaq listing rules require that the target
business or businesses that we acquire must collectively have a fair market value equal to at least 80% of the balance of the funds in
the trust account at the time of the execution of a definitive agreement for our initial business combination. Notwithstanding the foregoing,
if we are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% fair market value test.
We currently anticipate structuring a business
combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial
business combination where we merge directly with the target business or a newly formed subsidiary or where we acquire less than 100%
of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders 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 shareholders 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 could acquire a 100% controlling interest in the target; however, as a result of the issuance
of a substantial number of new shares, our shareholders 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 trust account balance test.
The fair market value of the target will be determined
by our board of directors 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). The proxy solicitation materials or tender offer documents used by us in connection with
any proposed transaction will provide public shareholders with our analysis of the fair market value of the target business, as well as
the basis for our determinations. If our board is not able to independently determine that the target business has a sufficient fair market
value, we will obtain an opinion from an unaffiliated, independent investment banking firm, or another independent entity that commonly
renders valuation opinions, with respect to the satisfaction of such criteria. We will not be required to obtain an opinion from an investment
banking firm as to the fair market value if our board of directors independently determines that the target business complies with the
80% threshold.
Lack of Business Diversification
We may seek to effect a business combination with
more than one target business, although we expect to complete our business combination with just one business. Therefore, at least initially,
the prospects for our success may be entirely dependent upon the future performance of a single business operation. Unlike other entities
which may have the resources to complete several business combinations of entities operating in multiple industries or multiple areas
of a single industry, it is probable that we will not have the resources to diversify our operations or benefit from the possible spreading
of risks or offsetting of losses. By consummating a business combination with only a single entity, our lack of diversification may:
| ● | subject us to numerous economic, competitive and regulatory
developments, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent
to a business combination, and |
| ● | result in our dependency upon the performance of a single
operating business or the development or market acceptance of a single or limited number of products, processes or services. |
If we determine to simultaneously acquire several
businesses and such businesses 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 acquisitions, which may make it more difficult for us, and delay our
ability, to complete the business combination. With multiple acquisitions, 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.
Limited Ability to Evaluate the Target Business’
Management
Although we intend to scrutinize the management
of a prospective target business when evaluating the desirability of effecting a business combination, we cannot assure you that our assessment
of the target business’ management will prove to be correct. In addition, we cannot assure you that the future management will have
the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future role of our officers and directors,
if any, in the target business following a business combination cannot presently be stated with any certainty. While it is possible that
some of our key personnel will remain associated in senior management or advisory positions with us following a business combination,
it is unlikely that they will devote their full-time efforts to our affairs subsequent to a business combination. Moreover, they
would only be able to remain with the company after the consummation of a business combination 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 them to receive compensation in the form of cash payments and/or our securities for
services they would render to the company after the consummation of the business combination. While the personal and financial interests
of our key personnel may influence their motivation in identifying and selecting a target business, their ability to remain with the company
after the consummation of a business combination will not be the determining factor in our decision as to whether or not we will proceed
with any potential business combination. Additionally, we cannot assure you that our officers and directors will have significant experience
or knowledge relating to the operations of the particular target business.
Following a business combination, we may seek
to recruit additional managers to supplement the incumbent management of the target business. We cannot assure you that we will have the
ability to recruit additional managers, or that any such additional managers we do recruit will have the requisite skills, knowledge or
experience necessary to enhance the incumbent management.
Shareholders May Not Have the Ability to
Approve an Initial Business Combination
In connection with any proposed business combination,
we will either (1) seek shareholder approval of our initial business combination at a meeting called for such purpose at which shareholders
may seek to convert their shares, regardless of whether they vote for or against the proposed business combination or don’t vote
at all, into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), or (2) provide
our shareholders with the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a shareholder
vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable),
in each case subject to the limitations described herein. The decision as to whether we will seek shareholder approval of a proposed business
combination or will allow shareholders 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 shareholder approval. If we determine to engage in a tender offer, such tender offer will be structured so that each shareholder
may tender all of his, her or its shares rather than some pro rata portion of his, her or its shares. In that case, we will file tender
offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination
as is required under the SEC’s proxy rules. Whether we seek shareholder approval or engage in a tender offer, we will consummate
our initial business combination only if we have net tangible assets of at least $5,000,001 either immediately prior to or upon consummation
of such business combination and, if we seek shareholder approval, a majority of the outstanding ordinary shares voted are voted in favor
of the business combination.
We chose our net tangible asset threshold of $5,000,001
to ensure that we would avoid being subject to Rule 419 promulgated under the Securities Act. However, if we seek to consummate an
initial business combination with a target business that imposes any type of working capital closing condition or requires us to have
a minimum amount of funds available from the trust account upon consummation of such initial business combination, we may need to have
more than $5,000,001 in net tangible assets upon consummation and this may force us to seek third party financing which may not be available
on terms acceptable to us or at all. As a result, we may not be able to consummate such initial business combination and we may not be
able to locate another suitable target within the applicable time period, if at all. Public shareholders may therefore have to wait until
after March 8, 2023 in order to be able to receive a pro rata share of the trust account.
Our sponsor, initial shareholders, officers and
directors have agreed (1) to vote any ordinary shares owned by them in favor of any proposed business combination, (2) not to
convert any ordinary shares in connection with a shareholder vote to approve a proposed initial business combination and (3) not
sell any ordinary shares in any tender in connection with a proposed initial business combination.
None of our officers, directors, sponsor, initial
shareholders or their affiliates has indicated any intention to purchase units or Class A ordinary shares in the initial public offering
or from persons in the open market or in private transactions. However, if we hold a meeting to approve a proposed business combination
and a significant number of shareholders vote, or indicate an intention to vote, against such proposed business combination or that they
wish to convert their shares, our officers, directors, sponsor, initial shareholders or their affiliates could make such purchases in
the open market or in private transactions in order to influence the vote and reduce the number of conversions. Notwithstanding the foregoing,
our officers, directors, sponsor, initial shareholders and their affiliates will not make purchases of ordinary shares if the purchases
would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act, which are rules designed to stop potential manipulation
of a company’s shares.
Conversion Rights
At any meeting called to approve an initial business
combination, public shareholders may seek to convert their shares, regardless of whether they vote for or against the proposed business
combination or do not vote at all, into their pro rata share of the aggregate amount then on deposit in the trust account as of two business
days prior to the consummation of the initial business combination, less any taxes then due but not yet paid. Alternatively, we may provide
our public shareholders with the opportunity to sell their Class A ordinary shares to us through a tender offer (and thereby avoid
the need for a shareholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account,
less any taxes then due but not yet paid.
Our sponsor, initial shareholders and our officers
and directors will not have conversion rights with respect to any ordinary shares owned by them, directly or indirectly, whether acquired
prior to the initial public offering or purchased by them in the initial public offering or in the aftermarket. In addition, the holders
of the underwriter founder shares have agreed to waive their conversion rights with respect to the underwriter founder shares they hold.
We may require public shareholders, whether they
are a record holder or hold their shares in “street name,” to either (i) tender their certificates to our transfer agent
or (ii) deliver their shares to the transfer agent electronically using Depository Trust Company’s DWAC (Deposit/Withdrawal
At Custodian) System, at the holder’s option, in each case prior to a date set forth in the proxy materials sent in connection with
the proposal to approve the business combination.
There is a nominal cost associated with the above-referenced delivery
process and the act of certificating the shares or delivering them through the DWAC System. The transfer agent will typically charge the
tendering broker a nominal amount and it would be up to the broker whether or not to pass this cost on to the holder. However, this fee
would be incurred regardless of whether or not we require holders seeking to exercise conversion rights. The need to deliver shares is
a requirement of exercising conversion rights regardless of the timing of when such delivery must be effectuated. However, in the event
we require shareholders seeking to exercise conversion rights prior to the consummation of the proposed business combination and the proposed
business combination is not consummated this may result in an increased cost to shareholders.
Any proxy solicitation materials we furnish to
shareholders in connection with a vote for any proposed business combination will indicate whether we are requiring shareholders to satisfy
such certification and delivery requirements. Accordingly, a shareholder would have from the time the shareholder received our proxy statement
up until the vote on the proposal to approve the business combination to deliver his shares if he wishes to seek to exercise his conversion
rights. This time period varies depending on the specific facts of each transaction. However, as the delivery process can be accomplished
by the shareholder, whether or not he is a record holder or his shares are held in “street name,” in a matter of hours by
simply contacting the transfer agent or his broker and requesting delivery of his shares through the DWAC System, we believe this time
period is sufficient for an average investor. However, we cannot assure you of this fact. Please see the risk factor titled “In
connection with any shareholder meeting called to approve a proposed initial business combination, we may require shareholders who wish
to convert their shares in connection with a proposed business combination to comply with specific requirements for conversion that may
make it more difficult for them to exercise their conversion rights prior to the deadline for exercising their rights” for further
information on the risks of failing to comply with these requirements.
Any request to convert such shares once made,
may be withdrawn at any time up to the vote on the proposed business combination or the expiration of the tender offer. Furthermore, if
a holder of public shares delivered his certificate in connection with an election of their conversion and subsequently decides prior
to the applicable date not to elect to exercise such rights, he may simply request that the transfer agent return the certificate (physically
or electronically).
If the initial business combination is not approved
or completed for any reason, then our public shareholders who elected to exercise their conversion rights would not be entitled to convert
their shares for the applicable pro rata share of the trust account. In such case, we will promptly return any shares delivered by public
holders.
Limitation on Conversion upon Completion
of our Initial Business Combination if We Seek Shareholder Approval
Notwithstanding the foregoing, if we seek shareholder
approval of our initial business combination and we do not conduct conversions in connection with our initial business combination pursuant
to the tender offer rules, our amended and restated memorandum and articles of association provides that a public shareholder, together
with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group”
(as defined under Section 13 of the Exchange Act), will be restricted from seeking conversion rights with respect to more than an
aggregate of 15% of the shares sold in the initial public offering, which we refer to as the “Excess Shares.” We believe this
restriction will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their
ability to exercise their conversion 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
shareholder holding more than an aggregate of 15% of the shares sold in the initial public offering could threaten to exercise its conversion
rights if such holder’s shares are not purchased by us or our management at a premium to the then-current market price or on
other undesirable terms. By limiting our shareholders’ ability to convert no more than 15% of the shares sold in the initial public
offering without our prior consent, we believe we will limit the ability of a small group of shareholders 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 shareholders’
ability to vote all of their shares (including Excess Shares) for or against our initial business combination.
