As filed with the Securities and Exchange Commission
on December 1, 2021.
Registration No. 333-260384
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1 to FORM S-1
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
WESTERN ACQUISITION VENTURES CORP.
(Exact name of registrant as specified in its charter)
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Delaware
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6770
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86-3720717
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(State or other jurisdiction of
incorporation or organization)
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(Primary Standard Industrial
Classification Code Number)
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(I.R.S. Employer
Identification Number)
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Western Acquisition Ventures Corp.
42 Broadway, 12th Floor
New York, New York 10004
Tel: 310-740-0710
(Address, including zip code, and telephone number,
including area code, of registrant’s principal
executive offices)
Stephen Christoffersen
Chief Executive Officer
Western Acquisition Ventures Corp.
42 Broadway, 12th Floor
New York, New York 10004
Tel: 310-740-0710
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copies to:
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Marc Hauser, Esq.
Aron Izower, Esq.
Wendy Grasso, Esq.
Reed Smith LLP
599 Lexington Avenue
New York, New York 10022
Telephone 212-521-5400
Facsimile 212-521-5450
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Oded Har-Even, Esq.
Ron Ben-Bassat, Esq.
Sullivan & Worcester LLP
1633 Broadway
New York, New York 10019
Telephone 212-660-3000
Facsimile 212-660-3001
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Approximate
date of commencement of proposed sale to the public: As soon as practicable after the effective date of this offering.
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415
under the Securities Act of 1933 check the following box. ¨
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act,
please check the following box and list the Securities Act registration statement number of the earlier effective registration statement
for the same offering. ¨
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box
and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
If
this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box
and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non- accelerated filer, or a smaller reporting company. See the definitions of “large
accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company”
in Rule 12b-2 of the Exchange Act:
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Large accelerated filer ¨
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Accelerated filer ¨
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Non-accelerated filer x
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Smaller reporting company x
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Emerging growth company x
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If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ¨
CALCULATION OF REGISTRATION FEE
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Title
of Each Class of Security being registered
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Amount
Being
Registered(2)
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Proposed
Maximum
Offering
Price per
Security(1)
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Proposed
Maximum
Aggregate
Offering
Price (1)(2)
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Amount
of
Registration
Fee
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Units,
each consisting of one share of common stock, $0.0001 par value and one Warrant entitling the holder to purchase three-quarters of
a share of common stock(2)
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11,500,000
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$
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10.00
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$
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115,000,000
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$
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10,660.50
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Shares
of common stock, $0.0001 par value, included as part of the units(3)
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11,500,000
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—
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—
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—
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(4)
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Warrants included as part of the units(3)
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11,500,000
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—
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—
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—
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(4)
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Total
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$
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115,000,000
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$
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10,660.50
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(5)
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(1)
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Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended.
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(2)
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Includes 1,500,000 units,
consisting of 1,500,000 shares of common stock and 1,500,000 redeemable warrants with each warrant entitling the holder to purchase
three-quarters of a share of common stock, which may be issued upon exercise of a 45-day option granted to the underwriters to cover
over-allotments, if any.
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(3)
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Pursuant to Rule 416, there are also being registered an indeterminable number of additional securities as may be issued to prevent dilution resulting from stock splits, stock dividends or similar transactions.
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(4)
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No fee pursuant to Rule 457(g).
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The Registrant hereby amends this Registration
Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment that
specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange
Commission, acting pursuant to said Section 8(a), may determine.
The information in this prospectus
is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange
Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities
in any jurisdiction where the offer or sale is not permitted.
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PRELIMINARY
PROSPECTUS
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SUBJECT
TO COMPLETION, DATED December 1, 2021
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$100,000,000
WESTERN ACQUISITION VENTURES CORP.
10,000,000 UNITS
Western Acquisition Ventures Corp., which we refer
to as “we,” “us” or “our company,” is a newly-organized blank check company incorporated in Delaware
and formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization,
or other similar initial business combination with one or more businesses or entities, which we refer to throughout this prospectus as
our “initial business combination.” Although we are not limited to a particular industry or geographic region for purposes
of consummating our initial business combination, we intend to focus on transactions with companies and assets with a broad reach
This is an initial public offering of our
securities. We are offering 10,000,000 units at an offering price of $10.00 per unit. Each unit consists of one share of common stock,
par value $0.0001, and one warrant, which we refer to throughout this prospectus as “warrants” or the “public warrants.”
Each warrant entitles the holder thereof to purchase three-quarters (3/4) of a share of common stock at a price of $11.50 per whole share,
subject to adjustment as described in the prospectus. We will not issue fractional shares. As a result, you must exercise public warrants
in multiples of four warrants, at a price of $11.50 per whole share, subject to adjustment as described in this prospectus, to validly
exercise your warrants. Each warrant will become exercisable on the on the later of one year after the closing of this offering or the
consummation of our initial business combination, and will expire five years after the completion of our initial business combination,
or earlier upon redemption.
We have also granted A.G.P./Alliance Global
Partners, or A.G.P., the representative of the underwriters, a 45-day option to purchase up to an additional 1,500,000 units (over and
above the 10,000,000 units referred to above) solely to cover over-allotments, if any.
We will provide the holders of our outstanding
shares of common stock that were sold as part of the units in this offering with the opportunity to redeem their shares of common stock
upon the consummation of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on
deposit in the trust account described below, including interest (net of taxes payable and up to $100,000 of interest to pay dissolution
costs and expenses), divided by the number of then-outstanding shares of common stock that were sold as part of the units in this offering,
which we refer to as our “public shares.”
We will have up to 12 months from the closing
of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial
business combination within 12 months, we may, by resolution of our board of directors if requested by our sponsor, extend twice the
period of time we will have to consummate an initial business combination by an additional 3 months (for a total of 18 months from the
closing of this offering); provided, that, pursuant to the terms of our amended and restated certificate of incorporation and the trust
agreement to be entered into between us and American Stock Transfer & Trust Company on the date of this prospectus, the only way
to extend the time available for us to consummate our initial business combination in the absence of a definitive agreement is for our
sponsor or its affiliates or designees, upon 5 days’ advance notice prior to the applicable deadline, to deposit into the trust
account $1,000,000, or $1,150,000 if the over-allotment option is exercised in full ($0.10 per share in either case) for each 3-month
extension, or prior to the date of the applicable deadline. Our public stockholders will not be entitled to vote or redeem their shares
in connection with such extension.
If we are unable to complete our initial business
combination within 12 months (or up to 18 months, if extended) from the closing of this offering, we will distribute the aggregate amount
then on deposit in the trust account, pro rata to our public stockholders, by way of the redemption of their shares and thereafter cease
all operations except for the purposes of winding up of our affairs, as further described herein. In such event, the warrants will expire
and be worthless.
Our sponsor, Western Acquisition Ventures
Sponsor LLC, and an affiliate of A.G.P., together own an aggregate of 2,875,000 shares of our common stock (up to 375,000 shares of which
are subject to forfeiture depending on the extent to which the underwriters’ over-allotment option is exercised).
Our sponsor has agreed to purchase an aggregate
of 361,000 units (or up to 376,000 units depending on the extent to which the underwriters’ over-allotment option is exercised),
at $10.00 per unit for a total purchase price of $3,610,000 (or up to $3,760,000
depending on the extent to which the underwriters’ over-allotment option is exercised) on a private placement basis simultaneously
with the consummation of this offering and regardless of whether the underwriters’ over-allotment option is exercised. The private
placement units are identical to the units sold in this offering, subject to certain limited exceptions as described in this prospectus.
There will be no underwriting fees or commissions with respect to the private placement units.
There is presently no public market for our
units, common stock, or warrants. We intend to apply to have our units listed on The Nasdaq Global Market, or Nasdaq, under the symbol
“WAVSU” on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing
on Nasdaq. Once the securities comprising the units begin separate trading as described in this prospectus, the shares of common stock
and warrants will be traded on Nasdaq under the symbols “WAVS” and “WAVSW” respectively. We cannot assure you
that our securities will continue to be listed on Nasdaq after this offering.
We are an “emerging growth company”
as defined in the Jumpstart Our Business Startups Act of 2012 and will therefore be subject to reduced public company reporting requirements.
Investing in our securities involves a high
degree of risk. See “Risk Factors” beginning on page 29 of this prospectus for a discussion of information that should
be considered in connection with an investment in our securities.
Neither the Securities and Exchange Commission
nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.
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Price
to
Public
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Underwriting
Discount and
Commissions(1)
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Proceeds,
Before
Expenses,
to us
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Per unit
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$
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10.00
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$
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0.05
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$
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9.95
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Total
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$
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100,000,000
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$
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500,000
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$
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99,500,000
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(1)
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The underwriters will
receive compensation in addition to the underwriting discount. A.G.P., as the representative of the underwriters, will receive compensation
in addition to the underwriting discount, including 750,000 representative shares that were previously transferred by our sponsor
to an affiliate of A.G.P., 97,826 of which are subject to forfeiture if the over-allotment option is not exercised. See “Underwriting
- Conflicts of Interest” for further information relating to the underwriting compensation we will pay in this offering and
fees payable to A.G.P. upon the consummation of the initial business combination.
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A.G.P. has a “conflict of interest” within the meaning
of Financial Industry Regulatory Authority, or FINRA Rule 5121(f)(5)(B) in this offering because, prior to this offering, it
beneficially owns more than 10% of our shares. Due to this conflict of interest, The Benchmark Company, LLC, is acting as a “qualified
independent underwriter” in accordance with FINRA Rule 5121, which requires, among other things, that a qualified independent
underwriter participate in the preparation of, and exercise the usual standards of “due diligence” with respect to, this prospectus
and the registration statement of which it forms a part. The Benchmark Company, LLC will be paid a fee of $100,000 from the total underwriting
discount in this offering in consideration of its services and expenses as qualified independent underwriter. See “Underwriting
— Conflicts of Interest” for further information.
Upon consummation of the offering, $10.10
per unit sold to the public in this offering (whether or not the over-allotment option has been exercised in full or part) will be deposited
into a United States-based trust account at American Stock Transfer & Trust Company, LLC acting as trustee. Except as described
in this prospectus, these funds will not be released to us until the earlier of the completion of our initial business combination and
our redemption of the public shares upon our failure to consummate an initial business combination within the required period.
The underwriters are offering the units on
a firm commitment basis. A.G.P./Alliance Global Partners, acting as the sole book-running manager, expects to deliver the units to purchasers
on or about December 1, 2021.
Sole Book-Running Manager
A.G.P.
Co-Manager
Brookline
Capital Markets
a division of Arcadia
Securities, LLC
Qualified Independent
Underwriter
The Benchmark
Company, LLC
, 2021
WESTERN ACQUISITION VENTURES CORP.
TABLE OF CONTENTS
SUMMARY
This summary only highlights the more detailed
information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider
in making an investment decision. You should read this entire prospectus carefully, including the information under “Risk Factors”,
and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in
this prospectus:
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“we,” “us” or “our company” refers to Western Acquisition Ventures Corp.;
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“A.G.P.” or “representative” refers to A.G.P./Alliance Global Partners, which is the representative of the underwriters in this offering;
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“initial stockholders” refers to all of our stockholders immediately prior to the date of this prospectus, including our sponsor, officers and directors, and the representative, each to the extent they hold such shares;
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“initial business combination” refers to our initial merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination;
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“insider shares”
or “founder shares” refers to the aggregate 2,125,000 shares of common stock held by our sponsor and the 750,000 representative
shares (including up to an aggregate of 375,000 shares of common stock subject to forfeiture to the extent that the underwriters’
over-allotment option is not exercised in full or in part);
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“private placement”
refers to the private placement of 361,000 (or up to 376,000 depending on the extent to which the underwriters’ over-allotment
option is exercised), private placement units at a price of $10.00 per private placement unit, for an aggregate purchase price of
$3,610,000 (or up to $3,760,000 depending on the extent to which the underwriters’ over-allotment option is exercised), which
will occur simultaneously with the completion of this offering;
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“private placement units” refers to the units issued to our sponsor in a private placement simultaneously with the closing of this offering, which private placement units are identical to the units sold in this offering, subject to certain limited exceptions as described in this prospectus;
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“private placement warrants” refers to the warrants underlying the private placement
units that are being issued to our sponsor in a private placement simultaneously with the closing of this offering, which private
placement warrants are identical to the public warrants sold in this offering, subject to certain limited exceptions as described
in this prospectus;
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“public shares” refers to shares of our common stock sold as part of the units in
this offering (whether they are purchased in this offering or thereafter in the open market);
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“public stockholders” refers to the holders of our public shares, whether they purchased such public shares in the public offering or thereafter in the open market, including any of our initial stockholders to the extent that they purchase such public shares (except that our initial stockholders will not have conversion or tender rights with respect to any public shares they own);
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“public units” refers to the units
sold in this offering (whether they are purchased in this offering or thereafter in the open market);
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“public warrants” refers to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market, including warrants that may be acquired by our sponsor or its affiliates in this offering or thereafter in the open market);
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“representative” refers to A.G.P./Alliance Global Partners, which is the representative of the underwriters in this offering;
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“representative
shares” refers to 750,000 shares of our common stock transferred from our sponsor to an affiliate of A.G.P. as compensation
to the representative and its designees, 97,826 shares of common stock of which are subject to forfeiture if the over-allotment option
is not exercised; and
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“sponsor” refers to Western Acquisition Ventures Sponsor LLC.
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Unless we tell you otherwise, the information
in this prospectus assumes that the underwriters will not exercise their over-allotment option.
Certain financial information contained in
this prospectus has been rounded and, as a result, certain totals shown in this prospectus may not equal the arithmetic sum of the figures
that should otherwise aggregate to those totals.
You should rely only on the information contained
in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not,
and the underwriters are not, making an offer of these securities in any jurisdiction where the offer is not permitted.
Our Company
We are a blank check company recently incorporated
as a Delaware corporation for the purpose of effecting our initial business combination. Our team of experienced executives, entrepreneurs,
and investors has a demonstrated track record of stakeholder value creation across multiple sectors and at different stages of growth.
As discussed further below, we seek to leverage
and capitalize on our collective multi-faceted expertise, investing and operating experience, and broad network of relationships
to source and evaluate potential transactions and create value for our stakeholders. We believe we have a deep and broad network of relationships
and sector expertise to source and evaluate potential transactions, enhancing our ability to position us as a partner of choice with potential
target companies. The extensive investing track record and operational experience of the management team and our board of directors, including
significant public company executive and board experience are expected to enhance our credibility with prospective targets, and will allow
us to be a value-added partner to the management team and stakeholders following our initial business combination. We believe our
extensive M&A and capital markets experience, including SPAC experience, will enable us to execute successfully our initial business
combination transaction. In addition, we believe having Alliance Global Partners as a significant stakeholder in us will serve as a key
competitive advantage given their extensive access to deal flow.
We may pursue our initial business combination
in any business or industry but intend to focus our search on a target business in an industry where we believe the expertise of our management
team and our board of directors will provide us with a competitive advantage in completing a successful initial business combination.
We intend to seek to acquire one or more businesses with an aggregate enterprise value in excess of $500 million, determined in the sole
discretion of our officers and directors according to reasonably acceptable valuation standards and methodologies, although a target entity
with a smaller or larger enterprise value may be considered.
Our Management Team
Our
Chief Executive Officer Stephen Christoffersen and our Chief Financial Officer William (Bill) Lischak collectively have over fifty years
of industry and investment experience. Together with our board of directors, our team has combined decades of experience in growing and
developing private and public companies across a range of sectors and industries. The team consists of Stephen Christoffersen, William
Lischak, along with Ade Okunubi, Ali Jahangiri, Robin L. Smith, and Adam K. Stern as directors. We believe that the strong operating,
industry and investment background of our management and directors, combined with their entrepreneurial expertise, will propel the company
to identify a valuable acquisition target that can thrive in a public-listing environment.
Our board members have extensive experience, having
served as directors or officers for numerous publicly listed and privately-owned companies. Our directors have experience with acquisitions,
divestitures and corporate strategy and implementation, which we believe will significantly benefit us as we evaluate potential acquisition
or merger candidates as well as following the completion of our initial business combination.
Stephen
Christoffersen, CFA, our Chief Executive Officer and a Director Nominee, is an entrepreneur and investor with a
proven track record in capital markets, consumer packaged goods, and emerging growth industries. As Chief Financial Officer of
KushCo Holdings Inc. (OTCQX:KSHB), where he has worked since 2018, Mr. Christoffersen spearheaded KushCo’s strategic plan
to right-size the business, align with the leading operators in the legal cannabis industry, and help KushCo achieve profitability
for the first time in more than three years. Mr. Christoffersen led the negotiations of a definitive merger agreement between
KushCo and Greenlane Holdings (NASDAQ: GNLN) which was announced March 2021 and actively led KushCo’s capital raising
efforts, partnerships and strategic investments, including securing KushCo’s line of credit with Monroe Capital LLC, its
partnership with C.A. Fortune, and its investment in and partnership with XS Financial, Inc., where Mr. Christoffersen
currently serves as a Board member (CSE: XSF).
Prior to joining KushCo, Mr. Christoffersen
served as Vice President, Investment Strategist for Comerica Asset Management Inc. (NYSE: CMA), from 2017 to 2018, where he managed
a $500 million equity portfolio, oversaw asset allocation and investments. During that time he also advised on M&A and fundraising
initiatives for several seed and growth stage companies, such as SkinnyFats, LLC and Summit Innovations LLC. From 2015 to 2018,
Mr. Christoffersen served as the Chief Financial Officer and Chief Operating Officer of Lawless Jerky, LLC, where he led its financing
rounds and was the financial architect behind an exit to a strategic partnership with Monogram Foods Solutions, LLC.
Mr. Christoffersen has also been active in
several volunteering and philanthropic initiatives, including serving as a Math and Science tutor with the Save a Child Foundation at
the YMCA Boys and Girls Club. He is also an Executive Sponsor for Project Mission Green, an initiative of The Weldon Project that advocates
on behalf of currently or formerly incarcerated cannabis offenders who were sentenced to prison for nonviolent cannabis offenses.
Mr. Christoffersen received his Chartered
Financial Analyst designation in 2015 and holds a Bachelor of Science degree in Finance from the University of Nevada, Las Vegas.
William
Lischak, CPA, MST, our Chief Financial Officer and a Director, is a senior level financial executive with over 20 years
of experience in the media industry. His credentials include being a CPA and having earned a master’s degree in Taxation. Mr. Lischak
has extensive M&A, corporate finance, accounting, tax, and strategic planning experience. Bill has developed a strong network of relationships
with commercial and investment banks, law firms, accounting firms, and consulting firms, and is known as a dynamic team player strongly
committed to working with colleagues to achieve transactional and operational goals.
Mr. Lischak has been the Chief Executive
Officer of RightsTrade, LLC since June 2020 and worked as a consultant to the company since April 2019. Concurrently, starting
in February 2020, Mr. Lischak has acted as interim CFO for Johnson Management Group, a privately held television movie production
company. From February 2017 to October 2018, Mr. Lischak served as interim CFO at PIXOMONDO STUDIOS Gmbh & Company
KG, a multi-national visual effects company. Working in conjunction with Houlihan Lokey, Inc., Mr. Lischak managed the company
through the process of preparing for, seeking, securing and concluding a majority stake sale to private equity, which closed in July 2018.
From 2007 to 2015 Mr. Lischak worked with
OddLot Entertainment LLC, a film and television production company founded by Gigi Pritzker, where he established the company’s
position as a prominent independent production company by securing, structuring and managing corporate joint ventures and complex multi-party
project financing for award winning and commercially successful films such as Hell or High Water (nominated for a Best Picture
Academy Award), Ender’s Game (at the time, the largest independent film ever made, with a budget of $115 million), and Drive
(which won Best Director at the Cannes Film Festival). Additionally, Mr. Lischak was instrumental in the company’s expansion
into television production with National Geographic’s Genius: Einstein mini-series (based upon the Walter Isaacson biography),
produced in conjunction with Ron Howard’s Imagine Entertainment. Corporately, Mr. Lischak created a multi-picture production
and distribution arrangement with Lions Gate Entertainment Corporation (NYSE: LGF); spearheaded a multi-picture production and distribution
arrangement with STX Financing LLC (NYSE: ESGC) in conjunction with an equity investment by Ms. Pritzker’s family office and
JPMorgan Chase Bank, N.A.; and created the joint venture international sales company, Sierra/Affinity (acquired by Entertainment One Ltd.
and Hasbro, Inc.).
Prior to joining Oddlot Entertainment LLC, Mr. Lischak
worked with First Look Media, a multi-faceted production and distribution operation. Joining the company in 1988 as CFO, Mr. Lischak
later assumed the roles of COO and President and was instrumental in the development and growth of the company, including its’ merger
into a SPAC. In addition to the SPAC transaction, Mr. Lischak spearheaded multiple rounds of additional capital (pre and post public
company status), various corporate acquisitions and established a multitude of debt financing arrangements including both lines of credit
and project financing with financial institutions including JPMorgan Chase Bank, N.A (NYSE: JPM)., Comerica, Inc. (NYSE: CMA), Merrill
Lynch Wealth Management and NatWest Group, among others. During Bill’s tenure annual revenues increased from $6 million to $125
million.
Mr. Lischak graduated from NYU’s Stern
School of Business, where he also studied film at NYU’s Tisch School of the Arts. We believe that Mr. Lischak’s management
and business experience make him well-suited to serve as a member of our board of directors.
Ade
Okunubi, MBA, CFA, a Director Nominee, is President of Industrial Battery Inc., an industrial battery and charger distributor
and service firm. Mr. Okunubi is also a Private Equity investor in Industrial services businesses. Prior to acquiring Industrial
Battery, Mr. Okunubi served as Chief Operating Officer of Techni-Tool, part of TestEquity LLC, a distributor of equipment for electronic
production assembly, and Investment Associate for Arcis Equity Partners LLC, a leisure and hospitality focused private equity fund.
Prior to working in private equity and in operation
roles, Mr. Okunubi worked in the Mergers & Acquisitions group at Credit Suisse Group AG (NYSE: CS) and advised private equity
firms and corporations on approximately $2.5 billion in transactions in the telecom, healthcare, retail and renewable energy sectors.
Prior to Credit Suisse Group AG, Mr. Okunubi was a Merger Arbitrage and High Yield Credit Trader at Taconic Capital Advisors LP,
a New York-based event driven hedge fund.
Mr. Okunubi, a Queens, NY native, received
an AB in Economics from Princeton University, and a MBA from the Harvard Business School. Mr. Okunubi is also a CFA Charter holder
and member of the CFA Society of Dallas-Ft. Worth. We believe Mr. Okunubi is well qualified to serve as an independent member of
our board of directors because of his management experience and his extensive financial experience
as an investor.
Ali
Jahangiri, JD, a Director Nominee, is the Founder of Opportunity Zone Expo and Opportunity
Zone Magazine, and has been since 2018. He is also the founder of Eb5investors and Uglobal in 2012, which serve the investment immigration
industry as the industry trade publication and one of the largest international conference series. Mr. Jahangiri is also the CEO
of Outclick Media, which among the other publishing sites also manages and operates colonoscopy.com and Hotelsmag.com
Mr. Jahangiri began his career
practicing corporate law at Stradling Yocca Carlson & Rauth, but shifted his focus to publishing, where he pioneered multiple
digital portals in healthcare and law, which were acquired in 2009 and 2011, respectively.
Mr. Jahangiri
also serves on the Film Commission of California and board of overseers of Loyola Law School. Mr. Jahangiri received a Bachelors
degree from UC Irvine and a law degree from Loyola Law School. We believe Mr. Jahangiri is well qualified to serve as an independent
member of our board of directors because of his extensive entrepreneurial experience.
Robin
L. Smith, MD, MBA, a Director Nominee, is a business leader, entrepreneur, medical doctor, and philanthropist uniquely positioned
to assist public companies and health care systems to advance and be successful in the rapidly evolving health care industry. She is a
trailblazer in the fields of regenerative medicine and predictive analytics and has focused on turnarounds, M&A and disruptive innovations
driving interest and growth.
From 2006 until 2015, Dr. Smith was chairman
and chief executive officer of the NeoStem, Inc. (NASDAQ: NBS), where she pioneered the company’s innovative business model
combining proprietary cell therapy development with successful contract development and manufacturing organization that was sold to Hitachi, Ltd.
(TYO: 6501) at 8x the price at which it had been acquired. During her 9 years of tenure, the company completed five acquisitions, one
divestiture and won an array of industry awards and received business recognition including a first-place ranking in the tri-state area
(two years in a row), and eleventh place nationally, on Deloitte’s Technology Fast 500, and Frost & Sullivan’s North
American Cell Therapeutics Technology Innovation Leadership Award. In 2015, Dr. Smith was asked to become chair of the board
of directors of Mynd Analytics, Inc. (NASDAQ: MYND) and successfully turn the business around through acquisitions and divestitures
and brought liquidity to investors. In 2017, she founded Spiritus Therapeutics, Inc., a company in the exosome therapeutic area.
Dr. Smith
has extensive experience serving on the boards of directors and board committees, including, audit, nominating and governance, compensation
and science and technology committees, of multiple public companies and private companies. She serves as a director of: Sorrento
Therapeutics, Inc. (NASDAQ: SRNE); Celularity, Inc. (soon to de-SPAC with NASDAQ: GXGX); Vicinity, Inc.; and, Spiritus
Therapeutics, Inc. Dr. Smith has also served on the board of ServiceSource International, Inc. (NASDAQ: SREV), of Seelos
Therapeutics, Inc. (NASDAQ: SEEL), Rockwell Medical, Inc. (NASDAQ: RMTI), and BioXcel Corp.
Dr. Smith
co-authored Cells Are the New Cure (2017) and The Healing Cell: How the Greatest Revolution in Medical History
Is Changing Your Life (2013). She has also been widely recognized for her leadership in health care and as a female entrepreneur.
Most recently, Dr. Smith received the Regenerative Medicine Foundation (RMF) 2019 Stem Cell and Regenerative Medicine Action
Award for International Diplomacy in 2019 and the 2018 HEALinc Future Health Humanitarian Award, the Business Intelligence Group’s
Woman of the Year Award in 2018 and the 2018 Gold Stevie® Award for Woman of the Year – Government or Non-Profit.
In May 2016, Pope Francis awarded Dr. Smith Dame Commander with Star Pontifical Equestrian Order of Saint Sylvester Pope and
Martyr. In May 2017, she was awarded the Lifetime Achievement in Healthcare and Science Award by The National Museum of Catholic
Art and Library.
Dr. Smith
is also active in many nonprofit organizations. She is the founder, president and chairperson of the board of the Cura Foundation, a charitable
organization, and a member, serves on the board of overseers of the New York University Langone Medical Center and on the board of trustees
of Sanford Health. She currently serves on the board of Alliance for Cell Therapy and served on the board of the Alliance for Regenerative
Medicine (ARM) Foundation, Unite to Prevent Cancer (UTPC) Foundation now OPA and on the board of trustees of the New York University Langone
Medical Center and was chairperson of our board of directors of the New York University Hospital for Joint Diseases.
Dr. Smith
received her B.A. degree from Yale University and her M.D. degree from the Yale School of Medicine. Dr. Smith holds an M.B.A. degree
from the Wharton School of Business and completed the Stanford University Directors Program. In 2019, Dr. Smith received an honorary
doctor of science degree from Thomas Jefferson Medical College. We believe Dr. Smith is well qualified to serve as an independent
member of our board of directors because of her experience in leadership and management roles and
her experience as a board member in various public companies.
Adam
K. Stern, a Director Nominee, is the CEO of SternAegis Ventures and has been the Head of Private Equity Banking at Aegis Capital
Corp. since 2012. Prior to SternAegis, from 1997 to 2012, he was Senior Managing Director at Spencer Trask Ventures, Inc., where
he managed the structured finance group focusing primarily on technology and life science companies. From 1989 to 1997, Mr. Stern
was at Josephthal & Co., Inc., Members of the New York Stock Exchange, where he served as Head of Private Equity and Managing
Director. He has been a FINRA licensed securities broker since 1987 and a Registered General Securities Principal since 1991. Mr. Stern
has been a founding investor in numerous private and public companies and currently serves as a Director of DarioHealth Corp. (Nasdaq:
DRIO) since March 2020, Organovo Holdings Inc., (Nasdaq: ONVO) since July 2020, and privately held Aerami Therapeutics, Inc.
since 2014. Adam previously served on the board of directors for Matinas BioPharma Holdings, Inc. (NYSE: MTNB) from 2012-2020, and
HydroFarm Holdings, Inc. (Nasdaq: HYFM) from 2018-2020.
Mr. Stern graduated from the University of
South Florida in 1987. We believe Mr. Stern is well qualified to serve as an independent member of our board of directors because
of his experience as a board member of numerous public companies, as well as his deep financial
experience as an investor.
The past performance of the members of our management
team and board of directors or their affiliates is not a guarantee that we will be able to identify a suitable candidate for our initial
business combination or of success with respect to any initial business combination we may consummate. You should not rely on the historical
record of the performance of our management team or any of its affiliates’ performance as indicative of our future performance.
Business Strategy
Our objectives are to generate attractive returns
for stockholders and enhance value through (1) completing our initial business combination with a high-quality merger target
at an attractive valuation with favorable terms for our stockholders and (2) enhancing operational performance through our team’s
experience and by leveraging our expertise and the expertise of our network. We expect to favor potential target companies with certain
industry and business characteristics. Key favorable industry characteristics we look for include, but are not limited to, compelling
long-term growth prospects, strong secular tailwinds, and highly fragmented markets ripe for consolidation opportunities. We expect our
target to possess certain business characteristics such as a leading market position, significant recurring revenue with a diversified
customer base, opportunity for operational improvement, and a healthy margin profile with attractive free cash flow characteristics.
As we consider specific sectors of focus, we will
be guided by three key factors. First, our significant industry and operational expertise. Second, the long-term impact of the COVID-19 pandemic
as an accelerant of business practices and industry changes. Finally, targeting merger candidates where conditions allow us to influence
sufficiently the outcome to produce attractive economic rewards for our stockholders and stakeholders. Our target sectors may include,
but are not limited to: infrastructure and environmental services; health, wellness and food sustainability; financial technology and
financial services; enterprise software and SaaS; and leisure and hospitality.
Our selection process will leverage our network
of varied industry, investment banker, private equity and venture capital, credit fund, and lending community relationships, as well as
our relationships with management teams of public and private companies, restructuring advisers, attorneys and accountants, which we believe
should provide us with a number of high-quality initial business combination opportunities. We intend to deploy a proactive, thematic
sourcing strategy and to focus on companies where we believe the combination of our operating experience, relationships, capital and capital
markets expertise can be catalysts to change a target company and can help accelerate the target’s growth and performance.
Our management team and board of directors
has experience in:
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sourcing, structuring, acquiring and selling businesses;
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operating companies, implementing and executing change-driven strategies, and identifying, monitoring
and recruiting industry-leading talent;
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fostering relationships with sellers, capital providers and target management teams;
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negotiating transactions favorable to investors;
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executing transactions in multiple geographies and under varying economic and financial market conditions;
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improving the strategic, operational, organizational and financial effectiveness of companies;
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accessing capital markets, including financing businesses, and managing or assisting companies transitioning
from private to public ownership;
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acquiring and integrating companies; and
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developing and growing companies, both organically and inorganically and expanding the product range and
geographic footprint of a number of target businesses.
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Competitive Advantages
We believe our competitive strengths include
the following:
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Depth of Team and Access to Resources: We have a dedicated management team with a track record
of executing on transactions, and the resources to source and evaluate a large number of potential transactions.
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Renowned board of directors: We believe that our ability to leverage the experience of our board
of directors, comprising senior operating executives across multiple sectors and industries, will provide us with a distinct advantage
in being able to source, evaluate and consummate an attractive transaction.
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Sourcing Channels and Leading Industry Relationships: We believe our capabilities, reputation,
and deeply-varied industry relationships will provide us with a differentiated pipeline of acquisition opportunities that would be difficult
for other participants in the market to replicate.
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SPAC Experience: Certain members of our management and advisor teams have significant SPAC experience
as founders, investors, and advisors in SPAC transactions. We believe their experience in SPAC transactions provide us with a distinct
advantage with respect to understanding the process of sourcing, evaluating and executing on our initial business combination, as well
as positioning us as an attractive partner for prospective target companies compared to first-time SPACs with no such prior experience.
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Execution and Structuring Capability: We believe our management team and board of directors’
combined expertise and reputation will allow us to source and complete a transaction possessing structural attributes that create an attractive
investment thesis. These types of transactions are typically complex and require creativity, industry knowledge and expertise, rigorous
due diligence, and extensive negotiations and documentation. We believe that by focusing our investment activities on these types of transactions,
we can generate investment opportunities that have attractive risk/reward profiles based on their valuations and structural characteristics.
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Public Company Experience: Certain members of our management team and board of directors have extensive
experience as public company executives and/or board members. This experience will serve as a key competitive advantage in selecting companies
that will benefit from going public, positioning us as an attractive partner to management teams of potential target companies, and help
to create long-term value post-closing of our initial business combination.
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Investment Criteria
We will use the following investment criteria
to screen for and evaluate target businesses although we may pursue opportunities outside of this scope.
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Small/Mid-cap Business: We intend to seek to acquire one or more businesses with an aggregate
enterprise value in excess of $500 million, determined in the sole discretion of our management team according to reasonably acceptable
valuation standards and methodologies, although a target entity with a smaller or larger enterprise value may be considered. Although
we have no commitment as of the date of this offering, we expect to issue a substantial number of additional shares of common
stock or shares of preferred stock, or a combination thereof, to complete an initial business combination. We believe the small- and mid-cap segment
provides the greatest number of opportunities to invest in an attractive target.
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Public Company Ready: We will seek to acquire a company that is well-positioned to be a public
company in terms of scale and size, and a company that public equity market investors will understand and value. While we believe our
public company experience will be a significant asset as a transaction partner to private companies, we intend to avoid companies that
have significant deficiencies in financial reporting or general public company readiness.
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Generates Stable Free Cash-Flow and/or Annual Recurring Revenue: We will seek to acquire a
business that has historically generated, or has the near-term potential to generate, strong and sustainable free cash flow. We also
believe that certain business models such as SaaS businesses, financial technology or enterprise software businesses have sustainable
annual recurring revenue and are platforms that can be used to create attractively valued public companies.
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Would Benefit Distinctly from our Capabilities: We will seek to acquire a business where we can
tangibly improve the operations and create long-term value for our stockholders. In particular, we believe our experience in operating
and improving public companies, as well as serving on public company boards, would be a value-add to the management teams and boards
of potential target companies.
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Is Sourced Through our Proprietary Channels: We believe the strength of our network will allow
us to source differentiated targets, and even in competitive situations, we believe we would be able to leverage our proprietary relationships
and/or insights into potential targets that will create competitive advantages for us.
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Has a Dedicated and Proven Management Team: We will seek to acquire a business with a professional
management team whose interests are aligned with those of our investors. Where necessary, we may also look to complement and enhance the
capabilities of the target business’s management team by recruiting additional talent through our network of contacts.
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These criteria are not intended to be exhaustive.
Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general
guidelines as well as on other considerations, factors and criteria that our management may deem relevant. In the event that we decide
to enter into our initial 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 in our stockholder communications related to our initial business combination,
which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file
with the SEC.
Our Acquisition Process
While we have not selected any specific initial
business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly,
with any initial business combination target with respect to our initial business combination with us, we have begun, and will continue
to actively engage in, an extensive research effort to identify a large number of potential targets.
We intend to leverage our resources and network
for efficient outreach to commence immediately after the date of this prospectus. Our effort will be focused on creating proprietary transaction
opportunities. We believe personal relationships built over time are critical not just in generating transaction opportunities, but also
in consummating an initial business combination. In evaluating a prospective target business, we expect to conduct a thorough due diligence
review which will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities,
as well as a review of financial, operational, legal and other information which will be made available to us.
We
are not prohibited from pursuing our initial business combination with a company 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 and disinterested directors, will obtain an opinion from an independent investment banking
firm, or another independent entity that commonly renders valuation opinions, that such initial business combination is fair to our company
from a financial point of view.
Our
initial stockholders, officers, and directors will directly or indirectly own our securities following this offering, and accordingly,
they 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 initial business combination if the retention or resignation of any such officers and directors was included by a target
business as a condition to any agreement with respect to our initial business combination.
Members of our management team or board of directors
may from time to time become aware of potential business opportunities, one or more of which we may desire to pursue, for an initial business
combination, but we have not (nor has anyone on our behalf) engaged in any substantive discussions, directly or indirectly, with any initial
business combination target with respect to an initial business combination transaction with us.
Our Initial Business Combination Process
In evaluating prospective initial business combinations,
we expect to conduct a thorough due diligence review process that may encompass, among other things, a review of historical and projected
financial and operating data, meetings with management and their advisors (if applicable), on-site inspection of facilities and assets,
discussion with customers and suppliers, legal reviews and other reviews as we deem appropriate. We will leverage our operational and
capital allocation experience in order to:
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Assemble a team of industry and financial experts: For each potential transaction, we intend to assemble
a team of industry and financial experts to supplement our management’s efforts to identify and resolve key issues facing the company.
We intend to construct an operating and financial plan which optimizes the potential to grow stockholder value. With extensive experience
investing in both healthy and underperforming businesses, we expect that our management will be able to demonstrate to the target business
and its stakeholders that we have the resources and expertise to lead the combined company through complex and often turbulent market
conditions and provide the strategic and operational direction necessary to grow the business in order to maximize cash flows and improve
the overall strategic prospects for the business;
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Conduct rigorous research and analysis: Performing disciplined, bottom-up fundamental research and analysis
is core to our strategy, and we intend to conduct extensive due diligence to evaluate the impact that a transaction may have on the target
business;
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Acquire the target company at an attractive price relative to our view of its intrinsic value: Combining
rigorous bottom-up analysis as well as input from industry and financial experts, the management team intends to develop its view of the
intrinsic value of the potential initial business combination. In doing so, the management team will evaluate future cash flow potential,
relative industry valuation metrics and precedent transactions to inform its view of intrinsic value, with the intention of creating an
initial business combination at an attractive price relative to such view;
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Implement operating and financial structuring opportunities: We believe our management team has the ability
to structure and execute an initial business combination that will provide the combined business with a capital structure that will support
growth in stockholder value and give the combined company the flexibility needed to grow organically and/or through strategic acquisitions
or divestitures. We intend to also develop and implement strategies and initiatives to improve the business’s operating and financial
performance and create a platform for growth; and
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Seek follow-on strategic acquisitions and divestitures to grow further stockholder value: The management
team intends to analyze the strategic direction of the company and evaluate non-core asset sales to create financial and/or operating
flexibility needed for the company to engage in organic or inorganic growth. Specifically, the management team intends to evaluate opportunities
for industry consolidation in the company’s core lines of business as well as opportunities to integrate with other industry participants
vertically or horizontally.
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Following our initial business combination, we
intend to evaluate opportunities to enhance stockholder value, including developing and implementing corporate strategies and initiatives
to provide financial and operating runway such that the company can improve its profitability and long-term value. In doing so, the management
team anticipates evaluating corporate governance, opportunistically accessing capital markets and other opportunities to enhance liquidity,
identifying acquisition and divestiture opportunities, and properly aligning management and board incentives with growing stockholder
value.
We
are not prohibited from pursuing our initial business combination with a company 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 such initial business combination is fair to our company from a financial
point of view.
Sourcing of Potential Initial Business Combination
Targets
While we do not presently anticipate engaging
the services of professional firms or other individuals that specialize in business acquisitions on any formal basis, 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. We will engage a finder only to the extent our management
determines that the use of a finder may bring opportunities to us that may not otherwise be available to us or if finders approach us
on an unsolicited basis with a potential transaction that our management determines is in our best interest to pursue. Payment of a finder’s
fee is customarily tied to completion of a transaction; in which case any such fee will be paid out of the funds held in the trust account.
In no event, however, will our sponsor or any of our existing officers or directors, or any entity with which they are affiliated, be
paid any finder’s fee, consulting fee or other compensation by the company prior to, or for any services they render in order to
effectuate, the completion of our initial business combination (regardless of the type of transaction).
The time required to select and evaluate a target
business and to structure and complete our initial business combination, and the costs associated with this process, are not currently
ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target
business with which an initial business combination is not ultimately completed will result in our incurring losses and will reduce the
funds we can use to complete another initial business combination. We will not pay any finders or consulting fees to members of our management
team, or any of their respective affiliates, for services rendered to or in connection with our initial business combination.
Initial Business Combination
Nasdaq rules require that we must complete
one or more initial business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the
trust account (excluding the fee payable to A.G.P. upon an initial business combination as described in “Underwriting - Conflicts
of Interest” and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in
connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our
initial business combination. If our board of directors is not able to determine independently the fair market value of our initial business
combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders
valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not
be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if
it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the
value of a target’s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved
by a majority of our independent directors.
We anticipate structuring our initial business
combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests
or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction
company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the
prior owners of the target business, the target management team or stockholders or for other reasons, but we will only complete such initial
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 of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50%
or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority
interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial 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, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target.
However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business
combination could own less than a majority of our issued and 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% fair market value
test. If the initial business combination involves more than one target business, the 80% fair market value test will be based on the
aggregate value of all of the target businesses and we will treat the target businesses together as our initial business combination for
purposes of a tender offer or for seeking stockholder approval, as applicable.
To the extent we effect our initial business combination
with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous
risks inherent in such company or business. 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.
In evaluating a prospective target business, we
expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees,
document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information that will be made
available to us.
The time required to select and evaluate a target
business and to structure and complete our initial business combination, and the costs associated with this process, are not currently
ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target
business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the
funds we can use to complete another initial business combination.
Private Placements
On June 9, 2021, our sponsor purchased
4,312,500 of our common shares for an aggregate purchase price of $25,000, which included 1,207,500 representative shares previously
transferred from our sponsor to an affiliate of A.G.P. on June 16, 2021 for $7,000 (up to 157,500 shares of which were subject to
forfeiture to the extent that the underwriters’ over-allotment option is not exercised in full or in part). Such shares are referred
to herein as “founder shares” or “insider shares.” On November 22, 2021, we effected a 2 for 3 reverse stock split of our common
stock, and A.G.P. sold back to our sponsor 55,000 founder shares for $478, such that our sponsor owns 2,125,000 founder shares, and
A.G.P. owns 750,000 founder shares (of which 277,174 founder shares and 97,826 founder shares, respectively, are subject to forfeiture
to the extent that the over-allotment option is not exercised in full or in part so that our initial stockholders will collectively own
20% of our issued and outstanding shares after this offering). None of our initial stockholders has indicated any intention to purchase
public units in this offering.
The founder shares are identical to the public
shares. However, our initial stockholders, officers, and directors have agreed (A) to vote their founder shares in favor of any
proposed initial business combination, (B) not to propose, or vote in favor of, prior to and unrelated to our initial business combination,
an amendment to our certificate of incorporation that would affect the substance or timing of our redemption obligation to redeem all
public shares if we cannot complete our initial business combination within 12 months (or up to 18 months, if extended) of the closing
of this offering, unless we provide our public stockholders an opportunity to redeem their public shares in conjunction with any such
amendment, (C) not to redeem any shares, including founder shares into the right to receive cash from the trust account in connection
with a stockholder vote to approve our proposed initial business combination or sell any shares to us in any tender offer in connection
with our proposed initial business combination, and (D) that the founder shares shall not participate in any liquidating distribution
upon winding up if an initial business combination is not consummated.
On the date of this prospectus, the founder
shares will be placed into an escrow account maintained by American Stock Transfer & Trust Company, LLC acting as escrow agent.
The founder shares will not be transferred, assigned, sold or released from escrow, other than in the case of a permitted transfer described
below, until the earlier of (A) one year after the date of the consummation of our initial business combination or (B) the
date on which we complete a liquidation, merger, stock exchange or other similar transaction after our initial business combination that
results in all of our public stockholders having the right to exchange their shares of common stock for cash, securities or other properties.
Notwithstanding the foregoing, all of the founder shares will be released from the escrow account if (1) the last reported sale
price of our common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations)
for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (2) if
we complete a transaction after our initial business combination that results in all of our stockholders having the right to exchange
their shares for cash, securities or other property. During the escrow period, the holders of these founder shares will not be able to
sell or transfer their securities except (1) to any persons (including their affiliates and stockholders) participating in the private
placement of the private placement units, officers, directors, stockholders, employees, and members of our sponsor and its affiliates,
(2) amongst initial stockholders or their respective affiliates, or to our officers, directors, advisors and employees, (3) if
a holder is an entity, as a distribution to its, partners, stockholders or members upon its liquidation, (4) by bona fide gift to
a member of the holder’s immediate family or to a trust, the beneficiary of which is a holder or a member of a holder’s immediate
family, for estate planning purposes, (5) by virtue of the laws of descent and distribution upon death, (6) pursuant to a qualified
domestic relations order, (7) by certain pledges to secure obligations incurred in connection with purchases of our securities,
(8) by private sales at prices no greater than the price at which the shares were originally purchased or (9) for the cancellation
of up to 375,000 shares of common stock subject to forfeiture to the extent that the underwriters’ over-allotment is not exercised
in full or in part or in connection with the consummation of our initial business combination, in each case (except for clause 9 or with
our prior consent) where the transferee agrees to the terms of the escrow agreement and the letter agreement.
Additionally, our sponsor has agreed to purchase
an aggregate of 361,000 units (or up to 376,000 units depending on the extent to which the underwriters’ over-allotment option
is exercised), at $10.00 per unit for a total purchase price of $3,610,000 (or
up to $3,760,000 depending on the extent to which the underwriters’ over-allotment option is exercised), on a private placement
basis simultaneously with the consummation of this offering. The private placement units are identical to the public units, subject to
certain limited exceptions as described in this prospectus. There will be no underwriting fees or commissions with respect to the private
placement units.
A portion of the proceeds from the private
placement of the private placement units will be added to the proceeds of this offering and placed in a trust account in the United States
maintained by American Stock Transfer & Trust Company, LLC, as trustee, in an amount such that, at the time of the closing
of this offering, $101,000,000 or $116,150,000 if the over-allotment option is exercised in full ($10.10 per unit) will be held in the
trust account. The remainder of such proceeds shall be held by us outside of the trust account for working capital purposes. If we do
not complete our initial business combination within 12 months (or up to 18 months, if extended), our initial stockholders have waived
any and all rights and claims to any proceeds and interest thereon in respect to the private placement units, and the portion of the
private placement proceeds that is placed into the trust account will be included in the liquidating distribution to the holders of our
public shares.
The private placement units are identical to the
units sold to the public in this offering.
If public units or public shares are purchased
by any of our directors, officers, or initial stockholders, they will be entitled to funds from the trust account upon our liquidation
to the same extent as any public stockholder, but will not have redemption rights related thereto.
Corporate Information
Our executive offices are located at 42 Broadway,
12th Floor, New York, New York 10004, and our telephone number is 310-740-0710.
We are an “emerging growth company,”
as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our
Business Startups Act of 2012, or 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 stockholder 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 until
the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in
which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer,
which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior December 31,
and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.
References herein to “emerging growth company” shall have the meaning associated with it in the JOBS Act.
The Offering
In making your decision on whether to invest in
our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks
we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under
the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You
should carefully consider these and the other risks set forth in the section below entitled “Risk Factors” beginning on page 29
of this prospectus.
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Securities
offered
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10,000,000 units (or 11,500,000 units
if the underwriters’ over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of:
·
one share of common stock; and
·
one warrant to purchase three-quarters of a share of common stock
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Listing of our securities
and proposed symbols
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We anticipate the units and the shares of common stock and the warrants, once they begin separate trading, will be listed on the Nasdaq stock exchange under the symbols “WAVSU,” “WAVS,” and “WAVSW,” respectively.
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Trading commencement
and separation of
common stock and
warrants
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Each of the shares of common stock and warrants may trade separately on the 90th day after the date of this prospectus unless A.G.P. determines that an earlier date is acceptable (based upon, among other things, its assessment of the relative strengths of the securities markets and small capitalization companies in general, and the trading pattern of, and demand for, our securities in particular). In no event will A.G.P. allow separate trading of the shares of common stock and warrants until we file an audited balance sheet reflecting our receipt of the gross proceeds of this offering.
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Once the shares
of common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their
units into the component pieces. Holders will need to have their brokers contact our transfer agent in order to separate
the units into separately trading shares of common stock and warrants.
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We will file a Current
Report on Form 8-K with the SEC, including an audited balance sheet, promptly upon the consummation of this offering, which
is anticipated to take place two business days from the date the units commence trading. The audited balance sheet will reflect our
receipt of the proceeds from the exercise of the over-allotment option if the over-allotment option is exercised on the date of this
prospectus. If the over-allotment option is exercised after the date of this prospectus, we will file an amendment to the Form 8-K
or a new Form 8-K to provide updated financial information to reflect the exercise of the over-allotment option. We will also
include in the Form 8-K, or amendment thereto, or in a subsequent Form 8-K, information indicating if A.G.P. has allowed
separate trading of the shares of common stock and warrants prior to the 90th day after the date of this prospectus.
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Units:
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Number
outstanding before
this offering and the
private placement
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0 units
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Number
outstanding after
this offering and the
private placement
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10,361,000
units (or 11,876,000 if the underwriters’ over-allotment option is exercised in full), which
includes the private placement units.
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Shares
of common stock:
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Number
issued and
outstanding before this
offering and the private
placement
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2,875,000
founder shares (including 750,000 representative shares)
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Number
to be issued and
outstanding after this
offering and the private
placement
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12,861,000
common shares, including 10,000,000 shares underlying the public units, 2,500,000 founder
shares (including 652,174 representative shares) and 361,000 shares underlying the private
placement units. These numbers assume the over-allotment option is not exercised.
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Redeemable Warrants:
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Number issued and
outstanding before this
offering and the private
placement
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0 warrants
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Number
to be issued and
outstanding warrants after
this offering and the private
placement
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10,361,000 warrants (or 11,876,000
if the over-allotment option is exercised in full), which includes warrants that make part of the
private placement units.
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Exercisability
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Each redeemable public warrant
entitles the holder thereof to purchase three-quarters (3/4) of a share of common stock. Pursuant
to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares.
This means that only an even number of public warrants may be exercised at any given time by a warrant
holder. No fractional warrants will be issued upon separation of the units and only whole warrants
will trade and are exercisable.
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Exercise price
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$11.50 per whole share, subject to adjustment as described herein. In addition, if (x) we issue additional shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per public shares (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance), or the Newly Issued Price, (y) 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 (z) the volume weighted average trading price of our common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination, or the Market Value, is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under “Redemption of warrants” will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price.
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Exercise period
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Beginning on the later of: (i) one year after the date that the registration statement for this offering, or this Registration Statement, is declared effective by the SEC; and (ii) the consummation by us of our initial business combination, and terminating on the five-year anniversary of the completion of our initial business combination; provided, in each case, that we have an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement).
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We are not registering the shares of common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 20 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration statement covering the issuance of the shares of common stock issuable upon exercise of the warrants, to cause such registration statement to become effective within 60 business days following our initial business combination and to maintain a current prospectus relating to those shares of common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the issuance of the shares of common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. If that exemption, or another exemption is not available, holders will not be able to exercise their warrants on a cashless basis. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account.
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Redemption
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We may redeem the outstanding warrants in whole
and not in part, at a price of $0.01 per warrant:
● at
any time while such warrants are exercisable,
● upon
a minimum of 30 days’ prior written notice of redemption,
● if,
and only if, the last sales price of our common stock equals or exceeds $18.00 per share for any 20 trading days within a 30 trading day
period ending three business days before we send the notice of redemption, and
● if,
and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at
the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of
redemption.
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If the foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise their warrant prior to the scheduled redemption date. However, the price of our common stock may fall below the $18.00 trigger price, as well as the $11.50 warrant exercise price after the redemption notice is issued.
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The redemption criteria for our warrants have been established at a price that is intended to provide warrant holders a reasonable premium to the initial exercise price and provide a sufficient differential between the then-prevailing share price and the warrant exercise price so that if the share price declines as a result of our redemption call, the redemption will not cause the share price to drop below the exercise price of the warrants.
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If we call the warrants
for redemption as described above, our management will have the option to require all holders that wish to exercise such warrants
to do so on a “cashless basis.” In such event, each holder would pay the exercise price by surrendering the whole warrants
for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares
of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “fair
market value” (defined below) by (y) the fair market value. The “fair market value” shall mean the average
reported last sale price of the shares of common stock for the 10 trading days ending on the third trading day prior to the date
on which the notice of redemption is sent to the holders of warrants. Whether we will exercise our option to require all holders
to exercise their warrants on a “cashless basis” will depend on a variety of factors including the price of our shares
of common stock at the time the warrants are called for redemption, our cash needs at such time and concerns regarding dilutive share
issuances.
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The holders of representative shares will not participate in any distribution from our trust account with respect to such shares.
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Founder Shares
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On June 9,
2021, our sponsor purchased 4,312,500 shares for an aggregate purchase price of $25,000, which included
1,207,500 representative shares transferred from our sponsor to an affiliate of A.G.P. on June 16,
2021 for $7,000 (up to 157,500 of which were subject to forfeiture to the extent that the underwriters’
over-allotment option is not exercised in full or in part). On November 22, 2021, we effected a
2 for 3 reverse stock split of our common stock, and A.G.P. sold back to our sponsor 55,000 founder shares for $478,
such that our sponsor owns 2,125,000 founder shares, and A.G.P. owns 750,000 founder shares (of which
277,174 founder shares and 97,826 founder shares that are subject to forfeiture to the extent that
the over-allotment option is not exercised in full or in part so that our initial stockholders will
collectively own 20% of our issued and outstanding shares after this offering).
Prior to the initial investment in us of $25,000
by our sponsor, we had no assets, tangible or intangible. The per share purchase price of the founder shares was determined by dividing
the amount of cash contributed to us by the aggregate number of founder shares issued. The number of founder shares issued was determined
based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering (excluding the shares
of common stock underlying the private placement warrants). As such, our initial stockholders will collectively own approximately 20%
of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). Neither our sponsor
nor any of our officers or directors have expressed an intention to purchase any public units in this offering.
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The founder shares are identical to the shares
of common stock underlying the public units being sold in this offering, except that:
· the
founder shares are subject to certain transfer restrictions, as described in more detail below;
· our
initial stockholders, directors, and officers have entered into letter agreements, or, the letter agreements, with us, pursuant to
which they have agreed to (i) waive their redemption rights with respect to any founder shares and public shares held by them
in connection with the completion of our initial business combination; (ii) waive their redemption rights with respect to any
founder shares and public shares held by them in connection with a stockholder vote to approve an amendment to our amended and restated
certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with
our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we
do not complete our initial business combination within 12 months (or up to 18 months, if extended) from the closing of this offering;
or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity;
and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares held by
them if we fail to complete our initial business combination within 12 months (or up to 18 months, if extended) from the closing
of this offering, although they will be entitled to liquidating distributions from the trust account with respect to any public shares
they hold if we fail to complete our initial business combination within the prescribed time frame;
· pursuant
to the letter agreements, our initial stockholders have agreed to vote any founder shares held by them and any public shares they
may acquire during or after this offering (including in open market and privately negotiated transactions) in favor of our initial
business combination. If we submit our initial business combination to our public stockholders for a vote, we will complete our initial
business combination only if a majority of the then-outstanding shares of common stock present and entitled to vote at the meeting
to approve our initial business combination are voted in favor of our initial business combination. As a result, in addition to our
initial stockholders’ founder shares and private placement units, we would need only 3,569,501 or 35.7%, of the 10,000,000
public shares sold in this offering to be voted in favor of our initial business combination (assuming all outstanding shares are
voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised); and
· the
founder shares, including the representative shares, are entitled to registration rights.
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Private Placement Units
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Our sponsor has agreed to purchase
an aggregate of 361,000 units (or up to 376,000 units depending on the extent to which the underwriters’
over-allotment option is exercised), at $10.00 per unit for a total purchase price of $3,610,000
(or up to $3,760,000 depending on the extent to which the underwriters’ over-allotment option
is exercised), on a private placement basis simultaneously with the consummation of this offering
and regardless of whether the underwriters’ over-allotment option is exercised. Each private
placement unit consists of one share of common stock and one warrant to purchase three-quarters of
a share of common stock. The private placement units are identical to the units being sold in this
offering; provided, that, if we do not complete our initial business combination within 12 months
(or up to 18 months, if extended) from the closing of this offering, the private placement units
will expire worthless.
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A portion of the proceeds from the private
placement of the private placement units will be added to the proceeds of this offering and placed in a trust account in the United
States maintained by American Stock Transfer & Trust Company, LLC, as trustee, in an amount such that, at the time
of the closing of this offering, $101,000,000 (or $116,150,000 if the over-allotment option is exercised in full) will be held in
the trust account ($10.10 per unit). The remainder of such proceeds shall be held by us outside of the trust account for working
capital purposes.
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Representative Shares
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As part of the underwriting
compensation payable to the underwriters in connection with this offering, 750,000 representative shares were transferred from our
sponsor to an affiliate of A.G.P. for $6,522, which make up part of the founder shares, of which 97,826 are subject to forfeiture
if the underwriters do not exercise the over-allotment. The representative has agreed not to transfer, assign, or sell any such shares
without our prior consent until the completion of our initial business combination. In addition, A.G.P. has agreed (i) to waive
its redemption rights (or right to participate in any tender offer) with respect to such shares in connection with the completion
of our initial business combination and (ii) to waive its rights to liquidating distributions from the trust account with respect
to such shares if we fail to complete our initial business combination within 12 months (or up to 18 months, if extended) from the
closing of this offering. The representative shares are deemed to be underwriters’ compensation by FINRA pursuant
to FINRA Rule 5110.
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Offering proceeds to be
held in trust
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$101,000,000 (or $116,150,000
if the over-allotment option is exercised in full), consisting of the net proceeds of this offering
and a portion of the net proceeds of the private placement, will be placed in a United States based
trust account, maintained by American Stock Transfer & Trust Company, LLC, acting as trustee
pursuant to an agreement to be signed on the date of this prospectus.
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The proceeds of
this offering include $4,500,000 (or $5,175,000 if the underwriters’ over-allotment
option is exercised in full) in the aggregate, to be payable to A.G.P. upon consummation
of the initial business combination, as an initial business combination agreement fee as
described under the section “Underwriting - Conflicts of Interest”, representing
4.5% of the proceeds from this offering. Such amount is to be placed in a trust
account located in the United States as described herein.
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Except as set forth below, the proceeds in the trust account will not be released until the earlier of: (1) the completion of our initial business combination within the required time period and (2) our redemption of 100% of the outstanding public shares if we have not completed an initial business combination in the required time period. Therefore, unless and until our initial business combination is consummated, the proceeds held in the trust account will not be available for our use for any expenses related to this offering or expenses that we may incur related to the investigation and selection of a target business and the negotiation of an agreement to acquire a target business.
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Notwithstanding the foregoing, there can be released to us, from time to time, any interest earned on the funds in the trust account that we may need to pay our tax obligations. With this exception, expenses incurred by us may be paid prior to an initial business combination only from the approximately $1,425,000 of net proceeds of the sale of the private placement units in the private placement that are not held in the trust account.
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Limited payments to
insiders
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Prior to the consummation of our initial business
combination, there will be no fees, reimbursements or other cash payments paid to our initial stockholders, officers, directors, or their
affiliates 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) other than:
● repayment
of loans of up to $300,000 advanced to us by our sponsor to cover offering-related and organizational expenses, evidenced by promissory
notes;
● payment
to A.G.P. of $500,000 and transfer by our sponsor to an affiliate of A.G.P. of the representative shares for $6,522, as an underwriting
fee;
● simultaneously
with the initial business combination, payment to A.G.P. of a 4.5% initial business combination marketing fee as described under the section
“Underwriting - Conflicts of Interest”;
● repayment
of loans that may be made by our insiders, officers, directors, or any of its or their affiliates to finance transaction costs in connection
with our initial business combination, the terms of which have not been determined;
● reimbursement
of out-of-pocket expenses incurred by them in connection with certain activities on our behalf, such as identifying and investigating
possible business targets and initial business combinations; and
● repayment upon consummation of our initial business combination of any loans that may be made by our initial stockholders or their affiliates or our officers and directors to finance transaction costs in connection with an intended initial business combination
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There is no limit on the amount of out-of-pocket expenses reimbursable by us; provided, however, that to the extent such expenses exceed the available proceeds not deposited in the trust account and the interest income earned on the amounts held in the trust account available to us, such expenses would not be reimbursed by us unless we consummate our initial business combination (other than up to $100,000 of such accrued interest to pay dissolution costs and expenses). Our audit committee will review and approve all reimbursements and payments made to any initial stockholder or member of our management team, or their respective affiliates, and any reimbursements and payments made to members of our audit committee will be reviewed and approved by our board of directors, with any interested director abstaining from such review and approval.
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Stockholder approval of,
or tender offer in
connection with, initial
initial business combination
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In connection with any proposed initial business combination, we will either (1) seek stockholder approval of such initial business combination at a meeting called for such purpose at which public stockholders may seek to convert their public shares, regardless of whether they vote for or against the proposed initial business combination, 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 stockholders with the opportunity to sell their public shares to us by means of a tender offer (and thereby avoid the need for a stockholder 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. Notwithstanding the foregoing, our initial stockholders, directors, and officers have agreed, pursuant to the letter agreements, not to convert any public shares held by them into their pro rata share of the aggregate amount then on deposit in the trust account. If we determine to engage in a tender offer, such tender offer will be structured so that each public stockholder may tender any or all of their public shares rather than some pro rata portion of their shares. If enough stockholders tender their shares so that we are unable to satisfy any applicable closing condition set forth in the definitive agreement related to our initial business combination, or we are unable to maintain net tangible assets of at least $5,000,001, we will not consummate such initial business combination. The decision as to whether we will seek stockholder approval of a proposed initial business combination or will allow stockholders to sell their shares to us in a tender offer will be made by us based on a variety of factors such as the timing of the transaction or whether the terms of the transaction would otherwise require us to seek stockholder approval. If we provide stockholders with the opportunity to sell their shares to us by means of a tender offer, we will file tender offer documents with the SEC that will contain substantially the same financial and other information about our initial business combination as is required under the SEC’s proxy rules. If we seek stockholder approval of our initial business combination, we will consummate the initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination.
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We have determined not to consummate any initial business combination unless we have net tangible assets of at least $5,000,001 upon such consummation in order to avoid being subject to Rule 419 promulgated under the Securities Act. However, if we seek to consummate our 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, our net tangible asset threshold may limit our ability to consummate such initial business combination (as we may be required to have a lesser number of shares redeemed) and may force us to seek third party financing that 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.
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Pursuant to
the letter agreements, our initial stockholders, directors, and officers have agreed (A) to vote their founder shares and any
public shares in favor of any proposed initial business combination; (B) to not propose, or vote in favor of, prior to and
unrelated to our initial business combination, an amendment to our certificate of incorporation that would affect the substance or
timing of our redemption obligation to redeem all public shares if we cannot complete our initial business combination within 12
months (or up to 18 months, if extended) unless we provide public stockholder an opportunity to redeem their public shares in
conjunction with any such amendment; (C) to not convert any shares (including the founder shares and public shares they acquire
in this offering or otherwise) into the right to receive cash from the trust account in connection with a stockholder vote to
approve our proposed initial business combination or sell any shares to us in a tender offer in connection with our proposed initial
business combination; and (D) that the founder shares shall not participate in any liquidating distribution upon winding up if
an initial business combination is not consummated. None of our initial stockholders or their affiliates has indicated any intention
to purchase public units in this offering or any units or shares of common stock in the open market or in private transactions.
However, if a significant number of stockholders vote, or indicate an intention to vote, against a proposed initial business
combination, our initial stockholders, officers, directors, or their affiliates could make such purchases in the open market or in
private transactions in order to influence the vote. Our sponsor could purchase sufficient shares so that our initial business
combination may be approved without the majority vote of public shares held by non-affiliates. Notwithstanding the foregoing, our
officers, directors, initial stockholders and their affiliates will not make purchases of shares of common stock 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 stock or purchasing shares when the buyer is in possession of material non-public information
about us.
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Conversion rights
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In connection with any stockholder meeting called to approve a proposed initial business combination, each public stockholder will have the right, regardless of whether he, she or it is voting for or against such proposed initial business combination, to demand that we convert their public shares into a pro rata share of the trust account upon consummation of the initial business combination.
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We may require public stockholders wishing to exercise conversion rights, whether they are a record holder or hold their shares in “street name,” to either tender the certificates they are seeking to convert to our transfer agent or to deliver the shares they are seeking to convert to the transfer agent electronically using Depository Trust Company’s DWAC (Deposit/Withdrawal At Custodian) System, at the holder’s option, at any time at or prior to the vote on the initial business combination. There is a nominal cost associated with this tendering process and the act of certificating the shares or delivering them through the DWAC System. The transfer agent will typically charge the tendering broker $45 and it would be up to the broker whether or not to pass this cost on to the converting holder. However, this fee would be incurred regardless of whether or not we require holders to deliver their shares prior to the vote on the initial business combination in order to exercise conversion rights. This is because a holder would need to deliver shares to exercise conversion rights regardless of the timing of when such delivery must be effectuated. However, in the event we require stockholders to deliver their shares prior to the vote on the proposed initial business combination and the proposed initial business combination is not consummated, this may result in an increased cost to stockholders. The conversion rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares.
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Under Delaware law, we may be required to give a minimum of only ten days’ notice for each general meeting. As a result, if we require public stockholders who wish to convert their shares of common stock into the right to receive a pro rata portion of the funds in the trust account to comply with the foregoing delivery requirements, holders may not have sufficient time to receive the notice and deliver their shares for conversion. Accordingly, investors may not be able to exercise their conversion rights and may be forced to retain our securities when they otherwise would not want to.
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If we require public stockholders who wish to convert their shares of common stock to comply with specific delivery requirements for conversion described above and such proposed initial business combination is not consummated, we will promptly return such certificates to the tendering public stockholders.
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Liquidation
if no initial business combination
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If we are
unable to complete our initial business combination within 12 months (or up to 18 months, if extended) from the closing of this offering,
we will (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not
more than five business days thereafter, redeem 100% of the outstanding public shares (including any public units in this offering
or any public units or shares that our initial stockholders or their affiliates purchased in this offering or later acquired in the
open market or in private transactions), which redemption will completely extinguish public stockholders’ rights as stockholders
(including the right to receive further liquidation distributions, if any), subject to applicable law; and (iii) as promptly
as reasonably practicable following such redemption, subject to the approval of our remaining holders of common stock and our board
of directors, proceed to commence a voluntary liquidation and thereby our formal dissolution, subject (in the case of (ii) and
(iii) above) to our obligations to provide for claims of creditors and the requirements of applicable law.
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In connection with our redemption of 100% of our outstanding public shares for a portion of the funds held in the trust account, each holder will receive a full pro rata portion of the amount then in the trust account, plus any pro rata interest earned on the funds held in the trust account and not necessary to pay our taxes payable on such funds. Holders of warrants will receive no proceeds in connection with the liquidation with respect to such warrants, which will expire worthless.
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We may not have funds sufficient to pay or provide for all creditors’ claims. Although we will seek to have all third parties (including any vendors or other entities we engage after this offering) and any prospective target businesses enter into valid and enforceable agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account, there is no guarantee that they will execute such agreements. There is also no guarantee that the third parties would not challenge the enforceability of these waivers and bring claims against the trust account for monies owed them.
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The holders of the founder shares and private placement units will not participate in any redemption distribution with respect to their founder shares and private placement units, but may have any public shares redeemed upon liquidation.
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If we are unable to
conclude our initial business combination and we expend all of the net proceeds of this offering not deposited in the trust account,
without taking into account any interest earned on the trust account, we expect that the initial per-share redemption price will
be approximately $10.10. The proceeds deposited in the trust account, however, could become subject to claims of our creditors that
are in preference to the claims of our stockholders. Furthermore, our underwriters may seek recourse against the proceeds in the
trust account relating to any future claims they may have against us. In addition, if we are forced to file a bankruptcy case or
an involuntary bankruptcy case is filed against us that is not dismissed, the proceeds held in the trust account could be subject
to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority
over the claims of our stockholders. Therefore, the actual per-share redemption price may be less than approximately $10.10. We will
pay the costs of any subsequent liquidation from our remaining assets outside of the trust account. We expect that
all costs and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be funded
from amounts remaining out of the approximately $1,425,000 of proceeds held outside the trust account, although we cannot assure
you that there will be sufficient funds for such purpose. We will depend on sufficient interest being earned on the proceeds held
in the trust account to pay any tax obligations we may owe. However, if those funds are not sufficient to cover the costs and expenses
associated with implementing our plan of dissolution, to the extent that there is any interest accrued in the trust account not required
to pay taxes on interest income earned on the trust account balance, we may request the trustee to release to us an additional amount
of up to $100,000 of such accrued interest to pay those costs and expenses.
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Conflict of Interest
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A.G.P. has a “conflict of interest” within the meaning
of FINRA Rule 5121(f)(5)(B) in this offering because it and its affiliates collectively own more than 10% of our shares. Due
to this conflict of interest, The Benchmark Company, LLC is acting as a “qualified independent underwriter” in accordance
with FINRA Rule 5121, which requires, among other things, that a qualified independent underwriter participate in the preparation
of, and exercise the usual standards of “due diligence” with respect to, this prospectus and the registration statement of
which it forms a part. The Benchmark Company, LLC will receive $100,000 (such amount to be deducted from the underwriters’ commissions)
for acting as a qualified independent underwriter. We have agreed to indemnify The Benchmark Company, LLC
against certain liabilities incurred in connection with acting as qualified independent underwriter, including liabilities under the
Securities Act. In addition, no underwriter with a conflict of interest will confirm sales to any account over which it exercises discretionary
authority without the specific prior written approval of the account holder. See “Underwriting — Conflicts of Interest”
for further information.
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RISKS
We are a newly formed company that has conducted
no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate
no operating revenues. In making your decision on whether to invest in our securities, you should take into account not only the background
of our management team, but also the special risks we face as a blank check company, as well as the fact that this offering is not being
conducted in compliance with Rule 419 promulgated under the Securities Act, and, therefore, you will not be entitled to protections
normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check
offerings differ from this offering, please see “Proposed Business — Comparison to offerings of blank check companies subject
to Rule 419.” You should carefully consider these and the other risks set forth in the section entitled “Risk Factors”
beginning on page 29 of this prospectus.
Summary of Risk Factors
An investment in our securities involves a high
degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this
prospectus, before making a decision 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. Such risks include, but are not limited to:
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·
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We are a newly-formed blank check company in the early stage, with no operating history and no revenues,
and you have no basis on which to evaluate our ability to achieve our business objective.
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·
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Our public stockholders may not be afforded an opportunity to vote on our proposed initial business
combination, which means we may consummate our initial business combination even though a majority of our public stockholders do not support
such a combination.
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·
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If we seek stockholder approval of our initial business combination, our initial stockholders, officers,
and directors have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote.
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·
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The
requirement that we complete our initial business combination within 12 months (or up to
18 months, if extended) from the closing of this offering may give potential target businesses
leverage over us in negotiating our initial business combination.
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·
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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 stockholders may only receive
$10.10 per share, or less than such amount in certain circumstances, and our warrants will
expire worthless.
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·
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Our search for an initial business combination, and any target business with which we ultimately
consummate an initial business combination, may be materially adversely affected by the recent coronavirus (COVID-19) outbreak and the
status of debt and equity markets.