Liquidation if No Business Combination
Our amended and restated memorandum and articles
of association provides that we will have until March 8, 2023 to complete an initial business combination. If we have not completed an
initial business combination by such date, 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 100% of the outstanding public shares, at a per-share price,
payable in cash, equal to the aggregate amount then on deposit in the trust account, including any interest not previously released to
us but net of taxes payable, divided by the number of then outstanding public shares, which redemption will completely extinguish public
shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable
law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders
and our board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to our obligations under Cayman
Islands law to provide for claims of creditors and the requirements of other applicable law.
Our sponsor, initial shareholders, officers and
directors have agreed that they will not propose any amendment to our amended and restated memorandum and articles of association (A) to
modify the substance or timing of our obligations with respect to conversion rights as described in this Annual Report or (B) with
respect to any other provision relating to shareholders’ rights or pre-initial business combination activity, unless we provide
our public shareholders with the opportunity to convert their public shares upon such approval at a per-share price, payable in cash,
equal to the aggregate amount then on deposit in the trust account, including interest not previously released to us but net of taxes
payable, divided by the number of then outstanding public shares. This conversion right shall apply in the event of the approval of any
such amendment, whether proposed by our sponsor, initial shareholders, executive officers, directors or any other person.
We are required to seek to have all third parties
(including any vendors or other entities we engage after the initial public offering) and any prospective target businesses enter into
agreements with us waiving any right, title, interest or claim of any kind they may have in or to any monies held in the trust account.
As a result, the claims that could be made against us will be limited, thereby lessening the likelihood that any claim would result in
any liability extending to the trust. We therefore believe that any necessary provision for creditors will be reduced and should not have
a significant impact on our ability to distribute the funds in the trust account to our public shareholders. Nevertheless, Marcum LLP,
our independent registered public accounting firm, and the underwriters of our initial public offering, will not execute agreements with
us waiving such claims to the monies held in the trust account. Furthermore, there is no guarantee that other vendors, service providers
and prospective target businesses will execute such agreements. Nor is there any guarantee that, even if they execute such agreements
with us, they will not seek recourse against the trust account. Our sponsor has agreed that it will be liable to ensure that the proceeds
in the trust account are not reduced below $10.20 per share by the claims of target businesses or claims of vendors or other entities
that are owed money by us for services rendered or contracted for or products sold to us, but we cannot assure you that it will be able
to satisfy its indemnification obligations if it is required to do so. We have not asked our sponsor to reserve for such indemnification
obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe
that our sponsor’s only assets are securities of our company. Therefore, we believe it is unlikely that our sponsor will be able
to satisfy its indemnification obligations if it is required to do so. Additionally, the agreement our sponsor entered into specifically
provides for two exceptions to the indemnity it has given: it will have no liability (1) as to any claimed amounts owed to a target
business or vendor or other entity who has executed an agreement with us waiving any right, title, interest or claim of any kind they
may have in or to any monies held in the trust account, or (2) as to any claims for indemnification by the underwriters of the initial
public offering against certain liabilities, including liabilities under the Securities Act. As a result, if we liquidate, the per-share distribution
from the trust account could be less than $10.20 due to claims or potential claims of creditors.
We anticipate notifying the trustee of the trust
account to begin liquidating such assets promptly after our 18th month and anticipate it will take no more than 10 business
days to effectuate such distribution. The holders of the founder shares and private shares have waived their rights to participate in
any liquidation distribution from the trust account with respect to such shares. There will be no distribution from the trust account
with respect to our warrants, which will expire worthless. We will pay the costs of any subsequent liquidation from our remaining assets
outside of the trust account. If such funds are insufficient, our sponsor has contractually agreed to advance us the funds necessary to
complete such liquidation (currently anticipated to be no more than approximately $15,000) and has contractually agreed not to seek repayment
for such expenses.
If we are unable to complete an initial business
combination and expend all of the net proceeds of the initial public offering, other than the proceeds deposited in the trust account,
and without taking into account interest, if any, earned on the trust account, the initial per-share redemption price would be $10.20.
Our public shareholders shall be entitled to receive
funds from the trust account only in the event of our failure to complete a business combination within the required time period, if the
shareholders seek to have us convert or purchase their respective shares upon a business combination which is actually completed by us
or upon certain amendments to our amended and restated memorandum and articles of association prior to consummating an initial business
combination. In no other circumstances shall a shareholder have any right or interest of any kind to or in the trust account.
If we are forced to file a winding-up petition
bankruptcy case or a winding-up petition or an involuntary bankruptcy case is filed against us which is not dismissed, the proceeds
held in the trust account could be subject to applicable bankruptcy or insolvency law, and may be included in our bankruptcy estate and
subject to the claims of third parties with priority over the claims of our shareholders. To the extent any bankruptcy claims deplete
the trust account, we cannot assure you we will be able to return to our public shareholders at least $10.20 per share.
If we are forced to file a winding-up petition
bankruptcy case or a winding-up petition or an involuntary bankruptcy case is filed against us which is not dismissed, any distributions
received by shareholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer”
or a “fraudulent conveyance.” As court could seek to recover all amounts received by our shareholders. Furthermore, because
we intend to distribute the proceeds held in the trust account to our public shareholders promptly after March 8, 2023, this may be viewed
or interpreted as giving preference to our public shareholders over any potential creditors with respect to access to or distributions
from our assets. Furthermore, our board may be viewed as having breached their fiduciary duties to our creditors and/or may have acted
in bad faith, and thereby exposing itself and our company to claims of punitive damages, by paying public shareholders from the trust
account prior to addressing the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons.
Amended and Restated Memorandum and Articles
of Association
Our amended and restated memorandum and articles
of association contain certain requirements and restrictions relating to the initial public offering that will apply to us until the consummation
of our initial business combination. These provisions cannot be amended without the approval of a majority of our shareholders. If we
seek to amend any provisions of our amended and restated memorandum and articles of association (A) to modify the substance or timing
of our obligations with respect to conversion rights as described in this Annual Report or (B) with respect to any other provision
relating to shareholders’ rights or pre-initial business combination activity, we will provide our public shareholders with
the opportunity to convert their public shares upon the 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 not previously released to us but net of taxes payable,
divided by the number of then outstanding public shares. This conversion right shall apply in the event of the approval of any such amendment,
whether proposed by our sponsor, initial shareholders, executive officers, directors or any other person. Our sponsor, initial shareholders,
officers and directors have agreed to waive any conversion rights with respect to any founder shares, private shares and any public shares
they may hold in connection with any vote to amend our amended and restated memorandum and articles of association. Specifically, our
amended and restated memorandum and articles of association provides, among other things, that:
| ● | we shall either (1) seek shareholder approval of our
initial business combination at a meeting called for such purpose at which shareholders may seek to convert their shares, regardless
of whether they vote for or against the proposed business combination or don’t vote at all, into their pro rata share of the aggregate
amount then on deposit in the trust account (net of taxes payable), or (2) provide our shareholders with the opportunity to sell
their shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount equal to their pro rata
share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject to the limitations described
herein; |
| ● | we will consummate our initial business combination only if
we have net tangible assets of at least $5,000,001 either immediately prior to or upon consummation of such business combination and,
if we seek shareholder approval, a majority of the outstanding ordinary shares are voted in favor of the business combination; |
| ● | if our initial business combination is not consummated by
March 8, 2023, then we will redeem all of the outstanding public shares and thereafter liquidate and dissolve our company; |
| ● | upon the consummation of the initial public offering, $176 million
shall be placed into the trust account; |
| ● | we may not consummate any other business combination, merger,
share exchange, asset acquisition, share purchase, reorganization or similar transaction prior to our initial business combination; and |
| ● | prior to our initial business combination, we may not issue
additional shares that participate in any manner in the proceeds of the trust account, or that votes as a class with the ordinary shares
sold in the initial public offering on an initial business combination. |
Corporate Information
Our executive offices are located at 300/26 Dostyk
Avenue, Almaty, Kazakhstan 050020 and our telephone number is +7 (727) 355-8021. Our corporate website address is www.oxusacquisition.com.
The information contained on, or accessible through our corporate website or any other website that we may maintain is not incorporated
by reference into this Annual Report.
We are a Cayman Islands exempted company. Exempted
companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying
with certain provisions of the Companies Act (As Revised). As an exempted company, we have applied for and received a tax exemption undertaking
from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands,
for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied
on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income,
gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares,
debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution
of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation
of us.
We are an emerging growth company as defined in
the Jumpstart Our Business Startups Act of 2012 (which we refer to herein as the JOBS Act). As such, we are eligible to 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 attestation requirements of Section 404
of the Sarbanes-Oxley Act of 2002, or 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 non-binding advisory vote on executive
compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities
less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more
volatile.
In addition, Section 107 of the JOBS Act
also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of
the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can
delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take
advantage of the benefits of this extended transition period.
We will remain an emerging growth company for
up to five years. However, if our annual gross revenue is $1.07 billion or more, if our non-convertible debt issued within a
three year period exceeds $1 billion or the market value of our ordinary shares that are held by non-affiliates exceeds $700 million
on the last day of the second fiscal quarter of any given fiscal year, we would cease to be an emerging growth company as of the following
fiscal year.
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 ordinary shares held by non-affiliates exceeds $250 million
as of the end of that year’s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed
fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the end of that year’s
second fiscal quarter.
Competition
In identifying, evaluating and selecting a target
business, we may encounter intense competition from other entities having a business objective similar to ours. Many of these entities
are well established and have extensive experience identifying and effecting business combinations directly or through affiliates. Many
of these competitors possess greater technical, human and other resources than us and our financial resources will be relatively limited
when contrasted with those of many of these competitors. While we believe there may be numerous potential target businesses that we could
acquire with the net proceeds of the initial public offering, our ability to compete in acquiring certain sizable target businesses may
be limited by our available financial resources.
The following also may not be viewed favorably
by certain target businesses:
| ● | our obligation to seek shareholder approval of a business
combination or engage in a tender offer may delay the completion of a transaction; |
| ● | our obligation to convert or repurchase Class A ordinary
shares held by our public shareholders may reduce the resources available to us for a business combination; and |
| ● | our outstanding warrants and unit purchase options, and the
potential future dilution they represent. |
Any of these factors may place us at a competitive
disadvantage in successfully negotiating a business combination. Our management believes, however, that our status as a public entity
and potential access to the United States public equity markets may give us a competitive advantage over privately held entities
having a similar business objective as ours in acquiring a target business with significant growth potential on favorable terms.
If we succeed in effecting a business combination,
there will be, in all likelihood, intense competition from competitors of the target business. We cannot assure you that, subsequent to
a business combination, we will have the resources or ability to compete effectively.
Employees
We have two executive officers. These individuals
are not obligated to devote any specific number of hours to our matters and intend to devote only as much time as they deem necessary
to our affairs. The amount of time they will devote in any time period will vary based on whether a target business has been selected
for the business combination and the stage of the business combination process the company is in. Accordingly, once a suitable target
business to acquire has been located, management may spend more time investigating such target business and negotiating and processing
the business combination (and consequently spend more time on our affairs) than had been spent prior to locating a suitable target business.
We presently expect our executive officers to devote such amount of time as they reasonably believe is necessary to our business. We do
not intend to have any full- time employees prior to the consummation of a business combination.
Periodic Reporting and Audited Financial Statements
We have registered our units, Class A ordinary
shares and warrants under the Exchange Act and have reporting obligations, including the requirement that we file annual, quarterly and
current reports with the SEC. In accordance with the requirements of the Exchange Act, our annual report will contain financial statements
audited and reported on by our independent registered public accountants.
We will provide shareholders with audited financial
statements of the prospective target business as part of any proxy solicitation materials or tender offer documents sent to shareholders
to assist them in assessing the target business. These financial statements will need to be prepared in accordance with or reconciled
to United States generally accepted accounting principles or international financial reporting standards as promulgated by the International
Accounting Standards Board. We cannot assure you that any particular target business identified by us as a potential acquisition candidate
will have the necessary financial statements. To the extent that this requirement cannot be met, we may not be able to acquire the proposed
target business.
We may be required to have our internal control
procedures audited for the fiscal year ending December 31, 2022 as required by the Sarbanes-Oxley Act. A target company may
not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of their internal controls. The development
of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary
to complete any such acquisition.
RISKS FACTORS SUMMARY
An investment in our securities involves a high
degree of risk. The occurrence of one or more of the events or circumstances described in the section entitled “Risk Factors,”
alone or in combination with other events or circumstances, may materially adversely affect our business, financial condition and operating
results. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks
include, but are not limited to, the following:
| ● | We may not be able to complete our initial business combination
before March 8, 2023, in which case we would cease all operations except for the purpose of winding up, and we would redeem our public
shares for a pro rata portion of the funds in the trust account, and we would liquidate. In such event, our warrants would expire worthless. |
| ● | Your only opportunity to affect the investment decision regarding
a potential business combination may be limited to the exercise of your right to convert your shares to cash. |
| ● | Our initial shareholders control a substantial interest in
us and thus may influence certain actions requiring a shareholder vote. |
| ● | We may not obtain a fairness opinion with respect to the target
business that we seek to acquire and therefore you may be relying solely on the judgment of our board of directors in approving a proposed
business combination. |
| ● | We may issue additional shares or debt securities to complete
a business combination, which would reduce the equity interest of our shareholders and likely cause a change in control of our ownership. |
| ● | We may be unable to obtain additional financing, if required,
to complete a business combination or to fund the operations and growth of the target business. |
| ● | Resources could be wasted in researching acquisitions that
are not consummated, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. |
| ● | 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 recent coronavirus (COVID-19)
pandemic and other events, and the status of debt and equity markets. |
| ● | 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. |
| ● | If we consummate a business combination with a target company
with assets located in the CIS or other country in South and South-East Asia and MENA regions, our results of
operations and prospects could be subject to the economic, political, and legal policies, developments, and conditions in the country
in which we operate. Further, the laws applicable to such company will likely govern all of our material agreements and we may not be
able to enforce our legal rights. |
| ● | There may be tax consequences to our business combination
that may adversely affect us. |
| ● | Our officers and directors presently have 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. |
| ● | Our officers and directors may have interests in a potential
business combination that are different than yours, which may create conflicts of interest. |
| ● | 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 may amend the terms of the warrants in a manner that may
be adverse to holders of public warrants with the approval by a majority of the then outstanding public warrants. |
| ● | We may redeem your unexpired warrants prior to their exercise
at a time that is disadvantageous to you, thereby making your warrants worthless. |
| ● | If third parties bring claims against us, and if our directors
decide not to enforce the indemnification obligations of our sponsor, or if our sponsor does not have the funds to indemnify us, the
proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than
$10.20 per share. |
| ● | Provisions in our amended and restated memorandum and articles
of association may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for our ordinary
shares and could entrench management. |
| ● | Our shareholders may be held liable for claims by third parties
against us to the extent of distributions received by them upon redemption of their shares. |
| ● | We may not hold an annual meeting of shareholders until after
the consummation of our initial business combination. |
| ● | We are a newly formed company with no operating history, and,
accordingly, you have no basis on which to evaluate our ability to achieve our business objective. |
| ● | 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. |
| ● | We are an emerging growth company and 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, this could make our securities less attractive to investors and may make it more difficult to compare our performance
with other public companies. |
| ● | Cyber incidents or attacks directed at us could result in
information theft, data corruption, operational disruption and/or financial loss. |
ITEM 1A. RISK FACTORS
This Annual Report contains forward-looking
information based on our current expectations. You should carefully consider the risks and uncertainties described below together with
all of the other information contained in this Annual Report, including our financial statements and the related notes appearing at the
end of this Annual Report, before deciding whether to invest in our units. 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 Associated with Our Business
We are a newly formed company with no operating
history and, accordingly, you will not have any basis on which to evaluate our ability to achieve our business objective.
We are a newly formed company with no operating
results to date. Since we do not have an operating history, you will have no basis upon which to evaluate our ability to achieve our business
objective, which is to acquire an operating business. We have not conducted any substantive discussions and we have no plans, arrangements
or understandings with any prospective acquisition candidates. We will not generate any revenues until, at the earliest, after the consummation
of a business combination.
If we are unable to consummate a business
combination, our public shareholders may be forced to wait until after March 8, 2023 before receiving distributions from the trust account.
We have until March 8, 2023 to complete a business
combination. We have no obligation to return funds to investors prior to such date unless we consummate a business combination prior thereto
and only then in cases where investors have sought to convert or sell their shares to us. Only after the expiration of this full time
period will public security holders be entitled to distributions from the trust account if we are unable to complete a business combination.
Accordingly, investors’ funds may be unavailable to them until after such date and to liquidate your investment, public security
holders may be forced to sell their public shares or warrants, potentially at a loss.
Our public shareholders may not be afforded
an opportunity to vote on our proposed business combination.
We will either (1) seek shareholder approval
of our initial business combination at a meeting called for such purpose at which public shareholders may seek to convert their shares,
regardless of whether they vote for or against the proposed business combination or don’t vote at all, into their pro rata share
of the aggregate amount then on deposit in the trust account (net of taxes payable), or (2) provide our public shareholders with
the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount
equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject
to the limitations described elsewhere in this Annual Report. Accordingly, it is possible that we will consummate our initial business
combination even if holders of a majority of our public shares do not approve of the business combination we consummate. The decision
as to whether we will seek shareholder approval of a proposed business combination or will allow shareholders 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 shareholder approval. For instance, Nasdaq rules
currently allow us to engage in a tender offer in lieu of a shareholder meeting but would still require us to obtain shareholder approval
if we were seeking to issue more than 20% of our outstanding shares to a target business as consideration in any business combination.
Therefore, if we were structuring a business combination that required us to issue more than 20% of our outstanding shares, we would seek
shareholder approval of such business combination instead of conducting a tender offer.
You will not be entitled to protections
normally afforded to investors of blank check companies.
Since the net proceeds of the initial public offering
are intended to be used to complete a business combination with a target business that has not been identified, we may be deemed to be
a “blank check” company under the United States securities laws. However, since we have net tangible assets in excess
of $5,000,000, we are exempt from rules promulgated by the SEC to protect investors of blank check companies such as Rule 419. Accordingly,
investors will not be afforded the benefits or protections of those rules which would, for example, completely restrict the transferability
of our securities and restrict the use of interest earned on the funds held in the trust account. Because we are not subject to Rule 419,
our units will be immediately tradable and we will be entitled to withdraw amounts from the funds held in the trust account prior to the
completion of a business combination.
If we determine to change our acquisition
criteria or guidelines, many of the disclosures contained in this Annual Report would not be applicable and you would be investing in
our company without any basis on which to evaluate the potential target business we may acquire.
We could seek to deviate from the acquisition
criteria or guidelines disclosed in this Annual Report although we have no current intention to do so. Accordingly, investors may be making
an investment in our company without any basis on which to evaluate the potential target business we may acquire. Regardless of whether
or not we deviate from the acquisition criteria or guidelines in connection with any proposed business combination, investors will always
be given the opportunity to convert their shares or sell them to us in a tender offer in connection with any proposed business combination
as described in this Annual Report.
We may issue additional Class A ordinary
shares or preferred shares or debt securities to complete our initial business combination or under an employee incentive plan after completion
of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the Class B ordinary 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 amended and restated memorandum and articles of association. Any such issuances would dilute the interest of our shareholders
and likely present other risks.
Our amended and restated memorandum and articles
of association authorizes the issuance of up to 500,000,000 Class A ordinary shares, par value $0.0001 per share, 50,000,000 Class B
ordinary shares, par value $0.0001 per share, and 5,000,000 preferred shares, par value $0.0001 per share. As of December 31, 2021, there
are 482,450,000 and 45,687,500 authorized but unissued Class A ordinary shares and Class B ordinary shares, respectively, available
for issuance, which amount takes into account the Class A ordinary shares reserved for issuance upon exercise of outstanding warrants
but not the Class A ordinary shares issuable upon conversion of Class B ordinary shares. As of December 31, 2021, there are
no preferred shares issued and outstanding. Class B ordinary shares are convertible into Class A ordinary shares initially at
a one-for-one ratio but subject to adjustment as set forth herein, including in certain circumstances in which we issue Class A
ordinary shares or equity-linked securities related to our initial business combination. Class B ordinary shares are also convertible
at the option of the holder at any time.
We may issue a substantial number of additional
Class A ordinary shares or preferred shares to complete our initial business combination or under an employee incentive plan after
completion of our initial business combination (although our amended and restated memorandum and articles of association provides that
we may not issue securities that can vote with ordinary shareholders on matters related to our pre-initial business combination activity).
We may also issue Class A ordinary shares to redeem the warrants or upon conversion of the Class B ordinary 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 amended and restated memorandum and articles of association. However, our amended and restated memorandum and articles of association
provides, among other things, that prior to or in connection with 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 on any initial business combination.