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·
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If a stockholder fails to receive notice of our offer to redeem our public shares in connection
with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
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·
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You will not have any rights or interests in funds from the trust account, except under certain
limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares, potentially at a loss.
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·
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You will not be entitled to protections normally afforded to investors of many other blank check
companies.
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·
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If we do not have sufficient working capital to allow us
to operate for at least the next 12 months (or up to 18 months if extended), we may be unable to complete our initial business combination,
in which case our public stockholders may only receive $10.10 per share, or less than such amount in certain circumstances, and our warrants
will expire worthless.
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·
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If
we are unable to consummate our initial business combination, our public stockholders may
be forced to wait up to 12 months or longer from the date of our initial public offering
before redemption from our trust account.
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·
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We are not required to obtain an opinion from an independent investment banking firm, and consequently,
an independent source may not confirm that the price we are paying for the business is fair to our stockholders from a financial point
of view.
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·
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Our ability to effect successfully our initial business combination, and to be successful thereafter,
will be largely dependent upon the efforts of our officers, directors and key personnel, some of whom may join us following our initial
business combination.
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·
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Certain of our officers and directors are now, or in the future may be, affiliated with entities
engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in allocating
their time and determining to which entity a particular business opportunity should be presented.
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·
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We may engage in our initial business combination with one or more target businesses that have relationships
with entities that may be affiliated with our sponsor, officers, directors, representative, or existing holders that may raise potential
conflicts of interest.
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·
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Because
our officers and directors will be eligible to share in a portion of any appreciation in
founder shares purchased at approximately $0.0087 per share, a conflict of interest may arise
in determining whether a particular initial business combination target is appropriate for
our initial business combination.
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·
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A.G.P. may have a conflict of interest in connection with our initial business combination.
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·
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Because our sponsor will lose its entire initial investment in us if our initial business combination
is not consummated, and our officers and directors have significant financial interests in us, a conflict of interest may arise in determining
whether a particular acquisition target is appropriate for our initial business combination.
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·
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Because
our sponsor paid only approximately $0.0087 per share for the founder shares, certain of
our officers and directors could potentially make a substantial profit even if we acquire
a target business that subsequently declines in value.
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·
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The nominal purchase price paid by our sponsor for the founder shares may result in significant
dilution to the implied value of your public shares upon the consummation of our initial business combination.
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·
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We may amend the terms of the warrants in a way that may be adverse to holders with the approval
by the holders of a majority of the then-outstanding warrants.
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Our
independent registered public accounting firm’s report contains an explanatory paragraph
that expresses substantial doubt about our ability to continue as a “going concern.”
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·
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The other risks and uncertainties discussed in “Risk Factors” and elsewhere in this
prospectus.
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SUMMARY FINANCIAL DATA
The following table summarizes the relevant financial
data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant
operations to date, so only balance sheet data are presented.
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September
30,
2021
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Actual
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As Adjusted
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Balance Sheet Data:
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Working capital (deficiency)(1)
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$
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(275,163
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)
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$
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1,446,962
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Total assets(2)
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308,562
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102,446,962
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Total liabilities
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286,600
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-
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Value of common stock subject to possible redemption
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-
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101,000,000
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Stockholders’ equity(3)
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21,962
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1,446,962
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(1)
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The “as adjusted”
calculation includes $1,425,000 in cash held outside the trust account, plus $21,962 of actual
stockholders’ equity, as of September 30, 2021.
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(2)
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The “as adjusted”
calculation includes $101,000,000 cash held in trust from the proceeds of this offering and
the sale of the private placement units, plus $1,425,000 in cash held outside the
trust account, plus $21,962 of actual stockholders’ equity as of September 30, 2021.
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(3)
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Excludes 10,000,000
shares of common stock purchased in the public market which are subject to redemption in
connection with our initial business combination. The “as adjusted” calculation
equals the “as adjusted” total assets, less the “as adjusted” total
liabilities, less the value of common stock that may be redeemed in connection with
our initial business combination (approximately $10.10 per share).
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If no initial business combination is completed
within the period to consummate our initial business combination, the proceeds then on deposit in the trust account including interest
earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes as well as expenses
relating to the administration of the trust account (less up to $100,000 of interest to pay dissolution costs and expenses), will be
used to fund the redemption of our public shares. Our initial stockholders, directors, and officers have entered into the letter agreements,
pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder
shares held by them if we do not complete our initial business combination within such 12-month time period (or up to 18 months, if extended).
RISK FACTORS
An investment in our securities involves a
high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in
this prospectus, before making a decision 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 Relating to our Search for, and Consummation
of, or Inability to Consummate, a Business Combination
We are a newly-formed blank check company
in the early stage, with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business
objective.
We are a recently formed blank check company with
no operating results, and we will not commence operations until obtaining funding through this offering and consummating our initial business
combination. Because we lack an operating history, you have no basis upon which to evaluate our ability to achieve our business objective
of completing our initial business combination with one or more target businesses. We have no plans, arrangements or understandings with
any prospective target business concerning our initial business combination and may be unable to complete our initial business combination.
If we fail to complete our initial business combination, we will never generate any operating revenues.
The
requirement 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 (excluding the fee payable to A.G.P. upon an initial business combination
as described in “Underwriting - Conflicts of Interest” and taxes payable on the interest earned on the trust account) at the
time of the execution of a definitive agreement for our initial business combination may limit the type and number of companies with which
we may complete such an initial business combination.
Pursuant to the Nasdaq stock exchange listing
rules, 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 (excluding the fee payable to A.G.P. upon an initial business combination as described in “Underwriting
- Conflicts of Interest” and taxes payable on the interest earned on the trust account)at the time of the execution of a definitive
agreement for our initial business combination. This restriction may limit the type and number of companies with which we may complete
an initial business combination. If we are unable to locate a target business or businesses that satisfy this fair market value test,
we may be forced to liquidate and you will only be entitled to receive your pro rata portion of the funds in the trust account, which
may be less than $10.10 per share.
Our public stockholders may not be afforded
an opportunity to vote on our proposed initial business combination, which means we may consummate our initial business combination even
though a majority of our public stockholders do not support such a combination.
We may choose not to hold a stockholder vote to
approve our initial business combination unless our initial business combination would require stockholder approval under applicable law
or stock exchange listing requirements or if we decide to hold a stockholder vote for business or other legal reasons. Except as required
by law, the decision as to whether we will seek stockholder approval of a proposed initial business combination or will allow stockholders
to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors,
such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval.
Even if we seek stockholder approval, the holders of the founder shares will participate in the vote on such approval. Accordingly, we
may complete our initial business combination even if holders of a majority of our public shares do not approve of our initial business
combination we complete. Please see the section of this prospectus entitled “Proposed Business — Stockholders May Not
Have the Ability to Approve Our Initial business combination” for additional information.
If we seek stockholder approval of our initial
business combination, our initial stockholders, officers, and directors have agreed to vote in favor of such initial business combination,
regardless of how our public stockholders vote.
Pursuant to the letter agreements, our initial
stockholders, directors, and officers have agreed to vote their founder shares and any public shares purchased during or after this offering
(including in open market and privately negotiated transactions), in favor of our initial business combination. As a result, in addition
to our initial stockholders’ founder shares and the private placement units, we would need only 3,569,501 or 35.7%, of the 10,000,000
public shares sold in this offering to be voted in favor of our initial business combination (assuming all outstanding shares are voted)
in order to have our initial business combination approved (assuming the over-allotment option is not exercised). Our initial stockholders,
directors, and officers, and their permitted transferees will own shares representing approximately 20% of our outstanding shares of
common stock immediately following the completion of this offering. Accordingly, if we seek stockholder approval of our initial business
combination, the agreement by our initial stockholders, directors, and officers to vote in favor of our initial business combination
will increase the likelihood that we will receive the requisite stockholder approval for such initial business combination. In addition,
we have agreed not to enter into a definitive agreement regarding our initial business combination without the prior consent of our sponsor.
Your only opportunity to affect the investment
decision regarding a potential initial business combination may be limited to the exercise of your right to redeem your shares from us
for cash.
At the time of your investment in us, you will
not be provided with an opportunity to evaluate the specific merits or risks of one or more target businesses. Because our board of directors
may consummate our initial business combination without seeking stockholder approval, public stockholders may not have the right or opportunity
to vote on the initial business combination. Accordingly, your only opportunity to affect the investment decision regarding a potential
initial business combination may be limited to exercising your redemption rights within the period of time (which will be at least 20
business days) set forth in our tender offer documents mailed to our public stockholders in which we describe our initial business combination.
The ability of our public stockholders to
redeem their shares for cash may make our financial condition unattractive to potential initial business combination targets, which may
make it difficult for us to enter into our initial business combination with a target.
We
may seek to enter into our initial business combination agreement with a prospective target that requires as a closing condition that
we have a minimum net worth or a certain amount of cash. If too many public stockholders exercise their redemption rights, we would not
be able to meet such closing condition and, as a result, would not be able to proceed with our initial business combination. If too many
public stockholders exercise their redemption rights, we would not be able to meet such closing condition and, as a result, would not
be able to proceed with our initial business combination. Furthermore, we may only redeem our public shares so long as our net tangible
assets are at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment
of underwriters’ fees and commissions (so that we are not subject to the SEC’s “penny stock” rules) or any greater
net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. Consequently,
if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or such greater
amount necessary to satisfy a closing condition as described above, we would not proceed with such redemption and the related initial
business combination and may instead search for an alternate initial business combination. Prospective targets will be aware of these
risks and, thus, may be reluctant to enter into our initial business combination with us. The ability of a large number of our stockholders
to exercise redemption rights may not allow us to consummate the most desirable initial business combination or optimize our capital structure.
The ability of a large number of our stockholders
to exercise redemption rights may not allow us to consummate the most desirable initial business combination or optimize our capital structure.
In connection with the successful consummation
of our initial business combination, we may redeem up to that number of shares of common stock that would permit us to maintain net tangible
assets of $5,000,001. If our initial business combination requires us to use substantially all of our cash to pay the purchase price,
the redemption threshold may be further limited. Alternatively, we may need to arrange third party financing to help fund our initial
business combination in case a larger percentage of stockholders exercise their redemption rights than we expect. If the acquisition involves
the issuance of our shares as consideration, we may be required to issue a higher percentage of our shares to the target or its stockholders
to make up for the failure to satisfy a minimum cash requirement. Raising additional funds to cover any shortfall may involve dilutive
equity financing or incurring indebtedness at higher than desirable levels. This may limit our ability to effectuate the most attractive
initial business combination available to us.
The requirement that we maintain a minimum
net worth or retain a certain amount of cash could increase the probability that we cannot consummate our initial business combination
and that you would have to wait for liquidation in order to redeem your shares.
If, pursuant to the terms of our proposed initial
business combination, we are required to maintain a minimum net worth or retain a certain amount of cash in trust in order to consummate
the initial business combination and regardless of whether we proceed with redemptions under the tender offer or proxy rules, the probability
that we cannot consummate our initial business combination is increased. If we do not consummate our initial business combination, you
would not receive your pro rata portion of the trust account until we liquidate. If you are in need of immediate liquidity, you could
attempt to sell your shares in the open market; however, at such time our shares may trade at a discount to the pro rata amount in our
trust account. In either situation, you may suffer a material loss on your investment or lose the benefit of funds expected in connection
with our redemption until we liquidate or you are able to sell your shares in the open market.
The requirement that we complete our
initial business combination within 12 months (or up to 18 months, if extended) from the closing of this offering may give potential
target businesses leverage over us in negotiating our initial business combination.
Any potential target business with which we
enter into negotiations concerning our initial business combination will be aware that we must consummate our initial business combination
within 12 months (or up to 18 months, if extended) from the closing of this offering. Consequently, such target businesses may obtain
leverage over us in negotiating our initial business combination, knowing that if we do not complete our initial business combination
with that particular target business, we may be unable to complete our initial business combination with any target business. This risk
will increase as we get closer to the timeframe described above. In addition, we may have limited time to conduct due diligence and may
enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.
We may not be able to complete our initial
business combination within 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 stockholders may only receive $10.10 per share, or less
than such amount in certain circumstances, and our warrants will expire worthless.
Our initial stockholders, officers and directors
have agreed that we must complete our initial business combination within 12 months (or up to 18 months, if extended) from the closing
of this offering. 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 continued outbreak of COVID-19 may negatively
impact businesses we may seek to acquire. If we have not completed our initial business combination within such 12-month period (or up
to 18 months, if extended), 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, subject to lawfully available funds therefor, redeem 100% of the public shares,
at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on
the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution
expenses), divided by the number of then-outstanding public shares, which redemption will completely extinguish public stockholders’
rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors,
dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements
of other applicable law, in which case, our public stockholders may only receive $10.10 per share, or less than such amount in certain
circumstances, and our warrants will expire worthless. See “— If third parties bring claims against us, the proceeds held
in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.10 per share”
and other risk factors herein.
Our search for an initial business combination,
and any target business with which we ultimately consummate an initial business combination, may be materially adversely affected by the
recent coronavirus (COVID-19) outbreak and the status of debt and equity markets.
In March 2020, the World Health Organization
declared novel coronavirus disease 2019 (COVID-19) a global pandemic. The COVID-19 pandemic has impacted negatively the global economy,
disrupted global supply chains, lowered equity market valuations, created significant volatility and disruption in financial markets,
and increased unemployment levels, all of which may become heightened concerns upon a second wave of infection or future developments.
In addition, the pandemic has resulted in temporary closures of many businesses and the institution of social distancing and sheltering
in place requirements in many states and communities. The COVID-19 pandemic has and a significant outbreak of other infectious diseases
could result in a widespread health crisis that could adversely affect the economies and financial markets worldwide, and the business
of any potential partner business with which we consummate an initial business combination could be materially and adversely affected.
Furthermore, we may be unable to complete an initial
business combination if concerns relating to COVID-19 continue to restrict travel, limit the ability to have meetings with potential investors
or the partner business’s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in
a timely manner. The extent to which COVID-19 impacts our search for an initial 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. While vaccines for COVID-19 are being, and have been, developed and
deployed, and restrictions have been easing in certain jurisdictions, there is no guarantee that any such vaccine will be effective, work
as expected, be made available, or will be accepted on a significant scale, or that restrictions will continue to ease in a timely manner.
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. If the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time,
our ability to consummate an initial business combination, or the operations of a partner business with which we ultimately consummate
an initial business combination, may be materially adversely affected.
In addition, our ability to consummate a transaction
may be dependent on the ability to raise equity and debt financing that 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.
If we seek stockholder approval of our initial
business combination, our sponsor, directors, officers, advisors and their affiliates may elect to purchase shares from stockholders,
in which case they may influence a vote in favor of a proposed initial business combination that you do not support.
If we seek stockholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares in privately negotiated transactions either
prior to or following the consummation of our initial business combination. Such purchases will not be made if our sponsor, directors,
officers, advisors or their affiliates are in possession of any material non-public information that has not been disclosed to the selling
stockholder. Such a purchase would include a contractual acknowledgement that such stockholder, although still the record holder of our
shares is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that our sponsor,
directors, officers, advisors or their affiliates purchase shares in privately negotiated transactions from public stockholders who have
already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem
their shares. It is intended that, if Rule 10b-18 would apply to purchases by our sponsor, directors, officers, advisors or their
affiliates, then such purchases will comply with Rule 10b-18 under the Exchange Act, to the extent it applies, which provides a safe
harbor for purchases made under certain conditions, including with respect to timing, pricing and volume of purchases.
The purpose of such purchases would be to (1) increase
the likelihood of obtaining stockholder approval of the initial business combination or (2) satisfy a closing condition in an agreement
with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of the initial business combination,
where it appears that such requirement would otherwise not be met. This may result in the consummation of our initial business combination
that may not otherwise have been possible.
If a stockholder fails to receive notice
of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for
tendering its shares, such shares may not be redeemed.
We will comply with the tender offer rules or
proxy rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance with
these rules, if a stockholder fails to receive our tender offer or proxy materials, as applicable, such stockholder may not become aware
of the opportunity to redeem its shares. In addition, proxy materials or tender offer documents, as applicable, that we will furnish to
holders of our public shares in connection with our initial business combination will describe the various procedures that must be complied
with in order to validly tender or redeem public shares. For example, we may require our public stockholders seeking to exercise their
redemption rights, whether they are record holders or hold their shares in “street name,” to either tender their certificates
to our transfer agent prior to the date set forth in the tender offer documents mailed to such holders, or up to two business days prior
to the vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their
shares to the transfer agent electronically. In the event that a stockholder fails to comply with these or any other procedures, its shares
may not be redeemed.
Purchases of our public shares in the open
market or in privately negotiated transactions by our sponsor, directors, officers, advisors or their affiliates may make it difficult
for us to maintain the listing of our shares on a national securities exchange following the consummation of our initial business combination.
If our sponsor, directors, officers, advisors
or their affiliates purchase our public shares in the open market or in privately negotiated transactions, the public “float”
of our shares of common stock and the number of beneficial holders of our securities would both be reduced, possibly making it difficult
to maintain the listing or trading of our securities on a national securities exchange following consummation of the initial business
combination.
You will not have any rights or interests
in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced
to sell your public shares, potentially at a loss.
Our public stockholders will be entitled to
receive funds from the trust account only upon the earliest to occur of: (i) our completion of our initial business combination,
and then only in connection with those shares of common stock that such stockholder properly elected to redeem, subject to the limitations
described herein, (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our
amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in
connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination
within 12 months (or up to 18 months, if extended) from the closing of this offering or (B) with respect to any other provision
relating to stockholders’ rights or pre-initial business combination activity and (iii) the redemption of our public shares
if we are unable to complete our initial business combination within 12 months (or up to 18 months, if extended) from the closing of
this offering, subject to applicable law and as further described herein. In no other circumstances will a stockholder have any right
or interest of any kind to the funds in the trust account. Accordingly, to liquidate your investment, you may be forced to sell your
public shares, potentially at a loss.
A.G.P. has a conflict of interest in connection
with this offering, and with respect to rendering services to us in connection with our initial business combination.
A.G.P. has a “conflict of interest”
within the meaning of FINRA Rule 5121(f)(5)(B) in this offering because it beneficially owns more than 10% of our shares. Due
to this conflict of interest, The Benchmark Company, LLC is acting as a “qualified independent underwriter” in accordance
with FINRA Rule 5121, which requires, among other things, that a qualified independent underwriter participate in the preparation
of, and exercise the usual standards of “due diligence” with respect to, this prospectus and the registration statement of
which it forms a part. The Benchmark Company, LLC will be paid a fee from the total underwriting discount in this offering in consideration
for its services and expenses as qualified independent underwriter. See “Underwriting — Conflicts of Interest”
for further information.
In addition, A.G.P. will assist us in connection
with our initial business combination. The representative shares transferred by our sponsor to A.G.P. and/or its designees will be worthless,
and A.G.P. will not receive the initial business combination marketing fee described in “Underwriting – Conflicts of Interest”,
if we do not consummate our initial business combination. Therefore, if A.G.P. provides services to us in connection with our initial
business combination, these financial interests may result in the representative having a conflict of interest when providing such services
to us.
We may engage A.G.P. or its affiliates to
provide additional services to us after this offering, which may include acting as financial advisor in connection with our initial business
combination or as placement agent in connection with a related financing transaction. A.G.P. is entitled to receive a business combination
marketing fee only on a completion of our initial business combination. These financial incentives may cause A.G.P. to have potential
conflicts of interest in rendering any such additional services to us after this offering, including, for example, in connection with
the sourcing and consummation of our initial business combination.
A.G.P.
will provide certain marketing and related services regarding the initial business combination, for which A.G.P. will be paid the initial
business combination marketing fee described in “Underwriting – Conflicts of Interest”. Payment of the business
combination marketing fee that is conditioned on the completion of our initial business combination. The fact that A.G.P. or its affiliates’
financial interests are tied to the consummation of an initial business combination transaction may give rise to potential conflicts of
interest in providing any such additional services to us, including potential conflicts of interest in connection with the sourcing and
consummation of our initial business combination.
In
addition, we may engage A.G.P. or its affiliates to provide additional services to us after this offering, including, for example,
providing financial advisory services, acting as a placement agent in a private offering, or arranging debt financing. We may pay A.G.P.
or its affiliates fair and reasonable fees or other compensation that would be determined at that time in an arm’s length negotiation;
provided that no agreement will be entered into with A.G.P. its affiliates and no fees or other compensation for such services will be
paid to the underwriter or its affiliates prior to the date that is 60 days from the date of this prospectus, unless such payment would
not be deemed underwriting compensation in connection with this offering.
You will not be entitled to protections
normally afforded to investors of many other blank check companies.
Because the net proceeds of this offering are
intended to be used to complete our initial 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, because we will have net tangible assets in
excess of $5,000,001 upon the successful consummation of this offering and will expect to file a Current Report on Form 8-K, including
an audited balance sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check
companies, such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Among other
things, this means our units will be immediately tradable and we will have a longer period of time to complete our initial business combination
than do companies subject to Rule 419. Moreover, offerings subject to Rule 419 would prohibit the release of any interest earned
on funds held in the trust account to us. For a more detailed comparison of our offering to offerings that comply with Rule 419,
please see “Proposed Business — Comparison of Offering to Blank Check Companies Subject to Rule 419.”
Because of our limited resources and
the significant competition for initial business combination opportunities, it may be more difficult for us to complete our initial business
combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.10
per share on our redemption of our public shares, or less than such amount in certain circumstances, and our warrants will expire worthless.
We expect to encounter
intense competition from other entities having a business objective similar to ours, including private investors (which may be individuals
or investment partnerships), other blank check companies and other entities competing for the types of businesses we intend to acquire,
including affiliates of our sponsor. Many of these individuals and entities are well established and have extensive experience in identifying
and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these
competitors possess greater technical, human and other resources or more industry knowledge than we do, and our financial resources will
be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses
we could potentially acquire with the net proceeds of this offering and the sale of the private placement units, our ability to compete
with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. This
inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, because
we are obligated to pay cash for the shares of common stock that our public stockholders redeem in connection with our initial business
combination, target companies will be aware that this may reduce the resources available to us for our initial business combination.
This may place us at a competitive disadvantage in successfully negotiating our initial business combination. If we are unable to complete
our initial business combination, our public stockholders may receive only approximately $10.10 per share, or less in certain circumstances,
on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may
receive less than $10.10 per share upon our liquidation. See “— If third parties bring claims against us, the proceeds
held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.10 per share”
and other risk factors herein.
If we do not have sufficient working
capital to allow us to operate for at least the next 12 months (or up to 18 months, if extended), we may be unable to complete our initial
business combination, in which case our public stockholders may only receive $10.10 per share, or less than such amount in certain circumstances,
and our warrants will expire worthless.
The funds available to us outside of the trust
account, together with any interest income earned on amounts in the trust account, may not be sufficient to allow us to operate for at
least the next 12 months (or up to 18 months, if extended), assuming that our initial business combination is not completed during that
time. Management’s plans to address this need for capital through this offering and potential loans from certain of our affiliates
are discussed in the section of this prospectus titled “Management’s Discussion and Analysis of Financial Condition and
Results of Operations.” However, our affiliates are not obligated to make loans to us in the future, and we may not be able
to raise additional financing from unaffiliated parties necessary to fund our expenses. We believe that, upon closing of this offering,
the funds available to us outside of the trust account, together with loans that may be made by our sponsor, will be sufficient to allow
us to operate for at least the next 12 months (or up to 18 months, if extended); however, we cannot assure you that our estimate is accurate.
Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with our search
for a target business. We could also use a portion of the funds as a down payment or to fund a “no-shop” provision (a provision
in letters of intent or merger agreements designed to keep target businesses from “shopping” around for transactions with
other companies on terms more favorable to such target businesses) with respect to a particular proposed initial business combination,
although we do not have any current intention to do so. If we entered into a letter of intent or merger agreement where we paid for the
right to receive exclusivity from a target business and were subsequently required to forfeit such funds (whether as a result of our
breach or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence with respect to, a target
business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.10
per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. In certain
circumstances, our public stockholders may receive less than $10.10 per share upon our liquidation. See “— If third parties
bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders
may be less than $10.10 per share” and other risk factors herein.
If we do not have sufficient working capital,
it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination,
and we may need to seek additional loans from our sponsor to fund our search for our initial business combination, to pay our taxes, and
to complete our initial business combination. If we are unable to obtain these loans, we may be unable to complete our initial business
combination.
Of
the net proceeds of this offering and the sale of the private placement units, only approximately $1,425,000 will be available to us
initially outside the trust account to fund our working capital requirements. In the event that our offering expenses exceed our estimate
of $1,185,000 (including underwriting discounts and commissions of $500,000), we may fund such excess with funds not to be held
in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease by a corresponding
amount. The amount held in the trust account will not be impacted by such increase or decrease. Conversely, in the event that the offering
expenses are less than our estimate of $1,185,000, the amount of funds we intend to be held outside the trust account would increase
by a corresponding amount. If we are required to seek additional capital, we would need to borrow funds from our sponsor, management
team or other third parties to operate or may be forced to liquidate. None of our sponsor, members of our management team nor any of
their affiliates is under any obligation to advance additional funds to us in such circumstances. Any such advances would be repaid only
from funds held outside the trust account or from funds released to us upon completion of our initial business combination. Prior to
the completion of our initial business combination, we do not expect to seek loans from parties other than our sponsor or an affiliate
of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights
to seek access to funds in our trust account. If we are unable to obtain these loans, we may be unable to complete our initial business
combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we
will be forced to cease operations and liquidate the trust account. Consequently, our public stockholders may only receive approximately
$10.10 per share on our redemption of our public shares, and our warrants will expire worthless. In certain circumstances, our public
stockholders may receive less than $10.10 per share on the redemption of their shares. See “— If third parties bring claims
against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may
be less than $10.10 per share” and other risk factors herein.
If we seek stockholder approval of our initial
business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a “group” of stockholders
are deemed to hold in excess of 15% of our shares of common stock, you will lose the ability to redeem all such shares in excess of 15%
of our shares of common stock.
If we seek stockholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
rules, our amended and restated certificate of incorporation will provide that a public stockholder, individually or together with any
affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined
under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate of
15% of the shares sold in this offering. Your inability to redeem more than an aggregate of 15% of the shares sold in this offering will
reduce your influence over our ability to consummate our initial business combination and you could suffer a material loss on your investment
in us if you sell such excess shares in open market transactions. As a result, you will continue to hold that number of shares exceeding
15% and, in order to dispose of such shares, you would be required to sell your shares in open market transaction, potentially at a loss.
Subsequent to our consummation of our initial
business combination, we may be required to take write- downs or write-offs, restructuring and impairment or other charges.
Even
if we conduct thorough due diligence on a target business with which we combine, this diligence may not surface all material issues that
may be present inside a particular target business, that it would be possible to uncover all material issues through a customary amount
of due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result of these
factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or other charges that
could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and
previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be
non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative
market perceptions about us or our securities. In addition, charges of this nature may cause us to violate net worth or other covenants
to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining post-combination
debt financing. Accordingly, any security holders who choose to remain security holders following our initial business combination
could suffer a reduction in the value of their securities. Such security holders are unlikely to have a remedy for such reduction in value
unless they are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or
other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy solicitation
or tender offer materials, as applicable, relating to our initial business combination constituted an actionable material misstatement
or omission.
If third parties bring claims against
us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less
than $10.10 per share.
Our placing of funds in the trust account may
not protect those funds from third-party claims against us. Although we will seek to have all vendors, service providers, prospective
target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim
of any kind in or to any monies held in the trust account for the benefit of our public stockholders, such parties may not execute such
agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust account, including,
but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the
enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds
held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account,
our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that
has not executed a waiver if management believes that such third party’s engagement would be significantly more beneficial to us
than any alternative. Making such a request of potential target businesses may make our acquisition proposal less attractive to them and,
to the extent prospective target businesses refuse to execute such a waiver, it may limit the field of potential target businesses that
we might pursue. Marcum LLP, our independent registered public accounting firm, and the underwriters of the offering, will not execute
agreements with us waiving such claims to the monies held in the trust account.
Examples of possible instances where we may
engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise or
skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or
in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such
entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or
agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we are
unable to complete our initial business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection
with our initial business combination, we will be required to provide for payment of claims of creditors that were not waived that may
be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount received by public stockholders
could be less than the $10.10 per share initially held in the trust account, due to claims of such creditors. Pursuant to the letter
agreements, our initial stockholders have agreed that they will be liable to us if and to the extent any claims by a third party (other
than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business
with which we have entered into a written letter of intent, confidentiality or similar agreement or initial business combination agreement,
reduce the amount of funds in the trust account to below the lesser of (i) $10.10 per public share and (ii) the actual amount
per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.10 per share due
to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third
party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or
not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of this offering against certain
liabilities, including liabilities under the Securities Act. However, we have not asked our initial stockholders 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 cannot assure you that our initial stockholders
would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including,
without limitation, claims by vendors and prospective target businesses.
Our directors may decide not to enforce
indemnification obligations against our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution
to our public stockholders.
In the event that the proceeds in the trust
account are reduced below $10.10 per share (whether or not the underwriters’ over-allotment option is exercised in full), 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 on our behalf whether to take legal action against our sponsor to enforce its indemnification
obligations. While we currently expect that our independent directors would take legal action on our behalf against our sponsor to enforce
its indemnification obligations to us, 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 on our
behalf, the amount of funds in the trust account available for distribution to our public stockholders may be reduced below $10.10 per
share.
We may not have sufficient funds to satisfy
indemnification claims of our directors and officers.
We
have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors have agreed
to waive any right, title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against the
trust account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we
have sufficient funds outside of the trust account or (ii) we consummate our initial business combination. Our obligation to indemnify
our officers and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their fiduciary
duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors,
even though such an action, if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder’s investment
may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant to
these indemnification provisions.
If, after we distribute the proceeds in
the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us
that is not dismissed, a bankruptcy court may seek to recover such proceeds, and we and our board may be exposed to claims of punitive
damages.
If, after we distribute the proceeds in the trust
account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not
dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either
a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover
some or all amounts received by our stockholders. In addition, our board of directors may be viewed as having breached its fiduciary duty
to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying public stockholders
from the trust account prior to addressing the claims of creditors.
If, before distributing the proceeds in
the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us
that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share
amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.
If, before distributing the proceeds in the trust
account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not
dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy
estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims
deplete the trust account, the per-share amount that would otherwise be received by our stockholders in connection with our liquidation
may be reduced.
Our stockholders may be held liable for
claims by third parties against us to the extent of distributions received by them upon redemption of their shares.
Under the Delaware General Corporation Law,
as amended, or DGC, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions
received by them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders upon the redemption
of our public shares in the event we do not complete our initial business combination within 12 months (or up to 18 months, if extended)
from the closing of this offering may be considered a liquidating distribution under Delaware law. If a corporation complies with certain
procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it,
including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which
the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made
to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s
pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after
the third anniversary of the dissolution. However, it is our intention to redeem our public shares as soon as reasonably possible following
the 12th month (or up to the 18th month, if extended) from the closing of this offering in the event we do not complete our initial business
combination and, therefore, we do not intend to comply with the foregoing procedures.
Because we will not be complying with Section 280,
Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment
of all existing and pending claims or claims that may be potentially brought against us within the 10 years following our dissolution.
However, because we are a blank check company, rather than an operating company, and our operations will be limited to searching for
prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.)
or prospective target businesses. If our plan of distribution complies with Section 281(b) of the DGCL, any liability of stockholders
with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount
distributed to the stockholder, and any liability of the stockholder would likely be barred after the third anniversary of the dissolution.
We cannot assure you that we will properly assess all claims that may be potentially brought against us. As such, our stockholders could
potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders
may extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of our trust account distributed to our public
stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 12 months
(or up to 18 months, if extended) from the closing of this offering is not considered a liquidating distribution under Delaware law and
such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring
or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations
for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of
a liquidating distribution.
We may not hold an annual meeting of stockholders
until after the consummation of our initial business combination, which could delay the opportunity for our stockholders to elect directors.
In accordance with Nasdaq corporate governance
requirements, we are not required to hold an annual meeting until no later than one year after our first fiscal year end following our
listing on Nasdaq. Under Section 211(b) of the DGCL, however, we are required to hold an annual meeting of stockholders for
the purposes of electing directors in accordance with our bylaws unless such election is made by written consent in lieu of such a meeting.
We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial business combination,
and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting. Therefore, if our stockholders
want us to hold an annual meeting prior to the consummation of our initial business combination, they may attempt to force us to hold
one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL
The securities in which we invest the
proceeds held in the trust account could bear a negative rate of interest, which could reduce the interest income available for payment
of taxes or reduce the value of the assets held in trust such that the per-share redemption amount received by stockholders may be less
than $10.10 per share.
The net proceeds of this offering, as well
as a portion of the proceeds of the sale of the private placement units in the private placement, in the aggregate amount of $101,000,000
or $116,150,000 if the underwriters’ over-allotment is exercised in full ($10.10 per unit) will be held in an interest-bearing
trust account. The proceeds held in the trust account may only be invested only in U.S. government treasury bills 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 that
invest only in direct U.S. government treasury obligations. While short-term U.S. treasury obligations currently yield a positive rate
of interest, they have briefly yielded negative interest rates in recent years. Central banks in Europe and Japan pursued interest rates
below zero in recent years, and the Open Market Committee of the Federal Reserve has not ruled out the possibility that it may in the
future adopt similar policies in the United States. In the event of very low or negative yields, the amount of interest income (that
we may use to pay our taxes, if any) would be reduced. In the event that we are unable to complete our initial business combination,
our public stockholders are entitled to receive their pro-rata share of the proceeds then held in the trust account and not
previously released to us to pay our taxes, plus any interest income (less up to $100,000 of interest to pay dissolution costs and expenses).
If the balance of the trust account is reduced below $101,000,000 ($116,150,000 if the underwriters’ over-allotment is exercised
in full) due to negative interest rates, the amount of funds in the trust account available for distribution to our public stockholders
may be reduced below $10.10 per share.
If we are deemed to be an investment company
under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted,
which may make it difficult for us to complete our initial business combination.
If we are deemed to be an investment company under
the Investment Company Act, our activities may be restricted, including restrictions on the nature of our investments and restrictions
on the issuance of securities, each of which may make it difficult for us to complete our initial business combination. In addition, we
may have imposed upon us burdensome requirements, including registration as an investment company, adoption of a specific form of corporate
structure and reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations.
In order not to be regulated as an investment
company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business
other than investing, reinvesting or trading in securities and that our activities do not include investing, reinvesting, owning, holding
or trading “investment securities” constituting more than 40% of our total assets (exclusive of U.S. government securities
and cash items) on an unconsolidated basis. Our business will be to identify and complete our initial business combination and thereafter
to operate the post-transaction business or assets for the long term. We do not plan to buy businesses or assets with a view to resale
or profit from their resale. We do not plan to buy unrelated businesses or assets or to be a passive investor.
We do not believe that our anticipated principal
activities will subject us to the Investment Company Act. To this end, the proceeds held in the trust account may only be invested in
United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity
of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company
Act that invest only in direct U.S. government treasury obligations. Pursuant to the trust agreement, the trustee is not permitted to
invest in other securities or assets. By restricting the investment of the proceeds to these instruments, and by having a business plan
targeted at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a merchant
bank or private equity fund), we intend to avoid being deemed an “investment company” within the meaning of the Investment
Company Act. This offering is not intended for persons who are seeking a return on investments in government securities or investment
securities.
The trust account is intended as a holding
place for funds pending the earliest to occur of: (i) the completion of our initial business combination; (ii) the redemption
of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation
(A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination
or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months, if
extended) from the closing of this offering or (B) with respect to any other provision relating to stockholders’ rights or
pre-initial business combination activity; or (iii) absent our initial business combination within 12 months (or up to 18 months,
if extended) from the closing of this offering, our return of the funds held in the trust account to our public stockholders as part
of our redemption of the public shares. If we do not invest the proceeds as discussed above, we may be deemed to be subject to the Investment
Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would
require additional expenses for which we have not allotted funds and may hinder our ability to consummate our initial business combination.
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, the SEC. 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 also may 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.
If we are unable to consummate our initial
business combination, our public stockholders may be forced to wait up to 12 months or longer from the date of our initial public offering
before redemption from our trust account.
If we are unable to consummate our initial
business combination within 12 months (or up to 18 months, if extended) from the closing of this offering, we will, as promptly as reasonably
possible but not more than five business days thereafter (subject to our amended and restated certificate of incorporation and applicable
law), distribute the aggregate amount then on deposit in the trust account (net of taxes payable), pro rata to our public stockholders
by way of redemption and cease all operations except for the purposes of winding up of our affairs by way of a voluntary liquidation,
as further described herein. Any redemption of public stockholders from the trust account shall be effected as required by our amended
and restated certificate of incorporation prior to our commencing any voluntary liquidation. Except as otherwise described herein, we
have no obligation to return funds to investors prior to the date of any redemption required as a result of our failure to consummate
our initial business combination within the period described above or our liquidation, unless we consummate our initial business combination
prior thereto and only then in cases where investors have sought to redeem their shares of common stock. Only upon any such redemption
of public shares as we are required to effect or any liquidation will public stockholders be entitled to distributions if we are unable
to complete our initial business combination.
The grant of registration rights to our
initial stockholders (including the representative) may make it more difficult to complete our initial business combination, and the future
exercise of such rights may adversely affect the market price of our shares of common stock.
Pursuant to an agreement to be entered into on
the date of this prospectus, our initial stockholders and their permitted transferees can demand that we register the founder shares,
the representative shares, the private placement units and the underlying securities. We will bear the cost of registering these securities.
The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect
on the market price of our shares of common stock. In addition, the existence of the registration rights may make our initial business
combination more costly or difficult to conclude. This is because the stockholder of the target business may increase the equity stake
they seek in the combined entity or ask for more cash consideration to offset the negative impact on the market price of our shares of
common stock that is expected when the securities owned by our sponsor, holders of our private placement units or their respective permitted
transferees are registered.
Because we are neither limited to evaluating
a target business in a particular industry sector nor have we selected any specific target businesses with which to pursue our initial
business combination, you will be unable to ascertain the merits or risks of any particular target business’s operations.
We will seek to complete our initial business
combination with an operating company in any industry or sector, though we intend to focus on the financial services, healthcare, real
estate services, technology and software industries, except that we will not, under our amended and restated certificate of incorporation,
be permitted to effectuate our initial business combination with another blank check company or similar company with nominal operations.
Because we have not yet selected or approached any specific target business with respect to an initial business combination, there is
no basis to evaluate the possible merits or risks of any particular target business’s operations, results of operations, cash flows,
liquidity, financial condition or prospects. To the extent we complete our initial business combination, we may be affected by numerous
risks inherent in the business operations with which we combine. For example, if we combine with a financially unstable business or an
entity lacking an established record of sales or earnings, we may be affected by the risks inherent in the business and operations of
a financially unstable or a development stage entity. Although our officers and directors will endeavor to evaluate the risks inherent
in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or
that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us
with no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that
an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity were
available, in an initial business combination target. Accordingly, any security holders who choose to remain security holders following
our initial business combination could suffer a reduction in the value of their securities. Such security holders are unlikely to have
a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach by our officers
or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities
laws that the proxy solicitation or tender offer materials, as applicable, relating to the initial business combination contained an actionable
material misstatement or material omission.
We may seek investment opportunities outside
our management’s area of expertise and our management may not be able to adequately ascertain or assess all significant risks associated
with the target company.
There
are no limitations on the industries or business sectors we may consider when contemplating our initial business combination. Therefore,
we may consider an initial business combination in sectors that may be outside of our management’s areas of expertise if such initial
business combination candidate is presented to us and we determine that such candidate offers an attractive acquisition opportunity for
our company. Although our management will endeavor to evaluate the risks inherent in any particular initial business combination candidate,
we cannot assure you that we will adequately ascertain or assess all of the significant risk factors. We also cannot assure you that an
investment in our units will not ultimately prove to be less favorable to investors in this offering than a direct investment, if an opportunity
were available, in our initial business combination candidate. In the event we elect to pursue an acquisition outside of the areas of
our management’s expertise, our management’s expertise may not be directly applicable to its evaluation or operation, and
the information contained in this prospectus regarding the areas of our management’s expertise would not be relevant to an understanding
of the business that we elect to acquire. As a result, our management may not be able to adequately ascertain or assess all of the significant
risk factors relevant to such acquisition. Accordingly, any security holders who choose to remain security holders following our initial
business combination could suffer a reduction in the value of their securities. Such security holders are unlikely to have a remedy for
such reduction in value.
Although we identified general criteria
and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination
with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial
business combination may not have attributes entirely consistent with our general criteria and guidelines.
Although
we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business
with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial
business combination with a target that does not meet some or all of these criteria and guidelines, such combination may not be as successful
as a combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective
initial business combination with a target that does not meet our general criteria and guidelines, a greater number of stockholders may
exercise their redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires
us to have a minimum net worth or a certain amount of cash. In addition, if stockholder approval of the transaction is required by applicable
law or stock exchange rules, or we decide to obtain stockholder approval for business or other reasons, it may be more difficult for
us to attain stockholder approval of our initial business combination if the target business does not meet our general criteria and guidelines.
If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.10 per share,
or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. See “—
If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount
received by stockholders may be less than $10.10 per share” and other risk factors.
Management’s flexibility in identifying
and selecting a prospective acquisition candidate, along with our management’s financial interest in consummating our initial business
combination, may lead management to enter into an acquisition agreement that is not in the best interest of our stockholders.
Subject to the requirement that our initial business
combination must be with one or more target businesses or assets having an aggregate fair market value of at least 80% of the value of
the trust account (excluding the fee payable to A.G.P. upon an initial business combination as described in “Underwriting - Conflicts
of Interest” and taxes payable on the interest earned on the trust account) at the time of the agreement to enter into such initial
business combination, we will have virtually unrestricted flexibility in identifying and selecting a prospective acquisition candidate.
Investors will be relying on management’s ability to identify initial business combinations, evaluate their merits, conduct or monitor
diligence and conduct negotiations. Management’s flexibility in identifying and selecting a prospective acquisition candidate, along
with management’s financial interest in consummating our initial business combination, may lead management to enter into an acquisition
agreement that is not in the best interest of our stockholders.
We may seek initial business combination
opportunities with an early stage company, a financially unstable business or an entity lacking an established record of revenue, cash
flow or earnings, which could subject us to volatile revenues, cash flows or earnings or difficulty in retaining key personnel.
To the extent we complete our initial business
combination with an early stage company, a financially unstable business or an entity lacking an established record of sales or earnings,
we may be affected by numerous risks inherent in the operations of the business with which we combine. These risks include investing in
a business without a proven business model and with limited historical financial data, volatile revenues or earnings, intense competition
and difficulties in obtaining and retaining key personnel. Although our officers and directors will endeavor to evaluate the risks inherent
in a particular target business, we may not be able to properly ascertain or assess all of the significant risk factors and we may not
have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability
to control or reduce the chances that those risks will adversely impact a target business.
We are not required to obtain an opinion
from an independent investment banking firm, and consequently, an independent source may not confirm that the price we are paying for
the business is fair to our stockholders from a financial point of view.
Unless we consummate our initial business combination
with entity that is affiliated with our sponsor, officers, or directors, we are not required to obtain an opinion from an independent
investment banking firm that the price we are paying is fair to our stockholders from a financial point of view. If no opinion is obtained,
our stockholders will be relying on the judgment of our board of directors, who will determine fair market value based on standards generally
accepted by the financial community. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials,
as applicable, related to our initial business combination.
Resources could be wasted in researching
acquisitions that are not consummated.
We
anticipate that the investigation of each specific target business and the negotiation, drafting, and execution of relevant agreements,
disclosure documents, and other instruments will require substantial management time and attention, and substantial costs for accountants,
attorneys and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point for the
proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we
may fail to consummate our initial business combination for any number of reasons including those beyond our control. Any such event
will result in a loss to us of the related costs incurred, which could materially adversely affect subsequent attempts to locate and
acquire or merge with another business. If we are unable to complete our initial business combination, our public stockholders may only
receive $10.10 per share or even less (whether or not the underwriters’ over-allotment option is exercised in full) on our redemption,
and our warrants will expire worthless. See “— If third parties bring claims against us, the proceeds held in the
trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.10 per share”
and other risk factors herein.
We may only be able to complete one initial
business combination with the proceeds of this offering, which will cause us to be solely dependent on a single business, which may have
a limited number of products or services. This lack of diversification may negatively impact our operations and profitability.
The net proceeds from this offering, together
with a portion of the funds we will receive from the sale of the private placement units in the private placement, will provide us with
approximately $101,000,000 (or approximately $116,150,000 if the underwriters’ over-allotment option is exercised in full) that
we may use to complete our initial business combination.
We may effectuate our initial business combination
with a single target business or multiple target businesses simultaneously. However, we may not be able to effectuate our initial business
combination with more than one target business because of various factors, including the existence of complex accounting issues and the
requirement that we prepare and file pro forma financial statements with the SEC that present operating results and the financial condition
of several target businesses as if they had been operated on a combined basis. By consummating our initial business combination with only
a single entity, our lack of diversification may subject us to numerous economic, competitive and regulatory developments. Further, we
would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities,
which may have the resources to complete several initial business combinations in different industries or different areas of a single
industry. Accordingly, the prospects for our success may be solely dependent upon the performance of a single business, property or asset,
or dependent upon the development or market acceptance of a single or limited number of products 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 our initial business combination.
We may attempt to simultaneously consummate
initial business combinations with multiple prospective targets, which may hinder our ability to consummate our initial business combination
and give rise to increased costs and risks that could negatively impact our operations and profitability.
If we determine to simultaneously acquire several
businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent
on the simultaneous closings of the other initial business combinations, which may make it more difficult for us, and delay our ability,
to complete our initial business combination. With multiple initial business combinations, we could also face additional risks, including
additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers)
and the additional risks associated with the subsequent assimilation of the operations and services or products of the acquired companies
in a single operating business. If we are unable to adequately address these risks, it could negatively impact our profitability and results
of operations.
We may attempt to consummate our initial
business combination with a private company about which little information is available.
In pursuing our acquisition strategy, we may seek
to effectuate our initial business combination with a privately held company. By definition, very little public information exists about
private companies, and we could be required to make our decision on whether to pursue a potential initial business combination on the
basis of limited information, which may result in our initial business combination with a company that is not as profitable as we suspected,
if at all.
Because we must furnish our stockholders
with target business financial statements prepared in accordance with U.S. generally accepted accounting principles or international financial
reporting standards, we may lose the ability to complete an otherwise advantageous initial business combination with some prospective
target businesses.
The federal proxy rules require that a proxy
statement with respect to a vote on an initial 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 as issued by the International Accounting Standards Board or the IASB, 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 substantially 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. These financial statement requirements may limit
the pool of potential target businesses we may consummate our initial business combination with because some targets may be unable to
provide such statements in time for us to disclose such statements in accordance with federal proxy rules and complete our initial
business combination within the prescribed time frame.
Our initial business combination and our
structure thereafter may not be tax-efficient to our stockholders and warrant holders. As a result of our initial business combination,
our tax obligations may be more complex, burdensome and uncertain.
Although we will attempt to structure our initial
business combination in a tax-efficient manner, tax structuring considerations are complex, the relevant facts and law are uncertain and
may change, and we may prioritize commercial and other considerations over tax considerations. For example, in connection with our initial
business combination and subject to requisite stockholder approval, we may structure our initial business combination in a manner that
requires stockholders and/or warrant holders to recognize gain or income for tax purposes. We do not intend to make any cash distributions
to stockholders or warrant holders to pay taxes in connection with our initial business combination or thereafter. Accordingly, a stockholder
or a warrant holder may need to satisfy any liability resulting from our initial business combination with cash from its own funds or
by selling all or a portion of such holder's shares or warrants. In addition, we may effect an initial business combination with a target
company in another jurisdiction or reincorporate in a different jurisdiction (including, but not limited to, the jurisdiction in which
the target company or business is located). As a result, stockholders and warrant holders may be subject to additional income, withholding
or other taxes with respect to their ownership of us after our initial business combination.
Furthermore, we may effect an initial business
combination with a target company that has business operations outside of the United States, and, possibly, business operations in multiple
jurisdictions. If we effect such an initial business combination, we could be subject to significant income, withholding and other tax
obligations in a number of jurisdictions with respect to income, operations and subsidiaries related to those jurisdictions. Due to the
complexity of tax obligations and filings in other jurisdictions, we may have a heightened risk related to audits or examinations by taxing
authorities. This additional complexity and risk could have an adverse effect on our after-tax profitability and financial condition.
Risks Related to our Sponsor and Management
Team and Their Respective Affiliates, and to the Post-Business Combination Company
Our ability to effect successfully our initial
business combination, and to be successful thereafter, will be largely dependent upon the efforts of our officers, directors and key personnel,
some of whom may join us following our initial business combination.
Our operations are dependent upon a relatively
small group of individuals and, in particular, our officers and directors. We believe that our success depends on the continued service
of our officers and directors, at least until we have consummated our initial business combination. In addition, our officers and directors
are not required to commit any specified amount of time to our affairs and, accordingly, will have conflicts of interest in allocating
management time among various business activities, including identifying potential initial business combinations and monitoring the related
due diligence. We do not have an employment agreement with, or key person insurance on the life of, any of our directors or officers.
The unexpected loss of the services of one or more of our directors or officers could have a detrimental effect on us.
However, the role of any of our officers or directors
in the target business, after consummation of the initial business combination, cannot presently be ascertained. Although some of such
persons may remain with the target business in senior management or advisory positions following our initial business combination, it
is likely that some or all of the management of the target business will remain in place. While we intend to closely scrutinize any individuals
we may engage after our initial business combination, our assessment of these individuals may not 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 that
may adversely affect our operations.
Our key personnel may negotiate employment
or consulting agreements with a target business in connection with a particular initial business combination. These agreements may provide
for them to receive compensation following our initial business combination and, as a result, cause them to have conflicts of interest
in determining whether a particular initial business combination is the most advantageous.
Our key personnel may be able to remain with us
after the consummation of our initial business combination only if they are able to negotiate employment or consulting agreements in connection
with the initial business combination. Such negotiations would take place simultaneously with the negotiation of the initial business
combination and could provide for such individuals to receive compensation in the form of cash payments and/or our securities for services
they would render to us after the consummation of the initial business combination. The personal and financial interests of such individuals
may influence their motivation in identifying and selecting a target business. However, we believe the ability of such individuals to
remain with us after the consummation of our initial business combination will not be the determining factor in our decision as to whether
or not we will proceed with any potential initial business combination. There is no certainty, however, that any of our key personnel
will remain with us after the consummation of our initial business combination. Our key personnel may not remain in senior management
or advisory positions with us. The determination as to whether any of our key personnel will remain with us will be made at the time of
our initial business combination.
We may have a limited ability to assess
the management of a prospective target business and, as a result, may effectuate our initial business combination with a target business
whose management may not have the skills, qualifications or abilities to manage a public company.
When evaluating the desirability of effecting
our initial business combination with a prospective target business, our ability to assess the target business’ management may be
limited due to a lack of time, resources or information. Our assessment of the capabilities of the target’s management, therefore,
may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. If the target’s management
do not possess the skills, qualifications, or abilities necessary to manage a public company, the operations and profitability of the
post-combination business may be negatively impacted.
If our management following our initial
business combination is unfamiliar with U.S. 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, any
or all of our management could resign from their positions as our officers, and the management of the target business at the time of the
initial business combination could remain in place. Management of the target business may not be familiar with U.S. securities laws. If
new management is unfamiliar with U.S. securities 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 that may adversely affect our operations.
The officers and directors of an acquisition
candidate may resign upon consummation of our initial business combination. The loss of an acquisition target’s key personnel could
negatively impact the operations and profitability of our post-combination business.
The role of an acquisition candidate’s key
personnel upon the consummation of our initial business combination cannot be ascertained at this time. Although we contemplate that certain
members of an acquisition candidate’s management team will remain associated with the acquisition candidate following our initial
business combination, it is possible that some members of the management team of an acquisition candidate will not wish to remain in place.
As a result, we may need to reconstitute the management team of the post-transaction company in connection with our initial business combination,
which may adversely impact our ability to complete an acquisition in a timely manner or at all.
As the number of special purpose acquisition
companies increases, there may be more competition to find an attractive target for our initial business combination. This could increase
the costs associated with completing our initial business combination and may result in our inability to find a suitable target for our
initial business combination.
In recent years, the number of special purpose
acquisition companies that have been formed has increased substantially. Many companies have entered into initial business combinations
with special purpose acquisition companies, and there are still many special purpose acquisition companies seeking targets for their initial
business combination, as well as many additional special purpose acquisition companies currently in registration. As a result, at times,
fewer attractive targets may be available, and it may require more time, effort and resources to identify a suitable target for our initial
business combination.
In addition, because there are more special purpose
acquisition companies seeking to enter into our initial business combination with available targets, the competition for available targets
with attractive fundamentals or business models may increase, which could cause target 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 initial business combinations or operate targets post-initial business combination. This
could increase the cost of, delay or otherwise complicate or frustrate our ability to find a suitable target for and/or complete our initial
business combination.
Changes in the market for directors and
officers liability insurance could make it more difficult and more expensive for us to negotiate and complete our initial business combination.
In recent months, the market for directors and
officers liability insurance for special purpose acquisition companies has changed. Fewer insurance companies are offering quotes for
directors and officers liability coverage, the premiums charged for such policies have substantially 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 our 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-initial 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-initial business combination’s
ability to attract and retain qualified officers and directors.
In addition, even after we were to complete our
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 our initial business combination. As a result, in order to protect our directors and officers, the post-initial
business combination entity may need to purchase additional insurance with respect to any such claims. The need for such insurance would
be an added expense for the post-initial business combination entity, and could interfere with or frustrate our ability to consummate
our initial business combination on terms favorable to our investors.
Certain of our officers and directors are
now, or in the future may be, affiliated with entities engaged in business activities similar to those intended to be conducted by us
and, accordingly, may have conflicts of interest in allocating their time and determining to which entity a particular business opportunity
should be presented.
Following the completion of this offering and
until we consummate our initial business combination, we intend to engage in the business of identifying and combining with one or more
businesses. Our directors and officers may now be, or in the future become, affiliated with entities that are engaged in a similar business.
In addition, our directors and officers may become
aware of business opportunities that may be appropriate for presentation to us and the other entities to which they owe certain fiduciary
or contractual duties. 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 directors’ and officers’ fiduciary duties under the DGCL. Our amended and
restated certificate of incorporation will provide 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 ours
and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue,
and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation.
Our sponsor, directors and officers are also not
prohibited from sponsoring, investing or otherwise becoming involved with, any other blank check companies similar to ours, including
in connection with their initial business combinations, or may pursue other business or investment ventures during the period in which
we are seeking our initial business combination. Any such companies, businesses or ventures may present additional conflicts of interest
in pursuing our initial business combination. However, we do not believe that any such potential conflicts would materially affect our
ability to complete our initial business combination.
For a complete discussion of our officers’
and directors’ business affiliations and the potential conflicts of interest that you should be aware of, please see the sections
of this prospectus entitled “Management — Directors and Officers,” “Management — Conflicts of
Interest,” and “Related Party Transactions.”
Members of our management team and board
of directors have significant experience as founders, board members, officers or executives of other companies. As a result, certain of
those persons have been, or may become, involved in proceedings, investigations and litigation relating to the business affairs of the
companies with which they were, are, or may be in the future be, affiliated. These activities may have an adverse effect on us, which
may impeded our ability to consummate our initial business combination.
During the course of their careers, members of
our management team and board of directors have had significant experience as founders, board members, officers or executives of other
companies. As a result of their involvement and positions in these companies, certain of those persons , are now, or may in the future
become, involved in litigation, investigations or other proceedings relating to the business affairs of such companies or transactions
entered into by such companies. Any such litigation, investigations or other proceedings may divert the attention and resources of the
members of both our management team and our board of directors away from identifying and selecting a target business or businesses for
our initial business combination and may negatively affect our reputation, which may impede our ability to complete our initial business
combination.
Certain shares beneficially owned by our
initial stockholders, officers, and directors will not participate in liquidation distributions and, therefore, our officers and directors
may have a conflict of interest in determining whether a particular target business is appropriate for our initial business combination.
Our initial stockholders, officers, and directors
have waived their right to redeem any shares in connection with our initial business combination, or to receive distributions with respect
to their founder shares, upon our liquidation if we are unable to consummate our initial business combination. Accordingly, the founder
shares and the private placement units will be worthless if we do not consummate our initial business combination. Any warrants they hold,
like those held by the public, will also be worthless if we do not consummate our initial 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
an initial business combination. Consequently, our directors’ and officers’ discretion in identifying and selecting a suitable
target business may result in a conflict of interest when determining whether the terms, conditions and timing of a particular initial
business combination are appropriate and in our stockholders’ best interest.
If our initial business combination is not
completed, our officers and directors may not be reimbursed for their out-of-pocket expenses, and our sponsor will not be eligible to
be repaid for loans our sponsor may provide to us, and a conflict of interest may therefore arise in determining whether a particular
initial business combination target is appropriate for our initial business combination.
Our
officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection
with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable initial business
combinations. Reimbursement for such expenses will be paid by us out of loans by our sponsor and interest earned on the trust account.
There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred in connection with activities on our behalf. In
addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate
of our sponsor may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we would
repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans would be repaid only out of funds
held outside the trust account. In the event that our initial business combination does not close, we may use a portion of the working
capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such
loaned amounts. These financial interests of our sponsor, officers and directors may influence their motivation in identifying
and selecting a target initial business combination and completing our initial business combination.
We may engage in our initial business combination
with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors,
representative, or existing holders that may raise potential conflicts of interest.
In light of the involvement of our sponsor, officers,
directors, and representative with other businesses, we may decide to acquire one or more businesses affiliated or competitive with our
sponsor, officers, directors, representative, or their respective affiliates. Our officers and directors also serve as officers and board
members for other entities, including, without limitation, those described under the section of this prospectus entitled “Management
— Conflicts of Interest.” Such entities may compete with us for initial business combination opportunities. Our sponsor,
officers, directors and representative are not currently aware of any specific opportunities for us to complete our initial business combination
with any entities with which they are affiliated, and there have been no preliminary discussions concerning our initial business combination
with any such entity or entities. Although we will not be specifically focusing on, or targeting, any transaction with any affiliated
entities, we would pursue such a transaction if we determined that such affiliated entity met our criteria for our initial business combination
as set forth in the section of this prospectus entitled “Proposed Business — Effecting an initial business combination”
and such transaction was approved by a majority of our independent and disinterested directors. Despite our agreement to obtain an opinion
from an independent investment banking firm or another independent firm that commonly renders valuation opinions regarding the fairness
to our stockholders from a financial point of view of our initial business combination with one or more domestic or international businesses
affiliated with our officers, directors, or sponsor, potential conflicts of interest still may exist and, as a result, the terms of our
initial business combination may not be as advantageous to our public stockholders as they would be absent any conflicts of interest.
Because our officers and directors will
be eligible to share in a portion of any appreciation in founder shares purchased at approximately $0.0087 per share, a conflict of interest
may arise in determining whether a particular initial business combination target is appropriate for our initial business combination.
The members of our management team have invested
in our sponsor by subscribing units issued by our sponsor. These officers and directors will not receive any cash compensation from us
prior to an initial business combination but through their investment in our sponsor will be eligible to share in a portion of any appreciation
in founder shares and private placement units, provided, that, we successfully complete an initial business combination. We believe that
this structure aligns the incentives of these officers and directors with the interests of our stockholders. However, investors should
be aware that, as these officers and directors have paid approximately $0.0087 per share for the interest in the founder shares, this
structure also creates an incentive whereby our officers and directors could potentially make a substantial profit even if we complete
our initial business combination with a target that ultimately declines in value and is not profitable for public investors.
Because our sponsor will lose its entire
initial investment in us if our initial business combination is not consummated, and our officers and directors have significant financial
interests in us, a conflict of interest may arise in determining whether a particular acquisition target is appropriate for our initial
business combination.
On
June 9, 2021, our sponsor purchased 4,312,500 shares for an aggregate purchase price of $25,000. On November 22, 2021, we
effected a 2 for 3 reverse stock split of our common stock, so that our sponsor owns an aggregate of 2,125,000 founder shares, and
A.G.P. owns 750,000 founder shares. Such shares include an aggregate of up to 375,000 shares that are subject to forfeiture to the
extent that the underwriters’ over-allotment option is not exercised in full or in part, so that our initial stockholders will
collectively own 20% of our issued and outstanding shares after this offering. The founder shares will be worthless if we do not
complete our initial business combination. In addition, our sponsor has agreed to purchase an aggregate 361,000 units (or up to
376,000 units depending on the extent to which the underwriters’ over-allotment option is exercised), at $10.00 per unit for a
total purchase price of $3,610,000 (or up to $3,760,000
depending on the extent to which the underwriters’ over-allotment option is exercised), which private placement units
will also be worthless if we do not consummate our initial business combination. Holders of founder shares and private placement
units have agreed (A) to vote any shares owned by them in favor of any proposed initial business combination and (B) not
to redeem any founder shares in connection with a stockholder vote to approve a proposed initial business combination. In addition,
any loans from our sponsor will not be repaid if our initial business combination is not consummated. In addition, we may obtain
loans from our sponsor, affiliates of our sponsor or an officer or director. The personal and financial interests of our officers
and directors may influence their motivation in identifying and selecting a target initial business combination, completing our
initial business combination and influencing the operation of the business following our initial business combination.
We may not be able to maintain control of
a target business after our initial business combination.
We currently anticipate structuring our initial
business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may structure our initial
business combination to acquire less than 100% of the equity interests or assets of a target business, but we will only consummate such
initial business combination if we will become the majority stockholder of the target (or control the target through contractual arrangements
in limited circumstances for regulatory compliance purposes) or are otherwise not required to register as an investment company under
the Investment Company Act or to the extent permitted by law we may acquire interests in a variable interest entity, in which we may have
less than a majority of the voting rights in such entity, but in which we are the primary beneficiary. Even though we may own a majority
interest in the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-initial
business combination company, depending on valuations ascribed to the target and us in the initial 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 acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial
number of new shares, our stockholders immediately prior to such transaction could own less than a majority of our outstanding shares
subsequent to such transaction. In addition, other minority stockholders may subsequently combine their holdings resulting in a single
person or group obtaining a larger share of our stock than we initially acquired. Accordingly, this may make it more likely that we will
not be able to maintain our control of the target business.
Risks Relating to our Securities
We may issue notes or other debt securities,
or otherwise incur substantial debt, to complete our initial business combination, which may adversely affect our financial condition
and thus negatively impact the value of our stockholders’ investment in us.
Although we have no commitments as of the date
of this prospectus to issue any notes or other debt securities, or otherwise to incur debt, we may choose to incur substantial debt to
complete our initial business combination. If we incur any indebtedness without a waiver from the lender of any right, title, interest
or claim of any kind in or to any monies held in the trust account, the incurrence of debt could have a variety of negative effects, including:
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default and foreclosure on our assets if our operating revenues after our initial business combination are insufficient to repay our debt obligations;
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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;
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our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;
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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;
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our inability to pay dividends on our shares of common stock;
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using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our shares of common stock if declared, expenses, capital expenditures, acquisitions and other general corporate purposes;
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limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;
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increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and
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limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt.
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Because our sponsor paid only approximately
$0.0087 per share for the founder shares, certain of our officers and directors could potentially make a substantial profit even if we
acquire a target business that subsequently declines in value.
On June 9, 2021, our sponsor
purchased 4,312,500 of our common shares for an aggregate purchase price of $25,000, which included 1,207,500 representative shares
previously transferred from our sponsor to an affiliate of A.G.P. on June 16, 2021 for $7,000 (up to 157,500 shares of which
were subject to forfeiture to the extent that the underwriters’ over-allotment option is not exercised in full or in part). On
November 22, 2021, we effected a 2 for 3 reverse stock split of our common stock, and A.G.P. sold back to our sponsor 55,000 founder shares for
$478, such that our sponsor owns 2,125,000 founder shares, and A.G.P. owns 750,000 founder shares (of which 277,174 founder shares
and 97,826 founder shares, respectively, that are subject to forfeiture to the extent that the over-allotment option is not
exercised in full or in part so that our initial stockholders will collectively own 20% of our issued and outstanding shares after
this offering), each share having the purchase value of approximately $0.0087 per share. Certain of our officers and directors have
a significant economic interest in our sponsor. As a result, the low acquisition cost of the founder shares creates an economic
incentive whereby our officers and directors could potentially make a substantial profit even if we complete an initial business
combination with a target business that subsequently declines in value and is unprofitable for public investors.
Our
initial stockholders paid an aggregate of $25,000, or approximately $0.0087 per founder share, and, accordingly,
you will experience immediate and substantial dilution from the purchase of our shares of common stock.
The difference between the public offering
price per share (allocating all of the unit purchase price to the shares of common stock included in a unit and none to the warrants
included in a unit) and the pro forma net tangible book value per share after this offering constitutes dilution to you and the other
investors in this offering. Our initial stockholders acquired the founder shares at a nominal price, significantly contributing to this
dilution. Upon closing of this offering, you and the other public stockholders will incur an immediate and substantial dilution of approximately
94.9% or $9.49 per share (the difference between the pro forma net tangible book value per share of $0.51 and the initial offering price
of $10.00 per share immediately upon the closing of this offering), or approximately 95.5% dilution or $9.55 per share (the difference
between the pro forma net tangible book value per share of $0.45 and the initial offering price of $10.00 per share) if the over-allotment
is fully exercised.
The nominal purchase
price paid by our sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the
consummation of our initial business combination.
We are offering our
units at an offering price of $10.00 per unit and the amount in our trust account is initially anticipated to be $10.10 per public share,
implying an initial value of $10.10 per public share. However, prior to this offering, our sponsor paid a nominal aggregate purchase
price of $25,000 for the founder shares, or approximately $0.0087 per share. As a result, the value of your public shares may be significantly
diluted upon the consummation of our initial business combination, when the founder shares are converted into public shares. For example,
the following table shows the dilutive effect of the founder shares on the implied value of the public shares upon the consummation of
our initial business combination, assuming that our equity value at that time is $96,500,000, which is the amount we would have for our
initial business combination in the trust account after payment of $4,500,000 to the underwriters, assuming the underwriters’
over-allotment option is not exercised, no interest is earned on the funds held in the trust account, and no public shares are redeemed
in connection with our initial business combination, and without taking into account any other potential impacts on our valuation at
such time, such as the trading price of our public shares, the initial business combination transaction costs, any equity issued or cash
paid to the target’s sellers or other third parties, or the target’s business itself, including its assets, liabilities,
management and prospects, as well as the value of our public and private placement units. At such valuation, each of our shares of common
stock would have an implied value of $7.50 per share upon consummation of our initial business combination, which would be a 25.7% decrease
as compared to the initial implied value per public share of $10.10 (the price per unit in this offering, assuming no value to the public
warrants).
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Public shares
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10,000,000
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Founder shares
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2,500,000
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Shares underlying the private placement units
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361,000
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Total shares
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12,861,000
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Total funds
in trust available for initial business combination (less the initial business combination marketing fee payable to A.G.P. as described
in “Underwriting - Conflicts of Interest” and held in the trust account)
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$
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96,500,000
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Initial implied value per public share
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$
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10.10
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Implied value per share upon consummation of initial business
combination
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$
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7.50
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The value of
the founder shares following completion of our initial business combination is likely to be substantially higher than the nominal price
paid for them, even if the trading price of our common stock at such time is substantially less than $10.10 per share.
Upon the closing
of this offering, assuming no exercise of the underwriters’ over-allotment option, our sponsor will have invested in us an aggregate
of $3,635,000, comprised of the $25,000 purchase price for the founder shares and the $3,610,000 purchase price for the private placement
units. Assuming a trading price of $10.10 per share upon consummation of our initial business combination, the 2,500,000 founder shares
and 361,000 private placement units would have an aggregate implied value of $28,896,100 Even if the trading price of our common stock
were as low as $1.27 per share, and the warrants constituting the private placement units were worthless, the value of the founder shares
would be equal to our sponsor’s initial investment in us. As a result, our sponsor is likely to be able to recoup its investment
in us and make a substantial profit on that investment, even if our public shares have lost significant value. Accordingly, our officers
and directors, who own interests in our sponsor, may have an economic incentive that differs from that of the public stockholders to
pursue and consummate our initial business combination rather than to liquidate and to return all of the cash in the trust to the public
stockholders, even if that initial business combination were with a riskier or less-established target business. For the foregoing reasons,
you should consider our officers’ and directors’ financial incentives to complete our initial business combination when evaluating
whether to redeem your shares prior to or in connection with our initial business combination.
We may issue additional common stock or
preferred stock to complete our initial business combination or under an employee incentive plan after completion of our initial business
combination. Any such issuances would dilute the interest of our stockholders and likely present other risks.
Our amended and restated certificate of
incorporation will authorize the issuance of up to 50,000,000 shares of common stock, par value $0.0001 per share, and 1,000,000
shares of preferred stock, par value $0.0001 per share. Immediately after this offering, there will be 37,139,000 (assuming, in each
case, that the underwriters have not exercised their over-allotment option) authorized but unissued shares of common stock, which
amount does not take into account the shares of common stock reserved for issuance upon exercise of outstanding
warrants. Immediately after the consummation of this offering, there will be no shares of preferred stock issued and
outstanding.
We may issue a substantial number of additional
shares of common or preferred stock to complete our initial business combination (including pursuant to a specified future issuance) or
under an employee incentive plan after completion of our initial business combination (although our amended and restated certificate of
incorporation will provide that we may not issue securities that can vote with common stockholders on matters related to our pre-initial
business combination activity, on any amendment to certain provisions of our amended and restated certificate of incorporation or on our
initial business combination). However, our amended and restated certificate of incorporation will provide, among other things, that prior
to our initial business combination, we may not issue additional shares of capital stock 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
certificate of incorporation, like all provisions of our amended and restated certificate of incorporation, may be amended with the approval
of our stockholders. However, our officers, directors and director nominees have agreed, pursuant to a written agreement with us, that
they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing
of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we
do not complete our initial business combination within 12 months (or up to 18 months, if extended) from the closing of this offering
or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity,
unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment
at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which
interest shall be net of taxes payable), divided by the number of then-outstanding public shares.
The issuance of additional shares of common or preferred stock:
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may significantly dilute the equity interest of investors in this offering;
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may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded our common stock;
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could cause a change of control if a substantial number of shares of our common stock 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
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may adversely affect prevailing market prices for our units, common stock and/or warrants.
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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 at
a price that approximates the per-share amount in our trust account at such time, which is generally approximately $10.10. The purpose
of such issuances will be to enable us to provide sufficient liquidity to the post-initial 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.
Holders of warrants will not participate
in liquidating distributions if we are unable to complete our initial business combination within the required time period.
If we are unable to complete our initial business
combination within the required time period and we liquidate the funds held in the trust account, the warrants will expire and holders
will not receive any of such proceeds with respect to the warrants. The foregoing may provide a financial incentive to public stockholders
to vote in favor of any proposed initial business combination as each of their warrants would entitle the holder to receive or purchase
additional shares of common stock, resulting in an increase in their overall economic stake in us. If an initial business combination
is not approved, the warrants will expire and will be worthless.