These provisions of our amended and restated memorandum and articles of association, like all provisions of our amended and restated memorandum
and articles of association, may be amended with the approval of our shareholders. However, our sponsor, initial shareholders, officers
and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated
memorandum and articles of association (A) to modify the substance or timing of our obligations with respect to conversion rights
as described in this Annual Report or (B) with respect to any other provision relating to shareholders’ rights or pre-initial business
combination activity, unless we provide our public shareholders with the opportunity to convert their public shares 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 (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.
The issuance of additional Class A ordinary
shares or preferred shares:
| ● | may significantly dilute the equity interest of investors
in the initial public offering; |
| ● | may subordinate the rights of holders of ordinary shares
if preferred shares are issued with rights senior to those afforded our ordinary shares; |
| ● | could cause a change of control if a substantial number of
our ordinary shares are 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 ordinary shares and/or warrants. |
Similarly, if we issue debt securities, it
could result in:
| ● | default and foreclosure on our assets if our operating revenues
after a 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 security is payable on demand; and |
| ● | our inability to obtain necessary additional financing if
the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding. |
If we incur indebtedness, our lenders will not
have a claim on the cash in the trust account and such indebtedness will not decrease the per-share conversion amount in the trust
account.
If the net proceeds of the initial public
offering not being held in trust are insufficient to allow us to operate until March 8, 2023, we may be unable to complete a business
combination.
Of the net proceeds of the initial public offering,
only approximately $1,750,000 will be available to us initially outside the trust account to fund our working capital requirements. We
believe that, upon closing of the initial public offering, such funds will be sufficient to allow us to operate until March 8, 2023; however,
we cannot assure you that our estimate is accurate. Accordingly, if we use all of the funds held outside of the trust account, we may
not have sufficient funds available with which to structure, negotiate or close an initial business combination. In such event, we would
need to borrow funds from our sponsor, initial shareholders, officers or directors or their affiliates to operate or may be forced to
liquidate. Our sponsor, initial shareholders, officers, directors and their affiliates may, but are not obligated to, loan us on a non-interest bearing
basis funds, from time to time or at any time, in whatever amount that they deem reasonable in their sole discretion for our working capital
needs. Each loan would be evidenced by a promissory note. The notes would either be paid upon consummation of our initial business combination,
without interest, or, at holder’s discretion, up to $1,500,000 of the notes may be converted into warrants at a price of $1.00 per
warrant.
If third parties bring claims against us,
the proceeds held in trust could be reduced and the per-share redemption price received by shareholders may be less than $10.20.
Our placing of funds in trust may not protect
those funds from third party claims against us. Although we will seek to have all vendors and service providers we engage and prospective
target businesses we negotiate with 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 shareholders, they may not execute such agreements. Furthermore, even if such
entities execute such agreements with us, they may seek recourse against the trust account. A court may not uphold the validity of such
agreements. Accordingly, the proceeds held in trust could be subject to claims which could take priority over those of our public shareholders.
If we are unable to complete a business combination and distribute the proceeds held in trust to our public shareholders, our sponsor
has agreed (subject to certain exceptions described elsewhere in this Annual Report) that it will be liable to ensure that the proceeds
in the trust account are not reduced below $10.20 per share by the claims of target businesses or claims of vendors or other entities
that are owed money by us for services rendered or contracted for or products sold to us. However, we have not asked our sponsor to reserve
for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity
obligations and believe that our sponsor’s only assets are securities of our company. Therefore, we believe it is unlikely that
our sponsor will be able to satisfy its indemnification obligations if it is required to do so. As a result, the per-share distribution
from the trust account may be less than $10.20, plus interest, due to such claims.
Additionally, if we are forced to file a bankruptcy
case or an involuntary bankruptcy case is filed against us which 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 shareholders. To the extent any bankruptcy claims deplete the trust account, we may not be able to return to our public
shareholders at least $10.20.
Our shareholders may be held liable for
claims by third parties against us to the extent of distributions received by them.
Our amended and restated memorandum and articles
of association provides that we will continue in existence only until March 8, 2023. If we have not completed a business combination by
such date, 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 100% of the outstanding public shares, at a per-share price, payable in cash,
equal to the aggregate amount then on deposit in the trust account, including any interest not previously released to us but net of taxes
payable, divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders’
rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors,
dissolve and liquidate, subject (in the case of (ii) and (iii) above) to our obligations under Cayman Islands law to provide
for claims of creditors and the requirements of other applicable law. We cannot assure you that we will properly assess all claims that
may be potentially brought against us. As such, our shareholders could potentially be liable for any claims to the extent of distributions
received by them (but no more) and any liability of our shareholders may extend well beyond the third anniversary of the date of distribution.
Accordingly, we cannot assure you that third parties will not seek to recover from our shareholders amounts owed to them by us.
If we are forced to file a bankruptcy case or
an involuntary bankruptcy case is filed against us which is not dismissed, any distributions received by shareholders 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 all amounts received by our shareholders. Furthermore, because we intend to distribute
the proceeds held in the trust account to our public shareholders promptly after expiration of the time we have to complete an initial
business combination, this may be viewed or interpreted as giving preference to our public shareholders over any potential creditors with
respect to access to or distributions from our assets. Furthermore, our board may be viewed as having breached their fiduciary duties
to our creditors and/or may have acted in bad faith, and thereby exposing itself and our company to claims of punitive damages, by paying
public shareholders from the trust account prior to addressing the claims of creditors. We cannot assure you that claims will not be brought
against us for these reasons.
The securities in which we invest the funds
held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the
per-share redemption amount received by public shareholders may be less than $10.20 per share.
The proceeds held in the trust account will be
invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain
conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations.
While short-term U.S. government 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 that we are unable to complete our initial business combination or make certain amendments to our amended and restated memorandum
and articles of association, our public shareholders are entitled to receive their pro-rata share of the proceeds held in the trust
account, plus any interest income, net of taxes payable. Negative interest rates could reduce the value of the assets held in trust such
that the per-share redemption amount received by public shareholders may be less than $10.20 per share.
Our directors may decide not to enforce
our sponsor’s indemnification obligations, resulting in a reduction in the amount of funds in the trust account available for distribution
to our public shareholders.
In the event that the proceeds in the trust account
are reduced below $10.20 per public share and our sponsor 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 our sponsor
to enforce such indemnification obligations. It is possible that our independent directors in exercising their business judgment 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 shareholders may be reduced below $10.20 per share.
If we do not maintain a current and effective
prospectus relating to the Class A ordinary shares issuable upon exercise of the warrants, holders will only be able to exercise
such warrants on a “cashless basis.”
If we do not maintain a current and effective
prospectus relating to the Class A ordinary shares issuable upon exercise of the warrants at the time that holders wish to exercise
such warrants, they will only be able to exercise them on a “cashless basis” provided that an exemption from registration
is available. As a result, the number of Class A ordinary shares that holders will receive upon exercise of the warrants will be
fewer than it would have been had such holder exercised his warrant for cash. Further, if an exemption from registration is not available,
holders would not be able to exercise on a cashless basis and would only be able to exercise their warrants for cash if a current and
effective prospectus relating to the Class A ordinary shares issuable upon exercise of the warrants is available. Under the terms
of the warrant agreement, we have agreed to use our best efforts to meet these conditions and to file and maintain a current and effective
prospectus relating to the Class A ordinary shares issuable upon exercise of the warrants until the expiration of the warrants. However,
we cannot assure you that we will be able to do so. If we are unable to do so, the potential “upside” of the holder’s
investment in our company may be reduced or the warrants may expire worthless.
An investor will only be able to exercise
a warrant if the issuance of Class A ordinary shares upon such exercise has been registered or qualified or is deemed exempt under
the securities laws of the state of residence of the holder of the warrants.
No warrants will be exercisable and we will not
be obligated to issue Class A ordinary shares unless the Class A ordinary shares issuable upon such exercise has been registered
or qualified or deemed to be exempt under the securities laws of the state of residence of the holder of the warrants. If the Class A
ordinary shares issuable upon exercise of the warrants are not qualified or exempt from qualification in the jurisdictions in which the
holders of the warrants reside, the warrants may be deprived of any value, the market for the warrants may be limited and they may expire
worthless if they cannot be sold.
We may amend the terms of the warrants in
a manner that may be adverse to holders 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 our Class A
ordinary shares purchasable upon exercise of a warrant could be decreased, all without your approval.
Our warrants are 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 (i) to cure any ambiguity or correct any mistake,
including to conform the provisions of the warrant agreement to the description of the terms of the warrants and the warrant agreement
set forth in the prospectus for our initial public offering, or to cure, correct or supplement any defective provision, or (ii) to
add or change any other provisions with respect to matters or questions arising under the warrant agreement as the parties to the warrant
agreement may deem necessary or desirable and that the parties deem to not adversely affect the interests of the registered holders of
the warrants. The warrant agreement requires the approval by the holders of at least 50% of the then outstanding public warrants in order
to make any change that adversely affects the interests of the registered holders. 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 shares, shorten the exercise period or decrease the number of our Class A ordinary shares purchasable upon exercise
of a warrant.
Our warrant agreement designates 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 consummate an initial business combination.
If:
| ● | we issue additional Class A ordinary shares 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 share of Class A ordinary shares, |
| ● | 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 consummation of our initial business combination (net of redemptions), and |
| ● | the Market Value is below $9.20 per share, |
then the exercise price of the warrants will be
adjusted (to the nearest cent) to be equal to 115% of the greater of (i) the Market Value or (ii) the Newly Issued Price, and
the $18.00 per share redemption trigger price of the warrants will be adjusted (to the nearest cent) to be equal to 180% of the greater
of (i) the Market Value or (ii) the Newly Issued Price. This may make it more difficult for us to consummate an initial business
combination with a target business.
Since we have not yet selected a particular
industry or target business with which to complete a business combination, we are unable to currently ascertain the merits or risks of
the industry or business in which we may ultimately operate.
We may pursue an acquisition opportunity in any
business industry or sector we choose. Accordingly, there is no current basis for you to evaluate the possible merits or risks of the
particular industry in which we may ultimately operate or the target business which we may ultimately acquire. To the extent we complete
a business combination with a financially unstable company or an entity in its development stage, we may be affected by numerous risks
inherent in the business operations of those entities. If we complete a business combination with an entity in an industry characterized
by a high level of risk, we may be affected by the currently unascertainable risks of that industry. Although our management will endeavor
to evaluate the risks inherent in a particular industry or target business, we cannot assure you that we will properly 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 initial public offering than a direct investment, if an opportunity were available, in a target business.
Our ability to successfully effect a business
combination and to be successful thereafter will be totally dependent upon the efforts of our key personnel, some of whom may join us
following a business combination. While we intend to closely scrutinize any individuals we engage after a business combination, we cannot
assure you that our assessment of these individuals will prove to be correct.
Our ability to successfully effect a business
combination is dependent upon the efforts of our key personnel. We believe that our success depends on the continued service of our key
personnel, at least until we have consummated our initial business combination. We cannot assure you that any of our key personnel will
remain with us for the immediate or foreseeable future. In addition, none of our officers is required to commit any specified amount of
time to our affairs and, accordingly, our officers will have conflicts of interest in allocating management time among various business
activities, including identifying potential business combinations and monitoring the related due diligence. We do not have employment
agreements with, or key-man insurance on the life of, any of our officers. The unexpected loss of the services of our key personnel
could have a detrimental effect on us.
The role of our key personnel after a business
combination, however, cannot presently be ascertained. Although some of our key personnel serve in senior management or advisory positions
following a business combination, it is likely that most, if not all, of the management of the target business will remain in place. While
we intend to closely scrutinize any individuals we engage after a 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 public company which could
cause us to have to expend time and resources helping them become familiar with such requirements. This could be expensive and time-consuming and
could lead to various regulatory issues which may adversely affect our operations.
Our officers and directors may not have
significant experience or knowledge regarding the jurisdiction or industry of the target business we may seek to acquire.
We may consummate a business combination with
a target business in any geographic location or industry we choose. We cannot assure you that our officers or directors will have enough
experience or have sufficient knowledge relating to the jurisdiction of the target or its industry to make an informed decision regarding
a business combination.
Our key personnel may negotiate employment
or consulting agreements with a target business in connection with a particular business combination. These agreements may provide for
them to receive compensation following a 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 will be able to remain with
the company after the consummation of a business combination only if they are able to negotiate employment or consulting agreements or
other appropriate arrangements 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 the company after the consummation of the business combination. The personal and financial
interests of such individuals may influence their motivation in identifying and selecting a target business.
Our 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 could have a negative impact on our ability to consummate a business combination.
Our officers and directors will not commit their
full time to our affairs. We presently expect each of our officers and directors to devote such amount of time as they reasonably believe
is necessary to our business. We do not intend to have any full-time employees prior to the consummation of our initial business
combination. The foregoing could have a negative impact on our ability to consummate our initial business combination.
Our officers and directors may have a conflict
of interest in determining whether a particular target business is appropriate for a business combination.
Our initial shareholders waived their right to
convert founder shares or any other shares purchased in the initial public offering or thereafter, or to receive distributions from the
trust account with respect to its founder shares upon our liquidation if we are unable to consummate a business combination. Accordingly,
the shares acquired prior to the initial public offering, as well as the private warrants and any warrants purchased by our officers or
directors in the aftermarket, will be worthless if we do not consummate a business combination. 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 and in determining whether the terms, conditions and timing of a particular business combination are appropriate and in our
shareholders’ best interest.
Our officers and directors or their affiliates
have pre-existing fiduciary and contractual obligations and may in the future become affiliated with other entities engaged in business
activities similar to those intended to be conducted by us. Accordingly, they may have conflicts of interest in determining to which entity
a particular business opportunity should be presented.
Our officers and directors or their affiliates
have pre-existing fiduciary and contractual obligations to other companies. Accordingly, they may participate in transactions and
have obligations that may be in conflict or competition with our consummation of our initial business combination. As a result, a potential
target business may be presented by our management team to another entity prior to its presentation to us and we may not be afforded the
opportunity to engage in a transaction with such target business. Additionally, our officers and directors may in the future become affiliated
with entities that are engaged in a similar business, including another blank check company that may have acquisition objectives that
are similar to ours. 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 other entities
prior to its presentation to us, subject to our officers’ and directors’ fiduciary duties under Cayman Islands law.
EarlyBirdCapital and Sova Capital may have
a conflict of interest in rendering services to us in connection with our initial business combination.
We have engaged EarlyBirdCapital and Sova Capital
to assist us in connection with our initial business combination. We will pay EarlyBirdCapital and Sova Capital a cash fee for such services
in an aggregate amount equal to up to 3.0% of the total gross proceeds raised in the offering only if we consummate our initial business
combination. This financial interest may result in EarlyBirdCapital and Sova Capital having a conflict of interest when providing the
services to us in connection with an initial business combination.
Nasdaq may delist our securities from quotation
on its exchange which could limit investors’ ability to make transactions in our securities and subject us to additional trading
restrictions.
Our securities have been listed on Nasdaq, a national
securities exchange, upon consummation of the initial public offering. Although, after giving effect to the initial public offering, we
expect to meet on a pro forma basis Nasdaq’s minimum initial listing standards, which generally only require that we meet certain
requirements relating to shareholders’ equity, market capitalization, aggregate market value of publicly held shares and distribution
requirements, we cannot assure you that our securities will be, or will continue to be, listed on Nasdaq in the future or prior to an
initial business combination. Additionally, in connection with our initial business combination, it is likely that Nasdaq will require
us to file a new initial listing application and meet its initial listing requirements as opposed to its more lenient continued listing
requirements. We cannot assure you that we will be able to meet those initial listing requirements at that time. Nasdaq will also have
discretionary authority to not approve our listing if it determines that the listing of the company to be acquired is against public policy
at that time.
If Nasdaq delists our securities from trading
on its exchange, or we are not listed in connection with our initial business combination, we could face significant material adverse
consequences, including:
| ● | a limited availability of market quotations for our securities; |
| ● | reduced liquidity with respect to our securities; |
| ● | a determination that our Class A ordinary shares are
“penny stock” which will require brokers trading in our Class A ordinary shares to adhere to more stringent rules, possibly
resulting in a reduced level of trading activity in the secondary trading market for our Class A ordinary shares; |
| ● | a limited amount of news and analyst coverage for our company;
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 ordinary shares and warrants
will be listed on Nasdaq, our units, Class A ordinary shares and warrants will be covered securities. 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, 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 be covered securities and we would be subject to regulation in each state in which we offer our securities.
If we seek shareholder approval of our initial
business combination and we do not conduct conversions pursuant to the tender offer rules, and if you or a “group” of shareholders
are deemed to hold in excess of 15% of our Class A ordinary shares, you will lose the ability to redeem all such shares in excess
of 15% of our Class A ordinary shares.
If we seek shareholder approval of our initial
business combination and we do not conduct conversions in connection with our initial business combination pursuant to the tender offer
rules, our amended and restated memorandum and articles of association provides that a public shareholder, together with any affiliate
of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under
Section 13 of the Exchange Act), will be restricted from seeking conversion rights with respect to more than an aggregate of 15%
of the shares sold in the initial public offering without our prior consent, which we refer to as the “Excess Shares.” However,
we would not be restricting our shareholders’ ability to vote all of their shares (including Excess Shares) for or against our initial
business combination. Your inability to convert 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 conversion distributions with respect to the Excess Shares if we complete our initial business combination.
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.
We are an emerging growth company within
the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to emerging growth
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 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 shareholder approval of any golden parachute payments not previously approved. As a result,
our shareholders 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 aggregate worldwide market value of our
Class A ordinary shares 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.
We may only be able to complete one business
combination with the proceeds of the initial public offering, which will cause us to be solely dependent on a single business which may
have a limited number of products or services.
It is likely we will consummate a business combination
with a single target business, although we have the ability to simultaneously acquire several target businesses. By consummating a 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,
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 developments, any or all of which may have a substantial adverse impact upon the particular
industry in which we may operate subsequent to a business combination.
Alternatively, if we determine to simultaneously
acquire several businesses and such businesses 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 the 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.
The ability of our shareholders to exercise
their conversion rights or sell their shares to us in a tender offer may not allow us to effectuate the most desirable business combination
or optimize our capital structure.
If our business combination requires us to use
substantially all of our cash to pay the purchase price, because we will not know how many shareholders may exercise conversion rights
or seek to sell their shares to us in a tender offer, we may either need to reserve part of the trust account for possible payment upon
such conversion, or we may need to arrange third party financing to help fund our business combination. In the event that the acquisition
involves the issuance of our share as consideration, we may be required to issue a higher percentage of our share to make up for a shortfall
in funds. Raising additional funds to cover any shortfall may involve dilutive equity financing or incurring indebtedness at higher than
desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provision of the Class B ordinary
shares results in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the Class B ordinary
shares at the time of our business combination. This may limit our ability to effectuate the most attractive business combination available
to us.
In connection with any vote to approve a
business combination, we will offer each public shareholder the option to vote in favor of a proposed business combination and still seek
conversion of his, her or its shares.
In connection with any vote to approve a business
combination, we will offer each public shareholder (but not our sponsor, initial shareholders, representatives, officers or directors)
the right to have his, her or its Class A ordinary shares converted to cash (subject to the limitations described elsewhere in this
Annual Report) regardless of whether such shareholder votes for or against such proposed business combination or does not vote at all.
The ability to seek conversion while voting in favor of our proposed business combination may make it more likely that we will consummate
a business combination.
In connection with any shareholder meeting
called to approve a proposed initial business combination, we may require shareholders who wish to convert their shares in connection
with a proposed business combination to comply with specific requirements for conversion that may make it more difficult for them to exercise
their conversion rights prior to the deadline for exercising their rights.
In connection with any shareholder meeting called
to approve a proposed initial business combination, each public shareholder will have the right, regardless of whether he is voting for
or against such proposed business combination or does not vote at all, to demand that we convert his shares into a pro rata share of the
trust account as of two business days prior to the consummation of the initial business combination. We may require public shareholders
who wish to convert their shares in connection with a proposed business combination to either (i) tender their certificates to our
transfer agent or (ii) deliver their shares to the transfer agent electronically using the Depository Trust Company’s DWAC
(Deposit/Withdrawal At Custodian) System, at the holders’ option, in each case prior to a date set forth in the tender offer documents
or proxy materials sent in connection with the proposal to approve the business combination. In order to obtain a physical share certificate,
a shareholder’s broker and/or clearing broker, DTC and our transfer agent will need to act to facilitate this request. It is our
understanding that shareholders should generally allot at least two weeks to obtain physical certificates from the transfer agent. However,
because we do not have any control over this process or over the brokers or DTC, it may take significantly longer than two weeks to obtain
a physical share certificate. While we have been advised that it takes a short time to deliver shares through the DWAC System, we cannot
assure you of this fact. Accordingly, if it takes longer than we anticipate for shareholders to deliver their shares, shareholders who
wish to convert may be unable to meet the deadline for exercising their conversion rights and thus may be unable to convert their shares.