We are registering the offer and sale of
the shares of common stock underlying the public warrants under the Securities Act; however, we cannot assure you that such registration
will be in place when an investor desires to exercise warrants, thus precluding such investor from being able to exercise its warrants
except on a cashless basis and potentially causing such warrants to expire worthless.
Under the terms of the warrant agreement, we have
agreed that as soon as practicable, but in no event later than 20 business days after the closing of our initial business combination,
we will use our commercially reasonable efforts to file, and within 60 business days following our initial business combination to have
declared effective, a registration statement covering the offer and sale of such shares and maintain a current prospectus relating to
the common stock issuable upon exercise of the warrants, until the expiration of the warrants in accordance with the provisions of the
warrant agreement. We cannot assure you that we will be able to do so if, for example, any facts or events arise that represent a fundamental
change in the information set forth in the registration statement or prospectus, the financial statements contained or incorporated by
reference therein are not current or correct or the SEC issues a stop order. If the offer and sale of the shares issuable upon exercise
of the warrants is not registered under the Securities Act, we will be required to permit holders to exercise their warrants on a cashless
basis. However, no warrant will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders
seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities
laws of the state of the exercising holder, or an exemption is available. Notwithstanding the foregoing, if a registration statement covering
the offer and sale of the common stock issuable upon exercise of the warrants is not effective within a specified period following the
consummation of our initial business combination, warrant holders may, until such time as there is an effective registration statement
and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis
pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such exemption is available. If that
exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. Notwithstanding
the above, if our common stock are, at the time of any exercise of a warrant, not listed on a national securities exchange such that they
satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, we may, at our option,
require holders of public warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of
the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and
in the event we do not so elect, we will use our commercially reasonable efforts to register or qualify the shares under applicable blue
sky laws to the extent an exemption is not available. In no event will we be required to net cash settle any warrant, or issue securities
or other compensation in exchange for the warrants in the event that we are unable to register or qualify the shares underlying the warrants
under applicable state securities laws and no exemption is available. If the issuance of the shares upon exercise of the warrants is not
so registered or qualified or exempt from registration or qualification, the holder of such warrant shall not be entitled to exercise
such warrant and such warrant may have no value and expire worthless. In such event, holders who acquired their warrants as part of a
purchase of units will have paid the full unit purchase price solely for the common stock included in the units. If and when the warrants
become redeemable by us, we may not exercise our redemption right if the issuance of shares upon exercise of the warrants is not exempt
from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification.
We will use our commercially reasonable efforts to register or qualify the offer and sale of such shares under the blue sky laws of the
state of residence in those states in which the warrants were offered by us in this offering.
If you exercise your public warrants on
a “cashless basis,” you will receive fewer shares of common stock from such exercise than if you were to exercise such warrants
for cash.
There are circumstances in which the exercise
of the public warrants may be required or permitted to be made on a cashless basis. First, if a registration statement covering the shares
of common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business
combination, warrant holders may, until such time as there is an effective registration statement, exercise warrants on a cashless basis
in accordance with Section 3(a)(9) of the Securities Act or another exemption. Second, if our common stock is at any time of
any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security”
under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants
to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will
not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our commercially
reasonable best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
Third, if we call the public warrants for redemption, our management will have the option to require all holders that wish to exercise
warrants to do so on a cashless basis. In the event of an exercise on a cashless basis, a holder would pay the warrant exercise price
by surrendering the warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product
of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants
and the “fair market value” (as defined in the next sentence) by (y) the fair market value. The “fair market value”
is the average volume weighted average last reported sale price of the common stock for the 10 trading days ending on the third trading
day prior to the date on which the notice of exercise is received by the warrant agent or on which the notice of redemption is sent to
the holders of warrants, as applicable. As a result, you would receive fewer shares of common stock from such exercise than if you were
to exercise such warrants for cash.
An investor will only be able to exercise
a warrant for cash if the issuance of common stock 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 public warrants will be exercisable for cash
and we will not be obligated to issue shares of common stock unless the shares of common stock 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 common 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.
Our management’s ability to require
holders of our warrants to exercise such warrants on a cashless basis may cause holders to receive fewer shares of common stock 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 prospectus have been satisfied, our management will have the option to require
any holder that wishes to exercise their warrant (including any warrants held by our initial stockholders and/or their permitted transferees)
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 shares of common stock received by a holder upon exercise will be less than it would have been had such holder exercised
their warrant for cash. This will have the effect of reducing the potential “upside” of the holder’s investment in our
company.
We may amend the terms of the warrants in
a way that may be adverse to holders with the approval by the holders of a majority of the then-outstanding warrants.
Our
warrants will be issued in registered form under a warrant agreement between American Stock Transfer & Trust Company, LLC, as
warrant agent, and us. Our warrant agreement provides that the terms of the warrants may be amended without the consent of any holder
to cure any ambiguity or correct any defective provision. Our warrant agreement will require the approval by the holders of 65% of the
then-outstanding public warrants in order to make any change that increases the warrant price or shortens the exercise period of the warrant,
or amends the terms of the private placement warrants or working capital warrants. Accordingly, we may amend the terms of the public
warrants in a manner adverse to a holder if holders of a majority 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 a majority of the then-outstanding public warrants is unlimited,
examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, convert the warrants
into cash or stock (at a ratio different than initially provided), shorten the exercise period or decrease the number of shares of our
common stock purchasable upon exercise of a warrant.
Our initial stockholders may purchase public warrants
with the intention of reducing the number of public warrants outstanding, or to vote such warrants on any matters submitted to warrant
holders for approval, including amending the terms of the public warrants in a manner adverse to the interests of the registered holders
of public warrants. While our initial stockholders, our officers, and our directors have no current commitments, plans or intentions to
engage in such transactions and have not formulated any terms or conditions for such transactions, there is no limit on the number of
our public warrants that our initial stockholders may purchase and it is not currently known how many public warrants, if any, our initial
stockholders may hold at the time of our initial business combination or at any other time during which the terms of the public warrants
may be proposed to be amended.
Our warrant agreement will designate the
courts of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum
for certain types of actions and proceedings that may be initiated by holders of our warrants, which could limit the ability of warrant
holders to obtain a favorable judicial forum for disputes with our company.
Our warrant agreement will provide 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, or 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, or an enforcement action,, and (y) having service of proves made upon such warrant holder
in any such enforcement action by service upon such warrantholder’s counsel in the foreign action as agent for such warrantholder.
The
choice-of-forum provision in our warrant agreement may (1) result in increased costs for investors to bring a claim or (2) limit
a warrantholder’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. We note that there is uncertainty as to
whether a court would enforce this provision and that investors cannot waive compliance with the federal securities laws and the rules and
regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits
brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Section 27
of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange
Act or the rules and regulations thereunder.
We have no obligation to net cash settle
the warrants.
In no event will we have any obligation to net
cash settle the warrants. Accordingly, the warrants may expire worthless.
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 our common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations
and the like) for any 20 trading days within a 30 trading-day period commencing once the warrants become exercisable and ending on the
third trading day prior to the date on which we give proper notice of such redemption and provided certain other conditions are met. If
and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon
exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect
such registration or qualification. We will use our commercially reasonable best efforts to register or qualify such shares of common
stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. 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. None of the private placement units will be redeemable by us
so long as they are held by our initial stockholders or their permitted transferees.
Our warrants and founder shares may have
an adverse effect on the market price of our common stock and make it more difficult to effectuate our initial business combination.
We will be issuing warrants to purchase 7,500,000
shares of our common stock (or up to 8,625,000 shares of common stock if the underwriters’ over-allotment option is exercised in
full) as part of the units offered by this prospectus. In addition, simultaneously with the closing of this offering, we will be issuing,
in the private placement, warrants to purchase 270,750 shares of common stock (or up to 282,000 shares of common stock depending on the extent to which the underwriters' over-allotment
option is exercised), as part of the private placement units issued in the
private placement. Each warrant will be exercisable for three-quarters of share of common stock at an exercise price of $11.50. Our initial
stockholders currently own an aggregate of 2,875,000 founder shares, and we will be issuing to our sponsor, in a private placement, 361,000
(or up to 376,000 depending on the extent to which the underwriters’ over-allotment option is exercised) shares of our common stock,
as part of the private placement units issued in the private placement.
To the extent we issue shares of common stock
to effectuate our initial business combination, the potential for the issuance of a substantial number of additional shares of common
stock upon exercise of these warrants and redemption rights could make us a less attractive initial business combination vehicle to a
target business. Any such issuance will increase the number of issued and outstanding shares of our common stock and reduce the value
of the shares of common stock issued to complete our initial business combination. Therefore, our warrants and founder shares may make
it more difficult to effectuate our initial business combination or increase the cost of acquiring the target business.
The private placement units, including the
warrants underlying the private placement units, are identical to the warrants
sold as part of the units in this offering except that, so long as they are held by our initial stockholders or their permitted
transferees, (i) they (including the common stock issuable upon exercise of these warrants) may not, subject to certain limited
exceptions, be transferred, assigned or sold by our initial stockholders or their permitted transferees until 30 days after the
completion of our initial business combination, (ii) they will be entitled to registration rights, and (iii) for so
long as they are held by our initial stockholders, will not be exercisable more than five years from the effective date of the
registration statement of which this prospectus forms a part in accordance with FINRA Rule 5110(g).
Because each unit consists of one share
of common stock and one warrant to purchase three-quarters of a share of common stock, and only a whole warrant may be exercised, the
units may be worth less than units of other blank check companies.
Each unit consists of one share of common
stock and one warrant to purchase three-quarters of a share of common stock. No fractional warrants will be issued upon separation of
the units, and only whole warrants will trade. Accordingly, unless you purchase a multiple of four units, the number of warrants issuable
to you upon separation of the units will be rounded down to the nearest whole number of warrants. This is different from other offerings
similar to ours whose units include one share of common stock and one warrant to purchase one whole share. We have established the components
of the units in this way in order to reduce the dilutive effect of the warrants upon completion of our initial business combination since
the warrants will each be exercisable in the aggregate for three-quarters of the number of shares compared to units that each contain
a warrant to purchase one whole share, thus making us, we believe, a more attractive merger partner for target businesses. Nevertheless,
this unit structure may cause our units to be worth less than if they included a warrant to purchase one whole share.
A provision of our warrant agreement may
make it more difficult for us to consummate our initial business combination.
If:
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we issue additional 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 (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like), 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
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the Market Value is below $9.20 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like),
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then the exercise price of each warrant will be
adjusted such that the effective exercise price per full share will be equal to 115% of the higher of the Market Value and the Newly Issued
Price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the
Market Value and the Newly Issued Price. This may make it more difficult for us to consummate our initial business combination with a
target business.
The grant of registration rights to our
initial stockholders and their permitted transferees may make it more difficult to complete our initial business combination, and the
future exercise of such rights may adversely affect the market price of our common stock.
Pursuant to the letter agreements, our initial
stockholders and their permitted transferees can demand that we register the private placement units and the founder shares held, or to
be held, by them, and may demand that we register such warrants or the common stock issuable upon exercise of such warrants. We will bear
the cost of registering these securities. The registration and availability of such a significant number of securities for trading in
the public market may have an adverse effect on the market price of our common stock. In addition, the existence of the registration rights
may make our initial business combination more costly or difficult to conclude. This is because the stockholders of the target business
may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact on the
market price of our common stock that is expected when the securities owned by our initial stockholders or their respective permitted
transferees are registered.
The ability of our public stockholders to
exercise their redemption rights may not allow us to effectuate the most desirable initial business combination or optimize our capital
structure.
If our initial business combination requires us
to use substantially all of our cash to pay the purchase price, because we will not know how many public stockholders may exercise redemption
rights, we may either need to reserve part of the trust account for possible payment upon such redemption, or we may need to arrange third
party financing to help fund our initial business combination. In the event that the acquisition involves the issuance of our stock as
consideration, we may be required to issue a higher percentage of our stock 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. This may limit
our ability to effectuate the most attractive initial business combination available to us.
In connection with any meeting held to approve
our initial business combination, we will offer each public stockholder the option to vote in favor of the proposed initial business combination
and still seek redemption of its shares.
In connection with any meeting held to approve
our initial business combination, we will offer each public stockholder (but not our initial stockholders, officers or directors) the
right to have their shares of common stock redeemed for cash (subject to the limitations described elsewhere in this prospectus) regardless
of whether such stockholder votes for or against such proposed initial business combination; provided that a stockholder must in fact
vote for or against a proposed initial business combination in order to have their shares of common stock redeemed for cash. This threshold
and the ability to seek redemption while voting in favor of a proposed initial business combination may make it more likely that we will
consummate our initial business combination.
A public stockholder that fails to vote
either in favor of or against a proposed initial business combination will not be able to have their shares converted for cash.
In order for a public stockholder to have their
shares converted for cash in connection with any proposed initial business combination, that public stockholder must vote either in favor
of or against a proposed initial business combination. If a public stockholder fails to vote in favor of or against a proposed initial
business combination, whether that stockholder abstains from the vote or simply does not vote, that stockholder would not be able to have
their shares of common stock so converted for cash in connection with such initial business combination.
We will require public stockholders who
wish to redeem their shares of common stock in connection with a proposed initial business combination or amendment to our amended and
restated certificate of incorporation to comply with specific requirements for redemption that may make it more difficult for them to
exercise their redemption rights prior to the deadline for exercising their rights.
In connection with any stockholder meeting called
to approve a proposed initial business combination, each public stockholder will have the right, regardless of whether he is voting for
or against such proposed initial business combination or does not vote at all, to demand that we convert their shares into a pro rata
share of the trust account as of two business days prior to the consummation of our initial business combination. We may require public
stockholders who wish to convert their shares in connection with a proposed initial 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 initial business combination. In order to obtain a physical
stock certificate, a stockholder’s broker and/or clearing broker, DTC and our transfer agent will need to act to facilitate this
request. It is our understanding that stockholders 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 stock certificate. While we have been advised that it typically takes a short amount of time to deliver
shares through the DWAC System, we cannot assure you of this fact. Accordingly, if it takes longer than we anticipate for stockholders
to deliver their shares, stockholders 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.
Redeeming stockholders may be unable to
sell their securities when they wish to in the event that the proposed initial business combination is not approved.
We will require public stockholders who wish to
redeem their shares of common stock in connection with any proposed initial business combination to comply with the delivery requirements
discussed above for redemption. If such proposed initial business combination is not consummated, we will promptly return such certificates
to the tendering public stockholders. Accordingly, investors who attempted to redeem 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 shares
of common stock may decline during this time and you may not be able to sell your securities when you wish, even while other stockholders
that did not seek redemption 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 initial 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 initial 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 this
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 stockholder approval or engaging in a tender offer in connection with any proposed initial 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
an initial business combination. Any of the foregoing may place us at a competitive disadvantage in successfully negotiating our initial
business combination.
Provisions in our amended and restated certificate
of incorporation and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future
for our common stock and could entrench management.
Our amended and restated certificate of incorporation
will contain provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests.
These provisions include a staggered board of directors and the ability of our board of directors to designate the terms of and issue
new series of preferred shares, which may make the removal of management more difficult and may discourage transactions that otherwise
could involve payment of a premium over prevailing market prices for our securities.
Section 203 of the DGCL affects the ability
of an “interested stockholder” to engage in certain initial business combinations, for a period of three years following the
time that the stockholder becomes an “interested stockholder.” We will elect in our certificate of incorporation not to be
subject to Section 203 of the DGCL. Nevertheless, our certificate of incorporation will contain provisions that have the same effect
as Section 203 of the DGCL, except that it will provide that affiliates of our initial stockholders and their permitted transferees
will not be deemed to be “interested stockholders,” regardless of the percentage of our voting stock owned by them, and will
therefore not be subject to such restrictions. These charter provisions may limit the ability of third parties to acquire control of our
company.
We may be unable to obtain additional
financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel
us to restructure or abandon a particular initial business combination. If we are unable to complete our initial business combination,
our public stockholders may only receive $10.10 per share or even less (whether or not the underwriters’ over-allotment option
is exercised in full) on our redemption, and the warrants will expire worthless.
Although we believe that the net proceeds
of this offering and the private placement will be sufficient to allow us to consummate our initial business combination, because we
have not yet identified any prospective target business we cannot ascertain the capital requirements for any particular transaction or
our costs to operate or locate a transaction. If the net proceeds of this offering prove to be insufficient, either because of the size
of our initial business combination, the depletion of the available net proceeds in search of a target business, the obligation to repurchase
for cash a significant number of shares from stockholders who elect redemption in connection with our initial business combination or
the terms of negotiated transactions to purchase shares in connection with our initial business combination, we may be required to seek
additional financing or to abandon the proposed initial business combination. Financing may not be available on acceptable terms, if
at all. The current economic environment has made it especially difficult for companies to obtain acquisition financing. To the extent
that additional financing proves to be unavailable when needed to consummate our initial business combination, we would be compelled
to either restructure the transaction or abandon that particular initial business combination and seek an alternative target business
candidate. If we are unable to complete our initial business combination, our public stockholders may only receive $10.10 per share or
even less (whether or not the underwriters’ over- allotment option is exercised in full) on our redemption, and the warrants will
expire worthless. In addition, even if we do not need additional financing to consummate our initial business combination, we may require
such financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material
adverse effect on the continued development or growth of the target business. None of our officers, directors or stockholders is required
to provide any financing to us in connection with or after our initial business combination.
Our initial stockholders control a substantial
interest in us and thus may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do
not support.
Upon the closing of this offering, our initial
stockholders will own shares representing approximately 20% of our issued and outstanding shares of common stock (including the shares
of common stock underlying the private placement units and assuming they do not purchase any units in this offering). Neither our initial
stockholders nor, to our knowledge, any of our officers or directors, have any current intention to purchase additional securities, other
than as disclosed in this prospectus. Factors that would be considered in making such additional purchases would include consideration
of the current trading price of our common stock. In addition, as a result of their substantial ownership in our company, our initial
stockholders may exert a substantial influence on other actions requiring a stockholder vote, potentially in a manner that you do not
support, including amendments to our amended and restated certificate of incorporation and approval of major corporate transactions. If
our initial stockholders purchase any units in this offering or any additional shares of common stock in the aftermarket or in privately
negotiated transactions, this would increase their influence over these actions. In addition, our board of directors, whose members were
elected by our initial stockholders, is and will be divided into two classes, each of which will generally serve for a term of two years
with only one class of directors being elected in each year. We may not hold an annual meeting of stockholders to elect new directors
prior to the completion of our initial business combination, in which case all of the current directors will continue in office until
at least the completion of our initial business combination. If there is an annual meeting, only a portion of our board of directors will
be considered for election due to our “staggered” board of directors. Accordingly, our initial stockholders will exert significant
influence over actions requiring a stockholder vote. Please see “Proposed Business — Stockholders May Not Have the
Ability to Approve our initial business combination.”
A.G.P. may have a conflict of interest in
connection with our initial business combination.
We have engaged A.G.P. to assist us in connection
with our initial business combination. We will pay A.G.P. a cash fee of $500,000 for such services at the closing of this offering, together
with an additional marketing fee equal to 4.5% of the total gross proceeds raised in the offering only if we consummate our initial business
combination. The representative shares transferred from our sponsor to A.G.P. and/or its designees for $6,522 will also be worthless
if we do not consummate our initial business combination. These financial interests may result in A.G.P. having a conflict of interest
when providing the services to us in connection with our initial business combination.
The determination of the offering price
of our units and the size of this offering is more arbitrary than the pricing of securities and size of an offering of an operating company
in a particular industry.
Prior to this offering there has been no public
market for any of our securities. The public offering price of the units and the terms of the warrants were negotiated between us and
the underwriters. In determining the size of this offering, management held customary organizational meetings with representatives of
the underwriters, both prior to our inception and thereafter, with respect to the state of capital markets, generally, and the amount
the underwriters believed they reasonably could raise on our behalf. Factors considered in determining the size of this offering, and
the price and terms of the units, including the shares of common stock and warrants underlying the units, include:
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the history and prospects of companies whose principal business is the acquisition of other companies;
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prior offerings of those companies;
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our prospects for acquiring an operating business at attractive values;
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a review of debt to equity ratios in leveraged transactions;
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an assessment of our management and their experience in identifying operating companies;
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general conditions of the securities markets at the time of this offering; and
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other factors as were deemed relevant.
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Although these factors were considered, the determination
of our offering price is more arbitrary than the pricing of securities of an operating company in a particular industry since we have
no historical operations or financial results.
There is currently no market for our securities
and a market for our securities may not develop, which would adversely affect the liquidity and price of our securities.
There is currently no market for our securities.
Stockholders therefore have no access to information about prior market history on which to base their investment decision. Following
this offering, the price of our securities may vary significantly due to one or more potential initial business combinations and general
market or economic conditions. Furthermore, an active trading market for our securities may never develop or, if developed, it may not
be sustained. You may be unable to sell your securities unless a market can be established and sustained.
Once initially listed on Nasdaq, our securities
may not continue to be listed on Nasdaq in the future, which could limit investors’ ability to make transactions in our securities
and subject us to additional trading restrictions.
We anticipate that our securities will be initially
listed on Nasdaq upon consummation of this offering. However, we cannot assure you of this or that our securities will continue to be
listed on Nasdaq in the future. Additionally, in connection with our initial business combination, the Nasdaq stock exchange may 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. If Nasdaq delists our
securities from trading on its exchange, we could face significant material adverse consequences, including:
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a limited availability of market quotations for our securities;
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a reduced liquidity with respect to our securities;
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a determination that our shares of common stock are a “penny stock” that will require brokers trading in our shares of common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our shares of common stock;
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a limited amount of news and analyst coverage for our company; and
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a decreased ability to issue additional securities or obtain additional financing in the future.
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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, that are referred
to as “covered securities.” Because we expect that our units and eventually our common stock and warrants will be listed on
Nasdaq, our units, common stock 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, other than
the State of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten
to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if we were no longer listed on
Nasdaq, our securities would not be covered securities and we would be subject to regulation in each state in which we offer our securities,
including in connection with our initial business combination.
Compliance obligations under the Sarbanes-Oxley
Act of 2002 may make it more difficult for us to effectuate our initial business combination, require substantial financial and management
resources, and increase the time and costs of completing an acquisition.
Section 404 of the Sarbanes-Oxley Act of
2002, or the Sarbanes-Oxley Act, requires that we evaluate and report on our system of internal controls beginning with our Annual Report
on Form 10-K for the year ending December 31, 2022. The fact that we are a blank check company makes compliance with the requirements
of the Sarbanes-Oxley Act particularly burdensome on us as compared to all public companies because a target company with which we seek
to complete our initial business combination may not comply with the provisions of the Sarbanes-Oxley Act regarding adequacy of its 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 stock.
We do not have a specified maximum redemption
threshold. The absence of such a redemption threshold may make it possible for us to complete our initial business combination with which
a substantial majority of our stockholders do not agree.
Our amended and restated certificate of incorporation
will not provide a specified maximum redemption threshold, except that we may only redeem our public shares so long as our net tangible
assets are at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment
of underwriters’ fees and commissions (such that we are not subject to the SEC’s “penny stock” rules) or any greater
net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. As a result,
we may be able to complete our initial business combination even though a substantial majority of our public stockholders do not agree
with the transaction and have redeemed their shares or, if we seek stockholder approval of our initial business combination and do not
conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into privately
negotiated agreements to sell their shares to our sponsor, officers, directors, advisors or any of their respective affiliates. In the
event the aggregate cash consideration we would be required to pay for all shares of common stock that are validly submitted for redemption
plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate
amount of cash available to us, we will not complete our initial business combination or redeem any shares, all shares of common stock
submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate initial business combination.
In order to effectuate our initial business
combination, blank check companies have, in the recent past, amended various provisions of their charters and other governing instruments,
including their warrant agreements. We cannot assure you that we will not seek to amend our amended and restated certificate of incorporation
or governing instruments in a manner that will make it easier for us to complete our initial business combination that our stockholders
may not support.
In order to effectuate our initial business
combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing instruments,
including their warrant agreements. For example, blank check companies have amended the definition of initial business combination, increased
redemption thresholds and extended the time to consummate our initial business combination and, with respect to their warrants, amended
their warrant agreements to require the warrants to be exchanged for cash and/or other securities. Amending our amended and restated
certificate of incorporation will require a vote of holder of 65% of our common stock, and amending our warrant agreement will require
a vote of holders of 65% of the then-outstanding public warrants. In addition, our amended and restated certificate of incorporation
requires us to provide our public stockholders with the opportunity to redeem their public shares for cash if we propose an amendment
to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption
in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business
combination within 12 months (or up to 18 months, if extended) from the closing of this offering or (B) with respect to any other
provision relating to stockholders’ rights or pre-initial business combination activity. To the extent any such amendments would
be deemed to change fundamentally the nature of any securities offered through the registration statement of which this prospectus forms
a part, we would register, or seek an exemption from registration for, the affected securities. We cannot assure you that we will not
seek to amend our charter or governing instruments or extend the time to consummate our initial business combination in order to effectuate
our initial business combination.
The provisions of our amended and restated
certificate of incorporation that relate to our pre-initial business combination activity (and corresponding provisions of the agreement
governing the release of funds from our trust account), including an amendment to permit us to withdraw funds from the trust account such
that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated, may be amended
with the approval of holders of 65% of our common stock, which is a lower amendment threshold than that of some other blank check companies.
It may be easier for us, therefore, to amend our amended and restated certificate of incorporation and the trust agreement to facilitate
the completion of our initial business combination that some of our stockholders may not support.
Our amended and restated certificate of incorporation
will provide that any of its provisions may be amended if approved by holders of 65% of our common stock entitled to vote thereon, and
corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders
of majority of our common stock entitled to vote thereon, subject to applicable provisions of the DGCL or applicable stock exchange rules.
We may not issue additional securities that can vote with common stockholders on matters related to our pre-initial business combination
activity, on any amendment to certain provisions of our amended and restated certificate of incorporation or on our initial business combination.
Our initial stockholders, who will collectively beneficially own up to 20% of our common stock upon the closing of this offering (assuming
they do not purchase any units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation
and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions
of our amended and restated certificate of incorporation that govern our pre-initial business combination behavior more easily than some
other blank check companies, and this may increase our ability to complete our initial business combination with which you do not agree.
Our stockholders may pursue remedies against us for any breach of our amended and restated certificate of incorporation.
Our initial stockholders, officers, and directors
have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate
of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to
18 months, if extended) from the closing of this offering or (ii) with respect to any other provision relating to stockholders’
rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares
of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit
in the trust account, divided by the number of then-outstanding public shares. These agreements are contained in the letter agreements.
Our stockholders are not parties to, or third-party beneficiaries of, this agreement and, as a result, will not have the ability to pursue
remedies against our initial stockholders, officers, or directors for any breach of this agreement. As a result, in the event of a breach,
our stockholders would need to pursue a stockholder derivative action, subject to applicable law.
We are an “emerging growth company”
and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our securities less
attractive to investors.
We are an “emerging growth company,”
as defined in the JOBS Act. We will remain an “emerging growth company” for up to five years. However, if our non-convertible
debt issued within a three-year period exceeds $1.0 billion, or revenues exceeds $1.07 billion, or the market value of our shares of common
stock 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. As an emerging growth company, we are not being required to comply
with the auditor attestation requirements of section 404 of the Sarbanes-Oxley Act, we have reduced disclosure obligations regarding executive
compensation in our periodic reports and proxy statements, and we are exempt from the requirements of holding a nonbinding advisory vote
on executive compensation and stockholder approval of any golden parachute payments not previously approved. Additionally, as an emerging
growth company, we have elected to delay the adoption of new or revised accounting standards that have different effective dates for public
and private companies until those standards apply to private companies. As such, our financial statements may not be comparable to companies
that comply with public company effective dates. We cannot predict if investors will find our shares less attractive because we may rely
on these provisions. If some investors find our shares less attractive as a result, there may be a less active trading market for our
shares and our share price 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,
will not adopt the new or revised standard until the time private companies are required to adopt the new or revised standard. This may
make comparison of our financial statements with another public company that is neither an emerging growth company nor an emerging growth
company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accountant
standards used.
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 September 30, 2021, we had $11,437 in cash
and a working capital deficiency of $275,163, and we have incurred and expect to continue to incur significant costs in pursuit of our
initial business combination. Management’s plans to address this need for capital through this offering are discussed in the section
of this prospectus titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Our
plans to raise capital and to consummate our initial business combination may not 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 prospectus do not include
any adjustments that might result from our inability to consummate this offering or our inability to continue as a going concern.
An investment in this offering may result
in uncertain or adverse U.S. federal income tax consequences.
An investment in this offering may result
in uncertain U.S. federal income tax consequences. For instance, because there are no authorities that directly address instruments similar
to the units we are issuing in this offering, the allocation an investor makes with respect to the purchase price of a unit and between
a share of common stock and one warrant to purchase three-quarters of a share of common stock which is included in each unit could be
challenged by the IRS or the courts. Furthermore, the U.S. federal income tax consequences of a cashless exercise of warrants included
in the units we are issuing in this offering is unclear under current law. It is also unclear whether the redemption rights with respect
to our shares of common stock suspend the running of a U.S. holder’s holding period for purposes of determining whether any gain
or loss realized by such holder on the sale or exchange of common stock is long-term capital gain or loss and for determining whether
any dividend we pay would be considered “qualified dividends” for federal income tax purposes. See the section titled “U.S.
Federal Income Tax Considerations” for a summary of certain material U.S. federal income tax consequences of an investment in our
securities. Prospective investors are urged to consult their tax advisors with respect to these and other tax consequences when purchasing,
holding or disposing of our securities.
Our amended and restated certificate of
incorporation will designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions
and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial
forum for disputes with our company or our company’s directors, officers or other employees.
Our amended and restated certificate of incorporation
will provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware
shall, to the fullest extent permitted by law, be the sole and exclusive forum for any (1) derivative action or proceeding brought
on behalf of our company; (2) action asserting a claim of breach of a fiduciary duty owed by any director, officer, employee, agent,
or stockholder of our company to our company or our stockholders, or any claim for aiding and abetting any such alleged breach; (3) action
asserting a claim arising pursuant to any provision of the DGCL or our amended and restated certificate of incorporation or our bylaws;
or (4) action asserting a claim governed by the internal affairs doctrine except for, as to each of (1) through (4) above,
any claim (a) as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of
the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days
following such determination); (b) that is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery;
or (c) arising under the federal securities laws, including the Securities Act, as to which the Court of Chancery and the federal
district court for the District of Delaware shall concurrently be the sole and exclusive forums. Notwithstanding the foregoing, the inclusion
of such provision in our amended and restated certificate of incorporation will not be deemed to be a waiver by our stockholders of our
obligation to comply with federal securities laws, rules and regulations, and the provisions of this paragraph 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 shall be the sole and exclusive forum. Any person or entity purchasing or otherwise acquiring any interest
in any shares of our capital stock shall be deemed to have notice of and to have consented to the forum provisions in our amended and
restated certificate of incorporation. If any action the subject matter of which is within the scope the forum provisions is filed in
a court other than a court located within the State of Delaware (a “foreign action”) in the name of any stockholder, such
stockholder shall be deemed to have consented to: (x) the personal jurisdiction of the state and federal courts located within the
State of Delaware 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 stockholder in any such enforcement action by service upon such stockholder’s
counsel in the foreign action as agent for such stockholder.
This choice of forum provision may limit a stockholder’s
ability to bring a claim in a judicial forum that it finds favorable for disputes with our company or its directors, officers or other
employees, which may discourage such lawsuits. Alternatively, if a court were to find this provision of our amended and restated certificate
of incorporation 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.
General Risks
If we effect our initial business combination
with a company with operations or opportunities outside of the United States, we would be subject to a variety of additional risks that
may negatively impact our operations.
If we effect our initial business combination
with a company located outside of the United States, 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:
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·
·
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higher costs and difficulties inherent in managing
cross-border business operations and complying with different commercial and legal requirements of overseas markets;
rules and regulations or currency redemption
or corporate withholding taxes on individuals;
|
|
|
·
|
laws governing the manner in which future initial business combinations may be effected;
|
|
|
·
|
exchange listing and/or delisting requirements;
|
|
|
·
|
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;
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|
|
·
|
currency fluctuations and exchange controls;
|
|
|
·
|
challenges in collecting accounts receivable;
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|
·
|
cultural and language differences;
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|
·
|
employment regulations;
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|
·
|
crime, strikes, riots, civil disturbances, terrorist attacks and wars;
|
|
|
·
·
|
deterioration of political relations with the
United States; and
government appropriations of assets.
|
We may not be able to address adequately these
additional risks, and if we are unable to do so, our operations might suffer.
If we effect an initial business combination
with a company located outside of the United States, 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.
If we effect an initial business
combination with a company located outside of the United States, the laws of the country in which such company operates will govern almost
all 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 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.
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, to effect service of process upon our directors
or officers or to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties of our directors
and officers under federal securities laws.
There are costs and difficulties inherent
in managing cross-border business operations.
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 United States) 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.
Social unrest, acts of terrorism, regime
changes, changes in laws and regulations, political upheaval, or policy changes or enactments may occur in a country in which we may operate
after we effect our initial business combination.
Political events in another country may significantly
affect our business, assets or operations. Social unrest, acts of terrorism, regime changes, changes in laws and regulations, political
upheaval, and policy changes or enactments could negatively impact our business in a particular country.
Many countries have difficult and unpredictable
legal systems and underdeveloped laws and regulations that are unclear and subject to corruption and inexperience.
Our ability to seek and enforce legal protections,
including with respect to intellectual property and other property rights, or to defend ourselves with regard to legal actions taken against
us in a given country, may be difficult or impossible, which could adversely impact our operations, assets or financial condition.
Rules and regulations in many countries are
often ambiguous or open to differing interpretation by responsible individuals and agencies at the municipal, state, regional and federal
levels. The attitudes and actions of such individuals and agencies are often difficult to predict and inconsistent.
Delay with respect to the enforcement of particular
rules and regulations, including those relating to customs, tax, environmental and labor, could cause serious disruption to operations
abroad and negatively impact our results.
If relations between the United States and
foreign governments deteriorate, it could cause potential target businesses or their goods and services to become less attractive.
The relationship between the United States and
foreign governments could be subject to sudden fluctuation and periodic tension. For instance, the United States may announce its intention
to impose quotas on certain imports. Such import quotas may adversely affect political relations between the two countries and result
in retaliatory countermeasures by the foreign government in industries that may affect our ultimate target business. Changes in political
conditions in foreign countries and changes in the state of U.S. relations with such countries are difficult to predict and could adversely
affect our operations or cause potential target businesses or their goods and services to become less attractive. Because we are not limited
to any specific industry, there is no basis for investors in this offering to evaluate the possible extent of any impact on our ultimate
operations if relations are strained between the United States and a foreign country in which we acquire a target business or move our
principal manufacturing or service operations.
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.
Following our initial business combination, our
management may resign from their positions as our officers or directors, and the management of the target business at the time of the
initial business combination will 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.
Currency policies may cause a target business’
ability to succeed in the international markets to be diminished.
In the event we acquire a non-U.S. target, all
revenues and income would likely be received in a foreign currency, the dollar equivalent of our net assets and distributions, if any,
could be adversely affected by reductions in the value of the local currency. The value of the currencies in regions in which potential
targets are located may fluctuate and may be affected by, among other things, changes in political and economic conditions. Any change
in the relative value of such currency against our reporting currency may affect the attractiveness of any target business or, following
consummation of our initial business combination, our financial condition and results of operations. Additionally, if a currency appreciates
in value against the dollar prior to the consummation of our initial business combination, the cost of a target business as measured in
dollars will increase, which may make it less likely that we are able to consummate such transaction.
Because foreign law could govern our material
agreements, we may not be able to enforce our rights within such jurisdiction or elsewhere.
Foreign law could govern our material agreements.
The target business may not be able to enforce any of its material agreements or that remedies will be available outside of such foreign
jurisdiction’s legal system. The system of laws and the enforcement of existing laws and contracts in such jurisdiction may not
be as certain in implementation and interpretation as in the United States. The judiciaries in certain foreign countries may be relatively
inexperienced in enforcing corporate and commercial law, leading to a higher than usual degree of uncertainty as to the outcome of any
litigation, any such jurisdictions may not favor outsiders or could be corrupt. As a result, the inability to enforce or obtain a remedy
under any of our future agreements could result in a significant loss of business and business opportunities.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this prospectus,
which reflect our current views with respect to future events and financial performance, and any other statements of a future or forward-looking
nature, constitute “forward-looking statements” for the purpose of the federal securities laws. Our forward-looking statements
include, but are not limited to, statements regarding our or our management’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,”
“will,” “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 prospectus may include, for example, statements
about:
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·
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our ability to complete our initial business combination;
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|
·
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our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination;
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|
·
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our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination, as a result of which they would then receive expense reimbursements;
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|
·
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our potential ability to obtain additional financing to complete our initial business combination;
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|
·
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our pool of prospective target businesses;
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|
|
·
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the ability of our officers and directors to generate a number of potential investment opportunities;
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|
·
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the delisting of our securities from Nasdaq or an inability to have our securities listed on Nasdaq following an initial business combination that would affect the liquidity of our securities;
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|
·
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potential changes in control of us if we acquire one or more target businesses for stock
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|
·
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our expectations regarding the time during which we will be an “emerging growth company” under the JOBS Act;
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|
·
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potential changes in control of us if we acquire one or more target businesses for stock;
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·
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the lack of a market for our securities; or
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|
·
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our financial performance following this offering or following our initial business combination..
|
The forward-looking statements contained in this
prospectus are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future
developments affecting us may not 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” beginning on page 29. 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.
USE OF PROCEEDS
We are offering 10,000,000 units at a price
of $10.00 per unit. We estimate that the net proceeds of this offering, together with the funds we receive from the sale of the private
placement units (a portion of which will be deposited into the trust account such that, at the time of the closing of this offering,
$101,000,000 (or $116,150,000 if the over-allotment option is exercised in full), will be held in the trust account), will be used as
set forth in the following table:
SPAC
Sponsor Return Model
Use
of IPO Proceeds
USE
OF PROCEEDS
|
|
|
Without
Over-
Allotment
Option
|
|
|
Over-Allotment
Option Exercised
|
|
|
Gross proceeds
|
|
|
|
|
|
|
|
|
|
From offering
|
|
$
|
100,000,000
|
|
|
$
|
115,000,000
|
|
|
From sale of private placement units
|
|
$
|
3,610,000
|
|
|
$
|
3,760,000
|
|
|
Total gross proceeds
|
|
$
|
103,610,000
|
|
|
$
|
118,760,000
|
|
|
Offering expenses(1)
|
|
|
|
|
|
|
|
|
|
Non-contingent underwriting
fee (2)
|
|
$
|
500,000
|
|
|
$
|
500,000
|
|
|
Issuer legal fees and
expenses
|
|
$
|
225,000
|
|
|
$
|
225,000
|
|
|
AGP legal fees and expenses
|
|
$
|
150,000
|
|
|
$
|
150,000
|
|
|
Accounting fees &
expenses
|
|
$
|
40,000
|
|
|
$
|
40,000
|
|
|
SEC/FINRA fees &
expenses
|
|
$
|
62,445
|
|
|
$
|
62,445
|
|
|
Nasdaq listing and filing
fees
|
|
$
|
75,000
|
|
|
$
|
75,000
|
|
|
Printing and engraving
expenses
|
|
$
|
35,000
|
|
|
$
|
35,000
|
|
|
Miscellaneous
|
|
$
|
97,555
|
|
|
$
|
97,555
|
|
|
Total offering expenses paid at IPO
|
|
$
|
1,185,000
|
|
|
$
|
1,185,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Net proceeds (does not include any business combination
market fee payable to A.G.P.)(3)
|
|
$
|
102,425,000
|
|
|
$
|
117,575,000
|
|
|
Held in the trust account
|
|
$
|
101,000,000
|
|
|
$
|
116,150,000
|
|
|
% of public offering size held in trust account(4)
|
|
|
101
|
%
|
|
|
101
|
%
|
|
Not held in the trust account(4)
|
|
$
|
1,425,000
|
|
|
$
|
1,425,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Use of Net Proceeds
Not Held in the Trust Account
|
|
|
|
|
|
|
|
|
|
Legal, accounting, due diligence, travel, and other
expenses in connection with any business combination
|
|
$
|
600,000
|
|
|
|
42.10
|
%
|
|
Legal and accounting fees related to regulatory
reporting obligations, including certain regulatory fees and Nasdaq continued listing fees
|
|
$
|
150,000
|
|
|
|
10.53
|
%
|
|
Director and officer liability insurance premiums
|
|
$
|
600,000
|
|
|
|
42.11
|
%
|
|
Working capital to cover miscellaneous expenses
(including franchise taxes net of anticipated interest income)
|
|
$
|
75,000
|
|
|
|
5.26
|
%
|
|
Total
|
|
$
|
1,425,000
|
|
|
|
100.00
|
%
|
|
(1)
|
The offering expenses relate to all expenses associated with the offering. However, a portion of the offering expenses, including the SEC registration fee, the FINRA filing fee, the non-refundable portion of the Nasdaq listing fee and a portion of the legal and audit fees, have already been paid from the funds we received as loans from our insiders described below. Our sponsor has agreed to apply all of the proceeds from the repayment of the notes to it to the pro rata portion of the private placement units our sponsor has committed to purchase.
|
|
(2)
|
No discounts or commissions will be paid with respect to the purchase of the private placement units.
|
|
(3)
|
Does
not include the compensation of $4,500,000 (or $5,175,000 if the underwriters’ over-allotment option is exercised in full)
representing the initial business combination marketing fee payable as described under the section “Underwriting - Conflicts
of Interest” equal to 4.5% of the proceeds from this Offering.
|
|
(4)
|
These expenses are estimates only. Our actual expenditures for some or all of these items may differ from the estimates set forth herein. For example, we may incur greater legal and accounting expenses than our current estimates in connection with negotiating and structuring our initial business combination based upon the level of complexity of that initial business combination. We do not anticipate any change in the categories of our intended use of proceeds.
|
A total of $10.10 per unit (whether or not
the underwriters’ over-allotment option is exercised in full) of the net proceeds from this offering, together with a portion of
the proceeds of the sale of the private placement units in the private placement, will be placed in a trust account in the United States
maintained by American Stock Transfer & Trust Company, LLC acting as trustee and will be invested only in U.S. government treasury
bills, notes and bonds 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 and that invest solely in U.S. Treasuries. Except for all interest income that may be released to us to pay
our tax obligations, and up to $100,000 of such accrued interest to pay dissolution costs and expenses, as discussed below, none of the
funds held in the trust account will be released from the trust account until the earlier of: (i) the consummation of our initial
business combination within 12 months (or up to 18 months, if extended) from the closing of this offering and (ii) a redemption
to public stockholders prior to any voluntary winding-up in the event we do not consummate our initial business combination within the
applicable period.
The net proceeds held in the trust account may
be used as consideration to pay the sellers of a target business with which we ultimately complete our initial business combination. If
our initial business combination is paid for using shares or debt securities, or not all of the funds released from the trust account
are used for payment of the purchase price in connection with our initial business combination, we may apply the cash released from the
trust account that is not applied to the purchase price for general corporate purposes, including for maintenance or expansion of operations
of acquired businesses, the payment of principal or interest due on indebtedness incurred in consummating our initial business combination,
to fund the purchase of other companies or for working capital.
We believe that amounts not held in trust will
be sufficient to pay the costs and expenses to which such proceeds are allocated. This belief is based on the fact that while we may begin
preliminary due diligence of a target business in connection with an indication of interest, we intend to undertake in-depth due diligence,
depending on the circumstances of the relevant prospective acquisition, only after we have negotiated and signed a letter of intent or
other preliminary agreement that addresses the terms of our initial business combination. However, if our estimate of the costs of undertaking
in-depth due diligence and negotiating our initial business combination is less than the actual amount necessary to do so, or the amount
of interest available to use from the trust account is minimal as a result of the current interest rate environment, we may be required
to raise additional capital, the amount, availability and cost of which is currently unascertainable. In this event, we could seek such
additional capital through loans or additional investments from members of our initial stockholders and their affiliates, but no such
persons are under any obligation to advance funds to, or invest in, us.
In no event will we redeem our public shares in
an amount that would cause our net tangible assets to be less than $5,000,001. Furthermore, the redemption threshold may be further limited
by the terms and conditions of our initial business combination. In such case, we would not proceed with the redemption of our public
shares or the initial business combination, and instead may search for an alternate initial business combination.
A public stockholder will be entitled to receive
funds from the trust account only upon the earlier to occur of: (i) our consummation of our initial business combination, and then
only in connection with those shares of common stock that such stockholder properly elected to redeem, subject to the limitations described
herein, (ii) the redemption of our public shares if we are unable to consummate our initial business combination within 12 months
(or up to 18 months, if extended) following the closing of this offering, subject to applicable law, or (iii) if we seek to amend
our amended and restated certificate of incorporation to affect the substance or timing of our obligation to redeem all public shares
if we cannot complete our initial business combination within 12 months (or up to 18 months, if extended) of the closing of this offering
and such amendment is duly approved. In no other circumstances will a public stockholder have any right or interest of any kind to or
in the trust account.
Our initial stockholders have agreed to waive
their redemption rights with respect to any shares they own in connection with the consummation of our initial business combination,
including their founder shares and common stock acquired as part of the private placement units. In addition, our initial stockholders
have agreed to waive their rights to liquidating distributions with respect to its founder shares if we fail to consummate our initial
business combination within 12 months (or up to 18 months, if extended) from the closing of this offering. However, if our initial stockholders
acquire public shares in or after this offering, they will be entitled to receive liquidating distributions with respect to such public
shares if we fail to consummate our initial business combination within the required time period.
DIVIDEND POLICY
We have not paid any cash dividends on our shares
of common stock to date and do not intend to pay cash dividends prior to the completion of our initial business combination. The payment
of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition
subsequent to completion of our initial business combination. The payment of any cash dividends subsequent to our initial business combination
will be within the discretion of our board of directors at such time and subject to the Delaware law. In addition, our board of directors
is not currently contemplating and does not anticipate declaring any share dividends in the foreseeable future, except if we increase
the size of the offering pursuant to Rule 462(b) under the Securities Act, in which case we will effect a share dividend immediately
prior to the consummation of the offering in such amount as to maintain our initial stockholders’ ownership at 20% of the issued
and outstanding shares of common stock upon the consummation of this offering (excluding the representative shares and the private placement
units and underlying securities and assuming the initial stockholders do not purchase units in this offering)). Further, if we incur any
indebtedness in connection with our initial business combination, our ability to declare dividends may be limited by restrictive covenants
we may agree to in connection therewith.
DILUTION
The difference between the public offering price
per share of our common stock, assuming no value is attributed to the warrants included in the units we are offering pursuant to
this prospectus or the private placement units, and the pro forma net tangible book value per share of our common stock after this
offering constitutes the dilution to investors in this offering. Such calculation does not reflect any dilution associated with the sale
and exercise of warrants, including the warrants included in the private placement units, which would cause the actual dilution to our
public stockholders to be higher, particularly where a cashless exercise is utilized. Net tangible book value per share is determined
by dividing our net tangible book value, which is our total tangible assets less total liabilities (including the value of shares of our
common stock that may be redeemed for cash), by the number of shares of outstanding common stock.
At September 30, 2021, our net tangible book
deficit was $275,163, or approximately $(0.10) per common stock. After giving effect to the sale of 10,000,000 shares of common stock
included in the units we are offering by this prospectus (or 11,500,000 shares of common stock if the underwriters’ over-allotment
option is exercised in full), the sale of the private placement units and the deduction of underwriting commissions and estimated expenses
of this offering, our pro forma net tangible book value at September 30, 2021, would have been $1,446,962 or $0.51 per share (or $1,446,962
or $0.45 per share if the underwriters’ over-allotment option is exercised in full), representing an immediate increase in net
tangible book value (as decreased by the value of 10,000,000 shares of our common stock that may be redeemed for cash or 11,500,000 shares
of our common stock if the underwriters’ over-allotment option is exercised in full) of $0.61 per share (or $0.55 per share if
the underwriters’ over-allotment option is exercised in full). Total dilution to public stockholders from this offering will be
$9.49 per share (or $9.55 if the underwriters’ over-allotment option is exercised in full). The following table illustrates the
dilution to our public stockholders on a per-share basis, assuming no value is attributed to the warrants included in the units:
|
|
|
Without
Over-
allotment
|
|
|
With
full
exercise of
Over-
allotment
|
|
|
Public offering
price
|
|
$
|
10.00
|
|
|
$
|
10.00
|
|
|
Net tangible book deficit
before this offering
|
|
|
(0.10)
|
|
|
|
(0.10
|
)
|
|
Increase (decrease)
attributable to public stockholders
|
|
|
0.61
|
|
|
|
0.55
|
|
|
Pro
forma net tangible book value after this offering
|
|
|
0.51
|
|
|
|
0.45
|
|
|
Dilution to
public stockholders
|
|
$
|
9.49
|
|
|
$
|
9.55
|
|
|
Percentage
of dilution to public stockholders
|
|
|
94.9
|
%
|
|
|
95.5
|
%
|
For purposes of presentation, we have reduced
our pro forma net tangible book value after this offering (assuming no exercise of the underwriters’ over-allotment option) by
$101,000,000 because holders of up to 100.0% of our public shares may redeem their shares for a pro rata share of the aggregate amount
then on deposit in the trust account at a per share redemption price equal to the amount in the trust account as set forth in our tender
offer or proxy materials (initially anticipated to be the aggregate amount held in trust two days prior to the commencement of our tender
offer or stockholder meeting, including interest earned on the funds held in the trust account and not previously released to us to pay
our taxes, if any, less up to $100,000 of interest to pay dissolution costs and expenses) divided by the number of the then-outstanding
public shares.
The following table sets forth information with
respect to our initial stockholders and our public stockholders (assuming that the underwriters’ over-allotment option is not exercised):
|
|
|
Shares
Purchased
|
|
|
Total
Consideration
|
|
|
Average
Price
|
|
|
|
|
Number
|
|
|
Percentage
|
|
|
Number
|
|
|
Percentage
|
|
|
Per
Share
|
|
|
Initial
stockholders(1)
|
|
|
2,500,000
|
|
|
|
19.44
|
%
|
|
$
|
25,000
|
|
|
|
0.02
|
%
|
|
$
|
0.001
|
|
|
Public
stockholders
|
|
|
10,000,000
|
|
|
|
77.75
|
%
|
|
$
|
100,000,000
|
|
|
|
96.50
|
%
|
|
$
|
10.00
|
|
|
Private
Placement Units
|
|
|
361,000
|
|
|
|
2.81
|
%
|
|
$
|
3,610,000
|
|
|
|
3.48
|
%
|
|
$
|
10.00
|
|
|
|
|
|
12,861,000
|
|
|
|
100.00
|
%
|
|
$
|
103,635,000
|
|
|
|
100.00
|
%
|
|
|
|
|
|
|
(1)
|
This number excludes an aggregate of up to 375,000 shares of common stock subject to forfeiture if the over-allotment option
is not exercised in full by the underwriters.
|
The pro forma net tangible book value per share
after the offering is calculated as follows:
|
|
|
Without
Over-
|
|
|
With
full
exercise of
Over-
|
|
|
|
|
allotment
|
|
|
allotment
|
|
|
Numerator:
|
|
|
|
|
|
|
|
|
|
Net
tangible book deficit before this offering
|
|
$
|
(275,163
|
)
|
|
$
|
(275,163
|
)
|
|
Net
proceeds from this offering (1)
|
|
$
|
102,425,000
|
|
|
|
117,575,000
|
|
|
Plus:
Offering costs paid in advance, excluded from tangible book value
|
|
$
|
297,125
|
|
|
|
297,125
|
|
|
Less:
Proceeds held in trust subject to redemption(2)
|
|
$
|
(101,000,000
|
)
|
|
|
(116,150,000
|
)
|
|
|
|
$
|
1,446,962
|
|
|
$
|
1,446,962
|
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
Common
stock outstanding prior to this offering
|
|
$
|
2,875,000
|
|
|
|
2,875,000
|
|
|
Common
stock forfeited if over-allotment is not exercised
|
|
$
|
(375,000
|
)
|
|
|
-
|
|
|
Common
stock included in the units offered
|
|
$
|
10,000,000
|
|
|
|
11,500,000
|
|
|
Common
stock included in the private placement units
|
|
|
361,000
|
|
|
|
376,000
|
|
|
Less:
Shares subject to redemption(2)
|
|
$
|
(10,000,000
|
)
|
|
|
(11,500,000
|
)
|
|
|
|
$
|
2,861,000
|
|
|
|
3,251,000
|
|
|
|
(1)
|
Expenses
applied against gross proceeds include offering expenses of $685,000 and underwriting commissions of $500,000 (excluding deferred
underwriting commissions). See “Use of Proceeds.”
|
|
|
(2)
|
If
we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
business combination pursuant to the tender offer rules, our sponsor, directors, executive officers, advisors or any of their affiliates
may purchase public shares or public units in privately negotiated transactions or in the open market either prior to or following
the completion of our initial business combination. In the event of any such purchases of our shares prior to the completion of our
initial business combination, the number of shares of common stock subject to redemption will be reduced by the amount of any such
purchases, increasing the pro forma net tangible book value per share. See “Proposed Business—Effecting Our Initial Business
Combination—Permitted Purchases of Our Securities.”
|
CAPITALIZATION
The following table sets forth our capitalization at September 30,
2021, and as adjusted to give effect to the filing of our amended and restated certificate of incorporation, the sale of our units in
this offering and the private placement, and the application of the estimated net proceeds derived from the sale of such securities:
|
|
|
September
30, 2021
|
|
|
|
|
Actual
|
|
|
As
Adjusted (1)
|
|
|
Note
payable to related parties (2)
|
|
$
|
55,000
|
|
|
$
|
-
|
|
|
|
|
|
Common
stock, $0.0001 par value, 50,000,000 shares authorized; -0- and 10,000,000 shares are subject to possible redemption, actual and
as adjusted, respectively(3)(4)
|
|
$
|
-
|
|
|
|
101,000,000
|
|
|
Stockholders’
Equity:
|
|
|
|
|
|
|
|
|
|
Preferred
stock, $0.0001 par value, 1,000,000 shares authorized; none issued and outstanding, actual and as adjusted
|
|
|
-
|
|
|
|
-
|
|
|
Common
stock, $0.0001 par value, 50,000,000 shares authorized; 2,875,000 and 2,861,000 shares issued and outstanding, actual and as adjusted,
respectively(5)
|
|
$
|
287
|
|
|
|
286
|
|
|
Additional
paid-in capital(6)
|
|
$
|
24,713
|
|
|
|
1,449,714
|
|
|
Accumulated
deficit
|
|
$
|
(3,038
|
)
|
|
|
(3,038
|
)
|
|
Total
stockholders' equity
|
|
$
|
21,962
|
|
|
|
1,446,962
|
|
|
Total
capitalization
|
|
$
|
76,962
|
|
|
$
|
102,446,962
|
|
|
|
(1)
|
Assumes no exercise
of the underwriter’s over-allotment option and the corresponding forfeiture of 375,000
common stock held by our sponsor.
|
|
|
(2)
|
Our sponsor
has agreed to loan us up to $300,000 to be used for a portion of the expenses of this offering.
As of September 30, 2021, there was $55,000 outstanding under the promissory note with our
sponsor.
|
|
|
(3)
|
Upon the completion
of our initial business combination, we will provide our public stockholders with the opportunity
to redeem their public shares for cash at a per share price equal to the aggregate amount
then on deposit in the trust account calculated as of two business days prior to the consummation
of the initial business combination, including interest earned on the funds held in the trust
account and not previously released to us to pay our taxes. While redemptions cannot cause
our net tangible assets to fall below $5,000,001, all shares of common stock are redeemable
and classified as such on the balance sheet until such date that a redemption event takes
place.
|
|
|
(4)
|
All of the 10,000,000
shares of common stock sold as part of the units in the offering contain a redemption feature
which allows for the redemption of such public shares in connection with our liquidation,
if there is a stockholder vote or tender offer in connection with the business combination
and in connection with certain amendments to our amended and restated certificate of incorporation.
In accordance with SEC and its guidance on redeemable equity instruments, which has been
codified in ASC 480-10-S99, redemption provisions not solely within the control of a company
require common stock subject to redemption to be classified outside of permanent equity.
Given that the shares of common stock sold as part of the units in the offering will be issued
with other freestanding instruments (i.e., public warrants/units, the initial carrying value
of common stock classified as temporary equity will be the allocated proceeds determined
in accordance with ASC 470-20. Our common stock is subject to ASC 480-10-S99. If it is probable
that the equity instrument will become redeemable, we have the option to either (i) accrete
changes in the redemption value over the period from the date of issuance (or from the date
that it becomes probable that the instrument will become redeemable, if later) to the earliest
redemption date of the instrument or (ii) recognize changes in the redemption value immediately
as they occur and adjust the carrying amount of the instrument to equal the redemption value
at the end of each reporting period. We have elected to recognize the changes immediately.
|
|
|
(5)
|
Actual share amount
is prior to any forfeiture of founder shares by our sponsor and as adjusted amount assumes
no exercise of the underwriters’ over-allotment option.
|
|
|
(6)
|
The “as adjusted”
additional paid-in capital calculation is adjusted to zero, with the off-setting balance
recorded to accumulated deficit since additional paid-in capital cannot be less than zero.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
We were incorporated on April 28, 2021 as
a Delaware corporation to serve as a vehicle to effect a merger, share exchange, asset acquisition, share purchase, recapitalization,
reorganization or similar initial business combination with one or more target businesses. Our efforts to identify a prospective target
business will not be limited to a particular industry or geographic location. We intend to utilize cash derived from the proceeds of this
offering, the private placement, our securities, debt or a combination of cash, securities and debt, in effecting an initial business
combination. The issuance of additional shares in our initial business combination:
|
|
·
|
may significantly reduce the equity interest of our stockholders;
|
|
|
·
|
may subordinate the rights of holders of common stock if we issue preferred shares with rights senior to those afforded to our shares of common stock;
|
|
|
·
|
will likely cause a change in control if a substantial number of our shares of common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and most likely will also result in the resignation or removal of our present officers and directors; and
|
|
|
·
|
may adversely affect prevailing market prices for our securities.
|
Similarly, if we issue debt securities, it could
result in:
|
|
·
|
default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to pay our debt obligations;
|
|
|
·
|
acceleration of our obligations to repay the indebtedness even if we have made all principal and interest payments when due if the debt security contains covenants that required the maintenance of certain financial ratios or reserves and we breach any such covenant 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 additional financing, if necessary, if the debt security contains covenants restricting our ability to obtain additional financing while such security is outstanding.
|
As indicated in the accompanying financial statements,
at September 30, 2021, we had $11,437 in cash. Further, we expect to continue to incur significant costs in the pursuit of our acquisition
plans. Our plans to raise capital or to consummate our initial business combination may not be successful.
We are an emerging growth company as defined in
the JOBS Act. As an emerging growth company, we have elected to delay the adoption of new or revised accounting standards that have different
effective dates for public and private companies until those standards apply to private companies. As such, our financial statements may
not be comparable to companies that comply with public company effective dates.
Results of Operations and Known Trends or Future
Events
We have neither engaged in any operations nor
generated any revenues to date. Our only activities since inception have been organizational activities and those necessary to prepare
for this offering and the private placement. Following this offering and the private placement, we will not generate any operating revenues
until after completion of our initial business combination. We will generate non-operating income in the form of interest income on cash
and cash equivalents after this offering. There has been no significant change in our financial or trading position and no material adverse
change has occurred since the date of our audited financial statements. After this offering, we expect to incur increased expenses as
a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence
expenses. We expect our expenses to increase substantially after the closing of this offering.
Liquidity and Capital Resources
As indicated in the accompanying financial statements,
as of September 30, 2021, we had $11,437 in cash and a working capital deficiency of $275,163. Further, we have incurred and expect to
continue to incur significant costs in pursuit of our financing and acquisition plans. Management’s plans to address this uncertainty
through this offering are discussed above. Our plans to raise capital or to consummate our initial business combination may not be successful.
These factors, among others, raise substantial doubt about our ability to continue as a going concern.
Our liquidity needs have been satisfied
to date through receipt of $25,000 from the sale of the insider shares and $55,000 of proceeds from the note payable from our
sponsor. We estimate that the net proceeds from (1) the sale of the public units in this offering, after deducting offering
expenses of approximately $1,185,000 (including underwriting discounts and commissions of $500,000) and (2) the sale of the
private placement units for a purchase price of $3,610,000 (or up to $3,760,000 depending on the extend to which the underwriters’
over-allotment option is exercised), will be $102,425,000, or $117,575,000 if the over-allotment option is exercised in full. This
amount does not reflect payment of the $4,500,000 (or $5,175,000 if the over-allotment option is exercised in full) business
combination marketing fee payable to A.G.P upon the closing of a business combination.
We intend to use substantially all of the net
proceeds of this offering, including the funds held in the trust account, to acquire a target business or businesses and to pay our expenses
relating thereto. To the extent that our share capital is used in whole or in part as consideration to consummate our initial business
combination, the remaining proceeds held in the trust account as well as any other net proceeds not expended will be used as working capital
to finance the operations of the target business. Such working capital funds could be used in a variety of ways including continuing or
expanding the target business’ operations, for strategic acquisitions and for marketing, research and development of existing or
new products. Such funds could also be used to repay any operating expenses or finders’ fees that we had incurred prior to the completion
of our initial business combination if the funds available to us outside of the trust account were insufficient to cover such expenses.
We believe that, upon consummation of this
offering, the approximately $1,425,000 of net proceeds of the private placement not held in the trust account, together with the interest
earned on the trust account that is available to us, will be sufficient to allow us to operate for at least the next 12 months (or up
to 18 months, if extended), assuming that an initial business combination is not consummated during that time. Over this time period,
we will be using these funds for identifying and evaluating prospective acquisition candidates, performing business due diligence on
prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing
corporate documents and material agreements of prospective target businesses, selecting the target business to acquire and structuring,
negotiating and consummating the initial business combination. We anticipate that we will incur approximately:
|
|
·
|
$600,000 of expenses for legal, accounting and other third party expenses attendant to the search for target businesses and to the due diligence investigation, structuring and negotiation of our initial business combination;
|
|
|
·
|
$600,000 of expenses for director and officer liability insurance premiums;
|
|
|
|
|
|
|
·
|
$75,000 for working capital to cover miscellaneous expenses (including franchise taxes net of anticipated interest income); and
|
|
|
|
|
|
|
·
|
$150,000 of expenses for legal and accounting fees relating to SEC reporting obligations.
|
If our estimates of the costs of undertaking in-depth
due diligence and negotiating our initial business combination is less than the actual amount necessary to do so, we may have insufficient
funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional financing
either to consummate our initial business combination or because we become obligated to redeem a significant number of our public shares
upon consummation of our initial business combination, in which case we may issue additional securities or incur debt in connection with
such initial business combination. Subject to compliance with applicable securities laws, we would only consummate such financing simultaneously
with the consummation of our initial business combination. Following our initial business combination, if cash on hand is insufficient,
we may need to obtain additional financing in order to meet our obligations.
Controls and Procedures
We are not currently required to certify an effective
system of internal controls as defined by Section 404 of the Sarbanes-Oxley Act. We will be required to comply with the internal
control requirements of the Sarbanes-Oxley Act for the fiscal year ending December 31, 2022. As of the date of this prospectus, we
have not completed an assessment, nor have our auditors tested our systems, of internal controls. We expect to assess the internal controls
of our target business or businesses prior to the completion of our initial business combination and, if necessary, to implement and test
additional controls as we may determine are necessary in order to certify an effective system of internal controls. A target
business may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding the adequacy of internal controls. Target businesses
we may consider for our initial business combination may have internal controls that need improvement in areas such as:
|
·
|
staffing for financial, accounting and external reporting areas, including segregation of duties;
|
|
|
|
|
·
|
reconciliation of accounts;
|
|
|
|
|
·
|
proper recording of expenses and liabilities in the period to which they relate;
|
|
|
|
|
·
|
evidence of internal review and approval of accounting transactions;
|
|
·
|
documentation of processes, assumptions and conclusions underlying significant estimates; and
|
|
|
|
|
·
|
documentation of accounting policies and procedures.
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Because it will take time, management involvement
and perhaps outside resources to determine what internal control improvements are necessary for us to meet regulatory requirements and
market expectations for our operation of a target business, we may incur significant expense in meeting our public reporting responsibilities,
particularly in the areas of designing, enhancing, or remediating internal and disclosure controls. Doing so effectively may also take
longer than we expect, thus increasing our exposure to financial fraud or erroneous financing reporting.
Once our management’s report on internal
controls is complete, we will retain our independent auditors to audit and render an opinion on such report when, or if, required by Section 404.
The independent auditors may identify additional issues concerning a target business’s internal controls while performing their
audit of internal control over financial reporting.
Quantitative and Qualitative Disclosures about
Market Risk
All amounts held in the trust account, will be
invested in United States government treasury bills, bonds or notes having a maturity of 185 days or less, or in money market funds meeting
the applicable conditions under Rule 2a-7 promulgated under the Investment Company Act of 1940 and that invest solely in U.S. treasuries.
Due to the short-term nature of these investments, we believe there will be no associated material exposure to interest rate risk.
Off-Balance Sheet Arrangements; Commitments
and Contractual Obligations; Quarterly Results
As of the date of this prospectus, we did not
have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual
obligations. No unaudited quarterly operating data is included in this prospectus as we have conducted no operations to date.
JOBS Act
On May 5, 2012, the JOBS Act was signed into
law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies.
We will qualify as an “emerging growth company” and under the JOBS Act will be allowed to comply with new or revised accounting
pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or
revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which
adoption of such standards is required for non- emerging growth companies. As such, our financial statements may not be comparable to
companies that comply with public company effective dates.
PROPOSED BUSINESS
Introduction
We are a blank check company recently incorporated
as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization,
or similar initial business combination. Our team of experienced executives, entrepreneurs, and investors has a demonstrated track record
of stakeholder valuation creation across multiple sectors and at different stages of growth.
As discussed further below, we seek to leverage
and capitalize on our collective multi-faceted expertise, investing and operating experience, and broad network of relationships
to source and evaluate potential transactions and create value for our stakeholders. We believe we have a deep and broad network of relationships
and sector expertise to source and evaluate potential transactions, enhancing our ability to position us as a partner of choice with potential
target companies. The extensive investing track record and operational experience of the management team and our board of directors, including
significant public company executive and board experience are expected to enhance our credibility with prospective investors, and will
allow us to be a value-added partner to the management team and stakeholders following our initial business combination. We believe
our extensive M&A and capital markets experience, including SPAC experience, will enable us to successfully execute our initial business
combination transaction. In addition, we believe having Alliance Global Partners as a significant stakeholder in us will serve as a key
competitive advantage given their extensive access to deal flow.
We may pursue our initial business combination
in any business or industry but intend to focus our search on a target business in an industry where we believe the expertise of our management
team and our board of directors will provide us with a competitive advantage in completing a successful initial business combination.
We intend to seek to acquire one or more businesses with an aggregate enterprise value in excess of $500 million, determined in the sole
discretion of our officers and directors according to reasonably acceptable valuation standards and methodologies, although a target entity
with a smaller or larger enterprise value may be considered.
Our Management Team
For a description of our management team, please
see “Summary – Our Management Team”.
Business Strategy
Our objectives are to generate attractive returns
for stockholders and enhance value through (1) completing our initial business combination with a high-quality merger target
at an attractive valuation with favorable terms for our stockholders and (2) enhancing operational performance through our team’s
experience and by leveraging our expertise and the expertise of our network. We expect to favor potential target companies with certain
industry and business characteristics. Key favorable industry characteristics we look for include, but are not limited to, compelling
long-term growth prospects, strong secular tailwinds, and highly fragmented markets ripe for consolidation opportunities. We expect our
target to possess certain business characteristics such as a leading market position, significant recurring revenue with a diversified
customer base, opportunity for operational improvement, and a healthy margin profile with attractive free cash flow characteristics.
As we consider specific sectors of focus, we will
be guided by three key factors. First, our significant industry and operational expertise. Second, the long-term impact of the COVID-19 pandemic
as an accelerant of business practices and industry changes. Finally, targeting merger candidates where conditions allow us to influence
sufficiently the outcome to produce attractive economic rewards for our stockholders and stakeholders. Our target sectors may include,
but are not limited to: infrastructure and environmental services; health, wellness and food sustainability; financial technology and
financial services; enterprise software and SaaS; and leisure and hospitality.
Our selection process will leverage our network
of varied industry, investment bankers, private equity and venture capital, credit fund, and lending community relationships, as well
as our relationships with management teams of public and private companies, restructuring advisers, attorneys and accountants, which we
believe should provide us with a number of high-quality initial business combination opportunities. We intend to deploy a proactive,
thematic sourcing strategy and to focus on companies where we believe the combination of our operating experience, relationships, capital
and capital markets expertise can be catalysts to change a target company and can help accelerate the target’s growth and performance.
Our management team and board of directors
has experience in:
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sourcing, structuring, acquiring and selling businesses;
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operating companies, implementing and executing change-driven strategies, and identifying, monitoring
and recruiting industry-leading talent;
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fostering relationships with sellers, capital providers and target management teams;
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negotiating transactions favorable to investors;
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executing transactions in multiple geographies and under varying economic and financial market conditions;
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improving the strategic, operational, organizational and financial effectiveness of companies;
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accessing capital markets, including financing businesses, and managing or assisting companies transitioning
from private to public ownership;
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acquiring and integrating companies; and
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developing and growing companies, both organically and inorganically and expanding the product range and
geographic footprint of a number of target businesses.
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Competitive Advantages
We believe our competitive strengths include
the following:
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Depth of Team and Access to Resources: We have a dedicated management team with a track record
of executing on transactions, and the resources to source and evaluate a large number of potential transactions.
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Renowned board of directors: We believe that our ability to leverage the experience of our board
of directors, comprising senior operating executives across multiple sectors and industries, will provide us with a distinct advantage
in being able to source, evaluate and consummate an attractive transaction.
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Sourcing Channels and Leading Industry Relationships: We believe our capabilities, reputation,
and deeply varied industry relationships will provide us with a differentiated pipeline of acquisition opportunities that would be difficult
for other participants in the market to replicate.
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SPAC Experience: Certain members of our management and advisor teams have significant SPAC experience
as founders, investors, and advisors in SPAC transactions. We believe their experience in SPAC transactions provide us with a distinct
advantage with respect to understanding the process of sourcing, evaluating and executing on our initial business combination, as well
as positioning us as an attractive partner for prospective target companies compared to first-time SPACs with no such prior experience.
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Execution and Structuring Capability: We believe our management team and board of directors’
combined expertise and reputation will allow us to source and complete a transaction possessing structural attributes that create an attractive
investment thesis. These types of transactions are typically complex and require creativity, industry knowledge and expertise, rigorous
due diligence, and extensive negotiations and documentation. We believe that by focusing our investment activities on these types of transactions,
we can generate investment opportunities that have attractive risk/reward profiles based on their valuations and structural characteristics.
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Public Company Experience: Certain members of our management team and board of directors have extensive
experience as public company executives and/or board members. This experience will serve as a key competitive advantage in selecting companies
that will benefit from going public, positioning us as an attractive partner to management teams of potential target companies, and help
to create long-term value post-closing of our initial business combination.