If, in connection with any shareholder meeting
called to approve a proposed business combination, we require public shareholders who wish to convert their shares to comply with specific
requirements for conversion, such converting shareholders may be unable to sell their securities when they wish to in the event that the
proposed business combination is not approved.
If we require public shareholders who wish to
convert their shares to comply with specific requirements for conversion and such proposed business combination is not consummated, we
will promptly return such certificates to the tendering public shareholders. Accordingly, investors who attempted to convert their shares
in such a circumstance will be unable to sell their securities after the failed acquisition until we have returned their securities to
them. The market price for our Class A ordinary shares may decline during this time and you may not be able to sell your securities
when you wish to, even while other shareholders that did not seek conversion may be able to sell their securities.
Because of our structure, other companies
may have a competitive advantage and we may not be able to consummate an attractive business combination.
We expect to encounter intense competition from
entities other than blank check companies having a business objective similar to ours, including venture capital funds, leveraged buyout
funds and operating businesses competing for acquisitions. Many of these entities are well established and have extensive experience in
identifying and effecting business combinations directly or through affiliates. Many of these competitors possess greater technical, human
and other resources than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors.
While we believe that there are numerous potential target businesses that we could acquire with the net proceeds of the initial public
offering, our ability to compete in acquiring certain sizable target businesses 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,
seeking shareholder approval or engaging in a tender offer in connection with any proposed business combination may delay the consummation
of such a transaction. Additionally, our outstanding warrants, and the future dilution they potentially represent, may not be viewed favorably
by certain target businesses. Any of the foregoing may place us at a competitive disadvantage in successfully negotiating a business combination.
We may be unable to obtain additional financing,
if required, to complete a business combination or to fund the operations and growth of the target business, which could compel us to
restructure or abandon a particular business combination.
Although we believe that the net proceeds of the
initial public offering, together with interest earned on the funds held in the trust account available to us, will be sufficient to allow
us to consummate a business combination, because we have not yet identified any prospective target business, we cannot ascertain the capital
requirements for any particular transaction. If the net proceeds of the initial public offering prove to be insufficient, either because
of the size of the business combination, the depletion of the available net proceeds in search of a target business, or the obligation
to convert into cash a significant number of shares from dissenting shareholders, we will be required to seek additional financing. Such
financing may not be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed
to consummate a particular business combination, we would be compelled to either restructure the transaction or abandon that particular
business combination and seek an alternative target business candidate. In addition, if we consummate a business combination, we may require
additional 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 sponsor, officers, directors or shareholders
is required to provide any financing to us in connection with or after a business combination.
Our initial shareholders control a substantial
interest in us and thus may influence certain actions requiring a shareholder vote.
Our initial shareholders own approximately 20%
of our issued and outstanding shares of ordinary shares (without taking into account underwriter founder shares and assuming our initial
shareholders do not purchase any units in the initial public offering). None of our sponsor, officers, directors, initial shareholders
or their affiliates has indicated any intention to purchase units in the initial public offering or any units or ordinary shares from
persons in the open market or in private transactions. However, our sponsor, officers, directors, initial shareholders or their affiliates
could determine in the future to make such purchases in the open market or in private transactions, to the extent permitted by law, in
order to influence the vote or magnitude of the number of shareholders seeking to tender their shares to us. In connection with any vote
for a proposed business combination, our initial shareholders, including our sponsor, as well as all of our officers and directors, have
agreed to vote the ordinary shares owned by them immediately before the initial public offering as well as any Class A ordinary shares
acquired in the initial public offering or in the aftermarket in favor of such proposed business combination.
Our board of directors is and will be divided
into three classes, each of which will generally serve for a term of three years with only one class of directors being elected in each
year. It is unlikely that there will be an annual meeting of shareholders to elect new directors prior to the consummation of a business
combination, in which case all of the current directors will continue in office until at least the consummation of the business combination.
Accordingly, you may not be able to exercise your voting rights under corporate law up to until March 8, 2023. 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 sponsor, because of their ownership position, will have considerable influence regarding the outcome. Accordingly, our initial
shareholders will continue to exert control at least until the consummation of a business combination.
Our initial shareholders paid an aggregate
of $25,000 for the founder shares, or approximately $0.006 per founder share. As a result of this low initial price, our initial shareholders
stand to make a substantial profit even if an initial business combination subsequently declines in value or is unprofitable for our public
shareholders.
As a result of the low acquisition cost of our
founder shares, our initial shareholders could make a substantial profit even if we select and consummate an initial business combination
with an acquisition target that subsequently declines in value or is unprofitable for our public shareholders. Thus, our sponsor, directors
and officers may have more of an economic incentive for us to enter into an initial business combination with a riskier, weaker-performing or
financially unstable business, or an entity lacking an established record of revenues or earnings, than would be the case if our initial
shareholders had paid the full offering price for their founder shares.
Our outstanding warrants may have an adverse
effect on the market price of our Class A ordinary shares and make it more difficult to effect a business combination.
We have issued warrants to purchase 17,250,000
Class A ordinary shares and private warrants to purchase 9,300,000 Class A ordinary shares, $11.50 per share. We may also issue
other warrants to our sponsor, initial shareholders, officers, directors or their affiliates in payment of working capital loans made
to us as described in this Annual Report. To the extent we issue Class A ordinary shares to effect a business combination, the potential
for the issuance of a substantial number of additional shares upon exercise of these warrants could make us a less attractive acquisition
vehicle in the eyes of a target business. Such securities, when exercised, will increase the number of issued and outstanding ordinary
shares and reduce the value of the shares issued to complete the business combination. Accordingly, our warrants may make it more difficult
to effectuate a business combination or increase the cost of acquiring the target business. Additionally, the sale, or even the possibility
of sale, of the shares underlying the warrants could have an adverse effect on the market price for our securities or on our ability to
obtain future financing. If and to the extent these warrants are exercised, you may experience dilution to your holdings.
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 outstanding warrants
at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the last reported
sales price of the Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for share splits, share dividends, reorganizations
and recapitalizations) for any 20 trading days within a 30 trading-day period commencing at any time after the warrants become exercisable
and ending on the third business day prior to proper notice of such redemption provided that on the date we give notice of redemption
and during the entire period thereafter until the time we redeem the warrants, we have an effective registration statement under the Securities
Act covering the Class A ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available.
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. Redemption of the outstanding warrants could force you (i) to
exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell
your warrants at the then-current market price when you might otherwise wish to hold your warrants or (iii) to accept the nominal
redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market
value of your warrants.
Our management’s ability to require
holders of our warrants to exercise such warrants on a cashless basis will cause holders to receive fewer Class A ordinary shares
upon their exercise of the warrants than they would have received had they been able to exercise their warrants for cash.
If we call our public warrants for redemption
after the redemption criteria described elsewhere in this Annual Report have been satisfied, our management will have the option to require
any holder that wishes to exercise his warrant (including any private warrants) to do so on a “cashless basis.” If our management
chooses to require holders to exercise their warrants on a cashless basis, the number of Class A ordinary shares received by a holder
upon exercise will be fewer than it would have been had such holder exercised his warrant for cash. This will have the effect of reducing
the potential “upside” of the holder’s investment in our company.
If our security holders exercise their registration
rights, it may have an adverse effect on the market price of our Class A ordinary shares and the existence of these rights may make
it more difficult to effect a business combination.
The holders of the majority of the founder shares
are entitled to make a demand that we register the resale of the founder shares at any time commencing three months prior to the date
on which the founder shares may be released from escrow. Additionally, the holders of the private warrants and any warrants our sponsor,
initial shareholders, officers, directors, or their affiliates may be issued in payment of working capital loans made to us, are entitled
to demand that we register the resale of the private warrants and any other warrants we issue to them (and the underlying securities)
commencing at any time after we consummate an initial business combination. The presence of these additional securities trading in the
public market may have an adverse effect on the market price of our securities. In addition, the existence of these rights may make it
more difficult to effectuate a business combination or increase the cost of acquiring the target business, as the shareholders of the
target business may be discouraged from entering into a business combination with us or will request a higher price for their securities
because of the potential effect the exercise of such rights may have on the trading market for our Class A ordinary shares.
If we are deemed to be an investment company,
we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for
us to complete a business combination.
A company that, among other things, is or holds
itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting, owning, trading or
holding certain types of securities would be deemed an investment company under the Investment Company Act, as amended, or the Investment
Company Act. Since we will invest the proceeds held in the trust account, it is possible that we could be deemed an investment company.
Notwithstanding the foregoing, we do not believe that our anticipated principal activities will subject us to the Investment Company Act.
To this end, the proceeds held in trust may be invested by the trustee only 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. By restricting the investment of the proceeds to these instruments, we intend to meet the requirements
for the exemption provided in Rule 3a-1 promulgated under the Investment Company Act.
If we are nevertheless deemed to be an investment
company under the Investment Company Act, we may be subject to certain restrictions that may make it more difficult for us to complete
a business combination, including:
| ● | restrictions on the nature of our investments; and |
| ● | restrictions on the issuance of securities. |
In addition, we may have imposed upon us certain
burdensome requirements, including:
| ● | registration as an investment company; |
| ● | adoption of a specific form of corporate structure; and |
| ● | reporting, record keeping, voting, proxy, compliance policies
and procedures and disclosure requirements and other rules and regulations. |
Compliance with these additional regulatory burdens
would require additional expense for which we have not allotted.
If we do not conduct an adequate due diligence
investigation of a target business, we may be required to subsequently 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 our share price,
which could cause you to lose some or all of your investment.
We must conduct a due diligence investigation
of the target businesses we intend to acquire. Intensive due diligence is time consuming and expensive due to the operations, accounting,
finance and legal professionals who must be involved in the due diligence process. Even if we conduct extensive due diligence on a target
business, this diligence may not reveal all material issues that may affect a particular target business, and factors outside the control
of the target business and outside of our control may later arise. If our diligence fails to identify issues specific to a target business,
industry or the environment in which the target business operates, 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 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 Class A ordinary shares. 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 post- combination debt financing.
The requirement that we complete an initial
business combination before March 8, 2023 may give potential target businesses leverage over us in negotiating a business combination.
We have until March 8, 2023 to complete an initial
business combination. Any potential target business with which we enter into negotiations concerning a business combination will be aware
of this requirement. Consequently, such target business may obtain leverage over us in negotiating a business combination, knowing that
if we do not complete a business combination with that particular target business, we may be unable to complete a business combination
with any other target business. This risk will increase as we get closer to the time limit referenced above.