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Effecting an initial business combination
General
We are not presently engaged in, and we will not
engage in, any operations for an indefinite period of time following this offering. We intend to effectuate our initial business combination
using cash from the proceeds of this offering and the sale of the private placement units in the private placement, our shares, new debt,
or a combination of these, as the consideration to be paid in our initial business combination. We may seek to consummate our initial
business combination with a company or business that may be financially unstable or in its early stages of development or growth (such
as a company that has begun operations but is not yet at the stage of commercial manufacturing and sales), which would subject us to the
numerous risks inherent in such companies and businesses, although we will not be permitted to effectuate our initial business combination
with another blank check company or a similar company with nominal operations.
If our initial business combination is paid for
using shares or debt securities, or not all of the funds released from the trust account are used for payment of the purchase price in
connection with our initial business combination or used for redemptions of purchases of our common stock, we may apply the cash released
to us from the trust account that is not applied to the purchase price and the initial business combination fee payable to A.G.P. for
general corporate purposes, including for maintenance or expansion of operations of acquired businesses, the payment of principal or interest
due on indebtedness incurred in consummating our initial business combination, to fund the purchase of other companies or for working
capital.
We have not identified any acquisition targets.
From the period prior to our formation through the date of this prospectus, there have been no communications, evaluations or discussions
between any of our officers, directors, or our sponsor, and any of their contacts or relationships, regarding a potential initial business
combination. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable acquisition
candidate. Subject to the requirement that our initial business combination must be with one or more target businesses or assets having
an aggregate fair market value of at least 80% of the value of the trust account (excluding the fee payable to A.G.P. upon an initial
business combination as described in “Underwriting - Conflicts of Interest” and taxes payable on the interest earned on the
trust account) at the time of the agreement to enter into such initial business combination, we have virtually unrestricted flexibility
in identifying and selecting one or more prospective target businesses. Accordingly, there is no current basis for investors in this offering
to evaluate the possible merits or risks of the target business with which we may ultimately complete our initial business combination.
Although our management will assess the risks inherent in a particular target business with which we may combine, this assessment may
not result in our identifying all risks that a target business may encounter. Furthermore, some of those risks may be outside of our control,
meaning that we can do nothing to control or reduce the chances that those risks will adversely impact a target business.
We may seek to raise additional funds through
a private offering of debt or equity securities in connection with the consummation of our initial business combination, and we may effectuate
our initial business combination using the proceeds of such offering rather than using the amounts held in the trust account. Subject
to compliance with applicable securities laws, we would consummate such financing only simultaneously with the consummation of our initial
business combination. In the case of our initial business combination funded with assets other than the trust account assets, our tender
offer documents or proxy materials disclosing the initial business combination would disclose the terms of the financing and, only if
required by law or the Nasdaq stock exchange, we would seek stockholder approval of such financing. There are no prohibitions on our ability
to raise funds privately or through loans in connection with our initial business combination. At this time, we are not a party to any
arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise.
Our Acquisition Process
While we have not selected any specific initial
business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly,
with any initial business combination target with respect to our initial business combination with us, we have begun, and will continue
to actively engage in, an extensive research effort to identify a large number of potential targets.
We intend to leverage our resources and network
for efficient outreach to commence immediately after the date of this prospectus. Our effort will be focused on creating proprietary transaction
opportunities. We believe personal relationships built over time are critical not just in generating transaction opportunities, but also
in consummating an initial business combination. In evaluating a prospective target business, we expect to conduct a thorough due diligence
review which will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities,
as well as a review of financial, operational, legal and other information which will be made available to us.
We
are not prohibited from pursuing our initial business combination with a company 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 and disinterested directors, will obtain an opinion from an independent investment banking
firm, or another independent entity that commonly renders valuation opinions, that such initial business combination is fair to our company
from a financial point of view.
Our
initial stockholders, officers, and directors will directly or indirectly own our securities following this offering, and accordingly,
they 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 initial business combination if the retention or resignation of any such officers and directors was included by a target
business as a condition to any agreement with respect to our initial business combination.
Members of our management team or board of directors
may from time to time become aware of potential business opportunities, one or more of which we may desire to pursue, for an initial business
combination, but we have not (nor has anyone on our behalf) engaged in any substantive discussions, directly or indirectly, with any initial
business combination target with respect to an initial business combination transaction with us.
Investment Criteria
We will use the following investment criteria
to screen for and evaluate target businesses although we may pursue opportunities outside of this scope.
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Small/Mid-cap Business: We intend to seek to acquire one or more businesses with an aggregate
enterprise value in excess of $500 million, determined in the sole discretion of our management team according to reasonably acceptable
valuation standards and methodologies, although a target entity with a smaller or larger enterprise value may be considered. Although
we have no commitment as of the date of this offering, we expect to issue a substantial number of additional shares of common
stock or shares of preferred stock, or a combination thereof, to complete an initial business combination. We believe the small- and mid-cap segment
provides the greatest number of opportunities to invest in an attractive target.
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Public Company Ready: We will seek to acquire a company that is well-positioned to be a public
company in terms of scale and size, and a company that public equity market investors will understand and value. While we believe our
public company experience will be a significant asset as a transaction partner to private companies, we intend to avoid companies that
have significant deficiencies in financial reporting or general public company readiness.
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Generates Stable Free Cash-Flow and/or Annual Recurring Revenue: We will seek to acquire a
business that has historically generated, or has the near-term potential to generate, strong and sustainable free cash flow. We also
believe that certain business models such as SaaS businesses, financial technology or enterprise software businesses have sustainable
annual recurring revenue and are platforms that can be used to create attractively valued public companies.
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Would Benefit Distinctly from our Capabilities: We will seek to acquire a business where we can
tangibly improve the operations and create long-term value for our stockholders. In particular, we believe our experience in operating
and improving public companies, as well as serving on public company boards, would be a value-add to the management teams and boards
of potential target companies.
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Is Sourced Through our Proprietary Channels: We believe the strength of our network will allow
us to source differentiated targets, and even in competitive situations, we believe we would be able to leverage our proprietary relationships
and/or insights into potential targets that will create competitive advantages for us.
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Has a Dedicated and Proven Management Team: We will seek to acquire a business with a professional
management team whose interests are aligned with those of our investors. Where necessary, we may also look to complement and enhance the
capabilities of the target business’s management team by recruiting additional talent through our network of contacts.
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These criteria are not intended to be exhaustive.
Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general
guidelines as well as on other considerations, factors and criteria that our management may deem relevant. In the event that we decide
to enter into our initial 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 in our stockholder communications related to our initial business combination,
which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file
with the SEC.
Our Initial Business Combination Process
In evaluating prospective initial business combinations,
we expect to conduct a thorough due diligence review process that may encompass, among other things, a review of historical and projected
financial and operating data, meetings with management and their advisors (if applicable), on-site inspection of facilities and assets,
discussion with customers and suppliers, legal reviews and other reviews as we deem appropriate. We will leverage our operational and
capital allocation experience in order to:
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Assemble a team of industry and financial experts: For each potential transaction, we intend to assemble
a team of industry and financial experts to supplement our management’s efforts to identify and resolve key issues facing the company.
We intend to construct an operating and financial plan which optimizes the potential to grow stockholder value. With extensive experience
investing in both healthy and underperforming businesses, we expect that our management will be able to demonstrate to the target business
and its stakeholders that we have the resources and expertise to lead the combined company through complex and often turbulent market
conditions and provide the strategic and operational direction necessary to grow the business in order to maximize cash flows and improve
the overall strategic prospects for the business;
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Conduct rigorous research and analysis: Performing disciplined, bottom-up fundamental research and analysis
is core to our strategy, and we intend to conduct extensive due diligence to evaluate the impact that a transaction may have on the target
business;
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Acquire the target company at an attractive price relative to our view of its intrinsic value: Combining
rigorous bottom-up analysis as well as input from industry and financial experts, the management team intends to develop its view of the
intrinsic value of the potential initial business combination. In doing so, the management team will evaluate future cash flow potential,
relative industry valuation metrics and precedent transactions to inform its view of intrinsic value, with the intention of creating an
initial business combination at an attractive price relative to such view;
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Implement operating and financial structuring opportunities: We believe our management team has the ability
to structure and execute an initial business combination that will provide the combined business with a capital structure that will support
growth in stockholder value and give the combined company the flexibility needed to grow organically and/or through strategic acquisitions
or divestitures. We intend to also develop and implement strategies and initiatives to improve the business’s operating and financial
performance and create a platform for growth; and
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Seek follow-on strategic acquisitions and divestitures to grow further stockholder value: The management
team intends to analyze the strategic direction of the company and evaluate non-core asset sales to create financial and/or operating
flexibility needed for the company to engage in organic or inorganic growth. Specifically, the management team intends to evaluate opportunities
for industry consolidation in the company’s core lines of business as well as opportunities to integrate with other industry participants
vertically or horizontally.
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Following our initial business combination, we
intend to evaluate opportunities to enhance stockholder value, including developing and implementing corporate strategies and initiatives
to provide financial and operating runway such that the company can improve its profitability and long-term value. In doing so, the management
team anticipates evaluating corporate governance, opportunistically accessing capital markets and other opportunities to enhance liquidity,
identifying acquisition and divestiture opportunities, and properly aligning management and board incentives with growing stockholder
value.
We
are not prohibited from pursuing our initial business combination with a company 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 such initial business combination is fair to our company from a financial
point of view.
We are not prohibited from pursuing our initial
business combination with a company that is affiliated with our sponsor, officers, directors, or representative. In the event we seek
to complete our initial business combination with a company that is affiliated with our sponsor, officers, or directors, we, or a committee
of independent directors, will obtain an opinion from independent investment banking firm or another independent entity that commonly
renders valuation opinions that our initial business combination is fair to our company and our stockholders from a financial point of
view.
Sourcing of Potential Initial Business Combination
Targets
While we do not presently anticipate engaging
the services of professional firms or other individuals that specialize in business acquisitions on any formal basis, 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. We will engage a finder only to the extent our management
determines that the use of a finder may bring opportunities to us that may not otherwise be available to us or if finders approach us
on an unsolicited basis with a potential transaction that our management determines is in our best interest to pursue. Payment of a finder’s
fee is customarily tied to completion of a transaction; in which case any such fee will be paid out of the funds held in the trust account.
In no event, however, will our sponsor or any of our existing officers or directors, or any entity with which they are affiliated, be
paid any finder’s fee, consulting fee or other compensation by the company prior to, or for any services they render in order to
effectuate, the completion of our initial business combination (regardless of the type of transaction).
The time required to select and evaluate a target
business and to structure and complete our initial business combination, and the costs associated with this process, are not currently
ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target
business with which an initial business combination is not ultimately completed will result in our incurring losses and will reduce the
funds we can use to complete another initial business combination. We will not pay any finders or consulting fees to members of our management
team, or any of their respective affiliates, for services rendered to or in connection with our initial business combination.
Fair Market Value of Target Business or Businesses
The target business, businesses, or assets with
which we effect our initial business combination must have a collective fair market value equal to at least 80% of the value of the trust
account (excluding the fee payable to A.G.P. upon an initial business combination as described in “Underwriting - Conflicts of Interest”
and taxes payable on the interest earned on the trust account) at the time of the agreement to enter into such initial business combination.
If we acquire less than 100% of one or more target businesses in our initial business combination, the aggregate fair market value of
the portion or portions we acquire must equal at least 80% of the value of the trust account (excluding the fee payable to A.G.P. upon
an initial business combination as described in “Underwriting - Conflicts of Interest” and taxes payable on the interest earned
on the trust account) at the time of the agreement to enter into such initial business combination. However, we will always acquire at
least a controlling interest in a target business. The fair market value of a portion of a target business or assets will likely be calculated
by multiplying the fair market value of the entire business by the percentage of the target we acquire. We may seek to consummate our
initial business combination with an initial target business or businesses with a collective fair market value in excess of the balance
in the trust account. In order to consummate such our initial business combination, we may issue a significant amount of debt, equity
or other securities to the sellers of such business and/or seek to raise additional funds through a private offering of debt, equity or
other securities. If we issue securities in order to consummate such our initial business combination, our stockholders could end up owning
a minority of the combined company’s voting securities as there is no requirement that our stockholders own a certain percentage
of our company (or, depending on the structure of our initial business combination, an ultimate parent company that may be formed) after
our initial business combination. Because we have no specific initial business combination under consideration, we have not entered into
any such arrangement to issue our debt or equity securities and have no current intention of doing so.
The fair market value of a target business or
businesses or assets will be determined by our board of directors based upon standards generally accepted by the financial community,
such as actual and potential gross margins, the values of comparable businesses, earnings and cash flow, book value, enterprise value
and, where appropriate, upon the advice of appraisers or other professional consultants. Investors will be relying on the business judgment
of our board of directors, which will have significant discretion in choosing the standard used to establish the fair market value of
a particular target business. If our board of directors is not able to independently determine that the target business or assets has
a sufficient fair market value to meet the threshold criterion, we will obtain an opinion from an unaffiliated, independent investment
banking firm or another independent entity that commonly renders valuation opinions on the type of target business we seek to acquire
with respect to the satisfaction of such criterion. Notwithstanding the foregoing, unless we consummate an initial business combination
with an entity that is affiliated with our sponsor, officers, or directors, we are not required to obtain an opinion from an independent
investment banking firm, or another independent entity that commonly renders valuation opinions on the type of target business we seek
to acquire, that the price we are paying is fair to our stockholders.
Lack of Business Diversification
We may seek to effect an initial business combination
with more than one target business, although we expect to complete our initial business combination with just one business. For an indefinite
period of time after consummation of our initial business combination, the prospects for our success may depend entirely on the future
performance of a single business. Unlike other entities that have the resources to complete initial business combinations with multiple
entities in one or several industries, it is probable that we will not have the resources to diversify our operations and mitigate the
risks of being in a single line of business. By consummating our initial business combination with only a single entity, our lack of diversification
may:
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subject us to negative economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact on the particular industry in which we operate after our initial business combination, and
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cause us to depend on the marketing and sale of a single product or limited number of products or services.
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Limited Ability to Evaluate the Target’s Management Team
Although we intend to closely scrutinize the management
of a prospective target business when evaluating the desirability of effecting our initial business combination with that business, our
assessment of the target business’ management may not prove to be correct. The future role of members of our management team, if
any, in the target business cannot presently be stated with any certainty. Consequently, members of our management team may not become
a part of the target’s management team, and the future management may not have the necessary skills, qualifications or abilities
to manage a public company. Further, it is also not certain whether one or more of our directors will remain associated in some capacity
with us following our initial business combination. Moreover, members of our management team may not have significant experience or knowledge
relating to the operations of the particular target business. Our key personnel may not remain in senior management or advisory positions
with the combined company. The determination as to whether any of our key personnel will remain with the combined company will be made
at the time of our initial business combination.
Following our initial business combination, we
may seek to recruit additional managers to supplement the incumbent management of the target business. We may not have the ability to
recruit additional managers, or that additional managers will have the requisite skills, knowledge or experience necessary to enhance
the incumbent management.
Stockholders May Not Have the Ability to Approve our Initial
Business Combination
In connection with any proposed initial business
combination, we will either (1) seek stockholder approval of our initial business combination at a meeting called for such purpose
at which our public stockholders may seek to convert their public shares, regardless of whether they vote for or against the proposed
initial business combination, 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 stockholders with the opportunity to sell their public shares to us by means of a tender offer
(and thereby avoid the need for a stockholder 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. Notwithstanding the foregoing,
our initial stockholders, directors, and officers have agreed, pursuant to the letter agreements with us, not to convert any public shares
held by them into their pro rata share of the aggregate amount then on deposit in the trust account. If we determine to engage
in a tender offer, such tender offer will be structured so that each stockholder may tender any or all of their public shares rather than
some pro rata portion of their shares. The decision as to whether we will seek stockholder approval of a proposed initial business
combination or will allow stockholders to sell their shares to us in a tender offer will be made by us based on a variety of factors such
as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval. If
we so choose and we are legally permitted to do so, we have the flexibility to avoid a stockholder vote and allow our stockholders to
sell their shares pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act that regulate issuer tender offers. In that case,
we will file tender offer documents with the SEC that will contain substantially the same financial and other information about our initial
business combination as is required under the SEC’s proxy rules. We will consummate our initial business combination only if we
have net tangible assets of at least $5,000,001 upon such consummation and, solely if we seek stockholder approval, a majority of the
issued and outstanding shares of common stock voted are voted in favor of the initial 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 our 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, our net
tangible asset threshold may limit our ability to consummate such initial business combination (as we may be required to have a lesser
number of shares converted or sold to us) and may force us to seek third party financing that 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 stockholders may therefore have to wait 12 months (or up to 18 months,
if extended) from the closing of this offering in order to be able to receive a pro rata share of the trust account.
Our initial stockholders and our officers
and directors have agreed (1) to vote any shares of common stock owned by them in favor of any proposed initial business combination;
(2) not to convert any shares of common stock in connection with a stockholder vote to approve a proposed initial business combination;
and (3) not sell any shares of common stock in any tender in connection with a proposed initial business combination. As a result,
in addition to our initial stockholders’ founder shares and the private placement units, we would need only 3,569,501 or 35.7%,
of the 10,000,000 public shares sold in this offering to be voted in favor of our initial business combination (assuming all outstanding
shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised). Our
initial stockholders, directors, and officers, and their permitted transferees will own shares representing approximately 20% of our
outstanding shares of common stock immediately following the completion of this offering. Accordingly, if we seek stockholder approval
of our initial business combination, the agreement by our initial stockholders, directors, and officers to vote in favor of our initial
business combination will increase the likelihood that we will receive the requisite stockholder approval for such initial business combination.
In addition, we have agreed not to enter into a definitive agreement regarding our initial business combination without the prior consent
of our sponsor
None of our officers, directors, initial stockholders
or their affiliates has indicated any intention to purchase units or shares of common stock in this offering or from persons in the open
market or in private transactions. However, if we hold a meeting to approve a proposed initial business combination and a significant
number of stockholders vote, or indicate an intention to vote, against such proposed initial business combination, our officers, directors,
initial stockholders or their affiliates could make such purchases in the open market or in private transactions in order to influence
the vote. Notwithstanding the foregoing, our officers, directors, initial stockholders and their affiliates will not make purchases of
common stock 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 stock.
Permitted Purchases of our Securities
If we seek stockholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
rules, our initial stockholders, directors, officers, advisors or any their respective affiliates may purchase shares or public warrants
in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination.
There is no limit on the number of shares our initial stockholders, directors, officers, advisors or any of their respective affiliates
may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they have no current commitments,
plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions.
In the event our initial stockholders, directors,
officers, advisors or any of their respective affiliates determine to make any such purchases at the time of a stockholder vote relating
to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve such transaction.
If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material
non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange
Act. Such a purchase may include a contractual acknowledgement that such stockholder, although still the record holder of our shares,
is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. We do not currently anticipate that
such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private
transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any
such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported
pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.
None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior to completion
of our initial business combination.
The purpose of any such purchases of shares could
be to vote such shares in favor of our initial business combination and thereby increase the likelihood of obtaining stockholder approval
of our initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum
net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would
otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding
or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination.
Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been
possible. In addition, if such purchases are made, the public “float” of our shares of common stock or warrants may be reduced
and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation,
listing or trading of our securities on a national securities exchange.
Our sponsor, officers, directors, advisors, and/or
any of their respective affiliates anticipate that they may identify the stockholders with whom our sponsor, officers, directors, advisors,
or any of their respective affiliates may pursue privately negotiated purchases by either the stockholders contacting us directly or by
our receipt of redemption requests submitted by stockholders following our mailing of proxy materials in connection with our initial business
combination. To the extent that our sponsor, officers, directors, advisors, or any of their respective affiliates enter into a private
purchase, they would identify and contact only potential selling stockholders who have expressed their election to redeem their shares
for a pro rata share of the trust account or vote against our initial business combination, whether or not such stockholder has already
submitted a proxy with respect to our initial business combination. Such persons would select the stockholders from whom to acquire shares
based on the number of shares available, the negotiated price per share and such other factors as any such person may deem relevant at
the time of purchase. The price per share paid in any such transaction may be different than the amount per share a public stockholder
would receive if it elected to redeem its shares in connection with our initial business combination. Our sponsor, officers, directors,
advisors, and/or any of their respective affiliates will purchase shares only if such purchases comply with Regulation M under
the Exchange Act and the other federal securities laws
Any purchases by our sponsor, officers, directors,
and/or any of their respective affiliates who are affiliated purchasers under Rule 10b-18 under the Exchange Act will
only be made to the extent such purchases are able to be made in compliance with Rule 10b-18, which is a safe harbor from liability
for manipulation under Section 9(a)(2) and Rule 10b-5 of the Exchange Act. Rule 10b-18 has certain technical requirements
that must be complied with in order for the safe harbor to be available to the purchaser. Our sponsor, officers, directors, advisors,
and/or any of their respective affiliates will not make purchases of common stock if the purchases would violate Section 9(a)(2) or
Rule 10b-5 of the Exchange Act. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange
Act to the extent such purchases are subject to such reporting requirements.
Conversion/Tender Rights
At any meeting called to approve our initial business
combination, public stockholders may seek to convert their public shares, regardless of whether they vote for or against the proposed
initial business combination, into their pro rata share of the aggregate amount then on deposit in the trust account, less any
taxes then due but not yet paid. Notwithstanding the foregoing, our initial stockholders, directors, and officers have agreed, pursuant
to the letter agreements with us, not to convert any founder shares or public shares held by them into their pro rata share of
the aggregate amount then on deposit in the trust account. If we hold a meeting to approve our initial business combination, a holder
will always have the ability to vote against a proposed initial business combination and not seek conversion of their shares.
Alternatively, if we engage in a tender offer,
each public stockholder will be provided the opportunity to sell their public shares to us in such tender offer. The tender offer rules require
us to hold the tender offer open for at least 20 business days. Accordingly, this is the minimum amount of time we would need to provide
holders to determine whether they want to sell their public shares to us in the tender offer or remain an investor in our company.
Our initial stockholders will not have conversion
rights with respect to any shares of common stock owned by them, directly or indirectly, whether acquired prior to this offering or purchased
by them in this offering or in the aftermarket.
We may also require public stockholders, whether
they are a record holder or hold their shares in “street name,” to either tender their certificates (if any) to our transfer
agent or to deliver their shares to the transfer agent electronically using Depository Trust Company’s DWAC (Deposit/Withdrawal
At Custodian) System, at the holder’s option, at any time at or prior to the vote on the initial business combination. The proxy
solicitation materials that we will furnish to stockholders in connection with the vote for any proposed initial business combination
will indicate whether we are requiring stockholders to satisfy such delivery requirements. Accordingly, a stockholder would have from
the time our proxy statement is mailed through the vote on the initial business combination to deliver their shares if he wishes to seek
to exercise their conversion rights. Under Delaware law and our bylaws, we are required to provide at least 10 days’ advance notice
of any stockholder meeting, which would be the minimum amount of time a stockholder would have to determine whether to exercise conversion
rights. As a result, if we require public stockholders who wish to convert their shares of common stock into the right to receive a pro
rata portion of the funds in the trust account to comply with the foregoing delivery requirements, holders may not have sufficient
time to receive the notice and deliver their shares for conversion. Accordingly, investors may not be able to exercise their conversion
rights and may be forced to retain our securities when they otherwise would not want to. The conversion rights will include the requirement
that a beneficial holder must identify itself in order to redeem its shares validly.
There is a nominal cost associated with this tendering
process and the act of certificating the shares or delivering them through the DWAC System. The transfer agent will typically charge the
tendering broker $45 and it would be up to the broker whether or not to pass this cost on to the converting 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 stockholders seeking to exercise conversion rights to deliver their shares prior to the consummation of the proposed initial
business combination and the proposed initial business combination is not consummated, this may result in an increased cost to stockholders.
Any request to convert or tender such shares once
made, may be withdrawn at any time up to the vote on the proposed initial business combination or expiration of the tender offer. Furthermore,
if a holder of a public share delivered their certificate in connection with an election of their conversion or tender and subsequently
decides prior to the vote on the initial business combination or the expiration of the tender offer not to elect to exercise such rights,
he may simply request that the transfer agent return the certificate (physically or electronically).
If our initial business combination is not approved
or completed for any reason, then our public stockholders who elected to exercise their conversion or tender 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.
Liquidation of Trust Account if No Initial Business Combination
If we do not complete an initial business
combination within 12 months (or up to 18 months, if extended) from the closing of this offering, 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; and (iii) as promptly as reasonably possible following such redemption, subject to the approval
of our remaining stockholders and our board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above)
to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.
Under the DGCL, stockholders may be held liable
for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion
of our trust account distributed to our public stockholders upon the redemption of 100% of our outstanding public shares (excluding the
founder shares) in the event we do not complete our initial business combination within the required time period may be considered a liquidation
distribution under Delaware law. If the corporation complies with certain procedures set forth in Section 280 of the DGCL intended
to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party
claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional
150-day waiting period before any redemptions are made to stockholders, any liability of stockholders with respect to a redemption is
limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability
of the stockholder would be barred after the third anniversary of the dissolution.
Furthermore, if the pro rata portion of our
trust account distributed to our public stockholders upon the redemption of 100% of our public shares (excluding our founder shares)
in the event we do not complete our initial business combination within the required time period is not considered a liquidation distribution
under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute
of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as
in the case of a liquidation distribution. It is our intention to redeem our public shares as soon as reasonably possible following the
12th month (or up to the 18th month, if extended) from the closing of this offering, but not more than five business days
thereafter, and, therefore, we do not intend to comply with the above procedures. As such, our stockholders could potentially be liable
for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend well beyond
the third anniversary of such date.
Because we will not be complying with Section 280
of the Delaware General Corporation Law, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us
at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us
within the subsequent 10 years. However, because we are a blank check company, rather than an operating company, and our operations will
be limited to seeking to complete our initial business combination, the only likely claims to arise would be from our vendors (such as
lawyers, investment bankers, etc.) or prospective target businesses.
We will seek to have all third parties (including
any vendors or other entities we engage after this offering) and any prospective target businesses enter into valid and enforceable 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. The underwriters
in this offering will execute such a waiver agreement.
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 stockholders. Nevertheless, there is no guarantee that vendors, service providers
and prospective target businesses will execute such agreements. In the event that a potential contracted party was to refuse to execute
such a waiver, we will execute an agreement with that entity only if our management first determines that we would be unable to obtain,
on a reasonable basis, substantially similar services or opportunities from another entity willing to execute such a waiver. Examples
of instances where we may engage a third party that refused to execute a waiver would be the engagement of a third party consultant who
cannot sign such an agreement due to regulatory restrictions, such as our auditors who are unable to sign due to independence requirements,
or whose particular expertise or skills are believed by management to be superior to those of other consultants that would agree to execute
a waiver or a situation in which management does not believe it would be able to find a provider of required services willing to provide
the waiver. There is also no guarantee that, even if they execute such agreements with us, they will not seek recourse against the trust
account. As a result, if we liquidate, the per-share distribution from the trust account could be less than approximately $10.10 due
to claims or potential claims of creditors. We will distribute to all of our public stockholders, in proportion to their respective equity
interests, an aggregate sum equal to the amount then held in the trust account, inclusive of any interest not previously released to
us, (subject to our obligations under Delaware law to provide for claims of creditors as described below).
If
we are unable to consummate our initial business combination and are forced to redeem 100% of our outstanding public shares for a portion
of the funds held in the trust account, we anticipate notifying the trustee of the trust account to begin liquidating such assets promptly
after such date and anticipate it will take no more than 5 business days to effectuate the redemption of our public shares. Our insiders
have waived their rights to participate in any redemption with respect to their insider shares. We expect that all costs and expenses
associated with implementing our plan of dissolution, as well as payments to any creditors, will be paid from amounts remaining out of
the approximately $1,425,000 of proceeds from the sale of the private placement units, which proceeds will be held outside of the trust
account, although we cannot assure you that there will be sufficient funds for such purpose. However, if such proceeds are not sufficient
to cover the costs and expenses associated with implementing our plan of dissolution, to the extent that there is any interest accrued
in the trust account not otherwise used by us to pay taxes on interest income earned on the trust account balance, we may request the
trustee to release to us an additional amount of up to $100,000 of such accrued interest to pay those costs and expenses. Each holder
of public shares will receive a full pro rata portion of the amount then in the trust account, plus any pro rata interest earned on the
funds held in the trust account and not previously released to us or necessary to pay our taxes. The proceeds deposited in the trust account,
however, could become subject to claims of our creditors that are in preference to the claims of public stockholders.
Our public stockholders shall be entitled to receive
funds from the trust account only in the event of our failure to complete our initial business combination in the required time period
or if the stockholders seek to have us convert their respective shares of common stock upon an initial business combination that is actually
completed by us. In no other circumstances shall a stockholder have any right or interest of any kind to or in the trust account.
If we are forced to file a bankruptcy case
or an involuntary bankruptcy case is filed against us that is not dismissed, the proceeds held in the trust account could be subject
to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over
the claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, the per share redemption or conversion
amount received by public stockholders may be less than $10.10.
If, after we distribute the proceeds in the trust
account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not
dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either
a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover
all amounts received by our stockholders. In addition, our board of directors may be viewed as having breached its fiduciary duty to our
creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying public stockholders
from the trust account prior to addressing the claims of creditors. Claims may be brought against us for these reasons.
Our Amended and Restated Certificate of Incorporation
Our amended and restated certificate of incorporation
will contain certain requirements and restrictions relating to this offering that will apply to us until the completion of our initial
business combination. These provisions cannot be amended without the approval of the holders of 65% of our common stock. Our initial stockholders,
who will collectively beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units
in this offering), will participate in any vote to amend our amended and restated certificate of incorporation and will have the discretion
to vote in any manner they choose, subject to the restrictions set forth in this prospectus. Specifically, our amended and restated certificate
of incorporation will provide, among other things, that:
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If we are unable
to complete our initial business combination within 12 months (or up to 18 months, if extended)
from the closing of this offering, 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 subject to lawfully available funds therefor, redeem 100% of the public shares,
at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the
trust account including interest earned on the funds held in the trust account and not previously
released to us to pay our taxes (less up to $100,000 of interest to pay dissolution costs
and expenses), divided by the number of then-outstanding public shares, which redemption
will completely extinguish public stockholders’ rights as stockholders (including the
right to receive further liquidating distributions, if any), subject to applicable law, and
(iii) as promptly as reasonably possible following such redemption, subject to the approval
of our remaining stockholders and our board of directors, dissolve and liquidate, subject
in each case to our obligations under Delaware law to provide for claims of creditors and
the requirements of other applicable law;
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Prior to our initial business combination, we may not issue
additional shares of capital stock that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote
on any initial business combination;
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Although
we do not intend to enter into our initial business combination with a target business that is affiliated with our sponsor, our directors,
or our officers, we are not prohibited from doing so. In the event we enter into such a transaction, we, or a committee of independent
and disinterested directors, will obtain an opinion from an independent investment banking firm, or another independent entity that commonly
renders valuation opinions, that such initial business combination is fair to our company from a financial point of view;
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If a stockholder vote on our initial business combination is
not required by law and we do not decide to hold a stockholder vote for business or other legal reasons, we will offer to redeem our
public shares pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, and will file tender offer documents with the SEC prior
to completing our initial business combination which contain substantially the same financial and other information about our initial
business combination and the redemption rights as is required under Regulation 14A of the Exchange Act; whether or not we maintain our
registration under the our Exchange Act or our listing on Nasdaq, we will provide our public stockholders with the opportunity to redeem
their public shares by one of the two methods listed above;
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So
long as we obtain and maintain a listing for our securities on Nasdaq, Nasdaq rules require that we must complete one or more initial
business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account
(excluding the fee payable to A.G.P. upon an initial business combination as described in “Underwriting - Conflicts of Interest”
and taxes payable on the interest earned on the trust account) at the time of
our signing a definitive agreement in connection with our initial business combination;
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If our stockholders
approve an amendment to our amended and restated certificate of incorporation (i) to
modify the substance or timing of our obligation to offer redemption rights in connection
with any proposed initial business combination or certain amendments to our charter prior
thereto or to redeem 100% of our public shares if we do not complete our initial business
combination within 12 months (or up to 18 months, if extended) from the closing of this offering
or (ii) with respect to any other provision relating to stockholders’ rights or
pre-initial business combination activity, we will provide our public stockholders with the
opportunity to redeem all or a portion of 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 earned on the funds held in the trust account and not previously released
to us to pay our taxes (and up to $100,000 to pay our dissolution costs and expenses), divided
by the number of then-outstanding public shares; and
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We will not effectuate our initial business combination with
another blank check company or a similar company with nominal operations.
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In addition, our amended and restated certificate
of incorporation will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will
be at least $5,000,001 either immediately prior to, or upon consummation of, our initial business combination, after payment of underwriters’
fees and commissions.
Certain Anti-Takeover Provisions of Delaware Law and our Amended
and Restated Certificate of Incorporation and Bylaws
We have opted out of Section 203 of the DGCL.
However, our amended and restated certificate of incorporation contains similar provisions providing that we may not engage in certain
“initial business combinations” with any “interested stockholder” for a three-year period following the time that
the stockholder became an interested stockholder, unless:
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prior to such time, our board of directors approved either the
initial business combination or the transaction that resulted in the stockholder becoming an interested stockholder;
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upon consummation of the transaction that resulted in the stockholder
becoming an interested stockholder, the interested stockholder owned at least 85% of our voting stock outstanding at the time the transaction
commenced (excluding certain shares); or
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on or subsequent to such time, the initial business combination
is approved by the Board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative
vote of at least two-thirds of the outstanding voting stock not owned by the interested stockholders.
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Generally, a “initial business combination”
includes a merger, asset or stock sale to the interested stockholder. Subject to certain exceptions, an “interested stockholder”
is a person who, together with that person’s affiliates and associates, owns, or within the previous three years owned, 15% or more
of our voting stock.
Under some circumstances, this provision will
make it more difficult for a person who is an interested stockholder to effect various initial business combinations with us for a three-year
period.
Our certificate of incorporation will provide
that our initial stockholders and their various affiliates, successors, and transferees will not be deemed to be “interested stockholders”
regardless of the percentage of our voting stock owned by them, and accordingly will not be subject to this provision.
Our authorized but unissued common stock and preferred
stock are available for future issuances without stockholder approval and could be utilized for a variety of corporate purposes, including
future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized by unissued and unreserved
common stock and preferred stock could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest,
tender offer, merger or otherwise.
Exclusive forum for certain lawsuits
Our amended and restated certificate of incorporation
will require, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (a) any derivative
action or proceeding brought on our behalf, (b) any action asserting a claim of breach of a fiduciary duty owed by any current or
former director, officer, employee, agent to us or out stockholders, (c) any action asserting a claim arising pursuant to any provision
of the DGCL, the amended and restated certificate of incorporation or bylaws, or (d) any action asserting a claim governed by the
internal affairs doctrine shall be the Court of Chancery of the State of Delaware (or, if the Court of Chancery of the State of Delaware
lacks jurisdiction over such action or proceeding, then another court of the State of Delaware or, if no court of the State of Delaware
has jurisdiction, then the United States District Court for the District of Delaware). Unless we consent in writing to the selection of
an alternative forum, the federal district courts of the United States of America shall be the exclusive forum for resolution of any complaint
asserting a cause of action arising under the Securities Act. Although we believe this forum provision benefits us by providing increased
consistency in the application of Delaware law in the types of lawsuits to which it applies, a court may determine that this provision
is unenforceable, and to the extent it is enforceable, the provision may have the effect of discouraging lawsuits against our directors
and officers, although our stockholders will not be deemed to have waived our compliance with federal securities laws and the rules and
regulations thereunder. If any action, the subject matter of which is within the scope the forum provisions of our amended and restated
certificate of incorporation, is filed in a court other than a court of the State of Delaware (a “foreign action”) in the
name of any stockholder, such stockholder shall be deemed to have consented to (i) the personal jurisdiction of the state and federal
courts located within the State of Delaware in connection with any action brought in such court to enforce the forum provisions (an “enforcement
action”), and (ii) having service of process made upon such stockholder in any such enforcement action by service upon such
stockholder’s counsel in the foreign action as agent for such stockholder.
Our amended and restated certificate of incorporation
does not purport to require suits brought to enforce a duty or liability created by the Exchange Act to be brought in the Court of Chancery
of the State of Delaware or another court of the State of Delaware. Section 27 of the Exchange Act creates exclusive federal jurisdiction
over all claims brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. Section 22
of the Securities Act creates a concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability
created by the Securities Act or the rules and regulations thereunder. As noted above, our amended and restated certificate of incorporation
will provide that, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States
of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.
Accordingly, there is uncertainty as to whether a court would enforce such provision, and our stockholders will not be deemed to have
waived our compliance with the federal securities laws and the rules and regulations thereunder.
Special meeting of stockholders
Our bylaws provide that special meetings of our
stockholders may be called only by a majority vote of our board of directors, by our Chief Executive Officer or by our Chairperson.
Advance notice requirements for stockholder proposals and director
nominations
Our
bylaws provide that stockholders seeking to bring business before our annual meeting of stockholders, or to nominate candidates for election
as directors at our annual meeting of stockholders, must provide timely notice of their intent in writing. To be timely, a stockholder’s
notice will need to be received by our secretary at our principal executive offices not later than the close of business on the 90th
day nor earlier than the opening of business on the 120th
day prior to the anniversary date of the immediately preceding annual meeting of stockholders; provided, however, that in the event
that the annual meeting is more than 30 days before or more than 60 days after such anniversary date, notice by the stockholder to
be timely must be so delivered not earlier than the opening of business on the 120th day before the meeting and not later than the later
of (x) the opening of business on the 90th day before the meeting or (y) the close of business on the 10th day following the
day on which public announcement of the date of the annual meeting is first made by us. Pursuant
to Rule 14a-8 of the Exchange Act, proposals seeking inclusion in our annual proxy statement must comply with the notice periods
contained therein. Our bylaws also specify certain requirements as to the form and content of a stockholders’ meeting. These provisions
may preclude our stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors
at our annual meeting of stockholders.
Classified Board of Directors
Our board of directors will initially be divided
into two classes, Class I and Class II with members of each class serving staggered three-year terms. Our amended and restated
certificate of incorporation will provide that the authorized number of directors may be changed only by resolution of our board of directors.
Subject to the terms of any preferred stock, any or all of the directors may be removed from office at any time, but only for cause and
only by the affirmative vote of holders of a majority of the voting power of all then-outstanding shares of our capital stock entitled
to vote generally in the election of directors, voting together as a single class. Any vacancy on our board of directors, including a
vacancy resulting from an enlargement of our board of directors, may be filled only by vote of a majority of our directors then in office.
Potential Revisions to Agreements with Insiders
Our initial stockholders, directors, and officers
have entered into the letter agreements with us, pursuant to which they have agreed to do certain things relating to us and our activities
prior to an initial business combination. We could seek to amend the letter agreements without the approval of stockholders, although
we have no intention to do so. In particular:
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Restrictions relating to liquidating the trust account if we failed to consummate an initial business combination in the time-frames specified above could be amended, but only if we allowed all stockholders to redeem their shares in connection with such amendment;
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Restrictions relating to our insiders being required to vote in favor of an initial business combination or against any amendments to our organizational documents could be amended to allow our insiders to vote on a transaction as they wished;
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The requirement of members of the management team to remain our officer or director until the closing of an initial business combination could be amended to allow persons to resign from their positions with us if, for example, the current management team was having difficulty locating a target business and another management team had a potential target business;
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The restrictions on transfer of our securities could be amended to allow transfer to third parties who were not members of our original management team;
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The obligation of our management team to not propose amendments to our organizational documents could be amended to allow them to propose such changes to our stockholders;
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The obligation of insiders to not receive any compensation in connection with an initial business combination could be modified in order to allow them to receive such compensation;
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The requirement to obtain a valuation for any target business affiliated with our insiders, in the event it was too expensive to do so.
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Except as specified above, stockholders would
not be required to be given the opportunity to redeem their shares in connection with such changes. Such changes could result in:
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Our having an extended period of time to consummate an initial business combination (although with less in trust as a certain number of our stockholders would certainly redeem their shares in connection with any such extension);
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Our insiders being able to vote against an initial business combination or in favor of changes to our organizational documents;
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Our operations being controlled by a new management team that our stockholders did not elect to invest with;
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Our insiders receiving compensation in connection with an initial business combination; and
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Our insiders closing a transaction with one of their affiliates without receiving an independent valuation of such business.
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We will not agree to any such changes unless we
believed that such changes were in the best interests of our stockholders (for example, if we believed such a modification were necessary
to complete an initial business combination). Each of our officers and directors have fiduciary obligations to us requiring that they
act in our best interests and the best interests of our stockholders.
Competition
In identifying, evaluating and selecting a target
business for our initial business combination, we may encounter intense competition from other entities having a business objective similar
to ours, including other blank check companies, private equity groups and leveraged buyout funds, and operating businesses seeking strategic
acquisitions.
Many of these entities are well established and
have significant experience identifying and effecting initial business combinations directly or through affiliates. Moreover, many of
these competitors possess greater financial, technical, human and other resources than we do. Our ability to acquire larger target businesses
will be limited by our available financial resources. This inherent limitation gives others an advantage in pursuing the acquisition of
a target business. Furthermore, the requirement that we acquire a target business or businesses having a fair market value equal to at
least 80% of the value of the trust account (excluding the fee payable to A.G.P. upon an initial business combination as described in
“Underwriting - Conflicts of Interest” and taxes payable on the interest earned on the trust account) at the time of the agreement
to enter into the initial business combination, our obligation to pay cash in connection with our public stockholders who exercise their
redemption rights and the number of our outstanding warrants and the future dilution they potentially represent, may not be viewed favorably
by certain target businesses. Any of these factors may place us at a competitive disadvantage in successfully negotiating our initial
business combination.
Facilities
We currently maintain our executive offices at
42 Broadway, 12th Floor, New York, New York 10004. We consider our current office space adequate for our current operations.
Employees
We currently have two executive officers. These
individuals are not obligated to devote any specific number of hours to our matters but they intend to devote as much of their time as
they deem necessary to our affairs until we have completed our initial business combination. The amount of time they will devote in any
time period will vary based on whether a target business has been selected for our initial business combination and the stage of the initial
business combination process. We do not intend to have any full time employees prior to the consummation of our initial business combination.
Periodic Reporting and Audited Financial Statements
We will register our units, shares of common stock,
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 stockholders with audited financial
statements of the prospective target business as part of any proxy solicitation sent to stockholders to assist them in assessing the target
business. In all likelihood, the financial information included in the proxy solicitation materials will need to be prepared in accordance
with U.S. GAAP or IFRS, depending on the circumstances, and the historical financial statements may be required to be audited in accordance
with the standards of the PCAOB. The financial statements may also be required to be prepared in accordance with U.S. GAAP for the Form 8-K
announcing the closing of our initial business combination, which would need to be filed within four business days thereafter. We cannot
assure you that any particular target business identified by us as a potential acquisition candidate will have the necessary financial
information. To the extent that this requirement cannot be met, we may not be able to acquire the proposed target business.
We will be required to comply with the internal
control requirements of the Sarbanes-Oxley Act beginning for the fiscal year ending December 31, 2022. 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.
Prior to the effectiveness of the registration
statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register
our securities under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated
under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the
Exchange Act prior or subsequent to the consummation of our initial business combination.
We are an “emerging growth company,”
as defined in Section 2(a) of the Securities Act, as modified by 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, 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 stockholder 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 until
the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in
which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer,
which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior December 31st,
and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.
References herein to “emerging growth company” shall have the meaning associated with it in the JOBS Act.
Legal Proceedings
There is no material litigation, arbitration or
governmental proceeding currently pending against us or any of our officers or directors in their capacity as such, and we and our officers
and directors have not been subject to any such proceeding in the 12 months preceding the date of this prospectus.
Comparison to Offerings of Blank Check Companies
Subject to Rule 419
The following table compares and contrasts the
terms of our offering and the terms of an offering of blank check companies under Rule 419 promulgated by the SEC assuming that the
gross proceeds, underwriting discounts and underwriting expenses for the Rule 419 offering are the same as this offering and that
the underwriters will not exercise their over-allotment option. None of the terms of a Rule 419 offering will apply to this offering
because we will be listed on a national securities exchange, we will have net tangible assets in excess of $5,000,001 upon the successful
consummation of this offering and will file a Current Report on Form 8-K, including an audited balance sheet demonstrating this fact.
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Terms of the Offering
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Terms Under a Rule 419
Offering
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Escrow of offering
proceeds
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$101,000,000, consisting
of the net offering proceeds, as well as a portion of the proceeds from the sale of the private placement units, which will be deposited
into a trust account in the United States, maintained by American Stock Transfer & Trust Company, LLC, acting as trustee.
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$85,500,000 of the
offering proceeds, representing the gross proceeds of this offering less allowable underwriting commissions, expenses and company
deductions under Rule 419, would be required to be deposited into either an escrow account with an insured depositary institution
or in a separate bank account established by a broker-dealer in which the broker- dealer acts as trustee for persons having the beneficial
interests in the account.
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Investment of net
proceeds
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The $101,000,000 of
the net offering proceeds, as well as a portion of the proceeds from the sale of the private placement units, held in trust will
only be invested in United States government treasury bills, bonds or notes with a maturity of 185 days or less or in money market
funds meeting the applicable conditions under Rule 2a-7 promulgated under the Investment Company Act and that invest solely
in United States government treasuries.
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Proceeds could be invested
only in specified securities such as a money market fund meeting conditions of the Investment Company Act or in securities that are
direct obligations of, or obligations guaranteed as to principal or interest by, the United States.
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Limitation
on fair value or net
assets of target business
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The initial target business that
we acquire must have a fair market value equal to at least 80% of the balance in our trust account (excluding the fee payable to
A.G.P. upon an initial business combination as described in “Underwriting - Conflicts of Interest” and taxes payable
on the interest earned on the trust account) at the time of the execution of a definitive agreement for our initial business combination.
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We would be restricted from acquiring
a target business unless the fair value of such business or net assets to be acquired represent at least 80% of the maximum offering
proceeds.
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Trading of securities issued
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The
units may commence trading on or promptly after the date of this prospectus. The shares of common stock and warrants comprising
the units will begin to trade separately on the 90th day after the date of this prospectus unless A.G.P. informs us of
its decision to allow earlier separate trading (based upon its assessment of the relative strengths of the securities markets and
small capitalization and blank check companies in general, and the trading pattern of, and demand for, our securities in particular),
provided we have filed with the SEC a Current Report on Form 8-K, which includes an audited balance sheet reflecting our receipt
of the proceeds of this offering.
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No trading of the units or the
underlying securities would be permitted until the completion of an initial business combination. During this period, the securities
would be held in the escrow or trust account.
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Exercise of the warrants
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The warrants cannot be exercised
until the completion of an initial business combination and, accordingly, will be exercised only after the trust account has been
terminated and distributed.
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The warrants could be exercised
prior to the completion of an initial business combination, but securities received and cash paid in connection with the exercise
would be deposited in the escrow or trust account.
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Terms of the Offering
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Terms Under a Rule 419
Offering
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Election to remain
an investor
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We
will either (1) give our stockholders the opportunity to vote on the initial business combination or; (2) provide
our public stockholders with the opportunity to sell their public shares to us in a tender offer for cash equal to their pro rata
share of the aggregate amount then on deposit in the trust account, less taxes. If we hold a meeting to approve a proposed initial
business combination, we will send each stockholder a proxy statement containing information required by the SEC. Under our amended
and restated certificate of incorporation, we must provide at least 10 days advance notice of any meeting of stockholders. Accordingly,
this is the minimum amount of time we would need to provide holders to determine whether to exercise their rights to convert their
shares into cash at such a meeting or to remain an investor in our company. Alternatively, if we do not hold a meeting and instead
conduct a tender offer, we will conduct such tender offer in accordance with the tender offer rules of the SEC and file tender
offer documents with the SEC that will contain substantially the same financial and other information about our initial business
combination as we would have included in a proxy statement.
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A
prospectus containing information required by the SEC would be sent to each investor. Each investor would be given the opportunity
to notify us, in writing, within a period of no less than 20 business days and no more than 45 business days from the effective date
of the post-effective amendment, to decide whether he or she elects to remain a stockholder of ours or require the return of their
investment. If we have not received the notification by the end of the 45th business day, funds and interest or dividends,
if any, held in the trust or escrow account would be returned automatically to the stockholder. Unless a sufficient number of investors
elect to remain investors, all of the deposited funds in the escrow account must be returned to all investors and none of the securities
will be issued.
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The tender offer rules require
us to hold the tender offer open for at least 20 business days. Accordingly, this is the minimum amount of time we would need to
provide holders to determine whether they want to sell their shares to us in the tender offer or remain an investor in our company.
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Initial
business combination
deadline
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Pursuant to our amended and restated
certificate of incorporation, if we do not complete our initial business combination within 12 months (or up to 18 months, if extended)
from the consummation of this offering, it will trigger our automatic winding up, dissolution and liquidation.
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If an acquisition has not been
consummated within 12 months (or up to 18 months, if extended) after the effective date of the initial registration statement, funds
held in the trust or escrow account would be returned to investors.
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Interest earned on the funds in
the trust account
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There can be released to us, from time to time, any interest earned on the funds in the trust account that we may need to pay our tax obligations. The remaining interest earned on the funds in the trust account will not be released until the earlier of the completion of an initial business combination and our entry into liquidation upon failure to effect an initial business combination within the allotted time.
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All interest earned on the funds in the trust account will be held in trust for the benefit of public stockholders until the earlier of the completion of an initial business combination and our liquidation upon failure to effect an initial business combination within the allotted time.
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Release of funds
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Except for interest earned on the funds held in the trust account that may be released to us to pay our tax obligations, the proceeds held in the trust account will not be released until the earlier of the completion of an initial business combination (in which case, the proceeds released to us will be net of the funds used to pay converting or tendering stockholders, as the trustee will directly send the appropriate portion of the amount held in trust to the converting or tendering stockholders at the time of the initial business combination) and the liquidation of our trust account upon failure to effect an initial business combination within the allotted time.
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The proceeds held in the escrow account would not be released until the earlier of the completion of an initial business combination or the failure to effect an initial business combination within the allotted time.
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MANAGEMENT
Directors and Executive Officers
Our directors and officers upon the consummation
of this offering will be the following:
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Name
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Age
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Position
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Stephen Christoffersen
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36
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Chief Executive Officer and Director Nominee*
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William Lischak
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64
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Chief Financial Officer and Director
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Ade Okunubi
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38
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Director Nominee*
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Ali Jahangiri
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46
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Director Nominee*
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Robin L. Smith
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56
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Director Nominee*
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Adam K. Stern
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57
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Director Nominee*
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*This individual will occupy the position of director
on the effective date of the registration statement of which this prospectus is a part.
For a description of our management team, please
see “Summary – Our Management Team”.
Executive Compensation
Other than certain fees payable to A.G.P. as described
in “Underwriting - Conflicts of Interest”, no compensation of any kind, including finder’s, consulting, or other similar
fees, will be paid to any of our existing stockholders, including our directors, or any of their respective affiliates, prior to, or for
any services they render in order to effectuate, the consummation of an initial business combination. However, such individuals will be
reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses
and performing due diligence on suitable initial business combinations. There is no limit on the amount of these out-of-pocket expenses
and there will be no review of the reasonableness of the expenses by anyone other than our board of directors and audit committee, which
includes persons who may seek reimbursement, or a court of competent jurisdiction if such reimbursement is challenged.
After our initial business combination, members
of our management team who remain with us may be paid consulting, management or other fees from the combined company with any and all
amounts being fully disclosed to stockholders, to the extent then known, in the proxy solicitation materials furnished to our stockholders.
However, the amount of such compensation may not be known at the time of the stockholder meeting held to consider our initial business
combination, as it will be up to the directors of the post-combination business to determine executive and director compensation. In this
event, such compensation will be publicly disclosed at the time of its determination in a Current Report on Form 8-K or a periodic
report, as required by the SEC.
Director Independence
The Nasdaq requires that a majority of our board
must be composed of “independent directors,” which is defined generally as a person other than an officer or employee of the
company or its subsidiaries or any other individual having a relationship, which, in the opinion of the company’s board of directors
would interfere with the director’s exercise of independent judgment in carrying out the responsibilities of a director.
Upon
the effective date of the registration statement of which this prospectus forms a part, Ade Okunubi, Ali Jahangiri, Robin L. Smith,
and Adam K. Stern will be our independent directors.
Our independent directors will have regularly
scheduled meetings at which only independent directors are present.
Any affiliated transactions will be on terms that
our board believes are no less favorable to us than could be obtained from independent parties. Our board of directors will review and
approve all affiliated transactions with any interested director abstaining from such review and approval.
Audit Committee
Prior to the consummation of this offering, we
will establish an audit committee of our board of directors, which will consist of Ade Okunubi, Robin L. Smith, and Adam K. Stern, each
of whom will be an independent director under the Nasdaq listing standards and under Rule 10-A-3(b)(1) of the Exchange Act.
Ade Okunubi will be the Chairperson of the audit committee. The audit committee’s duties, which are specified in the Audit Committee’s
Charter, include, but are not limited to:
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reviewing and discussing with management and the independent auditor the annual audited financial statements, and recommending to the board whether the audited financial statements should be included in our Form 10-K;
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discussing with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of our financial statements;
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discussing with management major risk assessment and risk management policies;
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monitoring the independence of the independent auditor;
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verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law;
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reviewing and approving all related-party transactions;
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inquiring and discussing with management our compliance with applicable laws and regulations;
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pre-approving all audit services and permitted non-audit services to be performed by our independent auditor, including the fees and terms of the services to be performed;
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appointing or replacing the independent auditor;
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determining the compensation and oversight of the work of the independent auditor (including resolution of disagreements between management and the independent auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work;
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establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls, or reports that raise material issues regarding our financial statements or accounting policies; and
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approving reimbursement of expenses incurred by our management team in identifying potential target businesses.
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Financial Experts on Audit Committee
Pursuant to Nasdaq rules, the audit committee
will at all times be composed exclusively of “independent directors” who are able to read and understand fundamental financial
statements, including a company’s balance sheet, income statement and cash flow statement.
Each
member of the audit committee is financially literate and our board of directors has determined that Ade Okunubi qualifies as an
“audit committee financial expert,” as defined under rules and regulations of the SEC, which generally is any person
who has past employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience
or background that results in the individual’s financial sophistication.
Nominating Committee
Effective
as of the date of this prospectus, we will establish a nominating committee of our board of directors, which will consist of Ade
Okunubi and Ali Jahangiri, each of whom is an independent director under the Nasdaq listing standards. Ali Jahangiri will be the Chairperson
of the nominating committee. The nominating committee is responsible for overseeing the selection of persons to be nominated to serve
on our board of directors. The nominating committee considers persons identified by its members, management, stockholders, investment
bankers and others.
Guidelines for Selecting Director Nominees
The guidelines for selecting nominees, which are
specified in the Nominating Committee Charter, generally provide that persons to be nominated:
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should have demonstrated notable or significant achievements in business, education or public service;
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should possess the requisite intelligence, education and experience to make a significant contribution to our board of directors and bring a range of skills, diverse perspectives and backgrounds to its deliberations; and
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should have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests of the stockholders.
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The nominating committee will consider a number
of qualifications relating to management and leadership experience, background and integrity and professionalism in evaluating a person’s
candidacy for membership on our board of directors. The nominating committee may require certain skills or attributes, such as financial
or accounting experience, to meet specific board needs that arise from time to time and will also consider the overall experience and
makeup of its members to obtain a broad and diverse mix of board members. The nominating committee does not distinguish among nominees
recommended by stockholders and other persons.
Compensation Committee
Effective
as of the date of this prospectus, we will establish a compensation committee of our board of directors, which will consist of Robin
L. Smith and Ali Jahangiri, each of whom is an independent director under the Nasdaq listing standards. Robin L. Smith will be the Chairperson
of the compensation committee. The compensation committee’s duties, which are specified in our Compensation Committee Charter, include,
but are not limited to:
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reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer’s based on such evaluation;
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reviewing and approving the compensation of all of our other executive officers;
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reviewing our executive compensation policies and plans;
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implementing and administering our incentive compensation equity-based remuneration plans;
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assisting management in complying with our proxy statement and annual report disclosure requirements;
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approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our executive officers and employees;
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if required, producing a report on executive compensation to be included in our annual proxy statement; and
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reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.
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Notwithstanding the foregoing, as indicated above,
other than fees payable to A.G.P. as described in “Underwriting - Conflicts of Interest”, no compensation of any kind, including
finders, consulting, or other similar fees, will be paid to any of our initial stockholders, our directors, or any of their respective
affiliates, prior to, or for any services they render in order to effectuate, the consummation of an initial business combination. Accordingly,
it is likely that prior to the consummation of our initial business combination, the compensation committee will only be responsible for
the review and recommendation of any compensation arrangements to be entered into in connection with such initial business combination.
Compensation Committee Interlocks and Insider Participation
None of our officers currently serves, or in the past year has served,
as a member of the compensation committee of any entity that has one or more officers serving on our board of directors.
Code of Ethics
Effective upon consummation of this offering,
we will adopt a code of ethics that applies to all of our executive officers, directors and employees. The code of ethics codifies the
business and ethical principles that govern all aspects of our business.
Internet Website
Our
internet website is www.westernacquisitionventures.com. Copies of our governance guidelines, code of ethics and the charters of
the Audit Committee, nominating committee and compensation committee will be posted on our website and may also be obtained free of charge
by writing to our Secretary, Western Acquisition Ventures Corp. 42 Broadway, 12th Floor, New York, New York 10004.
Conflicts of Interest
Potential investors should be aware of the following
potential conflicts of interest:
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None of our officers and directors is required to commit their full time to our affairs and, accordingly, they may have conflicts of interest in allocating their time among various business activities.
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In the course of their other business activities, our officers and directors may become aware of investment and business opportunities that may be appropriate for presentation to our company as well as the other entities with which they are affiliated. Our management has pre-existing fiduciary duties and contractual obligations and if there is a conflict of interest in determining whether a particular business opportunity should be presented, any pre-existing fiduciary obligation will be presented the opportunity before we are presented with it.
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Our officers and directors may in the future become affiliated with entities, including other blank check companies, engaged in business activities similar to those intended to be conducted by our company.
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The insider shares owned by our officers and directors will be released from escrow only if an initial business combination is successfully completed and subject to certain other limitations. Additionally, our officers and directors will not receive distributions from the trust account with respect to any of their insider shares if we do not complete an initial business combination. In addition, our officers and directors may loan funds to us after this offering and may be owed reimbursement for expenses incurred in connection with certain activities on our behalf that would only be repaid if we complete our initial business combination. For the foregoing reasons, the personal and financial interests of our directors and executive officers may influence their motivation in identifying and selecting a target business, completing an initial business combination in a timely manner and securing the release of their shares.
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In general, officers and directors of a corporation
incorporated under the laws of the State of Delaware are required to present business opportunities to a corporation if:
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the corporation could financially undertake the opportunity;
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the opportunity is within the corporation’s line of business; and
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it would not be fair to the corporation and its stockholders for the opportunity not to be brought to the attention of the corporation.
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Accordingly, as a result of multiple business
affiliations, our officers and directors may have similar legal obligations relating to presenting business opportunities meeting the
above-listed criteria to multiple entities. Furthermore, our amended and restated certificate of incorporation will provide that the
doctrine of corporate opportunity will not apply with respect to any of our officers or directors in circumstances where the application
of the doctrine would conflict with any fiduciary duties or contractual obligations they may have. In order to minimize potential conflicts
of interest that may arise from multiple affiliations, our officers and directors (other than our independent directors) have agreed
to present to us for our consideration, prior to presentation to any other person or entity, any suitable opportunity to acquire a target
business, until the earlier of: (i) our consummation of our initial business combination and (ii) 12 months (or up to 18 months,
if extended) from the date of this prospectus. This agreement is, however, subject to any pre-existing fiduciary and contractual obligations
such officer or director may from time to time have to another entity. Accordingly, if any of them becomes aware of an initial business
combination opportunity that is suitable for an entity to which he or she has pre-existing fiduciary or contractual obligations, he or
she will honor their fiduciary or contractual obligations to present such initial business combination opportunity to such entity, and
only present it to us if such entity rejects the opportunity. We do not believe, however, that the pre-existing fiduciary duties or contractual
obligations of our officers and directors will materially undermine our ability to complete our initial business combination because
in most cases the affiliated companies are closely held entities controlled by the officer or director or the nature of the affiliated
company’s business is such that it is unlikely that a conflict will arise.
The following table summarizes the other relevant
pre-existing fiduciary or contractual obligations of our officers and directors:
|
Name of Individual
|
|
Name of Affiliated Company
|
|
Industry of Affiliated
Company
|
|
Affiliation
|
|
Stephen Christoffersen
|
|
KushCo Holdings
|
|
Consumer Products
|
|
CFO
|
|
|
|
XS Financial
|
|
Financial
|
|
Board Member
|
|
|
|
Range Ventures LLC
|
|
Financial
|
|
Founder & Managing Member
|
|
|
|
|
|
|
|
|
|
William Lischak
|
|
RightsTrade, LLC
|
|
Film and Television Rights Licensing
|
|
CEO
|
|
|
|
|
|
|
|
|
|
Ade Okunubi
|
|
Industrial Battery
|
|
Industrial Battery Distribution and Servicing
|
|
President
|
|
|
|
OKA Holdings
|
|
Investment Fund
|
|
Managing Partner
|
|
|
|
|
|
|
|
|
|
Ali Jahangiri
|
|
Matisse Falcon, Inc.
|
|
Financial
|
|
CEO
|
|
|
|
Hotels, LLC
|
|
Hotel Industry
|
|
CEO
|
|
|
|
JV Group, Inc.
|
|
Real Estate Company
|
|
Founder & President
|
|
|
|
EB5 Bride, Inc.
|
|
EB5 Visa Industry
|
|
Founder & President
|
|
|
|
Loyola Law School –
Board of Overseers
|
|
University
|
|
Board Member
|
|
|
|
CA Film Commission
|
|
Film
|
|
Commissioner
|
|
|
|
Outclick Media (d/b/a
Eb5Investors.com; Opportunity Zone Expo, Uglobal)
|
|
Events & Publications
- Immigration
|
|
Founder & CEO
|
|
|
|
|
|
|
|
|
|
Robin L. Smith
|
|
Caladrius Biosciences, Inc.
|
|
Biotechnology
|
|
Executive Chairman
|
|
|
|
Wellfleet Partners, Inc.
|
|
Financial
|
|
Partner
|
|
|
|
Sorrento Therapeutics
|
|
Biotechnology
|
|
Board Member
|
|
|
|
ServiceSource International, Inc.
|
|
Services
|
|
Board Member
|
|
|
|
Celularity Therapeutics
|
|
Biotechnology
|
|
Board Member
|
|
|
|
Vicinity and Spiritus Therapeutics
|
|
Life Sciences
|
|
Board Member
|
|
|
|
Cura Foundation
|
|
Medical
|
|
Founder, President, Chairman of the Board
|
|
|
|
NYU Langone Medical Center
|
|
Medical
|
|
Board of Overseers
|
|
|
|
Sanford Health
|
|
Medical
|
|
Board of Trustees
|
|
|
|
Alliance for Cell Therapy
|
|
|
|
Board Member
|
|
|
|
|
|
|
|
|
|
Adam K. Stern
|
|
Stern Aegis Ventures
|
|
Financial
|
|
CEO
|
|
|
|
Aegis Capital Corp.
|
|
Financial
|
|
Head of Private Equity Banking
|
|
|
|
DarioHealth Corp.
|
|
Medical
|
|
Director
|
|
|
|
Organovo Holdings, Inc.
|
|
Medical
|
|
Director
|
|
|
|
Aerami Therapeutics, Inc.
|
|
Medical
|
|
Director
|
In connection with the vote required for any initial
business combination, all of our existing stockholders, including all of our officers and directors, have agreed to vote their respective
insider shares in favor of any proposed initial business combination. In addition, they have agreed to waive their respective rights to
participate in any liquidation distribution with respect to those shares of common stock acquired by them prior to this offering. If they
purchase shares of common stock in this offering or in the open market, however, they would be entitled to participate in any liquidation
distribution in respect of such shares but have agreed not to convert such shares (or sell their shares in any tender offer) in connection
with the consummation of our initial business combination or an amendment to our amended and restated certificate of incorporation relating
to pre-initial business combination activity.
All ongoing and future transactions between us,
on the one hand, and any of our officers and directors or their respective affiliates on the other hand, will be on terms believed by
us to be no less favorable to us than are available from unaffiliated third parties. Such transactions will require prior approval by
our audit committee and a majority of our uninterested “independent” directors, or the members of our board who do not have
an interest in the transaction, in either case who had access, at our expense, to our attorneys or independent legal counsel. We will
not enter into any such transaction unless our audit committee and a majority of our disinterested “independent” directors
determine that the terms of such transaction are no less favorable to us than those that would be available to us with respect to such
a transaction from unaffiliated third parties.
To
further minimize conflicts of interest, we have agreed not to consummate our initial business combination with an entity that is affiliated
with any of our officers, directors or sponsor, unless we have obtained (i) an opinion from an independent investment banking firm,
or another independent entity that commonly renders valuation opinions, that the initial business combination is fair to our company from
a financial point of view; and (ii) the approval of a majority of our disinterested and independent directors (if we have any at
that time). Furthermore, other than the initial business combination fee payable to A.G.P. as described in “Underwriting - Conflicts
of Interest”, in no event will any of our initial stockholders, officers, directors, special advisors or their respective affiliates
be paid any finder’s fee, consulting fee or other similar compensation prior to, or for any services they render in order to effectuate,
the consummation of our initial business combination.
PRINCIPAL STOCKHOLDERS
The following table sets forth information regarding
the beneficial ownership of our shares of common stock as of the date of this prospectus and as adjusted to reflect the sale of our shares
of common stock included in the units offered by this prospectus (assuming none of the individuals listed purchase units in this offering),
by:
|
|
·
|
each person known by us to be the beneficial owner of more than 5% of our issued and outstanding shares of common stock;
|
|
|
·
|
each of our officers and directors; and
|
|
|
·
|
all of our officers and directors as a group.
|
Unless otherwise indicated, we believe that all
persons named in the table have sole voting and investment power with respect to all shares of common stock beneficially owned by them.
The following table does not reflect record of beneficial ownership of any shares of common stock issuable upon exercise of the warrants,
as the warrants are not exercisable within 60 days of the date of this prospectus.
The following table presents the number of
shares and percentage of our common stock beneficially owned as of the filing date, before and after this offering, by each person, or
group of persons, known to us who beneficially owns more than 5% of our capital stock, each named executive officer, each of our directors
and all directors and executive officers as a group. The “After-Offering” numbers and percentages presented assume that the
underwriters do not exercise their over-allotment option, that 375,000 founder shares are forfeited, and that there are 12,861,000
of our common stock issued and outstanding after this offering, consisting of (i) 10,000,000 shares of our common stock, (ii) 2,500,000
founder shares which includes 652,174 representative shares, issued and outstanding after this offering and (iii) 361,000 common
shares underlying the private placement units.
|
|
|
Prior
to Offering
|
|
After
Offering
|
|
|
Name
and Address of Beneficial Owner(1)
|
|
Amount
and
Nature of
Beneficial
Ownership(2)
|
|
|
Approximate
Percentage
of
Outstanding
Shares of
Common
Stock
|
|
|
Amount
and
Nature of
Beneficial
Ownership(3)
|
|
|
Approximate
Percentage of
Outstanding
Shares of
Common Stock
|
|
|
Western Acquisition Ventures Sponsor LLC
(our sponsor)
|
|
|
2,125,000
|
|
|
|
85
|
%
|
|
|
1,847,826
|
|
|
|
14
|
%
|
|
A.G.P./Alliance
Global Partners(4)
|
|
|
750,000
|
|
|
|
15
|
%
|
|
|
652,174
|
|
|
|
5
|
%
|
|
Stephen
Christoffersen (Director Nominee)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
William
Lischak (Director)(5)
|
|
|
2,125,000
|
|
|
|
85
|
%
|
|
|
1,847,826
|
|
|
|
15
|
%
|
|
Ade Okunubi (Director Nominee)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Ali Jahangiri (Director Nominee)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Robin L. Smith (Director Nominee)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Adam K. Stern (Director Nominee)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
All
directors, Director Nominees and executive officers as a group (six individuals)
|
|
|
2,125,000
|
|
|
|
85
|
%
|
|
|
1,847,826
|
|
|
|
14
|
%
|
|
|
(1)
|
Unless otherwise indicated, the business address of each of the individuals is c/o 42 Broadway, 12th Floor, New York, New York 10004.
|
|
|
(2)
|
Interests shown consist
solely of founder shares, classified as common stock, of which up to 277,174 shares are subject to forfeiture by our sponsor, and
97,826 shares are subject to forfeiture by A.G.P./Alliance Global Partners depending on the extent to which the underwriters’
over-allotment option is exercised. Such shares are described in the section of this prospectus entitled “Description of Securities”.
|
|
|
|
|
|
|
(3)
|
Interests shown consist of founders shares, classified as common stock, described in the previous footnote.
|
|
|
|
|
|
|
(4)
|
Interests shown consist solely of
representative shares, classified as common stock, of which up to 97,826 shares are subject to forfeiture by A.G.P. depending on the
extent to which the underwriters’ over-allotment option is exercised. Such shares are described in the section of this
prospectus entitled “Description of Securities”. The business address of A.G.P. is 590 Madison Avenue, 28th
Floor, New York, NY 10022. Interests shown consist of 750,000 shares of common stock beneficially owned by A.G.P. Individuals who have shared
voting and investor control over these shares are Raffaele Gambardella, A.G.P.’s Chief Operation Officer and Chief Risk
Offcier, Craig E. Klein, A.G.P.’s Chief Financial Officer/Principal Financial Officer, Phillip W. Michals, A.G.P.’s
Chief Executive Officer, John J. Venezia, A.G.P.’s Chief Compliance Officer, and David A. Bocchi, Trustee of the David Bocchi
Family Trust, which is an indirect owner of A.G.P., each of whom disclaims any beneficial ownership of such shares except to the
extent of their pecuniary interest.
|
|
|
|
|
|
|
(5)
|
With respect to before the offering, our sponsor is the record holder of such shares. William Lischak is the managing member of our sponsor. As such, William Lischak has voting and investment discretion with respect to the founder shares held of record by our sponsor and may be deemed to have shared beneficial ownership of the founder shares held directly by our sponsor. William Lischak disclaims beneficial ownership of any shares other than to the extent he may have a pecuniary interest therein, directly or indirectly.
|
Immediately after this offering, our initial stockholders
will beneficially own 20% of the then issued and outstanding shares of common stock (assuming none of them purchase any units offered
by this prospectus) and excluding the holders. None of our initial stockholders, officers, and directors has indicated to us that he intends
to purchase securities in this offering. Because of the ownership block held by our initial stockholders, they may be able to effectively
exercise control over all matters requiring approval by our stockholders, including the election of directors and approval of significant
corporate transactions other than approval of our initial business combination.
If the underwriters do not exercise all or
a portion of the over-allotment option, our initial stockholders will have up to 375,000 founder shares subject to forfeiture. Shares
will be forfeited only in the amount necessary to maintain our initial stockholders’ collective 20% ownership interest in our shares
of common stock, after giving effect to the offering and the exercise, if any, of the underwriters’ over-allotment option.
All of the insider shares issued and outstanding
prior to the date of this prospectus will be placed in escrow with American Stock Transfer & Trust Company, LLC, as escrow agent,
until the earlier of (A) one year after the date of the consummation of our initial business combination; or (B) the date on
which we complete a liquidation, merger, stock exchange or other similar transaction after our initial business combination that results
in all of our public stockholders having the right to exchange their shares of common stock for cash, securities or other properties.
Notwithstanding the foregoing, all of the founder shares will be released from the escrow account if (1) the last reported sale price
of our common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations)
for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination; or (2) if
we complete a transaction after our initial business combination that results in all of our stockholders having the right to exchange
their shares for cash, securities or other property. During the escrow period, the holders of these shares will not be able to sell or
transfer their securities except (1) to any persons (including their affiliates and stockholders) participating in the private placement
of the private placement units, officers, directors, stockholders, employees and members of our initial stockholders and their affiliates;
(2) amongst initial stockholders or their respective affiliates, or to our officers, directors, advisors, and employees; (3) if
a holder is an entity, as a distribution to its, partners, stockholders or members upon its liquidation; (4) by bona fide gift to
a member of the holder’s immediate family or to a trust, the beneficiary of which is a holder or a member of a holder’s immediate
family, for estate planning purposes; (5) by virtue of the laws of descent and distribution upon death; (6) pursuant to a qualified
domestic relations order; (7) by certain pledges to secure obligations incurred in connection with purchases of our securities; (8) by
private sales at prices no greater than the price at which the shares were originally purchased; or (9) for the cancellation of up
to shares of common stock subject to forfeiture to the extent that the underwriters’ over-allotment is not exercised in full or
in part or in connection with the consummation of our initial business combination, in each case (except for clause 9 or with our prior
consent) where the transferee agrees to the terms of the escrow agreement and the letter agreement. During the escrow period, the holders
of these shares will not be able to sell or transfer their securities except (i) for transfers to our officers, directors or their
respective affiliates (including for transfers to an entity’s members upon its liquidation); (ii) to relatives and trusts for
estate planning purposes; (iii) by virtue of the laws of descent and distribution upon death; (iv) pursuant to a qualified domestic
relations order; (v) by certain pledges to secure obligations incurred in connection with purchases of our securities; (vi) by
private sales made at or prior to the consummation of an initial business combination at prices no greater than the price at which the
shares were originally purchased; or (vii) to us for no value for cancellation in connection with the consummation of our initial
business combination, in each case (except for clause (vii)) where the transferee agrees to the terms of the escrow agreement, but will
retain all other rights as our stockholders, including, without limitation, the right to vote their shares of common stock and the right
to receive cash dividends, if declared. If dividends are declared and payable in shares of common stock, such dividends will also be placed
in escrow. If we are unable to effect an initial business combination and liquidate the trust account, none of our initial stockholders
will receive any portion of the liquidation proceeds with respect to their insider shares.
Our sponsor has committed to purchase from
us an aggregate of 361,000 units (or up to 376,000 units depending on the extent to which the underwriters’ over-allotment option
is exercised), at $10.00 per unit for a total purchase price of $3,610,000 (or up to $3,760,000 depending on the extent to which the
underwriters’ over-allotment option is exercised). These purchases will take place on a private placement basis simultaneously
with the consummation of this offering. A portion of the proceeds of the private placement will be added to the proceeds of this offering
and placed in a trust account in the United States maintained by American Stock Transfer & Trust Company, LLC, as trustee,
in an amount such that, at the time of the closing of this offering, $101,000,000 (or $116,150,000 if the over-allotment option is exercised
in full) will be held in the trust account. The remainder of such proceeds shall be held by us outside of the trust account for working
capital purposes.
Our sponsor, officers, and directors are deemed to be our “promoter”
(as such term is defined under the federal securities laws). In addition, Nick Kovacevich may be deemed to be a “promoter”
(as such term is defined under the federal securities laws) of ours due to his involvement in our early founding and organization. Mr.
Kovacevich is an investor in our sponsor, but did not receive, nor is he entitled to receive, any compensation for such activities.
RELATED PARTY TRANSACTIONS
On June 9, 2021, our sponsor
purchased 4,312,500 of our common shares for an aggregate purchase price of $25,000, which included 1,207,500 representative shares
previously transferred from our sponsor to an affiliate of A.G.P. on June 16, 2021 for $7,000 (up to 157,500 shares of which were
subject to forfeiture to the extent that the underwriters’ over-allotment option is not exercised in full or in part). On
November 22, 2021, we effected a 2 for 3 reverse stock split of our common stock, and A.G.P. sold back to our sponsor 55,000
founder shares for $478, such that our sponsor owns 2,125,000 founder shares, and A.G.P. owns 750,000 founder shares (of
which 277,174 founder shares and 97,826 founder shares, respectively, that are subject to forfeiture to the extent that the
over-allotment option is not exercised in full or in part so that our initial stockholders will collectively own 20% of our issued
and outstanding shares after this offering). The representative has agreed (A) to vote
the representative shares in favor of any proposed initial business combination; (B) not to convert representative shares in
connection with a stockholder vote to approve a proposed initial business combination or sell the representative shares to us in a
tender offer in connection with a proposed initial business combination; and (C) that the representative shares will not
participate in any liquidating distributions from our trust account upon winding up if an initial business combination is not
consummated. A.G.P. is acting as representative of the underwriters in this offering and will be paid an underwriting fee of
$500,000. We have engaged A.G.P. as an advisor in connection with our initial business combination to assist us in holding meetings
with our stockholders to discuss the potential initial business combination and the target business’ attributes, introduce us
to potential investors that are interested in purchasing our securities in connection with our initial business combination, assist
us in obtaining stockholder approval for the initial business combination and assist us with our press releases and public filings
in connection with the initial business combination. We will pay A.G.P. a fee for such marketing services upon the consummation of
our initial business combination in an amount equal to 4.5% of the gross proceeds of this offering (exclusive of any applicable
finders’ fees that might become payable). Our sponsor has agreed to purchase 361,000 units (or up to 376,000 units depending
on the extent to which the underwriters’ over-allotment option is exercised), at $10.00 per unit for a total purchase price of
$3,610,000 (or up to $3,760,000 depending on the extent to which the underwriters’ over-allotment option is exercised) on a
private placement basis simultaneously with the consummation of this offering. The private placement units are identical to the
public units, subject to certain limited exceptions as described in this prospectus. There will be no underwriting fees or
commissions with respect to the private placement units.
A portion of the proceeds from the sale of
the private placement units in the private placement will be added to the proceeds of this offering and placed in a trust account in
the United States maintained by American Stock Transfer & Trust Company, LLC, as trustee, in an amount such that, at the time
of the closing of this offering, $101,000,000 (or $116,150,000 if the over-allotment option is exercised in full), will be held in the
trust account for working capital purposes. The remainder of such proceeds shall be maintained by us outside of the trust account. If
we do not complete our initial business combination within 12 months (or up to 18 months, if extended), our initial stockholders will
waive any and all rights and claims to any proceeds and interest thereon in respect to the private placement units and the proceeds from
the sale of the private placement units that are held in the trust account will be included in the liquidating distribution to the holders
of our public shares.
The private placement units are identical to the
units sold to the public in this offering.
Prior to the commencement of this offering, our
sponsor agreed to loan us up to $300,000 to be used for a portion of the expenses of this offering. As of September 30, 2021, there was
$55,000 outstanding under such promissory notes. Our sponsor has agreed to apply all of the repayment proceeds from the repayment of the
notes to them to the pro rata portion of the private placement units our sponsor has committed to purchase.
The holders of our insider shares issued and outstanding
on the date of this prospectus, as well as the holders of the private placement units (and all underlying securities) and the representative
shares and will be entitled to registration rights pursuant to an agreement to be signed prior to or on the effective date of this offering.
The holders of a majority of these securities are entitled to make up to two demands that we register such securities. The holders of
the majority of the insider shares can elect to exercise these registration rights at any time commencing three months prior to the date
on which these shares of common stock are to be released from escrow. The holders of a majority of the private placement units can elect
to exercise these registration rights at any time after we consummate an initial business combination. In addition, the holders have certain
“piggy-back” registration rights with respect to registration statements filed subsequent to our consummation of an initial
business combination. We will bear the expenses incurred in connection with the filing of any such registration statements.
We
will reimburse our officers and directors for any reasonable out-of-pocket business expenses incurred by them in connection with certain
activities on our behalf such as identifying and investigating possible target businesses and initial business combinations. There is
no limit on the amount of out-of-pocket expenses reimbursable by us; provided, however, that to the extent such expenses exceed the available
proceeds not deposited in the trust account and the interest income earned on the amounts held in the trust account, such expenses would
not be reimbursed by us unless we consummate our initial business combination (other than up to $100,000 of such accrued interest
to pay dissolution costs and expenses). Our audit committee will review and approve all reimbursements and payments made to any
initial stockholder or member of our management team, or our or their respective affiliates, and any reimbursements and payments made
to members of our audit committee will be reviewed and approved by our board of directors, with any interested director abstaining from
such review and approval.
Other than fees payable to A.G.P. as described
in “Underwriting - Conflicts of Interest”, no compensation or fees of any kind, including finder’s fees, consulting
fees or other similar compensation, will be paid to any of our initial stockholders, officers or directors who owned our shares of common
stock prior to this offering, or to any of their respective affiliates, prior to or with respect to the initial business combination (regardless
of the type of transaction).
All ongoing and future transactions between us
on the one hand, and any of our officers and directors or their respective affiliates on the other hand, will be on terms believed by
us to be no less favorable to us than are available from unaffiliated third parties. Such transactions, including the payment of any compensation,
will require prior approval by a majority of our uninterested “independent” directors (to the extent we have any) or the members
of our board who do not have an interest in the transaction, in either case who had access, at our expense, to our attorneys or independent
legal counsel. We will not enter into any such transaction unless our disinterested “independent” directors (or, if there
are no “independent” directors, our disinterested directors) determine that the terms of such transaction are no less favorable
to us than those that would be available to us with respect to such a transaction from unaffiliated third parties.
Related Party Policy
Our code of ethics, which we will adopt upon consummation
of this offering, will require us to avoid, wherever possible, all related party transactions that could result in actual or potential
conflicts of interests, except under guidelines approved by our board of directors (or the audit committee). Related-party transactions
are defined as transactions in which (1) the aggregate amount involved will or may be expected to exceed $120,000 in any calendar
year; (2) we or any of our subsidiaries is a participant; and (3) any (a) executive officer, director or nominee for election
as a director; (b) greater than 5% beneficial owner of our common stock; or (c) immediate family member, of the persons referred
to in clauses (a) and (b), has or will have a direct or indirect material interest (other than solely as a result of being a director
or a less than 10% beneficial owner of another entity). A conflict of interest situation can arise when a person takes actions or has
interests that may make it difficult to perform their work objectively and effectively. Conflicts of interest may also arise if a person,
or a member of their family, receives improper personal benefits as a result of their position.
Our audit committee, pursuant to its written charter,
will be responsible for reviewing and approving related-party transactions to the extent we enter into such transactions. All ongoing
and future transactions between us on the one hand, and any of our officers and directors or their respective affiliates on the other
hand, will be on terms believed by us to be no less favorable to us than are available from unaffiliated third parties. Such transactions
will require prior approval by our audit committee and a majority of our uninterested “independent” directors, or the members
of our board who do not have an interest in the transaction, in either case who had access, at our expense, to our attorneys or independent
legal counsel. We will not enter into any such transaction unless our audit committee and a majority of our disinterested “independent”
directors determine that the terms of such transaction are no less favorable to us than those that would be available to us with respect
to such a transaction from unaffiliated third parties. Additionally, we require each of our directors and executive officers to complete
a directors and officers questionnaire that elicits information about related party transactions.
These procedures are intended to determine whether
any such related party transaction impairs the independence of a director or presents a conflict of interest on the part of a director,
employee or officer.
To further minimize potential conflicts of interest,
we have agreed not to consummate an initial business combination with an entity that is affiliated with any of our initial stockholders
unless we obtain an opinion from an independent investment banking firm that the initial business combination is fair to our unaffiliated
stockholders from a financial point of view. Furthermore, in no event will any of our existing officers, directors or initial stockholders,
or any entity with which they are affiliated, be paid any finder’s fee, consulting fee or other compensation prior to, or for any
services they render in order to effectuate, the consummation of an initial business combination.
DESCRIPTION OF SECURITIES
General
As of the effective date of the registration
statement of which this prospectus forms a part, our amended and restated certificate of incorporation will authorize the issuance of
50,000,000 shares of common stock, par value $0.0001. As of the date of this prospectus, 2,875,000 shares of common stock are issued
and outstanding, held by our initial stockholders (of which 375,000 shares held by our initial stockholders are subject to forfeiture
if the underwriters do not exercise their over-allotment option). No preferred shares are issued or outstanding. The following description
summarizes all of the material terms of our securities. Because it is only a summary, it may not contain all the information that is
important to you. For a complete description, you should refer to our certificate of incorporation and bylaws, which are filed as exhibits
to the registration statement of which this prospectus is a part.
Units
Each unit consists of one share of common
stock and one warrant. Each warrant entitles the holder thereof to purchase three-quarters (3/4) of a share of common stock at a price
of $11.50 per whole share, subject to adjustment as described in this prospectus. Each warrant will become exercisable on the later of
one year after the closing of this offering or the consummation of our initial business combination, and will expire five years after
the completion of our initial business combination, or earlier upon redemption. Pursuant to the warrant agreement, a warrantholder may
exercise its warrants only for a whole number of shares. This means that only an even number of public warrants may be exercised at any
given time by a warrantholder. For example, if a warrant holder holds one public warrant to purchase three-quarters (3/4) of one share
of common stock, such warrant shall not be exercisable. If a warrantholder holds two public warrants, such public warrants will be exercisable
for one share.
The shares of common stock and warrants comprising
the units will not be separately traded until 90 days after the effective date of this prospectus unless A.G.P. informs us of its decision
to allow earlier separate trading, but in no event will the shares of common stock and warrants be traded separately until we have filed
with the SEC a Current Report on Form 8-K that includes an audited balance sheet reflecting our receipt of the gross proceeds of
this offering. We will file a Current Report on Form 8-K which includes this audited balance sheet upon the consummation of this
offering, which is anticipated to take place three business days after the date of this prospectus. The audited balance sheet will include
proceeds we received from the exercise of the over-allotment option if such option is exercised prior to the filing of the Current Report
on Form 8-K. If the underwriters’ over-allotment option is exercised following the initial filing of such Current Report on
Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the
exercise of the underwriters’ over-allotment option.
Common Stock
Our holders of record of our common stock are
entitled to one vote for each share held on all matters to be voted on by stockholders. In connection with any vote held to approve our
initial business combination, our insiders, officers and directors, have agreed to vote their respective shares of common stock owned
by them immediately prior to this offering, including both the insider shares and any shares acquired in this offering or following this
offering in the open market, in favor of the proposed initial business combination.
We will consummate our initial business combination
only if (i) public stockholders do not exercise conversion rights in an amount that would cause our net tangible assets to be less
than $5,000,001 and (ii) a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination.
Pursuant to our amended and restated certificate
of incorporation, if we do not consummate our initial business combination within 12 months (or up to 18 months, if extended) from the
closing of this offering, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably
possible but not more than five business days thereafter, redeem 100% of the outstanding public shares, which redemption will completely
extinguish public stockholders’ rights as stockholders (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 stockholders and our board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to
our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Our insiders have
agreed to waive their rights to share in any distribution with respect to their insider shares.
Our stockholders have no conversion, preemptive,
or other subscription rights and there are no sinking fund or redemption provisions applicable to the shares of common stock, except that,
in connection with any proposed initial business combination, we will either (1) seek stockholder approval of such initial business
combination at a meeting called for such purpose at which public stockholders may seek to convert their public shares, regardless of whether
they vote for or against the proposed initial business combination, 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 stockholders with the opportunity to sell their public shares
to us by means of a tender offer (and thereby avoid the need for a stockholder 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.
If we hold a stockholder vote to amend any provisions
of our certificate of incorporation relating to stockholder’s rights or pre-initial business combination activity (including the
substance or timing within which we have to complete an initial business combination), we will provide our public stockholders with the
opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to
the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously
released to us to pay our franchise and income taxes, divided by the number of then-outstanding public shares, in connection with any
such vote. In either of such events, converting stockholders would be paid their pro rata portion of the trust account promptly following
consummation of the initial business combination or the approval of the amendment to the certificate of incorporation. If the initial
business combination is not consummated or the amendment is not approved, stockholders will not be paid such amounts.
Preferred Stock
There are no shares of preferred stock outstanding.
No shares of preferred stock are being issued or registered in this offering. Accordingly, our board of directors is empowered, without
stockholder approval, to issue preferred stock with dividend, liquidation, conversion, voting or other rights that could adversely affect
the voting power or other rights of the holders of common stock. However, the underwriting agreement prohibits us, prior to an initial
business combination, from issuing preferred stock that participates in any manner in the proceeds of the trust account, or that votes
as a class with the common stock on our initial business combination. We may issue some or all of the preferred stock to effect our initial
business combination. In addition, the preferred stock could be utilized as a method of discouraging, delaying or preventing a change
in control of us. Although we do not currently intend to issue any shares of preferred stock, we reserve the right to do so in the future.
Warrants
Public Warrants
No warrants are currently outstanding. Each
warrant will entitle the registered holder to purchase three-quarters (3/4) of a share of common stock at a price of $11.50 per whole
share, subject to adjustment as discussed below, upon the later of: (i) one year after the date that the registration statement
of which this prospectus forms a part is declared effective by the SEC; and (ii) the consummation by us of an initial business combination
and terminating on the five-year anniversary of the completion of the initial business combination.
Pursuant to the warrant agreement, a warrantholder
may exercise its warrants only for a whole number of shares. This means that only an even number of public warrants may be exercised
at any given time by a warrantholder. However, no public warrants will be exercisable for cash unless we have an effective and current
registration statement covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to
such shares of common stock. Notwithstanding the foregoing, if a registration statement covering the shares of common stock issuable
upon exercise of the public warrants is not effective within 60 business days from the closing of our initial business combination, warrant
holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain
an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under
the Securities Act. The warrants will expire five years from the closing of our initial business combination at 5:00 p.m., New York City
time.
We may call the outstanding warrants for redemption
(including any warrants already issued upon exercise of the unit purchase option), in whole and not in part, at a price of $0.01 per warrant:
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at any time while the warrants are exercisable,
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upon not less than 30 days’ prior written notice of redemption to each warrant holder,
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provided that the reported last sale price of the shares of our common stock equals or exceeds $18.00 per share, for any 20 trading days within a 30-day trading period ending on the third business day prior to the notice of redemption to warrant holders, and
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Provided that there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.
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The right to exercise will be forfeited unless
the warrants are exercised prior to the date specified in the notice of redemption. On and after the redemption date, a record holder
of a warrant will have no further rights except to receive the redemption price for such holder’s warrant upon surrender of such
warrant.
The redemption criteria for our warrants have
been established at a price that is intended to provide warrant holders a reasonable premium to the initial exercise price and provide
a sufficient differential between the then-prevailing share price and the warrant exercise price so that if the share price declines as
a result of our redemption call, the redemption will not cause the share price to drop below the exercise price of the warrants.
If we call the warrants for redemption as described
above, our management will have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.”
In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common stock equal to
the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by
the difference between the exercise price of the warrants and the “fair market value” (defined below) by (y) the fair
market value. The “fair market value” shall mean the average reported last sale price of our common stock for the 20 trading
days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether we
will exercise our option to require all holders to exercise their warrants on a “cashless basis” will depend on a variety
of factors including the price of our common shares at the time the warrants are called for redemption, our cash needs at such time and
concerns regarding dilutive share issuances.
The warrants will be issued in registered form
under our Warrant Agreement with American Stock Transfer & Trust Company, LLC, as warrant agent. The warrant agreement provides
that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision,
but requires the approval, by written consent or vote, of the holders of a majority of the then-outstanding warrants in order to make
any change that adversely affects the interests of the registered holders.
The exercise price and number of shares of common
stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary
dividend or our recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be
adjusted for issuances of shares of common stock at a price below their respective exercise prices.
If (x) we issue additional shares of common
stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at a
Newly Issued Price of less than $9.20 per share of common stock (with such issue price or effective issue price to be determined in good
faith by our board of directors, and in the case of any such issuance to our initial stockholders or their affiliates, without taking
into account any founders’ shares held by them prior to such issuance); (y) 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 (z) the Market Value is below $9.20
per share, then (A) 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 and (ii) the Newly Issued Price, and (B) the $9.20 per share redemption trigger price described
above will be adjusted (to the nearest cent) to be equal to 180% of the greater of (i) the Market Value and (ii) the Newly Issued
Price. The warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the
warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied
by full payment of the exercise price, by certified or official bank check payable to us, for the number of warrants being exercised.
The warrant holders do not have the rights or privileges of holders of shares of common stock and any voting rights until they exercise
their warrants and receive shares of common stock. After the issuance of shares of common stock upon exercise of the warrants, each holder
will be entitled to one vote for each share held of record on all matters to be voted on by stockholders.
Except as described above, no public warrants
will be exercisable for cash and we will not be obligated to issue shares of common stock unless at the time a holder seeks to exercise
such warrant, a prospectus relating to the shares of common stock issuable upon exercise of the warrants is current and the shares of
common stock have been registered or qualified or deemed to be exempt under the securities laws of the state of residence of the holder
of the warrants. Under the terms of the warrant agreement, we have agreed to use our best efforts to meet these conditions and to maintain
a current prospectus relating to the shares of common stock 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 and, if we do not maintain a current prospectus relating to the shares of
common stock issuable upon exercise of the warrants, holders will be unable to exercise their warrants and we will not be required to
settle any such warrant exercise. If the prospectus relating to the shares of common stock issuable upon the exercise of the warrants
is not current or if the common stock is not qualified or exempt from qualification in the jurisdictions in which the holders of the warrants
reside, we will not be required to net cash settle or cash settle the warrant exercise, the warrants may have no value, the market for
the warrants may be limited and the warrants may expire worthless.
Warrant holders may elect to be subject to a restriction
on the exercise of their warrants such that an electing warrant holder would not be able to exercise their warrants to the extent that,
after giving effect to such exercise, such holder would beneficially own in excess of 9.9% of the shares of common stock outstanding.
No fractional shares will be issued upon exercise
of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon
exercise, round down to the nearest whole number of shares of common stock to be issued to the warrant holder.
Private placement warrants
The private placement warrants (including the
common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after
the completion of our initial business combination (except, among other limited exceptions as further described below in this section,
to our officers and directors and other persons or entities affiliated with our initial stockholders) and they will not be redeemable
by us so long as they are held by our initial stockholders or their permitted transferees. Except as described herein, the private placement
warrants have terms and provisions that are identical to those of the warrants being sold as part of the units in this offering, including
as to exercise price, exercisability, transferability, and redemption.
Pursuant
to the letter agreements, the private placement warrants (including the common stock issuable upon exercise of any of the private placement
warrants) are not transferable or salable until 30 days after the completion of our initial business combination, except (a) to
our officers or directors, any affiliates or family members of any of our officers or directors, our initial stockholders, or any of their
respective affiliates; (b) in the case of an individual, by gift to a member of the individual’s immediate family or to a trust,
the beneficiary of which is a member of the individual’s immediate family, an affiliate of such person or to a charitable organization;
(c) in the case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d) in the case
of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with the
consummation of our initial business combination at prices no greater than the price at which the shares or warrants were originally purchased;
(f) in the event of our liquidation prior to the completion of our initial business combination; or (g) by virtue of the laws
of Delaware or the applicable limited liability company agreement upon dissolution of sponsor provided, however, that in the case of clauses
(a) through (e) or (g), these permitted transferees must enter into a written agreement agreeing to be bound by these transfer
restrictions, and the other restrictions contained in the letter agreements, with respect to such securities (including provisions relating
to voting, the trust account and liquidation distributions described elsewhere in this prospectus).
Dividends
We have not paid any cash dividends on our shares
of common stock to date and do not intend to pay cash dividends prior to the completion of an initial business combination. The payment
of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition
subsequent to completion of an initial business combination. The payment of any dividends subsequent to an initial business combination
will be within the discretion of our then board of directors. It is the present intention of our board of directors to retain all earnings,
if any, for use in our business operations and, accordingly, our board does not anticipate declaring any dividends in the foreseeable
future.
Our Transfer Agent and Warrant Agent
The transfer agent for our shares of common stock
and warrant agent for our warrants is American Stock Transfer & Trust Company, LLC, 6201 15th Avenue, Brooklyn, NY 11219.
Our Amended and Restated Certificate of Incorporation
Our amended and restated certificate of incorporation
will contain certain requirements and restrictions relating to this offering that will apply to us until the completion of our initial
business combination. These provisions cannot be amended without the approval of the holders of at least a majority of our common stock.
Our initial stockholders, who will collectively beneficially own 20% of our common stock upon the closing of this offering (assuming they
do not purchase any units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation
and will have the discretion to vote in any manner they choose. Specifically, our amended and restated certificate of incorporation will
provide, among other things, that:
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If we are unable to complete
our initial business combination within 12 months (or up to 18 months, if extended) from the closing
of this offering, 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 subject to lawfully
available funds therefor, redeem 100% of the public shares, at a per-share price, payable in cash,
equal to the aggregate amount then on deposit in the trust account including interest earned on the
funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000
of interest to pay dissolution expenses), divided by the number of then-outstanding public shares,
which redemption will completely extinguish public stockholders’ rights as stockholders (including
the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject to the approval of our remaining
stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations
under Delaware law to provide for claims of creditors and the requirements of other applicable law;
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Prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote on any initial business combination;
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Although we do not intend to enter into our initial business combination with a target business that is affiliated with our sponsor, our directors, our officers, or our representative, we are not prohibited from doing so. In the event we enter into such a transaction, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions that such our initial business combination is fair to our stockholders from a financial point of view;
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If a stockholder vote on our initial business combination is not required by law and we do not decide to hold a stockholder vote for business or other legal reasons, we will offer to redeem our public shares pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, and will file tender offer documents with the SEC prior to completing our initial business combination that contain substantially the same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act; whether or not we maintain our registration under the our Exchange Act or our listing on Nasdaq, we will provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above;
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So long as we obtain and maintain a listing for our securities on Nasdaq, Nasdaq rules require that we must complete one or more initial business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the fee payable to A.G.P. upon an initial business combination as described in “Underwriting - Conflicts of Interest” and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination;
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If
our stockholders approve an amendment to our amended and restated certificate of incorporation
(i) to modify the substance or timing of our obligation to allow redemption in connection
with our initial business combination or to redeem 100% of our public shares if we do not
complete our initial business combination within 12 months (or up to 18 months, if extended)
from the closing of this offering or (ii) with respect to any other provision relating
to stockholders’ rights or pre-initial business combination activity, we will provide
our public stockholders with the opportunity to redeem all or a portion of their shares of
common stock 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 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;
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We will not effectuate our initial business combination with another blank check company or a similar company with nominal operations; and
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In addition, our amended and restated certificate
of incorporation will provide that we may only redeem our public shares so long as our net tangible assets are at least $5,000,001 either
immediately prior to, or upon consummation of, our initial business combination, and after payment of underwriters’ fees and commissions.
Certain Anti-Takeover Provisions of Delaware Law and our Amended
and Restated Certificate of Incorporation and Bylaws
We have opted out of Section 203 of the DGCL.
However, our amended and restated certificate of incorporation contains similar provisions providing that we may not engage in certain
“initial business combinations” with any “interested stockholder” for a three-year period following the time that
the stockholder became an interested stockholder, unless:
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prior to such time, our board of directors approved either the
initial business combination or the transaction that resulted in the stockholder becoming an interested stockholder;
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upon consummation of the transaction that resulted in the stockholder
becoming an interested stockholder, the interested stockholder owned at least 85% of our voting stock outstanding at the time the transaction
commenced (excluding certain shares); or
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on or subsequent to such time, the initial business combination
is approved by the Board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative
vote of at least two-thirds of the outstanding voting stock not owned by the interested stockholders.
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Generally, a “initial business combination”
includes a merger, asset or stock sale to the interested stockholder. Subject to certain exceptions, an “interested stockholder”
is a person who, together with that person’s affiliates and associates, owns, or within the previous three years owned, 15% or
more of our voting stock.
Under some circumstances, this provision will
make it more difficult for a person who is an interested stockholder to effect various initial business combinations with us for a three-year
period.
Our
certificate of incorporation will provide that our initial stockholders and
their various affiliates, successors, and transferees will not be deemed to be “interested stockholders” regardless of the
percentage of our voting stock owned by them, and accordingly will not be subject to this provision.
Our authorized but unissued common stock and preferred
stock are available for future issuances without stockholder approval and could be utilized for a variety of corporate purposes, including
future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved
common stock and preferred stock could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest,
tender offer, merger or otherwise.
Special meeting of stockholders
Our bylaws provide that special meetings of our
stockholders may be called by resolution of our board of directors, the Chief Executive Officer, or the Chairperson of our board of directors.
Advance notice requirements for stockholder
proposals and director nominations
Our bylaws will provide that stockholders seeking
to bring business before our annual meeting of stockholders, or to nominate candidates for election as directors at our annual meeting
of stockholders must provide timely notice of their intent in writing. To be timely, a stockholder’s notice will need to be delivered
to our principal executive offices not later than the close of business on the 90th day nor earlier than the opening of business on the
120th day prior to the scheduled date of the annual meeting of stockholders. Our bylaws also specify certain requirements as to the form
and content of a stockholders’ meeting. These provisions may preclude our stockholders from bringing matters before our annual meeting
of stockholders or from making nominations for directors at our annual meeting of stockholders
Authorized but unissued shares
Our authorized but unissued common stock and preferred
stock are available for future issuances without stockholder approval and could be utilized for a variety of corporate purposes, including
future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved
common stock and preferred stock could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest,
tender offer, merger or otherwise.
Exclusive forum for certain lawsuits
Our amended and restated certificate of incorporation
will provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware
shall, to the fullest extent permitted by law, be the sole and exclusive forum for any (1) derivative action or proceeding brought
on behalf of our company, (2) action asserting a claim of breach of a fiduciary duty owed by any director, officer, employee or
agent of our company to our company or our stockholders, or any claim for aiding and abetting any such alleged breach, (3) action
asserting a claim against our company or any director or officer of our company arising pursuant to any provision of the DGCL or our
amended and restated certificate of incorporation or our bylaws, or (4) action asserting a claim against us or any director or officer
of our company governed by the internal affairs doctrine except for, as to each of (1) through (4) above, any claim (A) as
to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery
(and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination),
(B) that is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or (C) arising under
the federal securities laws, including the Securities Act as to which the Court of Chancery and the federal district court for the District
of Delaware shall concurrently be the sole and exclusive forums. Notwithstanding the foregoing, the inclusion of such provision in our
amended and restated certificate of incorporation will not be deemed to be a waiver by our stockholders of our obligation to comply with
federal securities laws, rules and regulations, and the provisions of this paragraph 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
shall be the sole and exclusive forum. Although we believe this provision benefits us by providing increased consistency in the application
of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits against our
directors and officers. Furthermore, the enforceability of choice of forum provisions in other companies’ certificates of incorporation
has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or
unenforceable.
SECURITIES ELIGIBLE FOR FUTURE SALE
Upon the closing of this offering, 12,861,000
shares of our common stock will be outstanding (assuming no exercise of the underwriters’ over-allotment option and the corresponding
forfeiture of 375,000 founder shares by our initial stockholders), including 10,000,000 shares of our common stock underlying the public
units offered in this offering, 2,500,000 shares held by our initial stockholders, and 361,000 shares underlying the private placement
units. Of these shares, the 10,000,000 public shares sold in this offering, or 11,500,000 public shares if the over-allotment option
is exercised in full, will be freely tradable without restriction or further registration under the Securities Act, except for any shares
purchased by one of our affiliates within the meaning of Rule 144 under the Securities Act. All of the remaining shares are restricted
securities under Rule 144, in that they were issued in private transactions not involving a public offering. None of those shares
will be transferable except in limited circumstances described elsewhere in this prospectus.
Rule 144
A person who has beneficially owned restricted
shares of common stock or warrants for at least six months would be entitled to sell their securities provided that (i) such person
is not deemed to have been one of our affiliates at the time of, or at any time during the three months preceding, a sale and (ii) we
are subject to the Exchange Act periodic reporting requirements for at least three months before the sale. Persons who have beneficially
owned restricted shares of common stock for at least six months but who are our affiliates at the time of, or any time during the three
months preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month
period a number of shares that does not exceed the greater of either of the following:
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1% of the number of
shares of common stock then issued and outstanding, which will equal 128,610 shares immediately after this offering (or 147,510 if
the over-allotment option is exercised in full); and
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The average weekly trading volume of the shares of common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.
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Sales under Rule 144 are also limited by
manner of sale provisions and notice requirements and to the availability of current public information about us.
Restrictions on the Use of Rule 144 by
Shell Companies or Former Shell Companies
Historically, the SEC staff had taken the position
that Rule 144 is not available for the resale of securities initially issued by companies that are, or previously were, blank check
companies, like us. The SEC has codified and expanded this position in the amendments discussed above by prohibiting the use of Rule 144
for resale of securities issued by any shell companies (other than initial business combination related shell companies) or any issuer
that has been at any time previously a shell company. The SEC has provided an important exception to this prohibition, however, if the
following conditions are met:
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the issuer of the securities that was formerly a shell company has ceased to be a shell company;
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the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act;
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the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Form 8-K reports; and
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at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company.
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As a result, it is likely that pursuant to Rule 144,
our initial stockholders will be able to sell their insider shares freely without registration one year after we have completed our initial
business combination assuming they are not an affiliate of ours at that time.
Registration Rights
The holders of our insider shares issued and outstanding
on the date of this prospectus, as well as the holders of the private placement units (and underlying securities) and the representative
shares will be entitled to customary registration rights pursuant to an agreement to be signed prior to or on the effective date of this
offering. The holders of a majority of these securities are entitled to make up to two demands that we register such securities. The holders
of the majority of the insider shares can elect to exercise these registration rights at any time commencing three months prior to the
date on which these shares of common stock are to be released from escrow. In addition, the holders have certain “piggy-back”
registration rights with respect to registration statements filed subsequent to our consummation of an initial business combination. We
will bear the expenses incurred in connection with the filing of any such registration statements.
U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following is a discussion of the material
U.S. federal income tax considerations generally applicable to the acquisition, ownership and disposition of our units, shares of common
stock and warrants, which we refer to collectively as our securities. Because the components of a unit are separable at the option of
the holder, the holder of a unit generally should be treated, for U.S. federal income tax purposes, as the owner of the underlying common
stock and one warrant to purchase three-quarters (3/4) of one share of common stock, as the case may be. As a result, the discussion
below with respect to holders of common stock and warrants should also apply to holders of units (as the deemed owners of the underlying
common stock and warrants that comprise the units). This discussion applies only to securities that are held as capital assets for U.S.
federal income tax purposes and is applicable only to holders who purchased units in this offering.
This discussion is a summary only and does not
describe all of the tax consequences that may be relevant to you in light of your particular circumstances, including but not limited
to the alternative minimum tax, the Medicare tax on certain investment income and the different consequences that may apply if you are
subject to special rules that apply to certain types of investors, including but not limited to:
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our sponsor, founders, officers, or directors;
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financial institutions or financial services entities;
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governments or agencies or instrumentalities thereof;
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regulated investment companies;
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real estate investment trusts;
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expatriates or former long-term residents of the United States;
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persons that actually or constructively own five percent or more of our stock by vote or value;
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dealers or traders subject to a mark-to-market method of accounting with respect to the securities;
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persons holding our securities as part of a “straddle,” hedge, integrated transaction or similar transaction;
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U.S. holders (as defined below) whose functional currency is not the U.S. dollar;
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partnerships or other pass-through entities for U.S. federal income tax purposes and any beneficial owners of such entities; and
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persons that acquired our securities pursuant to an exercise of employee share options, in connection with employee share incentive plans or otherwise as compensation or in connection with services;
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tax-exempt entities.
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If a partnership (or other entity classified as
a partnership for U.S. federal income tax purposes) is the beneficial owner of our securities, the U.S. federal income tax treatment of
a partner in the partnership generally will depend on the status of the partner and the activities of the partnership. Partnerships holding
our securities and partners in such partnerships are urged to consult their own tax advisors.
This discussion is based on the Internal Revenue
Code of 1986, as amended (the “Code”), and administrative pronouncements, judicial decisions and final, temporary and proposed
Treasury regulations as of the date hereof, which are subject to change, possibly on a retroactive basis, and changes to any of which
subsequent to the date of this prospectus may affect the tax consequences described herein. This discussion does not address any aspect
of state, local or non-U.S. taxation, or any U.S. federal taxes other than income taxes (such as gift and estate taxes).
We have not sought, and will not seek, a ruling
from the Internal Revenue Service (the “IRS”) as to any U.S. federal income tax consequence described herein. The IRS may
disagree with the discussion herein, and its determination may be upheld by a court. Moreover, there can be no assurance that future legislation,
regulations, administrative rulings or court decisions will not adversely affect the accuracy of the statements in this discussion. You
are urged to consult your tax advisor with respect to the application of U.S. federal tax laws to your particular situation, as well as
any tax consequences arising under the laws of any state, local or foreign jurisdiction.
THIS DISCUSSION OF U.S. FEDERAL INCOME TAX CONSIDERATIONS
IS FOR GENERAL INFORMATION PURPOSES ONLY AND IS NOT TAX ADVICE. WE URGE PROSPECTIVE HOLDERS TO CONSULT THEIR TAX ADVISORS CONCERNING THE
U.S. FEDERAL INCOME TAX CONSEQUENCES TO THEM OF ACQUIRING, OWNING AND DISPOSING OF OUR SECURITIES, AS WELL AS THE APPLICATION OF ANY,
STATE, LOCAL AND NON-U.S. INCOME, ESTATE AND OTHER TAX CONSIDERATIONS.
Personal Holding Company Status
We would be subject to a second level of U.S.
federal income tax on a portion of our income if we are determined to be a personal holding company, or PHC, for U.S. federal income tax
purposes. A U.S. corporation generally will be classified as a PHC for U.S. federal income tax purposes in a given taxable year if (i) at
any time during the last half of such taxable year, five or fewer individuals (without regard to their citizenship or residency and including
as individuals for this purpose certain entities such as certain tax-exempt organizations, pension funds and charitable trusts) own or
are deemed to own (pursuant to certain constructive ownership rules) more than 50% of the stock of the corporation by value and (ii) at
least 60% of the corporation’s adjusted ordinary gross income, as determined for U.S. federal income tax purposes, for such taxable
year consists of PHC income (which includes, among other things, dividends, interest, certain royalties, annuities and, under certain
circumstances, rents).
Depending on the date and size of our initial
business combination, it is possible that at least 60% of our adjusted ordinary gross income may consist of PHC income. In addition,
depending on the concentration of our stock in the hands of individuals, including the members of our sponsor and certain tax-exempt
organizations, pension funds and charitable trusts, it is possible that more than 50% of our stock may be owned or deemed owned (pursuant
to the constructive ownership rules) by five or fewer such persons during the last half of a taxable year. Thus, no assurance can be
given that we will not be a PHC following this offering or in the future. If we are or were to become a PHC in a given taxable year,
we would be subject to an additional PHC tax, currently 20%, on our undistributed PHC income, which generally includes our taxable income,
subject to certain adjustments.
Allocation of Purchase Price and Characterization
of a Unit
No statutory, administrative or judicial authority
directly addresses the treatment of the unit or instruments similar to the unit for U.S. federal income tax purposes and, therefore,
that treatment is not entirely clear. The acquisition of a unit should be treated for U.S. federal income tax purposes as the acquisition
of one share of our common stock and of one warrant, with each warrant exercisable to purchase three-quarters of one share of our common
stock. No fractional shares will be issued. We intend to treat the acquisition of a unit in this manner and, by purchasing a unit, you
agree to adopt such treatment for tax purposes. For U.S. federal income tax purposes, each holder of a unit must allocate the purchase
price paid by such holder for such unit between the one share of common stock and one warrant to purchase three-quarters of one share
of common stock based on the relative fair market value of each at the time of issuance. Under U.S. federal income tax law, each investor
must make its own determination of such value based on all the relevant facts and circumstances. Therefore, we strongly urge each investor
to consult its tax advisor regarding the determination of value for these purposes. The price allocated to each share of common stock
and the warrant to purchase three-quarters of a share of common stock should be the holder’s initial tax basis in such share or
of one warrant to purchase three-quarters of one share of common, as the case may be. Any disposition of a unit should be treated for
U.S. federal income tax purposes as a disposition of the share of common stock and one warrant to purchase three-quarters of one share
of common stock that comprises the unit, and the amount realized on the disposition should be allocated between the common stock and one warrant to purchase three-quarters of one share of common stock based on their respective relative fair market values (as
determined by each such unit holder based on all the relevant facts and circumstances) at the time of disposition. The separation of
shares of common stock and warrants comprising units should not be a taxable event for U.S. federal income tax purposes.
The foregoing treatment of the units and a holder’s
purchase price allocation are not binding on the IRS or the courts. Because there are no authorities that directly address instruments
that are similar to the units, no assurance can be given that the IRS or the courts will agree with the characterization described above
or the discussion below. Accordingly, each prospective investor is urged to consult its own tax advisors regarding the tax consequences
of an investment in a unit (including alternative characterizations of a unit). The balance of this discussion assumes that the characterization
of the units described above is respected for U.S. federal income tax purposes.
U.S. Holders
This section applies to you if you are a “U.S.
holder.” A U.S. holder is a beneficial owner of our units, shares of common stock or warrants who or that is, for U.S. federal income
tax purposes:
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an individual who is a citizen or resident of the United States;
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a corporation (or other entity taxable as a corporation) organized in or under the laws of the United States, any state thereof or the District of Columbia;
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an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or
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a trust, if (i) a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons (as defined in the Code) have authority to control all substantial decisions of the trust or (ii) it has a valid election in effect under Treasury Regulations to be treated as a U.S. person.
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Taxation of Distributions
If we pay distributions
in cash or other property (other than certain distributions of our stock or rights to acquire our stock) to U.S. holders of shares of
our common stock, such distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid from
our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of current
and accumulated earnings and profits will constitute a return of capital that will be applied against and reduce (but not below zero)
the U.S. holder’s adjusted tax basis in our common stock. Any remaining excess will be treated as gain realized on the sale or other
disposition of the common stock and will be treated as described under “U.S. Holders — Gain or Loss on Sale, Taxable
Exchange or Other Taxable Disposition of Common Stock and Warrants” below.
Dividends we pay to a U.S. holder that is a taxable
corporation generally will qualify for the dividends received deduction if the requisite holding period is satisfied. With certain exceptions
(including, but not limited to, dividends treated as investment income for purposes of investment interest deduction limitations), and
provided certain holding period requirements are met, dividends we pay to a non-corporate U.S. holder may constitute “qualified
dividends” that will be subject to tax at the preferential tax rate accorded to long-term capital gains. It is unclear whether the
redemption rights with respect to the common stock described in this prospectus may prevent a U.S. holder from satisfying the applicable
holding period requirements with respect to the dividends received deduction or the preferential tax rate on qualified dividend income,
as the case may be. If the holding period requirements are not satisfied, then a corporation may not be able to qualify for the dividends
received deduction and would have taxable income equal to the entire dividend amount, and non-corporate holders may be subject to tax
on such dividend at regular ordinary income tax rates instead of the preferential rate that applies to qualified dividend income.
Gain or Loss on Sale, Taxable Exchange or
Other Taxable Disposition of Common Stock and Warrants.
Upon a sale or other taxable disposition of our
common stock or warrants that, in general, would include a redemption of common stock or warrants that is treated as a sale of such securities
as described below, and including as a result of a dissolution and liquidation in the event we do not consummate our initial business
combination within the required time period, a U.S. holder generally will recognize capital gain or loss in an amount equal to the difference
between the amount realized and the U.S. holder’s adjusted tax basis in the common stock or warrants so disposed of. Any such capital
gain or loss generally will be long-term capital gain or loss if the U.S. holder’s holding period for the common stock or warrants
so disposed of exceeds one year. It is unclear, however, whether the redemption rights with respect to the common stock described in this
prospectus may suspend the running of the applicable holding period for this purpose. If the running of the holding period for the common
stock is suspended, then non-corporate U.S. holders may not be able to satisfy the one-year holding period requirement for long-term capital
gain treatment, in which case any gain on a sale or taxable disposition of the shares or warrants would be subject to short-term capital
gain treatment and would be taxed at regular ordinary income tax rates. Long-term capital gains recognized by non-corporate U.S. holders
are currently eligible to be taxed at reduced rates. The deductibility of capital losses is subject to limitations.
Generally, the amount of gain or loss recognized
by a U.S. holder is equal to the difference between (i) the sum of the amount of cash and the fair market value of any property
received in such disposition (or, if the common stock or warrants are held as part of units at the time of the disposition, the portion
of the amount realized on such disposition that is allocated to the common stock or the warrants based upon the then relative fair market
values of the common stock and the warrants included in the units) and (ii) the U.S. holder’s adjusted tax basis in its common
stock or warrants so disposed of. A U.S. holder’s adjusted tax basis in its common stock or warrants generally will equal the U.S.
holder’s acquisition cost (that is, as discussed above, the portion of the purchase price of a unit allocated to a share of common
stock or one warrant to purchase three-quarters of one share of common stock or, as discussed
below, the U.S. holder’s initial basis for common stock received upon exercise of warrants) less,
in the case of a share of common stock, any prior distributions treated as a return of capital.
Redemption of Common Stock
In the event that a U.S. holder’s common
stock is redeemed pursuant to the redemption provisions described under the section of this prospectus entitled “Description
of Securities — Common Stock” or if we purchase a U.S. holder’s common stock in an open market transaction
(each of which we refer to as a “redemption”), the treatment of the transaction for U.S. federal income tax purposes will
depend on whether the redemption qualifies as a sale or exchange of the common stock under Section 302 of the Code. If the redemption
qualifies as a sale or exchange of common stock, the U.S. holder will be treated as described under “U.S. Holders — Gain
or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Common Stock and Warrants” above. If the redemption does not qualify
as a sale or exchange of common stock, the U.S. holder will be treated as receiving a corporate distribution with the tax consequences
described above under “U.S. Holders — Taxation of Distributions”. Whether a redemption qualifies for sale
or exchange treatment will depend largely on the total number of shares of our stock treated as owned by the U.S. holder (including any
stock constructively owned by the U.S. holder described in the following paragraph) relative to all of our shares outstanding both before
and after the redemption. The redemption of common stock generally will be treated as a sale of the common stock (rather than as a corporate
distribution) if the redemption (i) is “substantially disproportionate” with respect to the U.S. holder, (ii) results
in a “complete termination” of the U.S. holder’s interest in us or (iii) is “not essentially equivalent to
a dividend” with respect to the U.S. holder. These tests are explained more fully below.
In determining whether any of the foregoing tests
are satisfied, a U.S. holder takes into account not only stock actually owned by the U.S. holder, but also shares of our stock that are
constructively owned by it. A U.S. holder may constructively own, in addition to stock owned directly, stock owned by certain related
individuals and entities in which the U.S. holder has an interest or that have an interest in such U.S. holder, as well as any stock the
U.S. holder has a right to acquire by exercise of an option, which would generally include common stock that could be acquired pursuant
to the exercise of the warrants. In order to meet the substantially disproportionate test, the percentage of our outstanding voting stock
actually and constructively owned by the U.S. holder immediately following the redemption of common stock must, among other requirements,
be less than 80% of the percentage of our outstanding voting stock actually and constructively owned by the U.S. holder immediately before
the redemption. There will be a complete termination of a U.S. holder’s interest if either (i) all of the shares of our stock
actually and constructively owned by the U.S. holder are redeemed or (ii) all of the shares of our stock actually owned by the U.S.
holder are redeemed and the U.S. holder is eligible to waive, and effectively waives in accordance with specific rules, the attribution
of stock owned by certain family members and the U.S. holder does not constructively own any other shares of our stock (including any
stock constructively owned by the U.S. holder as a result of owning warrants). The redemption of the common stock will not be essentially
equivalent to a dividend with respect to a U.S. holder if the redemption results in a “meaningful reduction” of the U.S. holder’s
proportionate interest in us. Whether the redemption will result in a meaningful reduction in a U.S. holder’s proportionate interest
in us will depend on the particular facts and circumstances. However, the IRS has indicated in a published ruling that even a small reduction
in the proportionate interest of a small minority stockholder in a publicly held corporation who exercises no control over corporate affairs
may constitute such a “meaningful reduction.” A U.S. holder should consult with its own tax advisors as to the tax consequences
of a redemption.
If none of the foregoing tests is satisfied, then
the redemption will be treated as a corporate distribution and the tax effects will be as described under “U.S. Holders —
Taxation of Distributions,” above. After the application of those rules, any remaining tax basis of the U.S. holder in the redeemed
common stock will be added to the U.S. holder’s adjusted tax basis in its remaining shares, or, if it has none, to the U.S. holder’s
adjusted tax basis in its warrants or possibly in other stock constructively owned by it. A U.S. holder should consult its tax advisors
as to the allocation of any remaining basis.
Exercise, Lapse, or Redemption of a Warrant
Except as discussed below with respect to the
cashless exercise of a warrant, a U.S. holder generally will not recognize taxable gain or loss on the acquisition of common stock upon
exercise of a warrant for cash. The U.S. holder’s tax basis in the share of our common stock received upon exercise of the warrant
generally will be an amount equal to the sum of the U.S. holder’s initial investment in the warrant (i.e., the portion of the U.S.
holder’s purchase price for the units that is allocated to the warrant, as described above under “— Allocation of Purchase
Price and Characterization of a Unit”) and the exercise price of such warrant. It is unclear whether the U.S. holder’s holding
period for the common stock received upon exercise of the warrants will begin on the date following the date of exercise or on the date
of exercise of the warrants; in either case, the holding period will not include the period during which the U.S. holder held the warrants.
If a warrant is allowed to lapse unexercised, a U.S. holder generally will recognize a capital loss equal to such holder’s tax basis
in the warrant.
The tax consequences of a cashless exercise of
a warrant are not clear under current tax law. A cashless exercise may be tax-free, either because the exercise is not a realization event
or because the exercise is treated as a recapitalization for U.S. federal income tax purposes. In either tax-free situation, a U.S. holder’s
tax basis in the common stock received generally should equal the holder’s tax basis in the warrants exercised therefor. If the
cashless exercise were treated as not being a realization event (and not a recapitalization), it is unclear whether a U.S. holder’s
holding period for the common stock would be treated as commencing on the date following the date of exercise or on the date of exercise
of the warrant; in either case, the holding period would not include the period during which the U.S. holder held the warrants. If the
cashless exercise were treated as a recapitalization, the holding period of the common stock would include the holding period of the warrants
exercised therefor.
It is also possible that a cashless exercise could
be treated in part as a taxable exchange in which gain or loss would be recognized. In such event, a U.S. holder could be deemed to have
surrendered a number of warrants (or the surrendered warrants) having an aggregate fair market value equal to the exercise price for the
total number of warrants to be exercised (or the exercised warrants). The U.S. holder would recognize capital gain or loss in an amount
equal to the difference between the fair market value of the surrendered warrants and the U.S. holder’s adjusted tax basis in such
warrants. Such gain or loss would be long-term or short-term, depending on the U.S. holder's holding period in the surrendered warrants.
In this case, a U.S. holder's tax basis in the shares of common stock received would equal the sum of the U.S. holder's tax basis in the
exercised warrants (i.e., the portion of the U.S. holder's purchase price for the units that is allocated to the warrants, as described
above under “— Allocation of Purchase Price and Characterization of a Unit”) and the exercise price of such exercised
warrants. It is unclear whether a U.S. holder's holding period for the common stock would commence on the date following the date of exercise
or on the date of exercise of the warrants; in either case, the holding period would not include the period during which the U.S. holder
held the warrants.
Due to the absence of authority on the U.S. federal
income tax treatment of a cashless exercise, including when a U.S. holder’s holding period would commence with respect to the common
stock received, there can be no assurance that any of the alternative tax consequences and holding periods described above would be adopted
by the IRS or a court of law. Accordingly, U.S. holders should consult their tax advisors regarding the tax consequences of a cashless
exercise.
If we redeem warrants
for cash or if we purchase warrants in an open market transaction, such redemption or purchase generally will be treated as a taxable
disposition to the U.S. holder, taxed as described above under “— Gain or Loss on Sale, Taxable Exchange or Other Taxable
Disposition of Common Stock and Warrants.” The tax consequences of an exercise of a warrant occurring after our giving notice of
an intention to redeem the warrants as described in the section of this prospectus entitled “Description of Securities -
Warrants - Public Warrants” are unclear under current law. In the case of a cashless exercise, the exercise may be treated either
as if we redeemed such warrant for common stock or as an exercise of the warrant. If the cashless exercise of a warrant for common stock
is treated as a redemption, then such redemption generally should be treated as a tax-deferred recapitalization for U.S. federal income
tax purposes, in which case a U.S. holder should not recognize any gain or loss on such redemption, and accordingly, a U.S. holder's basis
in the common stock received should equal the U.S. holder's basis in the warrant and the holding period of the shares of common stock
would include the holding period of the warrant. If the cashless exercise of a warrant is treated as such, the tax consequences generally
should be as described under the heading “U.S. Holders - Exercise, Lapse or Redemption of a Warrant.” In the case of
an exercise of a warrant for cash, the tax treatment generally should be as described above in the first paragraph under the heading “U.S.
Holders - Exercise, Lapse or Redemption of a Warrant.” Due to the lack of clarity under current law regarding the treatment
of an exercise of a warrant after our giving notice of an intention to redeem the warrant, there can be no assurance as to which, if any,
of the alternative tax consequences described above would be adopted by the IRS or a court of law. Accordingly, U.S. holders should consult
their tax advisors regarding the tax consequences of the exercise of a warrant occurring after our giving notice of an intention to redeem
the warrant as described above.
Possible Constructive Distributions
The terms of each warrant
provide for an adjustment to the number of shares of common stock for which the warrant may be exercised or to the exercise price of the
warrant in certain events, as discussed in the section of this prospectus entitled “Description of Securities — Warrants
– Public Warrants.” An adjustment that has the effect of preventing dilution generally is not taxable. The U.S. holders
of the warrants would, however, be treated as receiving a constructive distribution from us if, for example, the adjustment to the number
of such shares or to such exercise price increases the warrant holders’ proportionate interest in our assets or earnings and profits
(e.g., through an increase in the number of shares of common stock that would be obtained upon exercise or through a decrease in the exercise
price of the warrant) as a result of a distribution of cash or other property, such as other securities, to the holders of shares of our
common stock, or as a result of the issuance of a stock dividend to holders of shares of our common stock, in each case that is taxable
to the U.S. holders of such shares as a distribution (as described under “U.S. Holders — Taxation of Distributions”
above). Such constructive distribution would be subject to tax as described under that section in the same manner as if the U.S.
holders of the warrants received a cash distribution from us equal to the fair market value of such increased interest.
Information Reporting and Backup Withholding
In general, information reporting requirements
may apply to dividends paid to a U.S. holder and to the proceeds of the sale or other disposition of our units, shares of common stock
and warrants, unless the U.S. holder is an exempt recipient. Backup withholding may apply to such payments if the U.S. holder fails to
provide a taxpayer identification number, a certification of exempt status or has been notified by the IRS that it is subject to backup
withholding (and such notification has not been withdrawn).
Backup withholding is not an additional tax. Any
amounts withheld under the backup withholding rules will be allowed as a refund or a credit against a U.S. holder’s U.S. federal
income tax liability provided the required information is timely furnished to the IRS. All U.S. holders should consult their tax advisors
regarding the application of information reporting and backup withholding to them.
Non-U.S. Holders
This section applies
to you if you are a “Non-U.S. holder.” As used herein, the term “Non-U.S. holder” means a beneficial owner of
our units, common stock or warrants who or that is an individual, corporation, estate or trust and is not a U.S. holder. A “Non-U.S.
holder” generally does not include an individual who is present in the United States for 183 days or more in the taxable year
of disposition. If you are such an individual, you should consult your tax advisor regarding the U.S. federal income tax consequences
of the acquisition, ownership and sale or other disposition of our securities.
Taxation of Distributions
In general, any distributions (including constructive
distributions) we make to a Non-U.S. holder of shares of our common stock, to the extent paid out of our current or accumulated earnings
and profits (as determined under U.S. federal income tax principles), will constitute dividends for U.S. federal income tax purposes.
Provided such dividends are not effectively connected with the Non-U.S. holder’s conduct of a trade or business within the
United States (and are not attributable to a U.S. permanent establishment under an applicable treaty), we will be required to withhold
tax from the gross amount of the dividend at a rate of 30%, unless such Non-U.S. holder is eligible for a reduced rate of withholding
tax under an applicable income tax treaty and provides proper certification of its eligibility for such reduced rate (usually on an IRS
Form W-8BEN or W-8BEN-E, as applicable). In the case of any constructive dividend, it is possible that this tax would be withheld
from any amount owed to a Non-U.S. holder by the applicable withholding agent, including cash distributions on other property or sale
proceeds from warrants or other property subsequently paid or credited to such holder. Any distribution not constituting a dividend will
be treated first as reducing (but not below zero) the Non-U.S. holder’s adjusted tax basis in its shares of our common stock and,
to the extent such distribution exceeds the Non-U.S. holder’s adjusted tax basis, as gain realized from the sale or other disposition
of the common stock, which will be treated as described under “Non-U.S. Holders — Gain on Sale, Taxable Exchange or Other
Taxable Disposition of Common Stock and Warrants” below. In addition, if we determine that we are likely to be classified as a “U.S.
real property holding corporation” (see “Non-U.S. Holders — Gain on Sale, Taxable Exchange or Other Taxable
Disposition of Common Stock and Warrants” below), we will withhold 15% of any distribution that exceeds our current and accumulated
earnings and profits, including a distribution in redemption of shares of our common stock. See also “Non-U.S. Holders — Possible
Constructive Distributions” for potential U.S. federal tax consequences with respect to constructive distributions.
Dividends we pay to a Non-U.S. holder that are
effectively connected with such Non-U.S. holder's conduct of a trade or business within the United States (or, if an income tax treaty
applies, are attributable to a U.S. permanent establishment or fixed base maintained by the Non-U.S. holder) will generally not be subject
to withholding tax, provided such Non-U.S. holder complies with certain certification and disclosure requirements (usually by providing
an IRS Form W-8ECI). Instead, such dividends will generally be subject to regular U.S. federal income tax as if the Non-U.S.
holder were a U.S. resident, subject to an applicable income tax treaty providing otherwise. A Non-U.S. corporation receiving effectively
connected dividends may also be subject to an additional "branch profits tax" imposed at a rate of 30% (or a lower treaty rate).
Gain on Sale, Taxable Exchange or Other
Taxable Disposition of Common Stock and Warrants
Subject to the discussion of FATCA and backup
withholding below, a Non-U.S. holder generally will not be subject to U.S. federal income or withholding tax in respect of gain recognized
on a sale, taxable exchange or other taxable disposition of our common stock, which would include a dissolution and liquidation in the
event we do not complete our initial business combination within the required period of time, or warrants (including an expiration or
redemption of our warrants), in each case without regard to whether those securities were held as part of a unit, unless:
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the gain is effectively connected with the conduct of a trade or business by the Non-U.S. holder within the United States (and, under certain income tax treaties, is attributable to a United States permanent establishment or fixed base maintained by the Non-U.S. holder); or
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we are or have been a “U.S. real property holding corporation” for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of disposition or the period that the Non-U.S. holder held our common stock, and, in the case where shares of our common stock are regularly traded on an established securities market, the Non-U.S. holder has owned, directly or constructively (including through ownership of warrants), more than 5% of our common stock at any time within the shorter of the five-year period preceding the disposition or such Non-U.S. holder’s holding period for the shares of our common stock. There can be no assurance that our common stock will be treated as regularly traded on an established securities market for this purpose.
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Unless an applicable income tax treaty provides
otherwise, gain described in the first bullet point above will be subject to tax at generally applicable U.S. federal income tax rates
as if the Non-U.S. holder were a U.S. resident. Any gains described in the first bullet point above of a Non-U.S. holder that is a foreign
corporation may also be subject to an additional “branch profits tax” at a 30% rate (or lower treaty rate).
If the second bullet point above applies to a
Non-U.S. holder, gain recognized by such holder on the sale, exchange or other disposition of our common stock or warrants will be subject
to tax at generally applicable U.S. federal income tax rates. In addition, if our common stock will not be treated as regularly traded
on an established securities market, a buyer of our common stock or warrants from such holder may be required to withhold U.S. federal
income tax at a rate of 15% of the amount realized upon such disposition. We cannot determine whether we will be a U.S. real property
holding corporation in the future until we complete our initial business combination. We will be classified as a U.S. real property holding
corporation if the fair market value of our “U.S. real property interests” equals or exceeds 50 percent of the sum of the
fair market value of our worldwide real property interests plus our other assets used or held for use in a trade or business, as determined
for U.S. federal income tax purposes.
Redemption of Common Stock
The characterization for U.S. federal income tax
purposes of the redemption of a Non-U.S. holder’s common stock pursuant to the redemption provisions described in the section
of this prospectus entitled “Description of Securities — Common Stock” generally will correspond to the U.S.
federal income tax characterization of such a redemption of a U.S. holder’s common stock, as described under “U.S. Holders —
Redemption of Common Stock” above, and the consequences of the redemption to the Non-U.S. holder will be as described above
under “Non-U.S. Holders — Taxation of Distributions” and “Non-U.S. Holders — Gain on
Sale, Taxable Exchange or Other Taxable Disposition of Common Stock and Warrants,” as applicable.
Exercise, Lapse or Redemption of a Warrant
The U.S. federal income tax treatment of a Non-U.S.
holder’s exercise of a warrant, or the lapse of a warrant held by a Non-U.S. holder, generally will correspond to the U.S. federal
income tax treatment of the exercise or lapse of a warrant by a U.S. holder, as described under “U.S. Holders — Exercise,
Lapse or Redemption of a Warrant” above, although to the extent a cashless exercise results in a taxable exchange, the consequences
would be similar to those described above in “Non-U.S. Holders — Gain on Sale, Taxable Exchange or Other Taxable Disposition
of Common Stock and Warrants.” The U.S. federal income tax treatment for a Non-U.S. holder of a redemption of warrants for common
stock will correspond to the U.S. federal income tax treatment for a U.S. holder of a redemption of warrants for common stock, as described
above in “U.S. Holders — Exercise, Lapse or Redemption of a Warrant.” The U.S. federal income tax treatment for
a Non-U.S. holder of a redemption of warrants for cash (or if we purchase warrants in an open market transaction) would be similar to
that described above under “Non-U.S. Holders — Gain on Sale, Taxable Exchange or Other Taxable Disposition of Common Stock
and Warrants.”
Possible Constructive Distributions
The terms of each warrant provide for an adjustment
to the number of shares of common stock for which the warrant may be exercised or to the exercise price of the warrant in certain events,
as discussed in the section of this prospectus entitled “Description of Securities — Warrants – Public Warrants.”
An adjustment that has the effect of preventing dilution generally is not taxable. Nevertheless, the Non-U.S. holders of the warrants
would be treated as receiving a constructive distribution from us if, for example, the adjustment to the number of such shares or to such
exercise price increases the warrant holders’ proportionate interest in our assets or earnings and profits (e.g., through an increase
in the number of shares of common stock that would be obtained upon exercise or through a decrease in the exercise price of the warrant)
as a result of a distribution of cash or other property, such as other securities, to the holders of shares of our common stock, or as
a result of the issuance of a stock dividend to holders of shares of our common stock, in each case that is taxable to the holders of
such shares as a distribution (as described under “Non-U.S. Holders — Taxation of Distributions” above). Such constructive
distribution would be subject to U.S. federal income tax (including any applicable withholding) in the same manner as if the Non-U.S.
holders of the warrants received a cash distribution from us equal to the fair market value of such increased interest resulting from
the adjustment without any corresponding receipt of cash.
Information Reporting and Backup Withholding
Information returns will be filed with the IRS
in connection with payments of dividends and the proceeds from a sale or other disposition of our units, shares of common stock and warrants.
A Non-U.S. holder may have to comply with certification procedures to establish that it is not a United States person in order to
avoid information reporting and backup withholding requirements. The certification procedures required to claim a reduced rate of withholding
under a treaty generally will satisfy the certification requirements necessary to avoid the backup withholding as well.
Backup withholding is not an additional tax. The
amount of any backup withholding from a payment to a Non-U.S. holder will be allowed as a credit against such holder’s U.S. federal
income tax liability and may entitle such holder to a refund, provided, that the required information is timely furnished to the IRS.
All Non-U.S. holders should consult their tax advisors regarding the application of information reporting and backup withholding to them.
FATCA Withholding Taxes
Provisions commonly referred to as “FATCA”
impose withholding of 30% on payments of dividends (including constructive dividends) on our common stock or warrants to “foreign financial
institutions” (which is broadly defined for this purpose and in general includes investment vehicles) and certain other non-U.S.
entities unless various U.S. information reporting and due diligence requirements (generally relating to ownership by U.S. persons
of interests in or accounts with those entities) have been satisfied by, or an exemption applies to, the payee (typically certified
as to by the delivery of a properly completed IRS Form W-8BEN-E). The IRS has issued proposed regulations (on which taxpayers
may rely until final regulations are issued) that would generally not apply these withholding requirements to gross proceeds from sales
or other disposition proceeds from our securities. Foreign financial institutions located in jurisdictions that have an intergovernmental
agreement with the United States governing FATCA may be subject to different rules. Under certain circumstances, a Non-U.S. holder
might be eligible for refunds or credits of such withholding taxes, and a Non-U.S. holder might be required to file a U.S. federal
income tax return to claim such refunds or credits. Prospective investors should consult their tax advisers regarding the effects
of FATCA on their investment in our securities.
THE U.S. FEDERAL INCOME TAX DISCUSSION SET FORTH
ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A HOLDER’S PARTICULAR SITUATION. HOLDERS
ARE URGED TO CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE ACQUISITION, OWNERSHIP AND DISPOSITION
OF OUR COMMON STOCK AND WARRANTS, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, ESTATE, NON-U.S. AND OTHER TAX LAWS AND TAX
TREATIES AND THE POSSIBLE EFFECTS OF CHANGES IN U.S. OR OTHER TAX LAWS.
UNDERWRITING – CONFLICTS OF INTEREST
The representative is acting as the sole book-running
manager of the offering and as representative of the underwriters named below. Subject to the terms and conditions of the underwriting
agreement dated the date of this prospectus, the underwriters named below, through the representative, have severally agreed to purchase,
and we have agreed to sell to the underwriters, the following respective number of units set forth opposite the underwriter’s name.
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Underwriters
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Number
of Units
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A.G.P./Alliance Global Partners
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10,000,000
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Brookline Capital Markets, a division of Arcadia Securities, LLC
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Total
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10,000,000
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The underwriting agreement provides that the obligations
of the underwriters to purchase the units included in this offering are subject to approval of legal matters by counsel and to other conditions.
The underwriters are obligated to purchase all of the units (other than those covered by the over-allotment option described below) if
they purchase any of the units.
Units sold by the underwriters to the public
will initially be offered at the initial public offering price set forth on the cover of this prospectus. Any units sold by the underwriters
to securities dealers may be sold at a discount from the initial public offering price not to exceed $0.05 per unit. If not all of the
units are sold at the initial offering price, the underwriters may change the offering price and the other selling terms. The underwriters
have advised us that they do not intend to make sales to discretionary accounts.
If the underwriters sell more units than the
total number set forth in the table above, we have granted to the underwriters an option, exercisable for 45 days from the date
of this prospectus, to purchase up to 1,150,000 additional units at the public offering price less the underwriting discount. The underwriters
may exercise this option solely for the purpose of covering over-allotments, if any, in connection with this offering. Any units issued
or sold under the option will be issued and sold on the same terms and conditions as the other units that are the subject of this offering.
We,
our initial stockholders, and our officers and directors have agreed that, for a period of 180 days from the date of this prospectus,
we and they will not, without the prior written consent of the representative, sell, offer to sell, contract or agree to sell, hypothecate,
pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish or increase
a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Exchange Act
with respect to any units, shares of common stock, warrants or any securities convertible into, or exercisable, or exchangeable for, shares
of common stock, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of any units, shares of common stock, warrants or any securities convertible into, or exercisable, or exchangeable
for, shares of common stock, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (iii) publicly
announce any intention to effect any transaction specified in clause (i) or (ii), subject to certain exceptions. The representative
in its sole discretion may release any of the securities subject to the lock-up agreement at any time without notice, other than in the
case of the officers and directors, which shall be with notice. Our initial stockholders, officers, and directors are also subject to
separate transfer restrictions on their founder shares and placement units pursuant to the letter agreements as described herein.
Our initial stockholders have agreed not to transfer,
assign or sell any of their founder shares (or shares of common stock issuable upon conversion thereof) until the earlier to occur of:
(A) one year after the completion of our initial business combination; and (B) subsequent to our initial business combination, if
the reported last sale price of our common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations,
recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after our initial business combination
(except with respect to permitted transferees as described herein under the section of this prospectus entitled “Principal Stockholders”).
The placement units, placement shares and placement warrants (including the common stock issuable upon exercise of the placement warrants)
will not be transferable, assignable or salable until 30 days after the completion of our initial business combination (except with
respect to permitted transferees as described herein under the section of this prospectus entitled “Principal Stockholders”).
Prior to this offering, there has been no public
market for our securities. Consequently, the initial public offering price for the units was determined by negotiations between us and
the underwriters. Among the factors considered in determining the initial public offering price were the history and prospects of companies
whose principal business is the acquisition of other companies, prior offerings of those companies, our management, our capital structure,
and currently prevailing general conditions in the equity securities markets, including current market valuations of publicly traded companies
considered comparable to our company. We cannot assure you, however, that the price at which the units, common stock or warrants will
sell in the public market after this offering will not be lower than the initial public offering price or that an active trading market
in our units, common stock or warrants will develop and continue after this offering.
We have applied to list our units on Nasdaq under
the symbol “WAVSU” We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect that our units
will be listed on Nasdaq on or promptly after the date of this prospectus. We expect that our common stock and warrants will be listed
under the symbols “WAVS” and “WAVSW,” respectively, once the common stock and warrants begin separate trading.
The following table shows the underwriting
cash discounts and commissions that we are to pay to the underwriters in connection with this offering (but does not reflect the transfer
of 750,000 common shares (up to 97,826 shares of which are subject to forfeiture to the extent that the underwriters’ over-allotment
option is not exercised in full or in part) for $6,522 to an affiliate of AGP as additional underwriting compensation). These amounts
are shown assuming both no exercise and full exercise of the underwriters’ over-allotment option. The cash component of the upfront
portion of the underwriting discounts and commissions will be $0.05 per unit.
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Payable
by Western Acquisition Ventures Corp.
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No Exercise
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Full
Exercise
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Per Unit(1)
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$
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0.05
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$
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0.05
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Total(1)
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$
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500,000
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$
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500,000
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(1) Includes $0.05 per unit, or $500,000,
to be paid in cash at the closing of the offering. We have engaged the representatives as advisors in connection with our business combination.