We may not be able to complete our initial
business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up
and we would redeem our public shares and liquidate, in which case our public shareholders may only receive $10.20 per share, or less
than such amount in certain circumstances, and our warrants will expire worthless.
Our amended and restated memorandum and articles
of association provides that we must complete our initial business combination by March 8, 2023. We may not be able to find a suitable
target business and complete our initial business combination within such time period. 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 coronavirus (COVID-19) pandemic continues to persist both in the U.S. and globally and, while the extent of the impact
of the COVID-19 pandemic 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 COVID-19 pandemic and other events (such as terrorist attacks, international unrest,
natural disasters or a significant outbreak of other infectious diseases) may negatively impact businesses we may seek to acquire.
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, divided by the number of then outstanding public shares, which redemption will completely
extinguish public shareholders’ rights as shareholders (including the right to receive further liquidating distributions, if any),
subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our
remaining shareholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Cayman Islands
law to provide for claims of creditors and the requirements of other applicable law. In such case, our public shareholders may only receive
$10.20 per share, and our warrants will expire worthless. In certain circumstances, our public shareholders may receive less than $10.20 per
share on the redemption of their shares. See “— If third parties bring claims against us, the proceeds held in trust could
be reduced and the per-share redemption price received by shareholders may be less than $10.20” and other risk factors.
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) pandemic and the status of debt and equity markets.
The coronavirus (COVID-19) pandemic has resulted,
and 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 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, or if COVID-19 causes a prolonged economic downturn. 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 business
combination 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 and third-party financing being unavailable on terms
acceptable to us or at all.
The COVID-19 pandemic may also have the effect
of heightening many of the other risks described in this “Risk Factors” section, such as those related to the market for our
securities and cross-border transactions.
We may not obtain a fairness opinion with
respect to the target business that we seek to acquire and therefore you may be relying solely on the judgment of our board of directors
in approving a proposed business combination.
We will only be required to obtain a fairness
opinion with respect to the target business that we seek to acquire if it is an entity that is affiliated with any of our sponsor, initial
shareholders, officers, directors or their affiliates. In all other instances, we will have no obligation to obtain an opinion. Accordingly,
investors will be relying solely on the judgment of our board of directors in approving a proposed business combination.
Resources could be spent researching acquisitions
that are not consummated, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business.
It is anticipated 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 a decision is made
not to complete a specific business combination, the costs incurred up to that point for the proposed transaction likely would not be
recoverable. Furthermore, even if an agreement is reached relating to a specific target business, we may fail to consummate the 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.
As the number of special purpose acquisition
companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets.
This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate
an initial business combination.
In recent years and especially in the last several
months, the number of special purpose acquisition companies that have been formed has increased substantially, especially in the past
year. Many potential targets for special purpose acquisition companies have already entered into an initial business combination, and
there are still many special purpose acquisition companies seeking targets for their initial business combination, as well as many such
companies currently in registration. As a result, at times, fewer attractive targets may be available, and it may require more time, more
effort and more resources to identify a suitable target and to consummate an initial business combination.
In addition, because there are more special purpose
acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets
with attractive fundamentals or business models may increase, which could cause targets companies to demand improved financial terms.
Attractive deals could also become scarcer for other reasons, such as economic or industry sector downturns, geopolitical tensions, or
increases in the cost of additional capital needed to close business combinations or operate targets post-business combination. This
could increase the cost of, delay or otherwise complicate or frustrate our ability to find and consummate an initial business combination,
and may result in our inability to consummate an initial business combination on terms favorable to our investors altogether.
Changes in the market for directors and
officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination.
In recent months, the market for directors and
officers liability insurance for special purpose acquisition companies has changed. The premiums charged for such policies have generally
increased and the terms of such policies have generally become less favorable. There can be no assurance that these trends will not continue.
The increased cost and decreased availability
of directors and officers liability insurance could make it more difficult and more expensive for us to negotiate an initial business
combination. In order to obtain directors and officers liability insurance or modify its coverage as a result of becoming a public company,
the post-business combination entity might need to incur greater expense, accept less favorable terms or both. However, any failure
to obtain adequate directors and officers liability insurance could have an adverse impact on the post-business combination’s
ability to attract and retain qualified officers and directors.
In addition, even after we were to complete an
initial business combination, our directors and officers could still be subject to potential liability from claims arising from conduct
alleged to have occurred prior to the initial business combination. As a result, in order to protect our directors and officers, the post-business combination
entity will likely need to purchase additional insurance with respect to any such claims (“run-off insurance”). The need
for run-off insurance would be an added expense for the post-business combination entity, and could interfere with or frustrate
our ability to consummate an initial business combination on terms favorable to our investors.
Compliance with the Sarbanes-Oxley Act
of 2002 will require substantial financial and management resources and may increase the time and costs of completing an acquisition.
Section 404 of the Sarbanes-Oxley Act
of 2002 requires that we evaluate and report on our system of internal controls and may require that we have such system of internal controls
audited beginning with our Annual Report on Form 10-K for the year ending December 31, 2022. If we fail to maintain the
adequacy of our internal controls, we could be subject to regulatory scrutiny, civil or criminal penalties and/or shareholder litigation.
Any inability to provide reliable financial reports could harm our business. Section 404 of the Sarbanes-Oxley Act also requires
that our independent registered public accounting firm report on management’s evaluation of our system of internal controls. A target
company may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of their internal controls. The
development of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and
costs necessary to complete any such acquisition. Furthermore, any failure to implement required new or improved controls, or difficulties
encountered in the implementation of adequate controls over our financial processes and reporting in the future, could harm our operating
results or cause us to fail to meet our reporting obligations. Inferior internal controls could also cause investors to lose confidence
in our reported financial information, which could have a negative effect on the trading price of our Class A ordinary shares.
Provisions in our amended and restated memorandum
and articles of association may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future
for our Class A ordinary shares and could entrench management.
Our amended and restated memorandum and articles
of association contains provisions that may discourage unsolicited takeover proposals that shareholders may consider to be in their best
interests. Our board of directors is divided into three classes, each of which will generally serve for a term of three years with only
one class of directors being elected in each year. As a result, at a given annual meeting only a minority of the board of directors may
be considered for election. Since our “staggered board” may prevent our shareholders from replacing a majority of our board
of directors at any given annual meeting, it may entrench management and discourage unsolicited shareholder proposals that may be in the
best interests of shareholders. Moreover, our board of directors has the ability to designate the terms of and issue new series of preferred
shares.
Because we must furnish our shareholders
with target business financial statements prepared in accordance with U.S. generally accepted accounting principles or international financial
reporting standards, we will not be able to complete a business combination with prospective target businesses unless their financial
statements are prepared in accordance with U.S. generally accepted accounting principles or international financial reporting standards.
The federal proxy rules require that a proxy statement
with respect to a vote on a business combination meeting certain financial significance tests include historical and/or pro forma financial
statement disclosure in periodic reports. 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, or GAAP, or international financial reporting standards,
or 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), or PCAOB. We will include the same financial statement
disclosure in connection with any tender offer documents we use, whether or not they are required under the tender offer rules. Additionally,
to the extent we furnish our shareholders with financial statements prepared in accordance with IFRS, such financial statements will need
to be audited in accordance with U.S. GAAP at the time of the consummation of the business combination. These financial statement requirements
may limit the pool of potential target businesses we may acquire.
We may issue our shares to investors in
connection with our initial business combination at a price that is less than the prevailing market price of our shares at that time.
In connection with our initial business combination,
we may issue shares to investors in private placement transactions (so-called PIPE transactions) at a price of $10.00 per share or
which approximates the per-share amounts in our trust account at such time, which is generally approximately $10.20. The purpose
of such issuances will be to enable us to provide sufficient liquidity to the post-business combination entity. The price of the
shares we issue may therefore be less, and potentially significantly less, than the market price for our shares at such time.
Changes in laws or regulations, or a failure
to comply with any laws and regulations, may adversely affect our business, investments 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 and results of operations.
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 currently operating in a period
of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing
military conflict between Russia and Ukraine. Our search for a business combination, and any target business with which we ultimately
consummate a business combination, may be materially adversely affected by any negative impact on the global economy and capital markets
resulting from the conflict in Ukraine or any other geopolitical tensions.
U.S. and global markets are experiencing volatility
and disruption following the escalation of geopolitical tensions and the start of the military conflict between Russia and Ukraine. On
February 24, 2022, a full-scale military invasion of Ukraine by Russian troops was reported. Although the length and impact of the ongoing
military conflict is highly unpredictable, the conflict in Ukraine could lead to market disruptions, including significant volatility
in commodity prices, credit and capital markets, as well as supply chain interruptions. In addition, although we may pursue an initial
business combination with any target business and in any sector or geographical location, we intend to focus our search on targets in
energy transition technologies, such as battery materials, energy storage, EV infrastructure and advanced recycling in emerging/frontier
countries including the CIS, South and South-East Asia and MENA regions. The military conflict between Russia and Ukraine and the resulting
sanctions may limit our target geographic region. We are continuing to monitor the situation in Ukraine and globally and assessing its
potential impact on our business. Additionally, Russia's prior annexation of Crimea, recent recognition of two separatist republics in
the Donetsk and Luhansk regions of Ukraine and subsequent military interventions in Ukraine have led to sanctions and other penalties
being levied by the United States, European Union and other countries against Russia, Belarus, the Crimea Region of Ukraine, the so-called
Donetsk People's Republic, and the so-called Luhansk People's Republic, including agreement to remove certain Russian financial institutions
from the Society for Worldwide Interbank Financial Telecommunication ("SWIFT") payment system, expansive ban on imports and
exports of products to and from Russia and ban on exportation of U.S denominated banknotes to Russia or persons locates there. Additional
potential sanctions and penalties have also been proposed and/or threatened. Russian military actions and the resulting sanctions could
adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets, potentially
making it more difficult for us to obtain additional funds. Any of the above-mentioned factors could affect our ability to search for
a target and consummate a business combination. The extent and duration of the military action, sanctions and resulting market disruptions
are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in this
Annual Report on Form 10-K.
Risks Associated with Acquiring and Operating
a Business Outside of the United States
If we effect a business combination with
a company located in CIS or another foreign jurisdiction in South and South-East Asia and MENA regions we would be subject to a variety
of additional risks that may negatively impact our operations.
If we are successful in consummating a business
combination with a target business in CIS, or if we effect a business combination with a company located in another foreign region, we
would be subject to any special considerations or risks associated with companies operating in the target business’ home jurisdiction,
including any of the following:
| ● | rules and regulations or currency conversion or corporate
withholding taxes on individuals; |
| ● | tariffs and trade barriers; |
| ● | regulations related to customs and import/export matters; |
| ● | 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; |
| ● | public health or safety concerns and governmental restrictions,
including those caused by outbreaks of infectious disease, such as the recent COVID-19 pandemic; |
| ● | crime, strikes, riots, civil disturbances, terrorist attacks
and wars, such as recent military action in Ukraine; and |
| ● | deterioration of political relations with the United States,
which could result in uncertainty and/or changes in or to existing trade treaties. |
In particular, if we acquire a target business
in CIS or another foreign jurisdiction in South and South-East Asia and MENA regions, we would be subject to the risk of changes
in economic conditions, social conditions and political conditions inherent in such jurisdiction, including changes in laws and policies
that govern foreign investment, as well as changes in United States laws and regulations relating to foreign trade and investment.
We cannot assure you that we would be able to adequately address these additional risks. If we were unable to do so, our operations might
suffer.
Emerging markets are subject to different
risks as compared to more developed markets.
Operating a business in CIS or another emerging
country in South and South-East Asia and MENA regions involves a greater degree of risk than operating a business in more developed
markets, including, in some cases, increased political, economic and legal risks. Emerging market governments and judiciaries often exercise
broad, unchecked discretion and are susceptible to abuse and corruption. Moreover, financial turmoil in any emerging market country tends
to adversely affect the value of investments in all emerging market countries as investors move their money to more stable, developed
markets. As has happened in the past, financial problems or an increase in the perceived risks associated with investing in companies
in emerging economies could dampen foreign investment in such countries and regions and adversely affect their economies. Generally, investment
in emerging markets is only suitable for sophisticated investors who fully appreciate the significance of the risks involved in, and are
familiar with, investing in emerging markets.
Our officers and directors may not have
significant experience or knowledge regarding the jurisdiction or industry of the target business we may seek to acquire.
We may consummate a business combination with
a target business in any geographic location or industry we choose. We cannot assure you that our officers and directors will have enough
experience or have sufficient knowledge relating to the jurisdiction of the target or its industry to make an informed decision regarding
a business combination.
Because of the costs and difficulties inherent
in managing cross-border business operations, our results of operations may be negatively impacted.
Managing a business, operations, personnel or
assets in another country is challenging and costly. Any management that we may have (whether based abroad or in the U.S.) may be inexperienced
in cross-border business practices and unaware of significant differences in accounting rules, legal regimes and labor practices.
Even with a seasoned and experienced management team, the costs and difficulties inherent in managing cross-border business operations,
personnel and assets can be significant (and much higher than in a purely domestic business) and may negatively impact our financial and
operational performance.
If our management following our initial
business combination is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar
with such laws, which could lead to various regulatory issues.
Following our initial business combination, our
management team may resign from their positions as officers or directors of the company and the management team of the target business
at the time of the business combination will likely remain in place. Management of the target business may not be familiar with United States
securities laws. If new management is unfamiliar with our laws, they may have to expend time and resources becoming familiar with such
laws. This could be expensive and time-consuming and could lead to various regulatory issues, which may adversely affect our operations.
If we effect a business combination with
a company located outside of the United States, the laws of the country in which such company operates will likely govern many of
our material agreements and we may not be able to enforce our legal rights.
If we effect a business combination with a company
located outside of the United States, the laws of the country in which such company operates will likely govern many of the material
agreements relating to its operations. We cannot assure you that the target business will be able to enforce any of its material agreements
or that remedies will be available in this new jurisdiction. The system of laws and the enforcement of existing laws in such jurisdiction
may not be certain in implementation and interpretation. The inability to enforce or obtain a remedy under any of our future agreements
could result in a significant loss of business, business opportunities or capital. Additionally, if we acquire a company located outside
of the United States, it is likely that substantially all of our assets would be located outside of the United States and some
of our officers and directors might reside outside of the United States. As a result, it may not be possible for investors in the
United States to enforce their legal rights against or to effect service of process upon our directors or officers or to enforce
judgments of United States courts predicated upon civil liabilities against our directors and officers under federal securities laws.
We may re-incorporate in another jurisdiction
in connection with our initial business combination, and the laws of such jurisdiction will likely govern all of our material agreements
and we may not be able to enforce our legal rights.
In connection with our initial business combination,
we may relocate the home jurisdiction of our business from the Cayman Islands to another jurisdiction. If we determine to do this, the
laws of such jurisdiction would likely govern all of our material agreements. The system of laws and the enforcement of existing laws
in such jurisdiction may not be as certain in implementation and interpretation as in the United States. The inability to enforce
or obtain a remedy under any of our future agreements could result in a significant loss of business, business opportunities or capital.
Any such reincorporation may subject us to foreign regulations that could materially and adversely affect our business.
After our initial business combination,
it is likely that a majority of our directors and officers will live outside the United States and all of our assets will be located
outside the United States; therefore investors may not be able to enforce federal securities laws or their other legal rights.
It is likely that after our initial business combination,
a majority of our directors and officers will reside outside of the United States and all of our assets will be located outside of
the United States. As a result, it may be difficult, or in some cases impossible, for investors in the United States to enforce
their legal rights against or to effect service of process upon all of our directors or officers or to enforce judgments of United States
courts predicated upon civil liabilities under United States laws.
We may migrate to another jurisdiction in
connection with our initial business combination and such migration may result in taxes imposed on shareholders.
As a Cayman Islands entity, we do not have access
to a network of income tax treaties to protect us from withholding taxes or gains taxes that may be imposed by other jurisdictions. As
a result, it may not be possible to effect repatriation of earnings or the receipt of income from our investments in a tax efficient manner.
Accordingly, we may, in connection with our initial business combination or earlier, and subject to requisite shareholder approval under
the Cayman Islands law, transfer by way of continuation (migrate) to a different jurisdiction, including, for example, the jurisdiction
in which the target company or business is located. Such a transaction may require a shareholder to recognize taxable income in the jurisdiction
in which the shareholder is a tax resident and/or the jurisdictions in which its owners are resident if it is a tax transparent entity
under the tax laws of such jurisdictions (including under any anti-deferral regime). We do not intend to make any cash distributions
to shareholders to pay such taxes. Shareholders may also be subject to withholding taxes or other taxes imposed by the jurisdiction where
we are migrated to with respect to their ownership of us.
There may be tax consequences to our business
combinations that may adversely affect us.
While we expect to undertake any merger or acquisition
so as to minimize taxes both to the acquired business and/or assets and us, such business combination might not meet the statutory requirements
of a tax-free reorganization, or the parties might not obtain the intended tax-free treatment upon a transfer of shares or assets.
A non-qualifying reorganization could result in the imposition of substantial taxes.
We may be a passive foreign investment company,
or “PFIC,” which could result in adverse U.S. federal income tax consequences to U.S. investors.
If we are a PFIC for any taxable year (or portion
thereof) that is included in the holding period of a U.S. holder (as defined in the section of this Annual Report captioned “Taxation
— United States Federal Income Taxation — General”) of our Class A ordinary shares or warrants, the U.S. holder may
be subject to adverse U.S. federal income tax consequences and may be subject to additional reporting requirements. Our PFIC status for
our current and subsequent taxable years may depend upon the status of an acquired company pursuant to a business combination and whether
we qualify for the PFIC start-up exception (see the section of this Annual Report captioned “Taxation — Material U.S.
Federal Income Tax Considerations — U.S. Holders — Passive Foreign Investment Company Rules”). The application of the
start-up exception is uncertain, and there can be no assurance that we will qualify for the start-up exception. Accordingly,
there can be no assurances with respect to our status as a PFIC for our current taxable year or any subsequent taxable year. Our actual
PFIC status for any taxable year will not be determinable until after the end of such taxable year. Moreover, if we determine we are a
PFIC for any taxable year, we will endeavor to provide a U.S. holder such information as the Internal Revenue Service (“IRS”)
may require, including a PFIC annual information statement in order to enable the U.S. holder to make and maintain a “qualified
electing fund” election, but there can be no assurance that we will timely provide such required information, and such election
would likely be unavailable with respect to our warrants in all cases. We urge U.S. holders to consult their tax advisors regarding the
possible application of the PFIC rules to holders of our Class A ordinary shares and warrants.
We have identified a material weakness in our
internal control over financial reporting as of December 31, 2021. If we are unable to develop and maintain an effective system of internal
control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely
affect investor confidence in us and materially and adversely affect our business and operating results.
We have identified a material weakness in our internal
controls over financial reporting related to the accounting for our complex financial instruments. In light of the material weakness identified,
although we have processes to identify and appropriately apply applicable accounting requirements, we plan to enhance our processes to
identify and appropriately apply applicable accounting requirements to better evaluate and understand the nuances of the complex accounting
standards that apply to our financial statements. Our plans at this time include providing enhanced access to accounting literature, research
materials and documents and increased communication among our personnel and third-party professionals with whom we consult regarding complex
accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these
initiatives will ultimately have the intended effects.
A material weakness is a deficiency, or a combination
of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement
of our annual or interim financial statements will not be prevented or, detected and corrected on a timely basis. Effective internal controls
are necessary for us to provide reliable financial reports and prevent fraud. We continue to evaluate steps to remediate the material
weakness. These remediation measures may be time consuming and costly and there is no assurance that these initiatives will ultimately
have the intended effects.
A material weakness could limit our ability to prevent
or detect a misstatement of our accounts or disclosures that could result in a material misstatement of our annual or interim financial
statements. In such a case, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic
reports in addition to applicable stock exchange listing requirements, investors may lose confidence in our financial reporting, our securities
price may decline and we may face litigation as a result. We cannot assure you that the measures we have taken to date, or any measures
we may take in the future, will be sufficient to avoid potential future material weaknesses.
Our independent registered public accounting
firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going
concern.”
As of December 31, 2021, we had working capital of
$1,200,917. Further, we have incurred and expect to continue to incur significant costs in pursuit of our finance and acquisition plans.
In addition, we expect to have negative cash flows from operations as we pursue an initial Business Combination target. Management’s
plans to address this need for capital through our initial Business Combination which are discussed elsewhere in this document. We cannot
assure you that our plans to raise capital or to consummate an initial business combination will be successful. These factors, among others,
raise substantial doubt about our ability to continue as a going concern. The financial statements contained elsewhere in this Form 10-K
do not include any adjustments that might result from our inability to continue as a going concern.