We will pay the representatives in cash or stock for such services upon the consummation of our initial business combination in an amount
equal to 4.5% of the gross proceeds of this offering, or $4,500,000 (or $5,175,000 if the over-allotment option is exercised in full)
in the aggregate, exclusive of any applicable finders’ fees which might become payable. If we do not complete our initial business
combination and subsequently liquidate, the underwriters have agreed that (i) they will forfeit any rights or claims to the fees
payable under the business combination marketing agreement, including any accrued interest thereon, then in the trust account upon liquidation;
and (ii) that such fees will be distributed on a pro rata basis, including interest earned on the funds held in the trust account
and not previously released to us to pay our taxes to the public stockholders. Also includes $100,000 payable to The Benchmark Company,
LLC, for acting as a “qualified independent underwriter” as defined by the FINRA rules as described herein. In addition,
our sponsor has previously transferred to an affiliate of A.G.P. 750,000 founder shares for $6,522, of which 97,826 will be forfeited
if the over-allotment option is not exercised.
In addition to the underwriting discount, we have
agreed to pay or reimburse the underwriters for reimbursement of the expenses of background checks on our directors and executive officers,
the reasonable fees of counsel of the Underwriters and other expenses incurred by the Representative in an amount not to exceed $150,000.
Representative Shares
As an additional underwriting fee, our sponsor
has previously transferred to an affiliate of A.G.P. 750,000 common shares (up to 97,826 shares of which are subject to forfeiture to
the extent that the underwriters’ over-allotment option is not exercised in full or in part) for $6,522. The representative
has agreed not to transfer, assign, or sell any of the representative shares without our prior consent until the completion of our initial
business combination. In addition, the representative has agreed (i) to waive its redemption rights (or right to participate in
any tender offer) with respect to the representative shares in connection with the completion of our initial business combination and
(ii) to waive their rights to liquidating distributions from the trust account with respect to the representative shares if we fail
to complete our initial business combination within 12 months (or up to 18 months, if extended) from the closing of this offering.
The representative shares have been deemed compensation
by FINRA and are therefore subject to a lock-up for a period of 180 days immediately following the date of the effectiveness of the
registration statement of which this prospectus forms a part pursuant to Rule 5110(e)(1) of the FINRA Manual. Pursuant to FINRA
Rule 5110(e)(1), these securities will not be sold during the offering, or sold, transferred, assigned, pledged, or hypothecated,
or be the subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the
securities by any person for a period of 180 days immediately following the effective date of the registration statement of which this
prospectus forms a part or commencement of sales of the public offering, except to any underwriter and selected dealer participating in
the offering and their bona fide officers or partners, provided that all securities so transferred remain subject to the lockup restriction
above for the remainder of the time period.
We have granted the holders of the representative
shares the registration rights as described under the section “Shares Eligible for Future Sale — Registration Rights.”
Notwithstanding anything to the contrary, under FINRA Rule 5110(g)(8), the underwriters and/or their designees may only make a demand
registration on one occasion during the five-year period beginning on the effective date of the registration statement of which this prospectus
is a part, and the underwriters and/or their designees may participate in a “piggy-back” registration only during the seven-year
period beginning on the effective date of the registration statement of which this prospectus is a part.
Initial Business Combination Agreement
We have agreed to engage A.G.P. as an advisor
in connection with our initial business combination to assist us in holding meetings with our stockholders to discuss the potential initial
business combination and the target business’ attributes, introduce us to potential investors that are interested in purchasing
our securities in connection with our initial business combination, assist us in obtaining stockholder approval for the initial business
combination and assist us with our press releases and public filings in connection with the initial business combination. We will pay
A.G.P. a fee for such marketing services upon the consummation of our initial business combination in an amount equal to 4.5% of the gross
proceeds of this offering. Pursuant to the terms of the initial business combination marketing agreement, no fee will be due if we do
not complete our initial business combination.
Stabilization
In connection with the offering, the underwriters
may purchase and sell units in the open market. Purchases and sales in the open market may include short sales, purchases to cover short
positions, which may include purchases pursuant to the over-allotment option and stabilizing purchases, in accordance with Regulation
M under the Exchange Act.
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Short sales involve secondary market sales by the underwriters of a greater number of units than it is required to purchase in the offering.
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“Covered” short sales are sales of units in an amount up to the number of units represented by the underwriters’ over-allotment option.
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“Naked” short sales are sales of units in an amount in excess of the number of units represented by the underwriters’ over-allotment option.
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Covering transactions involve purchases of units either pursuant to the over-allotment option or in the open market after the distribution has been completed in order to cover short positions.
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To close a naked short position, the underwriters must purchase units in the open market after the distribution has been completed. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the units in the open market after pricing that could adversely affect investors who purchase in the offering.
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To close a covered short position, the underwriters must (i) purchase units in the open market after the distribution has been completed or (ii) exercise the over-allotment option. In determining the source of units to close the covered short position, the underwriters will consider, among other things, the price of units available for purchase in the open market as compared to the price at which they may purchase units through the over-allotment option.
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Stabilizing transactions involve bids to purchase units so long as the stabilizing bids do not exceed a specified maximum.
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Purchases to cover short positions and stabilizing
purchases, as well as other purchases by the underwriters for their own account, may have the effect of preventing or retarding a decline
in the market price of the units. They may also cause the price of the units to be higher than the price that would otherwise exist in
the open market in the absence of these transactions. The underwriters may conduct these transactions in the over-the-counter market or
otherwise. If the underwriters commence any of these transactions, it may discontinue them at any time.
We estimate that our portion of the total expenses
of this offering payable by us will be $685,000, excluding underwriting discounts and commissions, but including reimbursement to the
underwriters for expenses and fees of up to $150,000.
We have agreed to indemnify A.G.P. against certain liabilities, including
liabilities under the Securities Act, or to contribute to payments the underwriters may be required to make because of any of those liabilities.
In addition, we have agreed to The Benchmark Company, LLC, which is acting as a “qualified independent underwriter”
for this offering, against certain liabilities incurred in connection with acting as qualified independent underwriter, including liabilities
under the Securities Act. See “Conflicts of Interest”, below.
We have agreed to engage A.G.P. as an advisor
in connection with our initial business combination to introduce us to, potential targets businesses, assist us in holding meetings with
our stockholders to discuss the potential initial business combination and the target business’ attributes, introduce us to potential
investors that are interested in purchasing our securities in connection with our initial business combination, assist us in obtaining
stockholder approval for the initial business combination and assist us with our press releases and public filings in connection with
the initial business combination. We are not under any contractual obligation to engage the underwriters to provide any other services
for us after this offering, and have no present intent to do so. If the underwriters provide any such additional services to us after
this offering, we may pay the underwriters fair and reasonable fees that would be determined at that time in an arm’s length negotiation;
provided that no agreement will be entered into with the underwriters and no fees for such services will be paid to the underwriters prior
to the date that is 90 days from the date of this prospectus, unless FINRA determines that such payment would not be deemed underwriters’
compensation in connection with this offering and we may pay the underwriters of this offering or any entity with which it is affiliated
a finder’s fee or other compensation for services rendered to us in connection with the completion of our initial business combination.
The underwriters and their affiliates may in the
future engage in, investment banking and other commercial dealings in the ordinary course of business with us or our affiliates, for which
it may in the future receive, customary fees and commissions for any such transactions.
The underwriters and their respective affiliates
are financial institutions engaged in various activities, which may include, among other things, securities trading, commercial and investment
banking, financial advisory, investment management, financing and brokerage activities. Such underwriters and their affiliates have in
the past, in the ordinary course of business, provided certain of these services to affiliates of our sponsor, and have arrangements in
place whereby they may currently or in the future provide such services to affiliates of our sponsor, for which they have received and
may receive customary fees, interest, commissions and other compensation.
In addition, in the ordinary course of their business
activities, the underwriters and their affiliates may make or hold a broad array of investments and actively trade debt and equity securities
(or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their
customers. Such investments and securities activities may involve our or our affiliates’ securities and/or instruments. The underwriters
and their affiliates may also make investment recommendations and/or publish or express independent research views in respect of such
securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities
and instruments.
A prospectus in electronic format may be made
available by e-mail, on our website, and/or through online services maintained by one or more of the underwriters or their affiliates.
In those cases, prospective investors may view offering terms online and may be allowed to place orders online. The underwriters may agree
with us to allocate a specific number of common shares for sale to online brokerage account holders. Any such allocation for online distributions
will be made by the underwriters on the same basis as other allocations. Other than the prospectus in electronic format, the information
on the underwriters’ web sites and any information contained in any other web site maintained by any of the underwriters is not
part of this prospectus, has not been approved and/or endorsed by us or the underwriters and should not be relied upon by investors.
Conflicts of Interest
A.G.P. has a “conflict of interest” within the meaning
of FINRA Rule 5121(f)(5)(B) in this offering because one of its affiliates beneficially owns more than 10% of our shares. Accordingly,
this offering is being made in compliance with the applicable requirements of FINRA Rule 5121. FINRA Rule 5121 requires that
a “qualified independent underwriter,” as defined in FINRA Rule 5121, participate in the preparation of this prospectus
and the registration statement of which it forms a part and exercise the usual standards of “due diligence” with respect thereto.
The Benchmark Company, LLC has agreed to act as a “qualified independent underwriter” for this offering. The Benchmark Company,
LLC will receive $100,000 (such amount to be deducted from the underwriters’ commissions) for acting as a qualified independent
underwriter. We have agreed to indemnify The Benchmark Company, LLC against certain liabilities incurred in connection with acting as qualified
independent underwriter, including liabilities under the Securities Act. In addition, no underwriter with a conflict of interest will
confirm sales to any account over which it exercises discretionary authority without the specific prior written approval of the account
holder.
Selling Restrictions
This prospectus does not constitute an offer to
sell to, or a solicitation of an offer to buy from, anyone in any country or jurisdiction (i) in which such an offer or solicitation
is not authorized, (ii) in which any person making such offer or solicitation is not qualified to do so or (iii) in which any
such offer or solicitation would otherwise be unlawful. No action has been taken that would, or is intended to, permit a public offer
of the units or possession or distribution of this prospectus or any other offering or publicity material relating to the units
in any country or jurisdiction (other than the United States) where any such action for that purpose is required. Accordingly, each underwriter
has undertaken that it will not, directly or indirectly, offer or sell any units or have in its possession, distribute or publish
any prospectus, form of application, advertisement or other document or information in any country or jurisdiction except under circumstances
that will, to the best of its knowledge and belief, result in compliance with any applicable laws and regulations and all offers and sales
of units by it will be made on the same terms.
Notice to Prospective Investors in the European Economic Area
and the United Kingdom
In
relation to each member state of the European Economic Area and the United Kingdom, each, a relevant state, no units have been offered
or will be offered pursuant to the offering to any retail investor (having the meaning has given to it in Regulation (EU) No 1286/2014,
as amended) in that relevant state prior to the publication of a prospectus in relation to the units that has been approved by the competent
authority in that relevant state or, where appropriate, approved in another relevant state and notified to the competent authority in
that relevant state, all in accordance with the Prospectus Regulation, except that offers of our units may be made to the public in that
relevant state at any time under the following exemptions under the Prospectus Regulation:
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to any legal entity that is a qualified investor as defined under the Prospectus Regulation;
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to fewer than 150 natural or legal persons (other than qualified investors as defined under the Prospectus Regulation),
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subject to obtaining the prior consent of the representative for any such offer; or
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in any other circumstances falling within Article 1(4) of the Prospectus Regulation;
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provided, that, no such offer of units shall require
the issuer or the representative to publish a prospectus pursuant to Article 3 of the Prospectus Regulation or supplement a prospectus
pursuant to Article 23 of the Prospectus Regulation.
Each person in a relevant state who initially
acquires any units, or to whom any offer is made, will be deemed to have represented, acknowledged, and agreed to and with us and the
representative that it is a qualified investor within the meaning of the Prospectus Regulation.
In the case of any units being offered to a financial
intermediary as that term is used in Article 5(1) of the Prospectus Regulation, each such financial intermediary will be deemed
to have represented, acknowledged and agreed that the units acquired by it in the offer have not been acquired on a non-discretionary
basis on behalf of, nor have they been acquired with a view to their offer or resale to, persons in circumstances that may give rise to
an offer to the public other than their offer or resale in a relevant state to qualified investors, in circumstances in which the prior
consent of the representative has been obtained to each such proposed offer or resale.
We, the representative, and each of our and the
representative’s respective affiliates will rely upon the truth and accuracy of the foregoing representations, acknowledgements
and agreements.
For the purposes of this provision, the expression
an “offer to the public” in relation to any units in any relevant state means the communication in any form and by any means
of sufficient information on the terms of the offer and any units to be offered so as to enable an investor to decide to purchase or subscribe
for any units, and the expression “Prospectus Regulation” means Regulation (EU) 2017/1129.
References to the Prospectus Regulation include,
in relation to the United Kingdom, the Prospectus Regulation as it forms part of United Kingdom domestic law by virtue of the
European Union (Withdrawal) Act 2018.
The above selling restriction is in addition to
any other selling restrictions set out below.
In connection with the offering, the representative
is not acting for anyone other than the issuer and will not be responsible to anyone other than the issuer for providing the protections
afforded to its clients nor for providing advice in relation to the offering.
Notice to Prospective Investors in the United Kingdom
This prospectus is for distribution only to persons
who (i) have professional experience in matters relating to investments and who qualify as investment professionals within the meaning
of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the “Financial
Promotion Order”), (ii) are persons falling within Article 49(2)(a) to (d), or high net worth companies, unincorporated
associations etc., of the Financial Promotion Order, (iii) are outside the United Kingdom, or (iv) are persons to whom
an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets
Act 2000, as amended, or the FSMA) in connection with the issue or sale of any securities may otherwise lawfully be communicated or caused
to be communicated (all such persons together being referred to as “relevant persons”). This document is directed only at
relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity
to which this document relates is available only to relevant persons and will be engaged in only with relevant persons.
Notice to Prospective Investors in France
Neither this prospectus nor any other offering
material relating to the units described in this prospectus has been submitted to the clearance procedures of the Autorité des
Marchés Financiers or of the competent authority of another member state of the European Economic Area and notified to the Autorité
des Marchés Financiers. The units have not been offered or sold and will not be offered or sold, directly or indirectly, to the
public in France. Neither this prospectus nor any other offering material relating to the units has been or will be:
|
|
·
|
released, issued, distributed or caused to be released, issued or distributed to the public in France; or
|
|
|
·
|
used in connection with any offer for subscription or sale of the units to the public in France.
|
Such offers, sales and distributions will be made
in France only:
|
|
·
|
To qualified investors (investisseurs qualifiés) and/or to a restricted circle of investors (cercle restreint d’investisseurs),
|
|
|
·
|
in each case investing for their own account, all as defined in, and in accordance with, articles L.411-2, D.411-1,
|
|
|
·
|
D.411-2, D.734-1, D.744-1, D.754-1 and D.764-1 of the French Code monétaire et financier;
|
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|
·
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to investment services providers authorized to engage in portfolio management on behalf of third parties; or
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·
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in a transaction that, in accordance with article L.411-2-II-1° -or-2° -or 3° of the French Code monétaire et financier
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|
·
|
and article 211-2 of the General Regulations (Règlement Général) of the Autorité des Marchés Financiers, does not
|
|
|
·
|
constitute a public offer (appel public à l’épargne).
|
The units may be resold directly or indirectly,
only in compliance with articles L.411-1, L.411-2, L.412-1 and L.621-8 through L.621-8-3 of the French Code monétaire et financier.
Notice to Prospective Investors in Hong Kong
The units have not been offered or sold and will
not be offered or sold in Hong Kong, by means of any document, other than (a) to “professional investors” as defined
in the Securities and Futures Ordinance (Chapter 71) of Hong Kong and any rules made under that Ordinance; or (b) in other circumstances
that do not result in the document being a “prospectus” as defined in the Companies Ordinance (Chapter 32) of Hong Kong or
that do not constitute an offer to the public within the meaning of that Ordinance. No advertisement, invitation or document relating
to the units has been or may be issued or has been or may be in the possession of any person for the purposes of issue, whether in Hong
Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except
if permitted to do so under the securities laws of Hong Kong) other than with respect to units that are or are intended to be disposed
of only to persons outside Hong Kong or only to “professional investors” as defined in the Securities and Futures Ordinance
and any rules made under that Ordinance.
Notice to Prospective Investors in Japan
The units have not been and will not be registered
under the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948, as amended) and, accordingly, will not be offered
or sold, directly or indirectly, in Japan, or for the benefit of any Japanese Person or to others for re-offering or resale, directly
or indirectly, in Japan or to any Japanese Person, except in compliance with all applicable laws, regulations and ministerial guidelines
promulgated by relevant Japanese governmental or regulatory authorities in effect at the relevant time. For the purposes of this paragraph,
“Japanese Person” shall mean any person resident in Japan, including any corporation or other entity organized under the laws
of Japan.
Notice to Prospective Investors in Singapore
This prospectus has not been registered as a prospectus
with the Monetary Authority of Singapore. Accordingly, the units were not offered or sold or caused to be made the subject of an invitation
for subscription or purchase and will not be offered or sold or caused to be made the subject of an invitation for subscription or purchase,
and this prospectus or any other document or material in connection with the offer or sale, or invitation for subscription or purchase,
of the units, has not been circulated or distributed, nor will it be circulated or distributed, whether directly or indirectly, to any
person in Singapore other than (i) to an institutional investor (as defined in Section 4A of the Securities and Futures Act
(Chapter 289) of Singapore, as modified or amended from time to time, or the SFA, pursuant to Section 274 of the SFA, (ii) to
a relevant person (as defined in Section 275(2) of the SFA) pursuant to Section 275(1) of the SFA, or any person pursuant
to Section 275(1A) of the SFA, and in accordance with the conditions specified in Section 275 of the SFA, or (iii) otherwise
pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.
Where the units are subscribed or purchased under
Section 275 of the SFA by a relevant person that is:
|
|
(a)
|
a corporation (that is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or
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|
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(b)
|
a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor,
|
securities or securities-based derivatives contracts
(each term as defined in Section 2(1) of the SFA) of that corporation or the beneficiaries’ rights and interest (howsoever
described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the units pursuant
to an offer made under Section 275 of the SFA except:
|
|
(a)
|
to an institutional investor or to a relevant person, or to any person arising from an offer referred to in Section 275(1A) or Section 276(4)(i)(B) of the SFA;
|
|
|
(b)
|
where no consideration is or will be given for the transfer;
|
|
|
(c)
|
where the transfer is by operation of law; or
|
|
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(d)
|
as specified in Section 276(7) of the SFA.
|
Notice to Prospective Investors in Canada
The units may be sold in Canada only to purchasers
purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus
Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined
in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the
units must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable
securities laws.
Securities legislation in certain provinces or
territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus (including any amendment thereto)
contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit
prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable
provisions of the securities legislation of the purchaser’s province or territory for particulars of these rights or consult with
a legal advisor.
Pursuant to section 3A.3 (or, in the case of securities
issued or guaranteed by the government of a non-Canadian jurisdiction, section 3A.4) of National Instrument 33-105 Underwriting
Conflicts (NI 33-105), the underwriters are not required to comply with the disclosure requirements of NI 33-105 regarding underwriter
conflicts of interest in connection with this offering.
Notice to Prospective Investors in the Dubai International Financial
Centre
This prospectus relates to an Exempt Offer in
accordance with the Offered Securities Rules of the Dubai Financial Services Authority or DFSA. This prospectus is intended for distribution
only to persons of a type specified in the Offered Securities Rules of the DFSA. It must not be delivered to, or relied on by, any
other person. The DFSA has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA has not
approved this prospectus nor taken steps to verify the information set forth herein and has no responsibility for the prospectus. The
securities to which this prospectus relates may be illiquid and/or subject to restrictions on their resale.
Prospective purchasers of the securities offered
should conduct their own due diligence on the securities. If you do not understand the contents of this prospectus you should consult
an authorized financial advisor.
Notice to Prospective Investors in Australia
No placement document, prospectus, product disclosure
statement or other disclosure document has been lodged with the Australian Securities and Investments Commission or ASIC, in relation
to the offering. This prospectus does not constitute a prospectus, product disclosure statement or other disclosure document under the
Corporations Act 2001 or the Corporations Act, and does not purport to include the information required for a prospectus, product disclosure
statement or other disclosure document under the Corporations Act. Any offer in Australia of the securities may only be made to persons
or the Exempt Investors who are “sophisticated investors” (within the meaning of section 708(8) of the Corporations Act),
“professional investors” (within the meaning of section 708(11) of the Corporations Act) or otherwise pursuant to one or more
exemptions contained in section 708 of the Corporations Act so that it is lawful to offer the securities without disclosure to investors
under Chapter 6D of the Corporations Act.
The securities applied for by Exempt Investors
in Australia must not be offered for sale in Australia in the period of 12 months after the date of allotment under the offering, except
in circumstances where disclosure to investors under Chapter 6D of the Corporations Act would not be required pursuant to an exemption
under section 708 of the Corporations Act or otherwise or where the offer is pursuant to a disclosure document that complies with Chapter
6D of the Corporations Act. Any person acquiring securities must observe such Australian on-sale restrictions. This prospectus contains
general information only and does not take account of the investment objectives, financial situation or particular needs of any particular
person. It does not contain any securities recommendations or financial product advice. Before making an investment decision, investors
need to consider whether the information in this prospectus is appropriate to their needs, objectives and circumstances, and, if necessary,
seek expert advice on those matters.
Notice to Prospective Investors in Switzerland
The securities may not be publicly offered in
Switzerland and will not be listed on the SIX Swiss Exchange or SIX or on any other stock exchange or regulated trading facility in Switzerland.
This document has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the
Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the
listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this document nor any other offering
or marketing material relating to the securities or the offering may be publicly distributed or otherwise made publicly available in Switzerland.
Neither this document nor any other offering or
marketing material relating to the offering, us, the shares have been or will be filed with or approved by any Swiss regulatory authority.
In particular, this document will not be filed with, and the offer of securities will not be supervised by, the Swiss Financial Market
Supervisory Authority FINMA or FINMA, and the offer of securities has not been and will not be authorized under the Swiss Federal Act
on Collective Investment Schemes or CISA. The investor protection afforded to acquirers of interests in collective investment schemes
under the CISA does not extend to acquirers of securities.
Notice to Prospective Investors in Israel
In the State of Israel, this prospectus shall
not be regarded as an offer to the public to purchase securities under the Israeli Securities Law, 5728 – 1968, which requires a
prospectus to be published and authorized by the Israel Securities Authority, if it complies with certain provisions of Section 15
of the Israeli Securities Law, 5728 – 1968, including, inter alia, if: (i) the offer is made, distributed or directed to not
more than 35 investors, subject to certain conditions or Addressed Investors; or (ii) the offer is made, distributed or directed
to certain qualified investors defined in the First Addendum of the Israeli Securities Law, 5728 –1968, subject to certain conditions
or Qualified Investors. The Qualified Investors shall not be taken into account in the count of the Addressed Investors and may be offered
to purchase securities in addition to the 35 Addressed Investors. We have not and will not take any action that would require us to publish
a prospectus in accordance with and subject to the Israeli Securities Law, 5728 – 1968. We have not and will not distribute this
prospectus or make, distribute or direct an offer to subscribe for our securities to any person within the State of Israel, other than
to Qualified Investors and up to 35 Addressed Investors.
Qualified Investors may have to submit written
evidence that they meet the definitions set out in of the First Addendum to the Israeli Securities Law, 5728 – 1968. In particular,
we may request, as a condition to be offered securities, that Qualified Investors will each represent, warrant and certify to us and/or
to anyone acting on our behalf: (i) that it is an investor falling within one of the categories listed in the First Addendum to the
Israeli Securities Law, 5728 – 1968; (ii) those of the categories listed in the First Addendum to the Israeli Securities Law,
5728 – 1968 regarding Qualified Investors is applicable to it; (iii) that it will abide by all provisions set forth in the
Israeli Securities Law, 5728 – 1968 and the regulations promulgated thereunder in connection with the offer to be issued securities;
(iv) that the securities that it will be issued are, subject to exemptions available under the Israeli Securities Law, 5728 –
1968: (a) for its own account; (b) for investment purposes only; and (c) not issued with a view to resale within the State
of Israel, other than in accordance with the provisions of the Israeli Securities Law, 5728 – 1968; and (v) that it is willing
to provide further evidence of its Qualified Investor status. Addressed Investors may have to submit written evidence in respect of their
identity and may have to sign and submit a declaration containing, inter alia, the Addressed Investor’s name, address and passport
number or Israeli identification number.
We have not authorized and do not authorize the
making of any offer of securities through any financial intermediary on our behalf, other than offers made by the underwriters and their
respective affiliates, with a view to the final placement of the securities as contemplated in this document. Accordingly, no purchaser
of the shares, other than the underwriters, is authorized to make any further offer of shares on our behalf or on behalf of the underwriters.
LEGAL MATTERS
Reed Smith LLP, New York, New York, is acting
as our counsel in connection with the registration of our securities under the Securities Act and, as such, will pass upon the validity
of the securities offered in this offering. Sullivan & Worcester LLP, New York, New York is acting as counsel to the underwriters.
EXPERTS
The financial statements of Western
Acquisition Ventures Corp. as of June 16, 2021 and for the period from April 28, 2021 (inception) through June 16, 2021
included in this prospectus have been audited by Marcum LLP, independent registered public accounting firm, as set forth in their
report, thereon (which contains an explanatory paragraph relating to substantial doubt about the ability of Western Acquisition
Ventures Corp. to continue as a going concern as described in Note 1 to the financial statements), appearing elsewhere in this
prospectus, and are included in reliance on such report given upon the authority of such firm as experts in
auditing and accounting.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We have filed with the SEC a registration statement
on Form S-1 under the Securities Act with respect to the securities we are offering by this prospectus. This prospectus does not
contain all of the information included in the registration statement. For further information about us and our securities, you should
refer to the registration statement and the exhibits and schedules filed with the registration statement. Whenever we refer in this prospectus
to any of our contracts, agreements or other documents, the references are materially complete but may not include a description of all
aspects of such contracts, agreements or other documents, and you should refer to the exhibits attached to the registration statement
for copies of the actual contract, agreement or other document.
Upon completion of this offering, we will be subject
to the information requirements of the Exchange Act and will file annual, quarterly and current event reports, proxy statements and other
information with the SEC. You can read our SEC filings, including the registration statement, over the Internet at the SEC’s website
at www.sec.gov. You may also read and copy any document we file with the SEC at its public reference facility at 100 F Street,
N.E., Washington, D.C. 20549.
No dealer, salesperson or any other person is
authorized to give any information or make any representations in connection with this offering other than those contained in this prospectus
and, if given or made, the information or representations must not be relied upon as having been authorized by us. This prospectus does
not constitute an offer to sell or a solicitation of an offer to buy any security other than the securities offered by this prospectus,
or an offer to sell or a solicitation of an offer to buy any securities by anyone in any jurisdiction in which the offer or solicitation
is not authorized or is unlawful.
INDEX TO FINANCIAL STATEMENTS
|
|
|
Page
|
|
Report of Independent Registered Public Accounting Firm
|
|
F-2
|
|
Balance Sheets as of September 30, 2021 (unaudited) and June 16, 2021
|
|
F-3
|
|
Statements of Operations for the period from April 28, 2021 (inception) through September 30, 2021 (unaudited) and from April 28, 2021 (inception) through June 16, 2021
|
|
F-4
|
|
Statements of Changes in Stockholders’ Equity for the period from April 28, 2021 (inception) through September 30, 2021 (unaudited) and from April 28, 2021 (inception) through June 16, 2021
|
|
F-5
|
|
Statements of Cash Flows for the period from April 28, 2021 (inception) through September 30, 2021 (unaudited) and from April 28, 2021 (inception) through June 16, 2021
|
|
F-6
|
|
Notes to the Financial Statements
|
|
F-7
|
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
To the Stockholders and Board of Directors of
Western Acquisition Ventures Corp.
Opinion on the Financial Statements
We have audited the accompanying balance
sheet of Western Acquisition Ventures Corp. (the “Company”) as of June 16, 2021, the related statements of
operations, changes in stockholders’ equity and cash flows for the period from April 28, 2021 (inception) through
June 16, 2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the
financial statements present fairly, in all material respects, the financial position of the Company as of June 16, 2021, and
the results of its operations and its cash flows for the period from April 28, 2021 (inception) through June 16, 2021, in
conformity with accounting principles generally accepted in the United States of America.
Explanatory Paragraph – Going Concern
The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern. As more fully described in Note 1 to the financial
statements, the Company’s ability to execute its business plan is dependent upon its completion of the proposed initial public
offering described in Note 3 to the financial statements. The Company has a working capital deficiency as of June 16, 2021, and
lacks the financial resources it needs to sustain operations for a reasonable period of time, which is considered to be one year
from the issuance date of the financial statements. These conditions raise substantial doubt about the Company's ability to continue
as a going concern. Management's plans with regard to these matters are also described in Notes 1 and 3. The financial statements do
not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We
are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the
standards of the PCAOB. Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement,
whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over
financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but
not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly,
we express no such opinion.
Our audit included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial
statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as
evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ Marcum llp
Marcum llp
We have served as the Company’s auditor since 2021.
Boston, MA
July 13, 2021, except for Note 8,
as to which the date is December 1, 2021
WESTERN ACQUISITION VENTURES CORP.
BALANCE SHEETS
|
|
|
September 30, 2021
(unaudited)
|
|
|
June 16, 2021
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
|
|
|
|
Cash
|
|
$
|
11,437
|
|
|
$
|
25,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
11,437
|
|
|
|
25,000
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS
|
|
|
|
|
|
|
|
|
|
Deferred offering costs
|
|
|
297,125
|
|
|
|
122,596
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other assets
|
|
|
297,125
|
|
|
|
122,596
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$
|
308,562
|
|
|
$
|
147,596
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued expenses
|
|
$
|
1,600
|
|
|
$
|
2,084
|
|
|
Accrued offering costs
|
|
|
230,000
|
|
|
|
122,596
|
|
|
Note payable - related party
|
|
|
55,000
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
286,600
|
|
|
|
124,680
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
|
|
$
|
286,600
|
|
|
$
|
124,680
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
Preferred stock, $0.0001 par value; 1,000,000 shares authorized;
none issued or outstanding
|
|
$
|
-
|
|
|
$
|
-
|
|
|
Common stock; $0.0001 par value; 50,000,000 shares authorized;
2,875,000 issued and outstanding (1), (2)
|
|
|
287
|
|
|
|
287
|
|
|
Additional paid-in capital
|
|
|
24,713
|
|
|
|
24,713
|
|
|
Accumulated deficit
|
|
|
(3,038
|
)
|
|
|
(2,084
|
)
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL STOCKHOLDERS’
EQUITY
|
|
|
21,962
|
|
|
|
22,916
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
|
$
|
308,562
|
|
|
$
|
147,596
|
|
|
|
(1)
|
This
number includes an aggregate of up to 375,000 shares of common stock subject to forfeiture
if the over-allotment option is not exercised in full or in part by the underwriters (see
Note 4).
|
|
|
(2)
|
Shares
of Common stock have been retroactively restated to reflect the recapitalization of the Company
in the form of a 2 for 3 reverse stock split on November 22, 2022 (see Note 4).
|
The accompanying notes are an integral part of
these financial statements.
WESTERN ACQUISITION VENTURES CORP.
STATEMENTS OF OPERATIONS
|
|
|
For
the period April 28,
2021 (inception) through
September 30, 2021
(unaudited)
|
|
|
For
the period April 28,
2021 (inception)
through June 16, 2021
|
|
|
EXPENSES
|
|
|
|
|
|
|
|
|
|
General
and administrative expenses
|
|
$
|
3,038
|
|
|
$
|
2,084
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
|
3,038
|
|
|
|
2,084
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
|
|
$
|
(3,038
|
)
|
|
$
|
(2,084
|
)
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE SHARES OUTSTANDING, BASIC AND DILUTED (1), (2)
|
|
|
2,500,000
|
|
|
|
2,500,000
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC AND DILUTED NET LOSS
PER SHARE
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
|
(1)
|
This
number excludes an aggregate of up to 375,000 shares of common stock subject to forfeiture
if the over-allotment option is not exercised in full or in part by the underwriters (see
Note 4).
|
|
|
(2)
|
Shares of Common stock
have been retroactively restated to reflect the recapitalization of the Company in the form
of a 2 for 3 reverse stock split on November 22, 2021 (see Note 4).
|
The accompanying notes are an integral part of
these financial statements.
WESTERN ACQUISITION VENTURES CORP.
STATEMENTS OF CHANGES
IN STOCKHOLDERS’ EQUITY
For the period from April 28, 2021 (inception)
through September 30, 2021 (unaudited) and
from April 28, 2021 (inception) through June 16, 2021
|
|
|
|
|
|
Additional
|
|
|
|
|
|
|
|
|
|
|
Common
Stock
|
|
|
Paid-In
|
|
|
Accumulated
|
|
|
Stockholders'
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Deficit
|
|
|
Equity
|
|
|
Balance as of April 28, 2021 (inception)
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
Issuance of common stock to Sponsor(1)(2
)
|
|
|
2,875,000
|
|
|
|
287
|
|
|
|
24,713
|
|
|
|
-
|
|
|
|
25,000
|
|
|
Net loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(2,084
|
)
|
|
|
(2,084
|
)
|
|
Balance as of June 16, 2021
|
|
|
2,875,000
|
|
|
|
287
|
|
|
|
24,713
|
|
|
|
(2,084
|
)
|
|
|
22,916
|
|
|
Net loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(954
|
)
|
|
|
(954
|
)
|
|
Balance as of September 30, 2021 (unaudited)
|
|
|
2,875,000
|
|
|
$
|
287
|
|
|
$
|
24,713
|
|
|
$
|
(3,038
|
)
|
|
$
|
21,962
|
|
|
|
(1)
|
Includes
an aggregate of up to 375,000 shares subject to forfeiture if the over-allotment option is
not exercised in full or in part by the underwriters (see Note 4).
|
|
|
(2)
|
Shares of Common stock
have been retroactively restated to reflect the recapitalization of the Company in the form
of a 2 for 3 reverse stock split on November 22, 2021 (see Note 4).
|
The accompanying notes are an integral part of
these financial statements.
WESTERN ACQUISITION VENTURES CORP.
STATEMENTS OF CASH FLOWS
|
|
|
For the period April 28, 2021
(inception) through September 30,
2021 (unaudited)
|
|
|
For the period April 28, 2021
(inception) through June 16, 2021
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(3,038
|
)
|
|
$
|
(2,084
|
)
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
1,600
|
|
|
|
2,084
|
|
|
Net cash flows used in operating activities
|
|
|
(1,438
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Payment of Deferred Offering Costs
|
|
|
(67,125
|
)
|
|
|
-
|
|
|
Net cash flows used in investing activities
|
|
|
(67,125
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock to Sponsor
|
|
|
25,000
|
|
|
|
25,000
|
|
|
Proceeds from notes payable - related party
|
|
|
55,000
|
|
|
|
-
|
|
|
Net cash flows provided by financing activities
|
|
|
80,000
|
|
|
|
25,000
|
|
|
|
|
|
|
|
|
|
|
|
|
NET CHANGE IN CASH
|
|
|
11,437
|
|
|
|
25,000
|
|
|
CASH, BEGINNING OF PERIOD
|
|
|
-
|
|
|
|
-
|
|
|
CASH, END OF PERIOD
|
|
$
|
11,437
|
|
|
$
|
25,000
|
|
|
Supplemental disclosure of noncash activities:
|
|
|
|
|
|
|
|
|
|
Deferred offering costs included in accrued offering costs
|
|
$
|
230,000
|
|
|
$
|
122,596
|
|
The accompanying notes are an integral part of
these financial statements.
WESTERN ACQUISITION VENTURES CORP.
NOTES TO FINANCIAL STATEMENTS
Note 1 — Description of Organization, Business Operations,
Going Concern and Basis of Presentation
Western Acquisition Ventures
Corp. (the "Company") is a blank check company incorporated in Delaware on April 28, 2021. The Company was formed for the
purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar initial business combination
with one or more businesses (the "Initial business combination"). The Company is an emerging growth company and, as such, the
Company is subject to all of the risks associated with emerging growth companies.
As of September 30, 2021,
the Company had not commenced any operations. All activity for the period from April 28, 2021 (inception) through September 30, 2021
relates to the Company’s formation and the proposed initial public offering described below. The Company will not generate any operating
revenues until after the completion of its initial business combination, at the earliest. The Company will generate non-operating income
in the form of interest income on cash and cash equivalents from the proceeds derived from the Proposed Public Offering (as defined below).
The Company has selected December 31 as its fiscal year end.
The
Company’s sponsor is Western Acquisition Ventures Sponsor LLC, a Delaware limited liability corporation (the "Sponsor").
The Company’s ability to commence operations is contingent upon obtaining adequate financial resources through a proposed public
offering (the "Proposed Public Offering") of 10,000,000 units of the Company (each, a "Unit" and collectively, the
"Units") at $10.00 per Unit (or 11,500,000 Units if the underwriter’s over-allotment option is exercised in full), which
is discussed in Note 3. Additionally, the Sponsor has committed to purchase an aggregate of 361,000 units (or up to 376,000 units depending
on the extent to which the underwriters’ over-allotment option is exercised), at $10.00 per unit for a total purchase price of
$3,610,000 (or up to $3,760,000 depending on the extent to which
the underwriters’ over-allotment option is exercised) in a private placement that will close simultaneously with the closing
of this offering. Each placement unit will be identical to the units sold in this offering, except as described in this prospectus. We
refer to these units as the placement units throughout this prospectus.
The Company’s management
has broad discretion with respect to the specific application of the net proceeds of the Proposed Public Offering though substantially
all of the net proceeds are intended to be applied generally toward consummating an initial business combination. There is no assurance
that the Company will be able to complete an initial business combination successfully. The Company must complete one or more initial
business combinations having an aggregate fair market value of at least 80% of the net assets held in the Trust Account (as defined below)
(excluding the amount of the initial business combination marketing fee payable to A.G.P. as described in “Underwriting - Conflicts
of Interest” held in Trust and taxes payable on the income earned on the Trust Account) at the time of the agreement to enter into
our initial business combination. However, the Company only intends to complete an initial business combination if the post-transaction
company owns or acquires 50% or more of the issued and 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 1940,
as amended (the "Investment Company Act"). Upon the closing of the Proposed Public Offering, management has agreed that an
amount equal to at least $10.10 per Unit sold in the Proposed Public Offering will be held in a trust account ("Trust Account")
located in the United States with American Stock Transfer & Trust Company acting as trustee, and invested 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 that invest only in direct U.S. government treasury obligations, as determined by the Company, until the earlier of: (i) the
completion of an initial business combination and (ii) the distribution of the Trust Account as described below.
The Company will provide
the holders of the outstanding Public Shares (the “Public Stockholders”) with the opportunity to redeem all or a portion
of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve
the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of
a Business Combination or conduct a tender offer will be made by the Company. The Public Stockholders will be entitled to redeem their
Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.10 per Public Share, plus
any pro rata interest then in the Trust Account, net of taxes payable). There will be no redemption rights with respect to the Company’s
warrants.
All of the Public Shares
contain a redemption feature which allows for the redemption of such Public Shares in connection with the Company’s liquidation,
if there is a stockholder vote or tender offer in connection with the Company’s Business Combination and in connection with certain
amendments to the Company’s amended and restated certificate of incorporation (the “Certificate of Incorporation”).
In accordance with the rules of the U.S. Securities and Exchange Commission (the “SEC”) and its guidance on redeemable equity
instruments, which has been codified in ASC 480-10-S99, redemption provisions not solely within the control of a company require common
stock subject to redemption to be classified outside of permanent equity. Given that the Public Shares will be issued with other freestanding
instruments (i.e., public warrants), the initial carrying value of common stock classified as temporary equity will be the allocated proceeds
determined in accordance with ASC 470-20. The Public Shares are subject to ASC 480-10-S99. If it is probable that the equity instrument
will become redeemable, the Company has the option to either (i) accrete changes in the redemption value over the period from the date
of issuance (or from the date that it becomes probable that the instrument will become redeemable, if later) to the earliest redemption
date of the instrument or (ii) recognize changes in the redemption value immediately as they occur and adjust the carrying amount of the
instrument to equal the redemption value at the end of each reporting period. The Company has elected to recognize the changes immediately.
The accretion or remeasurement will be treated as a deemed dividend (i.e., a reduction to retained earnings, or in absence of retained
earnings, additional paid-in capital). While redemptions cannot cause the Company’s net tangible assets to fall below $5,000,001,
the Public Shares are redeemable and will be classified as such on the balance sheet until such date that a redemption event takes place.
Redemptions of the Company’s Public Shares may be subject to
the satisfaction of conditions, including minimum cash conditions, pursuant to an agreement relating to the Company’s Business
Combination. If the Company seeks stockholder approval of the Business Combination, the Company will proceed with a Business Combination
if a majority of the shares voted are voted in favor of the Business Combination, or such other vote as required by law or stock exchange
rule. If a stockholder vote is not required by applicable law or stock exchange listing requirements and the Company does not decide
to hold a stockholder vote for business or other reasons, the Company will, pursuant to its Certificate of Incorporation, conduct the
redemptions pursuant to the tender offer rules of the SEC and file tender offer documents with the SEC prior to completing a Business
Combination. If, however, stockholder approval of the transaction is required by applicable law or stock exchange listing requirements,
or the Company decides to obtain stockholder approval for business or other reasons, the Company will offer to redeem shares in conjunction
with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval
in connection with a Business Combination, the Sponsor has agreed to vote its Founder Shares (as defined in Note 4) and any Public Shares
purchased during or after the Proposed Public Offering in favor of approving a Business Combination. Additionally, each Public Stockholder
may elect to redeem their Public Shares without voting, and if they do vote, irrespective of whether they vote for or against the proposed
transaction.
The Certificate of Incorporation
will provide that a Public Stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder
is acting in concert or as a "group" (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the Public Shares,
without the prior consent of the Company. The holders of the Founder Shares (the "initial stockholders") have agreed not to
propose an amendment to the Certificate of Incorporation (A) to modify the substance or timing of the Company’s obligation
to allow redemption in connection with an initial business combination or to redeem 100% of the Public Shares if the Company does not
complete an initial business combination within the Combination Period (as defined below) or (B) with respect to any other provision
relating to stockholders’ rights or pre-initial business combination activity, unless the Company provides its Public Stockholders
with the opportunity to redeem their Public Shares in conjunction with any such amendment.
If the Company is unable
to complete an initial business combination within 12 months (or up to 18 months, if extended) from the closing of the Proposed Public
Offering (the "Combination Period") and the Company’s stockholders have not amended the Certificate of Incorporation
to extend such Combination Period, the Company will (i) cease all operations except for the purpose of winding up; (ii) as
promptly as reasonably possible but no more than ten business days thereafter subject to lawfully available funds therefor, 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 the Company to pay its taxes, if any (less up to $100,000
of interest to pay dissolution costs and expenses) divided by the number of the then-outstanding Public Shares, which redemption will
completely extinguish Public Stockholders’ rights as stockholders (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 the remaining stockholders and its board of directors, liquidate and dissolve, subject in each case to the Company’s obligations
under Delaware law to provide for claims of creditors and the requirements of other applicable law.
The initial stockholders
have agreed to waive their rights to liquidating distributions from the Trust Account with respect to the Founder Shares if the Company
fails to complete an initial business combination within the Combination Period. However, if the initial stockholders acquire Public
Shares in or after the Proposed Public Offering, they will be entitled to liquidating distributions from the Trust Account with respect
to such Public Shares if the Company fails to complete an initial business combination within the Combination Period. The underwriters
have agreed to waive their rights to the initial business combination marketing fee (see Note 5) held in the Trust Account in the event
the Company does not complete an initial business combination within in the Combination Period and, in such event, such amounts will
be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the
event of such distribution, it is possible that the per share value of the residual assets remaining available for distribution (including
Trust Account assets) will be only $10.10. In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable
to the Company if and to the extent any claims by a third party (except for the Company’s independent registered public accounting
firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering
into a transaction agreement (a "Target"), reduce the amount of funds in the Trust Account to below (i) $10.10 per Public
Share or (ii) the lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account
due to reductions in the value of the trust assets, in each case net of interest that may be withdrawn to pay taxes, provided that such
liability will not apply to any claims by a third party or Target that executed a waiver of any and all rights to seek access to the
Trust Account nor will it apply to any claims under the Company’s indemnity of the underwriters of the Proposed Public Offering
against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the "Securities Act"). In
the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent
of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify
the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (other than the Company’s independent
registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements
with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.
Going Concern Consideration
As of September 30, 2021
and June 16, 2021, the Company had $11,437 and $25,000 in cash, respectively, and a working capital deficiency of $275,163 and $99,680,
respectively. Further, the Company has incurred and expects to continue to incur significant costs in pursuit of its financing and acquisition
plans. Management’s plans to address this need for capital are through the Proposed Public Offering. The Company cannot assure that
its plans to raise capital or to consummate its initial business combination will be successful. In addition, management is currently
evaluating the impact of the COVID-19 pandemic on the industry and its effect on the Company’s financial position, results its operations
and/or search for a target company. See further discussion of the Company’s assessment of the COVID-19 pandemic below.
These factors, among others, raise substantial
doubt about the Company’s ability to continue as going concern one year from the date these financial statements are issued. The
financial statements do not include any adjustments that might result from its inability to consummate the Proposed Public Offering or
its inability to continue as a going concern.
Basis of Presentation
The accompanying audited
financial statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the United States
of America ("U.S. GAAP") and pursuant to the rules and regulations of the SEC. All financial statements and information
about events after June 16, 2021 are unaudited. In the opinion of management, the accompanying unaudited financial statements include
all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating
results and cash flows as of September 30, 2021 and for the period from April 28, 2021 (inception) through September 30, 2021. The results for the period from April 28, 2021 (inception) through September 30, 2021
are not necessarily indicative of the results to be expected for the year ending December 31, 2021.
Emerging Growth Company
The Company is an "emerging
growth company," as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act
of 2012 (the "JOBS Act"), and it 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
independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced
disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements
of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously
approved.
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 an emerging growth 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. The Company has 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, the Company, 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 the Company’s financial statements with another public company that is
neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult
or impossible because of the potential differences in accounting standards used.
Note 2 — Summary of Significant Accounting Policies
Concentration of Credit Risk
Financial instruments that
potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times,
may exceed the Federal Depository Insurance Coverage limit of $250,000. At September 30, 2021 and June 16, 2021, the Company has not experienced
losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.
Financial Instruments
The fair value of the Company’s
assets and liabilities, which qualify as financial instruments under FASB ASC 820, "Fair Value Measurement," approximates the
carrying amounts represented in the balance sheet.
Use of Estimates
The preparation of financial
statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities during the reporting period. Actual results could
differ from those estimates.
Deferred Offering Costs Associated with
the Proposed Public Offering
Deferred
offering costs will consist of direct costs incurred through the balance sheet date that are directly related to the Proposed Public Offering
and that will be charged to stockholders’ equity upon the completion of the Proposed Public Offering. Should the Proposed Public
Offering prove to be unsuccessful, these deferred costs, as well as additional expenses to be incurred, will be charged to operations.
At September 30, 2021 and June 16, 2021, the Company has incurred $297,125 and $122,596 of deferred offering costs, respectively.
Net Loss Per Share of Common Stock
The Company complies
with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net loss per share is computed by
dividing net loss by the weighted average number of shares of common stock outstanding during the period. The weighted average number
of shares outstanding were reduced for the effect of an aggregate of 375,000 Founders Shares that are subject to forfeiture if the over-allotment
option is not exercised by the underwriters. At September 30, 2021 and June 16, 2021, the Company did not have any dilutive securities
and other contracts that could, potentially, be exercised or converted into shares of common stock and then share in the earnings of
the Company. As a result, diluted loss per share is the same as basic loss per share for the period presented.
Income Taxes
The Company follows the asset
and liability method of accounting for income taxes under FASB ASC 740, "Income Taxes." Deferred tax assets and liabilities
are recognized for the estimated future tax consequences attributable to differences between the carrying amounts of existing assets and
liabilities in the financial statements and their respective tax bases. Deferred tax assets and liabilities are measured using enacted
tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment
date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Deferred
tax assets were deemed immaterial as of September 30, 2021 and June 16, 2021.
FASB ASC 740 prescribes a
recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected
to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination
by taxing authorities. There were no unrecognized tax benefits as of September 30, 2021 and June 16, 2021. The Company recognizes accrued
interest and penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for the payment of interest
and penalties as of September 30, 2021 and June 16, 2021. The Company is currently not aware of any tax issues under review that could
result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by
major taxing authorities since inception. The provision for income taxes was deemed to be de minimis for the periods from April 28, 2021
(inception) through September 30, 2021 and from April 28, 2021 (inception) through June 16, 2021.
Recent Accounting Pronouncements
In
August 2020, the FASB issued ASU No. 2020-06, Debt – debt with Conversion and Other Options (Subtopic 470-20) and Derivatives
and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in
an Entity’s Own Equity (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation
models required under current GAAP. The ASU also removes certain settlement conditions that are required for equity-linked contracts
to qualify for the derivative scope exception, and it simplifies the diluted earnings per share calculation in certain areas. The Company
adopted ASU 2020-06 on April 28, 2021 (inception). The Company does not believe adopting ASU 2020-06 will have an impact on the Company’s
financial position, results of operations, or cash flows.
Management
does not believe that any recently issued, but not yet effective, accounting standards if currently adopted would have a material effect
on the accompanying financial statements.
Note 3 — Proposed Public Offering
Pursuant to the Proposed
Public Offering, the Company intends to offer for sale 10,000,000 Units at a price of $10.00 per Unit, and has granted to the underwriters
of the Proposed Public Offering a 45-day option to purchase up to an additional 1,500,000 units (over and above the 10,000,000 Units
referred to above) solely to cover over-allotments, if any.
Each unit consists of
one share of common stock, par value $0.0001, and one warrant, which we refer to throughout this prospectus as “warrants”
or the “public warrants.” Each warrant entitles the holder thereof to purchase three-quarters (3/4) of a share of common
stock at a price of $11.50 per whole share, subject to adjustment as described in the prospectus. We will not issue fractional shares.
As a result, you must exercise public warrants in multiples of two warrants, at a price of $11.50 per whole share, subject to adjustment
as described in this prospectus, to validly exercise your warrants. Each warrant will become exercisable on the later of one year after
the closing of this offering or the consummation of its initial business combination and will expire five years after the completion
of its initial business combination, or earlier upon redemption.
Note 4 — Related Party Transactions
Founder Shares
On June 9, 2021,
the Sponsor acquired 4,312,500 shares of common stock of the Company (the “Founder Shares”) for an aggregate purchase price
of $25,000. Prior to the initial investment in the Company of $25,000 by the Sponsor, the Company had no assets, tangible or intangible.
The per share purchase price of the Founder Shares was determined by dividing the amount of cash paid to the Company by the aggregate
number of Founder Shares issued. On June 16, 2021, the Sponsor transferred 1,207,500 of the Founder Shares to an affiliate of A.G.P.
for $7,000. On November 22, 2021, the Company effected a 2 for 3 reverse stock split of its common stock, and A.G.P. sold back to the
Company’s sponsor 55,000 founder shares for $478, such that the sponsor owns an aggregate of 2,125,000 founder shares, and A.G.P.
owns 750,000 founder shares. Shares and associated amounts have been retroactively restated to reflect the reverse stock split. Up to
375,000 Founder Shares (including the Founder Shares transferred to an affiliate of A.G.P.) are subject to forfeiture by the subscribers
if the underwriters of the initial public offering (“IPO”) of units (“Units”) of the Company, do not fully exercise
their over-allotment option (the “Over-allotment Option”). The forfeiture will be adjusted to the extent that the over-allotment
option is not exercised in full by the underwriters so that the Founder Shares will represent 20.0% of the Company’s issued and
outstanding shares after the Proposed Public Offering. If the Company increases or decreases the size of the offering, the Company will
effect a stock dividend or share contribution back to capital, as applicable, immediately prior to the consummation of the Proposed Public
Offering in such amount as to maintain the Founder Share ownership of the Company’s stockholders prior to the Proposed Public Offering
at 20.0% of the Company’s issued and outstanding shares of common stock upon the consummation of the Proposed Public Offering.
The initial
stockholders will agree, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier
to occur of: (A) one year after the completion of the initial Business Combination or (B) subsequent to the initial
Business Combination, (x) if the last sale price of the common stock equals or exceeds $12.00 per share (as adjusted for stock
splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period
commencing at least 150 days after the initial Business Combination, or (y) the date on which the Company completes a
liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders
having the right to exchange their shares of common stock for cash, securities or other property.
Related Party Promissory Note
On June 9, 2021, the Company
issued an unsecured promissory note to the Sponsor (the “Promissory Note”), pursuant to which the Company may borrow up to
an aggregate principal amount of $300,000. The Promissory Note is non-interest bearing and payable on the earlier to occur of (i) December
31, 2021 and (ii) the consummation of the Proposed Public Offering. As of September 30, 2021, the Company has $55,000 outstanding under
the promissory note.
Related Party Loans
In order to fund working
capital deficiencies or finance transaction costs in connection with an intended initial business combination, the initial stockholders,
officers, and directors, and their affiliates may, but are not obligated to, loan the Company funds as may be required. If the Company
completes its initial business combination, it may repay such loaned amounts out of the proceeds of the trust account released to the
Company. In the event that the initial business combination does not close, the Company may use a portion of the working capital held
outside the trust account to repay such loaned amounts but no proceeds from the trust account would be used for such repayment. The terms
of such loans by the initial stockholders, officers, and directors, and their affiliates if any, have not been determined and no written
agreements exist with respect to such loans.
In addition, in order to
finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s
officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”).
If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account
released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the
event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the
Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing,
the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans.
The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s
discretion, up to $1.5 million of such Working Capital Loans may be convertible into units of the post Business Combination entity at
a price of $10.00 per unit. The units would be identical to the Private Placement Units. There were no Working Capital Loans outstanding
as of September 30, 2021 or June 16, 2021.
Note 5 — Private Placement
The
Sponsor has agreed to purchase an aggregate of 361,000 units (or up to 376,000 units depending on the extent to which the underwriters’
over-allotment option is exercised), at $10.00 per unit for a total purchase price of $3,610,000 (or
up to $3,760,000 depending on the extent to which the underwriters’ over-allotment option is exercised) on a private placement
basis simultaneously with the consummation of this offering (the “private placement units”). The Sponsor will purchase
additional units if the underwriters’ over-allotment option is exercised in full or in part. The private placement units will be
identical to the public units sold, subject to certain limited exceptions as described in this prospectus. There will be no underwriting
fees or commissions with respect to the private placement units.
Note 6 — Commitments & Contingencies
Registration Rights
The holders of Founder Shares,
private placement units and warrants that may be issued upon conversion of Working Capital Loans, if any (and any shares of common stock
issuable upon the exercise of the private placement units or warrants issued upon conversion of the Working Capital Loans), will be entitled
to registration rights pursuant to a registration rights agreement to be signed prior to the consummation of the Proposed Public Offering.
These holders will be entitled to certain demand and "piggyback" registration rights. However, the registration rights agreement
will provide that we will not be required to effect or permit any registration or cause any registration statement to become effective
until termination of the applicable lock-up period. The Company will bear the expenses incurred in connection with the filing of any such
registration statements.
Underwriting Agreement
The underwriters
will be entitled to an underwriting fee of $500,000, payable upon the closing of the Proposed Public Offering, regardless of if the
underwriters’ exercise the over-allotment option. As an additional underwriting fee, on June 16, 2021, the Sponsor
transferred 1,207,500 of the Founder Shares to an affiliate of A.G.P. for $7,000 (up to 157,500 shares of which are subject to
forfeiture to the extent that the underwriters’ over-allotment option is not exercised in full or in part). On November 22,
2021, the Company effected a 2 for 3 reverse stock split of its common stock, and A.G.P. sold back to the Company’s sponsor
55,000 founder shares for $478, such that the sponsor owns an aggregate of 2,125,000 founder shares, and A.G.P. owns 750,000 founder
shares.
Business Combination Marketing Agreement
The Company has engaged Alliance
Global Partners (“AGP”) as an advisor in connection with a Business Combination to assist the Company in holding meetings
with its stockholders to discuss the potential Business Combination and the target business’ attributes, introduce the Company to
potential investors that are interested in purchasing the Company’s securities in connection with a Business Combination, assist
the Company in obtaining stockholders approval for the Business Combination and assist the Company with its press releases and public filings
in connection with the Business Combination. The Company will pay AGP a fee for such marketing services upon the consummation of a Business
Combination in an amount equal to 4.5% of the gross proceeds of Proposed Public Offering (exclusive of any applicable finders’ fees
which might become payable).
Note 7 — Stockholders’ Equity
Common
Stock — The Company is authorized to issue 50,000,000 shares of common stock with a par value of $0.0001 per share.
As of September 30, 2021 and June 16, 2021, there were 4,312,500 shares of common stock issued and outstanding, up to 562,500 shares
of which are subject to forfeiture depending on the extent to which the underwriters’ over-allotment option is exercised in connection
with the Proposed Public Offering. On November 22, 2021, the Company effected a 2 for 3 reverse stock split of its common stock, and there were 2,875,000
shares of common stock issued and outstanding, up to 375,000 shares of which are subject to forfeiture depending on the extent to which
the underwriters’ over-allotment option is exercised in connection with the Proposed Public Offering.
Holders of the common shares
will vote on all matters submitted to a vote of the Company's stockholders, except as required by law or stock exchange rule; provided
that holders of the common shares shall have the right to vote on the election of the Company's directors prior to its initial business
combination.
Preferred Stock—The
Company is authorized to issue 1,000,000 shares of preferred stock with such designations, voting and other rights and preferences as
may be determined from time to time by the Company’s board of directors. At September 30, 2021 and June 16, 2021, there were no
shares of preferred stock issued or outstanding.
Public Warrants
- The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or
(b) 12 months from the closing of the Proposed Public Offering. No warrants will be exercisable for cash unless the Company has
an effective and current registration statement covering the shares of common stock issuable upon exercise of the warrants and a
current prospectus relating to such shares of common stock. Notwithstanding the foregoing, if a registration statement covering the
shares of common stock issuable upon exercise of the Public Warrants is not effective within a specified period following the
consummation of a Business Combination, warrant holders may, until such time as there is an effective registration statement and
during any period when the Company shall have failed to maintain an effective registration statement, exercise warrants on a
cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such exemption
is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a
cashless basis.
The Public Warrants will
expire five years after the completion of a Business Combination or earlier upon redemption or liquidation.
Once the warrants become
exercisable, the Company may redeem the Public Warrants:
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•
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in whole and not in part;
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•
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at a price of $0.01 per warrant;
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|
•
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upon not less than 30 days’ prior written notice of redemption;
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|
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•
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if, and only if, the reported last sale price of the shares
of common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock 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 the notice of redemption to warrant holders; and
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•
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if, and only if, there is a current registration statement in
effect with respect to the shares of common stock underlying the warrants.
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If the Company calls the
Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do
so on a “cashless basis,” as described in the warrant agreement.
The exercise price and
number of shares of common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the
event of a stock dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, the
warrants will not be adjusted for issuances of shares of common stock at a price below their respective exercise prices.
Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a
Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of
warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the
Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire
worthless.
In addition, if the Company issues additional
shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination
at an issue price or effective issue price of less than $9.20 per share of common stock (with such issue price or effective issue price
to be determined in good faith by the Company’s board of directors, and in the case of any such issuance to the initial stockholders
or their affiliates, without taking into account any Founder Shares held by them prior to such issuance), (y) the aggregate gross
proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of
a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted
average trading price of the Company’s common stock during the 20 trading day period starting on the trading day prior to the
day on which the Company consummates Business Combination (such price, the “Market Value”) is below $9.20 per share, 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
price at which the Company issues the additional shares of common stock or equity-linked securities.
Private Warrants - The warrants underlying the private placement
units that will be sold in the private placement will be identical to the Public Warrants underlying the Units being sold in the Proposed
Public Offering, except that such warrants, and the shares of common stock issuable upon the exercise of such warrants, will not be transferable,
assignable or salable until after the completion of a Business Combination, subject to certain limited exceptions.
Note 8 — Subsequent Events
Subsequent events
are events or transactions that occur after the balance sheet date but before the financial statements are issued or are available
to be issued. These events and transactions either provide additional evidence about conditions that existed at the date of the
balance sheet, including the estimates inherent in the process of preparing the financial statements (that is, recognized subsequent
events), or provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date (that
is, non-recognized subsequent events). In accordance with ASC 855, Subsequent Events, the Company has evaluated subsequent events
through December 1, 2021. On November 22, 2021, the Company effected a 2 for 3 reverse stock split of its common stock, and A.G.P. sold back to the Company’s
sponsor 55,000 founder shares for $478, such that the sponsor owns an aggregate of 2,125,000 founder shares, and A.G.P. owns 750,000 founder
shares (see Notes 4 and
7).
$100,000,000
Western Acquisition Ventures Corp.
10,000,000 Units
PRELIMINARY PROSPECTUS
Sole Book-Running
Manager
A.G.P.
Co-Manager
Brookline
Capital Markets
a division of Arcadia
Securities, LLC
Qualified Independent
Underwriter
The Benchmark
Company, LLC
, 2021
Until ,
2021 (25 days after the date of this prospectus), all dealers that buy, sell or trade our shares of common stock, whether or not participating
in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus
when acting as underwriters and with respect to their unsold allotments or subscriptions.
INFORMATION NOT REQUIRED IN PROSPECTUS
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Item 13.
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Other Expenses of Issuance and Distribution.
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The estimated expenses payable by us in connection
with the offering described in this registration statement (other than the underwriting discount and commissions) will be as follows:
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SEC expenses
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$
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15,991
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FINRA expenses
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$
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46,454
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Accounting fees and expenses
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$
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40,000
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Printing and engraving expenses
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$
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35,000
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Legal fees and expenses
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$
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375,000
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Nasdaq listing and filing fees
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$
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75,000
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Miscellaneous(1)
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$
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97,555
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Total
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$
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685,000
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(1)
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This amount represents additional expenses that may be incurred by us in connection with the offering over and above those specifically listed above, including distribution and mailing costs, transfer agent fees, warrant agent fees and trustee fees and any travel and road show expenses.
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Item 14.
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Indemnification of Directors and officers.
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Our amended and restated certificate of incorporation
will provide that all of our directors, officers, employees and agents shall be entitled to be indemnified by us to the fullest extent
permitted by Section 145 of the Delaware General Corporation Law or DGCL. Section 145 of the DGCL concerning indemnification
of officers, directors, employees and agents is set forth below.
Section 145. Indemnification of officers,
directors, employees and agents; insurance.
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(a)
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A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner that the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that the person’s conduct was unlawful.
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(b)
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A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses that the Court of Chancery or such other court shall deem proper.
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(c)
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To the extent that a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of this section, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.
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(d)
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Any indemnification under subsections (a) and (b) of this section (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is proper in the circumstances because the person has met the applicable standard of conduct set forth in subsections (a) and (b) of this section. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, or (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (4) by the stockholders.
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(e)
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Expenses (including attorneys’ fees) incurred by an officer or director in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized in this section. Such expenses (including attorneys’ fees) incurred by former officers and directors or other employees and agents may be so paid upon such terms and conditions, if any, as the corporation deems appropriate.
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(f)
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The indemnification and advancement of expenses provided by, or granted pursuant to, the other subsections of this section shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office. A right to indemnification or to advancement of expenses arising under a provision of the certificate of incorporation or a bylaw shall not be eliminated or impaired by an amendment to such provision after the occurrence of the act or omission that is the subject of the civil, criminal, administrative or investigative action, suit or proceeding for which indemnification or advancement of expenses is sought, unless the provision in effect at the time of such act or omission explicitly authorizes such elimination or impairment after such action or omission has occurred.
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(g)
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A corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the corporation would have the power to indemnify such person against such liability under this section.
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(h)
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For purposes of this section, references to “the corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger that, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under this section with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued.
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(i)
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For purposes of this section, references to “other enterprises” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on a person with respect to any employee benefit plan; and references to “serving at the request of the corporation” shall include any service as a director, officer, employee or agent of the corporation that imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the corporation” as referred to in this section.
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(j)
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The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person.
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(k)
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The Court of Chancery is hereby vested with exclusive jurisdiction to hear and determine all actions for advancement of expenses or indemnification brought under this section or under any by law, agreement, vote of stockholders or disinterested directors, or otherwise. The Court of Chancery may summarily determine a corporation’s obligation to advance expenses (including attorneys’ fees).
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Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to our directors, officers, and controlling persons pursuant to the foregoing provisions, or
otherwise, we have been advised that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment of
expenses incurred or paid by a director, officer or controlling person in a successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to the court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication
of such issue.
In accordance with Section 102(b)(7) of
the DGCL, our amended and restated certificate of incorporation, will provide that no director shall be personally liable to us or any
of our stockholders for monetary damages resulting from breaches of their fiduciary duty as directors, except to the extent such limitation
on or exemption from liability is not permitted under the DGCL. The effect of this provision of our amended and restated certificate of
incorporation is to eliminate our rights and those of our stockholders (through stockholders’ derivative suits on our behalf) to
recover monetary damages against a director for breach of the fiduciary duty of care as a director, including breaches resulting from
negligent or grossly negligent behavior, except, as restricted by Section 102(b)(7) of the DGCL. However, this provision does
not limit or eliminate our rights or the rights of any stockholder to seek non-monetary relief, such as an injunction or rescission, in
the event of a breach of a director’s duty of care.
If the DGCL is amended to authorize corporate
action further eliminating or limiting the liability of directors, then, in accordance with our amended and restated certificate of incorporation,
the liability of our directors to us or our stockholders will be eliminated or limited to the fullest extent authorized by the DGCL, as
so amended. Any repeal or amendment of provisions of our amended and restated certificate of incorporation limiting or eliminating the
liability of directors, whether by our stockholders or by changes in law, or the adoption of any other provisions inconsistent therewith,
will (unless otherwise required by law) be prospective only, except to the extent such amendment or change in law permits us to further
limit or eliminate the liability of directors on a retroactive basis.
Our amended and restated certificate of incorporation
will also provide that we will, to the fullest extent authorized or permitted by applicable law, indemnify our current and former officers
and directors, as well as those persons who, while directors or officers of our corporation, are or were serving as directors, officers,
employees or agents of another entity, trust or other enterprise, including service with respect to an employee benefit plan, in connection
with any threatened, pending or completed proceeding, whether civil, criminal, administrative or investigative, against all expense, liability
and loss (including, without limitation, attorney’s fees, judgments, fines, ERISA excise taxes and penalties and amounts paid in
settlement) reasonably incurred or suffered by any such person in connection with any such proceeding. Notwithstanding the foregoing,
a person eligible for indemnification pursuant to our amended and restated certificate of incorporation will be indemnified by us in connection
with a proceeding initiated by such person only if such proceeding was authorized by our board of directors, except for proceedings to
enforce rights to indemnification.
The right to indemnification that will be conferred
by our amended and restated certificate of incorporation is a contract right that includes the right to be paid by us the expenses incurred
in defending or otherwise participating in any proceeding referenced above in advance of its final disposition, provided, however, that
if the DGCL requires, an advancement of expenses incurred by our officer or director (solely in the capacity as an officer or director
of our corporation) will be made only upon delivery to us of an undertaking, by or on behalf of such officer or director, to repay all
amounts so advanced if it is ultimately determined that such person is not entitled to be indemnified for such expenses under our amended
and restated certificate of incorporation or otherwise.
The rights to indemnification and advancement
of expenses will not be deemed exclusive of any other rights that any person covered by our amended and restated certificate of incorporation
may have or hereafter acquire under law, our amended and restated certificate of incorporation, our bylaws, an agreement, vote of stockholders
or disinterested directors, or otherwise.
Any repeal or amendment of provisions of our amended
and restated certificate of incorporation affecting indemnification rights, whether by our stockholders or by changes in law, or the adoption
of any other provisions inconsistent therewith, will (unless otherwise required by law) be prospective only, except to the extent such
amendment or change in law permits us to provide broader indemnification rights on a retroactive basis, and will not in any way diminish
or adversely affect any right or protection existing at the time of such repeal or amendment or adoption of such inconsistent provision
with respect to any act or omission occurring prior to such repeal or amendment or adoption of such inconsistent provision. Our amended
and restated certificate of incorporation will also permit us, to the extent and in the manner authorized or permitted by law, to indemnify
and to advance expenses to persons other that those specifically covered by our amended and restated certificate of incorporation.
Our bylaws, which we intend to adopt immediately
prior to the closing of this offering, include the provisions relating to advancement of expenses and indemnification rights consistent
with those that will be set forth in our amended and restated certificate of incorporation. In addition, our bylaws provide for a right
of indemnity to bring a suit in the event a claim for indemnification or advancement of expenses is not paid in full by us within a specified
period of time. Our bylaws also permit us to purchase and maintain insurance, at our expense, to protect us and/or any director, officer,
employee or agent of our corporation or another entity, trust or other enterprise against any expense, liability or loss, whether or not
we would have the power to indemnify such person against such expense, liability or loss under the DGCL.
Any repeal or amendment of provisions of our bylaws
affecting indemnification rights, whether by our board of directors, stockholders or by changes in applicable law, or the adoption of
any other provisions inconsistent therewith, will (unless otherwise required by law) be prospective only, except to the extent such amendment
or change in law permits us to provide broader indemnification rights on a retroactive basis, and will not in any way diminish or adversely
affect any right or protection existing thereunder with respect to any act or omission occurring prior to such repeal or amendment or
adoption of such inconsistent provision.
We will enter into indemnification agreements
with each of our officers and directors a form of which is to be filed as an exhibit to this registration statement. These agreements
will require us to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that may arise by
reason of their service to us, and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified.
Pursuant to the Underwriting Agreement to be filed
as Exhibit 1.1 to this registration statement, we have agreed to indemnify the underwriters and the underwriters have agreed to indemnify
us against certain civil liabilities that may be incurred in connection with this offering, including certain liabilities under the Securities
Act.
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Item 15.
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Recent Sales of Unregistered Securities.
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On June 9, 2021 our sponsor purchased an
aggregate of 4,312,500 founder shares in exchange for a capital contribution of $25,000, up to 562,500 shares of which are subject to
forfeiture depending on the extent to which the underwriters’ over-allotment option is exercised. The number of founder shares issued
was determined based on the expectation that the founder shares would represent approximately 20% of the outstanding shares of common
stock upon completion of this offering (not including the shares of common stock issuable upon exercise of the private placement
units). An affiliate of A.G.P./Alliance Global Partners received 1,207,500 founder shares from our sponsor, of which 157,500 shares are
subject to forfeiture depending on the extent to which the underwriters’ over-allotment option is exercised. Such securities were
issued in connection with our organization pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities
Act. Our initial stockholders are accredited investors for purposes of Rule 501 of Regulation D. No underwriting discounts or commissions
were paid with respect to such sales.
On November 22, 2021, we effected a 2 for 3 reverse stock split of our common stock, and A.G.P. sold back to our sponsor 55,000 founder
shares for $478, such that our sponsor owns 2,125,000 founder shares, and A.G.P. owns 750,000 founder shares (of which 277,174
founder shares and 97,826 founder shares, respectively, are subject to forfeiture to the extent that the over-allotment option is not
exercised in full or in part so that our initial stockholders will collectively own 20% of our issued and outstanding shares after this
offering). None of our initial stockholders has indicated any intention to purchase public units in this offering.
In
addition, our sponsor has committed to purchase from us an aggregate of 361,000 units (or up to 376,000 units depending on the extent
to which the underwriters’ over-allotment option is exercised), at $10.00 per unit for a total purchase price of $3,610,000 (or
up to $3,760,000 depending on the extent to which the underwriters’ over-allotment option is exercised). This purchase will
take place on a private placement basis simultaneously with the completion of our initial public offering. This issuance will be made
pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
No underwriting discounts or commissions will be paid with respect
to such sales.
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Item 16.
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Exhibits and Financial Statement Schedules.
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|
(a)
|
The following exhibits are filed as part of this Registration Statement:
|
|
Exhibit No.
|
|
Description
|
|
1.1**
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|
Form of Underwriting
Agreement.
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1.2**
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Business Combination Agreement
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3.1**
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Certificate of Incorporation.
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3.2**
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Form of Amended
and Restated Certificate of Incorporation.
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3.3**
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Bylaws.
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4.1**
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Specimen Unit Certificate.
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4.2**
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Specimen Common Stock
Certificate.
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4.3**
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Specimen Warrant Certificate.
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4.4**
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Form of Warrant
Agreement between American Stock Transfer & Trust Company, LLC and the Registrant.
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5.1**
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Opinion of Reed Smith
LLP.
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10.1**
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Form of
Letter Agreement from each of the Registrant’s officers, directors, sponsor, and A.G.P./Alliance Global Partners
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10.2**
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Form of Investment
Management Trust Agreement between American Stock Transfer & Trust Company, LLC and the Registrant.
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10.3*
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Promissory Note dated
June 9, 2021, issued to Western Acquisition Ventures Sponsor LLC
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10.4*
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Securities Subscription
Agreement, dated June 9, 2021, between the Registrant and Western Acquisition Ventures Sponsor LLC
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10.5*
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Form of Registration
Rights Agreement.
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10.6**
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Form of Subscription
agreement for prrivate placement units.
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10.7**
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Form of
Stock Escrow Agreement.
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10.9*
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Form of Indemnification
Agreement.
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14.1*
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Code of Ethics.
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23.1**
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Consent of Marcum LLP.
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23.2**
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Consent of Reed Smith
(included in Exhibit 5.1).
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24.1**
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Power of Attorney (included
on signature page of this Registration Statement).
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99.1*
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Audit committee charter.
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99.2*
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Compensation committee
charter.
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99.3*
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Nominating committee
charter.
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99.4*
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Consent of Stephen
Christoffersen.
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99.5*
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Form of Consent of Ade
Okunubi.
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99.6*
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Form of Consent of Ali
Jahangiri.
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99.7*
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Form of Consent of Robin
L. Smith.
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99.8*
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Form of Consent of Adam
K. Stern.
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* Previously filed.
** Filed herein.
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(a)
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The undersigned registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreements, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.
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|
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(b)
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Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
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|
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(c)
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The undersigned registrant hereby undertakes that:
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|
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(1)
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For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
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|
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(2)
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For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
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(3)
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For the purpose of determining liability under the Securities Act of 1933 to any purchaser, if the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
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(4)
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For the purpose of determining liability of a registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of an undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
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|
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(i)
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Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
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(ii)
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Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by an undersigned registrant;
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(iii)
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The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
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(iv)
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Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
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(d)
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The undersigned registrant hereby undertakes:
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(1)
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To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
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|
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(i)
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To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
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(ii)
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To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;
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(iii)
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To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.
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(2)
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That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
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(3)
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To remove from registration by means of a post-effective amendment any of the securities being registered that remain unsold at the termination of the offering.
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(4)
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That for the purpose of determining any liability under the Securities Act of 1933 in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
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(i)
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Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
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(ii)
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Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
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(iii)
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The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
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(iv)
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Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
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SIGNATURES
Pursuant to the requirements of the Securities
Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in New York, New York on the 1st day of December, 2021.
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WESTERN ACQUISITION VENTURES CORP.
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By:
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/s/ Stephen Christoffersen
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Name:
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Stephen Christoffersen
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Title:
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Chief Executive Officer
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person
whose signature appears below constitutes and appoints Stephen Christoffersen and William Lischak their true and lawful attorney-in-fact,
with full power of substitution and resubstitution for him and in their name, place and stead, in any and all capacities to sign any and
all amendments including pre- and post-effective amendments to this registration statement, any subsequent registration statement
for the same offering that may be filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and pre- or post-effective amendments
thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that said attorney-in-fact or their substitute, each acting alone, may lawfully do
or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities
Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.
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Name
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|
Position
|
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Date
|
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/s/ Stephen Christoffersen
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Chief Executive Officer
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December 1, 2021
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Stephen Christoffersen
|
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(Principal Executive Officer) and Secretary
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/s/ William Lischak
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Chief Financial Officer and Director
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December 1, 2021
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William Lischak
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(Principal Financial and Accounting Officer)
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Exhibit 1.1
10,000,000 Units
Western
Acquisition Ventures Corp.
UNDERWRITING AGREEMENT
New York, New York
[_], 2021
A.G.P./ Alliance Global Partners
590 Madison Avenue, 28th Floor, New York, NY 10022
As Representative of the Underwriters
named on Schedule A hereto
Ladies and Gentlemen:
Western Acquisition Ventures
Corp., a Delaware corporation (the “Company”), hereby confirms its agreement with A.G.P./Alliance Global Partners (the
“Representative”) and with the other underwriters named on Schedule A hereto (if any), for which the
Representative is acting as representative (the Representative and such other underwriters being collectively referred to herein as the
“Underwriters” or, each underwriter individually, an “Underwriter”), and with The Benchmark Company,
LLC acting as the qualified independent underwriter (the “QIU”), as follows:
1. Purchase
and Sale of Securities.
1.1. Units.
1.1.1. Purchase
of Units. On the basis of the representations and warranties herein contained, but subject to the terms and conditions herein
set forth, the Company agrees to issue and sell to the several Underwriters, severally and not jointly, an aggregate of 10,000,000
units of the Company (the “Firm Units”) and shall pay the Underwriter’s a fee of $500,000, which is inclusive of a fee of $100,000 payable to the QIU. Each Firm Unit
consists of one share of common stock, $0.0001 par value per share (the “Common Stock”), and one redeemable
warrant (the “Warrant(s)”) to purchase three-quarters of a share of Common Stock for $11.50 per whole share
(each, a “Unit”). The Common Stock and Warrants included in the Firm Units will not be separately tradable until
90 days after the date hereof unless the Representative informs the Company of its decision to allow earlier separate trading,
subject to the Company filing a Current Report on Form 8-K with the Securities and Exchange Commission (the
“Commission”) containing an audited balance sheet reflecting the Company’s receipt of the gross proceeds of
the Offering (defined below) and the sale of the Private Placement Units (defined below) and issuing a press release announcing when
such separate trading will begin; provided that no fractional Warrants will be issued upon separation of the Units and only whole
Warrants will trade. The Underwriters, severally and not jointly, agree to purchase from the Company the number of Firm Units set
forth opposite their respective names on Schedule A. The Firm Units are to be offered initially to the public (the
“Offering”) at the offering price of $10.00 per Firm Unit.
1.1.2. Payment
and Delivery. Delivery and payment for the Firm Units shall be made at 10:00 A.M., New York time, on the second (2nd)
Business Day following the commencement of trading of the Firm Units, or at such earlier time as shall be agreed upon by the Representative
and the Company at the offices of the Representative or at such other place as shall be agreed upon by the Representative and the Company.
The closing of the Offering is referred to herein as the “Closing” and the hour and date of delivery and payment for
the Firm Units is referred to herein as the “Closing Date.” Payment for the Firm Units shall be made on the Closing
Date through the facilities of Depository Trust Company (“DTC”) by wire transfer in Federal (same day) funds. The Company
shall receive an aggregate of approximately $103,610,000 of gross proceeds from the sale of the Firm Units and the Private Placement Units
(as defined in section 1.3.3), of which $101,000,000 shall be deposited on the Closing Date into the trust account (the “Trust
Account”) established by the Company for the benefit of the Public Stockholders, as described in the Registration Statement
(as defined in Section 2.1.1 below) and pursuant to the terms of an Investment Management Trust Agreement (the “Trust Agreement”)
between the Company and American Stock Transfer & Trust Company, LLC (“AST&T”) substantially in the form
annexed as an exhibit to the Registration Statement. The remaining proceeds (less actual expense payments or other fees payable pursuant
to this Agreement) shall be paid to the order of the Company upon delivery of certificates (in form and substance reasonably satisfactory
to the Representative) representing the Firm Units (or through the facilities of the DTC for the account of the Representative). The Firm
Units shall be registered in such name or names and in such authorized denominations as the Representative may request in writing at least
two (2) Business Days (defined below) prior to the Closing Date. The Company will permit the Representative to examine and package
the Firm Units for delivery at least one (1) full Business Day prior to the Closing Date. The Company shall not be obligated to sell
or deliver the Firm Units except upon tender of payment by the Representative for all the Firm Units. As used herein, the term “Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or
required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required
by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any
other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so
long as the electronic funds transfer systems (including for wire transfers) of commercial banks in New York, New York are generally are
open for use by customers on such day, and the term “Public Stockholders” means the holders of shares of Common Stock
sold in the Offering or acquired in the aftermarket, including any of the Respondents (defined below) to the extent they acquire such
shares of Common Stock in the Offering or in the aftermarket (and solely with respect to such shares).
1.2. Over-Allotment
Option
1.2.1. The
Representative shall have the option (the “Over-Allotment Option”) to purchase all or less than all of an additional
1,500,000 Units (the “Option Units”) solely for the purposes of covering any over-allotments in connection with the
distribution and sale of the Firm Units. Such Option Units shall, at the Representative’s election, be purchased for each account
of the several Underwriters in the same proportion as the number of Firm Units set forth opposite such Underwriter’s name on Schedule
A hereto (subject to adjustment by the Representative to eliminate fractions). Such Option Units shall be identical in all respects to
the Firm Units. The Firm Units and the Option Units (including the shares of Common Stock and warrants underlying such Firm Units and
Option Units) are hereinafter collectively referred to as the “Public Securities.” No Option Units shall be sold or
delivered unless the Firm Units previously have been, or simultaneously are, sold and delivered. The right to purchase the Option Units,
or any portion thereof, may be exercised from time to time and to the extent not previously exercised may be surrendered and terminated
at any time upon notice by the Representative to the Company. The purchase price to be paid for each Option Unit will be $10.00 per Option
Unit, and no underwriting discounts, commissions or placement fees have been or will be payable in connection with the Option Units.
1.2.2. Exercise
of Option. The Over-Allotment Option granted pursuant to Section 1.2.1 hereof may be exercised by the Representative as to all
(at any time) or any part (from time to time) of the Option Units within forty-five (45) days after the Effective Date. The Representative
will not be under any obligation to purchase any Option Units prior to the exercise of the Over-Allotment Option. The Over-Allotment Option
granted hereby may be exercised by the giving of oral notice to the Company by the Representative, which must be confirmed in accordance
with Section 11.1 herein setting forth the number of Option Units to be purchased and the date and time for delivery of and payment
for the Option Units, if other than the Closing Date (the “Option Closing Date”), which shall not be earlier than the
Closing Date or be later than ten (10) full Business Days after the date of the notice or such other time as shall be agreed upon
by the Company and the Representative, at the offices of the Representative or at such other place as shall be agreed upon by the Company
and the Representative. Upon exercise of the Over-Allotment Option, the Company will become obligated to convey to the Representative,
and, subject to the terms and conditions set forth herein, the Representative will become obligated to purchase, the number of Option
Units specified in such notice.
1.2.3. Payment
and Delivery. Payment for the Option Units shall be made on the Option Closing Date at the Representative’s election by wire
transfer in Federal (same day) funds or by certified or bank cashier’s check(s) in New York Clearing House funds, payable as
follows: $10.00 per Option Unit shall be deposited in the Trust Account pursuant to the Trust Agreement upon delivery of certificates
(in form and substance satisfactory to the Representative) representing the Option Unit (or through the facilities of DTC) for the account
of the Representative). The certificates representing the Option Units to be delivered will be in such denominations and registered in
such names as the Representative requests in writing not less than two full business days prior to the Closing Date or the Option Closing
Date, as the case may be, and will be made available to the Representative for inspection, checking and packaging at the aforesaid office
of the Company’s transfer agent or correspondent not less than one full business day prior to such Closing Date. The Company shall
not be obligated to sell or deliver the Option Units except upon tender of payment by the Representative for the applicable Option Units.
1.3. Private
Placements.
1.3.1. In
June 2021, the Company issued to Western Acquisition Ventures Sponsor LLC (the “Sponsor”), for consideration of
$25,000.00, 4,312,500 shares (the “Founder Shares”) of Common Stock, including an aggregate of 1,207,000 shares of
Common Stock which were subsequently transferred by the Sponsor to the Representative (the “Representative’s Shares”),
in a private placement intended to be exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended
(the “Act”). On November 22, 2021, the Company effected a 2:3 split of our common stock, and the Representative
sold back to the Sponsor 55,000 founder shares, such that the Sponsor owns 2,125,000 founder shares, and the Representative owns 750,000
founder shares. No underwriting discounts, commissions or placement fees have been or will be payable in connection with the sale of the
Founder Shares. The Founder Shares shall be held in escrow and subject to restrictions on transfer as set forth in the Registration Statement.
The holders of the Founder Shares (i) shall have no right to any liquidation distributions with respect to any portion of the Founder
Shares in the event the Company fails to consummate any proposed initial merger, share exchange, asset acquisition, share purchase, recapitalization,
reorganization or other similar business combination, or entering into contractual arrangements, with one or more businesses or entities
(“Business Combination”) within the required time period except with respect to any funds held outside of the Trust
Account remaining after payment of all fees and expenses, (ii) shall not be entitled to exercise
any redemption rights with respect to such Founder Shares and (iii) shall not be entitled to sell any such shares to the Company
in any tender offer in connection with a proposed Business Combination. To the extent that the Over-Allotment Option is not exercised
by the Underwriters in full or in part, up to 375,000 of the Founder Shares (including 97,826 of the Representative’s Shares) shall
be forfeited in an amount necessary to maintain the holders of Founder Shares’ aggregate 20% ownership interest in the issued and
outstanding shares of the Company after giving effect to the Offering and exercise, if any, of the Underwriters’ Over-Allotment
Option (excluding any shares purchased in the Offering and any Private Shares purchased in the Private Placement by the Respondents).
1.3.2. The
holders of the Representative’s Shares will not sell, transfer, assign, pledge or hypothecate any of the Representative’s
Shares for a period of 180 days pursuant to FINRA Conduct Rule 5110(e)(1) following the effective date of the Registration Statement
to anyone other than (i) the Representative or an Underwriter or selected dealer in connection with the Offering, or (ii) a
bona fide officer or partner of the Representative or of any such Underwriter or selected dealer. Additionally, pursuant to FINRA Conduct
Rule 5110(e), the Representative’s Shares will not be the subject of any hedging, short sale, derivative, put or call transaction
that would result in the economic disposition of the securities by any person for a period of 180 days immediately following the effective
date of the Registration Statement. The certificates for the Representative’s Shares shall contain legends to reflect the above
FINRA and contractual transfer restrictions. The holders of the Representative’s Shares shall have registration rights as provided
for in the Registration Rights Agreement (as defined in Section 2.24.5).
1.3.3. Simultaneously
with the Closing Date, the Sponsor will purchase from the Company, pursuant to the Subscription Agreement (as defined in Section 2.24.2
below), an aggregate of 361,000 units (the “Private Placement Units”), each consisting of one share of Common Stock
(the “Private Shares”) and one warrant to purchase three-quarters of a share of Common Stock for $11.50 per whole share (the
“Private Placement Warrants” and together with the Private Placement Units and Private Shares, the “Private
Securities”)), at a purchase price of $10.00 per Private Placement Unit in a private placement (the “Private Placement”)
intended to be exempt from registration under the Act. Simultaneously with the Option Closing Date, the Sponsor will purchase from the
Company, pursuant to the Subscription Agreement, up to 15,000 additional Private Placement Units, at a purchase price of $10.00 per Private
Placement Unit in a Private Placement. The terms of the Private Placement Units, Private Shares, and Private Placement Warrants are as
described in the Prospectus (as defined in Section 2.1.1 below). No underwriting discounts, commissions or placement fees have been
or will be payable in connection with the Private Placement.
1.4. Working
Capital; Trust Account Proceeds.
1.4.1. Working
Capital. Upon consummation of the Offering, it is intended that approximately $2,610,000 of the proceeds from the sale of the Firm
Units, the Option Units, if any, and Private Placement Units will be released to the Company
to fund the working capital requirements of the Company.
1.4.2. Trust
Account Proceeds. Prior to the liquidation of the Trust Account in the event the Company has not completed a Business Combination
as required by its Charter Documents (the “Termination Date”), interest income on the funds held in the Trust Account
may be released to the Company from the Trust Account in accordance with the terms of the Trust Agreement to pay any taxes incurred by
the Company and up to $100,000 of accrued interest to pay dissolution costs and expenses, all as more fully described in the Prospectus.
2. Representations
and Warranties of the Company. The Company represents and warrants to the Underwriters and the QIU as follows:
2.1. Filing
of Registration Statement.
2.1.1. Pursuant
to the Act. The Company has filed with the Securities and Exchange Commission (the “Commission”) a registration
statement and an amendment or amendments thereto, on Form S-1 (File No. 333- 260384), including any related preliminary prospectus
(the “Preliminary Prospectus”, including any prospectus that is included in the registration statement immediately
prior to the effectiveness of the registration statement), for the registration of the Public Securities under the Act, which registration
statement and amendment or amendments have been prepared by the Company in conformity with the requirements of the Act, and the rules and
regulations (the “Regulations”) of the Commission under the Act. Except as the context may otherwise require, such
registration statement, as amended, on file with the Commission at the time the registration statement became effective (“Effective
Date”) (including the prospectus, financial statements, schedules, exhibits and all other documents filed as a part thereof
or incorporated therein and all information deemed to be a part thereof as of such time pursuant to Rule 430A of the Regulations),
is hereinafter called the “Registration Statement,” and the form of the final prospectus dated the Effective Date included
in the Registration Statement (or, if applicable, the form of final prospectus containing information permitted to be omitted at the time
of effectiveness by Rule 430A of the Regulations, filed by the Company with the Commission pursuant to Rule 424 of the Regulations),
is hereinafter called the “Prospectus.” For purposes of this Agreement, “Time of Sale,” as used
in the Act, means 5:00 p.m. New York City time, on the date of this Agreement. Prior to the Time of Sale, the Company prepared a
Preliminary Prospectus, which was included in the Registration Statement filed on [_______], 2021, for distribution by the Underwriter
(such Preliminary Prospectus used most recently prior to the Time of Sale, the “Statutory Prospectus”). The Company
has filed a Registration Statement pursuant to Rule 462(b) under the Act registering additional securities (a “Rule 462(b) Registration
Statement”), and accordingly, unless otherwise specified, any reference herein to the term “Registration Statement”
shall be deemed to include such 462(b) Registration Statement. Other than a Rule 462(b) Registration Statement, which became
effective upon filing, no other document with respect to the Registration Statement has been filed with the Commission. All of the Public
Securities have been or will be registered under the Act pursuant to the Registration Statement. The Registration Statement has been declared
effective by the Commission on the date hereof. If, subsequent to the date of this Agreement, the Company or the Representative has determined
that at the Time of Sale the Statutory Prospectus included an untrue statement of a material fact or omitted a statement of material fact
necessary to make the statements therein, in light of the circumstances under which they were made, not misleading and have agreed to
provide an opportunity to purchasers of the Firm Units to terminate their old purchase contracts and enter into new purchase contracts,
then the Statutory Prospectus will be deemed to include any additional information available to purchasers at the time of entry into the
first such new purchase contract.
2.1.2. Pursuant
to the Exchange Act. The Company has filed with the Commission a Registration Statement on Form 8-A (File Number 001-[____])
providing for the registration under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), of the Public
Securities. The registration of the Public Securities under the Exchange Act has been declared effective by the Commission on the date
hereof.
2.2. No
Stop Orders, etc. Neither the Commission nor, to the Company’s knowledge, any federal or state regulatory authority has
issued any order or threatened to issue any order preventing or suspending the use of any Statutory Prospectus or Prospectus or has instituted
or, to the best of the Company’s knowledge, threatened to institute any proceedings with respect to such an order.
2.3. Disclosures
in Registration Statement.
2.3.1. 10b-5
Representation. At the time of effectiveness of the Registration Statement (or at the effective time of any post-effective amendment
to the Registration Statement) and at all times subsequent thereto up to the Closing Date, the Registration Statement, the Statutory Prospectus
and the Prospectus contained or will contain all material statements that are required to be stated therein in accordance with the Act
and the Regulations, and did or will, in all material respects, conform to the requirements of the Act and the Regulations. On the Effective
Date and at the Time of Sale, the Registration Statement did not, and on the Closing Date it will not, contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein not
misleading; on the date of any filing pursuant to Rule 424(b) and on the Closing Date, the Prospectus (together with any supplement
thereto) will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not misleading; and at the Time of Sale, the Statutory Prospectus does
not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading; provided, however, that the representation and warranty made
in this Section 2.3.1 does not apply to statements made or statements omitted in reliance upon and in conformity with written information
furnished to the Company with respect to the Underwriters by the Underwriters expressly for use in the Registration Statement, the Statutory
Prospectus or Prospectus or any amendment thereof or supplement thereto, which information, it is agreed, shall consist solely of the
names of the Underwriters, and the subsections titled “Stabilization” and “Selling Restrictions” included in the
section captioned “Underwriting——Conflicts of Interest.”
2.3.2. Disclosure
of Agreements. The agreements and documents described in the Registration Statement, the Statutory Prospectus and the Prospectus conform
to the descriptions thereof contained therein in all material respects and there are no agreements or other documents required to be described
in the Registration Statement, the Statutory Prospectus or the Prospectus or to be filed with the Commission as exhibits to the Registration
Statement, that have not been so described or filed. Each agreement or other instrument (however characterized or described) to which
the Company is a party or by which its property or business is or may be bound or affected and (i) that is referred to in the Registration
Statement or attached as an exhibit thereto, or (ii) is material to the Company’s business, has been duly and validly executed
by the Company, is in full force and effect in all material respects and is enforceable against the Company and, to the Company’s
knowledge, the other parties thereto, in all material respects in accordance with its terms, except (x) as such enforceability may
be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (y) as enforceability
of any indemnification or contribution provision may be limited under the foreign, federal and state securities laws, and (z) that
the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to
the discretion of the court before which any proceeding therefor may be brought, and none of such agreements or instruments has been assigned
by the Company, and neither the Company nor, to the Company’s knowledge, any other party is in breach or default thereunder and,
to the Company’s knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute
a breach or default thereunder. To the Company’s knowledge, performance by the Company of the material provisions of such agreements
or instruments will not result in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental
agency or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation,
those relating to environmental laws and regulations.
2.3.3. Prior
Securities Transactions. No securities of the Company have been sold by the Company or by or on behalf of, or for the benefit of,
any person or persons controlling, controlled by, or under common control with the Company since the date of the Company’s incorporation,
except as disclosed in the Registration Statement.
2.3.4. Regulations.
The disclosures in the Registration Statement, the Statutory Prospectus and the Prospectus concerning the effects of foreign, federal,
state and local regulation on the Company’s business as currently contemplated are correct in all material respects and do not omit
to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.
2.4. Changes
After Dates in Registration Statement.
2.4.1. No
Material Adverse Change. Since the respective dates as of which information is given in the Registration Statement, the Statutory
Prospectus and the Prospectus, except as otherwise specifically stated therein: (i) there has been no material adverse change in
the condition, financial or otherwise, or business prospects of the Company; (ii) there have been no material transactions entered
into by the Company, other than as contemplated pursuant to this Agreement; (iii) no member of the Company’s board of directors
or management has resigned from any position with the Company; and (iv) no event or occurrence has taken place which materially impairs,
or would likely materially impair, with the passage of time, the ability of the members of the Company’s board of directors or management
to act in their capacities with the Company as described in the Registration Statement, the Statutory Prospectus and the Prospectus.
2.4.2. Recent
Securities Transactions, etc. Except as set forth in or contemplated by the Registration Statement, Statutory Prospectus, and
the Prospectus, subsequent to the respective dates as of which information is given in the Registration Statement, the Statutory Prospectus
and the Prospectus and except as may otherwise be indicated or contemplated herein or therein, the Company has not: (i) issued any
securities or incurred any liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend
or made any other distribution on or in respect to its shares.
2.5. Independent
Accountants. To the Company’s knowledge, Marcum LLP (“Accountant”), whose report is filed with the Commission
as part of the Registration Statement and included in the Registration Statement, the Statutory Prospectus and the Prospectus, are independent
registered public accountants as required by the Act, the Regulations and the Public Company Accounting Oversight Board (the “PCAOB”),
including the rules and regulations promulgated by such entity. To the Company’s knowledge, Accountant is duly registered and
in good standing with the PCAOB. Accountant has not, during the periods covered by the financial statements included in the Registration
Statement, the Statutory Prospectus and the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of
the Exchange Act.
2.6. Financial
Statements; Statistical Data.
2.6.1. Financial
Statements. The financial statements, including the notes thereto and supporting schedules included in the Registration Statement,
the Statutory Prospectus and the Prospectus, fairly present in all material respects the financial position and the results of operations
of the Company at the dates and for the periods to which they apply; and such financial statements have been prepared in conformity with
United States generally accepted accounting principles (“GAAP”), consistently applied throughout the periods involved;
and the supporting schedules included in the Registration Statement present fairly in all material respects the information required to
be stated therein in conformity with the Regulations. No other financial statements or supporting schedules are required to be included
or incorporated by reference in the Registration Statement, the Statutory Prospectus or the Prospectus. The Registration Statement, the
Statutory Prospectus and the Prospectus disclose all material off-balance sheet transactions, arrangements, obligations (including contingent
obligations), and other relationships of the Company with unconsolidated entities or other persons that may have a material current or
future effect on the Company’s financial condition, changes in financial condition, results of operations, prospects, liquidity,
capital expenditures, capital resources, or significant components of revenues or expenses. There are no pro forma or as adjusted financial
statements which are required to be included in the Registration Statement, the Statutory Prospectus or the Prospectus in accordance with
Regulation S-X of the Regulations which have not been included as so required.
2.6.2. Statistical
Data. The statistical, industry-related and market-related data included in the Registration Statement, the Statutory Prospectus and/or
the Prospectus are based on or derived from sources which the Company reasonably and in good faith believes are reliable and accurate,
and such data agree with the sources from which they are derived.
2.7. Authorized
Capital; Options, etc. The Company had at the date or dates indicated in each of the Registration Statement, the Statutory Prospectus
and the Prospectus, as the case may be, duly authorized, issued and outstanding capitalization as set forth in the Registration Statement,
the Statutory Prospectus and the Prospectus. Based on the assumptions stated in the Registration Statement, the Statutory Prospectus and
the Prospectus, the Company will have on the Closing Date the adjusted share capitalization set forth therein. Except as set forth in,
or contemplated by, the Registration Statement, the Statutory Prospectus and the Prospectus, on the Effective Date and on the Closing
Date, there will be no options, warrants, or other rights to purchase or otherwise acquire any authorized, but unissued shares of Common
Stock or any security convertible into shares of Common Stock, or any contracts or commitments to issue or sell shares of Common Stock
or any such options, warrants, rights or convertible securities.
2.8. Valid
Issuance of Securities, etc.
2.8.1. Outstanding
Securities. All issued and outstanding securities of the Company have been duly authorized and validly issued and are fully paid and
non-assessable; the holders thereof have no rights of rescission with respect thereto, and are not subject to personal liability by reason
of being such holders; and none of such securities were issued in violation of the preemptive rights of any holders of any security of
the Company or similar contractual rights granted by the Company. The outstanding securities of the Company conform in all material respects
to the descriptions thereof contained in the Registration Statement, the Statutory Prospectus and the Prospectus. All offers, sales and
any transfers of the outstanding securities of the Company were at all relevant times either registered under the Act and the applicable
state securities or Blue Sky laws (based in part on the representations and warranties of the purchasers of the Company’s securities)
or exempt from such registration requirements.
2.8.2. Securities
to be Sold.
2.8.2.1. The
Public Securities have been duly authorized and reserved for issuance and when issued and paid for in accordance with this Agreement,
will be validly issued, fully paid and non-assessable; the holders thereof are not and will not be subject to personal liability by reason
of being such holders; the Public Securities are not and will not be subject to the preemptive rights of any holders of any security of
the Company or similar contractual rights granted by the Company; and all corporate action required to be taken for the authorization,
issuance and sale of the Public Securities has been duly and validly taken. The Public Securities conform in all material respects to
the descriptions thereof contained in the Registration Statement, the Statutory Prospectus and the Prospectus, as the case may be.
2.8.2.2. The
Private Securities (and underlying securities) have been duly authorized and reserved for issuance and when issued and paid for in accordance
with the Subscription Agreement (defined below), will be validly issued, fully paid and non-assessable; the holders thereof are not and
will not be subject to personal liability by reason of being such holders; the Private Securities
are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted
by the Company; and all corporate action required to be taken for the authorization, issuance and sale of the Private
Securities has been duly and validly taken. The Private Securities conform in all
material respects to the descriptions thereof contained in the Registration Statement, the Statutory Prospectus and the Prospectus, as
the case may be. The offer and sale of the Private Securities was exempt from the registration requirements of the Act.
2.8.2.3. The
Founder Shares (including the Representative’s Shares) have been duly authorized, duly and validly issued, fully paid and non-assessable;
the holders thereof are not and will not be subject to personal liability by reason of being such holders; the Founder Shares (including
the Representative’s Shares) are not and will not be subject to the preemptive rights of any holders of any security of the Company
or similar contractual rights granted by the Company; and all corporate action required to be taken for the authorization, issuance and
sale of the Founder Shares (including the Representative’s Shares) has been duly and validly taken. The Founder Shares (including
the Representative’s Shares) conform in all material respects to the descriptions thereof contained in the Registration Statement,
the Statutory Prospectus and the Prospectus, as the case may be.
2.8.3. No
Integration. Neither the Company nor any of its affiliates has, prior to the date hereof, made any offer or sale of any securities
which are required to be “integrated” pursuant to the Act or the Regulations with the offer and sale of the Public Securities
pursuant to the Registration Statement.
2.9. Registration
Rights of Third Parties. Except as set forth in the Registration Statement, the Statutory Prospectus and the Prospectus, no holders
of any securities of the Company or any rights exercisable for or convertible or exchangeable into securities of the Company have the
right to require the Company to register any such securities of the Company under the Act or to include any such securities in a registration
statement to be filed by the Company.
2.10. Validity
and Binding Effect of Agreements. This Agreement, the Investment Management Trust Agreement, the Subscription Agreement, the Administrative
Services Agreement (as defined in Section 2.24.6 below), the Warrant Agreement, the Stock Escrow Agreement (as defined in Section 2.24.7)
and the Registration Rights Agreement (collectively, the “Transaction Documents”) have been duly and validly authorized
by the Company and, when executed and delivered by the Company and the other parties thereto, will constitute valid and binding agreements
of the Company, enforceable against the Company in accordance with their respective terms, except: (i) as such enforceability may
be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability
of any indemnification or contribution provision may be limited under foreign, federal and state securities laws; and (iii) that
the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to
the discretion of the court before which any proceeding therefor may be brought.
2.11. No
Conflicts, etc. The execution, delivery, and performance by the Company of the Transaction Documents, the consummation by the
Company of the transactions herein and therein contemplated and the compliance by the Company with the terms hereof and thereof do not
and will not, with or without the giving of notice or the lapse of time or both: (i) result in a breach or violation of, or conflict
with any of the terms and provisions of, or constitute a default under, or result in the creation, modification, termination or imposition
of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any agreement, obligation, condition,
covenant or instrument to which the Company is a party or bound or to which its property is subject except pursuant to the Trust Agreement;
(ii) result in any violation of the provisions of the Certificate of Incorporation of the Company, as amended (collectively, the
“Charter Documents”); or (iii) violate any existing applicable statute, law, rule, regulation, judgment, order
or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its properties, business,
or assets, except in the case of clauses (i) and (iii), for breaches or violations that would not reasonably be excepted to have
a Material Adverse Effect (defined below) on the Company.
2.12. No
Defaults; Violations. No material default or violation exists in the due performance and observance of any term, covenant or condition
of any material license, contract, indenture, mortgage, deed of trust, note, loan or credit agreement, or any other agreement or instrument
evidencing an obligation for borrowed money, or any other material agreement or instrument to which the Company is a party or by which
the Company may be bound, or to which any of the properties or assets of the Company is subject. The Company is not in violation of any
term or provision of its Charter Documents, or in violation of any franchise, license, permit, applicable law, rule, regulation, judgment
or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its properties or businesses,
except for such violations that would not reasonably be expected to have a Material Adverse Effect on the Company.
2.13. Corporate
Power; Licenses; Consents.
2.13.1. Conduct
of Business. The Company has all requisite corporate power and authority, and has all necessary authorizations, approvals, orders,
licenses, certificates and permits of and from all governmental regulatory officials and bodies that it needs as of the date hereof to
conduct its business for the purposes described in the Registration Statement, the Statutory Prospectus and the Prospectus. The disclosures
in the Registration Statement, the Statutory Prospectus and the Prospectus concerning the effects of foreign, federal, state and local
regulation on this Offering and the Company’s business purpose as currently contemplated are correct in all material respects and
do not omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. Since its incorporation and except as described in the Registration Statement,
the Company has conducted no business and has incurred no liabilities other than in connection with its incorporation and in furtherance
of the Offering.
2.13.2. Transactions
Contemplated Herein. The Company has all corporate power and authority to enter into this Agreement and to carry out the provisions
and conditions hereof, and all consents, authorizations, approvals and orders required in connection therewith have been obtained. No
consent, authorization or order of, and no filing with, any court, government agency or other body, foreign or domestic, is required for
the valid issuance, sale and delivery, of the Public Securities, Private Securities and Founder Shares (including the Representative’s
Shares) and the consummation of the transactions and agreements contemplated by the Transaction Documents and as contemplated by the Registration
Statement, the Statutory Prospectus and Prospectus, except with respect to applicable foreign, federal and state securities laws and the
rules and regulations promulgated by the Financial Industry Regulatory Authority, Inc. (“FINRA”).
2.14. D&O
Questionnaires. To the Company’s knowledge, all information contained in the questionnaires (the “Questionnaires”)
completed by each of the Company’s officers and directors (the “Respondents”) immediately prior to the initial
filing of the Registration Statement and provided to the Representative, as such Questionnaires may have been updated from time to time
and confirmed by each of the Respondents, as well as in the biographies previously provided to the Representative, is true and correct
in all material respects and the Company has not become aware of any information which would cause the information disclosed in the Questionnaires
to become materially inaccurate and incorrect.
2.15. Litigation;
Governmental Proceedings. There is no action, suit, proceeding, inquiry, arbitration, investigation, litigation or governmental proceeding
pending or, to the Company’s knowledge, threatened against, or involving the Company or, to the Company’s knowledge, any of
the Respondents, which has not been disclosed in the Registration Statement, the Statutory Prospectus and the Prospectus.
2.16. Good
Standing. The Company has been duly organized and is validly existing as a corporation and is in good standing under the laws of its
jurisdiction of incorporation and is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction
in which its ownership or lease of property or the conduct of business requires such qualification, except where the failure to qualify
would not have a material adverse effect on the condition (financial or otherwise), prospects, earnings, business or properties of the
Company, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Statutory
Prospectus and the Prospectus (exclusive of any supplement thereto) (a “Material Adverse Effect”).
2.17. No
Contemplation of a Business Combination. The Company does not have any specific Business Combination under consideration and it has
not (nor has anyone on its behalf), directly or indirectly, contacted any prospective business (each, a “Target Business”)
or had any substantive discussions, formal or otherwise, with respect to such a transaction.
2.18. Transactions
Affecting Disclosure to FINRA.
2.18.1. To
the Company’s knowledge, all information contained in the questionnaires (the “FINRA Questionnaires”) completed
by each of the Respondents and provided to the Representative, as such FINRA Questionnaires may have been updated from time to time and
confirmed by each of the Respondents, is true and correct in all material respects and the Company has not become aware of any information
which would cause the information disclosed in the FINRA Questionnaires to become materially inaccurate and incorrect.
2.18.2. Except
as described in the Registration Statement, the Statutory Prospectus and the Prospectus, there are no claims, payments, arrangements,
agreements or understandings relating to the payment of a finder’s, consulting or origination fee by the Company or any Company
Affiliate (defined below) with respect to the sale of the Public Securities hereunder, the sale of the Private Securities or the Founder
Shares (including the Representative’s Shares) or any other arrangements, agreements or understandings of the Company or, to the
Company’s knowledge, any Respondent that may affect the Underwriters’ compensation, as determined by FINRA.
2.18.3. Except
as described herein or in the Registration Statement, the Statutory Prospectus and the Prospectus, the Company has not made any direct
or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s fee, consulting fee or otherwise,
in consideration of such person raising capital for the Company or introducing to the Company persons who raised or provided capital to
the Company; (ii) to any “participating member,” as defined in FINRA Rule 5110, with respect to the Offering (“Participating
Member”); or (iii) to any person or entity that has any direct or indirect affiliation or association with any Participating
Member, within the 180-day period prior to the confidential filing of the Registration Statement with the Commission.
2.18.4. To
the Company’s knowledge, except as set forth in the FINRA Questionnaires, no officer or director or any direct or indirect beneficial
owner of 10% or greater of any class of the Company’s securities, including the Respondents and holders of securities to be purchased
in the Private Placement (whether debt or equity, registered or unregistered, regardless of the time acquired or the source from which
derived) (any such individual or entity, a “Company Affiliate”) is a Participating Member, or a person associated or
affiliated with a Participating Member.
2.18.5. To
the Company’s knowledge, except as set forth in the FINRA Questionnaires, no Company Affiliate is an owner of stock or other securities
of a Participating Member (other than securities purchased on the open market).
2.18.6. To
the Company’s knowledge, except as set forth in the FINRA Questionnaires, no Company Affiliate has made a subordinated loan to any
Participating Member.
2.18.7. No
proceeds from the sale of the Public Securities or Private Securities (excluding underwriting
compensation) will be paid to any Participating Member, or any persons associated or affiliated with a Participating Member, except as
specifically authorized herein.
2.18.8. Other
than the Representative’s Shares, the Company has not issued any warrants or other securities, or granted any options, directly
or indirectly to anyone who is a Participating Member within the 180-day period prior to the initial filing date of the Registration Statement
with the Commission, except as disclosed in the Registration Statement, the Statutory Prospectus and the Prospectus.
2.18.9. To
the Company’s knowledge, except as set forth in the FINRA Questionnaires, no person to whom securities of the Company have been
privately issued within the 180-day period prior to the initial filing date of the Registration Statement with the Commission has any
relationship or affiliation or association with any Participating Member.
2.18.10. To
the Company’s knowledge, except as described in the Registration Statement, the Statutory Prospectus and the Prospectus, no Participating
Member has a conflict of interest (as defined by FINRA rules) with the Company.
2.18.11. Except
with respect to the Representative in connection with the Offering, the Company has not entered into any agreement or arrangement (including,
without limitation, any consulting agreement or any other type of agreement) during the 180-day period prior to the initial filing date
of the Registration Statement with the Commission, which arrangement or agreement provides for the receipt of any item of value and/or
the transfer or issuance of any warrants, options, or other securities from the Company to a Participating Member, any person associated
with a Participating Member, any potential underwriters in the Offering and/or any related persons.
2.19. Taxes.
2.19.1. There
are no transfer taxes or other similar fees or charges under U.S. federal law or the laws of any U.S. state or any political subdivision
thereof, required to be paid in connection with the execution and delivery of this Agreement or the issuance or sale by the Company of
the Public Securities.
2.19.2. The
Company has filed all U.S. federal, state and local tax returns that are required to be a filed or has requested extensions thereof, except
in any case in which the failure to so file would not have a Material Adverse Effect, and has paid all taxes required to be paid by it
and any other assessment, fine or penalty levied against it, to the extent that any of the foregoing in due and payable, except for any
such assessment, fine or penalty that is currently being contested in good faith or as would not have a Material Adverse Effect.
2.20. Foreign
Corrupt Practices Act. Neither the Company nor, to the Company’s knowledge, any of the Respondents or any other person acting
on behalf of the Company is aware of or has taken any action, directly or indirectly, that: (i) would result in a violation by such
persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the “FCPA”)
or otherwise subject the Company to any damage or penalty in any civil, criminal or governmental litigation or proceeding; (ii) if
not done in the past, might reasonably be expected to have had a Material Adverse Effect or (iii) if not continued in the future,
might reasonably be expected to materially and adversely affect the assets, business or operations of the Company, including, without
limitation, given or agreed to give any money, gift or similar benefit (other than legal price concessions to customers in the ordinary
course of business) to any customer, supplier, employee or agent of a customer or supplier, or official or employee of any governmental
agency or instrumentality of any government (domestic or foreign) or any political party or candidate for office (domestic or foreign)
or any political party or candidate for office (domestic or foreign) or other person who was, is, or may be in a position to help or hinder
the business of the Company (or assist it in connection with any actual or proposed transaction). The Company’s internal accounting
controls and procedures are sufficient to cause the Company to comply with the FCPA.
2.21. Currency
and Foreign Transactions Reporting Act. The operations of the Company are and have been conducted at all times in material compliance
with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transaction Reporting Act of 1970, as amended,
the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”)
and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company
with respect to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.
2.22. Bank
Secrecy Act; Money Laundering; Patriot Act. Neither the Company, nor to the Company’s knowledge, any Company Affiliate, has
violated: (i) the Bank Secrecy Act, as amended, (ii) the Money Laundering Laws or (iii) the Uniting and Strengthening of
America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, and/or the rules and
regulations promulgated under any such law, or any successor law.
2.23. Officers’
Certificate. Any certificate signed by any duly authorized officer of the Company and delivered to the Representative or to the Representative’s
counsel shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
2.24. Agreements
with Certain Company Affiliates.
2.24.1. Letter
Agreement. The Company has caused to be duly executed legally binding and enforceable agreements (except (i) as such enforceability
may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (ii) as enforceability
of any indemnification contribution provision may be limited under foreign, federal and state securities laws, and (iii) that the
remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought) in the form annexed as an exhibit to the Registration Statement
(the “Letter Agreements”), pursuant to which each of the Respondents agrees to certain matters, including but not limited
to, the voting of the securities held by them and certain matters described as being agreed to by them under the “Proposed Business”
section of the Registration Statement, the Statutory Prospectus, and the Prospectus.
2.24.2. Subscription
Agreement. The Sponsor has executed and delivered a subscription agreement, the form of which
is annexed as an exhibit to the Registration Statement (the “Subscription Agreement”), pursuant to which the
Sponsor has agreed, among other things, that it will purchase on the Closing Date the Private Placement
Units in the Private Placement. Pursuant to the Subscription Agreement, the Sponsor has waived any and all rights and claims it may have
to any proceeds, and any interest thereon, held in the Trust Account in respect of the shares of Common Stock underlying the Private Placement
Units in the event that a Business Combination is not consummated and the Trust Account is liquidated in accordance with the terms of
the Investment Management Trust Agreement. The Sponsor has agreed not to transfer any ownership interest in, except to permitted
transferees or in certain limited circumstances, the Private Securities until at least 30 days following the completion of the Business
Combination.
2.24.3. Non-Competition/Solicitation.
To the Company’s knowledge, no Respondent is subject to any non-competition agreement or non-solicitation agreement with any employer
or prior employer which could materially affect such Respondent’s ability to be and act in the capacity of a director or officer
of the Company, as applicable.
2.24.4. Loans.
The Sponsor agreed to make loans to the Company in the aggregate amount of up to $300,000, as described in the Registration Statement
(the “Insider Loan”). The Insider Loan does not bear any interest and shall be repaid by the Company on the consummation
of the Offering.
2.24.5. Registration
Rights Agreement. The Company, the Sponsor and the Representative have entered into a registration rights agreement (“Registration
Rights Agreement”) substantially in the form annexed as an exhibit to the Registration Statement, whereby such parties will
be entitled to certain registration rights with respect to their securities, as set forth in such Registration Rights Agreement and described
more fully in the Registration Statement.
2.24.6. Reserved.
2.24.7. Stock
Escrow Agreement. The Company has caused the holders of the Founder Shares to enter into an escrow agreement (the “Stock
Escrow Agreement”) with AST&T substantially in the form filed as an exhibit to the Registration Statement whereby the Founder
Shares (including the Representative’s Shares) will be held in escrow by AST&T for a period (the “Escrow Period”)
commencing on the Effective Date and expiring on the earlier of the one year anniversary of the consummation of the Business Combination
and the date on which the closing price of the shares of Common Stock exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations,
reorganizations, recapitalizations and other similar transactions) for any 20 trading days within a 30-trading day period commencing at
least 150 days following the consummation of the Business Combination, or earlier in each case in certain limited situations. During the
Escrow Period, such parties shall be prohibited from selling or otherwise transferring such Founder Shares, except in certain limited
circumstances set forth in the Escrow Agreement. To the Company’s knowledge, the Escrow Agreement is enforceable against the holders
of Founder Shares and will not, with or without the giving of notice or the lapse of time or both, result in a breach of, or conflict
with, any of the terms and provisions of, or constitute a default under, an agreement or instrument to which the holders of the Founder
Shares is a party.
2.25. Investment
Management Trust Agreement. The Company has entered into the Trust Agreement with respect to certain proceeds of the Offering and
the Private Placement substantially in the form filed as an exhibit to the Registration Statement, pursuant to which the funds held in
the Trust Account may be released under limited circumstances. The Trust Agreement shall not be amended, modified or otherwise changed
in any way that modifies the rights or obligations of the Company without the prior written consent of the Representative.
2.26. Intentionally
Omitted.
2.27. Warrant
Agreement. The Company has entered into a warrant agreement with respect to the Warrants, the Private Placement Warrants and any other
warrants that may be issued by the Company with AST&T substantially in the form filed as an exhibit to the Registration Statement
(the “Warrant Agreement”).
2.28. Investments.
No more than 45% of the “value” (as defined in Section 2(a)(41) of the Investment Company Act of 1940 (“Investment
Company Act”)) of the Company’s total assets (exclusive of cash items and “Government Securities,” as defined
in Section 2(a)(16) of the Investment Company Act) consist of, and no more than 45% of the Company’s net income after taxes
is derived from, securities other than Government Securities.
2.29. Investment
Company Act. The Company is not required, and upon the issuance and sale of the Public Securities as herein contemplated and the application
of the net proceeds therefrom as described in the Prospectus will not be required, to register as an “investment company”
under the Investment Company Act.
2.30. Subsidiaries.
The Company does not own an interest in any corporation, partnership, limited liability company, joint venture, trust or other business
entity.
2.31. Related
Party Transactions. No relationship, direct or indirect, exists between or among any of the Company or any Company Affiliate, on the
one hand, and any director, officer, customer or supplier of the Company or any Company Affiliate, on the other hand, which is required
by the Act, the Exchange Act or the Regulations to be described in the Registration Statement, the Statutory Prospectus and the Prospectus,
which is not so described as required. There are no outstanding loans, advances or guarantees of indebtedness by the Company to or for
the benefit of any of the officers or directors of the Company or any of their respective family members, except as disclosed in the Registration
Statement, the Statutory Prospectus and the Prospectus. The Company has not extended or maintained credit, arranged for the extension
of credit, or renewed an extension of credit, in the form of a personal loan to or for any director or officer of the Company.
2.32. No
Influence. The Company has not offered, or caused the Underwriters to offer, the Firm Units to any person or entity with the intention
of unlawfully influencing: (a) a customer or supplier of the Company or any affiliate of the Company to alter the customer’s
or supplier’s level or type of business with the Company or such affiliate or (b) a journalist or publication to write or publish
favorable information about the Company or any such affiliate.
2.33. Sarbanes-Oxley.
The Company is in material compliance with the provisions of the Sarbanes-Oxley Act of 2002, as amended (“SOX”), and
the rules and regulations promulgated thereunder and related or similar rules and regulations promulgated by any governmental
or self-regulatory entity or agency, that are applicable to it as of the date hereof.
2.34. Nasdaq
Eligibility. As of the Effective Date, the Public Securities have been approved for listing on the Nasdaq Global Market (“Nasdaq”),
subject to official notice of issuance and evidence of satisfactory distribution. There is and has been no failure on the part of the
Company or any of the Company's directors or officers, in their capacities as such, to comply with (as and when applicable), and immediately
following the effectiveness of the Registration Statement the Company will be in compliance with, the rules of Nasdaq, as amended.
2.35. Emerging
Growth Company Status. From the date of the Company’s incorporation through the date hereof, the Company has been and is an
“emerging growth company,” as defined in Section 2(a) of the Act (an “Emerging Growth Company”).
2.36. Free-Writing
Prospectus and Testing-the-Waters. The Company has not made any offer relating to the Public Securities that would constitute an issuer
free writing prospectus, as defined in Rule 433 under the Act, or that would otherwise constitute a “free writing prospectus”
as defined in Rule 405. The Company (a) has not engaged in any Testing-the-Waters Communication other than Testing-the-Waters
Communications with the consent of the Representative with entities that are qualified institutional buyers within the meaning of Rule 144A
under the Act or institutions that are accredited investors within the meaning of Rule 501 under the Act and (b) has not authorized
anyone to engage in Testing-the-Waters Communications other than its officers and the Representative and individuals engaged by the Representative.
The Company has not distributed any written Testing-the-Waters Communications other than those listed on Schedule B hereto. As used herein,
“Testing-the-Waters Communication” means any oral or written communication with potential investors undertaken in reliance
on Section 5(d) of the Act.
2.37. Disclosure
Controls and Procedures. The Company maintains effective “disclosure controls and procedures” (as defined under Rule 13a-15(e) under
the Exchange Act to the extent required by such rule).
2.38. Definition
of “Knowledge”. As used in herein, the term “knowledge of the Company” (or similar language) shall
mean the knowledge of the Company’s executive officers and directors, with the assumption that such officers and directors shall
have made reasonable and diligent inquiry of the matters presented.
3. Covenants
of the Company. The Company covenants and agrees as follows:
3.1. Amendments
to Registration Statement. The Company will deliver to the Representative, prior to filing, any amendment or supplement to the Registration
Statement or Prospectus proposed to be filed after the Effective Date and shall not file any such amendment or supplement to which the
Representative shall reasonably object in writing.
3.2. Federal
Securities Laws.
3.2.1. Compliance.
During the time when a prospectus is required to be delivered under the Act, the Company will use all reasonable efforts to comply with
all requirements imposed upon it by the Act, the Regulations and the Exchange Act and by the regulations under the Exchange Act, as from
time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Public Securities in accordance with
the provisions hereof and the Prospectus. If at any time when a Prospectus relating to the Public Securities is required to be delivered
under the Act, any event shall have occurred as a result of which, in the opinion of counsel for the Company or counsel for the Underwriters,
the Statutory Prospectus and the Prospectus, as then amended or supplemented includes an untrue statement of a material fact or omits
to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, or if it is necessary during such period to amend the Registration Statement or amend or supplement
the Statutory Prospectus and Prospectus to comply with the Act, the Company will notify the Representative promptly and prepare and file
with the Commission, subject to Section 3.1 hereof, an appropriate amendment to the Registration Statement or amendment or supplement
to the Statutory Prospectus and Prospectus (at the expense of the Company) so as to correct such statement or omission or effect such
compliance.
3.2.2. Filing
of Final Prospectus. The Company will promptly file the Prospectus (in form and substance satisfactory to the Representative) with
the Commission pursuant to the requirements of Rule 424 of the Regulations.
3.2.3. Exchange
Act Registration. For a period of five years from the Effective Date (except in connection with a going private transaction), or until
such earlier time upon which the Trust Account is to be liquidated if a Business Combination has not been consummated by the Termination
Date: the Company (i) will use its best efforts to maintain the registration of the Common Stock and Warrants under the provisions
of the Exchange Act and (ii) will not deregister the Common Stock or Warrants under the Exchange Act without the prior written consent
of the Representative.
3.2.4. Free
Writing Prospectuses. The Company agrees that it will not make any offer relating to the Public Securities that would constitute an
issuer free writing prospectus, as defined in Rule 433 under the Act.
3.2.5. Sarbanes-Oxley
Compliance. As soon as it is legally required to do so, the Company shall take all actions necessary to obtain and thereafter maintain
material compliance with each applicable provision of SOX and the rules and regulations promulgated thereunder and related or similar
rules and regulations promulgated by any other governmental or self-regulatory entity or agency with jurisdiction over the Company.
3.3. Emerging
Growth Company Status. The Company will promptly notify the Representative if the Company ceases to be an Emerging Growth Company
at any time prior to the earlier of five years after the consummation of the Company’s initial Business Combination, or the liquidation
of the Trust Account if a Business Combination is not consummated by the Termination Date.
3.4. [Reserved].
3.5. Delivery
of Materials to Underwriters. The Company will deliver to each of the several Underwriters, without charge and from time to time during
the period when a prospectus is required to be delivered under the Act or the Exchange Act, such number of copies of each Statutory Prospectus,
the Prospectus and all amendments and supplements to such documents as such Underwriters may reasonably request.
3.6. Effectiveness
and Events Requiring Notice to the Representative. The Company will use its best efforts to cause the Registration Statement to remain
effective and will notify the Representative immediately and confirm the notice in writing: (i) of the effectiveness of the Registration
Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement, or any post-effective amendment thereto or preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any foreign or
state securities commission of any proceedings for the suspension of the qualification of the Public Securities for offering or sale in
any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to
the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments
or request for any additional information from the Commission; and (vi) of the happening of any event during the time when the Registration
Statement is effective, that, in the judgment of the Company or its counsel, makes any statement of a material fact made in the Registration
Statement, the Statutory Prospectus or the Prospectus untrue or that requires the making of any changes in the Registration Statement,
the Statutory Prospectus and Prospectus in order to make the statements therein, (with respect to the Prospectus and the Statutory Prospectus
and in light of the circumstances under which they were made), not misleading. If the Commission or any foreign or state securities commission
shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort to obtain promptly the
lifting of such order.
3.7. Review
of Financial Statements. Until the earlier of (i) five years from the Effective Date and (ii) the date of liquidation of
the Trust Account if a Business Combination is not consummated by the Termination Date, the Company, at its expense, shall cause its regularly
engaged independent certified public accountants to review (but not audit) the Company’s financial statements for each of the first
three fiscal quarters prior to the earlier of (x) the announcement of quarterly financial information and (y) the filing of
the Company’s Form 10-Q quarterly report for the applicable fiscal quarter.
3.8. Affiliated
Transactions.
3.8.1. Business
Combinations. The Company will not consummate a Business Combination with an entity that is affiliated with any Company Affiliate
unless in each case the Company obtains an opinion from an independent investment banking firm or another independent entity that commonly
renders valuation opinions that the Business Combination is fair to the Company from a financial point of view and a majority of the Company’s
disinterested and independent directors (if there are any) approve such transaction.
3.8.2. Compensation.
Except as disclosed in the Registration Statement, the Company shall not pay any Company Affiliate or any of their affiliates any fees
or compensation for services rendered to the Company prior to, or in connection with, either this Offering or the Business Combination.
3.9. Secondary
Market Trading and Standard & Poor’s. If the Company does not maintain the listing of the Public Securities on Nasdaq
or another national securities exchange, the Company will (i) apply to be included in Standard & Poor’s Daily News
and Corporation Records Corporate Descriptions for a period of five years from the consummation of a Business Combination, (ii) take
such commercially reasonable steps as may be necessary to obtain a secondary market trading exemption for the Company’s securities
in the State of California, and (iii) take such other action as may be reasonably requested by the Representative to obtain a secondary
market trading exemption in such other states as may be requested by the Representative; provided that no qualification shall be required
in any jurisdiction where, as a result thereof, the Company would be subject to service of general process or to taxation as a foreign
corporation doing business in such jurisdiction.
3.10. Investor
Relations Firm. Promptly after the execution of a definitive agreement for a Business Combination, the Company shall retain an investor
relations firm with the expertise necessary to assist the Company both before and after the consummation of the Business Combination for
a term to be agreed upon by the Company and the Representative.
3.11. Reports
to the Representative.
3.11.1. Periodic
Reports, etc. For a period of five years from the Effective Date or until such earlier time upon which the Company is required
to be liquidated and dissolved, the Company will furnish to the Representative and its counsel copies of such financial statements and
other periodic and special reports as the Company, from time to time, furnishes generally to holders of any class of its securities, and
promptly furnish to the Representative: (i) a copy of each periodic report the Company shall be required to file with the Commission;
(ii) a copy of every press release and every news item and article with respect to the Company or its affairs which was released
by the Company; (iii) a copy of each Current Report on Form 8-K and any Schedules 13D, 13G, 14D-1 or 13E-4 received or prepared
by the Company; (iv) five copies of each registration statement filed by the Company with the Commission under the Securities Act;
and (v) such additional documents and information with respect to the Company and the affairs of any future subsidiaries of the Company
as the Representative may from time to time reasonably request; provided that the Representative shall sign, if requested by the Company,
a Regulation FD compliant confidentiality agreement which is reasonably acceptable to the Representative and its counsel in connection
with the Representative’s receipt of such information. Documents filed with the Commission pursuant to Electronic Data Gathering,
Analysis and Retrieval System (“EDGAR”) shall be deemed to have been delivered to the Representative pursuant to this
section.
3.11.2. For
a period of five years following the Effective Date or until such earlier time upon which the Company is required to be liquidated, the
Company shall retain a transfer agent and warrant agent acceptable to the Representative. AST&T is acceptable to the Underwriters.
3.12. Payment
of Expenses. The Company hereby agrees to pay on each of the Closing Date and the Option Closing Date, if any, to the extent not paid
at the Closing Date, or such later date as may be agreed to by the Representative in its sole discretion, all fees and expenses incident
to the performance of the obligations of the Company under this Agreement, including, but not limited to: (i) the preparation, printing,
filing and mailing (including the payment of postage with respect to such mailing) of the Registration Statement, the Statutory Prospectus,
and the final Prospectus and mailing of this Agreement and related documents, including the cost of all copies thereof and any amendments
thereof or supplements thereto supplied to the Underwriters in quantities as may be required by the Underwriters; (ii) the printing,
engraving, issuance and delivery of the Public Securities included in the Units, including any transfer or other taxes payable thereon;
(iii) Nasdaq filing fees or, if necessary, the qualification of the Public Securities under state or foreign securities or Blue Sky
laws; (iv) fees and expenses incurred in registering the Offering with FINRA; (v) fees and disbursements of the transfer and
warrant agent; (vi) the preparation and delivery of transaction lucite cubes or similar commemorative items in a style and quantity
as reasonably requested by the Representative; (vii) all costs and expenses of the Company associated with “road show”
marketing and “due diligence” trips for the Company’s management to meet with prospective investors, including without
limitation, all travel, food and lodging expenses associated with such trips incurred by the Company or such management; and (viii) all
other costs and expenses customarily borne by an issuer incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section 3.12 (including the fees of legal counsel for the Underwriters); provided that the Company
shall only be obligated to pay or otherwise reimburse the Underwriters for up to $150,000.00 in the aggregate of such expenses described
herein (provided, however, that such expense cap in no way limits or impairs the indemnification and contribution provisions of the Company’s
engagement letter with the Representative). The Company also agrees that it will pay for an investigative search firm of the Representative’s
choice to conduct an investigation of the principals of the Company as shall be mutually selected by the Representative and the Company.
If the Offering is consummated, the Representative may deduct from the net proceeds of the Offering payable to the Company on the Closing
Date the expenses set forth above (which shall be mutually agreed upon between the Company and the Representative prior to the Closing
Date) to be paid by the Company to the Representative and others. If the Offering is not consummated for any reason (other than a breach
by the Representative of any of its obligations hereunder), then the Company shall reimburse the Representative in full for its out-of-pocket
accountable expenses actually incurred through such date, including, without limitation, reasonable fees and disbursements of counsel
to the Representative, up to a maximum of $50,000 (provided, however, that such expense cap in no way limits or impairs the indemnification
and contribution provisions of the Company’s engagement letter with the Representative).
3.13. Application
of Net Proceeds. The Company will apply the net proceeds from this Offering received by it in a manner substantially consistent with
the application described under the caption “Use of Proceeds” in the Prospectus.
3.14. Delivery
of Earnings Statements to Security Holders. The Company will make generally available to its security holders as soon as practicable,
but not later than the first day of the sixteenth full calendar month following the Effective Date, an earnings statement (which need
not be certified by independent public or independent certified public accountants unless required by the Act or the Regulations, but
which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Act) covering a period of at least twelve
consecutive months beginning after the Effective Date.
3.15. Notice
to FINRA.
3.15.1. Assistance
with Business Combination. For a period of sixty days following the Effective Date, in the event any person or entity (regardless
of any FINRA affiliation or association) is engaged in writing to assist the Company in its search for a Business Combination candidate
or to provide any similar Business Combination-related services, the Company will provide the following information (the “Business
Combination Information”) to the Representative: (i) complete details of all services and copies of agreements governing
such services (which details or agreements may be appropriately redacted to account for privilege or confidentiality concerns); and (ii) justification
as to why the person or entity providing the Business Combination-related services should not be considered an “underwriter and
related person” with respect to the Company’s initial public offering, as such term is defined in Rule 5110 of FINRA’s
Conduct Rules. The Company also agrees that, if required by law, proper disclosure of such arrangement or potential arrangement will be
made in the proxy statement which the Company will file for purposes of soliciting stockholder approval for the Business Combination.
Upon the Company’s delivery of the Business Combination Information to the Representative, the Company hereby expressly authorizes
the Representative to provide such information directly to FINRA as a result of representations the Representative have made to FINRA
in connection with the Offering.
3.15.2. Broker/Dealer.
In the event the Company intends to register as a broker/dealer, merge with or acquire a registered broker/dealer, or otherwise become
a member of FINRA, it shall promptly notify the Representative.
3.16. Stabilization.
Neither the Company, nor, to its knowledge, any of its employees, officers, directors or stockholders (without the consent of the Representative)
has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to
cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Public Securities.
3.17. Internal
Controls. From and after the Closing Date, the Company will maintain a system of internal accounting controls sufficient to provide
reasonable assurances that: (i) transactions are executed in accordance with management’s general or specific authorization;
(ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with GAAP and to
maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
3.18. Accountants.
For a period of five years from the Effective Date or until such earlier time upon which the Trust Account is required to be liquidated,
the Company shall retain Accountant or other independent public accountants reasonably acceptable to the Representative.
3.19. Form 8-K’s.
The Company has retained the Accountant to audit the balance sheet of the Company as of the Closing Date (the “Audited Balance
Sheet”) reflecting the receipt by the Company of the proceeds of the Offering and the Private Placement. Within four (4) Business
Days of the Closing Date, the Company shall file a Current Report on Form 8-K with the Commission, which Report shall contain the
Company’s Audited Balance Sheet. If the Over-Allotment Option has not been exercised on the Effective Date, the Company will also
file an amendment to the Form 8-K, or a new Form 8-K, to provide updated financial information of the Company to reflect the
exercise and consummation of the Over-Allotment Option.
3.20. FINRA.
Until the Option Closing Date, if any, the Company shall advise the Representative if it is aware that any 10% or greater stockholder
of the Company becomes an affiliate or associated person of a FINRA member participating in the distribution of the Public Securities.
3.21. Corporate
Proceedings. All corporate proceedings and other legal matters necessary to carry out the provisions of this Agreement and the transactions
contemplated hereby shall have been done to the reasonable satisfaction to counsel for the Underwriters.
3.22. Investment
Company. The Company shall cause the proceeds of the Offering to be held in the Trust Account to be invested only as set forth in
the Trust Agreement as in effect on the date hereof and disclosed in the Prospectus. The Company will otherwise conduct its business in
a manner so that it will not become subject to the Investment Company Act. Furthermore, once the Company consummates a Business Combination,
it will be engaged in a business other than that of investing, reinvesting, owning, holding or trading securities.
3.23. Press
Releases. The Company agrees that it will not issue press releases or engage in any other publicity, without the Representative’s
prior written consent (not to be unreasonably withheld), for a period of twenty-five (25) days after the Closing Date; provided that in
no event shall the Company be prohibited from issuing any press release or engaging in any other publicity required by law.
3.24. Electronic
Prospectus. The Company shall cause to be prepared and delivered to the Representative, at its expense, promptly, but in no event
later than two (2) Business Days from the effective date of this Agreement, an Electronic Prospectus to be used by the Underwriters
in connection with the Offering. As used herein, the term “Electronic Prospectus” means a form of prospectus, and any
amendment or supplement thereto, that meets each of the following conditions: (i) it shall be encoded in an electronic format, satisfactory
to the Representative, that may be transmitted electronically by the other Underwriters to offerees and purchasers of the shares of Common
Stock for at least the period during which a Prospectus relating to the shares of Common Stock is required to be delivered under the Act;
(ii) it shall disclose the same information as the paper prospectus and prospectus filed pursuant to EDGAR, except to the extent
that graphic and image material cannot be disseminated electronically, in which case such graphic and image material shall be replaced
in the electronic prospectus with a fair and accurate narrative description or tabular representation of such material, as appropriate;
and (iii) it shall be in or convertible into a paper format or an electronic format, satisfactory to the Representative, that will
allow recipients thereof to store and have continuously ready access to the prospectus at any future time, without charge to such recipients
(other than any fee charged for subscription to the Internet as a whole and for on-line time). The Company hereby confirms that it has
included or will include in the Prospectus filed pursuant to EDGAR or otherwise with the Commission and in the Registration Statement
at the time it was declared effective an undertaking that, upon receipt of a request by an investor or his or her representative within
the period when a prospectus relating to the shares of Common Stock is required to be delivered under the Act, the Company shall transmit
or cause to be transmitted promptly, without charge, a paper copy of the Prospectus.
3.25. Future
Financings. The Company agrees that neither it, nor any successor or subsidiary of the Company, will consummate any public or private
equity or debt financing prior to or in connection with the consummation of a Business Combination, unless all investors in such financing
expressly waive, in writing, any rights in or claims against the Trust Account.
3.26. Nasdaq
Maintenance. Until the consummation of a Business Combination, the Company will use commercially reasonable efforts to maintain the
listing by Nasdaq of the Public Securities.
3.27. Private
Placement Proceeds. On the Closing Date, the Company shall cause to be deposited $1,425,000 of proceeds from the Private Placement
into the Trust Account.
3.28. Reservation
of Shares. The Company will reserve and keep available that maximum number of its authorized but unissued securities which are issuable
pursuant to the Warrants and the Private Securities (as well as any other warrants that may be issued and covered by the Warrant Agreement)
outstanding from time to time.
3.29. Testing-the-Waters
Communications. If at any time following the distribution of any Written Testing-the-Waters Communication, there occurred or occurs
an event or development as a result of which such Written Testing-the-Waters Communication included or would include any untrue statement
of a material fact or omitted or would omit to state any material fact necessary to make the statements therein in light of the circumstances
existing at that subsequent time, not misleading, the Company will promptly: (i) notify the Representative so that use of the Written
Testing-the-Waters Communication may cease until it is amended or supplemented; (ii) amend or supplement, at its own expense, such
Written Testing-the-Waters Communication to eliminate or correct such untrue statement or omission; and (iii) supply any amendment
or supplement to the Representative in such quantities as may be reasonably requested.
4. Conditions.
4.1. Conditions
of Underwriters’ Obligations. The obligations of the several Underwriters to purchase and pay for the Public Securities, as
provided herein, shall be subject to the continuing accuracy of the representations and warranties of the Company as of the date hereof
and as of each of the Closing Date and the Option Closing Date, if any, to the accuracy of the statements of officers of the Company made
pursuant to the provisions hereof and to the performance by the Company of its obligations hereunder and to the following conditions:
4.1.1. Regulatory
Matters.
4.1.1.1. Effectiveness
of Registration Statement. The Registration Statement shall have become effective not later than 5:00 p.m., New York time, on the
date of this Agreement or such later date and time as shall be consented to in writing by the Representative, and, at the Closing Date,
no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for the purpose shall
have been instituted or shall be pending or contemplated by the Commission and any request on the part of the Commission for additional
information shall have been complied with.
4.1.1.2. FINRA
Clearance. By the Effective Date, the Representative shall have received clearance from FINRA as to the amount of compensation allowable
or payable to the Underwriters as described in the Registration Statement.
4.1.1.3. No
Commission Stop Order. At the Closing Date, the Commission has not issued any order or threatened to issue any order preventing or
suspending the use of any Preliminary Prospectus, the Prospectus or any part thereof, and has not instituted or, to the Company’s
knowledge, threatened to institute any proceedings with respect to such an order.
4.1.1.4. Nasdaq
Listing. The Public Securities shall have been approved for listing on Nasdaq, subject to official notice of issuance and evidence
of satisfactory distribution.
4.1.2. Company
Counsel Matters.
4.1.2.1. Opinion
of Company Counsel. On each of the Closing Date or the Option Closing Date, if any, the Representative shall have received the favorable
opinions (along with negative assurance letters) of Reed Smith LLP, counsel to the Company, addressed to the Representative as representative
for the several Underwriters and in form mutually agreed to by the Company and the Representative.
4.1.2.2. Reliance.
In rendering such opinions, such counsel may rely: (i) as to matters involving the application of laws other than the laws of the
United States and jurisdictions in which they are admitted, to the extent such counsel deems proper and to the extent specified in such
opinion, if at all, upon an opinion or opinions (in form and substance reasonably satisfactory to the Representative) of other counsel
reasonably acceptable to the Representative, familiar with the applicable laws; and (ii) as to matters of fact, to the extent they
deem proper, on certificates or other written statements of officers of the Company and officers of departments of various jurisdiction
having custody of documents respecting the corporate existence or good standing of the Company, provided that copies of any such statements
or certificates shall be delivered to the Underwriters’ counsel if requested. The opinions of counsels for the Company and any opinion
relied upon by such counsel for the Company shall include a statement to the effect that it may be relied upon by counsel for the Underwriters
in its opinion delivered to the Underwriters.
4.1.3. Cold
Comfort Letter. At the time this Agreement is executed, at the Closing Date and Option Closing Date, if any, the Representative shall
have received a letter, addressed to the Representative as representative for the several Underwriters and in form and substance satisfactory
in all respects (including the non-material nature of the changes or decreases, if any, referred to in clause (iii) below) to the
Representative from Accountant dated, respectively, as of the date of this Agreement and as of the Closing Date and Option Closing Date,
if any:
(i) Confirming
that they are independent accountants with respect to the Company within the meaning of the Act and the applicable Regulations and that
they have not, during the periods covered by the financial statements included in the Registration Statement and the Prospectus, provided
to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act;
(ii) Stating
that in their opinion the financial statements of the Company included in the Registration Statement and the Prospectus comply as to form
in all material respects with the applicable accounting requirements of the Act and the published Regulations thereunder;
(iii) Stating
that, on the basis of a limited review which included a reading of the latest available unaudited interim financial statements of the
Company (with an indication of the date of the latest available unaudited interim financial statements), a reading of the latest available
minutes of the stockholders and board of directors and the various committees of the board of directors, consultations with officers and
other employees of the Company responsible for financial and accounting matters and other specified procedures and inquiries, nothing
has come to their attention which would lead them to believe that: (a) the unaudited financial statements of the Company included
in the Registration Statement and the Prospectus do not comply as to form in all material respects with the applicable accounting requirements
of the Act and the Regulations, or are not fairly presented in conformity with GAAP applied on a basis substantially consistent with that
of the audited financial statements of the Company included in the Registration Statement, the Statutory Prospectus, and the Prospectus;
or (b) at a date immediately prior to the Effective Date or Closing Date, as the case may be, there was any change in the capital
stock or long-term debt of the Company, or any decrease in the stockholders’ equity of the Company as compared with amounts shown
in the [September 30, 2021] balance sheet included in the Registration Statement, other than as set forth in or contemplated by the
Registration Statement, or, if there was any decrease, setting forth the amount of such decrease, and (c) during the period from
[September 30, 2021] to a specified date immediately prior to the Effective Date or Closing Date, as the case may be, there was any
changes in revenues, net earnings (losses), or net earnings (losses) per share, in each case as compared with the Statement of Operations
for the period from April 28, 2021 (Inception) to [September 30, 2021] included in the Registration Statement, or, if there
was any such change, setting forth the amount of such change;
(iv) Stating
that they have compared specific dollar amounts, numbers of shares, percentages of revenues and earnings, statements and other financial
information pertaining to the Company set forth in the Registration Statement in each case to the extent that such amounts, numbers, percentages,
statements and information may be derived from the general accounting records, including work sheets, of the Company and excluding any
questions requiring an interpretation by legal counsel, with the results obtained from the application of specified readings, inquiries
and other appropriate procedures (which procedures do not constitute an examination in accordance with generally accepted auditing standards)
set forth in the letter and found them to be in agreement; and
(v) Statements
as to such other matters incident to the transaction contemplated hereby as the Representative may reasonably request.
4.1.4. Officers’
Certificates.
4.1.4.1. Officers’
Certificate. As of each of the Closing Date and the Option Closing Date, if any, the Representative shall have received a certificate
of the Company signed by the Chairman of the Board or Chief Executive Officer (in their capacities as such), respectively, to the effect
that the Company has performed all covenants and complied with all conditions required by this Agreement to be performed or complied with
by the Company prior to and as of the Closing Date or the Option Closing Date, as applicable, and that the conditions set forth in Section 4.1.5
hereof have been satisfied as of such date and that, as of the Closing Date or the Option Closing Date, as applicable,, the representations
and warranties of the Company set forth in Section 2 hereof are true and correct. In addition, the Representative will have received
such other and further certificates of officers of the Company as the Representative may reasonably request.
4.1.4.2. Secretary’s
Certificate. As of each of the Closing Date and the Option Closing Date, if any, the Representative shall have received a certificate
of the Company signed by the Secretary of the Company, respectively, certifying: (i) that the Certificate of Incorporation and bylaws,
as amended, of the Company are true and complete, have not been modified and are in full force and effect; (ii) that the resolutions
relating to the Offering are in full force and effect and have not been modified; (iii) all correspondence between the Company or
its counsel and the Commission; (iv) all correspondence between the Company or its counsel and Nasdaq; and (v) as to the incumbency
of the officers of the Company. The documents referred to in such certificate shall be attached to such certificate.
4.1.5. No
Material Changes. Prior to each of the Closing Date and the Option Closing Date, if any: (i) there shall have been no material
adverse change or development involving a material adverse change in the condition or prospects or the business activities, financial
or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement, the Statutory
Prospectus and Prospectus; (ii) no action suit or proceeding, at law or in equity, shall have been pending or threatened against
the Company or any Company Affiliate before or by any court or foreign, federal or state commission, board or other administrative agency
wherein an unfavorable decision, ruling or finding may materially adversely affect the business, operations, prospects or financial condition
or income of the Company, except as set forth in the Registration Statement, the Statutory Prospectus and Prospectus; (iii) no stop
order shall have been issued under the Act against the Company and no proceedings therefor shall have been initiated or threatened by
the Commission; and (iv) the Registration Statement, the Statutory Prospectus and the Prospectus and any amendments or supplements
thereto shall contain all material statements which are required to be stated therein in accordance with the Act and the Regulations and
shall conform in all material respects to the requirements of the Act and the Regulations, and none of the Registration Statement, the
Statutory Prospectus or the Prospectus, or any amendment or supplement thereto shall contain any untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary to make the statements therein (in the case of the Statutory
Prospectus and Prospectus, in light of the circumstances under which they were made), not misleading.
4.1.6. Delivery
of Agreements. On the Effective Date, the Company shall have delivered to the Representative executed copies of the Transaction Documents.
4.1.7. Private
Placement Units. On the Closing Date, the Private Placement Units
have been purchased as provided for in the Subscription Agreement and the purchase price for such securities shall be deposited
into the Company’s working capital account.
5. Indemnification.
5.1. Indemnification
of Underwriters and QIU.
5.1.1. General.
Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless each of the Underwriters and each dealer
selected by the Representative that participates in the offer and sale of the Public Securities (each a “Selected Dealer”)
and each of their respective directors, officers, partners and employees and each person, if any, who controls any such Underwriter or
Selected Dealer (“Controlling Person”) within the meaning of Section 15 of the Act or Section 20(a) of
the Exchange Act, and its counsel, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited
to any and all legal or other documented expenses reasonably incurred in investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever, whether arising out of any action between any of the Underwriters and the Company or
between any of the Underwriters and any third party or otherwise) to which they or any of them may become subject under the Act, the Exchange
Act or any other foreign, federal, state or local statute, law, rule, regulation or ordinance or at common law or otherwise or under the
laws, rules and regulation of foreign countries, arising out of or based upon any untrue statement or alleged untrue statement of
a material fact contained in: (i) any Preliminary Prospectus, the Registration Statement, or the Prospectus (as from time to time
each may be amended and supplemented); (ii) in any post-effective amendment or amendments or any new registration statement and prospectus
relating to any of the Public Securities; or (iii) any application or other document or written communication (in this Section 5
collectively called “application”) executed by the Company or based upon written information furnished by the Company
in any jurisdiction in order to qualify the Public Securities under the securities laws thereof or filed with the Commission, any foreign
or state securities commission or agency, Nasdaq (in each case other than statements contained in the section captioned “Selling
Restrictions”); or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were made, not misleading, unless such statement or omission was
made in reliance upon and in conformity with written information furnished to the Company with respect to an Underwriter by or on behalf
of such Underwriter expressly for use in any Preliminary Prospectus, the Registration Statement the Prospectus or any amendment or supplement
thereof, or in any application, as the case may be, which furnished written information, it is expressly agreed, consists solely of the
information described in the proviso contained in the last sentence of Section 2.3.1. With respect to any untrue statement or omission
or alleged untrue statement or omission made in the Preliminary Prospectus, the indemnity agreement contained in this paragraph shall
not inure to the benefit of any Underwriter to the extent that any loss, liability, claim, damage or expense of such Underwriter results
from the fact that a copy of the Prospectus was not given or sent to the person asserting any such loss, liability, claim or damage at
or prior to the written confirmation of sale of the Public Securities to such person as required by the Act and the Regulations, and if
the untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance
by the Company with its obligations under Section 3.4 hereof. The Company agrees promptly to notify the Representative of the commencement
of any litigation or proceedings against the Company or any of its officers, directors or controlling persons in connection with the issue
and sale of the Public Securities or in connection with the Preliminary Prospectus, the Registration Statement, or the Prospectus.
5.1.2. QIU.
Without limitation of and in addition to its obligations under Section 5.1.1, the Company agrees to indemnify and hold harmless the
QIU, its directors, officers, employees and agents and each person who controls the QIU within the meaning of either the Act or the Exchange
Act against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject, insofar
as such losses, claims, damages or liabilities (or action in respect thereof) arise out of or are based upon the QIU acting as a “qualified
independent underwriter” (within the meaning of FINRA Rule 5121) in connection with the offering contemplated by this Agreement,
and agrees to reimburse each such indemnified party, as incurred, for any legal or other documented expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Company will
not be liable in any such case to the extent that any such loss, claim, damage or liability results from the gross negligence or willful
misconduct of the QIU.
5.1.3. Procedure.
If any action is brought against an Underwriter, the QIU or controlling person in respect of which indemnity may be sought against the
Company pursuant to Sections 5.1.1 and 5.1.2, such party shall promptly notify the Company in writing of the institution of such action
and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the reasonable approval
of such Underwriter, QIU or controlling person, as applicable) and payment of actual expenses. Such Underwriter, QIU or controlling person
shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense
of such Underwriter, QIU or such controlling person unless: (i) the employment of such counsel at the expense of the Company shall
have been authorized in writing by the Company in connection with the defense of such action; (ii) the Company shall not have employed
counsel to have charge of the defense of such action; or (iii) counsel to such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them which are different from or additional to those available to the Company
(in which case the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or parties),
in any of which events the reasonable fees and expenses of not more than one additional firm of attorneys selected by the Underwriter,
QIU and/or controlling person shall be borne by the Company. Notwithstanding anything to the contrary contained herein, if the Underwriter,
QIU or controlling person shall assume the defense of such action as provided above, the Company shall have the right to approve the terms
of any settlement of such action which approval shall not be unreasonably withheld.
5.2. Indemnification
of the Company. Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless the Company, its directors, officers,
and employees and agents who control the Company within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
and its counsel, against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company
to the several Underwriters, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions
made in the Registration Statement, any Preliminary Prospectus, the Prospectus or any amendment or supplement thereto, or in any application,
in reliance upon, and in strict conformity with, written information furnished to the Company with respect to such Underwriter by or on
behalf of the Underwriter expressly for use in such Registration Statement, Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto or in any such application, which furnished written information, it is expressly agreed, consists solely of the information
described in clause (ii) of the last sentence of Section 2.3.1. In case any action shall be brought against the Company or any
other person so indemnified based on any Preliminary Prospectus, the Registration Statement, the Prospectus or any amendment or supplement
thereto or any application, and in respect of which indemnity may be sought against any Underwriter, such Underwriter shall have the rights
and duties given to the Company, and the Company and each other person so indemnified shall have the rights and duties given to the several
Underwriters by the provisions of Section 5.1.3.
5.3. Contribution.
5.3.1. Contribution
Rights. In order to provide for just and equitable contribution under the Act in any case in which (i) any person entitled to
indemnification under this Section 5 makes claim for indemnification pursuant hereto but it is judicially determined (by the entry
of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right
of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Section 5 provides for indemnification
in such case, or (ii) contribution under the Act, the Exchange Act or otherwise may be required on the part of any such person in
circumstances for which indemnification is provided under this Section 5 but is unavailable, then, and in each such case, the Company
and the Underwriters shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Company and the Underwriters, as incurred, in such proportions that the Underwriters are responsible
for that portion represented by the percentage that the underwriting discount appearing on the cover page of the Prospectus bears
to the initial offering price appearing thereon and the Company is responsible for the balance; provided, that, no person guilty of a
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. Notwithstanding the provisions of this Section 5.3.1, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total price at which the Public Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has otherwise been required
to pay in respect of such losses, liabilities, claims, damages and expenses. For purposes of this Section, each director, officer and
employee of an Underwriter or the Company, as applicable, and each person, if any, who controls an Underwriter or the Company, as applicable,
within the meaning of Section 15 of the Act shall have the same rights to contribution as the Underwriters or the Company, as applicable.
5.3.2. Contribution
Procedure. Within fifteen days after receipt by any party to this Agreement (or its representatives) of notice of the commencement
of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against another party
(“contributing party”), notify the contributing party of the commencement thereof, but the omission to so notify the
contributing party will not relieve it from any liability which it may have to any other party other than for contribution hereunder.
In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or its representatives
of the commencement thereof within the aforesaid fifteen days, the contributing party will be entitled to participate therein with the
notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any party seeking
contribution on account of any settlement of any claim, action or proceeding effected by such party seeking contribution on account of
any settlement of any claim, action or proceeding effected by such party seeking contribution without the written consent of such contributing
party. The contribution provisions contained in this Section are intended to supersede, to the extent permitted by law, any right
to contribution under the Act, the Exchange Act or otherwise available. The Underwriters’ obligations to contribute pursuant to
this Section 5.3 are several and not joint.
6. Default
by an Underwriter.
6.1. Default
Not Exceeding 10% of Firm Units. If any Underwriter or Underwriters shall default in its or their obligations to purchase the Firm
Units and if the number of the Firm Units with respect to which such default relates does not exceed in the aggregate 10% of the number
of Firm Units that all Underwriters have agreed to purchase hereunder, then such Firm Units to which the default relates shall be purchased
by the non-defaulting Underwriters in proportion to their respective commitments hereunder.
6.2. Default
Exceeding 10% of Firm Units. In the event that the default addressed in Section 6.1 above relates to more than 10% of the Firm
Units, the Representative may, in its discretion, arrange for it or for another party or parties to purchase such Firm Units to which
such default relates on the terms contained herein. If within one (1) Business Day after such default relating to more than 10% of
the Firm Units the Representative does not arrange for the purchase of such Firm Units, then the Company shall be entitled to a further
period of one (1) Business Day within which to procure another party or parties reasonably satisfactory to the Representative to
purchase said Firm Units on such terms. In the event that neither the Representative nor the Company arrange for the purchase of the Firm
Units to which a default relates as provided in this Section 6, this Agreement may be terminated by the Representative or the Company
without liability on the part of the Company (except as provided in Sections 3.12 and 5 hereof) or the several Underwriters (except as
provided in Section 5 hereof); provided that nothing herein shall relieve a defaulting Underwriter of its liability, if any,
to the other several Underwriters and to the Company for damages occasioned by its default hereunder.
6.3. Postponement
of Closing Date. In the event that the Firm Units to which the default relates are to be purchased by the non-defaulting Underwriters,
or are to be purchased by another party or parties as aforesaid, the Representative or the Company shall have the right to postpone the
Closing Date for a reasonable period, but not in any event exceeding five (5) Business Days, in order to effect whatever changes
may thereby be made necessary in the Registration Statement and/or the Prospectus, as the case may be, or in any other documents and arrangements,
and the Company agrees to file promptly any amendment to, or to supplement, the Registration Statement and/or the Prospectus, as the case
may be, that in the reasonable opinion of counsel for the Underwriters may thereby be made necessary. The term “Underwriter”
as used in this Agreement shall include any party substituted under this Section 6 with like effect as if it had originally been
a party to this Agreement with respect to such securities.
7. Additional
Covenants.
7.1. Additional
Shares or Options. Except as described in the Registration Statement, the Company hereby agrees that until the Company consummates
a Business Combination, it shall not issue any shares of Common Stock or any options or other securities convertible into shares of Common
Stock or any preferred shares which participate in any manner in the Trust Account or which vote on a Business Combination.
7.2. Trust
Account Waiver Acknowledgments. The Company hereby agrees that, prior to commencing its due diligence investigation of any Target
Business or obtaining the services of any vendor, it will use reasonable best efforts to have such Target Business or vendor acknowledge
in writing, whether through a letter of intent, memorandum of understanding, agreement in principle or other similar document (and subsequently
acknowledges the same in any definitive document replacing any of the foregoing), that (a) it has read the Prospectus, and understands
that the Company has established the Trust Account, initially in an amount of $150,000,000 for the benefit of the Public Stockholders
and that, except for the interest earned on the amounts held in the Trust Account, the Company may disburse monies from the Trust Account
only: (i) to the Public Stockholders in the event of the conversion of their shares upon consummation of a Business Combination or
amendment to the Company’s Charter relating to pre-Business Combination activity; (ii) to the Public Stockholders in connection
with the Company’s liquidation in the event the Company is unable to consummate a Business Combination within the required time
period; or (iii) to the Company and others concurrently with, or after it consummates a Business Combination, and (b) for and
in consideration of the Company (1) agreeing to evaluate such Target Business for purposes of consummating a Business Combination
with it or (2) agreeing to engage the services of the vendor, as the case may be, such Target Business or vendor agrees that it does
not have any right, title, interest or claim of any kind in or to any monies of the Trust Account (“Claim”) and waives
any Claim it may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with the Company and
will not seek recourse against the Trust Account for any reason whatsoever. The foregoing letters shall substantially be in the form attached
hereto as Exhibits A and B, respectively. The Company may forgo obtaining such waivers only if the Company
shall have received the approval of its Chief Executive Officer and the approving vote of at least a majority of its Board of Directors.
7.3. Letter
Agreements. The Company shall not take any action or omit to take any action which would cause a breach of any of the Letter Agreements
executed between each Company Affiliate and the Representative and will not allow any amendments to, or waivers of, such Letter Agreemetns
without the prior written consent of the Representative, which consent shall not be unreasonably withheld.
7.4. Tender
Offer, Proxy and Other Information. The Company shall provide the Representative with copies of all proxy or tender offer documentation
and other information and all related material sent to Public Stockholders in connection with a Business Combination.
7.5. Rule 419.
The Company agrees that it will use its best efforts to prevent the Company from becoming subject to Rule 419 under the Act prior
to the consummation of any Business Combination, including, but not limited to, using its best efforts to prevent any of the Company’s
outstanding securities from being deemed to be a “penny stock” as defined in Rule 3a-51-1 under the Exchange Act during
such period.
7.6. Presentation
of Potential Target Businesses. The Company shall use reasonable best efforts to cause each of the Respondents to agree that, in order
to minimize potential conflicts of interest which may arise from multiple affiliations, the Respondents will present to the Company for
its consideration, prior to presentation to any other person or company, any suitable opportunity to acquire an operating business, until
the earlier of the consummation by the Company of a Business Combination or the liquidation of the Trust Account, subject to any pre-existing
fiduciary obligations the Respondents might have.
7.7. Target
Fair Market Value. The Company agrees that the Target Business that it acquires must have a fair market value equal to at least 80%
of the balance in the Trust Account (excluding any taxes) at the time of signing the definitive agreement for the Business Combination
with such Target Business. The fair market value of such business must be determined by the Board of Directors of the Company based upon
standards generally accepted by the financial community, such as actual and potential sales, earnings, cash flow and book value. If the
Board of Directors of the Company is not able to independently determine that the target business meets such fair market value requirement,
the Company will obtain an opinion from an unaffiliated, independent investment banking firm, or another independent entity that commonly
renders valuation opinions. The Company is not required to obtain such an opinion as to the fair market value if the Company’s Board
of Directors independently determines that the Target Business does have sufficient fair market value.
8. Representations
and Agreements to Survive Delivery. Except as the context otherwise requires, all representations, warranties and agreements contained
in this Agreement shall be deemed to be representations, warranties and agreements at the Closing Date or Option Closing Date, as applicable,
and such representations, warranties and agreements of the Underwriters and Company, including the indemnity agreements contained in Section 5
hereof, shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any Underwriter, the
Company or any controlling person, and shall survive termination of this Agreement or the issuance and delivery of the Public Securities
to the several Underwriters until the earlier of the expiration of any applicable statute of limitations and the seventh (7th) anniversary
of the Closing Date, at which time the representations, warranties and agreements shall terminate and be of no further force and effect.
9. Qualified
Independent Underwriter. The QIU represents that it is qualified to act as a “qualified independent underwriter” within
the meaning of Rule 5121 of the Conduct Rules of FINRA. The Company hereby confirms that, at its request, the QIU has acted
as a “qualified independent underwriter” within the meaning of Rule 5121 of the Conduct Rules of FINRA in connection
with the offering of the Public Securities.
10. Effective
Date of This Agreement and Termination Thereof.
10.1. Effective
Date. This Agreement shall become effective on the Effective Date at the time the Registration Statement is declared effective by
the Commission.
10.2. Termination.
The Representative shall have the right to terminate this Agreement at any time prior to any Closing Date: (i) if any domestic or
international event or act or occurrence has materially disrupted or, in the Representative’s sole opinion, will in the immediate
future materially disrupt, general securities markets in the United States; or (ii) if trading on the New York Stock Exchange, the
NYSE American, Nasdaq or on the OTC Bulletin Board (or successor trading market) shall have been suspended, or minimum or maximum prices
for trading shall have been fixed, or maximum ranges for prices for securities shall have been fixed, or maximum ranges for prices for
securities shall have been required on the OTC Bulletin Board or by order of the Commission or any other government authority having jurisdiction,
or (iii) if the United States shall have become involved in a war or an increase in existing major hostilities, or (iv) if a
banking moratorium has been declared by a New York State or federal authority, or (v) if a moratorium on foreign exchange trading
has been declared which materially adversely impacts the United States securities market, or (vi) if the Company shall have sustained
a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or
not such loss shall have been insured, will, in the Representative’s sole opinion, make it inadvisable to proceed with the delivery
of the Firm Units, (vii) if any of the Company’s representations, warranties or covenants hereunder are breached, or (viii) if
the Representative shall have become aware after the date hereof of a Material Adverse Effect on the Company, or such adverse material
change in general market conditions, including, without limitation, as a result of terrorist activities or any other calamity or crisis
either within or outside the United States after the date hereof, or any increase in any of the foregoing, as in the Representative’s
sole judgment would make it impracticable to proceed with the offering, sale and/or delivery of the Firm Units or to enforce contracts
made by the Underwriters for the sale of the Firm Units.
10.3. Expenses.
If this Agreement shall be terminated pursuant to Section 6 hereof, the Company shall not be under any liability to any Underwriter
or the Representative; but, if for any other reason this Agreement shall not be carried out, within the time specified herein or any extensions
thereof pursuant to the terms herein, the obligations of the Company to pay the out of pocket expenses related to the transactions contemplated
herein shall be governed by Section 3.12 hereof.
10.4. Indemnification.
Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and
whether or not this Agreement is otherwise carried out, the provisions of Section 5 shall not be in any way effected by, such election
or termination or failure to carry out the terms of this Agreement or any part hereof.
11. Miscellaneous.
11.1. Notices.
All communications hereunder, except as herein otherwise specifically provided, shall be in writing and shall be mailed by certified mail
(with return receipt), delivered by e-mail transmission, hand or reputable overnight courier, delivered by facsimile transmission (with
printed confirmation of receipt) and confirmed, or by electronic transmission via PDF and shall be deemed given when so mailed, delivered
by e-mail, or faxed or transmitted (or if mailed, five days after such mailing):
If to the Representative:
A.G.P./Alliance Global Partners
590 Madison Avenue, 28th Floor
New York, NY 10022
Fax No.: [______]
Attn: [______]
Email: [______]
With a copy (which shall not constitute
notice) to:
Sullivan & Worcester LLP
1633 Broadway, 32nd Floor
New York, NY 10019
Attn: Oded Har Even, Esq.
Email: ohareven@sullivanlaw.com
If to the Company, to:
Western Acquisition Ventures Corp.
42 Broadway, 12th Floor
New York, New York 10004
Attn: Stephen Christoffersen
Email: schristoffersen@westacqventures.com
With a copy (which shall not constitute notice) to:
Reed Smith LLP
599 Lexington Avenue
New York, New York 10022
Attn: Marc Hauser, Esq., Ari Edelman, Esq.
Email: mhauser@reedsmith.com. aedelman@reedsmith.com
11.2. Headings.
The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the meaning
or interpretation of any of the terms or provisions of this Agreement.
11.3. Amendment.
This Agreement may only be amended by a written instrument executed by each of the parties hereto.
11.4. Entire
Agreement. This Agreement (together with the other agreements and documents being delivered pursuant to or in connection with this
Agreement) constitute the entire agreement of the parties hereto with respect to the subject matter hereof and thereof, and supersede
all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof.
11.5. Binding
Effect. This Agreement shall inure solely to the benefit of and shall be binding upon the Representative, the Underwriters, the Company
and the controlling persons, directors and officers referred to in Section 5 hereof, and their respective successors, legal representatives
and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under or in respect
of or by virtue of this Agreement or any provisions herein contained.
11.6. Governing
Law, Venue, etc. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New
York, without giving effect to the conflict of laws principles thereof. Each of the Company and the Representative hereby agrees that
any action, proceeding, or claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the
courts of the State of New York, New York County under the accelerated adjudication procedures of the Commercial Division, or in the United
States District Court for the Southern District of New York, as applicable, and irrevocably submits to such jurisdiction, which jurisdiction
shall be exclusive. Each of the Company and the Representative hereby waives any objection to such exclusive jurisdiction and that such
courts represent an inconvenient forum. Any such process or summons to be served upon the Company or the Representative, respectively,
may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to
it at the address set forth in Section 10.1 hereof. Such mailing shall be deemed personal service and shall be legal and binding
upon the Company or the Representative, respectively, in any action, proceeding, or claim. Each of the Company and the Representative
agrees that the prevailing party(ies) in any such action shall be entitled to recover from the other party(ies) all of its reasonable
attorneys’ fees and expenses relating to such action or proceeding and/or incurred in connection with the preparation therefor.
11.7. Execution
in Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts,
each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement, and shall
become effective when one or more counterparts has been signed by each of the parties hereto and delivered to each of the other parties
hereto. Delivery of a signed counterpart of this Agreement by fax or email/.pdf transmission shall constitute valid and sufficient delivery
thereof.
11.8. Waiver, etc.
The failure of any of the parties hereto to at any time enforce any of the provisions of this Agreement shall not be deemed or construed
to be a waiver of any such provision, nor to in any way affect the validity of this Agreement or any provision hereof or the right of
any of the parties hereto to thereafter enforce each and every provision of this Agreement. No waiver of any breach, non-compliance or
non-fulfillment of any of the provisions of this Agreement shall be effective unless set forth in a written instrument executed by the
party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach, non-compliance or non-fulfillment
shall be construed or deemed to be a waiver of any other or subsequent breach, non-compliance or non-fulfillment.
11.9. No
Fiduciary Relationship. The Company hereby acknowledges that the Underwriters and QIU are acting solely as underwriters in connection
with the offering of the Public Securities. The Company further acknowledges that the Underwriters and QIU are acting pursuant to a contractual
relationship created solely by this Agreement entered into on an arm's length basis and in no event do the parties intend that the Underwriters
act or be responsible as a fiduciary to the Company, its management, stockholders, creditors or any other person in connection with any
activity that the Underwriters and QIU may undertake or have undertaken in furtherance of the offering of the Public Securities, either
before or after the date hereof. The Underwriters and QIU hereby expressly disclaim any fiduciary or similar obligations to the Company,
either in connection with the transactions contemplated by this Agreement or any matters leading up to such transactions, and the Company
hereby confirms its understanding and agreement to that effect. The Company, the Underwriters and QIU agree that they are each responsible
for making their own independent judgments with respect to any such transactions, and that any opinions or views expressed by the Underwriters
or QIU to the Company regarding such transactions, including but not limited to any opinions or views with respect to the price or market
for the Public Securities, do not constitute advice or recommendations to the Company. The Company hereby waives and releases, to the
fullest extent permitted by law, any claims that the Company may have against the Underwriters and QIU with respect to any breach or alleged
breach of any fiduciary or similar duty to the Company in connection with the transactions contemplated by this Agreement or any matters
leading up to such transactions.
[Signature Page Follows]
If the foregoing correctly
sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between us.
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Very Truly Yours,
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Western Acquisition Ventures Corp.
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By:
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Name: Stephen Christoffersen
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Title: Chief Executive Officer
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Agreed to and accepted
as of the date first written above:
A.G.P./ALLIANCE GLOBAL PARTNERS,
as Representative of the several Underwriters
The Benchmark Company, LLC,
as Qualified Independent Underwriter
[Signature
Page to Underwriting Agreement, dated ___________, 2021]
SCHEDULE A
Western Acquisition Ventures Corp.
10,000,000 Units
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Underwriter
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Number of
Firm Units
to be
Purchased
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A.G.P./Alliance Global Partners
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The Benchmark Company, LLC
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Brookline Capital Markets
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TOTAL
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10,000,000
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SCHEDULE B
EXHIBIT A
Form of Target Business Letter
Western Acquisition Ventures Sponsor LLC
42 Broadway, 12th Floor
New York, New York 10004
Ladies and Gentlemen:
Reference is made to the Final
Prospectus of Western Acquisition Ventures Corp. (the “Company”), dated ___________, 2021 (the “Prospectus”).
Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Prospectus.
We have read the Prospectus
and understand that the Company has established the Trust Account, initially in an amount of at least $100,000,000, for the benefit of
the Public Stockholders and that, except for the interest earned on the amounts held in the Trust Account, the Company may disburse monies
from the Trust Account only: (i) to the Public Stockholders in the event of the conversion of their shares upon consummation of a
Business Combination or amendment to the Company’s Amended and Restated Certificate of Incorporation relating to pre-Business Combination
activity, (ii) to the Public Stockholders in connection with the Company’s liquidation in the event the Company is unable to
consummate a Business Combination within the required time period or (iii) to the Company concurrently with, or after it consummates
a Business Combination.
For and in consideration of
the Company agreeing to evaluate the undersigned for purposes of consummating a Business Combination with it, the undersigned hereby agrees
that it does not have any right, title, interest or claim of any kind in or to any monies in the Trust Account (each, a “Claim”)
and hereby waives any Claim it may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with
the Company and will not seek recourse against the Trust Account for any reason whatsoever.
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Print Name of Target Business
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Authorized Signature of Target Business
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EXHIBIT B
Form of Vendor Letter
Western Acquisition Ventures Sponsor LLC
42 Broadway, 12th Floor
New York, New York 10004
Ladies and Gentlemen:
Reference is made to the Final
Prospectus of Western Acquisition Ventures Corp. (the “Company”), dated ___________, 2021 (the “Prospectus”).
Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Prospectus.
We have read the Prospectus
and understand that the Company has established the Trust Account, initially in an amount of at least $100,000,000, for the benefit of
the Public Stockholders and that, except for the interest earned on the amounts held in the Trust Account, the Company may disburse monies
from the Trust Account only: (i) to the Public Stockholders in the event of the conversion of their shares upon consummation of a
Business Combination or amendment to the Company’s Amended and Restated Certificate of Incorporation relating to pre-Business Combination
activity; (ii) to the Public Stockholders in connection with the Company’s liquidation in the event the Company is unable to
consummate a Business Combination within the required time period; or (iii) to the Company concurrently with, or after it consummates
a Business Combination.
For and in consideration of
the Company agreeing to use the services of the undersigned, the undersigned hereby agrees that it does not have any right, title, interest
or claim of any kind in or to any monies in the Trust Account (each, a “Claim”) and hereby waives any Claim it may
have in the future as a result of, or arising out of, any services provided to the Company and will not seek recourse against the Trust
Account for any reason whatsoever.
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Print Name of Vendor
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Authorized Signature of Vendor
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Exhibit
4.4
WARRANT AGREEMENT
This
Warrant Agreement (“Agreement”) is made as of [●], 2021 between Western Acquisition Ventures Corp., a
Delaware corporation, with offices at 42 Broadway, 12th Floor, New York, New York 10004 (the “Company”), and American
Stock Transfer & Trust Company, a limited purpose trust company, with offices at [●], as warrant agent (the “Warrant
Agent”, also referred to herein as the “Transfer Agent”).
WHEREAS,
the Company is engaged in an initial public offering (the “Offering”) of up to 17,250,000 units (including up
to 2,250,000 units subject to the Over-allotment Option (as defined below)) (the “Public Units”) of the Company’s
equity securities, each such unit comprised of one share of common stock of the Company, par value $0.0001 per share (“Common
Stock”), and one Public Warrant (as defined below) and, in connection therewith, has determined to issue and deliver up
to 17,250,000 Warrants (including up to 2,250,000 warrants that may be issuable upon the exercise of a forty-five (45) day over-allotment
option granted to the underwriters (the “Over-allotment Option”)) to investors in the Offering (the “Public
Warrants” and, collectively with the Private Warrants (as defined below), the Working Capital Warrants (as defined below)
and the Post-IPO Warrants (as defined below), the “Warrants”), each whole Warrant evidencing the right of the
holder thereof to purchase three-quarters of one share of common stock of the Company, $0.0001 par value per share (the “Common
Stock”), for $11.50 per whole share, subject to adjustment as described herein;
WHEREAS,
the Company has filed with the Securities and Exchange Commission (the “SEC”) a Registration Statement on Form S-1,
File No. [●] (“Registration Statement”), and a prospectus (the “Prospectus”)
for the registration, under the Securities Act of 1933, as amended (“Act”), of the Public Units and the Public Warrants
and the Common Stock included in the Public Units; and
WHEREAS,
the Company has received a binding commitment from Western Acquisition Ventures Sponsor, LLC (the “Sponsor”)
to purchase 261,000 units (“Private Units”) which will include up to an aggregate of 261,000 warrants (the “Private
Warrants”) bearing the legend set forth in Exhibit B hereto, in a private placement transaction to occur simultaneously
with the consummation of the Offering; and
WHEREAS,
the Company may issue up to an additional [●] units (the “Working Capital Units” and together with the
Public Units and the Private Units, the “Units”) which will include up to an additional [●] warrants (the “Working
Capital Warrants”) in satisfaction of certain working capital loans the Sponsor or the Company’s officers, directors,
other initial stockholders (as defined in the Prospectus) or their affiliates may, but are not obligated to, make to the Company; and
WHEREAS,
following consummation of the Offering, the Company may issue additional warrants (the “Post IPO Warrants” and together
with the Public Warrants, Private Warrants, and Working Capital Warrants, the “Warrants”) in connection with,
or following the consummation by the Company of, a Business Combination (defined below); and
WHEREAS,
the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with
the issuance, registration, transfer, exchange, redemption, and exercise of the Warrants; and
WHEREAS,
the Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and
the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants; and
WHEREAS,
all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company and
countersigned by or on behalf of the Warrant Agent, as provided herein, the valid, binding, and legal obligations of the Company, and
to authorize the execution and delivery of this Agreement.
NOW,
THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:
1. Appointment
of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for the Warrants, and the Warrant
Agent hereby accepts such appointment and agrees to perform the same in accordance with the terms and conditions set forth in this Agreement.
2. Warrants.
2.1 Form of
Warrant. Each Warrant shall (i) be issued in registered form only; (ii) be in substantially
the form of Exhibit A hereto, the provisions of which are incorporated herein; (iii) be signed by, or bear the facsimile signature
of, the Chairperson of the Board of Directors or Chief Executive Officer, and the Chief Financial Officer, Treasurer, Secretary, or Assistant
Secretary of the Company; and (iv) bear a facsimile of the Company’s seal. In the event the person whose facsimile signature
has been placed upon any Warrant shall have ceased to serve in the capacity in which such person signed the Warrant before such Warrant
is issued, it may be issued with the same effect as if they had not ceased to be such at the date of issuance.
2.2 Uncertificated
Warrants. Notwithstanding anything herein to the contrary, any Warrant, or portion thereof, may be issued as part of, and be represented
by, a Unit, and any Warrant may be issued in uncertificated or book-entry form through the Warrant Agent and/or the facilities of The
Depository Trust Company or other book-entry depositary system, in each case as determined by the Board of Directors of the Company or
by an authorized committee thereof. Any Warrant so issued shall have the same terms, force and effect as a certificated Warrant that has
been duly countersigned by the Warrant Agent in accordance with the terms of this Agreement.
2.3. Effect
of Countersignature. Except with respect to uncertificated Warrants as described above, unless and until countersigned by the Warrant
Agent pursuant to this Agreement, a Warrant shall be invalid and of no effect and may not be exercised by the holder thereof.
2.4. Registration.
2.4.1. Warrant
Register. The Warrant Agent shall maintain books (“Warrant Register”) for the registration of original issuance
and the registration of transfer of the Warrants. Upon the initial issuance of the Warrants, the Warrant Agent shall issue and register
the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance with instructions delivered
to the Warrant Agent by the Company.
2.4.2. Registered
Holder. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat
the person in whose name such Warrant is then registered in the Warrant Register (“registered holder”) as the absolute
owner of such Warrant and of each Warrant represented thereby (notwithstanding any notation of ownership or other writing on the Warrant
certificate made by anyone other than the Company or the Warrant Agent), for the purpose of any exercise thereof, and for all other purposes,
and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.
2.5. Detachability
of Warrants. The securities comprising the Public Units will not be separately transferable until the 90th day following the date
of the Prospectus or, if such 90th day is not on a day, other than Saturday, Sunday or federal holiday, on which banks in New York City
are generally open for normal business (a “Business Day”), then on the immediately succeeding Business Day following
such date, or earlier with the consent of the Sponsor, but in no event will the Sponsor allow separate trading of the securities comprising
the Public Units until (i) the Company has filed a Current Report on Form 8-K which includes an audited balance sheet reflecting
the receipt by the Company of the gross proceeds of the Offering including the proceeds received by the Company from the exercise of the
Over-allotment Option, if the Over-allotment Option is exercised prior to the filing of the Form 8-K; and (ii) the Company has
issued a press release announcing when such separate trading shall begin (the “Detachment Date”); provided, however,
that, (x) if the Over-allotment Option is exercised after the filing of the initial Current Report on Form 8-K, a second
or amended Current Report on Form 8-K shall be filed by the Company to provide updated financial information to reflect the exercise
of the Over-allotment Option; and (y) no fractional Warrants will be issued upon separation of the Units and only whole Warrants
will trade.
2.6. Private
Warrant and Working Capital Warrant Attributes. The Private Warrants and Working Capital Warrants will be issued in the same form
as the Public Warrants.
2.7. Post
IPO Warrants. The Post IPO Warrants, when and if issued, shall have the same terms and be in the same form as the Public Warrants
except as may be agreed upon by the Company.
3. Terms
and Exercise of Warrants
3.1. Warrant
Price. Each whole Warrant shall, when countersigned by the Warrant Agent (except with respect to uncertificated Warrants), entitle
the registered holder thereof, subject to the provisions of such Warrant and of this Agreement, to purchase from the Company the number
of shares of Common Stock stated therein, at the price of $11.50 per whole share, subject to the adjustments provided in Section 4
hereof and in the last sentence of this Section 3.1. The term “Warrant Price” as used in this Agreement refers
to the price per share at which the shares of Common Stock may be purchased at the time a Warrant is exercised. The Company in its sole
discretion may lower the Warrant Price at any time prior to the Expiration Date (as defined below) for a period of not less than twenty
(20) Business Days; provided, that the Company shall provide at least twenty (20) days’ prior written notice of such reduction to
registered holders of the Warrants and, provided further that any such reduction shall be applied consistently to all of the Warrants.
3.2. Duration
of Warrants. A Warrant may be exercised only during the period commencing on the later of 30 days after the consummation by the Company
of a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination
with one or more businesses or entities (“Business Combination”) (as described more fully in the Registration Statement)
or 12 months from the closing of the Offering, and terminating at 5:00 p.m., New York City time on the earlier to occur of (i) five
years from the consummation of a Business Combination; (ii) the Redemption Date as provided in Section 6.2 of this Agreement;
and (iii) the liquidation of the Company (“Expiration Date”). The period of time from the date the Warrants will
first become exercisable until the expiration of the Warrants shall hereafter be referred to as the “Exercise Period.”
Except with respect to the right to receive the Redemption Price (as set forth in Section 6 hereunder), as applicable, each Warrant
not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect thereof under this
Agreement shall cease at 5:00 p.m., New York City time, on the Expiration Date. The Company in its sole discretion may extend the duration
of the Warrants by delaying the Expiration Date; provided, however, that the Company will provide at least twenty (20) days’
prior written notice of any such extension to registered holders and, provided further that any such extension shall be applied consistently
to all of the Warrants.
3.3. Exercise
of Warrants.
3.3.1. Payment.
Subject to the provisions of the Warrant and this Agreement, a Warrant, when countersigned by the Warrant Agent, may be exercised by the
registered holder thereof by surrendering it, at the office of the Warrant Agent, or at the office of its successor as Warrant Agent,
in the Borough of Manhattan, City and State of New York, with the subscription form, as set forth in the Warrant, duly executed, and by
paying in full the Warrant Price for each full share of Common Stock as to which the Warrant is exercised and any and all applicable taxes
due in connection with the exercise of the Warrant, the exchange of the Warrant for the shares of Common Stock and the issuance of such
shares of Common Stock, as follows:
(a) in
lawful money of the United States, by good certified check or wire payable to the Warrant Agent; or
(b) in
the event of redemption pursuant to Section 6 hereof in which the Company’s management has elected to force all holders of
Warrants to exercise such Warrants on a “cashless basis,” by surrendering the Warrants for that number of shares of Common
Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants,
multiplied by the difference between the Warrant Price and the “Fair Market Value” (defined below) by (y) the Fair Market
Value. Solely for purposes of this Section 3.3.1(b), the “Fair Market Value” shall mean the average reported last sale
price of the Common Stock for the five (5) trading days ending on the third trading day prior to the date on which the notice of
redemption is sent to holders of the Warrants pursuant to Section 6 hereof; or
(c) in
the event the registration statement required by Section 7.4 hereof is not effective and current within sixty (60) Business Days
after the closing of a Business Combination, by surrendering such Warrants for that number of shares of Common Stock equal to the quotient
obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants, multiplied by the difference
between the exercise price of the Warrants and the “Fair Market Value” by (y) the Fair Market Value; provided, however,
that no cashless exercise shall be permitted unless the Fair Market Value is equal to or higher than the exercise price. Solely for purposes
of this Section 3.3.1(d), the “Fair Market Value” shall mean the average reported last sale price of the Common Stock
for the five (5) trading days ending on the trading day prior to the date of exercise.
3.3.2. Issuance
of Shares of Common Stock. As soon as practicable after the exercise of any Warrant and the clearance of the funds in payment of the
Warrant Price (if any), the Company shall issue to the registered holder of such Warrant a certificate or certificates, or book entry
position, for the number of shares of Common Stock to which they are entitled, registered in such name or names as may be directed by
them, and if such Warrant shall not have been exercised in full, a new countersigned Warrant, or book entry position, for the number of
shares as to which such Warrant shall not have been exercised. Notwithstanding the foregoing, in no event will the Company be required
to net cash settle the Warrant exercise. No Warrant shall be exercisable for cash and the Company shall not be obligated to issue shares
of Common Stock upon exercise of a Warrant unless the Common Stock issuable upon such Warrant exercise has been registered, qualified,
or deemed to be exempt under the securities laws of the state of residence of the registered holder of the Warrants. In the event that
the condition in the immediately preceding sentence is not satisfied with respect to a Warrant, the holder of such Warrant shall not be
entitled to exercise such Warrant for cash and such Warrant may have no value and expire worthless, in which case the purchaser of a Unit
containing such Public Warrants shall have paid the full purchase price for the Unit solely for the shares of Common Stock underlying
such Unit. Warrants may not be exercised by, or securities issued to, any registered holder in any state in which such exercise would
be unlawful.
3.3.3. Valid
Issuance. All shares of Common Stock issued upon the proper exercise of a Warrant in conformity with this Agreement shall be validly
issued, fully paid and nonassessable.
3.3.4. Date
of Issuance. Each person in whose name any book entry position or certificate for shares of Common Stock is issued shall for all purposes
be deemed to have become the holder of record of such shares on the date on which the Warrant, or book entry position representing such
Warrant, was surrendered and payment of the Warrant Price was made, irrespective of the date of delivery of such certificate, except that,
if the date of such surrender and payment is a date when the share transfer books of the Company or book entry system of the Warrant Agent
are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date
on which the share transfer books or book entry system are open.
3.3.5 Maximum
Percentage. A holder of a Warrant may notify the Company in writing in the event it elects to be subject to the provisions contained
in this subsection 3.3.5; however, no holder of a Warrant shall be subject to this subsection 3.3.5 unless he, she or it makes such election.
If the election is made by a holder, the Warrant Agent shall not effect the exercise of the holder’s Warrant, and such holder shall
not have the right to exercise such Warrant, to the extent that after giving effect to such exercise, such person (together with such
person’s affiliates), to the Warrant Agent’s actual knowledge, would beneficially own in excess of 9.8% (the “Maximum
Percentage”) of the shares of Common Stock outstanding immediately after giving effect to such exercise. For purposes of the
foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such person and its affiliates shall include
the number of shares of Common Stock issuable upon exercise of the Warrant with respect to which the determination of such sentence is
being made, but shall exclude shares of Common Stock that would be issuable upon (x) exercise of the remaining, unexercised portion
of the Warrant beneficially owned by such person and its affiliates and (y) exercise or conversion of the unexercised or unconverted
portion of any other securities of the Company beneficially owned by such person and its affiliates (including, without limitation, any
convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation
contained herein. Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated
in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
For purposes of the Warrant, in determining the number of outstanding shares of Common Stock, the holder may rely on the number of outstanding
shares of Common Stock as reflected in (1) the Company’s most recent annual report on Form 10-K, quarterly report on
Form 10-Q, current report on Form 8-K or other public filing with the SEC as the case may be, (2) a more recent public
announcement by the Company or (3) any other notice by the Company or the Transfer Agent setting forth the number of shares of Common
Stock outstanding. For any reason at any time, upon the written request of the holder of the Warrant, the Company shall, within two (2) Business
Days, confirm orally and in writing to such holder the number of shares of Common Stock then outstanding. In any case, the number of
outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of equity securities of the
Company by the holder and its affiliates since the date as of which such number of outstanding shares of Common Stock was reported. By
written notice to the Company, the holder of a Warrant may from time to time increase or decrease the Maximum Percentage applicable to
such holder to any other percentage specified in such notice; provided, however, that any such increase shall not be effective until
the sixty-first (61st) day after such notice is delivered to the Company.
4. Adjustments.
4.1. Stock
Dividends; Split Ups. If after the date hereof, and subject to the provisions of Section 4.6 below, the number of outstanding
shares of Common Stock is increased by a stock dividend payable in shares of Common Stock, or by a split up of shares of Common Stock,
or other similar event, then, on the effective date of such stock dividend, split up or similar event, the number of shares of Common
Stock issuable on exercise of each Warrant shall be increased in proportion to such increase in outstanding shares of Common Stock.
4.2. Aggregation
of Shares. If after the date hereof, the number of outstanding shares of Common Stock is decreased by a consolidation, combination,
reverse stock split, or reclassification of shares of Common Stock or other similar event, then, on the effective date of such consolidation,
combination, reverse stock split, reclassification or similar event, the number of shares of Common Stock issuable on exercise of each
Warrant shall be decreased in proportion to such decrease in outstanding shares of Common Stock.
4.3. Extraordinary
Dividends. If the Company, at any time while the Warrants are outstanding and unexpired, shall pay a dividend or make a distribution
in cash, securities or other assets to the holders of the shares of Common Stock or other shares of the Company’s capital stock
into which the Warrants are convertible (an “Extraordinary Dividend”), then the Warrant Price shall be decreased,
effective immediately after the effective date of such Extraordinary Dividend, by the amount of cash and the fair market value (as determined
by the Company’s Board of Directors, in good faith) of any securities or other assets paid in respect of such Extraordinary Dividend
divided by all outstanding shares of the Company at such time (whether or not any shareholders waived their right to receive such dividend);
provided, however, that none of the following shall be deemed an Extraordinary Dividend for purposes of this provision: (a) any
adjustment described in subsection 4.1 above; (b) any cash dividends or cash distributions that, when combined on a per share basis
with all other cash dividends and cash distributions paid on the Common Stock during the 365-day period ending on the date of declaration
of such dividend or distribution, do not exceed $0.50 per share (taking into account all of the outstanding shares of the Company at
such time (whether or not any shareholders waived their right to receive such dividend) and as adjusted to appropriately reflect any
of the events referred to in other subsections of this Section 4 and excluding cash dividends or cash distributions that resulted
in an adjustment to the Warrant Price or to the number of shares of Common Stock issuable on exercise of each Warrant,) but only with
respect to the amount of the aggregate cash dividends or cash distributions equal to or less than $0.50; (c) any payment to satisfy
the conversion rights of the holders of the shares of Common Stock in connection with a proposed initial Business Combination or certain
amendments to the Company’s Amended and Restated Certificate of Incorporation (as described in the Registration Statement); or
(d) any payment in connection with the Company’s liquidation and the distribution of its assets upon its failure to consummate
a Business Combination. Solely for purposes of illustration, if the Company, at a time while the Warrants are outstanding and unexpired,
pays a cash dividend of $0.35 and previously paid an aggregate of $0.40 of cash dividends and cash distributions on the Common Stock
during the 365-day period ending on the date of declaration of such $0.35 dividend, then the Warrant Price will be decreased, effectively
immediately after the effective date of such $0.35 dividend, by $0.25 (the absolute value of the difference between $0.75 (the aggregate
amount of all cash dividends and cash distributions paid or made in such 365-day period, including such $0.35 dividend) and $0.50 (the
greater of (x) $0.50 and (y) the aggregate amount of all cash dividends and cash distributions paid or made in such 365-day
period prior to such $0.35 dividend)). Furthermore, solely for the purposes of illustration, if following the closing of the Company’s
initial Business Combination, there were total shares outstanding of 100,000,000 and the Company paid a $1.00 dividend to 17,500,000
of such shares (with the remaining 82,500,000 shares waiving their right to receive such dividend), then no adjustment to the Warrant
Price would occur as a $17.5 million dividend payment divided by 100,000,000 shares equals $0.175 per share which is less than $0.50
per share.
4.4. Adjustments
in Exercise Price. Whenever the number of shares of Common Stock purchasable upon the exercise of the Warrants is adjusted, as provided
in Sections 4.1 and 4.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price immediately
prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares of Common Stock purchasable upon
the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of which shall be the number of shares
of Common Stock so purchasable immediately thereafter.
4.5. Replacement
of Securities upon Reorganization, etc. In case of any reclassification or reorganization of the outstanding shares of Common
Stock (other than a change covered by Section 4.1, 4.2 or 4.3 hereof or that solely affects the par value of the Common Stock), or
in the case of any merger or consolidation of the Company with or into another corporation (other than a consolidation or merger in which
the Company is the continuing corporation and that does not result in any reclassification or reorganization of the outstanding Common
Stock), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of the Company as an
entirety or substantially as an entirety in connection with which the Company is dissolved, the Warrant holders shall thereafter have
the right to purchase and receive, upon the basis and upon the terms and conditions specified in the Warrants and in lieu of the shares
of Common Stock of the Company immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby,
the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization,
merger or consolidation, or upon a dissolution following any such sale or transfer, that the Warrant holder would have received if such
Warrant holder had exercised his, her or its Warrant(s) immediately prior to such event. If any reclassification also results in
a change in the Common Stock covered by Section 4.1, 4.2 or 4.3, then such adjustment shall be made pursuant to Sections 4.1, 4.2,
4.3, 4.4 and this Section 4.5. The provisions of this Section 4.5 shall similarly apply to successive reclassifications, reorganizations,
mergers or consolidations, sales or other transfers. In no event will the Warrant Price be reduced to less than the par value per share
issuable upon exercise of the Warrant.
4.6. Issuance
in connection with a Business Combination. If, in connection with a Business Combination, the Company (a) issues additional
shares of Common Stock or equity-linked securities at an issue price or effective issue price of less than $9.20 per share (with such
issue price or effective issue price as determined by the Company’s Board of Directors, in good faith, and in the case of any such
issuance to the Sponsor, the initial stockholders or their affiliates, without taking into account any shares of the Company’s
Common Stock issued prior to the Offering and held by the initial stockholders or their affiliates, as applicable, prior to such issuance)
(the “Newly Issued Price”), (b) the aggregate gross proceeds from such issuances represent more than 60% of the
total equity proceeds, and interest thereon, available for the funding of the Business Combination on the date of the consummation of
such Business Combination (net of redemptions), and (c) the Market Value (as defined below) 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) Newly
Issued Price, and the Redemption Trigger Price (as defined below) 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. Solely for purposes of this Section 4.6, the “Market
Value” shall mean the volume weighted average trading price of the Common Stock during the twenty (20) trading day period starting
on the trading day prior to the date of the consummation of the Business Combination.
4.7. Notices
of Changes in Warrant. Upon every adjustment of the Warrant Price or the number of shares issuable upon exercise of a Warrant, the
Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting from such adjustment
and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of a Warrant, setting forth
in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified
in Sections 4.1, 4.2, 4.3, 4.4, 4.5, or 4.6, then, in any such event, the Company shall give written notice to each Warrant holder, at
the last address set forth for such holder in the Warrant Register, of the record date or the effective date of the event. Failure to
give such notice, or any defect therein, shall not affect the legality or validity of such event.
4.8. No
Fractional Warrants or Shares. Notwithstanding any provision contained in this Agreement to the contrary, the Company shall not issue
fractional shares upon exercise of Warrants. If, by reason of any adjustment made pursuant to this Section 4, the holder of any Warrant
would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise,
round up to the nearest whole number of shares of Common Stock to be issued to the Warrant holder.
4.9. Form of
Warrant. The form of Warrant need not be changed because of any adjustment pursuant to this Section 4, and Warrants issued after
such adjustment may state the same Warrant Price and the same number of shares as is stated in the Warrants initially issued pursuant
to this Agreement. However, the Company may at any time in its sole discretion make any change in the form of Warrant that the Company
may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued or countersigned, whether in exchange
or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.
4.10. Other
Events. In case any event shall occur affecting the Company as to which none of the provisions of preceding subsections of this Section 4
are strictly applicable, but which would require an adjustment to the terms of the Warrants in order to (i) avoid an adverse impact
on the Warrants and (ii) effectuate the intent and purpose of this Section 4, then, in each such case, the Company shall appoint
a firm of independent public accountants, investment banking or other appraisal firm of recognized national standing, which shall give
its opinion as to whether or not any adjustment to the rights represented by the Warrants is necessary to effectuate the intent and purpose
of this Section 4 and, if they determine that an adjustment is necessary, the terms of such adjustment. The Company shall adjust
the terms of the Warrants in a manner that is consistent with any adjustment recommended in such opinion.
5. Transfer
and Exchange of Warrants.
5.1. Registration
of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant upon the Warrant Register,
upon surrender of such Warrant for transfer, properly endorsed with signatures, in the case of certificated Warrants, properly guaranteed
and accompanied by appropriate instructions for transfer. Upon any such transfer, a new Warrant representing an equal aggregate number
of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent. In the case of certificated Warrants, the Warrants
so cancelled shall be delivered by the Warrant Agent to the Company from time to time upon request.
5.2. Procedure
for Surrender of Warrants. Warrants may be surrendered to the Warrant Agent, either in certificated form or in book entry position,
together with a written request for exchange or transfer, and thereupon the Warrant Agent shall issue in exchange therefor one or more
new Warrants, or book entry positions, as requested by the registered holder of the Warrants so surrendered, representing an equal aggregate
number of Warrants; provided, however, that in the event that a Warrant surrendered for transfer bears a restrictive legend, the Warrant
Agent shall not cancel such Warrant and issue new Warrants in exchange therefor until the Warrant Agent has received an opinion of counsel
for the Company stating that such transfer may be made and indicating whether the new Warrants must also bear a restrictive legend.
5.3. Fractional
Warrants. The Warrant Agent shall not be required to effect any registration of transfer or exchange which will result in the issuance
of a warrant certificate or book-entry position for a fraction of a warrant, except as part of the Units.
5.4. Service
Charges. No service charge shall be made for any exchange or registration of transfer of Warrants.
5.5. Warrant
Execution and Countersignature. The Warrant Agent is hereby authorized to countersign and to deliver, in accordance with the terms
of this Agreement, the Warrants required to be issued pursuant to the provisions of this Section 5, and the Company, whenever required
by the Warrant Agent, will supply the Warrant Agent with Warrants duly executed on behalf of the Company for such purpose.
5.6. Private
Warrants and Working Capital Warrants. The Warrant Agent shall not register any transfer of the Private Warrants or the Working Capital
Warrants until after the consummation by the Company of an initial Business Combination, except for transfers (i) among the Sponsor
or to the Company’s or the Sponsor’s officers, directors, stockholders, employees, members, and their affiliates; (ii) among
the Sponsor and its officers, directors, stockholders, employees, and members, and their affiliates; (iii) to a holder’s partners,
stockholders, and members upon the holder’s liquidation, in each case if the holder is an entity; (iv) by bona fide gift to
a member of the holder’s immediate family or to a trust, the beneficiary of which is the holder or a member of the holder’s
immediate family, in each case for estate planning purposes; (v) by virtue of the laws of descent and distribution upon death; (vi) pursuant
to a qualified domestic relations order; (vii) by certain pledges to secure obligations incurred in connection with purchases of
the Company’s securities; (viii) by private sales made at or prior to the consummation of an initial Business Combination
at prices no greater than the price at which the shares were originally purchased; (ix) to the Company for no value for cancellation
in connection with the consummation of a Business Combination; (x) in connection with the consummation of a Business Combination
at prices no greater than the price at which the Warrants were originally purchased; (xi) in the event of the Company’s liquidation
prior to its consummation of an initial Business Combination; or (xii) in the event that, subsequent to the consummation of an initial
Business Combination, the Company completes a liquidation, merger, capital stock exchange or other similar transaction which results
in all of the Company’s stockholders having the right to exchange their Common Stock for cash, securities or other property, in
each case (except for clauses (ix), (xi) or (xii) or with the Company’s prior written consent) on the condition that
prior to such registration for transfer, the Warrant Agent shall be presented with written documentation pursuant to which each transferee
(each, a “Permitted Transferee”) or the trustee or legal guardian for such Permitted Transferee agrees to be bound
by the transfer restrictions contained in this Agreement and any other applicable agreement the transferor is bound by.
5.7. Transfers
prior to Detachment. Prior to the Detachment Date, the Public Warrants may be transferred or exchanged only together with the Unit
in which such Warrant is included, and only for the purpose of effecting, or in conjunction with, a transfer or exchange of such Unit.
Furthermore, each transfer of a Unit on the register relating to such Units shall operate also to transfer the Warrants included in such
Unit. Notwithstanding the foregoing, the provisions of this Section 5.7 shall have no effect on any transfer of Warrants on or after
the Detachment Date.
6. Redemption.
6.1. Redemption.
Not less than all of the outstanding Warrants may be redeemed, at the option of the Company, at any time during the Exercise Period,
at the office of the Warrant Agent, upon the notice referred to in Section 6.2, at the price of $0.01 per Warrant (“Redemption
Price”), provided that the last sales price of the Common Stock equals or exceeds $18.00 per share (subject to adjustment in
accordance with Section 4 hereof) (the “Redemption Trigger Price”), on each of twenty (20) trading days within
any thirty (30) trading day period commencing after the Warrants become exercisable and ending on the third trading day prior to the
date on which notice of redemption is given and provided that there is an effective registration statement covering the shares of Common
Stock issuable upon exercise of the Warrants, and a current prospectus relating thereto, available throughout the 30-day redemption or
the Company has elected to require the exercise of the Warrants on a “cashless basis” pursuant to subsection 3.3.1(b); provided,
however, that if and when the Public Warrants become redeemable by the Company, the Company may not exercise such redemption right if
the issuance of shares of Common Stock upon exercise of the Public Warrants is not exempt from registration or qualification under applicable
state blue sky laws or the Company is unable to effect such registration or qualification.
6.2. Date
Fixed for, and Notice of, Redemption. In the event the Company shall elect to redeem all of the Warrants that are subject to redemption,
the Company shall fix a date for the redemption (the “Redemption Date”). Notice of redemption shall be mailed by first
class mail, postage prepaid, by the Company not less than thirty (30) days prior to the Redemption Date to the registered holders of the
Warrants to be redeemed at their last addresses as they shall appear on the Warrant Register. Any notice mailed in the manner herein provided
shall be conclusively presumed to have been duly given whether or not the registered holder received such notice.
6.3. Exercise
After Notice of Redemption. The Public Warrants may be exercised, for cash (or on a “cashless basis” in accordance with
Section 3 of this Agreement) at any time after notice of redemption shall have been given by the Company pursuant to Section 6.2
hereof and prior to the Redemption Date. In the event the Company determines to require all holders of Public Warrants to exercise their
Warrants on a “cashless basis” pursuant to Section 3.3.1(b), the notice of redemption will contain the information necessary
to calculate the number of shares of Common Stock to be received upon exercise of the Warrants, including the “Fair Market Value”
in such case. On and after the Redemption Date, the record holder of the Warrants shall have no further rights except to receive, upon
surrender of the Warrants, the Redemption Price.
7. Other
Provisions Relating to Rights of Holders of Warrants.
7.1. No
Rights as Stockholder. A Warrant does not entitle the registered holder thereof to any of the rights of a stockholder of the Company,
including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive rights to vote or to consent
or to receive notice as stockholders in respect of the meetings of stockholders or the election of directors of the Company or any other
matter.
7.2. Lost,
Stolen, Mutilated, or Destroyed Warrants. If any Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant Agent
may on such terms as to indemnity or otherwise as they may in their discretion impose (which shall, in the case of a mutilated Warrant,
include the surrender thereof), issue a new Warrant of like denomination, tenor, and date as the Warrant so lost, stolen, mutilated, or
destroyed. Any such new Warrant shall constitute a substitute contractual obligation of the Company, whether or not the allegedly lost,
stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.
7.3. Reservation
of Shares of Common Stock. The Company shall at all times reserve and keep available a number of its authorized but unissued shares
of Common Stock that will be sufficient to permit the exercise in full of all outstanding Warrants issued pursuant to this Agreement.
7.4. Registration
of Shares of Common Stock. The Company agrees that as soon as practicable, but in no event later than twenty (20) Business Days after
the closing of its initial Business Combination, it shall use its best efforts to file with the SEC a registration statement for the
registration, under the Act, of the shares of Common Stock issuable upon exercise of the Warrants, and it shall use its best efforts
to take such action as is necessary to register or qualify for sale, in those states in which the Warrants were initially offered by
the Company and in those states where holders of Warrants then reside, the shares of Common Stock issuable upon exercise of the Warrants,
to the extent an exemption is not available. The Company will use its best efforts to cause the same to become effective and to maintain
the effectiveness of such registration statement until the expiration of the Warrants in accordance with the provisions of this Agreement.
If any such registration statement has not been declared effective by the 60th Business Day following the closing of the Business Combination,
holders of the Warrants shall have the right, during the period beginning on the 61st Business Day after the closing of the Business
Combination and ending upon such registration statement being declared effective by the SEC, and during any other period when the Company
shall fail to have maintained an effective registration statement covering the shares of Common Stock issuable upon exercise of the Warrants,
to exercise such Warrants on a “cashless basis” as determined in accordance with Section 3.3.1(d). The Company shall
provide the Warrant Agent with an opinion of counsel for the Company (which shall be an outside law firm with securities law experience)
stating that (i) the exercise of the Warrants on a cashless basis in accordance with this Section 7.4 is not required to be
registered under the Act and (ii) the shares of Common Stock issued upon such exercise will be freely tradable under U.S. federal
securities laws by anyone who is not an affiliate (as such term is defined in Rule 144 under the Act) of the Company and, accordingly,
will not be required to bear a restrictive legend. For the avoidance of any doubt, unless and until all of the Warrants have been exercised
on a cashless basis, the Company shall continue to be obligated to comply with its registration obligations under the first three sentences
of this Section 7.4. The provisions of this Section 7.4 may not be modified, amended, or deleted without the prior written
consent of the Sponsor.
8. Concerning
the Warrant Agent and Other Matters.
8.1. Payment
of Taxes. The Company will from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant
Agent in respect of the issuance or delivery of shares of Common Stock upon the exercise of Warrants, but the Company shall not be obligated
to pay any transfer taxes in respect of the Warrants or such shares.
8.2. Resignation,
Consolidation, or Merger of Warrant Agent.
8.2.1. Appointment
of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged
from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the office
of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing a successor
Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of thirty (30) days after
it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of the Warrant (who shall, with
such notice, submit his Warrant for inspection by the Company), then the holder of any Warrant may apply to the Supreme Court of the
State of New York for the County of New York for the appointment of a successor Warrant Agent at the Company’s cost. Any successor
Warrant Agent, whether appointed by the Company or by such court, shall be a corporation organized and existing under the laws of the
State of New York, in good standing and having its principal office in the Borough of Manhattan, City and State of New York, and authorized
under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authority. After appointment,
any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties, and obligations of its predecessor
Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed; but if for any reason
it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument
transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon
request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for
more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities,
duties, and obligations.
8.2.2. Notice
of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the
predecessor Warrant Agent and the Transfer Agent for the shares of Common Stock not later than the effective date of any such appointment.
8.2.3. Merger
or Consolidation of Warrant Agent. Any corporation into which the Warrant Agent may be merged or with which it may be consolidated
or any corporation resulting from any merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant
Agent under this Agreement without any further act.
8.3. Fees
and Expenses of Warrant Agent.
8.3.1. Remuneration.
The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent hereunder and will reimburse
the Warrant Agent upon demand for all expenditures that the Warrant Agent may reasonably incur in the execution of its duties hereunder.
8.3.2. Further
Assurances. The Company agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed, acknowledged, and
delivered all such further and other acts, instruments, and assurances as may reasonably be required by the Warrant Agent for the carrying
out or performing of the provisions of this Agreement.
8.4. Liability
of Warrant Agent.
8.4.1. Reliance
on Company Statement. Whenever in the performance of its duties under this Agreement, the Warrant Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder, such fact
or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established
by a statement signed by the Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, President, Secretary or Chairperson
of the Board of Directors of the Company and delivered to the Warrant Agent. The Warrant Agent may rely upon such statement for any action
taken or suffered in good faith by it pursuant to the provisions of this Agreement.
8.4.2. Indemnity.
The Warrant Agent shall be liable hereunder only for its own fraud, gross negligence, willful misconduct or bad faith (as determined
by a court of competent jurisdiction in a final and non-appealable decision). The Company agrees to indemnify the Warrant Agent and save
it harmless against any and all liabilities, including judgments, costs and reasonable counsel fees, for anything done or omitted by
the Warrant Agent in the execution of this Agreement except as a result of the Warrant Agent’s fraud, gross negligence, willful
misconduct, or bad faith (as determined by a court of competent jurisdiction in a final and non-appealable decision).
8.4.3. Exclusions.
The Warrant Agent shall have no responsibility with respect to the validity of this Agreement or with respect to the validity or execution
of any Warrant (except its countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or condition
contained in this Agreement or in any Warrant; nor shall it be responsible to make any adjustments required under the provisions of Section 4
hereof or responsible for the manner, method, or amount of any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization
or reservation of any shares of Common Stock to be issued pursuant to this Agreement or any Warrant or as to whether any shares of Common
Stock will, when issued, be valid and fully paid and nonassessable.
8.5. Acceptance
of Agency. The Warrant Agent hereby accepts the agency established by this Agreement and agrees to perform the same upon the terms
and conditions herein set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently
account for, and pay to the Company, all monies received by the Warrant Agent for the purchase of shares of Common Stock through the exercise
of Warrants.
9. Miscellaneous
Provisions.
9.1. Successors.
All the covenants and provisions of this Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the
benefit of their respective successors and assigns.
9.2. Notices.
Any notice, statement or demand authorized by this Agreement to be given or made by the Warrant Agent or by the holder of any Warrant
to or on the Company shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private
courier service within five (5) days after deposit of such notice, postage prepaid, addressed (until another address is filed in
writing by the Company with the Warrant Agent), as follows:
Western
Acquisition Ventures Corp.
42 Broadway, 12th
Floor
New York, New York 10004
Attention: Stephen Christoffersen
with a copy in each case (which shall
not constitute service) to:
Reed Smith LLP
101
Second Street, Suite 1800
San Francisco, CA 94105
Attention: Marc D. Hauser, Esq.
Any notice, statement
or demand authorized by this Agreement to be given or made by the holder of any Warrant or by the Company to or on the Warrant Agent shall
be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service within
five days after deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Warrant Agent with
the Company), as follows:
If to the Warrant Agent:
American Stock Transfer & Trust Company
________________
Attention: Compliance Department
with a copy in each case (which shall
not constitute service) to:
[Warrant
Agent Counsel]
and with a copy in each case (which shall
not constitute service) to:
Reed Smith LLP
101 Second Street, Suite 1800
San Francisco, CA 94105
Attention:
Marc D. Hauser, Esq.
9.3. Applicable
Law and Exclusive Forum. The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed in
all respects by the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application
of the substantive laws of another jurisdiction. Subject to applicable law, the Company hereby agrees that any action, proceeding or
claim against it arising out of or relating in any way to this Agreement, including under the Act, shall 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 irrevocably submits to
such jurisdiction, which jurisdiction shall be exclusive forum for any such action, proceeding or claim. The Company hereby waives any
objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Notwithstanding the foregoing, the provisions
of this paragraph 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 the Warrants shall be deemed to have notice of and to have consented to the forum provisions
in this Section 9.3. If any action, the subject matter of which is within the scope the forum provisions above, is filed in a court
other than a court located within 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 warrant holder, such warrant holder shall be deemed to have consented to: (x) the personal jurisdiction
of the state and federal courts located within the State of New York or the United States District Court for the Southern District 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.
9.4. Persons
Having Rights under this Agreement. Nothing in this Agreement expressed and nothing that may be implied from any of the provisions
hereof is intended, or shall be construed, to confer upon, or give to, any person or corporation other than the parties hereto and the
registered holders of the Warrants any right, remedy, or claim under or by reason of this Agreement or of any covenant, condition, stipulation,
promise, or agreement hereof. All covenants, conditions, stipulations, promises, and agreements contained in this Agreement shall be for
the sole and exclusive benefit of the parties hereto (and the Sponsor with respect to Sections 7.4, 9.4, and 9.8 hereof) and their successors
and assigns and of the registered holders of the Warrants.
9.5. Examination
of the Warrant Agreement. A copy of this Agreement shall be available at all reasonable times at the office of the Warrant Agent in
the Borough of Manhattan, City and State of New York, for inspection by the registered holder of any Warrant. The Warrant Agent may require
any such holder to submit his Warrant for inspection by it.
9.6. Counterparts.
This Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes
be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.
9.7. Effect
of Headings. The section headings herein are for convenience only and are not part of this Agreement and shall not affect the interpretation
thereof.
9.8. Amendments.
This Agreement may be amended by the parties hereto without the consent of any registered holder for the purpose of (i) curing any
ambiguity or to correct any mistake, including to conform the provisions hereof to the description of the terms of the Warrants and this
Agreement set forth in the Prospectus, or curing, correcting or supplementing any defective provision contained herein, or (ii) adding
or changing any other provisions with respect to matters or questions arising under this Agreement as the parties may deem necessary
or desirable and that the parties deem shall not adversely affect the interest of the registered holders. All other modifications or
amendments, including any amendment to increase the Warrant Price or shorten the Exercise Period, shall require the written consent or
vote of the registered holders of at least 50% of the then outstanding Public Warrants. Notwithstanding the foregoing, the Company may
lower the Warrant Price or extend the duration of the Exercise Period pursuant to Sections 3.1 and 3.2, respectively, without the consent
of the registered holders. The provisions of this Section 9.8 may not be modified, amended or deleted without the prior written
consent of the Sponsor.
9.9. Trust
Account Waiver. The Warrant Agent acknowledges and agrees that it shall not make any claims or proceed against the trust account established
by the Company in connection with the Offering (as more fully described in the Registration Statement) (“Trust Account”),
including by way of set-off, and shall not be entitled to any funds in the Trust Account under any circumstance. In the event that the
Warrant Agent has a claim against the Company under this Agreement, the Warrant Agent will pursue such claim solely against the Company
and not against the property held in the Trust Account.
9.10. Severability.
This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the
validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable
term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to
such invalid or unenforceable provision as may be possible and be valid and enforceable.
Exhibit A – Form of Warrant Certificate
Exhibit B – Legend
[Signature Page Follows]
IN
WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the day and year first above written.
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WESTERN ACQUISITION VENTURES CORP.
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By:
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Stephen Christoffersen, Chief Executive Officer
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AMERICAN STOCK TRANSFER & TRUST COMPANY,
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as Warrant Agent
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By:
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Name:
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Title:
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EXHIBIT A
Form of
Warrant Certificate
[See attached]
EXHIBIT B
LEGEND
